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<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
6 - Property And Equipment</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Property and equipment, net, consists of the
following:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Useful Life</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">March 31, 2020</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 45%"><font style="font-size: 10pt">Furniture and fixtures</font></td>
<td style="width: 1%"> </td>
<td style="width: 16%; text-align: center"><font style="font-size: 10pt">5-7 years</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 16%; text-align: right"><font style="font-size: 10pt">231,222</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 16%; text-align: right"><font style="font-size: 10pt">231,222</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Computers and software</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 10pt">3-7 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">244,039</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">244,039</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Leasehold improvements</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"><font style="font-size: 10pt">15 years</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">157,107</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">157,107</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">632,368</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">632,368</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Less accumulated depreciation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(434,772</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(412,665</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt"><b>Total</b></font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt; text-align: center"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">197,596</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">219,703</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Depreciation expense was approximately $22,000
and $27,000 for the three months ended March 31, 2020 and 2019, respectively. The Company uses the straight-line depreciation
method to calculate depreciation expense.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
6 - Property and Equipment</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Property and equipment, net, consists of the
following:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Useful Life</font></td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">December 31, 2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">December 31, 2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 46%"><font style="font: 10pt Times New Roman, Times, Serif">Furniture and fixtures</font></td>
<td style="width: 2%"> </td>
<td style="width: 14%; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">5-7 years</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 16%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">231,222</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">149,285</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Computers and software</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3-7 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">244,039</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">278,234</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Leasehold improvements</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">15 years</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">157,107</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">156,133</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">632,368</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">583,652</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Less accumulated depreciation</font></td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(412,665</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(316,736</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif"><b>Total</b></font></td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">219,703</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">266,916</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Depreciation expense was approximately $98,000
and $95,000, respectively, for the years ended December 31, 2019 and 2018. The Company uses the straight-line depreciation method
to calculate depreciation expense.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
2 - Liquidity, Going Concern and Management’s Plans</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">COVID-19 has adversely affected the Company’s
financial condition and results of operations. In the first quarter of 2020, the Company took steps to protect its vulnerable patient
base (elderly patients suffering from chronic lung disease) by cancelling all treatments effective March 23, 2020 through at least
the end of July. The Company made the decision in late March, to layoff approximately 40% of its employee base, including corporate
and clinical employees, and to cease operations at the LHI clinics in Tampa, Scottsdale, Pittsburgh, and Dallas. The Company will
reevaluate when operations will recommence at these clinics as more information about COVID-19 becomes available.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company incurred net losses of approximately
$2,416,000 and $3,695,000 for the three months ended March 31, 2020 and 2019, respectively. The Company has historically incurred
losses from operations and expects to continue to generate negative cash flows as the Company’s revenue activities are suspended
and as the Company implements its business plan. The consolidated financial statements are prepared using accounting principles
generally accepted in the United States (“U.S. GAAP”) as applicable to a going concern, which contemplates the realization
of assets and liquidation of liabilities in the normal course of business.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company will incur losses until sufficient
revenue is attained utilizing the infusion of capital resources to expand marketing and sales initiatives along with the development
of a L-CYTE-01 protocol and taking that protocol through the FDA process. Due to the coronavirus outbreak (“COVID-19”),
the Company is not expecting to be able to generate revenue until, at the earliest, August 2020. The Company has contacted its
patients that are scheduled to come in for treatment, both first time patients and recurring patients, and have rescheduled these
patients to August 2020. There is no guarantee that the Company will be able to treat patients as soon as August 2020; as such,
the Company cannot estimate when it will be safe to treat patients and generate revenue. The Company’s first quarter revenue
2020 was approximately $1,000,000 compared to fourth quarter 2019 revenue of approximately $1,800,000. The Company expects revenue
for the second quarter of 2020 will be nominal if any, and future quarters’ revenue is dependent on the timing of being able
to treat patients again. The Company will continue to focus on its goal of taking the L-CYTE-01 protocol to the FDA for treatment
of chronic lung diseases. The Company is currently evaluating if its protocol has the potential to help people affected by COVID-19,
but more research will need to be completed before a definitive conclusion can be reached.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company incurred net losses of approximately
$2,416,000 and $3,695,000 for the three months ended March 31, 2020 and 2019, respectively. The Company has historically incurred
losses from operations and expects to continue to generate negative cash flows as the Company’s revenue activities are suspended
and as the Company implements its business plan. The consolidated financial statements are prepared using accounting principles
generally accepted in the United States (“U.S. GAAP”) as applicable to a going concern, which contemplates the realization
of assets and liquidation of liabilities in the normal course of business.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">With the Company’s revenue-generating
activities suspended, the Company will need to raise cash from debt and equity offerings to continue with its efforts to take the
L-CYTE-01 protocol to the FDA for treatment of chronic lung diseases. There can be no assurance that the Company will be successful
in doing so.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On March 27, 2020, the Company issued a demand
note (the “Note”) in the principal amount of $500,000 to FWHC Bridge, LLC (the “Investor”) in exchange
for a loan made by the Investor in such amount to cover the Company’s working capital needs. Subsequently on April 9, 2020,
in exchange for an additional loan of $500,000 made by the Investor to the Company to further cover the Company’s working
capital needs, the Company amended and restated the Note to reflect a new principal amount of $1,000,000 (the “A&R Note”).
The A&R Note bears simple interest at a rate of 12% per annum. The Investor is an affiliate of FWHC Holdings, LLC, a pre-existing
shareholder of the Company, which served as lead investor in the Company’s recent Series D Convertible Preferred Stock Offering.
As discussed further below in “Note Purchase Agreement”, this A&R Note was further amended and superseded by an
April Secured Note in the amount of $1,000,000 issued by the Company to the Investor.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Note
Purchase Agreement</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 17, 2020, and in subsequent April
closings, the Company entered into a Secured Convertible Note and Warrant Purchase Agreement (the “April SPA”) with
thirty three investors (the “Purchasers”) pursuant to which the Company received an aggregate of $2,835,195 in gross
proceeds through the sale to the Purchasers of Secured Convertible Promissory Notes (the “April Secured Notes”) and
warrants (the “April Warrants”) to purchase shares of common stock of the Company (the “April Offering”).
The proceeds of the April Offering will be used for working capital and general corporate purposes. The April Offering resulted
in the issuance of April Secured Notes to Purchasers in an aggregate principal amount of $3,835,195. This sum included the issuance
by the Company to the Investor of an April Secured Note in the amount of $1,000,000 to amend and supersede the A&R Note previously
issued by the Company to the Investor on April 9, 2020. Additionally, in connection with the April Offering, the Company entered
into an amendment with the Investor with respect to the outstanding 12% Senior Secured Convertible Note due September 30, 2020,
which was originally issued in 2018 and assumed in the Merger and which was purchased by the Investor from its original holder,
George Hawes, on March 27, 2020 (the “Hawes Note”). The Hawes Notes had a principal amount of $424,615 as of March
31, 2020 and December 31, 2019. The amendment to the Hawes Note among other things, eliminates the requirement that the Company
make monthly payments of accrued interest. The Hawes Note is expected to convert into shares of preferred stock of the Company
offered for purchase at the Qualified Financing at the closing of the Qualified Financing.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As part of the April Offering, the holders
of certain existing warrants issued by the Company which contained anti-dilution price protection entered into agreements terminating
all anti-dilution price protection in their warrants. The Company intends to implement a one-time reduction of the exercise price
of such warrants to be equal to the price per share at which shares of preferred stock are offered for purchase at the Qualified
Financing once that price has been established.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Short-term
notes, related parties</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On March 27, 2020, the Company issued a demand
note (the “Note”) in the principal amount of $500,000 to FWHC Bridge, LLC (the “Investor”) in exchange
for a loan made by the Investor in such amount to cover the Company’s working capital needs. Subsequently on April 9, 2020,
in exchange for an additional loan of $500,000 made by the Investor to the Company, the Company amended and restated the Note to
reflect a new principal amount of $1,000,000 (the “A&R Note”). The A&R Note bears simple interest at a rate
of 12% per annum. The Investor is an affiliate of FWHC Holdings, LLC, a pre-existing shareholder of the Company, which served as
lead investor in the Company’s recent Series D Convertible Preferred Stock Offering. As discussed further above in “Note
Purchase Agreement”, this A&R Note was further amended and superseded by an April Secured Note in the amount of $1,000,000
issued by the Company to the Investor.</p>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The other short-term notes, related parties
were issued by the Company during 2019, and as of March 31, 2020 and December 31, 2019 consist of five loans, totaling $1,635,000,
made to the Company by Horne Management, LLC, controlled by Chief Executive Officer, William E. Horne. These were advanced for
working capital purposes and had the terms as indicated below. The loans bear interest ranging from 5.5% to 12%, in some cases
increasing to 15% if not paid by the respective maturity date ranging from March 26, 2020 to May 13, 2020. Some of these loans
provided for the issuance of warrants at 114% warrant coverage if the loan was not repaid within two months. None of these loans
have been repaid and 840,000 warrants have been issued at an exercise price of $0.75 per share. On April 23, 2020, Horne Management,
LLC agreed to convert the related notes plus accrued interest into (i) 4,368,278 shares of common stock of the Company and (ii)
a ten-year warrant to purchase up to an equivalent number of shares of the Company’s common stock with such conversion to
be effective as of April 17, 2020. This warrant will have an exercise price equal to the price per share at which securities are
offered to investors for purchase at the Qualified Financing, which such price has not yet been established, and is exercisable
beginning on the day immediately following the earlier to occur of (x) the closing of the Qualified Financing and (y) November
1, 2020. If the Qualified Financing does not occur on or prior to October 31, 2020, the exercise price of the warrant will be equal
to the price per share obtained by dividing $3,000,000 by the number of fully diluted shares of the Company outstanding on October
31, 2020.</p>
<p style="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of March 31, 2020, the Company had cash
on hand of $122,400. Cash on hand at May 15, 2020 was approximately $3,117,000. The Company’s cash is insufficient to fund
its operations over the next year and the Company will need to raise additional capital through debt or equity offerings to continue
operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">There can be no assurance that the Company
will be able to raise additional funds or that the terms and conditions of any future financings will be workable or acceptable
to the Company or its shareholders. In the event the Company is unable to fund its operations from existing cash on hand, operating
cash flows, additional borrowings or raising equity capital, the Company may be forced to reduce expenses or discontinue operations.
The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded
asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue
as a going concern.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
2 - Liquidity, Going Concern and Management’s Plans</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company incurred net losses of approximately
$29,808,000 and $4,394,000 for the years ending December 31, 2019 and 2018, respectively. The Company has historically incurred
losses from operations and expects to continue to generate negative cash flows as the Company’s revenue activities are suspended
and as the Company implements its business plan. The consolidated financial statements are prepared using accounting principles
generally accepted in the United States (“U.S. GAAP”) as applicable to a going concern, which contemplates the realization
of assets and liquidation of liabilities in the normal course of business.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Biosciences division will incur losses
until sufficient revenue is attained utilizing the infusion of capital resources to expand marketing and sales initiatives along
with the development of a L-CYTE-01 protocol and taking that protocol through the FDA process.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The recent coronavirus outbreak (“COVID-19”)
has adversely affected the Company’s financial condition and results of operations. The impact of the outbreak of COVID-19
on the businesses and the economy in the U.S. and the rest of the world is, and is expected to continue to be, significant. The
extent to which the COVID-19 outbreak will impact business and the economy is highly uncertain and cannot be predicted. Accordingly,
the Company cannot predict the extent to which its financial condition and results of operation will be affected. The Company recently
has taken steps to protect its vulnerable patient base (elderly patients suffering from chronic lung disease) by cancelling all
treatments effective March 23, 2020 through at least the end of July. This decision has put significant financial strain on the
Company. The Company made the decision in late March, to layoff approximately 40% of its employee base, including corporate and
clinical employees and to cease operations at the LHI clinics in Tampa, Scottsdale, Pittsburgh, and Dallas. The Company will reevaluate
when operations will recommence at these clinics as more information about COVID-19 becomes available.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company believes these expense reductions
are necessary during the unexpected COVID-19 pandemic. Due to COVID-19, the Company is not expecting to be able to generate revenue
until, at the earliest, August 2020. The Company has contacted its patients that are scheduled to come in for treatment, both first
time patients and recurring patients, and have rescheduled these patients to August 2020. There is no guarantee that the Company
will be able to treat patients as soon as August 2020; as such, the Company cannot estimate when it will be safe to treat patients
and generate revenue. The Company’s fourth quarter 2019 revenue was approximately $1.8 million. The Company expects that
the first quarter of 2020 will be substantially less than the fourth quarter of 2019, and future quarters’ revenue is dependent
on the timing of being able to treat patients again. The Company will continue to focus on its goal of taking the L-CYTE-01 protocol
to the FDA for treatment of chronic lung diseases. The Company is currently evaluating if its protocol has the potential to help
people affected by COVID-19, but more research will need to be completed before a definitive conclusion can be reached.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">With the Company’s revenue-generating
activities suspended, the Company will need to raise cash from debt and equity offerings to continue with its efforts to take the
L-CYTE-01 protocol to the FDA for treatment of chronic lung diseases. There can be no assurance that the Company will be successful
in doing so.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On March 27, 2020 and April 9, 2020, the Company
issued a demand note (the “Note”), each one in the principal amount of $500,000 to FWHC Bridge, LLC (the “Investor”)
for a total of $1,000,000 in exchange for loans in such amount to cover working capital needs. Each Note bears simple interest
at a rate of 8% per annum. The Investor is an affiliate of a pre-existing shareholder of the Company having been the lead investor
in the Company’s recent Series D Convertible Preferred Stock Offering.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 17, 2020 and in subsequent closings
occurring after April 17, 2020, the Company entered into a Secured Convertible Note and Warrant Purchase Agreement (the “April
SPA”) with investors (the “Purchasers”) pursuant to which the Company received an aggregate of $2,835,195 in
gross proceeds through the sale to the Purchasers of Secured Convertible Promissory Notes (the “April Secured Notes”)
and warrants (the “April Warrants”) to purchase shares of common stock of the Company (the “April Offering”).
After taking into account the subsequent closings occurring after April 17, 2020, an aggregate of thirty-three (33) Purchasers
participated in the April Offering by purchasing April Secured Notes and April Warrants. The proceeds of the April Offering will
be used for working capital and general corporate purposes. As part of the April Offering, the Notes previously issued by the Company
to the Investor on March 27, 2020 and April 9, 2020 were amended and superseded by an April Secured Note in the amount of $1,000,000
issued to the Investor. For further discussion of the April SPA, refer to Note 2 - “Liquidity, Going Concern and Management’s
Plans” and Note 16 - “Subsequent Events” to the consolidated financial statements in the Company’s Annual
Report on Form 10-K for year ended December 31, 2019 as amended on Form 10-K/A. Additionally, in connection with the April Offering,
the Company entered into an amendment with the Investor with respect to the outstanding 12% Senior Secured Convertible Note due
September 30, 2020, which was originally issued in 2018 and assumed in the Merger and which was purchased by the Investor from
its original holder, George Hawes, on March 27, 2020 (the “Hawes Note”). The Hawes Notes had a principal amount of
$424,615 as of March 31, 2020 and December 31, 2019. The amendment to the Hawes Note among other things, eliminates the requirement
that the Company make monthly payments of accrued interest. The Hawes Note is expected to convert into shares of preferred stock
of the Company offered for purchase at the Qualified Financing at the closing of the Qualified Financing.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As part of the April Offering, the holders
of certain existing warrants issued by the Company which contained anti-dilution price protection entered into agreements terminating
all anti-dilution price protection in their warrants. The Company intends to implement a one-time reduction of the exercise price
of such warrants to be equal to the price per share at which shares of preferred stock are offered for purchase at the Qualified
Financing once that price has been established.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Debt
and Other Obligations</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The short-term notes, issued by the Company
during 2019, as of March 31, 2020 and December 31, 2019 consist of five loans, totaling $1,635,000, made to the Company by Horne
Management, LLC, controlled by Chief Executive Officer, William E. Horne. These were advanced for working capital purposes and
had the terms as indicated below. The loans bear interest ranging from 5.5% to 12%, in some cases increasing to 15% if not paid
by the respective maturity date ranging from March 26, 2020 to May 13, 2020. Some of these loans provided for the issuance of warrants
at 114% warrant coverage if the loan was not repaid within two months. None of these loans have been repaid and 840,000 warrants
have been issued at an exercise price of $0.75 per share. On April 17, 2020, Horne Management, LLC agreed to convert the related
notes plus accrued interest into (i) 4,368,278 shares of common stock of the Company and (ii) a ten-year warrant to purchase up
to an equivalent number of shares of the Company’s common stock. This warrant will have an exercise price equal to the price
per share at which securities are offered to investors for purchase at the Qualified Financing, which such price has not yet been
established, and is exercisable beginning on the day immediately following the earlier to occur of (x) the closing of the Qualified
Financing and (y) November 1, 2020. If the Qualified Financing does not occur on or prior to October 31, 2020, the exercise price
of the warrant will be equal to the price per share obtained by dividing $3,000,000 by the number of fully diluted shares of the
Company outstanding on October 31, 2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The proceeds of the April Offering will be
used for working capital and general corporate purposes. The April Secured Notes bear interest at 12% per annum and have a maturity
date of October 31, 2020. The April Secured Notes are secured by all of the Company’s assets pursuant to a security agreement
and an intellectual Property Security Agreement which are included as Exhibits to this Annual report on Form 10-K. The conversion
price of the April Secured Notes shall be equal to the lesser of (i) the price per share paid by an investor, in the Qualified
Financing (as defined below) for such new securities and (ii) the price per share obtained by dividing (x) $3,000,000 by the number
of fully diluted shares outstanding immediately prior to the Qualified Financing. Qualified Financing is defined as an offering
of preferred stock of at least $3.6 million, exclusive of the conversion of any April Secured Note or the Backstop Commitment (as
defined below), at a price of at least $0.01279 per share. The obligations on the April Secured Notes are guaranteed by each of
the Company’s subsidiaries. FWHC Bridge, LLC, which is an affiliate of FWHC, who has acted as our lead investor in the last
several financing transactions and was the lender of the $1,000,000 loaned to the Company in March and April 2020, was the lead
investor in the April Offering purchasing $1,535,570 of April Secured Notes. YPH Holdings, LLC, which is an affiliate of Michael
Yurkowsky, who is a Director of the Company, purchased $25,000 of April Secured Notes on the same terms as all other investors.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Each Purchaser received a warrant to purchase
100% of the aggregate number of shares of common stock into which such Purchaser’s April Secured Note may ultimately be converted,
except that the holders of the Notes issued in March and April in the total amount of $1,000,000 received warrants to purchase
up to 200% of the aggregate number of shares of Common stock into which such Note may ultimately be converted The April Warrants
have an exercise price equal to the purchase price in the Qualified Offering.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The April SPA provides a commitment on the
part of each Purchaser to agree to invest an identical amount (as purchased in the April Offering) in the Qualified Offering as
a backstop commitment (the “Backstop Commitment”). The Qualified Offering is contemplated to be made in the form of
a rights offering to holders of all of the Company’s common stock. Accordingly, in the event that any stockholders do not
participate in the Qualified Offering, their purchase would be filled by the Purchasers on a pro rata basis. In the event that
any Purchaser fails to fulfil its Backstop Commitment then the April Warrants issued to such Purchaser in the April Offering will
be cancelled.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In connection with the April Offering, the
Company’s CEO Bill Horne entered into an amendment letter to his employment agreement which provides that his salary will
be reduced to $0 per month; provided that on the date that the Company receives FDA approval to commence clinical trials for its
products, Mr. Horne’s salary will be increased to a total of $18,750 per month (i.e. $225,000 per annum). Mr. Horne also
agreed to subordinate the promissory notes owed to him by the Company to the April Secured Notes.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2019, the Company had cash
on hand of $1,424,096. Cash on hand at April 13, 2020 was approximately $585,000. The Company’s cash is insufficient to fund
its operations in the near-term and the Company will need to raise additional capital through debt or equity offerings to continue
operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">There can be no assurance that the Company
will be able to raise additional funds or that the terms and conditions of any future financings will be workable or acceptable
to the Company or its shareholders. In the event the Company is unable to fund its operations from existing cash on hand, operating
cash flows, additional borrowings or raising equity capital, the Company may be forced to reduce our expenses, or discontinue
operations. The consolidated financial statements do not include any adjustments relating to the recoverability and classification
of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable
to continue as a going concern.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>N<font style="font-variant: small-caps">ote
15 - Subsequent Events</font></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 9, 2020, in exchange for an additional
loan of $500,000 made by the Investor to the Company to further cover the Company’s working capital needs, the Company amended
and restated the Note to reflect a new principal amount of $1,000,000 (the “A&R Note”). The A&R Note bears
simple interest at a rate of 12% per annum. The Investor is an affiliate of FWHC Holdings, LLC, a pre-existing shareholder of the
Company, which served as lead investor in the Company’s recent Series D Convertible Preferred Stock Offering. As discussed
further below in “Note Purchase Agreement”, this A&R Note was further amended and superseded by an April Secured
Note in the amount of $1,000,000 issued by the Company to the Investor.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Note
Purchase Agreement</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 17, 2020, and in subsequent April
closings, the Company entered into a Secured Convertible Note and Warrant Purchase Agreement (the “April SPA”) with
thirty three investors (the “Purchasers”) pursuant to which the Company received an aggregate of $2,835,195 in gross
proceeds through the sale to the Purchasers of Secured Convertible Promissory Notes (the “April Secured Notes”) and
warrants (the “April Warrants”) to purchase shares of common stock of the Company (the “April Offering”).
The proceeds of the April Offering will be used for working capital and general corporate purposes. The April Offering resulted
in the issuance of April Secured Notes to Purchasers in an aggregate principal amount of $3,835,195. This sum included the issuance
by the Company to the Investor of an April Secured Note in the amount of $1,000,000 to amend and supersede the A&R Note previously
issued by the Company to the Investor on April 9, 2020. Additionally, in connection with the April Offering, the Company entered
into an amendment with the Investor with respect to the outstanding 12% Senior Secured Convertible Note due September 30, 2020,
which was originally issued in 2018 and assumed in the Merger and which was purchased by the Investor from its original holder,
George Hawes, on March 27, 2020 (the “Hawes Note”). The Hawes Notes had a principal amount of $424,615 as of March
31, 2020 and December 31, 2019. The amendment to the Hawes Note among other things, eliminates the requirement that the Company
make monthly payments of accrued interest. The Hawes Note is expected to convert into shares of preferred stock of the Company
offered for purchase at the Qualified Financing at the closing of the Qualified Financing.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As part of the April Offering, the holders
of certain existing warrants issued by the Company which contained anti-dilution price protection entered into agreements terminating
all anti-dilution price protection in their warrants. The Company intends to implement a one-time reduction of the exercise price
of such warrants to be equal to the price per share at which shares of preferred stock are offered for purchase at the Qualified
Financing once that price has been established.</p>
<p style="font: 11pt Calibri, Helvetica, Sans-Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Debt
and Other Obligations</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 23, 2020, Horne Management, LLC agreed
to convert the short-term notes, related parties totaling $1,635,000 as of March 31, 2020 plus accrued interest into (i) 4,368,278
shares of common stock of the Company and (ii) a ten-year warrant to purchase up to an equivalent number of shares of the Company’s
common stock with such conversion to be effective as of April 17, 2020. This warrant will have an exercise price equal to the price
per share at which securities are offered to investors for purchase at the Qualified Financing, which such price has not yet been
established, and is exercisable beginning on the day immediately following the earlier to occur of (x) the closing of the Qualified
Financing and (y) November 1, 2020. If the Qualified Financing does not occur on or prior to October 31, 2020, the exercise price
of the warrant will be equal to the price per share obtained by dividing $3,000,000 by the number of fully diluted shares of the
Company outstanding on October 31, 2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The description of the April SPA, the April
Secured Note, the April Warrant, the Security Agreement, the Intellectual Property Security Agreement and the Amendment to William
Horne Employment Agreement and the Hawes Note, are each qualified in their entirety by the full text of such agreements which are
filed as Exhibits to the Annual Report on Form 10-K.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 29, 2020, the Company issued a promissory
note in the principal amount of $809,082 to the Bank of Tampa in connection with a loan in such amount made under the Payroll Protection
Program (“PPP Loan”). The PPP Loan bears interest at a rate of 1% per annum and is payable in eighteen monthly payments
of $45,533 commencing six months from the date of the note on November 29, 2020. While the note is dated April 29, 2020, the loan
was not formally approved and funded until May 7, 2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company can apply for loan forgiveness
in an amount equal to the sum of the following costs incurred by the Company:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">1) payroll costs;</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">2) any payment of interest on covered mortgage
obligations;</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">3) any payment on a covered rent obligation;
and</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">4) any covered utility payment</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The amount forgiven will be calculated (and
may be reduced) in accordance with the Paycheck Protection Program. Not more than 25% of the amount forgiven can be attributed
to non-payroll costs.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On May 7, 2020, William Horne, the Company’s
CEO and Chairman resigned as CEO effective when the Company finds a suitable replacement who has more FDA experience. Until such
successor is retained, Mr. Horne will remain as the CEO. Mr. Horne’s resignation does not go to his position as Chairman
of the Board or as a Director. The resignation was not as a result of any disagreement with the Company or its policies and practices.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has evaluated subsequent events
occurring through the date that the financial statements were available to be issued for events requiring recording or disclosure
in the March 31, 2020 consolidated financial statements.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>N<font style="font-variant: small-caps">ote
16 - Subsequent Events</font></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="background-color: white">COVID-19
has adversely affected the Company’s financial condition and results of operations. The impact of the COVID-19 outbreak on
the businesses and the economy in the U.S. and the rest of the world is, and is expected to continue to be, significant. The extent
to which COVID-19 outbreak will impact business and the economy is highly uncertain and cannot be predicted. Accordingly, the Company
cannot predict the extent to which its financial condition and results of operation will be affected. The Company recently has
taken steps to protect its vulnerable patient base (elderly patients suffering from chronic lung disease) by cancelling all treatments
effective March 23, 2020 through at least the end of July. This decision has put significant financial strain on the Company. The
Company made the decision in late March, to layoff approximately 40% of its employee base, including corporate and clinical employees
and to cease operations at the LHI clinics in Tampa, Scottsdale, Pittsburgh, and Dallas. The Company will reevaluate when operations
will recommence at these clinics as more information about COVID-19 becomes available.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="background-color: white">The Company
believes these expense reductions are necessary during the unexpected COVID-19 pandemic. Due to COVID-19, the Company is not expecting
to be able to generate revenue until, at the earliest, August 2020. The Company has contacted its patients that are scheduled to
come in for treatment, both first time patients and recurring patients, and have rescheduled these patients to August 2020. There
is no guarantee that the Company will be able to treat patients as soon as August 2020; as such, the Company cannot estimate when
it will be safe to treat patients and generate revenue. The Company’s fourth quarter 2019 revenue was approximately $1.8
million. The Company expects that the first quarter will be substantially less than the fourth quarter 2019 and future quarters’
revenue is dependent on the timing for being able to treat patients again. The Company will continue to focus on its goal of taking
the L-CYTE-01 protocol to the FDA for treatment of chronic lung diseases. The Company is currently evaluating if its protocol has
the potential to help people affected by COVID-19, but more research will need to be completed before a definitive conclusion can
be reached.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="background-color: white">With
the Company’s revenue-generating activities suspended, the Company will need to raise cash from debt and equity offerings
to continue with its efforts to take the L-CYTE-01 protocol to the FDA for treatment of chronic lung diseases. There can be no
assurance that the Company will be successful in doing so.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In January 2020, the Company closed on an additional
$100,000 in the Series D SPA.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On March 27, 2020 and April 9, 2020, the Company
issued a Note, each one in the principal amount of $500,000 to the Investor for a total of $1,000,000 in exchange for loans in
such amount to cover working capital needs. Each Note bears simple interest at a rate of 8% per annum. The Investor is an affiliate
of a pre-existing shareholder of the Company having been the lead investor in the Company’s recent Series D Convertible Preferred
Stock Offering.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 17, 2020 and in subsequent closings
occurring after April 17, 2020, the Company entered into a Secured Convertible Note and Warrant Purchase Agreement (the “April
SPA”) with investors (the “Purchasers”) pursuant to which the Company received an aggregate of $2,835,195 in
gross proceeds through the sale to the Purchasers of Secured Convertible Promissory Notes (the “April Secured Notes”)
and warrants (the “April Warrants”) to purchase shares of common stock of the Company (the “April Offering”).
After taking into account the subsequent closings occurring after April 17, 2020, an aggregate of thirty-three Purchasers participated
in the April Offering by purchasing April Secured Notes and April Warrants. The proceeds of the April Offering will be used for
working capital and general corporate purposes. As part of the April Offering, the Notes previously issued by the Company to the
Investor on March 27, 2020 and April 9, 2020 were amended and superseded by an April Secured Note in the amount of $1,000,000 issued
to the Investor. For further discussion of the April SPA, refer to Note 2 - “Liquidity, Going Concern and Management’s
Plans” and Note 16 - “Subsequent Events” to the consolidated financial statements in the Company’s Annual
Report on Form 10-K for year ended December 31, 2019 as amended on Form 10-K/A. Additionally, in connection with the April Offering,
the Company entered into an amendment with the Investor with respect to the outstanding 12% Senior Secured Convertible Note due
September 30, 2020, which was originally issued in 2018 and assumed in the Merger and which was purchased by the Investor from
its original holder, George Hawes, on March 27, 2020 (the “Hawes Note”). The Hawes Notes had a principal amount of
$424,615 as of March 31, 2020 and December 31, 2019. The amendment to the Hawes Note among other things, eliminates the requirement
that the Company make monthly payments of accrued interest. The Hawes Note is expected to convert into shares of preferred stock
of the Company offered for purchase at the Qualified Financing at the closing of the Qualified Financing.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As part of the April Offering, the holders
of certain existing warrants issued by the Company which contained anti-dilution price protection entered into agreements terminating
all anti-dilution price protection in their warrants. The Company intends to implement a one-time reduction of the exercise price
of such warrants to be equal to the price per share at which shares of preferred stock are offered for purchase at the Qualified
Financing once that price has been established.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Debt and Other Obligations</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The short-term notes, issued by the Company
during 2019, as of March 31, 2020 and December 31, 2019 consist of five loans, totaling $1,635,000, made to the Company by Horne
Management, LLC, controlled by Chief Executive Officer, William E. Horne. These were advanced for working capital purposes and
had the terms as indicated below. The loans bear interest ranging from 5.5% to 12%, in some cases increasing to 15% if not paid
by the respective maturity date ranging from March 26, 2020 to May 13, 2020. Some of these loans provided for the issuance of warrants
at 114% warrant coverage if the loan was not repaid within two months. None of these loans have been repaid and 840,000 warrants
have been issued at an exercise price of $0.75 per share. On April 17, 2020, Horne Management, LLC agreed to convert the related
notes plus accrued interest into (i) 4,368,278 shares of common stock of the Company and (ii) a ten-year warrant to purchase up
to an equivalent number of shares of the Company’s common stock. This warrant will have an exercise price equal to the price
per share at which securities are offered to investors for purchase at the Qualified Financing, which such price has not yet been
established, and is exercisable beginning on the day immediately following the earlier to occur of (x) the closing of the Qualified
Financing and (y) November 1, 2020. If the Qualified Financing does not occur on or prior to October 31, 2020, the exercise price
of the warrant will be equal to the price per share obtained by dividing $3,000,000 by the number of fully diluted shares of the
Company outstanding on October 31, 2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The proceeds of the April Offering will be
used for working capital and general corporate purposes. The April Offering resulted in the issuance of an aggregate of $2,812,445
in Secured Convertible Promissory Notes (the “April Secured Notes’). The April Secured Notes bear interest at 12% per
annum and have a maturity date of October 31, 2020. The April Secured Notes are secured by all of the Company’s assets pursuant
to a security agreement and an intellectual Property Security Agreement which are included as Exhibits to this Annual report on
Form 10-K. The conversion price of the April Secured Notes shall be equal to the lesser of (i) the price per share paid by an investor,
in the Qualified Financing (as defined below) for such new securities and (ii) the price per share obtained by dividing (x) $3,000,000
by the number of fully diluted shares outstanding immediately prior to the Qualified Financing. Qualified Financing is defined
as an offering of preferred stock of at least $3.6 million, exclusive of the conversion of any April Secured Note or the Backstop
Commitment (as defined below), at a price of at least $0.01279 per share. The obligations on the April Secured Notes are guaranteed
by each of the Company’s subsidiaries. FWHC Bridge, LLC, which is an affiliate of FWHC, who has acted as our lead investor
in the last several financing transactions and was the lender of the $1,000,000 loaned to the Company in March and April, was the
lead investor in the April Offering purchasing $1,535,570 of April Secured Notes. YPH Holdings, LLC, which is an affiliate of Michael
Yurkowsky, who is a Director of the Company, purchased $25,000 of April Secured Notes on the same terms as all other investors</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Each Purchaser received a warrant to purchase
100% of the aggregate number of shares of common stock into which such Purchaser’s April Secured Note may ultimately be converted,
except that the holders of the Notes issued in March and April in the total amount of $1,000,000 received warrants to purchase
up to 200% of the aggregate number of shares of Common stock into which such Note may ultimately be converted The April Warrants
have an exercise price equal to the purchase price in the Qualified Offering.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The April SPA provides a commitment on the
part of each Purchaser to agree to invest an identical amount (as purchased in the April Offering) in the Qualified Offering as
a backstop commitment (the “Backstop Commitment”). The Qualified Offering is contemplated to be made in the form of
a rights offering to holders of all of the Company’s common stock. Accordingly, in the event that any stockholders do not
participate in the Qualified Offering, their purchase would be filled by the Purchasers on a pro rata basis. In the event that
any Purchaser fails to fulfil its Backstop Commitment then the April Warrants issued to such Purchaser in the April Offering will
be cancelled.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In connection with the April Offering, the
Company’s CEO Bill Horne entered into an amendment letter to his employment agreement which provides that his salary will
be reduced to $0 per month; provided that on the date that the Company receives FDA approval to commence clinical trials for its
products, Mr. Horne’s salary will be increased to a total of $18,750 per month (i.e. $225,000 per annum). Mr. Horne also
agreed to subordinate the promissory notes owed to him by the Company to the April Secured Notes.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The description of the April SPA, the April
Secured Note, the April Warrant, the Security Agreement, the Intellectual Property Security Agreement and the Amendment to William
Horne Employment Agreement and the Hawes Note, are each qualified in their entirety by the full text of such agreements which
are filed as Exhibits to this Annual Report on Form 10-K as amended on Form 10-K/A</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Property and equipment, net, consists of the
following:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Useful Life</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">March 31, 2020</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 45%"><font style="font-size: 10pt">Furniture and fixtures</font></td>
<td style="width: 1%"> </td>
<td style="width: 16%; text-align: center"><font style="font-size: 10pt">5-7 years</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 16%; text-align: right"><font style="font-size: 10pt">231,222</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 16%; text-align: right"><font style="font-size: 10pt">231,222</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Computers and software</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 10pt">3-7 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">244,039</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">244,039</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Leasehold improvements</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"><font style="font-size: 10pt">15 years</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">157,107</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">157,107</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">632,368</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">632,368</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Less accumulated depreciation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(434,772</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(412,665</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt"><b>Total</b></font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt; text-align: center"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">197,596</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">219,703</font></td>
<td style="padding-bottom: 2.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Property and equipment, net, consists of the
following:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Useful Life</font></td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">December 31, 2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">December 31, 2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 46%"><font style="font: 10pt Times New Roman, Times, Serif">Furniture and fixtures</font></td>
<td style="width: 2%"> </td>
<td style="width: 14%; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">5-7 years</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 16%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">231,222</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">149,285</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Computers and software</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3-7 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">244,039</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">278,234</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Leasehold improvements</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">15 years</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">157,107</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">156,133</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">632,368</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">583,652</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Less accumulated depreciation</font></td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(412,665</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(316,736</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif"><b>Total</b></font></td>
<td> </td>
<td style="text-align: center"> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">219,703</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">266,916</font></td>
<td> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following is a summary of stock option
activity for the quarters ending March 31, 2019 and March 31, 2020:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Shares</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Term (Years)</b></p></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Outstanding at December 31, 2018</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 49%"><font style="font-size: 10pt">Assumed with the RMS merger transaction</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">557,282</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">2.78</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6.99</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Granted</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">250,000</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Expired</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(80,725</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">1.52</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Outstanding at March 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">726,557</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.95</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.74</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Exercisable at March 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">695,418</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.96</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.74</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Outstanding at December 31, 2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">425,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">1.38</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">7.71</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Granted</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Expired</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Outstanding and exercisable at March 31, 2020</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">425,000</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.38</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.46</font></td>
<td style="padding-bottom: 2.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following is a summary of stock option
activity for the year ending December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Shares</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Term (Years)</b></p></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Outstanding at December 31, 2018</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 43%"><font style="font: 10pt Times New Roman, Times, Serif">Assumed with the Merger</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"> </td>
<td style="width: 16%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">557,282</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.78</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">6.99</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Other activity since January 8, 2019:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Granted</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">250,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9.02</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Cancelled</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(382,282</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.86</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Outstanding at December 31, 2019</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">425,000</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.38</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7.71</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Exercisable at December 31, 2019</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">421,250</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.38</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7.71</font></td>
<td> </td></tr>
</table>
<p style="margin: 0pt"></p>
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<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A summary of the Company’s warrant issuance
activity and related information for the quarters ended March 31, 2020 and March 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Shares</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Contractual</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Life</b></p></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 49%"><font style="font-size: 10pt">Assumed as of the January 8, 2019 merger</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">12,108,743</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">1.38</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">2.60</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Issued</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">17,500,000</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">0.75</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">2.84</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Outstanding and exercisable at March 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">29,608,743</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.00</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">2.63</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Outstanding and exercisable at December 31, 2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">44,806,076</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.78</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">4.59</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Issued</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">513,567</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">0.75</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">6.13</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Outstanding and exercisable at March 31, 2020</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">45,319,643</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">0.78</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">4.61</font></td>
<td style="padding-bottom: 2.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A summary of the Company’s warrant issuance
activity and related information for the year ended December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Shares</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Contractual</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Life</b></p></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 55%"><font style="font: 10pt Times New Roman, Times, Serif">Assumed as of the January 8, 2019 merger</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"> </td>
<td style="width: 12%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">12,108,743</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 11%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.38</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 11%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.53</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Exchanged</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(1,007,813</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expired</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(2,183,478</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.73</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Issued</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">35,888,624</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.73</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5.36</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Outstanding and exercisable at 12/31/19</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">44,806,076</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.78</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4.59</font></td>
<td> </td></tr>
</table>
<p style="margin: 0pt"></p>
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38288
36042
189035
462856
357689
475000
402876
475000
713000
221710
713000
6670861
6521436
6888820
-370132
-370132
370000
-370132
370000
-33805
2000000
33805
33661
39772
33661
33661
17263889
17263889
500000
750000
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
4 – Business Acquisition</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 8, 2019, MedoveX completed its business
combination with RMS under which MedoveX purchased certain assets and assumed certain liabilities of RMS, otherwise referred to
as the Merger. Pursuant to the terms of the APA, MedoveX issued to the shareholders of RMS 33,661 shares plus 6,111 additional
Exchange Shares (based on closing the sale of $2,000,000 of new securities) for a total of 39,772 shares of Series C Preferred
Stock where each share of Series C Preferred stock automatically converted into 1,000 shares of common stock and represent approximately
55% of the outstanding voting shares of the Company.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Under the terms of the APA, the Company issued
additional “Exchange Shares” to the shareholders of RMS to maintain the 55% ownership and not be diluted by the sale
of convertible securities (“New Shares Sold”) until MedoveX raised an additional $5,650,000 via the issuance of new
securities. On the date of closing the Company issued 6,111 additional Exchange Shares to RMS Shareholders as a result of the issuance
of additional securities, which are included in the 39,772 shares above. Subsequent to the closing of the purchase transaction,
an incremental 11,153 additional Exchange Shares were issued, for a total of 17,264 additional Exchange Shares. All additional
Exchange Shares have been issued to the shareholders of RMS and these Series C Preferred shares converted to 17,263,889 shares
of common stock; no additional equity will be issued to RMS.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Because RMS shareholders owned approximately
55% of the voting stock of MedoveX after the transaction, RMS was deemed to be the acquiring company for accounting purposes (the
“Acquirer”) and the transaction is accounted for as a reverse acquisition under the acquisition method of accounting
for business combinations in accordance with U.S. GAAP. The assets acquired and the liabilities assumed of RMS included as part
of the purchase transaction are recorded at historical cost. Accordingly, the assets and liabilities of MedoveX (the “Acquiree”)
are recorded as of the Merger closing date at their estimated fair values.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Purchase
Price Allocation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The purchase price for the acquisition of the
Acquiree has been allocated to the assets acquired and liabilities assumed based on their estimated fair values.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The acquisition-date fair value of the consideration
transferred is as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 82%"><font style="font-size: 10pt">Common shares issued and outstanding</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%; text-align: right"><font style="font-size: 10pt">24,717,270</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Common shares reserved for issuance upon conversion of the outstanding Series B Preferred Stock</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">2,312,500</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total Common shares</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">27,029,770</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Closing price per share of MedoveX Common stock on January 8, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">10,811,908</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Fair value of outstanding warrants and options</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2,220,000</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Cash consideration to RMS</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(350,000</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total consideration</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">12,681,908</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Prior to the transaction, MedoveX had 24,500,000
shares of common stock outstanding at a market capitalization of $9,800,000. The estimated fair value of the net assets of MedoveX
was $8,400,000 as of January 8, 2019. Measuring the fair value of the net assets to be received by RMS was readily determinable
based upon the underlying nature of the net assets. The fair value of the MedoveX common stock was above the fair value of its
net assets. The MedoveX net asset value was primarily comprised of definite-lived intangibles as of the closing and the RMS interest
in the merger is significantly related to obtaining access to the public market. Therefore, the fair value of the MedoveX stock
price and market capitalization as of the closing date is considered to be the best indicator of the fair value and, therefore,
the purchase price consideration.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following table summarizes the fair values
of the assets acquired and liabilities assumed at the date of acquisition on January 8, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 82%"><font style="font-size: 10pt">Cash</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 15%; text-align: right"><font style="font-size: 10pt">(302,710</font></td>
<td style="width: 1%"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Accounts receivable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">145,757</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Inventory</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">131,455</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Prepaid expenses</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">46,153</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Property and equipment</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">30,393</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Other</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2,751</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Intangibles</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">3,680,000</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Goodwill</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">12,564,401</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total assets acquired</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">16,298,200</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Accounts payable and other accrued liabilities</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,645,399</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Derivative liability</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,215,677</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Interest-bearing liabilities and other</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">755,216</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Net assets acquired</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">12,681,908</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Intangible assets are recorded as definite-lived
assets and amortized over the estimated period of economic benefit. Intangible assets represent the fair value of patents and related
proprietary technology for the DenerveX System. During the fourth quarter of 2019 the Company recorded an impairment charge of
$2,944,000 related to the carrying value of its intangible assets.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill is calculated as the difference between
the acquisition-date fair value of the consideration transferred and the fair values of the assets acquired, and liabilities assumed.
Goodwill is not expected to be deductible for income tax purposes. Goodwill is recorded as an indefinite-lived asset and is not
amortized but tested for impairment on an annual basis or when indications of impairment exist. During the fourth quarter of 2019
the Company recorded an impairment charge of approximately $12,564,000 related to the carrying value of goodwill.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The derivative liability relates to the liability
associated with warrants issued with the securities purchase agreements executed in May 2018, which liability was assumed in the
Merger (see Note 12).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Total interest-bearing liabilities and other
liabilities assumed are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 82%"><font style="font-size: 10pt">Notes payable</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 15%; text-align: right"><font style="font-size: 10pt">99,017</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Short-term convertible notes payable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">598,119</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Dividend payable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">57,813</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Deferred rent</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">267</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Total interest-bearing and other liabilities</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">755,216</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For further discussion of the notes payable
and short-term convertible notes payable, refer to Note 11-“ Short-term Debt “ to these interim financial statements.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
4– Business Acquisition</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 8, 2019, MedoveX completed its business
combination with RMS under which MedoveX purchased certain assets and assumed certain liabilities of RMS, otherwise referred to
as the Merger. Pursuant to the terms of the APA, MedoveX issued to the shareholders of RMS 33,661 shares plus 6,111 additional
Exchange Shares (based on closing the sale of $2 million of new securities) for a total of 39,772 shares of Series C Preferred
Stock where each share of Series C Preferred stock automatically converted into 1,000 shares of common stock and represent approximately
55% of the outstanding voting shares of the Company.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Under the terms of the APA, the Company issued
additional “Exchange Shares” to the shareholders of RMS to maintain the 55% ownership and not be diluted by the sale
of convertible securities (“New Shares Sold”) until MedoveX raised an additional $5.65 million via the issuance of
new securities. On the date of closing the Company issued 6,111 additional Exchange Shares to RMS Shareholders as a result of the
issuance of additional securities, which are included in the 39,772 shares above. Subsequent to the closing of the purchase transaction,
an incremental 11,153 additional Exchange Shares were issued, for a total of 17,264 additional Exchange Shares. All additional
Exchange Shares have been issued to the shareholders of RMS and these Series C Preferred shares converted to 17,263,889 shares
of common stock; no additional equity will be issued to RMS.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Because RMS shareholders owned approximately
55% of the voting stock of MedoveX after the transaction, RMS was deemed to be the acquiring company for accounting purposes (the
“Acquirer”) and the transaction is accounted for as a reverse acquisition under the acquisition method of accounting
for business combinations in accordance with U.S. GAAP. The assets acquired and the liabilities assumed of RMS included as part
of the purchase transaction are recorded at historical cost. Accordingly, the assets and liabilities of MedoveX (the “Acquiree”)
are recorded as of the Merger closing date at their estimated fair values.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Under the terms of the APA, MedoveX purchased
certain assets and assumed certain liabilities of RMS. The assets of RMS reported on the MedoveX consolidated balance sheet as
of December 31, 2018 that were excluded in the Merger on January 8, 2019 included the following: cash of approximately $70,000
convertible debt to a related party of approximately $4,300,000, interest payable of approximately $158,000, short-term notes,
related party of approximately $180,000, accounts payable of approximately $398,000 and other current liabilities of approximately
$285,000. Additionally, there were certain on-going litigation matters that were not assumed as part of the January 8, 2019 Merger.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Purchase
Price Allocation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The purchase price for the acquisition of the
Acquiree has been allocated to the assets acquired and liabilities assumed based on their estimated fair values.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The acquisition-date fair value of the consideration
transferred is as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 84%"><font style="font-size: 10pt">Common shares issued and outstanding</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 13%; text-align: right"><font style="font-size: 10pt">24,717,270</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Common shares reserved for issuance upon conversion of the outstanding Series B Preferred Stock</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">2,312,500</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total Common shares</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">27,029,770</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Closing price per share of MedoveX Common stock on January 8, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">10,811,908</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Fair value of outstanding warrants and options</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2,220,000</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Cash consideration to RMS</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(350,000</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total consideration</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">12,681,908</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Prior to the transaction, MedoveX had 24.5
million shares of common stock outstanding at a market capitalization of $9.8 million. The estimated fair value of the net assets
of MedoveX was $8.4 million as of January 8, 2019. Measuring the fair value of the net assets to be received by RMS was readily
determinable based upon the underlying nature of the net assets. The fair value of the MedoveX common stock is above the fair value
of its net assets. The MedoveX net asset value is primarily comprised of definite-lived intangibles as of the closing and the RMS
interest in the merger is significantly related to obtaining access to the public market. Therefore, the fair value of the MedoveX
stock price and market capitalization as of the closing date is considered to be the best indicator of the fair value and, therefore,
the estimated purchase price consideration.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following table summarizes the fair values
of the assets acquired and liabilities assumed at the date of acquisition on January 8, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 84%"><font style="font-size: 10pt">Cash</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 13%; text-align: right"><font style="font-size: 10pt">(302,710</font></td>
<td style="width: 1%"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Accounts receivable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">145,757</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Inventory</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">131,455</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Prepaid expenses</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">46,153</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Property and equipment</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">30,393</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Other</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2,751</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Intangibles</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">3,680,000</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Goodwill</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">12,564,401</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total assets acquired</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">16,298,200</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Accounts payable and other accrued liabilities</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,645,399</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Derivative liability</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,215,677</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Interest-bearing liabilities and other</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">755,216</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Net assets acquired</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">12,681,908</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Intangible assets are recorded as definite-lived
assets and amortized over the estimated period of economic benefit. Intangible assets represent the fair value of patents and related
proprietary technology for the DenerveX System. During the fourth quarter of 2019 the Company recorded an impairment charge of
$2,944,000 related to the carrying value of its intangible assets (see Note 3).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill is calculated as the difference between
the acquisition-date fair value of the consideration transferred and the fair values of the assets acquired and liabilities assumed.
Goodwill is not expected to be deductible for income tax purposes. Goodwill is recorded as an indefinite-lived asset and is not
amortized but tested for impairment on an annual basis or when indications of impairment exist. During the fourth quarter of 2019
the Company recorded an impairment charge of approximately $12,564,000 related to the carrying value of goodwill (see Note 3).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The derivative liability relates to the liability
associated with warrants issued with the securities purchase agreements executed in May 2018, which liability was assumed in the
Merger (see Note 12).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Total interest-bearing liabilities and other
liabilities assumed are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 84%"><font style="font-size: 10pt">Notes payable</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 13%; text-align: right"><font style="font-size: 10pt">99,017</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Short-term convertible notes payable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">598,119</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Dividend payable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">57,813</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Deferred rent</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">267</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Total interest-bearing and other liabilities</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">755,216</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Notes payable relate to promissory notes assumed
by Acquiree in a 2015 acquisition, which was later divested in 2016, with the assumed promissory notes being retained by Acquiree.
The Company finalized an eighteen-month extension on the notes extending the maturity date to March 1, 2021. Payments on both notes
are due in aggregate monthly installments of approximately $5,800 and carry an interest rate of 5%. The promissory notes had outstanding
balances of approximately $99,000 plus accrued interest of approximately $3,000 at January 8, 2019 (see Note 11) and promissory
notes had outstanding balances of $78,000 as of December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In the third quarter of 2018, convertible notes
were issued pursuant to a securities purchase agreement with select accredited investors, whereby the Acquiree offered up to 1,000,000
units (the “Units”) at a purchase price of $50,000 per Unit. Each Unit consisted of (i) a 12% senior secured convertible
note, initially convertible into shares of the Company’s common stock, par value $0.001 per share, at a conversion price
equal to the lesser of $0.40 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock
equivalents issued in future private placements of equity and/or debt securities completed by the Company following this offering
of Units, and (ii) a three-year warrant to purchase such number of shares of the Company’s common stock equal to one hundred
percent (100%) of the number of shares of common stock issuable upon conversion of the notes at $0.40. The warrants are exercisable
at a price equal to the lesser of $0.75 or ninety percent (90%) of the per share purchase price of any shares of common stock or
common stock equivalents issued in future private placements of the debt and/or equity securities completed by the Company following
the issuance of warrants. As a result of the price adjustment feature, the conversion price of the convertible notes was adjusted
to $0.36 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In the offering, the Acquiree sold an aggregate
of 15 Units and issued to investors an aggregate of $750,000 in principal amount of convertible notes and 1,875,000 warrants to
purchase common stock, resulting in total gross proceeds of $750,000 to the Company. If converted at $0.40 the convertible notes
sold in the offering are convertible into an aggregate of 1,875,000 shares of common stock. The Acquiree recorded the proceeds
from the notes and the accompanying warrants, which accrete over the period the notes are outstanding, on a relative fair value
basis of approximately $505,000 and $245,000, respectively. At acquisition date, the value of the notes was approximately $598,000.
Due to the notes maturing in 2019, the warrants have fully accreted as of December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The convertible notes had maturity dates between
August and September 2019 and were renegotiated or repaid during the third and fourth quarters of 2019 (see Note 11).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following schedule represents the amount
of revenue and net loss attributable to the MedoveX acquisition which have been included in the consolidated statements of operations
for the periods subsequent to the acquisition date:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="text-align: center"><font style="font-size: 10pt">For the Year Ended</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 82%"><font style="font-size: 10pt">Revenues</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 15%; text-align: right"><font style="font-size: 10pt">67,631</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Net loss attributable to MedoveX</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(4,754,680</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following unaudited pro forma financial
information represents the consolidated financial information as if the acquisition had been included in the consolidated results
beginning on the first day of the fiscal year prior to its acquisition date. The pro forma results have been calculated after adjusting
the results of the acquired entity to remove any intercompany transactions and transaction costs incurred and to reflect any additional
depreciation and amortization that would have been charged assuming the fair value adjustments to property and equipment and intangible
assets had been applied on the first day of the fiscal year prior to its acquisition date, together with the consequential tax
effects. The pro forma results do not reflect any cost savings, operating synergies, or revenue enhancements that the combined
entities may achieve as a result of the acquisition; the costs to combine the companies’ operations; or the costs necessary
to achieve these cost savings, operating synergies or revenue enhancements. The pro forma results do not necessarily reflect the
actual results of operations of the combined companies under the current ownership and operation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">For the Year Ended December 31, 2018</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">RMS</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">MedoveX</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Pro Forma</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 55%"><font style="font-size: 10pt">Revenues</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 12%; text-align: right"><font style="font-size: 10pt">7,883,115</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 12%; text-align: right"><font style="font-size: 10pt">818,211</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 12%; text-align: right"><font style="font-size: 10pt">8,701,326</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Net loss</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(4,394,149</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(4,908,644</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(9,302,793</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Net loss attributable to common shareholders</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(4,394,149</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(5,477,873</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(9,872,022</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Loss per share- basic and diluted</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(0.13</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(0.23</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(0.17</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
5 – Right-of-use Asset And Lease Liability </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 9, 2019, the Company adopted ASU
No. 2016-02 (as amended), and additional current liabilities of approximately $475,000 and long-term liabilities of approximately
$713,000 with corresponding ROU assets of approximately $1,167,000 were recognized, based on the present value of the remaining
minimum rental payments under the new leasing standards for existing operating leases.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The consolidated balance sheet at March 31,
2020 reflects current lease liabilities of approximately $403,000 and long-term liabilities of $222,000, with corresponding ROU
assets of $607,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The audited consolidated balance sheet at December
31, 2019 reflects current lease liabilities of approximately $454,000 and long-term liabilities of $302,000, with corresponding
ROU assets of $738,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The components of lease expense for the three
months ended March 31, 2020 and 2019, respectively, are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Three months ended <br />
March 31,</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2020</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 62%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating lease expense</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 16%; text-align: right"><font style="font-size: 10pt">150,564</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 16%; text-align: right"><font style="font-size: 10pt">136,943</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td></tr>
<tr>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Cash paid for amounts included in the measurement
of lease liabilities for the three months ended March 31, 2020 and 2019, respectively, are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Three months ended <br />
March 31,</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2020</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 62%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating cash flows from operating leases</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 16%; text-align: right"><font style="font-size: 10pt">150,564</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 16%; text-align: right"><font style="font-size: 10pt">136,943</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td></tr>
<tr>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Supplemental balance sheet and other information
related to operating leases are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">March 31, 2020</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 58%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating leases right-of-use assets</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font-size: 10pt">606,897</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font-size: 10pt">738,453</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Lease liability, current portion</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">402,876</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">453,734</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Lease liability, net of current portion</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">221,710</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">302,175</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total operating lease liabilities</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">624,586</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">755,909</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Weighted average remaining lease term</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">2.16 years</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">2.25 years</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Weighted average discount rate</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.75</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">%</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.75</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">%</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Future maturities of operating lease liabilities
as of March 31, 2020 are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Operating leases</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 73%"><font style="font-size: 10pt">Remainder of 2020</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 24%; text-align: right"><font style="font-size: 10pt">353,601</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">2021</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">154,559</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">2022</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">102,891</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">2023</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">69,333</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total lease payments</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">680,384</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Less interest</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(55,798</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">624,586</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Operating lease expense and cash flows from
operating leases for the three months ended March 31, 2020 and 2019, totaled approximately $150,000 and $137,000, respectively,
and are included in the “Other general and administrative” section of the consolidated statement of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company leases corporate office space
in Tampa, FL and Atlanta, GA. The Company also leases medical clinic space in Tampa, FL, Nashville, TN, Scottsdale, AZ, Pittsburgh,
PA, and Dallas, TX. The leasing arrangements contain various renewal options that are adjusted for increases in the consumer price
index or agreed upon rates. Each location has its own expiration date ranging from April 30, 2020 to August 31, 2023. In May 2020,
due to COVID-19, the Company entered into a three-month extension for the lease that expired on April 30, 2020.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
5 – Right-of-use Asset And Lease Liability</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Upon adoption of ASU No. 2016-02 (as amended)
(See Note 3), additional current liabilities of approximately $475,000 and long-term liabilities of approximately $713,000 with
corresponding ROU assets of approximately $1,167,000 were recognized, based on the present value of the remaining minimum rental
payments under the new leasing standards for existing operating leases.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The audited consolidated balance sheet at December
31, 2019 reflects current lease liabilities of approximately $454,000 and long-term liabilities of $302,000, with corresponding
ROU assets of $738,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The components of lease expense for the years
ended December 31, 2019 and 2018, respectively, are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Year ended December 31,</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2018</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 58%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating lease expense</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font-size: 10pt">579,770</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font-size: 10pt">533,035</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td></tr>
<tr>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Cash paid for amounts included in the measurement
of lease liabilities for the years ended December 31, 2019 and 2018, respectively, are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Year ended December 31,</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2018</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 58%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating cash flows from operating leases (1)</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font-size: 10pt">579,770</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font-size: 10pt">-</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td></tr>
<tr>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Supplemental balance sheet and other information
related to operating leases are as follows (1):</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Operating leases:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 76%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating leases right-of-use assets</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 21%; text-align: right"><font style="font-size: 10pt">738,453</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Lease liability, current</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">453,734</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Lease liability, net of current portion</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">302,175</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total operating lease liabilities</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">755,909</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Weighted average remaining lease term</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">2.2 years</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Weighted average discount rate</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.75%</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 24px; text-align: justify"> </td>
<td style="width: 24px; text-align: justify"><font style="font-size: 10pt">(1)</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">There is no comparable information for operating leases at or for the year ended December 31, 2018 since the Company adopted ASU No. 2016-02 on January 1, 2019 and elected to recognize operating lease right-of-use assets and operating lease liabilities at the adoption date.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify; text-indent: -0.25in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Maturities of operating lease liabilities as
of December 31, 2019 are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Operating leases</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td><font style="font-size: 10pt">Operating leases:</font></td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 76%"><font style="font-size: 10pt">Due in one year or less</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 21%; text-align: right"><font style="font-size: 10pt">492,141</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Due after one year through two years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">154,559</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Due after two years through three years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">102,891</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Due after three years through four years</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">69,333</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total lease payments</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">818,924</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Less interest</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(63,015</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">755,909</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Operating lease expense and cash flows from
operating leases for year ended December 31, 2019 totaled approximately $580,000 and are included in the “Other general and
administrative” section of the audited consolidated statement of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company leases corporate office space
in Tampa, FL and Atlanta, GA. The Company also leases medical clinic space in Tampa, FL, Nashville, TN, Scottsdale, AZ, Pittsburgh,
PA, and Dallas, TX. The leasing arrangements contain various renewal options that are adjusted for increases in the consumer price
index or agreed upon rates. Each location has its own expiration date ranging from April 30, 2020 to August 31, 2023.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
7 - Intangible Assets And Goodwill</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s intangible assets are patents
and related proprietary technology for the DenerveX System for which an impairment charge was made in the fourth quarter of 2019
writing off this asset as of December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the three months ended March 31, 2020 and
2019, total amortization expense related to acquisition-related intangible assets was $0 and $184,000, respectively, and is included
in operating expense in the accompanying consolidated statement of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill represents the excess of purchase
price over fair value of net identified tangible and intangible assets and liabilities acquired in the Merger. As of December
31, 2019, the Company’s goodwill balance was determined to be impaired as of the balance sheet date and as a result, the
Company recorded a goodwill impairment charge writing off the goodwill balance.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
7 - Intangible Assets and Goodwill</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s intangible assets are patents
and related proprietary technology for the DenerveX System. For 2019, total amortization expense related to acquisition-related
intangible assets was $736,000 included in operating expense in the accompanying consolidated statement of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company decided to permanently suspend
manufacture and sale of the DenerveX product for the foreseeable future, as it has been unsuccessful in its attempts to source
cost effective alternative manufacturing and distributor options for the product. The Company has no future plans to commit any
additional resources related to the future development or sales efforts for the product, as it has determined that the cost to
relaunch the product back to market to be significant and indeterminable due to issues with the manufacturing and sterilization
of the product. The DenerveX System no longer represents part of the Company’s core strategic plans for the future. The Company
believes that it is more likely than not that the carrying value will not be recoverable. As a result, during the fourth quarter
of 2019 the Company recorded a charge of $2,944,000 to impair the carrying value of the technology related intangible. This charge
was recorded within the caption, “Loss on impairment” in the accompanying consolidated statements of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s goodwill balance was determined
to be impaired as of the balance sheet date due to the adverse financial results for 2019, the negative projected cash results
for 2020 and a significant decline in its market capitalization. The Company concluded that the fair value of the reporting unit
was less than the carrying amount in excess of goodwill. As a result, during the fourth quarter of 2019 the Company recorded a
$12,546,000 impairment charge, which is presented within the caption, “Loss on impairment” in the accompanying consolidated
statements of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the year ended December 31, 2018, the
Company recognized approximately $607,000 in impairment loss related to the write-off of the capitalized costs for the design
and development of an application to be sold on the iOS and Android store platforms.</p>
302710
302710
69629
69629
376816
2366569
559319
2052807
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
1 - Description of the Company</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On July 11, 2019, MedoveX Corp. (“MedoveX”)
changed its name to H-CYTE, Inc. (“H-CYTE” or the “Company”) by filing a Certificate of Amendment (the
“Amendment”) to the Company’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”)
with the Secretary of the State of Nevada. The name change and the Company’s new symbol, HCYT, became effective with FINRA
on July 15, 2019. H-CYTE was incorporated in Nevada on July 30, 2013 as SpineZ Corp.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On October 18, 2018, H-CYTE (formerly named
MedoveX) entered into an Asset Purchase Agreement (“APA”) with Regenerative Medicine Solutions, LLC, RMS Shareholder,
LLC (“Shareholder”), Lung Institute LLC (“LI”), RMS Lung Institute Management LLC (“RMS LI Management”)
and Cognitive Health Institute Tampa, LLC (“CHIT”), (collectively “RMS”). On January 8, 2019, the APA was
amended, and the Company acquired certain assets and assumed certain liabilities of RMS as reported in the 8-K/A filed in March
of 2019. Based on the terms of the APA and its amendment (collectively the “APA”), the former RMS members had voting
control of the combined company as of the closing of the RMS acquisition. For accounting purposes, the acquisition transaction
has been treated as a reverse acquisition whereby the Company is deemed to have been acquired by RMS and the historical financial
statements prior to the acquisition date of January 8, 2019 now reflect the historical financial statements of RMS.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of the merger, the consolidated results
for H-CYTE include the following wholly-owned subsidiaries: H-CYTE Management, LLC (formerly Blue Zone Health Management, LLC),
MedoveX Corp, Cognitive Health Institute, LLC, and Lung Institute Tampa, LLC (formerly Blue Zone Lung Tampa, LLC) and the results
included Lung Institute Dallas, PLLC (“LI Dallas”), Lung Institute Nashville, PLLC (“LI Nashville”), Lung
Institute Pittsburgh, PLLC (“LI Pittsburgh”), and Lung Institute Scottsdale, LLC (“LI Scottsdale”), as
Variable Interest Entities (“VIEs”). Additionally, H-CYTE Management, LLC is the operator and manager of the various
Lung Health Institute (LHI) clinics: LI Dallas, LI Nashville, LI Pittsburgh, and LI Scottsdale.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In 2019, the Company had two divisions: the
healthcare medical biosciences division (“Biosciences division”) and the DenerveX medical device division (“DenerveX
division”). In the first quarter of 2020, the Company decided to focus its available resources on the Biosciences division
as it represents a significantly greater opportunity than the DenerveX division as explained below. The Company is no longer manufacturing
or selling the DenerveX device.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Healthcare Medical Biosciences Division
(Biosciences division)</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s Biosciences division is
a medical biosciences company that develops and implements innovative treatment options in regenerative medicine to treat an array
of debilitating medical conditions. Committed to an individualized patient-centric approach, this division consistently provides
oversight and management of the highest quality care while producing positive medical outcomes.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On June 21, 2019, H-CYTE entered into an exclusive
product supply agreement with Rion, LLC (“Rion”) to develop and distribute a FDA approved therapy (known as L-CYTE-01)
for chronic obstructive pulmonary disease (“COPD”), the fourth leading cause of death in the U.S. Rion has established
a novel technology to harness the healing power of the body. Rion’s innovative exosome technology, based on science developed
at Mayo Clinic, provides an off-the-shelf platform to enhance healing in soft tissue, musculoskeletal, cardiovascular and neurological
organ systems. This agreement provides for a ten-year exclusive and extendable supply agreement with Rion to enable H-CYTE to develop
proprietary biologics.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On October 9, 2019, the Company entered into
a services agreement with Rion which provides the Company the benefit of Rion’s resources and expertise for the limited purpose
of (i) consulting with and assisting H-CYTE in the further research and development for the generation of a new cellular therapy
(L-CYTE-01) and (ii) subsequently assisting H-CYTE in seeking and obtaining FDA Phase 1 IND clearance for L-CYTE-01. Rion also
agrees to consult with H-CYTE in its arrangement for services from third parties unaffiliated with Rion to support research, development,
regulatory approval, and commercialization of L-CYTE-01.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">With these agreements, Rion will serve as the
product supplier and co-developer of L-CYTE-01 with H-CYTE for the treatment of chronic lung diseases. H-CYTE will control the
commercial development and facilitate the clinical trial investigation. After conducting joint research and development of these
biologics, H-CYTE intends to pursue submission of an investigational new drug (IND) application for review by the FDA for treatment
of COPD.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Proprietary Medical Device Business (DenerveX
medical device division)</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s business of designing and
marketing proprietary medical devices for commercial use in the U.S. and Europe began operations in late 2013. The Company received
CE marking in June 2017 for the DenerveX System, and it became commercially available throughout the European Union and several
other countries that accept CE marking. In addition to the DenerveX device itself, the Company has developed a dedicated Electro
Surgical Generator, the DenerveX Pro-40, to power the DenerveX device. Commercial production has been suspended since the first
quarter of 2019. There was less than $100,000 in revenue from the product in 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In the first quarter of 2020, the Company
made the decision to stop any further efforts to source alternative manufacturing and distributor options or other product monetizing
relationships for the DenerveX product. Although the Company believes the DenerveX technology has value, the Company does not
believe it will realize the value in the foreseeable future. The Company recorded an impairment charge for intangibles associated
with the DenerveX intellectual property and wrote off related inventory balances as of December 31, 2019.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
1 – description of the company</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On July 11, 2019, MedoveX Corp. (“MedoveX”)
changed its name to H-CYTE, Inc. (“H-CYTE” or the “Company”) by filing a Certificate of Amendment (the
“Amendment”) to the Company’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”)
with the Secretary of the State of Nevada. The name change and the Company’s new symbol, HCYT, became effective with FINRA
on July 15, 2019. H-CYTE was incorporated in Nevada on July 30, 2013 as SpineZ Corp.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On October 18, 2018, H-CYTE (formerly named
MedoveX) entered into an Asset Purchase Agreement (“APA”) with Regenerative Medicine Solutions, LLC, RMS Shareholder,
LLC (“Shareholder”), Lung Institute LLC (“LI”), RMS Lung Institute Management LLC (“RMS LI Management”)
and Cognitive Health Institute Tampa, LLC (“CHIT”), (collectively “RMS”). On January 8, 2019, the APA was
amended, and the Company acquired certain assets and assumed certain liabilities of RMS as reported in the 8-K/A filed in March
of 2019. Based on the terms of the APA and its amendment (collectively the “APA”), the former RMS members had voting
control of the combined company as of the closing of the RMS acquisition. For accounting purposes, the acquisition transaction
has been treated as a reverse acquisition whereby the Company is deemed to have been acquired by RMS and the historical financial
statements prior to the acquisition date of January 8, 2019 now reflect the historical financial statements of RMS.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Prior to the merger of H-CYTE and RMS on January
8, 2019 (the “Merger”), the consolidated results for H-CYTE include Regenerative Medicine Solutions, LLC, LI, RMS Nashville,
LLC (“Nashville”), RMS Pittsburgh, LLC (“Pittsburgh”), RMS Scottsdale, LLC (“Scottsdale”),
RMS Dallas, LLC (“Dallas”), State, LLC (“State”), Cognitive Health Institute of Tampa (“CHIT”),
RMS LI Management, and Shareholder and H-CYTE included Lung Institute Dallas, PLLC (“LI Dallas”), Lung Institute Nashville,
PLLC (“LI Nashville”), Lung Institute Pittsburgh, PLLC (“LI Pittsburgh”), and Lung Institute Scottsdale,
LLC (“LI Scottsdale”), as Variable Interest Entities (“VIEs”).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of the merger, the consolidated results
for H-CYTE include the following wholly-owned subsidiaries: H-CYTE Management, LLC (formerly Blue Zone Health Management, LLC),
MedoveX Corp, Cognitive Health Institute, LLC, and Lung Institute Tampa, LLC (formerly Blue Zone Lung Tampa, LLC) and the results
of the aforementioned VIEs. Additionally, H-CYTE Management, LLC is the operator and manager of the various Lung Health Institute
(LHI) clinics: LI Dallas, LI Nashville, LI Pittsburgh, and LI Scottsdale.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has two divisions: the medical
biosciences division (“Biosciences division”) and the DenerveX medical device division (“DenerveX division”).
The Company has decided to focus its available resources on the Biosciences division as it represents a significantly greater opportunity
than the DenerveX division as explained below. The Company is no longer manufacturing or selling the DenerveX device.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Healthcare Medical Biosciences Division
(Biosciences division)</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s Biosciences division is
a medical biosciences company that develops and implements innovative treatment options in regenerative medicine to treat an array
of debilitating medical conditions. Committed to an individualized patient-centric approach, this division consistently provides
oversight and management of the highest quality care while producing positive medical outcomes.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On June 21, 2019, H-CYTE entered into an exclusive
product supply agreement with Rion, LLC (“Rion”) to develop and distribute a FDA approved therapy (known as L-CYTE-01)
for chronic obstructive pulmonary disease (“COPD”), the fourth leading cause of death in the U.S. Rion has established
a novel technology to harness the healing power of the body. Rion’s innovative exosome technology, based on science developed
at Mayo Clinic, provides an off-the-shelf platform to enhance healing in soft tissue, musculoskeletal, cardiovascular and neurological
organ systems. This agreement provides for a 10-year exclusive and extendable supply agreement with Rion to enable H-CYTE to develop
proprietary biologics.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On October 9, 2019, the Company entered into
a services agreement with Rion which provides the Company the benefit of Rion’s resources and expertise for the limited purpose
of (i) consulting with and assisting H-CYTE in the further research and development for the generation of a new cellular therapy
(L-CYTE-01) and (ii) subsequently assisting H-CYTE in seeking and obtaining FDA Phase 1 IND clearance for L-CYTE-01. Rion also
agrees to consult with H-CYTE in its arrangement for services from third parties unaffiliated with Rion to support research, development,
regulatory approval, and commercialization of L-CYTE-01.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">With these agreements, Rion will serve as the
product supplier and co-developer of L-CYTE-01 with H-CYTE for the treatment of chronic lung diseases. H-CYTE will control the
commercial development and facilitate the clinical trial investigation. After conducting joint research and development of these
biologics, H-CYTE intends to pursue submission of an investigational new drug (IND) application for review by the FDA for treatment
of COPD. The Company also applied for a grant in March 2020 through Biomedical Advanced Research and Development Authority (“BARDA”)
to develop a protocol for the treatment of COVID-19. There can be no assurances that the Company will receive this grant.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Proprietary Medical Device Business (DenerveX
division)</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s business of designing and
marketing proprietary medical devices for commercial use in the U.S. and Europe began operations in late 2013. The Company received
CE marking in June 2017 for the DenerveX System, and it became commercially available throughout the European Union and several
other countries that accept CE marking. In addition to the DenerveX device itself, the Company has developed a dedicated Electro
Surgical Generator, the DenerveX Pro-40, to power the DenerveX device. Commercial production has been suspended since the first
quarter of 2019. There was less than $100,000 in revenue from the product in 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In the second quarter of 2019, the Company
determined that their contract manufacturer was not able to meet the requirements for producing the finished DenerveX product.
Additionally, in its evaluation of its current distribution channels, the Company determined that many of these channels were not
cost effective. As a result of the above evaluations, certain European distributor agreements were terminated; all other representatives
were notified that the Company had temporarily suspended the manufacture and sale of the DenerveX product; the Company continued
to source alternative manufacturing and distributor options; and the Company is considering other product monetizing strategies,
including, but not limited to, strategic partnerships. To date, these efforts have not been successful.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In the first quarter of 2020, the Company made
the decision to stop any further efforts to source alternative manufacturing and distributor options or other product monetizing
relationships for the DenerveX product. Although the Company believes the DenerveX technology has value, the Company does not believe
it will realize the value in the foreseeable future.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Considering the events and circumstances described
above, the Company performed a long-lived asset impairment analysis. Based on the assumption there would be no future cash flows
associated with the DenerveX product, management recorded an impairment loss of $2,944,000 for the unamortized intangible-technology
for the year ended December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The DenerveX Pro-40 generator is provided
to customers agreeing to purchase the DenerveX device and cannot be used for any other purpose. Due to the generator not being
able to be used for any other purpose, the Company has written off inventory totaling $131,000 as obsolete for the year ended
December 31, 2019.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The acquisition-date fair value of the consideration
transferred is as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 82%"><font style="font-size: 10pt">Common shares issued and outstanding</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%; text-align: right"><font style="font-size: 10pt">24,717,270</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Common shares reserved for issuance upon conversion of the outstanding Series B Preferred Stock</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">2,312,500</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total Common shares</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">27,029,770</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Closing price per share of MedoveX Common stock on January 8, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">10,811,908</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Fair value of outstanding warrants and options</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2,220,000</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Cash consideration to RMS</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(350,000</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total consideration</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">12,681,908</font></td>
<td style="padding-bottom: 2.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The acquisition-date fair value of the consideration
transferred is as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 84%"><font style="font-size: 10pt">Common shares issued and outstanding</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 13%; text-align: right"><font style="font-size: 10pt">24,717,270</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Common shares reserved for issuance upon conversion of the outstanding Series B Preferred Stock</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">2,312,500</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total Common shares</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">27,029,770</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Closing price per share of MedoveX Common stock on January 8, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">10,811,908</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Fair value of outstanding warrants and options</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2,220,000</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Cash consideration to RMS</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(350,000</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total consideration</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">12,681,908</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following table summarizes the fair values
of the assets acquired and liabilities assumed at the date of acquisition on January 8, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 82%"><font style="font-size: 10pt">Cash</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 15%; text-align: right"><font style="font-size: 10pt">(302,710</font></td>
<td style="width: 1%"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Accounts receivable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">145,757</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Inventory</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">131,455</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Prepaid expenses</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">46,153</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Property and equipment</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">30,393</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Other</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2,751</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Intangibles</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">3,680,000</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Goodwill</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">12,564,401</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total assets acquired</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">16,298,200</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Accounts payable and other accrued liabilities</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,645,399</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Derivative liability</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,215,677</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Interest-bearing liabilities and other</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">755,216</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Net assets acquired</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">12,681,908</font></td>
<td style="padding-bottom: 2.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following table summarizes the fair values
of the assets acquired and liabilities assumed at the date of acquisition on January 8, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 83%"><font style="font: 10pt Times New Roman, Times, Serif">Cash</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 13%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(302,710</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Accounts receivable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">145,757</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Inventory</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">131,455</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Prepaid expenses</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">46,153</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Property and equipment</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">30,393</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Other</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,751</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Intangibles</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3,680,000</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Goodwill</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">12,564,401</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Total assets acquired</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">16,298,200</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Accounts payable and other accrued liabilities</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,645,399</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Derivative liability</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,215,677</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Interest-bearing liabilities and other</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">755,216</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Net assets acquired</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">12,681,908</font></td>
<td> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Total interest-bearing liabilities and other
liabilities assumed are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 82%"><font style="font-size: 10pt">Notes payable</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 15%; text-align: right"><font style="font-size: 10pt">99,017</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Short-term convertible notes payable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">598,119</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Dividend payable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">57,813</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Deferred rent</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">267</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Total interest-bearing and other liabilities</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">755,216</font></td>
<td style="padding-bottom: 1.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Total interest-bearing liabilities and other liabilities assumed
are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 83%"><font style="font: 10pt Times New Roman, Times, Serif">Notes payable</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 13%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">99,017</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Short-term convertible notes payable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">598,119</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Dividend payable</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">57,813</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Deferred rent</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">267</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Total interest-bearing and other liabilities</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">755,216</font></td>
<td> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Future maturities of operating lease liabilities
as of March 31, 2020 are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Operating leases</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 73%"><font style="font-size: 10pt">Remainder of 2020</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 24%; text-align: right"><font style="font-size: 10pt">353,601</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">2021</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">154,559</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">2022</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">102,891</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">2023</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">69,333</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Total lease payments</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">680,384</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Less interest</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(55,798</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">624,586</font></td>
<td style="padding-bottom: 2.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Maturities of operating lease liabilities as
of December 31, 2019 are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Operating leases</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td><font style="font: 10pt Times New Roman, Times, Serif">Operating leases:</font></td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 75%"><font style="font: 10pt Times New Roman, Times, Serif">Due in one year or less</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 21%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">492,141</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Due after one year through two years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">154,559</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Due after two years through three years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">102,891</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Due after three years through four years</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">69,333</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Total lease payments</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">818,924</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Less interest</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(63,015</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Total</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">755,909</font></td>
<td> </td></tr>
</table>
<p style="margin: 0pt"></p>
25948
353414
49696
-2875
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
8 – Related Party Transactions</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Consulting Expense</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Effective February 1, 2019, the Company entered
into an oral consulting agreement with Mr. Raymond Monteleone, Board Member and Chairman of the Audit Committee, in which Mr. Monteleone
received $10,000 per month for advisory services and $5,000 per quarter as Audit Committee Chair in addition to regular quarterly
board meeting fees. Effective March 25, 2020, the Company reduced the advisory services to $5,000 per month and the fees per quarter
as the Audit Committee Chair to $2,500. For the three months ended March 31, 2020 and 2019, the Company has expensed approximately
$30,000, and $35,000 in compensation to Mr. Monteleone, respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into an oral consulting
arrangement with St. Louis Family Office, LLC, controlled by Jimmy St. Louis, former CEO of RMS, in January 2019 in the amount
of $10,000 per month plus benefits reimbursement for advisory services. The Company terminated this agreement effective June 30,
2019. For three months ended March 31, 2019, the Company expensed approximately $27,000 in consulting fees to St. Louis Family
Office.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into a consulting agreement
with Strategos Public Affairs, LLC (Strategos) on February 15, 2019 for a period of twelve months, unless otherwise terminated
by giving thirty days prior written notice. A close family member of the Company’s CEO is a partner in Strategos. The monthly
fee started at $4,500 and increased to approximately $7,500 per month. Strategos provided information to key policymakers in the
legislature and executive branches of government on the benefits of the cellular therapies offered by LHI, advocated for legislation
that supports policies beneficial to patient access and opposed any legislation that negatively impacts the Company’s ability
to expand treatment opportunities, and position the Company and its related entities as the expert for information and testimony.
The Company terminated this agreement in March 2020. For the three months ended March 31, 2020 and 2019, the Company expensed approximately
$15,000 and $0, respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Officers and Board Members and Related
Expenses</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In connection with the April Offering, the
Company’s CEO William Horne entered into an amendment letter to his employment agreement which provides that his salary will
be reduced to $0 per month; provided that on the date that the Company receives FDA approval to commence clinical trials for its
products, Mr. Horne’s salary will be increased to a total of $18,750 per month, or $225,000 per annum.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the three months ended March 31, 2020 and
2019, the Company paid $0 in Board of Director fees to Michael Yurkowsky and to Raymond Monteleone.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Debt and Other Obligations</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The short-term notes, related parties are
detailed in Note 2 - “Liquidity, Going Concern and Management’s Plans” in this Form 10-Q.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
8 – Related Party Transactions</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Consulting Expense</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Effective February 1, 2019, the Company entered
into an oral consulting agreement with Mr. Raymond Monteleone, Board Member and Chairman of the Audit Committee, in which Mr. Monteleone
receives $10,000 per month for advisory services and $5,000 per quarter as Audit Committee Chair in addition to regular quarterly
board meeting fees. This arrangement has no specified termination date. For year ended December 31, 2019 and 2018, the Company
has expensed approximately $125,000, and $0 in compensation to Mr. Monteleone, respectively. Effective March 25, 2020, the Company
reduced the advisory services to $5,000 per month and the fees per quarter as the Audit Committee Chair to $2,500.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into an oral consulting
arrangement with St. Louis Family Office, LLC, controlled by Jimmy St. Louis, former CEO of RMS, in January 2019 in the amount
of $10,000 per month plus benefits reimbursement for advisory services. The Company terminated this agreement effective June 30,
2019. For year ended December 31, 2019, the Company expensed approximately $68,000 in consulting fees to St. Louis Family Office.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into a consulting agreement
with Strategos Public Affairs, LLC (Strategos) on February 15, 2019 for a period of twelve months, unless otherwise terminated
by giving thirty days prior written notice. A close family member of the Company’s CEO is a partner in Strategos. The monthly
fee started at $4,500 and increased to approximately $7,500 per month. Strategos will provide information to key policymakers in
the legislature and executive branches of government on the benefits of the cellular therapies offered by LHI, advocate for legislation
that supports policies beneficial to patient access and oppose any legislation that negatively impacts the Company’s ability
to expand treatment opportunities, and position the Company and its related entities as the expert for information and testimony.
For the year ended December 31, 2019, the Company expensed approximately $71,000. The Company terminated this agreement in March
2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Board Members and Board Member Expenses</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i> </i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In July 2019, the Board appointed Dr. Andre
Terzic and Dr. Atta Behfar to the Board. On November 18, 2019, Dr. Andre Terzic and Dr. Atta Behfar resigned from the Company’s
Board of Directors to avoid any potential conflicts that could arise from the Company’s Service Agreement with Rion. Drs.
Terzic and Behfar are co-founders of Rion.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the year ended December 31, 2019, and December
31, 2018 the Company paid $5,000 and $0, respectively, each for Board of Director fees to Michael Yurkowsky and to Raymond Monteleone
for a total of $10,000, and $0 respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Debt and Other Obligations</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company had various related party transactions
in 2018. For the period of January 1, 2018 to March 13, 2018, the Company received approximately $528,000 from one of its shareholders
(RMS members) and approximately $228,000 from its CEO (RMS CEO) as part of a line of credit that was established in 2017. On March
13, 2018, the entire $1,856,000 line of credit received from the RMS members and the CEO, including contributions from 2017, was
transferred to the BioCell Capital, LLC debt instrument, (“BioCell Capital Line of Credit”).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The BioCell Capital Line of Credit also consisted
of capital contributions from related parties totaling approximately $4,306,000, inclusive of the aforementioned $1,856,000, to
RMS in 2018. The BioCell Capital Line of Credit was converted to RMS members’ equity and was excluded from the APA on January
8, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company also received a short-term advance
from one of its shareholders (RMS members), who was also the CEO of H-CYTE, in the amount of $180,000 in December 2018 for working
capital needs. This liability was not assumed in the Merger.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The short-term notes, related party as of December
31, 2019 of $1,635,000 is comprised of four loans made to the Company during 2019, by Horne Management, LLC, controlled by Chief
Executive Officer, William E. Horne. These were advanced for working capital purposes and had the terms as indicated below.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A loan for $900,000 was made on July 25, 2019.
This loan accrues interest at 5.5% and is due and payable upon demand of the creditor.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A loan for $350,000 was made on September 26,
2019 with the following terms:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 24px; text-align: justify"> </td>
<td style="width: 24px; text-align: justify"><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">12% interest rate with a maturity date of March 26, 2020. </font></td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">The Company was unable to pay back the principal and interest by November 26, 2019; therefore, it issued to Lender a three-year warrant to purchase 400,000 shares of the Company’s common stock with a purchase price of $0.75 per share in accordance with the terms of the note. </font></td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"><font style="font-size: 10pt; font-variant: small-caps">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">The Company was unable to pay back the loan on March 26, 2020, therefore, the interest rate increased to 15%.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A loan for $150,000 was made on October 28,
2019 with the following terms:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 24px"> </td>
<td style="width: 24px"><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">12% interest rate with a maturity date of April 28, 2020.</font></td></tr>
<tr style="vertical-align: top">
<td> </td>
<td><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">The Company was unable to pay back the principal and interest by December 28, 2019; therefore, it issued to Lender a three-year warrant to purchase 171,429 shares of the Company’s common stock with a purchase price of $0.75 per share in accordance with the terms of the note. </font></td></tr>
<tr style="vertical-align: top">
<td> </td>
<td><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">If the Company is unable to pay the loan as of April 28, 2020, the interest rate increases to 15%.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A loan for $235,000 was made on November 13,
2019 with the following terms:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 24px"> </td>
<td style="width: 24px"><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">12% interest rate with a maturity date of May 13, 2020.</font></td></tr>
<tr style="vertical-align: top">
<td> </td>
<td><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">The Company was unable to pay back the principal and interest by January 13, 2020, therefore in January 2020 it issued to Lender a three-year warrant to purchase 268,571 shares of the Company’s common stock with a purchase price of $0.75 per share in accordance with the terms of the note. </font></td></tr>
<tr style="vertical-align: top">
<td> </td>
<td><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">If the Company is unable to pay the loan as of May 13, 2020, the interest rate increases to 15%.</font></td></tr>
<tr style="vertical-align: top">
<td> </td>
<td> </td>
<td style="text-align: justify"> </td></tr>
<tr style="vertical-align: top">
<td> </td>
<td> </td>
<td style="text-align: justify"><font style="font-size: 10pt">In connection with the April Offering, Mr. Horne subordinated his notes to the April Secured Notes.</font></td></tr>
</table>
<p style="margin: 0pt"></p>
-1301696
-181702
2522241
1354468
1424096
69628
251330
2591869
122400
-594251
-83855
260065
697529
315026
-202103
-92464
750507
153000
125000
71000
0
1500000
0
30000
35000
125000
10000
10000
5000
10000
10000
10000
5000
5000
2500
5050
4500
1900
6900
2300
8300
7500
12600
34650
5000
2500
68000
5000
5000
3333
4500
27000
5000
2500
5000
56149
184183
92259
2000
0
299331
50000
40.817
0.50
50000
288000
288000
1424096
69628
3117000
122400
585000
3270612
454896
1202017
144618
1875731
1135546
4909724
17264
17264
99000
300000
350000
78000
1535570
300000
67000
500000
2812445
350000
3000
40000
52033
40000
52033
15
9250
1000000
200000
17700000
1875000
5000000
6000000
1250000
437500
750000
375000
125000
150000
2475000
500000
375000
62500
500000
2312500
200000
424000
403125
400000
171429
268571
1007813
14669757
400000
171429
100000
268571
244996
403125
5000000
6000000
1250000
437500
750000
375000
125000
150000
2475000
500000
375000
62500
500000
200000
424000
14669757
400000
171429
598000
598000
598000
154559
154559
102891
102891
69333
69333
22000
95000
27000
98000
632368
231222
244039
157107
583652
231222
156133
244039
632368
157107
149285
278234
412665
316736
434772
P5Y
P15Y
P7Y
P3Y
P7Y
P5Y
P7Y
P3Y
P7Y
P15Y
1800000
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
10 – Commitments & Contingencies</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Litigation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">From time to time, the Company may be involved
in routine legal proceedings, as well as demands, claims and threatened litigation that arise in the normal course of our business.
The ultimate amount of liability, if any, for any claims of any type (either alone or in the aggregate) may materially and adversely
affect the Company’s financial condition, results of operations and liquidity. In addition, the ultimate outcome of any litigation
is uncertain. Any outcome, whether favorable or unfavorable, may materially and adversely affect the Company due to legal costs
and expenses, diversion of management attention and other factors. The Company expenses legal costs in the period incurred. The
Company cannot assure that additional contingencies of a legal nature or contingencies having legal aspects will not be asserted
against the Company in the future, and these matters could relate to prior, current or future transactions or events. As of March
31, 2020, the Company had no litigation matters which required any accrual or disclosure.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Guarantee</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has guaranteed payments based upon
the terms found in the management services agreements to affiliated physicians related to LI Dallas, LI Nashville, LI Pittsburgh,
LI Scottsdale, and LI Tampa. For three months ended March 31, 2020 and 2019, payments totaling approximately $22,000 and $22,000,
respectively, were made to these physicians’ legal entities. Due to the Company ceasing operations effective March 23, 2020
in LI Dallas, LI Pittsburgh, LI Scottsdale, and LI Tampa, the guaranteed payments for these clinics will be suspended until operations
recommence at the aforementioned clinics.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Manufacturer
Liability Dispute</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company selected an FDA registered contract
manufacturer, to manufacture the DenerveX product. In 2019, the Company became aware of events which resulted in the manufacturer
not meeting certain contract performance requirements. As a result, the Company is in a dispute with the manufacturer. The Company
intends to vigorously defend its position that the manufacturer did not meet its contract performance obligations. The Company
believes the likelihood of incurring a material loss regarding the dispute with the manufacturer is reasonably possible but is
unable to estimate the amount of the loss based on information available at this time. As such, the Company has not recorded a
loss as of March 31, 2020 or December 31, 2019. The Company is not aware of any legal action regarding this matter.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
10 – Commitments & Contingencies</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Biotechnology
Agreement</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On June 21, 2019, the Company entered into
a 10-year exclusive and extendable product supply agreement with Rion that will enhance its existing cytotherapy product line,
developing a disruptive technology for COPD, the fourth leading cause of death in the U.S. Rion has established a unique exosome
technology to harness the healing power of the body. Rion’s novel exosome technology, based on science developed at Mayo
Clinic, provides an off-the-shelf platform to enhance healing in soft tissue, musculoskeletal, cardiovascular and neurological
organ systems. With this agreement, Rion will serve as the product supplier and will co-develop a proprietary cellular platform
with H-CYTE for the treatment of COPD. H-CYTE will control the commercial development and facilitate clinical trial investigation.
After conducting joint research and development of these biologics, H-CYTE intends to pursue submission of an investigational new
drug (IND) application for review by the FDA for treatment of COPD.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On October 9, 2019, the Company entered into
a services agreement with Rion, LLC which provides the Company the benefit of Rion’s resources and expertise for the limited
purpose of (i) consulting with and assisting H-CYTE in the further research and development for the generation of a new cellular
therapy (L-CYTE-01) and (ii) subsequently assisting H-CYTE in seeking and obtaining FDA Phase 1 IND clearance for L-CYTE-01. Rion
also agrees to consult with H-CYTE in its arrangement for services from third parties unaffiliated with Rion to support research,
development, regulatory approval, and commercialization of L-CYTE-01. The description of services around the L-CYTE-01 product
include research and development, process development, point of care GMP process, and investigational new drug (IND) generation
for submission to the FDA. The total compensation under the agreement is $1,500,000. H-CYTE paid Rion $750,000 in November, 2019
per the agreement to start the services outlined which is recorded as a prepaid expense on the balance sheet as of December 31,
2019 as services did not begin until 2020. The remaining $750,000 is due and payable upon the achievement of certain milestones
in the services agreement; at this time, the Company is not able to estimate when these milestones will occur.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Regenerative
Medical Equipment & Services Agreement</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On December 1, 2019, H-CYTE entered into an
agreement with Alliance Health Services S.C. to provide specialized equipment and supplies, medical practices, procedures and protocols
for regenerative medicine. Additionally, certain related training, educational development, compliance, marketing, supply chain
management, and support services are provided. H-CYTE is to receive as compensation for these services for a monthly fee of $5,000.
Alliance Health Services also agrees to purchase the supplies needed for the regenerative medicine protocols at cost provided to
H-CYTE from its manufacturer plus $450 per treatment utilization. H-CYTE prorated the initial monthly fee from $5,000 to $3,333
which were recorded as accounts receivable as of December 31, 2019. Due to the coronavirus pandemic, this agreement was suspended
indefinitely on March 23, 2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Consulting
Agreements</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into an agreement with
Jesse Crowne, a former Director and Co-Chairman of the Board of the Company, to provide business development consulting services
for a fee of $5,000 per month. Additionally, 62,500 shares of common stock at $0.29 per share was issued in connection with a separate
agreement on August 29, 2019. The Company incurred expense of approximately $83,000 for the year ended December 31, 2019 related
to these agreements. Since these agreements were assumed on January 8, 2019 as part of the Merger, there were no historical costs
related to this prior to January 8, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into a consulting agreement
with LilyCon Investments, LLC effective February 1, 2019 for services related to evaluation and negotiation of future acquisitions,
joint ventures, and site evaluations/lease considerations. The duration of the consulting agreement is for a period of twelve months
in the amount of $12,500 per month with a $15,000 signing bonus. Either party may terminate this agreement with or without cause
upon 30 days written notice. The agreement also provides LilyCon Investments with $35,000 in stock (to be calculated using an annual
variable weighted average price from February 2019 through January 2020) to be granted on the one-year anniversary of this agreement,
if the agreement has not been terminated prior to that date. For year ended December 31, 2019, the Company expensed a total of
approximately $153,000 in compensation to LilyCon Investments. In February 2020, the Company issued LilyCon Investments $35,000
in shares of H-CYTE stock at an average share price of $0.31 per share for a total of 106,061 shares per the terms of the agreement.
In March 2020, this agreement was modified to lower the monthly payment amount to $5,000. This agreement was terminated effective
April 1, 2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Effective February 1, 2019, the Company entered
into an oral consulting agreement with Mr. Raymond Monteleone, Board Member and Chairman of the Audit Committee, in which Mr. Monteleone
receives $10,000 per month for advisory services and $5,000 per quarter as Audit Committee Chair in addition to regular quarterly
board meeting fees. This arrangement has no specified termination date. For year ended December 31, 2019 and 2018, the Company
has expensed approximately $125,000, and $0 in compensation to Mr. Monteleone, respectively. Effective March 25, 2020, the Company
reduced the fees for the advisory services to $5,000 per month and the fees per quarter that Mr. Monteleone was to receive as the
Audit Committee Chair to $2,500.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into an oral consulting
arrangement with St. Louis Family Office, LLC, controlled by Jimmy St. Louis, former CEO of RMS, in January 2019 in the amount
of $10,000 per month plus benefits reimbursement for advisory services. The Company terminated this agreement effective June 30,
2019. For year ended December 31, 2019, the Company expensed approximately $68,000 in consulting fees to St. Louis Family Office.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into a consulting agreement
with Strategos Public Affairs, LLC (Strategos) on February 15, 2019 for a period of twelve months, unless otherwise terminated
by giving thirty days prior written notice. The monthly fee started at $4,500 and increased to approximately $7,500 per
month. Strategos will provide information to key policymakers in the legislature and executive branches of government on the benefits
of the cellular therapies offered by the Lung Health Institute, advocate for legislation that supports policies beneficial to patient
access and oppose any legislation that negatively impacts the Company’s ability to expand treatment opportunities, and position
the Company and its related entities as the expert for information and testimony. For the year ended December 31, 2019, the Company
expensed approximately $71,000. The Company terminated this agreement in March 2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into a consulting agreement
with Goldin Solutions, effective August 4, 2019, for media engagement and related efforts, including both proactive public relations
and crisis management services. The agreement has a minimum term of six months, with a $34,650 monthly fee plus expenses payable
each month, with the exception of a first month discount of $12,600. For year ended December 31, 2019, the Company expensed $162,000.
The Company terminated this agreement in March 2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Distribution
center and logistic services agreement</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has a non-exclusive distribution
center agreement with a logistics service provider in Berlin, Germany pursuant to which they manage and coordinate the DenerveX
System products which the Company exports to the EU through June 2020. The Company paid a fixed monthly fee of €4,500 (approximately $5,050 based
on the EU exchange rate at December 31, 2019) for all accounting, customs declarations and office support, and a variable monthly
fee ranging from €1,900 to €6,900 (approximately $2,300 to $8,300), based off volume of shipments, for logistics, warehousing
and customer support services.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Total expenses incurred for the distribution
center and logistics agreement were approximately $49,000 for the year ended December 31, 2019. Since this agreement was assumed
on January 8, 2019 as part of the reverse merger transaction, there were no historical costs related to this prior to January 8,
2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Patent
Assignment and Contribution Agreements</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The terms of a Contribution and Royalty Agreement
dated January 31, 2013 with Dr. Scott Haufe, M.D was assumed in the Merger as of January 8, 2019. This agreement provides for the
Company to pay Dr. Haufe royalties equal to 1% of revenues earned from sales of any and all products derived from the use of the
DenerveX technology. Royalties are payable to Dr. Haufe within 30 days after the close of each calendar quarter based on actual
cash collected from sales of applicable products. The royalty period expires on September 6, 2030.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company incurred approximately $1,100 in
royalty expense under the Contribution and Royalty agreement for the year ended December 31, 2019, all of which was included in
accounts payable at December 31, 2019. Since this agreement was assumed on January 8, 2019 as part of the Merger, there were no
historical costs related to this prior to January 8, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Due to the discontinuance of the DenerveX product,
no further expense from this agreement is expected.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Litigation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">From time to time, the Company may be involved
in routine legal proceedings, as well as demands, claims and threatened litigation that arise in the normal course of our business.
The ultimate amount of liability, if any, for any claims of any type (either alone or in the aggregate) may materially and adversely
affect the Company’s financial condition, results of operations and liquidity. In addition, the ultimate outcome of any litigation
is uncertain. Any outcome, whether favorable or unfavorable, may materially and adversely affect the Company due to legal costs
and expenses, diversion of management attention and other factors. The Company expenses legal costs in the period incurred. The
Company cannot assure that additional contingencies of a legal nature or contingencies having legal aspects will not be asserted
against the Company in the future, and these matters could relate to prior, current or future transactions or events.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> <font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Guarantee</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has guaranteed payments based upon
the terms found in the management services agreements to affiliated physicians related to LI Dallas, LI Nashville, LI Pittsburgh,
LI Scottsdale, and LI Tampa. For year ended December 31, 2019 and 2018, payments totaling approximately $141,000 and $119,000, respectively,
were made to these physicians’ legal entities. Due to the ramifications of the coronavirus pandemic, the Company ceased operations
effective March 23, 2020 in LI Dallas, LI Pittsburgh, LI Scottsdale, and LI Tampa. The guaranteed payments for these clinics will
be suspended until operations recommence at the aforementioned clinics.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Manufacturer
Liability Dispute</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company selected an FDA registered contract
manufacturer, to manufacture the DenerveX product. In 2019, the Company became aware of events which resulted in the manufacturer
not meeting certain contract performance requirements. As a result, the Company is in a dispute with the manufacturer. The Company
intends to vigorously defend its position that the manufacturer did not meet its contract performance obligations. The Company
believes the likelihood of incurring a material loss regarding the dispute with the manufacturer is reasonably possible but is
unable to estimate the amount of the loss based on information available at this time. As such, the Company has not recorded a
loss as of December 31, 2019. The Company is not aware of any legal action regarding this matter.</p>
11295
4730
20686
1230135
3352104
1487720
6953549
1224353
3778917
1532789
8646471
11545
1635000
180000
750000
2135000
424615
424615
1635000
1635000
1635000
1046156
326064
770031
2191
131455
131000
85000
80225
85000
200000
100000
8000000
1000000
6000000
2812445
2835195
100000
0.75
0.40
0.40
0.29
0.40
0.29
40.817
0.28
0.001
0.32
0.31
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
9 - Equity Transactions</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the consolidated statement of stockholders’
deficit as of January 1, 2019, the common stock, preferred stock and additional paid in capital reflect the accounting for the
stock received by the RMS members as of the Merger as if it was received as of that date and the historical accumulated deficit
of RMS. As of the closing of the Merger, before the contingent additional exchange shares impact from the sale of new securities,
the stock received by RMS was 33,661 shares of Series C Preferred Stock, which was later converted into approximately 33,661,000
shares of common stock, with common stock par value of approximately $33,700 and additional paid-in capital of approximately $3,566,000.
The historical accumulated deficit and non-controlling interest of RMS as of the closing was approximately $9,296,000 and $370,000,
respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Common Stock Issuance</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 8, 2019, the Company entered into
a securities purchase agreement (the “SPA”) with four purchasers (the “Purchasers”) pursuant to which the
four Purchasers invested in the Company an aggregate amount of $2,000,000, with $1,800,000 in cash and $200,000 by cancellation
of debt as explained below, in exchange for forty units (the “Units”), each consisting of a convertible note (the “Convertible
Note”) with the principal amount of $50,000 and a warrant (the “Warrant”) to purchase common stock (the “common
stock”) of the Company at a purchase price of $0.75 per share. For further discussion of the SPA, refer to Note 9 - “Equity
Transactions” to the consolidated financial statements in the Company’s Annual Report on Form 10-K is incorporated
by reference herein.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company entered into other SPA’s
with additional purchasers, which brought the aggregate amount of capital raised in all these offerings to $7,000,000, as of April
5, 2019, excluding the shares issued for conversion of short-term debt, discussed below</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As a result of the sales of new securities
of at least $5,650,000, the Company issued an additional 17,264 Series C Preferred Stock to RMS members in accordance with the
provisions of the APA in the first quarter of 2019. These shares automatically converted to 17,263,889 shares of common stock.
All the Convertible Notes from the SPA, as well as the shares of Series C Preferred Stock issued to RMS members, were automatically
converted into shares of common stock at closing on January 8, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In February 2019, 250,000 shares of common
stock were issued pursuant to conversion of short-term debt and accrued interest.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In March 2019, the Company issued an aggregate
of 130,085 shares of common stock at $0.40 per share for consulting fees in an amount equivalent to $52,033. In August 2019, the
Company issued 150,000 shares of common stock to consultants in consideration of consulting services rendered to the Company. At
the time of issuance, the fair market value of the shares was $0.29, and, as a result, $43,500 was expensed for the year ending
December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In February 2020, the Company issued LilyCon
Investments $35,000 in shares of the Company’s common stock at a weighted average share price of $0.32 per share for a total
of 109,375 shares per the terms of the consulting agreement executed in February 2019. </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Series
B Preferred Stock Preferences</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Voting
Rights</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Holders of Series B Preferred Stock (“Series
B Holders”) have the right to receive notice of any meeting of holders of common stock or Series B Preferred Stock and to
vote upon any matter submitted to a vote of the holders of common stock or Series B Preferred Stock. Each Series B Holder shall
vote on each matter submitted to them with the holders of common stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Liquidation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Upon the liquidation or dissolution of the
business of the Company, whether voluntary or involuntary, each Series B Holder shall be entitled to receive, for each share thereof,
out of assets of the Company legally available therefore, a preferential amount in cash equal to the stated value plus all accrued
and unpaid dividends. All preferential amounts to be paid to the Series B Holders in connection with such liquidation, dissolution
or winding up shall be paid before the payment or setting apart for payment of any amount for, or the distribution of any assets
of the Company’s to the holders of the Company’s common stock but after the Series D Holders receive their respective
liquidation value. The Company accrues these dividends as they are earned each period.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 8, 2019, the Company completed the
issuance of Convertible Notes with a conversion price of $0.40. As a result, the exercise price on all of the warrants issued with
the Series B Preferred Stock was adjusted downward to $0.36.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In the first quarter of 2019, the Company recognized
a beneficial conversion feature related to the Series B Preferred Stock of approximately $33,000, which was credited to additional
paid-in capital, and reduced the income available to common shareholders. Since the Series B Preferred Stock can immediately be
converted by the holder, the beneficial conversion feature was immediately accreted and recognized as a deemed dividend to the
preferred shareholders.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Series
B preferred Stock Conversions and Repurchase</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the year ended December 31, 2019, 9,250
shares of Series B Preferred Stock, par value $0.001, and accrued dividends were assumed with the Merger and an aggregate of 2,650
shares of Series B Preferred Stock, and accrued dividends, were subsequently converted into an aggregate of 715,279 shares of the
Company’s common stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Debt
Conversion</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Convertible Notes and Promissory Note
to Related Party</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The $750,000 convertible notes payable assumed
in the Merger had a fair value of approximately $598,000 on the acquisition date. Subsequently, on February 6, 2019, $100,000 of
the outstanding Convertible Notes was converted into an aggregate of 250,000 shares of common stock, eliminating $100,000 of the
Company’s debt obligation. The debt was converted into shares of common stock at $0.40 per share, in accordance with the
SPA.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Stock-Based
Compensation Plan</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company utilizes the Black-Scholes valuation
method to recognize stock-based compensation expense over the vesting period. The expected life represents the period that the
stock-based compensation awards are expected to be outstanding.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Stock
Option Activity</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the three months ended March 31, 2020 and
2019, the Company recognized approximately $600 and $89,000, respectively, as compensation expense with respect to vested stock
options. Since these stock options were assumed on January 8, 2019 as part of the Merger, there were no historical costs related
to this prior to January 8, 2019. The expense for the three months ended March 31, 2019 is primarily related to an option to purchase
250,000 shares of the Company’s common stock that was issued to the Company’s CEO pursuant to his employment agreement.
These options were immediately vested upon issuance.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of March 31,2020, all outstanding stock
options were fully vested, and related compensation expense recognized.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following is a summary of stock option
activity for the quarters ending March 31, 2019 and March 31, 2020:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Shares</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Term (Years)</b></p></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Outstanding at December 31, 2018</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 49%"><font style="font-size: 10pt">Assumed with the RMS merger transaction</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">557,282</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">2.78</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6.99</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Granted</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">250,000</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Expired</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(80,725</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">1.52</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Outstanding at March 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">726,557</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.95</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.74</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Exercisable at March 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">695,418</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.96</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.74</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Outstanding at December 31, 2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">425,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">1.38</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">7.71</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Granted</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Expired</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Outstanding and exercisable at March 31, 2020</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">425,000</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.38</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.46</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> <font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Non-Controlling
Interest</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the three months ended March 31, 2020 and
2019, the Company consolidated the results for LI Dallas, LI Nashville, LI Pittsburgh and LI Scottsdale as VIEs. The Company owns
no portion of any of these four entities which own their respective clinics; however, the Company maintains control through their
management role for each of the clinics, in accordance with each clinic’s respective management agreement. Based on these
agreements, the Company (RMS and RMS Management and now H-CYTE) has the responsibility to run and make decisions on behalf of the
clinics, except for medical procedures. Beginning in January 2018, the Company adopted the policy for all of the VIEs that the
management fee charged by the Company would equal the amount of net income from each VIE on a monthly basis, bringing the amount
of the net income each month for each VIE to a net of zero. Due to this change in policy, there was no change in the non-controlling
interest for the three months ended March 31, 2020 or 2019 related to the net income as it was $0 each month through the management
fee charged by the Company.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Net
Loss Per Share</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Basic loss per share is computed on the basis
of the weighted average number of shares outstanding for the reporting period. Diluted loss per share is computed on the basis
of the weighted average number of common shares plus dilutive potential common shares outstanding using the treasury stock method.
Any potentially dilutive securities are antidilutive due to the Company’s net losses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the periods presented, there is no difference
between the basic and diluted net loss per share: 45,319,643 warrants and 425,000 common stock options outstanding were considered
anti-dilutive and excluded for the three months ended March 31, 2020. At March 31, 2020, the only potentially dilutive shares
would be from the conversion of the convertible debt and the conversion of preferred stock, Series B and Series D totaling 38,308,600
of common stock to be issued upon conversion of all these securities. There were no option or warrant exercises that would have
been potentially dilutive.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
9 - Equity Transactions</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the consolidated statement of stockholders’
deficit as of December 31, 2018, the common stock, preferred stock and additional paid in capital reflect the accounting for the
stock received by the RMS members as of the Merger as if it was received as of the beginning of the periods presented and the historical
accumulated deficit of RMS. As of the closing of the Merger, before the contingent additional exchange shares impact from the sale
of new securities, the stock received by RMS was 33,661 shares of Series C Preferred Stock, which was later converted into approximately
33,661,000 shares of common stock, with common stock par value of approximately $33,700 and additional paid-in capital of approximately
$3,566,000. The historical accumulated deficit and non-controlling interest of RMS as of the closing was approximately $9,296,000
and $370,000, respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Common Stock Issuance</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 8, 2019, the Company entered into
a securities purchase agreement (the “SPA”) with four purchasers (the “Purchasers”) pursuant to which the
four Purchasers invested in the Company an aggregate amount of $2,000,000, with $1,800,000 in cash and $200,000 by cancellation
of debt as explained below, in exchange for forty (40) units (the “Units”), each consisting of a convertible note (the
“Convertible Note”) with the principal amount of $50,000 and a warrant (the “Warrant”) to purchase common
stock (the “common stock”) of the Company at a purchase price of $0.75 per share. Pursuant to this SPA, the Company
initially offered a minimum of $1,000,000 and a maximum of $6,000,000 of Units, and subsequently increased the maximum amount to
$8,000,000 (the “Maximum Amount”) of Units at a price of $50,000 per Unit until the earlier of (i) the closing of the
subscription of the Maximum Amount and (ii) March 31, 2019 (the “Termination Date”), subject to the Company’s
earlier termination at its discretion. The SPA includes the customary representations and warranties from the Company and purchasers.
Mr. Gorlin, the Company’s former Chairman of the Board, converted a $200,000 promissory note owed to him by the Company in
exchange for four (4) Units on the same terms as all other Purchasers. Mr. Gorlin subsequently converted the promissory note underlying
the Units into an aggregate of 500,000 shares of common stock, eliminating the Company’s debt obligation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Each Convertible Note had an interest rate
of 12% per annum, a principal amount of $50,000 maturity date of January 8, 2020, and are convertible into shares of common stock
at a price of $0.40 subject to adjustment as provided for in the Convertible Note. Pursuant to the terms of the Convertible Note,
each holder of the Convertible Note shall not own more than 4.99% of the number of shares of common stock outstanding immediately
after giving effect to the issuance of common stock issuable upon exercise of such Convertible Note. If defaulted, the penalty
interest rate of the Convertible Note shall rise to 18% per annum. In addition, each Warrant is exercisable at a price of $0.75
per share (the “Exercise Price”), subject to adjustments stated therein. The holder of each Warrant may purchase the
number of shares of common stock equal to the number of shares of common stock issuable upon conversion of each Convertible Note
while the Warrant is exercisable. The Warrants have a term of three years and shall be exercised in cash or on a cashless basis
as described in the Warrant agreement. All Convertible Notes were converted into an aggregate of 18,000,000 shares of common stock
upon closing. 17,500,000 of these shares were issued for cash and 500,000 shares were issued for conversion of short-term debt.
The issuance costs for this private placement were approximately $133,000. Additionally, in July 2019, the Company raised $100,000
by selling 200,000 shares of common stock at $0.50 per share in a separate private placement. The Company also issued the investors
100,000 warrants with an exercise price of $1.00 per share. For the year ended December 31, 2019, the Company sold a total of 17,700,000
shares of common stock through private placements for cash and another 500,000 shares for conversion of short-term debt.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As reported on Form 8-K filings on January
25, 2019, February 8, 2019, March 15, 2019 and April 5, 2019, the Company entered into other SPA’s with additional purchasers,
which brought the aggregate amount of capital raised in all these offerings to $7,000,000, as of that latest date, excluding the
shares issued for conversion of short-term debt, discussed below. In July 2019, the Company raised $100,000 by selling 200,000
shares of common stock at $0.50 per share in a separate private placement which brought the total of raised from all these offerings
to $7,100,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As a result of the sales of new securities
of at least $5,650,000, the Company issued an additional 17,264 Series C Preferred Stock to RMS members in accordance with the
provisions of the APA. These shares automatically converted to 17,263,889 shares of common stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">All the Convertible Notes from the SPA, as
well as the shares of Series C Preferred Stock issued to RMS members, were automatically converted into shares of common stock
at closing.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In February 2019, 250,000 shares of common
stock were issued pursuant to conversion of short-term debt and accrued interest.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In March 2019, the Company issued an aggregate
of 130,085 shares of common stock at $0.40 per share for consulting fees in an amount equivalent to $52,033. In August 2019, the
Company issued 150,000 shares of common stock to consultants in consideration of consulting services rendered to the Company. At
the time of issuance, the fair market value of the shares was $0.29, and, as a result, $43,500 was expensed for the year ending
December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On April 25, 2019, the Company issued 4,225,634
shares of common stock valued at $0.40 per share to Mr. William E. Horne, the Company’s CEO, in a restricted stock award
which was 100% vested when issued. The Company recognized approximately $1,690,000 of compensation expense during the year ended
December 31, 2019 related to the restricted stock award. This restricted stock award was issued pursuant to his employment agreement
with the Company, which stated that this restricted stock award (as well as the incentive stock options issued in the quarter ended
March 31, 2019) would be fully vested if not issued within fifteen days of the Merger. Neither award was issued within that time
frame and both awards became fully vested when issued. The aggregate number of shares of common stock from these two awards is
4,475,634 and was calculated based on 7% of the Company’s issued and outstanding common stock as of the closing of the Merger.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the year ended December 31, 2019, 715,279
shares were issued pursuant to conversions of 2,650 shares of Series B Convertible Preferred Stock and 50,367 shares for accrued
dividends thereunder.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In conjunction with the Series D Preferred
financing (See Note 14), the Company offered the Series B warrant holders the option to exchange their warrants on the basis of
1 warrant for 0.40 common shares. Warrant holders chose to exchange 1,007,813 warrants with a fair value of approximately $75,000
for 403,125 shares of common stock. The Series B Warrants were adjusted to fair value on the date of the exchange with the change
in fair value being recorded in earnings. The fair value of the common stock issued was $73,000 which approximated the fair value
of the Series B Warrants exchanged.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Series
B Preferred Stock Preferences</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Voting
Rights</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Holders of Series B Preferred Stock (“Series
B Holders”) have the right to receive notice of any meeting of holders of common stock or Series B Preferred Stock and to
vote upon any matter submitted to a vote of the holders of common stock or Series B Preferred Stock. Each Series B Holder shall
vote on each matter submitted to them with the holders of common stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Liquidation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Upon the liquidation or dissolution of the
business of the Company, whether voluntary or involuntary, each Series B Holder shall be entitled to receive, for each share thereof,
out of assets of the Company legally available therefore, a preferential amount in cash equal to the stated value plus all accrued
and unpaid dividends. All preferential amounts to be paid to the Series B Holders in connection with such liquidation, dissolution
or winding up shall be paid before the payment or setting apart for payment of any amount for, or the distribution of any assets
of the Company’s to the holders of the Company’s common stock but after the Series D Holders receive their respective
liquidation value. The Company accrues these dividends as they are earned each period.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 8, 2019, the Company completed the
issuance of Convertible Notes with a conversion price of $0.40. As a result, the exercise price on all of the warrants issued with
the Series B Preferred Stock was adjusted downward to 90% of that conversion price, or $0.36.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company recognized a beneficial conversion
feature related to the Series B Preferred Stock of approximately $33,000, which was credited to additional paid-in capital, and
reduced the income available to common shareholders. Since the Series B Preferred Stock can immediately be converted by the holder,
the beneficial conversion feature was immediately accreted and recognized as a deemed dividend to the preferred shareholders.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Series
B preferred Stock Conversions and Repurchase</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the year ended December 31, 2019, 9,250
shares of Series B Preferred Stock, par value $0.001, and accrued dividends were assumed with the Merger and an aggregate of 2,650
shares of Series B Preferred Stock, and accrued dividends, were subsequently converted into an aggregate of 715,279 shares of the
Company’s common stock. The Company also repurchased 500 shares of Series B Preferred Stock for $50,000 plus accrued dividends.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Debt
Conversion</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Convertible Notes and Promissory Note
to Related Party</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The $750,000 convertible notes payable assumed
in the Merger had a fair value of approximately $598,000 on the acquisition date. Subsequently, on February 6, 2019, $100,000 of
the outstanding Convertible Notes was converted into an aggregate of 250,000 shares of common stock, eliminating $100,000 of the
Company’s debt obligation. The debt was converted into shares of common stock at $0.40 per share, in accordance with the
SPA.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Stock-Based
Compensation Plan</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company utilizes the Black-Scholes valuation
method to recognize stock-based compensation expense over the vesting period. The expected life represents the period that the
stock-based compensation awards are expected to be outstanding.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Including the expense of approximately $1,690,000
related to the restricted stock award to the Company’s CEO and approximately $95,000 of compensation expense with respect
to vested stock options, total stock-based compensation expense for the year ended December 31, 2019 was approximately $1,785,000.
The recognition of the $1,690,000 in compensation expense was the result of the stock award being 100% vested upon issuance. This
restricted stock award was issued pursuant to his employment agreement with the Company, which stated that this grant would be
fully vested if not issued within fifteen days of the reverse merger transaction. The restricted stock award was not issued within
that time frame and was fully vested when issued.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Stock
Option Activity</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the year ended December 31, 2019, the Company
recognized approximately $95,000, as compensation expense with respect to vested stock options. Since these stock options were
assumed on January 8, 2019 as part of the Merger, there were no historical costs related to this prior to January 8, 2019. The
expense for the year ended December 31, 2019 is primarily related to an option to purchase 250,000 shares of the Company’s
common stock that was issued to the Company’s CEO pursuant to his employment agreement. These options were immediately vested
upon issuance.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2019, there were 3,750 shares
of unvested stock options and unrecognized compensation expense totaled approximately $600. The remaining expense will be recognized
as an expense on a straight-line basis over the remaining weighted average service period which is approximately 6.28 years.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following is a summary of stock option
activity for the year ending December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Shares</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Term (Years)</b></p></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Outstanding at December 31, 2018</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 43%"><font style="font-size: 10pt">Assumed with the Merger</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 16%; text-align: right"><font style="font-size: 10pt">557,282</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 16%; text-align: right"><font style="font-size: 10pt">2.78</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 16%; text-align: right"><font style="font-size: 10pt">6.99</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Other activity since January 8, 2019:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Granted</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">250,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">9.02</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Cancelled</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(382,282</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">2.86</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Outstanding at December 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">425,000</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.38</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.71</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Exercisable at December 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">421,250</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.38</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.71</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Non-Controlling
Interest</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the year-ended December 31, 2019 and 2018,
the Company consolidated the results for LI Dallas, LI Nashville, LI Pittsburgh and LI Scottsdale as VIEs. The Company owns no
portion of any of these four entities which entities own their respective clinics; however, the Company maintains control through
their management role for each of the clinics, in accordance with each clinic’s respective management agreement. Based on
these agreements, the Company (RMS and RMS Management and now H-CYTE) has the responsibility to run and make decisions on behalf
of the clinics, except for medical procedures. Beginning in January 2018, the Company adopted the policy for all of the VIEs that
the management fee charged by the Company would equal the amount of net income from each VIE on a monthly basis, bringing the
amount of the net income each month for each VIE to a net of zero. Due to this change in policy, there was no change in the non-controlling
interest for the years ended December 31, 2018 or 2019 related to the net income as it was $0 each month through the management
fee charged by the Company. The only change in the non- controlling interest balance in 2018 was related to the acquisition of
100% interest of State in 2018; there was no change in non-controlling interest in 2019.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
12 – Derivative Liability - Warrants</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Financial assets and liabilities carried at
fair value as of March 31, 2020 and December 31, 2019 are classified in the tables below in one of the three categories:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Fair Value Measurement at <br />
March 31, 2020 (1)</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Using <br />
Level 3</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Total</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 62%; padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Liability - Warrants</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 16%; text-align: right"><font style="font-size: 10pt">140,877</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 16%; text-align: right"><font style="font-size: 10pt">140,877</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">79,045</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">79,045</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Fair Value Measurement at <br />
December 31, 2019 (1)</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Using <br />
Level 3</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Total</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 62%; padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Liability - Warrants</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 16%; text-align: right"><font style="font-size: 10pt">315,855</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 16%; text-align: right"><font style="font-size: 10pt">315,855</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">267,399</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">267,399</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">(1) The Company did not have any assets or
liabilities measured at fair value using Level 1 or 2 of the fair value hierarchy as of March 31, 2020 and December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s derivative liabilities
are classified within Level 3 of the fair value hierarchy because certain unobservable inputs were used in the valuation models.
These assumptions included estimated future stock prices, potential down-round financings for the Warrants, and potential redemptions
for the Redemption Put Liability.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The following is a
reconciliation of the beginning and ending balances for the liability measured at fair value on a recurring basis using significant
unobservable inputs (Level 3) during the three months ended March 31, 2020 and the year ended December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font-size: 10pt"><b>Derivative Liability - Warrants</b></font></td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 77%"><font style="font-size: 10pt">Balance at December 31, 2019</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">315,855</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Fair value adjustments</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(174,978</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Balance at March 31, 2020</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">140,877</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td><font style="font-size: 10pt"><b>Redemption Put Liability</b></font></td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 77%"><font style="font-size: 10pt">Balance at December 31, 2019</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">267,399</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Issuance of Series D Convertible Preferred Stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">5,305</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Fair value adjustments</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(193,659</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Balance at March 31, 2020</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">79,045</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Derivative Liability- Warrants</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In connection with the securities purchase
agreements executed in May 2018 (which the Company assumed in the Merger), whereby 108,250 shares of the Company’s Series
B Convertible Preferred Stock (the “Series B Shares”) and warrants were issued to purchase 2,312,500 shares of the
Company’s common stock (“Series B Warrants”). The Series B Warrants had a three-year term at an exercise price
of $0.75. The Series B Warrants contain two features such that in the event of a downward price adjustment the Company is required
to reduce the strike price of the existing warrants (first feature or “down round”) and issue additional warrants to
the award holders such that the aggregate exercise price after taking into account the adjustment, will equal the aggregate exercise
price prior to such adjustment (second feature or “additional issuance”).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 8, 2019, the Company issued equity
securities which triggered the down round and additional issuance warrant features. As a result, the exercise price of the warrants
was lowered from $0.75 to $0.40 and 2,023,438 additional warrants were issued. The inclusion of the additional issuance feature
caused the warrants to be accounted for as liabilities in accordance with ASC Topic 815.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair market value of the warrants, approximately
$1,200,000, was recorded as a derivative liability as a measurement period adjustment to the purchase price allocation in the third
quarter of 2019. The derivative liability has been remeasured to fair value at the end of each reporting period and the change
in fair value, of approximately $175,000 and $0, has been recorded as a component of other income (expense) in the Company’s
consolidated statement of operations for the three months ended March 31, 2020 and 2019, respectively. The fair value of the derivative
liability included on the consolidated balance sheet was approximately $141,000 and $316,000 as of March 31, 2020 and December
31, 2019, respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Fair values for the Series B Warrants were
determined using a Lattice model which considered randomly generated stock-price paths obtained through a Geometric Brownian Motion
stock price simulation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company estimated the fair value of the
warrant derivative liability as of March 31, 2020 and December 31, 2019, respectively, using the following assumptions:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">March 31, 2020</font></td>
<td style="text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td colspan="2" style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td colspan="2" style="text-align: center"> </td>
<td style="text-align: center"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 58%"><font style="font-size: 10pt">Fair value of underlying stock</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">0.051</font></td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">0.13</font></td>
<td style="width: 1%; text-align: right"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Exercise price</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="text-align: right"> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="text-align: right"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Risk free rate</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">0.17 – 0.23</font></td>
<td style="text-align: right"><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.58 – 1.59</font></td>
<td style="text-align: right"><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected term (in years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.09 – 1.77</font></td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.34 – 2.02</font></td>
<td style="text-align: right"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Stock price volatility</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">156 – 166</font></td>
<td style="text-align: right"><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">143 - 154</font></td>
<td style="text-align: right"><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">— </font></td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">— </font></td>
<td style="text-align: right"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">Due to the down round
provision contained in the warrants, which could provide for the issuance of additional warrant shares as well as a reduction in
the exercise price, the model also considered subjective assumptions related to the shares that would be issued in a down-round
financing and the potential adjustment to the exercise price. The fair value of the warrants will be significantly influenced by
the fair value of the Company’s stock price, stock price volatility, changes in interest rates and management’s assumptions
related to the down-round provisions.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 15, 2019, the Company redeemed
a shareholder’s Series B Preferred shares for its initial face value, plus accrued dividends.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In conjunction with the Series D Preferred
financing (See Note 14), the Company offered the Series B warrant holders the option to exchange their warrants on the basis of
1 warrant for 0.40 common shares. Warrant holders chose to exchange 1,007,813 warrants with a fair value of approximately $75,000
for 403,125 shares of common stock with a fair value of approximately $73,000. On the date of the exchange, the Series B Warrants
were first adjusted to fair value with the change in fair value being recorded in earnings.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Redemption
Put Liability</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">As described in Note
14, the redemption put provision embedded in the Series D financing required bifurcation and measurement at fair value as a derivative.
If the redemption put provision is triggered, it allows either payment in cash or the issuance of “Trigger Event Warrants”.
Accordingly, the fair value of the Redemption put liability considered management’s estimate of the probability of cash payment
versus payment in Trigger Event Warrants and was valued using a Monte Carlo Simulation which uses randomly generated stock-price
paths obtained through a Geometric Brownian Motion stock price simulation. The fair value of the redemption provision will be significantly
influenced by the fair value of the Company’s stock price, stock price volatility, changes in interest rates and management’s
assumptions related to the redemption factor. The Company estimated the fair value of the Trigger Event Warrant portion of the
redemption put liability using the following assumptions on March 31, 2020 and December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">March 31, 2020</font></td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td colspan="2" style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td colspan="2" style="text-align: center"> </td>
<td style="text-align: center"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 58%"><font style="font-size: 10pt">Fair value of underlying stock</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">0.019</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">0.056</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Exercise price</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.20409</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.20409</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Risk free rate</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">0.70</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.92</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected term (in years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">9.7</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">9.9</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Stock price volatility</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">95</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">92</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">— </font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">— </font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair market value of the redemption put
liability at inception was approximately $614,000 which has been recorded as a liability and is remeasured to fair value at the
end of each reporting period. The change in fair value of approximately $194,000 and $0 has been recorded as a component of other
income (expense) in the Company’s consolidated statement of operations for the three months ended March 31, 2020 and 2019,
respectively. The fair value of the redemption put liability included on the consolidated balance sheet was approximately $79,000
and $267,000 as of March 31, 2020 and December 31, 2019, respectively.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
12 – Derivative Liability- Warrants and Redemption Put Liability</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Financial assets and liabilities carried at
fair value as of December 31, 2019 are classified in the table below in one of the three categories described in Note 3:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Fair Value Measurement at <br />
December 31, 2019 (1)</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Using <br />
Level 3</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Total</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 54%; padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Liability - Warrants</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 20%; text-align: right"><font style="font-size: 10pt">315,855</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 20%; text-align: right"><font style="font-size: 10pt">315,855</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">267,399</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">267,399</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">(1) The Company did not have any assets or
liabilities measured at fair value using Level 1 or 2 of the fair value hierarchy as of December 31, 2018 or 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The Company’s
derivative liabilities are classified within Level 3 of the fair value hierarchy because certain unobservable inputs were used
in the valuation models. These assumptions included estimated future stock prices, potential down-round financings for the Warrants,
and potential redemptions for the Redemption Put Liability.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The following is a
reconciliation of the beginning and ending balances for the liability measured at fair value on a recurring basis using significant
unobservable inputs (Level 3) during the year ended December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font-size: 10pt"><b>Derivative Liability- Warrants</b></font></td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 79%"><font style="font-size: 10pt">January 8, 2019 - date of dilutive financing</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">1,215,678</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Exchange for common stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(72,563</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Fair value adjustments</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(827,260</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Balance at December 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">315,855</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"><b> </b></p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify"><font style="font-size: 10pt"><b>Redemption Put Liability</b></font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 79%; padding-left: 12pt; text-align: justify; text-indent: -12pt"><font style="font-size: 10pt">November 15, 2019 - date of issuance</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">614,095</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Fair value adjustments</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(346,696</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Balance at December 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">267,399</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Derivative Liability- Warrants</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In connection with the securities purchase
agreements executed in May 2018 (which the Company assumed in the Merger), whereby 108,250 shares of the Company’s Series
B Convertible Preferred Stock (the “Series B Shares”) and warrants were issued to purchase 2,312,500 shares of the
Company’s common stock (“Series B Warrants”). The Series B Warrants had a three-year term at an exercise price
of $0.75. The Series B Warrants contain two features such that in the event of a downward price adjustment the Company is required
to reduce the strike price of the existing warrants (first feature or “down round”) and issue additional warrants to
the award holders such that the aggregate exercise price after taking into account the adjustment, will equal the aggregate exercise
price prior to such adjustment (second feature or “additional issuance”).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 8, 2019 the Company issued equity
securities which triggered the down round and additional issuance warrant features. As a result, the exercise price of the warrants
was lowered from $0.75 to $0.40 and 2,023,438 additional warrants were issued. The inclusion of the additional issuance feature
caused the warrants to be accounted for as liabilities in accordance with ASC Topic 815.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair market value of the warrants, approximately
$1,200,000, has been recorded as a derivative liability in the purchase price allocation. The derivative liability has been remeasured
to fair value at the end of each reporting period and the cumulative change in fair value, approximately $827,000, has been recorded
as a component of other income (expense) in the Company’s consolidated statement of operations for the year ended December
31, 2019. The fair value of the derivative liability included on the consolidated balance sheet was approximately $316,000 as of
December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Fair values for the Series B Warrants were
determined using a Lattice model which considered randomly generated stock-price paths obtained through a Geometric Brownian Motion
stock price simulation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The Company estimated
the fair value of the warrant derivative liability as of the date they were accounted for as liabilities (assumed in Merger as
of January 8, 2019) and December 31, 2019, respectively, using the following assumptions:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">January 8, 2019</font></td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 54%"><font style="font-size: 10pt">Fair value of underlying stock</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">0.13</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Exercise price</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Risk free rate</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2.57</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.58-1.59%</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected term (years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">3.00</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.34-2.02</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Stock price volatility</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">115</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">143-154%</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">Due to the down round
provision contained in the warrants, which could provide for the issuance of additional warrant shares as well as a reduction in
the exercise price, the model also considered subjective assumptions related to the shares that would be issued in a down-round
financing and the potential adjustment to the exercise price. The fair value of the warrants will be significantly influenced by
the fair value of the Company’s stock price, stock price volatility, changes in interest rates and management’s assumptions
related to the down-round provisions.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 15, 2019, the Company redeemed
a shareholder’s Series B Preferred shares for its initial face value, plus accrued dividends.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In conjunction with the Series D Preferred
financing (See Note 14), the Company offered the Series B warrant holders the option to exchange their warrants on the basis of
1 warrant for 0.40 common shares. Warrant holders chose to exchange 1,007,813 warrants with a fair value of approximately $75,000
for 403,125 shares of common stock with a fair value of approximately $73,000. On the date of the exchange, the Series B Warrants
were first adjusted to fair value with the change in fair value being recorded in earnings.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Redemption
Put Liability</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">As described in Note
14, the redemption put provision embedded in the Series D financing required bifurcation and measurement at fair value as a derivative.
If the redemption put provision is triggered, it allows either payment in cash or the issuance of “Trigger Event Warrants”.
Accordingly, the fair value of the Redemption put liability considered management’s estimate of the probability of cash payment
versus payment in Trigger Event Warrants and was valued using a Monte Carlo Simulation which uses randomly generated stock-price
paths obtained through a Geometric Brownian Motion stock price simulation. The fair value of the redemption provision will be significantly
influenced by the fair value of the Company’s stock price, stock price volatility, changes in interest rates and management’s
assumptions related to the redemption factor. The Company estimated the fair value of the Trigger Event Warrant portion of the
redemption put liability using the following assumptions on the closing date of November 15, 2019 and December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">November 15, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 54%"><font style="font-size: 10pt">Fair value of underlying stock</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">0.118</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">0.056</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Exercise price</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.20409</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.20409</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Risk free rate</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.84</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.92</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected term (in years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">10.0</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">9.9</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Stock price volatility</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">90</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">92</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Likelihood of redemption</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">50</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">50</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair market value of the redemption put
liability at inception was approximately $614,000 which has been recorded as a liability and is remeasured to fair value at the
end of each reporting period. The cumulative change in fair value, approximately $347,000, has been recorded as a component of
other income (expense) in the Company’s consolidated statement of operations for year ended December 31, 2019. The fair
value of the redemption put liability included on the consolidated balance sheet was approximately $267,000 as of December 31,
2019.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
13 - Common Stock Warrants</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A summary of the Company’s warrant issuance
activity and related information for the quarters ended March 31, 2020 and March 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Shares</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Contractual</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Life</b></p></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 49%"><font style="font-size: 10pt">Assumed as of the January 8, 2019 merger</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">12,108,743</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">1.38</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">2.60</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Issued</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">17,500,000</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">0.75</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">2.84</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Outstanding and exercisable at March 31, 2019</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">29,608,743</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">1.00</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">2.63</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Outstanding and exercisable at December 31, 2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">44,806,076</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.78</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">4.59</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Issued</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">513,567</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">0.75</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">6.13</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Outstanding and exercisable at March 31, 2020</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">45,319,643</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">0.78</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">4.61</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair value of all warrants issued are determined
by using the Black-Scholes valuation technique and were assigned based on the relative fair value of both the common stock and
the warrants issued. The inputs used in the Black-Scholes valuation technique to value each of the warrants as of their respective
issue dates are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Event Description</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Date</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Number of Warrants</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>H-CYTE Stock Price</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Exercise Price of Warrant</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Grant Date Fair Value</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Life of Warrant</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Risk Free Rate of Return (%)</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Annualized Volatility Rate (%)</b></font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 24%"><font style="font-size: 8pt">Private placement</font></td>
<td style="width: 1%"> </td>
<td style="width: 10%; text-align: center"><font style="font-size: 8pt">1/8/2019</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 10%; text-align: right"><font style="font-size: 8pt">5,000,000</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 8pt">$</font></td>
<td style="width: 3%; text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 8pt">$</font></td>
<td style="width: 7%; text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 8pt">$</font></td>
<td style="width: 3%; text-align: right"><font style="font-size: 8pt">0.24</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 9%; text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 5%; text-align: right"><font style="font-size: 8pt">2.57</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 9%; text-align: right"><font style="font-size: 8pt">115.08</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Antidilution provision<sup>(1)</sup></font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/8/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2,023,438</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.28</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.57</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">115.08</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/18/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">6,000,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.23</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.60</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">114.07</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/25/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1,250,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.59</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.38</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.72</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/31/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">437,500</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.54</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.34</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.47</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">2/7/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">750,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.57</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.36</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.46</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.23</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">2/22/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">375,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.49</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.30</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.46</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.34</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/1/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">125,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.52</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.33</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.54</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.42</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/8/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">150,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.59</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.38</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.53</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/11/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2,475,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.61</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.45</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.62</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/26/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">500,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.32</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.18</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.12</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/28/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">375,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.18</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">112.79</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/29/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">62,500</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.21</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">112.79</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">4/4/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">500,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.48</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.29</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.29</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">112.77</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">7/15/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">200,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.53</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">1.00</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.80</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">115.50</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Convertible debt extension</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">9/18/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">424,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.25</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.72</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">122.04</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement of Series D Convertible Preferred Stock</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">11/15/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">14,669,757</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.28</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.19</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">10 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.84</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">89.75</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Short-term note related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">11/26/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">400,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.20</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.13</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.58</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">144.36</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Short-term note, related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">12/30/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">171,429</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.14</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.08</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.59</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">145.29</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Short-term note, related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/13/2020</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">268,571</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.12</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.07</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.60</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">145.76</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement of Series D Convertible Preferred Stock</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/17/2020</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">244,996</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.15</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.13</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">10 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.84</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">144.32</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><sup>(1) </sup>The Company had warrants that
triggered the required issuance of an additional 2,023,438 warrants as a result of the Company’s capital raise that gave
those new investors a $0.40 per share investment price which required the old warrant holders to receive additional warrants since
their price was $0.75 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The methods described above may produce a
fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while
the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different
methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value
measurement at the reporting date.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
13 - Common Stock Warrants</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Fair value measurement valuation techniques,
to the extent possible, should maximize the use of observable inputs and minimize the use of unobservable inputs. The Company’s
fair value measurements of all warrants are designated as Level 1 since all of the significant inputs are observable and quoted
prices used for volatility were available in an active market.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A summary of the Company’s warrant issuance
activity and related information for the year ended December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Shares</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Exercise</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Average</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Remaining</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Contractual</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Life</b></p></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 55%"><font style="font: 10pt Times New Roman, Times, Serif">Assumed as of the January 8, 2019 merger</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"> </td>
<td style="width: 12%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">12,108,743</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 11%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.38</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 11%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.53</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Exchanged</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(1,007,813</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expired</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(2,183,478</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.73</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Issued</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">35,888,624</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.73</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5.36</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Outstanding and exercisable at 12/31/19</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">44,806,076</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.78</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4.59</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair value of all warrants issued are determined
by using the Black-Scholes valuation technique and were assigned based on the relative fair value of both the common stock and
the warrants issued. The inputs used in the Black-Scholes valuation technique to value each of the warrants issued at December
31, 2019 as of their respective issue dates are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Event Description</b></font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Date</b></font></td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif"><b>Number of Warrants</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>H-CYTE Stock Price</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Exercise Price of Warrant</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Grant Date Fair Value</b></font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Life of Warrant</b></font></td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Risk Free Rate of Return (%)</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Annualized Volatility Rate (%)</b></font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 36%"><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td style="width: 2%"> </td>
<td style="width: 7%; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/8/2019</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"> </td>
<td style="width: 5%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5,000,000</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 5%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 5%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 4%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.24</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 6%; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 4%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.57</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 4%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">115.08</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Antidilution provision<sup>(1)</sup></font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/8/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,023,438</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.28</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.57</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">115.08</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/18/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">6,000,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.23</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.60</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">114.07</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/25/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,250,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.59</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.38</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.72</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/31/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">437,500</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.54</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.34</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.47</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">2/7/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">750,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.57</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.36</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.46</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.23</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">2/22/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">375,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.49</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.30</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.46</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.34</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/1/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">125,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.52</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.33</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.54</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.42</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/8/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.59</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.38</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.53</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/11/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,475,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.61</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.45</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.62</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/26/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">500,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.32</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.18</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.12</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/28/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">375,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.18</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">112.79</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/29/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">62,500</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.21</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">112.79</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">4/4/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">500,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.48</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.29</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.29</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">112.77</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">7/15/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">200,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.53</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.00</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.80</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">115.50</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Convertible debt extension</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">9/18/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">424,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.25</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.72</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">122.04</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement of Series D Convertible Preferred Stock</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">11/15/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">14,669,757</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.28</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.19</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">10 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.84</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">89.75</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Short-term note related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">11/26/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">400,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.20</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.13</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.58</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">144.36</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Short-term note, related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">12/30/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">171,429</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.14</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.08</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.59</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">145.29</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><sup>(1) </sup>The Company had warrants
that triggered the required issuance of an additional 2,023,438 warrants as a result of the Company’s capital raise that
gave those new investors a $0.40 per share investment price which required the old warrant holders to receive additional warrants
since their price was $0.75 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The methods described above may produce a
fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while
the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different
methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value
measurement at the reporting date.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair value of all warrants issued are determined
by using the Black-Scholes valuation technique and were assigned based on the relative fair value of both the common stock and
the warrants issued. The inputs used in the Black-Scholes valuation technique to value each of the warrants as of their respective
issue dates are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Event Description</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Date</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Number of Warrants</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>H-CYTE Stock Price</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Exercise Price of Warrant</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Grant Date Fair Value</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Life of Warrant</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Risk Free Rate of Return (%)</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 8pt"><b>Annualized Volatility Rate (%)</b></font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 24%"><font style="font-size: 8pt">Private placement</font></td>
<td style="width: 1%"> </td>
<td style="width: 10%; text-align: center"><font style="font-size: 8pt">1/8/2019</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 10%; text-align: right"><font style="font-size: 8pt">5,000,000</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 8pt">$</font></td>
<td style="width: 3%; text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 8pt">$</font></td>
<td style="width: 7%; text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 8pt">$</font></td>
<td style="width: 3%; text-align: right"><font style="font-size: 8pt">0.24</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 9%; text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 5%; text-align: right"><font style="font-size: 8pt">2.57</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 9%; text-align: right"><font style="font-size: 8pt">115.08</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Antidilution provision<sup>(1)</sup></font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/8/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2,023,438</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.28</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.57</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">115.08</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/18/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">6,000,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.23</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.60</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">114.07</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/25/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1,250,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.59</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.38</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.72</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/31/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">437,500</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.54</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.34</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.47</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">2/7/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">750,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.57</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.36</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.46</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.23</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">2/22/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">375,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.49</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.30</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.46</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.34</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/1/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">125,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.52</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.33</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.54</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.42</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/8/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">150,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.59</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.38</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.53</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/11/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2,475,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.61</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.45</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.62</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/26/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">500,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.32</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.18</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">113.12</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/28/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">375,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.18</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">112.79</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3/29/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">62,500</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.21</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">112.79</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">4/4/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">500,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.48</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.29</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">2.29</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">112.77</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">7/15/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">200,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.53</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">1.00</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.80</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">115.50</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Convertible debt extension</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">9/18/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">424,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.25</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.72</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">122.04</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement of Series D Convertible Preferred Stock</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">11/15/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">14,669,757</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.28</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.19</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">10 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.84</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">89.75</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Short-term note related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">11/26/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">400,000</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.20</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.13</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.58</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">144.36</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Short-term note, related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">12/30/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">171,429</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.14</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.08</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.59</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">145.29</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 8pt">Short-term note, related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/13/2020</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">268,571</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.12</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.07</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.60</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">145.76</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 8pt">Private placement of Series D Convertible Preferred Stock</font></td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">1/17/2020</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">244,996</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.15</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 8pt">$</font></td>
<td style="text-align: right"><font style="font-size: 8pt">0.13</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font-size: 8pt">10 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">1.84</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 8pt">144.32</font></td>
<td></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The inputs used in the Black-Scholes valuation
technique to value each of the warrants issued at December 31, 2019 as of their respective issue dates are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Event Description</b></font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Date</b></font></td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif"><b>Number of Warrants</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>H-CYTE Stock Price</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Exercise Price of Warrant</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Grant Date Fair Value</b></font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Life of Warrant</b></font></td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Risk Free Rate of Return (%)</b></font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif"><b>Annualized Volatility Rate (%)</b></font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 36%"><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td style="width: 2%"> </td>
<td style="width: 7%; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/8/2019</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"> </td>
<td style="width: 5%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5,000,000</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 5%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 5%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 4%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.24</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 6%; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 4%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.57</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 4%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">115.08</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Antidilution provision<sup>(1)</sup></font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/8/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,023,438</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.28</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.57</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">115.08</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/18/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">6,000,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.23</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.60</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">114.07</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/25/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,250,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.59</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.38</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.72</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">1/31/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">437,500</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.54</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.34</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.47</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">2/7/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">750,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.57</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.36</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.46</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.23</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">2/22/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">375,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.49</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.30</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.46</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.34</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/1/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">125,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.52</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.33</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.54</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.42</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/8/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">150,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.59</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.38</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.43</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.53</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/11/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,475,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.61</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.45</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.62</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/26/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">500,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.32</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.18</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">113.12</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/28/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">375,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.18</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">112.79</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3/29/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">62,500</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.51</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.21</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">112.79</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">4/4/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">500,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.48</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.29</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.29</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">112.77</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">7/15/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">200,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.53</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.00</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.31</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.80</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">115.50</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Convertible debt extension</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">9/18/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">424,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.25</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.72</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">122.04</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Private placement of Series D Convertible Preferred Stock</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">11/15/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">14,669,757</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.28</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.19</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">10 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.84</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">89.75</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Short-term note related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">11/26/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">400,000</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.20</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.13</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.58</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">144.36</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Short-term note, related party</font></td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">12/30/2019</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">171,429</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.14</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.75</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0.08</font></td>
<td> </td>
<td> </td>
<td style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">3 years</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.59</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">145.29</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><sup>(1) </sup>The Company had warrants
that triggered the required issuance of an additional 2,023,438 warrants as a result of the Company’s capital raise that
gave those new investors a $0.40 per share investment price which required the old warrant holders to receive additional warrants
since their price was $0.75 per share.</p>
150564
136943
736000
0
184000
P10Y
P10Y
5800
5800
0.12
0.12
Eliminating $100,000 of the Company's debt obligation.
Each Unit consists of (i) a 12% senior secured convertible note, initially convertible into shares of the Company's common stock, par value $0.001 per share, at a conversion price equal to the lesser of $0.40 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock equivalents issued in future private placements of equity and/or debt securities completed by the Company following this offering, and (ii) a three-year warrant to purchase such number of shares of the Company's common stock equal to one hundred percent (100%) of the number of shares of common stock issuable upon conversion of the notes at $0.40. The Warrants were initially exercisable at a price equal to the lesser of $0.75 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock equivalents issued in future private placements of the debt and/or equity securities completed by the Company following the issuance of warrants.
The Company finalized an eighteen-month extension to March 1, 2021.
Each Unit consists of (i) a 12% senior secured convertible note, initially convertible into shares of the Company's common stock, par value $0.001 per share, at a conversion price equal to the lesser of $0.40 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock equivalents issued in future private placements of equity and/or debt securities completed by the Company following this offering, and (ii) a three-year warrant to purchase such number of shares of the Company's common stock equal to one hundred percent (100%) of the number of shares of common stock issuable upon conversion of the notes at $0.40. The Warrants were initially exercisable at a price equal to the lesser of $0.75 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock equivalents issued in future private placements of the debt and/or equity securities completed by the Company following the issuance of warrants.
The convertible notes had maturity dates between August and September 2019.
The Company finalized an eighteen-month extension to March 1, 2021.
4306300
100000
750000
2023438
2023438
316000
141000
1200000
1200000
73000
75000
73000
3000000
3000000
106000
75000
513567
17500000
35888624
0.75
0.75
0.73
P4Y7M2D
P2Y7M6D
P1Y6M10D
P6Y1M16D
P2Y10M3D
P5Y4M9D
0.24
0.23
0.38
0.34
0.36
0.30
0.33
0.38
0.40
0.32
0.31
0.31
0.29
0.31
0.25
0.19
0.13
0.08
0.07
0.13
0.24
0.23
0.38
0.34
0.36
0.30
0.33
0.38
0.40
0.32
0.31
0.31
0.29
0.31
0.25
0.19
0.13
0.08
2.57
115.08
2.60
114.07
2.43
113.72
2.43
113.47
2.46
113.23
2.46
113.34
2.54
113.42
2.43
113.53
2.45
113.62
2.18
113.12
2.18
112.79
2.21
112.79
2.29
112.77
1.80
115.50
1.72
122.04
89.75
1.84
1.58
144.36
1.59
145.29
1.60
145.76
144.32
1.84
2.57
115.08
2.60
114.07
2.43
113.72
2.43
113.47
2.46
113.23
2.46
113.34
2.54
113.42
2.43
113.53
2.45
113.62
2.18
113.12
2.18
112.79
2.21
112.79
2.29
112.77
1.80
115.50
1.72
122.04
1.84
89.75
1.58
144.36
1.59
145.29
424000
424000
827000
175000
4217946
4337106
100000
589063
3386300
6777447
14038768
6137
14684
10937
370636
-276125
-309376
69750
720092
-6972
76504
13529
150564
533035
136943
579770
39363
158371
-78987
-10592
.001
.001
.001
238871
238871
238871
146998
0
149448
146998
0
149448
158147
3190639
-9460742
33661
3566339
-4868454
-6066540
33661
3566339
-9296408
99769
6
28172146
-37362531
-1672391
-370132
-370132
9151021
-403937
7
6
94037
99878
17610529
28117978
-8183420
-39815966
-370132
-370132
-11968236
33661388
33661388
99768704
6100
7200
6100
94036746
99878079
2663797
2565638
36512
36512
2565638
2663797
36512
36512
500
125437
225937
750
225187
125937
74063
74063
74063
74063
17264
-17264
17264
-17264
35000
280
95253
52034
43500
130
109
51904
34891
95533
43500
35000
17636
56378
17636
56378
-158147
-60493
-3130146
-120940
-37207
-3190639
31902
1893006
31902
1893006
643
94828
89043
89043
643
94828
-18300
-84939
-18300
-84939
100000
5888017
225937
74063
74063
31902
1893006
18300
24638
65512
-368637
-1173956
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
14- Mezzanine Equity and Series D Convertible Preferred Stock</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Series
D Convertible preferred Stock</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 15, 2019, the Company entered into
a securities purchase agreement with selected accredited investors whereby the Company offered (i) up to 238,871 shares of Series
D Convertible Preferred Stock the (“Series D Shares”) at a price of $40.817 per share and (ii) a ten-year warrant (the
“Series D Warrant”) to purchase 14,669,757 shares of common stock. The Series D Warrants are exercisable for a period
of 10 years from issuance at an initial exercise price of $0.75 per share, subject to adjustment for traditional equity restructurings
and reorganizations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 21,2019, the Company entered into
a securities purchase agreement with FWHC HOLDINGS, LLC (“FWHC”) an accredited investor for the purchase of 146,998
shares of Series D Preferred Stock, par value $0.001 per share and the Series D Warrant resulting in $6.0 million in gross proceeds
to the Company (the “FWHC Investment”). For further discussion of the Series D Shares, refer to Note 14 - “Mezzanine
Equity and Series D Convertible Preferred Stock” on the consolidated financial statements in the Company’s Annual Report
on Form 10-K for the year-ended December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company determined that the nature of the
Series D Shares was more analogous to an equity instrument, and that the economic characteristics and risks of the embedded conversion
option was clearly and closely related to the Series D Shares. As such, the conversion option was not required to be bifurcated
from the host under ASC 815, <i>Derivatives and Hedging</i>. The Company recognized a beneficial conversion feature related to
the Series D Shares of approximately $623,000, which was credited to additional paid-in capital, and reduced the income available
to common shareholders. Because the Series D Shares can immediately be converted by the holder, the beneficial conversion feature
was immediately accreted and recognized as a deemed dividend to the preferred shareholders. Since the Series D Shares are redeemable
in certain circumstances upon the occurrence of an event that is not solely within the Company’s control, they have been
classified as mezzanine equity in the Consolidated Balance Sheets.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company determined that the economic characteristics
and risks of the embedded redemption provision were not clearly and closely related to the Series D Shares. The Company assessed
the embedded redemption provision further, and determined it met the definition of a derivative and required classification as
a derivative liability at fair value. The redemption put liability as of March 31, 2020 and December 31, 2019, was approximately
$79,000 and $267,000, respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s approach to the allocation
of the proceeds to the financial instruments was to first allocate basis to the redemption put liability at its fair values and
the residual to the Series D Shares and the Series D Warrants. Based upon the amount allocated to the Series D Shares the Company
was required to determine if a beneficial conversion feature (“BCF”) was present. A BCF represents the intrinsic value
in the convertible instrument, adjusted for amounts allocated to other financial instruments issued in the financing. The effective
conversion price is calculated as the amount allocated to the convertible instrument divided by the number of shares to which it
is indexed. However, a BCF is limited to the basis initially allocated. After allocating a portion of the proceeds to the other
instruments, the effective conversion price was $0.24 compared to the share price of $0.28, resulting in a BCF of $623,045 or $0.04
per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Based upon the above accounting conclusions
and the additional information provided below, the allocation of the proceeds arising from the Series D Preferred financing transaction
is summarized in the table below:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">November 21, 2019 Series D Convertible Preferred and warrant financing:</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Proceeds Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Financing Cost Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Total Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 49%"><font style="font-size: 10pt">Gross proceeds</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Financing costs paid in cash</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">5,888,017</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Derivative Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(614,095</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(614,095</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Deferred Financing costs</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">8,100</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">8,100</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Redeemable preferred stock:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Series D Convertible Preferred Stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2,869,854</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2,869,854</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Financing costs (APIC)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,106</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,106</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Financing costs (Retained Earnings)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">66,265</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">66,265</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Beneficial Conversion Feature</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(623,045</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(623,045</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Investor Warrants (equity classified):</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Proceeds allocation</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1,893,006</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1,893,006</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Financing costs (APIC)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">36,512</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">36,512</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(6,000,000</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">111,983</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(5,888,017</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Since the Series D Convertible Preferred Stock
is perpetual and convertible at any time, the resulting discount of $3,130,146 was accreted as a Preferred Stock dividend on the
date of issuance to record the Series D Convertible Preferred Stock to its redemption value of $6,000,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 17, 2020, the Company entered into
a securities purchase agreement with an accredited investor for the purchase of 2,450 shares of Series D Preferred Stock, par value
$0.001 per share and a Series D Warrant resulting in $100,000 in gross proceeds to the Company. The Series D Preferred Stock and
Warrants had the same terms as the FWHC Investment. There was no BCF associated with this financing because the effective conversion
price after allocating a portion of the proceeds to the other instruments was higher than the share price.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">January 17, 2020 Series D Convertible Preferred and warrant financing:</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Proceeds Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 76%"><font style="font-size: 10pt">Gross proceeds</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 21%; text-align: right"><font style="font-size: 10pt">100,000</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Financing costs paid in cash</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">100,000</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Derivative Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(5,305</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Redeemable preferred stock:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Series D Convertible Preferred Stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(62,793</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Investor Warrants (equity classified):</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Proceeds allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(31,902</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(100,000</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Since the Series D Convertible Preferred Stock
is perpetual and convertible at any time, the resulting discount of $37,207 was accreted as a Preferred Stock dividend on the date
of issuance to record the Series D Convertible Preferred Stock to its redemption value of $100,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the three months ended March 31, 2020,
the Company recorded $158,147 in deemed dividends on the Series D Convertible Preferred stock in accordance with the 8% stated
dividend resulting in a total balance of Series D Convertible Preferred stock of $6,281,433 at March 31, 2020.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Series
D CONVERTIBLE Preferred Stock Preferences</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Voting
Rights</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Holders of our Series D Preferred Stock (“Series
D Holders”) have the right to receive notice of any meeting of holders of common stock or Series D Preferred Stock and to
vote upon any matter submitted to a vote of the holders of common stock or Series D Preferred Stock. Each Series D Holder shall
vote on each matter submitted to them with the holders of common stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Liquidation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Upon the liquidation, dissolution or winding
up of the Company, whether voluntary or involuntary, each Series D Holder shall be entitled to receive, for each share thereof,
out of assets of the Company legally available therefore, a preferential amount in cash equal to the stated value plus all accrued
and unpaid dividends. All preferential amounts to be paid to the Series D Holders in connection with such liquidation, dissolution
or winding up shall be paid before the payment or setting apart for payment of any amount for, or the distribution of any assets
of the Company’s to the holders of the Company’s Series B and common stock. The Company accrues these dividends as
they are earned each period.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
14- Mezzanine Equity AND SERIES D CONVERTIBLE PREFERRED STOCK</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Series
D Convertible preferred Stock</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 15, 2019, the Company entered into
a securities purchase agreement with selected accredited investors whereby the Company offered (i) up to 238,871 shares of Series
D Convertible Preferred Stock the (“Series D Shares”) at a price of $40.817 per share and (ii) a ten-year warrant (the
“Series D Warrant”) to purchase 14,669,757 shares of common stock. The Series D Warrants are exercisable for a period
of 10 years from issuance at an initial exercise price of $0.75 per share, subject to adjustment for traditional equity restructurings
and reorganizations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 21,2019, the Company entered into
a securities purchase agreement with FWHC HOLDINGS, LLC (“FWHC”) an accredited investor for the purchase of 146,998
shares of Series D Preferred Stock, par value $0.001 per share and the Series D Warrant resulting in $6.0 million in gross proceeds
to the Company (the “FWHC Investment”). The Shares were sold at a price of $40.817 per Share and each Share is convertible
into 100 shares of Common Stock. Accordingly, the conversion price into common stock is $0.40817 per share. In connection with
the FWHC Investment, the Company, FWHC and certain key holders entered into a Right of First Refusal and Co-Sale Agreement (the
“RFRC Agreement”) which provides for certain rights with respect to the shares held by FWHC and the key holders. The
key holders are identified in the RFRC Agreement and include the Company’s principal stockholder RMS Shareholder, LLC and
the Company’s CEO, William E. Horne. The Company, FWHC and certain other holders of the Company’s voting stock entered
into a Voting Agreement (“Voting Agreement”) with respect to the size and composition of the Company’s Board
and certain other items if requested by FWHC. In connection the FWHC Investment, the Company and FWHC entered into an Investors’
Rights Agreement (the “IRA”) which provided FWHC with other additional rights including but not limited to, registration
rights, board observer rights, and a right of first refusal for future offerings. The Series D Shares vote with the common shareholders
on an if-converted basis and provide for cumulative dividends at 8% of the stated value, payable upon a liquidation or redemption.
For any other dividends, the Series D Shares will participate with common stock on an as-converted basis. Each Series D Share is
convertible into common shares at a conversion price of $100 per common share. The conversion price is subject to adjustment for
anti-dilution protection and traditional equity restructuring and reorganizations. The Series D Shares will be mandatorily converted
upon the earlier of 1) the written consent of holders of a majority of Series D shareholders and 2) the common stock is listed
and quoted on one of the NASDAQ markets or the New York Stock Exchange as a result of a public offering at a price of at least
$1.22451 per share and proceeds of at least $25 million. The Series D Shares also contain an embedded mandatory redemption provision
which will occur at the earliest of: (a) 90 days following the date that William E. Horne is no longer serving as the Corporation’s
CEO and a majority of the Series D holders do not approve of his replacement, (b) William E Horne transfers more than 25% of the
stock owned by him to a person not related to him or a current shareholder or (c) the Company’s common stock is not listed
on a NASDAQ market or the New York Stock Exchange within 30 months as a result of a public offering generating minimum net proceeds
of at least $25 million (the “Trigger Date”). The redemption price to be paid is the greater of a) the Original Issue
Price of $40.817, plus any accrued and unpaid dividends and (b) the fair market value of the Series D Shares on the redemption
date. In lieu of redeeming the Series D Shares for cash, the holder may elect to receive “Trigger Event Warrants” equal
to the number of shares of common stock the Series D Shares are convertible into on the Trigger Date. The Trigger Event Warrants
will have a ten-year term from the date of redemption and allow the holders to purchase shares of common stock at a price equal
to the lower of a) 0.50% of the Original Issue Price and b) the Series D conversion price on the Trigger Date.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company determined that the nature of the
Series D Shares was more analogous to an equity instrument, and that the economic characteristics and risks of the embedded conversion
option was clearly and closely related to the Series D Shares. As such, the conversion option was not required to be bifurcated
from the host under ASC 815, <i>Derivatives and Hedging</i>. The Company recognized a beneficial conversion feature related to
the Series D Shares of approximately $623,000, which was credited to additional paid-in capital, and reduced the income available
to common shareholders. Because the Series D Shares can immediately be converted by the holder, the beneficial conversion feature
was immediately accreted and recognized as a deemed dividend to the preferred shareholders. Since the Series D Shares are redeemable
in certain circumstances upon the occurrence of an event that is not solely within the Company’s control, they have been
classified as mezzanine equity in the Consolidated Balance Sheets.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company determined that the economic characteristics
and risks of the embedded redemption provision were not clearly and closely related to the Series D Shares. The Company assessed
the embedded redemption provision further, and determined it met the definition of a derivative and required classification as
a derivative liability at fair value. The redemption put liability as of inception and December 31, 2019, was approximately $614,000
and $267,000, respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s approach to the allocation
of the proceeds to the financial instruments was to first allocate basis to the redemption put liability at its fair values and
the residual to the Series D Shares and the Series D Warrants. Based upon the amount allocated to the Series D Shares the Company
was required to determine if a beneficial conversion feature (“BCF”) was present. A BCF represents the intrinsic value
in the convertible instrument, adjusted for amounts allocated to other financial instruments issued in the financing. The effective
conversion price is calculated as the amount allocated to the convertible instrument divided by the number of shares to which it
is indexed. However, a BCF is limited to the basis initially allocated. After allocating a portion of the proceeds to the other
instruments, the effective conversion price was $0.24 compared to the share price of $0.28, resulting in a BCF of $623,045 or $0.04
per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Based upon the above accounting conclusions
and the additional information provided below, the allocation of the proceeds arising from the Series D Preferred financing transaction
is summarized in the table below:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">October 18, 2019 Series D Convertible Preferred and warrant financing:</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Proceeds Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Financing Cost Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Total Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 49%"><font style="font-size: 10pt">Gross proceeds</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Financing costs paid in cash</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(5,888,017</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Derivative Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(614,095</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(614,095</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Deferred Financing costs</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">8,100</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">8,100</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Redeemable preferred stock:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Series D Convertible Preferred Stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2,869,854</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2,869,854</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Financing costs (APIC)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,106</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,106</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Financing costs (Retained Earnings)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">66,265</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">66,265</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Beneficial Conversion Feature</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(623,045</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(623,045</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Investor Warrants (equity classified):</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Proceeds allocation</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1,893,006</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1,893,006</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Financing costs (APIC)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">36,512</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">36,512</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(6,000,000</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">111,983</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(5,888,017</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Since the Series D Convertible Preferred Stock
is perpetual and convertible at any time, the resulting discount of $3,130,146 was accreted as a Preferred Stock dividend on the
date of issuance to record the Series D Convertible Preferred Stock to its redemption value of $6,000,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company recorded $60,493 in deemed dividends
on the Series D Convertible Preferred stock in accordance with the 8% stated dividend resulting in a total balance of Series D
Convertible Preferred stock of $6,060,493 at December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Series
D CONVERTIBLE Preferred Stock Preferences</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Voting
Rights</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Holders of our Series D Preferred Stock (“Series
D Holders”) have the right to receive notice of any meeting of holders of common stock or Series D Preferred Stock and to
vote upon any matter submitted to a vote of the holders of common stock or Series D Preferred Stock. Each Series D Holder shall
vote on each matter submitted to them with the holders of common stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Liquidation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Upon the liquidation, dissolution or winding
up of the Company, whether voluntary or involuntary, each Series D Holder shall be entitled to receive, for each share thereof,
out of assets of the Company legally available therefore, a preferential amount in cash equal to the stated value plus all accrued
and unpaid dividends. All preferential amounts to be paid to the Series D Holders in connection with such liquidation, dissolution
or winding up shall be paid before the payment or setting apart for payment of any amount for, or the distribution of any assets
of the Company’s to the holders of the Company’s common stock. The Company accrues these dividends as they are earned
each period.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The components of lease expense for the three
months ended March 31, 2020 and 2019, respectively, are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Three months ended <br />
March 31,</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2020</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 62%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating lease expense</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 16%; text-align: right"><font style="font-size: 10pt">150,564</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 16%; text-align: right"><font style="font-size: 10pt">136,943</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The components of lease expense for the years
ended December 31, 2019 and 2018, respectively, are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Year ended December 31,</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 57%"><font style="font: 10pt Times New Roman, Times, Serif">Operating lease expense</font></td>
<td style="width: 2%"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">579,770</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 17%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">533,035</font></td>
<td style="width: 1%"> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Cash paid for amounts included in the measurement
of lease liabilities for the three months ended March 31, 2020 and 2019, respectively, are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Three months ended <br />
March 31,</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2020</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 62%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating cash flows from operating leases</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 16%; text-align: right"><font style="font-size: 10pt">150,564</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 16%; text-align: right"><font style="font-size: 10pt">136,943</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Cash paid for amounts included in the measurement
of lease liabilities for the years ended December 31, 2019 and 2018, respectively, are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Year ended December 31,</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 57%"><font style="font: 10pt Times New Roman, Times, Serif">Operating cash flows from operating leases (1)</font></td>
<td style="width: 2%"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">579,770</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 17%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td style="width: 1%"> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Supplemental balance sheet and other information
related to operating leases are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">March 31, 2020</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 58%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating leases right-of-use assets</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font-size: 10pt">606,897</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 18%; text-align: right"><font style="font-size: 10pt">738,453</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Lease liability, current portion</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">402,876</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">453,734</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Lease liability, net of current portion</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">221,710</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">302,175</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total operating lease liabilities</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">624,586</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">755,909</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Weighted average remaining lease term</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">2.16 years</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">2.25 years</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Weighted average discount rate</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.75</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">%</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.75</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">%</font></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Supplemental balance sheet and other information
related to operating leases are as follows (1):</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Operating leases:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 76%; padding-bottom: 2.5pt"><font style="font-size: 10pt">Operating leases right-of-use assets</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; width: 21%; text-align: right"><font style="font-size: 10pt">738,453</font></td>
<td style="width: 1%; padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Lease liability, current</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">453,734</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Lease liability, net of current portion</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">302,175</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total operating lease liabilities</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">755,909</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Weighted average remaining lease term</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">2.2 years</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Weighted average discount rate</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">7.75%</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 24px; text-align: justify"> </td>
<td style="width: 24px; text-align: justify"><font style="font-size: 10pt">(1)</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">There is no comparable information for operating leases at or for the year ended December 31, 2018 since the Company adopted ASU No. 2016-02 on January 1, 2019 and elected to recognize operating lease right-of-use assets and operating lease liabilities at the adoption date.</font></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Financial assets and liabilities carried at
fair value as of March 31, 2020 and December 31, 2019 are classified in the tables below in one of the three categories:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Fair Value Measurement at <br />
March 31, 2020 (1)</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Using <br />
Level 3</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Total</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 62%; padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Liability - Warrants</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 16%; text-align: right"><font style="font-size: 10pt">140,877</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 16%; text-align: right"><font style="font-size: 10pt">140,877</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">79,045</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">79,045</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Fair Value Measurement at <br />
December 31, 2019 (1)</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Using <br />
Level 3</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Total</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 62%; padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Liability - Warrants</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 16%; text-align: right"><font style="font-size: 10pt">315,855</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 16%; text-align: right"><font style="font-size: 10pt">315,855</font></td>
<td style="width: 1%; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt; padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">267,399</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">267,399</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">(1) The Company did not have any assets or
liabilities measured at fair value using Level 1 or 2 of the fair value hierarchy as of March 31, 2020 and December 31, 2019.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Financial assets and liabilities carried at
fair value as of December 31, 2019 are classified in the table below in one of the three categories described in Note 2:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Fair Value Measurement at<br />
December 31, 2019 (1)</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Using<br />
Level 3</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Total</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 52%; padding-left: 10pt"><font style="font: 10pt Times New Roman, Times, Serif">Derivative Liability - Warrants</font></td>
<td style="width: 2%"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 20%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">315,855</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="border-bottom: black 1.5pt solid; width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 1.5pt solid; width: 20%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">315,855</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font: 10pt Times New Roman, Times, Serif">Derivative Put Liability</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">267,399</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">267,399</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">(1) The Company did not have any assets or
liabilities measured at fair value using Level 1 or 2 of the fair value hierarchy as of December 31, 2018 or 2019.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The following is a
reconciliation of the beginning and ending balances for the liability measured at fair value on a recurring basis using significant
unobservable inputs (Level 3) during the three months ended March 31, 2020 and the year ended December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font-size: 10pt"><b>Derivative Liability - Warrants</b></font></td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 77%"><font style="font-size: 10pt">Balance at December 31, 2019</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">315,855</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Fair value adjustments</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(174,978</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Balance at March 31, 2020</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">140,877</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td><font style="font-size: 10pt"><b>Redemption Put Liability</b></font></td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 77%"><font style="font-size: 10pt">Balance at December 31, 2019</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">267,399</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Issuance of Series D Convertible Preferred Stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">5,305</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Fair value adjustments</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(193,659</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Balance at March 31, 2020</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">79,045</font></td>
<td style="padding-bottom: 2.5pt"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The following is a
reconciliation of the beginning and ending balances for the liability measured at fair value on a recurring basis using significant
unobservable inputs (Level 3) during the year ended December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Derivative Liability- Warrants</b></font></td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 79%"><font style="font: 10pt Times New Roman, Times, Serif">January 8, 2019 - date of dilutive financing</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 17%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,215,678</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Exchange for common stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(72,563</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Fair value adjustments</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(827,260</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Balance at December 31, 2019</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">315,855</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"><b> </b></p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Redemption Put Liability</b></font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="text-align: justify"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 79%; padding-left: 12pt; text-align: justify; text-indent: -12pt"><font style="font: 10pt Times New Roman, Times, Serif">November 15, 2019 - date of issuance</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 17%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">614,095</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Fair value adjustments</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(346,696</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Balance at December 31, 2019</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">267,399</font></td>
<td> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Based upon the above accounting conclusions
and the additional information provided below, the allocation of the proceeds arising from the Series D Preferred financing transaction
is summarized in the table below:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">November 21, 2019 Series D Convertible Preferred and warrant financing:</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Proceeds Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Financing Cost Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Total Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 49%"><font style="font-size: 10pt">Gross proceeds</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Financing costs paid in cash</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">5,888,017</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Derivative Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(614,095</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(614,095</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Deferred Financing costs</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">8,100</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">8,100</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Redeemable preferred stock:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Series D Convertible Preferred Stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2,869,854</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2,869,854</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Financing costs (APIC)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,106</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,106</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Financing costs (Retained Earnings)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">66,265</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">66,265</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Beneficial Conversion Feature</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(623,045</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(623,045</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Investor Warrants (equity classified):</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Proceeds allocation</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1,893,006</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1,893,006</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Financing costs (APIC)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">36,512</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">36,512</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(6,000,000</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">111,983</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(5,888,017</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr>
</table>
<p style="margin: 0pt"> </p>
<p style="margin: 0pt"></p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">January 17, 2020 Series D Convertible Preferred and warrant financing:</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Proceeds Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 76%"><font style="font-size: 10pt">Gross proceeds</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 21%; text-align: right"><font style="font-size: 10pt">100,000</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Financing costs paid in cash</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">100,000</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Derivative Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(5,305</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Redeemable preferred stock:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Series D Convertible Preferred Stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(62,793</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Investor Warrants (equity classified):</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Proceeds allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(31,902</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(100,000</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Based upon the above accounting conclusions
and the additional information provided below, the allocation of the proceeds arising from the Series D Preferred financing transaction
is summarized in the table below:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">October 18, 2019 Series D Convertible Preferred and warrant financing:</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Proceeds Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Financing Cost Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Total Allocation</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 49%"><font style="font-size: 10pt">Gross proceeds</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Financing costs paid in cash</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">6,000,000</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(111,983</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(5,888,017</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Derivative Liability:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Derivative Put Liability</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(614,095</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">(614,095</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Deferred Financing costs</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">8,100</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">8,100</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Redeemable preferred stock:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Series D Convertible Preferred Stock</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2,869,854</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2,869,854</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Financing costs (APIC)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,106</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1,106</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Financing costs (Retained Earnings)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">66,265</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">66,265</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Beneficial Conversion Feature</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(623,045</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(623,045</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Investor Warrants (equity classified):</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-left: 10pt"><font style="font-size: 10pt">Proceeds allocation</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1,893,006</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1,893,006</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Financing costs (APIC)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">36,512</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">36,512</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(6,000,000</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">111,983</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(5,888,017</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr>
</table>
<p style="margin: 0pt"></p>
Each location has its own expiration date ranging from April 30, 2020 to August 31, 2023.
Each location has its own expiration date ranging from April 30, 2020 to August 31, 2023.
624586
0.0775
818924
680384
63015
55798
18300
24639
84939
607000
2944000
2944000
3000
8025
90137
6111
11153
0.55
0.55
70000
302710
158000
755216
99017
598119
57813
267
398000
1645399
24500000
10811908
9800000
8400000
24717270
2312500
27029770
0.40
2220000
350000
12681908
145757
131455
46153
30393
2751
3680000
12564401
16298200
1215677
12681908
4500
7500
7500
5000
5000
10000
15000
0
0
0
0
0
0
7000000
7000000
7000000
7000000
7100000
130085
52033
1690000
95000
95000
89000
600
33000
623000
623045
33000
425000
726557
425000
250000
250000
80725
382282
1.38
2.78
2.78
0.40
0.40
1.52
2.86
P7Y8M16D
P0Y
P0Y
0.75
0.75
0.75
In conjunction with the Series D Preferred financing (See Note 14), the Company offered the Series B warrant holders the option to exchange their warrants on the basis of 1 warrant for 0.40 common shares.
In conjunction with the Series D Preferred financing (See Note 14), the Company offered the Series B warrant holders the option to exchange their warrants on the basis of 1 warrant for .40 common shares.
1007813
1007813
79000
267000
614000
193659
346696
174978
827260
-174978
-827260
-193659
-346696
315855
267399
614095
0.051
0.13
0.40
0.40
1.58
1.59
0.17
156
143
154
0.00
0.00
0.019
0.056
0.20409
0.20409
0.70
1.92
95
92
0.00
0.00
50
50
0.23
166
0.40
0.40
2.57
115
0.00
0.118
0.20409
1.84
90
0.00
P2Y0M7D
P1Y4M2D
P1Y1M2D
P9Y8M12D
P9Y10M25D
P1Y9M7D
P3Y
P10Y
P4Y7M10D
P2Y7M17D
P4Y7M2D
0.78
1.00
0.78
14669757
840000
0.08
0.08
0.08
3130146
6000000
100000
50000
60493
158147
6000000
600000
100000
6000000
600000
-614095
-614095
-5305
-614095
-614095
8100
8100
8100
8100
-2869854
-2869854
-62793
-2869854
-2869854
1106
1106
1106
1106
66265
66265
66265
66265
-623045
-623045
-623045
-623045
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The Company estimated
the fair value of the Trigger Event Warrant portion of the redemption put liability using the following assumptions on March 31,
2020 and December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">March 31, 2020</font></td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td colspan="2" style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td colspan="2" style="text-align: center"> </td>
<td style="text-align: center"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 58%"><font style="font-size: 10pt">Fair value of underlying stock</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">0.019</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">0.056</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Exercise price</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.20409</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.20409</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Risk free rate</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">0.70</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.92</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected term (in years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">9.7</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">9.9</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Stock price volatility</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">95</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">92</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">— </font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">— </font></td>
<td></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company estimated the fair value of the
warrant derivative liability as of March 31, 2020 and December 31, 2019, respectively, using the following assumptions:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">March 31, 2020</font></td>
<td style="text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="text-align: center"> </td></tr>
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td colspan="2" style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td style="text-align: center"> </td>
<td colspan="2" style="text-align: center"> </td>
<td style="text-align: center"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 58%"><font style="font-size: 10pt">Fair value of underlying stock</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">0.051</font></td>
<td style="width: 1%; text-align: right"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 18%; text-align: right"><font style="font-size: 10pt">0.13</font></td>
<td style="width: 1%; text-align: right"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Exercise price</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="text-align: right"> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="text-align: right"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Risk free rate</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">0.17 – 0.23</font></td>
<td style="text-align: right"><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.58 – 1.59</font></td>
<td style="text-align: right"><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected term (in years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.09 – 1.77</font></td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.34 – 2.02</font></td>
<td style="text-align: right"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Stock price volatility</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">156 – 166</font></td>
<td style="text-align: right"><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">143 - 154</font></td>
<td style="text-align: right"><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">— </font></td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">— </font></td>
<td style="text-align: right"></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The Company estimated
the fair value of the warrant derivative liability as of the date they were accounted for as liabilities (assumed in Merger as
of January 8, 2019) and December 31, 2019, respectively, using the following assumptions:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">January 8, 2019</font></td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt; text-align: center"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 54%"><font style="font-size: 10pt">Fair value of underlying stock</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">0.13</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Exercise price</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.40</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Risk free rate</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2.57</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.58-1.59%</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected term (years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">3.00</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.34-2.02</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Stock price volatility</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">115</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">143-154%</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The Company estimated
the fair value of the Trigger Event Warrant portion of the redemption put liability using the following assumptions on the closing
date of November 15, 2019 and December 31, 2019:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">November 15, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">December 31, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 54%"><font style="font-size: 10pt">Fair value of underlying stock</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">0.118</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 20%; text-align: right"><font style="font-size: 10pt">0.056</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Exercise price</font></td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.20409</font></td>
<td> </td>
<td> </td>
<td><font style="font-size: 10pt">$</font></td>
<td style="text-align: right"><font style="font-size: 10pt">0.20409</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Risk free rate</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.84</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.92</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected term (in years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">10.0</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">9.9</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Stock price volatility</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">90</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">92</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">—</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Likelihood of redemption</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">50</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">50</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
</table>
<p style="margin: 0pt"></p>
111983
111983
111983
111983
-6000000
6000000
111983
-111983
5888017
5888017
-100000
100000
-6000000
6000000
111983
-111983
5888017
5888017
141000
119000
22000
22000
44806076
12108743
29608743
45319643
0.78
1.38
1092102
1165785
1113646
1187991
12564000
12564000
The two Notes are structured to convert into a larger offering of convertible debentures with a group of investors led by affiliates of the Investor, which is expected to close in the next thirty days. There can be no assurance that such offering will be consummated or that the Notes will convert.
While the note is dated April 29, 2020, the loan was not formally approved and funded until May 7, 2020.
158147
2916813
0.04
0
18750
225000
750000
9250
24717217
6466908
9
24717
6442182
5244780
5244780
-2050
512500
-2
513
-511
404384
-404384
32592
-32592
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
3 – Basis of presentation </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Based on the terms of the APA, the former RMS
members had voting control of the combined company as of the closing of the Merger. RMS is deemed to be the acquiring company for
accounting purposes and the transaction is accounted for as a reverse acquisition under the acquisition method of accounting for
business combinations in accordance with U.S. GAAP. The assets acquired and the liabilities assumed of RMS included as part of
the purchase transaction are recorded at historical cost. Accordingly, the assets and liabilities of H-CYTE are recorded as of
the Merger closing date at their estimated fair values.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying interim consolidated financial
statements have been prepared based upon U.S. Securities and Exchange Commission rules that permit reduced disclosure for interim
periods. Therefore, they do not include all information and footnote disclosures necessary for a complete presentation of the Company’s
financial position, results of operations and cash flows, in conformity with generally accepted accounting principles. The Company
filed audited consolidated financial statements as of and for the fiscal years ended December 31, 2019 and December 31, 2018 which
included all information and notes necessary for such complete presentation in conjunction with its 2019 Annual Report on Form
10-K.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The results of operations for the interim period
ended March 31, 2020 are not necessarily indicative of the results to be expected for any future period or the entire fiscal year.
These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements
for the year ended December 31, 2019, which are contained in the Company’s 2019 Annual Report on Form 10-K. For further discussion
of the Company’s significant accounting policies, refer to Note 3 – “Basis Of Presentation And Summary of Significant
Accounting Policies” to the consolidated financial statements and “Management’s Discussion and Analysis of Financial
Condition and Results of Operations – Critical Accounting Policies and Estimates” in the Company’s Annual Report
on Form 10-K for the fiscal year ended December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Certain reclassifications have been made to
amounts previously reported and some disclosures for prior periods have been added to conform with the current period presentation.</p>
557282
557282
P6Y11M26D
P6Y11M26D
353601
24639
24639
6060493
6060493
6281433
6281433
5305
0.04
0.40
4475634
250000
2450
250000
37207
5800
45533
0.25
-2538
17920
205
124118
667
2
665
1667
0
44806076
425000
38887847
425000
45319643
38308600
0.40
0.40
2023438
2023438
1.95
1.38
P7Y5M16D
P7Y8M26D
421250
695418
The loans bear interest ranging from 5.5% to 12%, in some cases increasing to 15% if not paid by the respective maturity date ranging from March 26, 2020 to May 13, 2020.
If any amounts payable under this Note are not paid within ten days after they are due, the interest rate shall accrue on the Principal in the amount of 18.0% per annum.
Some of these loans provided for the issuance of warrants at 114% warrant coverage if the loan was not repaid within two months.
Each Unit consisted of (i) a 12% senior secured convertible note, initially convertible into shares of the Company's common stock, par value $0.001 per share, at a conversion price equal to the lesser of $0.40 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock equivalents issued in future private placements of equity and/or debt securities completed by the Company following this offering of Units, and (ii) a three-year warrant to purchase such number of shares of the Company's common stock equal to one hundred percent (100%) of the number of shares of common stock issuable upon conversion of the notes at $0.40. The warrants are exercisable at a price equal to the lesser of $0.75 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock equivalents issued in future private placements of the debt and/or equity securities completed by the Company following the issuance of warrants. As a result of the price adjustment feature, the conversion price of the convertible notes was adjusted to $0.36 per share. The convertible notes had maturity dates between August and September 2019 totaling $650,000 (see Note 11).
Horne Management, LLC agreed to convert the related notes plus accrued interest into (i) 4,368,278 shares of common stock of the Company and (ii) a ten-year warrant to purchase up to an equivalent number of shares of the Company's common stock with such conversion to be effective as of April 17, 2020. This warrant will have an exercise price equal to the price per share at which securities are offered to investors for purchase at the Qualified Financing, which such price has not yet been established, and is exercisable beginning on the day immediately following the earlier to occur of (x) the closing of the Qualified Financing and (y) November 1, 2020. If the Qualified Financing does not occur on or prior to October 31, 2020, the exercise price of the warrant will be equal to the price per share obtained by dividing $3,000,000 by the number of fully diluted shares of the Company outstanding on October 31, 2020.
Horne Management, LLC agreed to convert the short-term notes, related parties totaling $1,635,000 as of March 31, 2020 plus accrued interest into (i) 4,368,278 shares of common stock of the Company and (ii) a ten-year warrant to purchase up to an equivalent number of shares of the Company's common stock with such conversion to be effective as of April 17, 2020. This warrant will have an exercise price equal to the price per share at which securities are offered to investors for purchase at the Qualified Financing, which such price has not yet been established, and is exercisable beginning on the day immediately following the earlier to occur of (x) the closing of the Qualified Financing and (y) November 1, 2020. If the Qualified Financing does not occur on or prior to October 31, 2020, the exercise price of the warrant will be equal to the price per share obtained by dividing $3,000,000 by the number of fully diluted shares of the Company outstanding on October 31, 2020.
0.40
0.40
0.40
22206
4306300
606595
15508401
66265
24717
9
12657182
12681908
24717270
9250
5258300
5258300
-132513
-132513
250000
250
99750
100000
403125
403
72160
72563
715279
-2650
716
-2
-714
-500
-1
-49999
-50000
50367
50
19376
19426
1667
2
665
667
287542
287542
32592
-32592
4225634
4226
1686028
1690254
106158
106158
623045
623045
-37618
-66265
-103883
85365
106158
22206
756350
184800
33805
19426
225937
72563
106158
56378
623045
17636
-56342
12000
1856350
50000
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
11 – Short-term Debt</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Convertible
note</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Convertible Notes payable represents a
securities purchase agreement with select accredited investors, which was assumed in the Merger. The debt assumed by the Company
consisted of $750,000 of units (the “Units”) with a purchase price of $50,000 per Unit. Each Unit consists of (i) a
12% senior secured convertible note, initially convertible into shares of the Company’s common stock, par value $0.001 per
share, at a conversion price equal to the lesser of $0.40 or ninety percent (90%) of the per share purchase price of any shares
of common stock or common stock equivalents issued in future private placements of equity and/or debt securities completed by the
Company following this offering, and (ii) a three-year warrant to purchase such number of shares of the Company’s common
stock equal to one hundred percent (100%) of the number of shares of common stock issuable upon conversion of the notes at $0.40.
The Warrants were initially exercisable at a price equal to the lesser of $0.75 or ninety percent (90%) of the per share purchase
price of any shares of common stock or common stock equivalents issued in future private placements of the debt and/or equity securities
completed by the Company following the issuance of warrants. The Convertible Notes are secured by all of the assets of the Company.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Convertible Notes sold in the offering
were initially convertible into an aggregate of 1,875,000 shares of common stock. The down round feature was triggered on January
8, 2019, and the conversion price of the Convertible Notes was adjusted to $0.36. The Company recognized the down round as a deemed
dividend of approximately $288,000 which reduced the income available to common stockholders.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 6, 2019, $100,000 of the Company’s
$750,000 outstanding Convertible Notes, plus accrued interest, was converted into an aggregate of 251,667 shares of common stock,
eliminating $100,000 of the Company’s debt obligation. The debt was converted into shares at $0.36 per share, which was the
conversion price per the SPA subsequent to the trigger of the down round feature. In 2019, the Company redeemed $350,000 of convertible
notes payable in principal and $52,033 in interest payable for three of the noteholders.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company also reached an extension with
the remaining noteholder which extended the maturity date of the loan for one year, until September 30, 2020. This note had a principal
balance of $300,000 plus penalties of approximately $85,000 and accrued interest of approximately $40,000 for a total adjusted
principal balance upon renewal of approximately $425,000 as of March 31, 2020 and December 31, 2019. Additionally, approximately
424,000 warrants were issued on September 15, 2019 in connection with the extension of the note.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Notes
Payable</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Notes payable were assumed in the Merger and
are due in aggregate monthly installments of approximately $5,800 and carry an interest rate of 5%. Each note originally had a
maturity date of August 1, 2019. The Company finalized an eighteen-month extension to March 1, 2021. The promissory notes have
an aggregate outstanding balance of approximately $67,000 and $78,000 at March 31, 2020 and December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On March 27, 2020, the Company issued a Note
in the principal amount of $500,000 to the Investor for a total of $500,000 in exchange for a loan in such amount to cover working
capital needs. The Note bears an interest rate of 8.0% per annum and is due on demand. If any amounts payable under this Note
are not paid within ten days after they are due, the interest rate shall accrue on the Principal in the amount of 18.0% per annum.
The Investor is an affiliate of a pre-existing shareholder of the Company having been the lead investor in the Company’s
recent Series D Convertible Preferred Stock Offering.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Principles
of Consolidation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">U.S. GAAP requires that a related entity be
consolidated with a company when certain conditions exist. An entity is considered to be a VIE when it has equity investors who
lack the characteristics of having a controlling financial interest, or its capital is insufficient to permit it to finance its
activities without additional subordinated financial support. Consolidation of a VIE by the Parent would be required if it is determined
that the Parent will absorb a majority of the VIE’s expected losses or residual returns if they occur, retain the power to
direct or control the VIE’s activities, or both.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying audited consolidated financial
statements include the accounts of the Parent, its wholly owned subsidiaries, and its VIEs. All intercompany accounts
and transactions have been eliminated in consolidation.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Use
of Estimates</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In preparing the financial statements, U.S.
GAAP requires disclosure regarding estimates and assumptions used by management that affect the amounts reported in financial
statements and accompanying notes. Actual results could differ from those estimates.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Cash</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company considers all highly liquid investments
with original maturities of three months or less to be cash equivalents. The Company’s cash balances at December 31, 2019
and 2018 consists of funds deposited in checking accounts with commercial banks.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Accounts
Receivable</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Accounts receivable represent amounts due
from customers for which revenue has been recognized. Generally, the Company does not require collateral or any other security
to support its receivables. Trade accounts receivable are stated net of an estimate made for doubtful accounts, if any. Management
evaluates the adequacy of the allowance for doubtful accounts regularly to determine if any account balances will potentially
be uncollectible. Customer account balances are considered past due or delinquent based on the contractual agreement with each
customer. Accounts are written off when, in management’s judgment, they are considered uncollectible. At December 31, 2019
and December 31, 2018, management believes no allowance is necessary. For the year ended December 31, 2019 and 2018, the Company
recorded bad debt expense of approximately $90,000 and $3,000, respectively.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Impairment of Long-Lived Assets</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i> </i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company reviews the values assigned to
long-lived assets, including property and equipment and certain intangible assets, to determine whether events and circumstances
have occurred which indicate that the remaining estimated useful lives may warrant revision or that the remaining balances may
not be recoverable. The evaluation of asset impairment requires management to make assumptions about future cash flows over the
life of the asset being evaluated. These assumptions require significant judgment, and actual results may differ from estimated
amounts. In such reviews, undiscounted cash flows associated with these assets are compared with their carrying value to determine
if a write-down to fair value is required.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the year ended December 31, 2019 and 2018,
the Company recognized an impairment charge of approximately $2,944,000 and $607,000, respectively, related to certain intangible
assets (See Note 7).</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Goodwill</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill represents the excess of purchase
price over fair value of net identified tangible and intangible assets and liabilities acquired. The Company does not amortize
goodwill; it tests goodwill for impairment on at least an annual basis. An impairment loss, if any, is measured as the excess of
the carrying value of the reporting unit over the fair value of the reporting unit.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2019, the Company performed
a quantitative test and determined that the carrying value of the reporting unit exceeded the fair value. The Company’s
goodwill balance was determined to be impaired as of the balance sheet date due to the adverse financial results for 2019, the
negative projected cash results for 2020 and a significant decline in its market capitalization. As a result, we recorded a goodwill
impairment charge of approximately $12,564,000 during the year ended December 31, 2019 (See Note 7).</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Leases</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In February 2016, the Financial Accounting
Standard Board (“FASB”) established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02 (as
amended), which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements.
The new standard establishes a right-of-use (“ROU”) model that requires a lessee to recognize a ROU asset and lease
liability on the balance sheet for all leases with a term longer than twelve months. Leases will be classified as finance or operating,
with classification affecting the pattern and classification of expense recognition in the statement of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has not entered into significant
lease agreements in which it is the lessor. For the lease agreements in which the Company is lessee, under Topic 842, lessees
are required to recognize a lease liability and right-of-use asset for all leases (except for short-term leases) at the lease
commencement date. Effective January 1, 2019, the Company adopted this guidance, applied the modified retrospective transition
method and elected the transition option to use the effective date as the date of initial application. The Company recognized
the cumulative effect of the transition adjustment on the consolidated balance sheet as of the effective date and did not provide
any new lease disclosures for periods before the effective date. With respect to the practical expedients, the Company elected
the package of transitional-related practical expedients and the practical expedient not to separate lease and non-lease components.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Other
Receivables</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Other receivables totaling approximately $19,000
and $5,000 at December 31, 2019 and 2018, respectively include receivables from the non-acquired Lung Institute, LLC due to Lung
Institute Tampa, LLC for approximately $10,000 and $0, and approximately $9,000 and $5,000 reimbursement receivable for expenses
from RMS at December 31, 2019 and 2018, respectively. The $10,000 receivable was a result of the Lung Institute, LLC being a transitory
entity for Lung Institute Tampa, LLC while the merchant services accounts are being transferred.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Revenue
Recognition</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company recognizes revenue in accordance
with U.S. GAAP as outlined in the FASB ASC 606, <i>Revenue From Contracts with Customers</i>, which requires that five steps
be completed to determine when revenue can be recognized: (i) identify the contract with the customer; (ii) identity the performance
obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price; and (v) recognize revenue
when or as the entity satisfies a performance obligation. The Company records revenue under ASC 606 when control is transferred
to the customer.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company uses a standard pricing model for
the types of cellular therapy treatments that is offered to its patients. The transaction price accounts for medical, surgical,
facility, and office services rendered by the Company for consented procedures and is recorded as revenue. The Company recognizes
revenue when the terms of a contract with a patient are satisfied.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company offers two types of cellular therapy
treatments to their patients.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 24px; text-align: justify"> </td>
<td style="width: 24px; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">1)</font></td>
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The first type of treatment includes medical services rendered typically over a two-day period in which the patient receives cellular therapy. For this treatment type, revenue is recognized in full at time of service.</font></td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">2)</font></td>
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The Company also offers a four-day treatment in which medical services are rendered typically over a two-day period and then again, approximately three months later, medical services are rendered for an additional two days of treatment. Payment is collected in full for both service periods at the time the first treatment is rendered. Revenue is recognized when services are performed based on the estimated standalone selling price of each service. The Company has deferred recognition of revenue amounting to approximately $1,046,000 and $326,000 at December 31, 2019 and 2018, respectively.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify; text-indent: -0.25in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s policy is to not offer
refunds to patients. However, in limited instances the Company may make exceptions to this policy for extenuating circumstances.
These instances are evaluated on a case by case basis and may result in a patient refund. Management performed an analysis of
its customer refund history for refunds issued related to prior year’s revenue. Management used the results of this historical
refund analysis to record a reserve for anticipated future refunds related to recognized revenue. At December 31, 2019 and 2018,
the estimated allowance for refunds was approximately $63,000 and $0, respectively and is recorded in a contra revenue account.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Research
and development costs</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Research and development expenses are recorded
in operating expenses in the period in which they are incurred.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Advertising
</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Advertising costs are recorded in operating
expenses in the period in which they are incurred.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Stock-Based
Compensation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company maintains a stock option incentive
plan and accounts for stock-based compensation in accordance with ASC 718, <i>Compensation - Stock Compensation</i>. The
Company recognizes share-based compensation expense, net of an estimated forfeiture rate, over the requisite service period of
the award to employees and directors. As required by fair value provisions of share-based compensation, employee and non-employee
share-based compensation expense recognized is calculated over the requisite service period of the awards and reduced for estimated
forfeitures.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Income
Taxes</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company utilizes the liability method of
accounting for income taxes as set forth in FASB ASC Topic 740, “Income Taxes”. Under the liability method, deferred
taxes are determined based on temporary differences between the financial statement and tax bases of assets and liabilities using
tax rates expected to be in effect during the years in which the difference turns around. The Company accounts for interest
and penalties on income taxes as income tax expense. A valuation allowances is recorded when it is more likely than not that a
tax benefit will not be realized. In determining the need for valuation allowances the Company considers projected future taxable
income and the availability of tax planning strategies.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">From inception to December 31, 2019, the Company
has incurred net losses and, therefore, has no current income tax liability. The net deferred tax asset generated by these losses
is fully reserved as of December 31, 2019 and 2018, respectively, since it is currently likely that the benefit will not be realized
in future periods.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As a result of the acquisition, the Company
is required to file federal income tax returns and state income tax returns in the states of Arizona, Florida, Georgia, Minnesota,
Pennsylvania, Tennessee, and Texas. There are no uncertain tax positions at December 31, 2019 or December 31, 2018. The Company
has not undergone any tax examinations since inception.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Net
Loss Per Share</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Basic loss per share is computed on the basis
of the weighted average number of shares outstanding for the reporting period. Diluted loss per share is computed on the basis
of the weighted average number of common shares plus dilutive potential common shares outstanding using the treasury stock method.
Any potentially dilutive securities are antidilutive due to the Company’s net losses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the periods presented, there is no difference
between the basic and diluted net loss per share: 44,806,076 warrants and 425,000 common stock options outstanding were considered
anti-dilutive and excluded for the year ending December 31, 2019. At December 31, 2019, the only potentially dilutive shares would
be from the conversion of the convertible debt and the conversion of preferred stock, Series B and Series D totaling 38,887,847
of common stock to be issued upon conversion of all these securities. There were no option or warrant exercises that would have
been potentially dilutive. For the year ended December 31, 2018, there were no dilutive securities as the accounting acquirer
did not historically have stock-based securities.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Fair
Value Measurements</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company measures certain non-financial
assets, liabilities, and equity issuances at fair value on a non-recurring basis. These non-recurring valuations include evaluating
assets such as long-lived assets and non-amortizing intangible assets for impairment; allocating value to assets in an acquired
asset group; and applying accounting for business combinations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company classified its stock warrants as
either liability or equity instruments in accordance with ASC 480, “Distinguishing Liabilities from Equity” (ASC 480)
and ASC 815, “Derivatives and Hedging” (ASC 815), depending on the specific terms of the warrant agreement. The Series
B Warrants included a down-round protection feature that would also result in the issuance of additional shares of stock, are classified
as liabilities pursuant to ASC 815 and are initially and subsequently measured at their estimated fair values. The Company will
continue to record liability-classified warrants at fair value until the warrants are exercised, expire or are amended in a way
that would no longer require these warrants to be classified as a liability. For additional discussion on the Series B Warrants,
see Note 12.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company classified a redemption provision
in its Series D Preferred Stock as a derivative liability in accordance with ASC 815. The Company will continue to record the redemption
provision as a “Redemption Put Liability” until the Series D is converted or redeemed. For additional discussion
on the Redemption Put Liability, see Note 12.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company uses the fair value measurement
framework to value these assets and report the fair values in the periods in which they are recorded, adjusted above, or written
down.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair value measurement framework includes
a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair values in their broad levels. These
levels from highest to lowest priority are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 48px; text-align: justify"> </td>
<td style="width: 24px; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">●</font></td>
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities;</font></td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">●</font></td>
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Level 2: Quoted prices in active markets for similar assets or liabilities or observable prices that are based on inputs not quoted on active markets, but corroborated by market data; and</font></td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">●</font></td>
<td style="text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Level 3: Unobservable inputs or valuation techniques that are used when little or no market data is available.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The determination of fair value and the assessment
of a measurement’s placement within the hierarchy requires judgment. Level 3 valuations often involve a higher degree of
judgment and complexity. Level 3 valuations may require the use of various cost, market, or income valuation methodologies applied
to unobservable management estimates and assumptions. Management’s assumptions could vary depending on the asset or liability
valued and the valuation method used. Such assumptions could include estimates of prices, earnings, costs, actions of market participants,
market factors, or the weighting of various valuation methods. The Company may also engage external advisors to assist us in determining
fair value, as appropriate.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company evaluates its financial liabilities
subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each
reporting period. This determination requires significant judgments to be made. Although the Company believes that the recorded
fair value of our financial instruments is appropriate at December 31, 2019, these fair values may not be indicative of net realizable
value or reflective of future fair values. There were no financial assets or liabilities carried at fair value as of December
31, 2018.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following schedule represents the amount
of revenue and net loss attributable to the MedoveX acquisition which have been included in the consolidated statements of operations
for the periods subsequent to the acquisition date:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the Year Ended</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">December 31, 2019</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 81%"><font style="font: 10pt Times New Roman, Times, Serif">Revenues</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">67,631</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Net loss attributable to MedoveX</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(4,754,680</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The pro forma results do not necessarily reflect
the actual results of operations of the combined companies under the current ownership and operation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the Year Ended December 31, 2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">RMS</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">MedoveX</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Pro Forma</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 55%"><font style="font: 10pt Times New Roman, Times, Serif">Revenues</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 12%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7,883,115</font></td>
<td style="width: 1%"> </td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 11%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">818,211</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 11%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">8,701,326</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Net loss</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(4,394,149</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(4,908,644</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(9,302,793</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Net loss attributable to common shareholders</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(4,394,149</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(5,477,873</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(9,872,022</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Loss per share- basic and diluted</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(0.13</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(0.23</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(0.17</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A reconciliation of the statutory federal income
tax expense (benefit) to the effective tax is as follows for the years ended December 31:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2018</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 72%"><font style="font-size: 10pt">Statutory rate – federal</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 11%; text-align: right"><font style="font-size: 10pt">21.0</font></td>
<td style="width: 1%"><font style="font-size: 10pt">%</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 11%; text-align: right"><font style="font-size: 10pt">21.0</font></td>
<td style="width: 1%"><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Effect of:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">State income tax, net of federal benefit</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">3.0</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">5.0</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">State NOL true-up</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2.0</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Goodwill impairment</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(9.0</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Other permanent differences</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1.0</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Change in valuation allowances</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(13.0</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(25.0</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Income taxes</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">0.0</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">%</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">0.0</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">%</font></td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Deferred tax assets and liabilities consist
of the following at December 31:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2018</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt"><b>Deferred Tax Assets:</b></font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 66%"><font style="font-size: 10pt">Federal and state net operating loss carryforwards</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">7,302,375</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">666,888</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Capitalized start-up costs</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2,483,736</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">154,791</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Capitalized research and development costs</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">424,390</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Patents</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">57,907</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Share-based compensation</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">242,437</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Other</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">25,405</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">81,801</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Total gross deferred tax assets</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">10,536,250</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">903,480</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt"><b>Valuation Allowance</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(10,536,250</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(903,480</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt; padding-left: 10pt"><font style="font-size: 10pt">Net deferred tax assets</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="margin: 0pt"></p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
3 – Basis Of Presentation And Summary of Significant Accounting Policies</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Based on the terms of the APA, the former RMS
members had voting control of the combined company as of the closing of the Merger. RMS is deemed to be the acquiring company for
accounting purposes and the transaction is accounted for as a reverse acquisition under the acquisition method of accounting for
business combinations in accordance with U.S. GAAP. The assets acquired and the liabilities assumed of RMS included as part of
the purchase transaction are recorded at historical cost. Accordingly, the assets and liabilities of H-CYTE are recorded as of
the Merger closing date at their estimated fair values.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The audited consolidated balance sheets, consolidated
statements of operations, consolidated statements of stockholders’ deficit, and the consolidated statements of cash flows
do not reflect the historical financial information related to H-CYTE prior to the Merger as they only reflect the historical financial
information related to RMS. For the audited consolidated statements of stockholders’ deficit, the common stock, preferred
stock, and additional paid in capital reflect the accounting for the stock received by the RMS members as of the Merger as if it
was received at the beginning of the periods presented.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Principles
of Consolidation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">U.S. GAAP requires that a related entity be
consolidated with a company when certain conditions exist. An entity is considered to be a VIE when it has equity investors who
lack the characteristics of having a controlling financial interest, or its capital is insufficient to permit it to finance its
activities without additional subordinated financial support. Consolidation of a VIE by the Parent would be required if it is determined
that the Parent will absorb a majority of the VIE’s expected losses or residual returns if they occur, retain the power to
direct or control the VIE’s activities, or both.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The accompanying audited consolidated financial
statements include the accounts of the Parent, its wholly owned subsidiaries, and its VIEs. All intercompany accounts and transactions
have been eliminated in consolidation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Use
of Estimates</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In preparing the financial statements, U.S.
GAAP requires disclosure regarding estimates and assumptions used by management that affect the amounts reported in financial statements
and accompanying notes. Actual results could differ from those estimates.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Cash</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company considers all highly liquid investments
with original maturities of three months or less to be cash equivalents. The Company’s cash balances at December 31, 2019
and 2018 consists of funds deposited in checking accounts with commercial banks.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Accounts
Receivable</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Accounts receivable represent amounts due from
customers for which revenue has been recognized. Generally, the Company does not require collateral or any other security to support
its receivables. Trade accounts receivable are stated net of an estimate made for doubtful accounts, if any. Management evaluates
the adequacy of the allowance for doubtful accounts regularly to determine if any account balances will potentially be uncollectible.
Customer account balances are considered past due or delinquent based on the contractual agreement with each customer. Accounts
are written off when, in management’s judgment, they are considered uncollectible. At December 31, 2019 and December 31,
2018, management believes no allowance is necessary. For the year ended December 31, 2019 and 2018, the Company recorded bad debt
expense of approximately $90,000 and $3,000, respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Impairment of Long-Lived Assets</i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i> </i></b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company reviews the values assigned to
long-lived assets, including property and equipment and certain intangible assets, to determine whether events and circumstances
have occurred which indicate that the remaining estimated useful lives may warrant revision or that the remaining balances may
not be recoverable. The evaluation of asset impairment requires management to make assumptions about future cash flows over the
life of the asset being evaluated. These assumptions require significant judgment, and actual results may differ from estimated
amounts. In such reviews, undiscounted cash flows associated with these assets are compared with their carrying value to determine
if a write-down to fair value is required.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the year ended December 31, 2019 and 2018,
the Company recognized an impairment charge of approximately $2,944,000 and $607,000, respectively, related to certain intangible
assets (See Note 7).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Goodwill</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill represents the excess of purchase
price over fair value of net identified tangible and intangible assets and liabilities acquired. The Company does not amortize
goodwill; it tests goodwill for impairment on at least an annual basis. An impairment loss, if any, is measured as the excess of
the carrying value of the reporting unit over the fair value of the reporting unit.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2019, the Company performed
a quantitative test and determined that the carrying value of the reporting unit exceeded the fair value. The Company’s goodwill
balance was determined to be impaired as of the balance sheet date due to the adverse financial results for 2019, the negative
projected cash results for 2020 and a significant decline in its market capitalization. As a result, we recorded a goodwill impairment
charge of approximately $12,564,000 during the year ended December 31, 2019 (See Note 7).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Leases</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In February 2016, the Financial Accounting
Standard Board (“FASB”) established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02 (as
amended), which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements.
The new standard establishes a right-of-use (“ROU”) model that requires a lessee to recognize a ROU asset and lease
liability on the balance sheet for all leases with a term longer than twelve months. Leases will be classified as finance or operating,
with classification affecting the pattern and classification of expense recognition in the statement of operations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has not entered into significant
lease agreements in which it is the lessor. For the lease agreements in which the Company is lessee, under Topic 842, lessees are
required to recognize a lease liability and right-of-use asset for all leases (except for short-term leases) at the lease commencement
date. Effective January 1, 2019, the Company adopted this guidance, applied the modified retrospective transition method and elected
the transition option to use the effective date as the date of initial application. The Company recognized the cumulative effect
of the transition adjustment on the consolidated balance sheet as of the effective date and did not provide any new lease disclosures
for periods before the effective date. With respect to the practical expedients, the Company elected the package of transitional-related
practical expedients and the practical expedient not to separate lease and non-lease components.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Other
Receivables</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Other receivables totaling approximately $19,000
and $5,000 at December 31, 2019 and 2018, respectively include receivables from the non-acquired Lung Institute, LLC due to Lung
Institute Tampa, LLC for approximately $10,000 and $0, and approximately $9,000 and $5,000 reimbursement receivable for expenses
from RMS at December 31, 2019 and 2018, respectively. The $10,000 receivable was a result of the Lung Institute, LLC being a transitory
entity for Lung Institute Tampa, LLC while the merchant services accounts are being transferred.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Revenue
Recognition</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company recognizes revenue in accordance
with U.S. GAAP as outlined in the FASB ASC 606, <i>Revenue From Contracts with Customers</i>, which requires that five steps be
completed to determine when revenue can be recognized: (i) identify the contract with the customer; (ii) identity the performance
obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price; and (v) recognize revenue
when or as the entity satisfies a performance obligation. The Company records revenue under ASC 606 when control is transferred
to the customer.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company uses a standard pricing model for
the types of cellular therapy treatments that is offered to its patients. The transaction price accounts for medical, surgical,
facility, and office services rendered by the Company for consented procedures and is recorded as revenue. The Company recognizes
revenue when the terms of a contract with a patient are satisfied.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company offers two types of cellular therapy
treatments to their patients.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 24px; text-align: justify"> </td>
<td style="width: 24px; text-align: justify"><font style="font-size: 10pt">1)</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">The first type of treatment includes medical services rendered typically over a two-day period in which the patient receives cellular therapy. For this treatment type, revenue is recognized in full at time of service.</font></td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"><font style="font-size: 10pt">2)</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">The Company also offers a four-day treatment in which medical services are rendered typically over a two-day period and then again, approximately three months later, medical services are rendered for an additional two days of treatment. Payment is collected in full for both service periods at the time the first treatment is rendered. Revenue is recognized when services are performed based on the estimated standalone selling price of each service. The Company has deferred recognition of revenue amounting to approximately $1,046,000 and $326,000 at December 31, 2019 and 2018, respectively.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify; text-indent: -0.25in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s policy is to not offer
refunds to patients. However, in limited instances the Company may make exceptions to this policy for extenuating circumstances.
These instances are evaluated on a case by case basis and may result in a patient refund. Management performed an analysis of its
customer refund history for refunds issued related to prior year’s revenue. Management used the results of this historical
refund analysis to record a reserve for anticipated future refunds related to recognized revenue. At December 31, 2019 and 2018,
the estimated allowance for refunds was approximately $63,000 and $0, respectively and is recorded in a contra revenue account.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Research
and development costs</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Research and development expenses are recorded
in operating expenses in the period in which they are incurred.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Advertising
</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i> </i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Advertising costs are recorded in operating
expenses in the period in which they are incurred.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Stock-Based
Compensation</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company maintains a stock option incentive
plan and accounts for stock-based compensation in accordance with ASC 718, <i>Compensation - Stock Compensation</i>. The Company
recognizes share-based compensation expense, net of an estimated forfeiture rate, over the requisite service period of the award
to employees and directors. As required by fair value provisions of share-based compensation, employee and non-employee share-based
compensation expense recognized is calculated over the requisite service period of the awards and reduced for estimated forfeitures.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Income
Taxes</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company utilizes the liability method of
accounting for income taxes as set forth in FASB ASC Topic 740, “Income Taxes”. Under the liability method, deferred
taxes are determined based on temporary differences between the financial statement and tax bases of assets and liabilities using
tax rates expected to be in effect during the years in which the difference turns around. The Company accounts for interest and
penalties on income taxes as income tax expense. A valuation allowances is recorded when it is more likely than not that a tax
benefit will not be realized. In determining the need for valuation allowances the Company considers projected future taxable income
and the availability of tax planning strategies.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">From inception to December 31, 2019, the Company
has incurred net losses and, therefore, has no current income tax liability. The net deferred tax asset generated by these losses
is fully reserved as of December 31, 2019 and 2018, respectively, since it is currently likely that the benefit will not be realized
in future periods.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As a result of the acquisition, the Company
is required to file federal income tax returns and state income tax returns in the states of Arizona, Florida, Georgia, Minnesota,
Pennsylvania, Tennessee, and Texas. There are no uncertain tax positions at December 31, 2019 or December 31, 2018. The Company
has not undergone any tax examinations since inception.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Net
Loss Per Share</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Basic loss per share is computed on the basis
of the weighted average number of shares outstanding for the reporting period. Diluted loss per share is computed on the basis
of the weighted average number of common shares plus dilutive potential common shares outstanding using the treasury stock method.
Any potentially dilutive securities are antidilutive due to the Company’s net losses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the periods presented, there is no difference
between the basic and diluted net loss per share: 44,806,076 warrants and 425,000 common stock options outstanding were considered
anti-dilutive and excluded for the year ending December 31, 2019. At December 31, 2019, the only potentially dilutive shares would
be from the conversion of the convertible debt and the conversion of preferred stock, Series B and Series D totaling 38,887,847
of common stock to be issued upon conversion of all these securities. There were no option or warrant exercises that would have
been potentially dilutive. For the year ended December 31, 2018, there were no dilutive securities as the accounting acquirer did
not historically have stock-based securities.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b><i>Fair
Value Measurements</i></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company measures certain non-financial
assets, liabilities, and equity issuances at fair value on a non-recurring basis. These non-recurring valuations include evaluating
assets such as long-lived assets and non-amortizing intangible assets for impairment; allocating value to assets in an acquired
asset group; and applying accounting for business combinations.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company classified its stock warrants as
either liability or equity instruments in accordance with ASC 480, “Distinguishing Liabilities from Equity” (ASC 480)
and ASC 815, “Derivatives and Hedging” (ASC 815), depending on the specific terms of the warrant agreement. The Series
B Warrants included a down-round protection feature that would also result in the issuance of additional shares of stock, are classified
as liabilities pursuant to ASC 815 and are initially and subsequently measured at their estimated fair values. The Company will
continue to record liability-classified warrants at fair value until the warrants are exercised, expire or are amended in a way
that would no longer require these warrants to be classified as a liability. For additional discussion on the Series B Warrants,
see Note 12.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company classified a redemption provision
in its Series D Preferred Stock as a derivative liability in accordance with ASC 815. The Company will continue to record the redemption
provision as a “Redemption Put Liability” until the Series D is converted or redeemed. For additional discussion on
the Redemption Put Liability, see Note 12.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company uses the fair value measurement
framework to value these assets and report the fair values in the periods in which they are recorded, adjusted above, or written
down.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The fair value measurement framework includes
a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair values in their broad levels. These
levels from highest to lowest priority are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 48px; text-align: justify"> </td>
<td style="width: 24px; text-align: justify"><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities;</font></td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">Level 2: Quoted prices in active markets for similar assets or liabilities or observable prices that are based on inputs not quoted on active markets, but corroborated by market data; and</font></td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td>
<td style="text-align: justify"> </td></tr>
<tr style="vertical-align: top">
<td style="text-align: justify"> </td>
<td style="text-align: justify"><font style="font-size: 10pt">●</font></td>
<td style="text-align: justify"><font style="font-size: 10pt">Level 3: Unobservable inputs or valuation techniques that are used when little or no market data is available.</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The determination of fair value and the assessment
of a measurement’s placement within the hierarchy requires judgment. Level 3 valuations often involve a higher degree of
judgment and complexity. Level 3 valuations may require the use of various cost, market, or income valuation methodologies applied
to unobservable management estimates and assumptions. Management’s assumptions could vary depending on the asset or liability
valued and the valuation method used. Such assumptions could include estimates of prices, earnings, costs, actions of market participants,
market factors, or the weighting of various valuation methods. The Company may also engage external advisors to assist us in determining
fair value, as appropriate.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company evaluates its financial liabilities
subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each
reporting period. This determination requires significant judgments to be made. Although the Company believes that the recorded
fair value of our financial instruments is appropriate at December 31, 2019, these fair values may not be indicative of net realizable
value or reflective of future fair values. There were no financial assets or liabilities carried at fair value as of December
31, 2018.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
11 –Debt</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Convertible Notes payable represents a
securities purchase agreement with select accredited investors, which was assumed in the Merger. The debt assumed by the Company
consisted of $750,000 of units (the “Units”) with a purchase price of $50,000 per Unit. Each Unit consists of (i) a
12% senior secured convertible note, initially convertible into shares of the Company’s common stock, par value $0.001 per
share, at a conversion price equal to the lesser of $0.40 or ninety percent (90%) of the per share purchase price of any shares
of common stock or common stock equivalents issued in future private placements of equity and/or debt securities completed by the
Company following this offering, and (ii) a three-year warrant to purchase such number of shares of the Company’s common
stock equal to one hundred percent (100%) of the number of shares of common stock issuable upon conversion of the notes at $0.40.
The Warrants were initially exercisable at a price equal to the lesser of $0.75 or ninety percent (90%) of the per share purchase
price of any shares of common stock or common stock equivalents issued in future private placements of the debt and/or equity securities
completed by the Company following the issuance of warrants. The Convertible Notes are secured by all of the assets of the Company.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Convertible Notes sold in the offering
were initially convertible into an aggregate of 1,875,000 shares of common stock. The down round feature was triggered on January
8, 2019, and the conversion price of the Convertible Notes was adjusted to $0.36. The Company recognized the down round as a deemed
dividend of approximately $288,000 which reduced the income available to common stockholders.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 6, 2019, $100,000 of the Company’s
$750,000 outstanding Convertible Notes, plus accrued interest, was converted into an aggregate of 251,667 shares
of common stock, eliminating $100,000 of the Company’s debt obligation. The debt was converted into shares at $0.36 per share,
which was the conversion price per the SPA subsequent to the trigger of the down round feature.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The convertible notes had maturity dates between
August and September 2019. In November 2019 the Company redeemed $350,000 of convertible notes payable in principal and $52,033
in interest payable for three of the noteholders. The Company also recognized an additional $80,225 in penalties and late fees
in relation to these notes for the year ended December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company also reached an extension with
the remaining noteholder which extended the maturity date of the loan for one year, until September 30, 2020. This note had a principal
balance of $300,000 plus penalties of approximately $85,000 and accrued interest of approximately $40,000 for a total adjusted
principal balance upon renewal of approximately $425,000 for the year ending December 31, 2019. Additionally, approximately 424,000
warrants were issued in connection with the extension of the note. The fair market value of the warrants on September 18, 2019,
the day the warrants were issued, was approximately $106,000, which the Company recognized as an expense for the year ending December
31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Notes payable were assumed in the Merger and
are due in aggregate monthly installments of approximately $5,800 and carry an interest rate of 5%. Each note originally had a
maturity date of August 1, 2019. The Company finalized an eighteen-month extension to March 1, 2021. The promissory notes have
an aggregate outstanding balance of approximately $78,000 at December 31, 2019. The Company incurred interest expense related
to the promissory notes for the year ended December 31, 2019 in the amount of approximately $2,000; no interest expense was incurred
during 2018 as these notes were assumed on January 8, 2019.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b>Note
15 - Income Taxes</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company utilizes the liability method of
accounting for income taxes as set forth in FASB ASC Topic 740, “Income Taxes”. Under the liability method, deferred
taxes are determined based on temporary differences between the financial statement and tax bases of assets and liabilities using
tax rates expected to be in effect during the years in which the basis difference reverses. The Company accounts for interest and
penalties on income taxes as income tax expense. A valuation allowances is recorded when it is more likely than not that a tax
benefit will not be realized. In determining the need for valuation allowances the Company considers projected future taxable income
and the availability of tax planning strategies.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><font style="font-variant: small-caps"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s policy is to record interest
and penalties on uncertain tax positions as a component of income tax expense. As of December 31, 2019, the Company has not incurred
any interest or penalties relating to uncertain tax positions.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the years ended December 31, 2019 and 2018,
the Company has incurred net losses and, therefore, has no current income tax liability and recognized no income tax expense. The
net deferred tax asset generated by these losses, which principally consist of operating losses deferred for income tax purposes,
is fully reserved as of December 31, 2019 and 2018 since it is more likely than not that the benefit will not be realized in future
periods.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">A reconciliation of the statutory federal income
tax expense (benefit) to the effective tax is as follows for the years ended December 31:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="text-align: center"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2018</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 72%"><font style="font-size: 10pt">Statutory rate – federal</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 11%; text-align: right"><font style="font-size: 10pt">21.0</font></td>
<td style="width: 1%"><font style="font-size: 10pt">%</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 11%; text-align: right"><font style="font-size: 10pt">21.0</font></td>
<td style="width: 1%"><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Effect of:</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">State income tax, net of federal benefit</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">3.0</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">5.0</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">State NOL true-up</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(2.0</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Goodwill impairment</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(9.0</font></td>
<td><font style="font-size: 10pt">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Other permanent differences</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">(1.0</font></td>
<td><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Change in valuation allowances</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(13.0</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(25.0</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Income taxes</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">0.0</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">%</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">0.0</font></td>
<td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">%</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s financial statements contain
certain deferred tax assets which have arisen primarily as a result of losses incurred that are considered startup costs for tax
purposes, as well as net deferred income tax assets resulting from other temporary differences related to certain reserves and
differences between book and tax depreciation and amortization. The Company records a valuation allowance against our net deferred
tax assets when we determine that based on the weight of available evidence, it is more likely than not that the net deferred tax
assets will not be realized.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Management of the Company evaluated the positive
and negative evidence bearing upon the realizability of its deferred tax assets and determined that it is more likely than not
that the Company will not recognize the benefits of the deferred tax assets. As a result, a full valuation allowance was recorded
as of December 31, 2019 and 2018.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Deferred tax assets and liabilities consist
of the following at December 31:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">2018</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt"><b>Deferred Tax Assets:</b></font></td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="width: 66%"><font style="font-size: 10pt">Federal and state net operating loss carryforwards</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">7,302,375</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font-size: 10pt">$</font></td>
<td style="width: 14%; text-align: right"><font style="font-size: 10pt">666,888</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Capitalized start-up costs</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2,483,736</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">154,791</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Capitalized research and development costs</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">424,390</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Patents</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">57,907</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Share-based compensation</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">242,437</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Other</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">25,405</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">81,801</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 1.5pt; padding-left: 10pt"><font style="font-size: 10pt">Total gross deferred tax assets</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">10,536,250</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">903,480</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt"><b>Valuation Allowance</b></font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(10,536,250</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(903,480</font></td>
<td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td style="padding-bottom: 2.5pt; padding-left: 10pt"><font style="font-size: 10pt">Net deferred tax assets</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">—</font></td>
<td style="padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company is required to file federal income
tax returns and state income tax returns in the states of Florida, Georgia and Minnesota. There are no uncertain tax positions
at December 31, 2019. The Company has not undergone any tax examinations since inception and is therefore not subject to examination
by any applicable tax authorities.</p>
-606595
12546000
2944000
3000000
3600000
900000
1000000
1.00
2.00
9000
5000
63000
0
4300000
180000
350000
150000
235000
285000
As a result of the price adjustment feature, the conversion price of the convertible notes was adjusted to $0.36 per share.
750000
8701326
818211
7883115
-9302793
-4908644
-4394149
-9872022
-5477873
-4394149
-0.17
-0.23
-0.13
P2Y2M30D
P2Y1M27D
492141
2944000
528000
228000
1856000
4306000
1856000
180000
1635000
0.15
0.15
0.15
40
4
0.18
1.00
1.00
0.0499
0.07
133000
75000
2650
500
1690000
3750
600
P6Y3M11D
1.00
1.38
P9Y7D
P7Y8M16D
P7Y8M16D
450
12500
68000
5000
49000
162000
83000
15000
The agreement also provides LilyCon Investments with $35,000 in stock (to be calculated using an annual variable weighted average price from February 2019 through January 2020) to be granted on the one-year anniversary of this agreement, if the agreement has not been terminated prior to that date.
This agreement provides for the Company to pay Dr. Haufe royalties equal to 1% of revenues earned from sales of any and all products derived from the use of the DenerveX technology. Royalties are payable to Dr. Haufe within 30 days after the close of each calendar quarter based on actual cash collected from sales of applicable products. The royalty period expires on September 6, 2030.
106061
2019-06-30
2020-03-31
2020-03-31
2020-04-01
1100
2030-09-06
42000
-72563
-1007813
2183478
44806076
0.40
2.73
100
The Series D Shares will be mandatorily converted upon the earlier of 1) the written consent of holders of a majority of Series D shareholders and 2) the common stock is listed and quoted on one of the NASDAQ markets or the New York Stock Exchange as a result of a public offering at a price of at least $1.22451 per share and proceeds of at least $25 million. The Series D Shares also contain an embedded mandatory redemption provision which will occur at the earliest of: (a) 90 days following the date that William E. Horne is no longer serving as the Corporation's CEO and a majority of the Series D holders do not approve of his replacement, (b) William E Horne transfers more than 25% of the stock owned by him to a person not related to him or a current shareholder or (c) the Company's common stock is not listed on a NASDAQ market or the New York Stock Exchange within 30 months as a result of a public offering generating minimum net proceeds of at least $25 million (the "Trigger Date"). The redemption price to be paid is the greater of a) the Original Issue Price of $40.817, plus any accrued and unpaid dividends and (b) the fair market value of the Series D Shares on the redemption date. In lieu of redeeming the Series D Shares for cash, the holder may elect to receive "Trigger Event Warrants" equal to the number of shares of common stock the Series D Shares are convertible into on the Trigger Date. The Trigger Event Warrants will have a ten-year term from the date of redemption and allow the holders to purchase shares of common stock at a price equal to the lower of a) 0.50% of the Original Issue Price and b) the Series D conversion price on the Trigger Date.
0.210
0.210
0.050
0.030
0.00
-0.020
0.00
-0.090
-0.010
0.00
-0.250
-0.130
0.000
0.000
7302375
666888
2483736
154791
424390
57907
242437
25405
81801
10536250
903480
10536250
903480
315855
140877
267399
79045
The Company had warrants that triggered the required issuance of an additional 2,023,438 warrants as a result of the Company's capital raise that gave those new investors a $0.40 per share investment price which required the old warrant holders to receive additional warrants since their price was $0.75 per share.
The Company did not have any assets or liabilities measured at fair value using Level 1 or 2 of the fair value hierarchy as of March 31, 2020 and December 31, 2019.
There is no comparable information for operating leases at or for the year ended December 31, 2018 since the Company adopted ASU No. 2016-02 on January 1, 2019 and elected to recognize operating lease right-of-use assets and operating lease liabilities at the adoption date.
The Company did not have any assets or liabilities measured at fair value using Level 1 or 2 of the fair value hierarchy as of December 31, 2018 or 2019.