**Exhibit10.89**

 

**ABGENIX,INC.**

 

**CHANGE OF CONTROL SEVERANCE AGREEMENT**

 

This Change of ControlSeverance Agreement (the “Agreement”) is made and entered into effective as of August 30,2004 (the “Effective Date”), by and between William R. Ringo (the “Employee”)and Abgenix, Inc., a Delaware corporation (the “Company”).  Certain capitalized terms used in thisAgreement are defined in Section 1 below.

 

RECITALS

 

A.                                   Itis expected that the Company from time to time will consider the possibility ofa Change of Control.  The Board ofDirectors of the Company (the “Board”) recognizes that such consideration canbe a distraction to the Employee and can cause the Employee to consideralternative employment opportunities.

 

B.                                     TheBoard believes that it is in the best interests of the Company and itsshareholders to provide the Employee with an incentive to continue hisemployment and to maximize the value of the Company upon a Change of Controlfor the benefit of its shareholders.

 

C.                                     Inorder to provide the Employee with enhanced financial security and sufficientencouragement to remain with the Company notwithstanding the possibility of aChange of Control, the Board believes that it is imperative to provide theEmployee with certain severance benefits upon the Employee’s termination ofemployment following a Change of Control.

 

AGREEMENT

 

In consideration of themutual covenants herein contained and the continued employment of Employee bythe Company, the parties agree as follows:

 

1.             Definition of Terms.  The following terms referred to in thisAgreement shall have the following meanings:

 

## (a)                                  Cause.  “Cause” shall mean (i) any act ofpersonal dishonesty taken by the Employee in connection with hisresponsibilities as an employee which is intended to result in substantialpersonal enrichment of the Employee, (ii) Employee’s conviction of afelony which the Board reasonably believes has had or will have a materialdetrimental effect on the Company’s reputation or business, (iii) awillful act by the Employee which constitutes misconduct and is injurious tothe Company, and (iv) continued willful violations by the Employee of theEmployee’s obligations to the Company after there has been delivered to theEmployee a written demand for performance from the Company which describes thebasis for the Company’s belief that the Employee has not substantiallyperformed his duties.

 

## (b)                                 Changeof Control.  “Change of Control”shall mean the occurrence of any of the following events:

 

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## (i)                                                        theapproval by shareholders of the Company of a merger or consolidation of theCompany with any other corporation, other than a merger or consolidation whichwould result in the voting securities of the Company outstanding immediatelyprior thereto continuing to represent (either by remaining outstanding or bybeing converted into voting securities of the surviving entity) more than fiftypercent (50%) of the total voting power represented by the voting securities ofthe Company or such surviving entity outstanding immediately after such merger orconsolidation;

 

## (ii)                                                     anyapproval by the shareholders of the Company of a plan of complete liquidationof the Company or an agreement for the sale or disposition by the Company ofall or substantially all of the Company’s assets;

 

## (iii)                                                  any “person”(as such term is used in Sections 13(d) and 14(d) of the SecuritiesExchange Act of 1934, as amended) becoming the “beneficial owner” (as definedin Rule 13d-3 under said Act), directly or indirectly, of securities ofthe Company representing 50% or more of the total voting power represented bythe Company’s then outstanding voting securities; or

 

## (iv)                                                 achange in the composition of the Board, as a result of which fewer than amajority of the directors are Incumbent Directors.  “Incumbent Directors” shall mean directorswho either (A) are directors of the Company as of the date hereof, or(B) are elected, or nominated for election, to the Board with theaffirmative votes of at least a majority of those directors whose election ornomination was not in connection with any transaction described insubsections (i), (ii) or (iii) or in connection with an actual orthreatened proxy contest relating to the election of directors of the Company.

 

## (c)                                  CompensationContinuation Period.  “CompensationContinuation Period” shall mean the period of time commencing with terminationof the Employee’s employment as a result of Involuntary Termination at any timewithin twenty four (24) months after a Change of Control and ending with thedate twenty-four (24) months following the date of the Employee’s termination.

 

## (d)                                 InvoluntaryTermination.  “InvoluntaryTermination” shall mean (i) without the Employee’s express writtenconsent, a significant reduction of the Employee’s duties, position orresponsibilities relative to the Employee’s duties, position orresponsibilities in effect immediately prior to such reduction, or the removalof the Employee from such position, duties and responsibilities, unless theEmployee is provided with comparable duties, position and responsibilities;(ii) without the Employee’s express written consent, a substantialreduction, without good business reasons, of the facilities and perquisites(including office space and location) available to the Employee immediatelyprior to such reduction; (iii) a reduction by the Company of the Employee’sbase salary or target bonus as in effect immediately prior to such reduction;(iv) a material reduction by the Company in the kind or level of employeebenefits to which the Employee is entitled immediately prior to such reductionwith the result that the Employee’s overall benefits package is significantlyreduced; (v) without the Employee’s express written consent, therelocation of the Employee to a facility or a location more than thirty-five(35) miles from his current location; (vi) any purported termination ofthe Employee by the Company which is not effected for Cause or

 

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## for which thegrounds relied upon are not valid; or (vii) the failure of the Company toobtain the assumption of this Agreement by any successors contemplated in Section 6below.

 

2.                                       Termof Agreement.  This Agreement shallterminate upon the date that all obligations of the parties hereto under thisAgreement have been satisfied.

 

# 3.                                       At-WillEmployment.  The Company and theEmployee acknowledge that the Employee’s employment is and shall continue to beat-will, as defined under applicable law. If the Employee’s employment terminates for any reason, the Employeeshall not be entitled to any payments, benefits, damages, awards orcompensation other than as provided by this Agreement, or as may otherwise beestablished under the Company’s then existing employee benefit plans orpolicies at the time of termination.

 

# 4.                                       Changeof Control and Severance Benefits.

 

## (a)                                  TerminationFollowing A Change of Control.

 

### (i)                                          SeverancePayments.  If the Employee’semployment with the Company terminates as a result of an InvoluntaryTermination at any time within twenty four (24) months after a Change of Control,then the Employee shall be entitled to receive continuing payments of severancepay during the Compensation Continuation Period at a rate equal to one hundred(100)% of the Employee’s base salary and target bonus (as in effect immediatelyprior to the Change of Control).  Suchseverance payments shall be paid bi-weekly in accordance with the Company’snormal payroll practices. In addition, during the Compensation ContinuationPeriod, the Company shall continue to make available to the Employee and Employee’sspouse and dependents covered under any group health plans or life insuranceplans of the Company on the date of such termination of employment, all grouphealth, life and other similar insurance plans in which Employee or suchCovered Dependents participate on the date of the Employee’s termination.

 

### (ii)                                       OptionAcceleration.  If the Employee’semployment with the Company terminates as a result of an InvoluntaryTermination at any time within twenty four (24) months after a Change ofControl, then each option granted to the Employee by the Company (the “Options”)shall immediately become vested and exercisable in full.

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### (iii)                                    OtherTermination.  If the Employee’semployment with the Company terminates other than as a result of an InvoluntaryTermination at any time within twenty four (24) months after a Change ofControl, then the Employee shall not be entitled to receive severance or otherbenefits hereunder, but may be eligible for those benefits (if any) as may thenbe established under the Company’s then existing severance and benefits plansand policies at the time of such termination.

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## (b)                                 TerminationApart from a Change of Control.  Ifthe Employee’s employment with the Company terminates for any or no reasonother than within twenty four (24) months following a Change of Control, thenthe Employee shall not be entitled to receive severance or other benefitshereunder, but may be eligible for those benefits (if any) as may then beestablished under

 

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## the Company’s thenexisting severance and benefits plans and policies at the time of suchtermination.

 

## (c)                                  AccruedWages and Vacation; Expenses. Without regard to the reason for, or the timing of, Employee’stermination of employment:  (i) theCompany shall pay the Employee any unpaid base salary due for periods prior tothe date of termination; (ii) the Company shall pay the Employee all ofthe Employee’s accrued and unused vacation through the date of termination; and(iii) following submission of proper expense reports by the Employee, theCompany shall reimburse the Employee for all expenses reasonably andnecessarily incurred by the Employee in connection with the business of theCompany prior to the date of termination. These payments shall be made promptly upon termination and within theperiod of time mandated by law.

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## 5.                                       GoldenParachute Excise Tax Gross-Up.  Inthe event that the severance and other benefits provided for in this Agreementor otherwise payable to Employee constitute “excess parachute payments” withinthe meaning of Section 280G of the Internal Revenue Code of 1986, asamended (the “Code”), and will be subject to the excise tax imposed by Section 4999of the Code (the “Excise Tax”), then Employee shall receive (i) a paymentfrom the Company sufficient to pay the Excise Tax, and (ii) an additionalpayment from the Company sufficient to pay the Excise Tax arising from thepayments made by the Company to Employee pursuant to this sentence.  Unless the Company and Employee otherwise agreein writing, the determination of Employee’s Excise Tax liability and the amountrequired to be paid under this Section 5 shall be made in writing by theCompany’s independent public accountants (the “Accountants”).  In the event that the Excise Tax incurred byEmployee is determined by the Internal Revenue Service to be greater or lesserthan the amount determined by the Accountants, the Company and Employee agreeto promptly make such additional payment, including interest and any taxpenalties, to the other party as the Accountants reasonably determine isappropriate to ensure that the net economic effect to Employee under this Section 5,on an after-tax basis, is as if the Excise Tax did not apply to Employee.  For purposes of making the calculations requiredby this Section 5, the Accountants may make reasonable assumptions andapproximations concerning applicable taxes and may rely on reasonable, goodfaith interpretations of the Code.  TheCompany and Employee shall furnish to the Accountants such information anddocuments as the Accountants may reasonably request in order to make adetermination under this Section.  TheCompany shall bear all costs the Accountants may reasonably incur in connectionwith any calculations contemplated by this Section 5.

 

Thegross-up payment to which Employee is entitled hereunder shall be paid by theCompany to Employee, in cash and in full, not later than thirty (30) calendardays following the date Employee becomes subject to the Excise Tax.

 

# 6.                                       Successors.

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## (a)                                  Company’sSuccessors.  Any successor to theCompany (whether direct or indirect and whether by purchase, lease, merger,consolidation, liquidation or otherwise) to all or substantially all of theCompany’s business and/or assets shall assume the Company’s obligations underthis Agreement and agree expressly to perform the Company’s obligations underthis Agreement in the same manner and to the same extent as the Company wouldbe required to perform

 

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## such obligationsin the absence of a succession.  For allpurposes under this Agreement, the term “Company” shall include any successorto the Company’s business and/or assets which executes and delivers theassumption agreement described in this subsection (a) or which becomesbound by the terms of this Agreement by operation of law.

 

## (b)                                 Employee’sSuccessors.    Without the writtenconsent of the Company, Employee shall not assign or transfer this Agreement orany right or obligation under this Agreement to any other person or entity.Notwithstanding the foregoing, the terms of this Agreement and all rights ofEmployee hereunder shall inure to the benefit of, and be enforceable by,Employee’s personal or legal representatives, executors, administrators,successors, heirs, distributees, devisees and legatees.

 

# 7.                                       Notices.

 

## (a)                                  General.  Notices and all other communicationscontemplated by this Agreement shall be in writing and shall be deemed to havebeen duly given when personally delivered or when mailed by U.S. registered orcertified mail, return receipt requested and postage prepaid.  In the case of the Employee, mailed noticesshall be addressed to him at the home address that he most recentlycommunicated to the Company in writing. In the case of the Company, mailed notices shall be addressed to itscorporate headquarters, and all notices shall be directed to the attention ofits Secretary.

 

## (b)                                 Noticeof Termination.  Any termination bythe Company for Cause or by the Employee as a result of a voluntary resignationor an Involuntary Termination shall be communicated by a notice of terminationto the other party hereto given in accordance with this Section.  Such notice shall indicate the specifictermination provision in this Agreement relied upon, shall set forth inreasonable detail the facts and circumstances claimed to provide a basis fortermination under the provision so indicated. The failure by the Employee to include in the notice any fact orcircumstance which contributes to a showing of Involuntary Termination shallnot waive any right of the Employee hereunder or preclude the Employee fromasserting such fact or circumstance in enforcing his rights hereunder.

 

# 8.                                       Arbitration.

 

## (a)                                  Exceptas provided in Section 8(d) below, any dispute or controversy arising outof, relating to, or in connection with this Agreement, or the interpretation,validity, construction, performance, breach, or termination thereof, shall besettled by binding arbitration to be held in Palo Alto, California, inaccordance with the National Rules for the Resolution of Employment Disputesthen in effect of the American Arbitration Association (the “Rules”).  The arbitrator may grant injunctions or otherrelief in such dispute or controversy. The decision of the arbitrator shall be final, conclusive and binding onthe parties to the arbitration.  Judgmentmay be entered on the arbitrator’s decision in any court having jurisdiction.

 

## (b)                                 Thearbitrator(s) shall apply California law to the merits of any dispute or claim,without reference to conflicts of law rules. The arbitration proceedings shall be governed by

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## federalarbitration law and by the Rules, without reference to state arbitrationlaw.  Employee hereby consents to thepersonal jurisdiction of the state and federal courts located in California forany action or proceeding arising from or relating to this Agreement or relatingto any arbitration in which the parties are participants.

 

## (c)                                  Employeeunderstands that nothing in this Section modifies Employee’s at-willemployment status.  Either Employee orthe Company can terminate the employment relationship at any time, with orwithout cause.

 

## (d)                                 EMPLOYEEHAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES ARBITRATION.  EMPLOYEE UNDERSTANDS THAT SUBMITTING ANYCLAIMS ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, ORTHE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATIONTHEREOF TO BINDING ARBITRATION TO THE EXTENT PERMITTED BY LAW, AND THAT THISARBITRATION CLAUSE CONSTITUTES A WAIVER OF EMPLOYEE’S RIGHT TO A JURY TRIAL ANDRELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THEEMPLOYER/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, THE FOLLOWINGCLAIMS:

 

### (i)                                          ANYAND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT; BREACH OF CONTRACT, BOTHEXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD FAITH AND FAIR DEALING,BOTH EXPRESS AND IMPLIED; NEGLIGENT OR INTENTIONAL INFLICTION OF EMOTIONALDISTRESS; NEGLIGENT OR INTENTIONAL MISREPRESENTATION; NEGLIGENT OR INTENTIONALINTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC ADVANTAGE; AND DEFAMATION.

 

### (ii)                                       ANYAND 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, THECIVIL RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THEAMERICANS WITH DISABILITIES ACT OF 1990, THE FAIR LABOR STANDARDS ACT, THECALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, AND LABOR CODE SECTION 201, *et seq*;

 

### (iii)                                    ANY AND ALL CLAIMSARISING OUT OF ANY OTHER LAWS AND REGULATIONS RELATING TO EMPLOYMENT OREMPLOYMENT DISCRIMINATION.

 

# 9.                                       MiscellaneousProvisions.

 

## (a)                                  NoDuty to Mitigate.  The Employee shallnot be required to mitigate the amount of any payment contemplated by thisAgreement, nor shall any such payment be reduced by any earnings that theEmployee may receive from any other source.

 

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## (b)                                 Waiver.  No provision of this Agreement may bemodified, waived or discharged unless the modification, waiver or discharge isagreed to in writing and signed by the Employee and by an authorized officer ofthe Company (other than the Employee). No waiver by either party of any breach of, or of compliance with, anycondition or provision of this Agreement by the other party shall be considereda waiver of any other condition or provision or of the same condition orprovision at another time.

 

## (c)                                  Integration.  This Agreement and the stock option agreementsrepresenting the Options represent the entire agreement and understandingbetween the parties as to the subject matter herein and supersede all prior orcontemporaneous agreements, whether written or oral.

 

## (d)                                 Choiceof Law.  The validity, interpretation,construction and performance of this Agreement shall be governed by theinternal substantive laws, but not the conflicts of law rules, of the State ofCalifornia.

 

## (e)                                  Severability.  The invalidity or unenforceability of anyprovision or provisions of this Agreement shall not affect the validity orenforceability of any other provision hereof, which shall remain in full forceand effect.

 

## (f)                                    EmploymentTaxes.  All payments made pursuant tothis Agreement shall be subject to withholding of applicable income andemployment taxes.

 

## (g)                                 Counterparts.  This Agreement may be executed incounterparts, each of which shall be deemed an original, but all of whichtogether will constitute one and the same instrument.

 

IN WITNESS WHEREOF, eachof the parties has executed this Agreement, in the case of the Company by itsduly authorized officer, as of the day and year first above written.

 
| COMPANY:  |   | **ABGENIX, INC.**    |
|-----------|--------|----------------------|
|      |   |                 |   |
|      |   | By:                  | /s/ R. Scott Greer |   |
|      |   |                 |   |   |
|      |   | Title:               |   | Chairman |
|      |   |                 |   |
|      |   |                 |   |
| EMPLOYEE: |   | /s/ William R. Ringo |   |
|      |   |                 | William R. Ringo |
|           |        |                      |  |  |  |  |  |  |  |

 

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