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     b. Base Salary Adjustments. Executive’s Base Salary shall be reviewed at leastannually in accordance with the Company’s customary practices for its executives. The Board or acommittee thereof may make such adjustments, as it deems appropriate in its sole discretion;*provided*, *however*, in no event shall the Company pay Executive a Base Salary of less than $280,000,unless the change to Executive’s Base Salary was applicable to the annual base salary of all seniorexecutives of the Company in substantially the same manner. In making such adjustments the Board ora committee thereof may solicit and give consideration to the views of the CEO.     c. Incentive Compensation. While the Company employs Executive during the Term,Executive’s annual incentive compensation (“Incentive Compensation”) shall be targeted at30% of base compensation, the exact amount of which shall be determined by the Board or a committeethereof in its sole discretion. Executive shall be eligible for Incentive Compensation commencingat the start of the Initial Term. Such bonus, if any, shall be paid within ninety (90) daysfollowing the last day of each fiscal year of the Company. In making such determinations, the Boardor a committee thereof may solicit and take into consideration the views of the CEO.     d. Certain Other Benefits. Commencing on the first day of the month after thirty (30)days of continuous service to the Company and throughout the Term, Executive shall be entitled toparticipate in any and all employee benefit plans and arrangements which are available to seniorexecutive officers of the Company, including without limitation, group medical, disability and lifeinsurance plans, and Company’s Directors and Officers (D&O) insurance policy. Executive shall alsobe afforded no fewer than twenty-three (23) days paid time off (PTO) pursuant to policies fixed bythe Company.     e. Expenses. The Company shall pay or reimburse Executive for all reasonable businessexpenses actually paid or incurred by Executive while Executive is employed by the Company duringthe Term subject to reasonable documentation and in accordance with the Company’s business expensereimbursement policy; *provided*, *however*, such business expenses do not include personal travel andcommuting expenses between Executive’s home in Oxnard, California and the Company’s offices duringExecutive’s relocation period.     f. Relocation Expenses.     (i) The Company shall reimburse Executive for (i) reasonable expenses for up to two (2)round trips between Oxnard, California and the Washington D.C. area for purposes of househunting, and (ii) reasonable short-term living or rental expenses for up to three (3) monthsin the Washington, D.C. area.     (ii) In addition to the payments set forth in Section 3(f)(i), the Company shallreimburse Executive an aggregate of $100,000 for relocation expenses (the “RelocationExpense Payment”), consisting of (i) $50,000, payable in a lump sum within thirty (30)days of the date of this Agreement and (ii) $50,000 upon the submission of itemized receiptsconnected with the relocation from California to Maryland, payable in a lump sum within 30calendar days of the submission of such receipts. The Relocation Expense Payment isintended to be used by Executive for customary relocation expenses including, but notlimited to, moving company expenses, house hunting, temporary housing, temporary storage orvehicle transportation costs.
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     (iii) If Executive terminates his employment with the Company without Good Reason andwithin twenty four (24) months of the date of this Agreement, Executive shall reimburse theCompany for all or a portion of the Relocation Expense Payment as follows:     (a) if the Executive terminates his employment within twelve months of thedate of this Agreement, Executive shall repay 50% of the Relocation Expense Payment;and     (b) if the Executive terminates his employment at any time between thirteenand eighteen months after the date of this Agreement, Executive shall repay 25% ofthe Relocation Expense Payment.Any reimbursement by Executive to the Company of the Relocation Expense Payment in accordance withthis Section 3(f) shall be made within ten (10) business days of Executive’s voluntary terminationdate, payable in a lump sum.4. Term.The term of this Agreement shall be the period commencing on June 18, 2008 and continuing for oneyear (the “Initial Term”); provided, however, that the Term of this Agreement shall beextended automatically for successive one year periods (each one-year extension a “SuccessorTerm” and together with the Initial Term referred to herein as the “Term”) unlesswritten notice of nonextension is provided by either party to the other party at least sixty (60)days prior to the end of the Initial Term or any Successor Term. In the event that this Agreementis not extended at the end of the Initial Term or any Successor Term and thereby terminates, onlyparagraphs 6, 7, 8(d), 8(g), 8(h), 8(i) and 11 shall survive such termination, except thatExecutive shall be entitled to receive compensation and benefits to the extent expressly providedherein or by the terms of any of the Company’s compensation and benefit plans, programs or policiesor as required by applicable law.5. Stock Options.          (i) Upon Executive’s commencement of employment, the Company shall grant a stock option toExecutive to purchase 200,000 shares of Company common stock with a per share exercise price equalto the closing price of the Company’s stock on the date of grant (the “Initial Grant”).The Initial Grant shall vest as follows, provided the Executive is then employed with the Companyon each such date:   3 Months After Date of Grant 25% of the Initial Grant 1 Year After Date of Grant 25% of the Initial Grant 2 Years After Date of Grant 25% of the Initial Grant 3 Years After Date of Grant 25% of the Initial Grant          (ii) The Company shall also grant Executive an option to purchase 100,000 shares of Companycommon stock with a per share exercise price equal to the closing price of the Company’s stock onthe date of grant, which shares shall vest in full upon the consummation of the first partnering orstrategic transaction initiated solely by the Executive (the “Transaction Grant”). TheBoard of Directors shall have the sole discretion to determine whether the conditions for thevesting of the Transaction Grant have been satisfied.
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          (iii) Other periodic stock and incentive stock option grants to Executive, if any, while theCompany employs Executive during the Term shall be determined by the Board or a committee thereofin its discretion. In the event of a termination pursuant to paragraph 8(d) hereof or a resignationpursuant to paragraph 9 hereof, for which purposes sections 10(a) and 10(c) of this Agreement shallcontrol, all vested options held by Executive on the effective date of such termination orresignation shall be exercisable in accordance with the terms of such grants until the later of thedate set forth in such grant or twelve (12) months following Executive’s date of termination, butin no event beyond the expiration date of the relevant option. Upon a change in control, as definedin the Executive’s option agreement, occurring more than six (6) months after the effective date ofthis Agreement, all unvested options shall vest and become exercisable immediately. All otherunvested options shall expire in accordance with the terms of such grants. Except as set forthherein, the terms of the stock option grants under this paragraph 5 shall be otherwise inaccordance with and subject to the terms of the Company’s 2001 Long Term Incentive Plan, asamended, or successor plan and such terms and conditions as the Board or a committee thereof mayspecify.6. Unauthorized Disclosure.During the Term and at all times thereafter, Executive shall not, without the written consent ofthe Company, or except as required by applicable law, disclose to any person, other than a personto whom disclosure is reasonably necessary or appropriate in connection with the performance byExecutive of his duties as an executive officer of the Company, any material confidentialinformation obtained by Executive while in the employ of the Company with respect to the businessesof the Company or any of its subsidiaries, including but not limited to, operations, pricing,contractual or personnel data, products, discoveries, improvements, trade secrets, licenseagreements, marketing information, suppliers, dealers, principles, customers, or methods ofdistribution, or any other confidential information the disclosure of which Executive knows, or inthe exercise of reasonable care should know, will be damaging to the Company; provided, however,that confidential information shall not include any information known generally to the public or topersons in the industry of which the Company’s business is a part (in each case, other than as aresult of unauthorized disclosure by Executive) or any information otherwise considered by theCompany not to be confidential.7. Indemnification.      a. The Company shall defend, indemnify and hold harmless Executive if he is made a party, orthreatened to be made a party, to any threatened, pending or completed action, suit or proceeding,whether civil, criminal, administrative, or investigative (a “Proceeding”), because he isor was an officer or director of the Company or any of its subsidiaries, affiliates, or successors,or because he is or was serving in a fiduciary capacity with respect to employee benefit plans ofthe Company, whether or not the basis of such Proceeding is alleged action in an official capacityor otherwise, against all Expenses incurred or suffered by him in connection with such Proceedingto the fullest extent authorized by the General Corporation Law of the State of Delaware and anyother applicable law in effect from time to time, and such indemnification shall continue as toExecutive even if he ceases to be an officer or director or is no longer employed by the Company,and shall inure to the benefit of Executive’s heirs, executors and administrators.     b. As used in this Agreement, the term “Expenses” shall include, without limitation, damages,losses, judgments, liabilities, fines, penalties, excise taxes, settlements and reasonable
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costs, reasonable attorneys’ fees, reasonable accountants’ fees, and reasonable disbursementsand costs of attachment or similar bonds, investigations, and any reasonable expenses ofestablishing a right to indemnification under this Agreement.     c. Expenses incurred by Executive in connection with any Proceeding shall be paid by theCompany upon presentation of appropriate documentation and a giving by Executive of anyundertakings required by applicable law.8. Termination.     a. Upon Death. If Executive dies while employed by the Company during the Term, hisestate shall be entitled to receive payment of Base Salary through the last day of the nine (9)months following the month in which his death occurred, payable over nine (9) months at theCompany’s normal pay periods. If, in respect of the fiscal year in which Executive dies the Boardor a committee thereof determines in its discretion that he would otherwise have been entitled toreceive Incentive Compensation under subparagraph 3(c) by reason of the operations of the Companyduring such fiscal year, Executive’s estate shall be entitled to receive a pro rata portion of hisIncentive Compensation for such fiscal year. Such pro rata portion shall equal the product of (x)the full amount of such Incentive Compensation, and (y) a fraction, the numerator of which is thenumber of days in the fiscal year of Executive’s death prior to the date of death, and thedenominator of which is the total number of days in such fiscal year.     b. Termination Upon Disability. The Company may terminate Executive’s employmenthereunder during the Term at the end of any calendar month in the event of his Disability by givingto Executive written notice of termination. In the event of any such termination pursuant to thissubparagraph 8(b), Executive shall be entitled to receive his Base Salary, payable in accordancewith the Company’s customary payroll policy for it executives, through the last day of the nine (9)months following the month in which the date of termination occurred. If in respect of the fiscalyear in which Executive’s employment terminates pursuant to this subparagraph 8(b) the Board or acommittee thereof determines in its discretion that he would otherwise have been entitled toreceive Incentive Compensation under subparagraph 3(c) by reason of the operations of the Companyduring such fiscal year, Executive shall be entitled to receive a pro rata portion of his IncentiveCompensation for such year. Such pro rata portion shall equal the product of (x) the full amountof such Incentive Compensation, and (y) a fraction, the numerator of which is the number of days inthe fiscal year of Executive’s termination on account of Disability prior to the date oftermination, and the denominator of which is the total number of days in such fiscal year.     c. Termination for Cause. The Company may terminate Executive’s employment hereunderat any time during the Term for Cause by giving to Executive written notice of termination thatspecifies the reasons for and date of termination, subject to the terms of sub-paragraph 10(a)hereunder. Upon any such termination for Cause under this subparagraph 8(c), the Company shall payto Executive Base Salary through the date of termination, including the benefits provided atparagraph 3(d), and the Company shall have no further obligations under this Agreement.     d. Termination Without Cause. The Company may terminate Executive’s employment withthe Company at any time during the Term, for any reason and without Cause, by giving him writtennotice thirty (30) days prior to the date of termination. Until the effective date of any suchtermination, the Company shall continue to pay to Executive the full compensation specified in thisAgreement, including the benefits provided at paragraph 3(d). Following the date of termination,
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Executive shall make himself reasonably available to members of the Board, the CEO, and othersenior managers and officers of the Company to assist in the transition of responsibilities andinformation to others and to facilitate the orderly conduct of business operations. Upontermination, the Company shall have no other financial obligations to Executive under anycompensation or benefit plan, program or policy and Executive’s participation in the Company’scompensation and benefit plans, programs and policies shall cease as of the date of Executive’stermination except as set forth herein or as expressly provided under the terms of any such plans,programs or policies, or as required by applicable law. However, in addition to the above, ifExecutive is terminated (i) pursuant to this subparagraph 8(d) or (ii) the Term is not extended inaccordance with Section 4 and for any reason other than Cause, the Company shall (i) pay Executivea severance amount equal to nine (9) months Base Salary over the following nine (9) months at theCompany’s normal pay periods, and (ii) provide Executive coverage under the Company’s healthinsurance program, under the same terms as are available to other senior executive officers of theCompany, for a period of nine (9) months, after which Executive would be eligible for COBRAcontinuation coverage, or until he has obtained substantially equivalent new coverage, asdetermined by the Board or a committee thereof in its discretion, through successor employment,whichever occurs sooner. If, in respect of the fiscal year in which Executive’s employmentterminates pursuant to this subparagraph 8(d), the Board or a committee thereof determines in itsdiscretion that he would otherwise have been entitled to receive Incentive Compensation undersubparagraph 3(c) by reason of the operations of the Company during such fiscal year, Executiveshall be entitled to receive a pro rata portion of his Incentive Compensation for such year. Suchpro rata portion shall equal the product of (x) the full amount of such Incentive Compensation, and(y) a fraction, the numerator of which is the number of days in the fiscal year of Executive’stermination without Cause prior to the date of termination, and the denominator of which is thetotal number of days in such fiscal year.     e. Resignation for Other than Good Reason. Executive may voluntarily terminate hisemployment with the Company during the Term for any reason upon at least thirty (30) days priorwritten notice, which specifies the effective date of termination. Until the effective date ofsuch termination, the Company shall continue to pay him the full compensation specified in thisAgreement, including the benefits provided at paragraph 3(d), provided he continues to perform hisduties during this period. Thereafter, the Company shall have no further obligations to him underthis Agreement. This subparagraph 8(e) shall not apply to Executive’s resignation for Good Reasonpursuant to paragraph 9 hereof.     f. No Mitigation. The parties hereto acknowledge and agree that, in the eventExecutive’s employment with the Company is terminated pursuant to this paragraph 8, he shall not berequired to mitigate his damages by affirmatively seeking other employment. Further, except asprovided in subparagraph 8(d)(ii) above, the amount of any payment or benefit provided for in thisAgreement shall not be reduced by any compensation earned by him or benefit provided to him as theresult of employment by another employer or otherwise.     g. Non-Competition. For the period of (i) twelve (12) months after resignation forother than for Good Reason, or (ii) six (6) months after termination of employment with the Companyfor any other reason, Executive shall not, as an individual, principal, agent, employee, consultantor otherwise, directly or indirectly, or with respect to any company or entity with which theCompany has concluded partnership, licensing, joint research and development or other similarbusiness agreements during his employment with the Company, render any services to any firm orcompany or any division or subsidiary of any firm or company, engaged in the development orcommercialization of compounds, analogs or derivatives of those compounds that (a) are of a similar
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type, that is, small molecules, (for example, but not limited to, small peptidomimetic molecules),(b) have more than one mechanism of action and cellular pathway in common with; and (c) are withinthe same field (i.e. oncology or inflammation) as, those being developed and orcommercialized by the Company during the Term (“Competing Company”). In addition, for anadditional period of six (6) months after the six-month period set forth above and subject toSection 6 hereof, Executive only may provide services to such a Competing Company if Executive doesnot work on, or furnish confidential information regarding, any matter related to such compoundsdefined above. Moreover, for a period of twelve (12) months after the termination of Executive’semployment with the Company, Executive shall not take any action, without the prior written consentof the Company, to assist Executive’s successor employer or any other entity in recruiting orhiring any other employee who was an employee of the Company during Executive’s employment. Thisprohibition includes (i) identifying to such successor employer or its agents or such other entity,the person or persons who have special knowledge concerning the Company or its inventions,processes, methods or confidential affairs, and (ii) commenting to Executive’s successor employeror its agents or such other entity about the quantity or work, quality of work, special knowledgeor personal characteristics of any person who is still employed by the Company. Executive alsoagrees that he will not provide such information to a prospective employer or to an executivesearch firm during interviews preceding possible employment.     h. Non-Disparagement. During the Term and thereafter, Executive shall not communicatenegatively about or otherwise disparage the Company or its products or each and any of the releasedparties described in subparagraph 8(i) in any way whatsoever except as may be required for truthfulsworn testimony or in connection with a legal or administrative proceeding, report, claim ordispute. The Company, acting in its official capacity, shall not make any public false, disparagingor derogatory statements in connection with or concerning Executive’s service to the Company exceptas may be required for truthful sworn testimony or in connection with a legal or administrativeproceeding, report, claim or dispute. After termination, in the event Executive materially breachesany of the conditions set forth herein or in any other paragraph of this Agreement, the Company maydiscontinue the provision of any payment or benefits to him under this Agreement, and in such eventhe shall forfeit his entitlement to any further termination payments or benefits under thisAgreement. After termination, in the event the Company materially breaches any of the conditionsset forth herein or in any other paragraph of this Agreement, the Executive may pursue any remediesavailable to him at law.     i. Release. In consideration of Executive’s receipt of severance benefits subject toand in accordance with subparagraphs 8(b) and (d) and paragraph 9 of this Agreement, Executiveagrees that, upon his first receipt and acceptance of any such benefits, he shall have released andforever discharged the Company, its subsidiaries and affiliates, successors and assigns,predecessors and all of their respective officers, directors, employees and agents and employeebenefits plans from all claims, demands, liabilities and causes of action arising out of facts oroccurrences arising or occurring at any time up to and including the time of Executive’stermination or resignation, whether known or unknown, and the parties hereto contemplate that thisrelease shall be broadly construed.9. Resignation for Good Reason.If Executive has Good Reason during the Term, Executive may resign at any time during the Term byproviding at least thirty (30) days prior written notice to the Company that specifies the reasonfor, and the effective date of, his resignation. If Executive resigns during the Term for GoodReason, such resignation shall be deemed a Termination without Cause under subparagraph 8(d) hereofand
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Executive shall receive the compensation and benefits provided under subparagraph 8(d) hereof as ifhe had been terminated without Cause.10. Definitions.     a. “*Cause”* shall mean Executive’s (i) habitual drunkenness or drug addiction, (ii) materialfailure to perform and discharge his duties and responsibilities hereunder, (iii) misconduct thatis materially and significantly injurious to the Company, (iv) conviction of a felony involving thepersonal dishonesty of Executive or moral turpitude, (v) conviction of any crime or offenseinvolving the property of the Company or (vi) material breach of Executive’s obligations under thisAgreement, *provided*, *however*, with regard to Section 10(a)(ii) and 10(a)(vi) above, the partiesexclude for this purpose an action not taken in bad faith that is remedied by Executive promptlyupon receipt of written notice thereof given to the Company.     b. *“Disability”*shall mean the Executive’s incapacity due to physical or mental illness whichprevents the proper performance of Executive’s duties as set forth herein or established pursuanthereto for ninety (90) days in any twelve (12) month period of the Term. A qualified independentphysician mutually selected by the Company and the Executive shall determine any questions as tothe existence or extent of illness or incapacity of Executive, upon which the Company and Executivecannot agree. The determination of such physician certified in writing to the Company and to theExecutive shall be final and conclusive for all purposes of this Agreement. For purposes of thedisability provisions of this Agreement, if the Executive is unable to act on his own behalf due toincapacity, any person legally authorized to do so may act on the Executive’s behalf.     c. *“Good Reason”*shall mean the occurrence of any of the following events during the Term:(A) the assignment to Executive of any duties inconsistent in any material respect with Executive’sposition, authority, duties or responsibilities as of the commencement of the Term or any otheraction by the Company which results in a diminution in any material respect in such position,duties or responsibilities, excluding for this purpose an isolated and inadvertent action not takenin bad faith that is remedied by the Company promptly after receipt of written notice thereof givenby Executive; (B) a reduction by the Company in Executive’s annual Base Salary as in effect on thedate hereof or subsequently in effect hereunder, except as agreed to by Executive, unless suchchange was applicable to all senior executives of the Company; (C) the failure by the Company tocontinue to provide Executive with benefits substantially similar to those enjoyed by him under anyof the Company’s pension, life insurance, medical, health and accident, disability or other welfareplans in which he was participating as of the commencement of the Term or subsequently in effecthereunder, unless such change was applicable to all senior executives of the Company; (D) thefailure by the Company to pay to Executive any deferred compensation when due under any deferredcompensation plan or agreement applicable to him; (E) the failure by the Company to honor in anymaterial respect the terms and provisions of this Agreement; or (G) a requirement by the Companythat Executive conduct his duties and responsibilities from a permanent location more than fifty(50) miles from the place of employment, as defined in paragraph 2 herein.11. Miscellaneous.     a. Assignments and Binding Effect. The respective rights and obligations of theparties under this Agreement shall be binding upon the parties hereto and their heirs, executors,administrators, successors, and assigns, including, in the case of the Company, any othercorporation
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or entity with which the Company may be merged or otherwise combined and, in the case ofExecutive, his estate or other legal representatives.     b. No Assignment of Benefits. Except as otherwise provided herein or by applicablelaw, no right or interest of the Executive under this Agreement shall be assignable ortransferable, in whole or in part, either directly or by the operation of law or otherwise,including without limitation execution, levy, garnishment, attachment, pledge or in any manner; noattempted transfer thereof shall be effective.     c. Governing Law. This Agreement shall be governed as to its validity, interpretationand effect by the laws of the State of Maryland, without reference to its conflict of lawsprovisions.     d. Severability. In the event that any provision or portion of this Agreement shallbe determined to be invalid, illegal, or unenforceable for any reason, the remaining provisions andportions of this Agreement shall remain in full force and effect to the fullest extent permitted bylaw. Such invalid, illegal or unenforceable provision(s) shall be deemed modified to the extentnecessary to make it (them) valid, legal, and enforceable.     e. Withholding. All amounts payable hereunder shall be paid net of any applicablewithholding required under federal, state or local laws and any additional withholding to whichExecutive has agreed.     f. Entire Agreement; Amendments. This Agreement constitutes the entire Agreement andunderstanding of the Company and Executive with respect to the terms of Executive’s employment withthe Company and supersedes all prior discussions, understandings and agreements with respectthereto.     g. Captions. All captions and headings used herein are for convenient reference onlyand do not form part of this Agreement.     h. Waiver. No provision of this Agreement may be modified, waived or dischargedunless such modification, waiver or discharge is agreed to in writing and signed by the Executiveand the Board or its delegate. The failure of the Company or the Executive to insist upon strictcompliance with the terms of this Agreement or the failure of the Company or the Executive toassert any right the Company or the Executive may have hereunder shall not be deemed a waiver ofsuch provision or right or any other provision of this Agreement.     f. Notice. Any notice or communication required or permitted under this Agreementshall be made in writing and shall be delivered by hand, or mailed by registered or certified mail,return receipt requested, first call postage prepaid, addressed as follows:If to Executive:Thomas H. Bliss, Jr.