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MindBio Therapeutics Corp. Proxy Solicitation & Information Statement 2024
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Proxy Solicitation & Information Statement
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MindBio
Therapeutics
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
AND
MANAGEMENT INFORMATION CIRCULAR
Dated: November 5, 2024
Meeting Details
Date: December 18, 2024
Time: 2:00 p.m. (Vancouver Time)
Place: Suite 2200, 885 West Georgia Street,
Vancouver, British Columbia, V6C 3E8
MindBio Therapeutics
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the annual general meeting (the “Meeting”) of the holders of common shares (“Shareholders”) of MindBio Therapeutics Corp. (the “Company”) will be held at Suite 2200, 885 West Georgia Street, Vancouver, British Columbia, Canada on the 18th day of December, 2024 at 2:00 p.m. (Vancouver time) for the following purposes:
(a) to receive the audited consolidated financial statements of the Company as at and for the financial year ended June 30, 2024 and 2023, together with the reports of the auditor thereon;
(b) to appoint MNP LLP as auditor of the Company for the ensuing year and authorize the board of directors to fix the remuneration of the auditor;
(c) to fix the number of the directors of the Company for the ensuing year at three (3);
(d) to elect directors to hold office for the ensuing year; and
(e) to transact such other business as may properly be transacted at the Meeting or at any adjournment thereof.
The specific details of the foregoing matters to be put before the Meeting, as well as further information with respect to voting by proxy, are set forth in the information circular accompanying this notice of Meeting. Only Shareholders of record at the close of business on November 5, 2024 are entitled to receive notice of and to vote at the Meeting.
A Shareholder who is unable to attend the Meeting in person and who wishes to ensure that such Shareholder’s shares will be voted at the Meeting is requested to complete, date and sign the enclosed form of proxy and deliver it in accordance with the instructions set out in the form of proxy and in the information circular accompanying this notice of Meeting.
The enclosed proxy is solicited by management, but you may amend it, if you so desire, by striking out the names listed therein and inserting in the space provided, the name of the person you wish to represent you at the Meeting.
DATED this 5th day of November, 2024.
By order of the Board of Directors
MINDBIO THERAPEUTICS CORP.
/s/ “Justin Hanka”
Justin Hanka
Chief Executive Officer
MindBio
Therapeutics
MANAGEMENT INFORMATION CIRCULAR
(containing information as at November 5, 2024 unless otherwise stated)
For the Annual General Meeting of Shareholders to be held on Wednesday, December 18, 2024
SOLICITATION OF PROXIES
This Information Circular (this “Circular”) is furnished in connection with the solicitation of proxies by the management (“Management”) of MindBio Therapeutics Corp. (the “Company”), for use at the annual general meeting (the “Meeting”) of the shareholders (“Shareholders”) of the Company to be held on December 18, 2024, at the time and place and for the purposes set forth in the accompanying Notice of Meeting and at any adjournment thereof.
The enclosed form of proxy (the “Proxy”) is solicited by Management. The solicitation will be primarily by mail however, proxies may be solicited personally or by telephone by the regular officers and employees of the Company. The cost of solicitation will be borne by the Company.
We strongly encourage Shareholders to vote their common shares prior to the Meeting by proxy, prior to the proxy cut-off at 2:00 p.m. (Vancouver time) on Monday, December 16, 2024.
APPOINTMENT OF PROXYHOLDERS
The persons named in the Proxy are representatives of the Company.
A Shareholder entitled to vote at the Meeting has the right to appoint a person (who need not be a Shareholder) to attend and act on the Shareholder’s behalf at the Meeting other than the persons named in the accompanying Proxy. To exercise this right, a Shareholder shall strike out the names of the persons named in the accompanying Proxy and insert the name of the Shareholder’s nominee in the blank space provided or complete another suitable form of proxy.
A proxy will not be valid unless it is duly completed, signed and deposited with the Company’s registrar and transfer agent, Odyssey Trust Company (“Odyssey”) by mail at Traders Bank Building 702, 67 Yonge Street Toronto, Ontario M5E 1J8 (Attention: Proxy Department), by email at [email protected], or by fax at 1-800-517-4553, not less than 48 hours, excluding Saturdays, Sundays and statutory holidays, preceding the Meeting or any adjournment or postponement thereof. You may also vote by internet voting at https://vote.odysseytrust.com not less than 48 hours, excluding Saturdays, Sundays and statutory holidays, preceding the Meeting or any adjournment or postponement thereof. A proxy must be signed by the Shareholder or by his attorney in writing, or, if the Shareholder is a corporation, it must either be under its common seal or signed by a duly authorized officer.
VOTING BY PROXYHOLDER
Manner of Voting
The common shares represented by the Proxy will be voted or withheld from voting in accordance with the instructions of the Shareholder on any ballot that may be called for and, if the Shareholder specifies a choice on the Proxy with respect to any matter to be acted upon, the shares will be voted accordingly. On any poll, the persons named in the Proxy (the “Proxyholders”) will vote the shares in respect of which they are appointed. Where directions are given by the Shareholder in respect of voting for or against any resolution, the Proxyholder will do so in accordance with such direction.
The Proxy, when properly signed, confers discretionary authority on the Proxyholder with respect to amendments or variations to the matters which may properly be brought before the Meeting. At the time of printing this Circular, Management is not aware that any such amendments, variations or other matters are to be presented for action at the Meeting. However, if any other matters which are not now known to Management should properly come before the Meeting, the proxies hereby solicited will be exercised on such matters in accordance with the best judgment of the Proxyholder.
In the absence of instructions to the contrary, the Proxyholders intend to vote the common shares represented by each Proxy, properly executed, in favour of the motions proposed to be made at the Meeting as stated under the headings in this Circular.
Revocation of Proxy
A Shareholder who has given a Proxy may revoke it at any time before it is exercised. In addition to revocation in any other manner permitted by law, a Proxy may be revoked by instrument in writing executed by the Shareholder or by his or her attorney authorized in writing, or, if the Shareholder is a corporation, it must either be under its common seal or signed by a duly authorized officer and deposited with Odyssey at Traders Bank Building 702, 67 Yonge Street, Toronto, ON M5E 1J8 (Attention: Proxy Department), or by fax to 1-800-517-4553, or via email to [email protected] not less than 48 hours, excluding Saturdays, Sundays and statutory holidays, preceding the Meeting or any adjournment or postponement thereof, or delivered to the Chair of the Meeting on the day of the Meeting or any adjournment of it. A revocation of a Proxy does not affect any matter on which a vote has been taken prior to the revocation.
Voting Thresholds Required for Approval
In order to approve a motion proposed at the Meeting, a majority of not less than one-half of the votes cast will be required unless the motion requires a special resolution, in which case a majority of not less than two-thirds of the votes cast will be required. In the event a motion proposed at the Meeting requires disinterested Shareholder approval, common shares held by Shareholders of the Company who are also "insiders", as such term is defined under applicable securities laws, will be excluded from the count of votes cast on such motion.
ADVICE TO REGISTERED SHAREHOLDERS
Shareholders whose names appear on the records of the Company as the registered holders of common shares in the capital of the Company (the "Registered Shareholders") may choose to vote by proxy whether or not they are able to attend the Meeting in person.
Registered Holders who are unable to attend the Meeting in person are requested to complete, sign, date and return the enclosed Proxy or other appropriate form of proxy. Completed forms of proxy must be received by Odyssey by mail at Traders Bank Building 702, 67 Yonge Street, Toronto, ON M5E 1J8, by email at [email protected], or by fax at 1-800-517-4553, not less than 48 hours, excluding Saturdays, Sundays and statutory holidays, preceding the Meeting or any adjournment or postponement thereof. You may also vote by internet voting at https://vote.odysseytrust.com not less than 48 hours, excluding Saturdays, Sundays and statutory holidays, preceding the Meeting or any adjournment or postponement thereof. If you vote through the internet, you may also appoint another person to be your proxyholder. You will require your 12-digit control number found on your Proxy. In each case, proxies must be received not later than 2:00 p.m. (Pacific time) on Monday, December 16, 2024, or at least 48 hours (excluding Saturdays, Sundays, and holidays), before the time for holding the Meeting or any adjournment thereof.
To Vote Your Proxy Online please visit:
https://vote.odysseytrust.com where you will be required to enter the CONTROL NUMBER, which is printed on your Proxy. If you vote by Internet, do not mail the Proxy.
Returning your Proxy Form
To be effective, we must receive your completed proxy form or voting instruction no later than 2:00 p.m. (Vancouver time) on Monday, December 16, 2024. If the Meeting is postponed or adjourned, we must receive your completed
form of proxy by 5:00 p.m. (Pacific Time), two full business days before any adjourned or postponed Meeting at which the proxy is to be used. Late proxies may be accepted or rejected by the Chairman of the Meeting at his discretion and he is under no obligation to accept or reject a late proxy. The Chairman of the Meeting may waive or extend the proxy cut-off without notice.
ADVICE TO BENEFICIAL SHAREHOLDERS
The information set forth in this section is of significant importance to many Shareholders as a substantial number of Shareholders do not hold shares in their own name.
Shareholders who do not hold their shares in their own name (referred to in this circular as “Beneficial Shareholders”) should note that only proxies deposited by Registered Shareholders whose names appear on the records of the Company as the registered holders of Common Shares can be recognized and acted upon at the Meeting.
If shares are listed in an account statement provided to a Shareholder by an intermediary, such as a brokerage firm, then, in almost all cases, those shares will not be registered in the Shareholder’s name on the records of the Company. Such shares will more likely be registered under the name of the Shareholder’s intermediary or an agent of that intermediary, and consequently the Shareholder will be a Beneficial Shareholder. In Canada, the vast majority of such shares are registered under the name CDS & Co. (being the registration name for the Canadian Depositary for Securities, which acts as nominee for many Canadian brokerage firms). The shares held by intermediaries or their agents or nominees can only be voted (for or against resolutions) upon the instructions of the Beneficial Shareholder. Without specific instructions, an intermediary and its agents are prohibited from voting shares for the intermediary’s clients. Therefore, Beneficial Shareholders should ensure that instructions respecting the voting of their shares are communicated to the appropriate person.
Applicable regulatory rules require intermediaries/brokers to seek voting instructions from Beneficial Shareholders in advance of Shareholders’ meetings. Every intermediary/broker has its own mailing procedures and provides its own return instructions to clients, which should be carefully followed by Beneficial Shareholders in order to ensure that their shares are voted at the Meeting. The purpose of the form of proxy or voting instruction form provided to a Beneficial Shareholder by its broker, agent or nominee is limited to instructing the registered holder of the shares on how to vote such shares on behalf of the Beneficial Shareholder.
There are two kinds of Beneficial Shareholders, those who object to their name being made known to the issuers of securities which they own (“OBOs” for Objecting Beneficial Owners) and those who do not object to the issuers of the securities they own knowing who they are (“NOBOs” for Non-Objecting Beneficial Owners).
Although Beneficial Shareholders may not be recognized directly at the Meeting for the purpose of voting shares registered in the name of their broker, agent or nominee, a Beneficial Shareholder may attend the Meeting as a Proxyholder for a Registered Shareholder and vote their shares in that capacity. Beneficial Shareholders who wish to attend the Meeting and indirectly vote their shares as Proxyholder for a Registered Shareholder should contact their broker, agent or nominee well in advance of the Meeting to determine the steps necessary to permit them to indirectly vote their shares as a Proxyholder.
Non-Objecting Beneficial Owners
Pursuant to National Instrument 54-101 – Communication with Beneficial Owners of Securities of a Reporting Issuer (“NI 54-101”), issuers can obtain a list of their NOBOs from intermediaries for distribution of proxy-related materials directly to NOBOs. This year, the Company will not rely on those provisions of NI 54-101 that permit it to directly deliver proxy-related materials to its NOBOs. As a result, NOBOs can expect to receive a scannable voting instruction form (“VIF”) from Broadridge Investor Communications (“Broadridge”). These VIFs are to be completed and returned to Broadridge in accordance with the instructions provided on the VIF. Broadridge will tabulate the results of the VIFs received from NOBOs and will provide appropriate instructions at the Meeting with respect to the shares represented by the VIFs they receive.
If you are a Beneficial Shareholder and the Company or its agent has sent these proxy-related materials to you directly, please be advised that your name, address and information about your holdings of securities have been obtained in accordance with applicable securities regulatory requirements from the intermediary holding your securities on your behalf.
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Objecting Beneficial Owners
Applicable regulatory rules require intermediaries to seek voting instructions from OBOs in advance of Shareholders' meetings. Every intermediary has its own mailing procedures and provides its own return instructions to clients, which should be carefully followed by OBOs in order to ensure that their shares are voted at the Meeting. The purpose of the form of proxy or voting instruction form provided to an OBO by its broker, agent or nominee is limited to instructing the registered holder of the shares on how to vote such shares on behalf of the OBO. Beneficial Shareholders who are OBOs should follow the instructions of their intermediary carefully to ensure that their shares are voted at the Meeting.
The form of proxy provided to OBOs by intermediaries will be similar to the Proxy provided to Registered Shareholders. However, its purpose is limited to instructing the intermediary on how to vote your shares on your behalf. The majority of intermediaries now delegate responsibility for obtaining instructions from OBOs to Broadridge. Broadridge typically supplies VIFs, mails those forms to OBOs, and asks those OBOs to return the forms to Broadridge or follow specific telephonic or other voting procedures. Broadridge then tabulates the results of all instructions received by it and provides appropriate instructions respecting the voting of the shares to be represented at the meeting. An OBO receiving a VIF from Broadridge cannot use that form to vote shares directly at the Meeting. Instead, the VIF must be returned to Broadridge or the alternate voting procedures must be completed well in advance of the Meeting in order to ensure that such shares are voted.
The Company does not intend to pay for intermediaries to deliver these securityholder materials to OBOs and, as a result, OBOs will not be sent paper copies unless their intermediary assumes the costs.
United States Shareholders
This solicitation of Proxies and VIFs involves securities of a company located in Canada and is being effected in accordance with the corporate and securities laws of the province of British Columbia, Canada. The proxy solicitation rules under the United States Securities Exchange Act of 1934, as amended (the "Exchange Act"), are not applicable to the Company or this solicitation. Shareholders should be aware that disclosure and proxy solicitation requirements under the securities laws of British Columbia, Canada differ from the disclosure and proxy solicitation requirements under United States securities laws. The enforcement by Shareholders of civil liabilities under United States federal securities laws may be affected adversely by the fact that the Company is incorporated under the Business Corporations Act (British Columbia), its directors and its executive officers are residents of Australia and a substantial portion of its assets and the assets of such persons are located outside the United States. Shareholders may not be able to sue a foreign company or its officers or directors in a foreign court for violations of United States federal securities laws. It may be difficult to compel a foreign company and its officers and directors to subject themselves to a judgment by a United States court.
Notice-and-Access
The Company is not relying on the notice-and-access delivery procedures outlined in NI 54-101 to distribute copies of the Circular, Proxy or VIF.
INTEREST OF CERTAIN PERSONS OR COMPANIES IN MATTERS TO BE ACTED UPON
None of the directors ("Directors") or executive officers ("Officers") of the Company, at any time since the beginning of the Company's last financial year, nor any proposed nominee for election as a Director, or any associate or affiliate of the foregoing persons, has any material interest, direct or indirect, by way of beneficialownership of securities or otherwise, in any matters to be acted upon at the Meeting, exclusive of the election of Directors.
RECORD DATE, VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
A Shareholder of record at the close of business on November 5, 2024 (the "Record Date") who either personally attends the Meeting or who has completed and delivered a Proxy in the manner and subject to the provisions described above, shall be entitled to vote or to have such Shareholder's shares voted at the Meeting, or any adjournment thereof.
The Company's authorized capital consists of an unlimited number of common shares ("Common Shares") without par value and an unlimited number of preferred shares, issuable in series ("Preferred Shares"). As at the Record
Date, the Company has 135,047,305 Common Shares issued and outstanding, each share carrying the right to one vote. There are no Preferred Shares outstanding.
Principal Holders of Voting Securities
To the best of knowledge of the Directors and Officers, as of the date of this Circular, no persons or corporations beneficially own, directly or indirectly, or exercise control or direction over, Common Shares carrying more than 10% of the voting rights attached to all outstanding Common Shares.
EXECUTIVE COMPENSATION
For the purposes of this Circular, a Named Executive Officer (“NEO”) of the Company means each of the chief executive officer (“CEO”) of the Company, the chief financial officer (“CFO”) of the Company, and each of the most highly compensated executive officers, other than the CEO or CFO, whose total compensation was more than $150,000 for that financial year.
Statement of Executive Compensation
The following information regarding executive compensation is presented in accordance with National Instrument Form 51-102F6V – Statement of Executive Compensation and sets forth compensation for each of the NEOs and directors of the Company for the two most recently completed financial years. Unless otherwise noted, all dollar figures are expressed in Canadian dollars.
Director and NEO Compensation, Excluding Compensation Securities
The following table sets out all compensation paid, payable, awarded, granted, given, or otherwise provided, directly or indirectly, by the Company to each NEO, in any capacity, and each Director, during the two most recently completed financial years ending June 30, 2024 and 2023.
| Table of Compensation Excluding Compensation Securities | |||||||
|---|---|---|---|---|---|---|---|
| Name and position | Year(1) | Salary, consulting fee, retainer or commission ($) | Bonus ($) | Committee or meeting fees ($) | Value of perquisites ($) | Value of all other compensation ($) | Total compensation ($) |
| Justin Hanka | |||||||
| CEO and Director | 2024 | 49,000 | Nil | Nil | Nil | Nil | 49,000 |
| 2023 | Nil | Nil | Nil | Nil | Nil | Nil | |
| John Dinan | |||||||
| CFO | 2024 | 72,833 | Nil | Nil | Nil | Nil | 72,833 |
| 2023 | Nil | Nil | Nil | Nil | Nil | Nil | |
| Gavin Upiter | |||||||
| Director | 2024 | Nil | Nil | Nil | Nil | Nil | Nil |
| 2023 | Nil | Nil | Nil | Nil | Nil | Nil | |
| Zena Burgess | |||||||
| Director | 2024 | Nil | Nil | Nil | Nil | Nil | Nil |
| 2023 | Nil | Nil | Nil | Nil | Nil | Nil |
(1) Financial Year ended June 30.
Stock Options and Other Compensation Securities
No NEO or Director of the Company was granted stock options or other compensation securities of the Company in
the financial year ended June 30, 2024.
As at the end of the Company’s most recently completed financial year, being June 30, 2024, the following Options were outstanding to NEOs and Directors:
- Justin Hanka, Director and CEO of the Company, held an aggregate of 6,652,365 Options exercisable into Common Shares at a price of $0.10 per share until May 1, 2026, with such Options being held by Accelerative Investments Pty Ltd., a company controlled by Mr. Hanka;
- John Dinan, CFO of the Company, held 400,000 Options exercisable into Common Shares at a price of $0.10 per share until May 1, 2026;
- Gavin Upiter, a Director of the Company, held 444,409 Options exercisable into Common Shares at a price of $0.10 per share until May 1, 2026; and
- Zena Burgess, a Director of the Company, held 444,409 Options exercisable into Common Shares at a price of $0.10 per share until May 1, 2026.
Exercise of Compensation Securities by Directors and NEOs
No NEO or Director of the Company exercised compensation securities in the two most recently completed financial years ended June 30, 2024 and 2023.
Stock Option Plans and Other Incentive Plans
The Company has adopted a stock option plan (the “Option Plan”) pursuant to which the Board of Directors of the Company (the “Board”) may grant options (the “Options”) to purchase Common Shares to NEOs, Directors, employees and consultants of the Company (“Optionees”) or any of its subsidiaries or affiliates. The purpose of the Option Plan is to advance the interests of the Company by encouraging the directors, officers, employees and consultants of the Company or any of its subsidiaries or affiliates to acquire Common Shares, thereby: (i) increasing the proprietary interests of such persons in the Company; (ii) aligning the interests of such persons with the interests of the Company’s shareholders generally; (iii) encouraging such persons to remain associated with the Company or any of its subsidiaries or affiliates; and (iv) furnishing such persons with an additional incentive in their efforts on behalf of the Company or any of its subsidiaries or affiliates.
The Option Plan is a 20% fixed plan, pursuant to which the aggregate number of Common Shares reserved for issuance under the Option Plan, together with any other security based compensation arrangement of the Company, is equal to 20% of the aggregate Common Shares issued and outstanding as of the time of approval of the Option Plan (calculated on a non-diluted basis), unless the Company receives the permission of any stock exchange on which the Common Shares are listed to exceed such threshold.
At the time the Option Plan was implemented, there were a total of 133,047,305 Common Shares issued and outstanding, and 26,604,461 Options are therefore authorized for issuance pursuant to the Option Plan. If any Options granted under the Option Plan expire or terminate for any reason without having been exercised in full, any unpurchased Common Shares to which such Options relate shall be available for the purposes of granting Options under the Option Plan.
Additional terms of the Option Plan include:
(a) Options may not be granted to any one Optionee entitling that Optionee to acquire more than 5% of the issued and outstanding Common Shares in any 12-month period (unless disinterested shareholder approval is obtained);
(b) Options may not be granted to any one consultant entitling that consultant to acquire more than 2% of the issued and outstanding Common Shares in any 12-month period;
(c) Options may not be granted to any one person conducting investor relations activities entitling that person to acquire more than an aggregate of 2% of the issued and outstanding Common Shares persons in any 12-month period;
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(d) the Company must obtain disinterested shareholder approval where, together with all of the Company's previously established and outstanding stock option plans or grants: (i) the number of Common Shares reserved for issuance under stock options granted to insiders exceeds 10% of the issued and outstanding Common Shares; (ii) the grant to insiders, within any 12-month period, of Options entitling those insiders to acquire more than 10% of the issued and outstanding Common Shares; or (iii) the grant to any one Optionee, within a 12-month period, of Options entitling that Optionee to acquire more than 5% of the issued and outstanding Common Shares;
(e) no Option is exercisable for a period exceeding five (5) years from the date the Option is granted unless the Company receives permission of any stock exchange on which the Common Shares are listed and as specifically provided by the Board;
(f) Options granted to consultants performing investor relations activities on the Corporation's behalf must vest in stages over a period of 12 months with no more than 1/4 of the Options vesting in any three (3) month period;
(g) no Option in respect of which shareholder approval is required under the rules of any stock exchange on which the Common Shares are listed shall be exercisable until such time as the Option has been approved by the shareholders of the Company;
(h) the Board may, subject to the receipt of any necessary regulatory or stock exchange approvals, in its sole discretion, accelerate the time at which any Option may be exercised, in whole or in part; and
(i) any Options granted to any Optionee must expire within 60 days after the Optionee ceases to be an Optionee, and within 30 days for any Optionee engaged in investor relations activities after such Optionee ceases to be engaged to provide investor relations activities.
Options are non-assignable and are subject to early termination in the event of the death of a participant or in the event a participant ceases to be a NEO, Director, employee, consultant, affiliate, or subsidiary of the Company, as the case may be. Subject to the foregoing restrictions, and certain other restrictions set out in the Option Plan, the Board is authorized to provide for the granting of Options and the exercise and method of exercise of options granted under the Option Plan.
Employment, Consulting and Management Agreements
Management functions of the Company are not, to any substantial degree, performed other than by Directors or NEOs of the Company. There are no agreements or arrangements that provide for compensation to NEOs or Directors of the Company, or that provide for payments to a NEO or Director at, following or in connection with any termination (whether voluntary, involuntary or constructive), resignation, retirement, severance, a change of control in the Company or a change in the NEO or Director's responsibilities, other than as follows:
- The Company's wholly-owned subsidiary, Mind Therapeutics Pty Ltd. ("MTPL"), entered into a service agreement (the "Service Agreement") on May 12, 2021 with 958 Consulting Pty Ltd. ("958"), a company controlled by Justin Hanka, the CEO of the Company. Pursuant to the Service Agreement, 958 provides services in relation to a range of projects and activities involved in the operation of MTPL in exchange for a monthly retainer of AUD$10,000, which to date has been waived and is not accruing. The Service Agreement has a minimum term of five years from the date of the Company's listing on the Canadian Securities Exchange, which occurred on May 5, 2023, whereafter it can be terminated by MTPL or 958 on six months written notice. The Service Agreement does not contain any provisions with respect to change of control, severance, termination or constructive dismissal.
Oversight and Description of Director and NEO Compensation
Compensation of Directors
Compensation of Directors of the Company is reviewed annually. The level of compensation for Directors is determined after consideration of various relevant factors, including the expected nature and quantity of duties and
responsibilities, past performance, comparison with compensation paid by other issuers of comparable size and nature, and the availability of financial resources.
In the Board's view, there is, and has been, no need for the Company to design or implement a formal compensation program for Directors. While the Board considers Option grants to Directors under the Option Plan from time to time, the Board does not employ a prescribed methodology when determining the grant or allocation of Options. Other than the Option Plan, as discussed above, the Company does not offer any long-term incentive plans, share compensation plans or any other such benefit programs for Directors.
Compensation of NEOs
Compensation of NEOs is reviewed annually and determined by the Board. The level of compensation for NEOs is determined after consideration of various relevant factors, including the expected nature and quantity of duties and responsibilities, past performance, comparison with compensation paid by other issuers of comparable size and nature, and the availability of financial resources.
Elements of NEO Compensation
As discussed above, the Company provides an Option Plan to motivate NEOs by providing them with the opportunity, through Options, to acquire an interest in the Company and benefit from the Company's growth. The Board does not employ a prescribed methodology when determining the grant or allocation of Options to NEOs. Other than the Option Plan, the Company does not offer any long-term incentive plans, share compensation plans, retirement plans, pension plans, or any other such benefit programs for NEOs.
Pension Plan Benefits
No pension, retirement or deferred compensation plans, including defined contribution plans, have been instituted by the Company and none are proposed at this time.
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLAN
The following table sets forth information with respect to all compensation plans under which equity securities are authorized for issuance as of June 30, 2024:
| Equity Compensation Plan Information | |||
|---|---|---|---|
| Plan Category | Number of securities to be issued upon exercise of outstanding options, warrants and rights | ||
| (a) | Weighted-average exercise price of outstanding options, warrants and rights | ||
| (b) | Number of securities remaining available for future issuance under equity compensation plans excluding securities reflected in column (a) | ||
| (c) | |||
| Equity compensation plans approved by securityholders | Nil | N/A | N/A |
| Equity compensation plans not approved by securityholders(1) | 26,593,250 | $0.10 | Nil |
| TOTAL | 26,593,250 | $0.10 | 16,211 |
(1) Represents the Option Plan, which reserves a number of Common Shares equal to 20% of the number of Common Shares outstanding at the time the Option Plan was approved, being 133,047,305 Common Shares, for issue pursuant to equity incentives contemplated by the Option Plan.
INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS
As of the date hereof, other than indebtedness that has been entirely repaid on or before the date of this information circular or "routine indebtedness" as defined in Form 51-102F5 of National Instrument 51-102 none of:
(a) the individuals who are, or at any time since the beginning of the last financial year of the Company were, a director or executive officer of the Company;
(b) the proposed nominees for election as a director of the Company; or
(c) any associates of the foregoing persons,
is, or at any time since the beginning of the most recently completed financial year has been, indebted to the Company or any subsidiary of the Company, or is a person whose indebtedness to another entity is, or at any time since the beginning of the most recently completed financial year has been, the subject of a guarantee support agreement, letter of credit or other similar arrangement or understanding provided by the Company or any subsidiary of the Company.
INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS
For purposes of the following discussion, “Informed Person” means (a) a Director or executive officer of the Company; (b) a director or executive officer of a person or company that is itself an Informed Person or a subsidiary of the Company; (c) any person or company who beneficially owns, or controls or directs, directly or indirectly, voting securities of the Company or a combination of both carrying more than 10 percent of the voting rights attached to all outstanding voting securities of the Company, other than the voting securities held by the person or company as underwriter in the course of a distribution; and (d) the Company itself if it has purchased, redeemed or otherwise acquired any of its securities, for so long as it holds any of its securities.
Except as disclosed elsewhere herein or in the notes to the Company’s financial statements for the financial years ended June 30, 2024 and 2023, none of
(a) the Informed Persons of the Company;
(b) the proposed nominees for election as a Director; or
(c) any associate or affiliate of the foregoing persons,
has any material interest, direct or indirect, in any transaction since the commencement of the Company’s most recently completed financial year or in a proposed transaction which has materially affected or would materially affect the Company or any subsidiary of the Company.
APPOINTMENT OF AUDITOR
MNP LLP is the Company’s auditor and was appointed as the Company’s auditor on April 15, 2020. Management is recommending the re-appointment of MNP LLP as Auditor for the Company, to hold office until the next annual general meeting of the Shareholders at a remuneration to be fixed by the Board of Directors.
MANAGEMENT CONTRACTS
Except as disclosed herein, the Company is not a party to a Management Contract whereby management functions are to any substantial degree performed other than by the directors or executive officers of the Company.
PARTICULARS OF MATTERS TO BE ACTED UPON
Presentation of Financial Statements
The audited consolidated financial statements of the Company for the financial years ended June 30, 2024 and 2023 (the “Financial Statements”), together with the auditor’s report (the “Auditor’s Report”) thereon will be presented to Shareholders at the Meeting, but no vote thereon is required. The Financial Statements, Auditor’s Report and management’s discussion and analysis (the “MD&A”) for the financial years ended June 30, 2024 and 2023 are available under the Company’s profile on SEDAR+ at www.sedarplus.ca.
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Appointment and Remuneration of Auditor
At the Meeting, Shareholders will be asked to approve the appointment of MNP LLP as the auditor of the Company to hold office until the next annual general meeting of the Shareholders at remuneration to be determined by the Board.
In the absence of instructions to the contrary, the Proxyholders intend to vote the Common Shares represented by each Proxy, properly executed, FOR appointing MNP LLP as the Company’s independent auditor for the ensuing year, and FOR authorizing the Board to fix the auditor’s pay.
Fixing the Number of Directors
The Board presently consists of three Directors and Management proposes, and the persons named in the Proxy intend to vote in favour of fixing the number of Directors for the ensuing year at three (3).
In the absence of instructions to the contrary, the Proxyholders intend to vote the Common Shares represented by each Proxy, properly executed, FOR fixing the number of Directors at three (3) for the ensuing year.
Election of Directors
Each Director of the Company is elected annually and holds office until the next annual general meeting of Shareholders or until his or her successor is duly elected, unless his or her office is earlier vacated in accordance with the Articles of the Company. Although Management is nominating three (3) individuals to stand for election, the names of further nominees for Directors may come from the floor at the Meeting. Management does not contemplate that any of the nominees will be unable to serve as a Director.
In the absence of instructions to the contrary, the Proxyholders intend to the vote the Common Shares represented by each Proxy, properly executed, FOR the nominees herein listed.
Information Concerning Nominees Submitted by Management
The following table sets out the names of the persons nominated by Management for election as a Director, the province or state and country in which he is ordinarily resident, the positions and offices which each presently holds with the Company, the period of time for which he has been a director of the Company, the respective principal occupations or employment during the past five years if such nominee is not presently an elected director and the number of shares of the Company which each beneficially owns, directly or indirectly, or over which control or direction is exercised as of the date of this Circular. Each of the nominees are currently directors of the Company. Management does not contemplate that any of the nominees will be unable to continue to serve as a Director. In the event that a nominee is unable to serve for any reason, prior to the election, the Proxyholders reserve the right to vote for another candidate of their choice unless otherwise instructed by the Shareholder in the Proxy.
| Name, Province and Country of ordinary residence, and positions held with the Company^{(1)} | Principal occupation during the past five years^{(1)} | Director since^{(2)} | No. of shares beneficially owned or controlled^{(1)} |
|---|---|---|---|
| Justin Hanka^{(4)} | |||
| Victoria, Australia | |||
| CEO and Director | Co-founder and CEO of the Company since September 2020; Co-founder and CEO of Hardenbrook Group, a merchant and investment banking firm, since November 2021. | May 12, 2021 | 7,641,038^{(3)} |
| Gavin Upiter^{(4)} | |||
| Melbourne, Australia | |||
| Director & Chair | Founder and Managing Director of Director of Directo, an online marketplace connecting pharmacy buyers and sellers, since 2017; Managing Director at Evolution Pharmaceutical Services, a pharmaceutical advisory firm, since 2012. | June 23, 2021 | Nil |
| Zena Burgess^{(4)} | |||
| Melbourne, Australia | |||
| Director | CEO of Australian Psychological Society since July 2020, CEO of the Royal Australian College of General Practitioners from 2008 to November 2019. | June 23, 2021 | 133,995 |
(1) The information as to ordinary residence, principal occupation and number of common shares of the Company beneficially owned, or controlled or directed, directly or indirectly, by the nominee director and his or her associates and affiliates, not being within the knowledge of the Company, has been furnished by the respective nominees. Information provided as at the Record Date.
(2) The Company does not set expiry dates for the terms of office of Directors. Each Director holds office as long as he is elected annually by Shareholders at annual general meetings, unless his office is earlier vacated in accordance with the Articles of the Company.
(3) 7,242,690 Common Shares are held by Accelerative Investments Pty Ltd. AFT Hanka Family Trust. and 398,348 Common Shares are held by Hanka Super Corp.
(4) Member of the Audit Committee of the Company.
Cease Trade Orders, Corporate and Personal Bankruptcies, Penalties and Sanctions
For purposes of the disclosure in this section, an “order” means a cease trade order, an order similar to a cease trade order, or an order that denied the relevant company access to any exemption under securities legislation, in each case that was in effect for a period of more than 30 consecutive days; and for purposes of item (a)(i) below, specifically includes a management cease trade order which applies to directors or executive officers of a relevant company that was in effect for a period of more than 30 consecutive days whether or not the proposed director was named in the order.
To the best of knowledge of the Company except as noted below, none of the proposed directors, including any personal holding company of a proposed director:
(a) is, as at the date of this Circular, or has been, within the 10 years before the date of this Circular, a director, chief executive officer or chief financial officer of any company (including the Company) that:
(i) was subject to an order that was issued while the proposed director was acting in the capacity as a director, chief executive officer or chief financial officer of the company; or
(ii) was subject to an order that was issued after the proposed director ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as a director, chief executive officer or chief financial officer of the company; or
(b) is, as at the date of this Circular, or has been, within the 10 years before the date of this Circular, a director or executive officer of any company (including the Company) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or was subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold its assets;
(c) has, within the 10 years before the date of this Circular, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the proposed director;
(d) has been subject to any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority since December 31, 2000, or before December 31, 2000 if the disclosure of which would likely be important to a reasonable security holder in deciding whether to vote for a proposed director, or
(e) has been subject to any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable security holder in deciding whether to vote for a proposed director.
OTHER MATTERS
As of the date of this circular, Management knows of no other matters to be acted upon at the Meeting. However, should any other matters properly come before the Meeting, the shares represented by the proxy solicited hereby will be voted on such matters in accordance with the best judgment of the persons voting the shares represented by the proxy.
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12
AUDIT COMMITTEE DISCLOSURE
The Charter of the Company’s Audit Committee and other information required to be disclosed by Form 52-110F2 is attached to this Circular as Schedule “A”.
CORPORATE GOVERNANCE DISCLOSURE
The information required to be disclosed by National Instrument 58-101 Disclosure of Corporate Governance Practices is attached to this Circular as Schedule “B”.
ADDITIONAL INFORMATION
Additional information relating to the Company is available on SEDAR+ at www.sedarplus.ca. Copies of the Company’s Financial Statements and Management Discussion and Analysis may be obtained without charge upon request from the Company’s registered office located at Suite 1500, 1055 West Georgia St. Po Box 11117, Vancouver, British Columbia, V6E 4N7.
DIRECTOR APPROVAL
The contents of this Circular and the sending thereof to the Shareholders of the Company have been approved by the Board.
DATED this 5th day of November, 2024
BY ORDER OF THE BOARD OF DIRECTORS
MINDBIO THERAPEUTICS CORP.
“Justin Hanka”
Justin Hanka
Chief Executive Officer
SCHEDULE “A”
FORM 52-110F2
AUDIT COMMITTEE DISCLOSURE
(VENTURE ISSUERS)
Item 1: The Audit Committee Charter
The Audit Committee (the “Committee”) is a committee of the board of directors (the “Board”) of the MindBio Therapeutics Corp. (the “Company”). The role of the Committee is to provide oversight of the Company’s financial management and of the design and implementation of an effective system of internal financial controls as well as to review and report to the Board on the integrity of the financial statements of the Company, its subsidiaries and associated companies. This includes helping directors meet their responsibilities, facilitating better communication between directors and the external auditor, enhancing the independence of the external auditor, increasing the credibility and objectivity of financial reports and strengthening the role of the directors by facilitating in-depth discussions among directors, management and the external auditor. Management is responsible for establishing and maintaining those controls, procedures and processes and the Committee is appointed by the Board to review and monitor them. The Company's external auditor is ultimately accountable to the Board and the Committee as representatives of the Company's shareholders.
Duties and Responsibilities
External Auditor
(a) To recommend to the Board, for shareholder approval, an external auditor to examine the Company's accounts, controls and financial statements on the basis that the external auditor is accountable to the Board and the Committee as representatives of the shareholders of the Company.
(b) To oversee the work of the external auditor engaged for the purpose of preparing or issuing an auditor's report or performing other audit, review or attest services for the Company, including the resolution of disagreements between management and the external auditor regarding financial reporting.
(c) To evaluate the audit services provided by the external auditor, pre-approve all audit fees and recommend to the Board, if necessary, the replacement of the external auditor.
(d) To pre-approve any non-audit services to be provided to the Company by the external auditor and the fees for those services.
(e) To obtain and review, at least annually, a written report by the external auditor setting out the auditor's internal quality-control procedures, any material issues raised by the auditor's internal quality-control reviews and the steps taken to resolve those issues.
(f) To review and approve the Company's hiring policies regarding partners, employees and former partners and employees of the present and former external auditor of the Company. The Committee has adopted the following guidelines regarding the hiring of any partner, employee, reviewing tax professional or other person providing audit assurance to the external auditor of the Company on any aspect of its certification of the Company's financial statements:
(i) No member of the audit team that is auditing a business of the Company can be hired into that business or into a position to which that business reports for a period of three years after the audit;
(ii) No former partner or employee of the external auditor may be made an officer of the Company or any of its subsidiaries for three years following the end of the individual's association with the external auditor;
(iii) The Chief Financial Officer (“CFO”) must approve all office hires from the external auditor; and
(iv) The CFO must report annually to the Committee on any hires within these guidelines during the preceding year.
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(g) To review, at least annually, the relationships between the Company and the external auditor in order to establish the independence of the external auditor.
Financial Information and Reporting
(a) To review the Company’s annual audited financial statements with the Chief Executive Officer (“CEO”) and CFO and then the full Board. The Committee will review the interim financial statements with the CEO and CFO.
(b) To review and discuss with management and the external auditor, as appropriate:
(i) The annual audited financial statements and the interim financial statements, including the accompanying management discussion and analysis; and
(ii) Earnings guidance and other releases containing information taken from the Company’s financial statements prior to their release.
(c) To review the quality and not just the acceptability of the Company’s financial reporting and accounting standards and principles and any proposed material changes to them or their application.
(d) To review with the CFO any earnings guidance to be issued by the Company and any news release containing financial information taken from the Company’s financial statements prior to the release of the financial statements to the public. In addition, the CFO must review with the Committee the substance of any presentations to analysts or rating agencies that contain a change in strategy or outlook.
Oversight
(a) To review the internal audit staff functions, including:
(i) The purpose, authority and organizational reporting lines;
(ii) The annual audit plan, budget and staffing; and
(iii) The appointment and compensation of the controller, if any.
(b) To review, with the CFO and others, as appropriate, the Company’s internal system of audit controls and the results of internal audits.
(c) To review and monitor the Company’s major financial risks and risk management policies and the steps taken by management to mitigate those risks.
(d) To meet at least annually with management (including the CFO), the internal audit staff, and the external auditor in separate executive sessions and review issues and matters of concern respecting audits and financial reporting.
(e) In connection with its review of the annual audited financial statements and interim financial statements, the Committee will also review the process for the CEO and CFO certifications (if required by law or regulation) with respect to the financial statements and the Company’s disclosure and internal controls, including any material deficiencies or changes in those controls.
Membership
(a) The Committee shall consist solely of three or more members of the Board, the majority of which the Board has determined has no material relationship with the Company and is otherwise “unrelated” or “independent” as required under applicable securities rules or applicable stock exchange rules.
(b) Any member may be removed from office or replaced at any time by the Board and shall cease to be a member upon ceasing to be a director. Each member of the Committee shall hold office until the close of the next annual meeting of shareholders of the Company or until the member ceases to be a director, resigns or is replaced, whichever first occurs.
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(c) The members of the Committee shall be entitled to receive such remuneration for acting as members of the Committee as the Board may from time to time determine.
(d) All members of the Committee must be “financially literate” (i.e. have the ability to read and understand a set of financial statements such as a balance sheet, an income statement and a cash flow statement).
Procedures
(a) The Board shall appoint one of the directors elected to the Committee as the Chair of the Committee (the “Chair”). In the absence of the appointed Chair from any meeting of the Committee, the members shall elect a Chair from those in attendance to act as Chair of the meeting.
(b) The Chair will appoint a secretary (the “Secretary”) who will keep minutes of all meetings. The Secretary does not have to be a member of the Committee or a director and can be changed by simple notice from the Chair.
(c) No business may be transacted by the Committee except at a meeting of its members at which a quorum of the Committee is present or by resolution in writing signed by all the members of the Committee. A majority of the members of the Committee shall constitute a quorum, provided that if the number of members of the Committee is an even number, one-half of the number of members plus one shall constitute a quorum and provided that a majority of the members must be “independent” or “unrelated”.
(d) The Committee will meet as many times as is necessary to carry out its responsibilities. Any member of the Committee or the external auditor may call meetings.
(e) The time and place of the meetings of the Committee, the calling of meetings and the procedure in all respects of such meetings shall be determined by the Committee, unless otherwise provided for in the articles of the Company or otherwise determined by resolution of the Board.
(f) The Committee shall have the resources and authority necessary to discharge its duties and responsibilities, including the authority to select, retain, terminate, and approve the fees and other retention terms (including termination) of special counsel, advisors or other experts or consultants, as it deems appropriate.
(g) The Committee shall have access to any and all books and records of the Company necessary for the execution of the Committee's obligations and shall discuss with the CEO or the CFO such records and other matters considered appropriate.
(h) The Committee has the authority to communicate directly with the internal and external auditors.
Reports
The Committee shall produce the following reports and provide them to the Board:
(a) An annual performance evaluation of the Committee, which evaluation must compare the performance of the Committee with the requirements of this Charter. The performance evaluation should also recommend to the Board any improvements to this Charter deemed necessary or desirable by the Committee. The performance evaluation by the Committee shall be conducted in such manner as the Committee deems appropriate. The report to the Board may take the form of an oral report by the Chair or any other member of the Committee designated by the Committee to make this report.
(b) A summary of the actions taken at each Committee meeting, which shall be presented to the Board at the next Board meeting.
Item 2: Composition of the Audit Committee
National Instrument 52-110 Audit Committees, (“NI 52-110”) provides that a member of an audit committee is “independent” if the member has no direct or indirect material relationship with the Company, which could, in the view of the Company's Board, reasonably interfere with the exercise of the member's independent judgment.
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NI 52-110 provides that an individual is “financially literate” if he or she has the ability to read and understand a set of financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the Company's financial statements. The following sets out the members of the audit committee and their education and experience that is relevant to the performance of his responsibilities as an audit committee member.
The current members of the Audit Committee are Gavin Upiter, Justin Hanka and Zena Burgess, two of whom are independent (Mr. Upiter and Ms. Burgess) and all of whom are financially literate as defined by NI 52-110.
Item 3: Relevant Education and Experience
The Instrument provides that an individual is “financially literate” if he or she has the ability to read and understand a set of financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the Company’s financial statements.
All members of the Audit Committee are considered financially literate and have been involved in enterprises which publicly report financial results, each of which requires a working understanding of, and ability to analyze and assess, financial information (including financial statements).
Item 4: Audit Committee Oversight
At no time during the Company’s most recently completed financial year was a recommendation of the Audit Committee to nominate or compensate an external auditor (currently, MNP LLP) not adopted by the Board.
Item 5: Reliance on Certain Exemptions
During the most recently completed financial year, the Company has not relied on certain exemptions set out in NI 52-110, namely section 2.4 (De Minimus Non-audit Services), subsection 6.1.1(4) (Circumstance Affecting the Business or Operations of the Venture Issuer), subsection 6.1.1(5) (Events Outside Control of Member), subsection 6.1.1(6) (Death, Incapacity or Resignation), and any exemption, in whole or in part, in Part 8 (Exemptions).
Item 6: Pre-Approval Policies and Procedures
The Audit Committee has not adopted formal policies and procedures for the engagement of non-audit services. Subject to the requirements of the NI 52-110, the engagement of non-audit services is considered by, as applicable, the Board and the Audit Committee, on a case by case basis.
Item 7: External Auditor Service Fees (By Category)
The following table sets out the aggregate fees charged to the Company by the external auditor in each of the last two financial years for the category of fees described.
| FYE 2024 | FYE 2023 | |
|---|---|---|
| Audit Fees(1) | $69,323 | $83,746 |
| Audit-Related Fees(2) | - | - |
| Tax Fees(3) | - | - |
| All Other Fees(4) | - | - |
| Total Fees: | $69,323 | $83,746 |
- “Audit fees” include aggregate fees billed by the Company’s external auditor in each of the last three fiscal years for audit fees.
- “Audited related fees” include the aggregate fees billed in each of the last three fiscal years for assurance and related services by the Company’s external auditor that are reasonably related to the performance of the audit or review of the Company’s financial statements and are not reported under “Audit fees” above. The services provided include employee benefit audits, due diligence assistance, accounting consultations on proposed transactions, internal control reviews and audit or attest services not required by legislation or regulation.
-
"Tax fees" include the aggregate fees billed in each of the last three fiscal years for professional services rendered by the Company's external auditor for tax compliance, tax advice and tax planning. The services provided include tax planning and tax advice includes assistance with tax audits and appeals, tax advice related to mergers and acquisitions, and requests for rulings or technical advice from tax authorities.
-
"All other fees" include the aggregate fees billed in each of the last three fiscal years for products and services provided by the Company's external auditor, other than "Audit fees", "Audit related fees" and "Tax fees" above.
Item 8: Exemption
During the most recently completed financial year, the Company relied on the exemption set out in section 6.1 of NI 52-110 with respect to compliance with the requirements of Part 3 (Composition of the Audit Committee) and Part 5 (Reporting Obligations).
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SCHEDULE “B”
FORM 58-101F2
CORPORATE GOVERNANCE DISCLOSURE
(VENTURE ISSUERS)
Item 1: Board of Directors
The board of directors (the “Board”) of the Company facilitates its exercise of independent supervision over the Company’s management through frequent meetings of the Board.
| Director | Independence |
|---|---|
| Justin Hanka | Not independent, as he is the CEO of the Company |
| Gavin Upiter | Independent |
| Zena Burgess | Independent |
Item 2: Directorships
The current directors of the Company are currently directors of the following other reporting issuers:
| Name of Director | Name of Reporting Issuer |
|---|---|
| Justin Hanka | EonX Technologies Inc. |
| Blackhawk Growth Corp. | |
| EYEfi Group Technologies Inc. | |
| Gavin Upiter | None |
| Zena Burgess | None |
Item 3: Orientation and Continuing Education
The Board does not have a formal process for the orientation of new Board members. Orientation is done on an informal basis. New Board members are provided with such information as is considered necessary to ensure that they are familiar with the Company’s business and understand the responsibilities of the Board.
The Board does not have a formal program for the continuing education of its directors. The Company expects its directors to pursue such continuing education opportunities as may be required to ensure that they maintain the skill and knowledge necessary to fulfill their duties as members of the Board. Directors can consult with the Company’s professional advisors regarding their duties and responsibilities, as well as recent developments relevant to the Company and the Board.
Item 4: Ethical Business Conduct
The Board has not adopted a formal code of ethics. In the Board’s view, the fiduciary duties placed on individual directors by corporate legislation and the common law, and the restrictions placed by corporate legislation on an individual director's participation in decisions of the Board in which the director has an interest, have been sufficient to ensure that the Board operates independently of management and in the best interests of the Company.
Although the Company has not adopted a formal code of ethics, the Company promotes an ethical business culture. Directors and officers of the Company are encouraged to conduct themselves and the business of the Company with the utmost honesty and integrity. Directors are also encouraged to consult with the Company’s professional advisors with respect to any issues related to ethical business conduct.
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Item 5: Nomination of Directors
The identification of potential candidates for nomination as directors of the Company is primarily done by the CEO, but all directors are encouraged to participate in the identification and recruitment of new directors. Potential candidates are primarily identified through referrals by business contacts.
Item 6: Compensation
The compensation of directors and the CEO is reviewed and determined by the Compensation Committee. The level of compensation for NEOs is determined after consideration of various relevant factors, including the expected nature and quantity of duties and responsibilities, past performance, comparison with compensation paid by other issuers of comparable size and nature, and the availability of financial resources.
Item 7: Other Board Committees
The Company has established two committees, presently being the Audit Committee and a Compensation Committee. All Board decisions are made by full board of director meetings or consent resolutions.
Item 8: Assessments
The Board does not have any formal process for assessing the effectiveness of the Board, its committees, or individual directors. Such assessments are done on an informal basis by the CEO and the Board as a whole.
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