SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-KSB
Annual Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report: December 31, 1999
Stemcell Global Research, Inc.
(Exact name of registrant as specified in its charger)
Nevada 0-26557 88-0407473
State or other jurisdiction (Commission (IRS Employer
Of incorporation) File Number) Identification No.)
9978 Washington Street, Camp Dennision, OH 45111
(Address of principal executive offices) (zip code)
Issuer's telephone number: (513) 831-8007
----------------------
(Mark One)
[X] Annual report pursuant to section 13 or 15(d) of the securities exchange act
of 1934 for the fiscal year ended December 31, 1999.
Transition report under section 13 or 15(d) of the securities exchange act of
1934 for the transition period from to
Securities registered under section 12(b) of the Act: None
Securities registered under Section (g) of the Exchange Act:
Common Stock
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and 92) has been
subject to such filing requirements for the past 90 days. X Yes No
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [x]
Registrant had no revenues to report during its most recent fiscal year.
The aggregate market value of the voting and no-voting common equity held by
non-affiliates ________________.
As of December 31, 1999, registrant had issued and outstanding 1,924,350 shares
of common stock.
Transitional Small Business Disclosure Format (check one): [] Yes [X] No
PART I
ITEM 1. DESCRIPTION OF BUSINESS
A. Business Development and Summary
Stemcell Global Research, Inc. ("STEM," "Stemcell," or the "Company"),
a Nevada corporation incorporated on January 20, 1999, is a developmental stage
company with a principal business objective to develop proprietary process
technologies and devices for a range of cell therapy applications, including
stem cell therapies and gene therapy. The Company intends to focus on the
investigation, production and clinical use of preparations based on Fetal Cells
and Tissues, including the elaboration of complex methods, which include Fetal
Cell Transplants, for the effective treatment of many diseases. The Cell Therapy
process involves the introduction of Human Fetal Cells into the body of the
patient, where the cells locate their target organs, produce generations of
descendants, perform full function and thereby fill deficient or weakened
functions of organs and tissues.
The Company believes that Cell Therapy combines the advantages of a new
branch of Transplantology - Fetal Stem Cell Transplantation - with the modern
achievements of therapy and the simplicity of a normal pharmaceutical
preparations administration. Fetal Stem Cell Transplantation is a branch of
transplantology, related to the transplantation, not of organs or tissues, but
of Embryo Cells - progenitors of pools of Cells, those in charge of certain
functions and systems of the body, including: hemopoiesis, nerve, immune, muscle
and cutaneous systems.
The Company's strategy over the next approximately twelve (12) to
twenty-four (24) months is to establish a consumable-based business model, focus
on established and reimbursed therapies, leverage platform technology across
multiple market opportunities and pursue strategic alliances.
B. Business of Issuer
(1) Principal Products and Services and Principal Markets
Cell Therapy
Cell therapy is the use of human cells to treat a medical disorder. The
most common types of cell therapy, blood and platelet transfusions, have been
widely used for many decades. More recently, bone marrow-derived cells have been
used to restore the bone marrow and the blood and immune system cells which are
damaged by chemotherapy and radiation therapy during the treatment of many
cancers. Transplantation of these cells is known as stem cell therapy. Other
cell therapies have recently been used for generating skin and cartilage tissue
and additional cell therapies are being developed by various companies and
researchers to restore immune system cells as well as bone, kidney, liver,
vascular and neuronal tissues.
Cell therapies require the collection of cells, either from the patient
or a suitably matched donor. These cells are typically processed and stored for
administration to the patient. Although cell therapy is being developed for use
in an increasing number of diseases, widespread application of new cell
therapies remains limited by the difficulties and expense associated with
current cell collection and processing procedures. The problems of current cell
collection techniques are exemplified in the area of stem cell therapy where the
patient or donor undergoes invasive, time-consuming and costly procedures to
collect the large volume of cells currently required for effective treatment.
The Company believes an alternative to collecting the required therapeutic dose
of cells is to grow these cells ex vivo from a small starting volume. However,
ex vivo cell expansion, when biologically possible, has typically required
costly techniques, facilities and operations to comply with FDA good
manufacturing practices ("GMP"), which are not generally available in hospitals.
As a result, cells needed for such therapies often require specialized cell
production facilities which use labor-intensive, manual cell culture techniques.
Stem Cell Therapy
Stem cell therapy is used to treat cancer patients who undergo
chemotherapy or radiation therapy at dose levels that are toxic to the
hematopoietic system, which is comprised of the bone marrow and cells of the
blood and immune systems. The objective of stem cell therapy is to restore the
hematopoietic system via the infusion and subsequent engraftment of healthy
cells to replace bone marrow and result in the rapid recovery of neutrophils and
platelets that have been destroyed by chemotherapy and radiation therapy. Stem
cell therapy reduces the risk of life-threatening infections and bleeding
episodes following cancer treatments. In order to treat many cancers, high
intensity chemotherapy or radiation is often required, which may severely
destroy ("myeloablation") or partially destroy ("myelosuppression") the
patient's hematopoietic system.
Cells required for effective stem cell therapy include stem cells, to
replenish depleted bone marrow and provide a long-term ongoing source of the
multilineage progenitor cells of the blood and immune systems, and early and
late stage hematopoietic progenitor cells, to provide for rapid neutrophil and
platelet recoveries. Stromal accessory cells are believed to further augment the
growth of bone marrow. In the adult, all of these cell types originate in the
bone marrow. These cells are currently collected from the donor or patient
directly through multiple syringe aspirations under anesthesia, known as bone
marrow collection, or through blood apheresis following treatment with drugs
which cause cells to be released or mobilized from the bone marrow into the
blood. This latter technique is known as a peripheral blood progenitor cell
("PBPC") collection. Recently, it has been demonstrated that the blood cells
found in the umbilical cord of newborn infants include cells effective for stem
cell therapy. This source of cells is being explored by physicians as a major
new direction in stem cell therapy, but is currently limited by difficulties in
obtaining sufficient quantities of these cells. Once collected, the stem cell
mixture is infused intravenously and the stem and stromal accessory cells
migrate into the bone cavity where they engraft to form a new marrow. The
hematopoietic progenitor cell components of the cell mixture provide early
restoration of circulating white blood cells and platelets. The replenished bone
marrow will normally provide long-term hematopoietic function, but complete
restoration of bone marrow may take years following myeloablative cancer
therapy. When the patient's hematopoietic system is malignant, such as in the
case of leukemia, cells from a suitable donor are generally required in order to
avoid reintroducing the disease during cell infusion. Such donor derived
transplants are termed "allogeneic" transplants. Procedures using cells derived
from the patient are termed "autologous" transplants.
Stem Cell Therapy Market Opportunity
The Company believes that the benefits of stem cell therapy in the
treatment of cancer patients have been well established over the past two
decades. Stem cell therapy, in the form of bone marrow transplantation, was
originally used in patients who had received treatment for blood and bone marrow
cancers such as leukemia, and genetic diseases of the blood. However, because
stem cell therapy has been shown to promote the rapid recovery of hematopoietic
function, it is now being increasingly used to enable patients with other forms
of cancer to receive high dose or multicycle chemotherapy and radiation
treatments. These high intensity therapies have a greater probability of
eradicating dose sensitive cancers but, because of their hematopoietic toxicity,
cannot generally be given without stem cell therapy. As a result, some patients
are treated with lower and less effective doses, and fewer cycles, of therapy
than might otherwise be used.
Stem cell therapy may also enhance the effectiveness of blood cell
growth factors. The timing and extent of additional cycles of chemotherapy is
often limited by the recovery of a patient's white blood cells and platelets
because a delayed recovery of these cells can leave the patient susceptible to
life-threatening infection and bleeding episodes, and this limitation may allow
for the regrowth of residual tumor cells. Many cancer patients are routinely
treated with growth factors including G-CSF, such as Neupogen and GM-CSF, such
as Leukine, which enhance the development of mature circulating white blood
cells and platelets from the early progenitor bone-marrow derived cells, thereby
decreasing the time between cycles of therapy and the probability of infection.
However, during high dose or multi-cycle therapy, the stem and progenitor cells
on which these growth factors act are often depleted. Without these cells,
growth factors have a limited or negligible effect. Stem cell therapy generally
enhances the effectiveness of growth factors by introducing target stem and
progenitor cells for growth factors to act upon such that patients generally
exhibit a more rapid and consistent hematopoietic recovery.
(2) Distribution Methods of the Products or Services
Management's objective is to build a leadership position in cell
therapy process technology. The primary elements of the Company's business
strategy are as follows:
Establish Consumable Based Business Model
Management's strategy is to sell the Company's technologies to
institutions, hospitals, and other clinical care or commercial cell production
facilities that are administering cell therapy. The Company plans to obtain
ongoing revenue from the sale of single-use disposable Cell Cassettes and
related cell culture media and reagents, which are utilized in individual cell
therapy applications. After cells are cultured in the Cell Cassette, the
cassette is discarded and a new cassette is utilized for a subsequent patient.
Along with ongoing revenue from the sale of instruments and disposables for cell
therapy applications, the Company believes it will be able to obtain license
revenue from its stem cell therapy applications for its proprietary stem cell
processes.
Focus Initially on Established and Reimbursed Therapies
Management of the Company seeks to establish the use of its processes
in the field of stem cell therapy for the treatment of toxicity resulting from
many cancer therapies, including those for breast cancer, lymphoma, ovarian
cancer, germ cell cancers, leukemias and aplastic anemias. Stem cell therapy is
a well-established and growing treatment modality in cancer therapy, and current
cell collection procedures are widely reimbursed by third party payors.
Leverage Platform Technology Across Multiple Market Opportunities
In addition to stem cell therapy applications, the Company believes
that its Stem Cell technology may serve as a platform product that can be used
to produce a variety of other cells for multiple therapeutic applications, such
as T-cells for use in lymphocyte therapies, chondrocytes for cartilage
replacement, and mesenchymal cells for use in certain solid tissue therapies.
The Company believes that if its technology is well established as a method for
cell production for use in stem cell therapy, the process will be positioned for
commercialization of new cell and ex vivo gene therapies that are under
development.
Pursue Strategic Acquisitions and Alliances
The Company believes that there are numerous opportunities to acquire
other businesses with established bases, compatible operations, experience with
additional or emerging Internet services and technologies, and experienced
management. The Company believes that these acquisitions, if successful, will
result in synergistic opportunities, and may increase the Company's revenue and
income growth. However, of this, the Company can give no assurance. The Company
intends to seek opportunities to acquire businesses, services and/or
technologies that it believes will complement its business operations. The
Company plans to seek opportunistic acquisitions that may provide complementary
technology, expertise or access to certain markets. In addition, the Company may
seek to acquire certain component technologies that may provide opportunities to
accelerate its service development efforts. No specific acquisition candidates
have been identified, however, and no assurance can be given that any
transactions will be effected, or if effected, will be successful.
In addition, the Company may pursue strategic alliances with partners
who have established operations. As part of these joint venture agreements, the
Company may make investments in or purchase a part ownership in these joint
ventures. The Company believes that these joint venture relationships, if
successful, will result in synergistic opportunities, allowing the Company to
gain additional insight, expertise and penetration in markets where joint
venture partners already operate, and may increase the Company's revenue and
income growth. No specific joint venture agreements have been signed, however,
and no assurance can be given that any agreements will be effected, or if
effected, will be successful.
(3) Status of Any Announced New Product or Service
The Company has limited operating history. The Company was organized on
January 20, 1999. Activities to date have been limited primarily to
organization, initial capitalization, finding and securing an appropriate,
experienced management team and board of directors, the development of a
business plan, and commencing with initial operational plans.
As of march 31, 2000, the Company has developed a business plan,
recruited and retained an experienced management team and board of directors,
and established what steps need to be taken to achieve the results set forth in
this Registration Statement. As a start-up and development stage company, the
Company has no new products or services to announce.
(4) Industry Background
The Company estimates that over 35,000 stem cell therapy procedures
were completed worldwide in 1995, and that the number of such procedures is
growing at a compound annual rate of over 20%. This growth has been driven by
encouraging clinical results in the treatment of dose-sensitive solid tumors,
such as breast and ovarian cancers. The Company expects that stem cell therapy
procedures will continue to grow due to increased incidence and prevalence of
cancer, continued clinical demand for myelotoxic cancer treatment, and the
increased cost effectiveness of stem cell therapy treatments.
(5) Raw Materials and Suppliers
Currently, the bone marrow-derived cells required for stem cell therapy
are collected primarily either through the bone marrow harvest method or the
PBPC collection method.
Bone Marrow Harvest
A traditional bone marrow harvest is a costly and invasive surgical
procedure in which a physician removes approximately one liter of bone marrow
from a patient or donor. This volume of bone marrow is removed using needles
inserted into the cavity of the hip bone. The bone marrow harvest procedure
typically requires between two to four hours of operating room time, with the
physician often making more than 100 separate puncture sites in the hip bone to
collect the necessary amount of bone marrow. Due to the length of the procedure
and the trauma to the patient, general surgical anesthesia is administered and
the patient is typically hospitalized for a day. Frequently, the patient suffers
pain from the procedure for several days after being discharged from the
hospital. Furthermore, complications resulting from the general anesthesia or
invasive nature of the procedure occur in a small percentage of patients. Bone
marrow harvest provides a reliable source of stem and stromal accessory cells
and has been the preferred source of cells in allogeneic transplants.
PBPC Mobilization and Collection
PBPC mobilization is a newer technique in which bone marrow-derived
cells are harvested from a patient's or donor's circulating blood, rather than
from bone marrow. In a PBPC mobilization procedure, the patient receives
multiple injections of growth factors or cytotoxic drugs, or both, over the
course of a week or more, which cause stem and progenitor cells resident in the
bone marrow to mobilize into the circulating blood. The mobilized cells are then
collected by connecting the patient to a blood apheresis device, which draws and
returns large volumes of the patient's or donor's blood in order to selectively
remove the therapeutic volume of stem and progenitor cells. Each collection
procedure typically lasts for two to six hours and is typically repeated on two
to eight consecutive days. Specialized laboratory testing over the period of
mobilization and cell harvesting is necessary to determine that a sufficient
quantity of desired cells has been collected, adding to the cost of the
procedure. The PBPC process has become the predominant procedure in autologous
stem cell therapy.
Procedure Considerations
Although stem cell therapy is being utilized to treat more patients for
a broader range of diseases, its availability continues to be limited by the
high costs of procuring cells, the invasive nature of traditional cell
procurement techniques, and by the technical difficulties related to those
collection procedures. The Company estimates that current costs for bone marrow
harvest and processing are approximately $10,000 to $15,000 per procedure, with
considerable variability between institutions. The Company estimates that
current costs for PBPC collection, including mobilization with growth factors,
are approximately $12,000 to $20,000 for a two to three cycle procedure, with
considerable variability between institutions depending on the total volume,
time and number of aphereses required. Overall costs of stem cell therapy
include the costs of the cell collection procedure, and the costs associated
with supporting the patient during post-transplant recovery. Post-transplant
costs include hospitalization time, antibiotic support, management of adverse
reactions to the large volume cell infusions, and infusions of platelets and red
blood cells. Any new stem cell therapy process will generally need to provide
similar recovery endpoints to be competitive with the current procedures. In
this regard, PBPC procedures have gained popularity compared with bone marrow
harvests because the number of platelet transfusions is reduced for some
patients.
Umbilical Cord Blood
Umbilical cord blood ("UCB"), which is collected directly from the
umbilical cord after delivery, without pain or risk to the infant or the mother,
is emerging as a new source of cells for stem cell therapy. UCB has been
reported to have stem cell concentrations that are much higher than that
typically obtained from traditional bone marrow and PBPC collection methods.
After collection, UCB is typically frozen for later use in a stem cell therapy
procedure. Storage of UCB samples involves small volumes of cells, compared to
typical bone marrow or PBPC storage. Accordingly, the costs of collection and
storage of UCB cells are comparatively low. This source of cells is also
"tumor-free," such that UCB would be preferred for many current stem cell
therapy procedures in metastatic cancer patients. Before UCB can become a major
supply source for stem cell therapy, a coordinated UCB banking system must
emerge. In this regard, several organized UCB banking institutions have been
established to date, and the group is growing in both number and size.
One current disadvantage of UCB is the relatively low number of
available cells. Unlike bone marrow or PBPC harvest, where the collection of
more cells to meet a particular treatment is typically achievable, the number of
cells available from a UCB donor is limited. This problem is exacerbated by the
required cryopreservation of the cells, which causes a significant cell loss.
The resultant low cell number is believed to be responsible for the longer
hematopoietic recovery times observed with UCB transplants, as compared with
bone marrow or PBPC transplants. Further, because of the low cell number, UCB
transplants are typically restricted to small patients. Therefore, increasing
the number of therapeutic cells from a UCB sample would facilitate the more
widespread use of UCB transplants. The Company believes that providing the
transplant site with the capability to carry out the UCB cell expansion will be
a major factor in the increased use of UCB for stem cell therapy and a
significant business opportunity.
(6) Customers
The Company will provide cell therapy process technology to medical
industry customers worldwide. The Company plans to reach these customers via
direct mail, telemarketing, seminars, trade shows, the Internet and the referral
process. As of March 31, 2000, no sales revenues have been generated by the
Company. In addition, the Company does not expect to generate any sales revenues
in the foreseeable future. The Company does not anticipate that its revenues
will be dependent, however, on any one or even a few major customers once its
revenues begin, however.
(7) Patents, Trademarks, Licenses, Franchises, Concessions, Royalty
Agreements, or Labor Contracts
The Company does not currently own any patents on its technologies. New
proprietary technological advancements are being protected as trade secrets
until appropriate measure can be taken for protection. The Company believes,
however, that its success and ability to compete is dependent in part on the
protection of its potential trademarks, trade names, service marks, patents and
other proprietary rights and technology. The Company intends to rely on trade
secret, patent and copyright laws to protect the intellectual property that it
plans to develop, but there can be no assurance that such laws will provide
sufficient protection to the Company, that others will not develop products,
technology and services that are similar or superior to those of the Company's,
or that third parties will not copy or otherwise obtain and use the Company's
proprietary technology without authorization.
Policing unauthorized use of the Company's proprietary and other
intellectual property rights, in the future, could entail significant expense
and could be difficult or impossible. In addition, there can be no assurance
that third parties will not bring claims of copyright, patent or trademark
infringement against the Company or claim that certain of the Company's
products, technology, processes or features violates a patent. There can be no
assurance that third parties will not claim that the Company has misappropriated
their creative ideas or formats or otherwise infringed upon their proprietary
rights. Any claims of infringement, with or without merit, could be time
consuming to defend, result in costly litigation, divert management attention,
require the Company to enter into costly royalty or licensing arrangements to
prevent the Company from using important technologies or methods, any of which
could have a material adverse effect on the Company's business, financial
condition or operating results.
(8) Regulation
The Company's research and development activities and the manufacturing
and marketing of the Company's products may be subject to the laws and
regulations of governmental authorities in the United States and other countries
in which its products will be marketed. Specifically, in the United States the
FDA, among other activities, regulates new product approvals to establish safety
and efficacy of these products. Governments in other countries have similar
requirements for testing and marketing. In the U.S., in addition to meeting FDA
regulations, the Company is also subject to other federal laws, such as the
Occupational Safety and Health Act and the Environmental Protection Act, as well
as certain state laws.
Regulatory Process in the United States
Management anticipates the Company's products to be potentially subject
to Regulation as medical devices under the Federal Food, Drug, and Cosmetic Act,
and as biological products under the Public Health Service Act, or both.
Different regulatory requirements may apply to the Company's products depending
on how they are categorized by the FDA under these laws. The FDA is still in the
process of developing its requirements with respect to somatic cell therapy and
gene cell therapy products and has recently issued a draft document concerning
the Regulation of umbilical cord blood stem cell products. If the FDA adopts the
regulatory approach set forth in the draft document, the FDA may require
separate regulatory approval for such cells in some cases. The FDA also recently
proposed a new type of license, called a biologic license application ("BLA"),
for autologous cells manipulated ex vivo and intended for structural repair or
reconstruction. This proposal may indicate that the FDA will extend a similar
approval requirement to other types of autologous cellular therapies, such as
autologous cells for stem cell therapy. Any such additional regulatory or
approval requirements could significantly delay the introduction of the
Company's product candidates to the market, and have a material adverse impact
on the Company.
Approval of new medical devices and biological products is a lengthy
procedure leading from development of a new product through pre-clinical and
clinical testing. This process takes a number of years and the expenditure of
significant resources. There can be no assurance that the Company's product
candidates will ultimately receive regulatory approval.
(9) Effect of Existing or Probable Government Regulations
Regardless of how the Company's product candidates are regulated, the
Federal Food, Drug, and Cosmetic Act and other Federal statutes and regulations
govern or influence the research, testing, manufacture, safety, labeling,
storage, record keeping, approval, distribution, use, reporting, advertising and
promotion of such products. Noncompliance with applicable requirements can
result in civil penalties, recall, injunction or seizure of products, refusal of
the government to approve or clear product approval applications or to allow the
Company to enter into government supply contracts, withdrawal of previously
approved applications and criminal prosecution.
(10) Research and Development Activities
Potential Advantages of the Company's Technology
The Company is in the process of developing proprietary process
technologies that the Company's management believes are pioneering the ex vivo
production of human stem and progenitor cells. The Company believes potential
advantages of the Company's Stem Cell technology include, but are not limited
to, the following:
Reduced Cost
Management believes the Company's technology has the potential to
replace more costly, labor intensive and invasive cell collection procedures
currently employed for stem cell therapy and to reduce physician, staff and
patient time requirements.
Reduced Patient and Physician Burden
Cell production with the Company's products are expected to require the
collection of a small volume of starting material compared to current collection
procedures, eliminating the requirement for general surgical anesthesia,
multiple drug injections and blood apheresis. Patient benefits include fewer
needle sticks than with current cell collection methods and a reduction in
overall patient procedure time. Additionally, the Company's process for cell
expansion is expected to minimize the time requirement for physicians compared
with bone marrow harvest.
Enhanced Multicycle High-Dose Chemotherapy
The long restoration period for the hematopoietic system following
myeloablative therapy effectively limits patients to one opportunity for cell
collection prior to cancer therapy. The Company believes it's technology may
enhance the practice of multi-cycle, high-dose chemotherapy by providing the
ability to produce a therapeutic dose of cells from a small starting volume. The
initial cell collection can be divided into multiple samples and stored frozen
until expansion at a later time is required.
Reduced Quantity of Lymphocytes
The Company believes its approach to stem cell therapy may provide an
additional benefit over current methods by depleting potentially harmful cells
such as T-cells and B-cells. These cells are believed to be primarily
responsible for graft-versus-host disease, a common manifestation of allogeneic
transplants in which the grafted donor's cells attack the host's tissues and
organs.
Tumor Cell Purging
Cancer patients with tumor metastases, in which the cancer has spread
to the blood and bone marrow, have not traditionally been candidates for
autologous stem cell transplants because transplant may reintroduce cancer cells
into the patient. Additionally patients may have undetected tumor cells in their
marrow or PBPC transplant, which can reestablish the cancer in the patient
following transplant. The Company's process may offer benefits for these groups
of patients. The Company and other investigators seek to show that some primary
human tumor cells die or do not grow during hematopoietic cell culture. Further,
the smaller volume of starting cells used by the Company's process compared with
BMT or PBPC transplants shall provide approximately 10 to 70 fold less tumor
cells in a transplant. This combination of passive depletion during culture with
the lower starting volume of tumor cells may result in a tumor-free or
tumor-reduced cell product for transplant. The benefit of such tumor depletion,
if any, will vary depending upon the type of cancer and state of disease.
Additional Stem Cell and Other Cell Therapies
The Company believes that its products and processes may be developed
to serve as platform products for application in a variety of other cell
therapies in addition to stem cell therapy. The Company believes that its Stem
Cell technology has the potential to supplant current manual cell culture
methods to produce therapeutic quantities of cell types such as T-cells,
chondrocytes, mesenchymal cells, keratinocytes, neuronal cells and dendritic
cells. Currently such cells are often produced in specialized facilities
generally using manual cell culture techniques which limit the effective
commercialization of these cell types for therapy. Potential advantages of the
Stem Cell processes in these therapies may include: (i) reducing labor and
capital costs; (ii) enhancing process reliability; (iii) automating quality
assurance; and (iv) reducing the need for environmentally controlled facilities.
Modification of such processes and application of the Company's
products to the expansion of other cell types may require substantial additional
development of specialized culture environments and which may need to be
incorporated within the Company's existing cell cassettes. There can be no
assurances that the Company will be able to successfully modify or develop
existing or future products to enable such additional cell production processes.
Furthermore, other than a limited application of chondrocyte therapy, novel cell
therapies are still in early stages of development by third parties. The
Company's business opportunity is dependent upon successful development and
regulatory approval of these novel cell therapies. No assurance can be given
that such novel therapies will be developed or approved or that the Company's
processes or product candidates will find successful application in such
therapies.
Immunotherapies
Immunotherapy involves using cells of the immune system to eradicate a
disease target. T-cell lymphocytes and dendritic cells are being actively
investigated by other companies for this purpose, and these procedures require
ex vivo cell production.
T-cells, a class of lymphocyte white blood cells, play a critical role
in the human immune system and are responsible for the human immune response in
a broad spectrum of diseases, including cancers and infectious diseases.
Cytotoxic T-lymphocytes ("CTLs") is a new process that involves collecting
T-cells from a patient and culturing them in an environment resulting in T-cells
with specificity for a particular disease target. Clinical trials by third
parties have been completed demonstrating CTL effectiveness for certain
diseases. The ex vivo production of these cells under conditions for use in
medical treatment represents a critical step in the advancement of this therapy.
Dendritic cells (the potent antigen presenting cells) are believed to
play an important role in the function of the immune system. Researchers believe
that cultured dendritic cells could augment the natural ability of a patient to
present antigens from the infectious agents to the immune system and aid in the
generation of a cytotoxic T-cell response to the infectious agent. The Company
intends to explore application of its products and processes for the expansion
of dendritic cells.
Solid Tissue Cell Therapies
One of the newest areas of cell therapy involves the production of
chondrocytes for the restoration of cartilage. Chondrocyte therapy involves the
surgical removal of a small amount of tissue from the patient's knee and a
therapeutic quantity of chondrocytes is produced from this surgical biopsy. The
cells are then implanted into the patient's knee. Published reports indicate
that such cells then reestablish mature articular cartilage. Currently, this
cell production process is completed in highly specialized laboratory facilities
using trained scientists and manual laboratory procedures. The Company believes
its technology has the potential to reduce costs associated with the cell
production procedure and may eventually facilitate the transfer of the cell
production capability away from specialized facilities directly to the clinical
care sites.
Other Stem Cell Therapies
Autoimmune Disease. Stem cell therapy is under clinical investigation
for the treatment of other diseases. Clinical studies have suggested a potential
role for stem cell therapy in treatment of autoimmune diseases such as
rheumatoid arthritis, multiple sclerosis and lupus erythematosus. The generic
cause of these diseases is a malfunctioning immune system, including T-
lymphocytes. Clinical trials in which the patient receives treatment resulting
in immune ablation (usually involving myelotoxic cancer drugs or radiation),
followed by stem cell therapy to restore the bone marrow and cells of the blood
and immune system, have demonstrated remission of the autoimmune disease in some
patients.
Organ Transplantation. Recently, a number of academic and corporate
researchers and companies have identified the potential use of stem cell therapy
to facilitate successful solid organ and tissue transplants between human donors
and recipients, as well as using organs from non-human species for
transplantation into humans. These proposed applications are based on the
observation that donor-specific bone marrow, infused concurrent with or prior to
the organ transplant, can provide for reduction of the normal immune rejection
response by the transplant recipient (e.g. heart, lung, liver or kidney
transplants).
A major limitation to the use of stem cell therapy in solid organ
transplant is the limited availability of sufficient amounts of bone marrow to
obtain a desired therapeutic response of immune tolerization. This limitation is
particularly problematic when cadaveric donor organs are available, which has
traditionally been the source of cells for these procedures. Bone marrow is also
often available from the cadaveric donor, but only in a limited amount. Normally
this amount may be sufficient for one transplant, but a donor might provide
multiple organs for transplant into multiple recipients. The Company believes
that the ability to expand the available bone marrow ex vivo will enhance the
use of stem cell therapy for such transplant procedures.
(11) Impact of Environmental Laws
The Company is not aware of any federal, state or local environmental
laws which would effect its operations.
(12) Employees
As a start up company in the research and development phase - in order
to more prudently manage the Company's limited resources, the Company presently
has no (0) full time employees and four (4) part time employees. The Company's
employees are currently not represented by a collective bargaining agreement,
and the Company believes that its relations with its employees are good. The
Company does not currently pay any salaries to its part time employees who are
officers of the Company.
ITEM 2. DESCRIPTION OF PROPERTY
A. Description of Property
The Company's corporate headquarters are located at 9978 Washington
Street, Camp Dennison, Ohio 45111. The office space is provided by one of the
officers of the Company at no cost to the Company. The Company does not have any
additional facilities. Additionally, there are currently no proposed programs
for the renovation, improvement or development of the properties currently being
utilized by the Company.
B. Investment Policies
Management of the Company does not currently have policies regarding
the acquisition or sale of assets primarily for possible capital gain or
primarily for income. The Company does not presently hold any investments or
interests in real estate, investments in real estate mortgages or securities of
or interests in persons primarily engaged in real estate activities.
A. Description of Property
The Company's corporate headquarters are located at 9978 Washington
Street, Camp Dennison, Ohio 45111. The office space is provided by one of the
officers of the Company at no cost to the Company. The Company does not have any
additional facilities. Additionally, there are currently no proposed programs
for the renovation, improvement or development of the properties currently being
utilized by the Company.
ITEM 3. LEGAL PROCEEDINGS
The Company is not currently involved in any legal proceedings nor does
it have knowledge of any threatened litigation.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matters were submitted during the fourth quarter of the fiscal year covered
by this report to a vote of security holders, through the solicitation of
proxies or otherwise.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS.
A. Market Information.
There is currently no public trading market for the registrant's securities.
B. Holders.
Registrant has approximately fifty-one (51) shareholders of record.
C. Dividends.
The registrant has not paid any dividends to date. There are no restrictions
that would limit the ability to pay dividends on common equity or that are
likely to do in the future.
D. Recent Sales of Unregistered Securities.
In April of 1999, the Company completed a public offering of shares of
common stock of the Company pursuant to Regulation D, Rule 504 of the Securities
Act of 1933, as amended, whereby it sold 273,225 shares of the Common Stock of
the Company to 28 unaffiliated shareholders of record. The Company filed an
original Form D with the Securities and Exchange Commission on or about April 5,
1999. As of March 31, 2000, the Company has 1,924,350 shares of common stock
issued and outstanding held by 51 shareholders of record.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
A. Management's Plan of Operation
(1) In its initial operating period ended December 31, 1999, the Company
incurred a net loss of $210,072.00 for selling, general and administrative
expenses related to start-up operations. It has yet to receive any revenues
from operations. On January 22, 1999, approximately twenty three (23)
founding shareholders purchased 1,651,125 shares of the Company's authorized
treasury stock for cash. This original stock offering was made pursuant to
Nevada Revised Statues Chapter 90.490. Additionally, in March of 1999, the
Company completed an offering of two hundred seventy three thousand two hundred
and twenty five (273,225) shares of the Common Stock of the Company to
approximately twenty eight (28) unaffiliated shareholders. This offering was
made in reliance upon an exemption from the registration provisions of Section
4(2) of the Securities Act of 1993, as amended, pursuant to Regulation D, Rule
504 of the Act. As of the date of this filing, the Company has one million nine
hundred twenty four thousand three hundred and fifty (1,924,350) shares of its
$0.001 par value common voting stock issued and outstanding which are held by
approximately fifty one (51) shareholders of record. Management fully
anticipates that the proceeds from the sale of all of the Common Shares sold in
the public offering delineated above will be sufficient to provide the Company's
capital needs for the next approximately six (6) months to twelve (12) months.
The Company currently has no arrangements or commitments for accounts and
accounts receivable financing. There can be no assurance that any such financing
can be obtained or, if obtained, that it will be on reasonable terms.
This is a development stage company. The Company believes that its
initial revenues will be primarily dependent upon the Company's ability to cost
effectively and efficiently provide cell therapy process technologies to the
medical profession. The Company designates as its priorities for the first
twelve months of operations as developing and emphasizing its existing cell
therapy technologies to establish its business in the biotechnology market.
Realization of sales of the Company's products, services and/or technology
during the fiscal year ending December 31, 2000 is vital to its plan of
operations. There are no guarantees that other cell therapy technologies or
products similar to the Company's could not enter the market first; if they
enter the market first, this would dramatically curtail any earnings potential
for the Company. Additionally, a superior competitive technology or product
could force the Company out of business.
As of March 31, 2000, the Company has yet to generate any revenues. In
addition, the Company does not expect to generate any revenues over the next
approximately twelve(12) months. This raises substantial doubt about its ability
to continue as a going concern. The company has received a going concern opinion
on its audited financial statements.
(2) No engineering, management or similar report has been prepared or provided
for external use by the Company in connection with the offer of its securities
to the public.
(3) Management believes that the Company's future growth and success will be
largely dependent on its ability to develop or acquire products and technology
to meet the evolving needs of its prospective customers. The Company believes
that the long-term success of its product offerings and technology will require
substantial research and development.
The Company has yet to incur any research and development costs from
January 20, 1999 (date of inception) through March 31, 2000. However, during the
fiscal and calendar year ending December 31, 2000, the Company plans to incur
research and development expenses of approximately $10,000 with respect to its
current and future products and technology. The cost of such activities are not
expected to be borne by the Company's customers.
(4) The Company currently does not expect to purchase or sell any of its
facilities or equipment.
(5) Management does not anticipate any significant changes in the number of
employees over the next approximately twelve (12) months.
B. Segment Data
As of March 31, 2000, no sales revenue has been generated by the
Company. Accordingly, no table showing percentage breakdown of revenue by
business segment or product line is included.
ITEM 7. FINANCIAL STATEMENTS.
TABLE OF CONTENTS
PAGE
INDEPENDENT AUDITORS' REPORT.................................. 1
BALANCE SHEET - ASSETS........................................ 2
BALANCE SHEET - LIABILITIES AND SHAREHOLDER'S EQUITY.......... 3
STATEMENT OF OPERATIONS....................................... 4
STATEMENT OF STOCKHOLDERS' EQUITY............................. 5
STATEMENT OF CASH FLOWS....................................... 6
NOTES TO FINANCIAL STATEMENTS................................. 7
<PAGE>
James E. Slayton, CPA
2858 WEST MARKET STREET
SUITE C
AKRON, OHIO 44333
1-330-864-3553
INDEPENDENT AUDITORS' REPORT
Board of Directors June 27, 2000
Stemcell Global Research, Inc. (The Company)
Las Vegas, Nevada 89102
I have audited the Balance Sheet of Stemcell Global Research, Inc. (A
Development Stage Company) as of December 31, 1999, and the related Statements
of Operations, Stockholders' Equity and Cash Flows for the period January 20,
1999 (Date of Inception) to December 31, 1999. These financial statements are
the responsibility of the Company's management. My responsibility is to express
an opinion on these financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that I plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement presentation. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. I believe that my audit provides a reasonable basis for my
opinion.
In my opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Stemcell Global Research, Inc.,
(A Development Stage Company), as of December 31, 1999, and the results of its
operations and cash flows for the period January 20, 1999 (Date of Inception) to
December 31, 1999, in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 3 to the financial
statements, the Company has had limited operations and has not generated
significant revenues from planned principal operations. This raises substantial
doubt about its ability to continue as a going concern. Management's plan in
regard to these matters is also described in Note 3. The financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.
James E. Slayton, CPA
Ohio License ID# 04-1-15582
<PAGE>
Stemcell Global Research, Inc.
(A Development Stage Company)
BALANCE SHEET
AS AT
December 31, 1999
ASSETS
ASSETS
CURRENT ASSETS
Cash 7,775.00
Money Market Account 15,374.00
-------------------
Total Current Assets 23,149.00
PROPERTY AND EQUIPMENT
Property and Equipment 0.00
-------------------
Total Property and Equipment 0.00
OTHER ASSETS
Other Assets 0.00
-------------------
Total Other Assets 0.00
-------------------
TOTAL ASSETS $23,149.00
===================
See accompanying notes to financial statements
-2-
<PAGE>
Stemcell Global Research, Inc.
(A Development Stage Company)
BALANCE SHEET
AS AT
December 31, 1999
LIABILITIES & EQUITY
CURRENT LIABILITIES
Accounts Payable $ 0.00
-------------------
Total Current Liabilities 0.00
OTHER LIABILITIES
Convertible Notes Payable 85,000.00
Accrued Interest Payable 2,458.00
-------------------
Total Other Liabilities 87,458.00
-------------------
Total Liabilities 87,458.00
EQUITY
Common Stock, $0.001 par value, authorized 20,000,000 shares; issued
and outstanding at December 31, 1999 1,924,350 common shares 1,924.00
Additional Paid in Capital 143,839.00
Retained Earnings (Deficit accumulated during development stage) (210,072.00)
Advances from shareholder 0.00
-------------------
Total Stockholders' Equity (64,309.00)
-------------------
TOTAL LIABILITIES & OWNER'S EQUITY $23,149.00
===================
See accompanying notes to financial statements
-3-
<PAGE>
Stemcell Global Research, Inc.
(A Development Stage Company)
STATEMENT OF OPERATIONS
FOR PERIOD
January 20, 1999 (Date of Inception) to December 31, 1999
REVENUE
Revenues 0.00
Interest Income 374.00
----------------
Total Revenue 374.00
COSTS AND EXPENSES
Selling, General and Administrative 210,446.00
----------------
Total Costs and Expenses 210,446.00
----------------
Net Income or (Loss) before taxes (210,072.00)
Income Tax Expense 0.00
================
Net Ordinary Income or (Loss) (210,072.00)
Weighted average
number of common
shares outstanding 1,881,856
Basic Net Loss Per Share (0.11)
See accompanying notes to financial statements
-4-
<PAGE>
Stemcell Global Research, Inc.
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR PERIOD
January 20, 1999 (Date of Inception) to December 31, 1999
<TABLE>
<CAPTION>
Deficit
accumulated Total
Common Additional during Stockholder's
Stock paid-in Note development Equity
Shares Amount capital Receivable stage
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
January 21, 1999
Issued for cash and
cancellation of debt to
shareholders 1,651,125 1,651.00 7,500.00 9,151.00
March 9, 1999
Issued for cash and
services rendered 273,225 273.00 136,339.00 5,000.00 141,612.00
July 1, 1999 received
cash for note (5,000.00) (5,000.00)
Net Profit
January 21,1999
(inception) to
December 31, 1999 (210,072.00) (210,072.00)
-------------------------------------------------------------------------------------------------------------------------------
Balances as at
December 31,1999 1,924,350 $1,924.00 $143,839.00 $0.00 ($210,072.00) ($64,309.00)
===============================================================================================================================
</TABLE>
See accompanying notes to financial statements
-5-
<PAGE>
Stemcell Global Research, Inc.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
FOR PERIOD
January 20, 1999 (Date of Inception) to December 31, 1999
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) from operations ($210,072.00)
Adjustments to reconcile net income to net cash provided
Increase in interest payable 2,458.00
Services rendered for stock 45,562.00
-----------------
Net Cash provided by Operating Activities (162,052.00)
CASH FLOWS FROM INVESTING ACTIVITIES
----------------
Net cash used by investing activities 0.00
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of Capital Stock 95,201.00
Cash received from convertible note payable 127,500.00
Repayments on convertible note payable (42,500.00)
Collection of Note Receivable for Common Stock Subscriptions 5,000.00
----------------
Net cash provided by financing activities 185,201.00
Net increase (decrease) in cash 23,149.00
Balance as at end of period 23,149.00
See accompanying notes to financial statements
-6-
<PAGE>
Stemcell Global Research, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - HISTORY AND ORGANIZATION OF THE COMPANY
The Company was organized January 20, 1999 (Date of Inception) under the
laws of the State of Nevada, as Stemcell Global Research, Inc. (The Company) has
no operations and in accordance with SFAS #7, the Company is considered a
development stage company. The Company has 20,000,000 shares of $.001 par value
stock authorized.
On January 21, 1999, the Company issued 1,651,125 Shares of its $0.001 par
value common stock for cash of $1,651.13 and cancellation of a $7,500.00 loan
from a founding shareholder for corporate consulting costs.
On March 9, 1999, the Company completed a public offering that was exempt
from federal registration pursuant to Regulation D, Rule 504 of the Securities
Act of 1933 as amended, and exempt from state registration pursuant to various
state securities transaction exemptions. The Company sold 273,225 shares of
Common Stock at a price of $0.50 per share for a total amount raised of
$136,612.50. The Company received cash in the amount of $93,535.00, a note
receivable in the amount of $5,000.00 and exchange for services rendered in the
amount of $38,062.50.
On September 25, 1999 a convertible promissory note was signed with
Atlantique Capital Group, Inc. At December 31, 1999, the amount of the note was
$85,000.00 at a per annum rate of 12%.
There have been no other issuances of equity or Common Stock.
NOTE 2 - ACCOUNTING POLICIES AND PROCEDURES
Accounting policies and procedures have not been determined except as
follows:
1. The Company uses the accrual method of accounting.
2. The cost of organization was expensed when incurred.
3. Basic earnings per share is computed using the weighted
average number of shares of common stock outstanding. Diluted earnings per
share were not include as the inclusion of convertible notes would be anti-
dilutive and all contingencies for conversion have not occurred.
4. The Company has not yet adopted any policy regarding
payment of dividends. No dividends have been paid since inception.
5. The cost of equipment is depreciated over the estimated
useful life of the equipment utilizing the straight line method of depreciation.
There was no depreciation during this operating period. There was no equipment
purchased through December 31, 1999.
-7-
Stemcell Global Research, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
NOTE 2 - ACCOUNTING POLICIES AND PROCEDURES - CONTINUED
6. The Company experienced losses for its first operating
period January 20, 1999 (Date of inception) to December 31, 1999. The Company
will review its need for a provision for federal income tax after each operating
quarter and each period for which a statement of operations is issued. The net
operating losses will begin to expire in the year 2014.
7. The Company has adopted December 31 as its fiscal year
end.
8. The Company records its inventory at cost. There was no
inventory through December 31, 1999.
9. The preparation of financial statements in conformity
with generally accepted accounting principles requires that management make
estimates and assumptions which affect the reported amounts of assets and
liabilities as at the date of the financial statements and revenues and expenses
for the period reported. Actual results may differ from these estimates.
10. The Company's Statement of Cash Flows is reported
utilizing cash (currency on hand and demand deposits) and cash equivalents
(short-term, highly liquid investments). The Company's Statement of Cash Flows
is reported utilizing the indirect method of reporting cash flows.
Schedule of noncash financing activities
Loan canceled in exchange for stock 7,500.00
Services received in exchange for common stock 45,562.00
Note receivable for common stock 5,000.00
---------
58,062.00
11. The Company will review its long-lived assets and
certain identifiable intangible assets for impairment at the end of each
operating period reported. The Company will report these assets at recoverable
costs.
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using the generally
accepted accounting principles applicable to a going concern, which contemplates
the realization of assets and liquidation of liabilities in the normal course of
business. However, the Company has not generated any revenues from its planned
principal operations through December 31, 1999. Without realization of
additional capital, it would be unlikely for the Company to continue as a going
concern. It is management's plan to secure additional capital through loans and
or private placements.
-8-
<PAGE>
Stemcell Global Research, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
NOTE 4 - RELATED PARTY TRANSACTION
Office services are provided without charge by a director. Such costs are
immaterial to the financial statements and, accordingly, have not been reflected
therein. The officers and directors of the Company are involved in other
business activities and may, in the future, become involved in other business
opportunities. If a specific business opportunity becomes available, such
persons may face a conflict in selecting between the Company and their other
business interests. The Company has not formulated a policy for the resolution
of such conflicts.
NOTE 5 - WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any additional
shares of common stock.
NOTE 6 - YEAR 2000 ISSUE
The Year 2000 issue arises because many computerized systems use two digits
rather than four to identify a year. Date-sensitive systems may recognize the
year 2000 as 1900 or some other date, resulting in errors when information using
year 2000 dates is processed. In addition, similar problems may arise in systems
which use certain dates in 1999 to represent something other than a date. The
effects of the Year 2000 issue may be experienced before on, or after January 1,
2000 and if not addressed, the impact on operations and financial reporting may
range from minor errors to significant systems failure which could affect an
entity's ability to conduct normal business operations. It is not possible to
be certain that all aspects of the Year 2000 issue affecting the entity,
including those related to the efforts of customers, suppliers, or other third
parties will be fully resolved.
NOTE 7 - LONG TERM COMMITMENTS
The Company neither owns or leases any real or personal property.
NOTE 8-CONVERTIBLE NOTES PAYABLE
The Company has issued $122,500.00 in convertible notes payable by
September 25, 1999. $42,000 of which was paid back during the period at 12% per
annum. The notes have a ninety day term which may be automatically renewed by
the Company. The note is convertible at the Holder's option at the price of
$.50 per share, the fair market value of the Company's 504 offering, with demand
registration rights and first right of refusal to sell these shares into the
Company's first secondary public offering. The notes are not with a related
party. The Company also agrees to issue an additional 50,000 shares to the
maker of the note, ninety days after the final advance of funds scheduled on
March 22, 2000. The conversion rate is based on the fair market value of the
Company's common stock at the time the notes were negotiated.
**END FINANCIAL STATEMENTS.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
None - Not applicable.
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act.
A. Directors, Executive Officers and Significant Employees
The names, ages and positions of the Company's directors and executive
officers are as follows:
Name Age Position
---- --- --------
Garrell C. Noah, MD 69 President and CEO
David A. Leytze, MBA 62 Vice President
Thomas G. Koch, DC 42 Vice President of Research,
Secretary and Treasurer
B. Work Experience
Garrell C. Noah, MD, President and CEO - Dr. Noah is a urologic surgeon
that was educated at the University of Alabama (1955) and Emory University
School of Medicine (1959). He has practiced medicine and surgery in Selma,
Alabama for the past 35 years.
David A. Leytze, MBA, Vice President - Mr. Leytze graduated cum laude
from Georgetown University, Washington DC majoring in Economics and Philosophy;
graduated from the University of Chicago Graduate School of Business (MBA)
majoring in Economics and Finance; Account Executive, Merrill Lynch; built,
owned and operated the Western Hills Indoor Tennis Club in Cincinnati (taught
Pete Rose how to play tennis); operates David A. Leytze and Co. Investment
Advisors (managing personal, corporate and retirement funds of approximately $25
million USD). Mr. Leytze has extensive investment banking background in small
capitalization finance. Currently, Mr. Leytze teaches Money and Banking,
Corporate Finance and Investments at the College of Mount Saint Joseph in
Cincinnati.
Thomas G. Koch, DC, Vice President of Research - Dr. Koch has served
the Company since inception. He is a graduate of Palmer College with a Bachelors
of Science and a Doctorate of Chiropractic medicine. Dr. Koch is a certified
Videofluroscopy Technician with ten years in private practice in the Seattle, WA
area. Dr. Koch is a noted and published medical research specialist and formerly
served as Founder and Vice President of Pacific Northwest Health Services.
C. Family Relationships
None - Not applicable.
D. Involvement on Certain Material Legal Proceedings During the Last Five
Years
(1) No director, officer, significant employee or consultant has been convicted
in a criminal proceeding, exclusive of traffic violations.
(2) No director, officer, or significant employee has been permanently or
temporarily enjoined, barred, suspended or otherwise limited from involvement in
any type of business, securities or banking activities.
(3) No director, officer or significant employee has been convicted of violating
a federal or state securities or commodities law
ITEM 10. EXECUTIVE COMPENSATION.
Remuneration of Directors and Executive Officers
The Company does not currently have employment agreements with its
executive officers but expects to sign employment agreements with each in the
next approximately six (6) months. All executive officers of the Company prior
to March 31, 2000 did not draw a formal salary from the Company. Over the next
twelve months, however, each executive officer is expected to draw the following
annual compensation. The Company does not currently have a stock option plan.
<TABLE>
<CAPTION>
(1) Name of Individual Capacities in Which Annual
or Identity of Group Remuneration was Recorded Compensation
<S> <C> <C>
Garrell C. Noah, MD President and CEO $12,000
David A. Leytze, MBA Vice President $12,000
Thomas G. Koch, DC Secretary and Treasurer $ -
(2) Compensation of Directors
</TABLE>
There were no arrangements pursuant to which any director of the
Company was compensated for the period from January 20, 1999 to March 31, 2000
for any service provided as a director. In addition, no such arrangement is
contemplated for the foreseeable future as the Company's only directors are its
current executive officers who are already drawing a salary for the management
of the Company.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
A. Security Ownership of Management and Certain Beneficial Owners
The following table sets forth information as of the date of this
Registration Statement certain information with respect to the beneficial
ownership of the Common Stock of the Company concerning stock ownership by (i)
each director, (ii) each executive officer, (iii) the directors and officers of
the Company as a group, (iv) and each person known by the Company to own
beneficially more than five percent (5%) of the Common Stock. Unless otherwise
indicated, the owners have sole voting and investment power with respect to
their respective shares.
<TABLE>
<CAPTION>
Amount
Title Name and Address of shares Percent
of of Beneficial held by of
Class Owner of Shares Position Owner Class
------ -------------------- ---------- ----------- -------
<S> <C> <C> <C> <C>
Common Garrell Noah, MD President & CEO 200,000 10.39%
Common Thomas Koch (custodian for
Christjohn Koch and
Kelsey Koch) Sec./Treas. 200,000 10.39%
Common Pennie Hoskins N/A 200,000 10.39%
Common Kenneth Koch N/A 200,000 10.39%
Common Stuart and Susan
Mount, JTWROS N/A 200,000 10.39%
Common Marche Trust N/A 175,000 9.09%
Common David A. Leytze Vice President 10,000 0.52%
Common All Executive Officers and
Directors as a Group (3 Persons) 410,000 21.31%
(1) c/o Stemcell Global Research, Inc., 9978 Washington Street, Camp Dennison,
Ohio 45111.
</TABLE>
B. Persons Sharing Ownership of Control of Shares
No person other than Garrell Noah, Thomas Koch (as trustee for
Christjohn Koch and Kelsey Koch), Pennie Hoskins, Kenneth Koch, and Stuart and
Susan Mount JTWROS owns or shares the power to vote ten percent (10%) or more of
the Company's securities.
C. Non-voting Securities and Principal Holders Thereof
The Company has not issued any non-voting securities.
D. Options, Warrants and Rights
There are no options, warrants or rights to purchase securities of the
Company.
E. Parents of the Issuer
Under the definition of parent, as including any person or business
entity who controls substantially all (more than 80%) of the issuers of common
stock, the Company has no parents.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Because of the development stage nature of the Company and its
relatively recent inception, January 20, 1999, the Company has no relationships
or transactions to disclose.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.
A. Exhibits
Exhibit No. Document Location
3(i) Articles of Incorporation Incorporated herein by reference
3(ii) Bylaws Incorporated herein by reference
23 Consent of Accountant See Item 7, Financial Statements
B. Reports on Form 8-K.
None - not applicable.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
Stemcell Global Research, Inc.
--------------------------------------------------------------------------------
(Registrant)
Date: August 7, 2000
------------
By: /s/ Dr. Garrell Noah
--------------------
Dr. Garrell Noah, Chairman of the Board, President and Chief Executive
Officer
----------------------------------------------------------------------
By: /s/ David Leytze
--------------------
David Leytze, Director, Vice President, CFO, Secretary/Treasurer
----------------------------------------------------------------
