SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
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[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
Bioanalytical Systems, Inc.
- -------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- ----------------------------------------------------------------------------
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BIOANALYTICAL SYSTEMS, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD FEBRUARY 18, 1999
To the Shareholders of Bioanalytical Systems, Inc.:
The Annual Meeting of Shareholders of Bioanalytical Systems, Inc. (the
"Company") will be held at the principal executive offices of the Company, 2701
Kent Avenue, West Lafayette, Indiana 47906 on Thursday, February 18, 1999 at
10:00 a.m. (EST) for the following purposes:
- - To elect directors of the Company to serve for a one-year term;
- - To ratify the selection by the Board of Directors of Ernst & Young LLP as
independent auditors for the Company for the fiscal year ending September
30, 1999; and
- - To transact such other business as may properly come before the meeting.
Holders of Common Shares of record at the close of business on December 31, 1998
are entitled to notice of and to vote at the Annual Meeting.
By Order of the Board of Directors,
/s/ Candice B. Kissinger
Candice B. Kissinger
Secretary
January 18, 1999
West Lafayette, Indiana
YOUR VOTE IS IMPORTANT. IF YOU DO NOT EXPECT TO ATTEND THE ANNUAL MEETING, OR IF
YOU DO PLAN TO ATTEND BUT WISH TO VOTE BY PROXY, PLEASE DATE, SIGN, AND PROMPTLY
MAIL THE ENCLOSED PROXY. A RETURN ENVELOPE IS PROVIDED FOR THIS PURPOSE.
<PAGE>
<PAGE>
BIOANALYTICAL SYSTEMS, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD FEBRUARY 18, 1999
GENERAL INFORMATION
This proxy statement is furnished in connection with the solicitation by the
Board of Directors of Bioanalytical Systems, Inc. (the "Company") of proxies to
be voted at the Annual Meeting of Shareholders to be held at 10:00 a.m. (EST) on
Thursday, February 18, 1999, and at any adjournment thereof. The meeting will be
held at the principal executive offices of the Company, 2701 Kent Avenue, West
Lafayette, Indiana, 47906. This proxy statement and the accompanying form of
proxy were first mailed to shareholders on or about January 20, 1999.
A shareholder signing and returning the enclosed proxy may revoke it at any time
before it is exercised by written notice to the Secretary of the Company. The
signing of a proxy does not preclude a shareholder from attending the meeting in
person. All proxies returned prior to the meeting will be voted in accordance
with the instructions contained therein. Any proxy not specifying to the
contrary will be voted (1) FOR the election of the nominees for director named
below, and (2) FOR the proposal to ratify the selection of Ernst & Young LLP as
independent auditors for the Company for the fiscal year ending September 30,
1999. Abstentions and broker non-votes are not counted for purposes of
determining whether a proposal has been approved.
As of the close of business on December 31, 1998, the record date for the Annual
Meeting, there were outstanding and entitled to vote 4,503,176 Common Shares of
the Company. Each outstanding Common Share is entitled to one vote. The Company
has no other voting securities. Shareholders do not have cumulative voting
rights.
A quorum will be present if a majority of the Common Shares are present, in
person or by proxy, at the meeting. The nominees for director will be elected by
a plurality of the votes cast, assuming a quorum is present. All other matters,
including the approval of the independent auditors, will be approved by a
majority of the votes cast.
A copy of the Annual Report of the Company, including financial statements and a
description of operations for the fiscal year ended September 30, 1998, has
preceded or accompanies this proxy statement. The financial statements contained
in that report are not incorporated by reference herein.
The solicitation of proxies is being made by the Company, and all expenses in
connection with the solicitation of proxies will be borne by the Company. The
Company expects to solicit proxies primarily by mail, but directors, officers
and regular employees of the Company may also solicit in person or by telephone.
Shareholder proposals to be considered for presentation to the 1999 Annual
Meeting of Shareholders must be submitted in writing and received by the Company
on or before August 1, 1999.
The mailing address of the principal offices of the Company is 2701 Kent Avenue,
West Lafayette, Indiana 47906.
<PAGE>
<PAGE>
BENEFICIAL OWNERSHIP OF COMMON SHARES
The following table sets forth certain data with respect to those persons known
by the Company to be the beneficial owners of five percent or more of the
outstanding Common Shares of the Company as of December 31, 1998, and also sets
forth such data with respect to each director of the Company, each officer
listed in the Summary Compensation Table, and all directors and executive
officers of the Company as a group. Except as otherwise indicated in the notes
to the table, each beneficial owner possesses sole voting and investment power
with respect to the Common Shares indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
SHARES SHARES
BENEFICIALLY BENEFICIALLY
OWNED(1) OWNED(1)
------------- ------------
NAME NUMBER PERCENT
------------- ------------
Primus Capital Fund II, L.P.
1375 E. Ninth Street
Suite 2700
Cleveland, Ohio 44114 470,250 10.4%
Middlewest Ventures II, L.P.
201 N. Illinois St.
Suite 300
Indianapolis, Indiana 46204 282,149 6.3%
Peter T. Kissinger(2) 1,279,155 28.4%
Ronald E. Shoup(3) 93,966 2.1%
Candice B. Kissinger(4) 1,279,155 28.4%
William E. Baitinger(5) 137,734 3.1%
Michael K. Campbell 27,086 .6%
John A. Kraeutler - -
W. Leigh Thompson - -
All executive officers
and directors as a group 1,784,450 38.9%
<FN>
____________
(1) Unless otherwise noted, all addresses are in care of the Company at 2701
Kent Avenue, West Lafayette, Indiana 47906.
(2) Includes (i) 252,309 Common Shares beneficially owned by Candice B.
Kissinger, the wife of Dr. Kissinger, and (ii) 595,904 Common Shares owned
jointly by Dr. and Mrs. Kissinger.
(3) Includes (i) 74,286 Common Shares owned jointly by Dr. Shoup and his wife
and (ii) 19,228 Common Shares issuable upon the exercise of options under the
1990 Employee Incentive Stock Option Plan exercisable within 60 days of December
31, 1998.
(4) Includes (i) 430,942 Common Shares beneficially owned by Peter T. Kissinger
and (ii) 595,904 Common Shares owned jointly by Dr. and Mrs. Kissinger.
(5) Includes 53,089 Common Shares owned jointly by Mr. Baitinger and his wife.
</TABLE>
<PAGE>
<PAGE>
1. ELECTION OF DIRECTORS
NOMINEES
The Bylaws of the Company provide for no fewer than seven and no greater than
nine directors, each of whom is elected for a one-year term. The terms of all
incumbent directors will expire at the Annual Meeting. The Board of Directors
has nominated all of the current directors for reelection at the Annual Meeting.
The directors nominated for reelection are: Peter T. Kissinger, Candice B.
Kissinger, Ronald E. Shoup, William E. Baitinger, Michael K. Campbell, John A.
Kraeutler and W. Leigh Thompson (collectively, the "Nominated Directors").
Unless authority to vote for the Nominated Directors is withheld, the
accompanying proxy will be voted FOR the election of the Nominated Directors.
However, the persons designated as proxies reserve the right to cast votes for
another person designated by the Board of Directors in the event any Nominated
Director will be unable or unwilling to serve. Proxies will not be voted for
more than seven nominees. Those nominees receiving at least a plurality of the
votes eligible to be cast will be elected to the Board of Directors.
The directors of the Company as of December 31, 1998 are as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Served as Term
Name Age Position Director Since Ends
- ------------------------- --- ---------------------------------- -------------- ----
Peter T. Kissinger, Ph.D. 54 Chairman of the Board; 1974 1999
President; Chief Executive Officer
Ronald E. Shoup, Ph.D. 47 President, Research Services Unit; 1991 1999
Vice President, Research and
Development; Director
Candice B. Kissinger 47 Vice President, International 1978 1999
Marketing; Secretary; Director
William E. Baitinger 65 Director 1979 1999
Michael K. Campbell 47 Director 1991 1999
John A. Kraeutler 50 Director 1997 1999
W. Leigh Thompson, Ph.D. 60 Director 1997 1999
</TABLE>
<PAGE>
<PAGE>
EXECUTIVE OFFICERS
The executive officers of the Company as of December 31, 1998 are as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Served as
Name Age Position Officer Since
- -------------------------- --- ------------------------------------- -------------
Peter T. Kissinger, Ph.D. 54 Chairman of the Board; 1974
President; Chief Executive Officer
Ronald E. Shoup, Ph.D. 47 President, Research Services Unit; 1983
Vice Pres., Research & Dev.; Director
Craig S. Bruntlett, Ph.D. 49 Vice President, 1992
Electrochemical Products
Donnie A. Evans 52 Vice President, Engineering 1988
Stephen Geary, Ph.D. 57 Vice President, United States 1992
Sales and Marketing
Candice B. Kissinger 47 Vice President, International 1981
Marketing; Secretary and Director
Lina L. Reeves-Kerner 48 Vice President, Human Resources 1995
Michael P. Silvon, Ph.D. 51 Vice President, Business Development 1997
James B. Spence 55 Managing Director, BAS Analytics Ltd. 1998
Denise M. Wallworth, Ph.D. 45 Managing Director, BAS Technicol Ltd. 1995
Douglas P. Wieten 37 Chief Financial Officer, 1992
Controller and Treasurer
</TABLE>
BUSINESS EXPERIENCE OF DIRECTORS AND EXECUTIVE OFFICERS
PETER T. KISSINGER, PH.D. founded the Company in 1974 and has served as its
Chairman, President and Chief Executive Officer since 1974. He is also a
part-time Professor of Chemistry at Purdue University where he has been teaching
since 1975. Dr. Kissinger has a Bachelor of Science degree in Analytical
Chemistry from Union College and a Doctorate in Analytical Chemistry from the
University of North Carolina.
RONALD E. SHOUP, PH.D. has been Vice President, Research and Development since
1983 and President of the Company's research services unit, BAS Analytics, since
1990. Dr. Shoup has been instrumental in developing many of the Company's
chromatographic applications. Dr. Shoup has a Bachelor of Science degree in
Chemistry and Mathematics and a Ph.D. in Analytical Chemistry from Purdue
University.
CRAIG S. BRUNTLETT, PH.D. has been Vice President, Electrochemical Products
since 1992 and is responsible for sales, marketing and development of the
Company's electrochemical products. From 1980 to 1990, Dr. Bruntlett was
Director of New Product Development for the Company. Dr. Bruntlett has a
Bachelor of Arts degree in Chemistry and Mathematics from St. Cloud State
University in Minnesota and a Ph.D. in Chemistry from Purdue University.
<PAGE>
<PAGE>
DONNIE A. EVANS was the Company's first full-time employee, beginning as an
electronics engineer in 1978. Since January of 1988, he has been Vice President,
Engineering Services.
STEPHEN GEARY, PH.D. has been Vice President, United States Sales and Marketing
since January 1992. Dr. Geary is responsible for the sales efforts of the
Company's clinical products. Dr. Geary has a Bachelor of Science degree in
Biology and Chemistry from Tufts University, a Master of Science degree in
Biology from the University of New Hampshire and a Ph.D. in Biochemistry from
Syracuse University.
CANDICE B. KISSINGER has been Vice President, International Sales and Marketing
since July 1981. Mrs. Kissinger developed the Company's international
distribution network and is responsible for managing the Company's advertising
activities. Mrs. Kissinger has a Bachelor of Science degree in Microbiology from
Ohio Wesleyan University and a Master of Science degree in Food Science from the
University of Massachusetts. Mrs. Kissinger is the wife of Dr. Peter T.
Kissinger.
LINA L. REEVES-KERNER has been Vice President, Human Resources since 1995 and is
responsible for the administrative support functions of the Company, including
shareholder relations, human resources and community relations. From 1980 to
1990 Ms. Reeves-Kerner served as an Administrative Assistant with the Company.
Ms. Reeves-Kerner has a Bachelor of Science degree in Business Administration
from Indiana Wesleyan University.
MICHAEL P. SILVON, PH.D. has been Vice President, Business Development since
March 1997. From August 1996 until January 1997, Dr. Silvon was Manager,
Technical Services for Great Lakes Chemical responsible for commercial technical
support. From December 1994 until August 1996, Dr. Silvon was a self-employed
consultant. From October 1993 until December 1994, Dr. Silvon was Vice President
Sales and Marketing at Hi-Port, Inc., a custom formulations firm in Houston,
Texas. Prior to that time, Dr. Silvon was a Regional Business Manager-Americas
for Zeneca, responsible for outsourcing the needs of major pharmaceutical
companies with key raw materials. Dr. Silvon has his Bachelor in Science in
Chemistry from Loyola University of Chicago, a Ph.D. in Chemistry from the
University of Vermont and a Master of Business Administration from Sacred Heart
University.
JAMES B. SPENCE has been Managing Director, BAS Analytics Ltd., since July 1998.
Since 1990 he had been Managing Director of Clinical Innovations, which was
acquired by the Company in July 1998. Mr. Spence was made a Fellow of the
Institute of Medical Laboratory Sciences in 1966.
DENISE M. WALLWORTH, PH.D. has been Managing Director, BAS Technicol Ltd. since
March 1995 and is responsible for the Company's operations in the United
Kingdom. Prior to that time she was Managing Director of Technicol Ltd., which
was acquired by the Company in March 1995. Dr. Wallworth has a Bachelor of
Science degree in Chemistry and a Doctorate in Organic Chemistry from the
University of Manchester Institute of Science Technology.
DOUGLAS P. WIETEN has been Chief Financial Officer since September 1997,
corporate Controller since February 1992 and Treasurer since March 1997 and is a
certified public accountant. Prior to that time, Mr. Wieten worked at Ernst &
Whinney (now Ernst & Young LLP), where he had been employed since 1984. Mr.
Wieten has a Bachelor of Science degree in Accounting from Butler University.
<PAGE>
<PAGE>
WILLIAM E. BAITINGER has served as a director of the Company since 1979. Mr.
Baitinger has been Director of Technology Transfer at Purdue University since
1988, responsible for all aspects of the program. Mr. Baitinger has a Bachelor
of Science degree in Chemistry and Physics from Marietta College and a Master of
Science degree in Chemistry from Purdue University.
MICHAEL K. CAMPBELL has served as a director of the Company since 1991. Mr.
Campbell has been the President and Chief Executive Officer of Powerway, Inc., a
software company, since January 1993. From January 1992 until January 1993, Mr.
Campbell was Chief Financial Officer of Hurco Companies, Inc. and was president
of Hurco Manufacturing, its largest division. Mr. Campbell has a Bachelor of
Science degree in accounting from the University of Southern Indiana.
JOHN A. KRAEUTLER has served as a director of the Company since January 1997.
Mr. Kraeutler has been President and Chief Operating Officer of Meridian
Diagnostics, Inc. since August 1992 and is also a director. Prior to that time,
Mr. Kraeutler was Executive Vice President and Chief Operating Officer of
Meridian Diagnostics, Inc. Mr. Kraeutler has a Bachelor of Science degree in
Biology from Fairleigh Dickinson University as well as a Master of Science
degree in Biology and a Master of Business Administration from Seton Hall
University.
W. LEIGH THOMPSON, PH.D., M.D., has served as a director of the Company since
January 1997. Since 1995, Dr. Thompson has been chief executive officer of
Profound Quality Resources, Inc., a scientific consulting firm. Prior to 1995,
Dr. Thompson held various positions at Lilly Research Laboratories. Dr. Thompson
has a Bachelor of Science degree in Biology from the College of Charleston, a
Master of Science and a Doctorate in Pharmacology from the Medical University of
South Carolina and a Medical Doctor degree from The Johns Hopkins University.
Dr. Thompson is also a director of Chrysalis International Corporation, Corvas
International, Inc., GeneMedicine, Inc., La Jolla Pharmaceutical Company,
Medarex, Inc., Ophidian Pharmaceuticals, Inc. and Orphan Medical, Inc.
SCIENTIFIC ADVISORY BOARD
In 1985, the Company established a Scientific Advisory Board to assist the
Company in its research and development activities. The Scientific Advisory
Board is comprised of distinguished scientists from outside the Company who have
significant accomplishments in areas of science and technology that are
important to the Company's future. The Scientific Advisory Board interacts with
the Company's scientific and management staff.
Each of the Scientific Advisory Board members is employed outside the Company
and may have commitments to, or consulting or advisory contracts with, other
entities that may conflict or compete with his or her obligations with the
Company. Generally, members of the Scientific Advisory Board are not expected to
devote a substantial portion of their time to Company matters.
Members of the Scientific Advisory Board do not receive any compensation in
connection with attending meetings of the Scientific Advisory Board. They do,
however, from time to time, receive compensation in connection with consulting
services they render to the Company. In fiscal 1998 Dr. Thompson received $4,800
for consulting service rendered to the Company, and no other member of the
Scientific Advisory Board received fees for consulting services.
<PAGE>
<PAGE>
FAMILY RELATIONSHIPS
Peter T. Kissinger and Candice B. Kissinger are husband and wife. There is no
other family relationship among the directors and executive officers of the
Company.
COMPENSATION OF DIRECTORS
Directors who are not employees of the Company receive $800 for each Board
meeting attended, plus out-of-pocket expenses incurred in connection with
attendance at such meetings. Directors of the Company or an affiliate of the
Company who are not employed by the Company or any affiliate may also
participate in the Company's Outside Director Stock Option Plans, as may be
selected from time to time by the Compensation Committee. Dr. Thompson received
an additional $4,800 as compensation for the services he rendered as a
consultant to the Company. Directors who are employees of the Company do not
receive any additional compensation for their services as directors.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors has established a Compensation and Incentive Stock Option
Committee, an Audit Committee and an Executive Committee. The Compensation and
Incentive Stock Option Committee of the Board of Directors (the "Compensation
Committee") is comprised of Peter T. Kissinger and John A. Kraeutler. The
responsibilities of the Compensation Committee include making recommendations to
the Board of Directors with respect to: compensation arrangements for the
executive officers of the Company; policies relating to salaries and job
descriptions; insurance programs; and benefit programs of the Company, including
its retirement plans. The Compensation Committee administers the 1990 and 1997
Employee Incentive Stock Option Plans. The Compensation Committee met one time
during fiscal 1998.
The Audit Committee of the Board of Directors is comprised of William E.
Baitinger and Michael K. Campbell. The Audit Committee reviews with the auditors
the scope of the audit work performed, audit practices, any questions arising in
the course of the audit work and inquiries as to other pertinent matters such as
internal accounting controls, financial reporting, security and personnel
staffing. The committee met twice during fiscal 1998.
The Executive Committee is comprised of Messrs. Kissinger, Shoup, Baitinger,
Kraeutler and Thompson. The Executive Committee may exercise all of the
authority of the Board of Directors, subject to certain limitations with respect
to payment of dividends, filling of vacancies on the Board, amendment of the
Articles of Incorporation or Bylaws, and issuance of shares.
The Board of Directors has no nominating committee. The Board of Directors will
consider for nomination as directors persons recommended by shareholders. Such
recommendations must be in writing and delivered to the Secretary, Bioanalytical
Systems, Inc., 4701 Kent Avenue, West Lafayette, Indiana 47906.
The Board of Directors met four times during fiscal 1998. No director attended
fewer than 75% of the meetings of the Board of Directors and meetings of any
committee of the Board of Directors of which he or she was a member.
<PAGE>
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following Summary Compensation Table sets forth certain information with
respect to the aggregate compensation paid during each of the last three years
to the Company's President and Chief Executive Officer and each of the other
executive officers of the Company whose salary and bonus exceeded $100,000
during fiscal 1998 (the "Named Executive Officers").
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Fiscal All Other
Year Salary Bonus Compensation
------ ------- ------- --------------
Peter T. Kissinger, Ph.D 1998 $85,000 $ - $ 26,893(1)
Chairman of the Board; President 1997 $85,000 $21,250 $ 25,380(1)
and Chief Executive Officer 1996 $85,000 $ 4,250 $ 26,788(1)
Ronald E. Shoup, Ph.D 1998 $92,500 $ - $ 6,177(2)
President, Research Services Unit; 1997 $84,254 $22,500 $ 4,850(2)
Vice President, Research and 1996 $78,431 $ 3,932 $ 5,113(2)
Development; Director
<FN>
(1) Includes $20,865 of premiums paid on a life insurance policy on the lives
of Dr. Kissinger and Mrs. Kissinger, the beneficiary of which is a trust
established for their benefit, and contributions to the Company's 401(k) plan on
Dr. Kissinger's behalf.
(2) Represents contributions to the Company's 401(k) plan on Dr. Shoup's
behalf.
</TABLE>
OPTIONS
A total of 95,000 Common Shares have been reserved for issuance under the
Company's 1997 Employee Incentive Stock Option Plan and a total of 5,000 Common
Shares have been reserved for issuance under the Company's 1997 Outside Director
Stock Option Plan, of which options to purchase an aggregate of 35,000 and 4,000
Common Shares, respectively, have been granted at an exercise price of $8.00. In
addition, at the date of this Proxy Statement options to purchase a total of
119,486 Common Shares were outstanding under the 1990 Employee Incentive Stock
Option Plan at a weighted average exercise price of $1.18 per share, and no
Common Shares were outstanding under the 1990 Outside Director Stock Option
Plan. No further options may be granted under the 1990 Employee Incentive Stock
Option Plan or the 1990 Outside Director Stock Option Plan.
The following table sets forth certain information concerning grants of stock
options to each of the Named Executive Officers during fiscal 1998.
<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
<S> <C> <C> <C> <C> <C> <C>
Potential Potential
Realizable Value Realizable Value
Number of % of Total at Assumed at Assumed
Securities Options Annual Rates of Annual Rates of
Underlying Granted to Exercise Stock Price Stock Price
Options Employees Price Expiration Appreciation for Appreciation for
Granted in Year ($/Share) Date Option Term Option Term
---------- ----------- --------- ---------- ------------------ ------------------
5% 10%
------------------ ------------------
Peter T. Kissinger, Ph.D. - - - - - -
Ronald E. Shoup, Ph.D. 4,000 11.4% 8.00 11/24/2007 $ 20,120 $ 51,000
</TABLE>
<PAGE>
<PAGE>
The following table sets forth certain information concerning exercisable and
unexercisable options held by the Named Executive Officers at September 30,
1998.
<TABLE>
<CAPTION>
Aggregated Option Exercises In Last Year And Fiscal Year-End Option Values
<S> <C> <C> <C> <C> <C> <C>
Number of Number of
Securities Securities
Shares Underlying Underlying Value of
Acquired Options at Options at Unexercised
on Exercise Value September 30, September 30, In-the-Money September 30,
(#) Realized 1998 1998 Options at 1998(1)
------------ --------- ------------- ------------- ------------- --------------
Exercisable Unexercisable Exercisable Unexercisable
------------- ------------- ------------- --------------
Peter T. Kissinger, Ph.D. 54,172 $310,406 - - - -
Ronald E. Shoup, Ph.D. 2,300 $16,307 22,528 4,000 $89,065 -
<FN>
(1) Calculated on the basis of $5.375 per share, which was the closing price of the Common Shares as reported
on the NASDAQ National Market System on September 30, 1998.
</TABLE>
401(K) SAVINGS PLAN
The Company has a defined contribution retirement plan (the "401(k) Plan"),
qualified under Sections 401(a) and 401(k) of the Code. All employees of the
Company are eligible to enroll in the 401(k) Plan on the first April 1 or
October 1 after completing one year of employment with the Company. The 401(k)
Plan provides that the Company will contribute 2% of each eligible employee's
compensation to the 401(k) Plan. In addition, each participant may contribute
from 1% to 10% or none of their annual compensation. The Company may also make
discretionary contributions based on a certain percentage of a participant's
contributions under the 401(k) Plan, as determined by the Board of Directors.
The Board approved a matching contribution of 38% beginning October 1, 1997.
Contribution expense for the 401(k) Plan was $187,896 for the year ended
September 30, 1998.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Peter T. Kissinger and John A. Kraeutler serve on the Compensation Committee.
Dr. Kissinger, the President and Chief Executive Officer of the Company, does
not participate in decisions regarding his compensation. None of the Company's
executive officers serves as a director of, or in any compensation-related
capacity for, companies with which members of the Compensation Committee are
affiliated.
<PAGE>
<PAGE>
REPORT OF THE COMPENSATION AND INCENTIVE STOCK OPTION COMMITTEE
The Compensation and Incentive Stock Option Committee of the Board of Directors
(the "Compensation Committee") has responsibility for the Company's executive
compensation program. The Compensation Committee is currently comprised of Peter
T. Kissinger and John A. Kraeutler. The following report is submitted by the
members of the Compensation Committee.
The Company's executive compensation program is designed to align executive
compensation with financial performance, business strategies and Company values
and objectives. The Company's compensation philosophy is to ensure that the
delivery of compensation, both in the short and long term, is consistent with
the sustained progress, growth and profitability of the Company and acts as an
inducement to attract and retain qualified individuals. This program seeks to
enhance the profitability of the Company, and thereby enhance shareholder value,
by linking the financial interests of the Company's executives with those of its
long-term shareholders. Under the guidance of the Company's Compensation
Committee of the Board of Directors, the Company has developed and implemented
an executive compensation program to achieve these objectives while providing
executives with compensation opportunities that are competitive with companies
of comparable size in related industries.
The Company's executive compensation program has been designed to implement the
objectives described above and is comprised of the following fundamental
elements:
- A base salary that is determined by individual contributions and
sustained performance within an established competitive salary range.
Pay for performance recognizes the achievement of financial goals,
accomplishment of corporate and functional objectives, and performance
of individual business units of the Company.
- Grants of options under the Company's option plans that reward executives
when shareholder value is created through increase in the market value
of the Company's Common Shares. Stock option grants focus executives on
managing the Company from the perspective of an owner with an equity
position in the business.
BASE SALARY. The salary, and any periodic increase thereof, of the President and
Chief Executive Officer were and are determined by the Board of Directors of the
Company based on recommendations made by the Compensation Committee, excluding
Dr. Kissinger. The salaries, and any periodic increases thereof, of all other
executive officers were and are determined by the Board of Directors based on
Committee recommendations.
The Company, in establishing base salaries, levels of incidental and/or
supplemental compensation, and incentive compensation programs for its officers
and key executives, assesses periodic compensation surveys and published data
covering the Company's industry and industry in general. The level of base
salary compensation for officers and key executives is determined by both their
scope of responsibility and the established salary ranges for officers and key
executives of the Company. Periodic increases in base salary are dependent on
the executive's proficiency of performance in the individual's position for a
given period and on the executive's competency, skill and experience.
Compensation levels for fiscal 1998 for the President and Chief Executive
Officer, and for the other executive officers of the Company, reflected the
positive performance of the Company in fiscal 1997 as well as the accomplishment
of corporate and functional objectives.
<PAGE>
<PAGE>
OPTION PLANS. Granting of options pursuant to the Company's option plans is
intended to align executive interest with the long-term interests of
shareholders by linking executive compensation with enhancement of shareholder
value. In addition, grants of options motivate executives to improve long-term
stock market performance by allowing them to develop and maintain a significant
long-term equity ownership position in the Company's Common Shares. A total of
62,000 shares were granted December 11, 1998 under the 1997 Employee Incentive
Stock Option Plan.
Respectfully submitted,
Peter T. Kissinger
John A. Kraeutler
STOCK PRICE PERFORMANCE GRAPH
The line graph below compares yearly percentage change in the cumulative total
stockholder return on the Company's Common Stock against the cumulative total
return on the Nasdaq Composite Index and a composite index based on a group of
ten publicly traded contract research and chemical instrumentation organizations
(the "Peer Group Index") for the period commencing November 24, 1997, the date
of the Company's initial public offering, and ending September 30, 1998.
The Peer Group Index is comprised of Applied Analytical Industries; Bioreliance
Corporation; CEM Corporation; Clintrials Research, Inc.; Collaborative Clinical
Research, Inc.; Hach Company; Isco, Inc.; Molecular Devices Corporation; OI
Corporation; and Premier Research Worldwide, Ltd. The comparison of total return
on investment (change in year end stock price plus reinvested dividends) for the
applicable period assumes that $100 was invested on November 24, 1997, in each
of Bioanalytical Systems, Inc. (at the initial public offering price), the
Nasdaq Composite Index and the Peer Group Index.
<TABLE>
<CAPTION>
Comparison of Cumulative Total Return
Among Bioanalytical Systems, Inc., the NASDAQ
Composite Index, and the Peer Group Index
<S> <C> <C>
11/24/97 9/30/98
--------- --------
NASDAQ $ 100 $ 106.73
PEER Group $ 100 $ 79.24
Bioanalytical Systems, Inc. $ 100 $ 67.19
</TABLE>
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COMPLIANCE WITH REPORTING REQUIREMENTS OF SECTION 16(A)
OF THE SECURITIES AND EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 required the Company's
directors and executive officers, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file with the Securities
and Exchange Commission (the "SEC") initial reports of ownership and reports of
changes in ownership of Common Stock and other equity securities of the Company.
Officers, directors and greater than ten-percent shareholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) reports
they file. To the knowledge of the Company, all Section 16(a) filing
requirements applicable to the Company's officers, directors and greater than
ten-percent beneficial owners have been made in a timely manner.
2. RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
Subject to ratification by the shareholders, the Board of Directors has selected
Ernst & Young LLP as independent auditors for the Company for the fiscal year
ending September 30, 1999. The Company has been advised by such firm that
neither it nor any of its associates has any direct or material indirect
financial interest in the Company.
Ernst & Young LLP has acted as independent auditors for the Company since 1994.
Representatives of Ernst & Young LLP are expected to be present at the Annual
Meeting, will have the opportunity to make a statement if they desire to do so,
and will be available to respond to appropriate questions concerning the audits
of the Company's financial statements.
3. OTHER MATTERS
As of the date of this proxy statement, the Board of Directors of the Company
has no knowledge of any matters to be presented for consideration at the Annual
Meeting other than those referred to above. If (a) any matters not within the
knowledge of the Board of Directors as of the date of this proxy statement
should properly come before the meeting; (b) a person not named herein is
nominated at the meeting for election as a director because a nominee named
herein is unable to serve or for good cause will not serve; (c) any proposals
properly omitted from this proxy statement and the form of proxy should come
before the meeting; or (d) any matters should arise incident to the conduct of
the meeting, then the proxies will be voted in accordance with the
recommendations of the Board of Directors of the Company.
By Order of the Board of Directors,
/s/ Candice B. Kissinger
Candice B. Kissinger
Secretary
January 18, 1999
