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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
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[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[X] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-2.
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Bio-Imaging Technologies, Inc.
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(Name of Registrant as Specified In Its Charter)
Bio-Imaging Technologies Independent Shareholders' Committee
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(Name of Person(s) Filing Proxy Statement, if other than Registrant)
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THE BIO-IMAGING TECHNOLOGIES
INDEPENDENT SHAREHOLDERS' COMMITTEE
c/o Bryan, Levitin & Bab, L.L.P.
330 Madison Avenue
New York, NY 10017
February 6, 1998
Fellow Shareholders:
We are substantial shareholders of Bio-Imaging Technologies who have
formed the BIO-IMAGING TECHNOLOGIES SHAREHOLDERS' COMMITTEE for the purpose of
electing a slate of new Directors of the Company at the upcoming Annual Meeting
currently scheduled for February 27, 1998.
On December 19, 1997 the Board of Directors without warning fired
executive management and the value of your stock and ours plummeted over 60%.
We urge you to read the enclosed letter which describes our concern
that the value of our investment may be permanently impaired by the actions
taken by the current board.
You have received a proxy card from the Company asking that you elect
three directors: Legal Counsel of Covance who owns no shares, and two directors
who own minimal shares. These directors do not deserve your vote.
We are asking that you withhold submitting your proxy card until we can
furnish you with our Proxy Statement and list of nominees, which will be mailed
to you shortly. In the meantime if you wish to communicate with us, we will
welcome your call at (800)-845-6487 or email us at
[email protected]
THE BIO-IMAGING TECHNOLOGIES
INDEPENDENT SHAREHOLDERS' COMMITTEE
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PLEASE DO NOT SIGN YOUR PROXY CARDS UNTIL
YOU READ THIS LETTER AND RECEIVE OUR PROXY
MATERIAL.
BIO-IMAGING TECHNOLOGIES, INC.
INDEPENDENT SHAREHOLDERS' COMMITTEE
c/o Bryan, Levitin & Bab L.L.P.
330 Madison Avenue
New York, NY 10017
February 6, l998
To Fellow Shareholders of Bio-Imaging Technologies, Inc.:
As substantial shareholders, we want to express our concern about the
recent management and strategic business changes made by the Bio-Imaging
Technologies, Inc. (Bio-Imaging) Board of Directors. Because of our concern, we
have formed an Independent Shareholders' Committee, and we intend to offer an
independent slate of nominees for Directors.
THE PAST TWO YEARS OF GROWTH.
Two years ago, Bio-Imaging senior management met to develop a strategic
plan for the Company. The participants identified biomedical information
technology as the core competence of the Company to be exploited. Two objectives
were agreed upon at this meeting:
- Increase Bio-Imaging revenues and profit
- Increase Bio-Imaging market valuation
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The primary emphasis in the past two years has been increasing revenues
and profitability. The eight consecutive quarters of profitability demonstrate
the improved financial performance of the Company.
To quote from the Annual Report:
"Fiscal 1997 was a successful year of growth for Bio-Imaging
Technologies. We set new records for both revenues and profits and
strengthened our balance sheet. Revenues climbed 52% to $5.5 million,
and net income improved 107% to $0.8 million. Shareholders' equity
increased 93% to $4.6 million. During the year the Company's margins
improved despite increased pricing pressure.
PRIOR MANAGEMENT'S 1997 PLAN FOR INTEGRATED SERVICES.
In early 1997, senior management saw that clients preferred a single
point of service, (i.e., an integrated service provider), to a single core
business, such as Bio-Imaging, even though the Company's imaging technology was
superior to that of most competitors.
As a consequence, senior management negotiated strategic relationship
agreements with distinguished contract research organizations ("CROs"), in order
to be able to offer the integrated services that its clients were looking for
and that its competitors were increasingly providing. By December 1997, four
prestigious CROs were prepared to sign such strategic agreements with
Bio-Imaging.
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On December 19, 1997, without notice or warning, the Board of
Directors, dominated by Covance, Inc., (formerly Corning Pharmaceutical
Services, Inc.) discharged Messrs. James Conklin, the Company founder, and
Donald Lohin, the Chief Executive Officer, the two senior officers principally
responsible for the Company's growth in services and income, for the development
and implementation of the integrated service plan and for negotiating the
strategic partnering agreements with the CRO's.
In its April 1997 Registration Statement the Company said the following
about Messrs, Conklin and Lohin under the caption "Risk Factors":
The success of the Company is largely dependent upon the efforts of
its key personnel, including James J. Conklin, M.D., its Chairman and Chief
Scientific Officer, and Donald W. Lohin its President and Chief Executive
Officer, the loss of either of whom would likely have a material adverse impact
on the Company.
We are concerned that the plans previously initiated to expand through
strategic alliances are now being abandoned and the momentum developed over the
last two years by senior management to build an independent franchise may be
lost because of loss of confidence by clients and potential partners.
COVANCE'S ROLE.
We believe that the December discharge of senior management, and the
present control of the Bio-Imaging Board of Directors by Covance, will ensure
that Bio-Imaging never reaches its full potential.
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Covance's principal business is in providing contract research
services. Since 1994, Covance, a substantial shareholder in the Company, has
provided only minimal business to Bio-Imaging.
In late 1994, at the time Covance invested in the Company, it entered
into an exclusive marketing agreement with Bio-Imaging. A year later, Covance
advised the Company that it would not pay the approximately $500,000 then due
under the Exclusive Marketing Agreement, and proposed a new Agreement which
provided that the Company would be obligated to deal exclusively with Covance -
but Covance would not be obligated to deal exclusively with Bio-Imaging.
The Company would not agree to this demand and therefore the Marketing
Agreement was terminated. Bio-Imaging has never received any significant
business from Covance.
DISCUSSIONS WITH COVANCE.
In December 1997 and January 1998, a member of the undersigned
shareholders' committee had discussions with Covance about including two of such
member's nominees in the slate presented to the shareholders at the February
27th meeting. Covance advised that it preferred to appoint the nominees to the
Board after the shareholders meeting, rather than include them in the Company's
slate. The Company's proxy material was mailed on January 30, 1998, without any
disclosure to the shareholders of the additional nominees.
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The Shareholders committee (1) believes that Covance's dominant role on
the Company's Board adversely affects the Company's operations and our interest
as shareholders. The change of the Company's strategic direction and the removal
of senior management who have been principally responsible for the growth and
success of the Company over the last two years, are not in the best interest of
the Company and its other stockholders.
Bio-Imaging needs a stronger management than the management in place
since December 19, 1997 and a more independent and experienced Board of
Directors. To that end, the Shareholder Group intends to submit a slate of
nominees for the Board which will include Mr. James Conklin, the founder of the
Company and, until December 19th, the principal scientific officer. The proposed
slate will include nominees experienced in investment management, venture
capital, executive management and in the pharmaceutical, medical and scientific
fields.
We ask you to withhold submitting your proxy card for the February 27th
meeting, until we can furnish you with our Proxy Statement and Card, which we
are in the process of preparing.
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(1)
The Shareholder Committee, and their shareholdings, consist of James
Conklin, 333,200 shares of common stock and options to purchase 280,667
shares; J.A. Cole, Jr., 162,500 shares of common stock; Marc Berger,
64,100 shares of common stock; Frank J. Abella, Jr., 19,400 shares of
common stock and 18,056 shares of Class A preferred stock (a
partnership in which Mr. Abella is a general partner owns an additional
2,332 shares of common and 4,666 shares of Class A preferred stock and
holds warrants to purchase 66,667 shares of common stock. Mr. Abe11a
disclaims beneficial ownership of the securities owned by the
partnership.); and Richard Dumler, 5,000 shares of common stock.
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In the meantime, if any shareholder wants to communicate with us, we would
welcome telephone calls to 1-800-845-6487.
Very truly yours,
BIO-IMAGING TECHNOLOGIES,
INDEPENDENT SHAREHOLDERS COMMITTEE
JAMES CONKLIN JAMES A. COLE, JR. FRANK ABELLA
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James Conklin James A.Cole, Jr. Frank Abella
MARC BERGER RICHARD DUMLER
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Marc Berger Richard Dumler
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