Exhibit 10.16




SEPARATION
AGREEMENT




RECITALS




This
Severance Agreement and Release (“Agreement”) is made by and between Jeffrey
Carr (“Employee”) and Taleo Corporation and all its heirs, successors, insurers,
employers, employees, officers, directors, shareholders and agents (hereinafter
collectively referred to as “the Company”) (Employee and the Company are
collectively referred to as the “Parties”.):




WHEREAS,
Employee’s employment terminates with the Company effective May 5,
2008;




WHEREAS,
Employee is not aware of any work-related injury or illness that has not already
been disclosed to the Company;




WHEREAS,
Employee represents that he has not initiated, and is not aware, of any action
in any forum, including any state or federal court or agency, on Employee’s
behalf that involves the Company;




WHEREAS,
Employee represents that he has returned or will return all Company property
within five (5) days from the Termination Date;




WHEREAS,
in exchange for severance pay, and the additional covenants and conditions set
forth below, Employee agrees to release the Company from any claims arising from
or related to the employment relationship;




WHEREAS,
Employee wishes to resolve any and all disputes, claims, complaints, grievances,
charges, actions, petitions and demands that he may have against the Company,
including, but not limited to, any and all claims arising or in any way related
to Employee’s employment with, or separation from, the Company;




WHEREAS,
Employee also understands that in order to receive severance pay under this
Agreement, Employee must sign and return this Agreement to the Company on or
before twenty (21) days from Employee’s receipt of this Agreement and Employee
must not revoke this Agreement.




NOW
THEREFORE, in consideration of the promises made herein, the Parties hereby
agree as follows:




COVENANTS




1. 
Deadline to Accept
Terms of This Agreement.  Employee understands that he will not
receive the benefits set forth in this Agreement unless he delivers a fully
executed copy of this Agreement to the Company’s designated HR
representative on or before twenty-one (21) days from Employee’s receipt of this
Agreement.




2. 
Termination
Date.  The effective date of Employee’s termination of
employment from the Company is May 5, 2008 (“Termination
Date”).





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3. 
Consideration for
Release of Claims.  In consideration for the execution by
Employee of a general release, the Company agrees to the following:




a) 
Severance.  To
pay Employee severance pay in a lump sum equivalent to $166,444.00, less
applicable state and federal required withholding amounts, and other lawful
deductions within ten (10) business days from the date on which the original
fully executed Agreement is received by Company.  In addition to the
above, bonus for the first quarter of 2008 will be paid on the basis of target
attainment consistent with Taleo’s incentive compensation plan for executive
officers.




(b) 
Benefits.  Employee
shall have the right to convert Employee’s health insurance benefits to
individual coverage pursuant to the Consolidated Omnibus Budget Reconciliation
Act of 1985, as amended (“COBRA”) following the last date of Employee’s
employment with Taleo.  Employee agrees to complete and return
Employee’s COBRA application to Taleo’s human resource department during the
time period provided by law.  Taleo shall reimburse all premiums for
the six (6) month period directly following Employee’s Termination Date through
October 31, 2008, should Employee elect continuation coverage under
COBRA.  If Employee secures health insurance through any other source
during this time period, Employee shall so inform Taleo promptly and Taleo’s
obligation to reimburse Employee’s premium shall cease.  Other than as
set forth in this Section, during and subsequent to the Payment Period, Employee
will not be entitled to accrual of any employee benefits, including but not
limited to, vacation benefits.




(c) 
Stock
Options.Employee will receive immediate vesting with respect
to the number of options that would have vested in accordance with Employee’s
then-current stock option grants had Employee remained employed for an
additional six (6) months and, if applicable, Taleo’s right of repurchase shall
continue to lapse in accordance with Employee’s then-current restricted stock
grants for a period of six (6) months from the Termination
Date.  Employee’s vested stock options as of the Termination Date
shall be exercisable for six (6) months after the Termination
Date.  Notwithstanding the foregoing, in no case shall any option be
exercisable after the expiration of its term.  Stock options are
exercisable pursuant to the Taleo Stock Option Plan.




(d) 
Tax
Indemnification.  Employee acknowledges and agrees that the
Company has made no representations or warranties regarding the tax consequences
of any amounts paid by the Company to Employee pursuant to this
Agreement.  Employee agrees to pay all federal or state taxes owed by
Employee, if any, which are required by law to be paid with respect to the
payments herein.  Employee further agrees to indemnify and hold the
Company harmless from any taxes owed by Employee, including interest or
penalties owed by Employee, on account of this Agreement.  Employee
further agrees to reimburse Company for any attorney’s fees and costs incurred
by Company as a result of having to obtain indemnification under this
Agreement.




4. 
Confidential
Information.  Employee shall return all of the Company’s
confidential and proprietary information (including, but not limited to all
office equipment, records, data, notes, reports, correspondence, credit cards
and calling cards, other documents, computer files or property, keys or
reproductions, including but not limited to copies thereof, regardless of the
form or medium stored therein, including electronic medium) in Employee’s
possession to the Company’s designated HR representative within five (5) days
from the Termination Date.







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5. 
Payment of
Salary.  Employee acknowledges and represents that the Company
has paid all salary, wages, bonuses, commissions, accrued vacations, expenses
and any and all other benefits due to Employee once the payments and benefits
noted in this Agreement are received.




(a) Accrued Vacation.
Company shall pay Employee accrued but unused vacation through Termination Date
totaling $21,206.00, less applicable state and federal required withholding
amounts.




(b) Expenses.  Company
shall reimburse Employee for reasonable business expenses Employee incurred
through Employee’s Termination Date, provided Employee submits Employee’s
expense reports, including all supporting receipts and invoices, no later than
May 15, 2008 to the Company’s designated HR representative, including
reimbursement for out-of-pocket expenses associated with cancellation of travel
arrangements.




6. 
Equipment and Other
Materials.  Employee agrees to return computers in Employee’s
possession with their associated equipment, docking station, carry bags and any
and all peripherals, and cellular phones, keys, calling cards, credit cards and
other Company materials to the Company’s designated HR representative within
five (5) business days from the Termination Date as defined in Paragraph 2 of
this Agreement.




7. 
Release of
Claims. Employee agrees that the foregoing consideration represents
settlement in full of all outstanding obligations owed to Employee by the
Company.  Employee, on Employee’s own behalf, and on behalf of
Employee’s respective heirs, family members, executors, and assigns, hereby
fully and forever releases the Company and its officers, directors, employees,
investors, shareholders, administrators, affiliates, divisions, subsidiaries,
predecessor and successor corporations, and assigns, from, and agree not to sue
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 Employee may possess arising from any omissions, acts or facts
that have occurred up until and including the Effective Date of this Agreement
including, without limitation:




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




(b) 
any and all claims relating to, or arising from, 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 under the law of any jurisdiction including, but not limited
to, wrongful discharge of employment; constructive discharge from 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;







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(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 Americans with Disabilities Act of 1990, the Fair
Labor Standards Act, the Employee Retirement Income Security Act of 1974 (except
for vested benefits), The Worker Adjustment and Retraining Notification Act,Family Medical Leave
Act;




(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;




(g) 
any claim for any loss, cost, damage, or expense arising out of any dispute over
the non-withholding or other tax treatment of any of the proceeds received by
Employee as a result of this Agreement; and




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




The
Company and Employee agree that the release set forth in this Section shall be
and remain in effect in all respects as a complete general release as to the
matters released.  This release does not extend to any obligations
incurred under this Agreement nor to any obligations described in Section 8 of
the Employment Agreement dated March 8, 2006, between Employee and the
Company.




Employee
acknowledges and agrees that any breach of any provision of this Agreement shall
constitute a material breach of this Agreement and shall entitle the Company
immediately to recover the severance benefits provided to Employee under this
Agreement.  Employee shall also be responsible to the Company for all
costs, attorneys’ fees and any and all damages incurred by the Company (a)
enforcing the obligation, including the bringing of any suit to recover the
monetary consideration, and (b) defending against a claim or suit brought or
pursued by Employee in violation of this provision.




8. 
Acknowledgement of
Waiver of Claims Under ADEA.  Employee acknowledges that he is
waiving and releasing any rights he may have under the Age Discrimination in
Employment Act of 1967 (“ADEA”) and that this waiver and release is knowing and
voluntary.  Employee and the Company agree that this waiver and
release does not apply to any rights or claims that may arise under ADEA after
the Effective Date of this Agreement.  Employee acknowledges that the
consideration given for this waiver and release Agreement is in addition to
anything of value to which Employee was already entitled.  Employee
further acknowledges that he has been advised by this writing that
Employee:





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




(b)  has
up to twenty-one (21) calendar days within which to consider this
Agreement;




(c)   has
seven (7) calendar days following Employee’s execution of this Agreement to
revoke the Agreement;




(d)  this
Agreement shall not be effective until the revocation period has
expired;




(e)  
nothing in this Agreement prevents or precludes Employee from challenging or
seeking a determination in good faith of the validity of this waiver under the
ADEA, nor does it impose any condition precedent, penalties or costs for doing
so, unless specifically authorized by federal law;




(f)  
in order to revoke this Agreement, Employee must deliver to Company at the
following address a written revocation before 12:00 p.m. (midnight) Pacific Time
on the seventh calendar day following the date Employee signs this Agreement:
Human Resources Business Partner, Taleo Corporation, 4140 Dublin Blvd., 4th Flr.,
Dublin, CA 94568, Facsimile:  415.520.0722




9.  No Pending or Future
Lawsuits.  Employee represents that he has no lawsuits, claims,
or actions pending in Employee’s name, or on behalf of any other person or
entity, against the Company or any other person or entity referred to
herein.  Employee also represents that he does not intend to bring any
claims on Employee’s behalf or on behalf of any other person or entity against
the Company or any other person or entity referred to herein.




10.  Confidentiality.  Employee
acknowledges that he was exposed to and has received Taleo’s confidential,
proprietary and other information including, but not limited to, financial
reports, expenses, vendor information, Taleo’s technology and software, Taleo
specific sales and marketing tools, business plans, sales pipelines, in-process
press materials or plans, pricing data, product roadmaps or other product
information that has not been purposely published to the public by Company,
presentations, customer lists, customer contact information, product weaknesses,
performance problems or incidents, records of any management discussions,
records or notes from any user group, focus group, advisory board or corporate
board meetings, events or related interactions (“Confidential
Information”).  Employee agrees that he will not use or disclose any
information relating to the Company’s information regardless of whether it is
determined to be trade secret, confidential or proprietary.  Employee
shall return (and not keep in his possession or control or recreate or deliver
to any other person or entity) all of the Company’s Confidential Information and
proprietary information, including copies thereof, regardless of the form or
medium stored therein in Employee’s possession to Company’s designated HR
representative within five (5) days of the Termination Date. Employee
acknowledges and agrees that he must comply with the applicable terms of the
employment agreement dated March 8, 2006, between Employee and the
Company.





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11. 
No
Cooperation.  Employee agrees that he 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 under a subpoena
or other court order to do so.  Employee further agrees both to
immediately notify the Company upon receipt of any court order, subpoena, or any
legal discovery device that seeks or might require the disclosure or production
of the existence or terms of this Agreement, and to furnish, within three (3)
business days of its receipt, a copy of such subpoena or legal discovery device
to the Company.




12. 
Non-Disparagement.  Employee
agrees to refrain from any defamation, libel or slander of the Company or
tortious interference with the contracts and relationships of the
Company.  Employee further agrees to refrain from disparaging the
Company and the employees in any way. All inquiries by potential future
employers of Employee will be directed to the Chief Executive
Officer.  Employee agrees that the terms of this Agreement are
confidential and may not be shared by Employee with third parties other than
immediate family and legal and financial advisors.




13. 
Non-Solicitation.  Employee
agrees that for a period of twelve (12) months immediately following the
Termination Date, Employee shall not either directly or indirectly solicit,
induce, recruit or encourage any of the Company’s employees to leave their
employment, or take away such employees, or attempt to solicit, induce, recruit,
encourage, take away or hire employees of the Company, either for Employee or
any other person or entity.




14. 
No Admission of
Liability.  No action taken by the Parties hereto, or either of
them, either previously or in connection with this Agreement shall be deemed or
construed to be:




(a) an
admission of the truth or falsity of any claims heretofore made; or




(b) an
acknowledgment or admission by either party of any fault or liability whatsoever
to the other party or to any third party.




15. 
No Knowledge of
Wrongdoing.  Employee represents that he has no knowledge of
any wrongdoing involving improper or false claims against a federal or state
governmental agency, or any other wrongdoing that involves Employee or other
present or former Company employees.




16. 
Costs.  The
Parties shall each bear their own costs, expert fees, attorneys' fees and other
fees incurred in connection with this Agreement.




17. 
Indemnification.  Employee
agrees to indemnify and hold harmless the Company from and against any and all
loss, costs, damages or expenses, including, without limitation, attorneys’ fees
or expenses incurred by the Company arising out of the breach of this Agreement
by Employee, or from any false representation made herein by Employee, or from
any action or proceeding which may be commenced, prosecuted or threatened by
Employee or for Employee’s benefit, upon Employee’s initiative, or with
Employee’s aid or approval, contrary to the provisions of this
Agreement.  Employee further agrees that in any such action or
proceeding, this Agreement may be pled by the Company as a complete defense, or
may be asserted by way of counterclaim or cross-claim.





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18. 
Arbitration.  The
Parties agree that any and all disputes arising out of the terms of this
Agreement, their interpretation, and any of the matters herein released,
excluding paragraphs 4, 7, 8, 10, 11, 12 and 13 shall be subject to binding
arbitration in the State of California, before the American Arbitration
Association under its Employment Dispute Resolution Rules.  The
Parties agree that the prevailing party in any arbitration shall be entitled to
injunctive relief in any court of competent jurisdiction to enforce the
arbitration award.  The Parties agree that the prevailing party in any
arbitration shall be awarded its reasonable attorneys’ fees and costs. The
Parties hereby agree to waive their right to have any dispute between them
resolved in a court of law by a judge or jury.This provision will not
prevent either party from seeking injunctive relief (or any other provisional
remedy) from any court having jurisdiction over the parties and the subject
matter of their dispute relating to Employee’s obligations under this
Agreement.




19. 
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 that may claim through it
to the terms and conditions of this Agreement.  Employee represents
and warrants that he has the capacity to act on Employee’s own behalf and on
behalf of all who might claim through Employee’s 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.




20. 
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 provisions of this Agreement.  Neither
party has relied upon any representations nor statements made by the other party
hereto which are not specifically set forth in this Agreement.




21. 
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 so long as the
remaining provisions remain intelligible and continue to reflect the original
intent of the Parties. Notwithstanding the foregoing, if the Release provisions
(or any portion thereof) contained in this Agreement are held to be invalid,
void or unenforceable by a court of competent jurisdiction or by an
administrative agency for any reason whatsoever, as a result of actions or
inactions by Employee or anyone acting on Employee’s behalf, such ruling shall
render this Agreement void and Employee shall repay to the Company all monies
paid to or on behalf of Employee as set forth in this Agreement within
forty-eight (48) hours of such determination, to the extent permitted by law and
to the extent that such repayment does not result in the invalidation of this
Agreement.







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22. 
Entire
Agreement.  This Agreement constitutes the entire agreement and
understanding between the Parties concerning the subject matter of this
Agreement and all prior representations, understandings, and agreements
concerning the subject matter of this Agreement have been merged into this
Agreement.




23. 
No
Waiver.  The failure of any party to insist upon the
performance of any of the terms and conditions in this Agreement, or the failure
to prosecute any breach of any of the terms and conditions of this Agreement,
shall not be construed thereafter as a waiver of any such terms or
conditions.  This entire Agreement shall remain in full force and
effect as if no such forbearance or failure of performance had
occurred.




24. 
No Oral
Modification.  Any modification or amendment of this Agreement,
or additional obligation assumed by either party in connection with this
Agreement, shall be effective only if placed in writing and signed by both
Parties or by authorized representatives of each party.  No provision
of this Agreement can be changed, altered, modified, or waived except by an
executed writing by the Parties.




25. 
Governing
Law.  This Agreement shall be deemed to have been executed and
delivered within the State of California, and it shall be construed,
interpreted, governed, and enforced in accordance with the laws of the State of
California, without regard to conflict of law principles.  Subject to
Section 18 above, any permissible action at law, suit in equity, or other
judicial proceedings for the enforcement of this Agreement, or related to any
provision of this Agreement, shall be instituted only in courts with venue in
the State of California, except that the Company may seek injunctive relief in
any court having jurisdiction for any claim relating to the alleged misuse or
misappropriation of the Company’s trade secrets or confidential or proprietary
information.  Employee hereby expressly consents to venue and personal
jurisdiction of the state and federal courts in the State of California for any
lawsuit filed there against Employee by the Company arising from or relating to
this Agreement.




26. 
Attorneys’
Fees.  In the event that either Party brings an action to
enforce or affect its rights under this Agreement, the prevailing party shall be
entitled to recover its costs and expenses, including the costs of mediation,
arbitration, litigation, court fees, plus reasonable attorneys’ fees, incurred
in connection with such an action.




27. 
Counterparts.  This
Agreement may be executed in counterparts which may be exchanged by facsimile,
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.




28. 
Effective
Date.  This Agreement is effective after it has been signed by
both parties (the “Effective Date”).




29. 
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:







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(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




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




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







TALEO
      CORPORATIONDated:  May 8, 2008
              By:
      /s/ Josh
      FaddisJeffrey
      Carr, AN
      INDIVIDUALDated:  May 8, 2008
              By:
      /s/
      Jeffrey  Carr


Please
sign this page and initial every page before mailing to: Taleo Corporation,
attention:




Debbie
Shotwell, 4140 Dublin Blvd., 4th Flr.
Dublin, CA 94568.