EX-10.1






PERSONAL AND CONFIDENTIAL



June 25, 2007



[NAME]



Dear NAME:



This letter agreement (the “Agreement”) outlines the incentives offered by Encysive
Pharmaceuticals Inc. (the “Company”) to induce you (the “Employee”) to remain with the Company
during the Retention Period (as defined below), and to devote your full business time and efforts
to the Company. The terms of this offer are as follows:



A. Retention Bonus Provisions. If the Employee meets the eligibility criteria set forth
below, subject to the provisions of this Agreement, the Company will pay the Employee a Retention
Bonus (as defined below) in the amount and at the time set forth below.



1. Amount of Retention Bonus: The initial retention bonus (the “Initial Retention
Bonus”) will equal SIX (6) MONTHS (or 50%) of the Employee’s current annual base salary. For each
Extended Retention Period (as defined below), the extra retention bonus (the “Extra Retention
Bonus,” and collectively with the Initial Retention Bonus, the “Retention Bonus”) will equal TWO
(2) MONTHS (or 16.67%) of the Employee’s current annual base salary. The base salary used to
calculate the Retention Bonus shall include only the Employee’s monthly base salary and shall not
include any other compensation such as other bonuses, commissions, stock options, or employee
benefit payments.



2. Retention Period: The initial retention period is the period beginning on
June 25, 2007, and ending on December 31, 2007 (the “Initial Retention Period”). This Agreement
shall automatically renew for an additional two-month period (each a “Renewal Retention Period,”
and collectively with the Initial Retention Period, the “Retention Period”) at the end of the
Initial Retention Period or any Renewal Retention Period unless the Company provides the Employee
with written notice of termination at least THIRTY (30) days prior to the end of the Initial
Retention Period or any Renewal Retention Period. This Agreement shall not modify the Employee’s
employment status with the Company, including any written employment or termination agreement
between the Company and the Employee (an “Employment Agreement”). Subject to the terms of any
Employment Agreement, the Employee remains an employee-at-will during the entire time of employment
with the Company, and remains subject to termination under the provisions of Part B of this
Agreement.



3. Payment Eligibility Criteria. Each of the following criteria must be met by the
Employee in order for the Employee to be eligible for payment of the Retention Bonus:




	 	•	 	The Employee must sign this Agreement and return it to Pamela Mabry, Executive
Director, Global Human Resources, at Encysive Pharmaceuticals Inc., 4848 Loop
Central Drive, Suite 700, Houston, Texas 77081 by way of (i) hand delivery or (ii)
registered or certified mail, return receipt requested, on or before July 2, 2007;






	 	•	 	The Employee must continue to perform the responsibilities of the Employee’s
position, and such other related duties as assigned to the Employee, on a full-time
basis as determined in accordance with Company policy and procedures to the
satisfaction of the Company at all times during the Retention Period;






	 	•	 	During the Retention Period, the Employee must continue to comply with Company
policy and procedures;






	 	•	 	The Employee must not disclose or use, for the benefit of any person or entity
other than persons authorized by the Company and for the purpose of carrying out
the business of the Company or its affiliates, any confidential or proprietary
information of the Company or any trade secrets of the Company; and






	 	•	 	The Employee must comply with the terms and conditions of this Agreement.





Should there be any dispute regarding the meaning of this Agreement or any term of this
Agreement, the Company shall interpret the Agreement in accordance with the terms of the Agreement
and their intended meanings. The Company will have the discretion to make any findings of fact
needed to resolve disputes in the interpretation of the Agreement, and will have the discretion to
interpret or construe ambiguous, unclear, or implied (but omitted) terms. All actions taken and
all determinations made in good faith by the Company shall be final and binding upon all persons
claiming any interest in or under the Agreement. If any of the criteria outlined in this section
or otherwise required under this Agreement are not met or otherwise complied with, no Retention
Bonus shall be paid.



4. Timing of Retention Bonus Payments: The Initial Retention Bonus will be paid in
cash in two equal payments (each such payment equal to THREE MONTHS (or 25%) of the Employee’s
current annual base salary) on each of September 30, 2007 and December 31, 2007. Any Extra
Retention Bonus will be paid in cash in one lump sum payment (equal to TWO MONTHS (or 16.67%) of
the Employee’s current annual base salary) on the last business day of the Renewal Retention Period
for which such Extra Retention Bonus is owed. Any Retention Bonus paid to the Employee pursuant to
this Agreement shall be in addition to other compensation and benefits to which the Employee may
otherwise be entitled, including any severance payments and any Employment Agreement.



B. Employment Status. Notwithstanding this Agreement, at all times during the Retention
Period the Employee’s employment shall continue to be “at-will,” meaning that the Employee or the
Company may terminate the employment relationship at any time with or without notice and for any
reason, subject to the rights and obligations of this Agreement with respect to payment of the
Retention Bonus and any Employment Agreement. In the event the Employee continues in an employment
relationship with the Company following the Retention Period, such employment relationship will
also continue to be an “at-will” employment relationship, subject to any Employment Agreement.



1. Voluntary Termination by Employee Prior to End of the Initial Retention Period or any
Renewal Retention Period. In the event the Employee voluntarily terminates the Employee’s
employment with the Company for any reason at any time prior to the end of the Initial Retention
Period or any Renewal Retention Period, the Employee shall not be entitled to payment of any
portion of the Initial Retention Bonus or any Extra Retention Bonus, as applicable.



2. Termination by Company Prior to End of the Initial Retention Period or any Renewal
Retention Period. In the event the Employee’s employment with the Company is terminated by the
Company prior to the end of the Initial Retention Period or any Renewal Retention Period, other
than dismissal for Cause (as defined below), the Employee shall receive his or her current annual
base salary through the date of termination, accrued and unpaid vacation, any severance payments to
which Employee is eligible, as determined by the Company, and any unpaid Initial Retention Bonus or
any Extra Retention Bonus, as applicable, to be paid on the last day worked by Employee, which
shall be paid in a cash lump sum. The payment of the Initial Retention Bonus or any Extra
Retention Bonus, as applicable, in connection with the employee’s involuntary termination by the
Company under this Section B.2. or under Section C. below is subject to the Employee tendering
(without revocation if permitted to do so under applicable law), at the Company’s request, an
effective Separation Agreement (as defined below) within the 45-day period commencing on the date
of such termination. Payment of the Initial Retention Bonus or any Extra Retention Bonus, as
applicable, will be made within 10 business days after the effective date of the Employee’s
Separation Agreement. For the purposes of this Agreement, “dismissal for Cause” includes, but is
not limited to, violation of Company policy or procedures; misconduct; failure to perform
responsibilities in a satisfactory manner; the unauthorized use or disclosure of confidential
information or trade secrets of the Company or any affiliate, including disclosure of the existence
or terms and conditions of this Agreement; accepting employment with a competitor; or working under
the influence of drugs or alcohol. For the purposes of this Agreement, “Separation Agreement”
means an employment termination agreement in such form provided by the Company, which shall include
a general release of all claims with respect to the Company and all related parties (including but
not limited to officers, directors, agents, affiliates, successors and assigns). In the event the
Employee’s employment with the Company is terminated by the Company for Cause, the Employee shall
receive his or her current annual base salary through the date of termination and accrued and
unpaid vacation, but shall not receive any severance payments or any portion of the Initial
Retention Bonus or any Extra Retention Bonus, as applicable.



C. Change in Control of the Company. If, during the Retention Period, the Company is
acquired and the Employee’s employment with the Company is terminated other than for Cause,
Employee will receive his or her current annual base salary through the date of termination, the
Initial Retention Bonus or any Extra Retention Bonus, as applicable, accrued and unpaid vacation
and any severance payments to which Employee is eligible, as determined by the Company, to be paid
in a cash lump sum payment on the last day worked by the Employee. In addition, if the Employee
and the Company have entered into an Employment Agreement, the Employee shall be entitled to all
rights afforded to the Employee under such Employment Agreement.



D. Miscellaneous Provisions.



1. Modifications and Waivers. No provision of this Agreement shall be modified,
waived, or discharged unless the modification, waiver, or discharge is agreed to in writing and
signed by the Employee and an authorized representative of the Company. No delay in the exercise
of any right shall operate as a waiver thereof, no partial exercise of any right shall preclude a
further exercise thereof or the exercise of any other right or remedy. No waiver of any breach of
any condition or provision of this Agreement shall be considered a waiver of any other condition or
provision or of the same condition or provision at another time.



2. Whole Agreement. This Agreement contains the entire understanding of the Employee
and the Company with respect to the subject matter hereof and supersedes all other agreements,
whether written, oral or implied, regarding the subject matter of this Agreement; provided,
however, that if the Employee and the Company have entered into an Employment Agreement, the terms
of this Agreement are in addition to, and shall not supersede or otherwise modify, any and all the
rights and obligations contained in such Employment Agreement.



3. Taxes. All payments made under this Agreement shall be subject to reduction to
reflect taxes of other charges required to be withheld by law.



4. Choice of Law. This Agreement is being delivered and executed in the State of
Texas, and the validity, interpretation, construction, performance, and enforceability of this
Agreement shall be governed in all respects by the laws of the State of Texas, without regard to
the principles of comity or conflicts of laws of such state.



5. Severability. If any provision of this Agreement or the application of any
provision of this Agreement to any party or circumstance shall be prohibited by, or invalid under
applicable law, such provision shall be ineffective only to the extent of such prohibition without
invalidating the remainder of such provision or any other provision of this Agreement.



6. Confidentiality of this Agreement. Employee shall at all times keep confidential
(except for disclosure to Employee’s spouse, accountants, and attorneys) the existence and terms
and conditions of this Agreement. A breach of this provision is a breach of this Agreement and no
Initial Retention Bonus or Extra Retention Bonus, as applicable, will be paid or payable.



If the terms and conditions of this Agreement are acceptable to you, please sign and date this
letter in the spaces provided below and return the original to the Company by the due date
described in Section A.3. Please keep a copy for your records.



ACCEPTED AND AGREED:                               ENCYSIVE PHARMACEUTICALS INC.



Signature:                                                                  By:
                                                                 



Name:                                                                        Title: Chief
Financial Officer



                                         Name: Gordon Busenbark



Date:                                                                          Date: