Exhibit 5.1
BIOVAIL CORPORATION
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NOTICE TO STOCKHOLDERS OF
INTELLIGENT POLYMERS LIMITED
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This information is disseminated pursuant to Rule 13e-3 of the
Securities Exchange Act of 1934, as amended.
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
FAIRNESS OR MERITS OF SUCH TRANSACTION NOR UPON THE ACCURACY OR ADEQUACY OF THE
INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
THE TRANSACTION
Biovail Corporation, an Ontario corporation ("Biovail"), wishes to advise
holders of Common Stock ("Common Shares"), par value $0.01, of Intelligent
Polymers Limited, a Bermuda corporation ("Intelligent Polymers"), that Biovail
filed a Schedule 13e-3 Transaction Statement (the "Statement") with the
Securities and Exchange Commission on August 31, 2000. The statement relates to
the potential exercise by Biovail of its option to purchase all issued and
outstanding shares of Common Stock of Intelligent Polymers (the "Purchase
Option").
The filing of the Statement and the receipt and of this notice do not
constitute an exercise of the option described above. Exercise of such option
must be done pursuant to the Bye-Laws of Intelligent Polymers. Biovail has not
exercised the Purchase Option as of the date of this notice.
The Statement was filed by Biovail. Notwithstanding the Statement, Biovail
does not believe that the transaction reported herein (the "Transaction") is
subject to Rule 13e-3 under the Securities Exchange Act of 1934, as amended.
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SUMMARY TERM SHEET
This Summary Term Sheet highlights selected information contained in this
Notice to Stockholders and may not contain all of the information that is most
important to you. We urge you to read this entire Notice to Stockholders
carefully.
o Biovail Corporation has filed a Schedule 13e-3 Transaction Statement
with the Securities and Exchange Commission which relates to the
potential exercise of its option to purchase all the Common Stock of
Intelligent Polymers Limited. The Bye-laws of Intelligent Polymers
provide that the holder of a majority of the Special Shares of
Intelligent Polymers has an option to purchase all the issued and
outstanding Common Stock. Biovail is the holder of a majority of the
Special Shares of Intelligent Polymers. See "Background and Summary of
Transaction -- Identification of Biovail"
o Biovail would pay $39.06 per share of Intelligent Polymers Common
Stock. See "Background and Summary of Transaction--Terms of
Transaction."
o The transaction would close on September 29, 2000. See "Background and
Summary of Transaction--Terms of Transaction."
o Biovail may exercise its option to purchase all the Common Stock of
Intelligent Polymers without seeking the prior approval of the
Intelligent Polymers shareholders. As such, shareholders are not being
asked to vote to approve this purchase. See "Special Factors --
Fairness of the Transaction."
o The exercise of the Purchase Option would be a fully taxable
transaction to the Intelligent Polymers Shareholders. See "Certain
Material U.S. Federal Income Tax Consequences". See "Special Factors--
Certain U.S. Federal Income Tax Matters."
o Following the purchase of the Intelligent Polymers Common Stock,
Intelligent Polymers Common Stock would be de-listed from the American
Stock Exchange and Intelligent Polymers would have its public
reporting obligations suspended. See "Special Factors -- Purposes,
Alternatives, Reasons and Effects of the Transaction."
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SPECIAL FACTORS
Purposes, Alternatives, Reasons and Effects of the Transaction.
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The purpose of the Transaction would be to acquire the rights to all
products and product candidates developed or under development by Biovail and
Intelligent Polymers pursuant to the Development Contract dated September 30,
1997 between Biovail and Intelligent Polymers.
As Biovail would be exercising certain previously granted rights, no other
options were considered.
The Transaction would be structured pursuant to the terms of the previously
granted Purchase Option as set forth in the Bye-Laws. The Purchase Option would
be exercised at this time based on Biovail's belief that exercise at this time
is in the best interest of its shareholders. Additionally, Biovail would avoid a
25% increase in the Purchase Option price which occurs after September 30, 2000.
Subsequent to the transaction, Intelligent Polymers would become
wholly-owned by Biovail. Biovail anticipates that Intelligent Polymers would be
delisted from the AMEX and its reporting requirements with the Securities and
Exchange Commission suspended through the filing of a Form 15.
The Transaction would cause each holder of Common Shares ("Shareholder") to
dispose of his or her Common Shares for the Purchase Option consideration
("Purchase Option Consideration"). The Purchase Option Consideration is the
amount specified in the Bye-Laws of Intelligent Polymers (the "Bye-Laws").
Certain Material U.S. Federal Income Tax Consequences
The following discussion is a summary of certain material U.S. federal
income tax consequences to "U.S. Shareholders" (generally a U.S. citizen or
resident, a corporation under U.S. law or a trust or estate that is considered a
"United States person") if Biovail exercises the Purchase Option. This
discussion is based upon laws, regulations, rulings and decisions currently in
effect, all of which are subject to change, retroactively or prospectively.
This discussion does not apply to persons other than U.S. Shareholders and
may not apply to certain categories of U.S. Shareholders subject to special
treatment under the Internal Revenue Code of 1986, as amended (the "Code"), such
as passthrough entities, dealers or traders in securities or currencies, banks,
insurance companies, U.S. Shareholders that do not hold the Common Shares as
capital assets, persons whose "functional currency" is not the U.S. dollar,
tax-exempt entities and persons that hold Common Shares as a position in a
straddle or as part of a "hedging", "integrated", "constructive sale" or
"conversion" transaction. Moreover, the discussion summarizes only federal
income tax consequences and does not address any state, local or other tax
consequences.
SHAREHOLDERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS TO DETERMINE THE
SPECIFIC TAX CONSEQUENCES OF THE TRANSACTION TO THEM.
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Upon Biovail's exercise of the Purchase Option, a U.S. Shareholder would
recognize a capital gain or loss on each Common Share disposed of equal to the
difference between the amount of (a) the cash received for the Common Share and
(b) his basis in the Common Share. Gain or loss upon the disposition of a Common
Share generally should be long-term if the Common Share has been held for more
than one year at the time of the exercise of the Purchase Option.
To the extent that a U.S. Shareholder has not provided an appropriate
taxpayer identification number on IRS Form W-9 or a substitute therefor, such
U.S. Shareholder may be subject to backup withholding by Biovail.
Fairness of the Transaction
Biovail reasonably believes that the Transaction would be fair to
Shareholders.
The material factors upon which the belief stated above is based is set
forth below.
The Purchase Option was a feature of the Common Shares from the time of
Intelligent Polymers' inception. The Purchase Option and the Purchase
Option Consideration were set forth in the Bye-Laws and described in
the prospectus dated October 10, 1997, distributed in connection with
the initial public offering of the Common Shares (the "Prospectus").
Both the Bye-Laws and the Prospectus were publicly filed with the
Securities and Exchange Commission. Pursuant to the Bye-Laws, the stock
certificates for the Common Shares were legended to put the holders
thereof on further notice about the Purchase Option. Intelligent
Polymers' Annual Reports on Form 20-F have described the Purchase
Option and the Purchase Option Consideration. As a result of the
foregoing, Biovail believes that Shareholders received adequate notice
as to the terms of the Purchase Option prior to making any investment
decision with respect to the Common Shares.
The exercise of the Purchase Option and consummation of the Transaction do
not require the approval of Shareholders.
After making reasonable inquiry of management of Intelligent Polymers,
Biovail believes that no directors of Intelligent Polymers have retained an
unaffiliated representative to act solely on behalf of any Shareholders, as no
action is required by Shareholders to effect the Purchase Option.
The exercise of the Purchase Option and the consummation of the Transaction
do not require the approval of Board of Directors of Intelligent Polymers.
Reports, Opinions, Appraisals and Negotiations
Neither Biovail nor, to the best of Biovail's knowledge after reasonable
inquiry of management of Intelligent Polymers, Intelligent Polymers, has
received any report, opinion (other than an opinion of counsel) or appraisal
from an outside party which is materially related to the Transaction.
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BACKGROUND AND SUMMARY OF TRANSACTION
Identification of Intelligent Polymers
The issuer of the class of equity security which is the subject of the
Statement and the address of its principal executive offices is:
Intelligent Polymers Limited
c/o Conyers Dill & Pearman
Clarendon House
2 Church Street
Hamilton HM 11, Bermuda
The exact title of the class of security which is the subject of the
Statement is Common Stock, par value $0.01, of Intelligent Polymers Limited (the
"Common Shares"). The number of Common Shares outstanding as of August 30, 2000,
the most recent practicable date, is 3,737,500. The approximate number of
holders of record of the Common Shares as of August 1, 2000, the most recent
practicable date, is 521.
Until September 30, 1999 (the "Separation Date"), the Common Shares were
part of a Unit (the "Units") consisting of one Common Share and one warrant to
purchase common shares of Biovail. The Units were traded on the American Stock
Exchange (the "AMEX") under the symbol IXP.u. On the Separation Date, the Units
separated into the two underlying securities. The IPL Common Shares now trade on
the AMEX under the symbol IXP, and the Biovail Warrants now trade on the New
York Stock Exchange under the symbol BVFw. The following table sets forth the
high and low prices on the AMEX for the Units until the Separation Date and for
the Common Shares after the Separation Date, as reported by the AMEX.
On September 30, 1999 the closing price of the Units was $46.50.
High Low
Units
Fiscal 1998:
2nd Quarter................................ 22.18 17.75
3rd Quarter................................ 31.38 20.75
4th Quarter................................ 30.38 19.75
Fiscal 1999:
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1st Quarter................................ 23.13 16.63
2nd Quarter................................ 28.00 16.50
3rd Quarter................................ 30.88 25.63
4th Quarter................................ 41.88 28.00
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Fiscal 2000:
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1st Quarter................................ 53.13 42.25
Common Shares
2nd Quarter (1)............................ 33.50 30.00
3rd Quarter................................ 34.625 31.50
4th Quarter................................ 37.50 34.00
(1) The Units separated in 2nd Quarter Fiscal 2000.
On August 30, 2000 the Common Shares closed at $37.625.
Intelligent Polymers has not paid any dividends on the Common Shares in the
past two years.
Pursuant to Section 3.9(E) of the Bye-Laws, until the expiration date of
the Purchase Option, no resolution or act of Intelligent Polymers to authorize
or permit the declaration or payment of dividends or the making of another
distribution to shareholders will be effective without the prior written
approval of the holders of a majority of the Special Shares (as defined below).
Identification of Biovail
The Statement was filed by Biovail. Biovail's business address and
telephone number are:
Biovail Corporation
2488 Dunwin Drive
Mississauga, Ontario
Canada L5L 1J9
(415) 285-6000
Biovail is the holder of all the issued and outstanding special shares (the
"Special Shares"), par value $1.00 per share, of Intelligent Polymers. The
Special Shares confer on Biovail certain limited rights, including the right to
appoint one director to the Board of Directors of Intelligent Polymers and the
right to purchase all, but not less than all, of the outstanding Common Shares
of Intelligent Polymers at the time such right is exercised (the "Purchase
Option"). The Special Shares do not entitle Biovail to vote at any meeting of
holders of Common Shares ("Shareholders") and do not entitle Biovail to receive
any dividend or any other distribution, or any right or interest in the profits
of assets of Intelligent Polymers.
Pursuant to the Bye-Laws, until the expiration of the Purchase Option, no
resolution or act of Intelligent Polymers to authorize or permit any of the
following will be effective without the prior written approval of the holder of
the majority of the Special Shares: (i) the allotment or issue of shares or
other securities of Intelligent Polymers or the creation of any right to such
allotment or issue; (ii) the reduction of Intelligent Polymers' authorized share
capital; (iii) outstanding borrowings
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by Intelligent Polymers in excess of an aggregate of $1.0 million; (iv) the sale
or other disposition of, or the creation of any lien or liens on, the whole or a
part of Intelligent Polymers' undertaking or assets; (v) the declaration or
payment of dividends or the making of any other distributions to shareholders;
(vi) the amalgamation of Intelligent Polymers; and (vii) any alteration of the
Purchase Option. Biovail, as the holder of a majority of the outstanding Special
Shares, could preclude the holders of a majority of the outstanding Common
Shares and the Board of Directors of Intelligent Polymers from taking any of the
forgoing actions during such period.
Biovail is an international, fully-integrated pharmaceutical company that
specializes in the development, manufacture, marketing and licensing of drugs
utilizing advanced controlled-release, rapid dissolve, enhanced absorption and
taste masking technologies.
During the past five years Biovail has not been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors). During the
past five years Biovail has not been a party to any judicial or administrative
proceeding (except for matters that were dismissed without sanction or
settlement) that resulted in a judgment, decree or final order enjoining further
violations of, or prohibiting activities, subject to, federal or state
securities laws or finding any violation of such laws.
Information Regarding Biovail's Officers and Directors
Eugene N. Melnyk
Chelston Park Building 2
Colleymore Rock
St. Michael BH1
Barbados, West Indies
Mr. Melnyk has been the Chairman of the Board and a Director since March
29, 1994, the effective date of the amalgamation (the "Amalgamation") of
Biovail's predecessor entities, Biovail Corporation International ("BCI") and
Trimel Corporation ("Trimel"). Prior to that time, he had been the Chairman of
the Board of BCI since October 1991 and was instrumental in acquiring, financing
and organizing the companies or businesses that comprised BCI. Mr. Melnyk also
founded Trimel and served as its President and Chief Executive Officer from 1983
through July 1991. Mr. Melnyk is Chairman of the Board of Directors of
Intelligent Polymers. Mr. Melnyk is a citizen of Canada.
Bruce D. Brydon
2488 Dunwin Drive
Mississauga, Ontario
Canada, L5L 1J9
Mr. Brydon has been the Chief Executive Officer since November 1997. He
joined Biovail as the Chief Executive Officer and President in January 1995 and
has been a Director since May 1995. Prior to that time and since 1990 he had
been President, Managing Director and Chairman of the Board of the Canadian
Operations of Boehringer Mannheim. In the late 1980s, Mr. Brydon served as
President and CEO of Beiersdorf Canada. Mr. Brydon is a citizen of Canada.
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Robert A. Podruzny
2488 Dunwin Drive
Mississauga, Ontario
Canada, L5L 1J9
Mr. Podruzny has been the President and Chief Operating Officer since
November 1997. He joined Biovail as Vice President, Finance and Chief Financial
Officer in January 1996. Mr. Podruzny is a Director of Biovail. He came to
Biovail from Browning-Ferris Industries Ltd. where he served as the Chief
Financial Officer and as a Director of the Canadian operations from 1993 to
1995. From 1987 to 1992, Mr. Podruzny served as General Manager of the U.S.
Health Promotion Division of MDS Health Group, a Toronto-based medical services
company. Mr. Podruzny is a citizen of Canada.
Kenneth C. Cancellara, Q.C.
2488 Dunwin Drive
Mississauga, Ontario
Canada, L5L 1J9
Mr. Cancellara joined Biovail as Senior Vice President and General Counsel
in March 1996, was appointed Secretary in April 1996, and has been a Director
since May 1995. Prior to that time, Mr. Cancellara was a partner with the law
firm of Cassels, Brock and Blackwell since 1980 where he held many positions,
including Chairman of the Executive Committee and managing partner. Mr.
Cancellara is a citizen of Canada.
Rolf K. Reininghaus
2488 Dunwin Drive
Mississauga, Ontario
Canada, L5L 1J9
Mr. Reininghaus has been a Senior Vice President and a Director since the
Amalgamation and has been President of Crystaal since November 1997. Prior to
that time, he had been the President, Chief Operating Officer and a Director of
BCI since October 1991 and Executive Vice President and a Director of Trimel or
its affiliates since November 1987. Prior to his employment by Trimel, Mr.
Reininghaus was the Marketing Manager of the Canadian operations of Miles
Pharmaceuticals, a division of Bayer AG. Mr. Reininghaus is a citizen of Canada.
Brian H. Crombie
2488 Dunwin Drive
Mississauga, Ontario
Canada, L5L 1J9
Mr. Crombie joined Biovail as Senior Vice President, and Chief Financial
Officer in May 2000. Mr. Crombie came to Biovail from The Jim Pattison Group,
one of Canada's largest private holding companies where he served as Managing
Director Corporate Finance from 1998 to 2000 where he was responsible for
corporate development and treasury. Prior to that time, he spent 7 years
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in finance and general management positions with The Molson Companies most
recently as SVP Corporate Finance and Treasurer responsible for planning,
accounting and control, corporate development, treasury and investor relations.
Mr. Crombie is a graduate of The Harvard School of Business where he received
his Masters in Business Administration. Mr. Crombie is a citizen of Canada.
Kenneth S. Albert, Ph.D.
3701 Concorde Parkway
Chantilly, VA 20151
Dr. Albert joined Biovail as Vice President, Chief Scientific Officer in
January 1999. Dr. Albert came to Biovail from Schein Pharmaceutical Inc., where
he had been the Vice President, Research and Development from 1995 to 1998.
Prior to his tenure at Schein, Dr. Albert was Corporate Director, Research and
Development at Forest from 1988 to 1995 and prior to that time he spent 14 years
in senior Research and Development positions at the Upjohn Company and Merck,
Sharp and Dohme. Dr. Albert is a citizen of the United States.
Wilfred G. Bistrow
467 Mountsberg Rd
RR#2
Campbellville, ONT
Canada, LOP IRO
Mr. Bristow has been a Director since the Amalgamation. Prior to that time,
he was a Director of BCI since January 1993. Mr. Bristow is and has been a
senior investment advisor at Nesbitt Burns Inc., a Canadian investment banking
firm, since December 1991. From September 1975 to December 1991, he served as
vice president and director of Richardson Greenshields of Canada, an investment
banking firm. Mr. Bristow is a citizen of Canada.
Paul W. Haddy
68 Durants
"Daydreams Christ Church" Building
Barbados, West Indies
Mr. Haddy was elected to the Board of Directors in June 2000. Mr. Haddy has
been Chairman and Chief Executive Officer of London Life Bank and Trust Company
since 1991. Mr. Haddy is a citizen of Canada.
Roger Rowan
53 Buckingham Avenue
Toronto, ONT
Canada M4N 1R3
Mr. Rowan was elected to the Board of Directors in June 1997. Mr. Rowan has
been President and Chief Operating Officer of Watt Charmichael Inc., a private
investment firm, since May
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1994. Prior thereto, Mr. Rowan was the Executive Vice President and Chief
Operating Officer of Watt Charmichael Inc. since 1991. Mr. Rowan is a citizen of
Canada.
Robert Vujea
1030 Carpenter Ave.
Grand Rapids, Michigan 49504-3727
Mr. Vujea was elected to the Board of Directors in June 1997. Mr. Vujea has
been President of R & D Chemical Corporation, a chemical manufacturer and
distributor, since 1974. Prior thereto, Mr. Vujea has held senior management
positions within a number of companies including American Greeting Card
Corporation, Cole National Corporation and Diverco Incorporated. Mr. Vujea is a
citizen of the United States.
During the past five years, none of the foregoing individuals has been
convicted in a criminal proceeding and has not been a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction which
resulted in a judgment, decree, or final order enjoining further violations of,
or prohibiting activities, subject to, federal or state securities laws or
finding any violation of such laws.
Past Transactions and Agreements Between Biovail and Intelligent Polymers
The nature and approximate amount in dollars of any transaction which has
occurred since the commencement of Intelligent Polymers' second full fiscal year
preceding the date of the Statement between Biovail and Intelligent Polymers are
as follows:
(i) Since the commencement of Intelligent Polymers' second full fiscal
year preceding the date of the Statement, Intelligent Polymers paid
approximately $46.3 million to Biovail pursuant to a development and
license agreement (the "Development Contract") between Biovail and
Intelligent Polymers dated September 30, 1997 whereby Biovail has
agreed to use diligent efforts to conduct toxicity, formulation,
development and clinical studies for, and pursue U.S. regulatory
approval of, Intelligent Polymers' products, as defined and as added
to and modified by mutual agreement.
(ii) Since the commencement of Intelligent Polymers' second full fiscal
year preceding the date of the Statement, Intelligent Polymers paid
approximately $400,000 to Biovail pursuant to a services agreement
(the "Services Agreement") between Biovail and Intelligent Polymers
dated September 30, 1997, whereby Biovail has agreed to provide
management and administrative services to Intelligent Polymers for a
quarterly fee of $100,000.
(iii) Pursuant to the Development Contract and subject to the Biovail
Option (defined below), Biovail granted Intelligent Polymers a license
(the "License") to manufacture or obtain manufacturing for (subject to
an exclusive manufacturing period granted to Biovail, a right of first
refusal and a right of approval), sell and otherwise market and
sublicense other to market, through the world, (other than Canada),
products devel-
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oped under the Development Contract or, as to products for which
Intelligent Polymers and Biovail fail to reach agreement as to
necessary additional funding, under other arrangement.
(iv) In December 1999, Biovail paid Intelligent Polymers $25.0 million to
acquire a generic version of Procardia XL (the "Additional Product")
developed by Biovail on behalf of Intelligent Polymers. This
acquisition was pursuant to an exercise of the Biovail Option granted
under the Contract Agreement. The Biovail Option grants Biovail a
right to purchase the Additional Product for a price of either a one
time cash fee of $25 million or base royalties equal to 10% of the net
sales of such product.
Terms of Transaction
In order for Biovail to purchase the Common Shares pursuant to the Purchase
Option prior to October 1, 2000, it must exercise the Purchase Option by
delivering an exercise notice to the Board of Directors of Intelligent Polymers.
The terms of the Purchase Option are set forth in the Bye-Laws. Pursuant to the
Bye-Laws, if the Common Shares are acquired for cash pursuant to the Purchase
Option before October 1, 2000, the cash purchase price (the "Purchase Option
Consideration") would be $39.06 per share. The closing date of the purchase (the
"Closing Date") would be September 29, 2000, and the Purchase Option
Consideration would be deposited with ChaseMellon Shareholder Services LLC, as
payment agent (the "Payment Agent"), on or prior to the Closing Date. Promptly
following the Closing Date, and upon receipt of stock certificates for the
Common Shares, as instructed by the Payment Agent, the Payment Agent would
distribute the Purchase Option Consideration to each person or entity who was a
holder of the Common Shares at the close of business on the Closing Date.
The purpose of the Transaction would be to acquire the rights to all
products and product candidates developed or under development by Biovail and
Intelligent Polymers pursuant to the Development Contract dated September 30,
1997 between Biovail and Intelligent Polymers.
In accordance with the terms of the Bye-Laws, Shareholders would not need
to take any steps to approve the purchase upon Biovail's exercise of the
Purchase Option. Title to the Common Shares would automatically vest in Biovail
on the Closing Date and the Purchase Option Consideration would be paid to
Shareholders, upon tender of the stock certificates directly or through their
brokers, in accordance with their respective interests.
Subsequent to the purchase of the Common Shares, Intelligent Polymers would
become a wholly-owned subsidiary of Biovail. The Transaction would cause each
Shareholder to dispose of his or her Common Shares for the Purchase Option
Consideration.
Biovail expects it would follow purchasing accounting for the Transaction.
The terms of the Transaction would be the same for all Shareholders.
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Appraisal rights are not afforded under either applicable law or the
Bye-Laws to Shareholders in respect of the exercise of the Purchase Option and
none will be afforded by either Biovail or Intelligent Polymers. Biovail is not
aware of any rights available to objecting Shareholders under applicable law.
Biovail is unaware, after making reasonable inquiry of management of
Intelligent Polymers, of any grant of access to unaffiliated security holders to
the corporate files of either Biovail or Intelligent Polymers or the appointment
of counsel or appraisal services for unaffiliated security holders at the
expense of either Biovail or Intelligent Polymers.
Plans or Proposals
While Biovail has no committment or definitive plans, Biovail may explore
possibilities of restructuring the capitalization of, selling some of its equity
interest in, reorganizing or restructuring Intelligent Polymers.
Subsequent to the Closing Date, Intelligent Polymers would be wholly-owned
by Biovail. Biovail anticipates that Intelligent Polymers would be de-listed
from the AMEX and its reporting requirements with the Securities and Exchange
Commission would be suspended through the filing of a Form 15.
Source and Amounts of Funds
The total consideration that would be paid by Biovail for the purchase of
the Common Shares pursuant to the Transaction is, in the aggregate,
$145,986,750. The source of these funds would be Biovail's cash.
Biovail has no alternative financing arrangements or plans to those
discussed above.
The following table sets forth an estimate (except for the filing fee) of
expenses for the Transaction
Filing fee............................ $ 29,198
Accounting fees and expenses.......... 50,000
Legal fees and expenses............... 250,000
Printing expenses..................... 75,000
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Total............... $ 404,198
The expenses set forth in the table above will be paid by Biovail.
Interest in Securities of Intelligent Polymers
As of August 30, 2000, no Common Shares are beneficially owned by Biovail,
by any pension, profit sharing or similar plan of Biovail or, to Biovail's
knowledge after reasonable inquiry of management of Intelligent Polymers, by
Intelligent Polymers, by each executive officer and director of either Biovail,
Intelligent Polymers, any person controlling either Biovail or Intelligent
Polymers or
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any executive officer of any corporation ultimately in control of either Biovail
or Intelligent Polymers, or by any associate or majority owned subsidiary of
either Biovail or Intelligent Polymers except as set out on the following table:
Direct Indirect
Name Position Ownership Ownership
------------------------- ------------------------- --------- ---------
Eugene Melnyk Chairman of the Board and 17,500 20,000(1)
Director
Roger Rowan Director 16,500
Wilfred Bistrow Director - 10,000(1)
(1) owned by spouse
Financial Statement
Enclosed please find Intelligent Polymers' Annual Report on Form 20-F for
the year ended June 30, 1999 and Intelligent Polymers' Transition Report on Form
20-F for the period ended June 30, 1998. Financial statements for those periods
are contained therein.
Intelligent Polymers is not required to file quarterly reports.
Intelligent Polymers has no material fixed charges for the two most recent
fiscal years and the appropriate interim period.
Intelligent Polymers' book value per share as of June 30, 1999 was $6.31.
No pro forma disclosure has been provided because Intelligent Polymers
would terminate upon giving effect to the Transaction.
CONCLUSION
If you have any questions with respect to this transaction, please contact
Biovail Investor Relations at (416) 285-6000.
