**AMENDED
      AND RESTATED**


**EXECUTIVE
      SEVERANCE BENEFITS AGREEMENT**





This
      **AMENDED AND RESTATED EXECUTIVE SEVERANCE BENEFITS AGREEMENT** (the
      “ ***Agreement*** ”)
      is
      entered into this 22nd day of May, 2008 (the “ ***Effective
      Date*** ”),
      between **VALERIE L. PIERCE** (“ ***Executive*** ”)
      and
**SUNESIS PHARMACEUTICALS, INC** **.** (the
      “ ***Company*** ”).
      This
      Agreement is intended to provide Executive with the compensation and benefits
      described herein upon the occurrence of specific events. Certain capitalized
      terms used in this Agreement are defined in Article 6.




**WHEREAS** , the
      Company and the
      Executive previously entered into an Executive Severance Benefits Agreement,
      dated May 14, 2007 (the “Prior Benefits Agreement”); and




**WHEREAS** ,
      the
      Company and the Executive wish to amend and restate the Prior Benefits Agreement
      by entering into this Amended and Restated Executive Severance Benefits
      Agreement to clarify certain matters previously agreed to by the parties and
      to
      comply with the parties’ original intent that the Prior Benefits
      Agreement be
      interpreted, construed and administered in a manner that satisfies Section
      409A of the Internal Revenue Code of 1986, as amended from time to time, among
      other things.




**NOW,
      THEREFORE** ,
      in
      consideration of the foregoing, the Company and the Executive, intending to
      be
      legally bound, hereby amend and restate the Prior Benefits Agreement
      and agree as
      follows:




**ARTICLE
      1**




**SCOPE
      OF AND CONSIDERATION FOR THIS AGREEMENT**




**1.1**  **Position
      and Duties.** Executive is currently employed by the Company as Senior Vice President, General
      Counsel and Corporate Secretary. Executive has overall responsibility for the
      Company’s corporate legal functions, including but not limited to, service as
      Secretary of the Board and Corporate Secretary. Executive reports directly
      to
      the Chief Executive Officer.




**1.2**  **Restrictions.** During
      her employment by the Company, Executive agrees to the best of her ability
      and
      experience that she will at all times loyally and conscientiously perform all
      of
      the duties and obligations required of and from her as Senior Vice President
      and
      General Counsel. During the term of her employment, Executive further agrees
      that she will devote all of her business time and attention to the business
      of
      the Company, the Company will be entitled to all of the benefits and profits
      arising from or incident to all such work, services and advice, Executive will
      not render commercial or professional services of any nature to any person
      or
      organization, whether or not for compensation, without the prior written consent
      of the Board, and Executive will not directly or indirectly engage or
      participate in any business that is competitive in any manner with the business
      of the Company. Nothing in this Agreement will prevent Executive from accepting
      speaking or presentation engagements in exchange for honoraria or from service
      on boards of charitable organizations or otherwise participating in civic,
      charitable or fraternal organizations, or from owning no more than one percent
      (1%) of the outstanding equity securities of a corporation whose stock is listed
      on a national stock exchange. It is contemplated that Executive may serve on
      boards of directors of other, non-competitive companies and the Board will
      not
      unreasonably withhold its consent from such participation. Such participation
      shall not exceed the greater of six (6) days per year or such number of days
      as
      is required for Executive to serve on the board of directors of one (1) such
      company.




1.




**1.3**  **Professional
      Requirements.** The
      Company shall pay the costs of Executive’s State Bar dues, her required
      Continuing Legal Education courses and those professional education programs
      reasonably necessary for the performance of Executive’s duties as Senior Vice
      President and General Counsel. Executive’s participation in such programs will
      be considered work time and the travel expenses associated with attendance
      at
      such conferences will be paid according to the Company’s expense reimbursement
      policies.




**1.4**  **Confidential
      Information and Invention Assignment Agreement.** Executive acknowledges that she has previously executed and delivered to an
      officer of the Company the Company’s Confidential Information and Invention
      Assignment Agreement (the “ ***Confidentiality
      Agreement*** ”)
      and
      that the Confidentiality Agreement remains in full force and
      effect.




**1.5**  **Confidentiality
      of Terms.** Executive agrees to follow the Company’s strict policy that employees must not
      disclose, either directly or indirectly, any information, including any of
      the
      terms of this Agreement, regarding salary, bonuses, or stock purchase or option
      allocations to any person, including other employees of the Company; *provided,
      however* ,
      that
      Executive may discuss such terms with members of her immediate family and any
      legal, tax or accounting specialists who provide Executive with individual
      legal, tax or accounting advice, with third parties as needed to enforce the
      terms of this Agreement, with other employees of the Company on a need to know
      basis if required to carry out Executive’s duties as the Company’s Senior Vice
      President and General Counsel or at the request of the Board or any other
      superior officer of the Company.




**1.6**  **Benefits
      Upon Change of Control.** The
      Company and Executive wish to set forth the compensation and benefits which
      Executive shall be entitled to receive in the event of a Change of Control
      or if
      Executive’s employment with the Company is terminated under the circumstances
      described herein.




**1.7**  **Consideration.** The
      duties and obligations of the Company to Executive under this Agreement shall
      be
      in consideration for Executive’s past services to the Company, Executive’s
      continued employment with the Company, and Executive’s execution of a release in
      accordance with Section 4.1.




**ARTICLE
      2**




**OPTION
      ACCELERATION**




**2.1**  **Change
      of Control Option Acceleration.** In the
      event of a Change of Control, the vesting and/or exercisability of fifty percent
      (50%) of Executive’s then-outstanding Stock Awards shall be automatically
      accelerated immediately prior to the effective date of such Change of
      Control.




2.




**2.2**  **Constructive
      Termination Option Acceleration.**




**(a)**  In
      the
      event of a Covered Termination of Executive’s employment prior to or more than
      twelve (12) months following the effective date of a Change of Control, the
      vesting and/or exercisability of each of Executive’s then-outstanding Stock
      Awards shall be automatically accelerated on the date of termination as to
      the
      number of Stock Awards that would vest in the ordinary course over the twelve
      (12) month period following the date of termination had Executive remained
      continuously employed by the Company during such period.




**(b)**  In
      the
      event of a Covered Termination of Executive’s employment on or within twelve
      (12) months following the effective date of a Change of Control, the vesting
      and/or exercisability of one hundred percent (100%) of Executive’s
      then-outstanding Stock Awards shall be automatically accelerated on the date
      of
      termination.




**2.3**  **Outstanding
      Stock Awards.** For the
      avoidance of doubt, the fifty percent (50%), twelve (12) month and one hundred
      percent (100%) accelerated vesting described in Sections 2.1 and 2.2 shall
      apply
      toward that portion of Executive’s outstanding Stock Awards that are unvested as
      of the date of accelerated vesting.




**ARTICLE
      3**




**SEVERANCE
      BENEFITS**




**3.1**  **Severance
      Benefits.** A
      Covered Termination of Executive’s employment prior to or more than twelve (12)
      months following the effective date of a Change of Control entitles Executive
      to
      receive the benefits set forth in this Section 3.1.




**(a)**  **Base
      Salary.** The
      Company shall pay to Executive an amount equal to nine (9) months’ Base Salary.
      Such severance amount shall be paid in cash in a single lump sum within thirty
      (30) days following the Covered Termination, subject to Sections 4.1 and 4.3
      below, and shall be subject to all required tax withholding.




**(b)**  **Health
      Benefits.** Provided
      that Executive elects continued coverage under the Consolidated Omnibus Budget
      Reconciliation Act of 1985, as amended (together with any state or local laws
      of
      similar effect, “ ***COBRA*** ”),
      the
      Company shall pay the premiums of Executive’s group health insurance coverage,
      including coverage for Executive’s eligible dependents, for a maximum period of
      nine (9) months following such Covered Termination or such lesser number of
      months as Executive and Executive’s eligible dependents are eligible for such
      coverage; *provided,
      however* ,
      that
      the Company shall pay premiums for Executive and Executive’s eligible dependents
      only for coverage for which they were enrolled immediately prior to the Covered
      Termination. Executive (and Executive’s eligible dependents, as applicable)
      shall be solely responsible for making a timely and accurate election for
      continuation of coverage pursuant to COBRA. No premium payments will be made
      following the effective date of Executive’s coverage by a health insurance plan
      of a subsequent employer. For the balance of the period that Executive and
      Executive’s eligible dependents are entitled to coverage under COBRA, if any,
      Executive shall maintain such coverage at Executive’s own expense.




3.




**3.2**  **Change
      of Control Severance Benefits.** A
      Covered Termination of Executive’s employment on or within twelve (12) months
      following the effective date of a Change of Control entitles Executive to
      receive the benefits set forth in this Section 3.2.




**(a)**  **Base
      Salary.** The
      Company shall pay to Executive an amount equal to fourteen (14) months’ Base
      Salary. Such severance amount shall be paid in cash in a single lump sum within
      thirty (30) days following the Covered Termination, subject to Sections 4.1
      and
      4.3 below, and shall be subject to all required tax withholding.




**(b)**  **Bonus.** The
      Company shall pay to Executive an amount equal to fourteen twelfths (14/12ths)
      of Executive’s target annual bonus for the fiscal year during which the Covered
      Termination occurs, with such bonus determined assuming that all of the
      performance objectives for such fiscal year have been attained at target levels.
      Such severance amount shall be paid in cash in a single lump sum within thirty
      (30) days following the Covered Termination, subject to Sections 4.1 and 4.3
      below, and shall be subject to all required tax withholding.




**(c)**  **Health
      Benefits.** Provided
      that Executive elects continued coverage under COBRA, the Company shall pay
      the
      premiums of Executive’s group health insurance coverage, including coverage for
      Executive’s eligible dependents, for a maximum period of fourteen (14) months
      following such Covered Termination or such lesser number of months as Executive
      and Executive’s eligible dependents are eligible for such coverage; *provided,
      however* ,
      that
      the Company shall pay premiums for Executive and Executive’s eligible dependents
      only for coverage for which they were enrolled immediately prior to the Covered
      Termination. Executive (and Executive’s eligible dependents, as applicable)
      shall be solely responsible for making a timely and accurate election for
      continuation of coverage pursuant to COBRA. No premium payments will be made
      following the effective date of Executive’s coverage by a health insurance plan
      of a subsequent employer. For the balance of the period that Executive and
      Executive’s eligible dependents are entitled to coverage under COBRA, if any,
      Executive shall maintain such coverage at Executive’s own expense.




**(d)**  **No
      Duplication of Benefits.** The
      payments and benefits provided for in this Section 3.2 shall only be payable
      in
      the event of a Covered Termination of Executive’s employment on or within twelve
      (12) months following the effective date of a Change of Control. In the event
      of
      a Covered Termination of Executive’s employment prior to or more than twelve
      (12) months following a Change of Control, then Executive shall receive the
      payments and benefits described in Section 3.1 and shall not be eligible to
      receive any of the payments and benefits described in this Section
      3.2.




**3.3**  **Other
      Terminations.** If
      Executive’s employment is terminated by the Company for Cause, by Executive
      other than pursuant to a Constructive Termination or as a result of Executive’s
      death or disability, the Company shall not have any other or further obligations
      to Executive under this Agreement (including any financial obligations) except
      that Executive shall be entitled to receive (a) Executive’s fully earned but
      unpaid base salary, through the date of termination at the rate then in effect,
      and (b) all other amounts or benefits to which Executive is entitled under
      any
      compensation, retirement or benefit plan or practice of the Company at the
      time
      of termination in accordance with the terms of such plans or practices,
      including, without limitation, any eligibility for continuation of benefits
      required by COBRA. In addition, subject to the provisions of the Company’s
      equity compensation plans and the terms of Executive’s Stock Awards, if
      Executive’s employment is terminated by the Company for Cause, by Executive
      other than pursuant to a Constructive Termination or as a result of Executive’s
      death or disability, all vesting of Executive’s unvested Stock Awards previously
      granted to her by the Company shall cease as of the date of termination and
      none
      of such unvested Stock Awards shall be exercisable following the date of such
      termination. The foregoing shall be in addition to, and not in lieu of, any
      and
      all other rights and remedies which may be available to the Company under the
      circumstances, whether at law or in equity.




4.




**3.4**  **Mitigation.** Except
      as otherwise specifically provided herein, Executive shall not be required
      to
      mitigate damages or the amount of any payment provided under this Agreement
      by
      seeking other employment or otherwise, nor shall the amount of any payment
      provided for under this Agreement be reduced by any compensation earned by
      Executive as a result of employment by another employer or by any retirement
      benefits received by Executive after the date of the Covered
      Termination.




**3.5**  **Exclusive
      Remedy.** Except
      as otherwise expressly required by law (e.g., COBRA) or as specifically provided
      herein, all of Executive’s rights to salary, severance, benefits, bonuses and
      other amounts hereunder (if any) accruing after the termination of Executive’s
      employment shall cease upon such termination. In the event of a termination
      of
      Executive’s employment with the Company, Executive’s sole remedy shall be to
      receive the payments and benefits described in this Agreement.




**ARTICLE
      4**




**LIMITATIONS
      AND CONDITIONS UPON BENEFITS**




**4.1**  **Release
      Prior to Payment of Benefits.** Upon the
      occurrence of a Covered Termination of Executive’s employment, and prior to the
      payment of any benefits under this Agreement on account of such Covered
      Termination, Executive shall execute a release (the “Release”) in the form
      attached hereto and incorporated herein as Exhibit A or Exhibit B, as
      applicable. Such Release shall specifically relate to all of Executive’s rights
      and claims in existence at the time of such execution and shall confirm
      Executive’s obligations under the Confidentiality Agreement. It is understood
      that, as specified in the applicable Release, Executive has a certain number
      of
      calendar days to consider whether to execute such Release, and Executive may
      revoke such Release within seven (7) calendar days after execution. In the
      event
      Executive does not execute such Release within the applicable period, or if
      Executive revokes such Release within the subsequent seven (7) day period,
      no
      benefits shall be payable under this Agreement. Notwithstanding
      the payment schedules set forth in Article 3 above, no payments or benefits
      will
      be made prior to the effective date of the Release. On the first regular payroll
      pay day following the effective date of the Release (or such earlier day after
      the effective date of the Release in the Company’s sole discretion), the Company
      will pay the Executive the payments and benefits the Executive would otherwise
      have received on or prior to such date but for the delay in payment related
      to
      the effectiveness of the Release, with the balance of the payments and benefits
      being paid as originally scheduled.




5.




**4.2**  **Termination
      of Benefits.** Benefits
      under this Agreement shall terminate immediately if the Executive, at any time,
      violates any proprietary information or confidentiality obligation to the
      Company, including, without limitation, the Confidentiality
      Agreement.




**4.3**  **Compliance
      with Section 409A** .
      It is
      intended that each installment of the payments and benefits provided for in
      Articles 2 and 3 is a separate “payment” for purposes of Treasury Regulation
      Section 1.409A-2(b)(2)(i). For the avoidance of doubt, it is intended that
      payments of the amounts set forth in Articles 2 and 3 satisfy, to the greatest
      extent possible, the exemptions from the application of Section 409A of the
      Code
      (together, with any state law of similar effect, “ ***Section
      409A*** ”)
      provided under Treasury Regulations 1.409A-1(b)(4), 1.409A-1(b)(5) and
      1.409A-1(b)(9). However, if the Company (or, if applicable, the successor entity
      thereto) determines that the payments and benefits provided under this Agreement
      (the “ ***Agreement
      Payments*** ”)
      constitute “deferred compensation” under Section 409A and Executive is a
“specified employee” of the Company or any successor entity thereto, as such
      term is defined in Section 409A(a)(2)(B)(i) of the Code (a “ ***Specified
      Employee*** ”),
      then,
      solely to the
      extent necessary to
      avoid
      the incurrence of the adverse personal tax consequences under Section 409A,
      the
      timing of the Agreement Payments shall be delayed as follows: on the earlier
      to
      occur of (i) the date that is six months and one day after Executive’s
“separation from service” (as defined under Section 409A) or (ii) the date of
      Executive’s death (such earlier date, the “ ***Delayed
      Initial Payment Date*** ”),
      the
      Company (or the successor entity thereto, as applicable) shall (A) pay to the
      Executive a lump sum amount equal to the sum of the Agreement Payments that
      the
      Executive would otherwise have received through the Delayed Initial Payment
      Date
      if the commencement of the payment of the Agreement Payments had not been so
      delayed and (B) commence paying the balance of the Agreement Payments in
      accordance with the applicable payment schedules set forth in this
      Agreement.




**ARTICLE
      5**




**PARACHUTE
      PAYMENTS**




**5.1**  **Best
      Pay Provision.** Anything
      in this Agreement to the contrary notwithstanding, in the event it shall be
      determined that any Payment under this Agreement would, when combined with
      all
      other Payments Executive receives from the Company or any successor or parent
      or
      subsidiary thereof, but for this Article 5, be subject to the Excise Tax, then
      such Payments shall be either (a) the full amount of such Payments or (b) such
      lesser amount as would result in no portion of the Payments being subject to
      the
      Excise Tax, whichever of the foregoing amounts, taking into account the
      applicable federal, state and local employment taxes, income taxes and the
      Excise Tax, results in Executive’s receipt, on an after-tax basis, of the
      greater amount of the Payments notwithstanding that all or some portion of
      the
      Payments may be subject to the Excise Tax. If
      a
      reduced amount is to be paid, (i) the Executive shall have no rights to any
      additional payments and/or benefits constituting the Payments, and (ii)
      reduction in payments and/or benefits shall occur in the following order: (1)
      reduction of other cash payments (if any); (2) cancellation of accelerated
      vesting of equity awards other than stock options; (3) cancellation of
      accelerated vesting of stock options; and (4) reduction of other benefits (if
      any) paid to the Executive. In the event that acceleration of compensation
      from
      the Executive’s equity awards is to be reduced, such acceleration of vesting
      shall be canceled in the reverse order of the date of grant.




6.




**5.2**  **Determinations.** All
      determinations required to be made under this Article 5, including whether
      and
      to what extent the Payments shall be reduced and the assumptions to be utilized
      in arriving at such determination, shall be made by the nationally recognized
      certified public accounting firm used by the Company immediately prior to the
      Change of Control or, if such firm declines to serve, such other nationally
      recognized certified public accounting firm as may be designated by the
      Executive (the “Accounting Firm”). The Accounting Firm shall provide detailed
      supporting calculations both to the Company and the Executive at such time
      as is
      requested by the Company. All fees and expenses of the Accounting Firm shall
      be
      borne solely by the Company. Any determination by the Accounting Firm shall
      be
      binding upon the Company and the Executive. For purposes of making the
      calculations required by this Article 5, the Accounting Firm may make reasonable
      assumptions and approximations concerning applicable taxes and may rely on
      reasonable, good-faith interpretations concerning the application of Sections
      280G and 4999 of the Code.




**ARTICLE
      6**




**DEFINITIONS**




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




**6.1**  “ ***Base
      Salary*** ”
means
      Executive’s annual base salary as in effect during the last regularly scheduled
      payroll period immediately preceding the Covered Termination (or,
      in
      the case of a Covered Termination arising from Constructive Termination, the
      annual base salary as in effect immediately prior to the event that gives rise
      to a right to resign as a Constructive Termination) .




**6.2**  “ ***Board*** ”
means
      the Board of Directors of the Company.




**6.3**  “ ***Cause*** ”
means
      that, in the reasonable determination of the Company, Executive:




**(a)**  has
      committed an act of fraud or embezzlement or has intentionally committed some
      other illegal act that has a material adverse impact on the Company or any
      successor or parent or subsidiary thereof;




**(b)**  has
      been
      convicted of, or entered a plea of “guilty” or “no contest” to, a felony which
      causes or may reasonably be expected to cause substantial economic injury to
      or
      substantial injury to the reputation of the Company or any subsidiary or
      affiliate of the Company;




**(c)**  has
      made
      any unauthorized use or disclosure of confidential information or trade secrets
      of the Company or any successor or parent or subsidiary thereof that has a
      material adverse impact on any such entity;




**(d)**  has
      committed any other intentional misconduct that has a material adverse impact
      on
      the Company or any successor or parent or subsidiary thereof;




7.




**(e)**  has
      intentionally refused or intentionally failed to act in accordance with any
      lawful and proper direction or order of the Board or the appropriate individual
      to whom Executive reports; provided such direction is not materially
      inconsistent with the Executive’s customary duties and responsibilities;
      or




**(f)**  has
      ceased to be certified by the Committee of Bar Examiners of the State of
      California to practice law in the State of California.




**6.4**  “ ***Change
      of Control*** ”
means
      and includes each of the following:




**(a)**  the
      acquisition, directly or indirectly, by any “person” or “group” (as those terms
      are defined in Sections 3(a)(9), 13(d) and 14(d) of the Securities Exchange
      Act
      of 1934, as amended, and the rules thereunder) of “beneficial ownership” (as
      determined pursuant to Rule 13d-3 under the Securities Exchange Act of
      1934, as amended) of securities entitled to vote generally in the election
      of
      directors (“ ***voting
      securities*** ”)
      of the
      Company that represent fifty percent (50%) or more of the combined voting power
      of the Company’s then outstanding voting securities, other than:




**(i)**  an
      acquisition by a trustee or other fiduciary holding securities under any
      employee benefit plan (or related trust) sponsored or maintained by the Company
      or any person controlled by the Company or by any employee benefit plan (or
      related trust) sponsored or maintained by the Company or any person controlled
      by the Company, or




**(ii)**  an
      acquisition of voting securities by the Company or a corporation owned, directly
      or indirectly by the stockholders of the Company in substantially the same
      proportions as their ownership of the stock of the Company;




Notwithstanding
      the foregoing, the following event shall not constitute an “acquisition” by any
      person or group for purposes of this Section: an acquisition of the Company’s
      securities by the Company that causes the Company’s voting securities
      beneficially owned by a person or group to represent fifty percent (50%) or
      more
      of the combined voting power of the Company’s then outstanding voting
      securities; *provided,
      however* ,
      that if
      a person or group shall become the beneficial owner of fifty percent (50%)
      or
      more of the combined voting power of the Company’s then outstanding voting
      securities by reason of share acquisitions by the Company as described above
      and
      shall, after such share acquisitions by the Company, become the beneficial
      owner
      of any additional voting securities of the Company, then such acquisition shall
      constitute a Change of Control; or




**(b)**  the
      consummation by the Company (whether directly involving the Company or
      indirectly involving the Company through one or more intermediaries) of (x)
      a
      merger, consolidation, reorganization, or business combination or (y) a sale
      or
      other disposition of all or substantially all of the Company’s assets or (z) the
      acquisition of assets or stock of another entity, in each case other than a
      transaction:




**(i)**  which
      results in the Company’s voting securities outstanding immediately before the
      transaction continuing to represent (either by remaining outstanding or by
      being
      converted into voting securities of the Company or the person that, as a result
      of the transaction, controls, directly or indirectly, the Company or owns,
      directly or indirectly, all or substantially all of the Company’s assets or
      otherwise succeeds to the business of the Company (the Company or such person,
      the “ ***Successor
      Entity*** ”))
      directly or indirectly, at least a majority of the combined voting power of
      the
      Successor Entity’s outstanding voting securities immediately after the
      transaction, and




8.




**(ii)**  after
      which no person or group beneficially owns voting securities representing fifty
      percent (50%) or more of the combined voting power of the Successor Entity; *provided,
      however* ,
      that no
      person or group shall be treated for purposes of this clause (ii) as
      beneficially owning fifty percent (50%) or more of combined voting power of
      the
      Successor Entity solely as a result of the voting power held in the Company
      prior to the consummation of the transaction; or




**(c)**  the
      Company’s stockholders approve a liquidation or dissolution of the
      Company.




Notwithstanding
      the foregoing, a transaction shall not constitute a Change of Control if: (i)
      it
      constitutes the Company’s initial public offering of its securities; or (ii) it
      is a transaction effected primarily for the purpose of financing the Company
      with cash (as determined by the Board in its discretion and without regard
      to
      whether such transaction is effectuated by a merger, equity financing or
      otherwise). The Board shall have full and final authority, which shall be
      exercised in its discretion, to determine conclusively whether a Change of
      Control of the Company has occurred pursuant to the above definition, and the
      date of the occurrence of such Change of Control and any incidental matters
      relating thereto.




**6.5**  “ ***Code*** ”
means
      the Internal Revenue Code of 1986, as amended from time to time and the Treasury
      Regulations thereunder.




**6.6**  “ ***Company*** ”
means
      Sunesis Pharmaceuticals, Inc. or, following a Change of Control, the surviving
      entity resulting from such transaction.




**6.7**  “ ***Constructive
      Termination*** ”
means
      that Executive voluntarily terminates employment with the Company (or any
      successor thereto) if and only if:




**(a)**  one
      of
      the following actions have been taken without
      Executive’s express written consent:




**(i)**  there
      is
      a material diminution in the authority, duties or responsibilities of Executive,
      or the assignment to Executive of duties that are materially inconsistent with
      and materially adverse to Executive’s position;




**(ii)**  a
      change
      in the Executive’s direct reporting relationship so that Executive no longer
      reports directly to the Company’s (or its successor’s) most senior executive
      officer;




**(iii)**  there
      is
      a material reduction in Executive’s Base Salary (which the parties agree is a
      reduction of 5% or more), unless the base salaries of all other executives
      are
      similarly reduced (but in no event by an amount more than 10%
      each);




**(iv)**  there
      is
      a material reduction in Executive’s target bonus on or within twelve (12) months
      following the effective date of a Change of Control (which the parties agree
      is
      a reduction of 20% or more of the target bonus, and which the parties agree
      is a
      material breach of the terms of Executive’s employment with the Company), unless
      the target bonuses of all other executives are similarly reduced (but in no
      event by an amount more than 40% each);




9.




**(v)**  Executive
      is required to relocate Executive’s principal place of employment to a facility
      or location that would increase Executive’s one way commute distance by more
      than thirty (30) miles from such Executive’s place of employment immediately
      prior to such change;




**(vi)**  t he
      Company materially breaches its obligations under this Agreement or any
      then-effective written employment agreement with Executive; or




**(vii)**  any
      acquirer, successor or assignee of the Company materially fails to assume and
      perform, in all material respects, the obligations of the Company hereunder;
      and




**(b)**  Executive
      provides written notice to the Company’s Chief Executive Officer within the
      ninety (90)-day period immediately following such action; and




**(c)**  such
      action is not remedied by the Company within thirty (30) days following the
      Company’s receipt of such written notice; and




**(d)**  Executive’s
      resignation is effective not later than sixty (60) days after the expiration
      of
      such thirty (30) day cure period.




The
      termination of Executive’s employment as a result of Executive’s death or
      disability will not be deemed to be a Constructive Termination.




**6.8**  “ ***Covered
      Termination*** ”
means
      an Involuntary Termination Without Cause or a Constructive
      Termination.




**6.9**  “ ***Excise
      Tax*** ”
means
      the excise tax imposed by Section 4999 of the Code, together with any interest
      or penalties imposed with respect to such excise tax.




**6.10**  “ ***Involuntary
      Termination Without Cause*** ”
means
      Executive’s dismissal or discharge other than for Cause. The termination of
      Executive’s employment as a result of Executive’s death or disability will not
      be deemed to be an Involuntary Termination Without Cause.




**6.11**  A
      “ ***Payment*** ”
shall
      mean any payment or distribution in the nature of compensation (within the
      meaning of Section 280G(b)(2) of the Code) to or for the benefit of the
      Executive, whether paid or payable pursuant to this Agreement or
      otherwise.




**6.12**  “ ***Stock
      Awards*** ”
means
      all stock options, restricted stock and such other awards granted pursuant
      to
      the Company’s stock option and equity incentive award plans or agreements and
      any shares of stock issued upon exercise thereof,  and
      any
      awards into which such awards are converted by reason of a Change of Control
      (e.g., by reason of assumption, substitution or conversion by the successor
      entity or acquiring corporation) .




10.




**ARTICLE
      7**




**GENERAL
      PROVISIONS**




**7.1**  **Employment
      Status.** This
      Agreement does not constitute a contract of employment or impose upon Executive
      any obligation to remain as an employee, or impose on the Company any obligation
      (a) to retain Executive as an employee, (b) to change the status of Executive
      as
      an at-will employee, or (c) to change the Company’s policies regarding
      termination of employment.




**7.2**  **Notices.** Any
      notices provided hereunder must be in writing, and such notices or any other
      written communication shall be deemed effective upon the earlier of personal
      delivery (including personal delivery by facsimile) or the third day after
      mailing by first class mail to the Company at its primary office location and
      to
      Executive at Executive’s address as listed in the Company’s payroll records. Any
      payments made by the Company to Executive under the terms of this Agreement
      shall be delivered to Executive either in person or at the address as listed
      in
      the Company’s payroll records.




**7.3**  **Severability.** Whenever
      possible, each provision of this Agreement will be interpreted in such manner
      as
      to be effective and valid under applicable law, but if any provision of this
      Agreement is held to be invalid, illegal or unenforceable in any respect under
      any applicable law or rule in any jurisdiction, such invalidity, illegality
      or
      unenforceability will not affect any other provision or any other jurisdiction,
      but this Agreement will be reformed, construed and enforced in such jurisdiction
      as if such invalid, illegal or unenforceable provisions had never been contained
      herein.




**7.4**  **Waiver.** If
      either party should waive any breach of any provisions of this Agreement, she
      or
      it shall not thereby be deemed to have waived any preceding or succeeding breach
      of the same or any other provision of this Agreement.




**7.5**  **Arbitration.** Any
      dispute, claim or controversy based on, arising out of or relating to
      Executive’s employment or this Agreement shall be settled by final and binding
      arbitration in San Mateo County, California, before a single neutral arbitrator
      in accordance with the National Rules for the Resolution of Employment Disputes
      (the “ ***Rules*** ”)
      of the
      American Arbitration Association, and judgment on the award rendered by the
      arbitrator may be entered in any court having jurisdiction. Arbitration may
      be
      compelled pursuant to the California Arbitration Act (Code of Civil
      Procedure §§
      1280 *et
      seq* .).
      If
      the parties are unable to agree upon an arbitrator, one shall be appointed
      by
      the AAA in accordance with its Rules. Each party shall pay the fees of its
      own
      attorneys, the expenses of its witnesses and all other expenses connected with
      presenting its case; *however* ,
      Executive and the Company agree that, to the extent permitted by law, the
      arbitrator may, in his or her discretion, award reasonable attorneys’ fees to
      the prevailing party. Other costs of the arbitration, including the cost of
      any
      record or transcripts of the arbitration, AAA’s administrative fees, the fee of
      the arbitrator, and all other fees and costs, shall be borne by the Company.
      This Section 7.5 is intended to be the exclusive method for resolving any and
      all claims by the parties against each other for payment of damages under this
      Agreement or relating to Executive’s employment; *provided,
      however* ,
      that
      neither this Agreement nor the submission to arbitration shall limit the
      parties’ right to seek provisional relief, including, without limitation,
      injunctive relief, in any court of competent jurisdiction pursuant to California
      Code of Civil Procedure Sec. 1281.8 or any similar statute of an applicable
      jurisdiction. Seeking any such relief shall not be deemed to be a waiver of
      such
      party’s right to compel arbitration. Both Executive and the Company expressly
      waive their right to a jury trial. Pursuant to California Civil Code Section
      1717, each party warrants that it was represented by counsel in the negotiation
      and execution of this Agreement, including the attorneys’ fees provision
      herein.




11.




**7.6**  **Complete
      Agreement.** This
      Agreement, including Exhibit A and Exhibit B, constitutes the entire agreement
      between Executive and the Company, and is the complete, final, and exclusive
      embodiment of their agreement with regard to severance benefits to Executive
      in
      the event of employment termination, wholly superseding all written and oral
      agreements with respect to severance benefits to Executive in the event of
      employment termination. It is entered into without reliance on any promise
      or
      representation other than those expressly contained herein. Notwithstanding
      anything herein to the contrary, this Agreement shall not supersede any
      indemnification agreement between Executive and the Company.




**7.7**  **Amendment
      or Termination of Agreement.** This
      Agreement may be changed or terminated only upon the mutual written consent
      of
      the Company and Executive. The written consent of the Company to a change or
      termination of this Agreement must be signed by an executive officer of the
      Company after such change or termination has been approved by the Board or
      committee thereof.




**7.8**  **Counterparts.** This
      Agreement may be executed in separate counterparts, any one of which need not
      contain signatures of more than one party, but all of which taken together
      will
      constitute one and the same Agreement.




**7.9**  **Headings.** The
      headings of the Articles and Sections hereof are inserted for convenience only
      and shall not be deemed to constitute a part hereof nor to affect the meaning
      thereof.




**7.10**  **Successors
      and Assigns.** This
      Agreement is intended to bind and inure to the benefit of and be enforceable
      by
      Executive, and the Company, and any surviving entity resulting from a Change
      of
      Control and upon any other person who is a successor by merger, acquisition,
      consolidation or otherwise to the business formerly carried on by the Company,
      and their respective successors, assigns, heirs, executors and administrators,
      without regard to whether or not such person actively assumes any rights or
      duties hereunder; *provided,
      however* ,
      that
      Executive may not assign any duties hereunder and may not assign any rights
      hereunder without the written consent of the Company, which consent shall not
      be
      withheld unreasonably.




**7.11**  **Choice
      of Law.** All
      questions concerning the construction, validity and interpretation of this
      Agreement will be governed by the law of the State of California, without regard
      to such state’s conflict of laws rules.




**7.12**  **Non-Publication.** The
      parties mutually agree not to disclose publicly the terms of this Agreement
      except to the extent that disclosure is mandated by applicable law or regulation
      or to their respective advisors ( *e.g* .,
      attorneys, accountants).




**7.13**  **Construction
      of Agreement.** In the
      event of a conflict between the text of the Agreement and any summary,
      description or other information regarding the Agreement, the text of the
      Agreement shall control.




**(** ***Signature
      Page Follows*** **)**




12.


**IN
      WITNESS WHEREOF,** the
      parties have executed this Agreement on the Effective Date written
      above.




**SUNESIS
              PHARMACEUTICALS, INC.**
            ****
            **VALERIE
              L. PIERCE**By:
            /s/
              D
              N Swisher
            
            /s/
                Valerie PierceName:
            Daniel
              SwisherTitle:
            CEO








Exhibit
      A: Release (Individual Termination)


Exhibit
      B: Release (Group Termination)







**EXHIBIT
      A**




**RELEASE**


**(INDIVIDUAL
      TERMINATION)**




I
      understand that this Release, together with the Amended and Restated Executive
      Severance Benefits Agreement, constitutes the complete, final and exclusive
      embodiment of the entire agreement between the Company, affiliates of the
      Company and me with regard to the subject matter hereof. I am not relying on
      any
      promise or representation by the Company that is not expressly stated therein. Certain
      capitalized terms used in this Release are defined in the Amended and Restated
      Executive Severance Benefits Agreement, which I have executed and of which
      this
      Release is a part.




**1.**  **Proprietary
      Information Obligations.** I
      hereby
      confirm my obligations under my Confidentiality Agreement with the
      Company.




**2.**  **General
      Release.** In
      exchange for severance benefits and other consideration provided to me by the
      Amended and Restated Executive Severance Benefits Agreement that I am
      not otherwise entitled to receive, I hereby generally and completely release the
      Company and its current and former directors, officers, employees, stockholders,
      shareholders, partners, agents, attorneys, predecessors, successors, parent
      and
      subsidiary entities, insurers, affiliates, and assigns (collectively, the
“ ***Released
      Parties*** ”)
      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 Release (collectively, the “ ***Released
      Claims*** ”).
      The
      Released Claims include, but are not limited to: (1) all claims arising out
      of
      or in any way related to my employment with the Company or its affiliates,
      or
      the termination of that employment; (2) all claims related to my compensation
      or
      benefits, including salary, bonuses, commissions, vacation pay, expense
      reimbursements, severance pay, fringe benefits, stock, stock options, or any
      other ownership interests in the Company or its affiliates; (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*** ”),
      the
      federal Employee Retirement Income Security Act of 1974 (as amended), and the
      California Fair Employment and Housing Act (as amended). Notwithstanding the
      foregoing, the following are not included in the Released Claims (the
“ ***Excluded
      Claims*** ”):
      (1)
      any rights or claims for indemnification I may have pursuant to any written
      indemnification agreement with the Company to which I am a party, the charter,
      bylaws, or operating agreements of the Company, or under applicable law; or
      (2)
      any rights which are not waiveable as a matter of law. In addition, nothing
      in
      this Release prevents me from filing, cooperating with, or participating in
      any
      proceeding before the Equal Employment Opportunity Commission, the Department
      of
      Labor, or the California Department of Fair Employment and Housing, except
      that
      I hereby waive my right to any monetary benefits in connection with any such
      claim, charge or proceeding. I hereby represent and warrant that, other than
      the
      Excluded Claims, I am not aware of any claims I have or might have against
      any
      of the Released Parties that are not included in the Released
      Claims.




1.




**3.**  **ADEA
      Waiver** . I
      acknowledge that I am knowingly and voluntarily waiving and releasing any rights
      I may have under the ADEA. I also acknowledge that the consideration given
      for
      the Released Claims 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) the Released Claims do not apply to any rights
      or claims that arise after the date I sign this Release; (b) I should consult
      with an attorney prior to signing this Release (although I may choose
      voluntarily not to do so); (c) I have twenty-one (21) days to consider this
      Release (although I may choose to voluntarily sign it sooner); (d) I have seven
      (7) days following the date I sign this Release to revoke the Release by
      providing written notice to an officer of the Company; and (e) the Release
      will
      not be effective until the date upon which the revocation period has expired
      unexercised, which will be the eighth day after I sign this Release
      (“ ***Effective
      Date*** ”).




**4.**  **Section
      1542 Waiver.**  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 or her favor at the time of executing the release,
      which
      if known by him or her must have materially affected his or 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 my release of
      any
      claims I may have against the Company.




**5.**  **Representations.** I hereby
      represent that I have been paid all compensation owed and for all hours worked,
      I have received all the leave and leave benefits and protections for which
      I am
      eligible, and I have not suffered any on-the-job injury for which I have not
      already filed a workers’ compensation claim.




**6.**  **Non-Disparagement.** I hereby
      agree not to disparage the Company, or its officers, directors, employees,
      shareholders or agents, in any manner likely to be harmful to its or their
      business, business reputation, or personal reputation; *provided,
      however,* that I
      will respond accurately and fully to any question, inquiry or request for
      information when required by legal process.




I
      acknowledge that to become effective, I must sign and return this Release to
      the
      Company on or after ____________________, so that it is received not later
      than
      twenty-one (21) days following the date it is provided to me, and I must not
      revoke it thereafter.




**VALERIE
                  L. PIERCE**Date:
  2.


**EXHIBIT
      B**




**RELEASE**


**(GROUP
      TERMINATION)**




I
      understand that this Release, together with the Amended and Restated Executive
      Severance Benefits Agreement, constitutes the complete, final and exclusive
      embodiment of the entire agreement between the Company, affiliates of the
      Company and me with regard to the subject matter hereof. I am not relying on
      any
      promise or representation by the Company that is not expressly stated therein. Certain
      capitalized terms used in this Release are defined in the Amended and Restated
      Executive Severance Benefits Agreement, which I have executed and of which
      this
      Release is a part.




**1.**  **Proprietary
      Information Obligations.** I
      hereby
      confirm my obligations under my Confidentiality Agreement with the
      Company.




**2.**  **General
      Release.** In
      exchange for severance benefits and other consideration provided to me by the
      Amended and Restated Executive Severance Benefits Agreement that I am not
      otherwise entitled to receive, I hereby generally and completely release the
      Company and its current and former directors, officers, employees, stockholders,
      shareholders, partners, agents, attorneys, predecessors, successors, parent
      and
      subsidiary entities, insurers, affiliates, and assigns (collectively, the
“ ***Released
      Parties*** ”)
      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 Release (collectively, the “ ***Released
      Claims*** ”).
      The
      Released Claims include, but are not limited to: (1) all claims arising out
      of
      or in any way related to my employment with the Company or its affiliates,
      or
      the termination of that employment; (2) all claims related to my compensation
      or
      benefits, including salary, bonuses, commissions, vacation pay, expense
      reimbursements, severance pay, fringe benefits, stock, stock options, or any
      other ownership interests in the Company or its affiliates; (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*** ”),
      the
      federal Employee Retirement Income Security Act of 1974 (as amended), and the
      California Fair Employment and Housing Act (as amended). Notwithstanding the
      foregoing, the following are not included in the Released Claims (the
“ ***Excluded
      Claims*** ”):
      (1)
      any rights or claims for indemnification I may have pursuant to any written
      indemnification agreement with the Company to which I am a party, the charter,
      bylaws, or operating agreements of the Company, or under applicable law; or
      (2)
      any rights which are not waiveable as a matter of law. In addition, nothing
      in
      this Release prevents me from filing, cooperating with, or participating in
      any
      proceeding before the Equal Employment Opportunity Commission, the Department
      of
      Labor, or the California Department of Fair Employment and Housing, except
      that
      I hereby waive my right to any monetary benefits in connection with any such
      claim, charge or proceeding. I hereby represent and warrant that, other than
      the
      Excluded Claims, I am not aware of any claims I have or might have against
      any
      of the Released Parties that are not included in the Released
      Claims.




1.




**3.**  **ADEA
      Waiver** .
      I
      acknowledge that I am knowingly and voluntarily waiving and releasing any rights
      I may have under the ADEA. I also acknowledge that the consideration given
      for
      the Released Claims 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) the Released Claims do not apply to any rights
      or claims that arise after the date I sign this Release; (b) I should consult
      with an attorney prior to signing this Release (although I may choose
      voluntarily not to do so); (c) I have forty-five (45) days to consider this
      Release (although I may choose to voluntarily sign it sooner); (d) I have seven
      (7) days following the date I sign this Release to revoke the Release by
      providing written notice to an officer of the Company; and (e) the Release
      will
      not be effective until the date upon which the revocation period has expired
      unexercised, which will be the eighth day after I sign this Release
      (“ ***Effective
      Date*** ”).
      I
      have received with this Release all of the information required by the ADEA,
      including without limitation a
      detailed list of the job titles and ages of all employees who were terminated
      in
      this group termination and the ages of all employees of the Company in the
      same
      job classification or organizational unit who were not terminated ,
      along
      with information on the eligibility factors used to select employees for the
      group termination and any time limits applicable to this group termination
      program.




**4.**  **Section
      1542 Waiver.**  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 or her favor at the time of executing the release,
      which
      if known by him or her must have materially affected his or 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 my release of
      any
      claims I may have against the Company.




**5.**  **Representations.** I hereby
      represent that I have been paid all compensation owed and for all hours worked,
      I have received all the leave and leave benefits and protections for which
      I am
      eligible, and I have not suffered any on-the-job injury for which I have not
      already filed a workers’ compensation claim.




**6.**  **Non-Disparagement.** I hereby
      agree not to disparage the Company, or its officers, directors, employees,
      shareholders or agents, in any manner likely to be harmful to its or their
      business, business reputation, or personal reputation; *provided,
      however,* that I
      will respond accurately and fully to any question, inquiry or request for
      information when required by legal process.




2.


I
      acknowledge that to become effective, I must sign and return this Release to
      the
      Company on or after ____________________, so that it is received not later
      than
      forty-five (45) days following the date it is provided to me, and I must not
      revoke it thereafter.





**VALERIE
                  L. PIERCE**Date:
 
 3.