Exhibit
      10.5

    


    THIS
      NOTE
      HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR APPLICABLE STATE SECURITIES LAWS. IT MAY NOT BE SOLD, OFFERED FOR
      SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
      STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS OR EVIDENCE
      REASONABLY SATISFACTORY TO THE BORROWER THAT SUCH REGISTRATION IS NOT REQUIRED.
      THE SECURITIES ISSUED UPON SUCH CONVERSION MAY NOT BE SOLD, OFFERED FOR SALE,
      PLEDGED, OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
      UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS OR EVIDENCE REASONABLY
      SATISFACTORY TO THE BORROWER THAT SUCH REGISTRATION IS NOT
      REQUIRED.

    


    


    SENIOR
      CONVERTIBLE SECURED PROMISSORY NOTE

    


    


    
      	$__________       	Parsippany, New Jersey
January 11,
              2007


    

     

     

    FOR
      VALUE
      RECEIVED, Alteon Inc., a Delaware corporation (the “Borrower”),
      located at 6 Campus Drive, Parsippany, NJ 07054, hereby promises to pay to
      _______________________ (the “Lender”),
      located at ____________________________________________, or at such other place
      as the Lender may from time to time reasonably designate, the principal sum
      of
      ______________________ ($___________) (the “Principal
      Amount”)
      in
      lawful money of the United States, in immediately available funds, ON DEMAND,
      on
      or after May 31, 2007 (the “Maturity
      Date”),
      together with any additional amounts as may be required to be paid under Section
      9 of this Note, unless the Principal Amount is earlier converted as set forth
      herein. Interest shall accrue from the date hereof until maturity (whether
      by
      demand on or after the Maturity Date or by acceleration) on the principal at
      a
      rate per annum equal to eight percent (8%), and shall be payable at maturity
      or
      upon conversion. In no event shall the rate of interest hereunder exceed the
      maximum interest rate permitted by applicable law. 

     

    1. This
      Note
      is one of several notes (the “Notes”)
      in the
      aggregate principal amount of up to $3,000,000 and of like tenor issued by
      the
      Borrower to the Lender and others (together, the “Lenders”)
      pursuant to the terms of a Convertible Note and Warrant Purchase Agreement,
      dated January 11, 2007 (the “Bridge
      Loan Agreement”).
      By
      acceptance of this Note, the Lender hereby agrees that each of the Notes issued
      pursuant to the Bridge Loan Agreement shall rank equally and ratably without
      priority over one another, and the Borrower agrees that, except as expressly
      provided by the terms of the Notes, none of the Notes shall be paid, in whole
      or
      in part, unless an equivalent, pro rata payment is made with respect to all
      other Notes.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    2. As
      security for the payment, performance and observance of the obligations set
      forth in the Notes, the Borrower has agreed to grant a security interest in
      its
      assets to the collateral agent named in, and pursuant to, that certain Security
      & Guaranty Agreement, dated January 11, 2007 (the “Security
      Agreement”).

     

    3.
       If
      this
      Note has not previously been converted, the Borrower may repay the principal
      balance of this Note plus accrued but unpaid interest, together with any
      additional amounts as may be required to be paid under Section 9 of this Note,
      without penalty, at any time prior to the Maturity Date.

     

    4. In
      the
      event that any principal or accrued interest on this Note remains outstanding
      at
      such time as the Borrower consummates a Preferred Financing (as defined below),
      the entire principal balance then outstanding plus accrued but unpaid interest
      shall automatically be converted into the securities of the Borrower issued
      in a
      Preferred Financing at a conversion rate equal to the price per security at
      which the securities are issued in a Preferred Financing and with the same
      terms
      and conditions as such securities (hereinafter, an “Automatic
      Conversion”).
      The
      Automatic Conversion will be effective upon the consummation of a Preferred
      Financing, and the Borrower shall be relieved of any continued obligation to
      repay the principal or unpaid interest on this Note thereafter. The Borrower
      shall promptly deliver to the Lender written notification of the consummation
      of
      a Preferred Financing, and the Lender shall deliver the original of this Note
      to
      the Borrower for cancellation. The Borrower shall have no obligation to deliver
      securities issuable upon a Preferred Financing until such time as it receives
      the original of this Note or an affidavit of lost security from the Lender.
      

     

    For
      purposes of this Note, “Preferred
      Financing”
shall
      mean that certain contemplated transaction or series of transactions prior
      to
      the Maturity Date in which the Borrower sells shares of its preferred capital
      stock and warrants to purchase preferred stock to the Lenders and other
      investors as the Lenders may approve, in an amount up to $20,000,000, as more
      particularly described in the Memorandum of Proposed Terms for Private Placement
      of Preferred Stock and Warrants dated as of January 4, 2007.

     

    5. In
      the
      event that any principal or accrued interest on this Note remains outstanding
      at
      such time as Borrower consummates an Equity Financing (as defined below), the
      principal balance then outstanding plus accrued but unpaid interest may be
      converted, in whole or in part, at the election of the Lender, into the
      securities of the Borrower issued in the Equity Financing at a conversion rate
      equal to the price per security at which the securities are issued in the Equity
      Financing (hereinafter, a “Voluntary
      Conversion”).
      The
      Borrower shall promptly deliver to the Lender written notification of the
      consummation of an Equity Financing, and the Lender shall have ten (10) business
      days from the date of such notice to elect, by written notice to the Borrower,
      to convert the Note. In the event the Lender elects to convert the Note into
      securities issued in the Equity Financing, the Lender shall deliver the original
      of this Note to the Borrower for cancellation together with the election notice.
      The Borrower shall have no obligation to deliver securities issuable upon a
      Voluntary Conversion until such time as it receives the original of this Note
      or
      an affidavit of lost security from the Lender. If this Note is converted in
      part, the Borrower shall reissue a Note in substantially the same form to the
      Lender reflecting the remaining principal balance.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    For
      purposes of this Note, “Equity
      Financing”
shall
      mean a transaction or series of transactions in which the Borrower sells its
      securities which occurs after the date hereof and prior to the Maturity Date
      and
      which does not constitute a Preferred Financing. 

     

    6. In
      the
      event that any principal or accrued interest on this Note remains outstanding
      prior to the Maturity Date and no Automatic Conversion or Voluntary Conversion
      has taken place, the principal balance then outstanding plus accrued but unpaid
      interest may be converted, in whole or in part, at the election of the Lender,
      into shares of the Borrower’s common stock, $0.01 per value per share
      (“Common
      Stock”),
      at a
      conversion rate equal to the closing price on the American Stock Exchange or
      the
      Nasdaq Stock Market (as reported by Bloomberg L.P. at 4:15 PM New York time))
      of
      a share of the Borrower’s Common Stock on the date hereof (hereinafter, a
“Voluntary
      Common Stock Conversion”).
      Upon
      election to consummate a Voluntary Common Stock Conversion, the Lender shall
      promptly deliver to the Borrower written notification of such election. The
      Lender shall also deliver the original of this Note to the Borrower for
      cancellation together with the election notice. The Borrower shall have no
      obligation to deliver securities issuable upon a Voluntary Common Stock
      Conversion until such time as it receives the original of this Note or an
      affidavit of lost security from the Lender. If this Note is converted in part,
      the Borrower shall reissue a Note in substantially the same form to the Lender
      reflecting the remaining principal balance.

     

    7. No
      fractional shares of capital stock of the Borrower shall be issued upon
      conversion of this Note. In lieu of any fractional shares to which the holder
      would otherwise be entitled, the Borrower shall pay cash equal to such fraction
      multiplied by the applicable conversion price.

     

    8. Unless
      and until conversion of this Note as aforesaid, the Lender shall not by virtue
      of this Note have or exercise any rights by virtue hereof as a stockholder
      of
      the Borrower.

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    9. If
      no
      Preferred Financing is consummated on or prior to the Maturity Date, and the
      Lender has not elected a Voluntary Conversion or Voluntary Common Stock
      Conversion, then (i) the entire principal amount of this Note, together with
      all
      accrued but unpaid interest, shall, at the election of the Lender, ON DEMAND,
      be
      due and payable on or after such date, (ii) the Borrower shall pay the Lender
      an
      additional sum of [_______________] ($___________)and (iii) the Borrower agrees
      to pay the Lender an amount equal to fifteen percent (15%) of the Gross Proceeds
      (defined below) to the Borrower of all Financing Transactions (defined below),
      Sale Transactions (defined below) and Product Candidate Transactions (defined
      below) completed by the Borrower on or before June 30, 2008, subject to a
      maximum additional payment under this Section 9(iii) of [_______________]
      ($___________)1 ];
      and
      provided that no amount under this clause (iii) shall be payable in the event
      of
      a Sale Transaction in which the price per share paid by the acquiror in such
      transaction equals or exceeds $0.15 (as adjusted for all subsequent stock
      splits, stock dividends, consolidations, recapitalizations and reorganizations).
      “Gross
      Proceeds”
shall
      mean (a) in the case of a Financing Transaction the amount paid by the
      purchasers of the securities in the transaction, irrespective of underwriting
      discounts, private placement commissions or other fees; (b) in the case of
      a
      Sale Transaction the sum of (i) the aggregate fair market value of any
      securities issued and any other non-cash consideration delivered (including,
      without limitation, any joint venture interest delivered to, or retained by,
      the
      Borrower), and any cash consideration paid to the Borrower or its security
      holders (including, without limitation, holders of options, warrants,
      convertible securities and preferred securities) in connection with the Sale
      Transaction, and (ii) the amount of all indebtedness and preferred stock of
      the
      Borrower or any subsidiary thereof, which is assumed or acquired by the
      purchaser or retired or defeased in connection with the Sale Transaction; and
      (c) in the case of a Product Candidate Transaction the aggregate fair market
      value of any securities issued and any other non-cash consideration delivered
      (including, without limitation, any joint venture interest delivered to, or
      retained by, the Borrower), and any cash consideration paid to the Borrower
      in
      connection with the Product Candidate Transaction. “Financing
      Transaction”
shall
      mean any equity financing by or on behalf of the Borrower or its subsidiaries,
      including, but not limited to, any sale of common stock, preferred stock,
      warrants, convertible debt or other equity linked security. “Sale
      Transaction”
shall
      mean any transaction or series of transactions in which one or more persons
      or
      entities acquires directly or indirectly a majority of the stock or all or
      substantially all of the assets, revenues, income or business of the Borrower
      or
      any subsidiary or otherwise gains control of the Borrower or any subsidiary,
      including any combination of the businesses regardless of the structure or
      form
      of the transaction. “Product
      Candidate Transaction” shall
      mean any licensing, development, commercialization, distribution, marketing,
      co-marketing, collaboration, partnering, sale, divestiture or similar agreement
      relating to the transfer of intellectual property or other rights to the
      Borrower’s current or future product candidates.

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    10. If
      (a)
      the Borrower fails to make any payment under this Note; (b) the Borrower
      breaches any representation, warranty, covenant or agreement in the Bridge
      Loan
      Agreement or any other Transaction Document (as defined in the Bridge Loan
      Agreement); (c) the Borrower fails to pay when due any Indebtedness (as defined
      in the Bridge Loan Agreement) of the Borrower in an aggregate amount of Five
      Hundred Thousand Dollars ($500,000) or greater at any one time; (d) a final
      judgment or judgments for the payment of money aggregating in excess of Five
      Hundred Thousand Dollars ($500,000) are rendered against the Borrower and which
      judgments are not, within sixty (60) days after the entry thereof, bonded,
      discharged or stayed pending appeal, or are not discharged within sixty (60)
      days after the expiration of such stay; (e) the Borrower shall be dissolved,
      become insolvent (however defined or evidenced), make an assignment for the
      benefit of creditors or make or send a notice of intended bulk transfer; (f)
      any
      petition or proceeding for any relief under any bankruptcy, reorganization,
      arrangement, insolvency, readjustment of debt, receivership, liquidation or
      dissolution law or statute now or hereinafter in effect (whether at law or
      in
      equity) is filed or commenced by the Borrower; or (g) any trustee or receiver
      is
      appointed for the Borrower or any property of the Borrower, a meeting of
      creditors is convened or a committee of creditors is appointed for, or any
      petition or proceeding for any relief under any bankruptcy, reorganization,
      arrangement, insolvency, readjustment of debt, receivership, liquidation or
      dissolution law or statute now or hereinafter in effect (whether at law or
      in
      equity) is filed or commenced against the Borrower, which proceeding is not
      dismissed within one hundred twenty (120) days (each of the foregoing, an
“Event
      of Default”),
      then
      and in any such event and at any time thereafter, the Lender may, at its option,
      declare all amounts owing under Section 9 of this Note to be due and payable,
      whereupon the maturity of the unpaid balance hereof shall be accelerated and
      the
      principal, together with all unpaid interest accrued thereon, shall forthwith
      become due and payable; provided,
      that,
      if any petition or proceeding for any relief under any bankruptcy,
      reorganization, arrangement, insolvency, readjustment or debt, receivership,
      liquidation or dissolution law or statute now or hereinafter in effect (whether
      at law or in equity) is filed or commenced by the Borrower, all amounts owing
      under this Note shall be, without notice, declaration or any action by the
      Lender, accelerated, and immediately due and payable. 

     

    11. The
      Borrower hereby waives diligence, demand, presentment, protest and notice of any
      kind, and assents to extensions of time of payment, release, surrender or
      substitution or security, or forbearance or other indulgence, without
      notice.

     

    12. No
      act,
      omission or delay by the Lender or course of dealing between the Lender and
      the
      Borrower shall constitute a waiver of the rights and remedies of the Lender
      hereunder. No single or partial waiver by the Lender of any Event of Default
      or
      right or remedy which it may have shall operate as a waiver of any other Event
      of Default, right or remedy or of the same Event of Default, right or remedy
      on
      a future occasion.

     

    13. Unless
      otherwise provided herein or in the Bridge Loan Agreement, any notice or other
      communication herein required or permitted to be given shall be in writing
      and
      may be personally served, telecopied, telexed or sent by United States mail,
      to
      Borrower or Lender, as the case may be, addressed to it at the respective
      address set forth on the first page of this Note and in the Bridge Loan
      Agreement, or at such other address as shall be designated by Borrower or
      Lender, as the case may be, in a written notice to the other party complying
      as
      to delivery with the terms of this Section 13. All such notices and other
      communications shall be deemed to have been given when (i) delivered by hand,
      (ii) sent
      by
      overnight courier, with receipt acknowledgment, or (iii) sent by certified
      mail, return receipt requested, postage prepaid.

     

    14. This
      Note
      shall be governed by and construed in accordance with the internal law of the
      State of New York (without giving effect to the conflict of laws principles
      thereof). Any legal action or proceeding with respect to this Note shall be
      brought in the courts of the State of New York or of the United States of
      America for the Southern District of New York, and, by execution and delivery
      of
      this Note, the Borrower hereby accepts for itself and in respect of its
      property, generally and unconditionally, the jurisdiction of the aforesaid
      courts. 

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    15. No
      provision hereof shall be modified, altered or limited except by a written
      instrument expressly executed by the Borrower and Lenders holding a majority
      in
      principal amount of the then outstanding Notes.

     

    16. In
      the
      event that any court of competent jurisdiction shall determine that any
      provision, or any portion thereof, contained in this Note shall be unreasonable
      or unenforceable in any respect, then such provision shall be deemed limited
      to
      the extent that such court deems it reasonable and enforceable, and as so
      limited shall remain in full force and effect. In the event that such court
      shall deem any such provision, or portion thereof, wholly unenforceable, the
      remaining provisions of this Note shall nevertheless remain in full force and
      effect.

     

    17. This
      Note
      and all obligations evidenced hereby shall be binding upon the heirs, executors,
      administrators, successors and assigns of the Borrower and shall, together
      with
      the rights and remedies of the Lender hereunder, inure to the benefit of the
      Lender, its successors, endorsees and permitted assigns.

     

    


     

    [REMAINDER
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        6

        
          

        

      

      
         

      

    

    In
      witness whereof, the Borrower has caused this Note to be executed by its duly
      elected officer as of the date first set forth above.

     

    


    ALTEON
      INC.

    


    


    


    By:
      ____________________________
Noah
      Berkowitz
President
      and Chief Executive Officer

    


    
      
         

      

      
        7