TIDMMTFB
RNS Number : 0006Y
Motif Bio PLC
10 May 2021
Motif Bio plc
("Motif Bio" or the "Company")
2020 Annual Report and Accounts
Notice of Final Results
Motif Bio plc (AIM: MTFB) announces that the 2020 Annual Report
and Accounts are available for download from the Company's website
at www.motifbio.com. Motif Bio is a Cash Shell pursuant to AIM Rule
15.
Corporate Update
Throughout 2020, the Board engaged with multiple candidates and
explored numerous potential Reverse Takeover ('RTO') transactions.
The Board is now working towards completing the previously
announced RTO transaction with a UK based anti-body drug conjugate
drug discovery and development company.
Confidential marketing has begun for a fundraising to accompany
the RTO transaction. The Board expects that further details of the
transaction will be announced later in May with a General Meeting
and shareholder vote to follow thereafter.
In support of the transaction, the Board has agreed to forgo all
previously agreed cash incentives tied to the occurrence of an
RTO.
In preparation for the completion of the RTO, Jonathan Gold will
step down from his role as an Executive Director and become a
Non-Executive Director, with immediate effect. We thank Jonathan
for his leadership and collaboration with the Board in advancing
what we consider to be a compelling and value-creating RTO
opportunity for Motif's shareholders. Jonathan is expected to
continue as a Non-Executive Director of the enlarged group
following the completion of the RTO.
Bruce Williams, Chairman of Motif Bio, said: On behalf of the
Board, I wish to express our appreciation for the valued support
and patience of Motif's various stakeholders as we work to complete
the RTO.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
For further information please contact:
Motif Bio plc ir@motifbio.com
Jonathan Gold (Director)
SP Angel Corporate Finance LLP (NOMAD
& BROKER) +44 (0) 20 3470 0470
David Hignell/Caroline Rowe (Corporate
Finance)
Vadim Alexandre/Abigail Wayne (Sales
& Broking)
Walbrook PR Ltd. (UK FINANCIAL PR
& IR) +44 (0) 20 7933 8780
Paul McManus/ Lianne Cawthorne motifbio@walbrookpr.com
Forward-Looking Statements
When used in this Press Release, the words or phrases "intends,"
"anticipates," "expected to be" or similar expressions are intended
to identify "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements
are subject to certain risks and uncertainties including, but not
limited to, changes in economic conditions in the Company's market
area, changes in policies by regulatory agencies, fluctuations in
interest rates, competition that could cause actual results to
differ materially from historical earnings and those presently
anticipated or projected, and other risks described in the
Company's filings with the Securities and Exchange Commission. The
Company cautions readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made.
The Company advises readers that the factors listed above could
affect the Company's financial performance and could cause the
Company's actual results for future periods to differ materially
from any opinions or statements expressed with respect to future
periods in any current statements. The Company does not undertake,
and specifically disclaims any obligation, to publicly release the
result of any revision which may be made to any forward-looking
statements to reflect events or circumstances after the date of
such statements or to reflect the occurrence of anticipated or
unanticipated events.
Strategic Report
The Directors present their Strategic Report for the year ended
31 December 2020.
AIM Rule 15 Cash Shell Status
Effective 28 January 2020, the Company was reclassified as an
AIM Rule 15 cash shell. As such, the Company is required to make an
acquisition, or acquisitions, which constitutes a reverse takeover
under AIM Rule 14 to continue to be listed on the AIM Market of the
London Stock Exchange. In July 2020, the London Stock Exchange
suspended trading in the Company's AIM securities pursuant to AIM
Rule 40. The AIM rules provide that the Company will have an
additional six months from the suspension date to complete a
qualifying transaction. Initially, if the Company failed to
complete a qualifying transaction by 28 January 2021, the Company's
shares would be delisted from the AIM market. On 27 January 2021
and 29 March 2021 Motif provided the market with updates regarding
the proposed reverse takeover via RNS, in which the Company
confirmed that it would remain suspended from trading while the
proposed transaction was negotiated and advanced.
Financial Overview
The Company reported its former wholly owned subsidiary, Motif
BioSciences Inc., as discontinued operations in its 2019 financial
results. In January 2020, the Company determined that it no longer
has control of Motif BioSciences Inc. in accordance with IFRS 10
Consolidated Financial Statements. As a result, the Company will
not consolidate Motif BioSciences Inc. in future financial periods.
These changes have been made for all periods presented.
In February 2021, the Company divested its shareholdings of
Motif BioSciences Inc. ('Inc") to Orange Avenue Technologies, LLC
('Orange'), an entity controlled by John Palmer of Tamarack
Associates Inc. Mr. Palmer, through Tamarack Associates Inc., was
previously appointed in early 2020 as the sole Executive Officer of
Motif BioSciences Under the Stock Purchase Agreement with Orange,
the Company will receive 90% of the revenues received by Inc. from
iclaprim, above a $250,000 threshold.
The net loss from operations for the year ended 31 December 2021
was US $0.9 million (2019: loss of US $98.7 million).
The operations had total liabilities of US $0.1 million (2019:
US $0.4 million) and total assets of US $0.6 million (2019: US $0.8
million). The liabilities are primarily $0.1 million in non-cash
derivative warrant obligations and minimal vendor and related
obligations.
Going Concern
As of 31 December 2020, the Company had US $0.5 million in cash.
As an AIM Rule 15 cash shell, the Company's ability to continue as
a going concern is dependent on its ability to source an
appropriate reverse takeover or qualifying transaction. The
Company's shares were suspended from trading on AIM on 29 July 2020
pursuant to AIM Rule 40. On 27 January 2021 and 29 March 2021 Motif
provided the market with updates regarding the proposed reverse
takeover via RNS, in which the Company confirmed that it would
remain suspended from trading while the proposed transaction was
negotiated and advanced. If the Company is unable to complete
reverse takeover transaction for re-admission of trading on AIM the
listing of the Company's common shares will be cancelled.
These financial statements have been prepared under the
assumption that the Company will continue as a going concern.
However, as of the date these financial statements were approved,
the Company can provide no assurance that an RTO transaction will
be completed or additional capital will be available when required
and/or on acceptable terms. Due to the Company's recurring and
expected continuing operating losses, the Directors have concluded
there is a material uncertainty which may cast significant doubt on
the Company's ability to continue as a going concern. The financial
statements do not include any adjustments that might result from
this uncertainty.
Section 172 statement
The Company's Section 172 statement is set out in the Corporate
Governance Report on pages 7 to 10.
Jonathan E. Gold
Director
10 May 2021
Motif Bio plc
Statements of comprehensive loss
For the years ended 31 December 2020 and 2019
(Per share data in cents)
Year Year
ended ended
31 December 31 December
2020 2019
Note US $ (000's) US $ (000's)
---- ------------ ------------
Operating expenses
General and administrative
expenses........................................... 4 (891) (1,246)
Loss on impairment of receivable from subsidiary
...................... - (19,125)
------------ ------------
Operating loss
.....................................................................
........... (891) (20,371)
Interest
income...............................................................
............... 4 1 5
Net foreign exchange gains
(losses).............................................. (53) 49
Gain from revaluation of derivative
liabilities............................... 11 209 5,427
Loss on impairment of investment in
subsidiary........................... 2 - (83,771)
------------ ------------
Loss before income
taxes............................................................... (734) (98,661)
Income tax
expense..............................................................
.......... 6 - -
------------ ------------
Net loss from operations
............................................................... (734) (98,661)
------------ ------------
Comprehensive loss from operations
............................................ (734) (98,661)
============ ============
Net loss per share (in cents) -
basic.............................................. - (0.28)
Net loss per share (in cents) -
diluted........................................... - (0.28)
============ ============
Weighted average number of ordinary shares
.............................
Basic................................................................
............................... 597,628,009 350,993,002
Diluted..............................................................
.............................. 597,628,009 350,993,002
============ ============
Motif Bio plc
Statements of financial position
As at 31 December 2020 and 2019
(in thousands)
31 December 2020 31 December 2019
Note US $ (000's) US $ (000's)
---- ---------------- ----------------
ASSETS
Current assets
Cash and cash
equivalents........................................................
..... 9 457 663
Prepaid expenses and other
receivables....................................... 8 140 145
Total current
assets.............................................................
.......... 597 808
---------------- ----------------
Total assets
...................................................................
................. 597 808
================ ================
LIABILITIES
Trade payables and accrued
liabilities.......................................... 10 48 214
Derivative
liabilities........................................................
............... 11 88 227
---------------- ----------------
Total current
liabilities........................................................
........... 136 441
---------------- ----------------
Total liabilities
...................................................................
............ 136 441
================ ================
Net assets (liabilities)
...................................................................
. 461 367
================ ================
EQUITY
Share
capital............................................................
...................... 13 4,798 4,777
Share
premium............................................................
.................. 97,809 97,003
Accumulated
deficit............................................................
........... (102,147) (101,413)
---------------- ----------------
Total Equity
...................................................................
................ 461 367
================ ================
The financial statements were approved by the Board of Directors
and authorized for issue on
10 May 2021 . They were signed on its behalf by:
Director
Jonathan E. Gold
Motif Bio plc
Company statements of changes in equity
For the years ended 31 December 2020 and 2019
(in thousands)
Share Share Accumulated
capital premium deficit Total
Note US $ (000's) US $ (000's) US $ (000's) US $ (000's)
---- ------------ ------------ ------------ ------------
Balance at 31 December 2018 4,032 93,456 (2,331) 95,160
============ ============ ============ ============
Loss for the year - - (98,661) (98,661)
------------ ------------ ------------ ------------
Total comprehensive loss for the year - (98,661) (98,661)
Issue of share capital 13 738 3,569 - 4,307
Cost of issuance 13 - (317) - (317)
Exercise of share options and warrants 11 7 295 - 302
Share-based payments 12 - - (424) (424)
------------ ------------ ------------ ------------
Balance at 31 December 2019 4,777 97,003 (101,413) 367
Loss for the year - - (734) (734)
------------ ------------ ------------ ------------
Total comprehensive loss for the year - (734) (734)
Issue of share capital 13 20 789 - 809
Cost of issuance 13 - (40) - (40)
Exercise of share options and warrants 11 1 58 - 59
Balance at 31 December 2020 4,798 97,809 (102,147) 461
============ ============ ============ ============
Motif Bio plc
Statements of cash flows
For the years ended 31 December 2020 and 2019
(in thousands)
Year ended Year ended
31 December 31 December
2020 2019
Note US $ (000's) US $ (000's)
---- -------------------- ----------------------------
Operating activities
Operating loss for the
year.............................................
................. (891) (20,371)
Adjustments to reconcile net loss to net cash
used in activities:
Share-based
payments.........................................
............................ 12 - (32)
Loss on impairment of receivable from
subsidiary......................... 2 - 19,125
Interest
received.........................................
...................................... 1 4
Changes in operating assets and liabilities:
Prepaid expenses and other
receivables...................................
.. 5 9
Trade payables and accrued
liabilities...................................
..... (167) 18
-------------------- ----------------------------
Net cash used in operating
activities.......................................
........ (1,052) (1,247)
Investing activities
.................................................
..........................
Capital contributions to subsidiary
.................................................
.. - (3,821)
Due from Motif Bio Inc.
.................................................
................... - 941
-------------------- ----------------------------
Net cash used in investing activities
................................................ - (2,880)
Financing activities
.................................................
.........................
Proceeds from issue of share
capital..........................................
..... 13 809 4,307
Costs of issuance of share
capital..........................................
.......... 13 (40) (317)
Proceeds from exercise of warrants and
options............................ 11 59 244
-------------------- ----------------------------
Net cash provided by financing
activities.......................................
. 828 4,234
-------------------- ----------------------------
Net change in
cash.............................................
.............................. (224) 107
Cash, beginning of the
year.............................................
................. 663 560
Effect of foreign exchange rate
changes......................................... 18 (4)
-------------------- ----------------------------
Cash, end of the year
.................................................
...................... 457 663
==================== ============================
1. General information
Motif Bio plc (the "Company" or "Motif") is domiciled in England
and Wales having originally been incorporated on November 20, 2014
as Motif Bio Limited, a private company, with company registration
number 09320890. On 1 April 2015, the Company was re-registered as
a public company limited by shares and changed its name to Motif
Bio plc. The Company's registered office is at: 201 Temple
Chambers, 3-7 Temple Avenue, London EC4Y 0DT, U.K.
The Company's ordinary shares are listed on the AIM Market
("AIM") of the London Stock Exchange plc. On 28 January 2020, the
Company announced that it was reclassified as an AIM Rule 15 Cash
Shell and, as such, was required to make an acquisition or
acquisitions which constitute(s) a reverse takeover under AIM Rule
14 within six months to continue to have its shares traded on the
AIM market. On 29 July 2020, the London Stock Exchange suspended
the trading in the Company's AIM listed ordinary shares pursuant to
AIM Rule 40. The AIM rules initially provided that the Company had
an additional six months from the suspension date, or 28 January
2021, to complete a qualifying transaction. On 27 January 2021 and
29 March 2021 Motif provided the market with updates regarding the
proposed Reverse Takeover via RNS, in which the Company confirmed
that it would remain suspended from trading while the proposed
transaction was negotiated and advanced. If the Company is unable
to complete reverse takeover transaction for re-admission of
trading on AIM the listing of the Company's common shares will be
cancelled.
From November 2016 until December 2019, the Company had American
Depository Shares ("ADS's") and ADS warrants that were traded on
the NASDAQ Capital Market. Effective December 2019 following a
voluntary delisting, the Company's ADS's and ADS warrants are no
longer traded on the NASDAQ Capital Market.
The financial statements presented represent the accounts of the
Company. After shareholder approval of a corporate restructuring in
November 2019, the Company's former wholly owned subsidiary, Motif
BioSciences Inc., an entity incorporated in U.S. State of Delaware,
was reported as discontinued operations as at 31 December 2019.
During the first quarter of 2020, the Company appointed John Palmer
of Tamarack Associates, Inc. as the sole Executive Officer of Motif
Biosciences Inc. As a result, the Company determined that it no
longer had control over Motif BioSciences Inc. will no longer
consolidate the financial results of the entity for financial
reporting periods commencing in 2020. In February 2021, the Company
divested it's the ownership of Motif BioSciences Inc., to Orange
Avenue Technologies, LLC, an entity controlled by John Palmer of
Tamarack Associates Inc.
The financial statements were approved by the Board of Directors
on 10 May 2021.
Going concern
The Company had US $0.5 million and US $0.6 million in cash as
of 31 December 2020 and 2019, respectively. The Company's Directors
are focused on completing a reverse takeover over transaction for
the Company. There is no assurance that the effort will be
successful to complete a reverse takeover or qualifying transaction
to avoid being delisted from the AIM market. Based on this
condition, including recurring and expected continuing operating
losses, the Directors have concluded that there is material
uncertainty that may cast a significant doubt about the Company's
ability to continue as a going concern and, therefore, that it may
be unable to realize its assets and discharge its liabilities in
the normal course of business.
The financial statements have been prepared on the basis that
the Company is a going concern, which contemplates the continuity
of normal business activity, realization of assets and settlement
of liabilities in the normal course of business. Should the entity
not be able to continue as a going concern, it may be required to
realize its assets and discharge its liabilities other than in the
ordinary course of business, and at amounts that differ from those
stated in the financial statements. The financial statements do not
include any adjustments relating to the recoverability and
classification of recorded asset amounts or liabilities that might
be necessary should the Company not continue as a going
concern.
2. Significant accounting policies
a. Basis of preparation
The accounting policies set out below have been applied
consistently to all periods presented in this financial
information.
The financial statements have been prepared in accordance with
International Financial Reporting Standards ("IFRS") as adopted by
the European Union and with the Companies Act 2006 applicable to
companies reporting under IFRS. This basis of preparation describes
how the financial statements have been prepared in accordance with
IFRS. The financial statements have been prepared under the
historical cost convention as modified for financial instruments
(including derivative instruments) at fair value through the
statement of comprehensive loss. A summary of the significant
accounting policies is set out below.
2. Significant accounting policies, continued
The preparation of financial statements in conformity with IFRS
requires the use of estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the
financial information and the reported amounts of expenses during
the period. Although these estimates are based on management's best
knowledge of the amount, event or actions, actual results
ultimately may differ from those estimates.
The recently adopted new standards that are potentially relevant
to the Company are discussed below.
IFRS 3- Business Combination - effective date 1 January 2020 -
The amendments confirm that a business must include inputs and a
process and clarified that the process must be substantive, and the
inputs and process must together significantly contribute to
creating outputs. The amendment also narrowed the definition of a
business and included tests that make it easier to conclude whether
a business or group of assets was acquired. Any future impact of
adopting the amendment would be primarily dependent on future
acquisition transactions, if any.
b. Segment reporting
The chief operating decision-maker is considered to be the Board
of Directors of Motif Bio plc. The chief operating decision-maker
allocates resources and assesses performance of the business and
other activities at the operating segment level. In addition, they
review the IFRS financial statements.
The chief operating decision-maker had determined that the
Company currently has one segment-to support its strategy as an AIM
15 cash shell entity focused on sourcing a reverse-take-over
candidate. In 2019 prior to the corporate restructuring approved by
shareholders in November 2019, the Company had one segment to
support the development and commercialization of pharmaceutical
formulations.
c. Foreign currency translation
(a) Functional and Presentation Currency
Items included in the financial statements are measured using
the currency of the primary economic environment in which the
entity operates ("the functional currency"). The financial
statements are presented in United States Dollars (US $), which is
Motif Bio plc's functional and presentation currency.
(b) Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates at the dates of the transactions.
Foreign exchange gains and losses resulting from the settlement of
such transactions and from the translation of monetary assets and
liabilities denominated in foreign currencies at year-end exchange
rates are generally recognized in the statement of comprehensive
loss.
Foreign exchange gains and losses that relate to borrowings are
presented in the statement of profit or loss, within finance costs.
All other foreign exchange gains and losses are presented in the
statement of comprehensive loss.
Non-monetary items that are measured at fair value in a foreign
currency are translated using the exchange rates at the date when
the fair value was determined. Translation differences on assets
and liabilities carried at fair value are reported as part of the
fair value gain or loss. For example, translation differences on
non-monetary assets and liabilities such as equities held at fair
value are recognized in profit or loss as part of the fair value
gain or loss and translation differences on non-monetary assets
such as equities classified as available-for-sale financial assets
are recognized in other comprehensive income.
d. Financial assets and liabilities
Financial assets and financial liabilities are included in the
Company's statement of financial position when it becomes a party
to the contractual provisions of the instrument. Financial assets
are derecognized when the rights to receive cash flows from the
investments have expired or have been transferred and the Company
has transferred substantially all risks and rewards of
ownership.
e. Fair value disclosures
The Company's cash, prepaid expenses and other current assets
and trade and other payables are stated at their respective
historical carrying amounts, which approximates fair value due to
their short-term nature. The Company's derivative liability is
measured at fair value using Level 1 and 2 inputs (Note 11).
There were no non-recurring fair value measurements for the
years ended 31 December 2020 or 2019.
When measuring the fair value of an asset or a liability, the
Company uses observable market data as far as possible. Fair values
are categorized into different levels in a fair value hierarchy
based on the inputs used in the valuation techniques as
follows:
-- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
-- Level 2: inputs other than quoted prices included in Level 1
that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices).
-- Level 3: inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
Cash and cash equivalents
Cash and cash equivalents include bank balances, demand
deposits, and other short-term, highly liquid investments (with
less than three months to maturity) that are readily convertible
into a known amount of cash and are subject to an insignificant
risk of fluctuations in value.
Financial liabilities and equity
The Company classifies an instrument, or its component parts, on
initial recognition as a financial liability or an equity
instrument in accordance with the substance of the contractual
arrangement and the definitions of a financial liability and an
equity instrument.
An instrument is classified as a financial liability when it is
either (i) a contractual obligation to deliver cash or another
financial asset to another entity; or (ii) a contract that will or
may be settled in the Company's own equity instruments and is a
non-derivative for which the Company is, or may be, obliged to
deliver a variable number of the Company's own equity instruments
or a derivative that will, or may be, settled other than by the
exchange of a fixed amount of cash or another financial asset for a
fixed number of the Company's own equity instruments. Incremental
costs directly attributable to the issue of new ordinary shares or
options are shown in equity as a deduction, net of tax, from the
proceeds.
An equity instrument is defined as any contract that evidences a
residual interest in the assets of an entity after deducting all
its liabilities. An instrument is an equity instrument only if the
issuer has an unconditional right to avoid settlement in cash or
another financial asset.
Trade payables and accrued liabilities
Trade payables and accrued liabilities are obligations to pay
for goods or services that have been acquired in the ordinary
course of business from or rendered by suppliers. All are
classified as current liabilities if payment is due within one year
or less (or in the normal operating cycle of the business if
longer). If not, they are presented as non-current liabilities.
Trade payables and accrued liabilities are initially measured at
fair value, and, where applicable, are subsequently measured at
amortized cost, using the effective interest rate method.
Equity instruments
Equity instruments issued by the Company are recorded at the
proceeds received. Direct issuance costs are processed as a
deduction on equity.
Derivative financial instruments
The Company does not have a policy of engaging in speculative
transactions, nor does it issue or hold financial instruments for
trading purposes.
The Company has entered into financing arrangements that include
the issuance of warrants. These warrants may be considered
derivative financial instruments based on the terms of the
agreements.
Derivatives are initially recognized at fair value on the date a
derivative contract is entered into and are subsequently
re-measured at their fair value. The resulting gain or loss is
recognized in the consolidated statement of comprehensive loss, as
the Company does not apply hedge accounting.
f. Impairment of financial assets
The Company assessed at the end of each reporting period whether
there was objective evidence that a financial asset or group of
financial assets is impaired. A financial asset or a group of
financial assets is impaired and impairment losses are incurred
only if there is objective evidence of impairment as a result of
one or more events that occurred after the initial recognition of
the asset (a "loss event") and that loss event (or events) has an
impact on the estimated future cash flows of the financial asset or
group of financial assets that can be reliably estimated.
Prior to being classified as discontinued operations, the
Company's former wholly owned subsidiary Motif BioSciences, Inc.
was in proprietary drug discovery research and development. In
early 2020, the Company determined that it no longer has control of
Motif BioSciences Inc. in accordance with IFRS 10 Consolidated
Financial Statements and, as a result, the Company will not
consolidate Motif BioSciences Inc. (Note 1).
The Company evaluated the investment and intercompany receivable
balances for impairment as of the 31 December 2019. Based on the
operations of Motif BioSciences Inc. being discontinued, the
Company determined that the probability of recovering both balances
was unlikely. As a result, the Company recorded an impairment
charge equal to the full amount of the respective balances as of 31
December 2019.
g. Share-based payment transactions
The fair value of options and warrants granted to employees,
Directors, and consultants is recognized as an expense, with a
corresponding increase in equity, over the period in which the
option and warrant holders become unconditionally entitled to the
options and warrants unless incremental and directly attributable
to an equity transaction in which case it is deducted from equity.
The fair value of the options and warrants granted is measured
using an option valuation model, taking into account the terms and
conditions upon which the options were granted.
h . Financial income
Financial income comprises interest receivable on funds
invested.
Interest income is recognized in the statement of comprehensive
loss as they accrue, using the effective interest method.
i . Taxation
Tax on the profit or loss for the year comprises current and
deferred tax. Tax is recognized in the consolidated statement of
comprehensive loss except to the extent that it relates to items
recognized directly in equity, in which case it is recognized in
equity.
Current tax is the expected tax payable on the taxable income
for the period, using tax rates enacted or substantively enacted at
the reporting date and any adjustment to tax payable in respect of
previous years.
Deferred tax is provided on temporary differences between the
carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. The following
temporary differences are not provided for: the initial recognition
of goodwill; the initial recognition of assets or liabilities that
affect neither accounting nor taxable profit other than in a
business combination; and differences relating to investments in
subsidiaries to the extent that they will probably not reverse in
the foreseeable future. The amount of deferred tax provided is
based on the expected manner of realization or settlement of the
carrying amount of assets and liabilities, using tax rates enacted
or substantively enacted at the reporting date.
A deferred tax asset is recognized only to the extent that it is
probable that future taxable profits will be available against
which the temporary difference can be utilized.
j. Earnings per share
The Company presents basic and diluted earnings per share (EPS)
data for its shares. Basic EPS is calculated by dividing the profit
or loss attributable to shares of the Company by the weighted
average number of shares outstanding during the period. Diluted EPS
is determined by adjusting the profit or loss attributable to
shareholders and the weighted average number of shares outstanding
for the effects of all dilutive potential shares, which comprise
share options and warrants granted to employees and non-employees.
Refer to Note 9 for calculation of EPS for all periods
presented.
k. Equity
The Company classifies an instrument, or its component parts, on
initial recognition as a financial liability or an equity
instrument in accordance with the substance of the contractual
arrangement and the definitions of a financial liability and an
equity instrument.
An instrument is classified as a financial liability when it is
either (i) a contractual obligation to deliver cash or another
financial asset to another entity; or (ii) a contract that will, or
may be, settled in the Company's own equity instruments and is a
non-derivative for which the Company is, or may be, obliged to
deliver a variable number of the Company's own equity instruments
or a derivative that will or may be settled other than by the
exchange of a fixed amount of cash or another financial asset for a
fixed number of the Company's own equity instruments.
Incremental costs directly attributable to the issue of new
ordinary shares or options are shown in equity as a deduction, net
of tax, from the proceeds.
An equity instrument is defined as any contract that evidences a
residual interest in the assets of an entity after deducting all of
its liabilities. An instrument is an equity instrument only if the
issuer has an unconditional right to avoid settlement in cash or
another financial asset.
Ordinary Shares
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of new shares or options are
shown in equity as a deduction from the proceeds.
l. Critical accounting estimates and judgments
In preparing the financial information, the Directors make
judgments on how to apply the Group's accounting policies and make
estimates about the future. The critical judgments that have been
made in arriving at the amounts recognized in the financial
information and the key sources of estimation uncertainty that have
a significant risk of causing a material adjustment to the carrying
value of assets and liabilities in the next financial year, are
discussed below:
Going concern
Refer to going concern assessment described in Note 1.
Share based payments and fair value of warrants (Estimate)
The Directors have to make judgments when deciding on the
variables to apply in arriving at an appropriate valuation of
warrants, including appropriate factors for volatility, risk-free
interest rate, and applicable future performance conditions and
exercise patterns.
3. Financial risk management
The Company's exposure to financial risks and how these risks
could affect the Company's future financial performance is
primarily limited to credit risk from a counterparty, liquidity
risk and market risk.
All deposits are held with banks that have a minimum S&P
rating of A or A-3 for short term deposits. At 31 December 2020, no
current assets were impaired.
Liquidity risk is the risk that the Company will not be able to
meet its financial obligations as they become due. See discussion
in Note 1 as it relates to the Company's ability to continue as a
going concern.
The Company has financed its operations to date using cash
raised through the issuance equity. The Directors acknowledge that
uncertainty remains over the ability of the Company to have the
resources to support the Company's foreseeable operating needs as
an AIM Rule 15 cash shell and complete a qualifying transaction. An
inability to complete a qualifying transaction will result in the
Company being delisted from the AIM Market of the London Stock
Exchange.
The Company undertakes certain transactions denominated in
foreign currencies. Hence, exposures to exchange rate fluctuations
arise. Exchange rate exposures are managed by minimizing the
balance of foreign currencies to cover expected cash flows during
periods where there is strengthening in the value of the foreign
currency. The Company holds part of its cash resources in US
dollars and British pounds sterling. The valuation of the cash
fluctuates along with the US dollar/sterling exchange rate. No
hedging of this risk is undertaken.
The carrying amounts of foreign currency denominated monetary
net assets at the reporting date are as follows:
31 December 2020 31 December 2019
(in thousands) US $ US $
---------------- ----------------
Sterling - Cash.................................................... 210 655
The exchange rate between British Pound and the United States
Dollar at 31 December 2020 and 2019 was 1.37 and 1.33,
respectively. A change in foreign currency exchange rates may have
a significant impact on the profit or losses of the Group.
4. Other income and expense items
This note provides a breakdown of the items included in other
income, finance income and expenses by nature for the years ended
31 December 2020 and 2019.
a. Breakdown of expenses by nature
Year ended Year ended
31 Dec 2020 31 Dec 2019
(in thousands) US $ (000's) US $ (000's)
--------------------------------------------------------------------------------- ------------ ------------
General and administrative expenses
Director fees, employee/consultant compensation, including share-based
payments................................................................ 563 258
Legal, insurance and professional fees........................................ 214 586
Investor and public relations and related fees .......................... 59 32
Other
expenses.........................................................................
....... 55 370
------------ ------------
891 1,246
------------ ------------
The Company had one male Executive Director and one male
employee at 31 December 2020.
b. Auditors' Remuneration
2020 2019
(in thousands) US $ (000's) US $ (000's)
--------------------------------------------------------------------------------- ------------ ------------
Fees paid/payable to the company's auditors and its associates for the audit of
the Company's
financial statements............... 27 47
27 47
------------ ------------
c. Finance income and cost
Year ended Year ended
31 Dec 2020 31 Dec 2020
(in thousands) US $ (000's) US $ (000's)
------------ ------------
Finance income
Interest from financial
assets......................................................... 1 5
------------ ------------
1 5
------------ ------------
Finance costs
Interest
expense..........................................................................
.... - -
------------ ------------
- -
------------ ------------
Net finance
income......................................................................... 1 5
------------ ------------
5. Directors' remuneration
As part of the corporate restructuring approved by the Company's
shareholders on 14 November 2019 (Note 1) directors Dr. Craig
Albanese, Charlotta Ginman, Zaki Hosny, Dr. Mary Lake Polan, and
Andrew Powell resigned from the board and all directors forfeited
all previously outstanding vested and non-vested option and waived
accrued cash fees owed at that time.
The table below summarizes the director's cash remuneration for
the periods presented.
Salaries 2020 2019
and fees Bonuses Total Total
US $ (000's) US $ (000's) US $ (000's) US $ (000's)
------------ ------------ ------------ ------------
Executive
Jonathan Gold(1)
........................................ 300,000 - 300,000 618,388
Non-executive....................................
.......
Graham Lumsden(1)
.................................. 115,000 - 115,000 464,063
Richard Morgan(3)
..................................... - - - 56,750
Charlotta Ginman(3)
.................................. - - - 43,472
Zaki Hosny(3)
.............................................. - - - 32,625
Mary Lake Polan(3)
.................................... - - - 30,000
Chris Wardhaugh
.................................... 10,250 - 10,250 48,625
Bruce
Williams......................................... 30,000 - 30,000 48,625
Craig T. Albanese(3)
................................... - - - 35,000
------------ ------------ ------------ ------------
455,250 - 455,250 1,328,923
------------ ------------ ------------ ------------
(1) The compensation for Dr. Lumsden and Mr. Gold excludes US
$8,400 and US $8,400 in employer provided 401k pension contribution
during 2019. There was no contribution in 2020.
(2) Effective 18 March 2019, Richard Morgan resigned from the
Board of Directors and his role as Chairman. Bruce Williams was
appointed interim Chairman of the Board at that time.
(3) Members' resignation effective 15 November 2019 (Note
1).
The compensation for Board members continuing in 2020 is
outlined below by individual.
Bruce Williams is to receive a monthly salary of US $2,500 and
is entitled to receive an additional monthly salary of US $2,500
that is deferred and payable only upon the occurrence of a reverse
takeover transaction or similar transaction. Mr. Williams has
voluntarily agreed to waive all deferred cash compensation related
to the occurrence of a reverse takeover.
Graham Lumsden, in his capacity as Non-Executive Director, is to
receive a monthly salary of US $1,250 and is entitled to receive an
additional monthly salary of US $2,500 that is deferred and payable
only upon the occurrence of a reverse takeover transaction or
similar transaction. Further, as a result of his executive service
earlier to May 2020, Dr. Lumsden is entitled to an additional US
$100,000 that is deferred and payable only upon the occurrence of a
reverse takeover transaction or similar transaction. Dr. Lumsden
has voluntarily agreed to waive all deferred cash compensation
related to the occurrence of a reverse takeover.
Chris Wardhaugh, appointed as a Non-Executive Director on 4 May
2020, is to receive a monthly salary of GBP1,000 (GBP) and is
entitled to receive an additional monthly salary of GBP2,000 (GBP)
that is deferred and payable only upon the occurrence of a reverse
takeover transaction or similar transaction. Mr. Wardhaugh has
voluntarily agreed to waive all deferred cash compensation related
to the occurrence of a reverse takeover.
Jonathan Gold, in his capacity as Chief Financial Officer,
President and Chief Business Officer and Executive Director is to
receive a monthly salary of US $25,000 and is entitled to receive
an additional monthly salary of US $25,000 that is deferred and
payable only upon the occurrence of a reverse takeover transaction
or similar transaction. Mr. Gold has voluntarily agreed to waive
all deferred cash compensation related to the occurrence of a
reverse takeover.
6. Income tax expense
The Company did not recognize U.K. corporate tax expense in the
statement of comprehensive loss during the years ended 31 December
2020 and 2019. The main rate of U.K. corporation tax was reduced
from 21% to 19% from 1 April 2015. The Company has an unrecognized
net deferred tax asset of US $18 million related to net cumulative
operating losses of US $107 million, which includes the impairment
charges relating to the Company's operating receivable from and
investment in its previously discontinued subsidiary Motif
BioSciences, Inc. Net operating loss are subject to review and
possible adjustment by taxing authorities and may become subject to
an annual limitation, which could limit the amount of tax
attributes that can be utilized annually to offset future taxable
income or tax liabilities. There is no assurance as to the extent
and timing of the Company's ability to realize the possible tax
benefits derived from cumulative net operating losses.
7. Loss per share
Basic loss per share is calculated by dividing the loss
attributable to equity holders of the Company by the weighted
average number of shares in issue during the year. Diluted EPS is
computed by dividing net income (loss) by the weighted average of
all potentially diluted share of common stock that were outstanding
during the periods presented.
The treasury stock method is used in the calculation of diluted
EPS for potentially dilutive liability classified options and
warrants, which assumes that any proceeds received from the
exercise of in-the-money options and warrants, would be used to
purchase common shares at the average market prices for the
period.
The following table shows the derivation of loss per share for
continuing operations.
Year ended Year ended
31 Dec 2020 21 Dec 2019
(Per share data in cents) US $ (000's) US $ (000's)
------------ ------------
Basic
Net
loss...............................................................................
............................... (734) (98,660)
Basic weighted average shares in
issue....................................................... 597,628,009 350,993,002
------------ ------------
Basic loss per share (in
cents)........................................................................ - (0.28)
------------ ------------
Diluted
Net
gain.................................................................................
............................. (734) (98,660)
Effect of dilutive securities: liability-classified
warrants........................... - -
----------- -----------
Diluted net
gain/(loss)..........................................................................
........... (734) (98,660)
----------- -----------
Weighted average shares in issue -
basic.................................................... 597,628,009 350,993,002
Incremental dilutive shares from liability-classified warrants
treasury stock
method)..............................................................................
..... - -
----------- -----------
Weighted average shares in issue - diluted
............................................... 597,628,009 350,993,002
----------- -----------
Diluted net loss per share (in
cents)............................................................. - (0.28)
----------- -----------
The following potentially dilutive securities outstanding at 31
December 2020 and 2019 have been excluded from the computation of
diluted weighted average shares outstanding, as they would be
antidilutive.
2020 2019
----------- ----------
Warrants............................................................................
.................. 146,614,724 54,154,709
Share
options.............................................................................
......... 754,425 3,778,563
----------- ----------
147,369,149 57,933,272
----------- ----------
8. Prepaid expenses and other receivables
Year end Year end
31 Dec 2020 31 Dec 2019
Amounts due within one year US $ (000's) US $ (000's)
------------- -------------
Prepayments and other receivables........................................ 140 145
-------------
140 145
------------- -------------
The maximum exposure to credit risk at the end of each reporting
period is the fair value of each class of receivables set out
above. The Company held no collateral as security. The Directors
estimate that the carrying value of receivables approximated their
fair value.
9. Cash and cash equivalents
Year end Year end
31 Dec 2020 31 Dec 2019
US $ (000's) US $ (000's)
------------- -------------
Cash and cash equivalents at bank........................................... 457 663
-------------
457 663
------------- -------------
10. Financial liabilities
Year end Year end
31 Dec 2020 31 Dec 2019
Amounts due within one year US $ (000's) US $ (000's)
------------- -------------
Trade
payables.........................................................................
.... 26 119
Accrued
expenses....................................................................... 22 95
Derivative liabilities (Note
15)................................................... 88 227
------------- -------------
136 441
------------- -------------
The Directors estimate that the carrying value of trade and
accrued expenses approximated their fair value. Trade payables are
generally payable on normal trade terms, usually 30 days.
11. Warrants
Warrant activity
The Company has issued warrants for services performed and in
conjunction with various equity financings. The Company's warrants
represent ordinary shares or ADS and have either a Pounds Sterling
or US Dollar exercise price. The ADS warrants are exercisable to
purchase ADS's, which each represent 20 ordinary shares. Depending
on the terms of the warrant agreements, the ordinary share or ADS
warrants are classified as either equity or a liability. Liability
classified warrants are remeasured each reporting period, with
changes in fair value recorded in the statements of comprehensive
loss. The following is a summary of the Company's warrant activity
during the year ended 31 December 2020:
Weighted Average
Number of Warrants Exercise Price
--------------------------- ------------------------
Ordinary shares ADS Ordinary shares ADS
--------------- ---------- ----------------- -----
Outstanding as of 1 January 2019 155,564,670 1,212,902 GBP 0.273 $8.02
Granted - - - -
Cancelled (1,807,089) - GBP 0.380 -
Exercised (7,142,857) - GBP 0.007 -
--------------- ---------- --------- ----
Outstanding as of 31 December 2020 146,614,724 1,212,902 GBP 0.273 $8.02
--------------- ---------- --------- ----
The warrants outstanding and exercisable as of 31 December 2020
were as follows:
Type of Warrant Outstanding Number Outstanding and Exercisable Exercise Price Expiration Date
---------------------------- ---------------------------------- ---------------- ----------------
Ordinary shares (2) 10,317,252 GBP GBP 0.322 23 November 2021
ADS (2)(3) 1,202,902 US $ 8.03 23 November 2021
Ordinary shares (1) 8,960,431 GBP GBP 0.20 April 2, 2025
ADS (2)(3) 10,000 US $ 7.26 July 31, 2022
Ordinary shares (2)(4) 121,337,047 GBP GBP 0.004 27 January 2025
Ordinary shares (2)(4) 6,000,000 GBP GBP 0.002 27 January 2025
(1) Warrants are equity classified.
(2) Warrants totalling 137,654,293 of ordinary shares and
1,212,902 of ADS are liability classified.
(3) Each ADS represents 20 ordinary shares.
(4) Warrants totalling 134,479,904 of ordinary shares were
issued on 27 January 2017. The accounting treatment thereof was
recorded as of 31 December 2019 as an adjusting subsequent event. A
total of 7,142,857 of these warrants were exercised prior to 31
December 2020.
Liability classified warrants
ADS warrants
On 23 November 2016, the Company closed an initial U.S. offering
of 2,438,491 ADS and 1,219,246 ADS warrants at a price of US $6.98
per ADS/Warrant combination. Each ADS represented 20 ordinary
shares. The warrants have an exercise price of US $8.03 per ADS and
expire on 23 November 2021. As the Company failed to maintain the
effectiveness of its Registration Statement, the warrant is only
exercisable on a cashless basis. This results in variability in the
number of shares issued and therefore, the warrants were designated
as a financial liability carried at fair value through profit and
loss. On issuance of the ADS warrants, the Company recorded a
derivative liability of US $3.8 million using the Black-Scholes
model.
On 1 August 2017, the Company issued to a third party a warrant
to purchase up to 60,000 ADSs at an exercise price of US $7.26 per
ADS. A total of 10,000 ADSs were vested and outstanding as of 30
June 2020. The remaining 50,000 ADSs were forfeited. On issuance of
the ADS warrants, the Company recorded a derivative liability of
$0.1 million using the Black-Scholes model.
The Company develops its own assumptions for use in the
Black-Scholes option pricing model that do not have observable
inputs or available market data to support the fair value. This
method of valuation involves using inputs such as the fair value of
the Company's common stock, stock price volatility of comparable
companies, the contractual term of the warrants, risk free interest
rates and dividend yields. November 26, 2019, the Company notified
NASDAQ Capital Market of its intention to delist the ADS shares and
ADS warrants from trading. The ADS shares and ADS warrants were
voluntarily delisted from trading in December 2019.
At 31 December 2020 and 2019, the liability classified ADS
warrants had a fair value of US $ nil value using the following
weighted-average assumptions in the Black-Scholes model:
31 December 31 December
2020 2019
----------- -----------
Share price (US $)(1)
.......................................................................................
.... 0.03 0.10
Exercise price (US
$).....................................................................................
.... 8.02 8.08
Expected
volatility.............................................................................
................ 139 % 92 %
Number of periods to
exercise....................................................................... 0.90 1.90
Risk-free
rate...................................................................................
................... 0.16 % 1.58 %
Expected
dividends..............................................................................
............. - -
(1) Effective December 2019 following a voluntary delisting, the
Company's ADS shares are no longer traded on the NASDAQ Capital
Market. The share price utilized represent the Company's ordinary
share price to reflect the conversion to ADS equivalents and
conversion to the U.S. dollar.
Ordinary warrants
On 23 November 2016, the Company placed 22,863,428 ordinary
shares together with 11,431,714 warrants over ordinary shares at a
price of GBP0.28 per share/warrant combination. The warrants have
an exercise price of GBP0.322 per warrant and expire on 23 November
2021. This results in variability in the number of shares issued
and therefore, the warrants were designated as a financial
liability carried at fair value through profit and loss. On
issuance of the warrants, the Company recorded a derivative
liability of US $1.8 million using the Black-Scholes model.
On 27 January 2020, the Company granted to Hercules Capital Inc.
warrants over an aggregate of 121,337,041 ordinary shares. These
warrants will expire on 27 January 2025 and have an exercise price
of 0.42 pence per share. The Company also granted warrants over
6,000,000 ordinary shares to certain former board members at an
exercise price of 0.24 pence per share that will expire on 27
January 2025. The issuance of these warrants was presented as an
adjusting subsequent event at 31 December 2019 (Note 1).
At 31 December 2020 and 2019, the liability classified ordinary
warrants had a fair value of US $0.1 million and US $0.2 million,
respectively, using the following weighted-average assumption in
the Black-Scholes model:
31 December 31 December
2020 2019
----------- -----------
Share price
(GBP)..................................................................................
............ 0.001 0.002
Weighted exercise price
(GBP)....................................................................... 0.028 0.028
Expected
volatility.............................................................................
................ 99 % 85 %
Number of periods to
exercise....................................................................... 3.84 4.77
Risk-free
rate...................................................................................
................... 0.15 % 1.68 %
Expected
dividends..............................................................................
............. - -
The following is a summary of the liability classified warrant
activity, including both ADS and Ordinary warrants, during the
years ended 31 December 2020 and 2019:
(in thousands) Fair value
Liability classified warrants US $
----------------------------------------------------------------------------------------------------- ----------
Balance at 1 January 2019............................................................................. 5,789
Issued during the
year.................................................................................... -
Exercised during the
year.............................................................................. (55)
Impact of foreign exchange........................................................................... (80)
Gain from revaluation of derivative liabilities............................................ (5,427)
----------
Balance at 31 December 2019..................................................................... 227
Issued during the
year.................................................................................... -
Exercised during the
year.............................................................................. -
Impact of foreign exchange........................................................................... 70
Gain from revaluation of derivative liabilities............................................ (209)
----------
Balance at 31 December 2020 ..................................................................... 88
----------
12. Share based payments
Motif Bio plc adopted a Share Option Plan (the "New Plan") on 1
April 2015. The exercise price for each option will be established
at the discretion of the Board provided that the exercise price for
each option shall not be less than the nominal value of the
relevant shares if the options are to be satisfied by a new issue
of shares by the Company and provided that the exercise price per
share for an option shall not be less than the fair market value of
a share on the effective date of grant of the option. Options will
be exercisable at such times or upon such events and subject to
such terms, conditions and restrictions as determined by the Board
on grant date. However, no option shall be exercisable after the
expiration of ten years after the effective date of grant of the
option.
Weighted
average
exercise
Number of price
share
options US $
------------ ------------
Outstanding at 31 December 2018
................................................................................ 18,387,038 0.34
Granted during the
year...............................................................................
.................... 100,000 0.11
Forfeited during the
year...............................................................................
.................. (14,549,544) 0.34
Cancelled during the
year...............................................................................
.................. (158,931) 0.56
Exercised during the year - -
...................................................................................
.............
------------
Outstanding at 31 December 2019
................................................................................ 3,778,563 0.50
Granted during the
year...............................................................................
.................... - -
Forfeited during the
year...............................................................................
.................. (2,500,218) 0.35
Exercised during the year -
...................................................................................
............. -
Expired during the
year...............................................................................
..................... (523,920) 0.69
------------
Outstanding at 31 December 2020
................................................................................ 754,425 0.14
------------
Exercisable at 31 December 2020
.................................................................................. 754,425 0.14
------------
All options at 31 December 2020 had a per share exercise price
of US $0.14 and a remaining contractual term of 2 years.
The total expense recognized for the years arising from
stock-based payments are as follows:
Year ended Year ended
31 Dec 2020 31 Dec 2019
(in thousands) US $ (000's) US $ (000's)
------------ ------------
General and administrative
expense.......................................................... - (309)
Research and development
expense......................................................... - (115)
------------ ------------
Total share-based payment (gain)
expense............................................... - (424)
------------ ------------
For the year ended 31 December 2019, the Company recorded a net
gain of $0.4 million due to the forfeitures that occurred during
the period. No gain was recorded for the forfeitures that occurred
during the year ended 31 December 2020.
13. Share capital
On 14 November 2019, each of the Company's ordinary shares of 1
pence par value were divided into one New Ordinary Share of 0.01
pence par value and one deferred share of 0.99 pence stated value.
The deferred shares have no rights and the Company did not issue
any share certificates or credit CREST accounts in respect of them.
The deferred shares are not admitted to trading on AIM and have no
rights to participate in the profits of the Company. In the event
of a wind-down or dissolution of the Company, the deferred shares
shall be entitled to participate pari-passu in the dissolution of
the Company's assets that are in excess of GBP GBP 1 trillion.
The number of New Ordinary Shares in issue and held by each
Shareholder at the time of the Share Capital Reorganisation, was
equal to the number of existing Ordinary Shares in issue
immediately prior to the Share Capital Reorganisation. Only the
nominal value changed with respect to the New Ordinary Share. The
New Ordinary Shares will continue to carry the same rights as those
attached in the previously existing Ordinary Shares, save for the
reduction in nominal value.
The net effect is that the par value for the Company's ordinary
shares changed to 0.01 pence as a result of this sub-division.
Allotted, called up and fully paid: Number US $ (000's)
--------------------------------------------------------------------------------------------------------------- ----------- ------------
(in thousands, except share data)
In issue at 31 December
2018.......................................................................................................... 296,660,243 3,589
Issued:
Ordinary shares of 1p
each....................................................................................................
. 830,780 9
Ordinary shares of 1p
each....................................................................................................
. 45,000,000 433
Ordinary shares of 1p
each....................................................................................................
. 142,857,143 1
In issue at 31 December 2019(1)
....................................................................................................... 485,348,166 4,032
----------- ------------
Issued:
Ordinary shares of .01p
each.................................................................................................. 162,500,000 20
Ordinary shares of .01p
each.................................................................................................. 7,142,857 1
In issue at 31 December
2020.......................................................................................................... 654,991,023 4,798
----------- ------------
Deferred shares at 31 December 2019 and 2020 (1)
....................................................................... 342,491,023 -
----------- ------------
(1) On 14 November 2019, each ordinary share of 1 pence were
divided into one New Ordinary Share of 0.01 pence par value and one
deferred share of 0.99 pence stated value, as previously described.
The Deferred shares have no rights to participate in profits and
losses of the Company.
D uring 2019, 830,780 ordinary shares were issued upon the
exercise of warrants.
On 5 May 2020, the Company issued 162,500,000 new ordinary
shares at 0.004 pence per share and received US $0.8 million of net
proceeds.
On 14 May 2020, the Company issued 7,142,857 new ordinary shares
upon the exercise of a warrant.
On 18 November 2019, the Company issued 142,857,143 new ordinary
shares at 0.42 pence per share and received US $0.7 million of net
proceeds.
On 25 March 2019, the Company placed 45,000,000 new ordinary
shares at 6 pence per share and received US $3.3 million of net
proceeds.
Share premium represents the excess over nominal value of the
fair value consideration received for equity shares net of expenses
of the share issue.
The Deferred shares were issued pursuant to a corporate
restructuring and consequent capital reorganization approved by the
Company's shareholders on 14 November 2019 in accordance with which
each Ordinary Share of 1 penny was subdivided into one new ordinary
share of 0.01 pence and one deferred share of 0.99 pence. The
deferred shares have no rights to participate in the profits of the
company and the Company has not issued any share certificates or
credited CREST accounts in respect of them. The deferred shares
were not admitted to trading on AIM.
Retained deficit represents accumulated losses and a Formation
reserve that arose when Motif Bio plc re-organized and became the
parent entity of Motif Biosciences, Inc.in 2015. Being a common
control transaction and, therefore, outside the scope of IFRS 3, it
was accounted for as a group re-organization and not a business
combination.
14. Subsequent events
In January 2021, the Company divested the ownership of Motif
Biosciences, Inc. to Orange Avenue Technologies, LLC ('Orange'), an
entity controlled by John Palmer of Tamarack Associates Inc. Mr.
Palmer, through Tamarack Associates Inc., was previously appointed
in early 2020 as the sole Executive Officer of Motif BioSciences.
Under the Stock Purchase Agreement with Orange, the Company will
receive 90% of the revenues received by Inc. from iclaprim, above a
$250,000 threshold.
On 27 January 2021 and 29 March 2021 Motif provided the market
with updates regarding the proposed Reverse Takeover via RNS, in
which the Company confirmed that it would remain suspended from
trading while the proposed transaction was negotiated and advanced.
If the Company is unable to complete reverse takeover transaction
for re-admission of trading on AIM the listing of the Company's
common shares will be cancelled.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
FR VKLFBFELLBBX
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