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Exhibit 10.5 AGREEMENT REGARDING CONSULTING, RESIGNATION AND GENERAL RELEASE OF CLAIMS 1. Donald R. Sellers (Sellers) is currently employed by SciClone
Pharmaceuticals, Inc., a Delaware corporation (the Company) as its president
and Chief Executive Officer. Sellers has decided to resign from his employment
with the Company but has agreed to be available to the Company in a consulting
capacity. It is the Companys desire to provide Sellers with certain benefits
that he would not otherwise be entitled to receive upon his resignation and to
resolve any claims that Sellers has or may have against the Company.
Accordingly, Sellers and the Company agree as set forth below. This Agreement
will become effective on the eighth day after it is signed by Sellers (the
Effective Date), provided that Sellers has not revoked this Agreement (by
written notice to the Company) prior to that date. 2. Sellers hereby resigns voluntarily from his employment with the Company
effective as of July 14, 2004 (the Resignation Date), and this resignation
shall include his resignation from all positions he may hold as an employee,
officer, director, registered agent or in any other capacity with the Company
or any of its subsidiaries. Sellers hereby resigns his position as a director
on the Companys Board of Directors. No further notice or documentation of
such resignations is required by the Company, but Sellers agrees to sign any
other documents that may be necessary in any foreign jurisdiction in connection
with such resignation. 3. Subject to Sellers compliance with this paragraph and paragraphs 6, 7 &
8, the Company shall provide Sellers with the following benefits after this
Agreement becomes effective: (a) within three days of the Effective Date, Sellers shall receive
in a lump sum payment made to his [  ] account, representing: Sellers
normal compensation up to the Resignation Date, plus accumulated PTO up
to the Resignation Date, plus the Cash Bonus (as defined in the Sellers
Employment Agreement and amendments thereto (the Employment Agreement)
pro-rated through the Resignation Date(which shall be an aggregate amount
of $130,822) (less applicable withholding). (b)
Two one time consulting payments paid to Sellers
[  ] per the
attached Consulting Agreement: (i) the first payment equal to $554,204.00, representing
an amount equal to one year of Sellers annual wages at
his current base pay rate plus annual Cost-of-living
Assistance (as defined in the Employment Agreement) plus
one years car allowance. (ii) The second payment equal to $544,004.00,
representing an amount equal to one year of Sellers
annual wages at his current base pay rate plus
Cost-of-living Assistance (as defined in the Employment
Agreement)




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(c) If Sellers was covered under the Companys group health plan as
of the Resignation Date, he will have the right to elect to continue his
group health coverage pursuant to both federal and California law
(COBRA). If Sellers timely elects to obtain such group health insurance
coverage in accordance with COBRA following the Resignation Date, the
Company will pay the premiums for such coverage through the earlier of
(i) the three year period following the Resignation Date (beginning on
the Effective Date and ending on the third anniversary of such date), or
(ii) the date on which Sellers first obtains other group health insurance
coverage under another employers group health plan; thereafter, Sellers
may elect to purchase continued group health insurance coverage at his
own expense in accordance with COBRA; (d) Sellers outstanding stock options as of the Resignation Date
shall become immediately vested. In addition, the exercise period of all
stock options granted to Sellers after the Amended Anniversary Date (as
that term is defined in the Employment Agreement) occurring in 2003 (the
Subsequent Stock Options) shall be extended for a period of two years
from the Resignation Date, provided, however, that all stock options
granted to Sellers prior to the Amended Anniversary Date occurring in
2003 (the Previous Stock Options) shall be governed by the provisions
of Section 5.2(c)) of the original Employment Agreement .
Notwithstanding the foregoing, such extension of the exercise periods of
the Subsequent Stock Options and the Previous Stock Options,
respectively, shall not exceed the original terms of such options; (e) Sellers will be permitted to keep the furniture, which is
Sellers personal property, that is in Sellers office at the Company.
Sellers may also keep the laptop computer provided to him by the
Company, however, Sellers shall delete all Company records from such
laptop and at the Companys request will allow the Company to verify such
removal. (f) Sellers agrees that he will make himself available to the
Company as a consultant for the two year period described in subparagraph
3(a) above and the Company agrees that it will pay for such services as
follows: a daily consulting fee of $2,000 for each full day or
substantially full day, or $300 per hour for activities that do not
require all or substantially all of a day. Such services will be
provided in accordance with the terms of a consulting agreement (annex A)
that will be entered into by and between Sellers and Company as of the
date of this Agreement. The Company shall be entitled to make telephone
inquires of Sellers of short duration without charge, however, if there
are numerous such calls, Sellers may aggregate the time for such calls
and the Company will pay for them at the hourly rate. The Company and
Sellers shall cooperate in the timing of any assignments he engages in
pursuant to this provision so that they do not interfere with any other
employment arrangement Sellers may have, but the parties agree that
Sellers timely availability to assist the Company when requested is an
important part of the consideration under this Agreement. (g) To ensure the proper transfer of corporate authority following
the end of Sellers employment, and exclusively for the purpose of
transferring permits or authorizations or similar Company documents,
designating substitute persons to act on behalf of the Company, or
similar (and similarly limited) corporate purposes, Sellers shall execute
a form of limited Power of Attorney in the form attached. -2-




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(h) Company will cooperate as Sellers requests within its authority
with respect to the transfer of Sellers 401K plan monies and other
Company related benefits to which Sellers is entitled. Upon presentation
of receipts therefore, the Company will cover normal and customary
expenses that have been previously reimbursed that may be outstanding up
to the time of or directly related to the Resignation and to cover the
costs, if any, of terminating Company specific communication services,
the aggregate amount of which is not expected to exceed $2,000. (i) Sellers acknowledges that upon receipt of the funds provided
under Section 3(a) herein, he has been paid all wages and accrued, unused
PTO that Sellers earned during his employment with the Company through
the Resignation Date. Sellers understands and acknowledges that he shall
not be entitled to any payments or benefits from the Company other than
those expressly set forth in this paragraph 3. (j) Sellers will abide by the terms of the Companys standard
confidentiality agreement between the Company and its Employees. 4. (a) Sellers and his successors and assigns release the Company and its
shareholders, investors, directors, officers, employees, agents, attorneys,
insurers, legal successors and assigns of and from any and all claims, actions
and causes of action, whether now known or unknown, which Sellers now has, or
at any other time had, or shall or may have against those released parties
based upon or arising out of any matter, cause, fact, thing, act or omission
whatsoever occurring or existing at any time up to and including the date on
which Sellers signs this Agreement, including, but not limited to, any claims
of breach of contract, wrongful termination, retaliation, defamation,
infliction of emotional distress or national origin, race, age, sex, sexual
orientation, disability or other discrimination or harassment under the Civil
Rights Act of 1964, the Age Discrimination In Employment Act of 1967, the
Americans with Disabilities Act, the Fair Employment and Housing Act or any
other applicable law. (b) The Company and its directors, officers, employees, agents, attorneys,
insurers, legal successors and assigns release Sellers and his successors and
assigns of and from any and all claims, actions and causes of action, whether
now known or unknown, which the Company and its directors, officers, employees,
agents, attorneys, insurers, legal successors and assigns now has, or at any
other time had, or shall or may have against those released parties based upon
or arising out of any matter, cause, fact, thing, act or omission whatsoever
occurring or existing at any time up to and including the date on which Sellers
signs this Agreement, including, but not limited to, any claims of breach of
contract, retaliation, defamation, infliction of emotional distress or
harassment under the Civil Rights Act of 1964, the Age Discrimination In
Employment Act of 1967, the Americans with Disabilities Act, the Fair
Employment and Housing Act or any other applicable law. 5. Both parties to this agreement acknowledge that they have read section
1542 of the Civil Code of the State of California, which states in full: 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. -3-




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Both parties to this agreement waive any rights that they have or may have
under section 1542 to the full extent that each party may lawfully waive such
rights pertaining to this general release of claims, and both parties affirm
that they are releasing all known and unknown claims that they have or may have
against the parties listed above. 6. Sellers acknowledges and agrees that he shall continue to be bound by
and comply with the terms of any proprietary rights, assignment of inventions
and/or confidentiality agreements between the Company and Sellers. As soon as
possible, but no later than 22 July 2004 (and except as provided in paragraph
3), Sellers will return to the Company, in good working condition, all Company
property and equipment that is in Sellers possession or control, including any
files, records, computers, computer equipment, cell phones, credit cards, keys,
programs, manuals, business plans, financial records, and all documents (and
any copies thereof) that Sellers prepared or received in the course of his
employment with the Company. Sellers also agrees that he will return to the
Company (or to Companys legal counsel) As soon as possible, but no later than
22 July 2004 all Company paperwork that is in his personal care. 7. (a) Sellers agrees that he shall not directly or indirectly disclose
any of the terms of this Agreement to anyone other than his immediate family or
counsel, except as such disclosure may be required for SEC reporting,
accounting or tax reporting purposes or as otherwise may be required by law.
Sellers further agrees that he will not, at any time in the future, make any
libelous or defamatory statements about the Company, its products or its
employees, unless such statements are made truthfully in response to a subpoena
or other legally required disclosure. process. (b) Company agrees that it, its Directors, officers and other knowing
employees, advisors, counsel and consultants shall not directly or indirectly
disclose any of the terms of this Agreement to anyone other than counsel,
except as such disclosure may be required for SEC reporting, accounting or tax
reporting purposes or as otherwise may be required by law. Company, its
Directors, officers and other knowing employees, advisors, counsel and
consultants further agree that they will not, at any time in the future, make
any libelous or defamatory statements about Sellers unless such statements are
made truthfully in response to a subpoena or other legally required disclosure. 8. Sellers agrees that for a period of two (2) years following the
Resignation Date, he will not, on behalf of himself or any other person or
entity, directly or indirectly: (i) solicit any employee of the Company to
terminate his/her employment with the Company or (ii) unless approved by the
Companys Board of Directors, participate with any other party in an effort to
solicit proxies from Company stockholders for any proposal or matter other than
one recommended by the Companys Board or (y) make a tender offer or similar
offer to Companys stockholders. 9. The Company agrees that for a period of two (2) years following the
Resignation Date (or until the termination of the consultation period if
different) the Company will continue to honor the indemnification agreement and
other existing indemnity obligations between Sellers and the Company (and for
avoidance of doubt, such indemnification shall cover any and all acts, if any,
carried out pursuant to the Power of Attorney and arising from Sellers
services as a consultant) and if the indemnification agreements with other
officers and directors of the -4-




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Company are modified to extend additional benefits to the officers or
directors, such changes shall be applicable to Sellers during such period. 10. Sellers and Company agree that any press release concerning this
separation will be in substantially the form as provided to Sellers by the
Company prior to the time of execution of this Agreement. . 11. In the event of any legal action relating to or arising out of this
Agreement, the prevailing party shall be entitled to recover from the losing
party its attorneys fees and costs incurred in that action. Any notice to the
Company hereunder shall be in writing and delivered to the Companys Chief
Financial Officer via Federal Express or email. 12. This Agreement constitutes the entire agreement between the parties
with respect to the subject matter hereof and supersedes all prior negotiations
and agreements, whether written or oral, with the exception of any stock option
agreements between the parties and any agreements described in paragraph 6.
This Agreement may not be modified or amended except by a document signed by an
authorized officer of the Company and Sellers. SELLERS UNDERSTANDS THAT HE SHOULD (AND REPRESENTS THAT HE HAS) CONSULT WITH AN
ATTORNEY PRIOR TO SIGNING THIS AGREEMENT AND THAT HE IS GIVING UP ANY LEGAL
CLAIMS HE HAS AGAINST THE PARTIES RELEASED ABOVE BY SIGNING THIS AGREEMENT.
SELLERS FURTHER UNDERSTANDS THAT HE MAY HAVE UP TO 21 DAYS TO CONSIDER THIS
AGREEMENT, THAT HE MAY REVOKE IT AT ANY TIME DURING THE 7 DAYS AFTER HE SIGNS
IT, AND THAT IT SHALL NOT BECOME EFFECTIVE UNTIL THAT 7-DAY PERIOD HAS PASSED.
SELLERS ACKNOWLEDGES THAT HE IS SIGNING THIS AGREEMENT KNOWINGLY, WILLINGLY AND
VOLUNTARILY IN EXCHANGE FOR THE BENEFITS DESCRIBED IN PARAGRAPH 3. Dated: July 14, 2004
    /s/ Donald R. SellerDonald R. SellersSciClone Pharmaceuticals, Inc.Dated: July 14, 2004
    By:
    /s/ Richard WaldronChief Financial Officer
 -5-




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Limited Power of Attorney I hereby authorize Richard A. Waldron and Dr. Alfred Rudolph, or either of
them, to execute under power of attorney any document that may require my
signature as an officer, agent or employee of SciClone Pharmaceuticals, Inc. or
of any of its subsidiaries but only for purposes of transferring permits or
authorizations or similar corporate documents, designating substitute persons
to act on behalf of any such entity, or similar corporate purposes. Date: July 14, 2004 /s/ Donald R. Sellers   -6-




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ANNEX A SERVICE AGREEMENT THIS AGREEMENT is made on the 14th day of July, 2004 (the Effective Date), by
and between: SCICLONE PHARMACEUTICALS, Inc. (the Company), a company duly organized and
existing under the laws of California, having a principal place of business at
901 Mariners Island Blvd., San Mateo, California, 94404; and Donald R. Sellers
(hereinafter referred to as Consultant), a legal resident of the United
States of America, [___] WHEREAS the Company desires to obtain and Consultant is willing to provide a
certain range of services, subject to the terms and conditions stated herein: NOW, THEREFORE, the parties agree as follows: 1. SERVICES Consultant shall use its best efforts to provide the Company with the following
services and assistance related to the Companys business. Services will
include, but not be limited to: serving as an advisor to the Company;
consulting and liaison services, assistance in examining, understanding and
explaining appropriate ways to use the Companys products and personnel and
interactions with third parties. 2. SECURING OF SERVICES Consultant agrees not to make any agreements, warranties, guarantees or
representations respecting the Company, or the relationship between Consultant
and the Company, which are inconsistent with the provisions of this Agreement. 3. FEES (a) In consideration for the Services above, the Company agrees to pay to
Consultants [  ] a retainer of $554,204.00 (US Dollars Five hundred fifty
four thousand two hundred four only) on 5 January 2005 and a retainer of
$544,004.00 (US Dollars Five hundred forty four thousand two hundred four only)
on 5 January 2006. (b) An additional sum of $2,000.00 (US Dollars two thousand only) will be
paid to Consultant for each day or substantial part thereof of consulting
requested by the Company, or if less than substantially all of a day is
occupied by the assignment, a sum of $300 per hour. The Company shall be entitled to make telephone inquires of Sellers of
short duration without charge, however, if there are numerous such calls,
Sellers may aggregate the time for such calls and the Company will pay for them
at his hourly rate. 4. EXPENSES Travel and entertainment expenses authorized in advance will be paid by the
Company. The Company authorizes business class travel for consultants. -7-




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4a. PERSONAL LIABILITIES Consultant shall be solely responsible for any and all losses, damages,
liabilities, costs and expenses incurred by Consultant, arising out of the
performance of the Services. 5. NO DELEGATION OR ASSIGNMENT This Agreement and Consultants obligations and right to compensation hereunder
may not be assigned or delegated to any person, firm or entity without the
Companys prior written consent. 6. NO AGENCY OR EMPLOYMENT RELATIONSHIP The relationship of the Company and Consultant established by this Agreement is
that of independent contractors. This Agreement shall not constitute either of
the parties hereto as the legal representative, employee or agent of the other,
nor shall either party have the right to assume, create or incur any liability
or any other obligation express or implied, against or in the name of or on
behalf of the other party. 7. DURATION, EXPIRATION AND TERMINATION This Agreement shall be for a period of twenty four months after the Effective
Date and expire automatically on July 14, 2006, unless renewed by agreement of
the parties, in writing, prior to the date of expiration. In the event of a
breach of any term or condition hereof, the party not in breach may immediately
terminate this Agreement upon giving a written notice to the breaching party. 8. CONFIDENTIALITY Consultant acknowledges that during the term of this Agreement, Consultant may
have access to information concerning the Companys sales, earnings, financial
condition, strategic business objectives, business relationships and other
information concerning the Company and its operations (the Confidential
Information). Consultant agrees that the Confidential Information is the sole
property of the Company, and that Consultant will not disclose or transfer the
Confidential Information to any person, firm or entity, except with the prior
written consent of the Company. Under no circumstances will Consultant use any
of the Confidential Information for Consultants personal gain. 10. GOVERNING LAW This Agreement shall be construed in accordance with the laws of the state of
California. 11. COMPLIANCE WITH THE LAW AND REGULATIONS Consultant agrees that all activities performed, directly or indirectly, by
Consultant in connection with this Agreement shall be carried out in accordance
with all applicable laws, regulations, procedures and policies.. -8-




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IN WITNESS WHEREOF, the parties have hereunto affixed their signature, through
their duly authorized representatives, as of the date first above written. SIGNATURE PAGE SCICLONE PHARMACEUTICALS, INC.
    
    Donald R. Sellers/s/ Richard Waldron
    
    /s/ Donald R. Sellers
 -9-