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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 1998
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _________ to _________
Commission File No. 0-20111
ARONEX PHARMACEUTICALS, INC.
(Exact name of Registrant as specified in its charter)
Delaware 76-0196535
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
8707 Technology Forest Drive, The Woodlands, Texas 77381-1191
(Address of principal executive offices and Zip Code)
Registrant's telephone number, including area code: (281) 367-1666
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes (X) No( )
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date.
Class Outstanding at June 30, 1998
Common Stock, $.001 par value 15,497,443 shares
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ARONEX PHARMACEUTICALS, INC.
Quarterly Period June 30, 1998
INDEX
Page
FACTORS AFFECTING FORWARD LOOKING STATEMENTS................................ 3
PART I. Financial Information
Item 1 Financial Statements............................................... 3
Balance Sheets - December 31, 1997 and June 30, 1998 (unaudited)... 4
Statements of Operations:
Six Months Ended June 30, 1997 and June 30, 1998
(unaudited) and for the Period from Inception (June 13, 1986)
through June 30, 1998 (unaudited)................................ 5
Statements of Cash Flows:
Six Months Ended June 30, 1997 and June 30, 1998
(unaudited) and for the Period from Inception (June 13, 1986)
through June 30, 1998 (unaudited)................................ 6
Notes to Financial Statements - June 30, 1998...................... 7
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations.............................. 9
PART II. Other Information
Item 4 Submission of Matters to Vote of Security Holders.................. 12
Item 6 Exhibits and Reports on Form 8-K................................... 13
SIGNATURES .......................................................... 14
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ARONEX PHARMACEUTICALS, INC.
(A development stage company)
FACTORS AFFECTING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q includes "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The
words "anticipate," "believe," "expect," "estimate," "project" and similar
expressions are intended to identify forward-looking statements. Such statements
are subject to certain risks, uncertainties and assumptions. Should one or more
of these risks or uncertainties materialize, or should underlying assumptions
prove incorrect, actual results may vary materially from those anticipated,
believed, expected, estimated or projected. For additional discussion of such
risks, uncertainties and assumptions, see "Item 1. Business -- Manufacturing,"
"-- Sales and Marketing," "-- Patents, Proprietary Rights and Licenses," "--
Government Regulation," "-- Competition" and "-- Additional Business Risks"
included in the Company's Annual Report on Form 10-K for the year ended December
31, 1997, and "Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "-- Liquidity and Capital Resources"
included elsewhere in this report.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
The following unaudited financial statements have been prepared pursuant to
the rules and regulations of the Securities and Exchange Commission. Certain
information and note disclosures normally included in annual financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to those rules and regulations, although
the Company believes that the disclosures made herein are adequate to make the
information presented not misleading. These financial statements should be read
in conjunction with the financial statements for the year ended December 31,
1997 included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1997, filed pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
The information presented in the accompanying financial statements is
unaudited, but in the opinion of management, reflects all adjustments (which
include only normal recurring adjustments) necessary to present fairly such
information.
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ARONEX PHARMACEUTICALS, INC.
(A development stage company)
BALANCE SHEETS
(All amounts in thousands, except share data)
ASSETS
June 30,
December 31, 1998
1997 (Unaudited)
Current Assets:
Cash and cash equivalents............................................. $ 2,029 $ 6,265
Short-term investments................................................ 17,783 13,457
Accounts receivable................................................... 100 --
Prepaid expenses and other assets..................................... 474 774
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Total current assets............................................. 20,386 20,496
Long-term investments.................................................... 10,142 1,509
Furniture, equipment and leasehold improvements, net 1,107 2,161
Deposits................................................................. 490 --
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Total assets..................................................... $ 32,125 $ 24,166
=============== =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses................................. $ 1,977 $ 2,786
Accrued payroll....................................................... 554 822
Advance from Genzyme.................................................. 2,000 2,000
Current portion of notes payable...................................... 191 218
Current portion of obligations under capital leases................... 18 16
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Total current liabilities........................................ 4,740 5,842
Long-term obligations:
Notes payable, net of current portion................................. -- 1,097
Obligations under capital leases, net of current portion.............. 6 --
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Total long-term obligations...................................... 6 1,097
Commitments and contingencies
Stockholders' equity:
Preferred stock $.001 par value, 5,000,000 shares authorized,
none issued and outstanding...................................... -- --
Common stock $.001 par value, 30,000,000 shares authorized,
14,597,247 and 15,497,443 shares issued and outstanding,
respectively..................................................... 15 15
Additional paid-in capital............................................ 96,606 97,635
Common stock warrants................................................. 967 50
Treasury stock........................................................ (11) (11)
Deferred compensation................................................. (907) (684)
Unrealized loss on investments....................................... (87) (87)
Deficit accumulated during development stage.......................... (69,204) (79,691)
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Total stockholders' equity...................................... 27,379 17,227
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Total liabilities and stockholders' equity........................... $ 32,125 $ 24,166
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The accompanying notes are an integral part of these
financial statements.
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ARONEX PHARMACEUTICALS, INC.
(A development stage company)
STATEMENTS OF OPERATIONS
(All amounts in thousands, except loss per share data)
(Unaudited)
Period
from
Inception
(June 13,
Six Months Ended Three Months Ended 1986)
June 30, June 30, through
June 30,
1997 1998 1997 1998 1998
--------- ---------- --------- --------- ----------
Revenues:
Interest income.................... $ 1,123 $ 748 $ 531 $ 331 $ 6,329
Research and development
grants and contracts........... 316 193 30 90 5,243
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Total revenues............ 1,439 941 561 421 11,572
Expenses:
Research and development........... 6,652 9,867 3,167 5,345 63,002
Purchase of in-process
research and development....... -- -- -- -- 11,625
General and administrative......... 931 1,547 475 643 15,351
Interest expense and other......... 150 14 120 9 1,285
--------- ---------- --------- --------- ----------
Total expenses............ 7,733 11,428 3,762 5,997 91,263
--------- ---------- --------- --------- ----------
Net loss................................ $ (6,294) $ (10,487) $ (3,201) $ (5,576) $ (79,691)
--------- ========== --------- ========= ==========
Basic and diluted loss per share........ $ (0.43) $ (0.68) $ (0.22) $ (0.36)
===== ===== ===== =====
Weighted average shares used in
computing basic and diluted loss
per share.......................... 14,646 15,464 14,671 15,468
The accompanying notes are an integral part of these
financial statements.
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ARONEX PHARMACEUTICALS, INC.
(A development stage company)
STATEMENTS OF CASH FLOWS
(All amounts in thousands)
(Unaudited)
Period from
Inception
(June 13, 1986)
Six Months Ended through
June 30, June 30,
1997 1998 1998
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Cash flows from operating activities:
Net loss. . . . . . ................................................ $ (6,294) $ (10,487) $ (79,691)
Adjustments to reconcile net loss to net cash provided by
(used in) operating activities--
Depreciation and amortization.................................. 475 360 4,386
Loss (gain) on disposal of assets.............................. 107 (2) 198
Compensation expense related to stock and stock options........ 315 268 3,504
Charge for purchase of in-process research and development..... -- -- 11,547
Unrealized loss on investment ................................. (31) -- (87)
Acquisition costs, net of cash received........................ -- -- (270)
Loss in affiliate.............................................. -- -- 500
Changes in assets and liabilities:
Increase in prepaid expenses and other assets............... (178) (300) (589)
Decrease in accounts receivable............................. 78 100 --
Increase (decrease) in accounts payable and accrued
expenses............................................ (63) 1,077 3,535
Increase in deferred revenue................................ -- -- (353)
Accrued interest payable converted to stock.................... -- -- 97
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Net cash used in operating activities................ (5,591) (8,984) (57,223)
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Cash flows from investing activities:
Net sales (purchases) of investments................................ 7,976 12,959 (9,231)
Purchase of furniture, equipment and leasehold improvements......... (206) (1,421) (5,542)
Proceeds from sale of assets........................................ 34 9 63
Decrease (increase) in deposits..................................... (147) 490 --
Investment in affiliate............................................. -- -- (500)
Net cash provided by (used in) investing activities.. 7,657 12,037 (15,210)
Cash flows from financing activities:
Proceeds from notes payable and capital leases...................... -- 1,369 6,041
Repayment of notes payable and principal payments under capital
lease obligations................................................. (155) (254) (2,712)
Purchase of treasury stock.......................................... -- -- (11)
Proceeds from issuance of stock..................................... 143 68 75,380
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Net cash provided by (used in) financing activities .. (12) 1,183 78,698
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Net increase in cash and cash equivalents.............................. 2,054 4,236 6,265
Cash and cash equivalents at beginning of period....................... 4,179 2,029 --
---------- --------- -----------
Cash and cash equivalents at end of period............................. $ 6,233 $ 6,265 $ 6,265
========== ========= ===========
Supplemental disclosures of cash flow information:
Cash paid during the period for interest............................ $ 43 $ 14 $ 799
Supplemental schedule of noncash financing activities:
Conversion of notes payable and accrued interest to common stock $ -- $ -- $ 3,043
The accompanying notes are an integral part of these
financial statements.
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ARONEX PHARMACEUTICALS, INC.
(A development stage company)
NOTES TO FINANCIAL STATEMENTS
June 30, 1998
(Unaudited)
1. Organization and Basis of Presentation
Aronex Pharmaceuticals, Inc. ("Aronex Pharmaceuticals" or the "Company")
was incorporated in Delaware on June 13, 1986 and merged with Triplex
Pharmaceutical Corporation ("Triplex") and Oncologix, Inc. ("Oncologix")
effective September 11, 1995 ("Merger"). Aronex Pharmaceuticals is a development
stage company which has devoted substantially all of its efforts to research and
product development and has not yet generated any significant revenues, nor is
there any assurance of significant future revenues. In addition, the Company
expects to continue to incur losses for the foreseeable future and there can be
no assurance that the Company will complete the transition from a development
stage company to successful operations. The research and development activities
engaged in by the Company involve a high degree of risk and uncertainty. The
ability of the Company to successfully develop, manufacture and market its
proprietary products is dependent upon many factors. These factors include, but
are not limited to, the need for additional financing, attracting and retaining
key personnel and consultants, and successfully developing manufacturing, sales
and marketing operations. The Company's ability to develop these operations may
be impacted by uncertainties related to patents and proprietary technologies,
technological change and obsolescence, product development, competition,
government regulations and approvals, health care reform, third party
reimbursement and product liability exposure. Additionally, the Company is
reliant upon collaborative arrangements for research, contractual agreements
with corporate partners, and its exclusive license agreements with M.D. Anderson
Cancer Center ("MD Anderson"). Further, during the period required to develop
its products, the Company will require additional funds which may not be
available to it. The Company expects that its existing cash resources will be
sufficient to fund its cash requirements through mid-1999. Accordingly, there
can be no assurance of the Company's future success.
The balance sheet at June 30, 1998 and the related statements of operations
and cash flows for the six month periods ending June 30, 1998 and 1997 and the
period from inception (June 13, 1986) through June 30, 1998 are unaudited. These
interim financial statements should be read in conjunction with the December 31,
1997 financial statements and related notes. The unaudited interim financial
statements reflect all adjustments which are, in the opinion of management,
necessary for a fair statement of results for the interim periods presented and
all such adjustments are of a normal recurring nature. Interim results are not
necessarily indicative of results for a full year.
2. Accounting Policies
The Company has adopted Statement of Financial Accounting Standards No. 130
("SFAS 130"), Reporting Comprehensive Income. SFAS 130 requires the reporting of
comprehensive income in addition to net income from operations. Comprehensive
income is a more inclusive financial reporting methodology that includes
disclosure of certain financial information that historically has not been
recognized in the calculation of net income. Comprehensive income (loss) was
$(6,325,000) and $(10,487,000) for the six months ended June 30, 1997 and 1998,
respectively.
3. Cash, Cash Equivalents and Investments
Cash and cash equivalents include money market accounts and investments
with an original maturity of less than three months. At June 30, 1998, all
short-term investments are held to maturity securities consisting of high-grade
commercial paper and United States Government backed securities with a carrying
value of $13,457,000, which approximates fair market value and cost. Long-term
investments at June 30, 1998 are available for sale securities which are United
States mortgage backed securities with various maturity dates over the next
several years that have an amortized cost of $1,596,000, a fair market value of
$1,509,000 and a gross unrealized loss of $87,000 at June 30, 1998. The Company
currently has no trading securities.
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ARONEX PHARMACEUTICALS, INC.
(A development stage company)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. Federal Income Taxes
At December 31, 1997, the Company had net operating loss ("NOL")
carryforwards for federal income tax purposes of approximately $79.0 million.
The Tax Reform Act of 1986 provided a limitation on the use of NOL and tax
credit carryforwards following certain ownership changes that could limit the
Company's ability to utilize these NOLs and tax credits. Accordingly, the
Company's ability to utilize its NOLs and tax credit carryforwards to reduce
future taxable income and tax liabilities may be limited. As a result of the
Merger with Triplex and Oncologix, a change in control as defined by federal
income tax law occurred, causing the use of these carryforwards to be limited
and possibly eliminated. Additionally because United States tax laws limit the
time during which NOLs and the tax credit carryforwards may be applied against
future taxable income and tax liabilities, the Company may not be able to take
full advantage of its NOLs and tax credit carryforwards for federal income tax
purposes. The carryforwards will begin to expire in 2001 if not otherwise used.
Due to the possibility of not reaching a level of profitability that will allow
for the utilization of the Company's deferred tax assets, a valuation allowance
has been established to offset these tax assets. The Company has not made any
income tax payments since inception.
- 8-
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations
Overview
Since its inception in 1986, Aronex Pharmaceuticals, Inc. ("Aronex
Pharmaceuticals" or the "Company") has primarily devoted its resources to fund
research, drug discovery and development. The Company has been unprofitable to
date and expects to incur substantial operating losses for the next several
years as it expends its resources for product research and development,
preclinical and clinical testing and regulatory compliance. The Company has
sustained losses of approximately $79.7 million through June 30, 1998. The
Company has financed its research and development activities and operations
primarily through public and private offerings of securities. The Company's
operating results have fluctuated significantly during each quarter, and the
Company anticipates that such fluctuations, largely attributable to varying
commitments and expenditures for clinical trials and research and development,
will continue for the next several years.
Three and Six Month Periods Ended June 30, 1997 and 1998
Interest income was $331,000 and $531,000 for the three months ended June
30, 1998 and 1997, respectively, a decrease of $200,000. Interest income was
$748,000 and $1,123,000 for the six months ended June 30, 1998 and 1997,
respectively, a decrease of $375,000. These decreases were primarily due to a
decrease of funds available for investment.
Revenues from research and development grants and contracts were $90,000
and $30,000 for the three months ended June 30, 1998 and 1997, respectively, an
increase of $60,000. Research and development grants and contracts were $193,000
and $316,000 for the six months ended June 30, 1998 and 1997, respectively, a
decrease of $123,000. For the six months ended June 30, 1997, research and
development revenue was composed of (i) $150,000 in revenue from the initiation
of a license agreement with Boehringer Mannheim GmbH and (ii) $166,000 in
development revenue from Targeted Genetics, Incorporated ("Targeted"). The
three-year agreement with Targeted ended in the second quarter of 1997. Research
and development revenue for the six months ended June 30, 1998 represents Small
Business Innovative Grant Research ("SBIR") grant revenue relating to
ZintevirTM.
Research and development expenses were $5,345,000 and $3,167,000 for the
three months ended June 30, 1998 and 1997, respectively, an increase of
$2,178,000. Research and development expenses were $9,867,000 and $6,652,000 for
the six months ended June 30, 1998 and 1997, respectively, an increase of
$3,215,000. These increases were primarily due to increases of $1,675,000 and
$2,810,000 in clinical investigation costs for the three and six months ended
June 30, 1998, respectively. The majority of these costs relate to clinical
trials of the Company's lead products, NYOTRANTM and ATRAGEN(R). The increases
in research and development expenses also reflect increases of $456,000 and
$626,000 in medical affairs and regulatory salaries and payroll costs for the
three and six months ended June 30, 1998, respectively, as the number of
personnel in these departments increased significantly from the same periods in
1997. These increases were partially offset by decreases of $324,000 and
$648,000 in internal research expenses for the three and six months ended June
30, 1998 as a result of the elimination of the majority of the Company's
internal research efforts in the second quarter of 1997.
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General and administrative expenses were $643,000 and $475,000 for the
three months ended June 30, 1998 and 1997, respectively, an increase of
$168,000. General and administrative expenses were $1,547,000 and $931,000 for
the six months ended June 30, 1998 and 1997, respectively, an increase of
$616,000. These increases were primarily due to (i) increases of $121,000 and
$506,000 in salaries and payroll costs; (ii) increases of $29,000 and $60,000 in
business travel relating mainly to business development activities and (iii)
increases of $53,000 and $25,000 in investor and public relations expenses for
the three and six month periods ended June 30, 1998, respectively. Several new
positions have been added since the first quarter of 1997 and a Chief Executive
Officer was added in the fourth quarter of 1997. Additionally, the Company's
President, who resigned in January 1998, is entitled to certain severance
payments in accordance with a termination and severance agreement with the
Company. These severance payments, which continue through January 1999, were
recorded as compensation expense in the first quarter of 1998.
Interest expense and other was $9,000 and $120,000 for the three months
ended June 30, 1998 and 1997, respectively, a decrease of $111,000. Interest
expense and other was $14,000 and $150,000 for the six months ended June 30,
1998 and 1997, respectively, a decrease of $136,000. These decreases in interest
expense and other resulted primarily from a loss on disposal of equipment and
leasehold improvements of $107,000 in the quarter ended June 30, 1997 that were
formerly used in now-discontinued research activities. These decreases were
partially offset by a decrease in interest expense as a result of a decrease in
the average amount of outstanding debt relating to laboratory equipment obtained
through leases and loans.
Net loss was $5,576,000 and $3,201,000 for the three months ended June 30,
1998 and 1997, respectively, an increase of $2,375,000. Net loss for the six
months ended June 30, 1998 and 1997, respectively, was $10,487,000 and
$6,294,000, an increase of $4,193,000. These increases were primarily due to the
increase in research and development expenses.
Liquidity and Capital Resources
Since its inception, the Company's primary source of cash has been from
financing activities, which have consisted primarily of sales of equity
securities. The Company has raised an aggregate of approximately $75 million
from the sale of equity securities from its inception through June 30, 1998. In
July 1992, the Company raised net proceeds of approximately $10.7 million in the
initial public offering of its Common Stock. In September 1993, the Company
entered into a collaborative agreement with Genzyme Corporation ("Genzyme")
relating to the development and commercialization of ATRAGEN(R), in connection
with which the Company received net proceeds of approximately $4.5 million from
the sale of Common Stock to Genzyme. In November 1993 and May 1996, the Company
raised net proceeds of approximately $11.5 and $32.1 million, respectively, in
public offerings of Common Stock. From October 1995 through June 30, 1998, the
Company received aggregate net proceeds of approximately $6.5 million from the
exercise of certain warrants issued in its 1995 merger with Oncologix. From its
inception until June 30, 1998, the Company also received an aggregate of $4.9
million cash from collaborative arrangements and SBIR grants.
The Company's primary use of cash to date has been in operating activities
to fund research and development, including preclinical studies and clinical
trials, and general and administrative expenses. Cash of $8.9 million and $5.6
million was used in operating activities during the first six months of 1998 and
1997, respectively. The Company had cash, cash-equivalents and short-term and
long-term investments of $21.2 million as of June 30, 1998, consisting primarily
of cash and money market accounts, and United States government securities and
investment grade commercial paper.
The Company has experienced negative cash flows from operations since its
inception and has funded its activities to date primarily from equity
financings. The Company has expended, and will continue to require, substantial
funds to continue research and development, including preclinical studies and
clinical trials of its products, and to commence sales and marketing efforts if
Food and Drug Administration and other regulatory approvals are obtained. The
Company expects that its existing capital resources will be sufficient to fund
its capital requirements through mid- 1999. Thereafter, the Company will need to
raise substantial additional capital to fund its operations. The Company's
capital requirements will depend on many factors, including the problems,
delays, expenses and complications frequently encountered by development stage
companies; the progress of the Company's research, development and clinical
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trial programs; the extent and terms of any future collaborative research,
manufacturing, marketing or other funding arrangements; the costs and timing of
seeking regulatory approvals of the Company's products; the Company's ability to
obtain regulatory approvals; the success of the Company's sales and marketing
programs; costs of filing, prosecuting and defending and enforcing any patent
claims and other intellectual property rights; and changes in economic,
regulatory or competitive conditions of the Company's planned business.
Estimates about the adequacy of funding for the Company's activities are based
on certain assumptions, including the assumption that testing and regulatory
procedures relating to the Company's products can be conducted at projected
costs. There can be no assurance that changes in the Company's research and
development plans, acquisitions, or other events will not result in accelerated
or unexpected expenditures. To satisfy its capital requirements, the Company may
seek to raise additional funds in the public or private capital markets. The
Company's ability to raise additional funds in the public or private markets
will be adversely affected if the results of its current or future clinical
trials are not favorable. The Company may seek additional funding through
corporate collaborations and other financing vehicles. There can be no assurance
that any such funding will be available to the Company on favorable terms or at
all. If adequate funds are not available, the Company may be required to curtail
significantly one or more of its research or development programs, or it may be
required to obtain funds through arrangements with future collaborative partners
or others that may require the Company to relinquish rights to some or all of
its technologies or products. If the Company is successful in obtaining
additional financing, the terms of such financing may have the effect of
diluting or adversely affecting the holdings or the rights of the holders of the
Company's Common Stock.
Year 200
Year 2000 issues result from the inability of certain computer programs or
computerized equipment to accurately calculate, store or use a date subsequent
to December 31, 1999. The erroneous date can be interpreted in a number of
different ways; typically the year 2000 is represented as the year 1900. This
could result in a system failure or miscalculations causing disruptions of
operations, including, among other things, a temporary inability to process
transactions, send invoices or engage in similar normal business.
The Company is in the process of assessing all financial and operational
systems and equipment to ensure year 2000 compliance, and plans to complete the
assessment by December 31, 1998. Based on reviews to date and preliminary
information, the Company does not anticipate that it will incur any significant
costs relating to the assessment and remediation of year 2000 issues. The
Company believes that the potential impact, if any, of its systems not being
year 2000 compliant should not impact the Company's ability to continue its
research and development activities. However, there can be no assurance that the
Company, its business partners, vendors or customers will successfully be able
to identify and remedy all potential year 2000 problems or that a system failure
resulting from a failure to identify any such problems would not have a material
adverse effect on the Company.
- 11-
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of the Stockholders of Aronex Pharmaceuticals, Inc. was
held on June 11, 1998 to consider and vote upon the following proposals:
(i) Election of Class I Directors. The following individuals were nominated and
elected as Class I directors, with the following numbers of shares voted
for and against and withheld for each director:
For Withheld
Ronald J. Brenner, Ph.D. 13,615,107 168,212
Martin P. Sutter 13,744,518 38,801
For Against Abstain
(ii) Approval and adoption of 1998 Stock Option Plan 11,376,223 2,291,320 49,623
(iii) Ratification and approval of Arthur Andersen LLP
as independent public accountants 13,711,914 51,431 19,974
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Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10.1 Aronex Pharmaceuticals, Inc. 1998 Stock Option Plan.
10.2 Employment Agreement dated June 12, 1998 between the Company and
Praveen Tyle, Ph.D.
10.3 Employment Agreement dated June 12,1998 between the Company and
Paul A. Cossum, Ph.D.
10.4 Employment Agreement dated June 12, 1998 between the Company and
Terance A. Murnane.
11.1 Statement regarding computation of per share earnings.
27.1 Financial data schedule.
(b) Reports on Form 8-K
None
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ARONEX PHARMACEUTICALS, INC.
Dated: August 12, 1998 By:/S/GEOFFREY F. COX
------------------
Geoffrey F. Cox, Ph.D.
Chief Executive Officer
Dated: August 12, 1998 By:/S/TERANCE A. MURNANE
---------------------
Terance A. Murnane
Controller
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