SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant X
---
Filed by a party other than the Registrant
---
CHECK THE APPROPRIATE BOX:
X Preliminary proxy statement Confidential, for use of the
- - - --- --- Commission only (as
Definitive proxy statement permitted by Rule 14a-6(e)(2))
- - - ---
Definitive additional materials
- - - ---
Soliciting material pursuant to
- - - --- Rule 14a-11(c) or Rule 14a-12
Ansan, Inc.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
X $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
- - - --- Item 22(a)(2) of Schedule 14A.
$500 per each party to the controversy pursuant to Exchange Act
- - - --- Rule 14a-6(i)(3).
Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
- - - ---
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:1*
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid
* Set forth the amount on which the filing fee is calculated and state how it
was determined.
Fee paid previously, with preliminary materials.
- - - ---
Check box if any part of the fee is offset as provided by Exchange Act
- - - --- Rule 0-11(a)(2) and identify the filing of which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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1
PRELIMINARY
ANSAN, INC.
400 Oyster Point Boulevard
Suite 435
South San Francisco, California 94080
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD OCTOBER 22, 1996
To the Shareholders of
Ansan, Inc.
Notice is hereby given that the Annual Meeting of Shareholders of
Ansan, Inc. will be held on October 22, 1996 at 10:00 a.m., local time, at the
offices of the Company, 400 Oyster Point Boulevard, Suite 435, South San
Francisco, California 94080. The meeting is called for the following purpose:
1. To elect a board of eight directors;
2. To consider and take action upon a proposal to approve an
amendment to the Company's Certificate of Incorporation to change
the name of the Company to Ansan Pharmaceuticals, Inc.;
3. To approve the appointment of Ernst & Young LLP as the
independent auditors of the Company; and
4. To consider and take action upon such other matters as may
properly come before the meeting or any adjournment or
adjournments thereof.
The close of business on August 30, 1996 has been fixed as the record
date for the determination of shareholders entitled to notice of, and to vote
at, the meeting. A list of the shareholders entitled to vote at the meeting may
be examined at the Company's offices during the ten-day period preceding the
meeting.
All shareholders are cordially invited to attend the meeting. Whether
or not you expect to attend, you are respectfully requested by the Board of
Directors to sign, date and return the enclosed proxy promptly. Shareholders who
execute proxies retain the right to revoke them at any time prior to the voting
thereof. A return envelope which requires no postage if mailed in the United
States is enclosed for your convenience.
By Order of the Board of Directors,
S. Mark Moran, M.D.
President and Chief Executive Officer
Dated: September 6, 1996
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ANSAN, INC.
400 Oyster Point Boulevard
Suite 435
South San Francisco, California 94080
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Ansan, Inc. (the "Company") for the
Annual Meeting of Shareholders to be held at the offices of the Company, 400
Oyster Point Boulevard, Suite 435, South San Francisco, California 94080 on
October 22, 1996, at 10:00 a.m., local time, and for any adjournment or
adjournments thereof, for the purposes set forth in the accompanying Notice of
Annual Meeting of Shareholders.
If the enclosed proxy is properly executed and returned, the shares
represented thereby will be voted in accordance with the directions thereon and
otherwise in accordance with the judgment of the persons designated as proxies.
Any proxy on which no direction is specified will be voted in favor of the
actions described in this Proxy Statement and for the election of the nominees
set forth under the caption "Election of Directors."
The approximate date on which this Proxy Statement and the accompanying
form of proxy will first be mailed or given to the Company's shareholders is
September 6, 1996.
Your vote is important. Accordingly, you are urged to sign and return
the accompanying proxy card whether or not you plan to attend the meeting. Any
shareholder giving such a proxy has the power to revoke it at any time before it
is voted. The casting of a ballot at the meeting by a shareholder who may
theretofore have given a proxy or the subsequent delivery of a proxy will have
the effect of revoking the initial proxy.
VOTING SECURITIES
Only holders of shares of common stock, $.001 par value per share
("Common Stock"), of record at the close of business on August 30, 1996 are
entitled to vote at the meeting. On the record date, the Company had outstanding
and entitled to vote [2,768,798] shares of Common Stock, each entitled to one
vote upon all matters to be acted upon at the meeting. A majority in interest of
the outstanding Common Stock represented at the meeting in person or by proxy
shall constitute a quorum. The affirmative vote of a plurality of the Common
Stock represented at the meeting is necessary to elect the nominees for election
as directors, the affirmative vote of a
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majority of the outstanding shares of Common Stock is necessary to amend the
Company's Certificate of Incorporation and the affirmative vote of a majority of
the Common Stock represented at the meeting is necessary to approve and ratify
the appointment of Ernst & Young LLP, independent certified public accountants
as the independent auditors of the Company. Abstentions and broker non-votes are
counted for purposes of determining the presence or absence of a quorum for the
transaction of business. If a shareholder, present in person or by proxy,
abstains on any matter, the shareholder's shares will not be voted on such
matter. Thus, an abstention from voting on any matter has the same legal effect
as a vote "against" the matter even though the shareholder may interpret such
action differently. Except for determining the presence or absence of a quorum
for the transaction of business, broker non-votes are not counted for any
purpose in determining whether a matter has been approved. A "broker non- vote"
refers to shares of Common Stock represented at the meeting in person or by
proxy by a broker or nominee which such broker or nominee (i) has not received
voting instruction on a particular matter from the beneficial owners or persons
entitled to vote and (ii) the broker or nominee does not have discretionary
voting power on such matter.
PRINCIPAL SHAREHOLDERS
The following table sets forth certain information as of August 30,
1996 regarding the ownership of Common Stock by (i) each person known by the
Company to own beneficially more than 5% of each class of outstanding Common
Stock, (ii) each director of the Company, (iii) the executive officer of the
Company named in the Summary Compensation Table and (iv) all executive officers
and directors of the Company as a group:
Name And Address Of Shares Benefi- Percent of Shares
Beneficial Owner (1) cially Owned Beneficially Owned
- - - -------------------- -------------- ------------------
Titan Pharmaceuticals, Inc. (2)(3).. 1,612,654 50.6%
Dr. Louis R. Bucalo(4)(5)(6)........ 1,627,706 50.8%
Dr. S. Mark Moran(4)(7)............. 74,422 2.6%
Dr. Lindsay A. Rosenwald(5)(9)(10).. 1,612,989 50.6%
Peter M. Kash(5)(9)(10)............. 1,629,361 51.1%
Richard Sperber(8)(11).............. 6,273 *
Dr. Alan R. Timms(8)(12)............ 1,250 *
Dr. Ilan Cohn(8)(13)................ 1,250 *
Dr. David Naveh(14)................. -- --
All executive officers and directors
as a group (eight persons)........ 1,727,943 52.8%
- - - ------------
* Less than 1%.
(1) Includes such individuals' or entity's escrowed shares. In computing
the number of shares beneficially owned by a person and the percentage
ownership of a person, shares of Common Stock of the Company, subject
to options (including escrowed options) held by that person that are
currently exercisable or exercisable within 60 days are deemed
outstanding. Such shares, however, are not deemed outstanding for
purposes of computing the percentage ownership of each other person.
Except as indicated in the
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footnotes to this table and pursuant to applicable community property
laws, the persons named in the table have sole voting and investment
power with respect to all shares of Common Stock.
(2) The address of such company is 400 Oyster Point Boulevard, Suite 505,
South San Francisco, California 94080.
(3) Includes 400,000 shares issuable on the exercise of outstanding options.
(4) The address of such individual is c/o Ansan, Inc., 400 Oyster Point
Boulevard, Suite 435, South San Francisco, California 94080.
(5) Includes 1,212,654 shares owned of record by Titan Pharmaceuticals,
Inc. ("Titan") and 400,000 shares issuable on the exercise of outstanding
options. Dr. Bucalo is President and Chief Executive Officer and a
member of Titan's Board of Directors and Dr. Rosenwald and Mr. Kash are
members of its Board of Directors. As a result, each of Drs. Rosenwald
and Bucalo and Mr. Kash may be deemed to share voting or investment
power with respect to such shares. Each of these individuals, however,
disclaims beneficial ownership with respect to such shares.
(6) Includes 15,052 shares issuable on the exercise of outstanding options.
(7) Includes 62,109 shares issuable on the exercise of outstanding options.
(8) Represents shares issuable on the exercise of outstanding options.
(9) Includes 335 shares issuable on the exercise of outstanding options.
(10) The address of such individual is c/o Paramount Capital Ltd., 375 Park
Avenue, New York, New York 10152.
(11) The address of such individual is c/o The Global Medicines Group, Inc.,
515 Seabreeze Boulevard, Suite 510, Fort Lauderdale, Florida 33316.
(12) The address of such individual is 1158 Pinewood Drive, Napa, California
94558.
(13) The address of such individual is c/o Dr. Reinhold Cohn & Partners,
P.O. Box 4060, Tel Aviv, Israel 61046.
(14) The address of such individual is 119 Monte Avenue, Piedmont, California
94611.
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ELECTION OF DIRECTORS
At the meeting, eight directors will be elected by the shareholders to
serve until the next Annual Meeting of Shareholders or until their successors
are elected and shall qualify. It is intended that the accompanying proxy will
be voted for the election, as directors, of the eight persons named below,
unless the proxy contains contrary instructions. The Company has no reason to
believe that any of the nominees will not be a candidate or will be unable to
serve. However, in the event that any of the nominees should become unable or
unwilling to serve as a director, the persons named in the proxy have advised
that they will vote for the election of such person or persons as shall be
designated by the Company's Management.
The following table sets forth the names, ages and positions of the
executive officers and directors of the Company.
Name Age Position
---- --- --------
Louis R. Bucalo, M.D.(1) 36 Chairman of the Board of Directors
S. Mark Moran, M.D. 48 President, Chief Executive Officer
and Director
Lindsay A. Rosenwald, M.D. 37 Director
Peter M. Kash (1)(2) 33 Director
Richard Sperber(1)(2) 54 Director
Alan R. Timms, Ph.D. 64 Director
Ilan Cohn, Ph.D. 41 Director
David Naveh, Ph.D. 44 Director
- - - ------------
(1) Member of Compensation Committee.
(2) Member of Audit Committee.
LOUIS R. BUCALO, M.D. is a co-founder of the Company and has served as
a director of the Company since its inception in November 1992. Dr. Bucalo has
served as Chairman of the Board since May 1994. He served as President of the
Company from November 1992 until December 1993. From July 1990 until April 1992,
Dr. Bucalo was Associate Director of Clinical Research at Genentech, Inc., a
biotechnology company. Dr. Bucalo also serves as President and Chief Executive
Officer of Titan, Chief Executive Officer of one of Titan's operating
subsidiaries and is Chairman of the Board of Directors of several additional
operating subsidiaries. Dr. Bucalo holds an M.D. from Stanford University and a
B.A. in biochemistry from Harvard University.
S. MARK MORAN, M.D. has served as the Company's President and Chief
Executive Officer and a director since April 1995. Prior to joining the Company,
Dr. Moran was employed by Glycomed, Inc., a biopharmaceutical company in
Alameda, California, serving as Vice President Operations from July 1994 to
April 1995, and Vice President Medical Affairs from October 1991 to June 1994.
Prior to joining Glycomed, Dr. Moran was employed for more than
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five years by G. D. Searle & Co. in positions of increasing responsibility.
Dr. Moran holds an M.D. from Washington University School of Medicine, an
M.B.A. from the Kellogg Graduate School of Management at Northwestern
University and a B.S. in Mathematics from the University of Oklahoma.
LINDSAY A. ROSENWALD, M.D. is a co-founder of the Company and has
served as a director of the Company since its inception in November 1992. Dr.
Rosenwald co-founded Interneuron Pharmaceutical, Inc. in October 1988 and has
served as its Chairman since February 1989. Dr. Rosenwald has been the Chairman
and President of The Castle Group, Ltd., a New York medical venture capital firm
("Castle"), since October 1991, and the Chairman and President of Paramount
Capital, Inc., an investment banking firm, since February 1992. Prior thereto,
Dr. Rosenwald was a Managing Director, Corporate Finance at D.H. Blair & Co.,
Inc. Dr. Rosenwald also is a director of BioCryst Pharmaceutical, Inc. and
Sparta Pharmaceutical, Inc., both of which are public companies, and is Chairman
of the Board or a director of a number of privately held companies founded by
Castle in the biotechnology or pharmaceutical fields.
PETER M. KASH is a co-founder of the Company and has served as a
director of the Company since its inception in November 1992. Mr. Kash has
served as a Managing Director of Paramount Capital, Inc. since August 1991. From
August 1988 until August 1991, he was employed with D.H. Blair & Co., Inc.
RICHARD SPERBER has been a director of the Company since May 1994. Mr.
Sperber has been President and Chief Executive Officer of The Global Medicines
Group Inc., a consulting firm, since 1991. In addition, Mr. Sperber provides
consulting services to Titan for a fee of $5,000 per month. Mr. Sperber served
as Director, Business Development and Strategic Planning and as a member of the
Board of Directors of Glaxo Pharmaceutical U.K., Ltd. from 1988 to 1991.
ALAN R. TIMMS, PH.D. has been a director of the Company since July
1995. From July 1994 until July 1995 Dr. Timms served as President of Timms
Biomedical Consultants and Senior Vice President of DHR International. Dr. Timms
served as Chairman of the Board, President and Chief Executive Officer of
Glycomed, Inc. from July 1988 to July 1994.
ILAN COHN, PH.D. has been a director of the Company since October 1995.
Dr. Cohn is a principal in the law firm of Reinhold Cohn and Partners in Tel
Aviv, Israel.
DAVID NAVEH, PH.D. has been a director of the Company since May 1996.
Dr. Naveh has served as Director of Process Technology for Bayer Corporation
since September 1992. From 1988 to September 1992, Dr. Naveh served as Director
Biotechnology Operations of Centocor Inc., a biotechnology company which
manufactures antibodies.
Directors serve until the next annual meeting or until their successors are
elected and qualified. Officers serve at the discretion of the Board of
Directors, subject to rights, if any, under contracts of employment.
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BOARD COMMITTEES AND DESIGNATED DIRECTORS
The Board of Directors has a Compensation Committee which makes
recommendations to the Board concerning salaries and incentive compensation for
officers and employees of the Company and may administer the Company's stock
option plans. The Board of Directors also has an Audit Committee which reviews
the results and scope of the audit and other accounting related matters. The
Company does not have a Nominating Committee and has established no procedures
whereby nominees for directors may be recommended by shareholders.
The Company has agreed, if requested by D.H. Blair Investment Banking
Corp. ("Blair"), the underwriter of the company's initial public offering (the
"IPO") which was consummated in August and September of 1995, to nominate a
designee of Blair to the Company's Board of Directors for a period of five years
ending August 8, 2000. Dr. Naveh has been designated as a nominee at the request
of Blair.
DIRECTOR COMPENSATION
Non-employee directors receive $1,000 for each Board and committee
meeting attended and are reimbursed for their expenses in attending such
meetings. Directors are not precluded from serving the Company in any other
capacity and receiving compensation therefor. In addition, directors are
entitled to receive options ("Director Options") pursuant to the Company's 1995
Stock Option Plan. Director Options are exercisable in four equal annual
installments commencing six months from the date of grant and expire the earlier
of 10 years after the date of grant or 90 days after the termination of the
director's service on the Board of Directors. In August 1995, each of Mr.
Sperber and Dr. Timms received Director Options to purchase 5,000 shares of
Common Stock at an exercise price of $5.00 per share. Dr. Cohn received 5,000
Director Options exercisable at $4.625 per share when he joined the Board in
October 1995 and Dr. Naveh received 5,000 Director Options exercisable at $4.203
per share when he joined the Board in May 1995.
The Board of Directors met four times during 1995 and also took action
by unanimous written consent. Each of the current directors of the Company,
other than Dr. Rosenwald, attended at least 75% of the meetings of the Board of
Directors which were held during the time such person served. The Compensation
Committee and the Audit Committee did not meet during 1995.
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EXECUTIVE COMPENSATION
The following Summary Compensation Table sets forth the compensation
earned by S. Mark Moran, the Company's Chief Executive Officer, for the fiscal
year ended December 31, 1995 (the "Named Officer").
SUMMARY COMPENSATION TABLE
Annual Long-Term
Compensation Awards
------------ ------
Name and Present
Principal Position Year Salary Bonus Options
- - - ------------------ ---- ------ ----- -------
S. Mark Moran, President and
Chief Executive Officer....... 1995 $138,750 $120,000 62,846
On July 29, 1996, the Compensation Committee agreed to grant Dr. Moran
a cash bonus of $27,750, payment of which will be deferred (with interest at the
rate of prime plus 1%) until the achievement of certain performance objectives.
OPTION GRANTS IN LAST FISCAL YEAR
The following table contains information concerning the stock option
grants made to the Named Officer for the fiscal year ended December 31, 1995. No
stock appreciation rights were granted to this individual during such year.
Individual Grant
----------------------------------
Number Of
Securities
Underlying % Of Total Exercise
Options Options Granted Or Base
Expiration Granted To Employees In Price
Name Date (#)(1) Fiscal Year ($/Sh)(2)
- - - ---- ---- ------ ----------- ---------
S. Mark Moran............. 4/2005 62,846 88.6% $.58
- - - ------------
(1) Each of the options listed in the table is immediately exercisable. The
shares purchasable thereunder are subject to repurchase by the Company
at the original exercise price paid per share upon the optionee's
cessation of service to the Company. Such repurchase right lapsed with
respect to 5,237 shares upon completion of the IPO and will lapse with
respect to 1/48th of the remaining shares at the commencement of each
of the first 48 months following the IPO.
(2) The exercise price may be paid in cash, in shares of Common Stock
valued at the fair market value on the exercise date or through a
cashless exercise procedure involving a same-day sale of the purchased
shares. The Company may also finance the option exercise by lending
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the optionee sufficient funds to pay the exercise price for the
purchased shares, together with any federal and state income tax
liability incurred by the optionee in connection with such exercise.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES
The following table sets forth information concerning option exercises
and option holdings for the fiscal year ended December 31, 1995 with respect to
the Named Officer. No stock appreciation rights were exercised during such year
or were outstanding at the end of that year.
Number Of Securities Value Of
Underlying Unexercised Unexercised In-the-money
Options At FY-end (#) Options At Fy-end(1)
Shares ---------------------- ------------------------
Acquired
Name On Exercise(#) Exercisable(2) Unexercisable Exercisable Unexercisable
- - - ---- -------------- -------------- ------------- ----------- -------------
S. Mark Moran.... -- 62,846 -- $136,376 --
- - - --------------
(1) Based on the fair market value of the Company's Common Stock at
year-end, $2.75 per share (as determined by the Company's Board of
Directors), less the exercise price payable for such shares.
(2) On June 7, 1996, Dr. Moran exercised 12,313 of such options. Such
options are immediately exercisable for all the option shares, but any
shares purchased under the options will be subject to repurchase by the
Company at the original exercise price per share upon the optionee's
cessation of service to the Company. As of August 30, 1996, the
repurchase right has lapsed as to7,326 of the 50,533 shares currently
underlying unexercised options.
EMPLOYMENT AGREEMENTS
In April 1995, the Company entered into an employment agreement with
Dr. S. Mark Moran, the President and Chief Executive Officer of the Company (the
"Moran Employment Agreement"), pursuant to which the Company is obligated to pay
Dr. Moran (a) an initiation fee of $120,000 and (b) an annual base salary of
$185,000, subject to annual increases in accordance with Company policies, in
addition to an automatic cost of living adjustment based upon the consumer price
index. Dr. Moran is also entitled to receive an annual performance bonus as
determined by the Board of Directors of up to 20% of his base salary. In
addition, under the terms of the Moran Employment Agreement, the Company is
obligated to pay Dr. Moran a bonus equal to 5% of the net proceeds paid to the
Company by institutional investors and corporate partners he secures within the
first two years of his employment and 3% of the net proceeds paid to the Company
by such entities during the third year of his employment. Such payments are
subject to a limitation of 10% of the total net proceeds received by the Company
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for any such investment when combined with other fees payable to third parties
in connection with any such financing and certain other exceptions contained in
the agreement. The Company also issued to Dr. Moran, pursuant to the Moran
Employment Agreement, options to purchase an aggregate of 62,846 shares of the
Company's Common Stock, at an exercise price of $.58 per share. The shares that
may be acquired on the exercise of Dr. Moran's options are subject to repurchase
by the Company at the original exercise price paid per share upon Dr. Moran's
cessation of service to the Company. The repurchase right lapsed upon completion
of the IPO with respect to 5,237 shares. The repurchase right will lapse with
respect to the balance of the option shares in a series of equal monthly
installments over the optionee's completion of each month of service after the
date of the IPO, with each such installment equal to 1/48th of the option
shares. The Moran Agreement provides that in the event Dr. Moran's employment is
terminated without good cause (as defined), the Company will pay Dr. Moran
severance equal to six months' base salary if the termination occurs during the
first two years and 12 months' base salary for a termination thereafter, subject
in the latter case to offset by other salary received by Dr. Moran.
The Company agreed with Blair that notwithstanding the provisions of
the foregoing employment agreement, the compensation of the Company's executive
officers would not increase from current levels for a period of 13 months from
the closing of the IPO.
The Company has obtained "key-man" life insurance in the amount of
$2,000,000 on each of the lives of Drs. Moran and Bucalo.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Company's Board comprises Messrs.
Bucalo, Sperber and Kash. Neither Mr. Sperber nor Mr. Kash was at any time
during the fiscal year ended December 31, 1995 or at any other time, an officer
or employee of the Company. Mr. Sperber does not serve as a member of the board
of directors or compensation committee of any entity that has one or more
executive officers serving as a member of the Company's Board of Directors or
Compensation Committee. Mr. Kash is a member of the Board of Directors of Titan.
Dr. Bucalo, who serves as Chairman of the Board of Directors of the Company, is
also President, Chief Executive Officer and a member of the Board of Directors
of Titan.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's executive officers, directors and persons who
beneficially own more than 10% of a registered class of the Company's equity
securities to file with the Securities and Exchange Commission (the "SEC")
initial reports of ownership and reports of changes in ownership of common stock
and other equity securities of the Company. Such executive officers, directors,
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and greater than 10% beneficial owners are required by SEC regulation to furnish
the Company with copies of all Section 16(a) forms filed by such reporting
persons.
Based solely on the Company's review of such forms furnished to the
Company and written representations from certain reporting persons, the Company
believes that all filing requirements applicable to the Company's executive
officers, directors and greater than 10% beneficial owners were complied with.
CERTAIN TRANSACTIONS
Louis R. Bucalo, Chairman of the Company's Board of Directors, is also
President, Chief Executive Officer and a member of the Board of Directors of
Titan, the majority stockholder of the Company. Lindsay A. Rosenwald and Peter
M. Kash, directors of the Company, are also members of the Board of Directors of
Titan.
In 1992, Titan purchased 327,446 shares of Common Stock of the Company
for nominal consideration. In May 1994, Titan purchased 532,651 shares of the
Company's Series A Preferred Stock for $992,592 in cash and the forgiveness of a
payable in the amount of $1,449,064, which shares were converted into 532,651
shares of Common Stock upon completion of the IPO. In connection with Titan's
purchase of the Series A Preferred Stock of the Company, Titan was granted the
right, exercisable in prescribed circumstances, to demand or to participate in
certain registrations of the Company's securities under the Securities Act of
1933, as amended.
From its inception in November 1992 until the completion of a bridge
financing in May and June 1995, the Company received loans from Titan to enable
it to fund its operations. At March 31, 1995, the aggregate amount of such loans
outstanding was $1,551,252. Upon the closing of the IPO, Titan converted its
loans into shares of the Company's Common Stock at the conversion rate of $4.40
per share. Subsequent to March 31, 1995, Titan made additional non-interest
bearing working capital advances to the Company in the aggregate amount of
$108,280, which amount was repaid from the proceeds of the bridge financing.
Since the Company's inception, Titan has provided certain executive and
administrative, financial, human resources, business development and regulatory
services to the Company. The Company pays Titan for such services on a quarterly
basis. The Company also pays for any out-of-pocket expenses incurred by Titan in
providing the services to the Company. During the period from inception through
December 31, 1993, the year ended December 31, 1994 and the year ended December
31, 1995, the Company incurred expenses in the aggregate of $205,000, $523,000
and $376,000, respectively, to Titan pursuant to the services arrangement.
During the fiscal year ended December 31, 1995, the Company used certain
facilities leased by Titan. In January 1996 the Company entered into a new
facility lease with an unrelated party. Furthermore, the Company uses equipment
leased by Titan and reimburses Titan on a quarterly basis for the expenses
incurred by Titan with respect to such use. The Company and three other
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majority-owned subsidiaries of Titan have entered into a sublease and assignment
of such lease with Titan. At August 30, 1996, the amount outstanding under the
equipment lease was $826,716.
In May 1994, the Company issued 16,372 shares of Common Stock to Peter
M. Kash, a director of the Company, for nominal consideration.
In July 1994, Louis R. Bucalo, Chairman of the Board of the Company,
received options to purchase 15,052 shares of Common Stock at an exercise price
of $.29 per share.
In May 1994, nine members of Titan's Board of Directors, including
Lindsay A. Rosenwald and Peter M. Kash, directors of the Company, each received
options under the Company's 1993 Stock Option Plan to purchase 335 shares of
Common Stock at an exercise price of $.29 per share.
In April 1995, the Company entered into an employment agreement with S.
Mark Moran. In connection therewith, the Company granted Dr. Moran options to
purchase 62,846 shares of Common Stock at an exercise price of $.58 per share.
The shares underlying the foregoing option grants are subject to
repurchase by the Company under certain circumstances.
On August 8, 1995, the Company granted Titan a one-year option to
purchase up to 400,000 shares of Common Stock. The exercise price of the option
is currently $6.00 per share payable by the delivery of at least $10,000 in cash
and 10% promissory note evidencing the balance. Such note will be payable on the
earlier of 60 days or Titan's receipt of more than $5,000,000 of gross proceeds
from an offering of its securities. In July 1996, the Company extended the
option through September 8, 1996 in order to allow the Company and Titan an
opportunity to renegotiate the terms of such option as well as other possible
financing transactions.
The Company believes that all of the transactions set forth above were
made on terms no less favorable to the Company than could have been obtained
from unaffiliated third parties. The Company has adopted a policy that all
future transactions, including loans, between the Company and its officers,
directors, principal stockholders and their affiliates will be approved by a
majority of the Board of Directors, including a majority of the independent and
disinterested outside directors on the Board of Directors, and will continue to
be on terms no less favorable to the Company than could be obtained from
unaffiliated third parties.
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AMENDMENT OF THE COMPANY'S
CERTIFICATE OF INCORPORATION
TO CHANGE THE NAME OF THE COMPANY
At a meeting held on May 10, 1996, the Board of Directors unanimously
approved an amendment to the Company's Certificate of Incorporation which would
change the name of the Company to Ansan Pharmaceuticals, Inc. The text of the
proposed amendment to the Certificate of Incorporation is set forth in Exhibit A
to this Proxy Statement.
The Board of Directors has determined to change the name of the Company
in order to give the public, financial community and pharmaceutical industry a
clearer understanding of the nature of the Company's business. If the amendment
is adopted, shareholders will not be required to exchange outstanding stock
certificates for new certificates.
The Board of Directors recommends that the shareholders vote FOR
adoption of the amendment to the Company's Certificate of Incorporation.
APPOINTMENT OF INDEPENDENT AUDITORS
The Management of the Company recommends the appointment of Ernst &
Young LLP, independent certified public accountants, as the Company's
independent auditors. Ernst & Young LLP has been the Company's auditors for the
past three fiscal years and has no direct or indirect financial interest in the
Company. A representative of Ernst & Young LLP is expected to be present at the
Annual Meeting of Shareholders with the opportunity to make a statement if he or
she desires to do so, and shall be available to respond to appropriate
questions.
GENERAL
The Management of the Company does not know of any matters other than
those stated in this Proxy Statement which are to be presented for action at the
meeting. If any other matters should properly come before the meeting, it is
intended that proxies in the accompanying form will be voted on any such other
matters in accordance with the judgment of the persons voting such proxies.
Discretionary authority to vote on such matters is conferred by such proxies
upon the persons voting them.
The Company will bear the cost of preparing, printing, assembling and
mailing the proxy, Proxy Statement and other material which may be sent to
Shareholders in connection with this solicitation. It is contemplated that
brokerage houses will forward the proxy materials to beneficial owners at the
request of the Company. In addition to the solicitation of proxies by use of the
mails, officers and regular employees of the Company may solicit proxies without
H:\DOCS\BTPM_NY_\77\0044920.04
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additional compensation, by telephone or telegraph. The Company does not
expect to pay any compensation for the solicitation of proxies.
The Company will provide without charge to each person being solicited
by this Proxy Statement, on the written request of any such person, a copy of
the Annual Report of the Company on Form 10-KSB for the year ended December 31,
1995 (as filed with the Securities and Exchange Commission) including the
financial statements thereto. All such requests should be directed to Ansan,
Inc., 400 Oyster Point Boulevard, Suite 435, South San Francisco, California
94080, Attention: Secretary.
SHAREHOLDER PROPOSALS
The Annual Meeting of Shareholders for the fiscal year ending December
31, 1996 is expected to be held in June 1997. All proposals intended to be
presented at the Company's next Annual Meeting of Shareholders must be received
at the Company's executive office no later than May 8, 1997, for inclusion in
the Proxy Statement and form of proxy related to that meeting.
By Order of the Board of Directors,
S. Mark Moran, M.D.,
President and Chief Executive Officer
Dated: September 6, 1996
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EXHIBIT A
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
ANSAN, INC.
ANSAN, INC., a corporation organized and existing under the
laws of the State of Delaware (the "Corporation"), pursuant to the provisions of
the General Corporation Law of the State of Delaware (the "GCL"), DOES HEREBY
CERTIFY as follows:
FIRST: The Certificate of Incorporation of the Corporation is
hereby amended by deleting ARTICLE FIRST of the Certificate of Incorporation in
its present form and substituting therefor a new ARTICLE FIRST in the following
form:
FIRST: The name of the corporation (hereinafter called the
"Corporation") is Ansan Pharmaceuticals, Inc.
SECOND: The amendment to the Certificate of Incorporation of
the Corporation set forth in this Certificate of Amendment has been duly adopted
in accordance with the applicable provisions of Section 242 of the GCL (a) the
Board of Directors of the Corporation having duly adopted a resolution setting
forth such amendment and declaring its advisability and submitting it to the
stockholders of the Corporation for their approval, and (b) the stockholders of
the Corporation having duly adopted such amendment by vote of the holders of a
majority of the outstanding stock entitled to vote thereon at the annual meeting
of shareholders called and held upon notice in accordance with Section 222 of
the GCL.
* * *
A-1
IN WITNESS WHEREOF, the Corporation has caused its corporate
seal to be hereunto affixed and this Certificate of Amendment to be signed by S.
Mark Moran, M.D., its President, and attested by James M. Ahlers, its Secretary,
this day of October, 1996.
---
ANSAN, INC.
By:
----------------------------------
S. Mark Moran, M.D.
President
[CORPORATE SEAL]
ATTEST:
- - - -----------------------------------
James M. Ahlers
Secretary
A-1
PRELIMINARY
PROXY
ANSAN, INC.
ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Dr. S. Mark Moran or James M. Ahlers as
proxy to represent the undersigned at the Annual Meeting of Shareholders to be
held at 400 Oyster Point Boulevard, Suite 435, South San Francisco, California
94080 on October 22, 1996 at 10:00 a.m., local time, and at any adjournments
thereof, and to vote the shares of Common Stock the undersigned would be
entitled to vote if personally present, as indicated below.
1. Election of Directors
FOR all nominees listed below WITHHOLDING AUTHORITY
(except as marked to the --- to vote for all ---
contrary below) nominees listed below
Louis R. Bucalo, M.D., S. Mark Moran, M.D., Lindsay A.
Rosenwald, M.D., Peter M. Kash, Richard Sperber, Alan R.
Timms, Ph.D., Ilan Cohn, Ph.D. and David Naveh, Ph.D.
(INSTRUCTION: To withhold authority to vote for any individual
nominee, print that nominee's name on the line provided below.)
- - - ------------------------------------------------------------------------------
2. Approval of an amendment to the Company's Certificate of Incorporation to
change the name of the Company to Ansan Pharmaceuticals, Inc.
FOR AGAINST ABSTAIN
--- --- ---
3. Approval and ratification of the appointment of Ernst & Young LLP as
independent auditors.
FOR AGAINST ABSTAIN
--- --- ---
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-1-
THE SHARES OF COMMON STOCK REPRESENTED BY THIS PROXY WILL BE VOTED AS
DIRECTED; HOWEVER, IF NO DIRECTION IS GIVEN, THE SHARES OF COMMON STOCK WILL BE
VOTED FOR THE ELECTION OF THE NOMINEES, FOR THE APPROVAL OF THE AMENDMENT TO THE
CERTIFICATE OF INCORPORATION AND FOR THE APPROVAL AND RATIFICATION OF THE
APPOINTMENT OF ERNST & YOUNG LLP AS THE INDEPENDENT AUDITORS OF THE COMPANY.
If any other business is presented at the meeting, this proxy will be
voted by those named in this proxy in their best judgment. At the present time,
the Board of Directors knows of no other business to be presented at the
meeting.
DATED: , 1996
-------------------
----------------------------------
Signature
----------------------------------
Signature if held jointly
(Please date, sign as name
appears at the left, and
return promptly. If the
shares are registered in
the names of two or more
persons, each person should
sign. When signing as
Corporate Officer, Partner,
Executor, Administrator,
Trustee or Guardian, please
give full title. Please
note any changes in your
address alongside the
address as it appears in
the proxy.)
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