Yes, Crocodiles can jump. In the water they can jump a bit over half their body length. Biostem U.S. Corp. (Pinksheets: HAIR.PK) stock did even better gaining 89.36% to close at $0.2651 on volume of 692,810, 50X the 3 month average. Why the crocodile reference? Simply because 1,974,784 of Biostem U.S. Corp.’s HAIR stock is owned by current Officer and Senior V.P. of Crocs Inc. Nasdaq: CROX), Scott Crutchfield. The Hair Club for men made millions for Cy Sperling since baldness has no cure. Could HAIR.PK do the same for investors?
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The awareness on Biostem U.S. was first broke by First Microcap Report. HAIR stock should be watched closely as the company appears ready to undergo a massive publicity campaign similar to the one RepliCel Life Sciences (OTC: REPCF) did in order to inform the balding community of this stem cell procedure available through Biostem. There is expected to be a celebrity patient/spokesman and as much as $2 million budgeted for publicity.
The company intends to instruct and license physicians to provide Regenerative Cellular Therapy treatments to assist in the body’s natural approach to healing tendons, ligaments, joints and muscle injuries by using the patient’s own stem cells. I have 7 candidates listed for them immediately, all of whom were on my Fantasy Baseball team at the beginning of the season: Brian Wilson, Joakim Soria, Cory Luebke, Neftali Feliz, Tim Stauffer, Vance Worley and Mariano Rivera.
Much of the share float appears to be locked by SEC Rule 144 so there doesn’t seem to be much stock available. There was 85,056,952 outstanding as of November 30, 2011 with 200,000,000 authorized. Yesterday, the Company announced they entered into a stock purchase agreement with Elco Securities Ltd., pursuant to which Biostem U.S. agreed to sell to Elco, and Elco agreed to purchase from Biostem U.S., 20 million shares of HAIR common stock for an aggregate purchase price of $5 million, $0.25 per share, which amount is payable in 6 equal monthly installments. The stock purchase agreement provides that the closing of the forgoing transaction will occur on July 1, 2012 or at such other time as the parties may agree.
|Market Value1||$38,260,720||a/o May 23, 2012|
|Shares Outstanding||273,290,856||a/o May 01, 2012|
|Authorized Shares||Not Available|
About Biostem U.S.
It’s been a while, since November 30 2011, since Biostem U.S. filed any financials. But what we do know is that The Company was incorporated as Equinox International, Inc. on November 5, 2008 in the state of Nevada. Originally, the Company planned to commence operations in the oil and gas exploration and production industry in North America. However, with the goal of becoming a marketing and licensing company that would market certain regenerative medical procedures and products and license its brand and technologies to a network of medical providers (who would, in turn, provide medical procedures to their patients based on the Company’s technologies), the Company acquired from Biostem US LLC, a privately held Florida limited liability company, certain assets related to hair transplant procedures.
Specifically, the Acquired Assets consists of a hair transplant process and protocols known as the “Biostem Method” that involves the injection of autologous platelet rich plasma containing stem cells from the patient to the scalp of the patient in combination with an oral nutriceutical and the concomitant use of low-level laser therapy, which combination the Company believes helps support the healing of transplanted area and increases the success of the hair transplant surgery.
Prior to the Asset Transfer, Biostem US LLC acquired the Biostem Method from Dr. Markou, who owns and operates a hair restoration medical clinic in Clearwater, FL, which he operates as Markou Medical, P.A. Prior to the Asset Transfer, Dr. Markou provided many procedures for his patients at his clinic, including, but not limited to, hair transplants based upon the Biostem Method. Since the Asset Transfer, Dr. Markou continues to provide many procedures at his clinic, including, but not limited to, hair transplants based upon the Biostem Method.
However, since the Asset Transfer, any hair transplants that he conducts based upon the Biostem Method are pursuant to a medical affiliate arrangement between Dr. Markou and the Company, pursuant to which the Company grants Dr. Markou the right to use the processes and protocols related to the Biostem Method, as well as the Biostem tradename, and markets the hair transplant procedure on Dr. Markou’s behalf, and, in consideration thereof, Dr. Markou pays to the Company licensing and marketing fees ranging from $400 to $500 per hair transplant depending on the number of grafts in such transplant.
Pursuant to the medical affiliate agreement, all hair transplants and related procedures are to be provided by Dr. Markou (or other medical professionals under his supervisions), through his clinic and under his supervision, and to his patients. The agreement does not prevent Dr. Markou from providing other procedures at his clinic, and Dr. Markou does not pay the Company any licensing or marketing fees for these other procedures. The Company does not provide hair transplants or practice medicine or manage Dr. Markou’s practice, but instead licenses the Biostem Method and name to Dr. Markou and provides marketing (including radio, television and internet campaigns) relating the Biostem Method to help drive patients to Dr. Markou’s practice.
Bottom Line: Having Scott Crutchfiled, Senior V.P. of Crocs Inc. (see here) on your list of 3 corporate insiders is pretty big, but is it big enough to make HAIR stock jump? The penny stock of Biostem has an agreement which gives HAIR.PK shares a value of $0.40, 0.135 higher than where they closed in the last trading session. Can Biostem U.S. and HAIR stock price have the same success CROX did over the last 4 years? Seems risky but I’ll bite.
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