SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Amendment No. 2)
Under the Securities Exchange Act of 1934
Endorex Corporation (f/k/a ImmunoTherapeutics, Inc.)
(Name of Issuer)
Common Stock, par value $.001 per share
(Title of Class of Securities)
452916 40 6
(CUSIP Number)
Paramount Capital Asset Management, Inc.
c/o Lindsay A. Rosenwald, M.D.
787 Seventh Avenue
New York, NY 10019
(212) 554-4300
with a copy to:
David R. Walner, Esq.
Paramount Capital Asset Management, Inc.
787 Seventh Avenue
New York, NY 10019
(212) 554-4372
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
October 28, 1996
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on
Schedule 13G to report the acquisition which is the
subject of this Statement because of Rule 13d-1(b)(3) or
(4), check the following:
_
Check the following box if a fee is being paid with this
Statement:
_
SCHEDULE 13D
CUSIP NO. 452916 40 6
1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Paramount Capital Asset Management, Inc.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) _
(b) _
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO (see Item 3 below)
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) _
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
None
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY 9,237,000
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING None
PERSON
WITH 10 SHARED DISPOSITIVE POWER
9,237,000
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
9,237,000
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* _
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
56.7%
14 TYPE OF REPORTING PERSON*
CO
SCHEDULE 13D
CUSIP NO. 452916 40 6
1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Aries Domestic Fund, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) _
(b) _
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO (see Item 3)
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) _
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
None
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY 2,323,500
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING None
PERSON
WITH 10 SHARED DISPOSITIVE POWER
2,323,500
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,323,500
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* _
13 14.3%
14 TYPE OF REPORTING PERSON*
PN
SCHEDULE 13D
CUSIP NO. 452916 40 6
1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
The Aries Trust
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) _
(b) _
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO (see Item 3)
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) _
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Cayman Islands
7 SOLE VOTING POWER
None
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY 6,913,500
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING None
PERSON
WITH 10 SHARED DISPOSITIVE POWER
6,913,500
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,913,500
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* _
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
42.4%
14 TYPE OF REPORTING PERSON*
OO (see Item 2)
SCHEDULE 13D
CUSIP NO. 452916 40 6
1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Lindsay A. Rosenwald, M.D.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) _
(b) _
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO (see Item 3)
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) _
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
None
NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY 9,237,000
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING None
PERSON
WITH 10 SHARED DISPOSITIVE POWER
9,237,000
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
9,237,000
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* _
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
56.7
14 TYPE OF REPORTING PERSON*
IN
Item 1. Security and Issuer.
(a) Common Stock, $.001 par value ("Shares")
Endorex Corporation (f/k/a ImmunoTherapeutics, Inc.) (the "Issuer")
3233 15th Street South
Fargo, ND 58104
(701) 232-9575
Item 2. Identity and Background.
Names of Persons Filing:
(a) This statement is filed on behalf of Paramount Capital Asset
Management, Inc. ("Paramount Capital "), Aries Domestic Fund, L.P.
("Aries Domestic"), The Aries Trust ("Aries Trust") and Lindsay A.
Rosenwald, M.D. (collectively, "Reporting Parties"). See attached
Exhibit A which is a copy of their agreement in writing to file
this statement on behalf of each of them.
(b) Paramount Capital's, Aries Domestic's and Dr. Rosenwald's business
address is 787 Seventh Avenue, New York, New York, 10019. The
business address for Aries Trust is c/o MeesPierson (Cayman)
Limited, P.O. Box 2003, British American Centre, Phase 3, Dr. Roy's
Drive, George Town, Grand Cayman.
(c) Dr. Rosenwald is an investment banker, venture capitalist and fund
manager and is the sole shareholder of Paramount Capital,(1) a
Subchapter S corporation incorporated in Delaware. Paramount
Capital is the General Partner of Aries Domestic,(2) a limited
partnership incorporated in Delaware. Paramount Capital is the
Investment Manager to Aries Trust,(3) a Cayman Islands Trust.
(d) Dr. Rosenwald, Paramount Capital, Aries Domestic and Aries Trust
and their respective officers, directors, general partners,
investment managers, or trustees have not, during the five years
prior to the date hereof, been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors).
(e) Dr. Rosenwald, Paramount Capital, Aries Domestic and Aries Trust
and their respective officers, directors, general partners,
investment managers, or trustees have not been, during the five
years prior to the date hereof, parties to a civil proceeding of a
judicial or administrative body of competent jurisdiction, as a
result of which such person was or is subject to a judgment, decree
or final order enjoining future violations of, or prohibiting or
mandating activities subject to, Federal or State securities laws
or finding any violation with respect to such laws.
(f) Dr. Rosenwald is a citizen of the United States.
---------------------
1 Please see attached Exhibit B indicating the executive
officers and directors of Paramount Capital and providing
information called for by Items 2-6 of this statement as to
said officers and directors. Exhibit B is herein
incorporated by reference.
2 Please see attached Exhibit C indicating the general partner
of Aries Domestic and the general partner's executive
officers and directors and providing information called for
by Items 2-6 of this statement as to said general partners,
officers and directors. Exhibit C is herein incorporated by
reference.
3 Please see attached Exhibit D indicating the investment
manager of the Aries Trust and the investment manager's
executive officers and directors and providing information
called for by Items 2-6 of this statement as to said
investment manager and officers and directors. Exhibit D is
herein incorporated by reference.
Item 3. Source and Amount of Funds or Other Consideration.
As previously reported in the original statement on Schedule 13-D
(the "Original Statement") filed by the Reporting Parties in
connection with their initial acquisition of shares of the Issuer
on June 13, 1996, Aries Domestic used its general funds to effect
its initial purchase of 1,000,000 shares of the Issuer for an
approximate purchase price of $100,000 from Dominion Resources,
Inc., a Delaware corporation ("Dominion") and Aries Trust used its
general funds to effect it initial purchase of 3,000,000 shares of
the Issuer for an approximate purchase price of $300,000 from
Dominion. As previously reported in Amendment No. 1 to the
Original Statement on Schedule 13-D ( Amendment No. 1"), on June
26, 1996, Aries Domestic used its general funds to effect an
additional purchase of 1,250,000 newly issued shares of the Issuer
directly from the Issuer for an approximate purchase price of
$250,000 and Aries Trust used its general funds to effect an
additional purchase of 3,750,000 newly issued shares of the Issuer
directly from the Issuer for an approximate purchase price of
$750,000 from Dominion. Since the date of Amendment No. 1, Aries
Domestic and the Aries Trust have used their general funds to
effect certain purchases of the securities of the issuer in open
market transactions in an amount of approximately $96,543 and
$212,759 respectively in the aggregate.
Item 4. Purpose of Transaction.
The Reporting Parties first acquired shares of Common Stock of the
Issuer from Dominion Resources, Inc., a Delaware corporation and a
stockholder of the Issuer, pursuant to a Stock Purchase Agreement
(the "Stock Purchase Agreement") dated June 13, 1996, a copy of
which is attached as Exhibit E and the terms of which are
incorporated herein by reference, as an investment in the Issuer.
Amongst other things, the Stock Purchase Agreement entitles the
Aries Trust and Aries Domestic to designate a representative to sit
on the Issuer's Board of Directors and requires the consent of the
Aries Trust and Aries Domestic for certain extraordinary corporate
transactions. Mr. Steve Kanzer was appointed to the Issuer's Board
of Directors as the Aries Trust and Aries Domestic Board designee.
Mr. Kanzer is an employee of certain affiliates of the Reporting
Persons.
On June 26, 1996, Aries Domestic and the Aries Trust entered into a
definitive stock purchase agreement (the "June 26 Agreement") with
the Issuer pursuant to which the Reporting Parties acquired
ownership of an additional 5,000,000 shares (the Additional
Shares ) of Common Stock of the Issuer. Pursuant to the June 26
Agreement, the Additional Shares were purchased in the amount of
3,750,000 shares by the Aries Trust and 1,250,000 shares by Aries
Domestic. A copy of the June 26 Agreement relating to the purchase
of the Additional Shares is attached as Exhibit F hereto and is
incorporated by reference herein.
In connection with the investment by the Aries Trust and Aries
Domestic, the Issuer's Board of Directors redeemed the Shareholder
Rights Plan dated September 23, 1994 by and between the Issuer and
American Stock Transfer & Trust Company, as Rights Agent. In
addition, pursuant to a letter agreement dated June 25, 1996 (the
"Vosika Agreement") the Company and Dr. Gerald Vosika, the Issuer's
Chairman and President, amended Dr. Vosika's prior employment
agreement with the Issuer which such amendment permitted the Issuer
to hire a Chief Executive Officer without giving rise to any
termination or severance payment rights under Dr. Vosika's prior
employment or option agreements. The Vosika Agreement contains
additional provisions including, amongst other things, a waiver by
Dr. Vosika of any termination rights or severance payments as a
result of the acquisition of shares of the Issuer by Aries Trust
and Aries Domestic and elimination of certain change of control
provisions from Dr. Vosika's prior employment and option
agreements. A copy of the Vosika Agreement is attached as Exhibit
G hereto and is incorporated by reference herein.
Since making their initial investment, the Reporting Parties have
had ongoing discussions with the Issuer's management and certain
members of the Board concerning the Company s business and
financial and strategic plans. In August, 1996, Mr. Michael Rosen
joined the Company as President and Chief Executive Officer.
The Reporting Parties, may from time to time acquire, or dispose
of, Common Stock and/or other securities of the Issuer if and when
they deem it appropriate. The Reporting Parties may formulate
other purposes, plans or proposals relating to any of such
securities of the Issuer to the extent deemed advisable in light of
market conditions, investment policies and other factors.
Except as indicated in this Schedule 13D, the Reporting Parties
currently have no plans or proposals that relate to or would result
in any of the matters described in subparagraphs (a) through (j) of
Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) As of November 13, 1996, Dr. Rosenwald and Paramount Capital,
through acquisition of the shares by the Aries Trust and Aries
Domestic, beneficially owned 9,237,000 shares or 56.7% of the
Issuer's securities and Aries Domestic and the Aries Trust
beneficially owned as follows:
Amount Owned
------------
Aries Domestic 2,323,500 Shares
Aries Trus 6,913,500 Shares
(b) Dr. Rosenwald and Paramount Capital share the power to vote or
to direct the vote, to dispose or to direct the disposition of
those shares owned by each of Aries Domestic and Aries Trust.
(c) The following purchases were made by Aries Domestic in the
open market in the sixty days prior to November 13, 1996:
Date No. of Shares Market Price
---- ------------- ------------
10/1/96 4,500 1.531
10/09/96 6,000 1.250
10/23/96 4,500 1.063
10/24/96 4,500 1.031
10/25/96 1,500 1.031
10/28/96 4,500 1.063
10/29/96 4,500 1.000
10/31/96 15,000 1.106
The following purchases were made by Aries Trust in the open
market in the sixty days prior to November 13, 1996:
Date No. of Shares Market Price
---- ------------- ------------
10/1/96 9,500 1.531
10/09/96 14,000 1.250
10/23/96 10,500 1.063
10/24/96 10,500 1.031
10/25/96 3,500 1.031
10/28/96 10,500 1.063
10/29/96 10,500 1.000
10/31/96 35,000 1.106
Other than as set forth herein the Reporting Parties have not
engaged in any transactions in the Common Stock of the Issuer
during the past 60 days.
(d) & (e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships
with respect to Securities of the Issuer
Paramount Capital is the investment manager of the Aries Trust and
the General Partner of Aries Domestic and in such capacities has
the authority to make certain investment decisions on behalf of
such entities, including decisions relating to the securities of
the Issuer. In connection with its investment management duties,
Paramount Capital receives certain management fees and performance
allocations from the Aries Trust and Aries Domestic. Dr. Rosenwald
is the sole shareholder of Paramount Capital. Pursuant to its
rights under the Stock Purchase Agreement, the Aries Trust and
Aries Domestic appointed Mr. Steve Kanzer to the Issuer's Board of
Director as their designated Board representative. In
consideration for his services as a Director, Mr. Kanzer was
granted options to purchase 200,000 shares of the Issuer's Common
Stock at a purchase price of $.20 per share. See also Item 4 and
Exhibits E, F and G to this Schedule 13-D, all of which are hereby
incorporated by reference.
Except as indicated in this 13D and exhibits, there is no contract,
arrangement, understanding or relationship between the Reporting
Parties and any other person, with respect to any securities of the
Issuer.
Item 7. Material to be Filed as Exhibits:
Exhibit A - Copy of an Agreement between Dr. Rosenwald, Paramount Capital,
Aries Domestic and Aries Trust to file this Statement on
Schedule 13D on behalf of each of them.
Exhibit B - List of executive officers and directors of Paramount Capital
and information called for by Items 2-6 of this statement
relating to said officers and directors.
Exhibit C - List of executive officers and directors of Aries Domestic and
information called for by Items 2-6 of this statement relating
to said officers and directors.
Exhibit D - List of executive officers and directors of Aries Trust and
information called for by Items 2-6 of this statement relating
to said officers and directors.
Exhibit E - Stock Purchase Agreement dated as of June 13, 1996 by and
among ImmunoTherapeutics, Inc., Dominion Resources Inc., the
Aries Fund, a Series of the Aries Trust and The Aries Domestic
Fund, L.P. (Incorporated by reference to Exhibit E of the
Original Statement on Schedule 13D filed by the Reporting
Parties)
Exhibit F - Stock Purchase Agreement dated as of June 26, 1996 by and
among ImmunoTherapeutics, Inc., the Aries Fund, a Series of
the Aries Trust and The Aries Domestic Fund, L.P.
(Incorporated by reference to Exhibit G of Amendment No. 1 to
Schedule 13D filed by the Reporting Parties).
Exhibit G - Letter Agreement dated June 25, 1996 by and between
ImmunoTherapeutics Inc. and Dr. Gerald Vosika (Incorporated by
reference to Exhibit H of Amendment No. 1 to Schedule 13D
filed by the Reporting Parties).
SIGNATURES
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
PARAMOUNT CAPITAL ASSET MANAGEMENT, INC.
Dated: November 13, 1996
New York, NY By /s/ Lindsay A. Rosenwald, M.D.
Lindsay A. Rosenwald, M.D.
President
ARIES DOMESTIC FUND, L.P.
By Paramount Capital Asset Management, Inc.
General Partner
Dated: November 13, 1996
New York, NY By /s/ Lindsay A. Rosenwald, M.D.
Lindsay A. Rosenwald, M.D.
President
THE ARIES TRUST
By Paramount Capital Asset Management, Inc.
Investment Manager
Dated: November 13, 1996
New York, NY By /s/ Lindsay A. Rosenwald, M.D.
Lindsay A. Rosenwald, M.D.
President
Dated: November 13, 1996
New York, NY By /s/ Lindsay A. Rosenwald, M.D.
Lindsay A. Rosenwald, M.D.
EXHIBIT A
AGREEMENT
JOINT FILING OF SCHEDULE 13D
The undersigned hereby agrees to jointly prepare and file with
regulatory authorities a Schedule 13D and any future amendments thereto
reporting each of the undersigned's ownership of securities of
ImmunoTherapeutics, Inc. and hereby affirm that such Schedule 13D is being
filed on behalf of each of the undersigned.
PARAMOUNT CAPITAL ASSET MANAGEMENT, INC.
Dated: November 13, 1996
New York, NY By /s/ Lindsay A. Rosenwald, M.D.
Lindsay A. Rosenwald, M.D.
President
ARIES DOMESTIC FUND, L.P.
By Paramount Capital Asset Management, Inc.
General Partner
Dated: November 13, 1996
New York, NY By /s/ Lindsay A. Rosenwald, M.D.
Lindsay A. Rosenwald, M.D.
President
THE ARIES TRUST
By Paramount Capital Asset Management, Inc.
Investment Manager
Dated: November 13, 1996
New York, NY By /s/ Lindsay A. Rosenwald, M.D.
Lindsay A. Rosenwald, M.D.
President
Dated: November 13, 1996
New York, NY By /s/ Lindsay A. Rosenwald, M.D.
Lindsay A. Rosenwald, M.D.
EXHIBIT B
The name and principal occupation or employment, which in each instance
is with Paramount Capital Asset Management, Inc. ("Paramount Capital")
located at 787 Seventh Avenue, New York, New York, 10019, of each executive
officer and director of Paramount Capital is as follows:
PRINCIPAL OCCUPATION
NAME OR EMPLOYMENT
Lindsay A. Rosenwald, M.D. Chairman of the Board, President of
Paramount Capital Asset Management,
Inc., Paramount Capital Investments
LLC and Paramount Capital, Inc.
Peter Morgan Kash Director of Paramount Capital Asset
Management, Inc., Senior Managing
Director, Paramount Capital, Inc.
Dr. Yuichi Iwaki Director of Paramount Capital Asset
Management, Inc., Professor, University
of Southern California School of Medicine
Item 2.
During the five years prior to the date hereof, none of the above
persons (to the best of Paramount Capital's knowledge) was convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
was a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction, as a result of which such person was or is subject to
a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, Federal or State securities
laws or finding any violation with respect to such laws.
Items 3-6.
Please refer to Items 3-6 herein reporting the beneficial ownership.
EXHIBIT C
The name and principal occupation or employment, which is located at 787
Seventh Avenue, New York, New York, 10019, of the General Partner of Aries
Domestic is as follows:
PRINCIPAL OCCUPATION
NAME OR EMPLOYMENT
Paramount Capital Asset Management, Inc. General Partner; Investment Manager
Exhibit B is hereby incorporated by reference.
Item 2.
During the five years prior to the date hereof, the above person (to the
best of Aries Domestic's knowledge) has not been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or was a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction, as a result of which such person was or is subject to a
judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, Federal or State securities
laws or finding any violation with respect to such laws.
Items 3-6.
Please refer to Items 3-6 herein reporting the beneficial ownership.
EXHIBIT D
The name and principal occupation or employment, which in each instance
is with The Aries Trust ("Aries Trust") located at 787 Seventh Avenue, New
York, New York, 10019, of each executive officer and director of Aries Trust
is as follows:
PRINCIPAL OCCUPATION
NAME OR EMPLOYMENT
Paramount Capital Asset Management, Inc. Investment Manager
MeesPierson (Cayman) Limited Trustee
Exhibit B is hereby incorporated by reference.
Item 2.
During the five years prior to the date hereof, neither of the above
persons (to the best of Aries Trust's knowledge) have been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
was a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction, as a result of which such person was or is subject to
a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, Federal or State securities
laws or finding any violation with respect to such laws.
Items 3-6.
Please refer to Items 3-6 herein reporting the beneficial ownership.
