<PAGE>

                                 EXHIBIT 10.12
((Date))

((First Name)) ((Last Name))
((Address))
((City)),((State)) ((Postal Code))

Dear ((First Name)):

I am pleased to inform you that the Board of Directors of the Company has
determined to award you shares of the Company's common stock.  Provided that you
remain an employee of the Company in good standing, such shares will be granted
to you as follows:

                    _______ shares on ((Date))
                    _______ shares on ((Date))
                    _______ shares on ((Date))
                    _______ shares on ((Date))

These awards will be restricted stock grants under the Company's 1998 Equity
Compensation Plan and, therefore, will be subject to certain restrictions and
conditions as prescribed by the Plan.

If any change is made to the Company's common stock (whether by reason of
merger, consolidation, reorganization, recapitalization, stock divident, stock
split, combination of shares, or exchange of shares or any other change in
capital structure made without receipt of consideration), then the amount of
nature of hte shares to be granted pursuant hereto shall be subject to such
adjustment as the Board of Directors deems appropriate.

We appreciate you continued loyalty and dedication to the Company and its
future.


Sincerely,



Michael R. Dougherty
President and Chief Executive Officer
<PAGE>

                         SCHEDULE OF 1998 STOCK AWARDS
<TABLE>
<CAPTION>

                                   Date on Which Shares  Number of Shares
        Name of Employee             Will Be Granted      to Be Granted
---------------------------------  --------------------  ----------------
<S>                                <C>                   <C>
Michael R. Dougherty                 August 11, 1999               12,500
                                     August 11, 2000               12,500
                                     August 11, 2001               12,500
                                     August 11, 2002               12,500

Roy C. Levitt, M.D.                  August 11, 1999                9,000
                                     August 11, 2000                9,000
                                     August 11, 2001                9,000
                                     August 11, 2002                9,000

Michael A. Zasloff, M.D., Ph.D.      August 11, 1999                5,000
                                     August 11, 2000                5,000
                                     August 11, 2001                5,000
                                     August 11, 2002                5,000

Kenneth J. Holroyd, M.D.             August 11, 1999                5,000
                                     August 11, 2000                5,000
                                     August 11, 2001                5,000
                                     August 11, 2002                5,000
</TABLE>
<PAGE>

                         SCHEDULE OF 1999 STOCK AWARDS
<TABLE>
<CAPTION>

                                   Date on Which Shares  Number of Shares
        Name of Employee             Will Be Granted      to Be Granted
---------------------------------  --------------------  ----------------
<S>                                <C>                   <C>
Michael R. Dougherty                   July 9, 2000                 3,750
                                       July 9, 2001                 3,750
                                       July 9, 2002                 3,750
                                       July 9, 2003                 3,750

Roy C. Levitt, M.D.                    July 9, 2000                 1,875
                                       July 9, 2001                 1,875
                                       July 9, 2002                 1,875
                                       July 9, 2003                 1,875

Michael A. Zasloff, M.D., Ph.D.        July 9, 2000                 1,250
                                       July 9, 2001                 1,250
                                       July 9, 2002                 1,250
                                       July 9, 2003                 1,250

Kenneth J. Holroyd, M.D.               July 9, 2000                 1,250
                                       July 9, 2001                 1,250
                                       July 9, 2002                 1,250
                                       July 9, 2003                 1,250
</TABLE>