TELIK INC (Form: 10-Q, Received: 08/08/2014 11:59:20)

Large accelerated filer

Accelerated filer

Non-accelerated filer

¨ (Do not check if a smaller reporting company)

Smaller reporting company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED June 30, 2014

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM TO .

COMMISSION FILE NUMBER: 0-31265

TELIK, INC.

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

DELAWARE

93-0987903

(STATE OR OTHER JURISDICTION OF

INCORPORATION OR ORGANIZATION)

(I.R.S. EMPLOYER

IDENTIFICATION NO.)

11588 Sorrento Valley Road, Suite 20, San Diego, CA 92121

(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES INCLUDING ZIP CODE)

(858) 259-9405

(REGISTRANT’S TELEPHONE NUMBER, INCLUDING AREA CODE)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

The number of shares of common stock outstanding as of July 31, 2014 was 13,932,937.

TELIK, INC.

INDEX


			Page

PART I.		FINANCIAL INFORMATION

	Item 1:	Financial Statements (Unaudited)

		Condensed Balance Sheets at June 30, 2014 and December 31, 2013		3

		Condensed Statements of Comprehensive Loss for the three and six months ended June 30, 2014 and 2013		4

		Condensed Statements of Cash Flows for the six months ended June 30, 2014 and 2013		5

		Notes to Condensed Financial Statements		6

	Item 2:	Management’s Discussion and Analysis of Financial Condition and Results of Operations		14

	Item 3:	Quantitative and Qualitative Disclosures About Market Risk		21

	Item 4:	Controls and Procedures		21

PART II.		OTHER INFORMATION

	Item 1.	Legal Proceedings		22

	Item 1A:	Risk Factors		22

	Item 6:	Exhibits		35

SIGNATURES				38

PART I.

FINANCIAL INFORMATION

Item 1.

Financial Statements

TELIK, INC.

CONDENSED BALANCE SHEETS

(In thousands)


	June 30, 2014			December 31, 2013
	(Unaudited)			Audited
Assets
Current assets:
Cash and cash equivalents	$	2,047		$	2,229
Prepaids and other current assets		199			381

Total current assets		2,246			2,610

Total assets	$	2,246		$	2,610

Liabilities, Redeemable Convertible Preferred Stock and Stockholders’ (Deficit) Equity
Current liabilities:
Accounts payable	$	2		$	20
Accrued compensation		175			175
Accrued liabilities		233			169
Accrued contingent lease termination fee		591			591

Total current liabilities		1,001			955
Warrant liability		568			—

Total liabilities		1,569			955
Commitments and contingencies (Note 8)
Redeemable convertible preferred stock		1,711			—
Stockholders’ equity:
Common stock		46			46
Additional paid-in capital		555,142			555,139
Accumulated deficit		(556,222	)		(553,530	)

Total stockholders’ (deficit) equity		(1,034	)		1,655

Total liabilities, redeemable convertible preferred stock and stockholders’ (deficit) equity	$	2,246		$	2,610

See accompanying Notes to Condensed Financial Statements.

TELIK, INC.

CONDENSED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands, except per share amounts)

(Unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Operating costs and expenses:
Research and development	$	81		$	528		$	390		$	1,314
General and administrative		1,575			859			2,334			2,019

Total operating costs and expenses		1,656			1,387			2,724			3,333

Loss from operations		(1,656	)		(1,387	)		(2,724	)		(3,333	)
Interest and other income, net		59			1			59			10

Net loss		(1,597	)		(1,386	)		(2,665	)		(3,323	)
Deemed dividend on redeemable convertible preferred stock		(27	)		—			(27	)		—

Net loss available to common stockholders	$	(1,624	)	$	(1,386	)	$	(2,692	)	$	(3,323	)

Other comprehensive income, net of tax:
Changes in net unrealized gains on investments		—			—			—			—

Comprehensive loss	$	(1,597	)	$	(1,386	)	$	(2,665	)	$	(3,323	)

Basic and diluted net loss per share	$	(0.35	)	$	(0.30	)	$	(0.58	)	$	(0.76	)

Shares used to calculate basic and diluted net loss per share		4,583			4,560			4,583			4,380

See accompanying Notes to Condensed Financial Statements.

TELIK, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(In thousands )

(Unaudited)


	Six Months Ended June 30,
	2014			2013
Cash flows from operating activities:
Net loss	$	(2,665	)	$	(3,323	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense		3			223
Decrease in fair value of warrants		(59	)		—
Changes in assets and liabilities:
Other receivables		—			3
Prepaid expenses and other current assets		182			331
Other assets		—			(70	)
Accounts payable		(18	)		(134	)
Accrued liabilities		64			(313	)
Accrued facility exit costs and contingent lease termination fee		—			(622	)

Net cash used in operating activities		(2,493	)		(3,905	)

Cash flows from investing activities:
Purchases of investments		—			(2,304	)
Maturities of investments		—			1,000

Net cash used in investing activities		—			(1,304	)

Cash flows from financing activities:
Proceeds from issuance of redeemable convertible preferred stock and warrants, net of issuance costs		2,311			—
Proceeds from issuance of common stock, net issuance of costs		—			3,570

Net cash provided by financing activities		2,311			3,570

Net decrease in cash and cash equivalents		(182	)		(1,639	)
Cash and cash equivalents at beginning of period		2,229			4,747

Cash and cash equivalents at end of period	$	2,047		$	3,108

Supplementary information:
Non-cash transaction disclosure:
Transfer of restricted investment in satisfaction of Porter Drive facility lease termination fee	$	—		$	250
Dividends accrued	$	27			—

See accompanying Notes to Condensed Financial Statements.

TELIK, INC.

Notes to Condensed Financial Statements

(Unaudited)

1. Nature of Operations and Going Concern

Business Overview

Telik, Inc., or Telik, we or, the Company, was incorporated in the state of Delaware in October 1988. We are engaged in the discovery and development of small molecule therapeutics. We operate in only one business segment.

We have incurred net losses since inception and we expect to incur substantial losses for the foreseeable future as we continue our research and development activities. To date, we have funded operations primarily through the sale of equity securities, non-equity payments from collaborators and interest income. The process of developing our products will require significant additional research and development, preclinical testing and clinical trials, as well as regulatory approval. We expect these activities, together with general and administrative expenses, to result in substantial operating losses for the foreseeable future. We will not receive product revenue unless we, or our collaborative partners, complete clinical trials, obtain regulatory approval and successfully commercialize one or more of our products.

Private Financing

On May 12, 2014, we entered into a securities purchase agreement, or the PIPE agreement, to sell 1,250,000 shares of our Series B redeemable convertible preferred stock at $2.00 per share for a total of $2.5 million along with warrants to purchase 625,000 shares of common stock at $3.33 per share to a group of private investors led by Hudson Bay Capital Management LP, or Hudson Bay (such transaction, the “PIPE financing”). We received approximately $2.3 million in net proceeds from the sale of shares, after deducting related issuance costs, and used these proceeds to bridge us to the closing of the merger described below.

Merger Agreement

Concurrently on May 12, 2014, we entered into a merger agreement, or Merger Agreement, with MabVax Therapeutics, Inc., or MabVax, a privately held cancer immunotherapy company, or the Merger. On July 8, 2014, or the Closing Date, Telik and MabVax completed the Merger. As a result of the consummation of the Merger, as of the Closing Date, the former stockholders, option holders and warrant holders of MabVax owned approximately 85% of the outstanding shares of Telik common stock on a fully diluted basis and the stockholders, option holders and warrant holders of Telik prior to the Merger owned approximately 15% of the outstanding shares of Telik common stock on a fully diluted basis and a change of control occurred.

For accounting purposes, the Merger is treated as a “reverse acquisition” and MabVax is considered the accounting acquirer. Accordingly, MabVax will be reflected as the predecessor and acquirer in Telik’s financial statements for periods ending from and after the Closing Date. Telik’s financial statements will reflect the historical financial statements for periods ending from and after the Closing Date of MabVax as Telik’s historical financial statements, except for the legal capital which will reflect Telik’s legal capital (common stock).

The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Our ability to continue as a going concern is dependent upon our ability to obtain additional equity or debt financing, attain further operating efficiencies and, ultimately, to generate revenue. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

2. Basis of Presentation and Summary of Significant Accounting Policies

We have prepared the accompanying condensed financial statements in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934, or the Exchange Act. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. We believe all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included herein. Operating results for the three and six months ended June 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014 or any other future period. The condensed balance sheet at December 31, 2013 has been derived from the audited financial statements at that date. You should read these condensed financial statements and notes in conjunction with our audited financial statements for the year ended December 31, 2013, which are included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 10, 2014.

Use of Estimates

In preparing our financial statements to conform with GAAP, we make estimates and assumptions that affect the amounts reported in our financial statements and accompanying notes. Actual results may differ from these estimates.

3. Employee Stock-Based Compensation

Stock-based Compensation

Total estimated stock-based compensation expense, related to all of our share-based payment awards recognized under ASC 718, “Compensation—Stock Compensation” was comprised of the following:


	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)
Research and development	$	—	$	34	$	—	$	92
General and administrative		2		49		3		131

Stock-based compensation expense before taxes		2		83		3		223

Effect on net loss	$	2	$	83	$	3	$	223

Because we had a net operating loss carryforward as of June 30, 2014, no tax benefits for the tax deductions related to stock-based compensation expense were recognized in our Condensed Statements of Comprehensive Loss. Additionally, no stock options were exercised in the three and six months ended June 30, 2014 and 2013. As of June 30, 2014, $4,500 of total unrecognized compensation costs, net of forfeitures, related to non-vested service based awards is expected to be recognized over a weighted average period of 1.35 years.

Valuation Assumptions

We used the Black-Scholes-Merton option valuation model, or the Black-Scholes model, to determine the stock-based expense recognized under ASC 718. Our expected stock-price volatility assumption was based solely on the weighted average of the historical volatility as there was insufficient traded option activity for us to use implied volatility. The expected term of stock awards under our Employee Stock Purchase Plan, or ESPP, was based on the

weighted average purchase periods of each offering. The expected term of stock options granted was based on the simplified method in accordance with Staff Accounting Bulletin No. 110, or SAB 110, as our historical share option exercise experience did not provide a reasonable basis for estimation. The risk-free interest rate was based on the U.S. Treasury yield for a period consistent with the expected term of the stock award in effect at the time of the grant. There were no stock options granted and no new ESPP participants enrolled during the three and six months ended June 30, 2014 and 2013.

4. Basic and Diluted Net Loss per Share

Basic and diluted net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the period.

Weighted average outstanding options to purchase 225,870 and 282,620 shares of our common stock before application of the treasury stock method for the three months ended June 30, 2014 and 2013, 237,990 and 288,681 shares of our common stock before application of the treasury stock method for the six months ended June 30, 2014 and 2013, outstanding redeemable convertible preferred stock of 1,250,000 shares and warrants to purchase 625,000 shares of common stock were excluded from the diluted net loss per common share calculations because inclusion of such shares would be anti-dilutive.

5. Fair Value Measurements on a Recurring Basis

We measure certain financial assets and liabilities at fair value on a recurring basis, including money market funds, US government agencies and warrants. The fair value of these financial instruments is determined based on a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. Government agency securities held in our account were recorded at their estimated fair value. These securities generally had market prices from multiple sources and it could be difficult to select the best individual price directly from the quoted prices in the active markets. Therefore we used Level 2 inputs for the valuation of these securities. Using the Level 2 inputs, a “consensus price” or a weighted average price for each of these securities was derived from a distribution-curve-based algorithm which included market prices obtained from a variety of industrial standard data providers (e.g. Bloomberg), security master files from large financial institutions and other third-party sources.

Warrants are valued using Black-Scholes-Merton model. The expected life is based on the term of the warrants. We use our historical volatility in developing our estimate of expected volatility. The fair value of warrants is estimated using the following assumptions, which, except for risk-free interest rate, are Level 3 inputs:


	June 30, 2014	May 13, 2014 (date of issuance)
Fair value of warrants (in thousands)	$568	$627
Risk-free interest rate	1.62%	1.62%
Dividend yield	N/A	N/A
Expected volatility	101.55%	106.43%
Expected life	4.83	5.00

The following table presents information about our financial instruments that are measured at fair value on a recurring basis as of June 30, 2014 and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value:


			Fair Value Measurement at June 30, 2014 Using
	June 30, 2014		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Financial assets:
Money market funds	$	1,457	$	1,457	$	—	$	—

Total financial assets	$	1,457	$	1,457	$	—	$	—

Financial liabilities:
Warrants	$	568	$	—	$	—	$	568

Total financial liabilities	$	568	$	—	$	—	$	568

The following table presents information about our financial assets that are measured at fair value on a recurring basis as of December 31, 2013, and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value.


			Fair Value Measurement at December 31, 2013 Using
	December 31, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Financial assets: (presented as cash equivalents) :
Money market funds	$	458	$	458	$	—	$	—
US government agencies		1,400		—		1,400		—

Total financial assets	$	1,858	$	458	$	1,400	$	—

The changes in the value of the warrant liability during the six months ended June 30, 2014 were as follows (in thousands):


Fair value – beginning of period	$	—
Issuances		627
Change in fair value		(59	)
Fair value – end of period	$	568

There were no transfers between Level 1 and Level 2 measurements in the three and six months ended June 30, 2014 and in the year ended December 31, 2013.

6. Cash and Cash Equivalents

The following is a summary of estimated fair value of cash and cash equivalents:


	June 30, 2014		December 31, 2013
	(in thousands)
Cash and money market funds	$	2,047	$	829
US government agencies		—		1,400

Total	$	2,047	$	2,229

Reported as:
Cash and cash equivalents	$	2,047	$	2,229

Total	$	2,047	$	2,229

There were no realized gains or losses on sales of available-for-sale securities for the three and six months ended June 30, 2014 and the year ended December 31, 2013. There were no unrealized gains or losses on available-for-sale securities as of June 30, 2014 or December 31, 2013.

All marketable debt securities held as of December 31, 2013 as available-for-sale were expected to mature in less than a year.

7. Accrued Contingent Lease Termination Fee

In November 2010, we ceased the use of our facility at 3165 Porter Drive in Palo Alto, California and subleased the facility to a tenant for the remaining contractual term of our master lease, which is through May 2014. As a result, we recorded a charge of $4.7 million which included the estimated fair value of future lease-related payments less estimated net income from sublease rental offset by a reduction of $335,000 in the balance of deferred rent related to the facility as of November 30, 2010.

On February 19, 2013, we entered into an agreement with our landlord, ARE San Francisco No.24, LLC, or ARE, pursuant to which the premises was voluntarily surrendered, the master lease and sublease were terminated as of February 28, 2013, we were relieved of further obligations under the master lease and further rights to rental income under the sublease, and we agreed to pay a termination fee to ARE of approximately $0.7 million. Prior to the termination of these agreements, the remaining lease payments to ARE through the end of the master lease totaled approximately $4.5 million and the remaining sublease income to Telik through the same period totaled approximately $3.2 million. In addition to the termination fee, if we receive $15 million or more in additional financing in the aggregate, an additional termination fee of $591,000 will be due to ARE, but otherwise be forgiven. As a result of the termination agreement, we reversed the remaining facility exit cost liability, recorded $591,000 as accrued contingent lease termination fee and included the net charge in general and administrative expenses in the Condensed Statements of Comprehensive Loss in the quarter ended March 31, 2013.

8. Commitments

Operating Leases

On February 27, 2013, we entered into a 21-month lease agreement for 3,075 square feet of office space at 2100 Geng Road in Palo Alto, California and relocated our corporate offices to this facility in March 2013. Upon execution of the agreement, we paid the sublessor the first month’s rent and we paid the second month’s rent on March 28, 2013, and deposited into an escrow account approximately $219,000 which represents the total rent due for the remaining term (May 1, 2013 thru November 30, 2014).

We have no future rental payments under our non-cancelable operating leases as of June 30, 2014 and none for the year 2015 and beyond. We recorded a $591,000 contingent lease termination fee, in connection with the termination of our master lease and sublease of our Porter Drive facility, which is payable to ARE if we receive $15 million or more in additional financing in the aggregate, but otherwise forgiven.

Restructuring plan upon closing of the Merger

In connection with the Merger, the company signed separation agreements in May 2014 with nine Telik employees and agreed to pay severances and health benefits upon closing of the Merger subject to certain provisions in the agreement. The total in severance and benefits costs to be paid out is approximately $748,000. This amount has not been accrued at June 30, 2014, since the Merger did not close until July 2014.

9. Redeemable convertible preferred stock and warrants

On May 12, 2014, we entered into a PIPE agreement pursuant to which we issued and sold to the purchasers an aggregate of 1,250,000 shares of our Series B redeemable convertible preferred stock at $2.00 per share for a total of $2.5 million along with warrants to purchase 625,000 shares of our common stock, or the PIPE warrants. We received approximately $2.3 million in net proceeds under the PIPE agreement after deducting related issuance costs.

The Series B redeemable convertible preferred stock sold in the PIPE financing has the following rights:

Conversion Price Adjustment. The conversion price is subject to adjustment upon the earlier of: (i) the date that some or all of the registrable securities have become registered pursuant to an effective registration statement and (ii) 6 months after May 13, 2014, or the Closing Date, each such date, an Adjustment Date, in which the conversion price of the Series B convertible preferred stock thereafter shall be the lower of (a) the initial conversion price and (b) 90% of the average of the 10 lowest weighted average prices of Common Stock during the 20 days immediately preceding the Adjustment Date.

Dividend. 8% cumulative dividend on the Stated Value (as defined in the Series B certificate of designation).

Liquidation Preference. Preferential payment is made to holders of Series B redeemable convertible preferred stock in the event of a liquidation event. Initially, $2.00 per share of Series B convertible preferred stock plus accrued and unpaid dividends, subject to adjustment.

Anti-Dilution. Full ratchet anti-dilution adjustment for any issuances of Common Stock and convertible securities for Common Stock below the current conversion price of $2.00, subject to the beneficial ownership cap of 4.99% of the outstanding Common Stock post-conversion and exchange cap of 19.99% of the outstanding Common Stock immediately prior to such conversion.

We classified our shares of Series B redeemable convertible preferred stock as mezzanine equity as the number of common shares converted are not fixed until the date of the conversion as the conversion amount and conversion price are subject to adjustments, and the preferred shares are subject to a “Change of Control Redemption” provision that allows shares to be redeemable upon the request of preferred stockholders at certain time after the consummation of such Change of Control.

Since our Series B redeemable convertible preferred stockholders are entitled to cumulative dividends on each share held at a rate of 8% per annum on the Stated Value (as defined in the Series B certificate of designations) from and after the first date of issuance of any Series B preferred stock whether or not declared by the Board and whether or not there are funds legally available for the payment of dividends, we recorded $27,000 in dividends accrual for the period ended June 30, 2014.

The PIPE warrants become exercisable six months from May 13, 2014, expire in five years and may be exercised for cash or otherwise may be net-exercised. The PIPE warrants initially have a per share exercise price of

$3.33. On the 60th day following the earlier of (i) the date all of the shares underlying the PIPE warrants become registered pursuant to an effective registration statement and (ii) six months following May 13, 2014, in each case the “reset date”, the exercise price will be reset to equal the lower of (i) the current exercise price and (ii) 90% of the average of the 10 lowest weighted average prices of common stock during the 20 trading days immediately preceding the reset date. Due to the potential change of exercise price per share of the PIPE warrants, the PIPE warrants were recorded as a long term liability. The PIPE warrants are recorded in fair value on a recurring basis, which was $627,000 and $568,000 as of May 13, 2014 and June 30, 2014 respectively. As a result of the change in fair value of the PIPE warrants, we recorded a decrease in fair value of $59,000 during the three months ended June 30, 2014 which was included in Interest income and other net. See Note 5 for more information on the valuation of our PIPE warrants.

10. Litigation

On May 30, 2014, a putative class action lawsuit was commenced in Santa Clara County Superior Court, State of California, on behalf of Cadillac Partners and others similarly situated, naming as defendants our directors, the Company, MabVax, Hudson Bay Capital Management LP, Bio IP Ventures LLC, Hudson Bay Master Fund Ltd., and Hudson Bay IP Opportunities Master Fund LP. The suit alleged the defendants breached certain fiduciary duties, or aided and abetted a breach of fiduciary duties, in connection with our merger with MabVax. In support of their purported claims, the plaintiff alleged, among other things, that our board has historically failed to fulfill its fiduciary duty to its stockholders, the PIPE transaction and the Merger involved an inadequate sales process and includes preclusive deal protection devices, and that our board of directors would receive personal benefits not available to our public stockholders as a result of the Merger. The plaintiff sought to enjoin the Merger and obtain damages as well as attorneys’ and expert fees and costs.

On June 29, 2014, the parties entered into a Stipulation and Settlement, or Settlement, pursuant to which we agreed to file with the SEC certain supplemental disclosures in connection with the Merger, which we did on June 30, 2014 in our proxy statement on Schedule 14A. The Settlement is subject to certain confirmatory discovery to be undertaken by the plaintiff and to the parties’ agreement on the payment of the plaintiff’s attorneys’ fees and expenses.

On July 16, 2014, the Company and all other parties to the litigation entered into an agreement which, if consummated, will settle the litigation, or the proposed settlement. Among many other terms, under the proposed settlement the Company and all defendants will receive a broad release of any and all claims pertaining to the PIPE transaction, the Merger, the prior disclosure and a wide variety of other matters. The proposed settlement also calls for the parties to ask the court to, among other things, enter orders enjoining other shareholders from bringing similar actions, certifying the putative settlement class, and approving the proposed settlement as a fair, final, and binding resolution of the litigation. Under the proposed settlement, the Company and the other defendants have expressly denied the allegations of the complaint and denied engaging in any other misconduct, nor will any of them make any payment or in any respect amend the negotiated terms of the since-consummated PIPE transaction and Merger. Finally, under the proposed settlement, the Company and the other defendants have not agreed to pay any legal fees, or reimburse any expenses, allegedly incurred by the plaintiffs who filed the complaint; instead, the Company expects that counsel for those plaintiffs will present any such disputed claim for legal fees and expenses to the court for resolution. We expect our insurance policy to cover a portion of these fees and expenses, including legal fees of approximately $111,000 incurred by us.

11. Subsequent Events

On July 1, 2014, Telik and MabVax, entered into an Amendment No. 1 to the Merger Agreement to (a) modify the definition of MabVax’s common stock financing in the Merger Agreement, (b) remove certain redemption provisions in the Certificate of Designations, Preferences and Rights of MabVax’s Series A-1 Convertible Preferred Stock and the Certificate of Designations, Preferences and Rights of MabVax’s Series A-2 Convertible Preferred Stock attached to the Merger Agreement, (c) remove certain references to Telik’s obligations to assume MabVax’s obligations to redeem shares of MabVax’s Series C-1 Convertible Preferred Stock and Series C-2 Convertible Preferred Stock following the completion of the Merger.

On July 7, 2014, Telik and the holders of its issued and outstanding Series B Convertible Preferred Stock, entered into a Series B Omnibus Amendment and Stockholder Consent, the Omnibus Amendment that approved an amendment and restatement of Telik’s Certificate of Designations, Preferences and Rights of Series B-1 Convertible Preferred Stock, amendments to the Warrants and the Purchase Agreement to permit Telik’s common stock to be traded on the OTCQB and OTCQX marketplaces, an amendment to the provisions of the Registration Rights Agreement to extend the deadline for filing a registration statement with the SEC covering resales of shares of Telik common stock issuable upon exercise of the Warrants and the shares issuable upon conversion of the Series B Preferred Stock from July 11, 2014 to August 1, 2014, and to approve the amendments made to the Merger Agreement (disclosed below).

On July 7, 2014, Telik and MabVax, entered into an Amendment No. 2 to the Merger Agreement to (a) amend the provisions of the proposed Certificate of Designations, Preferences and Rights of MabVax’s Series A-1 Convertible Preferred Stock attached to the Merger Agreement to permit shares of Telik’s common stock to trade on the OTCQB and OTCQX marketplaces following the completion of the Merger and (b) modify the Telik stockholder approval provisions set forth in the Merger Agreement to permit the Merger to be completed without the consent of the holders of majority of the issued and outstanding capital stock of Telik. Amendment No. 2 also included amendments removing the requirement that Telik amend its charter documents to change its name from Telik, Inc. to MabVax Therapeutics Holding, Inc. upon completion of the Merger and the requirement for Telik to implement a 5 to 1 reverse split of Telik’s common stock should the closing price of Telik’s common stock as of the last business day immediately prior to the effective time of the Merger be less than $4 per share.

On July 8, 2014, or the Closing Date, the Merger was completed. In connection with the Merger, Telik issued, as of the Closing Date, its securities to MabVax’s stockholders in exchange for securities owned by MabVax’s securityholders, as follows: (i) an aggregate of 9,349,841 shares of Telik common stock, (ii) an aggregate of 2,762,841 shares of Telik Series A-1 convertible preferred stock, par value $0.01 per share, convertible into an aggregate of 12,285,156 shares of Telik common stock as of the Closing Date, (iii) warrants to purchase up to an aggregate of 16,442,087 shares of Telik’s common stock, with an exercise price of $0.4524974 per share and expiring on July 10, 2023, and (iv) options to purchase up to 1,552,694 shares of common stock. The Telik securities issued in connection with the Merger were issued in a private placement transaction pursuant to Section 4(2)(a) and Rule 506(b) of Regulation D of the Securities Act. The Common Exchange Ratio (as defined in the Merger Agreement) was 2.223283558 and the Preferred Exchange Ratio (as defined in the Merger Agreement) was .5.

As a result of the consummation of the Merger, as of the Closing Date, the former stockholders, optionholders and warrant holders of MabVax owned approximately 85% of the outstanding shares of Telik common stock on a fully-diluted basis and the stockholders, optionholders and warrant holders of Telik prior to the Merger owned approximately 15% of the outstanding shares of Telik common stock on a fully diluted basis and a change of control has occurred. For accounting purposes, the Merger is treated as a “reverse acquisition” and MabVax is considered the accounting acquirer. Accordingly, MabVax will be reflected as the predecessor and acquirer in Telik’s financial statements. Telik’s financial statements for the periods ending from and after the Closing Date will reflect the historical financial statements of MabVax as Telik’s historical financial statements, except for the legal capital which will reflect Telik’s legal capital (common stock).

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Special Note Regarding Statements of Expected Future Performance

This Quarterly Report on Form 10-Q contains statements indicating expectations about future performance and other forward-looking statements that involve risks and uncertainties. We usually use words such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “future,” “intend,” “potential,” or “continue” or the negative of these terms or similar expressions to identify forward-looking statements. These statements appear throughout this Quarterly Report on Form 10-Q and are statements regarding our current intent, belief or expectation, primarily with respect to our operations and related industry developments. Examples of these statements include, but are not limited to, statements regarding the following: our future operating expenses, our future losses, our future expenditures for research and development, the sufficiency of our cash resources and ability to raise adequate funds in the future, the timing and implications of results of our Phase 2 clinical trials, the progress of our research programs, including clinical testing, the extent to which our issued and pending patents may protect our products and technology, our ability to identify new product candidates using TRAP technology (our proprietary Target-Related Affinity Profiling technology), the potential of such product candidates to lead to the development of safer or more effective therapies, our ability to develop the technology derived from our collaborations, and our anticipated timing for filing additional Investigational New Drug applications, or INDs, with the FDA, or for the initiation or completion of Phase 1, Phase 2 or Phase 3 clinical trials for any of our product candidates, the rights granted to the holders of our Series A-1 convertible preferred stock, the rights granted to the holders of our Series B convertible preferred stock, our limited trading market and the quotation of our shares of common stock on the OTCQB marketplace, dilution to the holders of our common stock related to future issuances and our involvement in potential future litigation. You should not place undue reliance on these forward-looking statements, which apply only as of the date of this Quarterly Report on Form 10-Q. Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us and described in Part II, Item 1A of this Quarterly Report on Form 10-Q.

The following discussion and analysis should be read in conjunction with the unaudited condensed financial statements and notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q and with the financial statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended December 31, 2013, filed with the Securities and Exchange Commission on March 10, 2014.

TELIK, the Telik logo, TRAP, TELCYTA and TELINTRA are trademarks of Telik, Inc. All other brand names or trademarks appearing in this Quarterly Report on Form 10-Q are the property of their respective owners.

Overview

Telik has been engaged in the discovery and development of small molecule drugs. Our business strategy is to advance our drug product candidates through Phase 2 clinical studies, and to enter into a partnership with a pharmaceutical or biotechnology company to assist in further development and commercialization, license product candidates outside our therapeutic focus, and identify and develop additional drug product candidates.

As a consequence of the Merger, Telik’s current technologies and product development candidates will be evaluated by MabVax to determine if additional effort and investment is warranted relative to the product opportunities at MabVax. No assurance can be given that any current technologies or product development candidates currently at Telik will continue in the combined company.

We have incurred significant net losses since inception and expect to incur losses for the foreseeable future as we continue our research and development activities. During the six months ended June 30, 2014, our loss from operations was $2.7 million and our net loss was $2.7 million. Net cash used in operations for the six months ended June 30, 2014 was $2.5 million and cash and cash equivalents at June 30, 2014 were $2.0 million. As of June 30, 2014, we had an accumulated deficit of $556.2 million.

We are subject to risks common to biopharmaceutical companies, including the need for capital, risks inherent in our research, development and commercialization efforts, preclinical testing, clinical trials, uncertainty of regulatory and marketing approvals, enforcement of patent and proprietary rights, potential competition and retention of key employees. In order for a product to be commercialized, it will be necessary for us to conduct preclinical tests and clinical trials, demonstrate efficacy and safety of our product candidates to the satisfaction of regulatory authorities, obtain marketing approval, enter into manufacturing, distribution and marketing arrangements, obtain market acceptance and, in many cases, obtain adequate reimbursement from government and private insurers. We cannot provide assurance that we will ever generate revenues or achieve and sustain profitability in the future or obtain the necessary working capital for our operations.

Private Financing

On May 12, 2014, we entered into a securities purchase agreement to sell 1,250,000 shares of our Series B Convertible Preferred Stock at $2.00 per share for a total of $2.5 million along with warrants to purchase 625,000 shares of common stock at $3.33 per share to a group of private investors led by Hudson Bay. We received approximately $2.3 million in net proceeds from the sale of shares, after deducting related issuance costs, and used it to bridge us to the closing of the merger described below.

Merger Agreement

Concurrently on May 12, 2014, we entered into a merger agreement, or Merger Agreement, with MabVax Therapeutics, Inc., or MabVax, a privately held cancer immunotherapy company, or the Merger. On July 8, 2014, or the Closing Date, Telik and MabVax completed the Merger. As a result of the consummation of the Merger, as of the Closing Date, the former stockholders, option holders and warrant holders of MabVax own approximately 85% of the outstanding shares of Telik common stock on a fully diluted basis and the stockholders, option holders and warrant holders of Telik prior to the Merger owned approximately 15% of the outstanding shares of Telik common stock on a fully diluted basis and a change of control has occurred.

For accounting purposes, the Merger is treated as a “reverse acquisition” and MabVax is considered the accounting acquirer. Accordingly, MabVax will be reflected as the predecessor and acquirer in Telik’s financial statements. Telik’s financial statements for the periods ending from and after the Closing Date will reflect the historical financial statements of MabVax as Telik’s historical financial statements, except for the legal capital which will reflect Telik’s legal capital (common stock).

The combined company of Telik and MabVax, or the combined entity, is subject to risks common to biopharmaceutical companies, including the need for capital, risks inherent in our research, development and commercialization efforts, preclinical testing, clinical trials, uncertainty of regulatory and marketing approvals, enforcement of patent and proprietary rights, potential competition and retention of key employees. In order for a product to be commercialized, it will be necessary for us to conduct preclinical tests and clinical trials, demonstrate efficacy and safety of our product candidates to the satisfaction of regulatory authorities, obtain marketing approval, enter into manufacturing, distribution and marketing arrangements, obtain market acceptance and, in many cases, obtain adequate reimbursement from government and private insurers. We cannot provide assurance that we will ever generate revenues or achieve and sustain profitability in the future or obtain the necessary working capital for our operations.

We expect the quarterly and annual results of operations of the combined entity will fluctuate for the foreseeable future as we continue to identify and advance a number of potential drug candidates into clinical and preclinical development activities, including initiating the manufacturing of our lead antibody candidate and funding operations as we expand our infrastructure. The successful development of our drug product candidates is uncertain. As such, an accurate prediction of future results is difficult or impossible.

Telik – Clinical Product Development

The clinical development of TELINTRA, a small molecule glutathione analog inhibitor of the enzyme glutathione S-transferase P1-1, was suspended in the third quarter of 2013. We have a Phase 3 placebo-controlled randomized registration trial of TELINTRA for the treatment of Low to Intermediate-1 risk MDS, using red-blood-cell transfusion independence as the endpoint, which was designed in accordance with the FDA’s guidance. Telik will evaluate this product relative to others in its pipeline and a determination will be made as to whether the product warrants continued effort. Telik may seek a corporate partner or attempt to out license the program. Until such time as a determination on the potential of the project can be made, the plan to initiate a Phase 3 registration trial of TELINTRA is placed on hold.

Telik – Preclinical Drug Product Development

We have three small molecule compounds in our preclinical development program: TLK60404— a small molecule compound inhibiting both Aurora kinase and VEGFR kinase , TLK60357— a novel, potent small molecule inhibitor of cell division and TLK60357— a potent VGFR kinase inhibitor that blocks the formation of new blood vessels in tumors. While these compounds display anticancer activity against human cancer cells, we have placed these development programs on hold until the combined company can evaluate these programs relative to others in our pipeline and make a determination as to whether any of the programs warrant continued effort. We may seek a corporate partner or attempt to out license any or all of these programs. Until such time as a determination on the potential of these programs can be made, these programs will continue to be placed on hold.

Nasdaq Listing Compliance

On November 14, 2013, we received a notice from The Nasdaq Stock Market LLC, or Nasdaq, indicating that we no longer satisfied the minimum $2,500,000 stockholders’ equity requirement for continued listing on The Nasdaq Capital Market and providing us the opportunity to submit a plan to regain compliance with that requirement. On December 30, 2013, we submitted to Nasdaq a plan to regain compliance.

On January 9, 2014, following its review of the plan, we received a notice from Nasdaq that it had determined to delist our securities based on the stockholders’ equity deficiency unless we request a hearing before The Nasdaq Listing Qualifications Panel, or the Panel. We requested a hearing, and a hearing before the Panel was held on February 20, 2014, at which time we presented our plan to evidence compliance with the requirements for continued listing on The Nasdaq Capital Market. On February 25, 2014, we received a notice from Nasdaq that the Panel had granted our request for continued listing on The Nasdaq Capital Market, provided we evidence compliance with the $2,500,000 stockholders’ equity requirement by May 30, 2014.

On May 21, 2014, we received a notice from the Panel granting our request for continued listing on The Nasdaq Capital Market, provided that by July 8, 2014, we close the Merger and the combined company qualifies for initial listing on the Capital Market. Telik may also continue to be listed on The Nasdaq Capital Market by independently regaining compliance with the continued listing requirements of The Nasdaq Capital Market by July 8, 2014 through a financing or licensing transaction.

Pursuant to the terms of the Panel’s decision and as disclosed above, on July 8, 2014, Telik completed the Merger, and the combined entity was required to evidence compliance with all applicable requirements for initial listing on The Nasdaq Capital Market upon completion of the merger, including the $4.00 minimum stock price requirement, or to otherwise evidence compliance with the requirements for continued listing on The Nasdaq Capital Market on a stand-alone basis. Due to the failure of Telik to obtain the approval of its stockholders of the 5 to 1 reverse stock split described in our proxy statement filed with the SEC on June 3, 2014, or the reverse split, the new

combined company was not in a position to evidence full compliance with the terms of the Panel’s decision dated May 21, 2014, to meet the July 8 ^th deadline and the Panel issued a determination to suspend trading in the Company’s securities on The Nasdaq Capital Market effective as of market open on July 10, 2014. Commencing on July 10, 2014, shares of our common stock began trading on the OTCQB marketplace under the symbol “TELK”.

We have appealed the Panel’s decision to the Nasdaq Listing and Hearing Review Council, or the Nasdaq Listing Council, requesting additional time to obtain the necessary votes to approve the reverse stock split and to demonstrate compliance with all applicable requirements for initial listing on The Nasdaq Capital Market, including the $4.00 minimum stock price requirement. As described in our proxy statement filed with the SEC on July 25, 2014, we scheduled a stockholder’s meeting for August 20, 2014 soliciting stockholder approval for, among other items, the reverse split and an amendment to our amended and restated certificate of incorporation to change our name to MabVax Therapeutics Holdings, Inc. and to increase the authorized number of our common shares to a new total of 150,000,000 and our authorized number of preferred shares to a new total of 15,000,000.

Critical Accounting Policies and Significant Judgments and Estimates

Our management’s discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported revenues and expenses during the reporting periods. On an on-going basis, we evaluate our estimates and judgments related to our operating costs. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ significantly from these estimates under different assumptions or conditions.

There has been no material change in our critical accounting policies and significant judgments and estimates as described in our Annual Report on Form 10-K for the year ended December 31, 2013.

Results of Operations

Research and Development Expenses

Our research and development costs in the three and six months ended June 30, 2014 were primarily for the completion of all clinical study reports associated with the wind down of our clinical trials in 2013 including the filing of annual safety reports, drug storage and headcount related expenses.


	Three Months Ended June 30,				%			Six Months Ended June 30,				%
	2014		2013		Change			2014		2013		Change
	(In thousands, except percentages)
Research and development	$	81	$	528		(85	)%	$	390	$	1,314		(70	)%

The decrease of 85%, or $447,000, in research and development expenses for the three months ended June 30, 2014 compared to the same period in 2013, was primarily due to the following:

•

decreased costs of $345,000 associated with headcount reduction, reduced stock-based compensation of approximately $34,000 and a $48,000 decrease in allocated facility and IT costs as a result of our relocation to a smaller corporate office space in March 2013; and

•

a decrease of approximately $20,000 in our phase 2 clinical studies for TELINTRA as we have closed out all our clinical sites.

The decrease of 70%, or $924,000, in research and development expenses for the six months ended June 30, 2014 compared to the same period in 2013, was primarily due to the following:

•

decreased costs of $567,000 associated with headcount reduction, reduced stock-based compensation of approximately $92,000 and a $125,000 decrease due to lower allocated facility and IT costs; and

•

a decrease of approximately $140,000 in our phase 2 clinical studies for TELINTRA as we have closed out all our clinical sites.

As a result of the consummation of the Merger, we expect future research and development expenditures of the combined company will increase as we advance our lead drug candidates into preclinical and clinical development activities including initiating manufacturing of our lead antibody candidate.

General and Administrative Expenses


	Three Months Ended June 30,				%			Six Months Ended June 30,				%
	2014		2013		Change			2014		2013		Change
	(In thousands, except percentages)
General and administrative	$	1,575	$	859		83	%	$	2,334	$	2,019		16	%

The increase in general and administrative expenses of 83%, or $716,000, for the three months ended June 30, 2014 compared to the same period in 2013, was primarily due to an increase in merger related legal and professional services expenses.

The increase in general and administrative expenses of 16%, or $315,000, for the six months ended June 30, 2014 compared to the same period in 2013 was primarily due to the following:

•

an increase in merger related legal and professional services expenses of $507,000;

•

partially offset by decreases of $129,000 related to stock-based compensation, and $63,000 in corporate administrative and facility related expenses.

As a result of the consummation of the Merger, we expect our future general and administrative expenditures to increase. While merger related expenses will have ended, the combined company will incur additional expenses related to being a public company. We expect the increase to be attributable to expanding our corporate infrastructure, increased legal expenses, increased insurance requirements, and fees related to regulatory filings.

Stock-Based Compensation Expense

Employee stock-based compensation expense related to our share-based payment awards was as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(In thousands)
Research and development	$	—	$	34	$	—	$	92
General and administrative		2		49		3		131

Stock-based compensation expense before taxes		2		83		3		223

Effect on net loss	$	2	$	83	$	3	$	223

The decreases in employee stock-based compensation expense for the three and six months ended June 30, 2014 compared with the same periods in 2013 were primarily due to having fewer option shares vested in 2014.

Interest Income and Interest Expense


	Three Months Ended June 30,				%			Six Months Ended June 30,				%
	2014		2013		Change			2014		2013		Change
	(In thousands, except percentages)
Interest and other income, net	$	59	$	1		5800	%	$	59	$	10		490	%

The increase in interest and other income, net of approximately $58,000 for the three months ended June 30, 2014 compared to the same period in 2013 was due primarily to the decrease in fair value of the PIPE warrants. The increase in interest and other income, net of approximately $49,000 for the six months ended June 30, 2014 compared to the same period in 2013 was due primarily to the decrease in fair value of the PIPE warrants, partially offset by a gain from the sale of office equipment recorded during the six months ended June 30, 2013.

Liquidity and Capital Resources


	June 30, 2014			December 31, 2013
	(In millions, except ratios)
Cash and cash equivalents	$	2.0		$	2.2
Working capital	$	1.2		$	1.7
Current ratio		2.2 : 1			2.7 : 1

	Six Months Ended June 30,
	2014			2013
	(In millions)
Cash (used in) / provided by:
Operating activities	$	(2.5	)	$	(3.9	)
Investing activities	$	—		$	(1.3	)
Financing activities	$	2.3		$	3.6

Sources and Uses of Cash . Due to historically significant research and development expenditures and the lack of any approved products to generate revenue, we have not been profitable and have generated operating losses since we incorporated in 1988. As such, we have funded our research and development operations through the sale of equity securities, non-equity payments from corporate partners, interest earned on investments, government grants and equipment lease and loan financings. At June 30, 2014, we had available cash and cash equivalents of $2.0 million. Our cash and investment balances are held in a variety of interest-bearing instruments including money market accounts. Cash in excess of immediate requirements is invested with regard to liquidity and capital preservation. Wherever possible, we seek to minimize the potential effects of concentration and degrees of risk.

Cash Flows from Operating Activities. Cash used in operations for the six months ended June 30, 2014 was $2.5 million compared with $3.9 million for the same period in 2013. Net loss of $2.7 million in the six months ended June 30, 2014 included non-cash charges of $3,000 for stock-based compensation and a $59,000 decrease in fair value of the PIPE warrants. Cash used in operations was impacted by an $182,000 reduction in prepaid expenses due to decreases in prepaid insurance and prepaid rent balances. Operating cash outflows for the same period in 2013 resulted primarily from a net loss of $3.3 million which included non-cash charges of $223,000 for stock-based compensation. Cash used in 2013 was impacted by a $622,000 net reduction in accrued facility exit costs primarily due to our lease termination agreements for our Porter Drive facility which is detailed in Note 7 of the Notes to Condensed Financial Statements. Cash used in operations in 2013 also included a $313,000 reduction in accrued liabilities primarily due to payments related to our annual audit and franchise tax.

Cash Flows from Investing Activities . There were no investing activities for the six months ended June 30, 2014 compared with $1.3 million cash used for the same period in 2013. Cash used in investing activities in 2013 was primarily from $2.3 million in the purchase of available-for-sale investments and was partially offset by $1.0 million in investment maturities. We had no capital expenditures for the six months ended June 30, 2014 or 2013.

Cash Flows from Financing Activities . Cash provided by financing activities for the six months ended June 30, 2014 was $2.3 million compared with $3.6 million cash provided for the same period in 2013. Cash provided by financing activities for the six months ended June 30, 2014 was from the sale of our Series B redeemable convertible preferred stock and warrants in the PIPE financing. Cash provided by financing activities for the same period in 2013 was from sales of our common stock under the Sales Agreement with MLV, or the Sales Agreement, of about $3.6 million in net proceeds.

Working Capital . Working capital decreased to $1.2 million at June 30, 2014 from $1.7 million at December 31, 2013. The decrease in working capital was primarily due to our use of cash for operating expenses.

Future Contractual Obligations. We currently have no future rental payment obligations under non-cancelable operating leases. Our master lease and sublease of our facility located at 3165 Porter Drive in Palo Alto, California were terminated on February 28, 2013 and we entered into a termination agreement with ARE on February 19, 2013 to voluntarily surrender our premises. As a result of the termination agreement, we were relieved of further obligations under the master lease and further rights to rental income under the sublease and paid a termination fee of approximately $0.7 million. In addition to the termination fee, if we receive $15 million or more in additional financing in the aggregate, an additional termination fee of $591,000 will be due to ARE, but will otherwise be forgiven.

On February 27, 2013, we entered into an arrangement to sublease a facility at 2100 Geng Road, Suite 102, Palo Alto, California in which to relocate our principal executive offices as the sublease of our former facility at 700 Hansen Way, Palo Alto, California expired on March 31, 2013. Upon execution of the agreement, we paid the sublessor the first month’s rent with second month’s rent due on March 28, 2013, and deposited into an escrow account approximately $219,000 which represents the total rent due for the remaining term (May 1, 2013 through November 30, 2014).

Off-Balance Sheet Arrangements

We have no material off-balance sheet arrangements as defined in Regulation S-K 303(a)(4)(ii).

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

There have been no material changes in our market risk during the six months ended June 30, 2014 compared to the disclosures in Part II, Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2013, filed with the SEC on March 10, 2014.

Item 4.

Controls and Procedures.

Evaluation of disclosure controls and procedures . Our management, with the participation of our President and Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of June 30, 2014. Based on such evaluation, our President and Chief Executive Officer and Chief Financial Officer concluded that, subject to limitations described below, our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act), were effective as of June 30, 2014.

Changes in internal control over financial reporting . As discussed above, we completed the Merger on July 8, 2014 and we are currently in the process of evaluating and integrating internal controls over financial reporting of the parties to the Merger. During the quarter ended June 30, 2014, other than the changes to our internal control process resulting from the Merger, there were no changes in our internal controls over financial reporting identified in management’s evaluation pursuant to Rule 13a-15(d) of the Exchange Act during the quarter ended June 30, 2014 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Limitations on the effectiveness of controls . A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected. Accordingly, our disclosure controls and procedures are designed to provide reasonable, not absolute, assurance that the objectives of our disclosure control system are met and, as set forth above, our President and Chief Executive Officer and Chief Financial Officer have concluded, based on their evaluation as of the end of the period covered by this report, that our disclosure controls and procedures were sufficiently effective to provide reasonable assurance that the objectives of our disclosure control system were met.

PART II.

OTHER INFORMATION

Item 1.

Legal Proceedings.

On May 30, 2014, a putative class action lawsuit was commenced in Santa Clara County Superior Court, State of California, on behalf of Cadillac Partners and others similarly situated, naming as defendants our directors, the Company, MabVax, Hudson Bay Capital Management LP, Bio IP Ventures LLC, Hudson Bay Master Fund Ltd., and Hudson Bay IP Opportunities Master Fund LP. The suit alleges the defendants breached certain fiduciary duties, or aided and abetted a breach of fiduciary duties, in connection with the Merger. In support of their purported claims, the plaintiff alleged, among other things, that our board has historically failed to fulfill its fiduciary duty to its stockholders, the PIPE transaction and the Merger involved an inadequate sales process and includes preclusive deal protection devices, and that our board of directors would receive personal benefits not available to our public stockholders as a result of the Merger. The plaintiff sought to enjoin the Merger and obtain damages as well as attorneys’ and expert fees and costs.

On June 29, 2014, the parties entered into a Stipulation and Settlement, or settlement, pursuant to which we agreed to file with the SEC certain supplemental disclosures in connection with the merger, which we did on June 30, 2014 in our proxy statement on Schedule 14A. The settlement is subject to certain confirmatory discovery to be undertaken by the plaintiff and to the parties’ agreement on the payment of the plaintiff’s attorneys’ fees and expenses.

On July 16, 2014, the Company and all other parties to the litigation entered into an agreement which, if consummated, will settle the litigation, the proposed settlement. Among many other terms, under the proposed settlement the Company and all defendants will receive a broad release of any and all claims pertaining to the PIPE transaction, the Merger, the prior disclosure and a wide variety of other matters. The proposed settlement also calls for the parties to ask the court to, among other things, enter orders enjoining other shareholders from bringing similar actions, certifying the putative settlement class, and approving the proposed settlement as a fair, final, and binding resolution of the litigation. Under the proposed settlement, the Company and the other defendants have expressly denied the allegations of the complaint and denied engaging in any other misconduct, nor will any of them make any payment or in any respect amend the negotiated terms of the since-consummated PIPE transaction and Merger. Finally, under the proposed settlement, the Company and the other defendants have not agreed to pay any legal fees, or reimburse any expenses, allegedly incurred by the plaintiffs who filed the complaint; instead, the Company expects that counsel for those plaintiffs will present any such disputed claim for legal fees and expenses to the court for resolution. We expect our insurance policy to cover a portion of these fees and expenses.

Item 1A.

Risk Factors.

Included below is a description of risk factors related to our business to enable readers to assess, and be appropriately apprised of, many of the risks and uncertainties applicable to the forward-looking statements made in this Quarterly Report on Form 10-Q. The risks and uncertainties set forth below are not all of the risks and uncertainties facing our business, but we do believe that they reflect the more important ones. You should carefully consider these risk factors as each of these risks could adversely affect our business, operating results and financial condition. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements.

The risk factors described in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2013, as filed with the SEC on March 10, 2014, are set forth below. These risk factors have not substantively changed, except for those identified by asterisk and restated below.

If we are unable to raise adequate funds in the near future, we will not be able to continue to fund our operations, research programs, preclinical testing and clinical trials to develop and manufacture our drug product candidates, and our auditors have indicated that our recurring losses and net capital deficiency raise substantial doubt about our ability to continue as a going concern.

Our independent registered public accounting firm has issued a report on our financial statements that includes an explanatory paragraph referring to our recurring losses from operations and expressing substantial doubt as to our ability to continue as a going concern without additional capital becoming available. While we were able to raise $3.6 million in 2013 and $2.5 million in May 2014, we believe our existing cash and investment securities will only be sufficient to support our operations through approximately July 2014 for the closing of the Merger. Any failure to dispel any continuing doubts about our ability to continue as a going concern could make it more difficult to obtain required financing on favorable terms or at all, negatively affect the market price of our common stock and could otherwise have a material adverse effect on our business, financial condition and results of operations. We could be required to liquidate our assets, seek bankruptcy protection or other alternatives and it is likely that investors will lose all or some of their investment in us. In addition, the tight credit markets and concerns regarding the availability of credit, particularly in the United States, may also negatively impact our ability to raise additional capital to fund our business. We cannot assure you that any future actions that we may take will raise or generate sufficient capital to fully address the significant uncertainties of our financial position. Moreover, we may not successfully identify or implement any of the above alternatives, and, even if we determine to pursue one or more of these alternatives, we may be unable to do so on a timely basis or on acceptable financial terms. As a result, we may be unable to realize value from our assets and discharge our liabilities in the normal course of business. All of these factors raise substantial doubt about our ability to continue as a going concern.

Raising additional capital by issuing securities or through collaboration and licensing arrangements may cause dilution to existing stockholders or require us to relinquish rights to our technologies or product candidates.

In order to fund our current and future operations, including the initiation of a Phase 3 registration trial of TELINTRA, we need to raise additional funds through equity or debt financings, collaborative arrangements with corporate partners or other sources. On August 30, 2011, we entered into an At Market Issuance Sales Agreement, or the Sales Agreement with McNicoll, Lewis & Vlak LLC, or MLV, pursuant to which we may issue and sell shares of our common stock having an aggregate offering price up to $7.0 million, from time to time, through the Sales Agreement. As of December 31, 2013, we sold 2,782,887 shares of our common stock and received approximately $5.8 million in net proceeds since entering into the Sales Agreement. On May 12, 2014, we entered into an agreement to sell 1,250,000 shares of convertible preferred stock to a group of investors for a total of $2.5 million. Our ability to sell shares of our common and preferred stock is subject to share volume limitations, market conditions and our continued listing on the Nasdaq Capital Market.

To the extent that we raise additional capital by issuing equity securities, our stockholders will experience dilution. To the extent that we raise additional capital through licensing arrangements or arrangements with collaborative partners, we may be required to relinquish, on terms that are not favorable to us, rights to some of our technologies or product candidates that we would otherwise seek to develop or commercialize ourselves.

We have a history of net losses, which we expect to continue for the next several years should we have the ability to operate as a going concern. We will never be profitable unless we develop, and obtain regulatory approval and market acceptance of, our product candidates.

To date, we have not obtained regulatory approval for the commercial sale of any products, and we have not received any revenue from the commercial sale of products. Due to the significant research and development expenditures required to develop our technology and identify new product candidates, and the lack of any products to generate revenue, we have not been profitable and have incurred operating losses since we were incorporated in 1988. As of June 30, 2014, we had an accumulated deficit of $556.2 million. Should we have the ability to operate as a going concern, we expect to incur losses for the next several years as we continue our research and development activities and incur significant clinical testing and drug supply manufacturing costs. We do not anticipate that we will generate product revenue for at least several years. Our losses, among other things, have caused and will cause

our stockholders’ equity and working capital to decrease. We expect that this trend will continue until we develop, and obtain regulatory approval and market acceptance of, our product candidates, if at all. We may never generate product revenue sufficient to become profitable.

If clinical trials of our product candidates are delayed or unsuccessful, or if we are unable to complete the preclinical development of our other preclinical product candidates, our business may suffer.

Preclinical testing and clinical trials are long, expensive and uncertain processes. It may take us or our collaborators several years to complete this testing, and failure can occur at any stage of the process. Success in preclinical testing and early clinical trials does not ensure that later clinical trials will be successful, and interim results of clinical trials do not necessarily predict final results. A number of companies in the pharmaceutical industry, including biotechnology companies, have suffered significant setbacks in advanced clinical trials, even after promising results in earlier clinical trials. To obtain regulatory approvals, we must, among other requirements, complete carefully controlled and well-designed clinical trials demonstrating that a particular drug is safe and effective for the applicable disease. In order to complete such trials, we will need to raise significant additional funds.

We rely on third-party clinical investigators to conduct our clinical trials and, as a result, we may face additional delays outside our control. We have in the past engaged contract research organizations, or CROs, to facilitate the administration of our Phase 3 clinical trials. Dependence on a CRO subjects us to a number of risks. We may not be able to control the amount and timing of resources the CRO may devote to our clinical trials. Should the CRO fail to administer our Phase 3 clinical trials properly and on a timely basis, regulatory approval, development and commercialization of our product candidates will be delayed.

We do not know whether we will begin planned clinical trials on time or whether we will complete any of our on-going clinical trials on schedule, if at all. Clinical trials can be delayed for a variety of other reasons, including delays in clinical testing, obtaining regulatory approval to commence a study, delays in reaching agreement on acceptable clinical study agreement terms with prospective clinical sites, delays in obtaining institutional review board approval to conduct a study at a prospective clinical site and delays in recruiting subjects to participate in a study. Even if we are able to complete such clinical trials, we do not know whether any such trials will result in marketable products. Typically, there is a high rate of failure for product candidates in preclinical and clinical trials. We do not anticipate that any of our product candidates will reach the market for at least the next several years.

Delays in clinical testing can also materially impact our product candidates’ development costs. If we experience delays in clinical testing or approvals, our product candidates’ development costs will increase. For example, we may need to make additional payments to third-party investigators and organizations to retain their services or we may need to pay additional recruitment incentives. If the delays are significant, our financial results and the commercial prospects for our product candidates will be harmed, and our ability to remain viable will be significantly impaired or delayed.

If we do not find collaborators for our product candidates, we may have to reduce or delay our rate of product development and/or increase our expenditures.

Our strategy to develop, manufacture and commercialize our products includes entering into relationships with pharmaceutical companies to advance certain programs and reduce our expenditures with respect to such programs. Our product candidates will target highly competitive therapeutic markets in which we have limited experience and expertise. If we are unable to develop this expertise ourselves, we will need to enter into agreements with one or more biotechnology or pharmaceutical companies to provide us with the necessary resources and experience for the development and commercialization of products in these markets. In particular, we are seeking a partnership with a pharmaceutical or biotechnology company to further advance the development and commercialization of TELINTRA. There are a limited number of companies with the resources necessary to develop our future products commercially, and we may be unable to attract any of these firms. The current credit and financial market conditions

could also impact our ability to find a collaborator for our development programs. A company that has entered into a collaboration agreement with one of our competitors may choose not to enter into a collaboration agreement with us. We may not be able to negotiate a collaboration agreement on acceptable terms or at all. If we are not able to establish collaborative arrangements, we may have to reduce or delay further development of some of our programs and/or increase our expenditures and undertake the development activities at our own expense. If we elect to increase our expenditures to fund our development programs, we will need to obtain additional capital, which may not be available on acceptable terms or at all.

In addition, there have been a significant number of recent business combinations among biotechnology and pharmaceutical companies that have reduced the number of potential future collaborators that would be willing to enter into a collaboration agreement with us. If business combinations involving potential collaborators continue to occur, our ability to find a collaborative partner could be diminished, which could result in the termination or delay in one or more of our product candidate development programs.

We will depend on collaborative arrangements to complete the development and commercialization of some of our product candidates. These collaborative arrangements may place the development of our product candidates outside of our control, may require us to relinquish important rights or may otherwise not be on terms favorable to us.

We may enter into collaborative arrangements with third parties for clinical trials, development, manufacturing, regulatory approvals or commercialization of some of our product candidates. Dependence on collaborative arrangements will subject us to a number of risks. We may not be able to control the amount and timing of resources our collaborative partners may devote to the product candidates. Our collaborative partners may experience financial difficulties. Should a collaborative partner fail to develop or commercialize a compound or product candidate to which it has rights from us, we may not receive any future milestone payments and will not receive any royalties for that compound or product candidate. Business combinations or significant changes in a collaborative partner’s business strategy may also adversely affect a partner’s willingness or ability to complete its obligations under an arrangement. If we fail to enter into additional collaborative agreements on favorable terms, our business, financial condition and results of operations could be materially adversely affected.

If our competitors develop and market products that are more effective than our product candidates or any products that we may develop, or obtain marketing approval before we do, our commercial opportunity will be reduced or eliminated.

The biotechnology and pharmaceutical industries are intensely competitive and subject to rapid and significant technological change. Some of the drugs that we are attempting to develop will have to compete with existing therapies. In addition, a large number of companies are pursuing the development of pharmaceuticals that target the same diseases and conditions that we are targeting. We face competition from pharmaceutical and biotechnology companies in the United States and abroad. Our competitors may develop new screening technologies and may utilize discovery techniques or partner with collaborators in order to develop products more rapidly or successfully than we or our collaborators are able to do.

Many of our competitors, particularly large pharmaceutical companies, have substantially greater financial, technical and human resources than we do. These organizations also compete with us to attract qualified personnel and parties for acquisitions, joint ventures, licensing arrangements or other collaborations. In addition, academic institutions, government agencies and other public and private organizations conducting research may seek patent protection with respect to potentially competing products or technologies and may establish exclusive collaborative or licensing relationships with our competitors.

Our competitors may succeed in developing technologies and drugs that are more effective, better tolerated or less costly than any which are being developed by us or which would render our technology and potential drugs obsolete and noncompetitive. In addition, our competitors may succeed in obtaining FDA or other regulatory

approvals for product candidates more rapidly than us or our collaborators. Any drugs resulting from our research and development efforts, or from our joint efforts with our existing or future collaborative partners, may not be able to compete successfully with our competitors’ existing products or product candidates under development or may not obtain regulatory approval in the United States or elsewhere.

If we do not obtain regulatory approval to market products in the United States and foreign countries, we or our collaborators will not be permitted to commercialize our product candidates.

Even if we are able to achieve success in our preclinical testing, we, or our collaborators, must provide the FDA and foreign regulatory authorities with clinical data that demonstrate the safety and efficacy of our product candidates in humans before they can be approved for commercial sale. Failure to obtain regulatory approval will prevent commercialization of our product candidates.

The pharmaceutical industry is subject to stringent regulation by a wide range of regulatory authorities. We cannot predict whether regulatory clearance will be obtained for any product candidate that we are developing or hope to develop. A pharmaceutical product cannot be marketed in the United States until it has completed rigorous preclinical testing and clinical trials and an extensive regulatory clearance process implemented by the FDA. Satisfaction of regulatory requirements typically takes many years and depends on the type, complexity and novelty of the product candidate and requires the expenditure of substantial resources. Of particular significance are the requirements covering research and development, testing, manufacturing, quality control, labeling and promotion of drugs for human use.

Before commencing clinical trials in humans, we, or our collaborators, must submit and receive approval from the FDA of an IND application. We must comply with FDA “Good Laboratory Practices” regulations in our preclinical studies. Clinical trials are subject to oversight by Institutional Review Boards, or IRBs, of participating clinical sites and the FDA and:

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must be conducted in conformance with the FDA regulations;

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must meet requirements for IRB approval;

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must meet requirements for informed consent;

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must meet requirements for Good Clinical Practices;

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may require large numbers of participants; and

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may be suspended by us, our collaborators or the FDA at any time if it is believed that the subjects participating in these trials are being exposed to unacceptable health risks or if the FDA finds deficiencies in the IND application or the conduct of these trials. An IRB may also require the clinical trial at the site to be halted, either temporarily or permanently, for failure to comply with the IRB’s requirements, or may impose other conditions.

Before receiving FDA clearance to market a product candidate, we, or our collaborators must demonstrate that the product candidate is safe and effective in the patient population that will be treated. Negative or inconclusive results or adverse medical events during a clinical trial could cause a clinical trial to be repeated, a program to be terminated and could delay approval. We typically rely on third-party clinical investigators to conduct our clinical trials and other third-party organizations to perform data collection and analysis. As a result, we may face additional delaying factors outside our control. In addition, we may encounter delays or rejections based upon additional government regulation from future legislation or administrative action or changes in FDA policy or interpretation during the period of product development, clinical trials and FDA regulatory review. Failure to comply with applicable FDA or other applicable regulatory requirements may result in criminal prosecution, civil penalties, recall or seizure of products, total or partial suspension of production or injunction, as well as other regulatory action. We have limited experience in conducting and managing the clinical trials necessary to obtain regulatory approval.

If regulatory clearance of a product candidate is granted, this clearance will be limited to those disease states and conditions for which the product candidate is demonstrated through clinical trials to be safe and efficacious,

which could limit our market opportunity. Furthermore, product approvals, once granted, may be withdrawn if problems occur after initial marketing. We cannot ensure that any product candidate developed by us, alone or with others, will prove to be safe and efficacious in clinical trials and will meet all of the applicable regulatory requirements needed to receive marketing clearance. Regulatory clearance may also contain requirements for costly post-marketing testing and surveillance to monitor the safety and efficacy of the product candidate. If problems occur after initial marketing, such as the discovery of previously unknown problems with our product candidates, including unanticipated adverse events or adverse events of unanticipated severity or frequency, or manufacturer or manufacturing issues, marketing approval can be withdrawn.

Outside the United States, the ability to market a product depends on receiving a marketing authorization from the appropriate regulatory authorities. Most foreign regulatory approval processes include all of the risks associated with FDA clearance described above and some may include additional risks.

If we or our licensees cannot obtain and defend our respective intellectual property rights, or if our product candidates, technologies or any products that we may develop are found to infringe patents of third parties, we could become involved in lengthy and costly legal proceedings that could adversely affect our business.

Our success will depend in a large part on our own and our licensees’ ability to obtain and defend patents for each party’s respective technologies and the compounds and other products, if any, resulting from the application of these technologies. The patent positions of pharmaceutical and biotechnology companies can be highly uncertain and involve complex legal and factual questions. As a result, the degree of future protection for our proprietary rights is uncertain, and we cannot assure you that:

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we were the first to make the inventions covered by each of our pending patent applications;

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we were the first to file patent applications for these inventions;

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others will not independently develop similar or alternative technologies or duplicate any of our technologies;

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any of our pending patent applications will result in issued patents;

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any patents issued to us or our collaborators will provide a basis for commercially viable products, will provide us with any competitive advantages or will not be challenged by third parties;

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any of our issued patents will be valid or enforceable; or

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we will develop additional proprietary technologies that are patentable.

Accordingly, we cannot predict the breadth of claims allowed in our or other companies’ patents.

We are actively pursuing multiple life cycle patent applications for TELINTRA, including applications related to combination therapies, polymorphs, formulations, manufacturing processes and the genomic profiles of responders. We have been granted US and foreign patents for potent analogs of TELINTRA (expiry in 2026) and a US patent for the tablet formulation of TELINTRA (expiry in 2031). We have US and foreign patents pending on crystalline forms and polymorph form of TELINTRA (expiry in 2031); amorphous ansolvate form of TELINTRA (expiry in 2032); manufacturing process for TELINTRA crystalline form (expiry in 2031); dosing schedule and treatment methods for MDS with TELINTRA (expiry in 2031); the treatment of multiple myeloma with TELINTRA (expiry in 2032); and excipient compatibility with TELINTRA (expiry in 2032). One patent on treatment methods for MDS with TELINTRA was granted at the European Patent Office. Intention to grant has been received from the European Patent Office for a patent on dosing schedule and a patent on treatment methods for MDS with TELINTRA. We can generally apply for patent term extensions on the patents for TELINTRA when and if marketing approvals for these compounds are obtained in the relevant countries. In foreign countries, these extensions are available only if approval is obtained before the patent expires, but in the United States, extensions are available even if approval is obtained after the patent would expire normally through a system of interim extensions until approval.

We have US and foreign patents granted or pending on our pipeline drug development candidates TLK60404, TLK60357 and TLK60596. These patents will expire in 2029, 2030 and 2032 respectively. In addition, the primary patents that cover our TRAP drug discovery technology will expire in August, 2015.

Our success will also depend, in part, on our ability to operate without infringing the intellectual property rights of others. We cannot assure you that our activities will not infringe patents owned by others. To date, we have not received any communications with the owners of related patents alleging that our activities infringe their patents. However, if our product candidates, technologies or any products that we may develop are found to infringe patents issued to third parties, the manufacture, use and sale of any products that we may develop could be enjoined, and we could be required to pay substantial damages. In addition, we may be required to obtain licenses to patents or other proprietary rights of third parties. We cannot assure you that any licenses required under any such patents or proprietary rights would be made available on terms acceptable to us, if at all. Failure to obtain such licenses could negatively affect our business.

Others may have filed and in the future may file patent applications covering small molecules or therapeutic products that are similar to ours. We cannot assure you that our patent applications will have priority over patent applications filed by others. Any legal action against us or our collaborators claiming damages and seeking to enjoin commercial activities relating to the affected products and processes could, in addition to subjecting us to potential liability for damages, require us or our collaborators to obtain a license to continue to manufacture or market the affected products and processes. We cannot predict whether we, or our collaborators, would prevail in any of these actions or that any license required under any of these patents would be made available on commercially acceptable terms, if at all. We believe that there may be significant litigation in the industry regarding patent and other intellectual property rights. If we become involved in litigation, it could consume a substantial portion of our managerial and financial resources, and we may not be successful in any such litigation.

In addition, we could incur substantial costs and use of our key employees’ time and efforts in litigation if we are required to defend against patent suits brought by third parties or if we initiate these suits, and we cannot predict whether we would be able to prevail in any of these suits.

Furthermore, some of our patents and intellectual property rights are owned jointly by us and our collaborators. While there are legal and contractual restraints on the rights of these joint owners, they may use these patents and other intellectual property in ways that may harm our business. We may not be able to prevent this type of use.

We also rely on trade secrets to protect technology, including aspects of our TRAP technology, where we believe patent protection is not appropriate or obtainable. However, trade secrets are difficult to protect. While we require employees, academic collaborators and consultants to enter into confidentiality agreements, we may not be able to adequately protect our trade secrets or other proprietary information in the event of any unauthorized use or disclosure or the lawful development by others of such information. If the identity of specific proteins or other elements of our TRAP technology become known, our competitive advantage in drug discovery could be reduced.

Many of our collaborators and scientific advisors have publication and other rights to certain information and data gained from their collaborations and research with us. Any publication or other use could limit our ability to secure intellectual property rights or impair any competitive advantage that we may possess or realize by maintaining the confidentiality of that information or data.

If we are unable to enter into or maintain existing contracts with third parties to manufacture our product candidates or any products that we may develop in sufficient quantities and at an acceptable cost, clinical development of product candidates could be delayed and we may be unable to meet demand for any products that we may develop and lose potential revenue.

We do not currently operate manufacturing facilities for clinical or commercial production of our product candidates. We expect to continue to rely on third parties for the manufacture of our product candidates and any

products that we may develop. We currently lack the resources and capability to manufacture any of our product candidates on a clinical scale or any products that we may develop on a commercial scale. As a result, we will be dependent on corporate partners, licensees or other third parties for the manufacturing of clinical and commercial scale quantities of our product candidates and any products that we may develop. Our product candidates and any products that we may develop may be in competition with other product candidates and products for access to these manufacturing facilities. For this and other reasons, our collaborators or third parties may not be able to manufacture our product candidates and products in a cost effective or timely manner.

If manufacturing is not performed in a timely manner, if our suppliers fail to perform or if our relationships with our suppliers or manufacturers should terminate, our clinical trials could be delayed. We may not be able to enter into or maintain any necessary third-party manufacturing arrangements on acceptable terms, if at all. Our current dependence upon others for the manufacture of our product candidates and our anticipated dependence upon others for the manufacture of any products that we may develop may adversely affect our future profit margins and our ability to commercialize any products that we may develop on a timely and competitive basis.

Working capital constraints may force us to delay our efforts to develop certain product candidates in favor of developing others, which may prevent us from commercializing all product candidates as quickly as possible.

Because we have limited resources, and because research and development is an expensive process, we must regularly assess the most efficient allocation of our research and development budget. As a result, we have had to prioritize development candidates and may not be able to fully realize the value of some of our product candidates in a timely manner, as they will be delayed in reaching the market, if at all.

If product liability lawsuits are successfully brought against us, we may incur substantial liabilities and may be required to limit commercialization of our product candidates and any products that we may develop.

The testing and marketing of medical products entail an inherent risk of product liability. Although we are not aware of any historical or anticipated product liability claims or specific causes for concern, if we cannot successfully defend ourselves against product liability claims, we may incur substantial liabilities or be required to limit commercialization of our product candidates and any products that we may develop. In addition, product liability claims may also result in withdrawal of clinical trial volunteers, injury to our reputation and decreased demand for any products that we may commercialize. We currently carry product liability insurance that covers our clinical trials up to a $10.0 million annual aggregate limit, and the clinical trials added through the Merger currently carry up to a $5.0 million annual aggregate limit. We will need to increase the amount of coverage if and when we have a product that is commercially available. If we are unable to obtain sufficient product liability insurance at an acceptable cost, potential product liability claims could prevent or inhibit the commercialization of any products that we may develop, alone or with corporate partners.

Substantial future sales of our common stock by us or by our existing stockholders could cause our stock price to fall.

Additional equity financings or other share issuances by us, including shares issued in connection with strategic alliances and corporate partnering transactions, could adversely affect the market price of our common stock. Sales by existing stockholders of a large number of shares of our common stock in the public market or the perception that additional sales could occur could cause the market price of our common stock to drop. Substantially all of our outstanding shares of common stock were freely tradable and, in limited cases, subject to certain volume, notice and manner of sale restrictions under Rule 144 of the Securities Act of 1933.

If we do not progress in our programs as anticipated, our stock price could decrease.

For planning purposes, we estimate the timing of a variety of clinical, regulatory and other milestones, such as when a certain product candidate will enter clinical development, when a clinical trial will be completed or when an application for regulatory approval will be filed. Our estimates are based on present facts and a variety of assumptions. Many of the underlying assumptions are outside of our control. If milestones are not achieved when we estimated that they would be, investors could be disappointed, and our stock price may decrease.

Our stock price may be volatile, you may not be able to resell your shares at or above your purchase price.

Our stock prices and the market prices for securities of biotechnology companies in general have been highly volatile, with recent significant price and volume fluctuations, and may continue to be highly volatile in the future. For example, our stock price dropped by 71% on the day following the announcement in December 2006 that the preliminary top-line results of our first three Phase 3 trials did not meet primary end-points. During the six months ended June 30, 2014, our common stock traded between $1.19 and $2.06, and on June 30, 2014, our common stock closed at $1.45. The following factors, in addition to other risk factors described in this section, may have a significant impact on the market price of our common stock, some of which are beyond our control:

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developments regarding, or the results of, our clinical trials;

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announcements of technological innovations or new commercial products by our competitors or us;

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the issuance of equity or debt securities of the Company, or disclosure or announcements relating thereto;

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developments concerning proprietary rights, including patents;

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developments concerning our collaborations;

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publicity regarding actual or potential medical results relating to products under development by our competitors or us;

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regulatory developments in the United States and foreign countries;

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litigation;

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economic and other external factors or other disaster or crisis; or

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period-to-period fluctuations in our financial results.

We have been, and in the future may be, subject to securities class action lawsuits and shareholder derivative actions. These, and potential similar or related litigation, could result in substantial damages and may divert management’s time and attention from our business.

We have been, and may in the future be, the target of securities class actions or shareholder derivative claims. Any such actions or claims could result in substantial damages and may divert management’s time and attention from our business.

The rights of our common stockholders are limited by and subordinate to the rights of the holders of Series A-1 convertible preferred stock and Series B convertible preferred stock; these rights may have a negative effect on the value of shares of our common stock.

The holders of the Series A-1 convertible preferred stock and Series B convertible preferred stock have rights and preferences generally superior to those of the holders of common stock. The existence of these superior rights and preferences may have a negative effect on the value of shares of our common stock. These rights are more fully set forth in the Series A-1 certificate of designations and Series B certificate of designations, respectively, and include, but are not limited to:

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the right to receive a liquidation preference, prior to any distribution of our assets to the holders of our common stock, in an amount equal to $ 0.0377081186 per share for the Series A-1convertible preferred stock and $2.00 per share for the Series B convertible preferred stock, subject to adjustments, and all accrued and unpaid dividends;

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the right to convert into shares of our common stock at the conversion price set forth in the Series A-1 certificate of designations and Series B certificate of designations, respectively, which may be adjusted as set forth therein; and

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the right to receive dividends in arrears at a rate of 8% per annum in preference to the holders of our common stock and to receive dividends made to holders of our common stock on an as converted basis.

The holders of Series A-1 convertible preferred stock and Series B convertible preferred stock will have the right to block certain fundamental transactions as further described in the Series A-1 certificate of designations and Series B Preferred Stock certificate of designations, respectively; these holders may use this right to negotiate terms more favorable to the holders of the Series A-1 preferred stock and Series B preferred stock to the detriment of the holders of other classes of our capital stock or may prevent us from completing transactions favorable to us and the holders of our capital stock.

As further set forth in the Series A-1 certificate of designation, the holders of a majority of the issued and outstanding Series A-1 convertible preferred stock, Series B convertible preferred stock or Hudson Bay Opportunities Fund LP have the right to approve or block certain transactions, including transactions that:

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create or issue additional or other capital stock or securities exchangeable for or convertible or exercisable into capital stock pari passu with or senior to the Series A-1 convertible preferred stock or Series B convertible preferred stock;

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reclassify, alter or amend any of our existing securities that is pari passu with the Series A-1 preferred stock or Series B convertible preferred stock;

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change the authorized number of shares of our capital stock;

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create or issue debt securities;

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authorize or effect payment of dividends or distributions on our capital stock;

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authorize or effect change of control, dissolution or liquidation events;

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amend or repeal our certificate of incorporation or bylaws;

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amend, alter or repeal preferences, special rights or other powers of the Series A-1 convertible preferred stock or Series B convertible preferred stock;

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avoid the observance or performance of the terms of the Series A-1 or Series B certificates of designations; and

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effect any change in our principal business.

Hudson Bay and/or the Series A-1 convertible preferred stockholders and/or the Series B convertible preferred stockholders may have interests differing from or detrimental to other holders of our capital stock with respect to these fundamental transactions. Obtaining their consent may delay or limit our ability to enter into transactions that may be beneficial to the holders of our capital stock.

A limited public trading market may cause volatility in the price of our common stock

Our common stock is currently quoted on the OTCQB marketplace. Despite our appeal to the NASDAQ Listing Council as described above, there is no assurance that our stock will again be eligible for trading on the

NASDAQ Capital Market or any other national securities exchange in the near future. The quotation of our common stock on the OTCQB marketplace does not assure that a meaningful, consistent and liquid trading market currently exists, and in recent years such market has experienced extreme price and volume fluctuations that have particularly affected the market prices of many smaller companies like us. Our common stock is subject to this volatility. Sales of substantial amounts of common stock, or the perception that such sales might occur, could adversely affect prevailing market prices of our common stock and our stock price may decline substantially in a short time and our stockholders could suffer losses or be unable to liquidate their holdings.

The floating conversion price for our Series B convertible preferred stock may lead to significant shareholder dilution and a corresponding drop in the market price of our common stock.

As described above and in the Series B certificate of designations, our Series B convertible preferred stock is convertible into our common stock at a “floating” conversion price. Following the Adjustment Date (as defined in the Series B certificate of designations), this conversion price adjusts according to the market price of our common stock. If the market price of our common stock declines, the Series B convertible preferred stock will be convertible into a greater number of shares of common stock, which could have the effect of diluting the ownership interest of all other holders of common stock. If the market price of our common stock were to decline significantly, this dilution could be substantial. Furthermore, any such dilution may cause the market price of the common stock to decline further, resulting in additional dilution and a continued potential adverse effect on the common stock price thereafter and could result in an imbalance of supply and demand for our common stock and reduce its price. This series of events could lead to a repetitive cycle, further and successively driving the market price of our common stock downward. The further the market price of our common stock declines, the further the floating conversion price will fall and the greater the number of shares we will have to issue upon conversion. In addition to affecting the market price of our common stock and diluting the value of each share of common stock for existing shareholders, the floating conversion price and the effects that it may have may also make it more difficult for us to raise capital in the future, which could adversely affect our ability to operate or grow our business.

We may not be able to achieve secondary trading of our stock in certain states because our common stock is no longer nationally traded, which could subject our stockholders to significant restrictions and costs.

Because our common stock is no longer eligible for trading on Nasdaq or on a national securities exchange, our common stock is subject to the securities laws of the various states and jurisdictions of the United States in addition to federal securities law. While we may register our common stock or qualify for exemptions for our common stock in one of more states, if we fail to do so the investors in those states where we have not taken such steps may not be allowed to purchase our stock or those who presently hold our stock may not be able to resell their shares without substantial effort and expense. These restrictions and potential costs could be significant burdens on our stockholders.

Item 5.

Other Information.

Employment Agreements

As disclosed on our Current Report on Form 8-k filed with the SEC on July 9, 2014, we assumed MabVax’s obligations pursuant to its employment agreements with each of J. David Hansen, Gregory P. Hanson and Wolfgang W. Scholz, Ph.D. in connection with the Merger. These agreements are further described below and attached as exhibits to this Quarterly Report on Form 10-Q.

J. David Hansen Employment Agreement

The Hansen Employment Agreement has an initial term of 3 years, with an option to renew or extend the terms if notice is provided by either Mr. Hansen or MabVax at least 60 days prior to the end of the term. Under the terms of his agreement, Mr. Hansen is currently entitled to receive a base salary of $315,660.29. Mr. Hansen is also entitled to an annual bonus, based on certain performance-based objectives established by the Compensation Committee of the Board.

The Hansen Employment Agreement may be terminated upon death, disability, and with or without Cause (as defined by the Hansen Employment Agreement) by MabVax, with Good Reason (as defined in the Hansen Employment Agreement), with or without Cause and upon a Change in Control (as defined in the Employment Agreement), by Mr. Hansen or at either party’s election not to renew the employment agreement. In the event the Hansen Employment Agreement is terminated as a result of Mr. Hansen’s death, Mr. Hansen’s authorized representative shall be entitled to receive all Accrued Obligations (as defined in the employment agreement), full acceleration of vesting of all issued and outstanding stock options, benefits for up to one year, any unpaid annual bonus amounts and a pro rata bonus payment. In the event the Hansen Employment Agreement is terminated by MabVax for Disability or without Cause, by Mr. Hansen for Good Reason, non-renewal by MabVax or in connection with a Change in Control, Mr. Hansen would be entitled to receive all Accrued Obligations, full acceleration of vesting of all issued and outstanding stock options, unpaid bonus amounts, benefits for up to one year or until Mr. Hansen obtains coverage through subsequent employment (whichever is earlier) and severance payments equal to Mr. Hansen’s annual base salary payable in 12 equal monthly installments. In the event the employment agreement is terminated by Telik for Cause, without Good Reason by Mr. Hansen, or the parties elect not to renew the agreement, Mr. Hansen will be entitled to payment of any base salary earned but unpaid through the date of termination and any other payment or benefit to which he is entitled under the applicable terms of any applicable company arrangement during the 30 day period following the termination of the Hansen Employment Agreement.

Gregory P. Hanson Employment Agreement

The Hanson Employment Agreement has an initial term of 3 years, with an option to renew or extend the terms if notice is provided by either Mr. Hanson or MabVax at least 60 days prior to the end of the term. Under the terms of his agreement, Mr. Hanson is currently entitled to receive a base salary of $215,000. Mr. Hanson is also entitled to an annual bonus, based on certain performance-based objectives established by MabVax’s Chief Executive Officer. In addition, MabVax previously granted Mr. Hanson options to purchase up to 70,000 shares of MabVax common stock at $2.25 per share (options to purchase up to 155,630 shares of Telik common stock at an exercise price of $1.012 per share pursuant to the Merger Agreement) under the terms of the MabVax 2014 Employee, Director and Consultant Equity Incentive Plan which was assumed by Telik pursuant to the Merger Agreement.

The Hanson Employment Agreement may be terminated upon death, disability, and with or without Cause (as defined by the Hansen Employment Agreement) by MabVax, with Good Reason (as defined in the Hanson Employment Agreement), with or without Cause and upon a Change in Control (as defined in the Employment Agreement), by Mr. Hanson or at either party’s election not to renew the employment agreement. In the event the Hanson Employment Agreement is terminated as a result of Mr. Hanson’s death, Mr. Hanson’s authorized representative shall be entitled to receive all Accrued Obligations (as defined in the employment agreement), full acceleration of vesting of all issued and outstanding stock options, benefits for up to 1 year, any unpaid annual bonus amounts and a pro rata bonus payment. In the event the Hanson Employment Agreement is terminated by MabVax for Disability or without Cause, by Mr. Hanson for Good Reason, non-renewal by MabVax or in connection with a Change in Control, Mr. Hanson would be entitled to receive all Accrued Obligations, full acceleration of vesting of all issued and outstanding stock options, unpaid bonus amounts, benefits for up to one year or until Mr. Hanson obtains coverage through subsequent employment (whichever is earlier) and severance payments equal to Mr. Hanson’s annual base salary payable in 12 equal monthly installments. In the event the employment agreement is terminated by Telik for Cause, without Good Reason by Mr. Hanson, or the parties elect not to renew the agreement, Mr. Hanson will be entitled to payment of any base salary earned but unpaid through the date of termination and any other payment or benefit to which he is entitled under the applicable terms of any applicable company arrangement during the 30 day period following the termination of the Hanson Employment Agreement.

Wolfgang W. Scholz Ph.D. Employment Agreement

The Scholz Employment Agreement has an initial term of 3 years, with an option to renew or extend the terms if notice is provided by either Dr. Scholz or MabVax at least 60 days prior to the end of the term. Under the terms of his agreement, Dr. Scholz is currently entitled to receive a base salary of $213,803. Dr. Scholz is also entitled to an annual bonus, based on certain performance-based objectives established by MabVax.

The Scholz Employment Agreement may be terminated upon death, disability, and with or without Cause (as defined by the Scholz Employment Agreement) by MabVax, with Good Reason (as defined in the Scholz Employment Agreement), with or without Cause and upon a Change in Control (as defined in the Employment Agreement), by Mr. Scholz or at either party’s election not to renew the employment agreement. In the event the Scholz Employment Agreement is terminated as a result of Dr. Scholz’s death, Dr. Scholz’s authorized representative shall be entitled to receive all Accrued Obligations (as defined in the employment agreement), full acceleration of vesting of all issued and outstanding stock options, benefits for up to 1 year, any unpaid annual bonus amounts and a pro rata bonus payment. In the event the Scholz Employment Agreement is terminated by MabVax for Disability or without Cause, by Dr. Scholz for Good Reason, non-renewal by MabVax or in connection with a Change in Control, Dr. Scholz would be entitled to receive all Accrued Obligations, full acceleration of vesting of all issued and outstanding stock options, unpaid bonus amounts, benefits for up to one year or until Dr. Scholz obtains coverage through subsequent employment (whichever is earlier) and severance payments equal to Dr. Scholz’s annual base salary payable in 12 equal monthly installments. In the event the employment agreement is terminated by Telik for Cause, without Good Reason by Dr. Scholz, or the parties elect not to renew the agreement, Dr. Scholz will be entitled to payment of any base salary earned but unpaid through the date of termination and any other payment or benefit to which he is entitled under the applicable terms of any applicable company arrangement during the 30 day period following the termination of the Scholz Employment Agreement.

MabVax Common Stock Financing

Prior to the Merger, on July 8, 2014, MabVax issued shares of MabVax common stock for aggregate proceeds of approximately $3,000,000 in a private placement pursuant to Section 4(a)(2) and Regulation D of the Securities Act with certain institutional investors, or the MabVax Private Placement, pursuant to a Securities Purchase Agreement, dated July 3, 2014, by and among MabVax and certain institutional investors, or the MabVax Purchase Agreement. Pursuant to the MabVax Purchase Agreement, MabVax agreed to issue the purchasers participating in the MabVax Private Placement prior to the closing of the Merger with Telik additional “anti-dilution” shares of MabVax common stock, for no additional consideration should MabVax sell shares of its common stock in the future at a price lower than $2.54 per share prior to the first to occur of (x) December 31, 2015 and (y) the date on which MabVax raised an aggregate of $10,000,000. The number of additional shares would be calculated on a weighted average based on the price per share of equity securities sold by MabVax following the initial closing of the MabVax Private Placement and in no event would a purchaser be issued a number of additional shares of MabVax common stock in excess of 33% of the number of shares initially purchased by such purchaser. These shares of MabVax common stock issued in the MabVax Private Placement were converted into shares of our common stock in connection with the Merger. We also assumed MabVax’s obligations with respect to the anti-dilution provisions in the Merger so that these provisions now apply to sales of our common stock. The full text of the MabVax Purchase Agreement for the MabVax Private Placement is attached as Exhibit 10.12 to this Quarterly Report on Form 10-Q.

Item 6. Exhibits.


2.1		Agreement and Plan of Merger and Reorganization, dated May 12, 2014, between Telik, Tacoma Acquisition Corp., Inc. and MabVax. (1)

2.2		Amendment No. 1, dated as of June 30, 2014, by and between Telik and MabVax. (2)

2.3		Amendment No. 2, dated as of July 7, 2014, by and between Telik and MabVax. (3)

3.1		Amended and Restated Certificate of Incorporation. (4)

3.2		Certificate of Amendment to Amended and Restated Certificate of Incorporation. (5)

3.3		Certificate of Designations, Preferences and Rights of Series B Convertible Preferred Stock of Telik, Inc. (6)

3.4		Certificate of Designations, Preferences and Rights of Series A-1 Convertible Preferred Stock (7)

3.5		Amended and Restated Bylaws. (8)

4.1		Specimen Stock Certificate. (9)

4.2		Form of Common Stock Warrant and Warrant Certificate. (10)

4.3		Form of Common Stock Warrant (11)

4.4		Form of Warrant to Purchase Common Stock (12)

10.1		Securities Purchase Agreement, dated May 12, 2014, between Telik and the investors identified on the Schedule of Buyers therein. (13)

10.2		Registration Rights Agreement, dated as of February 12, 2014, between MabVax and the persons and entities identified on the signature pages thereto. (14)

10.3		Securities Purchase Agreement, dated as of February 12, 2014, between MabVax and the purchasers set forth on the signature pages thereto including that certain Amendment No. 1 to Securities Purchase Agreement, dated as of May 12, 2014, between MabVax and the persons and entities identified on the signature pages thereto. (15)

10.4		Separation Agreement and Release, dated May 12, 2014, between Michael M. Wick and Telik. (16)

10.5		Separation Agreement and Release, dated May 12, 2014, between William P. Kaplan and Telik. (17)

10.6		Separation Agreement and Release, dated May 12, 2014, between Steven R. Schow and Telik. (18)

10.7		Separation Agreement and Release, dated May 12, 2014, between Wendy K. Wee and Telik. (19)

10.8		Omnibus Amendment and Stockholder Consent, dated July 7, 2014, by and among Telik and the Purchasers. (20)

10.9		Employment Agreement, dated July 8, 2014, by and between MabVax and J. David Hansen.

10.10		Employment Agreement, dated July 8, 2014, by and between MabVax and Gregory P. Hanson.

10.11		Employment Agreement, dated July 8, 2014, by and between MabVax and Wolfgang W. Scholz, Ph.D.

10.12		Securities Purchase Agreement, dated July 8, 2014, by and between MabVax and certain institutional investors set forth therein.

10.13		Michael Wick Resignation Letter, dated July 7, 2014. (21)

10.14		Edward W. Cantrall Resignation Letter, dated July 7, 2014. (22)

10.15		Steven R. Goldring Resignation Letter, dated July 7, 2014. (23)



10.16		Richard B. Newman Resignation Letter, dated July 7, 2014. (24)

31.1		Certification required by Rule 13a-14(a) or Rule 15d-14(a).

31.2		Certification required by Rule 13a-14(a) or Rule 15d-14(a).

32.1		Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350).

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Document

101.DEF		XBRL Taxonomy Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Labels Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

(1)	Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(2)	Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, as filed on July 1, 2014 (File No. 000-31265).

(3)	Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(4)	Incorporated by reference to Exhibit 3.1 to our Annual Report on Form 10-K for the year ended December 31, 2001, as filed on March 27, 2002 (File No. 000-31265).

(5)	Incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K dated March 28, 2012, as filed on March 30, 2012 (File No. 000-31265).

(6)	Incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(7)	Incorporated by reference to Exhibit A to Exhibit 2.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(8)	Incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K dated December 11, 2007, as filed on December 14, 2007 (File No. 000-31265).

(9)	Incorporated by reference to Exhibit 4.1 to our Registration Statement on Form S-1A filed on July 3, 2000 (File No. 333-33868).

(10)	Incorporated by reference to Exhibit 4.8 to our Registration Statement on Form S-3, as filed on August 8, 2011 (File No. 333-176121).

(11)	Incorporated by reference to Exhibit B to Exhibit 2.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(12)	Incorporated by reference to Exhibit 4.2 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(13)	Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(14)	Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(15)	Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(16)	Incorporated by reference to Exhibit 10.4 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(17)	Incorporated by reference to Exhibit 10.5 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(18)	Incorporated by reference to Exhibit 10.6 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(19)	Incorporated by reference to Exhibit 10.7 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(20)	Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(21)	Incorporated by reference to Exhibit 99.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(22)	Incorporated by reference to Exhibit 99.2 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(23)	Incorporated by reference to Exhibit 99.3 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(24)	Incorporated by reference to Exhibit 99.4 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

TELIK, INC.

/s/ GREGORY P. HANSON

Gregory P. Hanson

Chief Financial Officer

(Principal Financial and Accounting Officer)

Date: August 8, 2014

E XHIBIT I NDEX


2.1		Agreement and Plan of Merger and Reorganization, dated May 12, 2014, between Telik, Tacoma Acquisition Corp., Inc. and MabVax. (1)

2.2		Amendment No. 1, dated as of June 30, 2014, by and between Telik and MabVax. (2)

2.3		Amendment No. 2, dated as of July 7, 2014, by and between Telik and MabVax. (3)

3.1		Amended and Restated Certificate of Incorporation. (4)

3.2		Certificate of Amendment to Amended and Restated Certificate of Incorporation. (5)

3.3		Certificate of Designations, Preferences and Rights of Series B Convertible Preferred Stock of Telik, Inc. (6)

3.4		Certificate of Designations, Preferences and Rights of Series A-1 Convertible Preferred Stock (7)

3.5		Amended and Restated Bylaws. (8)

4.1		Specimen Stock Certificate. (9)

4.2		Form of Common Stock Warrant and Warrant Certificate. (10)

4.3		Form of Common Stock Warrant (11)

4.4		Form of Warrant to Purchase Common Stock (12)

10.1		Securities Purchase Agreement, dated May 12, 2014, between Telik and the investors identified on the Schedule of Buyers therein. (13)

10.2		Registration Rights Agreement, dated as of February 12, 2014, between MabVax and the persons and entities identified on the signature pages thereto. (14)

10.3		Securities Purchase Agreement, dated as of February 12, 2014, between MabVax and the purchasers set forth on the signature pages thereto including that certain Amendment No. 1 to Securities Purchase Agreement, dated as of May 12, 2014, between MabVax and the persons and entities identified on the signature pages thereto. (15)

10.4		Separation Agreement and Release, dated May 12, 2014, between Michael M. Wick and Telik. (16)

10.5		Separation Agreement and Release, dated May 12, 2014, between William P. Kaplan and Telik. (17)

10.6		Separation Agreement and Release, dated May 12, 2014, between Steven R. Schow and Telik. (18)

10.7		Separation Agreement and Release, dated May 12, 2014, between Wendy K. Wee and Telik. (19)

10.8		Omnibus Amendment and Stockholder Consent, dated July 7, 2014, by and among Telik and the Purchasers. (20)

10.9		Employment Agreement, dated July 8, 2014, by and between MabVax and J. David Hansen.

10.10		Employment Agreement, dated July 8, 2014, by and between MabVax and Gregory P. Hanson.

10.11		Employment Agreement, dated July 8, 2014, by and between MabVax and Wolfgang W. Scholz, Ph.D.

10.12		Securities Purchase Agreement, dated July 8, 2014, by and between MabVax and certain institutional investors set forth therein.



10.13		Michael Wick Resignation Letter, dated July 7, 2014. (21)

10.14		Edward W. Cantrall Resignation Letter, dated July 7, 2014. (22)

10.15		Steven R. Goldring Resignation Letter, dated July 7, 2014. (23)

10.16		Richard B. Newman Resignation Letter, dated July 7, 2014. (24)

31.1		Certification required by Rule 13a-14(a) or Rule 15d-14(a).

31.2		Certification required by Rule 13a-14(a) or Rule 15d-14(a).

32.1		Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350).

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Document

101.DEF		XBRL Taxonomy Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Labels Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

(1)	Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(2)	Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, as filed on July 1, 2014 (File No. 000-31265).

(3)	Incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(4)	Incorporated by reference to Exhibit 3.1 to our Annual Report on Form 10-K for the year ended December 31, 2001, as filed on March 27, 2002 (File No. 000-31265).

(5)	Incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K dated March 28, 2012, as filed on March 30, 2012 (File No. 000-31265).

(6)	Incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(7)	Incorporated by reference to Exhibit A to Exhibit 2.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(8)	Incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K dated December 11, 2007, as filed on December 14, 2007 (File No. 000-31265).

(9)	Incorporated by reference to Exhibit 4.1 to our Registration Statement on Form S-1A filed on July 3, 2000 (File No. 333-33868).

(10)	Incorporated by reference to Exhibit 4.8 to our Registration Statement on Form S-3, as filed on August 8, 2011 (File No. 333-176121).

(11)	Incorporated by reference to Exhibit B to Exhibit 2.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(12)	Incorporated by reference to Exhibit 4.2 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(13)	Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(14)	Incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(15)	Incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(16)	Incorporated by reference to Exhibit 10.4 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(17)	Incorporated by reference to Exhibit 10.5 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(18)	Incorporated by reference to Exhibit 10.6 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(19)	Incorporated by reference to Exhibit 10.7 to our Current Report on Form 8-K, as filed on May 12, 2014 (File No. 000-31265).

(20)	Incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(21)	Incorporated by reference to Exhibit 99.1 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(22)	Incorporated by reference to Exhibit 99.2 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(23)	Incorporated by reference to Exhibit 99.3 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

(24)	Incorporated by reference to Exhibit 99.4 to our Current Report on Form 8-K, as filed on July 9, 2014 (File No. 000-31265).

Exhibit 10.9

EMPLOYMENT AGREEMENT

This Employment Agreement (“ Agreement ”) is made as of July 1, 2014, between MabVax Therapeutics, Inc. (the “ Company ”), and David Hansen (the “ Executive ”).

WHEREAS, the Company and the Executive previously entered into an Employment Agreement dated as of September 2, 2011 (the “Prior Employment Agreement”); and

WHEREAS, the Company desires to retain and employ the Executive and the Executive desires to be retained and employed by the Company on the terms contained in this Agreement, which shall supersede the Prior Employment Agreement as of the effective date above.

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

1. Position and Duties .

(a) The Executive shall serve as the Company’s President, CEO, and Chairman of the Board of Directors of the Company reporting to the Company’s Board of Directors (the “Board”).

(b) The Executive shall perform those services customary to this office and such other lawful duties that the Board may be reasonably assign to him. The Executive shall devote all of his business time and best efforts to the performance of his duties under this Agreement and shall be subject to, and shall comply with the Company policies, practices and procedures and all codes of ethics or business conduct applicable to his position, as in effect from time to time. Notwithstanding the foregoing, the Executive shall be entitled to (i) serve as a member of the board of directors of a reasonable number of other companies, subject to the advance approval of the Board, which approval shall not be unreasonably withheld, (ii) serve on civic, charitable, educational, religious, public interest or public service boards, subject to the advance approval of the Board, which approval shall not be unreasonably withheld, and (iii) manage the Executive’s personal and family investments, in each case, to the extent such activities do not materially interfere, as determined by the Board in good faith, with the performance of the Executive’s duties and responsibilities hereunder.

2. Term . This Agreement and the Executive’s employment pursuant to this Agreement shall be for a term of three (3) years commencing as of July 1, 2014 (the “Effective Date”) and ending on the third anniversary of the Effective Date (the “Expiration Date”), unless terminated earlier by the Company or the Executive pursuant to Section 4 of this Agreement (the “Term”). In the event either party wishes to renew or extend this Agreement upon the Expiration Date, such party shall notify the other in writing at least 60 days prior to the Expiration Date.

3. Compensation and Related Matters .

(a) Base Salary . During the Term, the Executive’s annual base salary shall be $315,660.29 (the “Base Salary”). The Base Salary shall be payable in accordance with the Company’s normal payroll procedures in effect from time to time and may be increased, but not decreased, at the discretion of the Board or the Compensation Committee of the Board.

(b) Annual Bonus . During the Term, the Executive shall be entitled to receive a bonus (the “Annual Bonus”) for each calendar year, payable in cash in accordance with, and subject to the terms and conditions of, the Company’s then applicable short-term bonus or other cash incentive program (each, a “Bonus Program”). The Executive’s aggregate target bonus award for each calendar year will be 100% of his then Base Salary (the “Target Annual Bonus”). The Executive’s actual Annual Bonus may range from a minimum amount of 0% to a maximum of 100% of his Target Annual Bonus, which will be determined by the Compensation Committee of the Board and will be contingent upon the attainment of performance goals reasonably established in good faith by the Committee based upon the recommendations of the Executive no later than 90 days after the commencement of each calendar year. Any Annual Bonus compensation payable to the Executive shall be payable by March 15 of the calendar year following the calendar year to which such Annual Bonus relates, subject to the condition that the Executive remain employed by the Company through the date the Annual Bonus is paid, except as set forth in Section 6 herein.

(c) Business Expenses . During the Term, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by him in performing services hereunder, in accordance with the policies and procedures then in effect and established by the Company for its senior executive officers.

(d) Other Benefits . During the Term and subject to any contribution therefor required of employees of the Company, the Executive shall be entitled to participate in all equity, pension, savings and retirement plans, welfare and insurance plans, practices, policies, programs and perquisites of employment applicable generally to other senior executives of the Company, except to the extent any employee benefit plan provides for benefits otherwise provided to the Executive hereunder (e.g., annual bonuses and severance). Such participation shall be subject to (i) requirements of applicable law, (ii) the terms of the applicable plan documents, (iii) generally applicable Company policies, and (iv) the discretion of the Board or any administrative or other committee provided for under or contemplated by such plan. The Executive shall have no recourse against the Company under this Agreement in the event that the Company should alter, modify, add to or eliminate any or all of its employee benefit plans.

(e) Vacation; Holidays . During the Term, the Executive shall be entitled to take up to 30 days of paid time off per calendar year, to be taken in accordance with the policies applicable to senior executives of the Company generally. The Executive shall also be entitled to paid holidays in accordance with the policies applicable to senior executives of the Company generally.

-2-

4. Termination . The Executive’s employment may be terminated prior to the expiration of the Term hereof and this Agreement may be terminated under the following circumstances:

(a) Death . The Executive’s employment shall terminate upon his death.

(b) Disability . The Company may terminate the Executive’s employment if the Executive becomes subject to a Disability. For purposes of this Agreement, “Disability” means the Executive is unable to perform the essential functions of his position, with or without a reasonable accommodation, for a period of 90 consecutive calendar days or 180 non-consecutive calendar days within any rolling 12 month period.

(c) Termination by Company for Cause . The Company may terminate the Executive’s employment for Cause. For purposes of this Agreement, “Cause” means (i) the Executive’s conviction of a felony or a crime of moral turpitude; (ii) the Executive’s commission of unauthorized acts intended to result in the Executive’s personal enrichment at the material expense of the Company; or (iii) the Executive’s material violation of the Executive’s duties or responsibilities to the Company which constitute willful misconduct or dereliction of duty, provided as to any termination pursuant to subsection (iii), a majority of the members of the Board shall first approve such “Cause” termination before the Company effectuates such termination of employment.

(d) Termination by the Company without Cause . The Company may terminate the Executive’s employment at any time without Cause upon 30 days prior written notice.

(e) Termination by the Executive . The Executive may terminate his employment at any time for any reason other than a Good Reason, upon 30 days prior written notice.

(f) Termination by the Executive for Good Reason . The Executive may terminate his employment for Good Reason. For purposes of this Agreement, “Good Reason” means the existence of any one or more of the following conditions without the Executive’s consent, provided Executive submit written notice to the Compensation Committee of the Board within 45 days such condition(s) first arose specifying the condition(s): (i) a material change in or reduction of the Executive’s authority, duties and responsibilities, or the assignment to the Executive of duties materially inconsistent with the Executive’s position with the Company; (ii) the requirement that the Executive report to any person, executive or board of directors other than the Board as presently constituted; (iii) a material reduction in the Executive’s then current Base Salary or Target Annual Bonus opportunity; or (iv) the requirement that Executive relocate to an office location more than fifty (50) miles from the San Diego, California area. The Executive’s continued employment subsequent to an event that may constitute Good Reason shall not be deemed to be a waiver of his rights under this provision. Upon receipt of written notice from the Executive regarding a condition constituting Good Reason, the Company shall then have 30 days to correct the condition (the “Cure Period”). If such condition is not corrected by the last day of the Cure Period, the Executive’s resignation for Good Reason shall become effective on the 31st day following the written notice.

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(g) Termination in connection with a Change in Control . In the event of a Change in Control of the Company (as such term is defined in the Company’s 2014 Employee, Director and Consultant Equity Incentive Plan), for a period of sixty (60) days after the effective date of such Change in Control, Executive shall be entitled to resign employment with the Company. This subsection shall also prohibit the termination of Executive’s employment without Cause once the Company enters into a letter of intent relating to a transaction that would result in a Change in Control.

(h) Expiration . Executive’s employment shall terminate on the Expiration Date unless renewed or extended pursuant to Section 2.

(i) Termination Date . The “Termination Date” means: (i) if the Executive’s employment is terminated by his death under Section 4(a), the date of his death; (ii) if the Executive’s employment is terminated on account of his Disability under Section 4(b), the date on which the Company provides the Executive a written termination notice; (iii) if the Company terminates the Executive’s employment for Cause under Section 4(c), the date on which the Company provides the Executive a written termination notice; (iv) if the Company terminates the Executive’s employment without Cause under Section 4(d), 30 days after the date on which the Company provides the Executive a written termination notice; (v) if the Executive resigns his employment without Good Reason under Section 4(e), 30 days after the date on which the Executive provides the Company a written termination notice, (vii) if the Executive resigns his employment with Good Reason under Section 4(f), the 31st day following the day the Executive provides the Company with written notice of the conditions constituting same, if the Company has not cured such conditions by the 30th day; (viii) if the Executive provides the Company with written notice of his termination in connection with a Change in Control pursuant to Section 4(g), the 31 ^st day following such written notice; and (ix) the Expiration Date if the Executive’s employment terminates under Section 4(h).

5. Compensation upon Termination .

(a) Termination by the Company for Cause or by the Executive without Good Reason . If the Executive’s employment with the Company is terminated pursuant to Sections 4(c) or (e), the Company shall pay or provide to the Executive the following amounts through the Termination Date: any earned but unpaid Base Salary, unpaid expense reimbursements, and any vested benefits the Executive may have under any employee benefit plan of the Company (the “Accrued Obligations”) on or before the time required by law but in no event more than 30 days after the Executive’s Termination Date.

(b) Death . If, prior to the expiration of the Term, the Executive’s employment terminates because of his death as provided in Section 4(a), then the Executive’s authorized representative or estate shall be entitled to the following subject to Section 6:

(i) Accrued Obligations . The Company shall pay the Accrued Obligations earned through the Termination Date (payable at the time provided for in Section 5(a)).

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(ii) Unpaid Annual Bonus . The Company shall pay the Annual Bonus awarded for the calendar year preceding the Termination Date that remains unpaid as of the Termination Date (payable at the time provided for in Section 3(b)).

(iii) Pro-Rata Bonus . The Company shall pay a pro-rata portion of the Executive’s Annual Bonus for the calendar year in which the Executive’s termination occurs based on the actual achievement of performance criteria for that year (determined by multiplying the amount of the Annual Bonus which would be due for the full calendar year by a fraction, the numerator of which is the number of days during the calendar year of termination that the Executive is employed by the Company and the denominator of which is 365) (the “Pro-Rata Bonus”) payable in accordance with Section 6.

(iv) Vesting Acceleration . The Company shall vest in full the Executive on the Termination Date for any and all outstanding equity-incentive awards issued to the Executive and any options may be exercised by his authorized representative or estate for a period equal to the earlier of one year from and after the Termination Date and the original expiration date of each option as set forth in the respective grant agreements unless a longer period of time is set forth in the grant agreement evidencing the options.

(v) Continuation of Benefits . Subject to the Executive’s eligible dependents’ timely election of continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“ COBRA ”), the Company shall continue to contribute to the premium cost of the Executive’s participation and that of his eligible dependents’ in the Company’s group health plan (to the extent permitted under applicable law and the terms of such plan) which covers the Executive (and the Executive’s eligible dependents) for a period of twelve (12) months, provided the Executive pay the remainder of the premium cost of such participation by payroll deduction (if any) and, provided further that the Executive is eligible and remains eligible for COBRA coverage. If the reimbursement of any COBRA premiums would violate the nondiscrimination rules or cause the reimbursement of claims to be taxable under the Patient Protection and Affordable Care Act of 2010, together with the Health Care and Education Reconciliation Act of 2010 (collectively, the “ Act ”) or Section 105(h) of the Code, the Company paid premiums shall be treated as taxable payments and be subject to imputed income tax treatment to the extent, necessary to eliminate any discriminatory treatment or taxation under the Act or Section 105(h) of the Code. If the Executive’s participation or that of his eligible dependents’ participation would give rise to penalties or taxes against the Company under the Act, as determined by the Company in its sole discretion, the Company shall instead make cash payments to the Executive over the same period in monthly installments in an amount equal to the Company’s portion of the monthly cost of providing such benefits under its group health plan for such period.

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Section 4(f), the Executive terminates his employment in connection with a Change in Control pursuant to Section 4(g), or for the expiration of the Term pursuant to Section 4(h) because the Company fails to renew the Agreement pursuant to Section 2, then the Executive shall be entitled to the following subject to Section 6:

(i) The Company shall pay and provide the Executive with the benefits set forth in 5(b) (i) (Accrued Obligations), 5(b)(ii) (Unpaid Bonus), 5(b)(iii) (Pro-Rata Bonus), 5(b)(iv) (Vesting Acceleration), and the continuation of benefits for 12 months as set forth in Section 5(b)(v) (Continuation of Benefits) provided that if Executive obtains other employment that offers group health benefits, such continued coverage by the Company under subsection (b)(v) (Continuation of Benefits) shall cease as of such coverage date; and

(ii) The Company shall pay the Executive severance in an amount equal to one times the Base Salary at the rate in effect on the Termination Date (but without giving effect to any reduction if one or all of the bases for the Executive’s resignation for Good Reason is a reduction in Base Salary) less, in the case of termination by the Company for Disability, the gross proceeds paid to the Executive on account of Social Security or other similar benefits and Company-provided short-term and long-term disability plans, if any, which shall be payable in twelve (12) equal monthly installments commencing as set forth in Section 6.

6. Mutual Release; Payment . The payments and benefits provided for in Section 5 shall be conditioned on (a) the Executive’s continued compliance with the obligations of the Executive under Sections 9 and 10 and (b) the Executive or, in the event of his death, his estate, executing and delivering to the Company a full mutual release of all claims that the Executive, his heirs and assigns may have against the Company, its affiliates and subsidiaries and each of their respective directors, officers, employees and agents, and of all claims that the Company shall have against the Executive, his heirs and assigns, in a form reasonably acceptable to the Company and the Executive (the “ Release ”). The Release must become enforceable and irrevocable on or before the sixtieth (60th) day following the Termination Date. If the Executive (or his estate) fails to execute without revocation the Release, he shall be entitled to the Accrued Obligations only and no other benefits. The installments of severance provided under Section 5(c)(ii) shall commence in the calendar month following the month in which the Release becomes enforceable and irrevocable. If, however, the sixty (60) day period in which the Release must become enforceable and irrevocable begins in one year and ends in the following year, the Company shall commence payment of the severance installments in the second year in the later of January and the first calendar month following the month in which the Release becomes effective and irrevocable. The first installment shall include, however, all amounts that would otherwise have been paid to the Executive between the Termination Date and the Executive’s receipt of the first installment, assuming the first installment would otherwise have been paid in the month following the month in which the Termination Date occurs. The Pro-Rata Bonus payable in Section 5 shall be paid when annual bonuses are paid to other senior executives of the Company generally, but in no event later than March 15 of the year following the year in which the Termination Date occurs.

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7. Section 409A Compliance .

(a) All in-kind benefits provided and expenses eligible for reimbursement under this Agreement shall be provided by the Company or incurred by the Executive during the time periods set forth in this Agreement. All reimbursements shall be paid as soon as administratively practicable, but in no event shall any reimbursement be paid after the last day of the taxable year following the taxable year in which the expense was incurred. The amount of in-kind benefits provided or reimbursable expenses incurred in one taxable year shall not affect the in-kind benefits to be provided or the expenses eligible for reimbursement in any other taxable year. Such right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.

(b) To the extent that any of the payments or benefits provided for in Section 5 are deemed to constitute non-qualified deferred compensation benefits subject to Section 409A of the United States Internal Revenue Code (the “Code”), the following interpretations apply to Section 5:

(i) Any termination of the Executive’s employment triggering payment of benefits under Section 5 must constitute a “separation from service” under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. § 1.409A-l(h) before distribution of such benefits can commence. To the extent that the termination of the Executive’s employment does not constitute a separation of service under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A- 1(h) (as the result of further services that are reasonably anticipated to be provided by the Executive to the Company or any of its parents, subsidiaries or affiliates at the time the Executive’s employment terminates), any benefits payable under Section 5(b) or (c) that constitute deferred compensation under Section 409A of the Code shall be delayed until after the date of a subsequent event constituting a separation of service under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h). For purposes of clarification, this Section 7(b)(i) shall not cause any forfeiture of benefits on the Executive’s part, but shall only act as a delay until such time as a “separation from service” occurs.

(ii) Because the Executive is a “specified employee” (as that term is used in Section 409A of the Code and regulations and other guidance issued thereunder) on the date his separation from service becomes effective, any benefits payable under Section 5(b) or (c) that constitute non-qualified deferred compensation under Section 409A of the Code shall be delayed until the earlier of (A) the business day following the six-month anniversary of the date his separation from service becomes effective, and (B) the date of the Executive’s death, but only to the extent necessary to avoid such penalties under Section 409A of the Code. On the earlier of (A) the business day following the six-month anniversary of the date his separation from service becomes effective, and (B) the Executive’s death, the Company shall pay the Executive in a lump sum the aggregate value of the non-qualified deferred compensation that the Company otherwise would have paid the Executive prior to that date under Section 5 of this Agreement.

(iii) It is intended that each installment of the payments and benefits provided under Section 5 of this Agreement shall be treated as a separate “payment” for

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purposes of Section 409A of the Code. In particular, the installment severance payments set forth in Section 7(b)(ii) of this Agreement shall be divided into two portions. That number of installments commencing on the first payment date set forth in Section 7 of this Agreement that are in the aggregate less than two times the applicable compensation limit under Section 401(a)(17) of the Code for the year in which the Termination Date occurs (provided the termination of the Executive’s employment is also a separation from service) shall be payable in accordance with Treas. Reg. § 1.409A-l(b)(9)(iii) as an involuntary separation plan. The remainder of the installments shall be paid in accordance with Sections 7(b)(i) and (ii) above.

8. Certain Reductions in Payments .

(a) Anything in this Agreement to the contrary notwithstanding, in the event that the Accounting Firm (as defined below) determines that receipt of all Payments (as defined below) would subject the Executive to the tax under Section 4999 of the Code, the Accounting Firm shall determine whether to reduce any of the Agreement Payments (as defined below) to the Executive so that the Parachute Value (as defined below) of all Payments to the Executive, in the aggregate, equals the applicable Safe Harbor Amount (as defined below). Agreement Payments shall be so reduced (the “Reduced Payments”) only if the Accounting Firm determines that the Executive would have a greater Net After-Tax Receipt (as defined below) of aggregate Payments if the Agreement Payments were so reduced. If the Accounting Firm determines that the Executive would not have a greater Net After-Tax Receipt of aggregate Payments if the Agreement Payments were so reduced, the Executive shall receive all Agreement Payments to which the Executive is entitled hereunder.

(b) If the Accounting Firm determines that the aggregate Agreement Payments to the Executive should be reduced so that the Parachute Value of all Payments to the Executive, in the aggregate, equals the applicable Safe Harbor Amount, the Company shall promptly give the Executive notice to that effect and a copy of the detailed calculation thereof. All determinations made by the Accounting Firm under this Section 8 shall be binding upon the Company and the Executive and shall be made as soon as reasonably practicable and in no event later than 15 days following the date that there has been an Agreement Payment that would subject the Executive to the tax under Section 4999 of the Code (the “Excise Tax”).

(c) For purposes of reducing the Agreement Payments to the Executive so that the Parachute Value of all Payments to the Executive, in the aggregate, equals the applicable Safe Harbor Amount, only Agreement Payments (and no other Payments) shall be reduced. The reduction contemplated by this Section 8, if applicable, shall be made by reducing payments and benefits (to the extent such amounts are considered Payments) under the following sections in the following order: (i) any Payments under Section 5(b)(v) (Continuation of Benefits), (ii) any Payments under Section 5(b)(iii) (Pro-Rata Bonus), (iii) any Payments under Section 5(b)(ii) (Unpaid Bonus), (iv) any Payments under Section 5(b)(iv) (Acceleration of Vesting), and (iv) any other cash Agreement Payments that would be made upon a termination of the Executive’s employment, beginning with payments that would be made last in time.

(d) 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

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that, under circumstances where the initial determination resulted in Reduced Payments, the Internal Revenue Service may later determine such reduction was not large enough to avoid the Excise Tax on the Payments (making the Net After-Tax Receipt of aggregate Payments less than if no reduction had occurred). Under such circumstances, in the event that the Internal Revenue Service or a court, as applicable, finally and in a decision that has become unappealable or a decision which is nonfinal but which the Company elects not to appeal, determines that the Payments are subject to the Excise Tax, the amount of the Reduced Payments shall be paid or distributed by the Company to or for the benefit of the Executive within 30 days of such final determination; provided that (i) the Executive shall not initiate any proceeding or other contests regarding these matters, other than at the direction of the Company, and shall provide notice to the Company of any proceeding or other contest regarding these matters initiated by the Internal Revenue Service and (ii) the Company shall be entitled to direct and control all such proceedings and other contests, if it commits to do so, it shall pay all fees (including without limitation legal and other professional fees) associated therewith.

(e) In connection with making determinations under this Section 8, the Accounting Firm shall take into account the value of any reasonable compensation for services to be rendered by the Executive before or after the change in control, including the non-competition provisions applicable to the Executive under Section 9(d) and any other non-competition provisions that may apply to the Executive, and the Company shall cooperate in the valuation of any such services, including any non-competition provisions.

(f) All fees and expenses of the Accounting Firm in implementing the provisions of this Section 8 shall be borne by the Company.

(g) In the event of any controversy with the Internal Revenue Service (or other taxing authority) with regard to the Agreement Payments, the Executive shall permit the Company to control issues related to the Agreement Payments or any excise tax thereon, provided that such issues do not potentially materially adversely affect the Executive. If the Company commits to control such issues, it shall pay all fees (including without limitation legal and other professional fees) associated therewith. In the event of any conference with any taxing authority as to the Agreement Payments, any excise tax thereon, or associated income taxes, the Executive shall permit the representative of the Company to accompany the Executive, and the Executive and any representative of the Executive shall cooperate with the Company and its representative.

(h) Definitions . The following terms shall have the following meanings for purposes of this Section 8.

(i) “Accounting Firm” shall mean a nationally recognized certified public accounting firm or other professional organization that is a certified public accounting firm recognized as an expert in determinations and calculations for purposes of Section 280G of the Code that is selected by the Executive and reasonably acceptable to the Company for purposes of making the applicable determinations hereunder.

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(ii) “Agreement Payment” shall mean a Payment paid or payable pursuant to this Agreement including, for the avoidance of doubt, any acceleration of vesting of equity awards.

(iii) “Net After-Tax Receipt” shall mean the Present Value of a Payment net of all taxes imposed on the Executive with respect thereto under Code Sections 1 and 4999 and under applicable state, local, and foreign laws, determined by applying the applicable highest marginal rate .

(iv) “Parachute Value” of a Payment shall mean the present value as of the date of the change in control for purposes of Code Section 280G of the portion of such Payment that constitutes a “parachute payment” under Code Section 280G(b)(2), as determined by the Accounting Firm for purposes of determining whether and to what extent the excise tax under Code Section 4999 will apply to such Payment.

(v) A “Payment” shall mean any payment or distribution in the nature of compensation (within the meaning of Code Section 280G(b)(2)) to or for the benefit of the Executive, whether paid or payable pursuant to this Agreement or otherwise.

(vi) “Present Value” of a Payment shall mean the economic present value of a Payment as of the date of the change in control for purposes of Code Section 280G, as determined by the Accounting Firm using the discount rate required by Code Section 280G(d)(4).

(vii) “Safe Harbor Amount” means (x) 3.0 times the Executive’s “base amount,” within the meaning of Code Section 280G(b)(3), minus (y) $1.00.

9. Confidentiality and Restrictive Covenants .

(a) The Executive acknowledges that:

(i) the Company (which, for purposes of this Section 9 shall include the Company and each of its subsidiaries and affiliates) is engaged in the pharmaceutical development business with a focus on the development and testing of monovalent and polyvalent vaccines targeted at cancer for eventual commercialization (the “Business”);

(ii) the Company is dependent on the efforts of a certain limited number of persons who have developed, or will be responsible for developing the Company’s Business;

(iii) the Company’s Business is national in scope;

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budgets, forecasts, profit or loss figures, distributors and distribution strategies, pricing strategies, improvements, sales figures, contracts, agreements, then existing or then prospective suppliers and sources of supply and customer lists, undertakings with or with respect to the Company’s customers or prospective customers, and patient information, product development plans, rules and regulations, personnel information and trade secrets of the Company, all of which are of vital importance to the success of the Company’s business (collectively, “Confidential Information”);

(v) the direct or indirect disclosure of any Confidential Information would place the Company at a serious competitive disadvantage and would do serious damage, financial and otherwise, to the Company’s business;

(vi) by his training, experience and expertise, the Executive’s services to the Company will be special and unique;

(vii) the covenants and agreements of the Executive contained in this Section 9 are essential to the business and goodwill of the Company; and

(viii) if the Executive leaves the Company’s employ to work for a competitive business, in any capacity, it would cause the Company irreparable harm.

(b) Covenant Against Disclosure . All Confidential Information relating to the Business is, shall be and shall remain the sole property and confidential business information of the Company, free of any rights of the Executive. The Executive shall not make any use of the Confidential Information except in the performance of his duties hereunder and shall not disclose any Confidential Information to third parties, without the prior written consent of the Company.

(c) Return of Company Documents . On the Termination Date or on any prior date upon the Company’s written demand, the Executive will return all memoranda, notes, lists, records, property and other tangible product and documents concerning the Business, including all Confidential Information, in his possession, directly or indirectly, that is in written or other tangible form (together with all duplicates thereof) and that he will not retain or furnish any such Confidential Information to any third party, either by sample, facsimile, film, audio or video cassette, electronic data, verbal communication or any other means of communication.

(d) Further Covenant . During the Term and through the second anniversary of the Termination Date, the Executive shall not, directly or indirectly, take any of the following actions, and, to the extent the Executive owns, manages, operates, controls, is employed by or participates in the ownership, management, operation or control of, or is connected in any manner with, any business, the Executive will use his best efforts to ensure that such business does not take any of the following actions:

(i) Use the Company’s Confidential Information to persuade or attempt to persuade any customer of the Company to cease doing business with the Company, or to reduce the amount of business any customer does with the Company;

(ii) in a manner that competes with the Company’s business, use the Company’s Confidential Information to solicit for himself or any entity the business of a customer of the Company or the business of a former customer of the Company within twelve (12) months prior to the termination of the Executive’s employment; or

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(iii) persuade or attempt to persuade any employee or independent contractor of the Company to leave the service of the Company, or hire or engage, directly or indirectly, any individual who was an employee or independent contractor of the Company within one (1) year prior to the Executive’s Termination Date.

(e) Enforcement . The Executive acknowledges and agrees that any breach by him of any of the provisions of this Section 9 (the “ Restrictive Covenants ”) would result in irreparable injury and damage for which money damages would not provide an adequate remedy. Therefore, if the Executive breaches or threatens to commit a breach of any of the provisions of Section 9, the Company shall have the ability to seek the following rights and remedies, each of which rights and remedies shall be independent of the other and severally enforceable, and all of which rights and remedies shall be in addition to, and not in lieu of, any other rights and remedies available to the Company under law or in equity (including, without limitation, the recovery of damages): (i) the right and remedy to have the Restrictive Covenants specifically enforced (without posting bond and without the need to prove damages) by any court having equity jurisdiction, including, without limitation, the right to an entry against the Executive of restraining orders and injunctions (preliminary, mandatory, temporary and permanent) against violations, threatened or actual, and whether or not then continuing, of such covenants; and (ii) the right and remedy to require the Executive to account for and pay over to the Company all compensation, profits, monies, accruals, increments or other benefits (collectively, “ Benefits ”) derived or received by him as the result of any transactions constituting a breach of the Restrictive Covenants, and the Executive shall account for and pay over such Benefits to the Company and, if applicable, its affected subsidiaries and/or affiliates. The Executive agrees that in any action seeking specific performance or other equitable relief, he will not assert or contend that any of the provisions of this Section 9 are unreasonable or otherwise unenforceable. Other than a material breach of this Agreement, the existence of any claim or cause of action by the Executive, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement of the Restrictive Covenants.

10. Intellectual Property .

(a) Works for Hire . All creations, inventions, ideas, designs, software, copyrightable materials, trademarks, and other technology and rights (and any related improvements or modifications), whether or not subject to patent or copyright protection (collectively, “ Creations ”), relating to any activities of the Company which were, are, or will be conceived by the Executive or developed by the Executive in the course of his employment or other services with the Company, whether conceived alone or with others and whether or not conceived or developed during regular business hours, and if based on Confidential Information, after the termination of the Executive’s employment, shall be the sole property of the Company and, to the maximum extent permitted by applicable law, shall be deemed “works made for hire” as that term is used in the United States Copyright Act. The Executive agrees to assign and hereby does assign to the Company all Creations conceived or developed from the start of this employment with the Company through to the Termination Date, and after the Termination Date if the Creation incorporates or is based on any Confidential Information.

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(b) Assignment . To the extent, if any, that the Executive retains any right, title or interest with respect to any Creations delivered to the Company or related to his employment with the Company, the Executive hereby grants to the Company an irrevocable, paid-up, transferable, sub-licensable, worldwide right and license: (i) to modify all or any portion of such Creations, including, without limitation, the making of additions to or deletions from such Creations, regardless of the medium (now or hereafter known) into which such Creations may be modified and regardless of the effect of such modifications on the integrity of such Creations; and (ii) to identify the Executive, or not to identify his, as one or more authors of or contributors to such Creations or any portion thereof, whether or not such Creations or any portion thereof have been modified. The Executive further waives any “moral” rights, or other rights with respect to attribution of authorship or integrity of such Creations that he may have under any applicable law, whether under copyright, trademark, unfair competition, defamation, right of privacy, contract, tort or other legal theory.

Notwithstanding the foregoing, pursuant to California Labor Code Section 2870, the foregoing shall not apply to an invention that Executive developed entirely on his own time without using the Company’s equipment, supplies, facilities, or trade secret information except for those inventions that either:

•

Relate at the time of conception or reduction to practice of the invention to the Company’s business, or actual or demonstrably anticipated research or development of the Company; or

•

Result from any work performed by the Executive for the Company.

(c) Disclosure . The Executive will promptly inform the Company of any Creations he conceives or develops during the Term. The Executive shall (whether during his employment or after the termination of his employment) execute such written instruments and do other such acts as may be necessary in the opinion of the Company or its counsel to secure the Company’s rights in the Creations, including obtaining a patent, registering a copyright, or otherwise (and the Executive hereby irrevocably appoints the Company and any of its officers as his attorney in fact to undertake such acts in his name). The Executive’s obligation to execute written instruments and otherwise assist the Company in securing its rights in the Creations will continue after the termination of his employment for any reason, the Company shall reimburse the Executive for any out-of-pocket expenses (but not attorneys’ fees) he incurs in connection with his compliance with this Section 10(c).

11. Indemnification . During the Term and thereafter, the Company shall indemnify the Executive to the fullest extent provided in the Company’s bylaws and/or Certificate of Incorporation. The Company shall purchase, and at all times maintain in effect, a policy of directors and officer’s insurance coverage.

12. Integration . This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements between the parties concerning such subject matter, including, without limitation, the Prior Employment Agreement.

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13. Successors . This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal representatives, executors, administrators, heirs, distributees, devisees and legatees. In the event of the Executive’s death after his termination of employment but prior to the completion by the Company of all payments due him under this Agreement, the Company shall continue such payments to the Executive’s beneficiary designated in writing to the Company prior to his death (or to his estate, if the Executive fails to make such designation). The Company shall require any successor to the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.

14. Enforceability . If any portion or provision of this Agreement (including, without limitation, any portion or provision of any section of this Agreement) shall to any extent be declared illegal or unenforceable by a court of competent jurisdiction, then the remainder of this Agreement, or the application of such portion or provision in circumstances other than those as to which it is so declared illegal or unenforceable, shall not be affected thereby, and each portion and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

15. Survival . The provisions of this Agreement shall survive the termination of this Agreement and/or the termination of the Executive’s employment to the extent necessary to effectuate the terms contained herein.

16. Waiver . No waiver of any provision hereof shall be effective unless made in writing and signed by the waiving party. The failure of any party to require the performance of any term or obligation of this Agreement, or the waiver by any party of any breach of this Agreement, shall not prevent any subsequent enforcement of such term or obligation or be deemed a waiver of any subsequent breach.

17. Notices . Any notices, requests, demands and other communications provided for by this Agreement shall be sufficient if in writing and delivered in person or sent by a nationally recognized overnight courier service or by registered or certified mail, postage prepaid, return receipt requested, to the Executive at the last address the Executive has filed in writing with the Company or, in the case of the Company, at its main offices, attention of the Board.

18. Amendment . This Agreement may be amended or modified only by a written instrument signed by the Executive and by a duly authorized representative of the Company.

19. Governing Law . This is a California contract and shall be construed under and be governed in all respects by the laws of California for contracts to be performed in that State and without giving effect to the conflict of laws principles of California or any other State. In the event of any alleged breach or threatened breach of this Agreement, the Executive hereby consents and submits to the jurisdiction of the federal and state courts in and of the State of California.

20. Counterparts . This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be taken to be an original; but such counterparts shall together constitute one and the same document.

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IN WITNESS WHEREOF, the parties have executed this Agreement effective on the date and year first above written.


MabVax Therapeutics, Inc.

By:		/s/ J. DAVID HANSEN
Name:		J. David Hansen
Title:		President and Chief Executive Officer

/s/ J. DAVID HANSEN
Executive

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Exhibit 10.10

EMPLOYMENT AGREEMENT

This Employment Agreement (“ Agreement ”) is made as of July 1, 2014, between MabVax Therapeutics, Inc. (the “ Company ”), and Gregory P. Hanson (the “ Executive ”).

WHEREAS, the Company desires to employ the Executive and the Executive desires to be employed by the Company on the terms contained in this Agreement.

1. Position and Duties .

(a) The Executive shall serve as the Company’s Chief Financial Officer, reporting to the Company’s President and Chief Executive Officer (collectively, “CEO”).

(b) The Executive shall perform those services customary to this office and such other lawful duties that the CEO may be reasonably assign to him. The Executive shall devote all of his business time and best efforts to the performance of his duties under this Agreement and shall be subject to, and shall comply with the Company policies, practices and procedures and all codes of ethics or business conduct applicable to his position, as in effect from time to time. Notwithstanding the foregoing, the Executive shall be entitled to (i) serve as a member of the board of directors of a reasonable number of companies, subject to the advance approval of the CEO, which approval shall not be unreasonably withheld, (ii) serve on civic, charitable, educational, religious, public interest or public service boards, subject to the advance approval of the CEO, which approval shall not be unreasonably withheld, and (iii) manage the Executive’s personal and family investments, in each case, to the extent such activities do not materially interfere, as determined by the CEO in good faith, with the performance of the Executive’s duties and responsibilities hereunder.

3. Compensation and Related Matters .

(a) Base Salary . During the Term, the Executive’s annual base salary shall be $215,000 (the “Base Salary”). The Base Salary shall be payable in accordance with the Company’s normal payroll procedures in effect from time to time and may be increased, but not decreased, at the discretion of the Company.

(b) Annual Bonus . During the Term, the Executive shall be entitled to receive a bonus (the “Annual Bonus”) for each calendar year, payable in cash in accordance with, and subject to the terms and conditions of, the Company’s then applicable short-term bonus or other cash incentive program (each, a “Bonus Program”). The Executive’s aggregate target bonus award for each calendar year will be 100% of his then Base Salary (the “Target Annual Bonus”). The Executive’s actual Annual Bonus may range from a minimum amount of 0% to a maximum of 100% of his Target Annual Bonus, which will be determined by the Company and will be contingent upon the attainment of performance goals reasonably established in good faith by the Company based upon the recommendations of the Executive no later than 90 days after the commencement of each calendar year. Any Annual Bonus compensation payable to the Executive shall be payable by March 15 of the calendar year following the calendar year to which such Annual Bonus relates, subject to the condition that the Executive remain employed by the Company through the date the Annual Bonus is paid, except as set forth in Section 6 herein.

(c) Equity . The Board has previously approved a grant to Executive, in consideration for his employment, and effective as of March 13, 2014, of 70,000 shares of Company common stock (the “Shares”). The Shares shall be governed by the Company’s 2014 Employee, Director and Consultant Equity Incentive Plan (the “Plan”) and are evidenced by a separate Award agreement, dated as of DATE.

(d) Business Expenses . During the Term, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by him in performing services hereunder, in accordance with the policies and procedures then in effect and established by the Company for its senior executive officers.

(e) Other Benefits . During the Term and subject to any contribution therefor required of employees of the Company, the Executive shall be entitled to participate in all equity, pension, savings and retirement plans, welfare and insurance plans, practices, policies, programs and perquisites of employment applicable generally to other senior executives of the Company, except to the extent any employee benefit plan provides for benefits otherwise provided to the Executive hereunder (e.g., annual bonuses and severance). Such participation shall be subject to (i) requirements of applicable law, (ii) the terms of the applicable plan documents, (iii) generally applicable Company policies, and (iv) the discretion of the Board or any administrative or other committee provided for under or contemplated by such plan. The Executive shall have no recourse against the Company under this Agreement in the event that the Company should alter, modify, add to or eliminate any or all of its employee benefit plans.

(f) Vacation; Holidays . During the Term, the Executive shall be entitled to take up to 30 days of paid time off per calendar year, to be taken in accordance with the policies applicable to senior executives of the Company generally. The Executive shall also be entitled to paid holidays in accordance with the policies applicable to senior executives of the Company generally.

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4. Termination . The Executive’s employment may be terminated prior to the expiration of the Term hereof and this Agreement may be terminated under the following circumstances:

(a) Death . The Executive’s employment shall terminate upon his death.

(d) Termination by the Company without Cause . The Company may terminate the Executive’s employment at any time without Cause upon 30 days prior written notice.

(e) Termination by the Executive . The Executive may terminate his employment at any time for any reason other than a Good Reason, upon 30 days prior written notice.

(f) Termination by the Executive for Good Reason . The Executive may terminate his employment for Good Reason. For purposes of this Agreement, “Good Reason” means the existence of any one or more of the following conditions without the Executive’s consent, provided Executive submit written notice to the CEO within 45 days such condition(s) first arose specifying the condition(s): (i) a material change in or reduction of the Executive’s authority, duties and responsibilities, or the assignment to the Executive of duties materially inconsistent with the Executive’s position with the Company; (ii) a material reduction in the Executive’s then current Base Salary or Target Annual Bonus opportunity; or (iii) the requirement that Executive relocate to an office location more than fifty (50) miles from the San Diego, California area. The Executive’s continued employment subsequent to an event that may constitute Good Reason shall not be deemed to be a waiver of his rights under this provision. Upon receipt of written notice from the Executive regarding a condition constituting Good Reason, the Company shall then have 30 days to correct the condition (the “Cure Period”). If such condition is not corrected by the last day of the Cure Period, the Executive’s resignation for Good Reason shall become effective on the 31st day following the written notice.

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(h) Expiration . Executive’s employment shall terminate on the Expiration Date unless renewed or extended pursuant to Section 2.

5. Compensation upon Termination .

(i) Accrued Obligations . The Company shall pay the Accrued Obligations earned through the Termination Date (payable at the time provided for in Section 5(a)).

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by multiplying the amount of the Annual Bonus which would be due for the full calendar year by a fraction, the numerator of which is the number of days during the calendar year of termination that the Executive is employed by the Company and the denominator of which is 365) (the “Pro-Rata Bonus”) payable in accordance with Section 6.

(c) Termination by the Company for Disability, or without Cause, by the Executive with Good Reason, for Non-Renewal by the Company, or in connection with a Change in Control . If, prior to the expiration of the Term, the Executive’s employment is terminated as a result of Disability pursuant to Section 4(b), by the Company without Cause pursuant to Section 4(d), the Executive terminates his employment for Good Reason pursuant to Section 4(f), the Executive terminates his employment in connection with a Change in Control pursuant to Section 4(g), or for the expiration of the Term pursuant to Section 4(h) because the Company fails to renew the Agreement pursuant to Section 2, then the Executive shall be entitled to the following subject to Section 6:

(i) The Company shall pay and provide the Executive with the benefits set forth in 5(b) (i) (Accrued Obligations), 5(b)(ii) (Unpaid Bonus), 5(b)(iii)

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(Pro-Rata Bonus), 5(b)(iv) (Vesting Acceleration), and the continuation of benefits for 12 months as set forth in Section 5(b)(v) (Continuation of Benefits) provided that if Executive obtains other employment that offers group health benefits, such continued coverage by the Company under subsection (b)(v) (Continuation of Benefits) shall cease as of such coverage date; and

7. Section 409A Compliance .

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the in-kind benefits to be provided or the expenses eligible for reimbursement in any other taxable year. Such right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.

(iii) It is intended that each installment of the payments and benefits provided under Section 5 of this Agreement shall be treated as a separate “payment” for purposes of Section 409A of the Code. In particular, the installment severance payments set forth in Section 7(b)(ii) of this Agreement shall be divided into two portions. That number of installments commencing on the first payment date set forth in Section 7 of this Agreement that are in the aggregate less than two times the applicable compensation limit under Section 401(a)(17) of the Code for the year in which the Termination Date occurs (provided the termination of the Executive’s employment is also a separation from service) shall be payable in accordance with Treas. Reg. § 1.409A-l(b)(9)(iii) as an involuntary separation plan. The remainder of the installments shall be paid in accordance with Sections 7(b)(i) and (ii) above.

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8. Certain Reductions in Payments .

(d) 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, under circumstances where the initial determination resulted in Reduced Payments, the Internal Revenue Service may later determine such reduction was not large enough to avoid the Excise Tax on the Payments (making the Net After-Tax Receipt of aggregate Payments less than if no reduction had occurred). Under such circumstances, in the event that the Internal Revenue Service or a court, as applicable, finally and in a decision that has become unappealable or a decision which is nonfinal but which the Company elects not to appeal, determines that the Payments are subject to the Excise Tax, the amount of the Reduced Payments shall be paid or

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distributed by the Company to or for the benefit of the Executive within 30 days of such final determination; provided that (i) the Executive shall not initiate any proceeding or other contests regarding these matters, other than at the direction of the Company, and shall provide notice to the Company of any proceeding or other contest regarding these matters initiated by the Internal Revenue Service and (ii) the Company shall be entitled to direct and control all such proceedings and other contests, if it commits to do so, it shall pay all fees (including without limitation legal and other professional fees) associated therewith.

(f) All fees and expenses of the Accounting Firm in implementing the provisions of this Section 8 shall be borne by the Company.

(h) Definitions . The following terms shall have the following meanings for purposes of this Section 8.

(ii) “Agreement Payment” shall mean a Payment paid or payable pursuant to this Agreement including, for the avoidance of doubt, any acceleration of vesting of equity awards.

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(vii) “Safe Harbor Amount” means (x) 3.0 times the Executive’s “base amount,” within the meaning of Code Section 280G(b)(3), minus (y) $1.00.

9. Confidentiality and Restrictive Covenants .

(a) The Executive acknowledges that:

(ii) the Company is dependent on the efforts of a certain limited number of persons who have developed, or will be responsible for developing the Company’s Business;

(iii) the Company’s Business is national in scope;

(iv) the Business in which the Company is engaged is intensely competitive and that Executive’s employment by the Company will require that he have access to and knowledge of nonpublic confidential information of the Company and the Company’s Business, including, but not limited to, certain/all of the Company’s products, plans for creation, acquisition or disposition of products or publications, strategic and expansion plans, formulas, research results, marketing plans, financial status and plans, budgets, forecasts, profit or loss figures, distributors and distribution strategies, pricing strategies, improvements, sales figures, contracts, agreements, then existing or then prospective suppliers and sources of supply and customer lists, undertakings with or with respect to the Company’s customers or prospective customers, and patient information, product development plans, rules and regulations, personnel information and trade secrets of the Company, all of which are of vital importance to the success of the Company’s business (collectively, “Confidential Information”);

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(vi) by his training, experience and expertise, the Executive’s services to the Company will be special and unique;

(vii) the covenants and agreements of the Executive contained in this Section 9 are essential to the business and goodwill of the Company; and

(viii) if the Executive leaves the Company’s employ to work for a competitive business, in any capacity, it would cause the Company irreparable harm.

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10. Intellectual Property .

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Creations; and (ii) to identify the Executive, or not to identify his, as one or more authors of or contributors to such Creations or any portion thereof, whether or not such Creations or any portion thereof have been modified. The Executive further waives any “moral” rights, or other rights with respect to attribution of authorship or integrity of such Creations that he may have under any applicable law, whether under copyright, trademark, unfair competition, defamation, right of privacy, contract, tort or other legal theory.

•

Relate at the time of conception or reduction to practice of the invention to the Company’s business, or actual or demonstrably anticipated research or development of the Company; or

•

Result from any work performed by the Executive for the Company.

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18. Amendment . This Agreement may be amended or modified only by a written instrument signed by the Executive and by a duly authorized representative of the Company.

IN WITNESS WHEREOF, the parties have executed this Agreement effective on the date and year first above written.

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MabVax Therapeutics, Inc.

By:		/s/ J. DAVID HANSEN
Name:		J. David Hansen
Title:		President and Chief Executive Officer

/s/ GREGORY P. HANSON
Executive

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Exhibit 10.11

EMPLOYMENT AGREEMENT

This Employment Agreement (“ Agreement ”) is made as of July 1, 2014, between MabVax Therapeutics, Inc. (the “ Company ”), and Wolfgang W. Scholz, Ph.D (the “ Executive ”).

WHEREAS, the Company and the Executive previously entered into an Employment Agreement dated as of September 2, 2011 (the “Prior Employment Agreement”); and

1. Position and Duties .

(a) The Executive shall serve as the Company’s Vice President, Antibody Discovery, reporting to the Company’s President and Chief Executive Officer (collectively, “CEO”).

3. Compensation and Related Matters .

(a) Base Salary . During the Term, the Executive’s annual base salary shall be $213,803 (the “Base Salary”). The Base Salary shall be payable in accordance with the Company’s normal payroll procedures in effect from time to time and may be increased, but not decreased, at the discretion of the Company.

(b) Annual Bonus . During the Term, the Executive shall be entitled to receive a bonus (the “Annual Bonus”) for each calendar year, payable in cash in accordance with, and subject to the terms and conditions of, the Company’s then applicable short-term bonus or other cash incentive program (each, a “Bonus Program”). The Executive’s aggregate target bonus award for each calendar year will be 50% of his then Base Salary (the “Target Annual Bonus”). The Executive’s actual Annual Bonus may range from a minimum amount of 0% to a maximum of 50% of his Target Annual Bonus, which will be determined by the Company and will be contingent upon the attainment of performance goals reasonably established in good faith by the Company based upon the recommendations of the Executive no later than 90 days after the commencement of each calendar year. Any Annual Bonus compensation payable to the Executive shall be payable by March 15 of the calendar year following the calendar year to which such Annual Bonus relates, subject to the condition that the Executive remain employed by the Company through the date the Annual Bonus is paid, except as set forth in Section 6 herein.

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4. Termination . The Executive’s employment may be terminated prior to the expiration of the Term hereof and this Agreement may be terminated under the following circumstances:

(a) Death . The Executive’s employment shall terminate upon his death.

(d) Termination by the Company without Cause . The Company may terminate the Executive’s employment at any time without Cause upon 30 days prior written notice.

(e) Termination by the Executive . The Executive may terminate his employment at any time for any reason other than a Good Reason, upon 30 days prior written notice.

(f) Termination by the Executive for Good Reason . The Executive may terminate his employment for Good Reason. For purposes of this Agreement, “Good Reason” means the existence of any one or more of the following conditions without the Executive’s consent, provided Executive submit written notice to the CEO within 45 days such condition(s) first arose specifying the condition(s): (i) a material change in or reduction of the Executive’s authority, duties and responsibilities, or the assignment to the Executive of duties materially inconsistent with the Executive’s position with the Company; (ii) a material reduction in the Executive’s then current Base Salary or Target Annual Bonus opportunity; or (iii) the requirement that Executive relocate to an office location more than fifty (50) miles from the San Diego, California area. The Executive’s continued employment subsequent to an event that may constitute Good Reason shall not be deemed to be a waiver of his rights under this provision. Upon receipt of written notice from the Executive regarding a condition constituting Good Reason, the Company shall then have 30 days to correct the condition (the “Cure Period”). If such condition is not corrected by the last day of the Cure Period, the Executive’s resignation for Good Reason shall become effective on the 31st day following the written notice.

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(h) Expiration . Executive’s employment shall terminate on the Expiration Date unless renewed or extended pursuant to Section 2.

5. Compensation upon Termination .

(i) Accrued Obligations . The Company shall pay the Accrued Obligations earned through the Termination Date (payable at the time provided for in Section 5(a)).

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7. Section 409A Compliance .

(iii) It is intended that each installment of the payments and benefits provided under Section 5 of this Agreement shall be treated as a separate “payment” for

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8. Certain Reductions in Payments .

(d) 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

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(f) All fees and expenses of the Accounting Firm in implementing the provisions of this Section 8 shall be borne by the Company.

(h) Definitions . The following terms shall have the following meanings for purposes of this Section 8.

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(ii) “Agreement Payment” shall mean a Payment paid or payable pursuant to this Agreement including, for the avoidance of doubt, any acceleration of vesting of equity awards.

(vii) “Safe Harbor Amount” means (x) 3.0 times the Executive’s “base amount,” within the meaning of Code Section 280G(b)(3), minus (y) $1.00.

9. Confidentiality and Restrictive Covenants .

(a) The Executive acknowledges that:

(ii) the Company is dependent on the efforts of a certain limited number of persons who have developed, or will be responsible for developing the Company’s Business;

(iii) the Company’s Business is national in scope;

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(vi) by his training, experience and expertise, the Executive’s services to the Company will be special and unique;

(vii) the covenants and agreements of the Executive contained in this Section 9 are essential to the business and goodwill of the Company; and

(viii) if the Executive leaves the Company’s employ to work for a competitive business, in any capacity, it would cause the Company irreparable harm.

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10. Intellectual Property .

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•

Relate at the time of conception or reduction to practice of the invention to the Company’s business, or actual or demonstrably anticipated research or development of the Company; or

•

Result from any work performed by the Executive for the Company.

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18. Amendment . This Agreement may be amended or modified only by a written instrument signed by the Executive and by a duly authorized representative of the Company.

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IN WITNESS WHEREOF, the parties have executed this Agreement effective on the date and year first above written.


MabVax Therapeutics, Inc.

By:		/s/ J. DAVID HANSEN
Name:		J. David Hansen
Title:		President and Chief Executive Officer

/s/ WOLFGANG W. SCHOLZ
Executive

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Exhibit 10.12

M AB V AX T HERAPEUTICS , I NC .

C OMMON S TOCK P URCHASE A GREEMENT

THIS COMMON STOCK PURCHASE AGREEMENT (this “ Agreement ”) is entered into effective as of July 3, 2014, by and among MabVax Therapeutics, Inc., a Delaware corporation (the “ Company ”), and the persons and entities listed on the attached Exhibit A who become signatories to this Agreement (individually an “ Investor ” and collectively, the “ Investors ”).

R ECITALS

A. The Company desires to sell shares of the Company’s Common Stock, par value $0.001 per share (or shares of Telik’s Common Stock following the Merger) (the “ Common Stock ”), to the Investors, and the Investors desire to purchase such shares of Common Stock from the Company, subject to the terms and conditions set forth in this Agreement;

B. The Company is party to that certain Agreement and Plan of Merger, dated as of May 12, 2014 (the “ Merger Agreement ”), by and among the Company, Telik Acquisition Corp. and Telik, Inc. (“ Telik ”), pursuant to which the Company will become a wholly owned subsidiary of Telik (the “ Merger ”) and all shares of Common Stock will be converted into the right to receive shares of Common Stock of Telik on the terms and conditions set forth therein; and

C. In connection with the sale and issuance of the Common Stock, each Investor participating in a Closing (as defined below) held prior to the consummation of the Merger will become party to and execute a deliver a counterpart signature page to that certain Stockholders’ Agreement, dated as of February 12, 2014, by and among the Company and the Stockholders, attached hereto as Exhibit B (the “ Stockholders’ Agreement ”).

THE PARTIES AGREE AS FOLLOWS:

SECTION 1

P URCHASE AND S ALE OF C OMMON S TOCK

1.1 Purchase and Sale . Subject to the terms and conditions of this Agreement, the Company shall issue and sell to the Investors and the Investors shall purchase from the Company, at the purchase price of $2.59 per share (as the same may be adjusted from time to time in connection with the Merger and any stock split, stock dividend or similar adjustment, the “ Purchase Price ”), a total of up to 3,937,008 shares of Common Stock of the Company (or, with respect to any Closing held on or after the consummation of the Merger, an equivalent number of shares of Telik Common Stock, calculated as set forth in the Merger Agreement and as may be adjusted from time to time in connection with any stock split, stock dividend or similar adjustment) excluding any Adjustment Shares (the “ Shares ”), provided, however, that the aggregate Purchase Price of all Shares issued pursuant to this Agreement (other than Adjustment Shares) shall not exceed $10,000,000. The number of Shares to be purchased by each Investor is set forth opposite the name of such Investor on Exhibit A .

1.2 Closing .

(a) Initial Closing . The initial purchase and sale of the Shares shall take place remotely via the exchange of documents and signatures, at 10:00 a.m., on July 3, 2014, at the offices of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., located at 3580 Carmel Mountain Road, Suite 300, San Diego, CA 92130 or at such other time and place as the Company and a majority of the Investors mutually agree upon, orally or in writing (which time and place are designated as the “ Initial Closing ”). In the event there is more than one closing, the term “ Closing ” shall apply to each such closing unless otherwise specified. The date of a Closing is hereinafter referred to as the “ Closing Date ”.

(b) Subsequent Closing . The Company may hold subsequent closings (each a “ Subsequent Closing ”) for the purchase and sale of Shares, provided that the aggregate Purchase Price of Shares sold may not exceed $10,000,000, except as may be increased in the discretion of the Company. Exhibit A shall be revised by the Company to reflect the sale of Shares at any Subsequent Closing, with the purchasers of such Shares to be treated as Investors for all purposes hereunder. At the Closing and at each Subsequent Closing, each Investor shall purchase that number of Shares designated opposite such Investor’s name on Exhibit A for the aggregate Purchase Price set forth on Exhibit A , or at such other time and place upon which the Company and the Investors may agree.

Adjustment Shares . In the event that, during the period beginning as of the date of this Agreement and ending as of the first to occur of (such date, the “ Termination Date ”) (i) the date on which the Company raises an aggregate of $10,000,000 through the sale and issuance of its equity securities (including proceeds from the sale and issuance of the Shares pursuant to this Agreement, any securities by Telik following the consummation of the Merger or upon the exercise or conversion of options, warrants and other convertible securities) and (ii) December 31, 2015, the Company (or Telik, as the case may be) issues any equity securities (other than securities issuable upon the exercise or conversion of options, warrants and other convertible securities outstanding as of the date of this Agreement or issued in exchange for such outstanding options, warrants or other convertible securities pursuant to the Merger Agreement) at a price per share less than $2.54 per share then, without any additional consideration from any Investor, the Company shall issue to each Investor participating in a Closing held on or prior to the date on which the Merger is consummated (each, an “ Eligible Investor ”) as of the Termination Date a number of additional Shares (the “ Adjustment Shares ”) equal to the lesser of (A) the difference (if positive) between (x) the quotient of (I) the aggregate Purchase Price paid by such Eligible Investor in all Closings held hereunder divided by (II) the weighted average price of all securities issued by the Company (other than Excluded Securities, as defined below) during the period starting as of the Initial Closing and ending on the Termination Date minus (y) the aggregate number of Shares purchased by such Eligible Investor in all Closings held hereunder and (B) 33% of the aggregate number of Shares purchased by such Eligible Investor in all Closings held hereunder and held by such Eligible Investor as of the Termination Date.

As used herein, the term “ Excluded Securities ” shall mean securities of the Company or a successor of the Company issued or issuable (i) upon the exercise or conversion of options, warrants and other convertible securities outstanding as of the date of this Agreement, (ii) pursuant to an equity incentive plan of the Company or a successor of the Company approved by the Company’s or its successor’s Board of Directors, or (iii) in exchange for such outstanding options, warrants or other convertible securities issued pursuant to the Merger Agreement.

1.3 Delivery . At each Closing, the Company will deliver to each Investor a certificate representing the Shares which that Investor is obtaining against delivery to the Company by such Investor at such Closing, of (a) an executed counterpart of this Agreement and the Stockholders’ Agreement (with respect to Investors participating in a Closing held prior to the consummation of the Merger only) (collectively, the “ Transaction Agreements ”), and (b) the purchase price of such Shares as set forth on Exhibit A by wire transfer or a certified or cashiers’ check payable to the Company. At the Termination Date and to the extent applicable, the Company will deliver to each Eligible Investor a certificate representing the Adjustment Shares which that Eligible Investor is obtaining.

SECTION 2

R EPRESENTATIONS AND W ARRANTIES OF THE C OMPANY

The Company hereby represents and warrants to each Investor, except as set forth in the Proxy Statement attached hereto as Exhibit C (the “ Proxy Statement ”), that the following representations are true and complete in all material respects as of the Initial Closing Date.

2.1 Organization and Standing . The Company is a corporation duly organized and validly existing under the laws of the State of Delaware and is in good standing under such laws and is duly qualified and in good standing under the laws of the State of California. The Company has the requisite corporate power to own and operate its properties and assets, and to carry on its business as presently conducted.

2.2 Corporate Power . The Company will have at each Closing Date and the Termination Date all requisite legal and corporate power to execute and deliver the Transaction Agreements and to sell and issue the Shares, and the Adjustment Shares to the extent issuable, hereunder, and to carry out and perform its obligations under the terms of each Transaction Agreement.

2.3 Validity . When executed and delivered by the Investors, each Transaction Agreement constitutes a valid and binding obligation of the Company enforceable in accordance with its terms, subject to laws of general application relating to bankruptcy, insolvency and the relief of debtors.

2.4 Litigation . Except as set forth under the heading “Legal Proceedings” in the Proxy Statement, there are no actions, suits, proceedings or investigations pending or, to the Company’s knowledge, currently threatened against the Company or its properties, before any court or governmental agency.

2.5 Governmental Consent . No consent, approval or authorization of or designation, declaration or filing with any governmental authority on the part of the Company is required in connection with the valid execution and delivery of the Transaction Agreements, or the offer, sale or issuance of the Shares, and the Adjustment Shares to the extent issuable, hereunder, or the consummation of any other transaction contemplated hereby or thereby, except for the filing of a Form D under Regulation D promulgated under the Securities Act of 1933, as amended (and, together with the regulations promulgated thereunder, the “ Securities Act ”) and the qualification (or taking such action as may be necessary to secure an exemption from qualification, if available) of the offer and sale of the Shares, and the Adjustment Shares to the extent issuable, under applicable state securities law and other applicable Blue Sky laws, which filing and qualification, if required, will be accomplished.

2.6 Capitalization . The capitalization of the Company immediately prior to the Initial Closing and prior to giving effect to the transactions contemplated by the Merger Agreement is set forth in Exhibit D .

2.7 Duly Authorized . The outstanding shares of the capital stock of the Company are duly authorized and validly issued, fully paid and nonassessable, have been approved by all requisite stockholder action, and have been issued in compliance with all relevant state and federal securities laws.

2.8 Title to Property and Assets . The properties and assets the Company owns are owned by the Company free and clear of all mortgages, deeds of trust, liens, encumbrances and security interests except for statutory liens for the payment of current taxes that are not yet delinquent and liens, encumbrances and security interests which arise in the ordinary course of business and which do not affect material properties and assets of the Company.

2.9 Subsidiaries . The Company does not own or control, directly or indirectly, any equity interest in any other corporation, partnership, trust, joint venture, association or other entity. The Company is not a participant in any joint venture, partnership or similar arrangement.

2.10 No Disqualification Events . None of the Company, and of its predecessors, any director, executive officer, other officer of the Company, any beneficial owner of 20% or more of the Company’s outstanding voting capital stock, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with the Company in any capacity at the time of sale (each, a “ Company Covered Person ”) is subject to any “Bad Actor” disqualifications described in Rule 506(d)(l)(i) to (viii) under the Securities Act (a “ Disqualification Event ”), except a Disqualification Event covered by Rule 506(d)(2) or (d)(3) applies. The Company has exercised reasonable care to determine (a) the identity of each person that is a Company Covered Person, and (b) whether any Company Covered Person is subject to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e) under the Securities Act, and has furnished to its agents a copy of any disclosures provided thereunder.

SECTION 3

R EPRESENTATIONS AND W ARRANTIES OF THE I NVESTORS

Each Investor, severally and not jointly, represents and warrants to the Company that the following representations are true and complete in all material respects as of the Closing Date in which such Investor participates, and, to the extent any Adjustment Shares are issued to an Eligible Investor, as of the Termination Date:

3.1 Validity . When executed and delivered by the Investor, and assuming execution and delivery by the Company, each Transaction Agreement shall constitute a valid obligation of the Investor, enforceable in accordance with its respective terms.

3.2 Investment . This Agreement is made with the Investor in reliance upon its representation to the Company, which by the Investor’s execution of this Agreement, Investor hereby confirms, that the Shares, and the Adjustment Shares to the extent issuable, to be received by the Investor shall be acquired for investment for Investor’s own account, not as a nominee or agent, and not with a view to the sale or distribution of any part thereof, and that the Investor has no present intention of selling, granting any participation in, or otherwise distributing any of the Shares, and the Adjustment Shares to the extent issuable. By executing this Agreement, the Investor further represents that it has no contract, undertaking, agreement, or arrangement with any person to sell, transfer, or grant participation to such person or to any third person, with respect to any of the Shares, or the Adjustment Shares to the extent issuable. The Investor was not offered or sold the Shares, or the Adjustment Shares to the extent issuable, directly or indirectly, by means of any form of general solicitation or general advertisement, including (i) any advertisement, article, notice or other communication published in any newspaper, magazine or similar medium or broadcast over television or radio or (ii) any seminar or other meeting whose attendees had been invited by general solicitation or general advertising.

3.3 No Public Market . The Investor understands and acknowledges that the offering of the Shares, and the Adjustment Shares to the extent issuable, pursuant to this Agreement shall not be registered under the Securities Act on the grounds that the offering and sale of securities contemplated by this Agreement are exempt from registration pursuant to Section 4(a)(2) and/or Section 3(b) of the Securities Act, and that the Company’s reliance upon such exemption is predicated upon Investor’s representations as set forth in this Agreement. The Investor further understands that no public market exists prior to the consummation of the Merger for any of the securities issued by the Company, that the Company has given no assurances that the Merger will be consummated or that any other public market shall ever exist for the Company’s securities and that the Company has no obligation to any Investor to register any of the shares for sale under the Securities Act or to consummate the Merger.

3.4 Limitations on Transferability . Investor covenants that in no event shall it dispose of any of the Shares, and the Adjustment Shares to the extent issuable, (other than pursuant to Rule 144 promulgated by under the Securities Act (“ Rule 144 ”) or any similar or analogous rule) unless and until (a) the Investor shall have notified the Company of the proposed disposition and shall have furnished the Company with a statement of the circumstances surrounding the proposed disposition, and (b) if requested by the Company, the Investor shall have furnished the Company with an opinion of counsel satisfactory in form and substance to the Company and the Company’s counsel to the effect that (x) such disposition shall not require registration under the Securities Act and (y) appropriate action necessary for compliance with the Securities Act and any applicable state, local, or foreign law has been taken. Notwithstanding the limitations set forth in the foregoing sentence, if the Investor is a partnership it may transfer Shares to its constituent partners or a retired partner of such partnership who retires after the date hereof, or to the estate of any such partner or retired partner or transfer by gift, will, or intestate succession to any such partner’s spouse or lineal descendants or ancestors without the necessity of registration or opinion of counsel if the transferee agrees in writing to be subject to the terms of this Agreement to the same extent if such transferee were an Investor; provided , however , that Investor hereby covenants not to effect such transfer if such transfer either would invalidate the securities laws exemptions pursuant to which the Shares, and the Adjustment Shares to the extent issuable, were originally offered and sold or would itself require registration and/or qualification under the Securities Act or applicable state securities laws. Each certificate evidencing the Shares transferred as above provided shall bear the appropriate restrictive legends set forth in Section 6 of this Agreement. In addition, the Investor hereby acknowledges and agrees that any transfer shall also only be effected in conformity with the provisions of the Stockholders Agreement to which such Investor is a party.

3.5 Experience . The Investor represents that: (a) it has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of its prospective investment in the Shares; (b) it believes it has received all the information it has requested from the Company and considers necessary or appropriate for deciding whether to obtain the Shares; (c) it has had the opportunity to discuss the Company’s business, management, and financial affairs with the Company’s management, (d) it has the ability to bear the economic risks of its prospective investment; and (e) it is able, without materially impairing its financial condition, to hold the Shares for an indefinite period of time and to suffer a complete loss on its investment.

3.6 Access to Information . The Investor (a) has had an opportunity to discuss the Company’s business, management and financial affairs with the Company’s management and the opportunity to inspect Company facilities and such books and records and material contracts as the Investor deemed necessary to its determination to purchase the Shares and (b) has read and reviewed the Proxy Statement.

3.7 Accredited Investor . The Investor presently qualifies and shall, as of the Closing Date of each Closing in which the Investor participates, qualify as an “accredited investor” within the meaning of Regulation D of the rules and regulations promulgated under the Securities Act.

3.8 Confidentiality . The Investor agrees that it shall keep confidential and shall not use, disclose or divulge any information which such Investor may obtain from the Company, pursuant to financial statements, reports and other materials submitted by the Company as required hereunder or under any other documents, or pursuant to information rights granted under any other documents unless such information is known, or until such information becomes known, to the public through no fault of such Investor or its agents, or unless the Company’s President or Chief Executive Officer gives written consent to the Investor’s release of such information, except that no such written consent shall be required (and Investor shall be free to release such information) if such information is to be provided to Investor’s counsel or accountant, or to an officer, director, general partner, limited partner, stockholder or stockholder, investment counselor or advisor, or employee of an Investor with a need to know such information; provided that any such counsel, accountant, officer, director, general partner, limited partner, stockholder or stockholder, investment counselor or advisor, or employee shall be bound by the provisions of this Section 3.8. Notwithstanding the foregoing, this Section 3.8 shall not apply (a) to information which an Investor learns from a third party with the right to make such disclosure, provided Investor complies with the restrictions imposed by the third party, (b) to information which is in Investor’s possession prior to the time of disclosure by the Company and not acquired by Investor under a confidentiality obligation, and (c) to the extent (after requesting and pursuing confidential treatment to the extent reasonably possible) the Investor is required to disclose such information by law, a governmental regulatory authority or court order.

3.9 Investor’s Liquidity . The Investor (a) has no need for liquidity in the Investor’s investment, (b) is able to bear the substantial economic risks of an investment in the Shares, and the Adjustment Shares to the extent issuable, for an indefinite period and (c) at the present time, can afford a complete loss of such investment. The Investor’s current commitments to illiquid investments is not disproportionate to the Investor’s net worth, and the Investor’s investment in the Shares, and the Adjustment Shares to the extent issuable, will not cause such commitment to become disproportionate.

3.10 Risks . The Investor is aware that the Share, and the Adjustment Shares to the extent issuable, and any securities issued in respect of or exchange for the Shares or the Adjustment Shares are highly speculative and that there can be no assurance as to what return, if any, there may be. Investor acknowledges the risks of purchasing the Shares, and the Adjustment Shares to the extent issuable. The Investor has reviewed the risk factors relating to the Company and its business as set forth in the Proxy Statement, including, without limitation, those relating to the risk that the Merger described therein may not close, and the risk factors relating to the Company’s capital stock attached as Exhibit E hereto. The Investor understands and acknowledges that the Merger may not be consummated or may not be consummated on the terms and conditions set forth in the Merger Agreement.

3.11 Investment Entity . The Investor, if a corporation, partnership, trust or other entity, is authorized and otherwise duly qualified to purchase and hold the Shares, and the Adjustment Shares to the extent issuable; such entity has made its investment decision to purchase the Shares, and the Adjustment Shares to the extent issuable, at

its office address for the Investor as set forth on Exhibit A hereto; and such entity has not been formed for the specific purpose of acquiring the Shares. The Investor, if a natural person, resides in the state identified in the address of the Investor set forth on Exhibit A hereto.

3.12 No Disqualification Events . The Investor represents, after reasonable inquiry, that no Disqualification Event is applicable to the Investor or any Rule 506(d) Related Party (if any), except a Disqualification Event as to which Rule 506(d)(2)(ii) or (iii) or (d)(3) applies. As used herein, “ Rule 506(d) Related Party ” means a person or entity that is a beneficial owner of the Investor’s securities for purposes of Rule 506(d) under the Securities Act.

3.13 Investment by Placement Agent . The Investors acknowledge that Dawson James Securities, Inc. (“ Dawson James ”) is one of the placement agents for the offering of Shares pursuant to this Agreement. Certain affiliates of Dawson James, Robert D. Keyser, Jr., the Chief Executive Officer of Dawson James, and R. Douglas Armstrong, Chief Business Officer of Dawson James, own all of the outstanding membership interests of Auxol Capital, LLC (“ Auxol ”). Auxol holds certain securities of the Company, including 89,461 shares of the Company’s Series C-1 preferred stock (“ Series C-1 Preferred Stock ”), warrants exercisable for up to 44,731 shares of Series C-1 Preferred Stock and 178,922 shares of Common Stock. The Series C-1 Preferred Stock has certain rights and privileges that are superior to the Shares being offered pursuant to this Agreement, including, without limitation, dividend payments, redemption rights and conversion rights. In addition, if the Company is successful in completing the merger described in the Proxy Statement, the holders of Series C-1 Preferred Stock will receive preferred stock of the publicly traded corporation with similar rights, which rights will be superior to the rights of the purchasers of Shares. To the extent that not all of the Shares being offered pursuant to this Agreement are sold, the holders of Series C-1 Preferred Stock, including Auxol, will be required to purchase shares of a to be authorized series of the Company’s preferred stock, which will be designated Series C-2 Preferred Stock (the “ Series C-2 Preferred Stock ”), and which will have substantially the same rights, preferences and privileges as the Series C-1 Preferred Stock. Each Investor’s purchase of Shares will offset Auxol’s obligation to purchase shares of Series C-2 Preferred Stock thereby conferring an additional benefit upon Auxol and its affiliates. In addition, Auxol and/or one or more affiliates of Auxol or Dawson James (together the “ DJ Affiliates ”) may purchase Shares. By executing this Agreement, all Investors also acknowledge that the DJ Affiliates may purchase Shares.

3.14 Placement Agent Fee . The Investors acknowledge that one or more investment banks may be retained by the Company to serve as placement agents for the Shares. The Company has agreed to pay the placement agents cash commissions ranging from 2% to 8% of the aggregate purchase price paid by each purchaser of Shares depending on whether they are prior investors or new investors that are introduced to the Company by such investment bank. Further, the Company may issue to the investment banks warrants to purchase shares of the Company’s Common Stock ranging from 0% to 8% of the Shares purchased by such investors at a price equal to 110% to 125% of the market price for the Common Stock.

SECTION 4

C ONDITIONS TO I NVESTORS O BLIGATIONS AT C LOSING

The obligations of each Investor under Section 1 of this Agreement are subject to the fulfillment at or before the Closing of each of the following conditions, any of which may be waived in writing by such Investor:

4.1 Representations and Warranties True . The representations and warranties made by the Company in Section 2 hereof shall be true and correct in all material respects on the Closing Date with the same force and effect as if they had been made on and as of said date.

4.2 Performance of Obligations . The Company shall have performed and complied with all agreements and conditions herein required to be performed or complied with by it on or before the Closing.

SECTION 5

C ONDITIONS TO C OMPANY ’ S O BLIGATIONS AT C LOSING

The Company’s obligation to sell and issue the Shares at each Closing is, at the option of the Company, subject to the fulfillment on or prior to the Closing Date of the following conditions:

5.1 Representations and Warranties True . The representations and warranties made by the Investors in Section 3 hereof shall be true and correct in all material respects on the Closing Date, and on the date of each Subsequent Closing, with the same force and effect as if they had been made on and as of said date.

5.2 Performance of Obligations . The Investors shall have performed and complied with all agreements and conditions herein required to be performed or complied with by them on or before the Closing.

5.3 Legal Matters . All material matters of a legal nature which pertain to this Agreement and the transactions contemplated hereby shall have been reasonably approved by counsel for the Company.

SECTION 6

C OVENANTS , R ESTRICTIVE L EGENDS AND S TOP -T RANSFER O RDERS

6.1 Restrictive Legends .

(a) Federal Legends . All certificates evidencing the Shares shall bear such restrictive legends as the Company and the Company’s counsel deem necessary or advisable under applicable law or pursuant to this Agreement, including, without limitation, the following:

“THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN ACCORDANCE WITH RULE 144 UNDER THE ACT, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO THE COMPANY STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.”

(b) Other Legends . The certificates evidencing the Shares shall also bear any legend required pursuant to the Stockholders’ Agreement.

6.2 Stop-Transfer Notices . Each Investor agrees that, in order to ensure compliance with the restrictions referred to herein and the restrictions on transfer set forth in the Stockholders Agreement to which the Investor is a party, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company acts as its own transfer agent, it may make appropriate notations to the same effect in its own records.

6.3 Refusal to Transfe r . The Company shall not be required (a) to transfer on its books any Shares that have been sold or otherwise transferred in violation of any of the provisions of any of the Transaction Agreements or (b) to treat as owner of such Shares or to accord the right to vote or pay dividends to any purchaser or other transferee to whom such Shares shall have been so transferred.

6.4 Removal of Legend and Transfer Restrictions . Any legend endorsed on a certificate pursuant to Section 6.1 and the stop transfer instructions with respect to such legended Shares shall be removed, and the Company shall issue a certificate without such legend to the holder of such Shares, if (a) either (i) such Shares are registered under the Securities Act and a prospectus meeting the requirements of Section 10 of the Securities Act is available with respect to such Shares (or securities into which they have been converted) or (ii) if such holder satisfies the requirements of Rule 144 and (b) such Shares are no longer subject to restrictions on transfer pursuant to the Stockholders’ Agreement.

SECTION 7

M ISCELLANEOUS

7.1 Governing Law . This Agreement shall be governed by, and construed and enforced in accordance with, the internal laws of the State of New York, excluding those laws that direct the application of the laws of another jurisdiction.

7.2 Successors and Assigns . Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto, provided, however, that the rights of Investor to purchase the Shares shall not be assignable without the written consent of the Company. In the event that the transaction described in the Proxy Statement is consummated prior to the date on which the Company has issued Shares with an aggregate value of at least $10,000,000 then, without any further action by the Company or any other party to this Agreement, Telik shall assume all obligations of the Company hereunder.

7.3 Entire Agreement . The Transaction Agreements (and the Exhibits hereto and thereto), constitute the entire agreement of the parties with regard to the subject matter hereof and supersede any and all prior negotiations, correspondence, understandings and agreements among the parties regarding the subject matter hereof.

7.4 Notices, Etc. All notices and other communications required or permitted hereunder shall be in writing and shall be deemed effectively given (i) upon actual delivery to the party to be notified, (ii) three (3) business days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one business day after deposit with a recognized overnight courier, specifying next business day delivery, addressed (a) if to an Investor, at the Investor’s address set forth on the Schedule of Investors, or at such other address as the Investor shall have furnished to the Company in writing upon 10 days’ notice, (b) if to any other holder of any Shares, at such address as such holder shall have furnished the Company in writing upon 10 days’ notice or, until any such holder so furnishes an address to the Company, to and at the address of the last holder of such Shares who has so furnished an address to the Company or (c) if to the Company, at the following address or at such other address as the Company shall have furnished to the Investors upon 10 days’ notice:

MabVax Therapeutics, Inc.

11588 Sorrento Valley Road, Suite 20

San Diego, California 92121

Attention: President & CEO

With a copy to:

Mintz Levin Cohn Ferris Glovsky and Popeo, P.C.

3580 Carmel Mountain Road, Suite 300

San Diego, CA 92130

Attention: Jeremy Glaser, Esq.

7.5 Expenses and Fees . Each party shall pay its own expenses incurred, including any legal fees or costs, in connection with the transactions described in this Agreement.

7.6 Severability . If one or more provisions of this Agreement are held to be unenforceable under applicable law, the parties agree to renegotiate such provision in good faith. In the event that the parties cannot reach a mutually agreeable and enforceable replacement for such provision, then such provision(s) shall be excluded from this Agreement and the balance of the Agreement shall be interpreted as if such provision(s) were so excluded and shall be enforceable in accordance with its terms.

7.7 Corporate Securities Law . THE SALE OF THE SECURITIES WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA OR WITH ANY OTHER STATE AND THE ISSUANCE OF SUCH SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR PRIOR TO SUCH QUALIFICATION, OR IN THE ABSENCE OF AN EXEMPTION FROM SUCH QUALIFICATION, IS UNLAWFUL. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED, OR AN EXEMPTION FROM SUCH QUALIFICATION BEING AVAILABLE.

7.8 Delays or Omissions . It is agreed that no delay or omission to exercise any right, power or remedy accruing to any party, upon any breach, default or noncompliance by any other party under this Agreement, shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence therein, or of any similar breach, default or noncompliance thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character on the part of any party of any breach, default or noncompliance under the Agreement, or any waiver on the part of any party of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement, by law, or otherwise afforded to any party, shall be cumulative and not alternative.

7.9 Approval of Amendments and Waivers . Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of, or a written instrument signed by (i) the Company, and (ii) the persons who after the Initial Closing shall hold at least a majority of the then outstanding Shares. Any amendment or waiver effected in accordance with this Section 7.9 shall be binding upon the Company and the Investors and their respective successors and assigns. Notwithstanding the foregoing, the Company may unilaterally amend Exhibit A of this Agreement to add new Investors at Subsequent Closings, as provided in Section 1.2(b) of this Agreement.

7.10 Titles and Subtitles; References . The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. All references in this Agreement to sections, paragraphs, exhibits and schedules shall, unless otherwise provided, refer to sections and paragraphs hereof and exhibits and schedules attached hereto, all of which exhibits and schedules are incorporated herein by this reference.

7.11 Void Transfers . Each Investor, as a condition to purchasing the Shares, agrees that such Investor shall not sell, transfer or pledge any shares, other than in the manner expressly permitted in the Transaction Agreements, and any such sale, transfer or pledge of the Shares in violation of any Transaction Agreement shall be void.

7.12 Survival . Unless otherwise set forth in this Agreement, the representations and warranties of the Company and the Investors contained in or made pursuant to this Agreement shall not survive the Closing Date on which they are made.

7.13 Further Assurances . Each of the parties to this Agreement shall execute and deliver all additional documents and instruments and shall do all acts and things reasonably requested (a) in connection with the performance of the obligations undertaken in any Transaction Agreement, (b) to evidence the transactions contemplated by any Transaction Agreement and (c) otherwise to effectuate in good faith the intent of the parties.

7.14 Telecopy Execution and Delivery . A facsimile, telecopy or other reproduction of this Agreement may be executed by one or more parties hereto and delivered by such party by facsimile or any similar electronic transmission device pursuant to which the signature of or on behalf of such party can be seen. Such execution and delivery shall be considered valid, binding and effective for all purposes. At the request of any party hereto, all parties hereto agree to execute and deliver an original of this Agreement as well as any facsimile, telecopy or other reproduction hereof.

7.15 Counterparts . This Agreement may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all such counterparts together will constitute one and the same instrument.

7.16 Exculpation Among Investors . Each Investor acknowledges that it is not relying upon any person, firm or corporation, other than the Company and its officers and directors, in making its investment or decision to invest in the Company. Each Investor agrees that no Investor nor the respective controlling persons, officers, directors, partners, agents, or employees of any Investor shall be liable to any other Investor for any action heretofore or hereafter taken or omitted to be taken by any of them in connection with the purchase of the Shares.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date set forth in the first paragraph hereof.


COMPANY:	MABVAX THERAPEUTICS, INC.
	a Delaware corporation
	By:	/s/ J. David Hansen
		J. David Hansen, President & CEO

INVESTORS:	JGB CAPITAL LP
	By:	/s/ Brett Cohen
		Brett Cohen, President

	EMPERY ASSET MASTER, LTD.
	By:	/s/ Ryan M. Lane
		Ryan M. Lane, Managing Member
	By:	Empery Asset Management LP, its authorized agent
	By:	Empery AM GP, LLC, its general partner

	EMPERY TAX EFFICIENT LP
	By:	Empery Asset Management LP, its authorized agent
	By:	Empery AM GP, LLC, its general partner
	By:	/s/ Ryan M. Lane
		Ryan M. Lane, Managing Member

	Matthew H. Spiro
	/s/ Matthew Spiro

	Michael Herman
	/s/ Michael Herman

	CAVALRY FUND I, LP
	By:	/s/ Thomas P. Walsh
		Thomas P. Walsh, General Partner

	Waqas A. Khatri
	/s/ Waqas A. Khatri

	ANSON INVESTMENTS MASTER FUND LP
	By:	/s/ Moce Kassim
		Moce Kassim, Director, MSV Advisors, Inc.

	THE SPECIAL EQUITIES GROUP, LLC
	By:	/s/ Jonathan Schechter
		Jonathan Schechter, Managing Member

	Brett Nesland
	/s/ Brett Nesland

	SANDOR CAPITAL MASTER FUND
	By:	/s/ John S. Lemak
		John S. Lemak, Manager

	MELECHDAVID, INC.
	By:	/s/ Mark Groussman
		Mark Groussman, President


				AUXOL CAPITAL, LLC
				By:		/s/ Robert D. Keyser
						Robert D. Keyser, Jr., Member

				Daniel W. Armstrong
				/s/ Daniel W. Armstrong

				CRANSHIRE CAPITAL MASTER FUND, LTD
				By:		/s/ Keith A. Goodman
						Keith A. Goodman, Authorized Signatory

				John R. Baleno
				/s/ John R. Baleno

				Stuart H. Smith
				/s/ Stuart H. Smith

				Barry Honig
				/s/ Barry Honig

				HS CONTRARIAN INVESTMENTS, LLC
				By:		/s/ John Stetson
						John Stetson, Managing Member

				BEBE, LLC
				By:		/s/ Erick Richardson
						Erick Richardson, Managing Member

				Ramnarain Jaigobind
				/s/ Ramnarain Jaigobind

				HUDSON BAY MASTER FUND LTD.
				By:		/s/ Sander Gerber
						Sander Gerber, Authorized Signatory

				HUDSON BAY IP OPPORTUNITIES MASTER FUND LP
				By:		/s/ Sander Gerber
						Sander Gerber, Authorized Signatory

EXHIBITS


Exhibit

Exhibit A		Schedule of Investors

Exhibit B		Stockholders’ Agreement

Exhibit C		Proxy Statement

Exhibit D		Capitalization Table

Exhibit E		Additional Risk Factors

Exhibit 31.1

CERTIFICATIONS

I, J. David Hansen, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Telik, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2014

/ S / J. D AVID H ANSEN

J. David Hansen

President and Chief Executive Officer

Exhibit 31.2

CERTIFICATIONS

I, Gregory P. Hanson, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Telik, Inc.;

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2014

/ S / G REGORY P. H ANSON

Gregory P. Hanson

Chief Financial Officer

(Principal Financial and Accounting Officer)

Exhibit 32.1

CERTIFICATION

Pursuant to the requirement set forth in Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. § 1350), J. David Hansen, the President and Chief Executive Officer of Telik, Inc. (the “Company”), and Gregory P. Hanson, Chief Financial Officer of the Company, each hereby certifies that, to the best of his or her knowledge:

1. The Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2014, to which this Certification is attached as Exhibit 32.1 (the “Periodic Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act; and

2. The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

In Witness Whereof , the undersigned have set their hands hereto as of the 8 ^th day of August, 2014.


/ S / J. D AVID H ANSEN				/s/ G REGORY P. H ANSON
J. David Hansen				Gregory P. Hanson
President and Chief Executive Officer				Chief Financial Officer
(Principal Executive Officer)				(Principal Financial and Accounting Officer)

This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Telik, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.