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                                                                   EXHIBIT 10.54

                        SEPARATION AGREEMENT AND RELEASE


     This Separation Agreement and Release (the "Agreement") is entered into as
of January 17, 2003 by and between Deltagen, Inc., a Delaware corporation (the
"Company"), and Michael T. Sember ("Executive") (together "the Parties"). This
Agreement is effective only if it has been executed by the Parties and the
revocation period has expired as set forth in Sections 17(c) and (d) below (the
"Effective Date").

     WHEREAS, Executive was employed by the Company as President and Chief
Operating Officer pursuant to the terms of an employment agreement dated April
22, 2002 and as amended on October 21, 2002 (the "Employment Agreement");

     WHEREAS, the Parties have mutually agreed (i) to terminate their employment
relationship and (ii) that Executive will release the Company from any and all
claims as of the Effective Date; and

     WHEREAS, the Parties have mutually agreed to treat the termination of
employment as eligible for payment of the separation benefits provided under the
Employment Agreement.

     NOW, THEREFORE, in consideration of the mutual promises contained herein,
the Parties agree as follows:

     1.   Termination of Employment. Executive and the Company acknowledge and
agree that Executive's employment with the Company terminated by mutual
agreement effective as of the close of business on December 9, 2002 (the
"Separation Date") and that pursuant to that agreement Executive voluntarily
resigned as an employee, President and Chief Operating Officer, and also
resigned from any other positions or offices with the Company or its affiliates.

     2.   Separation Benefits. In consideration for the release of claims set
forth below and other obligations under this Agreement and in full satisfaction
of its obligations to Executive under the terms of the Employment Agreement, and
provided this Agreement is signed by Executive and not revoked under Section 17
herein, and further provided that Executive remains in full compliance with all
of his obligations to the Company under this Agreement, the Company agrees to
provide the separation benefits specified in Section 3 below to Executive.
Benefits previously provided to Executive shall not be subject to forfeiture
under this Section, but benefits that have not yet been provided (such as, for
example, Executive's ability to exercise his stock options in the future) and
the Company's obligations under this Agreement will be

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subject to cancellation upon written notice to Executive of a material breach of
Executive's obligations or covenants.

     3.   Payments and Benefits.

          (a)  Consideration. As of the Effective Date (or the first business
day after the Effective Date if the Effective Date falls on a weekend or
holiday), the Company will pay to Executive the sum of (i) $380,000 ("Base
Salary"), (ii) $66,500, and (iii) 30% of Base Salary, minus, in each case,
applicable income and employment state and federal withholding taxes due on
these payments and on the forgiveness of the Promissory Note contemplated by
Section 3(c) hereof (the "Severance Payment") as shown in the below table:


     Item                       Gross Amount          Withholding
     ------------------------------------------------------------

     Sum of (i), (ii), (iii)    $560,500.00           $241,584.58

     Note Forgiveness           $642,033.77           $221,180.63
     ------------------------------------------------------------

The cash amount after withholding to be paid to Executive on the Effective Date
will be $97,734.79 (i.e., $560,500.00 - $241,584.58 - $221,180.63). Executive
understands and agrees that the note forgiveness will be reported by the Company
and included in Executive's income for calendar year 2002 (and the aggregate
amount of employment taxes withheld and paid to the applicable tax authorities
for calendar year 2002 shall be $221,180.63 with respect to the note
forgiveness) and the Severance Payment will be reported by the Company and
included in Executive's income for calendar year 2003 (and the aggregate amount
of employment taxes withheld and paid to the applicable tax authorities for
calendar year 2003 shall be $241,584.58 with respect to the Severance Payment).

          (b)  Stock Options. Executive's outstanding stock options shall
continue to be governed by the applicable stock option plan and applicable
option agreement.

          (c)  Promissory Note. The Executive's promissory note, dated June 24,
2002, to pay the Company $630,000 plus interest (the "Promissory Note") is
forgiven as of the Separation Date and Executive shall be responsible for the
payment of all income and employment state and federal taxes resulting from such
forgiveness of $642,033.77.

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          (d)  Benefits. Executive's unused vacation accrued as of the
Separation Date was fully paid out to Executive in cash on the Separation Date.
As of the Separation Date, Executive will not accrue any vacation time.
Executive will also not be eligible to participate in the Company's 401(k) plan,
Employee Stock Purchase Plan or any other Company benefit plan or program after
the Separation Date. Executive may exercise his rights under the Consolidated
Omnibus Budget Reconciliation Act of 1986, as amended ("COBRA"), to continue his
group health coverage, entirely at his own cost, if Executive timely elects to
continue such health coverage and if Executive timely makes required
COBRA-related payments.

          (e)  Housing Relocation. The Company has previously provided Executive
with a statement that summarized Executive's relocation expense reimbursements
and identified various amounts with respect to Executive's income taxes related
to such reimbursements. To the extent that Executive has any valid housing
relocation expenses to be reimbursed with respect to normal closing costs
previously incurred for the purchase of Executive's home in Menlo Park,
California, Executive shall submit such expense reimbursement request with
supporting documentation to the Company by 5:00 PM PST on January 31, 2003.
Payments for reimbursed closing costs that are subject to income taxes shall be
increased by 43% (subject to applicable withholding) as a one-time tax allowance
and Executive understands and agrees that any such taxable payments to Executive
will be reported by the Company and included in Executive's income in the
calendar year of payment.

With respect to Executive's home in Weston, Connecticut (the "CT Home"),
provided Executive consummates a sale of the CT Home to a third party within
nine (9) months after the Effective Date, then the Company shall reimburse
Executive (subject to applicable withholding) for normal closing costs and real
estate broker's commissions related to such sale to the extent such expenses are
not reimbursed by any other employer or third party. Payments for such
Company-reimbursed closing costs that are subject to income taxes shall be
increased by 43% (subject to applicable withholding) as a one-time tax
allowance. Executive shall submit his reimbursement request (with supporting
documentation) to the Company within 30 days after the closing of the sale of
the CT Home. Executive understands and agrees that any such taxable payments to
Executive will be reported by the Company and included in Executive's income in
the calendar year of payment.

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          (f)  Taxes. Any tax obligations of Executive and tax liability
therefore, including any penalties and interest based upon such tax obligation,
that arise from the benefits and payments made to him under this Section 3 shall
be Executive's responsibility and liability. The Company will report each
payment provided (including but not limited to the loan forgiveness and housing
closing costs reimbursements) provided for in this Section 3 on form W-2 for the
tax year in which the payment is made. All payments or benefits made under this
Agreement to Executive shall be subject to applicable tax withholding laws and
regulations. Executive shall be required to fully satisfy any such withholding
as a condition of receipt of any payments or benefits.

     4.   Confidential Information. In addition to applicable law, Executive
agrees to continue to be bound by and comply with the Proprietary Information
and Inventions Agreement that was executed by and between Executive and the
Company and these obligations shall survive the termination of this Agreement.

     5.   Conflicting Obligations. Executive certifies that Executive has no
outstanding agreement or obligation that is in conflict with any of the
provisions of this Agreement, or that would preclude Executive from complying
with the provisions hereof, and further certifies that Executive will not enter
into any such conflicting agreement.

     6.   Non-Disparagement. Each party agrees not to make any unfavorable or
disparaging written or oral remarks about the other or its past or present
officers, affiliates, employees or directors to third parties. However,
Executive acknowledges and agrees that the Company's non-disparagement
obligation pursuant to this Agreement shall extend solely to the actions of the
Company's current or future directors and officers. For purposes of this
Agreement, "Officers" are those persons meeting the definition provided under
Rule 16a-1(f) of the Securities Exchange Act of 1934 as amended. Executive
agrees not to do or say anything that damages or impairs in any way the business
organization, goodwill, or reputation of Company or any of its affiliates or
related entities. If and when the Company receives a request from a potential
employer of Executive for information regarding his employment with the Company,
the Company agrees that, consistent with its corporate policy, it will confirm
only the voluntary nature of Executive's resignation, the dates of his
employment with the Company and his final annual salary and will also direct
such inquirers to the Company's press release that will disclose the Executive's
resignation (substantially in the form attached hereto as Exhibit A).

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     7.   Arbitration and Equitable Relief.

          (a)  Disputes. Except as provided in Section 7(c) below, the Company
and the Executive agree that any dispute or controversy arising under or in
conjunction with this Agreement will be settled exclusively by arbitration in
San Francisco, California. The Company and the Executive will share equally the
expense of the arbitration. Any claim for arbitration shall be filed in writing
with the arbitrator selected by both Parties within three business days after
either party has notified the other in writing that it desires a dispute between
them to be settled by arbitration. In the event the Parties cannot agree on such
arbitrator within such three-day period, each party will select an arbitrator
and inform the other party in writing of such arbitrator's name and address
within two business days after the end of such three-day period and the two
arbitrators so selected will as soon thereafter as possible select a third
arbitrator; provided, however, that in the event of a failure by either party to
select an arbitrator and notify the other party of such selection within the
time period provided above, the arbitrator selected by the other party will be
the sole arbitrator of the dispute. The arbitration hearing will be held within
seven days (or as soon thereafter as possible) after the selection of the
arbitrator. Hearing procedures which will expedite the hearing may be ordered at
the arbitrator's discretion and the arbitrator may close the hearing in his or
her discretion after determining that he/she has heard sufficient evidence. The
decision of the arbitrator will be issued as expeditiously as possible and in no
event later than five business days after the hearing and the decision will be
binding upon the parties and judgment in accordance with that decision may be
entered in any court having jurisdiction therefore.

          (b)  Consent to Personal Jurisdiction. The arbitrator(s) will apply
California law to the merits of any dispute or claim, without deference to
conflicts of law rules. Executive hereby consents to the personal jurisdiction
of the state and federal courts located in California for any action or
proceeding arising from or relating to this Agreement or relating to any
arbitration in which the parties are participants.

          (c)  Equitable Relief. The parties may apply to any court of competent
jurisdiction for a temporary restraining order, preliminary injunction, or other
interim or conservatory relief as necessary, without breach of this arbitration
agreement and without abridgment of the powers of the arbitrator.

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          (d)  Acknowledgment. EXECUTIVE HAS READ AND UNDERSTANDS THIS
AGREEMENT, WHICH DISCUSSES ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING
THIS AGREEMENT, EXECUTIVE AGREES TO SUBMIT ANY CLAIMS ARISING OUT OF, RELATING
TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY,
CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATION THEREOF, TO BINDING
ARBITRATION, EXCEPT AS PROVIDED IN SECTION 7(c), AND THAT THIS ARBITRATION
CLAUSE CONSTITUTES A WAIVER OF EXECUTIVE'S RIGHT TO A JURY TRIAL AND RELATES TO
THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE RELATIONSHIP
BETWEEN THE PARTIES.

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

     9.   Attorney's Fees. In any action brought by one of the parties to
enforce or interpret the provisions of this Agreement, the prevailing party will
be entitled to reasonable attorney's fees, in addition to any other relief to
which that party may be entitled under this Agreement. The Company shall pay for
50% of Executive's reasonable legal fees incurred prior to the Effective Date
with respect to the review and negotiation of this Agreement (up to a maximum
total fee limit of $10,000 and where the Company's portion would be no greater
than $5,000). Executive shall submit invoices for any such legal fees to the
Company and such invoices shall provide sufficient documentation of the work
performed without violating client confidences. Any legal fees in excess of
$10,000 shall entirely be the responsibility of the Executive.

     10.  Assignment. This Agreement and all rights under this Agreement will be
binding upon and inure to the benefit of and be enforceable by the Parties
hereto and their respective owners, agents, officers, stockholders, employees,
directors, attorneys, subsidiaries, parents, affiliates, successors, personal or
legal representatives, executors, administrators, heirs, distributes, devisees,
legatees, and assigns. This Agreement is personal in nature, and neither of the
Parties to this Agreement will, without the written consent of the other, assign
or transfer this Agreement or any right or obligation under this Agreement to
any other person or entity; except that the rights and obligations of the
Company under this Agreement may be assigned (without the consent of the
Executive) to an entity which becomes the successor to the Company as the

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result of a merger or other corporate reorganization or sale of substantially
all the assets to a successor which continues the business of the Company or any
other subsidiary of the Company, provided, that such assignment will not relieve
the Company of its obligations hereunder.

     11.  Notices. For purposes of this Agreement, notices and other
communications provided for in this Agreement will be in writing and will be
delivered personally or sent by United States certified mail, return receipt
requested, postage prepaid, addressed as follows:

     If to the Executive:       Michael T. Sember
                                348 Lennox Avenue
                                Menlo Park, CA 94025

     with a copy to:            Jeffrey Englander, Esq.
                                Morrison Cohen Singer & Weinstein, LLP
                                750 Lexington Avenue
                                New York, New York 10022

     If to the Company:         Deltagen, Inc.
                                740 Bay Road
                                Redwood City, CA 94063
                                Attn: Board of Directors

     with a copy to:            Alan Talkington, Esq.
                                Orrick, Herrington & Sutcliffe LLP
                                400 Sansome Street
                                San Francisco, CA 94111

or to such other address or the attention of such other person as the recipient
party has previously furnished to the other party in writing in accordance with
this Section 11. Such notices or other communications will be effective upon
delivery or, if earlier, three days after they have been mailed as provided
above.

     12.  Integration. This Agreement, the Executive's stock option and common
stock purchase agreements with the Company, and the Proprietary Information and
Inventions Agreement represent the entire agreement and understanding between
the parties as to the subject matter hereof and supersede all prior agreements
(including but not limited to the Employment Agreement and the Promissory Note)
whether written or oral.

     13.  Modification. This Agreement may only be amended in a writing signed
by Executive and the Chairman of the Board of Directors of the Company. No
waiver, alteration, or modification of any of the provisions of this Agreement
will be binding unless in writing and

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signed by the party against whom enforcement of the change or modification is
sought. Failure or delay on the part of either party hereto to enforce any
right, power, or privilege hereunder will not be deemed to constitute a waiver
thereof. Additionally, a waiver by either party or a breach of any promise
hereof by the other party will not operate as or be construed to constitute a
waiver of any subsequent waiver by such other party.

     14.  Right to Advice of Counsel. Executive acknowledges that he has had the
opportunity to fully review this Agreement and, if he so chooses, to consult
with counsel, and is fully aware of his rights and obligations under this
Agreement.

     15.  Civil Code Section 1542. Executive represents that he is not aware of
any claim other than the claims that are released by this Agreement. Executive
also represents that he does not presently intend to bring any claims on his own
behalf or on behalf of any other person or entity against any other person or
entity referred to herein. Executive acknowledges that he 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 HIS FAVOR AT THE TIME OF EXECUTING THE
          RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
          SETTLEMENT WITH THE DEBTOR.

Executive, being aware of said Code section, agrees to expressly waive any
rights he may have thereunder, as well as under any other statute or common law
principles of similar effect.

     16.  Executive's Covenants.

          (a)  General. The Executive agrees that for all periods described in
this Agreement, he shall conduct himself reasonably with respect to the Company
and its employees, directors, stockholders, consultants, customers, affiliates
and agents. Executive shall also provide the Company with itemized receipts for
his business expenses incurred as of the Separation Date as soon as practicable
but in no event later than 5:00 PM PST on January 31, 2003.

          (b)  Confidentiality of this Agreement. Each party agrees to use
his/its reasonable 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 "Separation
Information"). Each party hereto agrees to take every reasonable precaution to

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prevent disclosure of any Separation Information to third parties, except for
disclosures required by law or necessary to effectuate the terms of this
Agreement.

          (c)  Cooperation. Executive shall fully cooperate in the defense of
any action brought by any third party against the Company that relates in any
way to Executive's acts or omissions while employed by the Company or in the
defense of any action brought by any third party relating to litigation pending
against the Company as of the Separation Date.

          (d)  Company Resources. As of the Separation Date, Executive will no
longer represent that he is an officer or employee of the Company. No later than
the Effective Date, Executive will return all Company property to the Company
including but not limited to Confidential Information, credit cards, telephone
calling cards, keys, computers, cell phones, pagers, monitors, business cards,
devices, records, data, notes, reports, proposals, lists, correspondence,
specifications, drawings, blueprints, sketches, laboratory notebooks, flow
charts, materials, equipment, other documents or property, or copies or
reproductions of any aforementioned items belonging to the Company. Executive
will also no longer utilize any Company property.

          (e)  Non-Solicitation. Executive agrees that for one year from the
Effective Date he shall not either directly or indirectly knowingly solicit,
induce, recruit or encourage any of the Company's employees or consultants to
terminate their relationship with the Company, or attempt to solicit, induce,
recruit, encourage any of the Company's employees or consultants to terminate
their relationship with the Company, or attempt to solicit, induce, recruit,
encourage or take away employees or consultants of the Company, either for
himself or for any other person or entity. Further, for the same time period
Executive shall not attempt to negatively influence any of the Company's clients
or customers from purchasing Company products or services or to solicit or
influence or attempt to influence any client, customer or other person either
directly or indirectly, to direct his or its purchase of products and/or
services to any person, firm, corporation, institution or other entity in
competition with the business of the Company.

          (f)  No Further Employment. Executive understands and agrees that he
is not entitled to any further or future employment with the Company or further
or future compensation and/or payments of any kind from the Company other than
those specifically provided for under this Agreement. Executive warrants and
represents that he shall not hereafter reapply for or otherwise seek any
position of employment with the Company and he shall not institute or

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participate in any claim, action, lawsuit or proceeding against the Company for
any failure to employ or re-employ him after the Effective Date.

          (g)  Breach of Agreement. Executive acknowledges that upon material
breach of any provision of this Agreement, the Company would sustain irreparable
harm from such breach, and, therefore, Executive agrees that in addition to any
other remedies which the Company may have for any material breach of this
Agreement or otherwise, the Company shall be entitled to obtain equitable relief
including specific performance and injunctions restraining the Executive from
committing or continuing any such violation of this Agreement.

     17.  Executive's Release of Claims. In exchange for the Company's promises
set forth herein, all of which are good and valuable consideration, Executive
hereby agrees not to sue and releases and forever discharges the Company, its
agents, employees, shareholders, directors, officers and successors of and from
any and all rights, claims, actions, demands, causes of action, obligations,
attorneys' fees, costs, damages, and liabilities of whatever kind or nature, in
law or in equity, that Executive may have (whether known or not known) (except
for his claims to indemnification to the extent permitted under the Company's
bylaws or pre-existing indemnification agreements or as permitted by California
law or as may be available to Executive under the Company's directors' and
officers' liability insurance coverage) (collectively, "Claims"), accruing to
him as of the Effective Date, that he has ever had, including but not limited to
Claims based on and/or arising under Title VII of the Civil Rights Act of 1964,
as amended, The Americans with Disabilities Act, The Family Medical Leave Act,
The Equal Pay Act, The Employee Retirement Income Security Act, The Fair Labor
Standards Act, and/or the California Fair Employment and Housing Act; The
California Constitution, The California Government Code, The California Labor
Code, The Industrial Welfare Commission's Orders, The Securities Act of 1933,
The Securities Exchange Act of 1934 and any and all other Claims he may have
under any other federal, state or local Constitution, Statute, Ordinance and/or
Regulation; and all other Claims arising under common law including but not
limited to tort, express and/or implied contract and/or quasi-contract, arising
out of or, in any way, related to Executive's previous relationship with the
Company as an employee or director. Furthermore, Executive acknowledges that he
is waiving and releasing any rights he may have under the Age Discrimination in
Employment Act of 1967 ("ADEA"), as amended, and that this waiver and release is
knowing and voluntary. Executive acknowledges that the consideration given for
this

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waiver and release is in addition to anything of value to which Executive was
already entitled. Executive further acknowledges that he has been advised by
this writing that:

          (a)  he should consult with an attorney prior to executing this
          Agreement;

          (b)  he has at least twenty-one (21) days within which to consider
          this Agreement;

          (c)  he has up to 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
          in Section 17(c) has expired.

     The Company and Executive agree that the release set forth in this Section
17 shall be and remain in effect in all respects as a complete general release
as to the matters released.

     18.  Labor Code Section 206.5. Executive agrees that the Company has paid
to Executive his salary and vacation accrued as of the Separation Date and that
these payments represent all such monies due to Executive through the Effective
Date. In light of the payment by the Company of all wages due, or to become due
to Executive, California Labor Code Section 206.5 is not applicable to the
Parties hereto. That section provides in pertinent part as follows:

          No employer shall require the execution of any release of any claim or
          right on account of wages due, or to become due, or made as an advance
          on wages to be earned, unless payment of such wages has been made.

     19.  Severability. Whenever possible, each provision of this Agreement will
be interpreted in such a 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 provision had never been contained herein.

     20.  Counterparts. This Agreement may be executed in counterparts, each of
which will be deemed an original, and which together will be a single
instrument.

     21.  No Representations. Each Party represents that it has had the
opportunity to consult with an attorney, and has carefully read and understands
the scope and effect of the

<PAGE>

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.

     22.  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.
Executive represents and warrants that he has the capacity to act on his own
behalf and on behalf of all who might claim through him to bind them to the
terms and conditions of this Agreement. Each Party warrants and represents that
there are no liens or claims of lien or assignments in law or equity or
otherwise of or against any of the claims or causes of action released herein.

     23.  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;

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

     IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the day and year first above written.

MICHAEL T. SEMBER, EXECUTIVE            DELTAGEN, INC.


By: ______________________________      By: ___________________________________

                                        Name: _________________________________

                                        Title: ________________________________

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                                    EXHIBIT A

                              Form of Press Release

                    Deltagen Announces Management Transitions

     REDWOOD CITY, Calif., January xx, 2003 - Deltagen, Inc. (Nasdaq: DGEN)
today announced that the company has accepted the resignation of Michael T.
Sember. Mr. Sember resigned his position as Deltagen's president and chief
operating officer to pursue other interests and the Company wishes him well in
his future endeavors.