Document:

Exhibit 10.22

 

PONIARD
PHARMACEUTICALS, INC.

AMENDED
AND RESTATED

CHANGE
OF CONTROL AGREEMENT

(SENIOR
EXECUTIVE)

 

This Amended and Restated Change of Control
Agreement (Senior Executive) (this “Agreement”),
dated as of March 3, 2008,
is entered into by and between PONIARD PHARMACEUTICALS, INC., a Washington
corporation (formerly known as NeoRx Corporation and as supplemented by Section 13,
the “Company”), and RONALD MARTELL (the “Executive”).

 

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 possibility, threat or occurrence of a Change of Control
(as defined in Section 1 hereof) of the Company.  The Board believes it is imperative to
diminish the inevitable distraction of the Executive arising from the personal
uncertainties and risks created by a pending or threatened Change of Control,
to encourage the Executive’s full attention and dedication to the Company
currently and in the event of any threatened or pending Change of Control, and
to provide the Executive with reasonable compensation and benefit arrangements
upon a Change of Control.

 

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

 

1.             Definitions

 

1.1           “Change of Control” shall have the definition set forth
in Appendix A hereto, which is hereby incorporated by reference.

 

1.2           “Change of Control Date” shall mean the first date on
which a Change of Control occurs.

 

1.3           “Employment Period” shall mean the two (2) year
period commencing on the Change of Control Date and ending on the second
anniversary of such date.

 

1.4           “Original Agreement” shall mean the Change of Control
Agreement, dated as of May 7, 2007, between the parties.

 

1.5           “Severance Agreement” shall mean the Amended and Restated
Key Executive Severance Agreement, dated as of the date hereof, between the
parties, as it may be amended from time to time, that provides for certain
benefits related to termination of the Executive’s employment that are
unrelated to a Change of Control.

 

 

2.             Term

 

The initial term of this Agreement (“Initial Term”) shall be for a period of one (1) year
from the date 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 at least ninety (90) days
prior to the end of the Initial Term or any Renewal Term, and provided further
that if a Change in Control occurs during the Term, the Term shall
automatically extend for the duration of the Employment Period.  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.

 

3.             Employment

 

3.1          Employment
Period

 

During
the Employment Period, the Company hereby agrees to continue the Executive in
its employ or in the employ of its affiliated companies, and the Executive
hereby agrees to remain in the employ of the Company or its affiliated
companies, in accordance with the terms and provisions of this Agreement;
provided, however, that either the Company or the Executive may terminate the
employment relationship subject to the terms of this Agreement.

 

3.2          Position
and Duties

 

During
the Employment Period, the Executive’s position, authority, duties and
responsibilities shall be at least commensurate in all material respects with
the most significant of those held, exercised and assigned at any time during
the ninety (90) day period immediately preceding the Change of Control Date.

 

3.3          Location

 

During
the Employment Period, the Executive’s services shall be performed at the
Company’s offices on the Change of Control Date at which the Executive was
employed or any office that is subsequently designated by the Company and is
less than thirty (30) miles from such location.

 

3.4          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 its 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.  Moreover, if prior to the Change of Control
Date, the Executive’s

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employment
with the Company or its affiliated companies terminates for any reason, then
the Executive shall have no further rights under this Agreement; provided,
however, that the Company may not avoid liability for any termination payments
that would have been required during the Employment Period pursuant to Section 8
hereof by terminating the Executive prior to the Employment Period where such
termination is carried out in anticipation of a Change of Control and the
principal motivating purpose is to avoid liability for such termination
payments.

 

4.             Attention and Effort

 

During
the Employment Period, 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 use the Executive’s reasonable best efforts 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 Employment Period, the continued conduct
of such activities (or the conduct of activities similar in nature and scope
thereto) during the Employment Period shall not thereafter be deemed to
interfere with the performance of the Executive’s responsibilities to the
Company.

 

5.             Compensation

 

As
long as the Executive remains employed by the Company during the Employment
Period, the Company agrees to pay or cause to be paid to the Executive, and the
Executive agrees to accept in exchange for the services rendered hereunder by the
Executive, the following compensation:

 

5.1          Salary

 

The
Executive shall receive an annual base salary (the “Annual
Base Salary”), at least equal to the annual salary established
by the Board or the Compensation Committee of the Board (the “Compensation
Committee”) or the Chief Executive Officer for the fiscal year
in which the Change of Control Date occurs. 
The Annual Base Salary shall be paid in substantially equal installments
and at the same intervals as the salaries of other executives of the Company
are paid.  The Board or the Compensation
Committee or the Chief Executive Officer shall review the Annual Base Salary at
least annually and shall determine in good faith and consistent with any
generally applicable Company policy any increases for future years.

 

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5.2          Bonus

 

In
addition to the Annual Base Salary, the Executive shall be awarded, for each
fiscal year ending during the Employment Period, an annual performance bonus
(the “Annual Performance Bonus”) in
cash at least equal to the average annualized (for any fiscal year consisting
of less than twelve (12) full months) bonus paid or payable to the Executive by
the Company and its affiliated companies in respect of the Executive’s
performance during the three fiscal years (or such shorter period of
employment) immediately preceding the fiscal year in which the Change of
Control Date occurs.  Each Annual
Performance Bonus shall be paid in the fiscal year following the fiscal year
for which the Annual Performance Bonus is awarded, but no later than the
fifteenth day of the third month of such subsequent fiscal year, unless the
Executive shall elect to defer the receipt of the Annual Performance Bonus in
accordance with the terms of the Company’s deferred compensation program.

 

6.             Benefits

 

6.1          Incentive, Retirement and Welfare Benefit Plans; Vacation

 

As
long as the Executive remains employed by the Company during the Employment
Period, the Executive shall be entitled to participate, subject to and in
accordance with applicable eligibility requirements, in such fringe benefit
programs as shall be generally made available to other executives of the
Company and its affiliated companies from time to time during the Employment
Period by action of the Board (or any person or committee appointed by the Board
to determine fringe benefit programs and other emoluments), including, without
limitation, paid vacations; any stock purchase, savings or retirement plan,
practice, policy or program; and all welfare benefit plans, practices, policies
or programs (including, without limitation, medical, prescription, dental,
disability, salary continuance, employee life, group life, accidental death and
travel accident insurance plans or programs).

 

6.2          Expenses

 

As
long as the Executive remains employed by the Company during the Employment
Period, the Executive shall be entitled to receive prompt reimbursement for all
reasonable employment expenses incurred by the Executive in accordance with the
policies, practices and procedures of the Company and its affiliated companies
in effect for the executives of the Company and its affiliated companies during
the Employment Period.  Without
limitation on the foregoing, reimbursement shall be made no later than the end
of the fourth month of the year following the year in which the expense was
incurred.

 

7.             Termination

 

During
the Employment Period, employment of the Executive may be terminated as
follows, but, in any case, the nondisclosure provisions set forth in Section 10
hereof shall survive the termination of this Agreement and the termination of
the Executive’s employment with the Company:

 

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7.1          By
the Company or the Executive

 

At
any time during the Employment Period, 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 the Notice of Termination (as defined below).

 

7.2          Automatic
Termination

 

This
Agreement and the Executive’s employment during the Employment Period 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 duties set forth in Section 3.2
hereof 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.  The Executive and the Company hereby
acknowledge that the duties specified in Section 3.2 hereof are essential
to the Executive’s position and that Executive’s ability to perform those
duties is the essence of this Agreement.

 

7.3          Notice
of Termination

 

Any
termination by the Company or by the Executive during the Employment Period
shall be communicated by the Notice of Termination to the other party given in
accordance with Section 12 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 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.

 

7.4          Date
of Termination

 

During
the Employment Period, “Date of Termination” means (a) if
the Executive’s employment is terminated by reason of death, at the end 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 

 

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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.

 

8.             Termination Payments

 

In
the event of termination of the Executive’s employment during the Employment
Period, all compensation and benefits set forth in this Agreement shall
terminate except as specifically provided in this Section 8.

 

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

 

If
during the Employment Period 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 Annual Base Salary through the Date of
Termination to the extent not theretofore paid;

 

(ii)           the product of (x) the Annual Performance Bonus payable with
respect to the fiscal year in which the Date of Termination occurs and (y) a
fraction the numerator of which is the number of days in the current fiscal
year through the Date of Termination, and the denominator of which is three
hundred sixty-five (365);

 

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

 

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

 

(b)           for one year after the Date of Termination or until the Executive
qualifies for comparable medical and dental insurance benefits from another
employer, whichever occurs first, the Company shall pay the Executive’s
premiums for health insurance benefit continuation for the Executive and the
Executive’s family members, if applicable, which 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”);

 

(c)           an amount as severance pay equal to one (1) times the Annual
Performance Bonus payable with respect to the fiscal year in which the Date of
Termination occurs;

 

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(d)           an amount as severance pay equal to one (1) times the Annual Base
Salary for the fiscal year in which the Date of Termination occurs; and

 

(e)           immediate vesting of all outstanding stock options previously granted
to the Executive by the Company.

 

8.2          Termination
for Cause or Other Than for Good Reason

 

If
during the Employment Period 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 (a) the
Annual Base Salary through the Date of Termination, (b)  the amount of any
compensation previously deferred by the Executive in accordance with the terms
of the Company’s deferred compensation program, and (c) any accrued
vacation pay that would be payable under the Company’s standard policy, in each
case to the extent theretofore unpaid.

 

8.3          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, other than the Company’s obligation to pay the
Executive the product of (a) the Annual Performance Bonus payable with
respect to the fiscal year in which the Term expired and (b) a fraction
the numerator of which is the number of days in the current fiscal year through
the end of the Term and the denominator of which is three hundred sixty-five
(365).  Such payment will be made in the
fiscal year following the fiscal year in which the Term expired no later than
the fifteenth day of the third month of such subsequent fiscal year.

 

8.4          Termination
Because of Death or Total Disability

 

If
during the Employment Period 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.

 

8.5          Payment
Schedule

 

All
payments of Accrued Obligations, or any portion thereof payable pursuant to
this Section 8, other than deferred compensation pursuant to Section 8.1(a)(iii),
shall be made to the Executive within ten (10) working days of the Date of
Termination.  Deferred compensation
pursuant to Section 8.1(a)(iii) shall be payable pursuant to the
terms of the deferred compensation program. 
Any payments payable to the Executive pursuant to 

 

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Section 8.1(c) and
(d) hereof shall be made to the Executive in a lump sum within ten (10) working
days of the Date of Termination.  For
purposes of determining the payment schedule, other than for deferred
compensation pursuant to Section 8.1(a)(iii), to the extent 

that
the payment schedule in this Section 8.5 would subject payments to the
distribution requirements set forth in Section 409A(a)(2) of the
Internal Revenue Code of 1986, as amended (“Code”), because the Date of
Termination is different than the date that a person would be deemed to have
had a separation from service within the meaning of Code Section 409A(a)(2)(i),
the Date of Termination shall be treated as the latest date so as to not
subject such payments to the distribution requirements set forth in Code Section 409A(a)(2).  Notwithstanding the preceding provisions of
this Section 8, if necessary to meet the requirements of subparagraphs (A)(i) and
(B)(i) of Code Section 409A(a)(2), the amounts that would normally be
paid during the first six months after the Executive’s separation from service
within the meaning of Code Section 409A(a)(2) shall not be paid to an
Executive who is a specified employee (as defined in Code Section 409A(a)(2)(B)(i) in
accordance with the procedures established by the Compensation Committee) until
the six-month anniversary of the Executive’s separation from service.

 

8.6          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,
all reasonably consistent with the duties described in Section 3.2 hereof;

 

(b)           persistent failure to carry out any lawful duties of the Executive
described in Section 3.2 hereof or any directions of the Board or senior
management reasonably consistent with the duties herein set forth to be
performed by the Executive, 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 11
hereof.

 

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8.7          Good
Reason

 

For
purposes of this Agreement, “Good Reason” means

 

(a)           the assignment to the Executive of any duties materially inconsistent
with the Executive’s position, authority, duties or responsibilities as
contemplated by Section 3.2 hereof 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;

 

(b)           any failure by the Company to comply with any of the provisions of Section 5
or Section 6 hereof, other than an isolated and inadvertent failure 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 other than that described in Section 3.3 hereof;

 

(d)           any failure by the Company to comply with and satisfy Section 13
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 13 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 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 11 hereof.

 

8.8          Excess
Parachute Limitation

 

If
any portion of the payments or benefits for the Executive under this Agreement,
the Severance Agreement, or any other agreement or benefit plan of the Company
(including stock option plan) 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 Section 4999 of the
Code as a result of such characterization, such excise tax to be paid to the
Executive at 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 

 

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Section 8.8
shall be made no later than the end of the year following the year in which the
Executive remits such excise tax to the IRS.

 

8.9          Release

 

As a condition to receiving the payments and
benefits under this Section 8, the Executive shall execute a general
release and waiver of all claims against the Company, which release and waiver
shall be in a form acceptable to the Company, in its reasonable discretion, and
delivered to the Company no later than the fifteenth day of the third month of
the fiscal year following the year in which the Date of Termination occurs.

 

9.             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:

 

9.1          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 the examination’s medical report shall be provided to the Company.

 

9.2          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
agreement or obligations by which the Executive may be bound.

 

10.          Nondisclosure; Return of Materials

 

10.1        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 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 compensation, granting the Executive any
promotions or raises, or entrusting the Executive with any information that
helps the Company compete with others.

 

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10.2        Return
of Materials

 

All
documents, records, notebooks, notes, memoranda, drawings or other documents
made or compiled by the Executive at any time, 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.

 

11.          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 8.6
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.

 

12.          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:

  	
   

  	
  Ronald Martell

  
	
   

  	
   

  	
  [Address]

  
	
   

  	
   

  	
   

  
	
  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, 48th
  Floor

  
	
   

  	
   

  	
  Seattle, Washington
  98101-3099

  
	
   

  	
   

  	
  Attn: James R. Lisbakken

  

 

Except
as set forth in Section 7.4 hereof, if notice is mailed, such notice shall
be effective upon mailing.

 

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13.          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 successor to its business
and/or assets as aforesaid that assumes and agrees to perform this Agreement by
operation of law, or otherwise.  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.

 

14.          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
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.

 

15.          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.

 

16.          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.

 

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17.          Arbitration; Attorneys’ Fees

 

Except
in connection with enforcing Section 10 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 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 to 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 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.

 

18.          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.

 

19.          Entire Agreement

 

This
Agreement supersedes and replaces the Original Agreement, and except as
described in Section 23 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 

 

13

 

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 Company and the Executive shall continue in
full force and effect to the extent not superseded by Section 10 hereof.

 

20.          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.

 

21.          409A Interpretation Provision

 

The Company intends that
this Agreement fully comply with the payout and other limitations and
restrictions imposed under Code Section 409A if and to the extent such
Code Section 409A is otherwise applicable to payments under this Agreement
and such compliance is necessary to avoid the penalties otherwise imposed under
Code Section 409A.  In this
connection, the Company and Executive agree that the payout timing provisions
and any other terms of this Agreement shall be interpreted and deemed modified,
if and to the extent necessary, to comply with the payout and other limitations
and restrictions imposed under Code Section 409A if and to the extent such
Code Section 409A is otherwise applicable to this Agreement and such
compliance is necessary to avoid the penalties otherwise imposed under Code Section 409A.

 

22.          Counterparts

 

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

 

23.          Coordination with Severance Agreement

 

The
Severance Agreement that the parties entered into provides for certain forms of
severance and benefit payments in the event of termination of the Executive’s
employment.  This Agreement is in
addition to the Severance Agreement and in no way supersedes or nullifies the
Severance Agreement.  Nevertheless, it is
possible that 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 8.1
hereof shall be coordinated with payments made to the Executive under Section 5.1
of the Severance Agreement as follows:

 

(a)           Accrued Obligations under this Agreement shall be paid first, in which
case Accrued Obligations need not be paid under the Severance Agreement;

 

(b)           COBRA Continuation under this Agreement shall be provided first, in
which case COBRA Continuation need not be provided under the Severance Agreement;
and

 

14

 

(c)           the severance payment required under Section 8.1(d) hereof
shall be paid first, in which case only that portion of any severance payment
required under Section 5.1(c) of the Severance Agreement that is in
excess of the severance payment required under Section 8.1(d) hereof
shall be paid in accordance with the provisions of the Severance Agreement.

 

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/ Caroline Loewy

  
	
   

  	
   

  	
  Name: Caroline Loewy

  
	
   

  	
   

  	
  Its: Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ronald Martell

  
	
   

  	
   

  	
  Name: Ronald Martell

  
				

 

15

 

APPENDIX A

 

 

For
purposes of this Agreement, a “Change of Control”
shall mean:

 

(a)           A “Board Change” that, for
purposes of this Agreement, shall have occurred if a majority (excluding vacant
seats) of the seats on the Board are occupied by individuals who were neither (i) nominated
by a majority of the Incumbent Directors nor (ii) appointed by directors
so nominated.  An “Incumbent
Director” is a member of the Board who has been either (i) nominated
by a majority of the directors of the Company then in office or (ii) appointed
by directors so nominated, but excluding, for this purpose, any such individual
whose initial assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in former Rule 14a-11
of Regulation 14A promulgated under the Securities Exchange Act of 1934,
as amended (the “Exchange Act”)) or other
actual or threatened solicitation of proxies or consents by or on behalf of a
Person (as hereinafter defined) other than the Board; or

 

(b)           The acquisition by any individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of (i) twenty percent (20%) or more of
either (A) the then outstanding shares of Common Stock of the Company (the
“Outstanding Company Common Stock”) or (B) the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the “Outstanding
Company Voting Securities”), in the case of either (A) or (B) of
this clause (i), which acquisition is not approved in advance by a majority of
the Incumbent Directors, or (ii) thirty-three percent (33%) or more of
either (A) the Outstanding Company Common Stock or (B) the
Outstanding Company Voting Securities, in the case of either (A) or (B) of
this clause (ii), which acquisition is approved in advance by a majority of the
Incumbent Directors; provided, however, that the following acquisitions shall
not constitute a Change of Control:  (x) any
acquisition by the Company, (y) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company, or (z) any acquisition by any
corporation pursuant to a reorganization, merger or consolidation, if,
following such reorganization, merger or consolidation, the conditions
described in clauses (i), (ii) and (iii) of subsection (c) of
this Appendix A are satisfied; or

 

(c)           Approval by the shareholders of the Company of a reorganization, merger
or consolidation, in each case, unless, immediately following such
reorganization, merger or consolidation, (i) more than sixty percent (60%)
of, respectively, the then outstanding shares of common stock of the
corporation resulting from such reorganization, merger or consolidation and the
combined voting power of the then outstanding voting securities of such
corporation entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or substantially all the
individuals and entities who were 

 

 

the
beneficial owners, respectively, of the Outstanding Company Common Stock and
the Outstanding Company Voting Securities immediately prior to such
reorganization, merger or consolidation in substantially the same proportion as
their ownership immediately prior to such reorganization, merger or
consolidation of the Outstanding Company Common Stock and the Outstanding
Company Voting Securities, as the case may be, (ii) no Person (excluding
the Company, any employee benefit plan (or related trust) of the Company or
such corporation resulting from such reorganization, merger or consolidation
and any Person beneficially owning, immediately prior to such reorganization,
merger or consolidation, directly or indirectly, thirty-three percent (33%) or
more of the Outstanding Company Common Stock or the Outstanding Company Voting
Securities, as the case may be) beneficially owns, directly or indirectly,
thirty-three percent (33%) or more of, respectively, the then outstanding
shares of common stock of the corporation resulting from such reorganization,
merger or consolidation or the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in the election of
directors, and (iii) at least a majority of the members of the board of
directors of the corporation resulting from such reorganization, merger or
consolidation were the Incumbent Directors at the time of the execution of the
initial agreement providing for such reorganization, merger or consolidation;
or

 

(d)           Approval by the shareholders of the Company of (i) a complete
liquidation or dissolution of the Company or (ii) the sale or other
disposition of all or substantially all the assets of the Company, other than
to a corporation with respect to which immediately following such sale or other
disposition, (A) more than sixty percent (60%) of, respectively, the then
outstanding shares of common stock of such corporation and the combined voting
power of the then outstanding voting securities of such corporation entitled to
vote generally in the election of directors is then beneficially owned,
directly or indirectly, by all or substantially all the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Company Common Stock and the Outstanding Company Voting Securities immediately
prior to such sale or other disposition in substantially the same proportion as
their ownership, immediately prior to such sale or other disposition, of the
Outstanding Company Common Stock and the Outstanding Company Voting Securities,
as the case may be, (B) no Person (excluding the Company, any employee
benefit plan (or related trust) of the Company or such corporation and any
Person beneficially owning, immediately prior to such sale or other
disposition, directly or indirectly, thirty-three percent (33%) or more of the
Outstanding Company Common Stock or the Outstanding Company Voting Securities,
as the case may be) beneficially owns, directly or indirectly, thirty-three
percent (33%) or more of, respectively, the then outstanding shares of common
stock of such corporation and the combined voting power of the then outstanding
voting securities of such corporation entitled to vote generally in the
election of directors, and (C) at least a majority of the members of the
board of directors of such corporation were approved by a majority of the
Incumbent Directors at the time of the execution of the initial agreement or
action of the Board providing for such sale or other disposition of the Company’s
assets.

 

2Exhibit 10.24

 

PONIARD PHARMACEUTICALS,
INC.

AMENDED AND RESTATED

KEY EXECUTIVE SEVERANCE AGREEMENT

 

This Amended and Restated Key Executive Severance
Agreement (this “Agreement”), dated as of March 3,
2008, is entered into by and between PONIARD PHARMACEUTICALS, INC., a
Washington corporation (formerly known as NeoRx Corporation and as supplemented
by Section 10, the “Company”), and CAROLINE LOEWY
(the “Executive”).

 

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

 

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 by
any affiliated or successor company 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                               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 Notice of Termination (as defined
below).

 

4.2                               Automatic Termination

 

This Agreement and the Executive’s employment 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 

 

2

 

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 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 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.

 

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”):

 

3

 

(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;

 

(b)                                 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
Company shall pay 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 the Executive’s employment is terminated during the
Term 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 

 

4

 

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), 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) 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) 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 (“Payment Period”). For
purposes of determining the payment schedule, other than for deferred
compensation pursuant to Section 5.1(a)(ii), to the extent that the
payment schedule in this Section 5.5 would subject payments to the
distribution requirements set forth in Section 409A(a)(2) of the
Internal Revenue Code of 1986, as amended (“Code”), because the Date of
Termination is different than the date that a person would be deemed to have
had a separation from service within the meaning of Code Section 409A(a)(2)(i),
the Date of Termination shall be treated as the latest date so as to not
subject such payments to the distribution requirements set forth in Code Section 409A(a)(2).
Notwithstanding the preceding provisions of this Section 5, if necessary
to meet the requirements of subparagraphs (A)(i) and (B)(i) of Code Section 409A(a)(2),
the amounts that would normally be paid during the first six months after the
Executive’s separation from service within the meaning of Code Section 409A(a)(2) shall
not be paid to an Executive  who is a
specified employee (as defined in Code Section 409A(a)(2)(B)(i) in
accordance with the procedures established by the Compensation Committee) until
the six-month anniversary of the Executive’s separation from service.

 

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 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;

 

5

 

(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)                                  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;

 

(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.

 

6

 

5.8                               General Release of Claims

 

As a condition to the payment contemplated by this Section 5,
the Executive shall execute a general release and waiver of claims against the
Company in a form satisfactory to the Company in its sole discretion. 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. Such
release and waiver shall be delivered to the Company no later than the
fifteenth day of the third month of the fiscal year following the year in which
the Date of Termination occurs.

 

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 (i) settlement by the parties, (ii) determination
by arbitration in accordance with Section 14 hereof that Good Reason did
not exist, and (iii) 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:

 

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, paid for and arranged by
the Company. The Executive agrees that the examination’s medical report shall
be provided to the Company.

 

7

 

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 agreement 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 without
the prior written consent of the Company. The Executive understands that the
Company will be relying on this covenant 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.

 

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:

 

8

 

	
   

  	
  If to the Executive:

  	
   

  	
  Caroline Loewy

  
	
   

  	
   

  	
   

  	
  [Address]

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  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, 48th
  Floor

  
	
   

  	
   

  	
   

  	
  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, the “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 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.

 

9

 

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 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.

 

10

 

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

 

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
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, 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 

 

11

 

Section 4999 of the Code as a result of such
characterization, such excise tax to be paid to the Executive at 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 IRS.

 

18.                               Entire Agreement

 

This Agreement supersedes and replaces the Key
Executive Severance Agreement, dated as of June 23, 2006, 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 10 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
Company intends that this Agreement fully comply with the payout and other
limitations and restrictions imposed under Code Section 409A if and to the
extent such Code Section 409A is otherwise applicable to payments under
this Agreement and such compliance is necessary to avoid the penalties
otherwise imposed under Code Section 409A. In this connection, the Company
and Executive agree that the payout timing provisions and any other terms of
this Agreement shall be interpreted and deemed modified, if and to the extent
necessary, to comply with the payout and other limitations and restrictions
imposed under Code Section 409A if and to the extent such Code Section 409A
is otherwise applicable to this Agreement and such compliance is necessary to
avoid the penalties otherwise imposed under Code Section 409A.

 

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.

 

12

 

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:  Chief
  Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Caroline Loewy

  
	
   

  	
  Name:  Caroline
  Loewy

  

 

13

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