Announcement PDF BPH GLOBAL LTD ACN 009 104 330 Level 5, 126 Phillip Street, Sydney NSW 2000, Australia 31 July 2023 Company Announcements Pla�orm Australian Securi�es Exchange Quarterly ac�vi�es report BPH Global Limited (ASX: BP8) (BP8 or the Company or the Group), a plant-based biotechnology company, today released its Appendix 4C and Quarterly Ac�vi�es Report for the period ended 30 June 2023. Corporate ac�vi�es and fundraising • Cash posi�on: BP8 ended the quarter with cash of approximately $0.51 million ($0.98 million at 31 March 2023). • Extraordinary general mee�ng: During the quarter, the Company conducted an Extraordinary General Mee�ng (held on 9 June 20230) and obtained shareholder approval for, amongst other maters: • • • • • ASX Lis�ng Rule 7.4 approval to refresh its 15% issuing capacity under L.R. 7.1; L.R. 7.1 approval of the issue of the placement op�ons to placement investors; L.R. 10.11 approval for purchase of shares by directors and former directors; L.R. 7.1 approval for a share placement to professional and sophis�cated investors with a capacity of up to 250,000,000 shares (Placement Authority); and Approval to change the name of the Company from Stemcell United Ltd to BPH Global Ltd. • Chairman: During the Quarter, Mr Paul Rosen resigned as Non-Execu�ve Director and Chairman of the Company. Exis�ng Non-Execu�ve Director of the Company, Mr Paul Stephenson, was subsequently appointed as independent Non-Execu�ve Chairman of the Board. • Board review of opera�ons: Trading in the Company’s securi�es re-commenced on 30 March 2023. Since that �me, the new Board has conducted a rigorous assessment of the Company’s business opera�ons, employees’ competencies, organisa�onal culture, and financial posi�on. This assessment review of past, current, and proposed opera�ons is ongoing. Recent opera�onal decisions as outcomes of this review process include the appointment of Gaia Mariculture Pte Ltd (Gaia Mariculture) to manage the Company’s research and development facility at the Singapore Marine Aquaculture Centre and the closure of the Company’s premises at Defu Lane in Singapore. The new Board has Implemented a variety of cost-saving measures, including a reduc�on in Director fees, contractors, and excess headcount. The Company has also, during the quarter, terminated all agreements with advisors as announced on 18 May 2023. Termina�on of the advisory agreements alone will save the Company approximately $48,000 per annum. The savings realised through all these efforts will be wisely reinvested in key opera�onal areas of the Company’s business. This focused approach to cost reduc�on and strategic capital u�lisa�on has and will yield tangible results, and we an�cipate con�nued progress in this area. • Related party remunera�on: Total aggregate cash payments of $26,000 were made during the quarter to related par�es and their associates as remunera�on. Details of these payments are included in items 6.1 and 6.2 of the Appendix 4C. Placement Authority Pursuant to the Placement Authority the Company is authorised to issue up to 250,000,000 shares at a minimum issue price per share equivalent to a discount of 25% of the previous 15 days VWAP from the issue date to sophis�cated and professional investors. Placements made pursuant to the Placement Authority will provide funding to be used principally for the development of the Company’s bird’s nest business ac�vi�es. In par�cular, the Board views the proposed sales of raw bird’s nest and manufactured bird’s nest products in China as the Company’s best op�on to produce material revenue streams in the near term. The funding will also be essen�al to secure its opera�ons, par�cularly the opera�on of the Company’s seaweed R&D facility in the Singapore Marine Aquaculture Centre on St John’s Island in Singapore. The R&D facility focuses its research into the viability and commercial feasibility of cul�va�ng, harves�ng, and processing seaweeds and sea plants in Singapore and Australia. The execu�ve Directors will engage widely and deeply with poten�al investors and financiers in Australia, China and the APAC region to raise funds pursuant to the Placement Authority. Prospec�ve investors include exis�ng shareholders, contacts of the Company in Australia, China and the APAC region, contacts of the Company’s sales and distribu�on network in China and clients of the Melbourne office of Sanlam Private Wealth in both Australia and China. As previously announced on 20 July 2023, one of the primary reasons for the visit by the Company’s execu�ve directors to China is to nego�ate the terms of a share placement to one or more China-based cornerstone investors. Given the Company’s focus on China as a key market for its bird’s nest products, the Board believes that atrac�ng a China-based cornerstone investor(s) that understands and can assist with its business strategy and opera�ons in China will prove to be a strategic advantage. The Company’s fundraising ac�vi�es in China are taking place while the Company con�nues to engage with poten�al investors in Australia and the Asia Pacific region to raise funds pursuant to the Placement Authority. Bird’s Nest business During this current repor�ng period, the Company has con�nued its focus on the development of its bird’s nest business. Ac�vi�es undertaken during this period include: • • • • Michael Huang: Mr Michael Huang re-joined the board in early July 2023, bringing his exper�se and network in sales and distribu�on and bird’s nest businesses in China back to the Company. Mr Huang took the lead role on behalf of BP8 in conduc�ng the pilot program in China in late 2022 and early 2023. The pilot program trialled supply and distribu�on channels for the sale of bird’s nest products via China Tobacco’s outlets in Guangzhou and via social media influencers on Douyin, the China version of TikTok. China Visit: Following on from the re-appointment of Michael Huang as a Director of the Company, the execu�ve Directors are working with Mr Huang on reac�va�ng and expanding the Company’s bird’s nest business in China. This ini�a�ve builds on the pilot program which successfully trialled supply and distribu�on channels for the sale of bird’s nest products via China Tobacco’s outlets in Guangzhou and via social media influencers on Douyin, the China version of TikTok, from December 2022 to February 2023 (Pilot Study). Given these new opportuni�es and following on from the Board’s review of previous bird’s nest opportuni�es, the Company is not ac�vely seeking to re-engage with Ah Yat Abalone Princess (HK) Ltd (Ah Yat). In rela�on to Yunnan Hongyi Agriculture Development Co Ltd, Michael Huang will lead the Company’s ini�a�ve to explore commercial sales of bird’s nest products to this Company in due course. China Tobacco: To consolidate the Company’s plans for growing its sales and distribu�on footprint for bird’s nest products in China, the Company is nego�a�ng the terms of an agreement with its Pilot Study partners for the assignment of the two (2) China Tobacco sales and distribu�on contracts to the Company or the acquisi�on of their Pilot Study partners’ corporate en�ty that holds the rights to the relevant sales and distribu�on contracts. The Company plans to finalise the nego�a�ons on the terms of this agreement during August 2023. Trademarks: The Company is also nego�a�ng the terms of an agreement with its Pilot Study Partners for the acquisi�on of the rights to use the trademarks pursuant to which the bird’s nest products were sold in conduct of the Pilot Study or the acquisi�on of the Pilot Study partners’ corporate en�ty that owns the relevant trade marks. The Company plans to finalise the nego�a�ons on the terms of this agreement during August 2023. Resina The Company previously supplied processed resina in cake form to Zhejiang Forest Rainbow Medical Co Ltd (ZFRM) as raw material for subsequent processing into other TCM products by that company. Given the BP8 is priori�sing the sales and distribu�on opportuni�es in its bird’s nest business in China via China Tobacco and Douyin, the Company is not an�cipa�ng the commencement of nego�a�ons with ZFRM for a new resina supply agreement un�l at least Q4 2023. Seaweed • • • • Gaia Mariculture: As announced previously on 12 July 2023, the R&D facility management agreement with Gaia Mariculture Pte Ltd (Gaia Mariculture) will maximise the Company’s focus on further developing the Company’s proprietary technology for the commercial cul�va�on of seaweed in Australia and Singapore. Pursuant to the Consul�ng Agreement, the services to be provided by Gaia Mariculture to the Company include: • general consul�ng and advice on the opera�on of the R&D facility, including assistance in maintaining the Company’s rela�onship with the Singapore Food Agency (SFA) and the tenancy agreement with the SFA regarding the R&D facility; • consul�ng and advice on the establishment and opera�on of research into the viability and commercial feasibility of cul�va�ng, harves�ng and processing seaweeds and sea plants in Singapore and Australia (Research Projects); and • undertaking Research Projects on seaweed cul�va�on and/or seaweed processing using the student interns engaged by the Company, and report results and outcomes of those Research Projects to the Company. Floa�ng pla�orm, East Johor Strait: The Company’s review of the commercial feasibility and u�lity of the floa�ng pla�orm is ongoing as the Company considers the available op�ons to maximise the value that can be achieved from either its reten�on or sale. The Company con�nues to be in contact with its joint venture partner Rong Yao Fisheries in rela�on to the conduct and findings of this review. Baker’s Oven: In the context of the Company’s ongoing review of its seaweed opera�ons, a review of the Baker’s Oven supply agreement is also being undertaken. Any maters arising out of this review will be discussed with Baker’s Oven. Business development manager: A�er reviewing the Company’s seaweed opera�ons as conducted in the year prior to the re-commencement of trading in the Company’s shares, the Company does not intend to appoint a seaweed business development officer in Singapore at this �me. Hemp Given the Company is priori�sing the sales and distribu�on opportuni�es in its bird’s nest business in China via China Tobacco and Douyin, the Company is not an�cipa�ng the commencement of nego�a�ons with Yunnan Hongyi Agriculture Development Co Ltd or Heilongjiang Beimei Industrial Hemp Technology Co Ltd un�l at least Q4 2023. The Company an�cipates that discussions regarding both bird’s nest and hemp opportuni�es with Yunnan Hongyi Agriculture Development Co Ltd will be held concurrently. These discussions will be led by the Company’s director based in China, Mr Huang. Lantene As announced on 24 April 2023, the Company has not been paid the outstanding purchase price for the sale of its remaining 45% shareholding in Shenzhen Lantene Dingzhi Biotechnology Co Ltd (Lantene) in accordance with the terms of the original sale agreement entered into with the buyer, Mr Cao. The Company is currently considering its legal op�ons in rela�on to such mater and is also conduc�ng ongoing discussions with the buyer, Mr Cao, regarding payment of this outstanding debt and comple�on of the sale of its shareholding in Lantene. - END Authorised for lodgement by the Board of the Company. For further informa�on, please visit our website at www.bp8global.com or contact: Mr Paul Stephenson BPH Global Limited Chairman E: pauls@bp8global.com Rule 4.7B Appendix 4C Quarterly cash flow report for entities subject to Listing Rule 4.7B Name of entity BPH GLOBAL LIMITED ABN Quarter ended (“current quarter”) 57 009 104 330 30 June 2023 Consolidated statement of cash flows Current quarter $A’000 Year to date (..12..months) $A’000 - 4,684 - (5) (99) (4,084) - (68) (d) leased assets (22) (124) (e) staff costs (102) (470) (f) (253) (1,431) 1. Cash flows from operating activities 1.1 Receipts from customers 1.2 Payments for (a) research and development (b) product manufacturing and operating costs (c) advertising and marketing administration and corporate costs 1.3 Dividends received (see note 3) - - 1.4 Interest received - - 1.5 Interest and other costs of finance paid - (15) 1.6 Income taxes paid - - 1.7 Government grants and tax incentives - - 1.8 Other (provide details if material) - - 1.9 Net cash from / (used in) operating activities (476) (1,513) ASX Listing Rules Appendix 4C (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms. 11807478_2 Page 5 Appendix 4C Quarterly cash flow report for entities subject to Listing Rule 4.7B Consolidated statement of cash flows 2. Cash flows from investing activities 2.1 Payments to acquire or for: 2.2 Current quarter $A’000 Year to date (..12..months) $A’000 (a) entities - - (b) businesses - - (c) property, plant and equipment - (58) (d) investments - - (e) intellectual property - - (f) - - (a) entities - - (b) businesses (Net) - 65 (c) property, plant and equipment - - (d) investments - - (e) intellectual property - - (f) - - other non-current assets Proceeds from disposal of: other non-current assets 2.3 Cash flows from loans to other entities - - 2.4 Dividends received (see note 3) - - 2.5 Other (provide details if material) - - 2.6 Net cash from / (used in) investing activities - 7 3. Cash flows from financing activities 3.1 Proceeds from issues of equity securities (excluding convertible debt securities) - 1,622 3.2 Proceeds from issue of convertible debt securities - - 3.3 Proceeds from exercise of options - - 3.4 Transaction costs related to issues of equity securities or convertible debt securities - (71) 3.5 Proceeds from borrowings 11 11 3.6 Repayment of borrowings - (95) 3.7 Transaction costs related to loans and borrowings - - 3.8 Dividends paid - - 3.9 Other (provide details if material) - - 3.10 Net cash from / (used in) financing activities 11 1,467 ASX Listing Rules Appendix 4C (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms. 11807478_2 Page 6 Appendix 4C Quarterly cash flow report for entities subject to Listing Rule 4.7B Consolidated statement of cash flows Current quarter $A’000 Year to date (..12..months) $A’000 981 625 4. Net increase / (decrease) in cash and cash equivalents for the period 4.1 Cash and cash equivalents at beginning of period 4.2 Net cash from / (used in) operating activities (item 1.9 above) (476) (1,513) 4.3 Net cash from / (used in) investing activities (item 2.6 above) - 7 4.4 Net cash from / (used in) financing activities (item 3.10 above) 11 1,467 4.5 Effect of movement in exchange rates on cash held (5) (75) 4.6 Cash and cash equivalents at end of period 511 511 5. Reconciliation of cash and cash equivalents Current quarter $A’000 Previous quarter $A’000 at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts 5.1 Bank balances 511 176 5.2 Call deposits - - 5.3 Bank overdrafts - - 5.4 Other (provide details) - Cash in lawyer trust account - 805 511 981 5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above) 6. Payments to related parties of the entity and their associates Current quarter $A'000 6.1 Aggregate amount of payments to related parties and their associates included in item 1 26 6.2 Aggregate amount of payments to related parties and their associates included in item 2 - Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must include a description of, and an explanation for, such payments. ASX Listing Rules Appendix 4C (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms. 11807478_2 Page 7 Appendix 4C Quarterly cash flow report for entities subject to Listing Rule 4.7B 7. Financing facilities Note: the term “facility’ includes all forms of financing arrangements available to the entity. Add notes as necessary for an understanding of the sources of finance available to the entity. Amount drawn at quarter end $A’000 Total facility amount at quarter end $A’000 7.1 Loan facilities - - 7.2 Credit standby arrangements - - 7.3 Other (please specify) - - 7.4 Total financing facilities - - 7.5 Unused financing facilities available at quarter end 7.6 Include in the box below a description of each facility above, including the lender, interest rate, maturity date and whether it is secured or unsecured. If any additional financing facilities have been entered into or are proposed to be entered into after quarter end, include a note providing details of those facilities as well. - - 8. Estimated cash available for future operating activities $A’000 8.1 Net cash from / (used in) operating activities (item 1.9) (476) 8.2 Cash and cash equivalents at quarter end (item 4.6) 511 8.3 Unused finance facilities available at quarter end (item 7.5) 8.4 Total available funding (item 8.2 + item 8.3) 8.5 Estimated quarters of funding available (item 8.4 divided by item 8.1) 511 (1.07) Note: if the entity has reported positive net operating cash flows in item 1.9, answer item 8.5 as “N/A”. Otherwise, a figure for the estimated quarters of funding available must be included in item 8.5. 8.6 If item 8.5 is less than 2 quarters, please provide answers to the following questions: 8.6.1 Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not? Answer: Yes 8.6.2 Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful? Answer: Yes. Placements will be conducted to raise cash to fund the operations. 8.6.3 Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis? Answer: Yes. Placements will be conducted to raise cash to fund the operations. Note: where item 8.5 is less than 2 quarters, all of questions 8.6.1, 8.6.2 and 8.6.3 above must be answered. ASX Listing Rules Appendix 4C (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms. 11807478_2 Page 8 Appendix 4C Quarterly cash flow report for entities subject to Listing Rule 4.7B Compliance statement 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A. 2 This statement gives a true and fair view of the matters disclosed. Date: .............31 July 2023........................................... Authorised by: ...........the board of directors....................................... (Name of body or officer authorising release – see note 4) Notes 1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity’s activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so. 2. If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 107: Statement of Cash Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standard applies to this report. 3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity. 4. If this report has been authorised for release to the market by your board of directors, you can insert here: “By the board”. If it has been authorised for release to the market by a committee of your board of directors, you can insert here: “By the [name of board committee – eg Audit and Risk Committee]”. If it has been authorised for release to the market by a disclosure committee, you can insert here: “By the Disclosure Committee”. 5. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations, the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively. ASX Listing Rules Appendix 4C (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms. 11807478_2 Page 9