Exhibit 10.82


SEPARATION
AGREEMENT


This Separation Agreement
(“Agreement”) is made and entered into by and between Taylor Crouch (“Crouch”)
and Discovery Partners International, Inc. (the “Company”), effective as of the
Effective Date specified in Section 11 hereof. 
Crouch and the Company hereby agree as follows:


1.             SEPARATION
DATE.


(a)           Separation
Date.  Crouch and the Company agree that on
January 18, 2005 Crouch’s employment with the Company will be terminated
(the “Separation Date”) pursuant to the terms and conditions stated herein.


(b)           Severance
Pay.  In exchange for Crouch’s promises and
covenants in this Agreement, the Company will pay to Crouch the equivalent of
fifty-six (56) weeks of his base salary in effect as of the Separation
Date (a gross sum of $378,538), less standard required withholding and
deductions, in a lump sum payable within ten (10) business days following the
Effective Date of this Agreement (the “Payment Date”).  Upon the Separation Date, Crouch will be paid
for any accrued vacation and any salary earned through the Separation Date,
regardless of whether he signs this Agreement.


(c)           Benefits. 
Crouch may exercise benefit conversion options as available under plan
provisions, applicable state insurance laws and COBRA, as provided in Section 3
herein.  Crouch’s continued participation
in all other Company benefits will cease on the Separation Date.


(d)           Telephone and Email
Coverage.  Until June 30, 2005, the administrative
assistant assigned to Crouch will direct personal calls to Crouch in any
reasonable manner specified by Crouch and the Company will forward any personal
emails directed to Crouch at the Company to such email address as specified by
Crouch.


(e)           Cell Phone and Computer. 
Prior to the Separation Date, Crouch shall deliver the laptop computer
and all data stored thereon provided him by the Company to a representative of
the IT Department specified by the Company. 
The Company shall purge all Company-related data and will then
transfer ownership of the computer to Crouch no later than the Payment
Date.  The Company will transfer
ownership of the cell phone provided to Crouch by the Company by the Payment
Date, provided that Crouch shall cooperate in transferring the service account
and changing the phone number.


(f)            Attorneys’ Fees.  The Company shall reimburse Crouch for reasonable
attorneys’ fees incurred in reviewing this Agreement, up to a maximum of two
thousand dollars ($2,000.00), upon presentation of satisfactory proof such
expenses have been incurred.


(g)           Options.  The
Company will grant Crouch a period of up to one year (365 days) from the
Separation Date in which to exercise his vested options.


 


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2.             EXPENSE
REIMBURSEMENT.  Crouch agrees
that he will submit any final documented expense reimbursement statements
reflecting all business expenses incurred prior to and including the Separation
Date, for which he seeks reimbursement no later than February 28, 2005.  The Company shall reimburse Crouch’s expenses
pursuant to Company policy and regular business practice.


(a)           JP Morgan Conference. 
The Company will reimburse Crouch only for reasonable
transportation,  lodging, conference
fees, and personal meal expenses incurred in connection with the J.P. Morgan
Chase Healthcare Conference.


3.             INSURANCE
BENEFITS.  After the Separation Date, to the extent
provided by the federal COBRA law or, if applicable, state insurance laws, and
by the Company’s current group health insurance policies, Crouch will be
eligible to continue his health insurance benefits at his own expense.  Crouch will be provided with a separate
notice of his COBRA rights in advance of exercising this Agreement.


4.             OTHER
COMPENSATION AND BENEFITS.  Except as
expressly provided herein, Crouch acknowledges and agrees that he is not
entitled to and will not receive any additional compensation, severance, stock
options, stock or benefits from the Company. 
Crouch agrees and understands that all vesting under any stock
compensation award (e.g.,
incentive stock option, nonqualified stock option, stock purchase agreement, or
restricted stock bonus agreement) from the Company shall cease upon the
Separation Date.  Other than as specified
in this Agreement, any and all rights that Crouch may have in any Employee
Stock Purchase Plan or Stock Option Plan shall be determined in accordance with
the provisions of the applicable plan and any related agreements signed by
Crouch.


5.             REPAYMENT
OF PROMISSORY NOTE AND SECURITY INTEREST.  Crouch shall repay in full
the principal sum of Three Hundred Thousand Dollars ($300,000.00) to the
Company, as described in the Promissory Note of July 29, 2002 made by Crouch to
the Company (the “Note”), on the Payment Date, at which point the Note will be
cancelled.


(a)           Reduction of Balance
Owed by Bonus Credit.  Although the Company has no
legal obligation to pay Crouch a bonus for fiscal year 2004, the Company will
reduce the balance owed by Crouch under the Note by an amount equivalent to the
bonus Crouch could have earned for fiscal year 2004 (after withholding for
applicable taxes) had he met the eligibility requirements, after taking into
consideration corporate performance parameters for FY2004 to calculate the
bonus pool.


(b)           Reduction
of Balance Owed by Portion of Unvested Stock Grant. 
The Company and Crouch agree that (i) the Company shall
automatically reacquire at no cost any remaining unvested portion of any Stock
Grant made to Crouch on the Effective Date; and (ii) the Company will
reduce the balance owed under the Note by an amount equivalent to the sum of
the fair market value, on the Effective Date, of 21,250 shares of Company
Common Stock minus the amount of applicable withholding taxes on such amount,
as if the Stock Grants made to Crouch on August 8, 2003 and July 12, 2004 had
vested as to an additional twenty-five percent (25%) of the shares subject to
such Stock Grants on the Effective Date.


 


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(c)           Reduction of Balance Owed by Vested
Stock Grant.  The Company and Crouch agree that, Crouch
will surrender 8,750 vested shares of Company Common Stock to the Company and,
in exchange for those vested shares, the Company shall reduce the balance owed
under the Note by amount equivalent to the fair market value, on the Effective
Date, of such vested shares minus the amount of applicable withholding taxes on
such amount, if any.


(d)           Tax Advice. 
Crouch acknowledges and agrees that he has had an
opportunity to obtain the advice of counsel prior to executing this Agreement,
and Crouch fully understands all the terms of this Agreement and the
transaction contemplated by this Agreement. 
Crouch further acknowledges and agrees that the Company has recommended
that he seek independent tax counsel to advise him regarding this transaction,
and Crouch has had the opportunity to seek such counsel.


6.             COMPANY
PROPERTY.  Upon the Separation Date, and except as
otherwise specified in this Agreement, Crouch shall return to the Company all
Company documents (and all copies thereof) and other Company property in his
possession or his control, including, but not limited to, Company files,
business plans, notes, samples, sales notebooks, drawings, specifications,
calculations, sequences, data, computer-recorded information, tangible
property, including, but not limited to, credit cards, entry cards, keys and
any other materials of any nature pertaining to Crouch’s work with the Company,
and any documents or data of any description (or any reproduction of any
documents or data) containing or pertaining to any proprietary or confidential
material of the Company.


7.             PROPRIETARY
INFORMATION & INVENTIONS AGREEMENT.  Crouch
acknowledges his continuing obligations under his Proprietary Information and
Inventions Agreement not to use or disclose any confidential or proprietary
information of the Company without prior written authorization from a duly
authorized representative of the Company. 
A copy of Crouch’s Proprietary Information and Inventions Agreement is
attached hereto as Exhibit A.


8.             CONFIDENTIALITY
AND PUBLICITY.  The provisions of this Agreement shall be
held in strictest confidence by Crouch and the Company and shall not be
publicized or disclosed in any manner whatsoever; provided, however, that:  (a) Crouch may disclose this Agreement,
in confidence, to Crouch’s immediate family; (b) the parties may disclose
this Agreement, in confidence, to their respective attorneys, accountants,
auditors, tax preparers, and financial advisors; (c) the Company may
disclose this Agreement as necessary to fulfill standard or legally required
corporate reporting or disclosure requirements; and (d) the parties may
disclose this Agreement insofar as such disclosure may be necessary to enforce
its terms or as otherwise required by law.


9.             NONDISPARAGEMENT.  Crouch agrees that he will not at any time disparage
the Company or its directors, employees, shareholders and agents, in any manner
likely to be harmful to them or their business, business reputation or personal
reputation; provided that he shall respond accurately and fully to any
questions, inquiry or request for information when required by legal
process.  The Company agrees that it will
direct its executive officers and the members of its board of directors not to
disparage Crouch in any manner likely to be harmful to him or his business,
business reputation, or personal reputation; provided that the Company shall 


 


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respond accurately
and fully to any questions, inquiry, or request for information when required
by legal process.


10.          RELEASE
OF CLAIMS BY CROUCH.  In exchange for the promises and covenants set forth
herein, Crouch hereby releases, acquits, and forever discharges the Company,
its parents and subsidiaries, and their officers, directors, agents, servants,
employees, attorneys, shareholders, partners, successors, assigns and
affiliates of and from any and all claims liabilities, demands, causes of
action, costs, expenses, attorneys’ fees, damages, indemnities and obligations
of every kind and nature, in law, equity, or otherwise, known and unknown,
suspected and unsuspected, disclosed and undisclosed, arising out of or in any
way related to agreements, acts or conduct at any time prior to the date upon
which Crouch executes this Agreement, including, but not limited to:  all such claims and demands directly or
indirectly arising out of or in any way connected with the Company’s employment
of Crouch, the termination of that employment, and the Company’s performance of
its obligations as Crouch’s employer; claims or demands related to salary,
bonuses, commissions, stock, stock options, or any other ownership interests in
the Company, vacation pay, fringe benefits, expense reimbursements, severance
pay, or any form of compensation; claims pursuant to any federal, state or local
law or cause of action including, but not limited to, the California Fair
Employment and Housing Act; Title VII of the federal Civil Rights Act of 1964,
as amended; the federal Age Discrimination in Employment Act (“ADEA”); the
federal Americans With Disabilities Act; the Employee Retirement Income
Security Act; tort law; contract law; wrongful discharge; discrimination;
harassment; fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing.


11.          ADEA Waiver.  Crouch acknowledges that he is knowingly and
voluntarily waiving and releasing any rights he may have under ADEA, and that
the consideration given for the waiver and release in this Agreement is in
addition to anything of value to which Crouch was already entitled.  Crouch further acknowledges that he has been
advised by this writing that:  (a) his waiver and release do
not apply to any rights or claims that may arise after the execution date of
this Agreement; (b) he
should consult with an attorney prior to executing this Agreement; (c) he has twenty-one
(21) days to consider this Agreement (although Crouch may choose to voluntarily
execute this Agreement earlier);
(d) he has seven (7) days following the execution of this
Agreement by the parties to revoke the Agreement; and (e) this Agreement will not be
effective until the date upon which the revocation period has expired, which
will be the eighth day after the date Crouch executes this Agreement (the
“Effective Date”).  None of the payments
or benefits provided by this Agreement will be made to Crouch until the
Agreement has become effective.


12.          SECTION
1542 WAIVER.  In giving this release, which includes claims which
may be unknown to Crouch at present, Crouch hereby acknowledges that he has
read and understands Section 1542 of the Civil Code of the State of California
which reads 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.


 


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Crouch hereby
expressly waives and relinquishes all rights and benefits under
Section 1542 and any law or legal principle of similar effect in any
jurisdiction with respect to claims released hereby.


13.          RELEASE
OF CLAIMS BY THE COMPANY.  In exchange for the promises and covenants set forth
herein, the Company hereby releases, acquits, and forever discharges Crouch,
his successors, heirs, legal representatives and assigns of and from any and
all claims, liabilities, demands, causes of action, costs, expenses, attorneys’
fees, damages, indemnities and obligations of every kind and nature, in law,
equity, or otherwise, known and unknown, suspected and unsuspected, disclosed
and undisclosed, arising out of or any way related to agreements, acts or
conduct of Crouch in the good faith performance of duties within the scope of
his employment by the Company at any time prior to the date upon which the
Company executes this Agreement.


14.          NO
ADMISSIONS.  The parties hereto hereby acknowledge
that this is a compromise settlement of various matters, and that the promised
payments in consideration of this Agreement shall not be construed to be an
admission of any liability or obligation by either party to the other party or
to any other person whomsoever.


15.          ENTIRE
AGREEMENT.  This Agreement, including Exhibit A,
constitutes the complete, final and exclusive embodiment of the entire
Agreement between Crouch and the Company with regard to the subject matter
hereof.  It is entered into without
reliance on any promise or representation, written or oral, other than those
expressly contained herein.  It may not
be modified except in a writing signed by Crouch and a duly authorized officer
of the Company.


16.          SUCCESSORS
AND ASSIGNS.  This Agreement shall bind the heirs, personal
representatives, successors, assigns, executors, and administrators of each
party, and inure to the benefit of each party, its agents, directors, officers,
employees, servants, heirs, successors and assigns.


17.          APPLICABLE
LAW.  This Agreement shall be deemed to have been
entered into and shall be construed and enforced in accordance with the laws of
the State of California as applied to contracts made and to be performed
entirely within California.


18.          SEVERABILITY.  If a court of competent jurisdiction determines that
any term or provision of this Agreement is invalid or unenforceable, in whole
or in part, then the remaining terms and provisions hereof shall be
unimpaired.  Such court will have the
authority to modify or replace the invalid or unenforceable term or provision
with a valid and enforceable term or provision that most accurately represents
the parties’ intention with respect to the invalid or unenforceable term or
provision.


19.          AUTHORITY.  Crouch 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 and that Crouch
is duly authorized to give the release granted herein.


20.          SECTION HEADINGS.  The section and paragraph headings contained
in this Agreement are for reference purposes only and shall not affect in any
way the meaning or interpretation of this Agreement.


 


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20.          COUNTERPARTS.  This Agreement may be executed in two counterparts,
each of which shall be deemed an original, all of which together shall
constitute one and the same instrument.


21.          ARBITRATION.  To ensure rapid and economical resolution of any
disputes which may arise under this Agreement, you and the Company agree that
any and all disputes or controversies of any nature whatsoever, arising from or
regarding the interpretation, performance, enforcement or breach of this
Agreement shall be resolved by confidential, final and binding arbitration
(rather than trial by jury or court or resolution in some other forum).  Any arbitration proceeding pursuant to this
Agreement shall be conducted by the Judicial Arbitration and Mediation Service
(“JAMS”)
in San Diego, California, under the then-existing JAMS’ rules.


 


HAVING READ AND UNDERSTOOD THE FOREGOING, I HEREBY AGREE TO THE TERMS
AND CONDITIONS STATED ABOVE.


	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Dated: 

  	
   

  	
   

  
	
  Taylor Crouch

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  DISCOVERY PARTNERS
  INTERNATIONAL, INC.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Dated: 

  	
   

  	
   

  
	
  By:  Riccardo
  Pigliucci,

  	
   

  	
   

  	
   

  
	
          Chief
  Executive Officer

  	
   

  	
   

  	
   

  



 


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