<PAGE>
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:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only
(as permitted by Rule 14a-
6(e)(2))
[X] Definitive Proxy Statement
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
ALZA CORPORATION
(Name of Registrant as Specified In Its Certificate)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] 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:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[_] 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 for 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:
2) Form, Schedule or Registration Statement No.:
3)Filing Party:
4) Date Filed:
<PAGE>
ALZA CORPORATION
----------------
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER 31, 2000 AT 10:30 A.M.
To the Stockholders of ALZA Corporation:
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders of ALZA
Corporation will be held at 1900 Charleston Road, Mountain View, California,
on Tuesday, October 31, 2000 at 10:30 a.m., for the following purpose:
To approve an amendment to the Restated Certificate of Incorporation of
ALZA that shall: (1) increase the number of authorized shares of ALZA's Common
Stock from its current level of 300,000,000 to 1,000,000,000 shares; (2)
effect a two-for-one stock split of currently issued and outstanding shares of
Common Stock (the "Stock Split"); and (3) change the par value of the Common
Stock from $0.01 to $0.005 per share.
The increase in the number of authorized shares of Common Stock would make
additional shares available for such purposes as the Board of Directors may
determine from time to time to be advantageous for ALZA, including but not
limited to future stock dividends and stock splits, acquisitions and the
raising of additional capital. The number of outstanding shares of Common
Stock will double as a result of the Stock Split and the Board anticipates
that such increase in the number of outstanding shares of Common Stock will
place the market price of the Common Stock in a range more attractive to
investors and increase trading liquidity.
Only holders of record of ALZA's Common Stock at the close of business on
September 26, 2000 are entitled to notice of and to vote at the Special
Meeting, and at any adjournment or postponement thereof.
By Order of the Board of Directors,
JULIAN N. STERN
Secretary
Mountain View, California
October 3, 2000
WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE SIGN THE
ACCOMPANYING PROXY CARD AND RETURN IT AS SOON AS POSSIBLE IN THE
ACCOMPANYING POSTPAID ENVELOPE. YOUR DOING SO MAY SAVE ALZA THE EXPENSE OF A
SECOND MAILING.
<PAGE>
ALZA CORPORATION
----------------
PROXY STATEMENT FOR SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER 31, 2000
To the Stockholders of ALZA Corporation:
The accompanying proxy is solicited on behalf of the Board of Directors
(the "Board") of ALZA Corporation ("ALZA"), a Delaware corporation, for use at
a special meeting of the stockholders of ALZA (the "Special Meeting"), or at
any adjournment or postponement thereof, for the purpose set forth herein and
in the accompanying Notice of Special Meeting of Stockholders. The Special
Meeting will be held at 10:30 a.m. on Tuesday, October 31, 2000 at ALZA's
headquarters located at 1900 Charleston Road, Mountain View, California 94043;
telephone number (650) 564-5000.
Only holders of record of ALZA's Common Stock as of the close of business
on September 26, 2000 (the "Record Date") are entitled to notice of, and to
vote at, the Special Meeting and any adjournments or postponements thereof. At
the close of business on that date, ALZA had outstanding 118,126,480 shares of
its Common Stock, par value $0.01 per share. Holders of Common Stock are
entitled to one vote for each share of Common Stock held. Under Delaware law,
no business shall be transacted at the Special Meeting except for the matter
set forth in the accompanying Notice of Special Meeting of Stockholders (which
matter is further described below in this Proxy Statement). No stockholder
shall be entitled to cumulate votes for such matter.
Any holder of Common Stock giving a proxy in the form accompanying this
Proxy Statement has the power to revoke the proxy prior to its use. A proxy
can be revoked (i) by an instrument of revocation delivered prior to the
Special Meeting to the Secretary of ALZA, (ii) by a duly executed proxy
bearing a later date or time than the date or time of the proxy being revoked
or (iii) at the Special Meeting if the stockholder is present and elects to
vote in person. Mere attendance at the Special Meeting will not serve to
revoke a proxy.
Broker non-votes and shares held by stockholders present in person or by
proxy at the meeting but abstaining on a vote will be counted in determining
whether a quorum is present at the Special Meeting. For the proposal being
considered at the Special Meeting, abstentions by stockholders present in
person or by proxy and broker non-votes will have the effect of votes against
the proposal for purposes of determining whether or not the proposal has been
approved.
This Proxy Statement and the accompanying proxy card are being mailed to
ALZA stockholders on or about October 3, 2000. ALZA may reimburse brokerage
firms and other persons representing beneficial owners of shares for their
expenses in forwarding solicitation materials to such beneficial owners. In
addition to soliciting proxies by mail, certain directors, officers and other
employees of ALZA may solicit proxies by personal interview, telephone or
facsimile, without special compensation. Any costs of such solicitation will
be borne by ALZA.
AMENDMENT OF THE RESTATED CERTIFICATE OF INCORPORATION OF ALZA TO (1) INCREASE
THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK TO 1,000,000,000; (2) EFFECT A
TWO-FOR-ONE STOCK SPLIT AND (3) CHANGE THE PAR VALUE OF THE COMMON STOCK TO
$0.005 PER SHARE
The Restated Certificate of Incorporation of ALZA currently authorizes an
aggregate of 300,100,000 shares of capital stock, consisting of 100,000 shares
of Preferred Stock (par value $0.01 per share) and 300,000,000 shares of
Common Stock (par value $0.01 per share). The proposed amendment to the
Restated Certificate of
<PAGE>
Incorporation would (1) increase the number of authorized shares of Common
Stock to 1,000,000,000, thus bringing the total number of authorized shares of
capital stock for all classes to 1,000,100,000; (2) effect a two-for-one stock
split by changing and converting each of the issued and outstanding shares of
Common Stock of ALZA to two shares of Common Stock (the "Stock Split"); and
(3) change the par value of the Common Stock from $0.01 to $0.005 per share.
The additional shares of Common Stock for which authorization is sought would
be a part of the existing class of Common Stock and, if and when issued, would
have the same rights and privileges as the currently outstanding shares of
Common Stock. These changes would be accomplished by amending the first
paragraph of Article 4 of the Restated Certificate of Incorporation to read as
follows:
4. The corporation is authorized to issue two classes of stock, which shall
be known as Preferred Stock and Common Stock. The total number of shares
of stock of all classes that this corporation is authorized to issue is
1,000,100,000. Each share of Preferred Stock of this corporation shall
have a par value of $0.01 and each share of Common Stock of this
corporation shall have a par value of $0.005. The total number of shares
of Preferred Stock which this corporation is authorized to issue is
100,000. The total number of shares of Common Stock which this
corporation is authorized to issue is 1,000,000,000. At the effective
time of this Certificate of Amendment to the Restated Certificate of
Incorporation, each of the issued and outstanding shares of Common Stock
of the corporation shall be changed and converted into two (2) shares of
Common Stock of the corporation.
Purposes and Effects of the Proposed Increase in the Number of Authorized
Shares of Common Stock
The increase in the number of authorized shares of Common Stock would make
additional shares of Common Stock available for issuance for such purposes as
the Board may determine to be advantageous for ALZA, including but not limited
to future stock dividends and stock splits, acquisitions and the raising of
additional capital. Except with respect to shares that will be issued through
the Stock Split, shares reserved for issuance under ALZA's stock option plans,
shares reserved for sale under ALZA's employee stock purchase plan and shares
reserved for issuance upon conversion of ALZA's outstanding convertible
debentures, as of the date of this Proxy Statement ALZA does not have any
agreements, commitments or plans with respect to the issuance of any
additional shares of Common Stock. If the Board deems it to be in the
interests of ALZA and its stockholders to issue additional shares of Common
Stock in the future, the Board generally will not seek further authorization
by vote of ALZA's stockholders (unless such authorization is otherwise
required by law or regulation). The proposal to increase the number of
authorized shares of Common Stock was approved by the unanimous vote of the
directors present at a meeting of the Board held on September 11, 2000.
The increase in the number of authorized shares of Common Stock could have
an anti-takeover effect. If the Board desired to issue additional shares in
the future, such issuance could dilute the voting power of a person seeking
control of ALZA, thereby deterring or rendering more difficult a merger,
tender offer, proxy contest or an extraordinary corporate transaction opposed
by ALZA. However, the proposal submitted in this Proxy Statement is not being
recommended in response to any specific effort of which ALZA is aware to
obtain control of or to acquire ALZA.
Purposes and Effects of the Proposed Two-for-One Common Stock Split
The Board anticipates that the increase in the number of outstanding shares
of Common Stock resulting from a two-for-one Stock Split will place the market
price of the Common Stock in a range more attractive to investors,
particularly individual investors, and will improve the trading liquidity of
the Common Stock. The Common Stock is listed for trading on the New York Stock
Exchange and ALZA will apply for listing of the additional shares of Common
Stock to be issued in the event the proposed Stock Split is approved. If the
proposal is adopted, each stockholder of record at the close of business on
November 1, 2000 would be the record owner of, and entitled to receive, a
certificate or certificates representing one additional share of Common Stock,
par value $0.005 per share, for each share of Common Stock then owned of
record by such stockholder. Outstanding certificates representing shares of
Common Stock should be retained by each stockholder and should not be returned
to ALZA or to its transfer agent. It will not be necessary to submit
outstanding certificates for exchange.
2
<PAGE>
In addition, if effected, the proposed Stock Split will result in appropriate
adjustments under ALZA's stock option and employee stock purchase plans, to
ALZA's Rights Agreement dated as of December 17, 1999 and to the Indentures
between ALZA and Chase Manhattan Bank and Trust Company, National Association
dated as of July 1, 1994 and July 28, 2000.
ALZA is of the opinion that the proposed Stock Split would result in no
gain or loss or realization of taxable income to owners of Common Stock under
existing United States federal income tax laws. The cost basis for tax
purposes of each new share and each retained share of Common Stock would be
equal to one-half of the cost basis for tax purposes of the corresponding
share immediately preceding the Stock Split. In addition, the holding period
for the additional shares issued pursuant to the Stock Split would be deemed
to be the same as the holding period for the corresponding shares of Common
Stock immediately preceding the Stock Split. The laws of jurisdictions other
than the United States may impose income taxes on the issuance of the
additional shares and stockholders subject to such laws are urged to consult
their tax advisors.
If stockholders dispose of their shares after the Stock Split, they may pay
higher brokerage commissions on the same relative interest in ALZA because
that interest is represented by a greater number of shares. Stockholders may
wish to consult their brokers to ascertain the brokerage commission that would
be charged for disposing of the greater number of shares.
Purposes and Effects of the Proposed Change in the Par Value of ALZA's Common
Stock
The change in the par value of ALZA's Common Stock will eliminate the need
to adjust the stockholders' equity account balances in ALZA's financial
statements following the proposed Stock Split. If such change to the par value
were not made, then effecting the proposed Stock Split would require making
adjustments to certain stockholders' equity account balances. Certificates
representing shares of Common Stock, par value $0.01 per share, will be deemed
to have adjusted automatically to the revised par value of $0.005 per share.
Therefore, it will not be necessary to submit outstanding certificates for
exchange.
Board Recommendation and Vote Required
The Board believes that approval of the proposal to amend the Restated
Certificate of Incorporation will place the market price of the Common Stock
of ALZA in a range more attractive to investors, particularly individual
investors, will improve trading liquidity and will provide greater flexibility
for issuance of additional shares in the future. Accordingly, the Board
recommends that the stockholders vote "FOR" the amendment to the Restated
Certificate of Incorporation. The affirmative vote of a majority of the shares
of Common Stock issued and outstanding as of the Record Date and entitled to
vote at the Special Meeting is required to approve the proposal.
3
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership of shares of ALZA's
Common Stock as of September 15, 2000, except as otherwise noted, by (i) each
person, entity or "group" of persons or entities known by ALZA to be
beneficial owners of more than 5% of ALZA's Common Stock; (ii) each director
of ALZA; (iii) ALZA's Chief Executive Officer and each of ALZA's other four
most highly compensated executive officers who were serving as executive
officers as of December 31, 1999; and (iv) all directors and executive
officers as a group. Except as described below, each person has sole voting
and investment power with respect to the Common Stock described in the table.
<TABLE>
<CAPTION>
Amount and Nature of Percent of
Name of Person or Identity of Group Beneficial Ownership(1) Class(2)
----------------------------------- ---------------------- ----------
<S> <C> <C>
J.P. Morgan & Co. Incorporated and its 11,492,482 9.7%
subsidiaries(3)...........................
60 Wall Street
New York, NY 10260
Brinson Partners, Inc.(4).................. 5,902,802 5.0
209 South LaSalle Street
Chicago, IL 606040
Dr. William R. Brody....................... 16,500 --
Bruce C. Cozadd............................ 118,816 --
Dr. Robert J. Glaser....................... 16,884 --
Dr. I. Craig Henderson..................... 159,770 --
Dr. Ernest Mario........................... 1,031,570 --
Dean O. Morton............................. 16,000 --
Denise M. O'Leary.......................... 16,000 --
Dr. Samuel R. Saks......................... 86,615 --
Peter D. Staple............................ 133,059 --
Isaac Stein................................ 15,600 --
Julian N. Stern............................ 105,575 --
Dr. James W. Young(5)...................... 5,088 --
All current directors and current executive
officers as a group (18 persons).......... 2,149,226 1.8
</TABLE>
--------
(1) Includes outstanding stock options, exercisable on or before November 15,
2000, to purchase the number of shares of ALZA's Common Stock as follows:
12,000 for Dr. Brody; 88,600 for Mr. Cozadd; 6,000 for Dr. Glaser; 152,998
for Dr. Henderson; 909,000 for Dr. Mario; 16,000 for Mr. Morton; 16,000
for Ms. O'Leary; 70,000 for Dr. Saks; 105,000 for Mr. Staple; 4,000 for
Mr. Stein; 14,000 for Mr. Stern; and 1,681,168 for all executive officers
and directors as a group. Also includes 48,083 shares of restricted stock
for Dr. Mario; 16,615 shares of restricted stock for Dr. Saks; 24,975
shares of restricted stock for each of Mr. Cozadd and Mr. Staple; and
217,948 shares of restricted stock for all executive officers and
directors as a group. Each holder of restricted stock possesses sole
voting power with respect to the shares held. The restricted shares are
subject to certain restrictions, including the risk of forfeiture, which
lapse over time during the holder's employment with ALZA and upon the
occurrence of certain events.
(2) Percentages are not shown if holdings total less than 1% of total
outstanding shares.
(3) Information is as provided by the holder in its Schedule 13G/A filed with
the Securities and Exchange Commission (the "SEC") as of February 2, 2000.
As to such shares, the holder has provided the following information: sole
voting power--8,421,092 shares; shared voting power--59,847 shares; sole
dispositive power--11,340,573 shares; and shared dispositive power--
130,008 shares.
4
<PAGE>
(4) Information is as provided by the holder in its Schedule 13G/A filed with
the SEC as of February 25, 2000. As to such shares, the holder has provided
the following information: sole voting power--5,863,302 shares; and shared
dispositive power--5,902,802 shares. The Schedule 13G/A also includes UBS
AG, which disclaims beneficial ownership of all the shares.
(5) Dr. Young was employed at ALZA through April 28, 2000.
OTHER MATTERS
The only business to be conducted and acted upon at the Special Meeting is
the approval of the amendment to the Restated Certificate of Incorporation.
Under Delaware law no other business shall be transacted at this Special
Meeting. However, should any procedural matters properly come before the
meeting, it is the intention of the proxy holders named in the enclosed form of
proxy to vote the shares they represent as the Board of Directors may
recommend.
Proposals of Stockholders
ALZA will, in future proxy statements distributed by ALZA, include
stockholder proposals complying with the applicable rules of the SEC and the
procedures set forth in ALZA's Bylaws. In order for a proposal by a stockholder
to be included in the proxy statement distributed by ALZA relating to the
annual meeting of stockholders to be held in the spring of 2001, that proposal
must be received in writing by the Secretary of ALZA no later than December 15,
2000.
5
<PAGE>
Separate from the requirements described above concerning the notice
required for a proposal to be included in the proxy statement distributed by
ALZA, ALZA's Bylaws also provide for certain advance notice of nominations by
stockholders for election of stockholder nominees as directors at an annual
meeting, and proposals for the inclusion of other business at an annual
meeting of stockholders, even if such nominations or proposals are not to be
included in the ALZA proxy statement. In addition to meeting other
requirements specified in the Bylaws, the required notice by the stockholder
for the annual meeting in the year 2001 must be received in writing by the
Secretary of ALZA no later than January 29, 2001; provided, however, that if
the date of the annual meeting to be held in the year 2001 is advanced more
than 30 days prior to, or delayed by more then 30 days after, the anniversary
of the 2000 annual meeting, the stockholder's notice must be received no later
than the close of business on the later of (i) the 90th day prior to such
annual meeting or (ii) the 10th day following the day on which public
announcement of the meeting is first made.
By Order of the Board of Directors,
JULIAN N. STERN
Secretary
Mountain View, California
Dated: October 3, 2000
PRINTED ON RECYCLED PAPER
YOU ARE CORDIALLY INVITED TO ATTEND THE SPECIAL MEETING IN PERSON. WHETHER
OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE REQUESTED TO SIGN AND RETURN
THE ACCOMPANYING PROXY CARD AS SOON AS POSSIBLE IN THE ACCOMPANYING POSTPAID
ENVELOPE. YOUR DOING SO MAY SAVE ALZA THE EXPENSE OF A SECOND MAILING.
6
<PAGE>
2350-SPPS-00
<PAGE>
This Proxy is solicited on behalf of the Board of Directors
of
ALZA CORPORATION
in conjunction with the
SPECIAL MEETING OF STOCKHOLDERS
to be held on
October 31, 2000
The undersigned hereby appoint(s) DR. ERNEST MARIO, PETER D. STAPLE and
BRUCE C. COZADD, or any of them, each with full power of substitution, the
lawful attorneys and proxies of the undersigned to attend the Special Meeting of
Stockholders of ALZA CORPORATION to be held on October 31, 2000, at 10:30 a.m.
and any adjournments or postponements thereof, to vote the number of shares the
undersigned would be entitled to vote if personally present on the matter set
forth below, and to vote in their discretion upon any other business that may
properly come before the meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BY
THE UNDERSIGNED STOCKHOLDER(S). IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED "FOR" PROPOSAL 1. THIS PROXY MAY BE REVOKED AT ANY TIME PRIOR TO THE TIME
IT IS VOTED BY ANY MEANS DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
<PAGE>
--------------------------------------------------------------------------------
THE BOARD OF DIRECTORS OF ALZA CORPORATION UNANIMOUSLY RECOMMENDS A VOTE "FOR"
PROPOSAL 1.
1. To approve an amendment to the Restated Certificate of Incorporation of ALZA
Corporation to (1) increase the number of authorized shares of Common Stock to
1,000,000,000; (2) effect a two-for-one stock split by changing and converting
each of the issued and outstanding shares of Common Stock of ALZA to two shares
of Common Stock; and (3) change the par value of the Common Stock from $0.01 to
$0.005 per share.
For Against Abstain
[_] [_] [_]
Please date and sign exactly as name(s) appear(s) hereon. If shares are held
jointly, each holder should sign. Please give full title and capacity in which
signing if not signing as an individual stockholder.
Signature(s):
_____________________________________________________
_____________________________________________________
Dated: __________________________________, 2000
(Be sure to date Proxy.)
Please mark, sign, date and return the proxy card promptly, using the enclosed
return-addressed and postage-paid envelope.
