NOTE
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Bio-Matrix
Scientific Group, Inc. (“Company”) was organized October 6, 1998, under the laws of the State of Delaware as Tasco
International, Inc.
From
October 6, 1998 to June 3, 2006 its activities have been limited to capital formation, organization, and development of its business
plan to provide production of visual content and other digital media, including still media, 360-degree images, video, animation
and audio for the Internet.
On
July 3, 2006 the Company abandoned its efforts in the field of digital media production when it acquired 100% of the share capital
of Bio-Matrix Scientific Group, Inc., a Nevada corporation, (“BMSG”) for consideration consisting of 10,000,000 shares
of the common stock of the Company and the cancellation of 10,000,000 shares of the Company owned and held by John Lauring.
As
a result of this transaction, the former stockholder of BMSG held approximately 80% of the voting capital stock of the Company
immediately after the transaction. For financial accounting purposes, this acquisition was a reverse acquisition of the Company
by BMSG under the purchase method of accounting, and was treated as a recapitalization with BMSG as the acquirer. Accordingly,
the financial statements have been prepared to give retroactive effect to August 2, 2005 (date of inception), of the reverse acquisition
completed on July 3, 2006, and represent the operations of BMSG.
Through
its controlled subsidiary, Regen BioPharma, Inc., the Company intends to engage primarily in the development of regenerative medical
applications which we intend to license from other entities up to the point of successful completion of Phase I and or Phase II
clinical trials after which we would either attempt to sell or license those developed applications or, alternatively, advance
the application further to Phase III clinical trials. As of December 31, 2015 The Company holds 15.6% of the equity and 65.7%
of the voting power of Regen BioPharma, Inc. (“Regen”)
A.
BASIS OF ACCOUNTING
The
financial statements have been prepared using the basis of accounting generally accepted in the United States of America. Under
this basis of accounting, revenues are recorded as earned and expenses are recorded at the time liabilities are incurred. The
Company has adopted a September 30 year-end.
B.
PRINCIPLES OF CONSOLIDATION
The
consolidated financial statements include the accounts of Bio-Matrix Scientific Group, inc., a Delaware corporation, Bio Matrix
Scientific Group, Inc, a Nevada corporation and a wholly owned subsidiary (“BMSG”), Regen BioPharma, Inc., a Nevada
corporation and controlled subsidiary (Regen) and Entest BioMedical, Inc., (“Entest”), a Nevada corporation which
was a majority owned subsidiary up to February 3, 2011. Significant inter-company transactions have been eliminated.
C.
USE OF ESTIMATES
The
preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. All estimates
are of a normal, recurring nature and are required for the fair presentation of the financial statements. Actual results could
differ from those estimates.
D.
CASH EQUIVALENTS
The
Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.
E.
PROPERTY AND EQUIPMENT
Property
and equipment are recorded at cost. Maintenance and repairs are expensed in the year in which they are incurred. Expenditures
that enhance the value of property and equipment are capitalized.
F.
FAIR VALUE OF FINANCIAL INSTRUMENTS
Fair
value is the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal
or most advantageous market in an orderly transaction between market participants on the measurement date. A fair value
hierarchy requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels
of inputs required by the standard that the Company uses to measure fair value:
Level
1: Quoted prices in active markets for identical assets or liabilities
Level
2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in
markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially
the full term of the related assets or liabilities.
Level
3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of
the assets or liabilities.
The
Company’s financial instruments as of December 31, 2015 consisted of Securities Available for Sale consisting of 8,066,667
common shares of Entest Biomedical, Inc and a Note Receivable from Entest Biomedical, Inc. for $12,051 . The fair value
of Securities Available for sale as of December 31, 2015 were valued according to the Level 1 input. The carrying amount of the
financial instruments is equal to the fair value as determined by the Company. The fair value of the Note Receivable was valued
according to Level 3 input.
G.
INCOME TAXES
The
Company accounts for income taxes using the liability method prescribed by ASC 740, “Income Taxes.” Under this method,
deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets
and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The
Company records a valuation allowance to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not
that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates
is recognized as income or loss in the period that includes the enactment date.
The
Company applied the provisions of ASC 740-10-50, “Accounting For Uncertainty In Income Taxes”, which provides clarification
related to the process associated with accounting for uncertain tax positions recognized in our financial statements. Audit periods
remain open for review until the statute of limitations has passed. The completion of review or the expiration of the statute
of limitations for a given audit period could result in an adjustment to the Company’s liability for income taxes. Any such
adjustment could be material to the Company’s results of operations for any given quarterly or annual period based, in part,
upon the results of operations for the given period. As of December 31 , 2015 the Company had no uncertain tax positions, and
will continue to evaluate for uncertain positions in the future.
The
Company generated a deferred tax credit through net operating loss carry forward. However, a valuation allowance of 100%
has been established.
Interest
and penalties on tax deficiencies recognized in accordance with ACS accounting standards are classified as income taxes in accordance
with ASC Topic 740-10-50-19.
H.
BASIC EARNINGS (LOSS) PER SHARE
The
Financial Accounting Standards Board (FASB) issued Accounting Standards Codification (ASC) 260, "Earnings Per Share",
which specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly
held common stock. ASC 260 requires the presentation of basic earnings (loss) per share and diluted earnings (loss) per share.
The Company has adopted the provisions of ASC 260 effective from inception.
Basic
net loss per share amounts is computed by dividing the net income by the weighted average number of common shares outstanding.
All options and convertible debt outstanding has an anti-dilutive effect on the EPS, therefore Diluted Earnings per Share are
the same as basic earnings per share.
I.
ADVERTISING
Costs
associated with advertising are charged to expense as incurred. Advertising expenses were $0 and $0 for the quarters ended December
31, 2015 and December 31, 2014.
J.
REVENUE RECOGNITION
Sales
of products and related costs of products sold are recognized when: (i) persuasive evidence of an arrangement exists; (ii) delivery
has occurred; (iii) the price is fixed or determinable; and (iv) collectability is reasonably assured. These terms are typically
met upon the prepayment or invoicing and shipment of products.
The
Company determines the amount and timing of royalty revenue based on its contractual agreements with intellectual property licensees.
The Company recognizes royalty revenue when earned under the terms of the agreements and when the Company considers realization
of payment to be probable. Where royalties are based on a percentage of licensee sales of royalty-bearing products, the Company
recognizes royalty revenue by applying this percentage to the Company’s estimate of applicable licensee sales. The Company
bases this estimate on an analysis of each licensee’s sales results. Where warranted, revenue from licensees for contractual
obligations such as License Initiation Fees are recognized upon satisfaction of all conditions required to be satisfied in order
for that revenue to have been earned by the Company.
NOTE
2
.
RECENT ACCOUNTING PRONOUNCEMENTS
In
June 2014, the Financial Accounting Standards Board issued Accounting Standards Update No. 2014-10, which eliminated certain financial
reporting requirements of companies previously identified as "Development Stage Entities" (Topic 915). The amendments
in this ASU simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities.
The amendments also reduce data maintenance and, for those entities subject to audit, audit costs by eliminating the requirement
for development stage entities to present inception-to-date information in the statements of income, cash flows, and shareholder
equity. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the
entity's financial statements have not yet been issued (public business entities) or made available for issuance (other entities).
Upon adoption, entities will no longer present or disclose any information required by Topic 915. The Company has adopted this
standard.
The
following accounting standards updates were recently issued and have not yet been adopted by us. These standards are currently
under review to determine their impact on our consolidated financial position, results of operations, or cash flows.
In
May 2014, FASB issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers. The revenue recognition
standard affects all entities that have contracts with customers, except for certain items. The new revenue recognition standard
eliminates the transaction-and industry-specific revenue recognition guidance under current GAAP and replaces it with a principle-based
approach for determining revenue recognition. Public entities are required to adopt the revenue recognition standard for reporting
periods beginning after December 15, 2016, and interim and annual reporting periods thereafter. Early adoption is not permitted
for public entities. The Company has reviewed the applicable ASU and has not, at the current time, quantified the effects of this
pronouncement, however it believes that there will be no material effect on the consolidated financial statements.
In
June 2014, FASB issued Accounting Standards Update (ASU) No. 2014-12 Compensation — Stock Compensation (Topic 718), Accounting
for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service
Period. A performance target in a share-based payment that affects vesting and that could be achieved after the requisite service
period should be accounted for as a performance condition under Accounting Standards Codification (ASC) 718, Compensation —
Stock Compensation. As a result, the target is not reflected in the estimation of the award's grant date fair value. Compensation
cost would be recognized over the required service period, if it is probable that the performance condition will be achieved.
The guidance is effective for annual periods beginning after 15 December 2015 and interim periods within those annual periods.
Early adoption is permitted. The Company has reviewed the applicable ASU and has not, at the current time, quantified the effects
of this pronouncement, however it believes that there will be no material effect on the consolidated financial statements.
In
August 2014, FASB issued Accounting Standards Update (ASU) No. 2014-15 Preparation of Financial Statements – Going Concern
(Subtopic 205-40), Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern. Under generally accepted
accounting principles (GAAP), continuation of a reporting entity as a going concern is presumed as the basis for preparing financial
statements unless and until the entity's liquidation becomes imminent. Preparation of financial statements under this presumption
is commonly referred to as the going concern basis of accounting. If and when an entity's liquidation becomes imminent, financial
statements should be prepared under the liquidation basis of accounting in accordance with Subtopic 205-30, Presentation of Financial
Statements—Liquidation Basis of Accounting. Even when an entity's liquidation is not imminent, there may be conditions or
events that raise substantial doubt about the entity's ability to continue as a going concern. In those situations, financial
statements should continue to be prepared under the going concern basis of accounting, but the amendments in this Update should
be followed to determine whether to disclose information about the relevant conditions and events. The amendments in this Update
are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early
application is permitted. The Company will evaluate the going concern considerations in this ASU, however, at the current period,
management does not believe that it has met the conditions which would subject these financial statements for additional disclosure.
On
January 31, 2013, the FASB issued Accounting Standards Update [ASU] 2013-01, entitled Clarifying the Scope of Disclosures about
Offsetting Assets and Liabilities. The guidance in ASU 2013-01 amends the requirements in the FASB Accounting Standards Codification
[FASB ASC] Topic 210, entitled Balance Sheet. The ASU 2013-01 amendments to FASB ASC 210 clarify that ordinary trade receivables
and receivables in general are not within the scope of ASU 2011-11, entitled Disclosure about Offsetting Assets and Liabilities,
where that ASU amended the guidance in FASB ASC 210. As those disclosures now are modified with the ASU 2013-01 amendments, the
FASB ASC 210 balance sheet offsetting disclosures now clearly are applicable only where reporting entities are involved with bifurcated
embedded derivatives, repurchase agreements, reverse repurchase agreements, and securities borrowing and lending transactions
that either are offset using the FASB ASC 210 or 815 requirements, or that are subject to enforceable master netting arrangements
or similar agreements. ASU 2013-01 is effective for annual reporting periods beginning on or after January 1, 2013, and interim
periods within those annual periods. The adoption of this ASU is not expected to have a material impact on our financial statements.
On
February 28, 2013, the FASB issued Accounting Standards Update [ASU] 2013-04, entitled Obligations Resulting from Joint and Several
Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date. The ASU 2013-04 amendments
add to the guidance in FASB Accounting Standards Codification [FASB ASC] Topic 405, entitled Liabilities and require reporting
entities to measure obligations resulting from certain joint and several liability arrangements where the total amount of the
obligation is fixed as of the reporting date, as the sum of the following:
The
amount the reporting entity agreed to pay on the basis of its arrangement among co-obligors.
Any
additional amounts the reporting entity expects to pay on behalf of its co-obligors.
While
early adoption of the amended guidance is permitted, for public companies, the guidance is required to be implemented in fiscal
years, and interim periods within those years, beginning after December 15, 2013. The amendments need to be implemented retrospectively
to all prior periods presented for obligations resulting from joint and several liability arrangements that exist at the beginning
of the year of adoption. The adoption of ASU 2013-04 is not expected to have a material effect on the Company’s operating
results or financial position.
On
April 22, 2013, the FASB issued Accounting Standards Update [ASU] 2013-07, entitled Liquidation Basis of Accounting. With ASU
2013-07, the FASB amends the guidance in the FASB Accounting Standards Codification [FASB ASC] Topic 205, entitled Presentation
of Financial Statements. The amendments serve to clarify when and how reporting entities should apply the liquidation basis of
accounting. The guidance is applicable to all reporting entities, whether they are public or private companies or not-for-profit
entities. The guidance also provides principles for the recognition of assets and liabilities and disclosures, as well as related
financial statement presentation requirements. The requirements in ASU 2013-07 are effective for annual reporting periods beginning
after December 15, 2013, and interim reporting periods within those annual periods. Reporting entities are required to apply the
requirements in ASU 2013-07 prospectively from the day that liquidation becomes imminent. Early adoption is permitted. The adoption
of ASU 2013-07 is not expected to have a material effect on the Company’s operating results or financial position.
A
variety of proposed or otherwise potential accounting standards are currently under study by standard setting organizations and
various regulatory agencies. Due to the tentative and preliminary nature of those proposed standards, the Company’s
management has not determined whether implementation of such standards would be material to its financial statements.
NOTE
3. OPTIONS AND WARRANTS
As
of December 31, 2015 the Company has no options or warrants outstanding.
NOTE
4. GOING CONCERN
The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Exclusive of
a onetime non-cash gain of $41,645,688 recognized upon the deconsolidation of Entest Biomedical, Inc., the Company generated net
losses of $33,468,578 (excluding $663,649 of Equity in Net Losses of Entest Biomedical, Inc. recognized) during the period
from August 2, 2005 (inception) through December 31, 2015. This condition raises substantial doubt about the Company's ability
to continue as a going concern. The Company's continuation as a going concern is dependent on its ability to meet its obligations,
to obtain additional financing as may be required and ultimately to attain profitability. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
Management
plans to raise additional funds by offering securities for cash. . During the quarter ended December 31, 2015 Regen raised $560,000
through the issuance of equity securities for cash.
NOTE
5. INCOME TAXES
As
of December 31, 2015
Deferred
tax assets:
|
|
|
|
|
Net
operating tax carry forwards
|
|
$
|
11,379,317
|
|
Other
|
|
|
-0-
|
|
Gross
deferred tax assets
|
|
|
11,379,317
|
|
Valuation
allowance
|
|
|
(11,379,317
|
)
|
|
|
|
|
|
Net
deferred tax assets
|
|
$
|
-0-
|
|
As
of December 31, 2015 the Company has a Deferred Tax Asset of $11,379,317 completely attributable to net operating
loss carry forwards of approximately $33,468,578 ( which expire 20 years from the date the loss was incurred) consisting
of
(a)
$38,616, of Net Operating Loss Carry forwards acquired in the reverse acquisition of BMSG and
(b)
$33,429,962 attributable to Bio-Matrix Scientific Group, Inc. a Delaware corporation, BMSG and Regen.
Realization
of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences
and carry forwards are expected to be available to reduce taxable income. The achievement of required future taxable income is
uncertain. In addition, the reverse acquisition of BMSG has resulted in a change of control. Internal Revenue Code Sec 382 limits
the amount of income that may be offset by net operating loss (NOL) carryovers after an ownership change. As a result, the Company
has the Company recorded a valuation allowance reducing all deferred tax assets to 0.
Income
tax is calculated at the 34% Federal Corporate Rate.
NOTE
6. RELATED PARTY TRANSACTIONS
As
of December 31, 2015 the Company is indebted to David Koos, the Company’s Chairman and Chief Executive Officer, in the amount
of $87,986. These loans and any accrued interest are due and payable at the demand of Mr. Koos and bear simple interest at the
rate of 15% per annum.
As
of December 31, 2015 Regen is indebted to David Koos, the Company’s Chairman and Chief Executive Officer, in the amount
of $50. These loans and any accrued interest are due and payable at the demand of Mr. Koos and bear simple interest at the rate
of 15% per annum.
The
Company utilizes approximately 2,300 square feet of office space at 4700 Spring Street, Suite 304, La Mesa California, 91941 subleased
to Regen by Entest BioMedical, Inc. on a month to month basis beginning October 1, 2014. The Chief Executive Officer of Entest
Biomedical Inc. is David R. Koos who also serves as the Chief Executive Officer of the Company. The sublease is on a month to
month basis and rent payable to Entest Biomedical, Inc. by Regen Biopharma Inc is equal to $5,000 per month,
As
of December 31, 2015 Entest Biomedical, Inc. is indebted to Regen in the amount of $12,051. $12,051 lent by Regen to Entest Biomedical,
Inc . is due and payable at the demand of the holder and bear simple interest at a rate of 10% per annum.
On
June 23, 2015 Regen Biopharma, Inc. entered into an agreement (“Agreement”) with Zander Therapeutics, Inc. ( “Zander”)
whereby Regen Biopharma, Inc. granted to Zander an exclusive worldwide right and license for the development and commercialization
of certain intellectual property controlled by Regen Biopharma, Inc. (“ License IP”) for non-human veterinary therapeutic
use for a term of fifteen years. Zander is a wholly owned subsidiary of Entest Biomedical, Inc.
Pursuant
to the Agreement, Zander shall pay to Regen Biopharma, Inc. one-time, non-refundable, upfront payment of one hundred thousand
US dollars ($100,000) as a license initiation fee which must be paid within 90 days of June 23, 2015 and an annual non-refundable
payment of one hundred thousand US dollars ($100,000) on the first anniversary of the effective date of the Agreement and each
subsequent anniversary.
The
abovementioned payments may be made, at Zander’s discretion, in cash or newly issued common stock of Zander or in common
stock of Entest BioMedical Inc. valued as of the lowest closing price on the principal exchange upon which said common stock trades
publicly within the 14 trading days prior to issuance.
Pursuant
to the Agreement, Zander shall pay to Regen Biopharma, Inc. royalties equal to four percent (4%) of the Net Sales , as such term
is defined in the Agreement, of any Licensed Products, as such term is defined in the Agreement, in a Quarter.
Pursuant
to the Agreement, Zander will pay Regen Biopharma, Inc. ten percent (10%) of all consideration (in the case of in-kind consideration,
at fair market value as monetary consideration) received by Zander from sublicensees ( excluding royalties from sublicensees based
on Net Sales of any Licensed Products for which Regen Biopharma, Inc. receives payment pursuant to the terms and conditions of
the Agreement).
Zander
is obligated pay to Regen Biopharma, Inc. minimum annual royalties of ten thousand US dollars ($10,000) payable per year on each
anniversary of the Effective Date of this Agreement, commencing on the second anniversary of June 23, 2015. This minimum annual
royalty is only payable to the extent that royalty payments made during the preceding 12-month period do not exceed ten thousand
US dollars ($10,000).
The
Agreement may be terminated by Regen Biopharma, Inc.:
If
Zander has not sold any Licensed Product by ten years of the effective date of the Agreement or Zander has not sold any Licensed
Product for any twelve (12) month period after Zander’s first commercial sale of a Licensed Product.
The
Agreement may be terminated by Zander with regard to any of the License IP if by five years from the date of execution of the
Agreement a patent has not been granted by the United States patent and Trademark Office to Regen Biopharma, Inc. with regard
to that License IP.
The
Agreement may be terminated by Zander with regard to any of the License IP if a patent that has been granted by the United States
patent and Trademark Office to Regen Biopharma, Inc. with regard to that License IP is terminated.
The
Agreement may be terminated by either party in the event of a material breach by the other party.
On
September 28, 2015 Zander caused to be issued to Regen Biopharma, Inc. 8,000,000 of the common shares of Entest Biomedical, Inc
in satisfaction of one hundred thousand US dollars ($100,000) to be paid to Regen Biopharma, Inc. by Zander as a license initiation
fee. Regen Biopharma, Inc. recognized revenue of $192,000 equivalent to the fair value of 8,000,000 of the common shares of Entest
Biomedical, Inc as of the date of issuance.
David
R. Koos serves as sole officer and director of both Zander and Entest Biomedical, Inc. and also serves as Chairman and Chief Executive
Officer of Regen Biopharma, Inc..
NOTE
7. NOTES PAYABLE AND CONVERTIBLE NOTES PAYABLE
AND NOTES RECEIVABLE
|
|
|
December
31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
Bio
Technology Partners Business Trust (Company)
|
|
$
|
14,000
|
|
Bio
Technology Partners Business Trust (Regen)
|
|
$
|
49,000
|
|
David
R. Koos ( Company)( Note 6)
|
|
$
|
87,986
|
|
David
R. Koos ( Regen)( Note 6)
|
|
$
|
50
|
|
The
Sherman family Trust
|
|
$
|
2,000
|
|
Bostonia
Partners ( Company)
|
|
$
|
75,000
|
|
Bostonia
Partners ( Regen)
|
|
$
|
119,000
|
|
Total
|
|
$
|
347,036
|
|
Amounts
due to the Biotechnology Partners Business Trust. are due and payable at the demand of the holder and bear simple interest
at a rate of 10% per annum.
All
loans to the Company and Regen made by David R. Koos are due and payable at the demand of Koos and bear simple interest at a rate
of 15% per annum.
All
amounts due to the Sherman Family Trust bear no interest and are due and payable, in whole or in part, at the option of the holder.
$60,000
lent to Regen Biopharma, Inc. by Bostonia Partners is due and payable September 16, 2016 and bear simple interest at a rate of
10% per annum
$59,000
lent to Regen Biopharma, Inc. by Bostonia Partners is due and payable September 22, 2016 and bear simple interest at a rate of
10% per annum.
$40,000
lent to the Company by Bostonia Partners is due and payable September 2, 2016 and bear simple interest at a rate of 10% per annum.
$35,000
lent to the Company by Bostonia Partners is due and payable December 14, 2016 and bear simple interest at a rate of 10% per annum.
|
Convertible
Notes 12/31/2015
|
|
|
|
|
|
|
|
|
|
50,000
|
|
|
Scott
Levine
|
|
10,000
|
|
|
Mike
and Ofie Weiner
|
|
18,400
|
|
|
Mike
and Ofie Weiner
|
|
2,301
|
|
|
Bio
Technology Partners Business Trust
|
|
206,780
|
|
|
Star
City Capital, LLC
|
$
|
287,481
|
|
|
Total
|
$206,780
due and payable to Starcity Capital LLC (“Note”) bears no interest, is payable on April1, 2016 and permits conversion
at the Holder’s option into common shares of the Company under the following terms and conditions:
The
Holder of the Note is entitled, at its option, at any time after 180 days after March 27, 2015 to convert all or any amount of
the principal face amount of this Note then outstanding into shares of the Company's common stock (the "Common Stock")
at a price ("Conversion Price") for each share of Common Stock equal to the greater of
(iii)
fifty five percent (55%) (the "Discount'') of the lowest closing bid price for the Company's common stock during the five
(5) trading days immediately preceding a conversion date, as reported by Bloomberg (the "Closing Bid Price") ("Initial
Conversion Price") or
(iv)
$0.0001.
Upon
:
(i)
a transfer of all or substantially all of the assets of the Company to any person in a single transaction or series of related
transactions,
(ii)
a reclassification, capital reorganization or other change or exchange of outstanding shares of the Common Stock, or
(iii)
any consolidation or merger of the Company with or into another person or entity in which the Company is not the surviving entity
(other than a merger which is effected solely to change the jurisdiction of incorporation of the Company and results in a reclassification,
conversion or exchange of outstanding shares of Common Stock solely into shares of Common Stock)
then,
in each case, Holder may convert the unpaid principal amount of this Note into shares of Common Stock immediately prior to such
event at the Conversion Price.
other
than as provided in (i), (ii) and(ii) above, the Holder shall not have the right to convert its debt into shares which, when added
to such Holder’s other holdings in the Company stock, shall have caused such Holder to hold more than 9.99% of the Company’s
outstanding common stock.
The
issuance of the Note amounted in a beneficial conversion feature of $300,000 which is amortized under the Interest Method over
the life of the Note.
The
amount by which the instrument’s as converted value exceeds the principal amount as of December 31, 2015 is $357,165.
$50,000
due and payable to Scott Levine bears simple interest at 12% per annum and is convertible into common shares of the company at
$0.15 per share. The instrument became due and payable on November 14, 2009. No demand for payment has been made.
$10,000
due and payable to Mike and Ofie Weiner bears simple interest at 12% per annum and is convertible into common shares of the company
at $0.15 per share. The instrument became due and payable on March 3 , 2010. No demand for payment has been made.
$18,400
due and payable to Mike and Ofie Weiner bears simple interest at 12% per annum and is convertible into common shares of the company
at $0.15 per share. The instrument became due and payable on December 28, 2009. No demand for payment has been made.
$2,301
due and payable to Bio Technology Partners Business Trust bears simple interest at 12% per annum and is convertible into common
shares of the company at $0.15 per share. The instrument became due and payable on November 26, 2009. No demand for payment has
been made.
As
of December 31, 2015 the unamortized discount on convertible notes outstanding is $ 75,815.
NOTES
RECEIVABLE
|
|
December
31, 2015
|
Entest
Biomedical, Inc. (Note 6)
|
|
$
|
12,051
|
|
|
|
|
|
|
Notes
Receivable
|
|
$
|
12,051
|
|
$12,051
lent by Regen Biopharma, Inc. to Entest Biomedical, Inc. is due and payable at the demand of the holder and bear simple interest
at a rate of 10% per annum.
NOTE
8. STOCKHOLDERS' EQUITY
The
stockholders' equity section of the Company contains the following classes of capital stock as of December 31, 2015:
Preferred
stock, $0.0001 par value; 20,000,000 shares authorized:
2,063,821 Preferred
Shares, par value $0.0001, issued and outstanding.
With
respect to each matter submitted to a vote of stockholders of the Corporation, each holder of Preferred Stock shall be entitled
to cast that number of votes which is equivalent to the number of shares of Series B Preferred Stock owned by such holder times
one (1).
On
any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, the holders of the Preferred Stock shall
receive, out of assets legally available for distribution to the Company's stockholders, a ratable share in the assets of the
Corporation.
94,852
Series AA Preferred Shares, par value $0.0001, issued and outstanding.
With
respect to each matter submitted to a vote of stockholders of the Corporation, each holder of Series AA Preferred Stock shall
be entitled to cast that number of votes which is equivalent to the number of shares of Series AA Preferred Stock owned by such
holder times ten thousand (10,0000).
On
any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, the holders of the Series AA Preferred
Stock shall receive, out of assets legally available for distribution to the Company's stockholders, a ratable share in the assets
of the Corporation.
40,000
Series AAA Preferred Shares, par value $0.0001, issued and outstanding.
With
respect to each matter submitted to a vote of stockholders of the Corporation, each holder of Series AA Preferred Stock shall
be entitled to cast that number of votes which is equivalent to the number of shares of Series AA Preferred Stock owned by such
holder times one hundred thousand (100,0000).
On
any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, the holders of the Series AA Preferred
Stock shall receive, out of assets legally available for distribution to the Company's stockholders, a ratable share in the assets
of the Corporation.
725,409
Series B Preferred Shares, Par Value $0.0001, issued and outstanding.
With
respect to each matter submitted to a vote of stockholders of the Corporation, each holder of Series B Preferred Stock shall be
entitled to cast that number of votes which is equivalent to the number of shares of Series B Preferred Stock owned by such holder
times two (2).
On
any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, the holders of the Series B Preferred
Stock shall receive, out of assets legally available for distribution to the Company's stockholders, a ratable share in the assets
of the Corporation.
Non
Voting Convertible Preferred Stock, $1.00 Par value, 200,000 shares authorized, 0 shares issued and outstanding
Each
Non Voting Convertible Preferred Stock shall convert at the option of the holder into shares of the corporation’s common
stock at a conversion price equal to seventy percent (70%) of the lowest Closing Price for the five (5) trading days immediately
preceding written receipt by the corporation of the holder’s intent to convert.
“CLOSING
PRICE" shall mean the closing bid price for the corporation’s common stock on the Principal Market on a Trading Day
as reported by Bloomberg Finance L.P.
“PRINCIPAL
MARKET" shall mean the principal trading exchange or market for the corporation’s common stock.
“TRADING
DAY” shall mean a day on which the Principal Market shall be open for business.
On
any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, the holders of the Non Voting Convertible
Preferred shall receive, out of assets legally available for distribution to the Company's stockholders, a ratable share in the
assets of the Corporation.
Common
stock, $ 0.0001 par value; 8,000,000,000 shares authorized: 4,889,065,929 shares issued and outstanding.
With
respect to each matter submitted to a vote of stockholders of the Corporation, each holder of Common Stock shall be entitled to
cast that number of votes which is equivalent to the number of shares of Common Stock owned by such holder times one (1).
NOTE
9. COMMITMENTS AND CONTINGENCIES
On
April 12, 2013 a complaint (Complaint) was filed in the U.S. District Court Southern District of the State of new York against
the Company, the Company’s Chairman and Does 1-50 by Star city Capital, LLC (“Plaintiff”) alleging securities
fraud, common law fraud, negligent misrepresentation, breach of fiduciary duties and breach of contract in connection with the
issuance of. The Plaintiff is also request declaratory relief from the Court.
The
action arises from the issuance and subsequent cancellation of 103,030,303 of the company’s common shares in satisfaction
of $17,000 of convertible indebtedness of the Company held by the Plaintiff. The Plaintiff alleges that a cancellation notice
sent by them to the Company’s transfer agent was meant to instruct the Transfer Agent simply to cancel the physical certificate
in order that an equivalent number of shares may be transferred via DWAC to the Plaintiff’s stockbroker for the benefit
of the Plaintiff. DWAC is the acronym for Deposit/Withdrawal At Custodian. The DWAC transaction system run by The Depository Trust
Company (a.k.a. DTC or CEDE & CO) permits brokers and custodial banks, the DTC participants, to request the movement of shares
to or from the issuer’s transfer agent electronically. A DWAC results in the crediting or debiting of shares to or from
DTC’s book-entry account on the records of the issuer maintained by the transfer agent.
The
Company believes that the cancellation notice sent by the Plaintiff clearly represents a cancellation of the conversion notice
itself.
The
convertible indebtedness held by the Plaintiff was convertible at Holder’s demand into the common shares of the Company’s
stock at a conversion price per share equal to 55% (the “Discount”) of the lowest closing bid price for the Company’s
common stock during the 5 trading days immediately preceding a conversion date, as reported by Bloomberg (the “Closing Bid
Price”); provided that if the closing bid price for the common stock on the date in which the conversion shares are deposited
into Holder’s brokerage account and confirmation has been received that Holder may execute trades of the conversion shares
( Clearing Date) is lower than the Closing Bid Price, then the purchase price for the conversion shares would be adjusted such
that the Discount shall be taken from the closing bid price on the Clearing Date, and the Company shall issue additional shares
to Purchaser to reflect such adjusted Purchase Price(“Reset”). The Company and the Plaintiff had agreed on a limitation
on conversion equal to 9.99% of the Company’s outstanding common stock.
On
February 2, 2015 Plaintiff and the Company entered into a Settlement Agreement and Mutual General Release to fully and finally
resolve the aforementioned legal action pursuant to the following terms and conditions:
|
(a)
|
Within
seven business days of the Company’s transfer agent’s receipt of an appropriate opinion of counsel, the Company
shall deliver to Starcity or its designee or assignee (which designation or assignment shall be provided in writing) via DWAC,
103,030,303 of the common shares of the Company , it being the agreement of the parties that such issuance shall constitute
full and complete satisfaction of $17,000 due to Starcity by the Company.
|
|
(b)
|
The
Company shall deliver to Starcity a non interest bearing Convertible Note in the face amount of $300,000 (“Note”)
due and payable April 1, 2016.
|
The
Holder of this Note is entitled, at its option, at any time after 180 days after the date that consideration of $52,500 is paid
to the Company to convert all or any amount of the principal face amount of this Note then outstanding into shares of the Company's
common stock (the "Common Stock") at a price ("Conversion Price") for each share of Common Stock equal to
the greater of
|
(i)
|
fifty
five percent (55%) (the "Discount'') of the lowest closing bid price for the Company's common stock during the five (5)
trading days immediately preceding a conversion date, as reported by Bloomberg (the "Closing Bid Price") ("Initial
Conversion Price") or
|
Other
than as provided in 5(p) of the Note ), the Holder shall not have the right to convert its debt into shares which, when added
to such Holder’s other holdings in the Company stock, shall have caused such Holder to hold more than to hold more than
9.99% of the Company's outstanding common stock. Section 5(p) of the Note states that:
Upon
:
(i)
a transfer of all or substantially all of the assets of the Company to any person in a single transaction or series of related
transactions,
(ii)
a reclassification, capital reorganization or other change or exchange of outstanding shares of the Common Stock, or
(iii)
any consolidation or merger of the Company with or into another person or entity in which the Company is not the surviving entity
(other than a merger which is effected solely to change the jurisdiction of incorporation of the Company and results in a reclassification,
conversion or exchange of outstanding shares of Common Stock solely into shares of Common Stock)
then,
in each case, Holder may convert the unpaid principal amount of this Note into shares of Common Stock immediately prior to such
event at the Conversion Price.
In
the event that Starcity fails to fund the Note by making a payment of $52,500 to the Company on or before April 1, 2015, the Company’s
obligations under this Note shall be terminated, cancelled and relinquished.
On
August 21, 2012 the Company entered into a settlement funding agreement with Princeton Research, Inc. and Jan Vandersande (collectively
the “PRI Parties”) which obligates the Company to pay the PRI Parties $1,000 a month over thirty months.
The
Company utilizes approximately 2,300 square feet of office space at 4700 Spring Street, Suite 304, La Mesa California, 91941 subleased
to Regen Biopharma, Inc. by Entest BioMedical, Inc. on a month to month basis beginning October 1, 2014. The Chief Executive Officer
of Entest Biomedical Inc. is David R. Koos who also serves as the Chief Executive Officer of Regen and the Company. The sublease
is on a month to month basis and rent payable to Entest Biomedical, Inc. by Regen Biopharma Inc is equal to $5,000 per month.
NOTE
10. INVESTMENT SECURITIES
As
of the quarter ending September 30, 2012 the Company reclassified 66,667 (retroactively adjusted for reverse stock split.) common
shares of Entest Biomedical, Inc. as Securities Available for Sale from Securities Accounted for under the Equity Method.
On
September 28, 2015 Zander Theraputics, Inc. caused to be issued to Regen Biopharma, Inc. 8,000,000 of the common shares of Entest
Biomedical, Inc in satisfaction of one hundred thousand US dollars ($100,000) to be paid to Regen Biopharma, Inc. by Zander Theraputics,
Inc as a license initiation fee.
The
common shares of Entest Biomedical, Inc described above constitute the Company’s sole investment securities as of December
31, 2015.
Subsequent
to the original issuance of the Company’s annual consolidated financial statements, the Company determined that:
An
other than temporary impairment of $41,333,361 on 8,066,667 Common Shares of Entest Biomedical, Inc. owned by the Company should
be recognized as of September 30, 2015 due to the following factors:
|
(a)
|
History
of recurring losses for Entest Biomedical, Inc.
|
|
(b)
|
Large
percentage decline in fair value during the Company’s period of ownership
|
|
8,066,667
|
|
|
Common
Shares of Entest Biomedical, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basis
|
|
|
|
Fair
Value
|
|
|
|
Total
Unrealized Losses in Other Comprehensive Income
|
|
|
|
Net
Unrealized Gain or (Loss) realized during the quarter ended December 31, 2015
|
|
|
41,528,361
|
|
|
|
121,000
|
|
|
|
(74,000)
|
|
|
|
(38,720)
|
|
NOTE
11. STOCK TRANSACTIONS
BIO-
MATRIX SCIENTIFIC GROUP, INC.:
On
October 2, 2016 the Company issued 382,657,778 of its Common Shares in satisfaction of $63,138 of convertible indebtedness.
On
December 15, 2015 the Company issued 273,476,806 of its Common Shares in satisfaction of $30,082 of convertible indebtedness.
REGEN
BIOPHARMA, INC.
Common
Stock
On
October 28, 2015 Regen issued 3,333,334 of its Common Shares for cash consideration of $166,667.
On
November 20, 2015 Regen issued 2,200,000 of its Common Shares for cash consideration of $55,000.
On
December 29, 2015 Regen issued 4,000,000 of its Common Shares for cash consideration of $100,000.
Series
A Preferred Stock
On
October 28, 2015 Regen issued 1,666,667 shares of its Series A Preferred stock for cash consideration of $83,333.
On
October 28, 2015 Regen issued 11,000,000 shares of its Series A Preferred stock to Dr. Harry Lander, Regen’s President and
Chief Scientific Officer, pursuant to the terms and conditions of that employment agreement entered into by and between Dr. Lander
and Regen dated October 9, 2015.
On
November 20, 2015 Regen issued 2,200,000 shares of its Series A Preferred stock for cash consideration of $55,000.
On
November 20, 2015 Regen issued 400,000 shares of its Series A Preferred stock as consideration for nonemployee services.
On
December 29, 2015 Regen issued 4,000,000 shares of its Series A Preferred stock for cash consideration of $100,000.
NOTE
12. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
Subsequent
to the original issuance of the Company’s annual consolidated financial statements, the Company determined that:
An
other than temporary impairment of $41,333,361 on 8,066,667 Common Shares of Entest Biomedical, Inc. owned by the Company should
be recognized as of September 30, 2015 due to the following factors:
|
(c)
|
History
of recurring losses for Entest Biomedical, Inc.
|
|
(d)
|
Large
percentage decline in fair value during the Company’s period of ownership
|
The
line Items
“Increase in
Additional
Paid in Capital” and “Loss on Settlement of Debt through Equity issuance” are to be categorized as “Adjustments
to reconcile net Income to net cash (used in) provided by operating activities” in the Company’s statement of cash
flow.
The
following tables reflect the corrections:
BIOMATRIX
SCIENTIFIC GROUP, INC.
|
|
|
|
|
CONSOLIDATED
BALANCE SHEET
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
of December 31, 2015
|
Adjustments
|
|
As
of December 31 2015
|
|
|
|
|
|
(as
originally presented)
|
|
|
(
restated)
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
|
|
|
193,386
|
|
|
|
|
193,386
|
|
|
|
|
Prepaid
Expenses
|
|
|
16,000
|
|
|
|
|
16,000
|
|
|
|
|
Note
Receivable
|
|
|
12,051
|
|
|
|
|
12,051
|
|
|
|
|
Interest
Receivable
|
|
|
1,681
|
|
|
|
|
1,681
|
|
|
|
|
Due
from Former Subsidiary Employee
|
|
|
15,000
|
|
|
|
|
15,000
|
|
|
|
|
Total
Current Assets
|
|
|
238,118
|
|
|
|
|
238,118
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
4,200
|
|
|
|
|
4,200
|
|
|
|
|
Available
for Sale Securities
|
|
|
121,000
|
|
|
|
|
121,000
|
|
|
|
|
Total
Other Assets
|
|
|
125,200
|
|
|
|
|
125,200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
|
363,318
|
|
|
|
|
363,318
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
Payable
|
|
|
169,769
|
|
|
|
|
169,769
|
|
|
|
|
Notes
Payable
|
|
|
347,036
|
|
|
|
|
347,036
|
|
|
|
|
Bank
Overdraft
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
Accrued
Payroll
|
|
|
784,757
|
|
|
|
|
784,757
|
|
|
|
|
Accrued
Payroll Taxes
|
|
|
48,316
|
|
|
|
|
48,316
|
|
|
|
|
Accrued
Interest
|
|
|
337,721
|
|
|
|
|
337,721
|
|
|
|
|
Accrued
Rent
|
|
|
10,000
|
|
|
|
|
10,000
|
|
|
|
|
Accrued
Expenses
|
|
|
5,000
|
|
|
|
|
5,000
|
|
|
|
|
Convertible
Note Payable Net of Unamortized Discount
|
|
|
211,675
|
|
|
|
|
211,675
|
|
|
|
|
Due
to Affiliate
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
Due
to Subsidiary Shareholder
|
|
|
50,000
|
|
|
|
|
50,000
|
|
|
|
|
Current
portion, note payable to affiliated party
|
|
|
1,000
|
|
|
|
|
1,000
|
|
|
|
|
Total
Current Liabilities
|
|
|
1,965,274
|
|
|
|
|
1,965,274
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Liabilities
|
|
|
1,965,274
|
|
|
|
|
1,965,274
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
Stock ($.0001 par value) 20,000,000 shares authorized; 20,000,000 shares authorized; 2,063,821 issues and outstanding
as December 31, 2015
|
|
|
207
|
|
|
|
|
207
|
|
|
|
|
Series
AA Preferred ($0.0001 par value) 100,000 shares authorized 94,852 issued and outstanding December 31, 2015
|
|
|
9
|
|
|
|
|
9
|
|
|
|
|
Series
AAA Preferred ($0.0001 par value) 1,000,000 shares authorized 40,000 shares issued and outstanding as December 31, 2015
|
|
|
4
|
|
|
|
|
4
|
|
|
|
|
Series
B Preferred Shares ($.0001 par value) 2,000,000 shares authorized; 725,409 issued and outstanding as of December 31, 2015
|
|
|
73
|
|
|
|
|
73
|
|
|
|
|
Common
Stock ($.0001 par value) 8,000,000,000 shares authorized and4,889,065,929 shares issued and outstanding as of December 31,
2015
|
|
|
488,905
|
|
|
|
|
488,905
|
|
|
|
|
Non
Voting Convertible Preferred Stock ($1 Par value) 200,000 shares authorized; 0 shares issued and outstanding as
of December 31, 2015
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
Additional
Paid in capital
|
|
|
31,059,493
|
|
|
|
|
31,059,493
|
|
|
|
|
Contributed
Capital
|
|
|
509,355
|
|
|
|
|
509,355
|
|
|
|
|
Retained
Earnings (Deficit)
|
|
|
7,552,077
|
|
(41,333,361)
|
|
|
(33,781,284)
|
|
|
|
|
Accumulated
Other Comprehensive Income (Loss)
|
|
|
(41,407,361
|
)
|
41,333,361
|
|
|
(74,000)
|
|
|
|
|
Total
Stockholders' Equity (Deficit) Biomatrix Scientific Group, Inc.
|
|
|
(1,797,238
|
)
|
|
|
|
(1,797,238
|
|
|
|
|
Noncontrolling
Interest in subsidiary
|
|
|
195,283
|
|
|
|
|
195,283
|
|
|
|
|
Total
Stockholders' Equity
|
|
|
(1,601,955
|
)
|
|
|
|
(1,601,955
|
|
|
|
|
TOTAL
LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
363,318
|
|
|
|
|
363,318
|
|
|
|
|
BIOMATRIX
SCIENTIFIC GROUP, INC.
|
|
|
|
|
|
CONSOLIDATED
BALANCE SHEET
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
of September 30, 2015
|
|
Adjustments
|
As
of September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
originally Reported
|
|
|
Restated
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
|
|
|
76,355
|
|
|
|
|
76,355
|
|
|
|
|
|
Prepaid
Expenses
|
|
|
25,000
|
|
|
|
|
25,000
|
|
|
|
|
|
Note
Receivable
|
|
|
12,051
|
|
|
|
|
12,051
|
|
|
|
|
|
Interest
Receivable
|
|
|
1,381
|
|
|
|
|
1,381
|
|
|
|
|
|
Total
Current Assets
|
|
|
114,787
|
|
|
|
|
114,787
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
|
4,200
|
|
|
|
|
4,200
|
|
|
|
|
|
Available
for Sale Securities
|
|
|
159,720
|
|
|
|
|
159,720
|
|
|
|
|
|
Total
Other Assets
|
|
|
163,920
|
|
|
|
|
163,920
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
|
278,707
|
|
|
|
|
278,707
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
Payable
|
|
|
167,977
|
|
|
|
|
167,977
|
|
|
|
|
|
Notes
Payable
|
|
|
400,336
|
|
|
|
|
400,336
|
|
|
|
|
|
Bank
Overdraft
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
|
Accrued
Payroll
|
|
|
738,095
|
|
|
|
|
738,095
|
|
|
|
|
|
Accrued
Payroll Taxes
|
|
|
44,485
|
|
|
|
|
44,485
|
|
|
|
|
|
Accrued
Interest
|
|
|
324,750
|
|
|
|
|
324,750
|
|
|
|
|
|
Accrued
Rent
|
|
|
10,000
|
|
|
|
|
10,000
|
|
|
|
|
|
Accrued
Expenses
|
|
|
5,000
|
|
|
|
|
5,000
|
|
|
|
|
|
Convertible
Note Payable Net of Unamortized Discount
|
|
|
231,507
|
|
|
|
|
231,507
|
|
|
|
|
|
Due
to Affiliate
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
|
Due
to Subsidiary Shareholder
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
|
Current
portion, note payable to affiliated party
|
|
|
1,000
|
|
|
|
|
1,000
|
|
|
|
|
|
Total
Current Liabilities
|
|
|
1,923,150
|
|
|
|
|
1,923,150
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
Stock ($.0001 par value) 20,000,000 shares authorized;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000,000
shares authorized; 2063821 issues and outstanding as of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30 2015
|
|
|
207
|
|
|
|
|
207
|
|
|
|
|
|
Series
AA Preferred ($0.0001 par value) 100,000 shares authorized
|
|
|
|
|
|
|
|
|
|
|
|
|
|
94,852
issued and outstanding as of September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9
|
|
|
|
|
9
|
|
|
|
|
|
Series
AAA Preferred ($0.0001 par value) 1,000,000 shares authorized
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,000
shares issued and outstanding as of September 30, 2015
|
|
|
4
|
|
|
|
|
4
|
|
|
|
|
|
Series
B Preferred Shares ($.0001 par value) 2,000,000 shares authorized;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
725,409
issued and outstanding as of and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,2015
|
|
|
73
|
|
|
|
|
73
|
|
|
|
|
|
Common
Stock ($.0001 par value) 5,000,000,000 shares authorized;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,232,931,345
issued and outstanding as of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
2015
|
|
|
423,292
|
|
|
|
|
423,292
|
|
|
|
|
|
Non
Voting Convertible Preferred Stock ($1 Par value)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
200,000
shares authorized; 0 shares issued and outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
as
of September 30, 2015
|
|
|
0
|
|
|
|
|
0
|
|
|
|
|
|
Additional
Paid in capital
|
|
|
29,004,809
|
|
|
|
|
29,004,809
|
|
|
|
|
|
Contributed
Capital
|
|
|
509,355
|
|
|
|
|
509,355
|
|
|
|
|
|
Retained
Earnings (Deficit)
|
|
|
9,704,398
|
|
|
|
(41,333,361)
|
(31,628,963)
|
|
|
|
|
|
Accumulated
Other Comprehensive Income (Loss)
|
|
|
(41,368,641
|
)
|
|
|
41,333,361
|
(35,280)
|
|
|
|
|
|
Total
Stockholders' Equity (Deficit)Biomatrix Scientific Group, Inc.
|
|
|
(1,726,494
|
)
|
|
|
|
(1,726,494)
|
|
|
|
|
|
Noncontrolling
Interest in subsidiary
|
|
|
82,050
|
|
|
|
|
82,050
|
|
|
|
|
|
Total
Stockholders' Equity
|
|
|
(1,644,444
|
)
|
|
|
|
(1,644,444)
|
|
|
|
|
|
TOTAL
LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
278,707
|
|
|
|
|
278,707
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
|
Quarter
Ended
|
|
|
|
December
31, 2015
(as
originally presented)
|
|
|
December
31, 2015
(adjusted)
|
|
|
|
|
|
Adjustments
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income (loss)
|
|
|
(2,152,321
|
)
|
|
|
|
(2,152,321
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
to reconcile net Income to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
Subsidiary
Stock issued for services rendered by consultants
|
|
|
40
|
|
|
|
|
40
|
|
|
|
Interest
Expense attributable to amortization of discount
|
|
|
73,387
|
|
|
|
|
73,387
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
paid in Capital
|
|
|
|
|
|
247,722
|
|
247,722
|
|
|
Loss
on Settlement of Debt through Equity Issuance
|
|
|
|
|
|
1,332,547
|
|
1,332,547
|
|
|
Changes
in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
(Increase)
decrease in prepaid expenses
|
|
|
9,000
|
|
|
|
|
9,000
|
|
|
|
Increase
(Decrease) in Accounts Payable
|
|
|
1,792
|
|
|
|
|
1,792
|
|
|
|
Increase
(Decrease) in Accrued Expenses
|
|
|
63,464
|
|
|
|
|
63,464
|
|
|
|
Increase
(Decrease) in bank Overdraft
|
|
|
|
|
|
|
|
|
|
|
|
(Increase)
Decrease in Interest Receivable
|
|
|
(300
|
)
|
|
|
|
(300
|
)
|
|
|
(Increase)
Decrease in Due from Former Employee
|
|
|
(15,000
|
)
|
|
|
|
(15,000
|
)
|
|
|
Net
Cash Provided by (Used in) Operating Activities
|
|
|
(2,019,938
|
)
|
|
1,580,268
|
|
(439,670)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
Additional
paid in Capital
|
|
|
247,722
|
|
|
(247,722)
|
|
|
|
|
Increase
(Decrease) in due to subsidiary shareholder
|
|
|
50,000
|
|
|
|
|
50,000
|
|
|
Stock
in subsidiary sold for cash
|
|
|
560,001
|
|
|
|
|
560,001
|
|
|
Principal
borrowings (repayments) on notes and Convertible Debentures
|
|
|
(53,300
|
)
|
|
|
|
(53,300
|
)
|
|
Principal
borrowings ( repayments) on Convertible Debentures
|
|
|
0
|
|
|
|
|
0
|
|
|
(Increase)
Decrease in Deferred Financing Costs
|
|
|
0
|
|
|
|
|
0
|
|
|
Loss
on Settlement of Debt through Equity Issuance
|
|
|
1,332,547
|
|
|
(1,332,547)
|
|
|
|
|
Net
Cash Provided by (Used in) Financing Activities
|
|
|
2,136,970
|
|
|
(1,580,268)
|
|
556,701
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Increase (Decrease) in Cash
|
|
|
117,031
|
|
|
|
|
117,031
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
at Beginning of Period
|
|
|
76,355
|
|
|
|
|
76,355
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
at End of Period
|
|
|
193,386
|
|
|
|
|
193,386
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Disclosure of Noncash investing and financing activities:
|
|
|
|
|
|
|
|
|
|
|
Common
Shares Issued for Debt
|
|
$
|
93,220
|
|
|
|
$
|
93,220
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Quarter
Ended
|
|
|
December
31, 2014
|
|
December
31, 2014
|
|
|
(restated)
|
|
(as
originally presented)
|
CASH FLOWS FROM OPERATING
ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
(loss)
|
|
|
(856,892
|
)
|
|
|
(856,892
|
)
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile
net Income to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
Additional
paid in Capital
|
|
|
72,440
|
|
72,440
|
|
|
|
Loss
on Settlement of Debt through Equity Issuance
|
|
|
587,500
|
|
587,500
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
(Increase)
decrease in prepaid expenses
|
|
|
|
|
|
|
|
|
Increase
(Decrease) in Accounts Payable
|
|
|
(2,085
|
|
|
|
(2,085
|
)
|
Increase
(Decrease) in Accrued Expenses
|
|
|
43,219
|
|
|
|
43,219
|
|
Increase
(Decrease) in bank Overdraft
|
|
|
(6,137
|
|
|
|
(6,137
|
)
|
(Increase)
Decrease in Interest Receivable
|
|
|
(260
|
)
|
|
|
(260
|
)
|
(
|
|
|
|
|
|
|
|
|
Net Cash Provided
by (Used in) Operating Activities
|
|
|
(162215)
|
|
659940
|
|
(822,155
|
)
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING
ACTIVITIES
|
|
|
|
|
|
|
|
|
Additional
paid in Capital
|
|
|
|
|
(72440)
|
|
72,440
|
|
Increase
(Decrease) in due to subsidiary shareholder
|
|
|
20000
|
|
|
|
20,000
|
|
|
|
|
|
|
|
|
|
|
Principal
borrowings (repayments) on notes and Convertible Debentures
|
|
|
217,321
|
|
|
|
217,321
|
|
Principal
borrowings ( repayments) on Convertible Debentures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
on Settlement of Debt through Equity Issuance
|
|
|
|
|
(587,500)
|
|
587,500
|
|
Net Cash Provided
by (Used in) Financing Activities
|
|
|
237321
|
|
(659,940)
|
|
897,261
|
|
|
|
|
|
|
|
|
|
|
Net Increase (Decrease)
in Cash
|
|
|
75,106
|
|
|
|
75,106
|
|
|
|
|
|
|
|
|
|
|
Cash at Beginning
of Period
|
|
|
502
|
|
|
|
502
|
|
|
|
|
|
|
|
|
|
|
Cash at End of Period
|
|
|
75,608
|
|
|
|
75,608
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosure
of Noncash investing and financing activities:
|
|
|
|
|
|
|
|
|
Common
Shares Issued for Debt
|
|
$
|
117,500
|
|
|
$
|
117,500
|
|
|
|
|
|
|
|
|
|
|
The
Accompanying Notes are an Integral Part of These Financial Statements
|