Exhibit 10.39

This is an agreement between MedicaLogic/Medscape, Inc. (“Medscape” or “the
Company”), and the following individual (“Executive”):

Name: Kevin Hutchinson Address 42 Hendrie Ave   Riverside, CT 06878

Background. Medscape has offered you employment as an executive of the company,
and you have indicated your intent to accept our offer. In consideration of your
continued employment by Medscape, you agree to the terms contained in this
document.

Employment. This document is your employment agreement Medscape hereby employs
you as Chief Operating Officer. You agree to perform the job assigned to you in
a careful and workmanlike manner and to abide by and enforce all rules
established by Medscape.

Compensation.  Medscape will pay you a base salary at the rate of $250,000.00
per year, payable in accordance with Medscape’s standard payroll policy. Any
future increase in your base salary will be in the sole discretion of the
Compensation Committee of the Board of Directors of Medscape. In addition to
your base salary, in each year following the first full calendar year of your
employment, Medscape will pay you an annual bonus if, in the judgment of the
Compensation Committee, the qualifying criteria established by that Committee
for payment of a bonus are met. Payment of a bonus is not guaranteed. If you
have joined the Company prior to October 1st of a calendar year, you may also be
eligible for payment of a pro-rated bonus for that year subject to the foregoing
criteria. In addition, you will be entitled to such benefits as are generally
provided to senior executives of Medscape. Your rights with respect to stock
options will be covered in separate Stock Option Agreements for each grant.

Services.  During normal business hours or, if applicable, the hours you are
scheduled to work for Medscape, you agree to devote your full time, attention
and energy to our business, and not to engage in any other business activity
during that time without the prior written approval of Medscape.

Conflict of Interest.  As a publicly-traded company, Medscape takes steps to
protect its shareholders from problems caused by conflicts of interest. You must
report any conflicts, or anything which might appear to be a conflict, to the
General Counsel of Medscape. Examples of potential conflicts include, among
other things significant investments in, or consulting services for, competing
companies, gifts (other than gifts customary in a particular business, such as
pens or shirts bearing a corporate logo) or loans or excessive payments for your
services from business partners or customers, or engaging in any activity that
may reflect adversely on Medscape's business, operations or reputation. In any
conflict of interest situation, Medscape may require you to take measures to
protect the Company’s interests, which may include declining to participate in
the activity that created the conflict or returning payments, gifts or loans.

Confidential Information. In your performing your job, you will have access to
valuable and confidential information belonging to Medscape. Examples of
confidential information include, among other things, specialized business
techniques, methods, business plans and strategies, ideas, client/account lists,
member lists, and employee lists.  You acknowledge that it cost us a lot of
time, effort and money to develop our confidential information and materials,
and that this information and material constitutes a valuable trade/business
secret and special asset of Medscape. You agree not to disclose our confidential
information and materials to any third party during the term of your employment
and for two years afterwards, except as we may specifically authorize you in
connection with the business of Medscape. Even in cases where we authorize
disclosure (for example, to consider a possible business transaction with
another company), you agree to use your best efforts to minimize any risks of
inappropriate disclosure of the information through use of nondisclosure
agreements and careful handling of materials. Regardless of whether you remain
our employee, you may never disclose information that constitutes a trade secret
of Medscape.

Goodwill.  You acknowledge that the business of Medscape depends on the
confidence Medscape’s clients and customers. You agree that any goodwill that
you develop because of your work with Medscape is the property of Medscape, and
not of you personally.

Term. This agreement will expire on the third anniversary of its signing, unless
either of us terminates your employment prior to that date. If you remain an
employee of Medscape after the third anniversary of signing, your employment
will become “at will.”

Termination of Employment.  You may terminate your employment with us at any
time by providing us with written notice of your resignation. We may also
terminate your employment at any time and for any reason by providing you with
written notice. Your employment with us will also terminate in the event of your
death or Disability (as defined below). In the event that your employment is
terminated other than as described below in the paragraph captioned “Severance
Pay,” you or your estate, as the case may be, will be entitled only to your
accrued and unpaid base salary as of the date of termination. All other benefits
will cease as of the effective date of your termination (unless otherwise
required by law).

Survival of Terms. Your obligations under the following sections of this
agreement will survive both termination of the agreement and termination of your
employment for any reason: Confidential Information, Goodwill, Termination
Obligations, Ownership of Intellectual Property, and Miscellaneous. In addition,
if this agreement is in effect upon the date of termination of your employment,
your rights under the section entitled Severance Pay, and Medscape’s rights
under the section entitled Restrictive Covenants, will survive termination of
your employment according to their terms.

Disability. “Disability” means a mental or physical condition that renders you
incapable of performing your duties and obligations under this agreement for a
period of six consecutive months, or more than 210 days in any eight month
period, in the written opinion of a competent physician specializing in such
condition selected by the Board of Directors who has personally examined and
evaluated your condition.  Medscape shall have the right to terminate your
employment at any time following your Disability.

Severance Pay. During the term of this agreement, if Medscape undergoes a
Corporate Change (defined below) and Medscape subsequently terminates your
employment (within the three year period from the date of this agreement) for
other than Good Cause (defined below), you will receive as severance pay a lump
sum amount equal to six month’s base salary (not including bonus) based on your
salary as of the date of termination. You will not be entitled to any other
payment, and all other benefits will cease as of the effective date of your
termination (unless otherwise required by law).The severance pay will be payable
within a reasonable amount of time following your termination, and will be
contingent upon your execution of a release of claims in favor of Medscape.

• “Corporate Change” shall mean any circumstance in which (i) Medscape is not
the surviving entity in any merger, consolidation or other reorganization (or
survives only as a subsidiary of an entity other than a previously wholly-owned
subsidiary of Medscape), (ii) Medscape sells, leases or exchanges or agrees to
sell, lease or exchange all or substantially all of its assets to any other
person or entity (other than a wholly-owned subsidiary of Medscape), (iii)
Medscape is to be dissolved and liquidated, (iv) any person or entity, including
a "group" as contemplated by Section 13(d)(3) of the Securities Exchange Act of
1934, acquires or gains ownership or control (including, without limitations
power to vote) of more than 50% of the outstanding shares of Medscape’s voting
stock (based upon voting power), or (v) as a result of or in connection with a
contested election of directors, the persons who were directors of Medscape
before such election shall cease to constitute a majority of the Board of
Directors of Medscape. • “Good Cause” shall mean (i) serious misconduct,
including but not limited to misconduct harmful to the interests of Medscape
which causes economic damage to the us (for example, misappropriation of
Medscape funds), (ii) conduct which significantly interferes with the
individual's ability to perform their duties (for example, abuse of alcohol or
illicit drugs, or criminal or immoral acts that damage Medscape or its
reputation), (iii) a finding of disability as provided in this Agreement under
the section on Disability, or (iv) a material breach by you of this agreement
that is not substantially cured within 30 days after receipt of written notice
from Medscape of the breach. A determination that an employee’s termination by
the Company was for Good Cause may only be made by the Company's Compensation
Committee or the Board of Directors, which must prepare minutes of its meeting
listing the reasons that Good Cause has been established. • Any action by the
Company or its successors following a Corporate Change that (i) significantly
reduces the scope or nature of the authority, powers, functions or duties of the
Executive, (ii) lowers the Executive’s base salary by any amount, or (iii)
reduces by one level or more the grade represented by the Executive’s
then-current title and reporting line shall be deemed a termination of the
Executive for the purposes of this section.

Restrictive Covenants.  As long as this agreement remains in effect, during your
employment with Medscape, you will not: (a) directly or indirectly, either as an
employee, consultant, agent, principal, partner, stockholder, corporate officer,
director, or in any other individual or representative capacity, engage or
participate in any business or organization that is directly competitive with
the business of Medscape; (b) solicit, divert or take away, or attempt to
solicit, divert or take away, the business of any clients, customers or accounts
of Medscape (except on behalf of a business unrelated to the business of
Medscape); or (c) encourage or solicit any employee to leave the employ of
Medscape for any reason.  If you are terminated for Good Cause or under any
circumstances which entitle you to severance pay under this agreement, the
restrictions under (b) and (c) only will also apply for six months after your
termination date. If you are in violation of these restrictions, the six month
time period will cease to run during the period of your violation, and will
resume once the violation has been cured. You acknowledge that these
restrictions are necessary for the protection of the business and goodwill of
Medscape and are reasonable.  You acknowledge that any breach of these
restrictions is likely to cause Medscape substantial and irreparable damage and
therefore, in the event of any such breach, Medscape will be entitled to
specific performance and injunctive relief in addition to any other remedies
that may be available, without proving actual damages.

Medscape Employee Policies. You acknowledge that you have had an opportunity to
review the current employee policies of Medscape. We may change the our employee
policies at any time without prior notice. You specifically acknowledge that you
have read, and you agree to abide by, Medscape policies regarding equal
employment opportunity and sexual harassment, and that failure to follow these
policies is a material breach of this Agreement. We do not intend that any
communications we have with you, other than this agreement, confer on you any
legally enforceable rights unless they are a formal written amendment to this
agreement signed by both of us.

Insider Trading. You agree not to misuse or disclose to outsiders any
confidential information of Medscape that might enable you or others to make
money in the stock market.  If you have access to non-public knowledge about
Medscape or potential Medscape business partners, you may not use this
information for personal gain. If you hear any rumors regarding the Medscape or
its stock or its dealings with any other publicly-traded corporation which might
affect the stock of either corporation, you should report them to the General
Counsel as soon as possible. If you are a named “executive officer” of Medscape,
you must comply with our insider trading policy, as amended from time to time by
our Board of Directors, and you will also be required to report your
transactions in Medscape stock to the federal government. Although we retain an
outside consultant to assist you with these required filings, you acknowledge
that the ultimate responsibility for the making the filings in a timely and
accurate fashion and for complying with the laws regarding insider trading
resides with you.

Authority.  You may not enter into agreements on behalf of Medscape, or take any
other actions in our name, unless you are authorized to do so under our
signature authority, external communications, and other relevant policies.

Termination Obligations. If you leave Medscape, you agree to return to us, as
promptly as possible, any materials, equipment, or money that belongs to us (for
example, correspondence, contracts, reports, price lists, manuals, mailing
lists, client/account lists, advertising materials, contacts, credit cards,
petty cash, checks, supplies, computer equipment, software, and files).
Materials that you created using Medscape’s equipment and in the course of your
employment as part of your job duties belong to us. Furthermore, after
termination, you may not use our name in any public statements about your
employment with us that are intended for wide distribution or announcement
unless you receive our written permission. This restriction is not intended to
prohibit you from using our name as part of your employment history in a resume,
biography, or similar document, regardless of how widely that document may be
distributed.

Ownership of Intellectual Property.  You agree that any materials you produce as
a result of your employment are “works for hire,” and you assign all your rights
in these materials, including copyright and any moral or artists’ rights, to
Medscape. You agree that Medscape will have complete title to (a) any invention
or improvement that you make or reduce to practice while employed by us that
relates in any way to our business or to our services, materials, procedures or
methods, and (b) any idea, information or conception that you devise or suggest
for Medscape’ use while employed by Medscape. You agree to reasonably cooperate
with us in making any filings necessary to protect Medscape’s rights in such
materials or inventions.

Miscellaneous.

1. You agree that any violation by you of our agreement would result in
irreparable damage to Medscape, and you agree that in such a case we are
entitled (at a minimum) to an injunction to restrain your violation. We remain
entitled to any other remedies under law.     2. If a court holds any term of
our agreement unenforceable, then it is our mutual intent that the court either
limit that term in a way that makes it enforceable (for example, by reducing a
time period), or sever that term from the agreement while enforcing the other
terms.     3. We may waive any terms of our agreement with respect to a
violation by you without waiving our right to take action based on future
violations (even if they are of the same type).     4. This agreement requires
your personal services, and you agree not to assign it to any other person. 
Medscape, however, may assign the agreement to any of our affiliates, divisions,
or successors.     5. We both agree that this document constitutes the sole and
complete agreement between us relating to the subject matter hereof.  Neither of
us may make any modifications to our agreement except in writing.

Your signature below indicates that you have read and understood the terms of
this document, and that you agree to them as a condition of your employment by
Medscape.

MEDICALOGIC/MEDSCAPE, INC.

 

By:    

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Name: Mark Boulding Title: General Counsel, Executive Vice President and
Secretary

 

Employee:    

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  Kevin Hutchinson     Dated as of June 18, 2001.