UNITED STATES
SECURITY AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 2018
or
[_] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to _________
Commission File Number: 000-21555
StemGen, Inc.
(Exact name of registrant as specified in its charter)
Delaware | 54-1812385 | |
(State or other jurisdiction of Incorporation or organization) | (I.R.S. Employer Identification Number) | |
1 Performance Drive, Suite F Arlington, TX |
77515 | |
(Address of principal executive offices) | (Zip code) |
Registrant’s telephone number, including area code: (832) 954-7569
Indicate by check mark whether the registrant (1) has fled all reports required to be fled 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 fling requirements for the past 90 days. Yes [X] No [_]
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes [X] No [_]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | [_] | Accelerated filer | [_] | |
Non-accelerated filer | [_] | Smaller reporting company | [X] | |
Emerging growth company | [_] |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [_]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [X] No [_]
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of February 10, 2019, there were 53,715,514 shares of common stock issued and outstanding.
TABLE OF CONTENTS
Page | ||
Part I — Financial Information | ||
Item 1. | Financial Statements. | 4 |
Condensed Balance Sheets (Unaudited) | 4 | |
Condensed Statements of Operations (Unaudited) | 5 | |
Condensed Statements of Cash Flows (Unaudited) | 6 | |
Notes to the Unaudited Condensed Financial Statements | 7 | |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations. | 9 |
Item 3. | Quantitative and Qualitative Disclosures about Market Risk. | 11 |
Item 4. | Controls and Procedures. | 11 |
Part II — Other Information | ||
Item 1. | Legal Proceedings. | 12 |
Item 1A. | Risk Factors. | 12 |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds. | 12 |
Item 3. | Defaults upon Senior Securities. | 12 |
Item 4. | Mine Safety Disclosures. | 12 |
Item 5. | Other Information. | 12 |
Item 6. | Exhibits. | 12 |
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
Certain statements in this report contain or may contain forward-looking statements. These statements, identified by words such as “plan”, “anticipate”, “believe”, “estimate”, “should”, “expect” and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. These statements are subject to known and unknown risks, uncertainties and other factors, which may cause actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward - looking statements. These forward-looking statements were based on various factors and were derived utilizing numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to secure suitable financing to continue with our existing business or change our business and conclude a merger, acquisition or combination with a business prospect, economic, political and market conditions and fluctuations, government and industry regulation, interest rate risk, U.S. and global competition, and other factors. Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. Readers should carefully review this report in its entirety, including but not limited to our financial statements and the notes thereto and the risks described in our Annual Report on Form 10-K for the fiscal year ended June 30, 2018. We advise you to carefully review the reports and documents we file from time to time with the Securities and Exchange Commission (the “SEC”), particularly our quarterly reports on Form 10-Q and our current reports on Form 8-K. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.
OTHER PERTINENT INFORMATION
When used in this report, the terms, “we,” the “Company,” “SGNI,” “our,” and “us” refers to StemGen, Inc., a Delaware corporation.
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PART I — FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
STEMGEN, INC.
CONDENSED BALANCE SHEETS
(UNAUDITED)
December 31, 2018 | June 30, 2018 | ||||||
ASSETS | |||||||
CURRENT ASSETS | |||||||
Cash | $ | — | $ | — | |||
Total current assets | — | — | |||||
TOTAL ASSETS | $ | — | $ | — | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | |||||||
CURRENT LIABILITIES | |||||||
Accounts payable and accrued expenses | $ | 151,564 | $ | 151,314 | |||
Advances payable | 36,040 | 18,540 | |||||
Current portion of accrued interest payable | 222,005 | 174,315 | |||||
Current portion of convertible notes payable, net of discount of $2,046 and $3,033, respectively | 562,516 | 560,170 | |||||
Total current liabilities | 972,125 | 904,339 | |||||
TOTAL LIABILITIES | 972,125 | 904,339 | |||||
COMMITMENTS AND CONTINGENCIES | |||||||
STOCKHOLDERS’ EQUITY (DEFICIT) | |||||||
Common stock, $0.001 par value; 20,000,000 shares authorized; 14,083,927 and 14,083,927 shares issued and outstanding at December 31, 2018 and June 30, 2018, respectively |
14,084 | 14,084 | |||||
Series E Preferred stock, $0.000001 stated value; 1,000,000 shares authorized; 1,000,000 and 1,000,000 shares issued and outstanding at December 31, 2018 and June 30, 2018, respectively |
1 | 1 | |||||
Additional paid-in capital | 1,061,842 | 1,061,842 | |||||
Accumulated deficit | (2,048,052 | ) | (1,980,266 | ) | |||
Total stockholders’ deficit | (972,125 | ) | (904,339 | ) | |||
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ | — | $ | — |
The accompanying notes are an integral part of these unaudited condensed financial statements.
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STEMGEN, INC.
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three months ended December 31, |
Six months ended December 31, |
||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||
OPERATING EXPENSES | |||||||||||||
General and administrative expenses | $ | 8,000 | $ | 1,750 | $ | 17,750 | $ | 3,500 | |||||
LOSS FROM OPERATIONS | (8,000 | ) | (1,750 | ) | (17,750 | ) | (3,500 | ) | |||||
OTHER EXPENSE | |||||||||||||
Interest expense | (29,714 | ) | (23,211 | ) | (50,036 | ) | (46,422 | ) | |||||
NET LOSS | (37,714 | ) | (24,961 | ) | (67,786 | ) | (49,922 | ) | |||||
NET LOSS PER COMMON SHARE – Basic and diluted | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | (0.00 | ) | |||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING – Basic and diluted | 14,083,927 | 14,083,927 | 14,083,927 | 14,083,927 |
The accompanying notes are an integral part of these unaudited condensed financial statements.
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STEMGEN, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Six months ended December 31, |
|||||||
2018 | 2017 | ||||||
CASH FLOW FROM OPERATING ACTIVITIES: | |||||||
Net loss | $ | (67,786 | ) | $ | (49,922 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Amortization of discount on convertible note payable | 2,346 | 4,126 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts payable and accrued liabilities | 250 | 3,500 | |||||
Advances | 17,500 | — | |||||
Accrued interest payable | 47,690 | 42,296 | |||||
NET CASH USED IN OPERATING ACTIVITIES | — | — | |||||
NET INCREASE (DECREASE) IN CASH | — | — | |||||
CASH, at the beginning of the period | — | — | |||||
CASH, at the end of the period | $ | — | $ | — | |||
Supplemental Disclosures of Cash Flow Information: | |||||||
Cash paid during the period for: | |||||||
Interest | $ | — | $ | — | |||
Taxes | $ | — | $ | — |
The accompanying notes are an integral part of these unaudited condensed financial statements.
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STEMGEN, INC.
NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS
DECEMBER 31, 2018
Note 1. General Organization and Business
StemGen, Inc (the “Company”) was incorporated in Delaware in 1992, and in 1996 received all remaining assets of Infotechnology, Inc. (“Infotech”), a Delaware company, following the completion of Infotech’s Chapter 11 Bankruptcy reorganization, in accordance with an Assignment and Assumption Agreement, dated October 11, 1996, and effective as of June 21, 1996. As a result of a series of transactions during the 1980’s, Infotech, then principally engaged in the information and communications business, acquired equity interests in Comtex News Network, Inc. (“Comtex”) and Analex Corporation (“Analex”), formerly known as Hadron, Inc. Our business was the maintenance of our equity interest in and note receivable from Comtex and equity interest in Analex.
On September 25, 2006, we exchanged the equity investment in Comtex common stock and the Note Receivable from Comtex of $856,954, for 55,209 shares of the StemGen Series A Preferred stock. We no longer have an equity interest in either the common stock of Comtex or the Note from Comtex.
During October 2006, we sold the remaining 21,000 shares of common stock of publicly held Analex, a defense contractor specializing in systems engineering and developing innovative technical intelligence solutions in support of U.S. national security. We no longer have an equity interest in Analex.
On December 24, 2012, the Corporation received a nonrefundable deposit of $32,500 under a Letter of Intent (“LOI”) which it entered into on December 11, 2012 with StemGen Inc. a Nevada corporation. Effective February 5, 2013, the Company amended its Certificate of Incorporation. As a result of the Amendment, the Company’s corporate name changed from Amasys Corporation to StemGen, Inc. and a reverse stock split was effectuated where all the outstanding shares of the Company’s common stock were exchanged at a ratio of one for eighty. The LOI was terminated on August 6, 2013.
Since we redeemed and converted all of our outstanding Series A Preferred Stock at the end of September 2006, starting October 1, 2006 through December 31, 2018, we had not conducted any business operations.
On May 15, 2015, we purchased 100% of the membership interests in Global Visionary Investments LLC, a business advisory services company, (“Global Visionary”) as a means to facilitate the process of driving possible target leads and vetting potential investments in those targets. This transaction was rescinded in May 2018.
We have been engaged in a search for the acquisition of an operating business or a company with a well developed business plan to participate in an emerging industry.
Our search was successful when we entered into a letter of intent to acquire 100% of the equity interest in D3esports Corp. in exchange for our capital stock that represents a minority interest in us. The letter of intent provides for the name of our corporation to D3sports and continuing its existence in Wyoming. The letter also contains the customary provisions including due diligence, a definitive agreement, representations, warranties and regulatory compliance.
D3esports is a newly organized Wyoming corporation that intends to offer a competition platform in eSports for gamers and sport enthusiasts to compete virtually to win a real experience
Note 2. Going Concern
The accompanying unaudited condensed financial statements have been prepared assuming that the Company will continue as a going concern. For the six months ended December 31, 2018, the Company had a net loss of $67,786. As of December 31, 2018, the Company had negative working capital of $972,125. Management does not anticipate having positive cash flow from operations in the near future.
These factors raise a substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.
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The Company does not have the resources at this time to repay its credit and debt obligations, make any payments in the form of dividends to its shareholders or fully implement its business plan. Without additional capital, the Company will not be able to remain in business.
Management has plans to address the Company’s financial situation as follows:
In the near term, management plans to continue to focus on raising the funds necessary to implement the Company’s business plan. Management will continue to seek out debt financing to obtain the capital required to meet the Company’s financial obligations. There is no assurance, however, that lenders will continue to advance capital to the Company or that the new business operations will be profitable. The possibility of failure in obtaining additional funding and the potential inability to achieve profitability raise doubts about the Company’s ability to continue as a going concern.
In the long term, management believes that the Company’s projects and initiatives will be successful and will provide cash flow to the Company, which will be used to finance the Company’s future growth. However, there can be no assurances that the Company’s planned activities will be successful, or that the Company will ultimately attain profitability. The Company’s long-term viability depends on its ability to obtain adequate sources of debt or equity funding to meet current commitments and fund the continuation of its business operations, and the ability of the Company to achieve adequate profitability and cash flows from operations to sustain its operations.
Note 3. Summary of Significant Accounting Policies
Interim Financial Statements
The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, the consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and such adjustments are of a normal recurring nature. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements for the fiscal year ended June 30, 2018 and notes thereto and other pertinent information contained in our Form 10-K the Company has filed with the Securities and Exchange Commission (the “SEC”).
The results of operations for the six month period ended December 31, 2018 are not necessarily indicative of the results to be expected for the full fiscal year ending June 30, 2019.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Earnings (Loss) per Common Share
The Company computes basic and diluted earnings per common share amounts in accordance with ASC Topic 260, Earnings per Share. The basic earnings (loss) per common share are calculated by dividing the Company’s net income available to common shareholders by the weighted average number of common shares outstanding during the year. The diluted earnings (loss) per common share are calculated by dividing the Company’s net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted as of the first of the year for any potentially dilutive debt or equity. There are no dilutive shares outstanding for any periods reported.
Recently Issued Accounting Pronouncements
We have reviewed the FASB issued Accounting Standards Update (“ASU”) accounting pronouncements and interpretations thereof that have effectiveness dates during the periods reported and in future periods. The Company has carefully considered the new pronouncements that alter previous generally accepted accounting principles and does not believe that any new or modified principles will have a material impact on the corporation’s reported financial position or operations in the near term. The applicability of any standard is subject to the formal review of our financial management and certain standards are under consideration.
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Note 4. Advances from Third Parties
During the six months ended December 31, 2018, the Company received advances of $17,500 for working capital. These advances are non-interest bearing and payable on demand. As of December 31, 2018 and June 30, 2018, advances in the amount of $36,040 and $18,540, respectively, are included in current liabilities on the balance sheets.
Note 5. Commitments and contingencies
From time to time, we may be involved in litigation in the ordinary course of business. However, we are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. To our knowledge, there is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of our executive officers or any of our subsidiaries, threatened against or affecting our Company, our common stock, any of our subsidiaries or any of our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.
Note 6. Subsequent Events.
On January 29, 2019 (the “Closing Date”), we completed and closed the acquisition (the “Acquisition”) under an Agreement and Plan of Reorganization (the “Reorganization Agreement”), entered into by and among by and among (i) StemGen, Inc.(“StemGen”); (ii) D3esports, Inc., a Wyoming corporation ( “D3esports”); (ii) and the shareholders of D3esports (“Sellers”) pursuant to which D3esports became a wholly owned subsidiary of ours. Pursuant to the Reorganization Agreement, we acquired from the Sellers all of the issued and outstanding equity interests of D3esports in exchange for 39,631,587 shares of our common stock, par value $0.001 per share and 7,000,000 shares of Preferred Stock, par value $0.001 per share. As a result of the Acquisition, the Sellers, as the former shareholders of D3esports, became the controlling shareholders of the Company. The Acquisition was accounted for as a reverse merger notwithstanding it is legally a reverse acquisition.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW
StemGen, Inc (the “Company”) was incorporated in Delaware in 1992, and in 1996 received all remaining assets of Infotechnology, Inc. (“Infotech”), a Delaware company following the completion of Infotech’s Chapter 11 Bankruptcy reorganization, in accordance with an Assignment and Assumption Agreement, dated October 11, 1996, and effective as of June 21, 1996.
We have been engaged in a search for the acquisition of an operating business or a company with a well developed business plan to participate in an emerging industry.
Our search was successful when we entered into a letter of intent to acquire 100% of the equity interest in D3esports Corp. in exchange for our capital stock that represents a minority interest in us. The letter of intent provides for the name of our corporation to D3sports and continuing its existence in Wyoming. The letter also contains the customary provisions including due diligence, a definitive agreement, representations, warranties and regulatory compliance.
D3esports is a newly organized Wyoming corporation that intends to offer a competition platform in eSports for gamers and sport enthusiasts to compete virtually to win a real experience.
D3esports intends to gain year-round visibility by using mainline events to host ongoing virtual racing competitions with the top driver(s) at the end of the season earning the opportunity to compete against professional drivers and a chance to drive a real race car.
On January 29, 2019 (the “Closing Date”), we completed and closed the acquisition (the “Acquisition”) under an Agreement and Plan of Reorganization (the “Reorganization Agreement”), entered into by and among by and among (i) StemGen, Inc.(“StemGen”); (ii) D3esports, Inc., a Wyoming corporation ( “D3esports”); (ii) and the shareholders of D3esports (“Sellers”) pursuant to which D3esports became a wholly owned subsidiary of ours. Pursuant to the Reorganization Agreement, we acquired from the Sellers all of the issued and outstanding equity interests of D3esports in exchange for 39,631,587 shares of our common stock, par value $0.001 per share and 7,000,000 shares of Preferred Stock, par value $0.001 per share. As a result of the Acquisition, the Sellers, as the former shareholders of D3esports, became the controlling shareholders of the Company. The Acquisition was accounted for as a reverse merger notwithstanding it is legally a reverse acquisition.
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Critical Accounting Policies
We prepare our consolidated financial statements in conformity with GAAP, which requires management to make certain estimates and apply judgments. We base our estimates and judgments on historical experience, current trends, and other factors that management believes to be important at the time the condensed consolidated financial statements are prepared. On a regular basis, we review our accounting policies and how they are applied and disclosed in our condensed consolidated financial statements.
While we believe that the historical experience, current trends and other factors considered support the preparation of our condensed consolidated financial statements in conformity with GAAP, actual results could differ from our estimates and such differences could be material.
For a full description of our critical accounting policies, please refer to Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report for the year ended June 30, 2018 on Form 10-K.
Results of Operations
Three months ended December 31, 2018 compared to the three months ended December 31, 2017.
General and Administrative Expenses
We recognized general and administrative expenses in the amount of $8,000 and $1,750 for the three months ended December 31, 2018 and 2017, respectively. The increase was due to accounting fees incurred for filings during the three months ended December 31, 2018.
Interest Expense
Interest expense increased from $23,211 for the three months ended December 31, 2017 to $29,714 for the three months ended December 31, 2018 due to an increase in interest rate on notes in default net of a decrease due to the cancellation of a note payable in May 2018. Interest expense for the three months ended December 31, 2018 included amortization of discount on convertible notes payable in the amount of $671, compared to $2,063 in the prior year.
Net Loss
We incurred a net loss of $37,714 for the three months ended December 31, 2018 as compared to $24,961 for the comparable period of 2017. The increase in the net loss was the result of the increased professional fees and increased interest.
Six months ended December 31, 2018 compared to the six months ended December 31, 2017.
General and Administrative Expenses
We recognized general and administrative expenses in the amount of $17,750 and $3,500 for the six months ended December 31, 2018 and 2017, respectively. The increase was due to accounting fees incurred for filings during the six month period ended December 31, 2018.
Interest Expense
Interest expense increased from $46,422 for the six months ended December 31, 2017 to $50,036 for the six months ended December 31, 2018 due to an increase in interest rate on notes in default net of a decrease due to the cancellation of a note payable in May 2018. Interest expense for the six months ended December 31, 2018 included amortization of discount on convertible notes payable in the amount of $2,345, compared to $4,126 in the prior year.
Net Loss
We incurred a net loss of $67,786 for the six months ended December 31, 2018 as compared to $49,922 for the comparable period of 2017.
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Liquidity and Capital Resources
At December 31, 2018, we had no cash on hand. The company has negative working capital of $972,125. We do not expect to achieve positive cash flow from operating activities in the near future. We will require additional cash in order to implement our business plan. There is no guarantee that we will be able to obtain funds when we need them or that funds will be available on terms that are acceptable to the Company. We have no material commitments for capital expenditures as of December 31, 2018.
Additional Financing
Additional financing is required to continue operations. Although actively searching for available capital, the Company does not have any current arrangements for additional outside sources of financing and cannot provide any assurance that such financing will be available.
Off Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Not applicable to a smaller reporting company.
Item 4. Controls and ProceduresManagement’s Report on Internal Control over Financial Reporting
We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of December 31, 2018. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of December 31, 2018, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed by us under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
1. | As of December 31, 2018, we did not maintain effective controls over the control environment. Specifically, we have not developed and effectively communicated to our employees our accounting policies and procedures. This has resulted in inconsistent practices. Further, the Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness. | |
2. | As of December 31, 2018, we did not maintain effective controls over financial statement disclosure. Specifically, controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Accordingly, management has determined that this control deficiency constitutes a material weakness. |
Our management, including our principal executive officer and principal financial officer, who is the same person, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.
Change in Internal Controls Over Financial Reporting
There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.
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PART II — OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We know of no material, active or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceedings or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder are an adverse party or has a material interest adverse to us.
ITEM 1A. RISK FACTORS
Not applicable to a smaller reporting company.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
There were no sales of unregistered equity securities during the three months ended December 31, 2018.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
The Company has not defaulted upon senior securities.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable to the Company.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS
3.1 | Restated Certificate of Incorporation of StemGen, Inc. (1) | |
3.2 | Bylaws of StemGen, Inc. (1) | |
31.1 | Rule 13(a)-14(a)/15(d)-14(a) Certification of principal executive officer and principal financial and account officer (2) | |
32.1 | Section 1350 Certification of principal executive officer and principal financial accounting officer (2) | |
101 | XBRL Interactive Data files (3),(4) |
__________
(1) | Incorporated by reference to the Company’s Form S-1 filed on March 17, 2015. |
(2) | Filed or furnished herewith. |
(3) | To be submitted by amendment. |
(4) | In accordance with Regulation S-T, the Interactive Data Files in Exhibit 101 to the Quarterly Report on Form 10-Q shall be deemed “furnished” and not “filed.” |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
StemGen, Inc. | |||
Date: February 19, 2019 | By: | /s/ Simon Dawson | |
Simon Dawson | |||
CEO and Chairman of the Board |
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Exhibit 31.1
RULE 13A-14(A)/15D-14(A) CERTIFICATION
I, Simon Dawson, certify that:
1. I have reviewed this quarterly report on Form 10-Q for the period ended December 31, 2018 of StemGen, Inc.
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15-d-15(f)) for the registrant and have:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: February 19, 2019 | BY: /s/ Simon Dawson |
| Simon Dawson |
| CEO and Chairman of the Board |
Exhibit 32.1
SECTION 1350 CERTIFICATION
In connection with the quarterly report of StemGen, Inc. (the “Company”) on Form 10-Q for the period ended December 31, 2018 as filed with the Securities and Exchange Commission (the “Report”), I, Simon Dawson, President of the Company, certify, pursuant to 18 U.S.C. SS. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
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2. | The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company. |
Date: February 19, 2019 | BY: /s/ Simon Dawson |
| Simon Dawson |
| CEO and Chairman of the Board |
A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.