Document:

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                                                                     Exhibit 4.1

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                          STOCKHOLDERS RIGHTS AGREEMENT

                            Dated as of July 27, 1995

                                     between

                                   ALTEON INC.

                                       and

                         Registrar and Transfer Company

                                 as Rights Agent

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                                                                     Exhibit 4.1

                                TABLE OF CONTENTS

Certain Definitions............................................................1

Appointment of Rights Agent...................................................10

Issue of Rights and Right Certificates........................................10

Form of Right Certificates....................................................11

Execution, Countersignature and Registration..................................12

Transfer, Split-Up, Combination and Exchange of Right Certificates;
         Mutilated, Destroyed, Lost or Stolen Right Certificates;
         Uncertificated Rights................................................13

Exercise of Rights; Expiration Date of Rights.................................14

Cancellation and Destruction of Right Certificates............................16

Reservation and Availability of Preferred Shares..............................16

Preferred Shares Record Date..................................................18

Adjustments in Rights After there is an Acquiring Person; Exchange
         of Rights for Shares; Business Combinations..........................18

Certain Adjustments...........................................................22

Certificate of Adjustment.....................................................24

Additional Covenants..........................................................24

Fractional Rights and Fractional Shares.......................................24

Rights of Action..............................................................25

Transfer and Ownership of Rights and Right Certificates.......................26

Right Certificate Holder Not Deemed a Stockholder.............................26

Concerning the Rights Agent...................................................27

Merger or Consolidation or Change of Rights Agent.............................27

Duties of Rights Agent........................................................28

Change of Rights Agent........................................................31

Issuance of Additional Rights and Right Certificates..........................32

Redemption and Termination....................................................32

Notices.......................................................................33

Supplements and Amendments....................................................34

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                                                                     Exhibit 4.1

Successors....................................................................34

Benefits of Rights Agreement; Determinations and Actions by the
     Board of Directors, etc..................................................35

Severability..................................................................35

Governing Law.................................................................36

Counterparts; Effectiveness...................................................36

Descriptive Headings..........................................................36

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                                                                     Exhibit 4.1

         STOCKHOLDERS RIGHTS AGREEMENT (this "Rights Agreement") dated as of
July 27, 1995, between ALTEON INC., a Delaware corporation (the "Company"), and
Registrar and Transfer Company, as Rights Agent (the "Rights Agent").

         The Board of Directors of the Company has authorized and declared a
dividend of one Right (as hereinafter defined) for each share of Common Stock,
par value $0.01 per share, of the Company (the "Common Stock") outstanding at
the Close of Business (as hereinafter defined) on the date fifteen (15) days
following the date of this Rights Agreement (the "Record Date"), and has
authorized the issuance of one Right (as such number may hereafter be adjusted
pursuant to the provisions of this Rights Agreement) with respect to each share
of Common Stock that shall become outstanding between the Record Date and the
earliest of the Distribution Date, the Redemption Date or the Expiration Date
(as such terms are hereinafter defined); provided, however, that Rights may be
issued with respect to shares of Common Stock that shall become outstanding
after the Distribution Date and prior to the earlier of the Redemption Date or
the Expiration Date in accordance with the provisions of Section 23. Each Right
shall initially represent the right to purchase one one-thousandths (1/1,000ths)
of a share of Series F Preferred Stock, par value $0.01 per share, of the
Company (the "Preferred Shares"), having the powers, rights and preferences set
forth in the Certificate of Designation attached as Exhibit A.

         Accordingly, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:

         Section 1. Certain Definitions. For purposes of this Rights Agreement,
the following terms have the meanings indicated:

                  "Acquiring Person" shall mean any Person who or which, alone
or together with all Affiliates and Associates of such Person, shall be the
Beneficial Owner of more than 20% of the Common Shares then outstanding, other
than pursuant to a Qualifying Offer, but shall not include (a) the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or of any of
its Subsidiaries, or any Person holding Common Shares for or pursuant to the
terms of any such employee benefit plan or (b) any such Person who has become
such a Beneficial Owner solely because (i) of a change in the aggregate number
of Common Shares outstanding since the last date on which such Person acquired
Beneficial Ownership of any Common Shares or (ii) it acquired such Beneficial
Ownership in the good faith belief that such acquisition would not (x) cause
such Beneficial Ownership to exceed 20% of the Common Shares then outstanding
and such Person relied in good faith in computing the percentage of its
Beneficial Ownership on publicly filed reports or documents of the Company which
are inaccurate or out-of-date or (y) otherwise cause a Distribution Date or the
adjustment provided for in Section 11(a) to occur. Notwithstanding clause (b) of
the prior sentence, if any Person that is not an Acquiring Person due to such
clause (b) does not reduce its percentage of Beneficial Ownership of Common
Shares to 20% or less by the Close of Business on the fifth Business Day after
notice from the Company (the date of notice being the first day) that such
Person's Beneficial Ownership of Common Shares so exceeds 20%, such Person
shall, at the end of such five Business Day period, become an Acquiring Person
(and such clause (b) shall no longer apply to such Person). For purposes of this
definition, the determination whether any Person acted in "good faith" shall be
conclusively determined by the Board of Directors of the Company, acting by a
vote of those directors of the Company whose approval would be required to
redeem the Rights under Section 24.

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                                                                     Exhibit 4.1

                  "Affiliate" and "Associate", when used with reference to any
Person, shall have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Exchange Act, as in effect on the
date of this Rights Agreement.

                  A Person shall be deemed the "Beneficial Owner" of, and shall
be deemed to "beneficially own", and shall be deemed to have "Beneficial
Ownership" of, any securities:

                  (i) which such Person or any of such Person's Affiliates or
Associates is deemed to "beneficially own" within the meaning of Rule 13d-3 of
the General Rules and Regulations under the Exchange Act, as in effect on the
date of this Rights Agreement;

                  (ii) which such Person or any of such Person's Affiliates or
Associates has (A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant to any agreement,
arrangement or understanding (written or oral), or upon the exercise of
conversion rights, exchange rights, rights (other than the Rights), warrants or
options, or otherwise; provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to beneficially own, or to have Beneficial Ownership of,
securities tendered pursuant to a tender or exchange offer made by or on behalf
of such Person or any of such Person's Affiliates or Associates until such
tendered securities are accepted for purchase or exchange thereunder, or (B) the
right to vote pursuant to any agreement, arrangement or understanding (written
or oral); provided, however, that a Person shall not be deemed the Beneficial
owner of, or to beneficially own, any security if (1) the agreement, arrangement
or understanding (written or oral) to vote such security arises solely from a
revocable proxy or consent given to such Person in response to a public proxy or
consent solicitation made pursuant to, and in accordance with, the applicable
rules and regulations under the Exchange Act and (2) the beneficial ownership of
such security is not also then reportable on Schedule 13D under the Exchange Act
(or any comparable or successor report); or

                  (iii) which are beneficially owned, directly or indirectly, by
any other Person with which such Person or any of such Person's Affiliates or
Associates has any agreement, arrangement or understanding (written or oral) for
the purpose of acquiring, holding, voting (except pursuant to a revocable proxy
as described in clause (ii)(B) of this definition) or disposing of any
securities of the Company.

         Notwithstanding the foregoing, nothing contained in this definition
shall cause a Person ordinarily engaged in business as an underwriter of
securities to be the "Beneficial Owner" of, or to "beneficially own", any
securities acquired in a bona fide firm commitment underwriting pursuant to an
underwriting agreement with the Company.

                  "Book Value", when used with reference to Common Shares issued
by any Person, shall mean the amount of equity of such Person applicable to each
Common Share, determined (i) in accordance with generally accepted accounting
principles in effect on the date as to which such Book Value is to be
determined, (ii) using all the consolidated assets and all the consolidated
liabilities of such Person on the date as of which such Book Value is to be
determined, except that no value shall be included in such assets for goodwill
arising from consummation of a business combination, and (iii) after giving
effect to (A) the exercise of all rights, options and warrants to purchase such
Common Shares (other than the Rights), and the conversion of all securities
convertible into such Common

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                                                                     Exhibit 4.1

Shares, at an exercise or conversion price, per Common Share, which is less than
such Book Value before giving effect to such exercise or conversion (whether or
not exercisability or convertibility is conditioned upon occurrence of a future
event), (B) all dividends and other distributions on the capital stock of such
Person declared prior to the date as of which such Book Value is to be
determined and to be paid or made after such date, and (C) any other agreement,
arrangement or understanding (written or oral), or transaction or other action
prior to the date as of which such Book Value is to be determined which would
have the effect of thereafter reducing such Book Value.

                  "Business Combination" shall have the meaning set forth in
Section 11(c)(I).

                  "Business Day" shall mean each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking institutions in the
Borough of Manhattan, the City of New York, are authorized or obligated by law
or executive order to close.

                  "Certificate of Designation" shall mean the Certification of
Designation of Series F Preferred Stock setting forth the powers, preferences,
rights, qualifications, limitations and restrictions of such series of Preferred
Stock of the Company, a copy of which is attached as Exhibit A.

                  "Close of Business" on any given date shall mean 5:00 p.m.,
New York City time, on such date; provided, however, that, if such date is not a
Business Day, "Close of Business" shall mean 5:00 p.m., New York City time, on
the next succeeding Business Day.

                  "Common Shares", when used with reference to the Company prior
to a Business Combination, shall mean the shares of Common Stock of the Company
or any other shares of capital stock of the Company into which the Common Stock
shall be reclassified or changed. "Common Shares", when used with reference to
any Person (other than the Company prior to a Business Combination), shall mean
shares of capital stock of such Person (if such Person is a corporation) of any
class or series, or units of equity interests in such Person (if such Person is
not a corporation) of any class or series, the terms of which do not limit (as a
maximum amount and not merely in proportional terms) the amount of dividends or
income payable or distributable on such class or series or the amount of assets
distributable on such class or series upon any voluntary or involuntary
liquidation, dissolution or winding up of such Person and do not provide that
such class or series is subject to redemption at the option of such Person, or
any shares of capital stock or units of equity interests into which the
foregoing shall be reclassified or changed; provided, however, that, if any time
there shall be more than one such class or series of capital stock or equity
interests of such Person, "Common Shares" of such Person shall include all such
classes and series substantially in the proportion of the total number of shares
or other units of each such class or series outstanding at such time.

                  "Common Stock" shall have the meaning set forth in the
introductory paragraph of this Rights Agreement.

                  "Company" shall have the meaning set forth in the heading of
this Rights Agreement; provided, however, that if there is a Business
Combination, "Company" shall have the meaning set forth in Section 11(c)(III).

                  The term "control" with respect to any Person shall mean the
power to direct the management and policies of such Person, directly or
indirectly, by or

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                                                                     Exhibit 4.1

through stock ownership, agency or otherwise, or pursuant to or in connection
with an agreement, arrangement or understanding (written or oral) with one or
more other Persons by or through stock ownership, agency or otherwise; and the
terms "controlling" and "controlled" shall have meanings correlative to the
foregoing.

                  "Distribution Date" shall have the meaning set forth in
Section 3(b).

                  "Exchange Act" shall mean the Securities Exchange Act of 1934,
as in effect on the date in question, unless otherwise specifically provided.

                  "Exchange Consideration" shall have the meaning set forth in
Section 11(b)(I).

                  "Expiration Date" shall have the meaning set forth in Section
7(a).

                  "Major Part," when used with reference to the assets of the
Company and its Subsidiaries as of any date, shall mean assets (i) having a fair
market value aggregating 50% or more of the total fair market value of all the
assets of the Company and its Subsidiaries (taken as a whole) as of the date in
question, (ii) accounting for 50% or more of the total value (net of
depreciation and amortization) of all the assets of the Company and its
Subsidiaries (taken as a whole) as would be shown on a consolidated or combined
balance sheet of the Company and its Subsidiaries as of the date in question,
prepared in accordance with generally accepted accounting principles then in
effect, or (iii) accounting for 50% or more of the total amount of earnings
before interest, taxes, depreciation and amortization or revenues of the Company
and its Subsidiaries (taken as a whole) as would be shown on, or derived from, a
consolidated or combined statement of income of the Company and its Subsidiaries
for the period of 12 months ending on the last day of the Company's monthly
accounting period next preceding the date in question, prepared in accordance
with generally accepted accounting principles then in effect.

                  "Market Value," when used with reference to Common Shares on
any date, shall be deemed to be the average of the daily closing prices, per
share, of such Common Shares for the period which is the shorter of (1) 30
consecutive Trading Days immediately prior to the date in question or (2) the
number of consecutive Trading Days beginning on the Trading Day immediately
after the date of the first public announcement of the event requiring a
determination of the Market Value and ending on the Trading Day immediately
prior to the record date of such event; provided, however, that, in the event
that the Market Value of such Common Shares is to be determined in whole or in
part during a period following the announcement by the issuer of such Common
Shares of any action of the type described in Section 12(a) that would require
an adjustment thereunder, then, and in each such case, the Market Value of such
Common Shares shall be appropriately adjusted to reflect the effect of such
action on the market price of such Common Shares. The closing price for each
Trading Day shall be the closing price quoted on the composite tape for
securities listed on the New York Stock Exchange, or, if such securities are not
quoted on such composite tape or if such securities are not listed on such
exchange, on the principal United States securities exchange registered under
the Exchange Act (or any recognized foreign stock exchange) on which such
securities are listed, or, if such securities are not listed on any such
exchange, the average of the closing bid and asked quotations with respect to a
share of such securities on the National Association of Securities Dealers, Inc.
Automated Quotations System ("NASDAQ") or such other system then in use, or if
no such quotations are available, the average of the closing bid and asked
prices as furnished by a professional market maker making a market in such
securities selected by the Board of Directors of

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                                                                     Exhibit 4.1

the Company. If on any such Trading Day no market maker is making a market in
such securities, the closing price of such securities on such Trading Day shall
be deemed to be the fair value of such securities as determined in good faith by
the Board of Directors of the Company (whose determination shall be described in
a statement filed with the Rights Agent and shall be binding on the Rights
Agent, the holders of Rights and all other Persons); provided, however, that for
the purpose of determining the closing price of the Preferred Shares for any
Trading Day on which there is no such market maker for the Preferred Shares the
closing price on such Trading Day shall be deemed to be the Formula Number (as
defined in the Certificate of Designation) times the closing price of the Common
Shares of the Company on such Trading Day.

                  "Person" shall mean an individual, corporation, partnership,
joint venture, association, trust, unincorporated organization or other entity.

                  "Preferred Shares" shall have the meaning set forth in the
introductory paragraph of this Rights Agreement. Any reference in this Rights
Agreement to Preferred Shares shall be deemed to include any authorized fraction
of a Preferred Share, unless the context otherwise requires.

                  "Principal Party" shall mean the Surviving Person in a
Business Combination; provided, however, that, if such Surviving Person is a
direct or indirect Subsidiary of any other Person, "Principal Party" shall mean
the Person which is the ultimate parent of such Surviving Person and which is
not itself a Subsidiary of another Person. In the event ultimate control of such
Surviving Person is shared by two or more Persons, "Principal Party" shall mean
that Person that is immediately controlled by such two or more Persons.

                  "Purchase Price" with respect to each Right shall mean $80.00,
as such amount may from time to time be adjusted as provided herein, and shall
be payable in lawful money of the United States of America. All references
herein to the Purchase Price shall mean the Purchase Price as in effect at the
time in question.

                  "Qualifying Offer" shall mean an all-cash tender offer made by
any Person for all outstanding Common Shares which meets all of the following
requirements:

         (1) on or prior to the date such offer is commenced within the meaning
         of Rule 14d-2(a) of the General Rules and Regulations under the
         Exchange Act, such Person has, and has provided to the Company, firm
         written commitments from responsible financial institutions, which have
         been accepted by such Person (or one of its Affiliates), to provide,
         subject only to customary terms and conditions, funds for such offer
         which, when added to the amount of cash and cash equivalents which such
         Person then has available and has irrevocably committed in writing to
         the Company to utilize for purposes of such offer, will be sufficient
         to pay for all Common Shares outstanding on a fully diluted basis
         pursuant to the offer and the second-step transaction required by
         clause (6) below and all related expenses, together with copies of all
         written materials prepared by such person for such financial
         institutions in connection with obtaining such financing commitments;

         (2) after the consummation of such offer, such Person, alone or
         together with any of its Affiliates and Associates, owns Common Shares
         representing a majority of the then outstanding Common Shares;

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                                                                     Exhibit 4.1

         (3) such offer remains open for at least 45 Business Days; provided,
         however, that (x) if there is any increase in the price of such offer,
         such offer must remain open for at least an additional 20 Business Days
         after the last such increase, (y) such offer must remain open for at
         least 20 Business Days after the date that any bona fide alternative
         offer is made which, in the opinion of one or more investment banking
         firms designated by the Company, provides for consideration per share
         in excess of that provided for in such offer, and (z) such offer must
         remain open for at least 20 Business Days after the date on which such
         Person reduces the per share price offered in accordance with clause
         (6)(y) below; provided further, however, that such offer need not
         remain open, as a result of this clause (3), beyond (i) the time which
         any other offer satisfying the criteria for a Qualifying Offer is then
         required to be kept open under this clause (3), or (ii) the scheduled
         expiration date, as such date may be extended by public announcement on
         or prior to the then scheduled expiration date, of any other tender or
         exchange offer for Common Shares with respect to which the Board of
         Directors has agreed to redeem the Rights immediately prior to
         acceptance for payment of Common Shares thereunder (unless such other
         offer is terminated prior to its expiration without any Common Shares
         having been purchased thereunder);

         (4) such offer is accompanied by a written opinion, in customary form,
         of a nationally recognized investment banking firm which is addressed
         to the holders of Common Shares other than such Person and states that
         the price to be paid to holders pursuant to the offer is fair from a
         financial point of view to such holders and includes any written
         presentation of such firm showing the analysis and range of values
         underlying such conclusions;

         (5) such offer is approved by a majority of the Board of Directors of
         the Company who are not officers of the Company and who are not
         nominees, Affiliates or Associates of such Person, after determining
         that the price to be paid to stockholders pursuant to the offer is the
         best value reasonably available to stockholders after taking into
         account the potential long-term value of the Company and all other
         factors that it considers relevant or otherwise in the best interest of
         the stockholders; and

         (6) prior to or on the date that such offer is commenced within the
         meaning of Rule 14d-2(a) of the General Rules and Regulations under the
         Exchange Act, such Person makes an irrevocable written commitment to
         the Company (x) to consummate a transaction or transactions promptly
         upon the completion of such offer, whereby all Common Shares not
         purchased in such offer will be acquired at the same price per share
         paid in such offer, subject only to the condition that the Board of
         Directors shall have granted any approvals required to enable such
         Person to consummate such transaction or transactions following
         consummation of such offer without obtaining the vote of any other
         stockholder, (y) that such Person will not make any amendment to the
         original offer which reduces the per share price offered (other than a
         reduction to reflect any dividend declared by the Company after the
         commencement of such offer, whether by way of recapitalization,
         reorganization, repurchase or otherwise), changes the form of
         consideration offered, or reduces the number of shares being sought or
         which is in any other respect materially adverse to the Company's
         stockholders, and (z) that neither such Person nor of any its
         Affiliates or Associates will make any offer for any equity securities
         of the Company for a period of six months after the commencement of the
         original offer if such original offer does not result in the tender of
         the

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                                                                     Exhibit 4.1

         number of Common Shares required to be purchased pursuant to clause (2)
         above, unless another tender offer by another party for all outstanding
         Common Shares is commenced that (a) constitutes a Qualifying Offer or
         (b) is approved by the Board of Directors of the Company (in which
         event, any new offer by such Person or of any of its Affiliates or
         Associates must be at a price no less than that provided for in such
         approved offer).

                  "Record Date" shall have the meaning set forth in the
introductory paragraph of this Rights Agreement.

                  "Redemption Date" shall have the meaning set forth in Section
24(a).

                  "Redemption Price" with respect to each Right shall mean $.01,
as such amount may from time to time be adjusted in accordance with Section 12.
All references herein to the Redemption Price shall mean the Redemption Price as
in effect at the time in question.

                  "Registered Common Shares" shall mean Common Shares which are,
as of the date of consummation of a Business Combination, and have continuously
been for the 12 months immediately preceding such date, registered under Section
12 of the Exchange Act.

                  "Right Certificate" shall mean a certificate evidencing a
Right in substantially the form attached as Exhibit B.

                  "Rights" shall mean the rights to purchase Preferred Shares
(or other securities) as provided in this Rights Agreement.

                  "Securities Act" shall mean the Securities Act of 1933, as in
effect on the date in question, unless otherwise specifically provided.

                  "Subsidiary" shall mean a Person, at least a majority of the
total outstanding voting power (being the power under ordinary circumstances
(and not merely upon the happening of a contingency) to vote in the election of
directors of such Person (if such Person is a corporation) or to participate in
the management and control of such Person (if such Person is not a corporation))
of which is owned, directly or indirectly, by another Person or by one or more
other Subsidiaries of such other Person or by such other Person and one or more
other Subsidiaries of such other Person.

                  "Surviving Person" shall mean (1) the Person which is the
continuing or surviving Person in a consolidation or merger specified in Section
11(c)(I)(i) or 11(c)(I)(ii) or (2) the Person to which the Major Part of the
assets of the Company and its Subsidiaries is sold, leased, exchanged or
otherwise transferred or disposed of in a transaction specified in Section
11(c)(I)(iii); provided, however, that if the Major Part of the assets of the
Company and its Subsidiaries is sold, leased, exchanged or otherwise transferred
or disposed of in one or more related transactions specified in Section
11(c)(I)(iii) to more than one Person, the "Surviving Person" in such case shall
mean the Person that acquired assets of the Company and/or its Subsidiaries with
the greatest fair market value in such transaction or transactions.

                  "Trading Day" shall mean a day on which the principal national
securities exchange (or principal recognized foreign stock exchange, as the case
may be) on which any securities or Rights, as the case may be, are listed or
admitted to trading is open for the transaction of business or, if the
securities or Rights in question are not listed or admitted to trading on any
national

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                                                                     Exhibit 4.1

securities exchange (or recognized foreign stock exchange, as the case
may be), a Business Day.

         SECTION 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint one or more co-Rights Agents as it may
deem necessary or desirable (the term "Rights Agent" being used herein to refer,
collectively, to the Rights Agent together with any such co-Rights Agents). In
the event the Company appoints one or more co-Rights Agents, the respective
duties of the Rights Agent and any co-Rights Agents shall be as the Company
shall determine.

         SECTION 3. Issue of Rights and Right Certificates. (a) One Right shall
be associated with each Common Share outstanding on the Record Date, each
additional Common Share that shall become outstanding between the Record Date
and the earliest of the Distribution Date, the Redemption Date or the Expiration
Date and each additional Common Share with which Rights are issued after the
Distribution Date but prior to the earlier of the Redemption Date or the
Expiration Date as provided in Section 23; provided, however, that, if the
number of outstanding Rights are combined into a smaller number of outstanding
Rights pursuant to Section 12(a), the appropriate fractional Right determined
pursuant to such Section shall thereafter be associated with each such Common
Share.

                  (b) Until the earlier of (i) such time as the Company learns
that a Person has become an Acquiring Person or (ii) the Close of Business on
such date, if any, as may be designated by the Board of Directors of the Company
following the commencement of, or first public disclosure of an intent to
commence, a tender or exchange offer by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or of any of
its Subsidiaries, or any Person holding Common Shares for or pursuant to the
terms of any such employee benefit plan and other than a Qualifying Offer) for
outstanding Common Shares, if upon consummation of such tender or exchange offer
such Person could be the Beneficial Owner of more than 20% of the outstanding
Common Shares (the Close of Business on the earlier of such dates being the
"Distribution Date"), (x) the Rights will be evidenced by the certificates for
Common Shares registered in the names of the holders thereof and not by separate
Right Certificates and (y) the Rights, including the right to receive Right
Certificates, will be transferable only in connection with the transfer of
Common Shares. As soon as practicable after the Distribution Date, the Rights
Agent will send, by first-class, postage-prepaid mail, to each record holder of
Common Shares as of the Distribution Date, at the address of such holder shown
on the records of the Company, a Right Certificate evidencing one whole Right
for each Common Share (or for the number of Common Shares with which one whole
Right is then associated if the number of Rights per Common Share held by such
record holder has been adjusted in accordance with the proviso in Section 3(a)).
If the number of Rights associated with each Common Share has been adjusted in
accordance with the proviso in Section 3(a), at the time of distribution of the
Right Certificates the Company may make any necessary and appropriate rounding
adjustments so that Right Certificates representing only whole numbers of Rights
are distributed and cash is paid in lieu of any fractional Right in accordance
with Section 15(a). As of and after the Distribution Date, the Rights will be
evidenced solely by such Right Certificates.

                  (c) With respect to any certificate for Common Shares, until
the earliest of the Distribution Date, the Redemption Date or the Expiration
Date, the Rights associated with the Common Shares represented by any such
certificate

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                                                                     Exhibit 4.1

shall be evidenced by such certificate alone, the registered holders of the
Common Shares shall also be the registered holders of the associated Rights and
the surrender for transfer of any such certificate shall also constitute the
transfer of the Rights associated with the Common Shares represented thereby.

                  (d) Certificates issued for Common Shares after the Record
Date (including, without limitation, upon transfer or exchange of outstanding
Common Shares), but prior to the earliest of the Distribution Date, the
Redemption Date or the Expiration Date, may have printed on, written on or
otherwise affixed to them the following legend:

         This certificate also evidences and entitles the holder hereof to
         certain Rights as set forth in a Stockholders Rights Agreement dated as
         of July 27, 1995, as it may be amended from time to time (the "Rights
         Agreement"), between Alteon Inc. (the "Company") and Registrar and
         Transfer Company, as Rights Agent (the "Rights Agent"), the terms of
         which are hereby incorporated herein by reference and a copy of which
         is on file at the principal executive offices of the Company. Under
         certain circumstances, as set forth in the Rights Agreement, such
         Rights will be evidenced by separate certificates and will no longer be
         evidenced by this certificate. The Rights Agent will mail to the holder
         of this certificate a copy of the Rights Agreement without charge after
         receipt of a written request therefor. Rights beneficially owned by
         Acquiring Persons or their Affiliates or Associates (as such terms are
         defined in the Rights Agreement) and by any subsequent holder of such
         Rights are null and void and nontransferable.

         Notwithstanding this paragraph (d), the omission of a legend shall not
affect the enforceability of any part of this Rights Agreement or the rights of
any holder of Rights.

         SECTION 4. Form of Right Certificates. The Right Certificates (and the
form of election to purchase and form of assignment to be printed on the reverse
side thereof) shall be in substantially the form set forth as Exhibit B and may
have such marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Rights Agreement, or as may be required
to comply with any applicable law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which the Rights
may from time to time be listed, or to conform to usage. Subject to the
provisions of Sections 7, 11 and 23, the Right Certificates, whenever issued,
shall be dated as of the Distribution Date, and on their face shall entitle the
holders thereof to purchase such number of Preferred Shares as shall be set
forth therein for the Purchase Price set forth therein, subject to adjustment
from time to time as herein provided.

         SECTION 5.  Execution, Countersignature and Registration.

                  (a) The Right Certificates shall be executed on behalf of the
Company by the Chairman of the Board, the Chief Executive Officer, the
President, the Chief Operating Officer, the Treasurer or a Vice President
(whether preceded by any additional title) of the Company, either manually or by
facsimile signature, and have affixed thereto the Company's seal or a facsimile
thereof which shall be attested by the Secretary, an Assistant Secretary or a
Vice President (whether preceded by any additional title, provided that such
Vice President shall not have also executed the Right Certificates) of the
Company,

                                       9
<PAGE>   13
                                                                     Exhibit 4.1

 either manually or by facsimile signature. The Right Certificates shall
be manually countersigned by the Rights Agent and shall not be valid or
obligatory for any purpose unless so countersigned. In case any officer of the
Company who shall have signed any of the Right Certificates shall cease to be
such an officer of the Company before countersignature by the Rights Agent and
issuance and delivery by the Company, such Right Certificates may nevertheless
be countersigned by the Rights Agent and issued and delivered by the Company
with the same force and effect as though the person who signed such Right
Certificates had not ceased to be such an officer of the Company; and any Right
Certificate may be signed on behalf of the Company by any person who, at the
actual date of execution of such Right Certificate, shall be a proper officer of
the Company to sign such Right Certificate, although at the date of execution of
this Rights Agreement any such person was not such an officer of the Company.

                  (b) Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at its principal office in Cranford, New Jersey, books
for registration and transfer of the Right Certificates issued hereunder. Such
books shall show the names and addresses of the respective holders of the Right
Certificates, the number of Rights evidenced by each of the Right Certificates,
the certificate number of each of the Right Certificates and the date of each of
the Right Certificates.

         SECTION 6. Transfer, Split-Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates;
Uncertificated Rights.

                  (a) Subject to the provisions of Sections 7(e) and 15, at any
time after the Distribution Date, and at or prior to the Close of Business on
the earlier of the Redemption Date or the Expiration Date, any Right Certificate
or Right Certificates may be transferred, split-up, combined or exchanged for
another Right Certificate or Right Certificates representing, in the aggregate,
the same number of Rights as the Right Certificate or Right Certificates
surrendered then represented. Any registered holder desiring to transfer,
split-up, combine or exchange any Right Certificate shall make such request in
writing delivered to the Rights Agent and shall surrender the Right Certificate
or Right Certificates to be transferred, split-up, combined or exchanged at the
principal office of the Rights Agent; provided, however, that neither the Rights
Agent nor the Company shall be obligated to take any action whatsoever with
respect to the transfer of any Right Certificate surrendered for transfer until
the registered holder shall have completed and signed the certification
contained in the form of assignment on the reverse side of such Right
Certificate and shall have provided such additional evidence of the identity of
the Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company shall reasonably request. Thereupon the Rights Agent
shall, subject to Sections 7(e) and 15, countersign and deliver to the Person
entitled thereto a Right Certificate or Right Certificates, as the case may be,
as so requested. The Company may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
transfer, split-up, combination or exchange or Right Certificates.

                  (b) Upon receipt by the Company and the Rights Agent of
evidence reasonable satisfactory to them of the loss, theft, destruction or
mutilation of a valid Right Certificate, and, in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to them, and, at
the Company's request, reimbursement to the Company and the Rights Agent of all
reasonable expenses incidental thereto, and upon surrender to the Rights Agent
and cancellation of the Right Certificate if mutilated, the Company will make a
new

                                       10
<PAGE>   14
                                                                     Exhibit 4.1

Right Certificate of like tenor and deliver such new Right Certificate to the
Rights Agent for delivery to the registered owner in lieu of the Right
Certificate so lost, stolen, destroyed or mutilated.

                  (c) Notwithstanding any other provision hereof, the Company
and the Rights Agent may amend this Rights Agreement to provide for
uncertificated Rights in addition to or in place of Rights evidenced by Right
Certificates.

                                       11
<PAGE>   15
                                                                     Exhibit 4.1

         SECTION 7.  Exercise of Rights; Expiration Date of Rights.

                  (a) Subject to Section 7(e) and except as otherwise provided
herein (including Section 11), each Right shall entitle the registered holder
thereof, upon exercise thereof as provided herein, to purchase for the Purchase
Price, at any time after the Distribution Date and at or prior to the earlier of
(i) the Close of Business on the 10th anniversary of the date of this Rights
Agreement (the Close of Business on such date being the "Expiration Date"), or
(ii) the Redemption Date, one one-thousandths (1/1,000ths) of a Preferred Share,
subject to adjustment from time to time as provided in Sections 11 and 12.

                  (b) The registered holder of any Right Certificate may
exercise the Rights evidenced thereby (except as otherwise provided herein) in
whole or in part at any time after the Distribution Date, upon surrender of the
Right Certificate, with the form of election to purchase on the reverse side
thereof duly executed, to the Rights Agent at the principal office of the Rights
Agent in New York, New York, together with payment of the Purchase price for
each one one-thousandths (1/1,000ths) of a Preferred Share as to which the
Rights are exercised, at or prior to the earlier of (i) the Expiration Date or
(ii) the Redemption Date.

                  (c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase duly executed,
accompanied by payment of the Purchase Price for the Preferred Shares to be
purchased together with an amount equal to any applicable transfer tax, in
lawful money of the United States of America, in cash or by certified check or
money order payable to the order of the Company, the Rights Agent shall
thereupon (i) either (A) promptly requisition from any transfer agent of the
Preferred Shares (or make available, if the Rights Agent is the transfer agent)
certificates for the number of Preferred Shares to be purchased and the Company
hereby irrevocably authorizes its transfer agent to comply with all such
requests or (B) if the Company shall have elected to deposit the Preferred
Shares with a depositary agent under the depositary arrangement, promptly
requisition from the depositary agent depositary receipts representing the
number of one one-thousandths (1/1,000ths) of a Preferred Share to be purchased
(in which case certificates for the Preferred Shares to be represented by such
receipts shall be deposited by the transfer agent with the depositary agent) and
the Company will direct the depositary agent to comply with all such requests,
(ii) when appropriate, promptly requisition from the Company the amount of cash
to be paid in lieu of issuance of fractional shares in accordance with Section
15, (iii) promptly after receipt of such certificates or depositary receipts,
cause the same to be delivered to or upon the order of the registered holder of
such Right Certificate, registered in such name or names as may be designated by
such holder and (iv) when appropriate, after receipt promptly deliver such cash
to or upon the order of the registered holder of such Right Certificate.

                  (d) In case the registered holder of any right Certificate
shall exercise fewer than all the Rights evidenced thereby, a new Right
Certificate evidencing Rights equivalent to the Rights remaining unexercised
shall be issued by the Rights Agent and delivered to the registered holder of
such Right Certificate or to his duly authorized assigns, subject to the
provisions of Section 15.

                  (e) Notwithstanding anything in this Rights Agreement to the
contrary, any Rights that are at any time beneficially owned by an Acquiring
Person or any Affiliate or Associate of an Acquiring Person shall be null and
void and nontransferable, and any holder of any such Right (including any

                                       12
<PAGE>   16
                                                                     Exhibit 4.1

purported transferee or subsequent holder) shall not have any right to exercise
or transfer any such Right.

                  (f) Notwithstanding anything in this Rights Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder of any Right
Certificates upon the occurrence of any purported exercise as set forth in this
Section 7 unless such registered holder shall have (i) completed and signed the
certificate contained in the form of election to purchase set forth on the
reverse side of the Right Certificate surrendered for such exercise and (ii)
provided such additional evidence of the identity of the Beneficial Owner (or
former Beneficial owner) or Affiliates or Associates thereof as the Company
shall reasonably request.

                  (g) The Company may temporarily suspend, for a period of time
not to exceed 90 calendar days after the Distribution Date, the exercisability
of the Rights in order to prepare and file a registration statement under the
Securities Act, on appropriate form, with respect to the Preferred Shares
purchasable upon exercise of the Rights and permit such registration statement
to become effective; provided, however, that no such suspension shall remain
effective after, and the Rights shall without any further action by the Company
or any other Person become exercisable immediately upon, the effectiveness of
such registration statement. Upon any such suspension, the Company shall issue a
public announcement stating that the exercisability of the Rights has been
temporarily suspended and shall issue a further public announcement at such time
as the suspension is no longer in effect. Notwithstanding any provision herein
to the contrary, the Rights shall not be exercisable in any jurisdiction if the
requisite qualification under the blue sky or securities laws of such
jurisdiction shall not have been obtained or the exercise of the Rights shall
not be permitted under applicable law.

         SECTION 8.  Cancellation and Destruction of Right Certificates.

         All Right Certificates surrendered or presented for the purpose of
exercise, transfer, split-up, combination or exchange shall, and any Right
Certificate representing Rights that have become null and void and
nontransferable pursuant to Section 7(e) surrendered or presented for any
purpose shall, if surrendered or presented to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered or presented to the Rights Agent, for cancellation and
retirement, and the Rights Agent for cancellation and retirement, and the Rights
Agent shall be canceled by it, and no Right Certificates shall be issued in lieu
thereof except as expressly permitted by this Rights Agreement. The Company
shall deliver to the Rights Agent shall so cancel and retire, any Right
Certificate purchased or acquired by the Company. The Rights Agent shall deliver
all canceled Right Certificates to the Company, or shall, at the written request
of the Company, destroy such canceled Right Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.

         SECTION 9.  Reservation and Availability of Preferred Shares.

                  (a) The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued Preferred shares
or any authorized and issued Preferred Shares held in its treasury, free from
preemptive rights or any right of first refusal, a number of Preferred Shares
sufficient to permit the exercise in full of all outstanding Rights.

                                       13
<PAGE>   17
                                                                     Exhibit 4.1

                  (b) In the event that there shall not be sufficient Preferred
Shares issued but not outstanding or authorized but unissued to permit the
exercise or exchange or Rights in accordance with Section 11, the Company
covenants and agrees that it will take all such action as may be necessary to
authorize additional Preferred Shares for issuance upon the exercise or exchange
of Rights pursuant to Section 11; provided, however, that if the Company is
unable to cause the authorization of additional Preferred Shares, then the
Company shall, or in lieu of seeking any such authorization, the Company may, to
the extent necessary and permitted by applicable law and any agreements or
instruments in effect prior to the Distribution Date to which it is a party, (A)
upon surrender of a Right, pay cash equal to the Purchase Price in lieu of
issuing Preferred Shares and requiring payment therefor, (B) upon due exercise
of a Right and payment of the Purchase Price for each Preferred Share as to
which such Right is exercised, issue equity securities having a value equal to
the value of the Preferred Shares which otherwise would have been issuable
pursuant to Section 11, which value shall be determined by a nationally
recognized investment banking firm selected by the Board or (C) upon due
exercise of a Right and payment of the Purchase Price for each Preferred Share
as to which such Right is exercised, distribute a combination of Preferred
Shares, case and/or other equity and/or debt securities having an aggregate
value equal to the value of the Preferred Shares which otherwise would have been
issuable pursuant to Section 11, which value shall be determined by a nationally
recognized investment banking firm selected by the Board. To the extent that any
legal or contractual restrictions (pursuant to agreements or instruments in
effect prior to the Distribution Date to which it is a party) prevent the
Company from paying the full amount payable in accordance with the forgoing
sentence, the Company shall pay to holders of the Rights as to which such
payments are being made all amounts which are not then restricted on a pro rata
basis as such payments become permissible under such legal or contractual
restrictions until such payments have been paid in full.

                  (c) The Company covenants and agrees that it will take all
such action as may be necessary to ensure that all Preferred Shares delivered
upon exercise or exchange of Rights shall, at the time of delivery of the
certificates for such preferred Shares (subject to payment of the Purchase
Price), be duly and validly authorized and issued and fully paid and
nonassessable shares.

                  (d) So long as the Preferred Shares issuable upon the exercise
or exchange of Rights are to be listed on any national securities exchange, the
Company covenants and agrees to use its best efforts to cause, from and after
such time as the Rights become exercisable or exchangeable, all Preferred Shares
reserved for such issuance to be listed on such securities exchange upon
official notice of issuance upon such exercise or exchange.

                  (e) The Company further covenants and agrees that it will pay
when due and payable any and all Federal and state transfer taxes and charges
which may be payable in respect of the issuance or delivery of Right
Certificates or of any Preferred Shares or Common Shares or other securities
upon the exercise or exchange of the Rights. The Company shall not, however, be
required to pay any transfer tax which may be payable in respect of any transfer
or delivery of Right Certificates to a Person other than, or in respect of the
issuance or delivery of certificates for the Preferred Shares or Common Shares
or other securities, as the case may be, in a name other than that of, the
registered holder of the Right Certificate evidencing Rights surrendered for
exercise or exchange or to issue or deliver any certificates for Preferred
Shares or Common Shares or other securities, as the case may be, upon the
exercise or exchange of any Rights until any such tax shall have been paid (any
such tax being payable by the holder of

                                       14
<PAGE>   18
                                                                     Exhibit 4.1

such Right Certificate at the time of surrender) or until it has been
established to the Company's satisfaction that no such tax is due.

         SECTION 10. Preferred Shares Record Date. Each Person in whose name any
certificate for Preferred Shares or Common Shares or other securities is issued
upon the exercise or exchange of Rights shall for all purposes be deemed to have
become the holder of record of the Preferred Shares or Common Shares or other
securities, as the case may be, represented thereby on, and such certificate
shall be dated, the date upon which the Right Certificate evidencing such Rights
was duly surrendered and payment of any Purchase Price (and any applicable
transfer taxes) was made; provided, however, that, if the date of such surrender
and payment is a date upon which the transfer books of the Company for the
Preferred Shares or Common Shares or other securities, as the case may be, are
closed, such Person shall be deemed to have become the record holder of such
Preferred Shares or Common Shares or other securities, as the case may be, on,
and such certificate shall be dated, the next succeeding Business Day on which
the transfer books of the Company for the Preferred Shares or Common Shares or
other securities, as the case may be, are open.

         SECTION 11.  Adjustments in Rights After there is an Acquiring Person;
Exchange of Rights for Shares; Business Combinations.

                  (a) Upon a Person becoming an Acquiring Person, proper
provision shall be made so that each holder of a Right, except as provided in
Section 7(e), shall thereafter have a right to receive, upon exercise thereof
for the Purchase Price in accordance with the terms of this Rights Agreement,
such number of one one-thousandths (1/1,000ths) of a Preferred Share as shall
equal the result obtained by multiplying the Purchase Price by a fraction, the
numerator of which is the number of one one-thousandths (1/1,000ths) of a
Preferred Share for which a Right is then exercisable and the denominator of
which is 50% of the market Value of the Common Shares on the date on which a
Person becomes an Acquiring Person. As soon as practicable after a Person
becomes an Acquiring Person (provided the Company shall not have elected to make
the exchange permitted by Section 11(b)(I) for all outstanding Rights), the
Company covenants and agrees to use its best efforts to:

                  (I) prepare and file a registration statement under the
Securities Act, on an appropriate form, with respect to the Preferred Shares
purchasable upon exercise of the Rights;

                  (II) cause such registration statement to become effective as
soon as practicable after such filing;

                  (III) cause such registration statement to remain effective
(with a prospectus at all times meeting the requirements of the Securities Act)
until the Expiration Date; and

                  (IV) qualify or register the Preferred Shares purchasable upon
exercise of the Rights under the blue sky or securities laws of such
jurisdictions as may be necessary or appropriate.

                  (b) (I) The Board of Directors of the Company may, at its
option, at any time after a Person becomes an Acquiring Person, mandatorily
exchange all or part of the then outstanding and exercisable Rights (which shall
not include Rights that shall have become null and void and nontransferable
pursuant to the provisions of Section 7(e)) for consideration per Right
consisting of one-half of the securities that would be issuable at such time
upon the exercise of one Right

                                       15
<PAGE>   19
                                                                     Exhibit 4.1

in accordance with Section 11(a) or, if applicable, Section 9(b) (the
consideration issuable per Right pursuant to this Section 11(b)(I) being the
"Exchange Consideration"). The Board of Directors of the Company may, at its
option, issue, in substitution for Preferred Shares, Common Shares in an amount
per Preferred Share equal to the Formula Number (as defined in the Certificate
of Designation) if there are sufficient Common Shares issued but not outstanding
or authorized but unissued. If the Board of Directors of the Company elects to
exchange all the Rights for Exchange Consideration pursuant to this Section
11(b)(I) prior to the physical distribution of the Rights Certificates, the
Corporation may distribute the Exchange Consideration in lieu of distributing
Right Certificates, in which case for purposes of this Rights Agreement holders
of Rights shall be deemed to have simultaneously received and surrendered for
exchange Right Certificates on the date of such distribution.

                           (II)  Any action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to Section 11(b)(I) shall
be irrevocable and, immediately upon the taking of such action and without any
further action and without any notice, the right to exercise any such Right
pursuant to Section 11(a) shall terminate and the only right thereafter of a
holder of such Right shall be to receive the Exchange Consideration in exchange
for each such Right held by such holder or, if the Exchange Consideration shall
not have been paid or issued, to exercise any such Right pursuant to Section 11
(c)(I). The Company shall promptly give public notice of any such exchange;
provided, however, that the failure to give, or any defect in, such notice shall
not affect the validity of such exchange. The Company promptly shall mail a
notice of any such exchange to all holders of such Rights at their last
addresses as they appear upon the registry books of the Rights Agent. Any notice
which is mailed in the manner herein provided shall be deemed given, whether or
not the holder receives the notice. Each such notice of exchange will state the
method by which the exchange of the Rights for the Exchange Consideration will
be effected and, in the event of any partial exchange, the number of Rights
which will be exchanged. Any partial exchange shall be effected pro rata based
on the number of Rights (other than Rights which shall have become null and void
and nontransferable pursuant to the provisions of Section 7(e)) held by each
holder of Rights.

                  (c) (I) In the event that, following a Distribution Date,
directly or indirectly, any transactions specified in the following clause (i),
(ii) or (iii) of this Section 11(c) (each such transaction being a "Business
Combination") shall be consummated:

                  (i)  the Company shall consolidate with, or merge with and
into, any Acquiring Person or any Affiliate or Associate of an Acquiring Person;

                  (ii) any Acquiring Person or any Affiliate or Associate of an
Acquiring Person shall merge with and into the Company and, in connection with
such merger, all or part of the Common Shares shall be changed into or exchanged
for capital stock or other securities of the Company or of any Acquiring Person
or Affiliate or Associate of an Acquiring Person or cash or any other property;
or
                  (iii) the Company shall sell, lease, exchange or otherwise
transfer or dispose of (or one or more of its Subsidiaries shall sell, lease,
exchange or otherwise transfer or dispose of), in one or more transactions, the
Major Part of the assets of the Company and its Subsidiaries (taken as a whole)
to any Acquiring Person or any Affiliate or Associate of an Acquiring Person,
then, in each case, proper provision shall be made so that each holder of a
Right, except as provided in Section 7(e), shall thereafter have the right to
receive, upon the

                                       16
<PAGE>   20
                                                                     Exhibit 4.1

exercise thereof for the Purchase Price in accordance with the terms of this
Rights Agreement, the securities specified below (or, at such holder's option,
the securities specified in Section 11(a)):

                  (A) If the Principal Party in such Business Combination has
Registered Common Shares outstanding, each Right shall thereafter represent the
right to receive, upon the exercise thereof for the Purchase Price in accordance
with the terms of this Rights Agreement, such number of Registered Common Shares
of such Principal Party, free and clear of all liens, encumbrances or other
adverse claims, as shall have an aggregate Market Value equal to the result
obtained by multiplying the Purchase Price by two;

                  (B) If the Principal Party involved in such Business
Combination does not have Registered Common Shares outstanding, each Right shall
thereafter represent the right to receive, upon the exercise thereof for the
Purchase Price in accordance with the terms of this Rights Agreement, at the
election of the holder of such Right at the time of the exercise thereof, any
of:

                  (1) such number of Common Shares of the Surviving Person in
such Business Combination as shall have an aggregate Book Value immediately
after giving effect to such Business Combination equal to the result obtained by
multiplying the Purchase Price by two;

                  (2) such number of Common Shares of the Principal Party in
such Business Combination (if the Principal Party is not also the Surviving
Person in such Business Combination) as shall have an aggregate Book Value
immediately after giving effect to such Business Combination equal to the result
obtained by multiplying the Purchase Price by two; or

                  (3) if the Principal Party in such Business Combination is an
Affiliate of one or more Persons which has Registered Common Shares outstanding,
such number of Registered Common Shares of whichever of such Affiliates of the
Principal Party has Registered Common Shares with the greatest aggregate Market
Value on the date of consummation of such Business Combination as shall have an
aggregate Market Value on the date of such Business Combination equal to the
result obtained by multiplying the Purchase Price by two.

                  (II) The Company shall not consummate any Business Combination
unless each issuer of Common Shares for which Rights may be exercised, as set
forth in this Section 11(c), shall have sufficient authorized Common Shares that
have not been issued or reserved for issuance (and which shall, when issued upon
exercise thereof in accordance with this Rights Agreement, be validly issued,
fully paid and nonassessable and free of preemptive rights, rights of first
refusal or any other restrictions or limitations on the transfer or ownership
thereof) to permit the exercise in full of the Rights in accordance with this
Section 11(c) and unless prior thereto:

                  (i) a registration statement under the Securities Act on an
appropriate form, with respect to the Rights and the Common Shares of such
issuer purchasable upon exercise of the Rights, shall be effective under the
Securities Act; and

                  (ii) the Company and each such issuer shall have:

                  (A) executed and delivered to the Rights Agent a supplemental
agreement providing for the assumption by such issuer of the obligations set
forth in this Section 11(c) (including the obligation of such issuer to issue

                                       17
<PAGE>   21
                                                                     Exhibit 4.1

Common Shares upon the exercise of Rights in accordance with the terms set forth
in Sections 11(c)(I) and 11(c)(III)) and further providing that such issuer, at
its own expense, will use its best efforts to:

                  (1) cause a registration statement under the Securities Act on
an appropriate form, with respect to the Rights and the Common Shares of such
issuer purchasable upon exercise of the Rights, to remain effective (with a
prospectus at all times meeting the requirements of the Securities Act) until
the Expiration Date;

                  (2) qualify or register the Rights and the Common Shares of
such issuer purchasable upon exercise of the Rights under the blue sky or
securities laws of such jurisdictions as may be necessary or appropriate; and

                  (3) list the Rights and the Common Shares of such issuer
purchasable upon exercise of the Rights on each national securities exchange on
which the Common Shares were listed prior to the consummation of the Business
Combination or, if the Common Shares were not listed on a national securities
exchange prior to the consummation of the Business Combination, on a national
securities exchange;

                  (B) furnished to the Rights Agent a written opinion of
independent counsel stating that such supplemental agreement is a valid, binding
and enforceable agreement of such issuer; and

                  (C) filed with the Rights Agent a certificate of a nationally
recognized firm of independent accountants setting forth the number of Common
Shares of such issuer which may be purchased upon the exercise of each Right
after the consummation of such Business Combination.

                  (III) After consummation of any Business Combination and
subject to the provisions of Section 11(c)(II), (i) each issuer of Common Shares
for which Rights may be exercised as set forth in this Section 11(c) shall be
liable for, and shall assume, by virtue of such Business Combination, all the
obligations and duties of the Company pursuant to this Rights Agreement, (ii)
The term "Company" shall thereafter be deemed to refer to such issuer, (iii)
each such issuer shall take such steps in connection with such consummation as
may be necessary to assure that the provisions hereof (including the provisions
of Sections 11(a) and 11(c)) shall thereafter be applicable, as nearly as
reasonably may be, in relation to its Common Shares thereafter deliverable upon
the exercise of the Rights, and (iv) the number of Common Shares of each such
issuer thereafter receivable upon exercise of any Right shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions of Sections 11 and 12 and the provisions of
Section 7, 9 and 10 with respect to the Preferred Shares shall apply, as nearly
as reasonably may be, on like terms to any such Common Shares.

         SECTION 12.  Certain Adjustments.

                  (a) To preserve the actual or potential economic value of the
Rights, if at any time after the date of this Rights Agreement there shall be
any change in the Common Shares or the Preferred Shares, whether by reason of
stock dividends, stock splits, recapitalization, mergers, consolidations,
combinations or exchanges of securities, split-ups, split-offs, spin-offs,
liquidations, other similar changes in capitalization, any distribution or
issuance of cash, assets, evidences of indebtedness or subscription rights,
options or warrants to holders of Common Shares or Preferred Shares, as the case
may be (other than distribution

                                       18
<PAGE>   22
                                                                     Exhibit 4.1

of the Rights or regular quarterly cash dividends) or otherwise, then, in each
such event the Board of Directors of the Company shall make such appropriate
adjustments in the number of Preferred Shares (or the number and kind of other
securities) issuable upon exercise of each Right, the Purchase Price and
Redemption Price in effect at such time and the number of Rights outstanding at
such time (including the number of Rights or fractional Rights associated with
each Common Share) such that following each adjustment such event shall not have
had the effect of reducing or limiting the benefits the holders of the Rights
would have had absent such event.

                  (b) If, as a result of an adjustment made pursuant to Section
12(a), the holder of any Right thereafter exercised shall become entitled to
receive any securities other than Preferred Shares, thereafter the number of
such securities so receivable upon exercise of any Right shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions of Sections 11 and 12 and the provisions of
Sections 7, 9 and 10 with respect to the Preferred Shares shall apply, as nearly
as reasonably may be, on like terms to any such other securities.

                  (c) All Rights originally issued by the Company subsequent to
any adjustment made to the amount of Preferred Shares or other securities
relating to a Right shall evidence the right to purchase, for the Purchase
Price, the adjusted number and kind of securities purchasable from time to time
hereunder upon exercise of the Rights, all subject to further adjustment as
provided herein.

                  (d) Irrespective of any adjustment or change in the Purchase
Price or the number of Preferred Shares or number of kind of other securities
issuable upon the exercise of the Rights, the Right Certificates theretofore and
thereafter issued may continue to express the terms which were expressed in the
initial Right Certificates issued hereunder.

                  (e) In any case in which action taken pursuant to Section
12(a) requires that an adjustment be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuing to the holder of any Right exercised after such record date
the Preferred Shares and/or other securities, if any, issuable upon such
exercise over and above the Preferred Shares and/or other securities, if any,
issuable before giving effect to such adjustment; provided, however, that the
Company shall deliver to such holder a due bill or other appropriate instrument
evidencing such holder's right to receive such additional securities upon the
occurrence of the event requiring such adjustment.

         SECTION 13. Certificate of Adjustment. Whenever an adjustment is made
as provided in Section 11 or 12, the Company shall (a) promptly prepare a
certificate setting forth such adjustment and a brief statement of the facts
accounting for such adjustment (b) promptly file with the Rights Agent and with
each transfer agent for the Preferred Shares a copy of such certificate and (c)
mail a brief summary thereof to each holder of a Right Certificate (or, prior to
the Distribution Date, of the Common Shares) in accordance with Section 25. The
Rights Agent shall be fully protected in relying on any such certificate and on
any adjustment therein contained.

         SECTION 14.  Additional Covenants.

                  (a) Notwithstanding any other provision of this Rights
Agreement, no adjustment to the number of Preferred Shares (or fractions of a
share) or other

                                       19
<PAGE>   23
                                                                     Exhibit 4.1

securities or which a Right is exercisable or the number of Rights outstanding
or associated with each Common Share or any similar or other adjustment shall be
made or be effective if such adjustment would have the effect of reducing or
limiting the benefits the holders of the Rights would have had absent such
adjustment, including, without limitation, the benefits under Sections 11 and
12, unless the terms of this Rights Agreement are amended so as to preserve such
benefits.

                  (b) The Company covenants and agrees that, after the
Distribution Date, except as permitted by Section 26, it will not take (or
permit any Subsidiary of the Company to take) any action if at the time such
action is taken it is intended or reasonably foreseeable that such action will
reduce or otherwise limit the benefits the holders of the Rights would have had
absent such action, including, without limitations, the benefits under Sections
11 and 12. Any action taken by the Company during any period after any Person
becomes an Acquiring Person but prior to the Distribution Date shall be null and
void unless such action could be taken under this Section 14(b) from and after
the Distribution Date. The Company shall not consummate any Business Combination
if any issuer of Common Shares for which Rights may be exercised after such
Business Combination in accordance with Section 11(c) shall have taken any
action that reduces or otherwise limits the benefits the holders of the Rights
would have had absent such action, including, without limitation, the benefits
under Sections 11 and 12.

         SECTION 15.  Fractional Rights and Fractional Shares.

                  (a) The Company may, but shall not be required to, issue
fractions of Rights or distribute Right Certificates which evidence fractional
Rights. In lieu of such fractional Rights, the Company may pay to the registered
holders of the Right Certificates with regard to which such fractional Rights
would otherwise be issuable an amount in cash equal to the same fraction of the
current market value of a whole Right. For purposes of this Section 15(a), the
current market value of a whole Right shall be the closing price of the Rights
(as determined pursuant to the second and third sentences of the definition of
Market Value contained in Section 1) for the Trading Day immediately prior to
the date on which such fractional Rights would have been otherwise issuable.

                  (b) The Company may, but shall not be required to, issue
fractions of Preferred Shares upon exercise of the Rights or distribute
certificates which evidence fractional Preferred Shares. In lieu of fractional
Preferred Shares, the Company may elect to (i) utilize a depository arrangement
as provided by the terms of the Preferred Shares or (ii) in the case of a
fraction of a Preferred Share (other than one one-thousandths (1/1,000ths) of a
Preferred Share or any integral multiple thereof), pay to the registered holders
of Right Certificates at the time such Rights are exercised as herein provided
an amount in cash equal to the same fraction of the current market value of one
Preferred Share, if any are outstanding and publicly traded (or the Formula
Number times the current market value of one Common Share if the Preferred
Shares are not outstanding and publicly traded). For purposes of this Section
15(b), the current market value of a Preferred Share (or Common Share) shall be
the closing price of a Preferred Share (or Common Share) (as determined pursuant
to the second and third sentences of the definition of Market Value contained in
Section 1) for the Trading Day immediately prior to the date of such exercise.
If, as a result of an adjustment made pursuant to Section 12(a), the holder of
any Right thereafter exercised shall become entitled to receive any securities
other than Preferred Shares, the provisions of this Section 15(b) shall apply,
as nearly as reasonably may be, on like terms to such other securities.

                                       20
<PAGE>   24
                                                                     Exhibit 4.1

                  (c) The Company may, but shall not be required to, issue
fractions of Common Shares upon exchange of Rights pursuant to Section 11(b), or
to distribute certificates which evidence fractional Common Shares. In lieu of
such fractional Common Shares, the Company may pay to the registered holders of
the Right Certificates with regard to which such fractional Common Shares would
otherwise be issuable an amount in cash equal to the same fraction of the
current Market Value of one Common Share as of the date on which a Person became
an Acquiring Person.

                  (d) The holder of Rights by the acceptance of the Rights
expressly waives his right to receive any fractional Rights or any fractional
shares upon exercise of a Right except as provided in this Section 15.

         SECTION 16.  Rights of Action.

                  (a) All rights of action in respect of this Rights Agreement
are vested in the respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the Common Shares);
and any registered holder of any Right Certificate (or, prior to the
Distribution Date, of the Common Shares), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Shares) may, in his own behalf and for his own
benefit, enforce, and may institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such Right Certificate in the manner provided
in such Right Certificate and in this Rights Agreement. Without limiting the
foregoing or any remedies available to the holders or Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Rights Agreement and shall be entitled to specific
performance of the obligations of any Person under, and injunctive relief
against actual or threatened violations of the obligations of any Person subject
to, this Rights Agreement.

                  (b) Any holder of Rights who prevails in an action to enforce
the provisions of this Rights Agreement shall be entitled to recover the
reasonable costs and expenses, including attorneys' fees, incurred in such
action.

         SECTION 17.  Transfer and Ownership of Rights and Right Certificates.

                  (a) Prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common Shares.

                  (b) After the Distribution Date, the Right Certificates will
be transferable, subject to Section 7(e), only on the registry books of the
Rights Agent, if surrendered at the principal office of the Rights Agent, duly
endorsed or accompanied by a proper instrument of transfer.

                  (c) The Company and the Rights Agent may deem and treat the
Person in whose name a Right Certificate (or, prior to the Distribution Date,
the associated Common Shares certificate) is registered as the absolute owner
thereof and of the Rights evidenced thereby (notwithstanding any notations of
ownership or writing on the Right Certificates or the associated certificate for
Common Shares made by anyone other than the Company or the Rights Agent) for all
purposes whatsoever, and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary.

                                       21
<PAGE>   25
                                                                     Exhibit 4.1

         SECTION 18.  Right Certificate Holder Not Deemed a Stockholder.

         No holder, as such, of any Right Certificate shall be entitled to vote
or receive dividends or be deemed, for any purpose, the holder of the Preferred
Shares or of any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything
contained herein or in any Right Certificate be construed to confer upon the
holder of any Right Certificate, as such, any of the rights of a stockholder of
the Company, including, without limitation, any right to vote for the election
of directors or upon any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any corporate action, or to receive
notice of meetings or other actions affecting stockholders, or to receive
dividends or other distributions or subscription rights, or otherwise, until the
Right or Rights evidenced by such Right Certificate shall have been exercised in
accordance with the provisions hereof.

         SECTION 19.  Concerning the Rights Agent.

                  (a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and from time to time, on
demand of the Rights Agent, its reasonable expenses and counsel fees and other
disbursements incurred in the administration and execution of this Rights
Agreement and the exercise and performance of its duties hereunder.

                  (b) The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or omitted by it in
connection with its administration of this Rights Agreement in reliance upon any
Right Certificate or certificate for the Common Shares or for other securities
of the Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate,
statement, or other paper or document believed by it to be genuine and to be
signed, executed and, where necessary, verified or acknowledged, by the proper
Person or Persons.

         SECTION 20.  Merger or Consolidation or Change of Rights Agent.

                  (a) Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be consolidated, or
any corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the stock transfer or corporate trust business of the Rights Agent
or any successor Rights Agent, shall be the successor to the Rights Agent under
this Rights Agreement without the execution or filing of any paper or any
further act on the part of any of the parties hereto; provided that such
corporation would be eligible for appointment as a successor Rights Agent under
the provisions of Section 22. In case, at the time such successor Rights Agent
may adopt the countersignature of the predecessor Rights Agent shall succeed to
the agency created by this Rights Agreement, of any of the Right Certificates
shall have been countersigned but not delivered, any such successor Rights Agent
may adopt the countersignature of the predecessor Rights Agent and deliver such
Right Certificates so countersigned; and, in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent
countersign such Right Certificate either in the name of the predecessor Rights
Agent or in the name of the successor Rights Agent; and in all such cases such
Right Certificates shall have the full force provided in the Right Certificates
and in this Rights Agreement.

                                       22
<PAGE>   26
                                                                     Exhibit 4.1

                  (b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Right Certificates so countersigned; and, in
case at that time any of the Right Certificates shall have been countersigned
but not delivered, the Rights Agent may adopt the countersignature under its
prior name and deliver Right Certificates so countersigned; and, in case at that
time any of the Rights Certificates shall not have been countersigned, the
Rights Agent may countersign such Right Certificate either in its prior name or
in its changed name; and in all such cases such Right Certificates shall have
the full force provided in the Right Certificates and in this Rights Agreement.

         SECTION 21. Duties of Rights Agent. The Rights Agent undertakes the
duties and obligations imposed by this Rights Agreement upon the following terms
and conditions, by all of which the Company and the holders of Rights
Certificates (or, prior to the Distribution Date, of the Common Shares), by
their acceptance thereof, shall be bound:

                  (a) The Rights Agent may consult with legal counsel (who may
be legal counsel for the Company), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any action
taken, suffered or omitted by it in good faith and in accordance with such
opinion.

                  (b) Whenever in the performance of its duties under this
Rights Agreement the Rights Agent shall deem it necessary or desirable that any
fact or matter (including, without limitation, the identity of any Acquiring
Person) be proved or established by the Company prior to taking, refraining from
taking or suffering any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed) may be deemed to
be conclusively proved and established by a certificate signed by any one of the
Chairman of the Board, the Chief Executive Officer, the President, the Chief
Operating Officer, the Chief Financial Officer, a Vice President (whether
preceded by any additional title), the Treasurer or the Secretary of the Company
and delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or suffered in good faith
by it under the provisions of this Rights Agreement in reliance upon such
certificate.

                  (c) The Rights Agent shall be liable hereunder only for its
own negligence, bad faith or wilful misconduct.

                  (d) The Rights Agent shall not be liable for or by reason of
any of statements of fact or recitals contained in this Rights Agreement or in
the Right Certificates (except as to its countersignature thereof) or be
required to verify the same, but all such statements and recitals are and shall
be deemed to have been made by the Company only.

                  (e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Rights Agreement or the execution and delivery
hereof (except the due execution hereof by the Rights Agent) or in respect of
the validity or execution of any Right Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Rights Agreement or in any Right
Certificate; nor shall it be responsible for any adjustment required under the
provisions of Section 11 or 12 or responsible for the manner, method or amount
of any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment (except with respect to the exercise of Rights

                                       23
<PAGE>   27
                                                                     Exhibit 4.1

evidenced by Right Certificates after actual notice of any such adjustment); nor
shall it by any act hereunder be deemed to make any representation or warranty
as to the authorization or reservation of any Preferred Shares or Common Shares
to be issued pursuant to this Rights Agreement or any Right Certificate or as to
whether any Preferred Shares or Common Shares will, when so issued, be validly
authorized and issued, fully paid and nonassessable.

                  (f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or performing by
the Rights Agent of the provisions of this Rights Agreement.

                  (g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder from
any one of the Chairman of the Board, the Chief Executive Officer, the
President, the Chief Operating Officer, a Vice President (whether preceded by
any additional title), the Secretary or the Treasurer of the Company, in
connection with its duties and it shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with instructions of any
such officer.

                  (h) The Rights Agent and any stockholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested, or contract with or
lend money to the Company or otherwise act as fully and freely as though it were
not the Rights Agent under this Rights Agreement. Nothing herein shall preclude
the Rights Agent from acting in any other capacity for the Company or for any
other legal entity.

                  (i) The Rights Agent may execute an exercise any of the rights
or powers hereby vested in it or perform any duty hereunder either itself or by
or through its attorneys or agents, and the Rights Agent shall not be answerable
or accountable for any act, default, neglect or misconduct of any such attorneys
or agents of for any loss to the Company resulting from any such act, default,
neglect or misconduct provided reasonable care was exercised in the selection
and continued employment thereof.

                  (j) The Company agrees to indemnify and to hold the Rights
Agent harmless against any loss, liability, damage or expense (including
reasonable fees and expenses of (legal counsel) which the Rights Agent may incur
resulting from its actions as Rights Agent pursuant to this Rights Agreement;
provided, however, that the Rights Agent shall not be indemnified or held
harmless with respect to any such loss, liability, damage or expense incurred by
the Rights Agent as a result of, or arising out of, its own negligence, bad
faith or wilful misconduct. In no case shall the Company be liable with respect
to any action, proceeding, suit or claim against the Rights Agent unless the
Rights Agent shall have notified the Company, by letter or by facsimile
confirmed by letter, of the assertion of any action, proceeding, suit or claim
against the Rights Agent, promptly after the Rights Agent shall have notice of
any such assertion of an action, proceeding, suit or claim or have been served
with the summons or other first legal process giving information as to the
nature and basis of the action, proceeding, suit or claim. The Company shall be
entitled to participate at its own expense in the defense of any such action,
proceeding, suit or claim, and, if the Company so elects, the Company shall
assume the defense of any such action, proceeding, suit or claim. In the event
that the Company assumes such defense, the Company shall not thereafter be
liable for the fees and expenses of any additional counsel retained by the
Rights Agent, so long as the Company shall

                                       24
<PAGE>   28
                                                                     Exhibit 4.1

retain counsel satisfactory to the Rights Agent, in the exercise of its
reasonable judgment, to defend such action, proceeding, suit or claim. The
Rights Agent agrees not to settle any litigation in connection with any action,
proceeding, suit or claim with respect to which it may seek indemnification from
the Company without the prior written consent of the Company.

         SECTION 22. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Rights
Agreement upon 30 days' notice in writing mailed to the Company and to each
transfer agent of the Common Shares and the Preferred Shares by registered or
certified mail, and to the holders of the Right Certificates (or, prior to the
Distribution Date, of the Common Shares) by first-class mail. The Company may
remove the Rights Agent or any successor Rights Agent upon 30 days' notice in
writing, mailed to the Rights Agent or successor Rights Agent, as the case may
be, and to each transfer agent of the Common Shares and the Preferred Shares by
registered or certified mail, and to the holders of the Right Certificates (or,
prior to the Distribution Date, of the Common Shares) by first-class mail. If
the Rights Agent shall resign or be removed or shall otherwise become incapable
of acting, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Right Certificate (or, prior to the Distribution Date, of the
Common Shares) (who shall, with such notice, submit his Right Certificate or,
prior to the Distribution Date, the certificate representing his Common Shares,
for inspection by the Company), then the registered holder of any Right
Certificate (or, prior to the Distribution Date, of the Common Shares) may apply
to any court of competent jurisdiction for the appointment of a new Rights
agent. Any successor Rights Agent, whether appointed by the Company or by such
court, shall be a corporation organized and doing business under the laws of the
United States or of the State of New Jersey or New York (or of any other state
of the United States so long as such corporation is authorized to conduct a
stock transfer or corporate trust business in the State of New Jersey or New
York), in good standing, having a principal office in the State of New Jersey or
New York, which is authorized under such laws to exercise stock transfer or
corporate trust powers and is subject to supervision or examination by Federal
or state authority and which has at the time of its appointment as Rights Agent
a combined capital and surplus of at least $20,000,000; provided that the
principal transfer agent for the Common Shares shall in any event be qualified
to be the Rights Agent. After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties and responsibilities as if it had
been originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment, the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Shares and the Preferred Shares, and mail a notice thereof in writing
to the registered holders of the Right Certificates (or, prior to the
Distribution Date, of the Common Shares). Failure to give any notice provided
for in this Section 22, however, or any defect therein shall not affect the
legality or validity of the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.

         SECTION 23. Issuance of Additional Rights and Right Certificates.
Notwithstanding any of the provisions of this Rights Agreement or of the Rights
to the contrary, the Company may, at its option, issue new Right

                                       25
<PAGE>   29
                                                                     Exhibit 4.1

Certificates evidencing Rights in such form as may be approved by its Board of
Directors to reflect any adjustment or change made in accordance with the
provisions of this Rights Agreement. In addition, in connection with the
issuance or sale of Common Shares following the Distribution Date and prior to
the earlier of the Redemption Date and the Expiration Date, the Company (a)
shall, with respect to Common Shares so issued or sold pursuant to the exercise
of stock options or under any employee plan or arrangement, or upon the
exercise, conversion or exchange of securities, notes or debentures issued by
the Company, and (b) may, in any other case, if deemed necessary or appropriate
by the Board of Directors number of Rights in connection with such issuance or
sale; provided, however, that (i) no such Right Certificate shall be issued if,
and to the extent that, the Company shall be advised by counsel that such
issuance would create a significant risk of material adverse tax consequences to
the Company or the Person to whom such Right Certificate wold be issued, and
(ii) no such Right Certificate shall be issued if, and to the extent that,
appropriate adjustment shall otherwise have been made in lieu of the issuance
thereof.

         SECTION 24.  Redemption and Termination.

                  (a) The Board of Directors of the Company may, at its option,
at any time prior to the earlier of (i) such time as a Person becomes an
Acquiring Person and (ii) the Expiration Date, order the redemption of all, but
not fewer than all, the then outstanding Rights at the Redemption Price (the
date of such redemption being the "Redemption Date"), and the Company, at its
option, may pay the Redemption Price either in cash or Common Shares or other
securities of the Company deemed by the Board of Directors of the Company, in
the exercise of its sole discretion, to be at least equivalent in value to the
Redemption Price; provided, however, that, in addition to any other limitations
contained herein on the right to redeem outstanding Rights (including the
occurrence of any event or the expiration of any period after which the Rights
may no longer be redeemed), for the 120-day period after any date of a change
(resulting from a proxy or consent solicitation) in a majority of the Board of
Directors of the Company in office at the commencement of such solicitation, the
Rights may only be redeemed if (A) there are directors then in office who were
in office at the commencement of such solicitation and (B) the Board of
Directors of the Company, with the concurrence of a majority of such directors
then in office, determines that such redemption is, in their judgment, in the
best interests of the Company and its stockholders.

                  (b) Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights, and without any further
action and without any notice, the right to exercise the Rights will terminate
and the only right thereafter of the holders of Rights shall be to receive the
Redemption Price. Within 10 Business Days after the action of the Board of
Directors of the Company ordering the redemption of the Rights, the Company
shall give notice of such redemption to the holders of the then outstanding
Rights by mailing such notice to all such holders at their last addresses as
they appear upon the registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the transfer agent for the Common
Shares. Each such notice of redemption will state the method by which payment of
the Redemption Price will be made. The notice, if mailed in the manner herein
provided, shall be conclusively presumed to have been duly given, whether or not
the holder of Rights receives such notice. In any case, failure to give such
notice by mail, or any defect in the notice, to any particular holder of Rights
shall not affect the sufficiency of the notice to other holders of Rights.

                                       26
<PAGE>   30
                                                                     Exhibit 4.1

         SECTION 25. Notices. Notices or demands authorized by this Agreement to
be given or made by the Rights Agent or by the holder of a Right Certificate
(or, prior to the Distribution Date, of the Common Shares) to or on the Company
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the Rights
Agent) as follows:

                  Alteon, Inc.
                  170 Williams Drive
                  Ramsey, New Jersey  07446
                  Attn: Chief Executive Officer

Subject to the provisions of Section 22, any notice or demand authorized by this
Rights Agreement to be given or made by the Company or by the holder of a Right
Certificate (or, prior to the Distribution Date, of the Common Shares) to or on
the Rights Agent shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is filed in writing with
the Company) as follows:

                  Registrar and Transfer Company
                  10 Commerce Drive
                  Cranford, New Jersey 07061
                  Attn:  Corporate Relations Department

         Notices or demands authorized by this Rights Agreement to be given or
made by the Company or the Rights Agent to any holder of a Right Certificate
(or, prior to the Distribution Date, of the Common Shares) shall be sufficiently
given or made if sent by first-class mail, postage prepaid, addressed to such
holder at the address of such holder as shown on the registry books of the
Rights Agent or, prior to the Distribution Date, on the registry books of the
transfer agent for the Common Shares.

         SECTION 26. Supplements and Amendments. At any time prior to the
Distribution Date and subject to the last sentence of this Section 26, the
Company may, and the Rights Agent shall if the Company so directs, supplement or
amend any provision of this Rights Agreement (including, without limitation, the
date on which the Distribution Date shall occur, the time during which the
Rights may be redeemed pursuant to Section 24 or any provision of the
Certificate of Designation) without the approval of any holder of the Rights.
From and after the Distribution Date and subject to applicable law, the Company
may, and the Rights Agent shall if the Company so directs, amend this Rights
Agreement without the approval of any holders of Right Certificates (i) to cure
an ambiguity or to correct or supplement any provision contained herein which
may be defective or inconsistent with any other provision of this Rights
Agreement or (ii) to make any other provisions in regard to matters or questions
arising hereunder which the Company may deem necessary or desirable and which
shall not adversely affect the interests of the holders of Right Certificates
(other than an Acquiring Person or an Affiliate or Associate of an Acquiring
Person). Any supplement or amendment adopted during any period after any Person
has become an Acquiring Person but prior to the Distribution Date shall be null
and void unless such supplement or amendment could have been adopted under the
prior sentence from and after the Distribution Date. Any supplement or amendment
to this Rights Agreement duly approved by the Company that does not amend
Sections 19, 20, 21 or 22 in a manner adverse to the Rights Agent shall become
effective immediately upon execution by the Company, whether or not also
executed by the Rights Agent. Notwithstanding anything contained in this Rights
Agreement to the contrary, during the 120-day period after any date of a change
(resulting from a proxy or

                                       27
<PAGE>   31
                                                                     Exhibit 4.1

consent solicitation) in a majority of the Board of Directors of the Company in
office at the commencement of such solicitation, this Rights Agreement may be
supplemented or amended only if (A) there are directors then in office who were
in office at the commencement of such solicitation and (B) the Board of
Directors of the Company, with the concurrence of a majority of such directors
then in office, determines that such supplement or amendment is, in their
judgment, in the best interests of the Company and its stockholders and, after
the Distribution Date, the holders of the Right Certificates. In addition,
notwithstanding anything to the contrary contained in this Rights Agreement, no
supplement or amendment to this Rights Agreement shall be made which (a) reduces
the Redemption Price (except as required by Section 12(a)) or (b) provides for
an earlier Expiration Date.

         SECTION 27. Successors. All the covenants and provisions of this Rights
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.

         SECTION 28.  Benefits of Rights Agreement; Determinations and Actions
by the Board of Directors, etc.

                  (a) Nothing in this Rights Agreement shall be construed to
give to any Person other than the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date, of the
Common Shares) any legal or equitable right, remedy or claim under this Rights
Agreement; but this Rights Agreement shall be for the sole and exclusive benefit
of the Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, of the Common Shares).

                  (b) Except as explicitly otherwise provided in this Rights
Agreement, the Board of Directors of the Company shall have the exclusive power
and authority to administer this Rights Agreement and to exercise all rights and
powers specifically granted to the Board of Directors of the Company or to the
Company, or as may be necessary or advisable in the administration of this
Rights Agreement, including, without limitation, the right and power to (i)
interpret the provisions of this Rights Agreement and (ii) make all
determinations deemed necessary or advisable for the administration of this
Rights Agreement (including, without limitation, a determination to redeem or
not redeem the Rights or to amend this Rights Agreement and a determination of
whether an offer constitutes a Qualifying Offer and whether there is an
Acquiring Person).

                  (c) Nothing contained in this Rights Agreement shall be deemed
to be in derogation of the obligation of the Board of Directors of the Company
to exercise its fiduciary duty. Without limiting the foregoing, nothing
contained herein shall be construed to suggest or imply that the Board of
Directors shall not be entitled to reject any Qualifying Offer or any other
tender offer, or to recommend that holders of Common Shares reject any
Qualifying Offer or any other tender offer, or to take any other action
(including, without limitation, the commencement, prosecution, defense or
settlement of any litigation and the submission of additional or alternative
offers or other proposals) with respect to any Qualifying Offer or any other
tender offer that the Board of Directors believes is necessary or appropriate in
the exercise of such fiduciary duty.

         SECTION 29. Severability. If any term, provision, covenant or
restriction of this Rights Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of this Rights
Agreement shall remain in full force and effect and shall in no way be affected,
impaired or invalidated.

                                       28
<PAGE>   32
                                                                     Exhibit 4.1

         SECTION 30. Governing Law. This Rights Agreement and each Right
Certificate issued hereunder shall be deemed to be a contract made under the law
of the State of Delaware and for all purposes shall be governed by and construed
in accordance with the law of such State applicable to contracts to be made and
performed entirely within such State.

         SECTION 31. Counterparts; Effectiveness. This Rights Agreement may be
executed in any number of counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such counterparts shall
together constitute but one and the same instrument. This Rights Agreement shall
be effective as of the Close of Business on the date hereof.

         SECTION 32. Descriptive Headings. Descriptive headings of the several
Sections of this Rights Agreement are inserted for convenience only and shall
not control or affect the meaning or construction of any of the provisions of
this Rights Agreement.

                  IN WITNESS WHEREOF, the parties hereto have caused this Rights
Agreement to be duly executed as of the day and year first above written.

                                       ALTEON INC.

                                       by: /s/ James J. Mauzey
                                           ---------------------------------
                                                Name: James J. Mauzey
                                                Title: Chairman & Chief
                                                       Executive Officer

                                       REGISTRAR AND TRANSFER COMPANY, as Rights
                                       Agent

                                       by: /s/ William P. Tatler
                                           ---------------------------------
                                            Name: William P. Tatler
                                            Title: Vice President

                                       29
<PAGE>   33
                                                                     Exhibit 4.1

Exhibits to Rights Agreement.

                                       30
<PAGE>   34
                                                                     Exhibit 4.1
                                                                       EXHIBIT A

                        CERTIFICATE OF THE VOTING POWERS,
                     DESIGNATIONS, PREFERENCES AND RELATIVE
                    PARTICIPATING, OPTIONAL AND OTHER SPECIAL
                     RIGHTS AND QUALIFICATIONS, LIMITATIONS
                           OR RESTRICTIONS OR SERIES F
                               PREFERRED STOCK OF
                                   ALTEON INC.

                  Pursuant to Section 151 of the General Corporation Law of the
State of Delaware, Alteon Inc. (the "Corporation") organized and existing under
the General Corporation Law of the State of Delaware, in accordance with the
provisions of Section 103 thereof, DOES HEREBY CERTIFY:

                  That, pursuant to the authority conferred upon the Board of
Directors of the Corporation by Article Fifth of the Restated Certificate of
Incorporation of the Corporation (the "Certificate of Incorporation"), the Board
of Directors of the Corporation on __________, 1995, adopted the following
resolution creating a series of Preferred Stock designated as Series F Preferred
Stock:

                  RESOLVED, that, pursuant to the authority vested in the Board
         of Directors of the Corporation in accordance with the provisions of
         the Certificate of Incorporation of the Corporation, a series of
         Preferred Stock of the Corporation is hereby created and that the
         designation and number of shares thereof an the voting powers,
         preferences and relative, participating, optional and other special
         rights of the shares of such series, and the qualifications,
         limitations or restrictions thereof are as follows:

         SECTION 1. Designation and Number of Shares. The shares of such series
shall be designated as "Series F Preferred Stock" (the "Series F Preferred
Stock"), par value $0.01 per share. The number of shares initially constituting
the Series F Preferred Stock shall be 400,000; provided, however, that, if more
than a total of 400,000 shares of Series F Preferred Stock shall be issuable
upon the exercise of Rights (the "Rights") issued pursuant to the Stockholders
Rights Agreement dated as of ________________, 1995, between the Corporation and
Registrar and Transfer Company, as Rights Agent (the "Rights Agreement"), the
Board of Directors of the Corporation, pursuant to Section 151(g) of the General
Corporation Law of the State of Delaware, shall direct by resolution or
resolutions that a certificate be properly executed, acknowledged, filed and
recorded, in accordance with the provisions of Section 103 thereof, providing
for the total number of shares of Series F Preferred Stock authorized to be
issued to be increased (to the extent that the Certificate of Incorporation then
permits) to the largest number of whole shares (rounded up to the nearest whole
number) issuable upon exercise of such Rights.

         SECTION 2. Dividends or Distributions. (a) Subject to the prior and
superior rights of the holders of shares of any other series of Preferred Stock
or other class of capital stock of the Corporation ranking prior and superior to
the shares of Series F Preferred Stock with respect to dividends, the holders of
shares of the Series F Preferred Stock shall be entitled to receive, when, as
and if declared by the Board of Directors, out of the assets of the Corporation
legally available therefore, (1) quarterly dividends payable in cash on the last
day of each fiscal quarter in each year, or such other dates as the Board of

                                       31
<PAGE>   35
                                                                     Exhibit 4.1

Directors of the Corporation shall approve (each such date being referred to
herein as a "Quarterly Dividend Payment Date"), commencing on the first
Quarterly Dividend Payment Date after the first issuance of a share or a
fraction of a share of Series F Preferred Stock, in the amount of $.01 per whole
share (rounded to the nearest cent) less the amount of all cash dividends
declared on the Series F Preferred Stock pursuant to the following clause (2)
since the immediately preceding Quarterly Dividend Payment Date or, with respect
to the first Quarterly Dividend Payment Date, since the first issuance of any
share or fraction of a share of Series F Preferred Stock (the total of which
shall not, in any event, be less than zero) and (2) dividends payable in cash on
the payment date for each cash dividend declared on the Common Stock in an
amount per whole share (rounded to the nearest cent) equal to the Formula Number
(as hereinafter defined) then in effect times the cash dividends then to be paid
on each share of Common Stock. In addition, if the Corporation shall pay any
dividend or make any distribution on the Common Stock payable in assets,
securities or other forms of noncash consideration (other than dividends or
distributions solely in shares of Common Stock), then, in each such case, the
Corporation shall simultaneously pay or make on each outstanding whole share of
Series F Preferred Stock a dividend or distribution in like kind equal to the
Formula Number then in effect times such dividend or distribution on each share
of the Common Stock. As used herein, the "Formula Number" shall be 1,000;
provided, however, that, if at any time after July 20, 1995, the Corporation
shall (i) declare or pay any dividend on the Common Stock payable in shares of
Common Stock or make any distribution on the Common Stock in share of Common
Stock, (ii) subdivide (by a stock split or otherwise) the outstanding shares of
Common Stock into a larger number of shares of Common Stock or (iii) combine (by
a reverse stock split or otherwise) the outstanding shares of Common Stock, into
a smaller number of shares of Common Stock, then in each such event the Formula
Number shall be adjusted to a number determined by multiplying the Formula
Number in effect immediately prior to such event by a fraction, the numerator of
which is the number of shares of Common Stock that are outstanding immediately
after such event and the denominator of which is the number of shares of Common
Stock that are outstanding immediately prior to such event (and rounding the
result to the nearest whole number); and provided further, that, if an any time
after July 20, 1995, the Corporation shall issue any shares of its capital stock
in a merger, reclassification, or change of the outstanding shares of Common
Stock, then in each such event the Formula Number shall be appropriately
adjusted to reflect such merger, reclassification or change so that each share
of Preferred Stock continues to be the economic equivalent of a Formula Number
of shares of Common Stock prior to such merger, reclassification or change.

                  (b) The Corporation shall declare a dividend or distribution
on the Series F Preferred Stock as provided in Section 2(a) immediately prior to
or at the same time it declares a dividend or distribution on the Common Stock
(other than a dividend or distribution solely in shares of Common Stock);
provided, however, that, in the event no dividend or distribution (other than a
dividend or distribution in shares of Common Stock) shall have been declared on
the Common Stock during the period between any Quarterly Dividend Payment Date
and the next subsequent Quarterly Dividend Payment Date, a dividend of $.01 per
share on the Series F Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date. The Board of Directors may fix a
record date for the determination of holders of shares of Series F Preferred
Stock entitled to receive a dividend or distribution declared thereon, which
record date shall be the same as the record date for corresponding dividend or
distribution on the Common Stock.

                                       32
<PAGE>   36
                                                                     Exhibit 4.1

                  (c) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series F Preferred Stock from and after the Quarterly
Dividend Payment Date next preceding the date of original issue of such shares
of Series F Preferred Stock; provided, however, that dividends on such shares
which are originally issued after the record date for the determination of
holders of shares of Series F Preferred Stock entitled to receive a quarterly
dividend and on or prior to the next succeeding Quarterly Dividend Payment Date
shall begin to accrue and be cumulative from and after such Quarterly Dividend
Payment Date. Notwithstanding the foregoing, dividends on shares of Series F
Preferred Stock which are originally issued prior to the record date for the
determination of holders of shares of Series F Preferred Stock entitled to
receive a quarterly dividend on the first Quarterly Dividend Payment Date shall
be calculated as if cumulative from and after the last day of the fiscal quarter
next preceding the date of original issuance of such shares. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares of Series F
Preferred Stock in an amount less than the total amount of such dividends at the
time accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding.

                  (d) So long as any shares of the Series F Preferred Stock are
outstanding, no dividends or other distributions shall be declared, paid or
distributed, or set aside for payment or distribution, on the Common Stock
unless, in each case, the dividend required by this Section 2 to be declared on
the Series F Preferred Stock shall have been declared.

                  (e) The holders of the shares of Series F Preferred Stock
shall not be entitled to receive any dividends or other distribution except as
provided herein.

         SECTION 3.  Voting Rights. The holders of shares of Series F Preferred
Stock shall have the following voting rights:

                  (a) Each holder of Series F Preferred Stock shall be entitled
to a number of votes equal to the Formula Number then in effect, for each share
of Series F Preferred Stock held of record on each matter on which holders of
the Common Stock or stockholders generally are entitled to vote, multiplied by
the maximum number of votes per share which any holder of the Common Stock or
stockholders generally then have with respect to such matter (assuming any
holding period or other requirement to vote a greater number of shares is
satisfied).

                  (b) Except as otherwise provided herein or by applicable law,
the holders of shares of Series F Preferred Stock and the holders of shares of
Common Stock shall vote together as one class for the election of directors of
the Corporation and on all other matters submitted to a vote of stockholders of
the Corporation.

                  (c) If, at the time of any annual meeting of stockholders for
the election of directors, the equivalent of six quarterly dividends (whether or
not consecutive) payable on any share or shares of Series F Preferred Stock are
in default, the number of directors constituting the Board of Directors of the
Corporation shall be increased by two. In addition to voting together with the
holders of Common Stock for the election of other directors of the Corporation,
the holders of record of the Series F Preferred Stock, voting separately as a
class to the exclusion of the holders of Common Stock, shall be entitled at said
meeting of stockholders (and at each subsequent annual meeting of stockholders),
unless all dividends in arrears have been paid or declared and set apart for

                                       33
<PAGE>   37
                                                                     Exhibit 4.1

payment prior thereto, to vote for the election of two directors of the
Corporation, the holders of any Series F Preferred Stock being entitled to cast
a number of votes per share of Series F Preferred Stock equal to the Formula
Number. Until the default in payments of all dividends which permitted the
election of said directors shall cease to exist, any director who shall have
been so elected pursuant to the next preceding sentence may be removed at any
time, either with or without cause, only by the affirmative vote of the holders
of the shares of Series F Preferred Stock at the time entitled to cast a
majority of the votes entitled to be cast for the election of any such director
at a special meeting of such holders called for that purpose, and any vacancy
thereby created may be filled by the vote of such holders. If and when such
default shall cease to exist, the holders of the Series F Preferred Stock shall
be divested of the foregoing special voting rights, subject to revesting in the
event of each and every subsequent like default in payments of dividends. Upon
the termination of the foregoing special voting rights, the terms of office of
all persons who may have been elected directors pursuant to said special voting
rights shall forthwith terminate, and the number of directors constituting the
Board of Director shall be reduced by two. The voting rights granted by this
Section 3(c) shall be in addition to any other voting rights granted to the
holders of the Series F Preferred Stock in this Section 3.

                  (d) Except as provided herein, in Section 11 or by applicable
law, holders of Series F Preferred Stock shall have no special voting rights and
their consent shall not be required (except to the extent they are entitled to
vote with holders of Common Stock as set forth herein) for authorizing or taking
any corporate action.

         SECTION 4.  Certain Restrictions.

                  (a) Whenever quarterly dividends or other dividends or
distributions payable on the Series F Preferred Stock as provided in Section 2
are in arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series F Preferred Stock
outstanding shall have been paid in full, the Corporation shall not

         (i) declare or pay dividends on, make any other distributions on, or
         redeem or purchase or otherwise acquire for consideration any shares of
         stock ranking junior (either as to dividends or upon liquidation,
         dissolution or winding up) to the Series F Preferred Stock;

         (ii) Declare or pay dividends on, or make any other distributions on
         any shares of stock ranking on a parity (either as to dividends or upon
         liquidation, dissolution or winding up) with the Series F Preferred
         Stock, except dividends paid ratably on the Series F Preferred Stock
         and all such parity stock on which dividends are payable or in arrears
         in proportion to the total amounts to which the holders of all such
         shares are then entitled;

         (iii) redeem or purchase or otherwise acquire for consideration shares
         of any stock ranking on a parity (either as to dividends or upon
         liquidation, dissolution or winding up) with the Series F Preferred
         Stock; provided that the Corporation may at any time redeem, purchase
         or otherwise acquire shares of any such parity stock in exchange for
         shares of any stock of the Corporation ranking junior (either as to
         dividends or upon dissolution, liquidation or winding up) to the Series
         F Preferred Stock; or

                                       34
<PAGE>   38
                                                                     Exhibit 4.1

         (iv) purchase or otherwise acquire for consideration any shares of
         Series F Preferred Stock, or any shares of stock ranking on a parity
         with the Series F Preferred Stock, except in accordance with a purchase
         offer made in writing or by publication (as determined by the Board of
         Directors) to all holders of such shares upon such terms as the Board
         of Directors, after consideration of the respective annual dividend
         rates and other relative rights and preferences of the respective
         series and classes, shall determine in good faith will result in fair
         and equitable treatment among the respective series or classes.

                  (b) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under paragraph (a) of
this Section 4, purchase or otherwise acquire such shares at such time and in
such manner.

         SECTION 5. Liquidation Rights. Upon the liquidation, dissolution or
winding up of the Corporation, whether voluntary or involuntary, no distribution
shall be made (1) to the holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series F
Preferred Stock unless, prior thereto, the holders of shares of Series F
Preferred Stock shall have received an amount equal to the accrued and unpaid
dividends and distributions thereon, whether or not declared, to the date of
such payment, plus an amount equal to the greater of (x) $.01 per whole share or
(y) an aggregate amount per share equal to the Formula Number then in effect
times the aggregate amount to be distributed per share to holders of Common
Stock or (2) to the holders of stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with the Series F Preferred
Stock, except distributions made ratably on the Series F Preferred Stock and all
other such parity stock in proportion to the total amounts to which the holders
of all such shares are entitled upon such liquidation, dissolution or winding
up.

         SECTION 6. Consolidation, Merger, etc. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction in which
the shares of Common Stock are exchanged for or changed into other stock or
securities, cash or any other property, then in any such case the then
outstanding shares of Series F Preferred Stock shall at the same time be
similarly exchanged or changed into an amount per share equal to the Formula
Number then in effect times the aggregate amount of stock, securities, cash or
any other property (payable in kind), as the case may be, into which or for
which each share of Common Stock is exchanged or changed. In the event both this
Section 6 and Section 2 appear to apply to a transaction, this Section 6 will
control.

         SECTION 7.  No Redemption; No Sinking Fund.

                  (a) The shares of Series F Preferred Stock shall not be
subject to redemption by the Corporation or at the option of any holder of
Series F Preferred Stock except as set forth in the Certificate of Incorporation
of the Corporation; provided, however, that the Corporation may purchase or
otherwise acquire outstanding shares of Series F Preferred Stock in the open
market or by offer to any holder or holders of shares of Series F Preferred
Stock.

                  (b) The shares of Series F Preferred Stock shall not be
subject to or entitled to the operation of a retirement or sinking fund.

                                       35
<PAGE>   39
                                                                     Exhibit 4.1

         SECTION 8. Ranking. The Series F Preferred Stock shall rank junior to
all other series of Preferred Stock of the Corporation, unless the Board of
Directors shall specifically determine otherwise in fixing the powers,
preferences and relative, participating, optional and other special rights of
the shares of such series and the qualifications, limitations and restrictions
thereof.

         SECTION 9. Fractional Shares. The Series F Preferred Stock shall be
issuable upon exercise of the Rights issued pursuant to the Rights Agreement in
whole shares or in any fraction of a share that is one one-thousandths
(1/1,000ths) of a share of any integral multiple of such fraction which shall
entitle the holder, in proportion to such holder's fractional shares, to receive
dividends, exercise voting rights, participate in distributions and to have the
benefit of all other rights of holders of Series F Preferred Stock. In lieu of
fractional shares, the Corporation, prior to the first issuance of a share or a
fraction of a share of Series F Preferred Stock, may elect (1) to make a cash
payment as provided in the Rights Agreement for fractions of a share other than
one one-thousandths (1/1,000ths) of a share or any integral multiple thereof or
(2) to issue depository receipts evidencing such authorized fraction of a share
of Series F Preferred Stock pursuant to an appropriate agreement between the
Corporation and a depository selected by the Corporation; provided that such
agreement shall provide that the holders of such depository receipts shall have
all the rights, privileges and preferences to which they are entitled as holders
of the Series F Preferred Stock.

         SECTION 10. Reacquired Shares. Any shares of Series F Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but unissued shares of
Preferred Stock, without designation as to series until such shares are once
more designated as part of a particular series by the Board of Directors
pursuant to the provisions of Article Fifth of the Certificate of Incorporation.

         SECTION 11. Amendment. None of the powers, preferences and relative,
participating, optional and other special rights of the Series F Preferred Stock
as provided herein or in the Certificate of Incorporation shall be amended in
any manner which would alter or change the powers, preferences, rights or
privileges of the holders of Series F Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of at least 66-2/3% of the
outstanding shares of Series F Preferred Stock, voting as a separate class;
provided, however, that no such amendment approved by the holders of at least
66-2/3% of the outstanding shares of Series F Preferred Stock shall be deemed to
apply to the powers, preferences, rights or privileges of any holder of shares
of Series F Preferred Stock originally issued upon exercise of the Rights after
the time of such approval without the approval of such holder.

                  IN WITNESS WHEREOF, the Corporation has caused this
Certificate to be duly executed in its corporate name on this  day of
_____________ 1995.

                                       Alteon Inc.

                                        By:
                                           Name:
                                           Title:

                                       36
<PAGE>   40
                                                                     Exhibit 4.1

Attest:

Name:
Title:

                                       37
<PAGE>   41
                                                                     Exhibit 4.1
                                                                       EXHIBIT B

                           [Form of Right Certificate]

Certificate No. [R]-
                                  Rights
                  ---------------

                  NOT EXERCISABLE AFTER __________, 2005, OR EARLIER IF REDEEMED
                  BY THE COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
                  OPTION OF THE COMPANY, AT $.01 PER RIGHT, ON THE TERMS SET
                  FORTH IN THE STOCKHOLDERS RIGHTS AGREEMENT. RIGHTS
                  BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR AN AFFILIATE OR
                  ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN
                  THE STOCKHOLDERS RIGHTS AGREEMENT) AND BY ANY SUBSEQUENT
                  HOLDER OF SUCH RIGHTS ARE NULL AND VOID AND NONTRANSFERABLE.

                                Right Certificate

                                   ALTEON INC.

                  This certifies that , or registered assigns, is the registered
owner of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Stockholders
Rights Agreement dated as of ____________, 1995 (the "Rights Agreement"),
between Alteon Inc., a Delaware corporation (the "Company"), and Registrar and
Transfer Company, as Rights Agent (the "Rights Agent"), unless the Rights
evidenced hereby shall have been previously redeemed by the Company, to purchase
from the Company at any time after the Distribution Date (as defined in the
Rights Agreement) and prior to 5:00 p.m., New York City time, on the 10th
anniversary of the date of the Rights Agreement (the "Expiration Date"), at the
principal office of the Rights Agent, or its successors as Rights Agent, one
one-thousandths (1/1,000ths) of a fully paid, nonassessable share of Series F
Preferred Stock, par value $0.01 per share, of the Company (the "Preferred
Shares"), at a purchase price per one one-thousandths (1/1,000ths) of a share
equal to $80.00 (the "Purchase Price") payable in cash, upon presentation and
surrender of this Right Certificate with the Form of Election to Purchase duly
executed.

                  The Purchase Price and the number and kind of shares which may
be purchased upon exercise of each Right evidenced by this Right Certificate, as
set forth above, are the Purchase Price and the number and kind of shares which
may be so purchased as of [ ]. As provided in the Rights Agreement, the Purchase
Price and the number and kind of shares which may be purchased upon the exercise
of each Right evidenced by this Right Certificate are subject to modification
and adjustment upon the happening of certain events.

                  If the Rights evidenced by this Right Certificate are at any
time beneficially owned by an Acquiring Person or an Affiliate or Associate of
an Acquiring Person (as such terms are defined in the Rights Agreement), such
Rights shall be null and void and nontransferable and the holder of any such
Right (including any purported transferee or subsequent holder) shall not have
any right to exercise or transfer any such Right.

                                       38
<PAGE>   42
                                                                     Exhibit 4.1

                  This Right Certificate is subject to all the terms, provisions
and conditions of the Rights Agreement, which terms, provisions and conditions
are hereby incorporated herein by reference and made a part hereof and to which
reference to the Rights Agreement is hereby made for a full description of the
rights, limitations of rights, obligations, duties and immunities hereunder of
the Rights Agent, the Company and the holders of the Right Certificates. Copies
of the Rights Agreement are on file at the above-mentioned office of the Rights
Agent and are also available from the Company upon written request.

                  This Right Certificate, with or without other Right
Certificates, upon surrender at the principal stock transfer or corporate trust
office of the Rights Agent, may be exchanged for another Right Certificate or
Right Certificates of like tenor and date evidencing Rights entitling the holder
to purchase a like aggregate number and kind of shares as the Rights evidenced
by the Right Certificate or Right Certificates surrendered shall have entitled
such holder to purchase. If this Right Certificate shall be exercised in part,
the holder shall be entitled to receive upon surrender hereof another Right
Certificate or Right Certificates for the number of whole Rights not exercised.

                  Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Right Certificate may be redeemed by the Company at its option
at a redemption price (in cash or shares of Common Stock or other securities of
the Company deemed by the Board of Directors to be at least equivalent in value)
of $.01 per Right (which amount shall be subject to adjustment as provided in
the Rights Agreement) at any time prior to the earlier of (i) such time as a
Person becomes an Acquiring Person and (ii) the Expiration Date; provided,
however, that, for the 120-day period after any date of a change (resulting from
a proxy or consent solicitation) in a majority of the Board of Directors of the
Company in office at the commencement of such solicitation, the Rights may only
be redeemed if (A) there are directors then in office who were in office at the
commencement of such solicitation and (B) the Board of Directors of the Company,
with the concurrence of a majority of such directors then in office, determines
that such redemption is, in their judgment, in the best interests of the Company
and its stockholders.

                  The Company may, but shall not be required to, issue fractions
of Preferred Shares or distribute certificates which evidence fractions of
Preferred Shares upon the exercise of any Right or Rights evidenced hereby. In
lieu of issuing fractional shares, the Company may elect to make a cash payment
as provided in the Rights Agreement for fractions of a share other than one
one-thousandths (1/1,000ths) of a share or any integral multiple thereof or to
issue certificates or utilize a depository arrangement as provided in the terms
of the Rights Agreement and the Preferred Shares.

                  No holder of this Right Certificate shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of the Preferred
Shares or of any other securities of the Company which may at any time be
issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder thereof, as such, any
of the rights of a stockholder of the Company, including, without limitation,
any right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in the Rights Agreement), or to receive
dividends or other distributions or subscription rights, or otherwise, until the
Right or Rights evidenced by this Right Certificate shall have been exercised as
provided in accordance with the provisions of the Rights Agreement.

                                       39
<PAGE>   43
                                                                     Exhibit 4.1

                  This Right Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights Agent.

                  WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal.

Dated as of:

                                       ALTEON INC.,

                                        By:
                                           --------------------------
                                           Name:
                                           Title:

Attest:

Name:
Title:

Countersigned:

Registrar and Transfer Company
as Rights Agent,

By:
   ------------------------------
         Authorized Officer

                                       40
<PAGE>   44
                                                                     Exhibit 4.1

                     [On Reverse Side of Right Certificate]

                          FORM OF ELECTION TO PURCHASE

                   (To be executed by the registered holder if
                   such holder desires to exercise the Rights
                     represented by this Right Certificate.)

To the Rights Agent:

                  The undersigned hereby irrevocably elects to exercise Rights
represented by this Right Certificate to purchase the Preferred Shares (or other
shares) issuable upon the exercise of such Rights and requests that certificates
for such shares be issued in the name of:

Please insert social security
or other identifying number

                         (Please print name and address)

                  If such number of Rights shall not be all the Rights evidenced
by this Right Certificate, a new Right Certificate for the balance remaining of
such Rights shall be registered in the name of and delivered to:

Please insert social security
or other identifying number

                         (Please print name and address)

Dated:                     , 19
         ------------------    ---

                                       Signature

Signature Guaranteed:

                                     NOTICE

                                       41
<PAGE>   45
                                                                     Exhibit 4.1

                  The signature on the foregoing Form of Election to Purchase
must correspond to the name as written upon the face of this Right Certificate
in every particular, without alteration or enlargement or any change whatsoever.

                                       42<PAGE>   1
                                                                    Exhibit 10.8

                                TABLE OF CONTENTS

                       170 WILLIAMS ASSOCIATES ALTEON INC.

<TABLE>
<CAPTION>
                      CLAUSE                                                PAGE
<S>                                                                         <C>
    Preamble                                                                  1
1.  Premises                                                                  3
2.  Term                                                                      3
3.  Construction                                                              4
4.  Landlord's Financing                                                      6
5.  Rental                                                                    6
6.  Use                                                                       7
7.  Insurance                                                                 8
8.  Increase of Insurance Rates                                               9
9.  Fire and Other Casualty                                                   9
10. Repairs and Maintenance                                                   10
11. Covenants Against Liens                                                   11
12. Alterations                                                               12
13. Condemnation                                                              12
14. Access and Right to Exhibit                                               13
15. Assignment and Subletting                                                 14
16. Rules and Regulations, Compliance with Laws                               15
17. Utilities                                                                 16
18. Signs                                                                     16
19. Taxes                                                                     17
20. Additional Charges                                                        18
21. Non-Liability of Landlord                                                 19
22. Intentionally Omitted                                                     20
23. Right to Cure Default                                                     20
24. Remedies Upon Default                                                     20
25. Waiver of Redemption                                                      22
26. Mortgage Priority                                                         22
27. Surrender of Premises                                                     23
28. Unavoidable Delays                                                        23
29. Landlord Consent                                                          24
30. Escrow for Fit-Up                                                         24
31. Certification                                                             25
32. Waiver of Trail by Jury                                                   25
33. Quiet Enjoyment                                                           25
34. Landlord                                                                  26
35. Notices                                                                   26
36. Covenants, Effect of Waiver                                               26
37. Holding Over                                                              27
38. Reference                                                                 27
39. Entire Agreement                                                          27
40. Attornment                                                                27
41. Real Estate Broker                                                        28
42. Validity of Lease                                                         28
43. Common Areas                                                              28
44. Representations                                                           28
45. ECRA and Environmental Laws                                               28
46. Option to Renew                                                           30
47. Cancellation Option                                                       31
48. Expansion                                                                 31
49. Environmental Survey                                                      32
50. Non-Binding Nature of Submittal                                           32
</TABLE>

                                       1
<PAGE>   2
                                                                    Exhibit 10.8

                               AGREEMENT OF LEASE

                                    PREAMBLE

The Landlord and Tenant agree to the leasing of the premises indicated on the
terms and conditions specified and agree that the following terms whenever used
in this Lease shall have the meanings indicated unless the terms are otherwise
expressly modified, limited or expanded herein.

(1) LANDLORD: 170 Williams Associates, a New Jersey General Partnership

    ADDRESS: 500 Route 17 South, Hasbrouck Heights, NJ 07604

(2) TENANT: Alteon Inc.

    ADDRESS: 165 Ludlow Avenue, Northvale, NJ 07647

(3) DATE OF LEASE: January 3, 1993

(4) LEASED PREMISES: Land and Building as shown on Exhibits A&B

    ADDRESS:170 Williams Drive, Ramsey, NJ

    DESCRIPTION: As Shown on Exhibits A & B

    TERM: Ten (10) Years

    COMMENCEMENT DATE OF TERM: November 1, 1993

    TERMINATION DATE: October 31, 2003

(6) APPROXIMATE SIZE OF BUILDING: 37,000 Sq. Ft.

(7) BASE RENT:

    COMMENCEMENT DATE BASE RENT: November 1, 1993

    TOTAL LEASE BASE RENTAL: $4,815,874.68

<TABLE>
<S>                         <C>          <C>
    ANNUAL BASE RENTAL:     Year 1    :  $296,833.32
                            Year 2    :  $321,854.16
                            Year 3    :  $441,687.48
                            Years 4-10:  $536,499.96
</TABLE>

<TABLE>
<S>                         <C>             <C>
    MONTHLY BASE RENTAL:    Months 1- 18 :  $24,736.11 per Month
                            Months 19- 30:  $28,906.25 per Month
                            Months 31-120:  $44,708.33 per Month
</TABLE>

    RENT DUE DATE: First of Month

(8) ESCROW FOR FIT-UP: $1,034,000.00

(9) TENANT'S ALLOCABLE PERCENTAGE: 100 %

(10) ESTIMATED ADDITIONAL MONTHLY RENTAL CHARGE: $3,533.00(Taxes & Ins.)

(11) PERMITTED USE: General offices, warehouse and pharmaceutical
                    development laboratories includinq animal testing.

(12) INSURANCE REQUIREMENTS:
     LANDLORD: Per Paragraph 20
     TENANT: Per Paragraph 7

(13) BROKER: Edward S. Gordon company of New Jersey Inc.

(14) TAX IDENTIFICATION NO.

                                      -1-
<PAGE>   3
                                                                    Exhibit 10.8

     LANDLORD: 22-2340277

     TENANT: 13-3304550

(15) TENANT SIC NO: 8731

(16) EXHIBITS:      A. Site Plan
                    B. Existing Floor Plan
                    C. Letter of Intent
                    D. Form of Non-Disturbance Agreement

                                      -2-
<PAGE>   4
                                                                    Exhibit 10.8

                              W I T N E S S E T H:

PREMISES.

         1. The Landlord hereby leases to Tenant and Tenant hereby takes from
Landlord, those certain premises, consisting of a building on land owned by
Landlord (which building and land are collectively hereinafter referred to as
the "Leased Premises") , located in the Borough of Ramsey, County of Bergen and
State of New Jersey,and more particularly described on Exhibit "A" (the Land)
and Exhibit B (the Building) attached hereto and made a part hereof, subject
however, to all of the terms, covenants, provisions and conditions herein set
forth and to all liens, encumbrances, conditions, rights, easements,
restrictions, rights-of-way, covenants and zoning and building laws, ordinances,
regulations and codes affecting or governing the Building or which may hereafter
affect or govern the Building, and such matters as may be disclosed by
inspection,provided the same do not impair or interfere with the use and
enjoyment of the Leased Premises by Tenant for the purpose hereinafter stated in
Paragraph 6. Landlord represents and warrants that all liens encumbrances,
conditions, rights, easements, restrictions, rights-of-way and covenants and
agreements do not interfere with the use and enjoyment of the Leased Premises.

                  TO HAVE AND TO HOLD the Premises for the term and at the rents
herein set forth together with the right to use the driveway on Lot 13 which is
adjacent to the Leased Premises for ingress and egress.

TERM.

         2.       (a) The Term of this lease (hereinafter referred to as "Term")
shall be for the period stated following the Commencement Date, as hereinafter
defined, unless sooner terminated as herein expressly provided. In the event
however, that the Commencement Date is not the first day of a month, then the
Term shall end on the last day of the month in which the anniversary of the
Commencement Date shall fall.

                  (b) The term, and the Tenant's obligation to pay Rental and
Additional Rental, as hereinafter defined, shall commence on the earlier of the
following dates (which date is hereinafter referred to as the "Commencement
Date"): (1) On November 1, 1993 or (2) the date on which Tenant shall first
conduct any business activities on the Premises provided Landlord has completed
all of the work it is required to do by Paragraph 3 (a) by November 1, 1993 and
tendered possession of the Premises to Tenant for Tenant to begin its Tenants
Work (as hereinafter defined) on or prior to February 1, 1993 (February 1, 1993
is hereinafter referred to as "Possession Date"). If Tenant utilizes any of the
space in the Building prior to November 1, 1993 for its regular business
activities, it shall pay the Landlord on a monthly basis a pro rata portion of
the Total Lease Base Rental and estimated Additional Rent which shall be
determined by dividing the space so occupied by 37,000 and multiplying the
result by $45,373.96. In the event of such pre-Term occupancy for such regular
business activities, all of the other terms and conditions of this Lease shall
apply to Tenant's use and occupancy of the Leased Premises.

                  (c) For purposes of this lease, a "Lease Year" shall be deemed
to be each consecutive period of twelve (12) full calendar months during the
Term hereof, except that the first Lease Year shall also include the fractional
portion of the month, if any, immediately following the Commencement Date, and
that the last Lease Year shall run only from the day following the termination
of the previous Lease Year to the termination 67 date of the lease.

                                      -3-
<PAGE>   5
                                                                    Exhibit 10.8

CONSTRUCTION.

         3.       (a) The premises are being leased by Tenant on an as-is basis
except as otherwise indicated herein. Landlord shall, at its sole cost and
expense, complete the following building improvements prior to Tenant's
occupancy:

                           (i) Furnish and install, at the election of Tenant,
one (1) of the following elevators: (a) one (1) twin jack, holeless, hydraulic
freight elevator approximately 6'4" x 8'2", 4000 lb. capacity, speed 75 fpm, two
(2) stops in-line, with 6'x 7' bi-parting manual gates as manufactured by Casper
Elevator Company or equal; or (b) one (1) single jack, holeless, hydraulic
passenger elevator approximately 7'X 6', 3000 lb. capacity (20 people), 100 with
a 3' 0" wide door as manufactured by Dover Elevator Company or equal; or (c)
4500 lb. hydraulic with interior dimensions of 5'8" x 7'11" manufactured by Otis
Elevator or Dover Elevator or equal subject to the approval of Tenant's
Architect;

                           (ii) Furnish and install windows into the portion of
the lower floor which is above grade and four (4) windows in the rear wall of
the second floor. Such windows to be of equal quality to those presently
installed on the upper floor. Landlord shall submit shop drawings for such
windows to the Tenant's architect for the architect's reasonable approval which
shall not be unreasonably withheld or delayed;

                           (iii) Furnish and install screening on the roof to
screen the HVAC equipment from view at the front approach to the building.
Screening to be aesthetically and structurally consistent with the quality and
style of the building;

                           (iv) Landlord shall investigate the possibility of
water leakage into the first floor and, if required, perform any necessary
corrective measures in a manner subject to the reasonable approval of Tenant
and/or its architect/engineer;

                  (b) The Tenant shall complete all other improvements within
the Building required for its occupancy (hereinafter referred to as "Tenant's
Work"), in accordance with plans to be prepared by the Grad Partnership,
Tenant's architect (hereinafter referred to as "Tenant's Plans"). Tenant's Plans
shall be subject to the prior written approval of Landlord, which approval shall
not be unreasonably withheld or unduly delayed. The Landlord shall provide an
allowance of $1.50 per rentable square foot towards the costs of Tenants Plans.
This drawing allowance shall be paid to Tenant twenty (20) days following the
later of : (1) the date of drawing completion or (2) the start of construction
of Tenant improvements. All costs involved in Tenant's work (including, but not
limited to permits, professional fees, cost of utilities, interest costs to
Landlord for all sums paid by Landlord to Tenant as hereinafter provided and all
improvements costs) (herein referred to as "Tenant Construction Costs") are the
responsibility of the Tenant. Landlord will reimburse Tenant, for a portion of
all Tenant Construction Costs, the amount of Nine Hundred Seventy Eight Thousand
Five Hundred ($978,500.00) Dollars (hereinafter referred to as the "Landlord's
Allowance") as hereinafter provided in Sub-paragraph 3 (c) and 3 (d). Tenant has
the right to seek competitive bids for the performance of Tenants Work as well
as future alterations during the Lease Term so long as the contractor and
subcontractors selected are acceptable to Landlord, which acceptance shall not
be unreasonably withheld or delayed. In the event a contractor other than an
affiliate of Landlord is selected, Tenant shall pay to Landlord a supervisory
fee which shall be limited to actual and reasonable costs for personnel and
materials.

                  (c) A portion of Landlord's Allowance, in an amount not to
exceed Eight Hundred Seventy Eight Thousand Five Hundred ($878,500.00) Dollars,
shall be paid in progress payments to Tenant during the progress of Tenant's
performance of Tenant's Work upon the written request of Tenant, which request
shall be accompanied by the following:

                                      -4-
<PAGE>   6
                                                                    Exhibit 10.8

                           (i) A Certificate signed by the architect or engineer
in charge of Tenant's Work, reasonably satisfactory to Landlord and any
construction lender supplying the funds, dated not more than five (5) days prior
to such request, setting forth the following:

                                    (A) That the sum then requested has been or
is to be paid by Tenant to contractors, subcontractors, materialmen, engineers,
architects or other persons who have rendered services or furnished materials in
connection with Tenant's Work therein specified, and giving a brief description
of such services and materials and the several amounts so paid to each of said
persons in respect thereof, and stating that no part of such expenditures has
been or is being made the basis in any previous or then pending request for the
withdrawal or has been previously made, and that the sum then requested does not
exceed the value of the services and materials described in the certificate.

                                    (B) That, except for the amount, if any,
stated pursuant to the foregoing subparagraph (A) in such certificate to be due
for services or materials, there is no outstanding indebtedness which is then
due for labor, wages, materials, supplies or services in connection with
Tenant's Work and which, if unpaid, might become the basis of a vendor's
mechanic's, laborer's or materialmen's statutory or similar lien upon the
Premises, or any part thereof, or upon Tenant's leasehold interest therein
(unless such lien is adequately bonded or insured against by a surety company
bond or title policy free and clear of liens, by a company and in form,
substance and amount reasonably satisfactory to Landlord).

                           (ii) Progress payments shall be made to Tenant in
accordance with the reasonable requirements of First Fidelity, not later than
thirty (30) days after Landlord's receipt of Tenant's written request for the
Landlord's Allowance funds.

                           (iii) A copy of Tenant's general contract with its
general contractor and copies of any Change orders (as hereinafter defined)
since the prior progress payment. The term "Change Orders" shall mean any
written and signed amendments or modifications to Tenant's plans or general
contract with its contractor.

                           (iv) Such other documentation, affidavits and
certificates as are required by Landlord's construction or permanent lender; it
being specifically understood that Landlord is receiving funds from its
construction or permanent lender in order to reimburse Tenant.

                  (d) The remaining One Hundred Thousand ($100,000.00) Dollars
of the Landlord's Allowance shall be paid to Tenant subsequent to the
Commencement Date and upon Landlord's receipt from Tenant of (a) a copy of the
final certificate of occupancy for the Premises, and (b) a written certificate
from Tenant's architect certifying that Tenant's Work has been completed in
accordance with Tenant's Plans. Tenant shall give Landlord written notification
of completion and Landlord shall have a reasonable time within which to inspect
the Tenant's Work and either approve or disapprove same. Landlord's approval
shall not be unreasonably withheld if Tenant's Work shall be performed in
accordance with Tenant's Plans, as approved by Landlord. If Landlord disapproves
the Tenant's Work or any portion thereof, Tenant shall promptly cause any
defects noted by Landlord in Tenants Work to be corrected. Promptly upon
completion of the

                                      -5-
<PAGE>   7
                                                                    Exhibit 10.8

Tenant's Work, Tenant shall furnish Landlord with an affidavit, in form
reasonably satisfactory to Landlord's counsel, from Tenant's general contractor
stating that all subcontractors, laborers and material suppliers who have
supplied labor and/or materials in connection with the Tenant's Work have been
paid in full and that the general contractor releases any and all liens with
respect to labor and materials supplied to the Premises for the Tenant's Work.
Landlord agrees to pay to Tenant the remaining one Hundred Thousand
($100,000.00) Dollars of the Landlord's Allowance within fifteen (15) days after
Tenant shall have provided Landlord with all of the items required by this
sub-paragraph (b). Any and all of Tenant's costs to construct the Tenant's Work
exceeding the allowance stated in sub-paragraph (b) shall be borne by Tenant.

                  (e) All Construction shall be in a good and workmanlike manner
and shall be in compliance with all applicable laws, ordinances, rules and
regulations of any duly constituted governmental authority having jurisdiction
thereof.

                  (f) If the Tenant Work is not substantially completed by
November 11, 1993 due to (1) the non-performance by the Landlord of its
obligations under 3.(a)(i)-(iv) above; (2) Landlord's failure to tender
possession of the Premises to Tenant on or before February 1, 1993; (3) any
other delay attributable to or caused by Landlord's acts or omission or those of
any of its employees, agents, contractors or invitees; or (4) Tenant's inability
to obtain a Certificate of Occupancy because of a pre existing condition, then
the Commencement Date shall be postponed one (1) day for each day the completion
of Tenant improvements is delayed beyond November 1, 1993 due to the foregoing
items (1) through (4).

                  (g) In addition to "Landlords Allowance" Landlord shall
provide an Additional Tenant Improvements Allowance in the amount of $26,750.00
per month for each month (which shall be prorated for any partial month)
subsequent to the commencement of the Lease and up to and ending the month of
June 1994 (hereafter referred to as "Additional Tenant Improvements Allowance").
Landlord shall pay to the Tenant the Additional Tenant Improvements Allowance no
later than the tenth (10th) day of each month following the Commencement Date
through and including June 1, 1994.

LANDLORDS' FINANCING.

         4. Landlord has received a Letter of Intent from First Fidelity Bank,
N.A. ("First Fidelity") which is attached hereto as Exhibit "C". This Lease is
contingent upon Landlords receipt and its acceptance of a formal written
mortgage commitment to the Landlord embodying the terms of the Letter except
with respect to the use of the Security to be posted by the Tenant, which
commitment shall embody in substance the provisions of Paragraph 30. If Landlord
has not received the commitment on or before January 22, 1993 and so advised the
Tenant in writing or if the Landlord has not accepted the commitment on or
before January 29, 1993 and so advised the Tenant in writing, then this Lease
shall be terminated and neither party shall have any claim against the other
except that the Landlord shall return to the Tenant the first months rent paid
by the Tenant to the Landlord pursuant to Paragraphs 5.(a)(i).

RENTAL.

         5. (a) Tenant covenants and agrees to pay to the Landlord the following
Rental:

                           (i) a base rent during the Term of this lease or any
extension as may be provided for herein (hereinafter called the "Base Rent") in
the sum stated in the Preamble payable by Tenant in equal monthly installments
as stated on or before the first day of each month, in advance, to Landlord at
the office of Landlord above designated or to such other place as shall be

                                      -6-
<PAGE>   8
                                                                    Exhibit 10.8

designated by Landlord, without any prior notice or demand therefor And without
any deduction, abatement or set off for any reason Whatsoever, except that the
first month's rent, shall be paid upon the execution of the Lease by Tenant;

                           (ii) All charges payable pursuant to this lease As
additional rental (hereinafter referred to as "Additional Rental");

                           (iii) In the event that the Commencement Date Shall
be other than the first day of a month, then the Tenant shall be given a credit
by the Landlord for the fractional portion of the first month of the Lease Term
prior to the Commencement Date on a per diem basis (calculated on the basis of a
thirty-day month) for Base Rent and Additional Rent paid by Tenant for such
period. Such credit shall be calculated by Landlord and issued to Tenant to be
used as a credit against a portion of the next months rent due.

                  Such Base Rent and Additional Rental are herein Referred to
collectively as "Rental"

                  (b) It is intended that the Rental provided for in this lease
shall be a net return to Landlord throughout the Term Hereof, free of any
expense, charge or other deduction whatsoever, with respect to the Premises, the
Building and/or the operation, management, maintenance, repair, use or
occupation thereof, or any Portion thereof, with respect to any interest of
Landlord therein, except only as otherwise expressly provided in this lease. Any
attempt by Tenant "to escrow: any rent due or similar self-help Shall constitute
a default.

                  (c) In the event that any payment of Rental due Hereunder is
not made on the date it is due, a late charge in the amount of five percent (5%)
for each dollar so overdue may be charged by the Landlord for each month or part
thereof that the same remains overdue. This charge shall be in addition to and
not in lieu of any other remedy the Landlord may have under the circumstances
and is in addition to any reasonable fees and charges of any agents or attorneys
Landlord may employ as a result of any default in the payment of Rental
hereunder, whether authorized herein or by law. Any such "late charges" if not
previously paid shall, at the option of the Landlord, be added to and become
part of the succeeding rental payment to be made hereunder and shall be deemed
to constitute additional Rental.

USE

         6. the Premises are to be used by Tenant for any permitted use, subject
to and in accordance with all rules, regulations, laws, ordinances and
requirements of all governmental authorities, the Fire Insurance Rating
Organizations and Boards of Fire Insurance Underwriters, and any similar bodies
having jurisdiction thereof, and for no other purpose. Landlord represents that
Tenants proposed use set forth in Paragraph II of the Preamble is a permitted
use in the Leased Premises under the applicable zoning, health, fire, building,
environmental and all other governmental regulations. Landlord represents and
warrants to Tenant that, at the commencement Date, the Premises shall be in
compliance with all applicable governmental laws, orders, regulations and codes
(collectively the "laws") applicable to the Premises including without
limitation building, zoning, environmental and health laws and the Americans
with Disabilities Act; that the Premises do not violate and Landlord has
received no notice of any violations, of any such laws and that all taxes have
been paid to date; and that Landlord knows of no pending

                                      -7-
<PAGE>   9
                                                                    Exhibit 10.8

assessments or liens on the Premises.

INSURANCE.

         7.       (a) Tenant shall provide, on or before the earlier of Tenant's
entry in the Premises or the Commencement Date, and keep in force, at all times
during the Term, at its sole cost and expense, a comprehensive public liability
insurance policy, in the names of and for the mutual benefit of Landlord and any
of its designees (without any obligation to pay premium) and Tenant, insuring
the Landlord and Tenant against any claim or liability for personal injury to or
death of any persons, and/or damage to property occurring in, on or about the
Premises, or any appurtenances thereto. Such policy shall contain a "Landlord
Protective Liability" endorsement and shall provide for limits of liability
thereunder of not less than One Million ($1,000,000.00) Dollars in respect to
personal injury or death to any one person, One Million ($1,000,000.00) Dollars
in respect to personal injury or death to any number of persons and Five Hundred
Thousand ($500,000.00) Dollars in respect to property damage. The limit of any
such insurance shall not limit the liability of the Tenant hereunder.

                  (b) Landlord agrees to obtain and keep in full force and
effect, at all times during the Term, at Tenant's sole cost and expense,
policies of insurance covering the Building and improvements made by the
Landlord to the Premises against all risks to physical damage with extended
coverage, in amounts equal to the full replacement value of such improvements,
without any co insurance; rental insurance sufficient to include both Base and
Additional Rental; and such other insurance coverages as Landlord may deem
necessary or proper, all of which insurance coverages shall be in such amounts
and with such companies as Landlord may deem reasonable and proper. The cost of
any such insurance shall be paid as Additional Rental pursuant to Paragraph 20
hereof.

                  (c) Landlord shall not provide any insurance covering the
Tenant's possessions or business operations. Tenant agrees to obtain, at its
sole cost and expense, an insurance policy covering its contents and a liability
policy covering its business operations which shall include contractual
liability.

                  (d) Landlord and Tenant agree that the insurance policies to
be obtained hereunder shall provide that the insurance carriers shall waive all
rights of subrogation against Landlord and Tenant and that such policies shall
not be invalidated should the insurance waive in writing prior to a loss any or
all right of recovery against any party for losses covered by such policies.
Landlord and Tenant hereby waive and release any and all right of recovery which
it might otherwise have against the other, their agents and employees, for all
injury and for loss or damage to its business, contents, furniture, furnishings,
fixtures and other property of the Landlord or Tenant, notwithstanding that such
injury, loss or damage may result from the negligence or fault of Landlord or
Tenant, their agents, or employees, provided that no such waiver or release
shall operate to invalidate any insurance coverage.

                  (e) Tenant agrees to deliver to Landlord, at least fifteen
(15) days prior to the time such insurance is first required to be carried by
Tenant, and thereafter at least fifteen (15) days prior to the expiration of any
such policy, either a duplicate original or a certificate of insurance and a
true copy of all policies procured by Tenant in compliance with its obligations
hereunder, together with evidence of payment therefor. All such policies shall
provide for notice of cancellation to be provided thirty (30) days prior to any
cancellation.

INCREASE OF INSURANCE RATES.

         8. Tenant agrees, at its sole cost and expense, to

                                      -8-
<PAGE>   10
                                                                    Exhibit 10.8

promptly comply with all of the rules and regulations of the Insurance Service
Organization of New Jersey having jurisdiction, or any similar body. If, at any
time, as a result of or in connection with any failure by Tenant to comply with
the foregoing provision, or as a result of any act or omission or commission by
Tenant, its employees, agents, contractors, invitees, licensees or subtenants,
or as a result of or in connection with the use to which the Premises are put,
notwithstanding that such use may be for the purpose herein permitted or that
such use may have been consented to by Landlord, any insurance rate applicable
to the Building and/or to the contents thereof, shall be higher than that which
would be applicable for the least hazardous types of occupancy legally permitted
therein, then and in any of such events, Landlord shall have the right to treat
as additional rent, the added premium if Tenant fails to cease the conduct
causing such increase within thirty (30) days of notice from Landlord. Tenant
shall not use nor install any electrical equipment that overloads the lines in
the Building and Tenant, at its sole cost and expense, shall promptly make
whatever changes are necessary to prevent or remedy such condition and to comply
with all requirements of Landlord, the Board of Fire Insurance Underwriters or
any similar body and any governmental authority having jurisdiction thereof. For
the purposes of this Paragraph, any finding or schedule of the Fire Insurance
Rating organization or any similar organization having jurisdiction shall be
deemed to be conclusively binding on the parties hereto.

FIRE AND OTHER CASUALTY.

         9.       (a) In case of fire or other casualty, Tenant shall give
immediate notice to Landlord. In the event the Premises shall be partially
damaged by fire, the elements or other casualty, but shall not be so destroyed
or damaged as to substantially impaired the ongoing conduct of Tenant's
business, then the Landlord shall repair the same within ninety (90) days of
such casualty to the extent of the scope of Landlord's work in the original
construction of the Premises, and if any portion of the Premises shall be
rendered untenantable, then the Tenant's obligation to pay Rental hereunder
shall abate in the same proportion which the square footage of the portion
rendered untenantable bears to the total square footage of the Premises until
such time as the Landlord shall have substantially repaired the Premises. In the
event that through no fault of the Tenant, its agents, servants, employees,
contractors or invitees, the Tenant's use of the Premises is substantially
impaired and, the Landlord does not give notice to the Tenant within thirty (30)
days of the fire or other casualty that the Premises will be restored and the
Tenant's use will not be substantially impaired except as to the replacement of
Tenant's fixtures, laboratory and/or other personal property within one hundred
twenty (120) days of the date of the notice, or if the Premises are not
substantially restored and the Tenant's use will not be substantially impaired
except as to the replacement of Tenant's fixtures, laboratory and/or other
personal property during such one hundred twenty (120) day period, the Tenant
shall have the right to terminate this Lease on thirty (30) days written notice
delivered to Landlord. In the event the Landlord elects to restore the Premises
as stated, then the lease shall remain in full force and effect, the Rental
payments shall be reduced as aforesaid, and the Landlord shall proceed
diligently to rebuild the Building and/or to restore the Premises.

                  (b) However, there shall not be any abatement, reduction or
moratorium of rent if the fire or other casualty or damage shall be the result
of gross negligence or improper conduct of of Tenant or its agents, employees,
guests, licensees, invitees, subtenants, assignees or successors. In any such
case, Tenant's liability for the payment of the Rental and the performance of
all the covenants, conditions and terms hereof on its part to be performed shall
continue and Tenant shall be liable to Landlord for the damage or loss suffered
by Landlord. If Tenant shall have been insured against any of the risks herein
covered, then the proceeds of such insurance shall be paid over to Landlord to
the extent of Landlord's costs and expenses and for any other damage or loss

                                      -9-
<PAGE>   11
                                                                    Exhibit 10.8

suffered by Landlord as a result of such casualty.

                  (c) For purposes of determining substantial imparement,the
Landlord and Tenant agree that a casualty shall include a material violation of
any Environmental Law (as hereinafter defined) and as the obligations are
assumed pursuant to Paragraph 45.

REPAIRS AND MAINTENANCE.

         10. (a) Except as provided in Paragraph 10(c) hereof, Tenant, at its
sole cost and expense, shall (1) maintain and repair the structural portions (as
hereinafter defined) of the Premises, (2) maintain, repair, and replace each and
every other part of the Leased Premises including, without limitation, painting
and decorating and the heating, ventilating, plumbing, electrical, sprinkler,
elevator and air conditioning units or systems in the Building, and (3) shall
not cause nor permit any dirt, debris or rubbish to be put, placed or maintained
on the sidewalks, driveways, parking lots, yards, entrances and curbs, in, on or
adjacent to the Building. Tenant further agrees not to use the Premises or
permit the Premises to be used in any manner as to cause excessive depreciation
of or to the Building and improvements,and agrees not to cause nor permit waste
of or damage or nuisance to, in, or about the Premises or the Building.

                  (b) Tenant shall not make any alterations, improvements,
and/or additions to the Premises or any part thereof exceeding $25,000.00 (non
structural), nor install or attach any heavy equipment or apparatus, without
Landlord's prior consent which consent shall not be unreasonably withheld or
delayed in accordance with the provisions of this lease.

                  (c) Landlord, upon reasonable notice from Tenant and provided
further that Landlord cannot repair same, shall make, at Landlords cost and
expense, necessary replacements to the structural portion of the Premises,
excluding, however, all windows, doors, plate glass, signs which shall be
maintained, repaired and replaced by the Tenant and all repairs required by any
casualty except as otherwise provided in Paragraph 9 and 13 hereof. For the
purpose of this lease, "structural" shall be defined as the steel, footings,
foundations, masonry walls, elevators, roof and floors of the Leased Premises.
Landlord shall also repair or replace any condition in the Leased Premises
required to be repaired or replaced by any agency of the Borough of Ramsey which
is discovered during the completion of Tenant's work which relates to a
condition in the Leased Premises which should have been repaired or replaced
prior to the commencement of Tenant's Work as a part of the Landlord obtaining
the Certificate of Continued Occupancy which the Landlord has delivered to the
Tenant. Any repairs, whether structural or otherwise, resulting from damage
caused by any act, omission or negligence of Tenant, any subtenant or
concessionaire, or their respective employees, agents, invitees, licensees or
contractors shall be performed by the Landlord at the sole cost and expense of
the Tenant and shall be deemed to constitute Additional Rental.

                  (d) Tenant further agrees to maintain, repair, secure, and
keep in good order and condition, reasonably clean and free from snow, dirt and
rubbish, all public or common areas surrounding the Building which are the
property of the Landlord, except as otherwise herein provided, and agrees to
furnish all necessary utilities to such public or common areas. The costs and
expenses incurred by Tenant for maintenance, repairs, utilities, janitorial
service, refuse and snow removal and security of the public or common areas
shall be determined in the sole discretion of Tenant, to ensure the proper
quality and the preservation of the reputation of the Building. Tenant may elect
to have the Landlord undertake Tenants responsibilities under this sub-paragraph
10 (d) by so advising the Landlord sixty (60) days in advance of the date that
Tenant wishes the Landlord to do so. In that event, the Tenant shall pay all
reasonable costs and expenses so incurred by

                                      -10-
<PAGE>   12
                                                                    Exhibit 10.8

Landlord, as Additional Rental, in accordance with the provisions of Paragraph
20 hereof.

                  (e) Tenant shall have the right of access to the roof of the
Building and to install, repair, place or replace any aerial, fan, air
conditioner or other device on the roof of the Building without the prior
written consent of Landlord. Tenant shall repair at Tenant's expense, any damage
to the Building or roof resulting from the installation, repair, use, or
replacement of any such air conditioner or other device.

COVENANTS AGAINST LIENS.

         11. (a) Tenant shall not do any act, nor make any contract which may
create any lien or other encumbrance upon the Building or Premises, nor permit
nor suffer same to remain, as a result of any labor, work, services or materials
performed, supplied or furnished for or to the Tenant or the Premises. If,
because of any act or omission (or alleged act or omission) of Tenant, any
mechanic's or other lien or encumbrance shall be filed against the Building or
Premises, whether or not such lien or encumbrance is valid or enforceable as
such, Tenant, at its sole cost and expense, shall cause same to be discharged of
record or bonded, within thirty (30) days after notice to Tenant of the filing
thereof; and Tenant shall indemnify and save harmless Landlord against and from
all damages, costs, liabilities, suits, penalties, claims and demands, including
reasonable counsel fees, resulting from the creation of such lien or
encumbrance. In the event Tenant fails to so comply, Landlord shall have the
option of discharging or bonding any such lien or encumbrance, and Tenant agrees
to reimburse Landlord for all costs, legal and other expenses incurred in
connection therewith, together with interest at an annual rate equal to two (2%)
percent above the annual interest rate extended by Citicorp to its most favored
borrowers, promptly upon demand, which sums shall be deemed to constitute
Additional Rental. All materialmen, contractors, artisans, mechanics, laborers
and any other persons now or hereafter contracted by Tenant for the furnishing
of any labor, services, materials, supplies or equipment, at any time from the
date hereof until the end of the Term, are hereby charged with notice that they
must look exclusively to Tenant to obtain payment for same.

                  (b) Nothing in this lease shall be deemed to be, or construed
in any way as constituting, the consent or request of Landlord, expressed or
implied, by inference or otherwise, to any person, firm or corporation for the
performance of any labor or the furnishing of any materials for any
construction, rebuilding, alteration, addition or repair of or to the Premises
or any part thereof, nor as giving Tenant any right, power or authority to
contract for or permit the rendering of any services or the furnishing of any
materials which might in any way give rise to the right to file any lien against
Landlord's interest in the Building. Landlord shall have the right to post and
keep posted at all reasonable times on the Premises any notice which Landlord
shall deem necessary so to post for the protection of Landlord and the Building
from any such lien.

ALTERATIONS.

         12. (a) Tenant shall not make, or cause, or permit the making of any
repairs, alterations, additions, or improvements in or to the Premises without
obtaining Landlord's prior written consent thereto in each instance. In the
event any such work shall cost in excess of Twenty Five Thousand ($25,000.00)
Dollars, such work shall not be commenced until Tenant shall submit to the
Landlord plans and specifications relating to any such repairs, alterations,
additions or improvements, and all such work shall be

                                      -11-
<PAGE>   13
                                                                    Exhibit 10.8

performed in accordance with the provisions of this Lease. Landlord shall not
unreasonably withhold its consent to any such alteration, addition or
improvement, but shall have the right to determine if such work would reduce the
value, size or general utility of the Building or any portion thereof, or
whether such work maintains the architectural harmony of the Building. Any
approval by Landlord as aforesaid may be upon condition that Tenant furnish the
Landlord such evidence of Tenant's financial ability to assure completion
thereof and payment therefore as Landlord may reasonably require, including the
furnishing of adequate security. All such repairs, alterations, additions or
improvements, not removed by Tenant at end of Term, shall belong to and become
the property of the Landlord. Tenant shall have the right to remove all fixtures
equipment, furnishings and Tenant Improvements not permanently affixed to the
Building and all above standard and laboratory improvements (whether or not
permanently affixed) approved by Landlord prior to the expiration or other
termination of this Lease but shall repair all damage caused by such removal and
restore the Premises to a condition suitable for painting (not necessarily
"paint ready" as that term is commonly used) and carpeting (i.e. walls repaired
and spackled, floors cleaned and holes repaired). Nothing herein contained
shall be construed in any way to restrict Tenant's right to make any
alterations, additions or improvements in Tenant's own movable trade fixtures.

                  (b) Any work performed by Tenant, irrespective of cost, shall
be subject to the Landlord's inspection and approval after completion to
determine whether it complies with the requirements of this lease. The approval
or consent of the Landlord shall not relieve Tenant of its obligation that all
such repairs, alterations, improvements and/or additions be constructed and
performed in a first-class good and workmanlike manner and in accordance with
all applicable governmental and fire underwriting requirements, nor constitute a
waiver of any rights of Landlord if Tenant fails to perform its obligations.
Tenant, at its sole cost and expense, shall procure all necessary governmental
approvals, permits or certificates in connection with all work performed by
Tenant in, on or at the Premises and shall deliver the original of all such
approvals, permits or certificates to the Landlord, to be retained by Landlord.

                  (c) During the course of any and all repairs, alterations,
additions or improvements which the Tenant shall either be required to perform
or which the Tenant shall elect to perform Tenant, at its sole cost and expense,
shall at all times obtain and maintain or cause to be obtained and maintained,
workmen's compensation insurance and any other insurance which shall then be
required by law, together with public liability insurance as set forth in
Paragraph 7 hereof, to insure against any additional hazards created in
connection with the performance of any of the aforesaid work. Prior to the
commencement of any such work, Tenant shall deliver to Landlord copies of all
policies or certificates of insurance with respect to all policies required
pursuant to this Paragraph 12(c).

CONDEMNATION.

         13. (a) In the event that the whole of the Premises

                                      -12-
<PAGE>   14
                                                                    Exhibit 10.8

shall be taken for any public or quasi-public use under any statute or by right
of eminent domain, or by private purchase in lieu thereof, then this lease shall
automatically terminate as of the Date that title shall be taken. In the event
that a part of the Premises shall be so taken as to render the remainder thereof
unusable for the purpose for which the Premises are leased, then Landlord and
Tenant shall each have the right to terminate this lease on thirty (30) days'
written notice to the other, given within sixty (60) days following the date of
such taking. In the event that this lease shall terminate or be terminated, the
Rental hereunder shall be equitably adjusted as of the date of termination.

                  (b) In the event that a part of the Premises shall be so taken
and this lease shall not terminate or be terminated pursuant to the provisions
of subparagraph (a) above, then the Rental shall be equitably apportioned
according to the square footage of the Premises so taken and this lease, in all
other respects, shall remain in full force and effect, and Landlord, at its own
cost and expense, shall restore the remaining portion of the Premises in a
manner substantially similar to the Building as it pre-existed the taking. If
the Landlord does not complete the restoration within one hundred twenty
(120)days of the physical taking, then and in that event, either the Landlord or
the Tenant may terminate this Lease on thirty (30) days written notice to the
extent necessary to render it reasonably suitable for the purpose for which the
Premises were leased, provided that such work shall not exceed the scope of the
work required to be done by Landlord in originally constructing the Premises and
provided the cost thereof shall not exceed the proceeds of its condemnation
award for consequential damages.

                  (c) All compensation awarded or paid upon such a total or
partial taking of the Building or the Premises shall belong to and be the
property of Landlord, and without any sharing by Tenant, whether such
compensation result from diminution in value of the leasehold or to the fee
interest in the Premises. Tenant however, shall have the right to seek and
prosecute any claim directly against the condemning authority in such
condemnation proceedings for moving expenses, inventory and/or movable trade
fixtures, Tenant's improvements beyond those paid for by the Landlord's
Allowance, furniture and other personal property belonging to Tenant, so long as
such claim shall not diminish or otherwise adversely affect Landlord's award or
the award of any mortgagee.

                  (d) Tenant agrees to execute and deliver such instruments as
may be deemed necessary or required to expedite any condemnation proceedings or
to effectuate a proper transfer of title to such governmental or other public
authority, agency, body or public utility seeking to take or acquire the
Premises or any portion thereof. Tenant covenants and agrees to vacate the
Premises, remove all of its personal property therefrom and deliver up peaceable
possession thereof to Landlord or to such other party designated by Landlord in
the event of condemnation of the entire Premises. Failure by Tenant to comply
with any provision hereof shall subject Tenant to such costs, expenses, damages
and losses as Landlord may incur by reason of Tenant's breach hereof.

ACCESS AND RIGHT TO EXHIBIT.

         14. (a) Landlord and its designees shall have the right to enter upon
the Premises at all reasonable hours upon twenty four (24) hours prior notice to
Tenant (and in emergencies at all times):

                           (i) to inspect the same;

                           (ii) to make repairs, additions or alterations

                                      -13-
<PAGE>   15
                                                                    Exhibit 10.8

to and/or to complete initial construction of, the Premises and/or to the
Building or to prevent waste or depreciation thereof;

                           (iii) to post "For Sale" signs on the Premises at a
location in the front of the building to be reasonably approved by Tenant and to
exhibit the Premises to any prospective purchaser or mortgagee upon twenty four
(24) hours prior notice to Tenant.

                  This Paragraph shall not be deemed to be a covenant by
Landlord nor be construed to create an obligation or duty on the part of
Landlord to make such inspection, repairs, additions or alterations except as
otherwise herein provided. Any performance by Landlord hereunder shall not be
deemed a waiver of Tenant's default in failing to perform same, nor shall
Landlord be liable for any reasonable and limited inconvenience, disturbance,
loss of business, loss of use of the Premises, and the obligations of Tenant
pursuant to this lease shall not thereby be affected in any manner whatsoever.
Landlord agrees to exercise due care to cause the least reasonably possible
interference with Tenant's business, but Landlord shall not be required to
employ labor on weekends or on an overtime basis to avoid or reduce any such
interference.

                  (b) For a period commencing one hundred eighty (180) days
prior to the end of the Term, Landlord and its designees shall have reasonable
access to the Premises for the purpose of exhibiting the same to prospective
tenants and to post any "To Let," or "To Lease" signs upon the Premises at a
location in the front of the building approved by Tenant, which approval shall
not be unreasonably delayed or withheld.

                  (c) Landlord shall have the right to carry material in and on
the Premises and to perform work in or on the Premises pursuant to the
provisions of this lease, without the same constituting an actual or
constructive eviction to Tenant, in whole or in part. Rent shall be abated to
the extent that the Premises are rendered unusable for Tenant's business.

ASSIGNMENT AND SUBLETTING.

         15. Except to a parent, subsidiary or affiliate of Tenant, Tenant shall
not either voluntarily, or by operation of law, assign, transfer, mortgage,
pledge, hypothecate or encumber this Lease or any interest therein, and shall
not sublet the Premises or any part thereof, or any right or privilege
appurtenant thereto, or allow any other person (the employees, agents, servants
and invitees of Tenant excepted) to occupy or use their Premises, or any portion
thereof, without first obtaining the written consent of Landlord, which consent
shall not be unreasonably withheld or delayed. When Landlord's consent is not
required, Tenant shall remain primarily obligated under the Lease, or provide
any necessary guarantees requested by Landlord or its mortgagee. When Tenant
requests Landlord's consent to such assignment or subletting, it shall notify
Landlord in writing of the name and address of the proposed assignee or
subtenant and the nature and character of the business of the proposed assignee
or subtenant and shall provide financial statements for the proposed assignee or
subtenant. If Landlord approves an assignment or subletting as herein provided,
Tenant shall pay to Landlord, as Additional Rent, fifty percent (50%) of the
difference, after deduction for the leasing expenses incurred by Tenant
including without limitation costs of fit-up, construction, brokerage and legal
expenses advertising, if any, between the Rent plus Additional Rent allocable to
that part of the Premises affected by such assignment or sublease pursuant to
the provisions of this Lease, and the Rent and Additional Rent payable by the
assignee or sublessee to Tenant. A consent to one assignment, subletting,
occupation or use shall not be deemed to be a consent to any other or subsequent
assignment, subletting, occupation or use and consent to any assignment or
subletting shall in no way relieve Tenant of any liability under this Lease.
Except as provided herein, any assignment or subletting without Landlord's
consent shall be void, and shall, at the option of the Landlord, constitute a
default

                                      -14-
<PAGE>   16
                                                                    Exhibit 10.8

under this Lease. In the event that Landlord shall consent to a sublease or
assignment hereunder, Tenant shall pay any brokerage fees related to the
subletting or assignment of the Premises.

RULES AND REGULATIONS, COMPLIANCE WITH LAWS.

         16. (a) Tenant agrees, at all times during the Term hereof, and at its
sole cost and expense:

                           (i) not to continue after thirty (30) days notice
from Landlord, any action which would violate Landlord's union contracts, if
any, affecting the Building or the Premises, or which would create any work
stoppage, picketing, labor disruption or dispute, or which would damage, delay
or interfere with any work performed or to be performed by Landlord or by any
other persons in or about the Building, or which hinder the activities or
operations of the Landlord in bringing about the cessation of any work stoppage,
picketing or other labor disruption or dispute affecting the Building or any
work being performed or to be performed in or about the Building;

                           (ii) to pay promptly and when due, all taxes,
licenses, fees, assessments or other charges levied or imposed upon the business
of Tenant or upon any fixtures, furnishings or equipment in, on or at the
Premises;

                           (iii) not to commit any waste or nuisance, nor use
the plumbing facilities for any purpose injurious to same or dispose of any
garbage or any other foreign substance therein, nor place a load on any floor in
the Premises exceeding the floor load per square foot which such floor was
designed to carry, nor install, operate and/or maintain in the Premises any
heavy equipment except in a location approved by Landlord, nor install, operate
and/or maintain in the Premises any electrical equipment which will overload the
electrical system therein, or any part thereof, beyond its capacity for proper
and safe operation as determined by Landlord or which does not have
Underwriter's approval.

                           (iv) to keep the Premises in a neat, clean, orderly
and sanitary condition,

                           (v) to comply with all requirements of all suppliers
of public utility services to the Building and not to suffer or permit any act
or omission the consequence of which could be to cause the interruption,
curtailment, limitation or cessation of any utility service to the Building;

                           (vi) to retain trash, rubbish and garbage created by
the Tenant, its representatives, guests, licensees,or invitees within the
demised Premises until removed from the site at Tenant's expense.

                  (b) Tenant further agrees, at its sole cost and expense, to
promptly comply, or cause compliance, with all laws, ordinances, orders, rules,
regulations and requirements collectively "Laws")of all federal, state, county
and municipal governments, and appropriate departments, commissions, boards and
offices thereof, foreseen or unforseen, ordinary as well as extraordinary, and
whether or not the same shall presently be within the contemplation of the
parties hereto or shall involve any change of governmental policy in so far as
said laws relate and are triggered by Tenant's particular use and do not
otherwise apply to buildings used for office, warehouse and research. Landlord
shall cure any violations arising from Landlord's original failure to comply
with laws, ordinances, orders, rules, regulations and requirements presently
applicable to the construction of the Building and shall comply with all Laws
applicable to office, warehouse, research (as in existence at Commencement Date
and in general and not due to Tenant's particular use.

                  (c) No abatement, diminution or reduction of the

                                      -15-
<PAGE>   17
                                                                    Exhibit 10.8

Rental or other charges required to be paid by Tenant pursuant to the terms of
this lease, shall be claimed by or allowed to, the Tenant for any inconvenience,
interruption, cessation or loss of business or otherwise caused directly or
indirectly by any present or future laws, rules, requirements, orders,
directions, ordinances or regulations of the federal, state, county or municipal
government, or of any other governmental or lawful authority whatsoever, caused
by legally required changes in the construction, equipment, operation or use of
the Premises.

                  (d) Tenant, following notice to Landlord, shall have the right
to contest by appropriate legal proceedings, at its sole cost and expense, the
validity of any law, ordinance, order, rule regulation or requirement of the
nature herein referred to, provided, however, that:

                           (i) any noncompliance shall not constitute a crime on
the part of the Landlord or otherwise adversely affect, jeopardize or threaten
the interest of Landlord;

                           (ii) Tenant shall diligently prosecute any such
contest to a final determination by a court, department or governmental
authority having final jurisdiction and to keep Landlord advised in writing as
to all changes in status and determinations in connection with any such
proceedings; and

                           (iii) Tenant shall indemnify and save harmless
Landlord against any and all losses, costs, expenses, claims, penalties,
actions, demands, liabilities, judgments or other damages which Landlord may
sustain by reason of such contest or as a result of Tenant's failure or delay in
compliance. Landlord shall have the right, but not the obligation to contest by
appropriate legal proceedings, at Landlord's expense, any such law ordinance,
rule, regulation or requirement.

UTILITIES.

         17. Tenant agrees to pay as and when the same become due and payable,
all water rents, rates and charges, all sewer rents and all similar charges
assessed or charged to the Premises during the Term, if any, all charges for
electricity, gas, heat, steam, hot water, and other utilities supplied to the
Premises during the Term, together with cost of repair, maintenance, replacement
and reading of all meters measuring Tenant's use or consumption thereof, whether
supplied by Landlord or by a public or private utility company. Tenant's
electric charges will be paid directly to the utility company by Tenant,
however, in the event that Landlord shall supply any or all the aforesaid
services, the charges therefor shall be deemed Additional Rental and be
collectible as such on the first day of the following month. In no event shall
Landlord be responsible or liable for the failure to supply Tenant or for the
failure of the Tenant to receive, any utility service if such failure is due to
reasons beyond Landlord's control, nor shall Tenant be entitled to any
cessation, abatement, reduction or other offset of Rental in the event of any
failure to receive any utility service.

SIGNS

         18. Tenant may provide, install or maintain any exterior signs on the
roof or in the window; or provide, install or maintain any exterior signs on the
facade or walls of the Building or on any grounds adjacent thereto, provided all
such signs must at all times conform to all applicable rules, regulations, codes
and ordinances of any governmental agencies having jurisdiction thereover. All
such signs shall be provided, installed, maintained and removed at the
termination of the lease, at Tenant's sole cost and expense. Tenant further
agrees that it will not place any advertisements or other type of structure or
obstruction on the

                                      -16-
<PAGE>   18
                                                                    Exhibit 10.8

roof facade or walls of the Building and that it shall not operate any
loudspeaker or other device which can be heard outside of the Premises. In the
event that Landlord or its agents deem it necessary to remove any such signs in
order to paint or make any repairs, alterations or improvements in or upon the
Building or any part thereof, they may be so removed, but shall be replaced at
Landlord's expense when the said repairs, alterations or improvements shall have
been completed. Nothing contained in this Paragraph shall create any obligation
on the part of the Landlord to make any repairs, alterations or improvements.

TAXES.

         19. (a) Tenant covenants and agrees that it shall pay to Landlord, as
Additional Rental, its proportionate share of all real estate taxes,
assessments, added assessments and other governmental charges or substitutes
therefor, foreseen or unforeseen, levied, imposed, assessed or fixed on or
against the Building and land constituting the entire tax lot on which the
Building is constructed or arising from the use, occupancy or possession
thereof, during the Term hereof (hereinafter collectively referred to as the
"Taxes"). The proportionate share of Taxes to be paid by Tenant is set forth in
Paragraph 20 of this lease.

                  (b) Landlord shall have the right to contest in good faith any
such tax, assessment or added assessment and all costs and expenses, including,
but not limited to, all legal fees, shall be deemed to constitute additional
charges for which Tenant shall pay its proportionate share, as set forth in
Paragraph 20 hereof. Tenant shall pay its share of all such costs and expenses,
as Additional Rental, on the first day of the month following demand therefor.
Provided that the Tenant shall have paid its proportionate share of all costs
and expenses in accordance with the provisions of this Paragraph 19(b), Tenant
shall be entitled to the same proportionate share of the net proceeds of any
refund received by the Landlord as a result of such contest. Landlord agrees to
notify Tenant of the filing of any tax appeal or contest, not later than 15 days
prior to the filing deadline for which an such appeal is to be taken.

                  (c) In the event that Landlord shall fail to so notify Tenant,
then and in such event, Tenant shall have the right to contest in good faith any
such tax, assessment or added assessment, at its own cost and expense, provided,
however, that notwithstanding such contest, Tenant at all times: shall when due,
pay its proportionate share thereof; shall comply with all applicable laws,
rules and regulations regarding the payment of taxes; shall not take any action
which would adversely affect, threaten or jeopardize the interest of the
Landlord in the Building or land; shall promptly pay, indemnify and save
Landlord harmless from, all penalties and interest which may be charged or
imposed as a result of or during the pendency of, any such contest. In the event
of any such contest by the Tenant, Landlord agrees to reasonably cooperate and
to execute any necessary papers, provided however, that the same shall be
without any cost or expense to the Landlord. However, nothing herein shall
require the Landlord to withhold the payment of any tax, interest or penalty
otherwise due and owing to, or charged by, the taxing authority.

                  (d) It is further agreed that for the first and last Lease
Years of the Term hereof, the portion of all Taxes, other than such as result
from added assessments, to be paid by the Tenant shall be pro rated, depending
on the proportion which each such Lease Year shall bear to the tax year in which
it falls. The portion of Taxes resulting from added assessments to be paid by
Tenant during the first and last Lease Years of the Term shall be pro rated
depending on the proportion which such Lease Year shall bear to the portion of
the tax year for which the added assessment is charged.

                  (e) If at any time during the Term hereof, pursuant to the
laws of the Municipality, the County of Bergen, the State

                                      -17-
<PAGE>   19
                                                                    Exhibit 10.8

of New Jersey or the United States of America, a tax or excise on rents or other
tax, however described, is levied or assessed by any Municipality, County, State
or Country or any political subdivision thereof, against the Landlord or the
Rental reserved hereunder, or any part thereof, as a substitute, in whole or in
part, for any revenues derived from any tax assessed or imposed by any such
political entity on land and buildings, the Tenant covenants to pay to Landlord,
such sum as shall be necessary to pay and discharge such tax or excise on rents
or other tax, which sum shall be paid to Landlord in the manner herein set forth
for Taxes, provided, however, that the parties shall have the right to contest
said levy in the same manner as provided herein for Taxes.

                  (f) Except as otherwise provided herein, Tenant shall not be
obligated or required hereunder to pay any franchise, excise, corporate, estate,
inheritance, succession, capital levy or transfer tax of Landlord, or any
income, profit or revenue tax upon the income or receipts of Landlord.

                  (g) Tenant shall be responsible for and shall pay prior to the
time when such payment shall be deemed delinquent, all taxes assessed during the
Term against any leasehold interest, or any improvements, alterations,
additions, fixtures or personal property of any nature placed in, on or about
the Premises by the Tenant, whether such tax shall have been levied or assessed
against the Landlord or the Tenant after the Commencement Date or attributable
to Tenant's Work prior to the Commencement Date.

ADDITIONAL CHARGES.

         20. (a) In addition to all other rental charges provided for in this
lease, the Tenant agrees to pay as "Additional Rental," its proportionate share
of:

                           (i) all insurance premium costs incurred by Landlord,
if any, in connection with its obtaining and maintaining of fire, extended
coverage and all risk insurance; rental insurance sufficient to include both
Base Rent and Additional Rental; sprinkler damage insurance; and public
liability insurance, all of which insurance coverages, if maintained, shall be
in such amounts as are maintained by Landlord's comparable buildings and with
such companies as Landlord may deem reasonable or proper;

                           (ii) all costs and expenses incurred by Landlord in
connection with the Landlord's satisfying Tenants obligations for maintenance,
repair and replacements in and to the Leased Premises, in accordance with the
provisions of this Lease, including, all costs occasioned by Landlord in the
event the Tenant elects, pursuant to Sub-Paragraph 10(d), to have Landlord
undertake Tenant's responsibilities

                           (iii) in the event of Tenant electing to have
Landlord undertake its responsibilities pursuant to Sub-Paragraph 10 (d),
management fees for the operation of the Building, at an annual sum equal to
three (3%) percent of the total annual Base Rent for the building; and

                           (iv) Landlord represents that the 1993 estimated
cumulative Additional Rental, if Landlord undertakes Tenants responsibilities as
aforesaid, would be $1.70 per square foot. The items/services included in this
estimate are: real estate taxes, landscape maintenance, snow removal, site
lighting, irrigation, insurance, fire sprinkler alarm, management fees and
miscellaneous exterior repairs and maintenance. If Tenant elects that the
Landlord undertakes its responsibilities under Sub-Paragraph 10 (d), Landlord
agrees to limit increases in the total yearly Additional Rental to a maximum of
five (5%) percent per annum for the above listed items/services provided on a
recurring annual basis. Notwithstanding the foregoing, the aforesaid limitation
shall not apply to (1) increases in the cost of any of the above listed
items/services due to increases in the frequency of the performance of the above
listed items/services (e.g.,

                                      -18-
<PAGE>   20
                                                                    Exhibit 10.8

variation in snow removal costs in any calendar year as a result of excessive
snow falls) , and (2) additional items/services not listed above which may be
reasonably supplied by Landlord during the Term and (3) any items with costs
which are beyond the control of the Landlord (e.g., real estate taxes and
utility rates)

                  (b) It is acknowledged that the total annual Additional Rental
to be paid by the Tenant, pursuant to the provisions of Paragraph 19 and 20 of
this lease, cannot be determined except on an annual basis. It is therefore
agreed that, in addition to the payments of Additional Rental as may be provided
for elsewhere in this lease, the Tenant shall pay the estimated monthly sum set
forth in (10) of the Preamble on account of its Additional Rental obligations
pursuant to the provisions of Paragraphs 19 and 20 of this lease. Said estimated
payments shall be paid in advance, on the first day of each month, and shall be
based on an annual period from January 1 through December 31 during each year of
the Term hereof, and shall be adjusted annually within ninety (90) days
following the conclusion of each such annual period by written notice delivered
by Landlord to Tenant. Said notice shall set forth the total amount of the costs
and expenses incurred by the Landlord for such annual period, the sum which
represents the proportion to be paid by the Tenant, the sum actually paid by
Tenant for such period, and the amount of any required adjustment. Said notice
shall also set forth the estimated monthly payment to be paid by Tenant for the
following annual period.

                  (c) For the first and last Lease Years of the Term hereof, the
portion of Additional Rental to be paid by the Tenant other than for real estate
taxes, shall be pro rated depending on the proportion which each such Lease year
shall bear to the aforesaid annual period in which it falls.

NON-LIABILITY OF LANDLORD

         21. (a) Unless caused by Landlords gross neglect or Willful misconduct,
or the gross neglect or willful misconduct of Landlord's agents, employees,
guests, contractors, licensees, invitees, assignees or successors, Landlord
shall not be liable for any damage or injury which may be sustained by Tenant or
by any other person, as a consequence of the failure, breakage, leakage or
obstruction of the street or sub-surface; or of the water, plumbing, steam,
sewer, waste or soil pipes; or of the roof, walls, drains, leaders, gutters,
valleys, downspouts, or the like; or of the electrical, gas, power, conveyor,
refrigeration, sprinkler, air conditioning or heating systems; or of the
elevators or hoisting equipment; or of any other structural failure; or by
reason of the elements; or resulting from theft or pilferage; or resulting from
fire, explosion or other casualty; or resulting from the carelessness,
negligence or improper conduct on the part of the Tenant, any other tenant, or
of Landlord, their agents, employees, guests, licensees, invitees, subtenants,
assignees or successors; or attributable to any interference with interruption
of or failure, beyond the control of Landlord, of any services to be

                                      -19-
<PAGE>   21
                                                                    Exhibit 10.8

furnished or supplied by Landlord. All property kept, maintained or stored in,
on or at the Premises shall be so kept, maintained Or stored at the sole risk of
the Tenant. Notwithstanding anything Contained herein to the contrary, Landlord
shall remain liable for all latent defects and injury or damage that arise
therefrom.

         22. Intentionally Omitted

RIGHT TO CURE DEFAULT.

         23. In the event Tenant shall fail to comply fully with any of its
obligations hereunder, then Landlord shall have the right, at its option to cure
such breach, at Tenant's expense, upon twenty (20) days' prior written notice to
Tenant, except in cases of emergency (in which event no notice need be given),
and if Tenant shall fail to cure said default within such period, provided
however, that if said default cannot be cured with said period, then Tenant
shall have commenced in good faith to cure such default within said twenty (20)
day period and shall continue to curing thereof diligently thereafter. Tenant
agrees to reimburse Landlord promptly (as Additional Rental) for all costs and
expenses incurred as a result thereof or in connection therewith, together with
interest at an annual rate equal to two (2%) percent above the annual interest
rate extended by Citicorp to its most favored borrowers as of the date on which
the Landlord made such payment and which interest shall commence to run from the
date on which Landlord made any such payment. Any action so taken by Landlord
pursuant to this lease shall not serve to waive or release Tenant from its
performance of any obligation hereunder.

REMEDIES UPON DEFAULT.

         24. (a) In the event Tenant shall:

                           (i) default in the payment of the Rental reserved
herein or in making any other payment herein provided, said default continuing
for a period of ten (10) days after notice of said default; or

                           (ii) default in the observance of any of the other
material terms, covenants and conditions of this lease, which default continues
for thirty (30) days following the delivery of written notice thereof, ; except
that if such default is incapable of cure with thirty (30) days, if the Tenant
has not commenced a cure of the default and is not proceeding diligently to cure
same; or

                           (iii) assign, sublet or permit the Premises to be
occupied by someone other than Tenant, except as herein provided; or

                           (iv) make any assignment for the benefit of
creditors, file a voluntary petition in bankruptcy, be by any court adjudicated
a bankrupt, take the benefit of any insolvency act or be dissolved or
liquidated, voluntarily or involuntarily, or if a receiver or trustee of Tenant
and/or its property shall be appointed in any proceedings or if any Guarantor
hereunder shall cause or suffer any of such events to occur with respect to
itself or;

                           (v) suffer or permit any execution, attachment or
other similar process to issue against Tenant or a substantial portion of its
property or assets, or suffer or permit the Premises to be taken and/or occupied
or attempted to be taken and/or occupied by one other than the Tenant;

         then, upon the happening of any of the events set forth in this
Paragraph, Landlord shall have the right to terminate this lease and the Term
hereof upon not less than ten (10) days' written notice to Tenant, with the same
force and effect as though the date so specified were the date hereinabove first
set forth as the date

                                      -20-
<PAGE>   22
                                                                    Exhibit 10.8

of the expiration of the Term (but Tenant shall remain liable to Landlord as
hereinafter provided), and at the expiration of the period provided in said
notice, the Term hereof and all of the Tenant's right, title and interest
hereunder shall cease and terminate, and Landlord without further notice, may
reenter the Premises, remove the Tenant and its property therefrom, and have
possession and enjoyment of the same, and/or may recover possession thereof as
prescribed by law relating to summary proceedings or otherwise, without any
liability for damages or prosecution therefrom, it being understood that no
demand for the Rental, no reentry for condition broken and no notice to quit or
other notice prescribed by law shall be necessary to enable Landlord to recover
such possession, but that all rights to any such demand, reentry, notice or
other prerequisites are hereby expressly waived by Tenant.

                  (b) In the event of any such default, reentry, expiration
and/or dispossess:

                           (i)the Rental shall become due and be paid up to the
time of such reentry, dispossess and/or expiration, together with such costs and
expenses as Landlord may incur in reacquiring possession of the Premises, for
reasonable legal expenses, attorneys' and brokerage fees, putting or restoring
the Premises in or to good order and altering or preparing the same for
re-rental;

                           (ii) Landlord shall make reasonable efforts, to relet
the Premises or any part or parts thereof, either in the name of Landlord or
otherwise, for a term or terms which may, at Landlord's option be less than or
exceed the period which would otherwise have constituted the balance of the
Term, for such rental and on such terms as Landlord shall deem reasonable;

                           (iii) Tenant, or the legal representatives of Tenant,
shall pay Landlord any deficiency between the Rental hereby covenanted to be
paid and the net amount, if any, of the rents collected on account of any
reletting of the Premises for each month of the period which would otherwise
have constituted the balance of the Term. In computing such sum, there shall be
added to the Rental hereby covenanted to be paid, such expenses of Landlord as
are referred to in subparagraph (b) (i) of this Paragraph. Any such deficiency
shall be paid in monthly installments by Tenant on the first day of each
month, in advance, and any suit brought to collect the amount of the deficiency
for any month shall not prejudice in any way the rights of Landlord to collect
the deficiency for any subsequent month by a similar proceeding or by joining,
consolidating or otherwise including in one action, any and all claims for
subsequent periods;

                           (v) Landlord is hereby granted a lien, in addition to
any statutory lien or right to distrain which may exist, on all personal
property of Tenant in or on the Premises, to secure payment of the Rental and
performance of the terms, provisions, covenants and conditions of this lease.
Landlord shall have the right, as agent of Tenant, to take possession of any
furniture, fixtures or other personal property of Tenant found in or about the
Premises and sell the same at public or private sale and to apply the proceeds
thereof to the payment of any monies becoming due under this lease, Tenant
hereby waiving the benefit of all laws exempting property from execution, levy
and sale on distress or judgment. Tenant agrees to pay all legal expenses,
attorneys' and brokerage fees and all other costs and expenses incurred by
Landlord in exercising its rights hereunder or in Enforcing any of the
obligations of Tenant under this lease.

                  (c) Landlord may make such alterations, repairs replacements
and/or decorations in or on the Premises as it, in its sole judgment, considers
advisable or necessary for the purpose of reletting the Premises; and the making
of such alterations, repairs, replacements and/or decorations shall not operate
or be construed to relieve Tenant from its liability hereunder. Landlord shall
in no event be liable in any way whatever for any failure to

                                      -21-
<PAGE>   23
                                                                    Exhibit 10.8

relet the Premises, or in the event that the Premises are relet, for the
reasonableness of the rental or for the failure to collect any rent under such
reletting.

                  (d) In the event of a breach or threatened breach or violation
by Tenant of any of the covenants, conditions, terms or provisions of this
lease, Landlord shall have the right to obtain an injunction or to invoke any
remedy allowed at law or in equity, without limitation and in addition to, all
rights and remedies herein provided for.

                  (e) No receipt and acceptance of Rental by Landlord from
Tenant after the termination in any manner of this lease, or the performance by
Tenant of any obligation hereunder after the period stated in any notice given
pursuant to this lease, shall reinstate, continue or extend the lease or the
Term thereof, affect any such notice or cure any default theretofore arising
hereunder. No receipt of Rental after the commencement of suit, or after final
judgment for possession of the Premises, shall reinstate, cure, continue or
extend the lease or the Term thereof or affect said suit or said judgment.

                  (f) The rights and remedies of Landlord specified in this
lease, as well as the rights and remedies to which the Landlord is entitled by
law or in equity, are cumulative and are not intended to be exclusive of or
preclude the exercise of any other rights or remedies which may be available to
the Landlord in the event of a breach by Tenant of any provision of this lease.

                  (g) In no event shall the Tenant be entitled to receive all or
any portion of any net surplus monies obtained or received by Landlord either in
connection with any reletting or as a result of the exercise of any other right
or remedy to which Landlord may be entitled.

WAIVER OF REDEMPTION.

         25. Not used in this Lease.

MORTGAGE PRIORITY.

         26. This lease shall be and hereby is made subject and subordinate at
all times to the lien of all ground and underlying leases and to all mortgages
and all advances made thereon which may now or hereafter affect the Building,
and to all increases renewals, modifications, consolidations, participations,
replacements and extensions thereof, irrespective of the time of recording such
lien, without the necessity of any further instrument of subordination. In the
event, however, that Landlord or any lessor or mortgagee desires confirmation of
such subordination, Tenant shall promptly execute and deliver any certificate or
instrument that may be reasonably requested. Tenant's failure to deliver within
a reasonable time any such certificate or instrument shall be deemed a default
hereunder. Tenant shall not have the right to place any lien or encumbrance of
any kind against the Premises, or any of its fixtures, furniture, equipment or
improvements, other than a chattel mortgage on its movable trade fixtures.
Landlord agrees to cause any present mortgagee or holder of any interest in the
Leased Premises to deliver a non-disturbance agreement to Tenant, in their
customary form prior to the date of Delivery of Possession. Further, Landlord
agrees to cause any future ground lessor or mortgagee to deliver a
non-disturbance agreement by each ground lessor and/or mortgagee to Tenant in a
form substantially similar to Exhibit D attached hereto including the asterisk
addition to the foot thereof at or before the closing of the mortgage.

                                      -22-
<PAGE>   24
                                                                    Exhibit 10.8

SURRENDER OF PREMISES.

         27. On the expiration date or sooner termination of the Term, Tenant
shall quit and surrender the Premises to Landlord, in broom-clean good condition
and repair, reasonable wear and tear excepted, as well as all keys to the
Premises, together with all alterations, additions and improvements which may
have been made in, on or to the Premises, except for movable furniture and
equipment, or unattached movable trade fixtures put in at the sole expense of
Tenant. Tenant will not be required to remove any improvements made to the
Premises which have been approved by Landlord, unless Landlord had advised
Tenant of its obligation to do so at the time that Landlord granted its consent.
In the event Landlord had so advised, then Tenant, prior to the end of the Term,
at its sole cost and expense, shall so restore the Premises, remove therefrom
all of its property together with such alterations, additions and improvements
as may have been requested by Landlord, and fix and repair any and all damage or
defacement to the Building and/or lands caused by the installation and/or
removal of alterations, additions, improvements, furniture, equipment, trade
fixtures or any other property. Any or all of such property, alterations,
additions or improvements not so removed, at Landlord's option, shall become the
exclusive property of Landlord or be disposed of by Landlord at Tenant's cost
and expense, without further notice or demand. Tenant shall have the right to
remove its equipment, fixtures, furnishings and improvements affixed to the
Building, all laboratory fixtures and all above standard improvements (whether
or not permanently affixed) at the end of the Lease Term, but shall be obligated
to fix and repair any and all damage or defacement to the Building and/or lands
caused by their installation and/or removal and restore the Premises to a
condition suitable for painting (not meaning "paint ready" as that term is
commonly used) and carpeting (i.e. walls repaired and spackled, floors cleaned
and holes repaired). Tenant's obligation under this Paragraph shall survive the
expiration or sooner termination of the Term.

UNAVOIDABLE DELAYS.

         28. (a) If, as a result of strikes, lockouts, labor disputes, inability
to obtain labor, materials or reasonable substitutes therefor, acts of God,
governmental restrictions, regulations or controls, enemy or hostile
governmental action, civil commotion, insurrection, revolution, sabotage, fire
or other casualty, acts or failure to act by Tenant or any other tenant or other
conditions beyond the control of Landlord, whether prior to or during the Term,
Landlord shall fail punctually to perform any lease obligation, then and in any
of such events, such obligation shall be punctually performed as soon as
practicable after such condition shall abate. In the event that Landlord, as a
result of any such condition, shall be unable to exercise any right or option
within any time limit provided in this lease, such time limit shall be deemed
extended for a period equal to the duration of such condition. The failure of
Landlord to perform any lease obligation for the reasons set forth herein shall
not affect, curtail, impair or excuse this lease or the obligations of Tenant
hereunder.

                  (b) No diminution or abatement of rent, or other compensation,
shall be claimed or allowed for inconvenience or discomfort arising from the
making or repairs or improvements to the Building or to its appliances, or
arising from the construction of or repairs or improvements to, other buildings,
structures, lands or appliances, whether or not the same shall be owned by
Landlord. In respect to the various "services", if any, to be furnished by the
Landlord to the Tenant, it is agreed that there shall be no diminution or
abatement of the rent, or any other compensation, for interruption or
curtailment of such "service", when such interruption or curtailment shall be
due to accident, alterations or repairs necessary to be made or to inability or
difficulty in securing supplies or labor for the maintenance of such "service"
or to some other cause, not gross negligence on the part of the Landlord. No
such interruption or curtailment of any such "service" nor any non-performance
by Landlord pursuant to subparagraph (a) of this Paragraph, shall be deemed a
constructive eviction, nor shall there be any abatement or diminution of rent

                                      -23-
<PAGE>   25
                                                                    Exhibit 10.8

because of making of repairs, improvements or decorations to the Premises after
the date above fixed for the commencement of the Term.

LANDLORD CONSENT.

         29. With respect to any provision hereof which provides for the consent
or approval of Landlord, said consent or approval shall be in writing and shall
not be unreasonably withheld or delayed. Tenant in no event, shall be entitled
to make any claim. All expenses reasonably incurred by Landlord in reviewing and
acting upon any request for consent hereunder, including but not limited to,
reasonable attorneys' and architects' fees, shall be reimbursed by Tenant to
Landlord, shall be deemed to constitute Additional Rental and shall be paid over
to Landlord on the first day of the month following demand therefor.

ESCROW FOR FIT-UP.

         30. (a) Tenant, shall deposit with First Fidelity the sum set forth in
(8) of the Preamble, either in the form of a Letter of Credit, cash, escrow
account or other form of security in a manner reasonably acceptable to First
Fidelity at the closing of the Mortgage (or such later date as First Fidelity
may agree to) in trust for Tenant to be held by First Fidelity for the following
limited purposes: (1) to reimburse First Fidelity for any sums it has paid over
to the Landlord on account of "Landlords Allowance" which have been paid over to
Tenant in the event that (a) the Tenant fails to complete the Tenant's Work in
accordance with the terms of this Lease or (b) the Tenant defaults during the
Lease Term; (2) as security for the Tenant's compliance with Paragraph 47 of
this Lease but only to the extent of any sum paid over to the Landlord by First
Fidelity on account of "Landlord's Allowance" which have been paid over to
Tenant.

                  (b) In the event that Tenant is not in material default of the
terms, provisions, covenants and conditions of this lease, then Tenant shall
have the right to reduce the amount of the escrow deposit by ten (10%) percent
of the original escrow amount per year and any remaining escrow shall be
returned to the Tenant on the expiration of the Term hereof.

                  (c) Tenant shall be entitled to any interest on the aforesaid
escrow deposit held by First Fidelity in a segregated account. Tenant further
covenants that it will not assign or encumber or attempt to assign or encumber
the escrow deposited herein except as permitted under the provisions of
Paragraph 15 hereof, and that neither Landlord nor its successors or assigns
shall be bound by any such assignment, encumbrance, attempted assignment or
attempted encumbrance.

                  (d) It is expressly understood and agreed that the exercise of
any remedy by Landlord for any default on the part of Tenant shall no be deemed
such a termination of this lease as to entitle Tenant to the recovery of said
escrow and said escrow shall be retained and remain in the possession of First
Fidelity as hereinbefore stated.

CERTIFICATION.

         31. Tenant and Landlord each agree, without charge and at any time,
within ten (10) days after written request of the other, to certify by written
instrument duly executed, acknowledged and delivered to the other or any other
person, firm or corporation specified in such request:

                  (a) as to whether this lease has been modified or amended, and
if so the substance and manner of such modification or amendment;

                                      -24-
<PAGE>   26
                                                                    Exhibit 10.8

                  (b) as to the validity and force and effect of this lease;

                  (c) as to the existence of any default thereunder by Landlord
and Tenant;

                  (d) as to the existence of any offsets, counter claims or
defenses thereto on the part of Tenant;

                  (e) as to the commencement and expiration dates of the Term;

                  (f) as to the dates to which Rental payments have been made;

                  (g) as to any other matters as may reasonably be so requested.

         Any such certificate may be relied upon by Landlord and any other
person, firm or corporation to whom the same may be exhibited or delivered, and
the Tenant shall be bound by the contents of such certificate. The Tenant hereby
constitutes and irrevocably appoints the other as its attorney-in-fact to
execute any such instrument or other writing for and on behalf of the Tenant if
Tenant shall fail or refuse to execute the instrument within the aforesaid ten
(10) day period.

         Tenant further agrees to furnish to Landlord at any time, but not more
frequently than once per year, within ten (10) days after written request of
Landlord, a copy of its financial statement for its last full fiscal year,
certified by a corporate officer and prepared by independent Certified Public
Accountants, including, but not limited to, a profit and loss statement.

WAIVER OF TRIAL BY JURY.

         32. It is further agreed by and between the parties hereto that they
shall and do hereby waive trial by jury in any action, proceeding or
counterclaim brought by either of the parties hereto against the other on any
matters whatsoever arising out of or in any way connected with this lease, the
relationship of Landlord and Tenant, Tenant's use or occupancy of the Premises,
and/or any claim or injury or damage.

QUIET ENJOYMENT.

         33. Landlord covenants and agrees with Tenant that upon Tenant's paying
the Rental and observing and performing all of the terms, provisions, covenants
and conditions on its part to be observed and performed, Tenant may peaceably
and quietly enjoy the Premises during the Term hereof, subject however, to all
of the terms, conditions, covenants and provisions of this lease. In the event
of any breach by Landlord of this covenant, Tenant may, by not less than thirty
(30) days' written notice given to Landlord, cancel this lease, unless within
such thirty (30) day period, Landlord shall have commenced appropriate action to
cure such breach and shall thereafter proceed diligently to cure such breach.
Upon such cancellation, all rights of either party against the other shall cease
and the term shall expire with the same force and effect as if the date of such
cancellation were the date originally fixed herein for the expiration of the
Term.

LANDLORD.

         34. (a) The term "Landlord" as used in this lease means only the owner,
the holder of a lease or the mortgage in possession for the time being of the
Premises, so that in the event of any sale of the land and Building of an
assignment of this lease or any underlying lease, Landlord herein shall be and
hereby is entirely

                                      -25-
<PAGE>   27
                                                                    Exhibit 10.8

freed and relieved of all obligations of Landlord hereunder Provided such
purchaser, assignee or lessee has assumed and agreed in writing to observe and
perform all obligations of Landlord hereunder.

                  (b) Notwithstanding anything herein contained to the contrary,
it is specifically understood and agreed that there shall be no personal
liability on the part of the Landlord, its successors or assigns, with respect
to any of the terms, provisions, covenants and conditions of this lease, and
that Tenant shall look solely to the estate, property and equity of Landlord or
such successor in interest in the Building and subject to the prior rights of
any mortgagee or ground lessee, for the satisfaction of each and every remedy of
Tenant in the event of any breach by Landlord or by such successor in interest
of any of the terms, provisions, covenants and conditions of this lease to be
performed by Landlord, which exculpation of personal liability shall be absolute
and without exception.

NOTICES.

         35. All notices, demands or requests required under the terms of this
lease shall be given in writing by either party to the other and shall be
complete by personal delivery or by mailing such notices by certified or
registered mail, return receipt requested, to the Landlord at the address set
forth hereinabove, and to the Tenant at the Premises, or to such other address
as either party may designate in writing, which notice of change of address
shall be given in the same manner. Copies of any Notice of Default shall be
forwarded to Counsel: Smith, Stratton, Wise, Heher & Brennan, 600 College Road
East, Princeton, NJ 08540, Attn: Richard J. Pinto, Esq.

COVENANTS, EFFECT OF WAIVER.

         36. (a) Every term, condition, agreement or provision set forth in this
lease shall be deemed to also constitute a covenant.

                  (b) The waiver of any term, provisions, covenant or condition
by Landlord shall not be construed as a waiver of a subsequent breach of the
same or any other term, provision, covenant or condition, and the consent or
approval by Landlord to or of any act by Tenant requiring Landlord's consent or
approval shall not be construed to waive or render unnecessary Landlord's
consent or approval to or of any subsequent similar act by Tenant. The failure
of Landlord to insist in any one or more instances upon the strict performance
of any term, condition, provision, covenant or agreement or to exercise any
option or any right hereunder, shall not be construed as a waiver or
relinquishment of the same for the future. The receipt by Landlord of any Rental
payment or the acceptance by Landlord of the performance of anything required to
be performed by this lease, with knowledge of a breach of any term, condition,
provision or covenant of this lease shall not be deemed a waiver of such breach.
No term, condition, provision or covenant of this lease shall be deemed to have
been waived unless such waiver is in writing and signed by Landlord. No payment
by Tenant or receipt and/or acceptance by Landlord of a lesser sum than the
agreed upon Rental shall operate or be deemed or construed to be other than on
account of the earliest Rental then unpaid, nor shall any endorsement or
statement on any check or any letter or writing accompanying any check nor the
acceptance of any check or payment be deemed an accord and satisfaction, and
Landlord may accept such check or payment without prejudice to its right to
recover the balance of any Rental or to pursue any other remedy to which it may
be entitled.

HOLDING OVER.

         37. Any holding over or continued occupancy by Tenant

                                      -26-
<PAGE>   28
                                                                    Exhibit 10.8

after the expiration of the Term of this lease shall not operate to extend or
renew this lease or to imply or create a new lease. In such event, Landlord
shall have the right to immediately terminate the Tenant's occupancy, or to
treat the Tenant's occupancy as a month-to-month tenancy, in which event Tenant
shall continue to pay the Rental charges and shall perform all obligations as
shall be in effect immediately prior to the termination of the Term hereof. In
no event however, shall Tenant be relieved of any liability to Landlord for
damages resulting from such holding over.

REFERENCE.

         38. Wherever herein the singular number is used, the same shall include
the plural, and the masculine gender shall include the feminine and neuter
genders, if applicable. The paragraph headings and captions used herein are for
reference and convenience only. The words "reenter" and "reentry" as used herein
are not restricted to their technical legal meaning.

ENTIRE AGREEMENT.

         39. This lease contains the entire agreement between the parties. No
oral statement or prior written matter shall have any force or effect nor shall
the waiver of any provision of this agreement be effective unless in writing,
signed by the waiving party. Tenant agrees that it is not relying on any
representations or agreements other than those contained in this lease. This
agreement shall not be modified except by a writing executed by both parties,
nor may this lease be cancelled by Tenant except with the written consent of
Landlord, unless otherwise specifically provided herein. The covenants,
provisions, terms conditions and agreements contained in this lease shall bind
the Landlord and Tenant and their respective successors and assigns and shall
inure to the benefit of the Landlord, the Tenant, their respective successors,
the assigns of Landlord and the assigns of Tenant who shall have obtained an
assignment of lease in accordance with the provisions of this lease.

ATTORNMENT.

         40. At the option of the Landlord, a purchaser of the Building, or the
holder of any mortgage or ground lease affecting

                                      -27-
<PAGE>   29
                                                                    Exhibit 10.8

the Premises, Tenant agrees that neither the cancellation nor the termination of
any ground or underlying lease to which this lease is now or may become subject
or subordinate, nor the sale of the Building, nor the foreclosure of any
mortgage affecting the Premises, nor the institution of any suit, action,
summary or other proceeding by Landlord or any mortgagee shall, by operation of
law or otherwise, result in the cancellation or termination of this lease or the
obligations of Tenant hereunder, and Tenant covenants and agrees in such event
to attorn to Landlord or to the holder of such mortgage or ground or underlying
lease or to the purchaser of the Building, whether by foreclosure or otherwise.

REAL ESTATE BROKER.

         41. Landlord and Tenant each represent to the other that it has dealt
with no real estate broker in connection with this lease unless so stated in the
Preamble. Each of Tenant and Landlord agree that if any claims should be made
for commissions by any other broker by reason of any acts of Tenant or Landlord
or its respective representatives, Tenant or Landlord, as the case may be, will
indemnify and save harmless the other from any and all claims, demands! losses,
liabilities, judgments, costs, expenses, attorneys' fees or other damages
resulting from, arising out of, or in connection with that parties acts.
Landlord agrees to pay brokerage commission due in connection with this lease,
if any, to the broker named in the Preamble in accordance with the terms and
conditions of a separate agreement entered into or to be entered into between
the Landlord and said broker.

VALIDITY OF LEASE.

         42. The terms, conditions, covenants and provisions of this lease shall
be deemed to be severable. If any clause or provision herein contained shall be
adjudged to be invalid or unenforceable by a court of competent jurisdiction or
by operation of any applicable law, the same shall be deemed to be severable and
shall not affect the validity of any other clause or provision herein, but such
other clauses or provisions shall remain in full force and effect, unless such
provisions shall relate to any payment of Rental hereunder. In such event,
Landlord, on not less than thirty (30) days written notice to Tenant, shall have
the right to terminate this lease on the date specified in such notice,
whereupon all Rental charges shall be apportioned as of the date of termination
and with the same force and effect as if the lease terminated on the maturity
date set forth herein.

COMMON AREAS.

         43. Not used in this Lease.

REPRESENTATIONS.

         44. Tenant represents that it is a corporation in good standing of the
State of New Jersey, that there are no judgments or suits pending against it,
and that it does not owe any taxes, that         and         are its President
and Secretary respectively, and that they are empowered and authorized to enter
into this lease for and on behalf of the corporation. Tenant agrees to deliver
to Landlord simultaneously with the execution hereof, a certified copy of a
resolution of its Board of Directors authorizing the execution of this lease.

ECRA AND ENVIRONMENTAL LAWS.

         45. (a) the parties hereto recognize that the occupancy and use of the
Premises by the Tenant may be governed by the provisions of the New Jersey
Environmental Cleanup Responsibility Act, N.J.S.A 13:1K-6 et seq. and the
regulations promulgated thereunder (ECRA). As such, subject to Landlord's
obligations

                                      -28-
<PAGE>   30
                                                                    Exhibit 10.8

hereunder, the Tenant hereby covenants that prior to any "closing, terminating
or transferring of Tenant's operations" (as said terms are defined by ECRA) at
the demised Premises, the Tenant shall, at Tenant's own expense, receive from
the Bureau of Industrial Site Evaluation (the "Bureau")of the New Jersey
Department of Environmental Protection and Energy (N.J.D.E.P.E) either:

                         (i) a non-applicability letter;

                        (ii) approval of a negative declaration; or

                       (iii) a non-qualified approval of Tenant's cleanup plan.

         The Tenant shall promptly apply for ECRA approval at least six (6)
months prior to the occurrence of any event that would trigger ECRA
responsibility on the part of the Tenant as herein provided. Landlord shall
cooperate with Tenant in furnishing such information as may be required by
NJDEPE or which is otherwise reasonably required by Tenant in connection with
said approvals.

                  (b) Tenant shall promptly furnish to Landlord true and
complete copies of all documents, submissions and correspondence provided by
Tenant to the Bureau and all documents, reports, directives and correspondence
provided by the Bureau to Tenant. Tenant shall also promptly furnish to Landlord
true and complete copies of all sampling and test results obtained from samples
and tests taken at and around the Premises if any.

                  (c) Tenant shall, at Tenant's own expense, comply with ECRA
and all orders and directives of the Bureau and shall implement and complete all
required cleanups to the satisfaction of the bureau resulting from Tenant's use
and occupancy of the Premises during the term of this Lease.

                  (d) Should the submission of a cleanup plan be required
pursuant to ECRA by reason of a violation of either ECRA or any other
Environmental Law (as hereinafter defined) by the Tenant, its agents, servants,
employees, contractors or invitees, Tenant shall satisfy the minimum financial
security requirements under ECRA, furnish to NJDEPE security satisfactory to
NJDEPE, in the form of a bond or letter of credit issued by a financial surety
authorized to do business in the State of New Jersey, guaranteeing the
performance and completion of Tenant's obligations pursuant to ECRA. The
security furnished by Tenant shall be renewed and kept in force by Tenant, at
Tenant's own expense, until such time as Tenant shall have received final
approval of the cleanup and a release of the financial sureties from NJDEPE.

                  (e) In the event Tenant is unable to obtain either (a) a
non-applicability letter, (b) an approval of a negative declaration or (c) an
approval of a cleanup plan, then Tenant shall, at Tenant's own expense, do
everything necessary in order to obtain an administrative consent order from the
New Jersey Department of Environmental Protection and Energy ("NJDEPE"),
obligating Tenant to comply, at Tenant's own expense, with all requirements of
ECRA, the Bureau and any other division of NDEPE.

                  (f) If ECRA compliance becomes necessary at the Premises due
to any action on the part of Landlord, including, but not limited to, Landlord's
execution of a sale agreement for the Premises, any change in ownership of the
Premises, initiation of bankruptcy proceedings, Landlord's financial
reorganization or sale of the controlling share of the Landlord's assets, the
Landlord shall comply with ECRA t Landlord's own expense, provided however, that
Tenant shall cooperate with Landlord by preparing and filing all documents and
furnishing such information as may be required by NJDEPE or which is otherwise
reasonably required by Landlord in connection with such sale, financing or
transfer of interest.

                  (g)Landlord represents and warrants to Tenant that, to the
best of its knowledge and belief, the Leased Premises are in full compliance
with all Environmental Laws and that there

                                      -29-
<PAGE>   31
                                                                    Exhibit 10.8

is no hazardous substance or waste at the Leased Premises Landlord has received
no notice of any violation of Environmental Laws.

                  (h) The Tenant agrees that it shall not do or omit to do nor
suffer the commission or omission of any act, the commission or omission of
which is prohibited by or may result in liability under any Environmental Law,
including, without limitation, the discharge of petroleum products or other
Hazardous Substances or Wastes (as hereinafter defined). If Tenant or its
agents, servants, employees, contractors or invitees, violates, during Tenants
occupancy, any Environmental Law, Tenant shall, at its sole cost and expense,
undertake any and all remedial measures required and otherwise comply with all
Environmental Laws.

                  (i) If there is any violation of Environmental Laws which
exists on the Possession Date or any violation of Environmental Laws which
occurs thereafter by anyone or any entity other than the Tenant, its agents,
servants, employees, contractors, or invitees, Landlord, at its sole cost and
expense, shall undertake any and all remedial measures required and otherwise
comply with all Environmental Laws.

                  (j) The term "Environmental Laws" as used herein means all
present and future federal, state or local laws, ordinances, rules, regulations,
opinions, orders, directives and policies as the same, from time to time, may be
amended, which relate to the environment, health or worker safety, including,
but not limited to ECRA;the Resource Conservation Recovery Act, 42 U.S.C.
Section 6901 et seq.; the Comprehensive Environmental Response Compensation and
Liability Act, 42 U.S.C. Section 9601 et seq; the Clean Water Act, 33 U.S. C.
Section 1241 et seq. ; the Spill Act; the New Jersey Water Pollution Control
Act, N.J.S.A. 58:10A-1 et seq.; the Water and Community Right to Know Act,
N.J.S.A. 34:5A-1 et seq.; The Spill Compensation and Control Act, N.J.S.A.
58:10-23.11 et seq., and the Occupational Safety and Health Act of 1979, 29
U.S.C. Section 651 et seq. The term "Hazardous Substances or Waste s" as used
herein means any material, waste or other substance, whether solid, liquid or
gaseous, which is defined as a hazardous substance, hazardous waste, toxic
substance or toxic waste in any Environmental Laws.

                  (k) The Tenant shall indemnify, defend and hold the Landlord
harmless from any and all losses of whatever nature including but not limited
to, lost rentals, claims, fines, filing fees, costs, and reasonable counsel,
engineering and other professional or expert fees, that Landlord may sustain as
a result of the Tenant's failure to comply in a timely fashion with the
provisions of this Paragraph 45.

                  (1) The Landlord shall indemnify, defend and hold the Tenant
harmless from any and all losses of whatever nature including, but not limited
to, lost rentals, claims, costs, and reasonable counsel, engineering and other
professional or expert fees, that Tenant may sustain as a result of the
Landlord's failure to comply in a timely fashion with the provisions of this
Paragraph 45.

                  (m) This paragraph shall survive the expiration or earlier
termination of this lease.

OPTION TO RENEW.

         46. The Tenant shall have two (2) five (5) year options to renew this
Lease, by giving the Landlord written notice of its intent to exercise its
option to renew this Lease for the five (5) year term no later than six (6)
months prior to the expiration of the previous term. However, this option shall
be available to Tenant if and only if the Tenant is not in breach of any
material condition or term of this Lease after notice and expiration of the

                                      -30-
<PAGE>   32
                                                                    Exhibit 10.8

applicable period to cure such breach. The terms and conditions of the Lease
shall remain the same except for the payment of Base Rent which shall change
according to the following formula for the renewal period:

                  (a) Ninety (90) days prior to the expiration of the original
term, Landlord and Tenant shall commence negotiations to determine the fair
market value of the leased premises for the renewal term of the lease (the
"FMV"). The FMV shall incorporate any rent concessions which may prevail in the
market at that time. If the parties have not agreed upon the FMV within thirty
(30) days, Landlord and Tenant shall each appoint a real estate appraiser within
thirty (30) days of the end of the first 30-day period to determine the FMV.
Each appraiser shall be a designated MAI appraiser. If either party fails to
timely appoint its appraiser, the appraisal of the more timely appointed
appraiser shall determine the FMV.

                  (b) As soon as practical after appointment, but within thirty
(30) days, each appraiser shall submit an appraisal of the FMV to Landlord and
Tenant. Each shall deliver a copy of the appraisal to the other within three (3)
days of receipt, with a copy to the other appraiser. If the appraisals submitted
are within ten (10%) percent of each other, the average of the two appraisals
shall be the FMV. If the appraisals submitted are not within ten (10%) percent
of each other, within ten (10) days after the submission of the original
appraisals, both appraisers shall jointly select a third appraiser qualified as
stated above, whose appraisal shall be restricted to a determination of the FMV
in an amount neither greater than the higher of the two other appraisals, nor
less than the lower of the two other appraisals. If the two appraisers do not
timely select the third appraiser, Tenant and/or Landlord may seek an order of
the court of competent jurisdiction for the appointment of a third appraiser.
The third appraiser's appraisal shall be averaged with the results of the other
two appraisals and such average shall be the FMV. The FMV so determined shall be
converted to an Annual Base Rent by multiplying the FMV by 95%. The new Annual
Base Rent shall be paid in twelve (12) installments on the first day of each
month commencing on the first day of the first month of the renewal term. If the
foregoing appraisal procedure shall not result in a determination of the FMV
within 90 days after the end of the first 30-day period referred to above,
either party may seek a determination by a court of jurisdiction as to the FMV.

(c) Landlord, at its sole cost and expense, will repaint and recarpet the
Premises (color to be selected by Tenant and quality to be comparable to the
original installation) upon the commencement of the first renewal term.

CANCELLATION OPTION.

         47. Tenant shall have the option to cancel this Lease at the end of the
sixtieth (60th) month by giving written notice to Landlord prior to the fifty
fifth (55th) month of the Lease and by payment of a cancellation penalty to the
Landlord in the amount of One Million One Hundred Forty One Thousand
($1,141,000) Dollars prior to the sixtieth (60th) month of the Lease.

EXPANSION.

         48. If during the term of this Lease Tenant requires additional space
and notifies Landlord in writing of its requirements, Landlord shall respond to
Tenant's request within twenty (20) days with a proposal for leasing such space
which includes a build-out allowance and terms and conditions. If Tenant and
Landlord enter into an expansion agreement which would provide for additional
space to be constructed for Tenant, it shall be conditioned upon Landlord's
ability to expand the building. Landlord shall proceed diligently to obtain the
necessary approvals for the expansion in accordance with the terms of the
aforesaid

                                      -31-
<PAGE>   33
                                                                    Exhibit 10.8

expansion agreement. If Landlord is unable to obtain the necessary approvals for
the expansion within six (6) months of the expansion agreement, then either
party may elect to terminate the expansion agreement.

ENVIRONMENTAL SURVEY.

         49. Tenant shall arrange for an environmental investigation of the
Leased Premises. Upon Tenant's receipt of the results of said investigation,
Tenant shall send Landlord a copy of the report. Notwithstanding anything
contained herein to the contrary, Tenant, at its option, may terminate this
Lease upon written notice to Landlord sent on or before January 27, 1993, in the
event that Tenant, in its sole discretion, is not satisfied with the results of
the environmental report. Termination shall be deemed effective as of the date
of said notice as if said date were the original termination date set forth in
this Lease. Landlord shall immediately return any monies paid to, or deposited
with Landlord, to Tenant. If Tenant has commenced work at the premises, Tenant
shall have the same rights to remove its improvements, fixtures and equipment
and the same obligations to restore the premises as it would otherwise have upon
the termination or expiration of the Lease.

NON-BINDING NATURE OF SUBMITTAL.

         50. It is understood by the Tenant that the submission of this Lease to
the Tenant for execution in no way binds the Landlord to any of the terms or
contents therein unless or until this Lease has been executed by a duly
authorized Partner of the Landlord.

         IN WITNESS WHEREOF, the parties hereto have hereunto set their hands
and seals or caused these presents to be signed and sealed by their proper
corporate officers the day and year first above written.

         ATTEST:                    DATE:      RAMSEY ASSOCIATES

                                    1/11/93    By: /s/ Michael E. Laino
         ----------------------     -------       --------------------------
                                                   Michael E. Laino
                                                   A General Partner

         ATTEST:                    DATE:      ALTEON, INC.

         /s/ Elizabeth O'Dell       1/8/93     By: /s/ Kenneth Ludlum
         -----------------------    ------        ------------------------
                                                   V.P. Finance

                                      -32-
<PAGE>   34
                                                                    Exhibit 10.8

                                   ALTEON INC.
                   165 LUDLOW AVE./NORTHVALE, NEW JERSEY 07647
                          201/784-1010 Fax:201/784-1344

                                    EXHIBIT C

November 5, 1992

Mr. Michael Laino
RAMSEY ASSOCIATES
500 Route 17 South
Hasbrouck Heights, New Jersey 07604

RE:      170 WILLIAMS DRIVE
         RAMSEY, NEW JERSEY

Dear Mike:

This letter will serve to confirm the intent of Alteon Inc. to enter into a
lease at 170 Williams Drive, under the following terms and conditions.

BUILDING:                  170 Williams Drive
                           Ramsey, New Jersey

OCCUPANCY:                 November 1, 1993

SPACE REQUIREMENT:         37,000 square feet, subject to the confirmation of
                           measurement by Alteon's architect. Measurement shall
                           be to the outside wall.

INITIAL TERM:              Ten (10) years.

<TABLE>
<CAPTION>
RENTAL RATE:               Months       Base Rent
                           ------       ---------
<S>                        <C>          <C>
                           1-18         $24,736.11 per month
                                        ($8.02 p.s.f./annum)
                           19-30        $28,906.25 per month
                                        ($9.38 p.s.f./ annum)
                           31-120       $44,708.33 per month
                                        (14.50 p.s.f./annum)
</TABLE>

SECURITY DEPOSIT:          Alteon will post either a letter of credit, Security
                           deposit, escrow account or other form of security in
                           a form acceptable to the lending institution
                           financing the improvements in this transaction, in
                           the amount of $1,034,000.

                           Alteon shall have the right, at its option, to reduce
                           the amount of the security by $103,400 at the end of
                           each year of the lease term.

                                      -33-
<PAGE>   35
                                                                    Exhibit 10.8

                                   ALTEON INC.
                   165 LUDLOW AVE./NORTHVALE, NEW JERSEY 07647
                          201/784-1010 Fax:201/784-1344

Mr. Michael Laino
November 5, 1992
Page Two

OPERATING EXPENSES:        Alteon will have the right to operate the building At
                           its own expense, or to have the landlord operate the
                           building. In the event the landlord operates the
                           building, landlord will cap the annual increase on
                           all operating expenses (excluding non-controllable
                           items such as real estate taxes and utilities ) at
                           5%. If the Landlord operates the building, Alteon
                           will pay a management fee of 3% of the annual net
                           rent to the Landlord.

TENANT CONSTRUCTION:       The landlord will contribute $978,500 to Alteon as a
                           cash allowance toward the construction of its tenant
                           space. Any unused portion of this allowance can be
                           converted to cash by Alteon.

                           Alteon shall have the right to competitively bid this
                           project to general contractors and subcontractors for
                           completion of the initial improvements and future
                           alterations over the Initial term of the lease, as
                           long as said contractors and subcontractors are
                           acceptable to the landlord, such acceptance not to be
                           unreasonably withheld. Landlord is encouraged to bid
                           the project. In the event an outside contractor is
                           selected, Landlord's supervisory fee shall be limited
                           to actual and reasonable cost for personnel time and
                           materials.

STRUCTURAL REPAIRS/
IMPROVEMENTS:              Landlord shall be responsible for water tightness and
                           structural repairs to the building not occasioned by
                           the tenant's misuse or failure to properly maintain
                           the premises during the term.

SPACE PLANNING/DESIGN:     Alteon is to receive from the Landlord $1.50 per
                           rentable square foot for space planning and working
                           drawings for the Initial Tanant Improvements.

RENEWAL OPTIONS:           a.       Alteon will receive two (2) five (5) year
                                    renewal options.

                           b.       Option Rental Rate after year ten and year
                                    15 shall be at 95% of the then Fair Market
                                    Value including rent concessions.

                                      -34-
<PAGE>   36
                                                                    Exhibit 10.8

                                   ALTEON INC.
                   165 LUDLOW AVE./NORTHVALE, NEW JERSEY 07647
                          201/784-1010 Fax:201/784-1344

Mr. Michael Laino
November 5, 1992
Page Three

                           c.       Landlord shall provide Alteon an allowance
                                    to repaint and carpet the premises upon the
                                    expiration of the ten (10) year occupancy.

                           d.       Notice for said renewal option is to be
                                    provided by Alteon six (6) months prior to
                                    the expiration of the existing lease. All
                                    other terms and conditions shall remain as
                                    negotiated in the primary lease document.

SIGNAGE:                   Alteon shall have all signage rights which are
                           permitted by existing zoning.

NON-PERFORMANCE BY
LANDLORD:                  If Alteon is unable to occupy the leased premises on
                           the planned occupancy date due to non-performance by
                           Landlord, lease commencement shall be postponed by
                           one day for each day of delay caused by Landlord's
                           non-performance. Any real estate costs Incurred by
                           Alteon due to landlord's non-performance shall be
                           paid by landlord.

SUBLEASE AND ASSIGNMENT:   Alteon will have the right to sublease all or a
                           portion of its space with owner's prior written
                           consent which shall not be unreasonably withheld or
                           delayed. Alteon will have the right to sublease to
                           affiliates or subsidiaries without Landlord's
                           consent. The rights provided to Alteon shall be
                           assignable to any assignee or subtenant. Tenant and
                           Landlord shall divide Equally all profits which may
                           arise out of an assignment or sublet after first
                           deducting all expenses incurred by tenant. The
                           Landlord will not have the right of recapture.

HOLD OVER RENT:            The holdover provision in the lease will state that
                           the hold over rent will be paid at 100% of the then
                           current base rental rate. All other standard
                           provisions shall remain intact.

NON-DISTURBANCE AGREEMENT: A non-disturbance agreement will be provided by the
                           mortgage holder(s) who will be re-financing the
                           building. Alteon will execute a tenant estoppel
                           agreement if requested. The mortgage holder(s) will
                           recognize the tenant and will assume the obligations
                           of the landlord.

                                      -35-
<PAGE>   37
                                                                    Exhibit 10.8

                                   ALTEON INC.
                   165 LUDLOW AVE./NORTHVALE, NEW JERSEY 07647
                          201/784-1010 Fax:201/784-1344

Mr. Michael Laino
November 5, 1992
Page Four

TENANT ELECTRIC:           Electric charges will be paid directly by Alteon to
                           the utility.

CANCELLATION OPTION:       Alteon shall have the option to cancel this lease at
                           the end of the fifth year by giving six (6) months
                           notice to the landlord and paying a cancellation
                           penalty of $1,141,000.

BUILDING FINANCING:        Landlord shall have 30 days from the conclusion of a
                           signed letter of intent to secure a commitment for
                           financing, after which time Alteon, at its option,
                           may elect not to proceed with the transaction.

BASE BUILDING WORK:        Landlord at its own expense, will complete the
                           Following base building work prior to Alteon's
                           Occupancy:

                           a)       install one hydraulic passenger / freight
                                    Elevator

                           b)       install mutually agreeable windows onto the
                                    portion of the lower level which is above
                                    grade

                           c)       screen the items on the roof from view at
                                    The front approach to the building, in a
                                    manner aesthetically consistent with the
                                    Building exterior.

                           d)       Prior to the start of tenant construction,
                                    landlord warrants water leakage problem in
                                    1st floor has been fixed or that landlord
                                    will take steps, to be approved by tenant,
                                    to assure building will be free from water
                                    infiltration in the future.

RESTORATION:               Alteon will not be required to restore the premises
                           to building standard construction or to remove any
                           above-standard improvements that were approved by the
                           Landlord and were completed during initial
                           construction or during the lease term. However,
                           Alteon retains right to remove laboratory fixtures
                           and any other above standard improvements, in which
                           case Alteon will repair any damage created by the
                           removal of fixtures and will leave the space in a
                           condition suitable for painting and carpeting.

                                      -36-
<PAGE>   38
                                                                    Exhibit 10.8

                                   ALTEON INC.
                   165 LUDLOW AVE./NORTHVALE, NEW JERSEY 07647
                          201/784-1010 Fax:201/784-1344

Mr. Michael Laino
November 5, 1992
Page Five

EXPANSION:                 If expansion space is required, Alteon shall have the
                           right to request Landlord to seek site plan approval
                           for expansion of the building. Landlord shall have
                           six (6) months to achieve approvals within the
                           parameters previously established between landlord
                           and tenant.

USE:                       Tenant is a pharmaceutical development company, with
                           certain special needs pursuant to the laboratory
                           space it plans to build out:

                           [ ]    Seven day a week access
                           [ ]    100% fresh air/ducted exhaust for labs
                           [ ]    Acid neutralization tanks at lab drains
                           [ ]    Chemical waste pick-up by contractor
                           [ ]    Radioisotope usage - licensed by NRC
                           [ ]    Radioisotope disposal and pick-up by licensed
                                  contractor
                           [ ]    A standard pharmaceutical animal testing
                                  facility.

BROKERAGE:                 Landlord shall be responsible for any payment due the
                           Edward S. Gordon Company of New Jersey Inc.,
                           ("Broker") as the broker in the transaction, subject
                           to a separate agreement between Landlord and Broker.

This letter of intent is subject to the execution of a mutually satisfactory
lease document, and is subject to the approval of Alteon's Board of Directors.

Sincerely,

/s/ Kenneth Ludlum                            Agreed and Accepted:
------------------                            By: Ramsey Associates
Kenneth Ludlum                                /s/ Michael Laino
Vice President - Finance                      -----------------
                                              Michael Laino - General Partner

cc: David Sherman
    Andrew Kaplan

                                      -37-
<PAGE>   39
                                                                    Exhibit 10.8

EXHIBIT D                                Prepared by:___________________________

                                         Name:_______________________________

Date:________________________________

MORTGAGEE:        FIRST FIDELITY BANK, NATIONAL ASSOCIATION, NEW JERSEY
                  570 Broad Street, Newark, New Jersey 07102
                  Commercial Real Estate Department
                  Attention:____________________________________________________

                  ______________________________________________________________

MORTGAGOR:        Name:_________________________________________________________

LESSEE:           Name:_________________________________________________________

                  Mailing Address:______________________________________________

                  ______________________________________________________________

                  ______________________________________________________________

MORTGAGED         Street Address:_______________________________________________

PREMISES:         Municipality of:______________________________________________

                  County of ______________________________, State of  New Jersey

                  Tax Map Designation: Lot No. ____________ Block No. __________

                  Deed Reference: Date of Deed _________________________________

                  Recorded - Deed Book No. _______________ Page No. ____________
DATE OF
LEASE:            ______________________________________________________________

The Mortgagee and Lessee hereby agree as follows:

1.       STATEMENT OF FACTS.

         1.1      The Lessee has entered into the Lease covering all or a
portion of the Mortgaged Premises.

         1.2      As security for a loan made by the Mortgagee to the Mortgagor,
the Mortgagor has given to the Mortgagee a mortgage dated
__________________________ on the Mortgaged Premises (the "Mortgage").

         1.3      As a condition of making the loan, the Mortgagee has required
that the Lease be subordinated to the loan and terms of the Mortgage and in
exchange for such, the Lessee has requested and the Mortgagee has agreed not to
disturb Lessee's possessory rights in the Mortgaged Premises provided that the
Lessee is not in default under the Lease and that the Lessee attorns to the
Mortgagee or purchaser at the foreclosure sale.

2.       SUBORDINATION OF LEASE.

         The Lease is and shall be subject and subordinate to the Mortgage and
to all renewals, modifications, consolidations, replacements and extensions
thereof, to the full extent of the principal amount and other sums secured
thereby and interest thereon, as though the Mortgage had been executed,
acknowledged, delivered, recorded and properly indexed prior to the execution
and delivery of the Lease.

3.       ATTORNMENT

         3.1      The Lessee agrees that it will attorn to and recognize (i) any
purchaser at a foreclosure sale under the Mortgage; (ii) any transferee who
acquires possession or title to the Mortgaged Premises by deed in lieu of
foreclosure or other means; and (iii) the successors and assignee of such
purchase and/or transferees, as its landlord for the unexpired balance (and any
extensions, if exercised) of the term of the Lease upon the same terms and
conditions set forth in the Lease. Such attornment shall automatically become
effective, without the need for execution of any further instrument by any of
the parties hereto; provided, however, that Lessee will upon request by the
Mortgagee, or any subsequent owner, execute a written agreement whereunder the
Lessee will attorn to the Mortgagee or any subsequent owner, affirm Lessee's
obligations under the Lease and agree to pay all rentals and charges that are or
to become due as they become due to the Mortgagee or such subsequent owner.

         3.2      In the event that the Mortgagee shall succeed to the interest
of the Mortgagor under the Lease, and/or to title to the Mortgaged Premises, the
Mortgagee and the Lessee hereby agree to be bound to one another under all of
the terms, covenants and conditions of the Lease; provided, however, that the
Mortgagee (or any other party acquiring the Mortgaged Premises upon a
foreclosure sale or from the Mortgagee) shall not be (i) liable for any act or
omission at any prior landlord (including the Mortgagor); (ii) liable for the
return of any security deposit to the extent not paid over to the Mortgagee;
(iii) subject to any offsets or defenses which the Lessee might have against any
prior Landlord (including the Mortgagee) (iv) bound by any rent or additional
rent which the Lessee might have paid for more that the current month to any
prior landlord (including the Mortgagor) to the extent not paid over to the
Mortgagee; or (v) bound by any amendment or modification of the Lease made
without its prior express written consent.

         3.3      The Lessee agrees, until any such attornment, not to pay rent
or additional rent under the Lease for more than one month in advance without
the prior express written consent of the Mortgagee.

         3.4      The Lessee shall have no right to appear in any foreclosure
action under the Mortgage.

4.       ACCEPTANCE OF COLLATERAL ASSIGNMENT OF LEASES.

         The Lessee acknowledges notice of and consents to that certain
Assignment of Leases from the Mortgagor to the Mortgagee, dated ______________,
19______. (the "Assignment"). The Lessee agrees with the Mortgagee and the
Mortgagor that, in the event the Mortgagee becomes a mortgagee-in-possession of
the Mortgaged Premises, or otherwise takes title to the Mortgaged Premises, upon
demand or notice as provided in the Assignment, the Lessee shall make payment of
all monies due under the Lease directly to the Mortgagee. Any such payment shall
be made notwithstanding any

                                      -38-
<PAGE>   40
                                                                    Exhibit 10.8

5.       NONDISTURBANCE.

         5.1      Provided the Lessee complies with the Agreement and is not in
default under the Lease in or otherwise commence foreclosure proceedings, the
Mortgagee will not disturb Lessee's possession under the Lease and the Lease
will not be affected or cut off by such proceedings*

         5.2      The Lessee agrees that this Agreement satisfies any condition
or requirement in the Lease relating to the granting of a nondisturbance
agreement.

6.       RIGHT TO CURE DEFAULTS.

         6.1      The Lessee shall promptly notify the Mortgagee by registered
or certified mail, return requested, of the occurrence of any default or

         6.2      If the Mortgagor shall have failed to cure the event of
default within the time provided in the lease, then the Mortgagee shall have an
additional thirty (30) days within which to cure the event of default or if it
cannot be cured with the time such additional time as may be necessary to effect
the cure if within the thirty (30) days the Mortgagee has commenced and it is
diligently pursuing the remedies necessary to cure the event of default
(including, without limitation, the commencement of foreclosure proceedings, if
necessary to affect the cure), in which event the Lease shall not be terminated.

7.       ESTOPPEL CERTIFICATES AND NOTICES.

         7.1      The Lessee shall deliver to the Mortgagee within ten (10) days
of its request, from time to time, certificates as to the continuance of the
Lease in effect, payment of rents thereunder and related matters.

         7.2      The Lessee shall from the date hereof send to the Mortgagee a
copy of any notice or statement required to be sent under the Lease to the
Mortgagor, at the same time such notice is sent to the Mortgagor.

8.       MISCELLANEOUS.

         8.1      Primary Liability. The Lessee represents and warrants that it
is now the sole owner of the leasehold estate created by the Lease and that it
shall not hereafter assign the Lease, except as permitted by the terms thereof,
and that notwithstanding any such assignment or any sublease of the Mortgaged
Promise, the Lessee shall remain primarily liable for the observance and
performance of all of its obligations and agreement under the lease.

         8.2      Modifications. Neither the Lease nor this Agreement may be
amended without the prior express written consent of the Mortgagee.

         8.3      Binding Affect. This Agreement shall inure to the benefit of
the parties hereto, their successors and assigns; provided, however, that (i) in
the event of the assignment or transfer of the interest of the Mortgagee, all
obligations and liabilities of the Mortgagee under this Agreement shall
terminate, and thereupon all such obligations and liabilities shall be the
responsibility of the party to whom Mortgagee's interest is assigned or
transferred; and (ii) the interest of Lessee under this Agreement may not be
assigned or transferred. Nothing contained in this Agreement shall in any way
impair or affect the lien created by the Mortgage, except as specifically set
forth herein.

         8.4      Counterparts. This Agreement may be signed in any number of
counterparts with the same affect as if the signature thereto and hereto were on
the same instrument.

         8.5      Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New Jersey.

         IN WITNESS WHEREOF, this Assignment has been duly executed and
delivered by the parties on the day and year first above written:

<TABLE>
<S>                                   <C>
WITNESS:                              LESSEE:

-----------------------------         ------------------------------------------
                                      Name:           (Individual)

WITNESS:

-----------------------------         ------------------------------------------
                                      Name            (Individual)

                                      ------------------------------------------
                                              (Corporation or Partnership)
ATTEST:

                                      By:
-----------------------------            ---------------------------------------
                                         Name:
                                         Title:

ATTEST:

                                      By:
-----------------------------            ---------------------------------------
                                         Name:
                                         Title:

(CORPORATE SEAL)

                                      MORTGAGEE:

                                      FIRST FIDELITY BANK, NATIONAL ASSOCIATION
                                      NEW JERSEY

ATTEST:                               By:
                                         ---------------------------------------
                                         Name:
-----------------------------            Title:
(CORPORATE SEAL)
</TABLE>

Mortgagee agrees to immediately recognize and honor all of lessees rights under
the Lease and satisfy Landlord's obligations under the Lease, including use of
insurance proceeds, condemnation proceeds, and delivery of Tenant's Construction
Improvement Allowance.

                                      -39-

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