Description of Business, Going Concern and Basis of Presentation

Organization and Basis of Presentation

ThermoGenesis Holdings, Inc. (“ThermoGenesis Holdings,” the “Company,” “we,” “our,” “us”), develops, commercializes and markets a range of automated technologies for CAR-T and other cell-based therapies. The Company currently markets a full suite of solutions for automated clinical biobanking, point-of-care applications, and automation for immuno-oncology, including its semi-automated, functionally closed CAR-TXpress™ platform, which streamlines the manufacturing process for the emerging CAR-T immunotherapy market. The Company was founded in

1986

and is registered in the State of Delaware and headquartered in Rancho Cordova, CA.

The Company previously had

two

reportable segments, a Device Segment and a Clinical Development Segment. Due to the winding down of the Clinical Development Segment in

2019,

the Company

longer has any material revenues or expenses in that segment. As a result, the Company's chief operating decision maker

longer reviews unconsolidated operating results and the Company

longer reports in

two

segments. The Company provides the AutoXpress® and BioArchive® platforms for automated clinical bio-banking, PXP® platform for point-of-care cell-based therapies and CAR-TXpress™ platform under development for bio-manufacturing for immuno-oncology applications. The Company and its subsidiaries currently manufacture and market the following products:

Clinical Bio-Banking Applications:

●

AXP® II Automated Cell Separation System – an automated, fully closed cell separation system for isolating and retrieving stem and progenitor cells from umbilical cord blood, registered as a U.S. FDA

510

(k) medical device.

●

BioArchive® Automated Cryopreservation System – an automated, robotic, liquid nitrogen controlled-rate-freezing and cryogenic storage system for cord blood samples and cell therapeutic products used in clinical applications, registered as a U.S. FDA

510

(k) medical device.

Point-of-Care Applications:

●

PXP®

Point-of-Care System – an automated, fully closed, sterile system allows for the rapid, automated processing of autologous peripheral blood or bone marrow aspirate derived stem cells at the point-of-care, such as surgical centers or clinics, registered as a U.S. FDA

510

(k) medical device.

●

PXP-LAVARE System – an automated, fully closed system that is designed to wash, re-suspend and volume reduce cell suspensions. It allows for volume manipulation, supernatant or media exchange, and cell washing to occur without comprising cell viabilities and maximizing recoveries, registered as a U.S. FDA

510

(k) medical device.

●

PXP-

1000

System – an automated, fully closed system that provides fast, reproducible separation of multiple cellular components from blood with minimal red blood cell contamination, registered as a U.S. FDA

510

(k) medical device.

Large Scale Cell Processing and Biomanufacturing:

●

-Series® Products:

-Lab® for cell isolation,

-Wash® System for cell washing and reformulation,

-Mini® for high efficiency small scale cell purification, and

-BACS® System under development for large scale cell purification using our proprietary buoyancy-activated cell sorting (“BACS”) technology.

●

CAR-TXpress™ Platform – a modular designed, functionally closed platform that addresses the critical unmet need for large scale cellular processing and chemistry, manufacturing and controls (“CMC”) needs for manufacturing chimeric antigen receptor (“CAR”) T cell therapies. CAR-TXpress is owned and developed through CARTXpress Bio, Inc. (“CARTXpress Bio”), a subsidiary in which we own

80%

of the equity interest.

January 1, 2019,

the Company entered into a reorganization of the business and equity ownership of its majority-owned ThermoGenesis Corp. subsidiary. Pursuant to the reorganization, the assets acquired by ThermoGenesis Corp. from SynGen Inc. in

July 2017

were contributed to a newly formed Delaware subsidiary of ThermoGenesis Corp., CARTXpress Bio, and the

20%

interest in ThermoGenesis Corp. held by a

third

party was exchanged for

20%

interest in CARTXpress Bio. As a result, the Company holds an

80%

equity interest in CARTXpress Bio and the Company has become the owner of

100%

of ThermoGenesis Corp. The purpose of the reorganization was to allow CARTXpress Bio to focus on the development and commercialization of the newly launched CARTXpress Bio cellular manufacturing platform.

In the reorganization, the Company reacquired the non-controlling interest shares in ThermoGenesis Corp., in exchange for a

20%

equity interest in the newly formed subsidiary, CARTXpress Bio, which amounted to approximately

$1,100,000.

Non-controlling interest of

$2,843,000

was recorded related to the reorganization and a corresponding debit was recorded in additional paid in capital.

ThermoGenesis Holdings is an affiliate of the Boyalife Group, a global diversified life science holding company that focuses on stem cell technology and cell-based therapeutics.

Reverse Stock Split

June 4, 2019,

the Company effected a

one

(

) for

ten

(

) reverse stock split of its issued and outstanding common stock. The total number of shares of common stock authorized for issuance by the Company of

350,000,000

shares did

not

change in connection with the reverse stock split.

All historical share amounts disclosed herein have been retroactively restated to reflect the reverse split and subsequent share exchange.

fractional shares were issued as a result of the reverse stock split, as fractional shares of common stock were rounded up to the nearest whole share.

Liquidity and Going Concern

The Company has a Revolving Credit Agreement (the “Credit Agreement”) with Boyalife Asset Holding II, Inc. (

See Note

). As of

December 31, 2020,

the Company had drawn down the full

$10,000,000

that is available under the Credit Agreement. Boyalife Asset Holding II, Inc. is a wholly owned subsidiary of Boyalife Group Inc., which is owned and controlled by the Company's Chief Executive Officer and Chairman of our Board of Directors.

December 31, 2020,

the Company had cash and cash equivalents of

$7,161,000

and working capital of

$9,155,000.

The Company has incurred recurring operating losses as of

December 31, 2020.

If these recurring losses continue, it could raise substantial doubt about the Company's ability to continue as a going concern within

one

year from the filing of this report. The Company

may

require additional capital to grow the business, to fund other operating expenses and to make interest payments. The Company's ability to fund its cash needs is subject to various risks, many of which are beyond its control, including, but

not

limited to, risks attributable to the COVID-

pandemic. The Company

may

seek additional funding through bank borrowings or public or private sales of debt or equity securities or strategic partnerships. The Company cannot guarantee that such funding will be available on a timely basis, in needed quantities or on terms favorable to us, if at all.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern; however, the conditions described herein raise substantial doubt about the Company's ability to continue as a going concern. The consolidated financial statements do

not

include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that

may

become necessary should the Company be unable to continue as a going concern.

Principles of Consolidation

The consolidated financial statements include the accounts of ThermoGenesis Holdings and its wholly-owned subsidiaries, ThermoGenesis Corp. and TotipotentRX Cell Therapy, Pvt. Ltd and ThermoGenesis Corp's majority-owned subsidiary, CARTXpress Bio. All significant intercompany accounts and transactions have been eliminated upon consolidation. The Company owns

18.79%

of a private company, ImmuneCyte, which is accounted for using the equity method due to the significant influence the Company has over ImmuneCyte's operations.

Non-controlling Interests

The

20%

ownership interest of CARTXpress Bio that is

not

owned by ThermoGenesis Holdings is accounted for as a non-controlling interest as the Company has an

80%

ownership interest in the subsidiary. Earnings or losses attributable to other stockholders of a consolidated affiliated company are classified separately as "non-controlling interest" in the Company's consolidated statements of operations. Net loss attributable to non-controlling interest reflects only its share of the after-tax earnings or losses of an affiliated company. The Company's consolidated balance sheets reflect non-controlling interests within the equity section.