EcoSynthetix Inc. ($ECO)

[Audio Gap] My name is Jeffrey Nodland and I'm Chairman of the Board, EcoSynthetix and pursuant to the EcoSynthetix by laws, I will chair this meeting. Rob Haire, the Chief Financial Officer and Corporate Secretary of the company, will act as the Secretary of this meeting. We'd also like to welcome those who attending via conference call to listening to the meeting today. After the meeting, Jeff MacDonald, our Chief Executive Officer of the company, will make a presentation, after which there will be a period for any questions you may have. For purposes of this meeting have appointed TSX Trust Company through its representatives Amanda Dello and Mark Bert to act as the scrutineer. Ms. Dello and Mr. Bert are attending the meeting via conference call. We will now proceed with the business of the meeting. The company has used notice and access to deliver the meeting materials to the shareholders. I've been advised that on April 20, 2026, the noted and access notifications were mailed to all shareholders of record as of April 2, 2026, in accordance with all applicable laws. In addition, the meeting materials, including the notice and access notification, the notes of meeting, form of the proxy and Management Information Circular, were posted on the corporation's website on a dedicated website maintained by TSX Trust Company to host the media materials and under the corporation's profile on SEDAR at www.sedarplus.ca. TSX Trust Company has filed with me proof of service of such mailing and I direct that a copy of such proof of service be annexed to the meeting -- minutes of this meeting as a schedule. I will dispense calling for a reading of the notice of this meeting. The scrutineer has also advised me that prior to the meeting, proxies were received from the holders of a sufficient number of common shares to constitute a quorum. And accordingly, I declare a quorum present and that the meeting is regularly called and properly constituted for the transaction of business. I direct that the formal report of the scrutineer be annexed to the minutes of this schedule -- meeting of this minute -- minutes of this meeting as a schedule. We are asking the name participants present in person here today to complete the provided attendance indicating your name, your address and shareholder and any proxy holder if applicable. Once completed, we will ask each person to leave your tenant sheet on the table at the end of the meeting in the designated area. The attendance sheet will be collected and provided to the scrutineer and to any other representatives of our transfer agent as required. I would like to take a moment to comment on the voting procedure to be used at today's meeting. Voting will proceed by the way, a show of hands, except and voting for directors of the company and voting for the approval of unallocated options under the company's 2011 stock option plan will proceed by the way, at ballot. If you're a regulated shareholder or price silver, you will be required to complete the ballot that has been placed in front of you. With respect to each matter to be considered at today's meeting, I will ask for a motion. Only registered shareholders or duly appointed proxy holders can make a motion or address the meeting with respect to a pending motion. Shareholders attending the meeting by conference call will be able to listen to the meeting and ask questions, but will not be able to vote over the phone. As the first item of business of this meeting, I will now present to the meeting the company's consolidated financial statements as at and for the financial year-end December 31, 2025. Copies of the financial statements were mailed to the shareholders in accordance with the applicable law. The next item of business is the appointment of auditors for the ensuing year and the authorization for the Board to fix their remuneration. I would ask for a motion for an ordinary resolution that PwC, PricewaterhouseCoopers, chartered professional accountants, be appointed as auditors of the company to hold office for the ensuing year or until a successor is appointed at such remuneration as may be fixed by the Board of Directors. Will someone move that resolution.

I so move.

Thank you. The motion is now on the floor. All shareholders and proxy holders in favor of the resolution, please so signify by raising your hand. [Voting]

Contrary, if any? [Voting]

I declare the resolution carried. The next item of business is the election of the directors. The meeting is now open for the nomination of the 5 directors to be elected to the company's shareholders -- by the company's shareholders to hold office until the close of the first annual meeting of the shareholders following such election or until successors are elected for appointment are appointed. No as a director nomination is outstanding pursuant to the company's advance notice bylaw. Accordingly, at the meeting, the only persons all to be nominated for election to the Board are the management nominees. Management nominees include Jeffrey Nodland, Jeff MacDonald, Susan Allen, Sara Elford and Greg Yull. As directors for the ensuing year or on cell successors are elected or appointed. I will now call for a motion to elect the directors. As a result of the company's majority voting policy, it is necessary to vote that ballot for the election of each director. Therefore, direct that a poll be taken. A shareholder or proxy nominee should record his or her vote in respect of the election of each director nominee by marking the appropriate box besides each structure name and by signing and printing his or her name on the ballot. Once you've completed the ballot, I will ask you place your ballots on the designated tables so that they may be scanned and transported to the scrutineer. Prior to the meeting, I was advised by the scrutineer that the proxies deposited for the meeting were overwhelmingly voted for the election of each director nominated. Therefore, I declare Jeffrey Nodland, Jeff MacDonald, Susan Allen, Sara Elford, Gregory Yull to be elected as your Board of Directors to serve in that capacity until the company's next Annual General Meeting or until successors are elected or appointed. Rather than hold up the business of this meeting for the final tabulation of votes cast, I direct the results of the poll for the election of the directors be included with the minutes of this meeting and filed on SEDAR. The next item of business is the approval of the unallocated options under the company's 2011 stock option plan, as more particularly described in the management information circular. In order to be effective, this resolution must be approved by the affirmative vote of not less than a majority of the votes cast at this meeting. I will now call for the motion to approve the resolution set out under the heading, particular matters to be active upon approval of the unallocated stock options on Page 16 of the management information circular. Will someone move that motion.

I so move.

Motion is now on the floor. Prior to the meeting, I was advised by the stutter that more than 5% of the proxies deposits in the meeting were voted against the resolution. As a result, it is necessary to vote by ballot on the approval of the unallocated options under the company's 2011 stock option plan. Each shareholder or proxy nominee should record his or her vote in respect of the approval of the unallocated options under the company's 2011 stock option plan by marking a trophy bots and signing and printing his or her name on the ballot. Once you've completed your ballot, I will ask you to place your ballot on the designated tables so that they can be scanned and transmitted to the scrutineer. Prior to me I was advised by the scrutineers that the proxies deposited for the meeting were sufficiently voted for the approval of the unallocated options under the company's 2011 stock option plan. Therefore, I declare the resolution carried, again, rather didn't hold up the business of this meeting for the final tabulation of votes cast, I direct a the -- the results of the poll for the approval of the unallocated options under the company's 2011 stock option plan be included with the minutes of this meeting and filed on SEDAR. As there is no further business, I will ask that someone make a motion for this meeting to now terminate.

I so move.

All shareholders and proxy holders in favor of this resolution, please so signify it by raising your hands. [Voting]

Contrary, if any? [Voting]

I declare that this meeting is now terminated. And with that, I would like to turn it over to Jeff MacDonald.

Thanks, Jeff. As I get started here, I'll just point out that the slides that we'll be going through here can be found on our corporate website under investors/events. So here at EcoSynthetix, everything we do is about delivering bio-based solutions to solve the sustainability or health imperative in the markets that we've chosen to target. We've chosen markets that have a driver, which required the carbon footprint reduction or a healthier solution versus the incumbent chemicals used in that space today. Green is not being enough though. So we also need to demonstrate performance that's at least equivalent to the incumbent chemistries that we replaced and competitive economics. And we can show that we've done that in each of the markets we're targeting today. So how do we do that? All of our products start in the field as the majority input to the polymers we produce and mainly in the corn field. So we start with a derivative of corn, and we transform it using our proprietary reactive extrusion process into a polymer. As the polymer is created in our reactive extrusion process, we're adding different heat, pressure and chemistry to it to allow it to do what it needs to do in the given application that we're targeting. At the end of our process comes a dry powder, and that's fairly unique in the chemistry world in that we're shipping something that's dry and not, let's say, up to 50% water, which also provides our customers with both the cost and sustainability benefit. And then lastly, as we are a disruptive chemicals company, we can't expect that a company just receives our product and is able to implement it successfully on their own. We provide a team and engineering support to be able to have them introduce that in the easiest way possible and drive change accordingly. The markets we've targeted with these polymers are really 3 that we're most focused on today. First is the pulp, tissue and paper packaging market. Second is would composite panels. And third is our personal care market, and I'll go through each of these in more detail. A few key things you should know about our positioning in the market while many companies may have interest in green ideas, our green technology was scaled successfully early on in the development of our company and is fully scaled today. We're active in producing our product in both Canada for the North American market and in the Netherlands for Europe and Asia, and these are facilities which are capable of producing in the magnitude of about 5x our current output before we need to recapitalize the business. So that allows us to grow to in excess of $100 million with the existing footprint we have in place. The markets we've targeted are large. Each of these 3 markets that I'll mention are detailed in further detail as I work through the presentation. But first of all, we're targeting in the wood panel space to replace urea formaldehyde, which is a $15 billion resin category. And most of the particleboard MDF Board in the form of wood panels is produced using urea formaldehyde resins today, and that represents about a $15 billion market opportunity. In the pulp and paper industry, we're replacing coatings that are made from styrene-based latexes as well as offering strength aids for pulp-based products, and that represents an addressable market of over $1 billion. And then lastly, in the personal care space, our products are showing broader capability than simply the hair care fixative that we started with. But if we just look at the hair care fixatives, that's a $460 million market. today. So all robust, growing addressable markets that have substantial scale for us to dig into. The business has been on a path of transition for the past 5 years. We recognized early on that the initial market we had proven our products in, which was graphic paper, was a declining market with the advent of technology. and we needed to diversify. So we began developing a range of diversified products for the markets I've just described. And over the past 5 years, as we've gained our initial commercial traction, the business has transformed away from graphic paper and into these more attractive and growing diversified markets. So you can see in the blue graph bars here, the share of graphic paper has declined steadily as we expected it to over the past 5 years but it's been more than replaced by the new markets that we've targeted. And while we've done that, we've been able to bring greater value to the customers in those spaces, and you can see that, that's resulted in some pretty interesting margin expansion at the same time. So if we dig a little deeper into each of these markets, we got our start in the pulp and paper industry in graphic paper coatings. And while that is a declining market, as I just mentioned, it's provided some very formative relationships to some new growing spaces within pulp and paper that we've been able to rely on through our initial start in the space into some of these new applications. So in this space today, we remain active in the coating space, where we're providing sustainable coating binders, barrier resins and coatings for specialty papers, but the more interesting and more rapidly growing space, where we have a very interesting value offering is in pulp-based products right from the creation of pulp through to tissue and packaging. And I'll explain a little bit more about how we add value in those spaces. But one of the most important drivers in this pulp space is the shift in dynamics of where the wood fiber is coming from. So softwood fiber is the longest and strongest fiber available in the market, but it's under increasing pressure as there is less software available to address some of these growing markets. And as a result of that, softwood prices continue to go up relative to hardwood fiber around the world. Hardwood fiber has typically grown more like a conventional crop. So we can see eucalyptus plantations that are grown at 7-year intervals relative to the 17- to 20-year intervals that's required for softwood production. And that hardwood fiber, while widely available, is inherently less strong than the softwood fiber. So for it to be a direct replacement as the shift continues, it needs help, and that's where our polymers come in to provide added strength to the hardwood fiber such as eucalyptus fiber. And what you see in the graph there is the result of that dynamic and shift between hardwood and softwood, that the gap in price between softwood and hardwood over time is continuing to grow. And we're playing within that value gap by allowing our customers to make greater use of hardwood fiber and replace softwood fiber and thereby achieve a cost savings in doing so. By doing that, in a relatively short time within the pulp and paper industry, we've managed to commercialize 15 lines, 8 of those came in the last year. We've done this through a combination of direct sales to some of the larger players as well as establishing a significant network of distributors around the world who carry chemistries into paper mills and help with the implementation of our chemistry on lines around the world. Some of those are tissue lines. Some of those are packaging lines. And one of those happens to be a company in the origin of pulp creation, so the largest pulp manufacturer in the world. is a customer of ours and has already grown to be a top 5 account. So here, we're helping a customer to transform pulp into a stronger pulp using their natural hardwood fibers. And so therefore, allowing that hardwood fiber to be used in places where softwood fiber may have been required in the past. That allows them to achieve a higher value product and allows their customers to achieve a more reliable source of supply at better cost. This chart shows the lead table of tissue producers and pulp manufacturers around the world. So these are our main targets as we take our SurfLock lock product around the world into pulp and paper mills. We're active with key players on both sides of this table. So if we shift to wood composites, the imperatives in this market that we're trying to address are the elimination of formaldehyde, which is a known carcinogen, which is typically used as the glue and holding particle board together and to make a significant reduction in carbon footprint, which is a key driver for many players in the wood panel and specifically in the furniture industry. While those imperatives remain super critical and while we have been competitive from a performance and cost basis, there's also a bit of a silver lining to the current oil price pressures that we're seeing around the world as urea and formaldehyde prices have shot up significantly, which should be a tailwind to us as we move forward in this space. Probably the biggest tailwind we have on a consistent basis is with a major retailer who has adopted our product commercially in their transition to bio-based glues. And you can see here that they've done quite a bit of promotional activity on the shift and its importance to the reduction of their carbon footprint and creating healthier products for their customers. The customer has a track record of taking on issues like this and leading the market away from chemicals of concern. And we believe that the formaldehyde reduction is next on their list and they're backing that up with the activity that you see there on the right. One of their operations is a significant user of our product today, and it is -- and they are transitioning use of our product into other mills currently as well. They represent a significant opportunity for us on their own to satisfy their demand, which they have stated as their goals. Would require $50 million to $60 million of our product. But that can be the tip of the iceberg with them as a thought leader as this is a $15 billion market that we can address with our resin solutions. Each one of these wood panel production lines represents about a $3 million opportunity to us. And again, if we look at the lead table on the left, we're active with several players on the left side and commercial with some of them already. And then among our target markets last but not least, we have a very interesting line of personal care products, which we knew were going to be interesting for the market. But we didn't have the capability ourselves to do the applications and marketing development work necessary to take ingredients to the personal care market on a large scale. So we chose a partnership approach in this case, and we've come together with Dow as a development and marketing partner for our product line, which they rebrand and market as Maze care. This has been an interesting steadily growing new product for them and for us. which initially started in hair care. And within the last year, they've created a range of new formulations targeting skin care and color cosmetics. And then lastly, I guess what I'll say in terms of how we introduce ourselves to new customers. The conversation often starts with the green the green banner, how can you help us to reduce our carbon footprint to create healthier products. And then obviously, we have to demonstrate the performance and capability of our product from there. Looking at this climate positive performance chart, if you look about halfway down the page, that Scope 1, 2, 3 line represents our carbon footprint as a company, which is just over 15,000 tonnes of carbon dioxide equivalent. But where it becomes very interesting is that by putting the products that we create using that carbon input, we're able to much more than offset our own carbon footprint by the carbon we save for our customers. And you can see the first line there where we show 1.27:1 carbon cover. This is without the accounting for the carbon that goes into the bio-based input that we use. So we're using corn, the corn absorbs carbon from the atmosphere and we are able to dollarize that as well within our customers' products. So the second line shows exactly that. If we count the carbon that is taken up by the corn and its growth, we're at approximately a 2:1 carbon cover today. So for every ton of carbon that we invest in developing our business, we're allowing our customers to cover 2 tons of carbon. And that number only gets better as we sell more of our products. So we've chosen the right markets. We have blue chip customers in each of those spaces, and those blue chip customers alone represent enough opportunity to take us over our $100 million sales goal. We believe we're working with the right partners. We will continue to expand the partners that we're working with, but the opportunity is there for us to really accelerate our growth and achieve our goals of getting to $100 million in sales as our next step in the development of our business. So that's a fairly simple overview of the business, but I'd be happy to answer any questions anyone on the line may have.

[Operator Instructions] Ladies and gentlemen, there are no questions. The conference has now ended. Thank you all for joining. You may now disconnect your lines.