SCHEDULE 14A INFORMATION
CONSENT STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-12
EXEGENICS INC.
(Name of Registrant as Specified in its Charter)
FOUNDATION GROWTH INVESTMENTS LLC
EI ACQUISITION INC.
(Name of Person(s) Filing Consent 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)(l) and 0-11.
(1) Title of each class of securities to which Offer and a subsequent merger
applies:
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(2) Aggregate number of securities to which Offer and a subsequent merger
applies:
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(3) Per unit price or other underlying value of Offer and a subsequent
merger 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 Offer and a subsequent merger:
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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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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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PRELIMINARY COPY -- SUBJECT TO COMPLETION
A DEFINITIVE CONSENT STATEMENT WILL BE FILED FOLLOWING SEC REVIEW.
FOUNDATION GROWTH INVESTMENTS LLC
EI ACQUISITION INC.
225 WEST WASHINGTON STREET, SUITE 2320
CHICAGO, ILLINOIS 60606
To the Stockholders of eXegenics Inc.:
As you may be aware, on May 29, 2003, we made an all-cash offer of
$0.40 for all outstanding shares of common stock and Series A Convertible
Preferred Stock of eXegenics Inc. The purpose of our tender offer is for
Foundation Growth Investments LLC, through its subsidiary EI Acquisition Inc.,
to acquire for cash as many shares as necessary for it to gain effective control
of eXegenics and facilitate a merger of eXegenics with EI Acquisition.
eXegenics' current board of directors has recommended that you do not
tender into our $0.40 per share all-cash tender offer. Moreover, eXegenics'
board of directors implemented a number of defensive legal measures that may
have the effect of preventing our all-cash tender offer from being consummated,
including a poison pill instrument.
While we recognize that companies often adopt anti-takeover measures in
a manner aligned with interests of their security holders and that commentators
and corporate governance experts disagree on the propriety and utility of poison
pills, the circumstances surrounding eXegenics' opportune adoption of the
measures described above do not support a similar conclusion. To the best of our
knowledge, no plans were in existence prior to the announcement of our tender
offer for the adoption of these measures, yet their adoption and implementation
occurred within days following our tender offer.
Accordingly, we are today commencing a solicitation of all of
eXegenics' stockholders to consent to:
o the removal of all the members of the Company's board of
directors; and
o the election of three new directors to serve as members of the
Company's board of directors (the "Nominees").
We are soliciting your consent to these actions because we believe, as
a result of the existing management's history, the timing of the adoption of
various anti-takeover measures, and the certainty of our offer relative to the
continued depletion of the Company's assets and the impending delisting of the
Company's common stock from The Nasdaq Stock Market, that the current directors
of eXegenics are not acting, and are unwilling to act, in the best interests of
eXegenics' stockholders. We believe that, unlike the current directors, if
elected, the Nominees will consider, consistent with the fulfillment of their
fiduciary duties under Delaware law, whether to take such actions as they may
deem necessary or appropriate to expedite the prompt consummation of our offer
and a subsequent merger, including:
o exempting us from the application of the poison pill by redeeming
the rights or amending or terminating the poison pill instruments
to make the rights inapplicable to our offer and a subsequent
merger;
o exempting us from the application of the Delaware anti-takeover
statute by approving our offer and a subsequent merger before we
become "interested stockholders" under this statute;
o repealing all amendments to the eXegenics bylaws since the
version identified in eXegenics' Form 10-K for the year ended
December 31, 2002; and
o approving the merger with Foundation Growth Investments'
wholly-owned subsidiary, EI Acquisition Inc., following the
successful completion of the tender offer;
or, if a proposal has been made respecting a transaction that is determined to
be superior to our offer and a subsequent merger for the Company's stockholders,
whether to take such actions as they may deem necessary or appropriate to
facilitate that transaction. However, we cannot provide any assurances that the
Nominees, if elected,
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would be able to execute our proposal and effect a subsequent merger. The
accompanying consent statement describes the specific features of our proposal,
as well as the consent procedure itself. IF THESE MEASURES DO NOT PASS, WE MAY
ABANDON OUR CASH TENDER OFFER, AND YOU WILL NO LONGER BE ABLE TO SELL YOUR
SHARES TO US IN THE OFFER.
The results of our request for consent will be communicated to you by
the issuance of a press release. Additionally, in accordance with applicable
law, prompt notice of the results will be provided to stockholders who have not
executed consents.
Please consent with respect to all shares for which you were entitled
to give consent as of the ______ ___, 2003 record date, as set forth on your
WHITE consent card, in favor of the Nominees and the bylaw amendment, as
described in the accompanying consent statement.
Very truly yours,
Timothy Leonard
President, EI Acquisition Inc.
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IMPORTANT
1. If you hold your shares in your own name, please sign, date and mail
the enclosed WHITE consent card to Morrow & Co. in the postage-paid envelope
provided.
2. If your shares are held in the name of a brokerage firm, bank
nominee or other institution, only it can execute a consent representing your
shares and only on receipt of your specific instructions. Accordingly, you
should contact the person responsible for your account and give instructions for
a WHITE consent card to be signed representing your shares. We urge you to
confirm in writing your instructions to the person responsible for your account
and provide a copy of those instructions to Foundation Growth Investments LLC in
care of Morrow & Co. so that we will be aware of all instructions given and can
attempt to ensure that those instructions are followed.
If you have any questions or require any assistance in executing your
consent, please call:
MORROW & CO., INC.
445 Park Avenue
New York, New York 10002
Banks and Brokers, call: (800) 654-2468
STOCKHOLDERS, CALL: (800) 607-0088
All others, call collect: (212) 754-8000
The Dealer Manager and Financial Adviser to
Foundation Growth Investments LLC is:
WILLIAM BLAIR & COMPANY
222 West Adams Street
Chicago, Illinois 60606
(312) 236-1600
(800) 621-0687 ext. 5333
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PRELIMINARY COPY -- SUBJECT TO COMPLETION
JUNE 18, 2003
A DEFINITIVE CONSENT STATEMENT WILL BE FILED FOLLOWING SEC REVIEW.
CONSENT STATEMENT
OF
EI ACQUISITION INC.
AND
FOUNDATION GROWTH INVESTMENTS LLC
EI Acquisition Inc., a Delaware corporation ("EI Acquisition," "we" or
"our") and a wholly-owned subsidiary of Foundation Growth Investments LLC, a
Delaware limited liability company ("Foundation Growth"), together with
Foundation Growth are furnishing this consent statement in connection with their
solicitation of written consents from the holders of common stock, par value
$.01 per share, and Series A Convertible Preferred Stock, par value $0.01 per
share (collectively, the "Shares"), of eXegenics Inc., a Delaware corporation
(the "Company"), to take the following actions without a stockholders' meeting
in accordance with Delaware law:
o remove all of the members of the board of directors of the
Company; and
o elect Timothy Leonard, Terry Robbins, and Michael Pechette (the
"Nominees") to serve as all the members of the board of directors
of the Company.
If elected, we expect the Nominees who would comprise the entire board,
to consider, consistent with the fulfillment of their fiduciary duties under
Delaware law, whether to take actions to facilitate:
o exempting us from the application of the Stockholder Rights
Agreement dated June 9, 2003, as amended, as adopted by the board
(the "Rights Agreement"), by redeeming the rights or amending or
terminating the Rights Agreement instruments to make the rights
inapplicable to our offer and a subsequent merger;
o exempting us from the application of Section 203 of the Delaware
General Corporation Law ("DGCL"), the Delaware anti-takeover
statute, by approving our offer and a subsequent merger before we
become "interested stockholders" under Section 203 of the DGCL;
o repealing all amendments to the eXegenics bylaws since the
version identified in eXegenics' Form 10-K for the year ended
December 31, 2002; and
o approving the merger with Foundation Growth's wholly-owned
subsidiary, EI Acquisition, following the successful completion
of the tender offer.
THIS SOLICITATION IS BEING MADE BY EI ACQUISITION AND FOUNDATION GROWTH
AND NOT ON BEHALF OF THE COMPANY.
We are proposing these actions (each a "Proposal") to expedite the
prompt consummation of our tender offer to acquire the Company, which we
describe below. WE ARE ASKING THE STOCKHOLDERS OF THE COMPANY TO EXPRESS THEIR
CONSENT TO THE PROPOSALS ON THE ACCOMPANYING WHITE CONSENT CARD.
The effectiveness of each Proposal will require the properly completed
and duly delivered, unrevoked written consent to that Proposal by the holders of
record, as of the close of business on ______ ___, 2003, the record date for
this consent solicitation, of a majority of the Shares then outstanding. See
"Consent Procedure."
This consent statement and the related WHITE consent card are first
being sent or given on or about _______ ___, 2003 to all holders of record of
Shares on the record date for this consent solicitation. On that date, we owned
1,000 shares of common stock, or less than one percent of the outstanding
Shares.
By virtue of the recent amendments to the Company's bylaws made by the
current directors, the Company's bylaws provide that any stockholder of record
seeking to have the stockholders authorize or take corporate action by written
consent without a meeting must request the Company's board to fix a record date
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in order to determine the stockholders entitled to give that consent. The
Company's board must promptly, but in all events within 10 business days after
the date on which the request is received, adopt a resolution fixing that record
date, which record date must be no more than 10 days after the date of the
resolution. If the board does not fix a record date within that period, the
record date for the solicitation will be the date on which the first signed
consent is delivered to the Company. Foundation Growth is the record owner of
1,000 shares of common stock of the Company, and as such is requesting the board
to fix a record date for this consent solicitation. If the board does not timely
fix a record date for this consent solicitation, the record date will be the
date on which the first signed consent is delivered to the Company.
On May 29, 2003, we commenced an offer to purchase all outstanding
Shares, at a price of $0.40 per Share, in cash and without interest, on the
terms and subject to the conditions set forth in our Offer to Purchase dated May
29, 2003, as amended, and in the related Letter of Transmittal (which, together
with any amendments or supplements thereto, collectively constitute the
"Offer").
Complete information about our Offer is contained in our Offer to
Purchase, which is available on request from Morrow & Co., the information agent
for the Offer, at 445 Park Avenue, New York, New York 10002, at no charge, and
in our tender offer statement on Schedule TO, which is on file with the
Securities and Exchange Commission. That tender offer statement and any
amendments thereto, including exhibits, are available for inspection and copies
thereof may be obtained in the manner set forth under "Certain Information
Concerning EI Acquisition and Foundation Growth Investments" in our Offer to
Purchase.
THIS CONSENT STATEMENT IS NEITHER A REQUEST FOR THE TENDER OF SHARES
NOR AN OFFER WITH RESPECT THERETO. WE ARE MAKING THE OFFER ONLY BY MEANS OF THE
OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL.
The purpose of our Offer is for Foundation Growth, through EI
Acquisition, to acquire for cash as many Shares as necessary for it to gain
effective control of the Company and facilitate a merger of the Company with EI
Acquisition.
We currently intend, as soon as practicable after the Nominees have
become members of the Company's board, to request that the board duly consider
and take the actions we describe below subject to their fiduciary duties under
Delaware law. If the board takes these actions and the other conditions to the
Offer are satisfied or waived by us, we currently intend to effect, as soon as
practicable after we consummate the Offer, a merger of the Company with and into
EI Acquisition (the "Merger"), as a result of which:
o each share of Series A Convertible Preferred Stock, par value
$0.01 per share ("Series A Preferred Stock"), not tendered in the
Offer that is issued and outstanding immediately prior to the
date of the Merger will convert into one share of preferred stock
of the surviving company. The terms and conditions of this new
preferred stock will be substantially similar to the Series A
Preferred Stock, except the new preferred stock will have (1) a
liquidation preference of $0.01 per share of new preferred stock
over the common stock, and (2) the right to convert each new
share of preferred stock only into its pro rata amount of 6.0% of
the fully-diluted new common stock of the surviving entity
(assuming that for purposes of determining "pro rata amount,"
910,822 shares of Series A Preferred Stock into 910,822 shares of
new preferred stock). To the extent the Merger may affect the
rights, preferences and privileges of the Series A Preferred
Stock, those consequences would be the product of the Merger;
o each share of eXegenics common stock issued and outstanding
immediately prior to the effective date of the Merger (other than
shares of eXegenics common stock held by public stockholders, if
any, who are entitled to and who properly exercise their
dissenters' rights under the DGCL) will be cancelled and
extinguished and be converted into and become a right to receive
$0.40 per share (the "Offer Price"); and
o the holders of outstanding shares of EI Acquisition's capital
stock issued and outstanding immediately prior to the effective
date of the Merger shall receive for each share of EI Acquisition
held, one validly issued, fully paid and nonassessable share of
common stock of the surviving company.
There can be no assurance, however, that, the Nominees, if elected,
would be able to execute our proposal and effect a merger or similar business
combination.
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We have conditioned the Offer on, among other things, there being
validly tendered and not properly withdrawn prior to the expiration of the Offer
a number of Shares that represent at least a majority of all outstanding Shares
on the date of purchase.
Stockholder Rights Agreement. On June 9, 2003, the Board of Directors
of the Company adopted a Stockholder Rights Agreement (the "Rights Agreement")
and authorized and declared a dividend of one purchase right (a "Right") for
each outstanding share of common stock. Except as set forth below, each Right
entitles the registered holder to purchase from the Company, at any time after
the applicable distribution date, one one-thousandth of a share of Series B
Junior Participating Preferred Stock at an exercise price of $4.50, subject to
adjustment. If a person or group acquires beneficial ownership of 15% or more of
eXegenics' common stock, each right will entitle its holder (other than the
acquiring person or members of the acquiring group) to purchase, at the Right's
then current exercise price (initially $4.50), a number of eXegenics' shares of
common stock having a market value of twice such price (initially $9.00).
Additionally, in the event that, after the applicable distribution
date, the Company is acquired in a merger or similar transaction, the holder of
the Rights will have the right to receive, upon payment of the exercise price,
shares of the acquiring company's stock having a value equal to twice the
exercise price.
Section 203 of the Delaware General Corporation Law. In general,
Section 203 of the DGCL is an anti-takeover statute that prevents an "interested
stockholder" (defined generally as a person owning 15% or more of a
corporation's outstanding voting stock) of a Delaware corporation from engaging
in a "business combination" (defined to include, as a general matter, the merger
of the corporation with an "interested stockholder") with such corporation for
three years following the date such person became an interested stockholder
unless: (i) before such person became an "interested stockholder," the board of
directors of the corporation approved either the "business combination" or the
transaction that resulted in the stockholder becoming an "interested
stockholder"; (ii) upon consummation of the transaction that resulted in the
stockholder becoming an "interested stockholder," the "interested stockholder"
owned at least 85% of the outstanding voting stock of the corporation
outstanding at the time the transaction commenced, excluding shares owned by
directors and officers and shares owned by employee stock-plans in which
employee participants do not have the right to determine confidentially whether
shares held subject to the plan will be tendered in an exchange or tender offer;
or (iii) at or subsequent to the time the stockholder becomes an "interested
stockholder," the "business combination" is approved by the board and authorized
at a meeting of stockholders by the affirmative vote of the holders of at least
two-thirds of the outstanding voting stock of the corporation not owned by the
"interested stockholder."
Purpose of the Consent. The principal reason we are seeking to elect
the Nominees to the Company's board is the willingness of the Nominees to
consider, consistent with the fulfillment of their fiduciary duties under
Delaware law, whether to take such actions as they may deem necessary or
appropriate to expedite the prompt consummation of our Offer and a subsequent
merger, including:
o exempting us from the application of the Rights Agreement by
redeeming the Rights or amending the Rights Agreement to make the
Rights Agreement inapplicable to our Offer and a subsequent
merger; and
o exempting us from the application of Section 203 of the DGCL by
approving our Offer and a subsequent merger before we become
"interested stockholders" under Section 203 of the DGCL;
or, if a proposal has been made respecting a transaction for the Company's
stockholders that is determined to be superior to our Offer and a subsequent
merger, whether to take such actions as they may deem necessary or appropriate
to facilitate that transaction. However, we cannot provide any assurances that
the Nominees, if elected, would be able to execute our proposal and effect a
subsequent merger or similar business combination.
ADOPTION OF THE PROPOSALS IS AN IMPORTANT STEP TOWARD PROMPT
CONSUMMATION OF OUR OFFER AND A SUBSEQUENT MERGER. ACCORDINGLY, WE URGE YOU TO
PROMPTLY SIGN, DATE AND MAIL THE ENCLOSED WHITE CONSENT CARD. YOU MUST
SEPARATELY TENDER YOUR SHARES PURSUANT TO THE OFFER IF YOU WISH TO PARTICIPATE
IN THE OFFER. EXECUTING A CONSENT DOES NOT OBLIGATE YOU TO TENDER YOUR SHARES
PURSUANT TO THE OFFER, AND YOUR FAILURE TO EXECUTE A CONSENT DOES NOT PREVENT
YOU FROM TENDERING YOUR SHARES PURSUANT TO THE OFFER. NEVERTHELESS, IN AN EFFORT
TO BE IN A POSITION TO CONSUMMATE THE OFFER AS SOON AS POSSIBLE, WE REQUEST THAT
YOU PROMPTLY TENDER YOUR SHARES PURSUANT TO THE OFFER.
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Because each Proposal will become effective only if executed consents
to that Proposal are returned by holders of record on the record date for this
consent solicitation of a majority of the total number of Shares then
outstanding, the failure to execute and return a consent will have the same
effect as voting against the Proposals.
We have retained Morrow & Co. to assist in the solicitation of consents
to the Proposals.
If your Shares are registered in your own name, please sign, date and
mail the enclosed WHITE consent card to Morrow & Co. in the post-paid envelope
provided. If your Shares are held in the name of a brokerage firm, bank nominee
or other institution, only it can sign a WHITE consent card with respect to your
Shares and only on receipt of specific instructions from you. Accordingly, you
should contact the person responsible for your account and give instructions for
a WHITE consent card to be signed representing your Shares. We urge you to
confirm in writing your instructions to the person responsible for your account
and to provide a copy of those instructions to Foundation Growth Investments LLC
in care of Morrow & Co., 445 Park Avenue, New York, New York 10002, so we will
be aware of all instructions given and can attempt to ensure that those
instructions are followed.
If you have any questions or require any assistance in executing your
consent, please call:
MORROW & CO., INC.
445 Park Avenue
New York, New York 10002
Banks and Brokers, call: (800) 654-2468
STOCKHOLDERS, CALL: (800) 607-0088
All others, call collect: (212) 754-8000
The Dealer Manager and Financial Adviser to
Foundation Growth Investments LLC is:
WILLIAM BLAIR & COMPANY
222 West Adams Street
Chicago, Illinois 60606
(312) 236-1600
(800) 621-0687 ext. 5333
4
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SUMMARY
The information in this summary is qualified in its entirety by
reference to the more detailed information appearing elsewhere in this consent
statement or in the Offer to Purchase, as applicable.
Q: WHAT ARE THE PROPOSALS FOR WHICH WRITTEN CONSENTS ARE BEING
SOLICITED?
A: We are soliciting your consent in order to:
o remove all of the members of the board of directors of the
Company; and
o elect Timothy Leonard, Terry Robbins, and Michael Pechette (the
"Nominees") to serve as all the members of the board of directors
of the Company.
If elected, we expect the Nominees who would comprise the entire board,
to consider, consistent with the fulfillment of their fiduciary duties under
Delaware law, whether to take actions to facilitate:
o exempting us from the application of the Stockholder Rights
Agreement dated June 9, 2003, and as adopted by the board (the
"Rights Agreement"), by redeeming the rights or amending or
terminating the Rights Agreement instruments to make the rights
inapplicable to our offer and a subsequent merger;
o exempting us from the application of Section 203 of the Delaware
General Corporation Law ("DGCL"), the Delaware anti-takeover
statute, by approving our offer and a subsequent merger before we
become "interested stockholders" under Section 203 of the DGCL;
o repealing all amendments to the eXegenics bylaws since the
version identified in eXegenics' Form 10-K for the year ended
December 31, 2002; and
o approving the merger with Foundation Growth's wholly-owned
subsidiary, EI Acquisition, following the successful completion
of the tender offer;
or, if a proposal has been made respecting a transaction that is determined to
be superior to our Offer and a subsequent merger for the Company's stockholders,
whether to take such actions as they may deem necessary or appropriate to
facilitate that transaction. However, we cannot provide any assurances that the
Nominees, if elected, would be able to execute our proposal and effect a
subsequent merger.
Q: WHAT IS THE NATURE OF THE OFFER AND SUBSEQUENT MERGER?
A: On May 29, 2003, we commenced our Offer, which provides for our
purchase of all outstanding Shares at a price of $0.40 per Share in cash. The
purpose of our Offer is for Foundation Growth to acquire for cash as many Shares
as necessary for it to gain effective control of the Company and facilitate a
merger of the Company with EI Acquisition. We currently intend, as soon as
practicable after the Nominees are elected to the Company's board, to request
that the board duly consider and then take the actions respecting our Offer and
a subsequent merger, which we describe below in "The Proposals." If the board is
able to take these actions and the other conditions to the Offer have been
satisfied or waived by us, Foundation Growth currently intends to effect a
subsequent merger as soon as practicable after we consummate the Offer.
We currently intend, as soon as practicable after the Nominees have
become members of the Company's board, to request that the board duly consider
and take the actions we describe below subject to their fiduciary duties under
Delaware law. If the board takes these actions and the other conditions to the
Offer are satisfied or waived by us, we currently intend to effect, as soon as
practicable after we consummate the Offer, a merger of the Company with and into
EI Acquisition (the "Merger"), as a result of which:
o each share of Series A Convertible Preferred Stock, par value
$0.01 per share ("Series A Preferred Stock"), not tendered in the
Offer that is issued and outstanding immediately prior to the
date of the Merger will convert into one share of preferred stock
of the surviving company. The terms and conditions of this new
preferred stock will be substantially similar to the Series A
Preferred Stock, except the new preferred stock will have (1) a
liquidation preference of $0.01 per share of new preferred stock
5
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over the common stock, and (2) the right to convert each new
share of preferred stock only into its pro rata amount of 6.0% of
the fully-diluted new common stock of the surviving entity
(assuming that for purposes of determining "pro rata amount",
910,822 shares of Series A Preferred Stock into 910,822 shares of
new preferred stock). To the extent the Merger may affect the
rights, preferences and privileges of the Series A Preferred
Stock, those consequences would be the product of the Merger;
o each share of eXegenics common stock issued and outstanding
immediately prior to the effective date of the Merger (other than
shares of eXegenics common stock held by public stockholders, if
any, who are entitled to and who properly exercise their
dissenters' rights under the Delaware General Corporation Law
("DGCL")) will be cancelled and extinguished and be converted
into and become a right to receive $0.40 per share (the "Offer
Price"); and
o the holders of outstanding shares of EI Acquisition's capital
stock issued and outstanding immediately prior to the effective
date of the Merger shall receive for each share of EI Acquisition
held, one validly issued, fully paid and nonassessable share of
common stock of the surviving company.
For additional information respecting the proposed merger, see "The Offer".
Although the adoption of our Proposals is an important step toward
prompt consummation of our Offer and a subsequent merger, we are not asking the
Company's stockholders to tender their Shares by means of this consent
solicitation or to consent to or vote on the proposed merger at this time.
Q; WHAT VOTING SECURITIES DOES THE COMPANY HAVE AND WHO ARE THE
PRINCIPAL HOLDERS?
A: The common stock, par value $0.01 per share, and the Series A
Convertible Preferred Stock, par value $0.01 per share, of the Company
constitute the voting securities of the Company and the Series A Convertible
Preferred Stock is convertible share-for-share into the common stock. Only
holders of common stock and Series A Convertible Preferred Stock are entitled to
execute consents. For information regarding the person we believe beneficially
owns more than five percent of the common stock, see "Voting Securities and
Principal Holder."
Q: WHAT IS THE PROCEDURE FOR THE SOLICITATION OF CONSENTS?
A: We will pay all costs of our solicitation of consents. The consents
are being solicited in accordance with the applicable provisions of the DGCL.
Holders of record of the Shares as of the close of business on the record date
for this consent solicitation are entitled to consent to our Proposals. To be
effective, the requisite consents must be delivered to the Company within 60
days of the earliest dated consent delivered to the Company. See "Consent
Procedure."
Q: WHAT ARE THE REASONS FOR THE SOLICITATION?
A: We are soliciting your consent to these actions because we believe,
as a result of the existing management's history, the timing of the adoption of
various anti-takeover measures, and the certainty of our offer relative to the
continued depletion of the Company's assets and the impending delisting of the
Company's common stock from The Nasdaq Stock Market, that the current directors
of eXegenics are not acting, and are unwilling to act, in the best interests of
eXegenics' stockholders. eXegenics' current board of directors has recommended
that you do not tender into our $0.40 per share all-cash tender offer and have
implemented a number of defensive legal measures that may have the effect of
preventing our all-cash tender offer from being consummated, including a poison
pill instrument.
The adoption of our Proposals will require the affirmative written
consent of the holders of a majority of the outstanding Shares. Abstentions and
non-votes will be counted as a vote against the Proposals. See "The Proposals."
IF WE DO NOT RECEIVE SUFFICIENT WRITTEN CONSENTS TO APPROVE OUR PROPOSALS, WE
MAY WITHDRAW OUR CASH TENDER OFFER.
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THE PROPOSALS
We are seeking written stockholder consents without a meeting to the
Proposals, which consist of: (i) the removal of all the members of Company's
board of directors (Proposal No. 1); and (ii) the election of the Nominees to
the Company's board of directors (Proposal No. 2).
The effectiveness of each Proposal will require the duly completed and
delivered, unrevoked written consent to that Proposal by the holders of record,
as of the close of business on the record date for this consent solicitation, of
a majority of the Shares then outstanding.
WE URGE YOU TO CONSENT TO EACH PROPOSAL.
DIRECTOR REMOVAL (PROPOSAL NO. 1)
This Proposal involves the immediate removal from office of all the
existing members from the Company's board of directors.
WE URGE YOU TO CONSENT TO THE ADOPTION OF THE DIRECTOR REMOVAL
(PROPOSAL NO. 1).
ELECTION OF NOMINEES (PROPOSAL NO. 2)
This Proposal includes the election to the Company's board of directors
of the three Nominees named below, each of whom has consented to being named as
a Nominee and to serve as a director, if elected. If elected, the Nominees will
serve until the next annual meeting of the Company's stockholders for which
directors of that class of director is up for election, and until his or her
successor shall have been duly elected and qualified or until his or her earlier
death, resignation or removal. Our principal purpose in seeking to elect the
Nominees to the Company's board is to have the board consider: (i) exempting us
from the application of the Rights Agreement, by redeeming the rights or
amending or terminating the Rights Agreement instruments to make the rights
inapplicable to our offer and a subsequent merger; (ii) exempting us from the
application of Section 203 of the DGCL by approving the Offer and a subsequent
merger before we become "interested stockholders" under Section 203 of the DGCL;
(iii) approving the merger of the Company with Foundation Growth's wholly-owned
subsidiary, EI Acquisition, following the successful completion of the Offer;
and (iv) if desirable, repealing all amendments to the eXegenics bylaws since
the version identified in eXegenics' Form 10-K for the year ended December 31,
2002.
If elected, the Nominees will be responsible for managing the business
and affairs of the Company. Each director of the Company has an obligation under
Delaware law to discharge his duties as a director on an informed basis, in good
faith and in a manner the director honestly believes to be in the best interests
of the Company. In this connection, circumstances may arise in which our
interests and those of Foundation Growth differ from the interests of other
stockholders of the Company. In any such case, we understand that the Nominees
intend to discharge fully the fiduciary obligations they would then owe to the
Company and its stockholders under Delaware law. Accordingly, we cannot provide
any assurances that the Nominees, if elected, will be able to execute our
proposal and effect a subsequent merger or similar business combination.
We have no reason to believe that any Nominee will be unable or
unwilling to serve as a director of the Company, but if any Nominee is not
available for election, the Nominees who are elected will fill the resulting
vacancy.
Set forth below is the name, present principal occupation or employment
and material occupations, positions, offices or employment for the past five
years of each Nominee. The current business address for each Nominee is c/o EI
Acquisition Inc., 225 West Washington Street, Suite 2320, Chicago, Illinois
60606; Telephone: (312) 551-9900. Except for 1,000 shares of common stock owned
of record by Foundation Growth Investments LLC, none of the Nominees is the
beneficial or record owner, directly or indirectly, of any shares of capital
stock of eXegenics.
NAME AGE POSITION
---- --- --------
Timothy Leonard........ 44 Director, President of EI Acquisition Inc. and
managing member of Foundation Growth
Investments LLC
Terry Robbins.......... 42 Director, Treasurer of EI Acquisition Inc. and
managing member of Foundation Growth
Investments LLC
7
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Michael Pechette....... 47 Director, Secretary of EI Acquisition Inc. and
managing member of Foundation Growth
Investments LLC
TIMOTHY LEONARD
Mr. Timothy Leonard serves as a Director and as President of EI
Acquisition Inc. and as Founding Member of Foundation Growth Management LLC, the
managing member of Foundation Growth Investments LLC, a private investment fund.
From May, 1997 through January, 2000, Mr. Leonard served as Vice President,
Treasurer and Chief Financial Officer of DBT Online, Inc., a NYSE company
engaged in the aggregation of public record data utilized primarily by the
government, investigative and pre-employment markets. DBT Online, Inc. was sold
to Choicepoint, Inc. in January, 1997. From January, 2000 through March, 2003,
Mr. Leonard served as Executive Vice President and Chief Financial Officer of
Total eData Corporation, a privately-held company engaged in the aggregation of
online and offline data for marketing purposes. Total eData was acquired in
April, 2002 by Choicepoint, Inc. He began his career with Ernst & Young
(formerly Ernst & Whinney) where he specialized in large multi-national
manufacturing, distribution and retail publicly traded companies who were
actively involved in mergers and acquisitions. Mr. Leonard received his B.S.
degree in Accounting from the University of Delaware. He is a member of the
Pennsylvania and American Institute of Certified Public Accountants. Mr. Leonard
is a citizen of the United States.
TERRY ROBBINS
Mr. Terry Robbins serves as a Director and as Treasurer of EI
Acquisition and as Founding Member of Foundation Growth Management LLC, the
managing member of Foundation Growth Investments LLC, a private investment fund.
Mr. Robbins founded and has been Managing Partner of Robbins & Associates LLC,
an accounting and consulting firm, since 1990. He also has served on the Board
of Directors of SOUNDIES, Inc., a music entertainment company, since 1999 and as
the Chief Financial Officer of Navicure, Inc., a healthcare claims processing
company, since 2001. Mr. Robbins has over twenty years of investment, investment
advisory and financial executive operating experience involving a variety of
companies and industries. From 1982 through 1990, Mr. Robbins worked at Arthur
Andersen & Company. Mr. Robbins earned a BBA degree from The University of Iowa
in 1982. He is a member of the American Institute of Certified Public
Accountants and the Illinois CPA Society. Mr. Robbins is a citizen of the United
States.
MICHAEL PECHETTE
Mr. Michael Pechette serves as a Director and as Secretary of EI Acquisition and
as Founding Member of Foundation Growth Management LLC, the managing member of
Foundation Growth Investments LLC, a private investment fund. Mr. Pechette
founded and has been President of Founders Capital Corporation, a boutique
merchant bank serving middle market companies and entrepreneurs, since 1993 and
has served on the Board of Directors of SOUNDIES, Inc. since 2002. Mr. Pechette
has over twenty years of financial advisory and executive operating experience
involving technology companies such software and electronic instrumentation,
industrial companies such as plastic molders and metal fabricators and retail
companies. He has been involved in raising capital for start-ups as well as
implementing acquisitions and divestitures for established companies. He has
been responsible for the day-to-day legal and executive management of several
start-up companies and served as a financial executive in a number of $25
million revenue enterprises. Prior to establishing Founders Capital Corporation,
Mr. Pechette was a Vice President with Mansur Capital Corp., a private leveraged
buyout firm, where he was responsible for soliciting and reviewing acquisition
candidates and overseeing portfolio companies. He was also a member of The
Northern Trust Corporate Finance Department responsible for its merger and
acquisition activity. He began his career with Arthur Andersen & Company's tax
department where he specialized in the tax aspects of corporate mergers and
acquisitions. Mr. Pechette received his B.S. degree in Accounting and a J.D.
degree from Indiana University. He is a member of the Illinois and Indiana Bars
and is a Certified Public Accountant. Mr. Pechette is a citizen of the United
States.
Annex II sets forth certain information relating to Shares the Nominees
own.
Foundation Growth and EI Acquisition have agreed to indemnify each
Nominee, to the fullest extent applicable law permits, from and against any and
all expenses, liabilities or losses of any kind arising out of any threatened or
filed claim, action, suit or proceeding, whether civil, criminal, administrative
8
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or investigative, asserted against or incurred by the Nominee in his capacity as
a nominee for election as a director of the Company, or arising out of his
status as a director of the Company, if elected.
WE URGE YOU TO CONSENT TO THE ELECTION OF EACH OF THE NOMINEES
(PROPOSAL NO. 2).
9
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THE OFFER
On May 29, 2003, we commenced our Offer, which provides for our
purchase of all outstanding Shares at a price of $0.40 per Share in cash. The
purpose of our Offer is for Foundation Growth, through EI Acquisition, to
acquire for cash as many Shares as necessary for it to gain effective control of
the Company and facilitate a subsequent merger of the Company with EI
Acquisition. Foundation Growth currently intends to effect a subsequent merger
as soon as practicable following consummation of the Offer. If a subsequent
merger takes place:
o each share of Series A Preferred Stock not tendered in the Offer
that is issued and outstanding immediately prior to the date of
the Merger will convert into one share of preferred stock of the
surviving company. The terms and conditions of this new preferred
stock will be substantially similar to the Series A Preferred
Stock, except the new preferred stock will have (1) a liquidation
preference of $0.01 per share of new preferred stock over the
common stock, and (2) the right to convert each new share of
preferred stock only into its pro rata amount of 6.0% of the
fully-diluted new common stock of the surviving entity (assuming
that for purposes of determining "pro rata amount", 910,822
shares of Series A Preferred Stock into 910,822 shares of new
preferred stock). To the extent the Merger may affect the rights,
preferences and privileges of the Series A Preferred Stock, those
consequences would be the product of the Merger;
o each share of eXegenics common stock issued and outstanding
immediately prior to the effective date of the Merger (other than
shares of eXegenics common stock held by public stockholders, if
any, who are entitled to and who properly exercise their
dissenters' rights under the DGCL) will be cancelled and
extinguished and be converted into and become a right to receive
$0.40 per share (the "Offer Price"); and
o the holders of outstanding shares of EI Acquisition's capital
stock issued and outstanding immediately prior to the effective
date of the Merger shall receive for each share of EI Acquisition
held, one validly issued, fully paid and nonassessable share of
common stock of the surviving company.
VOTING SECURITIES AND PRINCIPAL HOLDERS
The common stock and the Series A Preferred Stock of the Company
constitute the voting securities and only holders of that stock are entitled to
execute consents. According to the Company's Schedule 14d-9, filed in response
to our Offer on May 29, 2003, 16,184,486 shares of common stock and 910,857
shares of Series A Preferred Stock were outstanding as of May 13, 2003.
Stockholders of the Company do not have cumulative voting rights in the election
of directors.
For information relating to the ownership of Shares by directors and
executive officers of the Company, see Annex I hereto.
10
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INFORMATION CONCERNING EI ACQUISITION AND FOUNDATION GROWTH
EI Acquisition, a Delaware corporation, is a wholly-owned subsidiary of
Foundation Growth Investments LLC, a Delaware limited liability company and a
private investment fund. The sole managing member of Foundation Growth
Investments LLC is Foundation Growth Management LLC, a Delaware limited
liability company. The members of Foundation Growth Management LLC are Terry
Robbins, Timothy Leonard, and Michael Pechette. The principal executive offices
of EI Acquisition, Foundation Growth Investments LLC, and Foundation Growth
Management LLC are located at 225 West Washington Street, Suite 2320, Chicago,
Illinois 60606, (312) 551-9900.
The information listed under "The Proposals--Election of Nominees
(Proposal No.2)" sets forth information about the Nominees, the directors,
executive officers, and managers of EI Acquisition and Foundation Growth
Investments LLC who may solicit consents and their employees and other
representatives, if any, who may also assist Morrow & Co. in soliciting
consents.
SOLICITATION OF CONSENTS
The directors, officers, managers, and other employees and agents of EI
Acquisition or Foundation Growth and its affiliates may make solicitations of
consents. Consents will be solicited by mail, advertisement, telephone,
facsimile, other electronic means and in person. None of those persons will
receive additional compensation for their solicitation efforts.
In addition, we have retained Morrow & Co. to assist in the
solicitation and to serve as the information agent in the Offer, for which we
will pay Morrow & Co. a fee of $15,000, and will reimburse Morrow & Co. for its
reasonable out-of-pocket expenses. EI Acquisition has agreed to indemnify Morrow
& Co. against various liabilities and expenses, including various liabilities
and expenses under the federal securities laws.
Banks, brokers, custodians, nominees and fiduciaries will be requested
to forward solicitation material to beneficial owners of Shares. We and our
affiliates will reimburse banks, brokers, custodians, nominees and fiduciaries
for their reasonable expenses for sending solicitation material to the
beneficial owners.
We will bear the costs of this consent solicitation and will not seek
reimbursement of those costs from the Company. Costs related to the Offer and to
the solicitation of consents include expenditures for attorneys, accountants,
printing, advertising, postage, litigation and related expenses and filing fees.
Other than the payment for Shares under the Offer, these costs are expected to
aggregate approximately $800,000. The portion of those costs allocable solely to
the solicitation of consents is not readily determinable.
CONSENT PROCEDURE
Section 228 of the DGCL states that, unless the certificate of
incorporation of a Delaware corporation otherwise provides, any action required
to be taken at any annual or special meeting of stockholders of that
corporation, or any action that may be taken at any annual or special meeting of
those stockholders, may be taken without a meeting, without prior notice and
without a vote, if a consent or consents in writing, setting forth the action so
taken, is signed by the holders of outstanding stock having not less than the
minimum number of votes that would be necessary to authorize or take that action
at a meeting at which all shares entitled to vote thereon were present and
voted, and those consents are delivered to the corporation by delivery to its
registered office in Delaware, its principal place of business or an officer or
agent of the corporation having custody of the book in which proceedings of
meetings of stockholders are recorded. Delivery made to a corporation's
registered office shall be by hand or by certified or registered mail, return
receipt requested. The Company's charter does not prohibit, and therefore
permits, the Company's stockholders to act by written consent.
Section 213(b) of the DGCL provides that the record date for
determining the stockholders of a Delaware corporation entitled to consent to
corporate action in writing without a meeting, when no prior action by the
corporation's board of directors is required and that board has not fixed that
record date, will be the first date on which a signed written consent setting
forth the action taken or proposed to be taken is delivered to the corporation
by delivery to its registered office in Delaware, its principal place of
business or an officer or agent of the corporation having custody of the book in
11
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which proceedings of meetings of the stockholders are recorded. Delivery made to
a corporation's registered office shall be by hand or by certified or registered
mail, return receipt requested. By virtue of the recent amendments made to the
Company's bylaws by the Company's directors -- amendments which are designed to
make it more difficult for you (or for us) to exercise our rights as
stockholders of the Company -- any stockholder of record seeking to have the
stockholders of the Company authorize or take corporate action by written
consent is required to request that the Company's board fix a record date. The
board must reasonably promptly, but in all events within 10 business days after
the date on which the request is received, adopt a resolution fixing the record
date for the solicitation, which record date must be no more than 10 days after
the date of the resolution. If the board does not fix a record date within 10
business days after the receipt of the request, the record date for the
solicitation will be the date on which the first signed consent is delivered to
the Company. We, as record holder, have requested the board to fix a record date
for this consent solicitation. If the board does not timely fix a record date
for the solicitation, that record date will be the date on which the first
signed consent is delivered to the Company.
If either of the Proposals become effective as a result of this consent
solicitation, prompt notice will be given under section 228(e) of the DGCL to
stockholders who have not executed consents.
An executed consent card may be revoked at any time by marking, dating,
signing and delivering a written revocation before the time that the action
authorized by the executed consent becomes effective. A revocation may be in any
written form validly signed by the record holder as long as it clearly states
that the consent previously given is no longer effective. The delivery of a
subsequently dated consent card that is properly completed will constitute a
revocation of any earlier consent. The revocation may be delivered either to
Foundation Growth Investments LLC in care of Morrow & Co., Inc. 445 Park Avenue,
New York, New York 10002. Although a revocation is effective if delivered to the
Company, we request that either the original or photostatic copies of all
revocations of consents be mailed or delivered to EI Acquisition in care of
Morrow & Co. at its address set forth above, so that we will be aware of all
revocations and can more accurately determine if and when consents to the
Proposals have been received from the holders of record on the record date for
this consent solicitation of a majority of the outstanding Shares.
SPECIAL INSTRUCTIONS
If you were a record holder of Shares as of the close of business on
the record date for this consent solicitation, you may elect to consent to,
withhold consent to or abstain with respect to each Proposal by marking the
"CONSENTS", "DOES NOT CONSENT" or "ABSTAIN" box, as applicable, underneath each
Proposal on the accompanying WHITE consent card and signing, dating and
returning it promptly in the enclosed post-paid envelope. In addition, you may
withhold consent to the election of any individual Nominee by writing that
person's name on the consent card.
IF A STOCKHOLDER EXECUTES AND DELIVERS A WHITE CONSENT CARD, BUT FAILS
TO CHECK A BOX MARKED "CONSENTS," "DOES NOT CONSENT" OR "ABSTAIN" FOR A
PROPOSAL, THAT STOCKHOLDER WILL BE DEEMED TO HAVE CONSENTED TO THAT PROPOSAL,
EXCEPT THAT THE STOCKHOLDER WILL NOT BE DEEMED TO CONSENT TO THE ELECTION OF ANY
CANDIDATE WHOSE NAME IS WRITTEN IN THE SPACE THE INSTRUCTION TO THE ELECTION
PROPOSAL PROVIDES ON THE CARD.
YOUR CONSENT IS IMPORTANT. PLEASE MARK, SIGN AND DATE THE ENCLOSED
WHITE CONSENT CARD AND RETURN IT IN THE ENCLOSED POST-PAID ENVELOPE PROMPTLY.
FAILURE TO RETURN YOUR CONSENT WILL HAVE THE SAME EFFECT AS VOTING AGAINST THE
PROPOSALS.
If your Shares are held in the name of a brokerage firm, bank nominee
or other institution, only it can execute a consent with respect to those Shares
and only on receipt of specific instructions from you. Accordingly, you should
contact the person responsible for your account and give instructions for the
WHITE consent card to be signed representing your Shares. We urge you to confirm
in writing your instructions to the person responsible for your account and
provide a copy of those instructions to Foundation Growth Investments in care of
Morrow & Co. at its address set forth above so that we will be aware of all
instructions given and can attempt to ensure that those instructions are
followed.
12
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APPRAISAL RIGHTS
The stockholders of the Company are not entitled to appraisal rights in
connection with the Proposals or the Offer. If a subsequent merger (whether a
"short-form" merger or a merger pursuant to Section 251 of the DGCL) is
consummated, however, holders of shares of common stock will have appraisal
rights under section 262 of the DGCL as discussed below. Under section 262,
holders of common stock who demand appraisal and comply with the applicable
statutory procedures will be entitled to receive a judicial determination of the
fair value of their shares of common stock (exclusive of any element of value
arising from the accomplishment or expectation of the merger) and to receive
payment of that fair value in cash, together with a fair rate of interest, if
any. Any such judicial determination of the fair value of shares of common stock
could be based on factors other than, or in addition to, the market value of the
shares of common stock. The value so determined could be more or less than the
merger consideration per share of common stock to be paid in a merger. The
holders of preferred stock will not have appraisal rights in a subsequent
merger.
EXECUTING A WRITTEN CONSENT IN FAVOR OF EACH OF THE PROPOSALS WILL NOT
PREVENT A HOLDER OF SHARES OF COMMON STOCK, AFTER CONSUMMATION OF THE OFFER,
FROM DEMANDING APPRAISAL OF THOSE SHARES IN CONNECTION WITH THE SUBSEQUENT
CONSUMMATION OF ANY MERGER.
The DGCL provides that if one corporation owns at least 90% of the
outstanding shares of each class of voting stock of another corporation, the two
corporations may merge in a "short-form" merger without a vote of shares owned
by stockholders. Accordingly, if, as a result of the Offer or otherwise, we
acquire at least 90% of the outstanding Shares and Section 203 of the DGCL and
the Rights Agreement are rendered inapplicable to us, we could, and intend to,
effect a subsequent merger as a "short-form" merger without prior notice to, or
any action by, any other stockholder of the Company. If we effect a "short-form"
merger, any remaining holders of common stock of the Company will be entitled to
exercise appraisal rights as provided by Section 262 of the DGCL.
If we cannot effect a subsequent merger as a "short-form" merger, but
acquire at least a majority of the outstanding Shares in the Offer, and Section
203 of the DGCL and the Rights Agreement are rendered inapplicable to us, we
intend to effect a subsequent merger under Section 251 of the DGCL. A merger
under Section 251 of the DGCL will require the Company's board of directors to
adopt a resolution approving an agreement and plan of merger and declaring the
advisability of same, and to submit such agreement and plan of merger to the
stockholders of the Company. Section 251 of the DGCL further requires the
affirmative vote of holders of a majority of the outstanding Shares in order to
effect such a merger. If we acquire, through the Offer or otherwise, at least a
majority of the outstanding Shares, and if we are successful in electing our
Nominees to the Company's board and the newly-comprised board removes or renders
inapplicable the various impediments to our Offer and a subsequent merger
discussed above, we would have sufficient voting power to effect a subsequent
merger without the vote of any other stockholder of the Company. If we effect a
merger in accordance with Section 251 of the DGCL, any remaining holders of
common stock of the Company will be entitled to exercise appraisal rights as
provided by Section 262 of the DGCL.
STOCKHOLDER PROPOSALS
Pursuant to the Definitive Proxy Statement, dated April 15, 2003, filed
by the Company, to be considered for inclusion in the proxy statement relating
to the Company's Annual Meeting of Stockholders to be held in 2004, stockholder
proposals must have been received not later than February 18, 2004 nor earlier
than January 29, 2004. Proposals received after February 18, 2004 will not be
voted on at the 2004 Annual Meeting. If a proposal is received before that date,
the proxies that management solicits for the meeting may still exercise
discretionary voting authority on the proposal under circumstances consistent
with the proxy rules of the SEC. All stockholder proposals should be marked for
the attention of Secretary, eXegenics Inc., 2110 Research Row, Dallas, Texas
75235.
EI ACQUISITION INC.
FOUNDATION GROWTH INVESTMENTS LLC
If you have any questions or require any assistance in executing your
consent, please call:
MORROW & CO., INC.
445 Park Avenue
New York, New York 10002
13
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Banks and Brokers, call: (800) 654-2468
STOCKHOLDERS, CALL: (800) 607-0088
All others, call collect: (212) 754-8000
The Dealer Manager and Financial Adviser to
Foundation Growth Investments LLC is:
WILLIAM BLAIR & COMPANY
222 West Adams Street
Chicago, Illinois 60606
(312) 236-1600
(800) 621-0687 ext. 5333
Dated: ______________, 2003
14
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ANNEX I
SHARES HELD BY THE COMPANY'S DIRECTORS AND EXECUTIVE OFFICERS
The following information was derived solely from a review of public
filings made with the Securities and Exchange Commission. The following table
sets forth certain information as of April 15, 2003 with respect to ownership of
the outstanding common stock of the Company by (i) all persons known to the
Company to own beneficially more than 5% of the outstanding common stock of the
Company, including their addresses, (ii) each director and executive officer of
the Company and (iii) all directors and executive officers of the Company as a
group:
SERIES A PREFERRED
COMMON STOCK STOCK
------------------------- ----------------------
PERCENT OF
DIRECTOR PERCENT PERCENT ALL VOTING
NAME AND ADDRESS OF BENEFICIAL OWNER (1) SINCE NUMBER OF CLASS (2) NUMBER OF CLASS(3) SECURITIES(4)
---------------------------------------- ----- ------ ------------ ------ ----------- -------------
Bruce Meyers(5) N/A 2,009,010 10.07% 35,433 3.89% 9.80%
Joseph M. Davie, Ph.D. (6) N/A - * - - *
Robert J. Easton (7) N/A 70,835 * - - *
Gary E. Frashier (8) N/A 256,000 1.28% - - 1.23%
Ira J. Gelb (9) N/A 177,500 * - - *
Irwin C. Gerson (10) N/A 174,500 * - - *
Joan H. Gillett (11) N/A 61,000 * - - *
Ronald L. Goode, Ph.D. (12) N/A 745,030 3.73% - - 3.57%
Walter M. Lovenberg, Ph.D. (13) N/A 178,000 * - - *
David E. Riggs (14) N/A 82,200 *
Directors and executive officers as a group 1,745,065 8.75% - - 8.37%
(9 persons) (15)
*Less than 1%
(1) Except as otherwise indicated, the address of each beneficial owner is c/o
eXegenics Inc., 2110 Research Row, Dallas, Texas 75235. (2) Calculated on the
basis of 16,184,486 shares of common stock outstanding as of March 31, 2003
except that shares of common stock underlying options and warrants exercisable
within 60 days of the date hereof are deemed to be outstanding for purposes of
calculating the beneficial ownership of securities of the holder of such options
or warrants. This calculation excludes shares of common stock issuable upon the
conversion of series A preferred stock.
(3) Calculated on the basis of 910,822 shares of series A preferred stock
outstanding.
(4) Calculated on the basis of an aggregate of 16,184,486 shares of common stock
and 910,822 shares of series A preferred stock outstanding as of March 31, 2003,
except that shares of common stock underlying options and warrants exercisable
within 60 days of the date hereof are deemed to be outstanding for purposes of
calculating beneficial ownership of securities of the holder of such options or
warrants. This calculation excludes shares of common stock issuable upon the
conversion of series A preferred stock. (5) Mr. Meyers' address is c/o
Roan/Meyers Associates, L.P., 45 Broadway, New York, New York 10004. Mr. Meyers
is the sole stockholder, officer and director of the corporate general partner
of Roan/Meyers Associates, L.P., or RMA (formerly, Janssen-Meyers Associates,
L.P.). Mr. Meyers' beneficial ownership consists of 35,800 shares of common
stock held by The Meyers Foundation, of which Mr. Meyers has voting control, and
the following securities owned by RMA: (i) 1,444,470 shares of common stock,
(ii) 33,987 shares of common stock issuable upon the exercise of a currently
exercisable unit purchase option and underlying class E warrants granted to RMA
for placement agent services in connection with our April 1998 private
placement, (iii) 1,510 shares of common stock issuable upon the exercise of
377.5 unit purchase options and underlying class C and D warrants originally
granted to 6 RMA for underwriting services in connection with our initial public
offering, (iv) 30,563 shares of common stock issuable upon the exercise of
currently exercisable class E warrants, (v) 81,529 shares of common stock
issuable upon the exercise of a unit purchase option and underlying class E
warrants granted to RMA for placement agent services in connection with our
April 1998 private placement, (vi) 125,000 shares of common stock issuable upon
the exercise of currently exercisable two-year warrants issued in 2001 to RMA,
and (vii) 250,000 shares of common stock issuable upon the exercise of currently
exercisable five-year warrants issued in 2002 to RMA. Does not include 35,433
shares of common stock issuable upon the conversion of 35,433 shares of series A
preferred stock. Except with respect to the warrants issued in 2001 and 2002,
this information was obtained from the last Schedule 13D filed by Mr. Meyers,
which was filed with the SEC on June 1, 2000.
(6) Does not include options to purchase 50,000 shares of common stock not
exercisable within 60 days of the date hereof. (7) Ownership consists of options
to purchase 70,835 shares of common stock currently exercisable or exercisable
within 60 days of the date hereof. Does not include options to purchase 54,165
shares of common stock not exercisable within 60 days of the date hereof.
(8) Ownership consists of options to purchase 256,000 shares of common stock
currently exercisable or exercisable within 60 days of the date hereof. Does not
include options to purchase 34,000 shares of common stock not exercisable within
60 days of the date hereof.
(9) Ownership consists of options to purchase 177,500 shares of common stock
that are currently exercisable or exercisable within 60 days of the date hereof.
Does not include options to purchase 31,500 shares of common stock not
exercisable within 60 days of the date hereof.
(10) Ownership consists of 1,000 shares of common stock and options to purchase
173,500 shares of common stock that are currently exercisable or exercisable
within 60 days of the date hereof. Does not include options to purchase 31,500
shares of common stock not exercisable within 60 days of the date hereof.
(11) Ownership consists of 1,000 shares of common stock and options to purchase
60,000 shares of common stock that are currently exercisable or exercisable
within 60 days of the date hereof. Does not include options to purchase 10,000
shares of common stock not exercisable within 60 days of the date hereof.
(12) Ownership consists of 111,700 shares of common stock and options to
purchase 633,330 shares of common stock that are currently exercisable or
exercisable within 60 days of the date hereof. Does not include options to
purchase 66,670 shares of common stock not exercisable within 60 days of the
date hereof.
I-1
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ANNEX I
(13) Ownership consists of 4,500 shares of common stock and options to purchase
173,500 shares of common stock currently exercisable or exercisable within 60
days of the date hereof. Does not include options to purchase 31,500 shares of
common stock not exercisable within 60 days of the date hereof.
(14) Ownership consists of 7,200 shares of common stock and options to purchase
75,000 shares of common stock currently exercisable or exercisable within 60
days of the date hereof. Does not include options to purchase 150,000 shares of
common stock not exercisable within 60 days of the date hereof.
(15) Ownership consists of 125,400 shares of common stock and options to
purchase an aggregate of 1,619,665 shares of common stock which are currently
exercisable or exercisable within 60 days of the date hereof. Does not include
options to purchase 459,335 shares of common stock not exercisable within 60
days of the date hereof.
I-2
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ANNEX II
SHARES HELD BY PARTICIPANTS AND CERTAIN TRANSACTIONS
BETWEEN ANY OF THEM AND THE COMPANY
Foundation Growth beneficially and of record owns 1,000 shares of
common stock. No part of the purchase price or market value of any of the shares
described in this paragraph was represented by funds borrowed or otherwise
obtained for the purpose of acquiring or holding those shares.
Except as this consent statement discloses, neither Foundation Growth
nor EI Acquisition, or their directors or executive officers, the Nominees or
the employees or other representatives of Foundation Growth and EI Acquisition
owns any securities of the Company or any parent or subsidiary of the Company,
beneficially or of record, has purchased or sold any of those securities within
the past two years or is or was within the past year a party to any contract,
arrangement or understanding with any person with respect to those securities.
Except as disclosed in this consent statement, to the best knowledge of
Foundation Growth, EI Acquisition, their directors or executive officers, the
Nominees and the employees and other representatives of Foundation Growth and EI
Acquisition, none of their associates beneficially owns, directly or indirectly,
any securities of the Company.
Except as this consent statement discloses, neither Foundation Growth
nor EI Acquisition, or their directors or executive officers, the Nominees, the
employees or other representatives of the EI Acquisition or Foundation Growth,
or, to their best knowledge, their associates has any arrangement or
understanding with any person (1) with respect to any future employment by the
Company or its affiliates or (2) with respect to future transactions to which
the Company or any of its affiliates will or may be a party, nor any material
interest, direct or indirect, in any transaction that has occurred since January
1, 2002 or any currently proposed transaction, or series of similar
transactions, which the Company or any of its affiliates was or is to be a party
and in which the amount involved exceeds $60,000. Except as this consent
statement discloses, none of the Nominees, directors and executive officers of
Foundation Growth or EI Acquisition and/or their respective associates are
directors or officers of other companies and organizations that have engaged in
transactions with the Company or its subsidiaries in the ordinary course of
business since January 1, 2002.
II-1
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[FORM OF CONSENT CARD]
PRELIMINARY COPY -- SUBJECT TO COMPLETION
A DEFINITIVE CONSENT CARD WILL BE FILED FOLLOWING SEC REVIEW.
WHITE EI ACQUISITION INC.
CONSENT FOUNDATION GROWTH INVESTMENTS LLC
CARD WRITTEN CONSENT SOLICITATION
OF EXEGENICS INC. STOCKHOLDERS
Unless otherwise indicated below, the undersigned, a stockholder of
record of eXegenics Inc. (the "Company") on ________________ , 2003 (the "Record
Date"), hereby consents pursuant to Section 228(a) of the Delaware General
Corporation Law with respect to all shares of common stock and Series A
Convertible Preferred Stock of the Company (the "Shares") held by the
undersigned to the taking of the following actions without a meeting of the
stockholders of the Company:
1. The removal of all directors of Company (Proposal No. 1).
|_| CONSENTS |_| DOES NOT CONSENT |_| ABSTAIN
INSTRUCTION: TO CONSENT, WITHHOLD CONSENT OR ABSTAIN FROM CONSENTING TO
THE REMOVAL OF ALL DIRECTORS, CHECK THE APPROPRIATE BOX
ABOVE.
IF NO BOX IS MARKED ABOVE WITH RESPECT TO THIS PROPOSAL, THE
UNDERSIGNED WILL BE DEEMED TO CONSENT TO SUCH PROPOSAL.
2. The election of the following persons as directors of the Company: Timothy
Leonard, Terry Robbins, and Michael Pechette (Proposal No. 2).
|_| CONSENTS |_| DOES NOT CONSENT |_| ABSTAIN
INSTRUCTION: TO CONSENT, WITHHOLD CONSENT OR ABSTAIN FROM CONSENTING TO
THE ELECTION OF ALL THE ABOVE-NAMED PERSONS, CHECK THE
APPROPRIATE BOX ABOVE. IF YOU WISH TO CONSENT TO THE ELECTION
OF CERTAIN OF THE ABOVE-NAMED PERSONS, BUT NOT ALL OF THEM,
CHECK THE "CONSENTS" BOX ABOVE AND WRITE THE NAME OF EACH
SUCH PERSON YOU DO NOT WISH ELECTED IN THE FOLLOWING SPACE:
(CONTINUED AND TO BE DATED AND SIGNED ON REVERSE SIDE)
IF NO BOX IS MARKED ABOVE WITH RESPECT TO THIS PROPOSAL, THE
UNDERSIGNED WILL BE DEEMED TO CONSENT TO SUCH PROPOSAL,
EXCEPT THAT THE UNDERSIGNED WILL NOT BE DEEMED TO CONSENT TO
THE ELECTION OF ANY CANDIDATE WHOSE NAME IS WRITTEN-IN IN THE
SPACE PROVIDED ABOVE.
IN THE ABSENCE OF DISSENT OR ABSTENTION BEING INDICATED ABOVE, THE UNDERSIGNED
HEREBY CONSENTS TO EACH ACTION LISTED ABOVE.
Please sign exactly as name
appears on stock
certificates or on label
affixed hereto. When Shares
are held by joint tenants,
both should sign. In case
of joint owners, EACH joint
owner should sign. When
signing as attorney,
executor, administrator,
trustee, guardian,
corporate officer, etc.,
give full title as such.
DATED: ___________________
Signature
Signature, if held
jointly
Title or Authority
THIS SOLICITATION IS BEING MADE BY EI ACQUISITION AND FOUNDATION GROWTH AND NOT
ON BEHALF OF THE COMPANY.
IN ORDER FOR YOUR CONSENT TO BE VALID, IT MUST BE DATED. PLEASE SIGN, DATE AND
MAIL YOUR CONSENT PROMPTLY IN THE POSTAGE-PAID ENVELOPE ENCLOSED.
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