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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-KSB/A
(AMENDMENT NO. 1)
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[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO .
COMMISSION FILE NUMBER 000-24693
NUTRACEUTIX, INC.
(NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)
DELAWARE 91-1689591
(STATE OF INCORPORATION) IRS EMPLOYER IDENTIFICATION NO.)
8340 154TH AVENUE N.E., REDMOND, WASHINGTON 98052
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
ISSUER'S TELEPHONE NUMBER: (425) 883-9518
SECURITIES REGISTERED UNDER SECTION 12(b) OF THE EXCHANGE ACT: NONE
SECURITIES REGISTERED UNDER SECTION 12(g) OF THE EXCHANGE ACT:
COMMON STOCK, $.001 PAR VALUE
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 [ ]
Check if disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB. [X]
The issuer's revenues for the fiscal year ended December 31, 2001 were
$8,190,500.
The aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked price of such stock, as of March 20, 2002 was approximately
$22,704,402.
As of March 20, 2002, there were 19,852,289 shares outstanding of the
issuer's common stock.
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DOCUMENTS INCORPORATED BY REFERENCE
None. See Explanatory Note below.
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EXPLANATORY NOTE
The Company is filing this Amendment No. 1 to its Annual Report on Form
10-KSB for the year ended December 31, 2001 to amend Items 9 through 12 of Part
III of this Annual Report on Form 10-KSB to include the information required by
such items because the Company's definitive proxy statement will not be filed
before April 30, 2002 pursuant to Regulation 14A. No other changes are being
made by means of this filing.
The following items of the Company's Annual Report on Form 10-KSB for the
fiscal year ended December 31, 2001 are hereby amended. Each such item is set
forth in its entirety as amended.
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PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(a) OF THE EXCHANGE ACT
DIRECTORS AND EXECUTIVE OFFICERS
The following table identifies the directors and executive officers of the
Company as of April 19, 2002, the positions which they hold, and the year in
which they began serving in their respective capacities.
POSITION HELD
NAME AGE CURRENT POSITION(S) WITH COMPANY SINCE
---- --- -------------------------------- -------------
David T. Howard.......... 52 President and CEO, Director 2000
(Class 2, exp. 2003)
Steven H. Moger.......... 38 Chief Financial Officer and 1997
Vice President of Operations
Herbert L. Lucas......... 74 Director (Class 2, exp. 2003) 1995
Daniel B. Ward........... 74 Director (Class 3, exp. 2004) 1995
David T. Howard has served as the Company's President and CEO and as a
director since May 24, 2000. From August 1997 to March 2000, Mr. Howard served
as President and Chief Executive Officer of Novopharm International. Prior to
that position, he was President of Granutec, Inc. from July 1995 through
December 1997 and President of Stanley Pharmaceuticals from January 1990 to
December 1999. Mr. Howard serves on the board of Angiotech Pharmaceuticals, Inc.
Steven H. Moger has served in various financial management positions for
the Company since 1986. From 1993 to 1997, Mr. Moger served as the
Controller/General Manager of the Company. In December of 1997 Mr. Moger was
promoted to Vice President of Operations/General Manager. Mr. Moger received his
BA in Accounting from Western Washington University in 1986 and obtained his CPA
in 1989.
Herbert L. Lucas has served as a member of the Company's Board of Directors
since 1995, and as a director of BioTechniques Laboratories, Inc., ("BTL") a
subsidiary of the Company, since 1983. Mr. Lucas was with Carnation
International, a multinational food processing company, from 1963 to 1981,
rising to the position of President and Director. Mr. Lucas serves on the board
of several corporations and non-profit institutions, including the Wellington
Trust Company, Boston, The J. Paul Getty Trust, Los Angeles, and the Winrock
International Institute for Agricultural Development, Morrilton, Arkansas. Mr.
Lucas received his BA from Princeton University in 1950 and MBA from the Harvard
University School of Business Administration in 1952.
Daniel B. Ward has served as a member of the Company's Board of Directors
since 1995 and as a director of BioTechniques Laboratories, Inc., ("BTL"), a
subsidiary of the Company, since 1983. Mr. Ward has had his own financial
consulting firm since 1977 which specializes in mergers and acquisitions. From
1976 to 1977, Mr. Ward was Vice President of Finance for Norfin, Inc., a
business machine manufacturer. From 1972 to 1975 he was Regional Director of the
Small Business Administration and from 1966 to 1972 was Director of the
Washington State Department of Commerce and Economic Development. Mr. Ward
received his BA from Princeton University in 1950.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the 1934 Act requires the Company's directors and
executive officers and persons who own more than ten percent of the outstanding
shares of the Company's common stock ("ten percent stockholders") to file with
the SEC initial reports of beneficial ownership and reports of changes in
beneficial ownership of shares of common stock and other equity securities of
the Company. To the Company's knowledge, based solely on a review of the copies
of such reports furnished to the Company or otherwise in its files and on
written representations from its directors, executive officers and ten percent
shareholders no other reports were required during the fiscal year ended
December 31, 2001. The Company's officers, directors and ten percent
stockholders complied with all applicable Section 16(a) filing requirements.
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ITEM 10. EXECUTIVE COMPENSATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table shows all the cash compensation, as well as certain
other compensation, paid by the Company to the President and CEO, and each of
the Company's other highly compensated executive officers (the "named executive
officers") during the fiscal years indicated. No other officer earned total
salary and bonus in excess of $100,000 for the periods indicated.
2001 SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
--------------------------------- ------------
OTHER SECURITIES
ANNUAL UNDERLYING
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION OPTIONS
--------------------------- ---- ------ ----- ------------ ----------
David T. Howard, President and CEO 2001 210,000(1) -0- 10,800(2) -0-
2000 127,346(1) -0- 6,300(2) 800,000
1999 -0- -0- -0- -0-
Steven H. Moger, 2001 139,583(3) -0- -0- 110,000
Chief Financial Officer and 2000 110,000(3) -0- -0- -0-
Vice President of Operations 1999 110,000(3) -0- -0- 20,000
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(1) Mr. Howard's date of hire was May 24, 2000. His annual salary is $210,000.
(2) Mr. Howard received a car allowance of $10,800 during 2001 and $6,300
during 2000.
(3) Mr. Moger received an annual base salary of $110,000 until February 2001.
From March 2001 to May 2001, his annual salary was $135,000. In June 2001,
his annual salary was increased to $150,000.
The following table sets forth all individual grants of stock options made
by the Company during the fiscal year ended December 31, 2001 to the named
executive officers.
OPTION GRANTS IN LAST FISCAL YEAR
NUMBER OF
SECURITIES PERCENT OF TOTAL EXERCISE
UNDERLYING OPTIONS GRANTED TO OR BASE
OPTIONS EMPLOYEES IN PRICE EXPIRATION
NAME GRANTED(#) FISCAL YEAR(1) ($/SHARE) DATE
---- ---------- ------------------ ---------- ----------
David T. Howard...... -- -- -- --
Steven H. Moger...... 100,000 14.0% 0.66 02/09/11
10,000 1.4% 0.56 05/24/11
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(1) Based on stock options representing an aggregate of 696,840 shares of common
stock granted to employees during the year ended December 31, 2001.
4
The following table sets forth information on an aggregated basis,
concerning the exercise of stock options during the year ended December 31, 2001
by each of the named executive officers and the fiscal year-end value of the
unexercised options.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS AT
SHARES ACQUIRED VALUE REALIZED AT FY-END(#) FY-END($)(2)
NAME ON EXERCISE(#) ($)(1) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
---- --------------- -------------- ------------------------- -------------------------
David T. Howard -- -- 160,000/640,000 --
Steven H. Moger -- -- 124,167/98,333 18,600/200
(1) Market value of the underlying securities at exercise date minus exercise
price of the options.
(2) The closing price of the Company's stock as of December 31, 2001 was $0.53.
Except as set forth above, the exercise price of all options held by the
named executive officers set forth in the table exceeds the market value of
the underlying shares.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL
ARRANGEMENTS
The Company had a three year employment contract with William D. St. John,
which commenced on April 1, 1998, and which was renewable for an additional
three-year period unless either party gave 180 days notice to the other. The
employment agreement provided for an initial base annual salary of not less than
$150,000. As of October 1, 1998, the base salary paid to Mr. St. John increased
from $150,000 to $175,000. Mr. St. John resigned, as an officer and director of
the Company, effective as of January 15, 2001 and the employment contract was
superseded and replaced with a Separation Agreement. See "Certain Relationships
and Related Transactions."
DIRECTOR COMPENSATION
The Company pays no additional remuneration to employees of the Company who
serve as directors. All directors are entitled to reimbursement for expenses
incurred in traveling to and from meetings of the Company's Board of Directors.
Effective September 24, 1999 and as further clarified on March 27, 2000, the
Board of Directors has adopted the following compensation plan for nonemployee
directors ("Eligible Directors"): (a) on October 1 of each year each Eligible
Director is granted an option exercisable for 30,000 shares of the Company's
common stock at an exercise price equal to the closing price of the Company's
common stock on the date of grant, which option shall be fully vested as of the
date of grant, (b) on October 1 of the first year of service, each new Eligible
Director is granted an option for 2,500 shares for each whole month of service
prior to October 1, (c) in the event an Eligible Director resigns prior to
October 1 in any year, such eligible Director is granted an option on October 1
of the year of resignation for 2,500 shares for each whole month of service
completed prior to the date of resignation, and (d) each Eligible Director
receives a quarterly cash retainer paid in arrears in the amount of $3,750 for
services as a Director. In accordance with this compensation policy, on October
1, 2001, Mr. Lucas and Mr. Ward (together with two other non-employee directors
who are no longer serving) were each granted nonqualified stock options
exercisable for 30,000 shares of the Company's common stock at an exercise price
of $0.38 per share. In addition, on February 9, 2001, Mr. Lucas and Mr. Ward
(together with two other non-employee directors who are no longer serving) were
each also granted a nonqualified stock option fully exercisable for 25,000
shares of the Company's common stock at an exercise price of $0.66 per share.
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ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of March 31, 2002, certain information
furnished to the Company with respect to ownership of the Company's common stock
of (i) each director and director nominee, (ii) each executive officer, (iii)
all persons known by the Company to be beneficial owners of more than five
percent (5%) of the Company's common stock, and (iv) all executive officers and
directors as a group.
NUMBER PERCENT OF
OF SHARES
STOCKHOLDER SHARES OUTSTANDING(1)
----------- ------ --------------
Archer-Daniels-Midland Company....................... 1,920,000 9.67%
4666 Faries Parkway
Decatur, IL 62526
William D. and Patricia A. St. John(2) .............. 1,122,867 5.66%
3959 Lower Honoapiilani Road, #309
Lahaina, Maui, HI 96761
David T. Howard(3)................................... 320,000 1.59%
Herbert L. Lucas(4).................................. 723,824 3.60%
Daniel B. Ward(5).................................... 308,000 1.53%
Steven H. Moger(6) .................................. 353,636 1.77%
All directors and executive officers as a group
(4 persons)(7)..................................... 1,705,460 8.18%
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission, and includes voting and investment
power with respect to shares. Except as otherwise indicated, the
stockholders identified in this table have sole voting and investment power
with regard to the shares shown as beneficially owned by them. Shares of
common stock subject to options or warrants currently exercisable or
exercisable within 60 days of March 31, 2002 are deemed outstanding for
computing the percentage ownership of the person holding such options or
warrants, but are not deemed outstanding for computing the percentage of
any other person.
(2) Information regarding William D. St. John and Patricia A. St. John is based
solely on a Schedule 13G filed with the SEC on February 11, 2002.
(3) Includes 320,000 shares subject to options exercisable as of May 30, 2002.
(4) Includes 265,000 shares subject to options exercisable as of May 30, 2002.
(5) Includes 265,000 shares subject to options exercisable as of May 30, 2002.
(6) Includes 142,500 shares subject to options exercisable as of May 30, 2002.
(7) Includes 992,500 shares subject to options exercisable as of May 30, 2002.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company and William D. St. John entered into a Separation Agreement
pursuant to which Mr. St. John's employment as a director and Chairman of the
Board with the Company ceased as of January 15, 2001. The Separation Agreement
superseded and replaced his employment agreement with the Company. Pursuant to
the terms of Mr. St. John's Separation Agreement, he is entitled to receive 36
monthly severance payments of $12,500, subject to certain offsets against future
earnings. Additionally, Mr. St. John's options for 85,000 shares of the
Company's common stock became fully vested and were converted into nonqualified
options, exercisable until January 31, 2002.
6
The Company and Patricia A. St. John, wife of Mr. St. John, entered into a
Separation Agreement pursuant to which Mrs. St. John's employment as Vice
President Administration, Secretary and Treasurer ceased as of January 15, 2001.
Pursuant to the terms of the Separation Agreement, Mrs. St. John is entitled to
12 monthly severance payments of $7,088.33 for the period January 15, 2001 to
January 15, 2002. Additionally, Mrs. St. John's options for 94,000 shares of the
Company's common stock became fully vested and were converted into nonqualified
options, exercisable until January 31, 2002.
As part of the sale of shares of common stock described in Item 5 in
December 2001, the Company sold 205,000 shares for $80,000 to Ed Moger, Jr.
brother of Steve Moger. The sale was exempt from registration under the
Securities Act of 1933, as amended, pursuant to Rule 506 of Regulation D and
Section 4(2) of such Act.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed by the undersigned thereunto
duly authorized.
NUTRACEUTIX, INC.
By: /s/ DAVID T. HOWARD
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David T. Howard
President, Chief Executive Officer
April 26, 2002
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