AURORA, ON, Jan. 10 /PRNewswire-FirstCall/ - Helix believes that the dissident proxy circular recently issued by Mr. Herald A.M.A. Janssen on behalf of his company, International Penta Financial Services AG, is self serving and not in the best interest of Helix shareholders, and recommends that all shareholders vote only their YELLOW Helix proxy in favour of the resolutions stated therein. Shareholders may revoke any proxy already given pursuant to the solicitation of proxies by the dissident group by completing and delivering a later dated YELLOW Helix proxy.
Upon reviewing the dissident proxy circular, Mr. Janssen's objective to change the Helix Board appears to be related to the fact that Helix intends to seek additional capital in the near term by way of private placement financing.
- Mr. Janssen contests Helix's financing plans, yet his associated company, MJM Management Co. Est., functioned until December 1st, 2006 as a finder for Helix for precisely this type of financing. His associated company has been paid in excess of $700,000 in this regard. - Before the recent expiry of his associated company's finder arrangement, Mr. Janssen proposed financings of upwards of US$20 million with less favourable terms than Helix is now proposing. These proposals were not accepted by Helix, upon careful consideration and advice of its financial and legal advisors. - Helix believes that this dissident action is solely based on Mr. Janssen's loss of further opportunity to gain financially from his proposals. - Helix continues to act in the best interest of all shareholders, and is committed to undertaking activities that are intended to result in the expeditious commercialization of its new drug product candidates, L-DOS47 and Topical Interferon Alpha-2b.
A copy of Helix's detailed response and analysis to the dissident proxy circular is attached to this press release and has been filed on SEDAR at www.sedar.com and is also available at www.helixbiopharma.com.
Helix recommends that all shareholders discard the dissident proxy and vote only their YELLOW Helix proxy in favour of the resolutions stated therein. Proxies must be returned by January 19, 2007 at 10:00 am Toronto time for your vote to count. A copy of Helix BioPharma's current Annual Report and Management Information Circular for the January 23, 2007 meeting can be found on SEDAR at www.sedar.com, and at Helix's website at www.helixbiopharma.com. Requests for a hard copy of the Annual Report or Management Information Circular can also be made to Georgeson. For more information call Georgeson, Helix's proxy solicitor at their North American toll free number 1-866-288-9745, or European(x) toll free number 00800-1020-1010. Collect calls outside North America can be made at +1-416-642-7018 or +44(0)117-378-5993.
Georgeson North American Toll Free Number: 1-866-288-9745 Outside North America Collect: +1-416-642-7018 (x)Toll Free - European: 00800 1020 1010 European Collect: +44 (0) 117 378 5993 (x)Australia; Austria; Belgium; Denmark; Finland; France; Germany; Hong Kong; Ireland; Israel; Italy; Netherlands; New Zealand; Norway; Spain; Sweden; Switzerland; Thailand; United Kingdom Please visit our website for regular updates at www.helixbiopharma.com
This document contains certain forward-looking information and statements regarding the Company's beliefs, plans and objectives.
Forward-looking information and statements are not historical facts but are predictions about the future and are inherently uncertain. Forward-looking information and statements can be identified by the use of forward-looking terminology such as "2007", "2008", "to be", "believes", "appears", "opportunity", "to gain", "continues", "committed", "recommends", "intends", "undertaking", or the negative thereof or any other variations thereon or comparable terminology referring to future events or results, or that events or conditions "will", "may", "could", "would", or "should" occur or be achieved, or comparable terminology referring to future events or results.
The Company's actual results could differ materially from a conclusion, forecast or projection in its forward-looking information and statements due to a variety of risks, uncertainties and other factors, including, without limitation: uncertainty as to the outcome of the January 23, 2007 shareholders meeting; uncertainty whether the Company will be able to complete any financing on the terms proposed or at all; liquidity risks, including the ability of the company to maintain a listing on a stock exchange, or the ability of the Company to secure listing on other stock exchanges; uncertainty whether any of the Company's proposed drug products will be successfully developed or at all; the need for future clinical trials, the occurrence and success of which cannot be assured; the need for regulatory approvals, which approvals may not be obtained on acceptable terms or at all or may be withdrawn; research and development risks; uncertainty whether the L-DOS47 preclinical program will be completed as planned or at all; uncertainty whether an IND will be compiled or submitted for L-DOS47 as currently planned or at all, or if submitted, whether the Company will be permitted to undertake human testing; uncertainty whether the manufacturing process for L-DOS47 can be scaled-up successfully or at all; manufacturing risks and the need to manufacture to regulatory standards; the need for performance by buyers of the Company's products; reliance by the Company on a few customers and a few suppliers; uncertainty regarding the Company's ability to generate projected sales volumes and product prices; uncertainty of the size and existence of a market opportunity for, and market acceptance of, the Company's products and those of its customers and licensees; the need to secure new contracts and new strategic relationships, which is not assured; intellectual property risks; marketing risks; uncertainty as to availability of raw materials on acceptable terms or at all; partnership/strategic alliance risks and in particular, the need for performance by the Company's licensees, Lumera Corporation and Helsinn-Birex; product liability risks; the effect of competition; the risk of unknown side effects; the Company's need for additional future capital, which may not be available in a timely manner or at all; exchange rate fluctuations; environmental risks; political risks; the risk of technical obsolescence; the possibility that the Company will pursue additional development projects or other business opportunities; the risk of unanticipated expenses; market volatility; the need to attract and retain key personnel; and other factors that are discussed or identified in the Company's latest Annual Information Form filed on SEDAR at www.sedar.com any of which could cause actual results to vary materially from current results or the Company's anticipated future results. Forward-looking statements are based on the assumptions, beliefs, opinions and expectations of the Company's management at the time they are made, and the Company does not assume any obligation to update its forward-looking statement if those assumptions, beliefs, opinions or expectations, or other circumstances should change. For the reasons set forth above, investors should not place undue reliance on forward-looking statements. The Company does not assume any obligation to update any statement contained in this document.
January 10, 2007 Dear Fellow Helix Shareholder:
I am writing to ask for your support at Helix's Annual General and Special Meeting of Shareholders on Tuesday, January 23, 2007.
As you may know, Mr. Herald Janssen of International Penta Financial Services AG has proposed a dissident slate of directors for election to replace your Company's Board of Directors. Helix's Board of Directors and Management unanimously recommend that you DO NOT support the dissident nominees.
Following is a detailed response to the dissident proxy circular issued by International Penta Financial Services AG. If you have any questions or need assistance voting, please contact Georgeson, Helix's proxy solicitor, at one of the contact numbers listed at the end of the detailed response accompanying this letter.
Sincerely (signed) Donald H Segal President and CEO Helix Biopharma Corp. ------------------------------------------------------------------------- YOUR VOTE IS IMPORTANT PROTECT YOUR INVESTMENT IN HELIX PLEASE SIGN, DATE AND RETURN THE YELLOW HELIX PROXY FORM YOU HAVE RECEIVED ------------------------------------------------------------------------- Detailed Response by Management of Helix BioPharma Corp. to Dissident Proxy Circular Issued by International Penta Financial Services AG in Connection with the Annual General and Special Meeting of Helix Shareholders Scheduled for January 23, 2007 Introduction ------------
A dissident proxy circular was issued on January 4th, 2007 by International Penta Financial Services AG in connection with the Annual General and Special Meeting of the shareholders of Helix BioPharma Corp. ("Helix" or the "Company") scheduled for January 23, 2007. As noted therein, Mr. Herald A.M.A. Janssen is the Chairman of the Board of Directors of International Penta Financial Services AG, and controls or is deemed to beneficially own all Helix shares owned by International Penta Financial Services AG.
As stated therein, Mr. Janssen has written an open letter to shareholders and has signed the dissident proxy circular on behalf of International Penta Financial Services AG.
Helix believes that Mr. Janssen's main points of contention with the Company relate to the fact that Helix intends to seek additional capital in the near term by way of private placement financing.
Helix believes that Mr. Janssen's motivation for pursuing a dissident position is that Helix did not accept financing proposals put forth by his associated company MJM Management Co. Est., and has allowed MJM's finder's fee agreement to expire on December 1, 2006.
Helix believes that Mr. Janssen is attempting to gain control of the Company to satisfy his own self interest, and has not offered any viable strategic alternative to maximize shareholder value.
Helix has therefore prepared the following detailed response to Mr. Janssen's dissident proxy circular, in order to refute the points he has raised and demonstrate the strength and commitment of Helix's existing Management and Board members, and their continued dedication to realizing Helix's objectives.
Private Placement ----------------- Timing
Helix has projected that it has sufficient capital to fund operations, including drug product development, through to July 2008. Assuming no further funds are raised by the Company between now and July 2008, Helix's cash and cash equivalents as at the end of July 2008 will be zero.
In light of the progress being made in Helix's drug development programs, the Company wishes to raise additional capital beyond its current reserves, in order to accelerate its clinical development activities with a view to more quickly realizing its commercial objectives.
In addition, prudent financial management practice dictates that Helix maintains flexibility in being able to capitalize the Company in an efficient manner. In this regard, Management recognizes that, at the present operating level, as of January 23, 2007, Helix will only have 6 months of cash on hand before it risks a going concern disclosure note in its financial statements, which could potentially have a negative impact in the Company's ability to raise needed capital to fund its ongoing drug product development.
In addition, the proposed private placement resolution, as pre-cleared by the Toronto Stock Exchange, expires on April 12, 2007.
The market for equity financings for companies such as Helix is challenging, and there can be no assurance that additional funding by way of equity financing will be available or when conditions will be favourable. The failure of the Company to obtain additional funding on a timely basis may result in the Company reducing or delaying one or more of its planned research, and development activities which could impair the current and future value of the business.
Management feels that it is not in the best interest of all shareholders for the Company to delay and risk being in a situation where it is desperately seeking funding and may, as a result, be forced to pursue financings with overly high costs of capital and be even more dilutive.
Does Mr. Janssen not comprehend these fundamental aspects of managing the finances of a development stage biopharmaceutical company?
Dilution
Dilution is necessary in order to secure the capital needed to expedite the development of Helix's new drug product candidates. In fact, dilution in the short term will enhance long term shareholder value by bringing the Company closer to realizing its commercial objectives.
Helix therefore believes that Mr. Janssen has ignored the essence of the Company's proposed resolution. The resolution has been worded so as to provide flexibility, but Helix will of course endeavor to secure the best possible financing terms in the interest of all shareholders.
Resolutions of this sort are standard. In previous annual meetings, Helix has sought and obtained shareholder resolutions authorizing far more dilutive placements. As Mr. Janssen is well aware, the purpose of such resolutions is not to commit to the terms of a financing, but rather to provide the Company with the flexibility to arrange suitable financing. In fact, the resolution proposed to shareholders is the least dilutive ever sought by Helix in terms of percentage of outstanding capital.
Furthermore, following the proposed private placement, Helix expects to have approximately 50 million shares outstanding, which is certainly not high relative to comparable biopharmaceutical companies. In point of fact, a well managed dilutionary process is vital during the growth of a company, particularly as it prepares for entry to larger capital markets.
It is important to note that, at present, Helix has not received any firm or conditional subscription agreements, and does not anticipate receiving any until shareholder approval has first been obtained at Helix's Annual General and Special Meeting of the Shareholders, scheduled for January 23, 2007.
Fees and Commissions
Historically, the cost of private placements to Helix in terms of pricing the placement at a discount to market and payment of finder's fees has never been more than a combined 17.5% of the relevant market price. It is Helix's intention not to exceed this composite amount in the future, and the proposed resolution by Helix is designed to achieve this.
The Toronto Stock Exchange has pre-cleared the resolution as presented in Helix's Management Information Circular.
New Private Placees
The main reason for Helix to issue shares and raise capital now, is to expedite the development of its new drug products, in order to realize its commercial objectives in a timely manner and maximize shareholder value.
Furthermore, due to the fact that investment in the biotechnology sector is a long term proposition with considerable risk, Helix continues to approach investors who understand the industry. Helix is categorically not looking for investors to entrench Management's position or control over the company. Rather, as stated above, Helix is looking to attract patient investors that understand the risks and rewards associated with an investment in Helix.
Share Price
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A review of the biotechnology market sector reveals that similar Canadian biotechnology companies have suffered comparable reductions in market capitalization over the past year.
Based upon Mr. Janssen's dissident proxy circular, it is important to note that Mr. Janssen was a significant seller of Helix shares since April 1, 2005. Mr. Janssen personally and International Penta Financial Services AG reported sales of Helix shares totalling 1,435,000 between April 1, 2005 through to June 16, 2006.
Did Mr. Janssen think that this action would positively impact Helix's share price?
Helix's share price performance relative to the iShares Nasdaq Biotech Index is demonstrated below, through which one can see that the Helix share price has largely outperformed this index over the past 5 years.
5 year share performance - Helix versus iShares Nasdaq Biotech http://files.newswire.ca/572/HelixversusiShares.doc Institutional Investment and Listing ------------------------------------
The Company made progress through the course of 2006 towards introducing Helix to the U.S. capital markets. Helix had meetings with several prominent New York based investment banks last year, many of which Mr. Janssen attended.. Through the course of these meetings, all parties including Mr. Janssen agreed that Helix's best corporate strategy would be to continue to raise interim capital through private placements, as it had done historically, up to the point that it achieves certain defined advanced product development milestones.
Many of the banks visited also indicated that they would be very interested in assisting Helix thereafter, if it so desired, in pursuing an offering in the USA, in concert with Helix listing on a major U.S. exchange.
Helix Board of Directors ------------------------ Expertise
The Board and Management of Helix have specific expertise concerning the Company's development programs. The proposed Board consists of seasoned biotech and pharmaceutical executives with more than a combined 100 years of related experience. This Board will also include senior medical practitioners, including the addition of Dr. Gordon Lickrish, as well as legal and accounting professionals with extensive global experience.
Furthermore, it is worth noting that substantial changes to the Board as proposed by Mr. Janssen could potentially result in the loss of key scientific and operational personnel that could either temporarily or indefinitely delay the further advancement of Helix's drug product development programs.
Independence
Helix has taken a number of steps in recent years to establish the independence of its Board of Directors. In 2005, the Company appointed Mr. Jack Kay to the Board and in its proposed slate for approval at the upcoming meeting of shareholders the Company has put forward the name of Dr. Gordon Lickrish as a fourth independent director. Upon approval of Management's recommended slate, a majority of the Board will be independent.
Furthermore, it is worth noting that at least two of the candidates, specifically Axel Wellman and Edward M.A. Mier-Jedrzejowicz, put forth by Mr. Janssen in his dissident filing are also presently associated with companies controlled by Mr. Janssen.
Board Allegiance
All of the current directors of Helix, specifically Jerome McElroy, Donald Segal, Connor Gunne, Kenneth Cawkell, Richard Rossman and Jack Kay, have indicated their intention to stand for re-election to the Helix Board, along with their intention to vote for all of the resolutions proposed in Helix's Management Information Circular.
Bylaws
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The Company has amended By-Law # 1 to allow the Chairman of a meeting of shareholders to adjourn the meeting, without first requiring the consent of shareholders. The Company seeks this amendment to provide the Chairman of a shareholder's meeting with the necessary authority to adjourn the meeting, if required, pending resolution of any issues that may arise at the meeting, and in particular, issues which may be in dispute between shareholder groups. In exercising this authority, the Chairman cannot act in an arbitrary manner, but rather, is obligated to act impartially and in the best interest of all shareholders. Mr. Janssen's concern that the Chairman would use his authority to defeat the will of the shareholders is totally without foundation.
Investor Relations / Timely Events Disclosure
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Helix, as a Toronto Stock Exchange listed company, makes timely and accurate disclosure of all significant events in full compliance with applicable securities laws and policies, and the rules of the Toronto Stock Exchange.
With regard to specific investor inquires, Helix not only responds directly, but has also hired two leading life sciences communications firms, The Equicom Group and US-based Noonan Russo (a division of Euro RSCG Life PR) to liaise with investors.
In addition Helix has conducted extensive presentations in cities in Germany, Poland, The Netherlands, Switzerland, Slovenia, Hungary, and other countries over the past several years. Furthermore, in order to demonstrate Helix's appreciation of its diverse shareholder base, the Company has traditionally issued all news releases in English and German, and more recently has started to issue them in Polish.
Strategic Plan
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Helix through the combined efforts of its Management and Board, has developed a well thought out and focused strategic plan to develop and commercialize its drug product candidates, L-DOS47 and Topical Interferon Alpha-2b, in concert with advancing the Company's financial position and profile in the quarters that lie ahead. To date, this plan has been implemented with great success in a fiscally responsible manner relative to the Company's available operating capital, as demonstrated by Helix's milestone achievements reported during 2006, including completing enrollment in a Phase II study for the Company's Topical Interferon Alpha 2b product, initiating a second Phase II trial for another indication, and furthering the development of its L-DOS47 drug product candidate with a view to commencing Phase I human clinical testing.
Conclusions
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Helix believes that Mr. Janssen is willing to risk the Company and its technologies in order to generate fees for himself and his companies. Although he comments favourably on the Company's science and technology, his actions risk losing Management and Scientific personnel that are critical for the successful development of the Company's technologies. Mr. Janssen undertakes this irresponsible adventure at a sensitive time in the Company's development, despite the fact that all goals and objectives, financial, technical and otherwise, are being met in a timely and fiscally responsible manner. Mr. Janssen euphemizes that his crippling actions would be merely a "fresh look at Helix". Mr. Janssen does not offer the Company's shareholders any direction, strategy or plan. Rather, Helix firmly believes that he merely wants to keep earning fees.
Helix reaffirms that it recommends that all shareholders vote only their YELLOW Helix proxy in favour of the resolutions stated therein. Proxies must be returned by January 19, 2007 at 10:00 am Toronto time for your vote to count.
You may revoke any proxy already given pursuant to the solicitation of proxies by the dissident group by completing and delivering a later dated YELLOW Helix proxy. A later dated YELLOW Helix proxy automatically revokes any and all prior proxies given in connection with the Annual General and Special Meeting.
A copy of Helix BioPharma's current Annual Report and Management Information Circular for the January 23, 2007 meeting can be found on SEDAR at www.sedar.com, and at Helix's website at www.helixbiopharma.com. Requests for a hard copy of the Annual Report or Management Information Circular can also be made to Georgeson. For more information call Georgeson, Helix's proxy solicitor at their North American toll free number 1-866-288-9745, or European(x) toll free number 00800-1020-1010. Collect calls outside North America can be made at +1-416-642-7018 or +44(0)117-378-5993.
Georgeson North American Toll Free Number: 1-866-288-9745 Outside North America Collect: +1-416-642-7018 (x)Toll Free - European: 00800 1020 1010 European Collect: +44 (0) 117 378 5993 (x)Australia; Austria; Belgium; Denmark; Finland; France; Germany; Hong Kong; Ireland; Israel; Italy; Netherlands; New Zealand; Norway; Spain; Sweden; Switzerland; Thailand; United Kingdom Please visit our website for regular updates at www.helixbiopharma.com
This document contains certain forward-looking information and statements regarding the Company's beliefs, plans and objectives.
Forward-looking information and statements are not historical facts but are predictions about the future and are inherently uncertain. Forward-looking information and statements can be identified by the use of forward-looking terminology such as "2007", "2008", "to be", "objectives", "look forward", "intend", "to continue", "to further", "to ensure", "believe", "if", "to conduct", "attempting", "potential", "proposal", "projected", "delay", "achieve", "progress", "intend", "seeks", "demonstrate", "develop", "completing", "initiating", "completing", "furthering", "poised", "feels", "determined", "new", or the negative thereof or any other variations thereon or comparable terminology referring to future events or results, or that events or conditions "will", "may", "could", "would", or "should" occur or be achieved, or comparable terminology referring to future events or results.
The Company's actual results could differ materially from a conclusion, forecast or projection in its forward-looking information and statements due to a variety of risks, uncertainties and other factors, including, without limitation: uncertainty as to the outcome of the January 23, 2007 shareholders meeting; uncertainty whether the Company will be able to complete any financing on the terms proposed or at all; liquidity risks, including the ability of the company to maintain a listing on a stock exchange, or the ability of the Company to secure listing on other stock exchanges; uncertainty whether any of the Company's proposed drug products will be successfully developed or at all; the need for future clinical trials, the occurrence and success of which cannot be assured; the need for regulatory approvals, which approvals may not be obtained on acceptable terms or at all or may be withdrawn; research and development risks; uncertainty whether the L-DOS47 preclinical program will be completed as planned or at all; uncertainty whether an IND will be compiled or submitted for L-DOS47 as currently planned or at all, or if submitted, whether the Company will be permitted to undertake human testing; uncertainty whether the manufacturing process for L-DOS47 can be scaled-up successfully or at all; manufacturing risks and the need to manufacture to regulatory standards; the need for performance by buyers of the Company's products; reliance by the Company on a few customers and a few suppliers; uncertainty regarding the Company's ability to generate projected sales volumes and product prices; uncertainty of the size and existence of a market opportunity for, and market acceptance of, the Company's products and those of its customers and licensees; the need to secure new contracts and new strategic relationships, which is not assured; intellectual property risks; marketing risks; uncertainty as to availability of raw materials on acceptable terms or at all; partnership/strategic alliance risks and in particular, the need for performance by the Company's licensees, Lumera Corporation and Helsinn-Birex; product liability risks; the effect of competition; the risk of unknown side effects; the Company's need for additional future capital, which may not be available in a timely manner or at all; exchange rate fluctuations; environmental risks; political risks; the risk of technical obsolescence; the possibility that the Company will pursue additional development projects or other business opportunities; the risk of unanticipated expenses; market volatility; the need to attract and retain key personnel; and other factors that are discussed or identified in the Company's latest Annual Information Form filed on SEDAR at www.sedar.com any of which could cause actual results to vary materially from current results or the Company's anticipated future results. Forward-looking statements are based on the assumptions, beliefs, opinions and expectations of the Company's management at the time they are made, and the Company does not assume any obligation to update its forward-looking statement if those assumptions, beliefs, opinions or expectations, or other circumstances should change. For the reasons set forth above, investors should not place undue reliance on forward-looking statements. The Company does not assume any obligation to update any statement contained in this document.
Helix BioPharma Corp.CONTACT: Georgeson, Helix's proxy solicitor, at their North American tollfree number 1-866-288-9745, or European(x) toll free number00800-1020-1010; Collect calls outside North America can be made at (416)642-7018 or +44(0)117-378-5993