Exhibit 10.2


 


December 29, 2008


 


Mr. Kenneth M. Bate

33 Middle Street


Concord, MA 01742


 


Dear Mr. Bate:


 


Reference is made to your retention agreement
with NitroMed, Inc. (the “Company”) dated as of January 23, 2007 (the
“Agreement”).  In all respects, the
Agreement shall remain in full force and effect, provided, however, that:


 


1.                                       It
is agreed that Section 1.1 is hereby amended and restated to add the
following clause at the end of the first sentence, before the colon: “,
provided that such event or occurrence constitutes a change in the ownership or
effective control of the Company, or a change in the ownership of a substantial
portion of the assets of the Company, as defined in Treasury Regulation §§
1.409A-3(i)(5)(v), (vi), and (vii).”


 


2.                                       It
is further agreed that paragraphs (a) through (f) of Sections 1.4 are
amended and restated in their entirety to read as follows:


 


(a)           the assignment to the
Employee of duties which result in a material diminution of the Employee’s
position (including status, offices, titles and reporting obligations),
authority or responsibilities in effect immediately prior to the earliest to
occur of (i) the Change in Control date, (ii) the date of the
execution by the Company of the initial written agreement or instrument
providing for the Change in Control or (iii) the date of the adoption by
the Board of Directors of a resolution providing for the Change in Control
(with the earliest to occur of such dates referred to herein as the “Measurement
Date”);


 


(b)           a material reduction in
the Employee’s annual base salary as in effect on the Measurement Date or as
the same was or may be increased thereafter from time to time;


 


(c)           a material change in
the location at which the Employee performs his principal duties for the
Company, provided that such new location is more than 50 miles from the
location at which the Employee performed his principal duties for the Company
immediately prior to the Measurement Date; or


 


(d)           any material breach by
the Company of this Agreement with the Employee.


 


3.                                       It
is further agreed that Section 3.2, paragraph (d) is amended and
restated in its entirety to read as follows:


 


(d)           Any Notice of
Termination for Good Reason given by the Employee must be given within 90 days
of the initial occurrence of the event(s) or circumstance(s) which
constitute(s) Good Reason.  If the
condition is capable of being corrected, the Company shall have 30 days during
which it may remedy the condition.  If
the condition is fully remedied within such time period, the event or occurrence
shall not constitute Good Reason.   If
the condition or event is not corrected, in order for the Employee to terminate
for Good Reason, the 


 

















 


Date of Termination must be
within one year after the Company fails to cure the condition or event giving
rise to the Employee’s claim for Good Reason.


 


4.                                       It
is further agreed that Section 4.4 is hereby amended and restated in its
entirety to read as follows:


 


4.4.          Payments Subject to Section 409A.  Subject to the provisions in this Section 4.4,
any severance payments or benefits under this Agreement shall begin only upon
the date of the Employee’s “separation from service” (determined as set forth
below) which occurs on or after the date of termination of employment.  The following rules shall apply with respect
to distribution of the payments and benefits, if any, to be provided to the
Employee under this Agreement:


 


(a)           It is intended that
each installment of the severance payments and benefits provided under this
Agreement shall be treated as a separate “payment” for purposes of Section 409A
of the Internal Revenue Code and the guidance issued thereunder (“Section 409A”).  Neither the Employee nor the Company shall
have the right to accelerate or defer the delivery of any such payments or
benefits except to the extent specifically permitted or required by Section 409A.


 


(b)           If, as of the date of
the Employee’s “separation from service” from the Company, the Employee is not
a “specified employee” (within the meaning of Section 409A), then each
installment of the severance payments and benefits shall be made on the dates
and terms set forth in this Agreement.


 


(c)           If, as of the date of
the Employee’s “separation from service” from the Company, the Employee is a “specified
employee” (within the meaning of Section 409A), then:


 


(i)            Each installment of
the severance payments and benefits due under this Agreement that, in
accordance with the dates and terms set forth herein, will in all
circumstances, regardless of when the separation from service occurs, be paid
within the short-term deferral period (as defined under Section 409A)
shall be treated as a short-term deferral within the meaning of Treasury
Regulation Section 1.409A-1(b)(4) to the maximum extent permissible
under Section 409A; and


 


(ii)           Each installment of the
severance payments and benefits due under this Agreement that is not described
in paragraph (i) above and that would, absent this subsection, be paid
within the six-month period following the Employee’s “separation from service”
from the Company shall not be paid until the date that is six months and one
day after such separation from service (or, if earlier, the Employee’s death),
with any such installments that are required to be delayed being accumulated
during the six-month period and paid in a lump sum on the date that is six
months and one day following the Employee’s separation from service and any
subsequent installments, if any, being paid in accordance with the dates and
terms set forth herein; provided, however, that the preceding provisions of
this sentence shall not apply to any installment of severance payments and
benefits if and to the maximum extent that that such installment is deemed to
be paid under a separation pay plan that does not provide for a deferral of
compensation by reason of the application of Treasury Regulation Section 1.409A-1(b)(9)(iii)


 

















 


(relating to separation pay
upon an involuntary separation from service). 
Any installments that qualify for the exception under Treasury
Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the
last day of the Employee’s second taxable year following the taxable year in
which the separation from service occurs.


 


(d)           The determination of
whether and when the Employee’s separation from service from the Company has
occurred shall be made and in a manner consistent with, and based on the
presumptions set forth in, Treasury Regulation Section 1.409A-1(h).  Solely for purposes of this paragraph (d), “Company”
shall include all persons with whom the Company would be considered a single
employer under Sections 414(b) and 414(c) of the Code.


 


(e)           All reimbursements and
in-kind benefits provided under this Agreement shall be made or provided in
accordance with the requirements of Section 409A to the extent that such
reimbursements or in-kind benefits are subject to Section 409A, including,
where applicable, the requirement that (i) any reimbursement is for
expenses incurred during the Employee’s lifetime (or during a shorter period of
time specified in this Agreement), (ii) the amount of expenses eligible
for reimbursement during a calendar year may not affect the expenses eligible
for reimbursement in any other calendar year, (iii) the reimbursement of
an eligible expense will be made on or before the last day of the calendar year
following the year in which the expense is incurred and (iv) the right to
reimbursement is not subject to set off or liquidation or exchange for any
other benefit.


 


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Left Blank]


 

















 


By execution of this letter,
you hereby agree to the foregoing amendment of the Agreement and reaffirm your
obligations under the Agreement.


 


Very truly yours,


 


NitroMed, Inc.


 


 


	
  By:

  	
  /s/ Mark
  Leschly

  	
   

  
	
   

  	
   Mark Leschly, Chairman, Compensation
  Committee of the Board of Directors

  
	
   

  	
   

  	
   

  
	
  Acknowledged
  and Agreed:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Kenneth
  M. Bate

  	
   

  
	
  Kenneth M.
  Bate