What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2022-05-16 compared with 2021-11-15 · 117 added, 228 removed, 113 unchanged (75% of the section changed)

14 unchanged sentences

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.

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

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

set forth in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations

– Factors That May Affect Future Results and Financial Condition” in our Annual Report on Form 10-K for the fiscal year ended

December 31, 2021, as filed with the U.S.

Securities and Exchange Commission (the “SEC”) on March 30, 2022, 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 complete our clinical trials and implement our business plan;

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;

as well as our metabolic ThermoStem Program;

possible lack of exclusive rights with regard to our licensed technology;

ability to protect our proprietary rights;

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

ThermoStem and Stem Pearls .

and ThermoStem .

We also own an allowed trademark application for BRTX .

The Dragonfly Logo is also registered with

The Dragonfly Logo is also registered with the U.S.

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

other organizations.

This report may also include 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

or ™ symbols, and copyrighted content appears without the use of the symbol ©, but the absence of use of these symbols

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

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

We 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 2022 (assuming the receipt of necessary funding).

or ™ symbols, and copyrighted content appears without the use of the symbol ©, but the absence of use of these symbols does

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

offices are located in Melville, New York where we have established a laboratory facility in order to increase our capabilities for the

further development of possible cellular-based treatments, products and protocols, stem cell-related intellectual property and translational

research applications.

of March 31, 2022, our accumulated deficit was $138,962,278.

We have historically only generated a modest amount of revenue, and

our losses have principally been operating expenses incurred in research and development, marketing and promotional activities in order

to commercialize our products and services, plus costs associated with meeting the requirements of being a public company.

to continue to incur substantial costs for these activities over at least the next year.

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 .

In March 2022, a United States patent issued in our Disc/Spine Program .

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 and have commenced such clinical

trial through the execution of a CRO agreement with PRC Clinical, the commencement of clinical trial site identification, the purchase

of manufacturing equipment and the expansion of our laboratory to include capabilities for clinical production.

We have obtained a license

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Australian patents related to the ThermoStem Program were issued in

April 2017, June and October 2019, and August 2021;

Japanese patents related to the ThermoStem Program were issued

in December 2017 and June 2021;

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

April 2017, October 2019 and August 2021;

Japanese patents related to the ThermoStem Program were issued in December 2017 and

a notice of allowance also issued in January 2022 for a separate Japanese application in our ThermoStem Program and

is expected to issue in the near future;

Israeli patents related to our ThermoStem Program were issued in October 2019 and May

a notice of allowance also issued in September 2021 for a separate Israeli application in our ThermoStem Program and is

expected to issue in the near future;

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

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to BRTX-100 .

On October 27, 2021, we effected

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

We have 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.

Our authorized shares of common stock and preferred stock were not affected as a result of

the reverse stock split.

We derived all of our revenue

pursuant to a license agreement with the SCTC entered into in January 2012, as amended in November 2015.

Pursuant to the license agreement,

the SCTC granted to us a license to use certain intellectual property related to, among other things, stem cell disc procedures and we

have 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 us royalties on a per disc procedure basis.

derived all of our revenue pursuant to a license agreement with the SCTC entered into in January 2012, as amended in November 2015.

to the license agreement, the SCTC granted to us a license to use certain intellectual property related to, among other things, stem

cell disc procedures and we have 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 us royalties on a per disc procedure basis.

of Operations

of the Three Months Ended September 30, 2021 to the Three Months Ended September 30, 2020

financial results for the three months ended September 30, 2021 are summarized as follows in comparison to the three months ended September

For The Three Months Ended

September 30,

Operating Expenses:

Marketing and promotion

Research and development

General and administrative

Total Operating Expenses

Loss From Operations

Other Expense:

Interest expense

Reorganization items, net

Total Other Expense

$ (4,184,232 )

the three months ended September 30, 2021 and 2020, we generated $8,000 and $15,000, 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 September 30, 2021 and 2020, marketing and promotion expenses remained consistent.

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.

Consulting expenses consist

of consulting fees and stock-based compensation to consultants.

For the three months ended September 30, 2021, consulting expenses decreased

by $33,594, or 100%, from $33,594 to $0, as compared to the three months ended September 30, 2020.

The decrease is primarily due to our

reduced usage of consultants as we continue to emerge from our 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 September 30, 2021, research and development expenses decreased

by $13,626, or 5%, from $251,036 to $237,410, as compared to the three months ended September 30, 2020.

The decrease is primarily due

to a small decrease in stock compensation expense attributable to research and development.

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

the quarter ended December 31, 2021 and subsequent fiscal periods.

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.

of the Three Months Ended March 31, 2022 to the Three Months Ended March 31, 2021

financial results for the three months ended March 31, 2022 are summarized as follows in comparison to the three months ended March 31,

For The Three Months Ended

September 30, 2021, general and administrative expenses increased by $3,118,492, or 916%, from $340,485 to $3,458,977,

as compared to the three months ended September 30, 2020.

The increase is primarily due to an increase of approximately $2,800,000

in stock-based compensation resulting from the issuances of 586,959 stock options and 293,479 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 September 30, 2021, interest expense increased $452,934, or 1,063%, as compared to the three months ended

September 30, 2020.

The increase was due to the increase in both interest and amortization of debt discount on outstanding notes payable

as a result of our restructuring under our Chapter 11 reorganization.

Reorganization

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

For the three months ended September 30, 2021,

we did not record reorganization items, net as compared to reorganization items, net of ($183,387) for the three months ended September

of the Nine Months Ended September 30, 2021 to the Nine Months Ended September 30, 2020

financial results for the nine months ended September 30, 2021 are summarized as follows in comparison to the nine months ended September

For The Nine Months Ended

September 30,

Operating Expenses:

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Interest expense

Loss on extinguishment of notes payable, net

Change in fair value of derivative liabilities

Reorganization items, net

Total Other Expense

Gain on PPP loan forgiveness

Amortization of debt discount

Total Other (Income) Expense

$ (4,816,150 )

$ (15,653,330 )

the nine months ended September 30, 2021 and 2020, we generated $41,000 and $60,000, respectively, of royalty revenue in connection with

the three months ended March 31, 2022 and 2021, we generated $16,000 and $18,000, respectively, of royalty revenue in connection with

our sublicense agreement.

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

months ended September 30, 2021, marketing and promotion expenses decreased by $19,011, or 68%, from $28,131 to $9,120, as compared to

the nine months ended September 30, 2020.

The decrease is primarily due to our reduced marketing plan as we continue to

emerge from our Chapter 11 reorganization.

For the three

months ended March 31, 2022 and 2021, marketing and promotion expenses were insignificant.

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

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

For the nine months ended September 30, 2021, consulting

expenses decreased by $91,158, or 90%, from $101,195 to $10,037, as compared to the nine months ended September 30, 2020.

is primarily due to our reduced usage of consultants as we continue to emerge from our Chapter 11 reorganization.

For the three months ended March 31, 2022, consulting

expenses increased by $77,862, from $8,389 to $86,071, as compared to the three months ended March 31, 2021, primarily due to stock-based

compensation of $72,818 issued to consultants during the three months ended March 31, 2022.

and Development

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expenses are expensed as they are incurred.

For the nine months ended September 30, 2021, research and development expenses decreased

by $135,355, or 19%, from $698,917 to $563,562, as compared to the nine months ended September 30, 2020.

The decrease is primarily due

to the decrease in stock compensation allocated to our 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.

For the three months ended March 31, 2022, research and development expenses increased by

$610,083, or 369%, from $165,254 to $775,337, as compared to the three months ended March 31, 2021, as we recommenced

our research and development initiatives following the completion of our public offering of common stock and warrants in November 2021.

expect that our higher level of research and development expenses will continue in subsequent fiscal periods.

and Administrative

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

For the nine months ended

September 30, 2021, general and administrative expenses increased by $20,627,669, or 1,827%, from $1,129,218 to $21,765,887,

as compared to the nine months ended September 30, 2020.

The increase is primarily due to an increase of approximately $19,500,000 in

stock-based compensation resulting from the issuances of 586,959 stock options and 293,479 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 nine months ended September 30, 2021, interest expense increased $189,089, or 13%, as compared to the nine months ended September

The increase was due to the increase in both interest and amortization of debt discount on outstanding notes payable as a result

of our restructuring under our Chapter 11 reorganization.

on extinguishment of notes payable, net

the nine months ended September 30, 2021, we did not record a gain (loss) on extinguishment of notes payable, as compared to a loss on

extinguishment of notes payable of $658,152 for the nine months ended September 30, 2020.

in fair value of derivative liabilities

the nine months ended September 30, 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 nine months ended September

Reorganization

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

For the nine months ended September 30, 2021,

we did not record reorganization items, net as compared to reorganization items, net of $597,919 for the nine months ended September

For the three months ended

March 31, 2022, general and administrative expenses decreased by $10,688,497, or 72%, from $14,896,413 to $4,207,916, as compared to

the three months ended March 31, 2021.

The decrease is primarily due to a decrease of approximately $10.7 million in stock-based compensation

resulting from the effect of the issuances of 586,959 stock options and 293,479 RSUs during the three months ended March 31, 2021.

expect that our general and administrative expenses will 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, 2022, interest expense decreased $152,503, or 84%, as compared to the three months ended March 31, 2021.

The decrease was due to the exchange of our outstanding convertible debt for common and preferred shares and warrants in connection with

our public offering in November 2021.

on PPP loan forgiveness

the terms of the U.S.

Small Business Administration’s Paycheck Protection Program (“PPP”), our $250,000 PPP loan was

forgiven during the three months ended March 31, 2022.

of debt discount

of debt discount of $417,160 for the three months ended March 31, 2021 related to our convertible notes, which were exchanged for common

and preferred shares and warrants in connection with our public offering in November 2021, resulting in no comparable expense during

the three months ended March 31, 2022.

income of $16,654 during the three months ended March 31, 2022 consists of funding received under a $256,000 National Institutes of Health

Small Business Technology Transfer (STTR) Phase 1 grant, which we were awarded in September 2021.

and Capital Resources

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

September 30,

Working Capital

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of Additional Funds

upon our accumulated deficit and stockholders’ deficit of $113,742,990 and $4,879,304, respectively, as of September

30, 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 September 30, 2021, our outstanding debt of $10,041,342, together with interest at a rate of between 5% and 7% per annum, has

a maturity date of November 16, 2023, except for the PPP loan.

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.

upon our accumulated deficit of $138,962,278 as of March 31, 2022, along with our forecast for continued operating losses and

our need for financing to fund our contemplated clinical trials, we will eventually require additional equity and/or debt financing to

continue our operations.

operating needs include the planned costs to operate our business, including amounts required to fund our clinical trials, 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

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

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

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.

On November 9, 2021, we 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, we issued and sold 2,300,000 units at a publc 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.

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.

The following events have

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

(i) on November 9, 2021, we received net proceeds

of approximately $20,772,000 from our public offering, and (ii) in connection with the public offering, we exchanged all of our outstanding

convertible debt to shares of common stock, Series A preferred stock, and warrants.

As a result of the above, we have sufficient cash

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

the nine months ended September 30, 2021 and 2020, our sources and uses of cash were as follows:

Nine Months Ended September 30,

the three months ended March 31, 2022 and 2021, our sources and uses of cash were as follows:

Three Months Ended March 31,

Net cash used in operating activities

$ (1,594,634 )

$ (1,392,145 )

Net cash used in investing activities

Net cash provided by financing activities

Increase (decrease) in cash

Net decrease in cash

$ (1,704,207 )

cash used in operating activities was $2,184,894 for the nine months ended September 30, 2021, primarily due to the net loss of $23,900,157

which was primarily offset by non-cash expenses of $21,182,776 related primarily to amortization of debt discount and stock-based

compensation and $541,414 of cash provided by changes in the levels of operating assets and liabilities, primarily as a result of increases

in accrued interest and accounts payable, decreases in accounts receivable and prepaid and other current assets, all partially offset

by a decrease in lease liability.

Net cash used in operating activities was $1,392,145 for the nine months ended September 30, 2020,

primarily due to the net loss of $5,511,375, which was partially offset by non-cash expenses of $3,047,219 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 $1,072,011 of cash provided by changes in the levels of operating assets and liabilities, primarily as a result

of increases in accounts payable, accrued interest, expenses and other current liabilities and decreases in accounts receivable, prepaid

expenses and other current assets.

cash provided by financing activities for the nine months ended September 30, 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 nine months ended September 30, 2020, was $1,566,475, which was primarily due to $1,114,713

of proceeds from the DIP financing and $441,762 of net proceeds from debt 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 a result of the above, we have sufficient cash to fund operations

for the twelve months subsequent to the filing date.

cash used in operating activities was $1,594,634 for the three months ended March 31, 2022, primarily due to cash used to fund the net

loss of $4,816,150 and a non-cash gain of $250,000 on forgiveness of our PPP loan, which were partially offset by non-cash expenses

of $3,430,925 related primarily to stock-based compensation and $40,591 of cash provided by changes in the levels of operating

assets and liabilities, which was primarily due to increases in accounts payable and accrued expenses and other current liabilities,

partially offset by increases in accounts receivable and prepaid and other current assets and a decrease in the lease liability.

Net cash used in operating activities was $813,701 for the three months ended

March 31, 2021, primarily due to cash used to fund the net loss of $15,653,330, which was partially offset by non-cash expenses of $14,522,963

primarily related to stock-based compensation expense and amortization of debt discount and $316,666 of cash provided by changes in the

levels of operating assets and liabilities, primarily as a result of increases in accounts payable, accrued expenses and other current

liabilities and decreases in accounts receivable, prepaid expenses and other current assets.

cash used in investing activities consisted of $109,573 of equipment purchases during the three months ended March 31, 2022.

no cash flows from investing activities during the three months ended March 31, 2021.

were no cash flows from financing activities for the three months ended March 31, 2022.

Net cash provided by financing activities for

the three months ended March 31, 2021 consisted of $250,000 of net proceeds from a loan received under the U.S.

Small Business Administration’s

Paycheck Protection Program.

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

1 unchanged sentence

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

herein for the quarter ended September 30, 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.

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 September 30, 2021.

herein for the quarter ended March 31, 2022, and in the notes to our audited consolidated financial statements included in our Annual

Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on March 30, 2022.

Sheet Arrangements

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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 2. Management’s Discussion and Analysis