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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14(a))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
IXION BIOTECHNOLOGY, INC.
Payment of Filing Fee
[x] $125 per Exchange Act Rules.
[ ] $500 per each party to the controversy Pursuant to Exchange Act Rules.
[ ] Fee Computed on table below per Exchange Act Rules.
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 Rules:
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Check box if any part of the fee is offset as provided by Exchange Act 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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<PAGE>
IXION
Notice of Annual Meeting of Stockholders
June 12, 1998
The annual meeting of stockholders of Ixion Biotechnology, Inc, a
Delaware corporation (the "Company"), will be held at the Newark Airport
Mariott, Newark International Airport, Newark, NJ 07114, on June 12, 1998 at
10:00 a.m., EDT, to:
1. Elect five directors for a term of one year;
2. Act upon the ratification of the designation of Coopers & Lybrand
L.L.P. to audit the books and records of the Company for 1998.
3. Transact such other business as may properly come before the meeting
or any adjournments or postponements thereof.
Only stockholders of record as of the close of business on April 13,
1998, will be entitled to notice of the annual meeting and to vote at the annual
meeting and any adjournments or postponements thereof. If you are a stockholder
of record and plan to attend the meeting, please return the proxy card with the
"Annual Meeting" box marked. Admission to the meeting will be on a first-come,
first served basis. Stockholders will be admitted upon verification of ownership
at the door.
By Order of the Board of Directors,
Mary Trew
Secretary
Alachua, Florida
April 30, 1998
- --------------------------------------------------------------------------------
IMPORTANT
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
If you do not expect to attend the meeting in person, please complete,
date, and sign the enclosed proxy and return it without delay in the enclosed
envelope, which requires n additional postage if mailed in the United States.
- --------------------------------------------------------------------------------
<PAGE>
IXION BIOTECHNOLOGY, INC.
12085 Research Drive
Alachua, FL 32615
April 30, 1998
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Ixion Biotechnology, Inc. (the "Company"
or "Ixion"), for use at the 1998 annual meeting of stockholders on June 12, 1998
at 10:00 a.m. EDT, and at any postponements or adjournments thereof. This proxy
statement and the accompanying proxy card are expected to be the first
distributed to stockholders on or about April 30, 1998.
The cost of solicitation of proxies will be borne by the Company. In
addition to the use of mails, proxies may be solicited by telephone by officers,
directors, and regular employees of the Company, none of whom will be specially
compensated for such services.
The Company's annual report to stockholders for the fiscal year ended
December 31, 1997, including audited financial statements, is included herewith,
but does not constitute a part of this proxy statement.
VOTING AT THE MEETING
Holders of common stock of the Company, par value $.01 per share
("Common Stock"), of record at the close of business on April 13, 1998 are
entitled to vote at the meeting. As of that date, there were 2,472,194 shares of
Common Stock outstanding. Each stockholder entitled to vote shall have the right
to one vote for each share outstanding in such stockholder's name.
The Company presently has no other class of stock outstanding and
entitled to be voted at the meeting. The presence in person or by proxy of
stockholders entitled to cast a majority of all votes entitled to be cast at the
meeting constitutes a quorum.
Shares cannot be voted at the meeting unless the holder of record is
present in person or by proxy. The enclosed proxy is a means by which a
stockholder may authorize the voting of his or her shares at the meeting. The
shares of Common Stock represented by each properly executed proxy will be voted
at the meeting in accordance with each stockholder's directions. Stockholders
should specify their choices by marking the appropriate boxes on the enclosed
proxy; if no choice has been specified, the shares will be voted as recommended
by the Board of Directors. If any other matters are properly presented at the
meeting for action, the proxy holders will vote the proxies (which confer
discretionary authority to vote on such matters) in accordance with their
judgement.
Execution of the accompanying proxy will not affect a stockholder's
right to attend the meeting and vote in person. Any stockholder giving a proxy
has a right to revoke it by giving written notice of revocation to the Secretary
of the Company, or by delivering a subsequently executed proxy, at any time
before the proxy is voted.
Your proxy vote is important. Accordingly, please complete, sign, and
return the accompanying proxy whether or not you plan to attend the meeting.
12
ELECTION OF DIRECTORS
Proxies in the accompanying form will be voted at the meeting, unless
authority to do so is withheld, in favor of the election as directors of the
nominees named below.
The stockholders will elect five directors at the 1998 annual meeting
for a term of one year expiring at the 1999 annual meeting of the stockholders,
and until the election and qualification of successors (or until earlier removal
or resignation). In the event one or more of the named nominees is unable to
serve, the persons designated as proxies may cast votes for other persons as
substitute nominees. The Board of Directors has no reason to believe that any of
the nominees named below will be unavailable, or, if elected, will decline to
serve. Directors will be elected by a plurality of the votes cast at the annual
meeting. Withheld votes will not count toward such nominee's achievement of a
plurality.
Certain information is set forth below for each nominee for director. All
of the nominees are presently directors and were previously elected by the
stockholders, except Dr. Karl-E. Arfors, who has been nominated to fill a
newly-created vacancy on the Board.
The Board of Directors unanimously recommends a vote FOR each of the
nominees.
Nominees for Director
<TABLE>
<CAPTION>
Year First
Principal Occupations During Past Five Became
Name of Director Age Years and Certain Directorships Director
- ------------------- -- ------------------------------------------------------------------------ -----------
- ------------------- -- ------------------------------------------------------------------------ -----------
<S> <C> <C> <C>
Weaver H. Gaines 54 Mr. Gaines is one of the founders of the Company and has been its 1993
Chairman and Chief Executive and a director since inception. He was
also President from April 1993 to April 1994. From April to November
1992, he was a member of Bush/Quayle 92. He is also Chairman of
BIO+Florida, the Florida biotechnology trade
association, and a director of AquaGene, Inc.
- ------------------- -- ------------------------------------------------------------------------ -----------
- ------------------- -- ------------------------------------------------------------------------ -----------
David C. Peck 50 Mr. David Peck is one of the founders of Ixion and has been a director 1993
since inception. Since April 1994, he has served as President and
Chief Financial Officer. From September 1995, Mr. Peck has also been
Chief Executive Officer and Chief Operating Officer of BACOMPT, a
printing company located in Carmel, Indiana. From 1992 until April
1994, he was the Chief Operating Officer of NEXCOM, the Navy Exchange
Service Command, a multi-billion dollar retail business. Mr. Peck is
the brother of Dr. Peck, the Company's Chief Scientist.
- ------------------- -- ------------------------------------------------------------------------ -----------
- ------------------- -- ------------------------------------------------------------------------ -----------
David M. Margulies 46 Dr. Margulies is currently Executive Vice President and Chief 1994
Scientist of Synetic, Inc., a publicly-held company. From July 1996
to January 1997, Dr. Margulies was a founder and Chairman and CEO of
CareAgents, Inc, a developer of Internet-based clinical commerce
applications, which was acquired by Synetic in January 1997. From
1991 to July 1996, Dr. Margulies was a Director, an Executive Vice
President, and Chief Scientist of Cerner
Corporation, a publicly-held company.
- ------------------- -- ------------------------------------------------------------------------ -----------
- ------------------- -- ------------------------------------------------------------------------ -----------
Vincent P. Mihalik 47 Mr. Mihalik is presently Executive Vice President, Diagnostics 1995
Division, F. Hoffmann-LaRoche, the parent company of Boehringer
Mannheim Group. Until October of 1996, he was Senior Vice President
Global Marketing for the Diabetes Care Business Unit of Boehringer
Mannheim Corporation. He joined Boehringer Mannheim in 1990 and held
the position of President, Patient Care Systems Division.
- ------------------- -- ------------------------------------------------------------------------ -----------
- ------------------- -- ------------------------------------------------------------------------ -----------
Karl-E. Arfors 61 Dr. Arfors has been President of Experimental Medicine, Inc., since Nominee
1993. His professional career includes positions with the Liposome
Company and Pharmacia AB, as well as President of the La Jolla
Institute for Experimental Medicine.
- ------------------- -- ------------------------------------------------------------------------ -----------
</TABLE>
Committees of the Board of Directors
The Bylaws provide that the Board may designate an executive committee
and other committees, each of which shall consist of one or more directors, and
the Board annually elects from its members of an Audit and Benefits Committee
and an Executive Committee.
Audit and Benefits Committee. The members of the Audit and Benefits
Committee are Dr. Margulies and Mr. Mihalik, non-employee directors, and Mr.
Peck, the Company's President. Upon the election of Dr. Arfors as a director,
Dr. Arfors will be appointed to this Committee in place of Mr. Peck, such that
the Committee will thereafter be composed exclusively of non-employee directors.
This Committee, which met twice during 1997, recommends to the Board the
engagement of independent auditors, reviews the professional services to be
rendered by the independent auditors, the scope of their audit, their fees, and
the results of their engagement. The independent auditors meet periodically with
the Committee and have unrestricted access to the Committee. The Committee is
also responsible for developing and executing plans for the compensation of the
executive officers. Additionally, the Committee administers the terms and
provisions of the 1994 Stock Option Plan (the "Option Plan") and the Board
Retainer Plan, including the determination of the individuals eligible to
receive awards, the individuals to whom awards should be granted, the nature of
the awards to be granted, and the exercise price, vesting schedule, and term of
options or awards to be granted.
Executive Committee. The members of the Executive Committee are Mr. Gaines
and Mr. Peck. The Executive Committee has all of the powers of the Board
permitted under the Delaware corporation law. There were no meetings of the
Executive Committee during 1997, and all of its actions were taken by unanimous
consent.
Board Meetings and Attendance of Directors
The Board of Directors had three meetings in 1997. All directors
attended more than 75% of the aggregate of (i) the total number of meetings of
the Board held while they were members, and (ii) the total number of meetings
held by all Committees of the Board.
Compensation of Directors
Employees and consultants of the Company who are also directors of the
Company receive no additional remuneration for fulfilling their role as
director.
<PAGE>
Pursuant to the Board Retainer Plan, as amended, non-employee directors
receive a grant of 5,000 shares of Common Stock upon election to the Board, and,
during the duration of the Plan, will receive 1,000 shares annually thereafter,
immediately following the annual meeting at which they are reelected to the
Board. They also receive reimbursement of their expenses to attend Board
meetings. In June of 1997, Dr. Margulies and Mr. Mihalik each received 1,000
shares under the Board Retainer Plan. In addition, non-employee directors are
eligible to receive options under the terms of the 1994 Stock Option Plan as
determined by the Audit and Benefits Committee. Non-employee directors who are
members of the Audit and Benefit Committee may not be awarded discretionary
option grants, but will receive a grant of options to purchase 2,000 shares of
the Company's Common Stock upon appointment to the Committee, and options to
purchase an additional 2,500 shares annually thereafter. Options vest over a
five-year period, with an exercise price equal to the fair market value of the
Company's Common Stock on the date of grant. In 1997, Dr. Margulies and Mr.
Mihalik each received an automatic annual grant under the 1994 Stock Option Plan
of a nonqualified option to purchase 2,500 shares of Common Stock at an exercise
price of $10.00 per share.
Security Ownership of Directors and Officers
The following table sets forth certain information with respect to
beneficial ownership of the Company's Common Stock as of February 28, 1998, by
the Company's executive officers and by all directors and officers of the
Company as a group.
Name Number of Shares Percent
- ---------------------------------- ------------------------------ -------------
- ---------------------------------- ------------------------------ -------------
Ammon B. Peck, Ph.D............... 655,000 (1)(4) 26.2%
- ---------------------------------- ------------------------------ -------------
- ---------------------------------- ------------------------------ -------------
Weaver H. Gaines.................. 553,512 (2)(4) 22.2%
- ---------------------------------- ------------------------------ -------------
- ---------------------------------- ------------------------------ -------------
David C. Peck..................... 417,234 (3)(4) 16.7%
- ---------------------------------- ------------------------------ -------------
- ---------------------------------- ------------------------------ -------------
David M. Margulies, M.D........... 18,917 (4) (5)
- ---------------------------------- ------------------------------ -------------
- ---------------------------------- ------------------------------ -------------
Vincent P. Mihalik................ 12,742 (4) (5)
---------- ---
- ---------------------------------- ------------------------------ -------------
- ---------------------------------- ------------------------------ -------------
All officers and directors
as a group (6 persons) .......... 1,663,404 (4) 66.6%
============= =====
- ---------------------------------- ------------------------------ -------------
(1) Includes 50,000 shares held by Dr. Peck's wife in trust for her
brothers as to which Dr. Peck disclaims beneficial ownership.
(2) Includes 40,000 shares held by WABS Associates, a general partnership
composed of Mr. Gaines and his three siblings. Mr. Gaines disclaims beneficial
ownership of 30,000 of such shares.
(3) Includes 1,000 shares and 250 warrants held by Mr. Peck's wife, as to
which Mr. Peck disclaims beneficial ownership.
(4) Includes shares which could be acquired within 60 days of February 28,
1998 through the exercise of stock options or the conversion of the Company's
Unsecured Convertible Debt as follows: Dr. Peck (5,000 shares), Mr. Gaines
(5,952 shares), Mr. Peck (12,250 shares), Dr. Margulies (2,917 shares), Mr.
Mihalik (1,742 shares), and an additional officer (6,000 shares).
(5) Less than 1.0% (including shares which could be acquired within 60 days
of February 28, 1998 through the exercise of outstanding options). Percent is
calculated based on actual shares outstanding plus shares exercisable by
officers or directors within 60 days.
Security Ownership of Certain Beneficial Owners
Set forth below is certain information with respect to those persons
who are known to the Company to own beneficially more than five percent of the
Company's Common Stock as of February 28, 1998.
- ---------------------------------- ------------------------------ ------------
Name and Address of (1) Number of Shares Percent
Beneficial Owners
- ---------------------------------- ------------------------------ -------------
Ammon B. Peck, Ph.D............... 655,000 (2)(5) 26.2%
- ---------------------------------- ------------------------------ -------------
- ---------------------------------- ------------------------------ -------------
Weaver H. Gaines.................. 553,512 (3)(5) 22.2%
- ---------------------------------- ------------------------------ -------------
- ---------------------------------- ------------------------------ -------------
David C. Peck..................... 417,234 (4)(5) 16.7%
- ---------------------------------- ------------------------------ -------------
(1) Address is 12085 Research Drive, Alachua, FL 32615.
(2) Includes 50,000 shares held by Dr. Peck's wife in trust for her
brothers as to which Dr. Peck disclaims beneficial ownership.
(3) Includes 40,000 shares held by WABS Associates, a general partnership
composed of Mr. Gaines and his three siblings. Mr. Gaines disclaims beneficial
ownership of 30,000 of such shares.
(4) Includes 1,000 shares and 250 warrants held by Mr. Peck's wife, as to
which Mr. Peck disclaims beneficial ownership.
<PAGE>
(5) Includes shares which could be acquired within 60 days of February 28,
1998 through the conversion of the Company's Unsecured Convertible Debt as
follows: Dr. Peck (5,000 shares), Mr. Gaines (5,952 shares), and Mr. Peck
(12,250 shares). Percent is calculated based on actual shares outstanding plus
shares exercisable by officers or directors within 60 days.
The Company is not aware of any arrangements, including pledges of
securities, the execution of which may at a subsequent time result in a change
in control of the Company.
Summary Compensation Table
The following table summarizes the compensation of those persons who
were, at December 31, 1997, the Company's Chairman and Chief Executive Officer,
its President, its Senior Vice President and Chief Scientist, and its Vice
President, Operations and Regulatory Affairs, for the years ended December 31,
1995, 1996, and 1997.
<TABLE>
<CAPTION>
Summary Compensation Table
- -------------------------------------- ----------------------------- ------------------------------------------
Annual Compensation Long-Term Compensation Awards
- -------------------------------------- ----------------------------- ------------------------------------------
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
Deferred Cash All Restricted Securities
Name Year Salary Salary Other Stock Awards Underlying Options/SARs
---- ---- ------ ------ ----- ------------ -----------------------
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
<S> <C> <C> <C> <C> <C> <C>
Weaver H. Gaines (1)...... 1995 $31,250 $43,750 $0 $0 0
Chairman and CEO 1996 $25,000 $60,000 $0 $0 0
1997 $23,750 $71,250 $0 $0 0
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
David C. Peck (2)......... 1995 $35,000 $25,000 $0 $0 0
President & CFO 1996 $25,000 $35,000 $0 $0 0
1997 $20,000 $40,000 $0 $0 0
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
Ammon B. Peck (3)......... 1995 $ 7,500 $22,500 $0 $0 0
Sr. V.P. & Chief Scientist 1996 $ 5,000 $35,000 $0 $0 0
1997 $16,667 $33,333 $0 $0 0
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
John L. Tedesco, MS.......
V.P. Operations & Reg. 1997 $0 $58,420 $0 $0 6,000
Affairs
- ------------------------------ ------- ---------- ---------- ------- ---------------- -------------------------
</TABLE>
(1) Mr. Gaines joined the Company at its inception in March 1993.
(2) Mr. Peck joined the Company in April 1994. He is paid a consulting fee
rather than a salary. (3) Dr. Peck began consulting for the Company on June 1,
1994. He is paid a consulting fee rather than a salary.
(4) Mr. Tedesco joined the Company in January 1997 and resigned in April of
1998. Brandywine Consulting Group, of which he is president, was paid a
consulting fee based entirely on his services.
Executive Compensation and Employment Arrangements
In August, 1994, the Board of Directors adopted an annual incentive
compensation plan (the "Annual Bonus Plan"), administered by the Audit and
Benefits Committee, pursuant to which officers and key consultants may be
awarded cash bonuses (deferred unless the Company has sufficient cash to pay
such bonuses prudently), based on the financial performance of the Company. For
1997, the Audit and Benefits Committee determined that awards could range up to
50% of a participant's base salary or consulting fee, depending on their rank.
No awards under the Annual Bonus Plan were made for 1996. Awards, if any, for
1997, will be determined following the 1998 annual meeting.
<PAGE>
In January, 1994, the Board of Directors adopted a Deferred
Compensation Plan for officers, key employees, and key consultants of the
Company, permitting such persons to defer the receipt of all or a portion of
their compensation. Under the Deferred Compensation Plan, an unfunded deferred
compensation account is established for each participant. The only obligation of
the Company regarding such account is to make the payments when they become
payable if the Company has sufficient cash to do so prudently. Any amount
credited to such account is solely for record-keeping, and is not considered to
be held in trust or in escrow or in any way vested in the participant. Payments
under the Deferred Compensation Plan are to be made only upon termination of
employment (which may be by death, disability, retirement, or otherwise) and may
be in a lump sum or as an annuity. In the case of certain senior participants,
if termination is by death or dismissal without cause, at the election of the
participant, the balance in his account may be converted into Common Stock of
the Company at a price per share not greater than the lowest price per share
(adjusted for stock splits, stock dividends, the issuance of convertible
securities, warrants, or options, or other dilution) at which shares of the
Company's Common Stock have been issued (or agreed to be issued) at any time in
the 365 days preceding the date of termination. A termination is deemed without
cause for substantially the same occurrences described under "Employment
Agreements," below. Amounts in the account bear interest, compounded annually,
at a rate established by the Board of Directors, which was 8.0% during 1997.
Effective January 1, 1998, the rate established by the Board is 6.54%. A portion
of compensation and all interest during 1997 were deferred by the officers.
The Company has entered into written employment agreements (the
"Employment Agreements") with two of its executive officers, Messrs. Gaines and
D. Peck (who also has a consulting agreement with the Company which essentially
duplicates the terms of the Employment Agreement), which provide for initial
annual base compensation of $90,000 and $60,000, respectively. Base compensation
levels are to be reviewed at least annually. Upon a determination by the Board
that the Company has obtained adequate financing, base compensation may be
increased to not less than the average cash base compensation reported by an
appropriate salary survey (as determined by the Board) for executive officers at
biotechnology companies of equivalent size and status. The effective date of the
Employment Agreements is August 31, 1994, and the current term of each expires
December 31, 1999, renewable automatically for one year terms unless either
party gives written notice of termination at least 92 days before the end of the
then current term. Annual bonus compensation, if any, shall be determined by the
Board of Directors.
The Employment Agreements provide that the Company has the right to
terminate the executive at any time upon 60 days' notice. A termination for
cause (as defined in the Employment Agreements) is effective without further
benefits, upon a finding by the Board of Directors. Termination without cause
(as defined in the Employment Agreements), or termination by the executive for
"Good Reason" (as defined in the Employment Agreements) requires the Company to
pay severance benefits equal to the aggregate base salary at the then current
rate payable through the end of the then current term, but not less than two
times the executive's base compensation. In addition, the Company must pay
annual bonus compensation calculated in accordance with the Employment
Agreements. Finally, all restricted stock is immediately vested, all outstanding
stock options are immediately vested and accelerated, and the executives have
the right to purchase Common Stock of the Company pursuant to the terms of the
Subordinated Note Agreement and the Deferred Compensation Plan. Termination is
deemed without cause or for "Good Reason" if (i) there is a reduction in the
executive's annual aggregate compensation or benefits, (ii) there is an
involuntary diminution in the executive's position, powers, authority, duties,
or responsibilities, or (iii) there is a material breach of the Employment
Agreement by the Company.
The Employment Agreements contain covenants that an executive must
refrain from engaging in any business competitive with the Company during the
period of his employment and for six months after termination or resignation and
must not use, disclose or make accessible to any third party any proprietary
information of the Company during the period of his employment, or thereafter.
All inventions relating to oxalate technology, or biotechnology generally
conceived while rendering services to the Company must be assigned to the
Company.
The Company has an exclusive consulting agreement expiring in 2000 with
Dr. Ammon B. Peck for consulting services relating to the Company's business and
technology. The fee is $50,000 per year. Dr. Peck is obligated to devote 48 days
of service per year to the Company, including travel time, and has agreed not to
engage in competitive activities with Ixion during the term of the agreement, or
for two years thereafter. Subject to the provisions of Dr. Peck's employment
agreement with the University of Florida, Dr. Peck has agreed to assign to the
Company any inventions or intellectual property rights developed by him while
performing services under the agreement. The agreement may be canceled by either
party on 30 days' written notice.
<PAGE>
Option Tables
The following table sets forth certain information concerning all stock
option grants to the Company's executive officers to date.
<TABLE>
<CAPTION>
Option/SAR Grants in Last Fiscal year
(Individual Grants)
- --------------------------------- -------------------------- ------------------------ ---------------- -------------
Number of Securities % of Total
Underlying Options/SARs Options/SARs Granted Exercise Price Expiration
Name Granted to Employees in Fiscal Per Share Date
Year
- --------------------------------- -------------------------- ------------------------ ---------------- -------------
- --------------------------------- -------------------------- ------------------------ ---------------- -------------
<S> <C> <C> <C> <C>
John L. Tedesco (1) 3,000 33.7% $5.00 2/10/02
VP Operations & Reg. Affairs 3,000 33.7% $5.00 10/23/02
- --------------------------------- -------------------------- ------------------------ ---------------- -------------
</TABLE>
(1) Warrants were granted to Brandywine Consulting, Inc., of which Mr.
Tedesco was President.
The following table sets forth certain information concerning option
exercises and option holdings under the Plan as of December 31, 1997 with
respect to each of the Company's executive officers.
<TABLE>
<CAPTION>
Aggregated Options/SAR Exercises in Last Fiscal Year and
Fiscal Year-end Option/SAR Values
- ----------------------------------------- ------------------------------------ -------------------------------------
Number of Securities Underlying Value of Unexercised In-The-Money
Unexercised Options/SARs at FY-end Options/SARs at FY-end
Name Exercisable/Unexerciseable Exercisable/Unexerciseable
- ----------------------------------------- ------------------------------------ -------------------------------------
- ----------------------------------------- ------------------------------------ -------------------------------------
<S> <C> <C>
John L. Tedesco (1) 6,000/0 $60,000/$0 (1)
VP Operations & Reg. Affairs
- ----------------------------------------- ------------------------------------ -------------------------------------
</TABLE>
(1) Warrants were granted to Brandywine Consulting, Inc., of which Mr.
Tedesco was President. Value is based on the public offering price of the
Company's Units. There is no trading market for the Company's Common Stock.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTION
The following are transactions since January 1, 1997 between the
Company and any officer, director, director nominee, or the imediate family of
any such persons.
On April 16, 1996, the Chairman and Chief Executive Officer and the
President of the Company each entered into an agreement to extend the Company up
to $25,000 in the form of a bridge loan. The loans bear cash interest at the
rate 8% (which can be reset annually, at the election of either party, to the
prime rate in effect on January 1 of any given year plus 3%), paid monthly and
upon repayment of the principal. In addition, the Chairman, on June 21, 1996,
agreed to increase his loan commitment to an amount up to $150,000, if
necessary, to enable the Company to continue operations. $75,000 was borrowed
and was outstanding under these facilities at December 31, 1997.
In December 1996, the Company entered into a consulting agreement with
Brandywine Consulting, Inc., a company whose President, John L. Tedesco, was
also Vice President - Operations and Regulatory Affairs of the Company. During
1997, Brandywine Consulting was paid $58,420, was reimbursed for Mr. Tedesco's
expenses, and received upon the achievement of certain milestones, five-year
warrants for an aggregate of 6,000 shares of Common Stock, exercisable at $5.00
per share. Mr. Tedesco resigned as Vice President on April 4, 1998.
In December 1997, the Company engaged the services of a printer in
connection with its public offering. The printer is managed and partly owned by
the Company's President. Through December 31, 1997, the printer had not rendered
any service, and accordingly had not been paid.
<PAGE>
It is the Company's policy that any material transactions or loans, and
any forgiveness of loans, between officers, directors, or material shareholders
and the Company must be approved by a majority of the Company's independent
directors, if any, who do not have an interest in the transaction. Furthermore,
all such transactions or loans must be entered into on terms that are no less
favorable to the Company than those that can be obtained from unaffiliated third
parties. All of the above transactions were entered into in compliance with the
Company's policy.
DESIGNATION OF AUDITORS
Upon the recommendation of the Audit and Benefits Committee, the Board
of Directors has designated Coopers & Lybrand L.L.P. to audit the books and
accounts of the Company for the year ending December 31, 1998, and will offer a
resolution at the annual meeting to ratify the designation.
OTHER BUSINESS
The Board of Directors is not aware of any matters not set forth herein
that may come before the meeting. If, however, further business properly comes
before the meeting, the persons named in the proxies will vote the shares
represented thereby in accordance with their judgement.
1999 ANNUAL MEETING OF SHAREHOLDERS
If any stockholder intends to present a proposal for consideration at
the 1999 annual meeting of stockholders, such proposal must be received by the
Company not later than January 1, 1999, for inclusion, pursuant to Rule 14a-8
under the Exchange Act, in the Company's proxy statement for such meeting.
<PAGE>
PROXY
IXION BIOTECHNOLOGY, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 12, 1998
The undersigned hereby appoints Weaver H. Gaines or David C. Peck, or
either of them, as attorney and proxy of the undersigned, with full power of
substitution and resubstitution, to vote all of the shares of Common Stock of
Ixion Biotechnology, Inc. (the "Company") which the undersigned may be entitled
to vote at the Annual Meeting of Stockholders to be held at the Newark Airport
Mariott, Newark International Airport, Newark, NJ 07114, on June 12, 1998,
commencing at 10:00 a.m., local time, and at any and all postponements and
adjournments thereof, with all powers that the undersigned would possess if
personally present, upon and in respect of the following matters and in
accordance with the following instructions.
UNLESS A CONTRARY DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED FOR
ALL NOMINEES FOR DIRECTOR LISTED IN PROPOSAL 1 AND FOR PROPOSAL 2, AS MORE
SPECIFICALLY DESCRIBED IN THE PROXY STATEMENT. IF SPECIFIC INSTRUCTIONS ARE
INDICATED, THIS PROXY WILL BE VOTED IN ACCORDANCE THEREWITH.
YOU MAY REVOKE THIS PROXY AT ANY TIME PRIOR TO THE VOTE AT THE ANNUAL
MEETING.
PLEASE COMPLETE, DATE, AND SIGN THIS PROXY AND
RETURN IT IN THE ACCOMPANYING ENVELOPE.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES FOR DIRECTOR LISTED
BELOW AND A VOTE FOR PROPOSAL 2
1. To elect five directors to hold office until the 1999 Annual Meeting of
Stockholders.
Nominees: Weaver H. Gaines, David C. Peck, David M. Margulies, Vincent P.
Mihalik, and Karl-E. Arfors
For Withhold Authority Abstain
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For all nominees except as noted
2. To ratify the designation of Coopers & Lybrand LLP to audit the books and
accounts of the Company for the fiscal year ended December 31, 1998.
For Against Abstain
--- --- ---
Please sign exactly as name appears Signature: Date 1998
on this proxy. When signing as Signature: Date 1998
attorney, executor, administrator,
trustee or guardian, please give
full title. If more than one
trustee, all should sign. All joint
owners must sign.
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MARK HERE FOR CHANGE MARK HERE IF YOU
OF ADDRESS AND NOTE PLAN TO ATTEND
CHANGE ABOVE THE ANNUAL MEETING
