Attached files
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark
One)
[X]
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 30, 2018
[ ]
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _______________ to
_______________.
Commission File Number: 000-54563
PREMIER BIOMEDICAL, INC.
(Exact name of registrant as specified in its charter)
Nevada
(State or other jurisdiction of
incorporation or organization)
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27-2635666
(I.R.S. Employer
Identification No.)
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P.O. Box 25
Jackson Center, PA
(Address of principal executive offices)
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16133
(Zip Code)
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Registrant’s telephone number,
including area code (814) 786-8849
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 XNo
Indicate by check mark whether the registrant has
submitted electronically and posted on its corporate Website, 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
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☐
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☑
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(Do not
check if a smaller reporting company)
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Emerging growth company
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☑
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If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange
Act. ☐
Indicate by check mark whether the registrant is a
shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes
No X
As
of November 26, 2018, there were 4,812,667 shares of common stock,
$0.00001 par value, issued and outstanding.
PREMIER BIOMEDICAL, INC.
TABLE OF CONTENTS
PART I – FINANCIAL INFORMATION
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3
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ITEM 1 Financial Statements
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3
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ITEM 2 Management’s Discussion and Analysis of
Financial Condition and Results of Operations
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18
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ITEM 3 Quantitative and Qualitative Disclosures About
Market Risk
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24
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ITEM 4 Controls and Procedures
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24
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PART II – OTHER INFORMATION
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26
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ITEM 1 Legal
Proceedings
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26
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ITEM 1A Risk
Factors
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26
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ITEM 2 Unregistered Sales of Equity Securities and Use of
Proceeds
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26
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ITEM 3 Defaults Upon Senior
Securities
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27
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ITEM 4 Mine
Safety Disclosures
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27
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ITEM 5 Other
Information
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27
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ITEM 6 Exhibits
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28
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2
This Quarterly Report includes forward-looking
statements within the meaning of the Securities Exchange Act of
1934 (the “Exchange Act”). These statements are based
on management’s beliefs and assumptions, and on information
currently available to management. Forward-looking statements
include the information concerning our possible or assumed future
results of operations set forth under the heading:
“Management’s Discussion and Analysis of
Financial Condition and Results of Operations.”
Forward-looking statements also include statements in which words
such as “expect,” “anticipate,”
“intend,” “plan,” “believe,”
“estimate,” “consider” or similar
expressions are used.
Forward-looking
statements are not guarantees of future performance. They involve
risks, uncertainties and assumptions.
Our future results and shareholder values may differ materially
from those expressed in these forward-looking statements. Readers
are cautioned not to put undue reliance on any forward-looking
statements.
3
ITEM
1 Financial
Statements
PREMIER BIOMEDICAL, INC.
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CONDENSED CONSOLIDATED BALANCE SHEETS
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September
30,
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December
31,
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2018
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2017
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ASSETS
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(Unaudited)
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Current
assets:
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Cash
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$63,204
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$83,704
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Accounts
receivable
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1,966
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312
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Inventory
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119,155
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84,763
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Other current
assets
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38,066
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34,824
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Total current
assets
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222,391
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203,603
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Property and
equipment, net
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5,758
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5,478
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Total
assets
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$228,149
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$209,081
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LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
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Current
liabilities:
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Accounts
payable
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$307,027
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$346,814
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Accounts payable,
related parties
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30,939
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41,382
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Accrued
interest
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21,721
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5,840
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Convertible notes
payable, net of discounts of $60,211 and $30,010 at
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September 30, 2018
and December 31, 2017, respectively, currently in
default
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304,269
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169,990
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Derivative
liabilities
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1,807,945
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2,255,781
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Total current
liabilities
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2,471,901
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2,819,807
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Total
liabilities
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2,471,901
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2,819,807
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Commitments and
contingencies
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-
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-
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Stockholders'
equity (deficit):
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Preferred stock,
$0.001 par value, 10,000,000 shares
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authorized,
2,000,000 shares issued and outstanding
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at September 30,
2018 and December 31, 2017
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2,000
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2,000
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Common stock,
$0.00001 par value, 1,000,000,000 shares
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authorized,
3,773,849 and 2,551,363 shares issued and
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outstanding at
September 30, 2018 and December 31, 2017, respectively
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38
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26
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Additional paid in
capital
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13,967,739
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13,442,255
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Subscriptions
payable, consisting of 172,176 and 254,703 shares
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at September 30,
2018 and December 31, 2017, respectively
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12,500
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273,805
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Accumulated
deficit
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(16,226,029)
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(16,328,812)
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Total stockholders'
equity (deficit)
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(2,243,752)
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(2,610,726)
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Total liabilities
and stockholders' equity (deficit)
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$228,149
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$209,081
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See
accompanying notes to financial statements.
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4
PREMIER
BIOMEDICAL, INC.
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CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
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(Unaudited)
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For the Three
Months
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For the Nine
Months
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Ended September
30,
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Ended September
30,
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2018
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2017
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2018
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2017
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Revenue
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$8,225
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$24,276
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$30,709
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$24,276
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Cost of goods
sold
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4,373
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11,070
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20,577
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11,070
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Gross
profit
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3,852
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13,206
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10,132
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13,206
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Operating
expenses:
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Research and
development
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-
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184,315
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-
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184,315
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General and
administrative
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62,572
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36,979
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139,881
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110,284
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Professional
fees
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22,613
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22,269
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100,953
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109,025
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Total operating
expenses
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85,185
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243,563
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240,834
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403,624
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Net operating
loss
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(81,333)
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(230,357)
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(230,702)
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(390,418)
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Other income
(expense):
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Interest
expense
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(184,624)
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(37,124)
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(322,323)
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(190,471)
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Change in
derivative liabilities
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(97,578)
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3,993,216
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655,808
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(2,267,885)
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Equity in losses of
investment in joint venture
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-
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(4,174)
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-
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(6,232)
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Total other income
(expense)
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(282,202)
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3,951,918
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333,485
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(2,464,588)
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Net income
(loss)
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$(363,535)
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$3,721,561
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$102,783
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$(2,855,006)
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Weighted average
number of common shares outstanding - basic
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3,306,069
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2,018,791
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3,058,442
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1,879,057
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Weighted average
number of common shares outstanding - fully diluted
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3,306,069
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2,030,778
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3,070,392
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1,879,057
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Net income (loss)
per share - basic
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$(0.11)
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$1.83
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$0.03
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$(1.52)
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Net income (loss)
per share - fully diluted
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$(0.11)
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$1.83
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$0.03
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$(1.52)
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See
accompanying notes to financial statements.
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5
PREMIER
BIOMEDICAL, INC.
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CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
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(Unaudited)
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For the Nine
Months
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Ended September
30,
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2018
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2017
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CASH
FLOWS FROM OPERATING ACTIVITIES
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Net income
(loss)
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$102,783
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$(2,855,006)
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Adjustments to
reconcile net income (loss)
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to net cash used in
operating activities:
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Depreciation
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1,749
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1,854
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Change in fair
market value of derivative liabilities
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(655,808)
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2,267,885
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Amortization of
debt discounts
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306,442
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184,237
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Decrease (increase)
in assets:
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Accounts
receivable
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(1,654)
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(834)
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Inventory
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(34,392)
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(108,006)
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Other current
assets
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(3,242)
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3,995
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Increase (decrease)
in liabilities:
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Accounts
payable
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(39,787)
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129,337
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Accounts payable,
related parties
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(10,443)
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(245)
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Accrued
interest
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15,881
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4,434
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Accrued interest,
related parties
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-
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1,800
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Net cash used in
operating activities
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(318,471)
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(370,549)
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CASH
FLOWS FROM INVESTING ACTIVITIES
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Purchases of
property and equipment
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(2,029)
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(2,694)
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Net cash used in
investing activities
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(2,029)
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(2,694)
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CASH
FLOWS FROM FINANCING ACTIVITIES
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Proceeds from sale
of stock, net of offering costs
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-
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285,000
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Proceeds from sale
of stock on equity line of credit
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-
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18,323
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Proceeds from
convertible notes payable
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300,000
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150,000
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Net cash provided
by financing activities
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300,000
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453,323
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NET CHANGE IN
CASH
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(20,500)
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80,080
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CASH AT BEGINNING
OF PERIOD
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83,704
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22,437
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CASH AT END OF
PERIOD
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$63,204
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$102,517
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SUPPLEMENTAL
INFORMATION:
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Interest
paid
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$-
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$-
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Income taxes
paid
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$-
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$-
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NON-CASH INVESTING
AND FINANCING ACTIVITIES:
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Value of debt
discounts
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$300,000
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$115,631
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Value of derivative
adjustment due to debt conversions
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$128,671
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$229,043
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Value of shares
issued for conversion of debt
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$135,520
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$323,197
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See
accompanying notes to financial statements.
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{01436244-2
}
6
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
Note 1 – Basis of Presentation and Significant Accounting
Policies
Basis of Presentation
The
accompanying unaudited, condensed financial statements of Premier
Biomedical, Inc. (“the Company”) have been prepared
pursuant to rules and regulations of the Securities and Exchange
Commission (“SEC”) and, therefore, do not include all
information and footnote disclosures normally included in audited
financial statements. However, these statements reflect all
adjustments, consisting of normal recurring adjustments, which in
the opinion of management are necessary for fair presentation of
the information contained therein. It is suggested that these
statements be read in conjunction with the financial statements
included in the Company’s Annual Report on Form 10-K for
the year ended December 31, 2017.
Use of Estimates
The
preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, and the disclosure of
contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Cash and Cash Equivalents
We
maintain cash balances in non-interest-bearing accounts, which do
not currently exceed federally insured limits. For the purpose of
the statements of cash flows, all highly liquid investments with an
original maturity of three months or less are considered to be cash
equivalents.
Patent Rights and Applications
Patent
rights and applications costs include the acquisition costs and
costs incurred for the filing of patents. Patent rights and
applications are amortized on a straight-line basis over the legal
life of the patent rights beginning at the time the patents are
approved. Patent costs for unsuccessful patent applications are
expensed when the application is terminated.
Fair Value of Financial Instruments
Under
FASB ASC 820-10-05, the Financial Accounting Standards Board
establishes a framework for measuring fair value in generally
accepted accounting principles and expands disclosures about fair
value measurements. This Statement reaffirms that fair value is the
relevant measurement attribute. The adoption of this standard did
not have a material effect on the Company’s financial
statements as reflected herein. The carrying amounts of cash,
prepaid expenses and accrued expenses reported on the balance sheet
are estimated by management to approximate fair value primarily due
to the short term nature of the instruments.
Basic and Diluted Loss Per Share
Basic
earnings per share (“EPS”) are computed by dividing net
income (the numerator) by the weighted average number of common
shares outstanding for the period (the denominator). Diluted EPS is
computed by dividing net income by the weighted average number of
common shares and potential common shares outstanding (if dilutive)
during each period. Potential common shares include stock options,
warrants and restricted stock. The number of potential common
shares outstanding relating to stock options, warrants and
restricted stock is computed using the treasury stock
method.
7
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
The
reconciliation of the denominators used to calculate basic EPS and
diluted EPS for the three and nine months ended
September 30, 2018 and 2017 are as follows:
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For the Three
Months Ended
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For the Nine
Months Ended
|
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September
30,
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September
30,
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2018
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2017
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2018
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2017
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Weighted average
common shares outstanding – basic
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3,306,069
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2,018,791
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3,058,442
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1,879,057
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Plus: Potentially
dilutive common shares:
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Warrants
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-
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11,987
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11,950
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-
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Weighted average
common shares outstanding – diluted
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3,306,069
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2,030,778
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3,070,392
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1,879,057
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For the
three months ended September 30, 2018 and the nine months ended
September 30, 2017, potential dilutive securities had an
anti-dilutive effect and were not included in the calculation of
diluted net loss per common share. Warrants excluded from the
calculation of diluted EPS because their effect was anti-dilutive
were 245,760 and 82,760 the three months ended September 30, 2018
and the nine months ended September 30, 2017,
respectively.
Stock-Based Compensation
Under
FASB ASC 718-10-30-2, all share-based payments to employees,
including grants of employee stock options, to be recognized in the
income statement based on their fair values. Pro forma disclosure
is no longer an alternative. The Company had no stock-based
compensation issuances during the nine months ended
September 30, 2018 and 2017.
Revenue Recognition
Sales on fixed price contracts are recorded when services are
earned, the earnings process is complete or substantially complete,
and the revenue is measurable and collectability is reasonably
assured. Provisions for discounts and rebates to customers,
estimated returns and allowances, and other adjustments are
provided for in the same period the related sales are recorded. The
Company defers any revenue from sales in which payment has been
received, but the earnings process has not occurred. Sales
commenced on July 5, 2017 with the termination of our joint venture
and are recognized upon shipment of goods, which are typically paid
for at the time of order.
Advertising and Promotion
All
costs associated with advertising and promoting products are
expensed as incurred. These expenses were $50,127 and $42,793 for
the nine months ended September 30, 2018 and 2017,
respectively.
Income Taxes
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. A valuation allowance is
provided for significant deferred tax assets when it is more likely
than not, that such asset will not be recovered through future
operations.
Uncertain Tax Positions
In
accordance with ASC 740, “Income Taxes” (“ASC
740”), the Company recognizes the tax benefit from an
uncertain tax position only if it is more likely than not that the
tax position will be capable of withstanding examination by the
taxing authorities based on the technical merits of the position.
These standards prescribe a recognition threshold and measurement
attribute for the financial statement recognition and measurement
of a tax position taken or expected to be taken in a tax return.
These standards also provide guidance on de-recognition,
classification, interest and penalties, accounting in interim
periods, disclosure, and transition.
Various
taxing authorities periodically audit the Company’s income
tax returns. These audits include questions regarding the
Company’s tax filing positions, including the timing and
amount of deductions and the allocation of income to various tax
jurisdictions. In evaluating the exposures connected with these
various tax filing positions, including state and local taxes, the
Company records allowances for probable exposures. A number of
years may elapse before a particular matter, for which an allowance
has been established, is audited and fully resolved. The Company
has not yet undergone an examination by any taxing
authorities.
The
assessment of the Company’s tax position relies on the
judgment of management to estimate the exposures associated with
the Company’s various filing positions.
8
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
Recent Accounting Pronouncements
In June
2018, the Financial Accounting Standards Board (“FASB”)
issued Accounting Standards Update (“ASU”) 2018-07,
Compensation-Stock Compensation
(Topic 718): Improvements to Nonemployee Share-Based Payment
Accounting, which expands the scope of Topic 718 to include
share-based payment transactions for acquiring goods and services
from nonemployees. An entity should apply the requirements of Topic
718 to nonemployee awards except for specific guidance on inputs to
an option pricing model and the attribution of cost (that is, the
period of time over which share-based payment awards vest and the
pattern of cost recognition over that period). The new guidance is
effective for all entities for annual periods, and interim periods
within those annual periods, beginning after December 15, 2017,
with early adoption permitted. The Company does not expect the
adoption of this ASU to have a material impact on its consolidated
financial statements.
In
March 2018, the FASB issued ASU No. 2018-05, Income Taxes (Topic 740) - Amendments to SEC
Paragraphs Pursuant to SEC Staff Accounting Bulletin No.
118. The amendment provides guidance on accounting for the
impact of the Tax Cuts and Jobs Act (the “Tax Act”) and
allows entities to complete the accounting under ASC 740 within a
one-year measurement period from the Tax Act enactment date. This
standard is effective upon issuance. The Tax Act has several
significant changes that impact all taxpayers, including a
transition tax, which is a one-time tax charge on accumulated,
undistributed foreign earnings. The calculation of accumulated
foreign earnings requires an analysis of each foreign
entity’s financial results going back to 1986. The Company
does not expect the adoption of this ASU to have a material impact
on its consolidated financial statements.
In February 2018, the FASB issued ASU No. 2018-02,
Reclassification
of Certain Tax Effects from Accumulated Other Comprehensive
Income. The guidance permits
entities to reclassify tax effects stranded in Accumulated Other
Comprehensive Income as a result of tax reform to retained
earnings. This new guidance is effective for annual and interim
periods in fiscal years beginning after December 15, 2018. Early
adoption is permitted in annual and interim periods and can be
applied retrospectively or in the period of adoption. The Company
is currently in the process of evaluating the impact of adoption on
its consolidated financial statements.
Effective
January 1, 2018, the Company adopted ASC 606 — Revenue from
Contracts with Customers. Under ASC 606, the Company recognizes
revenue from the commercial sales of products, licensing agreements
and contracts to perform pilot studies by applying the following
steps: (1) identify the contract with a customer; (2) identify the
performance obligations in the contract; (3) determine the
transaction price; (4) allocate the transaction price to each
performance obligation in the contract; and (5) recognize revenue
when each performance obligation is satisfied. For the comparative
periods, revenue has not been adjusted and continues to be reported
under ASC 605 — Revenue Recognition. Under ASC 605, revenue
is recognized when the following criteria are met: (1) persuasive
evidence of an arrangement exists; (2) the performance of service
has been rendered to a customer or delivery has occurred; (3) the
amount of fee to be paid by a customer is fixed and determinable;
and (4) the collectability of the fee is reasonably assured.
There was no impact on the
Company’s financial statements as a result of adopting Topic
606 for the nine months ended September 30, 2018 and 2017, or
the twelve months ended December 31, 2017.
In May
2017, the FASB issued ASU 2017-09, Compensation — Stock Compensation (Topic
718): Scope of Modification Accounting. ASU 2017-09, which
provides guidance about which changes to the terms or conditions of
a share-based payment award require an entity to apply modification
accounting in Topic 718. Per ASU
2017-9, an entity should account for the effects of a
modification unless all the following are met: (1) the fair value
(or calculated value or intrinsic value, if such an alternative
measurement method is used) of the modified award is the same as
the fair value (or calculated value or intrinsic value, if such an
alternative measurement method is used) of the original award
immediately before the original award is modified. If the
modification does not affect any of the inputs to the valuation
technique that the entity uses to value the award, the entity is
not required to estimate the value immediately before and after the
modification, (2) the vesting conditions of the modified award are
the same as the vesting conditions of the original award
immediately before the original award is modified, and (3) the
classification of the modified award as an equity instrument or a
liability instrument is the same as the classification of the
original award immediately before the original award is modified.
The current disclosure requirements in Topic 718 apply regardless
of whether an entity is required to apply modification accounting
under the amendments in ASU 2017-9. ASU 2017-9 is effective for public business
entities for annual and interim periods in fiscal years beginning
after December 15, 2017. Early adoption is permitted,
including adoption in any interim period, for (1) public business
entities for reporting periods for which financial statements have
not yet been issued and (2) all other entities for reporting
periods for which financial statements have not yet been made
available for issuance. The amendments in this ASU should be
applied prospectively to an award modified on or after the adoption
date. The adoption of ASU
2017-9 is not expected to have a material impact on the
Company’s financial statements or related
disclosures.
No
other new accounting pronouncements, issued or effective during the
nine months ended September 30, 2018, have had or are expected
to have a significant impact on the Company’s financial
statements.
9
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
Note 2 – Going Concern
As
shown in the accompanying financial statements, the Company has
minimal revenues, incurred net losses from operations resulting in
an accumulated deficit of $16,226,029, and had negative working
capital of ($2,249,510) at September 30, 2018. These factors
raise substantial doubt about the Company’s ability to
continue as a going concern. The Company is currently seeking
additional sources of capital to fund short term operations. The
Company, however, is dependent upon its ability to secure equity
and/or debt financing and there are no assurances that the Company
will be successful; therefore, without sufficient financing it
would be unlikely for the Company to continue as a going
concern.
The
financial statements do not include any adjustments that might
result from the outcome of any uncertainty as to the
Company’s ability to continue as a going concern. The
financial statements also do not include any adjustments relating
to the recoverability and classification of recorded asset amounts,
or amounts and classifications of liabilities that might be
necessary should the Company be unable to continue as a going
concern.
Note 3 – Related Parties
Accounts Payable
The
Company owed $29,116 and $40,195 as of September 30, 2018
and December 31, 2017, respectively, to entities owned by the
Chairman of the Board of Directors. The amounts are related to
patent costs and reimbursable expenses paid by the Chairman on
behalf of the Company.
The
Company owed $748 as of September 30, 2018 and December
31, 2017, to the Company’s CEO for reimbursable
expenses.
The
Company owed $1,075 and $478 as of September 30, 2018 and
December 31, 2017, respectively, amongst members of the
Company’s Board of Directors for reimbursable
expenses.
Note 4 – Subsidiary Formation
On
September 14, 2017, we formed Premier Biomedical Pain Relief Meds,
LLC as a wholly-owned Nevada limited liability company. On January
1, 2018, we contributed our pain management assets to this entity
and continued our pain management operations within this new
subsidiary.
Note 5 – Patent Rights and Applications
The
Company amortizes its patent rights and applications on a straight
line basis over the expected useful technological or economic life
of the patents, which is typically 17 years from the legal approval
of the patent applications when there is probable future economic
benefits associated with the patent. The Company has elected to
expense all of their patent rights and application costs due to
difficulties associated with having to prove the value of their
future economic benefits. All patent applications are currently
pending and the Company has no patents that have yet been approved.
It is the Company’s policy that it performs reviews of the
carrying value of its patent rights and applications on an annual
basis.
On
March 4, 2015, we entered into a Patent License Agreement
(“PLA”) with the University of Texas at El Paso
(“UTEP”) regarding our joint research and development
of CTLA-4 Blockade with Metronomic Chemotherapy for the Treatment
of Breast Cancer. This is the first PLA with UTEP following our
Collaborative Agreement with them dated May 9, 2012, and
memorializes the joint ownership of the applicable patent and the
financial and other terms related thereto.
On June
19, 2015, we entered into Amendment No. 1 to this Agreement,
pursuant to which we explicitly included Provisional Patent
Application No. 62/161,116 entitled, “Anti-CTLA-4
Blockade” (the “Application”) under the
definition of “Patent Rights” as set forth in the PLA.
The Application was filed with the United States Patent and
Trademarks Office on May 13, 2015; the underlying technology was
invented by Robert Kirken and Georgialina Rodriguez, and is
solely-owned by The Board of Regents of The University of Texas
System.
Note 6 – Fair Value of Financial Instruments
Under
FASB ASC 820-10-5, fair value is defined as the price that would be
received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement
date (an exit price). The standard outlines a valuation framework
and creates a fair value hierarchy in order to increase the
consistency and comparability of fair value measurements and the
related disclosures. Under GAAP, certain assets and liabilities
must be measured at fair value, and FASB ASC 820-10-50 details the
disclosures that are required for items measured at fair
value.
10
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
The
Company has certain financial instruments that must be measured
under the new fair value standard. The Company’s financial
assets and liabilities are measured using inputs from the three
levels of the fair value hierarchy. The three levels are as
follows:
Level 1
- Inputs are unadjusted quoted prices in active markets for
identical assets or liabilities that the Company has the ability to
access at the measurement date.
Level 2
- Inputs include quoted prices for similar assets and liabilities
in active markets, quoted prices for identical or similar assets or
liabilities in markets that are not active, inputs other than
quoted prices that are observable for the asset or liability (e.g.,
interest rates, yield curves, etc.), and inputs that are derived
principally from or corroborated by observable market data by
correlation or other means (market corroborated
inputs).
Level 3
- Unobservable inputs that reflect our assumptions about the
assumptions that market participants would use in pricing the asset
or liability.
The
following schedule summarizes the valuation of financial
instruments at fair value on a recurring basis in the balance
sheets as of September 30, 2018 and December 31, 2017,
respectively:
|
Fair Value
Measurements at September 30, 2018
|
||
|
Level
1
|
Level
2
|
Level
3
|
Assets
|
|
|
|
Cash
|
$63,204
|
$-
|
$-
|
Total
assets
|
63,204
|
-
|
-
|
Liabilities
|
|
|
|
Convertible notes
payable, net of discounts
|
|
304,269
|
|
Derivative
liabilities
|
-
|
-
|
1,807,945
|
Total
liabilities
|
-
|
304,269
|
1,807,945
|
|
$63,204
|
$(304,269)
|
$(1,807,945
|
|
Fair Value
Measurements at December 31, 2017
|
||
|
Level
1
|
Level
2
|
Level
3
|
Assets
|
|
|
|
Cash
|
$83,704
|
$-
|
$-
|
Total
assets
|
83,704
|
-
|
-
|
Liabilities
|
|
|
|
Convertible note
payable, net of discounts
|
-
|
169,990
|
-
|
Derivative
liabilities
|
-
|
-
|
2,255,781
|
Total
liabilities
|
-
|
169,990
|
2,255,781
|
|
$83,704
|
$(169,990)
|
$(2,255,781)
|
The
fair values of our related party debts are deemed to approximate
book value, and are considered Level 2 inputs as defined by
ASC Topic 820-10-35.
There
were no transfers of financial assets or liabilities between Level
1, Level 2 and Level 3 inputs for the nine months ended
September 30, 2018 or the year ended December 31,
2017.
11
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
Note 7 – Convertible Notes Payable, Currently in
Default
Convertible
notes payable consists of the following at September 30, 2018
and December 31, 2017, respectively:
|
September 30,
|
December
31,
|
|
2018
|
2017
|
|
|
|
On July 11, 2018, the
Company received proceeds of $120,000 in exchange for an 8%
interest bearing; unsecured convertible promissory note maturing on
October31, 2018 (“Third Red Diamond Note”). The note is
convertible at 60% of the lowest traded price of the Common Stock
in the fifteen (15) Trading Days prior to the Conversion Date. A
total of $25,920 of principal was converted into 348,667 shares of
common stock over various dates between July27,2018 and
August23,2018.$
|
94,080
|
$-
|
|
|
|
On July 11, 2018,
the Company received proceeds of $60,000 in exchange for an 8%
interest bearing; unsecured convertible promissory note maturing on
October 31, 2018 (“Third SEG-RedaShex Note”). The
note is convertible at 60% of the lowest traded price of the Common
Stock in the fifteen (15) Trading Days prior to the Conversion
Date.
|
60,000
|
-
|
|
|
|
On April 24, 2018,
the Company received proceeds of $30,000 in exchange for an 8%
interest bearing; unsecured convertible promissory note maturing on
July 31, 2018 (“Second Red Diamond Note”). The
note is convertible at 60% of the lowest traded price of the Common
Stock in the fifteen (15) Trading Days prior to the Conversion
Date.
|
30,000
|
-
|
|
|
|
On April 24, 2018,
the Company received proceeds of $30,000 in exchange for an 8%
interest bearing; unsecured convertible promissory note maturing on
July 31, 2018 (“Second SEG-RedaShex Note”). The
note is convertible at 60% of the lowest traded price of the Common
Stock in the fifteen (15) Trading Days prior to the Conversion
Date.
|
30,000
|
-
|
|
|
|
On March 1, 2018,
the Company received proceeds of $30,000 in exchange for an 8%
interest bearing; unsecured convertible promissory note maturing on
May 31, 2018 (“First Red Diamond Note”). The note
is convertible at 60% of the lowest traded price of the Common
Stock in the fifteen (15) Trading Days prior to the Conversion
Date.
|
30,000
|
-
|
|
|
|
On March 1, 2018,
the Company received proceeds of $30,000 in exchange for an 8%
interest bearing; unsecured convertible promissory note maturing on
May 31, 2018 (“First SEG-RedaShex Note”). The note
is convertible at 60% of the lowest traded price of the Common
Stock in the fifteen (15) Trading Days prior to the Conversion
Date. A total of $22,500 of principal was converted into 275,875
shares of common stock over various dates between
September 5, 2018 and
September 18, 2018.
|
7,500
|
-
|
12
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
On October 30,
2017, the Company received proceeds of $50,000 in exchange for an
8% interest bearing; unsecured convertible promissory note maturing
on January 31, 2018 (“Second Diamond Rock Note”).
The note is convertible at 60% of the lowest traded price of the
Common Stock in the fifteen (15) Trading Days prior to the
Conversion Date.
|
50,000
|
50,000
|
|
|
|
On October 30,
2017, the Company received proceeds of $50,000 in exchange for an
8% interest bearing; unsecured convertible promissory note maturing
on January 31, 2018 (“Second SEG Note”). The note
is convertible at 60% of the lowest traded price of the Common
Stock in the fifteen (15) Trading Days prior to the Conversion
Date. A total of $10,000 of principal was converted into 5,208,333
shares of common stock on October 31, 2017, and the
remaining $40,000 of principal was converted into 26,559,426 shares
of common stock on January 29, 2018.
|
-
|
40,000
|
|
|
|
On August 8, 2017,
the Company entered into an exchange agreement with Diamond Rock,
LLC whereby they exchanged (i) the 13,333,334 Series A Warrants
purchased in the First Closing, (ii) the 13,333,334 Series B
Warrants purchased in the First Closing, and (iii) the 10,101,011
shares of common stock purchased in the Second Closing (the
“Exchange Securities”) for a $50,000 convertible note
(“First Diamond Rock Note”) issued by the Company,
bearing interest at 8% interest and maturing on November 30, 2017.
The notes are convertible at 50% of the lowest traded price of the
Common Stock in the fifteen (15) Trading Days prior to the
Conversion Date. A total of $15,000 of principal was converted into
an aggregate of 7,812,500 shares of common stock at various dates
between November 6, 2017 and
November 13, 2017.
|
35,000
|
35,000
|
|
|
|
On August 8, 2017,
the Company entered into an exchange agreement with The Special
Equities Group, LLC whereby they exchanged (i) the 13,333,334
Series A Warrants purchased in the First Closing, (ii) the
13,333,334 Series B Warrants purchased in the First Closing, and
(iii) the 10,101,011 shares of common stock purchased in the Second
Closing (the “Exchange Securities”) for a $50,000
convertible note (“First SEG Note”) issued by the
Company, bearing interest at 8% interest and maturing on November
30, 2017. The notes are convertible at 50% of the lowest traded
price of the Common Stock in the fifteen (15) Trading Days prior to
the Conversion Date. A total of $22,100 of principal was converted
into 332,176 shares of common stock over various dates between
August 20, 2018 and
September 24, 2018.
|
27,900
|
50,000
|
|
|
|
On August 8, 2017,
the Company entered into an exchange agreement with RDW Capital,
LLC whereby they exchanged (i) the 13,333,334 Series A Warrants
purchased in the First Closing, (ii) the 13,333,334 Series B
Warrants purchased in the First Closing, and (iii) the 10,101,011
shares of common stock purchased in the Second Closing (the
“Exchange Securities”) for a $50,000 convertible note
(“First RDW Note”) issued by the Company, bearing
interest at 8% interest and maturing on November 30, 2017. The
notes are convertible at 50% of the lowest traded price of the
Common Stock in the fifteen (15) Trading Days prior to the
Conversion Date. A total of $25,000 of principal was converted into
13,157,895 shares of common stock on October 31, 2017,
and the remaining $25,000 of principal was converted into
19,230,769 shares of common stock on
January 3, 2018.
|
-
|
25,000
|
|
|
|
Total convertible
notes payable, currently in default
|
364,480
|
200,000
|
Less unamortized
derivative discounts:
|
60,211
|
30,010
|
Convertible notes
payable
|
304,269
|
169,990
|
Less: current
portion
|
304,269
|
169,990
|
Convertible notes
payable, less current portion
|
-
|
-
|
The
Company recognized interest expense for the nine months ended
September 30, 2018 and 2017, respectively, as
follows:
|
September 30,
|
September 30,
|
|
2018
|
2017
|
|
|
|
Interest on
convertible notes
|
$15,881
|
$4,434
|
Interest on related
party loans
|
-
|
1,800
|
Derivative
discounts
|
306,442
|
184,237
|
Total interest
expense
|
$322,323
|
$190,471
|
13
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
Note 8 – Derivative Liabilities
As discussed in Note 7 under Convertible Notes Payable, the Company
issued debts that consist of the issuance of convertible notes with
variable conversion provisions. The conversion terms of the
convertible notes are variable based on certain factors, such as
the future price of the Company’s common stock. The number of
shares of common stock to be issued is based on the future price of
the Company’s common stock. The number of shares of common
stock issuable upon conversion of the promissory note is
indeterminate. Due to the fact that the number of shares of common
stock issuable could exceed the Company’s authorized share
limit, the equity environment is tainted and all additional
convertible debentures and warrants are included in the value of
the derivative. Pursuant to ASC 815-15 Embedded Derivatives, the
fair values of the variable conversion option and warrants and
shares to be issued were recorded as derivative liabilities on the
issuance date.
The fair values of the Company’s derivative liabilities were
estimated at the issuance date and are revalued at each subsequent
reporting date, using a lattice model. The Company recognized
current derivative liabilities of $1,807,945 and $2,255,781
at September 30, 2018 and December 31, 2017,
respectively. The change in fair value of the derivative
liabilities resulted in a gain of $655,808 and a loss of $2,267,885
for the nine months ended September 30, 2018
and 2017, respectively, which has been reported within other
expense in the statements of operations. The gain of $655,808 for
the nine months ended September 30, 2018 consisted of a
gain of $743,751 due to the value attributable to the warrants and
a net loss in market value of $87,943 on the convertible notes. The
loss of $2,267,885 for the nine months ended
September 30, 2017 consisted of a loss of $3,337,007 due
to the value attributable to the warrants, a gain of $1,052,505 in
market value of the warrants and a net gain in market value of
$16,617 on the convertible notes.
The
following is a summary of changes in the fair market value of the
derivative liability during the nine
months ended September 30, 2018 and the year ended
December 31, 2017, respectively:
|
Derivative
|
|
Liability
|
|
Total
|
Balance, December
31, 2016
|
$221,822
|
Increase
in derivative value due to issuances of convertible promissory
notes
|
221,515
|
Increase
in derivative value attributable to tainted warrants
|
7,103,444
|
Decrease
in derivative value attributable to exchange of
warrants
|
(3,766,437)
|
Change
in fair market value of derivative liabilities due to the mark to
market adjustment
|
(1,221,021)
|
Debt
conversions
|
(303,542)
|
Balance, December
31, 2017
|
$2,255,781
|
Increase
in derivative value due to issuances of convertible promissory
notes
|
336,643
|
Change
in fair market value of derivative liabilities due to the mark to
market adjustment
|
(655,808)
|
Debt
conversions
|
(128,671)
|
Balance,
September 30, 2018
|
$1,807,945
|
Key inputs and assumptions used to value the convertible debentures
and warrants issued during the nine months ended
September 30, 2018:
●
Stock price
ranging from $0.177 to $0.52 during these periods would fluctuate
with projected volatility.
●
The
notes convert with variable conversion prices and fixed conversion
prices (tainted notes).
●
An
event of default would occur -0-% of the time, increasing 2% per
month to a maximum of 10%.
●
The
projected annual volatility curve for each valuation period was
based on the historical annual volatility of the company in the
range of 151.7% - 258.1%.
●
The
Company would redeem the notes -0-% of the time, increasing 1% per
month to a maximum of 5%.
●
All
notes are assumed to be extended at maturity by 2 years – the
time required to convert out this volume of stock.
●
The
holders of the securities would automatically convert midway
through to maturity on a monthly basis based on ownership and
trading volume limitations.
●
A
change of control and fundamental transaction would occur initially
-0-% of the time and increase monthly by -0-% to a maximum of
-0-%.
●
The
monthly trading volume would average $967,424 to $868,383 and would
increase at 1% per month.
●
The stock price
would fluctuate with the Company projected volatility using a
random sampling (500,000 iterations for each valuation) from a
normal distribution. The stock price of the underlying instrument
is modelled such that it follows a geometric Brownian motion with
constant drift and volatility.
●
The Holder would
exercise the warrants after one trading day as they become
exercisable (at issuance) at target prices of 3 to 5 times the
projected reset price or higher.
●
Reset events were
projected to occur by 12/31/18 – the reset provision ends
3/30/19 and the option expires 3/30/20.
●
The stock price
would fluctuate with an annual volatility. The projected annual
volatility curve for each valuation period was based on the
historical annual volatility of the company and the term remaining
in the range 176.6% - 176.6%.
●
The Holder would
exercise the warrant at maturity in 2020 if the stock price was
above the reset exercise price.
14
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
Note 9 – Commitments and Contingencies
Collaborative Patent License Agreements
On May
9, 2012, the Company entered into a Collaborative Agreement with
the University of Texas at El Paso. Pursuant to the terms of the
Agreement, the Company will work jointly with the University to
develop a series of research and development programs around its
sequential-dialysis technology in the areas of Alzheimer's Disease,
Traumatic Brain Injury (TBI), Chronic Pain Syndrome, Fibromyalgia,
Multiple Sclerosis, Amyotrophic Lateral Sclerosis (ALS or Lou
Gehrig's disease), Blood Sepsis, Cancer, Heart Attacks and Strokes.
The programs will utilize the facilities at one or more of the
University of Texas’ campuses. The Company will pay the
University’s actual overhead for the projects, plus a
negotiated facility and administration overhead expense, and 10% of
all gross revenues associated with the sale, license and/or
royalties of all products and treatment procedures directly
affiliated with programs. Intellectual property jointly invented
and developed as a result of the projects will be owned jointly by
the University and the Company. The Agreement has an initial term
of five (5) years, and is renewable upon mutual agreement of the
parties.
On
March 4, 2015, we entered into a Patent License Agreement (PLA)
with the University of Texas at El Paso (UTEP) regarding our joint
research and development of CTLA-4 Blockade with Metronomic
Chemotherapy for the Treatment of Breast Cancer. This is the first
PLA with UTEP following our Collaborative Agreement with them dated
May 9, 2012, and memorializes the joint ownership of the
applicable patent and the financial and other terms related
thereto.
On June
19, 2015, we entered into Amendment No. 1 to this Agreement,
pursuant to which we explicitly included Provisional Patent
Application No. 62/161,116 entitled, “Anti-CTLA-4
Blockade” (the “Application”) under the
definition of “Patent Rights” as set forth in the PLA.
The Application was filed with the United States Patent and
Trademarks Office on May 13, 2015; the underlying
technology was invented by Robert Kirken and Georgialina Rodriguez,
and is solely-owned by The Board of Regents of The University of
Texas System.
On
October 31, 2017 we entered into an Agreement, Final Payment under
Contract, and Release of all Claims, whereby we agreed to pay them
a total of $326,336 arising out of the research and development
agreements with an initial payment of $22,211, and monthly payments
of varying amounts between $5,000 and $20,000 thereafter for twenty
eight months until the balance is paid in full. Subject to the
compliance of all terms, the intellectual property rights
established and arising out of the collaborative agreements remain
in full force and effect and the parties agreed to a mutual release
upon the final contracted payment. The full amount of the liability
has been recognized as accounts payable, with $262,524 outstanding
as of the date of this filing.
Note 10 – Changes in Stockholders’ Equity
(Deficit)
Reverse Stock Split
On June 27, 2018, the Company effected a 1-for-250 reverse
stock split (the “Reverse Stock Split”). No fractional shares were issued, and no
cash or other consideration was paid in connection with the Reverse
Stock Split. Instead, the Company issued one whole share of the
post-Reverse Stock Split common stock to any stockholder who
otherwise would have received a fractional share as a result of the
Reverse Stock Split. The Company was authorized to issue
1,000,000,000 shares of common stock prior to the Reverse Stock
Split, which remains unaffected. The Reverse Stock Split did not
have any effect on the stated par value of the common stock, or the
Company’s authorized preferred stock. Unless otherwise
stated, all share and per share information in this Quarterly
Report on Form 10-Q has been retroactively adjusted to reflect the
Reverse Stock Split.
Convertible Preferred Stock, Series A
The
Company has 10,000,000 authorized shares of Preferred Stock, of
which 2,000,000 shares of $0.001 par value Series A Convertible
Preferred Stock (“Series A Preferred Stock”) have been
designated. Each share of Series A Preferred Stock is convertible,
at the option of the holder thereof, at any time after the issuance
of such share into one (1) fully paid and non-assessable share of
Common Stock. Each outstanding share of Series A Preferred Stock is
entitled to one hundred (100) votes per share on all matters to
which the shareholders of the Corporation are entitled or required
to vote. The Company shall reserve and keep available out of its
authorized but unissued shares of Common Stock such number of
shares sufficient to effect the conversions.
15
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
Common Stock
The
Company has one billion authorized shares of $0.00001 par value
Common Stock, as increased pursuant to an amendment to the articles
of incorporation on February 9, 2016.
Common Stock Issuances for Debt Conversions
On
September 24, 2018, the Company granted 172,176 shares of common
stock pursuant to the conversion of $12,500 of principal from the
First SEG Note. The shares were subsequently issued on October 2,
2018. As such, the $12,500 was presented as a subscription payable
at September 30, 2018. The note was converted in accordance
with the conversion terms; therefore, no gain or loss has been
recognized.
On
September 18, 2018, the Company issued 136,986 shares of common
stock pursuant to the conversion of $10,000 of principal from the
First Red Diamond Note. The note was converted in accordance with
the conversion terms; therefore, no gain or loss has been
recognized.
On
September 5, 2018, the Company issued 138,889 shares of common
stock pursuant to the conversion of $12,500 of principal from the
First Red Diamond Note. The note was converted in accordance with
the conversion terms; therefore, no gain or loss has been
recognized.
On
August 23, 2018, the Company issued 82,001 shares of common stock
pursuant to the conversion of $4,920 of principal from the Third
Red Diamond Note. The note was converted in accordance with the
conversion terms; therefore, no gain or loss has been
recognized.
On
August 20, 2018, the Company issued 160,000 shares of common stock
pursuant to the conversion of $9,600 of principal from the First
SEG Note. The note was converted in accordance with the conversion
terms; therefore, no gain or loss has been recognized.
On
August 15, 2018, the Company issued 100,000 shares of common stock
pursuant to the conversion of $6,000 of principal from the Third
Red Diamond Note. The note was converted in accordance with the
conversion terms; therefore, no gain or loss has been
recognized.
On
August 9, 2018, the Company issued 83,333 shares of common stock
pursuant to the conversion of $5,000 of principal from the Third
Red Diamond Note. The note was converted in accordance with the
conversion terms; therefore, no gain or loss has been
recognized.
On July
27, 2018, the Company issued 83,333 shares of common stock pursuant
to the conversion of $10,000 of principal from the Third Red
Diamond Note. The note was converted in accordance with the
conversion terms; therefore, no gain or loss has been
recognized.
On
January 29, 2018, the Company issued 106,238 shares of common stock
pursuant to the conversion of $40,000 of principal from the Second
SEG Note. The note was converted in accordance with the conversion
terms; therefore, no gain or loss has been recognized.
On
January 3, 2018, the Company issued 76,923 shares of common stock
pursuant to the conversion of $25,000 of principal from the First
RDW Note. The note was converted in accordance with the conversion
terms; therefore, no gain or loss has been recognized.
Common Stock Issuances on Subscriptions Payable
On
various dates from January 17, 2018 through February 13, 2018, the
Company issued a total of 254,703 shares to The Special Equities Group and DiamondRock, LLC
as compensation valued at $273,805 awarded on
December 6, 2017.
Note 11 – Income Taxes
The
Company accounts for income taxes under FASB ASC 740-10, which
requires use of the liability method. FASB ASC 740-10-25 provides
that deferred tax assets and liabilities are recorded based on the
differences between the tax bases of assets and liabilities and
their carrying amounts for financial reporting purposes, referred
to as temporary differences.
For the
nine months ended September 30, 2018, and the year ended
December 31, 2017, the Company incurred a net operating loss and,
accordingly, no provision for income taxes has been recorded. In
addition, no benefit for income taxes has been recorded due to the
uncertainty of the realization of any tax assets. At
September 30, 2018, and December 31, 2017, the
Company had approximately $5,105,000 and $4,860,000 of federal net
operating losses, respectively. The net operating loss carry
forwards, if not utilized, will begin to expire in
2031.
The
components of the Company’s deferred tax asset are as
follows:
|
September 30,
|
December
31,
|
|
2018
|
2017
|
Deferred tax
assets:
|
|
|
Net operating loss
carry forwards
|
$1,072,000
|
$1,701,000
|
|
|
|
Net deferred tax
assets before valuation allowance
|
$1,072,000
|
$1,701,000
|
Less: Valuation
allowance
|
(1,072,000)
|
$(1,701,000)
|
Net deferred tax
assets
|
$-
|
$-
|
16
Premier Biomedical, Inc.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
Based
on the available objective evidence, including the Company’s
history of losses, management believes it is more likely than not
that the net deferred tax assets will not be fully realizable.
Accordingly, the Company provided for a full valuation allowance
against its net deferred tax assets at
September 30, 2018, and December 31, 2017,
respectively.
A
reconciliation between the amounts of income tax benefit determined
by applying the applicable U.S. and state statutory income tax rate
to pre-tax loss is as follows:
|
September 30,
|
December
31,
|
|
2018
|
2017
|
|
|
|
Federal and state
statutory rate
|
21%
|
35%
|
Change in valuation
allowance on deferred tax assets
|
(21%)
|
(35%)
|
In
accordance with FASB ASC 740, the Company has evaluated its tax
positions and determined there are no uncertain tax
positions.
Note 12 – Subsequent Events
Common Stock Issuances for Debt Conversions
On
November 12, 2018, the Company issued 150,000 shares of common
stock pursuant to the conversion of $13,500 of principal from the
First SEG Note. The note was converted in accordance with the
conversion terms; therefore, no gain or loss has been
recognized.
On
November 5, 2018, the Company issued 190,000 shares of common stock
pursuant to the conversion of $8,075 of principal from the First
Red Diamond Note. The note was converted in accordance with the
conversion terms; therefore, no gain or loss has been
recognized.
On
October 25, 2018, the Company issued 175,000 shares of common stock
pursuant to the conversion of $8,750 of principal from the First
Red Diamond Note. The note was converted in accordance with the
conversion terms; therefore, no gain or loss has been
recognized.
On
October 16, 2018, the Company issued 202,702 shares of common stock
pursuant to the conversion of $13,500 of principal from the First
SEG Note. The note was converted in accordance with the conversion
terms; therefore, no gain or loss has been recognized.
On
October 12, 2018, the Company issued 175,000 shares of common stock
pursuant to the conversion of $9,712 of principal from the First
Red Diamond Note. The note was converted in accordance with the
conversion terms; therefore, no gain or loss has been
recognized.
On
October 3, 2018, the Company issued 111,940 shares of common stock
pursuant to the conversion of $7,500 of principal from the First
Red Diamond Note. The note was converted in accordance with the
conversion terms; therefore, no gain or loss has been
recognized.
17
ITEM
2
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
Our
Management’s Discussion and Analysis contains not only
statements that are historical facts, but also statements that are
forward-looking (within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934). Forward-looking statements are, by their very nature,
uncertain and risky. These risks and uncertainties include
international, national and local general economic and market
conditions; demographic changes; our ability to sustain, manage, or
forecast growth; our ability to successfully make and integrate
acquisitions; raw material costs and availability; new product
development and introduction; existing government regulations and
changes in, or the failure to comply with, government regulations;
adverse publicity; competition; the loss of significant customers
or suppliers; fluctuations and difficulty in forecasting operating
results; changes in business strategy or development plans;
business disruptions; the ability to attract and retain qualified
personnel; the ability to protect technology; and other risks that
might be detailed from time to time in our filings with the
Securities and Exchange Commission.
Although the
forward-looking statements in this Quarterly Statement reflect the
good faith judgment of our management, such statements can only be
based on facts and factors currently known by them. Consequently,
and because forward-looking statements are inherently subject to
risks and uncertainties, the actual results and outcomes may differ
materially from the results and outcomes discussed in the
forward-looking statements. You are urged to carefully review and
consider the various disclosures made by us in this report and in
our other reports as we attempt to advise interested parties of the
risks and factors that may affect our business, financial
condition, and results of operations and prospects.
The following
discussion and analysis of financial condition and results of
operations of the Company is based upon, and should be read in
conjunction with, its unaudited financial statements and related
notes elsewhere in this Form 10-Q, which have been prepared in
accordance with accounting principles generally accepted in the
United States.
Summary
Overview
We were strictly a
research-based company that intended to discover cures for PTSD,
cancer and various other diseases. In order to fund on-going
research and development in our Biologics Division, we developed a
line of hemp oil based topical pain relief products. We began in
January of 2017 with a single product and currently have eight
topical pain relief products.
Through our
continued development and expansion of proprietary drugs and
treatments, we have reorganized the company into six technology
centers: (1) extra-corporeal treatment of disease, (2) PTSD
treatment, (3) anti-breast cancer drugs, (4) hemp oil/CBD pain
relief products, (5) anti-aging treatments, and (6) chemical and
alcohol addiction treatment.
Pain Management Products
We have developed
and are now marketing all-natural, hemp-oil based products that are
pesticide and solvent free. These products provide generalized,
neuropathic and localized topical pain relief.
We offer
alternatives to dangerous and addictive opioid pain killers, which
are currently the principal contributors to roughly 200 drug
overdose deaths per day in the United States. In the past year we
have rapidly expanded our product offerings, and we now offer eight
pain relief products that are leaders in the pain-relief
field:
1.
96-hour pain relief
patch with 50 mg of hemp oil extract, the highest level of pain
relief ingredient available in the industry;
2.
120 mg/ 10 ml
water-based roll-on applicator;
18
3.
150 mg/ 10 ml
oil-based roll-on applicator;
4.
150 mg/ 30 ml
oil-based pump spray applicator;
5.
150 mg/ 2 oz.
ointment;
6.
200 mg/10 ml
oil-based roll-on applicator;
7.
500 mg/ 30 ml
oil-based pump spray applicator; and
8.
500 mg/ 1 oz.
ointment.
We believe that
this eight-product array positions us favorably in the topical pain
relief marketplace. The topical pain relief market is expected to
grow rapidly in the next few years, due to the focus on reduction
of opioid pain medication use, and we intend to be a major player
in that expanding market.
Now that we have
completed the product design and development phase, we are
aggressively embarking on the product distribution and sales phase
by:
1.
Expanding our
online sales beyond our web site at: www.painreliefmeds.com;
2.
Securing the
services of a social media coordinator to ensure that we optimize
that promotional tool;
3.
Recruiting a
National Sales Director to coordinate our growing field of sales
representatives and distributors;
4.
Securing the
services of a sales organization with expertise in marketing to the
government and senior care facilities;
5.
Engaging an
investor relations firm to facilitate television appearances
designed to gain optimum exposure for our company and its
products;
6.
Appearing in radio
and television broadcasts, and podcasts, via Uptick Newswire
periodically to ensure that our story gets out to the public;
and
7.
Retaining the
services of marketing firms to promote the Company and its products
through social media.
8.
Establishing
relationships with major distributors who will blanket specialized
sales outlets such as pharmacies, doctors’ offices,
convenience stores, long-term care facilities, large retail
facilities, etc.
In addition, we are
in the process of seeking potential partnerships outside the United
States to manufacture and market our products worldwide. We
anticipate that these partnerships will make new markets available
to us and allow us to rapidly increase our sales and profitability
through favorable manufacturing arrangements.
Customers indicate
that they were able to achieve pain relief from our products and
stop the use of opioid painkillers. Public awareness of the harmful
side effects of opioid painkillers has grown significantly, and
many states have initiated litigation against drug makers claiming
they misrepresented the risks of opioid painkillers.1
1 See Oklahoma Sues Opioid Drugmakers;
New Hampshire Presses Epidemic Probe, by Heide Brandes and Nate
Raymond, Reuters, available at
https://www.reuters.com/article/us-oklahoma-drugs-idUSKBN19L2HJ.
19
As patients seek to
cut back their use of opioid painkillers and look for alternatives,
we believe demand for our products will see a significant increase.
We intend to petition national insurance agencies to urge them to
consider covering the use of our all-natural pain relief products
as a safe alternative to opioid painkillers.
Financing
In the past, as we
worked through the development of our products, we have relied
heavily on financing through various issuances of common stock,
warrants and convertible debt. As our sales grow, we expect to find
financing solutions in the future that help us expand our
operations, avoid dilution to our shareholders, and ultimately
increase our company valuation.
On March 1, 2018,
we received $60,000 from the sale of convertible notes to two
investors. On April 24, 2018, the investors bought additional
convertible notes for an aggregate of $60,000 when we filed a
registration statement to cover the shares of common stock issuable
upon conversion of their convertible notes. On July 11, 2018, these
investors provided us with an additional $180,000 for convertible
notes in the third and final tranche of their commitment to
us.
Despite the recent
sales of convertible notes, our goal is to move forward with more
favorable financing as we begin to grow our revenues. To date, the
cash generated by these new products is not yet sufficient to
finance our volume ramp-up and planned product
introductions.
Through the
remainder of 2018 and into 2019, we will continue to market our
pain management products and seek a wider distribution network
through the negotiation of distribution agreements with large
pharmacy chains, military branches, government agencies, senior
care facilities and international partners.
Through our
reorganization into four technology centers, we are positioned to
take advantage of opportunities to individually sell, license or
commercialize the technologies produced within each of these
centers to suitable investment partners, without dilutive equity
issuances. In the long run, we believe that this will be most
beneficial to our investors.
Going Concern
As a result of our
current financial condition, we have received a report from our
independent registered public accounting firm for our financial
statements for the years ended December 31, 2017 and 2016 that
includes an explanatory paragraph describing the uncertainty as to
our ability to continue as a going concern. In order to continue as
a going concern we must effectively balance many factors and
generate more revenue so that we can fund our operations from our
sales and revenues. If we are not able to do this we may not be
able to continue as an operating company. We recently completed the
sale of convertible notes to raise $180,000. This should give us
the capital we need in the short term to push forward in the
production and marketing of our new pain management products.
However, if we are unable to grow revenues sufficient to meet our
operating expenses, we must again raise capital by issuing debt or
through the sale of our stock. There is no assurance that our cash
flow will be adequate to satisfy our operating expenses and capital
requirements.
Results
of Operations for the Three and Nine Months Ended September 30,
2018 and 2017
Introduction
We had revenues
from our pain management products of $8,225 and $24,276 for the
three months ended September 30, 2018 and 2017, respectively. Our
cost of goods sold were $4,373 and $11,070 for the three months
ended September 30, 2018 and 2017, respectively. We had revenues of
$30,709 and $24,276 for the nine months ended September 30, 2018
and 2017. Our cost of goods sold were $20,577 and $11,070 for the
nine months ended September 30, 2018 and 2017, respectively. Our
operating expenses were $85,185 and $240,834, respectively, for the
three and nine months ended September 30, 2018, compared to
$243,563 and $403,624, respectively, for the three and nine months
ended September 30, 2017, a decrease of $158,378 and $162,790, or
66% and 27%, respectively.
20
Our results of
operations for the three and nine months ended September 30, 2018
and 2017 were as follows:
|
Three
Months
|
Three
Months
|
Nine
Months
|
Nine
Months
|
|
September
30,
|
September
30,
|
September
30,
|
September
30,
|
|
2018
|
2017
|
2018
|
2017
|
|
|
|
|
|
Revenue
|
$8,225
|
$24,276
|
$30,709
|
$24,276
|
Cost of goods
sold
|
4,373
|
11,070
|
20,577
|
11,070
|
Gross
profit
|
3,852
|
13,206
|
10,132
|
13,206
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
Research and
Development
|
-
|
184,315
|
-
|
184,315
|
General and
administrative
|
62,572
|
36,979
|
139,881
|
110,284
|
Professional
fees
|
22,613
|
22,269
|
100,953
|
109,025
|
Total operating
expenses
|
85,185
|
243,563
|
240,834
|
403,624
|
|
|
|
|
|
Net operating
loss
|
(81,333)
|
(230,357)
|
(230,702)
|
(390,418)
|
Other income
(expense)
|
(282,202)
|
3,951,918
|
333,485
|
(2,464,588)
|
|
|
|
|
|
Net income
(loss)
|
$(363,535)
|
$3,721,561
|
$102,783
|
$(2,855,006)
|
Revenues
The Company was established on May 10, 2010, and
began to generate revenues during the third quarter of 2017 from
the sale of pain patches made with CBD oils. Our sales are
comprised of both website sales to individual consumers and
wholesale transactions with brick and mortar pharmacies, while our
cost of goods sold primarily consists of the products and the
packaging. We had revenues of $8,225 and $30,709 for the three and
nine months ended September 30, 2018, respectively. We had revenues
of $24,276 for the both the three and nine months ended September
30, 2017. The decrease in revenues in the three months ended
September 30, 2018 compared to the prior year was due to
disruptions involving our transition to a new merchant account
processor.
Cost of Goods Sold
Cost of goods sold
for the three and nine months ended
September 30, 2018 were $4,373 and $20,577,
respectively. Cost of goods sold for the three and nine months ended September
30, 2017 were $11,070. Cost of sales consists primarily
of product materials and packaging supplies. The decrease in cost
of goods sold in the three months ended September 30, 2018 compared
to the prior year was due to a decrease in revenues as explained in
the preceding paragraph.
21
General and Administrative
General
and administrative expenses were $62,572 and 139,881, respectively,
for the three and nine months ended September 30, 2018, compared to
$36,979 and $110,284, respectively, for the three and nine months
ended September 30, 2017, an increase of $25,593 and $29,597, or
69% and 27%, respectively. The increase in general and
administrative expenses was due primarily to increased advertising
and investor relations expenses.
Professional Fees
Professional fees expense was $22,613 and
$100,953, respectively, for the three and nine months ended
September 30, 2018, compared to $22,269 and $109,025, respectively,
for the three and nine months ended September 30, 2017, an increase
of $344 and a decrease $8,072, or an increase of 2% and a decrease
of 7%, respectively. Professional fees consist primarily of
legal and, accounting and auditing services.
Net Operating Loss
Net
operating loss was $81,333 and $230,702, respectively, for the
three and nine months ended September 30, 2018, compared to
$230,357 and $390,418, respectively, for the three and months ended
September 30, 2017, a decrease of $149,024 and $159,716, or 65% and
41%, respectively. Net operating loss decreased, as set forth
above, primarily due to the discontinuation of our research and
development efforts in the current year.
Other Income/Expense
Other
income (expense) was ($282,202) and $333,485, respectively, for the
three and nine months ended September 30, 2018, compared to
$3,951,918 and ($2,464,588), respectively, for the three and nine
months ended September 30, 2017, a decrease of $4,234,120 and an
increase of $2,798,073, respectively. Other expense for the three
months ended September 30, 2018 consisted of interest expense of
$184,624, and a loss of $97,578 in the market value of derivative
liabilities. The other income of $3,951,918 for the three months
ended September 30, 2017 consisted of a gain in the market
value of derivative liabilities of $3,993,216 offset by interest
expense of $37,124 and a loss of $4,174 in our terminated joint
venture.
Other
income for the nine months ended September 30, 2018 consisted of a
gain of $655,808 in market value of derivative liabilities, as
offset by interest expense of $322,323. The other expense of
$2,464,588 for the nine months ended September 30, 2017
consisted of interest expense of $190,471, a loss of $2,267,885 in
market value of derivative liabilities and an investment loss of
$6,232 in our terminated joint venture.
Net Income (Loss)
Net
income (loss) for the three and nine months ended September 30,
2018, was ($363,535) or ($0.11) per share, and $102,783 or $0.03
per share, respectively, compared to $3,721,561 or $1.83 per share,
and ($2,855,006) or ($1.52) per share, respectively, for the three
and nine months ended September 30, 2017. Net income (loss)
decreased, as set forth above, primarily due to the ($4,090,794)
difference between a loss in value of our derivative liabilities of
($97,578) and a gain in value of our derivative liabilities of
$3,993,216 for the three months ended September 30, 2018 and 2017,
respectively. Net income (loss) increased, as set forth above,
primarily due to the $2,957,789 difference between the gain in
value of our derivative liabilities of $655,808 and the loss in
value of our derivative liabilities of ($2,267,885) for the nine
months ended September 30, 2018 and 2017,
respectively.
22
Liquidity and Capital Resources
During the three
and nine months ended September 30, 2018, we had negative operating
cash flows. Our cash on hand as of September 30, 2018 was $63,204,
which was derived from the sale of shares of common stock, warrants
and convertible promissory notes to investors. Our monthly cash
flow burn rate for 2017 was approximately $42,500, and our monthly
burn rate through the nine months ended September 30, 2018 was
approximately $35,500. We have strong short-term cash needs as we
ramp up production and sales of our new products. We will face
strong medium to long term cash needs as we continue to grow the
business. We anticipate that these needs will be satisfied through
the issuance of debt or the sale of our securities until such time
as our cash flows from operations will satisfy our cash flow
needs.
Our cash, current
assets, total assets, current liabilities, and total liabilities as
of September 30, 2018 and December 31, 2017, respectively, are as
follows:
|
September
30,
|
December
31,
|
|
|
2018
|
2017
|
Change
|
|
|
|
|
Cash
|
$63,204
|
$83,704
|
$(20,500)
|
Total Current
Assets
|
222,391
|
203,603
|
18,788
|
Total
Assets
|
228,149
|
209,081
|
19,068
|
Total Current
Liabilities
|
2,471,901
|
2,819,807
|
(347,906)
|
Total
Liabilities
|
$2,471,901
|
$2,819,807
|
$(374,906)
|
Our cash and total
current assets decreased as we continued to sustain losses. Our
total current liabilities decreased primarily due to a reduction of
$447,836 in the value of our derivative liability. Our working
capital deficit decreased from ($2,616,204) to ($2,249,510), and
our stockholders’ deficit decreased by $366,974 to
($2,243,752) due primarily to the reduction in the value of our
derivative liability as well.
In order to repay
our obligations in full or in part when due, we will be required to
raise significant capital from other sources. There is no
assurance, however, that we will be successful in these
efforts.
Cash Requirements
Our cash on hand as
of September 30, 2018 was $63,204. Based on our minimal revenues
and current monthly burn rate of approximately $35,500 per month,
we will need to continue to fund operations by raising capital from
the sale of our stock and debt financings.
Sources and Uses of Cash
Operations
We had net cash
used in operating activities of $(318,471) for the nine months
ended September 30, 2018, compared to $(370,549) for the nine
months ended September 30, 2017. This decrease in net cash used in
operating activities was driven primarily by the cash that was no
longer used toward our research and development activities in the
current year.
Investments
We had $2,029 net
cash used in investing activities for the nine months ended
September 30, 2018, and $2,694 net cash used in investing
activities for the nine months ended September 30, 2017. We
outsource the manufacturing of our products, so our investment
expenses are minimal.
23
Financing
Our net cash
provided by financing activities for the nine months ended
September 30, 2018 was $300,000, which consisted of the proceeds
from the sale of convertible notes. For the nine months ended
September 30, 2017, net cash provided by financing was $453,323,
which consisted primarily of proceeds from the sale of stock of
$285,000, proceeds from the sale of convertible notes of $150,000
and proceeds of $18,323 from sales of stock pursuant to our equity
line of credit with Redwood Management, LLC.
Securities Purchase Agreement
On March 30, 2017,
we entered into a Securities Purchase Agreement with three
investors and raised $300,000 through the sale of stock and
warrants. These same investors purchased $150,000 of common stock
and warrants in the second tranche on May 30, 2017. On August 8,
2017, we exchanged convertible notes with the investors for the
warrants issued in the first tranche and the common stock issued in
the second tranche. We also amended the Securities Purchase
Agreement on that date, and on October 30, 2017, the investors
purchased an additional $150,000 of our convertible
notes.
Sale of Convertible Notes
Pursuant to a separate Securities Purchase
Agreement, we sold convertible notes to two investors for $60,000
on each of March 1, 2018 and April 24, 2018 and $180,000 on July
11, 2018, for an aggregate of $300,000. We sold two more
convertible notes on July 11, 2018 for an aggregate of
$180,000. We expect these investments, our growing revenues
and sales of common stock, warrants and convertible notes will
finance our operations for the next several months as we seek to
expand revenues from our new pain management products.
ITEM
3
Quantitative
and Qualitative Disclosures About Market Risk
As a smaller
reporting company, we are not required to provide the information
required by this Item.
ITEM
4
Controls
and Procedures
(a)
Disclosure
Controls and Procedures
We conducted an
evaluation, with the participation of our Chief Executive Officer
and Chief Financial Officer, of the effectiveness of the design and
operation of our disclosure controls and procedures, as defined in
Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of
1934, as amended, or the Exchange Act, as of September 30, 2018, to
ensure that information required to be disclosed by us in the
reports filed or submitted by us under the Exchange Act is
recorded, processed, summarized and reported, within the time
periods specified in the Securities Exchange Commission’s
rules and forms, including to ensure that information required to
be disclosed by us in the reports filed or submitted by us under
the Exchange Act is accumulated and communicated to our management,
including our principal executive and principal financial officer,
or persons performing similar functions, as appropriate to allow
timely decisions regarding required disclosure. Based on that
evaluation, our Chief Executive Officer and Chief Financial Officer
have concluded that as of September 30, 2018, our disclosure
controls and procedures were not effective at the reasonable
assurance level due to the material weaknesses identified and
described in our Annual Report on Internal Control Over Financial
Reporting filed in our Annual Report on Form 10-K.
24
Our
principal executive officers do not expect that our disclosure
controls or internal controls will prevent all errors and all
fraud. Although our disclosure controls and procedures were
designed to provide reasonable assurance of achieving their
objectives and our principal executive officers are determined to
make our disclosure controls and procedures effective at doing so,
a control system, no matter how well conceived and operated, can
provide only reasonable, not absolute assurance that the objectives
of the system are met. Further, the design of a control system must
reflect the fact that there are resource constraints, and the
benefits of controls must be considered relative to their costs.
Because of the inherent limitations in all control systems, no
evaluation of controls can provide absolute assurance that all
control issues and instances of fraud, if any, within the Company
have been detected. These inherent limitations include the
realities that judgments in decision-making can be faulty, and that
breakdowns can occur because of simple error or mistake.
Additionally, controls can be circumvented if there exists in an
individual a desire to do so. There can be no assurance that any
design will succeed in achieving its stated goals under all
potential future conditions.
(b)
Changes
in Internal Control over Financial Reporting
No
change in our system of internal control over financial reporting
occurred during the period covered by this report, the three month
period ended September 30, 2018, that has materially affected, or
is reasonably likely to materially affect, our internal control
over financial reporting.
25
PART
II – OTHER INFORMATION
ITEM
1 Legal
Proceedings
We are not a party
to or otherwise involved in any legal proceedings.
In the ordinary
course of business, we are from time to time involved in various
pending or threatened legal actions. The litigation process is
inherently uncertain and it is possible that the resolution of such
matters might have a material adverse effect upon our financial
condition and/or results of operations. However, in the opinion of
our management, other than as set forth herein, matters currently
pending or threatened against us are not expected to have a
material adverse effect on our financial position or results of
operations.
ITEM
1A
Risk Factors
As a smaller
reporting company, we are not required to provide the information
required by this Item.
ITEM
2 Unregistered
Sales of Equity Securities and Use of Proceeds
Except
as set forth below or previously reported on a Current Report on
Form 8-K, we had no unregistered sales of equity securities during
the three month period ended September 30, 2018.
On
June 27, 2018, the Company effected a 1-for-250 reverse stock split
(the “Reverse Stock Split”). No fractional shares were
issued, and no cash or other consideration was paid in connection
with the Reverse Stock Split. Instead, the Company issued one whole
share of the post-Reverse Stock Split common stock to any
stockholder who otherwise would have received a fractional share as
a result of the Reverse Stock Split. Accordingly, we issued 64
shares of common stock in the Reverse Stock Split to avoid the
issuance of fractional shares.
Convertible Debt
On
July 11, 2018, we received proceeds of $120,000 upon the issuance
of an 8% interest bearing, unsecured convertible promissory note
maturing on October 31, 2018 (“Third Red Diamond
Note”). The note was issued to RedDiamond Partners LLC and is
convertible at 60% of the lowest traded price of the Common Stock
in the fifteen (15) Trading Days prior to the Conversion Date. A
total of $25,920 of principal was converted into 348,667 shares of
common stock over various dates between July 27, 2018 and
August 23, 2018.
On
July 11, 2018, we received proceeds of $60,000 upon the issuance of
an 8% interest bearing; unsecured convertible promissory note
maturing on October 31, 2018 (“Third SEG-RedaShex
Note”). The note was issued to SEG-RedaShex, LLC and is
convertible at 60% of the lowest traded price of the Common Stock
in the fifteen (15) Trading Days prior to the Conversion
Date.
Issuances of Common Stock upon Conversions of Convertible
Debt
We have issued shares of common stock upon the
conversion of our convertible debt as set forth below. For an
explanation of defined terms and the notes mentioned below,
see Note 7
– Convertible Notes Payable, Currently in Default
and Note 10 – Changes in
Stockholders’ Equity (Deficit) of the financial statements.
On
September 24, 2018, we issued 172,176 shares of common stock The
Special Equities Group, LLC pursuant to the conversion of $12,500
of principal from the First SEG Note.
On
September 18, 2018, the Company issued 136,986 shares of common
stock to RedDiamond Partners LLC pursuant to the conversion of
$10,000 of principal from the First Red Diamond Note.
26
On
September 5, 2018, the Company issued 138,889 shares of common
stock to RedDiamond Partners LLC pursuant to the conversion of
$12,500 of principal from the First Red Diamond Note.
On
August 23, 2018, the Company issued 82,001 shares of common stock
to RedDiamond Partners LLC pursuant to the conversion of $4,920 of
principal from the Third Red Diamond Note.
On
August 20, 2018, the Company issued 160,000 shares of common stock
to The Special Equities Group, LLC pursuant to the conversion of
$9,600 of principal from the First SEG Note.
On
August 15, 2018, the Company issued 100,000 shares of common stock
to RedDiamond Partners LLC pursuant to the conversion of $6,000 of
principal from the Third Red Diamond Note.
On
August 9, 2018, the Company issued 83,333 shares of common stock to
RedDiamond Partners LLC pursuant to the conversion of $5,000 of
principal from the Third Red Diamond Note.
On
July 27, 2018, the Company issued 83,333 shares of common stock to
RedDiamond Partners LLC pursuant to the conversion of $10,000 of
principal from the Third Red Diamond Note.
On
November 12, 2018, the Company issued 150,000 shares of common
stock to The Special Equities Group, LLC pursuant to the conversion
of $13,500 of principal from the First SEG Note.
On
November 5, 2018, the Company issued 190,000 shares of common stock
to RedDiamond Partners LLC pursuant to the conversion of $8,075 of
principal from the First Red Diamond Note.
On
October 25, 2018, the Company issued 175,000 shares of common stock
to RedDiamond Partners LLC pursuant to the conversion of $8,750 of
principal from the First Red Diamond Note.
On
October 16, 2018, the Company issued 202,702 shares of common stock
to The Special Equities Group, LLC pursuant to the conversion of
$13,500 of principal from the First SEG Note.
On
October 12, 2018, the Company issued 175,000 shares of common stock
to RedDiamond Partners LLC pursuant to the conversion of $9,712 of
principal from the First Red Diamond Note.
On
October 3, 2018, the Company issued 111,940 shares of common stock
to RedDiamond Partners LLC pursuant to the conversion of $7,500 of
principal from the First Red Diamond Note.
ITEM
3 Defaults
Upon Senior Securities
There have been no
events which are required to be reported under this
Item.
ITEM
4 Mine
Safety Disclosures
Not
applicable.
ITEM
5 Other
Information
None.
27
ITEM
6 Exhibits
(a)
Exhibits
Exhibit
No.
|
|
Description of
Exhibits
|
|
8%
Convertible Promissory Note in the principal amount of $60,000
issued July 11, 2018 to SEG-RedaShex LLC
|
|
|
|
|
|
8%
Convertible Promissory Note in the principal amount of $120,000
issued July 11, 2018 to RedDiamond Partners LLC
|
|
|
|
|
|
Rule
13a-14(a)/15d-14(a) Certification of Chief Executive
Officer
|
|
|
|
|
|
Rule
13a-14(a)/15d-14(a) Certification of Chief Financial
Officer
|
|
|
|
|
|
Chief Executive
Officer Certification Pursuant to 18 USC, Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
|
|
|
|
Chief Financial
Officer Certification Pursuant to 18 USC, Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
|
|
|
101.INS
|
|
XBRL Instance
Document
|
|
|
|
101.SCH
|
|
XBRL Schema
Document
|
|
|
|
101.CAL
|
|
XBRL Calculation
Linkbase Document
|
|
|
|
101.DEF
|
|
XBRL Definition
Linkbase Document
|
|
|
|
101.LAB
|
|
XBRL Labels
Linkbase Document
|
|
|
|
101.PRE
|
|
XBRL Presentation
Linkbase Document
|
28
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.
|
Premier Biomedical,
Inc.
|
|
|
|
|
Dated:
November 26, 2018
|
/s/
William A. Hartman
|
|
By: William A. Hartman
|
|
Its: Chief Executive Officer
|
|
|
|
|
29