Attached files
| file | filename |
|---|---|
| EX-31.1 - CERTIFICATION - PREMIER HOLDING CORP. | prhl_10q-ex3101.htm |
| EX-32.1 - CERTIFICATION - PREMIER HOLDING CORP. | prhl_10q-ex3201.htm |
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
| S | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended June 30, 2012
OR
| £ | TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ___________ to _____________
PREMIER HOLDING CORP.
(Exact name of registrant as specified in its charter)
| Nevada | 000-53824 | 88-0344135 |
| (State or other jurisdiction of incorporation or organization) | (commission file no.) | (IRS Employee Identification No.) |
32 Journey, #250, Aliso Veijo, California 92656
(Current Address of Principal Executive Offices)
(888) 766-8311
(Issuer Telephone Number)
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, as amended (the “Exchange Act”) during the past 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 S No £
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer (as defined in Rule 12b-2of the Exchange Act). Check one:
| Large accelerated filer £ | Accelerated filer £ | Non-accelerated filer S |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes £ No S
The number of shares of Common Stock of the issuer outstanding as of August 20, 2012 was 48,097,020.
Table of Contents
| Page | |
| PART I – FINANCIAL INFORMATION | 3 |
| Item 1. Financial Statements | 3 |
| Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | 16 |
| Item 3. Quantitative and Qualitative Disclosures About Market Risk | 18 |
| Item 4. Controls and Procedures | 18 |
| PART II – OTHER INFORMATION | 20 |
| Item 1. Legal Proceedings | 20 |
| Item 1A. Risk Factors | 20 |
| Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 20 |
| Item 3. Defaults Upon Senior Securities | 20 |
| Item 4. Reserved | 20 |
| Item 5. Exhibits | 20 |
| Signatures | 21 |
| 2 |
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
PREMIER HOLDING CORPORATION
(a development stage company)
Balance Sheets
| (Unaudited) | (Audited) | |||||||
| June 30, | December 31, | |||||||
| 2012 | 2011 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 455,080 | $ | 259,948 | ||||
| Employee Advances | 9,000 | – | ||||||
| Inventory | 16,676 | – | ||||||
| Prepaid expenses | 35,988 | – | ||||||
| Total current assets | 516,744 | 259,948 | ||||||
| Other assets | 1,430 | – | ||||||
| Total Assets | $ | 518,174 | $ | 259,948 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 74,609 | $ | – | ||||
| Related party payable | 127,126 | – | ||||||
| Accrued expenses | 32,779 | – | ||||||
| Total current liabilities | 234,514 | – | ||||||
| Total liabilities | 234,514 | – | ||||||
| Stockholders’ Equity: | ||||||||
| Common Stock, 100,000,000 shares authorized, par value $.0001, 48,097,020 and 44,007,020, respectively, issued and outstanding. | 4,810 | 4,401 | ||||||
| Common Stock Payable | 29,750 | – | ||||||
| Additional Paid-in-Capital | 8,910,448 | 7,282,103 | ||||||
| Retained earnings - before development stage | (3,732,970 | ) | (3,732,970 | ) | ||||
| Deficit accumulated during development stage | (4,928,378 | ) | (3,293,586 | ) | ||||
| Total Stockholders’ Equity | 283,660 | 259,948 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 518,174 | $ | 259,948 | ||||
See accompanying notes to financial statements.
| 3 |
PREMIER HOLDING CORPORATION
(a development stage company)
Unaudited Statements of Operations
For the three and six month periods ended June 30, 2012 and 2011
and the period from May 18, 2007 to June 30, 2012
| May 18, 2007 | ||||||||||||||||||||
| (re-entry to development | ||||||||||||||||||||
| Three months ended | Six months ended | stage) through | ||||||||||||||||||
| June 30, | June 30, | June 30, | ||||||||||||||||||
| 2012 | 2011 | 2012 | 2011 | 2012 | ||||||||||||||||
| Revenues: | $ | 21,519 | $ | – | $ | 81,019 | $ | – | $ | 91,019 | ||||||||||
| Cost of Sales | (13,447 | ) | – | (40,416 | ) | – | (79,045 | ) | ||||||||||||
| Gross Profit | 8,072 | – | 40,603 | – | 11,974 | |||||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Selling, general and administrative | (1,189,413 | ) | (13,896 | ) | (1,674,041 | ) | (34,875 | ) | (4,898,859 | ) | ||||||||||
| Total operating expenses | (1,189,413 | ) | (13,896 | ) | (1,674,041 | ) | (34,875 | ) | (4,898,859 | ) | ||||||||||
| Operating loss | (1,181,341 | ) | (13,896 | ) | (1,633,438 | ) | (34,875 | ) | (4,886,885 | ) | ||||||||||
| Other income (expense): | ||||||||||||||||||||
| Interest expense | (1,121 | ) | – | (1,354 | ) | – | (7,698 | ) | ||||||||||||
| Other income (expense) | – | – | – | – | 980 | |||||||||||||||
| Gain (loss) on investments | – | – | – | – | 854 | |||||||||||||||
| Gain (loss) on sale of investments | – | – | – | – | (35,629 | ) | ||||||||||||||
| Total other income (expense) | (1,121 | ) | – | (1,354 | ) | – | (41,493 | ) | ||||||||||||
| Net loss | $ | (1,182,462 | ) | $ | (13,896 | ) | $ | (1,634,792 | ) | $ | (34,875 | ) | $ | (4,928,378 | ) | |||||
| Loss per common share — basic and diluted | $ | (0.03 | ) | $ | (0.00 | ) | $ | (0.04 | ) | $ | (0.00 | ) | ||||||||
| Weighted average number of common shares outstanding during the period | 45,845,841 | 8,315,845 | 45,266,665 | 8,315,845 | ||||||||||||||||
See accompanying notes to financial statements.
| 4 |
PREMIER HOLDING CORPORATION
(a development stage company)
Unaudited Statements of Cash Flows
For the three and six month periods ended June 30, 2012 and 2011
and the period from May 18, 2007 through June 30, 2012
| For the six months ended | May 18, 2007 (re-entry to development stage) through | |||||||||||
| June 30, | June 30, | |||||||||||
| 2012 | 2011 | 2012 | ||||||||||
| Cash flows from operating activities: | ||||||||||||
| Net loss | $ | (1,634,792 | ) | $ | (34,875 | ) | $ | (4,928,378 | ) | |||
| Adjustments to reconcile net loss to cash used in operations: | ||||||||||||
| Common stock issued for services | 175,200 | – | 258,990 | |||||||||
| Options issued for services | 490,756 | – | 3,528,861 | |||||||||
| Impairment loss | – | – | 17,024 | |||||||||
| Loss on sale of investments | – | – | 35,629 | |||||||||
| Imputed interest expense | 298 | – | 6,642 | |||||||||
| Change in operating assets and liabilities: | ||||||||||||
| Inventory | (16,676 | ) | (21,605 | ) | (16,676 | ) | ||||||
| Prepaid expenses | (46,418 | ) | – | (46,418 | ) | |||||||
| Accounts payable | 74,609 | – | 74,609 | |||||||||
| Related party payable | 127,126 | – | 127,126 | |||||||||
| Accrued expenses | 32,779 | – | 32,779 | |||||||||
| Other current liabilties | – | – | – | |||||||||
| Net cash used in operating activities | $ | (797,118 | ) | $ | (56,480 | ) | $ | (909,812 | ) | |||
| Cash flows from investing activities: | ||||||||||||
| Purchase of investments | $ | – | $ | – | $ | (242,172 | ) | |||||
| Advanced from related parties | – | 56,465 | – | |||||||||
| Proceeds from the sale of investments | – | – | 206,543 | |||||||||
| Net cash used in investing activities | $ | – | $ | 56,465 | $ | (35,629 | ) | |||||
| Cash flows from financing activities: | ||||||||||||
| Capital contributed for operations by related parties | $ | – | $ | – | $ | 11,605 | ||||||
| Net advances from related parties | – | – | 146,666 | |||||||||
| Common stock payable for cash | 29,750 | – | 29,750 | |||||||||
| Common stock issued for cash | 992,250 | – | 1,242,250 | |||||||||
| Net cash provided by financing activities | $ | 1,022,000 | $ | – | $ | 1,430,271 | ||||||
| Net increase in cash and cash equivalents | $ | 224,882 | $ | (15 | ) | $ | 484,830 | |||||
| Cash and cash equivalents at beginning of period | $ | 259,948 | $ | 10,716 | $ | – | ||||||
| Cash and cash equivalents at end of period | $ | 484,830 | $ | 10,701 | $ | 484,830 | ||||||
| Cash paid for income taxes | $ | – | $ | 1,600 | $ | 17,024 | ||||||
| Cash paid for interest | $ | – | $ | – | $ | – | ||||||
| Supplemental Schedule of Non-Cash Investing and Financing Activities | ||||||||||||
| Debt Extinguished from Issuance of Common Stock | $ | – | $ | 97,706 | $ | 146,666 | ||||||
See accompanying notes to financial statements.
| 5 |
PREMIER HOLDING CORPORATION
(a development stage company)
Unaudited Statement of Shareholder's Equity (Deficit)
| Common Stock | Additional Paid-in | Common Stock | Retained Earnings Prior to Development | Deficit Accumulated During Development | ||||||||||||||||||||||||
| Shares | Amount | Capital | Payable | Stage | Stage | Total | ||||||||||||||||||||||
| Balance, May 18, 2007 | 1,510,665 | $ | 151 | $ | 3,732,819 | $ | – | $ | (3,732,970 | ) | $ | – | $ | – | ||||||||||||||
| Stock issued for payment reimbursement and services by CEO | 3,491,250 | 349 | 83,441 | – | – | – | 83,790 | |||||||||||||||||||||
| Net loss | – | – | – | – | – | (83,790 | ) | (83,790 | ) | |||||||||||||||||||
| Balance, December 31, 2007 | 5,001,915 | $ | 500 | $ | 3,816,260 | $ | – | $ | (3,732,970 | ) | $ | (83,790 | ) | $ | – | |||||||||||||
| Net loss | – | – | – | – | – | (10,985 | ) | (10,985 | ) | |||||||||||||||||||
| Balance, December 31, 2008 | 5,001,915 | $ | 500 | $ | 3,816,260 | $ | – | $ | (3,732,970 | ) | $ | (94,775 | ) | $ | (10,985 | ) | ||||||||||||
| Net loss | – | – | – | – | – | (40,230 | ) | (40,230 | ) | |||||||||||||||||||
| Balance, December 31, 2009 | 5,001,915 | $ | 500 | $ | 3,816,260 | $ | – | $ | (3,732,970 | ) | $ | (135,005 | ) | $ | (51,215 | ) | ||||||||||||
| Cancellation of Stock | (757,125 | ) | (76 | ) | 76 | – | – | – | – | |||||||||||||||||||
| Net loss | – | – | – | – | – | (35,775 | ) | (35,775 | ) | |||||||||||||||||||
| Balance December 31, 2010 | 4,244,790 | $ | 424 | $ | 3,816,336 | $ | – | $ | (3,732,970 | ) | $ | (170,780 | ) | $ | (86,990 | ) | ||||||||||||
| Stock issued for payment reimbursement and services by CEO | 4,210,970 | 422 | 146,244 | – | – | – | 146,666 | |||||||||||||||||||||
| Shares issued for acquisitions | 30,551,290 | 3,055 | 3,052,074 | – | – | – | 3,055,129 | |||||||||||||||||||||
| Shares issued for cash | 5,000,000 | 500 | 249,500 | – | – | – | 250,000 | |||||||||||||||||||||
| Imputed interest | – | – | 6,344 | – | – | – | 6,344 | |||||||||||||||||||||
| Contributed capital | – | – | 11,605 | – | – | – | 11,605 | |||||||||||||||||||||
| Net loss | – | – | – | – | – | (3,122,806 | ) | (3,122,806 | ) | |||||||||||||||||||
| Balance as of December 31, 2011 | 44,007,020 | $ | 4,401 | $ | 7,282,103 | $ | – | $ | (3,732,970 | ) | $ | (3,293,586 | ) | $ | 259,948 | |||||||||||||
| Options issued for services | – | – | 490,756 | – | – | – | 490,756 | |||||||||||||||||||||
| Stock issued for services | 240,000 | 24 | 175,176 | – | – | – | 175,200 | |||||||||||||||||||||
| Stock issued for cash | 3,850,000 | 385 | 962,115 | – | – | – | 962,500 | |||||||||||||||||||||
| Stock payable for cash | – | – | – | 29,750 | – | – | 29,750 | |||||||||||||||||||||
| Imputed interest | – | – | 298 | – | – | – | 298 | |||||||||||||||||||||
| Net loss | – | – | – | – | – | (1,634,792 | ) | (1,634,792 | ) | |||||||||||||||||||
| Balance, June 30, 2012 | 48,097,020 | $ | 4,810 | $ | 8,910,448 | $ | 29,750 | $ | (3,732,970 | ) | $ | (4,928,378 | ) | $ | 283,660 | |||||||||||||
See accompanying notes to financial statements.
| 6 |
PREMIER HOLDING CORPORATION
(a development stage company)
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2012
NOTE 1 – DESCRIPTION OF BUSINESS
Premier Holding Corporation (“the Company”) is a development stage company. The Company is devoting substantially all of its efforts to establishing an energy services company. This business, which started during 2012, is primarily focused on provided small and large-scale commercial companies with energy solutions to reduce the costs of utilities through consultations as well as product sales to complete those installations via shipment from inventory on hand to the customer site. The Company’s principal operations of selling caskets through a commissioned sales force did not produce significant revenue in 2011. The Company is organized with a holding company structure such that the Company provides financial and management expertise, which includes access to capital, financing, legal, insurance, mergers, acquisitions, joint ventures and management strategies. The Company’s wholly owned subsidiary WEPOWER Ecolutions, Inc. (“WEPOWER”) offers renewable energy production and energy efficiency products and services to commercial middle market companies.
WEPOWER is a U.S. energy service company based in the Los Angeles area, that offers renewable energy production and energy efficiency products and services to commercial middle market companies, Fortune 500 brands, and developers and management companies of large scale residential developments. WEPOWER's business is focused as an integrator of clean technology solutions in the U.S., with strategic expansion plans in Latin America, Asia and Europe. WEPOWER's core business expects to deliver green solutions, branded specifically as "ecolutions", which include best-of-class alternative energy technology portfolio in wind turbines, solar power systems, green roofs, smart lighting controls, LED lighting, battery storage power plants, energy and power control management systems, fuel reduction solutions for transportation and other clean technologies specific to its market. Additional integrated business offerings will include direct energy services as power purchase agreements (PPAs), energy financing and leasing of solar and wind-powered generation programs in urban and rural real estate environments.
The Company was organized under the laws of the State of Nevada on October 18, 1971 under the name of Mr. Nevada, Inc., and, following the completion of a limited public offering in April 1972, commenced limited operations which were discontinued in 1990. Thereafter, the Company engaged in a reorganization and on several occasions sought to merge with or acquire certain active private companies or operations, all of which were terminated or resulted in discontinued negotiations. On October 20, 1995, the Company changed its name to Intermark Development Corporation. On November 4, 1996, the Company acquired all of the capital stock of HVM Development Limited ("HDL"), formerly known as OVM Development Limited, a British Virgin Islands corporation, and changed its name to OVM International Holding Corporation. On November 13, 2008, the Company filed a Certificate of Amendment to Articles of Incorporation with the State of Nevada Secretary of State to change its name from OVM International Holding Corporation to Premier Holding Corporation.
Interim Financial Statements
These unaudited financial statements as of and for the three and six months ended June 30, 2012 reflect all adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows for the period presented in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature.
These interim financial statements should be read in conjunction with the Company’s financial statements and notes thereto for the years ended December 31, 2011 and 2010 included in the Company’s Form 10-K filed with the United States Securities and Exchange Commission on April 11, 2012. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the three and six months ended June 30, 2012 are not necessarily indicative of results for the entire year ending December 31, 2012.
| 7 |
PREMIER HOLDING CORPORATION
(a development stage company)
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2012
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The summary of significant accounting policies for the Company is presented to assist in the understanding of the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. The accounting policies conform to generally accepted accounting principles and have been consistently applied in the preparation of the financial statements.
Accounting Method
The Company’s financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
Revenue Recognition
The Company’s wholly owned subsidiary WEPOWER Ecolutions, Inc. (“WEPOWER”) offers renewable energy production and energy efficiency products and services to commercial middle market companies. In accordance with the requirements of ASC 605-10-599, the Company recognizes revenue when (1) persuasive evidence of an arrangement exists (contracts); (2) delivery has occurred; (3) the seller’s price is fixed or determinable (per the customer’s contract); and (4) collectability is reasonably assured (based upon our credit policy). For consultations provided to customers the revenue is recognized at the completion of the service when collectability is reasonably assured. For products sold to customers revenue is recognized when title has passed to the customer and collectability is reasonably assured; and no further efforts are required on the part of WEPOWER. If further services are required, the revenue is deferred and recognized over the service term of the contract.
Accounts Receivable Policy
All accounts receivable are due thirty (30) days from the date billed. If the funds are not received within thirty (30) days the customer is contacted to arrange payment. The Company uses the allowance method to account for uncollectable accounts receivable. All accounts were considered collectable at period end and no allowance for bad debts was considered necessary.
Inventory Policy
Inventories are stated at the lower of cost (which is determined on a first-in, first-out method) or market and consists of finished goods. Finished goods on hand as of June 30, 2012, consisted of compressor and hydro-cat fuel catalysts. Reserves for slow moving and obsolete inventories are provided based on historical experience and product demand. A reserve for obsolete inventories was not required at June 30, 2012 and December 31, 2011.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the 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
Cash and cash equivalents include short-term cash investments that have an initial maturity of 90 days or less.
| 8 |
PREMIER HOLDING CORPORATION
(a development stage company)
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2012
Earnings Per Share
The Company has adopted the FASB ASC Topic regarding earnings per share, which provides for calculation of “basic” and “diluted” earnings per share. Basic earnings per share includes no dilution and is computed by dividing net income available to common shareholders by the weighted average common shares outstanding for the period. Diluted earnings per share reflects the potential dilution of securities that could share in the earnings of an entity similar to fully diluted earnings per share.
Income Tax
Deferred income tax is provided for differences between the bases of assets and liabilities for financial and income tax reporting. A deferred tax asset, subject to a valuation allowance, is recognized for estimated future tax benefits of tax-basis operating losses being carried forward.
Income taxes are provided based upon the liability method of accounting pursuant to the FASB ASC Topic 740-10-30 concerning Income Taxes. Under this approach, deferred income taxes are recorded to reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end. A valuation allowance is recorded against the deferred tax asset if management does not believe the Company has met the “more likely than not” standard imposed by the FASB ASC Topic 740-10-30 concerning Income Taxes to allow recognition of such an asset.
Stock-Based Compensation
Shares of the Company’s common stock may be issued for services. These issuances are valued at the fair market value of the services provided and the number of shares issued is determined based upon either (i) a recent sale by the Company for cash to an unrelated third party or (ii) the price of the Company’s common stock is on the date of each respective transaction.
Recent Accounting Pronouncements
The adoption of these accounting standards had the following impact on the Company’s statements of income and financial condition:
In December 2011, FASB issued Accounting Standards Update 2011-11, Balance Sheet - Disclosures about Offsetting Assets and Liabilities” to enhance disclosure requirements relating to the offsetting of assets and liabilities on an entity's balance sheet. The update requires enhanced disclosures regarding assets and liabilities that are presented net or gross in the statement of financial position when the right of offset exists, or that are subject to an enforceable master netting arrangement. The new disclosure requirements relating to this update are retrospective and effective for annual and interim periods beginning on or after January 1, 2013. The update only requires additional disclosures, as such, we do not expect that the adoption of this standard will have a material impact on our results of operations, cash flows or financial condition.
In June 2011, the FASB issued ASU 2011-05, “Comprehensive Income (Topic 220): Presentation of Comprehensive Income”, which is effective for annual reporting periods beginning after December 15, 2011. ASU 2011-05 will become effective for the Company on January 1, 2012. This guidance eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders’ equity. In addition, items of other comprehensive income that are reclassified to profit or loss are required to be presented separately on the face of the financial statements. This guidance is intended to increase the prominence of other comprehensive income in financial statements by requiring that such amounts be presented either in a single continuous statement of income and comprehensive income or separately in consecutive statements of income and comprehensive income. The adoption of ASU 2011-05 is not expected to have a material impact on the Company’s financial position or results of operations.
| 9 |
PREMIER HOLDING CORPORATION
(a development stage company)
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2012
In May 2011, the FASB issued ASU 2011-04, “Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs”, which is effective for annual reporting periods beginning after December 15, 2011. This guidance amends certain accounting and disclosure requirements related to fair value measurements. Additional disclosure requirements in the update include: (1) for Level 3 fair value measurements, quantitative information about unobservable inputs used, a description of the valuation processes used by the entity, and a qualitative discussion about the sensitivity of the measurements to changes in the unobservable inputs; (2) for an entity’s use of a nonfinancial asset that is different from the asset’s highest and best use, the reason for the difference; (3) for financial instruments not measured at fair value but for which disclosure of fair value is required, the fair value hierarchy level in which the fair value measurements were determined; and (4) the disclosure of all transfers between Level 1 and Level 2 of the fair value hierarchy. ASU 2011-04 will become effective for the Company on January 1, 2012. The Company is currently evaluating ASU 2011-04 and has not yet determined the impact that adoption will have on its financial statements.
Fair Value Measurements
On January 1, 2011, the Company adopted guidance which defines fair value, establishes a framework for using fair value to measure financial assets and liabilities on a recurring basis, and expands disclosures about fair value measurements. Beginning on January 1, 2011, the Company also applied the guidance to non-financial assets and liabilities measured at fair value on a non-recurring basis, which includes goodwill and intangible assets. The guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions of what market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of the inputs as follows:
Level 1 - Valuation is based upon unadjusted quoted market prices for identical assets or liabilities in active markets that the Company has the ability to access.
Level 2 -Valuation is based upon quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; or valuations based on models where the significant inputs are observable in the market.
Level 3 - Valuation is based on models where significant inputs are not observable. The unobservable inputs reflect the Company's own assumptions about the inputs that market participants would use.
The following table presents assets and liabilities that are measured and recognized at fair value as of June 30, 2012 on a recurring and non-recurring basis:
| Description | Level 1 | Level 2 | Level 3 | Gains (Losses) | ||||||||||||||
| $ | – | $ | – | $ | – | $ | – | |||||||||||
The following table presents assets and liabilities that are measured and recognized at fair value as of December 31, 2011 on a recurring and non-recurring basis:
| Description | Level 1 | Level 2 | Level 3 | Gains (Losses) | ||||||||||||||
| $ | – | $ | – | $ | – | $ | – | |||||||||||
The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities. The estimated fair value of cash, accounts receivable, accounts payable and accrued liabilities approximate their carrying amounts due to the short-term nature of these instruments.
| 10 |
PREMIER HOLDING CORPORATION
(a development stage company)
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2012
Concentration of Credit Risk
The Company maintains its cash and cash equivalents in multiple financial institutions. Balances in banks are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per institution. Balances on deposit may occasionally exceed FDIC insured amounts. The Company also maintains cash and money market funds in a brokerage account insured by the Securities Investor Protection Corporation (SIPC) which insures cash balances up to $100,000.
NOTE 3 – DEVELOPMENT STAGE COMPANY
The Company has had recurring losses during its development stage. The Company’s financial statements are prepared using generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business.
NOTE 4 – RELATED PARTY TRANSACTIONS
On or about November 15, 2007, an officer and director was issued 3,491,250 shares of common stock; $43,759 worth in exchange for company expenses paid and $40,030 worth for services rendered, for a total of $83,790 worth of stock, pursuant to Section 4(2) of the Securities Act of 1933. The expenses advanced were to pay for transfer agent fees, legal fees, independent accountant fees and the defaulted corporate charter.
On January 29, 2011, an officer and director was issued 4,071,085 shares of restricted stock, valued at $0.024 per share based on the market price of the Company’s stock for retirement of a debt of the Company owed to Jack Gregory for the amount of $97,706.
During the 2011, an officer and director had advanced $70,636 to the Company for the payment of general and administrative expenses. The advance was recorded as an interest free loan. The Company imputed interest of $6,344, charging income and increasing additional paid in capital. The debt for the advance was retired with the issuance of 139,885 shares of restricted stock with a fair value of $12,590, valued at $0.09 per share, based on the market price of the Company’s stock, and a cash payment of $21,676 resulting in an increase to additional paid-in-capital of $48,957. No gain was recognized on this transaction due to the fact that it was between the Company and a related party.
In December 2011, an officer and director made a capital contribution of $11,605 for operations.
Between May 18, 2007 and February 29, 2012, all activities of the Company were conducted by corporate officers from either their homes or business offices. Currently, there are no outstanding debts owed by the Company for the use of these facilities and there are no commitments for future use of the facilities.
On December 29, 2011, the Company issued 16,497,695 shares of common stock valued at $1,649,770 based on the market price of the Company’s stock to WePower, LLC to acquire certain assets.
The acquisition of assets from WePower, LLC was accounted for as a related party transaction because on December 31, 2011, two days after the transaction date of December 29, 2011, WePower, LLC owned approximately thirty-seven percent of the Company. Because the assets acquired were from a related party, no value was assigned to the identified assets, other than the inventory which had a cost basis of $17,024. The assets were brought into the Company at their cost of $17,024; with the difference between cost and the total value of stock issued recorded as stock issuance expense.
| 11 |
PREMIER HOLDING CORPORATION
(a development stage company)
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2012
See below for the purchase price allocation:
| Inventory (at cost) | $ | 17,024 | ||
| Stock issuance expense | $ | 1,632,746 | ||
| Common stock, based on par value of $0.0001 | $ | (1,650 | ) | |
| Additional paid-in-capital, based on December 29, 2011 price of $0.10 per share | $ | (1,648,120 | ) |
Immediately after the acquisition was recorded, the inventory balance was tested and found to be impaired; therefore, at December 31, 2011, the inventory balance was stated at fair value of $0.
On December 29, 2011, the Company issued 14,053,595 shares of common stock valued at $1,405,359 based on the market price of the Company’s stock to Green Central Holdings, Inc. to acquire certain assets. The acquisition of assets from Green Central Holdings, Inc. was accounted for as a related party transaction because on December 31, 2011, two days after the transaction date of December 29, 2011, Green Central Holdings, Inc. owned approximately thirty-two percent of the Company. Because the assets acquired were from a related party, no value was assigned to the assets. The assets were brought into the Company at their cost of $0; with the total value of stock issued recorded as stock issuance expense.
See below for the purchase price allocation:
| Stock issuance expense | $ | 1,405,359 | ||
| Common stock, based on par value of $0.0001 | $ | (1,405 | ) | |
| Additional paid-in-capital, based on December 29, 2011 price of $0.10 per share | $ | (1,403,954 | ) |
As of June 30, 2012, several related parties were owed funds pertaining to operating expenses incurred during the period. Green Central Holdings Inc. was owed $70,592; and WePower, LLC was owed $56,534; totaling $127,126. No related parties were owed monies as of December 31, 2011. Imputed interest of $298 was charged during the period ended June 30, 2012; no amounts were charged during the period ended June 30, 2011.
NOTE 5 – CAPITAL STOCK TRANSACTIONS
Common Stock
The Company’s authorized capital consists of 100,000,000 shares of common stock $.0001 par value.
Based upon the record date of February 7, 2012 (the “Record Date”), the Company declared a 5:1 forward split payable as a stock dividend. On February, 10, 2012 (the “Payment Date”), the Company’s transfer agent mailed a certificate for 4 new shares of common stock for each 1 share of common stock held by each stockholder on the Record Date. On February 13, 2012 (the “Ex Date”), the trading of the common stock under symbol “PRHL” was adjusted by FINRA to reflect the forward split. The financial statements have been adjusted for all periods presented to reflect the 5:1 forward split payable as a stock dividend.
On February 16, 2012, the Company entered into a stock purchase agreement with an accredited investor for the sale of 1,000,000 shares of its common stock at a purchase price of $0.25 per share. The sale closed and cash of $250,000 was received on February 16, 2012.
On February 28, 2012, the Company entered into a stock purchase agreement with an accredited investor for the sale of 560,000 shares of its common stock at a purchase price of $0.25 per share. The sale closed and cash of $140,000 was received on February 29, 2012.
Effective April 11, 2012, the Company granted 240,000 shares to its legal service provider Weed & Co. LLP as payment for services. The shares were valued based on the closing market price on the grant date of April 11, 2012 at $0.73 per share, totaling $175,200. The stock was issued on May 8, 2012.
| 12 |
PREMIER HOLDING CORPORATION
(a development stage company)
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2012
On June 15, 2012, the Company sold and issued 2,290,000 shares of common stock to six accredited investors for $572,500. There was no underwriter, no underwriting discounts or commissions, no general solicitation, no advertisement, and resale restrictions were imposed by placing a Rule 144 legend on the certificates. The persons who received securities have such knowledge in business and financial matters that he/she/it is capable of evaluating the merits and risks of the transaction. This transaction was exempt from registration under the Securities Act of 1933, based upon Section 4(2) for transactions by the issuer not involving any public offering.
On June 27, 2012, the Company sold, but had not issued, as of June 30, 2012, 119,000 shares of common stock to five accredited investors for $29,750. There was no underwriter, no underwriting discounts or commissions, no general solicitation, no advertisement, and resale restrictions were imposed by placing a Rule 144 legend on the certificates. The persons who received securities have such knowledge in business and financial matters that he/she/it is capable of evaluating the merits and risks of the transaction. This transaction was exempt from registration under the Securities Act of 1933, based upon Section 4(2) for transactions by the issuer not involving any public offering.
Common Stock Options
On April 30, 2012, the Company granted 924,140 stock options to a Director, Frank Schulte to purchase shares at $0.40 per share. The options expire June 30, 2015, 462,070 vested on the grant date and 462,070 vest on July 31, 2012. The total estimated value using the Black-Scholes Model, based on a volatility rate of 102%, expected term of 2.08, risk free rate of 0.27 percent, and a call option value of $0.5082, was $469,659. For the 462,070 stock options which were immediately vested, the stock expensed was $234,830 on that date; for the stock 462,070 stock options that were to vest on July 31, 2012, $156,553 was expensed during the six months ended June 30, 2012: for a total amount of stock option expense of $391,383 for the six months ended June 30, 2012.
On May 15, 2012, the Company granted 75,000 stock options to a Director, Bobby Grisham to purchase shares at $0.40 per share. The options expire June 30, 2015 and vested on the grant. The total estimated value using the Black-Scholes Model, based on a volatility rate of 112%, expected term of 2.08, risk free rate of 0.29 percent, and a call option value of $0.7540, was $56,550. As the stock options were immediately vested, the stock expensed was $56,550 on that date and for the period ended June 30, 2012.
A summary of option activity as of June 30, 2012 and changes during the six months then ended is presented below:
| Weighted - | Weighted - | |||||||||||
| Average | Average | |||||||||||
| Number | Exercise Price | Remaining Contractual | ||||||||||
| Outstanding | Per Share | Life (Years) | ||||||||||
| Outstanding at January 1, 2012 | – | $ | – | – | ||||||||
| Granted | 999,140 | 0.40 | 3.16 | |||||||||
| Exercised | – | – | – | |||||||||
| Canceled/forfeited/expired | – | – | – | |||||||||
| Outstanding at June 30, 2012 | 999,140 | $ | 0.40 | 3.00 | ||||||||
| Options vested and exercisable at June 30, 2012 | 537,070 | $ | 0.40 | 3.00 | ||||||||
| 13 |
PREMIER HOLDING CORPORATION
(a development stage company)
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2012
Common Stock Warrants
On January 4, 2012, the Company granted 750,000 Common Stock Warrants (the “Warrants”) to its legal service provider Weed & Co. LLP to purchase shares at $0.06 per share (forward split adjusted). The Warrants expire on December 31, 2012 and are vested upon the date of grant. The total estimated value using the Black-Scholes Model, based on a volatility rate of 100%, expected term of 1 year, risk free rate of 0.12 percent, and a call option value of $0.0541, was $40,542. As the Warrants were immediately vested, the stock expensed was $40,542 on that date and for the period ended June 30, 2012.
On April 12, 2012, the Company granted 150,000 Common Stock Purchase Warrants (the “Warrants”) to a Consultant, Romy Consulting, Inc. that allows the purchase of shares at $0.73 per share. The Warrants expire 3 years after vesting. 5,000 of the Warrants vested on April 12, 2012 and the remaining Warrants vest based upon certain milestones relating to cumulative sales revenue from the Consultant’s efforts. 45,000 Warrants vest after cumulative sales revenue of $1,000,000; 50,000 Warrants vest after cumulative sales revenue of $6,000,000; and 50,000 Warrants vest after vest after cumulative sales revenue of $11,000,000. The total estimated value using the Black-Scholes Model, based on a volatility rate of 102%, expected term of 3, risk free rate of 0.43 percent, and a call option value of $0.4563, was $2,281. As 5,000 of the stock options were immediately vested, the stock warrants expense was $2,281 on that date and for the period ended June 30, 2012. As the remaining 145,000 options are contingent upon events that are not probable, no expense was recognized for the period ended June 30, 2012.
On June 29, 2012, the Company granted 150,000 Common Stock Purchase Warrants (the “Warrants”) to a Consultant, Gary Canter, Inc. that allows the purchase of shares at $1.27 per share. The Warrants expire 3 years after vesting. The Warrants vest based upon certain milestones relating to cumulative sales revenue from the Consultant’s efforts. 5,000 Warrants vest upon the receipt of the first sales from finder’s sales sources; 20,000 Warrants vest after cumulative sales revenue of $1,000,000; 50,000 Warrants vest after cumulative sales revenue of $6,000,000; and 75,000 Warrants vest after vest after cumulative sales revenue of $11,000,000. As the 150,000 options are contingent upon events that are not probable, no expense was recognized for the period ended June 30, 2012.
A summary of non-employee warrant activity during the six months ended and as of June 30, 2012 is presented below:
| Weighted - | Weighted - | |||||||||||
| Average | Average | |||||||||||
| Number | Exercise Price | Remaining Contractual | ||||||||||
| Outstanding | Per Share | Life (Years) | ||||||||||
| Outstanding at January 1, 2012 | – | $ | – | – | ||||||||
| Granted | 1,100,000 | 0.33 | 1.57 | |||||||||
| Exercised | – | – | – | |||||||||
| Canceled/forfeited/expired | – | – | – | |||||||||
| Outstanding at June 30, 2012 | 1,100,000 | $ | 0.33 | 1.19 | ||||||||
| Warrants vested and exercisable at June 30, 2012 | 755,000 | $ | 0.06 | 0.52 | ||||||||
NOTE 6 – GOING CONCERN
As shown in the accompanying consolidated financial statements, the Company has accumulated shareholder’s deficit during and before the development stage of $7,026,556 and total equity of $259,948 as of December 31, 2011, and accumulated shareholder’s deficit during and before the development stage of $8,661,348 and total equity of $283,660 as of June 30, 2012. The Company is continually reviewing its operations and attempting to improve operating results and its balance sheet. The Company's ability to continue as a going concern is dependent on its ability to improve operating results and increase its financing cash flows. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
| 14 |
PREMIER HOLDING CORPORATION
(a development stage company)
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2012
NOTE 7 – SUBSEQUENT EVENTS
On July 17, 2012, the Company granted 75,000 stock options to Director, Adm. Thomas C. Lynch, to purchase shares at $0.25 per share. The options expire June 30, 2015 and vested on the grant date.
On July 17, 2012, the Company granted 200,000 Common Stock Purchase Warrants (the “Warrants”) to Consultant, Adm. Thomas C. Lynch that allows the purchase of shares at $0.30 per share. The Warrants expire 3 years after vesting. 5,000 of the Warrants vested on July 17, 2012 and the remaining Warrants vest based upon certain milestones relating to cumulative sales revenue from the Consultant’s efforts. 45,000 Warrants vest after cumulative sales revenue of $1,000,000; 50,000 Warrants vest after cumulative sales revenue of $6,000,000; and 50,000 Warrants vest after vest after cumulative sales revenue of $11,000,000.
On July 23, 2012, the Company appointed Adm. Thomas C. Lynch to the board of directors.
On July 25, 2012, the Company entered into an Asset Purchase Agreement (the “Agreement”) with Active ES Lighting Controls, Inc. (“AES”) whereby the Company acquired AES's intellectual property including patents, trademarks and website. The Company paid AES $30,000, plus 750,000 shares of the Company’s common stock for the assets. The Company has an obligation to pay $15,000 on or before December 15, 2012 under the Agreement. Moreover, the Company has an obligation to issue up to 875,000 additional shares of common stock to AES during the next 18 months that is contingent upon the volume weighted average price (“VWAP”) of the Company’s common stock between December 26, 2012 and December 25, 2013.
On July 29, 2012, the Company appointed Woodrow W. Clark II, M.A. Ph.D. to the board of directors.
On July 29, 2012, the Company granted 75,000 stock options to a Director, Woodrow W. Clark II, to purchase shares at $0.25 per share. The options expire June 30, 2015 and vested on the grant date.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis should be read in conjunction with the accompanying financial statements and related notes included elsewhere in this report. It contains forward-looking statements that reflect our future plans, estimates, beliefs and expected performance. The forward-looking statements are dependent upon events, risks and uncertainties that may be outside our control. Our actual results could differ materially from those discussed in these forward-looking statements.
Factors that could cause or contribute to such differences include, but are not limited to, market prices for natural gas and oil, economic and competitive conditions, capital expenditures and other uncertainties, as well as those factors discussed below, all of which are difficult to predict and which expressly qualify all subsequent oral and written forward-looking statements attributable to us or persons acting on our behalf. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. We do not have any intention or obligation to update forward-looking statements included in this report after the date of this report, except as required by law.
INTRODUCTION
The following discussion and analysis summarizes the significant factors affecting: (i) our plan of operations for the three months and six months ended June 30, 2012. This discussion and analysis should be read in conjunction with our consolidated financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2011.
EXECUTIVE SUMMARY
Premier Holding Corporation (“the Company”) is a development stage company. The Company is devoting substantially all of its efforts to establishing an energy services company. The Company’s planned principal operations of selling caskets through a commissioned sales force did not produce significant revenue in 2011. The Company is organized with a holding company structure such that the Company provides financial and management expertise, which includes access to capital, financing, legal, insurance, mergers, acquisitions, joint ventures and management strategies. The Company’s wholly owned subsidiary WEPOWER Ecolutions, Inc. (“WEPOWER”) offers renewable energy production and energy efficiency products and services to commercial middle market companies.
WEPOWER is a U.S. energy service company based in the Los Angeles area that offers renewable energy production and energy efficiency products and services to commercial middle market companies, Fortune 500 brands, and developers and management companies of large scale residential developments. WEPOWER's business is focused as an integrator of clean technology solutions in the U.S., with strategic expansion plans in Latin America, Asia and Europe. WEPOWER's core business expects to deliver green solutions, branded specifically as "ecolutions," which include best-of-class alternative energy technology portfolio in wind turbines, solar power systems, green roofs, smart lighting controls, LED lighting, battery storage power plants, energy and power control management systems, fuel reduction solutions for transportation and other clean technologies specific to its market. Additional integrated business offerings will include direct energy services as power purchase agreements (PPAs), energy financing and leasing of solar and wind-powered generation programs in urban and rural real estate environments.
Although planned principal operations for WEPOWER commenced during the quarter ended March 31, 2012; there has been no significant revenue during the six month period ended June 30, 2012.
Results of Operations
The financial information with respect to the six months ended June 30, 2012 and 2011 that is discussed below is unaudited. In the opinion of management, such information contains all adjustments, consisting only of normal recurring accruals, necessary for a fair presentation of the results for such periods. The results of operations for interim periods are not necessarily indicative of the results of operations for the full fiscal years.
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Company Overview for the six months ended June 30, 2012 and 2011
During the six months ended June 30, 2012, the Company devoted substantially all of its efforts to establishing an energy services company through its wholly owned subsidiary WEPOWER Ecolutions, Inc. (“WEPOWER”). The Company’s planned principal operations of selling caskets through a commissioned sales force did not produce significant revenue in 2011.
The Company had revenue of $81,019 and incurred a net loss of $1,634,792 during the six months ended June 30, 2012 compared to revenue of $0 and a net loss of $34,875 for the six months ended June 30, 2011. The Company had revenue of $21,519 and incurred a net loss of $1,182,462 during the three months ended June 30, 2012 compared to revenue of $0 and a net loss of $13,896 for the three months ended June 30, 2011.
Sales. During the three months ended June 30, 2012 and 2011 sales of our products amounted to $21,519 and $0, respectively. During the six months ended June 30, 2012 and 2011, sales of our products amounted to $81,019 and $0, respectively. The increase can be attributed to the acquisition of WEPOWER.
Cost of Sales. During the three months ended June 30, 2012 and 2011, cost of sales amounted to $13,447 and $0, respectively. During the six months ended June 30, 2012 and 2011, cost of sales amounted to $40,416 and $0, respectively. The increase can be attributed to the acquisition of WEPOWER.
Selling, general and administrative. During the three months ended June 30, 2012 and 2011, selling, general and administrative expenses amounted to $1,189,413 and $13,896, respectively. During the six months ended June 30, 2012 and 2011, selling, general and administrative expenses amounted to $1,674,041 and $34,875, respectively. The increase in selling, general and administrative expenses in the three and six months ended June 30, 2012 can be attributed to increased legal expenses, contract labor and office expenses.
Other income (expense). During the three months ended June 30, 2012 and 2011, other income (expense) amounted to $1,121 and $0, respectively. During the six months ended June 30, 2012 and 2011, other income (expense) amounted to $1,354 and $0, respectively. The increase can be attributed to the interest earned on cash raised from equity sales during the three and six months ended June 30, 2012.
Going Concern
At June 30, 2012, we have total stockholder’s equity of $283,660 and an accumulated deficit of $8,661,348 incurred prior to and during the development stage. We may require additional funding to sustain our operations and satisfy our contractual obligations for our planned operations. Our ability to establish the Company as a going concern is may be dependent upon our ability to obtain additional funding in order to finance our planned operations.
Plan of Operation
For the remainder of fiscal 2012, we will focus on attempting to continue increase our revenue through the sale of our products and services which we hope to achieve by offering renewable energy production and energy efficiency products and services to commercial middle market companies, Fortune 500 brands, and developers and management companies of large scale residential developments.
Liquidity and Capital Resources
During our most recent quarter ended June 30, 2012, our cash flows from operations were not sufficient for us to meet our operating commitments. Our cash flows from operations continue to be, and are expected to continue to be, insufficient to meet our operating commitments throughout the remainder of the fiscal year ending December 31, 2012.
Working Capital. As of June 30, 2012, we had working capital of $282,230 and cash of $455,080, while at December 31, 2011 we had working capital of $259,948 and cash of $259,948. The increase in our working capital is primarily attributable to the sale of common stock. We do not expect our working capital to change dramatically in the near future.
| 17 |
Cash Flow. Net cash used in or provided by operating, investing and financing activities for the six months ended June 30, 2012 and 2011 were as follows:
| Six Months Ended June 30, | ||||||||
| 2012 | 2011 | |||||||
| Net cash (used) in operating activities | $ | (797,118 | ) | (56,480 | ) | |||
| Net cash (used) in investing activities | $ | – | 56,465 | |||||
| Net cash provided by financing activities | $ | 992,250 | – | |||||
Net Cash Used in Operating Activities. The changes in net cash used in operating activities are attributable to our net income adjusted for non-cash charges as presented in the consolidated statements of cash flows and changes in working capital as discussed above.
Net Cash Used in Investing Activities. There was no cash used in investing activities during the periods ended June 30, 2012 and $56,465 was received as an advance from a related party during the six months ended June 30, 2011.
Net Cash Provided by Financing Activities. Net cash provided by financing activities relates primarily to cash received from sales of our common stock.
Off-Balance Sheet Arrangements
We do not have off-balance sheet arrangements.
Critical Accounting Policies and Estimates
Our consolidated financial statements have been prepared by management in accordance with U.S. GAAP. We refer you to the corresponding section in Part II Item 7 and the notes to the consolidated financial statements of our Annual Report on Form 10-K for the year ended December 31, 2011 for the description of critical accounting policies and estimates.
Recently Issued Accounting Pronouncements
The Company has evaluated recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA and the SEC and we have not identified any that would have a material impact on the Company’s financial position, or statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.
Item 4. Controls and Procedures
Our Principal Executive Officer and Principal Accounting Officer have carried out an evaluation of the effectiveness of our disclosure, controls and procedures. Based upon that evaluation, our Principal Executive Officer and Principal Accounting Officer concluded that as of the end of the period covered by this report, our disclosures, controls and procedures are not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms. During the most recently completed three months ended June 30, 2012, there has been no significant change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
We do not have an independent body to oversee our internal controls over financial reporting and lack segregation of duties due to the limited nature and resources of the Company.
| 18 |
In light of these material weaknesses, we performed additional analysis and procedures in order to conclude that our financial statements included in this report were fairly stated in accordance with accounting principles generally accepted in the United States. Accordingly, we believe that despite our material weaknesses, our financial statements included in this report are fairly stated, in all material respects, in accordance with United States generally accepted accounting principles.
We plan to rectify these weaknesses by implementing an independent board of directors and hiring additional accounting personnel once we have additional resources to do so. We have also hired a new financial consultant who possesses additional financial reporting experience to assist the Company in future fillings.
CHANGES IN INTERNAL CONTROLS
Our management, with the participation the Principal Executive Officer and Principal Accounting Officer performed an evaluation as to whether any change in our internal controls over financial reporting occurred during the Quarter ended June 30, 2012. Based on that evaluation, the Company's Principal Executive Officer and Principal Accounting Officer concluded that no change occurred in the Company's internal controls over financial reporting during the Quarter ended June 30, 2012 that has materially affected, or is reasonably likely to materially affect, the Company's internal controls over financial reporting.
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PART II – OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 1a. Risk Factors.
As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.
Item 2 Unregistered Sales of Equity Securities and Use Of Proceeds
On June 15, 2012, the Company sold and issued 2,290,000 shares of common stock to six accredited investors for $572,500. There was no underwriter, no underwriting discounts or commissions, no general solicitation, no advertisement, and resale restrictions were imposed by placing a Rule 144 legend on the certificates. The persons who received securities have such knowledge in business and financial matters that he/she/it is capable of evaluating the merits and risks of the transaction. This transaction was exempt from registration under the Securities Act of 1933, based upon Section 4(2) for transactions by the issuer not involving any public offering.
On June 27, 2012, the Company sold, but had not issued, as of June 30, 2012, 119,000 shares of common stock to five accredited investors for $29,750. There was no underwriter, no underwriting discounts or commissions, no general solicitation, no advertisement, and resale restrictions were imposed by placing a Rule 144 legend on the certificates. The persons who received securities have such knowledge in business and financial matters that he/she/it is capable of evaluating the merits and risks of the transaction. This transaction was exempt from registration under the Securities Act of 1933, based upon Section 4(2) for transactions by the issuer not involving any public offering.
Item 3. Defaults Upon Senior Securities
None.
Item 4. [Reserved]
Item 5. Exhibits
| Exhibit No. | Exhibit | |
| 31.1 | Rule 13a-14(a)/15d-14(a) certification of Certificate of Principal Executive Officer and Principal Financial Officer | |
| 32.1 | Section 1350 Certification of Principal Executive Officer and Principal Financial Officer | |
| 101.INS | XBRL Instance Document* | |
| 101.SCH | XBRL Taxonomy Extension Schema* | |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase* | |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase* | |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase* | |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase* |
* Pursuant to Rule 405(a)(2) of Regulation S-T, the Company will furnish the XBRL Interactive Data Files with detailed footnote tagging as Exhibit 101 in an amendment to this Form 10-Q within the permitted 30-day grace period granted for the first quarterly period in which detailed footnote tagging is required.
| 20 |
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 Holding Corporation | ||
| August 20, 2012 | By: | /s/ Kevin B. Donovan |
Kevin B. Donovan Principal Executive Officer and Principal Financial Officer |
||
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