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Biotech / Medical : Kosan BioSciences -- KOSN -- Ignore unavailable to you. Want to Upgrade?

To: keokalani'nui who wrote (305)	7/4/2003 10:07:57 AM
From: rkrw	Read Replies (1) \| Respond to of 933

From the proxy...looks like Johnson waited to the end to take care of his debt. Have to give Kosan credit for not "forgiving" the debt. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Since January 1, 2002, there has not been, nor is there currently proposed, any transaction or series of similar transactions to which the Company was or is to be a party in which the amount involved exceeds $60,000 and in which any current director, executive officer or holder of more than 5% of the Company’s common stock had or will have a direct or indirect interest other than compensation arrangements, described under the caption “Executive Compensation,” and the transactions described below. PROMISSORY NOTES Prior to our initial public offering, stock options granted under our 1996 Stock Option Plan are immediately exercisable as to both vested and unvested shares, with unvested shares being subject to a right of repurchase in our favor in the event of termination of employment or consultancy prior to vesting of all shares. These individuals paid the exercise price for their outstanding options pursuant to full recourse promissory notes secured in part by the common stock underlying the options. The notes bear interest at the Applicable Mid-Term Federal Rate at the time of exercise. Principal and interest is due on the earlier of the employee’s or consultant’s termination date or three years after the date of the promissory note. In December 2001, we entered into an agreement with Daniel V. Santi, M.D., Ph.D., to amend the terms of his original promissory note. Under the terms of the amended agreement, the loan for the outstanding principal and interest of the original loan for the amount of $212,426 bore interest at 5.14% and was due and fully repaid on December 23, 2002. As of December 31, 2002, the original and outstanding principal amounts of each promissory note held by an executive officer are set forth below: Officer Issuance Date Original Note Outstanding Note Amount Interest Rate Accrued Interest Ostrach Feb 2000 $74,250 $16,850 6.46% $3,563 Johnson Sept 2000 768,000 732,200 6.13% 108,576 Kanaya Feb 2000 50,000 22,000 6.46% 4,516 Kanaya April 2000 15,000 8,500 6.60% 1,671