Notes on accounts - hmmmmm - anyone smell anything - fire???...

Notes on accounts - hmmmmm - anyone smell anything - fire??? Delay till March 17??

Appendix 4C
Quarterly report for entities
admitted on the basis of commitments
+ See chapter 19 for defined terms.
Appendix 4C Page 4 17/12/2010
Item 1.1: The YTD receipts represent part of an order (US$899,000) for modification of the Pilot Plant for Reliance Group. US$780,695 remains to be invoiced for this order along with approximately a further US$600,000 related retentions and further engineering and technical services. A payment of US$132,000 was received in January 2017 for completion of part of the technical services. Installation and commissioning of the Reliance Pilot Plant in Jamnagar commenced in January 2017.
Item 1.2: As a result of elimination in the consolidation of the accounts of Algae.Tec Limited and Algae Energy Inc., allocated research and development costs from Algae Energy Inc. appear within their specific payment categories (a, b and e) rather than the research and development category (c).
Item 1.2: Included in the YTD Other Working Capital payments (e) is a payment to Deloitte for their fees in the administration of the R & D tax allowances and based upon the refund received.
Item 1.2: Substantial upgrades to the test plant in Cumming, Georgia have been included in YTD Other Working Capital payments (e). These upgrades to the plant were expected to commence generating income during November 2016 but due to a fire (which is covered by Insurance) this has been delayed until March 2017 whilst repairs are undertaken.
Item 1.2: The expenditure in Other Working Capital for the quarter was significantly reduced given that the Deloitte Fees previously mentioned are only payable annually (first quarter) and that the plant upgrades have been completed.
Item 1.7: This represents the R & D tax refund received for the 2016 financial year.
Item 1.17: This includes funding by Macquarie Bank in relation to Research and Development expenditure for the 2016 financial year of $169,256 which was fully repaid in September .
Item 1.17: A new R & D funding facility (replacing Macquarie Bank) was established with ITF in September 2016 and as at 31 December 2016 $900,000 had been drawn down against the $1,800,000 facility established. The balance of the facility will be drawn down over the next 2 quarters
Item 1.17: A convertible note of $250,000 was issued in January 2017. $125,000 was received in December 2016 (this quarter) and the remainder in January 2017.
Item 1.18: YTD includes the full repayment of the 2016 Macquarie facility of $1,900,000 being drawn funds against 2016 R & D Expenditure
Item 1.24: Payments to Directors consist of Directors’ salaries and the Directors’ fees paid during the quarter, including superannuation




Appendix 4C
Quarterly report for entities
admitted on the basis of commitments
+ See chapter 19 for defined terms.
Appendix 4C Page 6 17/12/2010
An amount of $2,427,928 was received by Algae.Tec Limited in September 2016 from the Australian Taxation Office in relation to the eligible research and development expenditure for the financial year ended 30 June 2016. This was used to repay the Macquarie facility provided for the year of $1,900,000.
A new R & D funding facility was established in September 2016 (replacing Macquarie Bank) in the amount of $1,800,000 and the first of these funds were drawn down in October 2016 ($300,000) with a further $600,000 drawn down during this quarter. The balance of $900,000 will be drawn down over the next 2 quarters
Work on the RIHL Pilot Plant is continuing and a further US$132,000 was invoiced and paid in January 2017 for the part completion of technical services. Personnel from the USA facility are now on site in Jamnagar for the commissioning of the project with operational testing expected within the next 6 months. Further billings in respect of outstanding purchase orders (US$1,012,800) for equipment, commissioning and technical services are anticipated during the coming year.
A pilot nutraceutical production plant was completed in Atlanta and became operational during the last quarter. Further modifications were undertaken in this quarter and, due to a small fire, sales of product are now expected to occur within the next quarter.
As per the announcement on 8th July 2016, a convertible note in the value of US$350,000 was issued and the funds received during the quarter. A further US$150,000 is available during the next quarter subject to meeting equity criteria.
Following the signing of a supply agreement with Gencor in relation to the supply of nutraceutical from the test plant in the USA, Gencor have also invested US$1,000,000 (received in July 2016) and paid for the additional upgrades for the further development of the US based test plant referred to earlier.
On 25 January 2017 Algae.Tec announced the signing of agreements with a sophisticated international investor to explore the application of Company licenced technology for the Middle East region. US$166,667 has been received (and convertible notes issued in response) with a further US$333,333 potentially to be received during the next 2 months and a further US$1,000,000 subject to the satisfactory completion of certain conditions precedent. Should the conditions precedent be met, the parties intend to enter into a joint venture regarding development of a facility in the Middle East region to focus on algae for nutraceuticals.