UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
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 Rule 14a-11(c) or Rule 14a-12
UNITED THERAPEUTICS CORPORATION
(Name of Registrant as Specified In Its Charter)
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.
[ ] 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.
[United Therapeutics Logo]
1110 SPRING STREET
SILVER SPRING, MD 20910
NOTICE OF
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 26, 2002
NOTICE IS HEREBY GIVEN that the 2002 annual meeting of stockholders of
United Therapeutics Corporation, a Delaware corporation, will be held at the
Hilton Melbourne Beach Oceanfront, 3003 North Highway A1A, Indialantic, Florida
32903, on Wednesday, June 26, 2002, at 9:00 a.m. Eastern Time, for the following
purposes:
1. To elect Class III directors; and
2. To transact such other business as may properly come before the meeting
and all adjournments thereof.
The Board of Directors has fixed April 29, 2002 as the record date for the
determination of the stockholders entitled to notice of, and to vote at, the
annual meeting and all adjournments thereof. A list of stockholders entitled to
vote at the annual meeting will be available for examination by any stockholder
at United Therapeutics' principal executive offices not less than ten days prior
to the annual meeting and at the annual meeting.
By the order of the Board of
Directors,
[Paul A. Mahon Signature]
Paul A. Mahon
Corporate Secretary and General
Counsel
May 6, 2002
Silver Spring, Maryland
EVEN IF YOU EXPECT TO ATTEND THE MEETING IN PERSON, PLEASE MARK, DATE AND
SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED RETURN ENVELOPE, WHICH
DOES NOT REQUIRE POSTAGE IF MAILED IN THE UNITED STATES. STOCKHOLDERS WHO ATTEND
THE MEETING MAY REVOKE THEIR PROXIES AND VOTE IN PERSON IF THEY DESIRE.
UNITED THERAPEUTICS CORPORATION
1110 SPRING STREET
SILVER SPRING, MD 20910
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 26, 2002
This proxy statement is solicited on behalf of the Board of Directors in
connection with the annual meeting of stockholders to be held on Wednesday, June
26, 2002 at 9:00 a.m. Eastern Time, at the Hilton Melbourne Beach Oceanfront,
3003 North Highway A1A, Indialantic, Florida 32903, and all adjournments
thereof. This proxy statement along with the accompanying proxy card is being
mailed to stockholders commencing on or about May 6, 2002.
PROXY PROCEDURE
If the enclosed proxy card is properly executed and returned prior to the
meeting, the shares represented by the proxy card will be voted in accordance
with the stockholder's directions or, if no directions are indicated, the shares
will be voted in accordance with the recommendation of the Board of Directors as
specified in this proxy statement. If the enclosed proxy is executed and
returned to United Therapeutics, it nevertheless may be revoked at any time
before it is exercised by (i) written notice to the Corporate Secretary of
United Therapeutics at the company's principal executive offices at 1110 Spring
Street, Silver Spring, Maryland 20910, (ii) by properly submitting to the
Corporate Secretary at the company's principal executive offices a duly executed
proxy bearing a later date, or (iii) by attending the meeting and voting in
person.
PROXY SOLICITATION
All costs of solicitation of proxies will be borne by United Therapeutics.
In addition to the solicitation of proxies by use of the mails, United
Therapeutics may utilize the services of the officers and regular employees of
United Therapeutics (who will receive no compensation therefore in addition to
their regular salaries) to solicit proxies personally and by telephone. United
Therapeutics will request banks, brokers, custodians, nominees and fiduciaries
to forward copies of the proxy solicitation materials to beneficial owners and
to request authority for the execution of proxies. United Therapeutics will
reimburse such persons or entities for their expenses in doing so.
VOTING AT MEETING
Only holders of record of the common stock of United Therapeutics at the
close of business on April 29, 2002 are entitled to notice of, and to vote
either in person or by proxy, at the annual meeting. At the close of business on
April 29, 2002, there were 20,225,220 shares of common stock outstanding. Each
share of common stock held as of the record date is entitled to one vote on each
matter submitted to a vote at a meeting of stockholders.
A majority of the outstanding shares of common stock on the record date,
present in person or by proxy, will constitute a quorum for the transaction of
business at the annual meeting. Shares of common stock represented by proxies
that are marked "without authority" with respect to the election of any one or
more nominees for election as directors, or that abstain from voting, will be
counted for the purpose of determining whether there is a quorum for the
transaction of business at the annual meeting. Broker non-votes will be treated
as not represented at the annual meeting as to any matter for which a non-vote
is indicated on the broker's proxy.
The affirmative vote of a plurality of the shares present in person or
represented by proxy at the annual meeting is required to elect directors.
"Plurality" means that the nominees who receive the largest number of votes cast
are elected as directors up to the maximum number of directors to be elected at
the annual meeting. Consequently, any shares represented at the annual meeting
but not voted for any reason have no impact on the election of directors.
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ELECTION OF DIRECTORS
United Therapeutics' Amended and Restated Certificate of Incorporation and
Amended and Restated Bylaws provide that the Board of Directors shall consist of
not less than five and not more than twenty directors, the exact number to be
determined from time to time by resolution of the Board of Directors. By
resolution, the Board of Directors has currently set the number of directors at
seven. The Amended and Restated Certificate of Incorporation also provides for a
classified Board of Directors divided into three classes whose terms expire at
different times. At the annual meeting, two Class III directors will be elected
to the Board of Directors. Each Class III director will be elected to serve a
term of three years expiring in 2005.
The Board of Directors has no reason to doubt the availability of its
nominees, and each nominee has indicated a willingness to serve if elected. If
any nominee declines or is unable to serve for any reason, it is intended that,
at the discretion of the Board of Directors, the Board of Directors will appoint
a replacement director or the size of the Board will be reduced. Stockholders
voting at the annual meeting may not vote for more than the number of nominees
listed in this proxy statement.
The persons named on the enclosed proxy card intend to vote such proxy for
the election of the two nominees named below as Class III directors of United
Therapeutics, unless the stockholder indicates on the proxy card that the vote
should be withheld or contrary directions are indicated. If the proxy card is
signed and returned without any direction given, shares of stock represented by
the proxy will be voted FOR the election of the two nominees named on the proxy
card. Neither nominee for election has yet served on the Board of Directors.
INFORMATION REGARDING NOMINEES FOR CLASS III DIRECTORS
TO BE ELECTED FOR TERMS EXPIRING IN 2005
Raymond Dwek, F.R.S. (age 60) currently serves as Director of the
Glycobiology Institute, Professor of Glycobiology, and Chairman of the
Department of Biochemistry at the University of Oxford. Professor Dwek is the
scientific founder of Oxford GlycoSciences PLC, which is publicly traded on the
London Stock Exchange and currently serves as a member of its Board of
Directors. Professor Dwek is a co-discoverer of United Therapeutics' flavovirus
entry inhibitor platform.
Roger Jeffs, Ph.D. (age 40) joined United Therapeutics in September of 1998
as Director of Research, Development and Medical. Dr. Jeffs was promoted to Vice
President of Research, Development and Medical in July 2000 and to President and
Chief Operating Officer in January 2001. Prior to 1998, Dr. Jeffs worked at
Amgen, Inc. as Manager of Clinical Affairs and Associate Director of Clinical
Research from 1995 to 1998. Prior to Amgen, Dr. Jeffs worked in the clinical
research group of Burroughs Welcome Co, and as a technical expert with the
Washington D.C. patent law firm, Cushman, Darby and Cushman.
INFORMATION REGARDING CONTINUING CLASS I DIRECTORS
(TERMS EXPIRING IN 2003)
Raymond Kurzweil (age 54) was appointed by the Board of Directors of United
Therapeutics to serve as a Class I director effective January 3, 2002 to fill a
vacancy. Mr. Kurzweil is an inventor, entrepreneur, and author, and has created
several important technologies in the artificial intelligence field. He has
received the National Medal of Technology, the MIT-Lemelson Prize, ten honorary
doctorates, and honors from three U.S. Presidents. Mr. Kurzweil was selected as
a 2002 inductee into the National Inventors Hall of Fame. Mr. Kurzweil has
served as the Chief Executive Officer of Medical Learning Company, a joint
venture with the American Board of Family Practice that provides professional
quality instructional material to physicians, since 1998. He also serves as a
member of the board of directors of Inforte Corp., a publicly traded technology
consulting company.
Martine A. Rothblatt, Ph.D., J.D., M.B.A. (age 47) started United
Therapeutics in 1996 and has served as Chairman and Chief Executive Officer
since its inception. Dr. Rothblatt previously launched and ran several
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satellite communications companies. Dr. Rothblatt is also Chairman of the Law
and Medicine Committee of the International Bar Association and President of the
William Harvey Medical Research Foundation.
INFORMATION REGARDING CONTINUING CLASS II DIRECTORS
(TERMS EXPIRE IN 2004)
Ricardo Balda, M.S. (age 60) was appointed as the Chief Executive Officer
of Medicomp, Inc. upon its acquisition by Unither Telemedicine Services Corp., a
wholly owned subsidiary of United Therapeutics, in December 2000 and appointed
to the Board of Directors in December 2000. In 1983, Mr. Balda founded Medicomp
and served as its Chairman and President until the acquisition. In 1998, Mr.
Balda founded Telemedical Procedures, LLC, which was also acquired by Unither
Telemedicine Services Corp. in December 2000. Mr. Balda currently serves on the
Board of Advisors of the Florida Institute of Technology. Prior to founding
Medicomp and Telemedical Procedures, Mr. Balda served as General Manager of the
Diagnostic Cardiology Division of Hewlett Packard and was the Chief Operating
Officer of Marquette Electronics.
Henry Beecher Hicks, III, M.B.A. (age 34) is a principal at Katalyst
L.L.C., a venture capital, operational and merchant banking firm. Prior to
joining Katalyst L.L.C., Mr. Hicks served Bank of America from 1995 through 2000
as Vice President of the Catalyst Equity Fund and as Vice President with Banc of
America Securities LLC. From 1993 to 1995, Mr. Hicks served as Senior Associate
with PricewaterhouseCoopers LLP in the firm's mergers & acquisitions practice.
In 1998, Mr. Hicks was appointed by President Clinton to serve as a White House
Fellow. Mr. Hicks has served on the United Therapeutics Board of Directors since
May 2000.
Michael C. Miles, M.B.A. (age 46) co-founded McManus & Miles, an investment
banking firm specializing in financial advisory and private placement services,
in 1989 and served as managing director and board member from 1989 until
December 2000 when he retired from the firm. Prior to co-founding McManus &
Miles and since 1982, Mr. Miles served at The First Boston Corporation where he
specialized in merger and project related financings. Mr. Miles has served on
the United Therapeutics Board of Directors since May 2000.
There are no family relationships between or among any director, director
nominee and executive officer of United Therapeutics.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR"
THE ELECTION OF BOTH OF THE ABOVE-NAMED NOMINEES AS CLASS III DIRECTORS OF
UNITED THERAPEUTICS.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth certain information with respect to the
beneficial ownership of United Therapeutics' common stock as of March 30, 2002
by each person who United Therapeutics knows owns more than 5% of its common
stock, each of the company's directors, each of its named executive officers,
and all of its directors and executive officers as a group. Unless otherwise
noted, the address of each person listed below is the company's address.
Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes ownership of those
shares over which the person has voting or investment power. Beneficial
ownership also includes ownership of shares of stock subject to rights, options
and warrants currently exercisable or convertible, or exercisable or convertible
within 60 days of the date of this table. Percentage of beneficial ownership is
based on 21,283,792 shares of common stock outstanding. Unless otherwise
indicated, to the knowledge of United Therapeutics, all persons listed have sole
voting and
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investment power with respect to their shares of common stock, except to the
extent authority is shared by spouses under applicable law.
NUMBER OF SHARES
OF COMMON STOCK PERCENTAGE OF
NAME BENEFICIALLY OWNED OUTSTANDING SHARES
---- ------------------ ------------------
Noah A. Samara, J.D., M.B.D.(1)............................. 2,209,574 10.4%
Martine A. Rothblatt, Ph.D., J.D., M.B.A. (2)............... 1,804,842 8.5%
AXA Financial, Inc. (3)..................................... 1,361,780 6.4%
New York, NY 10104
1290 Avenue of the Americas
S.A.C. Capital Advisors LLC (4)............................. 1,317,900 6.2%
777 Long Ridge, Building A
Stamford, CT 06902-1200
Capital Research & Management Company (4)................... 1,305,000 6.1%
333 South Hope Street, 55th floor
Los Angeles, CA 90071-1447
Quaker Capital Management Corporation (4)................... 1,040,000 4.9%
Arrott Building, 401 Wood Street Suite 1300
Pittsburgh, PA 15222-1824
Shelmer Blackburn, Jr. (5).................................. 434,756 2.0%
Roger Jeffs, Ph.D. (6)...................................... 124,894 *
Paul Mahon, J.D. (7)........................................ 45,099 *
Fred T. Hadeed, C.P.A. (8).................................. 42,274 *
David Walsh, Ph.D. (9)...................................... 35,977 *
David A. Gooray (10)........................................ 30,695 *
Barry B. Kanarek, M.D., Ph.D. (11).......................... 29,050 *
Michael C. Miles, M.B.A. (12)............................... 21,700 *
Darlene Walley, Ph.D. (13).................................. 20,400 *
Ricardo Balda, M.S. (14).................................... 17,400 *
Raymond Dwek, F.R.S. (15)................................... 13,334 *
Raymond Kurzweil (16)....................................... 11,000 *
H. Beecher Hicks, M.B.A. (17)............................... 8,200 *
All directors and executive officers as a group (12 persons)
(18)...................................................... 4,849,195 22.8%
---------------
* Represents less than one percent.
(1) Beneficial ownership information obtained from Schedule 13G/A as filed with
the Securities and Exchange Commission on February 14, 2002 by Noah Samara.
Includes 4,000 shares of common stock issuable upon exercise of stock
options.
(2) Includes 16,660 shares held by Dr. Rothblatt's minor children and 371,731
shares of common stock held by her spouse. Also includes 654,932 shares of
common stock issuable upon exercise of stock options held by Dr. Rothblatt
and 1,468 shares of common stock issuable upon exercise of stock options
held by her spouse. Dr. Rothblatt disclaims beneficial ownership of all
shares and options held by her spouse and children.
(3) Beneficial ownership information obtained from a Schedule 13G filed on
February 11, 2002 by AXA Financial, Inc., AXA (which owns AXA Financial,
Inc.), and AXA Conseil Vie Assurance Mutuelle, AXA Assurances I.A.R.D.
Mutuelle, AXA Assurances Vie Mutuelle and AXA Courtage Assurance Mutuelle
(which as a group control AXA). As disclosed in the AXA Schedule 13G, AXA
Financial, Inc. is filing in its capacity as a parent holding company with
respect to the holdings of its subsidiaries, Alliance Capital Management
L.P. and The Equitable Life Assurance Society of the United States.
(4) Beneficial ownership information obtained from a Schedule 13G or 13G/A
filed by the named beneficial holder in February 2002. This information is
as of the Schedule 13G or 13G/A filing date.
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(5) Includes 72,740 shares of common stock issuable upon exercise of stock
options.
(6) Includes 109,398 shares of common stock issuable upon exercise of stock
options.
(7) Includes 33,099 shares of common stock issuable upon exercise of stock
options.
(8) Includes 41,274 shares of common stock issuable upon exercise of stock
options.
(9) Includes 32,977 shares of common stock issuable upon exercise of stock
options.
(10) Includes 6,100 shares of common stock issuable upon exercise of stock
options.
(11) Includes 28,050 shares of common stock issuable upon exercise of stock
options.
(12) Includes 9,200 shares of common stock issuable upon exercise of stock
options.
(13) Includes 20,400 shares of common stock issuable upon exercise of stock
options.
(14) Includes 12,400 shares of common stock issuable upon exercise of stock
options.
(15) Includes 13,334 shares of common stock issuable upon exercise of stock
options.
(16) Includes 11,000 shares of common stock issuable upon exercise of stock
options.
(17) Includes 8,200 shares of common stock issuable upon exercise of stock
options.
(18) Includes 1,058,572 shares of common stock issuable upon exercise of stock
options.
BOARD MEETINGS AND COMMITTEES;
COMPENSATION OF DIRECTORS
BOARD OF DIRECTORS
The Board of Directors met eight times in 2001. The Board of Directors has
a compensation committee, an audit committee and a nominating committee. Except
for Dr. Gooray, each director attended at least seventy-five percent of all
meetings of the Board of Directors and committees on which he or she served in
2001.
COMPENSATION COMMITTEE
Members: David Gooray, M.D. and Michael C. Miles, M.B.A. (Chair)
The Compensation Committee met seven times in 2001. The Compensation
Committee is responsible for the overall design, approval and implementation of
the executive compensation plans, policies and programs for officers and other
key executives of United Therapeutics. The Compensation Committee
responsibilities include: determining compensation levels, based on information
about compensation levels of other companies, company performance, stockholder
return and individual performance, for executive officers of United Therapeutics
and administering United Therapeutics' equity incentive plan.
AUDIT COMMITTEE
Members: H. Beecher Hicks, III, M.B.A. (Chair), Michael C. Miles, M.B.A.
and David Gooray, M.D.
The Audit Committee met five times during 2001. Each member of the Audit
Committee is "independent" as defined in the Nasdaq listing standards. The Audit
Committee responsibilities include: reviewing written disclosures and letters
from United Therapeutics' independent auditors; evaluating the qualifications,
performance and independence of the independent auditors; meeting with the
independent auditors in advance of the annual audit to review the scope of the
proposed annual audits and quarterly reviews; approving the compensation of the
independent auditors; reviewing with independent auditors any matters required
to be discussed pursuant to Statement of Auditing Standards No. 61; reviewing
and discussing with management and independent auditors financial statements
proposed to be included in United Therapeutics' Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q and make recommendations regarding inclusion of
financial statements in Annual Report on Form 10-K; and discussing annually with
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independent auditors the adequacy and effectiveness of United Therapeutics'
internal controls and assessing progress management has made in addressing
issues raised by independent auditors.
NOMINATING COMMITTEE
Members: Martine A. Rothblatt, Ph.D., J.D., M.B.A. (Chair) and Raymond
Kurzweil
The Nominating Committee met one time in 2001 to consider and make
recommendations to the full Board of Directors concerning the slate of director
nominees for the 2002 annual meeting of stockholders. The Nominating Committee
reviews and recommends candidates for the Board of Directors. The Nominating
Committee will consider nominees recommended by stockholders. The procedure for
nominating a director at the 2003 annual meeting of stockholders is described
under "STOCKHOLDER PROPOSALS AND DIRECTOR NOMINATIONS" below.
DIRECTOR COMPENSATION
Each director who is not also an employee of United Therapeutics receives a
fee of $8,000 per year. Each non-employee director is also granted a
non-qualified option to purchase 1,000 shares of United Therapeutics common
stock for each meeting attended by the director. Such options are exercisable at
a price equal to the closing price of the stock as reported on Nasdaq on the
date of the meeting. United Therapeutics reimburses each member of its Board of
Directors for out-of-pocket expenses incurred in connection with attending Board
meetings.
MANAGEMENT
The following table sets forth certain summary information concerning the
compensation awarded to or earned by United Therapeutics' Chief Executive
Officer, the four most highly compensated executive officers who earned in
excess of $100,000 in cash compensation during the year ended December 31, 2001
and the most highly compensated executive officer who earned in excess of
$100,000 in cash compensation during the year ended December 31, 2001 but was no
longer serving as an executive officer at December 31, 2001.
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION ------------
---------------------------------- SECURITIES
OTHER ANNUAL UNDERLYING
NAME AND PRINCIPAL POSITION IN 2001 YEAR SALARY BONUS COMPENSATION OPTIONS(#)
----------------------------------- ---- -------- -------- ------------ ------------
Martine A. Rothblatt...................... 2001 $296,275 $ 12,641 $ -- 7,200
Chairman and Chief Executive Officer 2000 244,166 109,489 -- 503,000
1999 167,340 18,000 -- 80,000
Roger Jeffs (1)........................... 2001 250,000 9,232 130,000
President and Chief Operating Officer 2000 181,127 154,010 -- 124,400
Darlene Walley (2)........................ 2001 205,374 14,260 -- 4,800
President and Chief Executive Officer,
Unither Pharma, Inc.
Barry B. Kanarek (3)...................... 2001 202,500 7,851 --
Chief Medical Officer, President and 2000 80,208 87,498 -- 4,000
Chief Operating Officer, Unither
Pharmaceuticals, Inc.
Shelmer D. Blackburn, Jr. (4)............. 2001 200,000 8,176 -- 4,000
Vice President for Operations 2000 161,466 82,085 -- 2,148
1999 113,000 11,300 -- 20,000
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LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION ------------
---------------------------------- SECURITIES
OTHER ANNUAL UNDERLYING
NAME AND PRINCIPAL POSITION IN 2001 YEAR SALARY BONUS COMPENSATION OPTIONS(#)
----------------------------------- ---- -------- -------- ------------ ------------
Ricardo Balda (5)......................... 2001 $192,308 $ 7,046 $49,324 4,800
Chief Executive Officer, Medicomp, Inc.,
and Director
---------------
(1) Dr. Jeffs became an executive officer of United Therapeutics in July of
2000.
(2) Dr. Walley became an executive officer of United Therapeutics in January
2001 following the acquisition of Cooke Pharma, Inc. by United Therapeutics.
Dr. Walley left United Therapeutics in December 2001.
(3) Dr. Kanarek became an executive officer of United Therapeutics in March
2001.
(4) Mr. Blackburn left United Therapeutics in January 2002.
(5) Mr. Balda became an executive officer and director of United Therapeutics in
January 2001 following the December 2000 acquisition of Medicomp, Inc. by
United Therapeutics.
STOCK OPTION GRANTS AND EXERCISES
The following tables show for the year ended December 31, 2001 certain
information regarding options granted to, and held at year-end by, the named
executive officers. Each of the options listed in the table below was granted
pursuant to United Therapeutics' Amended and Restated Equity Incentive Plan. The
percentages shown in the first table are based on an aggregate of 624,930
options granted to employees in 2001, including the named executive officers.
The exercise price per share of each option was equal to the fair market value
of the common stock on the date of grant.
OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
---------------------------------------------------------- POTENTIAL REALIZABLE VALUE AT
% OF TOTAL ASSUMED ANNUAL RATES OF
NUMBER OF OPTIONS STOCK PRICE APPRECIATION
SECURITIES GRANTED TO EXERCISE FOR OPTION TERM
UNDERLYING OPTIONS EMPLOYEES IN PRICE PER EXPIRATION -----------------------------
NAME GRANTED(#) FISCAL YEAR SHARE DATE 5% 10%
---- ------------------ ------------ --------- ---------- ------------- -------------
Martine A. Rothblatt....... 6,000 0.96% $11.31 4/11 $ 42,677 $ 108,151
1,200 0.19 9.20 12/11 6,943 17,595
Roger Jeffs................ 5,000 0.80 11.31 4/11 35,564 90,126
125,000 20.00 14.12 1/11 1,110,392 2,813,952
Darlene Walley............. 800 0.13 9.20 12/11 4,629 11,730
4,000 0.64 11.31 4/11 28,451 72,101
Barry B. Kanarek........... 4,000 0.64 11.31 4/11 28,451 72,101
Shelmer D. Blackburn,
Jr....................... 4,000 0.64 11.31 4/11 28,451 72,101
Ricardo Balda.............. 800 0.13 9.20 12/11 4,629 11,730
4,000 0.64 11.31 4/11 28,451 72,101
Amounts reported in the potential realizable value column above are
hypothetical values that may be realized upon exercise of the options
immediately prior to the expiration of their term, calculated by assuming that
the stock price on the date of grant as determined by the Board of Directors
appreciates at the indicated annual rate compounded annually for the entire term
of the option (10 years). The 5% and 10% assumed rates of appreciation are
mandated by the rules of the Securities and Exchange Commission and do not
represent United Therapeutics' estimate or projection of the future common stock
price.
In the following table, the value of unexercised in-the-money options at
December 31, 2001 is based on the closing bid price of $10.43, less the exercise
price, without taking into account any taxes that may be payable in connection
with the transaction, multiplied by the number of shares underlying the option.
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FISCAL YEAR-END OPTION VALUES
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
DECEMBER 31, 2001(#) DECEMBER 31, 2001($)
------------------------------ ---------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ------------- ----------- -------------
Martine A. Rothblatt.......................... 638,598 101,601 $ 726 $ 726
Roger Jeffs................................... 81,898 174,335 69,143 138,330
Darlene Walley................................ 20,400 0 484 0
Barry B. Kanarek.............................. 26,050 19,000 0 0
Shelmer D. Blackburn, Jr...................... 66,073 45,667 24,698 0
Ricardo Balda................................. 10,400 34,400 484 484
EXECUTIVE OFFICER EMPLOYMENT AGREEMENTS
In April 1999, United Therapeutics entered into an Executive Employment
Agreement with Martine A. Rothblatt, its Chief Executive Officer. The employment
agreement provides for an initial five-year term ending on December 31, 2004,
and automatically renews for successive one-year periods after each year, unless
either party terminates the agreement. The annual salary specified in the
agreement was increased from $180,000 to $250,000 on February 1, 2000 in
accordance with the terms of the agreement. Dr. Rothblatt is entitled to bonuses
for each year of the initial term of the agreement in the form of stock options,
in addition to other discretionary bonuses that may be awarded by the Board of
Directors. As amended in December 2000, the agreement provides that Dr.
Rothblatt will receive an option to purchase the number of shares of common
stock equal to .06 percent of the increase in the company's market
capitalization from its average in December each year (commencing December
2000). These options will be awarded pursuant to the Amended and Restated Equity
Incentive Plan and will be fully exercisable on the date of grant. The options
will have an exercise price equal to or exceeding the fair market value of a
share of United Therapeutics' common stock on the date of grant. The options are
exercisable over five years if Dr. Rothblatt is a 10% or greater stockholder on
the date of grant, or 10 years otherwise. The maximum number of shares reserved
for such grants is 7,939,517 and the maximum number that may be granted in any
one calendar year may not exceed 500,000 shares in 2000, 701,353 shares in 2001,
681,434 shares in 2002, 2,757,832 shares in 2003 and 3,298,898 shares in 2004.
If Dr. Rothblatt's employment is terminated due to her death or disability,
the company will continue to pay to Dr. Rothblatt or her estate her current base
salary through the end of the calendar year following such death or disability,
and if her employment is terminated for disability, United Therapeutics will pay
for continued benefits under its short-term and long-term disability insurance
programs. If Dr. Rothblatt's employment is terminated by United Therapeutics
other than for cause, or if Dr. Rothblatt terminates her employment for good
reason, as these terms are defined in the agreement, including circumstances
involving a change in control of United Therapeutics, she will be entitled to a
lump sum cash payment equal to the sum of:
- Her current base salary plus any bonus and incentive payments which have
been earned through the date of termination;
- The greater of her bonus and incentive payments for the prior year or the
average of such payments for the prior two years, on a prorated basis for
the year of termination;
- Three times the sum of her highest annual base salary for the preceding
12 months and the greater of her previous year's bonus and incentive
payment or the average of those payments for the previous two years; and
- The difference between the fair market price and the exercise price of
any non-vested options held by Dr. Rothblatt.
In addition, Dr. Rothblatt will receive certain employee and retirement
benefits. The agreement prohibits Dr. Rothblatt from engaging in activities
competitive with the company for five years following termination of her
employment.
8
United Therapeutics has entered into employment agreements with each of
Drs. Jeffs and Kanarek and Messrs. Balda and Blackburn. The term of Dr. Jeffs'
agreement ends in June 2006, and provides for an annual base salary of at least
$250,000. Dr. Jeff's agreement provides that if he is terminated as a result of
a change in control of the company, then he shall generally be entitled to a
lump sum payment for the base salary for his time remaining under the agreement
and any unvested options would immediately become vested. The term of Dr.
Kanarek's agreement ends on October 1, 2004 and provides for an annual base
salary of at least $210,000. The term of Mr. Blackburn's agreement ends on
August 1, 2003, and provides for an annual base salary of at least $100,000 but
was terminated early in January 2002. The term of the Balda's agreement ends on
January 2, 2006 and provides for an annual base salary of at least $200,000.
Each of the agreements with Drs. Jeffs and Kanarek and Mr. Balda also provides
for an automatic annual renewal unless either party terminates with notice,
ranging from 30 to 90 days, to the other party. In addition, each of the
agreements provides that if the employee is terminated by United Therapeutics
other than for cause, or if the employee terminates the agreement for good
reason, as those terms are defined in the agreements, the employee is entitled
to his base salary through the full term of the agreement. Furthermore, each of
these agreements prohibits Drs. Jeffs and Kanarek and Mr. Balda from accepting
employment, consultancy or other business relationships with a competitor of
United Therapeutics for twelve months following his last receipt of compensation
from United Therapeutics.
REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee of the Board of Directors is composed of
independent, non-employee directors. The current members of the Compensation
Committee are Mr. Miles and Dr. Gooray. The Committee has responsibility for
developing and implementing United Therapeutics' compensation policy for senior
management including the Chief Executive Officer. The goal of the Compensation
Committee is to achieve fair compensation for the individuals and to enhance
shareholder value by continuing to closely align the financial rewards of
management with those of United Therapeutics' shareholders. United Therapeutics'
stock incentive plans are also administered by the Compensation Committee.
CRITERIA FOR COMPENSATION LEVELS
United Therapeutics seeks to attract and retain qualified and experienced
executives and employees. The Committee attempts to create and administer a
compensation program to achieve that goal consistently among executives and
employees. In addition to base salary, compensation for United Therapeutics'
executive officers may include performance bonuses and stock option awards. It
is the intention of the Compensation Committee to use salary and cash bonuses as
compensation for current and past performance, while using stock options to
provide incentives for long-term performance.
In establishing the level of compensation for each executive officer, the
Compensation Committee considers many factors, including the executive officer's
performance, contribution to the advancement of corporate objectives, impact on
financial results, development of the management team, strategic
accomplishments, and the competitiveness and fairness of the compensation. The
amount of the base compensation, discretionary cash bonuses and long-term
incentive compensation for each executive officer is determined by the
Compensation Committee using the factors set forth above and, with respect to
executive officers other than the Chief Executive Officer, the recommendations
of the Chief Executive Officer.
Dr. Rothblatt and all other executive officers receive base salary and
salary increases in accordance with the terms of their employment agreements and
such additional compensation as determined by the Compensation Committee using
the factors set forth above.
In addition, in 2001, Dr. Rothblatt and each of the other executive
officers received a cash bonus in an amount equal to approximately 3% of his or
her base salary and a stock option award based upon the achievement of certain
performance goals by United Therapeutics in 2001.
9
COMPENSATION OF CEO
In 2001, Dr. Rothblatt received salary of $296,275 and bonuses consisting
of $12,641 in cash and 7,200 stock options.
Members of the Compensation Committee
Michael C. Miles (Chair)
David Gooray
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee for fiscal year 2001 were David
Gooray and Michael Miles. Neither of the Compensation Committee members has
served as an officer or employee of United Therapeutics or its subsidiaries.
REPORT OF THE AUDIT COMMITTEE
United Therapeutics' Audit Committee is comprised of three independent
directors. The Audit Committee operates under a written charter that was adopted
by United Therapeutics' Board of Directors.
The Audit Committee has met and held discussions with management and KPMG
LLP, the independent auditors. The Audit Committee has reviewed and discussed
United Therapeutics' 2001 consolidated financial statements with company
management and KPMG LLP. The Audit Committee has discussed with KPMG matters
that are required to be discussed by generally accepted auditing standards,
including those standards set forth in Statement on Auditing Standards No. 61.
KPMG LLP also provided to the Audit Committee the written disclosures
regarding its independence required by Independence Standards Board Standard No.
1. The Audit Committee has reviewed and discussed auditor independence with KPMG
LLP.
Based on these reviews and discussions, the Audit Committee recommended to
the Board of Directors that the audited consolidated financial statements for
2001 be included in United Therapeutics' Annual Report on Form 10-K for the year
ended December 31, 2001 filed with the Securities and Exchange Commission and
that KPMG LLP be reappointed as United Therapeutics' auditors for 2002.
Members of the Audit Committee
H. Beecher Hicks, III (Chair)
Michael C. Miles
David Gooray
10
STOCK PRICE PERFORMANCE
The graph below compares cumulative total stockholder return with the
cumulative returns (assuming reinvestment of dividends) of the Nasdaq US Stock
Market Index, the Nasdaq Pharmaceutical Stocks Index, the Standard & Poor's
Midcap 400 Index and the Standard & Poor's Biotechnology Index. United
Therapeutics is transitioning from a comparison to the Standard & Poor's Midcap
400 Index and the Standard & Poor's Biotechnology Index to the Nasdaq US Stock
Market Index and the Nasdaq Pharmaceutical Stocks Index as United Therapeutics
is a Nasdaq traded company and the majority of its peer biotechnology companies
are also Nasdaq traded companies. Hence, the Nasdaq indices are a more
representative comparison of United Therapeutics' total stockholder return. The
information on the graph covers the period from June 17, 1999 (the date United
Therapeutics' common stock began trading pursuant to the company's initial
public offering) through December 31, 2001. The stock price information shown on
the graph below is not necessarily indicative of future stock price performance.
COMPARISON OF THE 30 MONTH CUMULATIVE TOTAL RETURN*
AMONG UNITED THERAPEUTICS CORPORATION, THE NASDAQ US STOCK MARKET
INDEX, THE NASDAQ PHARMACEUTICAL STOCKS INDEX, STANDARD & POOR'S
MIDCAP 400 INDEX AND THE STANDARD & POOR'S BIOTECHNOLOGY INDEX
UNITED NASDAQ
THERAPEUTICS NASDAQ US STOCK PHARMACEUTICAL S&P
CORPORATION MARKET INDEX STOCKS INDEX S&P MIDCAP 400 BIOTECHNOLOGY
------------ --------------- -------------- -------------- -------------
6/17/99 $100.00 $100.00 $100.00 $100.00 $100.00
12/31/99 $377.42 $160.39 $176.53 $113.09 $189.92
12/31/00 $121.02 $ 96.47 $220.20 $132.89 $180.84
12/31/01 $ 85.41 $ 76.55 $187.66 $122.92 $174.10
------------------
* Assumes that $100.00 was invested on 6/17/99 in United Therapeutics' common
stock or in the indices (including reinvestment of dividends). United
Therapeutics fiscal year ends on December 31.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In April 2002, United Therapeutics agreed to loan $1.3 million to Dr. Roger
Jeffs to purchase his primary residence. The loan will be repaid at the end of
five years or earlier, in part or in full, if Dr. Jeffs obtains a mortgage on
the property, exercises and sells any United Therapeutics stock options, sells
any United Therapeutics stock, or sells the property. Interest of 6.5 percent
per year will accrue on the note. The loan is secured by the property and the
United Therapeutics stock that Dr. Jeffs owns. The Audit and Compensation
11
Committees of the Board of Directors, as well as the full Board of Directors,
approved this transaction without the participation of Dr. Jeffs.
In 2001, United Therapeutics entered into a marketing agreement with a
company owned by Raymond Kurzweil who was appointed as a Director of United
Therapeutics effective January 3, 2002. Pursuant to this agreement, United
Therapeutics will pay approximately $30,000 annually. United Therapeutics also
entered into an agreement in 2001 with Mr. Kurzweil to provide strategic
consulting services in the field of telemedicine. Pursuant to this agreement,
United Therapeutics will pay approximately $10,000 annually.
In 2000, United Therapeutics entered into a research agreement with
University of Oxford and an agreement for consulting services with Oxford
University Consulting with respect to the development of United Therapeutics'
iminosugar platform. United Therapeutics paid approximately $537,000 during the
year ended December 31, 2001 under these agreements. Under the research
agreement, United Therapeutics is required to pay the University of Oxford a
royalty equal to 1.5% percent of net sales of products arising from the
research, less certain offsets. Professor Raymond Dwek, who has been nominated
by United Therapeutics to serve as a Class III director for shareholder approval
at the 2002 annual meeting of stockholders, also serves as Chairman of the
Department of Biochemistry at the University of Oxford, CEO of Oxford University
Consulting, and is a co-discoverer of United Therapeutics' iminosugar drug
platform and a co-principal investigator under the research agreement with
University of Oxford.
Dr. Rothblatt, Chairman and Chief Executive Officer, Paul A. Mahon, Senior
Vice President, General Counsel and Corporate Secretary, and Andrew J. Fisher,
Vice President, Investor Relations & Deputy General Counsel, are principals of
the law firm Mahon Patusky Rothblatt & Fisher, Chartered, which United
Therapeutics has retained in the past. In June 2001, Messrs. Mahon and Fisher
joined United Therapeutics as full time employees and the arrangement with the
law firm for professional services was terminated. United Therapeutics paid the
law firm approximately $318,000 during the year ended December 31, 2001. Dr.
Rothblatt has not received any compensation from the law firm.
Unither Pharma, Inc., a subsidiary of United Therapeutics, entered into a
lease for office space with Beacon Projects in December 2001. Dr. Rothblatt is
the President and owner of Beacon Projects. The lease will expire in December
2003 and requires payments to Beacon Projects of $6,000 per month (increasing to
$6,600 per month for 2003). The Audit Committee of the Board of Directors
approved this transaction based on an independent appraisal without the
participation of Dr. Rothblatt. United Therapeutics believes that the terms of
these transactions were at least as favorable as terms it could have obtained in
arm's length transactions with an independent third party.
Unither Telemedicine Services Corporation, a subsidiary of United
Therapeutics, also entered into a lease for office space with Beacon Projects in
March 1999 that was terminated in June 2001. Payments under the lease totaled
approximately $44,000 for 2001. The Board of Directors approved this transaction
based on an independent appraisal without the participation of Dr. Rothblatt.
In 1998, United Therapeutics entered into a cooperative drug discovery
agreement with William Harvey Research Limited. United Therapeutics paid
approximately $205,000 during 2001 under this agreement. Under the agreement,
United Therapeutics is required to pay William Harvey a royalty equal to 10% of
net sales and license fees that the company earns from discoveries of William
Harvey. Dr. Rothblatt is president of William Harvey Medical Research
Foundation, an affiliate of William Harvey Research Limited.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires United
Therapeutics' directors and executive officers and persons who own beneficially
more than ten percent of any class of equity securities of the company to file
with the Securities and Exchange Commission initial reports of such ownership
and reports of changes in such ownership. Officers, directors and such
beneficial owners are required by Securities
12
and Exchange Commission regulation to furnish United Therapeutics with copies of
all Section 16(a) forms they file.
To United Therapeutics' knowledge, based solely on review of the copies of
such reports furnished to the company, during the fiscal year ended December 31,
2001, the company's directors, executive officers and greater than ten percent
beneficial owners complied with all Section 16(a) filing requirements applicable
to them, except that (i) Drs. Kanarek, Walley and Walsh and Messrs. Balda and
Kurzweil each filed a late Form 3; (ii) Dr. Gooray and Mr. Samara each filed a
late Form 5 with respect to four stock option grants exempt from Rule 16b-3 each
received as a director for in-person attendance at Board and Board Committee
meetings; (iii) Messrs. Hicks and Miles each filed a late Form 5 with respect to
seven stock option grants exempt under Rule 16b-3 each received as a director
for in-person attendance at Board and Board Committee meetings; (iv) Dr. Kanarek
filed a late Form 5 with respect to one stock option grant under Rule 16b-3 he
received; (v) Mr. Balda and Dr. Walsh each filed a late Form 5 with respect to
two stock option grants exempt under Rule 16b-3 each received; (vi) Drs. Jeffs
and Rothblatt and Mr. Hadeed each filed a late Form 5 with respect to three
stock option grants exempt under Rule 16b-3 each received; and (vii) Mr. Mahon
filed a late Form 5 with respect to seven stock option grants exempt under Rule
16b-3 he received.
INDEPENDENT AUDITORS
United Therapeutics is presently utilizing the services of KPMG LLP, which
has been the company's independent auditors since 1997 and will serve as the
company's independent auditors for the fiscal year ended December 31, 2002.
Representatives of KPMG LLP will be present at the annual meeting, will have the
opportunity to make a statement if they desire to do so, and will be available
to respond to appropriate questions.
INDEPENDENT AUDITORS' FEES
For fiscal 2001 services, United Therapeutics paid KPMG LLP the following
fees:
- Audit Fees: $115,000 for services rendered for the review of United
Therapeutics' quarterly financial statements and audit of United
Therapeutics' annual financial statements for fiscal 2001.
- Financial Information Systems Design and Implementation Fees: There were
no services rendered related to information systems.
- All Other Fees: $62,000 for the audit of a subsidiary and tax compliance
services.
United Therapeutics' Audit Committee has considered and determined that the
provision of non-audit services by KPMG LLP is compatible with maintaining KPMG
LLP's independence.
STOCKHOLDER PROPOSALS AND DIRECTOR NOMINATIONS
Stockholder proposals intended for inclusion in United Therapeutics' proxy
statement and form of proxy for the 2003 annual stockholders meeting must be
received by United Therapeutics no later than January 7, 2003. Upon receipt of
any stockholder's proposal, United Therapeutics will determine whether to
include the proposal in the proxy statement and form of proxy in accordance with
the regulations governing solicitation of proxies.
In order for a stockholder to nominate a director for election at the 2003
annual stockholders meeting, the company's Amended and Restated Bylaws require
that the stockholder give timely notice of the nomination to the company in
advance of the meeting. Such notice must be given not less than 90 days nor more
than 120 days prior to the anniversary date of the 2002 annual meeting of
stockholders.
In order for a stockholder to bring other business before the 2003 annual
stockholders meeting, timely notice must be given to United Therapeutics in
advance of the meeting. Such notice must be given no less than 90 nor more than
120 days prior to the anniversary date of the 2002 meeting, and must include a
13
description of the proposed business, the reason for conducting the proposed
business at the meeting and other matters as specified in United Therapeutics'
Amended and Restated Bylaws. These requirements are separate from and in
addition to the requirements a stockholder must meet to have a proposal included
in United Therapeutics' proxy statement. These time limits also apply in
determining whether notice is timely for purposes of rules adopted by the
Securities and Exchange Commission relating to the exercise of discretionary
voting authority by proxies designated by the company.
All notices of proposals must be given to United Therapeutics' Corporate
Secretary, Paul A. Mahon, Esq., whose address is United Therapeutics
Corporation, 1110 Spring Street, Silver Spring, Maryland 20910.
The company will furnish a copy of United Therapeutics' Amended and
Restated Certificate of Incorporation or Amended and Restated Bylaws to any
stockholder without charge upon written request to the Corporate Secretary by
the stockholder.
OTHER MATTERS
The Board of Directors knows of no other matters to be presented for
consideration at the annual meeting. If any other matter properly comes before
the meeting, the persons named in the accompanying proxy intend to vote on such
matters in accordance with their judgment.
May 6, 2002
14
UNITED THERAPEUTICS CORPORATION
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 26, 2002
The undersigned hereby names, constitutes and appoints Martine A.
Rothblatt and Paul A. Mahon, and each of them, with full powers of
substitution to act as true and lawful attorneys and proxies for the
undersigned, and in the place and stead of the undersigned to attend the
Annual Meeting of the Stockholders of United Therapeutics Corporation to be
held on Wednesday, June 26, 2002 at 9:00 a.m. Eastern Time, and at any
adjournment thereof, and to vote all the shares of Common Stock held of record
in the name of the undersigned on April 29, 2002, with all the powers that the
undersigned would possess if he or she were personally present.
PLEASE DATE, SIGN AND MAIL THIS PROXY PROMPTLY
IN THE ENCLOSED REPLY ENVELOPE
(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)
1. Election of Directors FOR WITHHOLD Nominees: 2. The transaction of such other
(Instructions: To all nominees AUTHORITY business as may properly come
withhold authority to listed, except as to vote for all Class III Raymond Dwek, F.R.S. before the meeting and any and
vote for any individual marked to the nominees listed Roger Jeffs, Ph.D. all adjournments thereof.
nominees, strike a line contrary
through the nominee's
name.)
[ ] [ ] THE BOARD OF DIRECTORS
UNANIMOUSLY RECOMMENDS
A VOTE FOR EACH OF THE
NOMINEES NAMED ABOVE.
IF NO SPECIFIC DIRECTION IS
GIVEN AS TO EITHER OF THE ABOVE
Should the undersigned be present and elect to vote at the Annual Meeting or at any adjournment ITEMS, THIS PROXY WILL BE VOTED
thereof and after notification to United Therapeutics at the Annual Meeting of the stockholder's FOR EACH OF THE NOMINEES NAMED
decision to terminate this proxy, then the power of said attorneys and proxies shall be deemed IN PROPOSAL 1. IF ANY OTHER
terminated and of no further force and effect. BUSINESS IS PRESENTED AT SUCH
MEETING, THIS PROXY WILL BE
VOTED BY THE BOARD OF DIRECTORS
IN ITS JUDGEMENT. AT PRESENT
TIME, THE BOARD OF DIRECTORS
KNOWS OF NO OTHER BUSINESS
TO BE PRESENTED AT THE
ANNUAL MEETING. THIS PROXY ALSO
CONFERS DISCRETIONARY AUTHORITY
ON THE BOARD OF DIRECTORS TO
VOTE WITH RESPECT TO THE
ELECTION OF ANY PERSON AS
DIRECTOR WHERE THE NOMINEES ARE
UNABLE TO SERVE OR FOR GOOD
CAUSE WILL NOT SERVE AND
MATTERS INCIDENT TO THE CONDUCT
OF THE ANNUAL MEETING.
The undersigned acknowledges receipt from United Therapeutics prior to the execution of this
proxy of the Notice of Annual Meeting of Stockholders, a Proxy Statement and the 2001 Annual
Report to Shareholders.
DATED____________ SHAREHOLDER (print name)______________________________ I do [ ] do not [ ] plan to attend
SHAREHOLDER (sign name) ______________________________ the meeting. (Please check one.)
NOTE: Please sign exactly as your name appears on this proxy card. When signing as attorney, executor, administrator, trustee or
guardian, please give your full title. If shares are held jointly, each holder should sign.
THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF UNITED
THERAPEUTICS CORPORATION. IF NO SPECIFIC DIRECTION IS GIVEN AS TO EITHER OF
THE ABOVE ITEMS, THIS PROXY WILL BE VOTED FOR EACH OF THE NOMINEES NAMED IN
PROPOSAL 1. IF ANY OTHER BUSINESS IS PRESENTED AT SUCH MEETING, THIS PROXY
WILL BE VOTED BY THE ABOVE-NAMED PROXIES IN THEIR BEST JUDGEMENT. AT THE
PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE
PRESENTED AT THE ANNUAL MEETING.
Should the undersigned be present and elect to vote at the Annual
Meeting or at any adjournment and after notification to United Therapeutics at
the Annual Meeting of the stockholder's decision to terminate this proxy, then
the power of said proxies shall be deemed terminated and of no further force and
effect.
The undersigned acknowledges receipt from United Therapeutics prior to
the execution of this proxy of the Notice of Annual Meeting of Stockholders, a
Proxy Statement and the 2001 Annual Report to Shareholders.