INVION LIMITED — Interim / Quarterly Report 2013

Oct 25, 2012

ASX ANNOUNCEMENT: APPENDIX 4C

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26 October 2012

The Manager Company Announcements Office ASX Limited 20 Bridge St SYDNEY NSW 2000

Dear Sir

APPENDIX 4C

30 September 2012.

The Company held cash reserves of $4.748 million at the end of September. Cash outflows during the quarter relating to operating expenses ($1.723 million) were higher than the previous quarter ($1.457 million).

On 30 August 2012, Shareholders voted to approve the merger with US-based Inverseon Inc. 143,486,978 fully paid Ordinary shares were issued in consideration of the acquisition of Inverseon. The company changed its name on 31 August 2012 to Invion Limited, and on 5 September 2012 changed its ASX Issuer code to IVX. Approximately one quarter of expenditure in the period relates to costs associated with the transaction.

Total spend on R&D ($245,000) was significantly higher than the previous quarter ($16,000) reflecting a return to clinical development activities subsequent to the merger. Scientific activities during the quarter were directed toward the progression of the clinical programs of the company’s two current assets - INV102 and Cpn10 - in the following indications: asthma, chronic bronchitis and lupus.

Prior to the end of the quarter, and subsequent to a review and realignment of business activities to meet forward clinical development milestones, two staff positions were made redundant.

In September, the company received $2.22 million in R&D tax incentive rebate. The rebate comprised a cash refund of up to 45 cents of each dollar of eligible R&D spend for local R&D activities carried out in the financial year ending 30 June 2012.

An Appendix 4C accompanies this announcement.

For and on behalf of the Board of Invion Limited

MELANIE FARRIS Company Secretary

Invion Limited ABN 76 094 730 417

Unit 2, 120 Bluestone Circuit, Seventeen Mile Rocks, QLD 4073 P +61 7 3295 0500 F +61 7 3295 0599 www.invion.com.au

Appendix 4C Quarterly report for entities admitted on the basis of commitments

Appendix 4C

Quarterly report for entities admitted on the basis of commitments

Introduced 31/3/2000. Amended 30/9/2001

Name of entity
INVION LIMITED
ABN 76 094 730 417	Quarter ended(“currentquarter”)
76 094 730 417	30-September-2012

Consolidated statement of cash flows

Cash flows related to operating activities Payments for (a) staff costs (b) patent costs (c) research and development (d) leased assets (e) other working capital 1.3 Dividends received 1.4 1.5 1.6 Income taxes paid 1.7 Other Research & Development tax refund 1.1 Receipts from customers 1.2 Interest and other items of a similar nature received Interest and other costs of finance paid Net operating cash flows	Current quarter $A’000	Year to date (3 months) $A’000
	(507) (37) (245) (6) (928) - 35 - - 2,227 16	(507) (37) (245) (6) (928) - 35 - - 2,227 16
	555	555

Appendix 4 C Page 1

Appendix 4C Quarterly report for entities admitted on the basis of commitments

	Current quarter $A’000	Year to date (3 months) $A’000
1.8 Net operatingcash flows(carried forward)	555	555
(a) businesses (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets (a) businesses (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets 1.11 Loans to other entities 1.12 1.13 Other Cash acquired on takeover of subsidiary Net investing cash flows 1.14 Loans repaid by other entities Cash flows related to investing activities 1.9 1.10 Proceeds from disposal of: Payment for acquisition of: Total operating and investing cash flows	- - - - - - - 1 - - - 7	- - - - - - - 1 - - - 7
	8	8
	563	563
1.15 1.16 1.17 1.18 1.19 Dividends paid 1.2 Net financing cash flows Proceeds from issues of shares Cash flows related to financing activities Proceeds from shares not yet issued Other Creditors (costs of fund raising) Proceeds from borrowings Repayment of borrowings	- - - - - -	- - - - - -
	-	-
1.21 1.22 1.23 Cash at end ofquarter Net increase (decrease) in cash held Cash at beginning of quarter/year to date Exchange rate adjustments to item 1.20	563 4,185 -	4,185 - 563
	4,748	4,748

Appendix 4 C Page 2

Appendix 4C Quarterly report for entities admitted on the basis of commitments

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities

1.24 1.25 Aggregate amount of payments to the parties included in item 1.2 (a) Aggregate amount of loans to the parties included in item 1.11	Current quarter $A'000
	171
	-

• 1.26 Explanation necessary for an understanding of the transactions

Separate to the amounts noted at 1.24 above, at 30 September 2012, $212,000 in fees were paid or were payable to McCullough Robertson Lawyers. Mr Brett Heading is a Partner at McCullough Robertson.

Non-cash financing and investing activities

Details of financing and investing transactions which have had a material effect on consolidated assets and 2.1 liabilities but did not involve cashflows

During the period, Invion Limited acquired and merged with Inverseon Inc. 143,486,978 fully paid Ordinary shares were issued as consideration for the acquisition.

Details of outlays made by other entities to establish or increase their share in businesses in which the 2.2 reporting entity has an interest

N/A

Financing facilities available

Add notes as necessary for an understanding of the position. (See AASB 1026 paragraph 12.2).

3.1 Loan facilities 3.2 3.3 Convertible loan facility Credit standby arrangements	Amount available $A’000	Amount used $A’000
	-	-
	-	-
	-	-

Appendix 4 C Page 3

Appendix 4C Quarterly report for entities admitted on the basis of commitments

Reconciliation of cash

Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter $A’000	Previous quarter $A’000
4.1 4.2 Deposits at call 4.3 Bank overdraft 4.4 Other (provide details) Cash on hand and at bank	2,733	4,035
	2,015	150
	-	-
	-	-
Total: cash at end of quarter(item 1.23)	4,748	4,185

Acquisitions and disposals of business entities

5.1 Name of entity 5.2 5.3 5.4 Total net assets 5.5 Nature of business Place of incorporation or registration Consideration for acquisition or disposal	Acquisitions	Disposals
	Inverseon Inc.	N/A
	USA
	Issue of 143,486,978 fully paid Ordinary shares
	-$155,735
	Pharmaceutical drug development

Compliance statement

• This statement has been prepared under accounting policies which comply with accounting standards as

• 1 defined in the Corporations Act (except to the extent that information is not required because of note 2) or other standards acceptable to ASX.

2 This statement does give a true and fair view of the matters disclosed.

Sign here: Company Secretary

Date: 26-October-2012

Print name: Melanie Farris

Appendix 4 C Page 4