Item 2. Management’s Discussion and Analysis
Item 2. Management’s Discussion and Analysis
of Financial Condition and Results of Operations.
Note Regarding Forward Looking Statements
This report contains forward-looking statements
that reflect our current views about future events. We use the words “ anticipate ,” “ assume ,” “ believe ,”
“ estimate ,” “ expect ,” “ will ,” “ intend ,” “ may ,”
“ plan ,” “ project ,” “ should ,” “ could ,” “ seek ,”
“ designed ,” “ potential ,” “ forecast ,” “ target ,” “ objective ,”
“ goal ” or the negatives of such terms or other similar expressions. These statements relate to future events or our
future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our 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 by these forward-looking statements.
Overview
General
We are a medical robotics company developing a
fully autonomous medical robotic system using proprietary software which integrates Artificial Intelligence (“ AI ”)
and Deep Learning, or machine learning, (“ DL ”). By using an AI and DL enhanced software program, we are creating an
intelligent robotic system that we believe can “ robotize ” a wide range of medical procedures currently being performed
by human hands. We are concentrating our research and development efforts to meet rising expectations of patients and practitioners alike
for the precision, safety and speed offered by an AI enhanced robotics platform system that can be combined with proven medical devices,
end-effectors and surgical instruments.
We believe that progress in mechanical and software
engineering has made possible lightweight and relatively inexpensive robotic devices for difficult procedures in various medical fields.
Medical robots are already being successfully employed in several areas of surgery, including Urology (Prostate), Colo-Rectal, Gynecology,
Thoracic, General Surgery, Orthopedics, and Neuro and Spine Surgery. Robots are also being used for Telemedicine and assistive robotic
methods are addressing the delivery of healthcare in inaccessible locations, ranging from rural areas lacking specialist expertise to
post-disaster scenarios, and battlefield areas. With the aging population dominating demographics in the U.S. across all spectrums of
healthcare, robotic technologies are being developed toward promoting improved function, lower morbidity and improved overall outcomes.
12
Merger
On April 14, 2023, a wholly-owned subsidiary of
the Company merged with CardioVentures, Inc., a Delaware corporation, which is the indirect parent of Sudhir Srivastava Innovations Pvt.
Ltd., (“ SSI India ”) an Indian private limited company engaged in the business of developing innovative surgical robotic
technologies with a vision to make the benefits of robotic surgery affordable and accessible to a larger part of the global population.
SSII’s product range includes its proprietary “SSI Mantra” surgical robotic system and a wide range of surgical instruments
capable of supporting a variety of cardiac and other surgical procedures. The Company now intends to focus on the business of SSI-India
and has plans to globally expand the presence of its technologically advanced, user-friendly, and cost-effective surgical robotic solutions.
As a result of the transaction, a “ change
in control ” of the Company took place. In addition, among other matters, the Company changed its name to “ SS Innovations
International, Inc. ” and implemented a one for ten reverse stock split. The financial statements and financial information contained
in this report only reflect the operations of the Company prior to the acquisition and do not give pro forma effect to the reverse stock
split.
See Note 6 to the Notes to Financial Statements
included in Part I, Item 1 of this report for additional details regarding the acquisition.
Results of Operations
Introduction
The financial statements appearing elsewhere in
this report have been prepared assuming the Company will continue as a going concern. The Company was recently formed and has not established
sufficient operations or revenues to sustain the Company. These conditions raise substantial doubt about the Company’s ability to
continue as a going concern.
The following table provides selected balance
sheet data for our Company at March 31, 2023 (unaudited) and December 31, 2022:
Balance Sheet Data
As of
As of
March 31,
December 31,
2023
2022
Cash
$ 448,543
$ 1,351,364
Total Assets
$ 5,466,341
$ 4,371,441
Total Liabilities
$ 5,118,927
$ 4,051,229
Total Stockholders’ Equity
$ 347,414
$ 320,213
To date, the Company has relied on debt and equity
raised in private offerings and shareholder loans to finance operations and no other sources of capital has been identified. If we experience
a shortfall in operating capital, we could be faced with having to limit our research and development activities.
13
Three months ended March 31, 2023, as compared to
three months ended March 31, 2022
Revenues. We had no revenues during either
the three months ended March 31, 2023, or the three months ended March 31, 2022.
Research and Development Expenses. Research
and development expenses were $0 during the three months ended March 31, 2023, and for the three months ended March 31, 2022. Research
and development expenses reflect continuing development work on the Company’s prototype robotic system at its facilities at UCF’s
incubator in Orlando, Florida.
Compensation Expense. We had compensation
expenses of $1,592,309 and $28,240 during the three months ended no revenues during either the three months ended March 31, 2023 and March
31, 2022, respectively. This includes compensation for the management staff and stock-based compensation expense related to the Company’s
2016 Stock Incentive Plan.
General and Administrative Expenses. We
incurred $464,758 and $52,215 in general and administrative expenses during the three months ended March 31, 2023, and March 31, 2022,
respectively. General and administrative expenses include legal and other professional expenses related to the Company’s filings
as a public company with the Securities and Exchange Commission (the “ SEC ”).
Other Income/Expenses . We had $52,747 in
the first three quarters of 2023 as compared to $35 of other expenses during the three months ended March 31, 2022 consisting of interest
expense related to loans.
Net Loss. We incurred a net loss of $2,004,320
for the three months ended March 31, 2023, as compared to a net loss of $80,421 for the three months ended March 31, 2022.
Liquidity and Capital Resources
The Company expects to require substantial funds
for research and development, to continue to develop, secure marketing approval for and ultimately manufacture and market its initial
medical robotic system. Until the Company is able to generate revenues from the sale of its initial medical robotic system, it expects
to meet its operating cash flow requirements from the net proceeds of this Offering and if necessary, from future public or private sales
of its securities and, if possible, on favorable terms, by entering into development partnerships to assist the Company with its technology
development activities.
While we have been successful in raising
funds to fund our operations since inception and we believe that we will be successful in obtaining the necessary financing to fund our
operations going forward, we do not have any committed sources of funding and there are no assurances that we will be able to secure additional
funding. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern; however,
if the efforts noted above are not successful, it would raise substantial doubt about the Company’s ability to continue as a going
concern. If we cannot obtain financing, then we may be forced to further curtail our operations or consider other strategic alternatives.
Even if we are successful in raising the additional financing, there is no assurance regarding the terms of any additional investment
and any such investment or other strategic alternative would likely substantially dilute our current shareholders.
14
Critical Accounting Policies
Use of Estimates
The preparation of financial statements in conformity
with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant
estimates included deferred revenue, costs incurred related to deferred revenue, the useful lives of property and equipment and the useful
lives of intangible assets.
Income Taxes
The Company accounts for income taxes in accordance
with ASC 740, Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes. Under this method,
deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax
basis of assets and liabilities given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based
on changes to the assets or liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations
of the jurisdictions in which the Company operates, estimates of future taxable income, and available tax planning strategies. If
tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred
tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more
likely than not” criteria of ASC 740.
ASC 740-10 requires that the Company recognize
the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain
the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized
in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate
settlement with the relevant tax authority.
Off-Balance Sheet Arrangements
There are no off-balance sheet arrangements that
have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues
or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.
Item 3. Quantitative Disclosures About Market
Risks.
As a “ smaller reporting company, ”
we are not required to provide the information required by this Item.
15
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.