Document:

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                                                                    Exhibit 10.1

                                November 16, 2004

PERSONAL AND CONFIDENTIAL

Mr. Dean J. Mitchell
c/o Guilford Pharmaceuticals Inc.
6611 Tributary Street
Baltimore, MD 21224

RE:      OFFER OF EMPLOYMENT

Dear Dean:

         On behalf of the Board of Directors of Guilford Pharmaceuticals Inc.
(the "Company"), we are pleased to offer you employment with the Company,
effective on December 1, 2004 or such earlier date as you and we otherwise
agree, subject to an extension up until January 1, 2005 if necessary to obtain
the necessary immigration documentation to permit you to commence employment
with the Company, on the following terms and conditions:

         1.       Your title will be President and Chief Executive Officer. In
                  this capacity, you will report directly to the Board of
                  Directors (the "Board") and have the responsibilities,
                  authority and duties commensurate with such positions in
                  similarly situated companies and such other positions and
                  duties with the Company and its affiliates as not inconsistent
                  with your position may be assigned to you by the Board.
                  Additionally, the Board has approved, subject to your
                  commencement of employment with the Company as President and
                  Chief Executive Officer, your appointment to the Company's
                  Board. You will continue to serve on the Board until the next
                  annual meeting of the Company's stockholders and until your
                  successor is duly elected and qualified. Of course like all
                  directors of the Company, you may be re-nominated to serve on
                  the Board for additional one-year terms, as determined by the
                  Board on an annual basis.

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         2.       In consideration of your services, the Company will provide
                  the following compensation:

                  a.       SALARY: Your salary will be at least $45,833 per
                           month (an annual rate of $550,000), payable in
                           semi-monthly increments (as increased from time to
                           time, "Base Salary"). Your performance and
                           compensation will be reviewed by the Board annually
                           in accordance with the Company's performance
                           management process at least annually for increase,
                           but shall not be decreased at any time below $45,833
                           per month.

                  b.       ANNUAL CASH INCENTIVE PLAN: As an officer of the
                           Company, you will be eligible to participate in any
                           incentive plan the Board may adopt from time to time
                           for executive officers of the Company. The Company's
                           incentive plan is based on attainment of corporate
                           objectives and is further influenced by individual
                           performance. Specific goals will be mutually agreed
                           upon between yourself and the Board. Your annual
                           target cash incentive will be 50% of Base Salary.

                           Notwithstanding the foregoing your cash incentive for
                           2005 will be $275,000 (the "Guaranteed Incentive"),
                           and shall be paid to you after you have been
                           continuously employed by the Company for a period of
                           12 consecutive months.

                  c.       STOCK OPTIONS:

                           (i) SIGN-ON GRANT. Upon the commencement of your
                           employment as an inducement grant, you will be
                           awarded options to purchase 1,000,000 shares of the
                           Company's common stock (the "Sign-On Grant"), subject
                           to the terms and conditions of the stock option
                           agreement attached hereto as Exhibit A. The price of
                           the options will be the closing price of Guilford's
                           stock on the trading date immediately preceding your
                           first day of employment with the Company. These
                           options will vest as follows: 25% of your options
                           will vest on the first anniversary of the grant. The
                           remaining options in the Sign-On Grant will vest in
                           equal monthly installments over the next 36 months,
                           provided that the options shall vest in full upon a
                           Disability termination by the Company or a
                           termination by reason of your death.

                           (ii) INCENTIVE AWARDS. In accordance with the
                           Company's long-term incentive program, you will be
                           eligible to receive awards of options to

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                           purchase the Company's common stock, at a level
                           commensurate with your position, as determined from
                           time to time by the Compensation Committee of the
                           Board. For each of the first two years of your
                           employment, you will be entitled to receive this
                           incentive award in the amount of options for 250,000
                           shares. For the avoidance of doubt, you will receive
                           these awards during February 2006 and 2007
                           conditioned on your continued employment with the
                           Company at the applicable time. Thereafter,
                           participation in the long- term incentive program
                           will be based on Company and personal performance as
                           determined by the Board. The face value of your
                           annual target award will then be equal to two times
                           your annual salary at the date awards are authorized
                           by the Compensation Committee. All incentive awards
                           are made in accordance with the Company's standard
                           award and vesting terms and conditions as in effect
                           from time to time. For your information, incentive
                           awards have been made during February of each year in
                           the past.

                           (iii) RESTRICTED STOCK AND RESTRICTED STOCK UNITS. As
                           a sign on inducement, upon the commencement of your
                           employment, you will be granted under the Company's
                           long-term incentive program 50,000 shares of the
                           Company's Common Stock that will be fully vested upon
                           grant. Within fifteen (15) days after the
                           commencement of your employment as a sign on
                           inducement, you will be granted (x) 250,000
                           restricted shares of the Company's Common Stock that
                           will vest on the first anniversary of your employment
                           with the Company or earlier upon an Acceleration
                           Event (provided that, if an Acceleration Event occurs
                           prior to such grant, you will be granted 250,000
                           fully vested shares at the time of the Acceleration
                           Event) and (y) 250,000 restricted shares of the
                           Company's Common Stock, vesting seven years from the
                           commencement of your employment. Based on terms and
                           conditions to be mutually determined between yourself
                           and the Board within 90 days of the commencement of
                           your employment and subject to the Company achieving
                           certain performance milestones, vesting on these
                           shares can accelerate to calendar years 2007, 2008
                           and 2009. Such grants shall be in the form of Exhibit
                           B hereto. You shall also receive, as a sign on
                           inducement within such fifteen (15) day period, a
                           restricted stock unit grant in the form of Exhibit C
                           that will vest on the earlier of February 12, 2011 or
                           the date of a change of control (as defined in the
                           attached Executive Change of Control and Severance
                           Agreement) and so long as you remain employed as our
                           Chief Executive Officer through that date you will
                           receive shares of the Company's

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                           Common Stock (subject to any applicable adjustment
                           necessary so that these units satisfy the
                           requirements of Internal Revenue Code Section 409A)
                           in an amount equal to the quotient of $1 million
                           divided by the average closing price for each trading
                           day in the month preceding the payout date, but in no
                           event will the vested number of shares exceed 100,000
                           shares (adjusted for splits and recapitalization
                           events. With respect to any of the restricted shares
                           and restricted stock units provided to you pursuant
                           to this subsection (iii), if your employment with the
                           Company is terminated for Cause (as defined in
                           numbered paragraph 5 below) or you voluntarily
                           terminate your employment with the Company , the
                           unvested portion of the restricted shares and
                           restricted stock units will be forfeited and returned
                           to the Company.

                           (iv) Equity grants shall in no event be subject to
                           any forfeiture or clawback provisions nor to any
                           cutback to comply with a limit under Internal Revenue
                           Code Section 280G. All restricted stock and
                           restricted stock units shall be dividend paying.

                           (v) Following the termination of your employment
                           other than for Cause, you will be entitled to
                           exercise your vested stock options for a period of
                           (A) one year if you have been employed by the Company
                           for less than three consecutive years, or (B) three
                           years if you have been employed by the Company for
                           three or more consecutive years, except in the case
                           of a Change in Control of the Company (which will be
                           governed by Exhibit A), or where the terms of an
                           applicable stock option grant may provide you with a
                           longer period of time to exercise that stock option
                           grant.

                           (vi) SECURITIES COMPLIANCE. All grants made hereunder
                           shall be covered by an S-8, or a replacement therefor
                           (including a resale prospectus) and such documents
                           shall be kept active. The S-8 for the restricted
                           stock and restricted stock units will be effective
                           prior to their grant and the S-8 for the Options will
                           be effective prior to their vesting.

                  d.       EXECUTIVE CHANGE IN CONTROL SEVERANCE AGREEMENT: As
                           the President and Chief Executive Officer of the
                           Company, you will be entitled to certain benefits in
                           the event of a change in control of the Company, as
                           set forth in the attached Executive Change in Control
                           Severance Agreement, in addition to the restricted
                           stock unit payout described above. Under certain
                           conditions related to the change in control of the
                           Company, you may receive an amount equal to three

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                           times your Base Salary, accelerated vesting of
                           outstanding options, and benefits continuation for up
                           to two years. The benefits are described in numbered
                           paragraph 3, below.

                  e.       JOINING BONUS: Upon the commencement of your
                           employment with the Company, you will receive a cash
                           payment in the amount of $100,000 (the "Joining
                           Bonus"), as a bonus for your joining the Company. The
                           Joining Bonus shall be refundable by you to the
                           Company, ratably, if your employment with the Company
                           terminates prior to one year after you have commenced
                           employment with the Company for Cause or you
                           voluntarily terminate your employment with the
                           Company (other than in connection with an
                           Acceleration Event).

              3.           ADDITIONAL BENEFITS. In addition to the compensation
                           described above, you will be eligible for the
                           following benefits:

                  a.       SUPPLEMENTAL DISABILITY INSURANCE: In addition to the
                           group disability insurance offered by the Company, as
                           President and Chief Executive Officer of the Company,
                           you will be eligible to apply for a supplemental
                           long-term disability policy paid for by the Company
                           and underwritten by a life insurance company selected
                           by the Company. This plan is subject to standard
                           underwriting requirements. Please see the attached
                           summary example of this important benefit.

                  b.       INSURANCE: The Company offers comprehensive medical,
                           dental, vision, life, accidental death, short-term
                           and long-term disability insurance as described in
                           the Employee Benefits Overview.

                  c.       FINANCIAL PLANNING ASSISTANCE: You will be reimbursed
                           up to $10,000 each calendar year for financial
                           planning services provided by a qualified tax
                           accountant, financial planner or other similar
                           service.

                  d.       VACATION AND HOLIDAYS: You will be entitled to 20
                           vacation days during your first year of employment;
                           thereafter, a vacation day will be added annually, up
                           to a maximum of 25 vacation days. Also, the Company
                           offers paid specified holidays (currently 11).

                  e.       401(k) PLAN: You may elect to join Company's 401(k)
                           Plan at the quarterly enrollment date following your
                           date of hire. You will be eligible to receive the
                           Company match subject to the terms and

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                           conditions of such plan as may be in effect from time
                           to time. Guilford currently matches 50% of the first
                           6% of employee salary deferral in the form of newly
                           issued Guilford stock. Subject to applicable laws,
                           you may reallocate the Company match to other funds
                           within the plan once the quarterly match has been
                           made. The annual maximum contribution for 2005 is
                           $14,000. An additional $4,000 may be contributed for
                           those at age 50, subject to IRS limitations.

                  f.       EMPLOYEE STOCK PURCHASE PLAN: From time to time, the
                           Company offers the opportunity to participate in an
                           Employee Stock Purchase Plan. If you elect to
                           participate, you may contribute from 1% to 15% of
                           your regular salary to purchase shares under the
                           Plan. However, you may not purchase more than $25,000
                           worth of the Company's stock during any calendar
                           year.

                  g.       ATTORNEY COSTS: Since it is of benefit to the Company
                           for you to be represented by counsel in this matter,
                           the Company will pay the reasonable fees and expenses
                           of your attorney to review this documentation on your
                           behalf, up to a total cost of $10,000. It is
                           understood that you and your attorney will
                           independently evaluate the tax treatment to you of
                           the compensation arrangements described herein and
                           that you will independently determine what, if any,
                           tax elections you may make with respect to those
                           arrangements.

         4.       OTHER CONDITIONS OF EMPLOYMENT. This offer of employment at
                  will is conditioned on:

                           (i)      your compliance with relevant requirements
                                    under the Immigration Reform Act of 1986,
                                    including presentation of documentation that
                                    proves your identity and legal right to work
                                    in the United States (the Company will
                                    assist you in, sponsor you as necessary in,
                                    and pay the costs of the process of
                                    obtaining or continuing your Green Card
                                    application and in obtaining any other work
                                    or residence visas you require or desire to
                                    obtain.) If you are nevertheless unable to
                                    commence full-time employment with the
                                    Company in the United States due to your
                                    immigration status prior to January 1, 2005,
                                    or if thereafter you cease to be legally
                                    employed in the United States, the Company
                                    will be entitled to terminate its
                                    obligations under this Agreement with the
                                    same effect, respectively as a termination
                                    for Cause or a termination without Cause
                                    (but with no amounts due under

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                                    Section 6(b) and without such occurrence
                                    being deemed an Acceleration Event);

                           (ii)     your signing a Patent and Confidentiality
                                    Agreement in connection with your employment
                                    by the Company;

                           (iii)    successful completion of a background
                                    investigation; and

                           (iv)     your taking and successfully passing the
                                    included drug screen, which should be
                                    scheduled at your earliest convenience and
                                    our expense.

         5.       TERMINATION. Your employment shall terminate upon the
                  occurrence of the first of the following:

                  a.       your death;

                  b.       notice from the Company as a result of your
                           Disability given while such Disability is continuing.
                           Disability shall mean your failure to perform your
                           material duties for the Company for six (6)
                           consecutive months because of your physical or mental
                           incapacity;

                  c.       Termination by the Company for Cause after written
                           notice of the alleged Cause event has been given to
                           you;

                  d.       Termination by the Company without Cause upon written
                           notice;

                  e.       Termination by you for Good Reason upon written
                           notice; or

                  f.       Termination by you voluntarily without Good Reason
                           upon written notice.

         6.       EXECUTIVE SEVERANCE:

                  a.       In the event your employment terminates for any
                           reason whatsoever, you shall receive: (i) all regular
                           Base Salary due up to the date of termination; (ii)
                           any accrued but unused vacation (if and to the extent
                           consistent with the Company's policies), (iii) any
                           incurred but unreimbursed business expenses, (iv) if
                           it has not previously been paid to you, any incentive
                           compensation due to you for any fiscal year ending
                           prior to the effective date of such termination, (v)
                           other than in

<PAGE>

                           the case of a Termination for Cause or a voluntary
                           termination without Good Reason, a pro rata incentive
                           compensation payment for the year of termination
                           based on actual results for the year with respect to
                           the Company, payable when bonuses to other senior
                           executives are paid, (vi) any accrued rights under
                           any benefit or equity plan, program or practice, and
                           (vii) your rights to indemnification and directors
                           and officers liability insurance.

                  b.       In addition, in the event your employment is
                           terminated by the Company other than for Cause or by
                           you for Good Reason (subject to the Change in Control
                           Agreement), you shall also be entitled to severance
                           payments in the form of a continuation of your
                           highest Base Salary in the preceding 12 months for 24
                           months (the applicable period of salary continuance
                           is referred to as the "Severance Period"). Such
                           amounts shall be paid without any obligations to
                           mitigate and no offset for other amounts earned by
                           you. Such payments and any additional benefits are
                           conditioned upon the execution of Separation
                           Agreement and General Release, a copy of which is
                           attached as Exhibit D. During the Severance Period,
                           the Company would also reimburse you for the cost of
                           continuation of any health and life insurance
                           coverage available at the time of the termination of
                           employment, provided that the Company reserves the
                           right to provide substantially equivalent alternative
                           coverage to the extent reasonably available upon
                           conversion from full-time employment, which coverage
                           shall provide no lesser benefit than the coverage
                           provided by the Company. Such continuing coverage is
                           conditioned upon your reasonable cooperation in
                           complying with any necessary application procedures.
                           Remaining benefits of employment, including your
                           eligibility for any incentive program and the vesting
                           of unvested options would cease at termination and
                           not continue to accrue during the Severance Period,
                           except as otherwise provided herein or in any grant
                           or program. Also in the event your employment is
                           terminated by the Company other than for Cause or by
                           you for Good Reason (subject to the Change in Control
                           Agreement), you shall also be entitled to
                           outplacement support through Right Management
                           Consultants' CEO level program, provided you initiate
                           participation in the outplacement program within 60
                           days of the date of such termination of employment.

                  c.       For the purposes of this letter, the term "Cause"
                           means (i) your being convicted of a crime involving
                           fraud or theft against the Company or of

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                           a felony involving moral turpitude; or (ii) you have
                           (x) improperly disclosed material trade secrets or
                           other proprietary information of the Company, other
                           than in good faith performance of your duties, (y)
                           willfully failed or refused to attempt in good faith
                           to perform your material legally assigned duties with
                           regard to the Company (other than as a result of
                           physical or mental incapacity), or (z) engaged in
                           gross negligence or willful misconduct with regard to
                           the Company that causes substantial and material harm
                           to the business and operations of the Company.

                  d.       For the purposes of this letter, the term "Good
                           Reason" means the occurrence of any of the following
                           events, unless such event is fully corrected within
                           ten (10) days following written notification by you
                           to the Company that you intend to terminate your
                           employment hereunder for one of the reasons set forth
                           below, or you have concurred in writing with any of
                           the events described below: (i) a diminution in your
                           title, (ii) a material breach by the Company of any
                           material provision of this Agreement; (iii) the
                           Company's requiring you to be based anywhere other
                           than within fifty (50) miles of the Company's current
                           executive offices or other than in the executive
                           offices; (iv) you are not nominated or renominated to
                           the Board, other than (a) by your choice or agreement
                           not to stand for election or reelection, or (b) in a
                           circumstance under which your employment has been
                           terminated for Cause; or (v) after a Change in
                           Control, you are no longer Chief Executive Officer of
                           a public company.

                  e.       For the purposes of this letter, the term
                           "Acceleration Event" means a Disability termination,
                           a termination by reason of your death, a termination
                           without Cause and a termination for Good Reason.

         7.       RESOLUTION OF DISPUTES: Any dispute or controversy arising
                  under or in connection with this Agreement shall be settled
                  exclusively by arbitration administered by the American
                  Arbitration Association and conducted before one arbitrator in
                  Baltimore, Maryland, all in accordance with its Commercial
                  Arbitration rules then in effect. The decision of the
                  arbitrator shall be final and binding and may be entered in
                  any court of competent jurisdiction. In the event of any
                  dispute in connection with this Agreement, if the arbitrator
                  determines that you have prevailed in such dispute, you shall
                  be awarded your reasonable legal fees, disbursements and
                  costs.

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         8.       INDEMNIFICATION: You shall be indemnified to the fullest
                  extent permitted by law and you shall be covered by director
                  and officer liability insurance, both during and after
                  termination of your employment and directorship (with regard
                  to your service period), in the maximum amount provided to any
                  other officer or director of the Company.

         9.       BOILERPLATE: This is the entire agreement between the parties
                  hereto with regard to the subject matter hereof. The validity,
                  interpretation, construction and performance of this Agreement
                  shall be governed by the laws of the State of Maryland,
                  without regard to any conflicts of laws provisions thereof. It
                  may not be amended orally, but only by a writing executed by
                  the party to be charged. This Agreement shall be binding upon
                  and inure to the benefit of the parties and their permitted
                  assigns. You may not assign this Agreement, except that on
                  your death any amounts due you shall be paid to your estate or
                  designated beneficiary. The Company may assign this Agreement
                  only to an acquirer of all or substantially all of its assets
                  and only if such acquirer promptly delivers to you a written
                  assumption of this Agreement.

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         Please indicate your agreement to the terms and conditions set forth in
this letter by counter signing this letter and returning it to the attention of
George L. Bunting, Jr., c/o Asher M. Rubin, Secretary by facsimile, to
(410)631-6899, on or before November 17, 2004, at 5:00 p.m., after which date
and time this offer shall become null and void.

                                      Very truly yours,

                                      On behalf of the Board of Directors of

                                      GUILFORD PHARMACEUTICALS INC.

                                          By:
                                             -----------------------------------
                                             George L. Bunting, Jr.
                                             Director

Agreed to and accepted as of this    day of November 2004:
                                  --

----------------------------------
Dean J. Mitchell

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                                                                       EXHIBIT A

                          GUILFORD PHARMACEUTICALS INC.
                        EXECUTIVE STOCK OPTION AGREEMENT

                  Guilford Pharmaceuticals Inc., a Delaware corporation (the
"Company"), hereby grants an option to purchase shares of its common stock, $.01
par value, (the "Stock") to the Grantee named below, subject to the vesting
conditions set forth in the attachment.

Grant Date:        -   , 2004
            -------  --

Name of Grantee: Dean J. Mitchell

Grantee's Social Security Number:       -    -
                                   ----- ---- -----

Number of Shares of Stock Covered by Grant:  1,000,000

         BY SIGNING THIS COVER SHEET, YOU AGREE TO ALL OF THE TERMS AND
CONDITIONS DESCRIBED IN THE ATTACHED AGREEMENT.

Grantee:
                  --------------------------------------------------------------
                                          (Signature)

Company:
                  --------------------------------------------------------------
                                         (Signature)

                  Title:
                          ------------------------------------------------------

Attachment

                  This is not a stock certificate or a negotiable instrument.

<PAGE>

                          GUILFORD PHARMACEUTICALS INC.
                        EXECUTIVE STOCK OPTION AGREEMENT

NONQUALIFIED STOCK OPTION               This option is not intended to be an
                                        incentive stock option under Section 422
                                        of the Internal Revenue Code and will be
                                        interpreted accordingly.

EXERCISE AND VESTING                    This option is only exercisable before
                                        it expires and then only with respect to
                                        the vested portion of the option.
                                        Subject to the preceding sentence, you
                                        may exercise this option, in whole or in
                                        part, to purchase a whole number of
                                        vested shares not less than 100 shares,
                                        unless the number of shares purchased is
                                        the total number available for purchase
                                        under the option, by following the
                                        procedures set forth in this Agreement.

                                        Your right to purchase shares of Stock
                                        under this option vests, contingent on
                                        your continued Service, as to:

                                        o    250,000 shares shall be vested on
                                             the first anniversary of the Grant
                                             Date.

                                        o    1/48th of the total number of
                                             shares subject to this Option as
                                             set forth on the cover sheet shall
                                             vest in equal monthly installments
                                             on the first day of each month
                                             following the month in which the
                                             first anniversary of the Grant Date
                                             occurs.

                                        o    100% of the shares subject to this
                                             Agreement shall become vested, to
                                             the extent not already vested,
                                             upon: (a) your termination of
                                             Service because of your death or
                                             Disability (as defined in the Offer
                                             Letter), or (b) a Change in Control
                                             (as defined in the Executive Change
                                             in Control and Severance Agreement
                                             between you and the Company dated
                                             ____________ __, 2004).

                                        o    The resulting aggregate number of
                                             vested shares will be rounded down
                                             to the nearest whole number (with
                                             cash paid for any fractional
                                             shares), and you cannot vest in
                                             more than the number of shares
                                             covered by this option. No
                                             additional shares of Stock will
                                             vest after your Service has
                                             terminated for any reason.

<PAGE>

                                        For the purpose of this Agreement,
                                        "Service" means service as an employee,
                                        officer, director or other service
                                        provider of the Company or an affiliate
                                        of the Company. Your change in position
                                        or duties shall not result in
                                        interrupted or terminated Service, so
                                        long as such you continue to be an
                                        employee, officer, director or other
                                        service provider of the Company or its
                                        affiliate. Subject to the preceding
                                        sentence, whether a termination of
                                        Service shall have occurred for purposes
                                        of this Agreement shall be determined by
                                        the Board of Directors of the Company
                                        (the "Board"), which determination shall
                                        be final, binding and conclusive.

TERM                                    Your option will expire in any event at
                                        the close of business at Company
                                        headquarters on the day before the 10th
                                        anniversary of the Grant Date, as shown
                                        on the cover sheet. Your option will
                                        expire earlier (but not later) if your
                                        Service terminates, as described below,
                                        and may be terminated prior to its
                                        expiration date in the event of a
                                        merger, liquidation or reorganization
                                        involving the Company.

TERMINATION OF SERVICE                  If your Service terminates for any
                                        reason other than for Cause (as defined
                                        in the Offer Letter) or as a result of
                                        your retirement (as provided for in the
                                        section of this Agreement entitled
                                        "Retirement"), then your option will
                                        expire at the close of business at
                                        Company headquarters (a) one year after
                                        your termination of Service if you have
                                        been employed by the Company for less
                                        than three consecutive years at the time
                                        of your termination of Service or (b)
                                        three years after your termination if
                                        you have been employed by the Company
                                        for at least three years at the time of
                                        your termination of Service. Your option
                                        shall expire immediately upon your
                                        termination for Cause.

DEATH                                   If your Service terminates because of
                                        your death, then your estate or heirs
                                        may exercise your option prior to its
                                        expiration.

<PAGE>

                                        In addition, if you die during the one
                                        or three year period described above in
                                        "Termination of Service," your estate or
                                        heirs may exercise the vested portion of
                                        your option prior to its expiration.

RETIREMENT                              If your Service terminates because of
                                        your retirement after you have reached
                                        age 55, then

                                        o    if you have at least five years of
                                             Service and your age plus the
                                             number of years of your Service
                                             equals at least 62, then your
                                             option shall expire five years
                                             after your termination of Service.

                                        o    if you have at least ten years of
                                             Service and your age plus the
                                             number of years of Service equals
                                             at least 65, then your option shall
                                             expire at the end of its term.

NOTICE OF EXERCISE                      When you wish to exercise this option,
                                        you must notify the Company by filing
                                        the proper "Notice of Exercise" form at
                                        the address given on the form. Your
                                        notice must specify how many shares you
                                        wish to purchase (in a parcel of at
                                        least 100 shares generally). Your notice
                                        must also specify how your shares of
                                        Stock should be registered (in your name
                                        only or in your and your spouse's names
                                        as joint tenants with right of
                                        survivorship). The notice will be
                                        effective when it is received by the
                                        Company.

                                        If someone else wants to exercise this
                                        option after your death, that person
                                        must prove to the Company's satisfaction
                                        that he or she is entitled to do so.

FORM OF PAYMENT                         When you submit your notice of exercise,
                                        you must include payment of the option
                                        price for the shares you are purchasing.
                                        Payment may be made in one (or a
                                        combination) of the following forms:

                                        o     Cash, your personal check, a
                                              cashier's check, a money order or
                                              another cash equivalent acceptable
                                              to the Company.

                                        o     Shares of Stock which have already
                                              been owned by

<PAGE>

                                              you for more than six months and
                                              which are surrendered to the
                                              Company. The value of the shares,
                                              determined as of the effective
                                              date of the option exercise, will
                                              be applied to the option price.

                                        o     By delivery (on a form prescribed
                                              by the Company) of an irrevocable
                                              direction to a licensed securities
                                              broker acceptable to the Company
                                              to sell Stock and to deliver all
                                              or part of the sale proceeds to
                                              the Company in payment of the
                                              aggregate option price and any
                                              withholding taxes.

WITHHOLDING TAXES                       You will not be allowed to exercise this
                                        option unless you make acceptable
                                        arrangements to pay any withholding or
                                        other taxes that may be due as a result
                                        of the option exercise or sale of Stock
                                        acquired under this option. In the event
                                        that the Company determines that any
                                        federal, state, local or foreign tax or
                                        withholding payment is required relating
                                        to the exercise or sale of shares
                                        arising from this grant, the Company
                                        will have the right to: (i) require that
                                        you arrange such payments to the
                                        Company, or (ii) withhold such amounts
                                        from other payments due to you from the
                                        Company or any affiliate. In the
                                        alternative and only if the Company
                                        grants its approval, you may elect to
                                        satisfy the minimum required withholding
                                        requirements by forfeiting to the
                                        Company shares of Stock acquired
                                        pursuant to this Agreement in an amount
                                        equal to the withholding or other taxes
                                        due.

TRANSFER OF OPTION                      Except as provided in this section,
                                        during your lifetime, only you (or, in
                                        the event of your legal incapacity or
                                        incompetency, your guardian or legal
                                        representative) may exercise the option
                                        and you may not transfer or assign this
                                        option.

                                        You may transfer the option to (i) your
                                        spouse, children or grandchildren
                                        ("Immediate Family Members"), (ii) a
                                        trust or trusts for the exclusive
                                        benefit of your Immediate Family
                                        Members, or (iii) a partnership in which
                                        your Immediate Family Members are the
                                        only partners, provided that (x) there
                                        may be no

<PAGE>

                                        consideration for any such transfer and
                                        (y) subsequent transfers of the option
                                        are prohibited except those in
                                        accordance with this section, or by will
                                        or the laws of descent and distribution.
                                        Following transfer, the option shall
                                        continue to be subject to the same terms
                                        and conditions as were applicable
                                        immediately prior to transfer, provided
                                        that for purposes of this option the
                                        term "you" or "your" shall be deemed to
                                        refer to your transferee. The provisions
                                        relating to termination of Service set
                                        forth above shall continue to be applied
                                        with respect to you and your
                                        transferees, following which the option
                                        shall be exercisable by the transferee
                                        only to the extent, and for the periods,
                                        specified in this Agreement.

                                        Regardless of any marital property
                                        settlement agreement, the Company is not
                                        obligated to honor a notice of exercise
                                        from your spouse, nor is the Company
                                        obligated to recognize your spouse's
                                        interest in your option in any other
                                        way.

SHAREHOLDER RIGHTS                      You, or your estate or heirs, have no
                                        rights as a shareholder of the Company
                                        until a certificate for your option's
                                        shares has been issued (or an
                                        appropriate book entry has been made).
                                        No adjustments are made for dividends or
                                        other rights if the applicable record
                                        date occurs before your stock
                                        certificate is issued (or an appropriate
                                        book entry has been made).

ADJUSTMENTS                             In the event of a stock split, a stock
                                        dividend or a similar change in the
                                        Stock, the number of shares covered by
                                        this option and the option price per
                                        share shall be adjusted (and rounded
                                        down to the nearest whole number) if
                                        determined to be appropriate by the
                                        Board.

                                        Subject to the next paragraph, if the
                                        Company shall be the surviving entity in
                                        any reorganization, merger or
                                        consolidation of the Company with one or
                                        more other entities, the Option shall
                                        pertain to and apply to the securities
                                        to which a holder of the number of
                                        Shares subject to the Option would have
                                        been entitled immediately following such
                                        reorganization, merger or

<PAGE>

                                        consolidation, with a corresponding
                                        proportionate adjustment of the Option
                                        Price per Share so that the aggregate
                                        Option Price thereafter shall be the
                                        same as the aggregate Option Price of
                                        the Shares remaining subject to the
                                        Option immediately prior to such
                                        reorganization, merger or consolidation.

                                        Upon the dissolution or liquidation of
                                        the Company, or upon a merger,
                                        consolidation or reorganization of the
                                        Company with one or more other entities
                                        in which the Company is not the
                                        surviving entity, or upon a sale of
                                        substantially all of the assets of the
                                        Company to another entity, or upon any
                                        transaction (including, without
                                        limitation, a merger or reorganization
                                        in which the Company is the surviving
                                        entity) approved by the Board which
                                        results in any person or entity (or
                                        persons or entities acting as a group or
                                        otherwise in concert) owning 80 percent
                                        or more of the combined voting power of
                                        all classes of securities of the
                                        Company, the Option hereunder shall
                                        terminate, except to the extent
                                        provision is made in connection with
                                        such transaction for the continuation
                                        and/or the assumption of the Option, or
                                        for the substitution for the Option of
                                        new options covering the stock of a
                                        successor employer entity, or a parent
                                        or subsidiary thereof, with appropriate
                                        adjustments as to the number and kinds
                                        of shares and exercise prices, in which
                                        event the Option shall continue in the
                                        manner and under the terms so provided.
                                        In the event of any such termination of
                                        the Option, you will have the right, for
                                        30 days immediately prior to the
                                        occurrence of such termination, to
                                        exercise the Option in whole or in part,
                                        whether or not you were otherwise
                                        entitled to exercise such Option at the
                                        time such termination occurs. Any
                                        exercise during such 30-day period shall
                                        be conditioned upon the consummation of
                                        the event and shall be effective only
                                        immediately before the consummation of
                                        the event. The Company shall send you
                                        written notice of an event that will
                                        result in such a termination to you not
                                        later than the time at which the Company
                                        gives notice thereof to its
                                        stockholders.

<PAGE>

RETENTION RIGHTS                        Neither your option nor this Agreement
                                        give you the right to be retained by the
                                        Company in any capacity. The Company
                                        reserves the right to terminate your
                                        Service at any time and for any reason.

SECTION 16                              During any time when the Company has a
                                        class of equity security registered
                                        under Section 12 of the Securities
                                        Exchange Act of 1934, as now in effect
                                        or as hereafter amended, it is the
                                        intent of the Company that this
                                        Agreement will qualify for the exemption
                                        provided by Rule 16b-3 under the
                                        Exchange Act. To the extent that any
                                        provision of this Agreement does not
                                        comply with the requirements of Rule
                                        16b-3, it shall be deemed inoperative to
                                        the extent permitted by law and deemed
                                        advisable by the Board, and shall not
                                        affect the validity of the option
                                        granted hereunder. In the event that
                                        Rule 16b-3 is revised or replaced, the
                                        Board may exercise its discretion to
                                        modify this Agreement in any respect
                                        necessary to satisfy the requirements
                                        of, or to take advantage of any features
                                        of, the revised exemption or its
                                        replacement.

APPLICABLE LAW                          This Agreement will be interpreted and
                                        enforced under the laws of the State of
                                        Maryland, other than any conflicts or
                                        choice of law rule or principle that
                                        might otherwise refer construction or
                                        interpretation of this Agreement to the
                                        substantive law of another jurisdiction.

ADMINISTRATION                          The interpretation and construction by
                                        the Board of any provision of this
                                        Agreement shall be final, binding and
                                        conclusive.

<PAGE>

                                                                       EXHIBIT B

                          GUILFORD PHARMACEUTICALS INC.
                      EXECUTIVE RESTRICTED STOCK AGREEMENT

                  Guilford Pharmaceuticals Inc., a Delaware corporation (the
"Company"), hereby grants shares of its common stock, $.01 par value, (the
"Stock") to the Grantee named below, subject to the vesting conditions set forth
in the attachment.

Grant Date:        -   , 2004
            -------  --

Name of Grantee: Dean J. Mitchell

Grantee's Social Security Number:       -    -
                                   ----- ---- -----

Number of Shares of Stock Covered by Grant:  500,000

         BY SIGNING THIS COVER SHEET, YOU AGREE TO ALL OF THE TERMS AND
CONDITIONS DESCRIBED IN THE ATTACHED AGREEMENT.

Grantee:
                  --------------------------------------------------------------
                                            (Signature)

Company:
                  --------------------------------------------------------------
                                           (Signature)

                  Title:
                          ------------------------------------------------------

Attachment

                  This is not a stock certificate or a negotiable instrument.

<PAGE>

                          GUILFORD PHARMACEUTICALS INC.
                      EXECUTIVE RESTRICTED STOCK AGREEMENT

RESTRICTED STOCK/                       This grant is an award of Stock in the
NONTRANSFERABILITY                      number of shares set forth on the cover
                                        sheet and subject to the vesting
                                        conditions described below ("Restricted
                                        Stock"). To the extent not yet vested,
                                        your Restricted Stock may not be
                                        transferred, assigned, pledged or
                                        hypothecated, whether by operation of
                                        law or otherwise, nor may the Restricted
                                        Stock be made subject to execution,
                                        attachment or similar process.

ISSUANCE AND VESTING                    The Company will issue your Restricted
                                        Stock in your name as of the Grant Date.

                                        This Restricted Stock grant shall become
                                        vested, contingent on your continued
                                        Service, according to the following
                                        schedule:

                                        o    250,000 shares shall become vested
                                             on the one year anniversary of the
                                             Grant Date; provided, that, the
                                             vesting of such shares shall be
                                             accelerated upon the occurrence of
                                             an "Acceleration Event" (as defined
                                             in the employment offer letter
                                             between you and the Company dated
                                             _______ __, 2004 "Offer Letter").

                                        o    250,000 shares shall become vested
                                             on the seven year anniversary of
                                             the Grant Date; provided, that,
                                             vesting of such shares shall be
                                             accelerated based on the attainment
                                             of certain performance criteria to
                                             be mutually agreed upon by you and
                                             the Company in accordance with the
                                             Offer Letter within 90 days of the
                                             Grant Date. Such performance
                                             criteria shall be listed as Exhibit
                                             C of this Agreement. The vesting of
                                             such shares shall also be
                                             accelerated upon: (a) your
                                             termination of Service because of
                                             your death or Disability (as
                                             defined in the Offer Letter) or (b)
                                             a Change of Control (as defined in
                                             the Executive Change of Control and
                                             Severance Agreement between you and
                                             the Company dated ____________ __,
                                             2004).

                                        o    If any of the shares of Restricted
                                             Stock would otherwise become vested
                                             during a period in which you are
                                             (i) subject to a lock-up agreement
                                             restricting your ability to sell
                                             shares of Stock in the open market
                                             or (ii) restricted from selling
                                             shares of Stock in the open market
                                             because you are not then eligible
                                             to sell under the Company's insider
                                             trading or similar plan as

                                       2
<PAGE>

                                             then in effect (whether because a
                                             trading window is not open or you
                                             are otherwise restricted from
                                             trading), vesting in such shares of
                                             Stock will be delayed until the
                                             earlier of (i) the first date on
                                             which you are no longer prohibited
                                             from selling shares of Stock due to
                                             a lock-up agreement or insider
                                             trading plan restriction (the
                                             "Vesting Date") or (ii) the
                                             occurrence of an Acceleration
                                             Event, and provided, further, that
                                             you have been continuously in
                                             Service from the Grant Date until
                                             the Vesting Date.

                                        For the purpose of this Agreement,
                                        "Service" means service as an employee,
                                        officer, director or other service
                                        provider of the Company or an affiliate
                                        of the Company. Your change in position
                                        or duties shall not result in
                                        interrupted or terminated Service, so
                                        long as such you continue to be an
                                        employee, officer, director or other
                                        service provider of the Company or its
                                        affiliate.

FORFEITURE OF UNVESTED STOCK            You shall forfeit any unvested
                                        Restricted Stock upon your termination
                                        of Service for any reason.

ESCROW                                  The certificates for the Restricted
                                        Stock shall be deposited in escrow with
                                        the Secretary of the Company to be held
                                        in accordance with the provisions of
                                        this paragraph. Each deposited
                                        certificate shall be accompanied by a
                                        duly executed Assignment Separate from
                                        Certificate in the form attached hereto
                                        as Exhibit A. The deposited certificates
                                        shall remain in escrow until such time
                                        or times as the certificates are to be
                                        released or otherwise surrendered for
                                        cancellation as discussed below. Upon
                                        delivery of the certificates to the
                                        Company, you shall be issued an
                                        instrument of deposit acknowledging the
                                        number of shares of Stock delivered in
                                        escrow to the Secretary of the Company.

                                        All regular cash dividends on the Stock
                                        (or other securities at the time held in
                                        escrow) shall be paid directly to you
                                        and shall not be held in escrow.
                                        However, in the event of any stock
                                        dividend, stock split, recapitalization
                                        or other change affecting the Company's
                                        outstanding common stock as a class
                                        effected without receipt of
                                        consideration or in the event of a stock
                                        split, a stock dividend or a similar
                                        change in the Company Stock, any new,
                                        substituted or additional securities or
                                        other property which is by reason of
                                        such

                                       3
<PAGE>

                                        transaction distributed with respect to
                                        the Stock shall be immediately delivered
                                        to the Secretary of the Company to be
                                        held in escrow hereunder, but only to
                                        the extent the Stock is at the time
                                        subject to the escrow requirements
                                        hereof.

                                        The shares of Stock held in escrow
                                        hereunder shall be subject to the
                                        following terms and conditions relating
                                        to their release from escrow or their
                                        surrender to the Company for
                                        cancellation:

                                        o    As your interest in the shares
                                             vests as described above, the
                                             certificates for such vested shares
                                             shall be released from escrow and
                                             delivered to you, at your request.

                                        Notwithstanding the foregoing, in lieu
                                        of the issuance of certificates under
                                        this Agreement and the use of an escrow
                                        arrangement, the Company may instead use
                                        the book-entry method of recording share
                                        issuance.

WITHHOLDING TAXES                       You agree, as a condition of this grant,
                                        that you will make acceptable
                                        arrangements to pay any withholding or
                                        other taxes that may be due as a result
                                        of the vesting of Stock acquired under
                                        this grant. In the event that the
                                        Company determines that any federal,
                                        state, local or foreign tax or
                                        withholding payment is required relating
                                        to the vesting of shares arising from
                                        this grant, the Company will have the
                                        right to: (i) require that you arrange
                                        such payments to the Company, or (ii)
                                        withhold such amounts from other
                                        payments due to you from the Company. In
                                        the alternative and only if the Company
                                        grants its approval, you may elect to
                                        satisfy the minimum required withholding
                                        requirements by forfeiting to the
                                        Company shares of Stock acquired
                                        pursuant to this Agreement in an amount
                                        equal to the withholding or other taxes
                                        due.

SECTION 83(b)                           Under Section 83 of the Internal Revenue
ELECTION                                Code of 1986, as amended (the "Code"),
                                        the difference between the purchase
                                        price paid (if any) for the shares of
                                        Stock and their fair market value on the
                                        date any forfeiture restrictions
                                        applicable to such shares lapse will be
                                        reportable as ordinary income at that
                                        time. For this purpose, "forfeiture
                                        restrictions" include the Company's
                                        right to cancel unvested Restricted
                                        Stock described above. You may elect to
                                        be taxed at the time the shares are
                                        acquired rather than when such shares
                                        cease to be subject to such forfeiture
                                        restrictions by filing an election under
                                        Section 83(b) of the Code

                                       4
<PAGE>

                                        with the Internal Revenue Service within
                                        thirty (30) days after the Grant Date.
                                        You will have to make a tax payment to
                                        the extent the purchase price is less
                                        than the fair market value of the shares
                                        on the Grant Date. No tax payment will
                                        have to be made to the extent the
                                        purchase price is at least equal to the
                                        fair market value of the shares on the
                                        Grant Date. The form for making this
                                        election is attached as Exhibit B
                                        hereto. Failure to make this filing
                                        within the thirty (30) day period will
                                        result in the recognition of ordinary
                                        income by you (in the event the fair
                                        market value of the shares increases
                                        after the date of purchase) as the
                                        forfeiture restrictions lapse.

                                        YOU ACKNOWLEDGE THAT IT IS YOUR SOLE
                                        RESPONSIBILITY, AND NOT THE COMPANY'S,
                                        TO FILE A TIMELY ELECTION UNDER SECTION
                                        83(b), EVEN IF YOU REQUEST THE COMPANY
                                        OR ITS REPRESENTATIVES TO MAKE THIS
                                        FILING ON YOUR BEHALF. YOU ARE RELYING
                                        SOLELY ON YOUR OWN ADVISORS WITH RESPECT
                                        TO THE DECISION AS TO WHETHER OR NOT TO
                                        FILE ANY 83(b) ELECTION.

SHAREHOLDER RIGHTS                      You have the right to vote the
                                        Restricted Stock and to receive any
                                        dividends declared or paid on such
                                        stock. Any distributions you receive as
                                        a result of any stock split, stock
                                        dividend, combination of shares or other
                                        similar transaction shall be deemed to
                                        be a part of the Restricted Stock and
                                        subject to the same conditions and
                                        restrictions applicable thereto. No
                                        adjustments are made for dividends or
                                        other rights if the applicable record
                                        date occurs before your stock
                                        certificate is issued.

ADJUSTMENTS                             In the event of a stock split, a stock
                                        dividend or a similar change in the
                                        Company stock, the number of shares
                                        covered by this grant shall be adjusted
                                        (and rounded down to the nearest whole
                                        number). Your Restricted Stock shall be
                                        subject to the terms of the agreement of
                                        merger, liquidation or reorganization in
                                        the event the Company is subject to such
                                        corporate activity in the same manner as
                                        the common stock of the Company, but
                                        shall be subject to the vesting
                                        provisions hereof.

                                        Upon the occurrence of a Change of
                                        Control (as defined in the Executive
                                        Change of Control and Severance

                                       5
<PAGE>
                                        Agreement between you and the Company
                                        dated ____________ __, 2004) the Board
                                        may elect, in its sole discretion, to
                                        cancel the Restricted Stock and pay or
                                        deliver, or cause to be paid or
                                        delivered, to you an amount in cash or
                                        securities having a value (as determined
                                        by the Board acting in good faith) equal
                                        to the formula or fixed price per share
                                        paid to holders of shares of Stock.

LEGENDS                                 All certificates representing the Stock
                                        issued in connection with this grant
                                        shall, where applicable, have endorsed
                                        thereon the following legends:

                                            "THE SHARES REPRESENTED BY THIS
                                            CERTIFICATE ARE SUBJECT TO CERTAIN
                                            RESTRICTIONS ON TRANSFER AND OPTIONS
                                            TO PURCHASE SUCH SHARES SET FORTH IN
                                            AN AGREEMENT BETWEEN THE COMPANY AND
                                            THE REGISTERED HOLDER, OR HIS OR HER
                                            PREDECESSOR IN INTEREST. A COPY OF
                                            SUCH AGREEMENT IS ON FILE AT THE
                                            PRINCIPAL OFFICE OF THE COMPANY AND
                                            WILL BE FURNISHED UPON WRITTEN
                                            REQUEST TO THE SECRETARY OF THE
                                            COMPANY BY THE HOLDER OF RECORD OF
                                            THE SHARES REPRESENTED BY THIS
                                            CERTIFICATE."

APPLICABLE LAW                          This Agreement will be interpreted and
                                        enforced under the laws of the State of
                                        Maryland, other than any conflicts or
                                        choice of law rule or principle that
                                        might otherwise refer construction or
                                        interpretation of this Agreement to the
                                        substantive law of another jurisdiction.

SECTION 16                              During any time when the Company has a
                                        class of equity security registered
                                        under Section 12 of the Securities
                                        Exchange Act of 1934, as now in effect
                                        or as hereafter amended, it is the
                                        intent of the Company that this
                                        Agreement will qualify for the exemption
                                        provided by Rule 16b-3 under the
                                        Exchange Act. To the extent that any
                                        provision of this Agreement does not
                                        comply with the requirements of Rule
                                        16b-3, it shall be deemed inoperative to
                                        the extent permitted by law and deemed
                                        advisable by the Board, and shall not
                                        affect the validity

                                       6
<PAGE>

                                        of the option granted hereunder. In the
                                        event that Rule 16b-3 is revised or
                                        replaced, the Board may exercise its
                                        discretion to modify this Agreement in
                                        any respect necessary to satisfy the
                                        requirements of, or to take advantage of
                                        any features of, the revised exemption
                                        or its replacement.

ADMINISTRATION                          The interpretation and construction by
                                        the Board of Directors of the Company of
                                        any provision of this Agreement shall be
                                        final, binding and conclusive.

                                       7
<PAGE>

                      ASSIGNMENT SEPARATE FROM CERTIFICATE

     FOR VALUE RECEIVED, _____________hereby sells, assigns and transfers unto
Guilford Pharmaceuticals Inc., a Delaware corporation (the "Company"),
____________(__________) shares of common stock of the Company represented by
Certificate No. ___ herewith and does hereby irrevocable constitute and appoint
______________ Attorney to transfer the said stock on the books of the Company
with full power of substitution in the premises.

     Dated:            , 2004
           ------------

                                      ------------------------------------------
                                                      Print Name

                                      ------------------------------------------
                                                       Signature

                         Spouse Consent (if applicable)

     ___________________ (Purchaser's spouse) indicates by the execution of this
Assignment his or her consent to be bound by the terms herein as to his or her
interests, whether as community property or otherwise, if any, in the shares of
common stock of the Company.

                                      ------------------------------------------
                                                        Signature

INSTRUCTIONS: PLEASE DO NOT FILL IN ANY BLANKS OTHER THAN THE SIGNATURE LINE.
THE PURPOSE OF THIS ASSIGNMENT IS TO ENABLE THE COMPANY TO CANCEL UNVESTED
SHARES AS SET FORTH IN THE AGREEMENT WITHOUT REQUIRING ADDITIONAL SIGNATURES ON
THE PART OF PURCHASER.

<PAGE>

                                    EXHIBIT B

                         ELECTION UNDER SECTION 83(b) OF
                            THE INTERNAL REVENUE CODE

                  The undersigned hereby makes an election pursuant to Section
83(b) of the Internal Revenue Code with respect to the property described below
and supplies the following information in accordance with the regulations
promulgated thereunder:

                  1. The name, address and social security number of the
undersigned:

                  Name:
                       ---------------------------------------------------------
                  Address:
                          ------------------------------------------------------

                  Social Security No. :
                                       -----------------------------------------

                  2. Description of property with respect to which the election
is being made:

                  __________________ shares of common stock, par value $.01 per
                  share, Guilford Pharmaceuticals Inc., a Delaware corporation,
                  (the "Company").

                  3. The date on which the property was transferred is
____________ __, 2004.

                  4. The taxable year to which this election relates is calendar
year 2004.

                  5. Nature of restrictions to which the property is subject:

                  The shares of stock are subject to the provisions of a
         Restricted Stock Agreement between the undersigned and the Company. The
         shares of stock are subject to forfeiture under the terms of the
         Agreement.

                  6. The fair market value of the property at the time of
transfer (determined without regard to any lapse restriction) was $__________
per share, for a total of $__________.

                  7. The amount paid by taxpayer for the property was
$__________.

                  8. A copy of this statement has been furnished to the Company.

                                       8
<PAGE>

Dated:               , 2004
        -------------

                                             -----------------------------------
                                                     Taxpayer's Signature

                                             -----------------------------------
                                                     Taxpayer's Printed Name

<PAGE>

                        PROCEDURES FOR MAKING ELECTION
                    UNDER INTERNAL REVENUE CODE SECTION 83(b)

                  The following procedures MUST be followed with respect to the
attached form for making an election under Internal Revenue Code section 83(b)
in order for the election to be effective:

                  1. You must file one copy of the completed election form with
the IRS Service Center where you file your federal income tax returns within 30
days after the Grant Date of your Restricted Stock.

                  2. At the same time you file the election form with the IRS,
you must also give a copy of the election form to the Secretary of the Company.

                  3. YOU MUST FILE ANOTHER COPY OF THE ELECTION FORM WITH YOUR
FEDERAL INCOME TAX RETURN (GENERALLY, FORM 1040) FOR THE TAXABLE YEAR IN WHICH
THE STOCK IS TRANSFERRED TO YOU.

<PAGE>

                                    EXHIBIT C

                [TO BE PROVIDED WITHIN 90 DAYS OF THE GRANT DATE]

<PAGE>

                                                                       EXHIBIT C

                          GUILFORD PHARMACEUTICALS INC.
                    EXECUTIVE RESTRICTED STOCK UNIT AGREEMENT

                  Guilford Pharmaceuticals Inc., a Delaware corporation (the
"Company"), hereby grants units relating to its common stock, $.01 par value,
(the "Stock") to the Grantee named below, subject to the vesting conditions set
forth in the attachment.

Grant Date:        -   , 2004
            -------  --

Name of Grantee: Dean J. Mitchell

Grantee's Social Security Number:       -    -
                                   ----- ---- -----

Number of Restricted Stock Units Covered by Grant: A number of units
representing a number of shares of Stock equal to:

         the quotient of $1 million divided by the average closing price of the
         Stock for each trading day in the 20 trading day period preceding the
         Payout Date (as defined in the attached Agreement), but in no event
         more than 100,000 shares of Stock (subject to adjustment for stock
         splits and similar corporate events as provided in the attached
         agreement).

         BY SIGNING THIS COVER SHEET, YOU AGREE TO ALL OF THE TERMS AND
CONDITIONS DESCRIBED IN THE ATTACHED AGREEMENT.

Grantee:
                  --------------------------------------------------------------
                                          (Signature)

Company:
                  --------------------------------------------------------------
                                          (Signature)

                  Title:
                          ------------------------------------------------------

Attachment

                  This is not a stock certificate or a negotiable instrument.

<PAGE>

                          GUILFORD PHARMACEUTICALS INC.
                    EXECUTIVE RESTRICTED STOCK UNIT AGREEMENT

NONTRANSFERABILITY                      This grant is an award of Restricted
                                        Stock Units in the number set forth on
                                        the cover sheet and subject to the
                                        vesting conditions described below
                                        ("Restricted Stock Units"). Your
                                        Restricted Stock Units may not be
                                        transferred, assigned, pledged or
                                        hypothecated, whether by operation of
                                        law or otherwise, nor may the Restricted
                                        Stock Units be made subject to
                                        execution, attachment or similar
                                        process.

ISSUANCE AND VESTING                    This Restricted Stock Unit grant shall
                                        become vested, contingent on your
                                        continued Service (as defined below),
                                        according to the following schedule:

                                        o    100% of the shares subject to this
                                             Agreement shall become vested upon
                                             the first to occur of: (a) February
                                             12, 2011; or (b) a Change of
                                             Control (as defined in the
                                             Executive Change of Control and
                                             Severance Agreement between you and
                                             the Company dated ____________ __,
                                             2004). It is intended that Change
                                             of Control have a meaning
                                             consistent with Section 409A of the
                                             Internal Revenue Code and the
                                             regulations thereunder.

                                        For the purpose of this Agreement,
                                        "Service" means service as an employee,
                                        officer, director or other service
                                        provider of the Company or an affiliate
                                        of the Company. Your change in position
                                        or duties shall not result in
                                        interrupted or terminated Service, so
                                        long as such you continue to be an
                                        employee, officer, director or other
                                        service provider of the Company or its
                                        affiliate.

DELIVERY OF SHARES                      A certificate for the shares of Stock
PURSUANT TO                             represented by the Restricted Stock
RESTRICTED STOCK UNITS                  Units shall be delivered to you, or to
                                        your eligible beneficiary or your
                                        estate, at such time as the Restricted
                                        Stock Units become vested; provided,
                                        that, if required by Section 409A of the
                                        Internal Revenue Code and the
                                        regulations thereunder, delivery of the
                                        shares shall not be made earlier than
                                        six months after your separation from
                                        service within the meaning

<PAGE>

                                        of Section 409A. The date that
                                        certificates are required to be
                                        delivered to you under this subsection
                                        is the "PAYOUT DATE."

                                        If the Payout Date provided for in the
                                        preceding paragraph would otherwise
                                        occur during a period in which you are:
                                        (a) subject to a lock-up agreement
                                        restricting your ability to sell shares
                                        of Stock in the open market or (b)
                                        restricted from selling shares of Stock
                                        in the open market because you are not
                                        then eligible to sell under the
                                        Company's insider trading or similar
                                        plan as then in effect (whether because
                                        a trading window is not open or you are
                                        otherwise restricted from trading), the
                                        Payout Date will be delayed until the
                                        first date on which you are no longer
                                        prohibited from selling shares of Stock
                                        due to a lock-up agreement or insider
                                        trading plan restriction.

FORFEITURE OF UNVESTED                  You shall forfeit any unvested
RESTRICTED STOCK UNITS                  Restricted Stock Units upon your
                                        termination of Service for any reason.

WITHHOLDING TAXES                       You agree, as a condition of this grant,
                                        that you will make acceptable
                                        arrangements to pay any withholding or
                                        other taxes that may be due as a result
                                        of the vesting of Stock acquired under
                                        this grant. In the event that the
                                        Company determines that any federal,
                                        state, local or foreign tax or
                                        withholding payment is required relating
                                        to the vesting of shares arising from
                                        this grant, the Company shall have the
                                        right to: (i) require that you arrange
                                        for such payments to the Company, or
                                        (ii) withhold such amounts from other
                                        payments due to you from the Company. In
                                        the alternative and only if the Company
                                        grants its approval, you may elect to
                                        satisfy the minimum required withholding
                                        requirements by forfeiting to the
                                        Company shares of Stock acquired
                                        pursuant to this Agreement in an amount
                                        equal to the withholding or other taxes
                                        due.

SHAREHOLDER RIGHTS                      You do not have any of the rights of a
                                        shareholder with respect to the
                                        Restricted Stock Units unless and until
                                        the Shares relating to the Restricted
                                        Stock Units has been delivered to you.

<PAGE>
ADJUSTMENTS                             In the event of a stock split, a stock
                                        dividend or a similar change in the
                                        Company stock, the maximum number of
                                        Restricted Stock Units covered by this
                                        grant shall be adjusted (and rounded
                                        down to the nearest whole number). Your
                                        Restricted Stock Units shall be subject
                                        to the terms of the agreement of merger,
                                        liquidation or reorganization in the
                                        event the Company is subject to such
                                        corporate activity in the same manner as
                                        common stock of the Company, but shall
                                        be subject to the vesting and
                                        distribution provisions hereof.

APPLICABLE LAW                          This Agreement will be interpreted and
                                        enforced under the laws of the State of
                                        Delaware, other than any conflicts or
                                        choice of law rule or principle that
                                        might otherwise refer construction or
                                        interpretation of this Agreement to the
                                        substantive law of another jurisdiction.

ADMINISTRATION                          The interpretation and construction by
                                        the Board of Directors of the Company of
                                        any provision of this Agreement shall be
                                        final, binding and conclusive.

<PAGE>

       THIS IS A RELEASE. YOU SHOULD READ IT CAREFULLY BEFORE YOU SIGN IT.

                    SEPARATION AGREEMENT AND GENERAL RELEASE

         THIS SEPARATION AGREEMENT AND GENERAL RELEASE ("Agreement") is made and
entered into on the date this Agreement is fully executed (the "Agreement Date")
by and between GUILFORD PHARMACEUTICALS INC. (the "Company") and xxxxx
("Employee").

         WHEREAS, the parties desire to set forth in this Agreement the terms
upon which they have mutually agreed to an orderly termination of Employee's
employment with the Company;

         NOW THEREFORE, in consideration of the foregoing and of other
considerations contained in this Agreement, the parties agree as follows:

1.       Separation of Employment. Employee acknowledges that Employee's
         employment with the Company will cease upon the close of business on
         xxx, 2004 ("Effective Date") and agrees that Employee has no right to
         further employment by the Company after that date. Further, Employee
         acknowledges that Employee's last day of work is xxx, 2004

2.       Severance and Other "Benefits". In consideration of the covenants and
         agreements made by Employee hereunder, the Company will, commencing
         upon the eighth day after this Agreement has been executed by Employee
         (provided that such execution has not been revoked by employee prior
         thereto):

         (a)      Subject to the provisions of Section 3 below, pay Employee a
                  total severance of $xx,xxxx.xx, which will be paid following
                  Company's regular payroll process, in increments to resemble
                  regular pay checks, less applicable taxes and withholdings;

         (b)      Employee will continue on medical Benefits as an employee
                  through xxx xx, xxxx and may enroll in COBRA benefits after
                  xxx xx, xxxx. Information concerning COBRA rights and costs
                  will be provided under separate cover, following usual Company
                  process;

         (c)      Employee will be eligible to participate in outplacement
                  support through Right Management Consultants' CEO program,
                  provided Employee initiates participation in the outplacement
                  program within 60 days of the Effect Date;

<PAGE>

Employees Name
Date, 2004

3.       Other Benefits. Except as provided in Section 2 of this Agreement or
         any grant, plan or program, the Company shall not be obligated to make
         any other payments, or provide any other benefits to Employee,
         following the Effective Date. Without limiting the generality of the
         foregoing, all vesting of stock options, eligibility for matching
         grants and all other benefits shall terminate on the Effective Date,
         except as otherwise provided in your employment agreement or any grant.

4.       Release. In consideration of the Benefit described in Section 2,
         Employee, on behalf of Employee, Employee's heirs, executors,
         administrators, successors and assigns, hereby releases, acquits and
         forever discharges the Company and any and all of its current or former
         subsidiaries and other affiliated entities and benefit plans, as well
         as its and/or their officers, directors, representatives, attorneys,
         agents, servants, employees, stockholders, successors, predecessors and
         affiliates in such capacities (for purposes of this Section 5, all
         incorporated in the definition of the "Company") from any and all
         claims, liabilities, demands, causes of action, costs, expenses,
         attorney's fees, damages, indemnities and obligations of every kind and
         nature, in law, in equity or otherwise, known or unknown, suspected or
         unsuspected, disclosed and undisclosed, arising out of or in any way
         related to agreements, acts or conduct at any time as of or prior to
         the Effective Date, including, but not limited to: all such claims or
         demands arising from Employee's employment or the termination of
         Employee's employment; all such claims and demands related to salary,
         bonuses, commissions, stock, stock options, (except that Employee shall
         have the right to exercise any vested and unexercised stock options
         previously granted to Employee in accordance with any agreement(s)
         applicable thereto), and stock option plan(s), fringe benefits,
         severance pay, expense reimbursements, or any form of compensation;
         claims pursuant to any federal, state or local law or cause of action
         including, but not limited to, the Federal Civil Rights Acts of 1964,
         as amended, The Americans with Disabilities Act, the Maryland Fair
         Employment Practices Act, as amended, the Age Discrimination in
         Employment Act of 1967, as amended, the Employee Retirement Income
         Security Act of 1974, as amended, or any law or legal principle of
         similar effect in any other relevant jurisdiction; contract claims;
         tort claims; or claims of wrongful discharge, discrimination, fraud,
         defamation, and emotional distress. Employee further agrees not to sue
         or otherwise institute or cause to be instituted or in any way
         voluntarily participate in the prosecution of any complaints or charges
         against any persons or entities released herein in any federal, state
         or other court, administrative agency or other forum concerning

<PAGE>

Employees Name
Date, 2004

         any claims released herein. The foregoing release shall not cover the
         Employee's rights to indemnification or coverage under directors and
         officers liability insurance policies.

5.       Return of Company Property. Employee will immediately return any of the
         Company's property in Employee's possession or control (including, but
         not limited to, any Company keys, identification cards, credit cards,
         business cards, documents, records, and computer hardware, software or
         tapes or diskettes) to a designated representative of the Company. The
         foregoing shall not cover the Employee's rolodex and similar address
         book, which he may retain and use.

6.       Certain Covenants. Employee covenants and agrees that for a two (2)
         year period following the Agreement Date hereof, Employee will refrain
         from making with intent to damage the Company any public defamatory,
         derogatory or other unfavorable statements regarding the Company or its
         business, officers, directors, employees and agents; provided the
         foregoing shall not prevent compliance with legal process. The Company
         covenants and agrees that for a two (2) year period following the
         Agreement date hereof, the Company formally and its officers and
         directors, directly and indirectly, will refrain from making with
         intent to damage the Employee any public defamatory, derogatory or
         other unfavorable statements regarding the Employee, provided the
         foregoing shall not prevent compliance with legal process.

7.       Confidentiality. Except for Employee's own attorney, tax advisor and
         immediate family, and potential future employers with regard to
         relevant provisions, Employee agrees that the terms of this Agreement
         shall be confidential, and that Employee, Employee's attorney, tax
         advisor and immediate family will not disclose any information
         concerning the terms of this Agreement to anyone, including but not
         limited to past, present or future employees of the Company. Employee
         acknowledges that Employee remains bound by the provisions of a Patent
         and Confidentiality Agreement as previously signed by Employee. This
         provision shall cease to apply to the extent this Agreement is publicly
         available.

8.       Severability. Each provision of this Agreement shall be considered
         severable. If any provision contained herein is held to be void,
         illegal or unenforceable, such illegality or unenforceability shall not
         affect any of the other provisions herein, and the remaining provisions
         of this Agreement will continue to be given full force and effect. It
         is the intention of the Parties that, if any court construes any
         provision to be unenforceable or unreasonable because of the duration
         of such provision or the area or matter, if capable of being made
         enforceable by the court's reduction of such provision, this Agreement
         shall be reduced and enforceable in its modified form.

9.       No Admission. Employee understands and agrees that nothing contained in
         this Agreement is to be considered an admission by the Company of any
         wrongdoing under any federal, state or local statute, regulation,
         public policy, tort law, contract law, or common law.

<PAGE>

Employees Name
Date, 2004

10.      Acknowledgment. Employee acknowledges that Employee has read and
         understands this Agreement and is executing it knowingly, voluntarily
         and without coercion, that Employee has been advised to consult with an
         attorney prior to executing this Agreement, and that Employee has been
         given a period of twenty-one (21) days within which to consider and
         execute this Agreement, unless Employee voluntarily chooses to execute
         this Agreement before the end of the 21-day period. Once executed,
         Employee understands that Employee has seven (7) days following the
         execution of this Agreement to revoke it, and that this Agreement is
         not effective or enforceable until after this seven (7) day period.
         Among other things, this means that the Benefits contemplated in
         Section 2 above will not be payable until this Agreement becomes
         effective and enforceable. Employee understands that a portion of the
         consideration offered by the Company in this Agreement relates
         specifically to Employee's release of claims under the Age
         Discrimination in Employment Act of 1967, as amended. Employee further
         understands that once this Agreement becomes effective, it cannot be
         altered, revoked or rescinded without the express written consent of
         the Company.

11.      In Event of Breach or Dispute. Any dispute or controversy arising under
         or in connection with this Agreement, other than with regard to
         injunctive relief, shall be settled exclusively by arbitration
         administered by the American Arbitration Association and conducted
         before one arbitrator in Baltimore, Maryland, all in accordance with
         its Commercial Arbitration Rules then in effect. The decision of the
         arbitrators shall be final and binding and may be entered in any court
         of competent jurisdiction. In the event of any dispute in connection
         with this Agreement, if the arbitrator determines that you have
         prevailed in such dispute, you shall be awarded your reasonable legal
         fees, disbursements and costs.

12.      Modifications. This Agreement may not be modified in any way except in
         a written agreement signed by both Employee and an officer or other
         authorized representative of the Company.

13.      Governing Law. This Agreement shall be governed by, and construed in
         accordance with, the laws of the State of Maryland without giving
         effect to its conflict of law provisions. Subject to Section 12 above,
         the parties agree to submit to the exclusive jurisdiction of the state
         and federal courts situated in Baltimore, Maryland for all disputes
         arising under or relating to this Agreement.

14.      Entire Agreement. This Agreement constitutes the entire agreement and
         understanding between the Company and Employee relating to Employee's
         separation from the Company. Employee acknowledges and agrees that in
         executing this Agreement, Employee has not relied on any promises or
         representations other than those set forth in the Agreement.

<PAGE>

Employees Name
Date, 2004

15.      Expiration of Offer. The offer to Employee created by this Agreement
         shall expire and automatically become null and void and of no effect if
         Employee has not executed and delivered this Agreement by 5:00 p.m.
         E.D.T., xxxxx, 2004.

GUILFORD PHARMACEUTICALS INC.              xxxxxx (EMPLOYEE):

By
  -----------------------------------      -------------------------------------
                                           Signature

  --------------------                     --------------------
  Date                                     Date

<PAGE>

                        (GUILFORD PHARMACEUTICALS LOGO)

                      PATENT AND CONFIDENTIALITY AGREEMENT

         In consideration of my employment by Guilford Pharmaceuticals Inc.
and/or its affiliates ("Guilford"), and its successors or assigns and the
compensation paid and to be paid to me by Guilford, I hereby covenant, represent
and agree that:

         1. EXCLUSIVE PROPERTY OF GUILFORD. My entire interest in any and all
inventions and improvements conceived or completed by me, either alone or with
others after ____________________, 20__ ("Employment Date") until the
termination of my employment with Guilford, shall be the exclusive property of
Guilford.

         2. DISCLOSURE OF INVENTIONS AND IMPROVEMENTS. All such inventions and
improvements (whether patentable or not) will be disclosed by me promptly in
writing to Guilford without any obligation of Guilford to pay royalty or other
consideration other than my regular wages. I agree that my regular wages are
full and complete compensation for: (a) all obligations assumed by me under this
Agreement; and (b) all inventions, improvements, discoveries and patent rights
assigned by me under this Agreement; and (c) in full satisfaction of any
compensation and royalties to which I may be entitled by law or otherwise,
including but not limited to, the law of any country in which I am a resident at
any time during the term of this Agreement. In addition to the foregoing, I
shall disclose promptly to Guilford all suggestions, ideas, information,
observations and data obtained or conceived by me in the course of my employment
with Guilford. I agree that I shall at no time subsequent to the Employment Date
assert any rights under any invention as having been made or acquired by me
prior to my employment by Guilford except as set forth in the attached Exhibit
A, which contains a detailed description or copies of such inventions. If there
are no exceptions listed, it is understood that there are none.

         3. ASSIGNMENT OF INTERESTS. At the request and expense of Guilford, but
without further compensation to me, I will do all lawful acts and execute all
lawful papers, which Guilford may deem necessary from time to time to perfect
and protect the exclusive rights of Guilford in such inventions and
improvements. I shall promptly and fully assist, as requested by Guilford, in
the preparation and filing of patent applications in all countries selected by
Guilford for such inventions as belong to Guilford and shall ssign my entire
right, title, and interest in and to such inventions and patent applications to
Guilford for all countries and promptly sign any and all lawful papers, take all
lawful oaths and do all lawful acts, including giving testimony as requested by
Guilford without cost to me and at the expense of Guilford in connection with
any patent application or patent.

         4. RELEASE OF CERTAIN RIGHTS. As to inventions and improvements set
forth in numbered Paragraph 1, but which are not, in my opinion, of interest to
Guilford, I nevertheless agree promptly to disclose them as provided for in
Paragraph 2, in return for which I shall have the right, by written

<PAGE>

request stating why each such invention or improvement is not of interest to
Guilford, to request Guilford to release its right therein.

         5. RECORDKEEPING. I shall keep and maintain adequate and current
written records, in accordance with Guilford policies and practices, of all
inventions and confidential information in the form of notes, sketches,
drawings, reports, or other documents relating thereto, which shall be and shall
remain the exclusive property of Guilford and shall be available to Guilford at
all times. All writings, records, and other documents and things containing any
inventions or confidential information of Guilford in my custody or possession
shall be the exclusive property of Guilford shall not be copied and/or removed
from the premises of Guilford except in pursuit of the business of Guilford, and
shall be delivered to Guilford without retaining any copies, upon the
termination of employment or at any time as requested by Guilford.

         6. CONFIDENTIAL INFORMATION. In the course of my employment by
Guilford, I will acquire knowledge and information pertaining to Guilford which
is confidential or in which Guilford has proprietary rights, whether or not
specifically designated by Guilford as confidential. I agree not to disclose or
use (except as I in good faith deem reasonably necessary or desirable in the job
or pursuant to legal process) any confidential information including trade
secrets, know how and other proprietary information of Guilford or any
information received in confidence by Guilford from others, either during or
after my employment. It is understood that such confidential information of
Guilford includes matters conceived or developed by me, as well as matters
learned from other employees of Guilford. I shall not, except as an authorized
representative of Guilford may otherwise consent or direct, in writing, reveal
or disclose, sell, use, lecture upon, or publish any confidential information of
Guilford, or authorize anyone else to do these things at any time either during
or subsequent to my employment with Guilford, except as permitted in the prior
sentence. This clause shall continue in full force and effect after termination
of my employment except that the obligations with respect to any specific
portion of confidential information shall cease whenever such specific portion
of confidential information has become generally known to the public.

         7. CONFLICTS OF INTEREST. During the period of my employment, I agree
not to engage directly or indirectly in any activities that would represent a
conflict of interest or compete with the research or business activities of
Guilford, provided the foregoing shall not prevent me from owning more than two
percent (2%) of any publicly owned company or having ownership through mutual
funds, private equity or other similar investment groups so long as I am not
actively involved in the investment or management decisions. Further, I agree to
adhere to all the rules, regulations, and policies of Guilford that have been
established or may hereafter be established with respect to the subject matter
of this Agreement that has been disclosed in writing to me.

         8. AT-WILL EMPLOYMENT. This Agreement is not an agreement of employment
and does not create a contract of employment. I understand that my employment at
Guilford is "at will" and not for a specified term and that such employment can
be terminated at any time by either party, with or without cause and with or
without notice. Following termination of employment, I shall continue to be
obligated under the non-disclosure of confidential information provisions of
this agreement not to use or disclose confidential information so long as it
remains proprietary or protectible as confidential or a trade secret. The
obligations under Paragraphs 1 through 6 inclusive of this Agreement shall not
terminate upon the termination of my employment, but rather, shall continue in
effect thereafter until

<PAGE>

such time as the rights to the improvements, discoveries and inventions have
been protected in Guilford and the information referred to in Paragraph 6 hereof
shall be in the public domain through no act of mine. I will not take with me or
retain, unless authorized in writing by the Chief Executive Officer of Guilford
any text, drawings, blueprints, specifications, data or any writings or
documents whatsoever, or copies thereof, which reflect or deal with confidential
or proprietary knowledge or information of Guilford or its business, and I will
deliver to Guilford all of the foregoing which may be in my possession prior to
leaving the employ of Guilford. Prior to departure, I will cooperate with
Guilford in completing the employee exit procedures and, to the extent
acceptable to me, signing any documents then in use by Guilford.

         9. EQUITABLE RELIEF. I agree that the confidential and proprietary
information of Guilford which may be acquired by me are unique and that any
breach of this Agreement by me cannot be compensated adequately by monetary
damages. I therefore agree, that Guilford shall be entitled, in addition to all
other remedies available to it, to equitable relief by injunction or otherwise
as to any breach of this Agreement.

         10. ENTIRE AGREEMENT. Guilford and I agree that this Agreement
supersedes any prior agreement relating generally to the subject matter hereof,
and I agree that this Agreement can only be amended, altered or terminated and
its provisions can only be waived by an agreement in writing signed by me and by
the Chief Legal Officer of Guilford or his designee.

         11. NO EXCLUSIONS. No inventions or improvements or confidential
information otherwise included in this Agreement are excluded from its terms
unless set out in writing and attached hereto as Exhibit A.

         12. NO CONFLICTS. I represent that I have no agreements with or
obligations to others in conflict with the foregoing.

         13. MATERIALS OF PRIOR EMPLOYERS. I represent that I have not brought
and will not bring to Guilford in the course of my employment by Guilford any
materials or documents of a former employer that are not generally available to
the public, unless I have obtained prior express written authorization from the
former employer for their possession and use. I have specified in writing and
attached hereto as Exhibit A all such authorized materials or documents.

         14. PHOTOGRAPHS. I consent to my photograph being taken by Guilford and
its representatives from time to time and agree that Guilford may use any such
photograph at any time including after termination of my employment by Guilford
so long as it is used only with regard to positive purposes and shows me in a
favorable light without any obligation on the part of Guilford to pay me any
consideration other than the regular wages due me for so long as I am employed
at Guilford.

         15. NON-SOLICITATION. For a period commencing on the Employment Date
and continuing for one year following the date that my employment with Guilford
terminates, I will not, directly or indirectly, solicit for employment any
employee of Guilford for employment with any person, business or entity other
than Guilford, nor, except in the good faith performance of my duties, will I
encourage or incite any employee of Guilford to terminate his or her employment
with Guilford. I may, however,

<PAGE>

serve as a reference for an employee so long as I am not being compensated by
the company the reference is given to. The foregoing shall not limit general
advertising or other general forms of soliciting not specifically targeted at
Guilford employees.

                               [signature follows]

<PAGE>

Executed at Baltimore, Maryland this ____ day of ____________________, 20__.

                                            ------------------------------------
                                            Signature

                                            ------------------------------------
                                            Printed Name

------------------------------------
Witness

<PAGE>

                        (GUILFORD PHARMACEUTICALS LOGO)

                      PATENT AND CONFIDENTIALITY AGREEMENT

                                    EXHIBIT A

         1. The following is a complete list of all inventions, developments,
improvements and discoveries which have been made, conceived of or reduced to
practice by the undersigned, alone or jointly with others, prior to employment
by Guilford:

                                                               none
                                                  -----
                                                               see below
                                                  -----

------------------------------------              ------------------------------
Signature                                         Date

------------------------------------
Printed Name

         2. The following is a complete list of all materials or documents of a
former employer brought to Guilford by the undersigned:

                                                               none
                                                  -----
                                                               see below
                                                  -----

------------------------------------              ------------------------------
Signature                                         Date

------------------------------------
Printed Name<PAGE>
                                                                    EXHIBIT 10.2

                 EXECUTIVE CHANGE IN CONTROL SEVERANCE AGREEMENT

         This EXECUTIVE CHANGE IN CONTROL SEVERANCE AGREEMENT (this "Agreement")
is dated and effective as of ___________________, 2004, between GUILFORD
PHARMACEUTICALS INC., (the "Employer"), and DEAN J. MITCHELL (the "Executive").

                  WHEREAS, the Executive has been engaged to serve as President
and Chief Executive Officer of the Employer by an Offer Letter dated November
16, 2004( the "Offer Letter"), and in that role is expected to be important in
developing and expanding the business and operations of the Employer and
possesses valuable knowledge and skills with respect to such business; and

                  WHEREAS, the Board of Directors of the Employer (the "Board")
believes that it is in the best interests of the Employer to encourage the
Executive's continued employment with and dedication to the Employer, including
in the face of potentially distracting circumstances arising from the
possibility of a change in control of the Employer; and

                  WHEREAS, the Board has adopted a policy which authorizes the
Employer to enter into this Agreement with the Executive; and

                  WHEREAS, the parties desire to enter into this Agreement
setting forth the terms and conditions for the payment of compensation to the
Executive in the event of a termination of the Executive's employment during the
term of this Agreement due to a Change in Control;

                  NOW, THEREFORE, in consideration of the foregoing, the mutual
covenants and agreements of the parties contained herein and other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties
hereto agree as follows:

1.       DEFINITIONS.

         The following capitalized terms are defined in the sections of this
Agreement listed beside such terms:

<Table>
<Caption>
                 TERM              SECTION               TERM                  SECTION
-------------------------          --------      --------------------------    -------

<S>                                <C>           <C>                           <C>
Agreement                          Preamble      Current Annual Base Salary      6
Annual Base Salary                    6          Date of Termination             4.1
Accounting Firm                      5.2         Exchange Act                    9
Board                              Preamble      Excise Tax                      5.1
Cause                                 7          Good Reason                     8
Change in Control                     9          Gross Up Payment                5.1
Change in Control Event               9          Payment                         5.1
Change in Control Period              4          Underpayment                    5.2
</Table>

2.       TERM.

                  The term of this Agreement shall be for a period commencing as
of the date set forth above and will remain in effect until the earlier of the
date on which (a) all obligations of the parties hereto shall have been
satisfied, (b) the agreement is terminated by the mutual written agreement of
the parties, or (c) the agreement is terminated pursuant to terms contained
elsewhere herein.

<PAGE>

3.       TERMINATION OF EMPLOYMENT OTHER THAN FOLLOWING A CHANGE IN CONTROL
         EVENT.

                  If, prior to a Change in Control Event (as defined in SECTION
9), the Executive's employment is terminated by the Employer with or without
Cause (as defined in SECTION 7) during the term of this Agreement or the
Executive voluntarily terminates his employment with or without Good Reason (as
defined in SECTION 8), this Agreement shall, subject to the provisions contained
in SECTION 17 below, terminate.

4.       TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL EVENT.

                  Subject to the terms of this Agreement, including without
limitation SECTION 17 below, the Executive shall be entitled to receive
severance payments from the Employer for services previously rendered to the
Employer and its affiliates if a Change in Control Event occurs during the term
of this Agreement and the Executive's employment is terminated by the Executive
for Good Reason or by the Employer other than for Cause during the period
commencing upon such Change in Control Event and ending two years after a Change
in Control (as defined in SECTION 9)(the "Change in Control Period").

         4.1.     GOOD REASON; OTHER THAN FOR CAUSE.

                  If a Change in Control Event occurs during the term of this
Agreement and the Employer terminates the Executive's employment other than for
Cause or the Executive terminates employment for Good Reason during the Change
in Control Period:

                  (i) the Employer shall pay to, or provide, the Executive the
         following amounts and benefits:

                           A. all payments and benefits due the Executive
                  pursuant to the terms of paragraph 6(a) of the Offer Letter,
                  together with outplacement support through Right Management
                  Consultants' CEO level program, provided that Executive
                  initiates participation in the program within 60 days of the
                  date of such termination of employment; and

                           B. the amount equal to three (3) times the
                  Executive's Annual Base Salary, which amount shall be payable
                  in full in a lump sum in cash no later than 10 days following
                  the date of termination.

                  (ii) for three (3) years after the date on which the
         Executive's employment with the Employer is terminated, by the Employer
         or by the Executive, for any reason (the "Date of Termination"), or
         such longer period as may be provided by the terms of the appropriate
         plan, program, practice or policy, the Employer shall continue benefits
         to the Executive and/or the Executive's family at least equal to those
         which would have been provided to them in accordance with the welfare
         benefit plans, practices, policies and programs provided by the
         Employer and its affiliated companies (including, without limitation,
         medical, prescription, dental, disability, Executive life, group life,
         accidental death and travel accident insurance plans and programs) to
         the extent applicable generally to other executive-level Executives of
         the Employer and its affiliated companies, as if the Executive's
         employment had not been terminated; provided, that such benefits shall
         be provided to the Executive in a manner that does not cause him to be
         liable for federal income tax thereon in

                                      -2-
<PAGE>

         an amount in excess of that which he would be liable for as an employee
         (or the Employer shall gross up such amounts to so that the Executive
         has no additional after tax cost; and further provided, however, that
         if the Executive becomes reemployed with another employer and is
         eligible to receive medical or other welfare benefits under another
         employer provided plan, the medical and other welfare benefits
         described herein shall be secondary to those provided under such other
         plan during such applicable period of eligibility.

         4.2.     CAUSE; OTHER THAN FOR GOOD REASON.

         IF THE EXECUTIVE'S EMPLOYMENT IS TERMINATED FOR CAUSE DURING THE CHANGE
         IN CONTROL PERIOD, THIS AGREEMENT SHALL TERMINATE WITHOUT FURTHER
         OBLIGATIONS TO THE EXECUTIVE HEREUNDER. FURTHERMORE, IF THE EXECUTIVE
         VOLUNTARILY TERMINATES EMPLOYMENT DURING THE CHANGE IN CONTROL PERIOD
         OTHER THAN FOR GOOD REASON, THIS AGREEMENT SHALL TERMINATE WITHOUT
         FURTHER OBLIGATIONS TO THE EXECUTIVE HEREUNDER.

5.       CERTAIN ADDITIONAL PAYMENTS BY EMPLOYER.

         5.1.     GENERAL

                  Notwithstanding anything in this Agreement to the contrary and
except as set forth in this SECTION 5, in the event it shall be determined that
any payment or distribution by the Employer to or for the benefit of the
Executive (whether paid or payable or distributed or distributable pursuant to
the terms of this Agreement or otherwise, but determined without regard to any
additional payments required under this SECTION 5) (a "Payment") would be
subject to the excise tax imposed by Section 4999 of the Code or any interest or
penalties are incurred by the Executive with respect to such excise tax (such
excise tax, together with any such interest and penalties, are hereinafter
collectively referred to as the "Excise Tax"), then the Executive shall be
entitled to receive an additional payment (a "Gross-Up Payment") in an amount
such that after payment by the Executive of all taxes, including, without
limitation, any income and payroll taxes (and any interest and penalties imposed
with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, the
Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
(including any interest or penalties imposed with respect to such taxes) imposed
upon the Payments.

         5.2.     PROCEDURES

                  Subject to the provisions of SECTION 5.3, all determinations
required to be made under this SECTION 5, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up Payment and the assumptions
to be utilized in arriving at such determination, shall be made by KPMG LLP or
such other certified public accounting firm as may be designated by the
Executive and reasonably acceptable to the Employer (the "Accounting Firm")
which shall provide detailed supporting calculations both to the Employer and
the Executive within 15 business days of the receipt of notice from the
Executive that there has been a Payment, or such earlier time as is requested by
the Employer. In the event that the Accounting Firm is serving as accountant or
auditor for the individual, entity or group effecting the Change in Control, the
Executive may appoint another nationally recognized accounting firm and
reasonably acceptable to the Employer to make the determinations required
hereunder (which accounting firm shall then be referred to as the Accounting
Firm hereunder). All fees and expenses of the Accounting Firm shall be borne
solely by the Employer. Any Gross-Up Payment, as determined pursuant to this
SECTION 5, shall be paid by the

                                      -3-
<PAGE>

Employer to the Executive within five business days of the receipt of the
Accounting Firm's determination. Any determination by the Accounting Firm shall
be binding upon the Employer and the Executive, subject to any determination
otherwise by the Internal Revenue Service. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial determination
by the Accounting Firm hereunder, it is possible that Gross-Up Payments which
will not have been made by the Employer should have been made ("Underpayment"),
consistent with the calculations required to be made hereunder. In the event
that the Employer exhausts its remedies pursuant to SECTION 5.3 and the
Executive thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment shall be promptly paid by the Employer to or for the
benefit of the Executive. In addition, in certain instances an election may be
made to recalculate the Excise Tax under applicable law. The Employer may
exercise such election and cause a recalculation to be made by the Accounting
Firm, subject to the other provisions hereof.

         5.3.     NOTIFICATION OF CLAIMS

                  The Executive shall notify the Employer in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Employer of the Gross-Up Payment. The Executive shall not pay
such claim prior to the expiration of the 30-day period following the date on
which it gives such notice to the Employer (or such shorter period ending on the
date that any payment of taxes with respect to such claim is due). If the
Employer notifies the Executive in writing prior to the expiration of such
period that it desires to contest such claim, the Executive shall:

                  (i) give the Employer any information reasonably requested by
         the Employer relating to such claim,

                  (ii) take such action in connection with contesting such claim
         as the Employer shall reasonably request in writing from time to time,
         including, without limitation, accepting legal representation with
         respect to such claim by attorneys reasonably selected by the Employer,

                  (iii) cooperate with the Employer in good faith in order
         effectively to contest such claim, and

                  (iv) permit the Employer to participate in any proceedings
         relating to such claim;

provided, however, that the Employer shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses. Without limitation on the foregoing provisions of
this SECTION 5.3, the Employer shall control all proceedings taken in connection
with such contest and, at its sole option, may pursue or forgo any and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct
the Executive to pay the tax claimed and sue for a refund or contest the claim
in any permissible manner, and the Executive agrees to prosecute such contest to
a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Employer shall
determine; provided, however, that if the Employer directs the Executive to pay
such claim and sue for a refund, the

                                      -4-
<PAGE>

Employer shall advance the amount of such payment to the Executive, on an
interest-free basis and shall indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income tax (including interest or
penalties with respect thereto) imposed with respect to such advance or with
respect to any imputed income with respect to such advance; and further provided
that any extension of the statute of limitations relating to payment of taxes
for the taxable year of the Executive with respect to which such contested
amount is claimed to be due is limited solely to such contested amount.
Furthermore, the Employer's control of the contest shall be limited to issues
with respect to which a Gross-Up Payment would be payable hereunder and the
Executive shall be entitled to settle or contest, as the case may be, any other
issue raised by the Internal Revenue Service or any other taxing authority.

         5.4.     REFUNDS

                  If, after the receipt by the Executive of an amount advanced
by the Employer pursuant to SECTION 5.3, the Executive becomes entitled to
receive any refund with respect to such claim, the Executive shall (subject to
the Employer's complying with the requirements of SECTION 5.3) promptly pay to
the Employer the amount of such refund (together with any interest actually paid
or credited thereon after taxes applicable thereto). If, after the receipt by
the Executive of an amount advanced by the Employer pursuant to SECTION 5.3, a
determination is made that the Executive shall not be entitled to any refund
with respect to such claim and the Employer does not notify the Executive in
writing of its intent to contest such denial of refund prior to the expiration
of 30 days after such determination, then such advance shall be forgiven and
shall not be required to be repaid and the amount of such advance shall offset,
to the extent thereof, the amount of Gross-Up Payment required to be paid.

         5.5  SARBANES-OXLEY ACT

                  No provision of this Section 5 is intended to be in violation
of the loan prohibitions of the Sarbanes-Oxley Act and to the extent any payment
would be in violation thereof, such amounts shall be deemed a payment to the
Executive with no obligation to refund or otherwise repay.

6.       DEFINITION OF ANNUAL BASE SALARY.

                  Annual base salary ("Annual Base Salary") means the greater of
(a) the annual base salary payable to the Executive by the Employer and its
affiliates as of the Date of Termination of employment (the "Current Annual Base
Salary") or (b) the amount equal to twelve times the highest monthly base salary
paid or payable, including any base salary which has been earned but deferred,
to the Executive by the Employer and its affiliated companies in respect of the
twelve-month period immediately preceding the month in which the Date of
Termination occurs.

7.       DEFINITION OF CAUSE.

"CAUSE" shall have the meaning such term is given in the offer letter.

8.       DEFINITION OF GOOD REASON.

                  "Good Reason" shall have the meaning such term is given in the
         Offer Letter.

9.       DEFINITION OF CHANGE IN CONTROL AND CHANGE IN CONTROL EVENT.

                  A "Change in Control" shall be deemed to have occurred if:

                                      -5-
<PAGE>

                  (a) any "person" (including, without limitation, any
individual, sole proprietorship, partnership, trust, corporation, association,
joint venture, pool, syndicate, or other entity, whether or not incorporated),
or any two or more persons acting as a syndicate or group or otherwise acting in
concert with regard to the ownership of securities of the Employer and thereby
deemed collectively to be a "person") as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")),
becomes, after the date hereof, the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Employer
representing thirty percent (30%) or more of the combined voting power of the
Employer's then outstanding securities, unless, in transaction in which a
"person" becomes, after the date hereof, the "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the
Employer representing less than fifty percent (50%) of the combined voting power
of the Employer's then outstanding securities, prior to the acquisition by such
person of securities of the Employer which causes such person to have such
beneficial ownership, the full Board shall by at least a two-thirds vote have
specifically approved such acquisition and determined that such acquisition
shall not constitute a Change in Control for purposes of this Agreement despite
such beneficial ownership;

                  (b) during any two (2) year period, individuals who at the
beginning of such period constitute the Board, together with any new directors
elected or appointed during the period whose election or appointment resulted
from a vacancy on the Board caused by retirement, death , or disability of a
director and whose election or appointment was approved by a vote of at least
two-thirds (2/3rds) of the directors then still in office who were directors at
the beginning of the period, cease for any reason to constitute a majority
thereof; or

                  (c) the Employer consolidates with, or merges with or into
another entity or sells, assigns, conveys, transfers, leases or otherwise
disposes of all or substantially all of its assets to any person, or any entity
consolidates with, or merges with or into, the Employer (a "Transaction"), in
any such event pursuant to a Transaction in which the owners of outstanding
voting stock of the Employer immediately prior to such Transaction do not
represent at least a majority of the voting power in the surviving entity after
the Transaction in approximately in the same proportions; or

                  (d) the shareholders of the Employer approve a plan of
liquidation or dissolution.

                  A "Change in Control Event" shall mean the earlier of (i) a
Change in Control or (ii) the execution and delivery by the Employer of an
agreement providing for a Change in Control.

10.      EXPENSES.

                  The Employer shall pay any and all reasonable legal fees and
expenses incurred by the Executive in seeking to obtain or enforce, by bringing
an action against the Employer, any right or benefit provided in this Agreement
if the Executive is successful in whole or in part in such action.

11.      WITHHOLDING.

                  Notwithstanding anything in this Agreement to the contrary,
all payments required to be made by the Employer hereunder to the Executive or
his estate or beneficiaries shall be subject to the withholding of such amounts
relating to taxes as the Employer reasonably may determine it should withhold
pursuant to any applicable law or regulation. In lieu of withholding such
amounts,

                                      -6-
<PAGE>

in whole or in part, the Employer may, in its sole discretion, accept other
provisions for the payment of taxes and any withholdings as required by law,
provided that the Employer is satisfied that all requirements of law affecting
its responsibilities to withhold compensation have been satisfied.

12.      NO DUTY TO MITIGATE.

                  The Executive's payments received hereunder shall be
considered severance pay in consideration of past service, and pay in
consideration of continued service from the date hereof and entitlement thereto
shall not be governed by any duty to mitigate damages by seeking further
employment or otherwise and Employer shall not be entitled to any offset for any
amounts Executive earns while receiving payments hereunder.

13.      AMENDMENTS OR ADDITIONS; ACTION BY THE BOARD OF DIRECTORS.

                  No amendments or additions to this Agreement shall be binding
unless in writing and signed by both parties hereto. The prior approval of the
Board shall be required in order for the Employer to authorize any amendments or
additions to this Agreement, unless this requirement is specifically waived in
writing by the Executive in any document affecting any such amendment.

14.      GOVERNING LAW; JURISDICTION.

                  This Agreement shall be governed by the laws of United States
to the extent applicable and otherwise by the laws of the State of Maryland,
excluding any choice of law rules. In the event that an unresolved dispute
arises over the enforcement, interpretation, construction or breach of this
Agreement, the parties agree that it shall be litigated in the U.S. District
Court for the District of Maryland or in the circuit courts of Baltimore City,
Maryland, and the parties hereby irrevocably submit to the exclusive
jurisdiction of such courts for all purposes with respect to any legal action or
proceeding in connection with this Agreement.

15.      ASSIGNMENT.

                  The rights and obligations of the Employer under this
Agreement shall be binding upon its successors and assigns and may only be
assigned by the Employer to the successor in interest of the Employer provided
that such successor executes a written assumption agreement, which is promptly
delivered to the Executive. The rights and obligations of the Executive under
this Agreement shall be binding upon his heirs, legatees, personal
representatives, executors or administrators. This Agreement may not be assigned
by the Executive, but any amount owed to the Executive upon his death shall
inure to the benefit of his heirs, legatees, personal representatives,
executors, or administrators.

16.      NOTICE.

                  For purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when hand delivered, sent by overnight courier,
or mailed by first-class, registered or certified mail, return receipt
requested, postage prepaid, or transmitted by telegram, telecopy, or telex
(against receipt of answerback confirming delivery), addressed as follows:

                  If to the Employer:

                                      -7-
<PAGE>

                  Guilford Pharmaceuticals Inc.
                  6611 Tributary Street
                  Baltimore, Maryland 21224
                  Attn: General Counsel
                  Fax:  410/631-6899

                  If to the Executive, at the address maintained by the
Executive as set forth in the Employer's records or to such other address as
either party may have furnished to the other in writing in accordance herewith,
except that notices of change of address shall be effective only upon receipt.
In the case of notices sent by telegram or telecopy, which notice shall be
deemed duly given if made pursuant to the provisions of this SECTION 16 above,
the notifying party shall also send a confirmation copy of any such notice to
the other party by first class-mail.

17.      OTHER AGREEMENTS.

                  This Agreement may not constitute the entire agreement between
the parties hereto providing for severance payments in connection with a
termination of employment following a Change in Control Event; provided,
however, that if the Executive is entitled to severance payments pursuant to
this Agreement and pursuant to any other oral or written agreements, commitments
or understandings calling for severance payments in connection with a
termination of employment following a Change in Control Event, the severance
payments paid to the Executive by the Employer in connection with such
termination of employment shall be limited to the greater of (i) severance
payments provided pursuant to this Agreement and any share option agreements and
restricted share agreements between the Employer and the Executive or (ii)
severance payments provided by the Employer pursuant to such other oral or
written agreements, commitments or understandings. If the Executive is entitled
to severance payments pursuant to this Agreement and any share option agreements
and restricted share agreements between the Employer and the Executive, on the
one hand, and pursuant to any other oral or written agreements, commitments or
understandings calling for severance payments in connection with a termination
of employment following a Change in Control Event, on the other hand, the
Executive shall determine, in the Executive's sole discretion, by notice given
in writing to the Employer, which payments are greater. For the avoidance of
doubt, the parties agree the terms of this Agreement shall in no way be deemed
to diminish or otherwise modify any terms set forth in any other oral or written
agreements, commitments or understandings related to the payment of severance
amounts to the Executive in connection with a termination of employment that are
not conditioned on a Change in Control Event, including without limitation the
letter agreement between the Employer and the Executive, dated November 16, 2004
(a copy of the form of which agreement is attached hereto for reference
purposes).

18.      SEVERABILITY.

                  If any part of any provision of this Agreement shall be
invalid or unenforceable under applicable law, such part shall be ineffective to
the extent of such invalidity or unenforceability only, without in any way
affecting the remaining parts of such provision or the remaining provisions of
this Agreement.

         IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement, or have caused this Agreement to be executed and delivered, to be
effective as of the date first written above.

                                      -8-
<PAGE>

                                GUILFORD PHARMACEUTICALS INC.

                                By:
                                   ---------------------------------------------
                                   Name: Asher M. Rubin
                                   Title: Senior Vice President, General Counsel
                                             and Secretary

                                EXECUTIVE

                                   ---------------------------------------------
                                   Dean J. Mitchell

                                       -9-

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