Sunesis Pharmaceuticals, Inc. 2011 Bonus Program



 EXHIBIT 10.1 

SUNESIS PHARMACEUTICALS, INC. 
 2011 BONUS PROGRAM 
 Overview 

The 2011 Bonus Program (the “Program”) of Sunesis Pharmaceuticals, Inc. (the “Company”) is effective as of
January 1, 2011 (the “Effective Date”). The Program is designed to motivate, retain and reward Company employees through a combination of corporate and individual performance-based incentive compensation components from
the Effective Date through December 31, 2011 (the “Performance Period”). Individuals employed by the Company during the Performance Period who are designated for participation by the Compensation Committee of the
Company’s Board of Directors (the “Committee”) and who remain employed by the Company through the Payment Date (as defined below) (each a “Participant”) shall be eligible to earn a bonus under the
Program. The Program is administered by the Committee, and any decisions made in good faith by the Committee shall be final and binding on all Participants. 
 The Program is designed to award a cash bonus payment (each a “Cash Bonus”) for performance during the Performance Period to Participants based in part on the level of achievement
(1) by the Company of certain Company-wide objectives (the “Corporate Objectives”) and (2) by the Participant of certain individual performance objectives, which may include certain department, group and/or team
objectives applicable to such Participant (the “Individual Objectives”). 
 Program Objectives 

The Program is intended to encourage and reward the following: 
  

	 	•	 	 the achievement of Corporate Objectives, 


  

	 	•	 	 the achievement of Individual Objectives, 


 as well as to recognize individual contributions and effort. 
 Determination of Program
Objectives 
 The Corporate Objectives shall be approved by the Board of Directors. Each Corporate Objective category shall be assigned a
relative weighting from the Board of Directors, reflecting its importance to the achievement of the Company’s key results during the Performance Period; provided, however, the Board of Directors or the Committee may adjust the weighting
of the Corporate Objectives in its sole discretion at any time. 
 The Individual Objectives shall be set as follows: 

 

	 	•	 	 For the Chief Executive Officer, the Individual Objectives shall be set by the Committee; 



 

	 	•	 	 For Participants who are executive officers (as that term is defined under Section 16 of the Securities Exchange Act of 1934, as amended, and Rule
16a-1 thereunder), other than the Chief Executive Officer (collectively, the “ Executive Participants” ), the Individual Objectives shall be set by the Committee based upon recommendations made by the Chief Executive
Officer; and 


  

	 	•	 	 For non-Executive Participants (collectively, the “Non-Executive Participants”), the Individual Objectives shall be set by each
Participant’s immediate supervisor, with input from team leaders, group and department heads and others, as appropriate. 









 Program Bonus Targets 
 Under the Program, each Participant is eligible to earn a cash bonus in an amount up to a specified percentage of his or her annual base salary that is earned in 2011, with such percentage based in part
upon the position such Participant holds with the Company (the “Bonus Target”). Under the Program, the Bonus Targets range from 30% to 50% of a Participant’s 2011 base salary for Vice President level employees and above
and from 6% to 20% of a Participant’s 2011 base salary for other Participants. 
 Determination of Cash Bonus Payments 

The Company will determine the achievement of Corporate Objectives and Individual Objectives shortly after the end of the Performance Period, as follows:

 Determination of Level of Achievement of Corporate Objectives 
 The Committee shall determine, after receiving and considering analysis and recommendations from management, the degree to which the Corporate Objectives have been met, expressed as a percentage of
Corporate Objectives achieved, taking into consideration the weighting assigned to each Corporate Objective. Based on the percentage of Corporate Objectives achieved, the Committee will then determine the final aggregate bonus pool under the Program
for all Participants (the “Bonus Pool”). 
 Adjustment of Bonus Targets based on Level of Achievement of Corporate
Objectives 
 Bonus Target levels for Participants will be adjusted based on level of achievement of Corporate Objectives as determined by
the Committee. For example, if the Committee determines that only 80% of the Program’s Corporate Objectives are achieved, each Participant’s Bonus Target will be decreased by 20% (in other words, a Participant with a 10% Bonus Target will
have that Bonus Target reduced to 8%, or 80% of 10%.) Such adjusted Bonus Targets are referred to as the “Adjusted Bonus Targets.” 
 Determination of Bonus Payments for Individual Participants 
 The actual Cash Bonus earned
by a Participant is based on the Participant’s (i) level of contribution to the achievement of the Corporate Objectives; (ii) level of achievement by the Participant against his or her Individual Objectives and (iii) Adjusted
Bonus Target (or, if the Bonus Target was not adjusted, the original Bonus Target). There is no set formula for determining the amount of Cash Bonus earned based on the achievement of Individual Objectives or Corporate Objectives. Rather, the
Committee shall exercise its discretion in determining the amount of Cash Bonus actually earned, which determination will be final and binding. In making its determination, the Committee shall consider the following: 

 

	 	•	 	 For the Chief Executive Officer, the Committee’s own evaluation of his achievements; 



 

	 	•	 	 For Executive Participants, the recommendations made by the Chief Executive Officer; and 



 

	 	•	 	 For Non-Executive Participants, the recommendations made by members of the Executive Committee with input from team leaders, group and department heads
and supervisors, as appropriate. 


 In determining the actual Cash Bonus earned, the Committee may also take into account the
achievement of publicly announced targets, clinical milestones, strategic goals, cross-functional teamwork and collaboration, and unforeseen changes in the economy and/or geopolitical climate. 

Timing of Cash Payments Under the Program 
  







 Payment of Cash Bonuses under the Program is expected to occur in the first quarter
of 2012 following the conclusion of the Performance Period on such date as determined by the Committee in its sole discretion (the “Payment Date”). A Participant must remain employed by the Company through the Payment Date in
order to earn any Cash Bonus. In no event will the Payment Date occur later than the date that is the 15th day of the third calendar month of the year following the year in which the Cash Bonus is deemed to be earned, as the Program is intended to comply with Treasury Regulation Section 1.409A-1(b)(4)
and will be interpreted and administered in compliance therewith to the greatest extent possible. 
 Miscellaneous Provisions 

Participation in the Program shall not alter in any way the at will nature of the Company’s employment of a Participant, and such employment may be
terminated at any time for any reason, with or without cause and with or without prior notice. Nothing in this Program shall be construed to be a guarantee that any Participant will receive all or part of a Cash Bonus or to imply a contract between
the Company and any Participant. 
 This Program supersedes and replaces all prior cash incentive and bonus plans of the Company, other than the
Change of Control Payment Plan and severance plans (both Executive and Non-Executive). The Committee may amend or terminate this Program at any time, with or without notice. The Committee may likewise terminate an individual’s
participation in the Program at any time, with or without notice. Further, the Board of Directors or Committee may modify the Corporate Objectives, the Individual Objectives, the Bonus Targets and/or the weighting of the Corporate Objectives at any
time. 
 Any Cash Bonuses paid hereunder shall be subject to recoupment in accordance with The Dodd–Frank Wall Street Reform and Consumer
Protection Act and any implementing regulations thereunder, any clawback policy adopted by the Company or as is otherwise required by applicable law. 
 The Program shall be interpreted in accordance with California law without reference to conflicts of law principles.