UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2021

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from _____________ to _____________

Commission File Number 001-38185

PRESSURE BIOSCIENCES, INC.

(Exact name of registrant as specified in its charter)

Massachusetts		04-2652826
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

14 Norfolk Avenue
South Easton, Massachusetts		02375
(Address of principal executive offices)		(Zip Code)

(508) 230-1828

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
N/A		N/A		N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☒	Smaller Reporting Company	☒
Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2 of the Exchange Act).

☐ Yes ☒ No

The number of shares outstanding of the Issuer’s common stock as of August 11, 2021 was 6,371,190.

TABLE OF CONTENTS

	Page

PART I - FINANCIAL INFORMATION	3

Item 1. Unaudited Financial Statements	3

Consolidated Balance Sheets as of June 30, 2021 and December 31, 2020	3

Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2021 and 2020	4

Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2021 and 2020	5

Consolidated Statements of Changes in Stockholders’ Deficit for the Three and Six Months Ended June 30, 2021 and 2020	6

Notes to Unaudited Consolidated Financial Statements	8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	27

Item 3. Quantitative and Qualitative Disclosure About Market Risk	32

Item 4. Controls and Procedures	32

PART II - OTHER INFORMATION	33

Item 1. Legal Proceedings	33

Item 1A. Risk Factors	33

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	34

Item 3. Defaults Upon Senior Securities	34

Item 4. Mine Safety Disclosures	34

Item 5. Other Information	34

Item 6. Exhibits	35

SIGNATURES	36

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

PRESSURE BIOSCIENCES, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	June 30, 2021			December 31, 2020
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	46,625		$	18,540
Accounts receivable		629,766			131,228
Inventories, net of $342,496 reserve at June 30, 2021 and December 31, 2020		492,095			592,767
Prepaid expenses and other current assets		219,161			314,936
Total current assets		1,387,647			1,057,471
Investment in equity securities		274,621			517,001
Property and equipment, net		7,431			16,490
Right of use asset leases		189,808			221,432
Intangible assets, net		447,115			490,385
TOTAL ASSETS	$	2,306,622		$	2,302,779
LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES
Accounts payable	$	628,835		$	771,945
Accrued employee compensation		420,510			417,578
Accrued professional fees and other		2,163,563			2,037,806
Other current liabilities		8,165,281			6,330,722
Deferred revenue		49,189			47,328
Convertible debt, net of unamortized discounts of $2,353,152 and $3,948,167, respectively		10,909,314			7,545,670
Other debt, net of unamortized discounts of $5,495 and $0, respectively		1,363,931			1,135,469
Operating lease liability		69,204			65,193
Other related party debt		184,600			166,000
Total current liabilities		23,954,427			18,517,711
LONG TERM LIABILITIES
Long term debt		527,038			527,039
Operating lease liability – long term		120,604			156,239
Deferred revenue		7,446			19,382
TOTAL LIABILITIES		24,609,515			19,220,371
COMMITMENTS AND CONTINGENCIES (Note 4)
STOCKHOLDERS’ DEFICIT
Series D Convertible Preferred Stock, $.01 par value; 850 shares authorized; 300 shares issued and outstanding on June 30, 2021 and December 31, 2020, respectively (Liquidation value of $300,000)		3			3
Series G Convertible Preferred Stock, $.01 par value; 240,000 shares authorized; 80,570 shares issued and outstanding on June 30, 2021 and December 31, 2020, respectively		806			806
Series H Convertible Preferred Stock, $.01 par value; 10,000 shares authorized; 10,000 shares issued and outstanding on June 30, 2021 and December 31, 2020, respectively		100			100
Series H2 Convertible Preferred Stock, $.01 par value; 21 shares authorized; 21 shares issued and outstanding on June 30, 2021 and December 31, 2020, respectively		-			-
Series J Convertible Preferred Stock, $.01 par value; 6,250 shares authorized; 3,458 shares issued and outstanding on June 30, 2021 and December 31, 2020, respectively		35			35
Series K Convertible Preferred Stock, $.01 par value; 15,000 shares authorized; 6,880 shares issued and outstanding on June 30, 2021 and December 31, 2020, respectively		68			68
Series AA Convertible Preferred Stock, $.01 par value; 10,000 shares authorized; 8,083 and 8,043 shares issued and outstanding on June 30, 2021 and December 31, 2020, respectively		81			81
Common stock, $.01 par value; 100,000,000 shares authorized; 6,260,884 and 4,168,324 shares issued and outstanding on June 30, 2021 and December 31, 2020 respectively		62,608			41,683
Warrants to acquire common stock		30,911,495			29,192,471
Additional paid-in capital		55,317,862			50,312,968
Accumulated deficit		(108,595,951	)		(96,465,807	)
Total stockholders’ deficit		(22,302,893	)		(16,917,592	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	2,306,622		$	2,302,779

The accompanying notes are an integral part of these unaudited consolidated financial statements

PRESSURE BIOSCIENCES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	2021			2020			2021			2020
	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2021			2020			2021			2020
Revenue:
Products, services, other	$	608,927		$	268,154		$	1,168,801		$	522,027
Total revenue		608,927			268,154			1,168,801			522,027

Costs and expenses:
Cost of products and services		286,660			134,882			512,935			310,028
Research and development		256,507			294,602			556,450			560,292
Selling and marketing		92,813			162,098			186,141			351,214
General and administrative		619,286			1,007,215			1,634,716			2,026,225
Total operating costs and expenses		1,255,266			1,598,797			2,890,242			3,247,759

Operating loss		(646,339	)		(1,330,643	)		(1,721,441	)		(2,725,732	)

Other (expense) income:
Interest expense, net		(3,526,141	)		(1,724,879	)		(8,194,205	)		(3,296,679	)
Unrealized (loss) gain on investment in equity securities		(134,477	)		196,891			(242,380	)		346,262
Loss on extinguishment of liabilities		(498,226	)		(1,710,151	)		(1,223,385	)		(2,846,518	)
Other income		60,012			-			58,653			-
Total other expense		(4,098,832	)		(3,238,139	)		(9,601,317	)		(5,796,935	)

Net loss		(4,745,171	)		(4,568,782	)		(11,322,758	)		(8,522,667	)
Deemed dividends on beneficial conversion feature		-			-			(57,884	)		-
Preferred stock dividends		(404,171	)		(396,970	)		(807,386	)		(721,556	)
Net loss attributable to common stockholders	$	(5,149,342	)	$	(4,965,752	)	$	(12,188,028	)	$	(9,244,223	)
Basic and diluted net loss per share attributable to common stockholders	$	(0.90	)	$	(1.70	)	$	(2.29	)	$	(3.34	)

Weighted average common stock shares outstanding used in the basic and diluted net loss per share calculation		5,748,711			2,914,659			5,312,172			2,765,132

The accompanying notes are an integral part of these unaudited consolidated financial statements

PRESSURE BIOSCIENCES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	2021			2020
	For the Six Months Ended
	June 30,
	2021			2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(11,322,758	)	$	(8,522,667	)
Adjustments to reconcile net loss to net cash used in operating activities:
Gain on loan forgiveness		(367,039	)		-
Non-cash lease expense		31,624			35,927
Common stock and warrants issued for interest and extension fees		4,054,749			159,784
Depreciation and amortization		56,291			74,247
Accretion of interest and amortization of debt discount		3,909,024			1,750,911
Loss on extinguishment of accrued liabilities and debt		-			977,622
Stock-based compensation expense		124,695			307,110
Loss (Gain) on investment in equity securities		242,380			(346,262	)
Common stock issued for services		238,512			87,963
Changes in operating assets and liabilities:
Accounts receivable		(498,538	)		108,096
Inventories		100,672			2,853
Prepaid expenses and other assets		95,775			20,944
Accounts payable		(143,110	)		(5,927	)
Accrued employee compensation		2,932			(58,775	)
Operating lease liability		(31,624	)		(35,927	)
Deferred revenue and other accrued expenses		1,415,688			2,643,607
Net cash used in operating activities		(2,090,727	)		(2,800,494	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Advance on loan receivable		-			(531,250	)
Purchases of property plant and equipment		(3,962	)		(1,663	)
Net cash used in investing activities		(3,962	)		(532,913	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from Series AA Convertible Preferred Stock		100,000			-
Proceeds from stock option exercises		14,773			-
Net proceeds from convertible debt		2,598,250			4,422,600
Net proceeds from non-convertible debt – third party		1,183,188			990,539
Net proceeds from non-convertible debt – related party		171,600			8,500
Payments on convertible debt		(1,200,996	)		(1,257,250	)
Payments on non-convertible debt – related party		(153,000	)		-
Payments on non-convertible debt		(591,041	)		(819,149	)
Net cash provided by financing activities		2,122,774			3,345,240

NET INCREASE IN CASH AND CASH EQUIVALENTS		28,085			11,833
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		18,540			29,625
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	46,625		$	41,458

SUPPLEMENTAL INFORMATION
Interest paid in cash	$	383,403		$	419,817
NON CASH TRANSACTIONS:
Interest added to principal		-			152,552
Common stock issued to settle accrued liabilities		-			127,855
Common stock issued with debt		112,877			-
Discount from warrants issued with debt		1,068,842			2,958,693
Common stock issued in lieu of cash for dividend		114,298			176,748
Preferred stock dividends		807,386			721,556
Conversion of debt and interest into common stock		349,250			1,317,649
Discount due to beneficial conversion feature		566,847			982,097
Deemed dividend - beneficial conversion feature		57,884			-

The accompanying notes are an integral part of these unaudited consolidated financial statements

PRESSURE BIOSCIENCES, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

(UNAUDITED)

	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Shares			Amount		Warrants		Capital		Deficit			Deficit
	Series D Preferred Stock				Series G Preferred Stock				Series H Preferred Stock				Series H(2) Preferred Stock				Series J Preferred Stock				Series K Preferred Stock				Series AA Preferred Stock				Common Stock					Stock		Additional Paid-In		Accumulated			Total Stockholders'
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Shares			Amount		Warrants		Capital		Deficit			Deficit
BALANCE, December 31, 2019		300	$	3		80,570	$	806		10,000	$	100		21	$	-		3,458	$	35		6,880	$	68		7,939	$	80		2,549,620		$	25,496	$	22,599,177	$	44,261,105	$	(78,942,277	)	$	(12,055,407	)
Stock-based compensation		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-			-		-		241,769		-			241,769
Stock option exercise
Stock option exercise, shares
Series AA Preferred Stock dividend		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-			-		-		-		(324,586	)		(324,586	)
Issuance of common stock to settle accrued liabilities		-		-		-		-		-		-		-		-		-		-		-		-		-		-		66,500			665		-		127,190		-			127,855
Common stock issued for debt settlement		-		-		-		-		-		-		-		-		-		-		-		-		-		-		10,000			100		-		24,900		-			25,000
Issuance of common stock for debt extension and interest paid in kind		-		-		-		-		-		-		-		-		-		-		-		-		-		-		38,521			385		-		60,175		-			60,560
Issuance of common stock for services
Issuance of common stock for services, shares
Issuance of common stock warrants for interest paid-in-kind
Issuance of common stock warrants for interest paid-in-kind, shares
Beneficial conversion feature on debt		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-			-		-		404,608		-			404,608
Warrants issued with debt		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-			-		1,205,010		-		-			1,205,010
Warrants issued for debt extension		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-			-		609,143		-		-			609,143
Common Stock issued for extinguishment of liabilities
Common Stock issued for extinguishment of liabilities, shares
Series AA Preferred Stock offering
Series AA Preferred Stock offering, shares																															<