US Stem Cell Inc (USRM)

[Dragon Lady]

Quote, "What were the specifics terms of the loan? How long did the filings say until they needed to be paid back?"

I'm not the company accountant or CEO or working for them- how would I know?

I do know the exact amount and description of the original loan is right on the most recent Bioheart 10-Q filing, "subordinated related party debt, $1.5 million"- that matches exactly what the lawsuit filing reads as the original principal owed and the exact wording of the email exhibit from then company "controller" Angel or whatever the name is, that's attached to that lawsuit filing that on the public link.

http://lawsuitpressrelease.com/wp-content/uploads/2014/12/Leonhardt-v.-Bioheart.pdf

Latest 10-Q filing, most recent quarter, PAGE 4:



Then, one can go back to the 2010 10-K filing and see the original debt/loan described via the wording of the "Leonhardt divorce" being described- and it states pretty clearly to me that they admit she had a "debt" owed her and also her then husband. As part of the divorce they then "equally split that debt" and Howard Leonhardt former CEO decided to take shares of common stock for his 50% portion (meaning IMO they paid him, meaning the original debt and them acting, the Leonhardts acting as creditors was confirmed and real, else why did they pay Howard Leonghardt his 50% owed as a large block of shares for his portion?) and Brenda Leonhardt appears to have retained her debt as "owed" and was willing apparently, to wait to be paid and let it accrue interest. The suit is apparently alleging (per my reading of it) that Bioheart then "subordinated" her without rights to do so, putting her in 2nd place to a bunch of other creditors- and then paid off a bunch of other people, including Northstar LLC, aka "insiders" as her loan/debt of $1.5 mil plus interest owed just sat never getting paid, sitting as "subordinated" and being carried forward endlessly on the books- that's my read on it.

Here's the 10-K wording from 2010, affirming again, IMO what the suit is alleging- that she indeed "inherited" via the divorce process, 50% of a debt owed to her and her husband, then CEO and CSO Howard Leonhardt.

http://www.sec.gov/Archives/edgar/data/1388319/000114544311000484/d28195.htm

2010 10-K filing, PAGE 68:

"In February 2010 the Company’s Chief Science and Technology Officer and his spouse filed divorce papers. Pursuant to the divorce, their jointly owned shares and their ownership of the loan to Bioheart which they hold as a result of their payment of $3 million of principal and related interest to Bank of America on behalf of Bioheart, would be divided equally between them. As a result, the Chief Science and Technology Officer’s common shares were then reduced to 2,513,840 and his percentage shareholding of the Company to 13.8%, with his former spouse assuming ownership of the same number of common shares and percentage shareholding of the Company. Their commonly owned loan and related interest, as of March 29, 2010, $4,140,201, was been equally split. The Chief Science and Technology Officer on March 29, 2010, elected to convert his portion of the loan and related interest to restricted common stock and warrants. As a result, Howard Leonhardt, the Company’s Chief Science and Technology Officer, as of March 31, 2010, owns approximately 22 % of the Company."

Right there in plain language IMO. $3 million split 50/50 is the $1.5 million carried on the 2014 10-Q filing as "subordinated, related party debt" in the amount of $1.5 million. All interest owed would be on the "accrued expense" line entry or some similar other line entry than the original principal amount of the loan. One can see that even back in 2011 when that above 10-K was filed, the total owed to the two was already up to $4,140,201 due to fees, expenses and already accruing interest.

Looks like it's all there "on the books" as alleged to me? I don't see anything frivolous or confusing IMO? Pretty clear cut seems to me.