BIGMAR INC, DEF 14A, 1997-06-27

BIGMAR INC
DEF 14A, 1997-06-27
PHARMACEUTICAL PREPARATIONS

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SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /

Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12

BIGMAR, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy 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)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction 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):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
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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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<PAGE>
[LOGO]

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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JULY 28, 1997

------------------------

Dear Stockholder:

You are cordially invited to attend the First Annual Meeting of Stockholders
(the "Annual Meeting") of Bigmar, Inc., a Delaware corporation (the "Company"),
at The Cherry Valley Lodge, 2299 Cherry Valley Road, Newark, Ohio on July 28,
1997 at 3:00 p.m. Eastern Daylight Savings Time. The purposes of this Annual
Meeting are:

(1) To elect six directors to serve for a term to expire at the annual
meeting of stockholders of the Company in the year 1998;

(2) To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.

The Board of Directors has fixed the close of business on June 20, 1997, as
the record date for determining the stockholders entitled to notice of, and to
vote at, the Annual Meeting and at any adjournment or postponement thereof.

Following the formal meeting, we will review the Company's progress during
the last fiscal year and our plans for fiscal 1997 and answer your questions
regarding the Company. Board members and executive officers will also be
available to discuss the Company's operations with you.

Yours truly,

John G. Tramontana
CHAIRMAN OF THE BOARD OF DIRECTORS

Dated: June 20, 1997

WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE VOTE, SIGN AND
PROMPTLY RETURN YOUR PROXY CARD IN THE ENCLOSED ENVELOPE. PROXIES MAY BE REVOKED
BY WRITTEN NOTICE OF REVOCATION, THE SUBMISSION OF A LATER PROXY, OR BY
ATTENDING THE MEETING AND VOTING IN PERSON. (If your shares are held of record
by a broker, bank or other nominee and you wish to attend the Annual Meeting,
you must obtain a letter from the broker, bank or other nominee confirming your
beneficial ownership of the shares and bring it to the meeting. In order to vote
your shares at the Annual Meeting, you must obtain from the record holder a
proxy issued in your name.)
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[LOGO]

6660 DOUBLETREE AVENUE
COLUMBUS, OHIO 43229
TELEPHONE (614) 848-8380

------------------------

PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
JULY 28, 1997

------------------------

INTRODUCTION

The Board of Directors and management of Bigmar, Inc. ("Bigmar" or the
"Company") is requesting your proxy for use at the Annual Meeting of
Stockholders on July 28, 1997 (the "Annual Meeting"), and at any adjournment
thereof, for the purposes set forth in the accompanying Notice of Annual Meeting
of Stockholders.

The expense of preparing, printing and mailing proxy materials to the
Company's stockholders will be borne by the Company. In addition, proxies may be
solicited personally or by telephone, mail or telegram. Officers or employees of
the Company may assist with personal or telephone solicitation and will receive
no additional compensation therefor. The Company will also reimburse brokerage
houses and other nominees for their reasonable expenses in forwarding proxy
materials to beneficial owners of the Company's common stock.

OUTSTANDING VOTING SECURITIES AND DATE OF MAILING

As of June 20, 1997, the record date for determining stockholders entitled
to notice of and to vote at the Annual Meeting, Bigmar had 3,985,000 shares of
common stock, par value $.001 per share ("Common Stock") outstanding. Each share
is entitled to one vote. Only stockholders of record at the close of business on
June 20, 1997 will be entitled to vote at the Annual Meeting. The approximate
mailing date of the Proxy Statement and the accompanying proxy card is June 26,
1997.

VOTING PROCEDURES

Stockholders may vote in person or by proxy at the Annual Meeting.

Directors will be elected by a plurality of the votes of the shares of
Common Stock present or represented by proxy at the Annual Meeting and entitled
to vote on the election of directors. Stockholders do not have cumulative voting
rights with respect to the election of directors. For all other matters to be
voted upon at the meeting, the affirmative vote of a majority of shares present
in person or represented by proxy, and entitled to vote on the matter, is
necessary for approval.

For purposes of determining the number of shares of Common Stock present in
person or represented by proxy on a voting matter, all votes cast "for,"
"against" or "abstain" are included, as are shares of Common Stock represented
by proxy where the authority to vote has been withheld.

3
<PAGE>
Stockholders may withhold authority to vote for the entire slate as
nominated or, by writing the name of one or more nominees in the space provided
in the proxy card, withhold the authority to vote for such nominee or nominees.
Shares of Common Stock as to which the authority to vote is withheld will be
counted for quorum purposes but will not be counted toward the election of
directors, or toward the election of the individual nominees specified on the
form of proxy.

Broker/dealers who hold their customers' stock in street name may, under the
applicable rules of the exchange and other self-regulatory organizations of
which the broker/dealers are members, sign and submit proxies for such stock and
may vote such stock on routine matters, which, under such rules, typically
include the election of directors, but broker/dealers may not vote such stock on
other matters, which typically include amendments to the certificate of
incorporation of the Company and the approval of stock compensation plans,
without specific instructions from the customer who owns such stock. Proxies
signed and submitted by broker/dealers which have not been voted on certain
matters as described in the previous sentence are referred to as "broker
non-votes."

All shares will be voted as specified on each properly executed proxy card.
If no choice is specified, the shares will be voted as recommended by the Board
of Directors in favor of Proposal No. 1 (i.e., "FOR" the nominees for directors
named herein), and on all other matters that properly come before the Annual
Meeting for a vote in the discretion of the person holding proxy unless
otherwise specified on the proxy card, unless authority to vote for one or more
nominees, or on a proposal, is withheld.

Proxies given may be revoked at any time by filing with the Company either a
written revocation or a duly executed proxy card bearing a later date, or by
appearing at the Annual Meeting and voting in person. Attendance at the Annual
Meeting will not, in itself, constitute revocation of the proxy.

ELECTION OF DIRECTORS
(PROPOSAL NO. 1 ON PROXY CARD)

Bigmar's Certificate of Incorporation and Bylaws provide that the number of
directors to constitute the Board of Directors shall be determined by resolution
of the Incorporator and thereafter by vote of the Board of Directors or action
of stockholders, but in no case less than one. Accordingly, effective on June
19, 1996, the date of the initial public offering of the Company (the "IPO") the
number was established at six and six directors were elected. Two of the
directors originally elected have since resigned. One of those vacancies was
filled by vote of the remaining members of the Board of Directors, electing Mr.
Morris in accordance with the Company's Bylaws. The other vacancy remains and is
proposed to be filled at the Annual Meeting by the election of Mr. Giovannini.

At the Annual Meeting, six directors will be elected to hold office for one
year and until their successors are elected at the next annual meeting and shall
have qualified. The board is nominating for re-election all of the current
directors, namely Eric M. Chen, Bernard Kramer, Michael K. Medors, John R.
Morris and John G. Tramontana and is also nominating Fabio A. Giovannini, for
election as a director. The shares of Common Stock voted by the proxies will be
voted for their election unless authority to do so is withheld as provided in
the proxy card. All nominees have consented to serve if elected. The Board of
Directors has no reason to believe that any of the nominees will not serve if
elected, but if any of the nominees become unable to serve, proxies will be
voted for any substitute nominee designated by the Board of Directors. Nominees
receiving the highest number of votes cast for the positions to be filled will
be elected. Proxies solicited by the Board of Directors will be voted for the
election of these nominees.

YOUR BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE ELECTION
OF ITS NOMINEES FOR DIRECTORS, WHICH IS DESIGNATED AS PROPOSAL NO. 1 ON THE
ENCLOSED PROXY CARD.

4
<PAGE>
INFORMATION ABOUT THE NOMINEES

The following information, as of the Record Date, with respect to the
principal occupation or employment, other affiliations and business experience
of each director during the last five years has been furnished to the Company by
each director.

NAME, AGE AND PRINCIPAL OCCUPATION OR EMPLOYMENT DURING THE PAST 5 YEARS

Eric M. Chen, 26. Director since June 1996 and a member of the Executive,
Audit, and Compensation and Stock Option Committees. Mr. Chen is Senior Vice
President of Fechtor, Detwiler & Co., Inc., an investment banking firm. From
April 1996 to August 1996 Mr. Chen was a Managing Director at LT Lawrence & Co.,
Inc. (the "Representative"). From April 1995 to April 1996 Mr. Chen was Vice
President of Fechtor, Detwiler & Co., Inc. From June 1994 to April 1995, Mr.
Chen was a research associate with Hambrecht & Quist Incorporated where he was
responsible for selected biotechnology companies. From October 1992 to June
1994, Mr. Chen was an analyst with Furman Selz Incorporated, where he worked
with a variety of companies in the media and entertainment and consumer
retailing industries. Mr. Chen received a B.A. in Biology from Harvard
University in 1992. (Pursuant to an Underwriting Agreement between the
Representative and the Company, dated June 19, 1996, for a period of five years
from the consummation of the Company's initial public offering, the
Representative may designate one representative to be a member of the Board of
Directors of the Company. The Representative initially designated Mr. Chen to be
a director of the Company.)

Fabio A. Giovannini, 39. Nominee for Director of the Company at the Annual
Meeting. Mr. Giovannini has been Marketing and Sales Director of Argor-Heraeus
SA since May 1996, a precious metals technology joint-venture between Union Bank
of Switzerland and Heraeus, Germany. From 1988 to April 1996, Mr. Giovannini was
most recently Marketing Director of Sapec SA ("Sapec") and Bigmar
Pharmaceuticals SA ("Bigmar Pharmaceuticals"), divisions of Chemholding SA
("Chemholding").

Bernard Kramer, 43. Vice President--Marketing and a director of the Company
since April 1996. Since January 1988, Mr. Kramer has worked at Bioren SA
("Bioren") where he was a manager responsible for quality control and business
development of pharmaceutical products.

Michael K. Medors, 38. Treasurer, Secretary and director of the Company
since its inception in September 1995. From 1991 to 1995, Mr. Medors was
treasurer and general manager of Cernitin America, Inc. ("Cernitin"), a cosmetic
and health products distributor. Mr. Medors and Mr. Tramontana are
brothers-in-law.

John R. Morris, 66. Director of the Company since March 1997. Mr. Morris has
been President of Biotrade Group since 1978, a worldwide brokerage company
active in pharmaceutical and fine chemical industries.

John G. Tramontana, 51. Chairman of the Board, President and Chief Executive
Officer of the Company since its inception in September 1995. From November 1989
to March 1996, Mr. Tramontana was the chief operating officer and a director of
Chemholding, a holding company for five pharmaceutical companies involved in the
development, manufacture, and commercialization of active pharmaceutical
ingredients and finished pharmaceutical products. Mr. Tramontana recently
purchased from Chemholding all of its stock in the Company, as Chemholding was
previously a principal stockholder in the Company. Mr. Tramontana had
significant responsibilities in the development, manufacture and
commercialization of products of Chemholding. Mr. Tramontana was the chief
operating officer and a director of Cerbios-Pharma SA ("Cerbios"), chairman of
the board of AB Cernelle ("Cernelle") and the president and a director of
Cernitin. In March 1996, Mr. Tramontana resigned from all of this positions with
Chemholding, Cerbios, Cernelle and Cernitin. In September 1996, following the
sale of Cernelle to an unrelated third party, Mr. Tramontana rejoined the board
of Cernelle. Mr. Tramontana and Mr. Medors are brothers-in-law.

5
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INFORMATION ABOUT EXECUTIVE OFFICERS WHO ARE NOT NOMINEES

Peter P. Stoelzle, 38. Executive Vice President of the Company since July
1996. From December 1991 to July 1996, Mr. Stoelzle worked with Bausch & Lomb
Pharmaceuticals, Inc. ("BLP"), most recently as Director, Regulatory Affairs
where he was responsible for establishing and directing all regulatory aspects
of BLP's generic drug program.

Albert Z. Hodge, 45. Vice President-Quality Assurance of the Company since
May 1996. From April 1993 to April 1996, Mr. Hodge served as Director of Quality
Compliance and Manager of Regulatory Compliance for CIBA Vision Corp. where he
was responsible for the development and implementation of ISO/GMP Quality
Systems and facility validation programs. From February 1992 to March 1993, Mr.
Hodge served as Regulatory Compliance Manager at BLP.

Philippe Rohrer, 39. Chief Financial Officer of Bioren since 1991 and of
Bigmar Pharmaceuticals since 1995. He joined Bioren in August 1991, as Finance
and Administration manager with responsibility for finance, computerization and
administration of Bioren.

DIRECTORS MEETINGS, COMPENSATION AND COMMITTEES

DIRECTOR MEETINGS

While the Board of Directors did not meet during fiscal 1996, the Board of
Directors did take eight separate actions by unanimous written consent during
fiscal 1996.

DIRECTOR COMPENSATION

Directors who are not employees of the Company receive $500 per meeting
attended as a director. Committee members receive $500 per committee meeting
attended. In addition, all directors will be reimbursed for their reasonable
out-of-pocket expenses in connection with attending meetings of the Board or any
committee thereof.

DIRECTOR OPTION PLAN

The Board of Directors has adopted a director stock option plan ("Director
Option Plan") pursuant to which directors who are not otherwise affiliated with
the Company (such as employees or consultants of the Company, or an affiliate
thereof) will receive options to purchase Common Stock. The purpose of the
Director Option Plan is to promote the overall financial objectives of the
Company and its stockholders by motivating directors to achieve long-term growth
in stockholder equity in the Company, to further align the interest of the
directors with those of the Company's stockholders and to recruit and retain the
association of these directors. The Director Option Plan provides for the award
of up to an aggregate of 50,000 shares of Common Stock and will be administered
by the Compensation and Stock Option Committee.

The Director Option Plan provides for (i) the grant, upon the consummation
of the IPO, of an option to purchase 3,000 shares of Common Stock to each
director who was not an employee or consultant of the Company and (ii) the grant
of an option to purchase 1,500 shares of Common Stock on the date of each
regular annual stockholder meeting to each participant who either is continuing
as a director subsequent to the meeting or who is elected at such meeting to
serve as a director. Options granted under the Director Option Plan must provide
for the purchase of shares of Common Stock at an exercise price of not less than
the fair market value of the Common Stock on the date of grant. No option under
the plan may be exercisable 10 years after its date of grant. Options granted
under the Director Option Plan will not be transferable by the optionee other
than by will, by the laws of descent and distribution or as required by law.

6
<PAGE>
During the fiscal year ended December 31, 1996, pursuant to the Director
Option Plan, Messrs. Chen, James M. McCormick and Thomas W. D'Alonzo were each
granted an option to purchase 3,000 shares of Common Stock at an exercise price
of $7.50. Messrs. McCormick's and D'Alonzo's options expired ninety (90) days
after their respective resignations as a director of the Company. Mr. McCormick
resigned as a director of the Company in December 1996, and Mr. D'Alonzo
resigned as a director in January 1997.

OPTION PLAN

In April 1996, the Board of Directors adopted and the stockholders approved
an option plan (the "Option Plan"). The Option Plan provides for the grant of
incentive stock options ("ISOs") (within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended) and non-qualified stock options
("NQSOs") to directors, officers and employees of the Company. The Option Plan
further provides for the grant of NQSOs to directors and agents of, and
consultants to, the Company, whether or not employees of the Company. The
purpose of the Option Plan is to attract and retain exemplary directors,
employees, agents, and consultants. All options granted under the Option Plan
are set at an exercise price of not less than the fair market value of the
Common Stock on the date of grant. All options granted under the Option Plan
will not be transferable by the optionee other than by will, by the laws of
descent and distribution or as required by law.

Options granted under the Option Plan may not be exercisable for terms in
excess of 10 years from the date of grant. In addition, no options may be
granted under the Option Plan later than 10 years after the Option Plan's
effective date. The total number of shares of Common Stock with respect to which
options will be granted under the Option Plan is 300,000. The shares subject to
and available under the Option Plan may consist, in whole or in part, of
authorized but unissued stock or treasury stock not reserved for any other
purpose. Any shares subject to an option that terminates, expires or lapses for
any reason, and any shares purchased pursuant to an option and subsequently
repurchased by the Company pursuant to the terms of the option, shall again be
available for grant under the Option Plan.

The Option Plan is administered by the Board of Directors of the Company
which determines, in its discretion, among other things, the recipients of
grants, whether a grant will consist of ISOs or NQSOs, or a combination thereof,
and the number of shares of Common Stock to be subject to such options. The
Board of Directors of the Company may, in its discretion, delegate its power,
duties and responsibilities under the Option Plan to a committee consisting of
two or more directors who are "disinterested persons" within the meaning of Rule
16b-3 promulgated under the Securities Act of 1934, as amended. The Compensation
and Stock Option Committee, which is responsible for administering the Option
Plan, is composed of Messrs. Medors, Chen and Morris.

The Option Plan contains certain limitations applicable only to ISOs granted
thereunder. To the extent that the aggregate fair market value, as of the date
of grant, of the shares to which ISOs become exercisable for the first time by
an optionee during the calendar year exceeds $100,000, the ISO will be treated
as a NQSO. In addition, if an optionee beneficially owns more than 10% of the
Common Stock at the time the individual is granted an ISO, the option price per
share cannot be less than 110% of the fair market value per share and the term
of the option cannot exceed five years.

During the fiscal year ended December 31, 1996, pursuant to the Option Plan,
Mr. Tramontana was granted an option to purchase 10,171 and 114,829 shares of
Common Stock at exercise prices of $9.83 and $8.94 respectively, Mr. Stoelzle
was granted an option to purchase 75,000 shares of Common Stock at an exercise
price of $8.94, Mr. Kramer was granted an option to purchase 25,000 shares of
Common Stock at an exercise price of $8.94, Mr. Rohrer was granted an option to
purchase 25,000 shares of Common Stock at an exercise price of $8.94, Mr. Hodge
was granted an option to purchase 15,000 shares of Common Stock at an exercise
price of $8.94, and certain other individuals were granted options to purchase
15,000 shares of Common Stock at an exercise price of $8.94.

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<PAGE>
BOARD COMMITTEES

The Board of Directors has a standing Executive Committee, Compensation and
Stock Option Committee and Audit Committee.

EXECUTIVE COMMITTEE. The Executive Committee exercises all the power and
authority of the Board of Directors in the management and affairs of the Company
between meetings of the Board of Directors, to the extent permitted by law. The
members of the Executive Committee are Messrs. Chen, Morris and Tramontana.

COMPENSATION AND STOCK OPTION COMMITTEE. The Compensation and Stock Option
Committee makes recommendations to the Board of Directors concerning
compensation, including incentive arrangements, of the Company's officers and
key employees and others and administers the Option Plan and determines the
officers, key employees and others to be granted options under the Option Plan
and the number of shares subject to such options. In addition, the Compensation
and Stock Option Committee will administer the Director Option Plan. The
Compensation and Stock Option Committee did not meet during fiscal 1996, but did
take one action by unanimous written consent. The members of the Compensation
and Stock Option Committee are Messrs. Medors, Chen and Morris. See the
Compensation and Stock Option Committee Report on Executive Compensation under
"COMPENSATION OF EXECUTIVE OFFICERS," below.

AUDIT COMMITTEE. The Audit Committee (i) reviews the accounting and
financial reporting practices of the Company and the adequacy of its system of
internal controls, (ii) reviews the scope and results of any outside audit of
the Company and the fees therefor and (iii) makes recommendations to the Board
of Directors or management concerning auditing and accounting matters and the
selection of outside auditors. The Audit Committee did not meet during fiscal
1996. The members of the Audit Committee are Messrs. Chen and Morris.

INFORMATION REGARDING SECURITY HOLDERS

The Common Stock is the Company's only outstanding class of voting
securities.

PRINCIPAL SECURITY HOLDERS

The following table sets forth beneficial ownership of Common Stock as of
June 20, 1997 by each person known by the Company to be the beneficial owner of
more than five percent of the Common Stock.

<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
NAME AND ADDRESS BENEFICIAL PERCENT OF
TITLE OF CLASS OF BENEFICIAL OWNER OWNERSHIP CLASS
- ------------------------------- ------------------------------ -------------- -----------
<S> <C> <C> <C>
Common Stock................... John G. Tramontana 2,392,031(1) 58.2%
6660 Doubletree Avenue
Columbus, Ohio 43229
</TABLE>

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(1) Includes 125,000 shares underlying options which are currently exercisable.
The Company believes that Mr. Tramontana has sole investment and voting
power with respect to the Common Stock indicated as beneficially owned by
Mr. Tramontana.

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<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT

The following table sets forth beneficial ownership of Common Stock as of
June 20, 1997 by each (i) director of the Company, (ii) each of the executive
officers included in the Summary Compensation Table (see "COMPENSATION OF
EXECUTIVE OFFICERS" below), and (iii) all directors and executive officers of
the Company as a group.

<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
NAME OF BENEFICIAL BENEFICIAL PERCENT OF
TITLE OF CLASS OWNER OWNERSHIP CLASS
- ------------------------- ------------------------------------ -------------- -----------
<S> <C> <C> <C>
Common Stock............. John G. Tramontana 2,392,031(1) 58.2%
Common Stock............. Bernard Kramer 8,334(2) *
Common Stock............. Michael K. Medors 0 *
Common Stock............. Eric M. Chen 3,000(3) *
Common Stock............. John R. Morris 0 *
Common Stock............. All directors and executive officers 2,446,699 59.3%
as a group (seven persons)
</TABLE>

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* Less than 1%

(1) Includes 125,000 shares of Common Stock underlying options currently
exercisable.

(2) Includes 8,334 shares of Common Stock underlying options currently
exercisable. Does not include 16,666 shares of Common Stock underlying
options not currently exercisable.

(3) Includes 3,000 shares of Common Stock underlying options currently
exercisable. Does not include 11,433 shares of Common Stock underlying
warrants not currently exercisable.

CHANGES IN CONTROL

Mr. Tramontana, Chairman of the Board of Directors, President and Chief
Executive Officer of the Company, pursuant to privately negotiated transactions
in Switzerland, has acquired additional shares of the Common Stock, sufficient
to obtain a controlling equity interest in the Company. Mr. Tramontana has
advised the Company that on March 27, 1997 he entered into an agreement with
each of Chemholding and four individuals to acquire for cash consideration all
shares of Common Stock owned by such persons, subject to certain conditions. The
closing conditions were satisfied on May 2, 1997. The number of shares of Common
Stock purchased and the consideration paid were as follows:

1,010,563 shares for a price equal to 0.8163766 Swiss francs (or
.555 United States dollars) per share. 283,100 shares for a price
equal to 9.3253267 Swiss francs (or 6.3394 United States dollars)
per share. (The conversion to U.S. dollars assumes an exchange
rate of 1.471 Swiss francs for every 1.00 U.S. dollar).

The source of the consideration for such purchase was private funds of Mr.
Tramontana. The aggregate number of shares of Common Stock acquired by Mr.
Tramontana was 1,293,663. The shares are restricted within the meaning of Rule
144 of the Securities and Exchange Commission (the "SEC").

Prior to the stock purchases, Mr. Tramontana beneficially owned 1,098,368
shares of Common Stock (including 125,000 shares underlying options which were
then and are currently exercisable), which comprised 26.7% of the outstanding
shares of Common Stock. Accordingly, Mr. Tramontana is now the beneficial owner
of 2,392,031 shares of Common Stock (including the 125,000 option shares), or
approximately 58.2% of the total outstanding, and may therefore be deemed to
control the Company. Prior to such transactions no single person or group owned
a controlling equity interest in Company.

The Company is not aware of any arrangements, the operation of which may at
a subsequent date result in a change of control of the Company.

9
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Ownership of and transactions in the Common Stock by executive officers,
directors and persons who own more than 10% of the Common Stock are required to
be reported to the SEC pursuant to Section 16 of the Securities Exchange Act of
1934. Based solely on a review of the copies of reports furnished to the Company
and representations of certain executive officers and directors, the Company
believes that during fiscal 1996 its officers, directors and greater than 10%
beneficial owners complied with such filing requirements.

COMPENSATION OF EXECUTIVE OFFICERS

The following table sets forth information regarding compensation paid by
the Company since its inception to its Chief Executive Officer and the other
most highly compensated executive officers whose annual compensation exceeded
$100,000 for the fiscal year ended December 31, 1996 (the "Named Executives"):

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
------------
ANNUAL COMPENSATION SECURITIES
------------------------ UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS COMPENSATION(1)
- --------------------------------- ---- ---------- --------- ------------ -------------------
<S> <C> <C> <C> <C> <C>
John G. Tramontana............... 1996 $ 102,650 $ 25,000 12$5,000 $ 3,000
Chairman of the Board of
Directors, Chief Executive
Officer
</TABLE>

- ------------------------

(1) Amounts relate to annual auto allowance.

OPTION GRANTS IN FISCAL 1996

<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE
INDIVIDUAL GRANTS VALUE AT
----------------------------------------------------- ASSUMED ANNUAL
PERCENT OF RATE OF STOCK
NUMBER OF TOTAL PRICE
SECURITIES OPTIONS EXERCISE APPRECIATION
UNDERLYING GRANTED TO PRICE FOR OPTION TERM
OPTIONS EMPLOYEES IN ($ PER EXPIRATION ---------------
NAME GRANTED(1) FISCAL 1996 SHARE) DATE 5% 10%
- --------------------------- ----------- ------------ ----------- ---------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
John G. Tramontana......... 114,829(2) 4.0% $ 8.94 8/20/01 $283,623 $626,732
10,171(3) 3.6% $ 9.83 8/20/01 $27,623 $61,039
</TABLE>

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(1) Underlying Option Amounts are stated in terms of Common Stock.

(2) Non-qualified Stock Option.

(3) Incentive Stock Option.

FISCAL 1996 OPTION EXERCISES AND FISCAL YEAR END OPTION VALUES

No options were exercised during the fiscal year ended December 31, 1996.
The Company has no outstanding stock appreciation rights.

<TABLE>
<CAPTION>
NUMBER OF
SECURITIES
UNDERLYING
UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS
SHARERS FY-END AT FY-END
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE REALIZED UNEXERCISABLE UNEXERCISABLE
- --------------------------- ------------ ------------ ---------------- --------------------
<S> <C> <C> <C> <C>
John G. Tramontana......... -- -- 125,000/None $ 0/$0
</TABLE>

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<PAGE>
EMPLOYMENT AGREEMENT WITH JOHN G. TRAMONTANA

In April 1996, the Company entered into an employment agreement with Mr.
Tramontana to serve as the Company's President and Chief Executive Officer. The
employment agreement is for a five-year term commencing June 19, 1996 and is
subject to automatic annual renewal unless earlier terminated. Pursuant to the
terms of this employment agreement, Mr. Tramontana is required to devote his
full business time and attention to fulfill his duties and responsibilities to
the Company. Mr. Tramontana will receive a base salary of $200,000 for the first
year of the term of the employment agreement with subsequent annual cost of
living increases at the discretion of the Company's Board of Directors. In
addition to his base salary, Mr. Tramontana is entitled to receive an annual
bonus, at the discretion of the Board of Directors, provided such bonus is equal
to at least 25% of his base salary. Mr. Tramontana's employment agreement
provides that the Company is required to provide Mr. Tramontana with an
automobile allowance of $6,000 per annum and the Company is required to obtain
life insurance coverage on the life and for the benefit of Mr. Tramontana in an
amount equal to $500,000, assuming he is insurable. Mr. Tramontana will also
have the right to participate in all benefit plans afforded or which may be
afforded to other executive officers during the term of the agreement including,
without limitation, group insurance, health, hospital, dental, major medical,
life and disability insurance, stock option plans and other similar fringe
benefits. If Mr. Tramontana dies or is unable to perform his duties on account
of illness or other incapacity and the agreement is terminated, he or his legal
representative shall receive from the Company the base salary which would
otherwise be due to the end of the month during which the termination of
employment occurred plus three additional months of base salary in the event of
death and six additional months of base salary in the event of illness or other
incapacity. The agreement further provides that if the Company terminates Mr.
Tramontana's employment for cause or if Mr. Tramontana voluntarily leaves the
employment of the Company, Mr. Tramontana shall receive his salary through the
end of the month in which the termination occurred. If Mr. Tramontana's
employment is terminated by the Company without cause, Mr. Tramontana shall
receive from the Company the base salary which would otherwise be due to the end
of the month during which the termination of employment occurred plus four
additional months. Mr. Tramontana's employment agreement contains certain
confidentiality and non-competition provisions. The Company has obtained
$2,000,000 of key-person life insurance for the benefit of the Company on the
life of Mr. Tramontana. During the second quarter of 1997, Mr. Tramontana will
be paid the minimum bonus of 25% of his base salary.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During fiscal 1996, Michael K. Medors, Treasurer and Secretary of the
Company, served as a member of the Compensation and Stock Option Committee of
the Board of Directors. In addition, in March 1996, the Company entered into a
sublease agreement with Cernitin. The sublease was month to month and the
Company has now terminated the lease as of May 31, 1997. The sublease was at a
rental of approximately $22,315 per annum. Mr. Tramontana was the President and
a director of Cernitin and Mr. Medors was the treasurer and general manager of
Cernitin at the time of the negotiation and execution of the sublease.
Furthermore, in December 1996, the Company entered into the Lease with JTech
Laboratories, Inc. ("JTech"). The Lease commences on the completion of
construction of an approximately 8,600 square foot office and laboratory
facility. The Lease provides for a rental of approximately $120,000 per annum
with the first year's rent due in full at the time of commencement of the Lease
discounted at 9%. Mr. Tramontana was the President and director of JTech and Mr.
Medors was the Treasurer and director of JTech at the time of the negotiation
and execution of the Lease. Mr. Tramontana and Mr. Medors continue to hold such
positions with JTech.

During fiscal 1996, Eric M. Chen served as a member of the Compensation and
Stock Option Committee of the Board of Directors. In June 1996, the Company
granted to the Representative an option to purchase 140,000 shares of Common
Stock at an exercise price per share equal to $9.75. In 1996, the

11
<PAGE>
Representative assigned to Mr. Chen warrants to purchase 11,433 shares of Common
Stock at an exercise price equal to $9.75.

REPORT OF THE COMPENSATION AND STOCK OPTION COMMITTEE

While the Compensation and Stock Option Committee of the Board of Directors
(the "Compensation Committee") did not meet during fiscal 1996, it did act by
unanimous written consent on one occasion. The salaries of the executive
officers have not increased since the Company's IPO, as the Compensation
Committee has not yet finalized formal compensation policies applicable to the
Company's executive officers.

The Compensation Committee believes that the Company should create
compensation packages to attract and retain executives who can bring the
experience and skills to the Company necessary for the development of the
Company and its products. The Compensation Committee intends that this will be
accomplished by utilizing salary as the base compensation and stock options to
promote long-term incentives. As the Company grows, other forms of annual and
long-term compensation arrangements may be developed to provide appropriate
incentives and to reward specific accomplishments.

In determining base salaries, the Compensation Committee intends to examine,
among other factors, the executive's performance, degree of responsibility and
experience, as well as general employment conditions and economic factors. It is
not anticipated that specific weights will be assigned to any of the factors
employed by the Compensation Committee.

The Compensation Committee also intends to use stock options to provide
long-term incentive compensation to the Company's employees, including executive
officers, enabling them to benefit, along with all stockholders, if the market
price for Common Stock rises. The Compensation Committee believes that the use
of stock options ties employee interests to those of the Company's stockholders
through stock ownership and potential stock ownership, while also providing the
Company with a means of compensating employees using a method which enables the
Company to conserve its available cash for operations and product development.
Decisions of the Compensation Committee as to option grants will be based, in
large measure, upon a review of such factors as the executive's level of
responsibility, other compensation, accomplishments and goals, as well as
recommendations and evaluations of the executive's performance. Determinations
will be made subjectively without giving weight to specific factors.

The salary of John G. Tramontana, the Company's President and Chief
Executive Officer has remained unchanged since the Company's IPO, although
during fiscal 1996 he was granted options to purchase shares of the Company's
Common Stock in recognition of his efforts on behalf of the Company.

Section 162(m) of the Internal Revenue Code places certain restrictions on
the amount of compensation in excess of $1,000,000 which may be deducted for
each executive officer. The Company intends to satisfy the requirements of
Section 162(m) should the need arise.

<TABLE>
<CAPTION>
<S> <C>
Respectfully submitted,

Eric M. Chen
Michael K. Medors
John R. Morris
</TABLE>

12
<PAGE>
PERFORMANCE GRAPH

The following line graph compares the Company's cumulative total stockholder
return against the cumulative return of the S&P 500 Index and the NASDAQ
Pharmaceutical Index for the period from June 20, 1996, to December 31, 1996.
The comparison assumes $100 was invested on June 20, 1996 in the Company's
Common Stock and in each of the foregoing indices and assumes reinvestment of
dividends.

COMPARISON OF 6 MONTH CUMULATIVE TOTAL RETURN
AMONG BIGMAR, INC., THE S & P 500 INDEX
AND THE NASDAQ PHARMACEUTICAL INDEX

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
BIGMAR, INC. S & P 500 NASDAQ PHARMACEUTICAL
<S> <C> <C> <C>
6/20/96 $100 $100 $100
12/31/96 86 113 99
</TABLE>

13
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

TRANSACTIONS WITH PRINCIPAL STOCKHOLDERS

In November 1995, Bioren entered into the Sapec Exclusive Distribution
Agreement (the "Sapec Agreement") and Bigmar Pharmaceuticals entered into an
agreement (the "Cernelle Agreement") pursuant to which Bigmar Pharmaceuticals
obtained the exclusive worldwide distribution rights to approximately 20 generic
oncological products including calcium leucovorin, methotrexate and
mercaptopurine manufactured by Cernelle. Pursuant to the terms of the Sapec
Agreement, Bioren paid Sapec a one-time fee of $100,000 upon notification by
Sapec that its oncological products were ready for shipment. In addition, in
November 1995, Bigmar Pharmaceuticals entered into the Bioferment License and
Supply Agreement (the "Bioferment Agreement"). Pursuant to the terms of the
Bioferment Agreement, Bigmar Pharmaceuticals paid Bioferment SA ("Bioferment")
$100,000. At the time of negotiation and execution of the foregoing agreements,
Mr. Tramontana, the Company's Chairman of the Board, President, and Chief
Executive Officer, was the Chief Operating Officer and a director of Cerbios,
Chairman of the Board of Cernelle and a director of Chemholding, then a
principal stockholder of the Company. Chemholding is the sole stockholder of
Cerbios of which Sapec and Bioferment are divisions. Until July 1996, Cerbios
was the sole stockholder of Cernelle. Certain stockholders of the Company own in
the aggregate approximately 80% of the capital stock of Chemholding. Mr.
Tramontana is not a stockholder of Chemholding, Cerbios or Cernelle. On March
27, 1997, the Company reached a settlement (the "Settlement") with Cerbios of
claims made by Cerbios that the Company owed Cerbios $2,243,000 for various
"services" and "values of lost contracts," and as a result of the Settlement
terminated the contracts it had entered into with Sapec and Bioferment. In July
1996, Cernelle was sold to an unrelated third party. The Company's agreement
with Cernelle has not been terminated. Mr. Tramontana rejoined the board of
directors of Cernelle in September 1996.

In 1995, Unione Farmaceutica SA ("Unione Farmaceutica"), which is owned by
certain stockholders of the Company, loaned $1,809,524 to the Company bearing
interest at the rate of 9% per annum. The principal on the loan was repaid in
August 1996. For the fiscal year ended December 31, 1995, the Company made
interest payments to Unione Farmaceutica in the amount of $151,000. For the
fiscal year ended December 31, 1996, the Company made interest payments to
Unione Farmaceutica in the amount of $96,373.

On January 8, 1995, Chemholding agreed to be a surety for Bigmar
Pharmaceuticals in the amount of $1.3 million for the loans with respect to the
Bigmar's state of the art facility in Switzerland.

For the fiscal year ended December 31, 1995, the Company purchased inventory
from Cernelle and Cerbios in the aggregate amount of $206,000 and paid selling,
general and administrative expenses and freight charges to Cerbios in the amount
of $169,000. For the fiscal year ended December 31, 1996, such purchases
aggregated $965,000 and the fee accrued for Cerbios in connection with the
Settlement aggregated approximately $300,000.

In June 1995, all of the outstanding capital stock of Bioren was purchased
by Bigmar Pharmaceuticals, for an aggregate purchase price of approximately $9.4
million, consisting of approximately $5.2 million in cash and the assumption of
certain of the Bioren's liabilities in the aggregate principal amount of $4.2
million. In addition, in connection with the purchase by Bigmar Pharmaceuticals
of all of the outstanding capital stock of Bioren (the "Bioren Acquisition"),
Bigmar Pharmaceuticals became a guarantor on a bank loan to Bioren in the
principal amount of $2.6 million, which was collateralized by a facility used by
Bioren (the "Bioren Facility"), and provided a guarantee on a second mortgage in
the aggregate principal amount of approximately $1.7 million on the Bioren
Facility. In addition, simultaneous with the Bioren Acquisition, in June 1995,
Bigmar Pharmaceuticals sold one-half of its equity interest in Bioren to certain
Bigmar Pharmaceuticals' stockholders to whom Bigmar Pharmaceuticals sold
one-half of its equity interest in Bioren (the "Bioren Holders") for
approximately $2.6 million. This sale included 500 shares (10% of

14
<PAGE>
Bioren's outstanding stock) to Mr. Tramontana, the Company's Chairman of the
Board, President and Chief Executive Officer, for approximately $500,000.

In September 1995, the Company sold an aggregate of 2,375,000 shares of
Common Stock to its existing stockholders prior to the IPO and on April 8, 1996
such existing stockholders contributed 99% of these shares of Common Stock to
the Company. On April 9, 1996, the Bioren Holders exchanged their capital stock
in Bioren (representing 50% of the outstanding Bioren capital stock) for 350,312
shares of the Common Stock of the Company with an approximate fair market value
(based on the IPO price of $7.50 per share) of $2,627,340 and the stockholders
of Bigmar Pharmaceuticals exchanged all of the capital stock of Bigmar
Pharmaceuticals for 2,000,938 shares of Common Stock of the Company with an
approximate fair market value (based on the IPO price of $7.50 per share) of
$15,007,035.

TRANSACTIONS WITH DIRECTORS AND EXECUTIVE OFFICERS

In March 1996, the Company entered into a sublease agreement with Cernitin.
The sublease was month to month and the Company has now terminated the lease as
of May 31, 1997. The sublease was at a rental of approximately $22,315 per
annum. Mr. Tramontana was the President and a director of Cernitin and Mr.
Medors was the treasurer and general manager of Cernitin at the time of the
negotiation and execution of the sublease.

In April 1996, Mr. Tramontana entered into five-year employment agreement
with the Company. In August 1996, pursuant to the Option Plan, Mr. Tramontana
was granted an option to purchase 10,171 and 114,829 shares of Common Stock at
exercise prices of $9.83 and $8.94 respectively. In addition, the Company
granted options to certain directors and officers of the Company. See
"COMPENSATION OF EXECUTIVE OFFICERS" above.

In June 1996, the Company granted to the Representative an option to
purchase 140,000 shares of Common Stock at an exercise price per share equal to
$9.75. In 1996 the Representative assigned to Mr. Chen warrants to purchase
11,433 shares of Common Stock at an exercise price equal to $9.75.

In December 1996, the Company entered into the Lease with JTech. The Lease
commences on the completion of construction of an approximately 8,600 square
foot office and laboratory facility. The Lease provides for a rental of
approximately $120,000 per annum with the first year's rent due in full at the
time of commencement of the Lease discounted at 9%. Mr. Tramontana was the
President and director of JTech and Mr. Medors was the Treasurer and director of
JTech at the time of the negotiation and execution of the Lease. Mr. Tramontana
and Mr. Medors continue to hold such positions with JTech.

Mr. Tramontana and Chemholding may be deemed to be founders or promoters of
the Company as that term is defined under the Securities Act of 1933, as
amended.

Certain of the transactions set forth above have been entered into by the
Company with certain persons who, at the time of such transactions, might have
been deemed control persons or affiliates of the Company. Notwithstanding the
foregoing, the Company believes that the terms of these transactions are no less
favorable to the Company than it would have obtained from unaffiliated third
parties. The Company anticipates that all future transactions and loans between
the Company and its officers, directors, 5% stockholders and affiliates will be
on terms no less favorable than could be obtained from unaffiliated third
parties and that such transactions and loans will be approved by a majority of
the independent disinterested directors of the Company. There can be no
assurance that the Company will be able to negotiate future transactions and
loans on favorable terms to the Company or at all.

INDEPENDENT AUDITORS

Richard A. Eisner & Company, LLP has been the independent accounting firm
for the Company since 1996. Representatives of Richard A. Eisner & Company, LLP
are expected to be present at the

15
<PAGE>
Annual Meeting and will be given an opportunity to comment, if they so desire,
and to respond to appropriate questions that may be asked by stockholders.

As of the date of this Proxy Statement, the Company has not made a
determination regarding selection of independent auditors for the fiscal year
ending December 31, 1997.

OTHER MATTERS

The Board of Directors knows of no other matters which will be presented at
the Annual Meeting, but if any other matters do properly come before the Annual
Meeting, including adjournment, they would require, unless otherwise stated, the
affirmative vote of a majority of shares voting. If any other matters come
before the Annual Meeting or any adjournment, each proxy will be voted in the
discretion of the individuals named as proxies on the proxy card in their
discretion.

STOCKHOLDER PROPOSALS

Stockholders who desire to have proposals included in the notice for the
annual meeting of stockholders of the Company to be held in 1998 must submit
their proposals in writing to the Company, Attention: Secretary, at its offices
on or before February 20, 1998.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

ANNUAL REPORT

Bigmar's Annual Report on Form 10-K for the year ended December 31, 1996 is
incorporated by reference herein. A copy of that report is included with these
proxy materials.