ALTAREX CORP, 6-K, 2000-04-20

ALTAREX CORP
6-K, 2000-04-20
PHARMACEUTICAL PREPARATIONS

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<PAGE> 1

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16a, 15d-16
OF THE SECURITIES EXCHANGE ACT OF 1934

For the Month of April, 2000

ALTAREX CORP.
(Exact name of Registrant as specified in its charter)

CAMPUS TOWER
#300, 8625 - 112 STREET
EDMONTON, ALBERTA, CANADA T6G 1K8
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.

Form 20-F X Form 40-F
---- ----

Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes No X
---- ----

INDEX TO EXHIBITS
<TABLE>
<CAPTION>

EXHIBIT NO. DESCRIPTION
- ----------- -----------
<S> <C>
99.1 Notice of Annual and Special Meeting of Shareholders and Management Information
Circular March 27, 2000

99.2 Proxy Solicited by Management for Annual and Special Meeting of Shareholders to be
held on May 3, 2000
</TABLE>

<PAGE> 2

Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

ALTAREX CORP.

By: /s/ Edward M. Fitzgerald
----------------------------------------

Name: Edward M. Fitzgerald

Title: Senior Vice President and
Chief Financial Officer

Date: April 20, 2000

-2-

<PAGE> 1
Exhibit 99.1

[LOGO]

ALTAREX CORP.

NOTICE OF ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS

AND

MANAGEMENT INFORMATION CIRCULAR

March 27, 2000

<PAGE> 2

[LOGO]
ALTAREX CORP.

REGISTERED OFFICE: EXECUTIVE OFFICE:
CAMPUS TOWER, SUITE 300 SUITE 125, 303 WYMAN STREET
8625 - 112 STREET WALTHAM, MASSACHUSETTS
EDMONTON, ALBERTA T6G 2E1 02451

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

NOTICE OF ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS

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

NOTICE IS HEREBY GIVEN that the annual and special meeting (the "Meeting")
of holders of common shares ("Shareholders") of AltaRex Corp. (the
"Corporation") will be held at the Royal Meridian King Edward Hotel, 37 King
Street East, Toronto, Ontario on May 3, 2000 at 3:00 p.m. (Toronto time), for
the following purposes:

1. to receive the annual report of the directors to the shareholders and the
financial statements of the Corporation for the year ended December 31,
1999 and the auditors' report thereon;

2. to elect directors;

3. to appoint Arthur Andersen LLP, Chartered Accountants, as auditors of the
Corporation and to authorize the directors to fix their remuneration;

4. to consider and, if deemed advisable, pass, with or without variation, a
resolution approving an amendment to the stock option plan of the
Corporation (the "Plan") increasing the number of Common Shares reserved
for issuance thereunder from 4,180,000 to 11,500,000, the full text of
which is set out in Schedule "A" to the accompanying Management Information
Circular of the Corporation (the "Circular"), all as more particularly
described in the Circular;

5. to consider and, if deemed advisable, pass, with or without variation, a
special resolution approving an amendment to the articles of the
Corporation to consolidate all issued and outstanding Common Shares on the
basis of one (1) post-consolidation Common Share for every four (4)
pre-consolidation Common Shares at the discretion of the Board of Directors
at any time prior to the next meeting of shareholders, the full text of
which is set out in Schedule "B" to the Circular, all as more particularly
described in the Circular; and

6. to consider such other matters as may properly come before the Meeting or
any adjournment thereof.

<PAGE> 3

The Board of Directors of the Corporation has fixed the close of business
on March 29, 2000 as the record date (the "Record Date") for the purpose of
determining Shareholders entitled to receive notice of the Meeting, but the
failure of any Shareholder to receive notice of the Meeting does not deprive
such Shareholder of the right to vote at the Meeting. If a person has acquired
Common Shares of the Corporation after the Record Date, that person is entitled
to vote those shares at the Meeting upon establishing share ownership and
demanding the inclusion of his or her name on the list of shareholders of the
Corporation not later than ten days before the date of the Meeting.

By Order of the Board of Directors

(Signed) EDWARD M. FITZGERALD
Senior Vice President,
Chief Financial Officer and Secretary

Waltham, Massachusetts
March 27, 2000

SHAREHOLDERS WHO ARE UNABLE TO BE PRESENT AT THE MEETING ARE REQUESTED TO
COMPLETE AND RETURN THE ENCLOSED FORM OF PROXY IN THE ENVELOPE PROVIDED FOR THAT
PURPOSE. THE BOARD OF DIRECTORS HAS SPECIFIED THAT PROXIES MUST BE RECEIVED AT
THE CALGARY OFFICE OF THE CORPORATION'S TRANSFER AGENT, MONTREAL TRUST COMPANY
OF CANADA, BEFORE 5:00 P.M. (CALGARY TIME), ON THE LAST BUSINESS DAY PRIOR TO
THE MEETING OR, IF SUCH MEETING IS ADJOURNED, SUCH TIME ON THE BUSINESS DAY
IMMEDIATELY PRIOR TO THE DATE TO WHICH SUCH MEETING IS ADJOURNED AT THE
FOLLOWING ADDRESS, OR MAY BE DEPOSITED WITH THE CHAIRMAN OF THE MEETING PRIOR TO
THE COMMENCEMENT THEREOF:

ALTAREX CORP.
C/O MONTREAL TRUST COMPANY OF CANADA
SUITE 600
530 - 8TH AVENUE S.W.
CALGARY, ALBERTA T2P 3S8

<PAGE> 4

ALTAREX CORP.

ANNUAL AND SPECIAL MEETING
OF SHAREHOLDERS
TO BE HELD ON MAY 3, 2000

MANAGEMENT INFORMATION CIRCULAR

This Management Information Circular ("Circular") is furnished in
connection with the solicitation of proxies by the management of AltaRex Corp.
(the "Corporation") for use at the Annual and Special Meeting of the holders
(the "Shareholders") of common shares (the "Common Shares") of the Corporation
to be held at the Royal Meridian King Edward Hotel, 37 King Street East,
Toronto, Ontario, at 3:00 p.m. (Toronto time) on May 3, 2000 (the "Meeting"),
for the purposes set forth in the notice of meeting which accompanies this
Circular. The information contained herein is given as of March 27, 2000, except
where otherwise indicated. There is enclosed herewith a form of proxy for use at
the Meeting. Each Shareholder who is entitled to attend at meetings of
Shareholders is encouraged to participate in the Meeting and Shareholders are
urged to vote on matters to be considered in person or by proxy.

APPOINTMENT AND REVOCATION OF PROXIES

Those Shareholders desiring to be represented by proxy must deposit their
respective forms of proxy with Montreal Trust Company of Canada ("Montreal
Trust"), Attention: Corporate Trust Department, 6th Floor, 530 - 8th Avenue
S.W., Calgary, Alberta T2P 3S8 by no later than 5:00 p.m. (Calgary time) on the
last business day preceding the date of the Meeting, or any adjournment thereof.
A proxy must be executed by the Shareholder or by his attorney authorized in
writing, or if the Shareholder is a corporation, under its seal or by an officer
or attorney thereof duly authorized. A proxy is valid only at the Meeting in
respect of which it is given or any adjournment of the Meeting.

The persons named in the enclosed form of proxy are directors and/or
officers of the Corporation and will represent management of the Corporation at
the Meeting. EACH SHAREHOLDER SUBMITTING A PROXY HAS THE RIGHT TO APPOINT A
PERSON TO REPRESENT HIM, HER OR IT AT THE MEETING OTHER THAN THE PERSONS
DESIGNATED IN THE FORM OF PROXY FURNISHED BY THE CORPORATION. The Shareholder
may exercise this right by striking out the names of the persons so designated
and inserting the name of the desired representative in the blank space
provided, and depositing the proxy with Montreal Trust at the place and within
the time specified above for the deposit of proxies.

An instrument of proxy may be revoked by the person giving it at any time
prior to the exercise thereof. IF A PERSON WHO HAS GIVEN A PROXY ATTENDS
PERSONALLY AT THE MEETING AT WHICH SUCH PROXY IS TO BE VOTED, SUCH PERSON MAY
REVOKE THE PROXY AND VOTE IN PERSON. In addition to revocation in any other
manner permitted by law, a proxy may be revoked by instrument in writing
executed by the Shareholder or his or her attorney duly authorized in writing,
or if the Shareholder is a corporation, under its seal or by an officer or
attorney thereof duly authorized, and deposited either with Montreal Trust at
any time up to and including 5:00 p.m. (Calgary time) on the last business day
preceding the Meeting or any adjournment thereof, at which the proxy is to be
used, or with the Chairman of the Meeting, on the day of the Meeting or any
adjourned meeting prior to the commencement thereof. Such revocation shall be
deemed effective upon such deposit in either manner.

EXERCISE OF DISCRETION

The Common Shares represented by properly executed proxies designated in
the printed portion of the accompanying form of proxy will be voted or withheld
from voting on any ballot that may be called for, and, where the Shareholder
specifies a choice with respect to any matter to be acted upon, such Common
Shares will be voted in accordance with any specification so made. THE PERSONS
APPOINTED UNDER THE ENCLOSED FORM OF PROXY ARE CONFERRED WITH DISCRETIONARY
AUTHORITY WITH RESPECT TO AMENDMENTS OR VARIATIONS OF THOSE MATTERS SPECIFIED IN
THE PROXY AND WITH RESPECT TO ANY OTHER MATTERS WHICH MAY PROPERLY BE BROUGHT
BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF IN ACCORDANCE WITH THEIR BEST
JUDGEMENT. AS AT THE DATE OF THIS CIRCULAR, THE MANAGEMENT OF THE CORPORATION
KNOW OF NO SUCH AMENDMENT, VARIATION, OR OTHER MATTER.

UNLESS OTHERWISE SPECIFIED, PROXIES IN THE ACCOMPANYING FORM WILL BE VOTED
IN FAVOUR OF: (a) THE ELECTION OF THE NOMINEES, HEREINAFTER SET FORTH, AS
DIRECTORS OF THE CORPORATION; (b) THE APPOINTMENT OF

1
<PAGE> 5

ARTHUR ANDERSEN LLP, CHARTERED ACCOUNTANTS, AS AUDITORS OF THE CORPORATION;
(c) THE RESOLUTION APPROVING AN AMENDMENT TO THE STOCK OPTION PLAN OF THE
CORPORATION (THE "PLAN") INCREASING THE NUMBER OF COMMON SHARES RESERVED FOR
ISSUANCE THEREUNDER, THE FULL TEXT OF WHICH IS SET OUT IN SCHEDULE "A" HERETO;
AND (d) THE SPECIAL RESOLUTION APPROVING AN AMENDMENT TO THE ARTICLES OF THE
CORPORATION TO CONSOLIDATE ALL ISSUED AND OUTSTANDING COMMON SHARES ON THE BASIS
OF ONE (1) POST-CONSOLIDATION COMMON SHARE FOR EVERY FOUR (4) PRE-CONSOLIDATION
COMMON SHARES, THE FULL TEXT OF WHICH IS SET OUT IN SCHEDULE "B" HERETO.

QUORUM AND VOTING

Shareholders present in person or represented by proxy representing not
less than 10% of the outstanding Common Shares are necessary to provide a quorum
at the Meeting. Voting at the Meeting will be by a show of hands, each
Shareholder having one vote, unless a poll is requested or required, in which
each Shareholder is entitled to one vote for each share held. Unless otherwise
indicated herein, in order to approve a resolution proposed at the Meeting a
majority of greater than 50% of the votes cast will be required.

PERSONS MAKING THE SOLICITATION

This solicitation is made on behalf of the management of the Corporation.
The cost incurred in the preparation and mailing of this Circular and the
accompanying proxy will be borne by the Corporation. In addition to the use of
mail, proxies may be solicited by personal delivery, telephone or any form of
electronic communication or by directors, officers and employees of the
Corporation who will not be directly compensated therefor.

RECORD DATE

The Board of Directors has fixed the close of business on March 29, 2000 as
the record date (the "Record Date") for the purpose of determining Shareholders
entitled to receive notice of the Meeting. The failure of any Shareholder to
receive notice of the Meeting does not deprive such Shareholder of the right to
vote at the Meeting. If a person has acquired Common Shares after the Record
Date, that person is entitled to vote those Common Shares at the Meeting upon
establishing ownership of the Common Shares and demanding the inclusion of his,
her or its name on the list of holders of Common Shares maintained by the
Corporation not later than ten days before the date of the Meeting.

PRINCIPAL HOLDERS OF VOTING SECURITIES

As at March 27, 2000, the Corporation had outstanding 57,621,362 Common
Shares. The following table sets forth the particulars, as at the date of this
Circular, with respect to those persons who, to the knowledge of the directors
or officers of the Corporation, beneficially own or exercise control or
direction over more than 10% of the Common Shares (being the only class of
shares of the Corporation outstanding):

NUMBER OF PERCENTAGE OF
NAME COMMON SHARES COMMON SHARES
- ---- ------------- -------------
Purdue Pharma L.P.(1)..... 10,000,000 17.4

- ----------------
Notes:

(1) Shares are owned by Banela Corporation and East Hudson Inc., affiliates of
Purdue Pharma L.P.

As of the date hereof, to the knowledge of the directors and officers of
the Corporation, there are no other persons who are holders of record or are
beneficial owners, directly or indirectly, of shares conferring over 10% of the
voting rights attached to the issued and outstanding Common Shares.

Except as disclosed above, as at the date hereof, the current directors and
officers of the Corporation as a group own directly or indirectly or exercise
control or direction over a total of 6,566,000 Common Shares representing
approximately 11.4% of the issued and outstanding Common Shares.

2
<PAGE> 6

PARTICULARS OF MATTERS TO BE ACTED UPON

ELECTION OF DIRECTORS

At the Meeting, it is proposed that six directors be elected and hold
office until the next annual meeting of Shareholders or until their successors
are elected or appointed. There are currently six directors of the Corporation.
In accordance with the Business Corporations Act (Alberta) and pursuant to the
by-laws of the Corporation, the current directors of the Corporation cease to
hold office at the close of the Meeting.

The following table sets forth, in respect of each nominee, all positions
currently held with the Corporation, principal occupation or employment within
the preceding five years, and the approximate number of Common Shares of the
Corporation beneficially owned, directly or indirectly, or over which voting
control is exercised as of March 27, 2000. The information contained below is
based upon information furnished by the respective nominee and by the
Corporation, other than the information provided below with respect to the
Common Shares which was provided to the Corporation by the respective nominee.

Management does not anticipate that any of the nominees for election as
directors will be unable to serve as a director, but if that should occur for
any reason prior to the Meeting, the persons named in the enclosed form of proxy
reserve the right to vote for another nominee in their discretion. Each director
elected will hold office until the next annual meeting of shareholders or until
such person's successor is elected or appointed, unless such person's office is
earlier vacated.

Each of the nominees is currently a director of the Corporation.

DR. ANTOINE A. NOUJAIM Chairman of the Board of Directors and Chief 5,200,000
Edmonton, Alberta Scientific Officer. President and Chief Executive
December 1, 1995 Officer of the Corporation since November 1995 to
February 22, 1998; President of Biomira Research
Inc., from 1994 to 1995; Senior Vice President of
the Immunoconjugate Division of Biomira Inc. from
1989 to 1994; Director of Biomira Inc. from 1985 to
1995; Professor Emeritus, University of Alberta;
Director, SYNSORB Biotech Inc.

RICHARD E. BAGLEY President, Chief Executive Officer and Director of 775,000
Weston, Massachusetts the Corporation since February 23, 1998. Chairman
February 23, 1998 and Chief Executive Officer of ProScript Inc. from
September, 1995 to February, 1998.
President and Chief Executive Officer
of ImmuLogic Pharmaceutical Corporation
from 1990 to 1994.

WILLIAM R. MCMAHAN Director of the Corporation. President of Oxbow Nil
Calgary, Alberta Capital Corporation and Oxbox Investments Inc.
July 15, 1996 from October, 1993 to present; Director of
International Marketing, Oxbow
Resources Limited from January, 1992 to
October, 1993; Chief Operating Officer
and Director of Oxbow Equities Corp., a
mutual fund company listed on The
Toronto Stock Exchange.

THE HONOURABLE MONIQUE BEGIN Director of the Corporation. Professor Emeritus, Nil
Ottawa, Ontario University of Ottawa. Dean, Faculty of Health
May 14, 1998 Sciences, University of Ottawa from 1990 to 1997.
Minister of National Health and Welfare
for the Government of Canada from
September 1977 to September 1984.
</TABLE>

<PAGE> 7

NUMBER OF COMMON
SHARES OWNED
BENEFICIALLY OR
NAME, MUNICIPALITY OF RESIDENCE OFFICE OR POSITION IN THE CORPORATION, IF ANY, AND SUBJECT TO CONTROL
AND DIRECTOR SINCE PRINCIPAL OCCUPATION WITHIN THE LAST FIVE YEARS OR DIRECTION
- ------------------------------- -------------------------------------------------- ------------------
<S> <C> <C>
DR. JIM A. WRIGHT ....... Director of the Corporation. President, Chief Nil
Toronto, Ontario Scientific Officer and Director of Lorus Therapeutics
May 14, 1998 Inc. since October 1999. Previously, founding
Chairman, President and Chief Scientific
Officer of GeneSense Technologies Inc.
Since 1987, Terry Fox Senior Research
Scientist of the National Cancer
Institute of Canada; Associate Director,
Manitoba Institute of Cell Biology;
Professor of Microbiology, Biochemistry
and Molecular Biology at the University
of Manitoba; Professor of Medical
Biophysics, Faculty of Medicine at the
University of Toronto.

NORMAND BALTHAZARD ...... Director of the Corporation; President and Chief 300,000
Montreal, Quebec Executive Officer, BioCapital Investments, Limited
December 22, 1999 Partnership
</TABLE>

The Corporation is required, pursuant to the Business Corporations Act
(Alberta), to appoint annually from among its members an audit committee
comprised of not less than three members. At present the Audit Committee
consists of Normand Balthazard, The Honourable Monique Begin and William R.
McMahan.

APPOINTMENT OF AUDITORS

It is proposed that Arthur Andersen LLP, Chartered Accountants be appointed
as the auditors of the Corporation to hold office until the next annual meeting
of Shareholders at a remuneration to be fixed by the Board of Directors of the
Corporation. Arthur Andersen was initially appointed as auditor of the
Corporation on September 3, 1999 upon the resignation of Ernst & Young LLP, the
previous auditors of the Corporation. A reporting package with respect to the
change of auditors is attached to the Circular as required by National Policy 31
of the Canadian Securities Administrators.

AMENDMENT OF STOCK OPTION PLAN AMENDMENT OF STOCK OPTION PLAN

The Corporation has approved, subject to approval by the Shareholders and
any necessary regulatory approval, an amendment to the Corporation's stock
option plan (the "Plan"). The amendment to the Plan would, upon approval by
Shareholders, increase the maximum number of Common Shares reserved for issuance
under the Plan from 4,180,000 to 11,500,000 Common Shares. As at March 27, 2000,
an aggregate of 3,840,567 options to acquire Common Shares were currently
outstanding under the Plan. See "Stock Options".

The Corporation has operations in both Canada and the United States. The
recruitment and retention of highly qualified management and other personnel in
both countries is important to the success of the Corporation. The Corporation
has a structure for the compensation of its employees, incorporating base
salary, health and other insurances, retirement plan and stock options, to
attract and retain highly qualified personnel. That compensation structure is
designed to be competitive with compensation structures of companies in the
markets in which the Corporation competes for personnel. As of the current date,
the Corporation has 4,180,000 shares reserved for issuance under the stock
option plan. This represents approximately 7% of currently outstanding common
shares, which is significantly below the average level of 15% to 20% for
biotechnology companies in the markets in which the Corporation operates. The
proposed amendment will increase the number of shares reserved under the stock
option plan to 11,500,000 or approximately 18% of outstanding common shares of
the Corporation (after giving effect to 5,687,546 common shares to be issued
upon the exercise of special warrants of the Corporation issued on February 29,
2000). This level will provide management and the Board of Directors of the
Corporation with the means to attract and retain key personnel.

In accordance with the rules of The Toronto Stock Exchange (the "TSE"), the
proposed amendment to the Plan must be approved by the affirmative vote of a
majority of the votes cast in person or by proxy at the Meeting, other than by
insiders of the Corporation to whom shares may be issued pursuant to the Plan or
by associates of such persons.

4
<PAGE> 8

To the Corporation's knowledge, there were, as at March 27, 2000, 6,566,000
Common Shares held by insiders of the Corporation and their associates which
will not be counted for purposes of determining such approval.

THE BOARD OF DIRECTORS HAS DETERMINED THAT THE PROPOSED AMENDMENT TO THE
PLAN IS IN THE BEST INTERESTS OF THE CORPORATION AND THE SHAREHOLDERS. THE BOARD
OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE IN FAVOUR OF THE RESOLUTION IN
THIS REGARD, THE FULL TEXT OF WHICH IS SET OUT IN SCHEDULE "A" TO THIS CIRCULAR.
IN ORDER TO BE EFFECTIVE, THE RESOLUTION MUST BE PASSED BY THE AFFIRMATIVE VOTE
OF A MAJORITY OF THE VOTES CAST AT THE MEETING AND RESPECT TO SUCH RESOLUTION,
OTHER THAN VOTES ATTACHING TO COMMON SHARES BENEFICIALLY OWNED BY ANY PERSON TO
WHOM COMMON SHARES MAY BE ISSUED PURSUANT TO THE PLAN OR SUCH PERSON'S
ASSOCIATES. UNLESS SPECIFIED IN THE ENCLOSED FORM OF PROXY THAT COMMON SHARES
REPRESENTED BY THE FORM OF PROXY SHALL BE VOTED AGAINST THIS RESOLUTION, THE
PERSONS DESIGNATED IN THE ENCLOSED FORM OF PROXY INTEND TO VOTE "FOR" THIS
RESOLUTION.

APPROVAL OF ARTICLES OF AMENDMENT - SHARE CONSOLIDATION

At the Meeting, Shareholders will be asked to consider and, if deemed
advisable, to pass, with or without variation, a special resolution approving an
amendment to the articles of the Corporation to consolidate all issued and
outstanding Common Shares on the basis of one (1) post-consolidation Common
Share for every four (4) pre-consolidation Common Shares at the discretion of
the Board of Directors at any time prior to the next meeting of shareholders.

Since its inception, the Corporation has funded its research and
development activities through the sale of common shares in public offerings and
private placements. The Corporation intends to continue to fund its activities
in this manner, if, when and to the extent necessary. As of March 27, 2000, the
Corporation had 57,621,362 Common Shares outstanding. Upon the exercise of
outstanding special warrants of the Corporation issued on February 29, 2000, the
Corporation will have approximately 63,308,908 Common Shares outstanding. The
Corporation has also filed a Preliminary Prospectus dated March 17, 2000
relating to an additional offering of Common Shares.

The proposed share consolidation, if approved and implemented, would
rationalize the share structure of the Corporation relative to other companies
in a similar stage of development and, in the opinion of the Corporation, will
facilitate the issuance of additional common shares, if necessary, to continue
to fund the Corporation's operations. The proposed share consolidation would
decrease the number of Common Shares outstanding by 47,481,681 shares to
15,827,227 shares and would increase the net book value per share of the
Corporation from $0.20 per share to $0.80 per share (both per share amounts
reflecting the pro forma effects of issuances of Common Shares since December
31, 1999).

In addition, the Corporation believes that the current low trading prices
of the Corporation's Common Shares may have a negative impact on the efficient
trading of such shares. In particular, brokerage firms often will not provide a
market for low-priced stock and will not recommend low-priced stock to their
clients. In addition, brokerage firms will often charge a greater percentage
commission on low-priced stock than that which would be charged on a transaction
of a similar dollar amount but fewer shares. These circumstances may adversely
impact trading in the Corporation's Common Shares. Furthermore, the Corporation
believes that its ability to access capital outside its primary market in Canada
may be adversely impacted by its current low trading prices.

Shareholders should note that the effect of the share consolidation upon
the market prices for the Corporation's Common Shares cannot be accurately
predicted. In particular, there is no assurance that prices for the
Corporation's common shares after the share consolidation will be four times the
prices for common shares immediately prior to the share consolidation.
Furthermore, there can be no assurance that the proposed consolidation will
achieve the desired results which have been discussed above, or that the
consolidation will not adversely impact the market price of the common shares or
that any increase in price of the Common Shares will be sustained for any
prolonged period of time.

No fractional shares will be issued as a result of the share consolidation.
A fractional share will be disregarded and cancelled without any repayment of
capital or other compensation. A Shareholder will receive a whole number of
shares.

THE BOARD OF DIRECTORS HAS DETERMINED THAT THE PROPOSED AMENDMENT TO THE
ARTICLES OF THE CORPORATION, AS LISTED IN SCHEDULE "B" TO THE CIRCULAR, IS IN
THE BEST INTERESTS OF THE CORPORATION AND THE SHAREHOLDERS. THE

5
<PAGE> 9

BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE APPROVAL OF
THIS SPECIAL RESOLUTION. IN ORDER TO PASS THE SPECIAL RESOLUTION, AT LEAST
TWO-THIRDS OF THE VOTES CAST BY HOLDERS OF COMMON SHARES, PRESENT IN PERSON OR
BY PROXY, MUST BE VOTED IN FAVOUR OF THE SPECIAL RESOLUTION. UNLESS SPECIFIED IN
THE ENCLOSED FORM OF PROXY THAT COMMON SHARES REPRESENTED BY THE FORM OF PROXY
SHALL BE VOTED AGAINST THIS SPECIAL RESOLUTION, THE PERSONS DESIGNATED IN THE
ENCLOSED FORM OF PROXY INTEND TO VOTE "FOR" THIS SPECIAL RESOLUTION.

If the special resolution is duly passed at the Meeting, management intends
to file the Articles of Amendment with the Director under the Act to give effect
to the changes described herein. The special resolution permits the directors to
revoke the special resolution in whole or in part without further approval by
the shareholders at any time prior to effecting the filing of the Articles of
Amendment, if in their discretion, it is deemed desirable to do so.

If the special resolution amending the articles of the Corporation does not
receive the requisite approval, the articles will remain unchanged.

Unless such authorization is withheld, the persons named in the enclosed
form of proxy intend to vote at the Meeting "For" the approval of the amendment
to the articles of the Corporation, to provide for a consolidation of the Common
Shares of the Corporation.

Upon filing of the Articles of Amendment, the Common Shares will be
consolidated into new Common Shares as set out above. In accordance with the
rules of the TSE, a new CUSIP number will be assigned and replacement share
certificates will be issued. To obtain a new share certificate evidencing the
Common Shares after the consolidation is effective, Shareholders must tender the
certificates evidencing their shares. As soon as practicable after the filing of
the Articles of Amendment, a letter of transmittal containing instructions with
respect to the surrender of the share certificates will be sent to Shareholders
for use in exchanging their share certificates. Shareholders may obtain new
share certificates by completing and returning the letter of transmittal and
share certificates, following announcement by the Corporation that the Articles
of Amendment are effective, to the Corporation's transfer agent, Montreal Trust
Company of Canada, Suite 600, 530-8th Avenue S.W., Calgary, Alberta, T2P 3S8
(Telephone (403) 267-6598).

EXECUTIVE COMPENSATION

COMPENSATION OF EXECUTIVE OFFICERS

The following table sets forth the compensation paid to Richard E. Bagley,
Dr. Antoine A. Noujaim, Edward M. Fitzgerald, Christopher F. Nicodemus and
Marlene R. Booth (the "Named Executive Officers") for each of the fiscal
years ended December 31, 1999, 1998 and 1997 (all amounts presented in Canadian
dollars).

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>

LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
----------------------------------- ------------
COMMON
SHARES UNDER ALL OTHER
NAME AND SALARY BONUS OPTIONS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) GRANTED (#) ($)(5)
- ------------------ ------ ------- ------- ----------- --------

<S> <C> <C> <C> <C> <C>
RICHARD E. BAGLEY(1) 1999 386,158 Nil 1,031,250 1,304
President and Chief 1998 315,179 Nil 825,000 Nil
Executive Officer 1997 -- -- -- --

DR. ANTOINE A. NOUJAIM(1) 1999 220,000 Nil Nil 6,777
Chairman of the Board, 1998 220,000 Nil Nil 6,880
Chief Scientific Officer and Former President 1997 220,000 Nil Nil 6,312
and Chief Executive Officer

EDWARD M. FITZGERALD(2) 1999 293,480 Nil 218,750 298
Senior Vice President, 1998 92,374 Nil 175,000 Nil
Chief Financial Officer and Secretary 1997 -- -- -- --
</TABLE>

6
<PAGE> 10

<S> <C> <C> <C> <C> <C>
CHRISTOPHER F. NICODEMUS(3)............... 1999 290,696 14,973 218,570 274
Senior Vice President 1998 Nil Nil 175,000 Nil
Clinical Research and Development 1997 -- -- -- --

MARLENE R. BOOTH(4)....................... 1999 120,660 Nil 100,000 273
Vice-President of Regulatory 1998 -- -- -- --
Affairs and Project Management 1997 -- -- -- --
</TABLE>

Notes:

(1) Dr. Noujaim became an officer of the Corporation on July 17, 1996. Dr.
Noujaim ceased to be the President and Chief Executive Officer of the
Corporation on February 23, 1998 and Mr. Richard E. Bagley was appointed
President and Chief Executive Officer of the Corporation on that date.

(2) Mr. Fitzgerald joined the Corporation on September 28, 1998.

(3) Dr. Nicodemus was hired by the Corporation in December 1998 and commenced
work in January 1999.

(4) Ms. Booth joined the Corporation on June 1, 1999.

(5) Compensation under the column "All Other Compensation" is with respect to
employee benefits such as health care, life insurance and a group
retirement savings plan. The aggregate amount of perquisites and other
personal benefits, securities and property did not exceed the lesser of
$50,000 and 10 percent of the total annual salary and bonus of the Named
Executive Officer.

CORPORATE GOVERNANCE

Corporate governance refers to the structures and processes employed by the
Corporation to direct and manage its business and affairs, so as to best achieve
the Corporation's objectives. The Board of Directors of the Corporation believes
that these practices should be reviewed regularly to ensure they are
appropriate. The following is a description of the Corporation's corporate
governance practices approved by the Board and which are in accordance with the
guidelines ("Guidelines") established by the TSE.

MANDATE OF THE BOARD OF DIRECTORS

The Shareholders elect the Directors who in turn are responsible for
overseeing all aspects of the operation of the Corporation, including appointing
management and ensuring that the business is managed properly, taking into
account the interests of the Shareholders.

The Board of Directors meets regularly to review operational performance
and financial results and to approve the budget, strategic plan, investment
strategies, executive appointments and performance, stock issuance, and major
financial transactions. The Board of Directors will also act to protect the
Corporation from undue risk by assuring appropriate safeguards including
compliance with all governmental regulations and obtaining necessary insurance.

The Board is responsible for the stewardship of the Corporation. Specific
responsibilities of the Board of Directors include:

- overseeing and evaluating the strategic planning process;

- identifying and implementing appropriate systems to manage the
Corporation's principal risks;

- ensuring that the Corporation operates within all applicable laws and
regulations, and to the highest ethical and moral standards;

- appointing and evaluating senior management;

- developing the Corporation's communications policy;

- ensuring adequate and timely reporting of financial results and other
significant developments and matters to the Corporation's
Shareholders; and

- ensuring the integrity of the Corporation's internal controls and
management information systems.

7
<PAGE> 11

In addition, any responsibility not delegated to senior management or a
committee of the Board, remains with the full Board which meets at least four
times a year. During the period ended December 31, 1999, there were five
meetings of the Board of Directors.

COMPOSITION OF THE BOARD

The Guidelines require that a majority of the Board be composed of
"unrelated directors". An "unrelated director" is defined in the Guidelines as
one who is independent of management and is free from any interest and any
business or other relationship which could, or could be reasonably be perceived
to, materially interfere with that director's ability to act with a view to the
best interests of the Corporation, other than interests and relationships
arising from shareholdings. A related director is one who is not an unrelated
director.

In accordance with the Guidelines, the Board has reviewed the status of
each of the directors and determined that four of the six directors are
unrelated and two are related.

COMPOSITION OF COMMITTEES OF THE BOARD

During 1999, the Board had six standing committees: an Audit Committee, a
Compensation Committee, a Nominating Committee, a Corporate Governance
Committee, an Environmental Committee and a Special Committee. The composition
of each of the committees of the Board is consistent with the Guidelines
established by the TSE.

AUDIT COMMITTEE

The Audit Committee is responsible for the engagement of the Corporation's
independent auditors and reviews with them the scope and timing of their audit
services and any other services they are asked to perform, and report on the
Corporation's financial statements following completion of the audit and the
Corporation's policies and procedures with respect to internal accounting and
financial controls. During 1999, there were two meetings of this committee.

COMPENSATION COMMITTEE

The Compensation Committee makes recommendations to the Board on, among
other things, the compensation of senior executive and Board members. The
committee also reviews and makes recommendations with respect to succession
plans. During 1999, there were two formal meetings and a number of informal
meetings of this committee.

NOMINATING COMMITTEE

The Nominating Committee is responsible for proposing new nominees to the
Board. The Nominating Committee did not meet in 1999.

CORPORATE GOVERNANCE COMMITTEE

The Corporate Governance Committee's mandate is set forth above. The
Corporate Governance Committee did not meet during 1999, however, its mandate
was discharged by the Board during the year.

ENVIRONMENTAL COMMITTEE

The Environmental Committee reviews the processes and controls of the
Corporation relative to compliance with environmental laws, statistics, rules
and regulations particular to the operation of the Corporation. During 1999,
there were no meetings of this committee.

SPECIAL COMMITTEE

In October 1999, the Board established a Special Committee to work with
management of the Corporation on the development and implementation of strategic
and operating plans of the Corporation in light of the decision by Purdue Pharma
L.P. to not exercise its option to licence two of the Corporation's product
candidates.

8
<PAGE> 12

DECISIONS REQUIRING BOARD APPROVAL

In addition to those matters which must by law be approved by the Board,
management is also required to seek Board approval of any material expenditure.
Management is also required to consult with the Board before pursuing capital
projects or strategic ventures which are beyond the Corporation's existing
business. The Corporation's collaborative arrangements with third parties are
also reviewed by the Board. The Board approves all changes in senior management.

BOARD PERFORMANCE

It is the responsibility of the Chairman to ensure the effective operation
of the Board. The Chairman is responsible for ensuring the effectiveness of the
process the Board follows and the quality of information provided to directors
by management. The Chairman also meets at least once each year on an individual
basis with every member of the Board to discuss that director's contributions to
the Board and committee deliberations and any other matters which the individual
directors wish to raise with the Chairman. The Chairman also oversees the
orientation of new directors.

SHAREHOLDER FEEDBACK

The Corporation maintains an investor relations capability which the Board
believes is important and effective. Every shareholder inquiry receives a prompt
response from an appropriate representative of the Corporation.

EXPECTATIONS OF MANAGEMENT

The Board expects management to operate the Corporation in accordance with
approved annual business and strategic plans, to do everything possible to
enhance shareholder value and manage the Corporation in a prudent manner.
Management is expected to provide regular financial and operating reports to the
Board and to make the Board aware of all important issues and major business
developments, particularly those which had not been previously anticipated.
Management is expected to find opportunities for new business and to make
appropriate recommendations to the Board.

The information which management provides to the Board is highly important
to the ability of the Board to function effectively. Directors must have
confidence in the data gathering, analysis and reporting functions of
management. The Chairman of the Board monitors the nature of the information
requested by and provided to the Board.

From time to time, the Board may engage outside advisers at the
Corporation's expense to provide advice to the Board on matters relevant to the
Corporation's activities.

The Corporation's corporate governance practices comply with the
fundamental principles underlying the guidance outlined by the TSE.

STOCK OPTIONS GRANTED TO NAMED EXECUTIVE OFFICERS

The following table details information with respect to the grant of
options by the Corporation to the Named Executive Officers during the financial
year of the Corporation ended December 31, 1999.

OPTION GRANTS DURING THE MOST RECENTLY COMPLETED FINANCIAL YEAR

MARKET VALUE OF
COMMON SHARES
UNDERLYING
COMMON SHARES % OF TOTAL EXERCISE OR OPTIONS ON THE
UNDER OPTIONS OPTIONS GRANTED TO BASE PRICE DATE OF GRANT
GRANTED EMPLOYEES IN (CDN.$/ (CDN.$/COMMON
NAME # FINANCIAL YEAR COMMON SHARE) SHARE) EXPIRATION DATE
- ---- ------------- ------------------ ------------ -------------- ---------------
<S> <C> <C> <C> <C> <C>
RICHARD E. BAGLEY............. 1,031,250 55% 1.03 1.03 July 8, 2009
EDWARD M. FITZGERALD.......... 218,750 12% 1.03 1.03 July 8, 2009
CHRISTOPHER F. NICODEMUS...... 218,750 12% 1.03 1.03 July 8, 2009
MARLENE R. BOOTH.............. 100,000 5% 0.46 0.46 May 11, 2009
</TABLE>

9
<PAGE> 13

The following table details information with respect to all options of the
Corporation exercised by the Named Executive Officers during the last financial
year of the Corporation and all options held by the Named Executive Officers and
outstanding on December 31, 1999.

AGGREGATED OPTION EXERCISES DURING THE MOST RECENTLY COMPLETED
FINANCIAL YEAR END AND FINANCIAL YEAR-END OPTION VALUES

VALUE OF UNEXERCISED
IN-THE-MONEY
OPTIONS AT
UNEXERCISED OPTIONS DECEMBER 31, 1999
COMMON SHARES AT DECEMBER 31, EXERCISABLE/
ACQUIRED ON AGGREGATE VALUE 1999 EXERCISABLE/ UNEXERCISABLE
NAME EXERCISE (#) REALIZED ($) UNEXERCISABLE (#) (CDN.$)
- ---- ------------ --------------- ------------------- ------------------
<S> <C> <C> <C> <C>
RICHARD E. BAGLEY............. Nil Nil 618,750/1,237,500 NA/NA
DR. ANTOINE A. NOUJAIM........ Nil Nil 375,000/0 NA/NA
EDWARD M. FITZGERALD.......... Nil Nil 131,249/262,501 NA/NA
CHRISTOPHER F. NICODEMUS...... Nil Nil 131,249/262,501 NA/NA
MARLENE R. BOOTH.............. Nil Nil Nil/100,000 NA/3,000
</TABLE>

EMPLOYMENT AGREEMENTS

The Corporation has entered into agreements with its executive officers
regarding terms of employment and severance arrangements. Dr. Noujaim's
agreement, dated January 1, 1996 and amended on June 3, 1999, provides for his
employment at will as Chairman and Chief Scientific Officer through December 31,
2001, subject to renewal thereafter. Mr. Bagley's agreement, dated February 28,
1998 and amended on June 4, 1999, provides for his employment at will as
President and Chief Executive Officer. Mr. Fitzgerald's agreement, dated
September 14, 1998 and amended on June 1, 1999, provides for his employment at
will as Senior Vice-President, Chief Financial Officer and Secretary of the
Corporation. Dr. Nicodemus' agreement, dated December 16, 1998 and amended on
June 1, 1999, provides for his employment at will as Senior Vice-President,
Clinical Research and Development. These officers of the Corporation, by virtue
of the June, 1999 amendments to their respective agreements, had severance
arrangements providing for severance upon termination for other than cause at
the rate of their respective base salaries, through the later of December 31,
2001 and the one-year anniversary of termination. These arrangements were
further amended by the Board of Directors in December, 1999 to reduce the total
amount of severance payable to one year for each of these officers. In exchange
for such reduced severance, the Board of Directors granted additional stock
options to such officers (see note to the table in "Stock Options"). Ms. Booth's
agreement, dated May 4, 1999, provides for her employment at will as
Vice-President, Regulatory Affairs and Project Management and severance upon
termination other than for cause of six months of base salary.

COMPOSITION OF COMPENSATION COMMITTEE

The Compensation Committee of the Board of Directors of the Corporation
(the "Compensation Committee") consists of William R. McMahan, Dr. Jim A.
Wright, Normand Balthazard and Richard E. Bagley. Dr. Wright is the Chairman of
the Compensation Committee.

Each of the members of the Compensation Committee, as a director of the
Corporation, has received options to purchase Common Shares pursuant to the
Corporation's stock option plan. See "Stock Options". As directors of the
Corporation, Mr. McMahan, Dr. Wright and Mr. Balthazard each receives an annual
fee. See "Executive Compensation - Compensation of Directors". As officers of
the Corporation, Messrs. Noujaim and Bagley receive certain compensation. See
"Executive Compensation - Compensation of Executive Officers".

REPORT ON EXECUTIVE COMPENSATION

It is the task of the Compensation Committee to periodically review the
compensation structure of the Corporation with respect to its executive officers
to ensure that the Corporation continues to attract and retain quality and
experienced individuals to its management team and to motivate these individuals
to perform to the best of their ability and in the best interests of the
Corporation. The Compensation Committee makes recommendations with respect to
the compensation of the Corporation's executive officers to the Board of
Directors, which gives final approval with respect to any executive compensation
matters and issues.

10
<PAGE> 14

The primary objectives of the Corporation's executive compensation program
are to enable the Corporation to attract, motivate and retain outstanding
individuals and to align their success with that of the Corporation's
Shareholders through the achievement of strategic corporate objectives and
creation of shareholder value. The level of compensation paid to an individual
is based on the individual's overall experience, responsibility and performance.
Factors also to be considered are the compensation levels of similarly situated
positions in the biopharmaceutical industry and other labour markets in which
the Corporation competes for employees. The Compensation Committee compares
remuneration for executive officers of the Corporation to the remuneration for
similar executives in the relevant labour markets. In the case of newly hired
employees, the individual's performance and compensation level in his or her
prior positions will also be a determining factor.

The key components for the compensation of the executive officers of the
Corporation are base salaries, bonuses and stock options. It is the policy of
the Corporation that the base salaries paid to its executive officers, in
addition to the criteria set out above, reflect the individual responsibility
and experience of the executive officer and the contribution that is expected
from the executive officer. Base salaries and bonuses are reviewed by the
Compensation Committee on an annual basis to ensure that these criteria are
satisfied. Stock options under the Corporation's stock option plan are granted
by the Board of Directors to executive officers from time to time as a long-term
performance incentive.

This report submitted on behalf of the Compensation Committee: Messrs.
McMahan, Wright, Balthazard and Bagley.

COMPENSATION OF DIRECTORS

Each director of the Corporation, with the exception of Dr. Noujaim and Mr.
Bagley, receives a fee of U.S.$10,000 per annum. Further, all directors are
eligible to receive stock options and are entitled to receive reimbursement of
their reasonable out-of-pocket disbursements incurred on the business of the
Corporation. In the aggregate, a total of Cdn.$66,670 in fees was paid to
members of the Board of Directors during the period from January 1, 1999 to
December 31, 1999.

DIRECTORS AND OFFICERS LIABILITY INSURANCE

The Corporation provides liability insurance for directors and officers of
the Corporation. The policies do not distinguish between the liability insurance
for its directors and officers, the coverage being the same for both groups. The
premiums for the 12-month period ended December 31, 1999 were approximately
Cdn.$47,878 all of which was borne by the Corporation. The coverage is
Cdn.$10,000,000 per year with a corporate deductible of up to Cdn.$100,000 per
loss. The individual directors and officers of the Corporation are insured
against losses arising from claims against them for certain of their acts,
errors or omissions in such capacity. The Corporation is insured against losses
arising out of any liability to indemnify a director or officer.

11
<PAGE> 15

PERFORMANCE GRAPH

The following performance graph compares the yearly increase in the
Corporation's cumulative total shareholder return on the Common Shares since
August 2, 1996 (the first trading day on the TSE for the Common Shares following
July 17, 1996), with the cumulative total shareholder return on the TSE 300
Index and the TSE Biotech/Pharmaceutical Index, assuming the reinvestment of
dividends, where applicable, for a comparable period.

[GRAPH]

DECEMBER 31,
AUGUST 2, ----------------------------------------- MARCH 15,
INDEX 1996 1996 1997 1998 1999 2000
- ----- --------- ------ ------- ------ ------ ---------
<S> <C> <C> <C> <C> <C> <C>
AltaRex ....................... $ 100.0 $107.1 $ 51.0 $ 7.8 $ 8.3 $52.7
TSE 300 Index.................. $ 100.0 $118.2 $133.6 $129.3 $167.8 $185.3
TSE Biotech/ Pharmaceutical ... $ 100.0 $132.3 $125.6 $168.7 $213.7 $234.3
</TABLE>

INDEBTEDNESS OF DIRECTORS AND OFFICERS

No individual who is, or at any time during the most recent completed
financial year of the Corporation was, a director, executive officer or senior
officer of the Corporation, nor any proposed nominee for election as a director
of the Corporation, nor any associate of any one of them is, or at any time
since the beginning of the most recent completed financial year of the
Corporation has been, indebted to the Corporation or any of its subsidiaries or
was indebted to another entity, which such indebtedness is, or was at any time
during the most recent completed financial year of the Corporation, the subject
of a guarantee, support agreement, letter of credit or other similar arrangement
or understanding provided by the Corporation or any of its subsidiaries, except
that Dr. Thomas Sykes, former Vice President, Pre-clinical and Support
Operations, was indebted to the Corporation in the amount of US$25,000 which was
paid in full upon his resignation from the Corporation on June 30, 1999.

STOCK OPTIONS

The Plan is designed to develop the interest of the directors, officers,
employees and other persons who provide ongoing services to the Corporation and
its subsidiaries in the growth and development of the Corporation by providing
such persons with the opportunity to acquire an increased proprietary interest
in the Corporation and to better enable the Corporation and its Subsidiaries to
attract and retain persons of desired experience and ability. An amendment to
the terms of the Plan has been approved by the Board of Directors, and
Shareholders are being asked to approve such amendment at the Meeting. See
"Particulars of Matters to be Acted Upon - Amendment of Stock Option Plan".

The maximum number of Common Shares which may be reserved for issuance to
any person under the Plan or any other previously established or proposed share
compensation arrangement of the Corporation in respect of all options granted to
any one person at any one time may not exceed 5% of the issued and outstanding
Common Shares.

12
<PAGE> 16

The maximum number of Common Shares reserved for issuance at any time pursuant
to the Plan is currently 4,180,000 but will be increased to 11,500,000, subject
to the approval of Shareholders at the Meeting and applicable regulatory
approval. See "Particulars of Matters to be Acted Upon - Amendment to Sock
Option Plan". The vesting and expiry date of options granted under the Plan are
determined by the Board of Directors at the time the options are granted
provided that the expiry date shall not be later than 10 years from the date of
grant of such option. The exercise price of options granted under the Plan is
fixed by the Board of Directors and shall either be the closing price of the
Common Shares on the TSE on the first date preceding the date of grant or
alternatively the weighted average of the trading prices of the Common Shares
for the five days proceeding the date of grant.

As at March 27, 2000, there were outstanding options to purchase a total of
3,840,567 Common Shares under the Plan and the following table sets out in
detail all stock options issued and outstanding under the Plan.

EXERCISE
NUMBER OF PRICE
SHARES UNDER PER SHARE
GROUP OPTION DATE OF GRANT (CDN.$) EXPIRY DATE
- ----- ------------ ----------------- --------- ------------------
<S> <C> <C> <C> <C>
Directors........................... 382,500 July 26, 1996 1.80 July 26, 2006
(excluding Executive Officers) 2,500 July 8, 1997 3.68 July 8, 2007
(five in total) 80,000 May 21, 1998 2.18 May 21, 2008

Executive Officers.................. 824,130 March 4, 1998 3.00 March 4, 2008
(five in total) 870 July 6, 1998 3.00 July 6, 2008
175,000 September 15, 1998 0.91 September 15, 2008
175,000 December 23, 1998 0.53 December 23, 2008
100,000 May 11,1999 0.46 May 11, 2009
1,468,750 July 28, 1999 1.03 July 8, 2009
75,000 October 8, 1999 0.90 October 8, 2009

Employees........................... 51,500 July 26, 1996 1.80 July 26, 2006
(16 in total) 13,333 February 4, 1997 6.00 February 4, 2007
10,000 December 31, 1996 5.90 December 31, 2006
5,000 July 8, 1997 3.68 July 8, 2007
10,000 February 1, 1998 2.84 February 1, 2008
87,000 May 21, 1998 2.18 May 21, 2008
50,000 August 4, 1998 1.15 August 4, 2008
33,334 November 30, 1998 0.80 November 30, 2008
112,900 July 8, 1999 1.03 July 8, 2009
53,750 August 19, 1999 0.90 August 19, 2009

Consultants
Dr. Terry Allen.................. 5,000 July 8, 1997 3.68 July 8, 2007
Dr. Richard Baum................. 10,000 July 8, 1997 3.68 July 8, 2007
Dr. Beatrice Leveugle............ 5,000 July 8, 1997 3.68 July 8, 2007
Dr. Gerry Miller................. 5,000 July 8, 1997 3.68 July 8, 2007
Dr. John Samuels................. 5,000 July 8, 1997 3.68 July 8, 2007
Dr. Constantine Bona............. 10,000 July 8, 1997 3.68 July 8, 2007
Dr. Jean-Francois Chatal......... 10,000 July 8, 1997 3.68 July 8, 2007
Dr. David Goodwin................ 10,000 July 8, 1997 3.68 July 8, 2007
Dr. James Lown................... 10,000 July 8, 1997 3.68 July 8, 2007
Dr. Dean Mann.................... 10,000 July 8, 1997 3.68 July 8, 2007
Dr. Paul Muller.................. 10,000 July 8, 1997 3.68 July 8, 2007
Dr. Aldo Serafini................ 10,000 July 8, 1997 3.68 July 8, 2007
Dr. David Wishart................ 5,000 November 7, 1997 3.30 November 7, 2007
Genome Securities Inc............ 25,000 July 17, 1998 1.40 July 17, 2008
</TABLE>

Note: On December 22, 1999, the Board of Directors of the Corporation approved
the grant of options to acquire an aggregate of 1,790,000 Common Shares at
a price of $0.35 per share to certain officers of the Corporation and on
February 17, 2000, the Board of Directors of the Corporation approved the
grant of options to acquire an aggregate of 2,553,000 shares at a price of
$1.49 per share, to directors, officers and employees of, and a consultant
to the Corporation. The ability to exercise any of such options is
conditional upon the approval by the Shareholders at its next meeting of
an amendment to the Plan increasing the Common Shares reserved for
issuance from 4,180,000 to 11,500,000.

13
<PAGE> 17

INTERESTS OF INSIDERS IN MATERIAL TRANSACTIONS

Except as described elsewhere herein, none of the Corporation's insiders,
proposed nominees for election as directors of the Corporation or their
associates and affiliates, has any material interest in any transaction with the
Corporation since the commencement of the Corporation's last financial year.

BOARD APPROVAL

The contents and the sending of this Circular have been approved by the
Board of Directors of the Corporation.

By Order of the
Board Of Directors

(Signed) EDWARD M. FITZGERALD
Senior Vice President,
Chief Financial Officer and Secretary

14
<PAGE> 18

CERTIFICATE

The foregoing contains no untrue statement of a material fact and does not
omit to state a material fact that is required to be stated or that is necessary
to make a statement not misleading in light of the circumstances in which it was
made.

(Signed) RICHARD E. BAGLEY (Signed) EDWARD M. FITZGERALD
President and Chief Executive Officer Senior Vice President,
Chief Financial Officer and Secretary

Waltham, Massachusetts
March 27, 2000

15
<PAGE> 19

SCHEDULE "A"

AMENDMENT TO STOCK OPTION PLAN

BE IT RESOLVED THAT:

1. The stock option plan of the Corporation (the "Plan") be and is hereby
amended such that the maximum number of Common Shares which may be reserved
for issuance for all purposes at any time pursuant to the Plan shall be
increased from 4,180,000 to 11,500,000.

2. Any officer or director of the Corporation is hereby authorized, for and on
behalf of the Corporation, to execute and deliver such documents and
instruments and to take such other actions as such officer or director may
determine to be necessary or advisable to implement this resolution and the
matters authorized hereby, such determination to be conclusively evidenced
by the execution and delivery of such documents or instruments and the
taking of any such actions.

16
<PAGE> 20

SCHEDULE "B"

SPECIAL RESOLUTION OF SHAREHOLDERS

ARTICLES OF AMENDMENT - SHARE CONSOLIDATION

BE IT RESOLVED THAT as a special resolution of the Corporation that:

1. the articles of Corporation be amended to consolidate all of the issued and
outstanding Common Shares of the Corporation on the basis of one (1)
post-consolidation Common Share for every four (4) pre-consolidation Common
Share at the discretion of the Board of Directors at any time prior to the
next meeting of shareholders.

2. where the consolidation would otherwise result in a holder of Common Shares
being entitled to receive a fractional Common Share, no such fractional
Common Share will be issued, and the fractional Common Share will be
disregarded and cancelled without any repayment of capital or other
compensation.

3. the Corporation be and is hereby authorized and directed to make
application pursuant to the Act for a Certificate of Amendment under the
Act to give effect to this special resolution.

4. the proper officers of the Corporation be and they are hereby authorized to
take all such actions and execute and deliver all such documents, including
without limitation, articles of amendment in the form prescribed by the
Act, which are necessary or desirable for the implementation of this
special resolution.

5. notwithstanding the foregoing provisions, the Board of Directors of the
Corporation be and they hereby are authorized to revoke this resolution
without any further approval of the Shareholders at any time prior to the
issuance of a Certificate of Amendment under the Act giving effect hereto.

6. Any officer or director of the Corporation is hereby authorized, for and on
behalf of the Corporation, to execute and deliver such documents and
instruments and to take such other actions as such officer or director may
determine to be necessary or advisable to implement this resolution and the
matters authorized hereby, such determination to be conclusively evidenced
by the execution and delivery of such documents or instruments and the
taking of any such actions.

<PAGE> 21

NATIONAL POLICY NO. 31
CHANGE OF AUDITORS REPORTING PACKAGE

[ALTAREX COMPANY LETTERHEAD]

SEPTEMBER 14, 1999

BRITISH COLUMBIA SECURITIES COMMISSION
ALBERTA SECURITIES COMMISSION
SASKATCHEWAN SECURITIES COMMISSION
THE MANITOBA SECURITIES COMMISSION
ONTARIO SECURITIES COMMISSION
COMMISSION DES VALEURS MOBILIERES DU QUEBEC
OFFICE OF THE ADMINISTRATOR OF SECURITIES, NEW BRUNSWICK
NOVA SCOTIA SECURITIES COMMISSION
DEPARTMENT OF JUSTICE, CORPORATIONS DIVISION, PRINCE EDWARD ISLAND
SECURITIES COMMISSION OF NEWFOUNDLAND
UNITED STATES SECURITIES AND EXCHANGE COMMISSION

DEAR SIRS:

RE: CHANGE OF AUDITORS

PURSUANT TO NATIONAL POLICY NO. 31 OF THE CANADIAN SECURITIES ADMINISTRATORS,
ALTAREX CORP. ("ALTAREX") GIVES NOTICE OF A CHANGE OF AUDITORS, AS FOLLOWS:

1. AT THE REQUEST OF ALTAREX, ERNST & YOUNG LLP HAS TENDERED ITS
RESIGNATION AS AUDITORS OF ALTAREX. THE BOARD OF DIRECTORS OF ALTAREX
HAS APPOINTED ARTHUR ANDERSEN LLP AS THE NEW AUDITORS OF ALTAREX TO
FILL THE VACANCY CREATED BY THE RESIGNATION OF ERNST & YOUNG LLP.
2. ALTAREX DELIVERED A NOTICE OF CHANGE OF AUDITORS DATED SEPTEMBER 3,
1999 TO ERNST & YOUNG LLP AND TO ARTHUR ANDERSEN LLP. SUCH NOTICE IS
ATTACHED HERETO.
3. ERNST & YOUNG LLP'S LETTER DATED SEPTEMBER 3, 1999 STATES ITS AGREEMENT
WITH THE INFORMATION CONTAINED IN THE NOTICE. SUCH LETTER IS ATTACHED
HERETO.
4. ARTHUR ANDERSEN LLP'S LETTER DATED SEPTEMBER 9, 1999 STATES ITS
AGREEMENT WITH THE INFORMATION CONTAINED IN THE NOTICE. SUCH LETTER IS
ATTACHED HERETO.
5. BOTH THE AUDIT COMMITTEE AND THE BOARD OF DIRECTORS OF ALTAREX HAVE
CONSIDERED AND APPROVED THE PROPOSAL TO CHANGE AUDITORS AND THE
ATTACHED NOTICE TO AND LETTERS FROM ERNST & YOUNG LLP AND ARTHUR
ANDERSEN LLP.

Sincerely,
ALTAREX CORP.

/s/ Edward M. Fitzgerald

Edward M. Fitzgerald
Senior Vice President and Chief Financial Officer

Enclosures

AltaRex Corp., Suite 125, 303 Wyman Street, Waltham, MA 02451
Tel. (781) 672-0138 Fax: (781) 672-0142 E-mail: [email protected]
www.altarex.com

18
<PAGE> 22

[LOGO]

REPORTING PACKAGE PURSUANT TO NATIONAL POLICY NO. 31 OF THE CANADIAN
SECURITIES ADMINISTRATORS - CHANGE OF AUDITOR OF A REPORTING ISSUER

September 3, 1999

Ernst & Young LLP
Scotia 2, Suite 1800
Scotia Place
Edmonton, Alberta
T5J 3R8

Arthur Andersen LLP
Chartered Accountants
#2100, 355 - 4 Avenue S.W.
Calgary, Alberta
T2P 0J1

Dear Sirs:

RE: CHANGE OF AUDITORS
----------------------

We wish to confirm that Ernst & Young LLP has, at the request of Altarex Corp.
("AltaRex"), tendered its resignation as auditors of AltaRex. The Board of
Directors of AltaRex has appointed Arthur Andersen LLP as the new auditors of
AltaRex to fill the vacancy created by the resignation of Ernst & Young LLP.

We also wish to confirm that:

a) there have been no reservations contained in the audit reports of Ernst &
Young LLP on the consolidated balance sheet of AltaRex as at December 31,
1998 and 1997 and the consolidated statements of loss and accumulated
deficit and cash flows for each of the years then ended;

b) the resignation of Ernst & Young LLP and appointment of Arthur Andersen LLP
as the successor auditors of AltaRex was approved by AltaRex's Audit
Committee and Board of Directors; and

c) there have been no reportable events (disagreements, unresolved issues or
consultations as described in National Policy No 31 of the Canadian
Securities Administrators) in connection with the audit by Ernst & Young LLP
of AltaRex's financial statements as described above.

In accordance with National Policy No 31 of the Canadian Securities
Administrators, please prepare and deliver to AltaRex and to Ernst & Young LLP
or Arthur Andersen LLP, as the case may be, a letter addressed to the securities
regulatory authorities in all the provinces of Canada stating your agreement or
disagreement with the information contained in this notice, based on your
knowledge of such information at the time. In the event of disagreement, please
state your reason therefor.

Yours truly, ALTAREX CORP.

/s/ Edward M. Fitzgerald

Edward M. Fitzgerald
Senior Vice President and Chief Financial Officer

AltaRex Corp., Suite 125, 303 Wyman Street, Waltham, MA 02451
Tel. (781) 672-0138 Fax: (781) 672-0142 E-mail: [email protected]
www.altarex.com

19
<PAGE> 23

<TABLE>
<S> <C> <C>
[ERNST & YOUNG COMPANY LETTERHEAD] [ ] ERNST & YOUNG LLP [ ] Phone: 780-423-3811
CHARTERED ACCOUNTANTS Fax: 780-428-8977
Scotia 2, Suite 1800
Scotia Place
10060 Jasper Avenue
Edmonton, Canada T5J 3R8
</TABLE>

September 3, 1999

PRIVATE AND CONFIDENTIAL

Mr. Edward Fitzgerald
Senior Vice President and
Chief Financial Officer
AltaRex Corp.
Suite 125, 303 Wyman Street
Waltham, MA
02451

Dear Mr. Fitzgerald:

Re: NOTICE OF RESIGNATION

At your request, we tender our resignation as auditors of AltaRex Corp.

Yours sincerely,

/s/ Ernst & Young LLP

B.E. Bailey/R.M. Haffie

[ ] A member of Ernst & Young International, Ltd.

20
<PAGE> 24

September 9, 1999

British Columbia Securities Commission
Alberta Securities Commission
Saskatchewan Securities Commission
The Manitoba Securities Commission
Ontario Securities Commission
Commission des valeurs mobilieres du Quebec
Office of the Administrator of Securities, New Brunswick
Nova Scotia Securities Commission
Department of Justice, Corporations Division, Prince Edward Island
Securities Commission of Newfoundland

Dear Sirs:

RE: ALTAREX CORP. - CHANGE OF AUDITORS

We have read the notice of change of auditors of AltaRex Corp. dated September
3, 1999 and, based on our knowledge of the information contained in such notice,
are in agreement with the information contained therein.

Yours truly,

"ARTHUR ANDERSEN LLP"

<PAGE> 25

[LOGO]

ALTAREX

<PAGE> 1
Exhibit 99.2
ALTAREX CORP.

PROXY

SOLICITED BY MANAGEMENT FOR THE ANNUAL AND SPECIAL MEETING OF
SHAREHOLDERS TO BE HELD ON MAY 3, 2000

The undersigned holder of common shares ("Common Shares") in the capital of
AltaRex Corp. (the "Corporation") hereby appoints Richard E. Bagley, President
and Chief Executive Officer of the Corporation, or failing him, Edward M.
Fitzgerald, Senior Vice President, Chief Financial Officer and Secretary of the
Corporation, or instead of either of the foregoing,.............................
................................................................................
as proxyholder, with full power of substitution, to attend, to act and to vote
for and on behalf of the undersigned at the Annual and Special Meeting of
Shareholders (the "Meeting") to be held on May 3, 2000 at 3:00 p.m. (Toronto
time), and at any adjournment thereof, and the undersigned hereby revokes any
proxy previously given to attend, act and vote at the Meeting for the
undersigned at the Meeting or any adjournment thereof. The said proxyholder is
instructed to vote as specified below:

1. FOR [ ] or WITHHOLD FROM VOTING FOR [ ] the election as directors of
the Corporation each of the nominees, each of whom is described in more
detail in the Management Information Circular of the Corporation dated
March 27, 2000 (the "Circular") prepared in connection with the Meeting.

2. FOR [ ] or WITHHOLD FROM VOTING FOR [ ] the appointment of Arthur
Andersen LLP as the auditors of the Corporation for the ensuing year and to
authorize the board of directors to determine their remuneration.

3. FOR [ ] or AGAINST [ ] the resolution, with or without variation,
approving an amendment to the stock option plan of the Corporation (the
"Plan") increasing the maximum number of Common Shares reserved for
issuance thereunder from 4,180,000 to 11,500,000, the full text of which is
set out in Schedule "A" to the Circular.

4. FOR [ ] or AGAINST [ ] the resolution, with or without variation,
approving an amendment to the articles of the Corporation to consolidate
all issued and outstanding Common Shares on the basis of one (1)
post-consolidation Common Share for every four (4) pre-consolidation Common
Shares at the discretion of the Board of Directors at any time prior to the
next meeting of Shareholders, the full text of which is set out in Schedule
"B" to the Circular.

5. On any amendments or variations to matters identified in the notice of the
Meeting and on any other matters that may properly come before the Meeting,
in such manner as the said proxyholder may see fit.

The Common Shares represented by this proxy will be voted or withheld from
voting on any motion, by ballot or otherwise, in accordance with any indicated
instructions. IN THE ABSENCE OF ANY INSTRUCTIONS ABOVE, THIS PROXY WILL BE VOTED
AT THE MEETING FOR THE RESOLUTIONS REFERRED TO IN ITEMS 1, 2, 3 AND 4 ABOVE. IF
ANY AMENDMENT OR VARIATION TO THE MATTERS IDENTIFIED IN THE NOTICE OF MEETING
WHICH ACCOMPANIES THIS PROXY IS PROPOSED AT THE MEETING OR AT ANY ADJOURNMENT
THEREOF, OR IF ANY OTHER MATTERS PROPERLY COME BEFORE THE MEETING OR ANY
ADJOURNMENT THEREOF, THIS PROXY CONFERS DISCRETIONARY AUTHORITY TO VOTE ON ANY
SUCH AMENDMENT OR VARIATION OR SUCH OTHER MATTERS ACCORDING TO THE BEST JUDGMENT
OF THE APPOINTED PROXYHOLDER.

DATED this day of , 2000.*

------------------------------------------
Signature of Shareholder**

------------------------------------------
Signature of jointholder (if any)

------------------------------------------
Please Print Name(s)

* If this proxy is not dated, it shall be
deemed to bear the date on which it is
mailed by management.

** This proxy must be signed by the
shareholder or his or her attorney duly
authorized in writing or, if the
shareholder is a body corporate, it
must be executed under its corporate
seal or by an officer or attorney
thereof duly authorized. Persons
signing as attorneys, executors,
administrators, trustees, etc., should
so indicate and provide satisfactory
evidence of such authority.

<PAGE> 2

NOTES:

1. A SHAREHOLDER HAS THE RIGHT TO APPOINT
A PROXYHOLDER OTHER THAN THE PERSONS
DESIGNATED IN THIS PROXY AS HIS OR HER
NOMINEE TO ATTEND AND ACT FOR HIM OR
HER AND ON HIS OR HER BEHALF AT THE
MEETING. TO EXERCISE SUCH RIGHT, THE
SHAREHOLDER SHOULD INSERT THE NAME OF
HIS NOMINEE IN THE BLANK SPACE PROVIDED
FOR THAT PURPOSE ABOVE OR COMPLETE
ANOTHER PROXY.

2. Shareholders who are unable to attend
the Meeting are requested to complete
this proxy and return it to the
Corporation's transfer agent, Montreal
Trust Company of Canada 6th Floor, 530
- 8th Avenue S.W., Calgary, Alberta,
T2P 3S8, Attention: Corporate Trust
Department.

3. In order to be valid, proxies must be
received by Montreal Trust Company of
Canada on or before 5:00 p.m. (Calgary
time) on the last business day
preceding the date of the Meeting or
any adjournment thereof or deposited
with the Chairman of the Meeting before
the commencement of the Meeting.