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 September 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 November 10, 2021 was 7,391,391.

TABLE OF CONTENTS

	Page

PART I - FINANCIAL INFORMATION	3

Item 1. Unaudited Financial Statements	3

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

Consolidated Statements of Operations for the Three and Nine months Ended September 30, 2021 and 2020	4

Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2021 and 2020	5

Consolidated Statements of Changes in Stockholders’ Deficit for the Three and Nine Months Ended September 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	26

Item 3. Quantitative and Qualitative Disclosure About Market Risk	31

Item 4. Controls and Procedures	31

PART II - OTHER INFORMATION	32

Item 1. Legal Proceedings	32

Item 1A. Risk Factors	32

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	32

Item 3. Defaults Upon Senior Securities	33

Item 4. Mine Safety Disclosures	33

Item 5. Other Information	33

Item 6. Exhibits	34

SIGNATURES	35

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

PRESSURE BIOSCIENCES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	September 30, 2021			December 31, 2020
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	663,651		$	18,540
Accounts receivable		538,632			131,228
Inventories, net of $342,496 reserve at September 30, 2021 and December 31, 2020		796,418			592,767
Prepaid expenses and other current assets		620,960			314,936
Total current assets		2,619,661			1,057,471
Investment in equity securities		112,550			517,001
Property and equipment, net		2,366			16,490
Right of use asset leases		173,274			221,432
Intangible assets, net		425,481			490,385
TOTAL ASSETS	$	3,333,332		$	2,302,779
LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES
Accounts payable	$	418,020		$	771,945
Accrued employee compensation		142,375			417,578
Accrued professional fees and other		2,021,783			2,037,806
Other current liabilities		7,108,447			6,330,722
Deferred revenue		44,176			47,328
Convertible debt, net of unamortized discounts of $2,692,163 and $3,948,167, respectively		11,760,299			7,545,670
Other debt, net of unamortized discounts of $1,291 and $0, respectively		1,070,526			1,135,469
Operating lease liability		71,301			65,193
Other related party debt		38,000			166,000
Total current liabilities		22,674,927			18,517,711
LONG TERM LIABILITIES
Long term debt		527,038			527,039
Operating lease liability – long term		101,973			156,239
Deferred revenue		8,654			19,382
TOTAL LIABILITIES		23,312,592			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 September 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 September 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 September 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 September 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 September 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 September 30, 2021 and December 31, 2020, respectively		68			68
Series AA Convertible Preferred Stock, $.01 par value; 10,000 shares authorized; 8,649 and 8,043 shares issued and outstanding on September 30, 2021 and December 31, 2020, respectively		87			81
Convertible preferred stock
Common stock, $.01 par value; 100,000,000 shares authorized; 8,345,120 and 4,168,324 shares issued and outstanding on September 30, 2021 and December 31, 2020 respectively		83,451			41,683
Warrants to acquire common stock		31,607,879			29,192,471
Additional paid-in capital		62,307,524			50,312,968
Accumulated deficit		(113,979,213	)		(96,465,807	)
Total stockholders’ deficit		(19,979,260	)		(16,917,592	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	3,333,332		$	2,302,779

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

PRESSURE BIOSCIENCES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	2021			2020			2021			2020
	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2021			2020			2021			2020
Revenue:
Products, services, other	$	518,365		$	533,862		$	1,687,166		$	1,055,889
Total revenue		518,365			533,862			1,687,166			1,055,889

Costs and expenses:
Cost of products and services		258,170			247,013			771,105			557,041
Research and development		282,622			247,432			839,072			807,724
Selling and marketing		66,068			173,372			252,209			524,586
General and administrative		1,154,063			684,807			2,788,779			2,711,032
Total operating costs and expenses		1,760,923			1,352,624			4,651,165			4,600,383

Operating loss		(1,242,558	)		(818,762	)		(2,963,999	)		(3,544,494	)

Other (expense) income:
Interest expense, net		(3,330,101	)		(2,204,593	)		(11,524,306	)		(5,501,272	)
Unrealized (loss) gain on investment in equity securities		(162,071	)		140,461			(404,451	)		486,723
Loss on extinguishment of liabilities		(277,010	)		(395,854	)		(1,500,395	)		(3,242,372	)
Other income		60,627			-			119,280			-
Total other expense		(3,708,555	)		(2,459,986	)		(13,309,872	)		(8,256,921	)

Net loss		(4,951,113	)		(3,278,748	)		(16,273,871	)		(11,801,415	)
Deemed dividends on beneficial conversion feature		(815,914	)		-			(873,798	)		-
Preferred stock dividends		(432,149	)		(396,970	)		(1,239,535	)		(1,118,526	)
Net loss attributable to common stockholders	$	(6,199,176	)	$	(3,675,718	)	$	(18,387,204	)	$	(12,919,941	)
Basic and diluted net loss per share attributable to common stockholders	$	(0.82	)	$	(1.02	)	$	(3.02	)	$	(4.22	)

Weighted average common stock shares outstanding used in the basic and diluted net loss per share calculation		7,561,728			3,612,958			6,083,017			3,059,095

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

PRESSURE BIOSCIENCES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	2021			2020
	For the Nine Months Ended
	September 30,
	2021			2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(16,273,871	)	$	(11,801,415	)
Adjustments to reconcile net loss to net cash used in operating activities:
Gain on loan forgiveness		(367,039	)		-
Non-cash lease expense		48,158			55,628
Common stock and warrants issued for interest and extension fees		6,208,696			242,350
Depreciation and amortization		83,531			103,424
Accretion of interest and amortization of debt discount		5,308,424			3,454,470
Loss on extinguishment of accrued liabilities and debt		23,004			1,036,638
Stock-based compensation expense		219,943			373,652
Loss (Gain) on investment in equity securities		404,451			(486,723	)
Common stock issued for services		579,512			87,963
Changes in operating assets and liabilities:
Accounts receivable		(407,404	)		(101,057	)
Inventories		(203,651	)		101,511
Prepaid expenses and other assets		(306,024	)		53,810
Accounts payable		(336,675	)		(109,445	)
Accrued employee compensation		39,801			(609	)
Operating lease liability		(48,158	)		(55,628	)
Deferred revenue and other accrued expenses		943,400			3,138,667
Net cash used in operating activities		(4,083,902	)		(3,906,764	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Advance on loan receivable		-			(801,250	)
Purchases of property plant and equipment		(4,503	)		(1,663	)
Net cash used in investing activities		(4,503	)		(802,913	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from Series AA Convertible Preferred Stock		1,015,000			-
Proceeds from stock option exercises		14,773			-
Net proceeds from convertible debt		5,054,500			6,977,800
Net proceeds from non-convertible debt – third party		1,610,688			990,539
Net proceeds from non-convertible debt – related party		194,600			38,500
Payments on convertible debt		(1,608,295	)		(1,972,007	)
Payments on non-convertible debt – related party		(256,600	)		(15,000	)
Payments on non-convertible debt		(1,291,150	)		(1,245,028	)
Net cash provided by financing activities		4,733,516			4,774,804

NET INCREASE IN CASH AND CASH EQUIVALENTS		645,111			65,127
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		18,540			29,625
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	663,651		$	94,752

SUPPLEMENTAL INFORMATION
Interest paid in cash	$	802,084		$	530,009
NON CASH TRANSACTIONS:
Common stock issued for non-cash warrant exercise		363			-
Loan extension fees and interest added to principal		-			152,552
Common stock issued to settle accrued liabilities		-			127,855
Common stock issued with debt		551,198			147,775
Discount from warrants issued with debt		1,403,546			4,261,055
Common stock issued in lieu of cash for dividend		114,298			221,374
Preferred stock dividends		1,239,535			1,118,526
Conversion of debt and interest into common stock		2,589,990			1,830,543
Discount due to beneficial conversion feature		1,231,528			1,353,694
Deemed dividend - beneficial conversion feature		873,798			-
Conversion of accrued liabilities and debt for Series AA preferred stock		500,250			110,000
Common stock issued for debt settlement		-			374,550

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

PRESSURE BIOSCIENCES, INC. AND SUBSIDIARIES

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		7939	$	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
Issuance of common stock for non-cash warrant exercise
Issuance of common stock for non-cash warrant exercise, shares
Stock option exercise
Stock option exercise, shares
Series AA Preferred Stock dividend		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-				(324,586	)		(324,586	)
Conversion of debt and interest for common stock
Conversion of debt and interest for common stock, shares
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
Series AA Preferred Stock issued for settlement of liabilities
Series AA Preferred Stock issued for settlement of liabilities, shares
Series AA Preferred Stock offering
Series AA Preferred Stock offering, shares
Beneficial conversion feature on debt		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		404,608		-			404,608
Beneficial conversion option on convertible preferred stock
Warrants issued for debt extension		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		609,143		-		-			609,143
Issuance of common stock for debt extension and interest paid in kind		-		-		-		-		-		-		-		-		-		-		-		-		-		-		38,521		385		-		60,175		-			60,560
Conversion of debt and interest for common stock
Conversion of debt and interest for common stock, shares
Warrants issued with debt		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		1,205,010		-		-			1,205,010
Deemed dividend on convertible preferred stock
Stock issued with debt
Stock issued with debt, shares
Net loss		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		(3,953,885	)		(3,953,885	)
BALANCE, March 31, 2020		300	$	3		80,570	$	806		10,000	$	100		21	$	-		3,458	$	35		6,880	$	68		7,939	$	80		2,664,641	$	26,646	$	24,413,330	$	45,119,747	$	(83,220,748	)	$	(13,659,933	)
Stock-based compensation		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		65,341		-			65,341
Series AA Preferred Stock dividend		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		(396,970	)		(396,970	)
Beneficial conversion feature on debt		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		577,489		-			577,489
Issuance of common stock for services		-		-		-		-		-		-		-		-		-		-		-		-		-		-		25,000		250		-		87,713		-			87,963
Issuance of common stock for interest paid-in-kind		-		-		-		-		-		-		-		-		-		-		-		-		-		-		42,510		425		-		98,799		-			99,224
Issuance of common stock for dividends paid-in-kind		-		-		-		-		-		-		-		-		-		-		-		-		-		-		64,388		644		-		176,104		-			176,748
Conversion of debt and interest for common stock		-		-		-		-		-		-		-		-		-		-		-		-		-		-		410,746		4,107		-		1,288,542		-			1,292,649
Warrants issued with debt		-		-		-		-		-		-		-		-		-		-		-		-		-		-				-		1,753,683		-		-			1,753,683
Warrants issued for debt extension		-		-		-		-		-		-		-		-		-		-		-		-		-		-				-		360,602		-		-			360,602
Net loss		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		(4,568,782	)		(4,568,782	)
BALANCE, June 30, 2020		300	$	3		80,570	$	806		10,000	$	100		21	$	-		3,458	$	35		6,880	$	68		7,939	$	80		3,207,285	$	32,072	$	26,527,615	$	47,413,735	$	(88,186,500	)	$	(14,211,986	)
Stock-based compensation		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		66,542		-			66,542
Issuance of common stock for interest paid-in-kind		-		-		-		-		-		-		-		-		-		-		-		-		-		-		46,021		460		-		82,106		-			82,566
Issuance of common stock for dividends paid-in-kind		-		-		-		-		-		-		-		-		-		-		-		-		-		-		23,130		232		-		44,394		-			44,626
Series AA Preferred Stock dividend		-		-		-		-		-		-		-		-						-		-		-		-		-		-		-		-		(396,970	)		(396,970	)
Conversion of debt and interest for common stock		-		-		-		-		-		-		-		-		-		-		-		-		-		-		299,042		2,990		-		534,904		-			537,894
Warrants issued with debt		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		1,302,362				-			1,302,362
Conversion of debt into Series AA convertible preferred stock		-		-		-		-		-		-		-		-		-		-		-		-		44		-		-		-		38,783		71,217		-			110,000
Beneficial conversion feature on debt		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		371,597		-			371,597
Common stock issued for debt settlement		-		-		-		-		-		-		-		-		-		-		-		-		-		-		178,778		1,788		-		347,762		-			349,550
Warrants issued for debt settlement		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		338,412		-		-			338,412
Common Stock issued with debt		-		-		-		-		-		-		-		-		-		-		-		-		-		-		85,000		850		-		146,925		-			147,775
Net loss		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		(3,278,748	)		(3,278,748	)
BALANCE, September 30, 2020		300	$	3		80,570	$	806		10,000	$	100		21	$	-		3,458	$	35		6,880	$	68		7,983	$	80		3,839,256	$	38,392	$	28,207,172	$	49,079,182	$	(91,862,218	)	$	(14,536,380	)

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’

Amount

Warrants

Capital

Deficit