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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
FILED BY THE REGISTRANT /X/ FILED BY A PARTY OTHER THAN THE REGISTRANT / /
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Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Definitive Proxy Statement
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
GENZYME CORPORATION
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
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:
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June 5, 1997
Dear Stockholder:
On June 12, 1997, Genzyme will be holding a special meeting of stockholders
at which you are being asked to approve several proposals: (i) a merger
agreement between Genzyme and PharmaGenics, Inc., providing for the acquisition
of PharmaGenics, Inc. in exchange for shares of a new Genzyme security ("GMO
Stock") that is intended to reflect the value and track the performance of the
Molecular Oncology Division ("GMO"), a new division to be established by the
Company; (ii) the redesignation of outstanding common stock, and (iii)
amendments to the Company's benefit plans to allow for the issuance of GMO
Stock.
This is a reminder to you that if you have not yet voted your proxy, you
should do so as soon as possible. Your vote is important to us.
We are requesting your favorable vote on these proposals. The acquisition
of PharmaGenics and the establishment of GMO is an important expansion for us in
a field where we know there is tremendous need and where we feel we have the
ability to make a significant contribution. This new tracking stock allows us to
focus and build our cancer programs in a dedicated division while maintaining
access to the corporation and its infrastructure. In addition, it provides
shareholders with a vehicle to specifically direct their investment in Genzyme.
The redesignation of Genzyme's classes of common stock and authorization
for 150 million shares of undesignated common stock are intended to give the
Genzyme Board of Directors a means to act quickly and definitively to complete
future acquisitions or to further divide the business of Genzyme into additional
divisions, in each case through the creation of a separate series of common
stock. Such actions could be undertaken without the delay and uncertainty caused
by the need to obtain stockholder approval for the creation of a new class of
common stock. As a result, the Genzyme Board believes that the undesignated
common stock would allow it to more efficiently enhance stockholder value.
We are also asking your approval for amendments to equity-based benefit
plans to authorize the issuance of GMO Stock. The addition of GMO Stock to these
plans is designed to incentivize employees who will be focused on building the
GMO business. The use of equity-based programs to compensate employees ties
their performance directly to the performance of the division - a direct
connection to shareholder interests.
As a company, we are also aware of the concerns of our shareholders with
regard to the dilutive effect of equity-based benefit plans. Over the past few
years, we have placed increasing limits on these programs to reflect your
concerns while striving to maintain our ability to attract and retain the best
qualified employees in an increasingly competitive industry. Specifically:
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o We have granted an increasing number of stock options that are performance
related. Performance related options have objectives that are based on
achieving specific revenue, profitability or stock price goals within
relatively short periods of time, all of which are consistent with
increasing shareholder value.
o 23% of General Division options outstanding are performance related grants.
7% of options outstanding are performance grants tied directly to specific
increases in the stock price.
o 16% of Tissue Repair Division options outstanding are performance related
grants, all of which are tied to increases in the stock price.
o Over the past four years, the Compensation Committee has reduced the number
of shares which may be granted to employees even though our employee base
has doubled, a recognition of the growing maturity of the Company.
o We will no longer grant options to all newly hired full time employees. New
hire grants will be made selectively in situations where, for competitive
reasons, a key person or key position is needed.
o In the Stock Purchase Plan program, the Genzyme Board has imposed limits
for the purchase of Tissue Repair Division Stock by employees. An employee
can contribute a maximum of 5% of salary (previously 15%) to the program,
and can only purchase $8,300 of market value (a maximum of 1,149 shares in
1997 under the existing enrollment) in Tissue Repair Stock. We intend to
impose limits on the purchase of GMO Stock similar to those currently in
place for Tissue Repair.
o Our current employment turnover rate is 12%, still well below the industry
average of 18%. Our employees are our greatest asset, and they are crucial
to our continued success and growth.
It is our hope that you will support these proxy proposals.
Sincerely,
/s/ Susan P. Cogswell
Director, Shareholder Relations
