ENTEST GROUP, INC. - Annual Report: 2018 (Form 10-K)
United States Securities and Exchange Commission
Washington, D.C. 20549
Form 10-K
☒ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934:
For the fiscal year ending August 31, 2018
☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934: For the transition period from ___________ to ___________.
Commission file number: 333-154989
ENTEST GROUP, INC.
(Name of small business issuer in its charter)
| Nevada | 26-3431263 | |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
4700 Spring Street, Suite 304, La Mesa, California, 91942
(Address of Principal executive offices)
Issuer’s telephone number: ( 619) 702-1404
_______________
Securities registered under Section 12(b) of the “Exchange Act” None
Securities registered under Section 12(g) of the Exchange Act: None
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes ☒ No ☐
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not 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-K or any amendment to this Form 10-K
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or smaller reporting company.
| Large accelerated filer ☐ | Accelerated filer ☐ |
| Non accelerated filer ☐ | Smaller reporting Company ☒ |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes ☐ No☐
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, as of the last business day of the registrant’s most recently completed second fiscal quarter: $ 470,842
As of November 16, 2018 Entest BioMedical, Inc. had 49,170,472 common shares outstanding, 728, 009 Series B Preferred shares outstanding , 667 Series AA preferred shares outstanding , 534 Series AAA preferred shares outstanding and 1001533 shares outstanding of the Company’s Non Voting Convertible Preferred Stock. .
| 1 |
In this annual report, the terms “Entest BioMedical, Inc.. ”, “Entest”, “Company”, “we”, or “our”, unless the context otherwise requires, mean Entest BioMedical, Inc., a Nevada corporation, and its subsidiaries.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This annual report on Form 10-K and other reports that we file with the SEC contain statements that are considered forward-looking statements. Forward-looking statements give the Company’s current expectations, plans, objectives, assumptions or forecasts of future events. All statements other than statements of current or historical fact contained in this annual report, including statements regarding the Company’s future financial position, business strategy, budgets, projected costs and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “estimate,” “plans,” “potential,” “projects,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend,” and similar expressions. These statements are based on the Company’s current plans and are subject to risks and uncertainties, and as such the Company’s actual future activities and results of operations may be materially different from those set forth in the forward looking statements. Any or all of the forward-looking statements in this annual report may turn out to be inaccurate and as such, you should not place undue reliance on these forward-looking statements. The Company has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy and financial needs. The forward-looking statements can be affected by inaccurate assumptions or by known or unknown risks, uncertainties and assumptions due to a number of factors.
These forward-looking statements speak only as of the date on which they are made, and except to the extent required by federal securities laws, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements contained in this annual report.
PART I
Item 1. Business
We were incorporated in the State of Nevada on September 24, 2008 as JB Clothing Corporation. Until July 10, 2009, our principal business objective was the offering of active/leisure fashion design clothing.
On July 10, 2009 we abandoned our efforts in the field of active/leisure fashion design clothing when we acquired 100% of the share capital of Entest BioMedical, Inc., a California corporation, (“Entest CA”) from Bio-Matrix Scientific Group, Inc. (“BMSN”) 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 Mr. Rick Plote.
As a result of this transaction, the former stockholder of Entest CA held approximately 70% 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 Entest CA under the purchase method of accounting, and was treated as a recapitalization with Entest CA as the acquirer..
Upon acquisition of Entest CA, we abandoned our efforts in the field of active/leisure fashion design clothing. On July 12, 2009 we adopted the name of Entest CA when we changed our name to Entest BioMedical, Inc. On June 18, 2015 Entest established Zander Therapeutics, Inc., a then wholly owned subsidiary. Zander was established to engage primarily in the development and commercialization of veterinary medical therapies which we intend to license from other entities as well as develop internally
| 2 |
The Company changed its name to Entest Group, Inc. on February 12, 2018.
On May 5, 2018, The Company declared the distribution on a pro rata basis as a dividend in kind of 3,000,000 of the common shares of Zander Therapeutics, Inc., par value $0.0001, currently owned by Entest Group, Inc. to:
(a) Holders of record of the outstanding common shares of the Company as of the record date, which is May 30, 2018.
(b) Holders of record of the shares of any outstanding series of the preferred shares of the Company as of the record date, which is May 30, 2018.
Shareholders of the Company shall receive one (1) common share of Zander Therapeutics, Inc. for each 17 common and/or preferred shares of the Company held as of the record date. The distribution of the 3,000,000 common shares of Zander Therapeutics, Inc. to the common and preferred shareholders of the Company occurred on June 11, 2018 ("Distribution Date").
As a result of the payment of the abovementioned property dividend, the Company’s percentage of ownership of Zander fell below 50% resulting in the deconsolidation of Zander as of the Distribution Date. As of the Distribution Date all assets and liabilities attributable to Zander were derecognized by the Company. The Company recognized a $10,034 gain as a result of the deconsolidation. The Property dividend may be deemed to have occurred with a related party as the recipients were shareholders of Entest, including the Chairman and Chief Executive Officer of Entest and Regen Biopharma, Inc. which is a company under common control with Entest.
The Company’s remaining share of Zander , which consists of 5,000,000 shares of Zander’s Series M Preferred Stock (“Zander M Stock”) is accounted for under the Equity Method as of the Distribution Date. The Zander M Stock is carried a Fair Value and the carrying value is increased by the Company’s proportionate share of earnings of Zander and decreased by cash dividends paid by Zander as well as the Company’s proportionate share of losses of Zander up to the carrying value . As of August 31, 2018 the carrying value of the Zander M Stock has been decreased by the Company’s proportionate share of the losses of Zander and is 0. As of August 31, 2018 Entest beneficially owns 34.82% of the share equity of Zander.
As of November 16, 2018 the Company is a “shell company” as that term is defined in Rule 12b-2 of the Securities and Exchange Act which is a registrant that has:
(1) No or nominal operations; and
(2) Either:
(i) No or nominal assets;
(ii) Assets consisting solely of cash and cash equivalents; or
(iii) Assets consisting of any amount of cash and cash equivalents and nominal other assets.
The Company's current business strategy is to acquire an operating company seeking the perceived advantages of being a publicly held corporation. No assurance can be given that such an acquisition shall occur or, if such an acquisition were to occur, it would occur on terms and conditions beneficial to the Company or its shareholders.
Distribution methods of the products or services:
Entest currently provides no product or service
| 3 |
Competitive business conditions and Entest's competitive position in the industry and methods of competition
The Company will face vast competition from other shell companies that desire to seek a potential business combination with a private company seeking the perceived advantages of being a publicly held corporation. The Company will be in a highly competitive market for a small number of business opportunities which could reduce the likelihood of consummating a successful business combination. A large number of established and well-financed entities, including small public companies and venture capital firms, are active in mergers and acquisitions of companies that may be desirable target candidates for us. Nearly all these entities have significantly greater financial resources, technical expertise and managerial capabilities than we do; consequently, we will be at a competitive disadvantage in identifying possible business opportunities and successfully completing a business combination. These competitive factors may reduce the likelihood of our identifying and consummating a successful business
combination.
Need for any government approval of principal products or services, effect of existing or probable governmental regulations on the business
The Company is unaware of any government approval currently required in order for the Company to complete an acquisition of an operating company. The Company is subject to federal and state securities laws.
Amount spent during the last fiscal year on research and development activities
During the fiscal year ended August 31, 2018 the consolidated Company expended $949,584 on research and development activities.
Costs and effects of compliance with environmental laws (federal, state and local);
Entest has not incurred any unusual or significant costs to remain in compliance with any environmental laws and does not expect to incur any unusual or significant costs to remain in compliance with any environmental laws in the foreseeable future.
Number of total employees and number of full-time employees
As of November 16, 2018, the Company has 1 employee of which 1 is partl time.
Sources and availability of raw materials and the names of principal suppliers
Entest currently has no need for raw materials or supplies
Patents, trademarks, licenses, franchises, concessions, royalty agreements or labor contracts, including duration.
Entest possesses no patents or trademarks. Entest has not been granted any license, franchise or concession. Entest is not party to any royalty agreement or labor contract.
Item 2. Properties
On November 1, 2011, the Company entered into an agreement to lease approximately 2,320 square feet of office space beginning December 1, 2011 for a period of five years.
Rent to be charged to the Company pursuant to the lease is as follows:
$2,996 per month for the period beginning December 1, 2011 and ending November 30, 2012
$3,116 per month for the period beginning December 1, 2012 and ending November 30, 2013
$3,241 per month for the period beginning December 1, 2013 and ending November 30, 2014
$3,371 per month for the period beginning December 1, 2014 and ending November 30, 2015
$3,506 per month for the period beginning December 1, 2015 and ending November 30, 2016
| 4 |
On November 27, 2016 the lease was extended until November 30, 2021
Rent to be charged to the Company pursuant to the extension is as follows:
$2,996 per month for the period beginning December 1, 2016 and ending November 30, 2017
$3,116 per month for the period beginning December 1, 2017 and ending November 30, 2018
$3,241 per month for the period beginning December 1, 2018 and ending November 30, 2019
$3,371 per month for the period beginning December 1, 2019 and ending November 30, 2020
$3,506 per month for the period beginning December 1, 2020 and ending November 30, 2021
This property is utilized as office space. The Company believes that the foregoing property is adequate to meet its current needs.
Item 3. Legal Proceedings
None
Item 4. Submission of Matters to a Vote of Security Holders
No matter was 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 Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
The Company’s common stock is a "penny stock," as defined in Rule 3a51-1 under the Exchange Act. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its sales person in the transaction, and monthly account statements showing the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that the broker-dealer, not otherwise exempt from such rules, must make a special written determination that the penny stock is suitable for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure rules have the effect of reducing the level of trading activity in the secondary market for a stock that becomes subject to the penny stock rules. So long as the common stock of the Company is subject to the penny stock rules, it may be more difficult to sell common stock of the Company.
The Company’s authorized capital stock consists of 500,000,000 shares of common stock with a par value $0.0001, and 5,000,000 shares of preferred stock with a par value $0.0001 per share (of which 100,000 are designated as Series AA Preferred Stock, 4,400,000 are designated as Series B Preferred Stock and 300,000 are designated as Series AAA Preferred Stock) and 3,000,000 shares authorized of Non Voting Convertible Preferred Stock, par value $1.00 . As of November 16,2018 Entest BioMedical, Inc. had 49,170,472 common shares outstanding, 728, 009 Series B Preferred shares outstanding , 667 Series AA preferred shares outstanding, 534 Series AAA preferred shares outstanding, and 1001533 shares of the Company’s Non Voting Convertible Preferred Stock outstanding.
| (a) | Our common stock is traded on the OTC Pink Tier of OTC Markets under the symbol "ETNI”. Below is the range of high and low price information for our common equity for each quarter within the last two fiscal years as reported by OTC Markets. |
| 5 |
| September 1, 2017 to August 31, 2018 | High | Low | ||||||
| First Quarter | $ | 0.0182 | $ | 0.0068 | ||||
| Second Quarter | 0.0205 | 0.0068 | ||||||
| Third Quarter | 0.0405 | 0.0092 | ||||||
| Fourth Quarter | $ | 0.054 | $ | 0.011 | ||||
| September 1, 2016 to August 31, 2017 | High | Low | ||||||
| First Quarter | $ | 0.0919 | $ | 0.0038 | ||||
| Second Quarter | 0.0559 | 0.02 | ||||||
| Third Quarter | 0.055 | 0.015 | ||||||
| Fourth Quarter | $ | 0.0201 | $ | 0.045 | ||||
Holders
As of August 31, 2018 there were approximately 40 holders of our Common Stock.
Dividends
No cash dividends were paid during the fiscal year ending August 31, 2018. We do not expect to declare cash dividends in the immediate future.
Recent Sales of Unregistered Securities
On September 8, 2017 the Company issued 2,500,000 Common Shares (“Shares”)in connection with a conversion of 25,000 Non Voting Convertible Preferred Shares.
The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended (the “Act”). No underwriters were retained to serve as placement agents for the sale. The shares were sold directly through our management. No commission or other consideration was paid in connection with the sale of the shares. There was no advertisement or general solicitation made in connection with this Offer and Sale of Shares. A legend was placed on the certificate that evidences the Shares stating that the Shares have not been registered under the Act and setting forth or referring to the restrictions on transferability and sale of the Shares.
Item 6. Selected Financial Data
As we are a “smaller reporting company” as defined by Rule 229.10(f)(1), we are not required to provide the information required by this Item.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
As of August 31, 2017, we had Cash in the amount of $86,559 and as of August 31, 2018 we had Cash in the amount of $267.
The decrease in Cash of approximately 99.7% is primarily attributable to the derecognition of the assets of Zander Therapeutics, Inc. which was deconsolidated from the Company on June 11, 2018.
As of August 31, 2017 we had Accrued Interest Receivable of $908 and as of August 31 2018 we had Accrued Interest Receivable of $1,040.
The increase in Accrued Interest Receivable of approximately 14.2% is attributable to $132 of interest earned by the Company during the quarter ended February 28, 2018 resulting from a short term loan made by the Company, the principal on such loan paid during the quarter ended February 28, 2018.
As of August 31, 2017 we had Prepaid Expenses of $58,652 and as of the end of the same period ended 2018 we had Prepaid Expenses of $8,000.
The decrease in Prepaid Expenses of approximately 86.3% is primarily attributable to $50,652 of fees prepaid to consultants during the fiscal year ended 2017.
| 6 |
As of August 31, 2017 we had Securities Available for Sale in the amount of $190,050 and as of August 31, 2018 we had Securities Available for Sale in the amount of $0.
The decrease in Securities Available for Sale is attributable to the sale by the Company of 3,500,000 of the Series A Preferred shares of Regen Biopharma, Inc.to Zander Therapeutics, Inc.
David R. Koos, the Chairman and Chief Executive Officer of the Company, serves in the same capacity at Regen Biopharma, Inc. and Zander Therapeutics, Inc.
As of August 31, 2017 we had Notes Payable of $13,501 and as of August 31, 2018 we had Notes Payable of $19,601.
The increase in Notes Payable of approximately 45.1% is attributable to the incurrence of an additional $2,500 of principal indebtedness from the Company’s Chairman and incurrence of an additional $3,600 of principal indebtedness from an entity controlled by the Company’s Chairman.
As of August 31, 2017 we had Accrued Expenses of $269,398 and as of August 31, 2018 we had Accrued Expenses of $181,904.
The reduction in accrued expenses of approximately 32.4% is primarily attributable to payment during the year ended August 31, 2018 of $88,000 of salary accrued but unpaid to David R. Koos, the Company’s sole officer as well as derecognition of $818 of accrued interest during the year ended August 31 2018 attributable to the deconsolidation of Zander Therapeutics, Inc. offset by interest accrued but unpaid due on Notes payable.
As of August 31, 2018 we had Unearned Rental Income of $17,000 and as of August 31, 2017 we had Unearned Rental Income of $0.
The increase in Unearned Rental Income is attributable to rental income prepaid to the Company by Regen Biopharma, Inc. Regen Biopharma, Inc. is under common control with the Company.
As of August 31, 2018 we had a bank overdraft of $66 and as of August 31, 2017 we had a bank overdraft of $0.
The increase in bank overdraft is attributable to withdrawals of $66 in excess of the balance of a bank account maintained by the Company.
Revenues from continuing operations were $0 for the year ended August 31, 2017 and -0- for the year ended August 31, 2018. Net Losses from continuing operations were $664,792 for the year ended August 31, 2017 and $1,477,484 for the same period ended 2018.
The increase in Net Loss of approximately 122.2% is primarily attributable to Research and Development Fees incurred by Zander Therapeutics, Inc. during that period of the fiscal year during which Zander Therapeutics, Inc. was a consolidated subsidiary of the Company and recognition of the Company’s equity in the losses of Zander Therapeutics, Inc. during the period beginning June 11, 2018 and ending August 31, 2018. These losses were offset by gains on sale of investment securities and a one time gain of $10,034 recognized in connection with the deconsolidation of Zander Therapeutics, Inc.
| 7 |
As of August 31, 2018 we had $267 cash on hand and current liabilities of $255,018 such liabilities consisting of Accounts Payable, Notes Payable, Amounts due to Others and Accrued Expenses.
We feel we will not be able to satisfy our cash requirements over the next twelve months. The Company seeks to acquire an operating company seeking the perceived advantages of being a publicly held corporation. No assurance can be given that such an acquisition shall occur or, if such an acquisition were to occur, it would occur on terms and conditions beneficial to the Company or its shareholders.
As of November 16, 2018 we are not party to any binding agreements which would commit Entest to any material capital expenditures.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
As we are a smaller reporting company, as defined by Rule 229.10(f)(1), we are not required to provide the information required by this Item.
| 8 |
Item 8. Financial Statements and Supplementary Data
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
Entest Group, Inc. (FKA Entest Biomedical, Inc.)
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Entest Group, Inc. (the “Company”) as of August 31, 2018 and August 31, 2017 and the related statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the two-year period ended August 31, 2018, and the related notes and schedules (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of August 31, 2018 and August 31, 2017, and the results of its operations and its cash flows for each of the years in the two-year period ended August 31, 2018 in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 4 to the financial statements, the Company has no revenues, has negative working capital at August 31, 2018, has incurred recurring losses and recurring negative cash flow from operating activities, and has an accumulated deficit which raises substantial doubt about its ability to continue as a going concern. Management’s plans concerning these matters are also described in Note 4. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ AMC Auditing
AMC
Auditing
We have served as the Company’s auditor since 2012
Las Vegas, Nevada
November 19, 2018
| 9 |
| ENTEST GROUP,INC. | ||||||||
| (Formerly called ENTEST BIOMEDICAL, INC.) | ||||||||
| Consolidated Balance Sheet | ||||||||
As of August 31, 2018 | August 31, 2017 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash | 267 | 86,559 | ||||||
| Accrued Interest Receivable | 1,040 | 908 | ||||||
| Current Portion of Prepaid Expenses | 8,000 | 58,652 | ||||||
| Accrued Rent Receivable | 0 | 0 | ||||||
| Total Current Assets | 9,307 | 146,119 | ||||||
| OTHER ASSETS | ||||||||
| Available for Sale Securities | 0 | 190,050 | ||||||
| Long Term Portion Prepaid Expenses | 0 | 0 | ||||||
| TOTAL ASSETS | 9,307 | 336,169 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current Liabilities | ||||||||
| Accounts Payable | 28,447 | 28,446 | ||||||
| Notes Payable | 19,601 | 13,501 | ||||||
| Due to Other | 8,000 | 8,000 | ||||||
| Unearned Rental Income | 17,000 | 0 | ||||||
| Bank Overdraft | 66 | 0 | ||||||
| Accrued Expenses | 181,904 | 269,398 | ||||||
| Total Current Liabilities | 255,018 | 319,345 | ||||||
| TOTAL LIABILITIES | 255,018 | 319,345 | ||||||
| STOCKHOLDERS' EQUITY | ||||||||
| Common Stock, authorized 500,000,000 shares as of August 31, 2017 and August 31, 2018; issued and outstanding 46,670,472(par value $0.0001) as of August 31, 2017 and 49,170,472 as of August 31, 2018 | 4,911 | 4,661 | ||||||
| Preferred Stock ,par value $0.0001 5,000,000 shares authorized, Series AA Preferred Stock, 100,000 shares authorized, 667 shares, par value $0.0001, issued and outstanding at August 31, 2017 and as of August 31, 2018 | 0 | 0 | ||||||
| Series B Preferred 4,400,000 shares authorized, 728,009 ( par value $0.0001) issued and outstanding as of August 31, 2018 and 728,009 issued and outstanding as of August 31, 2017 | 73 | 73 | ||||||
| Series AAA Preferred, 300,000 shares authorized, $0.0001 par value 534 shares outstanding as of August 31, 2018 and as of August 31, 2017 | ||||||||
| NonVoting Convertible Preferred ($1 par value) 3,000,000 shares authorized as of August 31, 2018 and August 31, 2017 respectively, 1,001,533 and 1,026,533 issued and outstanding as of August 31, 2018 and August 31, 2017, respectively | 1,001,533 | 1,026,533 | ||||||
| Additional Paid in Capital | 8,729,236 | 7,191,000 | ||||||
| Contributed Capital | 274,662 | 274,662 | ||||||
| Accumulated Deficit | (10,256,126 | ) | (8,721,498 | ) | ||||
| Accumulated Other Comprehensive Income | 0 | 185,050 | ||||||
| Total Stockholders' Equity Entest Biomedical, Inc. | (245,711 | ) | (39,519 | ) | ||||
| Non Controlling Interest Zander Therapeutics Inc. | 0 | 56,343 | ||||||
| Stockholders Equity | (245,711 | ) | 16,824 | |||||
| TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | 9,307 | 336,169 | ||||||
| The accompanying Notes are an integral part of these Financial Statements | ||||||||
| 10 |
| ENTEST GROUP,INC. | |||||||||
| (Formerly called ENTEST BIOMEDICAL, INC.) | |||||||||
| Consolidated Statement of Operations | |||||||||
| Year Ended | Year Ended | ||||||||
| August 31, 2018 | August 31 2017 | ||||||||
| TOTAL REVENUE | 0 | 0 | |||||||
| COSTS AND EXPENSES | |||||||||
| Research and Development | 949,584 | 124,770 | |||||||
| Rent Costs | 37,032 | 37,482 | |||||||
| General and Administrative | 224,263 | 225,804 | |||||||
| Consultant's Expenses | 310,020 | 263,823 | |||||||
| Total Costs and Expenses | 1,520,899 | 651,879 | |||||||
| OPERATING LOSS | (1,520,899 | ) | (651,879 | ) | |||||
| OTHER INCOME AND EXPENSE | |||||||||
| Rental income | 66,000 | 60,000 | |||||||
| Interest Income | 132 | 1,056 | |||||||
| Gain on Write Off of Accounts Payable | 76,697 | ||||||||
| Loss on Issuance of Stock Below Fair Value | (107,700 | ) | |||||||
| Gain on Deconsolidation of Zander | 10,034 | ||||||||
| Equity in Losses of Zander | (61,428 | ) | |||||||
| Gain on Sale of Securities | 30,000 | ||||||||
| Interest Expense | (1,323 | ) | (42,966 | ) | |||||
| TOTAL OTHER INCOME AND EXPENSE | 43,415 | (12,913 | ) | ||||||
| LOSS BEFORE INCOME TAXES | (1,477,484 | ) | (664,792 | ) | |||||
| Income Taxes | 0 | 0 | |||||||
| NET LOSS | |||||||||
| NET LOSS from continuing | (1,477,484 | ) | (664,792 | ) | |||||
| Operations | |||||||||
| Less: (Net Income) Loss attributable to non controlling interest in Zander Therapeutics, Inc. | 105,374 | ||||||||
| NET LOSS available to common shareholders | (1,477,484 | ) | (559,418 | ) | |||||
| BASIC AND DILUTED EARNINGS (LOSS) PER SHARE FROM CONTINUING OPERATIONS | (0.030 | ) | (0.013 | ) | |||||
| WEIGHTED AVERAGE NUMBER COMMON SHARES OUTSTANDING | 48987813 | 42551431 | |||||||
| The accompanying Notes are an integral part of these Financial Statements | |||||||||
| 11 |
| ENTEST GROUP, INC. | ||||||||
| (Formerly called ENTEST BIOMEDICAL, INC.) | ||||||||
| Consolidated Statement of Comprehensive Income | ||||||||
| Year Ended August 31, | Year Ended August 31, | |||||||
| 2018 | 2017 | |||||||
| Net Income (Loss) | $ | (1477484 | ) | $ | (664,792 | ) | ||
| Add: | ||||||||
| Unrealized Gains on Securities | 0 | 277,100 | ||||||
| Less: | ||||||||
| Unrealized Losses on Securities | 0 | (92,050 | ) | |||||
| Comprehensive Income attributable to Non Controlling Interest | 0 | 0 | ||||||
| Total Other Comprehensive Income (Loss) | 0 | 185,050 | ||||||
| Comprehensive Income | $ | (1477484 | ) | $ | (479,742 | ) | ||
| The accompanying Notes are an integral part of these Financial Statements | ||||||||
| 12 |
| Common | Series AA Preferred | Series AAA Preferred | Series B Preferred | Non Voting Convertible Preferred | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Additional Paid-in Capital | Contributed Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit during the Development Stage | Non Controlling interest In Subsidiary | Total | |||||||||||||||||||||||||||||||||||||||||||||||||
| Balance August 31, 2016 | 40,170,472 | 4,011 | 667 | 0 | 533 | 0 | 28,009 | 3 | 0 | 0 | 6,148,054 | 274,162 | 0 | (7,405,099 | ) | 0 | (978,869 | ) | ||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares issued to Consultant January 27, 2017 | 100000 | 10 | 4490 | 4,500 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares issued for debt February 7, 2017 | 1000000 | 100 | 9900 | 10,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares issued for debt February 10, 2017 | 2,000,000 | 200 | 19,800 | 20,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares issued to Consultant March 10, 2017 | 100000 | 10 | 4810 | 4,820 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Series B Preferred shares issued to consultant March 10, 2017 | 500000 | 50 | 50 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Series B Preferred shares issued to consultant March 10, 2017 | 100000 | 10 | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Series B Preferred shares issued to consultant March 31, 2017 | 100000 | 10 | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Stock Issued for Cash April 3, 2017 | 750000 | 75 | 14,925 | 15,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Stock of Subsidiary sold for Cash April 10, 2017 | 20,000 | 20,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares issued to Consultant May 30, 2017 | 100000 | 10 | 3,390 | 3,400 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued for Accrued Expenses May 30, 2017 | 83000 | 83000 | 83,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued for Debt May 30, 2017 | 840681 | 840681 | 840,681 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Beneficial Conversion Features recognized May 30, 2017 | 576,804 | 576,804 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Amortization of Beneficial Conversion Feature May 30, 2017 | (576,804 | ) | (576,804 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred Shares of Subsidiary issued to consultants June 20, 2017 | 100 | 100 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred Shares of Subsidiary issued to employees June 15, 2017 | 150 | 150 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares of Subsidiary issued for Cash July 10, 2017 | 100,000 | 100,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares of Subsidiary issued to Consultant 7/10/2017 | 50 | 50 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred Shares of Subsidiary Issued to Consultants July 10, 2017 | 10 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares issued to Consultants July 24, 2017 | 2450000 | 245 | 97,510 | 97,755 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares issued for Accrued Expenses July 24, 2017 | 102852 | 102852 | 102,852 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Beneficial Conversion Features recognized July 24, 2017 | 74,801 | 74,801 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Amortization of Beneficial Conversion Feature July 24, 2017 | (74,801 | ) | (74,801 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred Shares of Subsidiary Issued to Consultants August 21, 2017 | 140 | 140 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Restricted Stock Expense Recognized During the Year Ended August 31, 2017 | 64,709 | 64,709 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Accumulated Other Comprehensive Income Recognized During the Year Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| August 31, 2017 | 185050 | 185,050 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Loss on Issuance below Fair Value | 107,700 | 107,700 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Loss for the Year Ended August 31, 2017 | (664,792 | ) | (664,792 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Non Controlling Interest in Subsidiary | (56,343 | ) | 56343 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Increase in Contributed Capital Year Ended 8/31/2017 | 500 | 500 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance August 31, 2017 | 46,670,472 | 4,661 | 667 | 0 | 533 | 0 | 728,009 | 73 | 1,026,533 | 1,026,533 | 7,191,000 | 274,662 | 185050 | (8,721,498 | ) | 56343 | 16,824 | |||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares issued for NonVoting Convertible Preferred Shares September 8, 2017 | 2,500,000 | 250 | (25,000 | ) | (25,000 | ) | 24,750 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares of Subsidiary issued for Cash October 30, 2017 | 900,000 | 900,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares of Subsidiary issued for Cash February 5, 2018 | 200,000 | 200,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common Shares of Subsidiary issued for Cash February 27, 2018 | 300,000 | 300,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Declaration of property Dividend May 5, 2018 | (57,143 | ) | (57,143 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Payment of Property Dividend June 11, 2018 | 57,143 | 57,143 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Elimination of Noncontrolling Interest upon deconsolidation June 11, 2018 | 56,343 | (56,343 | ) | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Sale of Securities of Securities Available for Sale | (185,050 | ) | (185,050 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Loss For Year Ended August 31, 2018 | (1,477,484 | ) | (1,477,484 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balalnce August 31, 2018 | 49,170,472 | 4,911 | 667 | 0 | 533 | 0 | 728,009 | 73 | 1,001,533 | 1,001,533 | 8,729,236 | 274,662 | 0 | (10,256,126 | ) | 0 | (245,711 | ) | ||||||||||||||||||||||||||||||||||||||||||||||
| The accompanying Notes are an integral part of these Financial Statements | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 13 |
| ENTEST GROUP,INC. | ||||||||
| (Formerly called ENTEST BIOMEDICAL, INC.) | ||||||||
| Consolidated Statement of Cash Flow | ||||||||
| (unaudited) | ||||||||
| Year Ended | Year Ended | |||||||
| August 31, 2018 | August 31, 2017 | |||||||
| OPERATING ACTIVITIES | ||||||||
| Net (loss) | (1,477,484 | ) | (664,792 | ) | ||||
| Adjustments to reconcile net loss to net cash used by operating activities: | ||||||||
| Increase(Decrease) in stock of subsidiary issued to employees | 150 | |||||||
| Increase(Decrease) in stock of subsidiary issued to consultants | 300 | |||||||
| Increase (Decrease) in Additional paid in Capital | 0 | 64,709 | ||||||
| Increase ( Decrease) in Issuance of Stock below Faie Value | 0 | 107,700 | ||||||
| increase (Decrease) in Preferred Stock issued for expenses | 0 | 185,852 | ||||||
| Increase (Decrease) in Preferred Stock issued to Consultants | 70 | |||||||
| (Increase) Decrease in Gain attributable to Deconsolidation | (10,034 | ) | ||||||
| (Increase) Decrease Cash Lost in Deconsolidation | (332,638 | ) | ||||||
| Equity in Losses of Zander | 61,428 | |||||||
| Increase (Decrease) Common Stock issued to Consultants | 110,475 | |||||||
| Changes in Operating Assets and Liabilities | ||||||||
| (Increase) Decrease in Prepaid Expenses | (117,388 | ) | (50,652 | ) | ||||
| Increase(Decrease) in Unearned Rent | 17,000 | |||||||
| Increase (Decrease) in Accounts Payable | 454,494 | (83,716 | ) | |||||
| (Increase) Decrease in Accrued Rental Income Receivable | 0 | 15,000 | ||||||
| Increase (Decrease) in Accrued Expenses | (85,347 | ) | (157,566 | ) | ||||
| (Increase )Decrease in Accrued Interest Receivable | (132 | ) | (909 | ) | ||||
| (Increase) Decrease in Notes Receivable | ||||||||
| Net Cash Provided (Used) in Operating Activities | (1,490,101 | ) | (473,380 | ) | ||||
| Net Cash Provided ( Used) in Investing Activities: | ||||||||
| Securities Purchased for Cash | (5,000 | ) | ||||||
| Gain on Sale of Securities received prior to deconsolidation | (2,357 | ) | ||||||
| Net Cash Provided ( Used) in Investing Activities: | (2,357 | ) | (5,000 | ) | ||||
| FINANCING ACTIVITIES | ||||||||
| Net Cash Provided (Used) in Financing Activities: | ||||||||
| Common Stock issued for cash | 15,000 | |||||||
| Common Stock of Subsidiary issued for cash | 1,400,000 | 120,000 | ||||||
| Increase (Decrease) in Notes Payable | 6,100 | 428,580 | ||||||
| Increase(Decrease) Bank Overdraft | 66 | |||||||
| Increase (Decrease) in Contributed Capital | 500 | |||||||
| Net Cash Provided by Financing Activities | 1,406,166 | 564,080 | ||||||
| Net (Decrease) Increase in Cash | (86,292 | ) | 85,700 | |||||
| Cash at Beginning of Period | 86,559 | 859 | ||||||
| Cash at End of Period | 267 | 86,559 | ||||||
| Supplemental Disclosure of Non CashInvesting and Financing Activities: | ||||||||
| Common Stock Issued for Debt | 30,000 | |||||||
| Preferred Stock issued for Debt | 840,681 | |||||||
| The accompanying Notes are an integral part of these Financial Statements | ||||||||
| 14 |
The Entest Group,Inc.
(formerly known as Entest Biomedical, Inc.)
Notes to Consolidated Financial Statements
As of August 31, 2018
NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS
Entest Biomedical, Inc ( The “Company”) was incorporated in the State of Nevada on September 24, 2008 as JB Clothing Corporation. Until July 10, 2009, the Company’s principal business objective was the offering of active/leisure fashion design clothing.
On July 10, 2009 the Company abandoned its efforts in the field of active/leisure fashion design clothing when it acquired 100% of the share capital of Entest BioMedical, Inc., a California corporation, (“Entest CA”).
On June 18, 2015 the Company formed Zander Therapeutics, Inc. (“Zander”) , a Nevada corporation. As of August 31, 2018 Entest owns Zander 34.82% of Zander.
On February 12, 2018 the Company changed its name to The Entest Group, Inc.
As of August 31, 2018 the Company is a “Shell Company” as such term is defined in Rule 12(b)(2) promulgated under the Securities and Exchange Act of 1934 . This Rule defines as Shell Company as a company that has:
(1) No or nominal operations; and
(2) Either:
(i) No or nominal assets;
(ii) Assets consisting solely of cash and cash equivalents; or
(iii) Assets consisting of any amount of cash and cash equivalents and nominal other assets.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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 an August 31 fiscal year-end. The Company recognizes revenue from services and product sales when the following four revenue recognition criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the selling price is fixed or determinable, and collectability is reasonably assured.
B. PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of Entest CA, the Company’s wholly owned subsidiary. These financial statement also include the accounts of Zander up to June 10, 2018. 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. Actual results could differ from those estimates.
| 15 |
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
As of August 31, 2018 Property and Equipment consists of $0
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 August 31, 2018 consisted of $ 19,601 of Notes Payable and $8,000 due to TheraCyte, Inc.. The fair value of all of the Company’s financial instruments as of August 31, 2018 were valued according to the Level 3 input. The carrying amount of the financial instruments is equal to the fair value as determined by the Company.
The Company has determined that there are no Level 1 or Level 2 inputs for determining the fair value of the Company’s financial instruments. Fair value was determined by the Company utilizing its own assumptions and estimation. There were no transfers between levels for the period presented.
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 August 31, 2018 the Company had no uncertain tax positions, and will continue to evaluate for uncertain positions in the future.
| 16 |
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 convertible debt has an anti-dilutive effect on the EPS, therefore Diluted earnings per share are the same as basic earnings per share.
NOTE 3. 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 the Company. These standards are currently under review to determine their impact on the Company’s 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.
| 17 |
In August2014, 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.
NOTE 4. GOING CONCERN
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company generated net losses of $10,256,126 during the period from August 22, 2008 (inception) through August 31, 2018. 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 intends to seek business opportunities to review and analyze for purposes of effecting a merger, acquisition or other business combination with an operating company business.
NOTE 5. NOTES PAYABLE
As of August 31, 2018
Notes Payable:
| David Koos (See Note 6) | $ | 2,600 | ||
| Dunhill Ross Partners, Inc. | $ | 850 | ||
| Blackbriar Partners (See Note 6) | 11,600 | |||
| Regen Biopharma, Inc (See Note 6) | 4,551 | |||
| Total | $ | 19,601 |
$1,000 lent to the Company by Blackbriar Partners is due and payable February 17, 2018 and bears simple interest at a rate of 10% per annum
$7,000 lent to the Company by Blackbriar Partners is due and payable February 28, 2018 and bears simple interest at a rate of 10% per annum.
$3,000 lent to the Company by Blackbriar Partners is due and payable May 4, 2019 and bears simple interest at a rate of 10% per annum.
$600 lent to the Company by Blackbriar Partners is due and payable August 20, 2019 and bears simple interest at a rate of 10% per annum.
Blackbriar Partners is controlled by David R. Koos , the Company’s sole officer and director.
| 18 |
As of August 31, 2018 the Company remains indebted to David R. Koos , the Company’s sole officer and director, in the principal amount of $2,600 due and payable in whole or in part at the demand of David Koos and bearing simple interest at a rate of 15% per annum.
Amounts due to Regen Biopharma Inc. as of August 31, 2018 are due and payable at the demand of the holder and bear simple interest at a rate of 10% per annum. David R. Koos , the Company’s sole officer, serves as Chairman and Chief Executive officer of Regen Biopharma, Inc.
NOTE 6. RELATED PARTY TRANSACTIONS
As of August 31, 2018 the Company remains indebted to David R. Koos , the Company’s sole officer and director, in the principal amount of $2,600 due and payable in whole or in part at the demand of David Koos and bearing simple interest at a rate of 15% per annum.
As of August 31, 2018 the Company remains indebted to Blackbriar Partners in the principal amount of $11,600 of which $1,000 is due and payable February 17, 2018 and bears simple interest at a rate of 10%per annum and of which $7,000 is due and payable February 28, 2018 and bears simple interest at a rate of 10% per annum , of which$3,000 is due and payable May 4, 2019 and bears simple interest at a rate of 10% per annum and of which $600 is due and payable August 20, 2019 and bears simple interest at a rate of 10% per annum.
Blackbriar Partners is controlled by David R. Koos , the Company’s sole officer and director.
As of August 31, 2018 the Company remains indebted to Regen Biopharma, Inc. in the principal amount of $4,551 due and payable in whole or in part at the demand of the holder and bearing simple interest at a rate of 10% per annum. David R. Koos , the Company’s sole officer, serves as Chairman and Chief Executive officer of Regen Biopharma, Inc.
On October 1, 2014 Regen Biopharma Inc. entered into an agreement to sublease approximately 2,320 square feet of office space from the Company. Entest Biomedical Inc. is under common control with Regen Biopharma, Inc. as the Chairman and CEO of the Company also serves as the Chairman and CEO of Regen Biopharma, Inc. The sublease is on a month to month basis and rent payable to the Company by Regen Biopharma Inc is equal to the rent payable to the lessor by the Company and is to be paid in at such time specified in accordance with the original lease agreement between the Company and the lessor. On January 20, 2015 the sublease was amended retroactive to January 1, 2015 as follows:
The rent payable to Entest BioMedical, Inc. by the subtenant is equal to Five Thousand Dollars per month ($5,000) and is to be paid in at such time specified in accordance with the original lease agreement between the Entest BioMedical, Inc. (“Entest”) and the lessor. All charges for utilities connected with premises which are to be paid under the master lease shall be paid by Regen Biopharma, Inc. for the term of this sublease to the extent that such charges exceed the difference between the rent payable to the lessor by Entest under the master lease and the rent payable to Entest by Regen Biopharma, Inc.
| 19 |
On February 28, 2016, the Company purchased from a third party 3,500,000 shares of the Series A Preferred stock of Regen Biopharma, Inc for consideration consisting of $5,000 cash and 500,000 shares of the Company’s Series B Preferred Stock. On July 3, 2018 the Company sold the aforementioned 3,500,000 shares to Zander for consideration consisting of $35,000. David R. Koos, who serves as Chairman and Chief Executive Officer of Zander also serves as Chairman and Chief Executive Officer of Entest. Zander is under common control with Entest.
On July 3, 2018 Zander entered into a sublease agreement with Entest whereby Zander would sublet office space located at 4700 Spring Street, Suite 304, La Mesa, California 91942 from Entest on a month to month basis for $6,000 per month beginning July 5, 2018.
David R. Koos, who serves as Chairman and Chief Executive Officer of Zander also serves as Chairman and Chief Executive Officer of Entest. Zander is under common control with Entest.
NOTE 7. INCOME TAXES
| As of August 31, 2018 | ||||
| Deferred tax assets: | ||||
| Net operating tax carry forwards | $ | 2,156,652 | ||
| Other | -0- | |||
| Gross deferred tax assets | 2,156,652 | |||
| Valuation allowance | (2,156,652 | ) | ||
| Net deferred tax assets | $ | -0- | ||
As of August 31, 2018 the Company has a Deferred Tax Asset of $2,156,652 completely attributable to net operating loss carry forwards of approximately $ 10,269,773(which expire 20 years from the date the loss was incurred) consisting of:
(a) $ 13,647 of Net Operating Loss carry forwards acquired in the reverse acquisition of Entest BioMedical, Inc., a California corporation, and
(b) $ 10,256,126 of Net Operating Loss carry forwards attributable to Entest BioMedical, Inc.
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. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized. In addition, the reverse acquisition in which Entest BioMedical, Inc. was involved in 2009 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 recorded a valuation allowance reducing all deferred tax assets to $ -0-.
Income tax is calculated at the 21% Federal Corporate Rate.
NOTE 8. ACQUISITION OF ENTEST CA
On July 10, 2009 the Company acquired 100% of Entest CA, a California corporation and wholly owned subsidiary of the Company, from BMSN for consideration consisting of (a) the issuance to BMSN of 10,000,000 newly issued common shares of Entest and (b) the return by Mr. Rick Plote of 10,000,000 shares of Entest’s common stock previously issued to him by Entest for cancellation.
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NOTE 9. ACQUISITION OF THE ASSETS OF PET POINTERS, INC.
On January 4, 2011 Entest CA acquired from Pet Pointers, Inc., a California corporation doing business as McDonald Animal Hospital (“Seller”), and Dr. Gregory McDonald DVM (“McDonald”) all the goodwill from McDonald and assets of Seller except cash and accounts receivables used in connection with the operation of a veterinary medical clinic located at 225 S. Milpas Street, Santa Barbara, CA 93103 (the "Business").
Consideration for the acquisition consisted of:
I. $70,000 in cash
II. $210,000 of the Company’s common shares valued at the closing price per share as of January 4, 2011
III. Payment of no more than $78,000 to a creditor of the Seller to be paid in monthly installments of $1,500 per month
IV. Payment of no more than $25,000 to additional creditors of the Seller to be paid in monthly installments of $825 per month
V. Payment of $50,000 to McDonald on the first business day of the fourth month following the closing of the acquisition (“Closing”).
NOTE 10. DISPOSITION OF THE ASSETS OF PET POINTERS, INC.
On November 28, 2012 the “Company executed an agreement (“Agreement”) with Gregory McDonald ("McDonald"), Pet Pointers, Inc. ("Pet Pointer") whereby Mc Donald and Pet Pointer would acquire from the Company all assets (with the exception of cash and accounts receivable) utilized by the Company in the operation of the McDonald Animal Hospital, a full service veterinary clinic owned and operated by the Company and located in Santa Barbara, California (“McDonald Asset Sale”).
On October 10, 2012 a Complaint (“Complaint”) was filed in the Superior Court of the State of California against the Company and David Koos by McDonald, a former employee of the Company, alleging breach of contract and breach of the covenant of good faith and dealing in connection with the assumption of lease obligations by the Company in connection with the acquisition of the assets of Pet Pointers, Inc breach of contract and breach of the covenant of good faith and dealing in connection with an employment agreement enters into with McDonald inc connection with the Acquisition, breach of contract in connection with the Acquisition purchase agreement, breach of the covenant of good faith and dealing in connection with the Acquisition purchase agreement, implied indemnity in connection to amounts owed by McDonald to Anthony and Judi Marinelli, the Internal Revenue Service, and the California Franchise Tax Board, intentional misrepresentation, negligent misrepresentation , failure to pay wages and violations of Sections 2802, 203, and 2806 of the California Labor Code. The Complaint sought judgment for nominal damages, actual damages, compensatory damages, lost wages, compensation, expenses wage benefits and penalties pursuant to California Labor Code Sections 203 et al, 2802 and 2806, indemnification, accrued interest, punitive damages, costs of suit and attorney’s fees.
As consideration to the Company for the assets acquired, McDonald and Pet Pointers provided to the Company a General release whereby McDonald and Pet Pointer waive, release and discharge the Company and their respective assignees, officers, directors, shareholders, boards, owners, employees, attorneys, agents, trustors, trustees, beneficiaries, heirs, successors, and representatives from all known and unknown claims, demands, causes of action, attorney's fees, costs, or expenses including:
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(1) All claims relating to the Complaint.
(2) Those owed by McDonald to Anthony and Judi Marinelli which the Company became obligated to pay on McDonald’s behalf pursuant to the asset purchase agreement entered into between the Company and Gregory McDonald and Pet Pointers, Inc on January 4, 2011.
(3) Those amounts owed by McDonald to the Internal Revenue Service which the Company became obligated to pay on McDonald’s behalf pursuant to the asset purchase agreement entered into between the Company and Gregory McDonald and Pet Pointers, Inc on January 4, 2011.
(4) Those amounts owed by McDonald to the California Franchise Tax Board which the Company became obligated to pay on McDonald’s behalf pursuant to the asset purchase agreement entered into between the Company and Gregory McDonald and Pet Pointers, Inc on January 4, 2011.
Assets disposed of pursuant to the Agreement include approximately $4,840 of Property Plant and Equipment net of accumulated depreciation as well as all inventory held at the McDonald Animal Hospital.
Assets disposed of pursuant to the Agreement also include
(i) Essentially all intellectual property, including computer software, utilized in connection with the operation of the McDonald Animal Hospital
(ii) All telephone numbers, fax numbers, service marks, trademarks, trade names, fictitious business names, websites, business email addresses, vendor lists, promotional materials, vendor records and any and all business records including, but not limited to, such items stored in computer memories, microfiche, paper record or by any other means relevant to the operation of the McDonald Animal Hospital.
(iii) All customer lists, customer contacts, and any and all customer records that are related to the McDonald Animal Hospital.
As a result of the agreement, the Company recorded a non-cash pre-tax charge for the impairment of goodwill recorded in connection with the acquisition of the McDonald Animal Hospital of approximately $405,000 for the quarter ended November 30, 2012.
Pursuant to the Agreement, the Company is obligated to make payment of $13,000 within five days of the Closing of the Agreement as such term is defined in the Agreement.
Pursuant to the Agreement, the Company agrees to waive, release and discharge McDonald and Pet Pointer from all known and unknown claims, demands, causes of action, attorney's fees, costs, or expenses.
NOTE 11. DECONSOLIDATION OF ZANDER THERAPEUTICS, INC.
On May 5, 2018, The Company declared the distribution on a pro rata basis as a dividend in kind of 3,000,000 of the common shares of Zander Therapeutics, Inc., par value $0.0001, currently owned by Entest Group, Inc. to:
(a) Holders of record of the outstanding common shares of the Company as of the record date, which is May 30, 2018.
(b) Holders of record of the shares of any outstanding series of the preferred shares of the Company as of the record date, which is May 30, 2018.
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Shareholders of the Company shall receive one (1) common share of Zander Therapeutics, Inc. for each 17 common and/or preferred shares of the Company held as of the record date. The distribution of the 3,000,000 common shares of Zander Therapeutics, Inc. to the common and preferred shareholders of the Company occurred on June 11, 2018 ("Distribution Date").
As a result of the payment of the abovementioned property dividend, the Company’s percentage of ownership of Zander fell below 50% resulting in the deconsolidation of Zander as of the Distribution Date. As of the Distribution Date all assets and liabilities attributable to Zander were derecognized by the Company. The Company recognized a $10,034gain as a result of the deconsolidation. The Property dividend may be deemed to have occurred with a related party as the recipients were shareholders of Entest, including the Chairman and Chief Executive Officer of Entest and Regen Biopharma, Inc. which is a company under common control with Entest.
The Company’s remaining share of Zander , which consists of 5,000,000 shares of Zander’s Series M Preferred Stock (“Zander M Stock”) is accounted for under the Equity Method as of the Distribution Date. The Zander M Stock is carried a Fair Value and the carrying value is increased by the Company’s proportionate share of earnings of Zander and decreased by cash dividends paid by Zander as well as the Company’s proportionate share of losses of Zander up to the carrying value . As of August 31, 2018 the carrying value of the Zander M Stock has been decreased by the Company’s proportionate share of the losses of Zander and is 0. As of August 31, 2018 Entest beneficially owns 34.82% of the share equity of Zander.
5 million shares of Zander Series M Preferred Stock received by the Company on June 15, 2017 in consideration of services rendered has been valued by the Company as of the deconsolidation date utilizing the following inputs:
| Fair Value of Intellectual Property | 1,030 | |||
| prepaid Expenses | 168,000 | |||
| Accounts Payable | 454,493 | |||
| Due from Entest | 7,357 | |||
| Accrued Expenses | 2,148 | |||
| Enterprise Value | 633,028 | |||
| Less: Total Debt | (463,998 | ) | ||
| Enterprise Value available to Shareholders | 169,030 | |||
| Per Share | 0.012286 |
The Chairman and Chief Executive Officer of the Company and Zander is David R. Koos. Zander may be considered a related party of the Company.
SUMMARY INFORMATION FOR ZANDER THERAPEUTICS ,INC. FOR THE FISCAL YEAR ENDED AUGUST 31, 2018
| Revenue | 0 | |||
| Operating Loss | (2,801,376 | ) | ||
| Net Loss | (2,780,288 | ) | ||
| Portion of Net Loss attributable to Entest | (968,188 | ) |
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NOTE 12. COMMITMENTS AND CONTINGENCIES
On November 1, 2011, the Company entered into an agreement to lease approximately 2,320 square feet of office space beginning December 1, 2011 for a period of five years.
Rent to be charged to the Company pursuant to the lease is as follows:
$2,996 per month for the period beginning December 1, 2011 and ending November 30, 2012
$3,116 per month for the period beginning December 1, 2012 and ending November 30, 2013
$3,241 per month for the period beginning December 1, 2013 and ending November 30, 2014
$3,371 per month for the period beginning December 1, 2014 and ending November 30, 2015
$3,506 per month for the period beginning December 1, 2015 and ending November 30, 2016
On November 27, 2016 the lease was extended until November 30, 2021
Rent to be charged to the Company pursuant to the extension is as follows:
$2,996 per month for the period beginning December 1, 2016 and ending November 30, 2017
$3,116 per month for the period beginning December 1, 2017 and ending November 30, 2018
$3,241 per month for the period beginning December 1, 2018 and ending November 30, 2019
$3,371 per month for the period beginning December 1, 2019 and ending November 30, 2020
$3,506 per month for the period beginning December 1, 2020 and ending November 30, 2021
This property is utilized as office space. The Company believes that the foregoing property is adequate to meet its current needs.
NOTE 13. INVESTMENT SECURITIES
On February 28, 2017 the Company purchased 3,500,000 of the Series A Preferred shares of Regen Biopharma, Inc.for consideration consisting of $5,000 and 500,000 shares of the Company’s Series B Preferred stock.
The Series A Preferred shares of Regen Biopharma, Inc. described above constitute the Company’s sole investment securities as of August 31, 2017. The Company had no investment securities as of August 31, 2018
As of August 31, 2017:
| 3,500,000 | Series A Preferred shares of Regen Biopharma, Inc | |||||||||||||
| Basis | Fair Value | Total Unrealized Gains in Other Comprehensive Income | Net Unrealized Gain or (Loss) realized during the quarter ended August 31, 2017 | |||||||||||
| $ | $5,000 | $ | $190,050 | $185,050 | $53,550 | |||||||||
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NOTE 14. STOCKHOLDERS EQUITY
The stockholders' equity section of the Company contains the following classes of capital stock as of August 31, 2018:
Common Stock:
$0.0001 par value, 500,000,000 shares authorized and 49,170,472 shares issued and outstanding as of August 31, 2018.
Preferred Stock:
$0.0001 par value 5,000,000 shares authorized of which:
| (a) | 100,000 are authorized as Series AA Preferred Stock of which 634 shares are issued and outstanding as of August 31, 2018 and | |
| (b) | 4,400,000 are authorized as Series B Preferred Stock of which 728,073 shares are issued and outstanding as of August 31, 2018 and | |
| (c) | 300,000 are authorized as Series AAA Preferred Stock of which 534 shares are issued and outstanding as of August 31, 2018. |
Upon any liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary (collectively, a “Liquidation”), before any distribution or payment shall be made to any of the holders of Common Stock or any other series of preferred stock, the holders of Series B Preferred Stock shall be entitled to receive out of the assets of the Company, whether such assets are capital, surplus or earnings, an amount equal to $0.10 per share of Series B Preferred Stock (the “Liquidation Amount”) plus all declared and unpaid dividends thereon, for each share of Series B Preferred Stock held by them.
If, upon any Liquidation, the assets of the Company shall be insufficient to pay the Liquidation Amount, together with declared and unpaid dividends thereon, in full to all holders of Series B Preferred Stock, then the entire net assets of the Company shall be distributed among the holders of the Series B Preferred Stock, ratably in proportion to the full amounts to which they would otherwise be respectively entitled and such distributions August be made in cash or in property taken at its fair value (as determined in good faith by the Board), or both, at the election of the Board..
Non Voting Convertible Preferred Stock having a $1.00 par value:
3,000,000 shares authorized of which 1,001,533 shares are issued and outstanding as of August 31 2018 .
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 the greater of $0.01 per share or 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.
NOTE 15. STOCK TRANSACTIONS
On September 8, 2017 the Company issued 2,500,000 Common Shares in connection with a conversion of 25,000 Non Voting Convertible Preferred Shares.
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NOTE 16. SUBSEQUENT EVENTS
On October 2, 2018 Entest Group, Inc. (the “Company”) amended Article 4 of the Company’s Articles of Incorporation to be and read as follows:
4. Authorized Shares:
The aggregate number of shares, which the corporation shall have authority to issue, shall consist of 500,000,000 shares of Common Stock having a $.0001 par value, and 5,000,000 shares of Preferred Stock having a $.0001 par value and 3,000,000 shares of Non Voting Convertible Preferred Stock having a $1.00 par value.
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 the greater of (i) $0.001 per share or (ii) 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.
The Common and/or Preferred Stock of the Company may be issued from time to time without prior approval by the stockholders. The Common and/or Preferred Stock may be issued for such consideration as may be fixed from time to time by the Board of Directors- The Board of Directors may issue such share of Common and/or Preferred Stock in one or more series, with such voting powers, designations, preferences and rights or qualifications, limitations or restrictions thereof as shall be stated in the resolution or resolutions.”
On November 16, 2018 Entest terminated its lease on office space. The property has been assumed by BST Partners which is permitting the Company to utilize the space free of charge on a week to week basis.
BST Partners is controlled by David Koos, the Company’s Chairman and Chief Executive Officer.
On November 16, 2018 Zander Therapeutics Inc. and the Company agreed to terminate Zander’s sublease with the Company ( See Note 6) effective the rental period commencing November, 2018.
On November 16, 2018 Regen Biopharma Inc. and the Company agreed to terminate Regen’s sublease with the Company ( See Note 6) effective the rental period commencing November, 2018.
David R. Koos serves as Chairman and Chief Executive Officer of the Company, Zander Therapeutics, Inc. and Regen Biopharma Inc.
On November 16, 2018:
Entest Group, Inc. and David R. Koos agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to Koos by Entest from the beginning of time to November 30, 2018 by transferring to Koos 3,000,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company
Entest Group, Inc. and Blackbriar Partners (“BP) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to BP by Entest from the beginning of time to November 30, 2018 by transferring to BP 20,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company. BP is controlled by David Koos the Company’s sole officer and director.
Entest Group, Inc. and the Sherman Family Trust (“SFT”) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to SFT by Entest from the beginning of time to November 30, 2018 by transferring to SFT 612,500 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company.
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Entest Group, Inc. and Dunhill Ross Partners (“DR”) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to DR by Entest from the beginning of time to November 30, 2018 by transferring to DR 12,500 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company.
Entest Group, Inc. and the Bio Technology Partners Business Trust (“BPBT”) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to BPBT by Entest from the beginning of time to November 30, 2018 by transferring to BPBT 412,500 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company.
Entest Group, Inc. and the Bio Matrix Scientific Group, Inc. (“BMSN”) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to BMSN by Entest from the beginning of time to November 30, 2018 by transferring to BMSN 5,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company. David R. Koos serves as Chairman and Chief Executive Officer of the Company and BMSN.
Entest Group, Inc. and Bostonia Partners (“BSP”) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to BSP by Entest from the beginning of time to November 30, 2018 by transferring to BSP 212,500 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company.
Entest Group, Inc. and Regen Biopharma, Inc. (“RGBP”) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to RGBP by Entest from the beginning of time to November 30, 2018 by transferring to RGBP 250,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company.
Entest Group, Inc. and Regen Biopharma, Inc. (“RGBP”) agreed to satisfy any and all rent prepaid by RGBP to Entest from the beginning of time to November 30, 2018 by transferring to RGBP 475,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company.
David R. Koos serves as Chairman and Chief Executive Officer of the Company and RGBP.
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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
During the Registrant's most two most recent fiscal years there were no disagreements with AMC Auditing (“AMC”) , the Company’s independent registered public accounting firm, whether or not resolved, on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which, if not resolved to AMC’s satisfaction, would have caused it to make reference to the subject matter of the disagreement in connection with its report on the Registrant's financial statements.
Item 9A. Controls and Procedures
a) Evaluation of disclosure controls and procedures.
The principal executive officer and principal financial officer have evaluated the Company’s disclosure controls and procedures as of August 31, 2018. Based on this evaluation, they have concluded that the disclosure controls and procedures were effective to ensure that the information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms and to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. David Koos is the Company’s CEO and acting CFO. He functions as the Company’s principal executive officer and principal financial officer.
b) Management’s annual report on internal control over financial reporting.
Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) promulgated under the Securities and Exchange Act of 1934. Rule 13a-15(f) defines internal control over financial reporting as follows:
“The term internal control over financial reporting is defined as a process designed by, or under the supervision of, the issuer's principal executive and principal financial officers, or persons performing similar functions, and effected by the issuer's board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the issuer;
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the issuer are being made only in accordance with authorizations of management and directors of the issuer; and
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the issuer's assets that could have a material effect on the financial statements.”
The Company’s internal control over financial reporting is a process designed under the supervision of the Company’s management to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with U.S. generally accepted accounting principles.
In designing and evaluating our disclosure controls and procedures, our management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only a reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met.
The Company’s management assessed the effectiveness of its internal control over financial reporting as of August 31, 2018 based on the framework in 2013 Committee of Sponsoring Organizations of the Treadway Commission, or COSO, framework. Based.” Based on its assessment, management believes that, as of August 31, 2018, the Company’s internal control over financial reporting is effective.
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Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management's report in this annual report. This exemption for smaller reporting companies provided under the temporary rules referenced above has been made permanent under Section 989G of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
(c) There have been no changes during the quarter ended August 31, 2018 in the Company’s internal controls over financial reporting that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting.
Item 10. Directors, Executive Officers and Corporate Governance
On June 19, 2009 the Board of Directors of the Company elected David R. Koos, a director of the Company and appointed Dr. Koos President, Chief Executive Officer, Secretary, Chief Financial Officer, Principal Accounting Officer of the Company. Dr. Koos resigned as Chief Financial Officer on March 31, 2010 and assumed the position of Acting Chief Financial Officer and Principal Accounting Officer on August 8, 2011 upon the resignation of Tammy L. Reynolds who served as Chief Financial Officer from the period from March 31, 2010 to August 8, 2011.
Education:
DBA - Finance (December 2003)
Atlantic International University
Ph.D. - Sociology (September 2003)
Atlantic International University
MA - Sociology (June 1983)
University of California - Riverside, California
Five Year Employment History:
| Position: | Company Name: | Employment Dates: | ||
| Chairman, President, Chief Executive Officer, Secretary, Chief Financial Officer, Principal Account Officer | Entest Group, Inc | June 19, 2009 to the present | ||
| Chairman Chief Executive Officer, Secretary and Treasurer | Zander Therapeutics, Inc. | June 2015 to the Present | ||
| Chairman and CEO | Regen Biopharma, Inc. | April 24, 2012 to Present | ||
| Acting CFO | Regen Biopharma, Inc. | April 24, 2012 to February 11, 2015 | ||
| President | Regen
Biopharma, Inc. |
May 29, 2013 to October 9, 2013 | ||
| Chief Financial Officer, Principal Accounting Officer | Entest BioMedical, Inc | June 19, 2009 to March 31, 2010 | ||
| Acting Chief Financial Officer, Principal Accounting Officer | Entest BioMedical, Inc | August 8, 2011 to the present | ||
| Chairman, President, CEO and Acting CFO | Bio-Matrix Scientific Group, Inc. | June 14, 2006 (Chairman) to Present; June 19, 2006 (President, CEO and Acting CFO); June 19, 2006 (Secretary) to Present |
Code of Ethics
On November 11, 2009 we adopted a Code of Ethics pursuant to Section 406 of the Sarbanes-Oxley Act of 2002
Director Independence
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Audit Committee and Audit Committee Financial Expert
The sole member of the Company’s board of Directors may not be considered independent as he is also its sole officer. The Company is not a "listed company" under Securities and Exchange Commission (“SEC”) rules and is therefore not required to have an audit committee comprised of independent directors. The Company does not currently have an audit committee, however, for certain purposes of the rules and regulations of the SEC and in accordance with the Sarbanes-Oxley Act of 2002, the Company’s Board of Directors is deemed to be its audit committee and as such functions as an audit committee and performs some of the same functions as an audit committee including: (1) selection and oversight of our independent accountant; (2) establishing procedures for the receipt, retention and treatment of complaints regarding accounting, internal controls and auditing matters; and (3) engaging outside advisors. The Board of Directors has determined that its member is able to read and understand fundamental financial statements and has substantial business experience that results in that member's financial sophistication. Accordingly, the Board of Directors believes that its member has the sufficient knowledge and experience necessary to fulfill the duties and obligations that an audit committee would have.
Nominating and Compensation Committees
The Company does not have standing nominating or compensation committees, or committees performing similar functions. The board of directors believes that it is not necessary to have a compensation committee at this time because the functions of such committee are adequately performed by the board of directors. The board of directors also is of the view that it is appropriate for the Company not to have a standing nominating committee because the board of directors has performed and will perform adequately the functions of a nominating committee. The Company is not a "listed company" under SEC rules and is therefore not required to have a compensation committee or a nominating committee.
Shareholder Communications
There has not been any defined policy or procedure requirements for stockholders to submit recommendations or nomination for directors. There are no specific, minimum qualifications that the board of directors believes must be met by a candidate recommended by the board of directors. Currently, the entire board of directors decides on nominees, on the recommendation of any member of the board of directors followed by the board’s review of the candidates’ resumes and interview of candidates. Based on the information gathered, the board of directors then makes a decision on whether to recommend the candidates as nominees for director. The Company does not pay any fee to any third party or parties to identify or evaluate or assist in identifying or evaluating potential nominee.
Because management and the Board of Directors of the Company are the same people, the Board of Directors has determined not to adopt a formal methodology for communications from shareholders on the belief that any communication would be brought to the Board of Directors’ attention by virtue of the co-extensive capacities of the Board of Directors.
Executive Compensation
SUMMARY COMPENSATION TABLE
| Name and Principal Position | Year | Salary
($) |
Bonus
($) |
Stock
Awards ($) |
Restricted
Stock Awards ($) |
Option
Awards ($) |
Non
Equity Incentive Plan Compensation ($) |
Nonqualified
Deferred Compensation Earnings ($) |
All
Other Compensation ($) |
Total
($) | ||||||||||||||||||||||||||||||
| David
Koos Chairman, President and CEO |
From September 1, 2017 to August 31, 2018 | $ | 120,000 | * | 17,000 | $ | 0 | 0 | 0 | 0 | 0 | $137,000 | ||||||||||||||||||||||||||||
| From September 1, 2016 to August 31, 2017 | $ | 120,000 | ** | 0 | 50 | 0 | 0 | 0 | 0 | 0 | $120,050 | |||||||||||||||||||||||||||||
*Does not include $88,000 in salary accrued but unpaid during prior periods paid to David Koos during the fiscal year ended August 31, 2018.
** Does not include $102,000 in salary accrued but unpaid during prior periods paid to David Koos during the fiscal year ended August 31, 2017.
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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table sets forth information known to the Company with respect to the beneficial ownership of each class of the Company’s capital stock as of November 15, 2018 for (1) each person known by the Company to beneficially own more than 5% of each class of the Company’s voting securities, (2) each executive officer, (3) each of the Company’s directors and (4) all of the Company’s executive officers and directors as a group. As of November 15, 2018 Entest BioMedical, Inc. had 49,170,472 common shares outstanding, 728, 073 Series B Preferred shares outstanding , 667 Series AA preferred shares outstanding, 534 Series AAA preferred shares outstanding, and 1001533 shares of the Company’s Non Voting Convertible Preferred Stock outstanding.
Based on 49,170,472 shares issued and outstanding as of November 15,2018
| Title of Class | Name
and Address of Beneficial Owner |
Amount
and Nature of Beneficial Owner |
Percent of Class | |||||||||
| Common | David
R. Koos* C/o Entest Group, Inc., Inc 4700 SPRING STREET, SUITE 203, LA MESA, CALIFORNIA, 91942 |
23,300,001 | 47.39 | % | ||||||||
| Common | Life
Sciences Journeys, Inc. 1106 2nd street Encinitas, CA ,92024 |
2,500,000 | 5.08 | % | ||||||||
| Common | All Officers and Directors As a Group | 23,300,001 | 47.39 | % | ||||||||
*Includes 66,667 common shares owned by Bio-Matrix Scientific Group, Inc. (David Koos is CEO, President and Chairman of Bio-Matrix Scientific Group, Inc.). Includes 8,000,000 common shares owned by Regen Biopharma, Inc. (David Koos is CEO and Chairman of Regen Biopharma, Inc.)
Based on 728,009 shares issued and outstanding as of November 15, 2018.
| Title of Class | Name and Address of Beneficial Owner | Amount and Nature of Beneficial Owner | Percent of Class | |||||||
| Series B Preferred | David
R. Koos* C/o Entest Group, Inc 4700 SPRING STREET, SUITE 203, LA MESA, CALIFORNIA, 91942 |
15,001 | 2.6 | % | ||||||
| Series B Preferred | Thomas
Ichim 9255 Town Center Dr San Diego, CA,92121 |
500,000 | 68.6 | % | ||||||
| Series B Preferred | Thomas
Donnelly 38 Miriam Road Denistone, NSW Australia |
100,000 | 13.761 | % | ||||||
| Series B Preferred | Linda
Black 521 Garfield Ave Winter Park, FL 32789 |
100,000 | 13.761 | % | ||||||
| Series B Preferred | All Officers and Directors as a Group* | 15,001 | 2.6 | % | ||||||
*Includes 8,334 Series B Preferred shares owned by Bio-Matrix Scientific Group, Inc. (David Koos is CEO, President and Chairman of Bio-Matrix Scientific Group, Inc.).
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Based on 667 shares issued and outstanding as of November 15, 2018
| Title of Class | Name and Address of Beneficial Owner | Amount
and Nature of Beneficial Owner |
Percent of Class | |||||||
| Series AA Preferred Shares | David
R. Koos C/o Entest Group, Inc 4700 SPRING STREET, SUITE 203, LA MESA, CALIFORNIA, 91942 |
667 | 100 | % | ||||||
| Series AA Preferred Shares | All
Officers and Directors As a Group |
667 | 100 | % | ||||||
Based on 534 shares issued and outstanding as of November 15, 2018
| Title of Class | Name and Address of Beneficial Owner | Amount
and Nature of Beneficial Owner |
Percent of Class | |||||||
| Series AAA Preferred Shares | David
R. Koos C/o Entest Bio Medical Inc., Inc 4700 SPRING STREET, SUITE 203, LA MESA, CALIFORNIA, 91942 |
534 | 100 | % | ||||||
| Series AAA Preferred Shares | All
Officers and Directors As a Group |
534 | 100 | % | ||||||
Based on 1,001,533 shares issued and outstanding as of November 15, 2018
| Title of Class | Name and Address of Beneficial Owner | Amount and Nature of Beneficial Owner | Percent of Class | |||||||
| Non Voting Convertible Preferred | Bio
Technology Partners Business Trust 8130 Las Mesa Blvd Las Mesa CA 91941 |
124,000 | 12.38 | % | ||||||
| Non Voting Convertible Preferred | David
R. Koos C/o Entest Bio Medical Inc., Inc 4700 SPRING STREET, SUITE 203, LA MESA, CALIFORNIA, 91942* |
185,852 | 18.55 | % | ||||||
| Non Voting Convertible Preferred | Bostonia
Partners 1204 Tangerine El Cajon, CA,92021 |
327681 | 32.7 | % | ||||||
| Non Voting Convertible Preferred | Dunhill
Ross Partners La Mesa CA |
165,000 | 16.4 | % | ||||||
| Non Voting Convertible Preferred | Sherman
Family Trust La Mesa, CA |
199,000 | 19.8 | % | ||||||
| Non Voting Convertible Preferred | All Officers and Directors as a Group* | 185,852 | 18.55 | % | ||||||
* Includes 185,852 shares owned by Regen Biopharma, Inc. David R. Koos is Chairman and Chief Executive Officer of both Entest Biomedical, Inc. and Regen Biopharma, Inc.
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Item 13. Certain Relationships and Related Transactions, and Director Independence
As of August 31, 2018 the Company remains indebted to David R. Koos , the Company’s sole officer and director, in the principal amount of $2,600 due and payable in whole or in part at the demand of David Koos and bearing simple interest at a rate of 15% per annum.
As of August 31, 2018 the Company remains indebted to Blackbriar Partners in the principal amount of $11,600 of which $1,000 is due and payable February 17, 2018 and bears simple interest at a rate of 10%per annum and of which $7,000 is due and payable February 28, 2018 and bears simple interest at a rate of 10% per annum , of which$3,000 is due and payable May 4, 2019 and bears simple interest at a rate of 10% per annum and of which $600 is due and payable August 20, 2019 and bears simple interest at a rate of 10% per annum.
Blackbriar Partners is controlled by David R. Koos , the Company’s sole officer and director.
As of August 31, 2018 the Company remains indebted to Regen Biopharma, Inc. in the principal amount of $4,551 due and payable in whole or in part at the demand of the holder and bearing simple interest at a rate of 10% per annum. David R. Koos , the Company’s sole officer, serves as Chairman and Chief Executive officer of Regen Biopharma, Inc.
On October 1, 2014 Regen Biopharma Inc. entered into an agreement to sublease approximately 2,320 square feet of office space from the Company. Entest Biomedical Inc. is under common control with Regen Biopharma, Inc. as the Chairman and CEO of the Company also serves as the Chairman and CEO of Regen Biopharma, Inc. The sublease is on a month to month basis and rent payable to the Company by Regen Biopharma Inc is equal to the rent payable to the lessor by the Company and is to be paid in at such time specified in accordance with the original lease agreement between the Company and the lessor. On January 20, 2015 the sublease was amended retroactive to January 1, 2015 as follows:
The rent payable to Entest BioMedical, Inc. by the subtenant is equal to Five Thousand Dollars per month ($5,000) and is to be paid in at such time specified in accordance with the original lease agreement between the Entest BioMedical, Inc. (“Entest”) and the lessor. All charges for utilities connected with premises which are to be paid under the master lease shall be paid by Regen Biopharma, Inc. for the term of this sublease to the extent that such charges exceed the difference between the rent payable to the lessor by Entest under the master lease and the rent payable to Entest by Regen Biopharma, Inc.
On February 28, 2016, the Company purchased from a third party 3,500,000 shares of the Series A Preferred stock of Regen Biopharma, Inc for consideration consisting of $5,000 cash and 500,000 shares of the Company’s Series B Preferred Stock. On July 3, 2018 the Company sold the aforementioned 3,500,000 shares to Zander for consideration consisting of $35,000. David R. Koos, who serves as Chairman and Chief Executive Officer of Zander also serves as Chairman and Chief Executive Officer of Entest. Zander is under common control with Entest.
On July 3, 2018 Zander entered into a sublease agreement with Entest whereby Zander would sublet office space located at 4700 Spring Street, Suite 304, La Mesa, California 91942 from Entest on a month to month basis for $6,000 per month beginning July 5, 2018.
David R. Koos, who serves as Chairman and Chief Executive Officer of Zander also serves as Chairman and Chief Executive Officer of Entest. Zander is under common control with Entest.
On November 16, 2018 Entest terminated its lease on office space. The property has been assumed by BST Partners which is permitting the Company to utilize the space free of charge on a week to week basis.
BST Partners is controlled by David Koos, the Company’s Chairman and Chief Executive Officer.
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On November 16, 2018 Zander Therapeutics Inc. and the Company agreed to terminate Zander’s sublease with the Company effective the rental period commencing November, 2018.
On November 16, 2018 Regen Biopharma Inc. and the Company agreed to terminate Regen’s sublease with the Company effective the rental period commencing November, 2018.
David R. Koos serves as Chairman and Chief Executive Officer of the Company, Zander Therapeutics, Inc. and Regen Biopharma Inc.
On November 16, 2018:
Entest Group, Inc. and David R. Koos agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to Koos by Entest from the beginning of time to November 30, 2018 by transferring to Koos 3,000,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company.
Entest Group, Inc. and Blackbriar Partners (“BP) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to BP by Entest from the beginning of time to November 30, 2018 by transferring to BP 20,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company. BP is controlled by David Koos the Company’s sole officer and director.
Entest Group, Inc. and the Bio Matrix Scientific Group, Inc. (“BMSN”) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to BMSN by Entest from the beginning of time to November 30, 2018 by transferring to BMSN 5,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company. David R. Koos serves as Chairman and Chief Executive Officer of the Company and BMSN.
Entest Group, Inc. and Regen Biopharma, Inc. (“RGBP”) agreed to satisfy any and all unpaid interest resulting from accrued interest earned on Notes Payable to RGBP by Entest from the beginning of time to November 30, 2018 by transferring to RGBP 250,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company.
Entest Group, Inc. and Regen Biopharma, Inc. (“RGBP”) agreed to satisfy any and all rent prepaid by RGBP to Entest from the beginning of time to November 30, 2018 by transferring to RGBP 475,000 shares of the Series M Preferred stock of Zander Therapeutics, Inc. owned by the Company.
David R. Koos serves as Chairman and Chief Executive Officer of the Company and RGBP.
Director Independence
Audit Committee and Audit Committee Financial Expert
The Company’s sole director may not be considered independent as he is also an officer. The Company is not a "listed company" under Securities and Exchange Commission (“SEC”) rules and is therefore not required to have an audit committee comprised of independent directors. The Company does not currently have an audit committee, however, for certain purposes of the rules and regulations of the SEC and in accordance with the Sarbanes-Oxley Act of 2002, the Company’s Board of Directors is deemed to be its audit committee and as such functions as an audit committee and performs some of the same functions as an audit committee including: (1) selection and oversight of our independent accountant; (2) establishing procedures for the receipt, retention and treatment of complaints regarding accounting, internal controls and auditing matters; and (3) engaging outside advisors. The Board of Directors has determined that its sole member is able to read and understand fundamental financial statements and has substantial business experience that results in the member's financial sophistication. Accordingly, the Board of Directors believes that its member has the sufficient knowledge and experience necessary to fulfill the duties and obligations that an audit committee would have.
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Nominating and Compensation Committees
The Company does not have standing nominating or compensation committees, or committees performing similar functions. The Board of Directors believes that it is not necessary to have a compensation committee at this time because the functions of such committee are adequately performed by the board of directors. The Board of Directors also is of the view that it is appropriate for the Company not to have a standing nominating committee because the Board of Directors has performed and will perform adequately the functions of a nominating committee. The Company is not a "listed company" under SEC rules and is therefore not required to have a compensation committee or a nominating committee.
Shareholder Communications
There has not been any defined policy or procedure requirements for stockholders to submit recommendations or nomination for directors. There are no specific, minimum qualifications that the board of directors believes must be met by a candidate recommended by the board of directors. Currently, the entire board of directors decides on nominees, on the recommendation of any member of the board of directors followed by the board’s review of the candidates’ resumes and interview of candidates. Based on the information gathered, the board of directors then makes a decision on whether to recommend the candidates as nominees for director. The Company does not pay any fee to any third party or parties to identify or evaluate or assist in identifying or evaluating potential nominee.
The Board of Directors has determined not to adopt a formal methodology for communications from shareholders on the belief that any communication would be brought to the board of directors’ attention by virtue of communication with management.
Item 14. Principal Accounting Fees and Services
The following table sets forth the aggregate fees billed to us by AMC Auditing during the period beginning September 1, 2017 and ending August 31, 2018:
| Audit Fees | $ | 15,000 | ||
| Audit Related Fees | 13,546 | |||
| Tax Fees | 0 | |||
| All Other Fees | 0 | |||
| $ | 28,546 |
Audit Fees: Aggregate fees billed for professional services rendered for the audit of the Company's annual financial statements.
Audit Related Fees: Aggregate fees billed for professional services rendered for assurance and related services that were reasonably related to the performance of the audit or review of our financial statements and are not reported under “Audit Fees” above. During the year ended August 31, 2017 these fees were primarily derived from review of financial statements in the Company's Form 10Q Reports.
All services listed were pre-approved by the Board of Directors, functioning as the Audit Committee in accordance with Section 2(a) 3 of the Sarbanes-Oxley Act of 2002.
The Board has considered whether the services described above are compatible with maintaining the independent accountant's independence and has determined that such services have not adversely affected the independence of AMC Auditing.
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Item 15. Exhibit Index
| 31.1 | CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 302 OF THE SARBANESE-OXLEY ACT OF 2002 | |
| 31.2 | CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 302 OF THE SARBANESE-OXLEY ACT OF 2002 | |
| 32.1 | CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 | |
| 32.2 | CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 | |
| 3(i) | TEXT OF CERTIFICATE OF AMENDMENT Name Change( (a) ) | |
| 10.1 | Stock Purchase Agreement (b) | |
| 3(ii) | TEXT OF CERTIFICATE OF AMENDMENT ART. 4(c) | |
| 99.1 | Stock purchase Agreement sale of control shares (d) | |
| (a) | Incorporated by reference to Exhibit 3(i) of the Company’s Form 8-K dated 1/10/2018 |
| (b) | Incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K dated 7/5/2018 |
| (c) | Incorporated by reference to Exhibit 3(i) of the Company’s Form 8-K dated 10/3/2018 |
| (d) | Incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K filed 11/20/2018 |
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Entest BioMedical, Inc. | |||
| By: | /s/David R. Koos | ||
| Name: David R. Koos | |||
Title: President, Chairman, Chief Executive Officer | |||
| Date: November 21, 2018. |
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on November 25, 2014.
| By: | /s/ David R. Koos | ||
| Name: David R. Koos | |||
| Title: President, Chairman of the Board of Directors, Chief Executive Officer, Acting Chief Financial Officer | |||
| Date: November 21, 2018. |
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