8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 16, 2012

THRESHOLD PHARMACEUTICALS, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-32979	94-3409596
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

170 Harbor Way, Suite 300
South San Francisco, California 94080

(Address of principal executive offices)(Zip Code)

(650) 474-8200

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(c) On February 16, 2012, Tillman Pearce, M.D., joined Threshold Pharmaceuticals, Inc. (the Company) as Chief Medical Officer. Dr. Pearce will receive an annual salary of $350,000 and was also granted a stock option to purchase 250,000 shares of the Company’s common stock under the Company’s 2004 Amended and Restated Equity Incentive Plan, at an exercise price of $3.46 per share, which was the closing price of the Company’s common stock on the Nasdaq Stock Market on February 16, 2012, the starting date of his employment. The option will vest with respect to 25% of the shares on the first anniversary of Dr. Pearce’s starting date with the Company, and with respect to 1/48^th of the shares on each subsequent month. Additionally, Dr. Pearce will be eligible to receive an annual performance-based bonus of up to 35% of his base salary. Dr. Pearce will also be eligible to receive certain change of control and severance benefits pursuant to a separate change of control agreement that will be entered separately. Starting one-year after his starting date, Dr. Pearce will also be eligible to receive additional severance benefits.

Dr. Pearce, age 54, served as Chief Medical Officer of KaloBios Pharmaceuticals, Inc., from 2007 through 2011, and since 2011 has been an oncology consultant. Prior to KaloBios, Dr. Pearce was a Senior Director at PDL BioPharma from 2002 to 2007 and a Medical Director in the Oncology Business Unit at Sanofi-Synthelabo from 1997 to 2002. He has also held research positions in oncology at Sandoz and Novartis. Dr. Pearce holds a B.A. in philosophy from Tulane University and an M.D. from the Medical College of Georgia.

The foregoing description of the terms of Dr. Pearce’s employment with the Company is qualified in its entirety by reference to the Offer Letter dated February 16, 2012 by and between the Company and Dr. Pearce, a copy of which is attached hereto as Exhibit 10.27 to this Current Report on Form 8-K and is incorporated herein by reference.

On February 17, 2012, the Company issued a press release regarding Dr. Pearce’s appointment as described above. A copy of the press release is filed as Exhibit 99.1 to this Current Report on Form 8-K.

(e) The information set forth in the first paragraph above is incorporated by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit 10.27 Offer Letter dated February 16, 2012 by and between Threshold Pharmaceuticals, Inc. and Tillman Pearce, M.D.

Exhibit 99.1 Press release dated February 17, 2012.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

THRESHOLD PHARMACEUTICALS, INC.
By:	/s/ Joel A. Fernandes
	Joel A. Fernandes
	Vice President, Finance and Controller

Date: February 21, 2012

Exhibit Index

Exhibit No.	Description
Exhibit 10.27	Offer Letter dated February 16, 2012 by and between Threshold Pharmaceuticals, Inc. and Tillman Pearce, M.D.
Exhibit 99.1	Press release dated February 17, 2012.

EX-10.27

Exhibit 10.27

February 13, 2012

Tillman Pearce, M.D.

6 Mint Plaza

San Francisco, CA 94103

Re: Revised Employment Terms

Dear Tillman,

This letter confirms that Threshold Pharmaceuticals, Inc. (the “Company”) is pleased to offer you the position of Chief Medical Officer, beginning on Thursday, February 16, 2012 and on the following terms:

You will report to the company’s Chief Executive Officer and work at our facility located at 170 Harbor Way, Suite 300, South San Francisco, CA 94080. Of course, the Company may change your position, duties and work location from time to time as it deems necessary.

Your compensation will be $14,583.34 per pay period, which is equivalent to $350,000 on an annualized basis, less all required withholdings and voluntary payroll deductions. You will be paid semi-monthly and will be eligible for standard Company benefits as outlined on the attached Employee Benefits Program summary. The Company may modify compensation and benefits from time to time as it deems necessary.

You will also be awarded a stock option grant to purchase 250,000 shares of the Company's Common Stock subject to a four year vesting schedule as follows: (a) the first 25% of this grant shall vest at your first anniversary of your starting date with the Company and (b) thereafter an additional 1/48th of the grant shall vest on each subsequent monthly anniversary of your starting date. The exercise price of this stock option will be the closing sales price of the Company’s common stock on the NASDAQ National Market on the date you commence your employment with the Company. As a Company employee, you will be expected to abide by Company rules and regulations, sign and comply with the attached Proprietary Information and Inventions Agreement which prohibits unauthorized use or disclosure of Company proprietary information, sign and comply with the Company Insider Trading Policy and, acknowledge in writing that you have read the Company’s Employee Handbook.

You will be eligible to receive an annual performance-based bonus of up to 35% of your base salary. This bonus will be awarded at the sole discretion of the Board of Directors.

You will be immediately eligible to receive change of control and severance benefits pursuant to the Change of Control that is provided separately. Full severance benefits, upon termination for good reason, will not become available until your one year anniversary.

With prior approval, the Company agrees for you to engage in consulting work with outside enterprises in which there are no conflicts of interest as determined by the Company. Please reference the attached email dated February 13, 2012 for detailed approval of your outside consulting work.

In your work for the Company, you will be expected not to use or disclose any confidential information, including trade secrets, of any former employer or other person to whom you have an obligation of confidentiality. Rather, you will be expected to use only that information which is generally known and used by persons with training and experience comparable to your own, which is common knowledge in the industry or otherwise legally in the public domain, or which is otherwise provided or developed by the Company. During our discussions about your proposed job duties, you assured us that you would be able to perform those duties within the guidelines just described.

You agree that you will not bring onto Company premises any unpublished documents or property belonging to any former employer or other person to whom you have an obligation of confidentiality.

You may terminate your employment with the Company at any time and for any reason whatsoever simply by notifying the Company. Likewise, the Company may terminate your employment at any time and for any reason whatsoever, with or without cause or advance notice. As required by law, this offer is subject to satisfactory proof of your right to work in the United States. A “Lists of Acceptable Documents” for employment eligibility verification is attached for your information.

This letter, together with your Proprietary Information and Inventions Agreement, forms the complete and exclusive statement of your employment agreement with the Company. The employment terms in this letter supersede any other agreements or promises made to you by anyone, whether oral or written. This letter agreement cannot be changed except in writing signed by you and a duly authorized officer of the Company.

Please indicate your acceptance of our offer by signing below and returning the original copy of this letter of employment from Threshold Pharmaceuticals under the terms described above. This offer will remain until end of day Friday, February 24, 2012. Should you have any questions, please contact me at (650) 474-8205.

We look forward to your favorable reply and to a productive and enjoyable work relationship.

Sincerely,

/s/ Harold E. Selick, Ph.D.

Harold E. Selick, Ph.D.

Chief Executive Officer

Accepted:

/s/Tillman Pearce, M.D.	February 16, 2012
Tillman Pearce, M.D.	Date

Enclosures: Proprietary Information and Inventions Agreement

Insider Trading Policy

Employee Benefits Summary

I-9 List of Acceptable Documents

EX-99.1

PRESS RELEASE

Contact:

Joel A. Fernandes
Threshold Pharmaceuticals, Inc.

650.474.8273

IR@thresholdpharm.com

THRESHOLD PHARMACEUTICALS APPOINTS DR. TILLMAN PEARCE AS CHIEF MEDICAL OFFICER

SOUTH SAN FRANCISCO, CA – February 17, 2012 -- Threshold Pharmaceuticals, Inc. (Nasdaq: THLD) today announced the appointment of Tillman Pearce, M.D. as its Chief Medical Officer. In this position, Dr. Pearce will oversee the development of Threshold’s TH-302, a clinical stage hypoxia-targeted cancer therapeutic currently being evaluated in a variety of cancers, including a Phase 3 trial in patients with soft tissue sarcoma and a Phase 2b trial in patients with pancreatic cancer.

"Dr. Pearce’s experience in oncology drug development, from the perspectives of large pharmaceutical as well as smaller entrepreneurial biotech companies, will be a significant addition to Threshold," stated Barry Selick, Ph.D., Chief Executive Officer of Threshold. "We enthusiastically welcome Tillman to the team and look forward to his contributions as we advance the development of TH-302 while building our new partnership with Merck KGaA. At this time, we also want to acknowledge and thank Dr. Sam Saks who joined us as interim CMO immediately following Dr. John Curd’s sudden passing last Spring.  Sam's insight into oncology drug development in general and TH-302 in particular has been invaluable to us and he will continue to be a key advisor to Threshold.”

Dr. Pearce brings almost two decades of international experience in drug development, including the pre- and post-marketing development of a variety of novel therapeutics for the treatment of solid tumors and hematologic malignancies as well as for inflammatory and infectious diseases. He served in senior managerial posts including Director of Oncology Clinical Research for Sandoz/Novartis where he worked on Phase 1-3 studies of PSC833 in hematologic malignancies and solid tumor indications, Medical Director at Sanofi-Synthelabo’s Oncology Business Unit during the international launch of Eloxatin for the treatment of colorectal cancer, and he established and directed PDL BioPharma France, which was responsible for PDL's clinical activities throughout Europe. Most recently, Dr. Pearce served as Chief Medical Officer of KaloBios Pharmaceuticals.

“I am excited to join the Threshold team and have the opportunity to help bring a truly innovative therapy to market. TH-302 has the potential to significantly benefit cancer patients and I’m looking forward to playing a role in supporting the development of this promising drug candidate,” said Dr. Pearce.

Dr. Pearce has a Bachelor's degree in philosophy from Tulane University, New Orleans, LA, and a medical degree from the Medical College of Georgia, Augusta, GA. Dr. Pearce is a board certified internist and hematologist.

About Threshold Pharmaceuticals

Threshold is a biotechnology company focused on the discovery and development of drugs targeting Tumor Hypoxia, the low oxygen condition found in microenvironments of most solid tumors as well as the bone marrows of some hematologic malignancies. This approach offers broad potential to treat a variety of cancers. By selectively targeting tumor cells, we are building a pipeline of drugs that hold promise to be more effective and less toxic to healthy tissues than conventional anticancer drugs. For additional information, please visit our website (www.thresholdpharm.com).

  

Forward-Looking Statements

Except for statements of historical fact, the statements in this press release are forward-looking statements, including statements regarding TH-302's potential uses and benefits and current and planned clinical trials of TH-302. These statements involve risks and uncertainties that can cause actual results to differ materially from those in such forward-looking statements. Potential risks and uncertainties include, but are not limited to, Threshold's ability to enroll or complete its anticipated clinical trials, the time and expense required to conduct such clinical trials and analyze data, whether such trials confirm results from earlier trials and preclinical studies, potential side effects associated with TH-302, issues arising in the regulatory or manufacturing process and the results of such clinical trials (including product safety issues and efficacy results), and Threshold's ability to raise additional capital to continue funding its operations. Further information regarding these and other risks is included under the heading "Risk Factors" in Threshold's Quarterly Report on Form 10-Q, which has been filed with the Securities Exchange Commission on November 3, 2011 and is available from the SEC's website (www.sec.gov) and on our website (www.thresholdpharm.com) under the heading "Investors." We undertake no duty to update any forward-looking statement made in this news release.

###