IMMUNOMEDICS, INC.
300 American Road
Morris Plains, New Jersey 07950
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
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November 5, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
IMMUNOMEDICS, INC. (the "Company") will be held at the Company's offices at 300
American Road, Morris Plains, New Jersey 07950, on Wednesday, November 5, 1997,
at 10:00 a.m., for the following purposes:
1. To elect six Directors;
2. To ratify the selection of KPMG Peat Marwick LLP as the Company's
independent auditors for the fiscal year ending June 30, 1998; and
3. To transact such other business as may properly come before the
meeting or any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on September 29,
1997 as the record date for determining all stockholders entitled to receive
notice of the Annual Meeting and to vote at such meeting or any adjournment or
adjournments thereof.
The Board of Directors appreciates and welcomes stockholder participation
in the Company's affairs. Whether or not you plan to attend the Annual Meeting,
please vote by completing, signing and dating the enclosed proxy and returning
it promptly to the Company in the enclosed self-addressed, postage-prepaid
envelope. If you attend the meeting, you may revoke your proxy and vote your
shares in person.
By Order of the Board of Directors,
PHYLLIS PARKER,
SECRETARY
October 7, 1997
<PAGE>
IMMUNOMEDICS, INC.
300 American Road
Morris Plains, New Jersey 07950
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PROXY STATEMENT
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ANNUAL MEETING OF STOCKHOLDERS
November 5, 1997
GENERAL INFORMATION
This Proxy Statement is furnished to the stockholders of Immunomedics,
Inc., a Delaware corporation (the "Company"), in connection with the
solicitation of proxies by the Board of Directors of the Company (the "Board of
Directors") for use at the Annual Meeting of Stockholders of the Company to be
held on November 5, 1997, and any adjournment or adjournments thereof (the
"Annual Meeting"). A copy of the notice of meeting, the Company's Annual Report
for the fiscal year ended June 30, 1997 and form of proxy accompany this Proxy
Statement and are first being sent to stockholders on or about October 7, 1997.
Only stockholders of record at the close of business on September 29,
1997, the record date for the Annual Meeting, will be entitled to notice of and
to vote at the Annual Meeting. On the record date, there were issued and
outstanding 36,363,002 shares of the Company's Common Stock, par value $.01 per
share (the "Common Stock"). Each share of Common Stock entitles the holder to
one vote with respect to each of the matters to be voted upon at the Annual
Meeting. The Common Stock is the only class of outstanding securities of the
Company entitled to vote at the Annual Meeting.
Presence in person or by proxy of the holders of 18,181,502 shares of
Common Stock will constitute a quorum at the Annual Meeting. Assuming a quorum
is present, the affirmative vote of the holders of at least a majority of votes
present and entitled to be cast at the Annual Meeting is required for (i) the
election of Directors, (ii) the ratification of the selection of KPMG Peat
Marwick LLP as independent auditors for the current fiscal year, and (iii)
except as otherwise required by Delaware Law or the Company's Certificate of
Incorporation, any other matters that properly come before the meeting. If a
stockholder, present in person or by proxy, abstains on any matter, the
stockholder's shares will not be voted on such matter. Abstentions may be
specified on all proposals submitted to a stockholder vote other than the
election of directors. Abstentions will be counted as present for purposes of
determining the existence of a quorum regarding the proposal on which the
abstention is noted. Thus, an abstention from voting on a matter has the same
legal effect as a vote "against" the matter, even though a stockholder may
interpret such action differently. A proxy submitted by a stockholder also may
indicate that all or a portion of the shares represented by such proxy are not
being voted by such stockholder with respect to a particular matter. This could
occur, for example, when a broker is not permitted to vote shares held in street
name on certain matters in the absence of instructions from the beneficial owner
of the shares.
If a proxy in the accompanying form is properly executed and returned, the
shares represented thereby will be voted as instructed in the proxy. If no
instructions are given, the persons named in the proxy intend to vote in favor
of (i) the nominees for election as Directors as set forth below and (ii) the
ratification of the selection of KPMG Peat Marwick LLP as independent auditors
for the current fiscal year.
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Brokers holding shares in street name, who do not receive instructions,
are entitled to vote on the election of Directors and ratification of the
appointment of the independent auditors, since such matters are considered to be
routine. Since a broker is not required to vote shares held in "street name" in
the absence of instructions from the beneficial stockholder, a stockholder's
failure to instruct his broker may result in the stockholder's shares not being
voted.
Each proxy granted may be revoked by the person granting it at any time
(i) by giving written notice to such effect to the Secretary of the Company,
(ii) by execution and delivery of a proxy bearing a later date, or (iii) by
attendance and voting in person at the Annual Meeting, except as to any matter
upon which, prior to such revocation, a vote shall have been cast pursuant to
the authority conferred by such proxy. The mere presence at the Annual Meeting
of a person appointing a proxy does not revoke the appointment.
ELECTION OF DIRECTORS
NOMINEES
The Certificate of Incorporation of the Company provides that the number
of Directors of the Company shall be fixed by resolution of the Board of
Directors. Such number currently has been fixed at six persons. At the Annual
Meeting, six persons will be elected to the Board of Directors to serve until
the next annual meeting and until their successors have been elected and
qualify. The persons named as proxies in the accompanying proxy intend to vote
FOR these nominees of the Board of Directors or, if any of the nominees should
be unable to serve, for such substitute nominee(s) as the Board of Directors
then may propose.
The following table sets forth information about the nominees, each of
whom is currently serving as a Director of the Company:
<TABLE>
<CAPTION>
YEAR FIRST
ELECTED TO
BOARD OF
NAME AGE POSITIONS WITH THE COMPANY DIRECTORS
- ---- --- -------------------------- ---------
<S> <C> <C> <C>
David M. Goldenberg ................ 59 Chairman of the Board, Chief Executive 1982
Officer, Director (1)
W. Robert Friedman, Jr.............. 55 Director (3)(5)(6) 1997
Marvin E. Jaffe .................... 61 Director (2)(5) 1994
Richard R. Pivirotto ............... 67 Director (2)(4)(6) 1991
Warren W. Rosenthal ................ 74 Director (2)(3)(4)(6) 1983
Richard C. Williams ................ 54 Director (1)(2)(3)(4)(5) 1993
</TABLE>
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(1) Executive Committee member
(2) Audit Committee member
(3) Compensation Committee member
(4) Finance Committee member
(5) Research Review Committee member
(6) Governance and Nominating Committee member
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2
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Each current Director was elected as such at the Annual Meeting held on
November 6, 1996, except for Mr. Friedman, who was appointed as a Director on
June 25, 1997. No family relationship exists among the Directors of the Company
or between any of such persons and the Executive Officers of the Company.
Dr. David M. Goldenberg was the founder of the Company in July 1982 and,
since that time, has been Chairman of the Board of the Company. Dr. Goldenberg
has served as Chief Executive Officer since February 1994 and also served as
Chief Executive Officer of the Company from July 1982 through July 1992 and a
Treasurer since July 1996. Dr. Goldenberg was Professor of Pathology at the
University of Kentucky Medical Center from 1973 until 1983 and Director of such
University's Division of Experimental Pathology from 1976 until 1983. From 1975
to 1980, he also served as Executive Director of the Ephraim McDowell Community
Cancer Network, Inc., and from 1978 to 1980 he was President of the Ephraim
McDowell Cancer Research Foundation, Inc., both in Lexington, Kentucky. Dr.
Goldenberg is a graduate of the University of Chicago College and Division of
Biological Sciences (S.B.), the University of Erlangen-Nuremberg (Germany)
Faculty of Natural Sciences (Sc.D.), and the University of Heidelberg (Germany)
School of Medicine (M.D.). He has written or co-authored more than 900 articles,
book chapters and abstracts on cancer research, detection and treatment, and has
researched and written extensively in the area of radioimmunodetection using
radiolabeled antibodies. In addition to his employment with the Company, Dr.
Goldenberg is President of The Center for Molecular Medicine and Immunology
("CMMI"), an independent not-for-profit research center, and its clinical unit,
the Garden State Cancer Center. He also holds the positions of Adjunct Professor
of Microbiology and Immunology with the New York Medical College in Valhalla,
N.Y. In 1985 and again in 1992, Dr. Goldenberg received an "Outstanding
Investigator" grant award from the National Cancer Institute for his work in
radioimmunodetection and, in 1986, he received the New Jersey Pride Award in
Science and Technology. Dr. Goldenberg was honored as the ninth Herz Lecturer of
the Tel Aviv University Faculty of Life Sciences. In addition, Dr. Goldenberg
received the 1991 Mayneord 3M Award and Lectureship of the British Institute of
Radiology for his contributions to the development of radiolabeled monocolonal
antibodies used in the imaging and treatment of cancer. He was also named the
co-recipient of the 1994 Abbott Award by the International Society for
Oncodevelopmental Biology and Medicine.
W. Robert Friedman, Jr. has been a Senior Managing Director of Dominick &
Dominick, an investment banking firm, since July 1996 and has approximately 25
years of healthcare investment banking experience. Prior to joining Dominick &
Dominick, Mr. Friedman served as a managing director for the investment banking
firms of Furman Selz, LLC, from December 1994 to June 1996, and Robert Fleming
Inc., from December 1990 until December 1994. Mr. Friedman was a founding
principal of Montgomery Medical Ventures and currently is a member of The Board
of Directors of the Children's Health Fund. Mr. Friedman is a 1970 M.B.A.
graduate of The Wharton School.
Dr. Marvin E. Jaffe has been a consultant to the health care industry
since April 1994. From August 1988 until March 1994 he was president of the RW
Johnson Pharmaceutical Research Institute, where he was responsible for the
global research and development activities of a group of Johnson & Johnson
companies including Ortho and McNeil Pharmaceutical, Ortho Biotech and Cilag.
Prior to joining Johnson & Johnson, Dr. Jaffe held senior positions in drug
development at Merck & Co., Inc. He also serves as a Director of Chiroscience,
plc., a biopharmaceutical company, and Titan Pharmaceuticals, Inc., a
biopharmaceutical company focusing on neurological diseases and cancer.
Richard R. Pivirotto has been the President of Richard R. Pivirotto
Company, Inc., a management consulting firm in Greenwich, Connecticut, since
1981. Prior thereto, until 1981, Mr. Pivirotto had served as President and
Chairman of Associated Dry Goods Corp., a chain of retail department stores, of
which he also served as a Director until 1986. Mr. Pivirotto also serves as a
member of the Board of Directors of General American Investors Company, Inc., a
closed-end diversified management investment company, The Gillette Company, a
consumer products company, The New York Life Insurance Company, a life insurance
company and Westinghouse Electric Corp., a global company engaged in the media
industries and technologies business. Mr. Pivirotto serves as a Trustee of
Greenwich Hospital Corp., a Trustee Emeritus of Princeton University, as well as
a Trustee of General Theological Seminary. Mr. Pivirotto was a Trustee of The
Center for Molecular Medicine and Immunology from September 1989 until October
1991.
3
<PAGE>
Warren W. Rosenthal has been a private investor since 1989. Mr. Rosenthal
was Chairman of the Board of Directors of Jerrico, Inc., a food service company,
for more than thirty years prior thereto.
Richard C. Williams has been the President and Chief Executive Officer of
Conner-Thoele Limited, a financial and strategic advisory firm serving the
health care and pharmaceutical industries, since March 1989, and also is
Chairman of the Board of Medco Research, Inc., a company focused on developing
cardiovascular medicines and adenosine-based products. He also serves as
director of Vysis, Inc., a genomics diagnostic company. In addition to other
positions, Mr. Williams served as Chief Financial Officer of Erbamont, N.V., a
pharmaceutical company, from November 1983 until February 1989, and prior
thereto served in various financial positions with Field Enterprises, Abbott
International, Ltd., and American Hospital Supply Corporation.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE ELECTION
OF EACH OF THE NOMINEES NAMED HEREIN.
ADDITIONAL INFORMATION WITH RESPECT TO THE BOARD OF DIRECTORS AND ITS COMMITTEES
During the fiscal year ended June 30, 1997, the Board of Directors met
seven times. There are six standing committees of the Board of Directors which
are described below. During the fiscal year ended June 30, 1997, each Director
attended at least 75% of the aggregate of (i) all Board meetings, and (ii) all
Committee meetings of which he was a member.
The Executive Committee has all the power and authority to act on behalf
of the Board of Directors, to the extent permitted under Delaware law, in all
matters not designated to other committees. During the fiscal year ended June
30, 1997, the Executive Committee did not meet. Principal functions of the other
standing committees of the Board of Directors are summarized below:
The Audit Committee reviews the audited financial statements of the
Company, reviews with the Company's independent auditors the scope and results
of the audit engagement and recommends to the Board of Directors the employment
and termination of such auditors. During the fiscal year ended June 30, 1997,
the Audit Committee held three meetings. The Compensation Committee administers
and interprets the Company's 1983 and 1992 Stock Option Plans, approves options
granted thereunder and reviews standards and policies for compensation and
fringe benefit programs for the Company's employees (See "Executive Compensation
and Certain Relationships.") During the fiscal year ended June 30, 1997, the
Compensation Committee held six meetings.
The Finance Committee investigates new sources of capital and oversees
decisions regarding investment of the Company's funds. During the fiscal year
ended June 30, 1997, the Finance Committee held five meetings.
The Research Review Committee reviews research initiatives of the Company
and administers the Company's obligations under an agreement with CMMI
concerning the allocation of research projects. During the fiscal year ended
June 30, 1997, the Research Review Committee held two meetings.
The Governance and Nominating Committee considers and recommends to the
Board of Directors candidates for nomination to the Board of Directors. During
the fiscal year ended June 30, 1997, the Governance and Nominating Committee did
not meet.
The Company pays each of its non-employee Directors an annual fee of
$5,000, plus a per diem allowance of $1,000 for attendance at meetings and
committees thereof, and $500 per telephone conference. Directors are also
reimbursed for their out-of-pocket expenses incurred in attending such meetings.
In addition, in accordance with the terms of the 1992 Option Plan, each
non-employee Director receives an annual option on the first business day in
July to purchase 10,000 shares of the Common Stock at the then-prevailing market
price. See "Employee Compensation and Certain relationships - Stock Option
Plan." In addition, during fiscal 1997, the Company paid Rolf Henel, a Director
of the
4
<PAGE>
Company until June 25, 1997, consulting fees of $105,500. Pursuant to the terms
of a consulting agreement, dated December 16, 1996, between the Company and Mr.
Henel, Mr. Henel agreed, for a period of up to six months, to act as chief
operating officer and to devote at least 2-( days per week to the Company in
exchange for a fee of $17,500 per month. The consulting agreement was terminated
by mutual agreement on June 25, 1997. In addition, Mr. Henel was granted options
to purchase 25,000 shares of Common Stock (in addition to the options granted to
him on June 26, 1996 when he joined the Board of Directors). All of Mr. Henel's
options expired upon his resignation from the Board of Directors.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1997, the Compensation Committee of the Board of Directors
consisted of Messrs. Albert Angel, A. E. Cohen, Warren Rosenthal and Richard
Williams, each of whom was an outside Director during fiscal 1997. Messrs Angel
and Cohen each resigned as a Director, effective June 25, 1997.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely upon a review of Forms 3, 4 and 5 filed with the Securities
and Exchange Commission and the Company under the Securities Exchange Act of
1934 (the "Exchange Act") and a review of written representations received by
the Company, no person who at any time during fiscal 1997 was a Director,
Executive Officer or beneficial owner of more than 10% of the outstanding shares
of Common Stock failed to file, on a timely basis, reports required by Section
16(a) of the Exchange Act, except that (i) Warren Rosenthal, a Director of the
Company, filed a Form 5 for June 1997 inadvertently reporting late two
transactions involving the disposition of Common Stock, and (ii) Richard
Pivirotto, a Director of the Company, inadvertently filed late a Form 5 for June
1996 reporting one transaction involving the acquisition of an option to
purchase Common Stock.
5
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The following table sets forth, as of September 29, 1997, information
regarding the beneficial ownership of Common Stock (i) by each Director (each of
whom is a nominee for election at the Annual Meeting), (ii) by each Executive
Officer listed in the Summary Compensation Table, (iii) by all Directors and
current Executive Officers as a group (nine persons), and (iv) by each person or
group known by the Company to own beneficially in excess of five percent of the
Common Stock:
NUMBER OF SHARES PERCENT
NAME(1) OF COMMON STOCK OF CLASS
- ------- --------------- --------
David M. Goldenberg ........................... 13,409,257(2) 36.7%
W. Robert Friedman ............................ 0 --
Marvin E. Jaffe ............................... 15,200(3) *
Richard R. Pivirotto .......................... 85,000(4) *
Warren W. Rosenthal ........................... 295,020(5) *
Richard C. Williams ........................... 25,000(4) *
Hans J. Hansen ................................ 111,800(6) *
Carl M. Pinsky ................................ 75,500(4) *
Deborah Goldenberg ............................ 2,324,784(7) 6.4%
Eva Goldenberg ................................ 2,324,784(7) 6.4%
All Directors and Executive Officers as a group 14,075,277(8) 37.9%
- ----------
(1) Unless otherwise noted, the stockholders identified in this table have
sole voting and investment power. The address of each of the
stockholders listed in the above table who own more than 5% of the
Common Stock is c/o Immunomedics, Inc., 300 American Road, Morris
Plains, New Jersey 07950. All information in the table is based upon
reports filed by such persons with the Securities and Exchange
Commission and the Company and upon questionnaires submitted by such
persons to the Company in connection with the preparation of this
Proxy Statement.
(2) Consists of 7,852,243 shares held by Dr. Goldenberg, 307,692 shares
held by the David M. Goldenberg 1989 Trust Agreement, 200,000 shares
held by Escalon Corp. ("Escalon"), a company wholly-owned by Dr.
Goldenberg, 3,428,800 shares as to which Dr. Goldenberg has the right
to vote pursuant to a power of attorney granted to him by certain of
his children, 1,425,777 shares as to which Dr. Goldenberg has the
right to vote pursuant to an agreement with Hildegard Gruenbaum (his
former spouse), and 125,000 shares which may be acquired upon exercise
of options which are presently exercisable or will become exercisable
within 60 days of the date hereof (see "Executive Compensation and
Certain Relationships"), 1,495 shares held by Dr. Goldenberg's present
spouse and 68,250 shares which may be acquired by her upon exercise of
options which are presently exercisable or will become exercisable
within 60 days of the date hereof. Dr. Goldenberg disclaims beneficial
ownership with respect to all shares owned by Mrs. Goldenberg or Mrs.
Gruenbaum.
(3) Includes 15,000 shares which may be acquired upon the exercise of
options which are presently exercisable or will become exercisable
within 60 days of the date hereof (see "Executive Compensation and
Certain Relationships").
(4) Represents shares which may be acquired upon the exercise of options
which are presently exercisable or will become exercisable within 60
days of the date hereof (see "Executive Compensation and Certain
Relationships").
6
<PAGE>
(5) Consists of 45,232 shares held by Mr. Rosenthal, 227,000 shares which
may be acquired upon exercise of options which are presently
exercisable or will become exercisable within 60 days of the date
hereof (see "Executive compensation and Certain Relationships"),
10,000 shares held by a partnership of which Mr. Rosenthal and his
wife are the sole partners, 12,000 shares held by trusts of which Mr.
Rosenthal's wife is the trustee and over which she exercises sole
voting and investment power, and 788 shares held by Mr. Rosenthal's
wife. Mr. Rosenthal disclaims beneficial ownership with respect to all
shares owned by his wife.
(6) Consists of 1,000 shares held by Dr. Hansen, 110,000 shares which may
be acquired upon exercise of options which are presently exercisable
or will become exercisable within 60 days of the date hereof (see
"Executive Compensation and Certain Relationships"), and 800 shares
held by Dr. Hansen's wife. Dr. Hansen disclaims beneficial ownership
with respect to all shares owned by his wife.
(7) Consists of 864,700 shares held directly by each of Deborah and Eva
Goldenberg, 615,384 shares held by the David M. Goldenberg 1989 Trust
Agreement and the Hildegard Goldenberg 1989 Trust Agreement, of which
trusts Deborah Goldenberg and Eva Goldenberg as trustees, and 844,700
shares held by Deborah Goldenberg and Eva Goldenberg as trustees under
trust for the benefit of Denis C. Goldenberg. Deborah and Eva
Goldenberg have each signed a power of attorney granting Dr.
Goldenberg the right to vote the shares held by them in their
individual capacity.
(8) Includes 789,250 shares which may be acquired upon the exercise of
options which are presently exercisable or will become exercisable
within 60 days of the date hereof.
(*) Less than 1%.
The Company does not know of any arrangements, including a pledge by any
person of securities of the Company, the operation of which at a subsequent date
may result in a change in control of the Company.
EXECUTIVE COMPENSATION AND CERTAIN RELATIONSHIPS
COMPENSATION COMMITTEE REPORT
THE MATERIAL IN THIS REPORT AND IN THE PERFORMANCE GRAPH IS NOT SOLICITING
MATERIAL, IS NOT DEEMED FILED WITH THE SEC AND IS NOT INCORPORATED BY REFERENCE
IN ANY FILING OF THE COMPANY UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, WHETHER MADE BEFORE OR AFTER
THE DATE OF THIS PROXY STATEMENT AND IRRESPECTIVE OF ANY GENERAL INCORPORATION
LANGUAGE IN SUCH FILING.
COMPENSATION COMMITTEE RESPONSIBILITIES
The Company's compensation program is administered by the Compensation
Committee of the Board of Directors (the "Committee"), which is currently
comprised of two non-employee Directors. All actions of the Committee are
presented to the Board of Directors for ratification. The Committee reviews and
determines the salaries for corporate officers and key employees and reviews and
determines, by grade levels, employees who are eligible to participate in the
Company's incentive compensation plans. The Committee also oversees management
of the 1992 Option Plan, including the granting and certain terms of stock
options, and all other compensation and benefit plans. The Committee oversees
salary grade administration for the entire Company, which is used for
establishing merit increases and starting salaries for new employees and is the
basis for compensation reviews for all officers of the Company, including the
Chief Executive Officer. When deemed appropriate, the Committee also consults
with independent outside advisors for guidance on executive compensation issues.
7
<PAGE>
COMPENSATION POLICIES
The primary objective of the Company's compensation program is to offer
competitive compensation packages to attract, retain and motivate Company
employees. To achieve this objective, industry and regional compensation surveys
are used to help ensure that the Company's salary structure is competitive with
other biopharmaceutical companies of comparable size and stage of development,
both within and outside of the Company's geographical area. These surveys, in
conjunction with the Company's overall financial condition, are also used in the
process of determining annual merit increases for all employees.
The Company's compensation program currently consists of an annual base
salary, in certain select instances cash bonuses and, for employees at manager
level and above, annual awards of stock options. Initially, when an executive is
hired, a compensation package is developed based on the qualifications and
experience the individual brings to the Company. In certain instances, the
Company cannot match the cash compensation offered by large pharmaceutical
companies and larger biopharmaceutical companies and, therefore, supplements
salary with sizable grants of stock options. In addition, annual grants of stock
options are awarded based on the individual's and the Company's performance. The
Company believes that this granting of stock options provides an opportunity for
financial rewards not offered, either generally or to the same extent, in
larger, more mature companies. However, these options will only be of real value
if the Company is successful in achieving its business objectives, thereby
increasing stockholder value. Consequently, the employee's financial rewards are
closely aligned with the Company's performance and the value created for
stockholders.
Each year the executive receives an appraisal assessing the extent to
which pre-established individual goals have been achieved and the extent to
which the individual contributed to the overall success of the Company. This
appraisal process is reviewed in light of the Company's success in achieving its
overall business objectives. The executive's annual merit adjustment and stock
option award are derived from this appraisal process.
CHIEF EXECUTIVE OFFICER'S COMPENSATION
The compensation of the Company's Chief Executive Officer, David M.
Goldenberg, is administered pursuant to a five-year employment contract, which
was negotiated at arms-length and entered into between Dr. Goldenberg and the
Company on November 1, 1993 (see "Amended and Restated Employment Agreement with
Dr. Goldenberg"). Pursuant to the employment contract, Dr. Goldenberg is to
receive an annual base salary of not less than $220,000 and may receive annual
grants of stock options and/or a cash bonus, if the performance of his duties
are to the Board's satisfaction. Dr. Goldenberg's annual salary previously was
increased to $250,000, effective July 1, 1996.
Dr. Goldenberg's performance was reviewed by the Compensation Committee at
its June 25, 1997 meeting. The growth over the past year of the Company's
operations, under Dr. Goldenberg's leadership, was reviewed with specific
reference to the extent to which he contributed to the overall success of the
Company's achievements of its objectives. Specific consideration was given to
the progress made in research and development programs, clinical and regulatory
activities, adherence to budget, and third-party business development
opportunities. In addition, Dr. Goldenberg's total compensation was reviewed
based on the experience he brings to the Company and the salaries paid to Chief
Executive Officers of other biopharmaceutical companies of similar size and
stage of development. As a result of this review, and in light of the Company's
financial condition, Dr. Goldenberg was granted an increase in annual salary to
$265,000 and was granted an option to purchase 100,000 shares of Common Stock
pursuant to the 1992 Option Plan.
Compensation Committee,
WARREN W. ROSENTHAL
RICHARD C. WILLIAMS
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COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth information regarding compensation for
services rendered, in all capacities, awarded or paid to or earned by the Chief
Executive Officer and each of the other Executive Officers of the Company who
received compensation from the Company aggregating at least $100,000 during the
year ended June 30, 1997 (collectively, the "Named Executive Officers").
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
------------------------------------------ ------------
Shares
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND SALARY BONUS COMPENSATION OPTIONS COMPENSATION
PRINCIPLE POSITION YEAR ($)(1) ($) ($) (#)(3) ($)
- ------------------ ---- ------ --- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C>
David M. Goldenberg 1997 251,875 - 105,400(2) 100,000 169,000(4)
Chairman of the Board 1996 221,875 - 105,400(2) 200,000 179,000(4)
Chief Executive Officer 1995 221,875 - 100,000(2) 100,000 93,000(4)
Carl M. Pinsky 1997 201,328 - - 15,000 -
Vice President 1996 187,413 - - 30,000 -
Medical Affairs 1995 187,413 - - 175,000(5) -
Hans J. Hansen 1997 166,170 - - 15,000 -
Vice President, 1996 159,851 - - 55,000 -
Research and 1995 155,134 - - 165,000(5) -
Development
</TABLE>
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(1) Includes contributions by the Company to its 401(k) Retirement Plan on
behalf of the Named Executive Officers.
(2) Includes (i) royalty payments in the amount of $100,000 paid pursuant to
a patent license agreement and an employment agreement and (ii) an
automobile allowance of $5,400 in fiscal 1997 and $5,400 in fiscal 1996
(see "Agreements with Executive Officers").
(3) Represents non-qualified stock options granted pursuant to the 1992
Option Plan. See "Stock Option Plan."
(4) Includes (i) premiums paid on whole life insurance policies maintained
for the benefit of the Goldenberg Family Trust in fiscal 1997, 1996, and
1995, of $144,000, $154,000, and $68,000, respectively, and (ii)
premiums of $25,000 paid each year for life insurance policies
maintained for the sole benefit of Dr. Goldenberg (see "Agreements with
Executive Officers").
(5) Includes an option to purchase 150,000 shares of Common Stock granted
upon termination of an equal number of previously granted options.
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<PAGE>
STOCK OPTION PLAN
All employees of the Company, members of the Company's Board of Directors,
members of the Company's Scientific Advisory Board, if any, and consultants to
the Company are eligible to participate in the 1992 Option Plan. The 1992 Option
Plan is intended to provide incentive to continue employment and dedication of
such persons by enabling them to acquire a proprietary interest in the Company,
and by offering comparable incentives to enable the Company to better attract,
compete for and retain highly qualified employees and advisors. The 1992 Option
Plan is administered by the Compensation Committee of the Board of Directors
(the "Committee"), currently comprised of two non-employee Directors of the
Company. The 1992 Option Plan authorizes the issuance, within ten years from the
date of its adoption, of options covering up to 3,000,000 shares of Common
Stock, subject to adjustment in certain circumstances. During fiscal 1997,
non-qualified stock options to purchase 50,000 shares of Common Stock were
granted to the current non-employee Directors of the Company at a weighted
average exercise price of $11.25 per share.
The following table sets forth certain information as to options granted
pursuant to the 1992 Option Plan to each of the Named Executive Officers during
the fiscal year ended June 30, 1997. All of such options were granted pursuant
to the 1992 Option Plan by the Compensation Committee, are non-qualified stock
options, have an option price equal to the closing market price on the date of
grant and vest over a four-year period at the rate of 25% per year.
<TABLE>
<CAPTION>
OPTION GRANTS DURING FISCAL 1997
INDIVIDUAL GRANTS
-----------------------------------------------
PERCENT OF
TOTAL POTENTIAL REALIZABLE VALUE AT
NUMBER OF OPTIONS ASSUMED ANNUAL RATES OF STOCK
SHARES GRANTED TO PRICE APPRECIATION FOR OPTION
UNDERLYING EMPLOYEES EXERCISE TERM (1)
OPTIONS IN PRICE EXPIRATION --------
NAME GRANTED (#) FISCAL YEAR ($/SHARE) DATE 5%($) 10%($)
- ---- ----------- ----------- --------- ---------- ----- ------
<S> <C> <C> <C> <C> <C> <C>
David M. Goldenberg 100,000 24% $4.75 6/25/07 $298,725 $757,028
Carl M. Pinsky 15,000 4 4.75 6/25/07 44,809 113,554
Hans J. Hansen 15,000 4 4.75 6/25/07 44,809 113,554
</TABLE>
- -----------------
(1) Amounts represent hypothetical gains that could be achieved from the
exercise of the respective options and the subsequent sale of the Common
Stock underlying such options if the options were exercised at the end
of the option term. These gains are based on assumed rates of stock
price appreciation of 5% and 10% compounded annually from the date the
respective options were granted. These rates of appreciation are
mandated by the rules of the Securities and Exchange Commission and do
not represent the Company's estimate or projection of the future Common
Stock price. The exercise price of these options was equal to the
closing market price of the Common Stock on the date of grant.
The following table sets forth information for each of the Named Executive
Officers with respect to the value of options exercised during the fiscal year
ended June 30, 1997 and the value of outstanding and unexercised options held as
of June 30, 1997, based upon the market value of the Common Stock of $4.375 per
share on that date.
10
<PAGE>
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
SHARES SHARES UNDERLYING VALUE OF UNEXERCISED
ACQUIRED UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS AT FISCAL
ON VALUE AT FISCAL YEAR END (#) YEAR END ($)(2)
EXERCISE REALIZED ---------------------- ---------------
NAME (#) ($) (1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- --- ------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
David M. Goldenberg -- $ -- 75,000 300,000 $ 47,000 $112,875
Carl M. Pinsky 12,000 121,500 69,250 125,000 85,719 107,438
Hans J. Hansen -- -- 96,250 138,750 109,363 124,463
</TABLE>
- ---------------
(1) Represents the difference between the closing market price of the Common
Stock on the date of exercise and the exercise price per share of
in-the-money options, multiplied by the number of shares acquired upon
exercise. The calculation does not reflect the effect of any income
taxes which may be due on the value realized.
(2) Represents the difference between the closing market price of the Common
Stock at June 30, 1997 of $4.375 per share and the exercise price per
share of in-the-money options, multiplied by the number of shares which
could be acquired at June 30, 1997.
11
<PAGE>
PERFORMANCE GRAPH
The following graph illustrates a comparison of the cumulative stockholder
return (change in stock price plus reinvested dividends) of the Common Stock
with the Nasdaq Pharmaceutical Stock Index (the "Nasdaq Pharmaceutical Index")
and the Nasdaq Stock Market Index (U.S.) (the "Nasdaq Composite Index"). The
comparisons in the graph are required by the Securities and Exchange Commission
and are not intended to forecast or be indicative of possible performance of the
Common Stock.
[THE FOLLOWING CHART REPRESENTS THE PLOT POINTS OF AN ACTUAL GRAPH.]
<TABLE>
<CAPTION>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG
IMMUNOMEDICS, INC., THE NASDAQ COMPOSITE INDEX AND THE NASDAQ
PHARMACEUTICAL INDEX
--------------------------------------------------------
6/30/92 6/30/93 6/30/94 6/30/95 6/30/96 6/30/97
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Immunomedics 100 95 47 32 125 59
- --------------------------------------------------------------------------------
NASDAQ Composite 100 126 127 169 218 265
- --------------------------------------------------------------------------------
NASDAQ Pharmaceutical 100 87 73 97 142 145
- --------------------------------------------------------------------------------
</TABLE>
This chart above assumes $100 was invested on June 30, 1992 in the Common
Stock, the securities comprising the Nasdaq Pharmaceutical Index and the
securities comprising the Nasdaq Composite Index, with reinvestment of any
dividends.
12
<PAGE>
RETIREMENT PLAN
The Company maintains a retirement plan established in conformity with
Section 401(k) of the Internal Revenue Code. All employees of the Company are
eligible to participate in the retirement plan and may (but are not obligated
to) contribute a percentage of their salary to the retirement plan, subject to
certain limitations. Each year, the Company may contribute to the retirement
plan a percentage of each employee's contribution to the retirement plan, which
does not exceed 5% of the employee's salary. The Company may also make an
additional contribution to the retirement plan. Employee contributions vest
immediately. Company contributions vest 20% after two years from the date of
participation and, thereafter, at the rate of 20% per year for the following
four years. A participant also becomes fully (100%) vested upon death,
retirement at age 65 or becomes disabled while an employee. Benefits are paid
following termination of employment or upon showing of financial hardship. It is
not possible to estimate the benefits that any participant may be entitled to
under the retirement plan since the amount of such benefits will be dependent
upon, among other things, future contributions by the Company, future net income
earned by the contributions and forfeitures on future terminations of
employment. In each of the last three fiscal years, the Company has not
contributed to the retirement plan in excess of $1,875 per year for any officer
of the Company.
AGREEMENTS WITH EXECUTIVE OFFICERS
The Company has not entered into any compensatory arrangement pursuant to
which any Executive Officer of the Company will receive payments from the
Company as a result of the Executive Officer's resignation, retirement or
termination of employment or as a result of a change in control of the Company,
except as set forth below.
AMENDED AND RESTATED EMPLOYMENT AGREEMENT WITH DR. GOLDENBERG
On November 1, 1993, the Company and Dr. Goldenberg entered into a
five-year employment agreement (the "Agreement"), with an additional one-year
assured renewal and thereafter automatically renewable for additional one-year
periods unless terminated by either party as provided in the Agreement. Dr.
Goldenberg will continue to serve as the Company's Chairman and will receive an
annual base salary of not less than $220,000, subject to increases as determined
by the Board of Directors. The Board of Directors increased Dr. Goldenberg's
annual base salary to $250,000, effective July 1, 1996, and to $265,000,
effective July 1, 1997.
Pursuant to the Agreement, Dr. Goldenberg is required to devote as much
time as is reasonably necessary to fulfill the duties contemplated by that
Agreement. Additionally, the Agreement provides that Dr. Goldenberg may engage
in other business, general investment and scientific activities provided such
activities do not materially interfere with the performance of any of his
obligations under the Agreement, allowing for those he presently performs for
CMMI, as further discussed below. The Agreement extends the ownership rights of
the Company to, with an obligation to diligently pursue, all ideas, discoveries,
developments and products in the entire medical field, which, at any time during
his past or continuing employment by the Company (but not when performing
services for CMMI), Dr. Goldenberg has made or conceived or hereafter makes or
conceives, or the making or conception of which he has materially contributed to
or hereafter contributes to, all as defined in the Agreement (collectively
"Goldenberg Discoveries").
13
<PAGE>
Further, pursuant to the Agreement, Dr. Goldenberg will receive incentive
compensation of 0.5% on the first $75,000,000 of all defined Annual Net Revenue
of the Company and 0.25% on all such Annual Net Revenue in excess thereof
(collectively "Revenue Incentive Compensation"). Annual Net Revenue includes the
proceeds of certain dispositions of assets or interests therein (other than
defined Undeveloped Assets), including defined Royalties, certain equivalents
thereof and, to the extent approved by the Board, non-royalty license fees.
Revenue Incentive Compensation will be paid with respect to the period of Dr.
Goldenberg's employment, and two years thereafter, unless he unilaterally
terminates his employment without cause or he is terminated by the Company for
cause. With respect to the period that Dr. Goldenberg is entitled to receive
Revenue Incentive Compensation on any given products, it will be in lieu of any
other percentage compensation based on sales or revenue due him with respect to
such products under this Agreement or the existing License Agreement between the
Company and Dr. Goldenberg (described below). With respect to any periods that
Dr. Goldenberg is not receiving such Revenue Incentive Compensation for any
products covered by patented Goldenberg Discoveries or by certain defined Prior
Inventions of Dr. Goldenberg, he will receive 0.5% on cumulative annual net
sales of, and royalties, certain equivalents thereof, and, to the extent
approved by the Board, other consideration received by, the Company for such
products, (collectively, "Annual Net Revenues"), up to a cumulative annual
aggregate of $75,000,000 and 0.25% on any cumulative Annual Net Revenue in
excess of $75,000,000 (collectively "Incentive Payments"). A $100,000 annual
minimum payment will be paid in the aggregate against all Revenue Incentive
Compensation and Incentive Payments and any payments under the License Agreement
(discussed below).
Dr. Goldenberg will also receive a percent, not less than 20%, to be
determined by the Board, of net consideration (including license fees) which the
Company receives for any disposition, by sale, license or otherwise (discussions
directed to which commence during the term of his employment plus two years) of
any defined Undeveloped Assets of the Company which are not budgeted as part of
the Company's strategic plan.
Under the Agreement, Dr. Goldenberg is not entitled to any incentive
compensation with respect to any products, technologies or businesses acquired
from third parties for a total consideration in excess of $5,000,000, unless the
Company had made a material contribution to the invention or development of such
products, technologies or businesses prior to the time of acquisition. Except as
affected by a defined Change in Control or otherwise approved by the Board of
Directors, Dr. Goldenberg would also not be entitled to any incentive
compensation based on defined Annual Net Revenue of the Company or any Incentive
Payments with respect to any time during his term of employment (plus two years,
unless employment is terminated by mutual agreement or by Dr. Goldenberg's death
or permanent disability) that he is not the direct or beneficial owner of shares
of the Company's voting stock with an aggregate market value of at least twenty
times his defined annual cash compensation.
LICENSE AGREEMENT WITH DR. GOLDENBERG
Pursuant to a License Agreement between the Company and Dr. Goldenberg,
Dr. Goldenberg licensed to the Company certain patent applications owned by him
at the time of the Company's formation in exchange for a royalty in the amount
of 0.5% of the first $20,000,000 of annual net sales of all products covered by
any of such patents and 0.25% of annual net sales of such products in excess of
$20,000,000. As discussed above, the Agreement with Dr. Goldenberg extends the
ownership rights of the Company to the Goldenberg Discoveries.
14
<PAGE>
LIFE INSURANCE FOR DR. GOLDENBERG
The Company has also agreed with Dr. Goldenberg to maintain in effect for
his benefit a $2,000,000 whole life insurance policy. If Dr. Goldenberg retires
from the Company on or after his agreed retirement (age 62), or if his
employment ends because of permanent disability, the Company must pay all then
outstanding loans, if any, made under such policy, and assign such policy to Dr.
Goldenberg in consideration of the services previously rendered by Dr.
Goldenberg to the Company. If the employment of Dr. Goldenberg ends for any
other reason, except for cause, Dr. Goldenberg has the option to purchase such
policy for a price mutually agreed upon by him and the Board of Directors, but
not to exceed the cash value thereof less any outstanding policy loans, or he
may purchase such policy at its full cash value, less any outstanding loans,
with the purchase price to the paid out of the proceeds of the policy or any
earlier payment or withdrawal of all or any portion of its net cash value. The
Company also currently maintains $4,000,000 of key man life insurance on Dr.
Goldenberg for the benefit of the Company.
A trust created by Dr. Goldenberg has purchased a $10,000,000 whole life
policy on his life. The policy provides funds which may be used to assist Dr.
Goldenberg's estate in settling estate tax obligations and thus potentially
reducing the number of shares of the Common Stock the estate may be required to
sell over a short period of time to raise funds to satisfy such tax obligations.
This policy was purchased in September 1994 to replace three policies
aggregating $20,000,000 which had been in effect since November 1991 covering
the second-to-die of Dr. Goldenberg and his then wife. Upon cancellation of
these three policies, the cash surrender value of the policies was reinvested
into the new policy. During what is estimated to be a 15-year period, the
Company is obligated to pay $143,000 per year towards premiums, compared to an
equivalent $250,000 commitment under the previous policies, in addition to
amounts required to be paid by Dr. Goldenberg. The Company has an interest in
this new policy up to the cumulative amount of premium payments made by it under
the old and new policies, which, through September 29, 1997, amounted to
$1,124,000. If Dr. Goldenberg's employment terminates, and the policy is not
maintained, the Company would receive payment of only its invested cumulative
premiums, up to the amount of cash surrender value in the policy.
THE CENTER FOR MOLECULAR MEDICINE AND IMMUNOLOGY
The Center for Molecular Medicine and Immunology ("CMMI") is a
not-for-profit corporation, currently located in Belleville, New Jersey. CMMI
was established in 1983 by Dr. Goldenberg and is devoted primarily to cancer
research. Dr. Goldenberg was the original founder of, and currently serves as
President and a member of the Board of Trustees of CMMI. Dr. Goldenberg spends
substantially more of his working time for CMMI than for the Company. Certain
consultants to the Company have employment relationships with CMMI and Drs. Carl
Pinsky and Hans Hansen, officers of the Company, are Adjunct Members at CMMI.
Despite these relationships, CMMI is independent of the Company and its
management and fiscal operations are the responsibility of its Board of
Trustees.
The Company's product development has involved, to varying degrees, CMMI
for the performance of certain basic research and patient evaluations. CMMI
performs pilot and pre-clinical trials in product areas of importance to the
Company. In addition, CMMI conducts basic research and patient evaluations in a
number of areas of potential interest to the Company the results of which are
made available to the Company pursuant to a collaborative research and license
agreement (the "Research Agreement"), dated as of January 21, 1997. If such
research results in the development of a potential product, the Company has a
right of first negotiation to obtain a worldwide exclusive license to produce
and market the product (including the right to grant sublicenses), unless
developed by CMMI under a research and development contract with a third party.
In consideration for such rights, the Company has agreed to pay CMMI an annual
license fee of $200,000. If the Company exercises this right with respect to a
product, it must pay to CMMI a royalty, to be negotiated in good faith at the
time the license is obtained. To date, no products have been licensed from CMMI.
15
<PAGE>
The potential for conflict of interest exists in connection with the
relationship between the Company and CMMI, and the provisions of the agreement
between the Company and CMMI have been designed to prevent such conflicts of
interest. The Company and CMMI have agreed that neither will have any right,
title or interest in or to the research grants, contracts or other agreements
obtained by the other party. The decision as to whether a potential product has
reached the stage of development such that it must be offered by CMMI to the
Company is made by the executive committee of the Board of Trustees of CMMI, and
Dr. Goldenberg has agreed not to participate in the determination of any such
issue. In addition, the decision by the Company as to whether or not to exercise
its right of first negotiation or release any potential product offered by CMMI
is determined by the majority vote of the Board of Directors (or a subcommittee
thereof), and, again, Dr. Goldenberg has also agreed not to participate in the
determination of any such issue.
The Company also has made grants, totalling $400,000 since July 1, 1996,
to CMMI in support of the research and clinical work being performed at CMMI,
such grants to be expended in a manner deemed appropriate by the Board of
Trustees of CMMI. The Company also supplies CMMI with laboratory materials and
supplies at cost or, if provided in connection with collaborative research
efforts, at no charge to CMMI and has donated to CMMI surplus equipment no
longer used by the Company.
SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected KPMG Peat Marwick LLP as the
independent auditors to audit the books and accounts of the Company for the
current fiscal year. KPMG Peat Marwick LLP has served as such independent
auditors since fiscal year 1992. One or more representatives of KPMG Peat
Marwick LLP will be present at the Annual Meeting, will have an opportunity to
make a statement if they desire to do so and will respond to appropriate
questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR APPROVAL
OF THE SELECTION OF KPMG PEAT MARWICK LLP AS THE COMPANY'S INDEPENDENT AUDITORS.
STOCKHOLDERS PROPOSALS FOR NEXT ANNUAL MEETING
Stockholders of the Company wishing to include proposals in the proxy
material relating to the 1998 Annual Meeting of Stockholders of the Company must
submit the same in writing so as to be received at the principal executive
office of the Company (to the attention of the Secretary) on or before June 12,
1998 for such proposal to be considered for inclusion in the proxy statement for
such meeting. Such proposals must also meet the other requirements of the rules
of the Securities and Exchange Commission relating to stockholder proposals.
The Governance and Nominating Committee will consider nominees recommended
by stockholders of the Company for election as a Director at the 1998 Annual
Meeting of Stockholders of the Company, provided that any such recommendation is
submitted in writing, not less than 60 nor more than 120 days before the
anniversary date of the 1997 Annual Meeting of Stockholders, to the Committee,
c/o the Secretary of the Company, at the Company's principal executive offices,
accompanied by a description of the proposed nominee's qualifications and other
relevant biographical information and an indication of the consent of the
proposed nominee to serve. In recommending candidates, the Governance and
Nominating Committee seeks individuals who possess broad training and experience
in business, finance, law, government, medicine, immunology, molecular biology,
management or administration and considers factors such as personal attributes,
geographic location and special expertise complementary to the background and
experience of the Board as a whole.
16
<PAGE>
OTHER MATTERS
The Board of Directors does not know of any other business to be presented
for consideration at the Annual Meeting. If other matters properly come before
the Annual Meeting, the persons named in the accompanying proxy intend to vote
thereon in accordance with their best judgment.
The Company will furnish, without charge, to each person whose proxy is
being solicited, upon written request, a copy of its Annual Report on Form 10-K
for the fiscal year ended June 30, 1997, as filed with the Securities and
Exchange Commission, including the financial statements, notes to the financial
statements and the financial schedules contained therein. Copies of any exhibits
thereto also will be furnished upon the payment of a reasonable duplicating
charge. Written requests for copies of any such materials should be directed to
Immunomedics, Inc., 300 American Road, Morris Plains, New Jersey 07950;
Attention - Investor Relations.
SOLICITATION AND EXPENSES
The Company will bear the cost of the Annual Meeting and the cost of
soliciting proxies, including the cost of mailing the proxy materials. In
addition to solicitation by mail, Directors, officers and regular employees of
the Company (who will not be specifically compensated for such services) may
solicit proxies by telephone or otherwise. Arrangements will be made with
brokerage houses and other custodians, nominees and fiduciaries to forward
proxies and proxy material to their principals and the Company will reimburse
them for their expenses.
By Order of the Board of Directors,
David M. Goldenberg,
CHAIRMAN OF THE BOARD
October 7, 1997
17
<PAGE>
IMMUNOMEDICS, INC.
PROXY--ANNUAL MEETING OF STOCKHOLDERS--NOVEMBER 5, 1997
(SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS)
Know All Men By These Presents, that the undersigned stockholder of
Immunomedics, Inc. hereby constitutes and appoints David M. Goldenberg and
Phyllis Parker, and each and either of them, the attorneys and proxies of the
undersigned, with full power of substitution and revocation to vote for and in
the name, place and stead of the undersigned at the Annual Meeting of
Stockholders of Immunomedics, Inc. to be held at the offices of Immunomedics,
Inc., 300 American Road, Morris Plains, New Jersey on Wednesday, November 5,
1997, at 10:00 A.M., and at any adjournments thereof, the number of votes the
undersigned would be entitled to cast if present:
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE ELECTION OF DIRECTORS AND FOR THE RATIFICATION OF KPMG PEAT
MARWICK AS THE INDEPENDENT AUDITORS.
(Continued and To Be Signed on Reverse Side)
1
<PAGE>
<TABLE>
<CAPTION>
[ X ] Please mark you
votes as in this
example
FOR ALL NOMINEES WITHHOLD
EXCEPT AS AUTHORITY
INDICATED BELOW FOR ALL NOMINEES
<S> <C> <C> <C> <C> <C> <C> <C>
Nominees: W. Robert Friedman, Jr., FOR AGAINST ABSTAIN
David M. Goldenberg, 2. Proposal to ratify [ ] [ ] [ ]
1. Election of [ ] [ ] Marvin E. Jaffe, KPMG Peat Marwick as the
Directors Richard R. Pivirotto, independent auditors
Warren W. Rosenthal, for the fiscal year
For, except vote withheld from the following nominees: Richard C. Williams ending June 30, 1998
- ----------------------------------------------------- 3. In their discretion, upon such other
matters as may properly come before the
meeting.
Both of said attorneys and proxies, or
their substitutes (or if only one, that
one) at said meeting, or any adjournments
thereof, may exercise all of the powers
hereby given. Any proxy heretofore given is
hereby revoked.
Receipt is acknowledged of the notice of
Annual Meeting of Stockholders, the Proxy
Statement accompanying said Notice and the
Annual Report to Stockholders for the
fiscal year ended June 30, 1997.
In Witness Whereof, the undersigned has
signed this Proxy.
I will attend the Annual Meeting. [ ]
I will NOT attend the Annual Meeting. [ ]
Signature(s):____________________________ Date_______________ Signature(s):____________________________ Date_______________
NOTE:
Signature(s) of stockholder(s) should correspond exactly with the names(s) shown hereon. If stock is jointly held, both holders
should sign. Attorneys, executors, administrators, trustees, guardians or others signing in a representative capacity should give
their full titles. Proxies executed in the name of a corporation should be signed on behalf of the corporation by its president or
other authorized officer. This Proxy, properly filled in, dated and signed, should be returned promptly in the enclosed envelope.
</TABLE>
