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EX-32.2 - CERTIFICATION OF CHIEF FINANCIAL OFFICER - ENTEST GROUP, INC.entb20140831form10kex32_2.htm
EX-32.1 - CERTIFICATION OF CHIEF EXECUTIVE OFFICER - ENTEST GROUP, INC.entb20140831form10kex32_1.htm
EX-31.1 - CERTIFICATION OF CHIEF EXECUTIVE OFFICER - ENTEST GROUP, INC.entb20140831form10kex31_1.htm
EX-31.2 - CERTIFICATION OF CHIEF FINANCIAL OFFICER - ENTEST GROUP, INC.entb20140831form10kex31_2.htm

 

United States Securities and Exchange Commission

Washington, D.C.  20549

 

Form 10-K

 

 [X]

ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934:

 

For the fiscal year ending August 31, 2014

 

 

 [   ]

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 BIOMEDICAL, 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 [X]    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 [X]

 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  Yes [   ]   No [X]

 
 

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  [X]    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, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter: $ 966,456

 

As of November 21, 2014 Entest BioMedical, Inc. had 2,405,570, 642 common shares outstanding, 4, 201,397 Series B Preferred shares outstanding , 100,000 Series AA preferred shares outstanding and 80,000 Series AAA preferred shares outstanding.

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 subsidiary.

 
 

 

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, including:

 

  dependence on key personnel;
  competitive factors;
  degree of success of research and development programs
  the operation of our business; and
  general economic conditions

 

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. As of November 1, 2011 the former stockholder of Entest CA held approximately 48% of the outstanding common shares of the Company.

 

Upon acquisition of Entest CA, we abandoned our efforts in the field of active/leisure fashion design clothing.  Our business is currently the business of Entest CA, and we currently intend to develop and commercialize therapies, medical devices and medical testing procedures. On July 12, 2009 we adopted the name of Entest CA when we changed our name to Entest BioMedical, Inc.

 

The Company’s current strategy is to develop and commercialize therapies, medical devices and medical testing procedures for the veterinary market.  It is believed by the Company that any required regulatory approvals can be obtained much more rapidly with regard to products and services developed for the veterinary market and that the achievement of successful clinical trials and commercialization of such products and services may allow the company to enter into collaborations with larger pharmaceutical companies for the purpose of developing and commercializing these products and services for human usage.

 

The process by which a new drug is approved for use in humans within the United States generally begins prior to submission of the IND (Investigational New Drug Application) with the FDA.

 

Prior to submission of the IND, the sponsor of the drug compound under development must test the drugs on laboratory animals (preclinical testing) in order that toxicity may be determined and efficacy may be demonstrated. The results of such preclinical testing is crucial in determining whether or not the sponsor may proceed onto clinical trials on human beings and preclinical testing is required to be performed on multiple species.

 

Drug studies in humans can begin only after an IND is reviewed by the FDA and a local institutional review board (IRB). The board is a panel of scientists and non-scientists in hospitals and research institutions that oversees clinical research.

 

IRBs approve the clinical trial protocols, which describe the type of people who may participate in the clinical trial, the schedule of tests and procedures, the medications and dosages to be studied, the length of the study, the study's objectives, and other details. IRBs make sure the study is acceptable, that participants have given consent and are fully informed of their risks, and that researchers take appropriate steps to protect patients from harm.

 

After trial protocols have been approved the sponsor moves on to Phase I clinical trials (to determine safety and toxicity in a small number of volunteers) and, if Phase 1 studies don't reveal unacceptable toxicity, Phase II and Phase III clinical trials to determine effectiveness.

 

The process by which a new drug is approved for veterinary  use within the United States generally begins with the sponsor researching  and developing  the new compound and conducting  initial (“pilot”) studies on it for a specific use in a specific animal species (called the “target animal” species) If the results of the pilot studies are promising and there is a potential market for the drug, the drug sponsor contacts The US Food and Drug Administration’s Center for Veterinary Medicine (CVM) to officially begin the drug approval process by opening an Investigational New Animal Drug (“INAD”) file.  Information is submitted regarding Chemistry, Manufacturing, and Controls; Effectiveness; Target Animal Safety; Human Food Safety(if applicable); Environmental Impact (if applicable) and Labeling in support of the NADA (New Animal Drug Application) which is submitted by the sponsor for approval by the FDA.

 

With the exception of a biologic product which can be classified as a medical device,  Biologics developed for human use generally are undergo the same path to FDA approval as  for drugs. Biologics classified as medical devices may, in most instance, be subject to premarket approval by the FDA. Medical devices intended for veterinary use are not subject to premarket approval by the FDA.

 

Veterinary Biologics are regulated by the U.S. Department of Agriculture (USDA)  which is authorized, under the 1913 Virus-Serum-Toxin Act as amended by the 1985 Food Security Act, to ensure that all veterinary biologics produced in, or imported into, the United States are not worthless, contaminated, dangerous, or harmful. The Veterinary Biologics Program of the USDA's Animal and Plant Health Inspection Service (APHIS) oversees the veterinary biologics industry in the United States.

 

Domestic manufacturers of veterinary biologics, for domestic use or for export, are required to possess a valid U.S. Veterinary Biologics Establishment License and an individual U.S. Veterinary Biologics Product License for each product produced for sale.  Prior to being granted a U.S. Veterinary Biologic Establishment License, the applicant must submit detailed information regarding the facilities and the qualifications of key personnel and must submit to an inspection of the facilities by the Center for Veterinary Biologics, a division of the USDA . To qualify for an establishment license, an applicant also must qualify for at least one product license.

 

Prior to being granted a U.S. Veterinary Biologics Product License, the applicant must submit detailed information including test reports and research data sufficient to establish purity, safety, potency and efficacy of the product, an Outline of Production, and information regarding labeling and  facilities that are to be used in preparation.

 

It is the Company’s opinion that factors such as the lack of need for multispecies pre clinical testing, smaller subject size in efficacy testing (subjects generally  in the hundreds for veterinary equivalent of Phase III clinical trials as opposed to generally  in the thousands for Phase III clinical trials for drug compounds for use in humans), lack of the requirement for premarket approval  for medical devices intended for veterinary use should generally lead to a shorter timeframe for approval by the appropriate regulators of drugs, biologics, and medical devices intended for veterinary use as opposed to drugs, biologics, and medical devices intended for human use.

 

The Company is currently focusing its efforts and allocating its resources towards:

 

(a)           The development and commercialization of ImenVax™, a therapeutic cancer vaccine for use in canines

 

(b)           The acquisition of veterinary clinics 

The acquisition of existing veterinary clinics / hospitals remains an integral part of the Company’s business plan. At this time, the company is seeking to identify and acquire veterinary practices existing and operating within the areas of San Diego, California and Orange County, California .The Company believes that these areas are close enough in proximity the Company’s headquarters to allow ease of interaction with the Company's management . In addition, the Company believes owning and operating veterinary clinics within the San Diego, California and Orange County , California areas will provide greater convenience for persons involved with the Company's research and development activities who may be required to utilitize those facilities. The company is currently in discussions with entities it believes can expedite local clinic acquisitions. 

The Company has not undertaken any discussions with any pharmaceutical companies regarding the commercialization of any products under development. None of the Company’s products have been approved by any regulatory body for marketing within the United States or anywhere else. No assurance can be given that all or any of the Company’s currently planned products will ever be commercialized. Therapies which are veterinary biologics may be administered to patients of veterinary clinics that may be acquired prior to licensure under the exemption provided by 9 CFR 107.1, which exempts a veterinary biologic from Federal regulation if the product was manufactured by veterinarians AND intended solely for use with their clients' animals under a veterinarian-client-patient (VCP) relationship.  

 

Principal Products and Services

 

The Company is currently focusing its research and development efforts toward the successful development and commercialization of the ImenVax family of canine cancer vaccines as well as the acquisition of existing veterinary clinics / hospitals to be utilized as potential distribution channels for its ImenVax family of canine cancer vaccines. The Company believes that, in addition to serving as distribution channels for the Company’s immuno-therapeutic cancer vaccine for canines, these clinics will be able to generate revenue for the Company from current operations. It is anticipated by the Company that data collected from canine cancer treatment will provide support for eventual use of this therapy in humans and such therapy may be developed and commercialized by the Company in collaboration with larger and better capitalized pharmaceutical companies.

 

ImenVax™ I

 

ImenVax™ I, currently under development by the Company, is a therapeutic for canine cancer which involves isolating tumor cells from the patient and then placing the cells into a cell implant device that is inserted subcutaneously into the patient.  The resulting expression of tumor antigens from the device is intended to generate an anti-tumor immune response. The implant chamber device provokes immune responses to the tumor cells isolated from the patient’s own tumor through a process known as indirect presentation. Tumor cells implanted in the device are exposed to conditions that are distinct from the tumor’s environment from which they were isolated. This altered environment allows for anti-tumor responses that are not ordinarily observed in the natural tumor progression.

 

The cells are :

 

1) Isolated from the tumor and freed from the natural tumor microenvironment

 

2) Subjected to an initial ischemic condition of hypoxia that induces increased antigen expression

 

3) Allowed to repopulate within the device in a context that facilitates extended release of tumor antigens.

 

The device utilized is comprised of a 0.4 micron inner membrane to retain the implanted cells and an

outer 5 micron membrane that allows blood vessels to form on the surface to enhance biocompatibility. The outer membrane is held in place by a polyester mesh. The membranes are sonically sealed using a polyester mesh insert.

 

The device contains a surface architecture that promotes vascularization in-vivo. There is an initial ischemic phase that may additionally influence the tumor cell growth characteristics and genetic regulation of the tumor cells.

 

It is hypothesized that shortly after implantation, the expression of immunosuppressive molecules is down regulated while the release of antigens is maintained, thus allowing immune responses to occur that would normally be suppressed.

 

The Antigens that are released from the implanted device are taken up by antigen presenting cells (APC).

It is believed that the APCs will be trained to recognize the cancer cells and alert the body’s immune response, activating antibodies and T cells to destroy the tumor cells.

 

The Company is currently conducting a ten dog safety study to Evaluate ImenVax™ I for the Treatment of Canine Oral Melanoma and determine adverse effects, if any. As of May 17, 2012 three dogs suffering from oral melanoma have been administered the therapy with no dog suffering any material adverse reaction.

 

Inclusion in the Safety Study is limited to ten dogs with histologically confirmed canine oral melanoma with a Studied Karnofsky performance status of one or less. The subject are required to be over  eight kg with measurable tumor lesions by caliper or imaging, either primary or metastatic,  that may or may not have had prior non-immunological-based therapy. No concurrent NSAID therapy is allowed and previous use of immune-based therapies is not permitted. Subjects are required to have a two month life expectancy, and, not have any disease or condition (other than the cancer)  that would preclude living for 3 to 6 months.

 

Toxicity is evaluated prior to, and after, treatment and monthly for a period of 3 months. To date, subjects have been recruited solely from patients of the McDonald Animal Hospital in order that the therapy may be administered licensure under the exemption provided by 9 CFR 107.1, which exempts a veterinary biologic from Federal regulation if the product was manufactured by veterinarians AND intended solely for use with their clients' animals under a veterinarian-client-patient (VCP) relationship. To date, 3 dogs have been enrolled in the safety study with none exhibiting any adverse effects. The Company estimates that an additional $100,000 will be required to be expended to complete the safety study.

 

Subsequent to completion of the safety study and pending favorable results, the Company plans to offer ImenVax™ I to its own patients under the exemption provided by 9 CFR 107.1, which exempts a veterinary biologic from Federal regulation if the product was manufactured by veterinarians AND intended solely for use with their clients' animals under a veterinarian-client-patient (VCP) relationship subject to the successful acquisition of one or more veterinary clinics by the Company.

 

ImenVax ™  II

 

Also in early stage development by the Company is a version of ImenVax ™  called ImenVax ™  II which utilizes cell lines for sustained release of immunologically relevant cytokines for maximum anti-tumor immune responses. It is believed by the Company that this controlled release of cytokines will act as an adjuvant to be combined with patient’s tumor cells (antigens) within an implantable membrane encapsulation device.

 

ImenVax ™  II is designed to function in a manner similar to ImenVax™ I. However, In order to further potentiate the tumor antigen specific immune responses, the Company intends to include adjuvant cytokine(s) along with tumor cells into the implantation device.   The adjuvants can be added through cytokine expressing cell line. The implantation device to be utilized for administering ImenVax ™  II is expected to be substantially similar to that utilized in administering ImenVax™ I.

  

ImenVax ™  III

 

ImenVax III is intended to function by harnessing the ability of placental extracts to combat canine cancers. ImenVax™III is intended to treat existing tumors through stimulation of immune responses to:

 

a) kill tumor cells directly;

b) indirectly kill tumor cells by cutting off the tumor blood supply; and

c) block the ability of the tumor to suppress the immune system.

 

Xenogeneic (from different species) antigen induced immunity has been shown to break self tolerance and capable of engendering immune responses against the endogenous counterpart self - antigen. The use of xenogeneic placental derived agents such as VEGF (vascular endothelial growth factor) has demonstrated regression of soft tissue sarcomas in dogs (Kamstock D, Elmslie R, Thamm D, Dow S. 2007. Evaluation of a xenogeneic VEGF vaccine in dogs with soft tissue sarcoma. 56(8): 1299 - 309).  

 

ImenVax ™  III is intended to be an off the shelf formulation, manufactured under GMP, which shall harness the power of trophoblasts (cells forming the outer layer of a blastocyst, which provide nutrients to the embryo and develop into a large part of the placenta) derived  from human placental tissue to combat canine cancers . No tissue processing is required for the administration of the ImenVax ™  III therapy as opposed to I and II as no cellular material from the patient is utilized.

 

ENT-576 ™

 

ENT-576 ™  is a proprietary therapy being developed by the Company for the treatment of Chronic Obstructive Pulmonary Disease (COPD) such therapy comprising of:

 

a) extracting a therapeutic number of cells from a tissue containing in part a stem cell population;

 

b) processing said population of cells derived from said tissue so as to concentrate said stem cell population;

 

c) systemic re-administration of said cell population into the same patient; and

 

d) exposing the patient lung to a sufficient intensity and frequency of laser irradiation necessary to augment therapeutic activity of said cells in said patient suffering from COPD. The Company has also considered utilizing an FDA approved biochemical drug to produce the desired augmentation of therapeutic activity.

 

A therapeutic intervention in COPD would require addressing the issues of inflammation and regeneration. Although approaches such as administration of bone marrow stem cells or fat derived cellular components have both regenerative and anti-inflammatory activity in animal models, the Company feels that the need to enhance their potency for clinical applications can be addressed through the usage of low level lasers which studies have demonstrated may induce growth factor production, inhibit  inflammation and  stimulate angiogenesis.

 

There can be no assurance that approvals required will be obtained for any of the Company’s current therapies under development, or that if such approvals are obtained that the Company will be able to effectively market its therapies. There can be no assurance given that actual costs and timeframes related to commercialization for any proposed product will not deviate materially from the Company’s estimation. Currently, none of the Company’s products under development may be administered or marketed in the United States or outside of the United states except pursuant to an exemption from relevant regulation. The Company does not anticipate conducting further research and development related to ENT-576™ until completion of the Safety Study due to limited resources available to the Company.

 

Distribution methods of the products or services:

 

The Company intends to distribute its products and services through several channels including:

 

  (a) utilization of an internal sales force to market directly to veterinary professionals
  (b) distribution through acquired veterinary clinics if and when such clinics are acquired
  (c) utilization of contract sales organizations

 

On October 19, 2011 the Company entered into an agreement with RenovoCyte  LLC and Medistem Inc. (“Agreement”)  whereby the Company shall provide research services to RenovoCyte  LLC in connection with a ten dog pilot study to determine the safety and effectiveness of the utilization of stem cell therapy for the treatment of arthritis in animals (“Pilot Study”). The term of the Agreement is from October 19, 2011 until the earlier of the completion of the Pilot Study or October 19, 2015 unless terminated by RenovoCyte LLC due to an event of force majeure exceeding a period of 4 months. As consideration for providing services pursuant to the Agreement, the Company shall enjoy joint publishing rights with regards to the results of the Pilot Study.  Canine mesenchymal multipotent stem cell injections to be utilized during the course of the Pilot Study shall be provided to the Company by RenovoCyte LLC at no cost to the Company.

 

As of November 21, 2014 there have been 8 canine patients treated through the Pilot Study. 

 

Competitive business conditions and Entest's competitive position in the industry and methods of competition

  

We have yet to achieve revenues or profits. The animal health pharmaceutical and biologics industries in which we intend to compete are highly competitive and characterized by rapid technological advancement. Many of our competitors have greater resources than we do. Also, The companion animal healthcare industry (e.g. veterinary hospitals and veterinarians) although highly fragmented is also highly competitive.

 

We intend to be competitive by acquiring veterinary hospitals to serve as distribution channels for the products and services we produce. We also intend to be competitive by utilizing the services and advice of individuals that we believe have expertise in their field in order that we can concentrate our resources on projects in which products and services in which we have the greatest potential to secure a competitive advantage may be developed and commercialized .

 

To that effect, we have established a Scientific Advisory Board of (the Advisory Board) comprised of individuals who we believe have a high level of expertise in their professional fields and who have agreed to provide counsel and assistance to us in (a) determining the viability of proposed projects (b) obtaining financing for projects and (c) obtaining the resources required to initiate and complete a project in the most cost effective and rapid manner. The members of the Advisory Board have also agreed to act as consultants on a project by project basis in addition to other services they may provide under any other contractual obligations to us.

 

Members of the Advisory Board include as follows:

 

Dr. Brian Koos, MD:

 

Dr. Brian Koos is Professor and Vice Chair at Obstetrics and Gynecology at the David Geffen School of Medicine at UCLA, Professor at the Brain Research Institute at the UCLA School of Medicine, and Director of the Maternal-Fetal Medicine Fellowship (UCLA). Dr. Koos received his MD from Loma Linda University School of Medicine. Dr. Brian Koos is the brother of David R. Koos, the Company’s Chairman, President and CEO.

 

Dr. Koos serves as a member of the Advisory Board pursuant to an agreement by and between the Company and Bio-Matrix Scientific Group, Inc. entered into on June 19, 2009 whereby the Bio Matrix Scientific Group, Inc assigned its rights to the services of Dr. Koos to the Company for consideration to bio matrix Scientific Group of $10,000. Those rights included the services of Dr. Koos as a member of the Company’s Advisory Board for a period ending April 8, 2014. Dr. Koos serves as a member of the Advisory Board at will and at the pleasure of the Board of Directors of the Company. There is no binding agreement by and between the Company and Dr. Koos regarding membership on the Advisory Board. 

 

Dr. Steven Josephs, PhD:

 

Dr. Josephs is currently serving as Executive Manager and Chief Scientific Officer of TherInject LLC, a company involved in the development of pharmaceuticals to be utilized for the treatment of cancer. Dr. Josephs has 34 years of experience in research and clinical product development and production for biologics, gene therapy and medical devices.

 

Dr. Josephs has previously served as Director of Research and Development for Therapheresis, Inc, Head of Virology and Senior Research Scientist for Baxter Healthcare Corporation, and Director of Molecular Biology at Universal Biotechnology, Inc where Dr. Josephs directed a group performing contract molecular biology services for government and private industry.

 

Dr. Josephs has also worked for the National Cancer Institute where his duties included studies of the human T-cell leukemia virus as well as sequence determination and functional analyses of HIV. Dr. Josephs is the co-discoverer of human herpesvirus-6, the etiologic agent of Roseola.

 

Dr. Josephs holds a B.A. in Chemistry, a Ph.D. in Chemistry and has been granted a Professional Certificate in Drug Development and an ADMET process certificate by the University of California, San Diego. Dr. Josephs has also earned a Master of Science in Science Teaching.

Dr. Josephs serves as a member of the Advisory Board at will and at the pleasure of the Board of Directors of the Company. There is no binding agreement by and between the Company and Dr. Josephs regarding membership on the Advisory Board.

 

Dr. Ewa Carrier, MD:

 

Dr. Carrier is Associate Professor of Clinical Medicine and Pediatrics, University of California San Diego Blood and Marrow Transplant Program.

 

Dr. Carrier has served as principal investigator for the following clinical protocols:

 

Protocol For The Use of AMD3100 to Mobilize Peripheral Blood Stem Cells For Collection and Transplantation - Emergency Compassionate Use, Single Patient IND.

 

Erythropoietic Differentiation of Human ES Cells.

 

CTLA-4 Blockade with MDX-010 to Induce Graft-Versus-Malignancy Effects Following Allogeneic Hematopoietic Stem Cell Transplantation. (NCI Protocol Number P-6082) (closed to accrual).

 

Phase 3 Randomized, Open-label Clinical Trial of Tanespimycin (KOS-953) plus Bortezomib Compared to Bortezomib Alone in Patients with Multiple Myeloma in First Relapse [Protocol KAG-301] [Protocol Version 21-JUL-2007] Autologous Stem Cell Transplant for Myasthenia Gravis.

 

Collection of Bone Marrow from Patients with Multiple Myeloma for Study of New Therapies.

 

A Pilot Study of High-Dose Immunosuppression and Autologous Stem Cell Infusion in Patients with Systemic Lupus Erythematosus Refractory to Conventional Therapy (closed to accrual).

 

Autologous Stem Cell Transplant for Myasthenia Gravis – a retrospective analysis.

 

Dr Carrier has served as co investigator for the following clinical protocols:

 

Pilot Study of Allogeneic Peripheral Blood Progenitor Cell Transplantation in Patients with Chemotherapy-Refractory or Poor- Prognosis Metastatic Breast Cancer.

 

Pilot Study of a Non-Myeloablative Preparative-Regimen for Allogeneic Peripheral Blood Progenitor Cell Transplantation in Patients with Chronic Myeloid and Lymphoid Malignancies.

 

Phase II Study of a Non-Myeloablative Preparative-Regimen for Allogeneic Hematopoietic Cell Transplantation From Matched Unrelated Donors in Patients with Chronic Myeloid and Lymphoid Malignancies.

 

A Phase II Study of Tumor-Specific Idiotype (Id) and Soluble GM-CSF Vaccination Following Autologous Peripheral Blood Stem Cell Transplantation in Patients with Low-Grade Non-Hodgkin's Lymphomas.

 

Phase II Study of FavId (Tumor-Specific Idiotype-KLH) and Soluble GM-CSF Immunotherapy in Patients with Stable or Progressive Grade 1 or 2 Follicular B-Cell Lymphomas [FavId01].

 

Phase II Trial of Rituxan® plus FavId™ (Tumor-Specific Idiotype-KLH) and GM-CSF Immunotherapy in Patients with Grade 1 or 2 Follicular B-Cell Lymphoma [FavId-04].

 

Dr. Carrier serves as a member of the Advisory Board at will and at the pleasure of the Board of Directors of the Company. There is no binding agreement by and between the Company and Dr. Carrier regarding membership on the Advisory Board 

 

Dr. Feng Lin, MD:

 

Dr. Lin is the Director of Research and Development of Entest BioMedical, Inc. and has previously served as Director of Research and Development of Bio-Matrix Scientific Group, Inc., the Company’s largest shareholder.

 

Previously, Dr. Lin was a Senior Research Scientist, Research & Development with Inovio BC, San Diego and Postdoctoral Fellow in Burnham Institute for Medical Research, La Jolla.

Dr. Lin received his M.D. from Central South University Xiangya School of Medicine, Changsha, China, and received a M.S. Biochemistry & Molecular Biology and a Ph.D. Hematology & Physiology from the same institution.

 

Dr. Lin serves as a member of the Advisory Board at will and at the pleasure of the Board of Directors of the Company. There is no binding agreement by and between the Company and Dr. Lin regarding membership on the Advisory Board.

 

Brenda S. Phillips, D.V.M.

 

Dr. Phillips is a veterinary oncologist and co owner of Veterinary Specialty Hospital of San Diego. She received her Doctor of Veterinary Medicine in 1992 from Michigan State University, College of Veterinary Medicine.

 

Dr. Phillips agreed on January 6, 2011 to serve as a member of the Advisory Board for a period of 24 months. In connection with that agreement, Dr. Phillips received 10,000 common shares of the Company. Dr. Phillips serves as a member of the Advisory Board at will and at the pleasure of the Board of Directors of the Company. There is no binding agreement by and between the Company and Dr. Phillips regarding membership on the Advisory Board.

 

The U.S. market for veterinary services is highly fragmented. According to the American Veterinary Medical Association, there were more than 51,000 veterinarians practicing at the end of 2009. The principal factors in a pet owner’s decision as to which veterinarian to use include convenient location and hours, personal recommendations, reasonable fees and quality of care. In order to be competitive in the animal healthcare industry, we intend to direct our marketing efforts related to clinics, if and when they may be acquired, toward increasing the number of annual visits from existing clients through customer education efforts and toward attracting new clients through local print advertising campaigns. 

 

 
 

  

Sources and availability of raw materials and the names of principal suppliers

 

The supplies and materials required to conduct our operations are available through a wide variety of sources and may be obtained through a wide variety of sources.

 

Patents, trademarks, licenses, franchises, concessions, royalty agreements or labor contracts, including duration

 

Entest has not been granted any patents. Entest is not currently party to any royalty agreements.  Entest is not party to any binding labor contracts.

 

Need for any government approval of principal products or services, effect of existing or probable governmental regulations on the business

 

ImenVax™ I and ImenVax™ II are Veterinary Biologics. The U.S. Department of Agriculture (USDA) is authorized under the 1913 Virus-Serum-Toxin Act to ensure that all veterinary biologics produced in, or imported into, the United States are not worthless, contaminated, dangerous, or harmful. The Veterinary Biologics Program of the USDA's Animal and Plant Health Inspection Service (“APHIS”) oversees the veterinary biologics industry in the United States.

 

Domestic manufacturers of veterinary biologics, for domestic use or for export, are required to possess a valid U.S. Veterinary Biologics Establishment License and an individual U.S. Veterinary Biologics Product License for each product produced for sale.

 

Prior to being granted a U.S. Veterinary Biologics Product License, the applicant must submit detailed information including test reports and research data sufficient to establish purity, safety, potency and efficacy of the product, an Outline of Production, and information regarding labeling and  facilities that are to be used in preparation.

 

Prior to being granted a U.S. Veterinary Biologic Establishment License, the applicant must submit detailed information regarding the facilities and the qualifications of key personnel and must submit to an inspection of the facilities by the Center for Veterinary Biologics, a division of the USDA. To qualify for an establishment license, an applicant also must qualify for at least one product license.

 

In the event that a veterinary clinic or clinics can be acquired, the Company plans to attempt to distribute ImenVax™ I prior to licensure under the exemption provided by 9 CFR 107.1, which exempts a veterinary biologic from Federal regulation if the product was manufactured by veterinarians AND intended solely for use with their clients' animals under a veterinarian-client-patient (VCP) relationship.

 

ENT-576™ can be considered a “combination product” whose primary mode of action is through animal stem cells (a veterinary biologic) It is intended that the Company will obtain a U.S. Veterinary Biologics Establishment License and a U.S. Veterinary Biologics Product License from the U.S. Department of Agriculture. ENT-576™ can also be administered without license if administered in accordance with the safe harbor provided by 9 CFR 107.1.

 

ImenVax™ III can be considered a combination product whose primary mode of action is generated through trophoblasts derived from human placental tissue. Entest will be required to obtain approval from the US Food and Drug Administration (FDA) in order to market ImenVax™ III. Entest will apply for an Investigational New Animal Drug exemption (INAD) in order that the product may be shipped for testing and trials and will submit a New Animal Drug Application for ImenVax™ III.

 

The practice of veterinary medicine is primarily subject to State regulation. The Company will be required to comply with the statutes rules and regulations of the State in which an acquired veterinary clinic is located. Within the State of California, where the Company is focusing its acquisition efforts ,  the practice of veterinary medicine  is primarily governed pursuant to The California Veterinary Medicine Practice Act (CA Bus.& Prof. Code § 4800 et seq.). 

Amount spent during the last fiscal year on research and development activities

 

During the fiscal year ended August 31, 2014 we expended $0 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 21, 2014, Entest has 1 employee of which 1 is full time.

  

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

 

This property is utilized as office space. The Company believes that the foregoing property is adequate to meet its current needs. While it is anticipated that the Company will require access to laboratory facilities in the future, the Company believes that access to such facilities are available from a variety of sources.

 

Item 3. Legal Proceedings

 

On May 24, 2012, a Complaint (“Complaint”) was filed in the U.S. Bankruptcy Court for the District of Oregon against the Company by Titterington Veterinary Services Inc. (“TVS”). The Complaint is an adversary proceeding filed by TVS arising from TVS’s bankruptcy case currently pending in U.S. Bankruptcy Court for the District of Oregon. The Complaint alleges Breach of Contract resulting from the Company’s alleged failure to pay certain expenses the Company was required to pay pursuant to an agreement with TVS, Dr. Ronald Titterington, DVM and Dr. Kathy Snell, DVM (“TVS Agreement”). TVS is seeking a judgment and money award against the Company in an amount to be proven at trial which TVS estimates in the Complaint to be up to $50,000. TVS is also seeking a judgment and order against the Company to provide an accounting of all revenues received by the Company pursuant to the TVS Agreement, all expenses paid, unpaid, and due and owing pursuant to the TVS Agreement as well as a revenue share which TVS claims is due them pursuant to the TVS Agreement. TVS is also seeking a judgment requiring the Company to turn over a sum of money equal to expenses the Company was obligated to pay pursuant to the TVS Agreement. TVS is also seeking attorney’s fees and expenses. The Company believes that the allegations in the complaint are without merit and intends to vigorously defend its interests in this matter. At this time, it is not possible to predict the ultimate outcome of these matters and an outcome unfavorable to the Company may have a material adverse effect on the Company. On September 19, 2012 the Plaintiff’s Claim for Relief for turnover and an accounting under 11 U.S.C. § 542 and the Plaintiff's Claim for Relief for attorney fees were dismissed with prejudice and , as per the claim of breach of contract, the proceeding was transferred to the United States Bankruptcy Court for the District of Southern California for all further proceedings. On September 19, 2012 the Plaintiff’s Claim for Relief for turnover and an accounting under 11 U.S.C. § 542 and the Plaintiff's Claim for Relief for attorney fees were dismissed with prejudice and , as per the claim of breach of contract, the proceeding was transferred to the United States Bankruptcy Court for the District of Southern California for all further proceedings. This Complaint was dismissed in its entirety on June 30, 2014.

 

There were no other legal proceedings against the Company with respect to matters arising in the ordinary course of business. The Company is not involved in any other litigation either as plaintiffs or defendants, and has no knowledge of any threatened or pending litigation against the Company.

 

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 6,000,000,000 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 200,000 shares authorized of Non Voting Convertible Preferred Stock, par value $1.00   As of November 21, 2014 the Company had 2,405,570, 642 common shares outstanding, 3, 201,397 Series B Preferred shares outstanding , 100,000 Series AA preferred shares outstanding and 80,000 Series AAA preferred shares outstanding .

 

 

(a) Our common stock is traded on the OTC Pink Tier of OTC Markets under the symbol "ENTB”.  Below is the range of high and low bid information for our common equity for each quarter within the last two fiscal years. These quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.

 

 

 

September 1, 2013 to August 31, 2014   High     Low  
First Quarter   $ 0.0014     $ 0.0002  
Second Quarter     0.0009       0.0003  
Third Quarter     0.0016       0.0004  
Fourth Quarter   $ 0.0007     $ 0.0003  

 

September 1, 2012 to August 31, 2013   High     Low  
First Quarter   $ 0.0053     $ 0.0007  
Second Quarter     0.0073       0.0005  
Third Quarter     0.0064       0.0016  
Fourth Quarter   $ 0.0012     $ 0.0030  

 

Holders

  

As of August 31, 2014 there were approximately 341 holders of our Common Stock.

 

Dividends

 

No cash dividends were paid during the fiscal year ending August 31, 2014. We do not expect to declare cash dividends in the immediate future.

 

Recent Sales of Unregistered Securities

 

On September 4, 2013 The Company issued 27,887,324 of its common shares (“Shares) in satisfaction of $19,800 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On September 16, 2013 The Company issued 28,000,000 of its common shares (“Shares”) in satisfaction of $12,600 of convertible notes payable.

 

 The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On September 20, 2013 The Company issued 20,820,513 of its common shares (“Shares”) in satisfaction of $5,600 of convertible notes payable and $2,520 of accrued interest on convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On September 23, 2013 The Company issued 39,325,397 of its common shares (“Shares”) in conversion of 24,775 of the Company’s Non Voting Convertible Preferred Stock

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On September 24, 2013 The Company issued 27,9487,18 of its common shares (“Shares”) in satisfaction of $10,900 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On September 27, 2013 The Company issued 27,9487,18 of its common shares (“Shares”) in satisfaction of $10,900 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On September 30, 2013 The Company issued 60,000,000 of its common shares (“Shares”) in satisfaction of $13,550 of notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

 On October 2, 2013 The Company issued 24,848,485 of its common shares (“Shares”) in satisfaction of $8,200 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On October 8, 2013 The Company issued 27,727,273 of its common shares (“Shares”) in satisfaction of $6,100 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On October 9, 2013 The Company issued 28,000,000 of its common shares (“Shares”) in satisfaction of $5,600 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On October 10, 2013 The Company issued 27,777,778 of its common shares (“Shares”) in satisfaction of $5,000 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On October 14, 2013 The Company issued 60,000,000 of its common shares (“Shares”) in satisfaction of $13,550 of notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On October 15, 2013 The Company issued 27,777,778 of its common shares (“Shares”) in satisfaction of $5,000 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On October 18, 2013 The Company issued 20,652,000 of its common shares (“Shares”) in satisfaction of $3,300 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On October 22, 2013 The Company issued 55,000,000 of its common shares (“Shares”) in satisfaction of $6,600 of convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On October 24, 2013 The Company issued 27,500,000 of its common shares (“Shares”) in satisfaction of $1,400 of convertible notes payable and $1,900 of accrued interest on convertible notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On November 23, 2013 The Company issued 60,000,000 of its common shares (“Shares”) in satisfaction of $13,550 of notes payable.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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. 

 

On January 20, 2014 the Company issued to David Koos, the Company’s Chairman and CEO, 95,000 shares of the Company’s Series AA Preferred Stock (“Shares”) in satisfaction of $10,000 of salary accrued but unpaid owed to David Koos.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On January 24, 2014 the Company issued to David Koos, the Company’s Chairman and CEO, 1,000,000 shares of the Company’s Series B Preferred Stock (“Shares”) in satisfaction of $1,000 of salary accrued but unpaid owed to David Koos.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On January 24, 2014 the Company issued to David Koos, the Company’s Chairman and CEO, 15,000,000 shares of the Company’s Common Stock (“Shares”) in satisfaction of $15,000 of principal indebtedness owed to David Koos.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On January 28, 2014 the Company issued 115,000,000 shares of the Company’s Common Stock (“Shares”) in satisfaction of $10,506 of principal indebtedness.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On March 3, 2014 the Company issued 125,000,000 shares of the Company’s Common Stock (“Shares”) in satisfaction of $12,500 of principal indebtedness.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On March 13, 2014 the Company issued 140,000,000 shares of the Company’s Common Stock (“Shares”) in satisfaction of $14,000 of principal indebtedness.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On March 28, 2014 the Company issued 155,000,000 shares of the Company’s Common Stock (“Shares”) in satisfaction of $15,500 of principal indebtedness

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On April 22, 2014 the Company issued 170,000,000 shares of the Company’s Common Stock ( Shares) in satisfaction of $17,000 of principal indebtedness

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On May 16, 2014 the Company issued 125,000,000 shares of the Company’s Common Stock (“Shares”) in satisfaction of $12,500 of principal indebtedness.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On May 22, 2014 the Company issued 80,000 shares of Series AAA Preferred Stock (“Shares”) to David R. Koos, the Company’s Chairman, President and CEO as consideration for $10,000 of salary accrued and unpaid owed to David R. Koos by the Company.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On August 7, 2014 the Company issued 195,000,000 shares of the Company’s Common Stock(“Shares”) in satisfaction of $19,500 of principal indebtedness.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On August 11, 2014 the Company issued 12,500,000 shares of the Company’s Common Stock (“Shares”) as compensation to an employee.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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.

 

On October 22, 2014 the Company issued 200,000,000 shares of the Company’s Common Stock(“Shares”) in satisfaction of $20,000 of principal indebtedness.

 

The Shares were issued pursuant to Section 4(a) (2) of the Securities Act of 1933, as amended. 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, 2014, we had Cash in the amount of $734 and as of August 31, 2013 we had Cash in the amount of $9,610.

 

The decrease in Cash of approximately 92% is attributable to attributable to expenses incurred by the Company in the operation of its business and payment of its obligations partially offset by funds received by the Company as a result of net borrowings.

 

As of August 31, 2014 we had Due from an Affiliate of $0 and as of August 31, 2013 we had Due from an Affiliate of $34,895.

 

The decrease in Due from an Affiliate of approximately 100% is attributable to the payment of $34,895 to the Company by Bio Matrix Scientific Group, Inc during the year ended August 31, 2014.

 

 As of August 31, 2014 we had Intangible Assets of $0 and as of August 31, 2013 we had Intangible Assets of $270.

The decrease in Intangible Assets of approximately 100% is attributable to amortization expenses recognized during the year ended August 31, 2014.

As of August 31, 2014 we had Accounts Payable of $115,849 and as of August 31, 2013 we had Accounts Payable of $101,615.

The increase in Accounts Payable of approximately 14% is primarily attributable to increases in outstanding obligations of the Company incurred in the course of business.

 

As of August 31, 2014 we had Notes Payable of $383, 440 and as of August 31, 2013 we had Notes Payable of $272,644

The increase in Notes Payable of approximately 40% is primarily attributable to :

 

  (a) Net Borrowings during the year ended August 31, 2014 of $5,230 from David Koos, the Company’s CEO

  (b) Borrowings during the year ended August 31, 2014 of $10,422 from Regen Biopharma, Inc., a company of which David Koos is CEO and Chairman of the Board of Directors

  (c) Borrowings during the during the year ended August 31, 2014  from third party lenders of $75,000

 (d) The reclassification of $200,000 of accrued salaries to Notes Payable during the quarter ended February 28, 2014

Offset by:

(a)Satisfaction of $128,606 of principal debt owed to third party lenders through the issuance of equity securities of the Company during the year ended August 31, 2014
(b)Satisfaction of $15,000 of principal debt owed to David Koos through the issuance of equity securities of the Company during the year ended August 31, 2014
(c)Forgiveness by the lender of $5,750 of principal debt during the quarter ended November 20, 2013

As of August 31, 2014 we had Convertible Notes Payable, Net of Discount of $0 and as of August 31, 2013 we had Convertible Notes Payable, Net of Discount of $101,000

 

The decrease in Convertible Notes Payable, Net of Discount of approximately 100% is primarily attributable to conversions of principal amounts of convertible indebtedness into the common shares of the Company. 

As of August 31, 2014 we had Accrued Expenses of $182,549 and as of August 31, 2013 we had Accrued Expenses of $258,313.

 

The decrease in Accrued Expenses of approximately 29%  is primarily attributable to:

(a)The reclassification of $200,000 of accrued salaries to Notes Payable during the quarter ended February 28, 2014
(b)The satisfaction of $11,000 of accrued salaries through the issuance of equity securities during the six months ended February 28,2014

 

Offset primarily by accrual of salary due and payable to David Koos of $120,000 during the twelve months ended August 31, 2014, accrual of salary due to an employee of $3,709 during the twelve months ended August 31, 2014 as well as additional accruals of interest and payroll tax payable during the twelve months ended August 31, 2014.

 

Material Changes in Results of Operations

 

Revenues from continuing operations were $0 for the fiscal year ended August 31, 2014 and $0 for the fiscal year ended August 31, 2013 . Net losses from continuing operations were$1,416,943 for the fiscal year ended August 31, 2014 and $1,293,583 for the fiscal year ended August 31, 2013.

 

The increase in Net Losses from continuing operations of approximately 9% is primarily attributable to the recognition by the Company of $600,994 of losses attributable to issuance of stock below fair value, an increase of approximately 646% of expenses attributable to issuance of common stock below par value, a decrease in other income recognized of 91% when compared to the year ended August 31, 2013 and the recognition of $61,168 during the year ended August 31, 2013 attributable to a Gain on Derecognition of Liabilities due to the Divestiture of the McDonald Animal Hospital offset primarily by:

 

(1)Lower Rental , General and Administrative , Interest, and Consulting expenses recognized in the year ended August 31, 2014 when compared to the same period ended 2013
(2)Recognition of a $22,906 one time loss on assets disposed of in the disposition of the McDonald Animal Hospital during the quarter ended November 30, 2012.
(3)Recognition of a Goodwill impairment charge of $405,000 attributable to the disposition as of November 30, 2012 of certain assets related to the McDonald Animal Hospital
(4)$140,307 of interest attributable to amortization of Beneficial Conversion Features recognized during the year ended August 31, 2013
(5)Gain on issuance of stock for greater than fair value of $6,000 recognized during the year ended August 31, 2014
(6)Penalties of $63,000 incurred pursuant to terms and conditions of Convertible Debentures recognized during the year ended August 31, 2013

 

As of August 31, 2014 we had $734 cash on hand and current liabilities of $689,838 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 and shall be required to seek additional financing.

 

We currently plan to raise additional funds primarily by offering securities for cash and acquiring existing veterinary clinics with the ability to generate cash flow to fund operations.

 

There is no guarantee that we will be able to raise any capital through any type of offerings. We can provide no assurance that we can acquire veterinary clinics which can generate sufficient cash flow to neither fund our operations nor can any assurance be made that we can acquire one or more additional veterinary clinics in the near future or at all. We cannot assure that we will be successful in obtaining additional financing necessary to implement our business plan. We have not received any commitment or expression of interest from any financing source that has given us any assurance that we will obtain the amount of additional financing in the future that we currently anticipate. For these and other reasons, we are not able to assure that we will obtain any additional financing or, if we are successful, that we can obtain any such financing on terms that may be reasonable in light of our current circumstances.

 

As of November 21, 2014 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.

Item 8. Financial Statements and Supplementary Data

 

SEALE AND BEERS, CPAs

PCAOB REGISTERED AUDITORS

www.sealebeers.com

 

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

To the Board of Directors and Stockholders of

Entest Biomedical Inc.

(A Development Stage Company)

 

We have audited the accompanying consolidated balance sheets of Entest Biomedical, Inc. (A Development Stage Company) as of August 31, 2014 and 2013, and the related statements of operations, stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended August 31, 2014 and since inception on August 22, 2008 through August 31, 2014. Entest Biomedical, Inc’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, 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. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

 

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Entest Biomedical, Inc. (A Development Stage Company) as of August 31, 2014 and 2013, and the related statements of operations, stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended August 31, 2014 and since inception on August 22, 2008 through August 31, 2014 in conformity with accounting principles generally accepted in the United States of America.

 

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, 2014, 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.

 

 

Seale & Beers, CPAs

 

Seale and Beers, CPAs

Las Vegas, Nevada

November 21, 2014

 

8250 W. Charleston Blvd., Suite 100, Las Vegas, NV 89117 Phone: (888)727-8251 Fax: (888)782-2351

 

 
 

 

ENTEST BIOMEDICAL, INC.    
( A Development Stage Company)    
Consolidated Balance Sheet    
     
    As of As of
    August 31, 2014 August 31, 2013
       
ASSETS      
Current Assets    
  Cash 734 9,610
  Due from Affiliate 0 34,895
  Current Portion of Prepaid Expenses 8,000 8,000
Total Current Assets 8,734 52,505
       
Property & Equipment (Net of Accumulated Depreciation) 1,919 1,919
Intangible Assets (Net of Accumulated Amortization) 0 270
       
       
       
TOTAL ASSETS 10,653 54,694
       
LIABILITES AND STOCKHOLDERS' EQUITY    
Current Liabilities    
  Accounts Payable 115,849 101,615
  Notes Payable 383,440 272,644
  Convertible notes payable, net of discount   101,000
  Due to Other 8,000 8,000
  Accrued Expenses 182,549 258,313
Total Current Liabilities 687,838 741,572
       
       
TOTAL LIABILITIES 687,838 741,572
       
STOCKHOLDERS' EQUITY    
Common Stock,  authorized 6,000,000,000 shares;    
  issued and outstanding   561,856,768 (par value $0.001) shares and 2,205,570,752(par value $0.0001)    
  as of August 31, 2013 and  2014 respectively 219,657 561,855
Preferred Stock ,par value  $0.0001  5,000,000 shares authorized,    
  0 shares issued and outstanding as of August 31,2013  and August 31, 2014    
  Series AA Preferred Stock,  100,000 shares authorized,    
  5,000 shares, par value $0.001,  issued and outstanding at August 31, 2013  and    
    and 100,000 shares (par value $0.0001) as of August 31, 2014 10 5
  Series B Preferred 421 3,201
   4,400,000 shares authorized, 3,201,397 ( par value $0.001)    
  issued and outstanding as of  August 31, 2013 and  4,201, 397 (par value $0.0001)    
  issued and outstanding as of August 31, 2014    
  Series AAA Preferred, 300,000 shares authorized, $0.0001 par value 8 0
  0 and 80,000 shares outstanding as of August 31, 2013 and August 31, 2014 respectively    
  NonVoting Convertible Preferred 0 24,775
  ($1 par value) 200,000 shares authorized, 24,775 and 0    
  issued and outstanding as of August 31, 2013 and  2014,respectively    
Additional Paid in Capital 5,239,692 3,441,563
Contributed Capital 274,162 274,162
Accumulated Deficit (6,413,135) (4,992,439)
       
Total Stockholders' Equity (679,185) (686,878)
       
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY 10,653 54,694

 

The Accompanying Notes are an Integral Part of these Financial Statements.

 

 
 

 

 

ENTEST BIOMEDICAL INC.         
( A Development Stage Company)         
Consolidated Statement of Operations       
   Year ended  Year ended  Inception to
   August 31,
2014
  August 31, 2013  August 31 2014
          
TOTAL REVENUE   0    0    0 
                
                
COSTS AND EXPENSES               
Research and Development   0    0    145,794 
Rent Costs   38,517    37,032    247,477 
General and Administrative   265,566    514,310    2,233,043 
Incorporation Costs             408 
Consultant's Expenses   76,032    111,655    926,098 
Miscellaneous Expenses             78 
Total Costs and Expenses   380,115    662,887    3,552,898 
                
OPERATING LOSS   (380,115)   (662,997)   (3,552,898)
                
OTHER INCOME AND EXPENSE               
Other Income   5,700    70,475    171,223 
Gain on issuance of stock at above fair value   6,000         6,000 
Penalties on Convertible Debentures        (63,000)   (63,000)
Loss on derecognition of assets due to divestiture        (22,906)   (22,906)
Loss on issuance of stock below fair value   (600,994)        (600,994)
Loss on Early Extinguishment of Debt             (18,647)
Income generated from revenue             187,699 
  Share Agreement               
Expenses incurred from Revenue               
  Share Agreement             (145,362)
Loss on Impairment of intangible             (683,333)
  assets               
Interest Expense   (27,165)   (41,762)   (129,806)
Interest Expense attributable to               
   amortization of discount        (140,307)   (537,215)
Loss on Impairment of Goodwill        (405,000)   (405,000)
Gain on derecognition of Liabilities due to               
Divestiture        61,168    61,168 
Expense attributable to issuance of common shares               
below par value   (420,369)   (56,343)   (476,712)
Expense attributable to issuance               
of shares pursuant to contractual               
obligation        (32,911)   (56,779)
Expense attributable to issuance of               
  Non Voting Convertible Preferred               
Shares in connection with Stock               
Purchase Agreement             (75,000)
TOTAL OTHER INCOME AND EXPENSE   (1,036,828)   (630,586)   (2,788,664)
                
LOSS BEFORE INCOME TAXES   (1,416,943)   (1,293,583)   (6,341,562)
income Taxes   0    0    0 
                
NET LOSS   (1,416,943)   (1,293,583)   (6,341,562)
Beneficial conversion feature               
attributable to issuance of NonVoting               
  Preferred Stock             (32,142)
                
NET LOSS  from continuing               
 Operations   (1,416,943)   (1,293,583)   (6,373,704)
                
Net Income (Loss) from discontinued operations   (3,753)   (34,554)   (39,431)
                
NET LOSS available to common shareholders   (1,420,696)   (1,328,137)   (6,413,135)
                
BASIC AND DILUTED EARNINGS               
   (LOSS) PER SHARE FROM CONTINUING OPERATIONS   (0.001)   (0.003)     
                
BASIC AND DILUTED EARNINGS               
   (LOSS) PER SHARE FROM DISCONTINUED OPERATIONS   (0.000)   0.000      
                
                
WEIGHTED AVERAGE               
NUMBER OF COMMON               
SHARES OUTSTANDING   1,470,725,875.0    458,310,240      
                
                

 

The Accompanying Notes are an Integral Part of these Financial Statements.

 
 

 

Entest BioMedical, Inc.
 Consolidated Statement of Stockholders' Equity  
 From inception to August 31, 2014
                                             
   Common    Series AA Preferred  Series AAA Preferred  Series B Preferred Non Voting Convertible Preferred    Additional Paid-in    Contributed   Accumulated Deficit during the Development    
   Shares    Amount    Shares    Amount  Shares    Amount  Shares  Amount  Shares  Amount    Capital    Capital   Stage   Total
 Beginning balances Aug. 22, 2008                             -                           -                                               -                    -   0   0
 Shares issued to parent August 23, 2008                      1,500                       408                                     408
 Net Loss August 22, 2008                                            
   through August 31, 2008                                       (408)   (408)
                                             
 Balances August  31, 2008                        1,500                       408                                               -                    -   (408)   0
 Recapitalization in connection with                                            
    reverse acquisition July 10, 2009                    (1,500)                     (408)                                           408   0       0
              10,000,000                  10,000                                    (10,000)   0       0
 Common Shares issued in Reverse                                            
    Acquisition July 10, 2009               4,000,000                    4,000                                      (4,000)   0       0
 Increases in Contributed Capital                             -                           -                                               -   485       485
 Common Shares issued for Cash August 3, 2009               1,000,000                    1,000                                      99,000   0       100,000
 Restricted Stock Award issued to                                            
      employee August 3, 2009               2,000,000                    2,000                                      (2,000)   0       0
 Restricted Stock Award                                            
   compensation expense for the                                              
    year ended August 31, 2009                             -                           -                                      24,725   0       24,725
 Common Stock issued to                                            
    consultant August 31, 2009                    50,000                         50                                    199,950   0       200,000
 Net Loss year ended Aug. 31, 2009                                       (245,515)   (245,515)
Balance August 31 2009             17,050,000                  17,050                                    308,083   485   (245,923)   79,695
 Common Shares issued for Cash September 10,2009                  500,000                       500                                      49,500                    -                          -              50,000
 Restricted Stock Award                                            
    compensation expense for the                                              
    3 months ended Nov. 30, 2009                             -                           -                                      98,916                    -                          -              98,916
 Common Stock as Compensation October 5, 2009                      3,040                           3                                        4,557                    -                          -                4,560
 Increases in Contributed Capital                             -                           -                                               -             4,263                          -                4,263
 Restricted Stock Award                                              
    compensation expense for the                                            
    3 months ended February 28, 2010                             -                           -                                      76,359                    -                          -              76,359
 Increases in Contributed Capital                             -                           -                                               -           10,356                          -              10,356
 Net Loss year ended Aug. 31, 2010                             -                           -                                               -                    -             (544,891)          (544,891)
Balance August 31 2010             17,553,040                  17,553                                    537,415   15104   (790,814)   (220,742)
 Common Shares issued for Cash October 2 , 2010               2,000,000                    2,000                                      98,000                    -                          -            100,000
 Common Shares issued for Cash January 6 2011                  200,000                       200                                      99,800                    100,000
 Common Shares issued for cash january 4 2011                    17,600                         17                                      17,583                      17,600
 Common Shares issued for Debt January 3, 2011                    38,712                         37                                      39,952                    -                          -              39,989
 Common Shares issued for Debt April 4, 2011                  600,000                       600                                    250,578                    251,178
 Common Shares issued for Debt August 29 2011                  143,000                       143                                      49,857                      50,000
                                             
 Common Shares issued to Consultants 11/ 16/ 2010                    45,000                         45                                      53,055                    -                          -              53,100
 Common Shares issued to Consultants 11/ 30/ 2010                    10,000                         10                                        9,290                        9,300
 Common Shares issued to Consultants 2/4/2011                    10,000                         10                                      41,990                      42,000
 Common Shares issued to Consultants 1/4/2011                      9,383                           9                                      17,632                      17,641
 Common Stock issued to employees January 3, 2011                    38,000                         38                                      71,402                    -                          -              71,440
 Common Stock issued to employees January 14, 2011                  102,766                       103                                    193,097                    193,200
 Common Stock issued to employees  February4, 2011                      5,000                           5                                      20,595                      20,600
 Common Stock issued to employees march 25, 2011                      7,000                           7                                      14,923                      14,930
 Common Stock issued to employees August 11, 2011                    11,000                         11                                        3,218                        3,229
                                             
 Restricted Stock Awards issued to employee 4/ 1 /2011                    50,000                         50                                           (50)                    -                          -                       -
 Restricted Stock Award Compensation                                            
    expense recognized                             -                           -                                      10,000                    -                          -              10,000
 Discount on Convertible Debt recognized                             -                           -                                      88,998                    -                          -              88,998
 Increases in Contributed capital                             -                           -                                               -         259,058                          -            259,058
 Preferred Stock issued for Accrued compensation June 9, 2011                   5,000                    5                                1,995                        2,000
 Net Loss Year ended August 31, 2011                                                 (954,398)          (954,398)
 Discontinued operations                                                       2,615                2,615
Balance August 31 2011             20,840,501                  20,838   5000   5                         1,619,330   274162   (1,742,597)   171,738
Common Shares issued for services 10/07/2011 50,474   50                         17,950           18,000
Common Shares issued for services 11/22/2011 18,499   18                         4,565           4,583
Common Shares issued for services 1/10/2012 27,499   27                         8,241           8,268
Common Shares issued for services 2/26/2012 175,528   173                         52,225           52,398
Common Shares issued for services 3/14/2012 3,000,000   3,000                         85,500           88,500
Common Shares issued for intangible assets 11/11/2011 2,500,000   2,500                         697,500           700,000
Discount on Convertible Note Recognized                               350,915           350,915
Common Shares issued for debt 11/28/2011 134,983   134                         11,866           12,000
Common Shares issued for debt 12/12/2011 258,824   259                         10,741           11,000
Common Shares issued for debt 12/19/2011 338,983   339                         11,661           12,000
Common Shares issued for debt 1/27/2012 227,963   228                         7,272           7,500
Common Shares issued for debt 2/3/2012 528,821   529                         14,471           15,000
Common Shares issued for debt 2/16/2012 721,154   721                         14,279           15,000
Common Shares issued for debt 3/07/2012 2,322,695   2,323                         30,427           32,750
Common Shares issued for debt 3/21/2012 1,162,791   1,163                         13,837           15,000
Common Shares issued for debt 3/26/2012 1,411,765   1,412                         10,588           12,000
Common Shares issued for debt 3/21/2012 723,404   723                         9,477           10,200
Common Shares issued for debt 3/26/2012 1,605,737   1,606                         11,044           12,650
Common Shares issued for debt 4/02/2012 886,222   886                         3,102           3,988
Common Shares issued for debt 4/03/2012 1,590,909   1,591                         5,409           7,000
Common Shares issued for debt 4/02/2012 788,889   789                         2,761           3,550
Common Shares issued for debt 4/10/2012 1,944,444   1,944                         1,556           3,500
Common Shares issued for debt 4/10/2012 3,611,111   3,611                         2,889           6,500
Common Shares issued for debt 4/12/2012 4,722,222   4,722                         3,778           8,500
Common Shares issued for debt 4/13/2012 8,250,166   8,250                         6,600           14,850
Common Shares issued for debt 4/17/2012 5,000,000   5,000                         3,000           8,000
Common Shares issued for debt 4/17/2012 6,250,000   6,250                         3,750           10,000
Common Shares issued for debt 4/19/2012 2,724,968   2,725                         1,575           4,300
Common Shares issued for debt 4/18/2012 1,250,000   1,250                         750           2,000
Common Shares issued for debt 4/24/2012 4,005,787   4,006                         2,916           6,922
Common Shares issued for debt 5/01/2012 8,000,000   8,000                         4,000           12,000
Common Shares issued for debt 5/03/2012 7,142,857   7,143                         2,857           10,000
Common Shares issued for debt 5/07/2012 7,692,308   7,692                         2,308           10,000
Common Shares issued for debt 5/09/2012 500,000   500                         0           500
Common Shares issued for debt 6/20/2012 1,590,562   1,591                         6,330           7,921
Common Shares issued for debt 6/20/2012 15,873,016   15,873                         44,127           60,000
Common Shares issued for debt 6/20/2012 1,590,562   1,591                         6,330           7,921
Common Shares issued for debt 6/25/2012 1,808,172   1,808                         4,819           6,627
Common Shares issued for debt 8/09/2012 10,650,777   10,651                         2,602           13,253
Common Shares issued for debt 8/09/2012 5,325,603   5,326                         1,301           6,627
Common Shares issued for interest 1/27/2012 51,672   52                         1,648           1,700
Common Shares issued for interest 4/10/2012 833,333   833                         667           1,500
Common Shares issued for interest 4/18/2012 875,000   875                         525           1,400
Common Shares issued for interest 5/09/2012 1,300,000   1,300                         0           1,300
Cancellation of Common Shares Issued 1/10/2012 (90,000)   (83)                         (86,687)           (86,687)
Restricted Stock Award to employees 4/3/2012 77,000,000   77,000                         (77,000)           0
Restricted Stock Award to consultant 4/3/2012 15,000,000   15,000                         (15,000)           0
Restricted Stock Award compensation                                            
Expense Recognized                               58,491           58,491
Series B Preferred Dividend paid 3/06/2012                     3,201,397 3,201       (3,201)           0
Issuance of Non Voting Convertible                                            
Preferred Shares 3/27/2012                         75,000 75,000               75,000
Recognition of Beneficial Conversion Feature                               32,142           32,142
Non Voting Convertible Preferred Shares                                            
Shares issued pursuant to Contractual Obligations 4/11/2012 1,029,679   1,030                         3,192           4,222
Shares issued pursuant to Contractual Obligations 4/11/2012 1,276,996   1,277                         3,957           5,234
Shares issued pursuant to Contractual Obligations 4/13/2012 1,101,420   1,101                         2,643           3,745
Shares issued pursuant to Contractual Obligations 4/13/2012 1,329,633   1,329                         3,190           4,520
Shares issued pursuant to Contractual Obligations 8/02/2012 1,536,998   1,537                         4,611           6,148
                                             
Cancellation of Restricted Stock Award to Employee (15,000,000)   (15,000)                         6,813           (8,187)
8/6/2012                                            
Net Loss Year ended August 31, 2012                                       (1,885,824)   (1,885,824)
Beneficial Conversion Feauture Deemed Dividend                                       (32,142)   (32,142)
Discontinued Operations                                       (3,739)   (3,739)
Balance August 31 2012 223,492,927   223,493   5,000   5       3,201,397 3,201 75,000 75,000   3,030,642   274,162   (3,664,302)   (57,799)
Common Shares issued for debt 10/22/2012 10,810,811   10,811                                     10,811
Common Shares issued for debt 10/23/2012 10,897,436   10,897                                     10,897
Common Shares issued for debt 10/24/2012 10,833,333   10,833                                     10,833
Common Shares issued for debt 10/25/2012 10,833,333   10,833                                     10,833
Common Shares issued for debt 10/26/2012 10,833,333   10,833                                     10,833
Common Shares issued for debt 11/06/2012 4,642,587   4,643                                     4,643
Common Shares issued for debt 10/09/2012 23,000,000   23,000                                     23,000
Common Shares issued for debt 10/25/2012 31,346,154   31,346                                     31,346
Common Shares issued for debt 11/16/2012 36,261,905   36,262                                     36,262
Common Shares issued for debt 07/08/2012 22,727,273   22,727                         2,273           25,000
Common Shares issued for Interest 11/06/2012 3,035,894   3,036                                     3,036
Common Shares issued for cash 9/4/2012 10,000,000   10,000                         8,655           18,655
Common Shares issued for cash 9/10/2012 10,000,000   10,000                         8,655           18,655
Common Shares issued for cash 9/17/2012 6,802,465   6,802                         5,888           12,690
Common Shares issued for cash 10/02/2012 10,837,849   10,838                         3,462           14,300
Common Shares issued for Nonvoting Converible Preferred                                            
Stock 3/13/2013 3,011,583   3,012                   (7,800) (7,800)   4,788           0
Common Shares issued for Nonvoting Converible Preferred                                            
Stock 5/22/2013 17,928,571   17,929                   (18,825) (18,825)   896           0
Common Shares issued for Nonvoting Converible Preferred                                            
Stock 2/15/2013 30,649,531   30,649                   (23,600) (23,600)               7,049
Common Shhares issued as legal settlement 3/12/2013 41,000,000   41,000                         155,800           196,800
Discount on Convertible Note recognized                               63,000           63,000
Discount on penalty on  Convertible Note recognized                               34,303           34,303
Restricted Stock Award compensation                                            
Expense Recognized                               123,200           123,200
Common Shares issued pursuant to                                            
Contractual Obligations 11/14/2012 26,868,132   26,868                                     26,868
Common Shares issued pursuant to                                            
Contractual Obligations 12/05/2012 6,043,651   6,043                                     6,043
Net Loss Year ended August 31, 2013                                       (1,293,583)   (1,293,583)
Discontinued Operations                                       (34,554)   (34,554)
Balance August 31 2013 561,856,768   561,855   5,000   5       3,201,397 3,201 24,775 24,775   3,441,563   274,162   (4,992,439)   (686,878)
Common Shares Issued for debt 9/4/2013 27,887,324   27,887                                     27,887
Common Shares issued for Debt 9/16/2013 28,000,000   28,000                                     28,000
Common Shares issued for Debt 9/20/2013 20,820,513   20821                                     20,821
Common Shares issued for Nonvoting Convertible  Preferred 9/23/2013 39,325,397   39,325                   (24,775) (24,775)               14,550
Common Shares issued for Debt 9/24/2013 27,948,718   27,949                                     27,949
Common Shares issued for Debt 9/27/2014 27,948,718   27,949                                     27,949
Common Shares issued for Debt 9/30/2013 60,000,000   60,000                                     60,000
Common Shares issued for Debt 10/02/2013 24,848,485   24,848                                     24,848
Common Shares issued for Debt 10/08/2013 27,727,273   27,727                                     27,727
Common Shares issued for Debt 10/09/2013 28,000,000   28,000                                     28,000
Common Shares issued for Debt 10/10/2013 27,777,778   27,778                                     27,778
Common Shares issued for Debt 10/14/2013 60,000,000   60,000                                     60,000
Common Shares issued for Debt 10/15/2013 27,777,778   27,778