What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2021-08-16 compared with 2021-05-17 · 410 added, 683 removed, 612 unchanged (64% of the section changed)

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Intangible assets, net

LIABILITIES AND STOCKHOLDERS’

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities:

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Commitments and Contingencies

Stockholders’

Stockholders' Deficit:

Preferred stock, $ 0.01 par value;

Authorized, 20,000,000 shares;

none issued and

outstanding at March 31, 2021 and December 31, 2020

none issued and outstanding at June 30, 2021 and December 31, 2020

Common stock, $ 0.0001 par value;

Authorized, 300,000,000,000 shares;

and outstanding 3,175,911,955 and 2,862,174,380, respectively

Issued and outstanding 3,347,778,690 and 2,862,174,380 , respectively

Additional paid in capital

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( 89,842,833 )

Total Stockholders’

Total Liabilities and Stockholders’

Total Stockholders' Deficit

( 3,808,941 )

( 1,331,492 )

Total Liabilities and Stockholders' Deficit

accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

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Consolidated STATEMENTS OF OPERATIONS

June 30, 2021

June 30, 2020

June 30, 2021

June 30, 2020

For the Three Months Ended

March 31, 2021

March 31, 2020

For the Six Months Ended

June 30, 2021

June 30, 2020

June 30, 2021

June 30, 2020

Operating expenses:

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( 3,555,263 )

Other expense:

( 18,609,919 )

( 1,280,577 )

Other income (expense):

Interest expense

Amortization of debt discount

( 1,106,006 )

( 1,376,620 )

Loss on extinguishment of notes payable, net

Change in fair value of derivative liabilites

Change in fair value of derivative liabilities

( 2,141,069 )

Reorganization items, net

Total other expense

Total other (income) expense

( 1,106,006 )

( 3,394,535 )

Net Loss Per Share

Net income (loss)

$ ( 4,062,595 )

$ ( 19,715,925 )

$ ( 4,675,112 )

Net Income (Loss) Per Share

- Basic and Diluted

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3,183,506,849

1,594,651,383

3,052,341,760

1,277,364,646

accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

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AND SUBSIDIARY

Consolidated STATEMENTS of CHANGES IN STOCKHOLDERS’

Shareholders’

at January 1, 2021

Consolidated STATEMENTS of CHANGES IN STOCKHOLDERS’ DEFICIT

Shareholders’

Balance at January 1, 2021

2,862,174,380

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$ ( 1,331,492 )

issued in exchange of notes payable and accrued interest

issued in cashless exercise of warrants

compensation:

Shares and warrants issued for cash

Shares and warrants issued for cash, shares

Shares issued in exchange of notes payable and accrued interest

Shares issued in cashless exercise of warrants

Stock-based compensation:

- restricted share units

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( 15,653,330 )

as of March 31, 2021

Balance as of March 31, 2021

3,175,911,955

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( 2,694,382 )

Shares issued in exchange of notes payable and accrued interest

Shares issued in cashless exercise of warrants

Stock-based compensation:

- restricted share units

( 4,062,595 )

at January 1, 2020

( 4,062,595 )

Balance at June 30, 2021

3,347,778,690

and warrants issued for cash

issued in exchange for notes payable and accrued interest

$ 105,415,037

compensation:

as of March 31, 2020

$ ( 109,558,758 )

$ ( 3,808,941 )

Balance at January 1, 2020

$ ( 78,570,146 )

$ ( 12,776,146 )

Shares and warrants issued for cash

Shares issued in exchange for notes payable and accrued interest

1,515,799,750

Stock-based compensation:

( 7,550,772 )

Balance as of March 31, 2020

1,594,651,383

( 86,120,918 )

( 17,536,105 )

Stock-based compensation:

restricted share units

Stock-based compensation:

Net income (loss)

Balance at June 30, 2020

1,594,651,383

$ ( 83,245,258 )

$ ( 14,441,181 )

accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

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Consolidated STATEMENTS OF CASH FLOWS

Three Months Ended

March 31, 2021

March 31, 2020

June 30, 2021

June 30, 2020

Six Months Ended

June 30, 2021

June 30, 2020

Cash flows from operating activities:

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Loss on extinguishment of note payables, net

Write-off of derivative liabilities

( 4,375,231 )

Change in fair value of derivative liabilities

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Accrued interest, expenses and other current liabilities

Lease liability

Net cash used in operating activities

( 1,555,530 )

Cash flows from financing activities:

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Proceeds from PPP Loan

Proceeds from DIP Financing

Sales of common stock and warrants for cash

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Net (decrease) increase in cash and cash equivalents

Cash and cash equivalents - beginning of period

Cash and cash equivalents - end of period

( 1,305,530 )

Cash- beginning of period

Cash- end of period

Supplemental cash flow information:

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Non-cash investing and financing activities:

Shares issued in exchange for notes payable and accrured interest

Bifurcated embedded conversion options and warrants recorded as derivative liability

and debt discount

Shares issued in exchange for notes payable and accrued interest

Bifurcated embedded conversion options and warrants recorded as derivative liability and debt discount

Sale of warrants recorded as derivative liabilities

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Therapies, Inc.

has one wholly-owned subsidiary, Stem Pearls, LLC (“Stem Pearls”).

BioRestorative Therapies, Inc.

subsidiary are referred to collectively as “BRT”

or the “Company”.

March 20, 2020 (the “Petition Date”), the Company filed a voluntary petition commencing a case (the “Chapter 11 Case”)

subsidiary are referred to collectively as “BRT” or the “Company”.

March 20, 2020 (the “Petition Date”), the Company filed a voluntary petition commencing a case (the “Chapter 11 Case”)

under chapter 11 of title 11 of the U.S.

Code in the United States Bankruptcy Court for the Eastern District of New York (the “Bankruptcy

Court”).

August 7, 2020 the Company and Auctus Fund, LLC (“Auctus”), the Company’s largest unsecured creditor and a stockholder

as of the Petition Date, filed an Amended Joint Plan of Reorganization (the “Plan”) and on October 30, 2020, the Bankruptcy

Court entered an order (the “Confirmation Order”) confirming the Plan, as amended.

Code in the United States Bankruptcy Court for the Eastern District of New York (the “Bankruptcy

August 7, 2020 the Company and Auctus Fund, LLC (“Auctus”), the Company’s largest unsecured creditor and a stockholder

as of the Petition Date, filed an Amended Joint Plan of Reorganization (the “Plan”) and on October 30, 2020, the Bankruptcy

Court entered an order (the “Confirmation Order”) confirming the Plan, as amended.

Amendments to the Plan are reflected in

the Confirmation Order.

On November 16, 2020 (the “Effective Date”), the Plan became effective.

See Note 5 –

Payable –

Chapter 11 Reorganization.

On November 16, 2020 (the “Effective Date”), the Plan became effective.

See Note 5 – Notes

Payable – Chapter 11 Reorganization.

of the Business

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website is at www.biorestorative.com.

BRT is currently developing a Disc/Spine Program referred to as “brtxDISC”.

cell therapy candidate, BRTX-100 , is a product formulated from autologous (or a person’s own) cultured mesenchymal stem

cells collected from the patient’s bone marrow.

BRT is currently developing a Disc/Spine Program referred to as “brtxDISC”.

cell therapy candidate, BRTX-100 , is a product formulated from autologous (or a person’s own) cultured mesenchymal stem

cells collected from the patient’s bone marrow.

The product is intended to be used for the non-surgical treatment of painful lumbosacral

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a going concern, which contemplates realization of assets and satisfying liabilities in the normal course of business.

At March 31, 2021,

At June 30, 2021,

the Company had an accumulated deficit of approximately $ 109,559,000 and working capital surplus of approximately $ 502,000 .

three months ended March 31, 2021, the Company had a loss from operations of approximately $15,055,000 (of which, approximately $14,077,000

months ended June 30, 2021, the Company had a loss from operations of approximately $ 18,610,000 (of which, approximately $ 17,003,000

was attributable to non-cash stock-based compensation) and negative cash flows from operations of approximately $ 1,556,000 .

The Company’s

operating activities consume the majority of its cash resources.

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infusions of cash from equity and debt financing.

As of June 30, 2021, the Company has access to approximately $ 2,100,000 in additional

funding from Auctus, as discussed below.

Company believes the following has been able to mitigate the above factors with regards to its ability to continue as a going concern:

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the Company secured DIP financing during its Chapter 11 Case in the amount of $ 1,189,413 , as well as an aggregate amount of $ 3,848,548

in debt financing from Auctus and others as part of the Company’s Chapter 11 reorganization, to sustain operations;

and (iii) pursuant

to the plan of reorganization, Auctus is required to loan to the Company, as needed, an additional amount equal to $3,500,000, less the

amount of Auctus’

DIP financing ($1,226,901, inclusive of accrued interest) and its DIP costs not to exceed approximately $650,000.

As a result of the above, and cash on hand of approximately $2,248,000 as of May 11, 2021, the Company believes it has sufficient cash

to fund operations for the twelve months subsequent to the filing date.

In addition, the Company is seeking further funding to commence

and complete a Phase 2 clinical study of the use of BRTX-100.

is no assurance that these funds will be sufficient to enable the Company to fully complete its development activities or attain profitable

If the Company is unable to obtain such additional financing on a timely basis the Company may have to curtail its development,

marketing and promotional activities, which would have a material adverse effect on the Company’s business, financial condition

and results of operations, and ultimately the Company could be forced to discontinue its operations and liquidate.

to the plan of reorganization, Auctus is required to loan to the Company, as needed, an additional $ 2,100,000 .

As a result of the above,

and cash on hand of approximately $ 1,586,414 as of August 12, 2021, the Company believes it has sufficient cash to fund

operations for the twelve months subsequent to the filing date.

In addition, the Company is seeking further funding to commence and complete

a Phase 2 clinical study of the use of BRTX-100.

funds and Auctus’ funding obligation noted above will not be sufficient to enable the Company to fully complete its development

activities or attain profitable operations.

If the Company is unable to obtain such needed additional financing on a timely basis, the

Company may have to curtail its development, marketing and promotional activities, which would have a material adverse effect on the

Company’s business, financial condition and results of operations, and ultimately the Company could be forced to discontinue its

operations and liquidate.

accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally

accepted in the United States of America (“GAAP”), which contemplate continuation of the Company as a going concern and the

realization of assets and satisfaction of liabilities in the normal course of business.

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of Presentation

accompanying unaudited condensed consolidated financial information as of and for the three months ended March 31, 2021 and 2020 has

been prepared in accordance with GAAP for interim financial information and with the instructions to Quarterly Report on Form 10-Q and

Article 10 of Regulation S-X.

In the opinion of management, such financial information includes all adjustments (consisting only of normal

recurring adjustments) considered necessary for a fair presentation of the Company’s financial position at such dates and the operating

results and cash flows for such periods.

Operating results for the three months ended March 31, 2021 are not necessarily indicative of

the results that may be expected for the entire year or for any other subsequent interim period.

accompanying unaudited condensed consolidated financial information as of and for the three and six months ended June 30, 2021 and 2020

has been prepared in accordance with GAAP for interim financial information and with the instructions to Quarterly Report on Form 10-Q

and Article 10 of Regulation S-X.

In the opinion of management, such financial information includes all adjustments (consisting only

of normal recurring adjustments) considered necessary for a fair presentation of the Company’s financial position at such dates

and the operating results and cash flows for such periods.

Operating results for the three and six months ended June 30, 2021 are not

necessarily indicative of the results that may be expected for the entire year or for any other subsequent interim period.

information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant

to the rules of the U.S.

Securities and Exchange Commission (the “SEC”).

These unaudited condensed consolidated financial

statements and related notes should be read in conjunction with the Company’s audited financial statements for the year ended December

31, 2020 included in the Company’s Annual Report on Form 10-K filed with the SEC on April 30, 2021.

statements and related notes should be read in conjunction with the Company’s audited financial statements for the year ended December

31, 2020 included in the Company’s Annual Report on Form 10-K filed with the SEC on April 30, 2021.

of Consolidation

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Intercompany accounts and transactions have been eliminated upon consolidation.

Reclassifications

the three months ended March 31, 2020, the Company reclassified $2,580,110 related to the write-off of unamortizaed debt discount on

convertible notes to reorganization items on the unaudited condensed consolidated statements of operations.

This amount was previously

recorded as interest expense in the Company’s Quarterly Report on Form 10-Q filed with the SEC on March 29, 2021.

This reclassification

had no effect on net loss or cash flows as previously reported.

11 Accounting

unaudited condensed consolidated financial statements included herein have been prepared as if we were a going concern and in accordance

with Accounting Standards Codification (“ASC”) 852, Reorganizations .

industry conditions in 2019 negatively impacted the Company’s results of operations and cash flows and may continue to do so in

In order to decrease the Company’s indebtedness and maintain the Company’s liquidity levels suifficient to meet

its commitments, the Company undertook a number of actions, including minimizing capital expendtiures and further reducing its recurring

with Accounting Standards Codification (“ASC”) 852, Reorganizations .

industry conditions in 2019 negatively impacted the Company’s results of operations and cash flows and may continue to do so in

In order to decrease the Company’s indebtedness and maintain the Company’s liquidity levels sufficient to meet

its commitments, the Company undertook a number of actions, including minimizing capital expenditures and further reducing its recurring

operating expenses.

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debt service obligations and meet its other financial obligations.

On March 20, 2020 (the “Petition Date”), the Company filed

a voluntary petition commencing a case under chapter 11 of title 11 of the U.S.

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District of New York.

On August 7, 2020, the Company and Auctus, the Company’s largest unsecured creditor and a stockholder as

of the Petition Date, filed an Amended Joint Plan of Reorganization (the “Plan”).

On November 16, 2020 (the “Effective

Date”), the Plan became effective.

On August 7, 2020, the Company and Auctus, the Company’s largest unsecured creditor and a stockholder as

of the Petition Date, filed an Amended Joint Plan of Reorganization (the “Plan”) and on October 30, 2020, the Bankruptcy

Court entered an order (the “Confirmation Order”) confirming the Plan, as amended.

Amendments to the Plan are reflected in

the Confirmation Order.

On November 16, 2020 (the “Effective Date”), the Plan became effective.

Reorganization

Company incurred costs after the Petition Date associated with the reorganization, primarily unamortized debt discount and postpetition

Company incurred costs after the Petition Date associated with the reorganization, primarily unamortized debt discount and post petition

professional fees.

In accordance with applicable guidance, costs associated with the bankruptcy proceedings have been recorded as reorganization

items, net within the accompanying unaudited condensed consolidated statements of operations for the three months ended March 31, 2021

Reorganization items, net for the three months ended March 31, 2021 and 2020, were $- and $2,580,110, respectively, representing

cash used in operating activities.

items, net within the accompanying unaudited condensed consolidated statements of operations for the three and six months ended June

30, 2021 and 2020.

Reorganization items, net for the three and six months ended June 30, 2021 were $ - and for the three and six months

ended June 30, 2020, were $ 3,361,416 and $ 781,306 , respectively, representing cash used in operating activities.

Reorganization

items, net for the three months ended March 31, 2021 and 2020, consisted of the following:

Three Months Ended March 31, 2021

items, net for the three and six months ended June 30, 2020, consisted of the following:

OF REORGANIZATION ITEMS, NET

Three Months Ended June 30, 2020

Six Months Ended June 30, 2020

Professional fees

$ ( 149,690 )

Write-off of derivative liability

Default interest and penalties

Unamortized debt discount on convertible notes

( 2,580,110 )

Total reorganization items, net

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assumptions on historical experience, known or expected trends and various other assumptions that it believes to be reasonable.

events and their effects cannot be determined with precision, actual results could differ from these estimates which may cause the Company’s

future results to be affected.

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assets, deferred tax asset and valuation allowance, estimated fair value of derivative liabilities stemming from convertible debt securities,

and assumptions used in the Black-Scholes-Merton pricing model, such as expected volatility, risk-free interest rate, and expected divided

Company derives all of its revenue pursuant to a license agreement between the Company and a stem cell treatment company (“SCTC”)

assumptions used in management’s liquidity analysis, and assumptions used in the Black-Scholes-Merton pricing model, such as expected

volatility, risk-free interest rate, and expected divided rate.

Company derives all of its revenue pursuant to a license agreement between the Company and a stem cell treatment company (“SCTC”)

entered into in January 2012, as amended in November 2015.

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part of ASC Topic 606, the Company has adopted several practical expedients including:

Financing Component –

the Company does not adjust the promised amount of consideration for the effects of a significant financing

Financing Component – the Company does not adjust the promised amount of consideration for the effects of a significant financing

component since the Company expects, at contract inception, that the period between when the Company transfers a promised good or

service to the customer and when the customer pays for that good or service will be one year or less.

Performance Obligations –

all performance obligations related to contracts with a duration for less than one year, the Company

Performance Obligations – all performance obligations related to contracts with a duration for less than one year, the Company

has elected to apply the optional exemption provided in ASC Topic 606 and therefore, is not required to disclose the aggregate amount

of transaction price allocated to performance obligations that are unsatisfied or partially satisfied at the end of the reporting

to Invoice –

the Company has a right to consideration from a customer in an amount that corresponds directly with the value

to the customer of the Company’s performance completed to date.

to Invoice – the Company has a right to consideration from a customer in an amount that corresponds directly with the value

to the customer of the Company’s performance completed to date.

The Company may recognize revenue in the amount to which the

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Modifications

were no contract modifications during the three months ended March 31, 2021.

were no contract modifications during the three and six months ended June 30, 2021.

Contract modifications are not routine in the performance

of the Company’s contracts.

Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents.

There were no cash equivalents as of March 31, 2021 or December 31, 2020.

There were no cash equivalents as of June 30, 2021 or December 31, 2020.

receivable are reported at their outstanding unpaid principal balances, net of allowances for doubtful accounts.

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The Company provides for allowances

for doubtful receivables based on management’s estimate of uncollectible amounts considering age, collection history, and any other

factors considered appropriate.

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the allowance for doubtful accounts when a balance is determined to be uncollectible.

The Company did not record an allowance for doubtful

accounts as of March 31, 2021 and December 31, 2020, respectively.

The Company did no t record an allowance for doubtful

accounts as of June 30, 2021 and December 31, 2020, respectively.

and Equipment

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Expenditures that enhance the useful lives of the assets are capitalized and depreciated.

equipment costs are capitalized, as incurred, and depreciated on a straight-line basis over a range of 3 –

equipment costs are capitalized, as incurred, and depreciated on a straight-line basis over a range of 3 – 5 years .

improvements are amortized over the lesser of (i) the useful life of the asset, or (ii) the remaining lease term.

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of the assets.

During the three months ended March 31, 2021 and 2020, the Company determined that there was no impairment charge for

intangible assets.

Company records its intangible assets at cost in accordance with ASC 350, Intangibles –

Goodwill and Other.

During the three and six months ended

June 30, 2021 and 2020, the Company determined that there was no impairment charge for intangible assets.

Company records its intangible assets at cost in accordance with ASC 350, Intangibles – Goodwill and Other.

Definite lived intangible

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Advertising and marketing expenses were $ 6,220 and $ 6,123 for

the three months ended March 31, 2021 and 2020, respectively.

The above advertising and marketing expenses are recorded in marketing

and promotion on the unaudited condensed consolidated statements of operations.

the three months ended June 30, 2021 and 2020, respectively.

Advertising and marketing expenses were $ 8,820 and $ 28,131 for the six months

ended June 30, 2021 and 2020, respectively.

The above advertising and marketing expenses are recorded in marketing and promotion on the

unaudited condensed consolidated statements of operations.

Value Measurements

defined in ASC 820, “Fair Value Measurements and Disclosures,”

fair value is the price that would be received to sell an

defined in ASC 820, “Fair Value Measurements and Disclosures,” fair value is the price that would be received to sell an

asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price).

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These inputs may be used with internally

developed methodologies that result in management’s best estimate of fair value.

Loss per Common Share

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The dilutive effect, if any, of stock options, warrants,

and unvested restricted stock units (“RSUs”) are calculated using the treasury stock method.

All outstanding convertible

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Since the effect of common stock equivalents is anti-dilutive with respect to losses, options, warrants, RSUs and convertible notes have

been excluded from the Company’s computation of net loss per common share for the three months ended March 31, 2021 and 2020.

been excluded from the Company’s computation of net loss per common share for the three and six months ended June 30, 2021 and

following table summarizes the securities that were excluded from the diluted per share calculation because the effect of including these

potential shares was antidilutive:

OF WEIGHTED AVERAGE DILUTIVE COMMON SHARES

Three Months Ended

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1,173,917,974

Convertible notes –

Convertible notes – common stock

795,797,190 (1)

18,829,294,505

Six Months Ended

2,352,191,115

14,507,388,226

of Marh 31, 2021 all of the convertible notes had variable conversion prices and the shares issuable were estimated based on the

market conditions.

Pursuant to the note agreements, there were 6,078,578,968 shares of common stock reserved for future note

conversions as of March 31, 2021.

of March 31, 2020 many of the convertible notes had variable conversion prices and the shares issuable were estimated based on the

Unvested RSUs

1,173,917,974

Convertible notes – common stock

795,797,190 (1)

18,829,294,505

of June 30, 2021 all of the convertible notes had variable conversion prices and the shares issuable were estimated based on the

market conditions.

Pursuant to the note agreements, there were 51,504,015,462 shares of common stock reserved for future note conversions

as of March 31, 2020.

Company applies the provisions of ASC 718, Compensation—Stock Compensation (“ASC 718”), which requires the measurement

as of June 30, 2021.

Company applies the provisions of ASC 718, Compensation—Stock Compensation (“ASC 718”), which requires the measurement

and recognition of compensation expense for all stock-based awards made to employees, including employee stock options, in the statements

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Forfeitures are recorded as they are incurred as opposed to being estimated at the time of grant and revised.

to Accounting Standards Update (“ASU”) 2018-07 Compensation –

Stock Compensation (Topic 718):

to Accounting Standards Update (“ASU”) 2018-07 Compensation – Stock Compensation (Topic 718):

Improvements to Nonemployee

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stock options noted above.

the shares underlying the Company’s 2010 Equity Participation Plan and the 2021 Stock Incentive Plan (the “Plans”)

are registered, the Company estimates the fair value of the awards granted under the Plans based on the market value of its freely tradable

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On February 3, 2020, the Company was advised by OTC Markets Group that, based upon the closing

bid price of the Company’s common stock being less than $0.001 per share for five consecutive trading days, the Company’s

bid price of the Company’s common stock being less than $ 0.001 per share for five consecutive trading days, the Company’s

common stock was moved from the OTCQB Market to the Pink Market effective at market open on February 10, 2020.

The fair value of the

Company’s restricted equity instruments was estimated by management based on observations of the cash sales prices of both restricted

shares and freely tradable shares.

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and liabilities and the related financial amounts, using currently enacted tax rates.

A valuation allowance is recorded when it is “more

likely than not”

that a deferred tax asset will not be realized.

At March 31, 2021 and December 31, 2020, the Company’s net

A valuation allowance is recorded when it is “more

likely than not” that a deferred tax asset will not be realized.

At June 30, 2021 and December 31, 2020, the Company’s net

deferred tax asset has been fully reserved.

uncertain tax positions that meet a “more likely than not”

threshold, the Company recognizes the benefit of uncertain tax

uncertain tax positions that meet a “more likely than not” threshold, the Company recognizes the benefit of uncertain tax

positions in the unaudited condensed consolidated financial statements.

The Company’s practice is to recognize interest and penalties,

if any, related to uncertain tax positions in income tax expense in the unaudited condensed consolidated statements of operations when

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Company evaluates its convertible instruments to determine if those contracts or embedded components of those contracts qualify as derivative

financial instruments to be separately accounted for in accordance with Topic 815 of the Financial Accounting Standards Board (“FASB”)

The accounting treatment of derivative financial instruments requires that the Company record embedded conversion options (“ECOs”)

financial instruments to be separately accounted for in accordance with Topic 815 of the Financial Accounting Standards Board (“FASB”)

The accounting treatment of derivative financial instruments requires that the Company record embedded conversion options (“ECOs”)

and any related freestanding instruments at their fair values as of the inception date of the agreement and at fair value as of each

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volatility during the most recent historical period of time equal to the weighted average life of the instruments.

ASC 815-40-35 (“ASC 815”), the Company has adopted a sequencing policy, whereby, in the event that reclassification of contracts

from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient

ASC 815-40-35 (“ASC 815”), the Company has adopted a sequencing policy, whereby, in the event that reclassification of contracts

from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient

authorized shares as a result of certain securities with a potentially indeterminable number of shares, shares will be allocated on the

basis of the earliest issuance date of potentially dilutive instruments, with the earliest grants receiving the first allocation of shares.

Pursuant to ASC 815, issuances of securities to the Company’s employees and directors, or to compensate grantees in a share-based

payment arrangement, are not subject to the sequencing policy.

February 2016, the FASB issued ASU No.

2016-02, Leases (“ASU 2016-02”)).

The standard requires all leases that have a term

of over 12 months to be recognized on the balance sheet with the liability for lease payments and the corresponding right-of-use (“ROU”)

asset initially measured at the present value of amounts expected to be paid over the term.

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its office space lease agreement.

See Note 8 - Leases for further discussion, including the impact on the Company’s unaudited condensed

consolidated financial statements and related disclosures.

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All of the leases are classified as operating leases.

has a lease agreement for office space with a remaining term of 3.75 years as of March 31, 2021.

Subsequent Events

There were no

subsequent events or transactions requiring recognition or disclosure in the unaudited condensed consolidated financial statements,

and noted thereto, through the date the financial statements were issued.

has a lease agreement for office space with a remaining term of 3.5 years as of June 30, 2021.

Issued Accounting Standards

March 2021, the FASB issued ASU 2021-03, Intangibles –

Goodwill and Other (Topic 350) (“ASU 2021-03”) which requires

an entity to identify and evaluate goodwill impairment triggering events when they occur to determine whether it is more likely than

not that the fair value of a reporting unit (or entity, if the entity has elected the accounting alternative for amortizing goodwill

and chosen that option) is less than its carrying amount.

If an entity determines that it is more likely than not that the goodwill is

impaired, it must test goodwill for impairment using the triggering event date as the measurement date.

An entity is required to disclose

the amount assigned to goodwill in total and by major business combination, or by reorganization event resulting in fresh-start-start

Also, the weighted average amortization period in total and the amortization period by major business combination, or by reorganization

event resulting in fresh-start reporting.

ASU 2021-03 was effective for the Company on January 1, 2021 and did not have a significant

impact on its unaudited condensed consolidated financial statement.

May 2021, the FASB issued ASU 2021-04 “Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50),

Compensation—

Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic

815- 40) Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options”

which clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified

May 2021, the FASB issued ASU 2021-04 “Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50),

Compensation— Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic

815- 40) Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options”

which clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified

written call options (for example, warrants) that remain equity classified after modification or exchange.

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i) for a modification or an exchange that is a part of or directly related to a modification or

an exchange of an existing debt instrument or line-of-credit or revolving-debt arrangements (hereinafter, referred to as a “debt”

or “debt instrument”), as the difference between the fair value of the modified or exchanged written call option and the

an exchange of an existing debt instrument or line-of-credit or revolving-debt arrangements (hereinafter, referred to as a “debt”

or “debt instrument”), as the difference between the fair value of the modified or exchanged written call option and the

fair value of that written call option immediately before it is modified or exchanged;

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3 – INTANGIBLE ASSETS

Company is a party to a license agreement with the SCTC (as amended) (the “SCTC Agreement”).

Pursuant to the SCTC Agreement,

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In February 2017, the Company received authorization from the Food and

Drug Administration (the “FDA”) to proceed with a Phase 2 clinical trial.

Based upon such authorization, the Company has

5 unchanged sentences

assets consist of the following:

OF INTANGIBLE ASSETS BY MAJOR CLASS

Patents and Trademarks

1 unchanged sentence

Balance as of January 1, 2020

$ ( 566,012 )

Amortization expense

1 unchanged sentence

Amortization expense

Balance as of March 31, 2021

Weighted average remaining amortization period at March 31, 2021 (in years)

Amortization of intangible

assets consists of the following:

Balance as of June 30, 2021

$ ( 678,172 )

Weighted average remaining amortization period at June 30, 2021 (in years)

of intangible assets consists of the following:

OF FINITE LIVED INTANGIBLE ASSETS AMORTIZATION EXPENSES

Patents and Trademarks

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Amortization expense

Balance as of March 31, 2021

Balance as of June 30, 2021

4 – ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

expenses and other current liabilities consist of:

OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

June 30, 2021

Accrued payroll

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Accrued general and administrative expenses

DIP and Plan costs related to DIP Funding and Plan (1)

Accrued DIP and Plan costs related to DIP Funding and Plan (1)

Total accrued expenses

1 unchanged sentence

5 – NOTES PAYABLE

summary of the notes payable activity during the three months ended March 31, 2021 is presented below:

summary of the notes payable activity during the six months ended June 30, 2021 is presented below:

OF NOTES PAYABLE ACTIVITY

Convertible Notes

4 unchanged sentences

Amortization of debt discount

Outstanding, March 31, 2021

Outstanding, June 30, 2021

$ ( 4,542,205 )

3 unchanged sentences

States Bankruptcy Court for the Eastern District of New York.

On August 7, 2020, the Company and Auctus, the Company’s largest

unsecured creditor and a stockholder as of the Petition Date, filed an Amended Joint Plan of Reorganization (the “Plan”).

Pursuant to the Bankruptcy, for any outstanding principal and interest at the date of the Company’s Chapter 11 petition (except

for creditors who provided additional debt financing in connection with the Bankruptcy), 100 shares of the Company’s common stock

On August 7, 2020, the Company and Auctus, the Company’s largest

unsecured creditor and a stockholder as of the Petition Date, filed an Amended Joint Plan of Reorganization (the “Plan”).

Pursuant to the Bankruptcy, for any outstanding principal and interest at the date of the Company’s Chapter 11 petition (except

for creditors who provided additional debt financing in connection with the Bankruptcy), 100 shares of the Company’s common stock

were issued for each dollar of allowed claim, with such shares subject to leak-out restrictions prohibiting the holder from selling,

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subject to the conversion rights outlined above.

October 30, 2020, the Bankruptcy Court entered an order (the “Confirmation Order”) confirming the Plan, as amended.

to the Plan are reflected in the Confirmation Order.

On November 16, 2020 (the “Effective Date”), the Plan became effective.

material features of the Plan, as amended and confirmed by the Confirmation Order, are as follows:

of the financing to the Company by Auctus of up to $ 7,000,000 which Auctus has provided or committed to provide consisting of the

debtor-in-possession loans made to the Company by Auctus during the Chapter 11 Case (the “DIP Funding”) and additional

funding as described below.

has provided $3,500,000 in funding to the Company (the “Initial Auctus Funding”) and is to provide, subject to certain

has provided $ 3,500,000 in funding to the Company (the “Initial Auctus Funding”) and is to provide, subject to certain

conditions, additional funding to the Company, as needed, in an amount equal to $ 3,500,000 , less the sum of the debtor-in-possession

loans made to the Company by Auctus during the Chapter 11 Case (inclusive of accrued interest) (approximately $ 1,227,000 as of the

Effective Date) and the costs incurred by Auctus as the debtor-in-possession lender (the “DIP Costs”).

As of March 31,

2021, the DIP Costs and additional Plan costs were not finalized and recorded.

The DIP Costs and the additional Plan costs in the

aggregate are estimated to total $657,598, of which $500,000 and $157,598 were recorded in debt discount and accrued expenses, respectively,

on the consolidated balance sheets.

In addition, four other persons and entitles (collectively, the “Other Lenders”)

who held allowed general unsecured claims provided funding to the Company in the aggregate amount of approximately $348,000 (the

“Other Funding”

and together with the Initial Auctus Funding, the “Funding”).

In consideration of the Funding,

the Company has issued the following:

convertible notes of the Company (each, a “Secured Convertible Note”) in the principal amount equal to the Funding;

payment of the Secured Convertible Notes is secured by the grant of a security interest in substantially all of the Company’s

Effective Date) and the costs incurred by Auctus as the debtor-in-possession lender (the “DIP Costs”).

The DIP Costs

and the additional Plan costs in the aggregate totaled $ 650,493 , of which $ 500,000 and $ 150,493 were recorded in debt discount and

accrued expenses, respectively, on the consolidated balance sheets (See Note 9).

In addition, four other persons and entitles (collectively,

the “Other Lenders”) who held allowed general unsecured claims provided funding to the Company in the aggregate amount

of approximately $ 348,000 (the “Other Funding” and together with the Initial Auctus Funding, the “Funding”).

In consideration of the Funding, the Company has issued the following:

convertible notes of the Company (each, a “Secured Convertible Note”) in the principal amount equal to the Funding;

payment of the Secured Convertible Notes is secured by the grant of a security interest in substantially all of the Company’s

the Secured Convertible Notes have the following features:

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on the same terms as provided to investors in connection with a public offering undertaken in connection with such listing;

(each, a “Class A Warrant”) to purchase a number of shares of common stock equal to the amount of the Funding provided

divided by $ 0.0005 (a total of 7,000,000,000 Class A Warrants in consideration of the Initial Auctus Funding and a total of approximately

1 unchanged sentence

of $ 0.0005 per share;

(each, a “Class B Warrant”

and together with the Class A Warrants, the “Plan Warrants”) to purchase a number

(each, a “Class B Warrant” and together with the Class A Warrants, the “Plan Warrants”) to purchase a number

of shares of common stock equal to the Funding provided divided by $ 0.001 (a total of 3,500,000,000 Class B Warrants in consideration

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stock, of which 217,796,200 and 453,328,000 were issued during 2020 and 2021, respectively).

addition, Auctus shall be entitled to receive a Secured Convertible Note in exchange for its allowed DIP Costs and allowed Plan costs

in a manner in which the DIP Funding was treated and may be entitled to a Class A Warrant and a Class B Warrant in consideration of such

addition, Auctus shall be entitled to receive a Secured Convertible Note in exchange for its allowed DIP Costs of $ 166,403 and allowed

Plan costs of $ 484,090 , in a manner in which the DIP Funding was treated and shall be entitled to a Class A Warrant and a Class B Warrant

in consideration of its allowed DIP costs.

claim arising from the secured promissory notes of the Company, dated February 20, 2020 and February 26, 2020, in the original principal

amounts of $320,200 and $33,562, respectively, issued to John Desmarais (“Desmarais”) (collectively, the “Desmarais

Notes”), was treated as an allowed secured claim in the aggregate amount of $490,699 and was exchanged for a Secured Convertible

amounts of $ 320,200 and $ 33,562 , respectively, issued to John Desmarais (“Desmarais”) (collectively, the “Desmarais

Notes”), was treated as an allowed secured claim in the aggregate amount of $ 490,699 and was exchanged for a Secured Convertible

Note in such amount.

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an aggregate of approximately $ 382,400 in the case of the Other Lenders), a convertible promissory note of the Company (each, an

“Unsecured Convertible Note”) in the allowed amount of the claim, which Unsecured Convertible Notes have the following

material features:

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and the par value of the shares of common stock has been reduced to $ 0.0001 per share.

Company recorded $142,692 and $362,041 of interest expense related to notes payable and convertible note payable for the three

months ended March 31, 2021 and 2020, respectively.

Company recorded $ 143,721 and $ - of interest expense related to notes payable and convertible note payable for the three months ended

June 30, 2021 and 2020, respectively.

The Company recorded $ 286,414 and $ 368,810 of interest expense related to notes payable and convertible

note payable for the six months ended June 30, 2021 and 2020, respectively.

Exchanges and Other

the three months ended March 31, 2021, certain lenders converted unsecured convertible notes with with an aggegate amount of $213,673

(including $2,611 of accrued interest) for an aggregate of 19,409,575 shares of the Company’s common stock at a conversion

price of $0.01 per share.

the six months ended June 30, 2021, certain lenders converted unsecured convertible notes with an aggregate amount of $ 317,894 (including

$ 6,314 of accrued interest) for an aggregate of 32,276,310 shares of the Company’s common stock at a conversion price of $ 0.01

Debtor-in-Possession

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to the Plan, the obligation to Auctus with respect to the DIP Funding has been exchanged for two Secured Convertible Notes (See Note

Notes Payable –

Chapter 11 Reorganization) for an aggregate principal amount of $1,349,591 which bear interest at 7%

5 – Notes Payable – Chapter 11 Reorganization) for an aggregate principal amount of $ 1,349,591 which bear interest at 7 %

per annum with a maturity date of November 16, 2023 .

In connection with the Secured Convertible Notes, Auctus received warrants to purchase

an aggregate of 3,680,703,720 shares of Company’s commons stock with exercise prices ranging between $0.0005 and $0.001 per share.

expense for the two Secured Convertible Notes was $23,294 for the three months ended March 31, 2021.

an aggregate of 3,680,703,720 shares of Company’s commons stock with exercise prices ranging between $ 0.0005 and $ 0.001 per share.

expense for the two Secured Convertible Notes was $ 23,553 and $ 46,847 for the three and six months ended June 30, 2021, respectively.

Interest expense during the three and six months ended June 30, 2020 was $ 6,769 .

March 14, 2021, under the U.S.

Small Business Administration’s Paycheck Protection Program, the Company entered into a note payable

with a financial institution for $ 250,000 at an interest rate of 1 % per annum and a maturity date of March 14, 2026.

3 unchanged sentences

of $ 5,100 starting on January 14, 2022.

As of March 31, 2021, the Company has not applied for loan forgiveness.

All remaining unpaid

principal and interest is due and payable at the maturity date.

At March 31, 2021, $250,000 was outstanding.

minimum payments under the above notes payable following the three months ended March 31, 2021, are as follows:

As of June 30, 2021, the Company has not applied for loan forgiveness.

All remaining unpaid principal

and interest is due and payable at the maturity date.

At June 30, 2021, $ 250,000 was outstanding.

minimum payments under the above notes payable following the six months ended June 30, 2021 are as follows:

OF FUTURE MINIMUM PAYMENTS OF NOTES PAYABLE

Remainder of 2021

Total future minimum payments

Stockholders’

( 4,542,205 )

payable, non-current

6 – STOCKHOLDERS' DEFICIT

Incentive Plan

March 18, 2021, the Company’s Board of Directors adopted the BioRestorative Therapies, Inc.

2021 Stock Incentive Plan (the “2021

Plan”).

March 18, 2021, the Company’s Board of Directors adopted the BioRestorative Therapies, Inc.

2021 Stock Incentive Plan (the “2021

Pursuant to the 2021 Plan, a total of 4,700,000,000 shares of common stock are authorized to be issued pursuant to the

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directors is the estimated period of time that options granted are expected to be outstanding.

The Company utilizes the “simplified”

method to develop an estimate of the expected term of “plain vanilla”

employee option grants.

The Company utilizes the “simplified”

method to develop an estimate of the expected term of “plain vanilla” employee option grants.

The Company is utilizing an

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applying the Black-Scholes option pricing model to warrants granted or issued, the Company used the following assumptions:

the Three Months Ended

free interest rate

weighted average estimated fair value of warrants granted during the three months ended March 31, 2020 was $0.01 per

the three months ended March 31, 2021, the Company issued an aggregate of 294,328,000 shares of the Company’

common stock, as a

result of the cashless exercise of 313,019,749 warrants to Auctus.

summary of the warrant activity during the three months ended March 31, 2021 is presented below:

January 1, 2021

OF WARRANTS GRANTED ASSUMPTION

For the Six Months Ended

Risk free interest rate

Contractual term (years)

Expected volatility

weighted average estimated fair value of warrants granted during the six months ended June 30, 2020 was $ 0.01 per share.

the six months ended June 30, 2021, the Company issued an aggregate of 453,328,000 shares of the Company’ common stock, as a result

of the cashless exercise of 494,604,977 warrants to Auctus.

summary of the warrant activity during the six months ended June 30, 2021 is presented below:

OF WARRANT ACTIVITY

Outstanding, January 1, 2021

15,002,388,203

( 494,604,977 )

March 31, 2021

Outstanding, June 30, 2021

14,507,388,226

Exercisable, June 30, 2021

14,507,388,226

March 31, 2021

following table presents information related to stock warrants at June 30, 2021:

OF STOCK WARRANTS

Warrants Outstanding

Warrants Exercisable

Remaining Life

$ 0.00 - $ 0.015

14,501,064,290

following table presents information related to stock warrants at March 31, 2021:

14,501,064,290

2 unchanged sentences

$ 3.00 - $ 3.99

$ 4.00 - $ 4.99

$ 5.00 - $ 5.99

14,507,388,226

applying the Black-Scholes option pricing model to stock options granted, the Company used the following assumptions:

For the Three Months Ended

OF STOCK OPTION GRANTED ASSUMPTIONS

For the Six Months Ended

Risk free interest rate

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Expected dividends

Company granted options for the purchase of 2,347,835,948 shares of common stock during the three months ended March 31, 2021.

Company did not issue stock options during the three months ended March 31, 2020.

The grant date fair value of options issued during the three months ended March 31, 2021 was $27,736,052.

summary of the option activity during the three months ended March 31, 2021 is presented below:

January 1, 2021

Company granted options for the purchase of 2,347,835,948 shares of common stock during the six months ended June 30, 2021.

Company did not issue stock options during the six months ended June 30, 2020.

grant date fair value of options issued during the six months ended June 30, 2021 was $ 27,736,052 .

summary of the option activity during the six months ended June 30, 2021 is presented below:

OF STOCK OPTION ACTIVITY

Outstanding, January 1, 2021

2,347,835,948

March 31, 2021

Outstanding, June 30, 2021

2,352,191,115

March 31, 2021

Exercisable, June 30, 2021

1,178,631,812

following table presents information related to stock options at March 31, 2021:

following table presents information related to stock options at June 30, 2021:

OF OPTION BY EXERCISE PRICE

Options Outstanding

Options Exercisable

Remaining Life

$ 0.00 - $ 0.0119

2 unchanged sentences

$ 0.26 - $ 0.74

$ 0.75 - $ 0.99

$ 1.00 - $ 5.99

$ 6.00 - $ 19.99

$ 20.00 - $ 30.00

2,352,191,115

1,178,131,812

March 18, 2021, the Company, pursuant to two employment agreements, granted to its Chief Executive Officer and Chairman of the Board

and its Vice President, Research and Development options to purchase an aggregate of 2,347,835,948 shares of the Company’s common

stock (See Note 7 –

Commitments and Contingencies).

and its Vice President, Research and Development options to purchase an aggregate of 2,347,835,948 shares of the Company’s common

stock (See Note 7 – Commitments and Contingencies).

The options have an exercise price of $ 0.0119 per share and vest to the extent

of 50% on the date of grant, 25% on the one-year anniversary of the grant date, and 25% on the two-year anniversary of the grant date.

to the 2021 Plan, the Company grants RSUs to employees, consultants, or non-employee directors (“Eligible Individuals”).

The number, terms, and conditions of the RSUs that are granted to Eligible Individuals are determined on an individual basis by the plan

administrator.

On the distribution date, the Company shall issue to the Eligible Individual one unrestricted, fully transferable

share of the Company’s common stock (or the fair market value of one such share in cash) for each vestded and nonforfeitable RSU.

On the distribution date, the Company shall issue to the Eligible Individual one unrestricted, fully transferable share

of the Company’s common stock (or the fair market value of one such share in cash) for each vested and nonforfeitable RSU.

March 18, 2021, the Company, pursuant to two employment agreements, granted an aggregate of 1,173,917,974 RSUs to its Chief Executive

Officer and Chairman of the Board and its Vice President, Research and Development (See Note 7 –

Commitments and Contingencies)

Officer and Chairman of the Board and its Vice President, Research and Development (See Note 7 – Commitments and Contingencies)

with a fair value of $ 0.0119 per share.

1 unchanged sentence

on the two-year anniversary of the grant date, and one-third on the three-year anniversary of the grant date.

summary of our unvested RSUs as of March 31, 2021 is as follows:

January 1, 2021

summary of our unvested RSUs as of June 30, 2021 is as follows:

OF UNVESTED RESTRICTED STOCK UNITS

Outstanding, January 1, 2021

1,173,917,974

March 31, 2021

Outstanding, June 30, 2021

1,173,917,974

following table presents information related to stock compensation expense:

the Three Months Ended

and development

and administrative

OF STOCK OPTION EXPENSE

For the Three Months Ended

For the Six Months Ended

Unrecognized at

Research and development

General and administrative

7 - COMMITMENTS AND CONTINGENCIES

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Enterprises, LLC

February 11, 2020, pursuant to an Order to Show Cause of the United States District Court of the Eastern District of New York (the “Court”),

in the matter of Coventry Enterprises, LLC vs.

BioRestorative Therapies, Inc., pending the hearing of the plaintiff’s application

for a preliminary injunction, the Court issued a temporary restraining order enjoining the Company from issuing any additional shares

of stock except for purposes of fulfilling the plaintiff’s share reserve requests or conversion requests until such reserve requests

were fulfilled and enjoining the Company from reserving authorized shares for any other party until the plaintiff’s reserve requests

of stock except for purposes of fulfilling the plaintiff’s share reserve requests or conversion requests until such reserve requests

were fulfilled and enjoining the Company from reserving authorized shares for any other party until the plaintiff’s reserve requests

were fulfilled.

2 unchanged sentences

March 11, 2020, the Court ordered that the Company (i) convene and hold a special meeting, by no later than March 18, 2020, of the Board

of Directors of the Company (the “Board”), for approval of certain changes to the shares of the Company, as set forth below;

(ii) approve a reverse split and/or a stock consolidation, solely of the Company’s outstanding shares, at a ratio of 1,000 to 1,

(iii) approve of the continuation of the Company’s then total authorized shares of common stock at 2,000,000,000 shares;

of Directors of the Company (the “Board”), for approval of certain changes to the shares of the Company, as set forth below;

(ii) approve a reverse split and/or a stock consolidation, solely of the Company’s outstanding shares, at a ratio of 1,000 to 1,

(iii) approve of the continuation of the Company’s then total authorized shares of common stock at 2,000,000,000 shares;

to call a special meeting of stockholders of the Company, within ten days of the special meeting of the Board and by not later than March

2 unchanged sentences

approve the foregoing items, including the 1,000 to 1 reverse split, subject to the Company having available funds to effectuate such

As discussed above in Note 5 –

Notes Payable –

Chapter 11 Reorganization on March 20, 2020, the Company filed a petition

As discussed above in Note 5 – Notes Payable – Chapter 11 Reorganization on March 20, 2020, the Company filed a petition

commencing its Chapter 11 Case.

3 unchanged sentences

March 18, 2021, the Company and Lance Alstodt, its President, Chief Executive Officer and Chairman of the Board, entered into an employment

agreement (the “Alstodt Employment Agreement”) which provides for a term ending on March 18, 2026.

Pursuant to the Alstodt

1 unchanged sentence

Alstodt is entitled to receive initially an annual salary of $ 250,000 .

Alstodt’s annual salary will

increase by $ 50,000 per year.

In addition, in the event certain performance goals are met, Mr.

Alstodt’s salary will increase by

The Alstodt Employment Agreement also provides for the grant to Mr.

Alstodt pursuant to the Plan of (i) a ten year option for

the purchase of 1,173,917,974 shares of common stock of the Company and (ii) 586,958,987 RSUs of the Company (See Note 6 –

Stockholders’

the purchase of 1,173,917,974 shares of common stock of the Company and (ii) 5 86,958,987 RSUs of the Company (See Note 6 – Stockholders’

Deficit) for additional information.

March 18, 2021, the Company and Francisco Silva, its Vice President, Research and Development, entered into an employment agreement (the

“Silva Employment Agreement”) which provides for a term ending on March 18, 2026.

Pursuant to the Silva Employment Agreement,

Silva is entitled to receive initially an annual salary of $ 225,000 .

Silva’s annual salary will increase by $50,000 per

Silva’s annual salary will increase by $ 50,000 per

In addition, in the event certain performance goals are met, Mr.

Silva’s salary will increase by $150,000.

Silva’s salary will increase by $ 150,000 .

The Silva Employment

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Silva pursuant to the Plan of (i) a ten year option for the purchase of 1,173,917,974 shares

of common stock of the Company and (ii) 586,958,987 RSUs of the Company (See Note 6 –

Stockholders’

Deficit) for additional

of common stock of the Company and (ii) 586,958,987 RSUs of the Company (See Note 6 – Stockholders’ Deficit) for additional

of Convertible Notes

the year ended December 31, 2020 and prior to the Petition Date, certain lenders requested to exchange a portion of their outstanding

convertible note principal and accrued interest for shares of the Company’s common stock.

As of the Petition Date these shares

had yet to be issued to the lenders;

however, the shares of the Company’s common stock issued for unsecured claims as part of the

Plan to the certain lenders represented the aggregate unsecured claims less the principal and accrued interest that was represented in

the uneffected exchanges.

the unaffected exchanges.

The Company believes that there may be a potential contingency related to the non-issued shares that would

be settled in shares of the Company’s common stock and not monetary compensation.

June 24, 2021, the Company entered into a Settlement Agreement with one of the abovemention lenders, whereby the Company agreed to

issue 3,000,000 shares of the Company’s common stock in lieu of cash for an additional $ 30,000 of approved

unsecured claims related to the Plan.

The Company issued the 3,000,000 shares on July 16, 2021 (See Note 9).

the adoption of ASC 842, operating lease agreements are required to be recognized on the balance sheet as ROU assets and corresponding

lease liabilities.

Company is a party to a lease for 6,800 square feet of space located in Melville, New York (the “Melville Lease”) with respect

to its corporate and laboratory operations.

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following table presents net lease cost and other supplemental lease information:

Months Ended March 31, 2021

Months Ended March 31, 2020

lease cost (cost resulting from lease payments)

term lease cost

lease –

operating cash flows (fixed payments)

lease –

operating cash flows (liability reduction)

leases –

right of use assets

liabilities –

operating lease liabilities

liabilities –

operating lease liabilities

minimum payments under non-cancelable leases for operating leases for the remaining terms of the leases following the three months ended

March 31, 2021:

(excluding the three months ended March 31, 2021)

future minimum lease payments

representing interest

value of net future minimum lease payments

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Regarding Forward-Looking Statements

Quarterly Report on Form 10-Q includes a number of forward-looking statements that reflect management’s current views with respect

to future events and financial performance.

Forward-looking statements are projections in respect of future events or our future financial

In some cases, you can identify forward-looking statements by terminology such as “may,”

“should,”

“expects,”

“plans,”

“anticipates,”

“believes,”

“estimates,”

“predicts,”

“potential”

or “continue”

or the negative of these terms or other comparable terminology.

These statements include

statements regarding the intent, belief or current expectations of us and members of our management team, as well as the assumptions

on which such statements are based.

Prospective investors are cautioned that any such forward-looking statements are not guarantees of

future performance and involve risk and uncertainties, and that actual results may differ materially from those contemplated by such

forward-looking statements.

These statements are only predictions and involve known and unknown risks, uncertainties and other factors,

including the risks set forth in the section entitled “Risk Factors”

in our Annual Report on Form 10-K for the fiscal year

ended December 31, 2020, as filed with the U.S.

Securities and Exchange Commission (the “SEC”) on April 30, 2021, any of

which may cause our company’s or our industry’s actual results, levels of activity, performance or achievements to be materially

different from any future results, levels of activity, performance or achievements expressed or implied in our forward-looking statements.

These risks and factors include, by way of example and without limitation:

ability to obtain financing needed to commence and complete our clinical trials;

ability to successfully develop and commercialize BRTX-100, our lead product candidate for the treatment of chronic lumbar disc disease;

ability to retain exclusive rights with regard to our licensed technology;

ability to protect our proprietary rights;

ability to achieve and sustain profitability of the existing lines of business;

ability to attract and retain world-class research and development talent;

ability to attract and retain key science, technology and management personnel and to expand our management team;

accuracy of estimates regarding expenses, future revenue, capital requirements, profitability, and needs for additional financing;

interruptions resulting from geo-political actions, including war and terrorism or disease outbreaks (such as the recent outbreak

of COVID-19);

ability to attract and retain customers;

ability to navigate through the increasingly complex therapeutic regulatory environment.

we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels

of activity, or performance.

Except as required by applicable law, including the securities laws of the United States, we do not intend

to update any of the forward-looking statements to conform these statements to actual results.

are urged to carefully review and consider the various disclosures made by us in this report and in our other reports filed with the

We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated

events, or changes in the future operating results over time, except as required by law.

We believe that our assumptions are based upon

reasonable data derived from and known about our business and operations.

No assurances are made that actual results of operations or

the results of our future activities will not differ materially from our assumptions.

used in this Quarterly Report on Form 10-Q and unless otherwise indicated, the terms “Company,”

“we,”

“us,”

and “our”

refer to BioRestorative Therapies, Inc., a Delaware corporation (“BRT”), and its wholly-owned subsidiary,

Stem Pearls, LLC, a New York limited liability company (“Stem Pearls”).

Unless otherwise specified, all dollar amounts are

expressed in United States dollars.

report includes references to our federally registered trademarks, BioRestorative Therapies and Dragonfly design , BRTX-100,

ThermoStem and Stem Pearls .

We also own an allowed trademark application for BRTX .

The Dragonfly Logo is also registered with

This report also includes references to trademarks, trade names and service marks that are the property of

other organizations.

Solely for convenience, trademarks and trade names referred to in this report appear without the ®, SM

does not reflect upon the validity or enforceability of the intellectual property owned by us or third parties.

BioRestorative

Therapies, Inc.

has one wholly-owned subsidiary, Stem Pearls.

BioRestorative Therapies, Inc.

and its subsidiary are referred to collectively

as “BRT”

or the “Company”.

March 20, 2020 (the “Petition Date”), the Company filed a voluntary petition commencing a case (the “Chapter 11 Case”)

under Chapter 11 of title 11 of the U.S.

Code in the United States Bankruptcy Court for the Eastern District of New York (the “Bankruptcy

Court”).

August 7, 2020 the Company and Auctus Fund, LLC (“Auctus”), the Company’s largest unsecured creditor and a stockholder

as of the Petition Date, filed an Amended Joint Plan of Reorganization (the “Plan”) and on October 30, 2020, the Bankruptcy

Court entered an order (the “Confirmation Order”) confirming the Plan, as amended.

Amendments to the Plan are reflected in

the Confirmation Order.

On November 16, 2020 (the “Effective Date”), the Plan became effective.

See Note 5 –

Payable in Part I, Item I of this report for additional information.

develop therapeutic products and medical therapies using cell and tissue protocols, primarily involving adult (non-embryonic) stem cells.

We are currently pursuing our Disc/Spine Program with our initial investigational therapeutic product being called BRTX-100 .

We submitted an IND application to the FDA to obtain authorization to commence a Phase 2 clinical trial investigating the use of BRTX-100 ,

our lead cell therapy candidate, in the treatment of chronic lower back pain arising from degenerative disc disease.

We have received

such authorization from the FDA.

We intend to commence such clinical trial during 2021 (assuming the receipt of necessary funding).

have obtained a license to use technology for investigational adult stem cell treatment of disc and spine conditions, including protruding

and bulging lumbar discs.

The technology is an advanced stem cell injection procedure that may offer relief from lower back pain, buttock

and leg pain, and numbness and tingling in the leg and foot.

We are also developing our ThermoStem Program .

This pre-clinical

program involves the use of brown adipose (fat) in connection with the cell-based treatment of type 2 diabetes and obesity as well as

hypertension, other metabolic disorders and cardiac deficiencies.

United States patents related to the ThermoStem Program were

issued in September 2015, January 2019, March 2020 and March 2021;

a notice of allowance was also issued in March 2021 for a separate

United States patent application in the ThermoStem Program and is expected to issue in the next few months;

Australian patents

related to the ThermoStem Program were issued in April 2017 and October 2019;

a Japanese patent related to the ThermoStem Program

was issued in December 2017;

Israeli patents related to the ThermoStem Program were issued in October 2019 and May 2020;

European patents related to the ThermoStem Program were issued in April 2020 and January 2021.

have licensed a patented curved needle device that is a needle system designed to deliver cells and/or other therapeutic products or

materials to the spine and discs or other potential sites.

We anticipate that FDA approval or clearance will be necessary for this device

prior to commercialization.

We do not intend to utilize this device in connection with our contemplated Phase 2 clinical trial with regard

to BRTX-100 .

Company derives all of its revenue pursuant to a license agreement between the Company and a stem cell treatment company (“SCTC”)

entered into in January 2012, as amended in November 2015.

Pursuant to the license agreement, the SCTC granted to the Company a license

to use certain intellectual property related to, among other things, stem cell disc procedures and the Company has granted to the SCTC

a sublicense to use, and the right to sublicense to third parties the right to use, in certain locations in the United States and the

Cayman Islands, certain of the licensed intellectual property.

In consideration of the sublicenses, the SCTC has agreed to pay the Company

royalties on a per disc procedure basis.

of Operations

of the Three Months Ended March 31, 2021 to the Three Months Ended March 31, 2020

financial results for the three months ended March 31, 2021 are summarized as follows in comparison to the three months ended March 31,

The Three Months Ended

and promotion

and development

and administrative

Operating Expenses

From Operations

(15,054,656 )

of debt discount

on extinguishment of notes payable, net

in fair value of derivative liabilities

Reorganization

Other Expense

$ (15,653,330 )

the three months ended March 31, 2021 and 2020, we generated $18,000 and $26,000, respectively, of royalty revenue in connection with

our sublicense agreement.

and Promotion

and promotion expenses include advertising and promotion, marketing and seminars, meals, entertainment and travel expenses.

For the three

months ended March 31, 2021, marketing and promotion expenses decreased by $19,408, or 88%, from $22,008 to $2,600 as compared to the

three months ended March 31, 2020.

The decrease is primarily due to the Company’s reduced marketing plan as the Company continues

to emerge from its Chapter 11 reorganization.

expect that marketing and promotion expenses will increase in the future as we increase our marketing activities following full commercialization

of our products and services.

expenses consist of consulting fees and stock-based compensation to consultants.

For the three months ended March 31, 2021, consulting

expenses decreased by $25,623, or 75%, from $34,012 to $8,389, as compared to the three months ended March 31, 2020.

The decrease is

primarily due to the Company’s reduced usage of consultants as the Company continues to emerge from its Chapter 11 reorganization.

and Development

and development expenses include cash and non-cash compensation of (a) our Vice President of Research and Development;

(b) our Scientific

Advisory Board members;

and (c) laboratory staff and costs related to our brown fat and disc/spine initiatives.

Research and development

expenses are expensed as they are incurred.

For the three months ended March 31, 2021, research and development expenses decreased by

$21,075, or 11%, from $186,328 to $165,254, as compared to the three months ended March 31, 2020.

The decrease is primarily due to the

decrease of approximately $35,000 in stock compensation allocated to the Company’s research and development activities.

expect that our research and development expenses will increase with the recommencement of our research and development initiatives during

the year ending December 31, 2021.

and Administrative

and administrative expenses consist primarily of salaries, bonuses, payroll taxes, severance costs and stock-based compensation to employees

(excluding any cash or non-cash compensation of our Vice President of Research and Development and our laboratory staff), as well as

corporate expenses such as legal and professional fees, investor relations and occupancy related expenses.

For the three months ended

March 31, 2021, general and administrative expenses increased by $14,293,772, or 2,372%, from $602,641 to $14,896,413, as compared to

the three months ended March 31, 2020.

The increase is primarily due to an increase of approximately $14,077,000 in stock-based compensation

resulting from the issuances of 2,347,835,948 stock options and 1,173,917,974 RSUs.

expect that our general and administrative expenses will further increase as we expand our staff, develop our infrastructure and incur

additional costs to support the growth of our business.

the three months ended March 31, 2021, interest expense decreased $104,412, or 37%, as compared to the three months ended March 31, 2020.

The decrease was due to the decrease in outstanding notes payable as a result of our restructuring under our Chapter 11 reorganization.

of debt discount

the three months ended March 31, 2021, amortization of debt discount decreased $649,366, or 61%, as compared to the three months ended

March 31, 2020.

The decrease was due to the decrease in outstanding notes payable as a result of our restructuring under our Chapter

11 reorganization.

on extinguishment of notes payable, net

the three months ended March 31, 2021, we did not record a loss on extinguishment of notes payable, as compared to a loss on extinguishment

of notes payable of $658,152 for the three months ended March 31, 2020.

in fair value of derivative liabilities

the three months ended March 31, 2021, we did not record a gain (loss) related to the change in fair value of derivative liabilities,

as compared to a loss related to the change in fair value of derivative liabilities of $2,141,069 for the three months ended March 31,

Reorganization

items, net consists primarily of costs associated the post-petition Chapter 11 bankruptcy.

For the three months ended March 31, 2021,

we did not record reorganization items, net as compared to reorganization costs, net of $2,580,110 for the three months ended March

and Capital Resources

measure our liquidity in a number of ways, including the following:

Capital Surplus

Payable (Gross)

of Additional Funds

upon our accumulated deficit and stockholders’

deficit of $105,496,163 and $2,694,382, respectively, as of March 31, 2021, along

with our forecast for continued operating losses and our need for financing to fund our contemplated clinical trials, as of such date,

we required additional equity and/or debt financing to continue our operations.

of March 31, 2021, our outstanding debt of $9,426,039, together with interest at rates ranging between 5% and 7% per annum, was

due on November 16, 2023, except for the PPP loan.

As of March 31, 2021, the outstanding debt amount of $9,426,039 did

not include $657,598 of estimated DIP and Plan costs associated with the DIP Funding and the Plan (the “Auctus Costs”).

As of March 31, 2021, the Auctus Costs were not finalized.

Of the Auctus Costs, $500,000 and $157,598 are recorded in debt discount

and accrued expenses, respectively, on the unaudited condensed consolidated balance sheets.

operating needs include the planned costs to operate our business, including amounts required to fund working capital and capital expenditures.

Our future capital requirements and the adequacy of our available funds will depend on many factors, including our ability to successfully

commercialize our products and services, competing technological and market developments, and the need to enter into collaborations with

other companies or acquire other companies or technologies to enhance or complement our product and service offerings.

may be unable to raise sufficient additional capital when we need it or raise capital on favorable terms.

We have granted a security

interest in all of our assets to certain lenders, including Auctus, in connection with our Chapter 11 plan of reorganization.

impede our ability to raise additional debt financing.

In addition, future financing may require us to pledge certain assets and enter

into covenants that could restrict certain business activities or our ability to incur further indebtedness and may contain other terms

that are not favorable to our stockholders or us.

If we are unable to obtain adequate funds on reasonable terms, we may be required to

significantly curtail or discontinue operations or obtain funds by entering into financing agreements on unattractive terms.

unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report have been prepared in conformity with

accounting principles generally accepted in the United States of America (“U.S.

GAAP”), which contemplate our continuation

as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business.

The carrying amounts

of assets and liabilities presented in the financial statements do not necessarily purport to represent realizable or settlement values.

The financial statements do not include any adjustment that might result from the outcome of this uncertainty.

following events have mitigated the above factors with regards to our ability to continue as a going concern:

(i) as part of our Chapter

11 reorganization approximately $14,700,000 in outstanding debt and other liabilities were exchanged for (a) shares of common stock,

(b) new convertible notes with three year terms or (c) new convertible notes with three year terms and warrants to purchase shares of

common stock;

(ii) we secured DIP financing during our Chapter 11 reorganization in the aggregate amount of $1,189,413, and $3,848,548

in debt financing as part of our Chapter 11 reorganization to sustain operations;

and (iii) pursuant to the plan of reorganization, Auctus

is required to loan to us, as needed, an additional amount equal to $3,500,000, less the amount of Auctus’

DIP financing ($1,226,901,

inclusive of accrued interest) and its DIP costs.

As a result of the above, we have sufficient cash to fund operations for the twelve

months subsequent to the filing date.

In addition, the Company will need to obtain further funding of at least $12,000,000 to complete

a Phase 2 clinical study of the use of BRTX-100 .

the three months ended March 31, 2021 and 2020, our sources and uses of cash were as follows:

Months Ended March 31,

cash used in operating activities

cash provided by financing activities

(decrease) in cash

cash used in operating activities was $813,702 for the three months ended March 31, 2021, primarily due to the net loss of $15,653,330

which was partially offset by non-cash expenses of $14,519,965 related to amortization of debt discount and stock-based compensation

and $319,663 of cash provided by changes in the levels of operating assets and liabilities, primarily as a result of increases in accounts

payable and accrued interest, expenses and other current liabilities, partially offset by a decrease in prepaid assets and other current

Net cash used in operating activities was $448,646 for the three months ended March 31, 2020, primarily due to the net loss of

$7,550,772, which was partially offset by non-cash expenses of $6,950,957 related to amortization of debt discount, accretion of interest

expense, stock-based compensation, change in fair value of derivative liabilities, and loss on extinguishment of notes payable and $151,169

of cash provided by changes in the levels of operating assets and liabilities, primarily as a result of increases in accounts payable

and decreases in prepaid expenses and other current assets.

cash provided by financing activities for the three months ended March 31, 2021 was $250,000, which was due to $250,000 of net proceeds

from a loan received under the U.S.

Small Business Administration’s Paycheck Protection Program.

Net cash provided by financing

activities for the three months ended March 31, 2020 was $451,762, which was primarily due to $441,762 of net proceeds were debt financings

and $10,000 of proceeds from equity financings.

anticipate that the costs to complete our Phase 2 clinical trials with regard to our Disc/Spine Program will be at least $12,000,000.

In addition, we anticipate approximately $45,000,000 in additional funding will be needed to complete the clinical trials using BRTX-100

(assuming the receipt of no revenues).

As noted above in “Availability of Additional Funds”

we secured additional funding

as part of Chapter 11 reorganization in the aggregate amount of $5,037,961 as well as approximately $14,700,000 in outstanding debt and

other liabilities being exchanged for (a) shares of common stock, (b) new convertible notes with three year terms or (c) new convertible

notes with three year terms and warrants to purchase shares of common stock.

Additionally, pursuant to the plan of reorganization, Auctus

is required to loan to us, as needed, an additional amount equal to $3,500,000, less the amount of Auctus’

DIP financing ($1,226,901,

inclusive of accrued interest) and its DIP costs.

As a result of the above, we have sufficient cash to fund operations for the twelve

months subsequent to the filing date.

do not believe that inflation has had a material impact on our business, revenues or operating results during the periods presented.

Accounting Policies and Estimates

significant accounting policies are more fully described in the notes to our unaudited condensed consolidated financial statements included

herein for the quarter ended March 31, 2021 and in the notes to our consolidated financial statements included in our Annual Report on

Form 10-K for the year ended December 31, 2020, as filed with the SEC on April 30, 2021.

Value Measurement

fair value measurement guidance clarifies that fair value is an exit price, representing the amount that would be received to sell an

asset or paid to transfer a liability in an orderly transaction between market participants.

As such, fair value is a market-based measurement

that should be determined based on assumptions that market participants would use in the valuation of an asset or liability.

It establishes

a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value.

The hierarchy gives the highest

priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority

to unobservable inputs (Level 3 measurements).

The three levels of the fair value hierarchy under the fair value measurement guidance

are described below:

1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;

2 - Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the

full term of the asset or liability;

3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported

by little or no market activity).

preparation of unaudited condensed consolidated financial statements in conformity with U.S.

GAAP requires management to make estimates

and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at dates of the unaudited

condensed consolidated financial statements and the reported amounts of revenue and expenses during the periods.

Our significant estimates

and assumptions include the recoverability and useful lives of long-lived assets, the fair value of our common stock, stock-based compensation,

warrants issued in connection with notes payable, derivative liabilities and the valuation allowance related to our deferred tax assets.

Certain of our estimates, including the carrying amount of the intangible assets, could be affected by external conditions, including

those unique to us and general economic conditions.

It is reasonably possible that these external factors could have an effect on our

estimates and could cause actual results to differ from those estimates.

assets are comprised of trademarks and licenses with original estimated useful lives of 10 and 17.7 years, respectively.

into service, we amortize the cost of the intangible assets over their estimated useful lives on a straight-line basis.

of Long-lived Assets

review for the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset

may not be recoverable.

An impairment loss would be recognized when estimated future cash flows expected to result from the use of the

asset and its eventual disposition are less than its carrying amount.

While our near term liquidity is tight, historically we have been

successful in raising capital as needed (although there can be no assurance that we will continue to be successful in raising capital

We continue to progress our scientific agenda and meet related milestones.

We have not identified any impairment losses.

recognize deferred tax assets and liabilities for the expected future tax consequences of items that have been included or excluded in

our unaudited condensed consolidated financial statements or tax returns.

Deferred tax assets and liabilities are determined on the basis

of the difference between the tax basis of assets and liabilities and their respective financial reporting amounts, or temporary differences,

at enacted tax rates in effect for the years in which the temporary differences are expected to reverse.

adopted the provisions of Accounting Standards Codification Topic 740-10, which prescribes a recognition threshold and measurement process

for unaudited condensed consolidated financial statements recognition and measurement of a tax position taken or expected to be taken

in a tax return.

measure the cost of services received in exchange for an award of equity instruments based on the fair value of the award.

For employees

and directors, the fair value of the award is measured on the grant date and for non-employees, the fair value of the award is generally

re-measured on vesting dates and interim financial reporting dates until the service period is complete.

The fair value amount is then

recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period.

the shares underlying our 2010 Equity Participation Plan and the 2021 Stock Incentive Plan (the “Plans”) were registered,

we estimate the fair value of the awards granted under the Plans based on the market value of our freely tradable common stock as reported

The fair value of our restricted equity instruments was estimated by management based on observations of the cash sales prices

of both restricted shares and freely tradable shares.

Awards granted to directors are treated on the same basis as awards granted to

and Recently Adopted Accounting Pronouncements

new and recently adopted accounting pronouncements are more fully described in Note 2 to our unaudited condensed consolidated financial

statements herein for the quarter ended March 31, 2021.

Sheet Arrangements

have no 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

is material to stockholders.

Quantitative and Qualitative Disclosures about Market Risk

As a smaller reporting company, we are not required to provide the information required by this Item.

OF NET LEASE COST AND OTHER SUPPLEMENTAL LEASE INFORMATION

Six Months Ended June 30, 2021

Six Months Ended June 30, 2020

Operating lease cost (cost resulting from lease payments)

Net lease cost

Operating lease – operating cash flows (fixed payments)

Operating lease – operating cash flows (liability reduction)

Non-current leases – right of use assets

Current liabilities – operating lease liabilities

Non-current liabilities – operating lease liabilities

minimum payments under non-cancelable leases for operating leases for the remaining terms of the leases following the six months ended

June 30, 2021:

OF FUTURE MINIMUM PAYMENTS UNDER NON-CANCELABLE LEASE FOR OPERATING LEASES

Operating Leases

2021 (excluding the six months ended June 30, 2021)

Total future minimum lease payments

Amount representing interest

Present value of net future minimum lease payments

9 – SUBSEQUENT EVENTS

to June 30, 2021, pursuant to the Plan, for 110 %

of the DIP Costs, the Company agreed to issue to Auctus secured convertible promissory notes in the aggregate principal amount

of $ 183,043 , with a maturity date of November 16, 2023 .

The notes bear interest at 7 % per annum which is payable on maturity.

due under the notes may be converted into shares of the Company’s common stock, at $ 0.0001 par value, at a conversion price

equal to the average five daily volume weighted average price on the latest day prior to the conversion date.

In connection with the

notes, the Company has agreed to grant to Auctus Class A Warrants to purchase up to 332,805,400 shares of the Company’s

common stock at an exercise price of $ 0.0005 per share.

The Class A Warrants expire on November 16, 2025 .

In addition, in connection

with the notes, the Company has agreed to grant to Auctus Class B Warrants to purchase up to 166,402,700 shares of the

Company’s common stock at an exercise price of $ 0.001 per share.

The Class B Warrants expire on November 16, 2025 .

to June 30, 2021, pursuant to the Plan, for 110 %

of the Plan Costs, the Company agreed to issue Auctus a secured convertible promissory note in the principal amount of $ 532,499 ,

with a maturity date of November 16, 2023 .

The note bears interest at 7 % per annum which is payable on maturity.

Amounts due under

the note may be converted into shares of the Company’s common stock, at $ 0.0001 par value, at a conversion price equal to the average

five daily volume weighted average price on the latest day prior to the conversion date.

Company entered into a Settlement Agreement with a prior note holder, in connection with the conversion of a note prior to the

Petition Date (See Note 7).

Pursuant to the Settlement Agreement, subsequent to June 30, 2021, the Company issued 3,000,000 shares

of the Company’s common stock to the note holder with a fair value of $ 0.007 per share.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements