Announcement PDF Recce Pharmaceuticals Ltd Level 36, 1 Macquarie Place Gateway Tower Sydney NSW 2000 Recce Pharmaceuticals Ltd Notice of 2019 General Meeting Explanatory Statement | Proxy Form 30 September 2019 2.00pm AEST Address Automic Group Level 5, 126 Phillip Street Sydney NSW 2000 This Notice of Meeting should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisers prior to voting. Contents Venue and Voting Information 2 Notice of General Meeting – Resolutions 3 Notice of General Meeting – Explanatory Statement 5 Glossary 8 Proxy Form Attached Venue and Voting Information The General Meeting of the Shareholders to which this Notice of Meeting relates will be held at 2.00pm (AEST) on Monday, 30 September 2019 at Automic Group, Level 5, 126 Phillip Street, Sydney NSW 2000. Your vote is important The business of the General Meeting affects your shareholding and your vote is important. Voting in person To vote in person, attend the General Meeting on the date and at the place set out above. Voting by proxy To vote by proxy, please use one of the following methods: Online Lodge the Proxy Form online at https://investor.automic.com.au/#/loginsah by following the instructions: Login to the Automic website using the holding details as shown on the Proxy Form. Click on ‘View Meetings’ – ‘Vote’. To use the online lodgement facility, Shareholders will need their holder number (Securityholder Reference Number (SRN) or Holder Identification Number (HIN)) as shown on the front of the Proxy Form. By post Automic, GPO Box 5193, Sydney NSW 2001 By hand Automic, Level 5, 126 Phillip Street, Sydney NSW 2000 Your Proxy instruction must be received not later than 48 hours before the commencement of the Meeting. Proxy Forms received later than this time will be invalid. Power of Attorney If the proxy form is signed under a power of attorney on behalf of a shareholder, then the attorney must make sure that either the original power of attorney or a certified copy is sent with the proxy form, unless the power of attorney has already provided it to the Share Registry. Corporate Representatives If a representative of a corporate shareholder or a corporate proxy will be attending the Meeting, the representative should bring to the Meeting adequate evidence of their appointment, unless this has previously been provided to the Share Registry. Recce Pharmaceuticals Ltd | General Meeting – Notice of Meeting and Explanatory Statement 2 Notice of General Meeting Notice is hereby given that a General Meeting of Shareholders of Recce Pharmaceuticals Ltd ACN 124 849 065 will be held at 2.00pm (AEST) on Monday, 30 September 2019 at Automic Group, Level 5, 126 Phillip Street, Sydney NSW 2000 (Meeting). The Explanatory Statement to this Notice of Meeting provides additional information on matters to be considered at the General Meeting. The Explanatory Statement and the Proxy Form forms part of this Notice of Meeting. The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the General Meeting are those who are registered Shareholders at 2.00pm (AEST) on 28 September 2019. Terms and abbreviations used in this Notice of Meeting and Explanatory Statement are defined in the Glossary. Resolutions Ratification of Prior Issue of Equity Securities 1. Resolution 1 – Ratification of Prior Issue of Shares to Acuity Capital Pty Ltd To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution: “That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, the Shareholders ratify the allotment and prior issue of 4,500,000 fully paid ordinary shares issued to Acuity Capital Pty Ltd on 15 February 2019 and otherwise on the terms and conditions set out in the Explanatory Statement which accompanies and forms part of this Notice of Meeting.” Voting Exclusion Statement: The Company will disregard any votes cast in favour of Resolution 1 by or on behalf of: (a) a person who participated in the issue and received the Shares; or (b) an Associate of those persons. However, the Company will not disregard a vote if: (i) it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or (ii) it is cast by the Chair as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides. Recce Pharmaceuticals Ltd | General Meeting – Notice of Meeting and Explanatory Statement 3 2. Resolution 2 – Ratification of Prior Issue of Shares To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution: “That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, the Shareholders ratify the allotment and prior issue of 12,857,143 fully paid ordinary shares issued on 15 February 2019 and otherwise on the terms and conditions set out in the Explanatory Statement which accompanies and forms part of this Notice of Meeting.” Voting Exclusion Statement: The Company will disregard any votes cast in favour of Resolution 2 by or on behalf of: (a) a person who participated in the issue and received the Shares; or (b) an Associate of those persons. However, the Company will not disregard a vote if: 3. (i) it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or (ii) it is cast by the Chair as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides. Resolution 3 – Ratification of Prior Issue of Options to DJ Carmichael Pty Ltd To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution: “That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, the Shareholders ratify the allotment and prior issue of 1,800,000 unlisted options issued on 15 February 2019 and otherwise on the terms and conditions set out in the Explanatory Statement which accompanies and forms part of this Notice of Meeting.” Voting Exclusion Statement: The Company will disregard any votes cast in favour of Resolution 3 by or on behalf of: (a) a person who participated in the issue and received the Options; or (b) an Associate of those persons. However, the Company will not disregard a vote if: (i) it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or (ii) it is cast by the Chair as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides. BY ORDER OF THE BOARD Alistair McKeough Company Secretary Recce Pharmaceuticals Ltd | General Meeting – Notice of Meeting and Explanatory Statement 4 Explanatory Statement This Explanatory Statement has been prepared for the information of the Shareholders in connection with the business to be conducted at the General Meeting to be held at 2.00pm (AEST) on Monday, 30 September 2019 at Automic Group, Level 5, 126 Phillip Street, Sydney NSW 2000. The purpose of this Explanatory Statement is to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions in the Notice of Meeting. If you are in any doubt about what to do in relation to the Resolutions contemplated in the Notice of Meeting and this Explanatory Statement, it is recommended that you seek advice from an accountant, solicitor or other professional advisor. Full details of the business to be considered at the General Meeting are set out below. Resolutions Ratification of Prior Issue of Equity Securities Resolution 1 – Ratification of Prior Issue of Shares to Acuity Capital Pty Ltd Background As announced by the Company on 1 November 2018, the Company entered into a controlled placement deed (CPD) with Acuity Capital Pty Ltd (Acuity), providing the Company with up to $3 million of standby equity capital until 31 December 2020. The Company retains full control of all aspects of the placement process, having sole discretion as to whether or not to utilise the CPD, the quantum of issued shares, the minimum price of shares and the timing of each placement tranche (if any). There are no requirements on the Company to utilise the CPD and the Company may terminate the CPD at any time, without cost or penalty. As collateral for the CPD, the Company issued 4,500,000 fully paid ordinary shares on 15 February 2019 for nil consideration to Acuity. The Company may, at any time, cancel the CPD and buy back the Collateral Shares for no consideration (subject to shareholder approval). ASX Listing Rules 7.1 This Resolution proposes that Shareholders of the Company approve and ratify the prior issue and allotment of 4,500,000 Shares issued on 15 February 2019. All of the Shares were issued to Acuity by utilising the Company’s existing capacity under Listing Rule 7.1. Listing Rule 7.1 allows an entity to issue (or agree to issue) up to 15% of the Company’s fully paid ordinary shares on issue in any 12 month period without the approval of the Shareholders of the Company. Listing Rule 7.4 provides that where an entity in a general meeting ratifies the previous issue of securities made pursuant to Listing Rule 7.1 (and provided that the previous issue did not breach Listing Rule 7.1), those securities will be deemed to have been made with Shareholder approval for the purposes of Listing Rule 7.1, thereby “refreshing” the Company’s capacity under Listing Rule 7.1. Therefore, the effect of approval of this Resolution is to allow the entity to retain the flexibility to issue additional securities within the 15% capacity under Listing Rule 7.1 after this Resolution is adopted. Information required by ASX Listing Rule 7.5 The following information is provided to Shareholders for the purposes of Listing Rule 7.5. (a) The Company issued 4,500,000 fully paid ordinary shares. (b) Each of the Shares were issued for nil consideration. (c) The Shares were fully paid on issue and ranked equally in all aspects with all existing fully paid ordinary shares previously issued by the Company. Recce Pharmaceuticals Ltd | General Meeting – Notice of Meeting and Explanatory Statement 5 (d) The Shares were issued to Acuity Capital Pty Ltd. (e) Funds were not raised from the issue of the Shares as the Shares were issued as collateral shares pursuant to the CPD. Directors’ recommendation The Board of Directors recommend that Shareholders vote for this Resolution. Resolution 2 – Ratification of Prior Issue of Shares Background As announced by the Company on 15 February 2019, the Company successfully completed a placement to sophisticated and institutional investors (Placement) of 12,857,143 fully paid ordinary shares at an issue price of 14 cents ($0.14) per Share raising $1.8 million (before costs) for the Company. The funds raised will be used to strengthen the Company’s balance sheet as the Company advances its New Class of Broad Spectrum Antibiotic towards approval to start human clinical trials. In addition, the funds will be used to further preclinical programs, for general working capital and for the repayment of director loans. ASX Listing Rules 7.1 and 7.1A This Resolution proposes that Shareholders of the Company approve and ratify the prior issue and allotment of 12,857,143 Shares issued on 15 February 2019. The Placement was completed by utilising the Company’s existing capacity in which 7,114,553 Shares were issued under Listing Rule 7.1 and 5,742,590 Shares were issued under Listing Rule 7.1A. Listing Rule 7.1 allows an entity to issue (or agree to issue) up to 15% of the Company’s fully paid ordinary shares on issue in any 12 month period without the approval of the Shareholders of the Company. Listing Rule 7.1A provides that, in addition to issues permitted without prior Shareholder approval under Listing Rule 7.1, an entity that is eligible and obtains Shareholder approval under Listing Rule 7.1A may issue (or agree to issue) during the period for which the approval is valid a number of quoted equity securities which represents 10% of the number of fully paid ordinary securities on issue at the commencement of that 12 month period as adjusted in accordance with the formula in Listing Rule 7.1A. The Company is an eligible entity and sought and received Shareholder approval for this additional 10% capacity at the Company’s annual general meeting last year. Listing Rule 7.4 provides that where an entity in a general meeting ratifies the previous issue of securities made pursuant to Listing Rule 7.1 (and provided that the previous issue did not breach Listing Rule 7.1), those securities will be deemed to have been made with Shareholder approval under Listing Rule 7.1, thereby “refreshing” the Company’s capacity under Listing Rule 7.1. A note to Listing Rule 7.4 also provides it can also be used to ratify the previous issue of securities made with approval pursuant to Listing Rule 7.1A. Therefore, the effect of approval of this Resolution is to allow the entity to retain the flexibility to issue additional securities within the 15% capacity under Listing Rule 7.1 and the additional 10% capacity under Listing Rule 7.1A, after this Resolution is adopted. Information required by ASX Listing Rule 7.5 The following information is provided to Shareholders for the purposes of Listing Rule 7.5. (a) The Company issued 12,857,143 fully paid ordinary shares. (b) Each of the Shares were issued at $0.14 per Share. (c) The Shares were fully paid on issue and ranked equally in all aspects with all existing fully paid ordinary shares previously issued by the Company. (d) The Shares were issued to sophisticated and institutional investors. (e) Funds raised from the issue of the Shares have been and will be used by the Company to strengthen the Company’s balance sheet, to further pre-clinical programs, for general working capital and the Recce Pharmaceuticals Ltd | General Meeting – Notice of Meeting and Explanatory Statement 6 repayment of director loans. Directors’ recommendation The Board of Directors recommend that Shareholders vote for this Resolution. Resolution 3 – Ratification of Prior Issue of Options to DJ Carmichael Pty Ltd Background DJ Carmichael Pty Ltd (DJ Carmichael) was the lead manager of the Placement. Fees payable to DJ Carmichael in relation to the Placement include a cash payment of 6% of the total amount raised and the issue of 1,800,000 unlisted Options, which has an exercise price that is a 20% premium to the issue price of the shares offered under the Placement. Accordingly, on 15 February 2019, the Company issued 1,800,000 Options to DJ Carmichael. Each of the Options have an exercise price of $0.168 per Option and expire on 15 February 2023. ASX Listing Rules 7.1 This Resolution proposes that Shareholders of the Company approve and ratify the prior issue and allotment of 1,800,000 Options issued on 15 February 2019. All of the Options were issued to DJ Carmichael by utilising the Company’s existing capacity under Listing Rule 7.1. Listing Rule 7.1 allows an entity to issue (or agree to issue) up to 15% of the Company’s fully paid ordinary shares on issue in any 12 month period without the approval of the Shareholders of the Company. Listing Rule 7.4 provides that where an entity in a general meeting ratifies the previous issue of securities made pursuant to Listing Rule 7.1 (and provided that the previous issue did not breach Listing Rule 7.1), those securities will be deemed to have been made with Shareholder approval for the purposes of Listing Rule 7.1, thereby “refreshing” the Company’s capacity under Listing Rule 7.1. Therefore, the effect of approval of this Resolution is to allow the entity to retain the flexibility to issue additional securities within the 15% capacity under Listing Rule 7.1 after this Resolution is adopted. Information required by ASX Listing Rule 7.5 The following information is provided to Shareholders for the purposes of Listing Rule 7.5. (a) The Company issued 1,800,000 unlisted options. (b) Each of the Options were issued for nil consideration. (c) The Options have an exercise price of $0.168 per Option and expire on 15 February 2023. (d) The Options were issued to DJ Carmichael. (e) Funds were not raised from the issue of the Options as the Options were issued as part of the fees for DJ Carmichael acting as Lead Manager for the Placement. Directors’ recommendation The Board of Directors recommend that Shareholders vote for this Resolution. Enquiries Shareholders are asked to contact the Company Secretary on +61 2 8072 1400 if they have any queries in respect of the matters set out in these documents. Recce Pharmaceuticals Ltd | General Meeting – Notice of Meeting and Explanatory Statement 7 Glossary AEST means Australian Eastern Standard Time as observed in Sydney, New South Wales. ASIC means Australian Securities and Investments Commission. Associate has the meaning given to it by the ASX Listing Rules. ASX means ASX Limited ACN 008 624 691 or the financial market operated by it, as the context requires, of 20 Bridge Street, Sydney, NSW 2000. ASX Listing Rules or Listing Rules means the official ASX Listing Rules of the ASX and any other rules of the ASX which are applicable while the Company is admitted to the official list of the ASX, as amended or replaced from time to time, except to the extent of any express written waiver by the ASX. Board means the current board of Directors of the Company. Business Day means a day on which trading takes place on the stock market of ASX. Chair means the person chairing the Meeting. Company means Recce Pharmaceuticals Ltd ACN 124 849 065. Constitution means the Company’s constitution. Corporations Act means the Corporations Act 2001 (Cth) as amended or replaced from time to time. Director means a current director of the Company. Dollar or “$” means Australian dollars. Explanatory Statement means the explanatory statement accompanying this Notice of Meeting. General Meeting or Meeting means a General Meeting of the Company and, unless otherwise indicated, means the meeting of the Company’s members convened by this Notice of Meeting. Notice of Meeting means this notice of general meeting dated 30 August 2019 including the Explanatory Statement. Option means an option which, subject to its terms, could be exercised into a Share. Ordinary Resolution means a resolution that can only be passed if at least 50% of the total votes cast by Shareholders entitled to vote on the resolution are voted in its favour at the meeting. Proxy Form means the proxy form attached to this Notice of Meeting. Resolutions means the resolutions set out in this Notice of Meeting, or any one of them, as the context requires. Securities mean Shares and/or Options (as the context requires). Share means a fully paid ordinary share in the capital of the Company. Shareholder means a holder of a Share. Share Registry means Automic Group, Level 5, 126 Phillip Street Sydney NSW 2000. Recce Pharmaceuticals Ltd | General Meeting – Notice of Meeting and Explanatory Statement 8 [ReplaceNoImages] RCE ✓ ✓ ✓ RCE For / / ┘