PREMIER BIOMEDICAL INC - FORM 10-Q

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EX-31.1 - CERTIFICATION - PREMIER BIOMEDICAL INC	biei_ex311.htm
EX-31.2 - CERTIFICATION - PREMIER BIOMEDICAL INC	biei_ex312.htm
EX-32.2 - CERTIFICATION - PREMIER BIOMEDICAL INC	biei_ex322.htm
EX-32.1 - CERTIFICATION - PREMIER BIOMEDICAL INC	biei_ex321.htm
EXCEL - IDEA: XBRL DOCUMENT - PREMIER BIOMEDICAL INC	Financial_Report.xls

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 March 31, 2013

o	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		27-2635666
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

970 Lake Carillon Drive, Suite 300 St. Petersburg, FL		33716
(Address of principal executive offices)		(Zip Code)

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 x No o

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 o

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

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

Applicable only to issuers involved in bankruptcy proceedings during the preceding five years:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes o No o

Applicable only to corporate issuers:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of May 14, 2013, there were 15,584,479 shares of common stock, $0.00001 par value, issued and outstanding.

PREMIER BIOMEDICAL, INC.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

ITEM 1	Financial Statements	4

ITEM 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31

ITEM 3	Quantitative and Qualitative Disclosures About Market Risk	34

ITEM 4	Controls and Procedures	35

PART II – OTHER INFORMATION

ITEM 1	Legal Proceedings	36

ITEM 1A	Risk Factors	36

ITEM 2	Unregistered Sales of Equity Securities and Use of Proceeds	36

ITEM 3	Defaults Upon Senior Securities	37

ITEM 4	Mine Safety Disclosures	37

ITEM 5	Other Information	37

ITEM 6	Exhibits	37

PART I – FINANCIAL INFORMATION

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.

ITEM 1

Financial Statements

PREMIER BIOMEDICAL, INC.

(A DEVELOPMENT STAGE COMPANY)

CONDENSED BALANCE SHEETS

	March 31,			December 31,
	2013			2012
	(Unaudited)
ASSETS
Current assets:
Cash	$	173,404		$	40,284
Prepaid expenses		563			69
Total current assets		173,967			40,353

Property and equipment, net		2,880			3,042

Total assets	$	176,847		$	43,395


LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current liabilities:
Accounts payable	$	161,943		$	88,598
Accounts payable, related parties		23,737			18,563
Notes payable, related parties		12,000			12,000
Total current liabilities		197,680			119,161

Commitments and contingencies		-			-

Stockholders' equity (deficit):
Preferred stock, $0.001 par value, 10,000,000 shares
authorized, no shares issued and outstanding		-			-
Common stock, $0.00001 par value, 300,000,000 shares
authorized, 15,584,479 and 12,374,479 shares issued and
outstanding at March 31, 2013 and December 31, 2012, respectively		156			124
Additional paid in capital		4,439,802			1,732,151
Subscriptions payable, -0- and 40,000 shares at
March 31, 2013 and December 31, 2012, respectively		-			20,000
(Deficit) accumulated during development stage		(4,460,791	)		(1,828,041	)
Total stockholders' equity (deficit)		(20,833	)		(75,766	)

Total liabilities and stockholders' equity (deficit)	$	176,847		$	43,395

See accompanying notes to financial statements.

PREMIER BIOMEDICAL, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)

							May 10, 2010
	For the Three Months Ended						(inception) to
	March 31, 2013			March 31, 2012			March 31, 2013

Revenue	$	-		$	-		$	-

Operating expenses:
Research and development		83,679			-			162,083
General and administrative		2,318,400			9,503			2,374,567
Professional fees		230,431			17,429			1,876,495
Impairment of patents		-			-			46,591
Total operating expenses		2,632,510			26,932			4,459,736

Net operating loss		(2,632,510	)		(26,932	)		(4,459,736	)

Other expense:
Interest expense		(240	)		-			(1,055	)
Total other expenses		(240	)		-			(1,055	)

Loss before provision for income taxes		(2,632,750	)		(26,932	)		(4,460,791	)

Provision for income taxes		-			-			-

Net loss	$	(2,632,750	)	$	(26,932	)	$	(4,460,791	)

Weighted average number of common shares outstanding - basic and fully diluted		13,951,146			11,451,200

Net loss per share - basic and fully diluted	$	(0.19	)	$	(0.00	)

See accompanying notes to financial statements.

PREMIER BIOMEDICAL, INC.

(A DEVELOPMENT STAGE COMPANY)

STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

	Preferred Stock				Common Stock				Additional Paid-In			Subscriptions			(Deficit) Accumulated During Development			Total Stockholders' Equity
	Shares		Amount		Shares		Amount		Capital			Payable			Stage			(Deficit)

Patent rights and applications contributed by director		-	$	-		-	$	-	$	14,817		$	-		$	-		$	14,817

Units of common stock and warrants sold to founders at $0.00001 per share		-		-		10,000,000		100		-			-			-			100

Net loss from May 10, 2010 (inception) to December 31, 2010		-		-		-		-		-			-			(2,156	)		(2,156	)

Balance, December 31, 2010		-	$	-		10,000,000	$	100	$	14,817		$	-		$	(2,156	)	$	12,761

Common stock sold to founders at $0.00001 per share		-		-		500,000		5		-			-			-			5

Units of common stock and warrants sold at $0.10 per share		-		-		723,200		7		72,313			-			-			72,320

Common stock sold at $0.25 per share		-		-		228,000		3		56,997			-			-			57,000

Net loss for the year ended December 31, 2011		-		-		-		-		-			-			(111,862	)		(111,862	)

Balance, December 31, 2011		-	$	-		11,451,200	$	115	$	144,127		$	-		$	(114,018	)	$	30,224

Imputed interest on non-interest bearing related party debts		-		-		-		-		626			-			-			626

Warrants granted for services, related parties		-		-		-		-		1,469,257			-			-			1,469,257

Exercise of cashless warrants		-		-		249,990		2		(2	)		-			-			-

Exercise of warrants at $0.10 per share		-		-		470,000		5		46,995			-			-			47,000

Units of common stock and warrants sold at $0.35 per share		-		-		203,289		2		71,148			-			-			71,150

Units of common stock and warrants sold at $0.50 per share		-		-		-		-		-			20,000			-			20,000

Net loss for the year ended December 31, 2012		-		-		-		-		-			-			(1,714,023	)		(1,714,023	)

Balance, December 31, 2012		-	$	-		12,374,479	$	124	$	1,732,151		$	20,000		$	(1,828,041	)	$	(75,766	)

Imputed interest on non-interest bearing related party debts		-		-		-		-		240			-			-			240

Amortization of warrants granted for services, related parties		-		-		-		-		129,993			-			-			129,993

Common stock issued for services		-		-		50,000		1		36,449			-			-			36,450

Common stock sold to Directors at $0.05 per share		-		-		3,000,000		30		149,970			-			-			150,000

Fair value of common stock in excess of cash value of stock sold to Directors		-		-		-		-		2,315,000			-			-			2,315,000

Exercise of warrants at $0.10 per share		-		-		10,000		-		1,000			-			-			1,000

Units of common stock and warrants sold at $0.50 per share		-		-		150,000		1		74,999			(20,000	)		-			55,000

Net loss for the three months ended March 31, 2013		-		-		-		-		-			-			(2,632,750	)		(2,632,750	)

Balance, March 31, 2013 (Unaudited)		-	$	-		15,584,479	$	156	$	4,439,802		$	-		$	(4,460,791	)	$	(20,833	)

See accompanying notes to financial statements.

PREMIER BIOMEDICAL, INC.

(A DEVELOPMENT STAGE COMPANY)

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

							May 10, 2010
	For the Three Months Ended						(inception) to
	March 31, 2013			March 31, 2012			March 31, 2013
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss)	$	(2,632,750	)	$	(26,932	)	$	(4,460,791	)
Adjustments to reconcile net loss to net cash used in operating activities:
Impairment of patents		-			-			46,591
Depreciation		162			-			363
Imputed interest on non-interest bearing related party debts		240			-			866
Stock based compensation		2,481,443			-			3,950,700
Decrease (increase) in assets:
Prepaid expenses		(494	)		(562	)		(563	)
Increase (decrease) in liabilities:
Accounts payable		73,345			4,697			161,943
Accounts payable, related parties		5,174			-			5,314
Net cash used in operating activities		(72,880	)		(22,797	)		(295,577	)

CASH FLOWS FROM INVESTING ACTIVITIES
Payments on patent rights and applications		-			-			(13,351	)
Purchases of property and equipment		-			-			(3,243	)
Net cash used in investing activities		-			-			(16,594	)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable, related parties		-			-			15,355
Repayments on notes payable, related parties		-			-			(3,355	)
Proceeds from the sale of common stock		206,000			-			473,575
Net cash provided by financing activities		206,000			-			485,575

NET CHANGE IN CASH		133,120			(22,797	)		173,404
CASH AT BEGINNING OF PERIOD		40,284			26,264			-

CASH AT END OF PERIOD	$	173,404		$	3,467		$	173,404

SUPPLEMENTAL INFORMATION:
Interest paid	$	-		$	-
Income taxes paid	$	-		$	-

NON-CASH INVESTING AND FINANCING ACTIVITIES:
Purchase of patent rights and applications paid subsequent to period end	$	-		$	5,834

See accompanying notes to financial statements.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

Note 1 – Nature of Business and Significant Accounting Policies

Nature of Business

Premier Biomedical, Inc. (“the Company”) was incorporated in the state of Nevada on May 10, 2010 (“Inception”). The Company was formed to develop and market medications and procedures that address a significant number of the most highly visible health issues currently affecting mankind. The Company will market these medications and procedures to leading worldwide pharmaceutical firms via publication in medical journals and by direct contact.

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.

Development Stage Company

The Company is currently considered a development stage company as defined by FASB ASC 915-10-05. As a development stage enterprise, the Company discloses the deficit accumulated during the development stage and the cumulative statements of operations and cash flows from inception to the current balance sheet date. An entity remains in the development stage until such time as, among other factors, revenues have been realized. To date, the development stage of the Company’s operations consists of developing the business model and marketing concepts.

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.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

Basic and Diluted Loss Per Share

The basic net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted net loss per common share is computed by dividing the net loss adjusted on an “as if converted” basis, by the weighted average number of common shares outstanding plus potential dilutive securities. For the periods presented, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

Stock-Based Compensation

The Company adopted FASB guidance on stock based compensation upon inception at May 10, 2010. 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 recognized $129,993 and $-0- of compensation expense related to common stock warrants issued for services for the three months ended March 31, 2013 and 2012, respectively, and $36,450 and $-0- of compensation expense related to common stock issued for services for the three months ended March 31, 2013 and 2012, respectively.

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. No sales have yet commenced.

Advertising and Promotion

All costs associated with advertising and promoting products are expensed as incurred. These expenses were $902 and $-0- for the three months ended March 31, 2013 and 2012, 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.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

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.

Recent Accounting Pronouncements

In February 2013, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, to improve the transparency of reporting these reclassifications. Other comprehensive income includes gains and losses that are initially excluded from net income for an accounting period. Those gains and losses are later reclassified out of accumulated other comprehensive income into net income. The amendments in the ASU do not change the current requirements for reporting net income or other comprehensive income in financial statements. All of the information that this ASU requires already is required to be disclosed elsewhere in the financial statements under U.S. GAAP. The new amendments will require an organization to:

Present (either on the face of the statement where net income is presented or in the notes) the effects on the line items of net income of significant amounts reclassified out of accumulated other comprehensive income - but only if the item reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period; and

Cross-reference to other disclosures currently required under U.S. GAAP for other reclassification items (that are not required under U.S. GAAP) to be reclassified directly to net income in their entirety in the same reporting period. This would be the case when a portion of the amount reclassified out of accumulated other comprehensive income is initially transferred to a balance sheet account (e.g., inventory for pension-related amounts) instead of directly to income or expense.

The amendments apply to all public and private companies that report items of other comprehensive income. Public companies are required to comply with these amendments for all reporting periods (interim and annual). The amendments are effective for reporting periods beginning after December 15, 2012, for public companies. Early adoption is permitted. The adoption of ASU No. 2013-02 did not have a material impact on our financial position or results of operations.

In January 2013, the FASB issued ASU No. 2013-01, Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities, which clarifies which instruments and transactions are subject to the offsetting disclosure requirements originally established by ASU 2011-11. The new ASU addresses preparer concerns that the scope of the disclosure requirements under ASU 2011-11 was overly broad and imposed unintended costs that were not commensurate with estimated benefits to financial statement users. In choosing to narrow the scope of the offsetting disclosures, the Board determined that it could make them more operable and cost effective for preparers while still giving financial statement users sufficient information to analyze the most significant presentation differences between financial statements prepared in accordance with U.S. GAAP and those prepared under IFRSs. Like ASU 2011-11, the amendments in this update will be effective for fiscal periods beginning on, or after January 1, 2013. The adoption of ASU 2013-01 did not have a material impact on our financial position or results of operations.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

Note 2 – Going Concern

As shown in the accompanying financial statements, the Company has no revenues, incurred net losses from operations resulting in an accumulated deficit of $4,460,791 and a working capital deficit of $23,713 as of March 31, 2013. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management is actively pursuing new ventures to increase revenues. In addition, 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 $23,442 and $18,423 as of March 31, 2013 and December 31, 2012, respectively, to an entity owned by the Chairman of the Board of Directors. The amounts are related to patent costs.

The Company owed $295 and $140 as of March 31, 2013 and December 31, 2012, respectively, to the Company’s CEO for reimbursable expenses.

Notes Payable

The Company has received short term loans from Officers and Directors as disclosed in Note 6 below.

Common Stock

On February 27, 2013, the Company sold 500,000 shares of its common stock to the Chairman of the Board of Directors in exchange for proceeds of $25,000. Board of director compensation expense of $365,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price.

On February 20, 2013, the Company sold 1,000,000 shares of its common stock to a Director in exchange for proceeds of $50,000. Board of director compensation expense of $780,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

On February 20, 2013, the Company sold 1,500,000 shares of its common stock to a Director in exchange for proceeds of $75,000. Board of director compensation expense of $1,170,000 was recognized due to the fair value of the shares in excess of the $0.05 per share purchase price.

On June 8, 2012, the Company sold 6,000 shares of its common stock and an equal number of warrants exercisable at $0.50 per share over a one year term pursuant to a unit offering in exchange for proceeds of $2,100 to one of the Company’s Directors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On January 20, 2011, the Company sold 500,000 founder’s shares at the par value of $0.00001 per share in exchange for proceeds of $5 to a newly appointed director. The sale of these units was simply to establish the internal ownership, which occurred prior to the commencement of any operational activities, or offerings to the public or friends and family members. The Company was essentially dormant from the date of formation, May 10, 2010 through the date when the unit sales occurred as part of the Company’s formation. As a result, the difference between the fair value of the shares and the cash received was not recorded as compensation expense. The shares issued carried a total fair value of $160, or $0.00032 per share using the Option-pricing Method to Allocation – Option Value by Capital Structure method is as follows:

-	500,000 shares of common stock valued at a total of $160, or $0.00032 per share, based on a 115% expected price volatility, estimated term of 12 months, risk-free interest rate of 0.29% and a dividends rate of 0%.

On June 21, 2010, the Company sold 3,000,000 founder’s shares at the par value of $0.00001 per share, at a fair value of $960, or $0.00032 per share, along with warrants to purchase 1,000,000 shares of series A convertible preferred stock at $0.001 per share over a ten year period from the date of issuance and warrants to purchase 17,000,000 shares of common stock at $0.00001 per share over a ten year period from the date of issuance, in exchange for proceeds of $30 to the Company’s CEO. The sale of these units was simply to establish the internal ownership, which occurred prior to the commencement of any operational activities, or offerings to the public or friends and family members. The Company was essentially dormant from the date of formation, May 10, 2010 through the date when the unit sales occurred as part of the Company’s formation. As a result, the difference between the fair value of the shares and the cash received was not recorded as compensation expense. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The fair value of the common stock issuance to the founder using the Option-pricing Method to Allocation – Option Value by Capital Structure method is as follows:

-	3,000,000 shares of common stock valued at a total of $960, or $0.00032 per share, based on a 115% expected price volatility, estimated term of 12 months, risk-free interest rate of 0.29% and a dividends rate of 0%.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

The total fair value of the warrant issuances to the founder using the Black-Scholes option-pricing model is as follows:

-	Warrants to purchase 1,000,000 shares of series A convertible preferred stock valued at a total of $890, or $0.00089 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $390.

-	Warrants to purchase 17,000,000 shares of common stock valued at a total of $3,910, or $0.00023 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $1,530.

On June 21, 2010, the Company sold 3,000,000 founder’s shares at the par value of $0.00001 per share, and an intrinsic value of $960, or $0.00032 per share, along with warrants to purchase 1,000,000 shares of series A convertible preferred stock at $0.001 per share over a ten year period from the date of issuance and warrants to purchase 17,000,000 shares of common stock at $0.00001 per share over a ten year period from the date of issuance, in exchange for proceeds of $30 to the Company’s Chairman of the Board. The sale of these units was simply to establish the internal ownership, which occurred prior to the commencement of any operational activities, or offerings to the public or friends and family members. The Company was essentially dormant from the date of formation, May 10, 2010 through the date when the unit sales occurred as part of the Company’s formation. As a result, the difference between the fair value of the shares and the cash received was not recorded as compensation expense. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The fair value of the common stock issuance to the founder using the Option-pricing Method to Allocation – Option Value by Capital Structure method is as follows:

-	3,000,000 shares of common stock valued at a total of $960, or $0.00032 per share, based on a 115% expected price volatility, estimated term of 12 months, risk-free interest rate of 0.29% and a dividends rate of 0%.

The total fair value of the warrant issuances to the founder using the Black-Scholes option-pricing model is as follows:

-	Warrants to purchase 1,000,000 shares of series A convertible preferred stock valued at a total of $890, or $0.00089 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $390.

-	Warrants to purchase 17,000,000 shares of common stock valued at a total of $3,910, or $0.00023 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $1,530.

On June 21, 2010, the Company sold a total of 4,000,000 founder’s shares at the par value of $0.00001 per share in exchange for total proceeds of $40 to four of the Company’s directors. The shares issued carried a total fair value of $1,280, or $0.00032 per share using the Option-pricing Method to Allocation – Option Value by Capital Structure method. The sale of these units was simply to establish the internal ownership, which occurred prior to the commencement of any operational activities, or offerings to the public or friends and family members. The Company was essentially dormant from the date of formation, May 10, 2010 through the date when the unit sales occurred as part of the Company’s formation. As a result, the difference between the fair value of the shares and the cash received was not recorded as compensation expense. The fair value of the common stock issuances to the founders using the Option-pricing Method to Allocation – Option Value by Capital Structure method is as follows:

-	1,000,000 shares of common stock issued to each of four Directors valued at $320 each, or $0.00032 per share, based on a 115% expected price volatility, estimated term of 12 months, risk-free interest rate of 0.29% and a dividends rate of 0%.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

Common Stock Warrants

On October 1, 2012, the Company granted 1,000,000 common stock warrants to each of two Directors to purchase a total of 2,000,000 shares of common stock at $1.45 per share for services provided above and beyond their services as Directors. The warrants are fully vested, and are exercisable over seven (7) years from the date of grant. The total fair value of the 2,000,000 common stock warrants using the Black-Scholes option-pricing model is $1,321,496, or $0.6608 per share, based on a volatility rate of 100%, a risk-free interest rate of 0.39% and an expected term of 3.5 years, and was expensed as professional fee expense during the year ended December 31, 2012.

On September 28, 2012, the Company granted common stock warrants to the Company’s CEO pursuant to the commencement of an employment agreement to purchase a total of 105,000 shares of common stock at $1.45 per share for his services as an Officer. The warrants carry a vesting period of 50% on January 15, 2013 and the remaining 50% vest on June 15, 2013. The option to exercise this warrant shall only be available if the Company’s common stock reaches a bid price of three dollars ($3.00) per share and remains at or above three dollars ($3.00) per share for thirty (30) consecutive trading days on any and all markets or exchanges which the Company’s common stock is traded (triggering event). The warrants are exercisable over seven (7) years after the triggering event. The fair value of the 105,000 common stock warrants using the Black-Scholes option-pricing model is $74,798, or $0.7315 per share, based on a 76% discount using a 24% probability that the triggering event would be satisfied, a volatility rate of 108%, a risk-free interest rate of 0.49% and an expected term of 3.76 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized $6,375 and $-0- of amortization recorded to professional fee expense during the three months ended March 31, 2013 and 2012, respectively. The unamortized balance at March 31, 2013 was $5,269.

On September 28, 2012, the Company granted common stock warrants to the Company’s Chairman of the Board of Directors pursuant to the commencement of an employment agreement to purchase a total of 105,000 shares of common stock at $1.45 per share for his services as the Chairman of the Board. The warrants carry a vesting period of 50% on January 15, 2013 and the remaining 50% vest on June 15, 2013. The option to exercise this warrant shall only be available if the Company’s common stock reaches a bid price of three dollars ($3.00) per share and remains at or above three dollars ($3.00) per share for thirty (30) consecutive trading days on any and all markets or exchanges which the Company’s common stock is traded (triggering event). The warrants are exercisable over seven (7) years after the triggering event. The fair value of the 105,000 common stock warrants using the Black-Scholes option-pricing model is $74,798, or $0.7315 per share, based on a 76% discount using a 24% probability that the triggering event would be satisfied, a volatility rate of 108%, a risk-free interest rate of 0.49% and an expected term of 3.76 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized $6,375 and $-0- of amortization recorded to professional fee expense during the three months ended March 31, 2013 and 2012, respectively. The unamortized balance at March 31, 2013 was $5,269.

On September 28, 2012, the Company granted 50,000 common stock warrants to each of nine Directors to purchase a total of 450,000 shares of common stock at $1.45 per share over a seven year period from the grant date for their services as Directors. The warrants carry a vesting period of 50% on January 15, 2013 and the remaining 50% vest on June 15, 2013. The total fair value of the 450,000 common stock warrants using the Black-Scholes option-pricing model is $320,564, or $0.7315 per share, based on a volatility rate of 108%, a risk-free interest rate of 0.49% and an expected term of 3.76 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized a total of $110,964 and $-0- of amortization recorded to professional fee expense during the three months ended March 31, 2013 and 2012, respectively. The unamortized balance at March 31, 2013 was $10,190.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

On September 28, 2012, the Company granted 70,000 common stock warrants to each of three Directors to purchase a total of 210,000 shares of common stock at $1.45 per share for services provided above and beyond their services as Directors. The warrants carry a vesting period of 50% on January 15, 2013 and the remaining 50% vest on June 15, 2013. The option to exercise this warrant shall only be available if the Company’s common stock reaches a bid price of three dollars ($3.00) per share and remains at or above three dollars ($3.00) per share for thirty (30) consecutive trading days on any and all markets or exchanges which the Company’s common stock is traded (triggering event). The warrants are exercisable over seven (7) years after the triggering event. In accordance with Accounting Standards Codification (“ASC”) 505-50, non-employee stock based compensation awards are re-measured at each period. The total fair value of the 210,000 common stock warrants using the Black-Scholes option-pricing model is $133,788, or $0.6371 per share as of December 31, 2012, based on a 76% discount using a 24% probability that the triggering event would be satisfied, a volatility rate of 88%, a risk-free interest rate of 1.18% and an expected term of 7 years. The Company recognized a total of $2,028 and $-0- of professional fee expense during the three months ended March 31, 2013 and 2012, respectively.

On September 28, 2012, the Company granted common stock warrants to one of the Directors to purchase 70,000 shares of common stock at $1.45 per share for services provided above and beyond their services as Directors. The warrants carry a vesting period of 50% on January 15, 2013 and the remaining 50% vest on June 15, 2013. The option to exercise this warrant shall only be available if the Company’s common stock reaches a bid price of three dollars ($3.00) per share and remains at or above three dollars ($3.00) per share for thirty (30) consecutive trading days on any and all markets or exchanges which the Company’s common stock is traded (triggering event). The warrants are exercisable over seven (7) years after the triggering event. The total fair value of the 70,000 common stock warrants using the Black-Scholes option-pricing model is $49,865, or $0.7315 per share, based on a 76% discount using a 24% probability that the triggering event would be satisfied, a volatility rate of 108%, a risk-free interest rate of 0.49% and an expected term of 3.76 years, and is being amortized over the implied service term, or vesting period, of the warrants. The Company recognized $4,251 and $-0- of professional fee expense during the three months ended March 31, 2013 and 2012, respectively. The unamortized balance at March 31, 2013 was $3,513.

Note 4 – 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. As of January 1, 2013, 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. During the years ended December 31, 2012 and 2011, the Company performed reviews of the carrying value of its patent rights and applications and, as a result, the Company wrote off a total book value of $31,774 and $14,817, respectively, in patent rights and applications related to discontinued pursuit of international patents, and due to the uncertainty of deriving a future economic benefit from our patents.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

Note 5 – Fair Value of Financial Instruments

The Company adopted FASB ASC 820-10 upon inception at May 10, 2010. 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.

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 March 31, 2013 and December 31, 2012:

	Fair Value Measurements at March 31, 2013
	Level 1		Level 2			Level 3
Assets
Cash	$	173,404	$	-		$	-
Patent rights and applications		-		-			-
Total assets		173,404		-			-
Liabilities
Notes payable, related parties		-		12,000			-
Total liabilities		-		12,000			-
	$	173,404	$	(12,000	)	$	-

	Fair Value Measurements at December 31, 2012
	Level 1		Level 2			Level 3
Assets
Cash	$	40,284	$	-		$	-
Patent rights and applications		-		-			-
Total assets		40,284		-			-
Liabilities
Notes payable, related parties		-		12,000			-
Total liabilities		-		12,000			-
	$	40,284	$	(12,000	)	$	-

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

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 three months ended March 31, 2013 or the year ended December 31, 2012.

The Company recorded fair value adjustments of $-0- and $31,774 during the three months ended March 31, 2013 and the year ended December 31, 2012, respectively, related to the impairment of the carrying value of its patent rights and applications.

Note 6 – Notes Payable, Related Parties

Notes payable, related parties consist of the following at March 31, 2013 and December 31, 2012, respectively:

	March 31,		December 31,
	2013		2012

On May 4, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand from the Company’s CEO.	$	3,000	$	3,000

On May 4, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand and a from the Company’s Chairman of the Board of Directors.		3,000		3,000

On May 4, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand from one of the Company’s Directors.		3,000		3,000

On May 7, 2012, the Company received an unsecured, non-interest bearing loan in the amount of $3,000, due on demand from one of the Company’s Directors.		3,000		3,000

Total notes payable, related parties		12,000		12,000
Less: current portion		12,000		12,000
Notes payable, related parties, less current portion	$	-	$	-

The Company recorded imputed interest expense in the amount of $240 and $-0- for the three months ended March 31, 2013 and 2012, respectively related to notes payable, related parties.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

Note 7 – Commitments and Contingencies

On May 9, 2012, we entered into a Collaborative Agreement with the University of Texas at El Paso. Pursuant to the terms of the Agreement, we will work jointly with the University to develop a series of research and development programs around our 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. We 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 us. The agreement has an initial term of five (5) years, and is renewable upon mutual agreement of the parties.

Note 8 – Stockholders’ Equity

Common Stock (2013)

On March 11, 2013, a warrant holder elected to exercise warrants consisting of a 10,000 shares of its common stock pursuant to a unit offering previously sold on February 28, 2011 in exchange for proceeds of $1,000.

On March 11, 2013, the Company sold 10,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $5,000. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On March 2, 2013, the Company granted 50,000 shares of common for services performed. The total fair value of the common stock was $36,450 based on the closing price of the Company’s common stock on the date of grant.

On February 17, 2013, the Company sold 5,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $2,500. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

On February 10, 2013, the Company sold 20,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $10,000. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On January 30, 2013, the Company sold 60,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $30,000. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On January 22, 2013, the Company sold 15,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $7,500. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On January 9, 2013, the Company issued 40,000 shares of its common stock that were sold on December 31, 2012 pursuant to a unit offering in exchange for proceeds of $20,000 that were presented as a subscriptions payable at December 31, 2012.

Common Stock (2012)

On December 31, 2012, the Company sold 40,000 shares of its common stock and an equal number of warrants exercisable at $0.75 per share over a one year term pursuant to a unit offering in exchange for proceeds of $20,000. The shares were subsequently issued on January 9, 2013, as such, the proceeds are presented as a subscriptions payable at December 31, 2012.

On October 24, 2012, a warrant holder elected to exercise warrants consisting of a 10,000 shares of its common stock pursuant to a unit offering previously sold on February 28, 2011 in exchange for proceeds of $1,000.

On September 21, 2012, four warrant holders elected to exercise warrants consisting of a total of 40,000 shares of its common stock pursuant to unit offerings previously sold on February 28, 2011 in exchange for total proceeds of $4,000.

On various dates from August 9, 2012 through September 18, 2012, the Company issued a total of 420,000 shares of the Company’s common stock at $0.10 per share amongst a total of forty four warrant holders, in exchange for total proceeds of $42,000 pursuant to warrant exercise notices from unit offerings previously sold on February 28, 2011.

On August 15, 2012, the Company sold 3,000 shares of its common stock and an equal number of warrants exercisable at $0.50 per share over a one year term pursuant to a unit offering in exchange for proceeds of $1,050. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On August 9, 2012, the Company sold 10,000 shares of its common stock and an equal number of warrants exercisable at $0.50 per share over a one year term pursuant to a unit offering in exchange for proceeds of $3,500. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

On July 16, 2012, the Company sold 14,285 shares of its common stock and an equal number of warrants exercisable at $0.50 per share over a one year term pursuant to a unit offering in exchange for proceeds of $5,000. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On July 2, 2012, a warrant holder elected to exercise 250,000 cashless warrants of a total of 2,500,000 held, exercisable at $0.00001 per share. As a result, the Company issued an aggregate of 249,990 shares of common stock. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investor was accredited, had the opportunity to meet with and ask questions of management, and there was no solicitation in connection with the offering.

On June 11, 2012, the Company sold a total of 160,004 shares of its common stock and an equal number of warrants exercisable at $0.50 per share over a one year term pursuant to a unit offering in exchange for total proceeds of $56,000. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

Common Stock (2011)

On various dates from April 1, 2011 through June 3, 2011, the Company sold a total of 228,000 shares of the Company’s common stock at $0.25 per share, in exchange for total proceeds of $57,000 to a total of eighteen independent investors. The Company was able to increase its offering price from its February 28, 2011 offerings due to developments with regard to an anticipated Cooperative Research and Development Agreement, or CRADA, involving clinical tests on patients which it anticipates will be conducted in conjunction with the Department of Defense, along with the increased enterprise value generated from the capital previously received.

On February 28, 2011, the Company sold a total of 723,200 shares of the Company’s common stock at $0.10 per share, along with warrants to purchase a total of 723,200 shares of common stock at $0.10 per share over a one year period beginning from the date the Company began trading on a public stock exchange, which was August 1, 2012, in exchange for total proceeds of $72,320 to a total of eighty five independent investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The total fair value of the 723,200 common stock warrants using the Black-Scholes option-pricing model is $1,121, or $0.00155 per share, based on a 105% volatility, risk-free interest rate of 3.27% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $506. The Company was able to increase its offering price as it advanced in the development of its business, along with the progression of events that will enable it to bring the Company to a public trading platform and increase the implied value attributed to the potential liquidity to third party investors.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

-	500,000 shares of common stock valued at a total of $160, or $0.00032 per share, based on a 115% expected price volatility, estimated term of 12 months, risk-free interest rate of 0.29% and a dividends rate of 0%.

Common Stock (2010)

-	3,000,000 shares of common stock valued at a total of $960, or $0.00032 per share, based on a 115% expected price volatility, estimated term of 12 months, risk-free interest rate of 0.29% and a dividends rate of 0%.

The total fair value of the warrant issuances to the founder using the Black-Scholes option-pricing model is as follows:

-	Warrants to purchase 1,000,000 shares of series A convertible preferred stock valued at a total of $890, or $0.00089 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $390.

-	Warrants to purchase 17,000,000 shares of common stock valued at a total of $3,910, or $0.00023 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $1,530.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

On June 21, 2010, the Company sold 3,000,000 founder’s shares at the par value of $0.00001 per share, and an intrinsic value of $960, or $0.00032 per share, along with warrants to purchase 1,000,000 shares of series A convertible preferred stock at $0.001 per share over a ten year period from the date of issuance and warrants to purchase 17,000,000 shares of common stock at $0.00001 per share over a ten year period from the date of issuance, in exchange for proceeds of $30 to the Company’s Chairman of the Board. The sale of these units was simply to establish the internal ownership, which occurred prior to the commencement of any operational activities, or offerings to the public or friends and family members. The Company was essentially dormant from the date of formation, May 10, 2010, through the date when the unit sales occurred as part of the Company’s formation. As a result, the difference between the fair value of the shares and the cash received was not recorded as compensation expense. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The fair value of the common stock issuance to the founder using the Option-pricing Method to Allocation – Option Value by Capital Structure method is as follows:

-	3,000,000 shares of common stock valued at a total of $960, or $0.00032 per share, based on a 115% expected price volatility, estimated term of 12 months, risk-free interest rate of 0.29% and a dividends rate of 0%.

The total fair value of the warrant issuances to the founder using the Black-Scholes option-pricing model is as follows:

-	Warrants to purchase 1,000,000 shares of series A convertible preferred stock valued at a total of $890, or $0.00089 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $390.

-	Warrants to purchase 17,000,000 shares of common stock valued at a total of $3,910, or $0.00023 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $1,530.

-	1,000,000 shares of common stock issued to each of four Directors valued at $320 each, or $0.00032 per share, based on a 115% expected price volatility, estimated term of 12 months, risk-free interest rate of 0.29% and a dividends rate of 0%.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

Note 9 – Series A Convertible Preferred Stock Warrants

Series A Convertible Preferred Stock Warrants Granted

On June 21, 2010 the Company issued warrants to purchase 1,000,000 shares of series A convertible preferred stock at $0.001 per share over a ten year period from the date of issuance, in exchange for proceeds of $30 in conjunction with the sale of 3,000,000 shares of founder’s shares of common stock to the Company’s CEO. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The total fair value of the warrants using the Black-Scholes option-pricing model is $890, or $0.00089 per share, using the stated term, or ten years, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $390.

On June 21, 2010 the Company issued warrants to purchase 1,000,000 shares of series A convertible preferred stock at $0.001 per share over a ten year period from the date of issuance, in exchange for proceeds of $30 in conjunction with the sale of 3,000,000 shares of founder’s shares of common stock to the Company’s Chairman of the Board. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The total fair value of the warrants using the Black-Scholes option-pricing model is $890, or $0.00089 per share, using the stated term, or ten years, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $390.

Series A Preferred Stock Warrants Cancelled

No series A preferred stock warrants were cancelled during the three months ended March 31, 2013 and 2012.

Series A Preferred Stock Warrants Expired

No series A preferred stock warrants were expired during the three months ended March 31, 2013 and 2012.

Series A Preferred Stock Warrants Exercised

No series A preferred stock warrants were exercised during the three months ended March 31, 2013 and 2012.

The following is a summary of information about the Series A Preferred Stock Warrants outstanding at March 31, 2013.

Shares Underlying Warrants Outstanding

Shares Underlying Warrants Exercisable

Range of

Exercise

Underlying

Warrants

Weighted

Average

Remaining

Contractual

Weighted

Average

Exercise

Underlying

Warrants

Weighted

Average

Exercise

Prices

Outstanding

Life

Price

Exercisable

Price

0.001

2,000,000

7.2 years

0.001

2,000,000

0.001

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

The fair value of each warrant grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions used for grants under the fixed option plan:

	March 31,			December 31,
	2013			2012

Average risk-free interest rates		3.27	%		3.27	%
Average expected life (in years)		5.0			5.0

The Black-Scholes option pricing model was developed for use in estimating the fair value of short-term traded options that have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including expected stock price volatility. Because the Company’s series A preferred stock warrants have characteristics significantly different from those of traded options and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion the existing models do not necessarily provide a reliable single measure of the fair value of its series A preferred stock warrants. During the three months ended March 31, 2013 and 2012, there were no warrants granted with an exercise price below the fair value of the underlying stock at the grant date.

The weighted average fair value of warrants granted with exercise prices at the current fair value of the underlying stock during the period from May 10, 2010 (inception) to December 31, 2010 was approximately $0.001 per warrant, and there were no series A preferred stock warrants granted during the three months ended March 31, 2013 or the year ended December 31, 2012.

The following is a summary of activity of outstanding series A preferred stock warrants:

			Weighted
			Average
	Number of		Exercise
	Shares		Price

Balance, December 31, 2011		2,000,000	$	0.001
Warrants cancelled		-		-
Warrants granted		-		-
Warrants exercised		-		-
Balance, December 31, 2012		2,000,000	$	0.001
Warrants cancelled		-		-
Warrants granted		-		-
Warrants exercised		-		-
Balance, March 31, 2013		2,000,000	$	0.001

Exercisable, March 31, 2013		2,000,000	$	0.001

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

Note 10 – Common Stock Warrants

Common Stock Warrants Granted (2013)

On March 11, 2013, the Company sold warrants to purchase 10,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $5,000 in conjunction with the sale of 10,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On February 20, 2013, the Company sold warrants to purchase 5,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $2,500 in conjunction with the sale of 5,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On February 20, 2013, the Company sold warrants to purchase 20,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $10,000 in conjunction with the sale of 20,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On February 14, 2013, the Company sold warrants to purchase 60,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $30,000 in conjunction with the sale of 60,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On January 30, 2013, the Company sold warrants to purchase 15,000 shares of common stock at $0.75 per share over a one year period from the date of sale, in exchange for total proceeds of $7,500 in conjunction with the sale of 15,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

Common Stock Warrants Granted (2012)

On September 28, 2012, the Company granted common stock warrants to the Company’s CEO pursuant to the commencement of an employment agreement to purchase a total of 105,000 shares of common stock at $1.45 per share for his services as an Officer. The warrants carry a vesting period of 50% on January 15, 2013 and the remaining 50% vest on June 15, 2013. The option to exercise this warrant shall only be available if the Company’s common stock reaches a bid price of three dollars ($3.00) per share and remains at or above three dollars ($3.00) per share for thirty (30) consecutive trading days on any and all markets or exchanges which the Company’s common stock is traded (triggering event). The warrants are exercisable over seven (7) years after the triggering event. The fair value of the 105,000 common stock warrants using the Black-Scholes option-pricing model is $74,798, or $0.7315 per share, based on a volatility rate of 108%, a risk-free interest rate of 0.49% and an expected term of 3.76 years, and is being amortized over the implied service term, or vesting period, of the warrants.

On September 28, 2012, the Company granted common stock warrants to the Company’s Chairman of the Board of Directors pursuant to the commencement of an employment agreement to purchase a total of 105,000 shares of common stock at $1.45 per share for his services as the Chairman of the Board. The warrants carry a vesting period of 50% on January 15, 2013 and the remaining 50% vest on June 15, 2013. The option to exercise this warrant shall only be available if the Company’s common stock reaches a bid price of three dollars ($3.00) per share and remains at or above three dollars ($3.00) per share for thirty (30) consecutive trading days on any and all markets or exchanges which the Company’s common stock is traded (triggering event). The warrants are exercisable over seven (7) years after the triggering event. The fair value of the 105,000 common stock warrants using the Black-Scholes option-pricing model is $74,798, or $0.7315 per share, based on a volatility rate of 108%, a risk-free interest rate of 0.49% and an expected term of 3.76 years, and is being amortized over the implied service term, or vesting period, of the warrants.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

On September 28, 2012, the Company granted 70,000 common stock warrants to each of three Directors to purchase a total of 210,000 shares of common stock at $1.45 per share for services provided above and beyond their services as Directors. The warrants carry a vesting period of 50% on January 15, 2013 and the remaining 50% vest on June 15, 2013. The option to exercise this warrant shall only be available if the Company’s common stock reaches a bid price of three dollars ($3.00) per share and remains at or above three dollars ($3.00) per share for thirty (30) consecutive trading days on any and all markets or exchanges which the Company’s common stock is traded (triggering event). The warrants are exercisable over seven (7) years after the triggering event. In accordance with Accounting Standards Codification (“ASC”) 505-50, non-employee stock based compensation awards are re-measured at each period. The total fair value of the 210,000 common stock warrants using the Black-Scholes option-pricing model is $153,615, or $0.7315 per share as of September 30, 2012, based on a volatility rate of 108%, a risk-free interest rate of 0.49% and an expected term of 3.76 years.

On September 28, 2012, the Company granted common stock warrants to one of the Directors to purchase 70,000 shares of common stock at $1.45 per share for services provided above and beyond their services as Directors. The warrants carry a vesting period of 50% on January 15, 2013 and the remaining 50% vest on June 15, 2013. The option to exercise this warrant shall only be available if the Company’s common stock reaches a bid price of three dollars ($3.00) per share and remains at or above three dollars ($3.00) per share for thirty (30) consecutive trading days on any and all markets or exchanges which the Company’s common stock is traded (triggering event). The warrants are exercisable over seven (7) years after the triggering event. The total fair value of the 70,000 common stock warrants using the Black-Scholes option-pricing model is $49,865, or $0.7315 per share, based on a volatility rate of 108%, a risk-free interest rate of 0.49% and an expected term of 3.76 years, and is being amortized over the implied service term, or vesting period, of the warrants.

On August 9, 2012, the Company sold warrants to purchase 10,000 shares of common stock at $0.50 per share over a one year period from the date of sale, in exchange for total proceeds of $3,500 in conjunction with the sale of 10,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On August 9, 2012, the Company sold warrants to purchase another 10,000 shares of common stock at $0.50 per share over a one year period from the date of sale, in exchange for total proceeds of $3,500 in conjunction with the sale of 10,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On July 23, 2012, the Company sold warrants to purchase 3,000 shares of common stock at $0.50 per share over a one year period from the date of sale, in exchange for total proceeds of $1,050 in conjunction with the sale of 3,000 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On July 16, 2012, the Company sold warrants to purchase 14,285 shares of common stock at $0.50 per share over a one year period from the date of sale, in exchange for total proceeds of $5,000 in conjunction with the sale of 14,285 shares of common stock. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

On June 11, 2012 the Company sold warrants to purchase a total of 160,004 shares of common stock at $0.50 per share over a one year period from the date of sale, in exchange for total proceeds of $56,000 in conjunction with the sale of 160,004 shares of common stock to a total of seven independent investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

On June 8, 2012 the Company sold warrants to purchase 6,000 shares of common stock at $0.50 per share over a one year period from the date of sale, in exchange for proceeds of $2,100 in conjunction with the sale of 6,000 shares of common stock to an independent investor. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.

Common Stock Warrants Granted (2011)

On February 28, 2011, the Company granted warrants to purchase a total of 723,200 shares of common stock at $0.10 per share over a two year period from the date the Company begins trading on a public stock exchange, which occurred on August 1, 2012, in exchange for total proceeds of $72,320 in conjunction with the sale of 723,200 shares of common stock to a total of eighty five independent investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The total fair value of the 723,200 common stock warrants using the Black-Scholes option-pricing model is $1,121, or $0.00155 per share, based on a 105% volatility, risk-free interest rate of 3.27% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $506.

Common Stock Warrants Granted (2010)

On June 21, 2010, the Company issued warrants to purchase 17,000,000 shares of common stock at $0.00001 per share over a ten year period from the date of issuance, in exchange for proceeds of $30 in conjunction with the sale of 3,000,000 founder’s shares of common stock to the Company’s CEO. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The total fair value of the warrants using the Black-Scholes option-pricing model is $3,910, or $0.00023 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $1,530.

On June 21, 2010, the Company issued warrants to purchase 17,000,000 shares of common stock at $0.00001 per share over a ten year period from the date of issuance, in exchange for proceeds of $30 in conjunction with the sale of 3,000,000 founder’s shares of common stock to the Company’s Chairman of the Board. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The total fair value of the warrants using the Black-Scholes option-pricing model is $3,910, or $0.00023 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $1,530.

On June 21, 2010, the Company issued warrants to purchase 2,500,000 shares of common stock at $0.00001 per share over a ten year period from the date of issuance to the Company’s securities attorney, as an offering cost for the sale of a total of 10,000,000 founder’s shares of common stock to the Company’s Officers and Directors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis. The total fair value of the warrants using the Black-Scholes option-pricing model is $575, or $0.00023 per share, based on a 105% volatility, risk-free interest rate of 3.26% and a 25% discount due to lack of marketability. The intrinsic value of the warrants was $225. These warrants were subsequently amended on June 30, 2012 to be exercisable on a cashless basis. All other terms remain unchanged.

The Company recognized a total of $7,232, and $-0- of compensation expense during the three months ended March 31, 2013 and 2012, respectively, on common stock warrants issued to Employees and Directors that are being amortized over the implied service term, or vesting period, of the warrants. The remaining unamortized balance of these warrants is $512,793 as of March 31, 2013.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

In addition, the Company recognized a total of $2,496, and $-0- of compensation expense during the three months ended March 31, 2013 and 2012, respectively, on common stock warrants issued to Directors acting in their capacity as Non-Employees or Directors. In accordance with Accounting Standards Codification (“ASC”) 505-50, non-employee stock based compensation awards are re-measured each period; accordingly there is no unamortized balance of these warrants.

Common Stock Warrants Cancelled

No warrants were cancelled during the three months ended March 31, 2013 and 2012.

Common Stock Warrants Expired

No warrants expired during the three months ended March 31, 2013 and 2012.

Common Stock Warrants Exercised

On March 11, 2013, there were 10,000 common stock warrants exercised in exchange for proceeds of $1,000.

A total of 710,000 and -0- common stock warrants were exercised during the year ended December 31, 2012 and 2011, respectively. The exercises resulted in the issuance of a total of 709,990 shares of common stock, including 40,000 shares that were subsequently issued on October 16, 2012 and total proceeds of $46,000 during the year ended December 31, 2012.

The following is a summary of information about the Common Stock Warrants outstanding at March 31, 2013.

Shares Underlying Warrants Outstanding

Shares Underlying Warrants Exercisable

Range of

Exercise

Underlying

Warrants

Weighted

Average

Remaining

Contractual

Weighted

Average

Exercise

Underlying

Warrants

Weighted

Average

Exercise

Prices

Outstanding

Life

Price

Exercisable

Price

0.00001 – $1.45

39,786,489

7.06 years

0.1132

38,846,489

0.0808

	March 31,			December 31,
	2013			2012

Average risk-free interest rates		0.43	%		3.27	%
Average expected life (in years)		2.5			5.0

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

The Black-Scholes option pricing model was developed for use in estimating the fair value of short-term traded options that have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including expected stock price volatility. Because the Company’s common stock warrants have characteristics significantly different from those of traded options and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion the existing models do not necessarily provide a reliable single measure of the fair value of its common stock warrants. During the three months ended March 31, 2013 and 2012, there were no warrants granted with an exercise price below the fair value of the underlying stock at the grant date.

The weighted average fair value of warrants granted with exercise prices at the current fair value of the underlying stock during the period from May 10, 2010 (inception) to December 31, 2010 was approximately $0.00001 per warrant, and approximately $0.10 per warrant granted during the year ended December 31, 2011, the weighted average fair value of warrants granted during the year ended December 31, 2012 was $1.38 per warrant, and the weighted average fair value of warrants granted during the three months ended March 31, 2013 was $0.75 per warrant.

The following is a summary of activity of outstanding common stock warrants:

				Weighted
				Average
	Number of			Exercise
	Shares			Price

Balance, December 31, 2011		37,223,200		$	0.00195
Warrants cancelled		-			-
Warrants granted		3,183,289			1.38054
Warrants exercised		(720,000	)		(0.06528	)
Balance, December 31, 2012		39,686,489		$	0.11138
Warrants cancelled		-			-
Warrants granted		110,000			0.75
Warrants exercised		(10,000	)		(0.10	)
Balance, March 31, 2013		39,786,489		$	0.11315

Exercisable, March 31, 2013		38,846,489		$	0.08080

The Company recognized a total of $129,993 and $-0- of stock based compensation for the three months ended March 31, 2013 and 2012, respectively.

Premier Biomedical, Inc.

(A Development Stage Company)

Notes to Financial Statements

(Unaudited)

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 three months ended March 31, 2013 and the year ended December 31, 2012, 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 March 31, 2013 and December 31, 2012, the Company had $532,956 and $382,142 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:

	March 31,			December 31,
	2013			2012
Deferred tax assets:
Net operating loss carry forwards	$	186,535		$	129,370

Net deferred tax assets before valuation allowance	$	186,535		$	129,370
Less: Valuation allowance		(186,535	)		(129,370	)
Net deferred tax assets	$	-		$	-

Based on the available objective evidence, including the Company’s history of its loss, 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 March 31, 2013 and December 31, 2012, 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:

	March 31,			December 31,
	2013			2012

Federal and state statutory rate		35	%		35	%
Change in valuation allowance on deferred tax assets		(35	%)		(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

The Company has not conducted any reportable subsequent events through the date of the filing of this report.

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 are a research-based company that intends to discover and develop medical treatments for humans, specifically targeting the treatment of Alzheimer’s Disease (AD), Fibromyalgia, Multiple Sclerosis (MS), Traumatic Brain Injury (TBI), Amyotrophic Lateral Sclerosis (ALS/Lou Gehrig’s Disease), Blood Sepsis and Viremia, and Cancer.

We have not generated any revenue to date, and we do not currently have a product ready for market.

Going Concern

As a result of our financial condition, we have received a report from our independent registered public accounting firm for our financial statements for the period from May 10, 2010 (Inception) to December 31, 2012 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 begin to generate 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. At our current revenue and burn rate, our cash on hand will last approximately seven months. However, there is no assurance that our existing cash flow will be adequate to satisfy our existing operating expenses and capital requirements.

Results of operations for the three months ended March 31, 2013 and 2012:

	Three Months Ended
	March 31,						Increase /
	2013			2012			(Decrease)

Revenue	$	-		$	-		$	-

Operating expenses:
Research and development		83,679			-			83,679
General and administrative		2,318,400			9,503			2,308,897
Professional fees		230,431			17,429			213,002
Total operating expenses		2,632,510			26,932			2,605,578

Net operating loss		(2,632,510	)		(26,932	)		2,605,578
Other expense		(240	)		-			240

Net loss	$	(2,632,750	)	$	(26,932	)	$	2,605,818

Revenues:

The Company was established on May 10, 2010 and is in the development stage and had no revenues from the period from May 10, 2010 (inception) to March 31, 2013, as such there were no revenues.

Research and Development:

Research and development expenses were $83,679 for the three months ended March 31, 2013 compared to $-0- for the three months ended March 31, 2012, an increase of $83,679, or 100%. The increase was primarily due to research and development costs incurred during the three months ended March 31, 2013 related to the development of our patented technologies and research fees incurred with UTEP that were not incurred during the comparative three months ended March 31, 2012.

General and Administrative:

General and administrative expenses were $2,318,400 for the three months ended March 31, 2013 compared to $9,503 for the three months ended March 31, 2012, an increase of $2,308,897, or 24,297%. The increase was primarily due to stock based compensation costs of $2,315,000 from the excess fair value of a total of 3,000,000 shares of common stock sold amongst three Directors at a $0.05 per share purchase price incurred during the three months ended March 31, 2013 that were not incurred during the comparative three months ended March 31, 2012.

Professional Fees:

Professional fees expense was $230,431 for the three months ended March 31, 2013 compared to $17,429 for the three months ended March 31, 2012, an increase of $213,002, or 1,222%. The increase was primarily due to $166,443 of stock based compensation during the three months ended March 31, 2013, consisting of $129,993 of amortization of non-cash stock based compensation related to common stock warrants granted to Officers and Directors from September 28, 2012 through October 1, 2012 and $36,450 from the fair value of 50,000 shares of common stock granted on March 2, 2013 for consulting services, as well as approximately $34,000 of legal fees that were not incurred during the comparative three months ended March 31, 2012. A total of $105,762 of unamortized warrant costs as of March 31, 2013 remains unamortized and will be expensed over the implied service term, or vesting period, of the warrants.

Net Operating Loss:

Net operating loss for the three months ended March 31, 2013 was $2,632,510 or ($0.19) per share compared to a net operating loss of $26,932 for the three months ended March 31, 2012, or ($0.00) per share, an increase of $2,605,578 or 9,675%. Net operating loss increased primarily due to stock based compensation costs of $2,315,000 from the excess fair value of a total of 3,000,000 shares of common stock sold amongst three Directors at a $0.05 per share purchase price and $166,443 of non-cash stock based compensation related to common stock warrants granted to Officers and Directors, increased legal and consulting fees and increased research and development costs incurred as we increased our efforts to develop our patented technologies in the current year.

Other Expense:

Other expense for the three months ended March 31, 2013 was $240 compared to $-0- for the three months ended March 31, 2012, an increase of $240 or 100%. Other expense consisted solely of imputed interest expense on non-interest bearing debts owed to our Officers and Directors. The increase was primarily due to increased lending from our Officers and Directors that was outstanding during the three months ended March 31, 2013 compared to the three months ended March 31, 2012.

Net Loss:

Net loss for the three months ended March 31, 2013 was $2,632,750 or ($0.19) per share compared to a net loss of $26,932 for the three months ended March 31, 2012, or ($0.00) per share, an increase of $2,605,818 or 9,676%. Net loss increased primarily due to stock based compensation costs of $2,315,000 from the excess fair value of a total of 3,000,000 shares of common stock sold amongst three Directors at a $0.05 per share purchase price and $166,443 of non-cash stock based compensation related to common stock warrants granted to Officers and Directors, increased legal and consulting fees and increased research and development costs incurred as we increased our efforts to develop our patented technologies in the current year.

Liquidity and Capital Resources

Our cash, current assets, total assets, current liabilities, and total liabilities as of March 31, 2013 and December 31, 2012, respectively, are as follows:

	March 31,		December 31,
	2013		2012		Change

Cash	$	173,404	$	40,284	$	133,120
Total Current Assets		173,967		40,353		133,614
Total Assets		176,847		43,395		133,452
Total Current Liabilities		197,680		119,161		78,519
Total Liabilities	$	197,680	$	119,161	$	78,519

Our cash and total current assets increased because we were able to raise capital from the sale of our stock. Our total current liabilities increased primarily due to increased accounts payable. Our working capital deficit was $23,713 at March 31, 2013.

Cash Requirements

Although we had $173,404 in cash as of March 31, 2013, based on our lack of revenues, cash on hand and current monthly burn rate, around $24,000 per month, we will need to continue to raise capital from the sale of our stock and to borrow from our shareholders and other related parties to fund operations.

Sources and Uses of Cash

Operations

We had net cash used in operating activities of $(72,880) for the three months ended March 31, 2013, as compared to $(22,797) for the three months ended March 31, 2012. For the three months ended March 31, 2013, the net cash used in operating activities consisted primarily of our net loss of $(2,632,750), and increase in prepaid expenses of $(494), offset by non-cash adjustments to our net loss, including $162 of depreciation expense, $240 of imputed interest on related party loans, and $2,481,443 of stock based compensation, and an increase in accounts payable of $73,345. For the three months ended March 31, 2012, the net cash used in operating activities consisted primarily of our net loss of $(26,932), plus prepaid expenses of $(562) and offset by an increase in accounts payable of $4,697.

Investments

We didn’t have any cash flows from investing activities for the three month periods ended March 31, 2013 and March 31, 2012.

Financing

Our net cash provided by financing activities for the three months ended March 31, 2013 was $206,000, compared to $-0- for the three months ended March 31, 2012. For the three months ended March 31, 2013, our financing activities consisted of proceeds of $206,000 from the sale of common stock, including the exercise of warrants, of $1,000 and proceeds of $150,000 from stock sales to three of our Officers and Directors.

Debt Instruments, Guarantees, and Related Covenants

We have no disclosure required by this Item.

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 March 31, 2013, 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 March 31, 2013, 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.

Our principal executive officers do not expect that our disclosure controls or internal controls will prevent all error and all fraud. Although our disclosure controls and procedures were designed to provide reasonable assurance of achieving their objectives and our principal executive officers have determined that our disclosure controls and procedures are 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.

(d) 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 March 31, 2013, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1

Legal Proceedings

We are not 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

From January 9, 2013 to March 11, 2013, we issued 150,000 shares of our common stock to six investors, plus warrants to purchase an additional 150,000 shares of our common stock at a purchase price of $0.75 per share, for a period of one year, in exchange for cash consideration of $75,000. The issuances were exempt from registration pursuant to Rule 506 promulgated under Regulation D of the Securities Act of 1933. The investors were accredited and there was no solicitation in connection with the offering.

On February 20, 2013 and February 25, 2013, we sold an aggregate of 3,000,000 shares of our common stock, at a price of $0.05 per share, to three members of our Board of Directors as follows: Richard T. Najarian purchased 1,500,000 shares, John S. Borza purchased 1,000,000 shares, and Mitchell Felder purchased 500,000 shares, for total cash consideration of $150,000. The issuances were exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and all parties receiving shares of common stock were accredited investors because they are members of our Board of Directors.

On March 11, 2013, we issued 50,000 shares of our common stock to one individual for consulting services. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, the individual was either accredited or sophisticated and familiar with our operations, and there was no solicitation.

On March 11, 2013, pursuant to the exercise of warrants with one individual, we issued 10,000 shares of our common stock at $0.10 per share. The shares were registered in a Registration Statement on Form S-1, filed with the Securities and Exchange Commission and declared effective on December 13, 2011.

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

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

ITEM 6

Exhibits

(a) Exhibits

3.1 (1)		Articles of Incorporation of Premier Biomedical, Inc.

3.2 (1)		Bylaws of Premier Biomedical, Inc.

3.3 (1)		Certificate of Designation of Series A Convertible Preferred Stock

10.1 (2)		Form of Directors Stock Purchase Agreement

31.1		Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer

31.2		Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer

32.1		Chief Executive Officer Certification Pursuant to 18 USC, Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		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

(1)	Incorporated by reference from our Registration Statement on Form S-1 dated June 13, 2011, filed with the Commission on June 14, 2011.

(2)	Incorporated by reference from our Current Report on Form 8-K dated February 20, 2013, filed with the Commission on February 27, 2013.

XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

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: May 15, 2013		/s/ William A. Hartman
	By:	William A. Hartman
	Its:	Chief Executive Officer

PREMIER BIOMEDICAL INC - FORM 10-Q - May 15, 2013

Attached files

PREMIER BIOMEDICAL INC Reports