Re: Transition and Release Agreement

Exhibit 10.20

TELIK, INC.

June 12, 2009

Dr. Stefan Ryser, Ph.D

c/o Telik, Inc.

3165 Porter Drive

Palo Alto, CA 94304

Dear Dr. Ryser:

This letter sets forth the terms and conditions of the transition and release agreement (the “ Agreement ”) that Telik, Inc. (the “ Company ”) is offering to you.

1.    Resignation of Employment.

(a)    Transition Period. You will resign, and the Company hereby accepts your resignation, as an employee of the Company effective August 1, 2009 (the “ Transition Date ”). From the Effective Date of this Agreement (as defined in Section 13(b) (ADEA Waiver) hereof) through the Transition Date (the “ Transition Period ”), you will continue to serve as an employee of the Company pursuant to the terms of your August 1, 2008 employment offer letter agreement with the Company (the “ Employment Agreement ”) and shall assist the Company, as reasonably requested from time to time, in transitioning your responsibilities and outstanding projects to other Company personnel. Except as expressly provided this Agreement, you will no longer serve the Company or any affiliated entity in any office or capacity after the Transition Date.

(b)    Proprietary Information. You acknowledge and agree to abide by your obligations under your Proprietary Information and Inventions Agreement with the Company, a copy of which is attached as Exhibit A hereto (the “ Confidentiality Agreement ”), as well as any other confidentiality obligations applicable to you pursuant to any written agreement between you and the Company and/or under applicable law.

(c)    Final Salary and Paid Time Off. On the Transition Date, the Company will pay you all accrued salary and accrued but unused paid vacation earned by you through the Transition Date, less applicable withholdings and deductions.

(d)    Expense Reimbursements. You agree that, within thirty (30) days after the Transition Date, you shall submit your final documented expense reimbursement statement reflecting all business expenses you incurred through the Transition Date, if any, for which you seek reimbursement. The Company will reimburse you for these expenses pursuant to its regular business practice.

2.    Stock Options.

(a)    Employment-Related Option. In connection with your employment with the Company, you were granted an option (the “ Option ”) to purchase 325,000 shares of Company common stock pursuant to the terms of the Company’s 2000 Equity Incentive Plan, as amended from time to time (the “ Plan ”), and stock option grant notices and agreements issued to you (collectively with the Plan, the “ Stock Documents ”). Pursuant to the Stock Documents, 75,000 shares subject to the Option were to become vested upon achievement of specified performance objectives (the “ Performance-Based Shares ”); the remaining 250,000 shares (the “ Time-Based Shares ”) were to vest over a four-year period, with twenty-five percent (25%) of the Time-Based Shares becoming vested upon your completion of one (1) year of continuous service with the Company, and the remaining vesting in equal monthly installments for each month of your continuous service thereafter. The shares subject to the Option shall continue to vest through the Transition Date in accordance with the current vesting schedule, at which time they will cease vesting.

(b)    Director Options. In connection with your service as a non-employee director of the Company, you were granted options (the “ Director Options” ) to purchase 65,000 shares of the Company’s common stock pursuant to the terms of the Company’s 2000 Non-Employee Directors’ Stock Option Plan, as amended from time to time (the “ Director Plan ”), and stock option grant notices and agreements issued to you (collectively with the Director Plan, the “ Director Stock Documents” ). The Director Options shall continue to vest through the Transition Date in accordance with the applicable vesting schedules set forth in the Director Stock Documents, at which time they will cease vesting. Except to the extent modified herein, the Director Options shall continue to be governed by the terms and conditions set forth in the Director Stock Documents.

3.    Severance Benefits. Provided that you (a) sign this Agreement and remain employed with the Company pursuant to its terms through August 1, 2009, and (b) sign and allow to become effective the Transition Date Release attached hereto as Exhibit B , the Company shall provide you with the severance benefits described below. You must sign the Transition Date Release on or within 21-days after the Transition Date (but not before the Transition Date), and allow the Transition Date Release to become effective by its terms to receive any of these benefits.

(a)    Relocation Benefits. The Company shall forever waive any obligation on your part to reimburse the Company for the Relocation Bonus (as defined in the Employment Agreement) provided to you in connection with your employment with the Company. In addition, the Company shall pay you a lump sum relocation assistance payment of $40,000, less applicable withholdings and deductions (the “ Relocation Assistance Payment ”), to support you in relocating back to the New York area. The Relocation Assistance Payment will be paid on the first Company payroll pay date after your employment ends and you have satisfied the Transition Date Release requirement described above.

(b)    COBRA. Your group health insurance coverage will end on the last day of the month in which the Transition Date occurs (i.e., August 31, 2009). To the extent provided by the

federal COBRA law or, if applicable, state insurance laws, and by the Company’s current group health insurance policies, you will be eligible to continue your group health insurance benefits after that date at your own expense. You will be provided additional information about your health insurance continuation rights under separate cover on or shortly after the Transition Date. Provided you timely elect to continue your health insurance benefits after the Transition Date pursuant to the federal COBRA law or, if applicable, state insurance laws, and by the Company’s current group health insurance policies, as additional compensation for the Services, the Company shall pay all premiums necessary to maintain your current level of medical, dental and vision insurance coverage in effect through the end of the Consulting Period (as defined in Section 4(a) herein) or until such earlier date as you secure replacement health, dental and vision insurance coverage through a subsequent employer. You agree to notify the Company as soon as possible after you secure such replacement coverage.

4.    Consulting Services Agreement. Provided that you (a) sign this Agreement and remain employed with the Company pursuant to its terms through August 1, 2009, and (b) sign and allow to become effective the Transition Date Release attached hereto as Exhibit B as provided in Section 3, then the Company will retain you as a consultant on the terms and conditions set forth below.

(a)    Consulting Period. You shall serve as a consultant to the Company from August 2, 2009 through March 31, 2010 or until such earlier date as the consulting arrangement is terminated as provided herein (the “ Consulting Period ”).

(b)    Consulting Services. As a consultant, you will be responsible for providing advice and analysis and other assistance and services with respect to strategic matters as reasonably requested by the Company from time to time (collectively, the “ Services ”). You agree to make yourself available for up to 20 hours each month to perform the Services, and agree to exercise the highest degree of professionalism and utilize your expertise and creative talents in performing the Services. The Services shall be assigned to you by Cynthia M. Butitta, the Company’s Chief Operating Officer and Chief Financial Officer, who will also serve as your primary Company contact in your consultant role.

(c)    Fees. The Company will pay you consulting fees (“ Fees ”) of $27,083.33 month for the Services during the Consulting Period (with Fees for any partial month of Services prorated based on the number of days of Services provided). The Fees will be paid (via direct deposit to your designated bank account) on or before the last day of each month (e.g., payment for August will be made on August 31, 2009). The Company will not make any withholdings from the Fees and will issue you an IRS Form 1099 with respect to all Fees paid to you for the Services. The Company will not make payments for state or federal tax or social security; make unemployment insurance or disability insurance contributions; or obtain workers’ compensation insurance for you. You hereby agree to accept exclusive responsibility for complying with all applicable local, state and federal laws governing self-employed individuals, including obligations such as payment of taxes, social security, disability and other contributions based on the Fees. You further agree to indemnify and hold harmless the Company against any and all liabilities to any taxing authority for any taxes, interest or penalties arising in any way from the Fees.

(d)    Expense Reimbursement. The Company will reimburse you for all documented business expenses reasonably incurred in the course of performing the Services, pursuant to its established expense reimbursement policies and procedures in effect from time to time; provided, however, that you agree that you will not incur any expense in excess of $100 without the Company’s advance written consent.

(e)    Independent Contractor Relationship. Your relationship with the Company during the Consulting Period shall be that of an independent contractor of the Company, and not an employee of the Company. Accordingly, you will not be entitled to receive any of the benefits the Company provides to its employees generally. You will have no responsibilities or authority as a consultant to the Company other than as specifically provided in this Agreement. You shall not have any authority to enter into any agreement or make any representation binding upon the Company during the Consulting Period, and agree not to do so unless expressly authorized by the Company, in writing, to do so.

(f)    Proprietary Information. During the Consulting Period, you may receive and develop confidential and proprietary information relating to the Company’s business practices, strategies and technologies (collectively, the “ Information ”). You acknowledge the confidential and secret character of the Information, and agree that the Information is the sole, exclusive and valuable property of Company. Accordingly, you agree: (i) not to use, disclose or reproduce any of the Information without the applicable prior written consent of the Company, (ii) not to use the Information except in the performance of your authorized duties for the Company, and (iii) not to disclose all or any part of the Information in any form to any third party. Upon the termination of the Consulting Period or upon the Company’s earlier request, you agree to cease using and to return to the Company all whole and partial copies, reproductions, and derivatives of the Information, whether in your possession or under your direct or indirect control. Additionally, you hereby agree that any and all ideas, improvements, inventions and works of authorship conceived, written, created or first reduced to practice in your performance of the Services shall be the sole and exclusive property of the Company and you hereby assign to the Company all rights, title and interest in and to any and all such ideas, improvements, inventions and works of authorship. The foregoing obligations shall be in addition to all continuing duties applicable to you under your Confidentiality Agreement, and any other confidentiality obligations applicable to you pursuant to any written agreement between you and the Company, and/or under applicable law.

(g)    Early Termination. The Consulting Period may be terminated by you, at any time for any reason, upon thirty (30) days’ advance written notice to the Company. The Company may terminate the Consulting Period upon any material breach by you of your obligations hereunder provided such breach is not cured within seven (7) business days after the Company issues you written notice to cure (pursuant to Section 16 of this Agreement). Upon termination of the Consulting Period, the Company shall pay you all Fees earned through the end of the Consulting Period, and shall reimburse all business expenses incurred by you in performance of the Services through that date. (Final Fees will be prorated for any partial month of service.)

(h)    Acknowledgements. You and the Company acknowledge and agree that the consulting arrangement memorialized herein is not a term or benefit required under the terms of the Employment Agreement, and does not substitute in any way for any payments paid or

otherwise payable to you under the Employment Agreement. Rather, the foregoing consulting services agreement is a new, legally binding right being created as of the date this Agreement is signed by both parties (subject to your satisfaction of the preconditions to receipt of this benefit, as set forth herein).

5.    Communications. Except as otherwise authorized or required by this Agreement, any statements or disclosures made by either party to communicate your change in status (including the reasons for your departure from the organization) shall be consistent with the text attached hereto as Exhibit C (the “ Statement ”) as well as the parties’ other obligations under this Agreement (including without limitation the obligations under Section 1(b) (Proprietary Information) and Section 11 (Mutual Nondisparagement) hereof). Notwithstanding any other provision of this Agreement, the parties acknowledge that the Company may disclose the material terms of this Agreement and publically file the Agreement as required by applicable securities laws.

6.    Quinolone-Mimetic Program Acknowledgment. If, at any time within three (3) years after the Transition Date, any scientific paper is issued by the Company (in whole or in part) with respect to its quinolone-mimetics program, the Company will identify you as a co-author of such work.

7.    No Other Compensation or Benefits. Other than any vested rights you may have in any Company-sponsored ERISA-covered benefit plan (i.e., a 401(k) plan account), you will not receive any salary, bonuses, equity interests or vesting, severance or any other form of compensation or benefit from the Company after the Transition Date except as expressly provided in this Agreement.

8.    Company Property.

(a)    General Obligations. On the Transition Date and excluding the Service Materials (defined below), you agree to return to the Company all Company documents (and all copies thereof) and other Company property in your possession or control, including, but not limited to, Company files, notes, drawings, records, plans, forecasts, lists, reports, studies, analyses, compilations of data, proposals, agreements, operational and financial information, research and development information, sales and marketing information, compensation and personnel information, specifications, code, software, databases, computer-recorded information, tangible property and equipment (including, but not limited to, computers, facsimile machines, mobile telephones, servers), credit cards, entry cards, identification badges and keys; and any materials of any kind which contain or embody any proprietary or confidential information of the Company (and all reproductions thereof in whole or in part). If you used any personal computer, server, or e-mail system to receive, transmit, store or create any Company confidential or proprietary data, materials or information in connection with your employment with the Company, within thirty (30) days after the Transition Date and excluding only Service Materials, you shall provide the Company with a computer-useable copy of all such confidential or proprietary data, materials or information, and shall permanently delete and expunge such confidential or proprietary information from those systems, and make any such system available to the Company for inspection to ensure compliance with this provision.

(b)    Service Materials. You shall be entitled to temporarily retain all Company documents, electronic files and other materials the Company expressly authorizes you in writing

to retain in order to perform your services as a consultant to the Company (collectively, the “ Service Materials ”); provided, however, that you agree to return all Service Materials to the Company at the end of the Consulting Period or such other time requested by the Company. Within thirty (30) days after the end of the Consulting Period, if you used any personal computer, server, or e-mail system to receive, transmit, store or create any Company confidential or proprietary data, materials or information in connection with the performance of your consulting services, you shall provide the Company with a computer-useable copy of all such confidential or proprietary data, materials or information, permanently delete and expunge such confidential or proprietary information from those systems, and make any such system available to the Company for inspection to ensure compliance with this provision.

(c)    Personal Documents. Notwithstanding the foregoing, after the Transition Date, you shall be entitled to retain as your personal property: (i) all agreements between you and the Company that you executed in connection with your employment with the Company; (ii) all wage statements and other payroll records issued to you, and well as documents issued to you with regard to your employee benefits with the Company; and (iii) all Company documents and information issued to you in connection with your equity interests in the Company.

9.    Noncompetition and Work Activities. In order to protect the trade secrets and confidential and proprietary information of the Company, you agree that, during the remainder of your employment with the Company and for entirety of the Consulting Period, you will not, except on behalf of the Company, directly or indirectly, whether as an officer, director, stockholder, member, manager, partner, proprietor, employee, associate, representative, consultant, or in any capacity whatsoever engage in, become financially interested in, be employed or engaged by, or render services to any other person, corporation, firm, partnership or other entity whatsoever that is competitive with or is reasonably anticipated to be competitive with the Company, nor make preparations to do so; provided , however , that you may own, as a passive investor, securities of any competitor, so long as your holdings in any one such competitor shall not in the aggregate constitute more than one percent (1%) of the securities of such competitor (computed on a fully diluted basis taking into account the possible conversion or exercise of any convertible securities, options, warrants, or convertible debt). Except as provided in the preceding sentence, you may engage in other employment, consulting or other work relationships and activities in addition to your continuing obligations to the Company as long as such relationships and activities do not unreasonably interfere with your obligations to the Company or create an actual or apparent conflict of interest, each as determined by the Company in its sole discretion which shall not be unreasonably exercised. You further agree that, during the remainder of your employment and throughout the Consulting Period, except with the Company’s advance written consent, you will not, directly or indirectly, contact or solicit any Company customers for any purpose other than authorized Company business.

10.    Non-Interference. During your employment and subsequent consulting relationship with the Company and continuing for twelve (12) months after the termination of such relationship, you agree that you will not, directly or indirectly by any means (including without limitation acting by or through any other person or entity) solicit, induce, or attempt to induce any employee, consultant, supplier, clinical investigator, clinical site, or service provider of the Company to terminate or breach any employment, contractual, or other business relationship with the Company.

11.    Mutual Nondisparagement. During the remainder of your employment with the Company and continuing at all times thereafter, you agree not to disparage the Company or any of its officers, directors, employees, shareholders, agents, products or services, in any manner likely to be harmful to it, their, his or her business, business reputation or personal reputation. The Company (through its officers and directors) agrees not to disparage you in any manner likely to be harmful to you, your business, business reputation or personal reputation. Notwithstanding the foregoing, nothing in this Agreement shall prevent any person or entity from responding accurately and fully to any request for information to which response is required by legal process.

12.    No Adverse Action/Cooperation. You agree that you will not voluntarily provide assistance, information or advice, directly or indirectly (including through agents or attorneys), to any other person or entity in connection with any claim or cause of action of any kind brought against the Company; provided, however, that this limitation shall not prevent you from pursuing a claim on your own behalf (to the extent such claim is not released by you pursuant to this Agreement or the Transition Date Release) or from providing truthful and accurate testimony when requested by the Company or required by subpoena. You further agree to cooperate fully with the Company, as requested, in connection with the Company’s actual or contemplated defense, prosecution, or investigation of any claims or demands by third parties, or other matters, arising from events, acts, or failures to act that occurred during your board service or employment with the Company. Such cooperation includes, without limitation, making yourself available upon reasonable notice, without subpoena, for interviews and truthful and accurate deposition and trial testimony. The Company will reimburse you for reasonable, pre-approved and documented out-of-pocket expenses incurred in connection with any such cooperation (excluding any forgone wages, salary or other compensation), and will reasonably accommodate your scheduling needs.

13.    Release of Claims.

(a)    Ryser Release. In exchange for the Company’s agreement to the terms set forth herein, you hereby release the Company, its successors, predecessors, parents, subsidiaries, and affiliates, and each of such entities&rsquo