Announcement PDF Company Announcement IMAGION BIOSYSTEMS LIMITED ASX: IBX 25 August 2023 Section 708A(12C)(e) Cleansing Notice - Mercer Subsequent Tranche Convertible Notes This no ce is given by Imagion Biosystems Limited (IBX or the Company) under sec on 708A(12C)(e) of the Corpora ons Act 2001 (Cth) (Corpora ons Act) as amended by ASIC Corpora ons (Sale Offers: Securi es Issued on Conversion of Conver ble Notes) Instrument 2016/82. The Company hereby confirms that: (a) the conver ble notes described below will be issued without disclosure to an investor under Part 6D.2 of the Corpora ons Act; and (b) this Cleansing No ce has been given in accordance with sec on 708A(12C)(e) of the Corpora ons Act. The issue of this Cleansing No ce enables the fully paid ordinary shares in the capital of the Company (Shares) issued on the conversion of the conver ble notes issued by the Company on the terms described below (Conver ble Notes), to be on-sold to retail investors without further disclosure. 1. BACKGROUND As announced on 7 March 2023, the Company entered into a Conver ble Securi es Agreement with Mercer Street Global Opportunity Fund, LLC (Mercer or Investor) on 7 March 2023 to provide funding to the Company of up to $15,000,000 (CSA). Under the terms of the CSA, Mercer ini ally invested $1,500,000 in considera on for conver ble notes with an aggregate face value of $1,650,000, (First Tranche Conver ble Notes), and subsequently invested a further $1,000,000 in considera on for conver ble notes with an aggregate face value of $1,100,000 (Second Tranche Conver ble Notes). Further material terms of the CSA are set out in the Company's ASX announcement dated 7 March 2023. On 21 July 2023 Mercer converted 300,000 conver ble notes resul ng in the issue of 22,222,222 ordinary shares in the Company to Mercer. On 25 August 2023, Mercer subsequently invested a further $1,000,000 in considera on for 1,100,000 conver ble notes with an aggregate face value of $1,100,000 (Subsequent Conver ble Notes) which have previously been approved by the Company’s Shareholders. The material terms of the Subsequent Conver ble Notes are as follows: Item Ma er Par culars 1. Type of instrument Secured conver ble notes conver ble into fully paid ordinary shares (Shares) at the Conversion Price. 2. Denomina on AUD. 3. Face Value The face value of each Conver ble Note is $1.00. 4. Maturity Date 18 months from date of issue. 5. Interest payable on No interest is payable on the unconverted drawn funds. Conver ble Notes In the event of a default by the Company, the Company must pay interest at a rate of 15% per annum on the Face Value of all outstanding Conver ble Notes. 6. Conversion The Investor may (at its absolute discre on) convert any Conver ble Notes at any me prior to the Maturity Date, by giving the Company a conversion no ce, provided such conversion is for a Face Value in an amount equal to or greater than $25,000 (unless the remaining Face Value of the Conver ble Notes on issue is less than $25,000, in which case for the full remaining value). 7. Conversion Price The higher of: (i) 90% of the lowest daily VWAP (volume weighted average price) of the Shares for the 15 trading days on which Shares traded in the ordinary course of business on the ASX ending on the date immediately prior to the relevant conversion no ce; and (ii) a floor price of $0.0125. 8. Repayment The Face Value of any unconverted Conver ble Notes and any accrued by unpaid interest are repayable by the Company: (i) within 20 business days of the Maturity Date; and (ii) if an event of default is subsis ng a er 10 business days of the Company receiving a no ce of default from the Investor, within 10 business days a er the end of such no ce period. The Investor may also require repayment by the Company of the Conver ble Notes upon occurrence of a change of control, a delis ng or a qualifying capital raising which in aggregate raises $10,000,000 or more. 9. Events of Default Standard events of default apply, including but not limited to an insolvency event or material adverse effect occurring, or the Company being in breach of any obliga on, covenant or undertaking to the Investor and the breach not being rec fied within 5 business days. 10. Vo ng The Conver ble Notes do not en tle the holder to any vo ng rights. 11. Governing Law Queensland, Australia 2. CONTENTS OF THIS CLEANSING NOTICE This Cleansing No ce sets out the following: (a) in rela on to the Subsequent Conver ble Notes: (b) (i) the effect of the issue on the Company; (ii) a summary of the rights and liabili es a aching to the Conver ble Notes; and (iii) a summary of the rights and liabili es a aching to the Shares that will be issued on the conversion of the Conver ble Notes; and any informa on that: (i) has been excluded from con nuous disclosure no ces in accordance with the ASX Lis ng Rules; and (ii) is informa on that investors and their professional advisors would reasonably require for the purpose of making an informed assessment of: (iii) 3. (A) the assets and liabili es, financial posi on and performance, profits and losses and prospects of the Company; and (B) the rights and liabili es a aching to the Shares; and other informa on rela ng to the Company’s status as a disclosing en ty. THE EFFECT OF THE ISSUE ON THE COMPANY 3.1 Effect of the issue on the Company The principal effect of the issue of the Subsequent Conver ble Notes on the Company will be: (a) the sa sfac on of the Company's obliga ons under the CSA; (b) an increase in the number of unquoted Conver ble Notes on issue from 2,450,000 to 3,550,000; (c) the Company having an increase in liability for the aggregate amount of the Face Value (and any accrued but unpaid interest) of the Conver ble Notes issued under the CSA; and (d) if the Conver ble Notes are converted at the lowest possible conversion price (being $0.0125), a maximum increase in the number of Shares by 284,000,000 Shares. 3.2 (a) (b) 3.3 (a) Pro Forma Consolidated Statement of Financial Posi on taking into Account the Issue of the Conver ble Notes Set out in Annexure A is a pro forma consolidated Statement of Financial Posi on for the Company and its controlled en es (“consolidated en ty”) based on the audited financial statements of the consolidated en ty as at 31 December 2022 adjusted to reflect the proposed Conver ble Notes issue and has been prepared on the basis of the accoun ng policies normally adopted by the Company. The pro forma financial informa on is presented in an abbreviated form in so far as it does not include all of the disclosures required by Australian Accoun ng Standards applicable to annual financial statements. The pro forma financial informa on is not audited. The classifica on of the alloca ons between debt and equity for the Conver ble Notes may change in the future. Poten al Effect on Capital Structure As at the date of this Cleansing No ce the total number of issued Shares is 1,305,766,572; (b) The capital structure of the Company will be affected by the conversion of Conver ble Notes by the Investor. (c) The effect on the issued share capital of the Company upon the issue and conversion of the Conver ble Notes: Shares Number Shares issued on the date of this Cleansing No ce 1,305,766,572 Shares issued upon conversion of the Subsequent 88,000,000 Conver ble Notes1 Shares issued upon conversion of the Second Tranche 88,000,000 Conver ble Notes1 Shares issued upon conversion of the previously issued 108,000,000 First Tranche Conver ble Notes1 Total Shares on issue following conversion of all 1,589,766,572 Conver ble Notes2 NOTE: 1. This assumes that the Conver ble Notes are converted at the lowest possible Conversion Price (being $0.0125). 2. This table does not include the poten al effect of any Shares which may be issued a er the date of this Cleaning No ce, including any Shares or op ons to be issued to Mercer under the CSA. 4. RIGHTS AND LIABILITIES ATTACHING TO SHARES ISSUED ON CONVERSION OF THE CONVERTIBLE NOTES The Shares issued to the Investor on the conversion of the Conver ble Notes under the CSA will rank equally in all respects with all of the Company’s exis ng Shares. The rights a aching to the Shares, including new Shares to be issued to the Investor on the conversion of the Conver ble Notes, are set out in the Company’s cons tu on, and, in certain circumstances, regulated by the Corpora ons Act, the ASX Lis ng Rules and the general law. The Company intends to apply to ASX for quota on of the Shares issued on conversion of any Conver ble Notes. Full details of the rights and liabili es a aching to Shares are set out in the Company’s cons tu on, a copy of which can be inspected free of charge, at the Company’s registered office during normal business hours. The following is a broad summary of the rights, privileges and restric ons a aching to all Shares. This summary is not exhaus ve and does not cons tute a defini ve statement of the rights and liabili es of Shareholders. (A) GENERAL MEETINGS Shareholders are en tled to be present in person, or by proxy, a orney or representa ve to a end and vote at general mee ngs of the Company. Shareholders may requisi on mee ngs in accordance with sec on 249D of the Corpora ons Act and the Company’s cons tu on. VOTING RIGHTS Subject to any rights or restric ons for the me being a ached to any class or classes of Shares, at general mee ngs of Shareholders or classes of Shareholders: (i) each Shareholder en tled to vote may vote in person or by proxy, a orney or representa ve; (B) (ii) on a show of hands, every person present who is a Shareholder or a proxy, a orney or representa ve of a Shareholder has one vote; and (iii) on a poll, every person present who is a Shareholder or a proxy, a orney or representa ve of a Shareholder shall, in respect of each fully paid Share held by him, or in respect of which he is appointed a proxy, a orney or representa ve, have one vote for the Share, and a frac on of a vote for each partly paid Share, equivalent to the propor on which the amount paid (not credited) is of total amounts paid and payable (excluding amounts credited), ignoring any amounts payable in advance of a call. DIVIDEND RIGHTS Subject to the rights of any preference Shareholders and to the rights of the holders of any Shares created or raised under any special arrangement as to dividend, the Directors may from me to me declare a dividend to be paid to the Shareholders en tled to the dividend which shall be payable on all Shares according to the propor on that the amount paid (not credited) is of the total amounts paid and payable (excluding amounts credited) in respect of such Shares. (C) The Directors may from me to me pay to the Shareholders any interim dividends as they may determine. No dividend shall carry interest as against the Company. The Directors may set aside out of the profits of the Company any amounts that they may determine as reserves, to be applied at the discre on of the Directors, for any purpose for which the profits of the Company may be properly applied. WINDING-UP If the Company is wound up, the liquidator may, with the authority of a special resolu on of the Company, divide among the Shareholders in kind the whole or any part of the property of the Company, and may for that purpose set such value as he considers fair upon any property to be so divided, and may determine how the division is to be carried out as between the Shareholders or different classes of Shareholders. (D) The liquidator may, with the authority of a special resolu on of the Company, vest the whole or any part of any such property in trustees upon such trusts for the benefit of the contributories as the liquidator thinks fit, but so that no Shareholder is compelled to accept any Shares or other securi es in respect of which there is any liability. SHAREHOLDER LIABILITY As the Shares to be issued on the conversion of the Conver ble Notes will be fully paid shares, they will not be subject to any calls for money by the Directors and will therefore not become liable for forfeiture. (E) TRANSFER OF SHARES Generally, Shares are freely transferable, subject to formal requirements, the registra on of the transfer not resul ng in a contraven on of or failure to observe the provisions of a law of Australia and the transfer not being in breach of the Corpora ons Act or the ASX Lis ng Rules. (F) (G) FUTURE INCREASE IN CAPITAL The allotment and issue of any new Shares is under the control of the Directors. Subject to restric ons on the issue or grant of securi es contained in the ASX Lis ng Rules, the Company’s cons tu on and the Corpora ons Act (and without affec ng any special right previously conferred on the holder of an exis ng share or class of shares), the Directors may issue securi es as they shall, in their absolute discre on, determine. VARIATION OF RIGHTS Subject to the Corpora ons Act and the ASX Lis ng Rules, if at any me the share capital is divided into different classes of Shares, the rights a ached to any class (unless otherwise provided by the terms of issue of the shares of that class), whether or not the Company is being wound up, may be varied with the consent in wri ng of the holders of three-quarters of the issued shares of that class, if authorised by a special resolu on passed at a separate mee ng of the holders of the shares of that class or as otherwise permi ed by the Corpora ons Act. (H) (I) ALTERATION OF CONSTITUTION The Company’s cons tu on can only be amended by a special resolu on passed by at least three quarters of Shareholders present and vo ng at the general mee ng. 5. COMPLIANCE WITH DISCLOSURE OBLIGATIONS The Company is a “disclosing en ty” under the Corpora ons Act and, as such, is subject to regular repor ng and disclosure obliga ons under both the Corpora ons Act and the ASX Lis ng Rules. These obliga ons require the Company to no fy ASX of informa on about specific events and ma ers as they arise. In par cular, the Company is obliged to con nuously disclose to the market immediately any informa on which a reasonable person would expect to have a material effect on the price or the value of the Shares. The Company is also required to prepare and lodge with ASIC yearly and half-yearly financial statements accompanied by a directors’ statement and report, and an audit report or review. Copies of documents lodged with ASIC in rela on to the Company may be obtained from, or inspected at, an ASIC office. The Company will provide a copy of each of the following documents, free of charge, to any person on request: (a) the annual financial report most recently lodged by the Company with ASIC, being the financial report of the Company for the year ended 31 December 2022; (b) any half-year financial report lodged by the Company with ASIC a er the lodgement of the annual financial report referred to in paragraph (a) and before the lodgement of this Cleansing No ce with ASX; and (c) any con nuous disclosure no ces given by the Company to ASX a er the lodgement of the annual financial report referred to in paragraph (a) and before the lodgement of this Cleansing No ce with ASX. A list of the con nuous disclosure no ces given by the Company to ASX a er lodgement of the annual financial report referred to in paragraph (a) above and before the lodgement of this Cleansing No ce with ASX is set out in the table below. Date 28 Feb 2023 1 Mar 2023 7 Mar 2023 7 Mar 2023 7 Mar 2023 7 Mar 2023 7 Mar 2023 7 Mar 2023 7 Mar 2023 7 Mar 2023 7 Mar 2023 7 Mar 2023 7 Mar 2023 14 Mar 2023 15 Mar 2023 15 Mar 2023 15 Mar 2023 17 Mar 2023 21 Mar 2023 21 Mar 2023 21 Mar 2023 21 Mar 2023 21 Mar 2023 27 Mar 2023 27 Mar 2023 28 Mar 2023 11 Apr 2023 11 Apr 2023 13 Apr 2023 19 Apr 2023 21 Apr 2023 24 Apr 2023 26 Apr 2023 26 Apr 2023 28 Apr 2023 28 Apr 2023 2 May 2023 4 May 2023 25 May 2023 25 May 2023 25 May 2023 Announcement Appendix 4G and Corporate Governance Statement Imagion receives 2nd CSIRO grant for prostate cancer project Imagion Funding Update Imagion Secures Growth Funding Non-renounceable En tlement Offer En tlement Offer Booklet Cleansing No ce - En tlement Offer Proposed issue of securi es - IBX Investor Presenta on Proposed issue of securi es - IBX Proposed issue of securi es - IBX Proposed issue of securi es - IBX Correc on to Announcement and Offer Booklet Cleansing No ce - En tlement Offer Dispatch of En tlement Offer Documents Le er to Shareholders - En tlement Offer En tlement Offer Booklet Cleansing No ce under Sec on 708A(12C)(e) Conver ble Securi es Investment Cleansing No ce - Mercer Commencement Shares No fica on regarding unquoted securi es - IBX No fica on regarding unquoted securi es - IBX Applica on for quota on of securi es - IBX Imagion to proceed to file an IND following FDA feedback En tlement Offer - Extension of Closing Date No ce to IBXOA Op on Holders No fica on regarding unquoted securi es - IBX No fica on of cessa on of securi es - IBX Imagion Biosystems April 2023 Investor Newsle er Results of Non-renounceable En tlement Offer Applica on for quota on of securi es - IBX No ce of Annual General Mee ng/Proxy Form No fica on regarding unquoted securi es - IBX Change of Director's Interest No ce Quarterly Ac vi es/Appendix 4C Cash Flow Report Imagion ini ates leadership restructuring plan No fica on of cessa on of securi es - IBX Change of Director's Interest No ces Chairman's Address to Shareholders AGM Investor Presenta on Results of Mee ng 26 May 2023 26 May 2023 26 May 2023 26 May 2023 26 May 2023 30 May 2023 31 May 2023 31 May 2023 1 Jun 2023 1 Jun 2023 1 Jun 2023 19 Jun 2023 21 Jun 2023 28 Jun 2023 12 Jul 2023 14 Jul 2023 14 Jul 2023 17 Jul 2023 21 Jul 2023 31 Jul 2023 31 Jul 2023 11 Aug 2023 No fica on regarding unquoted securi es – IBX Issue of First Tranche Op ons - B Appendix 3B – Proposed Issue of Securi es Appendix 3B – Proposed Issue of Securi es Cleansing No ce under Sec on 708A(12C)(e) Appendix 3G – Unquoted Securi es Appendix 3G – Unquoted Securi es Cleansing No ce under Sec on 708A(12C)(e) Conver ble Note Investment Appendix 3G – Unquoted Securi es Appendix 3G – Unquoted Securi es Imagion announces new CEO Imagion to complete the MagSense HER2 Phase 1 Study Expanded collabora on with Siemens Healthineers to US Response to ASX price query Non-renounceable en tlement offer shor all Applica on for quota on of securi es - IBX Transi on of Chairman Applica on for quota on of securi es - IBX Quarterly Ac vi es/Appendix 4C Cash Flow Report Le er to shareholders from CEO Dr. Isaac Bright MOU to develop early pancrea c cancer diagnosis pla orm 6. INFORMATION EXCLUDED FROM CONTINUOUS DISCLOSURE NOTICES As at the date of this Cleansing No ce, the Company advises that it has fully complied with its disclosure obliga ons under the ASX Lis ng Rules and the Corpora ons Act, and, in par cular, there is no informa on which the Company has excluded from any of its con nuous disclosure no ces given in accordance with the ASX Lis ng Rules and the Corpora ons Act as at the date of this Cleansing No ce which it would be reasonable for investors and their professional advisors to require for the purpose of making an informed assessment of: (a) the assets and liabili es, financial posi on and performance, profits and losses and prospects of the Company; and (b) the rights and liabili es a aching to the Conver ble Notes and the Shares. -ENDS About Imagion Biosystems Established in 2017 and headquartered in the San Diego, California, US, Imagion Biosystems is an ASXlisted company dedicated to developing innova ve medical imaging technologies for various cancer types. Imagion Biosystems is advancing clinical development of its MagSense® pla orm technology to revolu onize cancer diagnosis, introducing molecular imaging to MRI. The Company’s lead program has demonstrated its innova ve technology embodied in MagSense® HER2 Imaging Agent (MSH2IA) is safe and well-tolerated in pa ents with diagnosed HER2+ breast cancer. Imagion Biosystems’ MagSense® pipeline includes prostate cancer, ovarian cancer, and brain cancer programs advancing towards clinical development. For more informa on, visit h ps://imagionbiosystems.com/investor-hub/ Imagion Biosystems Interac ve Investor Hub Engage with us directly by asking ques ons, watching video summaries, and seeing what other shareholders have to say about this and past announcements at our Investor Hub: h ps://investorhub.imagionbiosystems.com/ Authorisa on & Addi onal informa on This announcement was authorised by the Board of Imagion Biosystems Limited. Australian Media & Investor Rela ons: Geoff Hollis, CFO and Company Secretary geoff.hollis@imagionbio.com +61 438 168 008 U.S. Media Contact Casie Ost casie.ost@imagionbio.com +1-619-693-4428 Annexure A Pro Forma Consolidated Statement of Financial Position This pro forma consolidated Statement of Financial Position for the Company and its controlled entities (“consolidated entity”) is based on the audited financial statements of the consolidated entity as at 31 December 2022 adjusted to reflect the proposed Convertible Notes issue and has been prepared on the basis of the accounting policies normally adopted by the Company. Statutory Historical Consolidated Statement of Impact of first Financial convertible Position securities Impact of second convertible securities Impact of subsequent convertible securities 31-Dec-22 Pro-Forma 31-Dec-22 $ $ $ $ $ Current Assets Cash and cash equivalents 4,446,102 1,500,000 1,000,000 1,000,000 7,946,102 Trade and other receivables 92,463 - - - 92,463 Other current assets 449,985 - - - 449,985 Total Current Assets 4,988,550 1,500,000 1,000,000 1,000,000 8,488,550 703,276 - - - 703,276 Right-of-use assets 4,283,796 - - - 4,283,796 Total Non-Current Assets 4,987,072 - - - 4,987,072 Total Assets 9,975,622 1,500,000 1,000,000 1,000,000 13,475,622 436,788 - - - 436,788 Non-Current Assets Property, plant and equipment Current Liabilities Trade and other payables Lease liabilities Employee benefits 1,041,051 - - - 1,041,051 175,032 - - - 175,032 Other liabilities 80,033 - - - 80,033 - 1,350,000 1,100,000 1,100,000 3,550,000 1,732,904 1,350,000 1,100,000 1,100,000 5,282,904 3,563,318 - - - 3,563,318 1,904 - - - 1,904 Total Non-Current Liabilities 3,565,222 - - - 3,565,222 Total Liabilities 5,298,126 1,350,000 1,100,000 1,100,000 8,848,126 Net Assets 4,677,496 150,000 (100,000) (100,000) 4,627,496 Issued capital 56,830,408 300,000 - - 57,130,408 Reserves 3,688,550 - - - 3,688,550 (55,841,462) 4,677,496 (150,000) 150,000 (100,000) (100,000) Convertible securities Total Current Liabilities Non-Current Liabilities Lease liabilities (NCA) Employee benefits Equity Accumulated losses Total Equity (100,000) (56,191,462) (100,000) 4,627,496