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Exhibit 10.33
January 30, 1997
Xx. Xxxxx X. Xxxxxx
00 Xxxx Xxxx
Xxxxxxx, XX 00000
Dear Xxx:
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 February 28, 1994 (the "Employment Agreement").
Your Term of Employment, as defined in Paragraph 1 of your Employment Agreement,
shall begin on the date hereof and terminate 3 years from such date.
Your Salary will be $300,000 per annum. In addition, at the end of each calendar
year during the Term of Employment, you will be eligible to receive a bonus,
pursuant to the terms of Paragraph 3 of your Employment Agreement, comprised of
cash in an amount of up to $50,000 and stock options. The number of options and
the vesting schedule and exercise price for these options will be agreed upon
with the Compensation Committee of the Board at the end of each calendar year.
Paragraph 19 of your Employment Agreement ("Notices") is amended to reflect your
current address as 00 Xxxx Xxxx, Xxxxxxx, Xxx Xxxx, 00000.
Subject to your acceptance of this letter, the Company shall award you options
to purchase 150,000 shares of the Company's common stock at an exercise price of
$5.375 (the fair market value of Alteon stock on December 17, 1996, when the
Compensation Committee of the Board approved this award). The options will be
subject to the terms and conditions of the Company's 1995 Stock Option Plan and
the Company's standard Incentive/Non-Qualified Stock Option Grant Agreement to
be executed after action of the Compensation Committee ("New Grant Agreement").
In addition, pursuant to your stock option grant agreement with the Company
dated March 30, 1995
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(the "Prior Grant Agreement"), the Company granted you options to purchase
500,000 shares of the Company's common stock. Under the Prior Grant Agreement,
200,000 options are subject to accelerated vesting upon the accomplishment of
certain performance related milestones, 40,000 of which have already vested. We
agree that the Prior Grant Agreement is hereby amended to reflect the following
amendment and restatement of the performance related milestones so that the
160,000 remaining milestone related options under the Prior Grant Agreement and
90,000 of the options granted under the New Grant Agreement (i.e., a total of
250,000 options) shall vest at a rate of 1/5 (or options to purchase 50,000
shares) upon the accomplishment by you and the Company of each of the following
performance related milestones:
- Gain approval of an IND on next A.G.E.-related compound
1. Raise enough capital to ensure Alteon's financial viability
through 1999
a)
2. Establish a new partnering relationship covering North America
and Western Europe on an A.G.E. inhibitor, A.G.E. breaker or
glucose lowering agent
a)
3. Elevate Alteon's market capitalization to over $250MM
a)
4. Ensure Alteon's first NDA is accepted for filing by FDA
As each milestone is accomplished, options shall vest in the following order of
priority: first, under the Prior Grant Agreement and second, under the New Grant
Agreement. Notwithstanding the foregoing, all 250,000 milestone related options
shall also vest on a date 10 years after their respective grant dates, provided
you are then employed by the Company as set forth in the Grant Agreements.
The Prior Grant Agreement granted you 300,000 options to vest at a rate of 1/60
per month over a five year period. We agree that at the end of the five year
period defined in the Prior Grant Agreement, the remaining 60,000 options under
the New Grant Agreement shall vest at a rate of 1/12 per month over the ensuing
one year period.
Paragraph 20 of your Employment Agreement ("General") is amended to include the
Prior Grant Agreement, the New Grant Agreement and this letter as part of the
"entire agreement," with respect to the subject matter of your employment by the
Company under these agreements. Except as modified by this letter, the terms of
all the foregoing enumerated agreements shall remain in full force and effect.
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If the foregoing is acceptable to you, please indicate your agreement by signing
and returning the enclosed copy of this letter.
Sincerely,
/s/ Xxxx X. Xxxxx
Xxxx X. Xxxxx
President and
Chief Operating Officer
ACCEPTED AND AGREED:
/s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
