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                                                                   Exhibit 10.16

                         PENINSULA PHARMACEUTICALS, INC.

                      EXECUTIVE CHANGE OF CONTROL AGREEMENT

      THIS EXECUTIVE CHANGE OF CONTROL AGREEMENT (the "AGREEMENT") is entered
into by and between Peninsula Pharmaceuticals, Inc., a Delaware corporation (the
"COMPANY"), and Paul F. Truex ("EXECUTIVE"), effective as of December 1, 2003.

      WHEREAS, Executive is a senior executive of the Company and has made and
is expected to continue to make major contributions to the short and long-term
profitability, growth and financial strength of the Company;

      WHEREAS, the Company recognizes that the possibility of a Change in
Control (as defined in Section 1) exists;

      WHEREAS, the Company desires to assure itself of both present and future
continuity of management and desires to establish certain minimum severance
benefits for certain of its senior executive officers and other key employees,
including Executive, applicable in the event of a Change in Control;

      WHEREAS, the Company wishes to ensure that its senior executives are not
practically disabled from discharging their duties in respect of a proposed or
actual transaction involving a Change in Control;

      WHEREAS, the Company desires to provide additional inducement for
Executive to continue to remain in the ongoing employ of the Company; and

      WHEREAS, the Company's Board of Directors has determined that it would be
in the best interests of the Company and its stockholders to provide for the
payment of severance benefits and the acceleration of the vesting of Executive's
Options (as defined in Section 1) in the event Executive's employment is
terminated in connection with a Change of Control (as defined in Section 1) of
the Company in order to align further the interests of Executive with those of
the stockholders of the Company as set forth below.

      NOW, THEREFORE, for valuable consideration, the adequacy of which is
hereby acknowledged by the parties, the parties hereby agree as follows:

      1. DEFINITIONS. The following terms in this Agreement shall have the
meanings set forth below solely for purposes of this Agreement:

            (A) "BASE SALARY" means Executive's annual base salary as in effect
during the last regularly scheduled payroll period immediately preceding the
effective date of the Covered Termination.

            (B) "BOARD" means the Board of Directors of the Company.

            (C) "CHANGE OF CONTROL" means the occurrence, in a single
transaction or in a series of related transactions, of any one or more of the
following events:


                                       1.
<PAGE>
                  (I) (A) there is consummated a merger, consolidation or
similar transaction involving (directly or indirectly) the Company and,
immediately after the consummation of such merger, consolidation or similar
transaction, the stockholders of the Company immediately prior thereto do not
own, directly or indirectly, outstanding voting securities representing more
than fifty percent (50%) of the combined outstanding voting power of the
surviving entity in such merger, consolidation or similar transaction or more
than fifty percent (50%) of the combined outstanding voting power of the parent
of the surviving entity in such merger, consolidation or similar transaction,
(B) there is consummated any transaction or series of related transactions to
which the Company is a party in which in excess of fifty percent (50%) of the
Company's voting power is transferred, or (C) a majority of the Board ceases to
consist of individuals (a) who are members of the Board as of the date of this
Agreement (the "Incumbent Board") or (b) whose election or nomination for
election by the Company's stockholders was approved by a majority of the
Incumbent Board; provided, however, that an Change of Control shall not include
(x) any consolidation or merger effected exclusively to change the domicile of
the Company, or (y) any transaction or series of transactions principally for
bona fide equity financing purposes in which cash is received by the Company or
indebtedness of the Company is cancelled or converted or a combination thereof;
provided, further, that any individual becoming a director subsequent to the
date of this Agreement whose election or nomination for election by the
Company's stockholders was approved by a majority of the directors then
comprising the Incumbent Board shall be considered as though such individual
were a member of the Incumbent Board;

                  (II) there is consummated a sale of assets, lease, license or
other disposition of all or substantially all of the consolidated assets of the
Company, other than a sale, lease, license or other disposition of all or
substantially all of the consolidated assets of the Company and its subsidiaries
to an entity, more than fifty percent (50%) of the combined voting power of the
voting securities of which are owned by stockholders of the Company in
substantially the same proportions as their ownership of the Company immediately
prior to such sale, lease, license or other disposition; or

                  (III) the stockholders of the Company approve or the Board
approves a plan of complete dissolution or liquidation of the Company, or a
complete dissolution or liquidation of the Company shall otherwise occur.

Notwithstanding the foregoing, a public offering (including the initial or any
subsequent public offering) of the Common Stock of the Company shall not be
considered a Change of Control. Once a Change of Control has occurred, no future
events will constitute a Change of Control for purposes of this Agreement.

            (D) "CONSTRUCTIVE TERMINATION" means Executive's voluntary
termination of employment after one of the following events occurs without
Executive's express written consent after a Change of Control:

                  (I) a substantial reduction in Executive's duties or
responsibilities (and not simply a change in title or reporting relationships)
in effect immediately prior to the effective date of the Change of Control;
provided, however, that it shall not be a "Constructive Termination" if the
Company is retained as a separate legal entity or business unit following the


                                       2.
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effective date of the Change of Control and Executive holds the same position in
such legal entity or business unit as Executive held before the effective date
of the Change of Control;

                  (II) a five percent (5%) or greater reduction by the Company
in Executive's Base Salary;

                  (III) a relocation of Executive's business office to a
location more than fifty (50) miles from Executive's business office on the date
hereof, except for required travel by Executive on the Company's business to an
extent substantially consistent with Executive's business travel obligations
prior to the date hereof;

                  (IV) a material breach by the Company of any provision of this
Agreement or of any other material agreement between Executive and the Company
concerning the terms and conditions of Executive's employment; or

                  (V) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company.

            (E) "COVERED TERMINATION" means an Involuntary Termination Without
Cause or a Constructive Termination, notice of either of which is given on or
after the date hereof.

            (F) "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's
dismissal or discharge for a reason other than Cause. "CAUSE" means the
occurrence of any one or more of the following:

                  (I) Executive's conviction of, or plea of no contest with
respect to, any felony or crime involving fraud, dishonesty or moral turpitude;

                  (II) Executive's attempted commission of or participation in a
fraud or act of dishonesty against the Company that results in (or might have
reasonably resulted in) material harm to the business of the Company;

                  (III) Executive's willful, material violation of any contract
or agreement between Executive and the Company or any statutory duty Executive
owes to the Company that results in, or might have reasonably resulted in,
material harm to the business of the Company; or

                  (IV) Executive's conduct that constitutes gross misconduct or
habitual neglect of duties and that results in (or might have reasonably
resulted in) material harm to the business of the Company.

            The conduct described under clause (iii) or (iv) above will only
constitute Cause if such conduct is not cured within fifteen (15) days after
Executive's receipt of written notice from the Company or the Board specifying
the particulars of the conduct that may constitute Cause.

            (A) "OPTIONS" shall mean any and all options granted to Executive by
the Company to acquire capital stock of the Company, whether granted prior to or
after the date of


                                       3.
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this Agreement (other than any options granted to Executive which expressly
provide that the terms and conditions of this Agreement shall not apply to such
options).

            (G) YEAR OF SERVICE" means any twelve (12) consecutive month period
of service with the Company.

      2. SEVERANCE PAYMENTS; ACCELERATION OF VESTING. Subject to Section 3, in
the event of the occurrence of a Change of Control, then, if Executive's
employment with the Company or its successor ceases by reason of Covered
Termination within the period beginning on the earlier of (a) one (1) month
prior to or (b) the date of the definitive agreement for the Change of Control
and ending thirteen (13) months following the effective date of the Change of
Control, then:

            (A) SALARY CONTINUATION. Executive shall continue to receive Base
Salary for a period of six (6) months commencing on the date of any Covered
Termination plus one (1) additional month for each complete Year of Service
performed by Executive in excess of two (2) Years of Service up to a maximum of
a twelve (12) month period of salary continuation (the "CONTINUATION PERIOD").
Such amounts shall be paid in regular installments on the normal payroll dates
of the Company and shall be subject to all required tax withholding.

            (B) CONTINUED INSURANCE BENEFITS. Provided that Executive elects
continued coverage under the Consolidated Omnibus Budget Reconciliation Act of
1985 ("COBRA"), the Company shall pay the premiums for Executive's group
medical, dental and vision coverage, including coverage for Executive's eligible
dependents for the Continuation Period or, if shorter, for the duration of the
COBRA continuation period; provided, however, that no such premium payments
shall be made following the effective date of Executive's coverage by a medical,
dental or vision insurance plan of a subsequent employer. Executive shall be
required to notify the Company in writing immediately if Executive becomes
covered by a medical, dental or vision insurance plan of a subsequent employer.

            No provision of this Agreement will affect the continuation coverage
rules under COBRA, except that the Company's payment of any applicable insurance
premiums during the Continuation Period will be credited as payment by Executive
for purposes of Executive's payments required under COBRA. Therefore, the period
during which Executive elect to continue the Company's group medical coverage at
his own expense under COBRA, the length of time during which COBRA coverage will
be made available to Executive, and all other rights and obligations of
Executive under COBRA (except the obligation to pay insurance premiums that the
Company pays during the Continuation Period) will be applied in the same manner
that such rules would apply in the absence of this Agreement. At the conclusion
of the Continuation Period, Executive shall be responsible for the entire
payment of premiums required under COBRA for the duration of the COBRA
continuation period. For purposes of this Section 2(b), applicable premiums that
will be paid by the Company during the Continuation Period shall not include any
amounts payable by Executive under a Section 125 health care reimbursement plan,
which amounts, if any, are the sole responsibility of Executive.

            (C) STOCK OPTIONS. As of the date of Executive's Covered
Termination, Executive's Options shall be vested as to an additional amount
equal to the number of shares


                                       4.
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subject to the Options that would have vested if Executive had been employed by
the Company for an additional twelve (12) months (the "ACCELERATED VESTING").
Executive shall have ninety (90) days from his termination date to exercise the
options subject to the Accelerated Vesting.

      3. RELEASE. Executive shall be entitled to the benefits set forth in
Section 2 of this Agreement provided that Executive executes and delivers to the
Company a general release and waiver of claims (following the date of the Change
of Control) in favor of the Company in substantially the form attached hereto as
EXHIBIT A (and such release and waiver becomes effective) and Executive has not
materially breached Executive's proprietary information and inventions
assignment agreement with the Company.

      4. LIMITATIONS ON BENEFITS.

            (A) OFFSET. If Executive has any other agreement or agreements with
the Company (the "OTHER AGREEMENTS") that relate, in whole or in part, to
severance benefits, whether or not such payments are contingent upon a Change of
Control, and including, without limitation, a provision in an employment
agreement for severance or a provision in a stock option agreement for
accelerated vesting of an option, then any benefits that may become payable to
Executive under this Agreement shall be offset by any benefits that may become
payable under the Other Agreements. The offset will allow Executive to receive
the greatest of each type of severance benefit available from the various
applicable agreements.

            (B) MITIGATION. Except as otherwise specifically provided herein,
Executive shall not be required to mitigate damages or the amount of any payment
provided under this Agreement by seeking other employment or otherwise, nor
shall the amount of any payment provided for under this Agreement be reduced by
any compensation earned by Executive as a result of employment by another
employer or any retirement benefits received by Executive after the date of the
Covered Termination.

            (C) INDEBTEDNESS OF EXECUTIVE. If Executive is indebted to the
Company or an affiliate of the Company at his termination date, the Company
reserves the right to offset any severance benefits under this Agreement by the
amount of such indebtedness.

            (D) PARACHUTE PAYMENTS. If any payment or benefit Executive would
receive in connection with a Change of Control from the Company or otherwise,
(collectively, the "PAYMENT") would (i) constitute a "parachute payment" within
the meaning of Section 280G of the Code, or any comparable successor provisions,
and (ii) but for this Section would be subject to the excise tax imposed by
Section 4999 of the Code, or any comparable successor provisions (the "Excise
Tax"), then such Payment shall be either (1) provided to such Executive in full,
or (2) provided to such Executive as to such lesser extent that would result in
no portion of such Payment being subject to the Excise Tax, whichever of the
foregoing amounts, when taking into account applicable federal, state, local and
foreign income and employment taxes, the Excise Tax, and any other applicable
taxes, results in the receipt by such Executive, on an after-tax basis, of the
greatest amount of the Payment, notwithstanding that all or some portion of the
Payment may be subject to the Excise Tax.


                                       5.
<PAGE>
      Unless the Company and such Executive otherwise agree in writing, any
determination required under this Section shall be made in writing in good faith
by the accounting firm engaged by the Company for general audit purposes (the
"ACCOUNTANT"). The Accountants engaged to make the determinations hereunder
shall provide their calculations, together with detailed supporting
documentation, to the Company and Executive within fifteen (15) calendar days
after the date on which Executive's right to a Payment is triggered (if
requested at that time by the Company or Executive) or such other time as
requested by the Company or Executive. If the accounting firm determines that no
Excise Tax is payable with respect to a Payment, either before or after the
application of the first paragraph of this Section, it shall furnish the Company
and Executive with an opinion reasonably acceptable to Executive that no Excise
Tax will be imposed with respect to such Payment. Any good faith determinations
of the accounting firm made hereunder shall be final, binding and conclusive
upon the Company and Executive. If a reduction in the Payment is to be made as
provided above, reductions shall occur in the following order unless Executive
elects in writing a different order (provided, however, that such election shall
be subject to Company approval if made on or after the date that triggers the
Payment or a portion thereof): reduction of cash payments; cancellation of
accelerated vesting of Options; reduction of employee benefits. If acceleration
of vesting of Options is to be reduced, such acceleration of vesting shall be
cancelled in the reverse order of date of grant of Options (i.e., earliest
granted Option cancelled last) unless Executive elects in writing a different
order for cancellation.

      For purposes of making the calculations required by this Section, the
Accountant may make reasonable assumptions and approximations concerning
applicable taxes and may rely on reasonable, good faith interpretations
concerning the application of the Code and other applicable legal authority. The
Company and Executive shall furnish to the Accountant such information and
documents as the Accountant may reasonably request in order to make such a
determination. The Company shall bear all costs the Accountant may reasonably
incur in connection with any calculations contemplated by this Section.

      If, notwithstanding any reduction described above, the Internal Revenue
Service (the "IRS") determines that Executive is liable for the Excise Tax as a
result of the Payment, then Executive shall be obligated to pay back to the
Company, within thirty (30) days after a final IRS determination or, in the
event that Executive challenges the final IRS determination, a final judicial
determination, a portion of the Payment equal to the "Repayment Amount." The
Repayment Amount with respect to the Payment shall be the smallest such amount,
if any, as shall be required to be paid to the Company so that Executive's net
after-tax proceeds with respect to the Payment (after taking into account the
payment of the Excise Tax and all other applicable taxes imposed on the Payment)
shall be maximized. The Repayment Amount with respect to the Payment shall be
zero if a Repayment Amount of more than zero would not result in Executive's net
after-tax proceeds with respect to the Payment being maximized. If the Excise
Tax is not eliminated pursuant to this paragraph, Executive shall pay the Excise
Tax.

      Notwithstanding any other provision of this Section, if (i) there is a
reduction in the Payment as described above, (ii) the IRS later determines that
Executive is liable for the Excise Tax, the payment of which would result in the
maximization of Executive's net after-tax proceeds of the Payment (calculated as
if the Payment had not previously been reduced), and (iii) Executive pays the
Excise Tax, then the Company shall pay or otherwise provide to Executive


                                       6.
<PAGE>
that portion of the Payment that was reduced pursuant to this Section
contemporaneously or as soon as administratively possible after Executive pays
the Excise Tax so that Executive's net after-tax proceeds with respect to the
Payment are maximized.

      If Executive either (i) brings any action to enforce rights pursuant to
this Section, or (ii) defends any legal challenge to his or her rights under
this Section, Executive shall be entitled to recover attorneys' fees and costs
incurred in connection with such action, regardless of the outcome of such
action; provided, however, that if such action is commenced by Executive, the
court finds that the action was brought in good faith.

      5. NO ADDITIONAL RIGHTS. This Agreement and the provisions herein shall
not be construed to be a grant to or modification of any right of Executive to
continued employment with the Company or its successor. Such right, if any,
shall be governed by any other employment agreements between Executive and the
Company. In particular, the definition of Involuntary Termination without Cause
shall not be deemed to be inclusive of all the acts or omissions which the
Company (or any affiliate of the Company) may consider as grounds for
Executive's dismissal or discharge.

      6. SUCCESSORS AND BINDING AGREEMENT.

            (A) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation, reorganization or otherwise) to
all or substantially all of the business or assets of the Company, by agreement
in form and substance satisfactory to Executive, expressly to assume and agree
to perform this Agreement in the same manner and to the same extent the Company
would be required to perform if no such succession had taken place. This
Agreement will be binding upon and inure to the benefit of the Company and any
successor to the Company, including without limitation any persons acquiring
directly or indirectly all or substantially all of the business or assets of the
Company whether or not through a Change of Control (and such successor shall
thereafter be deemed the "Company" for the purposes of this Agreement), but will
not otherwise be assignable, transferable or delegable by the Company.

            (B) This Agreement will inure to the benefit of and be enforceable
by Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees and legatees.

            (C) This Agreement is personal in nature and neither of the parties
hereto shall, without the consent of the other, assign, transfer or delegate
this Agreement or any rights or obligations hereunder except as expressly
provided in Section 6(a) hereof. Without limiting the generality or effect of
the foregoing, Executive's right to receive payments hereunder will not be
assignable, transferable or delegable, whether by pledge, creation of a security
interest, or otherwise, other than by a transfer by Executive's will or by the
laws of descent and distribution and, in the event of any attempted assignment
or transfer contrary to this Section, the Company shall have no liability to pay
any amount so attempted to be assigned, transferred or delegated.

      7. NOTICES. For all purposes of this Agreement, all communications,
including without limitation notices, consents, requests or approvals, required
or permitted to be given


                                       7.
<PAGE>
hereunder will be in writing and will be deemed to have been duly given when
hand delivered or dispatched by electronic facsimile transmission (with receipt
thereof orally confirmed), or five business days after having been mailed by
United States registered or certified mail, return receipt requested, postage
prepaid, or three business days after having been sent by a nationally
recognized overnight courier service such as Federal Express or UPS, addressed
to the Company (to the attention of the Secretary of the Company) at its
principal executive office and to Executive at his principal residence, or to
such other address as any party may have furnished to the other in writing and
in accordance herewith, except that notices of changes of address shall be
effective only upon receipt.

      8. VALIDITY. If any provision of this Agreement or the application of any
provision hereof to any person or circumstances is held invalid, unenforceable
or otherwise illegal, the remainder of this Agreement and the application of
such provision to any other person or circumstances will not be affected, and
the provision so held to be invalid, unenforceable or otherwise illegal will be
reformed to the extent (and only to the extent) necessary to make it
enforceable, valid or legal.

      9. MISCELLANEOUS. No provision of this Agreement may be modified, waived
or discharged unless such waiver, modification or discharge is agreed to in
writing signed by Executive and the Company. No waiver by either party hereto at
any time of any breach by the other party hereto or compliance with any
condition or provision of this Agreement to be performed by such other party
will be deemed a waiver of similar or dissimilar provisions or conditions at the
same or at any prior or subsequent time. No agreements or representations, oral
or otherwise, expressed or implied with respect to the subject matter hereof
have been made by either party which are not set forth expressly in this
Agreement. References to Sections are to references to Sections of this
Agreement.

      10. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same agreement.

      11. ATTORNEYS FEES AND COSTS. Subject to the last sentence of Section 3,
in any legal action in a court of competent jurisdiction to enforce the terms of
this Agreement, the prevailing party (as determined by a court of competent
jurisdiction) shall be entitled to his or its reasonable attorneys fees and
court costs in the action.

      12. EMPLOYMENT RIGHTS; TERMINATION PRIOR TO CHANGE OF CONTROL. Nothing
expressed or implied in this Agreement will create any right or duty on the part
of the Company or Executive to have Executive remain in the employment of the
Company or any subsidiary prior to or following any Change of Control.

      13. WITHHOLDING OF TAXES. The Company may withhold from any amounts
payable under this Agreement all federal, state, city or other taxes as the
Company is required to withhold pursuant to any law or government regulation or
ruling.

      14. JURISDICTION AND GOVERNING LAW. Jurisdiction and venue in any action
to interpret or enforce the terms of this Agreement shall be in the State of
California and in the


                                       8.
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County of Santa Clara of the State of California. This Agreement shall be
governed by the laws of the State of California other than the choice of laws
principles of the laws of that state.


                                       9.
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      IN WITNESS WHEREOF, the parties hereto have executed this EXECUTIVE CHANGE
OF CONTROL AGREEMENT as of the date set forth in the first paragraph hereof.

COMPANY:                                   EXECUTIVE:

PENINSULA PHARMACEUTICALS, INC.

By:   /s/ Stan E. Abel                     /s/ Paul F. Truex
     --------------------------            ---------------------------
                                           Paul F. Truex

Name:  Stan E. Abel
       ------------------------

Title:  Chief Financial Officer
       ------------------------


                      EXECUTIVE CHANGE OF CONTROL AGREEMENT
                                 SIGNATURE PAGE
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                                    EXHIBIT A

                                FORM OF RELEASE

                                RELEASE AGREEMENT

         I UNDERSTAND AND AGREE COMPLETELY TO THE TERMS SET FORTH IN MY
EXECUTIVE CHANGE IN CONTROL AGREEMENT WITH PENINSULA PHARMACEUTICALS, INC. (THE
"AGREEMENT") AND THIS RELEASE.

         I understand that this Release, together with the Agreement,
constitutes the complete, final and exclusive embodiment of the entire agreement
between the Company and me with regard to the subject matter hereof. I am not
relying on any promise or representation by the Company that is not expressly
stated therein. Certain capitalized terms used in this Release are defined in
the Plan.

         I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.

         Except as otherwise set forth in this Release, I hereby generally and
completely release the Company and its parents, subsidiaries, successors,
predecessors and affiliates, and its and their partners, members, directors,
officers, employees, stockholders, shareholders, agents, attorneys,
predecessors, insurers, affiliates and assigns, from any and all claims,
liabilities and obligations, both known and unknown, that arise out of or are in
any way related to events, acts, conduct, or omissions occurring at any time
prior to and including the date I sign this Release. This general release
includes, but is not limited to: (a) all claims arising out of or in any way
related to my employment with the Company or the termination of that employment;
(b) all claims related to my compensation or benefits, including salary,
bonuses, commissions, vacation pay, expense reimbursements, severance pay,
fringe benefits, stock, stock options, or any other ownership interests in the
Company; (c) all claims for breach of contract, wrongful termination, and breach
of the implied covenant of good faith and fair dealing; (d) all tort claims,
including claims for fraud, defamation, emotional distress, and discharge in
violation of public policy; and (e) all federal, state, and local statutory
claims, including claims for discrimination, harassment, retaliation, attorneys'
fees, or other claims arising under the federal Civil Rights Act of 1964 (as
amended), the federal Americans with Disabilities Act of 1990 (as amended), the
federal Age Discrimination in Employment Act (as amended), the federal Employee
Retirement Income Security Act of 1974 (as amended), and the California Fair
Employment and Housing Act (as amended). Provided, however, that nothing in this
paragraph shall be construed in any way to release the Company from its
obligation to indemnify me pursuant to agreement or applicable law.

         I acknowledge that I have read and understand Section 1542 of the
California Civil Code 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." I hereby expressly waive and
relinquish all rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any claims
hereunder.
<PAGE>
         I acknowledge that to become effective, I must sign and return this
Release to the Company so that it is received not later than fifteen (15) days
following the date of my employment termination.

                                           EMPLOYEE



                                           Name:
                                                --------------------------------

                                           Date:
                                                --------------------------------