<PAGE>
<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2)
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting material Pursuant to Sec.240.141-11(C) or Sec.240.14a-12
INVITRO INTERNATIONAL
- ------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
N/A
- -------------------------------------------------------------------------
Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(I)(1), 14a-6(I)(2)
or Item 22(a)(2) of Schedule 14A
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(I)(3)
[ ] 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:
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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:
- ----------------------------------------------------------------
<PAGE> 2
[ ] 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:
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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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<PAGE>
<PAGE>
INVITRO INTERNATIONAL
NOTICE OF ANNUAL MEETING
JANUARY 31, 1997
Notice is hereby given that the Annual Meeting of Shareholders of
INVITRO INTERNATIONAL, a California corporation (the "Company"), will be
held at the principal office of the Company, 16632 Millikan Avenue,
Irvine, California 92606, on Friday, January 31, 1997 at 3:00 P.M. local
time. The Annual Meeting will be held for the following purposes, as
more fully described in the attached Proxy Statement:
1. To elect a Board of six (6) Directors.
2. To consider and act upon a proposed amendment to the
Company's articles of incorporation for the purpose of
effecting a 1-for-10 reverse stock split with respect to
its issued and outstanding Common Stock ("Proposal 2").
3. To consider and act upon any other matters which may
properly come before the meeting or any adjournment
thereof.
In accordance with the provisions of the Bylaws, the Board of
Directors has fixed the close of business on December 9, 1996 as the
record date for the determination of the holders of Common Stock entitled
to notice of and to vote at the Annual Meeting.
Whether or not you expect to attend the meeting in person, please
complete, date and sign the enclosed proxy card and mail it as promptly
as possible in the enclosed envelope to assure representation of your
shares at the meeting.
By Order of the Board of Directors,
WILLIAM M. CURTIS,
Secretary
Irvine, California
___________, 1996
<PAGE>
<PAGE>
InVitro International
16632 Millikan Avenue
Irvine, California 92606
PROXY STATEMENT
----------------------
ANNUAL MEETING OF SHAREHOLDERS
JANUARY 31, 1997
----------------------
PROXIES
The enclosed proxy is solicited on behalf of the management and
Board of Directors of INVITRO INTERNATIONAL, a California corporation
(the "Company" or "InVitro"), for use at the Company's Annual Meeting of
Shareholders and at any and all adjournments thereof. Any shareholder
has the power to revoke his or her proxy at any time before it is voted.
A proxy may be revoked at any time prior to its exercise by delivering
a written notice of revocation to the Secretary of the Company at its
principal office address listed above, by a subsequent proxy executed by
the person executing the prior proxy and presented to the Secretary of
the Company, or by attendance at the meeting and voting in person by the
person executing the proxy.
The cost of preparing, assembling and mailing this Notice of Annual
Meeting and Proxy Statement and the enclosed proxy card will be paid by
the Company. Following the mailing of this Proxy Statement, directors,
officers and regular employees of the Company may solicit proxies by
mail, telephone, telegraph or personal interview. Such persons will
receive no additional compensation for such services. Brokerage houses
and other nominees, fiduciaries and custodians nominally holding shares
of the Company's common stock of record will be requested to forward
proxy soliciting material to the beneficial owners of such shares, and
will be reimbursed by the Company for their reasonable charges and
expenses in connection therewith. This Proxy Statement was first mailed
to the Company's shareholders on or about ________, 1996
A copy of the Company's 1996 Annual Report to Shareholders, which
includes financial statements for its last fiscal year ended September
30, 1996, is being concurrently mailed on or about __________, 1996 to
each shareholder of record as of the close of business on ___________,
1996.
VOTING SECURITIES
The holders of record of the Company's common stock at the close of
business on December 9, 1996, the record date for the Annual Meeting, are
entitled to notice of and to vote at the Annual Meeting. The Company had
14,028,300 shares of common stock ("Common Stock") outstanding as of
December 9, 1996. Each share of Common Stock entitles the holder thereof
to one vote on each matter to be acted upon at the meeting and, in the
election of directors, shareholders may be allowed to cumulate votes in
accordance with Section 708 of the California General Corporation Law.
Abstentions and broker "non-votes" will be counted in determining the
number of shares present for a quorum but will not be voted for election
of directors or on other proposals and will have the same effect as
abstentions.
<PAGE>
The right to cumulate votes for a nominee will exist only if a
candidate's name, other than the six nominees listed below, has been
placed in nomination prior to the voting and any shareholder gives notice
at the meeting prior to the voting of that shareholder's intention to
cumulate his or her votes. In cumulative voting, each shareholder has
the right to accumulate his or her votes and give one nominee a number
of votes equal to the number of directors to be elected multiplied by the
number of his or her shares, or to distribute the votes on the same
principle among as many nominees as he or she shall determine, and the
nominees receiving the highest number of votes up to the number of
directors to be elected shall be elected. In the event anyone other than
the six nominees listed below shall be nominated for election as a
director, the persons named in the proxy will have the authority, to be
exercised in their discretion, to vote cumulatively for less than all the
nominees.
The following table sets forth information (except as otherwise
indicated by footnote) as to shares of Common Stock owned on December 9,
1996 by (i) each person known by management to beneficially own more than
5% of the Company's outstanding Common Stock, (ii) each of the Company's
directors, nominees for election as directors and the named executive
officers in the Summary Compensation Table, and (iii) all executive
officers, directors and nominees for election as directors as a group:
<TABLE>
<CAPTION>
Common Stock (2)
-----------------------
Name or Group (1) Shares % of Class
----------------------- ---------- ----------
<S> <C> <C>
Directors, Nominees and
Named Executive Officers:
Dennis E. Chenoweth (3) ............ 40,000 0.3%
William M. Curtis (4) .............. 137,260 1.0%
Irwin J. Gruverman (5) ............. 801,022 5.7%
David A. Reed (6) ................... 25,000 0.2%
Jeffrey A. Safchik (7) ............. 769,333 5.3%
W. Richard Ulmer (8) ............... 278,332 1.9%
All officers and directors
as a group [six persons] (9) .... 2,050,947 13.7%
</TABLE>
- -----------------
(1) The persons named in the table have sole voting and investment power
with respect to all shares shown to be beneficially owned by them,
subject to community property laws where applicable and the
information contained in the footnotes to this table. Unless
otherwise indicated in the following footnotes, the address of each
person in the table is 16632 Millikan Avenue, Irvine, California
92606.
(2) Common Stock includes, where applicable, Common Stock beneficially
owned and shares issuable upon exercise of stock options or warrants
that were fully exercisable or exercisable within a period of 60
days from December 9, 1996 (the "Record Date").
-2-
<PAGE>
(3) Includes stock options held by Dr. Chenoweth that were fully
exercisable or exercisable within a period of 60 days from the
Record Date covering 40,000 shares of Common Stock at an option
price of $1.00 per share.
(4) Includes 108,927 shares owned by Mr. Curtis plus stock options held
by Mr. Curtis that were fully exercisable as of the Record Date
covering 28,333 shares of Common Stock at option prices ranging from
$1.375 to $1.50 per share. Mr. Curtis' business address is 25241
Buckskin Drive, Laguna Hills, California 92653.
(5) Includes 210,676 shares owned by Mr. Gruverman and stock options
held by Mr. Gruverman that were fully exercisable as of the Record
Date covering 8,333 shares of Common Stock at an option price of
$1.375 per share plus 582,013 shares owned by three investment
limited partnerships for which Mr. Gruverman is the general partner.
Mr. Gruverman has the power to vote and dispose of shares owned by
the limited partnerships but disclaims beneficial ownership of
shares held by limited partnerships in which he is a general
partner. Mr. Gruverman's business address is 30 Ossipee Road,
Newton, Massachusetts 02164.
(6) Includes stock options held by Mr. Reed that were fully exercisable
as of the Record Date covering 25,000 shares of Common Stock at an
option price of $1.00 per share. Mr. Reed's business address is
24681 La Plaza, Suite 240, Dana Point, California 92629.
(7) Includes stock options held by Mr. Safchik that were fully
exercisable as of the Record Date covering 58,333 shares of Common
Stock at option prices ranging from $1.375 to $2.00 per share,
211,000 shares beneficially owned by Greenstreet Partners, an
affiliate of Mr. Safchik, and warrants that are fully exercisable
as of the Record Date covering 500,000 shares of Common Stock
exercisable at $1.75 per share held by Greenstreet Partners. Mr.
Safchik disclaims beneficial ownership of shares and warrants held
by Greenstreet Partners. Mr. Safchik's business address is 701
Brickell Avenue, Suite 2420, Miami, Florida 33131.
(8) Includes 5,000 shares owned by Mr. Ulmer plus stock options that
were fully exercisable or exercisable within a period of 60 days
from the Record Date covering 273,332 shares of Common Stock at
option prices ranging from $1.00 to $1.75 per share.
(9) Includes shares described in Notes 3 through 8 above.
ELECTION OF DIRECTORS
The six persons named below have been nominated by management for
election as directors to serve until the next Annual Meeting of
Shareholders to be held in 1998 and until their respective successors are
elected and shall qualify. All nominees have served as directors of the
Company since its last Annual Meeting of Shareholders except for David
A. Reed who was first elected a director on August 5, 1996. Unless
otherwise instructed, the enclosed proxy will be voted for election of
the following nominees, except that the persons designated as proxies
reserve full discretion to cast their votes for another person
recommended by management in the unanticipated event that any nominee is
unable or declines to serve.
-3-
<PAGE>
<TABLE>
<CAPTION>
Name of Nominee Age Director Since
------------------------------ --- ----------------
<S> <C> <C>
W. Richard Ulmer 54 November 1994
Dennis E. Chenoweth 52 August 1995
Irwin J. Gruverman (1)(2)(3) 63 March 1993
David A. Reed 63 August 1996
Jeffrey A. Safchik (2)(3) 45 February 1994
William M. Curtis (1)(2)(3) 56 September 1985
-------------------------------------------------
(1) Member of Stock Option Committee.
(2) Member of Audit Committee.
(3) Member of Compensation Committee.
W. RICHARD ULMER has served as President, Chief Executive Officer
and a director of the Company since November 15, 1994. Mr. Ulmer started
his career in the health care and pharmaceutical industry at Merck, Sharp
& Dome in 1964. For approximately 25 years from 1967 to 1992, he was
employed by Allergan, Inc., an integrated specialty pharmaceutical and
medical device company headquartered in Southern California. During that
period Mr. Ulmer held various key management positions, including
marketing and sales management positions from 1967 to 1977; Director of
Sales and Marketing for Allergan International from 1977 to 1979; Vice
President of U.S. Sales and Marketing from 1979 to 1981; Senior Vice
President of U.S. Operations from 1981 to 1985; President of Allergan
Pharmaceuticals from 1985 to 1988; President of Allergan Medical Optics -
Surgical Products and Services Division from 1988 to 1990; and President
of Herbert Laboratories (Allergan Herbert) from 1991 to 1992. Mr. Ulmer
was self-employed as a consultant from 1992 to 1994 and served as
President of Wilshire Transdermal, a subsidiary of Wilshire Technologies,
from March 1994 to November 1994 where he was employed to develop a
turnaround strategy.
DENNIS E. CHENOWETH was employed as Senior Vice President of InVitro
on February 21, 1995 and was elected a director of the Company on August
24, 1995. Following the completion of an analysis and reformatting of
the Company's product lines for in vitro safety tests, Dr. Chenoweth's
position with the Company was changed in October 1996 from a full-time
employee to a part-time consultant by mutual agreement between the
Company and Dr. Chenoweth. After receiving a Ph.D. degree in
Biochemistry from Northwestern University in 1970 and an M.D. degree from
the University of California, Irvine in 1975, he completed residency
training in Pathology at the University of California, San Diego in 1977.
Dr. Chenoweth began his scientific research career in 1978 as an
Assistant Member at Scripps Clinic and Research Foundation. In 1981, he
was appointed Associate Professor of the Pathology Department at the
University of California, San Diego. During his five years in that
position from 1981 to 1986, he conducted medical research and taught at
the medical school. Dr. Chenoweth joined the research staff at Baxter
Healthcare in 1986. While at Baxter Healthcare, he was promoted to the
position of Vice President of Research and Development in its Fenwal
Division and also served as a scientific founder of its Immunotherapy
Division located in Santa Ana, California. In 1994, Dr. Chenoweth
relocated to Menlo Park, California, where he served both as President
and Chief Operating Officer of Geneic Sciences, Inc. and as Senior Vice
President of Operations for Titan Pharmaceuticals. He was the first
President of Geneic Sciences, an early-stage biotechnology company that
-4-
<PAGE>
focused on the development of cell separation products for use in
allogeneic transplantation procedures. Dr. Chenoweth received his MBA
degree from Pepperdine University in 1995. He is the author of more than
100 peer-reviewed scientific publications and a member of numerous
scientific societies.
IRWIN J. GRUVERMAN was elected a director of the Company on March
11, 1993 and Chairman of the Board on April 23, 1993. He founded and
serves as Chairman, Chief Executive Officer and a director of
Microfluidics International Corporation, a publicly-held supplier of
innovative formulation equipment and methodology to the health care,
food, cosmetics, home products and process industries. Prior to 1982,
Mr. Gruverman was Executive Vice President of the New England Nuclear
Division of E. I. DuPont & Company, with responsibility for health care
activities, including immunodiagnostics and radiopharmaceuticals. He was
responsible for the development and commercial success of Thallium-201,
an imaging agent for diagnosis of heart disease. He has served since
1990 as the general partner of a series of limited partnerships jointly
organized by Mr. Gruverman and Searle Venture Capital Co. under the name
G & G Diagnostics to invest in medical diagnostic opportunities in North
America and Europe. Mr. Gruverman is a licensed Professional Engineer
and holds a B.S. degree in chemical engineering from The Cooper Union,
New York, and a M.S. degree in Nuclear Engineering from Massachusetts
Institute of Technology. He serves as a director of the following
publicly-held companies in addition to the Company and Microfluidics
International Corporation: FiberChem, Inc. of Las Vegas, Nevada, a
manufacturer of environmental test equipment; and Endogen, Inc., Woburn,
Massachusetts, a supplier of specialty reagents and immunoassay test
kits.
DAVID A. REED was elected a director of the Company on August 5,
1996. He has been primarily employed since 1995 as President of DAR
Consulting Group, Dana Point, California, an independent consultant to
the health care industry, and Mr. Reed also serves as a special advisor
to the Health Care Practice Group of Deloitte & Touche LLP. Mr. Reed
served from 1990 through December 1994 as President and Chief Executive
Officer of St. Joseph Health System, Orange, California, a nonprofit
public benefit corporation that owns and operates hospitals and other
health care service entities. Prior to 1990, he was employed for 11
years by Samaritan Health Services in Phoenix, Arizona, completing that
tenure as President of its multihospital system and foundation. Mr. Reed
has also served as President of Lenox Hill Hospital, New York City, and
as Administrator of the University of Cincinnati teaching hospital. He
has previously been active in various state and metropolitan hospital
associations, served as a board member of the Council of Teaching
Hospitals of the Association of American Medical Colleges, and is a past
Chairman of the Board and Speaker of the House of Delegates of the
American Hospital Association. Mr. Reed serves as a director of
Pacificare Health Systems, Inc., Cyress, California, a publicly-held
company engaged in managed health care services for commercial, Medicare
and Medicaid members and a leader in the management, development and
marketing of diversified health maintenance organization products and
related services. He holds an M.S. degree from the University of
Pittsburgh Graduate School of Public Health Program in Medical and
Hospital Administration.
JEFFREY A. SAFCHIK was elected a director of InVitro on March 9,
1994. Mr. Safchik has been employed since 1994 as Managing Director and
Chief Financial Officer of Greenstreet Partners, a Florida based
investment fund and management consulting firm. During the period from
-5-
<PAGE>
1990 to 1993, he was involved with McCrory Corporation, initially as a
consultant concerning various strategic planning matters and then as its
Executive Vice President of Finance and Chief Financial Officer. Prior
to Mr. Safchik's involvement with McCrory Corporation, he served as the
Chief Financial Officer of a privately-held real estate company from 1986
to 1990. Mr. Safchik holds a Master's degree in taxation and is a
certified public accountant.
WILLIAM M. CURTIS has served as an executive officer and director
of the Company since its inception in 1985. Mr. Curtis has been
principally engaged in a private law practice in Southern California
since 1976 specializing in corporate, merger and acquisition, finance and
securities matters. He was associated with the New York law firm of
Willkie Farr & Gallagher from 1965 through 1970. Mr. Curtis served as
a vice president, general counsel and a director from 1971 through 1975
of Plant Industries, a publicly-held packaging company, and as a director
of Brennand-Paige Industries, Inc., a diversified publicly-held company,
from 1971 until sale of that company in 1983. Mr. Curtis holds a law
degree from Duke University.
There are no family relationships between any of the Company's
directors and executive officers. All directors hold office until the
next Annual Meeting of Shareholders and until their successors are
elected. Officers serve at the discretion of the Board of Directors.
The Board of Directors currently has three committees, the Stock Option
Committee, the Audit Committee and the Compensation Committee.
The Stock Option Committee is responsible for granting options under
the Company's employee stock option plans, establishing the terms and
conditions of options granted under those plans, and administering
employee stock options. Actions by the Stock Option Committee during the
fiscal year ended September 30, 1996 were at one meeting of the full
Board of Directors. Current members of the Stock Option Committee
include Messrs. Curtis and Gruverman.
The Audit Committee is responsible for meeting independently with
representatives of InVitro's independent accountants and with
representatives of senior management. The Audit Committee also is
responsible for reviewing the general scope of the audit, the fees
charged by independent accountants and matters relating to internal
control systems. The Audit Committee met once during the fiscal year
ended September 30, 1996 at a meeting of the full Board of Directors.
Current members of the Audit Committee include Messrs. Curtis, Gruverman
and Safchik.
The Compensation Committee is responsible for reviewing and
reporting to the Board on the recommended annual compensation for the
Company's Chief Executive Officer and for reviewing management
recommendations concerning compensation programs for other executive
officers. The Compensation Committee met once during the fiscal year
ended September 30, 1996 at a meeting of the full Board of Directors.
Current members of the Compensation Committee include Messrs. Curtis,
Gruverman and Safchik.
During the fiscal year ended September 30, 1996 the Board of
Directors held six meetings. No incumbent director attended fewer than
75% of all meetings of the Board of Directors except that Mr. Safchik
attended four of the six Board meetings during the fiscal year ended
September 30, 1996.
-6-
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY EXECUTIVE COMPENSATION
The following Summary Compensation Table indicates the cash
compensation paid by the Company as well as certain other compensation,
paid or accrued for its fiscal years ended September 30, 1996, 1995 and
1994 to each of InVitro's Chief Executive Officer and other executive
officers whose compensation exceeded $100,000 for the fiscal year ended
September 30, 1996:
</TABLE>
<TABLE>
<CAPTION>
Annual Compensation (1) Long Term Compensation
------------------------------ -------------------------------
Awards Payouts
---------------------- -------
Other Restricted Securities
Annual Stock Underlying LTIP All Other
Name and Fiscal Salary Bonus Compen- Awards Options/ Payouts Compen-
Principal Position Year(2) ($) (4) ($) sation($) ($) SARs(#) ($) sation($)
- ----------------------- ------- --------- --------- --------- --------- --------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
W. Richard Ulmer 1996 $139,518 -0- (1) -0- -0- -0- -0-
President & Chief 1995 $140,626 -0- (1) -0- 410,000 -0- -0-
Executive Officer (3)
Dennis E. Chenoweth 1996 $125,849 -0- (1) -0- -0- -0- -0-
Senior Vice 1995 $70,615 $25,000 (1) -0- 210,000 -0- -0-
President (4)
</TABLE>
- -----------------------------------
(1) Total perquisites did not exceed the lesser of $50,000 or 10% of the
executive's annual salary and bonus.
(2) Information set forth in the table represents data for the fiscal
years ended September 30, 1996 ("1996") and 1995 ("1995"). No
person listed in the table was employed by the Company during the
fiscal year ended September 30, 1994.
(3) Mr. Ulmer was first elected President and Chief Executive Officer
of the Company on November 15, 1994.
(4) Dr. Chenoweth was first employed by the Company on February 21,
1995. Following the completion of an analysis and reformatting of
the Company's product lines for in vitro safety tests, Dr.
Chenoweth's position with the Company was changed in October 1996
from a full-time employee to a part-time consultant by mutual
agreement between the Company and Dr. Chenoweth.
STOCK OPTIONS
The following tables summarize stock option activity during the
fiscal year ended September 30, 1996 for each of the named officers shown
in the table under "Summary Executive Compensation" above:
<TABLE>
<CAPTION>
Option/SAR Grants in Last Fiscal Year Ended September 30, 1996
----------------------------------------------------------------------------
Potential Realizable
Value at Assumed
Number of % of Total Annual Rates of Stock
Securities Options/SARs Price Appreciation
Underlying Granted to Exercise or for Option Term
Options/SARs Employees in Base Price Expiration ------------------------
Name Granted (#) Fiscal Year ($/sh) Date 5% ($) 10% ($)
- --------------------- ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
W. Richard Ulmer -0- n/a n/a n/a n/a n/a
Dennis E. Chenoweth -0- n/a n/a n/a n/a n/a
</TABLE>
<TABLE>
<CAPTION>
-7-
<PAGE>
Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End Option/SAR Values
-----------------------------------------------------------------------------------------
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money
Options/SARs at Options/SARs at
at Fiscal Year-End (#)(1) at Fiscal Year-End ($)(2)
Shares Acquired Value ------------------------- -------------------------
Name on Exercise (#) Realized ($) Exercisable/Unexercisable Exercisable/Unexercisable
- ---------------------- --------------- ------------ ---------- -------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
W. Richard Ulmer -0- n/a 190,000 / 220,000 -0- / -0-
Dennis E. Chenoweth -0- n/a 90,000 (3)/ 120,000 (3) -0- / -0-
</TABLE>
- -------------------------------------
(1) All options listed in the table are exercisable at option prices
equal to fair market value on the date of grant.
(2) No unexercised options were in-the-money at September 30, 1996 based
upon the fair market value for the common stock on that date of
$9/16 per share.
(3) Options covering 150,000 shares listed in the table were cancelled
in October 1996 due to a change in Dr. Chenoweth's employment
status. As of December 31, 1996, Dr. Chenoweth held options to
purchase 60,000 shares exercisable at $1.00 per share of which
options for 40,000 shares were exercisable.
<TABLE>
<CAPTION>
Long-Term Incentive Plans -- Awards in Last Fiscal Year (1)
------------------------------------------------------------------
Performance
Number of or Other
Shares, Units Period Until
or Other Maturation
Name Rights or Payout Threshold Target Maximum
- ---------------------- ------------- ------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
W. Richard Ulmer -0- n/a (1) n/a n/a n/a
Dennis E. Chenoweth -0- n/a (1) n/a n/a n/a
</TABLE>
- -----------------------------------
(1) The Company does not have any compensation plans involving stock
appreciation rights or long-term incentive or deferred pension or
profit-sharing plans.
COMPENSATION OF DIRECTORS
Directors do not receive cash compensation for their services on the
Company's Board of Directors except for reimbursement of travel expenses.
Pursuant to the 1996 Stock Option Plan for Non-Employee Directors
(the "Director Plan"), on the first business day of each fiscal year each
non-employee director is automatically granted, without further action
by the Board, a stock option to purchase 25,000 shares of the Company's
Common Stock. The exercise price per share of all options granted under
the Director Plan is equal to 100% of the fair market value of the Common
Stock on the date of grant, but in no event less than $1.00 per share.
Options granted under the Director Plan are exercisable as to one-third
of the shares subject to such options on the first anniversary of the
date of grant and as to an additional one-third of the shares subject to
the option on each successive anniversary of the date of grant, provided
the optionee has continuously served as a member of the Board of
Directors through such date. Each option expires ten years after date
of grant. During the fiscal year ended September 30, 1996, options
covering a total of 75,000 shares were granted on October 2, 1995 to
three directors exercisable at an option price of $1.375 per share under
the Director Plan.
-8-
<PAGE>
David A. Reed received a stock option covering 25,000 shares of
Common Stock under the Company's 1992 Stock Option Plan at the date of
his election as a director on August 5, 1996. This option is fully
exercisable for a term of five years from the date of grant at an option
price of $1.00 per share. The closing price of the Company's Common
Stock on August 5, 1996 was $0.6875 per share.
The Company's Bylaws permit compensation of directors, and the Board
reserves the right to change its policy as to compensation of directors
from time to time.
EXECUTIVE EMPLOYMENT AGREEMENTS
The Company has a written employment agreement with W. Richard
Ulmer, its President and Chief Executive Officer.
The employment agreement with Mr. Ulmer executed in November 1995
provides for an annual base salary of $160,000. Effective October 1,
1995, Mr. Ulmer's base annual salary was reduced at his request to
$140,000 in consideration of additional stock options granted to Mr.
Ulmer on September 1, 1995 covering 160,000 shares exercisable at $1.00
per share vesting one-third annually from date of grant. At the time of
his employment, Mr. Ulmer received a stock option covering 250,000 shares
of the Company's common stock under the Company's 1992 Stock Option Plan
exercisable at $1.75 per share, the fair market value on date of grant
on November 7, 1994. Exercisability of that stock option vests one-third
each year commencing on the first anniversary date of his employment.
See "Stock Options" above. Additional stock options covering 250,000
shares and fully vested on date of grant will be granted to Mr. Ulmer and
will be exercisable at fair market value on date of grant if the Company
attains three consecutive fiscal quarters of positive earnings from
operations, as defined in the agreement, at any time through September
30, 1997. Mr. Ulmer's employment agreement further provides he is
entitled to severance pay if his employment is involuntarily terminated,
other than for cause, equal to 12 months base salary.
The employment agreement described contains inventions assignment
and confidentiality provisions in favor of the Company and requires the
executive officer to devote his full business time to the activities of
the Company.
STOCK OPTION PLANS
The Company provides a long-term incentives tied to performance of
its Common Stock through stock option plans. Plans in which employees
are eligible to participate are structured to allow a Stock Option
Committee and the Board of Directors discretion in creating equity
incentives for employees, officers, directors and consultants which
assist the Company in motivating and retaining the appropriate talent
needed to conduct its business.
Options to purchase the Company's Common Stock have been granted and
are currently outstanding under the Company's 1988, 1991 and 1992 stock
option plans (the "1988 Plan," "1991 Plan," and "1992 Plan",
respectively) and the 1996 Stock Option Plan for Non-Employee Directors
-9-
<PAGE>
("Director Plan"), collectively referred to as the "Option Plans". Each
of the Option Plans were adopted by the Board and approved by
shareholders. All options outstanding to date under the Option Plans
were granted at not less than 100% of market price for the Common Stock
on the date of grant.
All employees, officers and directors are eligible for grants under
the 1988, 1991 and 1992 Plans and non-employee directors are eligible for
grants under the Director Plan. The Company to date has generally
limited the grant of options under its Option Plans so that at no time
will there be outstanding options in the aggregate that would cover
shares numbering in excess of 10% of the number of shares of Common Stock
issued and outstanding, subject to discretionary adjustment by the Board
of Directors for unusual circumstances. Shares subject to options
outstanding and unexercised at September 30, 1996 under all the Option
Plans represented approximately 7.7% of the total Common Stock then
outstanding. If any option granted under the Option Plans expires or
terminates without having been exercised in full, the shares covered by
the unexercised portion of the option may be used again for new grants
under the plans.
The 1988, 1991 and 1992 Option Plans provide for the granting of
incentive stock options pursuant to Section 422 of the Internal Revenue
Code of 1986, as amended. The exercise price of all incentive stock
options for Common Stock granted under the Option Plans must be at least
equal to the fair market value of such shares on the date of grant. With
respect to any participant who owns stock possessing more than 10% of the
voting rights of the Company's outstanding capital stock, the exercise
price of any incentive stock option must be not less than 110% of fair
market value on the date of grant. In addition, the 1991 and 1992 Plans
provide that options granted thereunder may be either incentive stock
options or, at the discretion of the Company, stock options which do not
qualify as incentive stock options under the Code. To date, all options
granted under the 1988, 1991 and 1992 Plans are intended as incentive
stock options, except for options covering approximately 78,571 shares
under the 1992 Plan. Options granted under the Director Plan are not
intended to qualify as incentive stock options under the Code.
The maximum term for each option under the Option Plans is 10 years.
To date, options under the Director Plan have a term of ten years and no
option granted under the 1988, 1991 or 1992 Plans has a term in excess
of five years.
In the event of termination of employment, options under the 1988,
1991 or 1992 Plans will terminate and may be exercised during a three
month period after termination to the extent the option was exercisable
on the date of termination, but in no event after the date the option
would have expired in the absence of termination of employment. In the
event termination of employment was caused by death or permanent
disability, the period of exercisability is extended under the 1988, 1991
or 1992 Plans to one year after the date of termination, but in no event
after the date the option would have expired in the absence of
termination of employment.
If a participating director in the Director Plan terminates service
on the Board as the result of disability or mandatory retirement pursuant
to Board policy, previously granted options will continue to become
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<PAGE>
exercisable in accordance with their terms (one-third of the option may
be exercised after the first, second and third anniversary of the date
of grant) but must be exercised within five years of such termination and
in any event within 10 years of grant. In the event of the death of the
holder of any unexercised option under the Director Plan either while
serving on the Board or within five years after termination as the result
of disability or mandatory retirement, all of the holder's outstanding
options will become immediately exercisable by his or her legal
representative. If death occurs while the holder is a director,
unexercised options must be exercised within five years of death. If
death occurs after retirement, such options must be exercised within two
years of death or five years after retirement, whichever is later. If
a participating director terminates service on the Board for any reason
other than retirement, disability or death, his or her outstanding
options may be exercised only to the extent that they were exercisable
at the time of such termination and expire three months after such
termination.
No option granted under the Option Plans may be transferred by the
optionee other than by will or the laws of descent and distribution and
each option is exercisable during the lifetime of the optionee only by
such optionee. Adjustments will be made in the number and kind of
shares subject to the Option Plans and outstanding options, and in the
option price of outstanding options, in the event of any change in the
Company's outstanding shares by reason of any stock split or stock
dividend, recapitalization, merger, consolidation, combination or
exchange of shares or other similar corporate change.
1988 PLAN. The 1988 Plan was adopted and approved by shareholders
on July 28, 1988, and no options under the 1988 Plan may be granted after
July 28, 1998. The 1988 Plan covers options for up to 150,000 shares of
Common Stock. At September 30, 1996, options to purchase 140,600 shares
had been exercised under the 1988 Plan, unexercised options were
outstanding to purchase 4,000 shares of Common Stock (all of which are
exercisable in the fiscal year ending September 30, 1997) at an average
exercise price of $1.00 per share, and up to 5,400 shares were available
for future grants of options under the 1988 Plan. As of September 30,
1996, no options exercisable under the 1988 Plan were held by executive
officers of InVitro.
1991 PLAN. The 1991 Plan was adopted on May 16, 1991 and approved
by shareholders on March 27, 1992, covering up to 300,000 shares of
Common Stock. At September 30, 1996, options to purchase 79,583 shares
had been exercised under the 1991 Plan, unexercised options were
outstanding to purchase 201,000 shares of Common Stock (all of which are
exercisable in the fiscal year ending September 30, 1997) at an average
exercise price of $1.08 per share, and up to 19,417 shares were available
for future grants of options under the 1991 Plan. As of September 30,
1996, options covering a total of 160,000 shares exercisable at an
average price of $1.00 per share were held by one executive officer of
the Company under the 1991 Plan.
1992 PLAN. The 1992 Plan was adopted on October 16, 1992 and
approved by shareholders on April 23, 1993, covering up to 1,000,000
shares of Common Stock. At September 30, 1996, options to purchase
46,225 shares had been exercised under the 1992 Plan, unexercised options
were outstanding to purchase 799,900 shares of Common Stock (of which
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<PAGE>
646,232 shares are exercisable in the fiscal year ending September 30,
1997) at an average exercise price of $1.46 per share, and up to 153,875
shares were available for future grants of options under the 1992 Plan.
As of September 30, 1996, options covering a total of 480,000 shares
exercisable at an average price of $1.41 per share were held by three
executive officers of the Company under the 1992 Plan.
DIRECTOR PLAN. The Director Plan was adopted on August 24, 1995
and approved by shareholders on January 26, 1996, covering up to 500,000
shares of Common Stock. At September 30, 1996, no options to purchase
shares had been exercised under the Director Plan, unexercised options
were outstanding to purchase 75,000 shares of Common Stock (of which
25,000 shares are exercisable in the fiscal year ending September 30,
1997) at an average exercise price of $1.35 per share, and up to 425,000
shares were available for future automatic grants of options under the
Director Plan. On October 1, 1996, the first business day of the fiscal
year ending September 30, 1996, options covering a total of 100,000
shares were granted automatically under the Director Plan to four
directors exercisable at an option price of $1.00 per share. See
"Compensation of Directors" above.
401(k) SAVINGS AND INVESTMENT PLAN
In 1991, the Board of Directors adopted the InVitro International
401(k) Retirement Plan (the "401(k) Plan") pursuant to which employees
may defer compensation for income tax purposes under Section 401(k) of
the Internal Revenue Code of 1986, as amended (the "Code"). All
qualifying employees are eligible for the 401(k) Plan and may contribute
to their accounts, subject to certain limitations set forth in the Code,
up to 20% of their compensation, as defined in the Plan. The Company
does not make any contributions to the Plan. The amount of deferred
compensation is not taxed to the employee until distributions upon
retirement, death, disability or termination of employment with the
Company. Amounts in each participant's account are invested at the
discretion of the participant among several investment alternatives.
Except as described above, the Company has no pension, retirement,
annuity, savings or similar benefit plan which provides compensation to
its executive officers or directors.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and directors, and persons who beneficially
own more than 10% of the Company's stock, to file initial reports of
ownership and reports of changes in ownership with the Securities and
Exchange Commission. Executive officers, directors and greater than 10%
beneficial owners are required by applicable regulations to furnish the
Company with copies of all Section 16(a) forms they file.
Based solely upon a review of the copies of such forms furnished to
the Company, responses from the Company's executive officers and
directors in reply to monthly questionnaires, and information involving
securities transactions of which the Company is aware, the Company
believes that during the fiscal year ended September 30, 1996 all Section
16(a) filing requirements applicable to its executive officers, directors
and greater than 10% beneficial shareholders were complied with.
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<PAGE>
PROPOSAL 2 -- AUTHORIZATION OF 1-FOR-10 REVERSE STOCK SPLIT
CONSIDERATIONS AS TO THE PROPOSED AMENDMENT
The Company's Board of Directors believes it is advisable for the
issued and outstanding shares of the Company's Common Stock to be
recapitalized, by means of a 1-for-10 reverse stock split, into a lesser
number of shares of Common Stock issued and outstanding (the "Reverse
Stock Split").
As of December 31, 1996, there were 14,028,300 shares of Common
Stock issued and outstanding. In addition, the Company has reserved an
aggregate of 2,114,641 shares of its Common Stock for possible future
issuance pursuant to outstanding stock options and warrants described in
the table below. In the event the Reverse Stock Split is approved, the
following table indicates the shares of Common Stock that would be
outstanding and reserved for outstanding options and warrants after
giving effect to the 1-for-10 Reverse Stock Split:
<TABLE>
<CAPTION>
After Proposed 1-for-10
Common Stock: Pre-Split Reverse Stock Split (1) Footnotes
- -------------------------------- ---------- ----------------------- ---------
<S> <C> <C> <C>
Outstanding at December 31, 1996 ........... 14,028,300 1,402,830
Common Stock reserved for:
Outstanding stock options:
1988 Stock Option Plan .................. 4,000 400 (2)
1991 Stock Option Plan .................. 211,000 21,100 (3)
1992 Stock Option Plan .................. 649,900 64,990 (4)
1996 Non-Employee Directors
Stock Option Plan ..................... 175,000 17,500 (5)
Outstanding common stock purchase warrants:
Series B expiring May 28, 1997 .......... 270,000 27,000 (6)
Series C expiring February 16, 1998 ..... 229,741 22,975 (7)
Series D expiring January 31, 1999 ...... 250,000 25,000 (8)
Series E expiring January 31, 1999 ...... 250,000 25,000 (8)
Series F expiring March 31, 1999 ........ 75,000 7,500 (9)
---------- ---------
Totals ........................... 16,142,941 1,614,295
========== =========
</TABLE>
- ---------------------------
(1) Fractional shares resulting from the Reverse Stock Split will be
rounded up to the nearest full share. Accordingly, amounts in the
above table may be increased by nominal amounts for rounding up of
fractional interests.
(2) Options currently exercisable at $1.00 per share; option exercise
prices will be adjusted to $10.00 per share if the Reverse Stock
Split is approved.
(3) Options currently exercisable ranging from $1.00 to $1.875 per
share; option exercise prices will be adjusted to range from $10.00
to $18.75 per share if the Reverse Stock Split is approved.
(4) Options currently exercisable ranging from $1.00 to $5.00 per share;
option exercise prices will be adjusted to range from $10.00 to
$50.00 per share if the Reverse Stock Split is approved.
(5) Options currently exercisable ranging from $1.00 to $1.375 per
share; option exercise prices will be adjusted to range from $10.00
to $13.75 per share if the Reverse Stock Split is approved.
(6) Series B warrants are currently exercisable at $3.50 per share; the
warrant exercise price will be adjusted to $35.00 per share if the
Reverse Stock Split is approved.
(7) Series C warrants are currently exercisable at $4.00 per share; the
warrant exercise price will be adjusted to $40.00 per share if the
Reverse Stock Split is approved.
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<PAGE>
(8) Series D and Series E warrants are currently exercisable at $1.75
per share; the warrant exercise price will be adjusted to $17.50 per
share if the Reverse Stock Split is approved.
(9) Series F warrants are currently exercisable at $1.25 per share; the
warrant exercise price will be adjusted to $12.50 per share if the
Reverse Stock Split is approved.
The proposed 1-for-10 Reverse Stock Split is deemed advisable to
increase the per share price of the Company's Common Stock and decrease
the number of securities outstanding, with a view to placing the Company
in a better position to maintain the listing of its Common Stock on The
Nasdaq SmallCap Market. To remain eligible for continued listing on The
Nasdaq SmallCap Market under current requirements, the Company's Common
Stock must maintain a minimum bid price of $1.00 or, as an alternative
if the bid price is less than $1.00, maintain capital and surplus of
$2,000,000 and a market value of the public float of $1,000,000.
However, the Nasdaq Stock Market recently announced proposed rule changes
that would, among other proposed changes, eliminate the alternative test
and require removal of listed status for any security trading at less
than a minimum bid price of $1.00 per share. Bid prices for the
Company's Common Stock have been consistently less than $1.00 per share
throughout the period from July 23, 1996 through December __, 1996. As
of December __, 1996, the closing bid price for the Company's Common
Stock as quoted by The Nasdaq SamllCap Market was $____ per share.
The Board also believes that a higher market price per share may
enable the Company to better avail itself of equity financing or
acquisition opportunities in the future. There can be no assurance,
notwithstanding the Reverse Stock Split, that the Company's Common Stock
will remain qualified for listing on The Nasdaq SmallCap Market or on
another securities exchange.
One disadvantage of a Reverse Stock Split is that certain holders
of the Company's Common Stock currently holding so-called "round lots"
(i.e., 100 shares or an even multiple of 100 shares) may no longer own
round lots and may incur higher commissions on the sale of their shares
which are typically charged for odd lot transactions. Other possible
disadvantages include the prospect that the overall value of shares
affected by a Reverse Stock Split may decline notwithstanding the fact
that the percentage ownership of each Common Stock shareholder in the
equity of the Company will not change.
After considering all of the above factors, the Board of Directors
has recommended that stockholders adopt Proposal 2 which would approve
an amendment to the Company's articles of incorporation for the purpose
of effecting a 1-for-10 Reverse Stock Split with respect to its issued
and outstanding Common Stock.
PROPOSED AMENDMENT; CONVERSION OF SHARES
If Proposal 2 to approve a 1-for-10 Reverse Stock Split is adopted,
an amendment to the articles of incorporation would reduce the authorized
number of shares of Common Stock from 40 million to 4 million shares.
In addition, the following sentences will be added to the first paragraph
of Article III to the Company's articles of incorporation:
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<PAGE>
"Each share of the corporation's Common Stock issued and
outstanding as of the close of business on __________, 1997
shall be automatically converted into one-tenth (1/10th) of
one share of the Common Stock of the Corporation. Any
fractional share that would otherwise exist as a result of
such conversion shall be rounded up to the nearest full
share."
Based upon the 14,028,300 shares of Common Stock issued and outstanding
as of December __, 1996, after the Effective Date the Company would have
approximately 1,402,830 shares of Common Stock issued and outstanding
without giving effect to shares reserved for issuance as described in the
table above.
If Proposal 2 is approved, the 1-for-10 Reverse Stock Split will
become effective at the close of business on a date selected by the
Company's management (the "Effective Date"). On the Effective Date, the
Reverse Stock Split will result in one share of Common Stock, without par
value, being outstanding for each ten (10) issued and outstanding shares
of Common Stock, without par value. Outstanding shares will be
automatically converted without any action on the part of shareholders
of the Company and without regard to the date or dates certificates
representing shares of Common Stock are, at the option of shareholders,
physically surrendered for transfer or exchange.
Any fractional share which might result from the Reverse Stock Split
will be rounded up to a full share.
Each existing certificate representing shares of the Company's
Common Stock will, until surrendered or exchanged as described below, be
deemed, for all corporate purposes, to evidence ownership of the whole
number of shares of the Company's Common Stock as appropriately adjusted
for the Reverse Stock Split and if transferred or sold, will
automatically be reissued in the transferee's name in the new post-split
number of shares. Further, any rights to acquire Common Stock under
outstanding options and warrants as of the Effective Date will be subject
to automatic adjustment to reflect the 1-for-10 reverse split of the
Common Stock.
Shareholders need not contact the Company or its transfer agent as
a result of the Reverse Stock Split. Upon the Effective Date of the
Reverse Stock Split, the Company's transfer agent will mail transmittal
forms to all holders of record of the Common Stock in the event
shareholders desire to request issuance of a new certificate. The
Company's transfer agent, American Stock Transfer & Trust Company, 40
Wall Street, 46th Floor, New York, New York 10005, telephone number (718)
921-8200, will effect the exchange of certificates after the Effective
Date.
The Board of Directors unanimously approved the adoption of Proposal
2 for the Reverse Stock Split as of December 9, 1996, and recommends that
shareholders vote FOR the adoption of Proposal 2. An affirmative vote
by the holders of a majority of the voting rights represented by shares
of Common Stock entitled to vote at the Meeting is required for approval
of Proposal 3. Unless indicated to the contrary, the enclosed proxy will
be voted FOR adoption of Proposal 2.
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<PAGE>
COMPARATIVE STOCK PERFORMANCE GRAPH
The following graph sets forth the change in the Company's
cumulative shareholder return on its Common Stock at the end of each of
the last five fiscal years. The graph is based upon the market price
for InVitro's Common Stock compared with the cumulative total returns of
(i) the NASDAQ Composite Index and (ii) an index of a group of peer
companies in the biotechnology field with similar market capitalizations
selected by the Company, consisting of Biocircuits Corp., Gamma
Biologicals Inc., Gull Laboratories Inc., Incstar Corp., Meridian
Diagnostics Inc. and Synbiotics Corp.
{GRAPH INSERTED HERE}
<TABLE>
<CAPTION>
9/30/91 9/30/92 9/30/93 9/30/94 9/30/95 9/30/96
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
InVitro 100.00 31.42 360.45 54.56 39.68 14.88
NASDAQ
Composite 100.00 110.70 144.77 145.06 198.06 232.87
Peer Group 100.00 116.79 104.06 78.90 120.24 154.70
</TABLE>
(1) The changes in the above graph are based upon the assumption that
$100 had been invested in InVitro Common Stock, in the NASDAQ
Composite Index and in the peer group index on September 30, 1991.
The total cumulative dollar returns on the graph represent the value
that such investments would have had at each of the dates indicated
assuming, where applicable, reinvestment of dividends.
(2) Prices of InVitro Common Stock reflected in the above table include
the $3.78 on September 30, 1991, $1 3/16 on September 30, 1992, $13
5/8 on September 30, 1993, $2 1/16 on September 30, 1994, $1 1/2 on
September 29, 1995 and $ 9/16 on September 30, 1996.
CERTAIN TRANSACTIONS
AGREEMENT WITH MIRAGEN INC.
The Company entered into a Distributorship Agreement on March 11,
1996 to market the Guardian-DNA identification system developed and
supplied by Miragen Inc. ("Miragen"), of Irvine, California. The Company
believes that Guardian DNA is an effective, long-term identification
system that overcomes limitations inherent in traditional fingerprint and
photograph identification methods, as well as providing additional
instructional information and materials for parents relating to child
safety.
The Company holds exclusive rights to market and distribute Guardian
DNA products to birthing centers, hospitals and other institutional
obstetric markets such as pediatricians and obstetricians, in the U.S.
and abroad for an initial three year term, renewable annually thereafter.
To maintain exclusive marketing rights under the Distributorship
Agreement, the Company is required to attain minimum purchase quotas in
various periods during the term of the Distributorship Agreement, ranging
from at least 20,000 in the first year and thereafter at minimum levels
ranging up to 50,000 units per month in the last six months of the third
year.
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<PAGE>
Two of the Company's officers, directors and shareholders, Messrs.
Irwin J. Gruverman and William M. Curtis, are also officers, directors
and shareholders of Miragen Inc., which was founded in March 1993.
Messrs. Gruverman and Curtis both abstained from participating in the
negotiation of the Company's Distributorship Agreement with Miragen Inc.
The Board of Directors believes that the terms of its Distributorship
Agreement with Miragen are no less favorable to InVitro than could have
been obtained from an independent third party, and the Distributorship
Agreement has been approved by all disinterested members of the Company's
Board of Directors.
OTHER
William M. Curtis, a director and corporate Secretary of the
Company, renders corporate legal services to the Company. During the
fiscal year ended September 30, 1996, legal fees accrued by the Company
for legal services rendered by Mr. Curtis were $25,000.
GENERAL
INDEPENDENT PUBLIC ACCOUNTANTS
McGladrey & Pullen, L.L.P. acted as the Company's independent public
accountants for the fiscal years ending September 30, 1996 and 1995.
McGladrey & Pullen, L.L.P. has advised the Company it had no direct or
indirect financial interest in the Company during the time it has acted
as independent auditor for the Company. The Company expects that a
representative of McGladrey & Pullen, L.L.P. will be present at the
Annual Meeting and will have the opportunity to make a statement, if he
or she so desires, and that such representative will be available to
respond to appropriate questions.
SUBMISSION OF SHAREHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
Any proposal, relating to a proper subject, which a shareholder may
intend to present for action at the 1998 Annual Meeting of Shareholders,
and which such shareholder may wish to have included in the Company's
proxy materials for such meeting, in accordance with the provisions of
Rule 14a-8 promulgated under the Securities Exchange Act of 1934, must
be received in proper form by the Company at its principal office not
later than ________, 1997. It is suggested any such proposal be submitted
by certified mail - return receipt requested.
ANNUAL REPORT ON FORM 10-KSB
A copy of InVitro's Annual Report on Form 10-KSB for the fiscal year
ended September 30, 1996, without exhibits, as filed with the Securities
and Exchange Commission ("Commission"), is included in the Annual Report
mailed with this Proxy Statement and is otherwise available to
stockholders without charge upon written request addressed to Cheryl
Daniel, InVitro International, 16632 Millikan Avenue, Irvine, California
92606. Reports, proxy statements and other information filed by the
Company with the Commission subsequent to May 6, 1996 are also available
through the Commission's EDGAR Database of Corporate Information which
can be accessed on the Internet at the Commission's URL address,
http://www.sec.gov/edgarhp.htm
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<PAGE>
OTHER BUSINESS
Management is not aware of any matters to come before the Annual
Meeting other than those stated in this Proxy Statement. However,
inasmuch as matters of which management is not now aware may come before
the meeting or any adjournment thereof, the proxies confer discretionary
authority with respect to acting thereon, and the persons named in such
proxies intend to vote, act and consent in accordance with their best
judgment with respect thereto. Upon receipt of such proxies, in the form
enclosed and properly signed, in time for voting, the shares represented
thereby will be voted as indicated thereon and in this Proxy Statement.
By Order of the Board of Directors,
William M. Curtis, Secretary
Irvine, California
____________, 1996
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<PAGE>
<PAGE>
INVITRO INTERNATIONAL
ANNUAL MEETING OF SHAREHOLDERS
JANUARY 31, 1997
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned shareholder of INVITRO INTERNATIONAL hereby appoints
IRWIN J. GRUVERMAN, W. RICHARD ULMER and WILLIAM M. CURTIS, and each of
them, the true and lawful attorneys, agents and proxies of the
undersigned, with full power of substitution to each of them, to vote all
shares of common stock which the undersigned may be entitled to vote at
the Annual Meeting of Shareholders of the Corporation to be held on
January 31, 1997, and at any adjournment of such meeting, with all powers
which the undersigned would possess if personally present, for the
following purposes:
(Continued and to be signed on the other side)
<PAGE>
<PAGE>
[X] Please mark your
votes as in this
example.
<TABLE>
<S> <C> <C> <S> <C> <C> <C>
1. FOR WITHHELD 2. FOR AGAINST WITHHELD
Election of [ ] [ ] [ ] [ ] [ ]
Directors
A proposal authorizing an amendment to the Company's articles
Nominees: DENNIS E. CHENOWETH, of incorporation to effect a 1-for-10 reverse stock split as
WILLIAM M. CURTIS, to the outstanding Common Stock.
IRWIN J. GRUVERMAN,
DAVID A. REED, 3. FOR AGAINST WITHHELD
JEFFREY A. SAFCHIK and [ ] [ ] [ ]
W. RICHARD ULMER
Considering and acting upon any other matter which may properly
FOR, except vote withheld from come before the meeting or any adjournment thereof.
the following nominee(s):
- -------------------------------------------
</TABLE>
This Proxy when properly executed will
be voted in the manner directed herein
by the undersigned shareholder. If no
direction is made, this proxy will be
voted "FOR" the election of the
director nominees listed, "FOR" the
approval of Proposal 2, and in
accordance with the best judgment of
the proxies on any other matters which
may properly come before the meeting.
If cumulative voting procedures are
invoked at the meeting, and this proxy
card indicates "FOR" or gives no
direction on Proposal 1, the designated
proxies are authorized to distribute
the votes represented by this proxy in
their discretion so as to elect the
maximum number of management nominees
which may be elected by cumulative
voting.
The undersigned acknowledges receipt of
the Notice of Annual Meeting and Proxy
Statement dated December __, 1996.
PLEASE MARK, SIGN, DATE AND MAIL THIS
PROXY IN THE ENVELOPE PROVIDED
SIGNATURE(S) _______________________________ DATE ____________________
NOTE: Please sign exactly as name appears hereon. Joint owners
should each sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as
such.
