TRCA Tercica (MM)

Restricted Stock Unit Awards and Stock Option Awards

On March 25, 2008, as part of the Company’s annual equity compensation grant process, the Committee granted restricted stock unit awards (“RSUs”) to certain of the Company’s employees, including to the named executive officers listed in the table above, under the Company’s 2004 Stock Plan, as amended (the “Plan”). On February 26, 2008, the Board of Directors of the Company (the “Board”) amended the terms of the Plan to provide for the award of RSUs. Prior to such amendment, the Plan provided for the grant of restricted stock awards but not RSUs. The RSUs will be evidenced by a Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreement (together, the “RSU Agreement”), which, together with the Plan, set forth the terms and conditions of the RSUs. Under the Plan and the applicable RSU Agreement, each RSU represents a right to receive one share of the Company’s Common Stock (subject to adjustment for certain specified changes in the capital structure of the Company) upon the completion of a specified period of continued service. On March 25, 2008, the Committee also granted stock options under the Plan to certain of the Company’s employees, including to the named executive officers listed in the table above, which stock options carry an exercise price of $6.13 per share, the fair market value of the Company’s common stock on the date of grant, and have a term of ten years.

The number of RSUs and the number of shares subject to stock options granted to the named executive officers listed in the table above on March 25, 2008 are set forth in the table below, along with a brief description of the vesting conditions applicable to such RSUs and stock option grants.

The foregoing is only a brief description of the material terms of the RSUs and the stock options granted to the named executive officers, does not purport to be complete and is qualified in its entirety by reference to the Plan, the form of RSU Agreement under the Plan and the form of Stock Option Agreement under the Plan. A copy of the form of Stock Option Agreement under the Plan was previously filed as Exhibit 10.3B to the Company’s Registration Statement on Form S-1 and amendments thereto, declared effective on March 16, 2004. The Plan, as amended, and the form of RSU Agreement under the Plan will be filed as exhibits to the Company’s Quarterly Report on Form 10-Q for the quarter ending March 31, 2008.

Amendment to Executive Employment Agreements

On March 25, 2008, the Committee also approved an amendment to each of the employment agreements the named executive officers listed in the tables above previously entered into with the Company to provide that the vesting of the RSUs will be subject to the same change of control vesting acceleration provisions as are applicable to stock options granted to the named executive officers (the “Employment Agreement Amendment”). Accordingly, in the case of each of Mr. Bansal and Mr. Rosenfield, the Employment Agreement Amendment provides that in the event that such named executive officer is terminated without cause or terminates his own employment for good reason within 12 months following a change of control, as these terms are defined in such named executive officer’s employment agreement, the vesting of all of such named executive officer’s RSUs will be accelerated in full. In the case of each of Dr. von Stein and Dr. Grethlein, the Employment Agreement Amendment provides that in the event that such named executive officer is terminated without cause or terminates his own employment for good reason within 12 months following a change of control, as these terms are defined in their respective employment agreements, the vesting of such named executive officer’s RSUs will be accelerated such that 50% of such named executive officer’s unvested RSUs will immediately vest in full.

The foregoing is only a brief description of the material terms of the Employment Agreement Amendment, does not purport to be complete and is qualified in its entirety by reference to the form of Employment Agreement Amendment that will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ending March 31, 2008.