Exhibit

10.7A




 




AMENDMENT

AGREEMENT




 




This Amendment Agreement between Ostex

International, Inc. (the “Company”), a Washington corporation, and Thomas A.

Bologna (“Executive”) is dated and entered into as of February 10, 1998.




 




RECITALS




 




A.            The

parties entered into an Executive Employment Agreement dated as of

July 16, 1997 providing for the employment of Executive by the Company.




 




B.            The

parties entered into a Stock Option Agreement evidencing a stock option grant

from the Company to Executive on July 16, 1997 (the “Stock Option Agreement”).




 




B.            The

parties now desire to amend the Employment Agreement and Stock Option

Agreement, upon the terms set forth herein.




 




AGREEMENT




 




Therefore, it is agreed as follows:




 




1.             Employment

Agreement.  The Employment Agreement

shall be amended by deleting the third sentence of Section 5.4 thereof.  Therefore, page 4 containing Section 5.4 of

the Employment Agreement shall be restated in the form attached hereto as

Exhibit A and inserted as a substitute page in the existing Employment

Agreement.




 




2.             Stock

Option Agreement.  The Stock Option

Agreement shall be amended by deleting the third and fourth sentences of the

paragraph entitled “Vesting.” 

Therefore, page 1 containing the “Vesting” paragraph shall be restated

in the form attached hereto as Exhibit B and inserted as a substitute page in

the existing Stock Option Agreement.




 





























 




IN WITNESS WHEREOF, the parties have executed and

entered into this Amendment No. 2 as of the date set forth above.




 




	

   


  	

  EXECUTIVE


  
	

   


  	

   


  
	

   


  	

   


  
	

   


  	

  /s/ Thomas A. Bologna


  	

   


  
	

   


  	

  Thomas A. Bologna


  
	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  
	

   


  	

  COMPANY:


  
	

   


  	

   


  
	

   


  	

  OSTEX

  INTERNATIONAL, INC.


  
	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  
	

   


  	

  By


  	

  /s/ Thomas J. Cable


  	

   


  
	

   


  	

   


  	

  Thomas J. Cable


  
	

   


  	

  Its


  	

  Chairman


  	

   


  
					





 





























 




EXHIBIT

A




 




(including utilities, telephone and similar expenses), such leases to

be subject to the Company’s approval (iii) limited moving expenses, and (iv)

temporary living accommodations in Seattle until an apartment is rented.  The Company and the Executive shall agree on

a budget for such expenses as soon as practicable after the date of this

Agreement and shall initial such final budget to acknowledge the agreed levels

of expenses.  To the extent that such

reimbursement or direct payment shall be treated as taxable income, the

Executive shall receive a “gross up” bonus to compensate the Executive for any

and all income taxes that the Executive may be required to pay with respect to

such reimbursement and gross up bonus (whenever such taxes may be assessed or

paid).  The Executive shall report all

such reimbursement and “gross up” bonuses as ordinary income for income tax

purposes.  Upon termination of

Executive’s employment, if Executive so requests, the Company shall reimburse

the Executive for the reasonable expense of relocating to San Diego (or another

location designated by Executive within the United States) and shall assume any

lease which Executive may have entered into in Seattle.




 




5.4          Stock Options




 




Simultaneously herewith, the Company has

granted options to purchase 700,000 shares of Common Stock to the Executive

under the authority of its Amended and Restated 1994 Stock Option Plan and

pursuant to the terms and conditions of the Stock Option Agreement dated

July 16, 1997 between the parties (the “Stock Option Agreement”).  Annually, the Board of Directors shall

consider, at its sole discretion, granting additional stock options to the

Executive.  The Company represents and

warrants to the Executive that all stock options (both incentive stock options

and nonqualified stock options) it has granted under the 1994 Stock Option Plan

have contained a provision that vested options will terminate upon the

expiration of 90 days from the date of an optionee’s termination of employment

or contractual relationship with the Company for any reason other than death or

disability.




 




5.5          Insurance




 




During the term of the Executive’s

employment, the Company will obtain term life insurance on the life of the

Executive, which insurance will provide for the payment of an amount equal to

the Base Salary for one year (or an amount equal to two times the Base Salary following

a Change in Control) to the Executive’s spouse in the event of the Executive’s

death; provided that the Company may obtain such




 




 





























 




EXHIBIT B




 




OSTEX INTERNATIONAL, INC.




 




AMENDED AND RESTATED 1994 STOCK OPTION PLAN




 




STOCK OPTION AGREEMENT




 




	

  To:  Thomas

  A. Bologna


  	

   


  	

  Date of Grant: 

  July 16, 1997


  





 




We are pleased to inform you that you have

been granted a stock option for the purchase of shares of common stock of Ostex

International, Inc., a Washington corporation (the “Company”), under the

Amended and Restated 1994 Stock Option Plan (the “Plan”).  The terms of this option are as set forth in

the Plan and in this Agreement and the Plan is incorporated into this Agreement

by reference.  The most important of the

terms are summarized as follows:




 




	

  Number of Shares:  700,000


  	

   


  	

  Exercise Price:  $3.125


  
	

   


  	

   


  	

   


  
	

  Term:  Ten

  years


  	

   


  	

   


  





 




Vesting:  This option will

vest and become exercisable with each month of continuous employment in equal

monthly installments over a four–year period, commencing July 16,

1997; provided, however, that this option shall automatically accelerate so

that this option shall become 100% vested and exercisable upon your death or

disability at any time after you have been continuously employed by the Company

for at least two years.In the event of any Change in Control (as defined in

Section 5.14.1 of the Plan), this option shall automatically accelerate so

that this option shall, immediately prior to the specified effective date for

the Change in Control, become 100% vested and exercisable.




 




Type

of Option.  This

option shall constitute an incentive stock option, except to the extent any

portion of this option fails to qualify as an incentive stock option under

Section 422(d) of the Code, as reflected in the next succeeding paragraph,

which portion shall constitute a nonqualified stock option.




 




ISO

Qualification:  On

the date of grant of this option, Section 422(2) of theCode provides that, to

the extent that the aggregate fair market value of the shares with respect to

which an option is exercisable for the first time by you during any calendar

year (under this option and all other incentive stock options you hold) exceeds

$100,000, the excess portion will be treated as a nonqualified stock option,

unless the Internal Revenue Service changes the rules and regulations governing

the $100,000 limit for incentive stock options.