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10-K

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FORM 10-K ANNUAL REPORT

Form 10-K Annual Report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2020

[ ] 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 000-55728

AMERICAN REBEL HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (833) 267-3235

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, $0.001 par value

(Title of Class)

Copies of communications to:

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes [ ] No [X]

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

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.Yes [X] No [ ]

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

[ ] Large accelerated filer [ ] Accelerated filer

[X] Non-accelerated filer [X] Smaller reporting company

[X] Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act). Yes [ ] No [X]

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by the price at which common equity was last sold: $2,940,998.74 as of June 30, 2020.

The number of shares of the registrant’s common stock outstanding as of May 5, 2021 was 79,466,563 shares.

Documents incorporated by reference: None

AMERICAN REBEL HOLDINGS, INC.

TABLE OF CONTENTS

PART II

ITEM 1. Business 6

ITEM 1A. Risk Factors 14

ITEM 1B. Unresolved Staff Comments 27

ITEM 2. Properties 27

ITEM 3. Legal Proceedings 28

ITEM 4. Mine Safety Disclosures 28

PART II

ITEM 6. Selected Financial Data 31

ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 35

ITEM 8. Financial Statements and Supplementary Data 35

ITEM 9A. Controls and Procedures 36

ITEM 9B. Other Information 37

PART III

ITEM 10. Directors, Executive Officers and Corporate Governance 38

ITEM 11. Executive Compensation 42

ITEM 14. Principal Accountant Fees and Services 48

PART IV

ITEM 15. Exhibits and Financial Statement Schedules 49

SIGNATURES 53

FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K (“Annual 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 “anticipate,” “expect,” “intend,” “plan,” “believe,” “foresee,” “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 the following:

·the risks and other factors described under the caption “Risk Factors” under Item 1A of this Annual Report on Form 10-K;

·our ability to efficiently manage and repay our debt obligations;

·our future operating results;

·our inability to raise additional financing for working capital, especially related to purchasing critical inventory;

·our ability to generate sufficient revenue in our targeted markets to support operations

·significant dilution resulting from our financing activities:

·actions and initiatives taken by both current and potential competitors;

·supply chain disruptions for components used in our products;

·manufacturers inability to deliver components or products on time;

·our ability to diversify our operations;

·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;

·adverse state or federal legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations;

·changes in U.S. GAAP or in the legal, regulatory and legislative environments in the markets in which we operate;

·deterioration in general or global economic, market and political conditions;

·inability to efficiently manage our operations;

·inability to achieve future operating results;

·the unavailability of funds for capital expenditures;

·our ability to recruit and hire key employees;

·the global impact of COVID-19 on the United States economy and our operations;

·the inability of management to effectively implement our strategies and business plans;

·our business prospects;

·any contractual arrangements and relationships with third parties;

·the dependence of our future success on the general economy;

·any possible financings; and

·the adequacy of our cash resources and working capital.

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 Annual 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 Annual Report are made as of the date of this Annual Report and should be evaluated with consideration of any changes occurring after the date of this Annual 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.

AVAILABLE INFORMATION

We file annual, quarterly and special reports and other information with the SEC. You can read these SEC filings and reports over the Internet at the SEC’s website at www.sec.gov. You can also obtain copies of the documents at prescribed rates by writing to the Public Reference Section of the SEC at 100 F Street, NE, Washington, DC 20549 on official business days between the hours of 10:00 am and 3:00 pm. Please call the SEC at (800) SEC-0330 for further information on the operations of the public reference facilities. We will provide a copy of our annual report to security holders, including audited financial statements, at no charge upon receipt to of a written request to us at American Rebel Holdings, Inc., 718 Thompson Lane, Suite 108-199, Nashville, Tennessee 37204.

PART I

ITEM 1. BUSINESS

DESCRIPTION OF BUSINESS

Corporate Summary

American Rebel Holdings, Inc. was incorporated on December 15, 2014 in the State of Nevada and is authorized to issue 100,000,000 shares of Common Stock and 1,000,000 shares of Preferred Stock of $0.001 par value.

American Rebel is boldly positioning itself as “America’s Patriotic Brand” in a time when national spirit and American values are being rekindled and redefined. American Rebel is an advocate for the 2nd Amendment and conveys a sense of responsibility to teach and preach good common practices of gun ownership. American Rebel products keep you concealed and safe inside and outside the home. American Rebel Safes protect your firearms and valuables from children, theft, fire and natural disasters inside the home; and American Rebel Concealed Carry Products provide quick and easy access to your firearm utilizing American Rebel’s Proprietary Protection Pocket in its backpacks and apparel outside the home. The initial company product releases embrace the “concealed carry lifestyle” with a focus on concealed carry products, apparel, personal security and defense. “There’s a growing need to know how to protect yourself, your family, your neighbors or even a room full of total strangers,” says American Rebel’s CEO, Andy Ross. “That need is in the forethought of every product we design”

The “concealed carry lifestyle” refers to a set of products and a set of ideas around the emotional decision to carry a gun everywhere you go. The American Rebel brand strategy is similar to the successful Harley-Davidson Motorcycle philosophy, referenced in this quote from Richard F. Teerlink, Harley’s chairman and former chief executive, “It’s not hardware; it is a lifestyle, an emotional attachment. That’s what we have to keep marketing to.” As an American icon, Harley has come to symbolize freedom, rugged individualism, excitement and a sense of “bad boy rebellion.” American Rebel – America’s Patriotic Brand has significant potential for branded products as a lifestyle brand. Its innovative Concealed Carry Product line and Safe line serve a large and growing market segment; but it is important to note we have product opportunities beyond Concealed Carry Products and Safes.

We were initially incorporated under the laws of the State of Nevada on December 15, 2014 under the name CubeScape, Inc. On or about June 8, 2016, a change in control occurred with us pursuant to the terms of a Securities Purchase Agreement by and among us, David Estus, our then sole officer, director and majority stockholder and American Rebel, Inc., a Nevada corporation (“ARI”). Pursuant to the terms of the agreement, Estus, who owned 9,000,000 shares of our common stock representing 60% of our issued and outstanding common stock, sold such shares to ARI for aggregate consideration of $35,000, or approximately $0.00389 per share. In addition, certain stockholders of ARI purchased 6,000,000 shares of our common stock in a series of private transactions from nonaffiliates. Effective December 23, 2016 we changed our name to American Rebel Holdings, Inc.

On June 19, 2017, we entered into an Amended Stock Purchase and Reorganization Agreement with ARI and its former stockholders, whereby we acquired 100% of the outstanding common shares of ARI in exchange for the issuance of 17,421,000 shares of our common stock and warrants to purchase 500,000 shares of common stock at $0.50 per share. In addition, we cancelled the 9,000,000 shares of our common stock issued to ARI as part of the change of control transaction described above. Following the acquisition, there were approximately 23,421,000 shares of our common stock issued and outstanding, with pre-acquisition stockholders holding 6,000,000 shares of our common stock (held by some former ARI stockholders who acquired these shares in private transactions) and former ARI stockholders holding 17,421,000 shares of our common stock directly or 74.4% of our issued and outstanding equity.

After giving effect to this transaction, we commenced operations through ARI as our wholly-owned subsidiary.

American Rebel, Inc. was incorporated on December 15, 2014 in the state of Nevada and is a natural evolution of the vision of its founder and CEO Charles A. “Andy” Ross, Jr. Mr. Ross is a natural entrepreneur having successfully designed and delivered a new line of law enforcement/security products to market during his tenure as CEO of Digital Ally, a company he founded in 2004. Digital Ally successfully accessed the public market as a public company and Digital Ally continues to trade on the NASDAQ stock exchange. Andy also founded Ross Archery in 2006 and hosted an innovative television show called Maximum Archery that aired on the Outdoor Channel, Sportsman Channel, and the Pursuit Channel.

The roots of American Rebel trace back to a song written and recorded by Andy Ross in response to the ongoing gun rights debate. Andy was completing his second CD and the dialog on television and online was suggesting that severe restrictions were needed in the right to bear arms. Andy reached out to his collaborators and wrote the song “Cold Dead Hand.” “Cold Dead Hand” harkens back to the iconic Charlton Heston public appearance where Charlton holds a rifle high over his head and proclaims, “Out of my cold dead hand....” This phrase has been a rallying cry for gun rights supporters ever since; but never has it been incorporated into such an effective song. Andy renamed his second CD Cold Dead Hand and the song was released nationally to country music radio stations. The song received significant airplay and an accompanying video to the song received hundreds of thousands of views. In addition to the country music radio station airplay, many talk radio stations picked up the song and promoted it as a 2nd Amendment anthem. Andy continues to conduct interviews on music and talk radio stations about the song and the gun rights debate.

It was the song “Cold Dead Hand” that inspired Danny “the Count” Koker to reach out to Andy to create the 2nd Amendment Muscle Car for his highly-rated Counting Cars television program on the History Channel. The story behind the creation, building, and presentation of the car to Andy is captured in the episode Rocked and Loaded which originally aired February 25, 2014 and continues to re-air and has appeared as a part of “best of” compilations of the show’s episodes. The enduring popularity of the 2nd Amendment Muscle Car was evidenced by the excitement shown by 2017 NRA Convention attendees when they reviewed the car in the American Rebel booth. In fact, the car is so popular that the Company is planning several collectible die-cast models of the car.

“Cold Dead Hand” placed Andy Ross directly in the public and political debate over gun rights and the right to bear arms as codified in the 2nd Amendment to the US Constitution. As Andy participated in the debate, he realized there was a market opportunity to provide innovative and effective designs for everyday use items that assisted the desire of customers to be concealed and safe during their normal course of everyday duties. The beginnings of American Rebel were starting to take shape and because Andy Ross’s music plays such an important part in the American Rebel story, it is helpful to trace the beginnings of Andy Ross’s music career.

After the airing of the Counting Cars episode that featured the building and presenting of the 2nd Amendment Muscle Car to Andy and the accompanying exposure from “Cold Dead Hand,” Andy began to imagine a product that would be perfect for everyday use while keeping the user concealed and safe. Range bags, bags and packs that were designed to carry firearms and ammo to the range, were on the market; but they weren’t versatile enough to satisfy everyday needs. These range bags were just that, range bags. Andy imagined a backpack that had designed areas to carry a laptop or tablet, a phone, sunglasses, files and important papers, chargers for electronics, anything needed in the normal course of the day, and an isolated patent-pending Protection Pocket that could effectively carry most handguns. The patent-pending Protection Pocket utilizes a sandwich method which holds the handgun in place and is accessed by a zipper on either side of the rear bottom of the backpack. If a user of one of Andy’s backpacks needed to get to their firearm, they could rest easy knowing the gun was in place and they could access it easily and quickly.

During the same time period Andy was beginning the design of the concealed carry backpack, Andy was writing a new opener song for his television show. He wanted the television show to expand beyond a show exclusively about archery, to be a show that could feature tactical shooting and personal safety information as well as continue to cover his passion for hunting. He wanted the show to include hunts with firearms in addition to hunts with his bow. Andy wrote and recorded “American Rebel” to be the new opener for his new show and the response to the new song and the new show was extremely positive. As the new show aired and Andy performed “American Rebel” during his musical appearances, a trusted business consultant suggested to Andy that his new company should be called American Rebel. Andy agreed that American Rebel captured the spirit of what his new company was about.

With the features and benefits of the American Rebel backpack identified, Andy set out to create the specific design of the American Rebel Concealed Carry Backpack. A supplier was selected and samples were created and evaluated. These samples were tested, changes were proposed and new samples created and tested. Response to the Extra-Large Double Compartment Backpack was very positive and the information gathered was incorporated into the final designs of the American Rebel Concealed Carry Backpacks. The patent-pending Protection Pocket utilizes a sandwich method which holds the handgun in place and is accessed by a zipper on either side of the rear bottom of the backpack. If a user of one of Andy’s backpacks needed to get to their firearm, they could rest easy knowing the gun was in place and they could access it easily and quickly.

The firearms and gun ownership market within the U.S.A continues to grow with no sign of decline. Since 2010, the market for new gun purchases has increased by 60%, and at the end of 2020, it has been estimated that there will be over 400 million guns in the US. There were 39,695,315 background checks through the National Instant Criminal Background Check System (NICS) in 2020, a 40% increase from the previous annual record for background checks in 2019. And 2021 shows no sign of slowing down evidenced by the 4,317,804 background checks for the month of January, a nearly 10% increase from the previous month’s monthly record.

Interest in gun ownership and tactical/concealed carry clothing, backpacks and accessories is exploding. A current market leader in the tactical products category has grown its revenue from $80 million in 2007 to $200 million in 2011 to $400 million in 2015. This is a strong heartbeat for gun rights, gun ownership, tactical/concealed-carry products and enhances our opportunity to build the American Rebel brand.

The initial product offering introduced at the 2017 NRA show in Atlanta, GA includes four sizes and styles of concealed carry backpacks with a variety of available colors (25 SKUs), which include the Company’s patent-pending Protection Pocket and two styles of men’s overcoats. Products additionally released through 2018 and 2019 have included additional concealed carry jackets for men and women.

The addition of Nathan Findley to the American Rebel team presented an opportunity for American Rebel to launch American Rebel Safes in 2019. Nathan’s many years of experience with Liberty Safe and 9g Products are key assets for American Rebel to engineer, design, and manufacture its own line of gun safes and security products. American Rebel has the right products, marketing, and brand to capitalize on the unmet needs and opportunities identified by its CEO Andy Ross and the American Rebel Executive Team.

The Company will also pursue strategic alliances with other companies for goods and services that supplement or complement the internally developed products. These products may be in the personal protection category, or may be everyday products that embody the reliable, competent and confident spirit of the American Rebel brand.

To maintain quality, low cost of goods, and continuity of inventory American Rebel is pursuing strategic manufacturing alliances across the globe. Apparel labor costs in Mexico are almost equal to China, and offer quick response with lower transportation costs for smaller production runs. Additionally the impact of tariffs has transformed sourcing of goods and American Rebel seeks to be on the forefront of a reinvigorated United States manufacturing sector.

An early stage company such as American Rebel faces many risks that can impede its execution of its business plan. These risks include:

Undercapitalization: The Company is currently undercapitalized and intends to pursue the additional capital required to execute its business plan. Economic conditions beyond the Company’s control can change investor interest, and competitive entries could impact the probability of success.

Legislative and Government Intervention: The current legislative trends are favorable to the 2ndAmendment and personal protection, but a political movement, public opinion, or an unforeseen event could change the legislative’s stance, and restrict concealed-carry goods, negatively impacting sales. In addition, changes to international trade agreements and government imposed tariffs could impact prices, margins, and continuity of supply.

Personal Protection: The Company’s intended focus on the broader personal protection market could insulate the Company to some degree, or not. In addition, any trade agreements changes would impact most all competitors equally.

Key Man: Andy Ross has an established public personality and is currently instrumental to the Company. American Rebel intends to establish additional “faces” of the Company that will complement Andy Ross’s contributions.

Security: As an Internet-based retailer the Company will be subject to the risks all online retailers face. The Company employs third-party services for credit card transactions, and as operations continue the Company will continually harden its online assets and deploy additional layers of protection for its customers, its assets, and its continued operations.

Product Acceptance: Fashion trends, competitive entries, and pricing can negatively impact the brand with little to no warning and with few immediate cures. Focus groups, one-on-one interviews, and test marketing suggest that the product is attractive and sellable, the brand is adaptable, and it represents a brand ego that generates self-confidence in its patrons.

ERM: The current staffing and board participation is minimal, as such, until funding is complete there is no formal Enterprise Risk Management process in place.

Additional expertise and processes will be added as funding occurs and key outside board additions have been identified to add competence in governance, compliance, and audit.

American Rebel Safes

American Rebel Safes are a product of Nathan Findley’s years of experience engineering and designing gun safes at Liberty Safe and 9g Products combined with American Rebel style and innovation. Keeping your guns in a location only appropriate trusted members of the household can access should be one of the top priorities for every responsible gun owner. Whenever a new firearm is purchased, the owner should also look for a way to store and secure it. Storing the firearm in a gun safe will prevent it from being misused by young household members, and it will also prevent it from being stolen in a burglary or damaged in a fire or natural disaster. Gun safes may seem pricy at first glance, but once the consumer is educated on their role to protect expensive firearms and other valuables such as jewelry and important documents, the price is justified.

American Rebel produces large floor safes in a variety of sizes as well as small portable keyed safes. Additional opportunities exist for the Company to develop Wall Safes and Handgun Boxes.

Reasons gun owners should own a gun safe:

·If you are a gun owner and you have children, many states have a law in place that you have to have your gun locked in a safe away from children. This will prevent your children from getting the gun and hurting themselves or someone else.

·Some states have a law in place that you have to keep your gun locked away when it is not in use even if you don’t have children in your home. California has a law that you have to have your gun locked away by a firearms safety device that is considered safe by the California Department of Justice (DOJ). When you buy a safe, you should see if it has approval from the California DOJ.

·Many gun owners own more guns than insurance will cover. Many insurance companies only cover $3,000 worth of guns. Are your weapons worth more? If so, you should invest in a gun safe to make sure your guns are protected from fire, water, and thieves.

·Many insurance companies will give you a discount if you own a gun safe. If you own a gun safe or you purchase one, you should see if your insurance company is one that offers a discount for this. A safe can protect your guns and possibly save you money.

·Do people know you own guns? You might not know that many burglaries are carried out by people they know.

·If a person you know breaks into your home, steals your gun, and murders someone you could be charged with a crime you didn’t commit or the victim’s family could sue you.

·Gun safes can protect your guns in the event your home goes up in flames. When buying a safe, you should see if it will protect your firearm or any other valuables from fire damage.

·You might be the type of person that has a gun in your home for protection. A gun locked in a safe can still offer you protection. There are quick access gun safes on the market. With a quick access gun safe, you can still retrieve your gun in a few seconds but when it isn’t needed it will be protected.

A gun safe is the best investment a gun owner can make because the safe can protect guns from thieves, fire, water, or accidents. This year, bills or ballot measures to require safe storage have been proposed in Delaware, Washington, Oregon, Missouri and Virginia; and various laws are on the books in California and Massachusetts. Even a figure as staunchly pro-gun as Texas’s Republican lieutenant governor, Dan Patrick, called on gun-owning parents to lock up their weapons after the Santa Fe shooting. The gun safe industry is experiencing rapid growth and innovation. American Rebel CEO Andy Ross, Nathan Findley and the rest of the American Rebel team are committed to fulfilling the opportunity in the gun safe market and filling the identified void with American Rebel Gun Safes.

Licensing

Management believes the American Rebel brand name may have significant licensing value to third parties that seek the American Rebel name to brand their products to market to the American Rebel target demographic. For example, a tool manufacturer that markets a line of tools under their own brand but wants to pursue an alternative marketing plan that might have a different look and feel could license the American Rebel brand name for their line of tools and market their tools under two distinct brands. The licensee would benefit from the strong American Rebel brand with their second line of tools as they would continue to sell both the line of tools under their brand and the line of tools under the American Rebel brand. Because of the strong brand identity of the American Rebel brand, the Company would generate licensing income created primarily by the marketing done to sell Company-owned American Rebel products in the marketplace.

American Rebel and the National Rifle Association (NRA) have entered into an agreement for American Rebel to design and create NRA branded products. Management anticipates these NRA branded products to be available for purchase in the second half of 2021.

Conversely, American Rebel can also benefit as a licensee of unique products. If American Rebel determines a third party has designed, engineered, and manufactured a product that would be a strong addition to the American Rebel catalog of products, American Rebel can license that product from the third party and sell the licensed product under the American Rebel brand.

The key to successful licensing either as the licensee or licensor is a successful brand. By introducing American Rebel to the market with innovative concealed carry and gun safe products and by aggressively marketing the American Rebel brand, the Company has laid a solid foundation for future licensing income.

The Company maintains its warehouse and shipping operations at 3800 S Ross Lane, Chanute, KS 66720; but utilizes 718 Thompson Lane, Suite 108-199, Nashville, TN, 37204 as its primary address. The company has a sales office at 8460 Nieman Road, Lenexa, Kansas 66214. The lease agreement at 8460 Nieman Road, Lenexa, Kansas 66214 is in the name of American Rebel, Inc. and the lease agreement at 3800 S Ross Lane, Chanute, Kansas 66720, is in the name of American Rebel Holdings, Inc. The wholly-owned subsidiary American Rebel, Inc. maintains 718 Thompson Lane, Suite 108-199, Nashville, TN address. Our website address is www.americanrebel.com. The information on our website is not part of this Current Report, Form 10-K.

Description of Business

Company Overview

American Rebel is boldly positioning itself as America’s Patriotic Brand. The Company has identified the market opportunity to design, manufacture, and market innovative concealed carry products. American Rebel accesses its market uniquely through its positioning as America’s Patriotic Brand and the appeal of its products as well as through the profile and public persona of its founder and CEO Andy Ross. Andy has hosted his own television show for 12 years, has made multiple appearances over the years at trade shows, and is well-known in the archery world as the founder of Ross Archery, which was the world’s fastest growing bow company in 2007 and 2008. Andy has also released 3 CDs, done numerous radio and print interviews, and performed many concerts in front of thousands of people. Andy has the ability to present American Rebel to large numbers of potential customers through the appeal of his music and other supporting appearances. For example, his appearance on the History Channel hit show Counting Cars in February 2014 has been viewed by over 2 million people. Bringing innovative products that satisfy an existing demand to the market through exciting means is the American Rebel blueprint for success.

Market Overview

The Concealed Carry product market is estimated at over $1 billion in annual sales; but American Rebel’s market not only includes current consumers of concealed carry products but also includes anyone that has ever considered concealing and carrying a weapon. To many the Company’s products solve the problem of how to safely and responsibly carry a weapon. If they had our backpack, jacket or coat, they would then conceal and carry a gun.

The US firearms and gun ownership market continues to grow with no sign of abatement. Since 2010, the market for new gun purchases has increased by 60%, and by the end of 2020, there will be over 400 million guns in the US. There were 39,695,315 background checks through the National Instant Criminal Background Check System (NICS) in 2020, a 40% increase from the previous annual record for background checks in 2019. And 2021 shows no sign of slowing down evidenced by the 4,317,804 background checks for the month of January, a nearly 10% increase from the previous month’s monthly record.

Interest in gun ownership and tactical/concealed carry clothing, backpacks and accessories is exploding. A current market leader in the tactical products category has grown its revenue from $80 million in 2007 to $200 million in 2011 to $400 million in 2015. This all sends a strong signal for gun rights, gun ownership, tactical/concealed carry products, and our American Rebel brand.

The obvious customer base for American Rebel Concealed Carry products would be any customer that conceals a handgun and any concealed carry permit holders; but we believe the market is much larger than that. Interviews of potential customers have revealed that our customer base would include any person who has thought they might one day want to conceal and carry a firearm and the availability of the American Rebel product will initiate their taking action on their desire to conceal and carry a firearm. These potential customers aren’t comfortable carrying a firearm holstered on their hip and they haven’t been introduced to a product that conceals the firearm properly, allows easy access to the firearm, and also provides everyday value for their daily routine.

The Rise of The 'Concealed-Carry Lifestyle'

The "concealed-carry lifestyle" refers to a set of products and a set of ideas around the decision to carry a gun everywhere you go.

The concealed-carry movement is central to the gun-rights platform of organizations like the National Rifle Association. "The idea that you should be allowed, legally and constitutionally, to carry a gun almost anywhere ... is actually sort of the heart of what the gun rights movement believes is the future."

Over the last 30 years, a deep change has happened in American law and in American habit where state by state, places that once prohibited or strictly controlled the ability to carry a gun in everyday life have systematically relaxed those rules to the point that concealed carry is now legal in all 50 states.

General Backpack Industry Trends

The backpack is back. Sales of backpacks grew 9% in the past 12 months to $1.6 billion, according to data collected for Yahoo Finance by the consumer tracking service NPD Group. Sales of backpacks for use by adults (ages 18 and up) grew even more – 16% – and it was adult purchases that accounted for 69% of the overall market. In other words: the adult backpack is very hot right now.

The category is so popular that in 2014, backpack sales growth (up 18% that year among adult men and adult women) kept the $12 billion US bag market steady in a year when women’s handbags, the largest category, declined. In the face of the purse drop, backpacks gained popularity among women that year, and are still gaining.

This kind of market upswing creates new room for small, scrappy entrants. And indeed, smaller backpack players are carving out strong corners of an industry in which one giant, VF Corporation (VFC), enjoys more than 50% market share thanks to owning Timberland, The North Face, and Eastpak.

Fashion and function must come together to appeal to today’s always on-the-go consumer,” said Marshal Cohen, chief industry analyst, The NPD Group, Inc. “Male or female, consumers are carrying a lot of things around with them, and want a bag that looks good while also meeting their multifunctional needs.”

Bags worn by men accounted for $2.3 billion in sales in 2014, nearly one quarter of total industry results. Last year’s double-digit unit and dollar sales increases clearly make the men’s segment the one to watch in 2015. Men are purchasing more bags than ever before, and wearing bags of all types.

“The bag industry has an opportunity to continue to capture and keep the attention of male and female consumers alike by emphasizing designs that accommodate their lifestyles in both form and function,” added Cohen.

Our Advantages

The American Rebel Concealed Carry patent-pending Protection Pocket is an innovative advantage over the competition. The patent-pending Protection Pocket utilizes a sandwich concept to hold the firearm in place and positioned properly for quick and effective access. American Rebel Concealed Carry products are designed for everyday use while keeping you concealed and safe. American Rebel Concealed Carry products enable easy access to your firearm while remaining discreet.

The key selling feature is innovation, style, and brand. Currently, innovation is the key selling feature as American Rebel enjoys a first-to-market status with its current assortment of Concealed Carry Backpacks.

Product innovations and first-to-market status currently insulate the Company from competitor’s influence. Changes in competition may influence pricing policies in the future.

American Rebel has applied for patent protection on several items of its products, including the patent-pending Protection Pocket.

Market Opportunity

The Company believes it has identified an unmet need – Customers aren’t comfortable carrying a firearm holstered on their hip and they haven’t been introduced to a product that conceals the firearm properly, allows easy access to the firearm, and provides everyday value and utility for their daily routine. In addition, many potential customers would be interested in carrying a concealed firearm if they knew about a product that conceals the firearm properly, allows easy access to the firearm, and was their primary backpack for everyday use. These potential customers need to know the availability of our product and the steps they need to take to protect themselves, their family, their neighbors, or even a room full of total strangers.

The American Rebel Concealed Carry product line’s key selling feature is innovation, style, and brand. Its patent-pending Protection Pocket is an innovative advantage over the competition. American Rebel enjoys a first-to-market status with its current assortment of Concealed Carry Backpacks designed for everyday use. Product innovations and first-to-market status currently insulate the Company from competitors’ influence. The Company believes contact with its customers through its direct sales initiatives, its social media, and its profile at consumer trade shows will increase the relevancy of American Rebel products in the lives of its customers. Contact with its customers will also provide an excellent source of information for product performance and improvement and innovation.

Market Strategy

The American Rebel brand strategy includes multiple pathways to success, all of which focus back to the Company’s core mission of providing innovative products and promoting responsible gun ownership while celebrating “The American Rebel Spirit” in all of us.

Superior designs, proprietary technology, and a unique marketing approach put American Rebel in a position to dominate the rapidly growing tactical/concealed carry market. American Rebel strongly supports the 2nd Amendment, and conveys a sense of responsibility to teach and preach good common practices of gun ownership. American Rebel products are designed to keep people safe, keep them aware, and give them the tools to defend and protect. “There’s a growing need to know how to protect yourself, your family, your neighbors or even a room full of total strangers,” says American Rebel’s CEO Andy Ross. “That need is in the forethought of every product we design.”

American Rebel directly benefits from the awareness and persona that founder Andy Ross has cultivated his entire life. His outdoorsman and adventurer status will serve the brand well as it addresses the customer through television, radio, and data-driven digital marketing initiatives. In addition, Andy has assembled a brand development team to guide the Company in its infancy. The team members are all tenured in their respective fields, and in total bring hundreds of years of experience to the brand and the Company.

American Rebel Concealed Carry products were designed due to the popularity of Andy Ross’s song “Cold Dead Hand” and Andy’s music continues to be an important part of American Rebel’s marketing and its connection with its customers. American Rebel utilizes social media to put its products in front of its customers and Andy’s music and television persona provide organic content to keep our social media “fans” and “followers” engaged.

American Rebel has applied for patent protection on several items of its products, including the patent-pending Protection Pocket. Product innovations and first-to-market status currently insulate the Company from competitor’s influence. Potential customers aren’t comfortable carrying a firearm holstered on their hip and they haven’t been introduced to a product that conceals the firearm properly, allows easy access to the firearm, and also provides everyday value for their daily routine.

Product and Technology

The American Rebel patent-pending Protection Pocket utilizes a sandwich concept to hold the firearm in place and positioned properly for quick and effective access. American Rebel Concealed Carry products are designed for everyday use while keeping you concealed and safe. In addition to the patent-pending Protection Pocket, American Rebel Concealed Carry Backpacks employ the finest materials available – Ripstop water-resistance fabric, YKK zippers and branded pull tabs, UTX branded clips. Practical design provides properly sized pockets for laptops and tablets, felt-lined pocket for sunglasses, compartments for cell phones, chargers, water bottles, and other daily needed accessories. American Rebel Concealed Carry Backpacks also contain a protected area for extra magazines and ammunition.

Future Markets

American Rebel Concealed Carry Backpacks are designed for everyday use and the popularity of backpacks today make the American Rebel Concealed Carry Backpack an easy choice for most prospective customers interested in a backpack for everyday use that offers added features and benefits to keep them concealed and safe. For prospective customers interested in a traditional briefcase or computer bag, American Rebel will soon have a solution. The American Rebel Constitution line of products will include jackets, backpacks, briefcases and carry bags that provide concealed carry capabilities targeting business professionals and entrepreneurs in both a business and business casual setting. The Constitution line will feature traditional business stylings in appearance while providing the innovative American Rebel features and benefits that keep the user concealed and safe.

Intellectual Property

American Rebel has applied for patent protection for many of its proprietary features, including its patent-pending Protection Pocket and SmartPhone app. Company CEO Andy Ross has experience with intellectual property and values the protection and value IP can provide a company. We have and generally plan to continue to enter into non-disclosure, confidentially and intellectual property assignment agreements with all new employees as a condition of employment. In addition, we intend to also generally enter into confidentiality and non-disclosure agreements with consultants, manufacturers’ representatives, distributors, suppliers and others to attempt to limit access to, use and disclosure of our proprietary information. There can be no assurance, however, that these agreements will provide meaningful protection or adequate remedies for our trade secrets in the event of unauthorized use or disclosure of such information.

We also may from time to time rely on other intellectual property developed or acquired, including patents, technical innovations, laws of unfair competition and various other licensing agreements to provide our future growth and to build our competitive position. However, we can give no assurance that competitors will not infringe on our patent or other rights or otherwise create similar or non-infringing competing products that are technically patentable in their own right.

Research and Development

Our research and development programs are generally pursued by engineers and scientists employed by us or hired as consultants or through partnerships with industry leaders in manufacturing and design and researchers and academia. We are also working with subcontractors in developing specific components of our technologies. The primary objective of our research and development program is to advance the development of our existing and proposed products, to enhance the commercial value of such products.

Government Regulation

General

The right to bear arms is stated as the Second Amendment to the US Constitution and the trend of current laws and regulations is to reduce the burden on citizens desiring to bear arms. In spite of years of journalistic and public attention and debate, the United States has instituted few substantive changes in firearms policy over the past century. Opponents to increased gun control diluted a brief push by the Roosevelt administration in the 1930s and resulted in two minimalist federal statutes. A second effort to limit citizen’s access to firearms in the wake of the assassinations of John and Robert Kennedy and Martin Luther King produced the Gun Control Act of 1968, which largely remains the primary federal law. This modest control effort was subsequently diluted by the Firearms Owners Protection Act of 1986. The Clinton administration passed the Brady Act, requiring background checks on purchases from licensed firearms dealers, and a law directed at “assault weapons,” which sunset after ten years. For the past two decades, policy activity has shifted to the state legislatures and the courts, where concealed carry laws have granted more access to firearms and the Second Amendment has been recognized as an individual and fundamental right. Entrenched opposition to gun control in Congress and state legislatures, well-organized institutional opposition, and constitutional constraints have limited the risk of increased gun restrictions for the foreseeable future. It is important to note, though, that public sentiment is subject to change and voters could demand greater restrictions on access to firearms and influence Congress and state legislatures to enact tougher gun access legislation; but that is not the current mood or trend.

In addition to the above, the only regulations we encounter are the regulations that are common to all businesses, such as employment legislation, implied warranty laws, and environmental, health and safety standards, to the extent applicable. We could also encounter in the future industry-specific government regulations that would govern our products. It is highly unlikely but there is a remote chance that it may become the case that regulatory approvals will be required for the design and manufacture of our products and proposed products.

Foreign Regulation and Markets

The right to bear arms as stated in the Second Amendment to the US Constitution is uniquely American and American Rebel is uniquely “American,” especially considering the benefit of the concealed carry characteristics of our products. That being said, the Company has been approached by an exporter who believes because American Rebel products are uniquely “American” that they may have a receptive audience in Asia. The Company is not anticipating any revenue from foreign markets but will explore any proposals to partner with any companies specializing in foreign markets. If any substantive opportunities develop, American Rebel will address any foreign regulations that require the Company’s adherence.

Quality Management System

As the Company grows, we may also need to establish a suitable and effective quality management system, which establishes controlled processes for our product design, manufacturing, and distribution. We have a consultant with access to our current manufacturing facilities and the Company currently enjoys an excellent relationship with our manufacturing sources. Our products are not limited to a single source and the Company has access to a vast network of potential manufacturers.

Employees

The Company currently utilizes consultants and individual contractors to advance its business objectives and intends to hire full-time employees to oversee day-to-day operations of the Company and with the consultants, support management, engineering, manufacturing, and administration. The Company has no unionized employees.

Based on funding ability, the Company currently plans to hire 5 to 10 additional full-time employees within the next 12 months, whose principal responsibilities will be the support of our sales, marketing, research and development, and operational activities.

We consider relations with our consultants and contractors to be satisfactory.

ITEM 1A. RISK FACTORS

The following risk factors should be considered in connection with an evaluation of our business:

In addition to other information in this Report, the following risk factors should be carefully considered in evaluating our business because such factors may have a significant impact on our business, operating results, liquidity and financial condition. As a result of the risk factors set forth below, actual results could differ materially from those projected in any forward-looking statements. Additional risks and uncertainties not presently known to us, or that we currently consider to be immaterial, may also impact our business, result of operations, liquidity and financial condition. If any such risks occur, our business, operating results, liquidity and financial condition could be materially affected in an adverse manner. Under such circumstances, if and when a trading market for our securities is established, the trading price of our securities could decline, and you may lose all or part of your investment.

OUR SECURITIES INVOLVE A HIGH DEGREE OF RISK AND, THEREFORE, SHOULD BE CONSIDERED EXTREMELY SPECULATIVE. THEY SHOULD NOT BE PURCHASED BY PERSONS WHO CANNOT AFFORD THE POSSIBILITY OF THE LOSS OF THE ENTIRE INVESTMENT.

COVID-19

The past, current and potential effects of coronavirus and future coronavirus variants may impact our business, results of operations and financial condition.

Actual or threatened epidemics, pandemics, outbreaks, or other public health crises could materially and adversely impact or disrupt our operations, adversely affect the local economies where we operate and negatively impact our customers’ spending in the impacted regions or depending upon the severity, globally, which could materially and adversely impact our business, results of operations and financial condition. For example, a strain of novel coronavirus (causing “COVD-19”) surfaced in China and has spread into the United States, Europe and most other countries of the world, resulting in certain supply chain disruptions, volatilities in the stock market, lower oil and other commodity prices due to diminished demand, massive unemployment, and lockdown on international travels, all of which has had an adverse impact on the global economy. There is significant uncertainty around the breadth and duration of the business disruptions related to COVID-19 and its variant strains, as well as its impact on the U.S. economy. Moreover, an epidemic, pandemic, outbreak or other public health crisis, such as COVID-19, could adversely affect our ability to adequately staff and manage our business. The extent to which COVID-19 or variants of COVID-19 impact our business, results of operations and financial condition will depend on future developments, which are highly uncertain, rapidly changing and cannot be predicted, including new information that may emerge concerning the severity of COVID-19 and the actions taken to contain it or treat it.

Risks Related to the Business

American Rebel has limited financial resources. Our independent registered auditors’ report includes an explanatory paragraph stating that there is substantial doubt about our ability to continue as a going concern.

As a result of our deficiency in working capital at December 31, 2020 and other factors, our auditors have included a paragraph in their audit report regarding substantial doubt about our ability to continue as a going concern. Our plans in this regard are to increase product sales, increase production, obtain inventory financing, seek strategic alternatives and to seek additional capital through future equity private placements or debt facilities.

We have recorded net losses since inception and have significant accumulated deficits. We have relied upon loans and equity financings for operating capital. Total revenues will be insufficient to pay off existing debt and fund operations. We may be required to rely on further debt financing, further loans from related parties, and private placements of our common and preferred stock for our additional cash needs. Such funding sources may not be available, or the terms of such funding sources may not be acceptable to the Company.

Our indebtedness could adversely affect our business and limit our ability to plan for or respond to changes in our business, and we may be unable to generate sufficient cash flow to satisfy significant debt service obligations.

As of December 31, 2020, our consolidated indebtedness was $6,133,800, with approximately $914,189 due to related parties. Our indebtedness could have important consequences, including the following:

·increasing our vulnerability to general adverse economic and industry conditions;

·reducing the availability of our cash flow for other purposes;

·limiting our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate, which would place us at a competitive disadvantage compared to our competitors that may have less debt; and

·having a material adverse effect on our business if we fail to comply with the covenants in our debt agreements, because such failure could result in an event of default that, if not cured or waived, could result in all or a substantial amount of our indebtedness becoming immediately due and payable.

Further, a significant portion of our current indebtedness is in default, which subjects us to potential litigation, increased fees and expenses, increased interest rates and other potential damages.

Our ability to repay our significant indebtedness will depend on our ability to generate cash, whether through cash from operations or cash raised through the issuance of additional equity-based securities. To a certain extent, our ability to generate cash is subject to general economic, financial, competitive, legislative, regulatory, and other factors that are beyond our control. If our business does not generate sufficient cash flow from operations or if future equity financings are not available to us in amounts sufficient to enable us to fund our liquidity needs, our financial condition and operating results may be adversely affected. If we cannot make scheduled principal and interest payments on our debt obligations in the future, we may need to refinance all or a portion of our indebtedness on or before maturity, sell assets, delay capital expenditures, cease operations or seek additional equity.

Despite the Company’s indebtedness levels, we are able to incur substantially more debt. This could further increase the risks associated with its leverage.

The Company may incur substantial additional indebtedness in the future. Although, certain terms of current debt agreements do prohibit us from doing so. To the extent that the Company incurs additional indebtedness, the risks associated with its substantial indebtedness describe above, including its possible inability to service its debt, will increase.

A significant portion of our current debt is in default, which may subject us to litigation by the debt holders.

As of December 31, 2020, we only had cash and cash equivalents of $60,899 and had a significant amount of short-term debt in default. The short-term debt agreements provide legal remedies for satisfaction of defaults, including increased interest rates, default fees and other financial penalties. As of the date of this Annual Report none of the lenders have pursued their legal remedies, although a lender has sent us a demand letter and threatened litigation. Management’s plan is to raise additional funds in the form of debt or equity in order to continue to fund losses until such time as revenues are able to sustain the Company. To date, the main source of funding has been through the issuance of debt securities. There is no assurance that management will be successful in being able to continue to obtain additional funding or defend potential litigation by note holders.

We will need additional capital in the future to finance our planned growth, which we may not be able to raise or it may only be available on terms unfavorable to us or our stockholders, which may result in our inability to fund our working capital requirements and harm our operational results.

We have and expect to continue to have substantial working capital needs. Our cash on hand, together with cash generated from product sales, services, cash equivalents and short-term investments will not meet our working capital and capital expenditure requirements for the next twelve months. In fact, we will be required to raise additional funds throughout 2021 or we will need to limit operations until such time as we can raise substantial funds to meet our working capital needs. In addition, we will need to raise additional funds to fund our operations and implement our growth strategy, or to respond to competitive pressures and/or perceived opportunities, such as investment, acquisition, marketing and development activities.

If we experience operating difficulties or other factors, many of which may be beyond our control, cause our revenues or cash flows from operations, if any, to decrease, we may be limited in our ability to spend the capital necessary to complete our development, marketing and growth programs. We require additional financing, in addition to anticipated cash generated from our operations, to fund our working capital requirements. Additional financing might not be available on terms favorable to us, or at all. If adequate funds were not available or were not available on acceptable terms, our ability to fund our operations, take advantage of unanticipated opportunities, develop or enhance our business or otherwise respond to competitive pressures would be significantly limited. In such a capital restricted situation, we may curtail our marketing, development, and operational activities or be forced to sell some of our assets on an untimely or unfavorable basis.

We are highly dependent on our officers and directors. The loss of any of them, whose knowledge, leadership and technical expertise upon which we rely, could harm our ability to execute our business plan.

Our success depends heavily upon the continued contributions of our current officers and directors, whose knowledge, leadership and technical expertise may be difficult to replace at this stage in our business development, and on our ability to retain and attract experienced experts, and other technical and professional staff. If we were to lose the services of our officers or directors, our ability to execute our business plan would be harmed and we may be forced to limit operations until such time as we could hire suitable replacements.

At this stage of our business operations, even with our good faith efforts, potential investors have an increased probability of losing their entire investment.

Because the nature of our business is expected to change as a result of shifts in the industries in which we operate, competition, and the development of new and improved technology, management forecasts are not necessarily indicative of future operations and should not be relied upon as an indication of future performance. Further, we have raised substantial debt and equity to fund our business operations, which to date have generated insufficient revenue to support our working capital needs.

While Management believes its estimates of projected occurrences and events are within the timetable of its business plan, our actual results may differ substantially from those that are currently anticipated. If our revenues do not increase to a level to support our working capital needs, we will be forced to seek equity capital to fund our operations and repay our substantial debt balances, which may not be available to us at all or on acceptable terms.

The Company has a limited operating history upon which investors can evaluate our future prospects.

The Company has a limited operating history upon which an evaluation of its business plan or performance and prospects can be made. The business and prospects of the Company must be considered in the light of the potential problems, delays, uncertainties and complications encountered in connection with a newly established business and creating a new line of products. The risks include, but are not limited to, the possibility that we will not be able to develop functional and scalable products, or that although functional and scalable, our products and will not be economical to market; that our competitors hold proprietary rights that preclude us from marketing such products; that our competitors market a superior or equivalent product; that our competitors have such a significant advantage in brand recognition that our products will not be considered by potential customers; that we are not able to upgrade and enhance our technologies and products to accommodate new features as the market evolves; or the failure to receive necessary regulatory clearances for our products. To successfully introduce and market our products at a profit, we must establish brand name recognition and competitive advantages for our products. There are no assurances that we can successfully address these challenges. If it is unsuccessful, we and our business, financial condition and operating results could be materially and adversely affected.

The current and future expense levels are based largely on estimates of planned operations and future revenues rather than experience. It is difficult to accurately forecast future revenues because our business is new and our market is rapidly developing. If our forecasts prove incorrect, the business, operating results and financial condition of the Company will be materially and adversely affected. Moreover, we may be unable to adjust our spending in a timely manner to compensate for any unanticipated reduction in revenue. As a result, any significant reduction in revenues would immediately and adversely affect our business, financial condition and operating results.

We have had limited revenues since inception, and we cannot predict when we will achieve profitability.

American Rebel has not been profitable and cannot predict when or if we will achieve profitability. We have experienced net losses and have had limited revenues since our inception in December 2014. We do not anticipate generating significant revenues until we successfully develop, commercialize and sell our existing and proposed products, of which we can give no assurance. We are unable to determine when we will generate significant revenues, if any, from the sale of any of such products.

We cannot predict when we will achieve profitability, if ever. Our inability to become profitable may force us to curtail or temporarily discontinue our research and development programs and our day-to-day operations. Furthermore, there can be no assurance that profitability, if achieved, can be sustained on an ongoing basis. As of December 31, 2020, we had an accumulated deficit of $20,870,713.

We may not meet our product development and commercialization milestones.

We have established milestones, based upon our expectations regarding our technologies at that time, which we use to assess our progress toward developing our products. These milestones relate to technology and design improvements as well as to dates for achieving development goals. If our products exhibit technical defects or are unable to meet cost or performance goals, our commercialization schedule could be delayed and potential purchasers of our initial commercial products may decline to purchase such products or may opt to pursue alternative products.

We may also experience shortages of raw materials and labor due to manufacturing difficulties. Our manufacturing operations could be disrupted by fire, earthquake or other natural disasters, a labor-related disruption, failure in supply or other logistical channels, electrical outages or other reasons. If there were a disruption to manufacturing facilities, we would be unable to manufacture products until we have restored and re-qualified our manufacturing capability or developed alternative manufacturing facilities.

Generally, we have made advances meeting our milestone schedules as our entire Concealed Carry product line was introduced at the 2017 NRA Convention. We can give no assurance that our commercialization schedule will continue to be met as we further develop other proposed products.

Our Business is dependent on introducing our products to potential customers interested in concealed carry goods and if we fail to properly introduce our products to these potential customers, our revenue could fail to grow and could decrease.

The Company enjoyed rapid acceptance of its brand and products during the 2017 NRA Convention, but a significant risk exists that the Company will be able to reach potential customers through the remainder of the year outside of the NRA Convention. To reach potential customers the Company will employ social media awareness campaigns and remarket the Company’s products to potential customers who show any interest in the Company’s goods. There can be no assurance the Company will effectively employ social media awareness campaigns to reach potential customers. The Company will also create video content to educate potential customers about its products. There can be no assurance the Company will be effective at creating effective video content and there can also be no assurance the Company will efficiently reach potential customers.

We are subject to potential governmental regulations relating to access to firearms.

Our products are designed to properly carry a concealed firearm. Federal or state laws and regulations could be adopted to limit our ability to sell our products. Our products may have to be altered or have features removed to obtain compliance with laws and regulations. There can be no assurance that the current trend that limits additional restrictions on access to firearms will continue.

If we are not able to both obtain and maintain adequate levels of investment, it would have a material adverse effect on our business.

A new business selling products requires capital investment to research and develop the new products. Capital investment is required to create awareness of the new business’s products and market the new business’s products. If the Company is unable to obtain and maintain adequate levels of capital investment, the Company will be unable to manufacture its inventory and market its inventory to grow its revenues and establish its brand.

Product defects could adversely affect the results of our operations.

The design, manufacture and marketing of our products involve certain inherent risks. Manufacturing or design defects, unanticipated use of our products, or inadequate disclosure of risks relating to the use of our products can lead to injury or other adverse events. The Company may not properly anticipate customer applications of our products and our products may fail to survive such unanticipated customer use. If the Company’s products fail to adequately perform to meet the customer’s expectations, the customer may demand refunds or replacements which will negatively affect the Company’s profitability.

We could be exposed to significant liability claims if we are unable to obtain insurance at acceptable costs and adequate levels or otherwise protect ourselves against potential product liability claims.

The Company’s products support the use and access to firearms and if the Company’s products are ineffective the Company could require protection against potential product liability claims.

We require additional capital to support our present business plan and our anticipated business growth, and such capital may not be available on acceptable terms, or at all, which would adversely affect our ability to operate.

We will require additional funds to further develop our business plan. Based on our current operating plans, we require a minimum of $6 million to fund our planned operations necessary to effectively introduce our brand and products into the market. We can give no assurance that we will be successful in raising any funds. Additionally, if we are unable to generate sufficient revenues from our operating activities, we may need to raise additional funds through equity offerings or otherwise in order to meet our expected future liquidity requirements, including to introduce our other planned products or to pursue new product opportunities. Any such financing that we undertake will likely be dilutive to current stockholders and you.

We intend to continue to make investments to support our business growth, including patent or other intellectual property asset creation. In addition, we may also need additional funds to respond to business opportunities and challenges, including our ongoing operating expenses, protecting our intellectual property, satisfying debt payment obligations, developing new lines of business and enhancing our operating infrastructure. While we may need to seek additional funding for such purposes, we may not be able to obtain financing on acceptable terms, or at all. In addition, the terms of our financings may be dilutive to, or otherwise adversely affect, holders of its common stock. We may also seek additional funds through arrangements with collaborators or other third parties. We may not be able to negotiate any such arrangements on acceptable terms, if at all. If we are unable to obtain additional funding on a timely basis, we may be required to curtail or terminate some or all of our business plans.

We cannot predict our future capital needs and we may not be able to secure additional financing.

We will need to raise additional funds in the future to fund our working capital needs and to fund further expansion of our business. We may require additional equity or debt financings, collaborative arrangements with corporate partners or funds from other sources for these purposes. No assurance can be given that necessary funds will be available for us to finance our development on acceptable terms, if at all. Furthermore, such additional financings may involve substantial dilution of our stockholders or may require that we relinquish rights to certain of our technologies or products. In addition, we may experience operational difficulties and delays due to working capital restrictions. If adequate funds are not available from operations or additional sources of financing, we may have to delay or scale back our growth plans.

The results of our research and development efforts are uncertain and there can be no assurance of the commercial success of our products.

We believe that we will need to incur additional research and development expenditures to continue development of our existing proposed products as well as research and development expenditures to develop new products. The products we are developing and may develop in the future may not be successful. In addition, the length of our product and service development cycle may be greater than we originally expected and we may experience delays in product development. If our resulting products and services are not technologically successful, they may not achieve market acceptance or compete effectively with our competitors’ products and services.

If we fail to retain certain of our key personnel and attract and retain additional qualified personnel, we might not be able to pursue our growth strategy.

Our future success will depend upon the continued service of Andy Ross, our President and Chief Executive Officer. Although we believe that our relationship with him is positive, there can be no assurance that his services will continue to be available to us in the future. We do not carry key man life insurance policies on Mr. Ross at this time.

The impact of our patent applications may be limited.

There can be no assurance that we will be successful at obtaining patent protection for our features for which we have applied for patent protection. If we are unsuccessful at obtaining patent protection, we may suffer from competitors copying our features that distinguish our products.

We will not be profitable unless we can demonstrate that our products can be manufactured at low prices.

To date, we have manufactured our products in limited volume. As the Company creates demand for its products, our projections require the benefit of volume discounts as we increase the size of our order. We can offer no assurance that either we or our manufacturing partners will develop efficient, automated, low-cost manufacturing capabilities and processes to meet the quality, price, engineering, design and production standards or production volumes required to successfully mass market our products. Even if we or our manufacturing partners are successful in developing such manufacturing capability and processes, we do not know whether we or they will be timely in meeting our product commercialization schedule or the production and delivery requirements of potential customers. A failure to develop such manufacturing processes and capabilities could have a material adverse effect on our business and financial results.

Our profitability in part is dependent on material and other manufacturing costs. We are unable to offer any assurance that either we or a manufacturing partner will be able to reduce costs to a level which will allow production of a competitive product or that any product produced using lower cost materials and manufacturing processes will not suffer from a reduction in performance, reliability and longevity.

Our dependence on a limited number of suppliers may prevent us from delivering our devices on a timely basis.

We currently rely on a limited number of suppliers of our products. If these suppliers became unable to provide products in the volumes needed or at an acceptable price, we would have to identify and qualify acceptable replacements from alternative sources of supply. The process of qualifying suppliers is lengthy. Delays or interruptions in the supply of our requirements could limit or stop our ability to provide sufficient quantities of products on a timely basis, which could have a material adverse effect on our business, financial condition and results of operations.

Our financial results may be affected by tariffs or border adjustment taxes or other import restrictions.

Our current supplier has facilities both in China and Mexico and the imposition of tariffs or border adjustment taxes may affect our financial results. The current political climate is hostile to companies manufacturing goods outside of the US. At the current manufacturing levels, it is impractical to seek manufacturing facilities in the US as US manufacturers are unable to meet or even approach the cost of manufacturing small quantities of custom-made goods. American Rebel is searching for a US-based manufacturer that can produce its goods once higher quantity orders are required by product demand.

We may not be successful in hiring personnel because of the competitive market for qualified people.

The Company's future success depends largely on its ability to attract, hire, train and retain highly qualified personnel to provide the Company's services. Competition for such personnel may be intense. There can be no assurance that the Company will be successful in attracting and retaining the specific personnel it requires to conduct and expand its operations successfully or to differentiate itself from its competitors. The Company's results of operations and growth prospects could be materially adversely affected if the Company was unable to attract, hire, train and retain such qualified personnel.

Fluctuations in our financial results make quarterly comparisons and financial forecasting difficult.

The Company's future or projected quarterly operating results may vary and reduced levels of earnings or continued losses may be experienced in one or more quarters. Fluctuations in the Company's quarterly operating results could result from a variety of factors, including changes in the levels of revenues, the size and timing of orders, changes in the mix of future products, the timing of new offerings by the Company or its competitors, changes in pricing policies by the Company or its competitors, market acceptance of new and enhanced products or services offered by the Company or its competitors, changes in operating expenses, availability of qualified personnel, disruption in sources of related product and services, the effect of potential acquisitions and industry and general economic factors. The Company will have limited or no control over many of these factors. The Company's expenses we believe will be based upon, in part, on its expectation as to future or projected revenues. If revenue levels are below expectations, operating results are likely to be adversely affected.

Because of these fluctuations and uncertainties, our future operating results may fail to meet the expectations of investors. If this happens, any trading price of our common stock could be materially adversely affected.

We are subject to the periodic reporting requirements of Section 15(d) and 12(g) of the Exchange Act that require us to incur audit fees and legal fees in connection with the preparation of such reports. These additional costs could reduce or eliminate our ability to earn a profit.

We are required to file periodic reports with the SEC pursuant to the Exchange Act and the rules and regulations promulgated thereunder. In order to comply with these requirements, our independent registered public accounting firm will have to review our financial statements on a quarterly basis and audit our financial statements on an annual basis. Moreover, our legal counsel will have to review and assist in the preparation of such reports. The costs charged by these professionals for such services cannot be accurately predicted at this time because factors such as the number and type of transactions that we engage in and the complexity of our reports cannot be determined at this time and will affect the amount of time to be spent by our auditors and attorneys. However, the incurrence of such costs will obviously be an expense to our operations and thus have a negative effect on our ability to meet our overhead requirements and earn a profit.

However, for as long as we remain an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, or JOBS Act, we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding an annual nonbinding advisory vote on executive compensation and seeking nonbinding stockholder approval of any golden parachute payments not previously approved. We may take advantage of these reporting exemptions until we are no longer an “emerging growth company.”

We will remain an “emerging growth company” for up to five years, although we would cease to be an “emerging growth company” prior to such time if we have more than $1.0 billion in annual revenue, more than $700 million in market value of our common stock is held by non-affiliates or we issue more than $1.0 billion of non-convertible debt over a three-year period.

If we cannot provide reliable financial reports or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our common stock, if a market ever develops, could drop significantly.

Our internal controls may be inadequate, which could cause our financial reporting to be unreliable and lead to misinformation being disseminated to the public.

Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. As defined in Exchange Act Rule 13a-15(f), internal control over financial reporting is a process designed by, or under the supervision of, the principal executive and principal financial officer and effected by the Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

·pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company;

·provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and/or directors of the Company; and

·provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

Our internal controls may be inadequate or ineffective, which could cause financial reporting to be unreliable and lead to misinformation being disseminated to the public. Investors relying upon this misinformation may make an uninformed investment decision.

Failure to achieve and maintain an effective internal control environment could cause us to face regulatory action and also cause investors to lose confidence in our reported financial information, either of which could have a material adverse effect on the Company’s business, financial condition, results of operations and future prospects.

However, our auditors will not be required to formally attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 until we are no longer an “emerging growth company” as defined in the JOBS Act if we take advantage of the exemptions available to us through the JOBS Act.

The costs of being a public company could result in us being unable to continue as a going concern.

As a public company, we are required to comply with numerous financial reporting and legal requirements, including those pertaining to audits and internal control. The costs of maintaining public company reporting requirements could be significant and may preclude us from seeking financing or equity investment on terms acceptable to us and our shareholders. We estimate these costs to be in excess of $100,000 per year and may be higher if our business volume or business activity increases significantly. Our current estimate of costs does not include the necessary expenses associated with compliance, documentation and specific reporting requirements of Section 404 as we will not be subject to the full reporting requirements of Section 404 until we exceed $700 million in market capitalization or we decide to opt-out of the “emerging growth company” as defined under the JOBS Act. This exemption is available to us under the JOBS Act or until we have been public for more than five years.

If our revenues are insufficient or non-existent, and/or we cannot satisfy many of these costs through the issuance of shares or debt, we may be unable to satisfy these costs in the normal course of business. This would certainly result in our being unable to continue as a going concern.

Risks Related to our Common Stock

Persons who purchase shares of our common stock may lose their money without us ever being able to develop a market.

In the event that no market to purchase our common shares is ever created, it is likely that the entire investment of a purchaser in our common stock would be lost.

Shareholders may be diluted significantly through our efforts to obtain financing and satisfy obligations through issuance of additional shares.

We do not have any committed sources of financing. Our Board of Directors has authority, without action or vote of the shareholders, to issue all or part of the authorized (100,000,000) shares but unissued (20,533,437) shares. In addition, if a trading market ever develops for our common stock, we may attempt to raise additional capital by selling shares, possibly at a deep discount to market. These actions will result in dilution of the ownership interests of existing shareholders, further dilute common stock book value, and that dilution may be material.

The interests of shareholders may be hurt because we can issue shares to individuals or entities that support existing management with such issuances serving to enhance existing management’s ability to maintain control of our company.

Our Board of Directors has authority, without action or vote of the shareholders, to issue all or part of the authorized but unissued common shares. Such issuances may be issued to parties or entities committed to supporting existing management and the interests of existing management which may not be the same as the interests of other shareholders. Our ability to issue shares without shareholder approval serves to enhance existing management’s ability to maintain control of our company.

Our articles of incorporation provide for indemnification of officers and directors at our expense and limit their liability that may result in a major cost to us and hurt the interests of our shareholders because corporate resources may be expended for the benefit of officers and directors.

Our Articles of Incorporation at Article XI provide for indemnification as follows: “No director or officer of the corporation shall be personally liable to the corporation or any of its stockholders for damages for breach of fiduciary duty as a director or officer; provided, however, that the foregoing provision shall not eliminate or limit the liability of a director or officer: (i) for acts or omissions which involve intentional misconduct, fraud or knowing violation of law; or (ii) the payment of dividends in violation of Section 78.300 of the Nevada Revised Statutes. Any repeal or modification of an Article by the stockholders of the corporation shall be prospective only, and shall not adversely affect any limitation of the personal liability of a director or officer of the corporation for acts or omissions prior to such repeal or modification”.

We have been advised that, in the opinion of the SEC, indemnification for liabilities arising under federal securities laws is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification for liabilities arising under federal securities laws, other than the payment by us of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding, is asserted by a director, officer or controlling person in connection with our activities, we will (unless in the opinion of our counsel, the matter has been settled by controlling precedent) submit to a court of appropriate jurisdiction, the question whether indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. The legal process relating to this matter if it were to occur is likely to be very costly and may result in us receiving negative publicity, either of which factors is likely to materially reduce the market and price for our shares, if such a market ever develops.

There is a limited trading market for our shares of common stock on the OTC Market. You may not be able to sell your shares of common stock if you need money.

Our common stock is traded on the OTC Market, an inter-dealer automated quotation system for equity securities. There has been limited trading activity in our common stock, and when it has traded, the price has fluctuated widely. We consider our common stock to be “thinly traded” and any last reported sale prices might not be a true market-based valuation of the common stock. Stockholders may experience difficulty selling their shares if they choose to do so because of the illiquid market and limited public float for our common stock.

Because our common stock is deemed a low-priced “Penny” stock, an investment in our common stock should be considered high risk and subject to marketability restrictions.

Since our common stock is a penny stock, as defined in Rule 3a51-1 under the Securities Exchange Act of 1934, as amended, it will be more difficult for investors to liquidate their investment even if and when a market develops for the common stock. Until the trading price of the common stock rises above $5.00 per share, if ever, trading in the common stock is subject to the penny stock rules of the Securities Exchange Act specified in rules 15g-1 through 15g-10. Those rules require broker-dealers, before effecting transactions in any penny stock, to:

·Deliver to the customer, and obtain a written receipt for, a disclosure document;

·Disclose certain price information about the stock;

·Disclose the amount of compensation received by the broker-dealer or any associated person of the broker-dealer;

·Send monthly statements to customers with market and price information about the penny stock; and

·In some circumstances, approve the purchaser’s account under certain standards and deliver written statements to the customer with information specified in the rules.

Consequently, the penny stock rules may restrict the ability or willingness of broker-dealers to sell the common stock and may affect the ability of holders to sell their common stock in the secondary market and the price at which such holders can sell any such securities. These additional procedures could also limit our ability to raise additional capital in the future.

Financial Industry Regulatory Authority, Inc. (“FINRA”) sales practice requirements may limit a shareholder’s ability to buy and sell our common shares.

In addition to the “penny stock” rules described above, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

If we fail to maintain effective internal controls over financial reporting, then the price of our common stock may be adversely affected.

Our internal control over financial reporting may have weaknesses and conditions that could require correction or remediation, the disclosure of which may have an adverse impact on the price of our common stock. We are required to establish and maintain appropriate internal controls over financial reporting. Failure to establish those controls, or any failure of those controls once established, could adversely affect our public disclosures regarding our business, prospects, financial condition or results of operations. In addition, management’s assessment of internal controls over financial reporting may identify weaknesses and conditions that need to be addressed in our internal controls over financial reporting or other matters that may raise concerns for investors. Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial reporting or disclosure of management’s assessment of our internal controls over financial reporting may have an adverse impact on the price of our common stock.

Transfers of our securities may be restricted by virtue of state securities “blue sky” laws that prohibit trading absent compliance with individual state laws. These restrictions may make it difficult or impossible to sell shares in those states.

Transfers of our common stock may be restricted under the securities or securities regulation laws promulgated by various states and foreign jurisdictions, commonly referred to as “blue sky” laws. Absent compliance with such individual state laws, our common stock may not be traded in such jurisdictions. Because the securities registered hereunder have not been registered for resale under the blue sky laws of any state, the holders of such shares and persons who desire to purchase them should be aware that there may be significant state blue sky law restrictions upon the ability of investors to sell the securities and of purchasers to purchase the securities. These restrictions may prohibit the secondary trading of our common stock. Investors should consider the secondary market for our securities to be a limited one.

The market for penny stocks has experienced numerous frauds and abuses that could adversely impact investors in our stock.

Company management believes that the market for penny stocks has suffered from patterns of fraud and abuse. Such patterns include:

·Control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer;

·Manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases;

·“Boiler room” practices involving high-pressure sales tactics and unrealistic price projections by sales- persons;

·Excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and

·Wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the inevitable collapse of those prices with consequent investor losses.

Our board of directors has the authority, without stockholder approval, to issue preferred stock with terms that may not be beneficial to common stockholders and with the ability to affect adversely stockholder voting power and perpetuate their control over us.

Our Articles of Incorporation allow us to issue shares of preferred stock without any vote or further action by our stockholders. Our Board of Directors has the authority to fix and determine the relative rights and preferences of preferred stock. Our Board of Directors has the authority to issue preferred stock without further stockholder approval, including large blocks of preferred stock. As a result, our Board of Directors could authorize the issuance of a series of preferred stock that would grant to holders the preferred right to our assets upon liquidation, the right to receive dividend payments before dividends are distributed to the holders of common stock and the right to the redemption of the shares, together with a premium, prior to the redemption of our common stock. We do not expect to pay cash dividends in the foreseeable future.

We have never paid cash dividends on our common stock. We do not expect to pay cash dividends on our common stock at any time in the foreseeable future. The future payment of dividends directly depends upon our future earnings, capital requirements, financial requirements and other factors that our Board of Directors will consider. Since we do not anticipate paying cash dividends on our common stock, return on your investment, if any, will depend solely on an increase, if any, in the market value of our common stock.

We are an “emerging growth company” and cannot be certain whether the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.

We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding an annual non-binding advisory vote on executive compensation and nonbinding stockholder approval of any golden parachute payments not previously approved. We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

In addition, Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. However, we are choosing to “opt out” of such extended transition period, and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

Because we are not subject to compliance with rules requiring the adoption of certain corporate governance measures, our stockholders have limited protection against interested director transactions, conflicts of interest and similar matters.

The Sarbanes-Oxley Act of 2002, as well as rule changes proposed and enacted by the SEC, the New York and American Stock Exchanges and the NASDAQ Stock Market, as a result of Sarbanes-Oxley, require the implementation of various measures relating to corporate governance. These measures are designed to enhance the integrity of corporate management and the securities markets and apply to securities that are listed on those exchanges or the NASDAQ Stock Market. Because we are not presently required to comply with many of the corporate governance provisions and because we chose to avoid incurring the substantial additional costs associated with such compliance any sooner than legally required, we have not yet adopted these measures.

Because only one of our directors is independent, we do not currently have independent audit or compensation committees. As a result, our directors have the ability, among other things, to determine their own level of compensation. Until we comply with such corporate governance measures, regardless of whether such compliance is required, the absence of such standards of corporate governance may leave our stockholders without protections against interested director transactions, conflicts of interest, if any, and similar matters and investors may be reluctant to provide us with funds necessary to expand our operations.

We intend to comply with all corporate governance measures relating to director independence as and when required. However, we may find it very difficult or be unable to attract and retain qualified officers, directors and members of board committees required to provide for our effective management as a result of Sarbanes-Oxley Act of 2002. The enactment of the Sarbanes-Oxley Act of 2002 has resulted in a series of rules and regulations by the SEC that increase responsibilities and liabilities of directors and executive officers. The perceived increased personal risk associated with these recent changes may make it more costly or deter qualified individuals from accepting these roles. The perceived increased personal risk associated with these recent changes may make it more costly or deter qualified individuals from accepting these roles. Some of these corporate governance measures have been metered by the JOBS Act of 2012.

We have the ability to issue additional shares of our common stock and shares of preferred stock without obtaining stockholder approval, which could cause your investment to be diluted.

Our Articles of incorporation authorizes the Board of Directors to issue up to 100,000,000 shares of common stock and up to 1,000,000 shares of preferred stock, of which we have designated 100,000 shares as Series A. The power of the Board of Directors to issue shares of common stock, preferred stock or warrants or options to purchase shares of common stock or preferred stock is generally not subject to stockholder approval. Accordingly, any additional issuance of our common stock, or preferred stock that may be convertible into common stock, may have the effect of diluting your investment. Along these lines, at December 31, 2019 we had approximately 43.1 million shares of common stock outstanding and ended 2020 with approximately 72.8 million shares outstanding, an increase of 1.7 times. In addition, as of March 31, 2021 we had approximately 76.7 million shares outstanding.

Our Board of Directors has issued Series B Preferred Stock with voting terms that may not be beneficial to common stockholders and has the ability to affect adversely stockholder voting power and allows our current management to perpetuate their control over us.

Our Articles of Incorporation allow us to issue shares of preferred stock without any vote or further action by our stockholders. Along these lines, our Board of Directors authorized 100,000 shares of Series A Preferred Stock, which were issued to two members of our current management (Messrs. Ross and Grau). These shares have superior voting rights (1,000 to 1) over shares of our Common Stock. Further, our Board of Directors has the ability to fix and determine the relative rights and preferences of additional series of preferred stock. Our Board of Directors has the authority to issue additional series of preferred stock without further stockholder approval, including large blocks of preferred stock that would grant to the holders the preferred right to our assets upon liquidation, the right to receive dividend payments before dividends are distributed to the holders of common stock, superior voting or conversion rights and the right to the redemption of the shares, together with a premium, prior to the redemption of our common stock.

By issuing preferred stock, we may be able to delay, defer or prevent a change of control.

We are authorized to issue a total of 1,000,000 shares of “blank check” preferred stock and have issued: 100,000 shares of Series A Preferred Stock (which contain voting rights of 1,000-to-1). Our Board of Directors can determine the rights, preferences, privileges, and restrictions granted to, or imposed upon, the shares of preferred stock and to fix the number of shares constituting any series and the designation of such series. It is possible that our Board of Directors, in determining the rights, preferences and privileges to be granted when the preferred stock is issued, may include provisions that have the effect of delaying, deferring, or preventing a change in control, discouraging bids for our common stock at a premium over the market price, or that adversely affect the market price of and the voting and other rights of the holders of our common stock.

Future sales of our common stock may result in a decrease in the market price of our common stock, even if our business is doing well.

The market price of our common stock could drop due to sales of a large number of shares of our common stock in the market or the perception that such sales could occur. This could make it more difficult to raise funds through future offerings of common stock.

Our articles of incorporation and bylaws contain provisions that could discourage an acquisition or change of control of us.

Our articles of incorporation authorize our Board of Directors to issue preferred stock and common stock without stockholder approval. If our board of directors’ elects to issue preferred stock, it could be more difficult for a third party to acquire control of us. In addition, provisions of the articles of incorporation and bylaws could also make it more difficult for a third party to acquire control of us.

Increased dealer compensation could adversely affect our stock price.

The dealer’s spread (the difference between the bid and ask prices) may be large and may result in substantial losses to the seller of shares of our common stock may incur an immediate “paper” loss due to the price spread. Moreover, dealers trading on the OTC Market may not have a bid price for shares of our common stock on the OTC Market. Due to the foregoing, demand for shares of our common stock on the OTC Market may be decreased or eliminated.

Risks Related to Our Industry

The industry in which we operate is competitive, price sensitive and subject to risks of governmental regulations or laws. If our competitors are better able to develop and market products that are more effective, less costly, easier to use, or are otherwise more attractive, we may be unable tocompete effectively with other companies.

The concealed carry and tactical goods industry is characterized by intense competition. We will face competition on the basis of product features, price, services, apparent value, and other factors. Competitors may include large apparel makers and other companies, some of which have significantly greater financial and marketing resources than we do, and firms that are more specialized than we are with respect to particular markets. Our competition may respond more quickly to new or emerging styles, undertake more extensive marketing campaigns, have greater financial, marketing and other resources than ours or may be more successful in attracting potential customers, employees and strategic partners.

Our competitive position will depend on multiple, complex factors, including our ability to achieve market acceptance for our products, develop new products, implement production and marketing plans, and protect our intellectual property. The development of new or improved products, processes or technologies by other companies may render our products or proposed products obsolete or less competitive. The entry into the market of manufacturers located in low-cost manufacturing locations may also create pricing pressure, particularly in developing markets. Our future success depends, among other things, upon our ability to compete effectively against current providers, as well as to respond effectively to changes in popular styles and customer requirements, and upon our ability to successfully implement our marketing strategies and execute our research and development plan. Our research and development efforts are aimed, in part, at solving increasingly complex opportunities, as well as creating new products, and we do not expect that all of our projects will be successful. If our research and development efforts are unsuccessful, our future results of operations could be materially harmed.

We face competition from other accessory and apparel manufacturers that focus on similar markets.

We face competition from companies that also focus on the concealed carry and tactical market that we have chosen to enter. These companies have longer operating histories and may have greater name recognition and substantially greater financial, technical and marketing resources than us. Many of these companies also have existing and established products, and more extensive customer bases, broader customer relationships and broader industry alliances than us, including relationships with many of our potential customers. Increased competition from any of these sources could result in our failure to achieve and maintain an adequate level of customers and market share to support the cost of our operations.

Our industry could experience greater scrutiny and regulation by governmental authorities, which may lead to greater governmental regulation in the future.

There is such rapid interest in new concealed carry products that this rapidly growing market may get the attention of government regulators and legislators. The current trend in legislation is to roll back or minimize access to firearms restrictions, but there can be no assurance that this trend will continue.

Unsuccessful product launches could have a material adverse effect on our prospects.

New businesses have a disproportionate risk that each product launch will be successful in the early days of the new business. Mature companies can better absorb the negative effects of a disappointing product launch as the mature company can be supported by their existing successful products. A new business is critically establishing their base of successful products to support their need to establish revenue, reach profitability, and satisfy their investors.

Intellectual property litigation and infringement claims could cause us to incur significant expenses or prevent us from selling certain of our products.

Extensive intellectual property litigation may be necessary to protect our patents and, from time to time, we might be the subject of claims by third parties of potential infringement or misappropriation. Regardless of outcome, such claims are expensive to prosecute and defend and divert the time and effort of our management and operating personnel from other business issues. A successful claim or claims of patent or other intellectual property infringement against us could result in our payment of significant monetary damages and/or royalty payments or negatively impact our ability to sell current or future products in the affected category and could have a material adverse effect on its business, cash flows, financial condition or results of operations.

If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed.

We plan on relying on trade secrets, including unpatented know-how, technology and other proprietary information, to maintain our competitive position. We will seek to protect these trade secrets, in part, by entering into non-disclosure and confidentiality agreements with parties who have access to them, such as our employees, corporate collaborators, outside scientific collaborators, contract manufacturers, consultants, advisors and other third parties. We will seek to protect our confidential proprietary information, in part, by entering into confidentiality and invention or patent assignment agreements with our employees and consultants. Moreover, to the extent we enter into such agreements, any of these parties may breach the agreements and disclose our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive and time-consuming, and the outcome is unpredictable. In addition, some courts inside and outside the United States are less willing or unwilling to protect trade secrets. If any of our trade secrets were to be lawfully obtained or independently developed by a competitor, we would have no right to prevent them, or those to whom they communicate it, from using that technology or information to compete with us. If any of our trade secrets were to be disclosed to or independently developed by a competitor, our competitive position would be harmed. In general, any loss of trade secret protection or other unpatented proprietary rights could harm our business, results of operations and financial condition.

If we are unable to protect our patents or other proprietary rights, or if we infringe on the patents or proprietary rights of others, our competitiveness and business prospects may be materially damaged.

We have filed for patent protection for our proprietary Protection Pocket and our SmartPhone app. We may continue to seek patent protection for our proprietary technology. Seeking patent protection is a lengthy and costly process, and there can be no assurance that patents will be issued from any pending applications, or that any claims allowed from existing or pending patents will be sufficiently broad or strong to protect our proprietary technology. There is also no guarantee that any patents we hold will not be challenged, invalidated or circumvented, or that the patent rights granted will provide competitive advantages to us. Our competitors have developed and may continue to develop and obtain patents for technologies that are similar or superior to our technologies. In addition, the laws of foreign jurisdictions in which we develop, manufacture or sell our products may not protect our intellectual property rights to the same extent, as do the laws of the United States.

Adverse outcomes in current or future legal disputes regarding patent and other intellectual property rights could result in the loss of our intellectual property rights, subject us to significant liabilities to third parties, require us to seek licenses from third parties on terms that may not be reasonable or favorable to us, prevent us from manufacturing, importing or selling our products, or compel us to redesign our products to avoid infringing third parties’ intellectual property. As a result, we may be required to incur substantial costs to prosecute, enforce or defend our intellectual property rights if they are challenged. Any of these circumstances could have a material adverse effect on our business, financial condition and resources or results of operations.

Dependence on patent and other proprietary rights and failing to protect such rights or to be successful in litigation related to such rights may result in our payment of significant monetary damages or impact offerings in our product portfolios.

Our long-term success largely depends on our ability to market innovative and appealing competitive products. If we fail to obtain or maintain adequate intellectual property protection, we may not be able to prevent third parties from using our proprietary technologies or may lose access to technologies and features critical to our products. Also, our currently pending or future patents applications may not result in issued patents, and issued patents are subject to claims concerning priority, scope and other issues.

Furthermore, to the extent we do not file applications for patents domestically or internationally, we may not be able to prevent third parties from using our proprietary technologies or may lose access to technologies critical to our products in other countries.

As a direct-to-consumer Internet-based retailer, the Company will be subject to the risks all online retailers face.

The Company employs third-party services for credit card transactions, and as operations continue the Company will continually harden its online assets and deploy additional layers of protection for its customers, its assets, and its continued operations. Consumers who are comfortable purchasing online are increasing as new consumers’ age into technology they have grown up with. Consumers who are not comfortable purchasing online are a decreasing number. There can be no assurance that consumers will continue to be comfortable with purchasing online and that the number of consumers comfortable with purchasing online will continue to increase.

The Company does not have Enterprise Risk Management controls in place.

The Company does not have the benefit of having Enterprise Risk Management controls in place and its operations and execution may suffer from the lack of such controls. Currently the Company has the benefit of its sole officer and director, CEO Andy Ross.

IN ADDITION TO THE ABOVE RISKS, BUSINESSES ARE OFTEN SUBJECT TO RISKS NOT FORESEEN OR FULLY APPRECIATED BY MANAGEMENT. IN REVIEWING THIS CURRENT REPORT ON FORM 10-K, POTENTIAL INVESTORS SHOULD KEEP IN MIND THAT THERE MAY BE OTHER POSSIBLE RISKS THAT COULD BE IMPORTANT.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

Description of Property

The Company maintains its warehouse and shipping operations at 3800 S Ross Lane, Chanute, Kansas 66720; but utilizes 718 Thompson Lane, Suite 108-199, Nashville, TN 37204 as its primary address. The Company also operates a sales office at 8460 Nieman Road, Lenexa, Kansas 66214. The lease agreement at 3800 S Ross Lane, Chanute, Kansas 66720, is in the name of American Rebel Holdings, Inc. The lease agreement at 8460 Nieman Road, Lenexa, Kansas 66214 is in the name of the wholly owned subsidiary American Rebel, Inc. American Rebel, Inc. maintains 718 Thompson Lane, Suite 108-199, Nashville, TN address. The Company believes these facilities are adequate for our needs, including providing the space and infrastructure to accommodate our development work based on our current operating plan.

ITEM 3. LEGAL PROCEEDINGS

From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm business.

We are not currently a party in any legal proceeding or governmental regulatory proceeding nor are we currently aware of any pending or potential legal proceeding or governmental regulatory proceeding proposed to be initiated against us that would have a material adverse effect on us or our business.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

PART II

ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market for our Common Stock

Our common stock is quoted on the OTC Market under the symbol “AREB.” Our common stock has traded infrequently on the OTC, which limits our ability to locate accurate high and low bid prices for each quarter during the last two fiscal years. Therefore, the following table lists the available quotations for the high and low closing prices for fiscal 2019 and 2020 obtained through Yahoo! Finance. The quotations reflect inter-dealer prices without retail mark-up, markdown, or commissions and may not represent actual transactions.

HIGH LOW HIGH LOW

On May 5, 2021, the closing price of shares of common stock of the Company was $0.069. However, we consider our common stock to be thinly traded and, as a result, any reported sales prices may not be a true market-based valuation of the common stock.

Shareholders of Record

As of May 5, 2021, an aggregate of 79,466,563 shares of our common stock were issued and outstanding and owned by 135 shareholders of record.

Dividends

We have not since December 15, 2014 (date of inception) declared or paid any cash dividends on our common stock and currently do not anticipate paying such cash dividends. We currently anticipate that we will retain all of our future earnings for use in the development and expansion of our business and for general corporate purposes. Any determination to pay dividends in the future will be at the discretion of our Board of Directors (the “Board”) and will depend upon our results of operations, financial condition, tax laws and other factors as the Board, in its discretion, deems relevant.

Securities Authorized for Issuance under Equity Compensation Plans

During the year ended December 31, 2020 we did not have any equity compensation plans. On January 1, 2021, our board of directors approved the establishment of the 2021 Long-Term Equity Incentive Plan (“LTIP”). The LTIP is intended to enable us to continue to attract able directors, employees, and consultants and to provide a means whereby those individuals upon whom the responsibilities rest for successful administration and management of the Company, and whose present and potential contributions are of importance, can acquire and maintain Common Stock ownership, thereby strengthening their concern for our welfare. The aggregate maximum number of shares of Common Stock (including shares underlying options) that may be issued under the LTIP pursuant to awards of Restricted Shares or Options will be limited to 10% of the outstanding shares of Common Stock, which calculation shall be made on the first trading day of each new fiscal year. For fiscal year 2021, up to 7,549,725 shares of Common Stock are available for participants under the LTIP. The number of shares of Common Stock that are the subject of awards under the LTIP which are forfeited or terminated, are settled in cash in lieu of shares of Common Stock or in a manner such that all or some of the shares covered by an award are not issued to a participant or are exchanged for awards that do not involve shares will again immediately become available to be issued pursuant to awards granted under the LTIP. If shares of Common Stock are withheld from payment of an award to satisfy tax obligations with respect to the award, those shares of Common Stock will be treated as shares that have been issued under the LTIP and will not again be available for issuance under the LTIP. In March of 2021, we authorized the grant and issuance of 4,290,000 shares of common stock under the LTIP.

Recent Sales of Unregistered Securities

The Company entered into an amortized one-year promissory note on August 5, 2020, to a lender for $150,000 at 12% interest. A component of the note included 230,769 shares of common stock valued at $0.065. Additionally, the Company has issued 1,153,846 shares of common stock, valued at $0.065. Upon full repayment of the loan, 1,153,846 shares of common stock will be returned to the Company.

On September 30, 2020, the Company entered into an amortized one-year promissory note to a lender for $350,000 at 12% interest. A stipulation of this promissory note was that the Company pay in full the July 31, 2020, $150,000 promissory note. A component of the note included 1,458,333 shares of common stock valued at $0.035. Additionally, the Company has issued 1,605,475 shares of common stock, valued at $0.035. Upon full repayment of the loan, 1,605,475 shares will be returned to the Company.

On October 1, 2020, the Company entered into a three-month promissory note with a lender for $250,000 at 8% interest. A component of the note is the issuance of 1,250,000 five-year warrants to purchase the Company’s common stock at $0.10 per share.

On October 6, 2020, the Company entered into a one-year note with a lender for $100,000 at 12% interest. A component of the note was the issuance of 1,000,000 shares of common stock of the Company valued at $0.10 per share.

On October 13, 2020, the Company refinanced an existing note into a one-year note with a lender for $200,000 at 12% interest. A component of the note was the issuance of 2,000,000 shares of common stock of the Company valued at $0.10 per share.

On October 13, 2020, the Company issued 300,000 shares of common stock of the Company valued at $0.10 per share as an interest payment on an outstanding note.

On October 21, 2020, the Company entered into a six-month promissory note with a lender for $250,000 at 8% interest. A component of the note is the issuance of 1,250,000 five-year warrants to purchase the Company’s common stock at $0.10 per share.

On November 5, 2020, the Company issued 310,000 shares of common stock of the Company valued at $0.10 per share as an interest payment on an outstanding note.

On November 25, 2020, the Company issued 4,000,000 shares of common stock of the Company valued at $0.10 per share as components of promissory notes.

On November 25, 2020, the Company issued 1,500,000 shares of common stock of the Company valued at $0.10 per share as a component of a consulting agreement.

On December 4, 2020, the Company issued 300,000 shares of common stock of the Company valued at $0.10 per share as an interest payment on an outstanding note.

Subsequent Issuances after Year-End

On January 5, 2021, the Company issued 310,000 shares of common stock of the Company valued at $0.06 per share as an interest payment on an outstanding note.

On January 12, 2021, the Company sold 833,333 shares of common stock for $50,000, $0.06 per share, to a third-party accredited investor.

On March 4, 2021, the Company entered into a one-year promissory note in the amount of $50,000 and issued the noteholder 600,000 shares of common stock.

On March 5, 2021, the Company sold 1,666,667 shares of common stock for $100,000, $0.06 per share, to a third-party accredited investor.

On March 10, 2021, the Company issued 319,313 shares of common stock of the Company valued at $0.06 per share as payment for services rendered.

On March 10, 2021, the Company issued 280,000 shares of common stock of the Company valued at $0.06 per share as an interest payment on an outstanding note.

On March 10, 2021, the Company issued 310,000 shares of common stock of the Company valued at $0.06 per share as an interest payment on an outstanding note.

On March 24, 2021, pursuant to our 2021 Long-Term Incentive Plan, we authorized the issuance of 2,145,000 shares of common stock to Doug E. Grau, our president, for services. Such shares will be issued only upon the amendment to the Company’s articles of incorporation to increase its authorized shares of common stock.

On March 24, 2021, pursuant to our 2021 Long-Term Incentive Plan, we authorized the issuance of 2,145,000 shares of common stock to Charles A. Ross, Jr., our CEO, for services. 2,045,000 of such shares will be issued only upon the amendment to the Company’s articles of incorporation to increase its authorized shares of common stock.

On March 24, 2021, we authorized the issuance of 2,500,000 shares of common stock to Gurkha Consulting, a company controlled by Rocco LaVista, our newly appointed VP of Business Development, as consideration of the termination of such consultant’s services and to relieve us from certain ongoing compensation commitments. Such shares will be issued only upon the amendment to the Company’s articles of incorporation to increase its authorized shares of common stock.

On April 9, 2021, in connection with a $1,000,000 bridge loan, we issued Ronald A. Smith, our COO and chairman, a warrant to purchase 2,000,000 shares of the Company’s common stock at an exercise price of $0.10 per share with a five-year term.

On April 9, 2021, we entered into an employment agreement with Ronald A. Smith, our COO and chairman, and authorized the issuance of 4,750,000 shares of common stock to Mr. Smith. Such shares will be issued only upon the amendment to the Company’s articles of incorporation to increase its authorized shares of common stock.

On April 9, 2021, we entered into an employment agreement with Rocco LaVista, our VP of Business Development, and authorized the issuance of 4,000,000 shares of common stock to Mr. LaVista. Such shares will be issued only upon the amendment to the Company’s articles of incorporation to increase its authorized shares of common stock.

On April 9, 2021, we entered into an amendment to the employment agreement with Charles A. Ross, Jr., our CEO, and authorized the issuance of 4,000,000 shares of common stock to Mr. Ross. Such shares will be issued only upon the amendment to the Company’s articles of incorporation to increase its authorized shares of common stock.

On April 9, 2021, we entered into an amendment to the employment agreement with Doug E. Grau, our President, and authorized the issuance of 4,000,000 shares of common stock to Mr. Grau. Such shares will be issued only upon the amendment to the Company’s articles of incorporation to increase its authorized shares of common stock.

On April 20, 2021, the Company issued 50,000 shares of common stock valued at $0.06 per share as payment for services rendered.

On April 22, 2021, we issued 2,000,000 shares of common stock, with a stated value of $100,687.97, as part of the settlement of a secured note.

All of the above-described issuances were exempt from registration pursuant to Section 4(a)(2) and/or Regulation D of the Securities Act as transactions not involving a public offering. With respect to each transaction listed above, no general solicitation was made by either the Company or any person acting on its behalf. All such securities issued pursuant to such exemptions are restricted securities as defined in Rule 144(a)(3) promulgated under the Securities Act, appropriate legends have been placed on the documents evidencing the securities, and may not be offered or sold absent registration or pursuant to an exemption there from.

Repurchase of Equity Securities

We have no plans, programs or other arrangements in regards to repurchases of our common stock. Further, we did not repurchase any of our equity securities during the year ended December 31, 2020

ITEM 6. SELECTED FINANCIAL DATA

Not applicable to smaller reporting companies.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-looking statements: Statements about our future expectations are “forward-looking statements” and are not guarantees of future performance. When used herein, the words “may,” “should,” “anticipate,” “believe,” “appear,” “intend,” “plan,” “expect,” “estimate,” “approximate,” and similar expressions are intended to identify such forward-looking statements. These statements involve risks and uncertainties inherent in our business, including those set forth under the caption “Risk Factors,” in this Report, and are subject to change at any time. Our actual results could differ materially from these forward-looking statements. This Annual Report on Form 10-K does not have any statutory safe harbor for this forward-looking statement. We undertake no obligation to update publicly any forward-looking statements.

Management’s Discussion and Analysis should be read in conjunction with the financial statements included in this Annual Report on Form 10-K (the “Financial Statements”). The financial statements have been prepared in accordance with generally accepted accounting policies in the United States (“GAAP”). Except as otherwise disclosed, all dollar figures included therein and in the following management discussion and analysis are quoted in United States dollars.

The following discussion of the Company’s financial condition and the results of operations should be read in conjunction with the Financial Statements and footnotes thereto appearing elsewhere in this Report.

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that in addition to the description of historical facts contained herein, this report contains certain forward-looking statements that involve risks and uncertainties as detailed herein and from time to time in the Company’s other filings with the Securities and Exchange Commission and elsewhere. Such statements are based on management’s current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those, described in the forward-looking statements. These factors include, among others: (a) the Company’s fluctuations in sales and operating results; (b) risks associated with international operations; (c) regulatory, competitive and contractual risks; (d) development risks; (e) the ability to achieve strategic initiatives, including but not limited to the ability to achieve sales growth across the business segments through a combination of enhanced sales force, new products, and customer service; and (f) pending litigation.

Operations

On June 9, 2016 a change in control occurred, a sixty percent (60%) ownership interest was obtained by American Rebel, Inc. from our former officer and director and founder. On June 17, 2017, the Company acquired the business of its control stockholder accounted for and presented financially as a reverse merger transaction. Our majority stockholder, American Rebel, Inc. became a wholly owned subsidiary of the Company and we distributed shares to the stockholders of American Rebel, Inc. As a result of this reverse merger, the reported operating history of the Company is now the operating history of American Rebel, Inc. Financial statements of both companies are now consolidated and all material intercompany transactions and balances are eliminated.

We are a development stage company and have limited financial resources. We have not established a firm source of equity or debt financing. Our independent registered public accounting firm has included an explanatory paragraph in their report filed on March, 2021 and included with our Form 10-K emphasizing the uncertainty of our ability to remain as a going concern. An investor or financial statement reader should read our Risk Factors in full.

Description of Business

Company Overview

American Rebel is boldly positioning itself as America’s Patriotic Brand. The Company has identified the market opportunity to design, manufacture, and market innovative concealed carry products and safes. American Rebel accesses its market uniquely through its positioning as America’s Patriotic Brand and the appeal of its products as well as through the profile and public persona of its founder and CEO, Andy Ross. Andy hosted his own television show for 12 years, has made multiple appearances over the years at trade shows, and is well-known in the archery world as the founder of Ross Archery, which was the world’s fastest-growing bow company in 2007 and 2008. Andy has also released 3 CDs, done numerous radio and print interviews, and performed many concerts in front of thousands of people. Andy has the ability to present American Rebel to large numbers of potential customers through the appeal of his music and other supporting appearances. For example, his appearance on the History Channel hit show Counting Cars in February 2014 has been viewed by over 2 million people. Bringing innovative products that satisfy an existing demand to the market through exciting means is the American Rebel blueprint for success.

Other

As a corporate policy, we will not incur any cash obligations that we cannot satisfy with known resources, of which there are currently none except as described in “Liquidity” below or elsewhere in this report. We believe that the perception that many people have of a public company makes it more likely that they will accept restricted securities from a public company as consideration for indebtedness to them than they would from a private company. We have not performed any studies of this matter. Our conclusion is based on our own observations. Additionally, the issuance of restricted shares will dilute the percentage of ownership interest of our stockholders.

Results of Operations for the fiscal year ended December 31, 2020

Revenue and cost of goods sold

For the year ended December 31, 2020, we reported Sales of $1,255,703, compared to Sales of $535,109 for the year ended December 31, 2019. For the year ended December 31, 2020, we reported Cost of Sales of $952,511, compared to Cost of Sales of $379,079 for the year ended December 31, 2019. For the year ended December 31, 2020, we reported Gross Profit of $303,192, compared to Gross Profit of $156,033 for the year ended December 31, 2019. Sales of our products began during the fourth quarter of 2016.

Expenses

Total operating expenses for the year ended December 31, 2020 were $3,075,113 compared to $6,156,254 for the year ended December 31, 2019 as further described below.

For the year ended December 31, 2020, we incurred consulting and business development expenses of $529,094, compared to consulting and business development expenses of $3,809,291 for the year ended December 31, 2019. The decrease in consulting and business development expenses relates primarily to not having the expansion of activities in preparation of a 2019 product launch.

For the year ended December 31, 2020, we incurred product development expenses of $320,472, compared to product development expenses of $309,061 for the year ended December 31, 2019. The decrease in product development expenses is due to the fact that 2019 was a year of releasing product to the marketplace.

For the year ended December 31, 2020, we incurred marketing and brand development expenses of $390,294, compared to marketing and brand development expenses of $632,522 for the year ended December 31, 2019. The decrease in marketing and brand development expenses relates primarily to the benefit of the prior year’s investment in the marketing of the American Rebel brand.

For the year ended December 31, 2020, we incurred general and administrative expenses of $1,773,529, compared to general and administrative expenses of $1,343,352 for the year ended December 31, 2019. The increase relates primarily to an increase in professional, consulting and operating fees necessary to manage the growing business.

For the year ended December 31, 2020, we incurred depreciation expense of $61,724, compared to depreciation expense of $62,028 for the year ended December 31, 2019.

Other income and expenses

For the year ended December 31, 2020, we incurred interest expense of $2,292,957, compared to interest expense of $1,601,851 for the year ended December 31, 2019.

Net Loss

Net loss for the year ended December 31, 201920 amounted to $5,981,082, resulting in a loss per share of $0.10, compared to $7,602,072 for the year ended December 31, 2019, resulting in a loss per share of $0.25. The decrease in the net loss from the year ended December 31, 2019 to the year ended December 31, 2020 is primarily due to the investment in compensation that occurred in September 2019.

Liquidity

We are a development stage company and realized minimal but growing revenue from our planned operations. We have a working capital deficit of $888,280 at December 31, 2018 and $2,812,957 at December 31, 2019, and have incurred a deficit of $20,870,713 from inception to December 31, 2020. We have funded operations primarily through the issuance of capital stock, convertible debt and other securities.

During the year ended December 31, 2020, we raised net cash of $- by issuance of common shares, as compared to $3,500 for the year ended December 31, 2019. During the year ended December 31, 2020, we raised net cash of $2,869,171 through the issuance of promissory notes secured by specific inventory, as compared to $3,105,441 for the year ended December 31, 2019. During the year ended December 31, 2020, we repaid $0 on loans received from our CEO, as compared to $12,092 that we repaid on loans from our CEO during the year ended December 31, 2019.

As we proceed with the launch of our American Rebel concealed carry product and safe lines we have devoted and expect to continue to devote significant resources in the areas of capital expenditures and marketing, sales, and operational expenditures.

We expect to require additional funds to further develop our business plan, including the anticipated launch of additional products in addition to the launch of our concealed carry product line. Since it is impossible to predict with certainty the timing and amount of funds required to establish profitability, we anticipate that we will need to raise additional funds through equity or debt offerings or otherwise in order to meet our expected future liquidity requirements. Any such financing that we undertake will likely be dilutive to existing stockholders.

In addition, we expect to also need additional funds to respond to business opportunities and challenges, including our ongoing operating expenses, protecting our intellectual property, developing or acquiring new lines of business and enhancing our operating infrastructure. While we may need to seek additional funding for such purposes, we may not be able to obtain financing on acceptable terms, or at all. In addition, the terms of our financings may be dilutive to, or otherwise adversely affect, holders of our common stock. We may also seek additional funds through arrangements with collaborators or other third parties. We may not be able to negotiate any such arrangements on acceptable terms, if at all. If we are unable to obtain additional funding on a timely basis, we may be required to curtail or terminate some or all of our product lines.

Critical Accounting Policies

The preparation of financial statements and related footnotes requires us to make judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities.

An accounting policy is considered to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the financial statements.

Financial Reporting Release No. 60 requires all companies to include a discussion of critical accounting policies or methods used in the preparation of financial statements. There are no critical policies or decisions that rely on judgments that are based on assumptions about matters that are highly uncertain at the time the estimate is made. Note 1to the financial statements, included elsewhere in this report, includes a summary of the significant accounting policies and methods used in the preparation of our financial statements.

Emerging Growth Company - We qualify as an “emerging growth company” under the recently enacted Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, among other things, we will not be required to:

·Have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;

·Submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency”

·Obtain shareholder approval of any golden parachute payments not previously approved; and

·Disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executives compensation to median employee compensation.

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.

We will remain an “emerging growth company” until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion; (ii) the fifth anniversary of our first sale of common equity pursuant to an effective registration statement; (iii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that are held by non-affiliates exceeds $700 million as of the last business day of our most recently completed third fiscal quarter; or (iv) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period.

Recent Pronouncements

The Company evaluated recent accounting pronouncements through December 31, 2020 and believes that none have a material effect on the Company’s financial statements except for the following.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The objective of ASU 2016-02 is to recognize lease assets and lease liabilities by lessees for those leases classified as operating leases under previous U.S. GAAP. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of ASU 2016-02 is permitted. The Company is evaluating the effects adoption of this guidance will have on its consolidated financial statements.

In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260)-Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The amendments in Part I of the ASU change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments in Part II recharacterize the indefinite deferral of certain provisions of Topic 480 with a scope exception and do not have an accounting effect. The ASU is effective for annual periods beginning after December 15, 2018, and interim periods within those annual periods. The Company is evaluating the effects adoption of this guidance will have on its consolidated financial statements.

In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815)-Targeted Improvements to Accounting for Hedging Activities. The new guidance is intended to more closely align hedge accounting with entities’ hedging strategies, simplify the application of hedge accounting, and increase the transparency of hedging programs. The ASU is effective for annual periods beginning after December 15, 2018, and interim periods within those annual periods. The Company is evaluating the effects adoption of this guidance will have on its consolidated financial statements.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

AMERICAN REBEL HOLDINGS, INC.

DECEMBER 31, 2020

Page

Report of Independent Registered Public Accounting Firm F-1

Financial Statements for the years ended December 31, 2020 and December 31, 2019

Balance Sheets F-2

Statements of Operations F-3

Statement of Stockholders’ Equity (Deficit) F-4

Statements of Cash Flows F-5

American Rebel Holdings Inc AREB US Equity

AREB · 10-K · period ended 2020-12-31

ITEM 1. BUSINESS

ITEM 1A. RISK FACTORS

ITEM 1B. UNRESOLVED STAFF COMMENTS

ITEM 2. PROPERTIES

ITEM 3. LEGAL PROCEEDINGS

ITEM 4. MINE SAFETY DISCLOSURES

ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

ITEM 6. SELECTED FINANCIAL DATA

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

American Rebel Holdings Inc AREB US Equity☆

AREB · 10-K · period ended 2020-12-31

ITEM 1. BUSINESS

ITEM 1A. RISK FACTORS

ITEM 1B. UNRESOLVED STAFF COMMENTS

ITEM 2. PROPERTIES

ITEM 3. LEGAL PROCEEDINGS

ITEM 4. MINE SAFETY DISCLOSURES

ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

ITEM 6. SELECTED FINANCIAL DATA

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

American Rebel Holdings Inc AREB US Equity