Exhibit 10.24


 


Level 2 – Amended & Restated


 


PONIARD PHARMACEUTICALS, INC.

AMENDED AND RESTATED

KEY EXECUTIVE SEVERANCE AGREEMENT


 


This Amended
and Restated Key Executive Severance Agreement (this “Agreement”), dated as
of February 24, 2009, is entered into by and between PONIARD
PHARMACEUTICALS, INC., a Washington corporation (as supplemented by Section 10
hereof, the “Company”),
and CHENI KWOK (the “Executive”)
to reflect amendments made in December, 2008.


 


The Board of
Directors of the Company (the “Board”) has determined that it is in the best interests
of the Company and its shareholders to ensure that the Company will have the
continued dedication of the Executive, notwithstanding the fact that the
Executive does not have any form of traditional employment contract or other
assurance of job security.  The Board
believes it is imperative to diminish any distraction of the Executive arising
from the personal uncertainty and insecurity that arises in the absence of any
assurance of job security by providing the Executive with reasonable
compensation and benefit arrangements in the event of termination of the
Executive’s employment by the Company under certain defined circumstances.


 


In order to
accomplish these objectives, the Board has caused the Company to enter into
this Agreement.


 


1.             Term


 


The initial
term of this Agreement (the “Initial Term”) shall be for a period of one (1) year
from the date of this  Agreement
as first appearing above; provided, however, that this Agreement shall
automatically renew for successive additional one (1) year periods (“Renewal Terms”)
unless notice of nonrenewal is given by either party to the other party at
least nine (9) months prior to the end of the Initial Term or any Renewal
Term; and provided, further, that if a Change of Control (as defined in the
Change of Control Agreement referenced in Section 16 hereof) occurs during
the Term, the Term shall automatically extend for the duration of the
Employment Period (as defined in the Change of Control Agreement).  The “Term” of this Agreement shall be the Initial
Term plus all Renewal Terms and, if applicable, the duration of the Employment
Period.  At the end of the Term, this
Agreement shall terminate without further action by either the Company or the
Executive.


 


2.             Employment
at Will


 


The Executive
and the Company acknowledge that, except as may otherwise be provided under any
other written agreement between the Executive and the Company, the employment
of the Executive by the Company or any affiliated companies is “at will” and
may be terminated by either the Executive or the Company or its affiliated
companies at any time with or without cause, subject to the termination
payments prescribed herein.


 

















 


3.             Attention
and Effort


 


During any
period of time that the Executive remains in the employ of the Company, and
excluding any periods of vacation and sick leave to which the Executive is
entitled, the Executive will devote all of the Executive’s productive time,
ability, attention and effort to the business and affairs of the Company and
the discharge of the responsibilities assigned to the Executive hereunder, and
will seek to perform faithfully and efficiently such responsibilities.  It shall not be a violation of this Agreement
for the Executive to (a) serve on corporate, civic or charitable boards or
committees, (b) deliver lectures, fulfill speaking engagements or teach at
educational institutions, (c) manage personal investments, or (d) engage
in activities permitted by the policies of the Company or as specifically permitted
by the Company, so long as such activities do not significantly interfere with
the performance of the Executive’s responsibilities in accordance with this
Agreement.  It is expressly understood
and agreed that to the extent any such activities have been conducted by the
Executive prior to the Term, the continued conduct of such activities (or the
conduct of activities similar in nature and scope thereto) during the Term
shall not thereafter be deemed to interfere with the performance of the Executive’s
responsibilities to the Company.


 


4.             Termination


 


During the
Term, employment of the Executive may be terminated as follows, but, in any
case, the nondisclosure provisions set forth in Section 7 hereof shall
survive the termination of this Agreement and the termination of the Executive’s
employment with the Company:


 


4.1          Termination
by the Company or the Executive


 


At any time
during the Term, the Company may terminate the employment of the Executive with
or without Cause (as defined below), and the Executive may terminate the
Executive’s employment for Good Reason (as defined below) or for any reason,
upon giving a Notice of Termination (as defined below).


 


4.2          Automatic
Termination


 


This Agreement
and the Executive’s employment during the Term shall terminate automatically
upon the death or Total Disability of the Executive.  The term “Total Disability” as used herein shall
mean the Executive’s inability (with such accommodation as may be required by
law and which places no undue burden on the Company), as determined by a
physician selected by the Company and acceptable to the Executive, to perform
the Executive’s essential duties for a period or periods aggregating twelve
(12) weeks in any three hundred sixty-five (365) day period as a result of
physical or mental illness, loss of legal capacity or any other cause beyond
the Executive’s control, unless the Executive is granted a leave of absence by
the Board.


 


4.3          Notice
of Termination


 


Any
termination by the Company or by the Executive during the Term shall be
communicated by a Notice of Termination to the other party given in accordance
with Section 9 hereof.  The term “Notice of Termination”
shall mean a written notice that (a) indicates the specific termination
provision in this Agreement relied upon and (b) to the extent applicable,
sets


 


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forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive’s employment under the provision so
indicated.  The failure by the Executive
or the Company to set forth in the Notice of Termination any fact or
circumstance that contributes to a showing of Good Reason or Cause shall not
waive any right of the Executive or the Company hereunder or preclude the Executive
or the Company from asserting such fact or circumstance in enforcing the
Executive’s or the Company’s rights hereunder.


 


4.4          Date
of Termination


 


“Date of Termination”
means (a) if the Executive’s employment is terminated by reason of death,
the last day of the calendar month in which the Executive’s death occurs, (b) if
the Executive’s employment is terminated by reason of Total
Disability, immediately upon a determination by the Company of the
Executive’s Total Disability, and (c) in all other cases, ten (10) days
after the date of personal delivery or mailing of the Notice of
Termination.  The Executive’s employment
and performance of services will continue during such ten (10) day period;
provided, however, that the Company may, upon notice to the Executive and
without reducing the Executive’s compensation during such period, excuse the
Executive from any or all of the Executive’s duties during such period.  Notwithstanding
anything contained in this Agreement to the contrary, the date on which a “separation
from service” (“Separation
from Service”) pursuant to Section 409A
of the Internal Revenue Code of 1986, as amended (“Code Section 409A”),
occurs shall be the “Date of Termination” or termination of employment for
purposes of determining the timing of payments under this Agreement to the
extent necessary to have such payments and benefits under this Agreement be
exempt from the requirements of Code Section 409A or comply with the
requirements of Code Section 409A.


 


5.             Termination
Payments


 


In the event
of termination of the Executive’s employment during the Term, all compensation
and benefits shall terminate, except as specifically provided in this Section 5.


 


5.1          Termination
by the Company Other Than for Cause or by the Executive for Good Reason


 


If during the
Term the Company terminates the Executive’s employment other than for Cause or
the Executive terminates the Executive’s employment for Good Reason, the
Executive shall be entitled to:


 


(a)           receive payment of the
following accrued obligations (the “Accrued Obligations”):


 


(i)            the
Executive’s then current annual base salary through the Date of Termination to
the extent not theretofore paid;


 


(ii)           any
compensation previously deferred by the Executive (together with accrued
interest or earnings thereon, if any); and


 


(iii)          any
accrued vacation pay that would be payable under the Company’s standard policy,
in each case to the extent not theretofore paid;


 


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(b)           have the Company pay
for nine (9) months after the Date of Termination or until the Executive
qualifies for comparable medical and dental insurance benefits from another
employer, whichever occurs first, the Executive’s premiums for health insurance
benefit continuation for the Executive and the Executive’s family members, if
applicable, that the Company provides to the Executive under the provisions of
the federal Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“COBRA”),
to the extent that the Company would have paid such premiums had the Executive
remained employed by the Company (such continued payment is hereinafter
referred to as “COBRA
Continuation”); and


 


(c)           an amount as severance
pay equal to seventy-five percent (75%) of the Executive’s then current annual
base salary for the fiscal year in which the Date of Termination occurs,
subject to payment as set forth in Sections 5.5 and 5.9 hereof.


 


5.2          Termination
for Cause or Other Than for Good Reason


 


If during the
Term the Executive’s employment shall be terminated by the Company for Cause or
by the Executive for other than Good Reason, this Agreement shall terminate
without further obligation on the part of the Company to the Executive, other
than the Company’s obligation to pay the Executive the Accrued Obligations to
the extent theretofore unpaid.


 


5.3          Expiration
of Term


 


In the event
the Executive’s employment is not terminated prior to expiration of the Term,
this Agreement shall terminate without further obligation on the part of the
Company to the Executive.


 


5.4          Termination
Because of Death or Total Disability


 


If during the
Term the Executive’s employment is terminated by reason of the Executive’s
death or Total Disability, this Agreement shall terminate automatically without
further obligation on the part of the Company to the Executive or the Executive’s
legal representatives under this Agreement, other than the Company’s obligation
to pay the Executive the Accrued Obligations (which shall be paid to the
Executive’s estate or beneficiary, as applicable in the case of the Executive’s
death) and to provide COBRA Continuation.


 


5.5          Payment
Schedule


 


All payments
of Accrued Obligations, or any portion thereof payable pursuant to this Section 5,
other than deferred compensation pursuant to Section 5.1(a)(ii) hereof,
shall be made to the Executive within ten (10) working days of the Date of
Termination.  Deferred compensation
pursuant to Section 5.1(a)(ii) hereof shall be payable pursuant to
the terms of the deferred compensation program. 
Any severance payments payable to the Executive pursuant to Section 5.1(c) hereof
shall be made to the Executive in the form of salary continuation, payable at
normal payroll intervals during the nine (9) month period following the
Date of Termination.  Notwithstanding the
preceding provisions of this Section 5, if any payment or benefit pursuant
to this Agreement constitutes a “deferral of compensation” subject to Code Section 409A
(after taking into account, to the maximum extent possible, any applicable
exemptions) (a “409A Payment”) treated as
payable to a Specified Employee (as defined in Section 20.1 hereof) upon


 


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Separation
from Service, the provisions of Section 20.1 hereof shall apply.  Section 5.8 hereof must be satisfied to
receive payments and benefits under this Agreement.


 


5.6          Cause


 


For purposes
of this Agreement, “Cause”
means cause given by the Executive to the Company and shall include, without
limitation, the occurrence of one (1) or more of the following events:


 


(a)           a clear refusal to
carry out any material lawful duties of the Executive or any directions of the
Board or senior management of the Company reasonably consistent with those
duties;


 


(b)           persistent failure to
carry out any lawful duties of the Executive or any directions of the Board or
senior management reasonably consistent with those duties; provided, however,
that the Executive has been given reasonable notice and opportunity to correct
any such failure;


 


(c)           violation by the
Executive of a state or federal criminal law involving the commission of a
crime against the Company or any other criminal act involving moral turpitude;


 


(d)           current abuse by the
Executive of alcohol or controlled substances; deception, fraud,
misrepresentation or dishonesty by the Executive; or any incident materially
compromising the Executive’s reputation or ability to represent the Company
with investors, customers or the public; or


 


(e)           any other material
violation of any provision of this Agreement by the Executive, subject to the
notice and opportunity-to-cure requirements of Section 8 hereof.


 


5.7          Good
Reason


 


For purposes
of this Agreement, “Good
Reason” means:


 


(a)           material reduction of
the Executive’s annual base salary to a level below the level in effect on the
date of this Agreement, regardless of any change in the Executive’s duties or
responsibilities;


 


(b)           the assignment to the
Executive of any duties materially inconsistent with the Executive’s position,
authority, duties or responsibilities or any other action by the Company that
results in a material diminution in such position, authority, duties or
responsibilities, excluding for this purpose an isolated and inadvertent action
not taken in bad faith and that is remedied by the Company promptly after
receipt of notice thereof given by the Executive;


 


(c)           the Company’s requiring
the Executive to be based at any office or location more than fifty (50) miles
from the city in which the Executive is currently employed by the Company,
i.e., San Francisco, California or Seattle, Washington;


 


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(d)           any failure by the
Company to comply with and satisfy Section 10 hereof; provided, however,
that the Company’s successor has received at least ten (10) days’ prior
written notice from the Company or the Executive of the requirements of Section 10
hereof; or


 


(e)           any other material
violation of any provision of this Agreement by the Company;


 


provided,
however, that the Executive has notified the Company of such salary reduction,
assignment, failure, situation or violation within ninety (90) days of its
occurrence and there has been compliance with the notice and
opportunity-to-cure requirements of Section 8 hereof.


 


5.8          General
Release of Claims


 


As a condition
to receiving the payments and benefits under this Section 5 other than
Accrued Obligations set forth in Sections 5.1(a)(i) and 5.1(a)(iii) hereof,
the Executive shall execute (and not later revoke) a general release and waiver
of all claims against the Company, which release and waiver shall be in a form
satisfactory to the Company, in its sole discretion, and delivered to the
Company no later than the seventh day of the third month of the fiscal year
following the year in which the Date of Termination occurs.  By way of example and not limitation, the
general release and waiver of claims will include any claims for wages,
bonuses, employment benefits, or damages of any kind whatsoever, arising out of
any contracts, express or implied, any covenant of good faith and fair dealing,
express or implied, any theory of wrongful discharge, any legal restriction on
the Company’s right to terminate employment, or any federal, state or other
governmental statute or ordinance, including, without limitation, Title VII of
the Civil Rights Act of 1964, the federal Age Discrimination in Employment Act,
the Americans with Disabilities Act, the Family and Medical Leave Act, the
Washington Law Against Discrimination, or any other legal limitation on the
employment relationship.  To the extent
any payment or benefit is a 409A Payment, the provisions of Section 20.3
hereof shall apply.


 


5.9          Dispute
Regarding Existence of Good Reason for Termination


 


In the event
the Company disputes whether Good Reason existed for the Executive to terminate
the Executive’s employment for Good Reason, the Company shall pay salary
continuation as provided in Section 5.5 until the earliest of (a) settlement
by the parties, (b) determination by arbitration in accordance with Section 14
hereof that Good Reason did not exist, and (c) completion of the payments
required by Section 5.5 and Section 5.1(c) hereof.  If, pursuant to Section 14 hereof, an
arbitrator determines that Good Reason did not exist, the arbitrator shall also
decide whether the Executive had a reasonable, good-faith basis for claiming
that there was Good Reason to terminate. 
If the arbitrator determines that there was not such a basis, the
Executive shall be obligated to repay promptly to the Company the salary
continuation payments; if the arbitrator determines that there was such a
basis, the Executive shall not be obligated to repay the salary continuation.


 


6.             Representations,
Warranties and Other Conditions


 


In order to
induce the Company to enter into this Agreement, the Executive represents and
warrants to the Company as follows:


 


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6.1          Health


 


The Executive
is in good health and knows of no physical or mental disability that, with any
accommodation that may be required by law and that places no undue burden on
the Company, would prevent the Executive from fulfilling the Executive’s obligations
hereunder.  The Executive agrees, if the
Company requests, to submit to reasonable periodic medical examinations by a
physician or physicians designated by, paid for and arranged by the Company.  The Executive agrees that each examination’s
medical report shall be provided to the Company.


 


6.2          No
Violation of Other Agreements


 


The Executive
represents that neither the execution nor the performance of this Agreement by
the Executive will violate or conflict in any way with any other agreements or
obligations by which the Executive may be bound.


 


7.                                      Nondisclosure;
Return of Materials


 


7.1          Nondisclosure


 


Except as
required by the Executive’s employment with the Company, the Executive will
not, at any time during the term of employment by the Company, or at any time
thereafter, directly, indirectly or otherwise, use, communicate, disclose,
disseminate, lecture upon or publish articles relating to any confidential,
proprietary or trade secret information of the Company without the prior
written consent of the Company.  The
Executive understands that the Company will be relying on this Agreement in
continuing the Executive’s employment, paying the Executive’s compensation,
granting the Executive any promotions or raises, or entrusting the Executive
with any information that helps the Company compete with others.


 


7.2          Return
of Materials


 


All documents,
records, notebooks, notes, memoranda, drawings or other documents made or
compiled by the Executive at any time while employed by the Company, or in the
Executive’s possession, including any and all copies thereof, shall be the
property of the Company and shall be held by the Executive in trust and solely
for the benefit of the Company, and shall be delivered to the Company by the
Executive upon termination of employment or at any other time upon request by
the Company.


 


8.                                      Notice
and Cure of Breach


 


Whenever a
breach of this Agreement by either party is relied upon as justification for
any action taken by the other party pursuant to any provision of this Agreement,
other than clause (a), (b), (c) or (d) of Section 5.6
hereof, before such action is taken, the party asserting the breach of this
Agreement shall give the other party at least twenty (20) days’ prior written
notice of the existence and the nature of such breach before taking further
action hereunder and shall give the party purportedly in breach of this
Agreement the opportunity to correct such breach during the twenty (20) day
period.


 


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9.                                      Form of
Notice


 


Every notice
required by the terms of this Agreement shall be given in writing by serving
the same upon the party to whom it was addressed personally or by registered or
certified mail, return receipt requested, at the address set forth below or at
such other address as may hereafter be designated by notice given in compliance
with the terms hereof:


 


	
  If to the Executive:

  	
  Cheni Kwok

  
	
   

  	
  10 Scenic Way #108

  
	
   

  	
  San Mateo, California 94403

  
	
   

  	
   

  
	
  If to the
  Company:

  	
  Poniard
  Pharmaceuticals, Inc.

  
	
   

  	
  300 Elliott
  Avenue West, Suite 500

  
	
   

  	
  Seattle,
  Washington 98119

  
	
   

  	
  Attn: Chief
  Executive Officer

  
	
   

  	
   

  
	
  With a copy
  to:

  	
  Perkins Coie
  LLP

  
	
   

  	
  1201 Third
  Avenue, Suite 4800

  
	
   

  	
  Seattle,
  Washington 98101-3099

  
	
   

  	
  Attn: James
  R. Lisbakken

  



 


Except as set forth in Section 4.4
hereof, if notice is mailed, such notice shall be effective upon mailing.


 


10.                               Assignment


 


This Agreement
is personal to the Executive and shall not be assignable by the Executive.


 


The Company
shall assign to and require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all the
business and/or assets of the Company to assume expressly and agree to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform it if no such succession had taken place.  As used in this Agreement, “Company” shall mean
Poniard Pharmaceuticals, Inc. and any affiliated company or successor to
its business and/or assets as aforesaid that assumes and agrees to perform this
Agreement by contract, operation of law or otherwise; and as long as such
successor assumes and agrees to perform this Agreement, the termination of the
Executive’s employment by one such entity and the immediate hiring and
continuation of the Executive’s employment by the succeeding entity shall not
be deemed to constitute a termination or trigger any severance obligation under
this Agreement.  All the terms and
provisions of this Agreement shall be binding upon and inure to the benefit of
and be enforceable by the parties hereto and their respective successors and
permitted assigns.


 


11.                               Waivers


 


No delay or
failure by any party hereto in exercising, protecting or enforcing any of its
rights, titles, interests or remedies hereunder, and no course of dealing or
performance with respect thereto, shall constitute a waiver thereof.  The express waiver by a party hereto of any


 


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right, title,
interest or remedy in a particular instance or circumstance shall not constitute
a waiver thereof in any other instance or circumstance.  All rights and remedies shall be cumulative
and not exclusive of any other rights or remedies.


 


12.                               Amendments
in Writing


 


No amendment,
modification, waiver, termination or discharge of any provision of this
Agreement, or consent to any departure therefrom by either party hereto, shall
in any event be effective unless the same shall be in writing, specifically
identifying this Agreement and the provision intended to be amended, modified,
waived, terminated or discharged and signed by the Company and the Executive,
and each such amendment, modification, waiver, termination or discharge shall
be effective only in the specific instance and for the specific purpose for
which given.  No provision of this
Agreement shall be varied, contradicted or explained by any oral agreement,
course of dealing or performance or any other matter not set forth in an
agreement in writing and signed by the Company and the Executive.


 


13.                               Applicable
Law


 


This Agreement
shall in all respects, including all matters of construction, validity and
performance, be governed by, and construed and enforced in accordance with, the
laws of the State of Washington, without regard to any rules governing
conflicts of laws.


 


14.                               Arbitration;
Attorneys’ Fees


 


Except in
connection with enforcing Section 7 hereof, for which legal and equitable
remedies may be sought in a court of law, any dispute arising under this
Agreement shall be subject to arbitration. 
The arbitration proceeding shall be conducted in accordance with the
Commercial Arbitration Rules of the American Arbitration Association (the “AAA Rules”) then in
effect, conducted by one (1) arbitrator either mutually agreed upon or
selected in accordance with the AAA Rules. 
The arbitration shall be conducted in King County, Washington, under the
jurisdiction of the Seattle office of the American Arbitration
Association.  The arbitrator shall have
authority only to interpret and apply the provisions of this Agreement, and
shall have no authority to add to, subtract from or otherwise modify the terms
of this Agreement.  Any demand for
arbitration must be made within sixty (60) days of the event(s) giving
rise to the claim that this Agreement has been breached.  The arbitrator’s decision shall be final and
binding, and each party agrees to be bound by the arbitrator’s award, subject
only to an appeal therefrom in accordance with the laws of the State of
Washington.  Either party may obtain
judgment upon the arbitrator’s award in the Superior Court of King County,
Washington.


 


If it becomes
necessary to pursue or defend any legal proceeding, whether in arbitration or
court, in order to resolve a dispute arising under this Agreement, the
prevailing party in any such proceeding shall be entitled to recover its
reasonable costs and attorneys’ fees.  To
the extent necessary to prevent the Executive from being subject to any
additional tax pursuant to Code Section 409A(a)(1)(B), any amounts payable
to the Executive pursuant to this paragraph shall be paid in no event later
than the year following the year during which such costs and fees were
incurred.


 


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15.                               Severability


 


If any
provision of this Agreement shall be held invalid, illegal or unenforceable in
any jurisdiction, for any reason, including, without limitation, the duration
of such provision, its geographical scope or the extent of the activities
prohibited or required by it, then, to the full extent permitted by law, (a) all
other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in order to carry out the intent
of the parties hereto as nearly as may be possible, (b) such invalidity,
illegality or unenforceability shall not affect the validity, legality or
enforceability of any other provision hereof, and (c) any court or
arbitrator having jurisdiction thereover shall have the power to reform such
provision to the extent necessary for such provision to be enforceable under
applicable law.


 


16.                               Coordination
With Change of Control Agreement


 


Contemporaneously
with this Agreement, the Company and the Executive are entering into an Amended
and Restated Change of Control Agreement (the “Change of Control Agreement”), which
agreement provides for certain forms of severance and benefit payments in the
event of termination of the Executive’s employment under certain defined
circumstances.  This Agreement is in
addition to the Change of Control Agreement, providing certain assurances to
the Executive in circumstances that the Change of Control Agreement does not
cover, and in no way supersedes or nullifies the Change of Control
Agreement.  Nevertheless, it is possible
that a termination of employment by the Company or by the Executive may fall
within the scope of both agreements.  In
such event, payments made to the Executive under Section 5.1 hereof shall
be coordinated with payments made to the Executive under Section 8.1 of
the Change of Control Agreement as follows:


 


(a)           Accrued Obligations
under this Agreement need not be paid if paid under the Change of Control
Agreement;


 


(b)           COBRA Continuation
under this Agreement need not be provided if provided under the Change of
Control Agreement; and


 


(c)           the severance payment
required under Section 5.1(c) hereof (and paid pursuant to Section 5.5
hereof) need not be paid to the extent a severance payment is made under Section 8.1(d) of
the Change of Control Agreement in connection with a Change of Control under
the Change of Control Agreement that constitutes a change in the ownership or
effective control of the Company or in the ownership of a substantial portion
of the assets of the Company within the meaning of subsection (a)(2)(A)(v) of
Code Section 409A, i.e., the credit from Section 8.1(d) of the
Change of Control Agreement is applied as amounts become due under Section 5.5
hereof.


 


17.                               Excess
Parachute Payments


 


Unless
provided by Section 8.8 of the Change of Control Agreement, if any portion
of the payments or benefits under this Agreement or any other agreement or
benefit plan of the Company (including stock options) would be characterized as
an “excess parachute payment” to the Executive under Section 280G of the
Internal Revenue Code of 1986, as amended (the “Code”), the Executive shall be paid any
excise tax that the Executive owes under Code Section 4999 as a result of
such characterization, such excise tax to be paid to the Executive at


 


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least ten (10) days
prior to the date that the Executive is obligated to make the excise tax
payment.  The determination of whether
and to what extent any payments or benefits would be “excess parachute payments”
and the date by which any excise tax shall be due shall be determined in
writing by recognized tax counsel selected by the Company and reasonably
acceptable to the Executive.  Without
limitation on the foregoing, the payments made pursuant to this Section 17
shall be made no later than the end of the year following the year in which the
Executive remits such excise tax to the Internal Revenue Service.


 


18.                               Entire
Agreement


 


This Agreement
supersedes and replaces the Key Executive Severance Agreement, dated as of March 3,
2008, between the parties, and except as described in Section 16 hereof,
this Agreement constitutes the entire agreement between the Company and the
Executive with respect to the subject matter hereof, and all prior or
contemporaneous oral or written communications, understandings or agreements
between the Company and the Executive with respect to such subject matter are
hereby superseded and nullified in their entireties, except that the
Proprietary Information and Invention Agreement between the Executive and the
Company shall continue in full force and effect to the extent not superseded by
Section 7 hereof.


 


19.                               Withholding


 


The Company
may withhold from any amounts payable under this Agreement such federal, state
or local taxes as shall be required to be withheld pursuant to any applicable
law or regulation.


 


20.                               409A
Interpretation Provision


 


The parties
intend that this Agreement and the payments and benefits provided hereunder be
exempt from the requirements of Code Section 409A to the maximum extent
possible, whether pursuant to the short-term deferral exception described in Treasury
Regulation Section 1.409A-1(b)(4), the involuntary separation pay plan
exception described in Treasury Regulation Section 1.409A-1(b)(9)(iii), or
otherwise.  To the extent Code Section 409A
is applicable to this Agreement, the parties intend that this Agreement comply
with the deferral, payout and other limitations and restrictions imposed under
Code Section 409A.  Notwithstanding
anything herein to the contrary, this Agreement is intended to be interpreted
and operated to the fullest extent possible so that the payments and benefits
under this Agreement either shall be exempt from the requirements of Code Section 409A
or shall comply with the requirements of such provision; provided, however,
that notwithstanding anything to the contrary in this Agreement in no event
shall the Company be liable to the Executive for or with respect to any taxes,
penalties or interest that may be imposed upon the Executive pursuant to Code Section 409A.


 


20.1        Payments
to Specified Employees


 


To the extent
that any payment or benefit pursuant to this Agreement constitutes a 409A
Payment treated as payable upon Separation from Service, then, if on the date
of the Executive’s Separation from Service, the Executive is a Specified
Employee, then to the extent required for the Executive not to incur additional
taxes pursuant to Code Section 409A, no such 409A Payment shall be made to
the Executive earlier than the earlier of (a) six (6) months after
the


 


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Executive’s
Separation from Service or (b) the date of the Executive’s death.  Should this Section 20 result in the
delay of benefits, any such benefit shall be made available to the Executive by
the Company during such delay period at the Executive’s expense.  Should this Section 20.1 result in a
delay of payments or benefits to the Executive, on the first day any such
payments or benefits may be made without incurring additional tax pursuant to
Code Section 409A (“409A Payment Date”),
the Company shall make such payments and provide such benefits as provided for
in this Agreement, provided that any amounts that would have been payable
earlier but for the application of this Section 20.1 as well as
reimbursement of the amount the Executive paid for benefits pursuant to the
preceding sentence, shall be paid in a lump sum on the 409A Payment Date.  For purposes of this Section 20.1, the
term “Specified Employee” shall
have the meaning set forth in Code Section 409A, as determined in
accordance with the methodology established by the Company.


 


20.2        Reimbursements


 


For purposes
of complying with Code Section 409A and without extending the payment
timing otherwise provided in this Agreement, taxable reimbursements under this
Agreement, subject to the following sentence and to the extent required to
comply with Code Section 409A, will be made no later than the end of the
calendar year following the calendar year the expense was incurred.  To the extent required to comply with Code Section 409A,
any taxable reimbursements and any in-kind benefit under this Agreement will be
subject to the following:  (a) payment
of such reimbursements or in-kind benefits during one calendar year will not
affect the amount of such reimbursements or in-kind benefits provided during
any other calendar year (other than for medical reimbursement arrangements as
excepted under Treasury Regulation Section 1.409A-3(i)(1)(iv)(B) solely
because the arrangement provides for a limit on the amount of expenses that may
be reimbursed under such arrangement over some or all of the period the
arrangement remains in effect); (b) such right to reimbursements or
in-kind benefits is not subject to liquidation or exchange for another form of
compensation to the Executive, and (c) the right to reimbursements under
this Agreement will be in effect for the lesser of the time specified in this
Agreement or ten (10) years plus the lifetime of the Executive.  Any taxable reimbursements or in-kind
benefits shall be treated as not subject to Code Section 409A to the
maximum extent provided by Treasury Regulation Section 1.409A-1(b)(9)(v) or
otherwise under Code Section 409A.


 


20.3        Release


 


Subject to Section 20.1
hereof, (a) to the extent that the Executive is required to execute and
deliver a release to receive a 409A Payment and (b) this Agreement
provides for such 409A Payment to be provided prior to the 55th day following
the Executive’s Separation from Service, such 409A Payment will be provided
upon the 55th day following the Executive’s Separation from Service, provided
that the release in the form acceptable to the Company, in its sole discretion,
has been executed, delivered and effective prior to such time.  To the extent there is a delay in providing a
409A Payment because of the provisions of this Section 20.3, interest for
the delay and the opportunity for the Executive to pay for benefits in the
interim with subsequent reimbursement from the Company shall be provided in a
manner consistent with that set forth in Section 20.1 hereof.  If a release is required for a 409A Payment and
such release is not executed, delivered and effective by the 55th day following
the Executive’s Separation from


 


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Service, such
409A Payment shall not be provided to the Executive to the extent that providing
such 409A Payment would cause such 409A Payment to fail to comply with Code Section 409A.


 


20.4        No
Acceleration; Separate Payments


 


No 409A
Payment payable under this Agreement shall be subject to acceleration or to any
change in the specified time or method of payment, except as otherwise provided
under this Agreement and consistent with Code Section 409A.  If under this Agreement, a 409A Payment is to
be paid in two (2) or more installments, for purposes of Section 409A,
each installment shall be treated as a separate payment.


 


21.                               Counterparts


 


This Agreement
may be executed in counterparts, each of which counterpart shall be deemed an
original, but all of which together shall constitute one and the same
instrument.


 


IN WITNESS
WHEREOF, the parties have executed and entered into this Agreement effective on
the date first set forth above.


 


 


	
   

  	
  PONIARD PHARMACEUTICALS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald McMahon

  
	
   

  	
   

  	
  Name: Gerald McMahon

  
	
   

  	
   

  	
  Its: Chairman &
  CEO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Cheni
  Kwok

  
	
   

  	
   

  	
  Name: Cheni
  Kwok

  



 


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