<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-2.
</TABLE>
NU-TECH BIO-MED, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-12.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE> 2
NU-TECH BIO-MED, INC.
55 ACCESS ROAD
WARWICK, RHODE ISLAND 02886
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 20, 1997
------------------------
To the Stockholders of
NU-TECH BIO-MED, INC.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of NU-TECH
BIO-MED, INC., a Delaware corporation (the "Corporation"), will be held at the
Sheraton Tara Airport Hotel at 1850 Post Road, Warwick, Rhode Island 02886 on
June 20, 1997 at 5:00 p.m., eastern standard time, for the following purposes:
1. To elect two Class 1 Directors to the Corporation's Board of
Directors to serve until the 2000 Annual Meeting and until their successors
shall have been elected; and
2. To transact such other business as may properly be brought before
the Annual Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on May 13, 1997 as
the record date for the determination of Stockholders entitled to Notice and to
vote at the meeting or any adjournment thereof.
Enclosed are a Proxy Statement, a Proxy Card and a self-addressed envelope
in which to return the Proxy Card. All Stockholders, whether or not they expect
to be present at the meeting, are requested to date and sign the Proxy Card and
to return it in the addressed envelope promptly. Stockholders who attend the
meeting may, if they wish, vote in person even though they have previously
submitted a Proxy Card. Any prior Proxy Card will automatically be revoked if
you execute the accompanying Proxy Card or if you notify the Secretary of the
Corporation, in writing, prior to the Annual Meeting.
By Order of the Board of Directors
David A. Sterling
Secretary
May 16, 1997
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND
SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE IN ORDER
TO ASSURE REPRESENTATION OF YOUR SHARES. NO POSTAGE NEED BE AFFIXED IF MAILED IN
THE UNITED STATES.
<PAGE> 3
NU-TECH BIO-MED, INC.
55 ACCESS ROAD
WARWICK, RHODE ISLAND 02886
------------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 20, 1997
------------------------
This Proxy Statement and accompanying form of Proxy has been mailed on or
about May 16, 1997 to the
holders of the Common Stock of record on May 13, 1997 of NU-TECH BIO-MED, INC.,
a Delaware corporation (the "Corporation") in connection with the solicitation
of proxies by the Board of Directors of the Corporation for use at the Annual
Meeting of Stockholders (the "Annual Meeting") to be held at the Sheraton Tara
Airport Hotel at 1850 Post Road, Warwick, Rhode Island 02886, at 5:00 p.m.
eastern standard time and any adjournment thereof.
SOLICITATION, VOTING AND REVOCABILITY OF PROXIES
On May 13, 1997 (the "Record Date"), there were 2,746,365 shares of Common
Stock, par value $.01 per share ("Common Stock") of the Corporation issued and
outstanding. Only holders of Common Stock of record at the close of business on
the Record Date are entitled to receive notice of, and to vote at, the Annual
Meeting and any adjournment thereof. Each share of Common Stock is entitled to
one vote on each matter presented to Stockholders. Voting is on a non-cumulative
basis. The shares of Common Stock represented by each properly executed Proxy in
the accompanying form will, if no contrary instruction is received, be voted (i)
FOR the election of two Class 1 Directors to serve until the Annual Meeting of
Stockholders to be held in the year 2000.
Any Proxy may be revoked at any time before it is voted. A Stockholder may
revoke this Proxy by notifying the Secretary of the Corporation either in
writing prior to the Annual Meeting or in person at the Annual Meeting, by
submitting a Proxy bearing a later date or by voting in person at the Annual
Meeting. Election of directors is by plurality vote, with the nominees for each
Class of director receiving the highest vote totals to be elected as directors
of the Corporation for that particular class. Accordingly, abstentions and
broker non-votes will not affect the outcome of the election of directors.
Abstentions and such non-votes will, however, be considered as votes represented
at the Annual Meeting solely for quorum purposes. The Proxy also provides that
the persons authorized thereunder may, in the absence of instructions to the
contrary, vote or act in accordance with their judgment on any other matters
properly presented for action at the Annual Meeting or any adjournment thereof.
The Corporation will bear the cost of the solicitation of proxies by the
Board of Directors. The Corporation may use the services of its executive
officers and certain Directors to solicit proxies from shareholders in person
and by mail, telegram and telephone. Arrangements may also be made with brokers,
fiduciaries, custodians, and nominees to send proxies, proxy statements and
other material to the beneficial owners of the Corporation's Common Stock held
of record by such persons, and the Corporation may reimburse them for reasonable
out-of-pocket expenses incurred by them in so doing.
The Annual Report to Stockholders for the fiscal year ended December 31,
1996, including financial statements, accompanies this Proxy Statement.
The principal executive offices of the Corporation are located at 55 Access
Road, Warwick, Rhode Island 02886; the Corporation's telephone number is (401)
732-6520.
<PAGE> 4
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors of the Corporation has selected Ernst & Young LLP as
independent auditors of the Corporation for the fiscal year ended December 31,
1997. Stockholders are not being asked to approve such selection because such
approval is not required under the Corporation's Certificate of Incorporation or
Bylaws. The audit services provided by Ernst & Young LLP shall consist of
examination of financial statements, services related to filings with the
Securities and Exchange Commission and consultation in regard to various
accounting matters. Representatives of Ernst & Young LLP are expected to be
present at the meeting and will have the opportunity to make a statement if they
so desire, and will be available to respond to appropriate questions.
VOTING SECURITIES AND SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The securities entitled to vote at the Annual Meeting are the Corporation's
Common Stock, par value $.01 per share, of which 2,746,365 shares are issued and
outstanding as of the Record Date. Each share of Common Stock entitles the
holder thereof to one vote on each matter submitted to Stockholders. Voting for
Directors is on a non-cumulative basis.
Set forth below is certain information as of the Record Date with respect
to the ownership of Common Stock by (i) the persons (including any "group" as
that term is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended), known by the Corporation to be the beneficial owner of more than five
percent of any class of the Corporation's voting securities, (ii) each director
and each officer, and (iii) directors and executive officers as a group. Except
to the extent indicated in the footnotes to the following table, each of the
individuals listed below possesses sole voting power with respect to the
securities listed opposite such individual's name.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT OF AND NATURE OF PERCENTAGE
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF CLASS
- ---------------------------------------------------------- ----------------------- ----------
<S> <C> <C>
J. Marvin Feigenbaum...................................... 745,316(1) 21.9%
55 Access Road
Warwick, RI 02886
Edmond E. Charrette, M.D. ................................ 19,975(2) *
304 Cambridge Road
Woburn, MA 01801
Leonard Green............................................. 13,309(3) *
55 Access Road
Warwick, RI 02886
David A. Sterling......................................... 14,809(3) *
55 Access Road
Warwick, RI 02886
Michael G. Jesselson...................................... 170,382(4) 5.8%
1301 Avenue of Americas
New York, New York
Chriss W. Street.......................................... 10,309(5) *
Chriss Street & Company
1111 Bayside Drive Suite 100
Corona del Mar, CA 92625
Robert B. Fagenson........................................ 10,309(5) *
19 Rector Street
New York, NY 10006
All Officers and Directors as
a Group (6 persons in number)........................... 814,027(1)(2)(3)(5) 23.5%
</TABLE>
- ---------------
* Less than 1%.
2
<PAGE> 5
(1) Includes (i) 9,999 shares of Common Stock owned by Mr. Feigenbaum; (ii)
45,316 shares of Common Stock held in a trust for the benefit of a minor
child of Mr. Feigenbaum, as to which shares Mr. Feigenbaum disclaims
beneficial ownership; (iii) 54,500 options owned by the Feigenbaum
Foundation, as to which options Mr. Feigenbaum disclaims a beneficial
interest in; and (iv) options and warrants to purchase an aggregate of
595,500 shares of Common Stock.
(2) Includes (i) 3,809 shares of Common Stock; (ii) presently exercisable
options to purchase 2,857 shares of Common Stock; and (iii) options to
purchase 13,309 shares of Common Stock granted under the Corporation's
Non-Employee Director Plan.
(3) Includes options to purchase 13,309 shares of Common Stock under the
Corporation's Non-Employee Director Plan.
(4) Represents Common Stock Purchase Warrants owned by several trusts of which
Michael G. Jesselson is a trustee, co-trustee and/or a beneficiary and
therefore holds shared voting power as follows: (i) Michael Jesselson & Lucy
Lang TTEES UIT FBO Yosepha Jesselson -- 8,571 Common Stock Purchase
Warrants; (ii) Michael Jesselson & Linda Jesselson TTEES UIT Fbo Jonathan
Judah Jesselson -- 8,571 Common Stock Purchase Warrants; (iii) Michael
Jesselson & Linda Jesselson TTEES UIT FBO Yaira Jesselson -- 8,571 Common
Stock Purchase Warrants; (iv) Michael Jesselson & Linda Jesselson TTEES UIT
FBO Maya Ariel Ruth Jesselson -- 8,571 Common Stock Purchase Warrants; (v)
Erica Jesselson, Lucy Lang, Claire Strauss, Michael Jesselson & Benjamin
Jesselson TTEES UIT FBO Benjamin Jesselson -- 12,699 Common Stock Purchase
Warrants; (vi) Erica Jesselson, Lucy Lang, Claire Strauss, Michael Jesselson
& Benjamin J. Jesselson TTEES UIT FBO Michael Jesselson -- 110,700 Common
Stock Purchase Warrants; and (vii) Michael Jesselson, Erica Jesselson, Lucy
Lang, Clair Strauss and Benjamin J. Jesselson, TTEES UIT FBO
Grandchildren -- 12,699 Common Stock Purchase Warrants.
(5) Includes options to purchase 10,309 shares of Common Stock under the
Corporation's Non-Employee Director Plan.
3
<PAGE> 6
I. ELECTION OF DIRECTORS
GENERAL
At the Annual Meeting, two Class 1 Directors are to be elected, each to
serve until the 2000 Annual Meeting and until their successors are elected and
qualified. The Corporation's Amended and Restated Certificate of Incorporation
provides for a classified Board of Directors with three classes, designated
Class 1, Class 2 and Class 3. The terms of Class 2 and Class 3 Directors
continue until the Annual Meetings in 1998 and 1999, respectively. The number of
Directors comprising the entire Board of Directors is determined in accordance
with the By-Laws of the Corporation. The By-Laws provide for the number of
Directors to be not less than three nor more than eleven in number. The Board of
Directors currently consists of a total of six (6) persons.
THE TWO NOMINEES FOR CLASS 1 DIRECTORS ARE J. MARVIN FEIGENBAUM AND ROBERT
B. FAGENSON.
The affirmative vote of a plurality of the outstanding Common Shares
entitled to vote for Directors at the Annual Meeting is required to elect the
Directors. All proxies received by the Board of Directors will be voted for the
election as Directors of the nominees specified in the enclosed proxy if no
direction to the contrary is given. In the event any nominee is unable to serve,
the proxy solicited hereby may be voted, in the discretion of the proxies, for
the election of another person in his stead. The Board of Directors knows of no
reason to anticipate this will occur.
NOMINEES FOR ELECTION AS CLASS 1 DIRECTOR TO SERVE UNTIL THE 2000 ANNUAL MEETING
OF STOCKHOLDERS
J. Marvin Feigenbaum. Mr. J. Marvin Feigenbaum, 47 years of age, was
elected to the Board of Directors in June 1994, at which time he was also
elected to the Board of Directors of Analytical Biosystems Corporation ("ABC")
and elected Chief Executive and Chief Financial Officer of the Corporation and
Chief Executive and Chief Financial Officer of ABC. From August 1993 to May
1994, Mr. Feigenbaum served as a consultant to the Corporation, primarily with
respect to the Corporation's business development and plans and programs
relating to the marketing and exploitation of the Corporation's laboratory and
medical testing services. From 1987 to June 1994, Mr. Feigenbaum acted as an
independent consultant in the medical and health care industry generally. He has
over 20 years of experience in the health care industry. Prior to being an
independent consultant, Mr. Feigenbaum, from 1982 to mid-1987, served as
Chairman, President and Chief Executive Officer of Temco Home Health Care
Products, Inc., a durable medical equipment manufacturer. Mr. Feigenbaum
presently serves as a member of the Board of Directors and Vice-Chairman of
Comprehensive Care Corporation ("CompCare"), a corporation listed on the New
York Stock Exchange. On February 24, 1995, a group of holders of CompCare 7 1/2%
Convertible Subordinated Debentures filed an involuntary petition against
CompCare under Chapter 7 of the United States Bankruptcy Code in the United
States Bankruptcy Court for the Northern District of Texas, Fort Worth Division.
This petition was dismissed by the Court on March 7, 1995 upon the joint motion
of CompCare and petitioners.
Robert B. Fagenson. Mr. Robert B. Fagenson, 48 years of age, serves as a
Class 1 Director as the nominee of Starr Securities, Inc. Under the terms of its
underwriting agreement with Starr Securities entered into in December 1994 in
connection with the Corporation's public offering consummated in December 1994,
the Corporation agreed to use its best efforts for a period of five years to
nominate and have elected to its Board of Directors one nominee of Starr
Securities. Mr. Fagenson has, for more than the past five years, been President
and a Director of Fagenson & Co., Inc., a registered broker-dealer, and
Vice-President and Director of Starr Securities Inc., a registered
broker-dealer. Mr. Fagenson is a Director of the New York Stock Exchange. He is
also a Director of The Microtel Franchise and Development Company, a developer
of economy lodging facilities; Autoinfo, Inc., a dealer in computerized products
and services for after-market motor vehicle parts; Rent-Way, Inc., a multi store
retail chain in the rent-to-own industry; and Healthy Planet Products, Inc., a
publicly-held greeting card company listed on the American Stock Exchange.
4
<PAGE> 7
CLASS 2 DIRECTORS WHOSE TERMS CONTINUE UNTIL THE 1999 ANNUAL MEETING OF
STOCKHOLDERS
David A. Sterling. Mr. David A. Sterling, 40 years of age, has served on
the Board of Directors since December, 1994. Mr. Sterling, for in excess of
seven years, has been President of Sterling & Sterling, Inc., a general
insurance agency. Mr. Sterling holds a BBA Degree from Hofstra University, New
York.
Leonard Green. Mr. Leonard Green, 70 years of age, was elected to the
Board of Directors in September 1994. Mr. Green has been the President and Chief
Executive Officer of Green Management and Investment Co., a New York private
investment firm, since 1985. From 1980 to 1985, Mr. Green was President and
Chief Executive Officer of Yuma Management Corp. Prior to such time, from 1972
to 1980, Mr. Green served as Chairman and Chief Executive Officer of Quality
Care, Inc. Mr. Green received his Bachelor of Science degree from George
Washington University. Mr. Green also serves on the Board of Directors of Apria
Healthcare, Inc.
CLASS 3 DIRECTORS WHOSE TERMS CONTINUE UNTIL THE 1998 ANNUAL MEETING OF
STOCKHOLDERS
Chriss W. Street. Mr. Chriss W. Street, 47 years of age, was elected to
the Board of Directors at the 1995 Annual Meeting and serves as a Class 3
Director of the Corporation. Mr. Street is the President of Chriss Street and
Company, Inc., a financial advisory firm which provides a wide variety of
financial advisory and research services. Mr. Street founded the firm in 1992.
Prior thereto, and from 1987 to 1992, Mr. Street was a Managing Director of
Seidler Amdec Securities, Inc. Mr. Street has, since 1993, served as Chairman
and, since 1994, has additionally served as President and Chief Executive
Officer of Comprehensive Care Corporation ("CompCare"), a behavioral health care
company listed on the New York Stock Exchange. On February 24, 1995, a group of
holders of CompCare 7 1/2% Convertible Subordinated Debentures filed an
involuntary petition against CompCare under Chapter 7 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the Northern District
of Texas, Fort Worth Division. This petition was dismissed by the Court on March
7, 1995 upon the joint motion of CompCare and petitioners. Mr. Street is Chief
Financial Officer of Hacienda Village Modernization Corp., which is a joint
venture construction firm founded by Mr. Street in 1994 to bid for federally
funded construction contracts rehabilitating housing projects in Los Angeles,
California inner city neighborhoods. In March 1995, he was elected as a Director
of StreamLogic Corporation (formerly known as Micropolis Corporation), a company
traded on the Nasdaq Stock Market. Additionally, in June 1996, he was elected as
a Director of Freuhauf Trailer Corporation ("Freuhauf"), a company formerly
listed on the New York Stock Exchange. On October 22, 1996, Freuhauf filed a
voluntary petition under Chapter 11 of the United States Bankruptcy Code.
Subsequently, Mr. Street was elected President and Chairman of the Board of
Directors of Freuhauf.
Edmond E. Charrette, M.D. Dr. Edmond Charrette, 62 years of age, was
elected a Director on May 4, 1993. Dr. Charrette is the co-founder and Chairman
of Health Resources Corporation (principally engaged in occupational medicine
services). He also is a Partner of Ascendant Healthcare International (an
investment group with equity investments in the Latin American healthcare
sector) and serves as President of Latin Healthcare Investment Management Co.,
LLC (a group composed of Ascendant Healthcare International and The Global
Environmental Fund which manages and directs the investment activities of the
Latin Healthcare Investment Fund). Previously, he was the Executive Vice
President and Chief Medical Officer of Advantage Health Corporation (a
multi-hospital rehabilitation and post-acute care system) from June 1994 to
March 1996. From 1988 to May 1994, Dr. Charrette served as the Corporate Medical
Director and Senior Vice President of Medical Affairs of Advantage Health
Corporation.
COMMITTEES OF THE BOARD OF DIRECTORS
In December, 1994 the Board of Directors established an Audit Committee
consisting of Messrs. Feigenbaum, Green and Charrette, a Stock Option Committee
consisting of Messrs. Green, Street and Sterling and a Compensation Committee
comprised of Messrs. Green, Street and Fagenson. The Audit Committee reviews (i)
with management the finances, financial condition and interim financial
statements of the Corporation, (ii) with the Corporation's independent auditors
the year-end financial statements of the Corporation as reported by such
auditors, (iii) with the independent auditors the management letter of such
auditors and (iv) with management the implementation of any action recommended
by the independent auditors. The Stock Option Committee oversees the
Corporation's 1994 Incentive Stock Option Plan.
5
<PAGE> 8
MEETINGS OF THE BOARD OF DIRECTORS/COMMITTEES
During the fiscal year ended December 31, 1996, the Board of Directors held
three (3) meetings, and action was taken on six (6) occasions by unanimous
written consent of the Board of Directors in lieu of a meeting. Each director of
the Corporation participated in every action taken by unanimous consent of the
Board of Directors in lieu of a meeting. Each director of the Corporation
attended all of the meetings of the Board of Directors except for Mr. Fagenson,
who did not attend one (1) meeting.
COMPENSATION OF DIRECTORS
For the year ended December 31, 1996, non-employee Directors were
compensated $1,500 per quarter, and an attendance fee of $500 for each meeting
of the Board. In addition, Directors are reimbursed for travel expenses for
attendance at Board Meetings. Directors who are not regular full time employees
of the Corporation are eligible to participate in the Corporation's Non-Employee
Director Plan. Under the Non-Employee Director Plan, each Non-Employee Director
receives options to purchase 5,000 shares of the Corporation's Common Stock upon
joining the Board and options to purchase 8,000 shares of the Corporation's
Common Stock on each anniversary date of service for the prior year of service.
THE BOARD OF DIRECTORS HAS RECOMMENDED THAT YOU VOTE "FOR" ALL NOMINEES.
6
<PAGE> 9
EXECUTIVE COMPENSATION AND RELATED MATTERS
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following provides certain information concerning all Plan and Non-Plan
(as defined in Item 402 (a)(ii) of Regulation S-B) compensation awarded to,
earned by, paid or accrued by the Corporation during the years ended December
31, 1996, 1995 and 1994 to the Chief Executive Officer and each of the Named
Executive Officers of the Corporation.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
--------------------------
ANNUAL COMPENSATION PAYOUTS
------------------------ AWARDS ---------
OTHER -------------------------- ALL OTHER
ANNUAL RESTRICTED SECURITIES COMPEN-
SALARY COMPEN- STOCK UNDERLYING SATION
NAME AND PRINCIPAL POSITION YEAR ($) SATION ($) AWARD(S) OPTIONS ($)
- ------------------------------- ---- -------- ---------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
J. Marvin Feigenbaum........... 1996 $186,917 $205,686(6) 500,000(3)(8) $11,952(7)
Chief Executive and Chief 1995 $182,000 $108,000(2) $943,750(3) 0 $ 6,000(4)
Financial Officer (1) 1994 $153,250(1) $175,000 150,000 $ 6,544(5)
</TABLE>
- ---------------
(1) President, Chief Executive and Chief Financial Officer commencing June 1,
1994. Includes consulting compensation in the amount of $47,667 for portion
of fiscal year from January 1, 1994 to June 1, 1994.
(2) Represents a one time bonus accrued for 1994 and paid during fiscal year
1995 representing the approximate combined federal and state tax associated
with the grant of 50,000 shares of Common Stock during fiscal 1994.
(3) On June 8, 1995, the Corporation granted Mr. Feigenbaum 100,000 restricted
shares of Common Stock. Represents the fair market value of the 100,000
shares based upon the market value of the Common Stock of $9.43 per share on
June 8, 1995. The restricted shares vest at the rate of 5,000 per year over
a twenty year period commencing December 31, 1995, subject to acceleration
of vesting under certain circumstances. Under the acceleration provisions,
full vesting was scheduled to occur at December 31, 1996. On December 2,
1996 the Corporation agreed to exchange the 95,000 shares that would have
otherwise become fully vested for warrants to acquire 300,000 shares of
Common Stock at $7.00 per share. See further description under "Employment
Agreements".
(4) Represents automobile insurance premiums paid by the Corporation.
(5) Represents automobile insurance premiums paid by the Corporation in the
amount of $5,500 and life insurance premiums in the amount of $1,044.
(6) Includes (i) $25,000 paid to Mr. Feigenbaum for issuing an accommodation
guaranty in the amount of $2.5 million for the benefit of the Corporation;
(ii) approximately $50,000 tax reimbursement paid to Mr. Feigenbaum for tax
on the value of 5,000 restricted shares of Common Stock which vested on
December 31, 1995, and which amount was paid in 1996; (iii) approximately
$68,000 reimbursement for taxes on taxes associated with the grant of 50,000
shares of Common Stock during fiscal 1994; and (iv) $62,686 withheld and
paid by the Corporation for taxes on taxes associated with the value of
5,000 restricted shares of Common Stock which vested on December 31, 1995.
(7) Represents automobile allowance, automobile insurance premiums and life
insurance premiums.
(8) On December 6, 1996, the Corporation granted Mr. Feigenbaum warrants to
acquire 200,000 shares of Common Stock at $10.875 per share. Such warrants
are fully vested and exercisable through December 5, 2001.
7
<PAGE> 10
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
(B) (C)
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/SARS (D)
UNDERLYING GRANTED TO EXERCISE OR
(A) OPTIONS/SARS EMPLOYEES IN BASE PRICE (E)
NAME GRANTED(#) FISCAL YEAR ($/SH) EXPIRATION DATE
-------------------------------------- ------------ ------------ ----------- ----------------
<S> <C> <C> <C> <C>
J. Marvin Feigenbaum.................. 300,000(1) 100% $ 7.00 December 1, 2001
200,000 $10.875 December 5, 2001
</TABLE>
- ---------------
(1) Represents options granted upon termination and cancellation of a restricted
stock grant as to 95,000 shares of Common Stock.
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTIONS/SAR VALUES
The following table summarizes options exercised by the named executive
officers during fiscal year 1996 and the number and value of options held by all
executive officers named in the Summary Compensation Table at year end. The
Corporation does not have any outstanding stock appreciation rights granted to
executive officers.
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED IN-THE-MONEY
OPTIONS AT FY-END OPTIONS AT FY-END ($)
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE REALIZED UNEXERCISABLE UNEXERCISABLE(1)
- ------------------------------- --------------- -------- --------------------- ---------------------
<S> <C> <C> <C> <C>
J. Marvin Feigenbaum(2)........ 0 0 650,000/0 $ 2,759,375/0
</TABLE>
- ---------------
(1) The average of the closing bid and closing asked prices for the
Corporation's Common Stock as reported on the Nasdaq SmallCap Market on
December 31, 1996, was $12.4375. Value is calculated on the basis of the
difference between the option exercise price and $12.4375 multiplied by the
number of shares of Common Stock underlying the options.
(2) Mr. Feigenbaum holds options and warrants to purchase 450,000 shares of
Common Stock with an exercise price of $7.00 per share, and warrants to
purchase 200,000 shares at $10.875.
Employment Agreements
On June 1, 1994, Mr. J. Marvin Feigenbaum was elected Chairman of the Board
of Directors, Chief Executive and Chief Financial Officer of both the
Corporation and ABC. Mr. Feigenbaum also serves as President, Chief Executive
and Chief Financial Officer of the Corporation and Chief Operating Officer of
Physicians Clinical Laboratory, Inc. ("PCL"). On September 22, 1994, Mr.
Feigenbaum entered into an Amended and Restated Employment Agreement with the
Corporation for a term of three years and six months commencing June 1, 1994
through November 30, 1997. Mr. Feigenbaum's Employment Agreement currently
provides for a salary at the rate of $196,000 per annum. In addition, Mr.
Feigenbaum is provided with health and other benefits and a policy of life
insurance in the amount of $500,000 payable to a beneficiary to be named by Mr.
Feigenbaum. He also receives an automobile allowance of $500 per month and
reimbursement for expenses incurred on behalf of the Corporation and in
connection with the performance of his duties. In connection with his Employment
Agreement as amended, Mr. Feigenbaum was issued, in lieu of a cash bonus for
past services rendered to the Corporation, while acting as a consultant to the
Corporation, 50,000 shares of Common Stock of the Corporation which has been
valued at $3.50 per share. All of said shares are immediately vested, and the
Corporation paid Mr. Feigenbaum, on April 14, 1995, a one time cash bonus equal
to $108,000 representing the amount of the combined federal and applicable state
and city income tax associated with such stock grant. In addition, Mr.
Feigenbaum was granted options to purchase 150,000 shares of the Corporation's
Common Stock exercisable commencing in June, 1995 through December 31, 2002 at
an option exercise price equal to the $7.00 per share. Mr. Feigenbaum's
Employment Agreement provides that in the event of a change in control of the
Corporation (as defined), Mr. Feigenbaum will be paid for the remainder of the
unexpired term of his Agreement plus an additional sum of $196,000.
8
<PAGE> 11
On June 8, 1995, the Corporation granted and issued to its President, Mr.
J. Marvin Feigenbaum, 100,000 restricted shares of its Common Stock, $.01 par
value (the "Restricted Shares"). On December 2, 1996, Mr. Feigenbaum agreed to
terminate this grant of Restricted Shares by exchanging 95,000 Restricted Shares
for warrants to purchase 300,000 shares of Common Stock of the Corporation at
$7.00 per share.
Mr. Feigenbaum additionally receives a salary of $104,000 per annum in his
capacity as Chief Operating Officer at PCL.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Feigenbaum, the Corporation's Chairman, Chief Executive Officer and a
Class 1 Director, serves as a member of the Board of Directors and Vice-Chairman
of Comprehensive Care Corporation, and is a member of its Compensation
Committee.
Mr. Street, a Class 3 Director, is Chairman, President and Chief Executive
Officer of Comprehensive Care Corporation. Mr. Street serves on the Stock Option
and Compensation Committees of the Board of Directors of the Corporation.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Corporation's subsidiary, ABC, borrowed $150,000 on February 11, 1993
and $100,000 on February 25, 1993 from the Small Business Loan Fund Corporation
("SBLFC"). Both loans bear interest at the rate of 5.4%, are secured by the
Corporation's accounts receivable, inventory and equipment and are to be repaid
over a five year period ending in February 1998. In conjunction with the above
loans, the Corporation issued a warrant to SBLFC for 2,857 shares of Common
Stock at an exercise price of $15.75 per share. Additional debt financing of
$250,000, $166,000 and $125,000 was received from SBLFC on April 19, 1993,
October 22, 1993, and February 14, 1994, respectively. These financings also
bear interest at 5.4%, are secured by the Corporation's accounts receivable,
inventory, equipment, and intangible assets (including patents) and are to be
repaid over five year periods from the respective loan dates. In conjunction
with the April 19, 1993 loan, the Corporation issued to SBLFC a warrant for
42,857 shares of Common Stock at an exercise price of $28.35 per share. The
proceeds of the SBLFC loans were used for working capital.
For information concerning the Amended Employment Agreement of J. Marvin
Feigenbaum, see "Executive Compensation -- Employment Agreements."
In connection with the payments made by the Corporation to Austin Financial
Services Inc., the Corporation obtained a secured loan from a third party lender
on December 2, 1996. This loan was personally guaranteed by the Corporation's
President, J. Marvin Feigenbaum. The lender was a significant creditor of PCL
and had agreed to the terms of the PCL Plan. On January 23, 1997, the
Corporation obtained a new loan from Michael Jesselson, who, individually and
with trusts for the benefit of members of his family, are significant
shareholders of the Corporation. This new loan was in the principal amount of $2
million, and the proceeds were used to repay the remaining balance on the
initial loan of $2.5 million, which the Corporation obtained to pay off Austin
Financial. The new loan bore interest at 7.5% per annum and was due and payable
60 days from the date of loan. The lender also received 5-year Common Stock
Purchase Warrants to purchase 100,000 shares of Common Stock at $11.50 per
share. On February 26, 1997, the new loan was repaid. The shares underlying
these warrants have been registered by the Corporation with the Securities and
Exchange Commission.
1994 INCENTIVE STOCK OPTION PLAN
On November 16, 1994 the stockholders of the Corporation approved the 1994
Incentive Stock Option Plan (the "Plan"). The Plan provides for the issuance of
up to 350,000 shares of the Corporation's Common Stock upon the exercise of
options granted to officers, directors, full time employees and consultants
rendering services to the Corporation. Under the terms of the Plan, options
granted thereunder will be designated as options which qualify for incentive
stock option treatment ("ISO's") under Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code"), or options which do not so qualify
("Non-ISO's"). Unless
9
<PAGE> 12
sooner terminated, the Plan will expire on August 1, 2004 and options may be
granted at any time or from time to time through such date. The purpose of the
Plan is to promote the interests of the Corporation and its stockholders by
strengthening the ability of the Corporation to attract and retain officers,
employees and consultants by furnishing suitable recognition of their ability to
contribute to the success of the Corporation and to align their interests and
efforts with the long term interest of the Corporation. The Plan succeeds the
Corporation's 1992 Incentive Stock Option Plan, which has been terminated except
for options to acquire 16,857 shares thereunder.
The Plan is administered by the Board of Directors or by a Stock Option
Committee designated by the Board of Directors (the "Plan Administrator"). The
Plan Administrator has the discretion to determine the eligible employees and
consultants to whom, and the times and the prices at which, options will be
granted; whether such options shall be ISO's or Non-ISO's; the periods during
which each option will be granted; and the number of shares subject to each
option. The Plan Administrator shall have full authority to interpret the Plan
and to establish and amend rules and regulations relating thereto.
Under the Plan, the exercise price of an option designated as an ISO shall
not be less than the fair market value of the Common Stock on the date the
option is granted. However, in the event an option designated as an ISO is
granted to a ten percent stockholder (as defined in the Plan) such exercise
price shall be at least 110% of such fair market value. Exercise prices of
Non-ISOs may not be less than 85% of such fair market value. The aggregate fair
market value of shares subject to an option designated as an ISO for which any
participant may be granted such an option in any calendar year, shall not exceed
$100,000 plus any unused carryovers (as defined in Section 422 of the Code) from
a prior year. The "fair market value" will be the closing Nasdaq bid price or,
if the Corporation's Common Stock is not quoted by Nasdaq, the low bid as
reported by the National Quotation Bureau, Inc. or a market maker of the
Corporation's Common Stock or, if the Common Stock is not quoted by any of the
above, by the Board of Directors acting in good faith.
Options may be granted under the Plan for such periods as determined by the
Plan Administrator; provided however that no option designated as an ISO granted
under the Plan shall be exercisable over a period in excess of ten years, or in
the case of a ten percent stockholder, five years. Options may be exercised in
whole at any time or in part from time to time. Options are not transferable
except to the estate of an option holder; provided, however, in the case of a
Non-ISO, and subject to Rule 16b-3 promulgated under Section 16 of the
Securities Exchange Act of 1934 (the "Exchange Act") and prevailing
interpretations thereunder by the staff of the Securities and Exchange
Commission, a recipient of a Non-ISO may, with the consent of the Plan
Administrator, designate a named beneficiary of the Non-ISO in the event of the
death of such recipient, or assign such Non-ISO.
Except as described below, the Plan Administrator may from time to time
amend the Plan as it deems proper and in the best interests of the Corporation
without further approval of the stockholders.
The Board of Directors and the Plan Administrator may not amend certain
features of the Plan without the approval of the Corporation's stockholders to
the extent such approval is required for compliance with Section 422 of the Code
with respect to ISO's, Section 162(m) of the Code with respect to Non-ISO's or
Rule 16b-3 promulgated under Section 16 of the Exchange Act with respect to
awards made to individuals subject to Section 16 of the Exchange Act. Such
amendments would include (a) increasing the maximum number of shares of Common
Stock that may be issued under the Plan, (b) materially modifying the
requirements as to eligibility for participation in the Plan, or (c) otherwise
materially increasing the benefits accruing to participants under the Plan.
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
On November 16, 1994, the stockholders of the Corporation adopted the
Non-Employee Director Stock Option Plan (the "Director Plan"). Options may be
granted under the Director Plan until August 1, 2004 to the Corporation's
non-employee directors (as defined). The Director Plan provides that each
non-employee director will automatically be granted an option to purchase 5,000
shares upon joining the Board of Directors (or, for those persons who are
directors on the date of approval of the Director Plan by the stockholders, on
such date).
10
<PAGE> 13
At the 1996 Annual Meeting, the shareholders of the Corporation approved an
amendment to the Non-Employee Director Stock Option Plan to increase the number
of shares of Common Stock authorized under the Director Plan from 75,000 shares
to 200,000 shares of Common Stock, and to increase the number of options granted
annually to each Non-Employee Director from 3,000 options per year to 8,000
options per year (on each anniversary of the initial date of service or of
approval, as the case may be). As of May 16, 1997, options to purchase 60,545
shares of Common Stock had been granted to Non-Employee Directors.
Under the terms of the Director Plan, the sum of the number of shares to be
received upon any grant multiplied by the fair market value of each share at the
time of grant may not exceed $75,000. All awards shall be reduced to the extent
they exceed such amount. The exercise price for options granted under the
Director Plan shall be 100% of the fair market value of the Common Stock on the
date of grant. Until otherwise provided in the Director Plan, the exercise price
of options granted under the Director Plan must be paid at the time of exercise,
either in cash, by delivery of shares of Common Stock of the Corporation or by a
combination of each. The term of each option is five years from the date of
grant, unless terminated sooner as provided in the Director Plan. The Director
Plan is administered by a committee of the Board of Directors composed of not
fewer than two persons who are officers of the Corporation (the "Committee").
The Committee has no discretion to determine which non-employee director will
receive options or the number of shares subject to the option, the term of the
option or the exercisability of the option. However, the Committee will make all
determinations of the interpretation of the Director Plan. Options granted under
the Director Plan do not qualify for incentive stock option treatment.
FINANCIAL INFORMATION
A copy of the Corporation's Annual Report on Form 10-KSB for the fiscal
year ended December 31, 1996 as filed with the Securities and Exchange
Commission has been furnished without the accompanying exhibits. The Corporation
shall furnish all exhibits to Stockholders without charge upon written request
therefor sent to David A. Sterling, Secretary, Nu-Tech Bio-Med, Inc., 55 Access
Road, Warwick, Rhode Island 02886. Each such request must set forth a good faith
representation that as of May 13, 1997 the person making the request was the
beneficial owner of Common Stock of the Corporation entitled to vote at the 1997
Annual Meeting of Stockholders.
OTHER MATTERS THAT MAY COME BEFORE THE MEETING
The Board of Directors has no present knowledge of any other matters to be
presented at the Annual Meeting of Stockholders. If any other matters should
properly be brought before the meeting, and any adjournment thereof, it is the
intention of the persons named in the accompanying Proxy Card to vote such Proxy
with respect to any other matter in accordance with their best judgment.
11
<PAGE> 14
PROPOSALS FOR 1998 ANNUAL MEETING
Any Stockholder desiring to make a proposal to be acted upon at the 1998
Annual Meeting of Stockholders must present such proposal to the Secretary of
the Corporation not later than January 16, 1998 in order for the proposal to be
considered for inclusion in the Corporation's Proxy Statement.
By Order of the Board of Directors
David A. Sterling
Secretary
May 16, 1997
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE AND RETURN
YOUR PROXY CARD PROMPTLY IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF THE
PROXY CARD IS MAILED IN THE UNITED STATES OF AMERICA.
12
<PAGE> 15
NU-TECH BIO-MED, INC.
ANNUAL MEETING OF STOCKHOLDERS
JUNE 20, 1997
PROXY
The undersigned hereby appoints J. MARVIN FEIGENBAUM proxy, with full
powers of substitution, to vote all shares of Common Stock of NU-TECH BIO-MED,
INC. owned by the undersigned at the Annual Meeting of Stockholders to be held
on June 20, 1997 and at any adjournments thereof, hereby revoking any proxy
heretofore given. The undersigned instructs such proxies to vote as follows:
I ELECTION OF DIRECTORS
FOR all Nominees listed WITHHOLD AUTHORITY
below (except as marked to vote for all
to the contrary below) / / nominees listed below / /
(Instruction: Please check appropriate box. To withhold authority for any
individual nominee, strike a line through the nominee's name in the list below.)
CLASS 1 DIRECTOR TO SERVE UNTIL 2000 ANNUAL MEETING
J. Marvin Feigenbaum Robert B. Fagenson
AND TO VOTE UPON ANY OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING OR ANY ADJOURNMENT THEREOF, all as described in the Proxy Statement
dated May 16, 1997, receipt of which is hereby acknowledged.
<PAGE> 16
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
PLEASE SIGN AND RETURN THE PROXY IN THE ENCLOSED ENVELOPE.
The proxy, who shall be present and acting, shall have and may exercise
all the powers hereby granted.
IF NO OTHER ELECTION IS MADE, THE SHARES REPRESENTED BY THIS
PROXY WILL BE VOTED FOR THE ELECTION OF THE TWO CLASS 1
DIRECTORS.
Said proxy will use his discretion with respect to any other matters
which properly come before the Annual Meeting.
Dated:_________________, 1997
-------------------------------
Signature
-------------------------------
Print Name
(Please date and sign exactly as name
appears at left. For joint accounts, each
joint owner should sign, Executors,
administrators, trustees, etc., should also
so indicate when signing.)
