Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this offering. Some of the information contained in this discussion and analysis, including information regarding the strategy and plans for our business, includes forward-looking statements that involve risks and uncertainties. You should review the "Risk Factors" section for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

Atom Limbs is creating the world's first mind-controlled and most advanced bionic arm. To start, we're selling it to amputees and people who suffered limb loss.

We're in conversation with several non-med robotic organizations too — from agriculture, deep sea, hazardous environments, factory ad hoc assembly, and more.

We are currently moving from the clinical stage to the commercial stage, aiming to ship to the market in 2022.
In 5 years, we hope to have sold 1,000 of our initial Atom Touch arms ($100K-$300K each). We hope to be moving to the Atom Touch V2 at a lower price point ($30K-$50K). We want to emphasize that the Atom Touch arm is poised for both medical and non-medical markets. These future projections cannot be guaranteed.
Given the Company’s limited operating history, the Company cannot reliably estimate how much revenue it will receive in the future, if any.

Milestones

Atom Limbs Inc was incorporated in the State of Delaware in April 2019. Atom Limbs does not currently own the Modular Prosthetic Limb or IP. Atom Limbs currently has executed an exclusive option agreement with JHU APL and intends to negotiate a licensing agreement.

Since then, we have:

• Full arm, hand, and finger dexterity. 200 sensors (100x more than competition).
• CEO prev. cofounder of Bebo (acq. by Amazon). Team: Johns Hopkins, Apple, IDEO, Intel, NASA.
• $120M grant from US from DARPA used for research in the last 15 years.
• In development for 10 years. Trialed by 20 amputees/quadriplegics, military, teleoperations.
• Backed by VILLAGE Global who has LPs that include Bill Gates, Reid Hoffman, Jeff Bezos.
• Founding team includes co-inventors of iMac and da Vinci Surgical System

Historical Results of Operations

Our company was organized in April 2019 and has limited operations upon which prospective investors may base an evaluation of its performance.

• Revenues & Gross Margin. For the period ended December 31, 2019, the Company had revenues of $0.
• Assets. As of December 31, 2019, the Company had total assets of $79,937, including $78,122 in cash.
• Net Loss. The Company has had a net loss of $137,202 for 2019.
• Liabilities. The Company's liabilities totaled $0 for 2019.

Liquidity & Capital Resources

To-date, the company has been financed with $150,000 in SAFEs.

After the conclusion of this Offering, should we hit our minimum funding target, our projected runway is 18 months before we need to raise further capital.

We plan to use the proceeds as set forth in this Form C under "Use of Funds". We don’t have any other sources of capital in the immediate future.

We will likely require additional financing in excess of the proceeds from the Offering in order to perform operations over the lifetime of the Company. We plan to raise capital in 12 months. Except as otherwise described in this Form C, we do not have additional sources of capital other than the proceeds from the offering. Because of the complexities and uncertainties in establishing a new business strategy, it is not possible to adequately project whether the proceeds of this offering will be sufficient to enable us to implement our strategy. This complexity and uncertainty will be increased if less than the maximum amount of securities offered in this offering is sold. The Company intends to raise additional capital in the future from investors. Although capital may be available for early-stage companies, there is no guarantee that the Company will receive any investments from investors.

Runway & Short/Mid Term Expenses

Atom Limbs Inc cash in hand is $6,800, as of September 2020. Over the last three months, revenues have averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $10,000/month, for an average burn rate of $10,000 per month. Our intent is to be profitable in 24 months.

There have been no major changes since the date our financials cover. Payroll & general expenses have continued. The worldwide COVID pandemic hasn't materially impacted our finances or operations currently.

As we are still progressing thru EVT & DVT development stages, as well as final FDA approval, we don't expect to generate any revenue until 2022. Our Year One revenue expectation in 2022 is $10M (sales of 50 arms). Expenses next 3-6 months are $100-200K. Further breakdown available in the campaign page. These projections cannot be guaranteed.

Total, we expect it to cost an additional $30M for us to get to market.

We have a few different funding options currently in progress: grant applications (SBIR/STTR/DOD), VC fundraising, family office fundraising.

The $120M DARPA award was for the last 15 years of R&D. It is depleted. It was used to fund R&D of a program called Revolutionizing Prosthetics. Both Johns Hopkins and DEKA received the award. Johns Hopkins used the funds for hardware and software R&D, amputee & quadriplegic IDE clinical trials, producing multiple prototypes and versions, media coverage, etc.