US Stem Cell Inc (USRM)

[Dragon Lady]

ANOTHER MAGNA DILUTION "note" LOL !!!

HOLY COW- they're going back to ole Magna and Josh Sason for another toxic note deal per a LATE FRIDAY, AFTER MARKET CLOSE ole "PR" being issued. FRIDAY after market "PR's" are never a good sign per all my own personal experience with stocks, LOL !! Wowza.

AND, they attached a "PR" about some vague "Clearit" ole "deal" BUT NO MONEY IS STATED AS TRANSACTED (shazam, WHAT A FREAKING SURPRISE, LOL !!) and it's about as vague a classic ole "PR" as it gets IMO. To me, the "Clearit" blah, blah was tacked on to the DILUTION DEAL "PR" to make that PR "look" more tolerable IMO. The Clearit whatever "deal" INVOLVES NO MONEY details, LOL !! Another BHRT CLASSIC ole "PR". All it says is they, BHRT has "secured" the right to purchase UP TO (them ole famous BHRT words LOL. "up to" then means like .001% "up to" 15%, LOL. It's almost meaningless IMO? Who'd write a binding contract with open ended and vague language like that in it?) so "up to" a 15% non-consolidating membership stake in ClearIt and distribution rights to the ERASER(TM) System within the regenerative medicine industry."

WHAT THE FREAK is a "membership stake"????? Is this a club they just joined, LOL?????? It doesn't say OWNERSHIP stake? What exactly is a "membership" stake when it comes to owning a portion of a business, LOL??? THAT is a new one on me????? But hey- what the heck do I know?

WHAT DOES THAT EVEN MEAN, LOL????? "within the regenerative medicine industry"????? WHAT??????? What kind of distribution rights/sales rights contract is written/worded like that? WHAT defines the so called "regenerative medicine industry", LOL???? Distribution/sales "rights" contracts, the only ones I've ever seen- are almost always based on geographic markets/regions, aka "sales territory's" rights. Such as, "BHRT purchased the rights to distribute the Clearit whatever in the entire S-E Asia region and also all countries comprising the European Union", something to that effect. WHAT is the "regenerative medicine industry"??? WHO/WHAT is that even made up of- and how would one then define it from a legal contract standpoint? MAKES NO SENSE TO ME, NONE???? AND, per a standard IMO, vague ole BHRT "PR" it appears that NO MONEY traded hands, but they've "secured" a "right" to sell "up to" 15% "of something" that DOES NOT EVEN EXIST YET as a salable product, LOL????? WHAT???????

So what's the point of that "PR"??? It's amounts to NOTHING for this cash desperate company right now- one that in the same "PR", just had to go back to Magna for a total dilution "note" at HORRIBLE financing terms for another month or two of dilution based survival cash. THAT is the real and only "meat and potatoes" in that "PR" IMO. The "Clearit" whatever "deal" doesn't amount to a freaking hill of beans that I can see??????? Ole BHRT "secured" an interest of "up to" 15% of something that MAY or MAY NOT be for sale someday, LOL!! BUT, they paid no money to "secure" those "up to" 15% rights for the thingy that isn't even for sale yet???? LOL, WHAT??? HOLY COW that makes no freaking sense to me????

But regarding doing a "note" again with ole MAGNA- THAT is what this "PR" is of course really all about- as the SEC filing related to it says that Magna REQUIRES BHRT to "announce it" and also file another SEC "share registration statement" and get it SEC approved- for the deal/financing to even move forward or else various provisions in the contract appear to be activated, including monetary ones that would cost BHRT potentially from my cursory read of the lengthy SEC filed documents. See the SEC filing various "exhibits" linked below- THAT is why this ole "PR" was put out AFTER MARKET CLOSE ON A FRIDAY (never good news released late on Friday's IMO)- but see the devil in those details of those combined SEC filings, it's all there in black n white IMO.

Just pull up a chart and look at the massive decline in share price from when they inked their first "Magna" deals (a toxic "note" and a credit-line type deal, in late 2014. The price decline almost to the day of those deals- was massive, and has continued a massive downward trajectory ever since, from approx .018 to 2 CENTS a share then, to now approx .0016 to .0018 cents Bid, today and a new all, all, all time RECENT LOW of .0013 made just this week. A massive, approx 90% loss to the BHRT common share value in the past 1 yr period since those two Magna deals were inked)

So lil ole BHRT is going back to Magna for more dilution survival cash looks like to me. HOLY FREAKING COW. A toxic note with a $160K "face value" but it looks like for which Bioheart only receives $100K cash?? WOW, talk about rough and stiff terms??? Speaking of- WHAT HAPPENED TO THE NAME CHANGE and that big ole massive 1000 to 1 R/S reverse ole split?? It HAS NOT HAPPENED YET????? I checked the Florida Secretary of State web site just a little earlier today- and NO Corporate name change or amendment(s) filed that I can see???????? Wonder what gives with the delay on all that??? BUT NOW, NOW another Manga dilution note instead???

The terms of this latest Magna "financing" deal look mega "stiff" from an initial read of the SEC filing- it's got a 55% FREAKING share discount, HOLY COW, on top of 12% interest. This is gonna be another share price crusher in my humble opinion. Ole Sason strikes again looks like.

http://www.bloomberg.com/news/articles/2015-03-12/josh-sason-made-millions-from-penny-stock-financing

Also, WHY did they, BHRT have to go back to Magna for a traditional "toxic" "note" when they had "up to" $3 MILLION on the Magna "credit-line facility" they inked near end of 2014 that they could "tap" and per the last filed 10-Q , had only tapped a fraction of that amount??? MAKES NO SENSE TO ME?????? Are the terms of the Magna credit-line preventing BHRT from using that anymore- cause perhaps Magna now owns too large a percentage of BHRT from massive conversion of dilution shares or something like that?????

Here's the wording of the new Magna "toxic" note from the SEC filing today:

https://www.sec.gov/Archives/edgar/data/1388319/000118518515002480/bioheart8k100115.htm

"Item 1.01
Entry into Material Definitive Agreement

Securities Purchase Agreement and Convertible Note

On October 1, 2015 (the “Closing Date”), Bioheart, Inc., a Florida corporation (the “Company”), entered into a securities purchase agreement dated as of the Closing Date (the “Purchase Agreement”) with Magna Equities II, LLC, a New York limited liability company (“Magna”). The Purchase Agreement provides that, upon the terms and subject to the conditions set forth therein, Magna shall purchase from the Company on the Closing Date a senior convertible note with an initial principal amount of $160,000 (the “Convertible Note”) for a purchase price of $100,000 (a 37.5% original issue discount). Pursuant to the Purchase Agreement, on the Closing Date, the Company issued the Convertible Note to Magna.

$20,000 of the outstanding principal amount of the Convertible Note (together with any accrued and unpaid interest with respect to such portion of the principal amount) shall be automatically extinguished (without any cash payment by the Company) if (i) the Company has properly filed a registration statement with the Securities and Exchange Commission (“SEC”) on or prior to the Filing Deadline (defined below) covering the resale by Magna of all of the shares of Common Stock issued or issuable upon conversion of the Convertible Note and (ii) no event of default or an event that with the passage of time or giving of notice would constitute an event of default has occurred on or prior to such date. Moreover, $30,000 of the outstanding principal amount of the Convertible Note (together with any accrued and unpaid interest with respect to such portion of the principal amount) shall be automatically extinguished (without any cash payment by the Company) if (i) the Company has filed a registration statement with the SEC that has been declared effective by the SEC on or prior to the Effectiveness Deadline (defined below) and the prospectus contained therein is available for use by Magna for the resale by Magna of all of the shares of Common Stock issued or issuable upon conversion of the Convertible Note and (ii) no event of default or an event that with the passage of time or giving of notice would constitute an event of default has occurred on or prior to such date.

The Convertible Note matures on August 1, 2016 and, in addition to the 37.5% original issue discount, accrues interest at the rate of 12% per annum. The Convertible Note is convertible at any time, in whole or in part, at Magna’s option into shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”), at a fixed conversion price of $0.00072 per share (subject to adjustment). This conversion price represents a discount of approximately 55% from the lowest trading price of the Common Stock during the five trading days prior to the Closing Date. If the Company has not properly filed a registration statement with the SEC on or prior to the date that is 70 calendar days after the Closing Date covering the resale by Magna of all of the shares of Common Stock issued or issuable upon conversion of the Convertible Note, then, from and after such date, the Convertible Note will be convertible at any time, in whole or in part, at Magna’s option into Common Stock at a conversion price equal to a 55% discount from the lowest trading price of the Common Stock during the five consecutive trading days ending and including the trading day immediately preceding the applicable date of conversion. At no time will Magna be entitled to convert any portion of the Convertible Note to the extent that after such conversion, Magna (together with its affiliates) would beneficially own more than 4.99% of the outstanding shares of Common Stock as of such date. The Convertible Note includes “full ratchet” and standard anti-dilution protection.

The Convertible Note includes customary event of default provisions, and provides for a default interest rate of 18%. Upon the occurrence of an event of default, Magna may require the Company to pay in cash the “Event of Default Redemption Price” which is defined in the Convertible Note to mean the greater of (i) the product of (A) the amount to be redeemed multiplied by (B) 140% (or 100% if an insolvency related event of default) and (ii) the product of (X) the conversion price in effect at that time multiplied by (Y) the product of (1) 140% (or 100% if an insolvency related event of default) multiplied by (2) the greatest closing sale price of the Common Stock on any trading day during the period commencing on the date immediately preceding such event of default and ending on the date the Company makes the entire payment required to be made under this provision.

The Company has the right at any time to redeem all, but not less than all, of the total outstanding amount then remaining under the Convertible Note in cash at a price equal to 140% of the total amount of the Convertible Note then outstanding."


So BHRT gets $100K but the "face value" they may owe to Magna is as high as $160K and looks like at a minimum $110K, IF they, BHRT meet all the provisions. IF BHRT wanted to pay the note back (fat chance of that happening IMO, LOL !!) they'd owe Magna 140% of the total amount of the remaining note not yet converted/remaining. Ole Magna is getting shares for at LEAST as low as .00072 per share, and maybe LOWER depending apparently on whether BHRT performs and meets certain terms within certain time frames per the lengthy agreements. WOWZA, HOLY FREAKING COW. 10's of MILLIONS of dilution shares at .00072, that's gotta be a share price CRUSHER in the end I'd think- I don't see how it won't be??? This thing is gonna continue to spiral in to the dirt IMO.

Lets say Magna converts $110K worth at about that .00072 price- how much massive more dilution is that going to result in????

$110K / .00072 = 152,777,777 shares to Magna. 153 MILLION more dilution shares (at a minimum) ole Magna is gonna get on the cheap. HOLY FREAKING COW.

What's that gonna do to the common share price as those hit the Ask/Sell-side and as Magna "does what they do", selling those things down in their ratchet/death spiral fashion they're so well known for (SEE THE BLOOMBERG FINANCE PIECE ON MAGNA and Josh Sason, including the "death spiral" graphics and written explanation of how it works). WOWZA, this can't be good going forward IMO. BHRT must be just totally cash desperate as usual.

I can't wait to see the Q-3 10-Q filing, that's gonna be a doozy IMO. I wonder what the dilution share count is at by now and how low their cash balance has hit recently???

https://www.sec.gov/Archives/edgar/data/1388319/000118518515002480/ex4-1.htm

https://www.sec.gov/Archives/edgar/data/1388319/000118518515002480/ex10-1.htm

https://www.sec.gov/Archives/edgar/data/1388319/000118518515002480/ex10-2.htm