What changed in this filing

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Item 9A. Controls and Procedures

2023-03-15 compared with 2022-03-30 · 58 added, 62 removed, 124 unchanged (49% of the section changed)

7 unchanged sentences

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rule 13a-15(f).

The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles U.S GAAP.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

2 unchanged sentences

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

During the year ended December 31, 2021, our management, with oversight from our audit committee, implemented the following remediation steps to address and mitigate all but one of the underlying deficiencies which gave rise to the previously disclosed material weaknesses and to improve our internal control over financial reporting.

We anticipate the remaining weakness regarding segregation of duties in some areas of finance to be resolved in 2022.

Remediation steps undertaken include:

Oversight in Information Technologies

ensured that third party support and back up is available as cover for our information technology manager;

ensured that appropriate finance approvals are taken before adding users or access for financial systems and applications;

implemented a quarterly user access control review process across finance and information technology systems.

As a result of these actions, management has concluded that this particular deficiency has been remedied.

Monitoring of Review Controls with Respect to Accounting for Complex Transactions

reallocated responsibilities across the finance organization to ensure that the appropriate level of knowledge and experience is applied based on complexity of tasks being undertaken;

further embedded the use of Certent, an equity management platform, to help with control and reporting of equity awards;

implemented additional review procedures;

in the event we encounter or anticipate any new and particularly complex transaction we will engage advisors from our wide professional network.

As a result of these actions, management has concluded that this particular deficiency has been remedied.

Segregation of Duties in Some Areas of Finance

hired an additional full-time Business Controller in Belgium with an appropriate level of experience;

hired an experienced financial planning and analysis manager to implement forecasting and budgeting processes;

changed organizational reporting lines and reallocated certain responsibilities to improve segregation of duties;

During the year ended December 31, 2022, our management, with oversight from our audit committee, implemented the following remediation steps to address and mitigate the underlying deficiencies which gave rise to the material weaknesses and to improve our internal control over financial reporting:

hired specialists in human resources and information technology to recommend and implement relevant policies and processes that will strengthen the control environment;

changed organizational reporting lines and reallocated certain responsibilities to improve segregation of duties around payroll;

engaged additional resources to help us assess, document, design and implement control activities related to internal control over financial reporting;

implemented additional review procedures at each month end close.

During 2022, we intend to take additional measures around certain processes we have identified which we believe once implemented and in conjunction with the completed actions above will mitigate and remedy this weakness.

We also intend to take additional steps to further strengthen the control environment.

During 2023, we intend to take additional measures to strengthen certain processes we have identified which we believe once implemented in conjunction with the completed actions above will mitigate and remedy this weakness.

We also intend to take additional steps to continue to strengthen the control environment.

Such measures include but may not be limited to:

recruitment of a specialist in Human Resources to recommend and implement relevant policies and processes that will strengthen the control environment;

further strengthening our internal processes and reviews, including formal documentation thereof;

hiring additional finance resources;

strengthening our internal processes and reviews, including formal documentation thereof;

preparation of risk-control matrices to identify key risks and develop and document policies to mitigate those risks.

engaging additional resources if necessary to help us assess, document, design and implement control activities related to internal control over financial reporting.

As we continue to evaluate and test the remediation plan outlined above, we may also identify additional measures to address the material weaknesses or modify certain of the remediation procedures described above.

We also may implement additional changes to our internal control over financial reporting as may be appropriate in the course of remediating the material weakness.

We may also implement additional changes to our internal control over financial reporting as may be appropriate in the course of remediating the material weakness.

Management, with the oversight of our audit committee, will continue to take steps necessary to remedy the material weakness to reinforce the overall design and capability of our control environment.

In its assessment of the effectiveness of internal control over financial reporting as of December 31, 2021, the Company determined that there were control deficiencies in the segregation of duties in some areas of Finance that constituted a material weakness.

Accordingly, the Company concluded that these control deficiencies resulted in a possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

As a result, management has concluded that the Company did not maintain effective internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control—Integrated Framework issued by COSO.

Changes in Internal Control over Financial Reporting

7 unchanged sentences

OTHER INFORMATION

Effective March 1, 2023, Singapore Volition entered into an employment agreement with Cameron Reynolds, the Company’s Chief Executive Officer (the “Reynolds Employment Agreement”), which supersedes and replaces in its entirety the Consulting Services Agreement between Singapore Volition and PB Commodities Pte.

Ltd., a Singapore corporation (“PB Commodities”), dated December 1, 2020, pursuant to which PB Commodities made Mr.

Reynolds’ services available to the Company.

The Reynolds Employment Agreement continues until terminated by either party providing not less than six months’ prior notice.

In exchange for his services, Mr.

Reynolds shall receive, among other things, (i) an annual base salary of $450,300 from Singapore Volition, paid in equal monthly installments, and (ii) a lump sum severance payment if terminated by Singapore Volition without cause equal to the salary that he would have received between the date of termination and the completion of a six-month notice period.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

9 unchanged sentences

EXHIBITS, FINANCIAL STATEMENT SCHEDULES

The following documents are filed as part of this Report:

(a) The following documents are filed as part of this Report:

Financial Statements.

4 unchanged sentences

Exhibit Description

Filed Herewith

Share Purchase Agreement, by and between Singapore Volition and ValiRX, dated September 22, 2010.

9 unchanged sentences

Exhibit Description

Filed Herewith

2011 Equity Incentive Plan dated November 17, 2011.

1 unchanged sentence

Form Stock Award Agreement for Restricted Stock under the 2011 Equity Incentive Plan.

2015 Stock Incentive Plan, as amended March 31, 2021.

2015 Stock Incentive Plan, as amended.

Form of Notice of Stock Option Grant and Stock Option Agreement under the 2015 Stock Incentive Plan.

10 unchanged sentences

Exhibit Description

Filed Herewith

Employment Agreement, by and between Volition Diagnostics UK and Martin Faulkes, dated March 7, 2017.

Unsecured Credit Agreement dated September 20, 2017, by and among VolitionRx, Belgian Volition and SOFINEX (English translation of French original).

Clinical Study Agreement dated July 17, 2017, by and between Volition America and the Regents of the University of Michigan.

Amendment #1 to Clinical Study Agreement, dated February 17, 2020, by and between Volition America, Inc.

and the Regents of the University of Michigan.

Unsecured Credit Agreement, by and among VolitionRx, Belgian Volition and SOFINEX (English translation of French original), dated September 20, 2017.

Clinical Study Agreement, by and between Volition America and the Regents of the University of Michigan, dated July 17, 2017.

Amendment #1 to Clinical Study Agreement, by and between Volition America, Inc.

and the Regents of the University of Michigan, dated February 17, 2020.

Warrant to Purchase Common Stock, by and between VolitionRx and Jason Terrell MD, dated March 20, 2013;

1 unchanged sentence

and Second Amendment to Warrant Agreement, dated July 1, 2019.

Permanent Employment Contract by and between Belgian Volition and Gaetan Michel, dated October 1, 2020.

Equity Distribution Agreement, dated November 12, 2020, by and among VolitionRx, Oppenheimer & Co.

and Cantor Fitzgerald & Co.

Equity Distribution Agreement, by and among VolitionRx, Oppenheimer & Co.

and Cantor Fitzgerald & Co., dated November 12, 2020.

Consulting Services Agreement, by and between Singapore Volition and PB Commodities Pte.

3 unchanged sentences

Limited Employment Agreement, by and between Singapore Volition and Terig Hughes, dated January 27, 2021 and effective February 1, 2021, including the form of Common Stock Warrant attached as Schedule 2.

Incorporated by Reference

Exhibit Description

Volition America, Inc.

Employment Agreement, by and between Volition America and Gael Forterre, dated February 1, 2021.

Consulting Services Agreement between Volition Germany and 3F Management SPRL (Gaetan Michel), dated January 29, 2021;

First Amendment between Volition Germany and 3F Management SPRL, dated February 1, 2021;

Second Amendment between Volition Germany and 3F Management SPRL, dated May 1, 2021.

Volition Veterinary Diagnostics Development, LLC Employment Agreement Chief Executive Officer, between Volition Veterinary Diagnostics Development and Salvatore Thomas Butera, dated March 25, 2021.

Equity Distribution Agreement, dated September 24, 2021, by and among VolitionRx, Oppenheimer & Co.

and Cantor Fitzgerald & Co.

Employment Agreement between Volition America and Gaetan Michel, dated September 15, 2021.

Consulting Services Agreement between Volition Global and 3F Management SPRL (Gaetan Michel), dated September 15, 2021.

Employment Agreement between Volition Diagnostics and Nick Plummer, dated August 23, 2021.

Incorporated by Reference

Exhibit Description

Filed Herewith

Volition Veterinary Diagnostics Development, LLC Employment Agreement Chief Executive Officer, by and between Volition Veterinary Diagnostics Development and Salvatore Thomas Butera, dated March 25, 2021.

Equity Distribution Agreement, by and among VolitionRx, Oppenheimer & Co.

and Cantor Fitzgerald & Co., dated September 24, 2021.

Employment Agreement, by and between Volition America and Gaetan Michel, dated September 15, 2021.

Consulting Services Agreement, by and between Volition Global and 3F Management SPRL (Gaetan Michel), dated September 15, 2021.

Employment Agreement, by and between Volition Diagnostics and Nick Plummer, dated August 23, 2021.

License and Supply Agreement between Belgian Volition and Heska Corporation, dated March 28, 2022.

Equity Distribution Agreement, dated May 20, 2022, by and between VolitionRx Limited and Jefferies LLC.

Underwriting Agreement, dated July 29, 2022, by and between VolitionRx Limited and Newbridge Securities Corporation.

Underwriting Agreement, dated February 17, 2023, by and between VolitionRx Limited and Newbridge Securities Corporation.

Singapore Volition Pte.

Limited Employment Agreement – Group Chief Executive Officer, dated March 13, 2023, by and between Singapore Volition and Cameron Reynolds.

List of Subsidiaries.

5 unchanged sentences

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Incorporated by Reference

Exhibit Description

XBRL Instance Document

XBRL Taxonomy Extension Schema Document.

XBRL Taxonomy Extension Calculation Linkbase Document.

XBRL Taxonomy Extension Definition Linkbase Document.

XBRL Taxonomy Extension Label Linkbase Document.

XBRL Taxonomy Extension Presentation Linkbase Document.

Inline XBRL Instance Document

Inline XBRL Taxonomy Extension Schema Document.

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

Inline XBRL Taxonomy Extension Definition Linkbase Document.

Inline XBRL Taxonomy Extension Label Linkbase Document.

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

16 unchanged sentences

President, Chief Executive Officer and Director

March 30, 2022

Cameron Reynolds

(Principal Executive Officer)

March 15, 2023

/s/ Terig Hughes

Chief Financial Officer and Treasurer

March 30, 2022

(Principal Financial and Accounting Officer)

Martin Faulkes

March 15, 2023

Martin Faulkes

March 15, 2023

/s/ Guy Innes

2 unchanged sentences

Phillip Barnes

March 30, 2022

Phillip Barnes

Edward Futcher

March 15, 2023

Edward Futcher

March 15, 2023

/s/ Kim Nguyen

1 unchanged sentence

/s/ Richard Brudnick

March 30, 2022

Richard Brudnick

March 15, 2023

/s/ Mickie Henshall

Mickie Henshall

March 15, 2023

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures