NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MARCH
31, 2022
(unaudited)
NOTE
1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General
American
Rebel Holdings, Inc. (the “Company”) operates primarily as a designer and marketer of branded safes and personal security,
self-defense products. Additionally, the Company designs and produces branded apparel and other accessories.
The
Company promotes and sells its products primarily through a growing network of dealers, in select regional retailers and local specialty
safe, sporting goods, hunting and firearms stores, as well as online, including its website and e-commerce platforms such as Amazon.com.
The
information on our website does not constitute a part of this report.
Listing
and reorganization
The
Company was incorporated on December
15, 2014, under the laws of the State of Nevada,
as CubeScape, Inc. The Company filed a registration statement on Form S-1, which was declared effective by the U.S. Securities and Exchange
Commission on October 14, 2015. Twenty-six (26) investors invested at a price of $0.80
per share for a total of $60,000.
The direct public offering closed on December 11, 2015.
On
January 5, 2017, the Company amended its articles of incorporation and changed its name to American Rebel Holdings, Inc. The Company
completed a business combination with its majority stockholder, American Rebel, Inc. on June 19, 2017. As a result, American Rebel, Inc.
became a wholly owned subsidiary of the Company.
The
aforementioned acquisition of American Rebel, Inc. was accounted for as a reverse merger, which involved issuance by the Company of 217,763
shares of its common stock and 6,250
warrants to purchase shares of common stock
to shareholders of American Rebel, Inc., and cancelled 112,500
shares of common stock previously owned
by American Rebel, Inc.
For
purposes of this Quarterly Report on Form 10-Q, “American Rebel” “we,” “our,” “us,” or
similar references refers to American Rebel Holdings. and its consolidated wholly-owned subsidiary, unless the context requires otherwise.
Interim
Financial Statements and Basis of Presentation
The
accompanying unaudited interim financial statements and related notes have been prepared in accordance with accounting principles generally
accepted in the United States of America (“U.S. GAAP”) for interim financial information, and with the rules and regulations
of the United States Securities and Exchange Commission (the “SEC”) set forth in Article 8 of Regulation S-X. Accordingly,
they do not include all of the information and footnotes required by the U.S. GAAP for complete financial statements. The unaudited interim
financial statements furnished reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management,
necessary to a fair statement of the results for the interim periods presented. Unaudited interim results are not necessarily indicative
of the results for the full fiscal year. These financial statements should be read along with the Annual Report filed on Form 10-K of
the Company for the period ended December 31, 2021 and notes thereto contained.
Principles
of Consolidation
The
Consolidated Financial Statements include the accounts of the Company and its majority-owned subsidiary, American Rebel, Inc., incorporated
in Nevada. All significant intercompany accounts and transactions have been eliminated.
Year
end
The
Company’s year-end is December 31.
Cash
and cash equivalents
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. The carrying value of these investments approximates fair value.
Inventory
and Inventory Deposits
Inventory
consists of backpacks, jackets, safes and accessories manufactured to our design and held for resale and are carried at the lower of
cost (First-in, First-out Method) or market value. The Company determines the estimate for the reserve for slow moving or obsolete inventories
by regularly evaluating individual inventory levels, projected sales and current economic conditions. The Company also makes deposit
payments on inventory to be manufactured that are carried separately until the goods are received into inventory.
Fixed
assets and depreciation
Property
and equipment are stated at cost net of accumulated depreciation. Additions and improvements are capitalized while ordinary maintenance
and repair expenditures are charged to expense as incurred. Depreciation is recorded by the straight-line method over the estimated useful
life of the asset, which ranges from five to seven years.
Revenue
recognition
In
accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), revenues are recognized when control of
the promised goods or services is transferred to our clients, in an amount that reflects the consideration to which we expect to be entitled
in exchange for those goods and services. To achieve this core principle, we apply the following five steps: (1) Identify the contract
with a client; (2) Identify the performance obligations in the contract; (3) Determine the transaction price; (4) Allocate the transaction
price to performance obligations in the contract; and (5) Recognize revenues when or as the company satisfies a performance obligation.
These steps are met when as order is received,
a price agreed, and the product shipped or delivered to that customer.
Advertising
costs
Advertising
costs are expensed as incurred; Marketing costs which we consider to be advertising costs incurred were $80,970
and $46,340
for the three-month periods ended March 31, 2022,
and 2021, respectively.
Fair
Value of Financial Instruments
Fair
value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of March
31, 2022, and December 31, 2021, respectively. The respective carrying value of certain on-balance-sheet financial instruments approximated
their fair values. These financial instruments include cash, and accounts payable. Fair values were assumed to approximate carrying values
for cash and payables because they are short term in nature and their carrying amounts approximate fair values or they are payable on
demand.
Level
1: The preferred inputs to valuation efforts are “quoted prices in active markets for identical assets or liabilities,” with
the caveat that the reporting entity must have access to that market. Information at this level is based on direct observations of transactions
involving the same assets and liabilities, not assumptions, and thus offers superior reliability. However, relatively few items, especially
physical assets, actually trade in active markets.
Level
2: FASB acknowledged that active markets for identical assets and liabilities are relatively uncommon and, even when they do exist, they
may be too thin to provide reliable information. To deal with this shortage of direct data, the board provided a second level of inputs
that can be applied in three situations.
Level
3: If inputs from levels 1 and 2 are not available, the Financial Accounting Standards Board (the “FASB”) acknowledges that
fair value measures of many assets and liabilities are less precise. The board describes Level 3 inputs as “unobservable,”
and limits their use by saying they “shall be used to measure fair value to the extent that observable inputs are not available.”
This category allows “for situations in which there is little, if any, market activity for the asset or liability at the measurement
date”. Earlier in the standard, FASB explains that “observable inputs” are gathered from sources other than the reporting
company and that they are expected to reflect assumptions made by market participants.
Stock-based
compensation
The
Company records stock-based compensation in accordance with the guidance in ASC Topic 505 and 718 which requires the Company to recognize
expense related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions
using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes
the cost of all share-based awards on a graded vesting basis over the vesting period of the award.
The
Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance
with FASB ASC 718-10 and the conclusions reached by the FASB ASC 505-50. Costs are measured at the estimated fair market value of the
consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value
of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment
or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.
Earnings
per share
The
Company follows ASC Topic 260 to account for earnings per share. Basic earnings per common share (“EPS”) calculations are
determined by dividing net income by the weighted average number of shares of common stock outstanding during the year. Diluted earnings
per common share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common
share equivalents outstanding. During periods when common stock equivalents, if any, are anti-dilutive they are not considered in the
computation.
Income
taxes
The
Company follows ASC Topic 740 for recording provision for income taxes. Deferred tax assets and liabilities are computed based upon the
difference between the financial statement and income tax basis of assets and liabilities using the enacted marginal tax rate applicable
when the related asset or liability is expected to be realized or settled. Deferred income tax expense or benefit is based on the changes
in the asset or liability for each period. If available evidence suggests that it is more likely than not that some portion or the entire
deferred tax asset will not be realized, a valuation allowance is required to reduce the deferred tax asset to the amount that is more
likely than not to be realized. Future changes in such valuation allowance are included in the provision for deferred income tax in the
period of change.
Deferred
income tax may arise from temporary differences resulting from income and expense items reported for financial accounting and tax purposes
in different periods. Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities
to which they relate. Deferred taxes arising from temporary differences that are not related to an asset or liability are classified
as current or non-current depending on the periods in which the temporary differences are expected to reverse.
The
Company applies a more-likely-than-not recognition threshold for all tax uncertainties. ASC Topic 740 only allows the recognition of
tax benefits that have a greater than fifty percent likelihood of being sustained upon examination by taxing authorities. As of March
31, 2022 and December 31, 2021, the Company reviewed its tax positions and determined there were no outstanding, or retroactive tax positions
with less than a 50% likelihood of being sustained upon examination by the taxing authorities, therefore this standard has not had a
material effect on the Company.
The
Company does not anticipate any significant changes to its total unrecognized tax benefits within the next 12 months.
The
Company classifies tax-related penalties and net interest as income tax expense. For the three-month period ended March 31, 2022, and
2021, respectively, no income tax expense has been recorded.
Use
of estimates
The
preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ
significantly from those estimates.
Right
of Use Assets and Lease Liabilities
In
February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The standard requires lessees to recognize almost all leases on the
balance sheet as a Right-of-Use (“ROU”) asset and a lease liability and requires leases to be classified as either an operating
or a finance type lease. The standard excludes leases of intangible assets or inventory. The standard became effective for the Company
beginning January 1, 2019. The Company adopted ASC 842 using the modified retrospective approach, by applying the new standard to all
leases existing at the date of initial application. Results and disclosure requirements for reporting periods beginning after January
1, 2019, are presented under ASC 842, while prior period amounts have not been adjusted and continue to be reported in accordance with
our historical accounting under ASC 840. The Company elected the package of practical expedients permitted under the standard, which
also allowed the Company to carry forward historical lease classifications. The Company also elected the practical expedient related
to treating lease and non-lease components as a single lease component for all equipment leases as well as electing a policy exclusion
permitting leases with an original lease term of less than one year to be excluded from the ROU assets and lease liabilities.
Under
ASC 842, the Company determines if an arrangement is a lease at inception. ROU assets and liabilities are recognized at commencement
date based on the present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments
that are fixed and determinable at the time of commencement. As most of the Company’s leases do not provide an implicit rate, the
Company estimated the incremental borrowing rate in determining the present value of lease payments. The ROU asset also includes any
lease payments made prior to commencement and is recorded net of any lease incentives received. The Company’ lease terms may include
options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options.
Operating
leases are included in operating lease Right-of-Use assets and operating lease liabilities, current and non-current, on the Company’s
consolidated balance sheets.
Recent
pronouncements
The
Company has implemented all new accounting pronouncements that are in effect and is evaluating any that may impact its financial statements.
The Company does not believe that there are any new accounting pronouncements that have been issued that might have a material impact
on its financial position or results of operations.
NOTE
2 – GOING CONCERN
The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the
recoverability of assets and the satisfaction of liabilities in the normal course of business. As noted above, the Company is in the
development stage and, accordingly, its revenue from its planned operations does not cover its operating expenses. Since inception, the
Company has been engaged in financing activities and executing its business plan of operations and incurring costs and expenses related
to developing products and market identity, obtaining inventory, preparing for public product launch and ultimately selling products.
As a result, the Company incurred net income (losses) for the three months ended March 31, 2022 and 2021 of ($2,628,237)
and ($927,615),
respectively. The Company’s accumulated deficit
was ($29,597,894)
as of March 31, 2022 and ($26,969,657)
as of December 31, 2021. The Company’s working capital was $4,775,936
as of March 31, 2022 compared to a
deficit of ($4,171,277)
as of December 31, 2021. The increase in working capital from December 31, 2021 to March 31, 2022 is due to the Company closing a
registered public offering in February 2022. In addition, the Company’s development activities since inception have been sustained
through equity and debt financing and the deferral of payments on accounts payable and other expenses.
The
ability of the Company to continue as a going concern is dependent upon its ability to raise capital from the sale of its equity and,
ultimately, the achievement of significant operating revenues. Management believes holders of its warrants will execute their
outstanding warrants generating additional investment capital for the Company. As of March 31, 2022, there were 700,838
warrants with an exercise price of $8.00
per share, and 3,287,123
warrants with an exercise price of $5.1875
per share.
Management is also in discussion with several investment banks and broker dealers regarding additional funding initiatives.
Management
believes sufficient funding can be secured through the obtaining of loans, as well as future offerings of its preferred and common stock
to institutional and other investors. However, no assurance can be given that the Company will obtain this additional working capital,
or if obtained, that such funding will not cause substantial dilution to its stockholders. If the Company is unable to secure such additional
funds from these sources, it may be forced to change or delay its business plan rollout.
These
financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts
and classification of liabilities that might result from this uncertainty.
NOTE
3 – INVENTORY AND DEPOSITS
Inventory
and deposits include the following:
SCHEDULE OF INVENTORY AND DEPOSITS
| |
March 31, 2022 (unaudited) | | |
December 31, 2021 (audited) | |
| |
| | |
| |
Inventory – Finished goods | |
$ | 643,495 | | |
$ | 685,854 | |
Inventory deposits | |
| 647,147 | | |
| - | |
Total Inventory and deposits | |
$ | 1,290,642 | | |
$ | 685,854 | |
NOTE
4 – PROPERTY AND EQUIPMENT
Property
and equipment include the following:
SCHEDULE
OF PROPERTY AND EQUIPMENT
| |
March 31, 2022 (unaudited) | | |
December 31, 2021 (audited) | |
| |
| | |
| |
Marketing equipment | |
$ | 32,261 | | |
$ | 32,261 | |
Vehicles | |
| 277,886 | | |
| 277,886 | |
Property and equipment gross | |
| 310,147 | | |
| 310,147 | |
Less: Accumulated depreciation | |
| (310,147 | ) | |
| (309,247 | ) |
Net property and equipment | |
$ | - | | |
$ | 900 | |
For
the three months ended March 31, 2022, and 2021 we recognized $900
and $1,613
in depreciation expense, respectively. We depreciate
these assets over a period of sixty (60) months which has been deemed their useful life. In January 2016 we acquired three vehicles from
related parties and assumed the debt secured by the vehicles as described at Note 7 – Notes Payable. Accordingly, the recorded
cost of each vehicle is the amount of debt assumed under each related loan, or a total of $277,886.
NOTE
5 – RELATED PARTY NOTE PAYABLE AND RELATED PARTY TRANSACTIONS
During
the year ended December 31, 2016, the Company acquired three vehicles from various related parties and assumed the debt secured by each
one of the vehicles. Accordingly, the recorded value for each vehicle is the total debt assumed under each related loan, or a total of
$277,886. (See Note 7 – Notes Payable.)
Charles
A. Ross, Jr. serves as the Company’s CEO. Compensation for Mr. Ross was $241,332
and $45,000,
respectively for the three months ended March 31, 2022, and 2021. Compensation for the three months ended March 31, 2022 includes
a bonus.
Doug
Grau serves as the Company’s President. Compensation for Mr. Grau was $150,000
and $30,000,
respectively for the three months ended March 31, 2022, and 2021. Compensation for the three months ended March 31, 2022 includes
a bonus.
NOTE
6 – NOTES PAYABLE – NON-RELATED PARTIES
Effective
January 1, 2016, the Company acquired three vehicles from various related parties in exchange for the assumption of the liabilities related
to those vehicles. The liabilities assumed are as follows at March 31, 2022 and December 31, 2021.
SCHEDULE
OF NOTES PAYABLE TO NON-RELATED PARTIES
| |
March 31, | | |
December 31, | |
| |
2022 | | |
2021 | |
| |
(unaudited) | | |
(audited) | |
| |
$ | 8,662 | | |
$ | 12,939 | |
Loan secured by a tour bus, monthly payments of $1,426 including interest at 12% per annum
through January 2023 when the remaining balance is payable. | |
$ | 8,662 | | |
$ | 12,939 | |
| |
| | | |
| | |
Total recorded as current liability | |
$ | 8,662 | | |
$ | 12,939 | |
Current
and long-term portion. Total loan balance is reported as current because loans are expected to be repaid within one year.
NOTE
7 – NOTES PAYABLE – WORKING CAPITAL
During
the three months ending March 31, 2022, the Company and the Company’s wholly owned operating subsidiary completed
the sale of additional short-term notes under similar terms in the additional principal amount totaling $60,000.
The notes are secured by a pledge of certain of the Company’s current inventory and the chief executive officer’s personal
guaranty.
During
the three months ending March 31, 2022, the Company and the Company’s wholly-owned operating subsidiary repaid
$2,541,634
and
completed the conversion of short term notes with a face value of $1,950,224
and accrued interest to shares of Common
Stock with a fair value of $2,803,632,
resulting in a Loss on Extinguishment of Debt of
$1,376,756.
As
of March 31, 2022, and December 31, 2021, the outstanding balance due on the working capital notes was $606,234
and $4,952,326,
respectively.
NOTE
8 – INCOME TAXES
At
March 31, 2022 and December 31, 2021, the Company had a net operating loss carryforward of $29,597,894
and $26,969,657,
respectively, which begins to expire in 2034.
Components
of net deferred tax asset, including a valuation allowance, are as follows:
SCHEDULE
OF DEFERRED TAX ASSETS AND LIABILITIES
| |
March 31, 2022 (unaudited) | | |
December 31, 2021 (audited) | |
Deferred tax asset: | |
| | | |
| | |
Net operating loss carryforward | |
$ | 6,215,558 | | |
$ | 5,663,628 | |
Total deferred tax asset | |
| 6,215,558 | | |
| 5,663,628 | |
Less: Valuation allowance | |
| (6,215,558 | ) | |
| (5,663,628 | ) |
Net deferred tax asset | |
$ | - | | |
$ | - | |
Valuation
allowance for deferred tax assets as of March 31, 2022, and December 31, 2021 was $6,215,558
and $5,663,628,
respectively. In assessing the recovery of the deferred tax asset, management considers whether it is more likely than not that some
portion or the entire deferred tax asset will not be realized. The ultimate realization of the deferred tax asset is dependent upon the
generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled
reversals of future deferred tax assets, projected future taxable income, and tax planning strategies in making this assessment. As
a result, management determined it was more likely than not deferred tax assets will not be realized as of March 31, 2022, and December
31, 2021, and recognized 100% valuation allowance for each period.
Reconciliation
between the statutory rate and the effective tax rate for both periods and as of December 31, 2021:
SCHEDULE
OF EFFECTIVE INCOME TAX RATE RECONCILIATION
| |
| | |
Federal statutory rate | |
| (21.0 | )% |
State taxes, net of federal benefit | |
| (0.0 | )% |
Change in valuation allowance | |
| 21.0 | % |
Effective tax rate | |
| 0.0 | % |
NOTE
9 – SHARE CAPITAL
The
Company is authorized to issue 600,000,000 shares of its $0.001 par value common stock and 10,000,000 shares of its $0.001 par value
preferred stock.
On February 7, 2022, the Company effectuated a
reverse split of its issued and outstanding shares of common stock at a ratio of 1-for-80. The share numbers and pricing information
in this quarterly report are adjusted to reflect the reverse stock split.
Common
stock
On
February 3, 2022, multiple Series B Convertible Preferred stockholders converted 201,358 shares of Series B Convertible Preferred Stock
to 251,698 shares of Common Stock of the Company.
On
February 3, 2022, the Company converted two outstanding notes into 186,067 shares of Common Stock of the Company.
On February 10, 2022 the Company received an equity
investment of $10,500,000 to purchase 2,530,121 shares of the Company’s common stock by a registered offering at $4.15 per share.
At
March 31, 2022 and December 31, 2021, there were 4,741,321
and 1,597,370
shares of common stock issued and outstanding,
respectively; and 75,143 and 276,501
shares of Series B preferred stock issued and
outstanding, respectively.
NOTE
10 – WARRANTS AND OPTIONS
As
of March 31, 2022, there were 4,365,446
warrants issued and outstanding. As of December
31, 2021, there were 701,776
warrants outstanding to acquire additional shares of common
stock.
The
Company evaluates outstanding warrants as derivative liabilities and will recognize any changes in the fair value through earnings. The
Company determined that the Warrants have an immaterial fair value at March 31, 2022. The warrants do not trade in a highly active securities
market, and as such, the Company estimated the fair value of these common stock equivalents using Black-Scholes and the following assumptions:
Expected
volatility was based primarily on historical volatility. Historical volatility was computed using daily pricing observations for recent
periods. The Company believes this method produced an estimate that was representative of the Company’s expectations of future
volatility over the expected term which due to their maturity period as expiry, it was three years. The Company had no reason to believe
future volatility over the expected remaining life of these common stock equivalents was likely to differ materially from historical
volatility. Expected life was based on three years due to the expiry of maturity. The risk-free rate was based on the U.S. Treasury rate
that corresponded to the expected term of the common stock equivalents.
SCHEDULE
OF FAIR VALUE MEASUREMENT
| |
March
31, 2022 (unaudited) | | |
December 31, 2021 (audited) | |
| |
| | |
| |
Stock Price | |
$ | 1.80 | | |
$ | 5.68 | |
Exercise Price | |
$ | 8.00 | | |
$ | 8.00 | |
Term (expected in years) | |
| 5.0 | | |
| 3.2 | |
Volatility | |
| 148.26 | % | |
| 203.44 | % |
Annual Rate of Dividends | |
| 0.0 | % | |
| 0.0 | % |
Risk Free Rate | |
| 2.32 | % | |
| 1.52 | % |
Stock
Purchase Warrants
The
following table summarizes all warrant activity for the year ended December 31, 2021, and the three months ended March 31, 2022.
SCHEDULE
OF WARRANT ACTIVITY
| |
Shares | | |
Weighted-Average Exercise Price Per Share | | |
Remaining term | | |
Intrinsic value | |
| |
| | |
| | |
| | |
| |
Outstanding and Exercisable at December 31, 2020 | |
| 43,688 | | |
$ | 20.80 | | |
| 3.48
years | | |
| - | |
Granted | |
| 662,713 | | |
$ | 8.00 | | |
| 2.95
years | | |
| - | |
Exercised | |
| | | |
| | | |
| - | | |
| - | |
Expired | |
| (4,625 | ) | |
| - | | |
| - | | |
| - | |
Outstanding and Exercisable at December 31, 2021 | |
| 701,776 | | |
$ | 8.80 | | |
| 2.95
years | | |
| - | |
Granted | |
| 2,909,639 | | |
$ | 5.1875 | | |
| 5.00
years | | |
| - | |
Granted in Debt Conversion | |
| 377,484 | | |
$ | 5.1875 | | |
| 5.00 years | | |
| | |
Granted Prefunded | |
| 377,484 | | |
$ | 0.01 | | |
| 5.00 years | | |
| | |
Exercised | |
| - | | |
| - | | |
| - | | |
| - | |
Expired | |
| (938 | ) | |
| - | | |
| - | | |
| - | |
Outstanding and Exercisable at March 31, 2022 | |
| 4,365,446 | | |
$ | 5.05 | | |
| 4.22
years | | |
| - | |
NOTE
11 – COMMITMENTS AND CONTINGENCIES
Rental
Payments under Non-cancelable Operating Leases
The
Company has a lease for a sales office and showroom in Lenexa, Kansas which expires in January 2026, and an annually renewable lease
for manufacturing and warehouse space in Chanute, Kansas. The following is a schedule, by year, of the future minimum rental payments
under the lease:
SCHEDULE
OF FUTURE MINIMUM RENTAL PAYMENTS FOR OPERATING LEASE
Year ended December 31, | |
| |
| |
| |
2022 | |
| 169,096 | |
2023 | |
| 76,628 | |
2024 | |
| 77,681 | |
2025 | |
| 78,755 | |
2026 | |
| 19,689 | |
Total | |
$ | 421,848 | |
Rent
expense totaled approximately $35,615
and $35,615
for three-month periods ended March 31, 2022,
and 2021, respectively.
NOTE
12 – SUBSEQUENT EVENTS
The
Company evaluated all events that occurred after the balance sheet date of March 31, 2022, through the date the financial statements
were issued and determined that there were the following subsequent events:
On April 6, 2022, the Company entered into a two-year lease agreement
for approximately 1,750 square feet of office space in Nashville, TN, at a cost of $4,750 per month.
FORWARD
LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (“Quarterly
Report”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities
Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking
statements are not historical facts but rather are based on current expectations, estimates and projections. We may use words such as
“may,” “could,” “should,” “anticipate,” “expect,” “project,”
“position,” “intend,” “target,” “plan,” “seek,” “believe,” “foresee,”
“outlook,” “estimate” and variations of these words and similar expressions to identify forward-looking statements.
These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of
which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted.
These risks and uncertainties include, but are not limited to, the following:
|
● |
we currently do not
own a manufacturing facility, and future acquisition and operation of new manufacturing facilities might prove unsuccessful and could
fail; |
|
|
|
|
● |
our success depends
on our ability to introduce new products that track customer preferences; |
|
|
|
|
● |
if we are unable to
protect our intellectual property, we may lose a competitive advantage or incur substantial litigation costs to protect our rights; |
|
|
|
|
● |
as significant portion
of our revenues is derived by demand for our safes and personal security products for firearms storage purposes, we depend on the
availability and regulation of ammunition storage; |
|
|
|
|
● |
as we rely on third-party
manufacturers for our safes production, our compromised operational capacity may affect our ability to meet the demand for our safes,
which in turn may affect our generation of revenue; |
|
|
|
|
● |
shortages of components
and materials, as well as supply chain disruptions, may delay or reduce our sales and increase our costs, thereby harming our results
of operations; |
|
|
|
|
● |
we do not have long-term
purchase commitments from our customers, and their ability to cancel, reduce, or delay orders could reduce our revenue and increase
our costs; |
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our inability to effectively
meet our short- and long-term obligations; |
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given our limited corporate
history it is difficult to evaluate our business and future prospects and increases the risks associated with an investment in our
securities; |
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our inability to raise
additional financing for working capital; |
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our ability to generate
sufficient revenue in our targeted markets to support operations; |
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significant dilution
resulting from our financing activities; |
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the actions and initiatives
taken by both current and potential competitors; |
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our ability to diversify
our operations; |
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the fact that our accounting
policies and methods are fundamental to how we report our financial condition and results of operations, and they may require management
to make estimates about matters that are inherently uncertain; |
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changes in U.S. GAAP
or in the legal, regulatory and legislative environments in the markets in which we operate; |
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the deterioration in
general or global economic, market and political conditions; |
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the inability to efficiently
manage our operations; |
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the inability to achieve
future operating results; |
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the unavailability of
funds for capital expenditures; |
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the inability of management
to effectively implement our strategies and business plans; and |
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the other risks and
uncertainties detailed in this report. |
Because the factors referred to above could cause
actual results or outcomes to differ materially from those expressed in any forward-looking statements made by us, you should not place
undue reliance on any such forward-looking statements. New factors emerge from time to time, and their emergence is impossible for us
to predict. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination
of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
This Quarterly Report should be read completely and
with the understanding that actual future results may be materially different from what we expect. The forward-looking statements included
in this Quarterly Report are made as of the date of this Quarterly Report and should be evaluated with consideration of any changes occurring
after the date of this Quarterly Report. We will not update forward-looking statements even though our situation may change in the future
and we assume no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Except as otherwise indicated by the context, references
in this report to “Company,” “American Rebel Holdings,” “American Rebel,” “we,” “us”
and “our” are references to American Rebel Holdings, Inc. and its wholly-owned operating subsidiary, American Rebel, Inc.
All references to “USD” or United States Dollar refer to the legal currency of the United States of America.