Roots Sustainable Agricultural Technologies Ltd
Appendix 4E
Preliminary final report
1. Company details
Name of entity:
ARBN:
Reporting period:
Previous period:
Roots Sustainable Agricultural Technologies Ltd
619 754 540
For the year ended 31 December 2018
For the year ended 31 December 2017
2. Results for announcement to the market
Revenues from ordinary activities
up
100%
305
-
Loss from ordinary activities after tax attributable to the owners of Roots
Sustainable Agricultural Technologies Ltd
down
41%
2,884
4,883
Loss for the year attributable to the owners of Roots Sustainable
Agricultural Technologies Ltd
down
41%
2,884
4,883
31-Dec-18
US$’000
31-Dec-17
US$’000
Dividends
Not applicable.
Franked
Amount per
security
Cents
amount per
security
Cents
Additional Appendix 4E disclosure requirements can be found in the notes to the Roots Sustainable Agricultural Technologies
Ltd’s financial statements.
3. Net tangible assets
Net tangible assets per ordinary security
4. Control gained over entities
Not applicable.
5. Loss of control over entities
Not applicable.
Reporting
Previous
period
period
U.S. dollars U.S. dollars
0.0019
0.0492
For personal use only
Roots Sustainable Agricultural Technologies Ltd
Appendix 4E
Preliminary final report
6. Details of associates and joint venture entities
Name of associate / joint venture
Not applicable.
7. Audit qualification or review
Reporting entity's
percentage holding
Contribution to profit/(loss)
Reporting
Previous
Reporting
Previous
period
%
period
%
period
$'000
period
$'000
The financial statements have been audited and an unqualified opinion has been issued. The audit report is included in the
attached financial statements.
8. Attachments
The Annual Report of Roots Sustainable Agricultural Technologies Ltd for the year ended 31 December 2018 is attached.
9. Signed
Signed
Sharon Devir
Director
Beit Halevi
Date: 28 February 2019
For personal use only
Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Annual Report – 31 December 2018
For personal use only
Roots Sustainable Agricultural Technologies Ltd
Corporate Directory
31 December 2018
Directors
Sharon Devir (Executive Chairman and CEO)
Boaz Wachtel (Executive Director)
Adam Blumenthal (Non-Executive Director)
Graeme Smith (Non-Executive Director)
Dafna Shalev-Flamm (Non-Executive Director)
Company secretary
Sarah Smith
Registered office
C/- Mirador Corporate Pty Ltd
Suite 2, 1 Altona Street
West Perth WA 6005
Telephone: +61 8 6559 1792
Principal place of business
Hamezach 1 Str.
Kefar Vitkin Israel
Share registry
Auditor
Solicitors
Bankers
Automic Share Registry
Level 2, 267 St Georges Terrace
Perth WA 6000
Telephone: 1300 288 664
BDO - Tel Aviv
Amot Bituach House Bldg.
B 48 Derech Menachem Begin Rd
Tel Aviv Israel
Australian Legal Advisor
Steinepreis Paganin
Level 4, The Read Buildings
16 Milligan Street
Perth WA 6000
Israeli Legal Advisor
GKH Law Offices
One Azrieli Center
Round Building
Menachem Begin St.
Tel Aviv 6701101 Israel
Bank Hapoalim Ltd.
Branch 407
Hatidhar St. 16
Raanana IA 43100 Israel
Westpac Banking Corporation
Level 4, Brookfield Place, Tower Two
123 St Georges Tce
Perth WA 6000
ASX Code (Shares)
ROO
Website
www.rootssat.com
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Roots Sustainable Agricultural Technologies Ltd
Directors' Report
31 December 2018
The Directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as
the 'consolidated entity') consisting of Roots Sustainable Agricultural Technologies Ltd (referred to hereafter as the
'Company' or 'parent entity') and the entities it controlled at the end of, or during, the year ended 31 December 2018.
Directors
The following persons were directors of Roots Sustainable Agricultural Technologies Ltd during the whole of the financial
year and up to the date of this report, unless otherwise stated:
Sharon Devir (appointed on 19 April 2009)
Boaz Wachtel (appointed on 19 April 2009)
Adam Blumenthal (appointed on 9 November 2017)
Graeme Smith (appointed on 9 November 2017)
Dafna Shalev-Flamm (appointed 29 May 2018)
Tal Misch Vered (appointed on 9 November 2017, resigned 29 May 2018)
Principal activities
The principal activity of the Group during the year was the sale of root zone heating and cooling systems to greenhouse
farmers and the development of irrigation systems with combined fertilization and heating/cooling roots zone management.
Review of operations
Roots Sustainable Agricultural Technologies Ltd is an agricultural technology company focused on developing, producing
and commercializing precision agriculture technologies that help:
Improve crop yields;
• Plants address difficult weather conditions via root zone heating and cooling;
•
• Energy saving;
•
• Provide water from humidity, combined with roots cooling, in order to improve crop yield for irrigation purposes, in a
Improve fertilization methods by the cooling and heating of roots; and
cost effective and environmentally sustainable manner.
The highlights for the current financial year include:
Technical
• Showcasing world-first off-grid, solar and wind-operated Irrigation by Condensation (IBC) installation on beans and
alfalfa at key international agriculture conference Agri-Tech Israel 2018;
• Successful hydroponic nutrient-temperature controlled greenhouse installation using RZTO, in partnership with
Teshuva Agricultural Projects (TAP), where plant roots remained within favourable growing ranges more than 11
degrees lower than the ambient air temperature of nearly 40 degrees;
strains of heated medical cannabis;
• Excellent RZTO proof of concept results showing a 40 to 272 percent increase in average plant wet weight of eight
•
• RZTO cooling increasing lettuce growth in greenhouse of more than 130% and nearly halving growing time;
• Cooling chives roots using RZTO during Israeli summer to increase yield by more than 250%;
• Completing world-first pilot in a commercial operation combining RZTO and Nutrient Film Techniques (NFT);
•
• Conducting a successful winter pilot on basil increasing yield by 66%; and
• Entering the floriculture sector with successful RZTO cooling on Alstroemeria (Peruvian Lily).
• Opened new demonstration research and development hub in Hasahron Area, Central Israel to allow faster
;
commercialization of agtech solutions and innovation;
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Roots Sustainable Agricultural Technologies Ltd
Directors' Report
31 December 2018
Marketing and Sales
• Entry into China with exclusive distribution agreement with Dagan, conditional on $US19 million in ongoing sales
over five years;
• First China sales with significant US$257,000 contract for RZTO;
• First RZTO commercial sale in Israel for medical cannabis;
•
• First RZTO commercial sale in Israel for basil
• Entry and first RZTO sale in South Korea through agreement with Korean agricultural production and distribution
Israeli Government approval of up to 30% subsidy for basil growers using RZTO, following successful basil pilot;
company.
• Signed non-excusive Australian distribution agreement for RZTO and pilot demo program
• Signed Letter of Intent with Teshuva Agricultural Projects (TAP) for global collaboration on hydroponic greenhouses
using NFT and RZTO systems.
IP
• Granting of Australian patent for RZTO.
• Divisional patent granted in India for irrigation by condensation (IBC) technology
• Additional filing of IP in various territories in process
Corporate
• Formation of Scientific Advisory Board comprising Professor Raoul Bino, Professor Haim Rabinowitch and Professor
Uzi Kafkafi, academic leaders in agriculture from Holland and Israel.
• Appointed Dave Sharma, former Australia Ambassador to Israel, to assist with the development of international
contracts world-wide.
Dividends
There were no dividends paid or recommended during the financial year ended 31 December 2018 (2017: Nil).
Significant changes in the state of affairs
There were no other significant changes in the state of affairs of the consolidated entity during the financial year.
Matters subsequent to the end of the financial year
In February 2019, the Company announced its intention to complete a non-renounceable entitlement issue of one (1) Option
for every two (2) CDIs held by eligible CDI Holders registered at the Record Date at an issue price of $0.04 per Option.
In February 2019, the Company has received a financing commitment by way of execution of a convertible securities
agreement with CST Capital (hereafter: the Investor), in which the Company borrowed a total amount of up to AUD 1.62
million ($1,212 thousand) via the issue of convertible notes (hereafter: the Notes). The Notes will be issued in two tranches
with a face value of AU$1.00 per Note (Face Value), with 1,650,000 collateral CDIs over fully paid ordinary shares (CDIs) to
be issued to the Investor prior to the first purchase of 900,000 Notes. The first tranche is for an amount of AU$0.81 million.
A subsequent tranche of up to AU$0.81 million will be issued at a later date subject to mutual consent between Roots and
the Investor. The Notes will be interest-free and convertible.
The Notes can initially be converted at 130% of the 5-day VWAP prior to issuance of the applicable tranche. From 65 days
following the date of issue, the Notes can be converted at the lower of 130% of the 5-day VWAP prior to issuance of the
applicable tranche and 90% of the lowest daily VWAP during the 15 trading days preceding the conversion date. Other than
with the prior written consent of the Company, in any calendar month, upon issuance of a tranche, the Investor will receive
options equal to the face value, multiplied by 0.2, divided by the closing VWAP prior to issuance. The options will be
exercisable for 18 months and have an exercise price equal to 160% of the 5-day VWAP prior to issuance of the options.
On 19 February 2019, the Company issued 1,935,484 Unlisted Options (exercisable at $0.14 on or before 19 August 2020)
being the Options relating to the first tranche of Notes.
Likely developments and expected results of operations
The company will work to expand its commercial activity internationally. An emphasis will be on the Cannabis sector.
3
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Pinnacle Listed Practical Limited
Directors' report
31 December 2018
Information on Directors
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Former directorships (last 3 years): Nil
Special responsibilities:
Interests in shares:
Interests in options:
Contractual rights to shares:
Name:
Title:
Qualifications:
Experience and expertise:
Mr Sharon Devir
Executive Director/CEO
BSc, MSc, PHD
Dr Devir is a Co-Founder and Chief Executive Officer of Roots. He previously
cofounded Salicrop, an abiotic stress seed treatment technology as well as Rimonim,
an Agri-Tech fund. Dr Devir was the former Chief Executive Officer of NGT, a
technology incubator which sold a company Flourinex to Colgate for US$100 million.
He was also the Former Chief Scientific Officer of AFIMILK dairy management systems
and he has lectured at The Hebrew University, Israel on behalf of the Agriculture
Faculty. Dr Devir’s achievements led to being awarded the “Man of the Year” award by
Israeli TV Channel 2 and the Daily “Yediot Acharonot” newspaper for his Unique Social
Contribution.
– Salicrop, SkyX, Rimonim Agro Management
Chairman, CEO
2,931,564 CDI’s (subject to escrow until 6 December 2019)
28,000 CDI’s
430,490 Options
2,000,000 Performance Rights
Mr Boaz Wachtel
Co-Founder, R&D and Business Development, Executive Director
Masters in Management and Marketing
Mr. Wachtel is the Co-Founder and Executive Director of Roots. Mr. Wachtel is the
inventor of irrigation by condensation (NASA Tech Brief magazine- Technologies
of the Month) and root zone heating and cooling - ROOTS's core technologies. He has
published 25 publications focussing on water and he is a frequent lecturer on
agricultural technology, Middle East water issues and sustainability. He is a former
assistant army attaché to the Israeli Embassy in Washington DC and has lectured at
the UN conflict resolution conference. Mr Wachtel holds a Masters in Management and
Marketing from the University of Maryland.
Creso Pharma Limited
Other current directorships:
Former directorships (last 3 years): MMJ Phytotech (resigned August 2015)
Special responsibilities:
Interests in shares:
Business Development
5,298,777 CDI’s (subject to escrow until 6 December 2019)
78,000 CDI’s
850,510 Options
1,000,000 Performance Rights (subject to escrow until 6 December 2019)
Interests in options:
Contractual rights to shares:
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Roots Sustainable Agricultural Technologies Ltd
Directors' Report
31 December 2018
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Mr Adam Blumenthal
Non-Executive Director
Bachelor of Commerce, a Masters of International
Relations and a Masters of Business Administration
Mr Blumenthal has 10 years' experience in investment banking and corporate finance.
He has deep exposure to Australian and international markets, having provided capital
raising and financing solutions to an extensive number of unlisted and listed
companies. Mr Blumenthal has played a lead role in advising and supporting multiple
organisations across a broad spectrum of industries. Using his experience and
extensive network of international contacts to provide corporate advisory and capital
markets input, he has successfully brought to market several companies and is actively
involved in mining, cyber security, agricultural technology, medicinal cannabis,
pharmaceutical and information technology sectors. Mr Blumenthal is a shareholder of
EverBlu, the Lead Manager to the Offer and, on 23 August 2017, was appointed as the
Chairman on EverBlu.
Creso Pharma Limited
Burrabulla Corporation Limited
Former directorships (last 3 years): MOV Corporation Limited (resigned December 2014)
Interests in shares:
966,667 CDI’s (subject to escrow until 6 December 2019)
354,632 CDI’s
Nil
1,783,333 Performance Rights (subject to escrow until 6 December 2019)
Interests in options:
Contractual rights to shares:
Name:
Title:
Qualifications:
Experience and expertise:
Mr Graeme Smith
Independent Director and Non-Executive Director
Certified Practicing Agriculturist (CPAG)
Mr Smith is a Melbourne-based, world agriculture and horticulture expert, consultant
and lecturer. Mr Smith is a Certified Practicing Agriculturist (CPAG), from the Australian
Institute Agricultural Science and Technology. Graeme Smith Consulting has
(beginning with Hydroponic Designs Pty Ltd), delivered over 40 protected cropping
projects around Australia since 1995. These projects have largely delivered modern
greenhouse food production systems ranging from 400m2 to 160,000m2 in poly tunnels
through to modern glasshouses. Most of Mr Smith's food production projects involved
full return on, system design, costings, project management, as well as commissioning
and ongoing crop advisory services.
Other current directorships:
Nil
Former directorships (last 3 years): Nil
Nil
Interests in shares:
Nil
Interests in options:
Nil
Contractual rights to shares:
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Roots Sustainable Agricultural Technologies Ltd
Directors' Report
31 December 2018
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Ms Dafna Shalev-Flamm (appointed 29 May 2018)
Independent Director and Non-Executive Director
Certified Public Accountant, MBA
Ms Shalev-Flamm was an experienced Chief Financial Officer and Director with
extensive experience in operational management, accounting and finance, capital
management and corporate governance.
Plasson Industries Ltd
MTI Computers
Software Services Ltd
Former directorships (last 3 years): Poliram Ltd
Special responsibilities:
Interests in shares:
Interests in options:
Contractual rights to shares:
Chair of the Audit and remuneration committees
Nil
Nil
Nil
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Ms Tal Misch Vered (resigned 29 May 2018)
Independent Director and Non-Executive Director
Certified Public Accountant, BA, MSc.
Ms Misch Vered is a Certified Public Accountant since 1994. She is currently a board
member of four Israeli public companies and an institutional investor as follows:
Telsys Ltd. (Chairperson of the financial statements and the compensation
committee), Medipower (Overseas) Public (Chairperson of the financial statements
committee and the compensation committee), Opal Balance Investments, Ltd.
the compensation
(Chairperson of
committee), and Mordechai Aviv, Keren Hishtalmut le Ovdei Medina (Chairperson of
the audit committee).
Telsys Ltd, Medipower (Overseas) Public, Opal Balance Investments, Ltd.
Mordechai Aviv, Keren Hishtalmut le Ovdei Medina
financial statements committee and
the
Former directorships (last 3 years): Nil
Special responsibilities:
Interests in shares:
Interests in options:
Contractual rights to shares:
Chair of the Audit and remuneration committees (resigned 29 May 2018)
Nil
Nil
Nil
Company secretary
Ms Sarah Smith
Ms Smith specialises in corporate advisory, company secretarial and financial management services. Ms Smith’s experience
includes company secretarial and financial management services for ASX listed companies, capital raisings and IPOs, due
diligence reviews and ASX and ASIC compliance. Ms Smith is a Chartered Accountant and has acted as the Company
Secretary for a number of ASX listed companies.
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Roots Sustainable Agricultural Technologies Ltd
Directors' Report
31 December 2018
Meetings of directors
The number of meetings of the company's Board of Directors ('the Board') and of each Board committee held during the year
ended 31 December 2018, and the number of meetings attended by each director were:
Directors’ Meetings
Held
Attended
Audit Committee
Meetings
Attended
Held
Remuneration
Committee Meetings
Held
Attended
Sharon Devir
Boaz Wachtel
Adam Blumenthal
Graeme Smith
Dafna Shalev-Flamm (i)
Tal Misch Vered (ii)
6
5
6
6
2
4
6
6
6
6
2
4
-
-
1
2
1
1
-
-
2
2
1
1
1
1
1
1
-
1
1
1
1
1
-
1
(i)
(ii)
Dafna Shalev-Flamm was appointed as a Non-Executive Director on 29 May 2018.
Tal Misch Vered resigned as a Director on 29 May 2018.
Shares under option
At the date of this report, the unissued ordinary shares under option are as follows:
Grant date
Expiry date
Exercise price
Number under
option
29 November 2017
19 February 2019
30 November 2022
19 August 2020
AUD $0.01
AUD $0.14
1,655,000
1,935,484
No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of the
company or of any other body corporate.
At the date of this report, the number of performance rights on issue was as follows:
Grant date
29 November 2017
29 November 2017
19 June 2018
Class
Class A
Class C
Class D
Class
Class A Performance Rights
Class C Performance Rights
Class D Performance Rights
Expiry date
29 November 2020
29 November 2020
19 June 2023
Number of rights
issued
2,966,666
2,966,667
200,000
6,133,332
Milestone
The 12-month anniversary of the Company having been admitted to the Official List of
ASX.
The Company total sales, calculated from the date that the Company is admitted to
the Official List, exceeding AU$500,000.
66,666 Performance Rights will vest upon completion of 12 months of continuous
service to the Company;
66,667 Performance Rights will vest upon the Consultant introducing a new
opportunity, investor or client for the benefit of the Company as determined by the
CEO; and
66,667 Performance Rights will vest upon completion of 24 months continuous service
to the Company.
The performance rights will vest and become capable of exercise into ordinary shares in the Company upon the satisfaction
of vesting conditions as disclosed above.
Shares issued on the exercise of options
At the date of this report, no shares were issued on the exercise of options.
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Roots Sustainable Agricultural Technologies Ltd
Directors' Report
31 December 2018
Indemnifying Officers
The Company indemnifies each of its Directors and Officers. The Company indemnifies each Director or Officer to the
maximum extent permitted by the Israeli Companies Law, 5759-1999 from liability to third parties, except where the liability
arises out of conduct involving lack of good faith, and in defending legal and administrative proceedings and applications for
such proceedings.
The Company must use its best endeavours to insure a Director or Officer against any liability, which does not arise out of
conduct constituting a willful breach of duty or a contravention of the Israeli Companies Law, 5759-1999. The Company must
also use its best endeavours to insure a Director or Officer against liability for costs and expenses incurred in defending
proceedings whether civil or criminal.
Insurance Premiums
During the year, the Company paid insurance premiums to insure Directors and Officers against certain liabilities arising out
of their conduct while acting as an officer of the Group. Under the terms and conditions of the insurance contract, the nature
of the liabilities insured against and the premium paid cannot be disclosed.
Indemnity and insurance of auditor
The company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the
company or any related entity against a liability incurred by the auditor.
During the financial year, the company has not paid a premium in respect of a contract to insure the auditor of the company
or any related entity.
Proceedings on behalf of the company
No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to
which the Company is a party for the purpose of taking responsibility on behalf of the company for all or any part of those
proceedings.
Non-audit services
During the year, BDO Israel, the Company’s auditor, did not provide any services other than their statutory audits.
In the event that non-audit services are provided by BDO Israel, the Board has established certain procedures to ensure
that the provision of non-audit services are compatible with, and not compromise the auditor independence. These
procedures include:
●
●
all non-audit services will be subject to the corporate governance procedures adopted by the Company and will be
reviewed by the Board to ensure they do not impact the integrity and objectivity of the auditor; and
ensuring non-audit services do not involve reviewing or auditing the auditor’s own work, acting in a management or
decision-making capacity for the Company, acting as an advocate for the Company or jointly sharing risks and rewards.
Corporations Act 2001
As a foreign company registered in Australia, the Company will not be subject to Chapters 6A, 6B and 6C of the Corporations
Act dealing with the acquisition of shares (e.g. substantial holders and takeovers).
Under the Israeli Companies Law there are restrictions on acquisition of shares, requiring a tender offer for acquisition of
public Company shares resulting in a holding of 25% or more voting rights of the Company. In addition, under the Companies
Law, a person may not purchase shares of a public company if, following the purchase of shares, the purchaser would hold
more than 90% of the company’s shares, unless the purchaser makes a tender offer to purchase all of the target company’s
shares. Otherwise, the acquisition of the company’s securities generally not restricted by the company’s articles of
association or the laws of Israel, except that Israeli law prohibits the ownership of securities by nationals of certain countries
that are, or have been, in a state of war with Israel.
Environmental Regulations
In the normal course of business, there are no environmental regulations or requirements that the Company is subject to.
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Roots Sustainable Agricultural Technologies Ltd
Directors' Report
31 December 2018
This report is made in accordance with a resolution of directors.
On behalf of the directors
Sharon Devir
Director
28 February 2019
Beit-Halevi
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For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Financial Report – December 31, 2018
For personal use only Roots Sustainable Agricultural Technologies Ltd
December 31, 2018
TABLE OF CONTENTS
Independent Auditors’ Report
Statements of Financial Position
Statements of Comprehensive Loss
Statements of Changes in Equity
Statements of Cash flows
Notes to the Financial Statements
Page
1-4
5-6
7
8-9
10
11-33
All amounts are stated in U.S. dollars ($)
For personal use only For personal use only For personal use only For personal use only For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Statements of Financial Position
ASSETS
Current Assets
Cash and cash equivalents
Restricted cash
Trade receivables
Other accounts receivables
Total Current Assets
Non-Current Assets
Property and equipment
Total Non-Current Assets
As at December 31,
2017
2018
$’000
$’000
Note
7.B
4
593
35
115
154
897
78
78
3,544
23
-
39
3,606
45
45
TOTAL ASSETS
975
3,651
The accompanying notes are an integral part of the financial statements.
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ARBN 619 754 540
Statements of Comprehensive loss
Revenues
Cost of revenues
Gross profit
Share based compensation
Listing fee expenses
Research and development expenses, net
Marketing, distribution and business development expenses
General and administrative expenses
Loss from operations
Finance expense
Finance income
Loss before income tax
Income tax
Net loss
Other comprehensive loss
Items that will not be reclassified to profit or loss:
Translation adjustment to the presentation currency
Total comprehensive loss
Note
11
9
12
13
14
15
15
16
For the year ended
December 31,
2018
$’000
2017
$’000
305
268
37
110
31
849
967
819
2,737
147
-
2,884
-
2,884
-
-
-
2,548
641
222
-
156
3,567
1,412
96
4,883
-
4,883
108
2,992
17
4,900
Loss per share
Basic and diluted loss per share ($)
8,10
(0.046)
(0.253)
The accompanying notes are an integral part of the financial statements.
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ARBN 619 754 540
Statements of Changes in Equity
For the year ended December 31, 2018:
Foreign
Currency
Translation
Reserve
$’000
Share
Capital
$’000
Accumulated
Deficit
$’000
Total
Equity
$’000
Balance at January 1, 2018
9,457
(35)
(6,420)
3,002
Changes during the period:
Comprehensive loss:
Loss for the period
Other comprehensive loss:
Translation differences
Total comprehensive loss for the period
Stock based compensation
Balance as of December 31, 2018
-
-
-
110
9,567
-
(2,884)
(2,884)
(108)
(108)
-
(143)
-
(2,884)
-
(9,304)
(108)
(2,992)
110
120
The accompanying notes are an integral part of the financial statements.
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ARBN 619 754 540
Statements of Changes in Equity
For the year ended December 31, 2017:
Foreign
Currency
Translation
Reserve
$’000
Share
Capital
$’000
Accumulated
Deficit
$’000
Total
Equity
$’000
Balance at January 1, 2017
1,078
(18)
(1,537)
(477)
Changes during the period:
Comprehensive loss:
Loss for the period
Other comprehensive loss:
Translation differences
Total comprehensive loss for the period
Issuance of shares upon IPO, net
Issuance of benefit shares
Stock based compensation
Conversion of convertible loan to shares
Balance as of December 31, 2017
-
-
-
3,292
-
2,810
2,277
9,457
-
(4,883)
(4,883)
(17)
(17)
-
(4,883)
-
-
-
-
-
-
-
-
(35)
(6,420)
(17)
(4,900)
3,292
-
2,810
2,277
3,002
The accompanying notes are an integral part of the financial statements.
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ARBN 619 754 540
Statements of Cash Flows
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss for the year
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation
Share-based compensation expenses
Share-based compensation included in listing fee expenses
Loss from changes in fair value of embedded derivative
Change in liability for grants received from the IIA
Interest on liability for grants received from the IIA
Increase in trade receivable
Increase in other accounts receivable
Increase (decrease) in trade payable
Increase in other accounts payable
Net cash used in operating activities
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment
Change in restricted cash
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of liabilities on grants received from IIA
Receipt of grants from the IIA
Receipt of convertible loan
Net Proceeds from issuance of shares upon IPO
Net cash provided by financing activities
Translation differences on cash and cash equivalents
Increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the year
Cash and cash equivalents at the end of the year
For the year ended
December 31,
2018
$’000
2017
$’000
(2,884)
(4,883)
10
110
-
-
-
105
(117)
(126)
(63)
215
(2,750)
(48)
(14)
(62)
(6)
-
-
-
(6)
(133)
(2,818)
3,544
593
3
2,548
262
1,362
(287)
-
-
(27)
87
123
(812)
(45)
(11)
(56)
-
62
900
3,292
4,254
56
3,386
102
3,544
The accompanying notes are an integral part of the financial statements.
-10-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 1 - GENERAL:
A. Roots Sustainable Agricultural Technologies Ltd (the "Company") was incorporated in Israel on 20 April
2009 but commenced its operations in November 2012. The Company is listed, and its shares are publicly
traded on the Australian Securities Exchange (“ASX”).
Roots is an agriculture technology company focused on developing, producing and commercializing
precision agriculture technologies that address difficult weather conditions, improve crop yields and
provide water for irrigation in a cost effective and environmentally sustainable manner.
The formal address of the Company is Hamezach 1 Str. Kefar Vitkin, Israel.
B. The company is in its commercialization stage and does not generate significant revenue in this stage and
financed its operation up to date mainly by issuance of shares. As of December 31, 2018 the Company has
incurred negative cash from operation and net losses of USD 2,884 thousand for the current year. As a
result of these matters, there is a material uncertainty that may cast significant doubt on the entity's ability
to continue as a going concern. The financial report does not include adjustments relating to the
recoverability or classification of the recorded assets nor to the amounts or classification of liabilities that
might be necessary should the company not be able to continue as a going concern.
The directors believe that the company will be able to pay its debts when they fall due, and to fund near
term anticipated activities based on receipt from a convertible note agreement (see Note 20B) in addition
to revenues backlog. The Directors are satisfied that it is appropriate to prepare the financial statements on
a going concern basis on the basis that the above can be reasonably expected to be accomplished.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES:
The following accounting policies have been applied consistently in the financial statements for all periods
presented, unless otherwise stated.
A. Basis of preparation:
The principal accounting policies adopted in the preparation of the financial statements are set out below.
The policies have been consistently applied to all the years presented, unless otherwise stated.
These financial statements have been prepared in accordance with International Financial Reporting
Standards (IFRS). The financial statements have been prepared under the historical cost convention, except
for the embedded derivative that is measured at fair value through profit or loss.
B. Estimates and assumptions:
The preparation of the financial statements requires management to make estimates and assumptions that
have an effect on the application of the accounting policies and on the reported amounts of assets,
liabilities, revenue and expenses. These estimates and underlying assumptions are reviewed regularly.
Changes in accounting estimates are reported in the period of the change in estimate.
The key assumptions made in the financial statements concerning uncertainties at the end of the reporting
period and the critical estimates used by the Company that may result in a material adjustment to the
carrying amounts of assets and liabilities within the next financial year are discussed in Note 3.
-11-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONT.):
C. Functional and reporting currency:
The majority of the Company's costs are incurred in New Israeli Shekel (hereafter "NIS"). Thus, the
functional currency of the Company is NIS.
The financial statements are presented in United States Dollars, which provides relevant information for
the majority of investors and users of the financial statements. All values are rounded to the nearest dollar
unless otherwise stated.
Assets and liabilities are translated at the closing rate at each reporting date. Profit or loss items are
translated at average exchange rates for all periods presented. The resulting translation differences are
recognized in other comprehensive loss.
D. Foreign currency transactions:
Transactions denominated in foreign currency (other than the functional currency) are recognized on initial
recognition at the exchange rate as of the date of the transaction. After initial recognition, monetary assets
and liabilities denominated in foreign currency are translated at the end of each reporting period into the
functional currency at the exchange rate as of that date. Exchange differences are recognized in profit or
loss. Non-monetary assets and liabilities measured at cost are translated at the exchange rate as of the date
of the transaction.
E. Governmental liabilities on grants received:
Grants received from the IIA for Israel Innovation Authority (henceforth "IIA") as support for a research
and development projects include an obligation to pay back royalties conditional on future sales arising
from the project. Grants received from the IIA are accounted for as forgivable loans, accordingly, when
the liability for the loan is first recognized, it is measured at fair value using a discount rate that reflects a
market rate of interest. The difference between the amount of the grants received and the fair value of the
liability is accounted for upon recognition of the liability as a grant and recognized in profit or loss as a
reduction of research and development expenses. After initial recognition, the liability is measured at
amortized cost using the effective interest method. Changes in the projected cash flows are discounted
using the original effective interest and recognized in profit or loss. At the end of each reporting period,
the company evaluates, based on its best estimate of future sales, whether there is reasonable assurance
that the liability recognized, in whole or in part, will not be repaid. If there is such reasonable assurance,
the appropriate amount of the liability is derecognized and recognized in profit or loss as an adjustment of
research and development expenses. If the estimate of future sales indicates that there is no such reasonable
assurance, the appropriate amount of the liability that reflects expected future royalty payments is
recognized with a corresponding adjustment to research and development expenses.
-12-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONT.):
F. Cash equivalents:
Cash equivalents are considered by the Company to be highly-liquid investments, including, inter alia,
short-term deposits with banks and the maturity of which do not exceed three months at the time of deposit
and which are not restricted.
G. Restricted cash:
Restricted cash is considered by the Company to be deposits with banks which are used mainly as a security
for guarantees provided against payable payments in advance.
H. Deferred taxation:
Deferred tax asset or liability is recognized where the carrying amount of an asset or liability in the
statement of financial position differs from its tax base. Recognition of deferred tax asset is restricted to
those instances where it is probable that such difference can be utilized. As of December 31, 2018 and
2017, there is deferred tax assets since it is not probable that taxable profit will be available in the foreseen
future therefore no deferred tax assets recognized.
I.
Impairment of non-financial assets:
Other non-financial assets are subject to impairment tests whenever events or changes in circumstances
indicate that their carrying amount may not be recoverable. Where the carrying value of the non-financial
asset exceeds its recoverable amount (i.e. the higher of value in use and fair value less costs to dispose),
the asset is written down and impairment charge is recognized accordingly.
Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is
carried out on the asset's cash-generating unit (i.e. the smallest Company of assets to which the asset
belongs that generates cash inflow that are largely independent of cash inflows from other assets).
During the years 2018 and 2017 no impairment charges of non-financial assets were recognized.
J. Fair value measurement:
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.
The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the
liability takes place either:
1. In the principal market for the asset or liability, or
2. In the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible to by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would
use when pricing the asset or liability, assuming that market participants act in their economic best interest.
-13-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONT.):
A fair value measurement of a non-financial asset takes into account a market participant's ability to
generate economic benefits by using the asset in its highest and best use or by selling it to another market
participant that would use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient
data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing
the use of unobservable inputs.
Classification of fair value hierarchy
The financial instruments presented in the statement of financial position at fair value are grouped into
classes with similar characteristics using the following fair value hierarchy which is determined based on
the source of input used in measuring fair value:
Level 1
- Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2
Level 3
-
-
Inputs other than quoted prices included within Level 1 that are observable either directly
or indirectly.
Inputs that are not based on observable market data (valuation techniques which use inputs
that are not based on observable market data).
K. Financial instruments:
The accounting policy applied until December 31, 2017 in regards of financial instruments is as follows:
1. Financial assets:
The Company classifies its financial assets depending on the purpose for which the asset was acquired.
The Company's accounting policy for each category is as follows:
Loans and receivables: Loans and receivables are investments with fixed or determinable payments that
are not quoted in an active market and they are initially recognized at fair value plus directly attributable
transaction costs. After initial recognition, loans are measured based on their terms at amortized cost plus
directly attributable transaction costs using the effective interest method and less any impairment losses.
2.
Impairment of financial assets:
The Company assesses at the end of each reporting period whether there is any objective evidence of
impairment of a financial asset as follows. Financial assets carried at amortized cost:
There is objective evidence of impairment of loans and receivables if one or more events have occurred
after the initial recognition of the asset and that loss event has an impact on the estimated future cash flows.
Evidence of impairment may include indications that the debtor is experiencing financial difficulties,
including liquidity difficulty and default in interest or principal payments. The amount of the loss
recognized in profit or loss is measured as the difference between the asset's carrying amount and the
present value of estimated future cash flows (excluding future credit losses that have not yet been incurred)
discounted at the financial asset's original effective interest rate (the effective interest rate at initial
recognition). If the financial asset has a variable interest rate, the discount rate is the current effective
interest rate. The carrying amount of the asset is reduced through the use of an allowance account.
-14-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONT.):
In a subsequent period, the amount of the impairment loss is reversed if the recovery of the asset can be
related objectively to an event occurring after the impairment was recognized. The amount of the reversal
recognized in profit or loss.
3. Financial Liabilities:
The Company financial liabilities are mainly governmental liabilities, convertible loans, trade payables
and other accounts payable, the governmental grants measured at amortized cost using the effective interest
rate method. In 2017 the convertible loans are designated upon initial recognition as at fair value through
profit or loss, during 2017 the loan converted to shares.
The accounting policy applied as from January 01, 2018 in regards of financial instruments is as follows:
1. Financial assets:
The Company classifies its financial assets into one of two categories, depending on the purpose for which
the asset was acquired.
Amortized cost
These assets arise principally from the provision of goods and services to customers (eg trade receivables),
but also incorporate other types of financial assets where the objective is to hold these assets in order to
collect contractual cash flows and the contractual cash flows are solely payments of principal and interest.
They are initially recognized at fair value plus transaction costs that are directly attributable to their
acquisition or issue, and are subsequently carried at amortized cost using the effective interest rate method,
less provision for impairment.
2. Financial Liabilities:
The Company classifies its financial liabilities into one of two categories, depending on the purpose for
which the liability was acquired.
Amortized cost
These liabilities include Governmental liabilities on grants received, initially recognized at fair value plus
transaction costs that are directly attributable to the issue of the instrument, and are subsequently carried
at amortized cost using the effective interest rate method, less provision for impairment.
3. Derecognition:
Financial assets
The Company derecognizes a financial asset when the contractual rights to the cash flows from the
financial asset expire or it transfers the rights to receive the contractual cash flows.
Financial Liabilities
The Company derecognizes a financial liability when its contractual obligations are discharged or
Cancelled, or expire.
-15-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONT.):
L. Revenue from contracts with customers
Revenue from contracts with customers is recognized when control of the goods or services are transferred
to the customer at an amount that reflects the consideration to which the Company expects to be entitled
in exchange for those goods or services
Revenues from Construction Contracts
The Company recognizes income from construction contracts over time, since the Company's performance
creates an asset that the customer controls as the asset is created.
Revenues are recognize by the input methods.
Input methods recognize revenue on the basis of an entity’s efforts or inputs towards satisfying a
performance obligation (including resources consumed, labor hours expended, costs incurred, time
elapsed) relative to the total expected inputs to satisfy the performance obligation.
When a loss from a contract is anticipated, a provision is made in the period in which it first becomes
evident, for the entire loss anticipated, as assessed by the company's management.
The payment terms in the projects are based on milestones set at the date of signing the contract and are
based mainly on the rate of progress. For this reason, the Company is not expected to recognize assets in
respect of contracts and liabilities in respect of contracts in significant amounts in relation to these
contracts.
Financing components
The Company does not expect to have any contracts where the period between the transfer of the promised
goods or services to the customer and payment by the customer exceeds one year. As a consequence, the
Company does not adjust any of the transaction prices for the time value of money.
M. Assets and liabilities arising from contracts with customers
Contract assets
A contract asset is the Company's right to consideration in exchange for goods or services the entity has
transferred to a customer that is conditional on something other than the passage of time
Trade receivables
A receivable represents the Company's right to an amount of consideration that is unconditional (i.e., only
the passage of time is required before payment of the consideration is due).
-16-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONT.):
N. Property, plant and equipment:
Property and equipment are stated at cost, net of accumulated depreciation and net of impairment.
Depreciation is calculated by the straight-line method over the estimated useful lives of the assets at the
following rates:
Computer equipment
Machinery and equipment
Vehicles
O. Employee benefits:
%
33
7-20
15
1. Short-term employee benefits: Short-term employee benefits are benefits that are expected to be
settled wholly before twelve months after the end of the annual reporting period in which the
employees render the related services. These benefits include salaries, paid sick leave, recreation, and
social security contributions and are recognized as expenses as the services are rendered. A liability in
respect of a cash bonus or a profit-sharing plan is recognized when the Company has a legal or
constructive obligation to make such payment as a result of past service rendered by an employee and
a reliable estimate of the amount can be made.
2. Post-employment benefits: The plans are normally financed by contributions to insurance companies
and classified as defined contribution plans.
The Company has defined contribution plans pursuant to Section 14 to the Severance Pay Law under
which the Company pays fixed contributions to a specific fund and will have no legal or constructive
obligation to pay further contributions if the fund does not hold sufficient amounts to pay all employee
benefits relating to employee service in the current and prior periods.
Contributions to the defined contribution plan in respect of severance or retirement pay are recognized
as an expense simultaneously with receiving the employee's services and no additional provision is
required in the financial statements except for the unpaid contribution.
P. Operating Segment
The company currently conduct its operation through one operating segment.
Q. Share-based payments:
Where equity settled share options are awarded to employees, the fair value of the options calculated at
the grant date based on the share fair price is charged to the statement of comprehensive income over the
vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity
instruments expected to vest at each reporting date so that, ultimately, the cumulative amount recognized
Over the vesting period is based on the number of options that eventually vest. Market vesting conditions
are factored into the fair value of the options granted. As long as all other vesting conditions are satisfied,
-17-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONT.):
a charge is made irrespective of whether the market vesting conditions are satisfied. The cumulative
expense charged is not adjusted for failure to achieve a market vesting condition.
R. Research and Development:
Costs are expensed as incurred. Development expenditures on an individual project are recognized as an
intangible asset when the Company can demonstrate:
· The technical feasibility of completing the intangible asset so that the asset will be available for use or
sale
·
Its intention to complete and its ability and intention to use or sell the asset.
· How the asset will generate future economic benefits.
· The availability of resources to complete the asset.
· The ability to measure reliably the expenditure during development.
During the years 2018 and 2017 the company didn’t stand in the following criteria therefore all research
and development recognized as expenses.
S.
Issuance costs:
The company allocated the incremental costs that were directly attributable to issuing new shares to equity
(net of any income tax benefit) and the costs that were related to the stock market listing, or are otherwise
not incremental and directly attributable to issuing new shares, were recognized as an expense in the
statement of comprehensive income. Costs that were related to both share issuance and listing were
allocated between those functions based on the number of shares.
T. Earnings (loss) per share:
Earnings per share are calculated by dividing the net income (loss) attributable to equity holders of the
Company by the weighted number of Ordinary shares outstanding during the period.
Potential Ordinary shares are included in the computation of diluted earnings per share when their
conversion decreases earnings per share from continuing operations. Potential Ordinary shares that are
converted during the period are included in diluted earnings per share only until the conversion date and
from that date in basic earnings per share.
U. New IFRSs adopted in the period:
1.
IFRS 9 Financial Instruments
IFRS 9 Financial Instruments replaces IAS 39 Financial Instruments: Recognition and Measurement for
annual periods beginning on or after 1 January 2018, bringing together aspects of the accounting for
financial instruments: classification and measurement; impairment; and hedge accounting.
The Company has implemented the requirements of IFRS 9 retrospectively on the basis of the facts and
circumstances that existed as of January 1, 2018 by recognizing the cumulative effect of the retrospective
-18-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONT.):
application as an adjustment to the opening balance of retained earnings and other components of equity
as of January 1, 2018.
The adoption of IFRS 9 did not have an impact on the financial statements.
2.
IFRS 15 Revenue from Contracts with Customers
IFRS 15 supersedes IAS 11 Construction Contracts, IAS 18 Revenue and related Interpretations and it
applies to all revenue arising from contracts with customers, unless those contracts are in the scope of
other standards.
The Company elected to apply IFRS 15 retrospectively for the first time by recognizing the cumulative
effect of the retroactive application as an adjustment to the opening balance of retained earnings as at
January 1, 2018. The adoption of IFRS 15 did not have an impact on the financial statements.
NOTE 3 - CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS:
The areas requiring the use of estimates and critical judgments that may potentially have a significant impact
on the Company's earnings and financial position is Governmental liabilities on grants received.
Governmental liabilities on grants received
The Company measured governmental liabilities on grants received, each period, based on discounted cash
flows derived from Company's future anticipated revenues. The discount rate reflect the market rate.
NOTE 4 - OTHER ACCOUNTS RECEIVABLES:
Government institutions
Prepaid expenses
Other receivables
NOTE 5 - OTHER ACCOUNTS PAYABLES:
Employees and related institutions
Accrued expenses
Governmental liabilities on grants received (Note 7.C)
Liabilities to related parties
Other payables
-19-
As at December 31,
2018
$’000
2017
$’000
63
46
45
154
33
-
6
39
As at December 31,
2018
$’000
2017
$’000
121
99
39
90
49
398
72
48
10
3
34
167
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 6 - CONVERTIBLE LOAN:
On April 2017, the Company signed a convertible loan agreement (the "Agreement") with an investor
(hereafter: the Lender), in which the Company borrowed a total amount of AUD 1.2 million ($900 thousand).
The loan bears an annual interest of 3% starting October 2017.
According to the Agreement the loan will be mandatory converted to the Company’s ordinary shares In case
of an initial public offering ("IPO") at an exercise price of $0.06 (AUD 0.08). The Company designated upon
initial recognition that the convertible loan will be measured at fair value through profit or loss. Upon the IPO
that took place in December, 2017 the loan fair value amounted to $ 2,277 thousand was converted into
15,000,000 shares.
NOTE 7 - COMMITMENTS AND CONTINGENT LIABILITIES:
A. The Company leases premises for its offices and R&D center in Bet Halevi. The initial contract period
ended September 30, 2015. According to the lease agreement, the Company has an option to renew the
lease period for tree additional years at its discretion. The company chose to utilize this option.
Total rent expenses for the years ended December 31, 2018 and 2017 were 20 and 3 thousand U.S. dollars
respectively.
B. As of December 31, 2018 and 2017, the Company has a lien in first degree to the bank in amount of
approximately 35 and 23 thousands U.S. dollars, respectively on a bank deposit account and all cash and
securities deposited in them.
C. The Company participates in programs sponsored by the Israel Innovation Authority ("IIA"), for the
support of several research and development projects programs which subjected to royalties, while others
are not (the company is committed to pay royalties for the R&D programs, while the research programs
does not required repayment). In exchange for the IIA's participation in the programs, the Company is
required to pay royalties to the IIA at a rate of 3% of sales of developed products linked to U.S dollars,
until repayment of 100% of the amount of grants received, plus annual interest at the LIBOR rate.
The company is required to pay royalties, to the IIA, of sales to end customers of products developed with
funds provided by the IIA, if and when such sales are recognized. As of December 31, 2018 and 2017 the
Company has received grants amounted to 0 and 62 thousands U.S. dollars respectively, the aggregate
governmental liabilities was 433 and 362 thousands U.S. dollars, respectively. The exceptions of the
Company to pay the grants are based on its estimation at the end of the each year. As of December 31,
2018 the company paid royalty to the IIA amounted to 6 thousands U.S. dollars.
-20-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 7 - COMMITMENTS AND CONTINGENT LIABILITIES (CONT.):
Changes in liabilities arising from financing activities
Reconciliation of the changes in liabilities for which cash flows have been, or will be classified as financing
activities in the statement of cash flows:
At 1 January
Changes from financing cash flows
grants received from IIA
Repayment of liabilities on grants received from IIA
Total changes from financing cash flows
changes in fair value
Interest on liability
The effect of changes in foreign exchange rates
At 31 December
NOTE 8 - SHAREHOLDERS EQUITY:
Governmental liabilities on
grants received
2018
$’000
362
-
(6)
(6)
-
105
(28)
433
2017
$’000
539
62
-
62
(
)287
-
48
362
Ordinary shares of NIS 0.01 par value
Number of shares
December 31, 2018
December 31, 2017
Authorized
100,000,000
Issued and
outstanding
63,966,667
Authorized
100,000,000
Issued and
outstanding
61,000,000
A. The Ordinary Shares confer upon the holders thereof all rights accruing to a shareholder of the Company,
including, the right to receive notices of and to attend meetings of shareholders; for each share held, the
right to one vote at all meetings of shareholders; and to share equally, on a per share basis, in such dividend
and other distributions to shareholders of the Company as may be declared by the Board of Directors and
upon liquidation or dissolution of the Company, in the distribution of assets of the Company legally
available for distribution to shareholders in accordance with the terms of applicable law. All Ordinary
Shares rank pari-passu in all respects with each other.
B.
In January 1, 2016 the share capital consists of 217,682 ordinary shares of NIS 0.01 and during 2016, the
company has issued share capital as following:
· The company issued 10,464 ordinary shares of NIS 0.01 par value for four lenders and 4,532 ordinary
shares of NIS 0.01 par value for an employee. See also note 6.
· Two employees exercised 9,256 options into 9,256 ordinary shares of NIS 0.01 par value at a price of
NIS 0.01 per share. See also note 9.
· The company issued 14,335 ordinary shares of NIS 0.01 par value, for a total amount of 244 thousand
U.S. dollars.
-21-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 8 – SHAREHOLDERS EQUITY (CONT.):
C. On April 3, 2017, the company reconstruct the share capital of the Company by issuance of 14,743,731
Ordinary Shares as bonus shares to be pro-rata allocated to the holders of the Ordinary Shares of the
Company so that the holding ratio remain the same as previous to the reconstruction.
D. In December 2017, the Company's IPO took place, in which 25,000,000 shares issued at a price per share
of $0.15 (AUD 0.2). In addition, the Company issued as following:
·
·
·
Prior to admission 1,500,000 Bonus shares issued to all pre-offer shareholders on a pro-rata basis.
Prior to admission 15,000,000 shares issued according to its convertible loan agreement (See Note 6).
4,500,000 shares issued to seed capitalists at par value. The value of the transaction measured
according to the value of the shares granted duo to the lack of the ability to reliably measure the fair
value of the services rendered.
E. On May 17, 2018 the company converted 2,966,667 Performance Rights into Ordinary Shares. The
Performance Rights converted on the satisfaction of the following Milestone as per the IPO Prospectus
lodged with ASX on 6 December 2017: "Roots Share Price trading at not less than $0.40 for 5 consecutive
trading days”
NOTE 9 - SHARE BASED PAYMENT:
A. Options and shares granted to employees and service providers:
i. Prior to admission, some of the Director issued with a total of 1,281,000 options (‘Director Options’),
which are fully vested and have an exercise price of $0.01 exercisable to ordinary shares on 1:1 basis. The
Director Options were valued using the Black Scholes option valuation methodology. The company
recognized an expense at the amount of $ 326 thousand.
An additional 700,000 options will be granted to employees, executives and consultants 326,000 of these
options are not yet allocated and will be retained to be granted at a future date, with vesting conditions to
be determined. The remaining 374,000 options exercisable to ordinary shares on 1:1 basis were granted
subject to a range of vesting periods.
·
80,000 options vest upon completion of a technical milestones as follows: (i) 40,000 Options upon
completion of the system head and monitor system on or before May 1, 2018; (ii) 20,000 Options
upon completion of a commercial ground source heat exchanger and a set of agricultural smart
pipes field tests on or before November 1, 2018; and (iii) 20,000 Options upon completion of the
manufacturing of a smart pipe series, on or before 1 June 2019;
·
120,000 Options vest upon the following sales milestones: (i) 10,000, 20,000 and 10,000 Options
when the Company's Sales (including backlog) directly through JV exceed AUD 100,000, 250,000
and 500,000 Respectively, on or before March 31, 2019; and (ii) 80,000 Options when the
Company's Sales (including backlog) exceed AUD 2,000,000 (in the aggregate) on or before June
1, 2019.
-22-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 9 - SHARE BASED PAYMENT (CONT.):
·
174,000 Options shall vest on a time basis: (i) 32,000 Option following two years from the date of
the Company's admission to the ASX; (ii) 62,000 Options follow three years from the date of the
Company's admission to the ASX; and (iii) 80,000 Options following four years from the date of
the Company's admission to the ASX.
The options valued using the Black Scholes option valuation methodology based on the following data and
assumptions:
Share price - AUD 0.335 (representing approximately $0.26), Exercise price - AUD 0.01 (representing
approximately $0.078), Expected volatility - 70% ,Risk-free interest rate – 2.161% , and expected average
life of options 0.5 year
The total value of the options are $ 95 thousand and as of December 31, 2018 the company recognized an
expense at the amount of $ 56 thousand.
ii. Further to the above On July 01, 2018 the company granted 160,000 options from the unallocated options
to employees, executives and consultants in same conditions except the following:
Share price - AUD 0.285 (representing approximately $0.21), Exercise price - AUD 0.01 (representing
approximately $0.073), Risk-free interest rate – 2.01%, and expected average life of options 2 years.
The total value of the options are $ 34 thousand and as of December 31, 2018 the company recognized an
expense at the amount of $ 13 thousand.
Data related to the share option plan as of December 31, 2018 and changes during the two years ended on that
date are as follows:
Options outstanding as beginning of year
Changes during the year:
Granted
Forfeited
Exercised
Options outstanding at end of year (*)
Options exercisable at year-end
2018
2017
Number
of
Options
Weighted
Average
Exercise
Price
NIS
Number
of
Options
Weighted
Average
Exercise
Price
NIS
1,655,000
0.04
-
-
160,000
(36,000)
-
1,779,000
1,415,667
0.04 1,655,000
0.04
-
-
-
-
0.04 1,655,000
0.04 1,281,000
-
-
0.04
0.04
Weighted-average fair value of options Granted during
the year
$ 34,164
$ 421,000
* The options outstanding at 31 December 2018 had a weighted-average contractual life of 3.04 year.
-23-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 9 - SHARE BASED PAYMENT (CONT.):
B. Performance rights:
i.
Upon IPO, three classes of Performance Rights ("Rights") were approved by The Board and shareholders
at an Extraordinary General Meeting. The Rights are fully vested and convert to ordinary shares on 1:1
basis, when the attaching milestone is met:
2,966,667 Class A - upon the 12-month anniversary of the Company having been admitted to the official
list of ASX; (Milestone A). These performance rights have been valued at $754 thousand (AUD 994
thousand) based on the Company’s forecasts for milestone fulfilment, as the condition is not vesting
condition.
2,966,667 Class B - upon the Company’s share price being traded at not less than $0.40 for 5 consecutive
trading days; (Milestone B). These performance rights have been valued at $707 thousand (AUD 931
thousand) using the Monte Carlo simulation model.
2,966,666 Class C - the Company’s total sales, starting as of its first day of listing on the ASX, exceeds
500,000 Australian Dollars; (Milestone C). These performance rights have been valued at $754 thousand
(AUD 994 thousand) based on the Company’s forecasts for milestone fulfilment, as the condition is not
vesting condition.
The Class A and Class C Rights valued using the Black Scholes option valuation methodology, Class B
valued using the Monte Carlo simulation model based on the following data and assumptions:
Share price - AUD 0.335 (representing approximately $0.26), Expected volatility - 70%, Risk-free interest
rate – 1.9%, and expected average life of options 2 years. The total fair value of performance shares at the
amount of $ 2,215 thousand was expensed through profit and loss.
ii. On February 27, 2018 the company Issue of Performance Rights to unrelated Consultant. The Performance
Rights will convert into Ordinary Shares in three equal tranches on a 1:1 basis upon the satisfaction of
Performance Milestones as follows:
(cid:127) 66,667 Performance Rights will vest upon the completion of 12 months of continuous service to the
Company.
(cid:127) 66,667 Performance Rights will vest upon the Consultant introducing a new opportunity, investor or
client for the benefit of the Company as determined by the CEO and vest upon the completion of 24 months
continuous service to the Company.
(cid:127) 66,667 Performance Rights will vest upon the completion of 24 months continuous service to the
Company.
The Performance Rights valued using the Black Scholes option valuation methodology based on the
following data and assumptions:
Share price - AUD 0.48 (representing approximately $0.36), Expected volatility - 70%, Risk-free interest
rate – 1.9% and expected average life of options 1.67 years.
-24-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 9 - SHARE BASED PAYMENT (CONT.):
The total fair value of performance rights is 71 thousand (AUD 96 thousand), $41 thousand was expensed
through profit and loss during the period.
Data related to the Performance rights as of December 31, 2018 and changes during the two years ended on
that date are as follows:
Performance rights outstanding as beginning of year
Changes during the year:
Granted
Forfeited
Exercised
Performance rights outstanding at end of year (*)
Performance rights exercisable at year-end
Weighted-average fair value of Performance rights
Granted during the year
2018
2017
Weighted
Average
Exercise
Price
NIS
-
-
-
-
-
-
Weighted
Average
Exercise
Price
NIS
-
-
-
-
-
-
Number of
rights
-
8,900,000
-
-
8,900,000
-
Number of
rights
8,900,000
200,000
-
(2,966,667)
6,133,333
2,966,667
$ 71,000
$ 2,215,000
* The Performance rights outstanding at December 31, 2018 had a weighted-average contractual life of 0.07
year.
NOTE 10 - LOSS PER SHARE:
Net loss per share attributable to equity owners:
Net loss used in basic and diluted EPS
For the year ended
December 31,
2018
$’000
2017
$’000
2,
( 884
)
(4,883)
Weighted average number of shares used in basic and diluted EPS
62,853,151
19,311,813
Basic and diluted net EPS (dollars)
(0.046)
(0.253)
At 31 December 2018, 6,133,333 Performance Rights and 1,779,000 options (2017: 8,900,000 Performance
Rights and 1,655,000 options) were excluded from the diluted weighted-average number of ordinary shares
calculation because their effect would have been anti-dilutive.
-25-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 11 - REVENUE:
Primary Geographic Markets
China
Israel
Total
NOTE 12 - RESEARCH AND DEVELOPMENT EXPENSES, NET:
Salaries and benefits
Subcontractors
Materials
Legal fees
Participation in expense
Other
Governmental Grants received and changes in liability, net
Total
For the year ended
December 31,
2018
$’000
2017
$’000
258
47
305
-
-
-
For the year ended
December 31,
2018
$’000
2017
$’000
163
453
160
45
-
28
849
-
849
339
123
47
-
(5)
5
509
(287)
222
NOTE 13 - MARKETING, DISTRIBUTION AND BUSINESS DEVELOPMENT EXPENSES:
Public Relations
Marketing
Salaries and benefits
Business development
Other
Total
For the year ended
December 31,
2018
$’000
2017
$’000
319
259
189
141
59
967
-
-
-
-
-
-
-26-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 14 - GENERAL AND ADMINISTRATIVE EXPENSES:
Salaries and benefits
Consulting
Professional fees
Insurance
Rental and office expenses
Refreshments
Exhibitions
Other
Total
NOTE 15 - FINANCE EXPENSE AND INCOME:
Finance expense:
Change in convertible loan
Interest on governmental liabilities on grants received
Interest and bank charges
Net foreign exchange loss
Total finance expense
Finance income:
Net foreign exchange gain
Total finance income
-27-
For the year ended
December 31,
2018
$’000
2017
$’000
271
247
128
58
57
16
7
35
819
-
-
94
4
5
8
41
4
156
For the year ended
December 31,
2018
$’000
-
77
3
67
147
2017
$’000
1,367
45
-
-
1,412
For the year ended
December 31,
2018
$’000
-
-
2017
$’000
96
96
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 16 - TAXATION:
A.
Israeli tax rates:
Israeli corporate tax rates are 24% in 2017 and 23% in 2018.
The Law for the Amendment to the Income Tax Ordinance, New Version, 1961(hereafter – "the
Ordinance") (Amendment 216 to the Ordinance) (hereafter – "the amendment") was published in the
official gazette in January 2016; the said law stipulated the reduction of the rate of corporate tax from
26.5% to 25% commencing January 1, 2016. On December 2016, the Israeli government published the
Economic Efficiency Law (2016) (legislative amendments to accomplish budget goals for the years 2017
and 2018) According to which, in 2017 the tax rate will decrease by 1% and starting 2018 by 2%; so that
the tax rate will be 24% in 2017 and 23% in 2018 and onwards. Since the Company has carry forward
losses and there is no deferred tax assets or liability there is no impact of the tax rate change.
B. Net operating losses carry forward:
As of December 31, 2018, the Company has estimated carry forward tax losses of approximately 5,562
thousands U.S. dollars, which may be carried forward and offset against taxable income for an indefinite
period in the future. Deferred tax asset on the company's losses was not recognized since it is not probable
that taxable profit will be available in the foreseen future.
C. Reconciliation of effective tax rate:
The adjustments for the difference between the actual tax charge for the year and the standard rate of
corporation tax in Israel applied to profits for the year are as follows:
Loss before income tax
Tax computed at the corporate rate in Israel
losses for which no deferred tax asset is recognized
Total income tax expense
For the year ended
December 31,
2018
$'000
(2,884)
(663)
663
-
2017
$'000
(4,883)
(1,172)
1,172
-
-28-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 17 - FINANCIAL INSTRUMENTS AND RISK MANAGEMENT:
The Company is expose to variety of financial risks, which results from its financing, operating and investing
activities. The objective of financial risk management is to contain, where appropriate, exposures in these
financial risks to limit any negative impact on the Company's financial performance and position. The
Company's financial instruments are its cash, trade and other receivables, trade payables and other liabilities.
The main purpose of these financial instruments is to raise finance for the Company's operation. The Company
actively measures, monitors and manages its financial risk exposures by various functions pursuant to the
segregation of duties and principals. The risks arising from the Company's financial instruments are mainly
credit risk, currency risk and liquidity risk. The Company has no interest rate risk as the balances exposure to
interest is minimal. The risk management policies employed by the Company to manage these risks discussed
below.
A. Credit risk:
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or
customer contract, leading to a financial loss. The Group is exposed to credit risk from its operating
activities (primarily trade receivables) and from deposits with banks and financial institutions, foreign
exchange transactions and other financial instruments.
Trade receivables and contract assets
The Company believes that there is no material credit risk in light of Company's policy to assess the credit
risk instruments of customers before entering contracts. Credit quality of a customer is assessed based on
an extensive credit rating scorecard and individual credit limits are defined in accordance with this
assessment.
Cash and cash equivalents and deposits with banks
The Company holds cash and cash equivalents and deposit accounts in big banking institutions in Israel
and in the Australia, thereby substantially reducing the risk to suffer credit loss
B. Foreign currency risk:
Foreign exchange risk arises when the company enter into transactions denominated in a currency other
than its functional currency. The company is exposed to currency risk to the extent that there is a mismatch
between the currency in which it denominated and the respective functional currency of the company.
The currencies in which some transactions are primarily denominated are US dollars and Australian
dollars.
-29-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 17 - FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (CONT.):
The company's policy is not to enter into any currency hedging transactions. The carrying amounts of the
Company's foreign currency denominated monetary assets and monetary liabilities at the reporting date
are as follows:
Assets
Cash And cash equivalents
Trade receivables
Other accounts receivables
Liabilities
Trade and other payables
Governmental liabilities on grants received
Assets
Cash And cash equivalents
Liabilities
Trade and other payables
Governmental liabilities on grants received
Analysis:
As at December 31, 2018
US dollar
AUD
NIS
Total
132
85
26
243
147
433
580
455
-
-
455
78
-
78
6
30
2
38
76
-
76
593
115
28
736
301
433
734
As at December 31, 2017
US dollar
AUD
NIS
Total
83
83
41
362
403
3,446
3,446
101
-
101
15
15
71
-
71
3,544
3,544
213
362
575
A 5% strengthening of the NIS against the following currencies would have increased (decreased) equity
and the income statement by the amounts shown below. This analysis assumes that all other variables, in
particular interest rates, remain constant. For a 5% weakening of the NIS against the relevant currency,
there would be an equal and opposite impact on the profit and other equity.
2018
2017
Linked to US dollar
Linked to AUD
C. Liquidity risks:
)337(
5%
)17(
377
5%
19
)320(
5%
)16(
3,345
5%
167
Liquidity risk is the risk that arises when the maturity of assets and the maturity of liabilities do not match.
An unmatched position potentially enhances profitability but can also increase the risk of loss. The
Company has procedures with the object of minimizing such loss by maintaining sufficient cash and other
highly liquid current assets and by having available an adequate amount of committed credit facilities.
The Company has no material obligation beyond one year (the liabilities for governmental institutes
depends on achieving future revenues) and has a positive working capital and cash in bank to finance its
working capital in the near future.
-30-
For personal use only
Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 17 - FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (CONT.):
The following tables detail the Company's remaining contractual maturity for its financial liabilities. The
tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the
repayment forecast of the management of the company.
December 31, 2018:
Book
value
Less than
one year
1 to 2
years
Amortized cost
2 to 3
years
3 to 4
years
U.S. dollars in thousands
> 5
years
Total
Trade and other accounts
payables
Governmental liabilities
on grants received
Total
December 31, 2017:
(301)
(433)
(734)
(301)
(44)
(345)
-
(89)
(89)
-
-
-
(301)
(178)
(178)
(266)
(266)
(230)
(230)
(807)
(1,108)
Book
value
Less than
one year
1 to 2
years
Amortized cost
2 to 3
years
3 to 4
years
U.S. dollars in thousands
> 5
years
Total
Trade and other accounts
payables
Governmental liabilities
on grants received
Total
(213)
(362)
(575)
(213)
(11)
(224)
-
(44)
(44)
-
(89)
(89)
-
-
(177)
(177)
(518)
(518)
(213)
(839)
(1,052)
D. Fair value of financial assets and liabilities:
The fair value of the Company's current financial assets and liabilities approximates their carrying amounts
as their maturity date is less than 1 year and they do not bear a fixed interest rate.
The fair value of governmental liabilities on grants received measured (for disclosure purposes only)
according to level 3.
Item
Governmental liabilities
on grants received
Fair
value
$’000
433
Valuation
technique
Fair value
hierarchy
level
Significant
unobservable
inputs
fair value using a
discount rate that
reflects a market
rate of interest
level 3
WACC
-31-
For personal use only
Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 17 - FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (CONT.):
Reconciliation of fair value measurements that are categorized within Level 3 of the fair value hierarchy:
Balance as of January 1
Convertible loan
Conversion of convertible loan to shares (transferred out to Level 1) *
Loss recognized in Profit or loss:
Balance as of December 31
2018
$’000
-
-
-
-
-
2017
$’000
-
900
(
2,277
)
1,377
-
* At the time of conversion, the shares had quoted fair value, therefore measured at Level 1
E. The Group's objectives when maintaining capital are:
The Company seeks to maintain a capital structure which enables it to continue as a going concern and
which supports its business strategy. The Company's capital is provided by equity rising. The Company
manages its capital structure through raising funds from shareholders. The Company has net cash and cash
equivalents at the balance sheet date of 593 (2017 – 3,132) thousands U.S. dollars, and a positive working
capital. Accordingly, the directors believe that the company will be able to pay its debts when they fall
due, and to fund near term anticipated activities based on receipt from a convertible note agreement (see
Note 20B) in addition to revenues backlog.
NOTE 18 - RELATED PARTY AND SHAERHOLDRS:
Related party transactions:
Compensation of key management personnel of the Company:
Short-term employee benefits *)
Share base payment
Other related party transactions:
Material costs
For the year ended
December 31,
2018
$’000
168
-
435
2017
$’000
105
1,856
-
*) Including Management fees for the CEO, Directors Executive Management and other related parties.
Balances with related parties:
Trade payables
As at December 31,
2017
2018
$’000
$’000
90
2
-32-
For personal use only Roots Sustainable Agricultural Technologies Ltd
ARBN 619 754 540
Notes to the Financial Statements
NOTE 19 - EMPLOYEE BENEFITS:
The Company has defined contribution plans pursuant to Section 14 to the Severance Pay Law under which
the Company pays fixed contributions to a specific fund and will have no legal or constructive obligation to
pay further contributions if the fund does not hold sufficient amounts to pay all employee benefits relating to
employee service in the current and prior periods.
Expenses in respect of defined contribution plans
Year ended December 31,
2018
$’000
2017
$’000
33
18
NOTE 20 - EVENTS AFTER THE REPORTING PERIOD:
A.
In February 2019, the Company announced its intention to complete a non-renounceable entitlement issue
of one (1) Option for every two (2) CDIs held by eligible CDI Holders registered at the Record Date at an
issue price of $0.04 per Option.
B. On February 2019, the Company has received a financing commitment by way of execution of a
convertible securities agreement with CST Capital (hereafter: the Investor), in which the Company
borrowed a total amount of up to AUD 1.62 million ($1,212 thousand) via the issue of convertible notes
(hereafter: the Notes). The Notes will be issued in two tranches with a face value of AU$1.00 per Note
(Face Value), with 1,650,000 collateral CDIs over fully paid ordinary shares (CDIs) to be issued to the
Investor prior to the first purchase of 900,000 Notes. The first tranche is for an amount of AU$0.81 million.
A subsequent tranche of up to AU$0.81 million will be issued at a later date subject to mutual consent
between Roots and the Investor. The Notes will be interest-free and convertible.
The Notes can initially be converted at 130% of the 5-day VWAP prior to issuance of the applicable
tranche. From 65 days following the date of issue, the Notes can be converted at the lower of 130% of the
5-day VWAP prior to issuance of the applicable tranche and 90% of the lowest daily VWAP during the
15 trading days preceding the conversion date. Other than with the prior written consent of the Company,
in any calendar month, upon issuance of a tranche, the Investor will receive options equal to the face value,
multiplied by 0.2, divided by the closing VWAP prior to issuance. The options will be exercisable for 18
months and have an exercise price equal to 160% of the 5-day VWAP prior to issuance of the options.
On 19 February 2019, the Company issued 1,935,484 Unlisted Options (exercisable at $0.14 on or before
19 August 2020) being the Options relating to the first tranche of Notes.
-33-
For personal use only Roots Sustainable Agricultural Technologies Ltd
Corporate Governance Statement
31 December 2018
CORPORATE GOVERNANCE STATEMENT
The Company and the Board of Directors are committed to achieving the highest standards of corporate governance.
The Board continues to review the framework and practices to ensure they meet the interests of shareholders.
A description of the Group’s main corporate governance practices is set out on the Company’s website at
http://rootssat.com/profile/corporate-governance/.
10
For personal use only
Roots Sustainable Agricultural Technologies Ltd
ASX Additional Information
31 December 2018
ASX ADDITIONAL INFORMATION
1.
SHAREHOLDINGS
The Company has ordinary shares on issue. The Company’s ordinary shares traded on the ASX are
traded as Chess Depository Interests (‘CDI’s’) under the code ROO. Each CDI has a beneficial interest
in a share.
The issued capital of the Company as at 27 February 2019 is 65,616,667. All issued ordinary fully paid
shares carry one vote per share.
The Company as at 27 February 2019 has on issue the following unlisted securities:
•
•
3,590,484 unlisted options; and
6,133,333 performance rights.
Unquoted Options
1,281,000 unquoted options with an exercise price of $0.01 and an expiry date of 30 November 2022.
20,000 unquoted options with an exercise price of $0.01 and an expiry date of 30 November 2022.
354,000 unquoted options with an exercise price of $0.01 and an expiry date of 30 November 2022.
1,935,484 unquoted options with an exercise price of $0.14 and an expiry date of 19 August 2020.
2,966,666 Class A performance rights escrowed for 24 months.
2,966,667 Class C performance rights escrowed for 24 months.
200,000 Class D performance rights expiring 5 years from issue.
2.
DISTRIBUTION OF EQUITY SECURITIES (SHAREHOLDERS AND CDI HOLDERS)
Range
Total holders
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 - 9,999,999,999
Total
45
759
312
455
80
1,651
Units % of Issued
Capital
0.04%
3.21%
3.83%
21.33%
71.59%
100.00%
24,171
2,104,910
2,515,891
13,998,886
46,972,809
65,616,667
The number of investors holding a less than marketable parcel of 5,800 ROO shares (based on a share
price of A$0.086 was 844.
3. TOP TWENTY LARGEST SHAREHOLDERS AS AT 27 FEBRUARY 2019
Holder Name
1
2
3
4
5
6
7
8
9
10
11
12
13
BOAZ WACHTEL
SUBURBAN HOLDINGS PTY LIMITED
YOUDIM PHARMACEUTICA LS LTD
J P MORGAN NOMINEES AUSTRALIA
SHARON DEVIR
ERAN FRIEDMAN
CST CAPITAL PTY LTD
ALEX MEITLIS
JACOB WEISMANN
YOEL FRIEDMAN
TOMER WEISMANN
HORATIO STREET PTY LTD
SHARON DEVIR
Number
Held
5,298,777
2,907,981
2,682,750
2,571,844
1,931,564
1,741,545
1,650,000
1,524,777
1,241,545
1,241,545
1,241,545
1,102,500
1,000,000
Percentage
8.08%
4.43%
4.09%
3.92%
2.94%
2.65%
2.51%
2.32%
1.89%
1.89%
1.89%
1.68%
1.52%
11
For personal use only Roots Sustainable Agricultural Technologies Ltd
ASX Additional Information
31 December 2018
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
14
15 MFCM NOMINEE SERVICES PTY LTD
16
17
18
19
ADAM BLUMENTHAL
JANSTEG PTY LTD
STOCK ASSIST GROUP PTY LTD
FRANKLIN INTERNATIONAL HOLDINGS PTY LTD
TAC PROFESSIONAL SERVICES PTY LTD
20
Total: Top 20 holders
962,482
956,250
916,667
800,000
780,605
740,625
1.47%
1.46%
1.40%
1.22%
1.19%
1.13%
645,500
31,938,502
0.98%
48.66%
VOTING RIGHTS
4.
Ordinary shareholders have the right to one vote at a meeting of Shareholders of the Company or a
Resolutions of Shareholders.
CDI Holders do not hold the right to vote at meetings of the Company and if they wish to take a vote,
they must direct the CHESS Depositary Nominees (CDN) on how to vote in advance of the applicable
meeting, provided that both Shareholders and CDI Holders are able to attend meetings.
5.
SUBSTANTIAL SHAREHOLDERS AS AT 27 FEBRUARY 2019
BOAZ WACHTEL
Holding
Balance
% of Issued
Capital
5,298,777
8.08%
6.
RESTRICTED SECURITIES SUBJECT TO ESCROW
The following securities are subject to escrow:
Name
1
2
3
4
5
CDI escrowed 24 months
CDI escrowed 24 months
Unlisted Options $0.01 escrowed 24 months
Performance Rights Class A escrowed 24 months
Performance Rights Class C escrowed 24 months
Number
of
Securities
15,791,987
2,966,666
1,281,000
2,966,666
2,966,667
Escrow
Period
30/11/2019
30/11/2019
30/11/2022
30/11/2019
30/11/2019
7.
There is current no on-market buyback program for any Roots listed securities.
ON-MARKET BUY BACK
GROUP CASH AND ASSETS
8.
In accordance with Listing Rule 4.10.19, the Company confirms that it has been using the cash and
assets for the year ended 31 December 2018 in a way that is consistent with its business objectives
and strategy.
12
For personal use only