2024-05-10T10:38:37-05:00 2023-06-30 042571780 AAFCPAS INC 50 WASHINGTON STREET WESTBOROUGH MA 01581 990 2022-07-01 134269601 VOICE HEALTH INSTITUTE VOIC 7813561603 ONE BOWDOIN SQUARE 11FL BOSTON MA 02114 JOHN LICHTENSTEIN PRESIDENT 7813561603 2024-04-30 1 JOHN LICHTENSTEIN XXX-XX-XXXX 1 JOHN BUCKLEY CPA P00830631 5083669100 2024-04-30 2 AAL1 IAL1 2022 2023-04-26 12:10:37Z JOHN LICHTENSTEIN ONE BOWDOIN SQUARE 11FL BOSTON MA 02114 205921 0 X WWW.VOICEHEALTH.ORG X 2003 RI BRING STATE-OF-THE-ART CARE TO PATIENTS IN AMERICA AND THROUGHOUT THE WORLD FOR VOICE AND AIRWAY DISORDERS THROUGH PUBLIC AWARENESS, EDUCATION AND RESEARCH, INCLUDING SURGICAL INNOVATION, DEVELOPMENT OF SPECIALIZED SURGICAL TECHNOLOGIES, AND THE SUPPORT OF FELLOWSHIP PROGRAMS TO FURTHER DISSEMINATE INNOVATIONS IN THE FIELD. 10 10 1 10 0 0 693409 163050 420018 0 4779 42871 0 0 1118206 205921 1077000 819907 0 0 48607 67528 0 0 20727 213230 232281 1338837 1119716 -220631 -913795 3833888 2624861 30228 10795 3803660 2614066 X BRING STATE-OF-THE-ART CARE TO PATIENTS IN AMERICA AND THROUGHOUT THE WORLD FOR VOICE AND AIRWAY DISORDERS THROUGH PUBLIC AWARENESS, EDUCATION AND RESEARCH, INCLUDING SURGICAL INNOVATION, DEVELOPMENT OF SPECIALIZED SURGICAL TECHNOLOGIES, AND THE SUPPORT OF FELLOWSHIP PROGRAMS TO FURTHER DISSEMINATE INNOVATIONS IN THE FIELD. 0 0 877777 819907 THE ORGANIZATION'S PRIMARY MEDICAL RESEARCH ACTIVITIES FOCUS ON SPONSORING AND SUPPORTING MEDICAL RESEARCH THAT IS DIRECTED AT IMPROVING THE PREVENTION, DIAGNOSIS, AND TREATMENT OF THROAT, LARYNX, AND VOICE DISORDERS INCLUDING AS CAUSED BY CANCER AND OTHER DISEASES, CONDITIONS AND TRAUMA, ETC. ADDITIONALLY, THE ORGANIZATION FUNDS VARIOUS EDUCATIONAL PROGRAMS TO ENHANCE KNOWLEDGE AND LEARNING IN THE AREA OF VOICE DISORDERS. VHI IS PRIMARILY FUNDED THROUGH GIFTS, GRANTS AND CONTRIBUTIONS FROM INDIVIDUALS AND PRIVATE FOUNDATIONS. 877777 1 1 0 0 0 0 0 0 0 0 1 0 1 0 0 1 1 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 2 0 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 X 10 10 0 0 0 0 0 0 0 1 1 0 0 1 1 1 1 1 1 1 0 1 0 MA CA NY X INSOURCE SERVICES 7812351490 148 LINDEN STREET WELLESLEY MA 02482 X JOHN LICHTENSTEIN PRESIDENT 1.00 X X 0 0 0 JAMES RADTKE TREASURER 1.00 X X 0 0 0 RANDY KNOPP SECRETARY 1.00 X X 0 0 0 JOHN L WARD PHD PRESIDENT EMERITUS 1.00 X 0 0 0 ROGER A EGAN JR DIRECTOR 1.00 X 0 0 0 SCOTT SOLOMBRINO DIRECTOR 1.00 X 0 0 0 ALEX PINCHEV DIRECTOR 1.00 X 0 0 0 TOME ANDRADE DIRECTOR 1.00 X 0 0 0 LEONARD HARLAN DIRECTOR 1.00 X 0 0 0 STEVEN FITZPATRICK DIRECTOR 1.00 X 0 0 0 0 0 0 0 0 0 0 0 163050 163050 42871 42871 205921 0 0 42871 819907 819907 62230 47209 15021 5298 3504 1794 24113 24113 54933 54933 17531 17531 13705 13705 18100 14542 3558 81214 40607 40607 332 332 4736 4736 EVENT EXPENSE 17263 17263 OTHER RESEARCH SUPPORT 354 354 1119716 877777 221212 20727 755455 412486 1927795 1527366 400000 210000 4645 5147 10848 10267 913 581 745080 469281 3833888 2624861 30228 10795 30228 10795 X 2223128 1707468 1580532 906598 3803660 2614066 3833888 2624861 X -913795 -275799 X X 0 1 X 0 0 X 58479 63494 249733 693409 163050 1228165 58479 63494 249733 693409 163050 1228165 623832 604333 245212 79236 770 4779 42871 372868 1601033 895018 0.37750 0.36300 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 7200 6619 581 3648 3648 0 581 INVESTMENT IN INNOVOYCE 469281 C 469281 X 205921 0 205921 0 205921 1119716 0 1119716 0 1119716 PART X, LINE 2: THE ORGANIZATION ACCOUNTS FOR UNCERTAINTY IN INCOME TAXES IN ACCORDANCE WITH ASC TOPIC, INCOME TAXES. THIS STANDARD CLARIFIES THE ACCOUNTING FOR UNCERTAINTY IN TAX POSITIONS AND PRESCRIBES A RECOGNITION THRESHOLD AND MEASUREMENT ATTRIBUTE FOR THE FINANCIAL STATEMENTS REGARDING A TAX POSITION TAKEN OR EXPECTED TO BE TAKEN IN A TAX RETURN. THE ORGANIZATION HAS DETERMINED THAT THERE ARE NO UNCERTAIN TAX POSITIONS WHICH QUALIFY FOR EITHER RECOGNITION OR DISCLOSURE IN THE FINANCIAL STATEMENTS AT JUNE 30, 2023. THE ORGANIZATION'S INFORMATION RETURNS ARE SUBJECT TO EXAMINATION BY FEDERAL AND STATE JURISDICTIONS. 1 MASSACHUSETTS GENERAL HOSPITAL DEPARTMENT OF SURGERY 55 FRUIT STREET BOSTON MA 02114 041564655 501C3 819907 0 RESEARCH AND EDUCATION IN THE FIELD OF LARYNGOLOGY 1 PART I, LINE 2: VHI FUNDS RESEARCH GRANTS TO ORGANIZATIONS FOR THEIR PROGRAMS RELATED TO VOICE. VERBAL REPORTS AND UPDATES OF RESEARCH ENDEAVORS FUNDED BY VHI ARE PROVIDED DURING BOARD MEETINGS AND AN ANNUAL WRITTEN REPORT IS ALSO PROVIDED. FORM 990, PART VI, SECTION B, LINE 11B THE BOARD OF DIRECTORS REVIEWS AND APPROVES THE FORM 990 PRIOR TO ITS FILING. THE FORM 990 IS THEN AUTHORIZED AND SIGNED BY THE ORGANIZATION'S PRESIDENT. FORM 990, PART VI, SECTION B, LINE 12C THE CONFLICT OF INTEREST POLICY IS PROVIDED TO BOARD MEMBERS UPON ELECTION TO THE BOARD OF DIRECTORS. IT IS THEN DISTRIBUTED ANNUALLY ALONG WITH THE DISCLOSURE PAGES. FORM 990, PART VI, SECTION B, LINE 15A VHI'S BOARD OF DIRECTORS IS RESPONSIBLE FOR ESTABLISHING AND MAINTAINING A COMPETITIVE COMPENSATION PROGRAM FOR KEY EMPLOYEES, WHICH FALLS WITHIN A REASONABLE RANGE OF COMPETITIVE PRACTICES FOR COMPARABLE POSITIONS AMONG SIMILARLY SITUATED ORGANIZATIONS. DURING FY 2015, THE BOARD OF DIRECTORS DETERMINED THAT AN EXECUTIVE DIRECTOR WAS NO LONGER NEEDED TO RUN THE ORGANIZATION AND SHIFTED TO THE POSITION OF OPERATIONS MANAGER TO PROVIDE ADMINISTRATIVE SUPPORT AND ORGANIZATIONAL OVERSIGHT. COMPENSATION FOR THE OPERATIONS MANAGER IS DETERMINED BY THE BOARD, WHICH MEETS ON AN AS NEEDED BASIS TO DISCUSS PERFORMANCE AND MAKE RECOMMENDATIONS FOR ANY CHANGES, AS APPROPRIATE. FORM 990, PART VI, SECTION C, LINE 19 THE ORGANIZATION'S GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS ARE AVAILABLE UPON REQUEST. FORM 990, PART VI, SECTION B, LINE 16B: DURING FY 2020, THE VHI BOARD APPROVED A PROGRAM-RELATED INVESTMENT IN INNOVOYCE, LLC, A DELAWARE LIMITED LIABILITY COMPANY ("INNOVOYCE"), WHICH WAS FORMED TO DEVELOP AND COMMERCIALIZE INNOVATIONS IN THE CARE AND TREATMENT OF VOICE DISORDERS. AFTER CAREFUL DUE DILIGENCE AND CONSULTATION WITH COUNSEL, THE BOARD DETERMINED THAT THIS POTENTIALLY GROUNDBREAKING RESEARCH WOULD FURTHER VHI'S MISSION OF ADVANCING LARYNGOLOGY AND VOICE RESTORATION. WITH THIS DETERMINATION, THE VHI BOARD UNANIMOUSLY APPROVED THE ISSUANCE OF A CONVERTIBLE PROMISSORY NOTE (THE NOTE") IN THE AGGREGATE PRINCIPAL AMOUNT OF $4,000,000 WHICH ACCRUES SIMPLE INTEREST AT A RATE OF 6% PER YEAR PAYABLE UPON MATURITY OR CONVERSION OF THE NOTE. DURING FY 2021, A SECOND CONVERTIBLE PROMISSORY NOTE (THE NOTE") IN THE AGGREGATE PRINCIPAL OF $3,000,000 WAS ISSUED TO INNOVOYCE CARRYING SUBSTANTIALLY SIMILAR TERMS. VHI DOES NOT CURRENTLY HAVE A POLICY ON ANCILLARY JOINT VENTURES. WITH THE ADVICE OF COUNSEL AND ITS AUDITOR, THE VHI BOARD CONSIDERED THE NOTE AS ANALOGOUS TO A PROGRAM-RELATED INVESTMENT WITHIN THE MEANING OF INTERNAL REVENUE CODE SECTION 4944. BECAUSE THE INVESTMENT IN INNOVOYCE WAS STRUCTURED AS A LOAN, THE BOARD DID NOT CONSIDER THE RELATIONSHIP WITH THE LLC TO BE A JOINT VENTURE. FORM 990, PART XI, LINE 9: VALUATION ADJUSTMENT OF INNOVOYCE -275,799. FORM 990, PART XI, LINE 9 THE VALUATION ADJUSTMENT OF INNOVOYCE RELATED TO THE FOLLOWING TRANSACTION WHICH VHI ENTERED INTO RELATED TO PROGRAM SPECIFIC INVESTMENTS: ON NOVEMBER 1, 2019, VOICE HEALTH INSTITUTE (THE ORGANIZATION) ENTERED INTO A CONVERTIBLE NOTE PURCHASE AGREEMENT WITH INNOVOYCE. PURSUANT TO THE TERMS OF THE NOTE PURCHASE AGREEMENT, INNOVOYCE ISSUED TO THE ORGANIZATION, IN A PRIVATE PLACEMENT, A CONVERTIBLE PROMISSORY NOTE IN THE AGGREGATE PRINCIPAL AMOUNT OF $4,000,000 (THE NOTE). THE NOTE WAS UNSECURED AND ACCRUED SIMPLE INTEREST AT THE RATE OF 6% PER ANNUM. EVENTS OF DEFAULT UNDER THE NOTE INCLUDE VIOLATIONS OR BREACHES OF THE NOTE OR THE NOTE PURCHASE AGREEMENT, DEFAULTS IN OTHER INNOVOYCE INDEBTEDNESS, A BANKRUPTCY FILING MADE BY INNOVOYCE, OR AN INVOLUNTARY PETITION IS FILED AGAINST IT. UNLESS EARLIER REPAID OR CONVERTED, THE NOTE WAS SET TO MATURE ON THE ONE-YEAR ANNIVERSARY AFTER THE ORGANIZATION MAKES A WRITTEN REQUEST FOR REPAYMENT OF THE NOTE, WHICH MAY BE MADE ONLY ON, OR AT ANY TIME AFTER, THE MATURITY DATE OF NOVEMBER 1, 2023. ON FEBRUARY 15, 2021, THE ORGANIZATION AND INNOVOYCE ENTERED INTO A SECOND NOTE PURCHASE AGREEMENT IN THE AMOUNT OF $3,000,000 WITH THE SAME GENERAL TERMS AND CONDITIONS OF ORIGINAL NOTE (THE SECOND NOTE). UNLESS EARLIER REPAID OR CONVERTED, THE SECOND NOTE MATURES ON THE ONE-YEAR ANNIVERSARY AFTER THE ORGANIZATION MAKES A WRITTEN REQUEST FOR REPAYMENT OF THE SECOND NOTE, WHICH MAY BE MADE ONLY ON, OR AT ANY TIME AFTER, THE MATURITY DATE OF FEBRUARY 15, 2025. ON JUNE 28, 2022 (THE INITIAL CLOSING DATE), THE ORGANIZATION, INNOVOYCE AND TWO OTHER INVESTORS (THE PURCHASERS) CLOSED THE TRANSACTIONS CONTEMPLATED BY THE UNIT PURCHASE AGREEMENT DATED AS OF JUNE 28, 2022, ENTERED INTO BETWEEN THE PARTIES (THE PURCHASE AGREEMENT). PURSUANT TO THE TERMS OF THE PURCHASE AGREEMENT, INNOVOYCE ISSUED IN A PRIVATE PLACEMENT AN AGGREGATE OF 2,368,715 UNITS OF INNOVOYCE, OF WHICH 1,661,958 UNITS WERE ISSUED TO THE PURCHASERS IN CONSIDERATION FOR A CASH PURCHASE PRICE OF APPROXIMATELY $2,000,000, AND 706,757 UNITS (THE VHI UNITS) WERE ISSUED TO THE ORGANIZATION IN CONSIDERATION FOR THE CONVERSION IN FULL OF ALL PRINCIPAL AND ACCRUED INTEREST UNDER THE NOTE AND SECOND NOTE IN THE AGGREGATE AMOUNT OF $7,868,438. AT THE INITIAL CLOSING DATE, THE NOTE AND SECOND NOTE WERE DEEMED TO BE TERMINATED AND THE ORGANIZATION HAD NO FURTHER RIGHTS UNDER THE NOTE AND SECOND NOTE. INNOVOYCE HAD THE RIGHT UNDER THE PURCHASE AGREEMENT TO SELL UP TO AN ADDITIONAL 4,154,970 UNITS AT A PURCHASE PRICE OF $1.2034 PER UNIT FOR A PERIOD OF NINETY DAYS FOLLOWING THE INITIAL CLOSING DATE (OR SUCH LONGER PERIOD AS INNOVOYCE'S BOARD MAY DETERMINE IN ITS SOLE DISCRETION). PURSUANT TO THE TERMS OF THE PURCHASE AGREEMENT, THE ORGANIZATION AND THE PURCHASERS WERE GRANTED INFORMATION RIGHTS PROVIDING THEM WITH ANNUAL AND QUARTERLY FINANCIAL STATEMENTS OF INNOVOYCE, AS WELL AS INSPECTION RIGHTS WITH RESPECT TO INNOVOYCE'S PROPERTIES, BOOKS AND RECORDS. THE PURCHASERS (BUT NOT THE ORGANIZATION) WERE ALSO GRANTED PREEMPTIVE RIGHTS WITH RESPECT TO ANY ISSUANCES OF SECURITIES BY INNOVOYCE. IN ADDITION, ON THE INITIAL CLOSING DATE, THE ORGANIZATION, THE PURCHASERS AND THE OTHER MEMBERS OF INNOVOYCE ENTERED INTO AN AMENDED AND RESTATED OPERATING AGREEMENT OF INNOVOYCE (THE OPERATING AGREEMENT), WHICH SETS FORTH VARIOUS RIGHTS, AGREEMENTS AND OBLIGATIONS OF THE PARTIES, INCLUDING, BUT NOT LIMITED TO, VOTING RIGHTS, RESTRICTIONS ON TRANSFER OF THE UNITS (SUBJECT TO CERTAIN LIMITED EXCEPTIONS), DISTRIBUTIONS, AND THAT INNOVOYCE SHALL BE MANAGED BY A BOARD OF MANAGERS (THE BOARD OF MANAGERS). THE BOARD OF MANAGERS SHALL INITIALLY CONSIST OF FIVE INDIVIDUALS. FOR SO LONG AS THE ORGANIZATION IS A MEMBER OF INNOVOYCE AND OWNS AT LEAST 530,067 UNITS (SUBJECT TO ADJUSTMENT UPON ANY UNIT SPLIT, RECAPITALIZATION OR OTHER SIMILAR EVENT), ALL MEMBERS HAVE AGREED TO VOTE THEIR UNITS TO ELECT AS A MEMBER OF THE BOARD OF MANAGERS ONE INDIVIDUAL DESIGNATED OR NOMINATED BY THE ORGANIZATION. THE MEMBERS OF INNOVOYCE THAT ARE THEN HOLDERS OF A MAJORITY OF THE UNITS HELD BY CERTAIN INDIVIDUALS (THE MAJORITY DESIGNATING MEMBERS) OR, IF THERE ARE NO MAJORITY DESIGNATING MEMBERS, THE MEMBERS HOLDING A MAJORITY OF ALL OF THE UNITS THEN OUTSTANDING, HAVE THE POWER TO INCREASE OR DECREASE THE SIZE OF THE BOARD OF MANAGERS, FILL VACANCIES (EXCEPT FOR THE ORGANIZATION DESIGNEE) ON THE BOARD OF MANAGERS AND REMOVE MEMBERS OF THE BOARD OF MANAGERS. HOWEVER, THE ORGANIZATION DESIGNEE CAN ONLY BE REMOVED FOR CAUSE, IN WHICH CASE THE ORGANIZATION SHALL HAVE THE RIGHT TO DESIGNATE ANOTHER INDIVIDUAL AS A MEMBER OF THE BOARD OF MANAGERS. DISTRIBUTIONS OF AVAILABLE CASH UNDER THE OPERATING AGREEMENT ARE MADE TO MEMBERS AS FOLLOWS: FIRST TO THE PURCHASERS UP TO THEIR INVESTMENT AMOUNT UNTIL REPAID IN FULL, THEN TO THE ORGANIZATION UP TO ITS INVESTMENT AMOUNT ($7,868,438) UNTIL REPAID IN FULL, THEN PRO RATA TO ALL MEMBERS BASED ON EQUITY OWNERSHIP. DURING FISCAL YEAR 2023, ADDITIONAL CAPITAL INVESTMENTS IN THE AMOUNT OF $3,000,002 WERE MADE BY ADDITIONAL INDEPENDENT INVESTORS, REDUCING VHI'S OWNERSHIP PERCENTAGE. THE BOARD'S CONSIDERATION OF THIS ISSUE WAS AS FOLLOWS: THE BOARD OF DIRECTORS OF THE ORGANIZATION MET ON WEDNESDAY, MAY 25, 2022, AND AUTHORIZED THE INVESTMENT COMMITTEE TO EVALUATE THE ORGANIZATION'S POSITION CONCERNING NEW FINANCING AVAILABLE TO INNOVOYCE WHICH WOULD DECREASE THE AS-CONVERTED EQUITY OWNERSHIP POSITION OF THE ORGANIZATION WITH RESPECT TO INNOVOYCE, AND TO REPORT ITS RECOMMENDATION BACK TO THE BOARD. THE BOARD AND THE INVESTMENT COMMITTEE HAD THE BENEFIT OF THE PRESENCE AND ADVICE OF COUNSEL THROUGHOUT ALL OF THE CONSIDERATION OF THESE ISSUES. THE BOARD MET AGAIN ON JUNE 6, 2022, AT WHICH TIME IT RECEIVED AND CONSIDERED THE RECOMMENDATION OF THE INVESTMENT COMMITTEE WHICH HAD IN THE INTERIM CONDUCTED A REVIEW OF THE ISSUES INVOLVED, AGAIN WITH THE INVOLVEMENT AND ADVICE OF COUNSEL. THE BOARD RECEIVED THE COMMITTEE'S RECOMMENDATION THAT THE BOARD APPROVED THE SUBJECT FINANCING, WITH THE REQUIREMENTS THAT SHOULD INNOVOYCE'S PLANNED ADDITIONAL FINANCING TOTAL OF $7,000,000 BE ACHIEVED, THAT THE ORGANIZATION'S AS-CONVERTED EQUITY SHARE BE DOUBLED FROM THAT ORIGINALLY SET OUT IN THE APPLICABLE TERM SHEET OF 4.86% TO 9.72%, AND THAT THE ORGANIZATION'S REPRESENTATIVE SEAT ON THE BOARD OF INNOVOYCE BE PROTECTED. THE 9.72% OWNERSHIP IS BASED ON A FULL FINANCING OF $7,000,000 BEING ACHIEVED. THE VHI CURRENT OWNERSHIP IS 12.60%. THROUGHOUT THE BOARD'S CONSIDERATION, COUNSEL CONTINUED TO INFORM THE INVESTMENT COMMITTEE AND BOARD, AS WAS THE CASE THROUGHOUT THE ORGANIZATION'S SUPPORT OF INNOVOYCE, THAT THE INNOVOYCE INVESTMENTS WERE AND REMAIN DEEPLY CONSISTENT WITH THE ORGANIZATION'S MISSION OF ADVANCING THE FIELD OF VOICE RESTORATION AND LARYNGOLOGY THROUGH THE SUPPORT OF INNOVATIVE RESEARCH, EDUCATION AND OUTREACH. THE BOARD CONSIDERED THE ISSUES ASSOCIATED WITH THE SUBJECT FINANCING AND ACTED FROM CONSIDERATIONS OF BALANCING THE RESULTING DILUTION OF THE ORGANIZATION'S CONVERTED EQUITY POSITION WITH CONSIDERATIONS OF INNOVOYCE'S ACUTE FINANCIAL CONDITION; ITS INABILITY TO RAISE CAPITAL FROM TRADITIONAL OUTSIDE SOURCES; THE UNDERSTOOD FRAGILITY OF THE SUBJECT FINANCING ITSELF; AND THAT THIS FINANCING AS SET OUT WAS EFFECTIVELY INNOVOYCE'S SOLE FUNDING OPTION. FORM 990, PART XI, LINE 9 (CONTINUED) THE BOARD ALSO CONSIDERED THAT PRIOR TO THE ORGANIZATION'S PREVIOUS INVESTMENTS IN INNOVOYCE, ALL MADE TO SUPPORT THE WIDER FIELD OF LARYNGOLOGY THROUGH A MORE BROAD ACCESSIBILITY OF SUCH INNOVATIONS IN VOICE CARE AND RESTORATION, THE ORGANIZATION HAD NO SUCH EQUITY SHARE OR REVENUE FROM ANY OTHER SOURCE; THAT THE FUNDS PREVIOUSLY INVESTED BY THE ORGANIZATION IN INNOVOYCE, IF NOT SO INVESTED, WOULD SIMPLY HAVE BEEN OTHERWISE COMMITTED TO THE SUBJECT RESEARCH; THAT NOTWITHSTANDING THE CASH FLOW DIFFICULTIES OF INNOVOYCE, THAT THE CORE VOICE RESTORING AND TREATING INNOVATIONS AND PRODUCTS OF INNOVOYCE, AND THE EXTENSIVE RESEARCH ACHIEVED TO DATE THROUGH INNOVOYCE, REMAINED DEEPLY SUPPORTIVE OF THE ORGANIZATION'S MISSION; AND, WITH NEW CORPORATE LEADERSHIP COMING INTO INNOVOYCE, ALSO AS ASSESSED BY THE INVESTMENT COMMITTEE, AS WELL AS THE SUBJECT FINANCING, THERE APPEARED TO BE GOOD OPPORTUNITY FOR INNOVOYCE'S SUCCESS. AS WELL, IN THIS CONTEXT, THE BOARD CONCLUDED THAT THERE WAS NOT A MEANINGFUL ALTERNATIVE AS FAILURE OF INNOVOYCE IN THE ABSENCE OF THIS FINANCING WOULD CREATE A COMPLETE LOSS OF THE ORGANIZATION'S INVESTMENT. FOLLOWING CONSIDERATION OF THESE FACTORS, THE BOARD VOTED UNANIMOUSLY TO MOVE FORWARD AS DESCRIBED WITH THE REQUIREMENTS THAT THE ORGANIZATION'S CONVERTED EQUITY SHARE WILL NOT BE LESS THAN 9.72%, AND THAT THE ORGANIZATION'S AS-CONVERTED EQUITY SHARE WILL EXCEED 9.72%, PROPORTIONATELY, CONSISTENT WITH THE INNOVOYCE UNIT FINANCING PRO FORMA CAP TABLE, FOR FUNDING WHICH TOTALS LESS THAN $7 MILLION; AND THAT THE ORGANIZATION'S REPRESENTATIVE SEAT ON THE BOARD OF INNOVOYCE BE PROTECTED. EACH OF THESE REQUIREMENTS WAS MET AND THE ORGANIZATION'S COUNSEL HANDLED THE COMMUNICATION AND EXECUTION OF THE TRANSACTION.