CEREBAIN BIOTECH CORP. - FORM 10-Q

Attached files

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EX-32.2 - CERTIFICATION - CEREBAIN BIOTECH CORP.	cbbt_ex322.htm
EX-31.1 - CERTIFICATION - CEREBAIN BIOTECH CORP.	cbbt_ex311.htm
EX-32.1 - CERTIFICATION - CEREBAIN BIOTECH CORP.	cbbt_ex321.htm
EXCEL - IDEA: XBRL DOCUMENT - CEREBAIN BIOTECH CORP.	Financial_Report.xls
EX-31.2 - CERTIFICATION - CEREBAIN BIOTECH CORP.	cbbt_ex312.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2014

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

CEREBAIN BIOTECH CORP.

(Exact name of registrant as specified in its charter)

Nevada		000-54381		26-1974399
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification No.)

13727 Noel Road, Tower II, Suite 200 Dallas, TX 75240
(Address of principal executive offices)

949-415-7478
(Registrant’s telephone number, including area code)

(Former address, if changed since last report)

13455 Noel Road, Suite 1000 Dallas, TX 75240
(Former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS

DURING THE PRECEDING FIVE YEARS

Indicate by check mark whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes ¨ No ¨

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer's classes of stock, as of the latest practicable date.

Class of Securities	Shares Outstanding at February 17, 2015
Common Stock, $0.001 par value	4,447,448

CEREBAIN BIOTECH CORP.

TABLE OF CONTENTS

		PAGE

PART I – FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS		3

	UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS		4

	UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS		5

	UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS		6

	NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS		7

ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		17

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		26

ITEM 4.	CONTROLS AND PROCEDURES		26

PART II – OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS		28

ITEM 1A.	RISK FACTORS		28

ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		28

ITEM 3.	DEFAULTS UPON SENIOR SECURITIES		28

ITEM 4.	MINING SAFETY DISCLOSURES		28

ITEM 5.	OTHER INFORMATION		28

ITEM 6.	EXHIBITS		29

	SIGNATURES		33

PART 1 - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

The unaudited condensed consolidated financial statements of registrant for the three and six months ended December 31, 2014 and 2013 follow. The condensed consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. All such adjustments are of a normal and recurring nature.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

	December 31,			June 30,
	2014			2014
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	15,641		$	1,688
Prepaid expenses		402,669			694,292
Total current assets		418,310			695,980

Long-term assets:
Patent rights		133,900			133,900

Total assets	$	552,210		$	829,880

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	219,752		$	133,200
Related party payables		347,471			288,009
Related party notes payable		113,000			144,153
Total current liabilities		680,223			565,362

Long term liabilities:
Convertible note to stockholders, net of debt discount of $228,013 and $444,127, respectively		1,499,487			1,058,373

Total liabilities		2,179,710			1,623,735

Commitments and contingencies (Note 4)

Stockholders’ deficit
Preferred stock ($0.001 par value: 1,000,000 shares authorized; none issued and outstanding)		-			-
Common stock ($0.001 par value: 249,000,000 shares authorized; 4,447,448 and 4,176,323 shares issued and outstanding at December 31 and June 30, 2014, respectively)		4,447			4,176
Additional paid in capital		5,832,732			5,356,697
Accumulated deficit		(7,464,679	)		(6,154,728	)
Total stockholders’ deficit		(1,627,500	)		(793,855	)

Total liabilities and stockholders’ deficit	$	552,210		$	829,880

See accompanying notes to unaudited condensed consolidated financial statements.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	For the Six Months Ended						For the Three Months Ended
	December 31,						December 31,
	2014			2013			2014			2013

Operating Expenses
Selling, general and administrative expenses	$	772,643		$	1,046,099		$	428,426		$	564,700
Research and development costs		243,750			177,160			121,875			88,960
Marketing expenses		100,237			87,109			39,351			33,768
Total operating expenses		1,116,630			1,310,368			589,652			687,428
Other (income) expense
Accretion of debt discount		96,186			206,736			37,329			123,648
Interest expense		97,135			63,328			49,540			43,709
Total other (income) expense		193,321			270,064			86,869			167,357
Net operating loss		(1,309,951	)		(1,580,432	)		(676,521	)		(854,785	)

Loss before income taxes		(1,309,951	)		(1,580,432	)		(676,521	)		(854,785	)
Income taxes		-			-			-			-
Net loss	$	(1,309,951	)	$	(1,580,432	)	$	(676,521	)	$	(854,785	)

Loss per share:
Basic and diluted loss per share	$	(0.30	)	$	(0.47	)	$	(0.15	)	$	(0.25	)
Basic and diluted weighted average shares outstanding		4,310,542			3,337,212			4,396,405			3,381,641

See accompanying notes to unaudited condensed consolidated financial statements.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

		For the Six Months Ended
		December 31,
		2014			2013
Cash flows from operating activities:
	Net loss	$	(1,309,951	)	$	(1,580,432	)
Adjustments to reconcile net loss to net cash used in operating activities:
	Accretion of debt discount		96,186			206,736
	Warrants issued for research and development		-			65,660
	Stock compensation related to stock options		156,750			123,250
	Amortization of prepaid stock based consulting compensation		509,654			691,000
Changes in operating assets and liabilities:
	Prepaid expenses		(12,281	)		(28,467	)
	Accounts payable		86,552			(10,396	)
	Related party payables		101,743			83,487
	Accrued payroll and taxes		-			(12,880	)
Net cash used in operating activities			(371,347	)		(462,042	)

Cash flows from financing activities:
	Proceeds from issuance of common stock		135,300			-
	Notes payable to related parties		-			1,600
	Repayment of notes payable to related parties		-			(26,068	)
	Repayment of notes payable to stockholders		-			(5,720	)
	Notes payable to stockholders		250,000			596,220
Net cash flows provided by financing activities:			385,300			566,032

Net change in cash and cash equivalents			13,953			103,990
Cash and cash equivalents - beginning of period			1,688			8
Cash and cash equivalents - end of period		$	15,641		$	103,998

Supplemental disclosure of non-cash activities:
Cash paid during the period for:
	Interest	$	-		$	-
	Income tax	$	-		$	-

Supplemental disclosure on non-cash investing and financing activities:

Beneficial conversion feature on convertible note	$	119,928	$	769,706
Stock issued for prepaid services	$	122,300	$	1,474,500
Options issued for prepaid services	$	83,450	$	-
Stock issued for satisfaction of accounts payable	$	-	$	7,500
Stock issued for satisfaction of related party payables	$	40,000	$	-
Conversion convertible notes payable and interest into stock	$	25,781	$	-
Conversion of related party notes payable and interest into stock	$	32,653	$	219,700

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

NOTE 1 – ORGANIZATION AND PRINCIPAL ACTIVITIES

Description of Business

Cerebain Biotech Corp. (Formerly Discount Dental Materials, Inc.) (“Cerebain Biotech”), was incorporated on December 18, 2007 under the laws of Nevada. The Company is a smaller reporting biomedical company and through its wholly owned subsidiary, Cerebain Operating, Inc. (Formerly Cerebain Biotech Corp.), the Company’s business revolves around the discovery of products for the treatment of Alzheimer’s disease utilizing Omentum. The Company plans to produce products that will include both a medical device solution as well as a synthetic drug solution.

Cerebain Operating, Inc. was incorporated on February 22, 2010, in the State of Nevada.

The accompanying (a) condensed balance sheet at June 30, 2014 has been derived from audited statements and (b) unaudited interim condensed financial statement as of December 31, 2014 and for the three and six months ended December 31, 2014 and 2013 have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company's financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these financial statements should be read in conjunction with the Company's audited financial statements and notes thereto for the year ended June 30, 2014 included on Form 10-K filed with the Securities and Exchange Commission on August 11, 2014.

NOTE 2 – BASIS OF PRESENTATION

The Company operates in one segment in accordance with accounting guidance Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 280, Segment Reporting. Our Principal Executive Officer has been identified as the chief operating decision maker as defined by FASB ASC Topic 280.

Reverse Stock Split

On April 15, 2014, the Company filed a Certificate of Amendment to our Certificate of Incorporation to implement a one-for-ten reverse split of our common stock (the “Reverse Stock Split”). The ratio for the Reverse Stock Split was determined by our Board of Directors subject to the approval of the Company’s stockholders. The Company received approval from its stockholders on April 15, 2014 and the Company’s common stock began trading on a post-split basis on June 19, 2014.

As a result of the Reverse Stock Split, each ten shares of the Company’s issued and outstanding common stock were automatically combined and converted into one issued and outstanding share of common stock. The Reverse Stock Split affected all issued and outstanding shares of the Company’s common stock, as well as common stock underlying stock options, stock appreciation rights, restricted stock, restricted stock units, warrants and convertible debentures outstanding immediately prior to the effectiveness of the Reverse Stock Split. The Reverse Stock Split reduced the number of shares of the Company’s common stock outstanding from approximately 41 million to 4.1 million at the time of the Reverse Stock Split. The Reverse Stock Split did not alter the par value of common stock, which remained $0.001 per share, or modify any voting rights or other terms of the Company’s common stock. Unless otherwise indicated, all information set forth herein gives effect to such Reverse Stock Split.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

Going Concern

The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. The Company had an accumulated deficit of $7,464,679 and $6,154,728 at December 31 and June 30, 2014, respectively, and had a net loss of $1,309,951 and $1,580,432 for the six months ended December 31, 2014 and 2013, respectively, and net cash used in operating activities of $371,347 and $462,042 for the six months ended December 31, 2014 and 2013, respectively, with no revenue earned since inception. These matters, among others, raise substantial doubt about our ability to continue as a going concern.

While the Company is in the process of developing its medical device solution and its synthetic drug solution for the treatment of dementia, the Company’s cash position may not be significant enough to support the Company’s daily operations. Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to generate revenues and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate revenues.

The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States and have been consistently applied in the preparation of the financial statements.

Use of Estimates

The preparation of these financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the financial statements and the reported amounts of net sales and expenses during the reported periods. Actual results may differ from those estimates and such differences may be material to the financial statements. The more significant estimates and assumptions by management include among others: useful lives and residual values of long-lived assets, the valuation of equity instruments and the valuation of warrants and options. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Cerebain Biotech Corp. and its wholly-owned subsidiary, Cerebain Operating, Inc. (collectively referred to as the “Company”). There are no material intercompany transactions.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENT

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

Revenue Recognition

The Company expects to recognize revenues in accordance with the guidelines of the Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin (“SAB”) No. 104 “Revenue Recognition”.

Under SAB 104, four conditions must be met before revenue can be recognized: (i) there is persuasive evidence that an arrangement exists, (ii) delivery has occurred or service has been rendered, (iii) the price is fixed or determinable, and (iv) collection is reasonably assured.

Cash and Cash Equivalents

For purposes of the statements of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of six months or less to be cash equivalents. Accounts held at U.S. financial institutions are insured by the FDIC up to $250,000. Cash balances could exceed insured amounts at any given time, however, the Company has not experienced any such losses.

Advertising Costs

Advertising costs are recorded as general and administrative expenses when they are incurred. Advertising costs charged to operations were approximately $100,000 and $87,000 for the six months ended and $39,000 and $34,000 for the three months ended December 31, 2014 and 2013, respectively, and are included in marketing costs in the accompanying consolidated statements of operations.

Research and Development

The Company expenses the cost of research and development as incurred. Research and development costs charged to operations were approximately $244,000 and $177,000 for the six months ended and $122,000 and $89,000 for the three months ended December 31, 2014 and 2013, respectively, and are included in research and development costs in the accompanying consolidated statements of operations.

Concentrations, Risks, and Uncertainties

The Company is a startup company subject to the substantial business risks and uncertainties inherent to such an entity, including the potential risk of business failure.

Recent Accounting Pronouncements

The Company has evaluated new accounting pronouncements that have been issued and are not yet effective for the Company and determined that there are no such pronouncements expected to have an impact on the Company’s future financial statements.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

NOTE 4 – COMMITMENTS AND CONTINGENCIES

Employment Agreements

On June 15, 2013, we entered into an employment agreement with Eric Clemons. Under the terms of the agreement, Mr. Clemons shall be paid an annual salary of One Hundred Fifty-Six Thousand Dollars ($156,000), shall be entitled to a bonus of $40,000 upon delivery to the company of a prototype medical device from Sonos Models Inc., and should he be responsible for the Company consolidating with or merge into another corporation or convey all or substantially all of its assets to another corporation, will receive a cash bonus calculated using a Lehman formula of 5% for the first $1,000,000, 4% for the second $1,000,000, 3% for the third $1,000,000, 2% for the fourth $1,000,000, and 1% thereafter. In addition, we also will issue Mr. Clemons an option to acquire up to 100,000 Shares of our Common Stock, fully paid and non-assessable at an exercise price of $5.00 per share subject to a vesting schedule. On August 30, 2013, we entered into an addendum to this agreement in which Mr. Clemons will be entitled to a stock award of 25,000 shares of our common restricted stock if, within 24 months, there is a reorganization of the company. On October 1, 2014, the Company entered into an addendum to the employment agreement with Eric Clemons. Under the terms of the addendum, the agreement has been extended one year until June 15, 2017. Mr. Clemons shall be paid an annual salary of One Hundred Ninety Five Thousand Dollars ($195,000) and the Company issued Mr. Clemons an option to acquire up to 100,000 Shares of our Common Stock under the Company’s 2014 Omnibus Stock Grant and Option Plan, fully paid and non-assessable at an exercise price of $1.20 per share subject to a vesting schedule. Mr. Clemons has agreed to defer the aforementioned annual salary and accept a consulting fee for the same amount.

On June 15, 2013, we entered into an employment agreement with Wesley Tate. Under the terms of the agreement, Mr. Tate shall be paid an annual salary of One Hundred Five Thousand Dollars ($105,000) and shall be entitled to a bonus of $20,000 upon delivery to the company of a prototype medical device form Sonos Models, Inc. In addition, we also will issue Mr. Tate an option to acquire up to 50,000 Shares of our Common Stock, fully paid and non-assessable at an exercise price of $5.00 per share subject to a vesting schedule. On August 30, 2013, we entered into an addendum to this agreement in which Mr. Tate will be entitled to a stock award of 25,000 shares of our common restricted stock if, within 24 months, there is a reorganization of the company. On April 1, 2014, we entered into an addendum to this agreement in which Mr. Tate was issued stock in the amount of 25,000 of the company’s common restricted shares representing a retention bonus as an incentive for him to remain in the employment of the Company. The Company recorded the $37,500 value of the shares issued as a prepaid expense and will amortize the expense associated with this issuance over a twelve month period. For the period ended December 31, 2014, the company has recognized an expense of approximately $28,000 associated with this issuance. On October 1, 2014, the Company entered into an addendum to the employment agreement with Wesley Tate. Under the terms of the addendum, the agreement has been extended one year until June 15, 2017. Mr. Tate shall be paid an annual salary of One Hundred Fifty Six Thousand Dollars ($156,000) and the Company issued Mr. Tate an option to acquire up to 50,000 Shares of our Common Stock under the Company’s 2014 Omnibus Stock Grant and Option Plan, fully paid and non-assessable at an exercise price of $1.20 per share subject to a vesting schedule. Mr. Tate has agreed to defer the aforementioned annual salary and accept a consulting fee for the same amount.

Contracts

On September 24, 2012, the Company entered into an agreement with Sonos Models, Inc. (“Sonos”) to build up to three medical device prototypes to be used for testing. The agreement calls for a total cash payment of up to $400,000 and the issuance of warrants to purchase up to 65,000 shares of the Company’s common stock, with the cash payments and warrants to be issued in stages once certain developmental thresholds are achieved. Any warrants issued under this agreement will be immediately exercisable, will be eligible for cashless exercise at the option of the holder and will have a term of three years from the date of the issuance and an exercise price based on the fair market value of the stock on the date of completion of the phase (See Note 8). On April 1, 2014, the Company entered into an addendum to the agreement with Sonos. The modifications made to the agreement state that Sonos shall receive 325,000 restricted shares of the Company’s common stock for Services provided to the Company. The warrants that were to be issued for Phase 4 will not be issued and will not be due. In addition, the Company committed to pay Sonos up to One Million Dollars ($1,000,000) for Research and Development costs. The Company recorded the $487,500 value of the shares issued as a prepaid expense and is amortizing the expense associated with these issuances over a twelve-month period. For the six and three month periods ended December 31, 2014, the Company has recognized an expense of approximately $244,000 and $122,000, respectively, associated with this agreement. The unamortized portion of this contract is approximately $122,000 and included in prepaid expenses on the balance sheet.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

Consulting Agreements

The Company has consulting agreements with various individuals to provide assistance to the Company in several areas including the marketing of its biomedical products upon the availability of the device, capital markets and marketing strategies, advertising services and assistance in the introduction of the Company to medical device testing organization and to facilitate access to doctors in numerous countries, including Poland, Uzbekistan and China. They were compensated an aggregate 491,000 shares of the Company’s common stock. These contracts are for twelve months beginning between December 2013 and December 2014 and may be renewed or extended for any period as may be agreed by the parties. As of December 31, 2014 the Company has extended some of the contracts for an additional year. Any of the parties may terminate their respective agreement by providing thirty (30) days written notice of such termination. The Company has recognized $30,000 in accounts payable which is in arrears with one contractual obligation and is in discussions with the consultant to renegotiate the terms of the contract. As these contracts are for a period of up to twelve months, the Company recorded the $1,733,500 value of the shares issued as a prepaid expense and is amortizing the expense associated with these issuances over a twelve month period. For the six and three month periods ended December 31, 2014 and 2013, the Company recognized an expense of approximately $206,000 and $625,000 and $97,000 and $328,000, respectively, associated with these agreements. The unamortized portions of these contracts are approximately $116,000 and included in prepaid expenses on the balance sheet at December 31, 2014.

The Company has entered into service agreements with various individuals. They were compensated an aggregate 75,000 shares of the Company’s common stock. These agreements are for twelve and twenty four months beginning between December 2013 and April 2014. As these agreements are for a period of twelve and twenty four months, the Company recorded the $172,500 value of the shares issued as a prepaid expense and is amortizing the expense associated with these issuances over a twelve and twenty four month period. For the six and three month periods ended December 31, 2014 and 2013, the Company recognized an expense of approximately $52,000 and $0 and $26,000 and $0, respectively, associated with these agreements. The unamortized portions of these agreements are approximately $71,000 and included in prepaid expenses on the balance sheet at December 31, 2014.

The Company has entered into consulting agreements with two individuals to provide business consulting services. For compensation of these services, they were issued an option to acquire up to 100,000 Shares of our Common Stock, fully paid and non-assessable at an exercise price of $1.30 per share. These agreements are for twelve months beginning December 2014 (See Note 8).

As of December 31, 2014, future maturities of prepaid expenses on value of shares issued for consulting are as follows:

Fiscal year ending June 30,

2015	$	246,508
2016	$	62,883
Total	$	309,391

Legal

The Company is not involved in any legal matters arising in the normal course of business. While incapable of estimation, in the opinion of the management, the individual regulatory and legal matters in which it might involve in the future are not expected to have a material adverse effect on the Company’s financial position, results of operations, or cash flows.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

NOTE 5 – PATENT RIGHTS

On June 10, 2010, the Company entered into a Patent License Agreement under which the Company acquired the exclusive rights to certain intellectual property related to using Omentum for treating dementia conditions. Under the agreement the Company has paid rights fees of $50,000 to Dr. Saini, and the Company issued Dr. Saini 825,000 shares of our common stock, valued at $6,600 (based on the fair market value on the date of grant) restricted in accordance with Rule 144. In addition, Dr. Saini will have the option to participate in the sale of equity by the Company in the future, up to ten percent (10%) of the money raised, in exchange for the applicable number of his shares.

In addition, the Patent License agreement provides for a royalty payment of six (6) percent of the value of the net sales, as defined, generated from the sale of licensed products. The agreement also provides for yearly minimum royalty payments of $50,000 for each of the fourth, fifth, and sixth anniversary of the date of the agreement, and a yearly minimum royalty payment of $100,000 for each year thereafter during the term of the agreement. The Company has recognized costs associated with the patent rights for $50,000 in accounts payable for the patent rights and is currently in arrears and in discussions to renegotiate the terms of the agreement. The term of the agreement shall continue until the patent in the intellectual property expires, unless terminated sooner under the provisions of the agreement, as defined.

The patent will have an estimated useful life of 20 years based on the term of the patent. Amortization of the patent will begin when the patent is issued by the United States Patent and Trademark Office and put in use.

Legal fees pertaining to the patent are recorded as general and administrative expenses when they are incurred. Legal fees charged to operations were approximately $11,000 and $6,000 for the six months ended December 31, 2014 and 2013, respectively and $11,000 and $6,000 for the three months ended December 31, 2014, and 2013, respectively.

The accrued payable of $50,000 pertaining to the rights fees at June 30, 2014 is included in related party payables.

NOTE 6 – NOTES PAYABLE TO STOCKHOLDERS

Short Term Note Payable

On June 30, 2013, the Company converted $84,915 of related party payables owed under consulting agreements, into related party notes payable. The notes matured on December 31, 2013 and accrued interest at two (2.0) percent per annum at maturity. On June 16, 2014, the Company converted $30,694 of related party notes payable to common stock. On September 30, 2014, the company converted $31,153 of related party notes payable to common stock. As of September 30, 2014, the outstanding balance of this note is $0.

On January 18, 2013, the Company converted $356,700 of related party payables owed under consulting agreements, into related party notes payable. The notes were scheduled to mature on December 31, 2013 and accrued interest at seven and one-half (7.5) percent per annum at maturity. However, on December 30, 2013, the Company converted $219,700 of related party notes payable to equity. As of December 31, 2014, the outstanding balance of the related party notes payable is $113,000. The Company is currently in default and is in discussions with the noteholder to restructure the terms of the note.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

Long Term Note Payable

Convertible Note Payable

The Company has entered into various unsecured convertible promissory notes with non-affiliate stockholders totaling $1,727,500. Of this amount, $1,502,500 of notes was outstanding at June 30, 2014, and the remainder was issued during the six month period ended December 31, 2014. The principal amounts of these notes are between $10,000 and $1,450,000. Under the terms of these notes, they mature between June 2015 and December 2016, accrue interest at between 7.5% and 8.0% per annum, and are convertible into shares of our common stock at a conversion rates of between $1.00 and $5.00 per share, but only if such conversion would not cause the Noteholders to own more than 9.9% of our outstanding common stock, and contains piggyback registration rights. The Company used a recent sale of stock to determine the fair market value of these transactions. The issuances were exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investors were sophisticated and familiar with our operations at the time of the issuance of the shares. In December 2014, the company converted $25,000 of convertible notes payable and issued 12,891 shares of restricted stock (See Note 7). In addition, the Company issued to a holder 50,000 shares of the company’s common stock (See Note 4).

To properly account for certain Convertible Promissory Notes, the Company performed a detailed analysis to obtain a thorough understanding of the transactions, including understanding the terms of each instrument issued, and any related derivatives entered into. The Company first reviewed ASC Topic 815, to identify whether any equity-linked features in the Notes are freestanding or embedded. The Company determined that there were no free standing features. The Notes were then analyzed in accordance with Topic 815 to determine if the Note should be accounted for at fair value and remeasured at fair value in income. The Company determined that the Notes did not meet the requirements of Topic 815 and therefore accounted for the Notes as conventional debt. The Company then reviewed ASC Topic 470-20, and determined that some of Notes met the criteria of a conventional convertible note and that the Note had a beneficial conversion feature, which was recorded as a debt discount against the face amount of the Note, indicated above.

Accrued interest on all notes payable to stockholders and other related parties at December 31, 2014 totaled approximately $200,000 and is included in related party payables.

As of December 31, 2014, future maturities of notes payable are as follows:

Fiscal year ending June 30,

2015	$	47,500
2016	$	1,680,000
Total	$	1,727,500

NOTE 7 – Stock Transaction

For the six month period ended December 31, 2014, the Company entered into various stock purchase agreements with third parties between July and September of 2014, under which we issued 89,799 shares of our common stock, restricted in accordance with Rule 144, in exchange for $135,300. The stock purchase agreements include piggyback registration rights. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investor was sophisticated and familiar with our operations at the time of the issuance of the shares.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

In December 2014, we issued 12,891 shares of our common stock to an individual for conversion of a convertible note payable and related interest payable. The aggregate Fair Market Value of these shares was $25,781 as the conversion price was $2.00 per share. This issuance was completed in accordance with Section 4(2) of the Securities Act in an offering without any public offering or distribution. These shares are restricted securities and include an appropriate restrictive legend.

In September 2014, we issued 48,435 shares of our common stock to an individual as payment for related party notes and accounts payable. The aggregate Fair Market Value of these shares was $72,653 as the agreed price was $1.50 per share. This issuance was completed in accordance with Section 4(2) of the Securities Act in an offering without any public offering or distribution. These shares are restricted securities and include an appropriate restrictive legend.

For the six month period ended December 31, 2014, the Company issued 120,000 shares of common stock to various individuals as payment for consulting services per contracts dated between July and December 2104. The aggregate Fair Market Value of these shares was approximately $122,000 as the fair market value of the stock was between $0.90 and $1.09 per share. The Company used a recent sale of stock to determine the fair market value of these transactions. These issuances were completed in accordance with Section 4(2) of the Securities Act in an offering without any public offering or distribution. These shares are restricted securities and include an appropriate restrictive legend.

On November 26, 2014, the Company issued a Private Placement Memorandum (“PPM”). The PPM authorizes the sale of up to 4,000,000 units, with each Unit consisting of one share of our common stock and a Warrant to purchase one share of our common stock, at a price of $1.25 per Unit. Each Unit includes a non-cashless Warrant to purchase one (1) share of the Company’s common stock, $.001 par value, at the exercise price of $2.50 per share. The Offering will terminate on or before February 26, 105 unless extended one or more times by us to a date not later than March 26, 2015. As of December 31, 2014, the Company has received no subscriptions.

NOTE 8 – OPTIONS AND WARRANTS

Options

In December 2014, the Company entered into consulting agreements with two individuals (See Note 4). The agreements call for an issuance of options to purchase up to a total of 100,000 shares of the Company’s common stock at an exercise price of $1.30 per share. Fair Market Value of these options totaled approximately $83,500. The options were valued using the Black-Scholes value option pricing model with the following inputs: volatility of 100%; risk-free interest rate of 0.49%; expected term of 2 years; and 0% dividend yield. As of December 31, 2014, 100,000 options to purchase the Company’s common stock have vested. For the six and three month periods ended December 31, 2014 and 2013, the Company recognized an expense of approximately $6,954 and $0, respectively. The expense expected to be recognized is approximately $76,496.

In October 2014, the Company entered into employee agreements addendums with two individuals (See Note 4). The agreements call for an issuance of options to purchase up to a total of 150,000 shares of the Company’s common stock at an exercise price of $1.20 per share, subject to a vesting schedule. Fair Market Value of these options totaled approximately $134,000. The options were valued using the Black-Scholes value option pricing model with the following inputs: volatility of 100%; risk-free interest rate of 1.69%; expected term of 5 years; and 0% dividend yield. As of December 31, 2014, 30,000 options to purchase the Company’s common stock have vested. For the six and three month periods ended December 31, 2014 and 2013, the Company recognized an expense of approximately $33,500 and $0, respectively. The compensation expected to be recognized in future years is approximately $100,500.

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

In June 2013, the Company entered into employee agreements with two individuals (See Note 4). The agreements call for an issuance of options to purchase up to a total of 150,000 shares of the Company’s common stock at an exercise price of $5.00 per share, subject to a vesting schedule. Fair Market Value of these options totaled approximately $1.2 million. The options were valued using the Black-Scholes value option pricing model with the following inputs: volatility of 100%; risk-free interest rate of 1.04%; expected term of 5 years; and 0% dividend yield. As of December 31, 2014, 60,000 options to purchase the Company’s common stock have vested. For the six and three month periods ended December 31, 2014 and 2013, the Company recognized an expense of approximately $123,000 and $123,000 and $62,000 and $62,000, respectively. The compensation expected to be recognized in future years is approximately $616,000.

The following represents a summary of the Options outstanding at December 31, 2014 and changes during the periods then ended:

	Options		Options Average Exercise Price

Outstanding June 30, 2013	$	150,000	$	5.00
Granted		-		-
Exercised		-		-
Expired/Forfeited		-		-
Outstanding, June 30, 2014	$	150,000	$	5.00
Granted		250,000		1.24
Exercised		-		-
Expired/Forfeited		-		-
Outstanding, December 31, 2014	$	400,000	$	2.65
Exercisable at December 31, 2014	$	190,000	$	2.45
Expected to be vested	$	400,000	$	2.65
Compensation to be recognized	$	793,246	$	-
Forfeiture Rate	$	-	$	-

Warrants

On December 11, 2013, the Company issued Sonos warrants to purchase 20,000 shares of the Company’s common stock, valued at $65,660 (based on the fair market value of the date of grant). The Company recognized an expense of $49,200 as research and development during the three months ended September 30, 2013 related to 10,000 of these warrants to be issued for completion of phases 1b and 2 during that period. The fair value was determined using Black-Scholes option pricing model with a volatility of 100%, a risk free interest rate of 1.04% and 0% dividend yield. The Company has recognized no research and development costs related to issued warrants during the six months ended December 31, 2014. The warrants are immediately exercisable, cashless at the option of the holder, and have a term of three years and an exercise price of $2.00 per share.

The following represents a summary of the Warrants outstanding at December 31, 2014 and changes during the periods then ended:

	Warrants			Weighted Average Exercise Price
Outstanding, June 30, 2013		6,250		$	3.20
Granted		20,000			2.00
Exercised		-			-
Expired/Forfeited		(1,250	)		8.00
Outstanding, June 30, 2014		25,000		$	2.00
Granted		-			-
Exercised		-			-
Expired/Forfeited		-			-
Outstanding, December 31, 2014		25,000			2.00
Exercisable at December 31, 2014		25,000		$	2.00

CEREBAIN BIOTECH CORP. AND SUBSIDIARY

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2014 AND 2013

NOTE 9 – RELATED PARTY TRANSACTIONS

Other than as set forth below, and as disclosed in Notes 4, 6, 7, and 8, the Company has not entered into or been a participant in any transaction in which a related person had or will have a direct or indirect material interest.

NOTE 10 – EARNINGS PER SHARE

FASB ASC Topic 260, Earnings Per Share, requires a reconciliation of the numerator and denominator of the basic and diluted earnings (loss) per share (EPS) computations.

The total number of potential additional dilutive options and warrants outstanding was 425,000 and 175,000 for the six and three months ended December 31, 2014 and 2013, respectively. In addition, the convertible notes convert at an exercise price of between $1.00 and $5.00 per share of common stock. The options, warrants and shares underlying the convertible note were considered for the dilutive calculation but in periods where losses are reported, the weighted-average number of common stock outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive.

The following table sets forth the computation of basic and diluted net income per share:

	For The Six Months ended December 31,						For The Three Months ended December 31,
	2014			2013			2014			2013

Net loss attributable to the common stockholders	$	(1,309,951	)	$	(1,580,432	)	$	(676,521	)	$	(854,785	)

Basic weighted average outstanding shares of common stock		4,310,542			3,337,212			4,396,405			3,381,641
Dilutive effect of options and warrants		-			-			-			-
Diluted weighted average common stock and common stock equivalents		4,310,542			3,337,212			4,396,405			3,381,641

Earnings (loss) per share:
Basic and diluted	$	(0.30	)	$	(0.47	)	$	(0.15	)	$	(0.25	)

NOTE 11 – SUBSEQUENT EVENTS

There have been no events which are required to be reported under this Note.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

DISCLAIMER REGARDING FORWARD LOOKING STATEMENTS

Certain statements in this Form 10-Q, which are not statements of historical fact, are what are known as "forward-looking statements," which are basically statements about the future. For that reason, these statements involve risk and uncertainty since no one can accurately predict the future. Words such as "plans," "intends," "hopes," "seeks," "anticipates," "expects," and the like, often identify such forward looking statements, but are not the only indication that a statement is a forward-looking statement. Such forward-looking statements include statements concerning our plans and objectives with respect to our present and future operations, and statements which express or imply that such present and future operations will or may produce revenues, income or profits. These and other factors may cause our actual results to differ materially from any forward-looking statement. We caution you not to place undue reliance on these forward-looking statements. Although we base these forward-looking statements on our expectations, assumptions, and projections about future events, actual events and results may differ materially, and our expectations, assumptions, and projections may prove to be inaccurate. The forward-looking statements speak only as of the date hereof, and we expressly disclaim any obligation to publicly release the results of any revisions to these forward-looking statements to reflect events or circumstances after the date of this filing.

Business Overview

We were incorporated on December 18, 2007, in the State of Nevada. We are a smaller reporting biomedical company and through our wholly owned subsidiary, Cerebain Operating, Inc. (“Cerebain”), our business involves the discovery of products for the treatment of Alzheimer’s disease utilizing Omentum. Under our current plan, our products will include both a medical device solution as well as a synthetic drug solution.

On January 17, 2012, the holders of a majority of our common stock entered into a Stock Purchase Agreement with Cerebain Operating, Inc., a Nevada corporation, under which Cerebain Operating, Inc. agreed to purchase an aggregate of 380,000 shares of our common stock from those shareholders in exchange for $296,000. These shares represented approximately 90% of our outstanding common stock at the time of the transaction (after taking into account the cancellation of 600,000 shares of our common stock by R. Douglas Barton under the Spinoff Agreement as discussed herein). The transaction closed February 9, 2012. Concurrently with the close of the transaction, we closed a transaction with the shareholders of Cerebain whereby we issued 455,680 shares of our common stock in exchange for 22,784,000 shares of Cerebain’s common stock, which represented 100% of Cerebain’s outstanding common stock. In addition, concurrent with these two transactions, we closed a transaction with our primary shareholder, Mr. R. Douglas Barton, whereby we sold all of our then-existing assets to Mr. Barton in exchange for Mr. Barton assuming all of our then-existing liabilities, as well as the return of 600,000 shares of our common stock. The shares were returned by Mr. Barton and were cancelled on our books on February 9, 2012.

As a result of these transactions: (i) Cerebain Operating, Inc. became our wholly-owned subsidiary, (ii) all of our officers and one of our directors resigned immediately, and we appointed one new director and retained new executive officers; and (iii) we changed our business focus from one selling disposable dental supply products at discount prices over the Internet to one focusing on researching, developing, and testing medicinal treatments utilizing Omentum under a patent Cerebain licenses from Dr. Surinder Singh Saini, MD.

On April 15, 2014, we completed the solicitation of votes of stockholders. A majority of our shareholders voted to amend our Articles of Incorporation to change our name to Cerebain Biotech Corp. As a result of this action, we changed the name of our wholly-owned subsidiary to Cerebain Operating Inc. In addition, a majority of our shareholders voted to amend our Articles of Incorporation to effectuate a reverse split of our common stock at a ratio of 1-for-10 and approved the 2014 Cerebain Biotech Corp. Omnibus Stock Grant and Option Plan. The shares of our common stock and our financial information presented in this Quarterly Report on Form 10Q for the quarterly period ended December 31, 2014 are adjusted to reflect the reverse split of our common stock.

Our only operations are conducted through our wholly-owned subsidiary, Cerebain Operating, Inc. The term “we” as used throughout this document refers to Cerebain Biotech Corp. and our wholly-owned subsidiary, Cerebain Operating, Inc

In accordance with our current business plan the testing, research and development of both a medical device solution as well as a synthetic drug solution are underway, and we have contracted with certain third party companies to research, develop, and test certain products that could be used to treat dementia utilizing Omentum. We have also contracted with various individuals to facilitate the introduction of the company to medical device testing organizations in overseas locations including Poland, China and Uzbekistan for the purpose of testing our medicinal treatments utilizing Omentum. Our management anticipates that we may form subsidiaries and affiliates to develop different drugs based on the intellectual property. Although we have contracted with a firm to research, develop and test products that could be used to treat dementia utilizing Omentum, in order to fully execute on that agreement, as well as hire one or more firms to research, develop and test medicinal treatments utilizing Omentum, we will need to raise additional funds. There can be no assurance that further research and development will validate and support the results of our preliminary research and studies. Further, there can be no assurance that the necessary regulatory approvals will be obtained or that we will be able to develop commercially viable products on the basis of our technologies.

Description of Patent License Agreement

On June 10, 2010, we entered into a Patent License Agreement with Dr. Surinder Singh Saini, MD, under which we acquired the exclusive rights to certain intellectual property related to using Omentum for treating dementia conditions. Under the agreement we paid rights fees of $50,000 to Dr. Saini, and we issued Dr. Saini 825,000 shares of our common stock, valued at $6,600 (based on the fair market value on the date of grant) restricted in accordance with Rule 144. As a result Dr. Saini became our largest shareholder. In addition, Dr. Saini has the option to participate in the sale of equity by us in the future, up to ten percent (10%) of the money raised, in exchange for the applicable number of his shares.

Overview of Dementia and Alzheimer’s Disease

Dementia (taken from Latin, originally meaning "madness") is generally referred to as a serious loss and/or decline of human brain function. The areas of brain function affected by dementia include memory, attention, language, problem solving and emotion. Dementia is generally considered as a progressive and non-reversible condition. Alzheimer’s disease is the most common form of dementia. Alzheimer’s disease is an age-related, non-reversible brain disorder that develops over a period of years. Initially, people experience memory loss and confusion, which may be mistaken for the kinds of memory changes that are sometimes associated with normal aging. However, the symptoms of Alzheimer’s disease gradually lead to behavior and personality changes, a decline in cognitive abilities such as decision making and language skills, and problems recognizing family and friends. Alzheimer’s disease ultimately leads to a severe loss of mental functions. These losses are related to the worsening breakdown of the connections between certain neurons in the brain responsible for memory and learning. Neurons can’t survive when they lose their connections to other neurons. As neurons die throughout the brain, the affected regions begin to atrophy, or shrink. By the final stage of Alzheimer’s disease, damage is widespread and brain tissue has shrunk significantly.

Causes

Many scientists generally accept that one or more of the following mechanisms are responsible for dementia:

1) accumulation of toxic materials in brain cells, which leads to death of the cells;

2) reduction of certain biological factors (e.g. Acetylcholine or ACh) in a brain; and

3) loss or reduction of blood flow in the brain.

Neurodegenerative diseases, such as Alzheimer's disease and Parkinson's disease, are the most common causes of dementia. Dementia can also be due to a stroke. In most circumstances, the changes in the brain that are causing dementia cannot be controlled or reversed.

Statistics

· Affected population worldwide

According to the 2010 World Alzheimer Report, in 2010 about 35 million people had dementia worldwide. The report stated that this figure is likely to nearly double every 20 years, to nearly 66 million in 2030 and 115 million in 2050.

According to the Alzheimer’s Association 2014 Alzheimer’s Disease Facts and Figures, an estimated 5.2 million Americans have Alzheimer's disease in 2014, including approximately 200,000 individuals younger than age 65 who have younger-onset Alzheimer's. Almost two-thirds of American seniors living with Alzheimer's are women. Of the 5 million people age 65 and older with Alzheimer's in the United States, 3.2 million are women and 1.8 million are men. The number of Americans with Alzheimer's disease and other dementias is predicted to escalate rapidly in coming years as the baby boom generation ages. By 2050, the number of Americans age 65 and older with Alzheimer's disease may nearly triple, from 5 million to as many as 16 million, barring the development of medical breakthroughs to prevent, slow or stop the disease.

· Cost

According to the 2010 World Alzheimer Report, the global cost of care for dementia will likely exceed $604 billion in 2010, or 1 percent of the world's gross domestic product (GDP). These costs include those attributed to informal care from family member or others, direct social care from professional care givers, and direct medical bills. About 70% of these costs occur in Western Europe and North America. Such costs will continue to increase dramatically as the affected population of dementia increases.

According to the Alzheimer’s Association 2014 Alzheimer’s Disease Facts and Figures, unpaid caregivers are primarily immediate family members, but they may be other relatives and friends. In 2013, 15.5 million family and friends provided an estimated 17.7 billion hours of unpaid care, a contribution to the nation valued at over $220 billion. Eighty percent (80%) of care provided in the community is provided by unpaid caregivers (most often family members), while fewer than ten percent (10%) of older adults receive all of their care from paid caregivers.

· Cost to Nation

According to the Alzheimer’s Association 2014 Alzheimer’s Disease Facts and Figures, Alzheimer’s disease is the most expensive condition in the nation. In 2014, the direct costs to American society of caring for those with Alzheimer's will total an estimated $214 billion, including $150 billion in costs to Medicare and Medicaid. Despite these staggering figures, Alzheimer's will cost an estimated $1.2 trillion (in today's dollars) in 2050. Nearly one in every five dollars spent by Medicare is on people with Alzheimer's or another dementia. The average per-person Medicare spending for those with Alzheimer's and other dementias is three times higher than for those without these conditions. The average per-person Medicaid spending for seniors with Alzheimer's and other dementias is 19 times higher than average per-person Medicaid spending for all other seniors. The financial toll of Alzheimer's on families rivals the costs to Medicaid. Total Medicaid spending for people with Alzheimer's disease is $37 billion and out-of-pocket spending for individuals with Alzheimer's and other dementias is estimated at $36 billion.

Current Approaches to Treating Dementia

Currently, there is no cure for dementia. Certain drugs relieve some of the disease mechanisms (primarily the causes listed as #1 and #2, above) and are often used early in the course of the disease; however, their effects in long-term progression of the disease condition are still unclear. A majority of management of dementia generally focuses on providing emotional and physical support to a patient during the progression of the disease from caregivers or in facilities. While such support is important and necessary to a patient, it is irrelevant to treatment of the disease. Accordingly, an effective method of treatment which may be able to delay the progression of the disease and/or recover damaged brain cells does not presently exist and remains a great need.

Omentum and its Use in Treating Dementia

Omentum Overview

The Omentum is a layer of tissue lying over internal organs (e.g. the intestines) like a blanket. Omentum has the ability to generate biological agents that nourish nerves and help them grow. When such agents identified from the Omentum were tested, they were shown to provoke the growth of new brain cells in areas of the brain affected by Alzheimer's disease. The Omentum tissue can also increase the level of Acetylcholine (ACh) whose reduction is considered as a main cause of brain cell death. Some scientists believe that the ability of the Omentum to provide this important factor (ACh) may be a key to successfully treating dementia. Additionally, the Omentum has been shown to be angiogenic (i.e. to promote new blood vessel growth) in areas of the body lacking blood flow.

Use of Omentum in Treating Dementia

Historically, doctors have utilized Omentum to treat dementia using a procedure called omental transposition. This approach involves a surgical procedure in which the Omentum is surgically lengthened into the brain through the chest, neck and behind the ear. The Omentum is then laid directly on the underlying brain. According to studies conducted by a team in the University of Nevada, School of Medicine, omental transposition not only arrested Alzheimer's disease, but also reversed it, resulting in the patient’s neurologic function being improved. Despite the promising results, this surgical procedure has not been popular because it is very invasive and therefore often causes unwanted complications to a patient, especially in the elderly. Accordingly, a less invasive procedure or a pharmaceutical approach in treatment of dementia remains a significant need.

Agreement with Sonos

In an effort to develop a less invasive procedure in the treatment of dementia, on May 16, 2012, we signed an agreement with medical device product development company Sonos Models, Inc. (“Sonos”) to assess our options for a medical device solution (“Initial Feasibility Study”).

We completed the Initial Feasibility Study and, as a result of the findings, entered into an agreement with Sonos on September 24, 2012 to build up to three medical device prototypes to be used for testing. The agreement calls for a total cash payment of up to $400,000 and the issuance of warrants to purchase up to 65,000 shares of our common stock, with the cash payments and warrants to be issued in stages once certain developmental thresholds are achieved. Any warrants issued under this agreement will be immediately exercisable, will be eligible for cashless exercise at the option of the holder and will have a term of three years from the date of the issuance and an exercise price based on the fair market value of the stock on the date of completion of the phase.

On April 1, 2014, we entered into an addendum to the agreement with Sonos. The addendum stipulated Sonos shall receive 325,000 restricted shares of the company’s common stock for services to be provided to the company. The company recognized a prepaid expense of $487,500, of which $365,625 has been expensed to research and development to date. Specific services to be provided shall be those services originally identified in the Sonos Agreement as Phase 5 – Testing of the device, Phase 6 – Refinements, changes and CAD modeling updates of the design, and Phase 7- Production of or make changes to the device as necessary. The warrants that were to be issued for Phase 4 will not be issued and are null and void. In addition, we committed to pay Sonos up to One Million Dollars ($1,000,000) for research and development costs. Costs will be recognized when incurred. To date, Sonos has been issued 325,000 restricted shares of our common stock, 25,000 warrants to purchase shares of our common stock and paid approximately $154,000.

To date, the results of the research suggest we have options for implantable devices with a bias towards having them as non-invasive as possible. The options are comprised of two electro-stim types that have a multitude of variable test parameters that can be changed and modified externally as the testing facility conducts clinical trials on each patient. It is theorized that if a patient’s response to the Omentum stimulation is successful, the clinical facility should be able to perform various tests for the purpose of setting “markers” for the patient and then perform the standardized cognitive testing for Alzheimer’s patient with the intent of developing a testing matrix. It is our objective to test various methods and modalities with the aim of developing an enormous matrix of input to direct us to the best solution. Our goal is to be less invasive, as small as possible and as simple as possible to reach the broadest patient base. We intend to “Shape and Innovate History” as we visualize and create a solution for this debilitating disease.

Limited Operating History; Need for Additional Capital

There is very limited historical financial information about us on which to base an evaluation of our performance. We are a developmental stage company and have not generated revenues from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, and possible cost overruns due to increases in the cost of services. To become profitable and competitive, we must receive additional capital. We have no assurance that future financing will materialize. If that financing is not available we may be unable to continue operations.

Overview

The following management’s discussion and analysis of financial condition and results of operations (“MD&A”) of Cerebain includes the following sections:

·	Results of Operations

·	Liquidity and Capital Resources

·	Capital Expenditures

·	Fiscal Year End

·	Going Concern

·	Critical Accounting Policies

·	Recent Accounting Pronouncements

·	Off-Balance Sheet Arrangements

·	Inflation

Results of Operations

Three Months Ended December 31, 2014 Compared to Three Months Ended December 31, 2013

Revenue

For the three months ended December 31, 2014 and 2013, we did not generate any revenues.

Operating expenses

Operating expenses decreased by $97,776, or 14.2%, to $589,652 in the three months ended December 31, 2014 from $687,428 in the three months ended December 31, 2013 primarily due to decreases in consultant costs, including costs related to fair value of stock and warrants issued for services and amortization of compensation costs related to stock options, and professional fees.

Operating expenses for the three months ended December 31, 2014 were approximately comprised of marketing costs of $39,000, $238,000 in consulting services costs, research and development costs of $122,000, compensation expense of $104,500, professional fees of $51,000, travel costs of $26,000, and other operating expenses.

Operating expenses for the three months ended December 31, 2013 were approximately comprised of marketing costs of $34,000, $425,000 in consulting services costs, research and development costs of $89,000, compensation expense of $62,000, professional fees of $53,000, travel costs of $17,000, and other operating expenses.

Other income (expenses)

Other expense decreased by $80,489, or 48.1%, to $86,869 in the three months ended December 31, 2014 from $167,357 in the three months ended December 31, 2013 primarily related to a decrease in the accretion of recorded debt discounts related to notes payable issued throughout the year ended June 30, 2014 and in the current year to date offset by an increase in interest expenses.

Net loss before income taxes

Net loss before income taxes for the three months ended December 31, 2014 totaled $676,521 primarily due to marketing costs, consulting services costs, research and development costs, costs related to fair value of stock and warrants issued for services and amortization of compensation costs related to stock options, and professional fees compared to $854,785 for the three months ended December 31, 2013 primarily due to marketing costs, consulting services costs, research and development costs, costs related to fair value of stock and warrants issued for services and amortization of compensation costs related to stock options, and professional fees.

Six Months Ended December 31, 2014 Compared to Six Months Ended December 31, 2013

Revenue

For the six months ended December 31, 2014 and 2013, we did not generate any revenues.

Operating expenses

Operating expenses decreased by $193,738, or 14.8%, to $1,116,630 in the six months ended December 31, 2014 from $1,310,368 in the six months ended December 31, 2013 primarily due to research and development, marketing and consultant costs, including costs related to fair value of stock and warrants issued for services and amortization of compensation costs related to stock options, and professional fees.

Operating expenses for the six months ended December 31, 2014 were approximately comprised of research and development costs of $244,000, $470,000 in consulting services costs; $100,000 in marketing expenses, compensation expense of $175,500, professional fees of $62,500, travel costs of $53,500, and other operating expenses.

Operating expenses for the six months ended December 31, 2013 were comprised of research and development costs of $177,000, $814,000 in consulting services costs; $87,000 in marketing expenses, professional fees of $76,000, travel costs of $35,500, and other operating expenses.

Other income (expenses)

Other expense decreased by $76,743, or 28.4%, to $193,321 in the six months ended December 31, 2014 from $270,064 in the six months ended December 31, 2013 primarily related to a decrease in the accretion of recorded debt discounts related to notes payable issued throughout the year ended June 30, 2014 and in the current year to date offset by an increase in interest expense.

Net loss before income taxes

Net loss before income taxes for the six months ended December 31, 2014 totaled $1,309,951 primarily related to research and development costs, consulting services costs, costs related to fair value of stock and warrants issued for services and amortization of compensation costs related to stock options, and professional fees compared to $1,580,432 for the six months ended December 31, 2013 primarily related to consulting services cost, legal and audit costs and travel costs.

Assets and Liabilities

Assets were $552,210 as of December 31, 2014. Assets consisted of cash of $15,641, prepaid expenses of $402,669, which includes $385,888 for the issuance of stock and options for consulting services and financing fees, and patent rights of $133,900. Liabilities were $2,179,710 as of December 31, 2014. Liabilities consisted of accounts payable of $219,752, related party payable of $347,471, notes payable to related parties of $113,000, and convertible notes to stockholders, net of debt discount, of $1,499,487.

Stockholders’ Deficit

Stockholders’ deficit was $1,627,500 as of December 31, 2014. Stockholder’s deficit consisted primarily of shares issued to founders and recorded as compensation in the amount of $13,900, proceeds from issuance of shares of common stock totaling $956,986, net of issuance costs, beneficial conversion feature associated with convertible note of $829,885, shares associated with warrants, options and issuances for services of $4,029,808 and shares issued for patent rights totaling $6,600, offset primarily by the accumulated deficit of $7,464,679 at December 31, 2014.

Liquidity and Capital Resources

General – Overall, we had an increase in cash flows of $13,953 in the six months ending December 31, 2014 resulting from cash used in operating activities of $371,347, offset partially by cash provided by financing activities of $385,300.

The following is a summary of our cash flows provided by (used in) operating and financing activities during the periods indicated:

	Six Months Ended December 31,
	2014			2013

Cash at beginning of period	$	1,688		$	8
Net cash used in operating activities		(371,347	)		(462,042	)
Net cash provided by financing activities		385,300			566,032
Cash at end of period	$	15,641		$	103,998

Cash Flows from Operating Activities– For the six months ended December 31, 2014, net cash used in operations was $371,347 compared to net cash used in operations of $462,042 for the six months ended December 31, 2013. Net cash used in operations was primarily due to a net loss of $1,309,951 for the six months ended December 31, 2014, stock issued for services of $509,654, accretion of debt discount of $96,186, issuance of options for $156,750, and the changes in operating assets and liabilities of $176,014.

Cash Flows from Financing Activities – Net cash flows provided by financing activities in the six months ending December 31, 2014 was $385,300, compared to net cash provided of $566,032 in the same period in 2013. The increase in net cash provided by financing activities was mainly due to proceeds from notes payable to stockholders of $250,000 and proceeds from issuance of common stock of $135,300.

Financing – We expect that our current working capital position, together with our expected future cash flows from operations will be insufficient to fund our operations in the ordinary course of business, anticipated capital expenditures, debt payment requirements and other contractual obligations for at least the next twelve months. However, this belief is based upon many assumptions and is subject to numerous risks, and we will require additional funding in the future.

We have no present agreements or commitments with respect to any material acquisitions of other businesses, products, product rights or technologies or any other material capital expenditures. However, we will continue to evaluate acquisitions of and/or investments in products, technologies, capital equipment or improvements or companies that complement our business and may make such acquisitions and/or investments in the future. Accordingly, we may need to obtain additional sources of capital in the future to finance any such acquisitions and/or investments. We may not be able to obtain such financing on commercially reasonable terms, if at all. Due to the ongoing global economic crisis, we believe it may be difficult to obtain additional financing if needed. Even if we are able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing, or cause substantial dilution for our stockholders, in the case of equity financing.

Capital Expenditures

Other Capital Expenditures

If we have the funds available, we expect to purchase approximately $30,000 of equipment in connection with the expansion of the business.

Fiscal year end

Cerebain and Cerebain Biotech each has a June 30 fiscal year end.

Going Concern

The accompanying financial statements have been prepared assuming we will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. We had a accumulated deficit of $7,464,679 and $6,154,728 at December 31 and June 30, 2014, respectively, and had a net loss of $1,309,951 and $1,580,432 for the six months ended December 31, 2014 and 2013, respectively, and net cash used in operating activities of $371,347 and $462,042 for the six months ended December 31, 2014 and 2013, respectively, with no revenue earned since inception. These matters, among others, raise substantial doubt about our ability to continue as a going concern.

While we are in the process of developing our medical device solution and our synthetic drug solution for the treatment of dementia, our cash position may not be significant enough to support our daily operations. We intend to raise additional funds by way of a public or private offering. We believe that the actions presently being taken to further implement our business plan and generate revenues provide the opportunity for us to continue as a going concern. While we believe in the viability of our strategy to generate revenues and in our ability to raise additional funds, there can be no assurances to that effect. Our ability to continue as a going concern is dependent upon our ability to further implement our business plan and generate revenues.

The financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

Critical Accounting Policies

The SEC has defined a company’s critical accounting policies as the ones that are most important to the portrayal of the Company’s financial condition and results of operations and which require the Company to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, we have identified the critical accounting policies and judgments addressed below. We also have other key accounting policies that are significant to understanding our results. For additional information, see Note 3 - Summary of Significant Accounting Policies on page 9.

The following are deemed to be the most significant accounting policies affecting the Company.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Measurement, estimates and assumptions are used for, but not limited to, useful lives and residual value of long-lived assets, and the valuation of equity instruments. Management makes these estimates using the best information available at the time the estimates are made; however actual results when ultimately realized could differ from those estimates. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumption.

Income Taxes

We account for income taxes under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 740, Income Taxes (“ASC 740”). Under ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Stock Compensation

In accordance with ASC No. 718, Compensation – Stock Compensation (“ASC 718”), we measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which employees are required to provide services. Share-based compensation arrangements include stock options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans. As such, compensation cost is measured on the date of grant at their fair value. Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant. We apply this statement prospectively. Equity instruments (“instruments”) issued to other than employees are recorded on the basis of the fair value of the instruments, as required by ASC 718. ASC No. 505, Equity Based Payments to Non-Employees (“ASC 505”) defines the measurement date and recognition period for such instruments. In general, the measurement date is (a) when a performance commitment, as defined, is reached or (b) when the earlier of (i) the non-employee performance is complete or (ii) the instruments are vested. The measured value related to the instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in the ASC 505.

Recent Accounting Pronouncements

We have evaluated new accounting pronouncements that have been issued and are not yet effective for us and determined that there are no such pronouncements expected to have an impact on our future financial statements.

Off-Balance Sheet Arrangements

As of December 31, 2014, we have not entered into any transaction, agreement or other contractual arrangement with an entity unconsolidated under which it has:

•	a retained or contingent interest in assets transferred to the unconsolidated entity or similar arrangement that serves as credit;

•	liquidity or market risk support to such entity for such assets;

•	an obligation, including a contingent obligation, under a contract that would be accounted for as a derivative instrument; or

•

an obligation, including a contingent obligation, arising out of a variable interest in an unconsolidated entity that is held by, and material to the Company, where such entity provides financing, liquidity, market risk or credit risk support to or engages in leasing, hedging, or research and development services with us.

The following table sets forth our current contractual obligations as of December 31, 2014:

	Payments due by period
Contractual Obligations	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Long Term Debt	$	1,727,500	$	47,500	$	1,680,000		-		-
Operating Leases	$	6,965	$	2,189	$	4,776		-		-
Total	$	1,734,465	$	49,689	$	1,684,776		-		-

Inflation

Management believes that inflation has not had a material effect on the Company’s results of operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a Smaller Reporting Company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-l5(e) under the Exchange Act) that are designed to ensure that information that would be required to be disclosed in Exchange Act reports is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including to our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As required by Rule 13a-15 under the Exchange Act, our management, including our Chief Executive Officer (our Principal Executive Officer) and Chief Financial Officer (our Principal Financial Officer), evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2014. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that as of December 31, 2014, and as of the date that the evaluation of the effectiveness of our disclosure controls and procedures was completed, our disclosure controls and procedures were not effective to satisfy the objectives for which they are intended.

Management’s Report on Internal Controls over Financial Reporting

Our management is responsible for establishing and maintaining effective internal control over financial reporting (as defined in Rule 13a-l5(f) of the Securities Exchange Act). Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2014. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on that assessment, management believes that, as of December 31, 2014, the Company’s internal control over financial reporting was ineffective based on the COSO criteria, due to the following material weaknesses listed below.

Insufficient segregation of duties in our finance and accounting functions due to limited personnel. During the six months ended December 31, 2014, we internally performed all aspects of our financial reporting process, including, but not limited to, access to the underlying accounting records and systems, the ability to post and record journal entries and responsibility for the preparation of the financial statements. Due to the fact these duties were performed by the same person, a lack of review was created over the financial reporting process that might result in a failure to detect errors in spreadsheets, calculations, or assumptions used to compile the financial statements and related disclosures as filed with the SEC.

Insufficient corporate governance policies. Our corporate governance activities and processes are not always formally documented nor are they reviewed and approved by anyone other than the Chief Financial Officer.

These control deficiencies could result in a material misstatement to our interim or annual financial statements that would not be prevented or detected.

When we are financially able, we intend to take appropriate and reasonable steps to make the necessary improvements to remediate these deficiencies and we intend to consider the results of our remediation efforts and related testing as part of our next assessment of the effectiveness of our internal control over financial reporting.

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting during the period ending December 31, 2014, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not involved in any legal matters arising in the normal course of business. While incapable of estimation, in the opinion of the management, the individual regulatory and legal matters in which it might involve in the future are not expected to have a material adverse effect on our financial position, results of operations, or cash flows.

ITEM 1A. RISK FACTORS

There have been no changes to our Risk Factors included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on August 11, 2014.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

For the six month period ended December 31, 2014, we entered into various stock purchase agreements with third parties between July and September of 2014, under which we issued 89,799 shares of our common stock, restricted in accordance with Rule 144, in exchange for $135,300. The stock purchase agreements include piggyback registration rights. The issuances were exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investors were sophisticated and familiar with our operations at the time of the issuance of the shares.

For the six month period ended December 31, 2014, we issued 120,000 shares of common stock to various individuals as payment for consulting services per contracts dated between July 2014 and December 2014. The aggregate Fair Market Value of these shares was $122,000 as the fair market value of the stock was between $0.90 and $1.09 per share. We used a recent sale of stock to determine the fair market value of these transactions. These issuances were completed in accordance with Section 4(2) of the Securities Act in an offering without any public offering or distribution to individuals that are familiar with our operations. These shares are restricted securities and include an appropriate restrictive legend.

On September 30, 2014, we issued 48,435 shares of our common stock to Mr. Eric Clemons, our Chief Executive Officer as payment for related party notes and accounts payable. The aggregate Fair Market Value of these shares was $72,653 as the agreed price was $1.50 per share. This issuance was completed in accordance with Section 4(2) of the Securities Act in an offering without any public offering or distribution to an individual that is familiar with our operations. These shares are restricted securities and include an appropriate restrictive legend.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

There have been no events which are required to be reported under this Item.

ITEM 4. MINING SAFETY DISCLOSURES

There have been no events which are required to be reported under this Item.

ITEM 5. OTHER INFORMATION

There have been no events which are required to be reported under this Item.

ITEM 6. EXHIBITS

Item No.		Description

3.1 (1)		Articles of Incorporation of Cerebain Biotech Corp., a Nevada corporation, filed with the Secretary of State for the State of Nevada on December 18, 2007

3.2 (1)		Bylaws of Cerebain Biotech Corp., a Nevada corporation

10.1 (1)		Agreement by and between Cerebain Biotech Corp. and R. Douglas Barton dated January 2, 2009

10.2 (1)		Agreement by and between Cerebain Biotech Corp. and R. Douglas Barton dated January 2, 2009

10.3 (2)		Share Exchange Agreement by and between Cerebain Biotech Corp. and the shareholders of Cerebain Operating, Inc. dated January 17, 2012

10.4 (2)		Spinoff Agreement by and between Cerebain Biotech Corp. and R. Douglas Barton dated January 17, 2012

10.5 (2)		Stock Purchase Agreement by and between Cerebain Operating, Inc. and certain shareholders of Cerebain Biotech Corp. dated January 17, 2012

10.6 (2)		Patent License Agreement by and between Cerebain Operating, Inc. and Dr. Surinder Singh Saini dated June 10, 2010

10.7 (3)		Letter Agreement with Sonos Models, Inc. dated September 24, 2012

10.8 (4)		$240,000 Principal Amount Convertible Promissory Note dated June 18, 2012

10.9 (6)		$235,000 Amended and Consolidated Promissory Note dated November 1, 2012

10.10 (5)		Termination Agreement and General Release with Gerald A. DeCiccio dated January 18, 2013

10.11 (5)		Termination Agreement and General Release with Eric Clemons dated January 18, 2013

10.12 (5)		Termination Agreement and General Release with Paul Sandhu dated January 18, 2013

10.13 (5)		Promissory Note Issued to Gerald A. DeCiccio dated January 18, 2013

10.14 (5)		Promissory Note Issued to Eric Clemons dated January 18, 2013

10.15 (5)		Promissory Note Issued to Paul Sandhu dated January 18, 2013

10.16 (7)		$600,000 Amended and Consolidated Promissory Note dated March 14, 2013

10.17 (8)		Employment Agreement with Eric Clemons dated June 15, 2013

10.18 (8)		Employment Agreement with Wesley Tate dated June 15, 2013

10.19 (8)		Consulting Agreement with Gerald DeCiccio dated June 15, 2013

10.20 (8)		Consulting Agreement with IDC Consulting & Investors LLC dated April 15, 2013

10.21 (10)		Consulting Agreement with Superior Inc. dated October 15, 2013

10.22 (10)		$970,000 Amended and Consolidated Promissory Note dated October 15, 2013

10.23 (9)		Stock Purchase Agreement with Eric Clemons from Conversion of Debt dated December 30, 2013

10.24 (9)		Stock Purchase Agreement with Gerald DeCiccio from Conversion of Debt dated December 30, 2013

10.25 (11)		$1,245,000 Amended and Consolidated Promissory Note dated February 25, 2014

10.26 (12)		Resignation of Gerald DeCiccio from Board of Directors dated June 10, 2014

10.27 (14)		$1,345,000 Amended and Consolidated Promissory Note dated May 29, 2014

10.28 (14)		Stock Purchase Agreement with Wesley Tate from Conversion of Debt dated June 16, 2014

10.29 (13)		2014 Cerebain Biotech Corp. Omnibus Stock Grant and Option Plan

14 (1)		Code of Ethics of Cerebain Biotech Corp.

21 (14)		Cerebain Biotech Corps. Domestic and International Subsidiaries

31.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934 as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2003. *

31.2		Certification of the Chief Financial Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934 as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2003. *

32.1		Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2003. *

32.2		Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2003. *

101**		Interactive Data File (Form 10-Q for the three and six months ended December 31, 2014 furnished in XBRL).

101.INS		Interactive Data File (Form 10-Q for the three and six months ended December 31, 2014 furnished in XBRL).

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

________________

*	filed herewith

**	Furnished herewith. Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of any registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise are not subject to liability under those sections

(1)	Incorporated by reference from our Registration Statement on Form S-1 filed with the Commission on January 27, 2009.

(2)	Incorporated by reference from our Form 8-K filed with the Commission on February 10, 2012.

(3)	Incorporated by reference from our Form 8-K filed with the Commission on September 28, 2012.

(4)	Incorporated by reference from our Form 10-Q filed with the Commission on November 14, 2012.

(5)	Incorporated by reference from our Form 8-K filed with the Commission on January 24, 2013.

(6)	Incorporated by reference from our Form 10Q filed with the Commission on February 12, 2013.

(7)	Incorporated by reference from our Form 10-Q filed with the Commission on May 3, 2013.

(8)	Incorporated by reference from our Form 10K/A filed with the Commission on October 4, 2013.

(9)	Incorporated by reference from our Form 8-K filed with the Commission on January 6, 2014.

(10)	Incorporated by reference from our Form 10-Q filed with the Commission on February 10, 2014.

(11)	Incorporated by reference from our Form 10-Q filed with the Commission on May 14, 2014.

(12)	Incorporated by reference from our Form 8-K filed with the Commission on May 11, 2014.

(13)	Incorporated by reference from our Form DEF 14A filed with the Commission on March 14, 2014.

(14)	Incorporated by reference from our Form 10K filed with the Commission on August 11, 2014.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Cerebain Biotech Corp. A Nevada corporation

Date: February 17, 2015	By:	/s/ Eric Clemons
		Eric Clemons, President (Principal Executive Officer)

	By:	/s/ Wesley Tate
		Wesley Tate, Chief Financial Officer (Principal Financial and Accounting Officer)

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