SCHEDULE 14-A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant
Check the appropriate box:
Preliminary Proxy Statement
X Definitive Proxy Statement
Definitive Additional Materials
Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
BioTechnica International, Inc.
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box)
X $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
$500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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:
__________________________________________________________________
4. Proposed maximum aggregate value of transaction:
__________________________________________________________________
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:
__________________________________________________________________
2. Form, Schedule or Registration Statement No.:
__________________________________________________________________
3. Filing Party:
__________________________________________________________________
4. Date Filed:
__________________________________________________________________
BIOTECHNICA INTERNATIONAL, INC.
4001 War Memorial Drive
Peoria, IL 61614
(309) 681-0300
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held on November 14, 1995
To the Shareholders:
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders (the
"Annual Meeting") of BioTechnica International, Inc., a Delaware
corporation (the "Corporation" or "BioTechnica"), will be held at the
Signature Inn, 4112 North Brandywine Drive, Peoria, Illinois 61614, on
Tuesday, November 14, 1995 at 10:00 A.M., local time, for the following
purposes:
(1) To elect seven directors to serve until the next annual
meeting and until their successors shall be elected and shall
qualify;
(2) To ratify the appointment of KPMG Peat Marwick LLP, as
independent auditors of the Corporation for the fiscal year
ending June 30, 1996; and
(3) To transact such other business as may properly come before
the Annual Meeting or any adjournment thereof.
All of the above matters are more fully described in the accompanying
Proxy Statement, into which this Notice is incorporated by reference.
The Board of Directors has fixed the close of business on September
20, 1995 as the record date for the determination of shareholders
entitled to notice of and to vote at the Annual Meeting or any
adjournment thereof, and only shareholders of record at the close of
business on that date will be entitled to vote.
IN ORDER THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING, PLEASE
FILL OUT, DATE, SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY OR PLAN TO
ATTEND THE ANNUAL MEETING IN PERSON OR BY PROXY. A RETURN ADDRESSED
ENVELOPE, WHICH REQUIRES NO POSTAGE, IS ENCLOSED. IF YOU LATER DESIRE TO
REVOKE OR CHANGE YOUR PROXY FOR ANY REASON, YOU MAY DO SO AT ANY TIME
BEFORE THE VOTING, BY DELIVERING TO THE CORPORATION A WRITTEN NOTICE OF
REVOCATION OR A DULY EXECUTED PROXY BEARING A LATER DATE OR BY ATTENDING
THE ANNUAL MEETING AND VOTING IN PERSON.
By Order of the Board of Directors
Jean Christophe (J.C.) Gouache
President and Chief Operating Officer
Peoria, Illinois
October 10, 1995
BIOTECHNICA INTERNATIONAL, INC.
4001 War Memorial Drive
Peoria, IL 61614
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
To be held on November 14, 1995
GENERAL INFORMATION
INTRODUCTION. This Proxy Statement is furnished in connection with
the solicitation by and on behalf of the Board of Directors of the
Corporation of proxies for use at the Annual Meeting to be held at the
Signature Inn, 4112 North Brandywine Drive, Peoria, Illinois 61614, on
Tuesday, November 14, 1995, at 10:00 A.M. local time, and at any
adjournment thereof, and together with the enclosed Form of Proxy and
Annual Report to Shareholders for the fiscal year ended June 30, 1995
(the "Annual Report"), is being mailed to the shareholders on or about
October 12 1995. Except for items specifically incorporated by reference
herein, the Annual Report does not form any part of this Proxy Statement.
REVOCABILITY OF PROXIES. Any proxy given pursuant to this
solicitation may be revoked by the person giving it at any time before
the voting by delivering to the Corporation a written notice of
revocation or a duly executed proxy bearing a later date or by attending
the meeting and voting in person.
COST OF SOLICITATION. The entire cost of this solicitation will be
paid by the Corporation. In addition, the Corporation may reimburse
brokerage firms and other persons representing beneficial owners of
shares for their expenses in forwarding solicitation material to such
beneficial owners. In addition to solicitation by mail, officers and
regular employees of the Corporation may solicit proxies from
shareholders by telephone, telegram or personal interview. Such persons
will receive no additional compensation for such services.
QUORUM AND VOTING. The authorized capital stock of the Corporation
consists of 150,000,000 shares of common stock, $.01 par value;
11,100,000 shares of Class A common stock, $.01 par value; 11,100,000
shares of Class B common stock, $.01 par value, and 2,000,000 shares of
Preferred Stock, $.01 par value (collectively, the shares of the common
stock, Class A common stock, Class B common stock, and Preferred Stock
may be referred to herein as the "Capital Stock"). As of September 20,
1995, there are outstanding 115,379,628 shares of common stock;
- -0- shares of Class A common stock, -0- shares of Class B common stock;
and 700,000 shares of Class A Preferred Stock. All of the issued and
outstanding shares of common stock of record as of September 20, 1995 are
entitled to vote at the Annual Meeting.
Only shareholders of record (not including Treasury Shares) of the
115,379,628 shares of the common stock, outstanding as of the close of
business on September 20, 1995, will be entitled to vote. Each share of
common stock is entitled to one vote upon each matter submitted to a vote
of the shareholders of the Corporation at the Annual Meeting or any
adjournment thereof. The presence, in person or by proxy, of the holders
of a majority of the outstanding shares of the common stock entitled to
vote is necessary to constitute a quorum at the Annual Meeting. Votes
submitted as abstentions on any matter to be voted on at the Annual
Meeting will be counted as votes against such matters. Broker non-votes
will not count for or against the election of directors, or the
ratification of the appointment of KPMG Peat Marwick LLP as the
independent auditors of the Corporation.
PROPOSAL 1: ELECTION OF DIRECTORS
In accordance with the Corporation's Bylaws, the Board of Directors
has fixed the number of directors at seven (7). At the Annual Meeting,
the shareholders of the Corporation will be asked to consider and vote
upon the election of seven (7) directors to serve until the next annual
meeting and until their successors shall be elected and shall qualify.
Unless authority to vote for any of the nominees named below is withheld,
the shares represented by the enclosed proxy will be voted for the
election of such nominees as Directors of the Corporation. The Board of
Directors has no reason to believe that any nominee will become
unavailable for election. However, in the event any one or more of such
nominees shall unexpectedly become unavailable for election, the shares
represented by the enclosed proxy will be voted for the election of such
other persons as may be designated by the Board of Directors.
Pursuant to the terms of the Credit Enhancement and Reorganization
Agreement dated October 26, 1993, by and among Groupe Limagrain Holding,
S.A. ("Limagrain"), Limagrain Genetics Corp. ("LG Corp.") and the
Corporation (the "Limagrain Agreement"), approved by the shareholders at
the March 7, 1994 Annual Meeting of Shareholders, LG Corp. agreed to
cause no less than two (2) of the members serving on the Board of
Directors at the time the Corporation entered into the Limagrain
Agreement (the "Continuing Directors") to sit on the Board of Directors
of the Corporation at all times during the three (3) year period
following the Second Closing (as such term is defined in the Limagrain
Agreement) which occurred on March 7, 1994. Dr. Hardy and Mr. Hittinger
have been named as the Continuing Director nominees for election at the
Annual Meeting.
The following information is furnished with respect to the nominees
for election as Directors of the Corporation:
Principal Occupations the Last Director
Name Age Five Years; Other Directorships Since
George R. Allbritten 64 Mr. Allbritten retired as the Vice 1994
President-Finance, Secretary, Treasurer,
and Chief Financial Officer of the
Corporation on August 31, 1994, an office
he had held since October 1993. From
December 1990 to October 1993, Mr.
Allbritten was President-Chief Operating
Officer of Ferry-Morse Seed Company, a
subsidiary of Limagrain, where he also
served as Senior Vice President from 1983
to 1990 and Vice President-Finance from
1973 to 1983.
Ralph W.F. Hardy 61 In 1996, Dr. Hardy will become 1984
President of the National Agricultural
Biotechnology Council. From September
1986 until August 1995, Dr. Hardy was
President and Chief Executive Officer
of the Boyce Thompson Institute for
Plant Research at Cornell University.
From November 1984 to January 1986, Dr.
Hardy was President and Chief Operating
Officer of the Corporation.
William C. Hittinger 72 Mr. Hittinger retired as Executive Vice 1992
President of RCA Corporation in 1986,
after being with the company since 1970.
Mr. Hittinger served on the RCA Board of
Directors from 1974 to 1982. Prior to
joining RCA, Mr. Hittinger was President
of General Instrument Corporation, a post
he held from 1968. Mr. Hittinger serves
as a director of International
Recognition, Inc., a supplier of data
entry and data management hardware and
software; and UNC, Inc., a supplier of
aviation parts and services. He is a
fellow of the Institute of Electrical
and Electronics Engineers (IEEE); a
fellow of the Royal Society of Arts; a
trustee of Lehigh University; and a
member of the National Academy of
Engineers. Mr. Hittinger was a member
of President Reagan's National Security
Telecommunications Advisory Committee
from 1982 to 1986 and the United
States-Brazil Presidential Committee
on Science and Technology in 1987.
Claude Agier 50 Mr. Agier has been a member of the 1994
Limagrain Cooperative since 1966 and
has served as a director of all the
companies belonging to the Field
Seeds Division of the Limagrain Group
since 1985. Mr. Agier manages a farm
of 150 acres.
Jean Ferrand 63 Mr. Ferrand has served as Chairman of 1994
the Board of Directors since March 1994.
Mr. Ferrand is a farmer and rancher by
profession. He has been a member of the
Limagrain Cooperative Board of Directors
since 1966 and Deputy Chairman since 1984.
He is Chairman of the Board of Directors
of all the companies belonging to the
Field Seeds Division of the Limagrain
Group. Mr. Ferrand serves as a director
of the agricultural Cooperative COPAVAL,
and the Wheat Producers Association (Paris).
He is a Regional Legal Arbitrator, and
member of the City Council of St.
Pourcain sur Sioule (Allier, France).
Laurent Petoton 59 Mr. Petoton has been a member of the 1994
Limagrain Cooperative since 1971 and
has served as director since 1978. He
has been Chairman of the Board of
Directors of Force Limagrain BV (Holland)
since 1989 and has served as a director
of all the companies belonging to the
Field Seeds Division of the Limagrain
Group since 1985. Mr. Petoton is a
Board member of the local branch of the
Credit Agricole Bank.
Emmanuel Rougier 43 Chief Executive Officer ("CEO") of the 1994
Corporation since March 1994, Mr.
Rougier has been a member of the
Limagrain Group Operating Committee
since 1989. He has served as a
director and Chief Executive Officer
of the principal companies of the
Field Seeds Division of the Limagrain
Group since 1989. Mr. Rougier is Vice
President of SEPROMA (French Hybrid
Corn Seed Companies Organization) and
Vice President of FFSF (French Forage
and Lawn Grass Seed Companies
Association). He was nominated Export
Trade Advisor of the French Ministry of
Export and Trade in 1993.
DIRECTOR'S COMPENSATION, MEETINGS AND COMMITTEES
Directors who are not salaried employees of, or consultants to, the
Corporation or representatives of Limagrain are entitled to receive an
annual retainer of $4,000 each. Directors who are salaried employees of
the Corporation are not entitled to any additional remuneration above and
beyond their salary. Directors who are representatives of Limagrain are
not entitled to any remuneration from the Corporation. Directors who are
consultants to the Corporation are not entitled to any additional
remuneration above and beyond the amounts set forth in their individual
consulting agreements. During the fiscal year ended June 30, 1995
("Fiscal 1995"), Messrs. Ferrand, Rougier, Agier and Petoton were
representatives of Limagrain, and therefore, received no remuneration
from the Company for their services as Directors of the Corporation. Dr.
Hardy and Mr. Hittinger have consulting agreements with the Corporation
which provide for the payments of $15,000 per year. During Fiscal 1995,
Dr. Hardy and Mr. Hittinger were each paid $15,000. Mr. Allbritten
receives an annual retainer of $4,000. Mr. Allbritten elected to defer
payment until January 1996 for his services from November 1994 through
December 1994 and all of calendar year 1995. Mr. Allbritten has received
payment from the Corporation for services rendered pursuant to the sale
of the Scott Seed Division of the Corporation (See "CERTAIN RELATIONSHIPS
AND OTHER RELATED TRANSACTIONS").
The Board of Directors of the Corporation held a total of two (2)
regularly scheduled and special meetings during Fiscal 1995. During that
fiscal year, no incumbent director attended fewer than 100% of the
meetings of the Board of Directors and the committees of the Board of
Directors upon which he served.
The Board of Directors has appointed an Audit Committee and a
Compensation Committee. The Audit Committee consists of Dr. Hardy, Mr.
Hittinger, and Mr. Rougier. The Audit Committee's functions are to
recommend the selection of independent auditors and to carry out such
activities related to the financial statements of the Corporation as the
Board of Directors shall from time to time request. The Audit Committee
held one (1) meeting during Fiscal 1995.
The Compensation Committee, which consists of Messrs. Agier, Petoton
and Rougier, reviews and approves employment policies and administers the
1992 Stock Incentive Plan. The Compensation Committee held one (1)
meeting during Fiscal 1995.
A vote of a plurality of all shares of the common stock present in
person or by proxy and voting at the Annual Meeting is necessary for the
election of the nominees as Directors of the Corporation. IF LIMAGRAIN,
WHICH CONTROLS APPROXIMATELY 85% OF THE ISSUED AND OUTSTANDING SHARES OF
COMMON STOCK OF THE CORPORATION, VOTES ITS SHARES IN FAVOR OF THE
ELECTION OF THE NOMINEES FOR THE BOARD OF DIRECTORS NAMED ABOVE, THEN
SUCH NOMINEES WILL BE ELECTED TO THE BOARD OF DIRECTORS, REGARDLESS OF
THE VOTE OF ANY OTHER SHAREHOLDER.
THE BOARD OF DIRECTORS RECOMMENDS ELECTION OF THE NOMINEES LISTED ABOVE
AS DIRECTORS OF THE CORPORATION.
PROPOSAL 2. RATIFICATION OF APPOINTMENT OF
INDEPENDENT AUDITORS
The Board of Directors has selected KPMG Peat Marwick LLP, independent
auditors, to audit the financial statements of the Corporation for the
fiscal year ending June 30, 1996. KPMG Peat Marwick LLP has audited the
Corporation's financial statements annually since 1981, and those of
Shissler Seed Company since 1991.
Representatives of KPMG Peat Marwick LLP will be present at the Annual
Meeting with the opportunity to make a statement and to respond to
appropriate questions.
A vote of the majority of all shares present in person or by proxy and
voting at the Annual Meeting is necessary for the ratification of KPMG
Peat Marwick LLP as the Corporation's independent auditors for the fiscal
year ending June 30, 1996. IF LIMAGRAIN, WHICH CONTROLS 85% OF THE
ISSUED AND OUTSTANDING SHARES OF COMMON STOCK OF THE CORPORATION, VOTES
ITS SHARES IN FAVOR OF THE RATIFICATION OF THE APPOINTMENT OF KPMG PEAT
MARWICK LLP AS THE CORPORATION'S INDEPENDENT AUDITORS FOR THE FISCAL YEAR
ENDING JUNE 30, 1996, THE APPOINTMENT WILL BE RATIFIED REGARDLESS OF THE
VOTE OF ANY OTHER SHAREHOLDER. If the appointment of KPMG Peat Marwick
LLP is not approved at the Annual Meeting, the Board of Directors will
consider the selection of another accounting firm.
THE BOARD OF DIRECTORS RECOMMENDS THE RATIFICATION OF THE APPOINTMENT
OF KPMG PEAT MARWICK LLP AS THE CORPORATION'S AUDITORS FOR THE FISCAL
YEAR ENDING JUNE 30, 1996.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information concerning the
record and beneficial ownership of each shareholder known to the
Corporation to be the beneficial owner of more than five percent of the
Corporation's common stock as of September 20, 1995. The persons
identified have sole voting and investment power with respect to all such
shares unless otherwise noted.
<TABLE>
<CAPTION>
Number of Shares of Approximate Percentage
Common Stock of Common Stock
Beneficially Owned Beneficially Owned (1)
<S> <C> <C>
Groupe Limagrain 98,277,178(2) 85.0%
Holding S.A.
BP1
63720 Chappes
France
State Farm Automobile 11,324,051 9.8%
Insurance Company
One State Farm Plaza
Bloomington, IL 61701
(1) Pursuant to the Securities and Exchange Commission beneficial
ownership rules, each person's beneficial ownership percentage
is calculated based upon the number of shares issued and
outstanding plus the number of shares issuable upon conversion
or exercise of convertible notes, options or warrants held by
such person at September 20, 1995, and convertible or exercisable
within 60 days, assuming no similar conversion or exercise by
other persons holding such notes, options or warrants.
Percentages of common stock held are based on 115,379,628
shares of common stock outstanding as of September 20,
1995, -0- shares of Class A common stock convertible into
Voting common stock outstanding as of September 20, 1995,
-0- shares of Class B common stock convertible into Common
Stock outstanding as of September 20, 1995 and 234,625
options exercisable within 60 days to acquire common stock.
(2) Includes 98,277,178 shares of common stock owned
beneficially and of record by its subsidiary LG Corp.
</TABLE>
MANAGEMENT OF BIOTECHNICA
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth, as of September 20, 1995, certain
information regarding the beneficial ownership of the common stock held
by each director, each nominee for election as a director and by all
directors and executive officers as a group. None of the directors
beneficially own any other class of equity securities other than common
stock. The persons identified have sole voting and investment power with
respect to such shares unless otherwise noted. Claude Agier, Jean
Ferrand, Laurent Petoton, Emmanuel Rougier, J.C. Gouache, Bruno Carette,
George Allbritten and Philip Nordeen are not the record or beneficial
owner of any shares of common stock.
<TABLE>
<CAPTION>
Number of Shares of Approximate Percentage
Common Stock of Common Stock
Beneficially Owned Beneficially Owned
<S> <C> <C>
Ralph W.F. Hardy 60,130(1) *
William C. Hittinger 9,000(2) *
All directors and executive 95,380(3) *
officers as a group--twelve
(12) persons
*Denotes less than 1%
(1) Includes options to purchase 50,000 shares of common stock
exercisable within 60 days.
(2) Includes options to purchase 5,000 shares of common stock
exercisable within 60 days.
(3) Includes options to purchase 70,000 shares of common stock
exercisable within 60 days.
</TABLE>
INFORMATION ABOUT EXECUTIVE OFFICERS
Information about the executive officers of the Corporation who are
not nominees for election as Directors is set forth below. All executive
officers serve at the discretion of the Board of Directors.
Position with the Corporation, Principal
Name Age Occupations During the Last Five Years
Jean Christophe 40 Mr. Gouache was appointed President and Chief
(J.C.) Gouache* Operating Officer of the Corporation on April
19, 1994. Prior to this appointment, Mr.
Gouache served as Vice President and Chief
Operating Officer since March 1994. Mr. Gouache
also has been General Manager-Executive Vice
President of Shissler Seed Company ("Shissler")
since May 1992. From July 1991 to April 1992,
Mr. Gouache was Sales and Marketing Director
of Shissler, and from 1988 to 1991 he was Corn
Breeder and Research Station Manager of the
Limagrain Genetics Research Facility at South
Amana, Iowa. Mr. Gouache is a member of the
Limagrain Field Seed Division Committee and the
Limagrain Research Orientation Committee.
Bruno Carette* 40 Mr. Carette was appointed Vice President, Sales
and Marketing on August 22, 1994. Mr. Carette
served as Company Production Manager at
Vilmorin S.A., a Limagrain affiliate, from
1990 to 1993. He was the Overseas Production
Manager at Vilmorin S.A. from 1988 to 1990.
Larry D. Rieffel* 48 Mr. Rieffel has served as Corporate Production
and Logistics Manager of the Corporation since
July 1, 1994. Prior to that date, he served in
various senior management positions of the
Corporation and with NobleBear Seed Company
before it was acquired by the Corporation.
Edward M. Germain* 43 Mr. Germain was appointed Chief Financial
Officer and Secretary of the Corporation
effective November 1, 1994. Mr. Germain served
as Controller of Shissler Seed Company from
1993 to 1994. Prior to that date, he held
various financial and management positions with
Briggs Industries, Inc. and Pekin Energy
Company.
Philip M. Nordeen 35 Mr. Nordeen was appointed Chief Accounting
Officer and Treasurer of the Corporation
effective November 1, 1994. Prior to that
date Mr. Nordeen served in various financial
management positions in the former BioTechnica
organization and with Commerce Bank of Kansas
City.
*Indicates a member of the BioTechnica International, Inc./LG Seeds, Inc.
Operating Committee.
REPORT OF THE COMPENSATION COMMITTEE OF THE
BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION
The following is the report of the Compensation Committee of the
Corporation (the "Committee") on executive compensation for Fiscal 1995
for executives of the Corporation other than the CEO.
COMPENSATION PHILOSOPHY: The Committee believes that it is in the
best interest of the shareholders of the Corporation for the Corporation
to attract, maintain and motivate top quality management personnel,
especially its executive officers. The general philosophy of the
Committee is to integrate (i) reasonable levels of annual base
compensation; and (ii) annual cash bonuses based on achievement of short-
term corporate and individual performance goals, such that executive
compensation levels will be higher in years in which performance goals
are achieved or exceeded.
The elements of the Committee's integrated compensation philosophy are
summarized as follows:
BASE COMPENSATION LEVELS: The base compensation levels for the
management of the Corporation are determined according to the
compensation policy in place at Limagrain for its executives.
PERFORMANCE BASED COMPENSATION: The compensation package for
management of the Corporation also includes performance-based elements.
Annual cash bonuses can be earned based on achievement of Corporation
and/or individual base performance goals determined at the beginning of
the year by the Chairman of the Committee for Mr. Gouache, the Chief
Operating Officer of the Corporation, and proposed by Mr. Gouache and
reviewed by the Chairman of the Committee for all other executives.
Economic results are the primary measure of Corporate performance.
RELATIONSHIP OF CORPORATE PERFORMANCE TO FISCAL 1995 COMPENSATION:
For Fiscal 1995, the Performance Based Compensation Amount for Mr.
Gouache consisted of a cash bonus to be paid subsequent to the end of the
fiscal year. The amount to be paid will be calculated based on four
factors: (i) an amount equal to approximately one-half month's salary
for each $4.4 million in sales increase compared to the previous year;
(ii) an amount equal to 0.3% times an amount approximately equal to cash
generated by operations; (iii) an amount based upon the attainment of
specific action goals as determined by the CEO; and (iv) an amount based
upon the financial results of Limagrain Genetics International. As of
June 30, 1995, the Corporation accrued $5,000 for Performance Based
Compensation for Mr. Gouache; however, the CEO and Compensation Committee
have not yet determined whether performance goals were achieved for
Fiscal 1995 and whether a cash bonus will be paid to Mr. Gouache.
A substantially similar arrangement existed for Fiscal 1994 under which
Mr. Gouache received a cash bonus of $13,255.
COMPENSATION OF CHIEF EXECUTIVE OFFICER: Mr. Emmanuel Rougier, the
Chief Executive Officer of the Corporation, does not receive any
compensation directly from the Corporation. Mr. Rougier is an employee
of Limagrain, not the Corporation. The Corporation has entered into a
service agreement (see "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS")
with Limagrain Genetics International, an affiliated company, to provide
various management, administrative, and financial services. This service
agreement covers services provided by Mr. Rougier and, therefore, the
cost of Mr. Rougier's services are covered by and included in the service
agreement. The Corporation does not provide any additional direct or
indirect compensation to Mr. Rougier.
The Committee is composed of Mr. Rougier, CEO of the Corporation, and
Messrs. Petoton and Agier neither of whom are employees of the
Corporation, but both of whom are members of the board of directors of
Limagrain.
Emmanuel Rougier, Chairman
Laurent Petoton
Claude Agier
STOCK PERFORMANCE GRAPH
The following line graph compares the yearly percentage change:
(i) in the Corporation's cumulative Total Stockholders Return (as
herein defined) (the solid line); with
(ii) the cumulative Total Stockholders Return of the NASDAQ
United States Composite Index (the long broken line); with
(iii) the cumulative Total Stockholder return of a customized group
of companies involved in the seed industry (the "New Custom
Composite Index") (the short broken line); and with
(iv) the cumulative Total Stockholder Return of a customized
group of Farming, Seeds, and Milling Industry Group, as
identified by FactSet Data Systems (the "Old Custom Composite
Index") (the short and long broken line).
"Total Stockholder Return" is calculated quarterly, with dividends
reinvested at the ex-dividend date for each quarter and return
compounded. The graph uses an initial investment of $100 on December 31,
1989, cumulating the total return for each month for each component,
BioTechnica, the NASDAQ United States Composite Index, the New Custom
Composite Index, and the Old Custom Composite Index, each assuming
dividend reinvestment. The customized Custom Composite indices were
prepared by weighting the return of each customized group member
according to their respective market capitalization on a quarterly basis.
The New Custom Composite Index consists of AgriBioTech, Inc., Calgene
Inc., DEKALB Genetics Corp. - Class B, Delta and Pine Land Co., Mycogen
Corp., Pioneer Hi-Bred International, The Scotts Company - Class A, and
Zeneca Group Plc-ADR. Some companies included in the New Custom
Composite Index have only become publicly traded since December 1989.
These companies and the dates they began trading are: The Scotts
Company-January 31, 1992; Zeneca Group Plc ADR-May 12, 1993; Delta and
Pine Land Co.-June 30, 1993; and AgriBioTech-December 13, 1993.
The Old Custom Composite Index consisted of Alico Inc., American Maize
Products - Class A, Archer Daniels Midland Co., Calgene Inc., DEKALB
Genetics Corp. - Class B, DNA Plant Technology Corp., Ecogen Inc., Embrex
Inc., Midwest Grain Products Inc., Pioneer Hi-Bred International, and
Tejon Ranch Co.
Management believes the "New Custom Composite Index" is a better
indicator of the relative performance of the Corporation's common stock
because such new index consists of companies that are primarily engaged
in the seed industry, as opposed to the Old Custom Composite Index which
consisted of companies that are large corporations in various areas of
agribusiness.
The Corporation's fiscal year currently ends June 30. Prior to 1994, the
Corporation's fiscal year ended July 31; prior to 1992, the Corporation's
fiscal year ended December 31.
The historical stock price performance shown on this graph is not
necessarily indicative of future performance.
<TABLE>
<CAPTION>
12/89 12/90 12/91 7/92 7/93 6/94 6/95
<S> <C> <C> <C> <C> <C> <C> <C>
BioTechnica Intl. $100 $ 89 $150 $111 $ 81 $ 25 $ 11
NASDAQ Composite
Index (U.S.) $100 $ 85 $136 $136 $165 $166 $222
New Custom
Composite Index $100 $ 85 $152 $161 $155 $186 $278
Old Custom
Composite Index $100 $ 99 $159 $146 $141 $154 $193
</TABLE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE: The following table summarizes, for each
of the last three fiscal periods, the compensation awarded, paid to or
earned by (i) the CEO of the Corporation, (ii) the COO, who performs many
of the functions normally associated with the CEO function, and (iii)
each of the four most highly compensated executive officers other than
the CEO who served as executive officers of the Corporation or its
subsidiaries, as of June 30, 1995, whose annual compensation exceeded
$100,000, if any. The Corporation does not currently award restricted
stock, stock options, stock appreciation rights, or other long-term
incentive compensation under its executive compensation program.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long-Term
Compensation
Name and Annual Compensation Awards All Other
Principal Position Year Salary Bonus Options/SARs Compensation
<S> <C> <C> <C>
Emmanuel Rougier (1)
Chief Executive Officer
Jean Christophe (J.C.)
Gouache 1995 $107,330(2) $5,000(3) (4)
President and Chief 1994 73,200(2) 13,255 (4)
Operating Officer
No other officers of the Corporation had annual compensation in excess of
$100,000.
(1) Mr. Rougier is not paid by the Corporation. See "COMPENSATION OF CHIEF
EXECUTIVE OFFICER" and "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS."
(2) Includes personal use of Corporation automobile.
(3) Represents the amount accrued during Fiscal 1995 in anticipation of
performance bonuses which may or may not be paid, at the discretion
of the Chairman of the Compensation Committee, based on the
attainment of performance based goals.
(4) Mr. Gouache is covered under the retirement system established
under French law. The French retirement system is similar to the
social security system -- a company makes mandatory contributions
on behalf of all of its employees based on a percentage of the
employee's salary. The funds are paid to, and administered by, a
governmental entity. The amount of the contribution on behalf of
each employee is mandatory. In addition, in France a company may
elect to make additional contributions on behalf of its employees
and if a company chooses to do so, such additional contributions
are governed by the same principles as for the mandatory
contributions as described herein. Limagrain normally makes
additional contributions on behalf of all of its employees.
</TABLE>
OPTION/SAR GRANTS IN FISCAL 1995
During Fiscal 1995, there were no options/SARs granted to any
director, officer or employee of the Corporation.
AGGREGATE OPTION/SAR EXERCISES IN FISCAL 1995
AND OPTION VALUES AT JUNE 30, 1995
During Fiscal 1995, there were no options/SARs exercised by any
officer, director or employee of the Corporation and there were no
unexercised in-the-money options/SARs outstanding to any officer,
director or employee as of June 30, 1995.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
None of the members of the Compensation Committee has ever been (i) an
employee or officer of the Corporation or any of its subsidiaries or (ii)
had any relationship requiring disclosure under any paragraph of Item 404
or in Item 402(j)(3) of Regulation S-K promulgated by the Commission,
with the exception of Mr. Rougier, who has served as the CEO of the
Corporation since March 1994. Mr. Rougier does not receive compensation
directly from the Corporation. Mr. Rougier is an employee of Limagrain,
not the Corporation. The Corporation has entered into a service
agreement (see "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS") with
Limagrain Genetics International, an affiliated company, to provide
various management, administrative, and financial services. This service
agreement covers services provided by Mr. Rougier and, therefore, the
cost of Mr. Rougier's services are covered by and included in the service
agreement. The Corporation does not provide any additional direct or
indirect compensation to Mr. Rougier. Messrs. Agier and Petoton are
representatives of Limagrain.
DIRECTOR COMPENSATION
Directors who are not salaried employees of, or consultants to, the
Corporation or representatives of Limagrain are entitled to receive an
annual retainer of $4,000 each. Directors who are salaried employees of
the Corporation are not entitled to any additional remuneration above and
beyond their salary. Directors who are representatives of Limagrain are
not entitled to any remuneration from the Corporation. Directors who are
consultants to the Corporation are not entitled to any additional
remuneration above and beyond the amounts set forth in their individual
consulting agreements. During Fiscal 1995, Messrs. Ferrand, Rougier,
Agier and Petoton were representatives of Limagrain, and therefore,
received no remuneration from the Company for their services as Directors
of the Corporation. Dr. Hardy and Mr. Hittinger have consulting
agreements with the Corporation which provide for the payments of $15,000
per year. During Fiscal 1995, Dr. Hardy and Mr. Hittinger were each paid
$15,000. Mr. Allbritten receives an annual retainer of $4,000. Mr.
Allbritten elected to defer payment until January 1996 for his services
from November 1994 through December 1994 and all of calendar year 1995.
Mr. Allbritten has received payment from the Corporation for services
rendered pursuant to the sale of the Scott Seed Division of the
Corporation (See "CERTAIN RELATIONSHIPS AND OTHER RELATED TRANSACTIONS,"
page 13).
CERTAIN RELATIONSHIPS AND OTHER RELATED TRANSACTIONS
The Corporation, through relationships with LG Corp. (its 85% parent),
is an affiliate of the Limagrain Group. The Limagrain Group consists of
a cooperative of 500 French farmers and the multi-national group of
companies owned by them. In total, these companies represent the third
largest seed company in the world. The Limagrain Group is recognized as
a leader in seed research, seed production, and seed marketing, as well
as biotechnology research and applications. The Limagrain Group also has
investments and joint ventures with other companies throughout the world
in various agribusiness industries.
The Corporation has contractual relationships with a number of other
Limagrain affiliated companies. The terms of these contracts are
negotiated annually between the Corporation and each individual
affiliated company. Management believes that such contracts (i) are
reasonable, necessary and in the best interests of all of the
shareholders of the Corporation, and (ii) are on terms no less favorable
to the Corporation than the Corporation could obtain from non-affiliated
third parties or on which the Corporation could internally perform the
services provided in such contracts. The Audit Committee of the Board of
Directors of the Corporation has independently reviewed the basis for
these contracts and has recommended that the Board of Directors of the
Corporation approves and ratifies such contracts as are in effect for the
current fiscal year. The Board of Directors of the Corporation,
including all of the Directors unaffiliated with Limagrain, has
unanimously voted to approve and ratify such contracts as are in effect
for the current fiscal year.
A summary of these relationships follows below:
EXPORT HYBRID CORN SALES TO AFFILIATED COMPANIES
The Corporation produces and sells seed corn grown in the United
States to affiliates of Limagrain in Europe. These agreements are
renegotiated each year, based on product conditions at the time,
availability of extra capacity at the Corporation's production and
processing facilities, and the needs of the European affiliates of
Limagrain. Such negotiations are conducted on an arms-length basis by
management of the Corporation and a representative of the respective
affiliate. These agreements specifically identify the product to be
produced by the Corporation, the quantity to be purchased, and the
quality and specifications for that product. Management believes that
these contracts are a benefit to the Corporation in that they cover the
variable costs involved, contribute to absorbing fixed operating costs
and augment the profits of the Corporation. There is no assurance that
the Corporation and the Limagrain affiliates will continue to reach
agreement on such arrangements in the future and, in such event, there
will be a negative impact upon the Corporation's sales and profit
margins. During Fiscal 1995, the total sales made under these contracts
represented $3,089,000.
HYBRID CORN LICENSE AGREEMENT
The Corporation has entered into an agreement with LG Corp. (an
affiliate of Limagrain and 85% parent of the Corporation) to allow the
Corporation to market various proprietary hybrid corn genetics developed
through the LG Corp. research program. In exchange for the right to sell
these proprietary genetics, the Corporation has agreed to pay royalties
to LG Corp. For Fiscal 1995, the amount of these royalties was
approximately $81,000. Management anticipates that the royalty rate will
remain stable but that the dollar amount paid to LG Corp. under this
agreement will increase in the future due to an increase in the volume of
sales of these genetics.
Management believes the royalties paid under this agreement are as or
more favorable to the Corporation as compared to the royalties paid in
the seed corn industry generally for the use of proprietary genetic
material.
SOYBEAN GENETICS LICENSE AGREEMENT
The Corporation has entered into an agreement with Callahan
Enterprises ("Callahan") (a division of LG Corp.) to allow the
Corporation to market various proprietary soybean products developed
through Callahan's research program. In exchange for the right to sell
these products, the Corporation has agreed to pay royalties to Callahan.
For Fiscal 1995, the amount of these royalties was approximately $35,000.
Callahan makes the same type of products available to non-affiliated
competitor companies in the seed industry. Management believes the
royalty rates charged to the Corporation are as or more favorable to the
Corporation as compared to the royalty rates charged to non-affiliated
customers of Callahan.
BIOTECHNOLOGY SERVICE AGREEMENT
The Corporation has entered into an agreement with BIOCEM S.A.
("BIOCEM") (an affiliate of Limagrain) to provide access to the
biotechnology research conducted by the Limagrain Group around the world.
Through this agreement, the Corporation not only has access to the
results of the research but also has the right to propose topics for
future study.
During Fiscal 1995, the Corporation paid $30,000 to BIOCEM under the
terms of this agreement. Management believes that the fees paid pursuant
to this agreement are as or more favorable to the Corporation as compared
to (i) the fees that the Corporation would have to pay to a non-
affiliated party for substantially similar services and (ii) the costs
required to perform such services internally.
LIMAGRAIN INNOVATIONS SERVICE AGREEMENT
The Corporation has entered into an agreement with Limagrain
Innovations (an affiliate of Limagrain) whereby Limagrain Innovations
will provide various administrative, financial and accounting services to
the Corporation that the Corporation does not otherwise provide for
itself. Limagrain Innovations is the worldwide "corporate" function of
the Limagrain Group. Significant items covered under this agreement are:
a. STRATEGIC PLANNING AND CONTROL
Limagrain Innovations monitors the economic environment of the
Corporation, and the seed industry in general, and provides
advice and guidance to management in developing long-term
plans and objectives. In addition, Limagrain Innovations
assists in the preparation and review of the annual long-
term planning documents of the Corporation.
b. HUMAN RESOURCES AND BENEFITS
Limagrain Innovations provides assistance to the Corporation
in the form of recruitment services, career evaluation,
training opportunities, and compensation evaluation. In
addition, Limagrain Innovations coordinates and evaluates
the benefit programs offered by the Limagrain Group companies
in North America.
c. FINANCING/TREASURY ACTIVITIES
Limagrain Innovations provides technical support for the
Corporation in negotiations with its bankers. In addition,
Limagrain Innovations provides short-term financing to the
Corporation to meet cash flow requirements. Limagrain
Innovations has been critical in negotiating favorable
interest rates and financing terms.
d. AUDITING SERVICES
Limagrain Innovations assists the Corporation in negotiations
with its outside auditors regarding the cost of services.
Limagrain Innovations also provides internal audit services to
the Corporation.
The Corporation paid $90,000 to Limagrain Innovations under this
service agreement for Fiscal 1995. Management believes that the fees paid
pursuant to this agreement are as or more favorable to the Corporation as
compared to (i) the fees that the Corporation would have to pay to a non-
affiliated party for substantially similar services and (ii) the costs
required to perform such services internally.
LIMAGRAIN GENETICS INTERNATIONAL SERVICE AGREEMENT
The Corporation has entered into an agreement with Limagrain Genetics
International ("LGI") (an affiliate of Limagrain) whereby LGI will
provide various administrative, technical and marketing services to the
Corporation. LGI is the "division" of the Limagrain Group responsible
for the operations of the Corporation.
a. CHIEF EXECUTIVE OFFICER
LGI provides the services of the Chief Executive Officer
of the Corporation, Mr. Emmanuel Rougier. In addition,
LGI pays all travel and other expenses for Mr. Rougier in
his capacity as Chief Executive Officer of the Corporation.
b. BOARD OF DIRECTORS
In their capacity as Board members of LGI, four directors of
LGI are representatives of Limagrain on the Board of Directors
of the Corporation. No fees or costs are paid by the
Corporation for the services of these directors.
c. RESEARCH
LGI coordinates the traditional plant breeding programs of
the Limagrain Group for the crops the corporation markets.
The Corporation receives information on the results of
these activities and has the opportunity to provide
suggestions on potential avenues of future research.
d. MARKETING PLANNING
LGI provides advice and planning services to the Corporation
in regard to the development of business and marketing plans
and strategies.
e. ADMINISTRATIVE/ACCOUNTING SUPPORT
LGI provides expertise to the Corporation in monitoring
short-term planning and month-to-month financial analysis
and control.
f. BRAND NAME
LGI allows the Corporation to use the "LG" brand name and
logo in its marketing efforts.
The Corporation paid $200,000 to LGI under this service agreement for
Fiscal 1995. Management believes that the fees paid pursuant to this
agreement are as or more favorable to the Corporation as compared to (i)
the fees that the Corporation would have to pay to a non-affiliated party
for substantially similar services and (ii) the costs required to perform
such services internally.
NICKERSON SA SERVICE AGREEMENT
The Corporation has entered into an agreement with Nickerson SA
("Nickerson") (an affiliate of Limagrain) whereby the Corporation will
provide office space and one employee to Nickerson for use in monitoring
its business in the United States. The agreement also calls for the
Corporation to pay invoices on behalf of Nickerson, which Nickerson
reimburses to the Corporation on a monthly basis.
Under the terms of this agreement, in addition to the reimbursement of
direct expenses as described above, Nickerson was invoiced $15,000 by the
Corporation for Fiscal 1995 (based on an annual fee of $45,000).
FINANCIAL TRANSACTIONS WITH LG CORP.
LG Corp. (the 85% parent of the Corporation) has two outstanding loans
to the Corporation as follows:
a. A two-year note in the amount of $3,260,846. The note is
subordinated to all debt outstanding to Harris Bank and Trust
Company. The note bears interest at LIBOR (London Inter-
bank Offered Rate) plus 0.4375% and is due July 1, 1997.
b. A two-year note in the amount of $2,000,000. This note
bears interest at LIBOR plus 1.15% and is due on December 1,
1996.
Management believes both of these notes bear interest at rates below that
which the Corporation would be able to obtain from an unaffiliated lender
for an unsecured loan.
In addition, from time to time during Fiscal 1995, the Corporation was
advanced cash by LG Corp. and other Limagrain affiliates, to allow the
Corporation to meet covenants under the revolving credit arrangement with
Harris Bank and Trust Company (the "Letter of Credit"). The Corporation
reimbursed LG Corp. and other Limagrain affiliates for actual interest
costs and fees incurred to borrow these funds. There were no outstanding
cash advances as of June 30, 1995.
On November 30, 1994, the Corporation issued to LG Corp. 200,000
shares of the Corporation's Class A Preferred Stock at $10.00 per share,
in exchange for the surrender of a promissory note evidencing $2,000,000
in short-term debt. LG Corp. currently owns $7,000,000 (700,000 shares)
of Class A Preferred Stock of the Corporation.
There is no assurance that LG Corp., or any other affiliate of
Limagrain, will continue to (i) loan funds to the Corporation, or (ii)
invest additional equity in the Corporation. In addition, there is no
assurance that, without such loans and investments, the Corporation would
not be out of compliance with (a) the terms of the Harris Bank Line of
Credit, or (b) the NASDAQ Stock Market quantitative maintenance criteria,
during seasonal fluctuations in the Corporation's borrowing base and net
tangible assets, respectively.
TAX SHARING AGREEMENT
The Corporation, LG Corp., and each of LG Corp.'s other subsidiaries
entered into a Tax Sharing Agreement as of November 30, 1994. The
purpose of this Tax Sharing Agreement is to provide for an annual system
of allocating federal tax liabilities and certain state and local tax
liabilities of LG Corp., the Corporation, and each of LG Corp.'s other
subsidiaries for purposes of computing each member's annual earnings and
profits and making cash payments between the members to reflect the
allocation of such tax liabilities. Generally, the parties to the Tax
Sharing Agreement have agreed to allocate their consolidated income tax
liabilities in accordance with the method provided in Section 1552(a)(1)
of the Internal Revenue Code, as amended, and the regulations promulgated
thereunder.
ALLBRITTEN CONTRACT
The Corporation entered into a contract with George Allbritten (a
former officer and current Director of the Corporation) to act as agent
for the Corporation in negotiations involving the sale of the Scott Seed
Division of the Corporation. Under the terms of this agreement, Mr.
Allbritten was paid $30,000 plus out-of-pocket expenses in return for
these services.
OTHER MATTERS
The Board of Directors knows of no other business which will be
presented at the Annual Meeting. If any other business is properly
brought before the Annual Meeting, it is intended that the shares
represented by the enclosed proxy will be voted in respect thereof in
accordance with the judgment of the persons voting the proxies.
DEADLINE FOR RECEIPT OF SHAREHOLDERS' PROPOSALS
Proposals of shareholders of the Corporation which are intended to be
presented by the Corporation at the Corporation's 1996 annual meeting of
shareholders must be received by the Corporation no later than June 12,
1996, that they may be included in the Proxy Statement and Form of Proxy
relating to that meeting.
GENERAL
In order that your shares may be represented if you do not plan to
attend the meeting, and in order to assure the required quorum, please
sign, date and return your proxy promptly.
INCORPORATION BY REFERENCE
The following information from the Corporation's Annual Report to
Shareholders for the fiscal year ended June 30, 1995, and which
accompanies this Proxy Statement is incorporated herein by reference:
"Business," "Properties," "Legal Proceedings," "Market for the
Company's Common Equity and Related Stockholder Matters," and
"Management's Discussion and Analysis of Financial Condition and Results
of Operations."
By Order of the Board of Directors
/s/ J.C. Gouache
Jean Christophe Gouache
President and Chief Operating Officer
October 10, 1995
Appendix I: Proxy Card
BIOTECHNICA INTERNATIONAL, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF THE SHAREHOLDERS TO BE HELD ON NOVEMBER 14, 1995
The undersigned hereby appoints Jean Christophe Gouache and Edward M. Germain,
and each of them, with power of substitution in each, the proxy (the "Proxy")
for and in the name of the undersigned to vote all shares of Common Stock, $.01
par value, of BioTechnica International, Inc. (the "Corporation") which the
undersigned should be entitled to vote at the Annual Meeting of Shareholders
of the Corporation to be held on November 14, 1995, and at any adjournments
thereof, upon matters set forth in the Notice of Meeting, as indicated on the
reverse side of this proxy card.
(Continued and to be voted, signed and dated on reverse side)
Please mark your
X votes as in this
example
For all nominees Withheld Authority
listed at right (except to to vote for all
vote as marked to the nominees
contrary below) listed at right
Nominees:Claude Agier
1. Election George Allbritten
of Jean Ferrand
Directors Ralph W.F. Hardy
William C. Hittinger
Instructions: To withold authority to vote Laurent Petoton
for any nominee write that nominee's name Emmanual Rougier
in the space provided below
FOR AGAINST ABSTAIN
2. Approval of the appointment of KPMG
Peat Marwick LLP, independent certified
public accountants, as auditors for the
Corporation for the fiscal year ending
June 30, 1996
3. In their discretion, the Proxies are further authorized to vote upon
such other business as may properly come before this meeting
THE PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER, IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES AND FOR PROPOSAL 2.
Note: These matters have been proposed by the Corporation and are not
related to or conditioned on the approval of other matters.
Signature __________ Date _________ Signature __________ Date ________
Note: Where stock is registered jointly in the name of two or more persons,
all should sign. Signature(s) should correspond exactly with the names
as shown above. Please sign and date and return promptly in the enclosed
envelope. No postage need be affixed if mailed in the United States.
