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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:
[ ] 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 sec.240.14a-11(c) or sec.240.14a-12
IMCLONE SYSTEMS INCORPORATED
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] 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:
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(4) Date Filed:
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[IMCLONE LOGO]
IMCLONE SYSTEMS INCORPORATED
180 Varick Street
New York, NY 10014
(212) 645-1405
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
DATE: May 24, 2001
TIME: 10:00 A.M. (Local Time)
PLACE: Le Parker Meridien Hotel New York
118 West 57th Street
New York, New York 10019
ITEMS OF BUSINESS:
1. Election of ten directors.
2. Ratification of the appointment of KPMG LLP as the Company's independent
certified public accountants for the fiscal year ending December 31,
2001.
3. Any other matters properly brought before the shareholders at the
meeting.
RECORD DATE:
Only holders of the common stock of record at the close of business on
April 9, 2001 are entitled to notice of and to vote at the meeting.
ANNUAL REPORT:
Our 2000 Annual Report, which is not a part of the proxy soliciting
material, is enclosed.
PROXY VOTING:
It is important that your shares be represented and voted at the meeting.
To vote, please complete, sign and date the enclosed proxy and promptly return
it in the envelope provided. Sending in your proxy will not prevent you from
voting in person at the meeting.
By Order of the Board of Directors
/s/ John B. Landes
John B. Landes
Secretary
New York, New York
April 23, 2001
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TABLE OF CONTENTS
ABOUT THE MEETING........................................... 1
What is the purpose of the meeting?......................... 1
Who is entitled to vote?.................................... 1
Who can attend the meeting?................................. 1
What constitutes a quorum?.................................. 1
How do I vote?.............................................. 1
Can I change my vote after I return my proxy card?.......... 2
What are the Board's recommendations?....................... 2
What vote is required to approve each item?................. 2
How are votes counted?...................................... 2
Who pays for this proxy solicitation?....................... 2
STOCK OWNERSHIP............................................. 3
Who are the largest owners of the Company's stock?.......... 3
How much stock do certain beneficial owners and the
Company's directors and certain officers own?............. 3
ITEM 1 -- ELECTION OF BOARD OF DIRECTORS.................... 5
Nominees for Director....................................... 5
Business Experience of Nominees for Director................ 6
Directors' Compensation..................................... 8
Information Concerning Board and Committee Meetings......... 10
Information Concerning Officers............................. 11
Certain Transactions........................................ 13
Executive Compensation...................................... 13
Report of the Compensation Committee on Executive
Compensation.............................................. 13
Compensation Committee Interlocks and Insider
Participation............................................. 14
Summary Compensation Table.................................. 15
Option Grants in Fiscal 2000................................ 16
Option and Warrant Exercises and Values for Fiscal 2000..... 17
Common Stock Price Performance.............................. 18
Report of the Audit Committee............................... 19
ITEM 2 -- RATIFICATION OF THE APPOINTMENT OF KPMG LLP FOR
FISCAL 2001............................................... 20
Audit Fees.................................................. 20
Financial Information Systems Design and Implementation
Fees...................................................... 20
All Other Fees.............................................. 20
Stockholder Proposals for Fiscal 2001....................... 20
Appendix A -- Audit Committee Charter....................... A-1
(i)
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IMCLONE SYSTEMS INCORPORATED
180 VARICK STREET
NEW YORK, NEW YORK 10014
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation of
proxies for use at the Annual Meeting of Stockholders of ImClone Systems
Incorporated (the "Company") to be held at 10:00 a.m., local time, on Thursday,
May 24, 2001, at Le Parker Meridian Hotel, 118 West 57th Street, New York, New
York 10019, and at any adjournments thereof. The Notice of Annual Meeting, this
proxy statement and the accompanying proxy card are first being mailed to
stockholders on or about April 24, 2001.
ABOUT THE MEETING
What is the purpose of the meeting?
At the meeting, stockholders will act upon the matters outlined in the
accompanying notice of meeting, including the election of Directors and
ratification of the Company's independent auditors. In addition, the Company's
management will report on the performance of the Company during fiscal 2000 and
respond to questions from stockholders.
Who is entitled to vote?
Only stockholders of record at the close of business on the record date,
April 9, 2001, are entitled to receive notice of the meeting and to vote the
shares of common stock that they held on that date at the meeting, or any
postponement or adjournment of the meeting. Each outstanding share entitles its
holder to cast one vote on each matter to be voted upon.
Who may attend the meeting?
Although we encourage you to complete and return the proxy card to ensure
that your vote is counted, you can attend the annual meeting and vote your
shares in person. All stockholders as of the record date, or their duly
appointed proxies, may attend the meeting. To ensure the availability of
adequate space for ImClone Systems stockholders wishing to attend the meeting,
priority seating will be given to stockholders of record, stockholders who hold
their shares in "street name" (that is, through a broker or other nominee) and
invited guests of management. In addition, a stockholder may bring one guest. In
order that seating may be equitably allocated, a stockholder wishing to bring
more than one guest must write to the Corporate Secretary of the Company in
advance of the meeting and receive written concurrence.
What constitutes a quorum?
The presence at the meeting, in person or by proxy, of the holders of a
majority of the shares of common stock outstanding on the record date will
constitute a quorum, permitting the meeting to conduct its business. As of the
record date, 66,520,491 shares of common stock of the Company were outstanding.
Proxies received but marked as abstentions and broker non-votes will be included
in the calculation of the number of shares considered to be present at the
meeting.
How do I vote?
If you complete and properly sign the accompanying proxy card and return it
to the Company, it will be voted as you direct. If you are a registered
stockholder and attend the meeting, you may deliver your completed proxy card in
person. "Street name" stockholders who wish to vote at the meeting will need to
obtain a proxy form from the institution that holds their shares.
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Can I change my vote after I return my proxy card?
Yes. Even after you have submitted your proxy, you may change your vote at
any time before the proxy is exercised by filing with the Secretary of the
Company either a notice of revocation or a duly executed proxy bearing a later
date. The powers of the proxy holders will be suspended if you attend the
meeting in person and so request, although attendance at the meeting will not by
itself revoke a previously granted proxy.
What are the Board's recommendations?
The persons named as proxy holders on the proxy card will vote in
accordance with the recommendations of the Board of Directors (the "Board"). The
Board's recommendation is "for" each of the items set forth in this proxy
statement. With respect to any other matter that properly comes before the
meeting, the proxy holders will vote as recommended by the Board or, if no
recommendation is given, in their own discretion.
What vote is required to approve each item?
Election of Directors. The affirmative vote of a plurality of the votes
cast at the meeting is required for the election of directors.
Other Items. For each other item, the affirmative vote of the holders of a
majority of the shares present in person or represented by proxy and entitled to
vote on the item will be required for approval. A properly executed proxy marked
"ABSTAIN" with respect to any such item will not be voted although it will be
counted for purposes of determining the number of votes cast on the item.
Accordingly, an abstention will have the effect of a negative vote. An
abstention will, however, be counted for purposes of determining whether there
is quorum.
How are votes counted?
If you hold your shares in "street name" through a broker or other nominee,
your broker or nominee will be able to vote your shares without instruction from
you on matters that the New York Stock Exchange determines to be routine and
will not be permitted to vote your shares on matters that the New York Stock
Exchange does not determine to be routine. Thus, if you do not give your broker
or nominee specific instruction on non-routine matters, your shares may not be
voted on those matters and will not be counted in determining the number of
shares necessary for approval on those matters. Shares represented by such
"broker non-votes" will, however be counted in determining whether there is a
quorum and in determining the number of votes cast on a routine item.
Who pays for this proxy solicitation?
We do. In addition to sending you these materials, some of our employees
may contact you by telephone, by mail, or in person. None of these employees
will receive any extra compensation for doing this. In addition, we have
retained Corporate Investor Communications, Inc. to assist us in soliciting your
proxy for a fee of $5,000 plus reasonable out-of-pocket expenses.
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STOCK OWNERSHIP
Who are the Largest Owners of the Company's Stock?
Except as set forth in the table below, the Company knows of no single
person or group of related persons that is the beneficial owner of more than 5%
of the Company's common stock. This is based solely on Schedule 13G and Schedule
13D reports filed with the Securities and Exchange Commission ("SEC") as of
March 28, 2001.
How Much Stock Do Certain Beneficial Owners, the Company's Directors and Certain
Officers Own?
The following table shows the amount of common stock of the Company
beneficially owned (unless otherwise indicated) by persons or groups of related
persons that beneficially own greater than 5% of the Company's common stock, the
Company's directors, the Named Officers in the Summary Compensation Table below
and the directors and executive officers of the Company as a group. Except as
otherwise indicated, all information is as of March 28, 2001. "Beneficial
Ownership" is a technical term defined by the SEC to mean more than ownership in
the usual sense. For example, you "beneficially own" our common stock if you own
it directly or indirectly (e.g., through a relationship, a position as a
director or trustee or through an agreement). The table below, as well as all
other portions of this proxy statement, give effect to the Company's 2-for-1
stock split, effected in the form of a dividend, in October 2000.
BENEFICIALLY BENEFICIALLY
BENEFICIAL OWNER(1) OWNED OWNED(2)
- ------------------- ------------ ------------
FMR Group................................................... 9,820,438(3) 14.7%
82 Devonshire Street
Boston, Massachusetts 02109
Samuel D. Waksal, Ph.D. .................................... 4,506,733(4) 6.6%
Harlan W. Waksal, M.D. ..................................... 3,618,560(5) 5.3%
Robert F. Goldhammer........................................ 1,641,552(6) 2.4%
John B. Landes.............................................. 510,500(7) *
John Mendelsohn, M.D. ...................................... 452,952(8) *
David M. Kies............................................... 400,015(9) *
Vincent T. DeVita, Jr., M.D. ............................... 206,684(10) *
Paul B. Kopperl............................................. 191,420(11) *
William R. Miller........................................... 138,094(12) *
Richard Barth............................................... 135,000(13) *
Ronald A. Martell........................................... 84,640(14) *
S. Joseph Tarnowski, Ph.D. ................................. 54,648(15) *
Arnold J. Levine............................................ 49,974(16) *
All directors and executive officers as a group (10
persons)(17).............................................. 11,340,984(17) 15.7%
- ---------------
* Less than 1%.
(1) Unless otherwise noted, each person's address is in care of ImClone Systems
Incorporated, 180 Varick Street, Sixth Floor, New York, New York 10014.
(2) The percentage of voting stock owned by each stockholder is calculated by
dividing (1) the number of shares deemed to be beneficially held by such
stockholder as of March 28, 2001, as determined in accordance with Rule
13d-3 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), by (2) the sum of (A) 66,489,780, which is the number of shares of
common stock outstanding as of March 28, 2001 plus (B) the number of shares
of common stock issuable upon exercise of currently exercisable options and
warrants held by such stockholder. For purposes of this security ownership
table "currently exercisable options" and "currently exercisable warrants"
consist of options and warrants exercisable as of March 28, 2001 or within
60 days after March 28, 2001.
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(3) This information is as of December 31, 2000 and was obtained from a
Schedule 13G amendment filed with the SEC on February 14, 2001. It includes
a total of 232,345 shares of common stock issuable upon conversion of
$12,800,000 principal amount of ImClone Systems Incorporated 5 1/2%
convertible notes due 2005. FMR Group is the parent company of various
Fidelity funds and related parties.
(4) Includes 2,060,000 shares issuable upon the exercise of currently
exercisable options.
(5) Includes 2,080,000 shares issuable upon the exercise of currently
exercisable options and 5,200 shares owned by Dr. Waksal's sons.
(6) Includes 352,084 shares issuable upon the exercise of currently exercisable
options; 620,600 shares issuable upon the exercise of currently exercisable
warrants; and 15,000 shares held by Mr. Goldhammer's spouse.
(7) Includes 290,000 shares issuable upon exercise of currently exercisable
options.
(8) Consists of 452,952 shares issuable upon the exercise of currently
exercisable options.
(9) Includes 115,000 shares issuable upon the exercise of currently exercisable
options, 16,400 shares held by Mr. Kies as custodian for his minor son and
615 shares held by Mr. Kies' spouse as to which Mr. Kies disclaims
beneficial ownership.
(10) Includes 206,084 shares issuable upon the exercise of currently exercisable
options.
(11) Includes 150,000 shares issuable upon the exercise of currently exercisable
options and 500 shares held by Mr. Kopperl's spouse as to which Mr. Kopperl
disclaims beneficial ownership.
(12) Includes 42,500 shares issuable upon exercise of currently exercisable
options.
(13) Consists of 135,000 shares issuable upon exercise of currently exercisable
options.
(14) Includes 82,500 shares issuable upon exercise of currently exercisable
options.
(15) Includes 53,500 shares issuable upon exercise of currently exercisable
options.
(16) Consists of 49,974 shares issuable upon exercise of currently exercisable
options and warrants.
(17) Includes an aggregate of (1) 6,264,194 shares issuable upon the exercise of
currently exercisable options and warrants and (2) 1,115 shares as to which
beneficial ownership is disclaimed. Notwithstanding that Mr. Martell, Dr.
Tarnowski and Mr. Landes are included in the Summary Compensation Table
included in this proxy statement, shares held by Mr. Martell, Dr. Tarnowski
and Mr. Landes have not been included as they are not considered to be
executive officers of ImClone Systems.
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PROPOSAL NO. 1
ELECTION OF BOARD OF DIRECTORS
An entire Board of Directors, consisting of ten members, will be elected at
the meeting. The directors elected will hold office until their successors are
elected, which should occur at the next annual meeting.
Nominations. At the meeting, the Board of Directors will nominate the
persons named in this proxy statement as directors. Although we do not know of
any reason why any of these nominees might not be able to serve, the Board of
Directors will propose a substitute nominee if any nominee is not available for
election.
General Information About the Nominees. All of the nominees are currently
directors of the Company. Each of the nominees has agreed to be named in the
proxy statement and to serve as a director if elected.
NOMINEES FOR DIRECTOR
DIRECTOR OF
NAME CURRENT POSITION WITH COMPANY COMPANY SINCE
---- ----------------------------- -------------
Richard Barth(1)(2).................... Director 1996
Vincent T. DeVita, Jr., M.D.(5)........ Director 1992
Robert F. Goldhammer(2)(3)(4).......... Chairman of the Board 1984
David M. Kies(2)(4).................... Director 1996
Paul B. Kopperl(1)(2)(4)............... Director 1993
Arnold J. Levine, Ph.D................. Director 2000
John Mendelsohn, M.D.(4)(5)............ Director 1998
William R. Miller(1)(4)................ Director 1996
Harlan W. Waksal, M.D.(3)(4)(5)........ Executive Vice President, Chief 1984
Operating Officer and Director
Samuel D. Waksal, Ph.D.(3)(5).......... President, Chief Executive Officer and 1985
Director
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(1) Member of Audit Committee
(2) Member of Compensation and Stock Option Committee
(3) Member of Executive Committee
(4) Member of Nominating and Corporate Governance Committee
(5) Member of Research Oversight Committee
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BUSINESS EXPERIENCE OF NOMINEES FOR DIRECTOR
RICHARD BARTH, 69, has been a Director of the Company since October 1996.
Mr. Barth served as Chairman of the Board of Ciba-Geigy Corporation, United
States ("Ciba-Geigy") from 1990 until December 1996, and was President and Chief
Executive Officer of Ciba-Geigy from 1986 until April 1996. Mr. Barth is a
member of the Board of Directors of numerous organizations, including The Bank
of New York, Bowater, Inc. and New York Medical College.
VINCENT T. DEVITA, JR., M.D., 66, has been a Director of the Company since
February 1992. Since 1995, Dr. DeVita has served as Director of the Yale Cancer
Center as well as Professor of Medicine and Professor of Epidemiology and Public
Health at Yale University School of Medicine, New Haven, Connecticut. From
September 1988 through June 1995, Dr. DeVita served as Attending Physician at
Memorial Sloan Kettering Cancer Center ("Sloan Kettering"), New York, and
through June 1991 as Physician-in-Chief. From 1980 to 1988, he served under
Presidential appointment as Director of the National Cancer Institute ("NCI"),
where he had held various positions since 1966. During his years with the NCI,
Dr. DeVita was instrumental in developing the first successful combination
cancer chemotherapy program. This work ultimately led to effective regimens of
curative chemotherapy for a variety of cancers. Dr. DeVita's numerous awards
include the 1990 Armand Hammer Cancer Prize and the 1982 Albert and Mary Lasker
Medical Research Award for his contribution to the cure of Hodgkin's disease.
Dr. DeVita received his M.D. from the George Washington University School of
Medicine, Washington, D.C. in 1961.
ROBERT F. GOLDHAMMER, 70, has served as the Company's Chairman of the Board
since February 1991 and has been a Director of the Company since October 1984.
Mr. Goldhammer has been a partner of Concord International Group, L.P. since
1991. He was a partner of Rohammer Corporation, a private investment company,
from 1989 to 1991. He was a managing director of Kidder, Peabody Group Inc., an
investment banking firm, from May 1988 to January 1989. He is a director of
Esterline Technologies Corporation.
DAVID M. KIES, 57, has been a Director of the Company since June 1996. Mr.
Kies is a Partner of the New York based law firm Sullivan & Cromwell,
specializing in mergers and acquisitions, securities and general corporate
matters.
PAUL B. KOPPERL, 67, has served as a Director of the Company since December
1993. He is President of Pegasus Investments, Inc., Boston, a private investment
management firm established in 1994. He has served as President of Delano &
Kopperl, Inc., a private business strategy and venture investing firm in Boston
and its predecessor firms from 1976 to the present. From 1967 through 1975, he
was Vice President and a principal of Kidder, Peabody & Co. Incorporated, New
York an investment banking firm. From 1959 to 1967 he was an associate with
Goldman, Sachs & Co., New York. Mr. Kopperl is a Trustee and Governor of the
Dana-Farber Cancer Institute, Boston and a member of its Executive, Investment
and Trustee Science Committees. He serves as Advisor to the Dean, Harvard School
of Public Health. Over the years he has served as a trustee or director of
numerous businesses and not-for-profit educational, performing arts and social
welfare organizations.
ARNOLD J. LEVINE, PH.D., 60, has served as a member of the Board since
April 2000. Dr. Levine is a cancer biologist and is President of Rockefeller
University. Previously, Dr. Levine was the Harry C. Wiess Professor of Life
Sciences at Princeton University, where he founded Princeton's molecular biology
department during a 12-year tenure that saw the department grow to include two
research laboratories and 35 faculty members. Prior to his work at Princeton,
Dr. Levine was Chairman at SUNY Stony Brook School of Medicine. Dr. Levine is
also a Director of PE Corporation, Baxter International, Inc., Genomica Corp.
and Advanced Medicine.
JOHN MENDELSOHN, M.D., 64, has been a Director of the Company since
February 1998. He has served as the President of M.D. Anderson Cancer Center,
University of Texas, where he has also been Professor of Medicine since 1996.
From 1985 to 1996 he was Chairman of the Department of Medicine at Sloan
Kettering, New York, as well as holder of the Winthrop Rockefeller Chair in
Medical Oncology at Sloan Kettering. He was also Professor and Vice-Chairman of
Medicine at Cornell University Medical College and an attending physician at
both Memorial and New York Hospitals. Dr. Mendelsohn served on the faculty of
the University
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of California, San Diego and was instrumental in the creation of the
University's Cancer Center, where he served as Director from 1976 to 1985. Dr.
Mendelsohn's work has focused on growth factors and their role in regulating the
proliferation of cancer cells through cell surface receptors. Dr. Mendelsohn was
responsible for developing specific monoclonal antibodies that block receptors,
including epidermal growth factor receptors, which mediate growth factor
activation of cell growth and division. Dr. Mendelsohn is currently a board
member of Enron Corp., the Richard Lounsbery Foundation and the Greater Houston
Partnership, and a fellow of the New York Academy of Medicine. In 1997, Dr.
Mendelsohn was elected to the Institute of Medicine of the National Academy of
Sciences.
WILLIAM R. MILLER, 72, has been a Director of the Company since June 1996.
Mr. Miller served as Vice Chairman of the Board of Directors of the
Bristol-Myers Squibb Company from 1985 until 1991, at which time he retired. Mr.
Miller is a director of Isis Pharmaceuticals, Inc. and Transkaryotic Therapies,
Inc. He is Chairman of the Board of Vion Pharmaceuticals, Inc. He is Chairman of
the Board of Trustees of the Cold Spring Harbor Laboratory and is a past
Chairman of the Board of the Pharmaceutical Manufacturers Association. Mr.
Miller is a Trustee of the Manhattan School of Music, Metropolitan Opera
Association and Opera Orchestra of New York. He is a member of Oxford University
Chancellor's Court of Benefactors, Honorary Fellow of St. Edmund Hall and
Chairman of the English-Speaking Union of the United States.
HARLAN W. WAKSAL, M.D., 48, is a founder of the Company and has been a
Director since April 1984. He has directed the Company's research and
development since April 1985, and has served as the Company's Executive Vice
President and Chief Operating Officer since March 1987. From 1985 to March 1987,
Dr. Waksal served as the Company's President. Dr. Waksal received his training
in Internal Medicine from Tufts-New England Medical Center Hospital and in
Pathology from Kings County Hospital in Brooklyn, New York from 1982 to 1987.
From 1984 to 1985, Dr. Waksal was Chief Resident in Pathology at Kings County
Hospital. He received his Medical Degree from Tufts University School of
Medicine in 1979. He is currently Adjunct Assistant Professor in the Department
of Pathology at Downstate Medical Center, New York. Dr. Harlan Waksal and Dr.
Samuel Waksal are brothers.
SAMUEL D. WAKSAL, PH.D., 53, President and Chief Executive Officer of the
Company, is a founder of the Company and has been its Chief Executive Officer
and a Director since August 1985 and President since March 1987. From 1982 to
1985, Dr. Waksal was a member of the faculty of Mt. Sinai School of Medicine as
Associate Professor of Pathology and Director of the Division of Immunotherapy
within the Department of Pathology. He has served as visiting Investigator of
the National Cancer Institute, Immunology Branch, Research Associate of the
Department of Genetics, Stanford University Medical School, Assistant Professor
of Pathology at Tufts University School of Medicine and Senior Scientist for the
Tufts Cancer Research Center. Dr. Waksal was a scholar of the Leukemia Society
of America from 1979 to 1984. Dr. Waksal has been a visiting professor at the
Weizmann Institute in Israel and the Pasteur Institute in France. He sits on the
Board of Directors of ValiGen. Dr. Waksal currently serves on the Executive
Committee of the New York Biotechnology Association, the Board of Advisors of
Rockefeller University and is Chairman of the New York Council for the
Humanities. Dr. Samuel Waksal and Dr. Harlan Waksal are brothers.
THE BOARD RECOMMENDS A VOTE "FOR" EACH OF THE NOMINEES NAMED ABOVE
(PROPOSAL NO. 1 ON YOUR PROXY CARD).
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DIRECTORS' COMPENSATION
CASH COMPENSATION
Exclusive of the Chairman, each Director of the Company, who is not a
full-time employee of the Company or who does not otherwise provide consulting
services to the Company receives compensation of $10,000 per year, or a pro rata
portion thereof for persons not serving the full fiscal year, for such person's
services as a Director as well as reimbursement of the Director's reasonable
out-of-pocket expenses incurred in connection with his Board and Board committee
activities. The Chairman, who is not a full-time employee of the Company,
receives $150,000 per year for his services as Chairman as well as reimbursement
of his reasonable out of pocket expenses incurred in connection with his Board
and Board committee activities. In addition, subject to the first sentence of
this paragraph, the Chairman of each of the Board committee receives $5,000 per
year as compensation for the services of each as Chairman.
DIRECTORS' STOCK OPTIONS
Pursuant to the Company's 1996 Non-Qualified Stock Option Plan (the "1996
Non-Qualified Plan"), Directors who are not full-time employees of the Company
automatically receive on each February 15th an option to purchase a specified
number of shares of common stock. Individuals joining the Board during the
course of the year receive a pro rata portion thereof. This specified number was
15,000 shares for 2000; however, the amount was increased to 30,000 shares in
2001 by vote of the Board due to the 2-for-1 stock split effected by the Company
in 2000, except that for the Chairman who is not a full-time employee of the
Company for whom this number was increased from 30,000 to 60,000 shares. Such
options vest after one full year of service on the Board from the date of grant
and have an exercise price equal to the fair market value of the common stock on
the date of grant. Directors newly joining the Board who are not full-time
employees of the Company are made a one-time option grant under the 1996
Non-Qualified Plan to purchase 50,000 shares of common stock. Such options vest
as to 25% of the shares of common stock over the four-year period commencing
with the date of grant, subject to such individual's continued service on the
Board on the scheduled date of vesting, and have an exercise price equal to the
fair market value of the common stock on the date of grant. From time to time,
directors who are not full-time employees of the Company may be granted
additional options in consideration for providing services on the Board. No such
additional grants were made during 2000.
The table below sets forth option grants to Directors who are not full-time
employees of the Company during the year ended December 31, 2000 in
consideration for such Directors serving on the Board:
NUMBER OF
NAME OPTIONS
- ---- ---------
Richard Barth............................................... 30,000(1)
Vincent T. DeVita, Jr. ..................................... 30,000(1)
Robert F. Goldhammer........................................ 60,000(1)
David M. Kies............................................... 30,000(1)
Paul B. Kopperl............................................. 30,000(1)
Arnold J. Levine............................................ 21,474(2)
50,000(2)
John Mendelsohn............................................. 30,000(1)
William R. Miller........................................... 30,000(1)
- ---------------
(1) These options were granted automatically pursuant to the terms of the 1996
Non-Qualified Plan on February 15, 2000 at a per share exercise price of
$38.91 which is equal to the fair market value of the common stock on the
date of grant. They vested and became exercisable in their entirety on
February 15, 2001 and terminate February 14, 2010.
(2) Dr. Levine joined the Board on April 14, 2000. The option to purchase 21,474
shares was granted to Dr. Levine as a pro rata amount of the automatic
option grant to purchase 30,000 shares under the 1996
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Non-Qualified Plan due to the fact that he would not be serving the full
fiscal year. This option is exercisable at a per share exercise price of
$34.50 which is equal to the fair market value of the common stock on the
date of grant. It vested in its entirety on April 14, 2001 and terminates on
April 13, 2010. The option to purchase 50,000 shares was issued in
accordance with Company policy when Dr. Levine joined the Board and is
exercisable at a per share exercise price of $34.50 which is equal to the
fair market value of the common stock on the date of grant. It vests as to
25% of the shares of common stock over the four-year period commencing with
the date of grant, subject to such individual's continued service on the
Board.
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INFORMATION CONCERNING BOARD AND COMMITTEE
MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors oversees the business and affairs of the Company and
monitors the performance of management. In accordance with corporate governance
principles, the Board does not involve itself in day-to-day operations. During
the year ended December 31, 2000, there were five meetings of the Company's
Board. The Board also took certain actions by unanimous written consent. No
incumbent director attended fewer than 75% of the total number of meetings of
the Board and of the Committees of the Board on which he served, except for Dr.
DeVita who attended four of the total number of meetings of the Board and of the
Committees of the Board on which he served.
The Company has an Executive Committee of the Board composed of Samuel D.
Waksal (Chairman), Robert F. Goldhammer and Harlan W. Waksal. The Executive
Committee acts for the Board when formal Board action is required between Board
meetings. The Executive Committee has all the power of the full Board in the
management of the business and affairs of the Company, except those powers that
by law cannot be delegated by the Board. The Executive Committee did not meet
formally during the year ended December 31, 2000.
The Company has an Audit Committee of the Board composed of Paul B. Kopperl
(Chairman), Richard Barth and William R. Miller. The primary functions of the
Audit Committee are to monitor the integrity of the Company's financial
reporting process and systems of internal controls regarding finance, accounting
and legal compliance. The Audit Committee provides an avenue of communication
among the independent auditors, management and the Board of Directors. The Audit
Committee met three times during the year ended December 31, 2000.
The Company has a Compensation and Stock Option Committee (the
"Compensation Committee") of the Board composed of Robert F. Goldhammer
(Chairman), Paul B. Kopperl, David M. Kies and Richard Barth. The Compensation
Committee is responsible for developing executive compensation policies. The
Compensation Committee also (i) determines annually the base salary to be paid
to the Chief Executive Officer and determines bonuses and incentive awards to be
paid from time to time to the Chief Executive Officer; and (ii) approves
annually a salary plan for other senior officers (on the recommendation of the
Chief Executive Officer in conjunction with other senior personnel) and approves
bonuses and incentive awards to be paid from time to time to such senior
officers. The Compensation Committee also administers the Company's various
stock option and purchase plans, including the granting of options under the
option plans. The Compensation Committee met one time during the year ended
December 31, 2000 and also took certain actions by unanimous written consent.
The Company has a Nominating and Corporate Governance Committee composed of
David M. Kies (Chairman), Paul B. Kopperl, John Mendelsohn, William R. Miller,
Robert F. Goldhammer and Harlan W. Waksal. The Nominating and Corporate
Governance Committee considers and makes recommendations to the Board regarding
Board and committee nominees and membership, director performance and officer
candidates. The Nominating and Corporate Governance Committee also considers and
makes recommendations to the Board with respect to corporate organizational and
governance matters. The Nominating and Corporate Governance Committee met one
time during the year ended December 31, 2000. The Nominating and Corporate
Governance Committee considers nominations for director made by stockholders of
the Company in accordance with the procedures for submission of proposals at
annual or special meetings of stockholders set forth in the Company's Amended
and Restated By-laws.
The Company has a Research Oversight Committee composed of Samuel D. Waksal
(Chairman), Vincent T. DeVita, Jr., John Mendelsohn and Harlan W. Waksal. The
Research Oversight Committee participates on behalf of the Board in monitoring
the research focus of the Company. The Research Oversight Committee did not meet
formally during the year ended December 31, 2000.
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INFORMATION CONCERNING OFFICERS
Certain information concerning officers of the Company is provided below.
SAMUEL D. WAKSAL, PH.D., is the President and Chief Executive Officer of
the Company. Certain information concerning Dr. Waksal appears on page 7.
HARLAN W. WAKSAL, M.D., is the Executive Vice President and Chief Operating
Officer of the Company. Certain information concerning Dr. Waksal appears on
page 7.
PETER BOHLEN, PH.D., 58, has been Senior Vice President, Research of the
Company since January 2001. He joined the Company in September 1996 as Vice
President, Research. From November 1995 to July 1996 he was Senior Director of
Ixsys, a privately-held biotechnology company. From October 1987 to June 1996 he
was department head of the Molecular Biology Section of American Cyanamid's
Medical Research Division and director of the company's angiogenesis program. He
also has held academic positions at the Salk Institute, San Diego and the
University of Zurich, Switzerland. Dr. Bohlen received his Ph.D. in chemistry
from the University of Berne in Switzerland. In 1983, he received the Cloetta
Award in Switzerland for his contributions in the field of protein analysis. He
has authored or co-authored over 200 publications and is a named inventor on 26
patents.
CHARLES DUNNE, 36, has been Vice President, Management Information Systems
and Facilities since January 2001. Mr. Dunne, one of the Company's first
employees, joined the Company in 1984 and has served it in a number of
capacities, including Assistant Vice President, Management Information Systems
and Facilities during 2000, Senior Director, Management Information Systems
during 1999 and Director, Management Information Systems during 1998. Mr. Dunne
supervised the construction of the Company's corporate headquarters and research
laboratories and has implemented all systems at the Company since 1984.
PAUL A. GOLDSTEIN, 36, has been Vice President, Financial Operations since
January 2001. He joined the Company in January 1992 and has served in various
capacities since that date, including Assistant Vice President, Finance during
2000, Senior Director, Finance and Controller from January 1998 through December
1999 and Controller from January 1995 through December 1997. Prior to joining
the Company he was employed by Laventhol & Horwath, a certified public
accounting firm in New York City. Mr. Goldstein is a certified public
accountant.
JOHN B. LANDES, 53, has served as Senior Vice President, Legal since
January 2001 and General Counsel since 1992. He was Vice President, Legal from
1992 to 2000 and also Vice President, Business Development from 1992 through
1999. Prior thereto, he was Vice President, Administration and Legal since
December 1984. He also has been Secretary of the Company since April 1985 and
served as its Treasurer from April 1984 through September 1991, except for an
interim period from December 1988 to February 1991. From 1978 to 1984, Mr.
Landes was an associate attorney with the Boston law firm of Mahoney, Hawkes and
Goldings.
LILY WAIYEE LEE, PH.D., 45, joined the Company in April 2001 as its Vice
President, Regulatory. Dr. Lee was employed at The Lipsome Company, Division of
Elan Corporation, as its Vice President, Clinical & Regulatory Operations and
Biostatistics from 1995 to April 2001 and as its Executive Director,
Biostatistics and Data Management from 1993 through 1994. Prior to that time she
was employed for over five years in various statistical positions at Ciba
Consumer Pharmaceuticals, Division of Ciba Geigy. Dr. Lee earned a bachelor
degree in statistics from the University of Minnesota and both a masters degree
in Biostatistics and Ph.D. in Demography from the University of California,
Berkeley.
DANIEL S. LYNCH, 43, joined the Company in April 2001 as its Vice
President, Finance and Chief Financial Officer. From May 1999 through March
2001, he served as Chief Financial Officer of Derby Cycle Corporation. Prior to
this, Mr. Lynch served for 15 years in various capacities at Bristol-Myers
Squibb Company, including from December 1998 through May 1999, as its Vice
President, Finance, U.S. Pharmaceutical, Worldwide Medicines Group; from April
1998 through November 1998 as its Vice President, Finance, Technical Operations,
Worldwide Medicines Group; from July 1997 through March 1998 as its Vice
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President, Finance, Intercontinental, Worldwide Medicines Group; and from
February 1995 through June 1997 as its Vice President, Finance, Worldwide
Consumer Medicines Group.
RONALD A. MARTELL, 39, has served as the Company's Vice President,
Marketing and Sales since November 1998. Prior to joining the Company he worked
at Genentech, Inc. for ten years where he held various positions. Most recently,
from 1996 until joining the Company, he served as Genentech's Group Manager of
Oncology Products where he directed the launch of Herceptin, Genentech's
monoclonal antibody product approved to treat breast cancer. From 1995 to 1996
he served as Senior Product Manager where he launched Pulmozyme for cystic
fibrosis in Europe. From 1994 through 1995 he served as Manger of Genentech's
Piedmont Sales Division. Prior to that, he served from 1993 as Associate Product
Manager for Genentech's Pulmozyme.
MICHAEL NEEDLE, M.D., 41, has served as the Company's Vice President,
Clinical Affairs since January 2001. He joined the Company in April 2000 as its
Assistant Vice President, Clinical Affairs. Prior to joining the Company, Dr.
Needle served as Director, Oncology Clinical Research of G.D. Searle, a Monsanto
Company. From July 1993 through November 1997 Dr. Needle served as Assistant
Professor of Pediatrics and Neurology, Children's Hospital of Philadelphia,
University of Pennsylvania School of Medicine. Dr. Needle received a Bachelor of
Arts degree in Physics from Binghamton University and a Doctor of Medicine
degree from the State University of New York, Health Science Center at Brooklyn.
Dr. Needle performed his residency in Pediatrics at Kings County Hospital in
Brooklyn and his Pediatric Hematology/Oncology fellowship at the Fred Hutchinson
Cancer Research Center in Seattle and the University of Texas, MD Anderson
Cancer Center in Houston.
GARY PAULTER, 38, has served as the Company's Vice President, Engineering
and Facilities at its New Jersey location since January 2001. Mr. Paulter joined
the Company in 1993 as Facilities Engineer and has served in various capacities
since that date, including, Facility Manager from 1995 through 1996, Manager,
Engineering & Facilities from 1997 through 1999 and Director, Engineering and
Facilities from 1999 through 2000.
ANDREA F. RABNEY, 34, has served as the Company's Vice President, Corporate
Communications since January 2001. She joined the Company in 1993 as its
Director, Corporate Development and Investor Relations and has served in several
other managerial positions since that time, including Senior Director, Corporate
Development & Investor Relations from 1998 to 1999 and Assistant Vice President,
Corporate Communications during 2000. Prior to joining ImClone Systems, Ms.
Rabney served as a compliance analyst at Smith Barney Shearson Inc. (now Salomon
Smith Barney) where she was responsible for defining capital markets guidelines
and procedures for foreign and institutional accounts and trading desks. Ms.
Rabney holds a law degree from the Jacob D. Fuchsberg Law Center of Touro
College.
S. JOSEPH TARNOWSKI, PH.D., 47, has served as the Company's Vice President,
Product and Process Development since January 1999. Prior to joining the
Company, he held various positions with CellPro, Inc., the principal business of
which was the development, manufacture and marketing of automated systems that
utilize monoclonal antibodies to purify large quantities of specific cells for
therapeutic and diagnostic applications. He joined CellPro in June 1992 as Vice
President of Operations, was appointed to 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 through 1981.
CATHERINE M. VACZY, 39, has served as the Company's Associate General
Counsel since February 1997 and Vice President, Legal since January 2001. She
served as its Assistant Vice President, Legal during 2000 and as its Senior
Director, Legal, from 1997 through 1999. Prior to joining the Company, Ms. Vaczy
served as a senior associate specializing in corporate and securities matters in
the New York City office of Ross & Hardies, a Chicago-based law firm.
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LARRY WITTE, 56, has served as the Company's Vice President, Research since
January 2001. He joined the Company in 1990 and has served in various capacities
since that date, including Assistant Vice President, Research during 2000,
Senior Director, Research during 1999 and Director, Research from 1994 to 1999.
Since 1990, Dr. Witte has served as an Adjunct Professor of Anatomy and Cell
Biology at Columbia University's College of Physicians and Surgeons. Dr. Witte
oversees the Company's research activities relating to its Molecular and Cell
Biology Laboratory. Dr. Witte is an authority in the areas of molecular and cell
biology and cancer research and has authored or co-authored over 45
publications. Dr. Witte earned his Bachelor of Science degree in zoology and his
Ph.D. in Physiology from Iowa State University; he did his postdoctoral in cell
biology at Columbia's College of Physicians and Surgeons and completed a
research fellowship in cell biology at the Mayo Clinic.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Ownership of and transactions in the Company's securities by executive
officers and directors of the Company and owners of 10% or more of the Company's
outstanding common stock are required to be reported to the SEC pursuant to
Section 16(a) of the Exchange Act. During the year ended December 31, 2000,
based on information received by the Company, one form was untimely filed for
each of Dr. Harlan Waksal, Mr. Robert F. Goldhammer, Mr. William Miller, Dr.
Arnold J. Levine and two forms were untimely filed for Dr. Samuel Waksal.
CERTAIN TRANSACTIONS
During the year ended December 31, 2000, the Company paid Dr. Vincent T.
DeVita, Jr., a Director of the Company, a total of $100,000 for scientific
consulting services provided to the Company by Dr. DeVita.
The Company has accepted from its President and Chief Executive Officer, a
full recourse, unsecured promissory note dated as of December 21, 2000 in the
principal amount of $282,200. The note is payable upon the earlier of June 21,
2001 or demand by the Company and bears interest at an annual rate of 10 1/2%
for the period that the loan is outstanding.
In January 1998, the Company accepted a full recourse, unsecured promissory
note totaling approximately $131,000 from its President and Chief Executive
Officer in connection with the exercise of a warrant to purchase 174,610 shares
of the Company's common stock. The note was due no later than two years from
issuance. Interest was payable on the first anniversary date of the promissory
note and on the stated maturity or any accelerated maturity at the annual rate
of 8 1/2%. The note, including all interest, has been paid in full.
The Company uses Concord Investment Management, a New York-based money
management firm, to manage a substantial portion of the Company's debt security
portfolio. The Company's Chairman of the Board is a limited partner of Concord
Investment Management. The Company paid investment management fees to Concord
Investment Management of approximately $412,000 in the year ended December 31,
2000.
EXECUTIVE COMPENSATION
REPORT OF COMPENSATION COMMITTEE
Overall Philosophy
The Company's executive compensation philosophy is based on the premise
that compensation should be set at levels that support the Company's business
strategies and long-term objectives and relate to an individual's performance.
The elements of the executive compensation package are base salary and
participation in annual incentives, including stock options.
In establishing base salaries, annual incentive awards and awards of stock
options, the Compensation Committee considers the executive's annual review and
periodic compensation surveys, including those provided by third parties
covering the biopharmaceutical industry.
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The Compensation Committee uses no set formulas and may accord different
weight to different factors for each executive. The Committee looks toward the
progress of the Company's research and development programs, its ability to gain
support for such programs, either internally or externally, its ability to
attract, motivate and retain talented employees and its ability to secure
capital sufficient for its product development to achieve rapid and effective
commercialization as may be practicable.
Deductibility of Compensation
The Compensation Committee has reviewed the impact of Section 162(m) of the
Internal Revenue Code of 1986, as amended (the "Code"), which, beginning in
1994, limits the deductibility of certain otherwise deductible compensation in
excess of $1 million paid to the Chief Executive Officer and the other Named
Officers (as hereinafter defined). It is the policy of the Company to attempt to
have its executive compensation plans treated as tax deductible compensation
whenever, in the judgment of the Compensation Committee, to do so would be
consistent with the objectives of that compensation plan.
Chief Executive Officer Compensation
In evaluating Dr. Samuel D. Waksal's 2000 performance, the following
Company achievements were noted:
- In November 2000, the Company announced favorable preliminary results
from its Phase II study of IMC-C225 in combination with irinotecan in
refractory colorectal carcinoma and that it had met its primary endpoint
of patient response
- At the May 2000 meeting of the American Society of Clinical Oncologists
("ASCO"), the Company gave presentations of data on the use of IMC-C225
and chemotherapy in the treatment of colorectal and head and neck
refractory cancers
- During 2000, the Company continued to move toward the filing of a
Biologics License Application ("BLA") with the Food and Drug
Administration for its Phase II study of IMC-C225 in combination with
irinotecan in refractory colorectal carcinoma
- In 2000, the Company commenced patient treatment in a Phase I clinical
study of its lead clinical candidate for angiogenesis inhibition,
IMC-ICII in patients with metastatic colorectal carcinoma
- At the end of 2000, the Company had financial assets of approximately
$370,000,000, of which $240,000,000 resulted from the February 2000
private placement of the Company's 5 1/2% convertible notes due 2005.
These resources enable the Company to pursue its established strategic
goals
The Company's leadership under both Dr. Samuel D. Waksal and Dr. Harlan W.
Waksal has resulted in the Company continuing to progress toward becoming a
commercial stage, fully integrated biopharmaceutical company.
Compensation and Stock Option
Committee
Robert F. Goldhammer, Chairman
Richard Barth
David M. Kies
Paul B. Kopperl
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
As of December 31, 2000, the members of the Compensation Committee were
Richard Barth, Robert F. Goldhammer (Chairman), David M. Kies and Paul B.
Kopperl, none of whom is a full-time employee of the Company or any of its
subsidiaries or has ever been an officer of the Company or any subsidiaries.
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SUMMARY COMPENSATION TABLE
The Summary Compensation Table sets forth the cash and non-cash
compensation awarded to, earned by, or paid to the Company's Chief Executive
Officer and the four most highly compensated officers (other than the Chief
Executive Officer) for the years ended December 31, 2000, 1999 and 1998 who were
serving as officers at December 31, 2000 and whose total salary and bonus
exceeded $100,000 for the year ended December 31, 2000 (the "Named Officers").
LONG TERM
COMPENSATION AWARDS
ANNUAL COMPENSATION ---------------------
------------------------- OTHER ANNUAL SECURITIES UNDERLYING ALL OTHER
SALARY BONUS COMPENSATION OPTIONS AND WARRANTS COMPENSATION
YEAR ($)(1) ($)(2) ($)(3) (#)(4) ($)
---- -------- ---------- ------------ --------------------- ------------
Samuel D. Waksal............ 2000 $500,000 $1,000,000 $ -- -- $10,435(5)
President and Chief 1999 300,000 600,000 -- 2,000,000 10,435(5)
Executive Officer 1998 300,000 400,000 -- 600,000 10,435(5)
Harlan W. Waksal............ 2000 400,000 800,000 -- -- --
Executive Vice President 1999 250,000 500,000 -- 1,300,000 --
and Chief Operating
Officer 1998 250,000 300,000 -- 500,000 --
S. Joseph Tarnowski(6)...... 2000 204,750 100,000 36,083(9) 24,000 --
Vice President, Product 1999 195,000 60,000 -- 150,000 --
and Process Development 1998 -- -- -- -- --
John B. Landes.............. 2000 200,000 100,000 -- 34,000 --
Senior Vice President, 1999 175,000 25,000 -- -- --
Legal and General Counsel 1998 165,000 120,000 -- 270,000 --
Ronald A. Martell(7)........ 2000 183,750 100,000 -- 24,000 --
Vice President, 1999 175,000 100,000 -- 150,000 --
Marketing and Sales 1998 15,417(7) 25,000(8) 161,216(9) 120,000 --
- ---------------
(1) Amounts shown include compensation deferred pursuant to Section 401(k) of
the Code.
(2) Although the Company has no formal bonus plan, the Compensation Committee,
in its discretion, may award bonuses to officers of the Company. The Company
has paid bonuses based on individual and Company performance. Amounts shown
include awards paid relative to services rendered in each of the last three
fiscal years. All bonus awards for each of the last three fiscal years were
paid in cash. Bonuses are recorded for the period in which they were earned.
(3) Excludes perquisites and other personal benefits for each Named Officer
which did not equal or exceed the lesser of $50,000 or 10% of such
individual's base salary and bonus for the years ended December 31, 2000,
1999 and 1998, respectively.
(4) Options to purchase the number of shares of common stock shown are recorded
for the period in which they were granted.
(5) Consists of premium payments on a term life insurance policy for Dr. Samuel
D. Waksal under which his daughters are the beneficiaries.
(6) Dr. Tarnowski commenced employment with the Company in January 1999.
(7) Mr. Martell commenced employment with the Company in November 1998.
(8) This was a sign-on bonus paid to Mr. Martell upon his joining the Company.
(9) Consists of relocation expenses associated with the individual's joining the
Company.
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OPTION GRANTS IN FISCAL 2000
The following table sets forth certain information relating to stock option
grants to the Named Officers during the year ended December 31, 2000.
% OF TOTAL POTENTIAL REALIZABLE VALUE AT
NUMBER OF OPTIONS ASSUMED ANNUAL RATES OF
SECURITIES GRANTED TO STOCK PRICE APPRECIATION FOR
UNDERLYING EMPLOYEES EXERCISE OPTION TERM(3)
OPTIONS IN FISCAL PRICE EXPIRATION -----------------------------
NAME GRANTED# YEAR(1) ($/SHARE)(2) DATE 0%($) 5%($) 10%($)
---- ---------- ---------- ------------ ---------- ----- -------- ----------
Samuel D. Waksal....... -- -- -- -- -- $ -- $ --
Harlan W. Waksal....... -- -- -- -- -- -- --
John B. Landes......... 34,000(4) 1% $31.8125 12/20/10 -- 679,993 1,723,099
S. Joseph Tarnowski.... 24,000(4) 1% $31.8125 12/20/10 -- 479,995 1,216,305
Ronald A. Martell...... 24,000(4) 1% $31.8125 12/20/10 -- 479,995 1,216,305
- ---------------
(1) The Company granted options to purchase a total of 2,585,220 shares of
common stock to employees during 2000.
(2) Options were granted to purchase common stock at an exercise price that
equaled the fair market value of the common stock on the date of grant.
(3) The amounts set forth in the three columns represent hypothetical gains that
might be achieved by the holders if the respective options are exercised at
the end of their terms. These gains are based on assumed rates of stock
price appreciation of 0%, 5% and 10% compounded annually from the dates the
respective options were granted.
(4) These options are exercisable as to 50% of the shares on each of the first
and second anniversaries of the date of grant, except that 10,000 of the
options held by Mr. Landes are exercisable as to 25% of the shares on each
of the first, second, third and fourth anniversaries of the date of grant.
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OPTION AND WARRANT EXERCISES AND VALUES FOR FISCAL 2000
The following table sets forth option and warrant exercises during the year
ended December 31, 2000 by the Named Officers and the value of the options and
warrants held by such person on December 31, 2000, whether or not exercisable on
such date.
NUMBER OF SHARES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS/ WARRANTS AT OPTIONS WARRANTS AT
SHARES DECEMBER 31, 2000(#) DECEMBER 31, 2000($)(2)
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME EXERCISE(#) REALIZED($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- -------------- ----------- ------------- ----------- -------------
Samuel D. Waksal........ 1,450,000 $54,541,150 2,120,000 180,000 $74,347,500 $6,896,250
Harlan W. Waksal........ 6,360 306,120 2,430,000 150,000 91,650,575 5,746,875
John B. Landes.......... 298,000 12,019,938 209,000 115,000 8,061,063 3,517,687
S. Joseph Tarnowski..... 14,000 560,170 23,500 136,500 831,011 4,456,294
Ronald A, Martell....... 15,000 859,375 82,500 196,500 2,877,188 6,003,750
- ---------------
(1) The values realized were calculated by multiplying the closing market price
of the common stock on the date of exercise by the respective number of
shares exercised and subtracting the aggregate exercise price. Accordingly,
such values realized assume a sale of such common stock on the date of
exercise, however, only 9% of these shares were sold as of April 23, 2001.
(2) The values were calculated by multiplying the closing market price of the
common stock on December 31, 2000 ($44.00 per share as reported by the
Nasdaq National Market on that date) by the respective number of shares and
subtracting the aggregate exercise price, without making any adjustments for
vesting, termination contingencies or other variables. If the exercise price
of an option or warrant is equal to or greater than $44.00 the option or
warrant is deemed to have no value.
OTHER BENEFIT PLANS
The Company has no defined benefit or defined contribution retirement plans
other than the ImClone Systems Incorporated 401(k) Employee Savings Plan (the
"Plan") established under Section 401(k) of the Code. Contributions to the Plan
are voluntary, and substantially all full-time employees are eligible to
participate. For 2000, the Company elected to make voluntary matching
contributions equal to 25% of the first 4% of an employee's eligible
compensation contributed by the employee, limited to $2,500 per employee. The
Company made such a matching contribution for 2000 which totaled $108,000. The
Company anticipates evaluating the level of its matching contribution, if any,
on an annual basis. For 2001, the Company increased the voluntary matching
contribution to 25% of the first 6% of an employee's eligible compensation
contributed by the employee, limited to $2,500 per employee.
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COMMON STOCK PRICE PERFORMANCE
The graph below provides a comparison of the cumulative total return
(assuming reinvestment of dividends) for the Company (which paid no dividends)
with The Nasdaq Stock Market (U.S. Companies) Total Return Index and The Nasdaq
Pharmaceutical Stocks Total Return Index for the period from December 31, 1995
through December 31, 2000. The graph assumes $100 was invested in ImClone common
stock and each of the indexes at the beginning of such period. The Nasdaq Stock
Market (U.S. Companies) Total Return Index comprises all domestic common shares
traded on the Nasdaq National Market and the Nasdaq SmallCap Market. The Nasdaq
Pharmaceutical Stocks Total Return Index represents all companies, including
biotechnology companies, trading on Nasdaq classified under the Standard
Industrial Classification Code for pharmaceuticals.
COMPARISON OF FIVE YEAR TOTAL RETURN AMONG IMCLONE COMMON STOCK,
NASDAQ STOCK MARKET (U.S. COMPANIES) TOTAL RETURN INDEX
AND NASDAQ PHARMACEUTICAL STOCKS TOTAL RETURN INDEX
IMCLONE SYSTEMS NASDAQ U.S. STOCKS NASDAQ PHARMACEUTICAL
--------------- ------------------ ---------------------
12/31/95 100 100 100
12/31/96 128 123 100
12/31/97 107 151 104
12/31/98 119 213 132
12/31/99 520 395 248
12/31/00 577 238 308
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REPORT OF THE AUDIT COMMITTEE
Notwithstanding anything to the contrary set forth in any of the Company's
previous or future filings under the Securities Act of 1933, as amended or the
Exchange Act that might incorporate this proxy statement or future filings with
the SEC, in whole or in part, the following report shall not be deemed to be
incorporated by reference into any such filing.
MEMBERSHIP AND ROLE OF THE AUDIT COMMITTEE
The Audit Committee (the "Audit Committee") consists of the following
members of the Company's Board of Directors: Paul B. Kopperl, Chairman, Richard
Barth and William R. Miller. During 2000, Vincent T. DeVita, Jr. also served on
the Audit Committee. Each of the members of the Audit Committee is "independent"
as defined under the National Association of Securities Dealers' listing
standards. The Audit Committee operates under the written charter adopted by the
Board of Directors which is included in this proxy statement as Appendix A.
The primary functions of the Audit Committee are to monitor the integrity
of the Company's financial reporting process and systems of internal controls
regarding finance, accounting and legal compliance and to provide an avenue of
communication among the independent auditors, management and the Board of
Directors. The primary duties and responsibilities of the Audit Committee are to
(i) review the Company's annual audited financial statements prior to filing
with the SEC or distribution to the public; (ii) in consultation with management
and the independent auditors, consider the integrity of the Company's financial
reporting procedures and controls; (iii) review with management and the
independent auditors the Company's quarterly financial statements prior to
filing with the SEC or distribution to the public; (iv) periodically perform
self-assessment of Audit Committee performance; (v) annually review policies and
procedures as well as test results associated with directors' and officers'
expense accounts and perquisites; and (vi) annually review a summary of
directors' and officers' related party transactions and potential conflicts of
interest. The Audit Committee also reviews the performance of the independent
auditors and their fees and recommends their selection and engagement to the
Board of Directors.
REVIEW OF THE COMPANY'S AUDITED FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2000.
The Audit Committee reviewed and discussed the audited financial statements
of the Company for the fiscal year ended December 31, 2000 with the Company's
management and with KPMG LLP, the Company's certified independent public
accountants. Such review and discussions included the matters required to be
discussed by Statement on Auditing Standards No. 61 (Communication with Audit
Committees).
The Audit Committee also reviewed the written disclosures and the letter
from KPMG LLP required by Independence Standards Board Standard No. 1
(Independence Discussion with Audit Committees) and discussed the independence
of KPMG LLP with the Company's management and with that firm.
Based on the Audit Committee's review and discussions noted above, the
Audit Committee recommended to the Board of Directors that the Company's audited
financial statements be included in the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 2000 for filing with the SEC. The Audit
Committee and Board of Directors have recommended, subject to ratification by
the stockholders, that KPMG LLP be selected as the Company's independent
certified public accountants for the fiscal year ending December 31, 2001.
The Audit Committee held three meetings during the fiscal year ended
December 31, 2000. The meetings were designed to facilitate and encourage
private communication among members of the Audit Committee, the Company's
independent certified public accountants and the Company's internal staff
responsible for accounting and legal matters.
Audit Committee
Paul B. Kopperl, Chairman
William R. Miller
Richard Barth
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PROPOSAL NO. 2
RATIFICATION OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Audit Committee and the Board have selected KPMG LLP as independent
certified public accountants for the Company for the year ending December 31,
2001. KPMG LLP has served as the Company's auditor since 1988. The ratification
of the selection of independent certified public accountants is to be voted upon
at the meeting, and it is intended that the persons named in the accompanying
proxy will vote for KPMG LLP. Representatives of KPMG LLP are expected to attend
the meeting, to have an opportunity to make a statement if they desire to do so
and to be available to respond to appropriate questions.
AUDIT FEES
The aggregate fees billed by KPMG LLP in connection with its audit of the
Company's annual financial statements for the year 2000 and its review of the
financial statements included in the Company's Form 10-Qs during 2000 was
$88,300.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
The Company did not engage KPMG LLP to provide services for the Company
regarding financial information systems design and implementation during 2000.
ALL OTHER FEES
KPMG LLP billed the Company fees totaling $149,040 for all other services
performed during 2000 which related to tax consulting and compliance; the
Company's February 2000 offering of 5 1/2% convertible notes; various other SEC
filings; and various technical accounting consultation. The Audit Committee has
considered whether the provision of all other services by KPMG LLP is compatible
with maintaining KPMG LLP's independence and concluded that KPMG LLP is
"independent".
THE BOARD RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE SELECTION OF KPMG
LLP TO ACT AS THE COMPANY'S INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS FOR THE
YEAR ENDING DECEMBER 31, 2001 (PROPOSAL NO. 2 ON YOUR PROXY CARD).
STOCKHOLDER PROPOSALS
A stockholder proposal intended to be presented at the Company's Annual
Meeting of Stockholders to be held in 2002 must be received by the Company on or
before January 1, 2002 in order to be included in the Company's proxy statement
and form of proxy relating to that meeting.
Please complete, sign and date the enclosed proxy card, which is revocable
as described herein, and mail it promptly in the enclosed postage-paid envelope.
By Order of the Board of Directors
/s/ John B. Landes
John B. Landes
Secretary
New York, New York
April 23, 2001
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. WE URGE YOU TO FILL IN, SIGN
AND RETURN THE ACCOMPANYING PROXY CARD NO MATTER HOW LARGE OR SMALL YOUR
HOLDINGS MAY BE.
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24
APPENDIX A
IMCLONE SYSTEMS INCORPORATED
CHARTER OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
I. AUDIT COMMITTEE PURPOSE
The Audit Committee is appointed by the Board of Directors to assist the
Board in fulfilling its oversight responsibilities. The Audit Committee's
primary duties and responsibilities are to:
- Monitor the integrity of the Company's financial reporting process and
systems of internal controls regarding finance, accounting, and legal
compliance.
- Monitor the independence and performance of the Company's independent
auditors.
- Provide an avenue of communication among the independent auditors,
management, and the Board of Directors.
The Audit Committee has the authority to conduct any investigation
appropriate to fulfilling its responsibilities, and it has direct access to the
independent auditors as well as anyone in the organization. The Audit Committee
has the ability to retain, at the Company's expense, special legal, accounting,
or other consultants or experts it deems necessary in the performance of its
duties.
II. AUDIT COMMITTEE COMPOSITION AND MEETINGS
Audit Committee members shall meet the requirements of the NASD. The Audit
Committee shall be comprised of three or more directors as determined by the
Board, each of whom shall be independent non-executive directors, free from any
relationship that would interfere with the exercise of his or her independent
judgment. All members of the Committee shall have a basic understanding of
finance and accounting and be able to read and understand fundamental financial
statements, and at least one member of the Committee shall have accounting or
related financial management expertise.
Audit Committee members shall be appointed by the Board. If an audit
committee Chair is not designated or present, the members of the Committee may
designate a Chair by majority vote of the Committee membership.
The Committee shall meet approximately three times annually, or more
frequently as circumstances dictate. The Audit Committee Chair shall prepare
and/or approve an agenda in advance of each meeting. The Committee should meet
privately in executive session at least annually with management, the
independent auditors, and as a committee to discuss any matters that the
Committee or each of these groups believe should be discussed. In addition, the
Committee, or at least its Chair, should communicate with management and the
independent auditors quarterly to review the Company's financial statements and
significant findings based upon the auditor's review procedures.
III. AUDIT COMMITTEE RESPONSIBILITIES AND DUTIES
Review Procedures
1. Review and reassess the adequacy of this Charter at least annually.
Submit the Charter to the Board of Directors for approval and have the
document published in accordance with Securities and Exchange
Commission regulations.
2. Review the Company's annual audited financial statements prior to
filing or distribution. Review should include discussion with
management and independent auditors of significant issues regarding
accounting principles, practices, and judgments.
3. In consultation with management and the independent auditors, consider
the integrity of the Company's financial reporting processes and
controls. Discuss significant financial risk exposures and
A-1
25
the steps management has taken to monitor, control, and report such
exposures. Review significant findings prepared by the independent
auditors together with management's responses.
4. Review with financial management and the independent auditors the
Company's quarterly financial results prior to the release of earnings
and/or the Company's quarterly financial statements prior to filing or
distribution. Discuss any significant changes to the Company's
accounting principles and any items required to be communicated by the
independent auditors in accordance with SAS 61. The Chair of the
Committee may represent the entire Audit Committee for purposes of this
review.
5. Periodically perform self-assessment of Audit Committee performance.
6. Annually review policies and procedures as well as test results
associated with directors' and officers' expense accounts and
prerequisites. Annually review a summary of directors' and officers'
related party transactions and potential conflicts of interest.
Independent Auditors
7. The independent auditors are ultimately accountable to the Audit
Committee and the Board of Directors. The Audit Committee shall review
the independence and performance of the auditors and annually recommend
to the Board of Directors the appointment of the independent auditors
or approve any discharge of auditors when circumstances warrant.
8. On an annual basis, the Committee should review and discuss with the
independent auditors all significant relationships they have with the
Company that could impair the auditors' independence.
9. Review the independent auditors audit plan -- discuss scope, staffing,
locations, reliance upon management, and general audit approach.
10. Prior to releasing the year-end earnings, discuss the results of the
audit with the independent auditors. Discuss certain matters required
to be communicated to audit committees in accordance with AICPA SAS 61.
11. Consider the independent auditors' judgments about the quality and
appropriateness of the Company's accounting principles as applied in
its financial reporting.
Legal Compliance
12. On at least an annual basis, review with the Company's counsel, any
legal matters that could have a significant impact on the
organization's financial statements, the Company's compliance with
applicable laws and regulations, and inquiries received from regulators
or governmental agencies.
Other Audit Committee Responsibilities
13. Annually prepare a report to shareholders as required by the Securities
and Exchange Commission. The report should be included in the Company's
annual proxy statement.
14. Perform any other activities consistent with this Charter, the
Company's by-laws, and governing law, as the Committee or the Board
deems necessary or appropriate.
15. Maintain minutes of meetings and periodically report to the Board of
Directors on significant results of the foregoing activities.
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26
Appendix B
IMCLONE SYSTEMS INCORPORATED
Dear Stockholder:
Please take note of the important information enclosed with this Proxy
Ballot. There are a number of issues related to the management and operation of
your Company that require your immediate attention and approval. These are
discussed in detail in the enclosed proxy materials.
Your vote counts, and you are strongly encouraged to exercise your right to
vote your shares.
Please mark the boxes on this proxy card to indicate how your shares shall
be voted, then sign the card, detach it and return your proxy vote in the
enclosed postage paid envelope.
Your vote must be received prior to the Annual Meeting of Shareholders, May
24, 2001.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
ImClone Systems Incorporated
IMCLONE SYSTEMS INCORPORATED
PROXY FOR THE MEETING OF STOCKHOLDERS, MAY 24, 2001
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Robert F. Goldhammer, John B. Landes and Samuel
D. Waksal as Proxies each with power of substitution and hereby authorizes each
of them to represent and to vote, as designated below, all the shares of Common
Stock of ImClone Systems Incorporated held of record by the undersigned on April
9, 2001 at the Annual Meeting of Stockholders to be held at 10:00 a.m. on May
24, 2001 or any adjournment thereof.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY TO EQUISERVE, THE COMPANY'S
TRANSFER AGENT, TO BE RECEIVED NO LATER THAN MAY 23, 2001.
This Proxy when properly executed will be voted in the manner directed herein by
the undersigned stockholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR PROPOSALS 1,2 and 3.
PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) ON THIS CARD. ALL JOINT
OWNERS SHOULD SIGN. WHEN SIGNING AS EXECUTOR, ADMINISTRATOR, ATTORNEY, TRUSTEE
OR GUARDIAN OR AS CUSTODIAN FOR A MINOR, PLEASE GIVE FULL TITLE AS SUCH. IF A
CORPORATION, PLEASE SIGN IN FULL CORPORATE NAME AND INDICATE THE SIGNER'S
OFFICE. IF A PARTNER, SIGN THE PARTNERSHIP NAME.
HAS YOUR ADDRESS CHANGED?
DO YOU HAVE ANY COMMENTS?
27
[X] PLEASE MARK VOTES AS IN THIS EXAMPLE
Mark box at right if you plan to attend the meeting [ ]
Mark box at right if an address change or comment has been noted on the reverse
side of this card [ ]
RECORD DATE SHARES:
1) ELECTION OF DIRECTORS. For: [ ] Withhold: [ ] For All Except: [ ]
Nominees:
Richard Barth
Vincent T. DeVita. Jr.
Robert F. Goldhammer
Paul B. Kopperl
David M. Kies
Arnold Levine
John Mendelsohn
William R. Miller
Harlan W. Waksal
Samuel D. Waksal
NOTE: IF YOU DO NOT WISH YOUR SHARES VOTED "FOR" A PARTICULAR NOMINEE, MARK THE
"FOR ALL EXCEPT" BOX AND STRIKE A LINE THROUGH THE NAME(S) OF THE NOMINEE(S).
YOUR SHARES SHALL BE VOTED FOR THE REMAINING NOMINEE(S).
2) To ratify the appointment of KPMG LLP to serve as the Company's independent
certified public accountants for the fiscal year ending December 31, 2001.
For: [ ] Against: [ ] Abstain: [ ]
3) To consider and act upon any other business as may come before the meeting
or any adjournment thereof.
[ ] PLEASE CHECK THIS BOX IF YOU EXPECT TO ATTEND THE MEETING
Please be sure to sign and date this Proxy.
Date:
___________________________________________________________
Stockholder sign here
___________________________________________________________
Co-owner sign here