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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. __________)
[X] Filed by Registrant
[ ] Filed by Party other than the Registrant
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or
ss.240.14a-12
IMMUNOTHERAPEUTICS, INC.
(Name of Registrant as Specified in Its Charter)
Not Applicable
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3)
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
computer 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:
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IMMUNOTHERAPEUTICS, INC.
3233 FIFTEENTH STREET SOUTH
FARGO, NORTH DAKOTA 58104
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
July 15, 1996
Notice is hereby given that the Annual Meeting of Shareholders of
ImmunoTherapeutics, Inc. (the "Company") will be held at the Radisson Hotel, 201
North Fifth Street, Fargo, North Dakota on Monday, July 15, 1996 at 10:00 A.M.
for the following purposes:
1. To elect three directors to hold office until the next
Annual Meeting of Shareholders in 1997 and until their respective
successors are elected and qualified;
2. To consider and vote on a proposal to change the name of
the Company to Endorex Corp.;
3. To transact such other business as may properly come
before the meeting or any adjournment thereof.
Information with respect to the above is set forth in the Proxy
Statement which accompanies this Notice. Only shareholders of record at the
close of business on June 10, 1996 are entitled to notice of and to vote at the
meeting.
We hope that all of our shareholders who can conveniently do so will
attend the meeting. Shareholders who do not expect to be able to attend the
meeting are requested to mark, date and sign the enclosed proxy and return the
same in the enclosed addressed envelope which requires no postage and is
intended for your convenience.
By Order of the Board of Directors,
James W. Burrow, Secretary
Dated: June 17, 1996
<PAGE>
IMMUNOTHERAPEUTICS, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
The enclosed proxy is solicited by the Board of Directors of
ImmunoTherapeutics, Inc., a Delaware corporation (the "Company"), from the
holders of shares of Common Stock, par value $.001 per share, to be voted at the
Annual Meeting of Shareholders (the "Meeting") to be held at the Radisson Hotel,
201 North Fifth Street, Fargo, North Dakota on Monday July 15, 1996 at 10:00
A.M. and at any adjournments thereof.
The only business which the Board of Directors intends to present or
knows that others will present at the Meeting is (i) the election of three
Directors of the Company to hold office until the next Annual Meeting of
Shareholders in 1997 and until their successors have been elected and qualified,
and (ii) to consider and vote on a proposal to change the name of the Company to
Endorex Corp. Management does not know of any other business to be brought
before the Meeting but it is intended that as to any other business, a vote may
be cast pursuant to the proxy in accordance with the judgment of the person or
persons acting thereunder. Any shareholder giving a proxy has the power to
revoke it at any time before the proxy is voted by revoking it in writing, by
executing a later dated proxy or appearing at the Meeting and voting in person.
Any writing revoking a proxy should be addressed to Mr. James W. Burrow,
Secretary of the Company at the address set forth below.
Only shareholders of record as of the close of business on June 10,
1996 are entitled to notice of and to vote at the Meeting or any adjournments
thereof. On such date, the Company had issued and outstanding voting securities
consisting of 9,122,047 shares of Common Stock, $.001 par value, each of which
shares is entitled to one vote.
The Company's address is 3233 Fifteenth Street South, Fargo, North
Dakota 58104, and its telephone number is (701) 232-9575. This Proxy Statement
and the enclosed Form of Proxy will be mailed to the Company's shareholders on
or about June 17, 1996.
1. ELECTION OF DIRECTORS
At the Meeting, it is proposed to elect three Directors to hold office
until the next Annual Meeting of Shareholders in 1997 and until their respective
successors are elected and qualified. It is intended that, unless otherwise
indicated, the shares of
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Common Stock represented by proxies solicited by the Board of Directors will be
voted for the election as Directors of the three nominees hereinafter named, all
of whom are presently Directors of the Company and, except for Mr. McManus, were
elected at the Annual Meeting of Shareholders held in 1995. If, for any reason,
any of said nominees shall become unavailable for election, which is not now
anticipated, the proxies will be voted for the remainder of those named and may
be voted for a substitute nominee designated by the Board of Directors. All
nominees have indicated that they are willing and able to serve as Directors if
elected and, accordingly, the Board of Directors does not have in mind any
substitute.
The nominees as Director, the age, principal occupation and position
with the Company of each such person and the year in which each first became a
Director are as follows:
Positions and Offices Director
Name Age With the Company Since
Gerald J. Vosika, M.D. 53 Chairman of the Board, 1987
President Scientific
Director and Director
of the Company
Carl Gilbert, Ph.D. 44 Director of the Company 1990
William McManus 40 Director 1996
All of the Company's Directors will serve until the next Annual Meeting of
Shareholders intended to be held in June 1997 and until their successors are
elected and qualified. Officers are to be elected at the annual meeting of the
Board of Directors following the Annual Meeting of Shareholders. Directors of
the Company do not receive any compensation for serving in that capacity however
they are reimbursed for their out-of-pocket expenses in attending meetings.
DR. VOSIKA has been Scientific Director and a Director of the Company,
which he founded, since its inception in February 1985. He was President of the
Company from inception until August 1990 when he was elected Chairman of the
Board. He has been a practicing physician and an investigator of
immunotherapeutic agents for the past 21 years. Dr. Vosika was employed by the
United States Veteran's Administration from July 1980 until May 1987. He was a
part-time employee of the University of North Dakota from July 1980 to March
1993 and a part-time employee of the
2
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United States Veterans Administration from December 1990 to March 1993. Dr.
Vosika devotes his full time to the Company. From 1980 through March 1988, he
was Chief of Hematology for the University of North Dakota and Chief of Oncology
for the Fargo, North Dakota, Veterans Administration Hospital.
DR. CARL GILBERT has been employed by Enzon Corporation since July,
1991. Prior thereto he was employed by the Company from June 1987 to July 1991
and held a variety of research positions, including responsibilities for drug
development, testing production and quality control. He has a Bachelor of
Science degree in biochemistry from the University of Wisconsin, Madison in
1973. He has a Masters degree in biochemistry (1975) and a Ph.D. degree in cell
biology (1983) from the University of Illinois. From 1983 until joining the
Company he was a post-doctoral research associate at Michigan State University.
He has done extensive research on the interaction of tumor cells with natural
killer cells. He was elected to the Board of Directors in December 1990.
MR. MCMANUS has been an attorney-at-law for more than the past five
years. Mr. McManus is also President and a Director of Dominion Resources, Inc.,
a principal shareholder of the Company. Mr. McManus was elected to the Company's
Board of Directors in March 1996 pursuant to an agreement dated March 1, 1996
between the Company and Dominion Resources, Inc. which gave to Dominion
Resources, Inc. the right to designate one person for election to the Company's
Board of Directors.
Except for Mr. McManus, none of the Company's Directors is a Director
of any other corporation which is subject to the periodic reporting requirements
of the Securities Exchange Act of 1934 or is a registered investment company
under the Investment Company Act of 1940.
Executive Officers
The following table sets forth certain information regarding the
executive officers of the Company.
Name Age Principal Occupation
Gerald J. Vosika, M.D. 53 President, Chairman of the
Board, Scientific Director,
Principal Financial Officer
and Director of the Company
The employment background of Dr. Vosika is described above.
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Dr. Vosika will hold office until the next annual meeting of the Board
of Directors following the annual meeting of shareholders unless previously
removed by the Board of Directors.
Compensation of Executive Officers.
The following table sets forth the compensation paid during the
Company's three fiscal years ended January 31, 1996, 1995 and 1994 to the chief
executive officer of the Company. No other executive officer of the Company
received compensation exceeding $100,000 in any of those years.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long term
Compensation
Awards
Name and Other Annual All Other
Principal Position Year(1) Salary Bonus($) Compensation($) Options(#) Compensation
<S> <C> <C> <C> <C> <C> <C>
Gerald Vosika 1996 $213,560 -0- -0- -0- -0-
1995 $197,600 -0- -0- 75,000 -0-
1994 $191,161 -0- $42,829(2) -0- -0-
</TABLE>
(1) During the year ended January 31.
(2) Includes life insurance premiums and related tax adjustment.
Stock Option Holdings
The following table provides information with respect to the above
named executive officer regarding Company options held at the end of the
Company's year ended January 31, 1996 (such officer did not exercise any options
during the most recent fiscal year).
Aggregate Option Exercises in 1996
and Option Values at January 31, 1996
Value of Unexercised
Number of Unexercised In-the-Money
Options at Jan. 31, 1996(#) Options at Jan. 31, 1996($)(1)
Name Exercisable Unexercisable Exercisable Unexercisable
Gerald Vosika 75,000(2) 200,000(2)(3) -0- -0-
(1) Based on the closing sale price of $0.10 on January 26, 1996.
(2) Exercisable at $0.275 per share.
(3) Does not include an option to purchase 2,000,000 shares of common stock at
an exercise price of $.065 per share granted on March 22, 1996.
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No options were granted or exercised during the year ended January 31,
1996. On March 22, 1996, Dr. Vosika was granted a ten-year option to purchase
2,000,000 shares of the Company's Common Stock at an exercise price of $.065 per
share.
Employment Agreements
Dr. Vosika is currently employed by the Company at a salary of $197,600
per year. Under the terms of such agreement, Dr. Vosika is restricted from
engaging in any activities in competition with the Company during the period of
his employment and an additional twelve months thereafter.
Director and Officer Securities Reports
The Federal securities laws require the Company's Directors
and executive officers, and persons who own more than 10% of a registered class
of the Company's equity securities to file with the Securities and Exchange
Commission initial reports of ownership and reports of changes in ownership of
any equity securities of the Company. Copies of such reports are required to be
furnished to the Company. To the Company's knowledge, based solely on review of
the copies of such reports and other information furnished to the Company, all
persons subject to these reporting requirements filed the required reports on a
timely basis with respect to the Company's year ended January 31, 1996.
Certain Transacations
On September 23, 1994, the Board of Directors authorized the grant to
Dr. Vosika of a five-year option to purchase an aggregate of 250,000 shares of
Common Stock at a price of $.275 per share which option vests and becomes
exercisable to the extent of 50,000 shares on each of any of the following
events occurring: (i) 50,000 shares are to vest at such time as the market price
for the Company's Common Stock reaches each of $.50, $1.00, $2.00, $3.00 and
$4.00 per share, (ii) an IND and initiation of clinical trials relating to a
treatment for Hepatitis C, on or before September 23, 1995, (iii) FDA approval
is received for a pivotal phase III trial for colorectal cancer on or before
September 23, 1996, (iv) the development of a potential new product as evidenced
by the filing of an IND on or before September 23, 1997, or (v) the completion
of a corporate transaction resulting in a $2 million investment in the Company.
On the basis of the filing of an IND for treating Hepatitis C, the option has
vested with respect to 50,000 shares.
5
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At a meeting of the Board of Directors held January 6, 1995, Dr. Vosika
was granted a five-year option to purchase 25,000 shares of Common Stock at an
exercise price of $0.27 per share in lieu of the Company continuing to pay the
premiums on a policy insuring the life of Dr. Vosika.
On March 22, 1996, the Board of Directors granted to Dr. Vosika a
ten-year option to purchase 2,000,000 shares of the Company's Common Stock at an
exercise price of $.065 per share.
On March 1, 1996, the Company entered into a Stock Purchase Agreement
with Dominion Resources, Inc. ("Dominion") pursuant to which Dominion agreed to
purchase and the Company agreed to sell 5,000,000 shares of the Company's Common
Stock at a purchase price per share of $.065. Such shares were sold in three
approximately equal installments at closings held on March 18, April 15, and May
15, 1996. The Purchase Agreement contains various representations and warranties
concerning the Company and its activities and also various affirmative and
negative covenants, including a covenant to elect as a Director of the Company
one person designated by Dominion. Mr. William McManus, President and a Director
of Dominion, serves as Dominion's designee to the Company's Board of Directors.
The Purchase Agreement also grants to Dominion the right to have registered
under the Securities Act of 1933, as amended, the shares sold to Dominion to
enable the public offer and sale of those shares. The agreement restricts the
Company from entering into mergers, acquisitions or sales of its assets without
the prior approval of Dominion's representative on the Company's Board of
Directors.
2. PROPOSAL TO AUTHORIZE CHANGE IN THE COMPANY'S NAME
In May 1996, the Board of Directors adopted, subject to stockholder
approval, an amendment to the Company's Certificate of Incorporation to change
the name of the Company to "Endorex Corp." The current name of the Company is
"ImmunoTherapeutics, Inc." The name ImmunoTherapeutics was adopted in 1987 to
reflect the Company's initial focus on the development of immune stimulating
drugs for the treatment of established cancer. The Company in its evaluation of
its technology is becoming additionally involved in several areas including
vaccine development, particularly for infectious diseases, and compounds and
formulations for the induction of bioactive molecules. Bioactive molecules
induced by the compounds are important in the development of immunity and the
control of viral diseases. Therefore, since the name ImmunoTherapeutics implies
a relatively narrow area of technology, the Company believes that the adoption
of a new corporate name will reflect this broadening of the focus of the
Company's activities.
6
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Endo refers to the primitive gastrointestinal track from which the thymus and
lymphoid system develop and thus, denotes target cells important in the
Company's drug development program.
The adoption of the proposed amendment to the Certificate of
Incorporation to change the corporate name will require the affirmative vote of
the holders of a majority of the outstanding shares of Common Stock.
YOUR DIRECTORS RECOMMEND THAT STOCKHOLDERS VOTE FOR THE ADOPTION OF THE
PROPOSED AMENDMENT OF THE COMPANY'S CERTIFICATE OF INCORPORATION.
VOTING SECURITIES AND PRINCIPAL HOLDERS
The following table sets forth, as of June 10, 1996, information with
respect to each person (including any "group" as that term is used in Section
13(d)(3) of the Securities Exchange Act of 1934)who is known to the Company to
be the beneficial owner of more than five percent of the Company's Common Stock
as well as shares of Common Stock beneficially owned by all Directors of the
Company and all Directors and executive officers of the Company as a group. As
of June 10, 1996, the Company had 9,122,047 shares of Common Stock outstanding.
Percentage of
Name of Outstanding Shares
Beneficial Owner (1) Amount Owned (1)
- - - -------------------- -------------- --------------
Dr. Gerald Vosika 2,139,499(2) 19.1%
3505 Riverview Circle
Moorhead, MN 56560
Dr. Carl Gilbert 27,000(3) -
c/o Immunotherapeutics, Inc.
3505 Riverview Circle
Moorhead, MN 56560
William E. McManus, III, Esquire (4) -
Spencer's Corner
90 Main Street - Suite 211
Centerbrook, CT 06409-1058
Dominion Resources, Inc. 5,000,000 54.8%
c/o The Abbey
355 Madison Avenue
Morristown, New Jersey 07960
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All Directors and officers as
a group (2 persons) 2,166,499(2)(3)(4) 19.3%
(1) Each beneficial owner's percentage ownership is determined by assuming the
exercise of options and warrants that are held by such person (but not those
held by any other person) and which are exercisable within 60 days.
(2) Includes 64,499 shares held beneficially by Dr. Vosika. In addition, it
includes 2,075,000 shares which are the subject of options held by Dr. Vosika.
(3) Includes 1,000 shares held beneficially by Dr. Gilbert. In addition, it
includes 26,000 shares which are the subject of options held by Dr. Gilbert.
(4) Does not include 5,000,000 shares held by Dominion Resources, Inc. Mr.
McManus is the President and a Director of Dominion Resources, Inc. Mr. McManus
disclaims beneficial ownership of the shares held by Dominion Resources, Inc.
The Company has a Shareholders' Rights Plan which may require the
issuance of Series A Preferred Stock, $.05 par value, in connection with the
exercise of certain stock purchase rights. Under the Shareholders' Rights Plan
each outstanding share of the Company's common stock has attached to it one
stock purchase right. These rights will continue to be represented by and trade
with the Company's common stock certificates unless and until certain
takeover-related events occur. Following such events, each right will become
exercisable to purchase one one-hundredth of a share of Series A Preferred
Stock, par value $.05, at an exercise price of $15 per one one-hundredth share
subject to adjustment. In the event any person acquires beneficial ownership of
20% or more of the outstanding common shares, each right will be exercisable,
for a sixty-day period following the announcement of such acquisition, to
purchase the Company's common stock or common stock equivalent having a market
value equal to two times the exercise price. The Shareholders' Rights Plan
further provides that if, after the occurrence of such an acquisition, the
Company is merged into any other corporation or 50% or more of the Company's
assets are sold, each right will be exercisable to purchase common shares of the
acquiring corporation having a market value equal to two times the exercise
price. The rights expire on September 23, 2001, and are subject to redemption by
the Company's Board of Directors at $.001 per right at any time prior to the
first date upon which they become exercisable to purchase common shares.
Committees and Meetings of the Board of Directors
The Company's Board of Directors held three meetings during the year
ended January 31, 1996. The Company does not have any
8
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standing audit, nominating or compensation committees or committees
performing similar functions.
Independent Accountants
Mortenson and Associates, P.C. has served as the Company's independent
accountants since January 1992 and has been selected to continue in such
capacity for the current fiscal year. It is not anticipated that a
representative from that firm will attend the Annual Meeting of Shareholders to
make a statement to shareholders or to answer questions of shareholders.
Submission of Shareholder Proposals for 1997 Annual Meeting
Any proposals which shareholders intend to present for a vote of
shareholders at the Company's 1997 Annual Meeting and which such shareholders
desire to have included in the Company's proxy statement and form of proxy
relating to that meeting must be sent to the Company's executive office and
received by the Company not later than February 17, 1997.
Voting Procedures
Votes at the Annual Meeting of Shareholders are counted by Inspectors
of Election appointed by the Chairman of the meeting. If a quorum is present, an
affirmative vote of a majority of the votes entitled to be cast by those present
in person or by proxy is required for the approval of items submitted to
shareholders for their consideration, including the election of directors,
unless a different number of votes is required by statute or the Company's
certificate of incorporation. Directors are elected by a plurality of the votes
of the shares present in person or represented by proxy at the meeting and
entitled to vote. The adoption of the amendment to the Certificate of
Incorporation to change the corporate name will require the affirmative vote of
the holders of a majority of the outstanding shares of Common Stock. Abstentions
by those present at the meeting are tabulated separately from affirmative and
negative votes and do not constitute affirmative votes. If a shareholder returns
his proxy card and withholds authority to vote for any of the nominees or
withholds a vote on any of the proposals submitted, the votes represented by the
proxy card will be deemed to be present at the meeting for purposes of
determining the presence of a quorum but will not be counted as affirmative
votes. Shares in the name of brokers that are not voted are treated as not
present.
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General
The cost of soliciting proxies will be borne by the Company. In
addition to solicitation by use of the mails, certain officers and regular
employees may solicit proxies personally and by telephone and the Company will
request banks, brokerage houses and nominees and fiduciaries to forward
soliciting material to their principals and will reimburse them for their
reasonable out-of-pocket expenses.
The Company's Annual Report to Shareholders for the fiscal year ended
January 31, 1996 including financial statements, is being mailed to shareholders
herewith.
On written request, the Company will provide, without charge to each
record or beneficial holder of the Company's Common Stock as of June 10, 1996 a
copy of the Company's Annual Report on Form 10-KSB as filed with the Securities
and Exchange Commission for the fiscal year ended January 31, 1996. Requests
should be addressed to Mr. James Burrow, Secretary, ImmunoTherpeutics, Inc.,
3233 Fifteenth Street South, Fargo, North Dakota 58104.
By Order of the Board of Directors,
James Burrow, Secretary
Dated: June 17, 1996
10
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********************************************************************************
APPENDIX: PROXY STATEMENT
IMMUNOTHERAPEUTICS, INC.
3233 FIFTEENTH STREET SOUTH
FARGO, NORTH DAKOTA 58104
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Dr. Gerald Vosika and Mr. James Burrow,
and each of them, as proxies, each with the power to appoint his substitute, and
hereby authorizes them to represent and vote, as designated below, all the
shares of common stock of ImmunoTherapeutics, Inc. held of record by the
undersigned on June 10, 1996 at the annual meeting of shareholders to be held on
July 15, 1996 or any adjournments thereof.
1. Election of Directors
[ ] For all nominees listed below (except as marked to
contrary below)
[ ] Withold Authority to vote for all nominees listed
below
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE, STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST
BELOW.
Gerald J. Vosika William McManus
Carl Gilbert
2. In favor of [ ] Against [ ] Abstain [ ]
Proposal to change the name of the Company to Endorex Corp.
3. In their discretion, the Proxies are authorized to vote
upon such other business as may properly come before the meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BY THE
UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR
EACH OF THE PROPOSALS.
<PAGE>
Please sign exactly as When shares are held by joint tenants both should
name appears below. sign. When signing as attorney, as executor,
administrator trustee or guardian,
please give full title as such. If a
corporation, please sign in full
corporate name by president or other
authorized officer. If a
partnership, please sign in
partnership name by authorized
person.
Dated:_____________________1996
__________________________________ _____________________________________
Please mark, sign, date and return Signature
the proxy card promptly using the
enclosed envelope.
__________________________________ _____________________________________
Signature if held jointly
