REPLICEL LIFE SCIENCES INC. (Form: 20-F, Received: 04/26/2012 16:50:20)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 20-F

(Mark One)

[ ] REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2011

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________________ to ____________________

[ ] SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report:

Commission file number 000-50112

REPLICEL LIFE SCIENCES INC.
(formerly Newcastle Resources Ltd.)
(Exact name of Registrant as specified in its charter)

Not Applicable
(Translation of Registrant’s name into English)

British Columbia, Canada
(Jurisdiction of incorporation or organization)

Suite 1225 – 888 Dunsmuir Street
Vancouver, British Columbia, Canada V6K 3C4
(Address of principal executive offices)

David Hall, President & CEO,
Telephone: (604) 248-8730
Suite 1225 – 888 Dunsmuir Street
Vancouver, British Columbia, Canada V6K 3C4
Facsimile: (604) 248-8690
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of each class	Name of each exchange on which registered
Not Applicable	Not Applicable

Securities registered or to be registered pursuant to Section 12(g) of the Act.

Common Shares Without Par Value
(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.

Not Applicable
(Title of Class)

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report:
43,150,008 common shares as of December 31, 2011

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
[ ] YES [X] NO

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
[ ] YES [X] NO

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.
[X] YES [ ] NO

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).
(Not applicable to the registrant at this time) [ ] YES [ ] NO

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ]

Accelerated filer [ ]

Non-accelerated filer [X]

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP [ ]	International Financial Reporting Standards as issued	Other [ ]
	by the International Accounting Standards Board [X]

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.
[ ] Item 17 [ ] Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
[ ] YES [X] NO

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
[ ] YES [ ] NO

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GENERAL INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

This annual report on Form 20-F contains forward-looking statements. Forward-looking statements are projections in respect of future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “intend”, “expect”, “plan”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, or “continue”, or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors” commencing on page 6, which may cause our or our industry’s actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements. These risks and uncertainties include:

negative results from our clinical trials, including that our hair cell replication technology may not work as planned or may not be effective at causing the re-growth of hair follicles or the rejuvenation of damaged, miniaturized follicles;
the effects of government regulation on our business;
the viability and marketability of our hair cell replication technology;
our failure to successfully implement our marketing plan;
the development of superior technology by our competitors;
the failure of consumers and the medical community to accept our technology as safe and effective;
risks associated with our ability to obtain and protect rights to our intellectual property;
risks and uncertainties associated with our ability to raise additional capital; and
other factors beyond our control.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance. Further, any forward-looking statement speaks only as of the date on which such statement is made, and, except as required by applicable law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all of such factors and to assess in advance the impact of such factors 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 statement.

As used in this annual report, the terms “we”, “us”, “our”, and “RepliCel” mean RepliCel Life Sciences Inc., a British Columbia, Canada, corporation, and our wholly-owned subsidiary, TrichoScience Innovations Inc., as applicable.

FIRST TIME APPLICATION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS

Effective from January 1, 2011, we adopted International Financial Reporting Standards (“ IFRS ”), as issued by the International Accounting Standards Board. Unless otherwise stated, all information presented herein has been prepared in accordance with IFRS and all prior period amounts have been reclassified to conform with IFRS. These are our first consolidated financial statements prepared in accordance with IFRSs and IFRS 1 First-time Adoption of International Financial Reporting Standards has been applied. Please note that our prior annual financial statements were prepared in accordance with Canadian generally accepted accounting principles, which may not be comparable to IFRS. Please refer to Note 16 of our annual financial statements included herein for a discussion on the impact of our transition from Canadian generally accepted accounting principles to IFRS.

CURRENCY

Unless otherwise stated, “$”, when used in this Form 20-F, refers to Canadian dollars.

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TABLE OF CONTENTS

PART I			5
	ITEM 1.	Identity of Directors, Senior Management and Advisers	5
	ITEM 2.	Offer Statistics and Expected Timetable	5
	ITEM 3.	Key Information	5
	ITEM 4.	Information on RepliCel Life Sciences Inc	11
	ITEM 4A	Unresolved Staff Comments	19
	ITEM 5.	Operating and Financial Review and Prospects	19
	ITEM 6.	Directors, Senior Management and Employees	23
	ITEM 7.	Major Shareholders and Related Party Transactions	29
	C.	Interests of Experts and Counsel	31
	Not applicable.		31
	ITEM 8.	Financial Information	31
	ITEM 9.	The Offer and Listing	33
	ITEM 10.	Additional Information	35
	ITEM 11.	Quantitative and Qualitative Disclosures About Market Risk	41
	ITEM 12.	Description of Securities Other Than Equity Securities	41

PART II			41
	ITEM 13.	Defaults, Dividend Arrearages and Delinquencies	41
	ITEM 14.	Material Modifications to the Rights of Security Holders and Use of Proceeds	42
	ITEM 15.	Controls and Procedures	42
	A. Disclosure Controls and Procedures		42
	ITEM 16.	[Reserved]	43
	ITEM 16A.	Audit Committee Financial Expert	43
	ITEM 16B.	Code of Ethics	44
	ITEM 16C.	Principal Accountant Fees and Services	44
	ITEM 16D.	Exemption from the Listing Standards for Audit Committees	45
	ITEM 16E.	Purchases of Equity Securities by the Issuer and Affiliated Purchasers	45
	ITEM 16F.	Change in Registrant’s Certifying Accountant	45
	ITEM 16G.	Corporate Governance	45
	ITEM 16H.	Mine Safety Disclosure	45
	ITEM 17.	Financial Statements	F-1
	ITEM 18.	Financial Statements	47
	ITEM 19.	Exhibits	47

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PART I

ITEM 1. Identity of Directors, Senior Management and Advisers

Not applicable.

ITEM 2. Offer Statistics and Expected Timetable

Not applicable.

ITEM 3. Key Information

A. Selected Financial Data

The following financial data summarizes selected financial data for our company prepared in accordance with IFRS as issued by the International Accounting Standards Board (the “ IASB ”) for the two fiscal years ended December 31, 2011 and 2010. The information presented below for the two year period ended December 31, 2011 and 2010 is derived from our financial statements which were examined by our independent auditor. The information set forth below should be read in conjunction with our audited annual financial statements and related notes thereto included in this annual report, and with the information appearing under the heading “Item 5 – Operating and Financial Review and Prospects”.

Selected Financial Data
(Stated in Canadian Dollars – Calculated in accordance with IFRS)

		Year ended Dec. 31, 2011 (audited)			Year ended Dec. 31, 2010 (audited)
Net sales or operating revenues	$	-		$	-
Total expenses		3,713,439			2,542,525
Loss from operations and continuing operations		(3,713,439	)		(2,542,525	)
Net loss		(3,713,439	)		(2,542,525	)
Basic and diluted loss from operations and continuing operations, per share		(0.10	)		(0.12	)
Total assets		631,419			1,308,742
Net assets (capital deficit)		401,450			685,447
Share capital		6,266,739			3,344,320
Weighted average number of common shares outstanding (adjusted to reflect changes in capital)		39,442,240			21,567,675
Long-term debt		-			-

Disclosure of Exchange Rate History

Since June 1, 1970, the government of Canada has permitted a floating exchange rate to determine the value of the Canadian dollar as compared to the United States dollar. On April 24, 2012, the exchange rates in effect for Canadian dollars exchanged for United States dollars, expressed in terms of Canadian dollars (based on the noon buying rate of the Bank of Canada), was Cdn $0.9883 for each one US dollar. For the past five fiscal years ended December 31, 2011 and for the monthly periods subsequent to that date, the following exchange rates were in effect for Canadian dollars exchanged for United States dollars, expressed in terms of Canadian dollars (based on the noon buying rates in New York City, for cable transfers in Canadian dollars, as certified for customs purposes by the Federal Reserve Bank of New York):

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Year	Average
December 31, 2007	1.0742
December 31, 2008	1.0659
December 31, 2009	1.1409
December 31, 2010	1.0223
December 31, 2011	0.9887

Month	High / Low
November 2011	1.0487/1.0125
December 2011	1.0403/1.0106
January 2012	1.0272/0.9986
February 2012	1.0016/0.9941
March 2012	1.0013/0.9848
April 2012	1.0039/0.9878

B. Capitalization and Indebtedness

Not applicable.

C. Reasons for the Offer and Use of Proceeds

Not applicable.

D. Risk Factors

Much of the information included in this annual report includes or is based upon estimates, projections or other “forward-looking statements”. Such forward-looking statements include any projections or estimates made by our company and our management in connection with our business operations. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Such estimates, projections or other forward-looking statements involve various risks and uncertainties as outlined below. We caution the reader that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other forward-looking statements.

The common shares of our company are considered speculative. You should carefully consider the following risks and uncertainties in addition to other information in this annual report in evaluating our company and our business before purchasing any shares of our company. Our business, operating and financial condition could be harmed due to any of the following risks.

Risks Relating to our Business

Our company currently does not generate revenue from its planned operations, and as a result, it faces a high risk of business failure.

We have not generated any revenues from our planned operations to date. As of December 31, 2011, we had accumulated $6,870,221 in losses since inception. Our business is focused on the development of a new hair cell replication technology. In order to generate revenues, we will incur substantial expenses in the development of our business. We therefore expect to incur significant losses in the foreseeable future. Our company recognizes that if we are unable to generate significant revenues from our activities, our entire business may fail. There is no history upon which to base any assumption as to the likelihood that we will be successful in our plan of operation, and we can provide no assurance to investors that we will generate operating revenues or achieve profitable operations in the future.

Our auditors’ opinion on our December 31, 2011 financial statements includes an explanatory paragraph in respect of there being substantial doubt about our ability to continue as a going concern.

We have incurred a net loss of $6,870,221 for the cumulative period from September 7, 2006 (inception) to December 31, 2011. We anticipate generating losses for at least the next 12 months. Therefore, there is substantial doubt about our ability to continue operations in the future as a going concern, as described by our auditors with respect to the financial statements for the year ended December 31, 2011. Our financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event that we cannot continue in existence. Our business operations may fail if our actual cash requirements exceed our estimates and we are not able to obtain further financing. If we cannot continue as a viable entity, our shareholders may lose some or all of their investment in our company.

Our business is at an early stage of development and difficulties obtaining regulatory approval, technical deficiencies and other challenges may hinder the development and marketing of our hair cell replication technology.

Our hair cell replication technology is at an early stage of development and we may not develop hair cell replication technology that can be commercialized. We are still in the early stages of identifying and conducting research on our technology. Our technology will require significant research and development and preclinical and clinical testing prior to regulatory approval, if required, being obtained in the United States or other countries. We may not be able to obtain regulatory approvals, if required, to complete necessary clinical trials for our hair cell replication technology, or to commercialize it. Our technology may prove to have undesirable and unintended side effects, or other characteristics adversely affecting its safety, efficacy or cost-effectiveness could prevent or limit its use. Our technology may fail to provide its intended benefit, or achieve benefits equal to or better than our competitor’s products at the time of testing or production and, if so, our business may fail.

Our clinical trials may fail to produce successful results or could be suspended due to unacceptable safety risks, which could cause our business to fail.

Clinical trials are subject to extensive regulatory requirements, and are very expensive, time-consuming and difficult to design and implement, in part because they may be subject to rigorous regulatory requirements. Our products may fail to achieve necessary safety and efficacy endpoints during clinical trials. We believe that our clinical trials will take a substantial period of time to complete. Furthermore, failure can occur at any stage of the trials, and we could encounter problems that cause us to abandon or repeat clinical trials. The commencement and completion of clinical trials may be delayed by several factors, including: unforeseen safety issues; lack of effectiveness during clinical trials; slower than expected rates of patient recruitment; and inability to monitor patients adequately during or after treatment. In addition, we or regulatory officials may suspend our clinical trials at any time if it appears that we are exposing participants to unacceptable health risks. If our clinical trials fail to produce successful results, or are suspended due to unacceptable safety risks, our business may fail.

Our success depends on the acceptance of our hair cell replication technology by the medical community and consumers as a safe and effective solution.

The success of our hair cell replication technology will depend on its acceptance by potential consumers and the medical community. Because our technology is new in the treatment of pattern baldness, the long term effects of using our new hair cell replication technology are unknown. The results of short-term clinical trials do not necessarily predict long-term clinical benefit or reveal adverse effects. If results obtained from future commercial experience indicate that our hair cell replication technology is not as safe or effective as other hair restoration treatments, adoption of this technology by consumers and the medical community may suffer and our business will be harmed.

If we are not able to effectively protect our existing intellectual property, our business may suffer a material negative impact and may fail.

The success of our company will be dependent on our ability to protect and develop our technology. We currently have registered patents for our hair cell replication technology in Australia and the European Union. If we are unable to protect our intellectual property, our business may be materially adversely affected. Further, we cannot be sure that our activities do not and will not infringe on the intellectual property rights of others. If we are compelled to prosecute infringing parties, defend our intellectual property or defend ourselves from intellectual property claims made by others, we may face significant expense and liability, as well as the diversion of management’s attention from our business, any of which could negatively impact our business or financial condition.

The successful acquisition and maintenance of patent rights is critical to our business and any failure in this regard could hinder the development and marketing of our technology.

We currently have patent applications pending in the United States and several other countries around the world. Our pending patent applications may not result in the issuance of any patents. The applications may not be sufficient to meet the statutory requirements for patentability in all cases or may be the subject of interference proceedings by patent offices. These proceedings determine the priority of inventions and, thus, the right to a patent for technology. In the past, our patent applications have experienced delays and our patent applications may be delayed in the future. If others file patent applications or obtain patents similar to those we have licensed, such patents may restrict the use of our discoveries. The risk of third parties obtaining patents and filing patent applications will continue to increase as the hair restoration market expands. We cannot predict the ultimate scope and validity of existing patents and patents that may be granted to third parties, nor can we predict the extent to which we may wish or be required to obtain licenses to use such patents, or the availability and cost of acquiring such licenses. To the extent that licenses are required, the owners of the patents could bring legal actions against us to claim damages or to stop our manufacturing and marketing of the affected technology. If we become involved in patent litigation, it could consume a substantial portion of our resources.

Competitors in the hair restoration and related fields may currently offer, or may develop, superior hair loss solutions which could limit the market for our technology.

The market for hair restoration products and technology is competitive. We expect that some of our most significant competitors will be more established companies. These companies may have greater capital resources or experience in research and development, manufacturing, testing, obtaining regulatory approvals or marketing capabilities. As a result, our competitors may develop more competitive or affordable products, or achieve earlier patent protection or product commercialization than we are able to achieve. We face competition from companies offering traditional more established products and technologies.

Our company may be subject to changes and uncertainties in laws and government regulations.

Our company is subject to regulation by domestic and foreign governmental agencies with respect to many aspects of developing hair cell replication technology. In addition, relevant new legislation or regulation could occur. Any such new legislation or regulation, the application of laws and regulations from jurisdictions whose laws do not currently apply to our company’s business, or the application of existing laws and regulations to hair cell replication technology, could have a material adverse effect on our company’s business, prospects, financial condition and results of operations.

Risks Relating to our Management

We are dependent on the services of certain key consultants and the loss of any of these key consultants may have a materially adverse effect on our company.

While engaged in the business of developing a new hair cell replication technology, our company’s ability to continue to develop a competitive edge in the marketplace will depend, in large part, on our ability to attract and maintain qualified key management personnel. Competition for such personnel is intense, and we may not be able to attract and retain such personnel. Our company’s growth has depended, and in the future will continue to depend, on the efforts of our key management consultants. Loss of any of these people would have a material adverse effect on our company. Currently, our company does not have key-man life insurance.

Conflicts of interest may arise as a result of our company’s directors and officers being directors or officers of other life sciences companies.

Certain of our company’s directors and officers are, or may become, directors or officers of other life sciences companies. While we are engaged in the business of developing a new hair cell replication technology, such associations may give rise to conflicts of interest from time to time. Our company’s directors are required by law to act honestly and in good faith with a view to our company’s best interests and to disclose any interest that they may have in any project or opportunity of our company. If a conflict of interest arises at a meeting of our company’s board of directors, any director in a conflict must disclose his interest and abstain from voting on such matter. In determining whether or not our company will participate in any project or opportunity, our company’s directors will primarily consider the degree of risk to which our company may be exposed and our financial position at the time.

Our articles contain provisions indemnifying our officers and directors against all costs, charges and expenses incurred by them.

Our articles contain provisions limiting the liability of our officers and directors for all acts, receipts, neglects or defaults of themselves and all of our other officers or directors or for any loss, damage or expense incurred by our company which may happen in the execution of the duties of such officers or directors. Such limitations on liability may reduce the likelihood of derivative litigation against our company’s officers and directors and may discourage or deter our shareholders from suing our company’s officers and directors based upon breaches of their duties to our company, though such an action, if successful, might otherwise benefit our company and our shareholders.

As a majority of our directors and officers are residents of countries other than the United States, investors may find it difficult to enforce, within the United States, any judgments obtained against our company, directors and officers.

We are a British Columbia, Canada company. A majority of our directors and officers are nationals and/or residents of countries other than the United States, and all or a substantial portion of such persons' assets are located outside the United States. Consequently, it may be difficult for United States investors to effect service of process in the United States upon those directors or officers who are not residents of the United States, or to realize in the United States upon judgments of United States courts predicated upon civil liabilities under United States legislation. There is substantial doubt whether an original action based solely upon such civil liabilities could be brought successfully in Canada against any of such persons or our company.

Risks Relating to our Common Stock

If our business is unsuccessful, our shareholders may lose their entire investment.

Although shareholders will not be bound by or be personally liable for our expenses, liabilities or obligations beyond their total original capital contributions, should we suffer a deficiency in funds with which to meet our obligations, the shareholders as a whole may lose their entire investment in our company.

Trading of our company’s common shares on the OTC Bulletin Board is limited and sporadic, making it difficult for our company’s shareholders to sell their shares or liquidate their investments.

The trading price of our company’s common shares has been and may continue to be subject to wide fluctuations. The stock market has generally experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies with little or no current business operations. There can be no assurance that trading prices and price earnings ratios previously experienced by our company’s common shares will be matched or maintained. These broad market and industry factors may adversely affect the market price of the common shares, regardless of our company’s operating performance. In the past, following periods of volatility in the market price of a company’s securities, securities class-action litigation has often been instituted. Such litigation, if instituted, could result in substantial costs for our company and a diversion of management’s attention and resources.

Investors’ interests in our company will be diluted and investors may suffer dilution in their net book value per share if we issue additional options to any of our officers, directors, employees or consultants.

Because our company’s success is highly dependent upon our directors, officers and consultants, we have granted, and may again in the future grant, options to some or all of our key officers, directors, employees and consultants to purchase our common shares as non-cash incentives. Options may be granted at exercise prices below that of our common shares prevailing in the public trading market at the time or may be granted at exercise prices equal to market prices at times when the public market is depressed. To the extent that significant numbers of such options may be granted and exercised, the interests of our company’s other shareholders may be diluted.

Investors’ interests in our company will be diluted and investors may suffer dilution in their net book value per share if our company issues additional shares or raises funds through the sale of equity securities.

In the event that our company is required to issue additional shares in order to raise financing, investors’ interests in our company will be diluted and investors may suffer dilution in their net book value per share depending on the price at which such securities are sold. The dilution may result in a decline in the market price of our company’s shares.

Penny stock rules limit the ability of our shareholders to sell their stock.

The SEC has adopted regulations which generally define “penny stock” to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and Accredited Investors. 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 in a form prepared by the SEC, which 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 salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities.

The Financial Industry Regulatory Authority, or FINRA, has adopted sales practice requirements which may also limit a shareholder's ability to buy and sell our stock.

In addition to the “penny stock” rules described above, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

We do not intend to pay dividends on any investment in the shares of stock of our company.

We have never paid any cash dividends and currently do not intend to pay any dividends for the foreseeable future. To the extent that we require additional funding currently not provided for in our financing plan, our funding sources may prohibit the payment of a dividend. Because we do not intend to declare dividends, any gain on an investment in our company will need to come through an increase in the stock’s price. This may never happen and investors may lose all of their investment in our company.

ITEM 4. Information on RepliCel Life Sciences Inc.

A. History and Development of RepliCel Life Sciences Inc.

Name

Our legal name is “RepliCel Life Sciences Inc.”. We changed our name from “Newcastle Resources Ltd.” on June 22, 2011.

Principal Office

Our principal office is located at Suite 1225 – 888 Dunsmuir Street, Vancouver, British Columbia, Canada V6K 3C4. Our telephone number is (604) 248-8730 and our facsimile number is (604) 248-8690.

Corporate Information and Important Events

Our company was incorporated under the laws of the Province of Ontario (specifically under the Business Corporations Act (Ontario)) on April 24, 1967 under the name “Jolly Jumper Products of America Limited”. On September 25, 1987, our name was changed to “Sun Valley Hot Springs Ranch Inc.”. We changed our name to “Tri-Valley Free Trade Inc.” on March 26, 1991 and to “Tri-Valley Investments Corporation” on June 19, 1995. On October 2, 1998, we changed our name to “Tri-Lateral Venture Corporation”. On May 6, 2004, we changed our name to “Pan American Gold Corporation” and on November 10, 2008, we changed our name to “Newcastle Resources Ltd.”. On June 22, 2011 we filed a continuance in British Columbia and changed our name to “RepliCel Life Sciences Inc.” We are a reporting issuer under the securities laws of the Provinces of British Columbia and Ontario. Under the Business Corporations Act (British Columbia), our company has an indefinite life span.

On November 10, 2008, our issued and outstanding common shares were consolidated on the basis of one (1) common share for every (30) common shares held and our name was changed to Newcastle Resources Ltd. The reverse split and name change were effected with the OTC Bulletin Board on November 28, 2008, at which time our trading symbol was changed to “NCSLF”.

On December 22, 2010, we filed articles of amendment with the corporate registrar of the Province of Ontario, authorizing the creation of Class B preference shares and Class C preference shares.

Also on December 22, 2010, we completed the acquisition of two subsidiaries, TrichoScience Innovations Inc. (“ TrichoScience ”) and 583885 B.C. Ltd. (“ 583885 ”) pursuant to share exchange agreements dated October 29, 2010 with each of those companies. We determined to treat the acquisition of the shares of TrichoScience as a reverse acquisition for accounting purposes. As a result, our auditors changed from Manning Elliott LLP, our prior auditors, to BDO Canada LLP, the auditors of TrichoScience. As a result of this acquisition, we ceased to be involved in the mineral exploration sector and our business became the development of hair cell replication technology. We believe this technology has the potential to become the world’s first autologous treatment for pattern baldness and general hair loss in both men and women.

Under the TrichoScience share exchange agreement (the “ TrichoScience Agreement ”), we agreed to acquire up to all of the issued and outstanding common shares of TrichoScience on the basis of one unit of our company for each TrichoScience common share. Each unit consisted of 2.295300893 common shares, 1.1476504 Class B preference shares and 1.1476504 Class C preference shares. Upon the closing of the TrichoScience Agreement, we acquired a total of 4,860,000 TrichoScience common shares in exchange for the issuance of 4,860,000 units of our company comprised of an aggregate of: (i) 11,155,165 common shares; (ii) 5,577,580 Class B preference shares, and (iii) 5,577,580 Class C preference shares.

Pursuant to the terms of the TrichoScience Agreement, all shareholders of TrichoScience who did not tender their shares of TrichoScience to our company on December 22, 2010, were given the right to exchange their TrichoScience shares at any time during the following 18 months on the same exchange ratio as set forth above. As at December 31, 2011, all TrichoScience shareholders had exchanged their shares for units of our company. As a result, we issued a total (including the share issuances described in the preceding paragraph) of 22,000,000 common shares, 11,000,000 Class B shares and 11,000,000 Class C shares to the former shareholders of TrichoScience (including the shares issued on December 22, 2010). Because the rights and restrictions of the Class B preference shares provided that all such shares would be extinguished upon our company: (i) acquiring at least 90% of the TrichoScience shares; and (ii) investing at least $3,000,000 in TrichoScience, all of our outstanding Class B preference shares were extinguished effective April 29, 2011.

As a result of the completion of the acquisition of all of the TrichoScience shares, TrichoScience is now a wholly-owned subsidiary of our company. All of the common shares of our company acquired by former shareholders of TrichoScience have been deposited with a trustee pursuant to the terms of a pooling agreement. The common shares are subject to a timed release schedule under which 15% of the shares have been or will be released on the first day of each of the fiscal quarters occurring after the first anniversary of the respective share exchanges. We issued all of these shares to non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933, as amended.

In connection with the closing of the TrichoScience Agreement, TrichoScience caused all outstanding TrichoScience options to be cancelled and we agreed to grant each of the holders of such options one option to acquire one of our common shares in exchange for each TrichoScience option that was cancelled. At the same time, we completed the purchase of 1,000,000 common shares of TrichoScience from its treasury at a price of $1.00 per share. Subsequent to December 22, 2010, in accordance with the terms of the TrichoScience Agreement, we purchased an additional 2,050,000 TrichoScience common shares from its treasury at a price of $1.00 per share.

Concurrent with the acquisition of TrichoScience, we also acquired all of the issued and outstanding common shares of 583885 B.C. Ltd. (“ 583885 ”) in exchange for the issuance of 4,400,000 common shares of our company. 583885 did not have any assets or liabilities at the date of acquisition and was a private company controlled by our incoming Chief Executive Officer. 3,400,000 common shares controlled by the Chief Executive Officer were deposited with an escrow agent pursuant to the terms of an escrow agreement, to be released upon satisfaction of certain performance conditions as set out in the escrow agreement. 583885 was dissolved effective July 29, 2011.

During the year ended December 31, 2011, the performance conditions with respect to the release of 350,000 shares (December 31, 2010: 850,000) had been achieved, and $178,045 (December 31, 2010: $432,295) (representing the fair value of the shares released from escrow on the date of release) was recorded as stock-based compensation. Compensation expense relating to the transaction date fair value of the remaining 2,200,000 common shares will be recognized in the period the respective performance condition is probable and amortized over the period until the performance condition is met.

On June 22, 2011 we filed a continuance application with the corporate registrar of the Province of British Columbia and pursuant to which we continued our jurisdiction of incorporation from the Province of Ontario to the Province of British Columbia. In connection with the continuance, we adopted new articles and changed our name to “RepliCel Life Sciences Inc.”. As all of the outstanding Class B preference shares had been cancelled in accordance with their terms shortly before the continuance, we continued to the Province of British Columbia with our authorized capital consisting of an unlimited number of common shares without par value, an unlimited number of Class A preference shares without par value and an unlimited number of Class C preference shares without par value.

On November 29, 2011, 13,000,000 of the Class C preference shares, being all the issued and outstanding Class C shares, were converted on a 5:1 ratio, into 2,600,000 common shares by the holders thereof. All of the common shares issued on conversion of the Class C shares were deposited with a trustee pursuant to the terms of pooling agreements. The common shares are subject to a timed release schedule under which 15% of the shares will be released on the first day of each of the fiscal quarters beginning January 1, 2013.

On December 5, 2011, we filed articles of amendment with the corporate registrar of the Province of British Columbia, cancelling the Class C preference shares.

Capital Expenditures

During the last three fiscal years ended December 31, 2011, we did not undertake any capital expenditures. In connection with the closing of the TrichoScience Agreement, we acquired 1,000,000 common shares of TrichoScience at a price of $1.00 per share. This acquisition was internally financed, partially from the proceeds of the private placement for gross proceeds of US$620,000 that we undertook in connection with the closing of the TrichoScience Agreement, as described above under the heading “Corporate Information and Important Events”. On March 11, 2011, we acquired an additional 2,050,000 shares of TrichoScience at a price of $1.00 per share. This acquisition was internally financed from the proceeds of our March 2011 private placement for gross proceeds of US$2,550,000, as described above under the heading “Corporate Information and Important Events”.

Takeover offers

We are not aware of any indication of any public takeover offers by third parties in respect of our common shares during our last and current financial years.

B. Business Overview and Plan of Operations

Overview

RepliCel Life Sciences Inc. is a British Columbia, Canada, company that is in the business of developing and patenting a new hair follicle cell replication technology that has the potential to become the world’s first autologous cellular treatment for hair loss in men and women. Our cellular replication and implantation technology is designed to grow new hair follicles in patients suffering from androgenetic alopecia. The procedure is also designed to rejuvenate damaged, miniaturized hair follicles in balding scalp skin.

Research and Development

Our technology has been developed over nine years of research, experimentation and trials. The mechanics of our technology involve the extraction of as few as 20 hair follicles from the back of a patient’s scalp where healthy cycling hair follicles reside. Specific cells are isolated from the hair follicles and are then replicated in a current Good Manufacturing Practice (“ cGMP ”) compliant facility through our proprietary cellular replication process and then reintroduced back into balding areas on a patient’s scalp. The implanted cells are expected to induce the formation and growth of new hair follicles and are expected to also help rejuvenate damaged hair follicles. Our anticipated long term result is the restoration of a full head of hair that has been seeded by the patient’s own natural hair cells.

The product development path of our technology effectively began in 2000/03 when Drs. McElwee and Hoffmann began focusing on specific groups of cells in the hair follicle described as dermal sheath cup cells (“ DSCs ”). Together they hypothesized that these DSCs were a reservoir of cells that were responsible for the continued cycling of the hair follicle, as well as neogenesis of new hair follicles. Multiple experiments on purpose-bred mice demonstrated that hair follicle DSCs could induce successful hair growth. The scientists’ landmark study was published in the peer-reviewed Journal of Investigative Dermatology in ©2003. Together, the scientists filed patent applications. To date, patents have been issued in Europe and Australia, and are now pending in the US, Canada and Japan.

These results have led us to believe in the effectiveness of the procedure and its potential to become a solution to hair loss for the hair restoration market. From 2004 to 2007, the developers of our technology planned for human clinical trials and cell culture laboratories, and sourced initial funding. In 2007, the developers of the technology assigned the technology, including the intellectual property, to TrichoScience Innovations Inc. (“ TrichoScience ”), all of the shares of which we acquired, in stages, between December 2010 and April 2011.

We believe our technology will offer several advantages over current hair loss solutions. Traditional hair transplantation surgery requires the surgical removal of a prominent band of hair-bearing scalp from the back of the head, dissection of individual hair follicles and then implantation of these follicles into the balding region of the scalp. Often, a number of similar surgical procedures are required to achieve the desired result. In effect, surgical hair transplantation removes and redistributes a patient’s own hair follicles to cover sections of bald scalp, leaving a longitudinal scar across the back of a patient’s scalp where the strip of skin tissue carrying the hair follicles was removed. In follicular unit extraction (“ FUE ”) transplants, the back of the scalp is left with multiple small round wound marks where the micro extractions have occurred.

In contrast, our technology is designed to replicate a patient’s hair cells and rejuvenate miniaturized hair follicles, as well as induce entirely new follicles to grow from the balding scalp with only a minor single suture closure from the tissue extraction site. We believe there will be minimal pain involved and a short recovery period. Our technology is designed to provide the ability to grow a patient’s own hair back, rather than to redistribute hair from the back of the scalp to the front.

In addition, hair transplantation surgery requires a team of six or more people, including up to four technicians trained in micro-dissection. The surgical procedure takes up to eight hours to complete. Our technology is designed to be fully performed by a single clinician who requires minimal additional training. We expect the time involved in the clinic to be less than thirty minutes for tissue collection and less than one hour for cell injection.

Existing Market Conditions

Although we have not yet generated any revenues from our technology, there is a very large potential market for our technology, should it be effective and obtain the necessary regulatory approvals.

The worldwide market for surgical hair restoration has been calculated at US$1.8 billion annually by the International Society of Hair Restoration Surgery (the “ ISHRS ”), with the US market accounting for 36% of that total (US$550 million). Between 2008 and 2010, the hair restoration surgery market increased 47% worldwide. The biggest increases were in the Middle East (454%) and Asia (345%). The American Academy of Family Physicians (the “ AAFP ”) estimates the US market for non-surgical hair loss treatments at over US$1.2 billion annually. The drugs minoxidil (Rogaine®) and finasteride (Propecia®) together account for a large portion of the non-surgical market.

Established industry figures as noted above point to an annual worldwide hair restoration market of US $3 billion. However, it is clear that the market is significantly larger based on the broad range of hair loss appliances, treatments, techniques and topical applications that are widely available today. We believe the potential to deliver a minimally invasive surgical, non-drug based procedure such as ours will offer us access to all current hair loss treatment markets. Our technology could serve as a catalyst to grow the market, even while usurping both existing surgical and nonsurgical procedures, given its potential permanent results and minimally invasive surgical basis. It will also bring women into the market where they have traditionally rejected invasive surgical procedures and avoided the side effects of drug treatments. According to the ISHRS, in 2010, 85.9% of hair restoration surgical patients were men, and 14.1% were women. It is anticipated that a cell-based treatment like RepliCel’s could address the unmet market for women who currently have no real solution to their hair loss.

Current Hair Loss Treatments

Surgical Hair Restoration

Medical hair restoration consists of a variety of surgical hair restoration treatments designed to reduce baldness. Follicular unit hair transplant (“ FUT ”) surgery is by far the dominant hair restoration treatment and involves the surgical removal of large portions of hair-bearing scalp from the back of the head. These sections of scalp skin are then dissected by hand into smaller hair follicle clusters (follicular units) and transplanted to the balding areas of a patient’s scalp.

Follicular unit extraction or FUE is another type of hair transplant technique in which a small round punch is used to extract follicular units from a patient’s baldness-resistant donor areas. These 1, 2, 3 and 4-hair follicular unit grafts are then transplanted into a patient’s balding areas. This is a time consuming and tedious procedure and a physician is often limited to transplanting 500 to 600 follicular unit grafts in one day. While the FUE procedure has grown in popularity, largely due to the minimally invasive way in which follicular unit grafts are removed, the standard strip excision method is still the leading hair transplant procedure.

However, FUT and FUE hair transplant surgery will always be limited by the availability and quality of donor hair follicles. Hair replacement surgery is a complicated procedure that may require several hair transplant sessions over a period of one to two years before the desired result is achieved. Ultimately, the act of hair transplantation does not ‘create’ new hair. The process simply relocates viable hair from the back of the scalp to the front. Most women will not undergo this extremely invasive surgery. In terms of cosmetic results, both FUT and FUE surgery are quite dependent upon the skill of the surgeon. Scalp flap surgery, scalp reduction surgery and scalp expansion surgery are other forms of surgical hair restoration. Combined, these treatments represent a far smaller patient base than hair transplant surgery.

Non-Surgical Restoration

Only two drug hair restoration treatments approved by the United States Food and Drug Administration (the “ FDA ”) are available today: minoxidil and finasteride. Minoxidil is marketed as Rogaine ^® and finasteride is marketed as Propecia ^® . These two products can be effective in hair loss prevention and may grow new hair. However, once a patient begins using Rogaine ^® or Propecia ^® , he or she must continue to use the products indefinitely. As with any drug, adverse reactions can sometimes occur.

Rogaine ^® (Minoxidil)

Rogaine ^® (minoxidil) was introduced in 1988 as the first drug approved for treatment of baldness by the FDA. It is now available over-the-counter in several countries including the USA. Minoxidil remains the only product available without a prescription that has been approved by the FDA as a proven treatment against hair loss. Minoxidil is no longer under patent so it is also marketed as a number of topical treatments made by several different companies. Minoxidil stimulates hair growth in individuals with male and female pattern baldness; however, the mechanism of action is unknown. It comes in 2% and 5% topical formulations and known side effects include itching and skin irritation of the treated scalp, as well as unwanted hair in areas adjacent to treatment sites which can be distressing to women when the face is involved. Once treatment is stopped, all results will be lost within 3 to 6 months.

Propecia ^® (Finasteride)

Finasteride is marketed by Merck under the trademark names Proscar® and Propecia®, among other generic names. It is a synthetic antiandrogen that inhibits type II 5-alpha reductase, the enzyme that converts testosterone to DHT. Only available by prescription, it was developed to treat mild to moderate male pattern hair loss on the vertex (top of head) and anterior mid-scalp area (middle front of head) in men only. There is insufficient evidence that Propecia® works for receding hairlines at the temples. Listed side effects include erectile dysfunction and depression. Once treatment is stopped, all results will be lost within 6 to 12 months.

Competition

Aderans Research Institute

The Aderans Research Institute (“ ARI ”), headquartered in Atlanta, is the research arm of two hair restoration companies: Aderans Co., Ltd., a leading manufacturer of wigs in Japan; and Bosley, a leading hair transplant company in the USA now owned by Aderans. ARI is researching a method of hair replication using a cell culture technology referred to as the Ji Gami™ process. Aderans is viewed as a potential competitor with first mover advantage. The RepliCel™ and Aderans technologies, when approved, will ultimately compete on results and cost. Relative efficacy is yet to be determined.

Histogen Inc.

Histogen is developing a hair replacement product that is based on the products of newborn cells grown under embryonic conditions.

Histogen has completed a 24-subject clinical trial on its Hair Stimulating Complex (HSC). This double-blind, placebo-controlled study evaluated the safety in the clinical application of the product as an injectable for hair growth. No adverse events were seen at any time point, including the one year follow-up. Histogen is working on a Phase I/II study expected to start spring 2012 in Singapore to further examine safety and efficacy. Histogen’s clinical trials are not listed on the clinicaltrials.gov website.

Follica Inc.

Follica Inc. is developing a treatment that stimulates the re-growth of hair follicles by harnessing their natural wound-healing response. Follica’s clinical trials are not listed on the clinicaltrials.gov website.

Marketing Strategy Overview

We have launched a branded corporate website which can be viewed at www.replicel.com to provide corporate information and information about our technology and the progress of our clinical trials. In the future, this site will act as our principal marketing and communications tool and, in time, we will add sections appropriate to our targeted key audiences – medical professionals, hair restoration clinics and appropriate professional associations. All marketing and communications efforts will feature a constant internet based strategy which we anticipate will allow us to leverage our technology advantages and brand to generate license sales.

We expect that, eventually, a highly targeted marketing effort will supplement the broad communications tactics and website with a focused direct sales campaign to primary licensee markets. We have identified the primary licensee market as more than 800 hair restoration physicians.

Business Model

The RepliCel™ procedure will be marketed directly to those medical professionals currently engaged in hair transplant procedures, as well as established hair loss and dermatology clinics. Access to, and application of the procedure will be offered to these establishments under a licensing arrangement. Clinicians will be charged a license fee by the company on an annual basis. We will then train and educate the clinicians in the RepliCel™ procedure. Clinicians will extract the patient’s tissues through a punch biopsy which will then be shipped to our cGMP facilities where cells will be isolated and proprietary cellular replication will take place. We will be able to maintain full control over the cellular replication process through the use of our own contracted facilities and our own trained technicians. We will charge the clinic a per-patient replication fee, while the clinic will be free to set the price it charges the patient, based on what the market will bear. Therefore, we will have two revenue streams: patient fees and annual license fees.

Regulatory Environment

The process of obtaining marketing authorization for the RepliCel™ procedure requires the collection of a thorough body of information that satisfies requirements set forth by regulators that oversee the safety and efficacy of products sold to the public. Each jurisdiction has specific regulatory requirements, many of which differ from region to region.

We are developing a clinical and regulatory strategy that will ensure adherence to regulations that will advance the marketing approval of our technology worldwide. As part of this strategy, plans for the following projects are in development:

1.	Completion of a Phase I/IIa human clinical trial in Europe; TS001-2009 trial commenced in December, 2010;
2.	Ongoing research and pre-clinical development to enhance knowledge base of our technology; and
3.	Initiation of Phase IIb human dosing clinical trials in Europe and/or North America.

Phase I/IIa: TS001-2009

The protocol for the TS001-2009, Phase I/IIa study was developed with advice from European Union regulatory authorities responsible for advanced therapy medicinal products (ATMPs) of which our product is one. The clinical trial is designed to test the safety and efficacy of our technology in men and women with AGA through the assessment of the following endpoints:

1.	Primary Endpoint: local safety profile of our technology at the 6-month time point as defined by the incidence, relationship, severity and seriousness of adverse events at the injection sites and local tolerance (as judged by the investigator and patient);

2.	Secondary safety endpoints:

	a.	the local safety profile (as defined above) of our technology at the 12 and 24 month time points,
	b.	systemic adverse events over the 24-month study,
	c.	analysis of macroscopic images of injection sites, and
	d.	analysis of histopathological biopsies taken at the 6, 12 and 24 month time points; and

3.	Secondary efficacy endpoint:

difference in hair thickness and hair density between 6 months (Visit 7) and baseline will be calculated using the TrichoScan ^® procedure.

The protocol, designed in compliance with International Conference on Harmonisation guidelines for Good Clinical Practice (ICH GCP), underwent thorough scientific and ethical review by the Georgian National Council of Bioethics and approval to conduct the study was granted on October 27, 2010.

Subjects with mild to moderate AGA categorized on the Ludwig Scale (female) or the Norwood scale (male) were enrolled in the study over a 4-month period starting in December 2010. These subjects provided blood samples to confirm their health status and scalp biopsies which were sent to a cGMP-compliant facility with the specific license to manufacture our product in Austria.

Once the manufacturing process was completed, the 19 subjects returned to the clinic to receive blinded injections of their own (autologous) replicated cells in a carrier medium on one part of the scalp, and another injection of carrier medium without replicated cells (placebo) on the other side of the scalp to allow for better assessment of the safety and efficacy of our technology. The final study participant received injections of hair follicle cells in late August 2011, thus marking the end of the treatment phase of TS001-2009.

In the next stage of the TS001-2009 trial, the post-injection follow-up period, subjects return to the clinic for ten follow-up visits over a 24-month period to have their health closely monitored to ensure that there have been no adverse effects associated with receiving the injections and to determine the efficacy of hair follicle cell injections at stimulating hair growth. Furthermore, at 6, 12 and 24 months post-injection, four subjects at each time point will provide biopsies of the injection sites for histopathological analysis. The post-injection follow-up period will be completed for all patients by the end of August 2013. The total duration of subject participation in the study is approximately 27 months.

An interim analysis of data is scheduled to take place in the first quarter of 2012 once all patients have had a 6-month follow-up visit. This data will allow for analysis of the primary endpoint of the study; assessment of the local (at treatment sites) safety profile of our product compared to placebo as defined by adverse events with respect to their causality, incidence, severity and seriousness. Secondary outcome measures of systemic (overall) safety (through review of adverse events in a similar fashion as described above) and efficacy (hair growth at treatment sites) will also be performed at this time. Analysis of efficacy will also be studied at 9, 12 and 24 months.

Final analysis of safety data from the entire 24-month post-injection follow-up period should be available in late 2013. To date, no serious adverse events have been reported post-injection.

Pre-Clinical Research

Even though our product has already started testing in human subjects; we continue to perform pre-clinical research to improve the production and delivery of our product. Currently we are conducting such research with our partners in Guangzhou, China; Innsbruck, Austria; and Vancouver, Canada in conjunction with the guidance we have received from regulators in the European Union and Canada.

Phase IIb Dosing Clinical Trials

Results from the pre-clinical work will be included along with the study results from TS001-2009 in making the application to perform Phase IIb dosing clinical trials in Europe and North America. The process of making this application will allow regulators to provide feedback on our product and the methodology used to research its effects in humans. Such feedback will allow us to streamline our research efforts to ensure we can bring our product to those in need as quickly and safely as possible.

Intellectual Property

The success of RepliCel will be highly dependent on the protection of our intellectual property. We are developing a diverse portfolio of intellectual property for the use of stem cells in the treatment of hair loss, as well as other medical conditions. For example, RepliCel inventors filed an early patent application on the use of hair follicle derived stem cells (see EP 1 509 597 B1) entitled “Method for isolating hair follicle mesenchymal stem cells”. This family of patents describes methods for isolating stem cells from hair follicles, and the growth and use of these stem cells for the treatment of a variety of medical conditions (including hair loss). Within this portfolio, there are granted patents in Australia (AU 2003246521) and Europe (EP1 509 597 B1), which were issued unopposed. Related patent applications are also pending in the United States, Canada and Japan.

Plan of Operations

The sections above contain a broad overview of our plan of operations on a go-forward basis. We intend to specifically focus on continuing our human trials in Europe and preparing for human trials in Canada. During this time, we will attempt to seek regulatory approval in those areas for our technology. We also intend to continue to focus on obtaining patents for our technology in various international jurisdictions. At the same time, we will be taking steps to implement our branding and marketing strategies discussed above under the heading, “Marketing Strategy”.

We currently have four full time employees, as well as five contractors. These employees have expertise in biotechnology management, clinical trials, financial management and communications.

C. Organizational Structure

We currently are the parent company of one wholly-owned subsidiary, TrichoScience. TrichoScience is federally incorporated under the Business Corporations Act (Canada).

D. Property, Plant and Equipment

Our head office is located at Suite 1225 – 888 Dunsmuir Street, Vancouver, BC V6K 3C4. Research and development is being conducted under contract with the University of British Columbia by Kevin McElwee, PhD at the UBC Dermatology facilities in Vancouver and by Dr. Rolf Hoffmann in Germany. We have no current plans to construct or lease dedicated laboratory facilities.

ITEM 4A Unresolved Staff Comments

Not applicable.

ITEM 5. Operating and Financial Review and Prospects

The information in this section is presented in accordance with International Financial Reporting Standards for 2010 and 2011. TrichoScience was incorporated on September 7, 2006 under the provisions of the Canada Business Corporations Act. It is a development stage company that has not yet realized any revenues from its planned operations. TrichoScience was largely inactive until 2009 and is now in the business of the development of a non-surgical hair cell replication technology to cure pattern baldness and general hair loss in both men and women. As stated above, TrichoScience is now a subsidiary of our company. As the shareholders of TrichoScience control more than 50% of the issued, voting common shares and preferred shares of our company as a result of our acquisition of the applicable shares of TrichoScience, we determined to treat the acquisition as a reverse acquisition for accounting purposes, with TrichoScience as the acquirer for accounting purposes. As such, the historical financial information included in our financial statements and in this Form 20-F, including discussion of the operating results that follow, are that of TrichoScience.

A. Operating Results

Year Ended December 31, 2011 Compared to Year Ended December 31, 2010

Our company had no revenue from operations during the years ended December 31, 2011 or 2010. General and administrative expenses totalled $2,674,532 for the year ended December 31, 2011 compared to $1,992,276 for the year ended December 31, 2010. The increase in general and administrative expenses was primarily the result of increased legal fees (2011: $118,950, 2010: $116,954), accounting and audit fees (2011: $120,357, 2010: $81,456), insurance (2011: $48,007, 2010: $30,472), marketing consulting fees (2011: $334,709, 2010: $57,353), office and telephone (2011: $98,911, 2010: $29,556), rent (2011: $81,330, 2010: $26,916), salaries (2011: $623,027, 2010: $109,830), and travel and promotion (2011: $130,098, 2010: $51,065). The increases in accounting and audit fees, legal fees, insurance, marketing consulting fees, office and telephone, rent, salaries and travel and promotion expenses were due to increased operational activities in 2011.

We recognized a stock based compensation charge of $947,272 for the year ended December 31, 2011 (2010: $1,176,900) for stock options granted under the Company stock option plan and founders stock option agreements described above under the heading “Information on RepliCel Life Sciences Inc. – Corporate Information and Important Events – Stock Options”. The overall decrease in stock-based compensation expense in 2011 compared to 2010 was primarily due to the share exchange with 583885 in 2010, 350,000 shares were released from escrow in 2011 upon the achievement of one milestone contained in the escrow agreement, compared to a release of 850,000 in 2010, resulting in decreased stock based compensation charge in 2011.

During the year ended December 31, 2011, we incurred costs of $637,649 relating to our clinical trials compared to $367,763 in the year ended December 31, 2010. We incurred research and development costs of $292,207 and intellectual property costs of $89,552 in 2011 compared to research and development costs of $132,100 and intellectual property costs of $50,386 in 2010. These increases were all the result of increased operational activities in 2011.

We incurred a net loss for the year ended December 31, 2011 of $3,713,439 or $0.10 per share on a basic and diluted basis compared to a net loss of $2,542,525 or $0.12 per share on a basic and diluted basis for the year ended December 31, 2010. The increased loss was the result of increased operational activities in 2011.

B. Liquidity and Capital Resources

We had working capital of $382,863 as at December 31, 2011 compared to working capital of $652,699 as at December 31, 2010.

		Year Ended			Year Ended
		December 31, 2011			December 31, 2010
		(IFRS)			(restated for IFRS)
Net cash used in Operating Activities	$	(3,115,623	)	$	(894,301	)
Net cash provided by (used in) Investing Activities		(12,929	)		1,089,215
Net cash provided by Financing Activities		2,482,170			412,704
Increase (decrease) in Cash during the Year	$	(646,382	)	$	607,618
Cash, Beginning of Year		1,211,525			603,907
Cash, End of Year	$	565,143		$	1,211,525

Operating Activities

During the year ended December 31, 2011, we used net cash in operating activities of $3,115,623 compared to $894,301 for the year ended December 31, 2010. The increase in cash used in operating activities was the result of increased operational activities in 2011, as discussed above.

Investing Activities

During the year ended December 31, 2011, the net cash used in investing activities was $12,929 compared to net cash provided of $1,089,215 for the year ended December 31, 2010. The decrease is a result of the cash acquired on the closing of the TrichoScience Agreement in 2010.

Financing Activities

During the year ended December 31, 2011, RepliCel issued 2,550,000 common shares at US$1.00 per share for proceeds of US$2,550,000. We issued 101,200 common shares as finder’s fees in connection with the private placement. At December 31, 2011, we had working capital of $382,863. Additional working capital will be required for general and administrative expenses and to further our business plans.

On February 29, 2012, we completed a private placement of 66,304 units at US$1.50 per unit for proceeds of US$99,456. Each unit issued consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase an additional common share at US$2.50 per share for a period of 24 months from the closing of the Financing.

On March 29, 2012, we completed a private placement of 876,042 units at a price of US$1.50 per unit for gross proceeds of US$1,314,065. Each unit issued consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase an additional common share at US$2.50 per share for a period of 24 months from the closing of the Financing.

On April 18, 2012, we completed a private placement of 502,667 units at a price of US$1.50 per unit for gross proceeds of US$754,001. Each unit issued consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase an additional common share at US$2.50 per share for a period of 24 months from the closing of the Financing. A finder’s fee of $36,000 was issued in connection with the Financing.

We anticipate that we will require a minimum of approximately $4,000,000 to proceed with our plan of operations for the twelve month period ended December 31, 2012. We have no current material commitments for capital expenditures.

We do not currently have sufficient capital resources to fund our plan of operations for the next twelve months, as described in Item 4.B of this Form 20-F. We plan to raise additional capital through the sale of debt or equity securities or through other forms of financing in order to raise the funds necessary to pursue our plan of operations. We currently do not have any arrangements in place for the completion of any financings and there is no assurance that we will be successful in completing any financings. There can be no assurance that additional financing will be available when needed or, if available, on commercially reasonable terms. If we are not able to obtain additional financing on a timely basis, we may not be able to pursue our plan of operations or meet our obligations as they come due, and may be forced to scale down, or perhaps even cease, business operations.

Cash on hand is currently our only source of liquidity. We do not have any lending arrangements in place with banking or financial institutions and we do not know whether we will be able to secure such funding arrangements in the near future.

Going Concern

Due to the uncertainty of our ability to meet our current operating and capital expenses, in the auditor’s report on our annual financial statements for the year ended December 31, 2011, our independent auditors included an explanatory paragraph on their report in respect of there being substantial doubt about our ability to continue as a going concern.

Significant Accounting Policies

Critical Accounting Estimates, assumptions and judgments

The preparation of consolidated financial requires the use of estimates, assumptions and judgment that in some cases relate to matters that are inherently uncertain, and which affect the amounts reported in the consolidated financial statements and accompanying notes. Changes to estimates and assumptions may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. Actual results could also differ from those estimates under different assumptions and conditions. Information about critical judgments in applying accounting policies that have the most significant risk of causing material adjustment to the amounts reported in these financial statements are discussed below:

Share Based Payments

The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. Estimating fair value for share-based payment transactions requires determining the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determining the most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them. The assumptions and models used for estimating the fair value for share-based payment transactions are disclosed in Note 8d to the annual financial statements contained herein).

Income Taxes

The Company recognizes liabilities and contingencies for anticipated tax audit issues based on the Company’s current understanding of the tax law. For matters where it is probable that an adjustment will be made, the Company records its best estimate of the tax liability including the related interest and penalties in the current tax provision. Management believes they have adequately provided for the probable outcome of these matters; however, the final outcome may result in a materially different outcome than the amount included in the tax liabilities.

In addition, the Company recognizes deferred tax assets relating to tax losses carried forward to the extent there are sufficient taxable temporary differences relating to the same taxation authority and the same taxable entity against which the unused tax losses can be utilized. However, utilization of the tax losses also depends on the ability of the taxable entity to satisfy certain tests at the time the losses are recouped.

Fair Value of TrichoScience Transaction

Significant judgment is required in determining the fair value of the consideration granted during a Reverse Takeover transaction. Estimating the fair value of the shares granted and the fair value released by participating shareholders requires determining the most appropriate valuation model. The assumptions used are disclosed in Note 5 to the annual financial statements contained herein.

Recent Accounting Pronouncements in Canada

Certain pronouncements were issued by the IASB or the IFRS Interpretations Committee that are mandatory for accounting periods beginning after January 1, 2011 or later periods.

The following new standards, amendments and interpretations, which have not been early adopted in these consolidated financial statements, will or may have an effect on the Company’s future results and financial position:

IFRS 9 Financial Instruments

IFRS 9 Financial Instruments is part of the IASB's wider project to replace IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 retains but simplifies the mixed measurement model and establishes two primary measurement categories for financial assets: amortized cost and fair value. The basis of classification depends on the entity's business model and the contractual cash flow characteristics of the financial asset. The standard is effective for annual periods beginning on or after January 1, 2013. The Company is in the process of evaluating the impact of the new standard.

IFRS 10 Consolidated Financial Statements

IFRS 10 builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within the consolidated financial statements of the parent company. The standard provides additional guidance to assist in the determination of control where this is difficult to assess. The Company is yet to assess the full impact of IFRS 10 and intends to adopt the standard no later than the accounting period beginning on January 1, 2013.

IFRS 13 Fair Value Measurement

IFRS 13 aims to improve consistency and reduce complexity by providing a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across IFRSs. The requirements, which are largely aligned between IFRSs and US GAAP, do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is already required or permitted by other standards within IFRSs or US GAAP. The Company is yet to assess the full impact of IFRS 13 and intends to adopt the standard no later than the accounting period beginning on January 1, 2013.

The following new standards, amendments and interpretations, which have not been early adopted in these consolidated financial statements, will not have an effect on the Company’s future results and financial position:

IFRS 1: Severe Hyperinflation (Effective for periods beginning on or after July 1, 2011)
IAS 12: Deferred Tax: Recovery of Underlying Assets (Amendments to IAS 12 (Effective for periods beginning on or after January 1, 2012)
Amendments to IFRS 9: Financial Instruments (Effective for periods beginning on or after January 1, 2013)

C. Research and Development, Patents and Licenses etc.

We incurred research and development costs of $381,759 and $182,486 in 2011 and 2010, respectively and clinical development costs of $637,649 and $367,763 in 2011 and 2010, respectively. Our research currently focuses on the development of our non-surgical hair cell replication technology. In 2008, we were granted a patent for our technology in each of Australia and the European Union. Patents in other global jurisdictions, including Canada, Japan and the United States, have been applied for and are pending. We will continue to conduct our research and development activities through contracts with the University of British Columbia, Tricholog GmbH, Pharmalog Institute fur klniische Forschung GmbH, and other research institutions and commercial entities when needed.

D. Trend Information

As we have just implemented a new business plan, we do not currently know of any trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on our net sales or revenue, income from continuing operations, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial condition.

E. 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 are material to investors.

F. Contractual Obligations

We have no contractual obligations as of December 31, 2011 or as of the date of this Form 20-F.

G. Safe Harbor

Not applicable.

ITEM 6. Directors, Senior Management and Employees

A. Directors and Senior Management

There are no family relationships between any of the directors, senior management or employees. We have no arrangement or understanding with any major shareholders or other persons pursuant to which any of our directors or officers was selected as a director or officer. The following table sets out information regarding our directors and senior management, and any employees upon whose work our company is dependent.

Name and Age	Present Position with our Company	Age	Date of Commencement with our Company
David Hall	Chief Executive Officer, President and Director	58	December 22, 2010
Tom Kordyback	Chief Financial Officer	60	August 22, 2011
Dr. Rolf Hoffmann	Chief Medical Officer and Director, TrichoScience Founder	49	December 22, 2010
Dr. Kevin McElwee	Chief Scientific Officer, TrichoScience Founder	41	December 22, 2010

Name and Age	Present Position with our Company	Age	Date of Commencement with our Company
Peter Jensen ⁽¹⁾	Chairman of the Board and Director	58	December 22, 2010
John Challis ⁽¹⁾	Director	65	March 11, 2011
Peter Lewis ⁽¹⁾	Director	56	May 27, 2011
Darrell Panich	VP Clinical Affairs	40	March 15, 2010
Gemma Bayley	VP Finance, Secretary and Treasurer	33	March 11, 2011

⁽¹⁾ Member of the audit committee.

David Hall – Chief Executive Officer, President and Director

Mr. Hall has almost two decades of experience in the life sciences industry. From 1994 through 2008, he served in roles as Chief Financial Officer, Chief Compliance Officer and Senior Vice President of Government & Community Relations for Angiotech Pharmaceuticals Inc. He also acted as the Corporate Secretary and Treasurer of Angiotech. Mr. Hall is highly committed to governmental policy issues related to the biotech industry. He is a past Chairman of Life Sciences BC and currently serves as a director of Advantage BC. He has served as the Chairman of the Biotech Industry Advisory Committee to the BC Competition Council and as a member of the BC Task Force on PharmaCare. Mr. Hall is also a member of the University of British Columbia’s Tech Equity Investment Committee and is a director and Chairman of the Audit Committee of GLG Lifetech Corporation.

Tom Kordyback, CA – Chief Financial Officer

Mr. Kordyback has over 25 years of experience in corporate finance and management for emerging growth companies. He has held senior financial positions with Glenayre Electronics Inc. and Telelink Communications Inc. In 1995, he joined Creo Inc. as their Chief Financial Officer where he oversaw private financings totaling more than $80 million and led the company’s Initial Public Offering on the NASDAQ stock exchange for $90 million. He remained at Creo until 2000. Mr. Kordyback also served as a director and member of the Audit, Compensation and Merger and Acquisitions Committees for Extreme CCTV Inc., a developer and manufacturer of state-of-the-art surveillance systems listed on the TSX. In 2008, the company was sold to Bosch Security Systems, Inc. for CDN $93 million. Mr. Kordyback currently serves as director of Silver Sun Resources Corp., a public Canadian-based resource company.

Prof. Rolf Hoffmann, MD – Chief Medical Officer and Director

Dr. Hoffmann is a European-based clinical researcher who has spent decades researching the fields of pattern hair loss, alopecia areata, endocrinology of the hair follicle and hair follicle morphogenesis. Together with Dr. McElwee, he is the applicant of a landmark patent on the use of hair follicle cup cells and their use in hair diseases. He is working clinically in his private practice, as a teaching professor in the Department of Dermatology for Marburg University, as well as a researcher on histopathogically on hair diseases, where he has published chapters in text books. Dr. Hoffmann has participated in dozens of clinical hair studies and consulted for a variety of large companies on hair matters. He is the inventor of TrichoScan®, a computerized technique to measure hair growth. Since then, he has run a successful privately owned company to market the device for dermatologists and to offer it as a service for clinical trials.

Dr. Kevin McElwee, PhD – Chief Scientific Officer

Dr. McElwee is an Associate Professor in the Department of Dermatology and Skin Health at the University of British Columbia, and Director of the Hair Research Laboratory in the Vancouver Coastal Health Research Institute at Vancouver General Hospital (VGH). His research is funded by competitive grants awarded by multiple organizations including the Canadian Institutes for Health Research (the equivalent of the National Institutes for Health in the USA). Dr. McElwee is one of only a small group of research scientists worldwide who studies hair biology and associated diseases. He has worked as a hair research scientist for 12 years and has published over 70 medical journal articles, research abstracts and academic book chapters on hair loss research. Dr. McElwee received his Bachelor of Science degree from the University of Aberdeen, Scotland and his PhD from the University of Dundee, Scotland. Postdoctoral training included three years at the Jackson Laboratory in Maine and four years at the University of Marburg, Germany, studying various hair loss diseases.

Peter Jensen – Chairman of the Board and Director

Mr. Jensen holds a Bachelor of Science and two Law degrees from McGill University. Prior to his law degrees, he was engaged in diabetes research and medical clinic management. In 1981, he commenced the practice of law in the corporate and securities fields in British Columbia. Mr. Jensen has a wide range of legal counseling experience internationally and has a depth of experience in trans-border transactions. Mr. Jensen has been and is a director of a number of private and publicly traded companies and has assisted in the raising of finance for these companies in Canada, the United States, Europe and Asia.

John Challis – Director

Dr. Challis is the past President and CEO of the Michael Smith Foundation for Health Research, British Columbia’s health research funding organization. Dr. Challis received his PhD from the University of Cambridge and began his career as a research scientist at the University of Oxford. In 1976, he came to Canada as a faculty member at McGill University and joined the faculty at the University of Western Ontario two years later. Dr. Challis served as founding Scientific Director of the Lawson Research Institute at St. Joseph’s Health Centre and as the Centre’s vice-president (research). In 1995, he joined the University of Toronto as Professor and Chair of the Department of Physiology and in 2001 he was appointed the founding Scientific Director of the Canadian Institute of Health Research, Institute of Human Development, Child and Youth Health. Dr. Challis served as Vice-President, Research and Associate Provost at the University of Toronto between 2003 and 2007.

In 2007, Dr. Challis was awarded the McLaughlin Medal from the Royal Society of Canada for important research of sustained excellence in medical science. In March 2009, Dr. Challis received the President’s Distinguished Scientist Award from the Society for Gynaecologic Investigation (SGI). Currently, he holds the rank of University Professor Emeritus, University of Toronto, Departments of Physiology, Medicine and Obstetrics and Gynaecology. Dr. Challis is an internationally-recognized researcher in the fields of physiology, obstetrics and gynaecology. He is a Fellow of the Royal Society of Canada, Fellow of the Royal College of Obstetricians and Gynecologists, and Fellow of the Canadian Academy of Health Sciences. He has published more than 500 scientific papers and articles, trained more than 70 graduate students and postdoctoral fellows and has served as President of several professional associations in his field of research.

Peter Lewis, CA – Director

Mr. Lewis is a partner with Lewis and Company, a firm specializing in taxation law since 1993. His areas of expertise include tax planning, acquisitions and divestitures, reorganizations and estate planning. He is a sought after educator, having taught and presented taxation courses at the Institute of Chartered Accountants of British Columbia and the Canadian Tax Foundation.

Darrell Panich, MSc, PMP, CPM - Vice President, Clinical Affairs

Mr. Panich is an experienced clinical trial management specialist. He has managed multinational clinical research studies in more than 15 different countries for over 20 different pharmaceutical and biotechnology companies. He obtained his Master of Science degree from the University of Alberta while conducting clinical research in neuroscience. Mr. Panich has obtained certifications in project management from the Project Management Institute (Project Management Professional; PMP) and Project Management Leadership Group (Certified Project Manager; CPM).

Gemma Bayley, CA - VP Finance and Secretary

Ms. Bayley is a Chartered Accountant and holds a degree in Economics from the University of British Columbia. Ms. Bayley has spent several years in public practice specializing in the brokerage industry, as well as audit and advisory work for both private and public clients. She recently held a senior management finance role with the Vancouver Organizing Committee for the 2010 Olympic and Paralympic Winter Games, and has a wide range of experience in accounting and finance.

B. Compensation

The following table sets out the compensation provided to our directors and senior management for performance of their duties during the fiscal year ended December 31, 2011:

SUMMARY COMPENSATION TABLE
Name and principal position	Year	Salary ($)	Share- based awards ($)	Option- based awards ⁽⁷⁾ ($)	Non-equity incentive compensation plan compensation ($)		Pension value ($)	All other Compen- sation ($)	Total Compen- sation ($)
Name and principal position	Year	Salary ($)	Share- based awards ($)	Option- based awards ⁽⁷⁾ ($)	Annual incentive plans	Long- term incentive plans	Pension value ($)	All other Compen- sation ($)	Total Compen- sation ($)
David Hall CEO, President and Director	2011	360,000	178,045	111,945	N/A	N/A	N/A	N/A	649,990
Tom Kordyback ⁽¹⁾ Chief Financial Officer	2011	N/A	N/A	10,987	N/A	N/A	N/A	N/A	10,987
Dr. Rolf Hoffmann Chief Medical Officer and Director	2011	81,473	N/A	40,865	N/A	N/A	N/A	N/A	122,338
Dr. Kevin McElwee Chief Scientific Officer Founder of TrichoScience	2011	60,000	N/A	40,865	N/A	N/A	N/A	N/A	100,865
Peter Jensen ⁽²⁾ Chairmen and Director	2011	N/A	N/A	18,072	N/A	N/A	N/A	N/A	18,072
John Challis ⁽³⁾ Director	2011	N/A	N/A	44,778	N/A	N/A	N/A	N/A	44,778
Peter Lewis ⁽⁴⁾ Director	2011	N/A	N/A	44,778	N/A	N/A	N/A	N/A	44,778
Darrell Panich VP, Clinical Affairs	2011	125,000	N/A	47,367	N/A	N/A	N/A	N/A	172,367
Gemma Bayley ⁽⁵⁾ VP, Finance and Secretary	2011	60,400	N/A	44,778	N/A	N/A	N/A	N/A	105,178
Brent Petterson ⁽⁶⁾ Chief Financial Officer and Secretary	2011	N/A	N/A	49,315	N/A	N/A	N/A	N/A	49,315

⁽¹⁾	Mr. Kordyback was appointed CFO of our company on August 22, 2011. This compensation relates to founder’s options granted to Mr. Kordyback by a founding shareholder in fiscal 2010.
⁽²⁾	Mr. Jensen was paid $22,250 in director’s fees by our company for the fiscal year ended December 31, 2011. $12,169 of compensation relates to founder’s options granted to Mr. Jensen by a founding shareholder in fiscal 2010.
⁽³⁾	Mr. Challis was appointed a director of our company on March 11, 2011. Mr. Challis was paid $12,959 in director’s fees by our company for the fiscal year ended December 31, 2011.
⁽⁴⁾	Mr. Lewis was appointed a director of our company on May 27, 2011. He was paid $12,000 in director’s fees by our company for the fiscal year ended December 31, 2011.
⁽⁵⁾	Ms. Bayley was appointed secretary of our company on May 27, 2011
⁽⁶⁾	Mr. Petterson served as a director of our company during the fiscal year ended December 31, 2010. He resigned as a director on December 22, 2010. He resigned as CFO and secretary on August 22, 2011. MBP Management Ltd., a company controlled by Mr. Petterson, received $18,000 from our company during the fiscal year ended December 31, 2011.
⁽⁷⁾	Details of options granted during 2011 are included in the table below under the heading “Stock Option Plan”.

Pension, Retirement or Similar Benefits

We do not provide pension, retirement or similar benefits to directors and executive officers. No funds were set aside or accrued by our company during the fiscal year ended December 31, 2011 to provide pension, retirement or similar benefits to our directors or officers pursuant to any existing plan provided or contributed to by us or our subsidiaries.

C. Board Practices

Our directors are re-elected at the annual general meeting of our shareholders and our officers are re-appointed by our board of directors at a directors’ meeting following the annual general meeting. Each of our current directors and officers will hold their respective office until their successor is elected or appointed, unless such office is earlier vacated under any of the relevant provisions of our by-laws or the Business Corporations Act (British Columbia).

The following sets out terms of the consulting agreement between our company and David Hall. Mr. Hall is the only director of our company who is entitled to receive benefits upon termination of employment, as described below.

Consulting Agreement: David Hall

Pursuant to an employment agreement effective as of January 1, 2011 between David Hall, our company and TrichoScience, Mr. Hall serves as President and Chief Executive Officer of our company and TrichoScience for a base salary of $30,000 per month. The initial term of this agreement is for five years and is automatically renewable for subsequent two year terms. Under the agreement, Mr. Hall will be eligible to participate in a bonus plan as and when established by our company, which currently is anticipated to provide for bonuses based on a target bonus of 100 percent of the base salary earned by Mr. Hall during each fiscal year in accordance with milestones to be established by our board of directors. Mr. Hall may also be eligible to receive additional stock option grants or awards under other equity based incentive plans from time to time. In the case of general grants of options or awards to executives, Mr. Hall shall receive not less than 10% of such general grant unless our board presents material reasons for lesser or non-participation. If, within 24 months of a change of control of our company, Mr. Hall’s employment is terminated for any reason other than for just cause, we will pay Mr. Hall: any unpaid base salary earned but unpaid; a lump sum amount as severance compensation equal to 36 months of base salary and an additional 2 months of base salary for each additional full year of employment completed after the first year of Mr. Hall’s employment, up to a combined maximum of 48 months’ base salary; a lump sum amount as compensation for loss of any benefits made available to Mr. Hall, including any benefit coverage under any group, health, dental, life or disability insurance plan up to a total amount of $100,000 plus an additional $2,000 for each additional full year of employment complete after the first year of Mr. Hall’s employment, to a combined maximum of $124,000; the balance of any payments due under any bonus plan; and a further lump sum payment equal to two times the greater of: (i) the average of the payments made to Mr. Hall under the bonus plan in each of the two immediately preceding fiscal years; and (ii) the amount of Mr. Hall’s target bonus under the bonus plan for the fiscal year in which Mr. Hall’s employment is terminated.

Audit Committee

Our audit committee is comprised of Peter Lewis, John Challis and Peter Jensen. The audit committee reviews and approves the scope of the audit procedures employed by our independent auditors, reviews the results of the auditor’s examination, the scope of audits, the auditor’s opinion on the adequacy of internal controls and quality of financial reporting and our accounting and reporting principles, policies and practices, as well as our accounting, financial and operating controls. The audit committee also reports to the board of directors with respect to such matters and recommends the selection of independent auditors. Before financial statements that are to be submitted to the shareholders at an annual general meeting are considered by the board of directors, such financial statements are submitted to the audit committee for review, following which the report of the audit committee on the financial statements is submitted to the board of directors.

- 27 -

Remuneration Committee

We do not have a standing remuneration committee but our entire board of director’s acts as our compensation committee. We do not believe it is necessary to have a standing remuneration committee because we believe that the functions of such a committee can be adequately performed by our board of directors.

D. Employees

As of December 31, 2011, we had four full time employees and five contractors, the majority of which are located in Vancouver, British Columbia. These employees and contractors have expertise in biotechnology management, clinical trials, financial management and communications.

E. Share Ownership

Our directors, senior management and key employees beneficially own, directly or indirectly, the number of shares set out in the table below:

Name and Office Held	Number of Common Shares ⁽¹⁾	Percentage of Common Shares ⁽²⁾
David Hall Chief Executive Officer, President and Director	2,400,000 ⁽³⁾	5.3%
Tom Kordyback Chief Financial Officer	100,993	*
Dr. Rolf Hoffmann Chief Medical Officer and Director	4,895,689	10.9%
Dr. Kevin McElwee Chief Scientific Officer	4,491,716	10.0%
Peter Jensen Chairmen and Director	500,000	1.1%
John Challis Director	-	-
Peter Lewis Director	40,000	*
Darrell Panich VP, Clinical Affairs	-	-
Gemma Bayley VP, Finance and Secretary	-	-
Brent Peterson Chief Financial Officer and Secretary	100,000	*

* Less than 1%.

⁽¹⁾	Does not include options to acquire common shares of our company held by the persons set forth in the table. For a description of options held by the persons set forth in the table above, see below under the heading “Stock Option Plan”.
⁽²⁾	Based on 45,025,054 common shares issued and outstanding as of April 24, 2012.
⁽³⁾	Does not include 1,000,000 common shares held by Mr. Hall’s wife over which Mr. Hall does not exercise control or direction.

Stock Option Plan

On December 22, 2010, our board of directors approved the adoption of the 2010 Stock Option Plan, which was ratified and approved by our shareholders on January 5, 2011. The 2010 Stock Option Plan provides for the grant of incentive stock options to purchase our common shares to our directors, officers, employees and consultants. The Plan is administered by our board of directors. The maximum number of our common shares which may be reserved and set aside for issuance under the stock option plan is 10% of the issued and outstanding common shares of our company’s stock on the date of issue. Each option, upon its exercise, entitles the grantee to one common share. The exercise price of common shares subject to an option will be determined by the board of directors at the time of grant. Stock options may be granted under our stock option plan for an exercise period of up to ten years from the date of grant of the option or such lesser periods as may be determined by our board of directors.

The following table sets forth the amount and terms of options to acquire common shares of our company we have granted to our directors, senior management and key employees:

Name and Office Held	Number of Options	Date of Grant	Exercise Price	Expiry Date
David Hall Chief Executive Officer, President and Director	250,000	March 11, 2011	US$1.00	March 11, 2018
Tom Kordyback Chief Financial Officer	325,000	February 9, 2010	US$1.00	March 31, 2016
Dr. Rolf Hoffmann Chief Medical Officer and Director	450,000	December 22, 2010	US$0.50	July 13, 2017
Dr. Kevin McElwee Chief Scientific Officer	450,000	December 22, 2010	US$0.50	July 13, 2017
Peter Jensen Chairmen and Director	235,000	July 14, 2010	US$1.00	July 13, 2017
Peter Jensen Chairmen and Director	65,000	December 22, 2010	US$0.50	July 13, 2017
John Challis Director	100,000	March 11, 2011	US$1.00	March 11, 2018
Peter Lewis Director	100,000	March 11, 2011	US$1.00	March 11, 2018
Darrell Panich VP, Clinical Affairs	50,000	January 22, 2010	US$1.00	February 28, 2017
Darrell Panich VP, Clinical Affairs	100,000	March 11, 2011	US$1.00	March 11, 2018
Gemma Bayley VP, Finance and Secretary	100,000	March 11, 2011	US$1.00	March 11, 2018
Brent Peterson Chief Financial Officer and Secretary	150,000	March 11, 2011	US$1.00	March 11, 2018

ITEM 7. Major Shareholders and Related Party Transactions

A. Major Shareholders

The following table sets forth persons known to us to be the beneficial owner of more than five percent (5%) of each class of our shares issued and outstanding as of April 24, 2012. All of these persons acquired their shares of our company in connection with the closing of the TrichoScience Agreement and the 583885 Agreement. Prior to that time, we had no shareholders who were beneficial owners of more than five percent (5%) of our outstanding shares:

Name	Number of Common Shares ⁽¹⁾	Percentage of Common Shares ⁽²⁾
Dr. Rolf Hoffmann	4,895,689	10.9%
Dr. Kevin McElwee	4,491,716	10.0%
Dr. Jerry Shapiro	4,241,716	9.4%
Matthew Wayrynen	4,087,743 ⁽³⁾	9.1%
David Hall	2,400,000 ⁽⁴⁾	5.3%

⁽¹⁾

Does not include options to acquire common shares of our company held by the persons set forth in the table.

⁽²⁾

Based on 45,025,054 common shares issued and outstanding as of April 24, 2012. Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Except as otherwise indicated, we believe that the beneficial owners of the common stock listed above, based on information furnished by such owners, have sole investment and voting power with respect to such shares, subject to community property laws where applicable.

⁽³⁾	Does not include 1,009,932 common shares held by a company that Mr. Wayrynen serves as a director.
⁽⁴⁾	Does not include 1,000,000 common shares held by Mr. Hall’s wife over which Mr. Hall does not exercise control or direction.

The voting rights of our major shareholders do not differ from the voting rights of holders of our shares who are not major shareholders. Each of the above listed securities entitles the holder to one vote at our company’s shareholder meetings.

The following table sets forth the number of our issued and outstanding common shares that are held by record holders in the United States. We have no Class A preference shares outstanding:

Class	Number of Shareholders	Total Shares Held
Common Shares	16	1,574,456
Percentage of Common Shares	0.6%	3.5% ⁽¹⁾

⁽¹⁾

Based on 45,025,054 common shares issued and outstanding as of April 24, 2012.

To our knowledge we are not directly or indirectly owned or controlled by another company, a foreign government or any other natural or legal person, severally or jointly.

The closing of the TrichoScience Agreement and the 583885 Agreement resulted in a change of control of our company. To our knowledge, there are no other arrangements the operation of which may, at a subsequent date, result in a change in the control of our company.

B. Related Party Transactions

The following sets forth all material transactions and loans from January 1, 2011 to the current date between our company and: (a) enterprises that directly or indirectly through one or more intermediaries, control or are controlled by, or are under common control with, our company; (b) associates; (c) individuals owning, directly or indirectly, an interest in the voting power of our company that gives them significant influence over our company and close members of any such individuals’ families; (d) key management personnel of our company, including directors and senior management of our company and close members of such individuals’ families; and (e) enterprises in which a substantial interest in the voting power is owned, directly or indirectly, by any person described in (c) or (d) or over which such a person is able to exercise significant influence. For the purposes of this section, shareholders beneficially owning a 10% interest in the voting power of our company are presumed to have a significant influence:

Related party balances

The following amounts due to related parties are included in trade payables and accrued liabilities:

		December 31, 2011		December 31, 2010
Companies controlled by directors of the Company	$	10,000	$	33,856
Directors or officers of the Company		9,596		43,080
	$	19,596	$	76,936

These amounts are unsecured, non-interest bearing and have no fixed terms of repayment.

As a result of a licence and assignment agreement for clinical trial results relating to the Company’s non-surgical hair cell replication technology the Company is committed to pay a company controlled by a director of the Company $101,250 (75,000€). The Company has been assigned the rights to the clinical trial results.

Related party transactions

The Company incurred the following transactions with companies that are controlled by directors and/or officers of the Company. The transactions were measured at the exchange amount which approximates fair value, being the amount established and agreed to by the parties.

		December 31, 2011		December 31, 2010
Research and development consulting fees	$	135,044	$	144,100
Clinical trial costs		103,563		-
Administrative consulting fees		45,750		116,475
Rent		9,000		15,000
Legal fees		6,621		39,326
	$	299,977	$	314,901

Key management compensation

Key management personnel are persons responsible for planning, directing and controlling the activities of an entity, and include executive directors, the Chief Executive Officer and the Chief Financial Officer.

		December 31, 2011		December 31, 2010
Short-term employee benefits – salaries and wages	$	425,209	$	30,000
Stock-based compensation		313,665		432,395
	$	738,874	$	462,395

C. Interests of Experts and Counsel

Not applicable.

ITEM 8. Financial Information

A. Financial Statements and Other Financial Information

Our financial statements are stated in Canadian dollars and are prepared in accordance with IFRS as issued by the IASB. In this Form 20-F, unless otherwise specified, all dollar amounts are expressed in Canadian dollars. Financial statements included with this annual report are listed below:

1. Audited Annual Financial Statements as at December 31, 2011 and 2010:

	Independent Auditor’s Report of BDO Canada LLP, dated April 20, 2012

	Consolidated Statement of Financial Position as at December 31, 2011, 2010 and January 1, 2010;

	Consolidated Statements of Comprehensive Loss for the years ended December 31, 2011 and 2010;

	Consolidated Statements of Changes in Equity for the years ended December 31, 2011 and 2010

	Consolidated Statements of Cash Flows for the years ended December 31, 2011 and 2010; and

	Notes to the Consolidated Financial Statements.

The audited consolidated financial statements for the years ended December 31, 2011 and 2010 can be found under “Item 17. Financial Statements”.

Legal Proceedings

There are no pending legal proceedings to which we are a party or of which any of our property is the subject. There are no legal proceedings to which any director, officer or affiliate of our company, or any associate of any such director, officer or affiliate of our company, is a party or has a material interest adverse to us.

Dividend Distributions

Holders of our common shares are entitled to receive such dividends as may be declared from time to time by our board, in its discretion, out of funds legally available for that purpose. We intend to retain future earnings, if any, for use in the operation and expansion of our business and do not intend to pay any cash dividends in the foreseeable future.

B. Significant Changes

The following is a summary of significant changes in our financial affairs since December 31, 2011:

On January 3, 2012, we granted 100,000 stock options to consultants of our company, with each option exercisable into one common share for US$2.35 per share until January 3, 2019. These options were issued to non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933, as amended.

On April 18, 2012, we granted 790,000 stock options to officers, employees and consultants of our company, with each option exercisable into one common share for US$1.50 per share until April 18, 2019. 690,000 of these options were issued to non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933, as amended. 100,000 of these options were issued to one U.S. person, who is an accredited investor (as that term is defined in Rule 501 of Regulation D, promulgated by the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, and in issuing these options to this person we relied on the registration exemption provided for in Rule 506 of Regulation D and/or Section 4(2) of the Securities Act of 1933, as amended.

On February 29, 2012, we completed a private placement of 66,000 units at a price of US$1.50 per unit for gross proceeds of US$99,000. Each unit issued consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase an additional common share at US$2.50 per share for a period of 24 months from the closing of the Financing. All of these shares were issued to non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933, as amended.

On March 29, 2012, we completed a private placement of 876,042 units at a price of US$1.50 per unit for gross proceeds of US$1,314,063. Each unit issued consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase an additional common share at US$2.50 per share for a period of 24 months from the closing of the Financing. We issued 694,043 units to non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933, as amended. We issued 181,999 units to U.S. persons, who are accredited investors (as that term is defined in Rule 501 of Regulation D, promulgated by the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, and in issuing these shares to this investor we relied on the registration exemption provided for in Rule 506 of Regulation D and/or Section 4(2) of the Securities Act of 1933, as amended.

On April 18, 2012, we completed a private placement of 502,667 units at a price of US$1.50 per unit for gross proceeds of US$754,000. Each unit issued consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase an additional common share at US$2.50 per share for a period of 24 months from the closing of the Financing. A finder’s fee of $36,000 was issued in connection with the Financing.We issued 416,667 units to non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933, as amended. We issued 86,000 units to U.S. persons, who are accredited investors (as that term is defined in Rule 501 of Regulation D, promulgated by the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, and in issuing these shares to this investor we relied on the registration exemption provided for in Rule 506 of Regulation D and/or Section 4(2) of the Securities Act of 1933, as amended.

On April 20, 2012, we completed a private placement of 430,033 units at a price of US$1.50 per unit for gross proceeds of US$645,050. Each unit issued consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase an additional common share at US$2.50 per share for a period of 24 months from the closing of the Financing. We issued 70,000 units to non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933, as amended. We issued 360,033 units to U.S. persons, who are accredited investors (as that term is defined in Rule 501 of Regulation D, promulgated by the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, and in issuing these shares to this investor we relied on the registration exemption provided for in Rule 506 of Regulation D and/or Section 4(2) of the Securities Act of 1933, as amended.

As described above, in connection with the acquisition of TrichoScience, we also acquired all of the issued and outstanding common shares of 583885 in exchange for the issuance of 4,400,000 common shares of our company. 3,400,000 of such common shares controlled by our Chief Executive Officer were deposited with an escrow agent pursuant to the terms of an escrow agreement, to be released upon satisfaction of certain performance conditions as set out in the escrow agreement. During the year ended December 31, 2011, the performance conditions with respect to the release of 350,000 shares (December 31, 2010: 850,000) had been achieved. As of the date of this annual report, another performance milestone under the escrow agreement, being the completion of an aggregate of $4,000,000 in financing since December 22, 2010, has been completed. As a result, an additional 500,000 shares have been released from escrow.

ITEM 9. The Offer and Listing

A. Offer and Listing Details

Price History

Since April 16, 2004, our common shares, which are shares without par value, have been quoted on the OTC Bulletin Board, currently under the symbol “REPCF”. The following table sets forth the annual high and low market prices for our common shares on the OTC Bulletin Board for the five most recent full fiscal years:

OTC Bulletin Board
Annual Highs and Lows	High (U.S.$)	Low (U.S.$)
2007	0.23	0.02
2008 ⁽¹⁾	0.15	0.001
2009	2.00	0.10
2010	4.00	0.17
2011	3.05	1.75

⁽¹⁾

On November 10, 2008, our issued and unissued shares of common stock were consolidated on the basis of one (1) share for every (30) shares of common stock and our name was changed to Newcastle Resources Ltd. The reverse split and name change were effected with the OTC Bulletin Board on November 28, 2008 at which time our trading symbol was changed to “NCSLF”.

The high and low market prices for our common shares for each full fiscal quarter for the two most recent full fiscal years on the OTC Bulletin Board were as follows:

OTC Bulletin Board
Quarterly Highs and Lows	High (U.S.$)	Low (U.S.$)
2010
First Quarter	0.13	0.02
Second Quarter	1.45	0.17
Third Quarter	0.28	0.20
Fourth Quarter	4.00	0.25
2011
First Quarter	2.50	1.75
Second Quarter	3.05	2.20
Third Quarter	2.90	1.95
Fourth Quarter	2.70	2.25
2012
First Quarter	2.55	1.60

The high and low market prices of our common shares for each of the most recent six months on the OTC Bulletin Board were as follows:

OTC Bulletin Board
Monthly Highs and Lows	High (U.S.$)	Low (U.S.$)
October 2011	2.70	2.25
November 2011	2.60	2.35
December 2011	2.55	2.25
January 2012	2.40	1.60
February 2012	2.60	2.10
March 2012	2.35	1.90

The trading price and volume of our company’s common shares has been and may continue to be subject to wide fluctuations. The stock market has generally experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies with little or no current business operations. Because our common shares are only sporadically traded on the OTC Bulletin Board, and are not traded in any other markets, shareholders may find it difficult to liquidate their shares, or purchase new shares, at certain times.

All of our common shares are issued in registered form. The transfer of our common shares is managed by our transfer agent, Computershare Investor Services Inc., 3rd Floor – 510 Burrard Street, Vancouver, British Columbia, V6C 3B9 (Telephone: 604.661.0271; Facsimile: 604.661.9549) .

B. Plan of Distribution

Not applicable.

C. Markets

Our common shares are quoted on the OTC Bulletin Board (as they have been quoted since April 16, 2004). Our symbol is “REPCF”. Our shares are not currently listed for trading on any other market or quotation system.

D. Selling Shareholders

Not applicable.

E. Dilution

Not applicable.

F. Expenses of the Issue

Not applicable.

ITEM 10. Additional Information

A. Share Capital

Not applicable.

B. Memorandum and Articles of Association

We have been continued under the laws of the Province of British Columbia, Canada and have been assigned the number C0913693.

Our Articles do not contain a description of our objects and purposes.

Our Articles do not restrict a director’s power to vote on a proposal, arrangement or contract in which the director is materially interested, vote compensation to themselves or any other members of their body in the absence of an independent quorum or exercise borrowing powers. There is no mandatory retirement age for our directors and our directors are not required to own securities of our company in order to serve as directors.

Our authorized capital consists of an unlimited number of common shares without par value and an unlimited number of Class A preference shares without par value. Our Class A preference shares may be issued in one or more series and our directors may fix the number of shares which is to comprise each series and designate the rights, privileges, restrictions and conditions attaching to each series. There are no Class A preference shares issued and outstanding.

Holders of our common shares are entitled to vote at all meetings of shareholders, except meetings at which only holders of a specified class of shares are entitled to vote, receive any dividend declared by us and, subject to the rights, privileges, restrictions and conditions attaching to any other class of shares, receive the remaining property of our company upon dissolution.

The provisions in our Articles attaching to our common shares and Class A preference shares may be altered, amended, repealed, suspended or changed by the affirmative vote of the holders of not less than two-thirds of the common shares and two-thirds of the Class A preference shares, respectively, present in person or by proxy at any such meeting of holders.

Our Articles provide for directors to hold office until the expiry of his term (which is stipulated to be immediately before the next election or appointment of directors at an annual general meeting of our shareholders) or until his successor is elected or appointed, unless his office is earlier vacated in accordance with our Articles or with the provisions of the Business Corporations Act (British Columbia) . A director appointed or elected to fill a vacancy on the board of directors holds office for the unexpired term of his predecessor.

An annual meeting of shareholders must be held at such time in each year that is not later than fifteen months after the last preceding annual meeting and at such place as our board of directors may from time to time determine. The holders of not less than five percent of our issued shares that carry the right to vote at a meeting may requisition our directors to call a meeting of shareholders for the purposes stated in the requisition. The quorum for the transaction of business at any meeting of shareholders is two persons who are entitled to vote at the meeting in person or by proxy. Only persons entitled to vote, our directors, president, secretary, lawyers and auditors, and others who, although not entitled to vote, are otherwise entitled or required to be present, are entitled to be present at a meeting of shareholders, provided that only persons entitled to vote may be counted in the quorum.

Except as provided in the Investment Canada Act , there are no limitations specific to the rights of non-Canadians to hold or vote our common shares under the laws of Canada or British Columbia, or in our charter documents. See the section entitled “Exchange Controls” below for a discussion of the principal features of the Investment Canada Act for non-Canadian residents proposing to acquire our common shares.

Our Articles do not contain provisions that would have an effect of delaying, deferring or preventing a change in control of our company, other than authorizing the issuance by our board of directors of preferred stock in series and limiting the persons who may call special meetings of shareholders. Our Articles do not contain any provisions that would operate only with respect to a merger, acquisition or corporate restructuring of our company.

Our Articles do not contain any provisions governing the ownership threshold above which shareholder ownership must be disclosed.

Our Articles are not significantly different from the requirements of the Business Corporations Act (British Columbia), and the conditions imposed by our Articles governing changes in capital are not more stringent than what is required by the Business Corporations Act (British Columbia).

C. Material Contracts

The material contracts which RepliCel and TrichoScience have entered into during the last two years are set out below. All references to “we”, “us” or “our” in the descriptions of the agreements below refer to TrichoScience, with the exception of the descriptions of the TrichoScience Agreement and the 583885 Agreement:

On October 29, 2010, we entered into the TrichoScience Agreement, which closed effective December 22, 2010. See “Item 4. Information on Newcastle Resources Ltd. – History and Development of Newcastle Resources Ltd.”.

On October 29, 2010, we entered into the 583885 Agreement, which closed effective December 22, 2010. See “Item 4. Information on Newcastle Resources Ltd. – History and Development of Newcastle Resources Ltd.”. Pursuant to an agreement dated September 23, 2009, TrichoScience engaged a German company to conduct Phase I and IIA of a clinical trial at a cost of $180,200 (€120,135) plus expenses. As at December 31, 2011 the remaining contractual commitment was $7,227.

Under an assignment agreement, dated September 17, 2009, TrichoScience was assigned certain rights and obligations under a research agreement with a German company. Under the assignment agreement, the Germany company is obligated to undertake scientific research on behalf of TrichoScience. Under the assignment agreement, TrichoScience is required to pay a total of €23,000 in three instalments. The first instalment of 40 percent is due upon conclusion of work to be carried out by the German company. A further 30 percent of the price is due upon completion of a trial run of results of the research. The remaining 30 percent is due upon submission for national approval in Austria.

In a memorandum of understanding dated January 25, 2010, we and the Agency for Medical Innovation (“AMI”) agreed to create an equal partnership for the development, manufacturing and worldwide distribution of the TrichoScience Stem Cell Implantation & Application System & Device (“ISD”). Under the terms of the MOU, we and AMI agreed to proceed in three phases. In the first phase, AMI will undertake concept development and limit itself to 90 days or 350 billable AMI engineering hours. We will pay AMI €70 per hour in this phase. In the second phase, AMI will undertake research and development. AMI will provide us with a summary of estimated time and costs for second phase work, to be approved by our company. Second phase costs will be divided into internal and external expenses. Internal research and development expenses are estimated at a maximum of €100,000 by AMI and these costs will be shared equally by us and AMI up to this estimate. Any internal costs over the estimate will be borne by AMI. All second phase external costs will be paid by us, plus a ten percent surcharge. All patents will be our property. In the third phase, our company and AMI will enter into a long term agreement for the manufacturing of the ISD. Under this agreement, AMI will become the exclusive manufacturer of the ISD, subject to certain pricing, manufacturing and buyout provisions.

On February 12, 2010, we signed a collaborative research agreement with the University of British Columbia and the Vancouver Coastal Health Authority (together, the “Institutions”). Under the collaborative research agreement, the Institutions agreed to undertake hair cell research and we agreed to pay research costs totaling $472,250. We will gain the rights to any intellectual property arising from the collaborative research agreement. We agreed to make the following payments to the Institutions in installments, as follows: $155,562.50 on execution (paid); $105,562.50 on July 31, 2010 (paid); $105,562.50 on January 31, 2011 (paid); and $105,562.50 on July 31, 2011 (paid).

On September 1, 2011,we entered into a contract with a German consultant to provide services in relation to the clinical trials. The term of the agreement is for one year and will automatically renew on the anniversary date of the agreement. The consultant is to be paid €3,000 per month during the term of the agreement and is to be issued 100,000 stock options to acquire common shares of our company. These options were issued on January 3, 2012. The options vest according to key milestones as outlined in the agreement.

Pursuant to an agreement dated September 30, 2011, we entered into a contract with a private US company to perform professional services related to shareholder acquisition and marketing consulting. In return for these services, we paid US$125,000, and issued 250,000 share purchase warrants to purchase common shares of our company. The warrants will be issued and vest based upon the completion of key milestones. No warrants have been issued and all amounts have been paid as of the date of this annual report.

On September 30, 2011, we entered into a lease agreement for our office premises. The term of the lease is for one year, ending on November 30, 2012. The outstanding commitment at December 31, 2011 was $88,429.

On April 12, 2012, we entered into an arrangement with a private US company to perform professional services related to the dissemination of corporate marketing materials. In return for these services, we have paid US$338,000. There is no formal agreement with respect to this arrangement.

D. Exchange Controls

There are presently no governmental laws, decrees or regulations in Canada which restrict the export or import of capital, or which impose foreign exchange controls or affect the remittance of interest, dividends or other payments to non-resident holders of our common shares. However, any remittances of dividends to shareholders not resident in Canada are subject to withholding tax in Canada. See the section entitled “Taxation” below.

Except as provided in the Investment Canada Act , there are no limitations specific to the rights of non-Canadians to hold or vote our common shares under the laws of Canada or British Columbia or in our charter documents. The following summarizes the principal features of the Investment Canada Act for non-Canadian residents proposing to acquire our common shares.

This summary is of a general nature only and is not intended to be, and should not be construed to be, legal advice to any holder or prospective holder of our common shares, and no opinion or representation to any holder or prospective holder of our common shares is hereby made. Accordingly, holders and prospective holders of our common shares should consult with their own legal advisors with respect to the consequences of purchasing and owning our common shares.

The Investment Canada Act governs the direct or indirect acquisition of control of an existing Canadian business by non-Canadians. Under the Investment Canada Act , non-Canadian persons or entities acquiring “control” (as defined in the Investment Canada Act ) of a corporation carrying on business in Canada are required to either notify, or file an application for review with, Industry Canada, unless a specific exemption, as set out in the Investment Canada Act, applies. Industry Canada may review any transaction which results in the direct or indirect acquisition of control of a Canadian business, where the gross value of corporate assets exceeds certain threshold levels (which are higher for investors from members of the World Trade Organization, including United States residents, or World Trade Organization member-controlled companies) or where the activity of the business is related to Canada’s cultural heritage or national identity. No change of voting control will be deemed to have occurred, for purposes of the Investment Canada Act , if less than one-third of the voting control of a Canadian corporation is acquired by an investor. In addition, the Investment Canada Act permits the Canadian government to review any investment where the responsible Minister has reasonable grounds to believe that an investment by a non-Canadian could be injurious to national security. No financial threshold applies to a national security review. The Minister may deny the investment, ask for undertakings, provide terms or conditions for the investment or, where the investment has already been made, require divestment. Review can occur before or after closing and may apply to corporate reorganizations where there is no change in ultimate control.

If an investment is reviewable under the Investment Canada Act , an application for review in the form prescribed is normally required to be filed with Industry Canada prior to the investment taking place, and the investment may not be implemented until the review has been completed and the Minister responsible for the Investment Canada Act is satisfied that the investment is likely to be of net benefit to Canada. If the Minister is not satisfied that the investment is likely to be of net benefit to Canada, the non-Canadian applicant must not implement the investment, or if the investment has been implemented, may be required to divest itself of control of the Canadian business that is the subject of the investment. The Minister is required to provide reasons for a decision that an investment is not of net benefit to Canada.

Certain transactions relating to our common shares will generally be exempt from the Investment Canada Act , subject to the Minister’s prerogative to conduct a national security review, including:

	(a)	the acquisition of our common shares by a person in the ordinary course of that person’s business as a trader or dealer in securities;

	(b)	the acquisition of control of our company in connection with the realization of security granted for a loan or other financial assistance and not for a purpose related to the provisions of the Investment Canada Act; and

	(c)	the acquisition of control of our company by reason of an amalgamation, merger, consolidation or corporate reorganization following which the ultimate direct or indirect control in fact of our company, through ownership of our common shares, remains unchanged.

E. Taxation

Material Canadian Federal Income Tax Consequences

We consider that the following general summary fairly describes the principal Canadian federal income tax consequences applicable to a holder of our common shares who is a resident of the United States, who is not, will not be and will not be deemed to be, a resident of Canada for purposes of the Income Tax Act (Canada) and any applicable tax treaty and who does not use or hold, and is not deemed to use or hold, his common shares in the capital of our company in connection with carrying on a business in Canada (a “ non-resident holder ”).

This summary is based upon the current provisions of the Income Tax Act , the regulations thereunder (the “ Regulations ”), the current publicly announced administrative and assessing policies of the Canada Revenue Agency and the Canada-United States Tax Convention (1980), as amended (the “ Treaty ”). This summary also takes into account the amendments to the Income Tax Act and the Regulations publicly announced by the Minister of Finance (Canada) prior to the date hereof (the “ Tax Proposals ”) and assumes that all such Tax Proposals will be enacted in their present form. However, no assurances can be given that the Tax Proposals will be enacted in the form proposed, or at all. This summary is not exhaustive of all possible Canadian federal income tax consequences applicable to a holder of our common shares and, except for the foregoing, this summary does not take into account or anticipate any changes in law, whether by legislative, administrative or judicial decision or action, nor does it take into account provincial, territorial or foreign income tax legislation or considerations, which may differ from the Canadian federal income tax consequences described herein.

This summary is of a general nature only and is not intended to be, and should not be construed to be, legal, business or tax advice to any particular holder or prospective holder of our common shares, and no opinion or representation with respect to the tax consequences to any holder or prospective holder of our common shares is made. Accordingly, holders and prospective holders of our common shares should consult their own tax advisors with respect to the income tax consequences of purchasing, owning and disposing of our common shares in their particular circumstances.

Dividends

Dividends paid on our common shares to a non-resident holder will be subject under the Income Tax Act to withholding tax which tax is deducted at source by our company. The withholding tax rate for dividends prescribed by the Income Tax Act is 25% but this rate may be reduced under the provisions of an applicable tax treaty. Under the Treaty, the withholding tax rate is reduced to 15% on dividends paid by our company to residents of the United States and is further reduced to 5% where the beneficial owner of the dividends is a corporation resident in the United States that owns at least 10% of the voting shares of our company.

Capital Gains

A non-resident holder is not subject to tax under the Income Tax Act in respect of a capital gain realized upon the disposition of a common share of our company unless such share is “taxable Canadian property” (as defined in the Income Tax Act ) of the non-resident holder. Our common shares generally will not be taxable Canadian property of a non-resident holder unless the non-resident holder alone or together with non-arm’s length persons owned, or had an interest in an option in respect of, not less than 25% of the issued shares of any class of our capital stock at any time during the 60 month period immediately preceding the disposition of the shares. In the case of a non-resident holder resident in the United States for whom shares of our company are taxable Canadian property, no Canadian taxes will generally be payable on a capital gain realized on such shares by reason of the Treaty unless the value of such shares is derived principally from real property situated in Canada.

Material United States Federal Income Tax Consequences

The following is a general discussion of certain possible United States Federal foreign income tax matters under current law, generally applicable to a U.S. Holder (as defined below) of our common shares who holds such shares as capital assets. This discussion does not address all aspects of United States Federal income tax matters and does not address consequences peculiar to persons subject to special provisions of Federal income tax law, such as those described below as excluded from the definition of a U.S. Holder. In addition, this discussion does not cover any state, local or foreign tax consequences. See Taxation Certain Canadian Federal Income Tax Consequences above.

The following discussion is based upon the Internal Revenue Code of 1986, as amended (the “ Code ”), Treasury Regulations, published Internal Revenue Service (“ IRS ”) rulings, published administrative positions of the IRS and court decisions that are currently applicable, any or all of which could be materially and adversely changed, possibly on a retroactive basis, at any time. In addition, this discussion does not consider the potential effects, both adverse and beneficial, of any recently proposed legislation which, if enacted, could be applied, possibly on a retroactive basis, at any time. No assurance can be given that the IRS will agree with such statements and conclusions, or will not take, or a court will not adopt, a position contrary to any position taken herein.

The following discussion is for general information only and is not intended to be, nor should it be construed to be, legal, business or tax advice to any holder or prospective holder of our common shares, and no opinion or representation with respect to the United States Federal income tax consequences to any such holder or prospective holder is made. Accordingly, holders and prospective holders of common shares are urged to consult their own tax advisors with respect to Federal, state, local, and foreign tax consequences of purchasing, owning and disposing of our common shares.

U.S. Holders

As used herein, a “U.S. Holder” includes a holder of less than 10% of our common shares who is a citizen or resident of the United States, a corporation created or organized in or under the laws of the United States or of any political subdivision thereof, any entity which is taxable as a corporation for United States tax purposes and any other person or entity whose ownership of our common shares is effectively connected with the conduct of a trade or business in the United States. A U.S. Holder does not include persons subject to special provisions of Federal income tax law, such as tax-exempt organizations, qualified retirement plans, financial institutions, insurance companies, real estate investment trusts, regulated investment companies, broker-dealers, non-resident alien individuals or foreign corporations whose ownership of our common shares is not effectively connected with the conduct of a trade or business in the United States and shareholders who acquired their shares through the exercise of employee stock options or otherwise as compensation.

Distributions

The gross amount of a distribution paid to a U.S. Holder will generally be taxable as dividend income to the U.S. Holder for United States federal income tax purposes to the extent paid out of our current or accumulated earnings and profits, as determined under United States federal income tax principles. Distributions which are taxable dividends and which meet certain requirements will be “unqualified dividend income” and taxed to U.S. Holders at a maximum United States federal rate of 15%. Distributions in excess of our current and accumulated earnings and profits will be treated first as a tax-free return of capital to the extent the U.S. Holder’s tax basis in the common shares and, to the extent in excess of such tax basis, will be treated as a gain from a sale or exchange of such shares.

Capital Gains

In general, upon a sale, exchange or other disposition of common shares, a U.S. Holder will generally recognize a capital gain or loss for United States federal income tax purposes in an amount equal to the difference between the amount realized on the sale or other distribution and the U.S. Holder’s adjusted tax basis in such shares. Such gain or loss will be a United States source gain or loss and will be treated as a long-term capital gain or loss if the U.S. Holder’s holding period of the shares exceeds one year. If the U.S. Holder is an individual, any capital gain will generally be subject to United States federal income tax at preferential rates if specified minimum holding periods are met. The deductibility of capital losses is subject to significant limitations.

Foreign Tax Credit

A U.S. Holder who pays (or has had withheld from distributions) Canadian income tax with respect to the ownership of our common shares may be entitled, at the option of the U.S. Holder, to either a deduction or a tax credit for such foreign tax paid or withheld. Generally, it will be more advantageous to claim a credit because a credit reduces United States Federal income taxes on a dollar-for-dollar basis, while a deduction merely reduces the taxpayer’s income subject to tax. This election is made on a year-by-year basis and generally applies to all foreign income taxes paid by (or withheld from) the U.S. Holder during that year. There are significant and complex limitations which apply to the tax credit, among which is an ownership period requirement and the general limitation that the credit cannot exceed the proportionate share of the U.S. Holder’s United States income tax liability that the U.S. Holder’s foreign source income bears to his or its worldwide taxable income. In determining the application of this limitation, the various items of income and deduction must be classified into foreign and domestic sources. Complex rules govern this classification process. The availability of the foreign tax credit and the application of these complex limitations on the tax credit are fact specific and holders and prospective holders of our common shares should consult their own tax advisors regarding their individual circumstances.

Passive Foreign Investment Corporation

We do not believe that we are a passive foreign investment corporation (a “ PFIC ”). However, since PFIC status depends upon the composition of a company’s income and assets and the market value of its assets and shares from time to time, there is no assurance that we will not be considered a PFIC for any taxable year. If we were treated as a PFIC for any taxable year during which a U.S. Holder held shares, certain adverse tax consequences could apply to the U.S. Holder.

If we are treated as a PFIC for any taxable year, gains recognized by such U.S. Holder on a sale or other disposition of shares would be allocated ratably over the U.S. Holder’s holding period for the shares. The amount allocated to the taxable year of the sale or other exchange and to any year before we became a PFIC would be taxed as ordinary income. The amount allocated to each other taxable year would be subject to tax at the highest rate in effect for individuals or corporations, as applicable, and an interest charge would be imposed on the amount allocated to such taxable year. Further, any distribution in respect of shares in excess of 125% of the average of the annual distributions on shares received by the U.S. Holder during the preceding three years or the U.S. Holder’s holding period, whichever is shorter, would be subject to taxation as described above. Certain elections may be available to U.S. Holders that may mitigate some of the adverse consequences resulting from PFIC status. However, regardless of whether such elections are made, dividends paid by a PFIC will not be “qualified dividend income” and will generally be taxed at the higher rates applicable to other items of ordinary income.

U.S. Holders and prospective holders should consult their own tax advisors regarding the potential application of the PFIC rules to their ownership of our common shares.

F. Dividends and Paying Agents

Not applicable.

G. Statements by Experts

Not applicable.

H. Documents on Display

Documents concerning our company referred to in this annual report may be viewed by appointment during normal business hours at our registered and records office at Suite 800 - 885 West Georgia Street, Vancouver, British Columbia, Canada V6C 3H1.

I. Subsidiary Information

We have one subsidiary: TrichoScience Innovations Inc., a company incorporated on September 7, 2006 under the

Business Corporations Act (Canada).

ITEM 11. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to various market risks including currency risks, credit risks, liquidity risks and interest rate risks, which may affect our results of operations and financial condition and, consequently, the value of our company. Generally, our management believes that our current financial assets and financial liabilities, due to their short-term nature, do not pose significant financial risks. Please refer to Note 12 of our annual financial statement contained herein for a qualitative and quantitative discussion of our exposure to market risks at December 31, 2011.

ITEM 12. Description of Securities Other Than Equity Securities

Not applicable.

PART II

ITEM 13. Defaults, Dividend Arrearages and Delinquencies

Not applicable.

ITEM 14. Material Modifications to the Rights of Security Holders and Use of Proceeds

Not applicable.

ITEM 15. Controls and Procedures

A. Disclosure Controls and Procedures

As required by paragraph (b) of Rules 13a-15 or 15d-15 under the Exchange Act, our principal executive officer and principal financial officer evaluated our company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this annual report on Form 20-F. Based on this evaluation, these officers concluded that as of the end of the period covered by this Annual Report on Form 20-F, our disclosure controls and procedures were not effective to ensure that the information required to be disclosed by our company in reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. These disclosure controls and procedures include controls and procedures designed to ensure that such information is accumulated and communicated to our company’s management, including our company’s principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure. The conclusion that our disclosure controls and procedures were not effective was due to the presence of material weaknesses in internal control over financial reporting as identified below under the heading “Management’s Report on Internal Control Over Financial Reporting.” Management anticipates that such disclosure controls and procedures will not be effective until the material weaknesses are remediated. Our company intends to remediate the material weaknesses as set out below.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected.

B. Management’s Report on Internal Control Over Financial Reporting

Our company’s management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) for our company. Our company’s internal control over financial reporting is designed to provide reasonable assurance, not absolute assurance, regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States of America. Internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our company’s assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles in the United States of America, and that our company’s receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on our financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions and that the degree of compliance with the policies or procedures may deteriorate.

Our management, including our principal executive officer and principal financial officer, conducted an evaluation of the design and operation of our internal control over financial reporting as of December 31, 2011 based on the criteria set forth in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. This evaluation included review of the documentation of controls, evaluation of the design effectiveness of controls, testing of the operating effectiveness of controls and a conclusion on this evaluation. Based on this evaluation, our management concluded our internal control over financial reporting was not effective as at December 31, 2011 due to the following material weaknesses: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting, financial reporting and corporate governance.

Our company has taken steps to enhance and improve the design of our internal controls over financial reporting, however these steps were not complete as of December 31, 2011. During the period covered by this annual report on Form 20-F, we have not been able to remediate the material weaknesses identified above.

Plan for Remediation of Material Weaknesses

We intend to take appropriate and reasonable steps to make the necessary improvements to remediate these deficiencies. We intend to consider the results of our remediation efforts and related testing as part of our year-end 2012 assessment of the effectiveness of our internal control over financial reporting.

Subject to receipt of additional financing, we have undertaken, or intend to undertake, the below remediation measures to address the material weaknesses described in this annual report. Such remediation activities include the following:

1.	we have adopted an independent audit committee as additional board members have been retained;

2.	we have retained a qualified VP Finance to assist in the preparation of our public filings and assist on accounting matters; and

3.	we intend to continue to update the documentation of our internal control processes, including formal risk assessment of our financial reporting processes.

The remediation efforts set out above are largely dependent upon our company securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.

Our internal control over financial reporting was not subject to attestation by our independent registered public accounting firm pursuant to the rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

C. Changes in Internal Controls Over Financial Reporting

There were no changes in internal controls over financial reporting during the year ended December 31, 2011 that have materially affected or are reasonably likely to materially affect, our internal control over financial reporting. However, as a result of the evaluation of our internal control over financial reporting as of December 31, 2011, conducted by our principal executive officer and principal financial officer, we expect to make such changes in the year ended December 31, 2012.

ITEM 16. [Reserved]

ITEM 16A. Audit Committee Financial Expert

Our board of directors has determined that at least one member of its audit committee, being Mr. Peter Lewis, qualifies as an “audit committee financial expert” as defined in Item 16A(b) of Form 20-F. Mr. Lewis is also “independent” as that term is defined in Nasdaq Marketplace Rule 5605(a)(2).

ITEM 16B. Code of Ethics

Code of Ethics

Effective July 15, 2004, our board of directors adopted a Code of Business Conduct and Ethics that applies to, among other persons, our president (being our principal executive officer) and our chief financial officer (being our principal financial and accounting officer), as well as persons performing similar functions. As adopted, our Code of Business Conduct and Ethics sets forth written standards that are designed to deter wrongdoing and to promote:

	(1)	honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

	(2)	full, fair, accurate, timely, and understandable disclosure in reports and documents that we file with, or submit to, the Securities and Exchange Commission and in other public communications made by us;

	(3)	compliance with applicable governmental laws, rules and regulations;

	(4)	the prompt internal reporting of violations of the Code of Business Conduct and Ethics to an appropriate person or persons identified in the Code of Business Conduct and Ethics; and

	(5)	accountability for adherence to the Code of Business Conduct and Ethics.

Our Code of Business Conduct and Ethics requires, among other things, that all of our company’s personnel shall be accorded full access to our president and secretary with respect to any matter which may arise relating to the Code of Business Conduct and Ethics. Further, all of our company’s personnel are to be accorded full access to our company’s board of directors if any such matter involves an alleged breach of the Code of Business Conduct and Ethics by our President or Secretary.

In addition, our Code of Business Conduct and Ethics emphasizes that all employees, and particularly managers and/or supervisors, have a responsibility for maintaining financial integrity within our company, consistent with generally accepted accounting principles, and federal, provincial and state securities laws. Any employee who becomes aware of any incidents involving financial or accounting manipulation or other irregularities, whether by witnessing the incident or being told of it, must report it to his or her immediate supervisor or to our company’s president. If the incident involves an alleged breach of the Code of Business Conduct and Ethics by the president, the incident must be reported to any member of our board of directors. Any failure to report such inappropriate or irregular conduct of others is to be treated as a severe disciplinary matter. It is against our company policy to retaliate against any individual who reports in good faith the violation or potential violation of our company’s Code of Business Conduct and Ethics by another.

Our Code of Business Conduct and Ethics was filed with the Securities and Exchange Commission as Exhibit 14.1 to our annual report filed on July 15, 2004. We will provide a copy of the Code of Business Conduct and Ethics to any person without charge, upon request. Requests can be sent to: RepliCel Life Sciences Inc., Suite 1225 – 888 Dunsmuir Street, Vancouver, British Columbia, Canada V6K 3C4.

ITEM 16C. Principal Accountant Fees and Services

Audit Fees

Our board of directors appointed BDO Canada LLP, Chartered Accountants, as independent auditors to audit our consolidated financial statements for the fiscal year ended December 31, 2010. The aggregate fees billed by BDO Canada LLP for audit services rendered for the audit of our annual financial statements, interim reviews of our quarterly financial statements and audit of the January 1, 2010 opening balance sheet transition to IFRS for the fiscal years ended December 31, 2011 and December 31, 2010 were $139,719 and $33,792, respectively.

Audit Related Fees

For the fiscal year ended December 31, 2011, and 2010, the aggregate fees billed for audit related services by BDO Canada LLP were $Nil and $Nil, respectively.

Tax Fees

For the fiscal years ended December 31, 2011 and 2010, the aggregate fees billed for tax compliance, tax advice and tax planning by BDO Canada LLP were $8,060 and $4,160, respectively.

All Other Fees

For the fiscal years ended December 31, 2011 and 2010, the aggregate fees billed by BDO Canada LLP for other non-audit professional services, other than those services listed above, were $Nil and $Nil, respectively.

Pre-Approval Policies and Procedures

Our audit committee pre-approves all services provided by our independent auditors. All of the services and fees described under the categories of “Audit Fees”, “Audit Related Fees”, “Tax Fees” and “All Other Fees” were reviewed and approved by the audit committee before the respective services were rendered, and none of such services were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

The audit committee has considered the nature and amount of the fees billed by BDO Canada LLP, Chartered Accountants, and believes that the provision of the services for activities unrelated to the audit is compatible with maintaining the independence of BDO Canada LLP, Chartered Accountants.

ITEM 16D. Exemption from the Listing Standards for Audit Committees

Not applicable.

ITEM 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers

In 2011, neither we nor any affiliated purchaser (as defined in the Securities Exchange Act of 1934) purchased any of our common shares.

ITEM 16F. Change in Registrant’s Certifying Accountant

Effective December 22, 2010, we completed the acquisition of 55.3% of the issued and outstanding shares of TrichoScience, such that TrichoScience became a material subsidiary of our company. In connection with that transaction, TrichoScience was required to prepare financial statements, which financial statements were audited by BDO Canada LLP. As we determined to treat the transaction as a reverse acquisition for accounting purposes, our board of directors, together with our audit committee, determined to approve the dismissal of Manning Elliott LLP as our principal independent accountant and to engage BDO Canada LLP as our principal independent accountant. Information with respect to the change of auditor was included in our Form 20-F for the fiscal year ended December 31, 2010.

ITEM 16G. Corporate Governance

Not applicable.

ITEM 16H. Mine Safety Disclosure

Not applicable.

ITEM 17. Financial Statements

Financial Statements Filed as Part of this Report:

1. Audited Annual Consolidated Financial Statements as at December 31, 2011 and 2010:

	Independent Auditor’s Report of BDO Canada LLP, dated April 20, 2012;

	Consolidated Statement of Financial Position as at December 31, 2011, 2010 and January 1, 2010;

	Consolidated Statement of Comprehensive Loss for the years ended December 31, 2011 and 2010;

	Consolidated Statements of Cash Flows for the years ended December 31, 2011 and 2010

	Consolidated Statement of Changes in Equity (Deficiency) for the years ended December 31, 2011 and 2010; and

	Notes to the Consolidated Financial Statements.

F-1

REPLICEL LIFE SCIENCES INC.
(formerly NEWCASTLE RESOURCES LTD.)

INDEPENDENT AUDITOR’S REPORT AND CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

( Stated in Canadian Dollars )

F- 2

	Tel: 604 688 5421	BDO Canada LLP
	Fax: 604 688 5132	600 Cathedral Place
	www.bdo.ca	925 West Georgia Street
		Vancouver BC V6C 3L2 Canada

INDEPENDENT AUDITOR'S REPORT

To the shareholders of RepliCel Life Sciences Inc. (formerly Newcastle Resources Ltd.)

We have audited the accompanying consolidated financial statements of RepliCel Life Sciences Inc., which comprise the consolidated statement of financial position as at December 31, 2011, December 31, 2010 and January 1, 2010, and the consolidated statements of comprehensive loss, cash flows, and changes in equity for the years ended December 31, 2011 and 2010, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards as issued by the IASB, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with Canadian generally accepted auditing standards and the standards of the Public Company Accounting and Oversight Board (United States). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of RepliCel Life Sciences Inc. as at December 31, 2011, December 31, 2010 and January 1, 2010, and its financial performance and its cash flows for the years ended December 31, 2011 and December 31, 2010 in accordance with International Financial Reporting Standards as issued by the IASB.

Emphasis of Matter

Without qualifying our opinion, we draw attention to Note 2c in the accompanying financial statements which indicates the Company has incurred recurring operating losses since inception, which raises substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of these uncertainties.

“BDO Canada LLP”

Chartered Accountants
Vancouver, British Columbia

April 20, 2012

F-3

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

Consolidated Statement of Financial Position

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

			December			December 31,			January 1,
	Notes		31, 2011			2010			2010
						(Note 16	)		(Note 16	)
Assets

Current assets
Cash		$	565,143		$	1,211,525		$	603,907
Sales taxes recoverable			27,045			40,877			-
Prepaid expenses			20,644			23,592			21,320
			612,832			1,275,994			625,227
Non-current assets
Equipment	6		18,587			32,748			19,239

Total assets		$	631,419		$	1,308,742		$	644,466

Liabilities

Current liabilities
Accounts payable and accrued liabilities			153,694			548,280			87,423
Advances payable	7		76,275			75,015			-

Total liabilities			229,969			623,295			87,423

Shareholders’ equity

Common shares	8		6,266,739			3,344,320			1,154,800
Preferred shares			-			204			-
Share subscriptions			-			-			17,500
Contributed surplus			1,004,932			235,705			-
Deficit			(6,870,221	)		(3,219,782	)		(615,257	)
Attributable to owners’ of the parent			401,450			360,447			557,043
Attributable to the non-controlling interest			-			325,000			-

Total shareholders’ equity			401,450			685,447			557,043

Total liabilities and shareholders’ equity		$	631,419		$	1,308,742		$	644,466

The accompanying notes form an integral part of these consolidated financial statements

Approved on behalf of the Board:

/s/Peter Jensen		/s/ David Hall
Director		Director

F-4

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

Consolidated Statement of Comprehensive Loss

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

		2011			2010
Clinical development expenses
Clinical trials costs (Note 8)	$	637,649		$	367,763

Research and development expenses
Consulting fees (Note 9)		292,207			132,100
Intellectual property costs		89,552			50,386

General and administrative expenses
Accounting and audit fees		120,357			81,456
Depreciation (Note 6)		7,591			6,940
Computer and IT expenses		17,707			21,638
Consulting fees (Note 9)		185,959			198,196
Insurance		48,007			30,472
Legal fees (Note 9)		118,950			116,954
Listing expense (Note 5)		-			85,000
Marketing consulting fees		334,709			57,353
Office and telephone		98,911			29,556
Rent (Note 9)		81,330			26,916
Salaries (Note 9)		623,027			109,830
Stock-based compensation (Notes 5 and 8)		947,272			1,176,900
Travel and promotion		130,098			51,065
Foreign exchange loss (gain)		(39,386	)		-
Other expenses
Loss on disposal of equipment		19,499			-
Total comprehensive loss	$	3,713,439		$	2,542,525

Total comprehensive loss attributable to non-controlling Interest	$	219,479		$	-
Total comprehensive loss attributable to owners’ of the Parent		3,493,960			2,542,525

Basic and diluted loss per share	$	(0.10	)	$	(0.12	)

Weighted average shares outstanding		34,942,240			21,567,675

The accompanying notes form an integral part of these consolidated financial statements

F-5

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)
Consolidated Statement of Cash Flows
For the year-ended December 31, 2011
(Stated in Canadian Dollars)

		December 31,			December
		2011			31, 2010

Operating activities

Net loss and comprehensive loss	$	(3,713,439	)	$	(2,542,525	)
Add items not involving cash:
Depreciation		7,591			6,940
Loss on disposal of equipment		19,499			-
Stock-based compensation		947,272			1,176,900
Listing expense		-			85,000

Changes in non-cash working capital balances:
Sales taxes recoverable		13,832			(21,558	)
Prepaid expenses		2,948			11,120
Accounts payable and accrued liabilities		(394,586	)		389,822
Advances payable		1,260			-
Net cash used in operating activities		(3,115,623	)		(894,301	)

Investing activities

Purchase of Equipment		(12,929	)		(20,449	)
Cash acquired on acquisition of Newcastle		-			1,109,664
Net cash (used in) provided by investing activities		(12,929	)		1,089,215

Financing activities

Acquisition costs		-			-
Issuance of preferred shares		-			204
Issuance of common shares		2,482,170			412,500
Net cash provided by financing activities		2,482,170			412,704

Decrease in cash during the period		(646,382	)		607,618

Cash , beginning of the period		1,211,525			603,907

Cash , end of the period	$	565,143		$	1,211,525

Non-cash transactions (Note 14)

The accompanying notes form an integral part of these consolidated financial statements

F-6

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)
Consolidated Statement of Changes in Equity (Deficiency)
For the year-ended December 31, 2011
(Stated in Canadian Dollars)

	Attributable to the Owners’ of the Parent																						Attributable
	Common Stock																						To Non-
						Share		Series B Preferred Shares			Series C Preferred Shares				Contributed		Accumulated						Controlling
	Shares			Amount		Subscriptions		Shares		Amount	Shares		Amount		Surplus		Deficit			Total			Interest		Total


Balance, January 1, 2010	9,154,800		$	1,154,800	$	17,500		-	$	-	-	$	-	$	-	$	(615,257	)	$	557,043		$	-	$	557,043

Net loss for the year	-			-		-		-		-	-		-		-		(2,542,525	)		(2,542,525	)		-		(2,542,525	)

Shares issued for cash at $1.00	430,000			430,000		(30,000	)	-		-	-		-		-		-			400,000			-		400,000

Cash received for shares issued in 2009 at $1.00	-			-		12,500		-		-	-		-		-		-			12,500			-		12,500

Recapitalization transactions

Pursuant to the acquisition of TrichoScience – Note 5	(9,584,800	)		-		-		-		-	-		-		-		-			-			-		-

Exchange of shares – Note 5	22,653,960			818,325		-		5,577,580		-	5,577,580		-		-		(62,000	)		756,325			325,000		1,081,325

Acquisition of 583885 – Note 5	4,400,000			941,195		-		-		-	-		-		-		-			941,195			-		941,195

Preferred shares issued for cash at US$0.0001 – Note 5	-			-		-		-		-	2,000,000		204		-		-			204			-		204

Stock based compensation	-			-		-		-		-	-		-		235,705		-			235,705			-		235,705

Balance, December 31, 2010	27,053,960		$	3,344,320	$	-		5,577,580	$	-	7,577,580	$	204	$	235,705	$	(3,219,782	)	$	360,447		$	325,000	$	685,447

The accompanying notes form an integral part of these consolidated financial statements

F-7

																									Attributable
	Attributable to the Owners’ of the Parent																								To
	Common Stock																								Non-
					Share	Series B Preferred Shares				Series C Preferred Shares							Contributed		Accumulated						Controlling
	Shares		Amount		Subscriptions	Shares			Amount	Shares				Amount			Surplus		Deficit			Total			Interest			Total


Balance, January 1, 2011	27,053,960	$	3,344,320	$	-	5,577,580		$		-	7,577,580		$	204		$	235,705	$	(3,219,782	)	$	360,447		$	325,000		$	685,447

Net loss for the period	-		-		-	-				-	-			-			-		(3,493,960	)		(3,493,960	)		(219,479	)		(3,713,439	)

Private placement – Note 8b	2,651,200		2,482,170		-	-				-	-			-			-		-			2,482,170			-			2,482,170

Increase in non- controlling interest attributable to issuance of shares for cash to parent – Note 5	-		-		-	-				-	-			-			-		(505,345	)		(505,345	)		505,345			-

Exchange of shares – Note 5	10,844,846		262,000		-	5,422,420				-	5,422,420			-			-		348,866			610,866			(610,866	)		-

Cancellation of shares – Note 5	2,600,002		204		-	(11,000,000	)			-	(13,000,000	)		(204	)		-		-			-			-			-

Stock based compensation – Note 8 / Escrow release – Note 5	-		178,045		-	-				-	-			-			769,227		-			947,272			-			947,272

Balance, December 31, 2011	43,150,008	$	6,266,739	$	-	-		$		-	-		$	-		$	1,004,932	$	(6,870,221	)	$	401,450		$	-		$	401,450

The accompanying notes form an integral part of these consolidated financial statements

F-8

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

1.	Corporate Information

	Newcastle Resources Ltd. was incorporated under the Ontario Business Corporations Act on April 24, 1967. On June 22, 2011, Newcastle Resources changed its name to RepliCel Life Sciences Inc. (“the Company” or “RepliCel”) and its reporting jurisdiction to British Columbia. Its common shares are listed for trading in the United States on the OTCBB, trading under the symbol REPCF.

	The address of the Company’s corporate office and principal place of business is Suite 1225 – 888 Dunsmuir Street, Vancouver, BC, V6C 3K4.

2.	Basis of Presentation

a) Statement of Compliance and Conversion to International Financial Reporting Standards

The financial statements of the Company for the year-ended December 31, 2011 have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). This is the first time that the Company has prepared its financial statements in accordance with IFRS, having previously prepared its financial statements in accordance with pre-changeover Canadian Generally Accepted Accounting Principles (“pre-changeover Canadian GAAP”). These are the Company’s first consolidated financial statements prepared in accordance with IFRSs and IFRS 1 First-time Adoption of International Financial Reporting Standards has been applied.

An explanation of the impact of the transition to IFRS, including the nature and effect of significant changes in accounting policies from those used in the Company’s consolidated financial statements is included in Note 16.

The financial statements were authorized for issue on April, 23 2012 by the directors of the Company.

b) Basis of Measurement

These consolidated financial statements have been prepared on a historical cost basis. These consolidated financial statements are presented in Canadian dollars (“CDN”), which is also the functional currency of the Company and its subsidiaries.

The preparation of financial statements in compliance with IFRS requires management to make certain critical accounting estimates. It also requires management to exercise judgment in applying the Company’s accounting policies. The areas involving a higher degree of judgment of complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 3.

c) Going Concern of Operations

These consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will continue to realize its assets and discharge its obligations and commitments in the normal course of operations. At December 31, 2011, the Company is in the research stage, and has accumulated losses of $6,870,221 since its inception and expects to incur further losses in the development of its business, which casts substantial doubt about the Company’s ability to continue as a going concern.

The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management has a plan in place to address this concern and intends to obtain additional funds by equity financing to the extent there is a shortfall from operations. While the Company is continuing its best efforts to achieve the above plans, there is no assurance that any such activity will generate funds for operations.

F-9

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

2.	Basis of Presentation - Continued

	If the going concern assumptions were not appropriate for these consolidated financial statements, then adjustments would be necessary to the carrying value of assets and liabilities, the reported net loss and the balance sheet classifications used.

d) Principles of Consolidation

These consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at December 31, 2011, and the results of all subsidiaries for the year then ended.

Where the company has the power, either directly or indirectly, to govern the financial and operating policies of another entity or business so as to obtain benefits from its activities, it is classified as a subsidiary. The consolidated financial statements present the results of the company and its subsidiaries ("the Group") as if they formed a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.

The consolidated financial statements incorporate the results of business combinations using the purchase method. In the statement of financial position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.

Reverse take-overs that do not meet the definition of a business are accounted for as asset acquisitions using the requirements of IFRS 2 – share-based payments.

Non-controlling interests

In preparing consolidated financial statements the Group has the choice, on a transaction by transaction basis, to initially recognise any non-controlling interest in the acquiree which is a present ownership interest and entitles its holders to a proportionate share of the entity’s net assets in the event of liquidation at either acquisition date fair value or, at the present ownership instruments’ proportionate share in the recognised amounts of the acquiree’s identifiable net assets. Other components of non-controlling interest such as outstanding share options are generally measured at fair value. The group has not elected to take the option to use fair value in acquisitions completed to date.

From January 1, 2010, the total comprehensive income of non-wholly owned subsidiaries is attributed to owners of the parent and to the non-controlling interests in proportion to their relative ownership interests.

Details of controlled entities are as follows:

		Percentage Owned
	Country of
	Incorporation	December 31, 2011	December 31, 2010
TrichoScience Innovations Inc.	Canada	100%	55.4%
583885 BC Ltd. (Note 2 d) ⁱ	Canada	- %	100%

^1. 583885 BC Ltd. was dissolved on July 29, 2011.

F-10

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

3.	Summary of Significant Accounting Policies

	The accounting policies set out below have been applied consistently to all years presented in these consolidated financial statements and in preparing the opening IFRS balance sheet at January 1, 2010 for the purposes of the transition to IFRS, unless otherwise indicated.

a) Critical Accounting Estimates, assumptions and judgements

The preparation of consolidated financial statements requires the use of estimates, assumptions and judgment that in some cases relate to matters that are inherently uncertain, and which affect the amounts reported in the consolidated financial statements and accompanying notes. Changes to estimates and assumptions may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period.

Actual results could also differ from those estimates under different assumptions and conditions. Information about critical judgments in applying accounting policies that have the most significant risk of causing material adjustment to the amounts reported in these financial statements are discussed below:

Share Based Payments

Income Taxes

Significant judgment is required in determining the provision for income taxes. There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Company recognizes liabilities and contingencies for anticipated tax audit issues based on the Company’s current understanding of the tax law. For matters where it is probable that an adjustment will be made, the Company records its best estimate of the tax liability including the related interest and penalties in the current tax provision. Management believes they have adequately provided for the probable outcome of these matters; however, the final outcome may result in a materially different outcome than the amount included in the tax liabilities.

Fair Value of RTO Transaction

F-11

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

3.	Summary of Significant Accounting Policies - Continued

b) Cash

Cash includes cash on hand and in interest bearing bank accounts.

c) Equipment

Recognition and Measurement

On initial recognition, equipment is valued at cost, being the purchase price and directly attributable cost of acquisition or construction required to bring the asset to the location and condition necessary to be capable of operating in the manner intended by the Company, including appropriate borrowing costs and the estimated present value of any future unavoidable costs of dismantling and removing items. The corresponding liability is recognized within provisions.

Equipment is subsequently measured at cost less accumulated depreciation, less any accumulated impairment losses.

When parts of an item of equipment have different useful lives, they are accounted for as separate items (major components) of equipment.

Major Maintenance and Repairs

Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the profit or loss during the financial period in which they are incurred.

Gains and Losses

Gains and losses on disposal of an item of equipment are determined by comparing the proceeds from disposal with the carrying amount, and are recognized net within other income in profit or loss.

Depreciation

Depreciation and amortization rates applicable to each category of equipment are as follows:

Office furniture and equipment	20%
Computer equipment	30%

Depreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate Depreciation is taken at half the annual rate in the year of acquisition.

d) Impairment of Non-Financial Assets

Impairment tests on intangible assets with indefinite useful economic lives are undertaken annually at the financial year-end. Other non-financial assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amounts, which is the higher of value in use and fair value less costs to sell, the asset is written down accordingly.

F-12

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

3.	Significant Accounting Policies - Continued

d) Impairment of Non-Financial Assets - Continued

Where it is possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the asset’s cash-generating unit, which is the lowest group of assets in which the asset belongs for which there are separately identifiable cash inflows that are largely independent of the cash inflows from other assets. The Company has one cash-generating unit for which impairment testing is performed.

An impairment loss is charged to the profit or loss, except to the extent they reverse gains previously recognized in other comprehensive loss/income.

e) Basic and Diluted Loss per Share

Basic loss per share is calculated by dividing the net loss by the weighted average number of common shares outstanding for the relevant period.

Diluted loss per share reflects the potential dilution of common shares that could occur if potentially dilutive securities are exercised or converted to common shares. Options and warrants are dilutive when they would result in the issue of ordinary shares for less than the average market price of ordinary shares during the period. The amount of the dilution is the average market price of ordinary shares during the period minus the issue price. Dilutive amounts are not presented when the effect of the computations is anti-dilutive due to the losses incurred. Accordingly, there would be no difference in the amounts presented for basic and diluted loss per share.

The number of shares potentially issuable at December 31, 2011 that were not included in the computation of net loss per share totaled 5,035,000 (2010: 2,550,000) consisting of 2,835,000 (2010: 1,485,000) outstanding stock options and 2,200,000 (2010: 2,550,000) contingently issuable common shares held in escrow to be released upon the occurrence of certain milestones (Note 8(f)).

f) Income Taxes

Income tax expense comprises of current and deferred tax. Current tax and deferred tax are recognized in net income except to the extent that it relates to a business combination or items recognized directly in equity or in other comprehensive loss/income.

Current income taxes are recognized for the estimated income taxes payable or receivable on taxable income or loss for the current year and any adjustment to income taxes payable in respect of previous years. Current income taxes are determined using tax rates and tax laws that have been enacted or substantively enacted by the year-end date.

Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the consolidated statement of financial position differs from its tax base, except for differences arising on:

	•	the initial recognition of goodwill;
	•	the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction affects neither accounting or taxable profit; and
	•	investments in subsidiaries and jointly controlled entities where the Group is able to control the timing of the reversal of the difference and it is probable that the difference will not reverse in the foreseeable future.

Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available against which the difference can be utilised.

F-13

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

3.	Significant Accounting Policies - Continued

f)	Income Taxes – Continued

	The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the reporting date and are expected to apply when the deferred tax liabilities/(assets) are settled/(recovered).

	Deferred tax assets and liabilities are offset when the Group has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority on either:

	•	the same taxable group company; or
	•	different group entities which intend either to settle current tax assets and liabilities on a net basis, or to realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax assets or liabilities are expected to be settled or recovered.

g)	Intangible Assets

	*Externally acquired intangible assets*

	Externally acquired intangible assets are initially recognised at cost and subsequently amortised on a straight-line basis over their useful economic lives.

	In-process research and development programmes acquired in combinations are recognised as an asset even if subsequent expenditure is written off because the criteria specified in the policy for development costs below are not met.

	*Internally generated intangible assets (development costs)*

	Expenditure on internally developed products is capitalised if it can be demonstrated that:

	•	it is technically feasible to develop the product for it to be sold;
	•	adequate resources are available to complete the development;
	•	there is an intention to complete and sell the product;
	•	the Group is able to sell the product;
	•	sale of the product will generate future economic benefits; and
	•	expenditure on the project can be measured reliably.

Capitalised development costs are amortised over the periods the Group expects to benefit from selling the products developed.

Development expenditure not satisfying the above criteria and expenditure on the research phase of internal projects are recognised in the consolidated statement of comprehensive income as incurred.

		The Company expenses research costs until such time FDA approval is obtained.

	h)	Foreign Currency Translation

		Foreign currency accounts are presented in Canadian dollars, which is also the functional currency.

F-14

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

3.	Significant Accounting Policies - Continued

	h)	Foreign Currency Translation – Continued

		At the transaction date, each asset, liability, revenue and expense denominated in a foreign currency is translated into Canadian dollars by the use of the exchange rate in effect at that date. At the year-end date, unsettled monetary assets and liabilities are translated into Canadian dollars by using the exchange rate in effect at the year-end date and the related translation differences are recognized in net income.

		Non-monetary assets and liabilities that are measured at historical cost are translated into Canadian dollars by using the exchange rate in effect at the date of the initial transaction and are not subsequently restated. Non-monetary assets and liabilities that are measured at fair value or a re-valued amount are translated into Canadian dollars by using the exchange rate in effect at the date the value is determined and the related translation differences are recognized in net income or other comprehensive loss consistent with where the gain or loss on the underlying non-monetary asset or liability has been recognized.

	i)	Share-based Payments

		The Company adopted a stock option plan during the year ended December 31, 2010 (Note 8(c)). In addition, certain of the Company’s founders have entered into option agreements with consultants and employees of the Company.

		Employees (including senior executives) of the Company receive remuneration in the form of share-based payment transactions, whereby employees render services as consideration for equity instruments (equity-settled transactions).

		*Equity-settled transactions*

		The cost of equity-settled transactions is recognized, together with a corresponding increase in other capital reserves in equity, over the period in which the performance and/or service conditions are fulfilled. The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company’s best estimate of the number of equity instruments that will ultimately vest. The income statement expense or credit for a period represents the movement in cumulative expense recognized as at the beginning and end of that period and is recognized as stock based compensation expense (Note 8(c)).

		No expense is recognized for awards that do not ultimately vest, except for equity-settled transactions where vesting is conditional upon a market or non-vesting condition, which are treated as vesting irrespective of whether or not the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied.

		Where the terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense as if the terms had not been modified, if the original terms of the award are met. An additional expense is recognized for any modification that increases the total fair value of the share-based payment transaction, or is otherwise beneficial to the employee as measured at the date of modification.

		Where an equity-settled award is cancelled, it is treated as if it vested on the date of cancellation, and any expense not yet recognized for the award is recognized immediately. This includes any award where non-vesting conditions within the control of either the entity or the employee are not met. However, if a new award is substituted for the cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new awards are treated as if they were a modification of the original award, as described in the previous paragraph. All cancellations of equity-settled transaction awards are treated equally. No expense is recognized for awards that do not ultimately vest.

F-15

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

	The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

3.	Significant Accounting Policies - Continued

i) Share-based Payments – Continued

Cash-settled transactions

The cost of cash-settled transactions is measured initially at fair value at the grant date using a binomial model. This fair value is expensed over the period until the vesting date with recognition of a corresponding liability. The liability is remeasured to fair value at each reporting date up to and including the settlement date, with changes in fair value recognized as employee benefits expense.

j) Leased assets

Where substantially all of the risks and rewards incidental to ownership of a leased asset have been transferred to the Group (a "finance lease"), the asset is treated as if it had been purchased outright. The amount initially recognised as an asset is the lower of the fair value of the leased property and the present value of the minimum lease payments payable over the term of the lease. The corresponding lease commitment is shown as a liability. Lease payments are analysed between capital and interest. The interest element is charged to the consolidated statement of comprehensive income over the period of the lease and is calculated so that it represents a constant proportion of the lease liability. The capital element reduces the balance owed to the lessor.

Where substantially all of the risks and rewards incidental to ownership are not transferred to the Group (an "operating lease"), the total rentals payable under the lease are charged to the consolidated statement of comprehensive income on a straight-line basis over the lease term. The aggregate benefit of lease incentives is recognised as a reduction of the rental expense over the lease term on a straight-line basis.

k) Events After the Balance Sheet Date

Events after the balance sheet date that provide additional information about the Company’s position at the balance sheet date (adjusting event) are reflected in the consolidated financial statements. Events after the balance sheet date that are not adjusting events, if any, are disclosed when material to the consolidated financial statements.

l) Financial Instruments

The Company classifies its financial instruments in the following categories: at fair value through profit or loss, loans and receivables, held-to-maturity investments, available-for-sale and financial liabilities. The classification depends on the purpose for which the financial instruments were acquired. Management determines the classification of its financial instruments at initial recognition.

Financial assets are classified at fair value through profit or loss when they are either held for trading for the purpose of short-term profit taking, derivatives not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented risk management or investment strategy. Such assets are subsequently measured at fair value with changes in carrying value being included in profit or loss.

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortized cost. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period. These are classified as non-current assets.

F-16

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

3.	Significant Accounting Policies - Continued

l) Financial Instruments – Continued

Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or determinable payments, and it is the Company’s intention to hold these investments to maturity. They are subsequently measured at amortized cost. Held-to-maturity investments are included in non-current assets, except for those which are expected to mature within 12 months after the end of the reporting period.

Available-for-sale financial assets are non-derivative financial assets that are designated as available-for-sale or are not suitable to be classified as financial assets at fair value through profit or loss, loans and receivables or held-to-maturity investments and are subsequently measured at fair value. These are included in current assets. Unrealized gains and losses are recognized in other comprehensive income, except for impairment losses and foreign exchange gains and losses.

Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortized cost. Regular purchases and sales of financial assets are recognized on the trade-date – the date on which the Company commits to purchase the asset.

Financial assets are derecognized when the rights to receive cash flows from the investments have expired or have been transferred and the Company has transferred substantially all risks and rewards of ownership.

At each reporting date, the Company assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a significant and prolonged decline in the value of the instrument is considered to determine whether an impairment has arisen.

The Company does not have any derivative financial assets and liabilities.

IFRS 7 fair value measurement hierarchy

IFRS 7 requires certain disclosures which require the classification of financial assets and financial liabilities measured at fair value using a fair value hierarchy that reflects the significance of the inputs used in making the fair value measurement (see note 3). The fair value hierarchy has the following levels:

	(a)	quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);
	(b)	inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) (Level 2); and
	(c)	inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).

The level in the fair value hierarchy within which the financial asset or financial liability is categorised is determined on the basis of the lowest level input that is significant to the fair value measurement. Financial assets and financial liabilities are classified in their entirety into only one of the three levels.

Impairment of Financial Assets

At each reporting date, the Company assesses whether there is objective evidence that a financial asset carried at amortized cost is impaired. If such evidence exists, the impairment loss is the difference between the amortized costs of the loan or receivable and the present value of the estimated future cash flows, discounted using the instrument’s original effective interest rate. The carrying amount of the asset is reduced by this amount either directly or indirectly through the use of an allowance account. Impairment losses on financial assets carried at amortized cost are reversed in subsequent periods if the amount of the loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized.

F-17

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

3.	Significant Accounting Policies - Continued

m) Share Capital

Financial instruments issued by the Group are classified as equity only to the extent that they do not meet the definition of a financial liability or financial asset.

The Group’s ordinary shares are classified as equity instruments. During the year ended December 31, 2011 the Company also had Class B preferred shares and Class C convertible preferred shares outstanding which are also classified as equity instruments.

4.	Accounting Standards, Amendments and Interpretations Not Yet Effective

	Certain pronouncements were issued by the IASB or the IFRS Interpretations Committee that are mandatory for accounting periods beginning after January 1, 2011 or later periods. The following new standards, amendments and interpretations, which have not been early adopted in these consolidated financial statements, will or may have an effect on the Company’s future results and financial position:

	•	IFRS 9 Financial Instruments

		IFRS 9 Financial Instruments is part of the IASB's wider project to replace IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 retains but simplifies the mixed measurement model and establishes two primary measurement categories for financial assets: amortized cost and fair value. The basis of classification depends on the entity's business model and the contractual cash flow characteristics of the financial asset. The standard is effective for annual periods beginning on or after January 1, 2013. The Company is in the process of evaluating the impact of the new standard.

	•	IFRS 10 Consolidated Financial Statements

		IFRS 10 builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within the consolidated financial statements of the parent company. The standard provides additional guidance to assist in the determination of control where this is difficult to assess. The Company is yet to assess the full impact of IFRS 10 and intends to adopt the standard no later than the accounting period beginning on January 1, 2013.

	•	IFRS 13 Fair Value Measurement

		IFRS 13 aims to improve consistency and reduce complexity by providing a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across IFRSs. The requirements, which are largely aligned between IFRSs and US GAAP, do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is already required or permitted by other standards within IFRSs or US GAAP. The Company is yet to assess the full impact of IFRS 13 and intends to adopt the standard no later than the accounting period beginning on January 1, 2013.

•

IFRS 1: Severe Hyperinflation (Effective for periods beginning on or after July 1, 2011)

F-18

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

	•	IAS 12: Deferred Tax: Recovery of Underlying Assets (Amendments to IAS 12 (Effective for periods beginning on or after January 1, 2012)
	•	Amendments to IFRS 9: Financial Instruments (Effective for periods beginning on or after January 1, 2013)

5.	Reverse Takeover Transaction

	On December 22, 2010, RepliCel closed a Share Exchange Agreement with TrichoScience Innovations Inc. (“TrichoScience”) and with certain accepting shareholders of TrichoScience, whereby RepliCel (formerly Newcastle Resources Ltd.) acquired 50.7% (4,860,000) of the issued and outstanding shares of TrichoScience in exchange for 11,155,165 common shares (at an exchange ratio of 2.2958), 5,577,580 Class B preferred shares and 5,577,580 Class C convertible preferred shares of RepliCel (the “Acquisition”). Also at closing, RepliCel acquired an additional 1,000,000 common shares of TrichoScience for $1,000,000 (“Investment One”), thereby increasing RepliCel’s ownership in TrichoScience to 55.4% at December 31, 2010, resulting in 63% of the voting rights in RepliCel being held by former Trichoscience shareholders.

	TrichoScience was incorporated under the Canada Business Corporations Act on September 7, 2006 and is currently in the research and development stage and therefore has not yet realized any revenues from its planned operations.

	As the former shareholders of TrichoScience controlled 63% of the issued voting shares of RepliCel after the closing of the transaction, the transaction was accounted for as TrichoScience being the continuing entity and the resulting consolidated financial statements are presented as a continuation of TrichoScience. At the date the share exchange was completed the common stock of RepliCel became 22,653,960 common shares, comprising of 11,155,165 common shares issued to participating shareholders of TrichoScience and 11,498,795 common shares held by existing RepliCel shareholders (total common shares 22,653,960). During the year ended December 31, 2011 the remaining TrichoScience shareholders tendered 4,724,800 TrichoScience shares in exchange for 10,844,846 common shares of RepliCel.

	As TrichoScience is deemed to be the acquirer for accounting purposes, its assets and liabilities are included in the consolidated balance sheets for the continuing entity at their historical carrying values. The Company’s assets and liabilities at the date of the transaction are also included in the consolidated balance sheets at their historical carrying values.

	RepliCel is not considered a business as defined by IFRS. As a result, at the date of the acquisition, the transaction was accounted for as a share based payment transaction under IFRS 2 Share Based Payments whereby TrichoScience is deemed to have issued shares in exchange for the net assets of RepliCel together with the listing status of RepliCel.

	The net identifiable assets of RepliCel at the date of the acquisition were as follows:

Cash	$	1,109,664
Sales taxes recoverable		19,319
Prepaid expenses		13,392
Accounts payable and accrued liabilities		(71,035	)
Advances payable		(75,015	)

Net assets acquired	$	996,325

The Company recognized $85,000 as listing expense during the year ended December 31, 2010, being the difference between the fair value of the share based payment of $1,081,325 and the net identifiable assets received. The fair value of the share based payment was determined with reference to the fair market value of Newcastle, (now RepliCel) shares that would have been received by the shareholders of TrichoScience had 100% of the shares been exchanged. The fair value of each Newcastle, (now RepliCel) share was determined with reference to the price at which the shares had been sold in arms’ length transaction prior to the acquisition.

F-19

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

5.	Reverse Takeover Transaction - Continued

	At closing, the TrichoScience shareholders who received shares of RepliCel in connection with the closing deposited the common shares with a trustee pursuant to the terms of a pooling agreement between RepliCel and the trustee. The common shares are subject to a timed release schedule under which 15% of the shares will be released on the first day of each of the fiscal quarters occurring after the first anniversary of the closing.

	*Non-Controlling Interest*

	At closing, certain shareholders of TrichoScience did not exchange their shares for shares of RepliCel (the “Non- Accepting Shareholders”) and, as such, are treated as a non-controlling interest in the consolidated financial statements. In a reverse acquisition, the non-controlling interest reflects the non-controlling shareholders’ proportionate interest in the pre-combination carrying amounts of the legal acquiree’s net assets. The non-controlling interest at December 22, 2010 was 44.6% and the Company recorded a non-controlling interest of $325,000, representing the non-controlling interest of the net book value of the net assets of TrichoScience, with a $62,000 increase in accumulated deficit reflecting the Company’s proportionate increase in ownership in TrichoScience.

	During the year ended December 31, 2011, RepliCel purchased 2,050,000 newly issued common shares of TrichoScience for $2,050,000 (“Investment Two”). As a result, the non-controlling interest increased by $505,345 representing the non-controlling interests’ proportionate share in Investment Two.

	The remaining 4,724,800 shares of TrichoScience were tendered for exchange by the Non-Accepting Shareholders in exchange for 10,844,848 common shares with an ascribed fair value of $262,000, 5,422,420 Series B Preferred Shares and 5,422,420 Series C Preferred Shares of the Company. As a result the non-controlling interest was eliminated and the Company recorded an adjustment of $348,866 into deficit attributable to the Owners’ of the Parent, representing a decrease in the non-controlling interest of the net book value of the net assets of TrichoScience.

	At December 31, 2011, 100% percent of the non-accepting shareholders have tendered their shares in exchange for RepliCel shares. As a result of achieving Investment One and Investment Two, TrichoScience is now 100% owned subsidiary of RepliCel. As a result, the Class B preferred shares were extinguished for no consideration. There is no non-controlling interest at December 31, 2011 (December 31, 2010: $325,000).

	*Class B and C Preferred Shares*

	No amount of the value assigned to share capital issued with the Share Exchange Agreement was allocated to the Class B preferred shares or the Class C convertible preferred shares due to these shares having assessed nominal value of $204 at the time of closing. The Class B preferred shares have been extinguished, as the Company has achieved the following milestones during the year ended December 31, 2011:

	-	RepliCel purchased common shares of TrichoScience in aggregate amount of not less than $3,000,000 and RepliCel raised the proceeds to make these investments by selling its shares at not less than $1 per share (completed); and

	-	RepliCel acquired at least 90% of the issued and outstanding common shares of TrichoScience (completed).

Each Class C convertible preferred share is voting and convertible into ½ of one common share of RepliCel upon approval by the United States Food and Drug Administration of the commercial sale of TrichoScience’s hair cell replication technology in the United States. Other than transfers of Class C Shares amongst original shareholders of TrichoScience Innovations Inc., the Class C convertible preferred shares cannot be sold, transferred or otherwise disposed of without the consent of the Company’s directors.

F-20

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

5.	Reverse Takeover Transaction - Continued

Class B and C Preferred Shares – Continued

During the year-ended December 31, 2011, 13,000,000 of the Company’s Class C preferred shares (each, a “Class C Share”), being all the issued and outstanding Class C Shares, were converted, on a 5:1 ratio, into 2,600,002 common shares of the Company (each, a “Common Share”) by the holders thereof. All of the Common Shares issued on conversion of the Class C Shares have been deposited with a trustee pursuant to the terms of pooling agreements between RepliCel, the trustee and the respective shareholders. The Common Shares are subject to a timed release schedule under which 15% of the shares will be released on the first day of each of the fiscal quarters beginning January 1, 2013. Following the conversion, a total of 43,150,008 Common Shares are issued and outstanding.

583885 B.C. Ltd.

Concurrent with the reverse acquisition, RepliCel also acquired all of the issued and outstanding common shares of 583885 B.C. Ltd. (“583885”) in exchange for 4,400,000 common shares of RepliCel. 583885 did not have any assets or liabilities at the date of acquisition and was a private company controlled by RepliCel’s incoming Chief Executive Officer (“CEO”). 3,400,000 shares of RepliCel controlled by the Company’s CEO were deposited with an escrow agent pursuant to the terms of an escrow agreement between RepliCel and the escrow agent. These shares will be released upon satisfaction of certain performance conditions as set out in the escrow agreement and each release of shares from escrow will be considered a compensatory award.

During the year ended December 31, 2011, the performance conditions with respect to 350,000 shares (Year ended December 31, 2010: 850,000) had been achieved, being the completion of Investment Two (December 31, 2010: Investment One and Investment Two) described above, and $178,045 (December 31, 2010: $432,295) (representing the fair value of the shares released from escrow on the date of release) was recorded as stock-based compensation. Compensation expense relating to the transaction date fair value of the remaining 2,200,000 common shares will be recognized in the period the respective performance condition is probable and amortized over the period until the performance condition is met.

At December 31, 2011, there were 2,200,000 common shares held in escrow (December 31, 2010: 2,550,000 common shares).

The other 1,000,000 common shares issued were not subject to escrow provisions and thus were fully vested, non-forfeitable at the date of issuance. Stock based compensation of $Nil (representing the fair value of the shares issued) was recognized for these shares during the year ended December 31, 2011 (December 31, 2010: $508,800).

F-21

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

6.	Equipment

		Furniture and			Computer
		Equipment			Equipment			Total

Cost:
At December 31, 2010	$	25,880		$	16,258		$	42,138
Additions		-			12,929			12,929
Disposals		(18,885	)		(9,483	)		(28,368	)
At December 31, 2011		6,995			19,704			26,699

Depreciation:
At December 31, 2010		5,311			4,079			9,390
Charge for the period		1,882			5,710			7,592
Elimination on disposal		(5,325	)		(3,545	)		(8,870	)
At December 31, 2011		1,868			6,244			8,112
Net book value at December 31, 2011	$	5,127		$	13,460		$	18,587

		Furniture and		Computer
		Equipment		Equipment		Total

Cost:
At January 1, 2010	$	15,126	$	6,563	$	21,689
Additions		10,754		9,695		20,449
Disposals		-		-		-
At December 31, 2010		25,880		16,258		42,138

Depreciation:
At January 1, 2010		1,513		937		2,450
Charge for the period		3,798		3,142		6,940
Elimination on disposal		-		-		-
At December 31, 2010		5,311		4,079		9,390
Net book value at December 31, 2010	$	20,569	$	12,179	$	32,748

7.	Advances Payable

	Advances payable of $76,275 (US$75,000) is from an unrelated third party. Advances payable are unsecured, non- interest bearing and have no specific terms of repayment.

F-22

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

8.	Share Capital

	a)	Authorized:

		Unlimited common shares without par value

		Unlimited Class A non-voting, convertible, redeemable, non-cumulative 6% preferred shares without par value

	b)	Issued and Outstanding:

		During the year ended December 31, 2011:

	(i)	The Company completed a private placement of 2,550,000 common shares at US$1.00 per share for proceeds of $2,482,170 (US$2,550,000). A finder’s fee of 101,200 common shares was issued in connection with the private placement with a fair value of $98,164 (US$101,200).

	(ii)	The Company acquired 4,724,800 common shares of TrichoScience pursuant to the Non-Accepting Shareholders tendering their shares in exchange for 10,844,848 common shares, 5,422,420 Class B preferred shares and 5,422,420 Class C preferred shares in RepliCel. (Note 5).

During the year ended December 31, 2010:

	(i)	The Company issued 430,000 common shares at a price of $1.00 per share, of which $30,000 had been received during the year ended December 31, 2009.

	(ii)	The Company completed the RTO transaction as described in Note 5.

Stock Option Plans:

	(i)	Under various Founders’ Stock Option Agreements, certain founders of TrichoScience granted stock options to acquire TrichoScience shares to employees and consultants of TrichoScience. These founders’ options are exercisable at $1 per share with 1/3 vesting one year from the date of grant and the remaining 2/3 vesting on a monthly basis over between 24-month and 36-month periods expiring after six to seven years. Pursuant to the Share Exchange Agreement, the Founders Stock Option Agreements were converted into rights to receive the number of Founders’ RepliCel shares acquired by conversion of the founders TrichoScience shares under the Share Exchange Agreement. All other terms remained the same. This modification of stock options resulted in no incremental value and therefore no additional stock based compensation expense was recognized for the modification.

	(ii)	On December 22, 2010, the Company approved a Company Stock Option Plan whereby the Company may grant directors, officers, employees and consultants’ stock options. The maximum number of shares reserved for issue under the plan cannot exceed 10% of the outstanding common shares of the Company as at the date of the grant. The stock options can be exercisable for a maximum of 7 years from the grant date and with various vesting terms.

	d)	Fair value of Options Issued from January 1, 2010 to December 31, 2011

		On March 11, 2011, under the Company Stock Option Plan, 1,350,000 options were granted to the directors, officers and consultants of the Company. The options are exercisable at US$1.00 per share and expire on March 11, 2018. The options vest over a three year period.

F-23

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

8.	Share Capital – Continued

	d)	Fair value of Options Issued from January 1, 2010 to December 31, 2011 – Continued

		During the year ended December 31, 2010, under the Company Stock Option Plan 1,485,000 options were granted to the directors, officers and consultants of the Company. The options are exercisable at US$0.50 per share and expire July 13, 2017. The options fully vested during the year ended December 31, 2011.

		The weighted-average grant date fair value of options granted was estimated using the following weighted average assumptions:

		December 22, 2010	March 11, 2011
	Founders Stock Options	Company Stock Options	Company Stock Options
Risk-free interest rate	2.81%	2.66%	2.88%
Weighted-average expected life	6.55 years	7.00 years	7.00 years
Expected volatility	81%	81%	81%
Expected dividends	Nil	Nil	Nil
Expected forfeiture rate	0%	0%	0%
Fair value	0.17	0.17	0.72

		The volatility assumption is based on the pattern and level of historical volatility of a sample of entities in the life sciences industry for the first seven years in which the shares of those entities were publicly traded.

		Options Issued to Employees

		The fair value at grant date is determined using a Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield, the expected forfeiture rate and the risk free interest rate for the term of the option.

		Options Issued to Non-Employees

		Options issued to non-employees, are measured based on the fair value of the goods or services received, at the date of receiving those goods or services. If the fair value of the goods or services received cannot be estimated reliably, the options are measured by determining the fair value of the options granted, using a valuation model.

	e)	Stock-based Compensation

		The Company recognized a fair value of $947,272 as stock based compensation expense in the statement of comprehensive loss for the year ended December 31, 2011; $769,227 (December 31, 2010 - $235,705 (Note 8(e))) for stock options granted under the Company Stock Option Plan and the Founders Stock Option Agreements, and $178,045 for the release of escrow shares (December 31, 2010 - $432,395 (Note 8(f))). During the year ended December 31, 2011 the Company modified founders’ options previously granted to various individuals and no additional compensation was recognized.

F-24

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

8.	Share Capital – Continued

	d)	Stock-based Compensation – Continued

		A summary of the status of the stock options outstanding under the Company Stock Option Plan for the year ended December 31, 2011 is as follows:

			Weighted Average
	Number of Options		Exercise Price
Outstanding, January 1, 2010	-	$	-
Granted	1,485,000		US 0.50
Exercised	-		-
Forfeited	-		-
Outstanding, December 31, 2010	1,485,000		US 0.50
Exercisable, December 31, 2010	-		-

Outstanding, December 31, 2010	1,485,000	$	US 0.50
Granted	1,350,000		US 1.00
Exercised	-		-
Forfeited	-		-
Outstanding, December 31, 2011	2,835,000	$	US 0.74
Exercisable, December 31, 2011	1,822,500	$	US 0.59

		The range of exercise prices for options outstanding under the Company Stock Option Plan as at December 31, 2011 is $0.50 - $1.00 US. The weighted average remaining contractual life for stock options under the Company Stock Option Plan as at December 31, 2011 is 5.85 years.

	f)	Escrow Shares

		Pursuant to the Acquisition described in Note 5, at December 31, 2011:

i)	2,200,000 (December 31, 2010: 2,550,000) common shares are held in escrow and are to be released upon the occurrence of certain milestones relating to the Company’s hair cell replication technology. These shares have been excluded from the calculation of loss per share. During the year ended December 31, 2011, 350,000 of shares were released from escrow pursuant to the $2,050,000 investment by RepliCel in TrichoScience. The Company recognized a fair value of $178,045 as stock based compensation expense in the statement of operations for the year ended December 31, 2011 (December 31, 2010 - $432,395) in respect of those shares released from escrow. 850,000 shares were released from escrow for the year ending December 31, 2010.

ii)	22,000,011 (December 31, 2010: 11,155,165) common shares are held in escrow under a pooling agreement and are subject to a timed release schedule under which:

	a)	15% will be released on the first day of the Company’s fiscal quarter beginning after the one year anniversary of the share exchange (the “First Quarter”);

	b)	15% will be released on the first day of each of the Company’s next five fiscal quarters after the First Quarter;

	c)	the remaining 10% will be released on the first day of the ninth fiscal quarter after the First Quarter.

		As the release of these shares is certain, they have been included in the calculation of loss per share. At December 31, 2011, no shares have been released from escrow.

F-25

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

9.	Related Party Transactions Related party balances

	The following amounts due to related parties are included in trade payables and accrued liabilities:

		December 31, 2011		December 31, 2010
Companies controlled by directors of the Company	$	10,000	$	33,856
Directors or officers of the Company		9,596		43,080
	$	19,596	$	76,936

These amounts are unsecured, non-interest bearing and have no fixed terms of repayment.

Related party transactions

		December 31, 2011		December 31, 2010
Research and development consulting fees	$	135,044	$	144,100
Clinical trial costs		103,563		-
Administrative consulting fees		45,750		116,475
Rent		9,000		15,000
Legal fees		6,621		39,326
	$	299,977	$	314,901

Key management compensation

		December 31, 2011		December 31, 2010
Short-term employee benefits – salaries and wages	$	425,209	$	30,000
Stock-based compensation		313,665		432,395
	$	738,874	$	462,395

F-26

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

10.

Income Taxes

Reconciliation of accounting and taxable income, for the years ended December 31 are as follows:

		2011			2010

Net loss for the year before taxes	$	(3,713,439	)	$	(2,542,525	)
Combined federal and provincial income tax rate		26.50%			31.00%
Expected income tax expense (recovery)		(984,000	)		(788,000	)
Increase (decrease) resulting from
Income taxed at reduced rate		-			280,000
Non-deductible items		253,000			335,000
Tax adjustment from rate change and other		23,000			(158,000	)
Change in unrecognized deferred tax assets		708,000			331,000
	$	-		$	-

		Effective January 1, 2011, the Canadian Federal corporate tax rate decreased from 18% to 16.5%. Due to the change in reporting jurisdiction in 2011, the British Columbia provincial tax rate of 10% was used. In 2010, the Ontario rate of 13% was used.

	b)	The components of the deferred tax asset (liability) balances for the years ended December 31, are as follows:

		2011			2010

Deferred tax assets
Non-capital losses	$	1,112,000		$	446,000
Equipment and other		63,000			18,000
Temporary differences relating to intellectual property costs		17,000			20,000
Unrecognized deferred tax assets		(1,192,000	)		(484,000	)
	$	-		$	-

Deferred tax assets in respect of losses and other temporary differences are recognized when it is more likely than not, that they will be recovered against profits in future periods. No deferred tax asset has been recognized as this criteria has not been met.

At December 31, 2011, the Company has non capital losses totalling approximately $4,397,600 that will expire beginning in 2026:

Year of Expiry		Amount

2026	$	5,500
2027		16,200
2028		533,200
2029		1,169,400
2031		2,673,300
	$	4,397,600

F-27

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

11.	Commitments

	The Company has entered into contractual commitments set to expire as follows:

Within 1 year	$	279,306	$	442,055
Within 2 years	$	-	$	226,977
Totals	$	279,306	$	669,032

12.	Financial Instruments and Risk Management

	As at December 31, 2011, the Company’s financial instruments are comprised of cash, accounts payable and accrued liabilities and advances payable.

	The fair values of cash, accounts payable and accrued liabilities and advances payable approximate their carrying value due to their short-term maturity.

	The Company is exposed through its operations to the following financial risks:

	•	Currency risk
	•	Credit risk
	•	Liquidity risk
	•	Interest rate risk

In common with all other businesses, the Company is exposed to risks that arise from its use of financial instruments. This note describes the Company’s objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

There have been no substantive changes in the Company’s exposure to financial instrument risks, its objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company has an exposure to the European Euros as certain expenditures and commitments are denominated in European Euros and the Company is subject to fluctuations as a result of exchange rate variations to the extent that transactions are made in this currency. In addition, the Company holds a significant amount of cash in US dollars and is therefore exposed to exchange rate fluctuations on these cash balances. The Company does not hedge its foreign exchange risk. At December 31, 2011 the Company held cash balances of $302,611 US (December 31, 2010: Nil). A 1% increase/decrease in the USD foreign exchange rate would have an impact of ±$3,026 on the cash balance held at December 31, 2011.

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company’s credit risk is primarily attributable to its cash. The Company limits exposure to credit risk by maintaining its cash with large financial institutions. The Company’s maximum exposure to credit risk is the carrying value of its financial assets.

F-28

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

12.	Financial Instruments and Risk Management – Continued

	Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company manages liquidity risk through the management of its capital structure, more specifically, the issuance of new common shares, to ensure there is sufficient capital in order to meet short term business requirements, after taking into account the Company’s holdings of cash and potential equity financing opportunities. The Company believes that these sources will be sufficient to cover the known short and long-term requirements at this time. There is no assurance that potential equity financing opportunities will be available to meet these obligations.

	The following table sets out the contractual maturities (representing undiscounted contractual cash-flows) of financial liabilities as at December 31, 2011:

		Accounts payable and
Year of expiry		accrued liabilities		Advances payable		Total

Within 1 year	$	153,694	$	76,275	$	229,969

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. As the Company’s cash is currently held in an interest bearing bank account, management considers the interest rate risk to be limited. Advances payable are non-interest bearing and therefore are not subject to interest rate risk.

Classification of financial instruments

Financial assets included in the statement of financial position are as follows:

			December 31,		December 31,
	Classification		2011		2010

Cash	Loans and receivables	$	565,143	$	1,211,525
		$	565,143	$	1,211,525

Financial liabilities included in the statement of financial position are as follows:

			December 31,		December 31,
	Classification		2011		2010
Non-derivative financial liabilities:
Accounts payable and accrued liabilities	Financial liabilities	$	153,694	$	548,280
Advance payable	at amortized cost		76,275		75,015
		$	229,969	$	623,295

F-29

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

13.	Capital Management

	The Company’s objective when managing capital is to safeguard the Company’s ability to continue as a going concern in order to pursue business opportunities. In order to facilitate the management of its capital requirements, the Company prepares periodic budgets that are updated as necessary. The Company manages its capital structure and makes adjustments to it to effectively support the Company’s objectives. In order to pay for general administrative costs, the Company will use its existing working capital and raise additional amounts as needed. The Company will continue to advance its technology.

	Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. The Company considers shareholders equity and working capital as components of its capital base. The Company can access or increase capital through the issuance of shares, and by sustaining cash reserves by reducing its capital and operational expenditure program. Management primarily funds the Company’s expenditures by issuing share capital, rather than using capital sources that require fixed repayments of principal and/or interest. The Company is not subject to externally imposed capital requirements and does not have exposure to asset-backed commercial paper or similar products. The Company believes it will be able to raise additional equity capital as required, but recognizes the uncertainty attached thereto.

	The Company’s investment policy is to hold cash in interest bearing bank accounts, which pay comparable interest rates to highly liquid short-term interest bearing investments with maturities of one year or less and which can be liquidated at any time without penalties.

	There has been no change in the Company’s approach to capital management during the year ended December 31, 2011.

14.	Non-cash Transactions

	Investing and financing activities that do not have a direct impact on current cash flows are excluded from the consolidated statements of cash flow. During the year ended December 31, 2011, the Company acquired 4,724,800 common shares of TrichoScience in exchange for 10,844,848 common shares, 5,422,420 Series B Preferred Shares and 5,422,420 Series C Preferred Shares of the Company, which was excluded from the consolidated statement of cash flows for $262,000. (December 31 2010: $Nil). During the year-ended December 31, 2011, 13,000,000 of the Company’s Class C preferred shares (each, a “Class C Share”), were converted, on a 5:1 ratio, into 2,600,000 common shares of the Company (each, a “Common Share”) by the holders thereof.

15.	Segmental Reporting

	The Company is organized into one business unit based on its hair cell replication technology and has one reportable operating segment.

F-30

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

16.	First Time Adoption of International Financial Reporting Standards

	The Company’s financial statements for the year-ended December 31, 2011 are the first annual financial statements that have been prepared in accordance with IFRS. IFRS 1, First Time Adoption of International Financial Reporting Standards (“IFRS 1”), requires that comparative financial information be provided. As a result, the first date at which the Company has applied IFRS was January 1, 2010 (the “Transition Date”). IFRS 1 requires first-time adopters to retrospectively apply all effective IFRS standards as of the reporting date, which for the Company will be December 31, 2011. Therefore, the financial statements for the year-ending December 31, 2011, the comparative information presented in these financial statements for the year-ended December 31, 2010 and the opening IFRS statement of financial position at January 1, 2010 are prepared in accordance with IFRS standards effective at the reporting date. However, IFRS 1 also provides for certain optional exemptions and certain mandatory exceptions for first time IFRS adopters. Prior to transition to IFRS, the Company prepared its financial statements in accordance with pre-changeover Canadian Generally Accepted Accounting Principles (“pre-changeover Canadian GAAP”).

	In preparing the Company’s opening IFRS financial statements, the Company has adjusted amounts reported previously in the financial statements prepared in accordance with pre-changeover Canadian GAAP. An explanation of how the transition from pre-changeover Canadian GAAP to IFRS has affected the Company’s financial position and financial performance is set out in the following tables and notes:

	*Optional Exemptions*

	Business Combinations

	The Company elected to not retrospectively apply IFRS 3 Business Combinations to any business combinations that may have occurred prior to its Transition Date and such business combinations have been restated.

	Share-based Payment Transactions

	The Company has elected not to retrospectively apply IFRS 2 to equity instruments that were granted and had vested before the Transition Date. As a result of applying this exemption, the Company will apply the provisions of IFRS 2 only to all outstanding equity instruments that are unvested as at the Transition Date to IFRS.

	*Mandatory Exceptions*

	De-recognition of Financial Assets and Liabilities

	The Company has applied the de-recognition requirements in IAS 39 Financial Instruments: Recognition and Measurement prospectively from the Transition Date. As a result any non-derivative financial assets or non-derivative financial liabilities derecognized prior to the Transition Date in accordance with pre-changeover Canadian GAAP have not been reviewed for compliance with IAS 39.

	Estimates

	The estimates previously made by the Company under pre-changeover Canadian GAAP were not revised for the application of IFRS except where necessary to reflect any difference in accounting policy or where there was objective evidence that those estimates were in error. As a result the Company has not used hindsight to revise estimates.

	Reconciliations of Pre-changeover Canadian GAAP Equity and Comprehensive Income to IFRS

	IFRS 1 requires an entity to reconcile equity, comprehensive income and cash flows for prior periods. The changes made to the statements of financial position and statements of comprehensive income as shown below have resulted in reclassifications of various amounts on the statements of cash flows, resulting in an increase of $53,429 to the cash flows provided from financing activities with a corresponding decrease to operating cash flows. There have been no adjustments to the decrease in cash for the period. As such no reconciliation of the statement of cash flows has been prepared.

F-31

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

Reconciliation of Statement of Financial Position

			As at December 31, 2010									As at January 1, 2010
			Canadian			Effect of						Canadian			Effect of
	Notes		GAAP			Transition			IFRS			GAAP			Transition		IFRS

Assets

Current assets
Cash		$	1,211,525		$	-		$	1,211,525		$	603,907		$	-	$	603,907
Sales tax recoverable			40,877			-			40,877			-			-		-
Prepaid expenses			23,592			-			23,592			21,320			-		21,320

			1,275,994			-			1,275,994			625,227			-		625,227
Non-current assets
Equipment			32,748			-			32,748			19,239			-		19,239
Total assets		$	1,308,742		$	-		$	1,308,742		$	644,466		$	-	$	644,466


Liabilities and shareholders’ equity

Current liabilities
Accounts payable and accrued liabilities		$	548,280		$	-		$	548,280		$	87,423		$	-	$	87,423
Advances payable			75,015			-			75,015			-			-		-
Total liabilities			623,295			-			623,295			87,423			-		87,423

Non-controlling interest	16 (a)		327,640			(327,640	)		-			-			-		-
Shareholders’ equity
Common shares	16 (a)(b)		2,312,152			1,032,168			3,344,320			1,154,800			-		1,154,800
Preferred shares			204			-			204			-			-		-
Share subscriptions			-			-			-			17,500			-		17,500
Contributed surplus	16 (a)		129,635			106,070			235,705			-			-		-
Deficit	16 (a)(b)		(2,084,184	)		(1,135,598	)		(3,219,782	)		(615,257	)		-		(615,257	)
Attributable to owners’ of the parent			357,807			-			360,447			557,043			-		557,043
Attributable to the non-controlling interest			-			325,000			325,000			-			-		-
Total shareholders’ equity			357,807			-			685,447			557,043			-		557,043

Total liabilities and shareholders’ equity		$	1,308,742		$	-		$	1,308,742		$	644,466		$		$	644,466

F-32

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

Reconciliation of the Statement of Comprehensive Loss for the Year Ended December 31, 2010

			Canadian			Effect of
	Notes		GAAP			Transition			IFRS

Clinical Development
Clinical trials		$	367,763		$	-		$	367,763

Research and Development
Consulting fees			132,100			-			132,100
Intellectual property costs			50,386			-			50,386

Sales and Marketing
Professional fees			57,353			-			57,353

General and Administrative
Amortization			6,940			-			6,940
Accounting and audit fees	16 (b)		53,792			27,664			81,456
Computer and IT expenses			21,638			-			21,638
Legal fees	16 (b)		91,190			25,764			116,954
Listing expense	16 (b)		-			85,000			85,000
Consulting fees			198,196			-			198,196
Insurance			30,472			-			30,472
Office and telephone			29,556			-			29,556
Rent			26,916			-			26,916
Salaries			109,830			-			109,830
Stock-based compensation			1,176,900			-			1,176,900
Travel and promotion			51,065			-			51,065
Foreign exchange loss			-			-			-
Net Comprehensive loss		$	(2,404,097	)	$	(138,428	)	$	(2,542,525	)

Basic and diluted loss per share		$	(0.11	)	$	(0.01	)	$	(0.12	)

Reconciliation of equity

			December 31,		January 1,
	Notes		2010		2010
Equity previously reported under Canadian GAAP		$	357,807	$	557,043

Adjustment upon adoption of IFRS:
Difference due to the reversal of the recognition of the non-controlling interest.	16 (a)		327,640		-
Total Equity reported under IFRS		$	685,447	$	557,043

F-33

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

16.

First Time Adoption of International Financial Reporting Standards - Continued

Notes to reconciliations

	a)	Under Canadian GAAP, non-controlling interest was presented between liabilities and equity on the statement of financial position, distinct from shareholders’ equity. Under IFRS, non-controlling interest is included as a component of shareholders equity. As a result the non-controlling interest was reduced by $327,640 with an increase to common shares of $1,156,740, contributed surplus $106,070, and an increase to deficit of $935,170. An adjustment of $2,640 of share issue costs was attributed to the non-controlling interest’s share of the net deficit of Trichoscience on transition to IFRS (note 16(b) and note 5).

		None of these items affected the transition date balance sheet.

	b)	Canadian GAAP included specific guidance on reverse take-over transactions, and required that the fair value of the net assets acquired to be credited to common stock ($1,073,226), net liabilities acquired to be attributed to retained earnings ($3,925), and share issue costs to be treated as a reduction to common stock ($130,329).

		Under IFRS, TrichoScience is deemed to have issued shares in exchange for the net assets of RepliCel together with the listing status of RepliCel. The Company recognized a listing expense in association with the reverse take-over transaction. The transaction has been accounted for as an asset acquisition in TrichoScience for share consideration under IFRS 2. Under IFRS the fair value of Trichoscience acquired by RepliCel was calculated to be $818,325.

		IFRS 2 requires the reverse takeover to be treated as a share based payment transaction with the recognition of the listing expense as an unidentifiable good/service. IFRS 2.13A requires the Company to measure this unidentifiable good/service as the difference between the fair value of the share based payment made and the fair value of the net identifiable assets received. The full fair value of the net assets received was determined to be $996,400 and the consideration given by TrichoScience had 100% of the shares been acquired was calculated as $1,080,970, giving rise to a listing expense of $85,000 which is recognized in net loss for the year ended December 31, 2010.

		The Company also recognized a charge to deficit of $62,000, being the adjustment to reflect the difference in the fair value of the consideration granted in the reverse take-over arising from Investment One ($1,000,000) by the Company for newly issued common shares of TrichoScience as required by IAS 27.30-31. The non-controlling interest was adjusted to reflect the 44.6% of the net assets of Trichoscience, held by investors other than the Company immediately after investment one, to be $325,000 (note 5).

		Under Canadian GAAP, deferred acquisition costs of $130,328 associated with the reverse take-over transaction were debited to common shares. Of this total, $76,900 was incurred by RepliCel pre-reverse takeover and therefore is not reflected in the consolidated statement of loss and comprehensive loss. Under IFRS, the Company is required to expense $27,664 to accounting and audit fees and $25,764 to legal fees in the period in which they were incurred, with a $53,428 increase to the net loss for the year. The reverse take-over transaction is fully described in note 5.

		The impact on the financial statements for the year ended December 31, 2010 was to reduce common shares by $124,572, increase accumulated deficit by $200,428 and recognize a non-controlling interest within shareholders’ equity equal to $325,000.

		As a result of the listing expense ($85,000) and the requirement to expense the legal fees ($25,764) and accounting and audit fees ($25,764) in the period they were incurred, the Company’s net loss for the year ended December 31, 2010 increased by $138,428 to $2,542,525.

		None of these items affected the transition date balance sheet.

F-34

REPLICEL LIFE SCIENCES INC. (formerly NEWCASTLE RESOURCES LTD.)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year-ended December 31, 2011

(Stated in Canadian Dollars)

17.	Events After the Reporting Date

	The Company granted 100,000 options to a consultant of the Company. The options are exercisable at US$2.35 per share until January 3, 2019. The options vest according to specific milestones.

	The Company granted 790,000 options to employees and consultants to the Company. The options vest over a period of three years and are exercisable at US$1.50 per share until April 18, 2019.

	The Company completed a private placement (the “Financing”) of 1,875,046 units at US$1.50 per unit for proceeds of $2,796,740 (US$2,812,570). Each unit issued consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase an additional common share at US$2.50 per share for a period of 24 months from the closing of the Financing. A finder’s fee of $36,000 was issued in connection with the Financing. As a result of the Financing, pursuant to Note 5), the performance condition with respect to 500,000 shares held in escrow had been achieved; as a result these shares have been released from escrow.

F-35

ITEM 18. Financial Statements

Refer to Item 17 - Financial Statements

ITEM 19. Exhibits

The following exhibits are being filed as part of this annual report, or are incorporated by reference where indicated:

(1)	Articles of Incorporation and By-laws

1.1*	Certificate of Continuation dated June 22, 2011

1.2*	Articles adopted on May 10, 2011

1.3*	Notice of Articles dated December 5, 2011

(4)	Material Contracts

4.1	Share Exchange Agreement dated October 29, 2010 with TrichoScience Innovations Inc. and the shareholders of TrichoScience Innovations Inc. (incorporated by reference from our Shell Company Report on Form 20-F, filed on December 27, 2010).

4.2	Pooling Agreement dated December 22, 2010 (incorporated by reference from our Shell Company Report on Form 20-F, filed on December 27, 2010).

4.3	Share Exchange Agreement dated October 29, 2010 with 583885 B.C. Ltd. and the shareholders of 583885 B.C. Ltd. (incorporated by reference from our Shell Company Report on Form 20-F, filed on December 27, 2010).

4.4	Escrow Agreement dated December 22, 2010 (incorporated by reference from our Shell Company Report on Form 20-F, filed on December 27, 2010).

4.5	Corporate Consulting Services Agreement dated June 1, 2010 among TrichoScience Innovations Inc. and 583885 B.C. Ltd. (incorporated by reference from our Shell Company Report on Form 20-F, filed on December 27, 2010).

(8)	List of Significant Subsidiaries

8.1	TrichoScience Innovations Inc., a company incorporated under the federal laws of Canada, all of the shares of which are beneficially owned by our company.

(11)	Code of Ethics

11.1	Code of Ethics (incorporated by reference from our Registration Statement on Form 20-F, as amended, filed on July 15, 2004).

(12)	302 Certification

12.1*	Section 302 Certification under Sarbanes-Oxley Act of 2002 for David Hall

12.2*	Section 302 Certification under Sarbanes-Oxley Act of 2002 for Tom Kordyback

12.3*	Section 906 Certification under Sarbanes-Oxley Act of 2002 for David Hall.

12.4*	Section 906 Certification under Sarbanes-Oxley Act of 2002 for Tom Kordyback.

* Filed herewith

SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

REPLICEL LIFE SCIENCES INC.

Per:	/s/ David Hall
	David Hall
	Chief Executive Officer, President and Director

Dated:	April 26, 2012


Per:	/s/ Tom Kordyback
	Tom Kordyback
	Chief Financial Officer

Dated:	April 26, 2012

Incorporation No. C0913693

BUSINESS CORPORATIONS ACT

ARTICLES

REPLICEL LIFE SCIENCES INC.

Table of Cont ents

Part 1 - Interpretation	1

Part 2 - Shares and Share certificates	2

Part 3 - Issue of Shares	2

Part 4 - Share Transfers	3

Part 5 - Acquisition of Shares	3

Part 6 - Borrowing Powers	4

Part 7 - General Meetings	4

Part 8 - Proceedings at Meetings of Shareholders	5

Part 9 - Alterations	8

Part 10 - Votes of Shareholders	9

Part 11 - Directors	12

Part 12 - Election and Removal of Directors	13

Part 13 - Proceedings of Directors	14

Part 14 - Committees of Directors	16

Part 15 - Officers	17

Part 16 - Certain Permitted Activities of Directors	17

Part 17 - Indemnification	18

Part 18 - Auditor	18

Part 19 - Dividends	18

Part 20 - Accounting Records	19

Part 21 - Execution of Instruments	19

Part 22 - Notices	20

Part 23 - Restriction on Share Transfer	21

Part 24 - Special Rights and Restrictions	21

Incorporation No. C0913693

BUSINESS CORPORATIONS ACT

ARTICLES

REPLICEL LIFE SCIENCES INC.

PART 1– INTERPRETATION

1.1	Definitions

	Without limiting Article 1.2, in these Articles, unless the context requires otherwise:

“adjourned meeting” means the meeting to which a meeting is adjourned under Article 8.6 or 8.9;

“board” and “directors” mean the board of directors of the Company for the time being;

“ Business Corporations Act ” means the Business Corporations Act , S.B.C. 2002, c.57, and includes its regulations;

“Company” means RepliCel Life Sciences Inc.;

“ Interpretation Act ” means the Interpretation Act , R.S.B.C. 1996, c. 238;

“trustee”, in relation to a shareholder, means the personal or other legal representative of the shareholder, and includes a trustee in bankruptcy of the shareholder.

1.2	Business Corporations Act definitions apply

	The definitions in the Business Corporations Act apply to these Articles.

1.3	Interpretation Act applies

	The Interpretation Act applies to the interpretation of these Articles as if these Articles were an enactment.

1.4	Conflict in definitions

	If there is a conflict between a definition in the Business Corporations Act and a definition or rule in the Interpretation Act relating to a term used in these Articles, the definition in the Business Corporations Act will prevail in relation to the use of the term in these Articles.

1.5	Conflict between Articles and legislation

	If there is a conflict between these Articles and the Business Corporations Act , the Business Corporations Act will prevail.

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PART 2 – SHARES AND SHARE CERTIFICATES

2.1	Form of share certificate

	Each share certificate issued by the Company must comply with, and be signed as required by, the Business Corporations Act .

2.2	Shareholder Entitled to Certificate or Acknowledgement

	Each shareholder is entitled, without charge, to (a) one share certificate representing the shares of each class or series of shares registered in the shareholder’s name or (b) a non-transferable written acknowledgement of the shareholder’s right to obtain such a share certificate, provided that in respect of a share held jointly by several persons, the Company is not bound to issue more than one share certificate and delivery of a share certificate for a share to one of several joint shareholders or to one of the shareholders’ duly authorized agents will be sufficient delivery to all.

2.3	Sending of share certificate

	Any share certificate to which a shareholder is entitled may be sent to the shareholder by mail and neither the Company nor any agent is liable for any loss to the shareholder because the certificate sent is lost in the mail or stolen.

2.4	Replacement of worn out or defaced certificate

	If the directors are satisfied that a share certificate is worn out or defaced, they must, on production to them of the certificate and on such other terms, if any, as they think fit,

	(a)	order the certificate to be cancelled, and

	(b)	issue a replacement share certificate.

2.5	Replacement of lost, stolen or destroyed certificate

	If a share certificate is lost, stolen or destroyed, a replacement share certificate must be issued to the person entitled to that certificate if the directors receive

	(a)	proof satisfactory to them that the certificate is lost, stolen or destroyed, and

	(b)	any indemnity the directors consider adequate.

2.6	Splitting share certificates

	If a shareholder surrenders a share certificate to the Company with a written request that the Company issue in the shareholder’s name 2 or more certificates, each representing a specified number of shares and in the aggregate representing the same number of shares as the certificate so surrendered, the Company must cancel the surrendered certificate and issue replacement share certificates in accordance with that request.

2.7	Shares may be uncertificated

	Notwithstanding any other provisions of this Part, the directors may, by resolution, provide that:

	(a)	the shares of any or all of the classes and series of the Company’s shares must be uncertificated shares; or

	(b)	any specified shares must be uncertificated shares.

PART 3 – ISSUE OF SHARES

3.1	Directors authorized to issue shares

	The directors may, subject to the rights of the holders of the issued shares of the Company, issue, allot, sell, grant options on or otherwise dispose of the unissued shares, and issued shares held by the Company, at the times, to the persons, including directors, in the manner, on the terms and conditions and for the issue prices that the directors, in their absolute discretion, may determine.

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3.2	Company need not recognize unregistered interests

	Except as required by law or these Articles, the Company need not recognize or provide for any person’s interests in or rights to a share unless that person is the shareholder of the share.

PART 4 – SHARE TRANSFERS

4.1	Recording or registering transfer

	A transfer of a share of the Company must not be registered

	(a)	unless a duly signed instrument of transfer in respect of the share has been received by the Company and the certificate (or acceptable documents pursuant to Article 2.5 hereof) representing the share to be transferred has been surrendered and cancelled, or

	(b)	if no certificate has been issued by the Company in respect of the share, unless a duly signed instrument of transfer in respect of the share has been received by the Company.

4.2	Form of instrument of transfer

	The instrument of transfer in respect of any share of the Company must be either in the form, if any, on the back of the Company’s share certificates or in any other form that may be approved by the directors from time to time.

4.3	Signing of instrument of transfer

	If a shareholder, or his or her duly authorized attorney, signs an instrument of transfer in respect of shares registered in the name of the shareholder, the signed instrument of transfer constitutes a complete and sufficient authority to the Company and its directors, officers and agents to register the number of shares specified in the instrument of transfer, or, if no number is specified, all the shares represented by share certificates deposited with the instrument of transfer,

	(a)	in the name of the person named as transferee in that instrument of transfer, or

	(b)	if no person is named as transferee in that instrument of transfer, in the name of the person on whose behalf the share certificate is deposited for the purpose of having the transfer registered.

4.4	Enquiry as to title not required

	Neither the Company nor any director, officer or agent of the Company is bound to inquire into the title of the person named in the instrument of transfer as transferee or, if no person is named as transferee in the instrument of transfer, of the person on whose behalf the instrument is deposited for the purpose of having the transfer registered or is liable for any claim related to registering the transfer by the shareholder or by any intermediate owner or holder of the shares, of any interest in the shares, of any share certificate representing such shares or of any written acknowledgment of a right to obtain a share certificate for such shares.

4.5	Transfer fee

	There must be paid to the Company, in relation to the registration of any transfer, the amount determined by the directors from time to time.

PART 5 – ACQUISITION OF SHARES

5.1	Company authorized to purchase shares

	Subject to the special rights and restrictions attached to any class or series of shares, the Company may, if it is authorized to do so by the directors, purchase or otherwise acquire any of its shares.

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5.2	Company authorized to accept surrender of shares

	The Company may, if it is authorized to do so by the directors, accept a surrender of any of its shares.

5.3	Company authorized to convert fractional shares into whole shares

	The Company may, if it is authorized to do so by the directors, convert any of its fractional shares into whole shares in accordance with, and subject to the limitations contained in, the Business Corporations Act .

PART 6 – BORROWING POWERS

6.1	Powers of directors

	The directors may from time to time on behalf of the Company

	(a)	borrow money in the manner and amount, on the security, from the sources and on the terms and conditions that they consider appropriate,

	(b)	issue bonds, debentures and other debt obligations either outright or as security for any liability or obligation of the Company or any other person, and at any discount or premium and on such other terms as they consider appropriate,

	(c)	guarantee the repayment of money by any other person or the performance of any obligation of any other person, and

	(d)	mortgage or charge, whether by way of specific or floating charge, or give other security on the whole or any part of the present and future assets and undertaking of the Company.

PART 7 – GENERAL MEETINGS

7.1	Annual general meetings

	Unless an annual general meeting is deferred or waived in accordance with section 182(2)(a) or (c) of the Business Corporations Act , the Company must hold its first annual general meeting within 18 months after the date on which it was incorporated or otherwise recognized, and after that must hold an annual general meeting at least once in each calendar year and not more than 15 months after the last annual general meeting.

7.2	When annual general meeting is deemed to have been held

	If all of the shareholders who are entitled to vote at an annual general meeting consent by a unanimous resolution under the Business Corporations Act to all of the business that is required to be transacted at that annual general meeting, the annual general meeting is deemed to have been held on the date of the unanimous resolution. The shareholders must, in any unanimous resolution passed under this Article 7.2, select as the Company’s annual reference date a date that would be appropriate for the holding of the applicable annual general meeting.

7.3	Calling of shareholder meetings

	The directors may, whenever they think fit, call a meeting of shareholders.

7.4	Notice for meetings of shareholders

	The Company must send notice of the date, time and location of any meeting of shareholders, in the manner provided in these Articles, or in such other manner, if any, as may be prescribed by ordinary resolution (whether previous notice of the resolution has been given or not), to each shareholder entitled to attend the meeting and to each director, unless these Articles otherwise provide, at least the following number of days before the meeting:

(a)

if and for so long as the Company is a public company, 21 days;

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(b)

otherwise, 10 days.

7.5	Record date for notice

	The directors may set a date as the record date for the purpose of determining shareholders entitled to notice of any meeting of shareholders. The record date must not precede the date on which the meeting is to be held by more than two months or, in the case of a general meeting requisitioned by shareholders under the Business Corporations Act , by more than four months. The record date must not precede the date on which the meeting is held by fewer than:

	(a)	if and for so long as the Company is a public company, 21 days;

	(b)	otherwise, 10 days.

	If no record date is set, the record date is 5 p.m. on the day immediately preceding the first date on which the notice is sent or, if no notice is sent, the beginning of the meeting.

7.6	Record date for voting

	The directors may set a date as the record date for the purpose of determining shareholders entitled to vote at any meeting of shareholders. The record date must not precede the date on which the meeting is to be held by more than two months or, in the case of a general meeting requisitioned by shareholders under the Business Corporations Act , by more than four months. If no record date is set, the record date is 5 p.m. on the day immediately preceding the first date on which the notice is sent or, if no notice is sent, the beginning of the meeting.

7.7	Failure to give notice and waiver of notice

	The accidental omission to send notice of any meeting to, or the non-receipt of any notice by, any of the persons entitled to notice does not invalidate any proceedings at that meeting. Any person entitled to notice of a meeting of shareholders may, in writing or otherwise, waive or reduce the period of notice of such meeting.

7.8	Notice of special business at meetings of shareholders

	If a meeting of shareholders is to consider special business within the meaning of Article 8.1, the notice of meeting must:

	(a)	state the general nature of the special business; and

	(b)	if the special business includes considering, approving, ratifying, adopting or authorizing any document or the signing of or giving of effect to any document, have attached to it a copy of the document or state that a copy of the document will be available for inspection by shareholders:

		(i)	at the Company’s records office, or at such other reasonably accessible location in British Columbia as is specified in the notice; and

		(ii)	during statutory business hours on any one or more specified days before the day set for the holding of the meeting.

PART 8 – PROCEEDINGS AT MEETINGS OF SHAREHOLDERS

8.1	Special business

	At a meeting of shareholders, the following business is special business:

	(a)	at a meeting of shareholders that is not an annual general meeting, all business is special business except business relating to the conduct of or voting at the meeting or the election or appointment of directors;

	(b)	at an annual general meeting, all business is special business except for the following:

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	(i)	business relating to the conduct of or voting at the meeting;

	(ii)	consideration of any financial statements of the Company presented to the meeting;

	(iii)	consideration of any reports of the directors or auditor;

	(iv)	the setting or changing of the number of directors;

	(v)	the election or appointment of directors;

	(vi)	the appointment of an auditor;

	(vii)	the setting of the remuneration of an auditor;

	(viii)	business arising out of a report of the directors not requiring the passing of a special resolution or an exceptional resolution;

	(ix)	any other business which, under these Articles or the Business Corporations Act , may be transacted at a meeting of shareholders without prior notice of the business being given to the shareholders.

8.2	Special resolution

	The votes required for the Company to pass a special resolution at a meeting of shareholders is two-thirds of the votes cast on the resolution.

8.3	Quorum

	Subject to the special rights and restrictions attached to the shares of any class or series of shares, the quorum for the transaction of business at a meeting of shareholders is 2 persons who are, or who represent by proxy, shareholders who, in the aggregate, hold at least 1/20 of the issued shares entitled to be voted at the meeting.

8.4	Other persons may attend

	The directors, the president, if any, the secretary, if any, and any lawyer or auditor for the Company are entitled to attend any meeting of shareholders, but if any of those persons do attend a meeting of shareholders, that person is not to be counted in the quorum, and is not entitled to vote at the meeting, unless that person is a shareholder or proxy holder entitled to vote at the meeting.

8.5	Requirement of quorum

	No business, other than the election of a chair of the meeting and the adjournment of the meeting, may be transacted at any meeting of shareholders unless a quorum of shareholders entitled to vote at the meeting is present at the commencement of the meeting.

8.6	Lack of quorum

	If, within 1/2 hour from the time set for the holding of a meeting of shareholders, a quorum is not present,

	(a)	in the case of a general meeting convened by requisition of shareholders, the meeting is dissolved, and

	(b)	in the case of any other meeting of shareholders, the shareholders entitled to vote at the meeting who are present, in person or by proxy, at the meeting may adjourn the meeting to a set time and place.

8.7	Chair

	The following individual is entitled to preside as chair at a meeting of shareholders:

(a)

the chair of the board, if any;

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(b)

if the chair of the board is absent or unwilling to act as chair of the meeting, the president, if any.

8.8	Alternate chair

	At any meeting of shareholders, the directors present must choose one of their number to be chair of the meeting if: (a) there is no chair of the board or president present within 15 minutes after the time set for holding the meeting; (b) the chair of the board and the president are unwilling to act as chair of the meeting; or (c) if the chair of the board and the president have advised the secretary, if any, or any director present at the meeting, that they will not be present at the meeting. If, in any of the foregoing circumstances, all of the directors present decline to accept the position of chair or fail to choose one of their number to be chair of the meeting, or if no director is present, the shareholders present in person or by proxy must choose any person present at the meeting to chair the meeting.

8.9	Adjournments

	The chair of a meeting of shareholders may, and if so directed by the meeting must, adjourn the meeting from time to time and from place to place, but no business may be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.

8.10	Notice of adjourned meeting

	It is not necessary to give any notice of an adjourned meeting or of the business to be transacted at an adjourned meeting of shareholders except that, when a meeting is adjourned for 30 days or more, notice of the adjourned meeting must be given as in the case of the original meeting.

8.11	Motion need not be seconded

	No motion proposed at a meeting of shareholders need be seconded unless the chair of the meeting rules otherwise, and the chair of any meeting of shareholders is entitled to propose or second a motion.

8.12	Manner of taking a poll

	Subject to Article 8.13, if a poll is duly demanded at a meeting of shareholders,

	(a)	the poll must be taken

		(i)	at the meeting, or within 7 days after the date of the meeting, as the chair of the meeting directs, and

		(ii)	in the manner, at the time and at the place that the chair of the meeting directs,

	(b)	the result of the poll is deemed to be a resolution of, and passed at, the meeting at which the poll is demanded, and

	(c)	the demand for the poll may be withdrawn.

8.13	Demand for a poll on adjournment

	A poll demanded at a meeting of shareholders on a question of adjournment must be taken immediately at the meeting.

8.14	Demand for a poll not to prevent continuation of meeting

	The demand for a poll at a meeting of shareholders does not, unless the chair of the meeting so rules, prevent the continuation of a meeting for the transaction of any business other than the question on which a poll has been demanded.

8.15	Poll not available in respect of election of chair

	No poll may be demanded in respect of the vote by which a chair of a meeting of shareholders is elected.

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8.16	Casting of votes on poll

	On a poll, a shareholder entitled to more than one vote need not cast all the votes in the same way.

8.17	Chair must resolve dispute

	In the case of any dispute as to the admission or rejection of a vote given on a poll, the chair of the meeting must determine the same, and his or her determination made in good faith is final and conclusive.

8.18	Chair has no second vote

	In case of an equality of votes, the chair of a meeting of shareholders does not, either on a show of hands or on a poll, have a casting or second vote in addition to the vote or votes to which the chair may be entitled as a shareholder.

8.19	Declaration of result

	The chair of a meeting of shareholders must declare to the meeting the decision on every question in accordance with the result of the show of hands or the poll, as the case may be, and that decision must be entered in the minutes of the meeting.

8.20	Meetings by telephone or other communications medium

	A shareholder or proxy holder who is entitled to participate in a meeting of shareholders may do so in person, or by telephone or other communications medium, if all shareholders and proxy holders participating in the meeting are able to communicate with each other; provided, however, that nothing in this Section shall obligate the Company to take any action or provide any facility to permit or facilitate the use of any communications medium at a meeting of shareholders. If one or more shareholders or proxy holders participate in a meeting of shareholders in a manner contemplated by this Section 8.20,

	(a)	each such shareholder or proxy holder shall be deemed to be present at the meeting, and

	(b)	the meeting shall be deemed to be held at the location specified in the notice of the meeting.

PART 9 – ALTERATIONS

9.1	Alteration of Authorized Share Structure

	Subject to Article 9.2 and the Business Corporations Act , the Company may by resolution of the directors:

(a)	create one or more classes or series of shares or, if none of the shares of a class or series of shares are allotted or issued, eliminate that class or series of shares;

(b)	increase, reduce or eliminate the maximum number of shares that the Company is authorized to issue out of any class or series of shares or establish a maximum number of shares that the Company is authorized to issue out of any class or series of shares for which no maximum is established;

(c)	if the Company is authorized to issue shares of a class of shares with par value:

	(i)	decrease the par value of those shares,

	(ii)	if none of the shares of that class of shares are allotted or issued, increase the par value of those shares,

	(iii)	subdivide all or any of its unissued or fully paid issued shares with par value into shares of smaller par value, or

	(iv)	consolidate all or any of its unissued or fully paid issued shares with par value into shares of larger par value;

(d)	subdivide all or any of its unissued or fully paid issued shares without par value;

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	(e)	change all or any of its unissued or fully paid issued shares with par value into shares without par value or all or any of its unissued shares without par value into shares with par value;

	(f)	alter the identifying name of any of its shares;

	(g)	consolidate all or any of its unissued or fully paid issued shares without par value; or

	(h)	otherwise alter its shares or authorized share structure when required or permitted to do so by the

		Business Corporations Act .

9.2	Change of Name

	The Company may by resolution of the directors authorize an alteration to its Notice of Articles in order to change its name or adopt or change any translation of that name.

9.3	Other Alterations

	If the Business Corporations Act does not specify the type of resolution and these Articles do not specify another type of resolution, the Company may by resolution of the directors authorize an alteration of these Articles.

PART 10 – VOTES OF SHAREHOLDERS

10.1	Voting rights

	Subject to any special rights or restrictions attached to any shares and to the restrictions imposed on joint registered holders of shares under Article 10.3,

	(a)	on a vote by show of hands, every person present who is a shareholder or proxy holder and entitled to vote at the meeting has one vote, and

	(b)	on a poll, every shareholder entitled to vote has one vote in respect of each share held by that shareholder that carries the right to vote on that poll and may exercise that vote either in person or by proxy.

10.2	Trustee of shareholder may vote

	A person who is not a shareholder may vote on a resolution at a meeting of shareholders, whether on a show of hands or on a poll, and may appoint a proxy holder to act at the meeting in relation to that resolution, if, before doing so, the person satisfies the chair of the meeting at which the resolution is to be considered, or satisfies all of the directors present at the meeting, that the person is a trustee for a shareholder who is entitled to vote on the resolution.

10.3	Votes by joint shareholders

	If there are joint shareholders registered in respect of any share,

	(a)	any one of the joint shareholders, but not both or all, may vote at any meeting, either personally or by proxy, in respect of the share as if that joint shareholder were solely entitled to it, or

	(b)	if more than one of the joint shareholders is present at any meeting, personally or by proxy, the joint shareholder present whose name stands first on the central securities register in respect of the share is alone entitled to vote in respect of that share.

10.4	Trustees as joint shareholders

	Two or more trustees of a shareholder in whose sole name any share is registered are, for the purposes of Article 10.3, deemed to be joint shareholders.

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10.5	Representative of a corporate shareholder

	If a corporation that is not a subsidiary of the Company is a shareholder, that corporation may appoint a person to act as its representative at any meeting of shareholders of the Company, and,

	(a)	for that purpose, the instrument appointing a representative must

		(i)	be received at the registered office of the Company or at any other place specified, in the notice calling the meeting, for the receipt of proxies, at least 2 business days before the day set for the holding of the meeting, or

		(ii)	be provided, at the meeting, to the chair of the meeting, and

	(b)	if a representative is appointed under this Article 10.5,

		(i)	the representative is entitled to exercise in respect of and at that meeting the same rights on behalf of the corporation that the representative represents as that corporation could exercise if it were a shareholder who is an individual, including, without limitation, the right to appoint a proxy holder, and

		(ii)	the representative, if present at the meeting, is to be counted for the purpose of forming a quorum and is deemed to be a shareholder present in person at the meeting.

10.6	When proxy provisions do not apply

	Articles 10.7 to 10.13 do not apply to the Company if and for so long as it is a public company.

10.7	Appointment of proxy holder

	Every shareholder of the Company, including a corporation that is a shareholder but not a subsidiary of the Company, entitled to vote at a meeting of shareholders of the Company may, by proxy, appoint a proxy holder to attend and act at the meeting in the manner, to the extent and with the powers conferred by the proxy.

10.8	Alternate proxy holders

	A shareholder may appoint one or more alternate proxy holders to act in the place of an absent proxy holder.

10.9	When proxy holder need not be shareholder

	A person must not be appointed as a proxy holder unless the person is a shareholder, although a person who is not a shareholder may be appointed as a proxy holder if

	(a)	the person appointing the proxy holder is a corporation or a representative of a corporation appointed under Article 10.5,

	(b)	the Company has at the time of the meeting for which the proxy holder is to be appointed only one shareholder entitled to vote at the meeting, or

	(c)	the shareholders present in person or by proxy at and entitled to vote at the meeting for which the proxy holder is to be appointed, by a resolution on which the proxy holder is not entitled to vote but in respect of which the proxy holder is to be counted in the quorum, permit the proxy holder to attend and vote at the meeting.

10.10	Form of proxy

	A proxy, whether for a specified meeting or otherwise, must be either in the following form or in any other form approved by the directors or the chair of the meeting:

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(Name of Company)

The undersigned, being a shareholder of the above named Company, hereby appoints ............................................. or, failing that person, ...................................................., as proxy holder for the undersigned to attend, act and vote for and on behalf of the undersigned at the meeting of shareholders to be held on the day of and at any adjournment of that meeting.

Signed this ................. day of ...................................................., ....................

...................................................................................................
Signature of shareholder

10.11	Provision of proxies

	A proxy for a meeting of shareholders must

	(a)	be received at the registered office of the Company or at any other place specified in the notice calling the meeting for the receipt of proxies, at least the number of business days specified in the notice or, if no number of days is specified, 2 business days before the day set for the holding of the meeting, or

	(b)	unless the notice provides otherwise, be provided at the meeting to the chair of the meeting.

10.12	Revocation of proxies

	Subject to Article 10.13, every proxy may be revoked by an instrument in writing that is

	(a)	received at the registered office of the Company at any time up to and including the last business day before the day set for the holding of the meeting at which the proxy is to be used, or

	(b)	provided at the meeting to the chair of the meeting.

10.13	Revocation of proxies must be signed

	An instrument referred to in Article 10.12 must be signed as follows:

	(a)	if the shareholder for whom the proxy holder is appointed is an individual, the instrument must be signed by the shareholder or his or her trustee;

	(b)	if the shareholder for whom the proxy holder is appointed is a corporation, the instrument must be signed by the corporation or by a representative appointed for the corporation under Article 10.5.

10.14	Validity of proxy votes

	A vote given in accordance with the terms of a proxy is valid despite the death or incapacity of the shareholder giving the proxy and despite the revocation of the proxy or the revocation of the authority under which the proxy is given, unless notice in writing of that death, incapacity or revocation is received

	(a)	at the registered office of the Company, at any time up to and including the last business day before the day set for the holding of the meeting at which the proxy is to be used, or

	(b)	by the chair of the meeting, before the vote is taken.

10.15	Production of evidence of authority to vote

	The chair of any meeting of shareholders may, but need not, inquire into the authority of any person to vote at the meeting and may, but need not, demand from that person production of evidence as to the existence of the authority to vote.

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PART 11 – DIRECTORS

11.1	First directors; number of directors

	The first directors are the persons designated as directors of the Company in the Notice of Articles that applies to the Company when it is recognized under the Business Corporations Act . The number of directors, excluding additional directors appointed under Article 12.7, is set at:

	(a)	subject to paragraphs (b) and (c), the number of directors that is equal to the number of the Company’s first directors;

	(b)	if the Company is a public company, the greater of three and the number most recently elected by ordinary resolution (whether or not previous notice of the resolution was given); and

	(c)	if the Company is not a public company, the number most recently elected by ordinary resolution (whether or not previous notice of the resolution was given).

11.2	Change in number of directors

	If the number of directors is set under Articles 11.1(b) or 11.1(c):

	(a)	the shareholders may elect or appoint the directors needed to fill any vacancies in the board of directors up to that number;

	(b)	if, contemporaneously with setting that number, the shareholders do not elect or appoint the directors needed to fill vacancies in the board of directors up to that number, then the directors may appoint, or the shareholders may elect or appoint, directors to fill those vacancies.

11.3	Directors’ acts valid despite vacancy

	An act or proceeding of the directors is not invalid merely because fewer directors have been appointed or elected than the number of directors set or otherwise required under these Articles.

11.4	Qualifications of directors

	A director is not required to hold a share in the capital of the Company as qualification for his or her office but must be qualified as required by the Business Corporations Act to become, act or continue to act as a director.

11.5	Remuneration of directors

	The directors are entitled to the remuneration, if any, for acting as directors as the directors may from time to time determine. If the directors so decide, the remuneration of the directors will be determined by the shareholders. That remuneration may be in addition to any salary or other remuneration paid to a director in such director’s capacity as an officer or employee of the Company.

11.6	Reimbursement of expenses of directors

	The Company must reimburse each director for the reasonable expenses that he or she may incur in and about the business of the Company.

11.7	Special remuneration for directors

	If any director performs any professional or other services for the Company that in the opinion of the directors are outside the ordinary duties of a director, or if any director is otherwise specially occupied in or about the Company’s business, he or she may be paid remuneration fixed by the directors, or, at the option of that director, fixed by ordinary resolution, and such remuneration may be either in addition to, or in substitution for, any other remuneration that he or she may be entitled to receive.

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11.8	Gratuity, pension or allowance on retirement of director

	Unless otherwise determined by ordinary resolution, the directors on behalf of the Company may pay a gratuity or pension or allowance on retirement to any director who has held any salaried office or place of profit with the Company or to his or her spouse or dependants and may make contributions to any fund and pay premiums for the purchase or provision of any such gratuity, pension or allowance.

PART 12 – ELECTION AND REMOVAL OF DIRECTORS

12.1	Election at annual general meeting

	At every annual general meeting and in every unanimous resolution contemplated by Article 7.2:

	(a)	the shareholders entitled to vote at the annual general meeting for the election of directors may elect, or in the unanimous resolution appoint, a board of directors consisting of up to the number of directors for the time being set under these Articles; and

	(b)	all the directors cease to hold office immediately before the election or appointment of directors under paragraph (a), but are eligible for re-election or re-appointment.

12.2	Consent to be a director

	No election, appointment or designation of an individual as a director is valid unless:

	(a)	that individual consents to be a director in the manner provided for in the Business Corporations Act ;

	(b)	that individual is elected or appointed at a meeting at which the individual is present and the individual does not refuse, at the meeting, to be a director; or

	(c)	with respect to first directors, the designation is otherwise valid under the Business Corporations Act .

12.3	Failure to elect or appoint directors

	If:

	(a)	the Company fails to hold an annual general meeting, and all the shareholders who are entitled to vote at an annual general meeting fail to pass the unanimous resolution contemplated by Article 7.2, on or before the date by which the annual general meeting is required to be held under the Business Corporations Act ; or

	(b)	the shareholders fail, at the annual general meeting or in the unanimous resolution contemplated by Article 7.2, to elect or appoint any directors;

	then each director in office at such time continues to hold office until the earlier of:

	(c)	the date on which his or her successor is elected or appointed; and

	(d)	the date on which he or she otherwise ceases to hold office under the Business Corporations Act or these Articles.

12.4	Directors may fill casual vacancies

	Any casual vacancy occurring in the board of directors may be filled by the remaining directors.

12.5	Remaining directors’ power to act

	The directors may act notwithstanding any vacancy in the board of directors, but if the Company has fewer directors in office than the number set pursuant to these Articles as the quorum of directors, the directors may only act for the purpose of appointing directors up to that number or for the purpose of summoning a meeting of shareholders to fill any vacancies on the board of directors or for any other purpose permitted by the Business Corporations Act .

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12.6	Shareholders may fill vacancies

	If the Company has no directors or fewer directors in office than the number set pursuant to these Articles as the quorum of directors, and the directors have not filled the vacancies pursuant to Article 12.5 above, the shareholders may elect or appoint directors to fill any vacancies on the board of directors.

12.7	Additional directors

	Notwithstanding Articles 11.1 and 11.2, between annual general meetings or unanimous resolutions contemplated by Article 7.2, the directors may appoint one or more additional directors, but the number of additional directors appointed under this Article 12.7 must not at any time exceed:

	(a)	one-third of the number of first directors, if, at the time of the appointments, one or more of the first directors have not yet completed their first term of office; or

	(b)	in any other case, one-third of the number of the current directors who were elected or appointed as directors other than under this Article 12.7.

	Any director so appointed ceases to hold office immediately before the next election or appointment of directors under Article 12.1(a), but is eligible for re-election or re-appointment.

12.8	Ceasing to be a director

	A director ceases to be a director when:

	(a)	the term of office of the director expires;

	(b)	the director dies;

	(c)	the director resigns as a director by notice in writing provided to the Company or a lawyer for the Company; or

	(d)	the director is removed from office pursuant to Articles 12.9 or 12.10.

12.9	Removal of director by shareholders

	The Shareholders may, by special resolution, remove any director before the expiration of his or her term of office, and may, by ordinary resolution, elect or appoint a director to fill the resulting vacancy. If the shareholders do not contemporaneously elect or appoint a director to fill the vacancy created by the removal of a director, then the directors may appoint, or the shareholders may elect or appoint by ordinary resolution, a director to fill that vacancy.

12.10	Removal of director by directors

	The directors may remove any director before the expiration of his or her term of office if the director is convicted of an indictable offence, or if the director ceases to be qualified to act as a director of a company and does not promptly resign, and the directors may appoint a director to fill the resulting vacancy.

PART 13 – PROCEEDINGS OF DIRECTORS

13.1	Meetings of directors

	The directors may meet together for the conduct of business, adjourn and otherwise regulate their meetings as they think fit, and meetings of the board held at regular intervals may be held at the place and at the time that the board may by resolution from time to time determine.

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13.2	Chair of meetings

	Meetings of directors are to be chaired by

	(a)	the chair of the board, if any,

	(b)	in the absence of the chair of the board, the president, if any, if the president is a director, or

	(c)	any other director chosen by the directors if

		(i)	neither the chair of the board nor the president, if a director, is present at the meeting within 15 minutes after the time set for holding the meeting,

		(ii)	neither the chair of the board nor the president, if a director, is willing to chair the meeting, or

		(iii)	the chair of the board and the president, if a director, have advised the secretary, if any, or any other director, that they will not be present at the meeting.

13.3	Voting at meetings

	Questions arising at any meeting of directors are to be decided by a majority of votes and, in the case of an equality of votes, the chair of the meeting does not have a second or casting vote.

13.4	Meetings by telephone or other communications medium

	A director may participate in a meeting of the directors or of any committee of the directors in person, or by telephone or other communications medium, if all directors participating in the meeting are able to communicate with each other. A director may participate in a meeting of the directors or of any committee of the directors by a communications medium other than telephone if all directors participating in the meeting, whether in person or by telephone or other communications medium, are able to communicate with each other and if all directors who wish to participate in the meeting agree to such participation. A director who participates in a meeting in a manner contemplated by this Article 13.4 is deemed for all purposes of the Business Corporations Act and these Articles to be present at the meeting and to have agreed to participate in that manner .

13.5	Who may call extraordinary meetings

	A director may call a meeting of the board at any time. The secretary, if any, must on request of a director, call a meeting of the board.

13.6	Notice of extraordinary meetings

	Subject to Articles 13.7 and 13.8, if a meeting of the board is called under Article 13.4, reasonable notice of that meeting, specifying the place, date and time of that meeting, must be given to each of the directors

	(a)	by mail addressed to the director’s address as it appears on the books of the Company or to any other address provided to the Company by the director for this purpose,

	(b)	by leaving it at the director’s prescribed address or at any other address provided to the Company by the director for this purpose, or

	(c)	orally, by delivery of written notice or by telephone, voice mail, e-mail, fax or any other method of legibly transmitting messages.

13.7	When notice not required

	It is not necessary to give notice of a meeting of the directors to a director if

(a)

the meeting is to be held immediately following a meeting of shareholders at which that director was elected or appointed or is the meeting of the directors at which that director is appointed,

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	(b)	the director has filed a waiver under Article 13.9, or

	(c)	the director attends such meeting.

13.8	Meeting valid despite failure to give notice

	The accidental omission to give notice of any meeting of directors to any director, or the non-receipt of any notice by any director, does not invalidate any proceedings at that meeting.

13.9	Waiver of notice of meetings

	Any director may file with the Company a notice waiving notice of any past, present or future meeting of the directors and may at any time withdraw that waiver with respect to meetings of the directors held after that withdrawal.

13.10	Effect of waiver

	After a director files a waiver under Article 13.9 with respect to future meetings of the directors, and until that waiver is withdrawn, notice of any meeting of the directors need not be given to that director unless the director otherwise requires in writing to the Company.

13.11	Quorum

	The quorum necessary for the transaction of the business of the directors may be set by the directors and, if not so set, is a majority of the directors.

13.12	If only one director

	If, in accordance with Article 11.1, the number of directors is one, the quorum necessary for the transaction of the business of the directors is one director, and that director may constitute a meeting.

PART 14 – COMMITTEES OF DIRECTORS

14.1	Appointment of committees

	The directors may, by resolution,

	(a)	appoint one or more committees consisting of the director or directors that they consider appropriate,

	(b)	delegate to a committee appointed under paragraph (a) any of the directors’ powers, except

		(i)	the power to fill vacancies in the board,

		(ii)	the power to change the membership of, or fill vacancies in, any committee of the board, and

		(iii)	the power to appoint or remove officers appointed by the board, and

	(c)	make any delegation referred to in paragraph (b) subject to the conditions set out in the resolution.

14.2	Obligations of committee

	Any committee formed under Article 14.1, in the exercise of the powers delegated to it, must

	(a)	conform to any rules that may from time to time be imposed on it by the directors, and

	(b)	report every act or thing done in exercise of those powers to the earliest meeting of the directors to be held after the act or thing has been done.

14.3	Powers of board

	The board may, at any time,

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	(a)	revoke the authority given to a committee, or override a decision made by a committee, except as to acts done before such revocation or overriding,

	(b)	terminate the appointment of, or change the membership of, a committee, and

	(c)	fill vacancies in a committee,

14.4	Committee meetings

	Subject to Article 14.2(a),

	(a)	the members of a directors’ committee may meet and adjourn as they think proper,

	(b)	a directors’ committee may elect a chair of its meetings but, if no chair of the meeting is elected, or if at any meeting the chair of the meeting is not present within 15 minutes after the time set for holding the meeting, the directors present who are members of the committee may choose one of their number to chair the meeting,

	(c)	a majority of the members of a directors’ committee constitutes a quorum of the committee, and

	(d)	questions arising at any meeting of a directors’ committee are determined by a majority of votes of the members present, and in case of an equality of votes, the chair of the meeting has no second or casting vote.

PART 15 – OFFICERS

15.1	Appointment of officers

	The board may, from time to time, appoint a president, secretary or any other officers that it considers necessary or desirable, and none of the individuals appointed as officers need be a member of the board.

15.2	Functions, duties and powers of officers

	The board may, for each officer,

	(a)	determine the functions and duties the officer is to perform,

	(b)	entrust to and confer on the officer any of the powers exercisable by the directors on such terms and conditions and with such restrictions as the directors think fit, and

	(c)	from time to time revoke, withdraw, alter or vary all or any of the functions, duties and powers of the officer.

15.3	Remuneration

	All appointments of officers are to be made on the terms and conditions and at the remuneration (whether by way of salary, fee, commission, participation in profits or otherwise) that the board thinks fit and are subject to termination at the pleasure of the board.

PART 16 – CERTAIN PERMITTED ACTIVITIES OF DIRECTORS

16.1	Other office of director

	A director may hold any office or place of profit with the Company (other than the office of auditor of the Company) in addition to his or her office of director for the period and on the terms (as to remuneration or otherwise) that the directors may determine.

16.2	No disqualification

	No director or intended director is disqualified by his or her office from contracting with the Company either with regard to the holding of any office or place of profit the director holds with the Company or as vendor, purchaser or otherwise.

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16.3	Professional services by director or officer

	Subject to compliance with the provisions of the Business Corporations Act , a director or officer of the Company, or any corporation or firm in which that individual has an interest, may act in a professional capacity for the Company, except as auditor of the Company, and the director or officer or such corporation or firm is entitled to remuneration for professional services as if that individual were not a director or officer.

16.4	Remuneration and benefits received from certain entities

	A director or officer may be or become a director, officer or employee of, or may otherwise be or become interested in, any corporation, firm or entity in which the Company may be interested as a shareholder or otherwise, and, subject to compliance with the provisions of the Business Corporations Act , the director or officer is not accountable to the Company for any remuneration or other benefits received by him or her as director, officer or employee of, or from his or her interest in, such other corporation, firm or entity.

PART 17 – INDEMNIFICATION

17.1	Indemnification of directors

	The directors must cause the Company to indemnify its directors and former directors, and their respective heirs and personal or other legal representatives to the greatest extent permitted by Division 5 of Part 5 of the Business Corporations Act .

17.2	Deemed contract

	Each director is deemed to have contracted with the Company on the terms of the indemnity referred to in Article 17.1.

PART 18 – AUDITOR

18.1	Remuneration of an auditor

	The directors may set the remuneration of the auditor of the Company.

18.2	Waiver of appointment of an auditor

	The Company shall not be required to appoint an auditor if all of the shareholders of the Company, whether or not their shares otherwise carry the right to vote, resolve by a unanimous resolution to waive the appointment of an auditor. Such waiver may be given before, on or after the date on which an auditor is required to be appointed under the Business Corporations Act , and is effective for one financial year only.

PART 19 – DIVIDENDS

19.1	Declaration of dividends

	Subject to the rights, if any, of shareholders holding shares with special rights as to dividends, the directors may from time to time declare and authorize payment of any dividends the directors consider appropriate.

19.2	No notice required

	The directors need not give notice to any shareholder of any declaration under Article 19.1.

19.3	Directors may determine when dividend payable

	Any dividend declared by the directors may be made payable on such date as is fixed by the directors.

19.4	Dividends to be paid in accordance with number of shares

	Subject to the rights of shareholders, if any, holding shares with special rights as to dividends, all dividends on shares of any class or series of shares must be declared and paid according to the number of such shares held.

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19.5	Manner of paying dividend

	A resolution declaring a dividend may direct payment of the dividend wholly or partly by the distribution of specific assets or of paid up shares or fractional shares, bonds, debentures or other debt obligations of the Company, or in any one or more of those ways, and, if any difficulty arises in regard to the distribution, the directors may settle the difficulty as they consider expedient, and, in particular, may set the value for distribution of specific assets.

19.6	Dividend bears no interest

	No dividend bears interest against the Company.

19.7	Fractional dividends

	If a dividend to which a shareholder is entitled includes a fraction of the smallest monetary unit of the currency of the dividend, that fraction may be disregarded in making payment of the dividend and that payment represents full payment of the dividend.

19.8	Payment of dividends

	Any dividend or other distribution payable in cash in respect of shares may be paid by cheque, made payable to the order of the person to whom it is sent, and mailed

	(a)	subject to paragraphs (b) and (c), to the address of the shareholder,

	(b)	subject to paragraph (c), in the case of joint shareholders, to the address of the joint shareholder whose name stands first on the central securities register in respect of the shares, or

	(c)	to the person and to the address as the shareholder or joint shareholders may direct in writing.

19.9	Receipt by joint shareholders

	If several persons are joint shareholders of any share, any one of them may give an effective receipt for any dividend, bonus or other money payable in respect of the share.

PART 20 – ACCOUNTING RECORDS

20.1	Recording of financial affairs

	The board must cause adequate accounting records to be kept to record properly the financial affairs and condition of the Company and to comply with the provisions of the Business Corporations Act .

PART 21 – EXECUTION OF INSTRUMENTS

21.1	Who may attest seal

	The Company’s seal, if any, must not be impressed on any record except when that impression is attested by the signature or signatures of

	(a)	any 2 directors,

	(b)	any officer, together with any director,

	(c)	if the Company has only one director, that director, or

	(d)	any one or more directors or officers or persons as may be determined by resolution of the directors.

21.2	Sealing copies

	For the purpose of certifying under seal a true copy of any resolution or other document, the seal must be impressed on that copy and, despite Article 21.1, may be attested by the signature of any director or officer.

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21.3	Execution of documents not under seal

	Any instrument, document or agreement for which the seal need not be affixed may be executed for and on behalf of and in the name of the Company by any one director or officer of the Company, or by any other person appointed by the directors for such purpose.

PART 22 – NOTICES

22.1	Method of giving notice

	Unless the Business Corporations Act or these Articles provides otherwise, a notice, statement, report or other record required or permitted by the Business Corporations Act or these Articles to be sent by or to a person may be sent by any one of the following methods:

	(a)	mail addressed to the person at the applicable address for that person as follows:

		(i)	for a record mailed to a shareholder, the shareholder’s registered address;

		(ii)	for a record mailed to a director or officer, the prescribed address for mailing shown for the director or officer in the records kept by the Company or the mailing address provided by the recipient for the sending of that record or records of that class;

		(iii)	in any other case, the mailing address of the intended recipient;

	(b)	delivery at the applicable address for that person as follows, addressed to the person:

		(i)	for a record delivered to a shareholder, the shareholder’s registered address;

		(ii)	for a record delivered to a director or officer, the prescribed address for delivery shown for the director or officer in the records kept by the Company or the delivery address provided by the recipient for the sending of that record or records of that class;

		(iii)	in any other case, the delivery address of the intended recipient;

	(c)	sending the record by fax to the fax number provided by the intended recipient for the sending of that record or records of that class;

	(d)	sending the record by email to the email address provided by the intended recipient for the sending of that record or records of that class;

	(e)	physical delivery to the intended recipient.

22.2	Deemed receipt of mailing

	A record that is mailed to a person by ordinary mail to the applicable address for that person referred to in Article 22.1 is deemed to be received by the person to whom it was mailed on the day, Saturdays, Sundays and holidays excepted, following the date of mailing.

22.3	Certificate of sending

	A certificate signed by the secretary, if any, or other officer of the Company or of any other corporation acting in that behalf for the Company stating that a notice, statement, report or other record was addressed as required by Article 22.1, prepaid and mailed or otherwise sent as permitted by Article 22.1 is conclusive evidence of that fact.

22.4	Notice to joint shareholders

	A notice, statement, report or other record may be provided by the Company to the joint registered shareholders of a share by providing the notice to the joint registered shareholder first named in the central securities register in respect of the share.

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22.5	Notice to trustees

	A notice, statement, report or other record may be provided by the Company to the persons entitled to a share in consequence of the death, bankruptcy or incapacity of a shareholder by:

(a)	mailing the record, addressed to them:

	(i)	by name, by the title of the legal personal representative of the deceased or incapacitated shareholder, by the title of trustee of the bankrupt shareholder or by any similar description; and

	(ii)	at the address, if any, supplied to the Company for that purpose by the persons claiming to be so entitled; or

(b)	if an address referred to in Article 22.5(a)(ii) has not been supplied to the Company, by giving the notice in a manner in which it might have been given if the death, bankruptcy or incapacity had not occurred.

PART 23 – RESTRICTION ON SHARE TRANSFER

23.1	Application

	Article 23.2 does not apply to the Company if and for so long as it is a public company.

23.2	Consent required for transfer

	No shares may be sold, transferred or otherwise disposed of without the consent of the directors and the directors are not required to give any reason for refusing to consent to any such sale, transfer or other disposition.

PART 24 - SPECIAL RIGHTS AND RESTRICTIONS

24.1	Preferred shares issuable in series

	The Preferred shares may include one or more series and, subject to the Business Corporations Act , the directors may, by resolution, if none of the shares of any particular series are issued, alter the Articles of the Company and authorize the alteration of the Notice of Articles of the Company, as the case may be, to do one or more of the following:

	(a)	determine the maximum number of shares of that series that the Company is authorized to issue, determine that there is no such maximum number, or alter any such determination;

	(b)	create an identifying name for the shares of that series, or alter any such identifying name; and

	(c)	attach special rights or restrictions to the shares of that series, or alter any such special rights or restrictions.

	Mailing Address: PO BOX 9431 Stn Prov Govt. Victoria BC V8W 9V3 www.corporateonline.gov.bc.ca	Location: 2nd Floor - 940 Blanshard St. Victoria BC 250 356-8626

		CERTIFIED COPY
		Of a Document filed with the Province of
		British Columbia Registrar of Companies
	Notice of Articles BUSINESS CORPORATIONS ACT
		RON TOWNSHEND December 5, 2011

This Notice of Articles was issued by the Registrar on: December 5, 2011 11:08 AM Pacific Time

Incorporation Number:	C0913693

Recognition Date and Time:	Continued into British Columbia on June 22, 2011 10:21 AM Pacific Time


NOTICE OF ARTICLES
Name of Company:
REPLICEL LIFE SCIENCES INC.


REGISTERED OFFICE INFORMATION

Mailing Address:	Delivery Address:
800 885 WEST GEORGIA STREET	800 885 WEST GEORGIA STREET
VANCOUVER BC V6C 3H1	VANCOUVER BC V6C 3H1
CANADA	CANADA


RECORDS OFFICE INFORMATION

Mailing Address:	Delivery Address:
800 885 WEST GEORGIA STREET	800 885 WEST GEORGIA STREET
VANCOUVER BC V6C 3H1	VANCOUVER BC V6C 3H1
CANADA	CANADA


DIRECTOR INFORMATION

Last Name, First Name, Middle Name:
Hall, David

Mailing Address:	Delivery Address:
SUITE 1225, 888 DUNSMUIR STREET	SUITE 1225, 888 DUNSMUIR STREET
VANCOUVER BC V6C 3K4	VANCOUVER BC V6C 3K4
CANADA	CANADA

Last Name, First Name, Middle Name:
Lewis, Peter

Mailing Address:	Delivery Address:
2062 ACADIA ROAD	2062 ACADIA ROAD
VANCOUVER BC V6T 1R5	VANCOUVER BC V6T 1R5
CANADA	CANADA

Last Name, First Name, Middle Name:
Jensen, Peter

Mailing Address:	Delivery Address:
SUITE 1820, 925 WEST GEORGIA STREET	SUITE 1820, 925 WEST GEORGIA STREET
VANCOUVER BC V6C 3L2	VANCOUVER BC V6C 3L2
CANADA	CANADA

Last Name, First Name, Middle Name:
Hoffmann, Rolf

Mailing Address:	Delivery Address:
24 IN DEN ESCHMATTEN	24 IN DEN ESCHMATTEN
FREIBURG 79117	FREIBURG 79117
GERMANY	GERMANY

Last Name, First Name, Middle Name:
Challis, John

Mailing Address:	Delivery Address:
3710 SOUTHRIDGE DRIVE	3710 SOUTHRIDGE DRIVE
VANCOUVER BC V7V 3H8	VANCOUVER BC V7V 3H8
CANADA	CANADA

RESOLUTION DATES:

Date(s) of Resolution(s) or Court Order(s) attaching or altering Special Rights and Restrictions attached to a class or a series of shares:

November 18, 2011

December 5, 2011

AUTHORIZED SHARE STRUCTURE

Page: 2 of 3

1.	No Maximum Common Shares	Without Par Value

		Without Special Rights or
		Restrictions attached



2.	No Maximum Preferred Shares	Without Par Value

		With Special Rights or
		Restrictions attached

Page: 3 of 3

CERTIFICATIONS

I, David Hall, certify that:

1.	I have reviewed this annual report on Form 20-F of RepliCel Life Sciences 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 company as of, and for, the periods presented in this report;

4.	The company’s other certifying officer and I are 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 15d-15(f)) for the company 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 company, including its consolidated 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 company’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 company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

5.	The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’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 company’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 company’s internal control over financial reporting.

Date: April 26, 2012

/s/ David Hall
David Hall
Chief Executive Officer

CERTIFICATIONS

I, Tom Kordyback, certify that:

1.	I have reviewed this annual report on Form 20-F of RepliCel Life Sciences 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 company as of, and for, the periods presented in this report;

4.	The company’s other certifying officer and I are 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 15d-15(f)) for the company 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 company, including its consolidated 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 company’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 company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

5.	The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’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 company’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 company’s internal control over financial reporting.

Date: April 26, 2012

/s/ Tom Kordyback
Tom Kordyback
Chief Financial Officer
(Principal Financial and Accounting Officer)

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The undersigned, David Hall, Chief Executive Officer of RepliCel Life Sciences Inc., hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	the annual report on Form 20-F of RepliCel Life Sciences Inc. for the fiscal year ended December 31, 2011 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of RepliCel Life Sciences Inc.

Dated: April 26, 2012

/s/ David Hall
David Hall
Chief Executive Officer
RepliCel Life Sciences Inc.

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 required by Section 906, has been provided to RepliCel Life Sciences Inc. and will be retained by RepliCel Life Sciences Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The undersigned, Tom Kordyback, Chief Financial Officer of RepliCel Life Sciences Inc., hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	the annual report on Form 20-F of RepliCel Life Sciences Inc. for the fiscal year ended December 31, 2011 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Newcastle Resources Ltd.

Dated: April 26, 2012

/s/ Tom Kordyback
Tom Kordyback
Chief Financial Officer
RepliCel Life Sciences Inc.