SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
Report (Date of earliest event reported): March 11, 2010
NEOSTEM,
INC.
(Exact
Name of Registrant as Specified in Charter)
|
Delaware
(State
or Other Jurisdiction
of
Incorporation)
|
0-10909
(Commission
File
Number)
|
22-2343568
(IRS
Employer
Identification
No.)
|
420 Lexington Avenue, Suite
450, New York, New York 10170
(Address
of Principal Executive Offices)(Zip Code)
(212)
584-4180
Registrant's
Telephone Number
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
|
o
|
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|
|
o
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
|
o
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
|
|
o
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
Item
5.02. Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On March
11, 2010, the Board of Directors of the Company appointed Shi Mingsheng as a
director of the Company. Mr. Shi will not serve on any of the committees of the
Board of Directors of the Company.
Mr. Shi,
age 58, has been serving as Chairman of the Board of Directors of Suzhou Erye
Pharmaceuticals Company Ltd., an entity of which the Company owns approximately
51% of the outstanding equity interests ("Erye"), since 2003. Mr. Shi
also currently serves as the Chairman of Suzhou Erye Economy and Trading Co.
Ltd., an entity which owns the remaining 49% of the outstanding interests in
Erye ("EET"). Prior to these affiliations, Mr. Shi served for five years as the
Assistant Director of Suzhou No. 4 Pharmaceutical Limited Company, and seven
years as the Deputy Director of Suzhou No. 4 Pharmaceutical Limited Company, and
five years as the Factory Director of Suzhou No. 2 Pharmaceutical Limited
Company, the predecessor company of Erye. Mr. Shi has a bachelor
degree in Economics & Management from The Party School of the Central
Committee of the Communist Party of China. Mr. Shi holds a
professional title of Senior Economist.
As
previously disclosed in a Current Report on Form 8-K filed with the SEC on
November 4, 2009, pursuant to the terms of the Merger Agreement (the "Merger
Agreement"), dated as of November 2, 2008, among the Company, China
Biopharmaceuticals Holdings, Inc. ("CBH"), China Biopharmaceuticals Corp., a
wholly-owned subsidiary of CBH ("CBC"), and CBH Acquisition LLC, a wholly-owned
subsidiary of the Company ("Merger Sub"), Mr. Shi was to become a member of the
Company's Board of Directors upon receipt of all applicable People's Republic of
China ("PRC") approvals in connection with the merger of CBH with and into
Merger Sub contemplated by the Merger Agreement (the "Merger"), subject to
appropriate action by the Board of Directors of the Company. The
Merger was completed on October 30, 2009 and all the applicable PRC approvals in
connection with the Merger were obtained as of December 28,
2009. Accordingly, on March 11, 2010, the Board of Directors of the
Company appointed Mr. Shi as a director of the Company.
In a
private placement of units by the Company in November 2008, Fullbright Finance
Limited ("Fullbright"), a wholly-owned subsidiary of EET, purchased 400,000
units for an aggregate consideration of $500,000. The per unit price
was $1.25 and each unit comprised of one share of Common Stock and one
redeemable five-year warrant to purchase one share of Common Stock at a purchase
price of $1.75 per share. In connection with Fullbright’s purchase of
the units, EET borrowed $500,000 from RimAsia Capital Partners, L.P., a
beneficial holder of more than 5% of the outstanding shares of Common Stock, and
the units acquired by Fullbright were pledged to RimAsia Capital Partners, L.P
as collateral therefor. Further, in a private placement by the
Company in June and July 2009, Fullbright acquired, for an aggregate purchase
price of $800,000, 64,000 shares of the Company's Convertible Redeemable Series
D Preferred Stock, together with warrants to purchase 640,000 shares of Common
Stock. The Convertible Redeemable Series D Preferred Stock
automatically converted into 640,000 shares of Common Stock in connection with
the Merger. Fullbright currently holds approximately 10.2% of the
outstanding shares of Common Stock. Fullbright, EET, Mr. Shi, Madam
Zhang and Ding Weihua, a former director of CBH, have shared power to vote and
dispose of the shares of Common Stock held by Fullbright and, as a result, may
be deemed to beneficially own the shares of Common Stock held by
Fullbright. Mr. Shi holds approximately 66% of the outstanding equity
interests in EET and Madam Zhang is the General Manager of Erye and holds
approximately 10% of the outstanding equity interests in EET.
In
November 2009, an aggregate of 125,000 shares of Common Stock were issued
to Fullbright, as the
designee of EET and Madam Zhang for assistance in effecting the
Merger. In addition, on December 28, 2009, an aggregate of 203,338
shares of Common Stock were issued to Fullbright as the designee of Mr. Shi and
Madam Zhang following the receipt of all applicable PRC approvals in connection
with the Merger. Further, on December 28, 2009, Mr. Shi and Madam
Zhang received an aggregate of 350,000 shares of Common Stock (175,000 shares
each) as bonuses in connection with the transactions contemplated by the Merger
after receipt of the PRC approvals and the closing of the Merger.
2
Immediately
prior to the closing of the Merger, in order to accelerate satisfaction of
certain CBH obligations to EET, CBH and EET caused Erye to split-off its real
estate assets into a new entity, with the end result that, subject to PRC
approvals, (a) Erye is bound to transfer the land and building for its principal
manufacturing facility to EET or its affiliate for a nominal sum to be agreed
upon by the parties, and (b) EET or its affiliate is bound to lease such
principal manufacturing facility back to Erye at a nominal fee for a term
through the construction and validation period of Erye’s new manufacturing
facility and until such date as Erye’s new facility is completed and fully
operational, such that Erye is assured that there is no interruption of its
operations by reason of such transfers and agreements.
Pursuant
to a joint venture agreement between Merger Sub and EET (the "Joint Venture
Agreement"), which became effective upon receipt of all requisite PRC approvals
on December 28, 2009, during the three-year period commencing on the first day
of the first fiscal quarter after the Joint Venture Agreement became effective,
45% of the net profit after tax will be provided to Erye, rather than
distributed to the Company, to fund construction of Erye’s new plant, thereby
benefitting EET.
3
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, NeoStem has duly
caused this Report to be signed on its behalf by the undersigned hereunto duly
authorized.
|
NEOSTEM,
INC.
|
|||
|
By:
|
/s/
Catherine M. Vaczy
|
||
|
Name:
Catherine M. Vaczy
|
|||
|
Title:
Vice President and General Counsel
|
|||
Date: March 17,
2010
4