Exhibit 10.44


 


[*] = Certain confidential information
contained in this document, marked by brackets, has been omitted and filed
separately with the Securities and Exchange Commission pursuant to Rule 24b-2
of the Securities Exchange Act of 1934, as amended.


July 31, 2002


Douglas H. Altschuler


2001 California Ave #403


San Francisco, California
94109


Dear Douglas:


This letter sets forth
the substance of the separation agreement (the “Agreement”) which Inhale
Therapeutic Systems, Inc. (“Inhale” or the “Company”) is offering to you to aid
in your employment transition.


1.             Resignation.  Your employment with the
Company will terminate upon the earlier (“Termination Date”) of:  (a) your commencement of full-time
employment with another employer; or (b) June 6, 2003.  You agree to notify Inhale promptly upon
your acceptance of full-time employment before May 31, 2003.


2.             Further Services.  [*]  You agree to provide, upon Company request
at any time before the Termination Date, reasonable telephone consultation
services to the Company, in order to assist with the transition of
responsibility.  Prior to the
Termination Date, you further agree to provide up to three days of personal
services, as requested by the Company, per calendar month at no additional
charge other than the usual and customary reimbursement of out-of-pocket
expenses.  The Company further agrees to
pay you $1000.00 per day of additional compensation for any personal services
beyond three days per calendar month it may request.


3.             Compensation and Benefits. 
Until the Termination Date, you will continue to accrue vacation and to
receive your current base salary (the “Salary Continuance”) and benefits,
except as follows.  To the extent
provided by the federal COBRA law, and by the Company’s current group health
insurance policies, as of the Termination Date you will be eligible to continue
your group health insurance benefits at your own expense.  Later, you may be able to convert to an
individual policy through the provider of the Company’s health insurance, if
you wish.  You will not be eligible for,
and will not receive, any other form of compensation such as bonuses,
commissions or incentive compensation.


4.             Stock Options. 
You were granted one or more options to purchase shares (post-split) of
the Company’s common stock, pursuant to the Company’s 2000 Equity Incentive
Plan (the “Plan”).  Under the terms of
the Plan and your stock option grant, vesting will continue until the
Termination Date, at which time vesting will cease.  Your rights to exercise any vested shares will be as set forth in
the Plan and your option grant.


CONFIDENTIAL

















 


Douglas H. Altschuler


July 31, 2002


Page 2


 


 


5.             Voicemail and Email Access. 
You will continue to have access to the Company’s voicemail and email
facilities, including the use of the Company laptop computer, until the
Termination Date.


6.             Accrued Salary And Vacation Pay. 
On the Termination Date, the Company will pay you all accrued salary,
and all accrued and unused vacation earned through the Termination Date,
subject to standard payroll deductions and withholdings.


7.             Severance Payment. 
Although the Company has no policy or procedure for providing severance
benefits, in the event that you commence full-time employment with another
employer prior to June 6, 2003, the Company will pay you, as severance, an
amount equivalent to your base salary from the Termination Date until
June 6, 2003, subject to standard payroll deductions and withholdings
(“Severance Payment”).  The Severance
Payment, if due, will be paid in a lump sum within ten (10) days after the
Termination Date.


8.             Other Compensation or Benefits. 
You acknowledge that, except as expressly provided in this Agreement,
you will not receive any additional compensation, severance or benefits after
the Termination Date.


9.             Expense Reimbursements. 
You agree that, within thirty (30) days of the Separation Date, you will
submit your final documented expense reimbursement statement reflecting all
business expenses you incurred through the Separation Date, if any, for which
you seek reimbursement.  The Company
will reimburse you for these expenses pursuant to its regular business
practice.


10.          Return of Company Property. 
By the Separation Date, you agree to return to the Company all Company
documents (and all copies thereof) and other Company property that you have had
in your possession at any time, including, but not limited to, Company files,
notes, drawings, records, business plans and forecasts, financial information,
specifications, computer-recorded information, tangible property (including,
but not limited to, computers), credit cards, entry cards, identification
badges and keys; and, any materials of any kind that contain or embody any
proprietary or confidential information of the Company (and all reproductions
thereof).


11.          Proprietary Information Obligations. You acknowledge your continuing
obligations under your Proprietary Information and Inventions Agreement,
including but not limited to your obligation not to use or disclose any
confidential or proprietary information of the Company.  A copy of your Proprietary Information and
Inventions Agreement is attached hereto as Exhibit A.


12.          Confidentiality. 
The provisions of this Agreement will be held in strictest confidence by
you and the Company and will not be publicized or disclosed in any manner
whatsoever; provided, however,
that:  (a) you may disclose this
Agreement to your immediate


CONFIDENTIAL

















 


Douglas H. Altschuler


July 31, 2002


Page 3


 


family;
(b) the parties may disclose this Agreement in confidence to their
respective attorneys, accountants, auditors, tax preparers, and financial
advisors; (c) the Company may disclose this Agreement as necessary to
fulfill standard or legally required corporate reporting or disclosure
requirements; and (d) the parties may disclose this Agreement insofar as
such disclosure may be necessary to enforce its terms or as otherwise required
by law.  In particular, and without limitation,
you agree not to disclose the terms of this Agreement to any current or former
Company employee.


 


13.          Nondisparagement.  (a) Both
you and the Company agree not to disparage the other party, and you further
agree not to disparage the Company’s officers, directors, employees,
shareholders and agents, in any manner likely to be harmful to them or their
business, business reputation or personal reputation; and the Company further
agrees not to disparage you in any manner likely to be harmful to you or your
business, business reputation or personal reputation provided, further, that
both you and the Company will respond accurately and fully to any question,
inquiry or request for information when required by legal process.  [*]


(b)                           [*].


14.          Mandatory Arbitration. 
Both you and the Company agree that any and all disputes arising from
your or the Company’s breach or alleged breach of paragraphs 12 or 13 of this
Agreement shall be resolved, to the fullest extent permissible by law, by final
and binding confidential arbitration held in San Francisco, California through
the American Arbitration Association under its then-existing rules and
procedures.  Both you and the Company acknowledge that by agreeing to this arbitration
procedure, both you and the Company waive the right to resolve any such dispute
through a trial by judge or jury or administrative proceeding.  The arbitrator shall be authorized to award
any or all remedies that you or the Company would be entitled to seek in a
court of law.  The prevailing party in
any such arbitration shall be entitled to seek recovery of his or its
attorney’s fees and costs.  Nothing in
this paragraph is intended to prevent either you or the Company from obtaining
injunctive relief in court to prevent irreparable harm pending the conclusion
of any such arbitration.


15.          Release of Claims. 
In exchange for the Salary Continuance, COBRA Premiums, benefits
continuance, eligibility for the Severance Payment, and other consideration
under this Agreement to which you would not otherwise be entitled, and except
as otherwise set forth in this Agreement, you hereby release, acquit and
forever discharge the Company, its subsidiaries, and its and their respective
officers, directors, agents, servants, employees, attorneys, shareholders,
successors, assigns and affiliates, of and from any and all claims,
liabilities, demands, causes of action, costs, expenses, attorneys’ fees,
damages, indemnities and obligations of every kind and nature, in law, equity,
or otherwise, known and unknown, suspected and unsuspected, disclosed and
undisclosed, arising out of or in any way related to agreements, events, acts
or conduct at any time prior to and including the date you sign this Agreement,
including but not limited to:  any and
all such claims and demands directly or indirectly arising


CONFIDENTIAL

















 


Douglas H. Altschuler


July 31, 2002


Page 4


 


out of or in any
way connected with your employment with the Company or the termination of that
employment; claims or demands related to salary, bonuses, commissions, stock,
stock options, or any other ownership interests in the Company, vacation pay,
fringe benefits, expense reimbursements, sabbatical benefits, severance
benefits, or any other form of compensation; claims pursuant to any federal,
state, local law, statute or cause of action including, but not limited to, the
federal Civil Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended (“ADEA”); the federal Americans with
Disabilities Act of 1990; the California Fair Employment and Housing Act, as
amended; tort law; contract law; wrongful discharge; discrimination; fraud;
defamation; harassment; emotional distress; and breach of the implied covenant
of good faith and fair dealing.


16.          ADEA Waiver. 
You acknowledge that you are knowingly and voluntarily waiving and
releasing any rights you may have under the ADEA, as amended.  You also acknowledge that the consideration given
for the waiver and release in the preceding paragraph hereof is in addition to
anything of value to which you were already entitled.  You further acknowledge that you have been advised by this
writing, as required by the ADEA, that: 
(a) your waiver and release do not apply to any rights or claims
that may arise after the date you sign this Agreement; (b) you have been
advised hereby that you have the right to consult with an attorney prior to
executing this Agreement; (c) you have twenty-one (21) days to consider
this Agreement (although you may choose to voluntarily execute this Agreement
earlier); (d) you have seven (7) days following your execution of this
Agreement to revoke the Agreement (in writing); and (e) this Agreement
will not be effective until after the date upon which the revocation period has
expired, which will be the eighth day after this Agreement is executed by you,
provided that the Company has also executed this Agreement by that date.


17.          Section 1542 Waiver. 
In giving the release described in Paragraphs 15 and 16, above, which
includes claims that may be unknown to you at present, you acknowledge that you
have read and understand Section 1542 of the California Civil Code which reads
as follows:  “A general release does not extend to claims which the creditor does not
know or suspect to exist in his favor at the time of executing the release,
which if known by him must have materially affected his settlement with the
debtor.”  You hereby
expressly waive and relinquish all rights and benefits under that section and
any law or legal principle of similar effect in any jurisdiction with respect
to the release of unknown and unsuspected claims granted in this Agreement.


18.          Post-Death Payment.  In the event
of your death, any balance then remaining under this Agreement which has not
yet been paid shall be due and payable to your parents, Dr. Gerald and/or
Phyllis Altschuler.


19.          Miscellaneous. 
This Agreement, including its exhibit, constitutes the complete, final
and exclusive embodiment of the entire agreement between you and the Company
with regard to this subject matter.  It
is entered into without reliance on any promise or representation,


CONFIDENTIAL

















 


Douglas H. Altschuler


July 31, 2002


Page 5


written or oral,
other than those expressly contained herein, and it supersedes any other such
promises, warranties or representations. 
This Agreement may not be modified or amended except in a writing signed
by both you and a duly authorized officer of the Company.  This Agreement will bind the heirs, personal
representatives, successors and assigns of both you and the Company, and inure
to the benefit of both you and the Company, their heirs, successors and
assigns.  If any provision of this Agreement
is determined to be invalid or unenforceable, in whole or in part, this
determination will not affect any other provision of this Agreement and the
provision in question will be modified by the court so as to be rendered
enforceable.  This Agreement will be
deemed to have been entered into and will be construed and enforced in
accordance with the laws of the State of California as applied to contracts
made and to be performed entirely within California.


If this Agreement
is acceptable to you, please sign below and return the original to me.


I wish you good
luck in your future endeavors.


Sincerely,


INHALE THERAPEUTIC SYSTEMS,
INC.


	
  By:

  	
  /s/ Elizabeth Frisby

  	
   

  
	
   

  	
      
  Elizabeth Frisby

  	
   

  
	
   

  	
       Vice
  President, Human Resources

  	
   

  



 


AGREED:


 


	
  /s/ Douglas H. Altschuler

  	
   

  
	
  Douglas H. Altschuler

  	
   

  



 


	
  July 31, 2002

  	
   

  
	
  Date

  	
   

  



 


CONFIDENTIAL


 

















 


EXHIBIT A


PROPRIETARY
INFORMATION AND INVENTIONS AGREEMENT

















 


Inhale Therapeutic Systems


 


 


EMPLOYEE
AGREEMENT


 


                In
consideration of my employment or continued employment by Inhale Therapeutic
Systems, Inc. (the “Company”), I agree as of the date I was first employed by
Company as follows:


 


1.               This Agreement
supersedes any and all previous oral or written communications, discussions and
agreements between Company and me with respect to the subject of this
Agreement.


 


2.               I shall devote
my full time and best efforts during my employment with Company to the business
of Company and shall not, without the prior approval of (a) an executive
officer of the Company if I am not an executive officer of the Company, or (b)
the Board of Directors of the Company if I am an executive officer of the
Company, (i) engage in any other professional employment or consulting, or (ii)
except as appropriate in connection with my employment by the Company, directly
or indirectly participate in or assist any business which is a current or
potential supplier or customer of Company.


 


3.               During my
employment by Company and for a period of one year thereafter I shall notify
Company of any and all ideas, (including but not limited to computer programs,
software and documentation), formulae, devices, improvements, methods,
processes or discoveries related to Company’s business and/or its actual or
demonstrably anticipated research and development (“Inventions”) which I
develop, and those Inventions developed during my employment by Company shall
be the sole property of Company and I hereby assign my entire right, title and
interest in any and all such Inventions to Company, if:


 


a.               I used
equipment, supplies facilities and/or confidential and/or proprietary and/or
trade secret information of Company in developing or creating said Inventions;
and/or


 


b.              The Inventions
result, in whole or in part, from any work performed by me for Company; and/or


 


c.               The Inventions
relate at the time of conception or reduction to practice of the Inventions to
Company’s business, and/or its actual demonstrably anticipated research and
development.


 


I shall make and maintain adequate and current written
records of all Inventions, which records shall be and remain the property of
Company.

















 


 


4.               I shall not, at
any time during or following my employment by Company, disclose, other than to
Company’s authorized personnel, or otherwise use for non-Company purposes, any
confidential or proprietary information, whether business or technical, or
know-how of any nature whatsoever (whether or not a trade secret) relating to
any activity of Company, or any invention, which is owned or licensed by
Company of which has been otherwise disclosed to Company.


 


5.               I shall keep on
Company’s premises (except when required elsewhere in connection with the
conduct of Company’s business) and shall deliver to Company upon termination of
my employment all writings related to the business of Company, and all
documents, equipment, materials and other personal property belonging to
Company.  I further agree not to make or
retain any copy, duplication, facsimile, reproduction or replication of any of
the foregoing except as necessary to perform my duties as an employee of the
Company.


 


6.               I agree to
abide by, and comply with, all of the rules, regulations and policies of
Company.  I will not, in connection with
my employment by Company, use or disclose to Company any confidential, trade
secret or other proprietary information of any previous employer or other person
to which I am not lawfully entitled.


 


7.               Except for
those obligations specifically set forth in another writing signed by me and an
officer of Company (a copy of which is presented to Company with this
Agreement), I shall be under no obligation to others which restricts my right
to perform the undertakings set forth in this Agreement or which creates a
conflict with my other duties and responsibilities as an employee of
Company.  The purpose of this Paragraph
7 is solely for me to advise Company of any alleged obligations to others that
may exist and in no manner should be construed as Company’s acceptance of such
obligations (even if an officer of Company should sign this Agreement).


 


8.               I agree that
unless specifically provided in another writing signed by me and (a) an
executive officer of Company if I am not an executive officer of the Company,
or (b) another executive officer of the Company if I am an executive officer of
the company, my employment by Company is not for a definite period of time.  Rather, my employment relationship with
Company is one of employment at will and my continued employment is not
obligatory by either myself or Company.


 


9.               This Agreement
shall be construed and governed by the laws of the State of California
applicable to contracts entered into and wholly to be performed by California
residents.


 


10.         The waiver of
any breach of this Agreement shall not constitute a waiver of subsequent
similar of dissimilar breaches of this Agreement, or a waiver of any of the
obligations contained herein.


 

















 


 


11.         This Agreement
shall be binding upon the pass to the benefit of the successors and assigns of
Company.


 


12.         I recognize the
right of Company to notify any third party of the existence of this Agreement
and/or its provisions and/or my agreeing to it.


 


13.         Should a
provision or part of a provision of this Agreement be found as a matter or law
to be invalid, such finding shall not have the effect of invalidating the
remainder of this Agreement and the provision or part thereof as to which such
finding of invalidity is made shall be interpreted so as to be ineffective only
to the extent of such invalidity without invalidating the remainder of such
provision or part thereof or any of the other provisions of this Agreement.


 


 


	
  EMPLOYEE:

  	
  INHALE THERAPEUTIC
  SYSTEMS,

  
	
   

  	
  INC.:

  



 


	
  Signed:

  	
  /s/ Douglas H. Altschuler

  	
   

  	
  By:

  	
  /s/ Donald Campodonico

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   Douglas H. Altschuler

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  	
   

  	
  Human Resources

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dated:

  	
  September 14, 2001

  	
   

  	
  Dated:

  	
  September 14, 2001

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


 


ACKNOWLEDGMENT
OF NOTIFICATION


REGARDING
LIMITS ON ASSIGNMENT OF INVENTIONS


 


                I
acknowledge that by signing the Employee Agreement to which this Acknowledgment
of Notification is attached and specifically, that under the terms of Paragraph
3 of the Agreement, I have agreed that inventions, discoveries and improvements
developed by me during my employment with Company shall be the sole property of
Company and are thereby assigned to Company.


 


                I
further acknowledge that Company has notified me that under California Labor
Code Section 2870 the above-referenced Paragraph 3 of the Employee Agreement
does not apply to inventions, discoveries or improvements developed by me
during my employment with Company:


 


a.               For which no
equipment, supplies, facilities, and/or trade secret, and/or confidential
and/or proprietary information of Company was used by me; AND


 


b.              Which do not
result from any work performed by me for Company, AND


 


c.               Which do not
relate directly to the business of Company, at the time of conception or
reduction to practice of the invention, discovery or improvement and/or its
actual or demonstrably anticipated research and development.


 


Acknowledgment:


                I
hereby certify that I have read and understood the above Acknowledgment of
Notification regarding those inventions, discoveries and improvements which I
may develop during my employment with Company which do/will not become the
property of Company and for which I have made no assignment to Company under
Acknowledgment of Notification is attached.


 


 


	
  EMPLOYEE:

  	
   

  	
  /s/ Douglas H. Altschuler

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Douglas H. Altschuler

  	
   

  
	
   

  	
   

  	
  (Printed or Typewritten)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  DATED:

  	
   

  	
  September 14, 2001

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  


















 


EXHIBIT B


[*]


[*] = Certain confidential information contained in this document,
marked by brackets, has been omitted and filed separately with the Securities
and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act
of 1934, as amended.


 


CONFIDENTIAL