GLYKO BIOMEDICAL LTD.
Scotia Plaza, Suite 2100
40 King Street West
Toronto, Ontario
M5H 3C2
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TAKE NOTICE THAT an Annual Meeting of Shareholders of GLYKO BIOMEDICAL LTD. will
be held at Suite 2100, Scotia Plaza, 40 King Street West, Toronto, Ontario, on
Thursday, the 26th day of June, 1997, at the hour of 8:30 o'clock in the morning
(Local Time), for the following purposes:
1. To receive the Consolidated Financial Statements of the
Corporation for the year ended December 31, 1996, together with the
Report of the Auditors thereon and the Annual Report of the Directors;
2. To elect Directors;
3. To appoint Auditors and authorize the Directors to fix their
remuneration;
4. To transact such other business as properly may be brought before the
Annual Meeting or any adjournment or adjournments thereof.
Shareholders who are unable to attend the Annual Meeting in person are requested
to sign and return to the Corporation the enclosed form of proxy.
The Corporation's Consolidated Financial Statements for the year ended December
31, 1996 and the Report of the Auditors thereon to the Shareholders and the
Annual Report of the Directors are enclosed herewith.
<PAGE>
The Board of Directors has fixed the close of business on May 16, 1997 as the
record date for the determination of Shareholders entitled to the Notice of
Annual Meeting and any adjournment or adjournments thereof.
DATED at Toronto this 7th day of May, 1997.
By order of the Board
/s/ John C. Klock, MD
John C. Klock, M.D.
President and
Chief Executive Officer
GLYKO BIOMEDICAL LTD.
1996 Annual Information Circular
May 7, 1997
<PAGE>
GLYKO BIOMEDICAL LTD.
Scotia Plaza, Suite 2100
40 King Street West
Toronto, Ontario
M5H 3C2
MANAGEMENT INFORMATION CIRCULAR
SOLICITATION OF PROXIES
This Management Information Circular is furnished in connection with the
solicitation of proxies by the Management of Glyko Biomedical Ltd. (the
"Corporation") for use at the Annual Meeting of Shareholders of the Corporation
(the "Meeting") to be held at the time and place and for the purposes set forth
in the attached Notice of Annual Meeting of Shareholders. It is anticipated that
the solicitation will be by mail primarily, but proxies may also be solicited
personally by regular employees of the Corporation. The cost of such
solicitation will be borne by the Corporation.
The form of proxy forwarded to Shareholders with the Notice of Annual Meeting
confers discretionary authority upon the proxy nominees with respect to various
matters identified in the Notice of Annual Meeting of Shareholders or other
matters which may properly come before the Meeting.
The form of proxy affords the Shareholder the opportunity to specify that the
shares registered in his name shall be voted or withheld from voting on and to
vote for or against any ballot that may be called for, in accordance with the
specifications made by Shareholders.
In respect of proxies in which the Shareholders have not specified that the
proxy nominees are required to vote, vote for, withhold from voting or vote
against, the shares represented by proxies in favour of management nominees will
be voted or voted for the applicable resolution.
<PAGE>
APPOINTMENT AND REVOCATION OF PROXIES
A Shareholder has the right to appoint a person (who need not be a Shareholder)
to attend and act for him and on his behalf at the Meeting other than the
persons designated in the enclosed form of proxy. Such right may be exercised by
striking out the names of the persons designated in the enclosed form of proxy
and by inserting in the blank space provided for that purpose the name of the
desired person or by completing another proper form of proxy and, in either
case, delivering the completed and executed proxy to the Corporation before the
time of the Meeting or any adjournment thereof.
A Shareholder who has given a proxy may revoke it at any time in so far as it
has not been exercised. A proxy may be revoked, as to any matter on which a vote
shall not already have been cast pursuant to the authority conferred by such
proxy, by instrument in writing executed by the Shareholder or by his attorney
authorized in writing or, if the Shareholder is a body corporate, under its
corporate seal or by an officer or attorney thereof duly authorized, and
deposited either at the registered office of the Corporation at any time up to
and including the last business day preceding the day of the Meeting, or any
adjournment thereof, at which the proxy is to be used or with the Chairman of
such Meeting on the day of the Meeting or any adjournment thereof, and upon
either of such deposits the proxy is revoked. A proxy may also be revoked in any
other manner permitted by law.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
On May 7, 1997, 21,523,044 Common Shares without par value of the Corporation
were issued and outstanding. Each Common Share entitles the holder thereof to
one vote at all meetings of Shareholders.
All Common Shareholders of record as of the time of the Meeting or any
adjournment thereof are entitled either to attend and vote thereat in person the
Common Shares held by them or, provided a completed and executed proxy shall
have been delivered to the Corporation, to attend and vote thereat by proxy the
Common Shares held by them.
<PAGE>
The following table lists certain information regarding beneficial ownership of
Glyko's Common Shares as of May 7, 1997, by (i) those persons who own more than
5% of the Corporation's common stock, (ii) each of the Corporation's "Named
Executive Officers" (as defined below), (iii) each of the Corporation's
directors, and (iv) by the Corporation's officers and directors as a group. The
statements as to the shares of the Corporation beneficially owned or over which
control or direction is exercised by the nominees for election as Directors
hereinafter named are in each instance based upon information furnished by the
person concerned.
<TABLE>
============================== ------------------------------ -------------------------- =======================
<CAPTION>
Name and Address of Number of Shares Held Percent of Class
Title of Class Beneficial Owner
============================== ------------------------------ -------------------------- =======================
<S> <C> <C> <C>
Gwynn R. Williams
c/o Astroscan Ltd.
Ballabeg House
Cronkbourne Village
Bradden, Isle of Man
Common Shares British Isles, UK 3,017,476 (1) 12.9
============================== ------------------------------ -------------------------- =======================
Millipore Corporation
80 Ashby Road
Common Shares Bedford, MA 01730 2,461,177 10.5
============================== ------------------------------ -------------------------- =======================
New York Life Insurance
Company
51 Madison Avenue
Common Shares New York, NY 10010 2,436,250 10.4
============================== ------------------------------ -------------------------- =======================
Trianon Opus One Inc.
Julius Baer Securities Inc.
330 Madison Avenue
Common Shares New York, NY 10017 1,764,000 7.5
============================== ------------------------------ -------------------------- =======================
Glycomed Corporation
860 Atlantic Avenue
Common Shares Alameda, CA 94501 1,326,654 5.7
============================== ------------------------------ -------------------------- =======================
John C. Klock
c/o Glyko, Inc.
11 Pimentel Court
Common Shares Novato, CA 94949 1,164,013 (2) 5.0
============================== ============================== ========================== =======================
Luzerner Kantonbank
Pilatusstrasse 12
CH-6002 Lazern
Common Shares Switzerland 1,100,000 4.7
============================== ============================== ========================== =======================
</TABLE>
<PAGE>
<TABLE>
- ------------------------------ ------------------------------ -------------------------- =======================
<CAPTION>
Name and Address of Number of Shares Held Percent of Class
Title of Class Beneficial Owner
- ------------------------------ ------------------------------ -------------------------- =======================
<S> <C> <C> <C>
Christopher M. Starr
c/o Glyko, Inc.
11 Pimentel Court
Common Shares Novato, CA 94949 245,372 (3) 1.0
- ------------------------------ ------------------------------ -------------------------- =======================
John H. Craig
c/o Cassels Brock &
Blackwell, Scotia Plaza,
Suite 2100, 40 King Street
West, Toronto M5H 3C2
Common Shares Canada 71,567 (1) *
============================== ------------------------------ -------------------------- =======================
R. William Anderson
c/o Fidus Medical Tech.
47929 Fremont Blvd.
Common Shares Fremont, CA 94538 70,566 (1) *
============================== ------------------------------ -------------------------- =======================
John S. Glass
Milkhaus Laboratory, Inc.
48 Main Street
Common Shares Boxford, MA 01921 68,000 (4) *
- ------------------------------ ------------------------------ -------------------------- =======================
Mark I. Young
c/o Cassels Brock &
Blackwell, Scotia Plaza,
Suite 2100, 40 King Street
West, Toronto M5H 3C2
Common Shares Canada 1,300 *
- ------------------------------ ------------------------------ -------------------------- =======================
Common Shares All Officers and Directors 4,638,294 (5) 19.8
============================== ============================== ========================== =======================
<FN>
* Less than 1%
(1) Includes 70,566 Common Shares issuable upon exercise of options
within 60 days of May 7, 1997.
(2) Includes 540,968 Common Shares issuable upon exercise
of options within 60 days of May 7, 1997.
(3) Includes 237,600 Common Shares issuable upon exercise of options
within 60 days of May 7, 1997.
(4) Includes 68,000 Common Shares issuable upon exercise
of options within 60 days of May 7, 1997.
(5) Includes 1,056,266 Common Shares
issuable upon exercise of options within 60 days of May 7, 1997.
(Excludes shares held by Millipore and Glycomed.)
</FN>
</TABLE>
<PAGE>
ELECTION OF DIRECTORS
The articles of the Corporation provide that there shall be cumulative voting
for the election of directors. Therefore, each shareholder of the Corporation
entitled to vote for the election of directors has the right to cast a number of
votes equal to the number of votes attached to all the shares held by him
multiplied by the number of directors to be elected. A shareholder may cast all
such votes in favour of one candidate or distribute them among the candidates in
such manner as he sees fit.
For example, if a shareholder holds 100 Common Shares and desires to vote them
for the election of directors, the shareholder would be entitled to cast 600
votes, a number arrived at by multiplying the total number of Common Shares held
by the shareholder by the number (6) of directors to be elected. The 600 votes
resulting from such multiplication would be cast in favour of one candidate or
distributed among any number of candidates in any portion desired.
If a shareholder votes for more than one candidate without specifying the
distribution of his votes among the candidates, he will be deemed to have
distributed his votes equally among the candidates for whom he voted. If the
number of candidates nominated for director exceeds the number of positions to
be filled, the candidates who receive the least number of votes shall be
eliminated until the number of candidates remaining equal the number of
positions to be filled. A separate vote of shareholders shall be taken with
respect to each candidate nominated for director unless a resolution is passed
unanimously permitting two or more persons to be elected by a single resolution.
The present term of office of each director of the Corporation will expire
immediately prior to the election of directors at the Annual Meeting of
Shareholders. Each of the persons whose name appears hereunder is proposed to be
elected as a director of the Corporation to serve until the next Annual Meeting
of Shareholders or until his successor is elected or appointed. It is intended
that on any ballot that may be called for relating to the election of directors
the shares represented by the proxies in favour of Management nominees will be
voted in favour of the election of the persons whose names are set out below,
with such votes being equally distributed among such persons as directors of the
Corporation. Unless a shareholder has specified in his proxy that his shares are
to be withheld from voting in the event that any vacancies occur in the slate of
Management nominees, it is intended that discretionary authority shall be
exercised to vote the share represented by such proxies for the election of such
other person or persons as directors in accordance with the best judgment of
Management proxy nominees.
Management does not contemplate that any of the nominees will be unable to serve
as a Director but if that should occur for any reason prior to the Meeting it is
intended that discretionary authority shall be exercised by the persons named in
the enclosed form of proxy to vote the proxy for the election of any other
person or persons in place of any nominee or nominees unable to serve.
<PAGE>
The names of all of the members of the Board of Directors, their principal
occupation or employment during the last 5 years and the dates on which they
became Directors are as follows:
<TABLE>
=========================================================== =================================
<CAPTION>
Name and Present Principal Occupation Date First Appointed Director
=========================================================== =================================
<S> <C>
R. William Anderson *
Chief Financial Officer
Fidus Medical Technology Corporation June 26, 1992
=========================================================== =================================
John H. Craig
Partner
Cassels Brock and Blackwell June 26, 1992
=========================================================== =================================
John S. Glass
Vice President and Chief Financial Officer
Milkhaus Laboratory, Inc. August 3, 1994
=========================================================== =================================
John C. Klock *
President and Chief Executive Officer
Glyko Biomedical Ltd. June 26, 1992
- ----------------------------------------------------------- =================================
Gwynn R. Williams *
Physicist June 26, 1992
- ----------------------------------------------------------- =================================
Mark I. Young
Partner
Cassels Brock and Blackwell March 14, 1997
=========================================================== =================================
<FN>
* - member of the Audit Committee
</FN>
</TABLE>
All Directors have held the above positions throughout the past five years,
except that: prior to August, 1994 Mr. Anderson was Vice-President and Chief
Financial Officer of Glycomed Incorporated; prior to August 1994 Mr. Craig was a
partner of the firm Holden Day Wilson, Barristers and Solicitors; prior to June
1994 Mr. Glass was Director of Investor Relations and Vice President of
Millicorp, a venture capital subsidiary of Millipore Corporation; and prior to
August, 1994, Mr. Young was a partner of the firm Holden Day Wilson, Barristers
and Solicitors.
All Directors hold office until the next Annual Meeting of Shareholders or until
their successors are elected and qualified. Officers are appointed by the Board
of Directors and serve at the discretion of the Board. There are no family
relationships among the officers and directors of the Corporation.
<PAGE>
Mr. R. William Anderson has served as a Director since 1992 and is the Chief
Financial Officer of Fidus Medical Technology Corporation and was
previously an independent consultant. From 1989 to 1994 he served as
Vice-President, Finance and Chief Financial Officer of Glycomed
Incorporated. From July 1985 to April 1989, he served as Vice-President of
Finance and Administration and Chief Financial Officer for Chiron
Corporation, a biotechnology company. Prior to Chiron, Mr. Anderson was
Controller and Director of Financial Planning and Analysis at Syntex
Laboratories, Inc., the domestic pharmaceutical subsidiary of Syntex
Corporation. Mr. Anderson holds an M.B.A. from the Harvard Business School.
Mr. John H. Craig has served as a Director and Secretary of the Corporation
since 1992 and has been a solicitor and partner with Cassels Brock and
Blackwell and previously with Holden Day Wilson, Toronto law firms, since
1973. Mr. Craig is a director of a number of public companies listed on the
Toronto Stock Exchange.
Mr. John S. Glass has served as a Director since August 1994 and is Vice
President and Chief Financial Officer of Milkhaus Laboratory, Inc., a
clinical stage biopharmaceutical company. From 1968 to 1994 he served in
various capacities at Millipore Corporation, most recently as Director of
Investor Relations and Vice President of Millicorp, a venture capital
subsidiary. Previously Mr. Glass was a research and development manager at
Polaroid Corporation. Mr. Glass holds a Masters degree in management from the
Massachusetts Institute of Technology.
Dr. John C. Klock was formerly an academic physician and carbohydrate researcher
at the University of California at San Francisco (1976-1981), Scientific
Director of the Institute of Cancer Research of California Pacific Medical
Center in San Francisco (1982-1986), a research director at Murex Corporation, a
diagnostic pharmaceutical company (1985-1986) and the scientific founder of
Glycomed Incorporated, a therapeutical company based on complex carbohydrate
technology (1986-1990).
Mr. Gwynn R. Williams is a founder of Glyko (established 1990). He is also
founder and owner of Astromed and Astroscan, U.K. manufacturers of scientific
equipment established in 1984. Mr. Williams was a partner in Arthur Andersen
& Co. (1971-1982). Previously, he was a mathematician with General
Motors Research in Detroit (1961-1970) and with British Steel (1958-1960).
Mr. Mark I. Young has served a Director of the Corporation since March, 1997
and has been the Assistant Secretary of the Corporation since 1992.
Mr. Young is a solicitor and partner with Cassels Brock and Blackwell practicing
in the areas of corporate commercial and securities law. Mr. Young is an
officer or director of a number of public companies listed on The Toronto Stock
Exchange.
<PAGE>
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Corporation's
officers and directors, and persons who own ten percent or more of a registered
class of the Corporation's equity securities, to file with the Securities
Exchange Commission (the "SEC") initial reports of ownership and reports of
changes in ownership of Common Stock and other equity securities of the
Corporation. Officers, directors and ten percent or more stockholders are
required by SEC regulations to furnish the Corporation with copies of all
Section 16(a) forms they file.
To the Corporation's knowledge, based solely on review of the copies of such
reports furnished to the Corporation or written representations that no other
reports were required, during the fiscal year ended December 31, 1996, all
officers, directors, and ten percent stockholders complied with all Section
16(a) filing requirements, except that the Forms 5 for all officers, directors
and ten percent stockholders were filed late.
Board Meetings and Committees
The Board of Directors of the Corporation held a total of three meetings during
the year ended December 31, 1996. No director participated in fewer than 75
percent of all such meetings and actions of the Board of Directors and the
committees, if any, upon which such director served.
The Board of Directors has an Audit committee. It does not have a Nominating
Committee or a committee performing the functions of a Nominating Committee.
The Audit Committee of the Board of Directors consists of Messrs. Anderson,
Klock and Williams. The Audit Committee recommends engagement of the
Corporation's independent accountants, and is primarily responsible for
reviewing and approving the scope of the audit and other services performed by
the Corporation's independent accountants and for reviewing and evaluating the
Corporation's accounting principles and its systems of internal accounting
controls.
The Audit Committee has reviewed the Corporation's 1996 financial statements and
has recommended that the Board of Directors approve those financial statements.
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table contains information about the compensation paid to, or
earned by, those who were, at December 31, 1996, the Corporation's President,
Chief Executive Officer and Chief Financial Officer and Vice-President, Research
and Development, being the only executive officers of the Corporation
(collectively, the "Named Executive Officers"). Specific aspects of their
compensation are dealt with in further detail in subsequent tables.
<TABLE>
========================== ------- ========================================== ------------------ ===================
<CAPTION>
All Other
Name and Principal Long-term Compensation
Position Year Annual Compensation Compensation (U.S.$)
========================== ------- ========================================== ------------------ ===================
Securities Under
Other Annual Options Granted
Salary Bonus Compensation (#)
(U.S.$) (U.S.$) (U.S.$)
========================== ------- ------------ ---------- ------------------ ------------------ ===================
<S> <C> <C> <C> <C> <C> <C>
John C. Klock
President ,Chief
Executive Officer 1996 187,297 -- -- -- --
------- ------------ ---------- ------------------ ------------------ ===================
and Chief Financial 1995 192,500 -- -- 128,218 --
------- ------------ ---------- ------------------ ------------------ ===================
Officer 1994 184,200 -- -- 482,330 --
========================== ------- ------------ ---------- ------------------ ------------------ ===================
Christopher M. Starr
Vice-President, Research
and Development
1996 126,528 -- -- -- --
------- ------------ ---------- ------------------ ------------------ ===================
1995 130,000 -- -- 80,249 --
------- ------------ ---------- ------------------ ------------------ ===================
1994 118,800 -- -- 7,660 --
========================== ======= ============ ========== ================== ================== ===================
</TABLE>
Long-term Compensation Plans
Option Grants in 1996
Pursuant to the Corporation's stock option plan (the "Plan"), the Board
of Directors may from time to time authorize the granting to directors,
officers, employees and consultants of the Corporation of options to purchase up
to 3,000,000 common shares. Granting of options in excess of the 3,000,000 share
maximum is subject to shareholder approval. Certain options granted in 1994 and
1995 are subject to regulatory approval by the Toronto Stock Exchange. The
exercise price of any option shall be fixed by the Board of Directors provided
that such price may not be less than the market price of the shares at the time
the option is granted and payment of such exercise price must be made in full at
the time of exercise.
Options under the Plan may be granted for any term up to ten years, are
non-assignable, and are subject to earlier termination upon the termination of
an optionee's employment for any cause including retirement, permanent
disability but not death. In the event of death of an optionee, his estate may
be entitled for a period of six months thereafter to exercise any option which a
deceased optionee would have been entitled to exercise if then alive but in any
event not after the date of expiration of the option. No individual may hold
options to purchase more than 5% of the number of common shares outstanding from
time to time.
The purpose of the Plan is to attract and motivate the directors,
officers, employees and consultants of the Corporation and to advance the
Corporation by affording such persons the opportunity to acquire an equity
interest in the Corporation. In determining whether options will be granted, the
Board of Directors will review the financial position of the Corporation, the
performance of such individuals in carrying out their duties and their
willingness to serve the needs of the Corporation in general and the general
state of the financial markets.
There were no stock options granted to the Named Executive Officers and the
directors of the Corporation in 1996 under the terms of the Plan.
<PAGE>
Options Exercised and Options Remaining
The following table provides detailed information regarding options exercised by
the Named Executive Officers and directors of the Corporation during 1996. In
addition, details on remaining options held are provided.
<TABLE>
========================= ------------- ------------- ==================================== ====================================
<CAPTION>
Value of Unexercised
Unexercised Options at in-the-money Options at
December 31, 1996 December 31, 1996(1)
- ------------------------- ------------- ------------- ------------------------------------ ------------------------------------
<CAPTION>
Securities
Acquired Aggregate
on Exercise Value
(#) Realized Exercisable Unexercisable Exercisable Unexercisable
Name (C$) (#) (#) (C$) (C$)
========================= ------------- ------------- ---------------- ------------------- ----------------- ==================
<S> <C> <C> <C> <C> <C> <C>
R. William Anderson -- -- 70,127 1,393 -- --
========================= ------------- ------------- ---------------- ------------------- ----------------- ==================
John H. Craig -- -- 70,127 1,393 -- --
========================= ------------- ------------- ---------------- ------------------- ----------------- ==================
John S. Glass -- -- 68,000 -- -- --
========================= ------------- ------------- ---------------- ------------------- ----------------- ==================
John C. Klock -- -- 481,949 128,599 -- --
========================= ------------- ------------- ---------------- ------------------- ----------------- ==================
Christopher M. Starr -- -- 237,458 451 -- --
========================= ------------- ------------- ---------------- ------------------- ----------------- ==================
Gwynn R. Williams -- -- 70,127 1,393 -- --
========================= ------------- ------------- ---------------- ------------------- ----------------- ==================
Mark I. Young -- -- -- -- -- --
========================= ------------- ------------- ---------------- ------------------- ----------------- ==================
<FN>
(1) Based on the closing price of common shares on The Toronto Stock
Exchange on December 31, 1996 of $0.40.
</FN>
</TABLE>
COMPENSATION OF DIRECTORS
The Directors of the Corporation received no compensation for services rendered
in their capacity as directors.
<PAGE>
INTEREST OF INSIDERS IN MATERIAL TRANSACTIONS
To the best of Management's knowledge none of the Directors or senior officers
of the Corporation or any of their associates or affiliates had any direct or
indirect interest in any material transactions of the Corporation entered into
during the past twelve months, save and except that:
(i) Purchases and Leasing - The Corporation has purchased
supplies and equipment and has rented facilities from certain of its
shareholders. During the year ended December 31, 1996, the total cost of
such transactions was U.S. $274,284.
(ii) Employment Agreement - The Corporation's wholly-owned subsidiary, Glyko,
Inc., first entered into an employment agreement (the "Employment Agreement")
with Dr. John C. Klock, M.D. ("Klock") on December 20, 1990. The Board of
Directors has renewed the Employment Agreement for an additional two years
effective January 1, 1996 retaining Klock as the Corporation's president. Under
the Employment Agreement, the Corporation's Board of Directors annually reviews
Klock's salary and makes adjustments which the Board of Directors in its
discretion deems to be appropriate. Glyko, Inc. is obligated to continue paying
Klock's compensation for a period of six months following Klock's mental or
physical incapacity or his death. The Employment Agreement may be renewed for
subsequent periods, subject to agreement by the parties on Klock's compensation
for the renewal terms. The Employment Agreement may be terminated by Klock upon
three months' notice and by Glyko, Inc. upon six months' notice or immediately
upon a breach of Klock's duties required under the Employment Agreement. By its
terms, the Employment Agreement does not terminate upon a merger, consolidation
or sale of substantially all of Glyko, Inc.'s assets and the obligations under
the Employment Agreement shall be delegated to the successor entity in such
situation.
INDEBTEDNESS OF DIRECTORS AND SENIOR OFFICERS
During fiscal 1996, other than routine indebtedness, no loans were made by the
Corporation to any senior officer or Director or any key employee of the
Corporation or any of their other respective associates.
<PAGE>
CORPORATE GOVERNANCE
Mandate of the Board
The mandate of the Corporation's board of directors is to provide guidance to
the Corporation's management in the following areas:
long term strategic planning
risk analysis and monitoring of risk management systems
overseeing the appointment and training of senior management
and monitoring their performance, including succession planning
establishing and monitoring the Corporation's communications
policy and ensuring that it addresses the feedback and concerns of
shareholders in particular
ensuring the integrity of the Corporation's systems for internal
controls and management information
developing and implementing the Corporation's corporate
governance guidelines
approval of the annual operating and capital budgets
Composition of the Board
The Corporation's Board consists of six directors. Five members of the board are
outside directors who are not members of management. A majority of the Board can
be considered "unrelated" directors in that they do not have any interest or
business or other relationship which could or could reasonably be perceived to
materially interfere with their ability to act with a view to the best interests
of the Corporation.
The Corporation does not have a significant shareholder who is able to elect a
majority of the Corporation's Board.
Committees
The Board presently has an Audit Committee and a Compensation and Retirement
Plan Committee which have been assigned the specific responsibilities described
below. However, due the size of the Corporation and its board, the functions of
a Nominating or Executive Committee are performed by the entire Board.
<PAGE>
Audit Committee
The Audit Committee consists of three directors, a majority of whom are outside
directors. It carries our the following responsibilities:
reviewing the Corporation's audited financial statements
meeting with the Corporation's management and auditors for that purpose
Compensation and Retirement Plan Committee
The Compensation and Retirement Plan Committee consists of two directors, both
of whom are outside directors. It carries our the following responsibilities:
review compensation structure for appropriateness and competitiveness
recommend officer salaries to the Board of Directors
recommend officer and staff bonuses to the Board of Directors
reviews retirement plan investments for adequate performance
APPOINTMENT OF AUDITORS
Unless authority to do so is withheld, the persons named in the enclosed form of
proxy intend to vote for the appointment of the firm of Arthur Anderson LLP, as
auditors of the Corporation, to hold office until the next Annual Meeting of
Shareholders at a remuneration to be fixed by the Directors.
GENERAL
The Directors will lay before the Meeting their Annual Report and the
Consolidated Financial Statements of the Corporation for the years ended
December 31, 1996 and 1995 and the Report of the Auditors to the Shareholders
will be presented. Receipt at the Meeting of the Annual Report of the Directors
and the Corporation's Financial Statements for its last completed fiscal year,
together with the Report of the Auditors, will not constitute approval or
disapproval by the Shareholders of any matters referred to therein.
Except as otherwise indicated, information contained herein is given as of May
7, 1996. Management knows of no matters to come before the Meeting other than
the matters referred to in the Notice of Annual Meeting of Shareholders.
However, if any other matters which are not now known to Management should come
properly before the Meeting, the proxy will be voted on such matters in
accordance with the best judgment of the person voting it.
<PAGE>
APPROVAL
The contents of this Management Information Circular and the sending thereof to
the Shareholders have been authorized by the Board of Directors of the
Corporation.
DATED at Toronto this 7th day of May, 1997
\s\ John C. Klock, MD
John C. Klock, M.D.
President and
Chief Executive Officer
GLYKO BIOMEDICAL LTD.
Scotia Plaza, Suite 2100
40 King Street West
Toronto, Ontario M5H 3C2
Canada
FORM OF PROXY SOLICITED BY THE MANAGEMENT FOR USE AT THE
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
JUNE 26, 1997
The undersigned Shareholder(s) of GLYKO BIOMEDICAL LTD. hereby appoint(s) John
C. Klock, President and Chief Executive Officer, or failing him John H. Craig,
Secretary, or failing him, Mark I. Young, Assistant-Secretary, or in lieu of the
foregoing as nominee of the undersigned to attend, act and vote for the
undersigned at the Annual Meeting of the Shareholders of the Corporation to be
held on the 26th day of June, 1997, and at any adjournment or adjournments
thereof to the same extent and with the same power as if the undersigned was
present at the Annual Meeting or adjournment or adjournments thereof and,
without limiting the generality of the power hereby conferred, the nominees
designated above are directed to:
(a) VOTE ( ) WITHHOLD FROM VOTING ( ) in respect of the election of
Directors;
(b) VOTE ( ) WITHHOLD FROM VOTING ( ) in respect of the appointment of
Auditors and authorizing the
Directors to fix their
remuneration;
(c) VOTE ( ) WITHHOLD FROM VOTING ( ) on such other matters as may come
properly before the Annual
Meeting:
hereby revoking any proxy previously given.
If any amendments or variations to matters identified in the Notice of Annual
Meeting are proposed at the Annual Meeting or any adjournment or adjournments
thereof or if any other matters properly come before the Annual Meeting or any
adjournment or adjournments thereof, this proxy confers discretionary authority
to vote on such amendments or variations or such other matters according to the
best judgment of the person voting the proxy at the Annual Meeting or any
adjournment or adjournments thereof.
This proxy is solicited by the Management of the Corporation. A Shareholder has
the right to appoint a person to represent him and to attend and act for him on
his behalf at the Annual Meeting or any adjournment or adjournments thereof
other than the nominees designated above and may exercise such right by striking
out the names of the persons designated above and inserting the name of his
nominee in the blank space provided above for that purpose.
<PAGE>
DATED the day of , 1997.
Signature of Shareholder(s)
Name(s) of Shareholder(s)
(Please Print)
Number of Shares Represented
by this Proxy
Notes:
1. This form of proxy must be dated and signed by the Shareholder or his
attorney authorized in writing or, if the Shareholder is a body corporate, this
form of proxy must be executed under its corporate seal or by an officer or
attorney thereof duly authorized.
2. The shares represented by this proxy will be voted, voted for, withheld from
voting or voted against in accordance with the instructions of the Shareholder
on any ballot that may be called for. Where no specification is made to vote or
withhold from voting in respect of the election of Directors or the appointment
of Auditors, the nominees are directed to vote the shares represented by this
proxy
3. This proxy ceases to be valid one year from its date.
4. Please date the proxy. If not dated, the proxy shall be deemed to be dated on
the day on which it is mailed.
5. If your address as shown is incorrect, please give your correct address when
returning this proxy.
Return all forms of proxy to:
Montreal Trust Company of Canada
151 Front Street West, 8th Floor
Toronto, Ontario M5J 2N1
Canada
GLYKO BIOMEDICAL LTD.
11 PIMENTEL COURT
NOVATO, CA 94949
U.S.A.
GLYKO BIOMEDICAL LTD. CUSIP # 379904105
In accordance with National Policy Statement No. 41/Shareholder Communication,
beneficial shareholders may elect annually to have their name added to an
issuers supplemental mailing list in order to receive financial statements. If
you are interested in receiving such statements, please complete and return this
form to Glyko Biomedical Ltd., attention: Investor Relations.
NAME:
-------------------------------------------------
ADDRESS:
-------------------------------------------------
-------------------------------------------------
SIGNATURE:
-------------------------------------------------
I certify that I am a beneficial shareholder
Glyko Biomedical Ltd.
First Quarter Report
March 31, 1997
<PAGE>
To our stockholders:
In the first quarter of 1997, Glyko Biomedical Ltd. (the Company) successfully
raised Cdn.$2.0 million to fund the start-up of BioMarin Pharmaceutical, Inc.
which was formed to develop the Company's pharmaceutical products. The Company
also received a one-time distribution fee in February, 1997, which will expand
our marketing efforts to Asia.
Revenues for the first quarter of 1997 were $491,000. Product sales were lower
this first quarter of 1997 as compared to the same quarter last year primarily
due to the relocation of the Company's California facilities which delayed
fulfilling orders. Other revenues were higher in the first quarter of 1997
compared to the same quarter last year due to a one-time distribution fee earned
in February, 1997.
Looking further into the future, we seek to fund the operations of the Company
and maximize the value of the Company to the stockholders. We are considering
many options to provide growth for the Company including increasing revenues
both in analytical product sales and pharmaceutical product sales, the
licensing or sale of technology developed by the Company and the creation of
companies or partnerships to better exploit opportunities within our technical
grasp.
Our primary research focus within Glyko, Inc. remains upon diagnostic
applications of FACE in the areas of lysosomal storage diseases, measurement of
heparin levels, osteoporosis markers, and alcohol consumption tests. We are
planning additional FDA submissions for diagnostic products and we continue to
seek diagnostic marketing partners.
BioMarin Pharmaceutical, Inc. was formed by the Company in October, 1996 to
exploit the Company's carbohydrate-active enzymes as therapeutic agents for a
variety of clinical targets. BioMarin's first five disease targets include
lysosomal storage diseases, enzymatic debridement of burns and chronic wounds,
anti-fungal agents, pro-fertility products and anti-inflammatory agents.
BioMarin's Chairman and CEO is Grant W. Denison, Jr., formerly an executive at
Pfizer, Squibb and Searle, most recently Corporate Vice President for Planning
at Monsanto and President of U.S. Operations for Searle.
The Company is exploiting both the natural functions of these enzymes as
pharmaceuticals and its expertise in recombinant carbohydrate enzyme technology.
In addition, BioMarin has been able to establish collaborations with top medical
institutions to rapidly begin clinical and pre-clinical animal testing of its
lead compounds. These factors will enable BioMarin to be in patient trials this
year.
Proceeds of the first quarter 1997 offering to start BioMarin will be used to
fund these pre-clinical animal and human clinical trials for the first
pharmaceutical compounds. With this new venture, the Company will be able to
combine a technical expertise and knowledge of the role of complex carbohydrates
in disease with advanced carbohydrate biotechnology to affect patient outcomes.
/s/ John C. Klock, MD
John C. Klock, M.D.
President and Chief Executive Officer
May 7, 1997
<PAGE>
GLYKO BIOMEDICAL LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in U.S. dollars)
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
----------------- -----------------
<S> <C> <C>
Assets
Cash $ 708,455 $ 210,992
Other current assets 251,075 250,653
Non-current assets 159,317 110,245
----------------- -----------------
Total assets $ 1,118,847 $ 571,890
================= =================
Liabilities and Stockholders' Equity (Deficit)
Total current liabilities $ 748,886 $ 868,765
Non-current liabilities - -
----------------- -----------------
Total liabilities 748,886 868,765
Stockholders' equity (deficit)
Common stock, no par value,
unlimited shares authorized,
21,523,044 shares issued and
outstanding
(17,243,044 in 1996) 13,131,250 12,203,065
Common stock warrants 929,585 433,897
Accumulated deficit (13,690,874) (12,933,837)
----------------- -----------------
Total stockholders'
equity (deficit) 369,961 (296,875)
----------------- -----------------
Total liabilities and
stockholders' equity
(deficit) $ 1,118,847 $ 571,890
================= =================
</TABLE>
<PAGE>
GLYKO BIOMEDICAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in U.S. dollars)
Three months ended
<TABLE>
<CAPTION>
March 31,
------------------------------
1997 1996
-------------- --------------
<S> <C> <C>
Sales of products and services $ 241,154 $ 404,951
Other revenues 250,020 38,090
-------------- --------------
Net revenues 491,174 443,041
Expenses:
Cost of products and services 98,151 146,630
Research and development 844,770 277,421
Selling, general and
administrative 314,455 375,242
-------------- --------------
1,257,376 799,293
-------------- --------------
Loss from operations (766,202) (356,252)
Interest income 1,923 3,645
Other income/(expense) 7,254 3,788
-------------- --------------
Net loss $ (757,025) $ (348,819)
============== ==============
Loss per common share $ (0.04) $ (0.02)
============== ==============
Weighted average number of
shares used in computing
per share amounts 17,480,822 14,567,944
============== ==============
</TABLE>
<PAGE>
GLYKO BIOMEDICAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in U.S. dollars)
<TABLE>
<CAPTION>
Three months ended
March 31,
--------------------------------------
1997 1996
----------------- -----------------
<S> <C> <C>
Net loss $ (757,025) $ (348,819)
Adjustments to reconcile net loss
to net cash used in operating
activities (103,412) 23,000
----------------- -----------------
Net cash used in operating activities (860,437) (325,819)
Net cash used in investing activities (62,493) (2,708)
Net cash provided by financing activities 1,420,393 (5,112)
----------------- -----------------
Net increase (decrease) in cash 497,463 (333,639)
Cash and cash equivalents,
beginning of period 210,992 620,720
----------------- -----------------
Cash and cash equivalents,
end of period $ 708,455 $ 287,081
================= =================
</TABLE>
<PAGE>
Note to Condensed Consolidated Financial Statements
- -------------------------------------------------------------------
1 Basis of Presentation
The accompanying condensed consolidated financial statements and related
footnote have been prepared in conformity with Canadian generally accepted
accounting principles using U.S. dollars. The information at March 31, 1997
and 1996, and for the three month periods then ended, is unaudited, but
includes all adjustments (consisting only of normal recurring entries) which
the Company's management believes to be necessary for the fair presentation
of the financial position and the results of operations for the periods
presented. Interim results are not necessarily indicative of results for a
full year. The accompanying financial statements should be read in
conjunction with the Company's audited financial statements for the year
ended December 31, 1996.
<PAGE>
Stockholder Information
Transfer Agent:
If you have questions about your stock certificates, of if you need to change
your stock registration, please write to:
Montreal Trust Company of Canada
151 Front Street West, 8th Floor
Toronto, Canada M5J-2N1
Attention: Shareholder Services
Additional Information:
If you would like to receive a copy of the Company's 1996 Annual Report, be
added to our mailing list or receive other information please direct your
request to:
Glyko Biomedical Ltd.
11 Pimentel Court
Novato, California 94949
tel: (415) 382-3500
fax: (415) 382-7889
e-mail: [email protected]
website: http://www.glyko.com
Stock Listings:
Glyko Biomedical Ltd. common stock is traded on The Toronto Stock Exchange under
the TSE symbol GBL, on the BVD - Berlin:GLY and is quoted on the National
Association of Securities Dealers (NASD) OTC Bulletin Board under the symbol
GLYK.
