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Cellectar Biosciences, Inc.AnnUAL FInAnCIAL RepoRt
FoR tHe YeAR enDeD 30 JUne 2009
17
Directors’ Report
Corporate Governance statement
Remuneration Report – Audited
Income statement
Balance sheet
statement of Changes In equity
statement of Cash Flows
notes to the Financial statements
Audit Report
shareholder Information
18
20
24
30
31
32
33
34
51
54
18
DIReCtoRs’ RepoRt
the Directors present their report together with the financial
report of Hexima Limited (‘the Company’ or ‘parent entity’) and of
the group, being the Company and its subsidiaries for the financial
year ended 30 June 2009 and the auditor’s report thereon.
directors
the Directors of Hexima Limited (‘the Company’) at any time
during or since the end of the financial year are:
G F dan o’brien
Bsc, BVMs (Murdoch University), MBA (Harvard University)
Non-executive Chairman
Dan o’Brien was appointed Chairman of the Company on
1 July 2008. He was Managing Director and Chief executive
officer of Hexima from october 2005 until 30 June 2008.
Mr o’Brien has extensive agribusiness experience including
farming investments and executive and non-executive roles
with King Island Dairy Limited, tasman Agriculture Limited, Colly
Farms Cotton Limited, spC Ardmona Limited, Coates Hire
Limited (2003 – 2007) and select Harvests Limited. His previous
roles include Chief executive officer positions with BIL Australia,
Mattel Asia pacific and the King Island Company Limited.
Mr o’Brien has been a director of thomas and Coffey Limited
since 2005.
Mr o’Brien is aged 53. He has been a Director of the Company
since 17 May 2002 and is a member of the Remuneration and
Audit and Risk Management Committees.
Professor Adrienne e Clarke AC
FAA, Ftse, Bsc (Hons), phD (the University of Melbourne)
Non-executive deputy Chairman
(formerly Chief Science officer)
professor Adrienne Clarke is a founding member of Hexima,
and served as the Chief science officer from April 2006 until
30 June 2009. professor Clarke is Laureate professor at the
University of Melbourne. she was appointed to a personal Chair
at the school of Botany (awarded in 1982) and is past Director
of the plant Cell Biology Research Centre, the University of
Melbourne (1982-1999), former Chairman of CsIRo (1991-96),
former Lieutenant Governor of Victoria (1997-2000) and former
Ambassador for Biotechnology for Victoria (2001-2003). she
was made an officer of the order of Australia in 1991 and a
Companion of the order of Australia in 2004.
professor Clarke was president of the International society for
plant Molecular Biology (1997-98). she is a Foreign Member,
American Academy of Arts and science; Foreign Associate,
national Academy of sciences, UsA; Companion, the Institute
of engineers, Australia; Fellow, Australian Academy of science;
and Fellow, Australian Academy of technological sciences
and engineering.
professor Clarke was formerly a Director of WMC Limited,
Woolworths Limited (1994 – 2007) and Fisher & paykel
Healthcare Limited (2002 – 2008).
professor Clarke is aged 71. she has been a Director of
the Company since 15 november 2001. From 1 July 2009,
professor Clarke serves in a non-executive capacity and has
become a member of the Remuneration and Audit and Risk
Management Committees.
Hexima Limited // 2009 AnnUAL RepoRt
Joshua T Hofheimer
AB (Dartmouth College), JD (Harvard Law school)
Chief executive officer/Managing director
Joshua Hofheimer became Ceo and Managing Director of
Hexima in July 2008. Mr Hofheimer has extensive experience in
the agricultural science and biotechnology sectors, in structuring
and negotiating complex commercial transactions and joint
ventures with both start-ups and global industry leaders.
Mr Hofheimer’s previous role was partner at sidley Austin LLp,
a Los Angeles based international law firm. In the last 7 years
with the firm, he specialised in the plant biotechnology sector,
including developing and implementing business strategies for
commercialisation of multiple intellectual property platforms.
He also served as a leader in the firm’s Intellectual property and
Commercial transactions practice.
Mr Hofheimer was formerly a member of several boards, including
the Jonsson Cancer Center Foundation at UCLA and the Zimmer
Children’s Museum, and is active in charitable foundations such as
the eIF Revlon Run/Walk for Women’s Cancers.
Mr Hofheimer is aged 40.
Steven M Skala
BA, LL.B (Hons) (University of Qld), BCL (oxford University)
Non-executive director
(formerly Non-executive Chairman)
steven skala is Vice Chairman, Australia and new Zealand of
Deutsche Bank AG. He retired from legal practice after almost
25 years experience in commercial law. Between 1985 and 2004
he was a partner of law firm, Arnold Bloch Leibler, and was Head
of its Corporate and Commercial practice for several years.
Mr skala is a Director of the Australian Broadcasting
Corporation, Deutsche Australia Limited, Max Capital Group
Limited, Wilson HtM Investment Group Limited, the Australian
Ballet and the Centre for Independent studies. He is also Vice
president of the Walter and eliza Hall Institute for Medical
Research and was previously Chairman of Film Australia Limited.
Mr skala is aged 53. He has been a Director of the Company
since 17 May 2002 and was Chairman of the Company until
30 June 2008. He is also a member of the Remuneration and
Audit and Risk Management Committees.
Hugh M Morgan AC
LLB, BComm (the University of Melbourne)
Non-executive director
Hugh Morgan is principal of First Charnock pty Ltd, Chairman
of Biodiem Limited and a member of the Lafarge International
Advisory Board. He is also a trustee emeritus of the Asia society
new York, president of the national Gallery of Victoria Foundation
and Chairman of the order of Australia Association Foundation.
Mr Morgan was a Director of the Board of the Reserve Bank
of Australia until July 2007 and he was president of the Business
Council of Australia from 2003-2005. He is also immediate
past president of the Australia Japan Business Co-operation
Committee and immediate past Co-Chair of the Commonwealth
Business Council, and continuing Director.
Mr Morgan was Chief executive officer of WMC Limited from
1986 to 2003. He was a Director of Alcoa of Australia from 1977
to 1998 and a Director of Alcoa Inc from 1998 to 2001.
Mr Morgan is aged 68. He has been a Director of the
Company since 10 May 2007. He is Chairman of the Audit
and Risk Management Committee and a member of the
Remuneration Committee.
Professor Jonathan west
BA (University of sydney), phD (Harvard University)
Non-executive director
professor Jonathan West is the Director of the Australian
Innovation Research Centre. prior to assuming his current
appointment, he taught for 18 years at the Harvard University
Graduate school of Business Administration, where he was
Associate professor, founding Director of the Harvard University
Life sciences Initiative, and from 1998-1999 the novartis Faculty
Research Fellow. He has been Visiting professor at Hitotsubashi
University and the nomura school of Advanced Management
in tokyo, Japan and Visiting professor at the University de paris
Ix-Dauphine, sorbonne.
professor West is also Chairman of the Asia Advisory Council
of Bunge Ltd, one of the world’s largest agribusiness processing
and trading companies, and has served as an advisor to
other major corporations and several Governments around
the world, including in the life sciences field, Dupont, Roche,
novartis, syngenta and the J.R. simplot Company, along with
the Governments of singapore, Japan, Hong Kong and France.
He was a member of the scientific Advisory Board of the
novartis Agricultural Discovery Institute in La Jolla, California.
In Australia, he has served on the prime Minister’s science,
engineering, Innovation Council’s Working Group on science and
technology in China and India and in 2006 was ‘eminent thinker
in Residence’ with the premier of nsW.
professor West is aged 52. He has been a Director of the
Company since 7 november 2005. He is Chairman of the
Remuneration Committee and a member of the Audit and Risk
Management Committee.
Company secretary
Ms Justine Heath FCA was appointed to the position of
Company secretary of Hexima Limited in December 2007.
Ms Heath has experience across a range of industries and
previously held senior finance roles with the Faulding Group and
santos Limited.
19
since the date of this report, Mr skala
has been appointed as Chairman of the
Company, effective 2 october 2009.
Mr o’Brien has resigned as a Director
of the Company as of this date.
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directors’ meetings
the number of Directors’ meetings (including meetings of committees of Directors) and the number of meetings
attended by each of the Directors of the Company during the financial year are:
GF Dan o’Brien
Adrienne e Clarke2
Joshua t Hofheimer
steven M skala
Hugh M Morgan
Jonathan West
board Meetings
Held1
11
11
11
11
11
11
Attended
11
11
11
10
10
10
Audit and risk
Management Committee
Attended
2
-
-
2
2
2
Held1
2
-
-
2
2
2
remuneration Committee
Attended
2
-
-
2
1
2
Held1
2
-
-
2
2
2
1 number of meetings held during the time the Director held office during the year.
2 professor Clarke joined the Audit and Risk Management and Remuneration Committees from 1 July 2009.
20
CoRpoRAte GoVeRnAnCe stAteMent
This statement outlines the main corporate governance
practices in place throughout the financial year, which comply
with ASx Corporate Governance Council recommendations,
unless otherwise stated.
the Board of directors
the Board is responsible for the direction and supervision of
Hexima’s business on behalf of the shareholders, by whom they
are elected and to whom they are accountable.
the Board’s responsibilities include:
à protecting and enhancing the value of Hexima’s assets;
à setting strategies and directions, then monitoring and
reviewing progress against these strategic objectives;
à reviewing and ratifying internal controls, codes
of conduct and legal compliance;
à ensuring the significant risks facing Hexima have
been identified and adequate control, monitoring
and reporting mechanisms are in place;
à approving transactions relating to acquisitions, divestments
and capital expenditure above delegated authority limits; and
à approving and monitoring financial and other reporting.
the Board has adopted a Board Charter, which sets out
values and business behaviours necessary to maintain
confidence in Hexima’s integrity. It includes a trading policy
governing trading in securities by Directors, officers and
employees and details the respective roles and responsibilities
of the Board and management.
the Board has delegated responsibility for operation and
administration of the Company to the Managing Director and
executive management. Responsibilities are delineated by formal
authority delegations.
directors and executive education
Incoming Directors and executives participate in informal
meetings to increase their understanding of the Company, its key
assets and the competitive market in which it operates. through
these meetings, Directors and executives review the Company’s
policies and procedures for good corporate governance, including
delegations and reservations of authority and the roles of key
personnel and Board committees. they have access to continuing
education to update and enhance their skills and knowledge.
A review of the performance of the Board will be undertaken
annually by the Chairman, in consultation with the Board.
Composition of the Board
the Constitution of the Company provides that the number
of Directors shall not be less than three. there are currently
six Directors in office at the date of this report and their
names and qualifications are set out on pages 30 to 31 of this
Directors’ Report.
the Asx best practice recommendations require a majority of the
Board to be independent Directors and the chairperson to be an
independent director. Currently, the Board has one director who
satisfies the Asx guidelines for independence (being Jonathan
West). Mr Dan o’Brien, Mr steven skala, Mr Hugh Morgan and
professor Adrienne Clarke (from 1 July 2009) are non-executive
Directors but do not qualify as independent because of their
shareholdings in Hexima, and in Mr o’Brien and professor Clarke’s
case, due to their previous executive roles with the Company. the
Board considers their significant commitment as shareholders
(which aligns their interests with those of other shareholders)
and broad experience as directors of other companies provide
advantages to the Board which outweigh any disadvantage in them
not satisfying the Asx guidelines for independence. the Board will
review this position at least annually.
Board Committees
to assist in the execution of its responsibilities, the Board
has established a number of board committees including a
nomination Committee, a Remuneration Committee, an Audit
and Risk Management Committee and a Communications
Committee (established on 18th August 2009). these
committees have written mandates and operating procedures,
which are reviewed on a regular basis.
the full Board has 12 meetings scheduled for the coming year.
extraordinary meetings will be convened at such other times as
may be necessary to address any specific significant matters that
may arise.
the agenda for meetings is prepared in conjunction with the
Chairman and the Chief executive officer/Managing Director.
submissions are circulated in advance. executives are regularly
involved in Board discussions.
Nomination Committee
the Board has in place a nomination Committee to assist
it in ensuring the Board has an effective composition, size
and commitment.
the nomination Committee develops criteria for Board
membership, identifies specific individuals for nomination as
Directors and establishes processes for the review of the
performance of individual Directors and the Board as a whole.
In addition, it is the policy of the nomination Committee to
meet as early as practicable prior to the expiration of the
term of office of a Director to consider suitably skilled and
experienced individuals for nomination as Directors.
Further details of the nomination Committee’s charter form part
of the Board Charter, which is available on the Company’s website.
each of the non-executive Directors are currently on the
nomination Committee. the Board reviewed the structure of
the Board and senior executive teams throughout the current
financial year within existing scheduled Board meetings. Formal
meetings of the nomination Committee will be scheduled for
the coming financial year as required.
Hexima Limited // 2009 AnnUAL RepoRt
21
remuneration Committee
the Board will review and reward the performance of the
senior management team. In doing so, they will consider
recommendations from the Remuneration Committee.
the Remuneration Committee reviews and makes
recommendations to the Board on remuneration packages
and policies applicable to Key executives and Directors. the
Remuneration Committee Charter forms part of the Board
Charter, which is available on the Company’s website.
the Remuneration Committee will consist of at least three
Directors, a majority of whom are non-executive Directors
and at least one of whom is an independent director. this
differs from the Asx best practice recommendations which
require a majority of independent Directors and an independent
Chairman. Given the current composition of the Board, it is not
possible for Hexima to satisfy the Asx recommendations as to
independence. the current members are professor Jonathan
West (Chairman), Mr Dan o’Brien, Mr steven skala, Mr Hugh
Morgan and professor Adrienne Clarke (from 1 July 2009).
the Remuneration Committee meets at least twice a year in
order to review and make recommendations to the Board. the
Remuneration Committee met twice during the year and the
committee members’ attendance record is disclosed in the table
of Directors’ meetings on page 19. In addition, remuneration
issues were addressed at a number of meetings of the full Board
during the year.
the Remuneration Committee may invite any executive
management team members or other individuals to attend
meetings of the Remuneration Committee as it considers
appropriate. the Remuneration Report is set out on pages 24
to 28 and forms part of the Directors’ Report for the financial
year ended 30 June 2009.
Audit and risk Management Committee
the Board has in place an Audit and Risk Management
Committee to assist it in verifying and safeguarding the integrity
of Hexima’s financial reporting. the Audit and Risk Management
Committee Charter forms part of the Board Charter, which is
available on the Company’s website.
the Audit and Risk Management Committee reviews the
financial information which is provided to shareholders and
others, the systems of internal controls which management and
the Board have established and the audit process.
the Audit and Risk Management Committee also reviews the
performance of the external auditors on an annual basis and
normally meets with them during the year to:
à discuss the external audit and internal audit plans,
identifying any significant changes in structure, operations,
internal controls or accounting policies likely to
impact the financial statements and to review the fees
proposed for the audit work to be performed;
à review the half-year and preliminary final report
prior to lodgement with the Asx, and any significant
adjustments required as a result of the auditor’s
findings, and to recommend board approval of these
documents, prior to announcement of results;
à review the draft annual and half-year financial report, and
recommend board approval of the financial report; and
à review the results and findings of the auditor, the adequacy
of accounting and financial controls, and to monitor
the implementation of any recommendations made.
Audit and Risk Management Committee meetings are to be
held periodically throughout the year. It is the policy of the
Board that the members of the Audit and Risk Management
Committee should be non-executive Directors, at least one of
whom should also be independent. this differs from the Asx
best practice recommendations which require a majority of
independent Directors and an independent Chairman. Given the
current composition of the Board, it is not possible for Hexima
to satisfy the Asx recommendations as to independence. the
current Audit and Risk Management Committee comprises
Mr Hugh Morgan as Chairman, Mr steven skala, Mr Dan o’Brien,
professor Jonathan West and professor Adrienne Clarke (from
1 July 2009).
the Chief executive officer/Managing Director, Chief Financial
officer and external auditors will generally attend all Audit and
Risk Management Committee meetings. the Audit and Risk
Management Committee met twice during the year and the
committee members’ attendance record is disclosed in the table
of Directors’ meetings on page 19.
the Chief executive officer/Managing Director and the Chief
Financial officer have declared in writing that the records
for the year have been properly maintained, the Company’s
financial reports for the year ended 30 June 2009 comply
with accounting standards and present a true and fair view of
the Company’s financial condition and operating results. this
statement is required annually.
Communication with shareholders
Hexima’s policy is to provide timely, open and accurate
information to all stakeholders, including shareholders, regulators
and the wider investment community. the Board Charter
includes a continuous disclosure protocol to ensure compliance
with the Corporations Act 2001 and the Listing Rules disclosure
requirements.
In summary, the Company’s continuous disclosure protocol
operates as follows:
à the Board has delegated its responsibility for approving
public announcements to the Communications Committee
(established 18th August 2009), comprising the Chairman
and the Chief executive officer/Managing Director;
à the Company secretary is responsible for
ensuring all communications with the Asx are
made in a timely and appropriate manner;
à the full Annual Financial Report and Half-Yearly
results commentary are lodged with the Asx and
are available on the Company’s website and is
sent to all shareholders who request them;
à the Annual Financial Report and the Half-
Yearly Accounts are lodged with the Asx and
sent to any shareholder on request; and
à all media releases and information provided to analysts
or the media during briefings are released to the Asx.
Hexima’s communications strategy is set out in the Board
Charter and is designed to promote effective communication
with shareholders and encourage effective participation at
general meetings.
22
Risk management
the Board is responsible for the assessment of risk.
intellectual Property
Intellectual property is Hexima’s most important asset and
protection of its Ip portfolio is critical to the Company’s ability to
implement its business strategy. Hexima has consistently invested
significant amounts in the development and maintenance of this
Ip portfolio.
Hexima’s Ip Committee, chaired by professor Marilyn Anderson,
meets regularly to identify and monitor the creation of Ip and
to monitor and review claims in the same technical field filed by
other companies. the Committee works closely with Hexima’s
Us and Australian patent attorneys.
the Committee also develops and maintains appropriate
protocols for recording research results and maintaining the
confidentiality of know-how and information associated with
Hexima’s trials and technology.
regulatory Framework (including environmental regulation)
the use of ag-biotechnology is regulated in the majority of
countries in which Hexima will seek to commercialise its
technology. the regulatory framework, which varies from
country to country, is generally based on an assessment of the
risk associated with the technology.
In Australia, the use of ag-biotechnology is regulated by the Gene
technology Act 2000. Hexima’s gene technology research at the
University of Melbourne and La trobe University is overseen by
the office of the Gene technology Regulator and all field trials
conducted by Hexima have been specifically licensed by the
office of the Gene technology Regulator.
Financial reporting
the Chief executive officer/Managing Director and the Chief
Financial officer have declared in writing to the Board that the
Company’s financial reports are founded on a sound system of
risk management and internal compliance and control which
implements the policies adopted by the Board.
Monthly actual results are reported against budgets
approved by Directors and revised forecasts for the year
are prepared regularly.
Funds Management
the Company has considerable funds on deposit following its
successful Ipo in 2007. the Company’s policy is to invest these
funds in term deposits or bank bills.
ethical standards
All Directors, executives and employees are expected to act
with the utmost integrity at all times to enhance the reputation
and performance of the Company. every employee has a
supervisor to whom they may refer any issues arising from
their employment.
Conflicts of interest
Directors must keep the Board advised, on an ongoing basis,
of any interest that could potentially conflict with those of the
Company. the Board has procedures to assist Directors to
disclose potential conflicts of interest.
Trading in Company Securities by directors and employees
the Company has a policy regarding the trading in Company
securities by Directors and employees. the policy details the
insider trading provisions of the Corporations Act and provides
for Directors, executives and employees to be able to trade
at any time except when there is a ‘black-out’, subject to
their having obtained approval from the Company secretary.
Company-wide ‘black-outs’ will occur for a period commencing
6 weeks prior to the release of the half-year and annual results
and ending 24 hours after such a release and for a period
commencing 2 weeks prior to the Company’s annual general
meeting and ending 24 hours after the annual general meeting.
Black-outs can occur at any other time for the Company or for
certain individuals prior to any major announcement or when
they are possession of price sensitive information.
All new employees and all existing employees (on an annual
basis) are required to sign an acknowledgement that they are
aware of the Company’s share trading policy.
independent advice
each Director has the right of access to all relevant Company
information and to the Company’s executives and, subject to
prior consultation with the Chairman, may seek independent
professional advice at the Company’s expense. A copy of the
advice received by the Director will be made available to all
members of the Board.
Hexima Limited // 2009 AnnUAL RepoRt
pRInCIpAL ACtIVItIes
23
the principal activity of the Group during the financial year was
the research, development and commercialisation of technology
for the genetic modification of crops, primarily to enhance their
resistance to insects and fungal pathogens.
Operating and Financial Review of
the group and the Company
$000
Revenue
net loss before financing
income/expense
net financing (costs)/income
Income tax expense
net loss after tax
attributable to members
Dividends
Basic earnings/(loss)
per share (cents)
The Group and
the Company
2009
1,046
The Company
2008
1,156
(13,358)
2,082
-
(11,276)
nIL
(14.4)
(5,441)
2,411
-
(3,030)
nIL
(4.5)
Summary
the Board is pleased with the commercial and scientific progress
made by the Group in a challenging economic environment.
since listing in 2007:
à Hexima has entered into its first development and
commercialisation agreement for one of its major technology
platforms, fungal disease control. this agreement secures
the commercial path to market for the technology in
corn and soy, the two major crops, currently accounting
for more than 80% of the area planted to GM crops.
à As part of this agreement, the Group acquired
intellectual property rights valued at $6.0m, recorded
as a non-cash R&D expense in the year ended
30 June 2009 (see operating & Financial Review).
à the Group has achieved important scientific goals,
which materially advance its technologies.
à the Group has conserved cash and operated below internal
budgets and publicly announced expenditure estimates.
the non-cash research and development expense of $6.0 million
was recorded after the Group entered into a co-development
and commercialisation agreement on 7 August 2008 with
Dupont agricultural business, pioneer Hi-Bred International, Inc.
(Dupont/pioneer). As part of this agreement to commercialise
fungal resistance technology, Hexima acquired intellectual
property rights valued at $6.0 million. As consideration, and
pursuant to a placement agreement, Hexima issued 4,000,000
ordinary shares at $1.50 per share. the financial effects of this
transaction have been recorded as a research and development
expenditure of $6.0 million with a corresponding increase in
share capital.
net finance income for the Group and the Company for the
financial year ended 30 June 2009 was $2.082 million. the net
finance income for the Company was $2.411 million for the
previous year, reflecting lower cash balances as cash is utilised
and lower interest rates in the current reporting period.
outlook
During the financial year Hexima announced its first definitive
development and commercialisation agreement with Dupont/
pioneer. the agreement provides for the development and
commercialisation of transgenic anti-fungal protein disease
technology and sets out milestone payments and royalties.
pioneer and Hexima have combined intellectual property and
anti-fungal protein assets to create a single, exclusive program for
the development and commercialisation of transgenic anti-fungal
protein disease technology. Hexima is leading the initial stage
crop validation and pioneer will lead the late stage development.
As part of the agreement, pioneer will commercialise the
technology in its major crops, corn and soy, and Hexima will
control the technology in all other crops.
the initial target is broad-spectrum disease fungal resistance in
corn. Fungal pathogens cause extensive damage to corn and
the problem is growing as intensive farming techniques and
reduced crop rotations combine to encourage fungal growth.
In the largest GM corn markets, the United states and Brazil,
it is estimated that fungal disease causes yield losses worth
approximately Us$8 billion each year.
At 30 June 2009, the Group has $30.5m in cash and interest
receivables, which provide a strong base to fund the Group’s
activities as it advances its technologies to market.
As well as establishing a clear path to market for the two largest
GM crops, corn and soy, the agreement represents a significant
validation of the Group’s technology and scientific expertise.
operating and Financial review
the Group had net cash outflows from operating activities of
$7.164 million for the year ended 30 June 2009 compared with
$6.072 million for the prior period, reflecting the expansion of
the Group’s research and development activities.
the Group and the Company recorded a loss after tax of
$11.276 million for the year ended 30 June 2009. the Company
recorded a loss after tax of $3.030 million for the previous
year. this result reflects the expansion of the Group’s activities in
researching, developing and commercialising its technologies and
a non-cash research and development expense of $6.0 million.
the Group also continues to progress the development
and commercialisation of its other technologies: insect
resistance technology and the Multi-Gene expression Vehicle
(MGeV). the Group has been awarded a grant under the
Federal Government’s Climate Ready program to accelerate the
development of the insect resistance technology and now plans
to explore combinations of existing proprietary proteinase
Inhibitors, newly identified proteins and Bts (insecticidal bacterial
toxins currently used in commercial GM insect resistance)
to further develop the innovative approach to the control
of insect pests. on 10 August 2009, the Group announced a
non-exclusive research licence with Dupont/pioneer for the
evaluation of the MGeV technology in corn and soy using
pioneer genes. this licence enables Dupont/pioneer to use
the MGeV technology outside of the current fungal disease
collaboration, thus extending the partnership into new areas
of co-operation. It is an important validation of the Group’s
science and technology and provides insight into the potential
utility of the MGeV for different proteins and in an additional
major GM crop, soy.
24
ReMUneRAtIon RepoRt – AUDIteD
significant Changes in the state of affairs
In the opinion of Directors the following significant changes in
the state of affairs of the Group occurred during and since the
end of the financial year under review:
on 7 August 2008, the Company announced a development
and commercialisation agreement with Dupont business, pioneer
Hi-Bred International, Inc., for the development of transgenic
anti- fungal protein disease technology in corn, soy and other
crops. this nature and progress of this collaboration is described
above (under ‘outlook’).
In July 2009, professor Marilyn Anderson was appointed to the
position of Chief science officer. professor Anderson is one
of the Group’s founders and is leading the development of
the Group’s anti-fungal protein technology within the Dupont/
pioneer partnership. she has played a critical part in developing
the Group’s Ip portfolio and is a named inventor on all of the
Group’s key patents. the former Chief science officer, professor
Adrienne Clarke, continues her contribution to the Group in a
non-executive capacity as Deputy Chairman.
dividends
the Company has not paid or declared any dividends during or
since the end of the financial year ended 30 June 2009.
Likely developments
Further disclosure of information regarding likely developments
in the operations of the Company and the expected results of
those operations in future financial years has not been included
in this report because, in the opinion of the Directors, disclosure
of the information may prejudice the interests of the Company.
Principles of Remuneration – audited
Key management personnel (including Directors of the
Company and other executives) have authority and responsibility
for planning and controlling the activities of the Company and
the Group. For the financial year ended 30 June 2009, key
management personnel comprises all Directors, executives
and the Company secretary, being Mr Dan o’Brien, Mr Joshua
Hofheimer, professor Adrienne Clarke, Mr steven skala,
professor Jonathan West, Mr Hugh Morgan, professor Marilyn
Anderson, Dr Robyn Heath and Ms Justine Heath. Remuneration
levels for key management personnel are set to attract and
retain appropriately qualified and experienced directors and
executives. the Remuneration Committee obtains independent
advice on remuneration packages and reviews remuneration at
least on an annual basis.
Remuneration structures take into account the capability and
experience of key management personnel. Remuneration
includes a mix of fixed and variable remuneration as well as
short and long term incentives.
Fixed Remuneration
Fixed remuneration consists of base remuneration, which is
calculated on a total cost basis and includes any FBt charges
related to employee benefits, as well as employer contributions
to superannuation funds.
Performance Linked Remuneration
performance linked remuneration may include short and long
term incentives.
short term incentive bonuses are based on the satisfaction
of specified performance criteria, which may include financial
or non-financial objectives. the Remuneration Committee
approves the offer and payment of short term incentive bonuses
to key management personnel and to other employees.
Long term incentives may be provided as options over the
Company’s ordinary shares and other securities. options were
issued to Mr Joshua Hofheimer and Ms Justine Heath during
the financial year. Details are provided on page 41 of the
Directors’ Report.
Consequences of Performance
on shareholder Wealth
Hexima is a development stage company and the remuneration
of key management personnel is not determined by the level
of revenue, profit or dividends. Instead, consideration is given
to the progress of scientific programs, the commercialisation of
those programs, the development of the Company’s intellectual
property and asset base and long-term share price performance.
Hexima Limited // 2009 AnnUAL RepoRt
25
service Contracts
the Group and the Company has entered into service contracts
with key management personnel, which outline the components
of compensation paid to key management personnel, but do not
prescribe how compensation levels are modified from year to
year. Compensation levels are reviewed each year to take into
account cost-of-living changes, any change in scope of the role
performed by the senior executive and any changes required to
meet the principles of the compensation policy.
All employment contracts may be terminated immediately for
cause or for material underperformance, except in the case
of Mr Hofheimer, whose contract requires that the Company
give him 10 days’ notice of termination for cause or material
underperformance.
GF dan o’brien
Mr o’Brien was appointed Chairman of the Board of Directors
from 1 July 2008. Hexima contracts Dromoland Capital pty
Limited to provide Mr o’Brien’s services. Mr o’Brien is the
controlling shareholder, the director and a full time employee
of Dromoland Capital pty Limited.
Joshua T Hofheimer
Mr Hofheimer was employed by the Company from May
2008 and he was formally appointed as Chief executive
officer/Managing Director from 1 July 2008. Mr Hofheimer
has an employment contract with the Company, which has an
unlimited term, but may be terminated by Mr Hofheimer giving
the Company six months’ notice or by the Company giving
Mr Hofheimer 60 days’ notice. the Company retains the right to
terminate the contract immediately, by making payment equal to
60 days’ pay in lieu of notice.
Mr Hofheimer’s remuneration package includes a long-term
incentive of 1,000,000 Initial share options (exercisable at $nil),
with a two year vesting period, and 2,000,000 share options
(exercisable at $1.25) with 25% of these options having a 2, 3, 4
and 5 year vesting period. If Hexima terminates Mr Hofheimer’s
employment other than for cause within the first 2 years of
employment, the 1,000,000 Initial share options and the first
25% of the unvested share options will vest immediately.
If Hexima terminates Mr Hofheimer’s employment after the
first two years of employment, he will be entitled to exercise all
the share options that have already vested, plus the next 25%
portion of the unvested share options. If Hexima terminates his
employment for cause at any time, Mr Hofheimer will have no
entitlement or right to any of the unvested Initial share options
or unvested share options.
Professor Adrienne e Clarke
professor Clarke served as Deputy Chairman and Chief science
officer during the financial year and had an employment
contract with the Company. professor Clarke retired from
executive duties from 1 July 2009 and continues to serve as
Deputy Chairman and non-executive Director.
Professor Marilyn A Anderson
professor Anderson was appointed Chief science officer from
1 July 2009. she was formerly senior Vice president Research
and Discovery. professor Anderson is an employee of La trobe
University and Hexima contracts her services through a
Research Agreement with the university. In addition to her
employment by the university, professor Anderson also has an
employment contract with the Company. this employment
contract has a term of three years from 1 December 2007 and
may be terminated with six months’ notice by the employee.
dr robyn L Heath
Dr Heath, senior Vice president product Development, is an
employee of the University of Melbourne, and Hexima contracts
her services through a Research Agreement with the university.
In addition to her employment by the university, Dr Heath
also has an employment contract with the Company. this
employment contract has a term of three years from
1 December 2007 and may be terminated with six months’
notice by the employee.
Justine C Heath
Ms Heath, Company secretary and Chief Financial officer, has
an employment contract with the Company for an unlimited
term, which may be terminated with two months’ notice by
either party. the Company retains the right to terminate the
contract immediately, by making payment equal to two months’
pay in lieu of notice. the Company is required to provide
six months’ salary in lieu of notice in the event of a change of
control of the Company.
Non-executive directors
the Constitution provides that non-executive Directors may
be paid or provided fees or other remuneration for their
services as a Director of Hexima (including as a member of
any Directors’ committee). the total amount or value of this
remuneration must not exceed $500,000 (including mandatory
superannuation) per annum or such other maximum amount
determined by the Company in a general meeting.
A non-executive Director may be paid remuneration for
services outside the scope of ordinary duties of the Director.
non-executive Directors may also be paid expenses properly
incurred in attending meetings or otherwise in connection with
the Company’s business.
Fees payable to non-executive Directors for the financial year
ended 30 June 2009 were set at $55,000 per annum for non-
executive Directors and $110,000 per annum for the Chairman.
Additional ‘per diem’ fees are paid where services rendered are
above normal requirements. there has been no change to fees
paid to non-executive Directors since the Company listed in 2007.
Details of the nature and amount of each major element of the
remuneration of each Director of the Company and each of
the named officers of the Company, which is consistent with
that of the consolidated entity, (including key management
personnel) receiving the highest remuneration are included
in the table following.
26
directors’ and executive Officers’ Remuneration (Company and Consolidated) – audited
Details of the nature and amount of each major element of remuneration of each Director of the Company and each key management
personnel are:
Short term employee benefits
Short Term
Incentive
(cash)
Fixed
Remuneration
(Salary & Fees)
Total
Short-term
employee
benefits
Share based payments
Share
Options
Issued(10)
Converting
Notes Issued
Post
Employment
Benefits –
Superannuation
Proportion of
remuneration
performance
related
Value of
Options as
proportion of
Remuneration
Total
Remuneration
Non-executive directors
GF Dan o’Brien (1)
(Chairman)
steven M skala (2)
Jonathan West (9)
Hugh M Morgan
Adrienne e Clarke (3)
(Former Chief science officer)
executive directors
Joshua t Hofheimer (4) (7)
(Ceo)
executives
Marilyn A Anderson (5)
(Chief science officer)
Robyn L Heath (6)
(senior Vice president
product Development)
Justine C Heath (7)
(CFo, Co. secretary)
Adam L Hall (8)
(Former Chief operating officer)
total
total
2009
2008
2009
2008
2009
2008
2009
2008
2009
2008
2009
2008
2009
2008
2009
2008
2009
2008
2009
2008
2009
2008
155,962
600,000
-
100,918
50,458
106,458
50,458
50,458
205,864
308,798
585,576
69,711
126,162
72,203
38,724
16,991
185,000
136,778
-
224,462
1,398,204
1,686,777
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
155,962
600,000
-
100,918
50,458
106,458
50,458
50,458
205,864
308,798
-
-
-
-
-
-
-
-
-
-
585,576
69,711
212,606
-
126,162
72,203
38,724
16,991
-
-
-
-
185,000
-
136,778
-
-
-
-
224,462
- 1,398,204
- 1,686,777
7,680
-
-
-
220,286
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
14,038
-
55,000
9,082
4,542
4,542
4,542
4,542
60,327
27,792
170,000
600,000
55,000
110,000
55,000
111,000
55,000
55,000
266,191
336,590
14,424
1,717
812,606
71,428
11,354
6,498
37,000
24,666
137,516
78,701
75,724
41,657
16,648
12,309
-
39,062
209,328
149,087
-
263,524
217,875 1,836,365
130,210 1,816,987
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
26%
-
-
-
-
-
4%
-
-
-
-
-
Notes in relation to the table of directors’ and executive officers’ remuneration – audited
1. Mr o’Brien was appointed Chairman on 1 July 2008. He was previously
the Chief executive officer/Managing Director. Mr o’Brien was paid the
agreed Chairman’s fee of $110,000 for the year ended 30 June 2009, plus an
additional $60,000 reflecting the extra services performed in the handover
of responsibilities to the incoming Chief executive officer/Managing Director.
2. Mr skala was the Chairman of the Company until 30 June 2008 and
continued as a non-executive Director from 1 July 2008.
3. professor Clarke was Chief science officer and an executive Director of
the Company until 30 June 2009. From 1 July 2009 professor Clarke serves
as a non-executive Director. she continues in her role as Deputy Chairman.
4. Mr Hofheimer received allowances for rent and health benefits during
the year ended 30 June 2009. Rental expenses totaled $58,157 and health
benefits amounted to $46,341 for the period.
5. professor Anderson is employed by La trobe University. the Company
engages her services through a Research Agreement with the university and
through a separate direct employment agreement. professor Anderson’s
total remuneration from the Company and La trobe University (in relation
to services performed for Hexima) was $267,516, comprising $137,516
paid directly by the Company and $130,000 paid by La trobe University (for
the services performed for Hexima). the amount shown in the table above
represents payments made directly to professor Anderson by the Company
and the consolidated entity only.
6. Dr Heath is employed by the University of Melbourne. the Company
engages her services through a Research Agreement with the university
and through a separate direct employment agreement. Dr Heath’s total
remuneration from the Company and the University of Melbourne was
$195,031, comprising $75,724 paid directly by the Company and $119,307
paid by the University of Melbourne. the amount shown in the table above
represents payments made directly to Dr Heath by the Company and the
consolidated entity only.
7. share options were issued to Mr Hofheimer and Ms Justine Heath during
the year ended 30 June 2009.
8. Mr Hall resigned on 30 november 2007.
9. Jonathan West is paid $55,000 p.a as a non-executive Director. In respect
of the year ended 30 June 2008, professor West was paid an additional
$56,000 for additional business development consulting work performed
on behalf of the consolidated entity.
10. the fair value of options is calculated at grant date using the Binomial
Approximation option pricing model and allocated to each period evenly
over the period from grant date to vesting date. the value disclosed is the
portion of the fair value of the options recognized in this reporting period
Hexima Limited // 2009 AnnUAL RepoRt
27
equity instruments – audited
All options refer to options over ordinary shares of Hexima Limited, which are
exercisable on a one-for-one basis under the employee share option plan.
options and rights over equity instruments granted as compensation – audited
Details on options over ordinary shares in the Company that were granted as
compensation to each key management personnel during the reporting period and
details on options that vested during the reporting period are as follows:
Number of
options granted
during 2009
Grant date
Fair value per
option at grant
date ($)
exercise price
per option ($) expiry date
Number of
options vested
during 2009
directors
Joshua Hofheimer
Joshua Hofheimer
Joshua Hofheimer
Joshua Hofheimer
Joshua Hofheimer
executives
Justine Heath
1,000,000
500,000
500,000
500,000
500,000
19 December 2008
19 December 2008
19 December 2008
19 December 2008
19 December 2008
20,000
19 December 2008
0.39
0.17
0.19
0.20
0.21
0.38
-
1.25
1.25
1.25
1.25
24 november 2018
24 november 2018
24 november 2018
24 november 2018
24 november 2018
-
-
-
-
-
-
24 november 2018
20,000
no options have been granted since the end of the financial
year. the options were provided at no cost to the recipients.
In respect of the 1,000,000 options granted to Joshua Hofheimer,
these options vest in June 2010. If employment is terminated
(other than for cause) or resignation (other than for cause)
before the first exercise date of 1 July 2010 will result in options
vesting immediately. the options must be exercised within
12 months of termination of employment.
In respect of the 2,000,000 options (in 4 tranches of 500,000),
the 4 tranches of 500,000 options vesting at 1 July 2010,
1 July 2011, 1 July 2012, 1 July 2013.
In the event of termination of employment (other than for cause)
or resignation at the request by Hexima for resignation (other
than for cause) before the First exercise Date of tranche 1 will
result in 500,000 options (tranche 1) vesting immediately. these
options must be exercised within 12 months of termination of
employment. For the avoidance of doubt, the remaining unvested
options will lapse at the time of the termination.
In the event of termination of employment (other than for
cause) or resignation at the request by Hexima for resignation
(other than for cause) after the First exercise Date of tranche
1 will result in the next tranche of unvested options vesting
immediately. All vested options must be exercised within
12 months of termination of employment. For the avoidance of
doubt, the remaining options which have not been accelerated
and have not vested at the time of the termination will lapse.
the options granted to Justine Heath have vested at the grant
date and relate to past services.
exercise of options granted as compensation – audited
no options were exercised during 2009 financial year.
Analysis of options over equity instruments granted as compensation – audited
options granted
Number
date
% vested
in year
% forfeited
in year (A)
Financial years in which grant vests
directors
Joshua Hofheimer
Joshua Hofheimer
Joshua Hofheimer
Joshua Hofheimer
Joshua Hofheimer
executives
Justine Heath
1,000,000
500,000
500,000
500,000
500,000
19 December 2008
19 December 2008
19 December 2008
19 December 2008
19 December 2008
-
-
-
-
-
20,000
19 December 2008
100%
-
-
-
-
-
-
2010
2011
2012
2013
2014
2009
unissued shares under option
At the date of this report, unissued ordinary shares of the
Company under option are:
expiry date
31 December 2009
31 December 2009
31 December 2009
31 May 2010
30 June 2010
30 June 2012
16 May 2013
24 november 2018
24 november 2018
exercise Price
$0.50
$0.31
$0.16
$0.00
$2.00
$2.00
$0.00
$0.00
$1.25
Number of Shares
4,969,702
928,425
154,737
75,000
800,000
1,600,000
112,000
1,020,000
2,000,000
11,659,864
no options have been exercised by Directors or key
management personnel, and no options have lapsed, either
during or after the end of the financial year ended 30 June 2009.
options over 3,120,000 shares were issued to staff (including
key management personnel) during the financial year ended
30 June 2009. Details of vesting requirements for options issued
to key management personnel are set out on page 40 of the
Directors Report. A further 100,000 options were issued to
non-key management personnel during the financial year.
28
Analysis of movement in options – audited
the movement during the reporting period, by value, of options
over the ordinary shares in the Company held by each key
management person and each of executives and relevant group
executives is detailed below.
Value of options
Joshua Hofheimer
Justine Heath
Granted
in year
$ (a)
212,606
7,680
exercised
in year
$ (b)
-
-
Lapsed
in year
($) (c )
-
-
(a) the value of options granted in the year is the fair value of the options
calculated at grant date using the Binomial Approximation option pricing
model. the total value of the options granted is included in the table
above. this amount is allocated to remuneration over the vesting period.
(b) the value of options exercised during the year is calculated as the market
price of shares of the Company as at close of trading on the date the options
were exercised after deducting the price paid to exercise the option.
(c) the value of options that lapsed during the year represents the benefit
forgone and is calculated at the date the option lapsed using the Binomial
Approximation option pricing model assuming the performance criteria has
been achieved. no options lapsed in the year.
directors’ interests
set out below are details of the interests of the Directors at
the date of this report in the shares of the Company, rights
or options over such instruments. Interests include those held
directly and indirectly.
director
steven M skala
Adrienne e Clarke
GF Dan o’Brien
Jonathan West
Hugh M Morgan
Joshua Hofheimer
total
Total shares
30 June 2009
4,012,730
5,417,919
4,844,768
1,611,702
6,454,503
50,000
22,391,622
options over shares
30 June 2009
1,057,768
1,096,971
1,231,456
300,000
303,031
3,000,000
6,989,226
share Options
During or since the end of financial year, the Company granted
options for no consideration over unissued ordinary shares in
the Company to the following directors and key management
personnel of the Company as part of their remuneration:
Joshua Hofheimer
Joshua Hofheimer
Justine Heath
Number of
options Granted
2,000,000
exercise Price
$1.25
expiry date
24 november 2018
1,000,000
20,000
$0.00
$0.00
24 november 2018
24 november 2018
Vesting requirements
4 tranches of 500,000 options vesting at
1 July 2010, 1 July 2011, 1 July 2012, 1 July 2013
Vesting at 1 July 2010
past services, immediate vesting
All options were granted during the financial year. no options
have been granted since the end of the financial year.
Hexima Limited // 2009 AnnUAL RepoRt
InDepenDenCe DeCLARAtIon
29
Lead auditors’ independence declaration Under
section 370C of the Corporations act 2001
the Lead Auditor’s Independence Declaration is set out on
page 52 and forms part of the Directors’ Report for the ended
30 June 2009.
this report is made pursuant to a resolution of the Directors.
Mr GF dan o’brien
Director
Mr Joshua T Hofheimer
Director
Dated this 18th day of August 2009
auditors
Non-Audit Services
During the year KpMG, the Company’s auditor, has performed
certain services in addition to their statutory duties.
the Board has considered the non-audit services provided during
the year by the auditor and is satisfied that the provision of those
services during the year by the auditor is compatible with, and did
not compromise, the auditor independence requirements of the
Corporations Act 2001 for the following reasons:
à all non-audit services were subject to the corporate
governance procedures adopted by the Company and have
been reviewed by the audit committee to ensure they do
not impact the integrity and objectivity of the auditor; and
à the non-audit services provided by the auditor do
not undermine the general principles relating to
auditor independence as set out in APES 110 Code
of Ethics for Professional Accountants, as they did 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.
Details of the amount paid or payable to the auditor of the
Company, KpMG, and its related practices for audit and non-
audit services provided during the year are set out below.
Audit Services ($)
Audit of the annual financial report
Review of half year financial report
Services other than statutory audit
special grant audit
tax compliance services
Accounting Assistance
Migration services
2009
48,600
23,000
6,000
1,200
-
3,226
82,026
2008
47,000
21,000
3,000
11,100
7,000
5,765
94,865
indemnification and insurance
of Officers and auditors
no indemnities were given or insurance premiums paid during
the financial year for any person who was an auditor of the
Company. the Company has not indemnified any Directors.
During the financial year ended 30 June 2009, the Company
paid insurance premiums of $75,680 (including taxes) in respect
of Directors’ and officers’ liability and legal expenses insurance
contracts, for current and former Directors and officers of the
Company. the insurance premiums relate to:
à costs and expenses incurred by the relevant
officers in defending proceedings, whether civil or
criminal and whatever their outcome; and
à other liabilities that may arise from their position,
with the exception of conduct involving a willful
breach of duty or improper use of information
or position to gain personal advantage.
30
InCoMe stAteMents
for the year ended 30 June 2009
Revenue
Contracted research expenditure
other research & development expenditure
patent and legal expenses
Field trial expenses
Marketing & business development expenses
employee benefits expense
Depreciation expense
other expenses
results from operating activities
Financial income
Net financing income/(expenses)
Loss before income tax
Income tax expense
Loss for the period
earnings per share
Basic earnings/(loss) per share
Diluted earnings/(loss) per share
Notes
6
7
8
9
10(a)
24
24
Consolidated
($) 2009
1,045,544
(3,408,634)
(6,314,857)
(555,079)
(170,610)
(477,551)
(2,978,357)
(81,482)
(417,264)
(14,403,834)
(13,358,290)
2,082,267
2,082,267
(11,276,023)
-
(11,276,023)
Parent entity
($) 2009
1,045,544
(3,408,634)
(6,314,857)
(555,079)
(170,610)
(477,551)
(2,978,357)
(81,482)
(417,264)
(14,403,834)
(13,358,290)
2,082,267
2,082,267
(11,276,023)
-
(11,276,023)
($) 2008
1,155,504
(2,156,583)
(87,873)
(634,226)
(161,810)
(389,539)
(2,703,846)
(29,443)
(433,222)
(6,596,542)
(5,441,038)
2,411,129
2,411,129
(3,029,909)
-
(3,029,909)
(0.144)
(0.144)
(0.144)
(0.144)
(0.045)
(0.045)
the accompanying notes form part of these financial statements
Hexima Limited // 2009 AnnUAL RepoRt
BALAnCe sHeets
as at 30 June 2009
31
Current Assets
Cash and cash equivalents
Receivables
Total Current Assets
Non-Current Assets
Receivables
Investments
plant and equipment
prepaid expenses
Total Non-Current Assets
Total Assets
Current Liabilities
trade and other payables
Deferred income
employee benefits
Total Current Liabilities
Non-Current Liabilities
Deferred Income
Total Non-Current Liabilities
Total Liabilities
Net Assets
equity
share capital
Reserves
Accumulated losses
Total equity
Notes
Consolidated
($) 2009
Parent entity
($) 2009
($) 2008
11
12
12
13
14
15
16
17
16
18
18
30,200,685
333,865
30,534,550
-
-
858,814
25,000
883,814
31,418,364
1,897,439
600,000
83,430
2,580,869
-
-
2,580,869
28,837,495
30,200,685
333,865
30,534,550
332,540
22
526,252
25,000
883,814
31,418,364
1,897,439
600,000
83,430
2,580,869
-
-
2,580,869
28,837,495
35,614,053
789,465
36,403,518
-
2
261,470
-
261,472
36,664,990
1,702,207
600,000
14,085
2,316,292
600,000
600,000
2,916,292
33,748,698
57,198,035
618,975
(28,979,515)
28,837,495
57,198,035
618,975
(28,979,515)
28,837,495
51,198,035
254,155
(17,703,492)
33,748,698
the accompanying notes form part of these financial statements
32
stAteMents oF CHAnGes In eQUItY
for the year ended 30 June 2009
Consolidated
2009
opening balance at 1 July 2008
net (loss) for the period
total recognised income and expense for the period
Issue of ordinary shares
Issue of share options
Closing balance at 30 June 2009
the Company
2009
opening balance at 1 July 2008
net (loss) for the period
total recognised income and expense for the period
Issue of ordinary shares
Issue of share options
Closing balance at 30 June 2009
2008
opening balance at 1 July 2007
net (loss) for the period
total recognised income and expense for the period
Issue of ordinary shares, 27 August 2007
– on conversion of converting notes
– for cash on Initial public offering
Issue of ordinary shares on exercise of options
Issue of share options
Less: transaction costs, net of tax
Deferred tax asset in respect of transaction
costs for raising share capital not recognised
Closing balance at 30 June 2008
Note
18
18
Note
18
18
18
18
18
ordinary
Shares
$
51,198,035
-
-
6,000,000
-
57,198,035
equity option
reserve
$
200,000
-
-
-
-
200,000
ordinary
Shares
$
51,198,035
-
-
6,000,000
-
57,198,035
equity option
reserve
$
200,000
-
-
-
-
200,000
equity
compensation
reserve
$
54,155
-
-
-
364,820
418,975
equity
compensation
reserve
$
54,155
-
-
-
364,820
418,975
2,361,456
-
-
11,311,597
40,000,000
151,516
-
(1,838,574)
(787,960)
51,198,035
200,000
-
-
-
-
-
-
-
-
200,000
12,000
-
-
-
-
-
42,155
-
-
54,155
Accumulated
Losses
$
(17,703,492)
(11,276,023)
(11,276,023)
-
-
(28,979,515)
Total
equity
$
33,748,698
(11,276,023)
(11,276,023)
6,000,000
364,820
28,837,495
Accumulated
Losses
$
(17,703,492)
(11,276,023)
(11,276,023)
-
-
(28,979,515)
Total
equity
$
33,748,698
(11,276,023)
(11,276,023)
6,000,000
364,820
28,837,495
(14,673,583)
(3,029,909)
(3,029,909)
(12,100,127)
(3,029,909)
(3,029,909)
-
-
-
-
-
11,311,597
40,000,000
151,516
42,155
(1,838,574)
-
(17,703,492)
(787,960)
33,748,698
Hexima Limited // 2009 AnnUAL RepoRt
stAteMents oF CAsH FLoWs
for the year ended 30 June 2009
33
Cash Flows From operating Activities
Cash receipts from government grants
& collaboration agreements
Cash paid to suppliers and employees
net cash (used in) operating activities
Cash Flows From investing Activities
Loan to subsidiary
Interest received
payments for plant and equipment
Investment in subsidiary
net cash from investing activities
Cash Flows From Financing Activities
proceeds from issue of share capital
transaction costs relating to issue of shares
proceeds from exercise of share options
payment of loan
net cash from financing activities
net (decrease)/ increase in cash
and cash equivalents
Cash and cash equivalents at 1 July
Cash and cash equivalents at 30 June
Notes
Consolidated
($) 2009
Parent entity
($) 2009
($) 2008
487,927
(7,651,784)
(7,163,857)
487,927
(7,651,784)
(7,163,857)
675,267
(6,746,899)
(6,071,632)
-
2,534,228
(783,739)
-
1,750,489
(332,540)
2,534,228
(451,179)
(20)
1,750,489
-
-
-
-
-
-
-
-
-
-
(5,413,368)
35,614,053
30,200,685
(5,413,368)
35,614,053
30,200,685
-
1,667,118
(172,359)
1,494,759
40,000,000
(2,626,534)
151,516
(167,416)
37,357,566
32,780,693
2,833,360
35,614,053
20b
18
18
18
20a
the accompanying notes form part of these financial statements
34
notes to tHe FInAnCIAL stAteMents
For the year ended 30 June 2009
1. Reporting entity
Hexima Limited (the ‘Company’) is a Company domiciled in
Australia. the address of the Company’s registered office is
Level 5, 114 William street, Melbourne, Victoria, 3000. the
consolidated financial statements of the Company as at and for
the year ended 30 June 2009 comprises the Company and its
subsidiaries (together referred to as the ‘Group’ and individually
as ‘Group’ entities). the Group is actively engaged in the
research and development of technology for the protection and
enhancement of commercial crops, primarily to enhance their
resistance to insects and fungal pathogens.
2. Basis of Preparation
(a) Statement of compliance
the financial report is a general purpose financial report which
has been prepared in accordance with Australian Accounting
standards (AAsBs) (including Australian Interpretations)
adopted by the Australian Accounting standards Board (AAsB)
and the Corporations Act 2001. the consolidated financial
report of the Group and the financial report of the Company
comply with International Financial Reporting standards (IFRss)
and interpretations adopted by the International Accounting
standards Board (IAsB).
the financial statements were approved by the Board of
Directors on18th August 2009.
(b) basis of measurement
the financial report has been prepared on the basis of historical
cost, except for derivative financial instruments and liabilities
for cash-settled share based payment arrangements which are
measured at fair value.
(c) Functional and presentation currency
the financial statements are presented in Australian dollars,
which is the Company’s and Group’s functional currency.
(d) use of estimates and judgements
the preparation of financial statements requires management
to make judgements, estimates and assumptions that affect the
application of policies and reported amounts of assets, liabilities,
income and expenses. the estimates and associated assumptions
are based on historical experience and various other factors
that are believed to be reasonable under the circumstances,
the results of which form the basis of making the judgements
about carrying values of assets and liabilities that are not readily
apparent from other sources. Actual results may differ from
these estimates. the estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is revised and
in any future periods affected.
In particular, information about significant areas of estimation,
uncertainty and critical judgements in applying accounting
policies that have the most significant effect on the amounts
recognised in the financial statements are described in the
following note:
note 19 – measurement of share-based payments.
3. significant accounting Policies
the accounting policies set out below have been applied
consistently to all periods by Group entities.
Certain comparative amounts have been reclassified to conform
with the current year’s presentation.
(a) basis of Consolidation
Subsidiaries
subsidiaries are entities controlled by the Group. Control exists
when the Group has the power to govern the financial and
operating policies of an entity so as to obtain benefits from its
activities. In assessing control, potential voting rights that currently
are exercisable are taken into account. the financial statements
of subsidiaries are included in the consolidated financial
statements from the date that control commences until the date
that control ceases. the accounting policies of subsidiaries have
been changed when necessary to align them with the policies
adopted by the Group.
In the Company’s financial statements, investments in subsidiaries
are carried at cost.
(b) Financial instruments
(i) Non-derivative financial instruments
non-derivative financial instruments comprise trade and other
receivables, cash and cash equivalents, loans and trade and other
payables.
non-derivative financial instruments are recognised initially at fair
value plus, for instruments not at fair value through profit or loss,
any directly attributable transaction costs. subsequent to initial
recognition non-derivative financial instruments are measured as
described below.
Cash and cash equivalents comprise cash balances and call term
deposits. term deposits are classified as cash as the Group can
convert the deposits as available cash in reasonable time with
minimal break costs to the Group.
Accounting for finance income and expense is discussed in
note 3(h).
(ii) Converting notes
non-redeemable converting notes which convert to share
capital and where the number of shares issued vary with
changes in their fair value are accounted for as hybrid financial
instruments, split between host contract debt and derivative
debt. the derivative debt component embedded in hybrid
convertible notes is calculated at its fair value at the time of
recognition of the convertible notes and then fair valued on an
on-going basis with changes recognised in the profit and loss
account. Converting notes are recognised in the balance sheet
upon issue. For partly paid converting notes, a receivable is
recognised to the extent of the unpaid amount.
(iii) other non-derivative financial instruments
other non-derivative financial instruments are measured at
amortised cost using the effective interest method, less any
impairment losses.
(iv) derivative financial instruments
Separable embedded derivatives
Changes in the fair value of separable embedded derivatives are
recognised immediately in profit or loss.
Hexima Limited // 2009 AnnUAL RepoRt
35
An impairment loss is reversed if the reversal can be related
objectively to an event occurring after the impairment loss was
recognised. For financial assets measured at amortised cost, the
reversal is recognised in profit or loss.
(ii) Non-financial assets
the carrying amounts of the Group’s non-financial assets, other
than deferred tax assets, are reviewed at each reporting date
to determine whether there is any indication of impairment. If
any such indication exists then the asset’s recoverable amount is
estimated.
An impairment loss is recognised if the carrying amount of an
asset or its cash-generating unit exceeds its recoverable amount.
Impairment losses are recognised in profit or loss. Impairment
losses recognised in respect of cash-generating units reduce the
carrying amount of the other assets in the unit (group of units)
on a pro rata basis.
In respect of assets, impairment losses recognised in prior
periods are assessed at each reporting date for any indications
that the loss has decreased or no longer exists. An impairment
loss is reversed if there has been a change in the estimates
used to determine the recoverable amount. An impairment
loss is reversed only to the extent that the asset’s carrying
amount does not exceed the carrying amount that would have
been determined, net of depreciation or amortisation, if no
impairment loss had been recognised.
the recoverable amount of an asset is the greater of its fair
value and its fair value less costs to sell. In assessing value in
use, the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks
specific to the asset. For the purpose of impairment testing
assets are grouped together into the smallest group of assets
that generates cash inflows from continuing use that are largely
independent of the cash inflows of other assets or group of
assets (the ‘cash generating unit’).
(f ) revenue
Grant revenue
Government grant income that compensates the Group for
expenses incurred is recognised as revenue in the income
statement on a systematic basis in the same periods in which the
expenses are incurred.
research grants and collaboration fees
Research grants and collaboration fees represents revenue
received from entities who fund and/or participate in the
collaborative research initiatives of the Group. When services in
respect of collaborative research activities are performed by an
indeterminate number of acts over a specified period of time,
revenue is recognised on a straight line basis over the period of
the collaborative research agreement. Unrecognised revenue,
representing payments received during the year for services to
be provided in the future, is recognised as deferred income.
(v) Share capital
Ordinary shares
ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of ordinary shares and share options are
recognised as a deduction from equity, net of any related income
tax benefit. other incremental costs not attributable to issue of
ordinary shares are expensed as incurred.
Dividends
Dividends are recognised as a liability in the period in which they
are declared.
(c) Plant and equipment
(i) recognition and measurement
Items of plant and equipment are measured at cost less
accumulated depreciation and accumulated impairment losses.
Where parts of an item of plant and equipment have different
useful lives, they are accounted for as separate items of plant
and equipment. Cost includes expenditures that are directly
attributable to the acquisition of the asset.
(ii) Subsequent costs
the Company recognises in the carrying amount of an item
of plant and equipment the cost of replacing part of such an
item when that cost is incurred if it is probable that the future
economic benefits embodied within the item will flow to the
Group and the cost of the item can be measured reliably. All
other costs are recognised in the income statement as an
expense as incurred.
(iii) depreciation
Depreciation is charged to the income statement on a straight-
line basis over the estimated useful lives of each part of an item
of plant and equipment. the depreciation/amortisation rates
used for each class of asset are as follows:
plant and equipment
office equipment
2009
15% - 37.5%
33% - 66.7%
2008
15% - 37.5%
33%
Depreciation methods, useful lives and residual values are
reassessed at the reporting date.
(d) Foreign Currency
transactions in foreign currencies are translated to the functional
currency of Group entities at exchange rates at the dates of the
transactions.
(e) impairment
(i) Financial assets
A financial asset is assessed at each reporting date to determine
whether there is any objective evidence that it is impaired.
A financial asset is considered to be impaired if objective
evidence indicates that one or more events have had a negative
effect on the estimated future cash flows of that asset.
An impairment loss in respect of a financial asset measured at
amortised cost is calculated as the difference between its carrying
amount, and the present value of the estimated future cash flows
discounted at the original effective interest rate.
Individually significant financial assets are tested for impairment
on a individual basis. the remaining financial assets are assessed
collectively in groups that share similar credit risk characteristics.
All impairment losses are recognised in profit or loss.
36
(g) research expenditure
expenditure on research activities undertaken with the
prospect of gaining new scientific or technical knowledge and
understanding is recognised in the income statement as an
expense as incurred. patent costs relating to research activities
are expensed as incurred. plant and equipment acquired to
perform research activities are capitalised where the plant and
equipment are not specific in nature to the Group’s research
activities and can be sold or leased to third parties. plant and
equipment specific to the research activities of the Group are
expensed on acquisition.
(h) Finance income and expenses
Finance income comprises interest income on term deposits.
Interest income is recognised as it accrues in profit or loss, using
the effective interest method.
(i) income tax
Income tax expense comprises current and deferred tax. Income
tax expense is recognised in the profit or loss except to the
extent that it relates to items recognised directly in equity, in
which case it is recognised directly in equity.
Current tax is the expected tax payable on the taxable income
for the year, using tax rates enacted or substantively enacted at
the balance sheet date, and any adjustment to tax payable in
respect of previous years.
Deferred tax is recognised using the balance sheet method,
providing for temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes
and the amounts used for taxation purposes. Deferred tax is not
recognised for temporary differences where the initial recognition
of assets and liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit.
Deferred tax is measured at the tax rates that are expected
to be applied to the temporary differences when they reverse,
based on the laws that have been enacted or substantively
enacted by the reporting date. Deferred tax assets and liabilities
are offset if there is a legally enforceable right to offset current
tax liabilities and assets, and they relate to income taxes levied by
the same tax authority on the same taxable entity.
A deferred tax asset is recognised to the extent that it is
probable that future taxable profits will be available against
which the asset can be utilised. Deferred tax assets are reviewed
at each reporting date and are reduced to the extent that it is
no longer probable that the related tax benefit will be realised.
(j) Goods and services tax
Revenue, expenses and assets are recognised net of the amount
of goods and services tax (Gst), except where the amount of
Gst incurred is not recoverable from the taxation authority. In
these circumstances, the Gst is recognised as part of the cost of
acquisition of the asset or as part of the expense.
Receivables and payables are stated with the amount of Gst
included. the net amount of Gst recoverable from, or payable
to, the Ato is included as a current asset or liability in the
balance sheet. Cash flows are included in the statements of
cash flows on a gross basis. the Gst components of cash
flows arising from investing and financing activities which are
recoverable from, or payable to, the Ato are classified as
operating cash flows.
Hexima Limited // 2009 AnnUAL RepoRt
(k) Segment reporting
A segment is a distinguishable component of the Group that
is engaged either in providing products or services (business
segment), or in providing products and services within a
particular economic environment (geographical segment), which
is subject to risks and rewards that are different from those of
other segments.
the Group primarily operates in one sector, being the
agricultural biotechnology industry, developing and/or
commercialising agricultural biotechnology research.
the majority of operations are in Australia.
(l) employee benefits
defined contribution plans
A defined contribution plan is a post-employment benefit under
which the an entity pays fixed contributions into a separate
entity and will have no legal or constructive obligation to pay
further amounts. obligations for contributions to defined
contribution plans are recognised as a personnel expense in
profit or loss when they are due. prepaid contributions are
recognised as an asset to the extent that a cash refund or a
reduction in future payments is available.
Short term benefits
short-term employee benefit obligations are measured on an
undiscounted basis and are expensed as the related service
is provided.
A liability is recognised for the amount expected to be paid
under short-term cash bonus or profit-sharing plans if the
Group has a present legal or constructive obligation to pay this
amount as a result of past service provided by the employee and
the obligation can be estimated reliably.
Long term employee benefits
the Company’s net obligation in respect of long-term employee
benefits is the amount of future benefit that employees have
earned in return for their service in the current and prior periods
plus related on costs; that benefit is discounted to determine
its present value, and the fair value of any related assets is
deducted. the maturity discount rate is the yield at the reporting
date on AA credit-rated Commonwealth Government bonds that
have dates approximating the terms of the Group’s obligations.
(m) Share based payment transactions
equity Settled
the grant date fair value of options granted to employees is
recognised as an employee expense, with a corresponding
increase in equity over the period that the employee becomes
unconditionally entitled to the options. the amount recognised
as an expense is adjusted to reflect the actual number of share
options that vest except for those that fail to vest due to market
conditions not being met.
(n) earnings per share
the Group presents basic and diluted earnings per share (eps)
data for its ordinary shares. Basic eps is calculated by dividing
the profit or loss attributable to ordinary shareholders of the
Company by the weighted average number of ordinary shares
outstanding during the period. Diluted eps is determined by
adjusting the profit or loss attributable to ordinary shareholders
and the weighted average number of ordinary shares
outstanding for the effects of all dilutive potential ordinary shares,
which comprise convertible notes and share options issued.
37
(o) determination of fair values
A number of the Group’s accounting policies and disclosures
require the determination of fair value for both financial and non-
financial assets and liabilities. Fair values have been determined for
measurement and/or disclosure purposes based on the following
methods. Where applicable, further information about the
assumptions made in determining fair values is disclosed in the
notes specific to that asset or liability.
Share-based payment transactions
the fair value of employee share options at grant date
is measured using the Binomial Approximation option
pricing method. Measurement inputs include share price on
measurement date, exercise price of the instrument, expected
volatility (based on weighted average historic volatility adjusted
for changes expected due to publicly available information),
weighted average expected life of the instruments (based on
historical experience and general option holder behaviour),
expected dividends, and the risk-free interest rate (based on
government bonds). service and non-market performance
conditions attached to the transactions are not taken into
account in determining fair value.
research expenses
the fair value of research expenses (note 7,18) has been
measured at the Directors’ estimate of the fair value of
intellectual property rights acquired from an independent party
dealing at arm’s length.
(p) New standards and interpretations not yet adopted
the following standards, amendments to standards and
interpretations have been identified as those which may impact
the entity in the period of initial application. they are available
for early adoption at 30 June 2009, but have not been applied in
preparing this financial report:
à Revised AASB 101 Presentation of Financial Statements
(2007) introduces the term total comprehensive income,
which represents changes in equity during a period other
than those changes resulting from transactions with
owners in their capacity as owners. total comprehensive
income may be presented in either a single statement of
comprehensive income (effectively combining both the
income statement and all non-owner changes in equity in a
single statement) or, in an income statement and a separate
statement of comprehensive income. Revised AAsB 101,
which becomes mandatory for the Group’s 30 June 2010
financial statements, is expected to have a significant
impact on the presentation of the consolidated financial
statements. the Group plans to provide total comprehensive
income in a single statement of comprehensive income
for its 2010 consolidated financial statements.
à AASB 2008-1 Amendments to Australian Accounting Standard
– Share-based Payment: Vesting Conditions and Cancellations
clarifies the definition of vesting conditions, introduces
the concept of non-vesting conditions, requires non-
vesting conditions to be reflected in grant-date fair value
and provides the accounting treatment for non-vesting
conditions and cancellations. the amendments to AAsB 2
will be mandatory for the Group’s 30 June 2010 financial
statements, with retrospective application. the Group has
not yet determined the potential effect of the amendment.
4. Financial Risk management
overview
the Company has exposure to the following risks from their use
of financial instruments:
à credit risk
à liquidity risk
à market risk.
this note presents information about the Company’s and
Group’s exposure to each of the above risks, their objectives,
policies and processes for measuring and managing risk, and
the management of capital. Further quantitative disclosures are
included throughout this financial report.
the Board of Directors has overall responsibility for the
oversight of risks. the Company and the Group maintains a
control environment in which all employees understand their
roles and obligations.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer
or counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from the Group’s
receivable from the Government in respect of research grants
accrued interest receivable from the banks.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet
its financial obligations as they fall due. the Group’s approach
to managing liquidity is to ensure, as far as possible, that it will
always have sufficient liquidity to meet its liabilities when due,
under both normal and stressed conditions, without incurring
unacceptable losses or risking damage to the Group’s reputation.
the Group prepares and monitors budgets to manage its
liquidity for the short and long term.
Market risk
Market risk is the risk that changes in market prices, such as
foreign exchange rates, interest rates and equity prices will affect
the Group’s income or the value of its holdings of financial
instruments. the Board of Directors oversee market risk
exposures to optimise returns.
Currency risk
the Group’s currency risk is limited to trade and other payables
that are denominated in a currency other than the functional
currency of the Group entities, primarily Us dollar (UsD). Given
the minimal value of foreign currency transactions the Group does
not enter into contracts to hedge currency risk. At 30 June 2009,
there were no receivables denominated in foreign currencies
(2008: $nIL), however there were amounts payable of $11,636
(2008: $74,606).
interest rate risk
the Group does not have any interest expenses. Interest income
is earned on term deposits and cash at bank, which are based on
prevailing market rates.
38
Hexima Limited // 2009 AnnUAL RepoRt
Capital management
the Board’s policy is to maintain a strong capital base so as to maintain investor,
creditor and market confidence and to sustain future development of the business.
As the Company is a development stage company, the Board of Directors monitors the
Company’s performance with particular regard to the progress of scientific programs,
the commercialisation of those programs, the development of the Company’s intellectual
property and asset base and long-term share price performance. there were no changes
in the Group’s approach to capital management during the year. the Group is not
subject to externally imposed capital requirements.
5. segment Reporting
the Group primarily operates in one sector, being the agricultural biotechnology industry
developing and/or commercialising agricultural biotechnology research. the majority of
operations are in Australia.
6. Revenue
Government grants
Research grants and collaboration fees
Consolidated
($) 2009
277,659
767,885
1,045,544
Parent entity
($) 2009
277,659
767,885
1,045,544
($) 2008
455,504
700,000
1,155,504
7. Other Research and development expenditure
Note
other research and
development expenditure
Research intellectual property rights
acquired in 2009 - expensed
8. Other expenses
Administration & compliance costs
other expenses
314,857
314,857
87,873
18
6,000,000
6,314,857
6,000,000
6,314,857
-
87,873
224,738
192,526
417,264
224,738
192,526
417,264
251,143
182,079
433,222
9. Finance income and expense
Interest income on term deposit and cash at bank
Finance income
2,082,267
2,082,267
2,082,267
2,082,267
2,411,129
2,411,129
10. income tax
(a) Numerical reconciliation between tax expense and pre-tax net profit
Loss before tax
Income tax using the domestic corporation
tax rate of 30% (2008: 30%)
Increase/(decrease) in income
tax expense due to:
other non-deductible expenses
R & D concessional increment
non-deductible share based payment
non-deductible research expenses arising
from shares issued as consideration
for intellectual property rights
temporary differences not brought to account
tax losses not brought to account
Income tax expense/(benefit)
on pre-tax net profit
Consolidated
($) 2009
(11,276,023)
Parent entity
($) 2009
(11,276,023)
($) 2008
(3,029,909)
(3,382,807)
(3,382,807)
(908,972)
-
(296,528)
109,446
-
(296,528)
109,446
-
(163,971)
12,647
1,800,000
49,692
1,720,197
1,800,000
49,692
1,720,197
-
(356,350)
1,416,646
-
-
-
39
10. income tax (continued)
(b) unrecognised deferred tax assets
Deferred tax assets have not been recognised in respect of the following items:
temporary differences
tax losses
total
855,690
3,832,714
4,688,404
855,690
3,832,714
4,688,404
805,990
2,112,517
2,918,507
the deductible temporary differences and tax losses do not expire under current tax
legislation. Deferred tax assets have not been recognised in respect of these items
because it is not probable that future taxable profit will be available against which the
Group and the Company could utilise the benefits therefrom. Comparative amounts
have been restated to reflect assessed balances.
11. Cash and Cash equivalents
Cash on hand
Cash at bank
term Deposit
12. Receivables
Current
trade receivables
Accrued Interest
prepayments
Non-Current
Loan to subsidiary
2,467
631,218
29,567,000
30,200,685
2,467
631,218
29,567,000
30,200,685
3,605
672,980
34,937,468
35,614,053
2,875
292,050
38,940
333,865
2,875
292,050
38,940
333,865
42,383
744,011
3,071
789,465
-
-
332,540
332,540
-
-
the Company’s exposure to credit and currency risks and impairment losses related to
trade receivables is disclosed in note 22.
13. investments
shares in pharmagra pty Ltd (formerly
Hexima Biotech pty Ltd) - at cost
shares in Hexima Holdings pty Ltd - at cost
-
-
-
2
20
22
2
-
2
pharmagra pty Ltd is incorporated in Australia and is a 100% owned subsidiary of the
Company. pharmagra pty Ltd has total assets and net assets of $2.00 at 30 June 2009.
Hexima Holdings pty Ltd is incorporated in Australia and is a 100% owned subsidiary
of the Company. Hexima Holdings pty Ltd has total assets of $332,540 at 30 June 2009,
which comprises the glasshouse under construction at La trobe University.
14. Plant and equipment
Consolidated
Cost
Balance at 1 July 2008
Additions
Balance at 30 June 2009
Accumulated depreciation
Balance at 1 July 2008
Depreciation for the year
Balance at 30 June 2009
Carrying amounts
At 1 July 2008
At 30 June 2009
Plant and
equipment
$
266,423
675,807
942,230
office
equipment
$
74,173
3,018
77,191
48,765
59,608
108,373
217,658
833,857
30,361
21,873
52,234
43,812
24,957
Total
$
340,596
678,825
1,019,421
79,126
81,481
160,607
261,470
858,814
40
14. Plant and equipment (continued)
The Company
Cost
Balance at 1 July 2008
Additions
Balance at 30 June 2009
Balance at 1 July 2007
Additions
Balance at 30 June 2008
Accumulated depreciation
Balance at 1 July 2008
Depreciation for the year
Balance at 30 June 2009
Balance at 1 July 2007
Depreciation for the year
Balance at 30 June 2008
Carrying amounts
At 1 July 2007
At 30 June 2008
At 1 July 2008
At 30 June 2009
266,423
343,245
609,668
106,354
160,069
266,423
48,765
59,608
108,373
30,318
18,447
48,765
76,036
217,658
217,658
501,295
74,173
3,018
77,191
25,739
48,434
74,173
30,361
21,873
52,234
19,365
10,996
30,361
6,374
43,812
43,812
24,957
340,596
346,263
686,859
132,093
208,503
340,596
79,126
81,481
160,607
49,683
29,443
79,126
82,410
261,470
261,470
526,252
15. trade and Other Payables
Current
trade payables
other payables & accrued expenses
Consolidated
($) 2009
Parent entity
($) 2009
($) 2008
1,441,794
455,645
1,897,439
1,441,794
455,645
1,897,439
1,060,135
642,072
1,702,207
Included in trade payables is an amount of $nIL (2008: $28,263) in respect of key
management personnel accrued remuneration.
the Company’s exposure to currency and liquidity risk related to trade and other
payables is disclosed in note 22.
16. deferred income
Hexima has entered into a Research and Development Agreement with Balmoral
Australia pty Limited (‘Balmoral’), whereby Balmoral has paid Hexima $1,800,000 to
conduct research on its behalf for three years commencing 1 July 2007. the contract
has a term of three years expiring on 30 June 2010. In accordance with the Group’s
accounting policy in respect of collaborative research agreements, the $1,800,000
is being recognised as income over the three year collaborative research period.
Accordingly, $600,000 has been recognised as income in the year ended 30 June 2009
and deferred income of $600,000 as at 30 June 2009 represents the total income to be
earned in the coming year.
17. employee Benefits
Current
superannuation
Liability for annual leave
Consolidated
($) 2009
Parent entity
($) 2009
($) 2008
37,963
45,467
83,430
37,963
45,467
83,430
-
14,085
14,085
Hexima Limited // 2009 AnnUAL RepoRt
41
18. Capital and Reserves
Reconciliation of movement in capital and reserves
Consolidated and the Parent entity
ordinary Shares
on issue at 1 July
Issued at $1.50 per share as consideration for intellectual
property acquired for research purposes
Issued for cash
transaction costs, net of tax
Deferred tax assets relating to transaction costs not recognised
Conversion of converting notes
exercise of share options
on issue at 30 June – fully paid
Number of shares
Amount
2009
74,576,307
2008
33,224,006
2009 ($)
51,198,035
2008 ($)
2,361,456
4,000,000
-
-
-
-
-
78,576,307
-
32,000,000
-
-
9,049,270
303,031
74,576,307
6,000,0001
-
-
-
-
-
57,198,035
-
40,000,0002
(1,838,574)3
(787,960)3
11,311,5974
151,516
51,198,035
1. the $6.0 million increase in share capital for 2008/09 was a result of the
co-development and commercialisation agreement the Company entered
into on 7 August 2008 with Dupont agricultural business, pioneer Hi-Bred
International, Inc. (Dupont/pioneer), for the commercialisation of fungal
resistance technology. As part of this agreement, Hexima acquired intellectual
property rights valued at $6.0 million. As consideration, and pursuant to a
placement agreement, Hexima issued 4,000,000 ordinary shares at $1.50
per share. the financial effects of this transaction have been recorded as a
research and development expenditure of $6.0 million with a corresponding
increase in share capital.
2. the Company listed on the Australian stock exchange on 27 August 2007
and this represents the gross proceeds from the issue of shares on initial
public offering at $1.25 per share.
3. transaction costs and the tax effect of this cost arising from the initial public
offering by the Company in August 2007.
4. Converting notes liability of $11,311,597 were converted to ordinary
shares on initial public offering in August 2007 under the terms of the
converting notes. Accordingly the converting note liability was extinguished
with a corresponding increase in share capital.
Number of options
Amount
2009
2008
($) 2009
($) 2008
2,400,000
2,400,000
2,400,000
2,400,000
6,164,864
3,120,000
-
9,284,864
11,684,864
6,355,895
112,000
(303,031)
6,164,864
8,564,864
200,000
200,000
54,155
364,820
-
418,975
618,975
200,000
200,000
12,000
42,155
-
54,155
254,155
equity option reserve
on issue at 1 July
on issue at 30 June – fully paid
equity compensation reserve
on issue at 1 July
Issued as compensation
exercise of share options 1
on issue at 30 June – fully paid
Total reserve at 30 June 2009
the Company does not have authorised capital or par value in
respect of its issued shares. the holders of ordinary shares are
entitled to receive dividends as declared from time to time and
are entitled to one vote per share at meetings of the Company.
1. the options were exercised at $0.50 cash per share on 3 January 2008.
equity Compensation reserve
the equity compensation reserve represents the accumulated
amount of share options vested to key management personnel
and other personnel under compensation schemes.
equity option reserve
the equity option reserve comprises the accumulated amount
of share options issued to other parties.
42
19. share-Based Payments
the terms and conditions of the grants are as follows. All options are to be settled by physical delivery of shares.
Grant date / parties entitled
option granted to founding
investors on 2 May 2002
option granted to directors
on 14 october 2003
option granted to directors
on 14 october 2003
option granted to third parties for
R&D Collaboration on 29 June 2007
option granted to third parties for
R&D Collaboration on 29 June 2007
option granted to non-
key management personnel
on 16 May 2008
option granted to an employee
on 12 september 2008
option grant to key management
personnel on 24 november 2008
Number of
instruments
4,969,702
Vesting conditions
past services, immediate vesting
928,425
past services, immediate vesting
154,737
past services, immediate vesting
800,000
past services, immediate vesting
1,600,000
past services, immediate vesting
112,000
3 months service
100,000
Vested on 29 May 2009 and expire on 31 May 2010.
2,000,000
4 tranches of 500,000 options vesting at 1 July 2010,
1 July 2011, 1 July 2012, 1 July 2013.
Contractual
life of options
7.67 years
6.22 years
6.22 years
3 years
5 years
5 years
0.9 years
10 years
termination of employment (other than for cause) or resignation at
the request by Hexima for resignation (other than for cause) before
the First exercise Date of tranche 1 will result in 500,000 options
(tranche 1) vesting immediately. these options must be exercised within
12 months of termination of employment. For the avoidance of doubt,
the remaining unvested options will lapse at the time of the termination.
termination of employment (other than for cause) or resignation at the
request by Hexima for resignation (other than for cause) after the First
exercise Date of tranche 1 will result in the next trance of unvested
options vesting immediately. All vested options must be exercised
within 12 months of termination of employment. For the avoidance
of doubt, the remaining options which have not been accelerated
and have not vested at the time of the termination will lapse.
Vests on second anniversary (June 2010) of commencement of
employment. termination of employment (other than for cause)
or resignation as a result of a request by Hexima for resignation
(other than for cause) before the First exercise Date of 1 July 2010
will result in the options vesting immediately. the options must
be exercised within 12 months of termination of employment
past services, immediate vesting
10 years
10 years
option granted to key management
on 24 november 2008
1,000,000
option granted to key management
on 24 november 2008
total share options
20,000
11,684,864
the number and weighted average exercise prices of share options is as follows:
outstanding at 1 June
exercised during the period
Granted during the period
outstanding at 30 June
weighted average
exercise price
2009
$0.89
$nil
$0.80
$0.86
Number of
options
2009
8,564,864
-
3,120,000
11,684,864
weighted average
exercise price
2008
$0.88
$0.50
$nil
$0.89
Number of
options
2008
8,755,895
(303,031)
112,000
8,564,864
the options outstanding at 30 June 2009 have an exercise price in the range of $nil to $2 and a weighted average remaining contractual
life of 3.24 years.
the fair value of services received in return for share options granted is based on the fair value of share options granted, measured using
a binomial approximation option pricing model, incorporating the probability of the relative total shareholder return vesting condition
being met, with the following inputs:
Hexima Limited // 2009 AnnUAL RepoRt
43
Fair value of share options and assumptions
Key management personnel and employees
Fair value at grant date (weighted average)
share price (weighted average)
exercise price (weighted average)
expected volatility (weighted average volatility)
option life (expected weighted average life)
expected dividends
Risk-free interest rate (weighted average based on government bonds)
employee expenses
Current
share options granted in 2008 – equity settled
share options granted in 2009 – equity settled
total expense recognised as employee costs
2009
2008
$0.3199
$0.3199
$0.8013
78.89%
9.76 years
0.00%
3.09%
$0.8615
$0.8615
$nil
74.78%
5 years
0.00%
6.34%
Consolidated
($) 2009
Parent entity
($) 2009
($) 2008
54,333
310,487
364,820
54,333
310,487
364,820
42,155
-
42,155
20. Notes to the statement of Cashflow
20a. reconciliation of Cash
Reconciliation of cash at the end of the period (as shown in the statement of cash flows) to the related items in
the accounts is as follows:
Consolidated
($) 2009
note
Parent entity
($) 2009
($) 2008
Cash on hand and at bank
11
30,200,685
30,200,685
35,614,053
20b. reconciliation of Cash Flows From operating Activities
Cash flows from operating activities
Loss for the period
Adjustments for:
Interest received – classified as investing activity
Depreciation
equity settled share based payment expense
equity issued to Dupont
operating loss before changes to working capital
(Increase)/decrease in trade and other receivables and prepayments
Increase/(decrease) in payables and employee benefits
plant and equipment acquired on credit included in trade payables
Increase/(decrease) in deferred income
net cash from/(used in) operating activities
(11,276,023)
(11,276,023)
(3,029,909)
(2,534,228)
81,482
364,820
6,000,000
(7,363,949)
430,600
264,577
104,915
(600,000)
(7,163,857)
(2,534,228)
81,482
364,820
6,000,000
(7,363,949)
430,600
264,577
104,915
(600,000)
(7,163,857)
(1,667,118)
29,443
42,155
-
(4,625,429)
(655,244)
(154,815)
(36,144)
(600,000)
(6,071,632)
44
21. auditors’ Remuneration
Audit services
Auditors of the Company
KpMG Australia
Consolidated
($) 2009
Parent entity
($) 2009
($) 2008
Audit of the annual financial report
Review of half year financial statements
48,600
23,000
48,600
23,000
47,000
21,000
other services
Auditors of the Company
KpMG Australia
Research grant audit
tax compliance services
Migration services
Accounting assistance
6,000
1,200
3,226
-
82,026
6,000
1,200
3,226
-
82,026
3,000
11,100
5,765
7,000
94,865
22. Financial instruments
Credit risk
the carrying amount of the Group’s and the Company’s financial
assets represents the maximum credit exposure. the Group’s
maximum exposure to credit risk at 30 June was:
Loan to subsidiary
trade receivables – Government
Accrued interest on bank term deposits
Cash on hand and at bank
note
12
12
12
11
Consolidated
($) 2009
-
-
292,050
30,200,685
30,492,735
Parent entity
($) 2009
332,540
-
292,050
30,200,685
30,825,275
($) 2008
-
42,383
744,011
35,614,053
36,400,447
Cash on hand and at bank are with the national Australia Bank
and the Westpac Banking Corporation.
impairment Losses
none of the Group’s and the Company’s receivables are past
due (2008: nil) and no impairment losses have been recognised
(2008: nil).
the Group and the Company are in the development phase of
its research and development programme. the Group’s and the
Company’s income is currently limited to interest on cash and
term deposits, Australian government grants and collaborative
research agreements where income is received in advance.
Accordingly, risk of impairment losses is minimal.
Liquidity risk
the Group and the Company has no financial liabilities except
for trade and other payables with a carrying value of $1,897,439
(note 15), which are payable in cash and have a maturity of less
than 6 months.
term deposits included in cash at bank above have maturities
as follows: $6,800,000 – maturity date 13/7/09, $4,190,000 –
maturity date 11/11/09, $14,077,000 – maturity date 10/10/2009
and $4,500,000 – maturity date 12/08/09.
Currency risk
At 30 June 2009, there were no receivables denominated in
foreign currencies, however there were amounts payable of
$11,636 (2008: $74,606).
Hexima Limited // 2009 AnnUAL RepoRt
Sensitivity analysis
A 10% strengthening of the Australian dollar against the
following currencies at 30 June would have increased equity
and decreased the loss for the year by the amounts shown
below. this analysis assumes that all other variables, in particular
interest rates, remain constant. the analysis is performed on the
same basis for 2008.
30 June 2009
30 June 2008
Loss reduction (UsD$)
1,058
6,773
45
24. earnings Per share
Consolidated and the Company basic
and diluted earnings per share
the calculation of basic and diluted earnings per share at
30 June 2009 was based on a loss attributable to ordinary
shareholders of $11,276,023 (2008:$3,029,909) and a
weighted average number of ordinary shares of 78,159,869,
calculated as follows:
Loss attributable to ordinary shareholders
A 10% weakening of the Australian dollar would have increased
the loss for the year and decreased equity by $1,293 in 2009
(2008: $8,278)
Loss for the period
after income tax
($) 2009
($) 2008
11,276,023
3,029,909
weighted average number of shares used as a denominator
Number for basic earnings per share
ordinary shares
Number for diluted earnings per share
ordinary shares
78,159,869
67,916,404
78,159,869
67,916,404
instruments not included in diluted earnings
per share due to anti-dilutionary effect
Number of shares
Converting notes
share options
2009
-
11,684,864
11,684,864
2008
-
8,564,864
8,564,864
25. Related Parties
directors
the following were key management personnel of the Group
and the Company at any time during the reporting period and
unless otherwise indicated were Directors for the entire period:
executive directors
Mr Joshua t Hofheimer (Ceo)
Non-executive directors
Mr GF Dan o’Brien (Chairman)
Mr steven M skala
professor Jonathan West
Mr Hugh M Morgan
professor Adrienne e Clarke (executive Director until
30 June 2009, non-executive from 1 July 2009)
executives
professor Marilyn A Anderson
Dr Robyn L Heath
Ms Justine C Heath
interest risk
exposure to interest rate risks arises in the normal course of
the Company’s business in respect of interest income on term
deposit (note 11) and cash at bank (note 11). the weighted
average interest rate in respect of interest income in 2009 was
6.7% (2008:6.9%).
Fixed rate instruments
In respect of term deposits a 100 basis points increase in
interest rates would have decreased the loss by $313,575 (2008:
$349,375). A 100 basis points decrease in interest rates would
have increased the loss by $313,575 (2008: $349,375).
Variable rate instruments
In respect of cash at bank a 100 basis points increase in interest
rates would have decreased the loss by $8,163 (2008: $6,730).
A 100 basis points decrease in interest rates would have
increased the loss by $8,163 (2008: $6,730).
estimation of fair values
the fair value of a financial asset or a financial liability is the
amount at which the asset could be exchanged, or liability settled
in a current transaction between willing parties after allowing
for transaction costs. the carrying value of financial assets
and liabilities approximates the fair value at 30 June 2008 and
30 June 2009.
23. Contingencies
the Directors are of the opinion that provisions are not
required in respect of these matters, as it is not probable that
a future sacrifice of economic benefits will be required or the
amount is not capable of reliable measure.
Guarantee and indemnification
the Company has an Institutional Biosafety Committee (IBC)
to advise on certain aspects of the Group’s and the Company’s
field trial applications. the Group and Company has agreed
to indemnify, release and forever discharge the members of
the IBC from and against any claim or liability, incurred by the
members, arising in connection with the conduct of field trials
and related applications being undertaken by the Group and
the Company. the financial exposure from this arrangement is
expected to be nil.
46
the key management personnel compensation included in
‘employee benefits expense’ is as follows:
short term employee benefits
post employment benefits
share based payments
Consolidated
($) 2009
1,398,208
217,871
220,286
1,836,365
Parent entity
($) 2009
1,398,208
217,871
220,286
1,836,365
($) 2008
1,686,777
130,209
-
1,816,986
individual directors and executive compensation disclosures
Information regarding individual directors and executives
compensation disclosures as permitted by Corporations
Regulation 2M.3.03. is provided in the Remuneration Report
section of the Directors’ Report.
Apart from the details disclosed in this note, no Director
has entered into a material contract with the Group and the
Company since the end of the previous financial year and there
were no material contracts involving Directors’ interests existing
at year end.
options and rights over equity instruments
the movement during the reporting period in the number
of options over ordinary shares in the Company held, directly,
indirectly or beneficially, by each key management person,
including their related parties, is as follows:
2009
directors
steven M skala
Jonathan West
Hugh M Morgan
Adrienne e Clarke
GF Dan o’Brien
Joshua Hofheimer
executives
Marilyn A Anderson
Robyn L Heath
Justine Heath
2008
directors
steven M skala
Jonathan West
Hugh M Morgan
Adrienne e Clarke
GF Dan o’Brien
executives
Marilyn A Anderson
Robyn L Heath
Held at
1 July 2008
Granted as
compensation
exercised
Held at
30 June 2009
Vested during
the year
1,057,768
300,000
303,031
1,096,971
1,231,456
-
500,000
500,000
-
4,989,226
-
-
-
-
-
3,000,000
-
-
20,000
3,020,000
-
-
-
-
-
-
-
-
-
1,057,768
300,000
303,031
1,096,971
1,231,456
3,000,000
500,000
500,000
20,000
8,009,226
-
-
-
-
-
-
-
-
20,000
20,000
Held at
1 July 2007
Granted as
compensation
exercised
Held at
30 June 2008
Vested during
the year
1,057,768
300,000
303,031
1,096,971
1,231,456
500,000
500,000
4,989,226
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,057,768
300,000
303,031
1,096,971
1,231,456
500,000
500,000
4,989,226
-
-
-
-
-
-
-
-
Vested and
exercisable at
30 June 2009
1,057,768
300,000
303,031
1,096,971
1,231,456
-
500,000
500,000
20,000
5,009,226
Vested and
exercisable at
30 June 2008
1,057,768
300,000
303,031
1,096,971
1,231,456
500,000
500,000
4,989,226
Hexima Limited // 2009 AnnUAL RepoRt
47
Movement in shares
the movement during the reporting period in the number of ordinary shares in the Company held, directly, indirectly or beneficially, by
each key management person, including their related parties, is as follows:
2009
directors
steven M skala
Jonathan West
Hugh M Morgan
Adrienne e Clarke
GF Dan o’Brien
Joshua Hofheimer
executives
Marilyn A Anderson
Robyn L Heath
2008
directors
steven M skala
Jonathan West
Hugh M Morgan
Adrienne e Clarke
GF Dan o’Brien
executives
Marilyn A Anderson
Robyn L Heath
Held at
1 July 2008
Shares from
converting
notes
Shares issued
under offer
Purchases
received
on exercise
of options
Sales
Held at
30 June 2009
4,012,730
1,611,702
6,454,503
5,417,919
4,844,768
-
2,381,935
2,381,935
27,105,492
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
50,000
-
-
50,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,012,730
1,611,702
6,454,503
5,417,919
4,844,768
50,000
2,381,935
2,381,935
27,155,492
Held at
1 July 2007
Shares from
converting
notes
Shares issued
under offer
Purchases
received
on exercise
of options
Sales
Held at
30 June 2008
2,892,730
491,702
4,354,503
4,525,026
2,924,768
2,381,935
2,381,935
19,952,599
960,000
960,000
1,600,000
732,893
1,760,000
-
-
6,012,893
160,000
160,000
500,000
160,000
160,000
-
-
1,140,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,012,730
1,611,702
6,454,503
5,417,919
4,844,768
2,381,935
2,381,935
27,105,492
Changes in key management personnel in the period, after the
reporting date and prior to the date when the financial report is
authorised for issue
In July 2009, professor Marilyn Anderson was appointed to the
position of Chief science officer. professor Anderson is one of
the Company’s founders and is leading the development of the
Company’s anti-fungal protein technology within the Dupont/
pioneer partnership. she has played a critical part in developing
the Company’s Ip portfolio and is a named inventor on all of
the Company’s key patents. the former Chief science officer,
professor Adrienne Clarke, continues her contribution to the
Company in a non-executive capacity as Deputy Chairman.
Key management personnel and directors’ transactions
a) Dr Heath was an employee of the University of
Melbourne during the financial year ended 30 June
2009. During the course of the financial year ended
30 June 2009, amounts (including Gst) totaling
$2,548,580 (2008: $1,397,738) were paid or payable by
Hexima to the University of Melbourne for research work
carried out on behalf of Hexima. these transactions were
conducted on normal commercial terms. trade accounts
and/or accruals payable to the University of Melbourne
at 30 June 2009 were $454,233 (2008: $771,451).
b) Mr o’Brien is the sole director of Dromoland Capital
pty Limited. An amount (including Gst) of $171,889
(2008: $784,631) was paid or provided to be paid to this
entity during the financial year ended 30 June 2009 for
services provided to Hexima. these transactions were
conducted on normal commercial terms. this amount
includes $170,000 for the provision of Mr o’Brien’s
services as Chairman of the Company and $1,889 direct
reimbursement of identifiable expenses incurred on
the Group’s and the Company’s behalf at no margin.
c) Mr o’Brien is sole director of Leslie Manor pty Limited
(‘Leslie Manor’). An amount (including Gst) of $nIL
(2008:$8,568) was paid to this entity during the year
ended 30 June 2009. the Company reimbursed Leslie
Manor at cost for the lease of a motorbike used in
conducting the Group’s field trials. the Group and
the Company purchased the motorbike from Leslie
Manor during the year ended 30 June 2008.
d) the Company employs an executive assistant to
provide part-time support to Mr o’Brien.
48
e) professor Anderson is an employee of La trobe
g) Mr skala is a director of Wilson HtM Investment
University. During the course of the financial year
ended 30 June 2009, amounts (including Gst)
totaling $1,436,424 (2008: $1,048,030) were paid
or payable by Hexima to La trobe University for
research work carried out on behalf of the Group and
the Company. these transactions were conducted
on normal commercial terms. trade accounts and/
or accruals payable to La trobe University at
30 June 2009 were $1,432,199 (2008: $667,016).
f) Mr skala is a consultant to Arnold Bloch Leibler.
Mr skala retired as a partner of Arnold Bloch Leibler
in 2004. An amount (including Gst) of $62,816
(2008: $116,523) was paid to Arnold Bloch Leibler
during the financial year ended 30 June 2009 for
legal services (and expenses associated therewith)
provided to Hexima. these services were provided and
expenses incurred on normal commercial terms. trade
accounts and/or accruals payable to Arnold Bloch
Leibler at 30 June 2009 were $nIL (2008: $2,208).
Group Limited, who underwrote the capital raising
completed in August 2007. these services were
provided on normal commercial terms. Underwriting
fees and expense reimbursements of $nIL were paid
to Wilson HtM Investment Group during the financial
year ended 30 June 2009 (2008: $2,584,152).
h) Mr Hofheimer was previously a partner of sidley Austin
LLp before joining Hexima in June 2008. An amount
of $128,317 (2008: $170,254) was paid or payable
to sidley Austin during the year ended 30 June 2009
for legal services (and expenses associated therewith)
provided to Group and the Company. these
transactions were on normal commercial terms. trade
accounts and/or accruals payable to sidley Austin
at 30 June 2009 were $2,467 (2008: $63,471).
related Party Transactions
During the year, the Company provided an interest free loan of $332,540 to its subsidiary Hexima Holdings
pty Ltd. this loan is outstanding at 30 June 2009.
26. Capital Commitments
Capital expenditure commitments
plant and equipment
Contracted but not provided for and payable
Within one year
Consolidated
($) 2009
($) 2009
Parent entity
($) 2008
1,764,052
1,764,052
-
-
-
-
the capital commitment is in relation to the construction of a corn transformation facility, incorporating
glasshouse and laboratory space, by the Group.
27. Operating Leases
Leases as lessee
non-cancellable operating lease rentals are payable as follows:
Less than one year
Between one and five years
Consolidated
($) 2009
95,442
3,800
99,242
($) 2009
95,442
3,800
99,242
Parent entity
($) 2008
-
-
-
Hexima Limited // 2009 AnnUAL RepoRt
DIReCtoRs’ DeCLARAtIon
49
1. In the opinion of the Directors of Hexima Limited (‘the Company’):
(a) the financial statements and notes, and the Remuneration
Report in the Directors’ Report, set out on pages 18 – 29, are
in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Company’s and the
Group’s financial position as at 30 June 2009 and of their
performance, for the financial year ended on that date; and
(ii) complying with Australian Accounting standards (including the Australian
Accounting Interpretations) and the Corporations Regulations 2001;
(b) the financial report also complies with International Financial
Reporting standards as disclosed in note 2(a);
(c) there are reasonable grounds to believe that the Company will be
able pay its debts as and when they become due and payable.
2. the Directors have been given the declarations required by section 295A of
the Corporations Act 2001 from the Chief executive officer/Managing Director
and the Chief Financial officer for the financial year ended 30 June 2009.
signed in accordance with a resolution of the Directors:
Dated at Melbourne 18th day of August 2009.
Mr GF dan o’brien
Director
Mr Joshua T Hofheimer
Director
50
InDepenDent AUDItoR’s RepoRt
Hexima Limited // 2009 AnnUAL RepoRt
51
52
Hexima Limited // 2009 AnnUAL RepoRt
sHAReHoLDeR InFoRMAtIon
shareholder information set out below was applicable
as at 30 september 2009
1. distribution of equity securities
3. Unquoted equity securities
options issued
4. substantial shareholders
Name
Hugh Morgan
Robert oatley
Adrienne Clarke
GF Dan o’Brien
Clianth pty Ltd
steven skala
pioneer Hi-Bred International
Number
on issue
11,584,864
Number of
holders
16
Number Held
6,454,503
6,102,180
5,417,919
4,844,768
4,213,510
4,012,730
4,000,000
%
8.20%
7.76%
6.89%
6.16%
5.36%
5.10%
5.08%
5. Voting Rights
on a show of hands each person as a member, proxy, attorney
or representative has one vote, and on a poll each member
present or by proxy, attorney or representative has one vote for
each share held.
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
totals
No of Holders
33
239
181
313
60
826
ordinary
Shares
26,297
809,176
1,524,342
9,938,960
66,377,533
78,676,308
%
0.03
1.03
1.94
12.63
84.37
100.00
there were 13 holders of less than a marketable parcel of shares
2. twenty largest equity security holders
Name
1 Balmoral Australia pty Ltd
2 Hugh Morgan
3 Clianth pty Ltd
4 pioneer Hi-Bred International Inc.
5 Adrienne Clarke
6 Beta Gamma pty Ltd
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