AI assistant
ALTERITY THERAPEUTICS LIMITED — Interim / Quarterly Report 2008
Feb 15, 2008
34388_ffr_2008-02-15_34870175-9c02-47f0-babe-ea1dcece8eb8.zip
Interim / Quarterly Report
Open in viewerOpens in your device viewer
6-K 1 zk84869.htm Created by EDGAR Ease Plus (EDGAR Ease+) Project: F:\EDGAR Filing\Prana Biotechnology Limited\84869\a84869.eep Control Number: 84869 Rev Number: 1 Client Name: Prana Biotechnology Limited Project Name: 6-K Firm Name: Zadok-Keinan Ltd 6-K MARKER FORMAT-SHEET="Scotch Rule Top-TNR" FSL="Workstation" MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation"
SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549
MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation"
FORM 6-K
MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Default"
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934
MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation"
For the month of February 2008
MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation"
PRANA BIOTECHNOLOGY LIMITED (Name of Registrant)
MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation"
Level 2, 369 Royal Parade, Parkville, Victoria 3052 Australia (Address of principal executive offices)
MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Workstation"
Indicate by check mark whether the registrant files or will files or will file annual reports under cover of Form 20-F or Form 40-F.
MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation"
Form 20-F x Form 40-F o
MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Workstation"
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): __
MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Workstation"
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): __
MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Workstation"
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation"
Yes o No x
MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Workstation"
If Yes is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- ____________
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
This Form 6-K is being incorporated by reference into the Registrants Registration Statement on Form F-3 File No. 333-116232.
PRANA BIOTECHNOLOGY LIMITED (a development stage enterprise)
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
6-K Items
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
- Condensed Consolidated Financial Statements of Prana Biotechnology Limited and Subsidiaries (a development stage enterprise) as of December 31, 2007 and for the six months ended December 31, 2007 and 2006 and Operating and Financial Review and Prospects for the six months ended December 31, 2007 and December 31, 2006.
MARKER FORMAT-SHEET="Head Right-TNR" FSL="Default"
ITEM 1
PRANA BIOTECHNOLOGY LIMITED AND SUBSIDIARIES (a development stage enterprise) INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2007 IN AUSTRALIAN DOLLARS
MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Default"
INDEX
| Page | |
|---|---|
| CONDENSED CONSOLIDATED BALANCE SHEET | 2 |
| CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS | 3 |
| CONDENSED CONSOLIDATED CASH FLOW STATEMENT | 4 |
| CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY | 5 |
| NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | 6 |
1
PRANA BIOTECHNOLOGY LIMITED AND SUBSIDIARIES (a development stage enterprise)
CONDENSED CONSOLIDATED BALANCE SHEET (in Australian dollars, except number of shares)
| Unaudited | |||||
|---|---|---|---|---|---|
| December 31, | June 30, | ||||
| Note | 2007 | 2007 | |||
| Current Assets | |||||
| Cash and cash equivalents | 9,168,753 | 7,409,256 | |||
| Trade and other receivables | 211,047 | 96,499 | |||
| Other current assets | 384,854 | 168,539 | |||
| Total Current Assets | 9,764,654 | 7,674,294 | |||
| Non Current Assets | |||||
| Property and equipment, net of accumulated | |||||
| depreciation of A$565,588 and A$551,902 respectively | 60,989 | 47,891 | |||
| Total Non Current Assets | 60,989 | 47,891 | |||
| Total Assets | 9,825,643 | 7,722,185 | |||
| Current Liabilities | |||||
| Trade and other payables | 1,897,227 | 1,661,609 | |||
| Provisions | 85,924 | 77,465 | |||
| Total Current Liabilities | 1,983,151 | 1,739,074 | |||
| Non-Current Liabilities | |||||
| Other financial liabilities | 7 | 2,179,425 | 321,001 | ||
| Provisions | 66,356 | 49,915 | |||
| Total Non-Current Liabilities | 2,245,781 | 370,916 | |||
| Total Liabilities | 4,228,932 | 2,109,990 | |||
| Commitments and Contingencies | 5 | ||||
| Net Assets | 5,596,711 | 5,612,195 | |||
| Equity | |||||
| Issued and unissued capital | |||||
| December 31, 2007: 181,600,062 fully paid | |||||
| ordinary shares | |||||
| June 30, 2007: 151,517,978 fully paid ordinary | |||||
| shares | 8 | 62,164,415 | 53,988,412 | ||
| Reserves | 9 | 6,007,884 | 4,106,821 | ||
| Accumulated deficit during the development stage | (62,575,588 | ) | (52,483,038 | ) | |
| Total Equity | 5,596,711 | 5,612,195 |
MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Default"
The accompanying notes are an integral part of the condensed consolidated financial statements.
2
PRANA BIOTECHNOLOGY LIMITED AND SUBSIDIARIES (a development stage enterprise)
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (in Australian dollars, except number of shares) (Unaudited)
| Note | 2007 | 2006 | |||
|---|---|---|---|---|---|
| Revenue | 253,876 | 236,869 | |||
| Research and development expenses | (3,642,796 | ) | (2,617,441 | ) | |
| Personnel expenses | (3,404,550 | ) | (2,178,272 | ) | |
| Intellectual property expenses | (235,534 | ) | (236,989 | ) | |
| Auditor and accounting fees | (207,627 | ) | (87,182 | ) | |
| Travel expenses | (113,574 | ) | (157,951 | ) | |
| Public relations and marketing expenses | (68,276 | ) | (139,847 | ) | |
| Depreciation expenses | (13,686 | ) | (30,226 | ) | |
| Other expenses | (508,778 | ) | (540,752 | ) | |
| Foreign exchange loss | (293,180 | ) | (381,103 | ) | |
| Loss on fair valuation of financial liabilities | 7 | (1,858,425 | ) | (1,662,719 | ) |
| Loss before income tax expense | (10,092,550 | ) | (7,795,613 | ) | |
| Income tax expense | - | - | |||
| Loss for the period | (10,092,550 | ) | (7,795,613 | ) | |
| Loss per share (basic and diluted) (cents) | (6.18 | ) | (5.94 | ) | |
| Weighted average number of ordinary shares used in | |||||
| computing basic and diluted net loss per share | 163,373,104 | 131,180,788 |
MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Default"
The accompanying notes are an integral part of the condensed consolidated financial statements.
3
PRANA BIOTECHNOLOGY LIMITED AND SUBSIDIARIES (a development stage enterprise)
CONDENSED CONSOLIDATED CASH FLOW STATEMENT (in Australian dollars) (Unaudited)
| 2007 | 2006 | |||
|---|---|---|---|---|
| Cash Flows from Operating Activities | ||||
| Payments to suppliers and employees | (6,221,635 | ) | (6,148,092 | ) |
| Interest received | 198,853 | 232,462 | ||
| Net cash flows used in operating activities | (6,022,782 | ) | (5,915,630 | ) |
| Cash Flows from Investing Activities | ||||
| Payments for purchase of equipment | (26,782 | ) | (3,657 | ) |
| Proceeds from sale of equipment | - | 300 | ||
| Net cash flows used in investing activities | (26,782 | ) | (3,357 | ) |
| Cash Flows from Financing Activities | ||||
| Proceeds from issue of shares and options | 8,486,929 | 7,783,485 | ||
| Payment of share issue costs | (374,783 | ) | (382,587 | ) |
| Net cash flows provided by financing | ||||
| activities | 8,112,146 | 7,400,898 | ||
| Net increase in cash and cash equivalents | 2,062,582 | 1,481,911 | ||
| Opening cash and cash equivalents brought | ||||
| forward | 7,409,256 | 10,013,778 | ||
| Exchange rate adjustments on the balance | ||||
| of cash and cash equivalents held in | ||||
| foreign currencies | (303,085 | ) | 35,454 | |
| Closing cash and cash equivalents carried | ||||
| forward | 9,168,753 | 11,531,143 |
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
The accompanying notes are an integral part of the condensed consolidated financial statements.
4
PRANA BIOTECHNOLOGY LIMITED AND SUBSIDIARIES (a development stage enterprise)
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (in Australian dollars, except number of shares)
| Balance, June 30, 2005 | 127,319,260 | 45,838,897 | 2,447,996 | (29,750,124 | ) | 18,536,769 | ||
|---|---|---|---|---|---|---|---|---|
| Net loss | - | - | - | (11,590,594 | ) | (11,590,594 | ) | |
| Non-cash issuance of shares to consultants | 825,000 | 435,230 | - | - | 435,230 | |||
| Non-cash issuance of options to consultants | - | - | 181,550 | - | 181,550 | |||
| Non-cash issuance of options to directors and employees | - | - | 76,470 | - | 76,470 | |||
| Amortization of option expenses | - | - | 161,233 | - | 161,233 | |||
| Balance, June 30, 2006 | 128,144,260 | 46,274,127 | 2,867,249 | (41,340,718 | ) | 7,800,658 | ||
| Net loss | - | - | - | (11,142,320 | ) | (11,142,320 | ) | |
| Issuance of shares in connection with private placement, | ||||||||
| net of issue costs | 22,014,468 | 6,108,868 | - | - | 6,108,868 | |||
| Issuance of options in connection with private placement | - | 1,262,339 | - | - | 1,262,339 | |||
| Non-cash issuance of shares to consultants | 481,250 | 194,579 | - | - | 194,579 | |||
| Non-cash issuance of shares to employees | 120,000 | 45,600 | - | - | 45,600 | |||
| Non-cash issuance of options to consultants | - | - | 163,701 | - | 163,701 | |||
| Non-cash issuance of options to directors and employees | - | - | 989,721 | - | 989,721 | |||
| Issuance of shares in connection with exercise of options, | ||||||||
| net of costs | 758,000 | 102,899 | (106,739 | ) | - | (3,840 | ) | |
| Amortization of option expenses | - | - | 195,839 | - | 195,839 | |||
| Options forfeited | - | - | (2,950 | ) | - | (2,950 | ) | |
| Balance, June 30, 2007 | 151,517,978 | 53,988,412 | 4,106,821 | (52,483,038 | ) | 5,612,195 | ||
| Net loss | - | - | - | (10,092,550 | ) | (10,092,550 | ) | |
| Issuance of shares in connection with private placement, | ||||||||
| net of issue costs | 29,778,699 | 6,496,404 | - | - | 6,496,404 | |||
| Issuance of options in connection with private placement | - | 1,439,305 | - | - | 1,439,305 | |||
| Non-cash issuance of shares to consultants | 303,385 | 88,971 | - | - | 88,971 | |||
| Non-cash issuance of options to consultants | - | - | 169,276 | - | 169,276 | |||
| Equity to be issued | - | 151,323 | 1,568,951 | - | 1,720,274 | |||
| Amortization of option expenses | - | - | 162,836 | - | 162,836 | |||
| Balance, December 31, 2007 | 181,600,062 | 62,164,415 | 6,007,884 | (62,575,588 | ) | 5,596,711 |
MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Default"
The accompanying notes are an integral part of the condensed consolidated financial statements.
5
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in Australian dollars)
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 1: Background
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
Prana Biotechnology Limited and its controlled entities: Prana Biotechnology Inc. and Prana Biotechnology UK Limited (referred to collectively as Prana or the consolidated entity), is a development stage enterprise engaged in the research and development of therapeutic drugs designed to treat the underlying cause of degeneration of the brain and the eye as the aging process progresses. Prana Biotechnology Limited (the Company), the parent entity was incorporated on November 11, 1997 in Melbourne, Australia. The U.K. and U.S. subsidiaries were incorporated in August 2004.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 2: Basis of Preparation
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The general purpose financial report for the interim six months reporting period ended December 31, 2007 has been prepared in accordance with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001. Accounting Standards include Australian equivalents to International Financial Reporting Standards (A-IFRS). This interim financial report complies with both International Financial Reporting Standards, as issued by the International Accounting Standards Board, and A-IFRS.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
This interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended June 30, 2007 and any public announcements made by Prana Biotechnology Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Going Concern
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The consolidated entity is a development stage medical biotechnology company and as such, expects to be utilizing cash until its research activities have become marketable. As at December 31, 2007, the consolidated entity has accumulated losses of A$62,575,588 and has incurred negative cash flows from operations of A$6,022,782 in the six months ended December 31, 2007. The consolidated entity has however experienced an increase in its cash position from A$7,409,256 at June 30, 2007 to A$9,168,753 at December 31, 2007 as a result of a A$8.4 million capital raising, before cost.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The directors believe that the going concern basis of preparation is appropriate given the following reasons:
MARKER FORMAT-SHEET="Para Large Hang Lv 1-TNR" FSL="Workstation"
Since inception, the consolidated entity has been able to raise funds to pursue its research programs. To date, the consolidated entity has raised A$72m through the issue of equity and grant of warrants, before costs. The directors believe that there is a reasonable expectation that they can raise additional funding to enable the consolidated entity to continue to pursue its current business objectives.
MARKER FORMAT-SHEET="Para Large Hang Lv 1-TNR" FSL="Workstation"
Having carefully assessed the uncertainties relating to the likelihood and timing of securing additional funding and the consolidated entitys ability to meet contractual commitments and effectively manage discretional expenditure, the directors believe that the consolidated entity will continue to operate as a going concern for the foreseeable future and therefore that is appropriate to prepare the financial statements on a going concern basis.
MARKER FORMAT-SHEET="Para Large Hang Lv 1-TNR" FSL="Workstation"
At this time, the directors are of the opinion that no asset is likely to be realized for an amount less than the amount at which it is recorded in the Balance Sheet at December 31, 2007. Accordingly, no adjustments have been made to the financial report relating to the recoverability and classification of the asset carrying amounts or the classification of liabilities that might be necessary should the consolidated entity not continue as a going concern.
6
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 3: Dividends
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The Company did not declare any dividends in the six months ended December 31, 2007.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 4: Segment Information
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The consolidated entitys activities are predominately within Australia and cover research into Alzheimers disease and other major age-related degenerative disorders.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 5: Contingent Liabilities
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
There has been no change in contingent liabilities since the last annual reporting date.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 6: Subsequent Events
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
There have been no events after the reporting date that have a material effect on this report.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Default"
Note 7: Financial Liabilities
| December 31, 2007 | June 30, 2007 | |||
|---|---|---|---|---|
| No. | $ | No. | $ | |
| Warrants for ADRs | ||||
| (1 ADR = 10 Ordinary Shares) | 3,000,000 | 2,179,425 | 3,000,000 | 321,001 |
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
Following a meeting of shareholders on June 1, 2004, the Company issued 4 million ADRs (1 ADR = 10 ordinary shares) and granted 3 million warrants to U.S. investors. The U.S. investors acquired the ADRs at a price of USD$5.00 per ADR with a 3 for 4 attaching warrant. This offering raised USD$20million (AUD 28.9million) before costs. The warrants are exercisable for ADRs on or before June 4, 2009 at an exercise price of USD$8.00 per warrant.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
Under AASB 132 para 11, the warrants associated with this transaction are required to be classified as a financial liability, as opposed to equity, as a result of the warrants being exercisable in a foreign currency, that is a currency, different to the functional currency of the Company.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
During 2005, the International Financial Reporting Interpretations Committee (IFRIC) noted that based on the existing wording of IAS 32 (the International Financial Reporting Standards equivalent to AASB 132), any contracts entered into by an entity to exchange a fixed number of its own equity instruments for a fixed amount of cash that is denominated in a foreign currency is a financial liability and not an equity instrument. The IFRIC discussed and questioned whether this was the appropriate and intended outcome of the standard, and consequently submitted a proposal to the International Accounting Standards Board (IASB) to amend IAS 32. As the IASB declined to make any such amendment to the standard, the IFRIC conclusion that instruments as described above should be classified as financial liabilities continues to stand.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
As a consequence, on initial recognition the fair value of the warrants is required to be recognized as a financial liability at their fair value, reducing the Issued Capital recorded. Each reporting date the financial liability representing the warrants is required to be revalued to fair value with the movement in the fair value recorded in the Statement of Operations.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
For the six months ended December 31, 2007, a loss on fair valuation of financial liabilities of $1,858,425 (December 2006: $1,662,719) has been recorded in the Statement of Operations.
7
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 7: Financial Liabilities continued
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The classification of these instruments is for accounting purposes only. In this regard, the Company has an obligation to issue equity, via ADRs, to the warrant holders should they decide to exercise their warrants upon payment of USD$8.00 per ADR. The holders of the warrants cannot force the Company to settle the contracts in cash. The classification of the warrants as liabilities, does not impact on the Companys future liquidity requirements or ability to continue as a going concern.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Default"
Note 8: Issued and Unissued Capital
| December 31, 2007 | June 30, 2007 | |||
|---|---|---|---|---|
| No. | $ | No. | $ | |
| Fully paid ordinary shares | 181,600,062 | 59,462,771 | 151,517,978 | 52,726,073 |
| Options for ordinary shares | 14,279,133 | 2,701,644 | 4,352,893 | 1,262,339 |
| Total issued and unissued | ||||
| capital | 62,164,415 | 53,988,412 |
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
During the six months ended December 31, 2007, the following changes in Issued and Unissued Capital occurred:
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Shares * Issue of 29,778,699 ordinary shares as part of a capital raising * Issue of 303,385 ordinary shares to a consultant
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Options * Grant of options to purchase 9,926,240 ordinary shares as part of a capital raising
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Default"
Note 9: Reserves Share-Based Payments
| No. | $ | No. | $ | |
|---|---|---|---|---|
| Options for fully paid ordinary shares | 8,092,246 | 4,038,887 | 9,928,262 | 2,137,824 |
| Options for ADRs | 380,000 | 1,515,434 | 380,000 | 1,515,434 |
| Warrants for ADRs | ||||
| (1 ADR = 10 ordinary shares) | 320,000 | 453,563 | 320,000 | 453,563 |
| Total Reserves - share-based payments | 6,007,884 | 4,106,821 |
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The share-based payment reserve arises on the grant of options and/or issuance of warrants to directors, executives, consultants or employees. Amounts are transferred out of the reserve and into issued and unissued capital when the options and/or warrants are exercised.
8
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 10: Activity of Equity Granted to Directors, Employees and Consultants
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
The following table summarizes the activity of share options granted to directors and employees under the 2004 Employees, Directors and Consultants Share and Option Plan (adopted on November 17, 2004) during the half-years ended December 31, 2007 and December 31, 2006.
| No of Options | Weighted average exercise price (A$) | No of Options | Weighted average exercise price (A$) | |||
|---|---|---|---|---|---|---|
| Outstanding at the beginning of the period | 8,833,978 | 0.03 | 4,327,500 | 0.06 | ||
| Granted | - | - | 3,645,500 | - | ||
| Exercised | - | - | (95,000 | ) | - | |
| Forfeited | (2,000,000 | ) | - | (150,000 | ) | - |
| Expired | (500,000 | ) | 0.50 | - | - | |
| Outstanding at the end of the period (a) | 6,333,978 | - | 7,728,000 | 0.03 | ||
| Exercisable at the end of the period (b) | 1,250,000 | - | 850,500 | 0.29 |
MARKER FORMAT-SHEET="Para (List) Hang LV 1-TNR" FSL="Workstation"
(a) The options to purchase 6,333,978 ordinary shares outstanding as at December 31, 2007 have an exercise price of A$nil, a weighted average remaining term of three years and a weighted average intrinsic value of A$0.505.
MARKER FORMAT-SHEET="Para (List) Hang LV 1-TNR" FSL="Workstation"
(b) The options to purchase 1,250,000 ordinary shares exercisable as of December 31, 2007 have an exercise price of A$nil, a remaining average term of six years and six months and a weighted average intrinsic value of A$0.505.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
The weighted average grant date fair value of the options granted to directors and employees under the 2004 Employees, Directors and Consultants Share and Option Plan during the six months ended December 31, 2006 is A$0.36. The fair value was estimated at the date of the grant using the Barrier option pricing model (as the options had market conditions), with the following weighted average assumptions:
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
risk-free interest rate of 6%
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
no dividends
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
expected volatility of 100.87%
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
expected life of two years
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Workstation"
Risk free interest rate This is the government bond rate (having a term that most closely resembles the expected life of the option) in effect at the grant date. The Australian government bond rate has been used for options exercisable for ordinary shares and the U.S. government bond rate has been used for options exercisable for ADRs.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Workstation"
Dividend yield Prana has never declared or paid dividends on its ordinary shares and does not anticipate paying any dividends in the foreseeable future.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Workstation"
Expected volatility Prana estimates expected volatility based on historical volatility over the estimated life of the option and other factors.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Workstation"
Expected life This is the period of time that the options granted are expected to remain outstanding. This estimate is based primarily on the historical trend of option holders to exercise their option near the date of expiry. As a result, the expected life is considered to equal the period from grant date to expiry date.
9
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
Note 10: Activity of Equity Granted to Directors, Employees and Consultants continued
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
The following table summarizes the activity of share options granted to directors under the 2004 ADS Option Plan (adopted on November 17, 2004) during the half-years ended December 31, 2007 and 2006. Each option is exercisable for one ADR which equals ten shares.
| No of ADRs | Weighted average exercise price (US$) | No of ADRs | Weighted average exercise price (US$) | |
|---|---|---|---|---|
| Outstanding at the beginning of the period | 380,000 | 5.00 | 380,000 | 5.00 |
| Granted | - | - | - | - |
| Exercised | - | - | - | - |
| Forfeited | - | - | - | - |
| Expired | - | - | - | - |
| Outstanding at the end of the period (c) | 380,000 | 5.00 | 380,000 | 5.00 |
| Exercisable at the end of the period (c) | 380,000 | 5.00 | 380,000 | 5.00 |
MARKER FORMAT-SHEET="Para (List) Hang LV 1-TNR" FSL="Workstation"
(c) All options to purchase 380,000 ADRs outstanding and exercisable as at December 31, 2007 have an exercise price of US$5.00, a remaining weighted average remaining contractual life of five years and a weighted average intrinsic value of A$nil.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The methodology for developing each of the assumptions is the same as that described above.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
The following table summarizes the activity of share options granted to consultants during the half-years ended December 31, 2007 and 2006.
| No of Options | Weighted average exercise price (A$) | No of Options | Weighted average exercise price (A$) | ||
|---|---|---|---|---|---|
| Outstanding at the beginning of the period | 1,094,284 | 0.27 | 1,425,000 | 0.50 | |
| Granted | 1,263,984 | 0.36 | - | - | |
| Exercised | - | - | - | - | |
| Forfeited | - | - | - | - | |
| Expired | (600,000 | ) | 0.50 | - | - |
| Outstanding at the end of the period (d) | 1,758,268 | 0.24 | 1,425,000 | 0.50 | |
| Exercisable at the end of the period (e) | 1,343,984 | 0.34 | 1,425,000 | 0.50 |
MARKER FORMAT-SHEET="Para (List) Hang LV 1-TNR" FSL="Default"
(d) Of the options to purchase 1,758,268 ordinary shares outstanding as at December 31, 2007, options to purchase 494,284 ordinary shares have an exercise price of A$nil, a weighted average remaining term of one year and three months and a weighted average intrinsic value of A$0.14. Options to purchase 400,000 ordinary shares have an exercise price of A$0.285, a weighted average remaining term of three months and a weighted average intrinsic value of A$0.05. Options to purchase 431,992 ordinary shares have an exercise price of A$0.37, a weighted average remaining term of eight months and a weighted average intrinsic value of A$0.03. The remaining options to purchase 431,992 ordinary shares have an exercise price of A$0.43, a weighted average remaining term of eight months and a weighted average intrinsic value of A$0.02. The weighted average remaining contractual life of the outstanding options to purchase 1,758,268 ordinary shares is three years.
10
Note 10: Activity of Equity Granted to Directors, Employees and Consultants continued
MARKER FORMAT-SHEET="Para (List) Hang LV 1-TNR" FSL="Workstation"
(e) Of the options to purchase 1,343,984 ordinary shares exercisable as of December 31, 2007, options to purchase 80,000 ordinary shares have an exercise price of A$nil, a remaining weighted average term of five months and a weighted average intrinsic value of A$0.03. Options to purchase 400,000 ordinary shares have an exercise price of A$0.285, a remaining weighted average term of three months and a weighted average intrinsic value of A$0.07. Options to purchase 431,992 ordinary shares have an exercise price of A$0.37, a remaining weighted average term of eleven months and a weighted average intrinsic value of A$0.04. The remaining options to purchase 431,992 ordinary shares have an exercise price of A$0.43, a remaining weighted average term of eleven months and a weighted average intrinsic value of A$0.02. The weighted average remaining contractual life of the outstanding options to purchase 1,343,984 ordinary shares is two years and six months.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
The weighted average measurement date fair value of the options granted to consultants during the six months ended December 31, 2007 is A$0.13. The fair value was estimated at the measurement date using the Black-Scholes option pricing model, with the following weighted average assumptions:
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
risk-free interest rate of 6.62% for December 31, 2007
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
no dividends
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
expected volatility of 77% for December 31, 2007
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
expected life of two and six months for December 31, 2007
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The methodology for developing each of the assumptions is the same as that described above.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
During the six months ended December 31, 2006, the Company granted unlisted options to purchase 4,352,893 ordinary shares to investors as part of a capital raising with an exercise price of A$0.446 and a weighted average remaining term of three years. None of such options have been exercised.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
During the six months ended December 31, 2007, the Company granted unlisted options to purchase 9,926,240 ordinary shares to investors as part of a capital raising, half of which have an exercise price of A$0.37 and a weighted average remaining term of three years and half of which have an exercise price of A$0.43 and a weighted average remaining term of three years. None of such options have been exercised.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
During the six months ended December 31, 2006, the Company issued 95,000 ordinary shares to employees as a result of the exercise of options under the 2004 ASX Plan, with a weighted average grant date fair value of A$0.415. No shares were issued to employees in the six months ended December 31, 2007.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
During the six months ended December 31, 2007, the Company issued 303,385 shares to a consultant under the 2004 ASX Plan, with a weighted average grant date fair value of A$0.29.
11
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
Note 10: Activity of Equity Granted to Directors, Employees and Consultants continued
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
The following table summarizes the activity of warrants granted to consultants during the six months ended December 31, 2007 and 2006:
| Number of warrants | Weighted average exercise price (USD$) | Number of warrants | Weighted average exercise price (USD$) | |
|---|---|---|---|---|
| Outstanding at the beginning of the | ||||
| period | 320,000 | 8.00 | 320,000 | 8.00 |
| Granted | - | - | - | - |
| Exercised | - | - | - | - |
| Forfeited | - | - | - | - |
| Expired | - | - | - | - |
| Outstanding at the end of the period (f) | 320,000 | 8.00 | 320,000 | 8.00 |
| Exercisable at the end of the period (f) | 320,000 | 8.00 | 320,000 | 8.00 |
MARKER FORMAT-SHEET="Para (List) Hang LV 1-TNR" FSL="Workstation"
(f) The outstanding warrants to purchase 320,000 ordinary shares are exercisable as of December 31, 2007, with an exercise price of USD$8.00, a remaining term of one year and six months and a weighted average intrinsic value of A$nil.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
Warrants to purchase an aggregate 3,000,000 ordinary shares were granted as part of the June 2004 capital raising. The warrants are exercisable on or before June 4, 2009 at an exercise price of USD$8.00. Each of these warrants are exercisable for one ADR, which is equal to ten ordinary fully paid shares. These warrants have been treated as financial liabilities, see Note 7.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
At December 31, 2007 there were outstanding options that could not be exercised until the share price reached:
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
A$1.00 for at least five consecutive trading days
MARKER FORMAT-SHEET="Para Flush Lv 2-TNR" FSL="Workstation"
The Company has made the assumption that this market condition will not be reached until June 30, 2010. As a result, the expense related to these options is being recognized over the period from date of grant until June 30, 2010, a weighted average period of five years. At December 31, 2007 there was A$478,527 of total unrecognized compensation cost related to these awards yet to be expensed.
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
A$0.80 for at least five consecutive trading days
MARKER FORMAT-SHEET="Para Flush Lv 2-TNR" FSL="Workstation"
The Company has made the assumption that this market condition will not be reached until June 30, 2009. As a result, the expense related to these options is being recognized over the period from date of grant until June 30, 2009, a weighted average period of two and six months. At December 31, 2007 there was A$486,930 of total unrecognized compensation cost related to these awards yet to be expensed.
MARKER FORMAT-SHEET="Para Hang Lv 1-TNR" FSL="Workstation"
A$0.50 for at least five consecutive trading days
MARKER FORMAT-SHEET="Para Flush Lv 2-TNR" FSL="Workstation"
The Company made the assumption that this market condition would not be reached until December 31, 2007. As a result, the expense related to these options was recognized over the period from date of grant until December 31, 2007, a weighted average period of nine months. At December 31, 2007 there was no further compensation cost related to these awards to be expensed.
12
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 11: Cumulative information
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation"
The following additional disclosures of cumulative information have been prepared under AIFRS.
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
Cumulative consolidated statement of operations from the inception of the development stage (November 11, 1997) to December 31, 2007 A-IFRS basis:
| Revenue | 3,334,095 | |
|---|---|---|
| Other income | 6,657,232 | |
| Research and development expenses | (32,225,633 | ) |
| Research and development expenses - related party | (2,289,419 | ) |
| Personnel expenses | (22,783,382 | ) |
| Intellectual property expenses | (6,414,304 | ) |
| Auditor and accounting fees | (1,364,978 | ) |
| Travel expenses | (1,855,917 | ) |
| Public relations and marketing expenses | (1,561,694 | ) |
| Depreciation expenses | (581,240 | ) |
| Amortization expenses | (461,760 | ) |
| Other expenses | (6,258,875 | ) |
| Other expenses - related party | (1,000,048 | ) |
| Foreign exchange loss | (1,627,547 | ) |
| Impairment of intangible assets | (786,240 | ) |
| Gain on fair value of financial liabilities | 6,644,122 | |
| Loss before income tax expense | (62,575,588 | ) |
| Income tax expense | - | |
| Loss for the period | (62,575,588 | ) |
13
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 11: Cumulative information continued
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
Cumulative consolidated cash flow statement form the inception of the development stage (November 11, 1997) to December 31, 2007 A-IFRS basis:
| Cash Flows from Operating Activities | ||
| Payments to suppliers and employees | (61,701,704 | ) |
| Payments to suppliers and employees - related party | (2,531,889 | ) |
| Interest received | 3,231,424 | |
| Government grant received | 3,354,228 | |
| NASDAQ reimbursements received | 231,304 | |
| Neuroscience Victoria monies received | 3,093,750 | |
| Net cash flows used in operating activities | (54,322,887 | ) |
| Cash Flows from Investing Activities | ||
| Proceeds from sale of equipment | 675 | |
| Payments for purchase of equipment | (443,956 | ) |
| Net cash flows used in investing activities | (443,281 | ) |
| Cash Flows from Financing Activities | ||
| Proceeds from issue of shares and options | 63,124,980 | |
| Payment of share issue costs | (4,452,618 | ) |
| Proceeds from exercise of options | 9,812,471 | |
| Payment for underwriting costs | (144,000 | ) |
| Repayment of borrowings | (2,038,728 | ) |
| Net cash flows provided by financing activities | 66,302,105 | |
| Net decrease in cash and cash equivalents | 11,535,937 | |
| Opening cash and cash equivalents brought forward | - | |
| Exchange rate adjustments on cash and cash equivalents held in | ||
| foreign currencies | (2,367,184 | ) |
| Closing cash and cash equivalents carried forward | 9,168,753 |
14
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
Note 11: Cumulative information continued
MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default"
Equity issuances from the inception of the development stage (November 11, 1997) to December 31, 2007 A-IFRS basis:
| Date | Balance, November 11, 1997 (Inception) | - | - |
|---|---|---|---|
| November 11, 1997 | Issuance of shares to founders | 20 | 20 |
| Balance, June 30, 1998 | 20 | 20 | |
| Balance, June 30, 1999 | 20 | 20 | |
| December 23, 1999 | 297 for 1 share split | 5,920 | - |
| June 1, 2000 | Issuance of shares in connection with private | ||
| placement | 960 | 960 | |
| July 1, 2000 | 5,000 for 1 share split | 34,493,100 | - |
| Issuance of shares in connection with initial public | |||
| offering, net of issue costs | 16,000,000 | 7,470,863 | |
| Issuance of shares in connection with exercise of | |||
| options | 5,000 | 2,500 | |
| Balance, June 30, 2000 | 50,505,000 | 7,474,343 | |
| February 15, 2001 | Issuance of shares in connection with private | ||
| placement, net of issue costs | 6,666,666 | 4,745,599 | |
| April 4, 2001 | Non-cash issuance of shares to consultants | 50,000 | 20,000 |
| June 27, 2001 | Non-cash issuance of shares to consultants | 38,600 | 28,950 |
| Balance, June 30, 2001 | 57,260,266 | 12,268,892 | |
| February 4, 2002 | Issuance of shares in connection with exercise of | ||
| options | 134,000 | 67,000 | |
| February 12, 2002 | Issuance of shares in connection with exercise of | ||
| options | 2,000 | 1,000 | |
| February 22, 2002 | Issuance of shares in connection with exercise of | ||
| options | 76,000 | 38,000 | |
| February 27, 2002 | Issuance of shares in connection with exercise of | ||
| options | 40,000 | 20,000 | |
| March 6, 2002 | Issuance of shares in connection with exercise of | ||
| options | 90,000 | 45,000 | |
| March 8, 2002 | Non-cash issuance of shares to consultants | 164,835 | 115,384 |
| March 8, 2002 | Non-cash issuance of shares to consultants | 26,959 | 28,846 |
| March 12, 2002 | Issuance of shares in connection with exercise of | ||
| options | 82,690 | 41,346 | |
| March 12, 2002 | Issuance of shares in connection with exercise of | ||
| options | 190,000 | 95,000 | |
| March 14, 2002 | Issuance of shares in connection with exercise of | ||
| options | 10,000 | 5,000 | |
| March 20, 2002 | Issuance of shares in connection with exercise of | ||
| options | 12,000 | 6,000 |
15
Note 11: Cumulative information continued
| March 21, 2002 | Issuance of shares in connection with exercise of — options | 100,000 | 50,000 |
|---|---|---|---|
| March 25, 2002 | Issuance of shares in connection with exercise of | ||
| options | 3,000 | 1,500 | |
| April 9, 2002 | Issuance of shares in connection with exercise of | ||
| options | 8,000 | 4,000 | |
| April 9, 2002 | Issuance of shares in connection with exercise of | ||
| options | 24,500 | 12,250 | |
| April 10, 2002 | Issuance of shares in connection with exercise of | ||
| options | 2,500 | 1,250 | |
| April 11, 2002 | Issuance of shares in connection with exercise of | ||
| options | 2,500 | 1,250 | |
| April 11, 2002 | Issuance of shares in connection with exercise of | ||
| options | 100,000 | 50,000 | |
| May 10, 2002 | Issuance of shares in connection with exercise of | ||
| options | 100,000 | 50,000 | |
| May 23, 2002 | Issuance of shares in connection with exercise of | ||
| options | 180,000 | 90,000 | |
| June 16, 2002 | Issuance of shares in connection with exercise of | ||
| options | 3,500 | 1,750 | |
| Balance, June 30, 2002 | 58,612,750 | 12,993,468 | |
| August 7, 2002 | Issuance of shares in connection with exercise of | ||
| options | 4,000 | 2,000 | |
| October 7, 2002 | Issuance of shares in connection with exercise of | ||
| options | 13,274 | 6,637 | |
| July 13, 2002 | Non-cash issuance of shares to consultants | 13,550 | 27,371 |
| September 18, 2002 | Issuance of shares in connection with exercise of | ||
| options | 32,000 | 16,000 | |
| September 30, 2002 | Issuance of shares in connection with exercise of | ||
| options | 25,000 | 12,500 | |
| October 15, 2002 | Issuance of shares in connection with exercise of | ||
| options | 20,081 | 10,040 | |
| November 20, 2002 | Issuance of shares in connection with exercise of | ||
| options | 113,000 | 56,500 | |
| November 22, 2002 | Issuance of shares in connection with exercise of | ||
| options | 33,072 | 16,536 | |
| November 25, 2002 | Issuance of shares in connection with exercise of | ||
| options | 7,000 | 3,500 | |
| December 4, 2002 | Non-cash issuance of shares to consultants | 15,318 | 26,653 |
| December 12, 2002 | Issuance of shares in connection with exercise of | ||
| options | 50,000 | 25,000 | |
| January 8, 2003 | Issuance of shares in connection with exercise of | ||
| options | 50,000 | 25,000 | |
| January 22, 2003 | Issuance of shares in connection with exercise of | ||
| options | 2,620 | 1,310 | |
| January 30, 2003 | Issuance of shares in connection with exercise of | ||
| options | 9,700 | 4,850 | |
| January 30, 2003 | Non-cash issuance of shares to consultants | 118,101 | 115,739 |
| February 14, 2003 | Issuance of shares in connection with exercise of | ||
| options | 499,403 | 249,702 | |
| February 20, 2003 | Issuance of shares in connection with exercise of | ||
| options | 483,746 | 241,873 | |
| February 28, 2003 | Issuance of shares in connection with exercise of | ||
| options | 2,530,483 | 1,265,242 | |
| March 5, 2003 | Issuance of shares in connection with exercise of | ||
| options | 3,107,891 | 1,553,945 | |
| March 15, 2003 | Issuance of shares in connection with exercise of | ||
| options | 25,000 | 12,500 |
16
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Default"
Note 11: Cumulative information continued
| April 3, 2003 | Issuance of shares in connection with exercise of — options | 421,314 | 210,657 | |
|---|---|---|---|---|
| Underwriting costs | - | (144,000 | ) | |
| Balance, June 30, 2003 | 66,187,303 | 16,733,023 | ||
| August 11, 2003 | Issuance of shares in connection with exercise of | |||
| options | 50,000 | 25,000 | ||
| August 13, 2003 | Issuance of shares in connection with exercise of | |||
| options | 25,000 | 12,500 | ||
| August 27, 2003 | Issuance of shares in connection with exercise of | |||
| options | 16,000 | 8,000 | ||
| August 27, 2003 | Non-cash issuance of shares to consultants | 70,768 | 49,538 | |
| August 29, 2003 | Issuance of shares in connection with exercise of | |||
| options | 34,000 | 17,000 | ||
| September 16, 2003 | Issue of shares in connection with private | |||
| placement, net of issue costs | 7,102,853 | 4,675,019 | ||
| January 12, 2004 | Non-cash issuance of shares to directors | 249,999 | 120,000 | |
| January 12, 2004 | Non-cash issuance of shares to consultants | 67,955 | 43,491 | |
| February 20, 2004 | Non-cash issuance of shares to consultants | 155,502 | 85,526 | |
| April 8, 2004 | Issuance of shares in connection with exercise of | |||
| options | 200,000 | 140,000 | ||
| April 15, 2004 | Issuance of shares in connection with exercise of | |||
| options | 100,000 | 70,000 | ||
| April 16, 2004 | Issuance of shares in connection with exercise of | |||
| options | 200,000 | 100,000 | ||
| April 16, 2004 | Issuance of shares in connection with exercise of | |||
| options | 200,000 | 140,000 | ||
| April 20, 2004 | Issuance of shares in connection with exercise of | |||
| options | 300,000 | 150,000 | ||
| April 22, 2004 | Issuance of shares in connection with exercise of | |||
| options | 200,000 | 100,000 | ||
| May 10, 2004 | Non-cash issuance of shares to consultants | 825,000 | 684,750 | |
| June 1, 2004 | Issuance of shares in connection with private | |||
| placement, net of issue costs | 40,000,000 | 17,520,098 | ||
| Expired options | - | 8,000 | ||
| Balance, June 30, 2004 | 115,984,380 | 40,681,945 | ||
| August 9, 2004 | Non-cash issuance of shares for settlement of | |||
| litigation | 1,350,000 | 756,000 | ||
| September 16, 2004 | Non-cash issuance of shares to consultants | 49,775 | 39,616 | |
| December 8, 2004 | Issuance of shares in connection with exercise of | |||
| options | 9,506,666 | 4,145,811 | ||
| December 17, 2004 | Non-cash issuance of shares to directors | 249,999 | 118,703 | |
| February 21, 2005 | Non-cash issuance of shares to consultants | 178,440 | 96,822 | |
| Balance, June 30, 2005 | 127,319,260 | 45,838,897 | ||
| August 10, 2005 | Non-cash issuance of shares to consultants | 825,000 | 435,230 | |
| Balance, June 30, 2006 | 128,144,260 | 46,274,127 | ||
| August 30, 2006 | Issuance of shares in connection with private | |||
| placement, net of issue costs | 250,000 | 43,125 | ||
| October 13, 2006 | Issuance of shares in connection with exercise of | |||
| options | 80,000 | 31,880 |
17
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Default"
Note 11: Cumulative information continued
| November 29, 2006 | Issuance of shares in connection with private — placement, net of issue costs | 15,616,246 | 4,256,979 |
|---|---|---|---|
| November 29, 2006 | Issuance of options in connection with private | ||
| placement | - | 905,742 | |
| December 1, 2006 | Issuance of shares in connection with exercise of | ||
| options | 15,000 | 4,905 | |
| December 28, 2006 | Issuance of shares in connection with private | ||
| placement, net of issue costs | 6,148,222 | 1,808,764 | |
| December 28, 2006 | Issuance of options in connection with private | ||
| placements | - | 356,597 | |
| April 16, 2007 | Issuance of shares in connection with exercise of | ||
| options | 38,000 | 14,569 | |
| May 3, 2007 | Non-cash issuance of shares to consultants | 200,000 | 94,800 |
| May 31, 2007 | Non-cash issuance of shares to consultants | 281,250 | 99,779 |
| May 31, 2007 | Non-cash issuance of shares to employees | 120,000 | 45,600 |
| May 31, 2007 | Issuance of shares in connection with exercise of | ||
| options | 625,000 | 51,545 | |
| Balance, June 30, 2007 | 151,517,978 | 53,988,412 | |
| October 17, 2007 | Issuance of shares in connection with private | ||
| placement, net of issue costs | 21,771,587 | 4,616,150 | |
| October 17, 2007 | Issuance of options in connection with private | ||
| placements | - | 1,052,293 | |
| October 23, 2007 | Issuance of shares in connection with private | ||
| placement, net of issue costs | 7,129,919 | 1,675,258 | |
| October 23, 2007 | Issuance of options in connection with private | ||
| placements | - | 344,614 | |
| October 30, 2007 | Issuance of shares in connection with private | ||
| placement, net of issue costs | 877,193 | 204,996 | |
| October 30, 2007 | Issuance of options in connection with private | ||
| placements | - | 42,398 | |
| December 24, 2007 | Non-cash issuance of shares to consultants | 303,385 | 88,971 |
| Equity to be issued | - | 151,323 | |
| Balance, December 31, 2007 | 181,600,062 | 62,164,415 |
18
MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation"
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
The following discussion and analysis includes certain forward-looking statements with respect to the business, financial condition and results of operations of our company. The words estimate, project, intend, expect and similar expressions are intended to identify forward-looking statements within the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated by such forward-looking statements. This discussion and analysis should be read in conjunction with our financial statements and notes thereto included elsewhere in this Report.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
BACKGROUND
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
We were incorporated under the laws of the Commonwealth of Australia on November 11, 1997. Our mission is to develop therapeutic drugs designed to treat the underlying cause of degeneration of the brain and the eye as the aging process progresses. The principal listing of our ordinary shares and listed options to purchase our ordinary shares is on the Australian Stock Exchange, or ASX. Since September 5, 2002, our American Depository Receipts, or ADRs, have traded on the NASDAQ Capital Market under the symbol PRAN. We have two wholly-owned subsidiaries, Prana Biotechnology Inc. and Prana Biotechnology UK Limited, incorporated in the United States and the United Kingdom, respectively, in August 2004.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Our financial statements appearing in this report are prepared in Australian dollars and in accordance with Australian equivalents to International Financial Reporting Standards, or A-IFRS. In this Report, all references to U.S. dollars or US$ are to the currency of the United States of America, and all references to Australian dollars or A$ are to the currency of Australia.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
All of our revenues are generated in Australian dollars, except for interest earned on foreign currency bank accounts, and the majority of our expenses are incurred in Australian dollars.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
OVERVIEW
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
We are a development stage enterprise at an early stage in the development of our pharmaceutical products that are designed to treat the underlying causes of degeneration of the brain and the eye as aging progresses. We have incurred net losses since inception and expect to incur substantial and increasing losses for the next several years as we expand our research and development activities and move our product candidates into later stages of development. All of our product candidates are in early stages of development and we face the risks of failure inherent in developing drugs based on new technologies. The process of carrying out the development of our products to later stages of development may require significant additional research and development expenditures, including pre-clinical testing and clinical trials, as well as for obtaining regulatory approval. To date, we have funded our operations primarily through the sale of equity securities, proceeds from the exercise of options, government grants, licensing and research collaborations and interest income.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Since completing our initial public offering and listing process on the ASX on March 28, 2000, we have concentrated our resources toward the pursuit of our disease targets. Initially we focused on clinical trials of our PBT1 compound as a therapeutic for the treatment of Alzheimers disease and in early August 2003, our PBT2 compound was announced as a new lead metal protein attenuating compound, or MPAC, molecule for Alzheimers disease.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
On April 11, 2005, we announced that we would not proceed with the scheduled Phase II/III study of PBT1 and that we had re-evaluated our further work on the PBT1 program. As part of our effort to manufacture Good Manufacturing Practice (GMP) grade PBT1 clinical trial material, we found unacceptably high levels of a di-iodo-8-hydroxyquinoline impurity that could potentially increase the risk of side-effects and mutagenic potential. We reached the conclusion that attempts to reduce the impurity to safe levels were not likely to be successful in a timely, commercially viable manner and that further development of PBT1 for the treatment of Alzheimers disease was not appropriate. On June 30, 2005, our Board of Directors determined that the core intellectual property relating to PBT1 had been impaired and the carrying value was written-off.
19
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
As a result of these events, we proceeded to conduct a strategic review of our pending strategic development programs. On June 16, 2005, we announced that we had completed a review of our strategic development programs and we reaffirmed our commitment to our lead candidate for the potential treatment of Alzheimers disease, PBT2. We completed two Phase I studies of PBT2 and on May 11, 2006, we announced our plans to move forward with a Phase IIa clinical trial for PBT2 in patients with Alzheimers disease. On December 19, 2006 we announced that dosing had commenced in the Phase IIa clinical trial. The Phase IIa trial is a three month double-blind, placebo-controlled safety and tolerability study of PBT2 in 80 elderly male and female patients with mild forms of Alzheimers disease. Tolerability, safety, cerebrospinal fluid and plasma biomarker and cognition endpoints will be measured. On September 24, 2007, we announced that the enrollment for the Phase IIa trial had been completed and that we expected to report results during the first calendar quarter of 2008. On November 29, 2007, we announced that the independent Data Safety Monitoring Board (DSMB) appointed by us had completed its cycle of safety review meetings and reported to us that of the 59 patients included in the review at that time, there had been no treatment related serious adverse events or withdrawals. The DSMB confirmed that the trial was safe to continue. Patient dosing was completed on December 18, 2007 and we announced the formal completion of the study on January 2, 2008. For additional details regarding our clinical trials see Item 4.A., Information on the Company History and Development of the Company, of our Form 20-F for the year ended June 30, 2007, filed with Securities and Exchange Commission on September 28, 2007.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
HIGHLIGHTS FOR THE SIX MONTHS ENDED DECEMBER 31, 2007
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Workstation"
Professor Colin Masters, a founder, director and member of our Research and Development Advisory Board, received the Victoria Prize.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Workstation"
In August 2007, Prof. Masters was awarded the State of Victorias most prestigious scientific award, the Victoria Prize, by the Victorian State government in recognition of his decades of work in the field of Alzheimers disease. The selection criteria for the Victoria Prize are based on the development of scientific or technological innovations that have significantly benefited the community.
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Workstation"
Completion of PBT2 Phase IIa clinical trial enrollment in Sweden and Australia.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Default"
In September 2007, we announced that patient enrollment for our PBT2 Phase IIa clinical trial had been completed at the study sites in Sweden and Australia and that patient dosing would be completed by the end of 2007.
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Workstation"
Company presentation at the Rodman & Renshaw 9 th Annual Healthcare Conference.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Workstation"
Dr. Steve Targum M.D., our chief medical advisor, was invited to the Rodman & Renshaw 9th Annual Healthcare conference in New York City in October 2007 to present an update on our pre-clinical discovery, research and development activities from our library of metal protein attenuating compounds (MPACs). Dr. Targum reported on the validation activities of our MPAC platform in Alzheimers disease and other neurological indications such as Huntingtons disease and the progress of our lead MPAC, PBT2, in its Phase IIa clinical trial.
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Workstation"
Data Safety Monitoring Board (DSMB) issues a favourable safety and tolerability report with respect to our on-going PBT2 Phase IIa study.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Workstation"
The independent DSMB appointed by us reviewed the emerging blinded safety and tolerability data from our on-going PBT2 Phase IIa study at three stages during the study. In November 2007, we announced that the final report issued by DSMB, based on the then available data from 59 patients, demonstrated that the trial was safe to continue in accordance with the trial protocol. The DSMB noted in its report the absence of treatment related serious adverse events or withdrawals.
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Workstation"
Completion of PBT2 Phase IIa trial.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Workstation"
On December 18, 2007, we reported the completion of patient dosing for our PBT2 Phase IIa trial and the trial was formally completed on January 2, 2008, on track for the release of results during the first calendar quarter of 2008.
20
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Workstation"
Research and Development Update at our Annual General Meeting of Shareholders (AGM) on immunotherapy and cancer programs.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Workstation"
At our annual general meeting of shareholders held in December 2007, we reported on our novel immunotherapy program for the treatment of Alzheimers disease. To date, we have generated monoclonal antibodies against a specific form of beta-amyloid peptide formed as a result of oxidative corruption. A candidate monoclonal antibody has been selected for animal trials in the first half of 2008. In addition, we reported that certain classes of MPACs from our library have shown potent anti-cancer activity and that we plan to undertake brain cancer animal modeling during 2008.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
SIX MONTHS ENDED DECEMBER 31, 2007 COMPARED TO SIX MONTHS ENDED DECEMBER 31, 2006
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Revenue
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Revenue increased to A$253,876 for the six months ended December 31, 2007 from A$236,869 for the six months ended December 31, 2006, an increase of A$17,007 or 7.18%. The revenue in the six months ended December 31, 2007 and 2006 consisted of interest income. The increase in revenue is primarily attributable to the private placement of our ordinary shares to professional investors in Australia and the United States in October 2007, which increased our cash and cash equivalents.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Research and development expense
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Research and development expense increased to A$3,642,796 for the six months ended December 31, 2007 from A$2,617,441 for the six months ended December 31, 2006, an increase of A$1,025,355 or 39.17%. The increase in research and development expense is primarily attributable to increased expenditure for drug discovery and costs associated with the Phase IIa trial.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Personnel expenses
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Personnel expenses increased to A$3,404,550 for the six months ended December 31, 2007 from A$2,178,272 for the six months ended December 31, 2006, an increase of A$1,226,278 or 56.3%. The increase in personnel expenses is primarily attributable to increased equity compensation in the form of options and shares granted to directors, employees and consultants.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Intellectual property expenses
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Intellectual property expenses decreased to A$235,534 for the six months ended December 31, 2007 from A$236,989 for the six months ended December 31, 2006, a decrease of A$1,455 or 0.61%.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Auditor and accounting fees
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Audit and accounting fees increased to A$207,627 for the six months ended December 31, 2007 from A$87,182 for the six months ended December 31, 2006, an increase of A$120,445 or 138.15%. The increase in audit and accounting fees is primarily attributable to additional auditor fees incurred in connection responding to comments with respect to our annual report on Form 20-F for the year ended June 30, 2006 issued by the Staff of the Securities and Exchange Commission.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Travel expenses
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Travel expenses decreased to A$113,574 for the six months ended December 31, 2007 from A$157,951 for the six months ended December 31, 2006, a decrease of A$44,377 or 28.09%. The decrease in travel expenses is primarily attributable to decreased overseas business travel for directors, executives and consultants.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Public relations and marketing expenses
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Public relations and marketing expenses decreased to A$68,276 for the six months ended December 31, 2007 from A$139,847 for the six months ended December 31, 2006, a decrease of A$71,571 or 51.18%. The decrease in public relations and marketing expenses is primarily attributable to a reduction in expenses paid to consultants.
21
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Depreciation expense
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Depreciation expense decreased to A$13,686 for the six months ended December 31, 2007 from A$30,226 for the six months ended December 31, 2006, a decrease of A$16,540 or 54.72%. The decrease in depreciation expense is primarily attributable to the full depreciation of previously acquired fixed assets during the prior period.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Other expenses
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Other expenses from ordinary activities decreased to A$508,778 for the six months ended December 31, 2007 from A$540,752 for the six months ended December 31, 2006, a decrease of A$31,974 or 5.91%. The decrease is primarily to a reduction in corporate compliance costs as a result of reduced legal costs and costs associated with the distribution of our annual reports, which are now made available to shareholders electronically.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Foreign exchange loss
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Foreign exchange loss decreased to A$293,180 for the six months ended December 31, 2007 from A$381,103 for the six months ended December 31, 2006, a decrease of A$87,923 or 23.07%. The decrease in foreign exchange loss is attributable to significant fluctuations of the U.S. dollar and Australian dollar exchange rates during the period.
MARKER FORMAT-SHEET="Head Left-TNR" FSL="Workstation"
Loss on fair valuation of financial liabilities
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Loss on fair valuation of financial liabilities increased to A$1,858,425 for the six months ended December 31, 2007 from A$1,662,719 for the six months ended December 31, 2006, an increase of A$195,706 or 11.77%. The losses relate to the five-year warrants to purchase an aggregate 3,000,000 ADRs at an exercise price of US$8.00 per ADR that were issued in connection with our private placement of securities in the United States in June 2004. The increase in the loss on fair value of financial liabilities is primarily attributable to changes in the market price of our ADRs and the volatility of the ADR market price.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
INFLATION AND SEASONALITY
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Management believes that inflation has not had a material impact on our companys operations or financial condition and that our operations are not currently subject to seasonal influences.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
LIQUIDITY AND CAPITAL RESOURCES
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
We are a development stage company and have had no sales income to date, and as of December 31, 2007, our accumulated deficit totaled A$62,575,588. From inception until our initial public offering in March 2000, we financed our operations primarily through borrowings from two of our directors, which were repaid from the proceeds of such offering. Since our initial public offering we have financed our operations primarily through sales of equity securities, proceeds from the exercise of options, government grants, licensing and research collaborations and interest earned on investments. Since inception we have raised a total of A$72,937,451, before associated costs.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
During the six months ended December 31, 2007, we raised approximately $8.4 million before costs in a private placement of our ordinary shares to professional investors in Australia and the United States. The private placement was for 29,778,699 ordinary shares (equivalent to 2,977,870 ADRs) at a price of A$0.285 per ordinary share (approximately US$3.48 per ADR). For every six ordinary shares acquired, the investors received two options, each for the purchase of one ordinary share, one of which option is exercisable at A$0.37 and expires on 31 October 2010 and the other is exercisable at A$0.43 and expires on 30 November 2010.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Net cash used in operating activities increased to A$6,022,782 in the six months ended December 31, 2007 from A$5,915,630 in the six months ended December 31, 2006.
22
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Net cash provided by financing activities increased to A$8,112,146 in the six months ended December 31, 2007 from A$7,400,898 in the six months ended December 31, 2006. During the six months ended December 31, 2007, we raised $8,486,929, before costs in a private placement of our ordinary shares to professional investors in Australia and the United States and during the six months ended December 31, 2006 we raised $7,740,360, before costs in a private placement of our ordinary shares to professional investors in Australia and the United States.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
We had A$9,168,753 of cash and cash equivalents at December 31, 2007, compared to A$7,409,256 at June 30, 2007 and A$11,531,143 at December 31, 2006.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
Capital expenditures for the six months ended December 31, 2007 was A$26,782 and capital expenditures for the six months ended December 31, 2006 was A$3,657. These expenditures were principally for computer equipment. We currently do not have significant capital spending or purchase commitments, but we expect to continue to engage in capital spending consistent with the level of our operations.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
We believe our existing cash and cash equivalents as well as anticipated cash flow from government grants, interest income and potential option exercises will be sufficient to support our current operating plan for at least 12 months; however, we have based this estimate on assumptions that may prove to be incorrect. Our future funding requirements will depend on many factors, including, but not limited to: the potential exercise of outstanding options, costs and timing of obtaining regulatory approvals; the costs and timing of obtaining, enforcing and defending our patent and intellectual property; the progress and success of pre-clinical and clinical trials of our product candidates; and the progress and number of our research programs in development.
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
We anticipate that we will require substantial additional funds in order to achieve our long-term goals and complete the research and development of our current principal pharmaceutical product candidate. In addition, we will require additional funds to pursue regulatory clearances, and defend our intellectual property rights, establish commercial scale manufacturing facilities, develop marketing and sales capabilities and fund operating expenses. We intend to seek such additional funding through public or private financings and/or through strategic alliances or other arrangements with corporate partners. We cannot, however, be certain that such additional financing will be available from any sources on acceptable terms, or at all, or that we will be able to establish new strategic alliances or other arrangements with corporate partners on acceptable terms, or at all. Any shortfall in funding could result in our having to curtail our operations, including our research and development activities, which could have a material adverse effect on our business, financial condition and results of operations.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
OFF-BALANCE SHEET ARRANGEMENTS
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
We are not a party to any material off-balance sheet arrangements. In addition, we have no unconsolidated special purpose financing or partnership entities that are likely to create material contingent obligations.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
CONDITIONS IN AUSTRALIA
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
We are incorporated under the laws of, and our principal offices and research and development facilities are located in, the Commonwealth of Australia. Therefore, we are directly affected by political and economic conditions in Australia.
MARKER FORMAT-SHEET="Head Major Left Bold-TNR" FSL="Workstation"
RISK FACTORS
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation"
There have been no material changes in our risk factors reported in our Annual Report on Form 20-F for the year ended June 30, 2007.
23
MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation"
SIGNATURES
MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default"
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
MARKER FORMAT-SHEET="Signature (Single)" FSL="Workstation"
Prana Biotechnology Limited /s/ Geoffrey P. Kempler By: Geoffrey P. Kempler Chief Executive Officer
MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Workstation"
Date: February 15, 2008