RITA MEDICAL SYSTEMS INC
FORM OF CHANGE OF CONTROL AGREEMENT
<DOCUMENT>
<TYPE>EX-10.23
<SEQUENCE>3
<FILENAME>dex1023.txt
<DESCRIPTION>FORM OF CHANGE OF CONTROL AGREEMENT
<TEXT>
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                                                                   EXHIBIT 10.23

                           CHANGE OF CONTROL AGREEMENT

         This Change of Control Agreement (the "Agreement") is made and entered
into effective as of ____ ___, 200__, by and between _____________ (the
"Employee") and RITA Medical Systems, Inc., a Delaware corporation (the
"Company").

                                    RECITALS

         A. It is understood that another company or other entity may from time
to time consider the possibility of acquiring the Company or that a change in
control may otherwise occur, with or without the approval of the Company's Board
of Directors (the "Board"). The Board has identified the Employee, an officer of
the Company, as a key employee whose continued employment with the Company is
critical to the Company's future success and has determined that it is important
to provide Employee with an incentive to continue his or her employment with the
Company in the event that the Company consummates a Change of Control
transaction. For purposes of this Agreement, this shall include Employee's
employment in a majority-owned subsidiary or other surviving entity of an
acquiring Company.

         B. To accomplish the foregoing objectives, the Board of Directors has
directed the Company, upon execution of this Agreement by the Employee, to agree
to the terms provided in this Agreement.

         C. The Board believes that it is imperative to provide the Employee
with certain benefits upon a Change of Control and, under certain circumstances,
upon termination of the Employee's employment in connection with a Change of
Control, which benefits are intended to provide the Employee with financial
security and provide sufficient income and encouragement to the Employee to
remain with the Company notwithstanding the possibility of a Change of Control.

         D. To accomplish the foregoing objectives, the Board of Directors has
directed the Company, upon execution of this Agreement by the Employee, to agree
to the terms provided in this Agreement.

         E. Certain capitalized terms used in the Agreement are defined in
Section 3 below.

         In consideration of the mutual covenants contained in this Agreement,
and in consideration of the continuing employment of Employee by the Company,
the parties agree as follows:

            1. At-Will Employment. The Company and the Employee acknowledge that
               ------------------
the Employee's employment is and shall continue to be at-will, as defined under
applicable law. If the Employee's employment terminates for any reason,
including (without limitation) any termination prior to a Change of Control, the
Employee shall not be entitled to any payments or benefits, other than as
provided by this Agreement, or as may otherwise be available in

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accordance with the terms of the Company's established employee plans and
written policies at the time of termination. The terms of this Agreement shall
terminate upon the earlier of (i) the date on which Employee ceases to be
employed as an officer of the Company, other than as a result of an involuntary
termination by the Company without Cause, (ii) the date that all obligations of
the parties hereunder have been satisfied, or (iii) twelve (12) months after a
Change of Control. A termination of the terms of this Agreement pursuant to the
preceding sentence shall be effective for all purposes, except that such
termination shall not affect the payment or provision of compensation or
benefits on account of a termination of employment occurring prior to the
termination of the terms of this Agreement.

            2.   Change of Control.
                 -----------------

                 (a)   Stock Options and Restricted Stock.  Subject to Section 4
                       ----------------------------------
below, in the event of a Change of Control, on the effective date of the
transaction, fifty percent (50%) of all unvested options to purchase the
Company's securities held by the Employee (the "Option") prior to the effective
date of the Change of Control transaction shall become fully vested and
immediately exercisable and shall be exercisable to the extent so vested in
accordance with the provisions of the Option Agreement and Plan pursuant to
which such Option was granted and repurchase rights of the Company with respect
to fifty percent (50%) of the shares of restricted stock held by the Employee
purchased by the Employee pursuant to the terms of a Stock Purchase Agreement
shall immediately lapse. In addition, on each one month anniversary of the
effective date of the Change of Control transaction 1/12 of all remaining
unvested options held by the Employee shall become fully vested and immediately
exercisable and repurchase rights of the Company with respect to 1/12 of all
remaining shares of restricted stock held by Employee shall lapse.

                 (b)   Termination Following A Change of Control.  If the
                       -----------------------------------------
Employee's employment with the Company is involuntarily terminated at any time
within twelve (12) months after a Change of Control all unvested options held by
the Employee shall become fully vested and immediately exercisable and shall be
exercisable to the extent so vested in accordance with the provisions of the
Option Agreement and Plan pursuant to which such Option was granted and
repurchase rights of the Company with respect to all of the shares of restricted
stock held by the Employee purchased by the Employee pursuant to the terms of a
Stock Purchase Agreement shall immediately lapse.

                       (i)   Voluntary Resignation and Termination for Cause.
                             -----------------------------------------------
If the Employee voluntarily resigns from the Company or is terminated for Cause
following the Change of Control, then the Employee shall not be entitled to any
acceleration of the vesting of his or her unvested options or lapse of
repurchase rights with respect to his or her restricted stock.

            3.   Definition of Terms.  The following terms referred to in this
                 -------------------
Agreement shall have the following meanings:

                 (a)   Change of Control.  "Change of Control" shall mean the
                       -----------------
consummation of any of the following events:

                                      -2-

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                  (i)  Ownership. Any "Person" (as such term is used in Sections
                       ---------
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) is or
becomes the "Beneficial Owner" (as defined in Rule 13d-3 under said Act),
directly or indirectly, of securities of the Company representing fifty percent
(50%) or more of the total voting power represented by the Company's then
outstanding voting securities without the approval of the Board of Directors of
the Company; or

                  (ii) Merger/Sale of Assets. A merger or consolidation of the
                       ---------------------
Company whether or not approved by the Board of Directors of the Company, other
than a merger or consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or the stockholders
of the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or substantially all
of the Company's assets.

            (b)   Cause. "Cause" shall mean (i) gross negligence or willful
                  -----
misconduct in the performance of the Employee's duties to the Company where such
gross negligence or willful misconduct has resulted or is likely to result in
substantial and material damage to the Company or its subsidiaries, (ii)
repeated unexplained or unjustified absence from the Company, (iii) a material
and willful violation of any federal or state law; (iv) commission of any act of
fraud with respect to the Company; or (v) conviction of a felony or a crime
involving moral turpitude causing material harm to the standing and reputation
of the Company, in each case as determined in good faith by the Board of
Directors of the Company.

            (c)   Involuntary Termination. "Involuntary Termination" shall
                  -----------------------
include any termination by the Company other than for Cause and the Employee's
voluntary termination, upon 30 days prior written notice to the Company,
following (i) a material reduction or change in job duties, responsibilities and
requirements inconsistent with the Employee's position with the Company and the
Employee's prior duties, responsibilities and requirements, taking into account
the differences in job title and duties that are normally occasioned by reason
of an acquisition of one company by another and that do not actually result in a
material change in duties, responsibilities and requirements inconsistent with
an employee's prior position with the acquired company; (ii) any reduction of
the Employee's base and cash bonus compensation (other than in connection with a
general decrease in base salaries for most similarly situated employees of the
successor corporation); or (iii) the Employee's refusal to relocate to a
location more than 50 miles from the Company's current location.

         4. Limitation on Payments.
            ----------------------

            (a)   In the event that the severance benefits provided for in this
Agreement to the Employee (i) constitute "parachute payments" within the meaning
of Section 280G of the Internal Revenue Code of 1986, as amended (the "Code")
and (ii) but for this Section, would be subject to the excise tax imposed by
Section 4999 of the Code, then the

                                      -3-

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Employee's benefits under Section 2 shall be payable either: (i) in full, or
(ii) as to such lesser amount which would result in no portion of such severance
benefits being subject to excise tax under Section 4999 of the Code, whichever
of the foregoing amounts, taking into account the applicable federal, state and
local income taxes and the excise tax imposed by Section 4999, results in the
receipt by the Employee on an after-tax basis, of the greatest amount of
benefits under Section 2, notwithstanding that all or some portion of such
benefits may be taxable under Section 4999 of the Code. Unless the Company and
the Employee otherwise agree in writing, any determination required under this
Section 4 shall be made in writing by the Company's independent public
accountants (the "Accountants"), whose determination shall be conclusive and
binding upon the Employee and the Company for all purposes. For purposes of
making the calculations required by this Section 4, the Accountants may make
reasonable assumptions and approximations concerning applicable taxes and may
rely on reasonable, good faith interpretations concerning the application of
Section 280G and 4999 of the Code. The Company and the Employee shall furnish to
the Accountants such information and documents as the Accountants may reasonably
request in order to make a determination under this Section. The Company shall
bear all costs the Accountants may reasonably incur in connection with any
calculations contemplated by this Section 4.

            (b) The payment of severance benefits provided for in this Agreement
shall be subject to all applicable income, employment and social tax rules and
regulations.

         5. Successors. Any successor to the Company (whether direct or indirect
            ----------
and whether by purchase, lease, merger, consolidation, liquidation or otherwise)
to all or substantially all of the Company's business and/or assets shall assume
the obligations under this Agreement and agree expressly to perform the
obligations under this Agreement in the same manner and to the same extent as
the Company would be required to perform such obligations in the absence of a
succession. The terms of this Agreement and all of the Employee's rights
hereunder shall inure to the benefit of, and be enforceable by, the Employee's
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.

         6. Notice. Notices and all other communications contemplated by this
            ------
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by U.S. registered or certified mail, return
receipt requested and postage prepaid. Mailed notices to the Employee shall be
addressed to the Employee at the home address which the Employee most recently
communicated to the Company in writing. In the case of the Company, mailed
notices shall be addressed to its corporate headquarters, and all notices shall
be directed to the attention of its Secretary.

         7. Miscellaneous Provisions.
            ------------------------

            (a) No Duty to Mitigate. The Employee shall not be required to
                -------------------
mitigate the amount of any payment contemplated by this Agreement (whether by
seeking new employment or in any other manner), nor, except as otherwise
provided in this Agreement, shall any such payment be reduced by any earnings
that the Employee may receive from any other source.

                                      -4-

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            (b) Waiver. No provision of this Agreement shall be modified, waived
                ------
or discharged unless the modification, waiver or discharge is agreed to in
writing and signed by the Employee and by an authorized officer of the Company
(other than the Employee). No waiver by either party of any breach of, or of
compliance with, any condition or provision of this Agreement by the other party
shall be considered a waiver of any other condition or provision or of the same
condition or provision at another time.

            (c) Whole Agreement. No agreements, representations or
                ---------------
understandings (whether oral or written and whether express or implied) which
are not expressly set forth in this Agreement have been made or entered into by
either party with respect to the subject matter hereof. This Agreement
supersedes any agreement of the same title and concerning similar subject matter
dated prior to the date of this Agreement, and by execution of this Agreement
both parties agree that any such predecessor agreement shall be deemed null and
void.

            (d) Choice of Law. The validity, interpretation, construction and
                -------------
performance of this Agreement shall be governed by the laws of the State of
California without reference to conflict of laws provisions.

            (e) Severability. If any term or provision of this Agreement or the
                ------------
application thereof to any circumstance shall, in any jurisdiction and to any
extent, be invalid or unenforceable, such term or provision shall be ineffective
as to such jurisdiction to the extent of such invalidity or unenforceability
without invalidating or rendering unenforceable the remaining terms and
provisions of this Agreement or the application of such terms and provisions to
circumstances other than those as to which it is held invalid or unenforceable,
and a suitable and equitable term or provision shall be substituted therefor to
carry out, insofar as may be valid and enforceable, the intent and purpose of
the invalid or unenforceable term or provision.

            (f) Arbitration. Any dispute or controversy arising under or in
                -----------
connection with this Agreement may be settled at the option of either party by
binding arbitration in the County of Santa Clara, California, in accordance with
the rules of the American Arbitration Association then in effect. Judgment may
be entered on the arbitrator's award in any court having jurisdiction. Punitive
damages shall not be awarded.

            (g) Legal Fees and Expenses. The parties shall each bear their own
                -----------------------
expenses, legal fees and other fees incurred in connection with this Agreement.

            (h) No Assignment of Benefits. The rights of any person to payments
                -------------------------
or benefits under this Agreement shall not be made subject to option or
assignment, either by voluntary or involuntary assignment or by operation of
law, including (without limitation) bankruptcy, garnishment, attachment or other
creditor's process, and any action in violation of this subsection (h) shall be
void.

            (i) Employment Taxes. All payments made pursuant to this Agreement
                ----------------
will be subject to withholding of applicable income and employment taxes.

                                      -5-

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            (j) Assignment by the Company. The Company may assign its rights
                -------------------------
under this Agreement to an affiliate, and an affiliate may assign its rights
under this Agreement to another affiliate of the Company or to the Company;
provided, however, that no assignment shall be made if the net worth of the
assignee is less than the net worth of the Company at the time of assignment. In
the case of any such assignment, the term "Company" when used in a section of
this Agreement shall mean the corporation that actually employs the Employee.

            (k) Counterparts. This Agreement may be executed in counterparts,
                ------------
each of which shall be deemed an original, but all of which together will
constitute one and the same instrument.

                                      -6-

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         IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by its duly authorized officer, as of the day and year
first above written.

RITA MEDICAL SYSTEMS, INC.                  EMPLOYEE

By:_______________________                  ______________________________

Title:____________________

                                      -7-

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