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Since inception, the Company's activities have been primarily focused on the development of its transgenic technologies for the production of recombinant proteins and the functional characterization of the biological properties of proteins for product applications. Up until March 2005, Nexia continued to focus on development of Protexia® (recombinant human butyrylcholinesterase), a bioscavenger, and to a lesser extent applications for BioSteelTM, a biopolymer. Biotech Operations PharmAthene In September 2006, PharmAthene Inc. announced that it was awarded a $213 million U.S. Department of Defence contract for advanced research. Unfortunately, the merger agreement with SIGA Technologies Inc. was terminated in October 2006. PharmAthene investment is being held in anticipation of a liquidity event. Nexia continues to monitor this investment closely with a view to returning maximum value to Nexia shareholders. Arrangement Agreement On January 9, 2006, Nexia announced that it had completed its assessment of corporate assets and that Nexia's management had been instructed to proceed with a reorganization strategy to enhance shareholder value. The conceptual transaction structure was intended to preserve the value of Nexia's PharmAthene and BioSteel® assets and, at the same time, allow Nexia's shareholders to participate in the oil and gas industry. Nexia then proceeded to solicit and review a number of proposals from participants in the oil and gas industry. In February 2006, Nexia initiated arm's length discussions with a group of individuals who were proposing the creation of Enseco Energy Services Corp. ("Enseco"), a company that was being created to participate in the oil and gas services industry. These discussions resulted in the signing of a confidential and conditional letter of intent dated February 27, 2006. All parties then proceeded to conduct an extensive due diligence review and engaged in further discussions and negotiations. On March 30, 2006, Nexia announced that Nexia, Enseco, 6539718 Canada Inc. ("New Nexia" or Nexia Biotechnologies Ltd.) and Enseco Management Corp. had entered into a definitive agreement to reorganize and recapitalize Nexia's business (the "Arrangement Agreement"). As a result of the anticipated transactions under the Arrangement Agreement, Nexia shareholders will be provided with a 9.6% interest in Enseco, an oil and gas service company, while maintaining a non-diluted interest in Nexia's biotech assets through New Nexia, a newly formed public company. New Nexia will have approximately 24,032,539 common shares outstanding, 97.5% of which will be held by former Nexia shareholders. New Nexia will continue to pursue business and investment opportunities and continue the development of its BioSteel® assets and the management of its investment in PharmAthene. Effective August 29, 2006, the Nexia Board approved the amended and restated Arrangement Agreement, the Information Circular and Nexia's application to the Court for the Interim Order and reconfirmed its recommendation to Nexia Common Shareholders respecting the Arrangement. An information circular regarding the Arrangement Agreement was mailed to the shareholders in September 2006 and is available on www.sedar.com. A shareholder meeting was held on October 16, 2006, which approved the transactions contemplated under the plan of arrangement described above. Between October 16 and October 23, the required legal, regulatory and securities approvals were obtained and the plan of arrangement was closed on October 23, 2006. On October 24, 2006, 6539718 Canada Inc. changed its name to Nexia Biotechnologies Ltd. On Janauary 16, 2007, the CNQ (www.cnq.ca) approved Nexia's listing. The shares are expected to trade under the symbol NXBL-Z. |
