What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-05-16 compared with 2021-11-15 · 270 added, 800 removed, 349 unchanged (75% of the section changed)

5 unchanged sentences

Current Assets:

AND STOCKHOLDERS’ DEFICIT

expenses and other current liabilities

liability, current portion

loan payable, current portion

Accounts receivable

Prepaid expenses and other current assets

Total Current Assets

Property and equipment, net

Right of use asset

Intangible assets, net

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:

liability, net of current portion

payable, net of debt discount of $ 4,399,034

and $ 5,366,869 ,

loan payable, net of current portion

and Contingencies

Stockholders’

stock, $ 0.01 par

Authorized, 20,000,000

A Convertible Preferred stock, $ 0.01

Authorized, 1,543,158

issued and outstanding at September

30, 2021 and December 31, 2020

stock, $ 0.0001 par

Authorized, 300,000,000 ,000

issued and outstanding at September 30, 2021

and December 31, 2020, respectively

paid in capital

( 113,742,990 )

( 89,842,833 )

Stockholders’ Deficit

Accounts payable

Accrued expenses and other current liabilities

Lease liability, current portion

PPP loan payable, current portion

Total Current Liabilities

Lease liability, net of current portion

PPP loan payable, net of current portion

Total Liabilities

Commitments and Contingencies

Stockholders’ Equity

stock, $ 0.01 par value;

Authorized, 20,000,000 shares;

Series A Convertible Preferred stock, $ 0.01

1,543,158 Authorized, issued and outstanding

Common stock, $ 0.0001 par value;

Authorized, 75,000,000 shares;

3,631,719 and 3,520,391 issued and outstanding at March 31, 2022 and December 31, 2021, respectively

Additional paid in capital

Accumulated deficit

( 138,962,278 )

( 134,146,128 )

Liabilities and Stockholders’ Deficit

Total Stockholders’ Equity

Total Liabilities and Stockholders’ Equity

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

3 unchanged sentences

Consolidated STATEMENTS OF OPERATIONS

March 31, 2022

March 31, 2021

For the Three Months Ended

For the Nine Months Ended

September 30, 2021

September 30, 2020

September 30, 2021

September 30, 2020

March 31, 2022

March 31, 2021

Operating expenses:

6 unchanged sentences

( 15,054,656 )

( 1,897,611 )

Other (income) expense:

Interest expense

( 1,601,551 )

( 1,412,462 )

Loss on extinguishment of notes payable, net

Change in fair value of derivative liabilities

( 2,141,069 )

Reorganization items, net

Gain on PPP loan forgiveness

Amortization of debt discount

Total other (income) expense

1 unchanged sentence

$ ( 15,653,330 )

$ ( 4,184,232 )

$ ( 836,263 )

$ ( 23,900,157 )

$ ( 5,511,375 )

Net Loss Per Share

- Basic and Diluted

Weighted Average Number of Common Shares Outstanding

- Basic and Diluted

Net Loss Per Share - Basic and Diluted

Weighted Average Number of Common Shares Outstanding - Basic and Diluted

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

2 unchanged sentences

AND SUBSIDIARY

Consolidated STATEMENTS of CHANGES IN STOCKHOLDERS’ DEFICIT

Shareholders’

Consolidated STATEMENTS of CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

Series A Convertible

Preferred Stock

Stockholders’

Balance at January 1, 2022

1 unchanged sentence

$ ( 134,146,128 )

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

Shares issued in litigation settlement

Shares issued in litigation settlement, shares

Fair market value of beneficial conversion feature and warrants issued with convertible notes payable instruments

Stock-based compensation:

- restricted share units

- common stock

( 4,816,150 )

3 unchanged sentences

$ ( 138,962,278 )

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 )

Balance at June 30, 2021

( 109,558,758 )

( 3,808,941 )

Shares issued in cashless exercise of warrants

Shares issued in litigation settlement

Fair market value of beneficial conversion feature and warrants issued with convertible notes payable instruments

Stock-based compensation:

- restricted share units

( 4,184,232 )

Balance at September 30, 2021

$ 108,863,599

$ ( 113,742,990 )

$ ( 4,879,304 )

Balance at January 1, 2021

1 unchanged sentence

$ ( 1,331,492 )

Shares and warrants issued for cash

Shares issued in exchange for notes payable and accrued interest

Shares issued in cashless exercise of warrants

Stock-based compensation:

- restricted share units

( 15,653,330 )

3 unchanged sentences

$ ( 105,496,163 )

Stock-based compensation:

Balance at June 30, 2020

$ ( 2,694,382 )

( 14,441,181 )

( 83,245,258 )

( 14,441,181 )

Stock-based compensation:

Net income (loss)

Balance at September 30, 2020

$ ( 84,081,521 )

$ ( 15,092,678 )

$ ( 84,081,521 )

$ ( 15,092,678 )

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

3 unchanged sentences

Consolidated STATEMENTS OF CASH FLOWS

Nine Months Ended

September 30, 2021

September 30, 2020

March 31, 2022

March 31, 2021

Three Months Ended

March 31, 2022

March 31, 2021

Cash flows from operating activities:

3 unchanged sentences

Amortization of debt discount

Accretion of interest expense

Depreciation and amortization

Stock-based compensation

Shares issued in settlement of litigation

Loss on extinguishment of note payables, net

Write-off of derivative liabilities

( 4,375,231 )

Change in fair value of derivative liabilities

Non-cash effect of right of use asset

Stock-based compensation - options

Stock-based compensation - common stock

Stock-based compensation - RSUs

Gain on PPP loan forgiveness

Non-cash lease expense

Changes in operating assets and liabilities:

2 unchanged sentences

Accounts payable

Accrued interest, expenses and other current liabilities

Accrued expenses and other current liabilities

Lease liability

1 unchanged sentence

( 1,594,634 )

( 1,392,145 )

Cash flows from investing activities:

Purchases of equipment

Net cash used in investing activities

Cash flows from financing activities:

Proceeds from notes payable

Proceeds from PPP Loan

Proceeds from DIP Financing

Sales of common stock and warrants for cash

Net cash provided by financing activities

Net (decrease) increase in cash and cash equivalents

Net decrease in cash and cash equivalents

( 1,704,207 )

1 unchanged sentence

Cash - end of period

Supplemental cash flow information:

Cash paid for:

Non-cash investing and financing activities:

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

Accrued DIP expenses exchanged for convertible notes

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

8 unchanged sentences

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

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 – Notes

Payable – Chapter 11 Reorganization.

On October 27, 2021, the Company

effected a 1-for-4,000 reverse stock split .

The Company has retroactively applied the reverse stock split made effective on October 27,

2021 to share and per share amounts on the unaudited condensed consolidated financial statements for the three and nine months ended

September 30, 2021 and the year ended December 31, 2020.

The Company’s authorized shares of common stock and preferred stock were

not affected as a result of the reverse stock split.

October 27, 2021, the Company effected a 1-for-4,000 reverse stock split of its common stock.

The Company has retroactively applied the

reverse stock split made effective on October 27, 2021 to share and per share amounts on the unaudited condensed consolidated financial

statements for the three months ended March 31, 2021.

In connection with the reverse stock split, the Company’s authorized number

of shares of common stock was reduced from 300,000,000,000 to 75,000,000 .

The Company’s authorized number of shares of preferred

stock was not affected by the reverse stock split.

November 9, 2021, the Company completed a $ 23,000,000 underwritten public offering of units of securities pursuant to which an aggregate

of 2,300,000 shares of the Company’s common stock and warrants for the purchase of an aggregate of 2,645,000 shares of the Company’s

common stock were issued.

The Company intends to use the net proceeds from the offering as follows:

(i) undertaking of clinical trials

with respect to BRTX-100 and its related collection and delivery procedure;

(ii) pre-clinical research and development with respect to

the Company’s ThermoStem Program;

and (iii) for general corporate and working capital purposes.

In connection with the public offering,

the Company’s common stock was listed on the Nasdaq Capital Market.

of the Business

13 unchanged sentences

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

At September 30,

2021, the Company had an accumulated deficit of approximately $ 113,743,000 and working capital surplus of approximately $ 296,000 .

For the nine months ended September 30, 2021, the Company had a loss from operations of approximately $ 22,299,000 (of which, approximately

$ 19,930,000 was attributable to non-cash stock-based compensation) and negative cash flows from operations of approximately $ 2,185,000 .

At March 31, 2022,

the Company had an accumulated deficit of $ 138,962,278

and working capital surplus of $ 19,384,971 .

For the three months ended March 31, 2022, the Company

had a loss from operations of $ 5,053,793

(of which, $ 3,375,903

was attributable to non-cash stock-based compensation)

and negative cash flows from operations of $ 1,594,634 .

The Company’s operating activities consume the majority of its cash resources.

2 unchanged sentences

In addition, the Company has had and expects to have negative cash flows from operations, at least into the near future.

has previously funded, and plans to continue funding, these losses primarily through current cash on hand received subsequent to quarter

end and additional infusions of cash from equity and debt financing.

On November 9, 2021, the Company received net proceeds of approximately

$ 20,772,000 from its public offering (see Note 9 – Subsequent Events).

a result of the above, and cash on hand of approximately $ 22,191,150 as of November 10, 2021, the Company believes it has

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

funds noted above may not be sufficient to enable the Company to fully complete its development activities or attain profitable

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.

has previously funded, and plans to continue funding, these losses primarily through current cash on hand and additional infusions of

cash from equity and debt financing.

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

on November 9, 2021, the Company received net proceeds of approximately $ 21,073,000 from its public offering.

As a result of the above,

and cash on hand of $ 19,322,520 as of March 31, 2022, the Company believes it has sufficient cash to fund operations for the twelve months

subsequent to the filing date.

funds 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

7 unchanged sentences

of Presentation

accompanying unaudited condensed consolidated financial information as of and for the three and nine months ended September 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 nine months ended September 30,

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 months ended March 31, 2022 and 2021 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, 2022 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

2 unchanged sentences

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 consolidated financial statements for the

year ended December 31, 2021, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 30, 2022.

of Consolidation

1 unchanged sentence

Intercompany accounts and transactions have been eliminated upon consolidation.

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 sufficient to meet

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

operating expenses.

The Company believed that even after taking these actions, it would not have sufficient liquidity to satisfy its

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.

Code in the United 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”) 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 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 and nine months ended September

30, 2021 and 2020.

Reorganization items, net for the three and nine months ended September 30, 2021 were $ - and for the three and nine

months ended September 30, 2020 were ($ 183,387 ) and $ 597,919 , respectively, representing cash used in operating activities.

Reorganization

items, net for the three and nine months ended September 30, 2020 consisted of the following:

OF REORGANIZATION ITEMS, NET

Three Months Ended September 30, 2020

Nine Months Ended September 30, 2020

Professional fees

$ ( 183,387 )

$ ( 333,077 )

Write-off of derivative liability

Default interest and penalties

Unamortized debt discount on convertible notes

( 2,580,110 )

Total reorganization items, net

$ ( 183,387 )

preparation of the unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates

8 unchanged sentences

Significant estimates include the carrying value of intangible

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

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

assets, deferred tax asset and valuation allowance, and assumptions used in the Black-Scholes option pricing model, such as expected

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

7 unchanged sentences

royalties on a per disc procedure basis.

part of ASC 606, Revenue from Contracts with Customers (“ASC 606”), the Company has adopted several practical expedients

● Significant

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.

● Unsatisfied

Performance Obligations – for performance obligations related to contracts with a duration

of less than one year, the Company has elected to apply the optional exemption provided in

ASC 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 period.

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 the entity has a right

Company’s contracted transaction price is allocated to each distinct performance obligation and recognized as revenue when, or

as, the performance obligation is satisfied.

The Company’s contracts have a single performance obligation which is not separately

identifiable from other promises in the contracts and is, therefore, not distinct.

The Company’s performance obligation is satisfied

upon the transfer of risk of loss to the customer.

All sales have fixed pricing and there are currently no variable components included

in the Company’s revenue.

The timing of the Company’s revenue recognition may differ from the timing of receiving royalty

A receivable is recorded when revenue is recognized prior to receipt of a royalty payment and the Company has an unconditional

right to the royalty payment.

Alternatively, when a royalty payment precedes the provision of the related services, the Company records

deferred revenue until the performance obligations are satisfied.

During the three months ended March 31, 2022 and 2021, the Company

recognized $ 16,000 and $ 18,000 , respectively, of revenue related to the Company’s sublicenses.

Modifications

were no contract modifications during the three and nine months ended September 30, 2021.

Contract modifications are not routine in the

performance of the Company’s contracts.

were no contract modifications during the three months ended March 31, 2022.

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 September 30, 2021 or December 31, 2020.

There were no cash equivalents as of March 31, 2022 or December 31, 2021.

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

7 unchanged sentences

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

The Company did no t record an allowance

for doubtful accounts as of September 30, 2021 and December 31, 2020, respectively.

The Company did not record an allowance

for doubtful accounts as of March 31, 2022 or December 31, 2021.

and Equipment

20 unchanged sentences

Fair value is determined based on discounted cash flows or appraised values, depending on the nature of the

During the three and nine months ended September 30, 2021 and 2020, the Company determined that there was no impairment charge

for intangible assets.

During the three months ended March 31, 2022

and 2021, 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 .

5 unchanged sentences

Advertising and marketing expenses were $ 469 and $ 2,600 for the

three months ended September 30, 2021 and 2020, respectively.

Advertising and marketing expenses were $ 9,120 and $ 28,281 for the nine

months ended September 30, 2021 and 2020, respectively.

Advertising and marketing expenses are recorded in marketing and promotion on

the unaudited condensed consolidated statements of operations.

three months ended March 31, 2022 and 2021, respectively.

Advertising and marketing expenses are recorded in marketing and promotion

on the unaudited condensed consolidated statements of operations.

Value Measurements

26 unchanged sentences

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

Value of Financial Instruments

carrying value of cash, accounts receivable, accounts payable and accrued expenses, and other current liabilities approximate their fair

values based on the short-term maturity of these instruments.

Loss per Common Share

6 unchanged sentences

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 and nine months ended September 30, 2021

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

been excluded from the Company’s computation of net loss per common share for the three months ended March 31, 2022 and 2021.

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

these potential shares was antidilutive:

SCHEDULE OF WEIGHTED AVERAGE DILUTIVE COMMON SHARES

Three Months Ended

September 30,

Unvested RSUs

Convertible notes – common stock

Nine Months Ended

September 30,

Unvested RSUs

Convertible notes – common stock

of September 30, 2021, all of the convertible notes had variable conversion prices and the

shares issuable were estimated based on the market conditions.

of March 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 12,876,004 shares of common stock reserved for future note conversions as of September

30, 2021 (see Note 9 – Subsequent Events).

there were 1,519,645 shares of common stock reserved for future note conversions as of March

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

of operations.

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

consolidated statements of operations.

stock options issued to employees and members of the board of directors for their services, the Company estimates the grant date fair

6 unchanged sentences

the grant date fair value of stock options on a straight-line basis over the requisite service period, which is generally the vesting

Forfeitures are recorded as they are incurred.

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):

1 unchanged sentence

Share-Based Payment Accounting, the Company accounts for stock options issued to non-employees for their services in accordance with

The Company uses valuation methods and assumptions to value the stock options that are in line with the process for valuing

The Company uses valuation methods and assumptions to value the stock options that are consistent with the process for valuing

employee 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

common stock as reported on the Nasdaq Capital Market.

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

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.

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

Upon the exercise of an option or warrant, the Company issues new shares of common stock out of its authorized shares.

received under research grants for reimbursement of research and development expenses is recorded as grant income in the other (income)

expense section of the condensed consolidated statements of operations.

tax assets and liabilities are recognized for the future tax consequences attributable to differences between the unaudited condensed

11 unchanged sentences

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

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

net deferred tax asset has been fully reserved.

At March 31, 2022 and December 31, 2021, 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

1 unchanged sentence

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

a determination is made that such expense is likely.

Financial Instruments

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”)

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

subsequent balance sheet date.

Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period

at each balance sheet date.

Conversion options are recorded as a discount to the host instrument and are amortized as amortization of

debt discount on the unaudited condensed consolidated financial statements over the life of the underlying instrument.

The Company reassesses

the classification of its derivative instruments at each balance sheet date.

If the classification changes as a result of events during

the period, the contract is reclassified as of the date of the event that caused the reclassification.

Multinomial Lattice Model and Black-Scholes option pricing model were used to estimate the fair value of the ECOs of convertible notes

payable, warrants, and stock options that are classified as derivative liabilities on the unaudited condensed consolidated balance sheets.

These models include subjective input assumptions that can materially affect the fair value estimates.

The expected volatility is estimated

based on the actual 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

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 greater than 12 months to be recognized on the balance sheet with a liability for the lease payments and a corresponding right-of-use

(“ROU”) asset initially measured at the present value of amounts expected to be paid over the term.

Recognition of the costs

of these leases on the income statement will be dependent upon their classification as either an operating or financing lease.

of an operating lease will continue to be recognized as a single operating expense on a straight-line basis over the lease term.

for a financing lease will be disaggregated and recognized as both an operating expense (for the amortization of the ROU asset) and interest

expense (for interest on the lease liability).

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

lease is defined as a contract that conveys the right to control the use of identified property, plant or equipment for a period of time

in exchange for consideration.

accordance with ASC 842, Leases (“ASC 842”), the Company recognized an ROU asset and corresponding lease liability

on its balance sheets for 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.

assets include any prepaid lease payments and exclude any lease incentives and initial direct costs incurred.

Lease expense for minimum

lease payments is recognized on a straight-line basis over the lease term.

The lease terms used in measuring ROU assets and lease liabilities

may include or exclude periods covered by options to extend or terminate a lease, respectively, if it is reasonably certain that the

Company will exercise the option(s).

in which the Company is the lessee are comprised of rented office space.

All of the leases are classified as operating leases.

has a lease agreement for office space with a remaining term of 3.25 years as of September 30, 2021.

Issued Accounting Standards

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) (“ASU 2021-04”), 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 a modification

An entity should measure the effect of a modification or exchange of a freestanding equity-classified written call option

that remains equity-classified after a modification or exchange as follows:

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

related to a modification or exchange of an existing debt instrument or line-of-credit or revolving-debt arrangements (hereinafter, referred

to as “debt” or a “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;

ii) for all other modifications

or exchanges, as the excess, if any, of the fair value of the modified or exchanged written call option over the fair value of that written

call option immediately before it is modified or exchanged.

The amendments in ASU 2021-04 are effective for all entities for fiscal years

beginning after December 15, 2021, including interim periods within those fiscal years.

An entity should apply the amendments prospectively

to modifications or exchanges occurring on or after the effective date of the amendments.

The Company is currently evaluating the impact

of this standard on its unaudited condensed consolidated financial statements.

other newly issued but not yet effective accounting pronouncements have been deemed to be immaterial or not applicable to the Company.

On January 1, 2019, the Company adopted ASC 842, Leases (“ASC 842”), and it primarily

affected the accounting treatment for operating lease agreements in which the Company is the lessee.

accordance with ASC 842, the Company recognized a right-of-use (“ROU”) asset and corresponding lease liability on its balance

sheets for its office space lease agreement.

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

financial statements and related disclosures.

assets include any initial direct costs and prepaid lease payments and exclude any lease incentives.

Lease expense for minimum lease

payments is recognized on a straight-line basis over the lease term.

The lease terms may include options to extend or terminate the lease

if it is reasonably certain that the Company will exercise that option.

in which the Company is the lessee are comprised of office rental.

The Company has a lease agreement for office space with a remaining

term of 2.75 years as of March 31, 2022.

3 – INTANGIBLE ASSETS

1 unchanged sentence

Pursuant to the SCTC Agreement,

the Company obtained, among other things, a worldwide, exclusive, royalty-bearing license from the SCTC to utilize or sublicense a certain

medical device patent for the administration of specific cells and/or cell products to the disc and/or spine (and other parts of the

body) and a worldwide (excluding Asia and Argentina), exclusive, royalty-bearing license to utilize or sublicense a certain method for

culturing cells.

Pursuant to the license agreement with the SCTC, unless certain performance milestones had been or are satisfied, the

Company would have been required to pay to the SCTC $ 150,000 by April 2017 and an additional $ 250,000 by April 2019 in order to maintain

its exclusive rights with regard to the disc/spine technology.

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

satisfied a performance milestone such that the Company was not required to pay to the SCTC a minimum amount of $ 150,000 by April 2017

to retain exclusive rights with regard to the disc/spine technology.

In addition, the Company believes that it has until February 2022

to complete the Phase 2 clinical trial in order to satisfy the final performance milestone such that the Company was not required to

pay the additional $ 250,000 by April 2019 pursuant to the SCTC Agreement to maintain its exclusive rights.

the Company obtained, among other things, a worldwide (excluding Asia and Argentina), exclusive, royalty-bearing license from the SCTC

to utilize or sublicense a certain method for culturing cells and a worldwide, exclusive, royalty-bearing license from the SCTC to utilize

or sublicense a certain medical device patent for the administration of specific cells and/or cell products to the disc and/or spine

(and other parts of the body).

Pursuant to the license agreement with the SCTC, certain performance milestones (or payouts in lieu of

performance milestones) had to be satisfied in order for the Company to maintain its exclusive rights with regard to the disc/spine technology

(subject to the SCTC’s compliance with its obligations under the SCTC Agreement).

The Company did not timely satisfy the third

of these performance milestones (which needed to be satisfied by February 2022).

Accordingly, such rights may currently be non-exclusive.

The Company and the SCTC are currently negotiating the terms of an agreement confirming the exclusive nature of the license.

can be given in this regard.

In February 2017, the Company received authorization from the Food and Drug Administration (the “FDA”)

to proceed with a Phase 2 clinical trial.

The Company has commenced such clinical trial.

In March 2022, a United States patent relating

to the Company’s BRTX-100 clinical program was issued.

assets consist of the following:

OF INTANGIBLE ASSETS BY MAJOR CLASS

OF FINITE LIVED INTANGIBLE ASSETS

Patents and Trademarks

5 unchanged sentences

Amortization expense

Balance as of September 30, 2021

Balance as of March 31, 2022

$ ( 734,067 )

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

of intangible assets consists of the following:

OF FINITE LIVED INTANGIBLE ASSETS AMORTIZATION EXPENSES

Weighted average remaining amortization period at March 31, 2022 (in years)

amortization of intangible assets consists of the following:

SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS AMORTIZATION EXPENSES

Patents and Trademarks

4 unchanged sentences

Amortization expense

Balance as of September 30, 2021

Balance as of March 31, 2022

4 – ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

expenses and other current liabilities consist of:

OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

September 30,

SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

March 31, 2022

Accrued payroll

1 unchanged sentence

Accrued general and administrative expenses

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

Total accrued expenses

represents DIP and Plan costs associated with the Auctus DIP Funding and the Plan.

5 – NOTES PAYABLE

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

OF NOTES PAYABLE ACTIVITY

Convertible Notes

Debt Discount

summary of the notes payable activity during the three months ended March 31, 2022 is presented below:

SCHEDULE OF NOTES PAYABLE ACTIVITY

Outstanding, January 1, 2022

$ ( 5,366,869 )

Exchanges for equity

Amortization of debt discount

Outstanding, September 30, 2021

$ ( 4,399,034 )

11 Reorganization

March 20, 2020, the Company filed a voluntary petition commencing a 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.

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,

without the consent of the Company, more than 33% of the issued shares during each of the three initial 30 day periods following the

Effective Date.

As a result of the Chapter 11 petition, the conversion rights for the then outstanding notes were rescinded and were

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

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

of the 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

recorded in debt discount and accrued expenses, respectively, on the consolidated balance

On September 27, 2021, these amounts were converted into secured convertible promissory

notes totaling an aggregate principal amount of $ 715,303 .

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

“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;

the payment of the Secured Convertible Notes is secured

by the grant of a security interest in substantially all of the Company’s assets;

Secured Convertible Notes have the following features:

date of three years following the Effective Date;

at the rate of 7 % per annum;

right of the holder to convert the indebtedness into shares of common stock of the Company

at a price equal to the volume weighted average price for the common stock over the five

trading days immediately preceding the conversion;

conversion of all indebtedness at such time as the common stock is listed on the Nasdaq Capital

Market or another senior exchange 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 $ 2.00 (a total of 1,750,000 Class

A Warrants in consideration of the Initial Auctus Funding and a total of approximately 174,250

Class A Warrants in the aggregate in consideration of the Other Funding), such Class A Warrants

having an exercise price of $ 2.00 per share;

(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 $ 4.00 (a total of 875,000 Class B Warrants in consideration of the Initial

Auctus Funding and a total of approximately 87,125 Class B Warrants in the aggregate in consideration

of the Other Funding), such Class B Warrants having an exercise price of $ 4.00 per

obligation to Auctus with respect to the DIP Funding has been exchanged for the following:

Secured Convertible Note in the principal amount of approximately $ 1,349,591 ( 110 % of the

DIP Funding) with a maturity date of November 16, 2023;

Class A Warrant to purchase 613,451 shares of common stock;

Class B Warrant to purchase 306,725 shares of common stock (as to which 181,571 shares of

common stock have been exercised on a net exercise basis, pursuant to the terms of the Class

B Warrant, with respect to the issuance of 167,781 shares of common stock, of which 54,449

and 113,332 were issued during 2020 and 2021, respectively).

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

Note in such amount.

claim arising from the promissory note issued in June 2016 by the Company to Desmarais in

the original principal amount of $ 175,000 was treated as an allowed general unsecured claim

in the amount of $ 245,192 and was satisfied and exchanged for 6,130 shares of common stock.

claim arising from the promissory note issued in June 2016 by the Company to Tuxis Trust,

an entity related to Desmarais, in the original principal amount of $ 500,000 was treated

was treated as an allowed general unsecured claim in such amount and exchanged for 11,113

shares of common stock;

was treated as an allowed secured claim in such amount and exchanged for a Secured Convertible

Note in such amount with a maturity date of November 16, 2023.

of allowed general unsecured claims (other than Auctus and the Other Lenders) received an

aggregate of 262,432 shares of common stock where were valued at the fair market value of

the stock at issuance date of $ 14,381,259 with an associated loss of $ 3,883,991 recognized

in Reorganization Items, net on the accompanying consolidated statement of operations in

exchange for approximately $ 10,497,268 outstanding accounts payable and convertible debt

(including accrued interest), with such shares being subject to a leak-out restriction prohibiting

each holder from selling, without consent of the Company, more than 33% of its shares during

each of the three initial 30 day periods following the Effective Date.

and the Other Lenders have been issued, in respect of their allowed general unsecured claims

($ 3,261,819 in the case of Auctus and 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:

date of three years from the Effective Date;

at the rate of 5 % per annum;

right of the holder to convert the indebtedness into shares of common stock at a price equal

to the volume weighted average for the common stock over the five trading days immediately

preceding the conversion;

conversion of all outstanding indebtedness at such time as the common stock listed on the

Nasdaq Capital Market or another senior exchange on the same terms as provided to investors

in connection with a public offering undertaken in connection with such listing;

leak-out restriction prohibiting each holder from selling, without the consent of the Company,

more than 16.6 % of the underlying shares received upon conversion during each of the six

initial 30-day periods following the Effective Date.

issuance of (a) the shares of common stock and the Unsecured Convertible Notes to the holders

of allowed general unsecured claims and (b) the Secured Convertible Notes and Plan Warrants

to Auctus in exchange for the DIP Funding and any common stock into which those Secured Convertible

Notes and those Plan Warrants may be converted is exempt from the registration requirements

of the Securities Act of 1933, as amended, pursuant to the Bankruptcy Code Section 1145.

Such securities shall be freely transferrable subject to Section 1145(b)(i) of the Bankruptcy

to the Plan, on the Effective Date, the Company filed a Certificate of Amendment to its Certificate of Incorporation pursuant to which,

among other things, the number of shares of common stock authorized to be issued by the Company has been increased to 300,000,000,000

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

Company recorded $ 152,499 and $ - of interest expense related to notes payable and convertible note payable for the three months ended

September 30, 2021 and 2020, respectively.

The Company recorded $ 438,913 and $ 368,810 of interest expense related to notes payable and

convertible note payable for the nine months ended September 30, 2021 and 2020, respectively (see Note 9 – Subsequent Events).

Exchanges and Other

the nine months ended September 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 8,069 shares of the Company’s common stock at a conversion price of

$ 40 per share.

Debtor-in-Possession

the year ended December 31, 2020, and subsequent to the Petition Date, in connection with the Chapter 11 Case, the Company received debtor-in-possession

loans of $ 1,189,413 in the aggregate from Auctus.

proceeds from the DIP Funding were used (a) for working capital and other general purposes of the Company;

(b) United States Trustee

and (d) interest,

fees, costs and expenses incurred in connection with the DIP Funding, including professional fees.

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

Note 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

In connection with the Secured Convertible

Notes, Auctus received warrants to purchase an aggregate of 920,176

shares of Company’s common stock with exercise

prices ranging between $ 2.00

September 27, 2021, pursuant to the Plan, for 110 % of the DIP Costs, the Company issued to Auctus secured two 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.

Amounts 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

In connection with the notes, the Company granted to Auctus Class A Warrants to purchase up to 83,201 shares of the Company’s

common stock at an exercise price of $ 2.00 per share.

The Class A Warrants expire on November 16, 2025 .

In addition, in connection

with the notes, the Company granted to Auctus Class B Warrants to purchase up to 41,601 shares of the Company’s common stock at

an exercise price of $ 4.00 per share.

The Class B Warrants expire on November 16, 2025 .

The warrants had an aggregate grant date

fair value of $ 152,300 which was recorded as a debt discount and is being amortized over the term of the note.

In addition, the note

contains a beneficial conversion feature with a relative fair value of $ 14,103 which was recorded as a debt discount and is being amortized

over the term of the note.

As of September 30, 2021, $ 183,043 was outstanding.

September 27, 2021, pursuant to the Plan, for 110 % of the Plan Costs, the Company issued to 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

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.

September 30, 2021, $ 532,499 was outstanding.

expense for the five Secured Convertible Notes was $ 24,214 and $ 71,062 for the three and nine months ended September 30, 2021,

respectively.

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

Offering Exchange

Subsequent to September

30, 2021, in connection with the public offering, see Note 9 – Subsequent Events, all of the above outstanding convertible

notes, associated accrued interest and warrants held by Auctus, as well as outstanding convertible notes in the aggregate principal

amount of $ 1,219,945 , associated accrued interest and warrants for the purchase of an aggregate of 236,411 shares of common stock,

were exchanged for an aggregate amount of 1,856,938

units of common stock and warrants (of the type issued pursuant to the Company’s public offering) (except that Auctus received

shares of Series A preferred stock in lieu of common stock with regard to a portion of the exchanged amount, as described in Note

9 – Subsequent Events), ultimately resulting in approximately 1,543,000

newly issued shares of Series A Convertible Preferred Stock, approximately 314,000

shares of common stock and approximately 1,857,000

warrants being issued (see Note 9 – Subsequent Events).

Outstanding, March 31, 2022

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.

Pursuant to the note, principal and interest payments are deferred for ten months.

At that time the Company may apply for

loan forgiveness.

If the Company does not apply for loan forgiveness, or if the loan forgiveness is denied, the Company will be

required to make monthly payments of $ 5,100 starting on January 14, 2022.

As of September 30, 2021, the Company has not

applied for loan forgiveness.

All remaining unpaid principal and interest is due and payable at the maturity date.

30, 2021, $ 250,000 was outstanding .

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

OF FUTURE MINIMUM PAYMENTS OF NOTES PAYABLE

Remainder of 2021

Total future minimum payments

( 4,399,034 )

Notes payable, non-current

6 – STOCKHOLDERS’ DEFICIT

Series A Preferred

to September 30, 2021, concurrent with the Company’s public offering, see Note 9 – Subsequent Events, the Company’s

Board of Directors adopted a resolution allowing for the authorization of and issuance of 1,543,458 shares of the Company’s Preferred

Stock, $ .01 par value per share, designated as Series A Preferred Stock (“Series A”).

A holders shall be entitled to receive, when and as declared by the Board of Directors, dividends on a pari passu basis with the

holders of the shares of the Company’s common stock based upon the number of shares of common stock into which the Series A is

then convertible.

A holders shall be entitled to vote on all matter presented to the stockholders of the Company and shall be entitled to such number of

votes that equal the number of shares of common stock that each share of Series A held may be converted into;

provided, however, that

in no event shall a Series A holder be entitled to vote more than 4.99 % of the then outstanding shares of common stock.

Small Business Administration’s Paycheck Protection Program (“PPP”), 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 .

Pursuant to the note, principal and interest payments were deferred for ten months.

At that time the Company was able to apply for loan

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

On January 5, 2022, the total amount of the PPP loan was forgiven .

6 – Stockholders’ EQUITY (DEFICIT)

November 8, 2021, in connection with the Company’s public offering, the Company’s Board of Directors adopted a resolution

allowing for the authorization of and issuance of 1,543,458 shares of the Company’s Preferred Stock, $ .01 par value per share,

designated as Series A Preferred Stock (“Series A”).

The Series A has a liquidation preference of $ 0.001 per share.

A holders shall be entitled to receive, when and as declared by the Board of Directors, dividends on a pari passu basis with the holders

of the shares of the Company’s common stock based upon the number of shares of common stock into which the Series A is then convertible.

A holders shall be entitled to vote on all matters presented to the stockholders of the Company and shall be entitled to such number

of votes that equal the number of shares of common stock into which each share of Series A held may be converted;

provided, however,

that in no event shall a Series A holder be entitled to vote more than 4.99 % of the then outstanding shares of common stock.

Conversion - Each share of Series A shall be convertible, at any time, at the option of the Series A holder, into one share of common

1 unchanged sentence

conversion would result in beneficial ownership by the Series A holder of more than 4.99 % of the outstanding shares of common stock.

Conversion – In the event that an event occurs which has the effect of reducing a Series A holder’s beneficial ownership

of shares of common stock to less than 4.5 % of the then publicly disclosed outstanding shares of common stock, then within five business

days thereafter, the Series A holder shall provide notice to the Company to such effect.

Such notice shall have the effect of a notice

of conversion such that the Series A holder’s post-conversion ownership of common stock will be 4.99% of the then publicly disclosed

outstanding shares of common stock.

Incentive Plan

Conversion – If an event occurs which has the effect of reducing a Series A holder’s beneficial ownership of shares of common

stock to less than 4.5 % of the then publicly disclosed outstanding shares of common stock, then, within five business days thereafter,

the Series A holder shall provide notice to the Company to such effect.

Such notice shall have the effect of a notice of conversion such

that the Series A holder’s post-conversion ownership of common stock will be 4.99 % of the then publicly disclosed outstanding shares

of common stock.

Stock Incentive Plan

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

2 unchanged sentences

of stock options, restricted stock units, restricted stock, stock appreciation rights and other incentive awards.

As of March 31, 2022,

based on stock option and restricted stock units currently outstanding under the 2021 Plan, no shares remain available for future grant

under the 2021 Plan.

and Option Valuation

13 unchanged sentences

Activity Summary

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

OF WARRANTS GRANTED ASSUMPTIONS

September 30, 2021

September 30, 2020

Risk free interest rate

Contractual term (years)

Expected volatility

weighted average estimated fair value of warrants granted during the nine months ended September 30, 2021 and 2020 was $ 14.40

and $ 40 per share, respectively.

the nine months ended September 30, 2021, the Company issued an aggregate of 147,832 shares of the Company’ common stock, as a

result of the cashless exercise of 170,495 warrants to Auctus.

summary of the warrant activity during the nine months ended September 30, 2021, is presented below:

OF WARRANT ACTIVITY

warrants were granted or issued during the three months ended March 31, 2022 and 2021.

summary of the warrant activity during the three months ended March 31, 2022, is presented below:

SCHEDULE OF WARRANT ACTIVITY

Outstanding, January 1, 2022

Outstanding, September 30, 2021

Exercisable, September 30, 2021

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

OF STOCK WARRANTS

Outstanding, March 31, 2022

Exercisable, March 31, 2022

following table presents information related to warrants at March 31, 2022:

SCHEDULE OF STOCK WARRANTS

Warrants Outstanding

1 unchanged sentence

Remaining Life

$ 0.00 - $ 60

$ 800 - $ 7,960

$ 4,000 - $ 7,960

$ 8,000 - $ 11,960

$ 12,000 - $ 15,960

$ 16,000 - $ 19,960

$ 20,000 - $ 23,960

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

OF STOCK OPTION GRANTED ASSUMPTIONS

For the Nine Months Ended

September 30,

SCHEDULE OF STOCK OPTION GRANTED ASSUMPTIONS

For the Three Months Ended

Risk free interest rate

2 unchanged sentences

Expected dividends

Company granted options for the purchase of 586,959 shares of common stock during the nine months ended September 30, 2021.

Company did no t issue stock options during the nine months ended September 30, 2020.

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

summary of the option activity during the nine months ended September 30, 2021 is presented below:

Company granted options for the purchase of 25,000 shares of common stock during the three months ended March 31, 2022.

Company granted options for the purchase of 586,959 shares of common stock during the three months ended March 31, 2021.

grant date fair value of options issued during the three months ended March 31, 2022 was $ 122,117 .

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

summary of the stock option activity during the three months ended March 31, 2022 is presented below:

OF STOCK OPTION ACTIVITY

Outstanding, January 1, 2022

Outstanding, September 30, 2021

Exercisable, September 30, 2021

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

Outstanding, March 31, 2022

Exercisable, March 31, 2022

following table presents information related to stock options at March 31, 2022:

OF STOCK OPTION BY EXERCISE PRICE

3 unchanged sentences

$ 48,200 - $ 52,000

$ 1,040 - $ 2,960

$ 3,000 - $ 3,960

$ 4,000 - $ 23,960

$ 24,000 - $ 79,960

$ 80,000 - $ 120,000

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 586,959 shares of the Company’s common stock

(see Note 7 – Commitments and Contingencies).

The options have an exercise price of $ 47.60 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 .

Subsequent to September 30, 2021, the Company reduced the exercise price of these options from $ 47.60 per share to $ 13.50 per share

and revised the vesting period (see Note 9 – Subsequent Events).

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

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 vested and nonforfeitable RSU.

March 18, 2021, the Company, pursuant to two employment agreements, granted an aggregate of 293,479 RSUs to its Chief Executive Officer

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

with a fair value of $ 47.60 per share.

The RSUs vest to the extent of one-third on the one-year anniversary of the grant date, one-third

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 September 30, 2021, is as follows:

to the 2021 Plan, the Company grants RSUs to employees, consultants and 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 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, 2022, the Company, granted an aggregate of 24,876 RSUs to its Chief Executive Officer, President and Chairman of the Board

and its Vice President, Research and Development (see Note 7 – Commitments and Contingencies) with a fair value of $ 4.21 per share.

The RSUs vest in twelve equal monthly installments.

summary of our unvested RSUs as of March 31, 2022 is as follows:

OF UNVESTED RESTRICTED STOCK UNITS

Outstanding, January 1, 2022

Outstanding, September 30, 2021

Outstanding, March 31, 2022

following table presents information related to stock compensation expense:

OF STOCK OPTION EXPENSE

For the Three

SCHEDULE OF STOCK OPTION EXPENSE

the Three Months Ended

Unrecognized at

September 30,

Research and development

1 unchanged sentence

7 - COMMITMENTS AND CONTINGENCIES

Claims and Assessments

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

were fulfilled.

Pursuant to a hearing held on February 13, 2020, the temporary restraining order with regard to the Company issuing shares

of common stock was not continued.

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;

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

25, 2020, to approve the foregoing.

On March 18, 2020, the Board considered the matter, and, based upon the Court order, determined to

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 commencing its Chapter 11 Case.

As of the date of this report, the Company has not effected the 1,000 to 1 reverse

however, on October 27, 2021, the Company effected a 1-for-4,000 reverse split of its common stock.

Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable settlements.

or Departure of Directors and Certain Officers

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.

to the Alstodt Employment Agreement, Mr.

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

Alstodt’s annual salary will increase by $ 50,000

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

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

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

Alstodt pursuant to the 2021 Plan of (i) a ten

year option for the purchase of 293,479

shares of common stock of the Company and (ii) 1 46,740

RSUs of the Company (see Note 6 – Stockholders’ Deficit) for additional information.

Subsequent to

September 30, 2021, the Company reduced the exercise price of these options from $ 47.60

per share to $ 13.50

per share and revised the vesting period (see Note 9 – Subsequent Events).

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

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

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

The Silva Employment

Agreement also provides for the grant to Mr.

Silva pursuant to the 2021 Plan of (i) a ten year option for the purchase of 293,479

shares of common stock of the Company and (ii) 146,740 RSUs of the Company (see Note 6 – Stockholders’ Deficit) for

additional information.

Subsequent to September 30, 2021, the Company reduced the exercise price of these options from $ 47.60

per share to $ 13.50 per share and revised the vesting period (see Note 9 – Subsequent Events).

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 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 abovementioned lenders whereby the Company agreed to issue

750 shares of the Company’s common stock in lieu of cash for an additional $ 30,000 of approved unsecured claims related to the

On July 16, 2021, the Company issued the 750 shares with a fair value of $ 28 per share.

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

lease liabilities.

and Development Agreement

December 20, 2021, the Company entered into a Master Clinical Services Agreement (the “Services Agreement”) with Professional

Research Consulting, Inc.

(“PRC”) pursuant to which PRC will provide trial management services related to the Company’s

Phase 2 clinical trials.

The Services Agreement has a 46 -month

term with an estimated budgeted cost of $ 5,844,380 .

Upon execution of the Services Agreement, the Company made an upfront payment of $ 328,152

which was recorded as a prepaid expense on the

condensed consolidated balance sheet at December 31, 2021, and is being expensed over the life of the Services Agreement as the services

are rendered.

During the three months ended March 31, 2022, the Company incurred $ 477,597 of research and development expense and

had a balance in prepaid expense of $ 395,525

at March 31, 2022 associated with the

Services Agreement.

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

9 unchanged sentences

OF NET LEASE COST AND OTHER SUPPLEMENTAL LEASE INFORMATION

Nine Months Ended September 30, 2021

Nine Months Ended September 30, 2020

Three Months Ended March 31, 2022

Three Months Ended March 31, 2021

Operating lease cost (cost resulting from lease payments)

5 unchanged sentences

Non-current liabilities – operating lease liabilities

minimum payments under non-cancelable leases for operating leases for the remaining terms of the leases as of September 30, 2021:

minimum payments under non-cancelable leases for operating leases for the remaining terms of the leases as of March 31, 2022:

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

Operating Leases

Remainder of 2021

2022 (excluding the three months ended March 31, 2022)

Total future minimum lease payments

1 unchanged sentence

Present value of net future minimum lease payments

9 – SUBSEQUENT EVENTS

of Certain Officers and Election of Directors

November 4, 2021, the Company appointed Robert E.

Kristal as its Chief Financial Officer.

Concurrently with his appointment, Mr.

was granted an option to purchase 10,490 shares of the Company’s common stock at an exercise price of $ 13.50 per share.

is exercisable for a ten year period and vests on a quarterly basis over a two year period commencing upon the date of grant.

November 4, 2021, Patrick F.

Williams was elected a director of the Company.

Williams was appointed to the Audit Committee (Chair),

Compensation Committee, and Nominating Committee of the Board of Directors of the Company.

Concurrently with his election, Mr.

was granted an option for the purchase of 10,490 shares of the Company’s common stock at an exercise price of $ 13.50 per share.

Such option is exercisable for a ten year period and vests on a quarterly basis over a two year period commencing upon the date of grant.

November 4, 2021, David Rosa was elected a director of the Company.

Rosa was appointed to the Nominating Committee (Chair), Compensation

Committee, and Audit Committee of the Board of Directors of the Company.

Concurrently with his election, Mr.

Rosa was granted an option

for the purchase of 10,490 shares of the Company’s common stock at an exercise price of $ 13.50 per share.

Such option is exercisable

for a ten year period and vests on a quarterly basis over a two year period commencing upon the date of grant.

November 4, 2021, the Company granted options to purchase an aggregate of 140,824

shares of its common stock, including the options to purchase 10,490

shares each granted to Mr.

Williams, and Mr.

Rosa, as noted above, to its officers and directors at an

exercise price of $ 13.50

Included within the 140,824

share option grants were grants to each of Mr.

Alstodt and Mr.

Silva for the purchase of 42,059

shares of common stock and to Dr.

Nickolay Kukekov, a director of the Company, for the purchase of 25,236

shares of common stock.

The option grants to Mr.

Silva, and Dr.

Kukekov have a ten

year term and an exercise price of $ 13.50

options are exercisable to the extent of 50% on the date of grant and 50% quarterly over a period of two years commencing one year

from the date of grant.

In addition, on November 4, 2021, the Company reduced the exercise price of options held by Mr.

Alstodt and Mr.

Silva, each for the purchase of 293,479

shares of the Company’s common stock, from $ 47.60

per share to $ 13.50

per share and revised the vesting period.

November 4, 2021, the Company granted options to purchase an aggregate of 110,767 shares of the Company’s common stock to members

of its Scientific Advisory Board and various employees and consultants at an exercise price of $ 13.50 per share.

October 2021, the Company entered into an Exchange Agreement (the “Auctus Agreement”) with Auctus to exchange outstanding

convertible promissory notes in the aggregate principal amount of $ 8,826,952 , $ 596,446 in accrued interest, and outstanding warrants

for the purchase of an aggregate of 3,441,586 shares of the Company’s common stock for units of common stock and warrants that

were issued by the Company in its underwritten public offering (the “Public Offering”), except that, to the extent the issuance

of common stock pursuant to the Auctus Agreement would result in Auctus being the beneficial owner of more than 4.99% of the Company’s

outstanding common stock, the Company will instead issue to Auctus shares of Series A preferred stock.

On November 9, 2021, in connection

with the Public Offering, the Company issued to Auctus 133,422 shares of the Company’s common stock, 1,543,158 shares of Series

A preferred stock, and warrants for the purchase of 1,676,580 shares of common stock.

addition, during October 2021, the Company entered into Exchange Agreements with four other holders of convertible promissory notes and

warrants (collectively, the “Other Holders”) with regard to the exchange by the Other Holders of outstanding convertible

promissory notes in the aggregate principal amount of $ 419,945 , $ 25,115 in accrued interest, and warrants to purchase of an aggregate

of 236,411 shares of the Company’s common stock for the units that are issued in the Public Offering.

On November 9, 2021, in connection

with the Public Offering, the Company issued the Other Holders an aggregate of 94,942 shares of the Company’s common stock and

warrants for the purchase of an aggregate of 94,942 shares of common stock.

November 9, 2021, pursuant to the terms of their convertible notes, the Company issued to two noteholders an aggregate of 85,416 shares

of common stock, with a fair value of $ 10.00 per share, and warrants for the purchase of an aggregate of 85,416 shares of common stock,

upon the conversion of an aggregate principal and accrued interest amount of $ 800,000 and $ 54,159 , respectively, upon the Company’s

listing on the Nasdaq Capital Market.

October 2021, the Company received an exercise notice to issue an aggregate of 22,917 shares of common stock to a warrant holder, with

a fair value of $ 240 per share, pursuant to a warrant associated with the Plan.

As of the date of this report the shares have yet to

October 27, 2021, the Company effected a 1-for-4,000 reverse stock split .

The Company has retroactively

applied the reverse stock split, including the rounding up of 6,858

fractional shares , effective on

October 27, 2021 to share and per share amounts on the unaudited condensed consolidated financial statements for the three and nine months

ended September 30, 2021 and the year ended December 31, 2020.

The Company’s authorized shares of common stock and preferred stock

were not affected as a result of the reverse stock split.

November 9, 2021, the Company completed a public offering of units, each consisting of one share of common stock and a warrant for

the purchase of one share of common stock.

Pursuant to the public offering, the Company issued and sold 2,300,000

units at a public offering price of $ 10.00

per unit, and, pursuant to the exercise of an option granted to the underwriters, warrants for the purchase of 345,000

shares of common stock at a public offering price of $ 0.01

per warrant, less underwriting discounts and commissions.

The Company received net proceeds of approximately $ 20,772,000

from the public offering, after deducting underwriting discounts and commissions of $ 1,610,000

and estimated offering costs of $ 600,000 .

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