US STEM CELL: Administration Dialogue and Evaluation of Monetary Situation and Outcomes of Operations (Kind 10-Ok)

The next is administration's dialogue and evaluation ("MD&A") of sure
important components which have affected our monetary place and working
outcomes in the course of the intervals included within the accompanying monetary statements, as
effectively as data referring to the plans of our present administration. This report
consists of forward-looking statements. Usually, the phrases "believes,"
"anticipates," "could," "will," "ought to," "count on," "intend," "estimate,"
"proceed," and related expressions or the damaging thereof or comparable
terminology are meant to determine forward-looking statements. Such statements
are topic to sure dangers and uncertainties, together with the issues set forth
on this report or different reviews or paperwork we file with the Securities and
Trade Fee occasionally, which may trigger precise outcomes or
outcomes to vary materially from these projected. Undue reliance shouldn't be
positioned on these forward-looking statements which converse solely as of the date
hereof. We undertake no obligation to replace these forward-looking statements.



The next dialogue and evaluation needs to be learn at the side of our monetary statements and accompanying notes and different monetary data contained elsewhere on this Kind 10-Ok



The Firm's MD&A is comprised of great accounting estimates made within the
regular course of its operations, overview of the Firm's enterprise circumstances,
outcomes of operations, liquidity and capital assets and contractual
obligations. The Firm didn't have any off steadiness sheet preparations as of
December 31, 2019 or 2018.



The dialogue and evaluation of the Firm's monetary situation and outcomes of
operations is predicated upon its monetary statements, which have been ready in
accordance with usually accepted accounting rules usually accepted in
the US (or "GAAP"). The preparation of these monetary statements
requires us to make estimates and judgments that have an effect on the reported quantity of
belongings and liabilities on the date of its monetary statements. Precise outcomes
could differ from these estimates below completely different assumptions or circumstances.



Our skill to proceed as a operating enterprise



The Firm's administration has evaluated whether or not there may be substantial doubt about
the Firm's skill to proceed as a going concern and has decided that
substantial doubt existed as of the date of the tip of the interval lined by
this Yearly Report on Kind 10-Ok (the "Kind 10-Ok").This willpower was based mostly
on the next components, as of December 31, 2019, the Firm had a financial institution
overdraft of $1,520 and a working capital deficit (present liabilities in extra
of present belongings) of $8,684,422. In the course of the 12 months ended December 31, 2019, the
internet loss was $3,835,337 and internet money utilized in working actions was
$1,210,994. Within the opinion of administration, these components, amongst others, elevate
substantial doubt concerning the skill of the Firm to proceed as
a going concern for an affordable time period.  As a part of its long run objective,
administration of the Firm will refocus on its animal well being division whereas it
evaluates its future alternatives for its human division and subsidiary.



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Overview



We're a biotechnology firm targeted on the invention, growth and,
topic to regulatory approval, commercialization of autologous cell therapies
for the therapy of power and acute coronary heart harm. Our lead product candidates
are MyoCell™ and Adipocell. MyoCell™ is an revolutionary medical remedy designed
to populate areas of scar tissue inside a affected person's coronary heart with autologous
muscle cells, or cells from a affected person's physique, for the aim of bettering
cardiac operate in power coronary heart failure sufferers. Adipocell is an revolutionary
cell remedy package with a number of potential therapy functions utilizing autologous
adipose cells. We're presently investigating using adipose cells in a
number of medical functions.



Biotechnology product candidates



We're targeted on the invention, growth and, topic to regulatory
approval, commercialization of autologous cell therapies for the therapy of
power and acute coronary heart harm. In our pipeline, we have now a number of product
Candidates for the therapy of coronary heart harm, together with MyoCell, MyoCell™ SDF-1
and Adipocell. MyoCell™ and MyoCell™ SDF-1 are medical muscle-derived cell
therapies designed to populate areas of scar tissue inside a affected person's coronary heart
with new dwelling cells for the aim of bettering cardiac operate in power
coronary heart failure sufferers.



MyoCell™ SDF-1 is meant to be an enchancment to MyoCell™. MyoCell™ SDF-1 is
much like MyoCell™ besides that the myoblast cells to be injected to be used in
MyoCell™ SDF-1 will probably be modified previous to injection by an adenovirus vector or
non-viral vector in order that they'll launch additional portions of the SDF-1
protein, which expresses angiogenic components. Adipocell is a package to acquire
patient-derived cells proposed for numerous in clinic procedures. We hope to
reveal that these product candidates are secure and efficient enhances to
current therapies for numerous indications.



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MyoCath Product Candidate



The MyoCath is a deflecting tip needle injection catheter that has a bigger (25
gauge) needle to permit for higher circulate charges and fewer leakage than methods that
are 27 gauge. This bigger needle permits for thicker compositions to be injected,
which helps with cell retention within the coronary heart. Additionally, the MyoCath needle has extra
fluoroscopic brightness than the usually used nitinol needle, enabling superior
visualization in the course of the process. Seeing the needle effectively throughout injections
allows the doctor who is working the catheter to pinpoint focused areas
extra exactly.



The MyoCath is used to inject cells into cardiac tissue in therapeutic
procedures to deal with power coronary heart ischemia and congestive coronary heart failure.
Investigators in our MARVEL Trial could use both our MyoCath catheters or
Biosense Webster's (a Johnson & Johnson firm) NOGA® Cardiac Navigation System
together with the MyoStar™ injection catheter for the supply of MyoCell™ to
sufferers enrolled within the trial. We're presently producing Myocath catheters
with a contract producer on an as wanted foundation.



We conduct operations in a single enterprise section. We could arrange our enterprise into
extra discrete enterprise items when and if we generate important income from
the sale of our product candidates. Our income since inception has been
generated inside and out of doors the US, and nearly all of our
long-lived belongings are positioned in the US.



GENERAL AMERICAN CAPITAL PARTNERS



On March 3, 2017, we entered into an asset sale and lease settlement
(sale/leaseback transaction; "Asset Sale and Lease Settlement"), with GACP
(Normal American Capital Companions) Stem Cell Financial institution LLC, a Florida restricted
legal responsibility firm ("GACP) whereby we bought sure lab, medical and different
tools referring to the cell banking enterprise for $400,000 and leased again the
bought tools over a 3 12 months time period.  The lease features a base month-to-month rental
cost of $20,000, due the primary day of every calendar month.  As well as, we
are required to pay 2.3%, 22.5% and 31.6% of revenues collected on deposits
arising from cell banking enterprise for years 1, 2 and three, respectively.  On the
expiration of the lease, we're required to return all leased tools and
together with any upkeep data, logs, and so on. in our  possession to the lessor
with no proper of repurchase. As a consequence of the Courtroom Order dated June 4,
2019 (see Word 12 "Authorities Declare"), the Firm resolved to terminate its
relationship with GACP and divest itself of sure tools and different belongings
(the "Tools Property") utilized in reference to the Firm's human tissue
banking enterprise, however constant nonetheless with the necessities of the Courtroom
Order, and to regulate the marketing strategy and operations to accommodate this
potential divesture.



Subsequent occasions


In the course of the 12 months ended December 31, 2020, the Firm issued a complete of 10,354,560 widespread shares, with a good worth of $ 51,914, in settlement of unpaid accounts payable. As a part of the problems, the Firm has undertaken a $ 3,586 internet acquire on settlement.



In the course of the 12 months ended December 31, 2020, the Firm issued 3,481,467 shares of
its widespread inventory, having a good worth of $21,744, in lieu of cost in money of
accrued and unpaid curiosity of $18,340, leading to a loss on settlement of
$3,404.


At February 10, 2021, as a part of a settlement settlement, the Firm transferred all of its member curiosity in American Stem Cell, LLC To dr. Kristen comella as cost for $ 100,000 accrued curiosity because of Dr Comella.

Overview of the outcomes of operations


Revenues



Our major income is from the sale of check kits and tools,
coaching companies, affected person remedies and laboratory companies, and cell
banking. Our income could fluctuate considerably from quarter to quarter and from
12 months to 12 months. We consider that period-to-period comparisons of our outcomes of
operations are usually not significant and shouldn't be relied upon as indicative of our
future efficiency. We don't count on to generate substantial revenues till we
receive regulatory approval for and commercialize our product candidates.



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We acknowledged revenues of $3,072,293 in 2019 in comparison with revenues of $6,700,888
in 2018. Our income in 2019 was generated from the sale of check kits and
tools, coaching companies, affected person remedies and laboratory companies, and
cell banking. Our revenues for 2018 had been generated from the sale, check kits and
tools, coaching companies, affected person remedies and laboratory companies, and
cell banking.



As a consequence of the Courtroom Order (see Word 12) the Firm resolved to divest
itself of sure tools and different belongings (the "Tools Property") utilized in
reference to the Firm's human tissue banking enterprise, however constant
nonetheless with the necessities of the Courtroom Order, and to regulate the enterprise
plan and operations to accommodate this potential divesture.



Price of Gross sales


Price of gross sales consists of prices related to the manufacturing of MyoCath and check kits, product prices, labor for manufacturing and coaching, and laboratory and banking prices for the services and products supplied.

The price of gross sales was $ 1,335,237 within the 12 months ended December 31, 2019 in comparison with
$ 2,110,532 within the 12 months ended December 31, 2018. The lower is as a result of lower in earnings.



Analysis and Growth



Our analysis and growth bills include prices incurred in figuring out,
creating and testing our product candidates. These bills consist primarily
of prices associated to our medical trials, the acquisition of mental
property licenses and preclinical research. We expense analysis and growth
prices as incurred.


Advertising, normal and administrative



Our advertising and marketing, normal and administrative bills primarily include the
prices related to our normal administration and medical advertising and marketing and commerce
packages, together with, however not restricted to, salaries and associated bills for
government, administrative and advertising and marketing personnel, hire, insurance coverage, authorized and
accounting charges, consulting charges, journey and leisure bills, convention
prices and different medical advertising and marketing and commerce program bills.



Inventory-Primarily based Compensation



Inventory-based compensation which is included within the Advertising, Normal and
Administrative above, displays our recognition as an expense of the worth of
inventory choices and different fairness devices issued to our workers and
non-employees over the vesting interval of the choices and different fairness
devices. We've got granted to our workers choices to buy shares of
widespread inventory at train costs as decided by our Board of Administrators, with
enter from administration.


In valuing our widespread shares, our board of administrators thought of various components, together with, however not restricted to:


  ? our monetary place and historic monetary efficiency;
  ? the illiquidity of our capital inventory;
  ? arm's size gross sales of our widespread inventory;
  ? the event standing of our product candidates;
  ? the enterprise dangers we face;
  ? vesting restrictions imposed upon the fairness awards;
  ? an analysis and benchmark of our opponents; and
  ? the prospects of a liquidity occasion.




On April 1, 2013, our Board of Administrators authorized, topic to subsequently
acquired shareholder approval, the institution of the Bioheart 2013 Omnibus
Fairness Compensation Plan, or the "2013 Omnibus Plan" (changing the 1999
Officers and Workers Inventory Choice Plan, or the Worker Plan, and the 1999
Administrators and Consultants Inventory Choice Plan). The 2013 Omnibus Plan initially
reserved as much as fifty thousand (50,000) shares of widespread inventory for issuance. On
August 4, 2014, the Board of Administrators authorized to set the reserve to 1
hundred thousand (100,000) shares of widespread inventory for issuance and to shut the
1999 Officers and Workers Inventory Choice Plan. On February 2, 2015, on the
annual assembly of shareholders, nearly all of shareholders authorized the 2013
Omnibus Fairness Compensation Plan. On November 2, 2015, the Board of Administrators
authorized the rise of the reserve below the 2013 Omnibus Plan to 5 hundred
million (500,000,000) shares of widespread inventory for issuance, efficient September
16, 2016, authorized an addition of twenty 5 million (25,000,000) shares of
widespread inventory to the reserve, efficient April 21, 2017, authorized an addition of
twenty 5 million (25,000,000) shares of widespread inventory to the reserve,
efficient August 7, 2017, authorized an addition of thirty million (30,000,000)
shares of widespread inventory to the reserve and efficient Might 7, 2018, authorized an
addition of 100 million (100,000,000) shares of widespread inventory to order.



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A abstract of choices at December 31, 2019 and exercise in the course of the 12 months then
ended is introduced beneath:



                                                                                        Weighted-
                                                                                         Common
                                                                    Weighted-           Remaining
                                                                     Common           Contractual
                                                  Shares         Train Value      Time period (in years)
Choices excellent at December 31, 2018         112,970,693     $        0.0329                  8.7
Granted                                           40,900,000     $        0.0055                 10.0
Exercised                                                  -
Forfeited/Expired                                (42,750,219 )   $        0.0280

Present choices at December 31, 2019 111 120 474 $ 0.0247

                  8.3

Choices exercisable at December 31, 2019 55 026 724 $ 0.0255

                  7.9

Out there for grant at December 31, 2019 34 168 070




A abstract of inventory choice exercise for the 12 months ended December 31, 2019 is as
follows:



                           Choices Excellent                                       Choices Exercisable
                                           Weighted            Weighted                             Weighted
                      Excellent          Common             Common          Exercisable         Common
    Train            Quantity          Remaining Life         Train           Quantity            Train
     Value            of Choices           In Years             value           of Choices           value
$0.000 to $0.010        41,900,000                  9.0     $       0.0051        13,050,000     $       0.0043$0.011 to $0.020        16,300,000                  6.7             0.0196        13,800,000             0.0196
$0.021 to $0.030         9,710,000                  8.9             0.0253         8,052,500             0.0252
    $0.0363             22,735,000                  7.6             0.0363        14,680,000             0.0363
    $0.0536             20,000,000                  8.4             0.0536         5,000,000             0.0536
    $0.1540                475,474                  5.8             0.1540           444,224             0.1540
Whole                  111,120,474                  8.3     $       0.0247        55,026,724     $       0.0255




On Might 7, 2018, we granted an combination 30,000,000 choices to buy the
Firm's widespread inventory at $0.0536 per share to key workers, vesting over 4
years, at grant date anniversary and exercisable over 10 years. The mixture
truthful worth of $1,438,473, decided utilizing the Black Scholes choice pricing
mannequin with the next assumptions: Dividend yield: 0%; Volatility: 261.13%
and Danger free charge: 2.90%.



On August 8, 2018, we granted an combination 2,340,000 choices to buy our
firm's widespread inventory at $0.02576 per share to key workers, vesting over 4
years, at grant date anniversary and exercisable over 10 years. The mixture
truthful worth of $91,988, decided utilizing the Black Scholes choice pricing mannequin
with the next assumptions: Dividend yield: 0%; Volatility: 217.72% and Danger
free charge: 2.83%.



On December 3, 2018, we granted an combination 9,000,000 choices to buy our
firm's widespread inventory at $0.02511 per share to board members, vesting
instantly exercisable over 10 years. The mixture truthful worth of $195,722,
decided utilizing the Black Scholes choice pricing mannequin with the next
assumptions: Dividend yield: 0%; Volatility: 215.29% and Danger free charge: 2.83%.



On September 1, 2019, the Firm granted an combination 33,400,000 choices to
buy the Firm's widespread inventory at $0.0056 per share to key workers,
vesting over 4 years, at grant date anniversary and exercisable over 10 years.
The mixture truthful worth of $192,189, was decided utilizing the Black Scholes
choice pricing mannequin with the next assumptions: Dividend yield: 0%;
Volatility: 215.10% and Danger-free charge: 1.45%.



On November 18, 2019, the Firm granted to its administrators an combination of
7,500,000 choices to buy the Firm's widespread inventory at $0.0049 per share
that vested instantly and are exercisable for 10 years. The mixture truthful
worth of $34,477, was decided utilizing the Black Scholes choice pricing mannequin
with the next assumptions: Dividend yield: 0%; Volatility: 213.97% and
Danger-free charge: 1.81%.



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The mixture intrinsic worth of excellent inventory choices was $0, based mostly on
choices with an train value lower than the Firm's inventory value of $0.0035 as
of December 31, 2019, which might have been acquired by the choice holders had
these choice holders exercised their choices as of that date.



The truthful worth of all choices that vested in the course of the years ended
December 31, 2019 and 2018 was $735,176 and $753,007, respectively. As of
December 31, 2019, the Firm had $1,415,552 of complete unrecognized compensation
value associated to non-vested awards granted below the 2013 Omnibus Plan, which the
Firm expects to acknowledge over a weighted common interval of 1.24 years.



Warrants



A abstract of widespread inventory buy warrants for the 12 months ended December 31, 2019
is introduced beneath:



                                                                                     Weighted-Common
                                                Variety of     

Weighted common remaining life

                                                Warrants        Train Value           in Years
Excellent at December 31, 2018                 1,114,019     $         14.7350                   9.1
Issued                                                   -
Exercised                                                -
Expired                                             (3,551 )   $          607.31
Excellent at December 31, 2019                 1,110,468     $           12.84                   8.2
Exercisable at December 31, 2019                 1,108,923     $            2.14                   8.2



The next data applies to strange share subscription warrants in circulation and exercisable at December 31, 2019:



                         Warrants Excellent                                     Warrants Exercisable
                                         Weighted           Weighted                             Weighted
                   Excellent           Common             Common         Exercisable          Common
  Train            Quantity            Remaining           Train            Quantity           Train
    Value          of Warrants        Life in Years           Value          of Warrants           Value
$0.01 -20.00           1,086,536                  8.2     $        1.27          1,086,536     $        1.27$20.01 -30.00             19,543                  4.2     $       25.06             19,543     $       25.06$40.01 -50.00              2,253                  2.8     $       48.83              2,253     $       48.83$50.01 -60.00                543                  1.6     $       60.00                543     $       60.00
   > 60.00        $        1,593                  6.8     $    7,690.00                 48     $    7,690.00
                       1,110,468                  8.2     $       12.84$    1,108,923$        2.14




On August 27, 2018, we issued 1,000,000 warrants to buy our firm's
widespread inventory at $0.02713 per share for companies rendered, vesting 6 months from
issuance and exercisable over 10 years. The mixture truthful worth of $24,986,
decided utilizing the Black Scholes choice pricing mannequin with the next
assumptions: Dividend yield: 0%; Volatility: 217.01% and Danger free charge: 2.85%.



Curiosity Expense



Curiosity expense in the course of the 12 months ended December 31, 2019 was $981,001 in contrast
to $1,444,807 for the 12 months ended December 31, 2018. Curiosity expense primarily
consists of curiosity incurred on the principal quantity of the Northstar mortgage,
the Seaside Nationwide Financial institution mortgage, the Capital Lease with GACP, accrued charges and
curiosity payable to the Guarantors, imputed curiosity on non-interest bearing
debt, the amortization of debt reductions and non-cash curiosity incurred relating
to our issued convertible notes payable.



The debt reductions amortization and non-cash curiosity incurred in the course of the 12 months
ended December 31, 2019 and 2018 was $198,355 and $195,967, respectively. There
was nominal change in curiosity 12 months over 12 months.



On January 3, 2018, we  renewed the mortgage with Seaside Nationwide Financial institution and Belief
lengthen the maturity date to Might 18, 2020 all different phrases and circumstances stay
unchanged. On Might 18, 2020, the Seaside mortgage was changed into a Demand Word with
no mounted maturity date however with a redocumentation requirement each 4 years.
The brand new redocumentation deadline is Might 2022.



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Vital Accounting Insurance policies



Our dialogue and evaluation of our monetary situation and outcomes of operations
is predicated upon our monetary statements, which have been ready in accordance
with accounting rules usually accepted in the US. The
preparation of those monetary statements requires us to make estimates and
assumptions that have an effect on the reported quantities of belongings, liabilities, revenues
and bills. We base our estimates on historic expertise and on numerous
different assumptions that we consider to be affordable below the circumstances, the
outcomes of which type the premise for making judgments concerning the carrying values
of belongings and liabilities that aren't readily obvious from different sources.
Precise outcomes could differ from these estimates below completely different assumptions or
circumstances. Whereas our crucial accounting insurance policies are described in Word 1 to
our monetary statements showing elsewhere on this report, we consider the
following insurance policies are vital to understanding and evaluating our reported
monetary outcomes:



Income Recognition



Efficient January 1, 2018, we acknowledge income in accordance with Accounting
Requirements Codification 2014-09, Income from Contracts with Prospects (Matter
606), which supersedes the income recognition necessities in Matter 605,
Income Recognition, and most industry-specific income recognition steering
all through the Business Subjects of the Accounting Requirements Codification. The
up to date steering states that an entity ought to acknowledge income to depict the
switch of promised items or companies to clients in an quantity that displays
the consideration to which the entity expects to be entitled in trade for
these items or companies. The steering additionally gives for extra disclosures
with respect to revenues and money flows arising from contracts with clients.



On the time of every transaction, administration assesses whether or not the price related
with the transaction is mounted or determinable and whether or not or not assortment is
fairly assured. The evaluation of whether or not the price is mounted or determinable
is predicated upon the cost phrases of the transaction. Collectability is assessed
based mostly on various components, together with previous transaction historical past with the consumer
and the creditworthiness of the consumer.



Our predominant sources of earnings come from the sale of check kits and tools, coaching companies, affected person remedies, laboratory companies and cell banks.



Revenues for kits and tools bought are usually not recorded till kits and tools
are acquired by the client. Revenues from in-person trainings are acknowledged
when the coaching happens and revenues from on demand on-line trainings are
acknowledged when the client purchases the rights to the coaching course. Any
money acquired as a deposit for trainings are recorded by the Firm as a
legal responsibility.



Revenues from affected person remedies and laboratory companies are acknowledged when these companies are accomplished or happy.



Revenues for cell banking gross sales are accounted for as a number of efficiency
obligations as described in 606 and addresses accounting for preparations that
could contain the supply or efficiency of a number of merchandise, companies and/or
rights to make use of belongings. As a result of the Firm sells its companies individually, on extra
than a restricted foundation and at a value inside a slender vary, our firm was in a position
to allocate income based mostly on stand-alone pricing. The a number of efficiency
obligations embrace stem cell banking, dose retrieval and yearly storage charges.
Revenues for stem cell banking and dose retrieval is acknowledged on the level of
service and revenues for the yearly storage charges is acknowledged over the time period of
the banking contract, which is often one 12 months with annual renewals.



Inventory-based compensation



We measure the price of companies acquired in trade for an award of fairness
devices based mostly on the truthful worth of the award. For workers and administrators,
the truthful worth of the award is measured on the grant date and for non-employees,
the truthful worth of the award is mostly re-measured on vesting dates and
interim monetary reporting dates till the service interval is full. The truthful
worth quantity is then acknowledged over the interval throughout which companies are
required to be supplied in trade for the award, normally the vesting interval.
Inventory-based compensation expense is recorded by our firm in the identical expense
classifications within the statements of operations, as if such quantities had been paid in
money.



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Revenue taxes



Revenue taxes are accounted for below the asset and legal responsibility technique.  Deferred
tax belongings and liabilities are acknowledged for the long run tax penalties
attributable to variations between the monetary assertion carrying quantities of
current belongings and liabilities and their respective tax bases and working
loss carry forwards which can be out there to be carried ahead to future years for
tax functions.  Deferred tax belongings and liabilities are measured utilizing enacted
tax charges anticipated to use to taxable earnings within the years during which these
non permanent variations are anticipated to be recovered or settled.  The impact on
deferred tax belongings and liabilities of a change in tax charges is acknowledged in
earnings within the interval that features the enactment date.  When it isn't
thought of to be extra seemingly than not {that a} deferred tax asset will probably be
realized, a valuation allowance is supplied for the surplus.  Though we have now
important loss carry forwards out there to scale back future earnings for tax
functions, no quantity has been mirrored on the steadiness sheet for deferred earnings
taxes as any deferred tax asset has been totally offset by a valuation allowance.



Use of Estimates



The preparation of monetary statements in conformity with GAAP requires
administration to make estimates and assumptions that have an effect on the reported quantities of
belongings and liabilities, disclosure of contingent belongings and liabilities on the
date of the monetary statements and the reported quantities of revenues and
bills in the course of the reporting interval. Important estimates embrace stock-based
compensation,  debt reductions and the valuation allowance associated to deferred
tax belongings. Precise outcomes could differ from these estimates.



Analysis and growth prices



We account for analysis and growth prices in accordance with Accounting
Requirements Codification subtopic 730-10, Analysis and Growth ("ASC 730-10").
Beneath ASC 730-10, all analysis and growth prices should be charged to expense
as incurred. Accordingly, inside analysis and growth prices are expensed
as incurred. Third-party analysis and growth prices are expensed when the
contracted work has been carried out or as milestone outcomes have been achieved as
outlined below the relevant settlement. Firm-sponsored analysis and
growth prices associated to each current and future merchandise are expensed in
the interval incurred.



Depreciation


Depreciation is calculated utilizing the straight-line technique over the anticipated helpful lifetime of the belongings or over the time period of the lease, for belongings topic to capital leases.



Money and Money Equivalents



Money and money equivalents embrace money available, financial institution deposits with a maturity of three months or much less, and all extremely liquid investments that may be withdrawn or used with out limitation and whose unique maturity is lower than or equal to a few months. or equal to a few months.



Choices and warrants issued



We allocate the proceeds acquired from the fairness financing and the choices and hooked up warrants issued, based mostly on their relative truthful values, on the time of issuance. The quantity allotted to choices and warrants is recorded along with paid-up capital.


Associated Events



For the needs of those monetary statements, events are thought of to be
associated if one occasion has the flexibility, instantly or not directly, to regulate the
occasion or train important affect over the occasion in making monetary and
working selections, or vice versa, or the place our firm and the occasion are
topic to widespread management or widespread important affect. Associated events could
be people or different entities.



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Outcomes of Operations



We're a analysis and growth stage firm and our MyoCell™ product
candidate has not acquired regulatory approval or generated any materials
revenues and isn't anticipated to till late 2019, if ever. We've got generated
substantial internet losses and damaging money circulate from operations since inception
and anticipate incurring important internet losses and damaging money flows from
operations for the foreseeable future as we proceed medical trials, undertake
new medical trials, apply for regulatory approvals, make capital expenditures,
add data methods and personnel, make funds pursuant to our license
agreements upon our achievement of sure milestones, proceed growth of
extra product candidates utilizing our expertise, set up gross sales and
advertising and marketing capabilities and incur the extra value of working as a public
firm.


Comparability of accomplished years December 31, 2019 and December 31, 2018


Revenues



We acknowledged revenues of $3,072,093 in 2019, revenues generated from the sale
of, kits and tools, companies, and laboratory companies.  In 2018, we
acknowledged revenues of $6,700,888, revenues generated from the gross sales of kits and
laboratory companies. Variance 12 months over 12 months was because of elevated competitors
and saturated market.



Price of Gross sales


The price of gross sales was $ 1,335,237 in 2019 and $ 2,110,532 in 2018. The variance was as a result of elevated value of service tools for the tissue financial institution.


Analysis and Growth



Analysis and growth bills had been $263 in 2019, a lower of $5,176 from
analysis and growth bills of $5,439in 2018. The lower was primarily
attributable to a lower within the quantity of accessible funds.



The timing and quantity of our deliberate analysis and growth spending is determined by our skill to safe extra funding.

Advertising, normal and administrative



Advertising, normal and administrative bills had been $4,454,711 in 2019, a
lower of $1,227,585 from advertising and marketing, normal and administrative bills of
$5,682,296 in 2018. The lower is because of diminished operations as a result of Courtroom
order.


Achieve (loss) on debt settlement



In the course of the 12 months ended December 31, 2019, we acknowledged a internet acquire of $214,883
primarily associated to the dissolved GACP transaction and divestiture of belongings.
In 2018, we acknowledged a acquire of $5,625 primarily associated to the settlement of
accounts payable and accrued curiosity.



Achieve on sale of apparatus


In March 2017, we entered right into a sale-leaseback transaction whereby we bought our laboratory and different medical tools and re-leased the tools for 36 months.

In

reference to the sale/leaseback, we realized a acquire on sale of apparatus of
$128,845 which is acknowledged as of the divestiture of the belongings in October
2019. In the course of the 12 months ended December 31, 2019, we acknowledged $128,845 in present
interval operations as in comparison with $107,371 for the earlier 12 months.



Fairness funding earnings



Our funding of 33% member curiosity ownerships of U.S. Stem Cell Clinic, LLC
and Regenerative Wellness Clinic, LLC (subsequently elevated after December 31,
2018) and effectively as our 49% member curiosity possession in U.S. Stem Cell of the
Villages LLC are accounted for utilizing the fairness technique of accounting.  As such,
we report our professional rata share of its earnings or loss for the interval.  For the 12 months
ended December 31, 2018 and 2017, our professional rata share of its earnings was $247,813
and $192,383, respectively.



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  Index



Curiosity Expense



Curiosity expense was $981,001 in 2019 in comparison with curiosity expense of $1,444,807
in 2018. Non-cash curiosity comprised of amortization of debt reductions and
totaled $198,355 in 2019 as in comparison with $195,967 in 2018.  Variance in curiosity
because of amortization of capitalized bills.



Inflation


Our view is that inflation has not and mustn’t have had a cloth impact on our enterprise.


Local weather Change



Our opinion is that neither local weather change, nor governmental laws associated
to local weather change, have had, or are anticipated to have, any materials impact on our
operations.


Liquidity and capital assets

In 2019, we continued to finance our operational money circulate wants with money generated from financing actions.


Working Actions



Web money utilized in working actions in the course of the 12 months ended December 31, 2019
was $1,210,994 and consisted primarily of a internet lack of $3,835,337, a lower
in deferred income of $272,865, acquire on settlement of notes payable and accrued
curiosity of $214,883, acquire on sale of apparatus of $128,845 and earnings on fairness
investments of $117,318, partially offset by associated occasion notes payable issued
for companies rendered of $978,077, stock-based compensation of $824,426, notes
payable issued in pre-trial settlements of $698,937, a rise in accounts
payable of $344,536, depreciation and amortization expense of $242,615 and
amortization of debt low cost of $198,335.



Web supplied by working actions in the course of the 12 months ended December 31, 2018 was
$602,467 and consisted primarily of stock-based compensation of $1,227,924,
associated occasion notes payable issued for companies rendered of $800,000, an
enhance in accounts payable of $426,263, a rise in accrued bills of
$226,673, depreciation and amortization expense of $207,132 and amortization of
debt low cost of $195,967, partially offset by a internet lack of $2,160,427, earnings
on fairness investments of $247,813 and acquire on sale of apparatus of $128,845.



Investing Actions


Web money circulate generated by investing actions for the 12 months ended December 31, 2019
has been $ 166,834 and consisted of the proceeds of fairness investments.

Web money circulate from investing actions for the 12 months ended December 31, 2018
has been $ 311,700 and consisted of the proceeds of fairness investments.


Financing Actions



Web money utilized in financing actions for the 12 months ended December 31, 2019 was
$312,986 and consisted primarily of repayments of notes payable of $512,486 and
repayments of associated occasion notes of $321,607, partially offset by proceeds from
associated occasion advances of $276,843 and proceeds from associated occasion notes of
$107,868.



Web money utilized in financing actions for the 12 months ended December 31, 2018 was
$543,820 and consisted primarily of repayments of associated occasion notes of
$708,422 and repayments of notes payable of $656,468, partially offset by
proceeds from sale of widespread inventory of $367,700, proceeds from notes payable of
$220,211, proceeds from associated occasion advances of $130,000 and fairness
contribution by associated occasion of $103,159.



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Index

Current capital assets and future capital wants



Our MyoCell™ product candidate has not acquired regulatory approval or generated
any materials revenues. We don't count on to generate any materials revenues or
money from gross sales of our MyoCell™ product candidate till commercialization of
MyoCell, if ever. We've got generated substantial internet losses and damaging money
circulate from operations since inception and anticipate incurring important internet
losses and damaging money flows from operations for the foreseeable future.
Traditionally, we have now relied on proceeds from the sale of our widespread inventory and
our incurrence of debt to supply the funds essential to conduct our analysis
and growth actions and to satisfy our different money wants.



At December 31, 2019, we had money and money equivalents totaling $0; our working
capital deficit as of such date was $8,684,422. Our impartial registered
public accounting agency has issued its report dated July fifteenth 2021 in connection
with the audit of our monetary statements as of December 31, 2019 that included
an explanatory paragraph describing the existence of circumstances that elevate
substantial doubt about our skill to proceed as a going concern.



From December 31, 2019, we have now had $ 6,691,144 in excellent debt, internet of debt low cost of $ 79,744.

Off-balance sheet provisions



We don't have any off-balance sheet preparations which have or are fairly
prone to have a present or future impact on our monetary situation, adjustments in
monetary situation, revenues or bills, outcomes of operations, liquidity,
capital expenditures or capital assets which can be materials to buyers.



Latest accounting positions

Seek advice from Word 1. Group and abstract of great accounting insurance policies within the notes to our monetary statements for a dialogue of current accounting pronouncements.

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