<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
CELLPRO, INCORPORATED
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
CELLPRO, INCORPORATED
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 7, 1998
TO THE STOCKHOLDERS OF CELLPRO, INCORPORATED:
The Annual Meeting of Stockholders of CellPro, Incorporated (the
"Company"), a Delaware corporation, will be held on Wednesday, October 7, 1998,
at 10:00 a.m. local time, at the Company's corporate headquarters located at
22215 26th Avenue S.E., Bothell, Washington 98021, for the purpose of
considering and voting on the following matters:
1. Election of directors to serve for the ensuing year or until their
successors are duly elected and qualified.
2. Ratification of PricewaterhouseCoopers LLP as independent
accountants of the Company for the fiscal year ending March 31, 1999.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only stockholders of record at the close of business on August 10, 1998
are entitled to notice of and to vote at the annual meeting or any adjournment
thereof.
All stockholders are cordially invited to attend the meeting in person.
However, to ensure your representation at the meeting, you are urged to sign and
return the enclosed Proxy as promptly as possible in the envelope enclosed for
that purpose.
Any stockholder attending the meeting may vote in person even if he or
she has returned a Proxy.
Sincerely,
Richard D. Murdock,
President and Chief Executive Officer
July 29,1998
YOUR VOTE IS VERY IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES YOU OWN. PLEASE
READ THE ATTACHED PROXY STATEMENT CAREFULLY, AND COMPLETE, SIGN AND DATE THE
ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE AND RETURN IT IN THE ENCLOSED
ENVELOPE.
<PAGE> 3
CELLPRO, INCORPORATED
22215 26TH AVENUE, S.E.
BOTHELL, WASHINGTON 98021
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER 7, 1998
The enclosed proxy ("Proxy") is solicited on behalf of the Board of
Directors of CellPro, Incorporated, a Delaware corporation (the "Company"), for
use at the Company's Annual Meeting of Stockholders to be held on October 7,
1998 (the "Annual Meeting") at 10:00 a.m., or any adjournment thereof, at the
Company's corporate headquarters located at 22215 26th Avenue, S.E., Bothell,
Washington 98021. The Company expects that proxy solicitation materials will be
mailed on or about August 17, 1998 to all stockholders entitled to vote at the
Annual Meeting.
GENERAL
STOCKHOLDERS ENTITLED TO VOTE
Stockholders of record at the close of business on August 10, 1998 (the
"Record Date") will be entitled to vote at the Annual Meeting. The Company
believes that there will be approximately 14,633,127 shares of Common Stock,
$.001 par value, issued and outstanding on the Record Date. As of July 29, 1998,
no shares of the Company's Preferred Stock were outstanding, and the Company
believes that no shares of the Company's Preferred Stock will be outstanding on
the Record Date. With regard to all matters submitted to a vote at the Annual
Meeting, each share of Common Stock is entitled to one vote.
QUORUM
The presence, in person or by Proxy, of the holders of a majority of
the shares of Common Stock outstanding on August 10, 1998 will constitute a
quorum to conduct business.
VOTING
Stockholders of record may vote their proxies by marking, signing,
dating and mailing their proxies in the postage-paid envelope provided. If the
proxy is properly executed and returned, the shares will be voted in accordance
with the stockholder's instructions. If no instructions are given with respect
to a matter, the proxy will be voted in accordance with the recommendations of
the Board of Directors set forth herein.
A stockholder may, with respect to the election of directors (i) vote
for all six nominees named herein, (ii) withhold authority to vote for all such
nominees or (iii) vote for all of such nominees other than any nominee with
respect to which the stockholder withholds authority to vote. The six candidates
receiving the highest number of affirmative votes in person or by Proxy at the
Annual Meeting will be elected directors of the Company. A stockholder may, with
respect to the ratification of the selection of PricewaterhouseCoopers LLP as
auditors (i) vote "FOR," (ii) vote "AGAINST" or (iii) "ABSTAIN" from voting. An
affirmative vote of a majority of the shares present in person or by Proxy and
entitled to vote at the Annual Meeting is required for approval of such matter.
Abstentions will be counted as shares present for determining the presence of a
quorum; such shares also will be treated as shares present and entitled to vote,
which will have the same effect as a vote against such matter, whereas broker
non-votes will not be counted for purposes of determining whether a proposal has
been approved or not.
<PAGE> 4
REVOCABILITY OF PROXIES
Any person giving a Proxy has the power to revoke it at any time before
its exercise. It may be revoked by filing a notice of revocation or another
signed Proxy with a later date with the Vice President and General Counsel of
the Company at the Company's principal corporate offices, CellPro, Incorporated,
22215 26th Avenue, S.E., Bothell, Washington 98021. You may also revoke your
Proxy by attending the Annual Meeting and voting in person. Stockholders whose
shares are held in the name of a broker, bank or other holder of record may not
vote in person at the meeting unless they have first obtained a proxy, executed
in the stockholder's favor, from the holder of record.
SOLICITATION
The Company will bear the entire cost of solicitation, including the
preparation, assembly, printing and mailing of this Proxy Statement, the Proxy
and any additional soliciting materials furnished to stockholders. Copies of
solicitation materials will be furnished to brokerage houses, fiduciaries and
custodians holding shares in their names that are beneficially owned by others
so that they may forward this solicitation material to such beneficial owners.
In addition, the Company may reimburse such persons for their costs in
forwarding the solicitation materials to such beneficial owners. The original
solicitation of proxies by mail may be supplemented by solicitation by
telephone, telegram or other means by directors, officers, employees or agents
of the Company. No compensation will be paid to these individuals for any such
services. The Company also reserves the right to have an outside solicitor
conduct the solicitation of proxies and to pay such solicitor for its services.
Except as described above, the Company does not presently intend to solicit
proxies other than by mail.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS FOR 1999 ANNUAL MEETING
Proposals of stockholders of the Company that are intended to be
presented by such stockholders at the Company's 1999 Annual Meeting must be
received by the Company no later than February 19, 1999 to be included in the
Company's proxy statement and form of proxy relating to that meeting.
SHARE OWNERSHIP
Stockholders of record on August 10, 1998 are entitled to notice of and
to vote at the Annual Meeting. The Company believes that approximately
14,633,127 shares of the Company's Common Stock, $.001 par value, will be issued
and outstanding on such date. As of July 29, 1998, no shares of the Company's
Preferred Stock were outstanding, and the Company believes that no shares of the
Company's Preferred Stock will be outstanding as of August 10, 1998. All votes
will be tabulated by the inspector of election appointed for the meeting, who
will separately tabulate affirmative and negative votes, abstentions and broker
non-votes. Abstentions will be counted towards the tabulation of votes cast on
proposals presented to the stockholders and will have the same effect as
negative votes, whereas broker non-votes will not be counted for purposes of
determining whether a proposal has been approved or not. Each stockholder is
entitled to one vote for each share of Common Stock held by such stockholder.
The following table sets forth information known to the Company
regarding the ownership of the Company's Common Stock as of: (a) May 31, 1998,
for (i) each director and nominee, (ii) each executive officer named in the
Summary Compensation table beginning on page 7 and (iii) all executive officers
and directors of the Company as a group; and (b) March 31, 1998, for all persons
or entities who were known by the Company to be beneficial owners of five
percent (5%) or more of the Company's Common Stock as of such date. Unless
otherwise indicated, each of the following stockholders has sole voting and
investment power with respect to the shares beneficially owned, subject to
community property laws where applicable.
2
<PAGE> 5
<TABLE>
<CAPTION>
Number of
Name and Address Shares Percent of Total Shares*
---------------- ------ ------------------------
<S> <C> <C>
Corange International Limited (1)............................ 1,160,362 7.9%
Church and Parliament Streets
Hamilton, HM 12
Bermuda
Boehringer Mannheim Corporation (2).......................... 1,000,000 6.8%
101 Orchard Ridge Drive
Gaithersburg, Maryland 20878
Amerindo Investment Advisors Inc. (3)........................ 957,500 6.5%
One Embarcadero Center, Suite 2300
San Francisco, California 94111
Richard D. Murdock (4)....................................... 466,688 3.2%
Larry G. Culver (5).......................................... 271,098 1.9%
S. Joseph Tarnowski, Ph.D. (5)............................... 162,704 1.1%
Joseph S. Lacob (5).......................................... 107,147 **
Cindy A. Jacobs, Ph.D., M.D. (4)............................. 73,328 **
Edward F. Kenney (4)......................................... 49,272 **
Charles P. Waite, Jr. (5).................................... 31,165 **
Joshua L. Green (4) (6)...................................... 25,841 **
Kenneth W. Anstey (4)........................................ 20,000 **
All directors and executive
officers as a group (10 people) (7).......................... 1,218,076 8.3%
</TABLE>
- ----------
* Percentage determined by calculating a fraction, the numerator of which
is based on share ownership as of the applicable disclosed date and the
denominator of which is the total number of shares expected to be
outstanding on the Record Date.
** Less than 1.0%
(1) Based on a March 1998 Schedule 13(G) filing but without verification
from Corange International Limited.
(2) Based on a March 1998 Schedule 13(G) filing but without verification
from Boehringer Mannheim Corporation.
(3) Based on a February 1998 Schedule 13(G) filing but without verification
from Amerindo Investment Advisors Inc.
(4) Represents options granted under the Company's Restated 1989 Stock
Option Plan (the "Stock Option Plan") that may be exercised within 60
days of May 31, 1998.
(5) Includes shares of Common Stock which the following directors and
executive officers have the right to acquire within 60 days of May 31,
1998 upon exercise of stock options granted under the Stock Option
Plan: Mr. Culver, 261,098 shares; Mr. Lacob, 40,567 shares; Dr.
Tarnowski, 161,604 shares; Mr. Waite, 30,000 shares; and Mr. Green,
25,000 shares.
(6) Includes 841 shares held by a revocable trust of which Mr. Green is a
trustee, as to which shares Mr. Green has shared voting and investment
power with his spouse as co-trustee.
(7) Includes options to purchase an aggregate of 1,137,823 shares granted
under the Stock Option Plan held by directors and executive officers
that may be exercised within 60 days of May 31, 1998.
3
<PAGE> 6
MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING
PROPOSAL ONE -- ELECTION OF DIRECTORS
The Bylaws of the Company provide that the Board of Directors shall be
comprised of not less than five nor more than nine directors, with the exact
number to be fixed by the Board. The current number of directors is six. At the
Annual Meeting, six directors are to be elected to serve until the Company's
next Annual Meeting or until their successors are duly elected and qualified.
The Board of Directors has selected six nominees, all of whom are current
directors of the Company. Each person nominated for election has agreed to serve
if elected and management is not aware of any nominee who is unable to serve. IT
IS INTENDED THAT ALL PROXIES IN THE ACCOMPANYING FORM, UNLESS CONTRARY
INSTRUCTIONS ARE GIVEN, WILL BE VOTED FOR THE NOMINEES NAMED BELOW. The six
candidates receiving the highest number of affirmative votes in person or by
proxy at the Annual Meeting will be elected directors of the Company.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE
ELECTION OF EACH OF THE FOLLOWING NOMINEES TO SERVE AS DIRECTORS OF THE COMPANY
UNTIL THE NEXT ANNUAL MEETING OR UNTIL THEIR SUCCESSORS HAVE BEEN ELECTED AND
QUALIFIED.
NOMINEES
Set forth below is information regarding the nominees, including
information furnished by them as to principal occupations, certain other
directorships held by them, any arrangements pursuant to which they were
selected as directors or nominees and their ages as of June 15, 1998.
<TABLE>
<CAPTION>
Year First
Name Age Elected Director
---- --- ----------------
<S> <C> <C>
Kenneth W. Anstey...................................... 52 1996
Larry G. Culver........................................ 48 1995
Joshua L. Green........................................ 42 1995
Joseph S. Lacob........................................ 42 1989
Richard D. Murdock..................................... 51 1992
Charles P. Waite, Jr................................... 43 1989
</TABLE>
BACKGROUND OF DIRECTORS
MR. ANSTEY has served as a Director of the Company since February 1996.
Since July 1997, he has been President and Chief Executive Officer of ORATEC
Interventions, Inc., a medical device company focusing on the orthopedic markets
of orthoscopic surgery and minimally evasive therapies for back pain. Mr. Anstey
served as President and Chief Executive Officer of Biofield Corporation, an
early stage medical device company which is developing breast cancer detection
technologies, from 1995 to 1997. From 1991 until he joined Biofield in 1995, Mr.
Anstey was President and Chief Executive Officer of Mitek Surgical Products,
Inc., a suture anchoring device company. Mr. Anstey also serves as a Director
for Vision-Sciences, Inc., which develops and markets an innovative sheath for
various endoscopes. Mr. Anstey received an M.B.A. in 1970 from Michigan State
University.
MR. CULVER has served as a Director of the Company since May 1995. From
February 1996 to June 1998, Mr. Culver was Executive Vice President and Chief
Operating Officer of the Company. Mr. Culver joined the Company as Vice
President of Finance and Administration and Chief Financial Officer in March
1991 and became Senior Vice President in August 1993. In July 1998, he joined
Metapath Software Corporation, a telecommunications software company, as its
Chief Financial Officer and Senior Vice President of Finance and Operations. Mr.
Culver received an M.B.A. in 1977 from the University of Wisconsin.
4
<PAGE> 7
MR. GREEN has served as a Director of the Company since June 1995. He
has been a director with the law firm of Venture Law Group since August 1995.
From 1980 until he joined Venture Law Group, Mr. Green had been an associate and
partner with the law firm of Brobeck, Phleger & Harrison L.L.P. Mr. Green has
served as Secretary of the Company since 1989. Mr. Green received a B.A. and
J.D. from the University of California at Los Angeles in 1977 and 1980,
respectively.
MR. LACOB, a co-founder of the Company, has been Chairman of the Board
since 1990. He has served as a Director of the Company since March 1989 and
served as its Acting President from March 1989 to November 1989. Mr. Lacob has
been a general partner of Kleiner Perkins Caufield & Byers, a venture capital
firm, since May 1992. Mr. Lacob serves as a Director for the following public
companies: Heartport, Inc., which develops systems and procedures for minimally
invasive cardiac surgery; Corixa, Inc., which develops vaccines for cancer and
infectious diseases; Pharmacyclics, Inc., which develops macrocyclic chemistry
for treatment of diseases such as cancer and atherosclerosis and for diagnostic
imaging procedures; and Sportsline U.S.A., an internet sports web site. Mr.
Lacob holds an M.P.H. from the University of California, Los Angeles and
received an M.B.A. in 1983 from Stanford University.
MR. MURDOCK has served as President of the Company since December 1991
and Chief Executive Officer and a Director of the Company since June 1992. From
August 1991 to December 1991, he served as Vice President of Marketing and
Corporate Development. Mr. Murdock has also served in the following capacities
for the following subsidiaries of the Company: as a Director of CellPro Europe
N.V./S.A. since April 1992, of CellPro France S.A.R.L. since April 1994, of
CellPro Deutschland GmbH since January 1994, of CellPro Italia s.r.l. since
December 1994, of CellPro Biotech Iberica S.L. since May 1995, of CellPro
Asia-Pacific Pty. Ltd. since November 1996 and as a Director, President and
Chief Executive Officer of CellPro II, Inc. since October 1993. Mr. Murdock is
also a member of the Board of Directors of SangStat Medical Corporation, which
is developing medical products related to organ transplantation. Mr. Murdock
received a B.S. in Zoology in 1969 from the University of California at
Berkeley.
MR. WAITE has served as a Director of the Company since March 1989. Mr.
Waite has been a general partner of Olympic Venture Partners II, a venture
capital firm, since 1987. Mr. Waite is also a member of the Board of Directors
for Verity, Inc, which develops and markets tools for locating information on
the Internet and other databases and Cardima, Inc., which develops and markets
diagnostic and therapeutic catheters. He received an M.B.A. in 1983 from Harvard
University.
There are no family relationships among executive officers or directors
of the Company.
OTHER EXECUTIVE OFFICERS
CINDY A. JACOBS, PH.D., M.D. was named Vice President of Clinical
Research in April 1996. Dr. Jacobs joined the Company in October 1993 as
Director of Clinical Research and was subsequently named Director of Worldwide
Clinical Research. From 1985 until October 1993 Dr. Jacobs served in various
research and management positions including Associate Medical Director, Clinical
Research, for Immunex Corporation, a biopharmaceutical company involved in the
development, manufacture and sale of products to treat cancer, autoimmune
disorders and infectious diseases. Dr. Jacobs received a B.S. from Montana State
University in 1979, a Ph.D. from Washington State University in 1984, and an
M.D. from the University of Washington Medical School in 1989.
S. JOSEPH TARNOWSKI, PH.D. joined the Company as Vice President of
Operations in June 1992. He was appointed to the position of Vice President of
Research and Development in June 1995 and became Senior Vice President and Chief
Technical Officer in December 1996. From November 1986 to May 1992, Dr.
Tarnowski was Director, Process and Product Development of Scios Nova Inc.
(formerly California Biotechnology Inc.), a company that develops recombinant
human proteins for therapeutic uses. Dr. Tarnowski received a Ph.D. in
Biochemistry from the University of Tennessee in 1979 and was a Postdoctoral
Fellow at the Roche Institute of Molecular Biology from 1979 to 1981.
5
<PAGE> 8
EDWARD F. KENNEY joined the Company as Vice President of Marketing and
Sales in February 1997. From 1987 to 1996 he served in various sales, marketing
and business development positions at Cetus Corporation and Chiron Corporation
(these two companies merged in 1991). From 1991 to 1996, Mr. Kenney was Vice
President, Marketing and Sales for Chiron Therapeutics, and in 1995 and 1996, he
served as general manager of that division's North American business. In 1986
and 1987, Mr. Kenney was a marketing manager in the cardiovascular therapy area
at Boehringer Ingelheim, and from 1978 to 1986, he served in various sales,
marketing and business development capacities at Bristol Myers Corporation. Mr.
Kenney received a B.S. degree in Zoology in 1974 and an M.S. degree in Natural
Resources in 1977 from Ohio State University.
MARK J. HANDFELT joined the Company as General Counsel and Vice
President of Law and Investor Relations in December 1997. He was appointed Vice
President of Law and Administration, General Counsel and Assistant Secretary in
June 1998. From May 1995 to November 1997, Mr. Handfelt was Merger and
Acquisition Counsel for Tribune Company, in Chicago, Illinois. Prior to May
1995, Mr. Handfelt was an associate at Vedder, Price, Kaufman & Kammholz in
Chicago, Illinois. Mr. Handfelt received a B.A. from the University of Iowa in
1985 and a J.D. from Northwestern University in 1988.
BOARD COMMITTEES AND MEETINGS
During the fiscal year ended March 31, 1998 ("Fiscal 1998"), the Board
of Directors held 13 meetings. The Board of Directors has an Audit Committee, a
Compensation Committee and a Stock Option Committee, and does not have a
Nominating Committee.
The Audit Committee consists of two directors, Mr. Green and Mr. Waite.
The Audit Committee is primarily responsible for approving the services
performed by the Company's independent accountants and reviewing their reports
regarding the Company's accounting practices and systems of internal accounting
controls. The Audit Committee held one meeting during Fiscal 1998.
The Compensation Committee consists of two directors, Mr. Lacob and Mr.
Waite. The Compensation Committee reviews and approves the Company's general
compensation policies, sets compensation levels for the Company's executive
officers and administers the Company's Restated 1989 Stock Option Plan. During
Fiscal 1998, the Compensation Committee held no meetings and acted by unanimous
written consent on nine occasions.
The Stock Option Committee consists of one director, Mr. Murdock. The
Stock Option Committee has authority to grant options under the Discretionary
Option Grant Program of the Company's Restated 1989 Stock Option Plan to
optionees other than officers and director-level employees of the Company.
During Fiscal 1998, the Stock Option Committee acted by unanimous written
consent on 90 occasions.
No director serving for the full fiscal year attended fewer than
seventy-five percent (75%) of the aggregate number of meetings of the Board of
Directors and meetings of the Committees of the Board on which he serves.
DIRECTORS' COMPENSATION
Outside directors receive cash compensation in the amount of $15,000
per year for service on the Board. This fee is conditioned upon attendance at
seventy-five percent (75%) of all Board meetings held during each year of Board
service, measured from the date of the Annual Meeting at which the Director is
elected by the stockholders, and is pro-rated for any year in which such
Director serves for less than one full year. In addition, outside Board members
receive options on shares of the Company's Common Stock pursuant to the
automatic grant program of the Company's Restated 1989 Stock Option Plan. Board
members are reimbursed for their expenses for each meeting attended. In
accordance with the automatic option grant program, on August 1, 1997, each of
Messrs. Lacob, Waite, Green and Anstey received an automatic option grant to
purchase 10,000 shares of Common Stock at the exercise price of $3.25 per share,
the fair market value on the date of grant. Each option will become exercisable
for all of the option shares one year after the grant date, provided that the
individual continues as a member of the Board and participates in seventy-five
percent (75%) of all Board meetings held during such one-year period. Each
option has a maximum term of 10 years measured from the grant date, subject to
earlier termination upon the individual's cessation of Board
6
<PAGE> 9
service. However, the option will become exercisable earlier for all of the
option shares upon an acquisition of the Company or its business, whether by
merger or asset sale. Directors who are employees of the Company will not
receive any automatic option grants but are eligible to receive options or stock
appreciation rights under the Company's Restated 1989 Stock Option Plan at the
discretion of the Compensation Committee.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table provides certain summary information concerning
compensation earned, for services rendered in all capacities to the Company and
its subsidiaries for each of the last three fiscal years, by the Company's Chief
Executive Officer and each of the four highest-paid executive officers of the
Company who earned more than $100,000 in salary and bonus (hereafter referred to
as the "named executive officers") for the fiscal year ended March 31, 1998:
<TABLE>
<CAPTION>
Long-term
Compensation
--------------------------- ---------------
Annual Compensation Awards
-------------- ------------ ---------------
Securities
Name and Year Underlying
Principal Ended Options All Other
Position (1) (2) March 31, Salary ($) (3) Bonus ($) (#) Compensation
---------------- --------- -------------- --------- --- ------------
<S> <C> <C> <C> <C> <C>
Richard D. Murdock 1998 $283,500 -- 50,000 (5) $5,657 (9)
President and Chief 325,000 (6)
Executive Officer 224,500 (7)
1997 $270,000 $67,500 (4) -- --
1996 $236,250 $56,288 174,500 (8) --
Larry G. Culver 1998 $215,000 -- 25,000 (5) $4,848 (9)
Executive Vice President, 200,000 (6)
Chief Operating Officer, 170,000 (7)
Chief Financial Officer 1997 $200,000 $50,000 (4) 15,000 --
and Assistant Secretary 1996 $179,000 $41,888 140,000 (8) --
S. Joseph Tarnowski, Ph.D. 1998 $182,000 -- 25,000 (5) $4,838 (9)
Senior Vice President and 75,000 (6)
Chief Technical Officer 157,000 (7)
1997 $173,017 $40,778 (4) 35,000 --
1996 $157,500 $35,438 50,000 --
Cindy A. Jacobs, Ph.D., M.D. 1998 $160,000 -- 25,000 (5) $3,585 (9)
Vice President of Clinical 50,000 (6)
Research 75,100 (7)
1997 $143,269 $34,743 (4) 15,000 --
1996 $130,245 $20,000 -- --
Edward F. Kenney 1998 $185,000 -- 25,000 (5) $2,200 (9)
Vice President of 25,000 (6)
Marketing and Sales 80,000 (7)
20,000
1997 $22,354 -- -- --
1996 -- -- -- --
</TABLE>
(1) The Company has one executive officer in addition to the named executive
officers, Mark J. Handfelt who joined the Company as General Counsel and Vice
President of Law and Investor Relations in December 1997. He was appointed Vice
President of Law and Administration, General Counsel and Assistant Secretary,
effective June 1, 1998.
7
<PAGE> 10
(2) Effective June 15, 1998, Mr. Culver resigned as Executive Vice President,
Chief Operating Officer, Chief Financial Officer and Assistant Secretary.
(3) Salary includes amounts deferred under the Company's Employees' Retirement
Plan.
(4) Includes compensation which the named executive officer earned during the
fiscal year ended March 31, 1997, payment of which was contingent upon the named
executive officer's continued employment with the Company on July 1, 1997 in the
following amounts: Mr. Murdock, $27,000; Mr. Culver, $20,000; Dr. Tarnowski,
$16,312; and Dr. Jacobs, $13,898.
(5) Options granted during the fiscal year ending March 31, 1999, under the
Stock Option Plan in lieu of payment of cash bonuses for fiscal year ended March
31, 1998.
(6) Options granted during the fiscal year ended March 31, 1998, upon
stockholder approval at the Company's 1997 Annual Meeting, made in connection
with repricing of options described in footnote 7.
(7) Includes certain options that were granted prior to the fiscal year ended
March 31, 1997, then subsequently cancelled and partially replaced with lower
priced options during the fiscal year ended March 31, 1998, including, in the
case of Mr. Murdock and Mr. Culver, repriced options described in footnote 8.
See also Option Repricing table on page 12.
(8) Includes certain options that were granted prior to the fiscal year ended
March 31, 1996, then subsequently cancelled and partially replaced with lower
priced options during such fiscal year.
(9) Compensation amount equal to the market value of Company Common Stock
contributed to account of named executive officer pursuant to the Company's 401k
Retirement Plan calculated on the date of such contribution.
8
<PAGE> 11
STOCK OPTIONS
The following table contains information concerning the grant of stock
options under the Company's Restated 1989 Stock Option Plan to the named
executive officers:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Individual Grants Potential Realizable Value at
Assumed Annual Rates of Stock
Price Appreciation for Option
Term (6)
- --------------------------------------------------------------------------------------------------------------------
# of
Securities
Underlying % of Total
Options Options
Granted in Granted to
Last Employees
Fiscal Year in Fiscal Exercise Expiration
Name (#) (1) Year Price ($)(4) Date (5) 0%($) 5% ($) 10% ($)
---- ------- ---- ------------ -------- ----- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
Richard D. Murdock, 325,000 26% 5.32 6/20/07 -- 1,087,359 2,755,581
President and Chief 224,500 (2) 17% (3) 5.32 6/20/07 -- 751,114 1,903,470
Executive Officer
Larry G. Culver, Executive 200,000 16% 5.32 6/20/07 -- 669,144 1,695,742
Vice President, Chief 170,000 (2) 13% (3) 5.32 6/20/07 -- 568,772 1,441,381
Operating Officer, Chief
Financial Officer and
Assistant Secretary
S. Joseph Tarnowski, 75,000 6% 5.32 6/20/07 -- 250,929 635,903
Ph.D., Senior Vice 157,000 (2) 12% (3) 5.32 6/20/07 -- 525,278 1,331,157
President and Chief
Technical Officer
Cindy A. Jacobs, Ph.D., 50,000 4% 5.32 6/20/07 -- 167,286 423,935
M.D., Vice President of 75,100 (2) 6% (3) 5.32 6/20/07 -- 251,264 636,751
Clinical Research
Edward F. Kenney, Vice 25,000 2% 5.32 6/20/07 -- 83,643 211,968
President of Marketing 80,000 (2) 6% (3) 5.32 6/20/07 -- 267,658 678,297
and Sales 20,000 2% 2.00 12/15/07 -- 25,156 63,750
</TABLE>
- ------------------------------
(1) Generally, each option granted to an employee of the Company becomes
exercisable for twenty-five percent (25%) of such option one year after the
employee's hire date ("Anniversary Date") with the balance becoming exercisable
in a series of 36 equal monthly installments thereafter. Options granted after
the Anniversary Date generally become exercisable in a series of 48 equal
monthly installments measuring from the grant date. The Compensation Committee
may, in its discretion, grant options with different vesting schedules than
described above. Each option granted is an incentive stock option to the extent
it does not exceed applicable limits set by the tax laws. For each option that
exceeds such limits, the number of shares underlying the option grant is
allocated between two options, the first an incentive stock option up to the
applicable limits and the second a non-statutory option for the balance of the
shares. In each case, vesting continues only so long as employment or an
approved consulting relationship with the Company or one of its subsidiaries
continues. To the extent not already exercisable, the options generally become
exercisable upon a sale, transfer or other disposition of all of the assets of
the Company or a merger or consolidation pursuant to which either (i) the
Company does not survive or (ii) ownership of more than fifty percent (50%) of
the voting power of the Company's stock is transferred to different holders,
unless the option is assumed or replaced with a comparable option by the
surviving entity or the option is replaced with a comparable cash incentive
program of the successor corporation based on the value of the option. In
addition, the Compensation Committee of the Board of Directors may accelerate
the vesting, upon such conditions as it may impose, in the event of (i) the
acquisition by one or more related parties of more than fifty percent (50%) of
the voting power of the Company's stock pursuant to a tender or exchange offer
not recommended by the Board of Directors or (ii) a change in the composition of
the Board of Directors over a period of not less than two years pursuant to
which persons who were directors at the beginning of the period (or nominated by
a majority of the continuing directors) cease to represent a majority of the
Board of Directors. Options granted to outside directors are described in
"Directors' Compensation" beginning on page 7.
(2) Options held by the named executive officer which were granted prior to or
during the fiscal year ended March 31, 1997, and which were repriced during the
fiscal year ended March 31, 1998. See also Option Repricing table
9
<PAGE> 12
on page 12.
(3) Percentages related to repriced options determined by calculating a
fraction, the numerator of which is the aggregate of all option grants to the
named executive officer prior to or during the fiscal year ended March 31, 1997,
and which such officer surrendered for repricing, and the denominator of which
is the aggregate of all option grants to all employees prior to or during the
fiscal year ended March 31, 1998 and which were surrendered for repricing.
(4) The exercise price may be paid in cash or pursuant to a cashless exercise
procedure under which the optionee provides irrevocable instructions to a
brokerage firm to sell the purchased shares and to remit to the Company, out of
the sale proceeds, an amount equal to the exercise price plus all applicable
withholding taxes. The Compensation Committee may also assist an optionee in the
exercise of an option by (i) authorizing a loan from the Company in a principal
amount not exceeding the aggregate exercise price plus any tax liability
incurred in connection with the exercise or (ii) permitting the optionee to pay
the option price in installments over a period of years upon terms established
by the Compensation Committee.
(5) The options are also subject to "limited stock appreciation rights" pursuant
to which certain options, to the extent exercisable and outstanding for at least
six months at the time of a "Hostile Takeover" in which more than fifty percent
(50%) of the shares acquired are acquired from parties other than directors and
executive officers of the Company, will automatically be canceled in return for
cash payment to the optionee equal to the difference between the then market
price of the stock subject to the option (or, if higher, the highest price paid
per share for stock by the acquirer in the Hostile Takeover) and the exercise
price.
(6) There is no assurance provided to any executive officer or any other holder
of the Company's securities that the actual stock price appreciation over the
10-year option term will be at the assumed five percent (5%) and ten percent
(10%) levels or at any other defined level. Unless the market price of the
Common Stock does in fact appreciate over the option term, no value will be
realized from the option grants made to the executive officers.
10
<PAGE> 13
The following table provides information, with respect to the named
executive officers, concerning the exercise of options during the last fiscal
year and unexercised options held as of the end of the last fiscal year:
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN 1998 FISCAL YEAR AND 1998 FISCAL YEAR END OPTION VALUES
- ---------------------------- ----------- ----------- ------------------------------- ------------------------------
Number of Unexercised Options
Shares Value at Fiscal Year-End (#) Value of Unexercised
Name acquired Realized in-the-Money Options at
on (Market FY-End (Market price of
exercise price at shares at FY-end ($3.63)
(#) exercise less exercise price)
less
exercise ($)
price) ($)
------------- ----------------- ------------ -----------------
Exercisable Unexercisable Exercisable Unexercisable
- ---------------------------- ----------- ----------- ------------- ----------------- ------------ -----------------
<S> <C> <C> <C> <C> <C> <C>
Richard D. Murdock 0 0 431,271 193,229 0 0
President and Chief
Executive Officer
- ---------------------------- ----------- ----------- ------------- ----------------- ------------ -----------------
Larry G. Culver 0 0 236,852 143,898 35,798 0
Executive Vice
President, Chief
Operating Officer, Chief
Financial Officer and
Assistant Secretary
- ---------------------------- ----------- ----------- ------------- ----------------- ------------ -----------------
S. Joseph Tarnowski, Ph.D. 0 0 148,269 83,731 0 0
Senior Vice President
and Chief Technical
Officer
- ---------------------------- ----------- ----------- ------------- ----------------- ------------ -----------------
Cindy A. Jacobs, Ph.D., M.D. 0 0 63,220 61,880 0 0
Vice President of
Clinical Research
- ---------------------------- ----------- ----------- ------------- ----------------- ------------ -----------------
Edward F. Kenney 0 0 38,855 86,145 10,188 22,413
Vice President of
Marketing and Sales
- ---------------------------- ----------- ----------- ------------- ----------------- ------------ -----------------
</TABLE>
11
<PAGE> 14
OPTION REPRICINGS
The following table provides information regarding the repricing of
certain options held by the Company's executive officers which were granted
prior to or during the fiscal year ended March 31, 1997, but were repriced
during the fiscal year ending March 31, 1998.
<TABLE>
<CAPTION>
----------------------------- ------------ ------------- ------------- ------------- ----------- -----------------
Number of
Securities Market Exercise Length of
Underlying Price of Price at New Original Option
Options Stock at Time of Exercise Term Remaining
Name Repriced or Time of Repricing Price at Date of
Date Amended Repricing or ($) Repricing or
(#) or Amendment Amendment
Amendment ($)
($)
----------------------------- ------------ ------------- ------------- ------------- ----------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Richard D. Murdock 6/20/97 50,000 5.32 10.75 5.32 4.86
President and Chief 6/20/97 174,500 5.32 10.50 5.32 7.99
Executive Officer
----------------------------- ------------ ---------- --------------- ------------- ------------ -----------------
Larry G. Culver 6/20/97 15,000 5.32 8.00 5.32 4.15
Executive Vice President, 6/20/97 90,000 5.32 10.50 5.32 7.99
Chief Operating Officer, 6/20/97 50,000 5.32 14.50 5.32 8.66
Chief Financial Officer 6/20/97 15,000 5.32 12.75 5.32 4.15
and Assistant Secretary
----------------------------- ------------ ---------- --------------- ------------- ------------ -----------------
S. Joseph Tarnowski, Ph.D. 6/20/97 72,000 5.32 10.75 5.32 4.86
Senior Vice President and 6/20/97 50,000 5.32 13.50 5.32 8.28
Chief Technical Officer 6/20/97 35,000 5.32 12.75 5.32 9.46
----------------------------- ------------ ---------- --------------- ------------- ------------ -----------------
Cindy A. Jacobs, Ph.D., M.D. 6/20/97 100 5.32 29.75 5.32 6.55
Vice President of 6/20/97 30,000 5.32 10.50 5.32 7.99
Clinical Research 6/20/97 30,000 5.32 16.50 5.32 8.78
6/20/97 15,000 5.32 6.48 5.32 9.78
----------------------------- ------------ ---------- --------------- ------------- ------------ -----------------
Edward F. Kenney 6/20/97 80,000 5.32 10.50 5.32 9.66
Vice President of
Marketing and Sales
============================= ============ ========== =============== ============= ============ =================
</TABLE>
COMPENSATION COMMITTEE REPORT ON REPRICED OPTIONS
In June 1997, the Compensation Committee determined that it was in the
best interest of the Company to cancel and replace the then-existing stock
option grants to the officers and other full-time employees of the Company with
exercise prices in excess of the then-current fair market value of the Company's
Common Stock. This decision was made after the Company received an adverse
ruling from the Court in a patent infringement case against plaintiffs Baxter
Healthcare Corporation, Becton Dickinson and Company and Johns Hopkins
University involving an antibody used by the Company in its CEPRATE(R) SC Stem
Cell Concentration System. This led to, among other things, a significant
decrease in the price of the Company's Common Stock. (See the Company's Annual
Report on Form 10-K for a more detailed discussion of this patent infringement
litigation.)
The objectives of the Company's Stock Option Plan are to promote the
interests of the Company by providing employees and certain consultants or
independent contractors an incentive to acquire a proprietary interest in the
Company and to continue to render services to the Company. It was the view of
the Compensation Committee that stock options with exercise prices substantially
above the current market price of the Company's Common Stock were viewed
negatively by Company employees and provided little, if any, equity incentive to
such employees. The Compensation Committee concluded that such option grants
seriously undermined the specific objectives of the Stock Option Plan and should
properly be canceled and replaced. In making this decision, the Compensation
Committee also considered the fairness of such a determination in relation to
other shareholders. In the opinion of the Committee, the stockholders' long-term
best interests were clearly served by the retention and motivation of the
employees and officers who remained at the Company following receipt of the
Court's ruling.
12
<PAGE> 15
For these reasons, the Committee decided that effective June 20, 1997
(the "Grant Date") all Company employees holding stock options with exercise
prices in excess of the fair market value of the Company's Common Stock could
receive a one-for-one replacement of their then-existing unexercised stock
options with a new exercise price set at $5.32 per share, the fair market value
of the Company's Common Stock on the Grant Date. The new lower-priced options
were subject to the same terms and vesting schedule as the associated
higher-priced options.
All replacement options for the Company's executive officers were
subject to a six-month waiting period before any repriced options could be
exercised. None of the Company's consultants, independent contractors or
non-employee members of the Board of Directors received any repriced stock
options.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors sets the base
salary of the Company's executive officers, approves individual bonus programs
for executive officers and administers the Company's Restated 1989 Stock Option
Plan under which grants may be made to executive officers and other key
employees. The following is a summary of policies of the Committee that affect
the compensation paid to executive officers, as reflected in the tables and text
set forth elsewhere in this Proxy Statement.
GENERAL COMPENSATION POLICY. The Committee's overall policy is to offer
the Company's executive officers competitive compensation opportunities based
upon their personal performance, the financial performance of the Company and
their contribution to that performance. One of the Committee's primary
objectives is to have a substantial portion of each officer's compensation
contingent upon the Company's performance as well as upon his or her own level
of performance. Each executive officer's compensation package is comprised of
three elements: (i) base salary that reflects individual performance and is
designed primarily to be competitive with salary levels in the industry, (ii)
annual variable performance awards payable in cash and tied to the achievement
of annual goals for each functional area established by the Committee and (iii)
stock-based incentive awards designed to strengthen the mutuality of interests
between the executive officers and the Company's stockholders. Generally, as an
officer's level of responsibility increases, a greater portion of his or her
total compensation will be dependent upon Company performance and stock price
appreciation rather than base salary.
FACTORS. Several important factors considered in establishing the
components of each executive officer's compensation package for the 1998 fiscal
year are summarized below. Additional factors were taken into account to a
lesser degree. The Committee may in its discretion apply entirely different
factors, such as different measures of financial performance, for future fiscal
years. However, it is presently contemplated that all compensation decisions
will be designed to further the overall compensation policy described above.
* BASE SALARY. The base salary for each officer is set on the basis of
personal performance, the salary levels in effect for comparable positions in
similarly situated companies within the biotechnology industry, and internal
comparability considerations. The Committee believes that the Company's most
direct competitors for executive talent are not limited to the companies that
the Company would use in a comparison for stockholder returns. Therefore, the
compensation comparison group is not the same as the industry group index in the
Performance Graph on page 15.
* ANNUAL INCENTIVE COMPENSATION. Annual bonuses, set as a targeted
percentage of salary, are earned by each executive officer on the basis of the
Company's achievement of corporate performance targets established by the
Committee at the start of the fiscal year and on achievement of personal
performance objectives set for each officer. Bonuses were weighted sixty-five
percent (65%) on achievement of corporate objectives, and thirty-five percent
(35%) on achievement of individual objectives. For fiscal year 1998, the
Compensation Committee determined that no executive bonuses would be paid as a
result of resource conservation efforts associated with an adverse ruling from
the U.S. District Court for the District of Delaware in a patent infringement
case against the Company brought by Baxter Healthcare Corporation, Becton
Dickinson and Company and The Johns Hopkins University.
* STOCK-BASED INCENTIVE COMPENSATION. The Committee approves periodic
grants of stock options to each of the Company's executive officers under the
Company's Restated 1989 Stock Option Plan. The grants are designed to align the
interests of each executive officer with those of the stockholders and provide
each individual with
13
<PAGE> 16
a significant incentive to manage the Company from the perspective of an owner
with an equity stake in the business. Each grant generally allows the officer to
acquire shares of the Company's Common Stock at a fixed price per share (the
market price on the grant date) over a specified period of time (up to 10
years), thus providing a return to the executive officer only if the market
price of the shares appreciates over the option term. The size of the option
grant to each executive officer is set at a level that the Committee deems
appropriate in order to create a meaningful opportunity for stock ownership
based upon the individual's current position with the Company, but also takes
into account comparable awards to individuals in similar positions in the
industry as reflected in external surveys, the individual's potential for future
responsibility and promotion over the option vesting period, and the
individual's personal performance in recent periods.
CEO COMPENSATION. In setting the compensation payable during fiscal
1998 to the Company's Chief Executive Officer, Richard D. Murdock, the Committee
used the same factors as described above for the executive officers.
EMPLOYEE RETENTION ARRANGEMENTS
In September 1997, the Company executed executive retention agreements
for each of Mr. Murdock, Mr. Culver, Dr. Tarnowski and Dr. Jacobs. Each
agreement provides that upon the occurrence of a "significant corporate event"
each executive will be entitled to a payment equal to 2.99 times such
executive's "base amount" as defined in Section 280G(b)(3) of the Internal
Revenue Code of 1986, as amended. All stock options granted by the Company to
the above named executives become immediately exercisable upon a "significant
corporate event." A "significant corporate event" means (a) the acquisition by
any person, entity or group of securities of the Company representing twenty
percent (20%) or more of the total equity interests of the Company, (b) a merger
or consolidation of the Company whether or not approved by the Board of
Directors of the Company, other than a merger or consolidation which would
result in the voting securities of the Company outstanding immediately prior
thereto continuing to represent at least fifty percent (50%) of the total voting
power represented by the voting securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation or (c) the
sale or disposition of assets of the Company approved by the Board of Directors
representing (i) at least twenty percent (20%) of the Company's total assets,
(ii) a value of at least $20 million or (iii) all or substantially all of the
tangible assets directly related to the manufacture or sale of the Company's
CEPRATE(R) Products. Each agreement terminates upon the earlier to occur of (i)
termination of executive's employment with the Company or (ii) September 30,
2000.
The Company's agreements with Mr. Murdock and Mr. Culver also provide
that in the event that such executive's employment with the Company is
terminated for any reason, the executive will be entitled to a severance payment
equal to six months of such executive's base salary. The Company is also
obligated to deposit with an escrow agent an amount equal to six months of such
executive's base salary. Beginning on the seventh month anniversary of such
executive's termination date and ending on the twelfth month anniversary of such
date, the escrow agent is obligated to disburse an amount, in the event such
executive has not obtained new employment, equal to one-sixth of such escrow
deposit, except to the extent the executive shall receive compensation for
services rendered to another person or entity, in which case the escrow agent is
obligated to reduce payments to the executive on a dollar-for-dollar basis in
respect of such other compensation.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee are Mr. Lacob and Mr. Waite.
Neither Mr. Lacob nor Mr. Waite was at any time during the year ended March 31,
1998, or any other time an officer or employee of the Company, except that Mr.
Lacob served as Acting President from March to November 1989.
14
<PAGE> 17
PERFORMANCE GRAPH
The following graph shows a comparison of the cumulative total
stockholder returns for the Company, the Standard & Poor's SmallCap 600 Index
and the Hambrecht & Quist Healthcare Index for the period from March 31, 1993
through March 31, 1998.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG CELLPRO, INC., THE S & P SMALLCAP 600 INDEX
AND THE HAMBRECHT & QUIST HEALTHCARE INDEX
<TABLE>
<CAPTION>
3/94 3/95 3/96 3/97 3/98
$ $ $ $ $
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
CELLPRO, INC. 149 71 100 41 23
S & P SMALLCAP 600 109 114 150 163 240
HAMBRECHT & QUIST HEALTHCARE 96 123 190 184 253
</TABLE>
* $100 invested on March 31, 1993, in CellPro Common Stock, the Standard &
Poor's SmallCap 600 Index and the Hambrecht & Quist Healthcare Index -- assuming
reinvestment of dividends.
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate future
filings, including this Proxy Statement, in whole or in part, the preceding
Compensation Committee Report on Executive Compensation and the preceding
Performance Graph shall not be incorporated by reference into any such filings,
nor shall such Report or graph be incorporated by reference into any future
filings.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During the fiscal year ended March 31, 1998, the Company granted
options to purchase shares of its Common Stock to its outside directors pursuant
to the automatic grant program of its Stock Option Plan.
Joshua L. Green, a member of the Board of Directors of the Company, is
a director in the law firm Venture Law Group, which acts as corporate counsel to
the Company.
The Company's Restated Certificate of Incorporation and Restated Bylaws
provide for indemnification of directors, officers and other agents of the
Company. Each of the current directors, and certain officers and agents of the
Company have entered into separate indemnification agreements with the Company.
15
<PAGE> 18
PROPOSAL TWO -- RATIFICATION OF INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed the firm of PricewaterhouseCoopers
LLP, independent accountants, to audit the financial statements of the Company
for the fiscal year ending March 31, 1999, and is asking the stockholders to
ratify this appointment.
In the event the stockholders fail to ratify the appointment, the Board
of Directors will reconsider its selection. Even if the selection is ratified,
the Board of Directors in its discretion may direct the appointment of a
different independent accounting firm at any time during the year if the Board
of Directors feels that such a change would be in the best interests of the
Company and its stockholders. The affirmative vote of the holders of a majority
of the Company's voting shares represented and voting at the Annual Meeting is
required to ratify the selection of PricewaterhouseCoopers LLP.
PricewaterhouseCoopers LLP has audited the Company's financial
statements annually since 1989. A representative of PricewaterhouseCoopers LLP
is expected to be present at the Annual Meeting, will have the opportunity to
make a statement if he desires to do so, and will be available to respond to
appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE
RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP TO SERVE AS THE
COMPANY'S INDEPENDENT ACCOUNTANTS FOR THE FISCAL YEAR ENDING MARCH 31, 1999.
ANNUAL REPORT
A copy of the Annual Report of the Company for the fiscal year ended
March 31, 1998, will be mailed with this Proxy Statement on or about August 17,
1998 to all stockholders entitled to notice of and to vote at the Annual
Meeting. The Annual Report is not incorporated into this Proxy Statement and is
not considered proxy soliciting material.
FORM 10-K
The Company files an Annual Report on Form 10-K with the Securities and
Exchange Commission. Stockholders may obtain a copy of this report, without
charge, by request to the Vice President of Law and Administration, at the
Company.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who own more than ten percent
(10%) of the Company's Common Stock, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission ("SEC"). Officers,
directors and greater-than-ten-percent shareholders are required by SEC
regulations to furnish the Company with copies of all Section 16(a) forms they
file.
Based solely on its review of the copies of such forms received by it,
or written representations from certain reporting persons that no Form 5s were
required for such persons, the Company believes that all filing requirements
applicable to its officers, directors, and greater-than-ten-percent beneficial
owners during the period from April 1, 1997 to March 31, 1998 have been
satisfied.
16
<PAGE> 19
OTHER MATTERS
The Company knows of no matters that will be presented for
consideration at the Annual Meeting other than the matters set forth in this
Proxy Statement. If any other matters properly come before the Annual Meeting,
it is the intention of the persons named in the enclosed form of Proxy to vote
the shares they represent as the Board of Directors may recommend. Discretionary
authority with respect to such other matters is granted by the execution of the
enclosed Proxy.
THE BOARD OF DIRECTORS
17
<PAGE> 20
- -------------
Please mark
X votes as in this
example
- -------------
The Board of Directors recommends a vote FOR each of the directors listed below
and a vote FOR the other proposals. This Proxy, when properly executed, will be
voted as specified below. This Proxy will be voted FOR the election of the
directors listed below and FOR the other proposals if no specification is made.
1. To elect the following directors to serve until the next annual meeting of
stockholders or until their successors are elected and qualified:
NOMINEES: Kenneth W. Anstey, Larry G. Culver, Joshua L. Green, Joseph S. Lacob,
Richard D. Murdock, Charles P. Waite, Jr.
FOR WITHHOLD AUTHORITY TO VOTE
/__/ /__/
/__/ For all nominees except as noted above by striking out the applicable
name(s)
2. To ratify the Board of Directors' selection of PricewaterhouseCoopers LLP to
serve as the Company's independent accountants for the fiscal year ending March
31, 1999.
FOR AGAINST ABSTAIN
/__/ /__/ /__/
3. To transact such other business as may properly come before the Annual
Meeting or any adjournment or postponement thereof.
FOR AGAINST ABSTAIN
/__/ /__/ /__/
MARK HERE FOR ADDRESS CHANGE /__/ _________________________________
AND PROVIDE NEW ADDRESS
_________________________________
_________________________________
Please sign your name:
Signature:_________________________________ Date:____________________
Signature:_________________________________ Date:____________________
<PAGE> 21
CELLPRO INCORPORATED
ANNUAL MEETING OF STOCKHOLDERS, OCTOBER 7, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
CELLPRO, INCORPORATED
PROXY
The undersigned revokes all previous proxies, acknowledges receipt of the Notice
of the Annual Meeting of Stockholders to be held October 7, 1998 and the Proxy
Statement and appoints Richard D. Murdock the Proxy of the undersigned, with
full power of substitution, to vote all shares of Common Stock of CellPro,
Incorporated (the "Company") which the undersigned is entitled to vote, either
on his or her own behalf or on behalf of any entity or entities, at the Annual
Meeting of Stockholders of the Company to be held at the Company's offices at
22215 26th Avenue, S.E., Bothell, WA 98021, on Wednesday, October 7, 1998 at
10:00 a.m. (the "Annual Meeting"), and at any adjournment or postponement
thereof, with the same force and effect as the undersigned might or could do if
personally present thereat. The shares represented by this Proxy shall be voted
in the manner set forth on the reverse side.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE) SEE REVERSE SIDE
