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, M5H
3C2 on Thursday, the 24th day of June, 1999 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, 1998, 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, 1998 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 14, 1999 as the
record date for the determination of Shareholders entitled to the Notice of
Annual Meeting and any adjournment or adjournments thereof.
The Board of Directors has fixed 48 hours before the time of the Meeting
(excluding Saturdays, Sundays and holidays) and any adjournments thereof as the
time before which proxies to be used as acted upon at the Meeting or any
adjournments thereof shall be deposited with the Corporation or its transfer
agent.
DATED at Toronto this 7th day of May, 1999.
By order of the Board
/s/John C. Klock, M.D.
John C. Klock, M.D.
President, Chief Executive Officer
and Chief Financial Officer
GLYKO BIOMEDICAL LTD.
Management Information Circular
May 7, 1999
<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 of
Shareholders 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 for or withhold from voting, the shares
represented by such proxies will be voted for the applicable resolutions.
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 registered office of
the Corporation or the Corporation's transfer agent not less than 48 hours
(exclusive of Saturdays, Sundays and holidays) before the time of the Meeting or
with the Chairman of the Meeting 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,
<PAGE>
-2-
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, 1999, 31,489,605 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 holders of Common Shares 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.
The following table lists certain information regarding beneficial ownership of
the Corporation's Common Shares as of May 7, 1999, 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 Corporation's directors are in each
instance based upon information furnished by the person concerned.
<PAGE>
-3-
<TABLE>
<CAPTION>
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Title of Class Name and Address of Beneficial Owner Number of Shares Held Percent of Class
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
<S> <C> <C> <C>
Common Shares New York Life Insurance Company 4,185,000(1) 12.8%
51 Madison Avenue
New York, NY 10010
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares LaMont Asset Management 3,816,369 12.1%
Baarerstrasse 10
P.O. box 4639
6304 Zug, Switzerland
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares Gwynn R. Williams 3,485,188(2) 10.9%
c/o Life Science Resources Ltd.
3rd Floor Salisbury House
15 Victoria Street
Douglas, Isle of Man
British Isles, UK
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares Trianon Opus One Inc. 1,764,000 5.6%
Julius Baer Securities Inc.
330 Madison Avenue
New York, NY 10017
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares John C. Klock 627,817(3) 2.0%
c/o BioMarin Pharmaceutical Inc.
371 Bel Marin Keys Blvd. , Suite 210
Novato, CA 94949
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares Christopher M. Starr 8,072(4) *
c/o BioMarin Pharmaceutical Inc.
371 Bel Marin Keys Blvd. , Suite 210
Novato, CA 94949
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares John H. Craig 68,521(5) *
c/o Cassels Brock & Blackwell, Scotia
Plaza, Suite 2100,
40 King Street West
Toronto, ON M5H 3C2
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares R. William Anderson 82,520(6) *
c/o BioMarin Pharmaceutical Inc.
371 Bel Marin Keys Blvd. , Suite 210
Novato, CA 94949
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
<PAGE>
-4-
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Title of Class Name and Address of Beneficial Owner Number of Shares Held Percent of Class
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares John S. Glass 109,000(7) *
Milkhaus Laboratory, Inc.
48 Main Street
Boxford, MA 01921
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares Mark I. Young 42,000(8) *
c/o Cassels Brock & Blackwell, Scotia
Plaza, Suite 2100, 40 King Street West,
Toronto, ON M5H 3C2
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
Common Shares All Officers and Directors 4,423,118(9) 13.8%
- ------------------------------ ----------------------------------------- ---------------------- ----------------------
<FN>
* Less than 1%
(1) Includes 1,311,562 Common Shares issuable upon exercise of common share purchase warrants.
(2) Includes 92,520 Common Shares issuable upon exercise of options within 60 days of May 7, 1999 and
312,568 Common Shares issuable upon exercise of common share purchase warrants.
(3) Includes 2,000 Common Shares issuable upon exercise of options within 60 days of May 7, 1999.
(4) Includes 5,829 Common Shares issuable upon exercise of common share purchase warrants.
(5) Includes 68,520 Common Shares issuable upon exercise of options within 60 days of May 7, 1999.
(6) Includes 82,520 Common Shares issuable upon exercise of options within 60 days of May 7, 1999.
(7) Includes 41,000 Common Shares issuable upon exercise of options within 60 days of May 7, 1999.
(8) Includes 41,000 Common Shares issuable upon exercise of options within 60 days of May 7, 1999
(9) Includes 327,560 Common Shares issuable upon exercise of options within 60 days of May 7, 1999 and
318,397 Common Shares issuable upon exercise of common share purchase warrants. Excludes shares
held by LaMont Asset Management S.A., New York Life, and Trianon Opus One, Inc.
</FN>
</TABLE>
<PAGE>
-5-
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>
-6-
DIRECTORS AND EXECUTIVE OFFICERS
The names of all of the members of the Board of Directors and the Executive
Officers of the Company, their principal occupations or employment during the
last 5 years and the dates on which they became Directors or Executive Officers
are as follows:
<TABLE>
<CAPTION>
=========================================================== ========================================================
Name and Present Principal Occupation Date First Appointed Director/Executive Officer
=========================================================== ========================================================
<S> <C>
R. William Anderson * June 26, 1992 (Director)
Vice President, Finance and Administration
and Chief Financial Officer
BioMarin Pharmaceutical Inc.
=========================================================== ========================================================
John H. Craig June 26, 1992 (Director)
Partner
Cassels Brock and Blackwell
=========================================================== ========================================================
John S. Glass August 3, 1994 (Director)
Vice President and Chief Financial Officer
Milkhaus Laboratory, Inc.
=========================================================== ========================================================
John C. Klock, M.D. * January 1, 1991 (President, Chief Executive Officer)
President and Chief Executive Officer June 26, 1992 (Director)
Glyko Biomedical Ltd.
President, Secretary and Director
BioMarin Pharmaceutical Inc.
=========================================================== ========================================================
Brian K. Brandley, Ph.D. April 1, 1998 (Managing Director)
Managing Director
Glyko Biomedical Ltd.
=========================================================== ========================================================
Gwynn R. Williams * June 26, 1992 (Director)
Physicist
=========================================================== ========================================================
Mark I. Young March 14, 1997 (Director)
Partner
Cassels Brock and Blackwell
=========================================================== ========================================================
<FN>
* - member of the Audit Committee
</FN>
</TABLE>
All Directors and Executive Officers have held the above positions throughout
the past five years, except that: Mr. Anderson was also Vice-President, Finance
and Chief Financial Officer of Fusion Medical Technologies, Inc. and Fidus
Medical Technology, Inc. and a Director (Consultant) at Recombinant Capital
during the five year period; 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.
<PAGE>
-7-
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.
Mr. R. William Anderson has served as a Director since 1992. Since June
1998, Mr. Anderson has been Vice President, Finance and Administration
and Chief Financial Officer at BioMarin Pharmaceutical Inc. From 1997 to
1998, Mr. Anderson was Vice President, Finance and Chief Financial Officer at
Fusion Medical Technologies, Inc., a surgical sealant company. Mr. Anderson
held the same position at Fidus Medical Technology, Inc., a developer
of microwave cardiac ablation equipment from 1996 to 1997. From 1994
to 1996, Mr. Anderson was a Director at Recombinant Capital, a consulting
firm specializing in strategic alliances in the biotechnology industry. From
1989 to 1994, Mr. Anderson served as Vice-President Finance and Chief Financial
Officer at Glycomed Incorporated, a therapeutic pharmaceutical company based
on complex carbohydrates. Mr. Anderson also held financial positions
as chief financial officer at Chiron Corporation and as controller and as
director of financial planning and analysis at Syntex Laboratories.
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 including Argentina Gold Corp.,
Consolidated HCI Holding Corporation, Consolidated Stanford Corporation, Derlan
Industries Limited, Gulfstream Resources Canada Limited, International Curator
Resources Ltd., LatinGold Inc., Lundin Oil AB, Oro Nevada Resources Inc., Red
Sea Oil Corporation, Scorpion Minerals Inc., TVX Gold Inc. and Tenke Mining
Corporation.
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, Mr. Glass
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 is currently a director of Li
Medical, Inc. and was a director of PDI, Inc. from 1987 to 1990.
Dr. John C. Klock has served as the President and Chief Executive Officer of
the Corporation since 1991 and as a Director since 1992. Since its
inception in March 1997, Dr. Klock has been the President and Director of
BioMarin Pharmaceutical Inc., a developer of carbohydrate enzyme therapeutics.
Dr. Klock was a founder of Glyko, Inc., a carbohydrate analytical and
diagnostic company and served as its President since inception in October
1989. Dr. Klock was a founder of Glycomed Incorporated, a therapeutic
pharmaceutical company based on complex carbohydrates, at which he served as
Vice President, Medical Affairs from July 1987 to July 1990. Dr. Klock was a
scientific director at the Institute of Cancer Research of California Pacific
Medical Center from July 1981 to July 1987. Dr. Klock was an academic
physician and carbohydrate researcher at the University of California at
San Francisco from 1982 to 1986.
Dr. Christopher M. Starr has been Vice President for Research and Development
of BioMarin Pharmaceutical Inc., a developer of carbohydrate enzyme
therapeutics, since its inception in March 1997. Dr. Starr was the Vice
President of Research and Development for Glyko, Inc., a carbohydrate
analytical and diagnostic company, since 1992 and for the year prior, he was
Glyko Inc.'s Director of Research and Development. Dr. Starr was a National
Research Council Associate and Intramural Research Training Award Fellow with
the National Institutes of Health prior to joining Glyko, Inc.
<PAGE>
-9-
Mr. Gwynn R. Williams has served as a Director since 1992 and was a founder
of Glyko, Inc., a carbohydrate analytical and diagnostic company
(established 1990). Mr. Williams was also founder and owner of AstroMed and
Astroscan, U.K. manufacturers of scientific equipment established in March
1984, which entities, in December 1997, merged into Life Science Resources
Ltd., a U.K. company. Previously, Mr. Williams was a partner in Arthur
Andersen & Co., a mathematician with G eneral Motors Research in Detroit and a
mathematician with British Steel. Mr. Williams also serves on the Board of
BioMarin Pharmaceutical Inc.
Mr. Mark I. Young has served a Director since March 1997 and has been the
Assistant Secretary of the Corporation since 1992. Mr. Young has been a
solicitor and partner with Cassels Brock and Blackwell and previously with
Holden Day Wilson, Toronto law firms, 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>
-9-
Section 16(A) Beneficial Ownership Reporting Compliance
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, 1998, 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 four meetings during
the year ended December 31, 1998 on January 22, June 18, July 22 and September
17. 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 and a Compensation 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 and
Williams and Dr. Klock. 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 met on June 11, 1998 to approve the Corporations
1997 financial statements.
The Audit Committee has reviewed the Corporation's 1998 financial statements and
has recommended that the Board of Directors approve those financial statements.
The Compensation Committee of the Board of Directors consists of Messrs.
Anderson and Williams. The Compensation Committee reviews the Company's
compensation structure for appropriateness and competitiveness, recommends
officer salaries to the Board, recommends officer and staff bonuses to the Board
and reviews retirement plan investments for adequate performance. The
Compensation Committee met on January 12, 1998.
<PAGE>
-10-
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table contains information about the compensation paid to, or
earned by, those who were, at December 31, 1998, the President, Chief Executive
Officer and Chief Financial Officer of the Corporation and the Managing Director
of the Corporation, 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.
Glyko Biomedical Ltd.:
<TABLE>
<CAPTION>
============================ ======== ========================================= ================== ===================
Name and Principal Position Long-term All Other
Year Annual Compensation 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,
Chief Financial Officer,
and Director
1998 18,750 -- -- 11,290(2) --
1997 97,226 -- -- 64,740(2) --
1996 187,297 -- -- 75,876(2) --
- ---------------------------- -------- ----------- ---------- ------------------ ------------------ -------------------
Brian Brandley(1)
Managing Director 1998 101,602 -- -- 150,000(2) --
- ---------------------------- -------- ----------- ---------- ------------------ ------------------ -------------------
<FN>
(1) On April 1, 1998, Brian Brandley, Ph.D. was appointed as Managing
Director of the Corporation and Christopher M. Starr, Ph.D. resigned as
Vice President of Research and Development.
(2) Options were assumed by BioMarin as part of the sale of Glyko, Inc. on
October 7, 1998. See "Interest of Insiders in Material Transactions."
</FN>
</TABLE>
<PAGE>
-11-
BioMarin Pharmaceutical Inc.(1):
<TABLE>
<CAPTION>
============================ ======== ========================================= ================== ===================
Name and Principal Position Long-term All Other
Year Annual Compensation 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 1998 222,450 87,500(2) -- 300,000 --
President and Director 1997 146,914 -- -- -- --
- ---------------------------- -------- ----------- ------------ ---------------- ------------------ ------------------
R. William Anderson 1998 90,484 -- -- 200,000 --
Vice-President, Finance
and Administration and
Chief Financial Officer
============================ ======== =========== ============ ================ ================== ===================
<FN>
(1) The Corporation owns 41% of BioMarin Pharmaceutical Inc. ("BioMarin").
Certain officers and directors of the Corporation are also officers and
directors of BioMarin.
(2) Includes amounts paid in 1999 for 1998.
</FN>
</TABLE>
Long-term Compensation Plans
Option Grants in 1998
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. 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 Common Shares on the trading day prior to the
date of grant. 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.
<PAGE>
-12-
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.
The following table provides details of stock options granted to the Named
Executive Officers during the fiscal year ended December 31, 1998 pursuant to
the Plan.
<TABLE>
<CAPTION>
- ------------------------- -------------- ------------------- ------------------ ------------------- --------------------
Market Value of
Securities % of Total Securities
Under Options Granted Underlying
Options to Employees in Exercise/Base Options of the
Name Granted Financial Year Price Date of Grant
(#)(1), (Cdn.$/Security) (Cdn.$/Security) Expiration Date
- ------------------------- -------------- ------------------- ------------------ ------------------- --------------------
<S> <C> <C> <C> <C> <C>
John C. Klock 11,290(2) 5% $1.25 $1.25 December 31, 2002
- ------------------------- -------------- ------------------- ------------------ ------------------- --------------------
Brian Brandley 150,000(2) 64% $3.45 $3.45 March 31, 2003
- ------------------------- -------------- ------------------- ------------------ ------------------- --------------------
<FN>
(1) Securities Under Options Granted refers to Common Shares.
(2) Options Granted in 1998 were assumed by BioMarin as part of the Glyko, Inc.
sale on October 7, 1998.
</FN>
</TABLE>
Options Exercised and Options Remaining
The following table provides detailed information regarding options exercised by
the Named Executive Officers and directors of the Corporation during 1998. In
addition, details on remaining options held are provided.
<PAGE>
-13-
<TABLE>
<CAPTION>
============================ ============ =============== =================================== ====================================
Value of Unexercised
Unexercised Options at in-the-money Options at
December 31, 1998 December 31, 1998(1)
------------- -------------- --------------- ------------------- ------------------ -----------------
Securities Aggregate
Acquired Value
on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
Name (#) (Cdn.$) (#) (#) (Cdn.$) (Cdn.$)
- ---------------------------- ------------- -------------- --------------- ------------------- ------------------ -----------------
<S> <C> <C> <C> <C> <C> <C>
R. William Anderson 20,000 $59,000 90,520 -- $535,340 --
- ---------------------------- ------------- -------------- --------------- ------------------- ------------------ -----------------
Brian Brandley (2) -- -- 28,125 121,875 $92,812 $495,000
- ---------------------------- ------------- -------------- --------------- ------------------- ------------------ -----------------
John H. Craig 20,000 $74,000 90,520 -- $535,340 --
- ---------------------------- ------------- -------------- --------------- ------------------- ------------------ -----------------
John S. Glass 20,000 $92,000 87,000 -- $515,100 --
- ---------------------------- ------------- -------------- --------------- ------------------- ------------------ -----------------
John C. Klock(2) (3) 534,672 $1,834,529 140,616 -- $923,646 --
- ---------------------------- ------------- -------------- --------------- ------------------- ------------------ -----------------
Gwynn R. Williams 20,000 $72,000 90,520 -- $535,340 --
- ---------------------------- ------------- -------------- --------------- ------------------- ------------------ -----------------
Mark I. Young -- -- 39,000 -- $228,300 --
============================ ============= ============== =============== =================== ================== =================
<FN>
(1) Based on the closing price of Common Shares on The Toronto Stock Exchange on
December 31, 1998 of Cdn.$6.75.
(2) Options were assumed by BioMarin as part of the sale of Glyko, Inc. on
October 7, 1998.
(3) These Common Shares acquired were purchase by a loan from the
Corporation. See "Indebtedness of Directors, Executive Officers And
Senior Officers."
</FN>
</TABLE>
COMPENSATION OF DIRECTORS
Each non-executive Director of the Corporation received 16,000 stock options in
1998 at an exercise price of Cdn.$1.25 expiring on December 31, 2002 in lieu of
monetary compensation for services rendered in their capacity as Directors in
1998. On January 28, 1999, each Director of the Corporation received 4,000 stock
options at an exercise price of Cdn.$6.00 expiring on December 31, 2003 for 1999
services as a Director.
<PAGE>
-14-
PERFORMANCE GRAPH
The following graph compares the Company's cumulative total shareholder return
with the cumulative total return of the TSE 300 Composite Index, assuming a $100
investment in Common Shares on December 31, 1993 and reinvestment of dividends
during the period. The period covered by the graph includes the fiscal years
ended December 31, 1994, 1995, 1996, 1997 and 1998.
Dec-93 Dec-94 Dec-95 Dec-96 Dec-97 Dec-98
TSE 300...... 100 99.8 114.3 146.7 168.7 166
The Company.. 100 29.8 22.8 14.0 43.9 236.8
<PAGE>
-15-
REPORT ON EXECUTIVE COMPENSATION
During the fiscal year ended December 31, 1998, the Compensation Committee
comprised Messrs. Anderson and Williams. The Compensation Committee met on
January 12, 1998. It is the responsibility of the Compensation Committee to
determine the level of compensation in respect of the Corporation's senior
executives with a view to providing such executives with a competitive
compensation package having regard to performance. Performance is defined to
include achievement of the Corporation's strategic objective of growth and the
enhancement of shareholder value through increases in the stock price resulting
from increases in sales and earnings in Glyko, Inc. and increase in value in its
holdings of BioMarin.
Compensation for executive officers is composed primarily of three components;
namely, base salary, performance bonuses and the granting of stock options.
Performance bonuses are considered from time to time having regard to the above
referenced objectives.
In establishing the levels of base salary, the award of stock options and
performance bonuses the Compensation Committee takes into consideration
individual performance, responsibilities, length of service and levels of
compensation provided by industry competitors.
In April 1998, the Committee reviewed the initial compensation of Dr. Brandley
in comparison to executives with similar responsibility, experience and autonomy
and determined that his compensation would be competitive for positions with
similar characteristics.
In 1997, the Board (acting to review compensation in lieu of a separate
committee meeting) reviewed and set Dr. Klock's compensation at an annual rate
of $250,000 which reflected the increased complexity of a new therapeutic
subsidiary and the increased demands of such an increase in responsibility. The
Board further agreed to a salary and general effort allocation of 30% to Glyko
and 70% to BioMarin. In April 1998, Dr. Klock began to devote essentially all of
his time to BioMarin and thereafter received no cash compensation as President
of Glyko. Dr. Klock's base salary was not increased in 1998 under these
circumstances.
Submitted by:
Mr. R. William Anderson
Mr. Gwynn Williams
INTEREST OF INSIDERS IN MATERIAL TRANSACTIONS
To the best of the Corporation's knowledge, none of the directors, senior
officers and principal shareholders of the Corporation or any respective
associates or affiliates of any director, senior officer or principal
shareholder of the Corporation had any direct or indirect interest in any
material transactions of the Corporation entered into since January 1, 1998,
save and except that:
On October 7, 1998, the Corporation sold 100% of the outstanding capital stock
of Glyko, Inc. to BioMarin. As consideration for such sale, BioMarin issued
2,259,039 shares of common stock of BioMarin to the Corporation, agreed to
assume options to purchase up to 585,969 Common Shares (which options were
previously issued to
<PAGE>
-16-
employees of Glyko, Inc.) and paid the Corporation $500 in cash. The shares of
BioMarin common stock were valued at $6.00 per share, yielding a total value of
$13,554,234, and the options assumed were valued at $945,765, which, when
combined with the $500 in cash, yields a total value for the consideration
received of $14,500,499. As a result of the sale of Glyko, Inc. the
Corporation's ownership interest in BioMarin increased to 41%. In conjunction
with the sale of Glyko, Inc., the Corporation converted approximately U.S.$3.8
million of intercompany loan to equity in Glyko, Inc. The remaining balance of
U.S.$1.2 million was repaid to the Corporation in cash. An independent committee
of disinterested Directors of the Corporation reviewed the offers from BioMarin,
negotiated changes in the size and structure of the payment for Glyko, Inc. and
recommended that the Board approve the sale.
Mr. Williams, a Director and Shareholder of the Corporation, is also a Director
of BioMarin and on November 17, 1997, was granted an option to purchase 20,000
shares of BioMarin's common stock at an exercise price of $1.00 per share for
his services as a Director of BioMarin. In March 1999, Mr. Williams was granted
an option to purchase 15,000 shares of BioMarin's common stock at an exercise
price of $7.00 per share for his services as a Director of BioMarin.
Dr. Klock, President, Chief Executive Officer and Director of the Corporation,
is also an officer of BioMarin and on October 1, 1997 purchased 800,000 shares
of BioMarin's common stock at $1.00 per share with a 3-year recourse note
secured by the stock. On June 22, 1998, Dr. Klock was granted an option to
purchase 300,000 shares of BioMarin's common stock at an exercise price of $4.00
per share. On January 15, 1999, Dr. Klock was granted an option to purchase
75,000 shares of BioMarin's common stock at an exercise price of $7.00 per share
as long-term equity compensation.
Dr. Starr, formerly an officer of the Corporation, is also an officer of
BioMarin and on October 1, 1997 purchased 400,000 shares of BioMarin's common
stock at $1.00 per share with a 3-year recourse note secured by the stock. On
June 22, 1998, Dr. Starr was granted an option to purchase 200,000 shares of
BioMarin's common stock at an exercise price of $4.00 per share. On January 15,
1999, Dr. Starr was granted an option to purchase 50,000 shares of BioMarin's
common stock at an exercise price of $7.00 per share as long-term equity
compensation.
Mr. R. William Anderson, a Director of the Corporation, is also an officer of
BioMarin and on June 22, 1998, was granted an option to purchase 200,000 shares
of BioMarin's common stock at an exercise price of $4.00 per share. On January
15, 1999, Mr. Anderson was granted an option to purchase 25,000 shares of
BioMarin's common stock at an exercise price of $7.00 per share as long-term
equity compensation. On March 22, 1999, Mr. Anderson was granted an option to
purchase 4,573 shares of BioMarin's common stock at an exercise price of $7.00
per share.
LaMont Asset Management, S.A., a 12% Shareholder of the Corporation, is also
owns 935,000 shares of BioMarin.
<PAGE>
-17-
INDEBTEDNESS OF DIRECTORS
EXECUTIVE OFFICERS AND SENIOR OFFICERS
Other than as described below, no director, senior officer or executive officer
of the Corporation or associate of any director, senior officer or executive
officer is, or at any time since the beginning of the most recently completed
financial year has been, indebted to the Corporation.
Pursuant to the Share Exchange Agreement under which the Corporation sold Glyko,
Inc. to BioMarin, the Corporation has loaned Cdn.$1,106,167 to Dr. John Klock to
purchase Common Shares of the Corporation upon the exercise of stock options
held by Dr. Klock as set forth below. The loans are evidenced by an interest
bearing promissory notes due on demand.
The following table sets forth any indebtedness of directors, senior officers or
executive officers of the Corporation entered into in connection with the
purchase of securities of the Corporation.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
Largest Amount of Outstanding
Name of Borrower Outstanding Indebtedness as of Number of Common Security for
Lender Indebtedness December 31, 1998 Shares Purchased Indebtedness
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
John C. Klock Corporation Cdn.$1,106,167 Cdn.$1,106,167 532,672 532,672 Common
Shares
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
During fiscal 1997 Dr. Klock purchased 800,000 shares of common stock of
BioMarin in exchange for a note maturing on July 31, 2000. The note is secured
by the underlying stock.
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:
o long term strategic planning
o risk analysis and monitoring of risk management systems
o overseeing the appointment and training of senior management and
monitoring their performance, including succession planning
o establishing and monitoring the Corporation's communications
policy and ensuring that it addresses the feedback and concerns
of shareholders in particular
o ensuring the integrity of the Corporation's systems for internal
controls and management information
o developing and implementing the Corporation's corporate governance
guidelines
o approval of the annual operating and capital budgets
<PAGE>
-18-
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 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.
Audit Committee
The Audit Committee consists of three directors, a majority of whom are outside
directors. It carries out the following responsibilities:
o reviewing the Corporation's audited financial statements
o meeting with the Corporation's management and auditors for that purpose
Compensation Committee
The Compensation Committee consists of two directors, both of whom are outside
directors. It carries out the following responsibilities:
o review compensation structure for appropriateness and competitiveness
o recommend officer salaries to the Board of Directors
o recommend officer and staff bonuses to the Board of Directors
o reviews retirement plan investments for adequate performance
<PAGE>
-19-
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 Andersen 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, 1998 and 1997 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, 1999. 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.
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, 1999
/s/John C. Klock, M.D.
John C. Klock, M.D.
President, Chief Executive Officer
and Chief Financial 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 24, 1999
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 24th day of June, 1999, 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 , 1999.
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. Proxies to be used at the Meeting or any adjournments thereof must be
received at the registered office of the Corporation or its transfer agent not
less than 48 hours prior to the time of the Meeting or any adjournments thereof.
4. This proxy ceases to be valid one year from its date.
5. Please date the proxy. If not dated, the proxy shall be deemed to be dated on
the day on which it is mailed.
6. 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.
371 BEL MARIN KEYS BLVD., SUITE 210
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
4/30/99
Glyko Biomedical Ltd.
First Quarter Report
March 31, 1999
<PAGE>
To our stockholders:
Since Glyko Biomedical Ltd.'s equity position in BioMarin Pharmaceutical Inc
represents the principal asset of the Company, we submit the following report on
major drug development programs in BioMarin for your review:
BioMarin completed what it believes is a successful pivotal clinical trial of
(alpha)-L-iduronidase (BM101), as an enzyme replacement treatment for
mucopolysaccharidosis-I disease called MPS-I. On behalf of the BioMarin-Genzyme
joint venture, BioMarin intends to complete and file a Biological License
Application (BLA) with the U.S. Food and Drug Administration (FDA) in the second
half of 1999. BioMarin believes that trial results are sufficient for approval
of the BLA. BioMarin has begun a development effort for the treatment of MPS-VI,
known as Maroteaux-Lamy syndrome, a genetic disorder caused by a deficiency of
the enzyme N-acetylgalactosamine 4-sulfatase. Preclinical studies are being
conducted on cats with feline MPS-VI. BioMarin believes that these studies will
provide a sufficient basis with respect to the safety, efficacy and appropriate
dosage to support an Investigational New Drug (IND) application to initiate
human clinical trials. BioMarin intends to file an IND for this enzyme in the
fourth quarter of 1999. BioMarin also intends to develop additional enzyme
replacement therapies, like those already described, for other genetic diseases.
BM201 and BM202 are enzyme therapies for debridement of full thickness (third
degree) burns. Burn studies in mice and pigs have been done without significant
signs of topical or systemic toxicity. These enzymes significantly reduced the
total time in which grafts were successfully made and wounds closed when
compared to controls and to selected topical enzymatic products. The total time
required for the debridement and graft take compared favorably to that obtained
using standard surgical debridement techniques. BioMarin hopes to begin human
trials in 1999.
BM301 and BM302 are recombinant forms of two naturally occurring enzymes, to
treat aspergillosis, a serious fungal infection especially for
immune-compromised patients. In preclinical studies on mice conducted at Boston
University Medical Center, BM301 and BM302 effectively treated aspergillosis. No
toxicity or other adverse side effects were observed in these animal studies.
BioMarin intends to apply for FDA orphan drug designation for these anti-fungal
enzymes and hopes to begin human studies after additional toxicology and
efficacy studies.
This report contains forward-looking statements including, but not limited to,
the prospects for the expected timing of filing of a BLA and INDs and the
expected sufficiency of BM101 clinical data to support a possible BLA approval
by the FDA. Actual results may differ materially from those discussed in the
forward-looking statements as a result of future business and technology
developments, the progress of the BioMarin-Genzyme joint venture in developing
its BLA, and decisions made by regulatory agencies.
/s/John C. Klock, M.D.
John C. Klock, M.D.
President, Chief Executive Officer
and Chief Financial Officer
May 14, 1999
<PAGE>
GLYKO BIOMEDICAL LTD.
CONDENSED BALANCE SHEETS
(In U.S. dollars)
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
---------------- ----------------
<S> <C> <C>
Assets (Unaudited)
Cash $ 4,773,081 $ 2,567,824
Other current assets 20,700 109,710
Investment in BioMarin Pharmaceutical Inc. 12,740,908 14,578,497
Non-current assets 712,261 712,261
---------------- ----------------
Total assets $ 18,246,950 $ 17,968,292
================ ================
Liabilities and Stockholders' Equity
Total current liabilities $ 370,704 $ 411,109
Non-current liabilities - -
---------------- ----------------
Total liabilities 370,704 411,109
Stockholders' equity
Common stock, no par value, unlimited
shares authorized, 31,453,374 and
28,020,234 shares issued and outstanding
at March 31, 1999
and December 31, 1998, respectively 20,527,515 17,963,167
Common stock warrants 165,261 547,285
Accumulated deficit (2,816,530) (953,269)
---------------- ----------------
Total stockholders' equity 17,876,246 17,557,183
---------------- ----------------
Total liabilities and stockholders' equity $ 18,246,950 $ 17,968,292
================ ================
</TABLE>
<PAGE>
GLYKO BIOMEDICAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in U.S. dollars)
<TABLE>
<CAPTION>
Three months ended
March 31,
-------------------------------------------
1999 1998
------------------- ---------------------
<S> <C> <C>
Revenues:
Sales of products and services $ - $ 306,559
Other revenues - 99,135
------------------- ---------------------
Net revenues - 405,694
Expenses:
Cost of products and services - 88,513
Research and development - 163,685
Selling, general and
administrative 66,914 184,074
------------------- ---------------------
Total costs and expenses 66,914 436,272
------------------- ---------------------
Income (loss) from operations (66,914) (30,578)
Equity in loss of BioMarin
Pharmaceutical Inc. (1,837,588) (544,538)
Interest income 41,241 5,800
------------------- ---------------------
Net loss $ (1,863,261) $ (569,316)
=================== =====================
Earnings per share - basic and
fully-diluted $ (0.06) $ (0.03)
=================== =====================
Weighted average number of
shares 29,460,589 21,880,055
=================== =====================
</TABLE>
<PAGE>
GLYKO BIOMEDICAL LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in U.S. dollars)
<TABLE>
<CAPTION>
Three months ended
March 31,
--------------------------------------
1999 1998
----------------- -----------------
<S> <C> <C>
Net loss $ (1,863,261) $ (569,316)
Adjustments to reconcile net loss to net cash
used in operating activities: 1,844,260 492,703
----------------- -----------------
Net cash used in operating activities (19,001) (76,613)
Net cash used in investing activities - (3,659)
Net cash provided by financing activities 2,224,258 311,118
----------------- -----------------
Net increase in cash 2,205,257 230,846
Cash and cash equivalents, beginning of period 2,567,824 528,280
----------------- -----------------
Cash and cash equivalents, end of period $ 4,773,081 $ 759,126
================= =================
</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, 1999 and for the three month periods ended March 31, 1999 and
1998, 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. As of December 31, 1997,
the Company began recording its pro rata share of its 41 percent owned
affiliate, BioMarin Pharmaceutical Inc., utilizing the equity method of
accounting. 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, 1998.
<PAGE>
Stockholder Information
Transfer Agent:
If you have questions about your stock certificates, or 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 1998 Annual Report, be
added to our mailing list or receive other information, please direct your
request to:
Glyko Biomedical Ltd.
371 Bel Marin Keys Blvd., Suite 210
Novato, California 94949
tel: (415) 884-6799
fax: (415) 382-7427
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 Berlin Exchange under
BVD - Berlin:GLY.
