<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
FORM 10-Q
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the quarterly period ended June 30, 2000.
or
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from _______________ to
_______________.
COMMISSION FILE NO. 0-19222
GENELABS TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
CALIFORNIA 94-3010150
(State or other jurisdiction of (I.R.S. employer identification number)
incorporation or organization)
</TABLE>
<TABLE>
<S> <C>
505 PENOBSCOT DRIVE, REDWOOD CITY, CALIFORNIA 94063
(Address of principal executive offices) (Zip code)
</TABLE>
Registrant's telephone number, including area code: (650) 369-9500
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
There were 46,119,862 shares of the Registrant's Common Stock issued and
outstanding on August 10, 2000.
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PART I -- FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
GENELABS TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
June 30, Deccember 31,
2000 1999
----------- -------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash, cash equivalents and short-term investments:
Cash and cash equivalents $ 1,174 $ 2,534
Short-term investments 1,609 5,565
---------- ---------
Total cash, cash equivalents and short-term investments 2,783 8,099
Other current assets 113 471
---------- ---------
Total current assets 2,896 8,570
Property and equipment, net 1,693 1,706
Minority investment in Taiwan-based
biopharmaceutical company 1,174 1,174
Other assets 168 239
---------- ---------
$ 5,931 $ 11,689
========== =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings $ -- $ 1,000
Accounts payable and other accrued liabilities 2,243 2,288
Accrued compensation and related expenses 918 1,303
Unearned contract revenue 584 969
---------- ---------
Total current liabilities 3,745 5,560
Long-term obligations 475 558
---------- ---------
Total liabilities 4,220 6,118
---------- ---------
Shareholders' equity:
Preferred stock 4,841 9,682
Common stock 146,558 139,207
Accumulated deficit (149,688) (143,318)
---------- ---------
Total shareholders' equity 1,711 5,571
---------- ---------
$ 5,931 $ 11,689
========== =========
</TABLE>
See notes to condensed consolidated financial statements.
2
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GENELABS TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
For the three months ended For the six months ended
June 30 June 30
-------------------------- ----------------------------
2000 1999 2000 1999
---------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Contract revenue $ 1,635 $ 2,310 $ 3,617 $ 4,139
----------- ------------ ------------ ------------
Operating expenses:
Research and development 3,787 3,739 7,474 6,847
General and administrative 1,432 1,274 2,631 2,501
----------- ------------ ------------ ------------
Total operating expenses 5,219 5,013 10,105 9,348
----------- ------------ ------------ ------------
Operating loss (3,584) (2,703) (6,488) (5,209)
Interest income, net 46 133 118 293
----------- ------------ ------------ ------------
Loss from continuing operations (3,538) (2,570) (6,370) (4,916)
Loss from discontinued
operations of diagnostics
subsidiary -- (317) -- (348)
----------- ------------ ------------ ------------
Net loss $ (3,538) $ (2,887) $ (6,370) $ (5,264)
=========== ============ ============ ============
Loss per share - continuing operations $ (0.09) $ (0.06) $ (0.16) $ (0.12)
=========== ============ ============ ============
Net loss per share $ (0.09) $ (0.07) $ (0.16) $ (0.13)
=========== ============ ============ ============
Weighted average shares outstanding 41,239,744 39,825,642 40,898,811 39,802,320
=========== ============ ============ =============
</TABLE>
See notes to condensed consolidated financial statements.
3
<PAGE> 4
GENELABS TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS)
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
For the six months ended
June 30,
------------------------
2000 1999
------- -------
<S> <C> <C>
Cash flows from operating activities:
Net loss (6,370) $(5,264)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization expense 285 305
Loss of discontinued diagnostics subsidiary -- 348
Changes in assets and liabilities:
Receivables and other current assets 358 (57)
Accounts payable, accrued liabilities, accrued
compensation and long-term obligations (513) (953)
Unearned contract revenue (385) 220
------- --------
Net cash used in operating activities (6,625) (5,401)
------- --------
Cash flows from investing activities:
Purchases of securities available-for-sale -- (3,000)
Proceeds from sales and maturities of securities
available-for-sale 3,956 8,857
Capital expenditures (272) (714)
Other 71 43
-------- --------
Net cash provided by investing activities 3,755 5,186
-------- --------
Cash flows from financing activities:
Proceeds from issuance of common stock 2,510 244
Payments on short-term borrowings (1,000) (1,000)
-------- --------
Net cash provided by/(used in) financing activities 1,510 (756)
-------- --------
Net decrease in cash and cash equivalents (1,360) (971)
Cash and cash equivalents, beginning of the period 2,534 3,631
-------- --------
Cash and cash equivalents, end of the period 1,174 2,660
Short-term investments, end of the period 1,609 10,813
-------- --------
Cash, cash equivalents and short-term investments,
end of the period $ 2,783 $13,473
========= ========
</TABLE>
See notes to condensed consolidated financial statements.
4
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GENELABS TECHNOLOGIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
JUNE 30, 2000
1. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements
include the accounts of Genelabs Technologies, Inc. and its subsidiaries
("Genelabs" or the "Company") after elimination of all significant intercompany
accounts and transactions. Genelabs is engaged in the discovery and development
of a new class of pharmaceutical products that selectively regulate the
activation or deactivation of genes, or gene expression, and in the development
of GL701, our proprietary hormone treatment for systemic lupus erythematosus
("SLE" or "lupus"). We have completed two clinical trials of GL701 for the
treatment of lupus in women, and have submitted the clinical portion of a new
drug application for GL701 to the U.S. Food and Drug Administration, or FDA. We
plan to submit the remaining portions of the new drug application by the end of
2000. We intend that significant funding for the discovery and development of
our future products would be provided by revenue from the sales of GL701, should
the FDA approve it.
The Company will require additional financial resources to complete the
development and commercialization of its products. In the near-term, management
plans to finance the Company through issuances of equity securities. Thereafter,
management intends to fund its operations principally from revenue received from
sales of GL701, should the FDA approve this drug candidate. If the financing
arrangements contemplated by management are not completed, the Company may have
to seek other sources of capital or reevaluate its operating plans.
These financial statements have been prepared in accordance with generally
accepted accounting principles ("GAAP") for interim financial information and
with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by GAAP for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring adjustments) considered necessary
for a fair presentation have been included. Operating results for the
three-month and six-month periods ending June 30, 2000 are not necessarily
indicative of the results that may be expected for the year ending December 31,
2000.
These unaudited condensed consolidated financial statements are meant to be
read in conjunction with the audited consolidated financial statements and
footnotes thereto included in the Company's Annual Report on Form 10-K, as
amended, for the year ended December 31, 1999.
2. COMPREHENSIVE INCOME
During the three months ended June 30, 2000 and 1999, the Company's
comprehensive loss amounted to $(3,538,000) and $(2,852,000), respectively, and
for the six months ended June 30, 2000 and 1999, the Company's comprehensive
loss amounted to $(6,370,000) and $(5,332,000).
5
<PAGE> 6
3. CONVERSION OF CONVERTIBLE PREFERRED STOCK
As of June 6, 2000, one of the two corporate investors that had previously
purchased the Company's Series A Convertible Preferred Stock elected to convert
their Preferred Stock into Genelabs common stock. Based on the conversion
formula established when the Preferred Stock was issued in 1995, the Company
issued 1,666,666 shares of common stock to this investor when the conversion
notice was received.
As of August 7, 2000, the remaining investor in the Company's Series A
Convertible Preferred Stock elected to convert their Preferred Stock into
Genelabs common stock, and the Company issued 1,666,666 shares of common stock
to this investor. The effect of this second conversion will be recorded in
Genelabs' third quarter financial statements. The Company no longer has any
shares of Preferred Stock outstanding.
4. SUBSEQUENT EVENTS
On July 10, 2000, the Company entered into an agreement for an equity
financing facility with Acqua Wellington North American Equities Fund, Ltd.
covering the sale of up to $29 million of Genelabs common stock. Under this
agreement, Acqua Wellington made an initial investment of $4 million through a
purchase of 1,000,000 shares of Genelabs' registered common stock. Over the
eighteen-month period beginning July 10, 2000, Genelabs has the ability to sell
additional shares to Acqua Wellington, at Genelabs' discretion, at discounts
ranging from 3.5% to 6% of the market price at the time of sale. The total
amount of the investment will be dependent, in part, on Genelabs' stock price,
with the Company controlling the amount and timing of the stock sold. Genelabs
will issue no warrants in connection with this financing facility, and will pay
no fees or other compensation to Acqua Wellington or any other parties.
On August 8, 2000, Genelabs sold an additional 779,271 shares to Acqua
Wellington for $3.1 million.
The following pro forma balance sheet treats the equity transactions
described above as if they had occurred on June 30, 2000, including estimated
legal, accounting and other expenses. All amounts are in thousands of dollars.
<TABLE>
<CAPTION>
June 30 Pro-forma June 30
ASSETS actual adjustments Pro-forma
------- ----------- ----------
<S> <C> <C> <C>
Cash and short-term investments $ 2,783 $7,111 $ 9,894
Other current assets 113 113
Property and equipment, net 1,693 1,693
Minority investment in Taiwan
based biopharmaceutical company 1,174 1,174
Other noncurrent assets 168 168
------- ----------- ----------
$ 5,931 $7,111 $13,042
======= =========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 3,745 $ 100 $ 3,845
Long-term obligations 475 475
------- ----------- ----------
Total liabilities 4,220 4,320
Total shareholders' equity 1,711 7,011 8,722
------- ----------- ----------
$ 5,931 $7,111 $13,042
======= =========== ==========
</TABLE>
6
<PAGE> 7
5. RECENT ACCOUNTING PRONOUNCEMENTS
In March 2000, the Financial Accounting Standards Board issued FASB
Interpretation No. 44, "Accounting for Certain Transactions involving Stock
Compensation" ("FIN 44"), which contains rules designed to clarify the
application of Accounting Principles Board Opinion No. 25, "Accounting for Stock
Issued to Employees." FIN 44 will be effective on July 1, 2000 and the Company
will adopt it at that time. The Company believes the impact of adopting FIN 44
will not be material to the operating results or financial position of the
Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
All statements in Management's Discussion and Analysis of Financial
Condition and Results of Operations that are not historical are forward-looking
statements. Forward-looking statements involve a number of risks and
uncertainties. These risks and uncertainties include, but are not limited to,
those statements concerning regulatory approval, clinical trials, progress of
drug discovery programs, the Company's business plans, anticipated expenditures
and the timing and need for additional funds. Forward-looking statements may be
identified by terminology such as "may," "will," "expects," "anticipates,"
"intends," "plans," "believes," "potential" and similar expressions. Some of the
factors that could cause material differences in actual results of the Company's
activities are uncertainty of regulatory approval, the outcome of drug discovery
and product development efforts, manufacturing risks, intellectual property
rights and other factors and risks detailed under the caption "Risk Factors" in
the Company's 1999 Annual Report on Form 10-K/A, the Company's Registration
Statement on Form S-3/A filed on June 21, 2000, and other filings with the U.S.
Securities and Exchange Commission. Shareholders and prospective investors in
the Company should carefully consider these risk factors. The Company disclaims
any obligation to update these statements for subsequent events.
Genelabs Technologies, Inc. is engaged in the discovery and development of
a new class of pharmaceutical products that selectively regulate the activation
or deactivation of genes, or gene expression, and in the development of GL701,
our proprietary hormone treatment for a disease called systemic lupus
erythematosus, or lupus. We have completed two clinical trials of GL701 for the
treatment of lupus in women, and have submitted the clinical portion of a new
drug application for GL701 to the U.S. Food and Drug Administration, or FDA. We
plan to submit the remaining portions of the new drug application by the end of
2000. We intend that significant funding for the discovery and development of
our future products would be provided by revenue from the sales of GL701, should
the FDA approve it.
Our goal is to be the world leader in the development of drugs based on
selective regulation of gene expression. Because functions of all cells, tissues
and organs are controlled by gene expression and the resulting production of
proteins, the potential application of our technology is broad and profound. For
example, we may be able to restore proper gene function in disease-causing
cells, whether this involves increasing or decreasing the expression level of a
specific gene. Our technology would also allow treatment of diseases by
selectively promoting the production of specific beneficial proteins in the
body. Genelabs owns key patents covering the development of drugs that
selectively regulate gene expression by directly binding to DNA, the fundamental
material of genes. We have also developed a related technology for the
development of proprietary compounds that act directly on the genetic material
of viruses to inhibit their replication. By directly acting on the genetic
material, we believe these technologies can be applicable to a wide range of
indications, including diseases such as cancer and diabetes and diseases caused
by bacteria and viruses.
Public and private efforts are expending enormous scientific and financial
resources to the sequencing of the human genome, the complete set of human
genes, as well as the genomes of many pathogenic organisms. Genelabs' drug
discovery efforts will benefit greatly from this ongoing genomic
7
<PAGE> 8
research as the descriptions and functions of specific genes, the intended
targets of our potential products, are detailed and better understood. There are
many potential advantages of drugs that could selectively regulate gene
expression. Because they act at the root cause of disease caused by a
malfunctioning specific gene, drugs that selectively regulate gene expression
could have therapeutic effects superior to alternative treatments. Because these
drugs are intended to act only at the sites of specific genes, they may also
have fewer and more acceptable side effects than currently available therapies.
In many instances these drugs may be small molecular compounds, which means they
may be orally administered. Drugs that selectively regulate gene expression may
also have advantages in the cost and time of their development and cost of
manufacture, especially in comparison to protein-based drugs.
In addition to our internal research efforts, we have licensed GL701 from
Stanford University and developed it into a near-term product opportunity as a
treatment for systemic lupus erythematosus. There are approximately 200,000
lupus patients in the United States and over a million worldwide. Lupus is a
life-long autoimmune disease that causes the immune system to attack the body's
own tissues and organs. It primarily affects women, many of whom experience
initial symptoms when they are in their late teens or early twenties. There is
no known cure for lupus and currently approved drug treatments are inadequate.
Prednisone, a commonly used steroid drug treatment for lupus, has many serious
side effects including osteoporosis, atherosclerosis and diabetes, and is a
leading cause of disability and death in lupus patients. If approved by the FDA,
GL701 will be the first new treatment for this debilitating disease in 40 years.
We believe GL701 is ideally suited as our first pharmaceutical product because
it addresses a clear, unmet medical need in an area for which no current
therapies compete or are being actively promoted. In addition, infrastructure
requirements for launching GL701 are relatively minor compared to those needed
for other new drugs, since a concentrated physician specialty treats most lupus
patients. Therefore, we plan to commercially introduce GL701 to the U.S. market
ourselves, and to commercialize GL701 elsewhere in the world through
partnerships or licensing arrangements with major pharmaceutical companies.
We believe that Genelabs is uniquely positioned in the biopharmaceutical
industry with both a near-term drug candidate that has completed clinical trials
and a proprietary and potentially industry-changing approach to drug discovery.
RESULTS OF OPERATIONS - SECOND QUARTER 2000 COMPARED TO SECOND QUARTER 1999
The net loss was $3.5 million for the three months ended June 30, 2000,
compared to $2.9 million for the same period in 1999. The increase in net loss
in the second quarter of 2000 compared to the second quarter of 1999 was due to
lower contract revenues and expenses related to the anticipated launch of GL701.
Partially offsetting these items were lower costs for the Company's discontinued
diagnostics subsidiary. There were no losses recorded for this subsidiary in the
second quarter of 2000 because its net assets were written-off in 1999.
Contract revenues decreased to $1.6 million in the second quarter of 2000
compared to $2.3 million in the second quarter of 1999 primarily due to the
termination of the Company's collaboration with DuPont. Contract revenues
include grant, licensing, milestone, and research and development payments.
Contract revenues recognized in the future will be dependent upon the
continuation of existing grants and the establishment of new research,
development and/or licensing agreements.
Operating expenses increased to $5.2 million in the second quarter of 2000
compared to $5.0 million in the second quarter of 1999. In the second quarter of
2000, research and development expenses were 73% of operating expenses compared
to 75% of operating expenses in 1999. Research and development expenses were
$3.8 million in the second quarter of 2000 compared to $3.7 million in the
second quarter of 1999. In the second quarter of 2000, Genelabs incurred higher
costs for GL701, as the Company prepared and submitted to the FDA the clinical
portion of its new drug application, and continued work on the other portions of
the new drug application. Largely offsetting the higher costs for
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GL701 were lower costs for the Company's drug discovery program and lower costs
for non-core research programs. General and administrative expenses increased to
$1.4 million in the second quarter of 2000 compared to $1.3 million in the
second quarter of 1999 as the Company began preparations for building the
internal infrastructure to support the anticipated launch of GL701.
RESULTS OF OPERATIONS - FIRST HALF 2000 COMPARED TO FIRST HALF 1999
The net loss was $6.4 million for the six months ended June 30, 2000,
compared to $5.3 million for the same period in 1999. The increase in net loss
in the first half of 2000 compared to the first half of 1999 was primarily due
to lower contract revenues and additional expenditures related to the Company's
new drug application for GL701 for lupus.
Contract revenues decreased to $3.6 million in the first half of 2000
compared to $4.1 million in the first half of 1999 primarily due to the
termination of the Company's collaboration with DuPont, partially offset by
revenues from a pilot research program entered into for one of Genelabs non-core
research programs. Contract revenues include grant, licensing, milestone, and
research and development payments. Contract revenues recognized in the future
will be dependent upon the continuation of existing grants and the establishment
of new research, development and/or licensing agreements.
Operating expenses increased to $10.1 million in the first half of 2000
compared to $9.3 million in the first half of 1999. In the first half of 2000
research and development expenses were 74% of operating expenses compared to 73%
of operating expenses in the first half of 1999. Research and development
expenses increased to $7.5 million in the first half of 2000 compared to $6.8
million in the first half of 1999 due to costs associated with the preparation
of a new drug application with the FDA. General and administrative expenses were
$2.6 million in the first half of 2000 compared to $2.5 million in the first
half of 1999, as the Company began preparations for building the internal
infrastructure to support the anticipated launch of GL701. In the first half of
2000 there were no losses recorded for the Company's discontinued diagnostics
subsidiary since its net assets were written-off in 1999.
LIQUIDITY AND CAPITAL RESOURCES
The Company had cash, cash equivalents and short-term investment balances
totaling $2.8 million at June 30, 2000, compared to $8.1 million at December 31,
1999. The decrease in cash, cash equivalents and short-term investments during
the first half of 2000 was primarily attributable to $6.6 million used in
operations, $1.0 million used to repay short-term borrowings, and $0.3 million
used to purchase capital equipment. These uses were partially offset by $2.6
million received from the exercise of stock options and other non-operating cash
sources.
Subsequent to June 30, 2000, Genelabs has received $7.1 million from the
sale of common stock. Genelabs expects these funds to allow the Company to
maintain its current and planned operations into the second quarter 2001,
although prior to this time Genelabs intends to seek additional funds through
additional sales of equity and through corporate partnership or licensing
arrangements.
RISK FACTORS
The following discussion summarizes several risks which management believes
are particularly relevant at this time. There is more detailed information about
these risks and additional risks under the caption "Risk Factors" in the
Company's 1999 Annual Report on Form 10-K, as amended, and in the Company's
Registration Statement on Form S-3, as amended. Shareholders and prospective
investors are encouraged to review these documents.
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<PAGE> 10
IF THE FDA DOES NOT APPROVE GL701 FOR MARKETING IN THE UNITED STATES, OUR
BUSINESS PROSPECTS WILL SUFFER BECAUSE WE HAVE NO OTHER CURRENT SOURCE OF
POTENTIAL REVENUE.
Genelabs has focused its development efforts to date on conducting clinical
trials for GL701 for the treatment of women with systemic lupus erythematosus.
Before we can market GL701 in the United States, the FDA must review and approve
a new drug application submitted by Genelabs incorporating all of the data from
the clinical trials of the drug. The new drug application also contains other
required information, such as data relating to the toxicity of the drug and the
manufacturing requirements of the drug. Genelabs recently submitted to the FDA
part of its new drug application for GL701 for lupus, and plans to complete
submission of the new drug application by the end of 2000. Genelabs' business
plans depend on FDA approval of GL701 in the United States. If the FDA does not
approve the new drug application in a timely manner, our business would suffer
because we have no other current source of potential revenue.
GENELABS' RESEARCH PROGRAMS ARE IN AN EARLY STAGE AND MAY NOT SUCCESSFULLY
PRODUCE COMMERCIAL PRODUCTS.
Genelabs' research is in an early stage. Our research focuses on the
discovery of pharmaceutical products that selectively regulate gene expression
and separately, pharmaceutical products that treat viral, fungal and bacterial
infections. To date, Genelabs' research programs have not produced a compound
that has progressed into clinical trials. The goal of our research is to
discover novel chemical compounds that bind directly to DNA or RNA, the
fundamental matter in genes, and develop them into drugs. Genelabs, or others
working in this area, may never achieve this goal.
IF WE CANNOT OBTAIN ADDITIONAL FUNDS, WE WILL NOT BE ABLE TO CARRY OUT OUR
BUSINESS PLAN, AND WE WILL NOT BE ABLE TO INTRODUCE GL701 TO THE MARKET.
We have incurred losses in each year since our inception and have
accumulated approximately $150 million in net losses through June 30, 2000,
including a net loss of $12.8 million in 1999 and $6.4 million for the first
half of 2000. We anticipate realizing a net loss at least through 2001, and we
may not be profitable after that time. Our revenues may not be sufficient to
fund operations or we may not achieve profitability or positive cash flow in the
near future or at all. As of August 10, 2000, our cash balance was approximately
$7.5 million. As of August 10, 2000, we also had additional committed sources of
funding, primarily revenue from DARPA, of approximately $2.5 million due to
Genelabs before the end of the year. We believe these funds are sufficient to
sustain our operations into the second quarter of 2001. Thereafter, known
sources of funding will not be sufficient to sustain our planned operations.
Because we have limited funds, we will need to obtain additional funds to
sustain our continuing operations and research and development activities.
In order to have the necessary resources to commercially launch GL701, we
plan to sell additional equity. This type of financing would dilute existing
shareholders. If we do not complete financing arrangements currently
contemplated, we may have to seek other sources of capital, such as strategic
alliances, which may require us to grant third parties rights to our
intellectual property assets. We may also need to change our operating plans.
Longer-term, we plan to fund our operations principally from revenue from sales
of GL701. However, GL701 may never receive FDA approval, and if it does, we may
never generate revenue from sales of GL701. Although we are currently pursuing
foreign GL701 licensing agreements, we may fail to enter into license agreements
on acceptable terms, if at all. We also may be unable to find buyers willing to
purchase our equity or to license our products or technology on commercially
favorable terms, if at all. The unavailability of additional funds would harm
our business by delaying or preventing the development, testing, regulatory
approval, manufacturing or marketing of our products and technologies.
10
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PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On June 1, 2000, the Company held its Annual Meeting of shareholders. One
matter was voted upon at the meeting and the number of affirmative votes and
withheld votes cast were as follows:
<TABLE>
<CAPTION>
Affirmative Withheld
Votes Votes
----------- ---------
<S> <C> <C> <C> <C>
1. Election of the Company's Directors:
Irene A. Chow 33,826,382 257,611
J. Richard Crout 34,000,033 83,960
Thomas E. Dewey, Jr. 33,983,678 100,315
Arthur Gray, Jr. 33,992,348 91,645
H.H. Haight 34,000,883 83,110
Alan Y. Kwan 33,995,185 88,808
James A.D. Smith 33,986,425 97,568
Nina K. Wang 33,959,525 124,468
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27. Financial Data Schedule
(b) Reports on Form 8-K
There were no reports on Form 8-K filed during the quarter ended June 30,
2000.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GENELABS TECHNOLOGIES, INC.
(Registrant)
Principal Executive Officer:
/s/ JAMES A.D. SMITH
Date: August 10, 2000 -----------------------------
James A.D. Smith
President and Chief Executive Officer
Principal Accounting Officer:
/s/ MATTHEW M. LOAR
Date: August 10, 2000 -----------------------------
Matthew M. Loar
Vice President, Finance
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Number Description
------ -----------
<S> <C>
27. Financial Data Schedule
</TABLE>
12
