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EXHIBIT 10.39
[ALTEON LETTERHEAD]
February 24, 1998
Xxxx X. Xxxxx, Ph.D.
000 Xxxxxxxx Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Dear Xxxx:
This letter will confirm certain matters related to your employment by Alteon
Inc. (the "Company") and shall constitute an amendment to your employment
agreement with the Company dated July 13, 1993 (The "Employment Agreement"),
as amended by letter dated July 10, 1996 (the "1996 Amendment"), and certain
other agreements you have with the Company as set forth below.
Your Term of Employment, as defined in Paragraph 1 of your Employment
Agreement, shall be extended through and including July 13, 1999.
Your Salary will continue to be $262,500 per annum and your housing allowance
of $4,500 per month will also continue. In connection with the Company's
fiscal year ending December 31, 1998, you will be eligible to receive a bonus,
pursuant to the terms of Paragraph 3 of your Employment Agreement, in an amount
of up to $50,000 in cash; provided, however, that you and the Company may agree
to substitute the award of stock options in lieu of some or all of such bonus.
On July 20, 1993, you executed a promissory note in favor of the Company in the
amount of $200,000 (the "Note") and a mortgage to secure payment of the Note
(the "Mortgage"), which Note and Mortgage were amended pursuant to the 1996
Amendment. the amendments to the Note and Mortgage enumerated in the 1996
Amendment are hereby replaced, in their entirety, as follows:
1. except as set forth below, interest on the Note will stop accruing as
of July 13, 1999
2. the principal amount of the Note, plus the amount of interest accrued
through and including July 13, 1999, shall be paid in three (3) equal
installments on the following dates: July 13, 1999; July 13, 2000;
and July 13, 2001
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XXXX X. XXXXX, Ph.D
FEBRUARY 24, 1998 PAGE 2
3. in the event any of the three (3) installment payments are not made
when due, Interest shall accrue on such unpaid amount at a rate of
one percent (1%) per month until such payment is made
You recognize that you may realize additional taxable income due to the imputed
interest rules under the Internal Revenue Code of 1986 for those tax years when
payments on the Note are deferred without the accrual interest.
Paragraph 21 of your Employment Agrement ("General") is amended to include this
letter as part of the "entire agreement," with respect to the subject matter of
your employment by the Company under the agreements included therein. Except
as modified by this letter, the terms of your Employment Agreement, the Note
and the Mortgage shall remain in full force and effect.
If the foregoing is acceptable to you, please indicate your agreement by signing
and returning the enclosed copy of this letter.
Sincerely,
/s/ XXXXX X. XXXXXX
Xxxxx X. Xxxxxx
Chairman and
Chief Executive Officer
ACCEPTED AND AGREED:
/s/ XXXX X. XXXXX
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Xxxx X. Xxxxx, Ph.D. Date
