<PAGE>
===============================================================================
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:
[ ] 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-12
Biosource International Inc.
- --------------------------------------------------------------------------------
(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
BIOSOURCE INTERNATIONAL, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held July 17, 1998
TO THE STOCKHOLDERS OF
BIOSOURCE INTERNATIONAL, INC.:
You are cordially invited to attend the Annual Meeting of Stockholders (the
"Annual Meeting") of BioSource International, Inc. (the "Company"), which will
be held at the Spanish Hills Country Club, 999 Crestview Avenue, Camarillo,
California 93010, on Friday, July 17, 1998, at 10:00 a.m. Pacific time, to
consider and act upon the following matters:
1. The election of directors;
2. To ratify the appointment of KPMG Peat Marwick LLP as the Company's
independent public accountants for the year ending December 31, 1998;
and
3. To transact such other business as may properly come before the Annual
Meeting or any adjournments of the Annual Meeting.
Only holders of record of Common Stock of the Company at the close of
business on June 3, 1998 will be entitled to notice of and to vote at the Annual
Meeting and any adjournments of the Annual Meeting.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING
REGARDLESS OF THE NUMBER OF SHARES YOU HOLD. YOU ARE INVITED TO ATTEND THE
ANNUAL MEETING IN PERSON, BUT WHETHER OR NOT YOU PLAN TO ATTEND, PLEASE
COMPLETE, DATE, SIGN AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE.
IF YOU DO ATTEND THE ANNUAL MEETING, YOU MAY, IF YOU PREFER, REVOKE YOUR PROXY
AND VOTE YOUR SHARES IN PERSON.
By Order of the Board of Directors
/s/ James H. Chamberlain
James H. Chamberlain
Chairman of the Board,
President and Chief Executive Officer
820 Flynn Road
Camarillo, California 93012
(805) 987-0086
June 4, 1998
<PAGE>
BIOSOURCE INTERNATIONAL, INC.
_________________
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JULY 17, 1998
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of BioSource International, Inc., a Delaware
corporation (the "Company"), for use at the Annual Meeting of Stockholders to be
held at the Spanish Hills Country Club, 999 Crestview Avenue, Camarillo,
California 93010, on Friday, July 17, 1998, at 10:00 a.m. Pacific time.
Accompanying this Proxy Statement is the Board of Directors' Proxy for the
Annual Meeting, which you may use to indicate your vote as to the proposals
described in this Proxy Statement.
All Proxies which are properly completed, signed and returned to the
Company prior to the Annual Meeting, and which have not been revoked, will be
voted in favor of the proposals described in this Proxy Statement unless
otherwise directed. A stockholder may revoke his or her Proxy at any time
before it is voted either by filing with the Secretary of the Company, at its
principal executive offices, a written notice of revocation or a duly executed
proxy bearing a later date, or by attending the Annual Meeting and expressing a
desire to vote his or her shares in person.
The close of business on June 3, 1998 has been fixed as the record date for
the determination of stockholders entitled to notice of and to vote at the
Annual Meeting or any adjournments of the Annual Meeting. As of the record
date, the Company had outstanding 7,567,629 shares of common stock, par value
$0.001 per share (the "Common Stock"), the only outstanding voting security of
the Company. As of the record date, the Company had approximately 620
stockholders of record. A stockholder is entitled to cast one vote for each
share held on the record date on all matters to be considered at th e Annual
Meeting.
With respect to the required vote on any particular matter, abstentions
will be treated as shares present and entitled to vote on the subject matter.
Thus, abstentions will be counted as "no" votes. Votes withheld by nominee
record holders who did not receive specific instructions from the beneficial
owners of shares will not be treated as votes cast or as shares present or
represented and will reduce the absolute number (although not the percentage) of
affirmative votes needed for approval.
The Company's principal executive offices are located 820 Flynn Road,
Camarillo, California 93012. This Proxy Statement and the accompanying Proxy
were mailed to stockholders on or about June 4, 1998.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
Pursuant to the Company's Bylaws, the Board of Directors has fixed the
number of directors at five. Each of the five nominees listed below are to be
elected for a one year term at the Annual Meeting. At the 1998 Annual Meeting,
each director will be elected for a term expiring at the 1999 annual meeting.
<PAGE>
INFORMATION WITH RESPECT TO EACH NOMINEE AND THE EXECUTIVE OFFICERS.
The following table sets forth certain information with respect to each
nominee and executive officer of the Company as of June 3, 1998.
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
James H. Chamberlain 50 Chairman of the Board,
President, Chief Executive Officer,
Director and Director Nominee
Leonard M. Hendrickson 50 Director and Director Nominee
John R. Overturf, Jr. 37 Director and Director Nominee
David J. Moffa, Ph.D. 55 Director and Director Nominee
Robert D. Weist 58 Director and Director Nominee
Larry A. May 48 Chief Financial Officer, Executive
Vice President - Finance
Gus Davis 50 Chief Operating Officer, Executive
Vice President Sales and Marketing
</TABLE>
Brief statements setting forth the principal occupation and employment
during the past five years, the year in which first elected as director and
other information concerning each nominee appear below.
JAMES H. CHAMBERLAIN has served as Director, President and Chief Executive
Officer of the Company and its predecessor, BioSource Industries, Inc., since it
was founded in October 1989, and was elected as its Chairman of the Board in
November 1993. Previously, Mr. Chamberlain was Manager for Business Development
for Amgen, Inc., where he started and managed the Amgen Biologicals Division.
Mr. Chamberlain has held various executive positions with Browning Ferris
Industries and Amersham Corporation, a biomedical company, and was a research
biochemist for Wm. H. Rorer Pharmaceutical, a major pharmaceutical company. He
received his Bachelor of Arts degree from West Virginia University, and studied
biochemistry at the University of Pittsburgh.
LEONARD M. HENDRICKSON has been a Director of the Company since October
1993. Mr. Hendrickson is the President of Isotope Products Laboratories, a
privately held company, a position he has held since February 1992. From
February 1990 to January 1992, Mr. Hendrickson served as the principal
consultant for Microchemics, a marketing and business development consulting
firm which he founded. Prior to that time, Mr. Hendrickson served as the
Director of Marketing for Scicor, a diagnostics laboratory in Indianapolis, and
held various executive positions with Amersham Corporation. Mr. Hendrickson has
also held positions with Marion Laboratories, a pharmaceutical company, and
Standard Oil Company. Mr. Hendrickson holds a Bachelor of Science degree from
the University of Pennsylvania and a Masters in Business Administration from
American University in Washington D.C.
DAVID J. MOFFA, PH.D., has been a Director of the Company since April 1995.
Dr. Moffa serves: as the Regional Director and as special projects director for
Lab Corporation of America, Inc. (Fairmont, WV), positions he has held since
1982 and 1984, respectively; as Director of Medical Arts Lab/RBL, a position he
has held since 1985; and as Director of Lab Corporation of America, Inc.
(Altoona, PA), a position he has held since 1990. Dr. Moffa also serves as an
advisor and consultant to various diagnostic, scientific and health care
facilities, and is an owner and developer of GM Realty and Moffa Properties.
Prior to serving in his current positions, Dr. Moffa has
2
<PAGE>
served as a Director and General Manager of BioMedical Reference and Roche
BioMedical Labs, as President, Chief Executive Officer and a Director of
BioPreps Laboratories, Inc., as Assistant Professor of Medical Biochemistry and
Director of Dental Biochemistry Programs at the West Virginia University School
of Medicine, as NIH Post Doctoral Fellow and Instructor in Medical Biochemistry
as well as a Graduate Research Assistant at the West Virginia University School
of Medicine. Dr. Moffa also serves on a number of committees and boards of
directors of various privately held companies and governmental offices. Dr.
Moffa has completed a post doctoral fellowship in Clinical Biochemistry at the
West Virginia University National Institutes of Health, holds a Ph.D in Medical
Biochemistry from the West Virginia University School of Medicine, a Masters of
Science degree in Biochemistry from West Virginia University and a Bachelor of
Arts degree in Pre-Medicine from West Virginia University.
JOHN R. OVERTURF, JR. has been a Director of the Company since September
1993. Mr. Overturf serves: as the President of R.O.I., Inc., a private
investment company, a position he has held since July 1993; and as President of
the Combined Penny Stock Fund, Inc., a closed-end stock market fund, a position
he has held since September 1996. From September 1993 until September 1996, Mr.
Overturf served as Vice President of The Rockies Fund, Inc., a closed-end stock
market fund. From June 1984 until February 1992, Mr. Overturf served as Vice
President of Colorado National Bank. Mr. Overturf holds a Bachelor of Science
degree in Finance from the University of Northern Colorado.
ROBERT D. WIEST has been a director of the Company since April 1996. Mr.
Wiest has been President of Weist Associates (a management consulting firm)
since April 1992. From January 1986 through April 1992, Mr. Weist was a
consultant to and Senior Vice President, Administration, General Counsel and
Secretary of Amgen, Inc., having served as Vice President, General Counsel and
Secretary from March 1982 through January 1986. Mr. Weist holds a Juris Doctor
degree from New York University and a Masters in Business Administration from
the University of Chicago.
LARRY A. MAY became Executive Vice President - Finance and Chief Financial
Officer of the Company on June 1, 1998. Prior to joining BioSource, Mr. May
served in various capacities at Amgen, the world's largest biotechnology
company, from 1983 to May 31, 1998. From 1997 to May 1998, Mr. May served as
Treasurer of Amgen, and from 1988 to 1997, served as its Corporate
Controller/Chief Accounting Officer, and from 1983 to 1988, Mr. May served as
Corporate Controller of Amgen. Mr. May has also served as Vice President of
Finance-West Coast Operators for IDC Services, a company providing payroll and
accounting services to major advertising agencies, motion picture and television
production companies (1978-1983). Mr. May holds a BS degree in Business
Administration and Accounting from the University of Missouri.
GUS DAVIS became Executive Vice President - Sales and Marketing and Chief
Operating Officer of the Company in June 1995. From February 1994 until June
1995, Mr. Davis served as Vice President of Sales and Marketing of the Company.
Prior to that time, since February 1993, Mr. Davis was employed as Vice
President of Sales and Marketing at Genosis BioTechnology, a company engaged in
the manufacture of oligonucleotides. From January 1983 to January 1993, Mr.
Davis was employed as the Midwestern Area Manager for Pharmacia BioTechnology, a
company involved in the sale of reagents and capital equipment used to purify
samples. Mr. Davis received his Bachelor of Science and Masters degree in
Biology and Chemistry from Sam Houston State University.
During the year ended December 31, 1998, the Board of Directors met 4
times. Each director attended all of the meetings of the Board of Directors
held during the year.
The Board of Directors has established an Audit Committee of the Board of
Directors which directly oversees the work of the Company's auditors with
respect to financial and accounting matters. The Board of Directors also has
established a Compensation Committee to review and make recommendations with
respect to compensation of executive officers and key employees. Messrs.
Hendrickson and Moffa currently comprise the Compensation Committee and Messrs.
Overturf and Wiest currently comprise the Audit Committee.
3
<PAGE>
VOTE REQUIRED TO APPROVE PROPOSAL NO. 1
The affirmative vote of a majority of the outstanding shares of Common
Stock present in person or by proxy at the Annual Meeting and entitled to vote
will be required to elect each of the nominees for director.
RECOMMENDATION OF THE BOARD
The Board of Directors unanimously recommends a vote FOR the election of
the nominees listed above.
PROPOSAL NO. 2
RATIFICATION OF APPOINTMENT
OF INDEPENDENT AUDITORS
The principal independent public accounting firm utilized by the Company
during the years ended December 31, 1994, 1995, 1996 and 1997 was KPMG Peat
Marwick LLP, independent certified public accountants (the "Auditors"). It is
presently contemplated that the Auditors will be retained as the principal
accounting firm to be utilized by the Company throughout the year ending
December 31, 1998. The Company anticipates that a representative of the
Auditors will attend the Annual Meeting for the purpose of responding to
appropriate questions. At the Annual Meeting, a representative of the Auditors
will be afforded an opportunity to make a statement if the Auditors so desire.
VOTE REQUIRED TO APPROVE PROPOSAL NO. 2
Ratification of the appointment of the Auditors requires the affirmative
vote of a majority of the outstanding shares of Common Stock present at the
Annual Meeting in person or by proxy.
RECOMMENDATION OF THE BOARD
The Board of Directors unanimously approved the adoption of Proposal No. 2.
The Board of Directors unanimously recommends a vote FOR Proposal No. 2
ratifying the appointment of KPMG Peat Marwick LLP as the Company's independent
auditors.
4
<PAGE>
MANAGEMENT
EXECUTIVE COMPENSATION
The following table sets forth both cash and noncash compensation paid or
accrued by the Company during 1995, 1996 and 1997 with respect to James H.
Chamberlain, Chief Executive Officer and President of the Company, and Gus
Davis, Chief Operating Officer and Executive Vice President, Anna Anderson,
Chief Financial Officer and Executive Vice President, Cirilo Cabradilla, Jr.,
Executive Vice President and Ed Sapp, Jr., General Manager, Europe (together,
the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
------------------- ------------------------------
NUMBER OF
YEAR ENDED SECURITIES
DECEMBER UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION 31, SALARY BONUS OPTIONS COMPENSATION
--------------------------- ---- -------- -------- --------- ------------
<S> <C> <C> <C> <C> <C>
James H. Chamberlain......................... 1997 $154,000 $ 42,500 -- $13,608(1)
Chairman of the Board 1996 144,000 113,072 137,500 11,172(2)
Chief Executive Officer and President 1995 129,000 15,000 100,000 720(2)
Gus Davis.................................... 1997 $110,000 $ 12,500 -- $ 4,579(3)
Chief Operating Officer 1996 95,000 20,000 -- 3,600(4)
and Executive Vice President 1995 81,000 13,000 55,000 3,600(4)
Anna Anderson................................ 1997 $110,000 $ 12,500 -- $ 347(5)
Chief Financial Officer 1996 95,000 18,000 -- --
and Executive Vice President 1995 80,000 9,000 25,000 --
-------- ----------
Cirilo Cabridilla, Jr........................ 1997 $ 96,000 $ 10,000 5,000 $ 494(5)
Executive Vice President 1996 90,250 15,000 -- --
1995 90,000 -- 35,000 --
Ed Sapp, Jr.................................. 1997 $ 87,292 $ -- -- $19,572(6)
General Manager, Europe 1996 53,813 -- -- --
1995 -- -- -- --
</TABLE>
- ----------
(1) Consists of $8,172 for an auto lease paid by the Company, $3,950 for
country club membership dues paid by the Company, and $1,486 for a group
life insurance premium paid buy the Company.
(2) Consists of $7,222 for an auto lease paid by the Company and $3,950 for
country club membership dues paid by the Company.
(3) Consists of $3,600 for a car allowance paid by the Company, $979 for a
group life insurance premium paid buy the Company.
(4) Consists of a car allowance paid by the Company.
(5) Consists of a group life insurance premium paid buy the Company.
(6) Consists of $405 for a group life insurance premium paid buy the Company,
and a 19,167 cost of living adjustment for a foreign assignment.
5
<PAGE>
STOCK OPTION GRANTS
The following table sets forth information regarding stock options granted
in 1997 to the Named Executive Officers.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-------------------------------------------------------------------
NUMBER OF PERCENT OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED TO
OPTIONS EMPLOYEES IN EXERCISE OF BASE
NAME GRANTED(1) FISCAL YEAR(2) PRICE ($/SH.)(3) EXPIRATION DATE
- -------------------------- ---------- -------------- ---------------- ---------------
<S> <C> <C> <C> <C>
James H. Chamberlain...... -- -- -- --
Gus Davis................. -- -- -- --
Anna Anderson............. -- -- -- --
Cirilo Cabradilla, Jr..... 5,000 2.58% $7.50 10/21/2007
Ed Sapp, Jr............... 5,000 2.58% $7.50 10/21/2007
</TABLE>
- ----------
(1) Options granted in 1997 vest over a four year period. The options were
granted for a term of ten years.
(2) Options covering an aggregate of 194,000 shares were granted to employees
of the Company and its subsidiary during the year ended December 31, 1997.
(3) The exercise price and the tax withholding obligations related to exercise
may be paid by delivery of already owned shares, subject to certain
conditions.
STOCK OPTIONS
The following table summarizes information with respect to the number of
shares of Common Stock underlying stock options held by the Named Executive
Officers at December 31, 1997 and the value of unexercised options at December
31, 1997 based upon the closing price of the Common Stock on the Nasdaq Small
Cap Market on December 31, 1997 ($6.375 per share) less the exercise price
thereof.
AGGREGATED YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
DECEMBER 31, DECEMBER 31,
SHARES 1997 1997
ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE REALIZED UNEXERCISABLE UNEXERCISABLE
- -------------------------- ----------- -------- ------------- -------------
<S> <C> <C> <C> <C>
James H. Chamberlain...... -- -- 265,884/71,616 $906,596/$64,906
Gus Davis................. -- -- 55,936/9,064 $255,192/$42,312
Anna Anderson............. 8,000 49,500 67,000/0 $ 290,972/$0
Cirilo Cabradillo, Jr..... -- -- 35,000/5,000 $ 91,875/$0
Ed Sapp, Jr............... -- -- 14,062/35,938 $ 0/$0
</TABLE>
6
<PAGE>
PRIOR PERFORMANCE OF COMPANY COMMON SHARES
The following chart presents for the five year period commencing on
December 31, 1992 and ending on December 31, 1997, the yearly percentage change
in the Company's cumulative total return on its Common Stock with the cumulative
total return for the same period, assuming reinvestment of dividends, of the
NASDAQ Stock Market Index (US) (January 1, 1992 = $100) and the Hambrecht &
Quist Biotechnology index (January 1, 1992 = $100). "Cumulative total return"
of the Company's Common Stock is measured by dividing (i) the difference between
the Company's share price at the end and beginning of the measurement period,
with share prices adjusted for stock splits and stock dividends effected during
the period. The information contained in the performance graph shall not be
deemed "soliciting material" or to be "filed" with the Securities and Exchange
Commission, nor shall such information be incorporated by reference into any
future filing under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, except to the extent that the Company specifically
incorporates it by reference into such filing. The stock price performance on
the following graph is not necessarily indicative of future stock price
performance.
CUMULATIVE TOTAL RETURN
<TABLE>
<CAPTION>
Measurement Period BIOSOURCE NASDAQ STOCK H & Q BIO-
(Fiscal Year Covered) INTL INC MARKET (U.S.) TECHNOLOGY
- ------------------- --------- ------------ ----------
<S> <C> <C> <C>
Measurement Pt-
12/92 $100.00 $100.00 $100.00
12/93 $107.35 $114.79 $ 86.20
12/94 $ 64.71 $112.21 $ 81.89
12/95 $267.65 $158.69 $139.30
12/96 $323.53 $195.18 $128.53
12/97 $300.00 $239.58 $130.10
</TABLE>
7
<PAGE>
REPORT OF COMPENSATION COMMITTEE
The Report of the Compensation Committee, which discusses certain matters
relating to the compensation of the executive officers of the Company, is
attached to this Proxy Statement as Appendix A.
DIRECTOR COMPENSATION
Directors are elected annually to serve until the next annual meeting of
stockholders and until their successors are elected and qualified. Nonemployee
directors of the Company currently are paid $2,000 for each Board meeting
attended, and $1,000 per year for serving on a Board Committee. The Company pays
all out-of-pocket fees of attendance. In addition, non-employee directors have
received an annual grant of 4,000 non-statutory stock options under the
Company's 1993 Stock Incentive Plan, exercisable at the fair market value of the
Company's Common Stock on the date of grant, and which fully vest on the date of
grant.
STOCK INCENTIVE PLAN
In addition to the 1993 Stock Incentive Plan (the "1993 Plan"), the Company
has granted non-statutory and incentive stock options outside of the 1993 Plan
to purchase an aggregate of 402,500 shares of the Company's Common Stock.
The 1993 Plan provides for the issuance of options and stock purchase
rights (together, "Rights") to employees, officers and, under certain
circumstances, directors of the Company. Options granted under the 1993 Plan may
be either Incentive Stock Options or Non-Qualified Stock Options. The 1993 Plan
imposes no limit on the number of officers and other key employees to whom
awards may be made. At May 1, 1998, approximately 86 persons were eligible to
receive Rights under the 1993 Plan. An aggregate of 1,500,000 shares of the
Company's Common Stock are reserved for issuance under the 1993 Plan. At May 1,
1998, 1,018,665 options were outstanding under the 1993 Plan, 163,263 shares had
been issued upon exercise of options granted under the 1993 Plan.
EMPLOYMENT AGREEMENT
Effective as of January 2, 1998, James Chamberlain entered into an
employment agreement with the Company which superseded Mr. Chamberlain's
existing Employment Agreement dated January 2, 1996. The term of the Employment
Agreement is three years. Pursuant to the terms of the Employment Agreement, Mr.
Chamberlain is to be paid an annual salary of $250,000 for each year of the
Agreement, an annual bonus determined on the basis of the Company's existing
management incentive plan which is limited to $100,000 for each year of the
Agreement and is to receive certain additional benefits.
In the event there is a "change of control" of the Company, Mr. Chamberlain
may terminate his employment agreement, in which case, the Company is obligated
to continue to pay Mr. Chamberlain his then-current base salary for a period of
12 months following the effective date of such termination. A "change of
control" includes (i) the acquisition by any person or entity of shares of
capital stock of the Company entitled to exercise 35% or more of the total
voting power of the Company, (ii) the execution by the Company of an agreement
to sell or otherwise transfer all or substantially all of its assets or the
execution by the Company of an agreement to merge, consolidate or reorganize
with any other corporation or entity, which results in less than 75% of the
total voting power represented by the capital stock or other equity interests of
the corporation or entity to which the Company's assets are sold or transferred
or surviving such merger, consolidation or reorganization being held by the
persons and entities who were holders of common stock of the Company on January
1, 1998, (iii) the issuance by the Company, otherwise than on a pro rata basis,
of additional shares of capital stock representing (after giving effect to such
issuance) more than 35% of the total voting power of the Company, or (iv) if the
persons who were the directors of the Company as of January 1, 1998 cease to
comprise a majority of the Board of Directors of the Company.
CERTAIN TRANSACTIONS
The Company's Chairman of the Board, President, and Chief Executive
Officer, James H. Chamberlain, is indebted to the Company in the aggregate
principal amount of $434,000 as of May 31, 1998, which was the largest aggregate
amount of such indebtedness during fiscal 1997. The loans are represented by two
separate promissory notes, one in the principal amount of $350,000, bearing
interest 5.9% per annum, and one in the principal amount of $84,000, bearing
interest at 5.51% per annum. Each loan provides for interest only payments,
payable monthly, with all principal due upon demand.
8
<PAGE>
PRINCIPAL STOCKHOLDERS
The following table sets forth certain information with respect to the
beneficial ownership of the Common Stock as of May 1, 1998. Additionally, the
table below sets forth beneficial ownership regarding (i) each person (including
any group) known by the Company to be the beneficial owner of more than 5% of
the Common Stock, (ii) each director of the Company, and (iv) all directors and
executive officers of the Company as a group. Except as may be indicated in the
footnotes to the table, each of such persons has sole voting and investment
power with respect to all shares owned, subject to applicable community property
laws. The address of each person listed is in care of the Company, 820 Flynn
Road, Camarillo, California 93012.
<TABLE>
<CAPTION>
NUMBER OF PERCENTAGE OF
NAME AND ADDRESS SHARES(1) CLASS
- ----------------------------------- ------------ -------------
<S> <C> <C>
James H. Chamberlain 774,644(2) 8.88%
Leonard M. Hendrickson 49,000(3) *
John R. Overturf, Jr. 38,000(4) *
David J. Moffa, Ph.D. 34,800(5) *
Robert D. Weist 28,000(6) *
Directors and executive officers as 1,079,640(7) 12.00%
a group (7 persons)
</TABLE>
- ----------
* Less than one percent.
(1) Beneficial ownership is determined in accordance with rules of the
Securities and Exchange Commission that deem shares to be beneficially
owned by any person who has or shares voting or investment power with
respect to such shares. Unless otherwise indicated, the persons named in
this table have sole voting and sole investment power with respect to all
shares shown as beneficially owned, subject to community property laws
where applicable. In addition, shares are deemed to be beneficially owned
by a person if the person has the right to acquire the shares (for example,
upon exercise of an option) within 60 days of the date as of which the
information is provided; in computing the percentage ownership of any
person, the amount of shares outstanding is deemed to include the amount of
shares beneficially owned by such person (and only such person) by reason
of these acquisition rights. As a result, the percentage of outstanding
shares of any person as shown in the following table does not necessarily
reflect the person's actual voting power at any particular date.
(2) Includes (i) 285,938 shares of Common Stock reserved for issuance upon
exercise of stock options which are currently exercisable; (ii) 485,156
shares of Common Stock held in the Chamberlain Family Trust for which Mr.
Chamberlain serves as trustee; (iii) 3,200 shares of Common Stock held in
Mr. Chamberlain's IRA Account; and (iv) 350 shares of Common Stock held in
the name of Mr. Chamberlain's spouse.
(3) Includes (i) 38,000 shares of Common Stock reserved for issuance upon
exercise of stock options which are currently exercisable; (ii) 4,000
shares of Common Stock held of record by two of Mr. Hendrickson's minor
children; and (iii) 7,000 shares of Common Stock held in the Microchemics
Simplified Employee Pension Plan.
(4) Includes 36,000 shares of Common Stock reserved for issuance upon exercise
of stock options which are currently exercisable.
(5) Includes (i) 30,500 shares of Common Stock reserved for issuance upon
exercise of stock options which are currently exercisable; and (ii) 2,000
shares of Common Stock held jointly with, or solely by, Dr. Moffa's spouse.
(6) Includes 28,000 shares of Common Stock reserved for issuance upon exercise
of stock options which are currently exercisable.
(7) Includes 546,474 shares of Common Stock reserved for issuance upon exercise
of stock options which are currently exercisable.
9
<PAGE>
SECTION 16(A) COMPLIANCE
Based solely on its review of copies of reports filed by reporting persons
of the Company pursuant to Section 16(a) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), or written representations from certain
reporting persons that no Form 5 filing was required for such person, the
Company believes that all filings required to be made by reporting persons of
the Company were timely made in accordance with the requirements of the Exchange
Act, except that Anna Anderson reported a change in ownership on a Form 5 Annual
Report of Beneficial Ownership which was filed in February 1998, which should
have been reported on Form 4 Change in Beneficial Ownership of Securities during
fiscal 1997.
AUDITORS
KPMG Peat Marwick LLP, independent certified public accountants, was
selected by the Board of Directors to serve as independent auditors of the
Company for the year ending December 31, 1997. Representatives of KPMG Peat
Marwick LLP are expected to be present at the Annual Meeting.
PROPOSALS OF STOCKHOLDERS
A proper proposal submitted by a stockholder for presentation at the
Company's 1999 annual meeting of stockholders and received at the Company's
executive offices no later than January 3, 1999, will be included in the
Company's proxy statement and form of proxy relating to the 1998 annual meeting
of stockholders.
OTHER MATTERS
The Board of Directors is not aware of any matter to be acted upon at the
Annual Meeting other than described in this Proxy Statement. Unless otherwise
directed, all shares represented by the persons named in the accompanying proxy
will be voted in favor of the proposals described in this Proxy Statement. If
any other matter properly comes before the meeting, however, the proxy holders
will vote thereon in accordance with their best judgment.
EXPENSES
The entire cost of soliciting proxies will be borne by the Company.
Solicitation may be made by mail. The Company will request brokerage houses,
nominees, custodians, fiduciaries and other like parties to forward soliciting
material to the beneficial owners of the Company's Common Stock held of record
by them and will reimburse such persons for their reasonable charges and
expenses in connection therewith.
ANNUAL REPORT TO STOCKHOLDERS
The Company's Annual Report for the year ended December 31, 1997 is being
mailed to stockholders along with this Proxy Statement. The Annual Report is
not to be considered part of the soliciting material.
REPORT ON FORM 10-K
THE COMPANY UNDERTAKES, UPON WRITTEN REQUEST, TO PROVIDE, WITHOUT CHARGE,
EACH PERSON FROM WHOM THE ACCOMPANYING PROXY IS SOLICITED WITH A COPY OF THE
COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1997, AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, INCLUDING THE FINANCIAL
STATEMENTS AND SCHEDULES THERETO, BUT EXCLUDING EXHIBITS THERETO. REQUESTS
SHOULD BE ADDRESSED TO BIOSOURCE INTERNATIONAL, INC., 820 FLYNN ROAD, CAMARILLO,
CALIFORNIA 93012, ATTENTION: CHIEF EXECUTIVE OFFICER.
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APPENDIX A
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
ON EXECUTIVE COMPENSATION
The following report of the Compensation Committee of the Board of
Directors shall not be deemed to be incorporated by reference into any previous
filing by the Company under either the Securities Act of 1933 ("Securities Act")
or the Securities Exchange Act of 1934 ("Exchange Act") that incorporates future
Securities Act or Exchange Act filings in whole or in part by reference.
To the Board of Directors:
OVERVIEW OF EXECUTIVE COMPENSATION
The goal of the BioSource executive compensation program is to attract and
retain talented biotechnology and life sciences industry executives that are
necessary for the Company to maximize returns to stockholders.
There are three elements to the BioSource executive compensation program
designed to achieve those goals.
. Base salary levels appropriate for the stage of development of
BioSource.
. Equity participation through the BioSource stock option program that
will reward individuals when share prices increase. Individuals are
given grants that reflect their relative impact on Company
performance.
. Incentive compensation that rewards individual performance when
corporate goals are met.
Total executive compensation from salary and incentives are within a
competitive range for executives in the biotechnology and life sciences
industries, when compared to companies of similar size and stage of development.
Competitive compensation ranges are based on information derived at the
beginning of 1996 from the RADFORD survey of compensation levels in this
industry and additional companies chosen because of their comparable nature in
the biotechnology field.
An important element in the compensation package is stock options. The
board supports the wide use of this incentive within BioSource. While widely
used, the total number of options outstanding is not expected to result in undue
dilution of stockholders' equity. The total amount of shares in the BioSource
stock option pool is approximately 22% of total shares outstanding. This
compares to the average of 17.5% of shares outstanding for biotechnology
companies in the RADFORD survey with 100-300 employees.
The Board has believed and continues to believe that a factor to be
considered when comparing these compensation parameters is that the employees of
BioSource believe in the long term growth of the Company. The management team
believes that attainment of future growth is less speculative for BioSource than
some of the peer group companies used in the compensation surveys. This will be
reflected in the future value of stock options that will outweigh the relatively
low compensation rankings attained by the management group in these surveys.
DISCUSSION OF CHIEF EXECUTIVE OFFICER COMPENSATION
In addition to the RADFORD survey, an additional comparison was performed
in 1996 against 12 other small public biomedical companies. In the RADFORD
survey, the base salary paid to the CEO was the lowest in a group of 83
reporting companies with 51-149 employees. The compensation of the CEO was also
compared to a group of 12 other small public biomedical companies. In this
group of 13, the CEO ranked 10th of the 13 companies, just above the bottom 25th
percentile.
The incentive cash compensation paid to the CEO was well below the average
of 26% in the RADFORD survey, and total cash compensation remained in the bottom
10% of reporting companies. The Board had previously announced its policy of
continuing to maintain executive salaries consistent with the revenue levels of
the Company, profitability and a policy of overall cost control. It also
indicated that it was not the intention of the Board to maintain indefinitely
the executive compensation levels within BioSource at a low level compared to
other companies in the biotechnology and life sciences fields, and that as the
Company continues to progress, it was planned that salary and incentive
compensation for the CEO will trend toward the middle of this group. For these
reasons, in 1998, the CEO's annual compensation was increased to $250,000.
DISCUSSION OF SENIOR EXECUTIVE COMPENSATION
The average salary of the executives reporting to the CEO also ranks low
among comparable companies. The Board believes this is reflective of both the
early stage of the Company's development and the relative time in position for
these executives as a group. Because of the relative pay, stock options have
been used widely as a compensation tool within this group. As with the Chief
Executive Officer, the 1998 compensation for certasin senior executives was
increased as well.
Each senior executive of the Company, including the CEO, has personal
achievement goals to which incentive compensation is tied. To receive incentive
compensation, corporate goals must also be attained.
Compensation Committee of the Board of Directors:
Leonard M. Hendrickson
David J. Moffa, Ph.D.
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BIOSOURCE INTERNATIONAL, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
The undersigned, a Stockholder of BIOSOURCE INTERNATIONAL, INC., a Delaware
corporation (the "Company"), hereby nominates, constitutes and appoints James H.
Chamberlain and Larry A. May, and each of them, the proxies of the undersigned,
each with full power of substitution, to attend, vote and act for the
undersigned at the Annual Meeting of Stockholders of the Company, to be held on
July 17, 1998, and any postponements or adjournments thereof, and in connection
therewith, to vote and represent all of the shares of the Company which the
undersigned would be entitled to vote, as follows:
A VOTE FOR ALL PROPOSALS IS RECOMMENDED BY THE BOARD OF DIRECTORS:
Proposal 1. To elect the Board of Directors' five nominees as directors.
James H. Chamberlain David S. Moffa, Ph.D. John R. Overturf, Jr.
Leonard M. Hendrickson Robert D. Weist
[_] FOR ALL NOMINEES LISTED ABOVE (except as marked to the contrary below)
[_] AGAINST [_] WITHHELD
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space below:)
_______________________________________________________________________________
The undersigned hereby confer(s) upon the proxies and each of them discretionary
authority with respect to the election of directors in the event that any of the
above nominees is unable or unwilling to serve.
Proposal 2. To ratify the appointment of KPMG Peat Marwick, LLP as the
Company's independent public accountants for the year ending December 31, 1998.
[_] FOR [_] AGAINST [_] WITHHELD
The undersigned hereby revokes any other proxy to vote at the Annual
Meeting, and hereby ratifies and confirms all that said attorneys and proxies,
and each of them, may lawfully do by virtue hereof. With respect to matters not
known at the time of the solicitation hereof, said proxies are authorized to
vote in accordance with their best judgment.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS SET FORTH
ABOVE OR, TO THE EXTENT NO CONTRARY DIRECTION IS INDICATED, WILL BE TREATED AS A
GRANT OF AUTHORITY TO VOTE FOR ALL PROPOSALS. IF ANY OTHER BUSINESS IS PRESENTED
AT THE ANNUAL MEETING, THIS PROXY CONFERS AUTHORITY TO AND SHALL BE VOTED IN
ACCORDANCE WITH THE RECOMMENDATIONS OF THE PROXIES.
The undersigned acknowledges receipt of a copy of the Notice of Annual
Meeting and accompanying Proxy Statement dated June 4, 1998, relating to the
Annual Meeting.
Dated:___________________________, 1998
Signature:_____________________________
Signature:_____________________________
Signature(s) of Stockholder(s)
(See Instructions Below)
The Signature(s) hereon should
correspond exactly with the name(s) of
the Stockholder(s) appearing on the
Share Certificate. If stock is jointly
held, all joint owners should sign.
When signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. If
signer is a corporation, please sign
the full corporation name, and give
title of signing officer.
[_] Please indicate by checking this box if you anticipate attending the
Annual Meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
BIOSOURCE INTERNATIONAL, INC.
