Kane Biotech Inc. (KNE) Earnings Call Transcript & Summary

Hello, everybody, Marc Edwards. I'm the CEO of Kane Biotech. Welcome to our Annual and Special Meeting of the Shareholders of Kane Biotech. I have been asked to say maybe a few words before we get everything underway. As is no surprise to anybody, we are in the middle of a global pandemic. On behalf of Kane management and Board and the entire team, I wanted to first thank and recognize the work that all of the frontline workers are doing, from the nurses to the grocery store clerks, so on and so forth. We're privileged to be able to continue to work from home and not -- and minimize the risk to our health, and we appreciate the work and effort that they've -- that they're doing. Now also because of the pandemic, this is our first AGM virtual conference call. This is a first for us here. So please bear with us as we learn to navigate through this. I have -- Ray and I are both the co-admins of this meeting today, Ray Dupuis, our CFO. I've muted everybody, and we'll unmute a few key people there that need to talk. But I will let Ray and Philip Renaud, our Chairman, take it away. And yes. So Philip Renaud and Mark Nawacki, you should be able to unmute yourself at this point. And then Georges and Sarah. Okay. So Philip, I'll let you take it away.

Okay, thank you. Sorry, I just got disconnected. Welcome, everybody, and thank you for joining us tonight. The meeting will now come to order. My name is Philip Renaud, Chairman of the corporation. This is the Annual and Special Meeting of the Shareholders of Kane Biotech. Pursuant to the bylaws of the corporation, I will act as chairman of the meeting, and Ray Dupuis will act as secretary of the meeting. I appoint Kirsten Dillon of AST Trust Company as scrutineer. The notice calling this meeting of shareholders was mailed to all shareholders of record on April 15, 2020. The secretary will [indiscernible] declaration as to such mailing to the minutes of the meeting. Will the scrutineer please submit the report on attendance? The scrutineer's report is as follows, and I have it here in front of me. The securities eligible to be voted at the meeting, common shares, 108,613,535. We are pleased to report that the following information on attendance at the meeting, the number of registered shareholders and proxy appointees attending at the meeting in person is 4. The number of shares represented by registered shareholders and proxy appointees in person, 2,501,999. The number of proxies received, 21. The number of shares represented by management proxy appointee, which is 53,905,654. The total number of shares represented at the meeting is 56,407,653. This represents 51.93% of the 108,613,535 issued and the outstanding common shares. I've read the scrutineer's report, and I hereby adopt the scrutineer's report. The notice having been mailed in accordance with the bylaws and the applicable policy, a quorum being present, I declare that this meeting is duly constituted for the transaction of business. The first item of business is to review and discuss the audited financial statements of the corporation for the year ended December 31, 2019, together with the auditors' report thereon, which have been approved by the directors of the corporation. Will the secretary please read the auditors' report?

The following excerpts are from the independent auditors' report written by Kane Biotech's auditors, MNP LLP. The date of this report is March 30, 2020. To the shareholders of Kane Biotech, Inc., we have audited the financial statements of Kane Biotech, Inc., which comprise the statements of financial position as at December 31, 2019, and December 31, 2018, and the statements of comprehensive loss, changes in equity deficit and cash flows for the years then ended and notes to the financial statements, including a summary of significant accounting policies. In our opinion, the accompanying financial statements present fairly in all material respects the financial position of the company as at December 31, 2019, and December 31, 2018, and its financial performance and its cash flows for the years then ended in accordance with International Financial Reporting Standards. We conducted our audits in accordance with Canadian generally accepted auditing standards. We are independent of the company in accordance with the ethical requirements that are relevant to our audits of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Thank you, Ray. Is there any discussion with respect to the financial statements?

No.

No? Thank you. The next item of the business is the election of directors. The bylaws of the corporation provide that the number of directors shall be fixed at 6 by the directors of the corporation. The directors of the corporation have fixed the number of directors at 6. The meeting is now open for nominations. Nominations. I nominate the following as directors: myself, Philip Renaud; Marc Edwards; Mark Nawacki; Rivka Gluck, Georges Morin and Sarah Prichard. Are there any more nomination?

No.

If there are no further nominations, would someone move that the nomination be closed?

I, Mark Nawacki, move that nominations be closed.

Do I have a seconder?

I, Marc Edwards, second that motion.

Yes. Thank you, Marc. You have heard by the motion by Mark Nawacki and second by Marc Edwards, all those in favor, please signify by raising your right hand. [Voting]

Okay. Any contrary? [Voting]

Carried. I now declare Philip Renaud, Marc Edwards, Mark Nawacki, Rivka Gluck, Georges Morin and Sarah Prichard elected directors of the corporation and to hold office until they resign or until their successors are duly elected or appointed. It is now in order to appoint the auditors of the corporation.

Be it resolved that MNP LLP chartered accountants of Winnipeg Manitoba, the appointed auditors of the corporation, to hold office until the next annual meeting or until their successors are duly appointed and the Board of Directors be authorized to fix the auditor's remuneration.

Thank you, Mark. Do I have a seconder for that motion? Marc?

Yes. Pardon me. Marc Edwards. I second that motion. The mute button was a little [ far ].

Thank you. You have heard the motion by both Mark Nawacki and second by Marc Edwards. All those in favor, please signify as a usual manner. [Voting]

Any contrary? [Voting]

Carried. I declare MNP appointed as the auditors of the corporation. The next motion, #3, is the reapproval of the stock option plan. The Board of Directors proposes to reapprove the stock option plan of the corporation that was most recently reapproved by the shareholders of the corporation at the Annual and Special Meeting of the corporation held on May 22, 2019. The stock option plan is a rolling stock option plan that provides that the number of common shares reserved for the issuance under the plan, together with any outstanding stock options, shall be equal to 10% of the issued and outstanding common shares of the corporation. Rolling stock option plans must be approved on an annual basis by the shareholders of the corporation pursuant to the policies of the TSX Venture Exchange. A copy of the stock option plan is available for inspection on SEDAR.

I, Mark Nawacki, move that it be resolved that the stock option plan of the corporation, which governs the way by which the corporation may grant stock options to various parties, submitted to the meeting and initiated -- and initialed, sorry, by the Chairman for identification purposes, be ratified and approved.

Thank you, Mark. Do I have a seconder for that motion?

I, Marc Edwards, second the motion.

Yes. You have heard the motion by Mark Nawacki and second by Marc Edwards. Is there any discussion on the motion? As there is no further discussion, will all those in favor of the motion, please signify by raising your right hand? [Voting]

Any contrary? [Voting]

Yes. Carried. Okay. And then we have the approval on motion 4. It Is the approval of the amended and restated bylaw #1. In response to the COVID-19 pandemic, the Board of Directors determined to make certain changes to the existing bylaw of the corporation to allow the corporation to conduct meetings of shareholders entirely virtually rather than in person. Accordingly, the only significant changes in the bylaw, the amended bylaw, is that we'll -- it now allows for meetings of the Board of Directors and shareholders to become conducted entirely by electronic means, provided that the electronic means permit all persons participating in the meeting to hear or otherwise communicate with each other and allow the corporation to provide notice to shareholders by electric means -- electronic means. The amended bylaws also makes a number of immaterial housekeeping changes to the existing bylaw.

Be it resolved that the new, amended and restated bylaw #1 relating generally to the conduct of the business and affairs of the corporation submitted to the meeting and initialed by the Chairman for identification purposes be and the same is hereby ratified and confirmed.