-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, V/JEziC+JH2FpDGfOOyYUVwGumdXav6RY+LtkS+fPZcbNxpQz4/iF7kO35XlNDzU 98I+4fWvUG5lowXC84va5g== /in/edgar/work/20000814/0001072993-00-000610/0001072993-00-000610.txt : 20000921 0001072993-00-000610.hdr.sgml : 20000921 ACCESSION NUMBER: 0001072993-00-000610 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CYPRESS BIOSCIENCE INC CENTRAL INDEX KEY: 0000716054 STANDARD INDUSTRIAL CLASSIFICATION: [2836 ] IRS NUMBER: 222389839 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-12943 FILM NUMBER: 698210 BUSINESS ADDRESS: STREET 1: 4350 EXECUTIVE DRIVE,SUITE 325 CITY: SAN DIEGO STATE: CA ZIP: 92121 BUSINESS PHONE: 2062989400 MAIL ADDRESS: STREET 1: 401 QUEEN ANNE AVE NORTH CITY: SEATTLE STATE: WA ZIP: 98109 FORMER COMPANY: FORMER CONFORMED NAME: IMRE CORP DATE OF NAME CHANGE: 19920703 10-Q 1 0001.txt FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Mark One) [X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended June 30, 2000, or [_] Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from _________ to __________ Commission File Number 0-12943 CYPRESS BIOSCIENCE, INC. (Exact Name of Registrant as specified in its charter) DELAWARE 22-2389839 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 4350 Executive Drive, Suite 325, San Diego, California 92121 (Address of principal executive offices) (zip code) (858) 452-2323 (Registrant's telephone number including area code) ---------------------------------- Indicate by check (X) whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No[_] At August 6, 2000, 48,721,077 shares of Common Stock of the Registrant were outstanding. This filing, without exhibits, contains 14 pages. TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Page ---- ITEM 1 - Consolidated Balance Sheets as of June 30, 2000 (unaudited) and December 31, 1999 ............. 3 Consolidated Statements of Operations for the three and six months ended June 30, 2000 and 1999 (unaudited)............... 4 Consolidated Statements of Cash Flows for the six months ended June 30, 2000 and 1999 (unaudited)......... 5 Notes to Consolidated Financial Statements (unaudited)....... 6 ITEM 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations......................... 8 ITEM 3 - Quantitative and Qualitative Disclosures About Market Risk... 12 PART II - OTHER INFORMATION ITEM 1 - Legal Proceedings ........................................... 12 ITEM 2 - Changes in Securities and Use of Proceeds.................... 12 ITEM 3 - Defaults Upon Senior Securities.............................. 12 ITEM 4 - Submission to Matters to a Vote of Security Holders.......... 12 ITEM 5 - Other Information............................................ 13 ITEM 6 - Exhibits and Reports on Form 8-K ............................ 13 Signatures ........................................................... 14 2 CYPRESS BIOSCIENCE, INC. CONSOLIDATED BALANCE SHEETS
June 30, December 31, 2000 1999 ------------ ------------ (Unaudited) (Note) ASSETS Current assets: Cash and cash equivalents ....................... $ 11,132,373 $ 11,569,966 Accounts receivable from agreement with Fresenius 676,242 387,474 Prepaid expenses ................................ 105,925 389,180 Debt acquisition cost ........................... 116,883 144,654 ------------ ------------ Total current assets .......................... 12,031,423 12,491,274 Property and equipment, net ........................ 182,513 226,042 Other assets ....................................... 13,133 20,360 Deferred financing costs ........................... 39,152 93,796 ------------ ------------ Total assets .................................. $ 12,266,221 $ 12,831,472 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable ............................... $ 1,097,982 $ 952,932 Accrued compensation ........................... 130,606 135,211 Accrued liabilities ............................ 463,738 478,477 Current portion of convertible debentures ...... 275,000 -- Current portion of long-term obligations ....... 1,270,463 850,108 ------------ ------------ Total current liabilities ................. 3,237,789 2,416,728 Convertible debentures.............................. -- 400,000 Long-term obligations, net of current portion ...... 1,600,300 2,269,891 Stockholders' equity: Common stock, $.02 par value; 75,000,000 shares authorized, 48,708,816 and 46,314,110 shares issued and outstanding at June 30, 2000 and December 31, 1999, respectively............. 974,176 926,282 Additional paid-in capital .................... 99,274,627 94,609,138 Accumulated deficit ........................... (92,820,671) (87,790,567) ------------ ------------ Total stockholders' equity ............... 7,428,132 7,744,853 ------------ ------------ Total liabilities and stockholders' equity $ 12,266,221 $ 12,831,472 ============ ============
See accompanying notes. Note: The balance sheet at December 31, 1999 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles. 3 CYPRESS BIOSCIENCE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Quarter ended Six Months Ended June 30, June 30, 2000 1999 2000 1999 ------------ ------------ ------------ ------------ Revenue: Product sales ................ $ -- $ -- $ -- $ 588,120 Revenue from Fresenius agreement ................. 847,878 379,309 1,414,745 379,309 ------------ ------------ ------------ ------------ Total revenue ................... 847,878 379,309 1,414,745 967,429 Costs and expenses: Production costs ............. 115,859 270,141 179,569 789,626 Sales and marketing .......... 1,637,735 1,315,971 3,560,342 2,402,219 Research and development ..... 435,119 459,175 1,282,219 1,140,469 General and administrative ... 748,271 887,719 1,480,108 2,331,372 ------------ ------------ ------------ ------------ Total costs and expenses ........ 2,936,984 2,933,006 6,502,238 6,663,686 Other income (expense): Interest income .............. 198,154 140,126 351,855 192,442 Interest expense ............. (157,742) (10,790) (294,466) (22,680) Gain on sale of assets, net .. -- 693,283 -- 693,225 ------------ ------------ ------------ ------------ 40,412 822,619 57,389 862,987 ------------ ------------ ------------ ------------ Net loss ........................ $ (2,048,694) $ (1,731,078) $ (5,030,104) $ (4,833,270) ============ ============ ============ ============ Net loss per share (basic and diluted) .......... $ (0.04) $ (0.04) $ (0.10) $ (0.11) ============ ============ ============ ============ Shares used in computing net loss per share (basic and diluted). 48,647,921 43,013,276 48,133,064 42,690,634 ============ ============ ============ ============
See accompanying notes. 4 CYPRESS BIOSCIENCE, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six Months Ended June 30, 2000 1999 ------------ ------------ Operating Activities: Net loss .............................................. $ (5,030,104) $ (4,833,270) Adjustments to reconcile net loss to net cash used by operating activities: Depreciation and amortization .................... 55,238 190,505 Amortization of deferred compensation ............ -- 239,446 Loss on disposal of property and equipment ....... -- 94,625 Common stock issued for services and expenses .... 107,739 121,750 Changes in operating assets and liabilities, net . 154,536 837,051 ------------ ------------ Net cash used by operating activities ........ (4,712,591) (3,349,893) Investing Activities: Purchase of equipment .............................. (11,708) (112,346) Proceeds from business transferred ................. -- 3,216,667 Proceeds from sale of assets ....................... -- 14,900 ------------ ------------ Net cash provided by (used in) investing activities ...................... (11,708) 3,119,221 Financing Activities: Payment of notes payable ........................... (246,235) (16,117) Deferred financing costs ........................... 82,415 -- Proceeds from exercise of stock options and warrants 4,453,527 6,098,891 Proceeds from private placement of common stock and warrants ................................... -- 1,500,000 Payment of capital lease obligations ............... (3,001) (12,987) ------------ ------------ Net cash provided by financing activities .... 4,286,706 7,569,787 Increase (decrease) in cash and cash equivalents ...... (437,593) 7,339,115 Cash and cash equivalents at beginning of period ... 11,569,966 5,619,568 ------------ ------------ Cash and cash equivalents at end of period ......... $ 11,132,373 $ 12,958,683 ============ ============ Supplemental disclosure of cash flow information Interest paid ...................................... $ 205,469 $36,801 ============ ============
See accompanying notes. 5 CYPRESS BIOSCIENCE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Formation and Business of the Company The accompanying consolidated financial statements have been prepared by Cypress Bioscience, Inc. (the "Company") without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to the rules and regulations of the SEC. The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated. In the opinion of the Company's management, all adjustments necessary for a fair presentation of the accompanying unaudited financial statements are reflected herein. All such adjustments are normal and recurring in nature. Interim results are not necessarily indicative of results for the full year. For more complete financial information, these consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's 1999 Annual Report on Form 10-K/A filed with the SEC. The Company markets the PROSORBA(R) column for the treatment of types of rheumatoid arthritis ("RA") and idiopathic thrombocytopenia purpura ("ITP"), which are types of immune disorders, and is engaged in the development of novel therapeutic agents for the treatment of blood platelet disorders. The PROSORBA column absorbs antibodies and circulating immune complexes and modulates the patient's inappropriate immune response to certain diseases. In March 1999, the Food and Drug Administration ("FDA") granted Cypress marketing clearance to distribute the PROSORBA column for the treatment of moderate to severe RA. The Company previously received marketing clearance from the FDA in December 1987 to distribute the PROSORBA column for the treatment of ITP, an immune-mediated bleeding disorder. The Company is also developing Cyplex(TM), a platelet alternative, previously known as Infusible Platelet Membranes, as an alternative to traditional platelet transfusions. 2. Fresenius Agreements In March 1999, Cypress entered into an agreement with Fresenius AG of Bad Homburg, Germany and its U.S. subsidiary, Fresenius Hemotechnology, Inc. ("FHI"). The agreement provides Fresenius with an exclusive license to distribute the PROSORBA column in the U.S., Europe, Latin America, and subject to certain conditions, Japan and certain other countries. Upon signing of the agreement, Cypress received a total of $1.5 million from Fresenius consisting of the purchase of 297,530 shares of Cypress common stock for $1.0 million, and $500,000 for the purchase of three-year warrants to buy 342,466 shares of Cypress common stock at $7.50 per share. In the U.S., Cypress and FHI jointly market the PROSORBA column. Cypress and FHI share in clinical trials and sales and marketing expenses in the U.S., subject to certain annual dollar limits. Fresenius has exclusive distribution rights and responsibility for clinical trials and 6 registration of the product overseas. In the U.S., net profit is split 50/50 until PROSORBA column revenue reaches a pre-determined sales threshold, after which time Cypress will receive 60% of the profits and Fresenius will receive 40%. Net profits will be split 50/50 outside the United States. Revenue from the Fresenius agreement for the quarter and six months ended June 30, 2000 consisted of Cypress's pro rata share of sales by Fresenius. Until profits are generated, Cypress will recognize revenue based on the payments from Fresenius, which are generally determined as the ratio of allowable expenses incurred for production, research and development and sales and marketing by Cypress compared to allowable expenses incurred by Cypress and Fresenius under the agreement. The agreement also included an option for Fresenius to purchase assets used in Cypress' manufacturing facilities in Redmond, Washington. In April 1999, Fresenius exercised its option and acquired the asset related to the PROSORBA column manufacturing function for $5.2 million. During 1999 Cypress recorded a total gain on the sale of approximately $2.5 million recognized from inventory and manufacturing assets. 3. Inventories In April 1999, Fresenius acquired the PROSORBA column manufacturing facility. As a result the Company had no inventory as of June 30, 2000 or December 31, 1999. 4. Net Loss Per Share The computation of net loss per share is based on the weighted average number of shares of common stock outstanding for each period. Common stock equivalents related to options, warrants and convertible debentures are excluded, as their effect is antidilutive. 7 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Except for the historical information contained herein, the following discussion contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 that involve risks and uncertainties. The Company's actual results could differ materially from those discussed below and elsewhere in this 10-Q. Factors that could cause or contribute to such differences include, without limitation, those discussed in this section, as well as other sections of this 10-Q, and those discussed in the Company's Annual Report on Form 10-K/A for the year ended December 31, 1999. Company Overview In March 1999, the Company entered into an agreement with Fresenius Hemotechnology Inc. ("FHI"), a U.S. subsidiary of Fresenius AG ("Fresenius") of Bad Homburg, Germany. FHI is a leading provider of apheresis equipment and disposables. The agreement provides Fresenius with an exclusive license to manufacture and distribute the PROSORBA column in the U.S., Europe, Latin America, and subject to certain conditions, Japan and certain other countries. In April 1999, the Company and Fresenius launched the sale of the PROSORBA column for the treatment of moderate to severe rheumatoid arthritis ("RA") in adult patients with long standing disease who have failed or are intolerant to disease-modifying anti-rheumatic drugs ("DMARDs"). The PROSORBA column had been previously approved for idiopathic thrombocytopenia purpura ("ITP"), a rare hematologic disorder. Also in April 1999, Fresenius exercised its option to acquire the PROSORBA column manufacturing facility and related assets, located in Redmond, Washington, for $5.2 million. During 1999 Cypress recorded a total gain on the sale of $2.5 million. Results of Operations Sales of the PROSORBA column are booked as revenues by FHI, based on the terms of the partnership agreement. Expenses incurred related to the PROSORBA column are reimbursed to the party incurring such expenses. Until profits are generated, Cypress will recognize revenue based on the payments from Fresenius, which are generally determined as the ratio of allowable expenses incurred for production, research and development and sales and marketing by Cypress compared to allowable expenses incurred by Cypress and Fresenius under the agreement. In the U.S., net profit is split 50/50 until PROSORBA column revenue reaches a pre- determined sales threshold, after which time Cypress will receive 60% of the profits and Fresenius will receive 40%. Net profits will be split 50/50 outside the United States. Total PROSORBA column sales for the quarter and six months end ended June 30, 2000 totaled $2.3 million and $3.6 million respectively, compared to $585,000 and $1.2 million for the same periods of 1999. The increase in PROSORBA columns sales for the quarter and six months ended June 30, 2000 compared to the same periods of 1999 is a result of the Company's sales and marketing efforts to market the PROSORBA column for the RA indication, and a bulk purchase of 1,000 columns in June 2000 by Fresenius Medical Care North America ("FMCNA"), a subsidiary of Fresenius Medical Care AG. Earlier this year, Cypress announced a pilot program with FMCNA to facilitate the delivery of apheresis treatments using the PROSORBA column in the rheumatologist's office. The 1,000 PROSORBA columns purchased in June were purchased to support this program. FMCNA has committed to purchase up to an additional 3,000 8 PROSORBA columns in the second half of 2000. These columns will be used to support the pilot program as well as existing contracts FMCNA already has in place with approximately 200 hospitals to provide therapeutic apheresis treatment in the traditional hospital outpatient setting. Total revenue recorded by Cypress for the second quarter of 2000 was $848,000, compared to $379,000 for the same period in 1999. Total revenues for the six months ended June 30, 2000 totaled $1.4 million compared to $967,000 for the same period of 1999. Prior to April 1999, Cypress recorded sales of the PROSORBA column as product revenue. As a result, total revenue reported by Cypress for the quarter and six months ended June 30, 2000 is not comparable to the same periods of 1999. The increase in revenue from the Fresenius agreement in 2000 is a result of the increased sales of the PROSORBA column as previously stated, which in turn led to an increase in revenue from the Fresenius arrangement allocated to Cypress. Operating expenses for the quarter and six month period ended June 30, 2000 were $2.9 million and $6.5 million, respectively, compared to $2.9 million and $6.7 million for the same time periods in 1999. As a result of Fresenius' purchase of the Company's manufacturing plant in April 1999, the Company does not include manufacturing costs in production expenses for the PROSORBA column after April 1999. Therefore, operating expenses for the periods in 2000 are not directly comparable to the periods in 1999. Nevertheless, total operating expenses were relatively consistent, due to decreases in production expense and general and administrative expenses, offset by an increase in sales and marketing expenses. Production expenses were $116,000 and $180,000 for the quarter and six months ended June 30, 2000, respectively, compared to $270,000 and $790,000 for the comparable periods in 1999. Production costs decreased during the quarter and six months ended June 30, 2000 due to Fresenius' acquisition of the PROSORBA column manufacturing facility in April 1999. As a result, the Company did not record production costs associated with manufacturing the PROSORBA column during the period of January through April of 2000, as it had during the same period of 1999. As of April 1999, production expenses are comprised of royalties based on total sales. The royalties are a result of license agreements on patents associated with the manufacturing of the PROSORBA column. Sales and marketing expenses were $1.6 million and $3.6 million for the quarter and six months ended June 30, 2000, respectively, up from $1.3 million and $2.4 million for the same periods of 1999. The increase of approximately 24% and 48% for the quarter and six months ended June 30, 2000, respectively, from the same periods of 1999 are due to sales and marketing efforts associated with PROSORBA column for the RA indication. These efforts were launched in April 1999, and as a result, the quarter and six months ended June 30, 2000 reflect marketing expenses associated with the PROSORBA column or the RA indication in each month, while the same periods in 1999 do not. The Company expects sales and marketing expenses to increase over the next two quarters as a result of attendance at trade shows and sales and marketing training costs associated with turnover within the sales group increase. In the U.S., Cypress and Fresenius will jointly market the PROSORBA column. Research and development expenses were $435,000 and $1.3 million for the quarter and six months ended June 30, 2000, respectively, compared to $460,000 and $1.1 million for the 9 corresponding periods of 1999. Expenses for the second quarter 2000 compared to the same period of 1999 were relatively consistent. For the six months ended June 30, 2000 total research increased approximately $142,000 compared to the same period of 1999. The increase is due to costs incurred for a February 2000 investigator recruitment meeting jointly sponsored by Fresenius and Cypress, and was partially offset by the absence of costs associated with the FDA clearance process, which were incurred during the first quarter of 1999. The Company initiated one of its two mandatory post approval trials in the second quarter of 2000. Patient enrollment in the trial is expected during the third quarter of 2000. The second trial is expected to begin later this year. The Company expects to incur higher research and development expenses in connection with the mandatory trials as patient enrollment increases in each of the trials, and Cyplex research and development expenses begin to increase during the second half of 2000. General and administrative expenses were $748,000 and $1.5 million for the quarter and six months ended June 30, 2000, respectively, down from $888,000 and $2.3 million for the comparable periods of 1999. The decrease of $139,000 in expense for the quarter ended June 30, 2000 from the same period of 2000 is primarily related to decreased professional fees incurred in 1999. The decrease of $851,000 in expenses for the six months ended June 30, 2000 compared to the same period of 1999 is related to a decrease in business development activity in 2000 compared to 1999, primarily associated with negotiating the Company's agreement with Fresenius. The Company expects to incur higher general and administrative expenses during the third quarter of 2000 as previously agreed upon retention bonuses are paid to the Company's executive management. Additionally, in August of 2000 the Company's president and Chief Operating Officer elected to terminate his employment with the Company to pursue other opportunities. The Company is in the process of identifying a replacement. Liquidity and Capital Resources The Company's cash and cash equivalents at June 30, 2000 totaled $11.1 million, compared to $11.6 million at December 31, 1999. The net decrease in cash is primarily due to the proceeds of approximately $4.5 million from the exercises of stock options, offset by $4.7 million cash used in operations. Working capital at June 30, 2000 totaled $8.8 million. The Company believes its cash and cash equivalents balance on June 30, 2000, together with the revenues the Company anticipates will be received under the Fresenius agreement, are sufficient to fund operations through the year 2000. In addition, to the extent the Company decides to develop and/or acquire products other than the PROSORBA column, including Cyplex(TM), it will be required to raise additional capital. The amount of capital required by the Company is dependent upon many factors, including the following: the Company's ability to successfully market the PROSORBA column for the RA indication, results of and the costs associated with the mandatory post approval clinical trials, results of current research and development efforts, the FDA regulatory process, costs of commercialization of products and potential competitive and technological advances and levels of product sales. Because the Company is unable to predict the outcome of the foregoing factors, some of which are beyond the Company's control, the Company is unable to estimate with certainty its mid to long-term capital needs. Although the Company is seeking to raise additional capital through a combination 10 of additional equity sources, there is no assurance the Company will be able to raise additional capital through such sources or the funds raised thereby will allow the Company to maintain its current and planned operations. If the Company is unable to obtain additional capital, it will be required to delay, scale back or eliminate some or all of its planned research and development activities related to additional product opportunities. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK The Company invests its excess cash in U.S. government securities and money market funds with strong credit ratings. As a result, the Company's interest income is most sensitive to changes in the general level of U.S. interest rates. The Company does not use derivative financial instruments, derivative commodity instruments or other market risk sensitive instruments, positions or transactions in any material fashion. Accordingly, the Company believes that, while the investment-grade securities it holds are subject to changes in the financial standing of the issuer of such securities, the Company is not subject to any material risks arising from changes in interest rates, foreign currency exchange rates, commodity prices, equity prices or other market changes that affect market risk sensitive instruments. 11 PART II - OTHER INFORMATION ITEM 1 - LEGAL PROCEEDINGS On November 1, 1989, the Company entered into a Distribution Agreement with Ditassa S.A. with respect to the distribution of the PROSORBA column in the territory of Spain. The Company terminated the Ditassa Agreement in May 1999. However, Ditassa has claimed that the Company breached the Ditassa Agreement both during the term of the Ditassa Agreement and by terminating the Ditassa Agreement and has requested monetary damages. If the resolution of these claims is not in favor of Cypress, it may have a material adverse effect on the Company's results of operations, liquidity and financial position. However, the Company believes that the claims made by Ditassa are without merit and will vigorously defend against the claims. ITEM 2 - CHANGES IN SECURITIES AND USE OF PROCEEDS Not applicable ITEM 3 - DEFAULTS UPON SENIOR SECURITIES Not applicable ITEM 4- SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS The Annual Meeting of Stockholders (the "Annual Meeting") of the Company was held on July 27, 2000. The Company had 48,655,895 shares of common stock outstanding and entitled to vote as of June 9, 2000, the date of record of the meeting. At the meeting holders of a total of 42,059,451 shares of common stock were present in person or represented by proxy. The following sets forth a brief description of each matter voted upon at the Annual Meeting and the results of the voting on each such matter: (1) For the elections of the nominees as class of 2003 directors: Withheld Authority For or Against ------------------ ------------------ Jay D. Kranzler, M.D., Ph.D.. 41,730,007 329,444 David Golde, M.D ............. 41,730,007 329,444 The Company's Board of Directors is comprised of the individuals elected this year and the following directors completing the following terms: Jack Vaughn and Sam Anderson, whose terms expire in 2001, and Mark C. Rogers, M.D. and Larry J. Kessel, M.D., whose terms expire in 2002. (2) To approve the Company's 2000 Equity Incentive Plan which provides grant of incentive stock options, nonstatutory stock options, stock bonuses and restricted stock purchase awards. For Against Abstained ---------------- --------------- --------------- 21,714,715 1,717,363 118,432 12 (3) To ratify the Board's selection of Ernst & Young LLP to continue as the Company's independent auditors for the fiscal year ending December 31, 2000. Stockholder ratification of the selection of Ernst & Young as the Company's independent auditors is not required by the Company's Bylaws or otherwise. However, the Board is submitting the selection of Ernst & Young to the stockholders for ratification as a matter of good corporate practice. For Against Abstained ---------------- --------------- --------------- 41,902,829 102,638 53,984 ITEM 5 - OTHER INFORMATION Not applicable ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 27.1 Financial Data Schedule (b) Reports on Form 8-K None 13 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Cypress Bioscience, Inc. August 14, 2000 /s/ Jay D. Kranzler ------------------- Chief Executive Officer, Chief Financial Officer and Chairman of the Board (Principal Executive Officer and Principal Financial and Accounting Officer) 14 EX-27 2 0002.txt ARTICLE 5 FDS
5 1,000 3-MOS 6-MOS DEC-31-2000 DEC-31-2000 APR-01-2000 JAN-01-2000 JUN-30-2000 JUN-30-2000 11,132 11,132 0 0 676 676 0 0 0 0 12,031 12,031 596 596 (414) (414) 12,266 12,266 3,238 3,238 0 0 0 0 0 0 974 974 99,275 99,275 12,266 12,266 0 0 848 1,415 116 180 2,937 6,502 0 0 0 0 158 294 (2,049) (5,030) 0 0 (2,049) (5,030) 0 0 0 0 0 0 (2,049) (5,030) (0.04) (0.10) (0.04) (0.10)
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