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

(e) Approval of Bonus Plan

On May 29, 2009, the Board of Directors of Targeted Genetics Corporation (the "Company") approved a bonus plan (the "Plan") applicable to the Company's senior management, including the Company's two named executive officers and the Company's other two vice presidents ("Senior Management"). The Plan provides for bonus payments to Senior Management upon the achievement by the Company of a program-related performance milestone, including a bonus of $40,000 for the Company's chief executive officer and a bonus of $25,000 for the Company's chief financial officer. The Plan also provides for bonus payments to Senior Management in the event the Company obtains a specified minimum amount in additional outside funding. If earned, the bonus amount paid to Senior Management as a group would be $150,000 to $750,000, depending on the amount of funding received by the Company. Additional sources of outside funding could include strategic transactions, such as mergers and acquisitions; issuing equity or debt; selling or licensing technology or product candidates; extending or expanding current product development or manufacturing collaborations, or entering into additional product development or manufacturing collaborations; or other transactions.

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