May 2013

May 2013

About The Company

International patents have been granted on a platform implant technology that addresses three markets:

The global dental implants market is forecasted to grow at 6% (CAGR) from $3.2 billion in 2010 to $4.2 billion in 2015 (Sandler Research, Nov., 2010).

The Global Dental Implants MarketThe Global Orthopaedic Implant Market

Veterinary Implantology

Value Proposition – Dental Implant

SIT Implant Current Implant

• Uses existing comparable metals• Less prone to failure (double

stem)• Lower Cost• No damage to bone (no cutting

or crushing)• Angled rings simplify insertion

and fixation• Superior in resisting torque

(turning)• Removes less tissue • Easily Installed / single

precision placement• Enhanced opportunity for

dentists (GP’s)

• Prone to failure (falling out)

• Rotates due to single post• High costs of screw

implants• Complex process for

dentists (GP’s)• Lengthy patient waiting

time

(Double Stem design) (Single post

design)

Market Needs and Assessment

- Only screw-less implant - Professionals concur quick

adaptability rate - Greater profit margin for

practitioners and manufacturers / distributors

- Improved patient outcomes and recovery

- Savings in procedure costs and time

- Game-changing lead product

- Aging population boosting market

- Rising awareness for oral health and improved dental treatments

- Growth rate of 6-20% globally (Sandler report)

- Rising edentulous population worldwide

- Patents issued in six countries - Short time to market (minimal

clinical trials) - Certified Health Canada

manufacturer ) in place with metal specifications

- Extension / replacement of current product line for Manufacturers and Distributors (Big Four hold > 60% of market) or new

- Bone implants patents can be used for a family of products, procedures, and processes for the Orthopaedic and Veterinary markets

- Tooth restoration market under-penetrated globally

- Increased practitioner usage = revenues

Competitive Advantage Growth Market

Limited Entry Barriers

Market Expansion

Funding Requirements and Uses

Uses of Funds *

Research & Development

Engineering (Prototype)

Clinical (Trials & Strategy)

Intellectual Property

Regulatory

Salaries & Benefits **

General & Administration

Consulting

Fees & CAPEX

TOTAL

• Funding to Q4 – 2015, all other costs offset by cash flows from future revenues** Consists of 5 personnel at average $132K per annum (base)

Funding Amount:

$3.77 million total equity funding sought

Ideally in tranches of $500K to $1.0M from each investor to coincide with cash flow timing.

Partial funding from warrants exercised Residual funding by non-dilutive

government grants

Means: Preferred Shares (convertible) with

common share purchase warrants @ $10.00 per share

Warrants – 2 common shares for each Preferred share @ $7.50 per share

Warrants are detachable and transferrable Bonus Shares – 1 common share for each

Preferred Bonus Shares – 1 common share for each

warrant exercised and common share purchased

Critical Path

Financing

Regulatory Pre-Submission / Meetings

Clinical Trials

Regulatory Submissions / Approval

Licensing *

Q3-Q4 2012 | Q4 2012–Q1 2013 | Q1 2013-Q2 2014 | Q1 2014-Q1 2015 | Q4 2014 CanadaQ1 2015 FDA

* Licensing discussions begin Q1 2013

Financial Highlights

2014 2015 2016 2017 2018Revenues 525 4,169 7,653

Licensing Revenues 28,000 12,000

EBITDA (586) 3,027 6,441

Net Income 436 259 16,005 8,448 3,484

Cash Flow 633 755 5,000 5,000 5,000

NPV (after-tax) of $47.7M (Independent third party valuation)

Projected Value per share of $40.78 (June 2017)

Markets & Revenues

2016

2017

2018

- 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000

Canada USA Europe ROW

Conservative projections based on .08% of global market volume of $4.2 billion (2015)

Projected ROI & Exit Strategy

(000’s)Preferre

dWarrant

s* Total

Investment Dollars $500 $375 $875

Year 3 – Dividends ** 763 763 1,526

Year 4 - Dividends 536 536 1,072

Year 5 - Dividends 209 209 418

Year 5 – Capital Appreciation 4,076 4,076 8,156

TOTAL 5,666 5,586 11,252

IRR% 74.7% 83.71% 78.8%

Multiple 11.3X 14.9X 12.9X

Payback (in years) 2.75 2.75 2.75

% ownership 6.6% 6.6% 13.2%

Return on Investment

NPV of $47.7M (independent valuation)

Projected Value per share of $40.78 (June 2017)

Possible IPO in five years

Possible divesting of whole company or just dental asset as development continues on the orthopaedic and veterinary applications

* Assumes 50% of warrant shares exercised** Anticipated distribution of Licensing revenues

Professional TeamManagement Team

Christopher Ostrovski, President & CEO

Dr. Michael Lococo, Director Innovation

Doug McNaughton, CFO Martin Lococo, Director Marketing

& Sales Diane Kalina, Director Licensing

Corporate Consultants Dr. Scott Proctor - PG Business

Growth Advisors and Certified Public Accounts, LLC

Wendy Hill - GAP Strategies Daryl Wisdahl – EMERGO

Group Diane Kalina – BioCatalyst

Yorkton Ltd. Bonnie Loubert – Loubert Brown

Consulting

Scientific Advisors Dr. Emmanuel Rajczak, DDS Dr. Greg Wohl, Ph.D. – Biomedical

Engineering, McMaster University Dr. Karl Stobbe, M.D., Regional

Assistant Dean, Michael G. DeGroote, School of Medicine, McMaster University

Dr. Robert Josefchak – Orthopaedic Surgeon, McMaster University

Corporate Advisors Gowling, Henderson, LeFluer

(Patents) Gardiner-Roberts LLP

(Corporate Attorneys) Deloitte Touche – (Auditors) Randy Gillen - Licensing

Contact information

• Christopher Ostrovski, President & CEO [email protected] Tel. 416 – 626 – 1835 ( Canada )• Douglas McNaughton, CFO [email protected] Tel. 289 -213-8886 ( Canada )• www.stemmedimplant.com