EXHIBIT 10.2

 

[STRESSGEN LETTERHEAD]

 

April 12, 2005

 

 

Dan Korpolinski

c/o Stressgen Biotechnologies Inc.

6055 Lusk Boulevard

San Diego, CA  92121

 

 

Dear Dan:

 

Re:                             Termination of Employment with Stressgen
Biotechnologies Inc. and Stressgen Biotechnologies Corporation

 

Further to our previous discussions, we write to confirm that the Board of
Directors of Stressgen Biotechnologies Corporation has decided to terminate your
employment as President and Chief Executive Officer with Stressgen
Biotechnologies Inc. and Stressgen Biotechnologies Corporation (collectively,
“Stressgen”) without just cause effective April 14, 2005, in accordance with the
terms of your employment agreement dated September 1, 2004 (“Employment
Agreement”).

 

However, in exchange for you agreeing to the terms and conditions set out below,
in addition to the contractual obligations set out in the Employment Agreement,
Stressgen is prepared to offer you the following:

 

1.               In lieu of the salary continuance provided for in paragraph 4.2
of the Employment Agreement, in addition to our paying you up to your last day
of work, Stressgen shall pay you a lump sum of US$672,400.00 (“Severance
Amount”), less all appropriate statutory deductions.  Payment of this amount
shall be made seven (7) days following the execution of the Confidential General
Release of All Claims attached as Schedule “B” to this letter.  On your
instructions, Stressgen is prepared, to the extent it is permitted by law to do
so, pay a portion of the Settlement Amount into your 401K account.

 

2.               Stressgen shall pay you the sum of US$48,817.00, representing
your accrued but unused vacation pay.

 

3.               In addition to the Severance Amount, Stressgen shall also pay
you a further sum of US$9,900.00, less appropriate statutory deductions,
representing reimbursement of any supplemental life insurance premiums you
potentially would have incurred during the 18 month severance period, as
contemplated in section 4.2 of the Employment Agreement.

 

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4.               Stressgen agrees to pay the premiums required to continue your
medical, dental and vision coverage for an 18 month period commencing April 14,
2005, under the applicable provisions of the Consolidated Omnibus Budget
Reconciliation Act of 1985 (“COBRA”) provided that you elect to continue and
remain eligible for these benefits under COBRA, and you do not obtain health
coverage through another employer during this period.

 

5.               Stressgen will allow you to continue to reside in its corporate
condominium in San Diego, California until the current lease for that
condominium expires in August 2005.  In the event that you decide to continue
residing at that location following the expiration of the current lease, you
will be required to enter into a new lease agreement with the landlord and will
be personally responsible for all costs associated with leasing that
condominium.

 

In exchange for the consideration set out above, Stressgen requires the
following:

 

1.               You agree to provide consulting services to Stressgen, in
accordance with the terms and conditions set out in the Consulting Services
Agreement attached as Schedule “A” to this letter.

 

2.               You confirm that you remain bound by the obligations set out in
sections 7, 8, 9, 10 and 11 of the Employment Agreement and acknowledge that
those terms and conditions survive the termination of your employment with
Stressgen.

 

3.               You agree to cancel all stock options granted to you, including
those set out below:

 

Date

 

Number of Options Granted

 

Exercise Price

 

3/31/2000

 

1,000,000

 

CDN $6.20

 

01/11/2002

 

100,000

 

CDN $5.21

 

02/05/2003

 

150,000

 

CDN $1.63

 

 

4.               You shall execute a Confidential General Release of All Claims
you may have against Stressgen in the form attached as Schedule “B” to this
letter.

 

Please consider these additional terms set out herein carefully and take
whatever legal advice you require.

 

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We would like to take this opportunity to thank you for the contributions you
have made to Stressgen, and wish you the best in your future endeavours.

 

 

Yours very truly,

 

 

 

 

 

Ian Lennox

 

Chairman of the Board

 

Stressgen Biotechnologies Corporation

 

 

Acknowledged and agreed to this            day of April, 2005.

 

 

 

 

Dan Korpolinski

 

 

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