ex10_1.htm


    Ex.
      10.1

     

    
 


    EMPLOYMENT
      AGREEMENT 

     

    This
      Employment Agreement (“Agreement”), effective as of this 3rd day of August,
      2007, by and between XOMA (US) LLC (“XOMA” or the “Company”), a Delaware limited
      liability company with its principal office at 2910 Seventh Street, Berkeley,
      California, and Steven B. Engle (“Employee”), an individual residing at 14891 De
      La Valle Place, Del Mar, CA  92015.

     

    WHEREAS,
      the Company wishes to enter into this Agreement to assure the Company of the
      continued services of Employee; and

     

    WHEREAS,
      Employee is willing to enter into this Agreement and to continue to serve in
      the
      employ of the Company upon the terms and conditions hereinafter
      provided;

     

    NOW,
      THEREFORE, in consideration of the mutual covenants herein contained, the
      parties hereto hereby agree as follows:

     

    1.  Employment.
      The Company agrees to continue to employ Employee, and Employee agrees to
      continue to be employed by the Company, for the period referred to in Section
      3
      hereof and upon the other terms and conditions herein provided. 

     

    2.  Position
      and Responsibilities. The Company agrees to employ Employee in the
      position of Chief Executive Officer and President and also as Director, and
      Employee agrees to serve as Chief Executive Officer and President and also
      as
      Director, for the term and on the conditions hereinafter set forth. Employee
      agrees to perform such services not inconsistent with his position as shall
      from
      time to time be assigned to him by the Board of Directors of the Company’s
      parent company, XOMA Ltd. (the “Board of Directors”). 

     

    3.  Term
      and Duties. 

     

    (a)  Term
      of Employment. This Agreement shall become effective and the term of
      employment pursuant to this Agreement shall commence on August 3, 2007 and
      will
      continue until August 2, 2008, and will be automatically extended (without
      further action by the parties) for one year thereafter and again on each
      subsequent anniversary thereof unless notice of nonextension of the term is
      given by either the Employee or the Company more than 90 days prior to the
      next
      scheduled expiration date or unless Employee’s employment is terminated by the
      Company or he resigns from the Company’s employ as described
      herein.

     

    (b)  Duties.
      During the period of his employment hereunder Employee shall serve the Company
      as its Chief Executive Officer and President and also as Director, and except
      for illnesses, vacation periods and reasonable leaves of absence, Employee
      shall
      devote all of his business time, attention, skill and efforts to the faithful
      performance of his duties hereunder.  So long as Employee is Chief
      Executive Officer and President and also as Director of the Company, he will
      discharge all duties incidental to such office and such further duties as may
      be
      reasonably assigned to him from time to time by the Board of Directors.


     


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    4.  Compensation
      and Reimbursement of Expenses. 

     

    (a)  Compensation.
      For all services rendered by Employee as Chief Executive Officer and President
      and also as Director during his employment under this Agreement, the Company
      shall pay Employee as compensation a base salary at a rate of not less than
      $495,000.00 per annum. All taxes and governmentally required withholding shall
      be deducted in conformity with applicable laws.

     

    (b)  Reimbursement
      of Expenses. The Company shall pay or reimburse Employee for all reasonable
      travel and other expenses incurred by Employee in performing his obligations
      under this Agreement in a manner consistent with past Company practice. The
      Company further agrees to furnish Employee with such assistance and
      accommodations as shall be suitable to the character of Employee’s position with
      the Company, adequate for the performance of his duties and consistent with
      past
      Company practice.

     

    5.  Participation
      in Benefit Plans. The payments provided in Section 4 hereof are in addition
      to benefits Employee is entitled to under any group hospitalization, health,
      dental care, disability insurance, surety bond, death benefit plan, travel
      and/or accident insurance, other allowance and/or executive compensation plan,
      including, without limitation, any senior staff incentive plan, capital
      accumulation and termination pay programs, restricted or non-restricted share
      purchase plan, share option plan, retirement income or pension plan or other
      present or future group employee benefit plan or program of the Company for
      which key executives are or shall become eligible, and Employee shall be
      eligible to receive during the period of his employment under this Agreement,
      all benefits and emoluments for which key executives are eligible under every
      such plan or program to the extent permissible under the general terms and
      provisions of such plans or programs and in accordance with the provisions
      thereof. 

     

    6.  Payments
      to Employee Upon Termination of Employment. 

     

    (a)  Termination.
      Upon the occurrence of an event of termination (as hereinafter defined) during
      the period of Employee’s employment under this Agreement, the provisions of this
      paragraph 6(a) and paragraph 6(b) shall apply. As used in this Agreement, an
      “event of termination” shall mean and include any one or more of the following:


     

    (i)  The
      termination by the Company of Employee’s employment hereunder for any reason
      other than pursuant to paragraph 6(c) and shall include any termination of
      the Employee’s employment upon expiration of the term of this Agreement due to
      the Company giving written notice of its intention not to extend the term of
      this Agreement as provided in paragraph 3(a); or 

     


    
      
        
        

      

      
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    (ii)  Employee’s
      resignation from the Company’s employ for Good Reason in accordance with the
      terms hereof.  “Good Reason” shall mean, unless remedied by the
      Company within thirty (30) days after the receipt of written notice from the
      Employee as provided below or consented to in writing by the Employee, (A)
      the
      material diminution of any material duties or responsibilities of the Employee;
      or (B) a material reduction in the Employee's base salary;provided, however,
      that the Employee must have given written notice to the Company of the existence
      of any such condition within ninety (90) days after the initial existence
      thereof (and the failure to provide such timely notice will constitute a waiver
      of the Employee’s ability to terminate employment for Good Reason as a result of
      such condition), and the Company will have a period of thirty (30) days from
      receipt of such written notice during which it may remedy the condition;
      provided further, however, that any termination of employment by the Employee
      for Good Reason must occur not later than one hundred eighty (180) days
      following the initial existence of the condition giving rise to such Good
      Reason.

     

    (b)  Severance
      Pay and Other Benefits.   The following provisions of this
      Section 6(b) shall apply upon the occurrence of an event of termination under
      paragraph 6(a).

     


    
      
        
        

      

      
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    (i)  Cash
      Severance Pay.  Upon the occurrence of an event of termination
      under paragraph 6(a), the Company shall, subject to the provisions of Section
      7
      below, pay Employee, or in the event of his subsequent death, his beneficiary
      or
      beneficiaries of his estate, as the case may be, as severance pay or liquidated
      damages, or both, (A) a severance payment in an amount equal to 1.5 times the
      Employee’s annual base salary as in effect immediately prior to the termination,
      and (B) a severance payment equal to the sum of (1) 1.5 times the Employee’s
      annual target bonus as in effect for the fiscal year in which the termination
      occurs, and (2) an amount equal to a pro-rated portion of the Employee’s annual
      target bonus as in effect for the fiscal year in which the termination occurs
      calculated by multiplying the annual target bonus by a fraction, the numerator
      of which shall be the number of calendar months (including a portion of any
      such
      month) that the Employee was employed with the Company  prior to the
      occurrence of the termination during such fiscal year, and the denominator
      of
      which shall be 12.  Such severance payments shall be in lieu of any
      other severance payment to which the Employee shall be entitled as a result
      of
      such termination pursuant to this Agreement, any other employment agreement
      with
      or offer letter from the Company or any of its affiliates or the Company’s or
      any of its affiliate’s then existing severance plans and policies, except in
      those circumstances where the provisions of the Change of Control Severance
      Agreement, effective as of August 3, 2007, between Employee and XOMA Ltd.,
      by
      such agreement’s express terms, apply, in which case the provisions of such
      agreement providing for severance payment(s) to Employee as a result of such
      termination shall apply in lieu of the provisions of this Agreement relating
      thereto.  The severance payment described in Section 6(b)(i)(A) shall
      be paid in monthly installments over eighteen (18) months (the “Severance
      Payment Period”), beginning within thirty (30) days of the termination, and the
      severance payment described in Section 6(b)(i)(B) shall be paid in a lump sum
      within thirty (30) days of the termination, in each case subject to the
      requirements of Section 6(b)(iii) below.

     


    
      
        
        

      

      
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    (ii)  Group
      Health Coverage and Certain Other Benefits.  In addition, during a
      period of eighteen (18) months following an event of termination under paragraph
      6(a), (A) the Company shall pay for the full cost of the coverage (plus an
      additional amount to pay for the taxes on such payments, if any, plus any taxes
      on such additional amount, such amount to be paid no later than ten (10) days
      prior to the date such taxes are due) of the Employee and Employee’s spouse and
      eligible dependents under any group health plans of the Company on the date
      of
      such termination of employment at the same level of health (i.e., medical,
      vision and dental) coverage and benefits as in effect for the Employee or such
      covered dependents on the date immediately preceding the date of the Employee’s
      termination; provided, however, that (1) the Employee and Employee’s spouse and
      eligible dependents each constitutes a qualified beneficiary, as defined in
      Section 4980B(g)(1) of the Internal Revenue Code of 1986, as amended (the
“Code”); and (2) the Employee elects continuation coverage pursuant to the
      Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”),
      within the time period prescribed pursuant to COBRA; and (B) if Employee is,
      at
      the time of such termination, an eligible participant in the Company’s mortgage
      differential program, the Company shall continue to make mortgage assistance
      payments to Employee pursuant to such program as in effect at the time of such
      termination.  Notwithstanding the foregoing, the payments by the
      Company for such group health coverage and/or mortgage assistance, as
      applicable, shall cease prior to the expiration of the eighteen (18) month
      period in this Section 6(b)(ii) upon the employment of the Employment by another
      employer.  Furthermore, if, at the time of the termination of
      Employee’s employment under paragraph 6(a), Employee is the obligor of a
“forgivable” loan (i.e., a loan which by its terms is to be considered forgiven
      by the Company and paid by the obligor in circumstances other than actual
      repayment) from the Company, then, notwithstanding any provisions of such loan
      to the contrary, such loan shall remain outstanding, and the forgiveness thereof
      shall continue, for a period of eighteen (18) months following such termination
      in accordance with the terms of such loan in effect at the time of such
      termination; provided, however, that at the end of such period of
      eighteen (18) months, the outstanding balance of such loan shall be immediately
      due and payable, together with any accrued and unpaid interest
      thereon.

     


    
      
        
        

      

      
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    (iii)  Section
      409A of the Code.  Notwithstanding the foregoing clauses (i) and
      (ii), to the extent any of the severance payments, mortgage assistance payments
      or loan forgiveness referred to therein, or any taxes payable on the health
      benefits referred to therein, would be deemed made in connection with a
“separation from service” within the meaning of the term in Section
      409A(a)(2)(A)(i) of the Code to a “specified employee” within the meaning of the
      term in Section 409A(a)(2)(B)(i) of the Code, and not exempt from the
      requirements of Section 409A of the Code, then such payments or forgiveness,
      as
      the case may be, shall be postponed until six (6) months following the
      Employee’s termination from employment as required by Section 409A of the Code,
provided, however, if prior to the expiration of such six-month
      period, the Employee dies, then such payments or forgiveness, as the case may
      be, shall commence prior to expiration of the six month period according to
      the
      original payment schedule for such payments to the extent permitted by Section
      409A of the Code.  Thus, for example, if the provision in the
      preceding sentence applies, the first six (6) monthly installments of the
      severance payments provided for in clause (i) above shall be paid immediately
      following the six (6) month period in a lump sum and the seventh (7th) through
      eighteenth (18th) installments
      shall be paid according to their original schedule provided that the Employee
      does not die during such six-month period. 

     

    (iv)  Outplacement
      Program.  Upon the occurrence of an event of termination under
      paragraph 6(a), the Employee will immediately become entitled to participate
      in
      a twelve (12) month executive outplacement program provided by an executive
      outplacement service, at the Company’s expense not to exceed fifteen thousand
      dollars ($15,000).

     

    (v)  Release
      of Claims.  As a condition of entering into this Agreement and
      receiving the severance benefits under this Section 6(b), the Employee agrees
      to
      execute and not revoke a release of claims agreement substantially in the form
      attached hereto as Exhibit A upon the termination of the Employee’s
      employment with the Company.  Such release shall not, however, apply
      to the rights and claims of the Employee under this Agreement, any
      indemnification agreement between the Employee and XOMA Ltd. (or its successor
      or acquirer), the bye-laws of XOMA Ltd. (or its successor or acquirer), the
      share award agreements between the Employee and XOMA Ltd. (or its successor
      or
      acquirer), or any employee benefit plan of which the Employee is a participant
      and under which all benefits due under such plan have not yet been paid or
      provided.

     

    (c)  Other
      Termination of Employment. Notwithstanding paragraphs 6(a) and (b) or any
      other provision of this Agreement to the contrary, if on or after the date
      of
      this Agreement and prior to the end of the term hereof:

     

    (i)   Employee
      has been
      convicted of any crime or offense constituting a felony under applicable law,
      including, without limitation, any act of dishonesty such as embezzlement,
      theft
      or larceny;

     


    
      
        
        

      

      
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    (ii)  Employee
      shall act or refrain from acting in respect of any of the duties and
      responsibilities which have been assigned to him in accordance with this
      Agreement and shall fail to desist from such action or inaction within thirty
      (30)  days after Employee’s receipt of notice from the Company of such
      action or inaction and the Board of Directors determines that such action or
      inaction constituted gross negligence or a willful act of malfeasance or
      misfeasance of Employee in respect of such duties; or

     

    (iii)  Employee
      shall breach any material term of this Agreement and shall fail to correct
      such
      breach within thirty (30) days after Employee’s receipt of notice from the
      Company of such breach (provided such breach can be cured); 

     

    then,
      and
      in each such case, the Company shall have the right to give notice of
      termination of Employee’s services hereunder (or pay Employee in lieu of notice)
      as of a date (not earlier than fourteen (14) days from such notice) to be
      specified in such notice and this Agreement (other than the provisions of
      Section 7 hereof) shall terminate on such date. 

     

    7.  Post-Termination
      Obligations. All payments and benefits to Employee under this Agreement
      shall be subject to Employee’s compliance with the following provisions during
      the term of his employment and for the Severance Payment Period: 

     

    (a)  Confidential
      Information and Competitive Conduct. Employee shall not, to the detriment of
      the Company, disclose or reveal to any unauthorized person any trade secret
      or
      other confidential information relating to the Company or its affiliates or
      to
      any businesses operated by them, and Employee confirms that such information
      constitutes the exclusive property of the Company. Employee shall not otherwise
      act or conduct himself to the material detriment of the Company or its
      affiliates, or in a manner which is inimical or contrary to the interests
      thereof, and, for a period of twelve (12) months following an event of
      termination under paragraph 6(a), shall not, directly or indirectly, engage
      in
      or render any service (whether to a person, firm or business) in direct
      competition with the Company; provided, however, that Employee’s
      ownership of less than five percent (5%) of the outstanding stock of a
      corporation shall not be itself be deemed to constitute such competition.
      Employee recognizes that the possible restrictions on his activities which
      may
      occur as a result of his performance of his obligations under this paragraph
      7(a) are required for the reasonable protection of the Company and its
      investments.  For purposes hereof, “in direct competition” means
      engaged in the research, development and/or production of biological materials
      intended for use as therapeutic, prophylactic or diagnostic products in one
      or
      more of the same indications, and that utilize one or more of the same
      scientific bases (e.g., in the case of a therapeutic antibody, targets the
      same
      signal initiating pathway), as a product or product candidate the research,
      development and/or production of which is an active part of the Company’s
      business plan at the time of Employee’s termination.

     


    
      
        
        

      

      
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    (b)  Non-Disparagement.  The
      Employee and the Company agree to refrain from any defamation, libel or slander
      of the other and its respective officers, directors, employees, representatives,
      investors, shareholders, administrators, affiliates, divisions, subsidiaries,
      predecessor and successor corporations and assigns or tortious interference
      with
      the contracts and relationships of the other and its respective officers,
      directors, employees, representatives, investors, shareholders, administrators,
      affiliates, divisions, subsidiaries, predecessor and successor corporations
      and
      assigns. 

     

    (c)  Failure
      of Employee to Comply. If, for any reason other than death or disability,
      Employee shall, without written consent of the Company, fail to comply with
      the
      provisions of paragraphs 7(a) or 7(b) above, his rights to any future payments
      or other benefits hereunder shall terminate, and the Company’s obligations to
      make such payments and provide such benefits shall cease. 

     

    (d)  Remedies.
      Employee agrees that monetary damages would not be adequate compensation for
      any
      loss incurred by the Company by reason of a breach of the provisions of this
      Section 7 and hereby agrees to waive the defense in any action for specific
      performance that a remedy at law would be adequate. 

     

    8.  Effect
      of Prior Agreements. This Agreement contains the entire understanding
      between the parties hereto and supersedes any prior employment agreements
      between the Company and Employee, but shall not supersede the Change of Control
      Severance Agreement referred to above, any indemnification agreement between
      the
      Employee and XOMA Ltd. (or its successor or acquirer), the share award
      agreements between the Employee and XOMA Ltd. (or its successor or acquirer),
      or
      any employee benefit plan of which the Employee is a participant and under
      which
      all benefits due under such plan have not yet been paid or provided.


     

    9.  General
      Provisions. 

     

    (a)  Binding
      Agreement. This Agreement shall be binding upon, and inure to the benefit
      of, Employee and the Company and their respective permitted successors and
      assigns. 

     

    (b)  Legal
      Expenses. In the event that Employee incurs legal expenses in contesting any
      provision of this Agreement and such contest results in a determination that
      the
      Company has breached any of its obligations hereunder, Employee shall be
      reimbursed by the Company for such legal expenses.

     

    (c)  Compliance
      with Section 409A of the Code.  It is intended that this Agreement
      will comply with Section 409A of the Code (and any regulations and guidelines
      issued thereunder) to the extent the Agreement is subject thereto, and the
      Agreement shall be interpreted on the basis consistent with such
      intent.

     


    
      
        
        

      

      
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    10.  Successors
      and Assigns. 

     

    (a)  Assignment
      by the Company. This Agreement shall be binding upon and inure to the
      benefit of the successors and assigns of the Company and, unless clearly
      inapplicable, reference herein to the Company shall be deemed to include its
      successors and assigns. 

     

    (b)  Assignment
      by Employee. Employee may not assign this Agreement in whole or in part.


     

    11.  Modification
      and Waiver. 

     

    (a)  Amendment
      of Agreement. This Agreement may not be modified or amended except by an
      instrument in writing signed by the parties hereto. 

     

    (b)  Waiver.
      No term or condition of this Agreement shall be deemed to have been waived
      except by written instrument of the party charged with such waiver. No such
      written waiver shall be deemed a continuing waiver unless specifically stated
      therein, and each such waiver shall operate only as to the specific term or
      condition waived. 

     

    12.  Severability.
      In the event any provision of this Agreement or any part hereof is held invalid,
      such invalidity shall not affect any remaining part of such provision or any
      other provision. If any court construes any provision of this Agreement to
      be
      illegal, void or unenforceable because of the duration or the area or matter
      covered thereby, such court shall reduce the duration, area or matter of such
      provision, and, in its reduced form, such provision shall then be enforceable
      and shall be enforced. 

     

    13.  Governing
      Law. This Agreement has been executed and delivered in the State of
      California, and its validity interpretation, performance, and enforcement shall
      be governed by the laws of said State.

     

    IN
      WITNESS WHEREOF, XOMA has caused this Agreement to be executed by its duly
      authorized officer, and Employee has signed this Agreement, all as of the day
      and year first above written.

     

    
      	
                                          XOMA
                (US) LLC

               

            
	
               

                                          ________________________________

                                          By:   
                Christopher J. Margolin

                                            
Vice
                President,
                General Counsel

                                              and
                Secretary

               

            
	
              _____________________________

                                          Steven
                B. Engle

               

            


    

    



    
      
        
        

      

      
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    EXHIBIT
      A

     

    FORM
      RELEASE OF CLAIMS AGREEMENT

     

     

    This
      Release of Claims Agreement (this “Agreement”) is made and entered into by and
      between XOMA (US) LLC (the “Company”) and Steven B. Engle (the
“Employee”).

     

    WHEREAS,
      the Employee was employed by the Company; and

     

    WHEREAS,
      the Company and the Employee have entered into an employment agreement effective
      as of August 3, 2007 (the “Employment Agreement”).

     

    NOW
      THEREFORE, in consideration of the mutual promises made herein and other good
      and valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged, the Company and the Employee (collectively referred to as the
      “Parties”) desiring to be legally bound do hereby agree as follows:

     

    1.  Termination.  The
      Employee’s employment with the Company terminated on ___________,
      20__.

     

    2.  Consideration.  Subject
      to and in consideration of the Employee’s release of claims as provided herein,
      the Company has agreed to pay the Employee certain benefits and the Employee
      has
      agreed to provide certain benefits to the Company, both as set forth in the
      Employment Agreement.

     

    3.  Release
      of Claims.  The Employee agrees that the foregoing consideration
      represents settlement in full of all currently outstanding obligations owed
      to
      the Employee by the Company.  The Employee, on the Employee’s own
      behalf and the Employee’s respective heirs, family members, executors and
      assigns, hereby fully and forever releases the Company and its past, present
      and
      future officers, agents, directors, employees, investors, shareholders,
      administrators, affiliates, divisions, subsidiaries, parents, predecessor and
      successor corporations, and assigns, from, and agrees not to sue or otherwise
      institute or cause to be instituted any legal or administrative proceedings
      concerning any claim, duty, obligation or cause of action relating to any
      matters of any kind, whether presently known or unknown, suspected or
      unsuspected, that the Employee may possess arising from any omissions, acts
      or
      facts that have occurred up until and including the Effective Date (as defined
      below) of this Agreement including, without limitation:

     

    (a)  any
      and
      all claims relating to or arising from the Employee’s employment relationship
      with the Company and the termination of that relationship;

     

    (b)  any
      and
      all claims relating to, or arising from, the Employee’s right to purchase, or
      actual purchase of shares of stock of the Company, including, without
      limitation, any claims for fraud, misrepresentation, breach of fiduciary duty,
      breach of duty under applicable state corporate law and securities fraud under
      any state or federal law;

     

    (c)  any
      and
      all claims for wrongful discharge of employment, termination in violation of
      public policy, discrimination, breach of contract (both express and implied),
      breach of a covenant of good faith and fair dealing (both express and implied),
      promissory estoppel, negligent or intentional infliction of emotional distress,
      negligent or intentional misrepresentation, negligent or intentional
      interference with contract or prospective economic advantage, unfair business
      practices, defamation, libel, slander, negligence, personal injury, assault,
      battery, invasion of privacy, false imprisonment and conversion;

     

    (d)  any
      and
      all claims for violation of any federal, state or municipal statute, including,
      but not limited to, Title VII of the Civil Rights Act of 1964, the Civil Rights
      Act of 1991, the Age Discrimination in Employment Act of 1967, the Americans
      with Disabilities Act of 1990, the Fair Labor Standards Act, the Employee
      Retirement Income Security Act of 1974, The Worker Adjustment and Retraining
      Notification Act, the California Fair Employment and Housing Act, and Labor
      Code
      Section 201, et seq. and Section 970, et seq. and all
      amendments to each such Act as well as the regulations issued
      thereunder;

     

    (e)  any
      and
      all claims for violation of the federal or any state constitution;

     

    (f)  any
      and
      all claims arising out of any other laws and regulations relating to employment
      or employment discrimination; and

     

    (g)  any
      and
      all claims for attorneys’ fees and costs.

     

    The
      Employee agrees that the release set forth in this Section 4 shall be and remain
      in effect in all respects as a complete general release as to the matters
      released.  Notwithstanding the foregoing, this release does not extend
      to any obligations now or subsequently incurred under this Agreement, the
      Employment Agreement, the Indemnification Agreement between the Employee and
      the
      Company (or its successor or acquirer), the outstanding stock award agreements
      between the Employee and the Company (or its successor or acquirer), or any
      employee benefit plan of which the Employee is a participant and under which
      all
      benefits due under such plan have not yet been paid or provided.

     

    4.  Acknowledgment
      of Waiver of Claims under ADEA.  The Employee acknowledges that
      the Employee is waiving and releasing any rights the Employee may have under
      the
      Age Discrimination in Employment Act of 1967 (“ADEA”) and that this waiver and
      release is knowing and voluntary.  The Employee and the Company agree
      that this waiver and release does not apply to any rights or claims that may
      arise under the ADEA after the Effective Date of this Agreement.  The
      Employee acknowledges that the consideration given for this waiver and release
      agreement is in addition to anything of value to which the Employee was already
      entitled.  The Employee further acknowledges that the Employee has
      been advised by this writing that (a) the Employee should consult with an
      attorney prior to executing this Agreement; (b) the Employee has at least
      twenty-one (21) days within which to consider this Agreement; (c) the Employee
      has seven (7) days following the execution of this Agreement by the Parties
      to
      revoke the Agreement; and (d) this Agreement shall not be effective until the
      revocation period has expired.  Any revocation should be in writing
      and delivered to the Company by the close of business on the seventh (7th) day from
      the date
      that the Employee signs this Agreement.


    
      
        
        

      

      
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    5.  Civil
      Code Section 1542.  The Employee represents that the Employee is
      not aware of any claims against the Company other than the claims that are
      released by this Agreement.  The Employee acknowledges that the
      Employee has been advised by legal counsel and is familiar with the provisions
      of California Civil Code Section 1542, which provides as follows:

     

    A
      GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW
      OR
      SUSPECT TO EXIST IN HER OR HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
      WHICH
      IF KNOWN BY HER OR HIM MUST HAVE MATERIALLY AFFECTED HER OR HIS SETTLEMENT
      WITH
      THE DEBTOR.

     

    The
      Employee, being aware of said code section, agrees to expressly waive any rights
      the Employee may have thereunder, as well as under any other statute or common
      law principles of similar effect.

     

    6.  No
      Pending or Future Lawsuits.  The Employee represents that the
      Employee has no lawsuits, claims or actions pending in the Employee’s name, or
      on behalf of any other person or entity, against the Company or any other person
      or entity referred to herein.  The Employee also represents that the
      Employee does not intend to bring any claims on the Employee’s own behalf or on
      behalf of any other person or entity against the Company or any other person
      or
      entity referred to herein except, if necessary, with respect to the agreements
      listed in the last sentence of Section 4 of this Agreement.

     

    7.  Confidentiality.  The
      Employee agrees to use the Employee’s best efforts to maintain in confidence the
      existence of this Agreement, the contents and terms of this Agreement, and
      the
      consideration for this Agreement (hereinafter collectively referred to as
“Release Information”).  The Employee agrees to take every reasonable
      precaution to prevent disclosure of any Release Information to third parties
      and
      agrees that there will be no publicity, directly or indirectly, concerning
      any
      Release Information.  The Employee agrees to take every precaution to
      disclose Release Information only to those attorneys, accountants, governmental
      entities and family members who have a reasonable need to know of such Release
      Information.

     

    8.  No
      Adverse Cooperation.  The Employee agrees the Employee will not
      act in any manner that might damage the business of the Company.  The
      Employee agrees that the Employee will not counsel or assist any attorneys
      or
      their clients in the presentation or prosecution of any disputes, differences,
      grievances, claims, charges or complaints by any third party against the Company
      and/or any officer, director, employee, agent, representative, shareholder
      or
      attorney of the Company, unless compelled under a subpoena or other court order
      to do so.

     

    9.  Costs.  The
      Parties shall each bear their own costs, expert fees, attorneys’ fees and other
      fees incurred in connection with this Agreement.


    
      
        
        

      

      
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    10.  Authority.  The
      Company represents and warrants that the undersigned has the authority to act
      on
      behalf of the Company and to bind the Company and all who may claim through
      it
      to the terms and conditions of this Agreement.  The Employee
      represents and warrants that the Employee has the capacity to act on the
      Employee’s own behalf and on behalf of all who might claim through the Employee
      to bind them to the terms and conditions of this Agreement.

     

    11.  No
      Representations.  The Employee represents that the Employee has
      had the opportunity to consult with an attorney, and has carefully read and
      understands the scope and effect of the provisions of this
      Agreement.  Neither party has relied upon any representations or
      statements made by the other party hereto which are not specifically set forth
      in this Agreement.

     

    12.  Severability.  In
      the event that any provision hereof becomes or is declared by a court of
      competent jurisdiction to be illegal, unenforceable or void, this Agreement
      shall continue in full force and effect without said provision.

     

    13.  Entire
      Agreement.  This Agreement and the Employment Agreement and the
      agreements and plans referenced therein represent the entire agreement and
      understanding between the Company and the Employee concerning the Employee’s
      separation from the Company, and supersede and replace any and all prior
      agreements and understandings concerning the Employee’s relationship with the
      Company and the Employee’s compensation by the Company.  This
      Agreement may only be amended in writing signed by the Employee and an executive
      officer of the Company.

     

    14.  Governing
      Law.  This Agreement shall be governed by the internal substantive
      laws, but not the choice of law rules, of the State of California.

     

    15.  Effective
      Date.  This Agreement is effective eight (8)
      days after it has been signed by the Parties (the “Effective Date”) unless it is
      revoked by the Employee within seven (7) days of the execution of this Agreement
      by the Employee.

     

    16.  Counterparts.  This
      Agreement may be executed in counterparts, and each counterpart shall have
      the
      same force and effect as an original and shall constitute an effective, binding
      agreement on the part of each of the undersigned.

     

    17.  Voluntary
      Execution of Agreement.  This Agreement is executed voluntarily
      and without any duress or undue influence on the part or behalf of the Parties
      hereto, with the full intent of releasing all claims.  The Parties
      acknowledge that:

     

    (a)  they
      have
      read this Agreement;

     

    (b)  they
      have
      been represented in the preparation, negotiation and execution of this Agreement
      by legal counsel of their own choice or that they have voluntarily declined
      to
      seek such counsel;

     

    (c)  they
      understand the terms and consequences of this Agreement and of the releases
      it
      contains; and


    
      
        
        

      

      
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    (d)  they
      are
      fully aware of the legal and binding effect of this Agreement.


    
      
        
        

      

      
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    IN
      WITNESS WHEREOF, the Parties have executed this Agreement on the respective
      dates set forth below.

    
      	
               

                                                                                            
                XOMA (US) LLC

                                                                                            

                                                   By: 
                ___________________________          

                                                                                             
                Title:  __________________________

                                                                                             
                Date: __________________________

               

            
	
                                                                                            
                EMPLOYEE

                                                                        
                ___________________________

                                                                                             Name

               

                                                                                            
                Date:  __________________________

               

            


    

    


    


    
 

     

     

     

     

     

     

     

     

     

     

     

     

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