NOTE 2 - GOING CONCERN, LIQUIDITY AND MANAGEMENT'S PLAN - Marketscreener.com

Warrants to Purchase Common Stock of the Company
A summary of our Warrants activity and related information follows:
Options to Purchase Common Stock of the Company
A summary of our stock option activity and related information follows:
Other current assets consist of the following:
Inventory consists of the following:
Inventory assets (finished goods) $ 460,542 $ 349,216 TOTAL INVENTORY
NOTE 6 – PROPERTY AND EQUIPMENT
Property and equipment consist of the following:
TOTAL PROPERTY AND EQUIPMENT, NET $ 874,785 $ 1,138,891
Depreciation expense for the six months ended June 30, 2022 and 2021 was $264,106 and $293,094, respectively.
Intangible assets consist of the following:
Other assets consist of the following:
NOTE 8 – OTHER CURRENT LIABILITIES
Other current liabilities consist of the following:
228,528
54,802
173,904
139,041
983,667
38,367
103,791
70,388
TOTAL OTHER CURRENT LIABILITIES $ 13,352,560 $ 11,740,218
(1) Salary for Steve Johnson, CEO, between February 15, 2018, and September 30,
2020.
(2) Renewal of directors and officer’s insurance.
The effective tax rate for the six months ended June 30, 2022, was different from the federal statutory rate due primarily to change in the valuation allowance and nondeductible interest and amortization expense.
NOTE 10 – AGREEMENT WITH PDL BIOPHARMA, INC.
In connection with the PDL Credit Agreement, as amended, we issued the PDL Warrant to the Lender. The fair value of the PDL Warrant at issuance was $1,600,000 which has been recorded as deferred issuance costs in the accompanying consolidated financial statements. As of June 30, 2022, the Amended PDL Warrant has not been exercised.
NOTE 11 – AGREEMENT WITH HEALTHCOR
Below is a summary of the total underlying shares of common stock related to HealthCor and related investors:
NOTE 12 – JOINT VENTURE AGREEMENT
On November 30, 2021, the Company and Rockwell entered into a Sixth Amendment to the Rockwell Note (the “Sixth Rockwell Note Amendment”), pursuant to which Rockwell agreed to extend the term of the Rockwell Note by three months, to March 31, 2022, and agreed that the quarterly principal payment that would otherwise be due on December 31, 2021 will not be required to be made until March 31, 2022.
As of March 31, 2022, the Rockwell Note was paid off.
Operating lease asset and liability for our operating lease were recorded in the condensed consolidated balance sheet as follows:
Operating lease liability, net of
Future lease payments included in the measurement of operating lease liability on the condensed consolidated balance sheet as of June 30, 2022, for the following five fiscal years and thereafter as follows:
Present value of future minimum lease payments $ 548,000
The table below presents certain information related to the cash flows for the Company’s operating lease for the six months ended June 30, 2022:
The Company has evaluated subsequent events through August 12, 2022, the date of filing of this Form 10-Q.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
We maintain a website at www.care-view.com and our Common Stock trades on the OTCQB under the symbol “CRVW.”
CareView Patient Safety System
The CareView Patient Safety System can be easily configured to meet the individual privacy and security requirements of any hospital or nursing facility. CareView is (“HIPAA”) compliant and HITRUST certified. Additional HIPAA-compliant features allow privacy options to be enabled at any time by the patient, nurse, or physician.
CareView Patient Safety System Products and Services Agreement with Healthcare Facilities
CareView Patent Safety System Sales-Based Model
CareView continues its dedication to provide service and support on a 24x7x365 basis for every customer under the prior and updated revenue models.
Alert Management and Monitoring System
Pricing Structure and Revenue Streams
Purchasing Agreement with Decisive Point Consulting Group, LLC
Indefinite Delivery Indefinite Quality (IDIQ) Contract
General Service Administration Multiple Award Schedule
Group Purchasing Agreement with HealthTrust Purchasing Group, LP
On October 1, 2018, the Company added CareView Connect to the HealthTrust GPO Agreement.
On November 1, 2020, the updated contracting model has been added to the HealthTrust GPO Agreement which allows us to sell the proprietary hardware and license the software on an annualized basis. On December 1, 2021, the HealthTrust GPO Agreement was renewed for another 3-years term.
Group Purchasing Agreement with Premier, Inc.
Summary of Product and Service Usage
Other product deployment costs, excluding human resources and travel and entertainment costs
Management controlled operating expenses relatively flat to prior comparative period.
Our second quarter 2022 net loss of approximately $2,502,000 decreased approximately $518,000 or 17%, as compared to approximately $3,020,000 net loss for the second quarter of 2021.
Revenue increased approximately $106,000 for the six months ended June 30, 2022, as compared to the same period in 2021. The increase was attributable to recognizing deferred revenue from software sales.
Other product deployment costs, excluding human resources and travel and entertainment costs
Operating expenses increased by a net 10% or $459,000. The increase was attributable to patent maintenance, property taxes, sales taxes, software licenses, advertising and marketing, hospital credentialing, trade shows, and rent being higher than the comparable period.
Year-to-date 2022 net loss of approximately $4,846,000 decreased approximately $660,000 or 12%, as compared to approximately $5,507,000 net loss for the comparable six months of 2021.
Liquidity and Capital Resources
The Company’s net losses and cash outflows raise doubt exists about the Company’s ability to continue as a going concern through August 12, 2023. The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern. This basis of accounting contemplates the recovery of the Company’s assets and the satisfaction of liabilities in the normal course of business. A successful transition to attaining profitable operations is dependent upon achieving a level of positive cash flows adequate to support the Company’s cost structure.
Recently Issued and Newly Adopted Accounting Pronouncements
We do not expect that the adoption of any recent accounting pronouncements will have a material impact on our accompanying condensed consolidated financial statements.
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