Announcement PDF Appendix 4D For the Half Year Ended 31 December 2016 Current Reporting Period – Half Year Ended 31 December 2016 Previous Reporting Period – Half Year Ended 31 December 2015 This report is to be read in conjunction with the 30 June 2016 Annual Report and is given in compliance with Listing Rule 4.2A. Revenues Up 41% to 31 Dec 2016 703,099 from 31 Dec 2015 497,220 Loss after tax attributable to members UP 45% to (3,409,349) from (2,354,743) Net loss for the period attributable to members UP 45% to (3,409,349) from (2,354,743) Net Tangible Asset per Security (cents per security) As at 31 December 2016 3.363 As at 31 December 2015 2.540 Dividends (distribution) Amount per Security Franked Amount per Security Current period n/a n/a Previous corresponding period n/a n/a Record date for determining entitlements to dividend n/a Details of dividend reinvestment plans in operation None Details of entities over which control has been gained or lost during the period None Details of Associates and Joint Ventures None These accounts have been subject to review and there has been no qualification or dispute. Explanation of the above information: Refer to the Directors' Report - Review of Operations. Approved Date: Tuesday, 28th February 2017 Appendix 4D Interim Financial Report For the Half Year Ended 31 December 2016 To be read in conjunction with the 30 June 2016 Annual Report. In compliance with Listing Rule 4.2A These financial statements have not been reviewed under US Public Company Accounting Oversight Board (PCAOB) audit standards Page 2 of 24 ASX:IMC Contents Directors’ Report 4 Auditor’s Independence Declaration 9 Consolidated Statement of Profit or Loss and Other Comprehensive Income 10 Consolidated Statement of Financial Position 11 Consolidated Statement of Changes in Equity 12 Consolidated Statement of Cash Flows 13 Notes to the Financial Statements 14 Directors’ Declaration 21 Independent Auditors’ Review Report 22 Company Directory 24 This Half Year Financial Report does not include all notes of the type normal included in an Annual Financial Report. Accordingly, this report is to be read in conjunction with the Annual Financial Report for the year ended 30 June 2016 and any public announcements made by Immuron Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001 and the ASX Listing Rules. Directors’ Report Your Directors present their report on Immuron Limited for the half year ended 31 December 2016. Directors The following persons were directors of Immuron Limited and its entity it controls during the whole of the halfyear and up to the date of this report, unless otherwise stated: Dr. Roger Aston Non-Executive Chairman Mr. Peter Anastasiou Mr. Stephen Anastasiou Deputy Executive Vice Chairman Non-Executive Director Mr. Daniel Pollock Non-Executive Director Key Highlights         Completion of the NASH Phase II Trial Recruitment – 120 Patients Randomized New NIH Grant, Studies, and NASH LM&A Activity Further Validate Potential of the NASH Program Travelan and Protectyn Continue to Grow – 42% Growth in Global Net Sales Immuron Signs Significant Development and Collaboration Agreements with US Army and US Navy Immuron Preparing for IMM-529 Phase 1/2 Clinical Trials in Clostridium difficile Partnership Formed with Australian Research Institutes on Autism Studies Oversubscribed $6.32M Rights Issue & $1.6M FY2016 R&D Refund Immuron files F1 with the US Securities and Exchange Commission ahead of NASDAQ listing Completion of the NASH Phase II Clinical Trial Recruitment – 120 Patients Randomized Changes to the clinical trial protocol has allowed Immuron to significantly accelerate the recruitment of the NASH Phase II clinical trial. We were pleased to announce on 20th February that the NASH Phase II clinical trial has now been fully recruited with 120 patients successfully randomized. The Company expects to have interim results in CY2Q 2017 and the top line results of the trial by the CY4Q2017. New NIH Grant, Studies, and NASH LM&A Activity Further Validate Potential of the NASH Program The potential of Immuron’s non-alcoholic steatohepatitis (NASH) candidate, IMM-124E, was further highlighted by: 1. 2. 3. the success in securing another NIH grant for a Phase II study in Pediatric NAFLD/NASH patients, the start of additional Mechanism of Action (MOA) studies of IMM-124E in NASH; and the continued robustness of the NASH LM&A (Licensing Merger & Acquisition) market. 1. Pediatric NAFLD/NASH Trial In August 2016, the US National Institutes of Health (NIH), America’s foremost medical research agency, awarded Atlanta’s prestigious Emory University with a grant to conduct a Phase II clinical study of IMM124E in pediatric NAFLD/NASH patients. Page 4 of 24 ASX:IMC Directors’ Report (Continued…) This is the second NIH grant supporting an Immuron IMM-124E study in fatty-liver disease, with the first study being the ongoing Phase II ASH (Alcoholic SteatoHepatitis) study conducted by the University of Virginia. The Pediatric NAFLD/NASH grant was classified in the top one percent of all NIH grant requests in one of the most fiercely contested funding environments in the world. The awarding of this grant highlights the importance that the NIH is placing on the unmet needs of pediatric patients in NASH and on IMM-124E’s Mechanism of Action (MOA) study, as well as the potential for another blockbuster indication for Immuron. Pediatric NASH is believed to affect between three (3) to five (5) percent of the US pediatric population. A landmark autopsy study also showed that of 742 youths aged 15 to 19 who had died in accidents, 17.3 percent had NAFLD (non-alcoholic fatty liver disease). With no approved treatments available, the pediatric NASH indication for IMM-124E is a $billion+ potential market opportunity for Immuron. 2. New IMM-124E MOA NASH Studies In early 2017, we initiated MOA studies which are designed to add to the growing body of evidence supporting the unique multifactorial MOA of IMM-124E in NASH. These studies are being conducted in partnership with SanyalBio and Duke University in the United States. We expect the results of these studies to be available by the end of CY2017, which will also coincide with the release of the top line results from the Company’s Phase II NASH clinical trial. These studies will help support our business development efforts. 3. LM&A NASH Market In October 2016, we saw the $US1.7 billion takeover proposal of Tobira Pharmaceuticals by Allergan. The acquisition was structured with a ~US$311M upfront payment, which was 3.5x Tobira’s market cap at the time of the announcement. This is despite the fact that Tobira’s Phase II did not reach its primary endpoint. The bid skyrocketed Tobira’s market capitalization from US$89.2 million to US$725 million in a day. On November 1, 2016, Allergan closed its acquisition of Tobira for US$538M which equate to a 500% premium over Tobira’s market cap at the time of the announcement of the acquisition. Travelan and Protectyn Sales Experience 42% Growth Travelan Net Sales for the first 6 months of FY2017 increased by 40% compared to the same period last year. This performance was predominantly driven by a 157% increase in United States Sales, a 4% increase in Australian sales. In the United States, the strong relationship we have developed with Passport Health Corporate is powering our sales growth. Our partnership with Passport Health Corporate meant that Travelan has been available at more than 80 clinics throughout the US and a successful promotional campaign during the August 2016 – December 2016 period resulted in several thousand packets of Travelan being sold to Passport Health customers. The key behind this success was the training of Passport Health’s nurses who carried Travelan’s differentiation message to their customers. This performance was particularly impressive given that this was the non-travel season. Page 5 of 24 ASX:IMC Directors’ Report (Continued…) Based on the success of this promotion, Passport Health Corporate and Immuron will again combine to run another promotional campaign for the March 2017 – August 2017 peak US travel period. Immuron will also seek to partner with several Passport Health independent clinics to drive our performance further. Immuron also entered into an agreement with Medique Products, one of the largest distributors of medical supplies in the US, including OTCs, for workplace health. Medique targets occupational health nurses, industrial supply, occupational health doctors, corporate safety directors, correctional health, school health and sports medicine. Medique has over 40 years’ experience distributing medical and OTCS through a network of more than 1,000 business partners across the US. In June 2016, Magellan’s added Travelan to it monthly US travel products catalogue and placed its first purchase order. With 1.5 million subscribers, mostly affluent international travelers, the profile of this distributor is ideal for Travelan. Magellan is also part of the Potpourri Group, one of North America’s largest multi-brand, multichannel retailers. In Australia, the first 6 months of the 2017 financial year continued to maintain the increasing trend in sales growth we recorded last year. We have planned additional trade and promotional activities in the second half of this financial year to further accelerate our growth in Australia. In Canada, Immuron is currently in negotiation with Paladin to terminate the current marketing and distribution agreement with a goal of taking back the regulatory, marketing and distribution rights for Canada and other territories, including Central and Latin America. Immuron Preparing for IMM-529 Phase 1/2 Clinical Trials in Clostridium difficile Following IMM-529’s exciting results in pre-clinical studies, Immuron has been preparing for the start of the safety/efficacy clinical trials in humans. Immuron is currently finalizing the manufacturing of IMM-529’s clinical supplies and has finalized a protocol for 60 patients that will be conducted at a major center. We estimate that the trial should commence in CY2Q2017, and will take approximately 12 months to recruit. We are excited by the progress we are making and we look forward to continue pushing forward the development IMM-529 in Clostrium difficile infections (CDI), a blockbuster orphan indication that kills nearly 30,000 people each year in the US and is a growing problem around the world. Immuron Signs Significant Development and Collaboration Agreements with US Army and US Navy The US military has executed two research and development collaboration agreements with Immuron which further highlights the growing respect the US military has for Immuron’s anti-infective platform. The first agreement, signed in June 2016, is for the development of a Shigella vaccine with the Walter Reed Army Institute of Research (WRAIR). Shigella bacteria causes Shigellosis, or bacillary dysentery, affecting around 165 million people a year and causing a million deaths annually, mostly children in developing countries. Shigella currently has no approved vaccines. Now in its 125th year, WRAIR is the oldest, largest, and most diverse military biomedical research institute in the US Department of Defense. This research program will explore the anti-Shigella activity of antibodies in Travelan, and look to create a Shigella-specific bovine immunoglobulin product using WRAIR antigens utilizing Immuron’s oral immunotherapy platform. Page 6 of 24 ASX:IMC Directors’ Report (Continued…) The second agreement was executed in August 2016 with the US Navy’s Navy Medical Research Center. This research program will test Travelan in cell lines of Campylobacter and Enterotoxigenic Escherichia coli (ETEC). Campylobacter and ETEC are the bacteria behind most cases of traveler’s diarrhea around the world. Conservative estimates claim ETEC alone causes approximately 157,000 deaths a year, mainly in children. No vaccines exist to counter either strain of bacteria. If we are successful, this could potentially open a new and lucrative opportunity for Immuron with resulting products produced to meet both military and civilian needs. Partnership Formed with Australian Research Institutes on Autism Studies In July 2016, Immuron announced a cutting edge collaboration partnership with three leading Australian research institutes. The research will explore connections between gastrointestinal (GI) microbiota and people with Autism Spectrum Disorder (ASD). The partnering research institutes include the University of Melbourne, La Trobe University, and the Murdoch Children’s Research Institute. This research program will initially concentrate on microbiota in mouse models, which is similar to humans, but will allow for more control over environmental factors which can be difficult in human testing. Data from the study will be an industry first and could eventually lead to human studies. These would support the increasingly convincing research that links the microbiome to certain Central Nervous System (CNS) conditions. Oversubscribed $6.32M Rights Issue & $1.6M FY2016 R&D Refund Immuron’s July 2016 Rights Issue closed in Sept 2016, and was oversubscribed raising $6.32 million (before costs). As a result, the Company was able to inform shareholders that it would repay all future Convertible Note repayments to US Investment Fund Sea Otter in cash, benefiting shareholders through no further dilution of their holdings via share issue repayments. Immuron also received a $1.6 million cash refund from its $3.6m of eligible research and development (R&D) expenditure in financial year 2016 under the Australian Federal Government’s Research and Development Income Tax Concession incentive program. Immuron Files F-1 with the US Securities and Exchange Commission ahead of NASDAQ Listing In December 2016, the Company filed its Registration Statement Form F-1 with the US Securities and Exchange Commission (SEC). The registration is the first step towards an initial public offering (IPO) in the United States of Immuron’s American Depository Shares (ADS) on the US NASDAQ exchange. Following the endorsement of shareholders in Nov 2016 for the US NASDAQ listing, the Company has continued to progress the listing as quickly as practicable. In February 2017, the Company submitted two rounds of responses to queries it has received from the SEC. The Company will continue to work with the SEC to satisfy all requests for clarification to ensure the Form F1 is finalized as soon as possible. Page 7 of 24 ASX:IMC Directors’ Report (Continued…) On the horizon Looking forward for the remainder of fiscal year 2017, there are a number significant milestones on the horizon:       Completion of Registration with the US SEC; US listing on NASDAQ via IPO and associated capital raising; Progression of NASH, Pediatric NAFLD/NASH and ASH programs; Top Line results of the NASH Phase II clinical trial interim analysis; Commencement of the Phase I/II C. difficile clinical trial program; and Acceleration of the colitis pre-clinical program; All of these developments underpin the careful planning and strategic thinking that continues to guide Immuron’s advance towards global significance as a pharmaceutical force, and a NASH-centric LM&A transaction post NASH Phase II results to ensuring the Company is maximizing the potential value from its portfolio platform for shareholders. For and on behalf of the Company Thomas Liquard Chief Executive Officer Immuron Limited Dated: This the 28th day of February 2017 Page 8 of 24 ASX:IMC Auditors’ Independence Declaration Page 9 of 24 ASX:IMC Consolidated Statement of Profit or Loss and Other Comprehensive Income For the Half Year Ended 31 December 2016 31 December 2016 Notes 31 December 2015 (Restated) $ $ Revenue Total Operating Revenue 703,099 497,220 Total Operating Revenue 703,099 497,220 Cost of Goods Sold (223,394) (153,640) Gross Profit 479,705 343,580 Direct Selling Costs Sales and Marketing Costs (93,520) (242,150) Freight Costs (62,590) (61,299) Total Gross Revenue 323,595 40,131 Other Income 816,932 1,476,906 Expenses Consulting, Employee and Director (907,390) (1,113,214) (790,103) (708,625) Depreciation (1,975) (1,944) Finance Fee Costs (13,183) - Impairment of Inventory (135,170) (169) Marketing and Promotion (471,735) (12,233) Research and Development (2,117,867) (1,839,990) Travel and Entertainment (112,453) (195,605) (3,409,349) (2,354,743) - - Loss after income tax for the period (3,409,349) (2,354,743) Other comprehensive income: Items that will not be reclassified to profit or loss Exchange differences on translating foreign operations Total Comprehensive Loss for the period (41,425) (3,450,774) (4,781) (2,359,524) (3.318) (3.120) Corporate Administration Loss Before Income Tax Income Tax Expense Basic/Diluted Loss per Share (cents per share) 7 The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes. Page 10 of 24 ASX:IMC Consolidated Statement of Financial Position For the Half Year Ended 31 December 2016 31 December 2016 Notes $ 30 June 2016 (Restated) $ ASSETS Current Assets Cash and cash equivalents 3,103,683 2,290,639 Trade and other receivables 900,347 4,387,772 1,751,871 2,056,067 81,933 74,943 5,837,834 8,809,421 17,967 18,063 17,967 18,063 5,855,801 8,827,484 1,624,621 1,986,407 Inventories Other Total Current Assets Non-Current Assets Property, plant and equipment Total Non-Current Assets TOTAL ASSETS LIABILITIES Current liabilities Trade and other payables Borrowings - 772,397 678,000 1,128,117 Total Current Liabilities 2,302,621 3,886,921 TOTAL LIABILITIES 2,302,621 3,886,921 NET ASSETS 3,553,180 4,940,563 47,485,700 45,633,354 2,243,061 2,128,566 (46,175,581) (42,821,357) 3,553,180 4,940,563 Other financial liabilities EQUITY Issued capital 5 Reserves Retained earnings TOTAL EQUITY The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes. Page 11 of 24 ASX:IMC Consolidated Statement of Changes in Equity For the Half Year Ended 31 December 2016 Balance as at 30 June 2015 Share Capital Option Reserves $ $ Foreign Currency Translation Reserve $ Accumulated Losses $ Total $ 40,335,347 560,646 (12,581) (37,542,572) 3,340,840 Loss after income tax expense for the year Other comprehensive loss for the period Total comprehensive loss for the period - - (4,781) (4,781) (2,359,524) (2,359,524) (2,359,524) (4,781) (2,364,305) Employee and consultant share options Lapse or exercise of share options Transactions with owners in their capacity as owners Shares issued, net of costs Balance as at 31 December 2015 (Restated) - 537,309 (58,615) - - 537,309 (58,615) 480,879 40,816,226 1,039,340 (17,362) (39,902,096) 480,879 1,936,108 Balance as at 30 June 2016 (Restated) 45,633,354 2,132,302 (3,736) (42,821,357) 4,940,563 - - (41,425) (41,425) (3,409,349) (3,409,349) (3,409,349) (41,425) (3,450,774) 71,875 282,920 (127,000) - 55,125 282,920 - 1,780,471 47,485,700 2,288,222 (45,161) (46,175,581) 1,780,471 3,553,180 Loss after income tax expense for the year Other comprehensive loss for the period Total comprehensive loss for the period Options issued/expensed Lapse or exercise of share options Transactions with owners in their capacity as owners Shares issued, net of costs Balance as at 31 December 2016 The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes. Page 12 of 24 ASX:IMC Consolidated Statement of Cash Flows For the Half Year Ended 31 December 2016 31 December 2016 $ 31 December 2015 $ 664,900 613,528 (4,423,797) (4,074,918) 6,791 7,143 Interest and other costs of finance paid (54,555) - Other - R&D Tax Concession Refund 1,590,043 - Net Cash Flows Used In Operating Activities (2,216,618) (3,454,247) Payment for purchases of plant and equipment (1,879) (2,441) Net Cash Flows Used In Investing Activities (1,879) (2,441) Proceeds from issues of securities 4,423,234 342,223 Capital raising costs (120,285) (7,458) - 1,000,000 (1,271,555) - 3,031,394 1,334,765 812,897 (2,121,923) 2,290,639 3,116,074 147 - 3,103,683 994,151 Note Cash flows Related to Operating Activities Receipts from customers Payments to suppliers and employees Interest received Cash Flows Related to Investing Activities Cash Flows Related to Financing Activities Proceeds from borrowings Repayment of borrowings 8 Net Cash Flows Used In Financing Activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the period Effects of exchange rate changes on cash and cash equivalents Cash and Cash Equivalents at the End of the Period The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes. Page 13 of 24 ASX:IMC Notes to the Financial Statements Note 1. Basis of Preparation (a) Basis of Preparation The general purpose financial report for the interim half year reporting period ended 31 December 2016 has been prepared in accordance with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001. This half year financial report does not include all notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 30 June 2016 and any public announcements made by Immuron Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001 and the ASX Listing Rules. Compliance with AASB 134 "Interim Financial Report" ensures that the financial statements and notes of the entity comply with International Financial Reporting Standards equivalent IAS 34 "Interim Financial Reporting." (b) Accounting Policies All accounting policies adopted are consistent with the most recent Annual Financial Report for the year ended 30 June 2016. The consolidated entity has adopted all of the new, revised or amending Accounting Standards and Interpretation issued by the Australian Accounting Standards Board (‘AASB’) that are mandatory for the current reporting period. The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the consolidated entity. (c) Fair value measurement Due to the nature of the Group’s operating profile, the Directors and management do not consider that the fair values of the Group’s financial assets and liabilities are materially different from their carrying amounts at 31 December 2016. (d) Going Concern At 31 Dec 2016 the Company’s cash and cash equivalents amounted to $3,103,683 (2015: $994,151). For the half year ended 31 December 2016 the Company experienced a net cash outflow of $2,216,618 (2015: $3,454,247) from operating activities. This included $2,117,867 of expenditures associated with research, development and commercialisation programs predominantly surrounding the Non- Alcoholic Steatohepatitis (NASH) Clinical Trial. The Company has achieved a number of key successes in the past 6 months including:  successfully completion of an oversubscribed $6.32M Right Issue Capital Raising (before costs);  Repayment of convertible note in cash so as to remove downward pressure on share price from the selloff of conversion shares;  completion and Filing of the Form F1 with SEC in preparation of a US NASDAQ listing;  commencement of HIN fully-funded IMM-124E Pediatric Non-Alcoholic Fatty Liver Disease (NAFLD) Phase II trial; and  completion of patient recruitment in the Company’s (NASH) IMM-124E Phase II clinical trial. Whilst the Company is projecting further net losses and a net cash outflow from operations for the remainder of the 2017 financial year, the Board is confident of strong support from US investors ahead of the highly anticipated US NASDAQ listing. Page 14 of 24 ASX:IMC Notes to the Financial Statements (Continued…) The Directors have considered feedback from advisors as well as the considerable recent US market activity surrounding NASH clinical assets, which when combined with the forthcoming NASH clinical trial results pending for release in Q4 of 2017, the Company is very well positioned to ensure a successful fund raising can be achieved. In the unlikely event that the Company is not successful with the US NASDAQ IPO raise, the Company may seek to raise further funds through more conventional means via the ASX. The likelihood of the Company not being able to raise further funding to secure it future as a going concern is extremely minimal, but should this occur the Company would amend its current business plans and targets in the interim. Accordingly, the Directors have prepared the financial statements on a going concern basis. As such, the financial statements do not include any adjustments as to the recoverability and classification of recorded asset amounts or to the amounts and classification of liabilities that might be necessary should the entity not continue as a going concern. Note 2. Dividends The company has not declared any dividends in the period ended 31 December 2016. (2015: $Nil) Note 3. Segment Information The entity has identified its operating segments based on the internal reports that are reviewed and used by the executive management team in assessing performance and determining the allocation of resources. The executive management team considers the business from both a product and a geographic perspective and has identified three reportable segments. Segments Research and Development (R&D) – Income and expenses directly attributable to the company’s research and development projects performed in Australia and Israel. HyperImmune Products – Income and expenses directly attributable to Travelan activities which occur in Australia, New Zealand and United States. Corporate – Other items of income and expenses not directly attributable to R&D or HyperImmune Products segment are disclosed as corporate costs. Corporate activities primarily occur within Australia. This segment includes interest expenses from financing activities and depreciation. The Board assesses the performance of the operating segments at a number of operating levels including adjusted EBITDA. Page 15 of 24 ASX:IMC Notes to the Financial Statements (Continued…) Research & Development $ HyperImmune Products $ - 703,099 - 703,099 779,826 - - 779,826 - - 6,791 6,791 Other revenue 25,007 - 5,308 30,315 Total Segment Revenues 804,833 703,099 12,099 1,520,031 Segment Expenses (2,117,867) (379,504) (2,432,009) (4,929,380) Total Segment Expenses (2,117,867) (379,504) (2,432,009) (4,929,380) - - - - (1,313,034) 323,595 (2,419,910) (3,409,349) Assets Segment assets 702,623 1,949,595 3,203,583 5,855,801 Total Assets 702,623 1,949,595 3,203,583 5,855,801 (708,474) (131,630) (1,462,517) (2,302,621) (708,474) (131,630) (1,462,517) (2,302,621) Research & Development $ HyperImmune Products $ - 497,220 - 497,220 1,469,763 - - 1,469,763 - - 7,143 7,143 Total Segment Revenues 1,469,763 497,220 7,143 1,974,126 Segment Expenses Segment Expenses (1,839,990) (457,089) (2,031,790) (4,328,869) Total Segment Expenses (Restated) (1,839,990) (457,089) (2,031,790) (4,328,869) Income Tax Expenses - - - - Net Result (Restated) (370,227) 40,131 (2,024,647) (2,354,743) Assets Segment assets 1,469,763 1,597,215 1,078,817 4,145,795 Total Assets 1,469,763 1,597,215 1,078,817 4,145,795 Liabilities Segment liabilities (642,521) (52,486) (1,509,901) (2,204,908) Total Liabilities (642,521) (52,486) (1,509,901) (2,204,908) 31 December 2016 Segment Revenue Revenue from external customers R&D tax concession refund Interest revenue Corporate Total $ $ Segment Expenses Income Tax Expenses Net Result Liabilities Segment liabilities Total Liabilities 31 December 2015 Segment Revenue Revenue from external customers R&D tax concession refund Interest revenue Page 16 of 24 Corporate Total $ $ ASX:IMC Notes to the Financial Statements (Continued…) Note 4. Contingent Liabilities and Assets There has been no change in contingent liabilities and assets since the last annual reporting date. Note 5. Contributed Equity 31 December 2016 No. $ 30 June 2016 No. $ Fully Paid Ordinary Shares Balance at beginning of year 80,099,646 45,633,354 74,964,232 40,335,347 Shares issued during the year 25,541,771 1,841,951 5,135,414 1,721,789 Shares to be issued - - - 4,511,378 Movement to Retained Earnings - 71,875 - - Treasury Shares - - - (800,000) Transactions costs - (61,480) - (135,160) 105,641,417 47,485,700 80,099,646 45,633,354 Total Contributed Equity During the Half Year ended 31 December 2016 the Company issued the following Ordinary Shares: Date Details No. 7 Jul 2016 2 Dec 2016 Right Issue Shares under ESOP - for 6 month service (vesting monthly) Total 2016 Movement Issue Price $ Total Value $ 0.072 0.123 1,811,096 30,855 25,289,894 251,877 25,541,771 1,841,951 Note 6. Option Reserves 31 December 2016 No. $ No. $ Options over Fully Paid Ordinary Shares Balance at beginning of year 8,937,629 2,132,302 6,188,676 560,646 Options issued during the year 26,489,894 70,520 1,425,532 285,600 Options exercised during the year - - (1,060,166) (71,875) Expense of vested options - 212,400 6,0