Ouch !! money for all, except shareholdersFinancial Condition: IBR
At March 31, 2007, the Company had total liabilities of $2,456,163, an increase of $776,353 from the year
ended June 30, 2006; the majority of the increase has come from loans advanced by directors of the
Company. The Company’s working capital position at March 31, 2007 was a deficiency of $1,979,288, and
long term liabilities consisted of two capital leases totalling $94,331.
IBR is dependent on cash generated by technology sales, contracts to
build plants or supply equipment for these plants, revenues from plant ownership, or new financing activities, in
order to meet its obligations. From April 1, 2007 to May 28, 2007, no additional technology sales or contracts to
build plants or supply equipment have been obtained. Until the Company generates significant sales, it will be
relying on new financing and any difficulty in raising new financing will have a significant impact on the
Company’s ability to operate.
Transactions with Related Parties:
During the nine months ended March 31, 2007, the Company paid management fees of $141,759 in lieu of
salaries to the President, the interim President, and the Chairman, and $24,900 to a director who provided
consulting services. In addition, directors receive a fee of $400 for each meeting or committee meeting
attended and directors’ fees and directors fees of $19,600 were expensed during the period and $43,091 was
due to management and directors at December 31, 2006.
As at March 31, 2007, the Company had loans of $854,470 due to four directors. The loans are secured by a
PPSA on the Company’s assets, are payable on demand, and earn interest at 12% per annum. Since the end
of year ending June 30, 2006, the Company received new loans from directors of $695,500, and an additional
$14,500 since March 31, 2007. During the nine months ending March 31, 2007, the Company expensed
$66,761 for interest on these loans and promissory notes, and paid $24,603 to directors for interest.
INTERNATIONAL BIO RECOVERY CORPORATION
MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE NINE MONTHS ENDED MARCH 31, 2007
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A promissory note of $295,000 is due to a director and is payable on demand or upon receipt of a cumulative
amount in excess of $2,500,000 from technology sales, earns interest at 15% per annum, and is secured by a
PPSA.
In early November, the Company settled a claim for severance pay and wrongful dismissal filed by its former
President and CEO, for a payment of $125,000, payable on a contingency basis upon the Company’s receipt
of license fees or equipment sales profits, without interest, in an amount equal to 10% of the payment received
or profit generated, until fully paid. Any unpaid amount after 5 years will be extinguished. As part of the
severance settlement, the former employee agreed to act as a consultant to the Company and was granted
200,000 stock options at a price of $0.35 per share to expire on July 15, 2008.