EXHIBIT 10.88

 
RITA MEDICAL SYSTEMS, INC.
 
SEPARATION AGREEMENT AND MUTUAL RELEASE
 
This Separation Agreement and Mutual Release (“Agreement”) is made by and
between RITA Medical Systems, Inc., a Delaware corporation (the “Company”), and
Donald J. Stewart (“Mr. Stewart” or “Employee”).
 
WHEREAS, Mr. Stewart is employed by the Company pursuant to the terms of an
offer letter dated April 2, 2001, as amended on May 1, 2003, (the “Offer
Letter”); and
 
WHEREAS, the Company and Mr. Stewart have mutually agreed to terminate the
existing employment relationship and to release each other from any claims
arising from or related to the employment relationship.
 
NOW, THEREFORE, in consideration of the mutual promises made herein, the Company
and Mr. Stewart(collectively referred to as the “Parties”) hereby agree as
follows:
 
1.    Resignation and Termination of Employment. Mr. Stewart and the Company
acknowledge and agree that Mr. Stewart shall resign as Chief Financial Officer
of the Company (and as an officer and/or director of any other entity which is
deemed to be an affiliate of the Company) and shall terminate his employment
with the Company effective on the earlier of October 19, 2005 or such date as
determined by the Board of Directors of the Company (the “Separation Date”). For
the period from the date of this Agreement through the Separation Date, Mr.
Stewart will continue to be responsible for the financial operations of the
Company and following the commencement of employment of a new Chief Financial
Officer, will provide transition assistance as requested by the Company. The
Company shall continue to pay to Mr. Stewart his current base salary and Mr.
Stewart shall remain eligible to participate in all Company benefit plans and
programs through the Separation Date. In connection with his resignation, Mr.
Stewart agrees to execute the resignation letter attached as Exhibit A to this
letter.
 
2.    Separation Benefits. In consideration for the release of claims set forth
below and other obligations under this Agreement and in full satisfaction of the
Company’s obligations to Mr. Stewart under the terms of the Offer Letter and the
Change of Control Agreement between the Company and Mr. Stewart dated May 26,
2000, as amended on May 3, 2004, and provided this Agreement is signed by Mr.
Stewart and not revoked under Section 7 herein, the Company agrees to provide
the following separation benefits to Mr. Stewart:
 
(a)    The Company agrees to pay to Mr. Stewart his regular base salary (based
on an annual base salary of $205,000) for a six-month period beginning
immediately following the Separation Date (the “Severance Period”). The
severance payments will be subject to applicable tax withholding and will be
made on the Company's regular payroll dates during the Severance Period.
Notwithstanding the above, Mr. Stewart and the Company agree that the Severance
Period will be shortened such that it will end on the date on which Mr. Stewart
commences Full-Time Employment, as such term is defined in the Offer Letter. Mr.
Stewart agrees that he will actively seek Full-Time Employment following the
Separation Date;
 

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(b)    The Company shall make a retention bonus payment to Mr. Stewart in the
amount of $30,000 (reduced by applicable tax withholding) on the later of the
Effective Date of this Agreement and the Separation Date, provided however that
if Mr. Stewart voluntarily resigns his employment prior to the Separation Date
without the consent of the Company, he shall not be entitled to receive this
bonus payment;
 
(c)    If Mr. Stewart accurately and timely elects to continue his health
insurance benefits under COBRA, as described in Section 3(a) below, the Company
agrees to reimburse Mr. Stewart for the applicable COBRA premiums for himself
and his dependents during the Severance Period; and
 
(d)    The Company shall accelerate the vesting of the stock options granted to
Mr. Stewart as further described in Section 4(a) below such that, as of the
Separation Date, he shall be fully vested in all of his outstanding Company
stock options.
 
3.    Employee Benefits.
 
(a)    Mr. Stewart shall continue to receive the Company’s health insurance
benefits (medical and dental) at Company expense until the last day of the month
in which the Separation Date occurs, which date shall be the “qualifying event”
date under the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended (“COBRA”). If Mr. Stewart timely and accurately elects to continue his
health insurance benefits under COBRA following such date, the Company shall
reimburse Mr. Stewart for the applicable COBRA premiums for Mr. Stewart and his
dependents, if any, for the lesser of six (6) months or until he becomes
eligible for comparable group medical insurance benefits from another employer
or is otherwise ineligible for COBRA continuation coverage. Following such date,
Mr. Stewart shall have the right to continue the COBRA coverage at his own
expense. Mr. Stewart acknowledges and agrees that nothing in this Section 3(a)
shall restrict the ability of the Company from changing some or all of the terms
of such medical insurance benefits, provided that all similarly situated
participants are treated the same.
 
(b)    Except as otherwise provided above, Mr. Stewart shall not be entitled to
participate in any of the Company’s benefit plans or programs offered to
employees of the Company after the Separation Date.
 
4.    Stock Options. As of the Separation Date, all options held by Mr. Stewart
to acquire shares of the Company's common stock shall vest and be exercisable in
full. Mr. Stewart's right to exercise the vested options shall be governed by
the terms of the stock option agreements issued by the Company to Mr. Stewart,
provided however that notwithstanding the terms of such agreements, the vested
option shares shall remain exercisable by Mr. Stewart until the later of the
expiration date set forth in the applicable option agreement and December 31,
2005.

Except as set forth in this Agreement and the stock option agreements, Mr.
Stewart acknowledges that as of the Separation Date, Mr. Stewart shall have no
right, title or interest in or to any shares of the Company’s capital stock,
under any other agreement (oral or written) or plan with the Company.
 

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5.    No Other Payments Due. Mr. Stewart and the Company agree that the Company
shall pay to Mr. Stewart on or before the Separation Date, his accrued salary,
accrued vacation and other sums as are due to Mr. Stewart through such date. By
executing this Agreement, Mr. Stewart hereby acknowledges receipt of all such
payments as received and acknowledges that, in light of the payment by the
Company of all wages due to Mr. Stewart, California Labor Code Section 206.5 is
not applicable to the Parties hereto. That section provides in pertinent part as
follows:
 
No employer shall require the execution of any release of any claim or right on
account of wages due, or to become due, or made as an advance on wages to be
earned, unless payment of such wages has been made.
 
6.    Release of Claims. In consideration for the obligations of both parties
set forth in this Agreement, Mr. Stewart and the Company, on behalf of
themselves, and their respective heirs, executors, subsidiaries, officers,
directors, employees, investors, stockholders, administrators and assigns,
hereby fully and forever release each other and their respective heirs,
executors, subsidiaries, officers, directors, employees, investors,
stockholders, administrators, predecessor and successor corporations and
assigns, of and from any claim, duty, obligation or cause of action relating to
any matters of any kind, whether presently known or unknown, suspected or
unsuspected, that any of them may possess arising from any omissions, acts or
facts that have occurred up until and including the date of this Agreement
including, without limitation:
 
(a)    any and all claims relating to or arising from Mr. Stewart’s employment
relationship with the Company and the termination of that relationship;
 
(b)     any and all claims relating to, or arising from, Mr. Stewart’s right to
purchase, or actual purchase of shares of stock of the Company;
 
(c)    any and all claims for wrongful discharge of employment; breach of
con-tract, both express and implied; breach of a covenant of good faith and fair
dealing, both express and implied; negligent or intentional infliction of
emotional distress; negligent or intentional misrepresentation; negligent or
intentional interference with contract or prospective economic advantage;
negligence; and defamation;
 
(d)    any and all claims for violation of any federal, state or municipal
statute, including, but not limited to, Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1991, the Age Discrimination in Employment Act of
1967, the Americans with Disabilities Act of 1990, and the California Fair
Employment and Housing Act, and any family and medical leave acts;
 
(e)    any and all claims arising out of any other laws and regulations relating
to employment or employment discrimination; and
 
(f)    any and all claims for attorneys’ fees and costs.
 

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Excepted from the above release are Mr. Stewart's rights of indemnity under
applicable law, the Indemnification Agreement described in Section 14 below,
and/or the bylaws or certificate of incorporation of the Company or its
subsidiaries as a former officer of the Company and its subsidiaries. The
Company and Mr. Stewart agree that the release set forth in this Section 6 shall
be and remain in effect in all respects as a complete general release as to the
matters released. This release does not extend to any obligations incurred or
specified under this Agreement.
 
7.    Acknowledgment of Waiver of Claims under ADEA. Mr. Stewart acknowledges
that he is waiving and releasing any rights he may have under the Age
Discrimination in Employment Act of 1967 (“ADEA”) and that this waiver and
release is knowing and voluntary. Mr. Stewart and the Company agree that this
waiver and release does not apply to any rights or claims that may arise under
ADEA after the Effective Date of this Agreement. Mr. Stewart acknowledges that
the consideration given for this waiver and release Agreement is in addition to
anything of value to which Mr. Stewart was already entitled. Mr. Stewart further
acknowledges that he has been advised by this writing that (a) he should consult
with an attorney prior to executing this Agreement; (b) he has at least
twenty-one (21) days within which to consider this Agreement; (c) he has seven
(7) days following his execution of this Agreement to revoke the Agreement (the
“Revocation Period”). This Agreement shall not be effective until the Revocation
Period has expired.
 
8.    Civil Code Section 1542. The Parties represent that they are not aware of
any claim by either of them other than the claims that are released by this
Agreement. Mr. Stewart and the Company acknowledge that they are familiar with
the provisions of California Civil Code Section 1542, which provides as follows:
 
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.
 
Mr. Stewart and the Company, being aware of said Code section, agree to
expressly waive any rights they may have thereunder, as well as under any other
statute or common law principles of similar effect.
 
9.    Employee Covenants.
 
(a)    General. Mr. Stewart agrees that for all periods described in this
Agreement, he shall continue to conduct himself in a professional manner that is
supportive of the business of the Company.
 
(b)    Nondisclosure. Mr. Stewart represents and warrants that he has not
breached his obligations to the Company under the terms of the Confidential
Information and Invention Assignment Agreement entered into between Mr. Stewart
and the Company on April 2, 2001 (the “Confidentiality Agreement”), a copy of
which is attached hereto as Exhibit B. Mr. Stewart understands and agrees that
his obligations to the Company under the Confidentiality Agreement survive the
termination of his relationship with the Company under this Agreement.
 

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(c)    SEC Reporting/Insider Trading Compliance. Mr. Stewart agrees that he will
cooperate with the Company in providing information with respect to all reports
required to be filed by the Company with the Securities Exchange Commission as
they relate to required information with respect to Mr. Stewart. Further, Mr.
Stewart agrees that he will remain in compliance with the terms of the Company’s
insider trading program with respect to purchases and sales of the Company’s
stock.
 
10.    Non-Disparagement. Each Party agrees to refrain from any disparagement,
defamation, slander of the other, or tortious interference with the contracts
and relationships of the other.
 
11.    Breach of the Agreement. In the event that the Company determines that
Mr. Stewart has breached this Agreement, or the Confidentiality Agreement, the
Company shall provide notice to Mr. Stewart of such breach. In the event that
Mr. Stewart fails to cure such breach within 30 days of receiving notice of the
breach from the Company, in addition to any other remedies the Company may have
under this Agreement or otherwise, the Company's obligations to provide benefits
to Mr. Stewart, as described in this Agreement, including without limitation
those benefits provided in Sections 2, 3 and 4 shall immediately terminate. In
addition, Mr. Stewart acknowledges that upon his breach of this Agreement or the
Confidentiality Agreement, the Company would sustain irreparable harm from such
breach, and, therefore, Mr. Stewart agrees that notwithstanding the notice
provisions set forth above, in addition to any other remedies which the Company
may have under this Agreement or otherwise, the Company shall be entitled to
obtain equitable relief, including specific performance and injunctions,
restraining him from committing or continuing any such violation of the
Agreement or the Confidentiality Agreement.
 
12.    Authority. The Company represents and warrants that the undersigned has
the authority to act on behalf of the Company and to bind the Company and all
who may claim through it to the terms and conditions of this Agreement. Mr.
Stewart represents and warrants that he has the capacity to act on his own
behalf and on behalf of all who might claim through his to bind them to the
terms and conditions of this Agreement. Each Party warrants and represents that
there are no liens or claims of lien or assignments in law or equity or
otherwise of or against any of the claims or causes of action released herein.
 
13.    No Representations. Neither Party has relied upon any representations or
statements made by the other Party hereto which are not specifically set forth
in this Agreement.
 
14.    Indemnification. The Indemnification Agreement entered into by Mr.
Stewart and the Company, a copy of which is attached hereto as Exhibit C, shall
remain in effect following the Separation Date in accordance with the terms of
such agreement.
 

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15.    Severability. In the event that any provision hereof becomes or is
declared by a court or other tribunal of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision.
 
16.    Arbitration. The Parties shall attempt to settle all disputes arising in
connection with this Agreement through good faith consultation. In the event no
agreement can be reached on such dispute within 15 days after notification in
writing by either Party to the other concerning such dispute, the dispute shall
be settled by binding arbitration to be conducted in Alameda County before the
American Arbitration Association under its California Employment Dispute
Resolution Rules, or by a judge to be mutually agreed upon. The arbitrator will
apply California law, without reference to rules of conflicts of law or rules of
statutory arbitration, to the resolution of any dispute. The arbitration
decision shall be final, conclusive and binding on both Parties and any
arbitration award or decision may be entered in any court having jurisdiction.
The Company shall pay the costs of the arbitration proceeding, provided however
that each Party shall, unless otherwise determined by the arbitrator, bear its
or his own attorneys’ fees and expenses. The Parties agree that the prevailing
party in any arbitration shall be entitled to injunctive relief in any court of
competent jurisdiction to enforce the arbitration award. This Section 16 shall
not apply to the Confidentiality Agreement. The parties hereby waive any rights
they may have to trial by jury in regard to arbitrable claims.
 
17.    Entire Agreement. This Agreement, with the exhibits attached hereto,
represents the entire agreement and understanding between the Company and Mr.
Stewart concerning Mr. Stewart’s separation from the Company, and supersede and
replace any and all prior agreements and understandings concerning Mr. Stewart’s
relationship with the Company and his compensation by the Company.
 
18.    No Oral Modification. This Agreement may only be amended in writing
signed by Mr. Stewart and the Company.
 
19.    Governing Law. This Agreement shall be governed by the laws of the State
of California, without regard to its conflicts of law provisions.
 
20.    Effective Date. This Agreement is effective upon the expiration of the
Revocation Period described in Section 7 and such date is referred to herein as
the “Effective Date.”
 
21.    Counterparts. This Agreement may be executed in counterparts, and each
coun-terpart shall have the same force and effect as an original and shall
constitute an effective, binding agreement on the part of each of the
undersigned.
 
22.    Assignment. This Agreement may not be assigned by Mr. Stewart or the
Company without the prior written consent of the other party. Notwithstanding
the foregoing, this Agreement may be assigned by the Company to a corporation
controlling, controlled by or under common control with the Company without the
consent of Mr. Stewart.
 
23.    Continuing Representations. Mr. Stewart expressly acknowledges and agrees
that, if requested to do so by the Company, he shall sign a Continuing
Representations Certificate, in the form provided by the Company, on the
Separation Date, reaffirming each of the waivers, releases, warranties and
representations contained in this Agreement as of such date and that Mr.
Stewart’s rights continue to be as defined by the terms of this Agreement as of
such date.
 

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24.    Voluntary Execution of Agreement. This Agreement is executed voluntarily
and without any duress or undue influence on the part or behalf of the Parties
hereto, with the full intent of releasing all claims. The Parties acknowledge
that:
 
(a)    they have read this Agreement;
 
(b)    they have been represented in the preparation, negotiation, and execution
of this Agreement by legal counsel of their own choice or that they have
voluntarily declined to seek such counsel;
 
(c)    they understand the terms and consequences of this Agreement and of the
releases it contains; and
 
(d)    they are fully aware of the legal and binding effect of this Agreement.
 
IN WITNESS WHEREOF, the Parties have executed this Separation Agreement and
Mutual Release on the respective dates set forth below.
 
RITA MEDICAL SYSTEMS, INC.
Dated as of May 19, 2005 
By:  /s/ Joseph DeVivo

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Title:  President and CEO

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DONALD J. STEWART, an individual
 
Dated as of May 19,
2005                                                                                       
/s/ Donald Stewart

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EXHIBIT A
 
___________________________, 200__

RITA Medical Systems, Inc.
46421 Landing Parkway
Fremont, CA 94538

Horizon Medical Products, Inc.
One Horizon Way
Manchester, GA 31816

RE: Resignation

To the Board of Directors of RITA Medical Systems, Inc. and Horizon Medical
Products, Inc.:

I hereby resign as Chief Financial Officer and Vice President, Finance and
Administration of RITA Medical Systems, Inc. ("RITA"), Chief Financial Officer
of Horizon Medical Products, Inc. ("Horizon"), and as an officer or director of
any subsidiary of RITA or Horizon, effective as of ___________________________,
200__.

Sincerely,
 
 

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Donald Stewart

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EXHIBIT B

CONFIDENTIAL INFORMATION AND
INVENTION ASSIGNMENT AGREEMENT
 
As a condition of my becoming employed (or my employment being continued) by or
retained as a consultant (or my consulting relationship being continued) by
«Name», a Delaware corporation (“RITA”) or any of its current or future
subsidiaries, affiliates, successors or assigns (collectively, the “Company”),
and in consideration of my employment or consulting relationship with the
Company and my receipt of the compensation now and hereafter paid to me by the
Company, I agree to the following:
 
1.    Employment or Consulting Relationship. I understand and acknowledge that
this Agreement does not alter, amend or expand upon any rights I may have to
continue in the employ of, or in a consulting relationship with, or the duration
of my employment or consulting relationship with, the Company under any existing
agreements between the Company and me or under applicable law. Any employment or
consulting relationship between the Company and me, whether commenced prior to
or upon the date of this Agreement, shall be referred to herein as the
“Relationship.”
 
2.    At-Will Relationship. I understand and acknowledge that my Relationship
with the Company is and shall continue to be at-will, as defined under
applicable law, meaning that either I or the Company may terminate the
Relationship at any time for any reason or no reason, without further obligation
or liability.
 
3.    Confidential Information.
 
(a)    Company Information. I agree at all times during the term of my
Relationship with the Company and thereafter, to hold in strictest confidence,
and not to use, except for the benefit of the Company to the extent necessary to
perform my obligations to the Company under the Relationship, or to disclose to
any person, firm, corporation or other entity without written authorization of
the Board of Directors of the Company, any Confidential Information of the
Company which I obtain or create. I further agree not to make copies of such
Confidential Information except as authorized by the Company. I understand that
“Confidential Information” means any Company proprietary information, technical
data, trade secrets or know-how, including, but not limited to, research,
product plans, products, services, suppliers, customer lists and customers
(including, but not limited to, customers of the Company on whom I called or
with whom I became acquainted during the Relationship), prices and costs,
markets, software, developments, inventions, laboratory notebooks, processes,
formulas, technology, designs, drawings, engineering, hardware configuration
information, marketing, licenses, finances, budgets or other business
information disclosed to me by the Company either directly or indirectly in
writing, orally or by drawings or observation of parts or equipment or created
by me during the period of the Relationship, whether or not during working
hours. I understand that Confidential Information includes, but is not limited
to, information pertaining to any aspect of the Company’s business which is
either information not known by actual or potential competitors of the Company
or other third parties not under confidentiality obligations to the Company, or
is otherwise proprietary information of the Company or its customers or
suppliers, whether of a technical nature or otherwise. I further understand that
Confidential Information does not include any of the foregoing items which has
become publicly and widely known and made generally available through no
wrongful act of mine or of others who were under confidentiality obligations as
to the item or items involved.
 

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(b)    Prior Obligations. I represent that my performance of all terms of this
Agreement as an employee or consultant of the Company has not breached and will
not breach any agreement to keep in confidence proprietary information,
knowledge or data acquired by me prior or subsequent to the commencement of my
Relationship with the Company, and I will not disclose to the Company or use any
inventions, confidential or non-public proprietary information or material
belonging to any previous client, employer or any other party. I will not induce
the Company to use any inventions, confidential or non-public proprietary
information, or material belonging to any previous client, employer or any other
party.  
 
(c)    Third Party Information. I recognize that the Company has received and in
the future will receive confidential or proprietary information from third
parties subject to a duty on the Company’s part to maintain the confidentiality
of such information and to use it only for certain limited purposes. I agree to
hold all such confidential or proprietary information in the strictest
confidence and not to disclose it to any person, firm or corporation or to use
it except as necessary in carrying out my work for the Company consistent with
the Company’s agreement with such third party.
 
4.    Inventions.
 
(a)    Inventions Retained and Licensed. I have attached hereto, as Exhibit A, a
list describing with particularity all inventions, original works of authorship,
developments, improvements, and trade secrets which were made by me prior to the
commencement of the Relationship (collectively referred to as “Prior
Inventions”), which belong solely to me or belong to me jointly with another,
which relate in any way to any of the Company’s proposed businesses, products or
research and development, and which are not assigned to the Company hereunder;
or, if no such list is attached, I represent that there are no such Prior
Inventions. If, in the course of my Relationship with the Company, I incorporate
into a Company product, process or machine a Prior Invention owned by me or in
which I have an interest, the Company is hereby granted and shall have a
non-exclusive, royalty-free, irrevocable, perpetual, worldwide license (with the
right to sublicense) to make, have made, copy, modify, make derivative works of,
use, sell and otherwise distribute such Prior Invention as part of or in
connection with such product, process or machine.
 

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(b)    Assignment of Inventions. I agree that I will promptly make full written
disclosure to the Company, will hold in trust for the sole right and benefit of
the Company, and hereby assign to the Company, or its designee, all my right,
title and interest throughout the world in and to any and all inventions,
original works of authorship, developments, concepts, know-how, improvements or
trade secrets, whether or not patentable or registrable under copyright or
similar laws, which I may solely or jointly conceive or develop or reduce to
practice, or cause to be conceived or developed or reduced to practice, during
the period of my Relationship with the Company (collectively referred to as
“Inventions”), except as provided in Section 4(e) below. I further acknowledge
that all Inventions which are made by me (solely or jointly with others) within
the scope of and during the period of my Relationship with the Company are
“works made for hire” (to the greatest extent permitted by applicable law) and
are compensated by my salary (if I am an employee) or by such amounts paid to me
under any applicable consulting agreement or consulting arrangements (if I am a
consultant), unless regulated otherwise by the mandatory law of the state of
California.
 
(c)    Provision of Records.  I agree to provide to the Company upon its
reasonable request any and all notes, records or other written or recorded
information that I have created and are in my possession or under my control
regarding possible Inventions made by me (solely or jointly with others) during
the term of my Relationship with the Company.
 
(d)    Patent and Copyright Rights.  I agree to assist the Company, or its
designee, at the Company's expense, in every proper way to secure the Company’s
rights in the Inventions and any copyrights, patents, trademarks, mask work
rights, moral rights, or other intellectual property rights relating thereto in
any and all countries, including the disclosure to the Company of all pertinent
information and data with respect thereto, the execution of all applications,
specifications, oaths, assignments, recordations, and all other instruments
which the Company shall deem necessary in order to apply for, obtain, maintain
and transfer such rights, or if not transferable, waive such rights, and in
order to assign and convey to the Company, and any successors, assigns and
nominees the sole and exclusive rights, title and interest in and to such
Inventions, and any copyrights, patents, mask work rights or other intellectual
property rights relating thereto. I further agree that my obligation to execute
or cause to be executed, when it is in my power to do so, any such instrument or
papers shall continue after the termination of this Agreement until the
expiration of the last such intellectual property right to expire in any country
of the world. If the Company is unable because of my mental or physical
incapacity or unavailability or for any other reason to secure my signature to
apply for or to pursue any application for any United States or foreign patents,
copyright, mask works or other registrations covering Inventions or original
works of authorship assigned to the Company, then I hereby irrevocably designate
and appoint the Company and its duly authorized officers and agents as my agent
and attorney in fact, to act for and in my behalf and stead to execute and file
any such applications and to do all other lawfully permitted acts to further the
application for, prosecution, issuance, maintenance or transfer of letters
patent, copyright or other registrations thereon with the same legal force and
effect as if originally executed by me. I hereby waive and irrevocably quitclaim
to the Company any and all claims, of any nature whatsoever, which I now or
hereafter have for infringement of any and all proprietary rights assigned to
the Company.
 

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(e)    Exception to Assignments. I understand that the provisions of this
Agreement requiring assignment of Inventions to the Company do not apply to any
invention which qualifies fully under the provisions of California Labor Code
Section 2870 (attached hereto as Exhibit B). I will advise the Company promptly
in writing of any inventions that I believe meet such provisions and are not
otherwise disclosed on Exhibit A.
 
5.    Returning Company Documents.   I agree that, at the time of termination of
my Relationship with the Company or upon the Company's request, I will deliver
to the Company all originals and copies of all documents, other written
information and information recorded in any tangible form in my possession that
contain any Confidential Information. If I am an employee of the Company, in the
event of the termination of the Relationship, I agree to sign and deliver the
“Termination Certification” attached hereto as Exhibit C;
 
6.    Solicitation of Employees, Consultants and Other Parties. I agree that
during the term of my Relationship with the Company, and for a period of
twenty-four (24) months immediately following the termination of my Relationship
with the Company for any reason, whether with or without cause, I shall not
either directly or indirectly solicit, induce, recruit or encourage any of the
Company’s employees or consultants to terminate their relationship with the
Company, or attempt to solicit, induce, recruit, encourage or take away
employees or consultants of the Company, either for myself or for any other
person or entity. Further, during my Relationship with the Company and at any
time following termination of my Relationship with the Company for any reason,
with or without cause, I shall not use any Confidential Information of the
Company to attempt to negatively influence any of the Company’s clients or
customers from purchasing Company products or services or to solicit or
influence or attempt to influence any client, customer or other person either
directly or indirectly, to direct his or its purchase of products and/or
services to any person, firm, corporation, institution or other entity in
competition with the business of the Company.
 

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7.    Representations and Covenants.
 
(a)    Facilitation of Agreement. I agree to execute promptly any proper oath or
verify any proper document required to carry out the terms of this Agreement
upon the Company’s written request to do so.
 
(b)    Conflicts. I represent that my performance of all the terms of this
Agreement does not and will not breach any agreement I have entered into, or
will enter into with any third party, including without limitation any agreement
to keep in confidence proprietary information acquired by me in confidence or in
trust prior to commencement of my Relationship with the Company. I agree not to
enter into any written or oral agreement that conflicts with the provisions of
this Agreement.
 
(c)    Voluntary Execution. I certify and acknowledge that I have carefully read
all of the provisions of this Agreement and that I understand and will fully and
faithfully comply with such provisions.
 
8.    General Provisions.
 
(a)    Governing Law. The validity, interpretation, construction and performance
of this Agreement shall be governed by the laws of the State of California,
without giving effect to the principles of conflict of laws.
 
(b)    Entire Agreement. This Agreement sets forth the entire agreement and
understanding between the Company and me relating to the subject matter herein
and merges all prior discussions between us. No modification or amendment to
this Agreement, nor any waiver of any rights under this Agreement, will be
effective unless in writing signed by both parties. Any subsequent change or
changes in my duties, obligations, rights or compensation will not affect the
validity or scope of this Agreement.
 
(c)    Severability. If one or more of the provisions in this Agreement are
deemed void by law, then the remaining provisions will continue in full force
and effect.
 

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(d)    Successors and Assigns. This Agreement will be binding upon my heirs,
executors, administrators and other legal representatives, and my successors and
assigns, and will be for the benefit of the Company, its successors, and its
assigns.
 
(e)    Survival. The provisions of this Agreement shall survive the termination
of the Relationship and the assignment of this Agreement by the Company to any
successor in interest or other assignee.
 
(f)    ADVICE OF COUNSEL. I ACKNOWLEDGE THAT, IN EXECUTING THIS AGREEMENT, I
HAVE HAD THE OPPORTUNITY TO SEEK THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND I
HAVE READ AND UNDERSTOOD ALL OF THE TERMS AND PROVISIONS OF THIS AGREEMENT. THIS
AGREEMENT SHALL NOT BE CONSTRUED AGAINST ANY PARTY BY REASON OF THE DRAFTING OR
PREPARATION HEREOF.
 
 

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[Signature Page Follows]

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The parties have executed this Agreement on the respective dates set forth
below:
 

COMPANY: EMPLOYEE:     RITA MEDICAL SYSTEMS, INC. DONALD J. STEWART, an
Individual:     /s/ Barry Cheskin /s/ Donald J. Stewart

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Signature

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Signature     By: Barry Cheskin By: Donald J. Stewart     Title: President and
CEO      
Date: April 2, 2001

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Date: April 2, 2001

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Address:   967 Shoreline Blvd. Address:   48660 Plomosa Road
Mountain View, CA 94043
Fremont, CA  94539

 

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EXHIBIT A
 
LIST OF PRIOR INVENTIONS
AND ORIGINAL WORKS OF AUTHORSHIP
EXCLUDED UNDER SECTION 5

 
        Title        
 
 
   Date   
 
Identifying Number
or Brief Description
                   

x No inventions or improvements

 
___ Additional Sheets Attached
 
Signature of Employee/Consultant: /s/ Donald Stewart
 
Print Name of Employee/Consultant: Donald J. Stewart
 
Date: April 2, 2001
 

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EXHIBIT B
 
Section 2870 of the California Labor Code is as follows:

(a)    Any provision in an employment agreement which provides that an employee
shall assign, or offer to assign, any of his or her rights in an invention to
his or her employer shall not apply to an invention that the employee developed
entirely on his or her own time without using the employer’s equipment,
supplies, facilities, or trade secret information except for those inventions
that either:
 
(1)    Relate at the time of conception or reduction to practice of the
invention to the employer’s business, or actual or demonstrably anticipated
research or development of the employer; or
 
(2)    Result from any work performed by the employee for the employer.
 
(b)    To the extent a provision in an employment agreement purports to require
an employee to assign an invention otherwise excluded from being required to be
assigned under subdivision (a), the provision is against the public policy of
this state and is unenforceable.
 

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EXHIBIT C
 
TERMINATION CERTIFICATION
 
This is to certify that I do not have in my possession, nor have I failed to
return, any devices, records, data, notes, reports, proposals, lists,
correspondence, specifications, drawings, blueprints, sketches, laboratory
notebooks, flow charts, materials, equipment, other documents or property, or
copies or reproductions of any aforementioned items belonging to «Name», its
subsidiaries, affiliates, successors or assigns (together the “Company”).
 
I further certify that I have complied with all the terms of the Company’s
Confidential Information and Invention Assignment Agreement signed by me,
including the reporting of any inventions and original works of authorship (as
defined therein), conceived or made by me (solely or jointly with others)
covered by that agreement.
 
I further agree that, in compliance with the Confidential Information and
Invention Assignment Agreement, I will preserve as confidential all trade
secrets, confidential knowledge, data or other proprietary information relating
to products, processes, know-how, designs, formulas, developmental or
experimental work, computer programs, data bases, other original works of
authorship, customer lists, business plans, financial information or other
subject matter pertaining to any business of the Company or any of its
employees, clients, consultants or licensees.
 
I further agree that for twenty-four (24) months from the date of this
Certificate, I shall not either directly or indirectly solicit, induce, recruit
or encourage any of the Company’s employees or consultants to terminate their
relationship with the Company, or attempt to solicit, induce, recruit, encourage
or take away employees or consultants of the Company, either for myself or for
any other person or entity. Further, I shall not at any time use any
Confidential Information of the Company to negatively influence any of the
Company’s clients or customers from purchasing Company products or services or
to solicit or influence or attempt to influence any client, customer or other
person either directly or indirectly, to direct his or its purchase of products
and/or services to any person, firm, corporation, institution or other entity in
competition with the business of the Company.
 
Date:_____________________________

 

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(Employee’s Signature)
 
 

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(Type/Print Employee’s Name)

 
 

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EXHIBIT C
 
INDEMNIFICATION AGREEMENT
 

This Indemnification Agreement (the “Agreement”) is made as of April 16, 2001 by
and between RITA Medical Systems, Inc., a Delaware corporation (the “Company”),
and Donald Stewart (the “Indemnitee”).
 
RECITALS
 
The Company and Indemnitee recognize the increasing difficulty in obtaining
liability insurance for directors, officers and key employees, the significant
increases in the cost of such insurance and the general reductions in the
coverage of such insurance. The Company and Indemnitee further recognize the
substantial increase in corporate litigation in general, subjecting directors,
officers and key employees to expensive litigation risks at the same time as the
availability and coverage of liability insurance has been severely limited.
Indemnitee does not regard the current protection available as adequate under
the present circumstances, and Indemnitee and agents of the Company may not be
willing to continue to serve as agents of the Company without additional
protection. The Company desires to attract and retain the services of highly
qualified individuals, such as Indemnitee, and to indemnify its directors,
officers and key employees so as to provide them with the maximum protection
permitted by law.
 
AGREEMENT
 
In consideration of the mutual promises made in this Agreement, and for other
good and valuable consideration, receipt of which is hereby acknowledged, the
Company and Indemnitee hereby agree as follows:
 
1.    Indemnification.
 
(a)    Third Party Proceedings. The Company shall indemnify Indemnitee if
Indemnitee is or was a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the Company) by reason of the fact that Indemnitee is or was a
director, officer, employee or agent of the Company, or any subsidiary of the
Company, by reason of any action or inaction on the part of Indemnitee while an
officer or director or by reason of the fact that Indemnitee is or was serving
at the request of the Company as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys’ fees), judgments, fines and amounts paid
in settlement (if such settlement is approved in advance by the Company, which
approval shall not be unreasonably withheld) actually and reasonably incurred by
Indemnitee in connection with such action, suit or proceeding if Indemnitee
acted in good faith and in a manner Indemnitee reasonably believed to be in or
not opposed to the best interests of the Company, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe Indemnitee’s
conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that Indemnitee did
not act in good faith and in a manner which Indemnitee reasonably believed to be
in or not opposed to the best interests of the Company, or, with respect to any
criminal action or proceeding, that Indemnitee had reasonable cause to believe
that Indemnitee’s conduct was unlawful.
 

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(b)    Proceedings By or in the Right of the Company. The Company shall
indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made
a party to any threatened, pending or completed action or proceeding by or in
the right of the Company or any subsidiary of the Company to procure a judgment
in its favor by reason of the fact that Indemnitee is or was a director,
officer, employee or agent of the Company, or any subsidiary of the Company, by
reason of any action or inaction on the part of Indemnitee while an officer or
director or by reason of the fact that Indemnitee is or was serving at the
request of the Company as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys’ fees) and, to the fullest extent permitted by
law, amounts paid in settlement (if such settlement is approved in advance by
the Company, which approval shall not be unreasonably withheld), in each case to
the extent actually and reasonably incurred by Indemnitee in connection with the
defense or settlement of such action or suit if Indemnitee acted in good faith
and in a manner Indemnitee reasonably believed to be in or not opposed to the
best interests of the Company and its stockholders, except that no
indemnification shall be made in respect of any claim, issue or matter as to
which Indemnitee shall have been finally adjudicated by court order or judgment
to be liable to the Company in the performance of Indemnitee’s duty to the
Company and its stockholders unless and only to the extent that the court in
which such action or proceeding is or was pending shall determine upon
application that, in view of all the circumstances of the case, Indemnitee is
fairly and reasonably entitled to indemnity for such expenses which such court
shall deem proper.
 
(c)    Mandatory Payment of Expenses. To the extent that Indemnitee has been
successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in Section 1(a) or Section 1(b) or the defense of any
claim, issue or matter therein, Indemnitee shall be indemnified against expenses
(including attorneys’ fees) actually and reasonably incurred by Indemnitee in
connection therewith.
 
2.    No Employment Rights. Nothing contained in this Agreement is intended to
create in Indemnitee any right to continued employment.
 
3.    Expenses; Indemnification Procedure.
 
(a)    Advancement of Expenses. The Company shall advance all expenses incurred
by Indemnitee in connection with the investigation, defense, settlement or
appeal of any civil or criminal action, suit or proceeding referred to in
Section l(a) or Section 1(b) hereof (including amounts actually paid in
settlement of any such action, suit or proceeding). Indemni-tee hereby
undertakes to repay such amounts advanced only if, and to the extent that, it
shall ultimately be determined that Indemnitee is not entitled to be indemnified
by the Company as authorized hereby.
 
(b)    Notice/Cooperation by Indemnitee. Indemnitee shall, as a condition
precedent to his or her right to be indemnified under this Agreement, give the
Company notice in writing as soon as practicable of any claim made against
Indemnitee for which indemnification will or could be sought under this
Agreement. Notice to the Company shall be directed to the Chief Executive
Officer of the Company and shall be given in accordance with the provisions of
Section 12(d) below. In addition, Indemnitee shall give the Company such
information and cooperation as it may reasonably require and as shall be within
Indemnitee’s power.
 

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(c)    Procedure. Any indemnification and advances provided for in Section 1 and
this Section 3 shall be made no later than twenty (20) days after receipt of the
written request of Indemnitee. If a claim under this Agreement, under any
statute, or under any provision of the Company’s Certificate of Incorporation or
Bylaws providing for indemnification, is not paid in full by the Company within
twenty (20) days after a written request for payment thereof has first been
received by the Company, Indemnitee may, but need not, at any time thereafter
bring an action against the Company to recover the unpaid amount of the claim
and, subject to Section 11 of this Agreement, Indemnitee shall also be entitled
to be paid for the expenses (including attorneys’ fees) of bringing such action.
It shall be a defense to any such action (other than an action brought to
enforce a claim for expenses incurred in connection with any action, suit or
proceeding in advance of its final disposition) that Indemnitee has not met the
standards of conduct which make it permissible under applicable law for the
Company to indemnify Indemnitee for the amount claimed, but the burden of
proving such defense shall be on the Company and Indemnitee shall be entitled to
receive interim payments of expenses pursuant to Section 3(a) unless and until
such defense may be finally adjudicated by court order or judgment from which no
further right of appeal exists. It is the parties’ intention that if the Company
contests Indemnitee’s right to indemnification, the question of Indemnitee’s
right to indemnification shall be for the court to decide, and neither the
failure of the Company (including its Board of Directors, any committee or
subgroup of the Board of Directors, independent legal counsel, or its
stockholders) to have made a determination that indemnification of Indemnitee is
proper in the circumstances because Indemnitee has met the applicable standard
of conduct required by applicable law, nor an actual determination by the
Company (including its Board of Directors, any committee or subgroup of the
Board of Directors, independent legal counsel, or its stockholders) that
Indemnitee has not met such applicable standard of conduct, shall create a
presumption that Indemnitee has or has not met the applicable standard of
conduct.
 
(d)    Notice to Insurers. If, at the time of the receipt of a notice of a claim
pursuant to Section 3(b) hereof, the Company has director and officer liability
insurance in effect, the Company shall give prompt notice of the commencement of
such proceeding to the insurers in accordance with the procedures set forth in
the respective policies. The Company shall thereafter take all necessary or
desirable action to cause such insurers to pay, on behalf of the Indemnitee, all
amounts payable as a result of such proceeding in accordance with the terms of
such policies.
 
(e)    Selection of Counsel. In the event the Company shall be obligated under
Section 3(a) hereof to pay the expenses of any proceeding against Indemnitee,
the Company, if appropriate, shall be entitled to assume the defense of such
proceeding, with counsel approved by Indemnitee, upon the delivery to Indemnitee
of written notice of its election so to do. After delivery of such notice,
approval of such counsel by Indemnitee and the retention of such counsel by the
Company, the Company will not be liable to Indemnitee under this Agreement for
any fees of counsel subsequently incurred by Indemnitee with respect to the same
proceeding, pro-vided that (i) Indemnitee shall have the right to employ counsel
in any such proceeding at Indemnitee’s expense; and (ii) if (A) the employment
of counsel by Indemnitee has been previously authorized by the Company,
(B) Indemnitee shall have reasonably concluded that there may be a conflict of
interest between the Company and Indemnitee in the conduct of any such defense
or (C) the Company shall not, in fact, have employed counsel to assume the
defense of such proceeding, then the fees and expenses of Indemnitee’s counsel
shall be at the expense of the Company.
 

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4.    Additional Indemnification Rights; Nonexclusivity.
 
(a)    Scope. Notwithstanding any other provision of this Agreement, the Company
hereby agrees to indemnify the Indemnitee to the fullest extent permitted by
law, notwithstanding that such indemnification is not specifically authorized by
the other provisions of this Agreement, the Company’s Certificate of
Incorporation, the Company’s Bylaws or by statute. In the event of any change,
after the date of this Agreement, in any applicable law, statute, or rule which
expands the right of a Delaware corporation to indemnify a member of its board
of directors or an officer, such changes shall be deemed to be within the
purview of Indemnitee’s rights and the Company’s obligations under this
Agreement. In the event of any change in any applicable law, statute or rule
which narrows the right of a Delaware corporation to indemnify a member of its
board of directors or an officer, such changes, to the extent not otherwise
required by such law, statute or rule to be applied to this Agreement shall have
no effect on this Agreement or the parties’ rights and obligations hereunder.
 
(b)    Nonexclusivity. The indemnification provided by this Agreement shall not
be deemed exclusive of any rights to which Indemnitee may be entitled under the
Company’s Certificate of Incorporation, its Bylaws, any agreement, any vote of
stockholders or disinterested members of the Company’s Board of Directors, the
General Corporation Law of the State of Delaware, or otherwise, both as to
action in Indemnitee’s official capacity and as to action in another capacity
while holding such office. The indemnification provided under this Agreement
shall continue as to Indemnitee for any action taken or not taken while serving
in an indemnified capacity even though he or she may have ceased to serve in any
such capacity at the time of any action, suit or other covered proceeding.
 
5.    Partial Indemnification. If Indemnitee is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of the
expenses, judgments, fines or penalties actually or reasonably incurred in the
investigation, defense, appeal or settlement of any civil or criminal action,
suit or proceeding, but not, however, for the total amount thereof, the Company
shall nevertheless indemnify Indemnitee for the portion of such expenses,
judgments, fines or penalties to which Indemnitee is entitled.
 
6.    Mutual Acknowledgment. Both the Company and Indemnitee acknowledge that in
certain instances, Federal law or public policy may override applicable state
law and prohibit the Company from indemnifying its directors and officers under
this Agreement or otherwise. For example, the Company and Indemnitee acknowledge
that the Securities and Exchange Commission (the “SEC”) has taken the position
that indemnification is not permissible for liabilities arising under certain
federal securities laws, and federal legislation prohibits indemnification for
certain ERISA violations. Indemnitee understands and acknowledges that the
Company has undertaken or may be required in the future to undertake with the
SEC to submit the question of indemnification to a court in certain
circumstances for a determination of the Company’s right under public policy to
indemnify Indemnitee.
 

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7.    Officer and Director Liability Insurance. The Company shall, from time to
time, make the good faith determination whether or not it is practicable for the
Company to obtain and maintain a policy or policies of insurance with reputable
insurance companies providing the officers and directors of the Company with
coverage for losses from wrongful acts, or to ensure the Company’s performance
of its indemnification obligations under this Agreement. Among other
considerations, the Company will weigh the costs of obtaining such insurance
coverage against the protection afforded by such coverage. In all policies of
director and officer liability insurance, Indemnitee shall be named as an
insured in such a manner as to provide Indemnitee the same rights and benefits
as are accorded to the most favorably insured of the Company’s directors, if
Indemnitee is a director; or of the Company’s officers, if Indemnitee is not a
director of the Company but is an officer; or of the Company’s key employees, if
Indemnitee is not an officer or director but is a key employee. Notwithstanding
the foregoing, the Company shall have no obligation to obtain or maintain such
insurance if the Company determines in good faith that such insurance is not
reasonably available, if the premium costs for such insurance are
disproportionate to the amount of coverage provided, if the coverage provided by
such insurance is limited by exclusions so as to provide an insufficient
benefit, or if Indemnitee is covered by similar insurance maintained by a parent
or subsidiary of the Company.
 
8.    Severability. Nothing in this Agreement is intended to require or shall be
construed as requiring the Company to do or fail to do any act in violation of
applicable law. The Company’s inability, pursuant to court order, to perform its
obligations under this Agreement shall not constitute a breach of this
Agreement. The provisions of this Agreement shall be severable as provided in
this Section 8. If this Agreement or any portion hereof shall be invalidated on
any ground by any court of competent jurisdiction, then the Company shall
nevertheless indemnify Indemnitee to the full extent permitted by any applicable
portion of this Agreement that shall not have been invalidated, and the balance
of this Agreement not so invalidated shall be enforceable in accordance with its
terms.
 
9.    Exceptions. Any other provision herein to the contrary notwithstanding,
the Company shall not be obligated pursuant to the terms of this Agreement:
 
(a)    Claims Initiated by Indemnitee. To indemnify or advance expenses to
Indemnitee with respect to proceedings or claims initiated or brought
voluntarily by Indemnitee and not by way of defense, except with respect to
proceedings brought to establish or enforce a right to indemnification under
this Agreement or any other statute or law or otherwise as required under
Section 145 of the Delaware General Corporation Law, but such indemnification or
advancement of expenses may be provided by the Company in specific cases if the
Board of Directors finds it to be appropriate;
 
(b)    Lack of Good Faith. To indemnify Indemnitee for any expenses incurred by
Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or
interpret this Agreement, if a court of competent jurisdiction determines that
each of the material assertions made by Indemnitee in such proceeding was not
made in good faith or was frivolous;
 

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(c)    Insured Claims. To indemnify Indemnitee for expenses or liabilities of
any type whatsoever (including, but not limited to, judgments, fines, ERISA
excise taxes or penalties, and amounts paid in settlement) to the extent such
expenses or liabilities have been paid directly to Indemnitee by an insurance
carrier under a policy of officers’ and directors’ liability insurance
maintained by the Company; or
 
(d)    Claims under Section 16(b). To indemnify Indemnitee for expenses or the
payment of profits arising from the purchase and sale by Indemnitee of
securities in violation of Section 16(b) of the Securities Exchange Act of 1934,
as amended, or any similar successor statute.
 
10.    Construction of Certain Phrases.
 
(a)    For purposes of this Agreement, references to the “Company” shall
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have had power and
authority to indemnify its directors, officers, and employees or agents, so that
if Indemnitee is or was a director, officer, employee or agent of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, Indemnitee shall stand in
the same position under the provisions of this Agreement with respect to the
resulting or surviving corporation as Indemnitee would have with respect to such
constituent corporation if its separate existence had continued.
 
(b)    For purposes of this Agreement, references to “other enterprises” shall
include employee benefit plans; references to “fines” shall include any excise
taxes assessed on Indemnitee with respect to an employee benefit plan; and
references to “serving at the request of the Company” shall include any service
as a director, officer, employee or agent of the Company which imposes duties
on, or involves services by, such director, officer, employee or agent with
respect to an employee benefit plan, its participants, or beneficiaries; and if
Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to
be in the interest of the participants and beneficiaries of an employee benefit
plan, Indemnitee shall be deemed to have acted in a manner “not opposed to the
best interests of the Company” as referred to in this Agreement.
 
11.    Attorneys’ Fees. In the event that any action is instituted by Indemnitee
under this Agreement to enforce or inter-pret any of the terms hereof,
Indemnitee shall be entitled to be paid all court costs and expenses, including
reasonable attorneys’ fees, incurred by Indemnitee with respect to such action,
unless as a part of such action, the court of competent jurisdiction determines
that each of the material assertions made by Indemnitee as a basis for such
action were not made in good faith or were frivolous. In the event of an action
instituted by or in the name of the Company under this Agreement or to enforce
or interpret any of the terms of this Agreement, Indemnitee shall be entitled to
be paid all court costs and expenses, including attorneys’ fees, incurred by
Indemnitee in defense of such action (including with respect to Indemnitee’s
counterclaims and cross-claims made in such action), unless as a part of such
action the court determines that each of Indemnitee’s material defenses to such
action were made in bad faith or were frivolous.
 

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12.    Miscellaneous.
 
(a)    Governing Law. This Agreement and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be governed,
construed and interpreted in accordance with the laws of the State of Delaware,
without giving effect to principles of conflict of law.
 
(b)    Entire Agreement; Enforcement of Rights. This Agreement sets forth the
entire agreement and understanding of the parties relating to the subject matter
herein and merges all prior discussions between them. No modification of or
amendment to this Agreement, nor any waiver of any rights under this Agreement,
shall be effective unless in writing signed by the parties to this Agreement.
The failure by either party to enforce any rights under this Agreement shall not
be construed as a waiver of any rights of such party.
 
(c)    Construction. This Agreement is the result of negotiations between and
has been reviewed by each of the parties hereto and their respective counsel, if
any; accordingly, this Agreement shall be deemed to be the product of all of the
parties hereto, and no ambiguity shall be construed in favor of or against any
one of the parties hereto.
 
(d)    Notices. Any notice, demand or request required or permitted to be given
under this Agreement shall be in writing and shall be deemed sufficient when
delivered personally or sent by telegram or fax, or forty-eight (48) hours after
being deposited in the U.S. mail, as certified or registered mail, with postage
prepaid, and addressed to the party to be notified at such party’s address as
set forth below or as subsequently modified by written notice.
 
(e)    Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original and all of which together shall
constitute one instrument.
 
(f)    Successors and Assigns. This Agreement shall be binding upon the Company
and its successors and assigns, and inure to the benefit of Indemnitee and
Indemnitee’s heirs, legal representatives and assigns.
 
(g)    Subrogation. In the event of payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee, who shall execute all documents required and shall do
all acts that may be necessary to secure such rights and to enable the Company
to effectively bring suit to enforce such rights.

 
[Signature Page Follows]
 

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The parties hereto have executed this Agreement as of the day and year set forth
on the first page of this Agreement.
 
RITA Medical Systems, Inc.
 
By:   /s/ Barry Cheskin

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Title: President and CEO

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Address:   967 Shoreline Blvd.
Mountain View, CA 94043

AGREED TO AND ACCEPTED:

NAME
 
/s/ Donald Stewart

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(Signature)

Address:   48660 Plomosa Road
Fremont, CA  94539

 

 

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