EXHIBIT 10.1
CHANGE IN CONTROL
SEVERANCE AGREEMENT
          This Change in Control Severance Agreement (this “Agreement”) is
entered into as of [DATE] (the “Effective Date”), by and between [NAME] (the
“Executive”) and SGX Pharmaceuticals, Inc., a Delaware corporation (the
“Company”).
Recitals
A.      The Executive is a key member of the management of the Company, and the
Board of Directors of the Company (the “Board”) considers it to be in the best
interests of the Company and its stockholders to foster the retention of its key
management personnel and to create uniformity in the terms of conditions of the
severance and other benefits to which the Executive and its other key management
personnel are entitled upon certain terminations of the Executive’s or such
other key management personnel’s employment or upon a Change in Control (as
defined below).
B.      The Board recognizes that from time to time the Board may consider the
possibility of an acquisition transaction or change in control event. The Board
further recognizes that such events, and the uncertainties that such events may
create among management, can be a distraction to the Executive and can cause the
Executive to consider or pursue alternative employment opportunities. The Board
believes that it is in the best interests of the Company and its stockholders to
provide the Executive with an incentive to remain with the Company and to
provide the Company with the continued dedication and objectivity of the
Executive notwithstanding the possibility of a Change in Control to maximize the
value of the Company upon a Change in Control for the benefit of its
stockholders.
C.      The Company and the Executive desire this Agreement to be the complete,
final and exclusive agreement between the Company and the Executive relating to
the benefits to which the Executive is entitled upon termination of the
Executive’s employment or upon a Change in Control, and further desire that this
Agreement shall supersede certain provisions of the [Employment Agreement dated
                     between the Company and the Executive (the “Employment
Agreement”)] [offer letter dated                      with the Executive (the
“Offer Letter”)], with regard to the benefits to which the Executive is entitled
upon termination of the Executive’s employment or upon a Change in Control.
D.     To accomplish the foregoing objectives, the Board has directed the
Company, upon execution of this Agreement by the Executive, to agree to the
terms provided herein.
Agreement
          In consideration of the mutual covenants herein contained, and in
consideration of the continuing employment of the Executive by the Company, the
parties agree as follows:
          1.      Term of Agreement. This Agreement shall remain in effect from
the Effective Date until the date when the Company has met all of its
obligations under this Agreement

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following a termination of the Executive’s employment with the Company for a
reason described in Section 4 below.
          2.      Definitions of Terms.
                    (a)      Definition of Cause. For all purposes under this
Agreement, “Cause” shall mean, with respect to the Executive, the occurrence of
one or more of the following events:
                              (i)      acts or omissions deemed by the Board to
constitute gross negligence, recklessness, willful misconduct or dishonesty on
the part of the Executive with respect to the Executive’s obligations under this
Agreement or otherwise relating to the business of the Company;
                              (ii)      the Executive’s willful, material breach
of this Agreement or of the [Employment Agreement] [Offer Letter];
                              (iii)      the Executive’s conviction or entry of
a plea of guilty or nolo contendere for fraud, misappropriation or embezzlement,
or of any felony;
                              (iv)      the Executive’s material breach of
Executive’s fiduciary duty toward the Company;
                              (v)      the Executive’s material breach of any
element of the Company’s Confidential Information and Invention Assignment
Agreement, including without limitation, the Executive’s theft, dilution, or
other misappropriation or careless treatment of the Company’s proprietary
information;
                              (vi)      the Executive’s inability to perform all
of the essential functions and duties of the Executive’s position, with or
without reasonable accommodation other than for reason of temporary illness; or
                              (vii)      the Executive’s death.
                    (b)      Definition of Change in Control. For all purposes
under this Agreement, “Change in Control” shall mean the occurrence of any of
the following events after the date of this Agreement:
                              (i)      any “person” (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (the “Exchange
Act”), other than a trustee or other fiduciary holding securities of the Company
under an employee benefit plan of the Company, becomes the “beneficial owner”
(as defined in Rule 13d-3 promulgated under the Exchange Act), directly or
indirectly, of the securities of the Company representing more than 50% of
(A) the outstanding shares of common stock of the Company or (B) the combined
voting power of the Company’s then-outstanding securities;
                              (ii)      the consummation of the sale or
disposition of all or substantially all of the Company’s assets (or any
transaction having similar effect is consummated) other than to an entity of
which the Company owns at least 50% of the voting stock so long as the sale or
disposition is not under duress of the Company’s financial hardship;

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                              (iii)      the consummation of a merger or
consolidation to which the Company is a party that results in the holders of
voting securities of the Company outstanding immediately prior thereto failing
to continue to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) less than 50% of the combined
voting power of the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or
                              (iv)      individuals who, on the Effective Date,
are members of the Board (the “Incumbent Board”) cease for any reason to
constitute at least a majority of the members of the Board; provided, however,
that if the appointment or election (or nomination for election) of any new
Board member was approved or recommended by a majority vote of the members of
the Incumbent Board then still in office, such new member shall, for purposes of
this Agreement, be considered as a member of the Incumbent Board.
                    (c)      Definition of Good Reason. For all purposes under
this Agreement, “Good Reason” shall mean, with respect to the Executive, the
occurrence of one or more of the following, without the Executive’s express
written consent and for which the Executive has given the Company express
written notice within thirty (30) days following such occurrence (provided that
no advance written notice shall be required in the case of an occurrence
contemplated by Section 2(c)(iv) below):
                              (i)      a material reduction in the Executive’s
duties, title, position, level of authority, reporting relationship or
responsibilities relative to the duties, title, position, authority, reporting
relationship or responsibilities in effect immediately prior to such reduction,
including, without limitation, (A) in the event the Executive is a member of the
Board at the time of a Change in Control, the Executive ceases to serve as a
member of the Board of the ultimate parent corporation that controls the
operations of the Company, (B) in the event the Executive is the most senior
executive in a particular function, in connection with a Change in Control, the
Executive ceases to be the most senior executive in such function, (C) in the
event the Executive performs at the time of a Change in Control external duties
typical in a public company, the Executive ceases to perform such duties or
(D) any other such reduction attributable to the fact that the Company ceases to
be a public company as a result of a Change in Control;
                              (ii)      a reduction in the Executive’s base
salary, bonus or other cash incentive compensation opportunity as in effect
immediately prior to such reduction for any reason other than in connection
with, and proportionate to, a company-wide pay reduction;
                              (iii)      an increase in the Executive’s one-way
driving distance from the Executive’s principal personal residence to the
principal office or business location at which the Executive is required to
perform services of more than 35 miles; or
                              (iv)      an increase in required travel for the
Company’s business to an extent not substantially consistent with the
Executive’s business travel obligations immediately prior to the Change of
Control.
          Notwithstanding the forgoing, “Good Reason” shall not include any of
the foregoing occurrences, and Executive’s resignation shall not be deemed a
resignation for Good Reason as a result of an occurrence if, prior to
Executive’s resignation as a result of an occurrence or occurrences that would
otherwise be included within the definition of “Good Reason”, Executive

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has accepted employment with another company whereby Executive’s duties, title,
position, level of authority, reporting relationship or responsibilities, or
Executive’s base salary, bonus or other cash incentive compensation opportunity,
or Executive’s one-way driving distance or required travel, as the case may be,
is no more favorable to Executive than that in effect at the Company at the time
of such resignation which would otherwise have given rise to a resignation for
Good Reason by Executive (e.g., if Executive accepts employment with another
company for a reduced salary and title (as compared to Executive’s then current
salary and title at the Company) prior to a salary and title reduction at the
Company (which Company reductions would otherwise have been covered by
Sections 2(c)(i) and 2(c)(ii)), then Executive would not be entitled to resign
for Good Reason as a result of such salary or title reduction if the salary and
title at the other company are no more favorable to Executive than Executive’s
reduced salary and title at the Company at the time of Executive’s resignation).
          3.      Acceleration of Vesting Upon a Change in Control. In the event
of a Change in Control, immediately prior to the occurrence of such Change in
Control, the vesting of each Company equity award held by the Executive shall
accelerate (and be released from any repurchase option in favor of the Company,
if applicable) by the number of shares subject to such equity award that would
have otherwise been vested on the date that is twelve (12) months after the
effective date of the Change in Control.
          4.      Compensation Upon Termination.
                    (a)      Compensation Upon Termination For Any Reason. Upon
the Executive’s termination, the Company shall pay the Executive’s base salary
and any accrued and unused vacation benefits earned through the effective date
of termination at the rate in effect at the time of termination, less standard
deductions and withholdings, and the Company shall thereafter have no further
obligations to the Executive under this Agreement other than with respect to a
termination covered by Section 4(c) and/or Section 4(d) hereof.
                    (b)      Effective Release. The Executive shall not receive
any of the severance payments or benefits set forth under Section 4(c) and
Section 4(d) hereof, as applicable, unless the Executive furnishes the Company
with an effective waiver and release of claims (the “Release”) in the form
attached hereto as Exhibit A or in such other form as the Company may reasonably
specify.
                    (c)      Benefits Upon Termination By the Company Without
Cause. Subject to Section 4(b) hereof, in addition to the payment to the
Executive of the amounts owed to the Executive pursuant to Section 4(a) above,
if the Executive’s employment is terminated by the Company without Cause at any
time prior to a Change in Control or more than twelve (12) months after a Change
of Control, the Company shall provide the following benefits:
                              (i)      Commencing on the pay date next following
the Executive’s termination, the Company shall continue to pay the Executive’s
base salary until the end of the period following the termination of the
Executive’s employment equal to twelve (12) months (the “Severance Period”),
subject to acceleration of such payments into a lump-sum cash severance payment
in accordance with Section 4(d)(i)(2) hereof in the event of a Change in Control
within three (3) months after the date of termination of the Executive’s
employment. Such severance payments shall be subject to standard deductions and
withholdings and, unless such payments are accelerated into a lump-sum payment
in accordance with Section 4(d)(i)(2),

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shall be paid on the Company’s regular payroll dates and in accordance with its
regular payroll practices. For purposes of calculating the amount to be paid
pursuant to this Section 4(c)(i), the Company shall use the Executive’s base
compensation in effect on the date of termination. For the avoidance of doubt,
severance payments payable to the Executive if the Executive’s employment is
terminated without Cause upon or within twelve (12) months following a Change of
Control shall be governed by the provisions of Section 4(d)(i)(1) below.
                              (ii)      [[For Mike Grey and Stephen Burley
only]: The vesting of each Company equity award held by the Executive shall
accelerate (and be released from any repurchase option in favor of the Company,
if applicable) on the date of termination of the Executive’s employment by the
number of shares that would have vested had the Executive remained employed by
the Company during the Severance Period.]
                    (d)      Benefits Upon Termination in Connection With a
Change in Control. Subject to Section 4(b) hereof, in addition to the payment to
the Executive of the amounts owed to the Executive pursuant to Sections 4(a) and
4(c) above, if within three (3) months before or twelve (12) months following
the occurrence of a Change in Control, the Company terminates the Executive’s
employment without Cause or the Executive resigns for Good Reason, the Company
shall provide the following additional severance benefits:
                              (i)      Severance.
                                        (1)      Termination without Cause upon
or following a Change in Control; Resignation for Good Reason prior to or
following a Change in Control. If the Company terminates the Executive’s
employment without Cause or the Executive resigns for Good Reason upon or within
twelve (12) months following the occurrence of the Change in Control, then the
Company shall pay to the Executive a lump sum cash severance payment in an
amount equal to [twelve (12)] [twenty-four (24) [for Mike Grey only]] months of
the Executive’s then-current base salary amount within 10 days following the
date of the Executive’s termination. If the Executive resigns for Good Reason
within three (3) months prior to the occurrence of a Change in Control, then the
Company shall pay to the Executive a lump sum cash severance payment in an
amount equal to [twelve (12)] [twenty-four (24) [for Mike Grey only]] months of
the Executive’s then-current base salary amount within 10 days following the
date of the occurrence of the Change in Control. Such lump-sum severance payment
shall be subject to standard deductions and withholdings. For purposes of
calculating the amount to be paid pursuant to this Section 4(d)(i)(1), the
Company shall use the Executive’s base compensation in effect on the date of
termination.
                                        (2)      Termination Without Cause Prior
to a Change in Control. If the Company terminates the Executive’s employment
without Cause within three (3) months prior to the occurrence of a Change in
Control, then commencing on the pay date next following the Executive’s
termination, the Company shall continue to pay the Executive’s base salary until
the end of the period following the termination of the Executive’s employment
equal to [twelve (12)] [twenty-four (24) [for Mike Grey only]] months. Such
severance payments shall be subject to standard deductions and withholdings and
paid on the Company’s regular payroll dates and in accordance with its regular
payroll practices. Such severance payments shall be reduced by the amount of any
severance payments paid to the Executive prior to the Change in Control pursuant
to Section 4(c)(i) hereof (e.g., if the Executive has received two (2) months of
severance payments pursuant to Section 4(c)(i) prior to the Change in Control,
then the

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Executive would be entitled to severance payments equal to [ten (10)][twenty-two
(22) [for Mike Grey only]] months of Executive’s base salary pursuant to this
Section 4(d)(i)(2) in lieu of any remaining severance payment amounts that would
otherwise have been payable pursuant to Section 4(c)(i)). For purposes of
calculating the amount to be paid pursuant to this Section 4(d)(i)(2), the
Company shall use the Executive’s base compensation in effect on the date of
termination. Notwithstanding the foregoing, in the event that the Change in
Control described in this Section 4(d) is a change in the ownership or effective
control of the Company, or in the ownership of a substantial portion of the
assets of the Company, in each case for purposes of Section 409A(a)(2)(A)(v) of
the Internal Revenue Code and the regulations and other guidance thereunder,
then any remaining portion of the aggregate severance payments that has not yet
been paid to the Executive will instead be paid in a single lump-sum payments
within 10 days following such Change in Control.
                              (ii)      Acceleration of Vesting of Equity
Awards. All Company equity awards held by the Executive shall vest in full (and
be released from any repurchase option in favor of the Company, if applicable)
as of the date of the Executive’s termination of employment and the Executive
shall have continued exercisability of each Company stock option held by the
Executive (if any) for [twelve (12)][fifteen (15) [for Mike Grey only]] months;
provided, however, that for stock options granted prior to the Effective Date,
if the Company determines that such continued stock option exercisability would
cause such stock option to be treated as covered by Section 409A of the Code or
would cause the Executive to become subject to the immediate taxation prior to
the date of exercise, additional tax and interest under Section 409A of the
Code, then any such stock option then held by the Executive shall remain
exercisable only until the earlier of (1) the date [twelve (12)][fifteen (15)
[for Mike Grey only]] months after the date of termination, or (2) the later of
the 15th day of the third month following the date at which, or December 31 of
the calendar year in which, the stock option would otherwise have expired if the
stock option had not been extended pursuant to this Section 4(d)(ii) (based on
the terms of the stock option at the original grant date); provided, however,
that such stock options shall not be exercisable after the expiration of its
maximum term.
                              (iii)      Bonus. The Executive shall receive a
lump-sum cash payment in an amount equal to the Executive’s full target bonus
amount for services to be performed during the year in which the Change in
Control occurs, less standard deductions and withholdings. The lump-sum payment
contemplated by this Section 4(d)(iii) shall be made on the date that is the
later of (x) 10 days following the date of the Executive’s termination or
(y) 10 days following the occurrence of such Change in Control.
                              (iv)      Benefits. Assuming the Executive timely
and accurately elects to continue his or health insurance benefits under the
Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the Company
shall pay the COBRA premiums for the Executive and his or her qualified
beneficiaries until the earliest of (i) the end of the period following the
termination of the Executive’s employment equal to twelve (12) months, (ii) the
expiration of the Executive’s continuation coverage under COBRA and any
applicable state COBRA-like statute that provides mandated continuation coverage
or (iii) the date the Executive becomes eligible for health insurance benefits
provided through a subsequent employer.
                              (v)      Indemnification. The Executive shall
continue to be entitled, for any period that the Executive served as an officer
or director of the Company, and effective until

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the expiration of all applicable statute of limitations periods, to (i) all
indemnification rights provided under any indemnification agreements between the
Executive and the Company or provided by the Company’s certificate of
incorporation and bylaws or otherwise in effect at the time of the Executive’s
termination of employment and (ii) coverage under any officers’ and directors’
liability insurance policy in effect at the time of the Executive’s termination
of employment.
          5.      Section 409A of the Internal Revenue Code and Specified
Employees. If the Company determines that any of the severance benefits payable
to the Executive pursuant to Section 4 fail to satisfy the distribution
requirement of Section 409A(a)(2)(A) of the Internal Revenue Code as a result of
Section 409A(a)(2)(B)(i) of the Internal Revenue Code which applies to specified
employees of publicly traded companies, the payment of such benefit shall be
accelerated to the minimum extent necessary so that the benefit is not subject
to the provisions of Section 409A(a)(1) of the Internal Revenue Code. (It is the
intention of the preceding sentence to apply the short-term deferral provisions
of Section 409A of the Internal Revenue Code, and the regulations and other
guidance thereunder, to the severance benefits payments, and the payment
schedule as revised after the application of the preceding sentence shall be
referred to as the “Revised Payment Schedule.”) However, if there is no Revised
Payment Schedule that would avoid the application of Section 409A(a)(1) of the
Internal Revenue Code, the payment of such benefits shall not be paid pursuant
to a Revised Payment Schedule and instead shall be delayed to the minimum extent
necessary (e.g., payments to which the Executive would otherwise be entitled
during the first six months following separation from service shall accumulate
and be paid at the expiration of such period, unless a permitted distribution
event occurs during such period) so that such benefits are not subject to the
provisions of Section 409A(a)(1) of the Internal Revenue Code. The Board may
attach conditions to or adjust the amounts paid pursuant to Section 4 to
preserve, as closely as possible, the economic consequences that would have
applied in the absence of this Section 5; provided, however, that no such
condition or adjustment shall result in the payments being subject to
Section 409A(a)(1) of the Internal Revenue Code.
          6.      Parachute Payments.
                    (a)      If any payment or benefit the Executive would
receive pursuant to a Change in Control or otherwise (“Payment”) would
(i) constitute a “parachute payment” within the meaning of Section 280G of the
Internal Revenue Code, and (ii) but for this sentence, be subject to the excise
tax imposed by Section 4999 of the Internal Revenue Code (the “Excise Tax”),
then such Payment shall be reduced 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 Executive’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 Executive elects in writing a different order (provided, however, that such
election shall be subject to Company approval if made on or after the effective
date of the event that triggers the Payment): reduction of cash payments;
cancellation of accelerated vesting

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of stock awards; reduction of employee benefits. In the event that 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
Executive’s stock awards unless the Executive elects in writing a different
order for cancellation.
                    (b)      The accounting firm engaged by the Company for
general audit purposes as of the day prior to the effective date of the Change
in 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 in Control, then 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.
                    (c)      The accounting firm engaged to make the
determinations hereunder shall provide its calculations, together with detailed
supporting documentation, to the Executive and the Company within fifteen
(15) calendar days after the date on which the Executive’s right to a Payment is
triggered (if requested at that time by the Executive or the Company) or such
other time as requested by the Executive or the Company. 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
Executive and the Company with an opinion reasonably acceptable to the 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 Executive and the Company.
          7.      Successors.
                    (a)      Company’s Successors. The Company shall require any
successor (whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company’s business and/or assets, by an agreement in substance and form
satisfactory to the Executive, to assume this Agreement and to agree expressly
to perform this Agreement in the same manner and to the same extent as the
Company would be required to perform it in the absence of a succession. For all
purposes under this Agreement, the term “Company” shall include any successor to
the Company’s business and/or assets which executes and delivers the assumption
agreement described in this Section 7(a) or which becomes bound by this
Agreement by operation of law. This Agreement shall be binding upon and inure to
the benefit of the Company and its successors, assigns and legal
representatives.
                    (b)      Executive’s Successors. This Agreement and all
rights of the Executive hereunder shall inure to the benefit of, and be
enforceable by, the Executive’s personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. Because
of the unique and personal nature of the Executive’s duties under this
Agreement, neither this Agreement nor any rights or obligations under this
Agreement shall be assignable by the Executive.
          8.      Miscellaneous Provisions.
                    (a)      Notice. Notices and all other communications
contemplated by this Agreement shall be in writing and shall be deemed to have
been duly given when personally

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delivered or when mailed by U.S, registered or certified mail, return receipt
requested and postage prepaid. In the case of the Executive, mailed notices
shall be addressed to him at the home address which he most recently
communicated to the Company in writing. In the case of the Company, mailed
notices shall be addressed to its corporate headquarters, and all notices shall
be directed to the attention of its Secretary.
                    (b)      Waiver; Modification. No provision of this
Agreement shall be modified, waived or discharged unless the modification,
waiver or discharge is agreed to in writing and signed by the Executive and by
an authorized officer of the Company (other than the Executive). No waiver by
either party of any breach of, or of compliance with, any condition or provision
of this Agreement by the other party shall be considered a waiver of any other
condition or provision or of the same condition or provision at another time.
                    (c)      Interpretation; Construction. The headings set
forth in this Agreement are for convenience of reference only and shall not be
used in interpreting this Agreement. The Executive has been encouraged to
consult with, and has consulted with, the Executive’s own independent counsel
and tax advisors with respect to the terms of this Agreement. The Company and
the Executive acknowledge that each party and its counsel has reviewed and
revised, or had an opportunity to review and revise, this Agreement, and any
rule of construction to the effect that any ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation of this
Agreement.
                    (d)      Integration. This Agreement, including Exhibit A
contains the complete, final and exclusive agreement of the Company and the
Executive relating to the to the benefits to which the Executive is entitled
upon termination of the Executive’s employment or upon a Change in Control, and
supersedes all prior and contemporaneous oral and written employment agreements
or arrangements between the Company and the Executive with regard to the
benefits to which the Executive is entitled upon termination of the Executive’s
employment or upon a Change in Control, including without limitation [sections
[                    ] of the [Employment Agreement] [the change in control [and
severance] provisions of the Offer Letter]. No agreements, representations or
understandings (whether oral or written and whether express or implied) which
are not expressly set forth in this Agreement have been made or entered into by
either party with respect to the subject matter hereof.
                    (e)      Withholding Taxes. All payments made under this
Agreement shall be subject to reduction to reflect taxes required to be withheld
by law.
                    (f)      Choice of Law. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws of
the State of California.
                    (g)      Severability. The invalidity or unenforceability of
any provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in full force
and effect.
                    (h)      At-Will Employment. The Executive acknowledges and
agrees that the Executive’s employment with the Company is “at will,” and
subject to the provisions of this Agreement, may be terminated at any time and
for any reason whatsoever by the Executive or the Company, with or without Cause
and with or without advance notice. This “at-will”

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employment relationship cannot be changed except in a writing signed by the
Chairman of the Board or other authorized designee of the Board.
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          In Witness Whereof, each of the parties has executed this Agreement,
in the case of the Company by its duly authorized officer, as of the day and
year first above written.

         
 
       
 
                  [Executive]
 
            SGX Pharmaceuticals, Inc.
 
       
 
  By    
 
         
 
  Title    
 
       

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EXHIBIT A
RELEASE AND WAIVER OF CLAIMS
[To be signed and delivered following termination]
          In consideration of the payments and other benefits to be provided
pursuant to the Change In Control Severance Agreement dated [DATE], to which
this form is attached (the “Agreement”), I, [NAME], hereby furnish SGX
Pharmaceuticals, Inc. (the “Company”), with the following release and waiver
(“Release and Waiver”).
          I hereby generally and completely release and forever discharge the
Company and its directors, officers, executives, shareholders, partners, agents,
attorneys, predecessors, successors, parent and subsidiary entities, insurers,
affiliates, and assigns from any and all claims, liabilities, demands, causes of
action, costs, expenses, attorneys’ fees, damages, indemnities and obligations
of every kind and nature, in law, equity or otherwise, known and unknown,
suspected and unsuspected, disclosed and undisclosed, that arise out of or are
in any way related to events, acts, conduct, or omissions occurring prior to my
signing this Release and Waiver. 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 wages, 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 but not limited to 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 also 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/her]
favor at the time of executing the release, which if known by him must have
materially affected [his/her] 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 any claims I may have against
the Company.
          I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA, and that the consideration given for
the waiver and release in this Agreement is in addition to anything of value to
which I was already entitled. I further acknowledge that I have been advised by
this writing that: (a) this waiver and release do not apply to any rights or
claims that may arise after the execution date of this Agreement; (b) I should
consult with an attorney prior to executing this Release and Waiver; (c) I have
twenty-one (21) days to consider this Release and Waiver (although I may choose
to voluntarily execute this Release and Waiver earlier); (d) I have seven
(7) days following the execution of this Release

 

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and Waiver by the parties to revoke the Release and Waiver; and (e) this Release
and Waiver will not be effective until the date upon which the revocation period
has expired, which will be the eighth day after the date I execute this Release
and Waiver. No payment will be made to me until this Release and Waiver has
become effective.

             
Date:
           
 
           
 
          [Executive]