Robert Proulx, Imagion Biosystems’ President & CEO:
[00:00:00] On April 24th, we sent out the notice of meeting for our annual general meeting scheduled for May 25th. That notice includes all the information IBX shareholders need for participating in the meeting and registering their votes. We know the language used in the notice of meeting can sometimes be difficult to understand. It’s formal and full of legalese. So with the meeting now only a few weeks away, we thought it might be helpful to provide a brief explanation of some of the key resolutions [00:00:30] being put forward at this year’s meeting. And I apologize for reading from a script, but I want to be sure to correctly inform our shareholders of what the resolutions are asking you to consider.
Resolutions one, two, and three concern the adoption of the remuneration report and the election of two of our directors. And these should be self-explanatory.
Resolution four has to do with the approval of a new employee incentive plan. This is a statutory resolution due to the fact that it has been three years since the last incentive plan was approved, and there’s a [00:01:00] legal requirement for the company to periodically adopt a new overarching plan.
There are no fundamental changes to the employee incentive plan from the previous plan, but we are required to renew and review the plan every three years. We hope this resolution will be approved so that we can continue to have employees incentivized to stakeholders in the company.
Resolution five is related to the recent $1.5 million investment made by Mercer Street Capital, which occurred in April, coincident with the entitlement offer. [00:01:30] Shares, convertible notes and options that were issued in this first trache were issued against our standing 15% placement capacity. If shareholders approve this resolution, it means we refresh this 15% placement capacity, which will ensure we have the capital management resources needed as we move further into the clinic and towards our IND filing for undertaking our Phase 2 study in the US.
Resolution six seeks the approval of the issuance of additional options for Mercer. [00:02:00] These options were also due to Mercer as part of the 1.5 million financing, but were not included in our 15% placement capacity. If the resolution is not approved, we would be required to pay Mercer $250,000 in lieu of those options, and we’d prefer not to do that as it uses valuable cash.
Resolution seven concerns approving an additional $1 million as a second tranche of financing in the form of convertible notes and options to Mercer. [00:02:30] This would bring the total financing for Mercer to $2.5 million, which is vital for funding our company.
Resolution eight is asking shareholders to approve the future issue of subsequent tranches of convertible notes and subsequent tranches of options to Mercer. If shareholders approve this resolution, then it gives the company the ability to use their Mercer facility at our discretion for the next three months and take subsequent drawdowns without having to appro get separate shareholder [00:03:00] approval or use our placement capacity. Given that capital markets are tepid at best and may continue to be so for some time period, this is an important resolution as it will allow us to ensure we have short-term working capital under prearranged conditions.
Resolution nine concerns the company needing to adopt a new Constitution to be in alignment with our new employee incentive plan. The new Constitution would provide a 10% cap on the EIP.We use the EIP as a tool to [00:03:30] attract and retain employees because apart from market-based wages, this is one of our main tools to attract and retain employees without using additional cash incentives.
And finally, Resolution 10 is the standard resolution related to refreshing our ability to utilize the ASX listing Rule 7.1 A, the 10% placement facility. This resolution has been approved every prior year and provides the ability for the company to remain adequately, well-funded as and when needed, as mentioned earlier.
I [00:04:00] understand there are frustrated shareholders at the moment, and this is always the case when the share price chart is unfavorable. I can’t reiterate enough how positive I’m feeling about where we are heading. I’d remind our shareholders of our recent news flow surrounding the results of the MagSense HER2 breast cancer study, and the organizational push towards filing an IND.
Most drugs and many new devices fail before even getting into the clinic, and the company has to pivot to an alternate business strategy.
We, on the other hand, have positive human data [00:04:30] and are heading towards a recognized milestone, the IND. And that’s for our first product for the detection of nodal disease, and we have other imaging agents following closely behind.
We are unfortunately in a period where, in my opinion, our share price doesn’t reflect the current or potential value of the company. But I promise you we will continue to push through because we know that changing the way we look at cancer, will be of value to both patients and our shareholders. And I look forward to our AGM in a couple of weeks. [00:05:00]