Exhibit 10.23

 

TELIK, INC.

 

CHANGE OF CONTROL SEVERANCE BENEFIT PLAN

 

Section 1.    INTRODUCTION.

 

The Telik, Inc. Change of Control Severance Benefit Plan (the “Plan”) was
established effective February 21, 2003. The purpose of the Plan is to provide
for the payment of severance benefits to certain eligible employees of Telik,
Inc. (the “Company”) whose employment with the Company is terminated under
specified circumstances following a Change of Control. Except as provided in
clause (ii) of Section 4(b) below, this Plan shall supersede any severance
benefit plan, policy or practice previously maintained by the Company. This Plan
document is also the Summary Plan Description for the Plan.

 

Section 2.    DEFINITIONS.

 

For purposes of the Plan, the following terms are defined as follows:

 

(a)    “Annual Target Bonus” means the Eligible Employee’s target cash bonus.

 

(b)    “Base Salary” means the Eligible Employee’s annual base salary.

 

(c)    “Board” means the Board of Directors of the Company.

 

(d)    “Change of Control” means the occurrence in a single transaction or in a
series of related transactions of any one or more of the following events:

 

(i)    any person (within the meaning of Section 13(d) or 14(d) of the
Securities Exchange Act of 1934, as amended) becomes the owner, directly or
indirectly, of securities of the Company representing more than 50% of the
combined voting power of the Company’s then outstanding securities other than by
virtue of a merger, consolidation or similar transaction.

 

(ii)    there is consummated a merger, consolidation or similar transaction
involving (directly or indirectly) the Company and, immediately after the
consummation of such merger, consolidation or similar transaction, the
stockholders of the Company immediately prior thereto do not own, directly or
indirectly, outstanding voting securities representing more than 50% of the
combined outstanding voting power of the surviving entity in such merger,
consolidation or similar transaction or more than 50% of the combined
outstanding voting power of the parent of the surviving entity in such merger,
consolidation or similar transaction; or

 

(iii)    there is consummated a sale, lease, license or other disposition of all
or substantially all of the consolidated assets of the Company and its
subsidiaries, other than a sale, lease, license or other disposition of all or
substantially all of the consolidated assets of the Company and its subsidiaries
to an entity, more than 50% of the combined voting power of the

 

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voting securities of which are owned by stockholders of the Company in
substantially the same proportions as their ownership of the Company immediately
prior to such sale, lease, license or other disposition.

 

Once a Change of Control has occurred, no future events will constitute a Change
of Control for purposes of the Plan.

 

(e)    “Company” means Telik, Inc. or, following a Change of Control, the
surviving entity resulting from such transaction or the parent company of such
surviving entity.

 

(f)    “Covered Benefit Plan” means any medical, dental, group term life,
accidental death and dismemberment, optional group term life, short term
disability and long term disability plan sponsored by the Company for the
benefit of its employees.

 

(g)    “Covered Termination” means either an Involuntary Termination Without
Cause or a voluntary termination by an Eligible Employee for any reason or no
reason which occurs within 12 months following the effective date of a Change of
Control.

 

(h)    “Eligible Employee” means an employee of the Company who has been
designated by the Board as an Eligible Employee and whose employment with the
Company terminates due to a Covered Termination.

 

(i)    “Involuntary Termination Without Cause” means an Eligible Employee’s
involuntary termination of employment by the Company for a reason other than
Cause. “Cause” means the occurrence of any one or more of the following:

 

(i)    the Eligible Employee’s conviction of, or plea of no contest with respect
to, any crime involving fraud, dishonesty or moral turpitude;

 

(ii)    the Eligible Employee’s attempted commission of or participation in a
fraud or act of dishonesty against the Company that results in (or might have
reasonably resulted in) material harm to the business of the Company;

 

(iii)    the Eligible Employee’s intentional, material violation of any contract
or agreement between the Eligible Employee and the Company or any statutory duty
the Eligible Employee owes to the Company; or

 

(iv)    the Eligible Employee’s conduct that constitutes gross misconduct,
insubordination, incompetence or habitual neglect of duties and that results in
(or might have reasonably resulted in) material harm to the business of the
Company.

 

The conduct described under clause (iii) or (iv) above will only constitute
Cause if such conduct is not cured within 15 days after the Eligible Employee’s
receipt of written notice from the Company or the Board specifying the
particulars of the conduct that may constitute Cause.

 

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(j)    “Participation Agreement” means the agreement executed by the Company and
an Eligible Employee pursuant to which such Eligible Employee will participate
in the Plan.

 

Section 3.    ELIGIBILITY FOR BENEFITS.

 

Subject to the requirement set forth in this Section, the Company will provide
the severance benefits described in Section 4 to Eligible Employees whose
employment is terminated pursuant to a Covered Termination. In order to be
eligible to receive benefits under the Plan, an Eligible Employee must execute a
general waiver and release in substantially the form attached hereto as EXHIBIT
A, EXHIBIT B or EXHIBIT C, as appropriate, and such release must become
effective in accordance with its terms. The Company, in its discretion, may
modify the form of the required release to comply with applicable law and shall
determine the form of the required release, which may be incorporated into a
termination agreement or other agreement with the Eligible Employee.

 

Section 4.    AMOUNT OF BENEFIT.

 

(a)    Severance Benefits.    Each Eligible Employee shall be designated as a
either a Level I, Level II or Level III Eligible Employee. Severance benefits
under the Plan, if any, shall be provided to each Eligible Employee based on his
or her designation as a Level I, Level II or Level III Eligible Employee, in the
respective amounts provided in APPENDIX A, APPENDIX B or APPENDIX C attached
hereto.

 

(b)    Certain Reductions.    The Company, in its sole discretion, shall have
the authority to reduce an Eligible Employee’s severance benefits, in whole or
in part, by any other severance benefits, pay in lieu of notice, or other
similar benefits payable to the Eligible Employee by the Company in connection
with the Eligible Employee’s termination of employment pursuant to (i) any
applicable legal requirement, including, without limitation, the Worker
Adjustment and Retraining Notification Act (also known as the “WARN Act”), (ii)
an individually negotiated contract or agreement by and between an Eligible
Employee and the Company relating to severance benefits payable following a
Change of Control that is in effect on his or her termination date, unless the
Eligible Employee has expressly waived his or her rights under such individually
negotiated contract or agreement in the applicable Participation Agreement, or
(iii) any Company policy or practice providing for the Eligible Employee to
remain on the payroll for a limited period of time after being given notice of
the termination of the Eligible Employee’s employment. The benefits provided
under the Plan are intended to satisfy, in whole or in part, any and all
statutory obligations that may arise out of an Eligible Employee’s termination
of employment, and the Plan Administrator shall so construe and implement the
terms of the Plan. The Company’s decision to apply such reductions to the
severance benefits of one Eligible Employee and the amount of such reductions
shall in no way obligate the Company to apply the same reductions in the same
amounts to the severance benefits of any other Eligible Employee, even if
similarly situated. In the Company’s sole discretion, such reductions may be
applied on a retroactive basis, with severance benefits previously paid being
recharacterized as payments pursuant to the Company’s statutory obligation.

 

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Section 5.    LIMITATIONS ON BENEFITS.

 

(a)    Mitigation.    Except as otherwise specifically provided herein, an
Eligible Employee shall not be required to mitigate damages or the amount of any
payment provided under the Plan by seeking other employment or otherwise, nor
shall the amount of any payment provided for under the Plan be reduced by any
compensation earned by an Eligible Employee as a result of employment by another
employer or any retirement benefits received by such Eligible Employee after the
date of the Covered Termination.

 

(b)    Termination of Benefits.    Benefits under the Plan shall terminate
immediately if the Eligible Employee, at any time, violates any proprietary
information or confidentiality obligation to the Company.

 

(c)    Non-Duplication of Benefits.    No Eligible Employee is eligible to
receive benefits under the Plan more than one time.

 

(d)    Indebtedness of Eligible Employees.    If an Eligible Employee is
indebted to the Company or an affiliate of the Company on the date of his or her
Covered Termination, the Company reserves the right to offset any severance
benefits under the Plan by the amount of such indebtedness.

 

Section 6.    RIGHT TO INTERPRET PLAN; AMENDMENT AND TERMINATION; OTHER
AGREEMENTS.

 

(a)    Exclusive Discretion.    The Plan Administrator shall have the exclusive
discretion and authority to establish rules, forms, and procedures for the
administration of the Plan and to construe and interpret the Plan and to decide
any and all questions of fact, interpretation, definition, computation or
administration arising in connection with the operation of the Plan, including,
but not limited to, the eligibility to participate in the Plan and amount of
benefits paid under the Plan. The rules, interpretations, computations and other
actions of the Plan Administrator shall be binding and conclusive on all
persons.

 

(b)    Amendment or Termination.    The Company reserves the right to amend or
terminate the Plan (including the Exhibits and Appendices attached hereto) and
the benefits provided hereunder at any time.

 

(c)    Absence of Other Agreements; Conflicts.    The Plan and an Eligible
Employee’s Participation Agreement, and any subsequently adopted amendment to
either of these documents, shall constitute the entire agreement between the
Company and such Eligible Employee regarding benefits under the Plan. No oral
statement regarding the Plan may be relied upon by an Eligible Employee. If
there are any conflicts between the terms of the Plan and an Eligible Employee’s
Participation Agreement, the terms of the Plan shall control.

 

Section 7.    NO IMPLIED EMPLOYMENT CONTRACT.

 

The Plan shall not be deemed (i) to give any employee or other person any right
to be retained in the employ of the Company or (ii) to interfere with the right
of the Company to

 

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discharge any employee or other person at any time, with or without cause, which
right is hereby reserved.

 

Section 8.    LEGAL CONSTRUCTION.

 

The Plan is intended to be governed by and shall be construed in accordance with
the Employee Retirement Income Security Act of 1974 (“ERISA”) and, to the extent
not preempted by ERISA, the laws of the State of California.

 

Section 9.    CLAIMS, INQUIRIES AND APPEALS.

 

(a)    Applications for Benefits and Inquiries.    Any application for benefits,
inquiries about the Plan or inquiries about present or future rights under the
Plan must be submitted to the Plan Administrator in writing by an applicant (or
his or her authorized representative) at the following address:

 

Telik, Inc.

750 Gateway Boulevard

South San Francisco, CA 94080

 

(b)    Denial of Claims.    In the event that any application for benefits is
denied in whole or in part, the Plan Administrator must provide the applicant
with written or electronic notice of the denial of the application, and of the
applicant’s right to review the denial. Any electronic notice will comply with
the regulations of the U.S. Department of Labor. The notice of denial will be
set forth in a manner designed to be understood by the applicant and will
include the following:

 

(i)    the specific reason or reasons for the denial;

 

(ii)    references to the specific Plan provisions upon which the denial is
based;

 

(iii)    a description of any additional information or material that the Plan
Administrator needs to complete the review and an explanation of why such
information or material is necessary; and

 

(iv)    an explanation of the Plan’s review procedures and the time limits
applicable to such procedures, including a statement of the applicant’s right to
bring a civil action under Section 502(a) of ERISA following a denial on review
of the claim, as described in Section 9(d) below.

 

This notice of denial will be given to the applicant within 90 days after the
Plan Administrator receives the application, unless special circumstances
require an extension of time, in which case, the Plan Administrator has up to an
additional 90 days for processing the application. If an extension of time for
processing is required, written notice of the extension will be furnished to the
applicant before the end of the initial 90 day period.

 

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This notice of extension will describe the special circumstances necessitating
the additional time and the date by which the Plan Administrator is to render
its decision on the application.

 

(c)    Request for a Review.    Any person (or that person’s authorized
representative) for whom an application for benefits is denied, in whole or in
part, may appeal the denial by submitting a request for a review to the Plan
Administrator within 60 days after the application is denied to the following
address:

 

Telik, Inc.

750 Gateway Boulevard

South San Francisco, CA 94080

 

A request for review must set forth all of the grounds on which it is based, all
facts in support of the request and any other matters that the applicant feels
are pertinent. The applicant (or his or her representative) shall have the
opportunity to submit (or the Plan Administrator may require the applicant to
submit) written comments, documents, records, and other information relating to
his or her claim. The applicant (or his or her representative) shall be
provided, upon request and free of charge, reasonable access to, and copies of,
all documents, records and other information relevant to his or her claim. The
review shall take into account all comments, documents, records and other
information submitted by the applicant (or his or her representative) relating
to the claim, without regard to whether such information was submitted or
considered in the initial benefit determination.

 

(d)    Decision on Review.    The Plan Administrator will act on each request
for review within 60 days after receipt of the request, unless special
circumstances require an extension of time (not to exceed an additional 60
days), for processing the request for a review. If an extension for review is
required, written notice of the extension will be furnished to the applicant
within the initial 60 day period. This notice of extension will describe the
special circumstances necessitating the additional time and the date by which
the Plan Administrator is to render its decision on the review. The Plan
Administrator will give prompt, written or electronic notice of its decision to
the applicant. Any electronic notice will comply with the regulations of the
U.S. Department of Labor. In the event that the Plan Administrator confirms the
denial of the application for benefits in whole or in part, the notice will set
forth, in a manner calculated to be understood by the applicant, the following:

 

(i)    the specific reason or reasons for the denial;

 

(ii)    references to the specific Plan provisions upon which the denial is
based;

 

(iii)    a statement that the applicant is entitled to receive, upon request and
free of charge, reasonable access to, and copies of, all documents, records and
other information relevant to his or her claim; and

 

(iv)    a statement of the applicant’s right to bring a civil action under
Section 502(a) of ERISA.

 

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(e)    Rules and Procedures.    The Plan Administrator will establish rules and
procedures, consistent with the Plan and with ERISA, as necessary and
appropriate in carrying out its responsibilities in reviewing benefit claims.
The Plan Administrator may require an applicant who wishes to submit additional
information in connection with an appeal from the denial of benefits to do so at
the applicant’s own expense.

 

(f)    Exhaustion of Remedies.    No legal action for benefits under the Plan
may be brought until the claimant (i) has submitted a written application for
benefits in accordance with the procedures described by Section 9(a) above, (ii)
has been notified by the Plan Administrator that the application is denied,
(iii) has filed a written request for a review of the application in accordance
with the appeal procedure described in Section 9(c) above, and (iv) has been
notified that the Plan Administrator has denied the appeal. Notwithstanding the
foregoing, if the Plan Administrator does not respond to a Participant’s claim
or appeal within the relevant time limits specified in this Section 9, the
Participant may bring legal action for benefits under the Plan pursuant to
Section 502(a) of ERISA.

 

Section 10.    BASIS OF PAYMENTS TO AND FROM PLAN.

 

All benefits under the Plan shall be paid by the Company. The Plan shall be
unfunded, and benefits hereunder shall be paid only from the general assets of
the Company.

 

Section 11.    OTHER PLAN INFORMATION.

 

(a)    Employer and Plan Identification Numbers.    The Employer Identification
Number assigned to the Company (which is the “Plan Sponsor” as that term is used
in ERISA) by the Internal Revenue Service is 93-0987903. The Plan Number
assigned to the Plan by the Plan Sponsor pursuant to the instructions of the
Internal Revenue Service is 510.

 

(b)    Ending Date for Plan’s Fiscal Year.    The date of the end of the fiscal
year for the purpose of maintaining the Plan’s records is December 31.

 

(c)    Agent for the Service of Legal Process.    The agent for the service of
legal process with respect to the Plan is Telik, Inc., 750 Gateway Boulevard,
South San Francisco, CA 94080.

 

(d)    Plan Sponsor and Administrator.    The “Plan Sponsor” and the “Plan
Administrator” of the Plan is Telik, Inc., 750 Gateway Boulevard, South San
Francisco, CA 94080. The Plan Sponsor’s and Plan Administrator’s telephone
number is (650) 244-9303. The Plan Administrator is the named fiduciary charged
with the responsibility for administering the Plan.

 

Section 12.    STATEMENT OF ERISA RIGHTS.

 

Participants in this Plan (which is a welfare benefit plan sponsored by the
Company) are entitled to certain rights and protections under ERISA. If you are
an Eligible Employee, you are considered a participant in the Plan and, under
ERISA, you are entitled to:

 

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Receive Information About Your Plan and Benefits

 

(a)    Examine, without charge, at the Plan Administrator’s office and at other
specified locations, such as worksites, all documents governing the Plan and a
copy of the latest annual report (Form 5500 Series) filed by the Plan with the
U.S. Department of Labor and available at the Public Disclosure Room of the
Pension and Welfare Benefit Administration;

 

(b)    Obtain, upon written request to the Plan Administrator, copies of
documents governing the operation of the Plan and copies of the latest annual
report (Form 5500 Series) and updated Summary Plan Description. The
Administrator may make a reasonable charge for the copies; and

 

(c)    Receive a summary of the Plan’s annual financial report. The Plan
Administrator is required by law to furnish each participant with a copy of this
summary annual report.

 

 

Prudent Actions by Plan Fiduciaries

 

In addition to creating rights for Plan participants, ERISA imposes duties upon
the people who are responsible for the operation of the employee benefit plan.
The people who operate the Plan, called “fiduciaries” of the Plan, have a duty
to do so prudently and in the interest of you and other Plan participants and
beneficiaries. No one, including your employer, your union or any other person,
may fire you or otherwise discriminate against you in any way to prevent you
from obtaining a Plan benefit or exercising your rights under ERISA.

 

 

Enforce Your Rights

 

If your claim for a Plan benefit is denied or ignored, in whole or in part, you
have a right to know why this was done, to obtain copies of documents relating
to the decision without charge, and to appeal any denial, all within certain
time schedules.

 

Under ERISA, there are steps you can take to enforce the above rights. For
instance, if you request a copy of Plan documents or the latest annual report
from the Plan and do not receive them within 30 days, you may file suit in a
Federal court. In such a case, the court may require the Plan Administrator to
provide the materials and pay you up to $110 a day until you receive the
materials, unless the materials were not sent because of reasons beyond the
control of the Administrator.

 

If you have a claim for benefits which is denied or ignored, in whole or in
part, you may file suit in a state or Federal court. In addition, if you
disagree with the Plan’s decision or lack thereof concerning the qualified
status of a domestic relations order or a medical child support order, you may
file suit in Federal court.

 

If it should happen that Plan fiduciaries misuse the Plan’s money, or if you are
discriminated against for asserting your rights, you may seek assistance from
the U.S. Department of Labor, or you may file suit in a Federal court. The court
will decide who should pay court costs and legal fees. If you are successful,
the court may order the person you have

 

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sued to pay these costs and fees. If you lose, the court may order you to pay
these costs and fees, for example, if it finds your claim is frivolous.

 

 

Assistance with Your Questions

 

If you have any questions about the Plan, you should contact the Plan
Administrator. If you have any questions about this statement or about your
rights under ERISA, or if you need assistance in obtaining documents from the
Plan Administrator, you should contact the nearest office of the Pension and
Welfare Benefits Administration, U.S. Department of Labor, listed in your
telephone directory or the Division of Technical Assistance and Inquiries,
Pension and Welfare Benefits Administration, U.S. Department of Labor, 200
Constitution Avenue N.W., Washington, D.C. 20210. You may also obtain certain
publications about your rights and responsibilities under ERISA by calling the
publications hotline of the Pension and Welfare Benefits Administration.

 

Section 13.    EXECUTION.

 

To record the adoption of the Plan as set forth herein, effective as of February
21, 2003, Telik Inc. has caused its duly authorized officer to execute the same
this 21st day of February, 2003.

 

TELIK, INC.

By:

 

/s/    MICHAEL M. WICK

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Michael M. Wick, M.D., Ph.D.

Title:

 

Chairman and Chief Executive Officer

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EXHIBIT A

 

RELEASE AGREEMENT

(For Employees Age 40 or Older—Individual Termination)

 

I understand and agree completely to the terms set forth in the Telik, Inc.
Change of Control Severance Benefit Plan (the “Plan”). Certain capitalized terms
used in this Release Agreement are defined in the Plan.

 

I hereby confirm my obligations under the Company’s proprietary information and
inventions agreement.

 

I acknowledge that I have read and understand Section 1542 of the California
Civil Code which reads 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.” I hereby expressly waive and relinquish all rights
and benefits under that section and any law of any jurisdiction of similar
effect with respect to my release of any claims I may have against the Company.

 

I hereby expressly waive and relinquish all rights and benefits under that
section and any law of any jurisdiction of similar effect with respect to my
release of any claims I may have against the Company.

 

In exchange for the benefits I am receiving under the Plan to which I am
otherwise not entitled, I hereby generally and completely release the Company
and its directors, officers, employees, shareholders, partners, agents,
attorneys, predecessors, successors, parent and subsidiary entities, insurers,
affiliates, and assigns from any and all claims, liabilities and obligations,
both known and unknown, that arise out of or are in any way related to events,
acts, conduct, or omissions occurring prior to my signing this Agreement. This
general release includes, but is not limited to: (1) all claims arising out of
or in any way related to my employment with the Company or the termination of
that employment; (2) all claims related to my compensation or benefits from the
Company, including salary, bonuses, commissions, vacation pay, expense
reimbursements, severance pay, fringe benefits, stock, stock options, or any
other ownership interests in the Company; (3) all claims for breach of contract,
wrongful termination, and breach of the implied covenant of good faith and fair
dealing; (4) all tort claims, including claims for fraud, defamation, emotional
distress, and discharge in violation of public policy; and (5) all federal,
state, and local statutory claims, including claims for discrimination,
harassment, retaliation, attorneys’ fees, or other claims arising under the
federal Civil Rights Act of 1964 (as amended), the federal Americans with
Disabilities Act of 1990, the federal Age Discrimination in Employment Act of
1967 (as amended) (“ADEA”), and the California Fair Employment and Housing Act
(as amended).

 

I acknowledge that I am knowingly and voluntarily waiving and releasing any
rights I may have under ADEA. I also acknowledge that the consideration given
under the Plan for the waiver and release in the preceding paragraph hereof is
in addition to anything of value to which I was already entitled. I further
acknowledge that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or claims that

 

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may arise on or after the date I execute this Release Agreement; (B) I have the
right to consult with an attorney prior to executing this Release Agreement; (C)
I have 21 days to consider this Release Agreement (although I may choose to
voluntarily execute it earlier); (D) I have seven days following my execution of
this Release Agreement to revoke it; and (E) this Release Agreement shall not be
effective until the date upon which the revocation period has expired, which
shall be the eighth day after I execute this Release Agreement.

 

EMPLOYEE

Name:

 

 

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Date:

 

 

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EXHIBIT B

 

RELEASE AGREEMENT

(For Employees Under Age 40—Individual and Group Termination)

 

I understand and agree completely to the terms set forth in the Telik, Inc.
Change of Control Severance Benefit Plan (the “Plan”). Certain capitalized terms
used in this Release Agreement are defined in the Plan.

 

I hereby confirm my obligations under the Company’s proprietary information and
inventions agreement.

 

I acknowledge that I have read and understand Section 1542 of the California
Civil Code which reads 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.” I hereby expressly waive and relinquish all rights
and benefits under that section and any law of any jurisdiction of similar
effect with respect to my release of any claims I may have against the Company.

 

In exchange for the benefits I am receiving under the Plan to which I am
otherwise not entitled, I hereby generally and completely release the Company
and its directors, officers, employees, shareholders, partners, agents,
attorneys, predecessors, successors, parent and subsidiary entities, insurers,
affiliates, and assigns from any and all claims, liabilities and obligations,
both known and unknown, that arise out of or are in any way related to events,
acts, conduct, or omissions occurring prior to my signing this Agreement. This
general release includes, but is not limited to: (1) all claims arising out of
or in any way related to my employment with the Company or the termination of
that employment; (2) all claims related to my compensation or benefits from the
Company, including salary, bonuses, commissions, vacation pay, expense
reimbursements, severance pay, fringe benefits, stock, stock options, or any
other ownership interests in the Company; (3) all claims for breach of contract,
wrongful termination, and breach of the implied covenant of good faith and fair
dealing; (4) all tort claims, including claims for fraud, defamation, emotional
distress, and discharge in violation of public policy; and (5) all federal,
state, and local statutory claims, including claims for discrimination,
harassment, retaliation, attorneys’ fees, or other claims arising under the
federal Civil Rights Act of 1964 (as amended), the federal Americans with
Disabilities Act of 1990, and the California Fair Employment and Housing Act (as
amended).

 

I understand that I have seven days to consider this Release Agreement (although
I may voluntarily execute it earlier).

 

EMPLOYEE

Name:

 

 

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Date:

 

 

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EXHIBIT C

 

RELEASE AGREEMENT

(For Employees Age 40 or Older—Group Termination)

 

I understand and agree completely to the terms set forth in the Telik, Inc.
Change of Control Severance Benefit Plan (the “Plan”). Certain capitalized terms
used in this Release Agreement are defined in the Plan.

 

I hereby confirm my obligations under the Company’s proprietary information and
inventions agreement.

 

I acknowledge that I have read and understand Section 1542 of the California
Civil Code which reads 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.” I hereby expressly waive and relinquish all rights
and benefits under that section and any law of any jurisdiction of similar
effect with respect to my release of any claims I may have against the Company.

 

In exchange for the benefits I am receiving under the Plan to which I am
otherwise not entitled, I hereby generally and completely release the Company
and its directors, officers, employees, shareholders, partners, agents,
attorneys, predecessors, successors, parent and subsidiary entities, insurers,
affiliates, and assigns from any and all claims, liabilities and obligations,
both known and unknown, that arise out of or are in any way related to events,
acts, conduct, or omissions occurring prior to my signing this Agreement. This
general release includes, but is not limited to: (1) all claims arising out of
or in any way related to my employment with the Company or the termination of
that employment; (2) all claims related to my compensation or benefits from the
Company, including salary, bonuses, commissions, vacation pay, expense
reimbursements, severance pay, fringe benefits, stock, stock options, or any
other ownership interests in the Company; (3) all claims for breach of contract,
wrongful termination, and breach of the implied covenant of good faith and fair
dealing; (4) all tort claims, including claims for fraud, defamation, emotional
distress, and discharge in violation of public policy; and (5) all federal,
state, and local statutory claims, including claims for discrimination,
harassment, retaliation, attorneys’ fees, or other claims arising under the
federal Civil Rights Act of 1964 (as amended), the federal Americans with
Disabilities Act of 1990, the federal Age Discrimination in Employment Act of
1967 (as amended) (“ADEA”), and the California Fair Employment and Housing Act
(as amended).

 

I acknowledge that I am knowingly and voluntarily waiving and releasing any
rights I may have under ADEA. I also acknowledge that the consideration given
under the Plan for the waiver and release in the preceding paragraph hereof is
in addition to anything of value to which I was already entitled. I further
acknowledge that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or claims that may
arise on or after the date I execute this Release Agreement; (B) I have the
right to consult with an attorney prior to executing this Release Agreement; (C)
I have 45 days to consider this Release Agreement (although I may choose to
voluntarily execute it earlier); (D) I have seven

 

1.

--------------------------------------------------------------------------------

 

days following my execution of this Release Agreement to revoke it; (E) this
Release Agreement shall not be effective until the date upon which the
revocation period has expired, which shall be the eighth day after I execute
this Release Agreement; and (F) I have received with this Release Agreement a
detailed list of the job titles and ages of all employees who are eligible for
severance benefits under the Plan in this group termination and the ages of all
employees of the Company in the same job classification or organizational unit
who are not eligible for severance benefits under the Plan.

 

EMPLOYEE

Name:

 

 

--------------------------------------------------------------------------------

Date:

 

 

--------------------------------------------------------------------------------

 

2.

--------------------------------------------------------------------------------

 

APPENDIX A

 

TELIK, INC.

CHANGE OF CONTROL SEVERANCE BENEFIT PLAN

 

LEVEL I ELIGIBLE EMPLOYEES

 

Severance benefits provided to Eligible Employees under the Telik, Inc. Change
of Control Severance Benefit Plan (the “Plan”) are set forth below. Capitalized
terms not explicitly defined in this APPENDIX A but defined in the Plan shall
have the same definitions as in the Plan.

 

Each Eligible Employee who is designated in the Participation Agreement as being
in Level I shall receive the following benefits as a result of a Covered
Termination:

 

1.   Cash Severance Benefits.    Within ten days following a Covered
Termination, the Eligible Employee shall receive a lump sum cash payment equal
to two times the greater of: (i) the sum of the Eligible Employee’s Base Salary
and the greater of: (a) the annual cash bonus paid to the Eligible Employee in
the prior year; or (b) the Eligible Employee’s Annual Target Bonus as in effect
on the date of the Covered Termination; or (ii) the sum of Eligible Employee’s
Base Salary and the greater of: (a) the annual cash bonus paid to such Eligible
Employee in the prior year; or (b) the Eligible Employee’s Annual Target Bonus
as in effect immediately prior to the Change of Control. Such payment shall be
subject to all applicable tax withholding.

 

2.   Employee Benefit Plans.    With respect to each Eligible Employee who is
enrolled in or participates in a Covered Benefit Plan sponsored by the Company
on the date of his or her Covered Termination, the Company shall pay that
portion of the coverage premiums of the Eligible Employee (and his or her
eligible dependents) under such Covered Benefit Plan which the Company paid
prior to the Covered Termination for 24 months following the date of the Covered
Termination; provided, however, that no such premium payments shall be made
following the effective date of the Eligible Employee’s coverage by a plan (or
plans) provided by a subsequent employer which includes benefits that, taken as
a whole, are substantially equivalent to the Covered Benefit Plans. Each
Eligible Employee shall be required to notify the Company immediately if the
Eligible Employee becomes covered by a benefit plan provided by a subsequent
employer.

 

3.   COBRA Continuation Coverage.    Each Level I Eligible Employee who is
enrolled in a health, dental, or vision plan sponsored by the Company may be
eligible to continue coverage under such health, dental, or vision plan (or to
convert to an individual policy), at the time of the Eligible Employee’s Covered
Termination, under the Consolidated Omnibus Budget Reconciliation Act of 1985
(“COBRA”). The Company will notify the Eligible Employee of any such right to
continue such coverage at the time of termination pursuant to COBRA. No
provision of this Plan will affect the continuation coverage rules under COBRA,
except that the Company’s payment, if any, of applicable insurance premiums
pursuant to Section 2 above, will be credited as payment by the Eligible
Employee for purposes of the Eligible Employee’s payment required under COBRA.
Therefore, the period during which an Eligible Employee may elect to continue
the

 

1.

--------------------------------------------------------------------------------

Company’s health, dental, or vision plan coverage at his or her own expense
under COBRA, the length of time during which COBRA coverage will be made
available to the Eligible Employee, and all other rights and obligations of the
Eligible Employee under COBRA (except the obligation to pay insurance premiums
that the Company may, in its sole discretion, elect to pay pursuant to Section 2
above) will be applied in the same manner that such rules would apply in the
absence of this Plan. Upon the expiration of the 24 month period during which
the Company pays the Eligible Employee’s insurance premiums, the Eligible
Employee will be responsible for the entire payment of premiums required under
COBRA for the duration of the COBRA period, if any. For purposes of this Section
3, any applicable premiums that may be paid by the Company shall not include any
amounts payable by an Eligible Employee under an Internal Revenue Code Section
125 health care reimbursement plan, which amounts, if any, are the sole
responsibility of the Eligible Employee.

 

4.   Stock Option Vesting.    Following an Eligible Employee’s Covered
Termination, all of such Eligible Employee’s unvested stock options shall
immediately vest and become immediately exercisable.

 

5.   Parachute Payments.    If any payment, distribution or benefit you would
receive from the Company or otherwise, but determined without regard to any
additional payment required under this Section 5, pursuant to a Change of
Control of the Company (“Payment”), would (i) constitute a “parachute payment”
within the meaning of Section 280G of the Internal Revenue Code of 1986, as
amended (the “Code”), and (ii) be subject to the excise tax imposed by Section
4999 of the Code or any interest or penalties payable with respect to such
excise tax (such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the “Excise Tax”), then you shall be
entitled to receive from the Company an additional payment (the “Gross-Up
Payment”) in an amount that shall fund the payment by you of any Excise Tax on
the Payment as well as all income and employment taxes imposed on the Gross-Up
Payment, any Excise Tax imposed on the Gross-Up Payment and any interest or
penalties imposed with respect to income and employment taxes imposed on the
Gross-Up Payment.

 

The accounting firm engaged by the Company for general audit purposes as of the
day prior to the effective date of the Change of Control shall perform the
foregoing calculations. If the accounting firm so engaged by the Company is
serving as accountant or auditor for the individual, entity or group effecting
the Change of Control, the Company shall appoint a nationally recognized
accounting firm to make the determinations required hereunder. The Company shall
bear all expenses with respect to the determinations by such accounting firm
required to be made hereunder.

 

The accounting firm engaged to make the determinations hereunder shall provide
its calculations, together with detailed supporting documentation, to the
Company and you within fifteen (15) calendar days after the date on which your
right to a Payment is triggered (if requested at that time by the Company or
you) or such other time as requested by the Company or you. If the accounting
firm determines that no Excise Tax is payable with respect to a Payment, it
shall furnish the Company and you with an opinion reasonably acceptable to you
that no Excise Tax will be imposed with respect to

 

2.

--------------------------------------------------------------------------------

 

such Payment. Any good faith determinations of the accounting firm made
hereunder shall be final, binding and conclusive upon the Company and you.

 

6.   Other Employee Benefits.    Except as provided in Section 2 above (and
except to the extent that a conversion privilege may be available thereunder),
all benefits provided by the Company shall terminate as of the date of the
Eligible Employee’s Covered Termination.

 

7.   Reductions Pursuant to Section 4(b) of the Plan.    The severance benefits
set forth in this APPENDIX A are subject to certain reductions under Section
4(b) of the Plan.

 

The Plan Administrator reserves the right to amend this APPENDIX A and the
benefits provided hereunder at any time.

 

APPENDIX A Adopted: February 21, 2003

 

TELIK, INC.

By:

 

/s/    MICHAEL M. WICK

--------------------------------------------------------------------------------

Michael M. Wick, M.D., Ph.D.

Title:

 

Chairman and Chief Executive Officer

--------------------------------------------------------------------------------

 

3.

--------------------------------------------------------------------------------

 

APPENDIX B

 

TELIK, INC.

CHANGE OF CONTROL SEVERANCE BENEFIT PLAN

 

LEVEL II ELIGIBLE EMPLOYEES

 

Severance benefits provided to Eligible Employees under the Telik, Inc. Change
of Control Severance Benefit Plan (the “Plan”) are set forth below. Capitalized
terms not explicitly defined in this APPENDIX B but defined in the Plan shall
have the same definitions as in the Plan.

 

Each Eligible Employee who is designated in the Participation Agreement as being
in Level II shall receive the following benefits as a result of a Covered
Termination:

 

1.   Cash Severance Benefits.    Within ten days following a Covered
Termination, the Eligible Employee shall receive a lump sum cash payment equal
to the greater of: (i) the sum of the Eligible Employee’s Base Salary and the
greater of: (a) the annual cash bonus paid to the Eligible Employee in the prior
year; or (b) the Eligible Employee’s Annual Target Bonus as in effect on the
date of the Covered Termination; or (ii) the sum of Eligible Employee’s Base
Salary and the greater of: (a) the annual cash bonus paid to such Eligible
Employee in the prior year; or (b) the Eligible Employee’s Annual Target Bonus
as in effect immediately prior to the Change of Control. Such payment shall be
subject to all applicable tax withholding.

 

2.   Employee Benefit Plans.    With respect to each Eligible Employee who is
enrolled in or participates in a Covered Benefit Plan sponsored by the Company
on the date of his or her Covered Termination, the Company shall pay that
portion of the coverage premiums of the Eligible Employee (and his or her
eligible dependents) under such Covered Benefit Plan which the Company paid
prior to the Covered Termination for 12 months following the date of the Covered
Termination; provided, however, that no such premium payments shall be made
following the effective date of the Eligible Employee’s coverage by a plan (or
plans) provided by a subsequent employer which includes benefits that, taken as
a whole, are substantially equivalent to the Covered Benefit Plans. Each
Eligible Employee shall be required to notify the Company immediately if the
Eligible Employee becomes covered by a benefit plan provided by a subsequent
employer.

 

3.   COBRA Continuation Coverage.    Each Level II Eligible Employee who is
enrolled in a health, dental, or vision plan sponsored by the Company may be
eligible to continue coverage under such health, dental, or vision plan (or to
convert to an individual policy), at the time of the Eligible Employee’s Covered
Termination, under the Consolidated Omnibus Budget Reconciliation Act of 1985
(“COBRA”). The Company will notify the Eligible Employee of any such right to
continue such coverage at the time of termination pursuant to COBRA. No
provision of this Plan will affect the continuation coverage rules under COBRA,
except that the Company’s payment, if any, of applicable insurance premiums
pursuant to Section 2 above, will be credited as payment by the Eligible
Employee for purposes of the Eligible Employee’s payment required under COBRA.
Therefore, the period during which an Eligible Employee may elect to continue
the

 

1.

--------------------------------------------------------------------------------

 

Company’s health, dental, or vision plan coverage at his or her own expense
under COBRA, the length of time during which COBRA coverage will be made
available to the Eligible Employee, and all other rights and obligations of the
Eligible Employee under COBRA (except the obligation to pay insurance premiums
that the Company may, in its sole discretion, elect to pay pursuant to Section 2
above) will be applied in the same manner that such rules would apply in the
absence of this Plan. Upon the expiration of the 12 month period during which
the Company pays the Eligible Employee’s insurance premiums, the Eligible
Employee will be responsible for the entire payment of premiums required under
COBRA for the duration of the COBRA period. For purposes of this Section 3, any
applicable premiums that may be paid by the Company shall not include any
amounts payable by an Eligible Employee under an Internal Revenue Code Section
125 health care reimbursement plan, which amounts, if any, are the sole
responsibility of the Eligible Employee.

 

4.   Stock Option Vesting.    Following an Eligible Employee’s Covered
Termination, all of such Eligible Employee’s unvested stock options shall
immediately vest and become immediately exercisable.

 

5.   Parachute Payments.    If any payment, distribution or benefit you would
receive from the Company or otherwise, but determined without regard to any
additional payment required under this Section 5, pursuant to a Change of
Control of the Company (“Payment”), would (i) constitute a “parachute payment”
within the meaning of Section 280G of the Internal Revenue Code of 1986, as
amended (the “Code”), and (ii) be subject to the excise tax imposed by Section
4999 of the Code or any interest or penalties payable with respect to such
excise tax (such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the “Excise Tax”), then you shall be
entitled to receive from the Company an additional payment (the “Gross-Up
Payment”) in an amount that shall fund the payment by you of any Excise Tax on
the Payment as well as all income and employment taxes imposed on the Gross-Up
Payment, any Excise Tax imposed on the Gross-Up Payment and any interest or
penalties imposed with respect to income and employment taxes imposed on the
Gross-Up Payment.

 

The accounting firm engaged by the Company for general audit purposes as of the
day prior to the effective date of the Change of Control shall perform the
foregoing calculations. If the accounting firm so engaged by the Company is
serving as accountant or auditor for the individual, entity or group effecting
the Change of Control, the Company shall appoint a nationally recognized
accounting firm to make the determinations required hereunder. The Company shall
bear all expenses with respect to the determinations by such accounting firm
required to be made hereunder.

 

The accounting firm engaged to make the determinations hereunder shall provide
its calculations, together with detailed supporting documentation, to the
Company and you within fifteen (15) calendar days after the date on which your
right to a Payment is triggered (if requested at that time by the Company or
you) or such other time as requested by the Company or you. If the accounting
firm determines that no Excise Tax is payable with respect to a Payment, it
shall furnish the Company and you with an opinion reasonably acceptable to you
that no Excise Tax will be imposed with respect to

 

19

--------------------------------------------------------------------------------

 

such Payment. Any good faith determinations of the accounting firm made
hereunder shall be final, binding and conclusive upon the Company and you.

 

6.   Other Employee Benefits.    Except as provided in Section 2 above (and
except to the extent that a conversion privilege may be available thereunder),
all benefits provided by the Company shall terminate as of the date of the
Eligible Employee’s Covered Termination.

 

7.   Reductions Pursuant to Section 4(b) of the Plan.    The severance benefits
set forth in this APPENDIX B are subject to certain reductions under Section
4(b) of the Plan.

 

The Plan Administrator reserves the right to amend this APPENDIX B and the
benefits provided hereunder at any time.

 

APPENDIX B Adopted: February 21, 2003

 

TELIK, INC.

By:

 

/s/    MICHAEL M. WICK

--------------------------------------------------------------------------------

Michael M. Wick, M.D., Ph.D.

Title:

 

Chairman and Chief Executive Officer

--------------------------------------------------------------------------------

 

3.

--------------------------------------------------------------------------------

 

APPENDIX C

 

TELIK, INC.

CHANGE OF CONTROL SEVERANCE BENEFIT PLAN

 

LEVEL III ELIGIBLE EMPLOYEES

 

Severance benefits provided to Eligible Employees under the Telik, Inc. Change
of Control Severance Benefit Plan (the “Plan”) are set forth below. Capitalized
terms not explicitly defined in this APPENDIX C but defined in the Plan shall
have the same definitions as in the Plan.

 

Each Eligible Employee who is designated in the Participation Agreement as being
in Level III shall receive the following benefits as a result of a Covered
Termination:

 

1.   Cash Severance Benefits.    Within ten days following a Covered
Termination, such Eligible Employee shall receive a lump sum cash payment equal
50% (or, in the case of an Eligible Employee who has not been continuously
employed by the Company for the two years ending on the date of the Change of
Control, 25%) of the greater of: (i) the sum of the Eligible Employee’s Base
Salary and the greater of: (a) the annual cash bonus paid to the Eligible
Employee in the prior year; or (b) the Eligible Employee’s Annual Target Bonus
as in effect on the date of the Covered Termination; or (ii) the sum of Eligible
Employee’s Base Salary and the greater of: (a) the annual cash bonus paid to
such Eligible Employee in the prior year; or (b) the Eligible Employee’s Annual
Target Bonus as in effect immediately prior to the Change of Control. Such
payment shall be subject to all applicable tax withholding.

 

2.   Employee Benefit Plans.    With respect to each Eligible Employee who is
enrolled in or participates in a Covered Benefit Plan sponsored by the Company
on the date of his or her Covered Termination, the Company shall pay that
portion of the coverage premiums of the Eligible Employee (and his or her
eligible dependents) under such Covered Benefit Plan which the Company paid
prior to the Covered Termination for 6 (or, in the case of an Eligible Employee
who has not been continuously employed by the Company for the two years ending
on the date of the Change of Control, 3) months following the date of the
Covered Termination; provided, however, that no such premium payments shall be
made following the effective date of the Eligible Employee’s coverage by a plan
(or plans) provided by a subsequent employer which includes benefits that, taken
as a whole, are substantially equivalent to the Covered Benefit Plans. Each
Eligible Employee shall be required to notify the Company immediately if the
Eligible Employee becomes covered by a benefit plan provided by a subsequent
employer.

 

3.   COBRA Continuation Coverage.    Each Level III Eligible Employee who is
enrolled in a health, dental, or vision plan sponsored by the Company may be
eligible to continue coverage under such health, dental, or vision plan (or to
convert to an individual policy), at the time of the Eligible Employee’s Covered
Termination, under the Consolidated Omnibus Budget Reconciliation Act of 1985
(“COBRA”). The Company will notify the Eligible Employee of any such right to
continue such coverage at the time of termination pursuant to COBRA. No
provision of this Plan will affect the continuation coverage

 

1.

--------------------------------------------------------------------------------

rules under COBRA, except that the Company’s payment, if any, of applicable
insurance premiums pursuant to Section 2 above, will be credited as payment by
the Eligible Employee for purposes of the Eligible Employee’s payment required
under COBRA. Therefore, the period during which an Eligible Employee may elect
to continue the Company’s health, dental, or vision plan coverage at his or her
own expense under COBRA, the length of time during which COBRA coverage will be
made available to the Eligible Employee, and all other rights and obligations of
the Eligible Employee under COBRA (except the obligation to pay insurance
premiums that the Company may, in its sole discretion, elect to pay pursuant to
Section 2 above) will be applied in the same manner that such rules would apply
in the absence of this Plan. Upon the expiration of the 6-month or 3-month
period, as applicable, during which the Company pays the Eligible Employee’s
insurance premiums, the Eligible Employee will be responsible for the entire
payment of premiums required under COBRA for the duration of the COBRA period.
For purposes of this Section 3, any applicable premiums that may be paid by the
Company shall not include any amounts payable by an Eligible Employee under an
Internal Revenue Code Section 125 health care reimbursement plan, which amounts,
if any, are the sole responsibility of the Eligible Employee.

 

4.   Stock Option Vesting.    Following an Eligible Employee’s Covered
Termination, all of such Eligible Employee’s unvested stock options which
(without giving effect to this sentence) would normally vest within 24 months of
the date of the Covered Termination, shall vest and become immediately
exercisable.

 

5.   Parachute Payments.    If any payment or benefit the Eligible Employee
would receive in connection with a Change of Control from the Company or
otherwise (“Payment”) would (i) constitute a “parachute payment” within the
meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”), and (ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the “Excise Tax”), then such Payment shall be equal to
the Reduced Amount. The “Reduced Amount” shall be either (x) the largest portion
of the Payment that would result in no portion of the Payment being subject to
the Excise Tax or (y) the largest portion, up to and including the total, of the
Payment, whichever amount, after taking into account all applicable federal,
state and local employment taxes, income taxes, and the Excise Tax (all computed
at the highest applicable marginal rate), results in the Eligible Employee’s
receipt, on an after-tax basis, of the greater amount of the Payment
notwithstanding that all or some portion of the Payment may be subject to the
Excise Tax. If a reduction in payments or benefits constituting “parachute
payments” is necessary so that the Payment equals the Reduced Amount, reduction
shall occur in the following order unless the Eligible Employee elects in
writing a different order (provided, however, that such election shall be
subject to Company approval if made on or after the date on which the event that
triggers the Payment occurs): reduction of cash payments; cancellation of
accelerated vesting of stock awards; reduction of employee benefits. If
acceleration of vesting of stock award compensation is to be reduced, such
acceleration of vesting shall be cancelled in the reverse order of the date of
grant of the Eligible Employee’s stock awards unless the Eligible Employee
elects in writing a different order for cancellation.

 

2.

--------------------------------------------------------------------------------

 

The accounting firm engaged by the Company for general audit purposes as of the
day prior to the effective date of the Change of Control shall perform the
foregoing calculations. If the accounting firm so engaged by the Company is
serving as accountant or auditor for the individual, entity or group effecting
the Change of Control, the Company shall appoint a nationally recognized
accounting firm to make the determinations required hereunder. The Company shall
bear all expenses with respect to the determinations by such accounting firm
required to be made hereunder.

 

The accounting firm engaged to make the determinations hereunder shall provide
its calculations, together with detailed supporting documentation, to the
Company and the Eligible Employee within 15 calendar days after the date on
which the Eligible Employee’s right to a Payment is triggered (if requested at
that time by the Company or the Eligible Employee) or such other time as
requested by the Company or the Eligible Employee. If the accounting firm
determines that no Excise Tax is payable with respect to a Payment, either
before or after the application of the Reduced Amount, it shall furnish the
Company and the Eligible Employee with an opinion reasonably acceptable to
Executive that no Excise Tax will be imposed with respect to such Payment. Any
good faith determinations of the accounting firm made hereunder shall be final,
binding and conclusive upon the Company and the Eligible Employee.

 

6.   Other Employee Benefits.    Except as provided in Section 2 above (and
except to the extent that a conversion privilege may be available thereunder),
all benefits provided by the Company shall terminate as of the date of the
Eligible Employee’s Covered Termination.

 

7.   Reductions Pursuant to Section 4(b) of the Plan.    The severance benefits
set forth in this APPENDIX C are subject to certain reductions under Section
4(b) of the Plan.

 

The Plan Administrator reserves the right to amend this APPENDIX C and the
benefits provided hereunder at any time.

 

APPENDIX C Adopted: February 21, 2003

 

TELIK, INC.

By:

 

/s/    MICHAEL M. WICK

--------------------------------------------------------------------------------

Michael M. Wick, M.D., Ph.D.

Title:

 

Chairman and Chief Executive Officer

--------------------------------------------------------------------------------

 

3.

--------------------------------------------------------------------------------

 

SCHEDULE OF BENEFITS LEVELS

PURSUANT TO CHANGE OF CONTROL SEVERANCE BENEFITS PLAN OF TELIK, INC.

 

Level of Benefits

--------------------------------------------------------------------------------

  

Eligible Employee

--------------------------------------------------------------------------------

Level I

  

President and Chief Executive Officer

Level II

  

Chief Operating Officer and Chief Financial Officer and those Senior

Vice Presidents and others, in each case, as designated by the Compensation
Committee or the Chief Executive Officer

Level III

  

Those Senior Vice Presidents, Vice President and others, in each case, as
designated by the Compensation Committee or the Chief Executive Officer

 

--------------------------------------------------------------------------------

 

PARTICIPATION AGREEMENT

 

TELIK, INC.

 

CHANGE OF CONTROL SEVERANCE BENEFIT PLAN

 

Name of Participant: ______________________________

 

You have been selected to participate in the Telik, Inc. Change of Control
Severance Benefit Plan (the “Plan”). Under the terms of the Plan (a copy of
which is attached as EXHIBIT A to this Agreement) you may become entitled to
receive severance benefits in the event your employment with the Company is
terminated in a Covered Termination. A Covered Termination means you are
Involuntarily Terminated Without Cause (as defined in the Plan) or you
voluntarily terminate your employment for any reason or no reason within 12
months following the effective date of a Change of Control (as defined in the
Plan).

 

In accordance with Section 4(a) of the Plan, you have been designated a Level
[I][II][III] Eligible Employee. The schedule of benefits you may become entitled
to receive is found in APPENDIX [A][B][C] to the Plan.

 

If your employment with the Company is terminated for any reason other than a
Covered Termination, you will not be eligible for severance benefits under the
Plan.

 

[You have entered into an individually negotiated written agreement dated
____________ with the Company (the “Other Agreement”) that relates, in whole or
in part, to severance benefits payable following a Change of Control. By signing
this Participation Agreement, you agree to waive your rights under the Other
Agreement to the extent that the Other Agreement relates to severance benefits
payable following a Change of Control. If you elect not to sign this
Participation Agreement, the terms of the Other Agreement will control the
provision of severance benefits, if any, following a Change of Control, and you
will not be an Eligible Participant in the Plan.] OR [You have entered into an
individually negotiated written agreement dated ____________ with the Company
(the “Other Agreement”) that relates, in whole or in part, to severance benefits
payable following a Change of Control. By signing this Participation Agreement,
you agree that any benefits that may become payable under the Plan shall be
offset by any benefits that may become payable under the Other Agreement. If you
elect not to sign this Participation Agreement, the terms of the Other Agreement
will control the provision of severance benefits, if any, following a Change of
Control, and you will not be an Eligible Participant in the Plan.]

 

To participate in the Plan, please sign and date this Participation Agreement in
the space provided below and return it to ____________ no later than
____________. The extra copy is for your file. On behalf of Telik, I am pleased
to welcome you as an Eligible Employee under the Plan.

 

Sincerely,

 

 

--------------------------------------------------------------------------------

   

Michael M. Wick, M.D., Ph.D.

   

Chief Executive Officer

   

 

--------------------------------------------------------------------------------

 

 

--------------------------------------------------------------------------------

Participant’s Signature

 

Date

--------------------------------------------------------------------------------

 

EXHIBIT A

 

TELIK, INC.

CHANGE OF CONTROL SEVERANCE BENEFIT PLAN

 

Please see Exhibit 10.23 filed with the Quarterly Report on Form 10-Q for the
period ended March 31, 2003.