Exhibit 10.1


FIRST
AMENDMENT


TO AMENDED AND RESTATED SEVERANCE
AGREEMENT


This FIRST
AMENDMENT TO AMENDED AND RESTATED SEVERANCE AGREEMENT (“First Amendment”) is entered into on
April 27, 2007, by and between METABASIS
THERAPEUTICS, INC., a Delaware corporation (the “Company”), and PAUL K. LAIKIND (the “Employee”).
Capitalized terms used and not otherwise defined herein shall have the meanings
ascribed to such terms in the Severance Agreement (as defined below).


WHEREAS, the
Company and Employee have entered into an Amended and Restated Severance
Agreement dated July 19, 2006 (the “Severance  Agreement”); and


WHEREAS, the
Company and Employee desire to amend the Severance Agreement as set forth in
this First Amendment;


NOW, THEREFORE,
in consideration of the premises set forth herein and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Company and Employee hereby amend the Severance Agreement as follows:


1.  The following paragraph shall be added to the
end of Section 6 of the Severance Agreement:


“ The Employee’s receipt of any Severance Pay or
any other benefits pursuant to this Agreement shall be subject to, and
contingent upon, the Employee’s furnishing to the Company an effective Release
and Waiver of Claims in the form attached hereto as Exhibit A.”


2.  A new Section 11(i) is hereby added to the
Severance Agreement as follows:


“(i)          Application of Internal
Revenue Code Section 409A.  If
the Company determines that any severance benefit or payment under this
Agreement fails 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, 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 any such 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 so that such benefits are not subject to the provisions of Section
409A(a)(1) of the Internal Revenue Code. 
The Company may attach conditions to or adjust the amounts paid under
this Agreement to preserve, as closely as possible, the economic consequences
that would have applied in the absence of this Section 11(i); 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.”


3.  A new Section 11(j) is hereby
added to the Severance Agreement  as follows:


“(j)      At-Will
Employment; No Employment Rights. 
Employee acknowledges and agrees that Employee’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 Employee or the
Company, with or without Cause and with or without advance notice.  This “at-will” employment relationship cannot
be changed except in a writing signed by the Company’s Chairman of the Board.”













4.  A new Exhibit A is
hereby added to the Severance Agreement as follows:


“ EXHIBIT A


RELEASE
AND WAIVER OF CLAIMS


(TO BE
SIGNED FOLLOWING TERMINATION OF EMPLOYMENT)


In
consideration of the payments and other benefits set forth in the Severance
Agreement dated July 19, 2006 (the “Agreement”)
to which this form is attached, I, Paul K. Laikind hereby furnish METABASIS THERAPEUTICS, INC.
and any and all affiliated, subsidiary, related, or successor corporations
(collectively, the “Company”), with the
following release and waiver (“Release and Waiver”).


In
exchange for the consideration provided to me by the Agreement that I am not
otherwise entitled to receive, I hereby generally and completely release and
forever discharge the Company and its directors, officers, employees,
shareholders, partners, agents, attorneys, predecessors, successors, parent and
subsidiary entities, insurers, affiliates, and assigns from any and all claims,
liabilities, demands, causes of action, costs, expenses, attorneys’ fees,
damages, indemnities and obligations of every kind and nature, in law, equity
or otherwise, both 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 compensation or benefits from the Company, including, but
not limited to, salary, bonuses, commissions, vacation pay, expense
reimbursements, severance pay, fringe benefits, stock, stock options, or any
other ownership interests in the Company, other than as provided in the
Agreement (and provided further that nothing in this general release shall
affect (a) my right to receive a payout of my accrued but unused vacation
and/or paid time off as of my termination date or (b) my rights under any stock
options or other stock awards granted, or under any written commitments
regarding future grants of stock options or other stock awards approved, by the
Company’s Board of Directors or the Compensation Committee thereof prior to my
termination date); (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,
emotional distress, and discharge in violation of public policy, related to my
employment with the Company or the termination of that employment; and (5) all
federal, state, and local statutory claims related to my employment with the
Company or the termination of that employment, including, but not limited to,
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 favor at the time of executing the release,
which if known by him must have materially affected his settlement with the
debtor.”  I hereby
expressly waive and relinquish all rights and benefits under that section and
any law of any jurisdiction of similar effect with respect to any claims I may
have against the Company.


I
acknowledge and agree that, among other rights, I am waiving and releasing any
rights I may have under ADEA, that this Release and Waiver is knowing and
voluntary, and that the consideration given for this Release and Waiver is in
addition to anything of value to which I was already entitled as an executive
of the Company.  If I am 40 years of age
or older upon execution of this Release and Waiver, I further acknowledge that
I have been advised, as required by the Older Workers Benefit Protection Act,
that:  (a) the release and waiver granted
herein does not relate to claims under the ADEA which may arise after this
Release and Waiver is executed; (b) I should consult with an attorney prior to
executing this Release and Waiver; (c) I have twenty-one (21) days in which to
consider this Release and Waiver (although I may choose voluntarily to execute
this Release and Waiver earlier); (d) I have seven (7) days following the
execution of this Release and Waiver to revoke my consent to this Release and
Waiver; and (e) this Release and Waiver shall not be effective until the eighth
day after I execute this Release and Waiver and the revocation period has
expired.


I acknowledge my continuing
obligations under my Employee Proprietary Information and Inventions Agreement
with the Company (the “PIIA”) .













This Release and Waiver, along
with the PIIA, constitutes the complete, final and exclusive embodiment of the
entire agreement between 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 herein.  This Release and Waiver may only be modified
by a writing signed by both me and the Chief Executive Officer of the Company.


	
  Date:

  	
   

  	
   

  	
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  Print Name:

  	
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5.  Continuing Effect of Agreement.  Except as expressly set forth in this First
Amendment, all terms and conditions of the Severance Agreement are hereby
ratified and shall continue in full force and effect.


6.  Counterparts.  This First Amendment may be executed in
several counterparts, each of which shall constitute an original and all of
which, when taken together, shall constitute one agreement.


7.  Choice of Law.  This First Amendment shall be construed and
enforced in accordance with and be governed by the laws of the State of
California.


IN WITNESS WHEREOF, the parties
hereto have duly executed this First Amendment as of the date first set forth
above.


	
  EMPLOYEE:

  	
   

  	
   

  	
   

  	
  COMPANY:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PAUL K. LAIKIND

  	
   

  	
   

  	
   

  	
  METABASIS THERAPEUTICS, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
    /s/ Paul K. Laikind

  	
   

  	
  By:

  	
   

  	
    /s/ David F. Hale

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
  Chairman of the Board