NEWH 10-Q Quarterly Report June 30, 2012

BIOSOLAR INC

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10-Q 1 form10q.htm BIOSOLAR INC FORM 10-Q form10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2012

¨ TRANSITION REPORT UNDER SECTION13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM __________ TO __________

COMMISSION FILE NUMBER: 333-138910

BIOSOLAR, INC.

(Name of registrant in its charter)

Nevada		20-4754291
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

27936 Lost Canyon Road, Suite 202 , Santa Clarita, CA 91387

(Address of principal executive offices) (Zip Code)

Issuer’s telephone Number: (661) 251-0001

WITH COPIES TO:

Gregory Sichenzia, Esq.

Marcelle S. Balcombe, Esq.

Sichenzia Ross Friedman Ference LLP

61 Broadway, 32 nd Flr.

New York, New York 10006

(212) 930-9700

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate 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 o

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

Large accelerated filer o	Accelerated filer o
Non-accelerated filer o	Smaller reporting company x

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

The number of shares of registrant’s common stock outstanding, as of July 31, 2012 was 6,284,413.

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BIOSLAR, INC.

INDEX

PART I: FINANCIAL INFORMATION
ITEM 1:	FINANCIAL STATEMENTS (Unaudited)	3
	Balance Sheets	3
	Statements of Operations	4
	Statement of Shareholders' Equity	5
	Statements of Cash Flows	6
	Notes to the Financial Statements	7
ITEM 2:	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	10
ITEM 3 :	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	13
ITEM 4:	CONTROLS AND PROCEDURES	13
PART II: OTHER INFORMATION
Item 1	LEGAL PROCEEDINGS	14
ITEM 1A :	RISK FACTORS	14
ITEM 2	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	14
ITEM 3	DEFAULTS UPON SENIOR SECURITIES	14
ITEM 4	MINE SAFETY DISCLOSURES	14
ITEM 5	OTHER INFORMATION	14
ITEM 6:	EXHIBITS	15
SIGNATURES		16

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PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

BIOSOLAR, INC.

(A Development Stage Company)

BALANCE SHEETS

	June 30, 2012			December 31, 2011
	(Unaudited)
ASSETS

CURRENT ASSETS
Cash	$	74,162		$	52,422
Prepaid expenses		20,283			30,797

TOTAL CURRENT ASSETS		94,445			83,219

PROPERTY AND EQUIPMENT
Machinery and equipment		78,864			76,281
Computer		2,928			2,928
		81,792			79,209
Less accumulated depreciation		(30,692	)		(26,698	)

NET PROPERTY AND EQUIPMENT		51,100			52,511

OTHER ASSETS
Patents, net of amortization of $40		142,008			140,927
Deposit		770			770

TOTAL OTHER ASSETS		142,778			141,697

TOTAL ASSETS	$	288,323		$	277,427



LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
Accounts payable	$	7,915		$	4,377
Accrued expense		104,517			13,145

TOTAL CURRENT LIABILITIES		112,432			17,522

SHAREHOLDER'S EQUITY
Common stock, $0.0001 par value;
500,000,000 authorized common shares
6,239,413 and 5,536,164 shares issued and outstanding, respectively		623			554
Additional paid in capital		5,450,670			5,040,120
Deficit accumulated during the development stage		(5,275,402	)		(4,780,769	)

TOTAL SHAREHOLDERS' EQUITY		175,891			259,905

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	288,323		$	277,427

The accompanying notes are an integral part of these financial statements

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BIOSOLAR, INC.

(A Development Stage Company)

STATEMENTS OF OPERATIONS

(Unaudited)

													From Inception
													April 24, 2006
	Three Months Ended						Six Months Ended						through
	June 30, 2012			June 30, 2011			June 30, 2012			June 30, 2011			June 30, 2012

REVENUE	$	-		$	-		$	-		$	-		$	-

OPERATING EXPENSES
General and administrative expenses		176,716			316,240			452,728			512,830			4,557,222
Research and development		3,741			8,670			37,735			21,857			773,565
Depreciation and amortization		2,008			2,034			3,994			4,030			30,732

TOTAL OPERATING EXPENSES		182,465			326,944			494,457			538,717			5,361,519

LOSS FROM OPERATIONS BEFORE OTHER INCOME/(EXPENSES)		(182,465	)		(326,944	)		(494,457	)		(538,717	)		(5,361,519	)

TOTAL OTHER INCOME/(EXPENSES)
Interest income		5			58			14			58			87,249
Penalties		-			-			-			-			(180	)
Interest expense		-			(229	)		(190	)		(458	)		(952	)

TOTAL OTHER INCOME/(EXPENSES)		5			(171	)		(176	)		(400	)		86,117


NET LOSS	$	(182,460	)	$	(327,115	)	$	(494,633	)	$	(539,117	)	$	(5,275,402	)


BASIC AND DILUTED LOSS PER SHARE	$	(0.03	)	$	(0.06	)	$	(0.08	)	$	(0.10	)

WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING
BASIC AND DILUTED		6,110,971			5,364,707			5,978,707			5,301,367

The accompanying notes are an integral part of these financial statements

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BIOSOLAR, INC.

(A Development Stage Company)

STATEMENTS OF SHAREHOLDERS’ EQUITY



										Deficit
										Accumulated
							Additional			during the
	Common stock						Paid-in			Development
	Shares			Amount			Capital			Stage			Total
Balance at December 31, 2011		5,536,164		$	554		$	5,040,120		$	(4,780,769	)	$	259,905

Issuance of common shares for cash
(prices ranging between $0.55 and $0.70 per share) (unaudited)		369,412			36			229,764			-			229,800

Issuance of commn stock for warrants through a cashless exercise (unaudted)		332,602			33			(33	)		-			-

Issuance of common stock for subscription receivable
(price of $0.66 per share) (unaudited)		18,812			2			12,414			-			12,416

Cancellation of subscription receivable (unaudited)		(17,577	)		(2	)		(11,599	)		-			(11,601	)

Stock compensation cost (unaudited)		-			-			180,004			-			180,004

Net loss for the six months ended June 30, 2012 (unaudited)		-			-			-			(494,633	)		(494,633	)

Balance at June 30, 2012 (unaudited)		6,239,413		$	623		$	5,450,670		$	(5,275,402	)	$	175,891

The accompanying notes are an integral part of these financial statements

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BIOSOLAR, INC.

(A Development Stage Company)

STATEMENTS OF CASH FLOWS

(Unaudited)


							From Inception
							April 24, 2006
	Six Months Ended						through
	June 30, 2012			June 30, 2011			June 30, 2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(494,633	)	$	(539,117	)	$	(5,275,402	)
Adjustment to reconcile net loss to net cash
used in operating activities
Depreciation expense		3,994			4,030			30,732
Issuance of stock for services		-			-			325,262
Stock compensation cost		180,004			158,880			614,249
Changes in Assets and Liabilities
(Increase) Decrease in:
Inventory		-			-			-
Prepaid expenses		10,514			(14,137	)		(20,283	)
Deposits		-			-			(770	)
Increase (Decrease) in:
Accounts payable		3,538			5,042			7,915
Accrued expenses		91,372			-			104,517

NET CASH USED IN OPERATING ACTIVITIES		(205,211	)		(385,302	)		(4,213,780	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of equipment		(2,583	)		-			(81,792	)
Patent expenditures		(1,081	)		(16,754	)		(142,048	)

NET CASH USED IN INVESTING ACTIVITIES		(3,664	)		(16,754	)		(223,840	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from common stock subscription payable		-			-			203,000
Proceeds from issuance of common stock		230,615			441,000			4,308,782

NET CASH PROVIDED IN FINANCING ACTIVITIES		230,615			441,000			4,511,782

NET INCREASE IN CASH		21,740			38,944			74,162

CASH, BEGINNING OF PERIOD		52,422			44,318			-

CASH, END OF PERIOD	$	74,162		$	83,262		$	74,162

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest paid	$	190		$	229		$	-
Taxes paid	$	-		$	-		$	-

SUPPLEMENTAL SCHEDULE OF NON-CASH TRANSACTIONS
Common stock issued for prepaid services	$	-		$	-		$	5,867

During the six months ended June 30, 2012, the Company issued 332,602 shares of common stock for warrants through a cashless exercise.
Also, the Company issued 18,812 shares of common stock for a subscription receivable, of which 17,577 was overstated and unsubscribed.

The accompanying notes are an integral part of these financial statements

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BIOSOLAR, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS-UNAUDITED

June 30, 2012

1.	Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all normal recurring adjustments considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012. For further information refer to the financial statements and footnotes thereto included in the Company's Form 10-K for the year ended December 31, 2011.

Going Concern

The accompanying financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. The accompanying financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern. To date the Company has not generated any revenues, and has negative cash flows from operations, which raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern and appropriateness of using the going concern basis is dependent upon, among other things, additional cash infusion. The Company has obtained funds from its shareholders since its inception. It is Management's plan to generate additional working capital from investors, and then continue to pursue its business plan and purposes.

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies of Biosolar, Inc. is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.

Development Stage Activities and Operations

The Company is in its initial stages of formation and has insignificant revenues. A development stage activity is one in which all efforts are devoted substantially to establishing a new business and even if planned principal operations have commenced, revenues are insignificant.

Revenue Recognition

The Company will recognize revenue when services are performed, and at the time of shipment of products, provided that evidence of an arrangement exists, title and risk of loss have passed to the customer, fees are fixed or determinable, and collection of the related receivable is reasonably assured. To date, the Company has had no revenues and is in the development stage.

Cash and Cash Equivalent

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

Investments

Certificate of Deposits with banking institutions are short-term investments with initial maturities of more than 90 days. The carrying amount of these investments is a reasonable estimate of fair value due to their short-term nature.

Loss per Share Calculations

Loss per Share calculates basic earnings per share and diluted earnings per share. Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares available. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company’s diluted loss per share is the same as the basic loss per share for the six months ended June 30, 2012 as the inclusion of any potential shares would have had an anti-dilutive effect due to the Company generating a loss.

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BIOSOLAR, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS-UNAUDITED

June 30, 2012

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Recently Issued Accounting Pronouncements

Management reviewed accounting pronouncements issued during the six months ended June 30, 2012, and no pronouncements were adopted during the period which would have a material effect on the accompanying financial statements.

3.	CAPITAL STOCK

During the six months ended June 30, 2012, the Company issued 37,880 shares of common stock at a price of $0.66 per share for cash of $25,000; issued 18,812 shares of common stock for a subscription receivable in the amount of $12,416 during the period ended March 31,2012, of which $11,601 was refunded to the investor and 17,577 shares of common stock were cancelled during the period ended June 30, 2012. The remaining 1,235 shares of common stock were purchased at a price of $0.66 per share for cash of $815. In addition the Company issued 149,714 shares of common stock at a price of $0.70 per share for cash of $104,799; Also, through a cashless exercise of a warrant, the Company issued 332,602 shares of common stock.

During the six months ended June 30, 2011, the Company issued 28,986 shares of common stock at a price of $1.725 per share for cash of $50,000, with warrants attached to purchase 57,971 shares of common stock; issued 164,444 shares of common stock at a price of $2.25 per share for cash of $370,000, with warrants attached to purchase 88,889 shares of common stock; issued 10,000 shares of common stock at a price of $2.10 per share for cash of $21,000.

4.	STOCK OPTIONS AND WARRANTS

On March 24, 2011, the Board of Directors of the Company granted non-qualified stock options to purchase 236,667 shares of common stock to its employees, directors and consultants. Notwithstanding any other provisions of the Option agreement, each Option expires on the date specified in the Option agreement, which date shall not be later than the fifth (5 th ) anniversary from the grant date of the options. The stock options vest at various times, and are exercisable at an exercise price of $4.05 per share, the market value of the Company’s common stock on the date of grant.

Risk free interest rate		2.14	%
Stock volatility factor		1	%
Weighted average expected option life	5 years
Expected dividend yield	None

A summary of the Company’s stock option activity and related information follows:

	6/30/2012
			Weighted
	Number		average
	of		exercise
	Options		price
Outstanding, beginning of period		236,667	$	4.05
Granted		-		-
Exercised		-		-
Expired		-		-
Outstanding, end of period		236,667	$	4.05
Exercisable at the end of period		195,186	$	3.15
Weighted average fair value of
options granted during the period			$	-

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BIOSOLAR, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS-UNAUDITED

June 30, 2012

4.	STOCK OPTIONS AND WARRANTS (Continued)

The weighted average remaining contractual life of options outstanding as of June 30, 2012 was as follows:

			Weighted
			Average
	Stock	Stock	Remaining
Exercisable	Options	Options	Contractual
Prices	Outstanding	Exercisable	Life (years)
$4.050	236,667	195,186	3.73

The stock-based compensation expense recognized in the statement of operations during the six months ended June 30, 2012, related to the granting of these options is $180,004.

Warrants

During the six months ended June 30, 2012, the Company granted warrants to purchase 239,394 shares of common stock exercisable at a price between $0.55 and $0.70 per share within five years from the date of grant. The warrants were attached to 119,698 shares of common stock purchased through a private placement. Through a cashless exercise, 664,036 warrants were exercised to purchase 332,602 shares of common stock. As of June 30, 2012, 95,000 warrants were outstanding.

5.	SUBSEQUENT EVENT

Management has evaluated subsequent events according to the requirements of ASC TOPIC 855, and reported the following:

On July 16, 2012, the Company received funds in the amount of $24,750, to purchase 45,000 shares of common stock at a price per share of $0.55.

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I TEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Special Note on Forward-Looking Statements.

Certain statements in “Management’s Discussion and Analysis or Plan of Operation” below, and elsewhere in this quarterly report, are not related to historical results, and are forward-looking statements. Forward-looking statements present our expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements frequently are accompanied by such words such as “may,” “will,” “should,” “could,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” or the negative of such terms or other words and terms of similar meaning. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, achievements, or timeliness of such results. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of such forward-looking statements. We are under no duty to update any of the forward-looking statements after the date of this report. Subsequent written and oral forward looking statements attributable to us or to persons acting in our behalf are expressly qualified in their entirety by the cautionary statements and risk factors set forth in our annual report on Form 10-K filed with the Securities and Exchange Commission on March 29, 2012, and in other reports filed by us with the SEC.

You should read the following description of our financial condition and results of operations in conjunction with the financial statements and accompanying notes included in this report.

Overview

We are developing an innovative technology to produce bio-based materials from renewable plant sources that will reduce the cost per watt of Photovoltaic solar modules. Most of the solar industry is focused on photovoltaic efficiency to reduce cost, but we are introducing a new dimension of cost reduction by replacing petroleum-based plastic solar module components with durable bio-based components. The process for producing electricity from sunlight is known as Photovoltaics. Photovoltaic ("PV") is the science of capturing and converting sun light into electricity.

We are focusing our research and product development efforts on producing bio-based components that meet the thermal and durability requirements of current PV solar module manufacturing processes for conventional crystalline cell designs as well as thin film PV devices in an effort to capitalize on what we perceive as cost advantages to current petroleum based PV solar module components.

We are focusing our research and product development efforts on bio-based backsheets, substrates, superstrates, module, and panel components.

We were incorporated in the State of Nevada on April 24, 2006, as BioSolar Labs, Inc. Our name was changed to BioSolar, Inc. on June 8, 2006. Our principal executive offices are located at 27936 Lost Canyon Road, Suite 202, Santa Clarita, California 91387, and our telephone number is (661) 251-0001. Our fiscal year end is December 31.

Application of Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to impairment of property, plant and equipment, intangible assets, deferred tax assets and fair value computation using the Black Scholes option pricing model. We base our estimates on historical experience and on various other assumptions, such as the trading value of our common stock and estimated future undiscounted cash flows, that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions; however, we believe that our estimates, including those for the above-described items, are reasonable.

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Use of Estimates

In accordance with accounting principles generally accepted in the United States, management utilizes estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. These estimates and assumptions relate to recording net revenue, collectibility of accounts receivable, useful lives and impairment of tangible and intangible assets, accruals, income taxes, inventory realization, stock-based compensation expense and other factors. Management believes it has exercised reasonable judgment in deriving these estimates. Consequently, a change in conditions could affect these estimates.

Fair Value of Financial Instruments

Our cash, cash equivalents, investments, inventory, prepaid expenses, and accounts payable are stated at cost which approximates fair value due to the short-term nature of these instruments.

Recently Issued Accounting Pronouncements

Management reviewed accounting pronouncements issued during the three months ended June 30, 2012 and no pronouncements were adopted during the period that would have a material impact on our financial statments.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JUNE 30, 2012 COMPARED TO THE THREE MONTHS ENDED JUNE 30, 2011

OPERATING EXPENSES

General and Administrative Expenses

General and administrative (“G&A”) expenses decreased by $(139,524) to $176,716 for the three months ended June 30, 2012, compared to $316,240 for the prior period June 30, 2011. This decrease in G&A expenses was the result of a decrease in non-cash stock compensation expense of $(91,273) and a decrease in public relations expense of $(46,028) as well as an overall decrease in other expenses of $(2,223).

Research and Development

Research and Development (“R&D”) expenses decreased by $(4,929) to $3,741 for the three months ended June 30, 2012, compared to $8,670 for the prior period June 30, 2011. This overall decrease in R&D expenses was the result of a decrease in consulting fees.

Net Loss

Our Net Loss decreased by $(144,655) to $(182,460) for the three months ended June 30, 2012, compared to $(327,115) for the prior period June 30, 2011. The decrease in Net Loss was due to the overall decrease in non-cash stock compensation expense, and the overall decrease in operating expenses. Currently, the Company is in its development stage and has no revenues.

RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 2012 COMPARED TO THE SIX MONTHS ENDED JUNE 30, 2011

OPERATING EXPENSES

General and Administrative Expenses

General and administrative (“G&A”) expenses decreased by $(60,102) to $452,728 for the six months ended June 30, 2012, compared to $512,830 for the prior period June 30, 2011. This decrease in G&A expenses was the result of an increase in non-cash stock compensation expense of $21,124 and a decrease in public relations of $(78,321), and an overall decrease in G&A expenses of $(2,905).

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Research and Development

Research and Development (“R&D”) expenses increased by $15,878 to $37,735 for the six months ended June 30, 2012, compared to $21,857 for the prior period June 30, 2011. This overall increase in R&D expenses was the result of an increase in materials and supplies for samples and testing the product.

Net Loss

Our Net Loss decreased by $(44,484) to $(494,633) for the six months ended June 30, 2012, compared to $(539,117) for the prior period June 30, 2011. The increase in Net Loss was due to an increase in non-cash stock compensation expense of $21,124 and an overall decrease in operating expenses of $(65,608). Currently the Company is in its development stage and has no revenues.

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2012, we had $(17,987) of working capital deficit as compared to $65,697 for the year ended December 31, 2011. This decrease of $(83,684) was due primarily to an overall increase in accounts payable and accrued expenses.

During the six months ended June 30, 2012, the Company used $(205,211) of cash for operating activities, as compared to $(385,302) for the prior period June 30, 2011. The decrease of $(180,091) in the use of cash for operating activities was primarily due to an overall decrease in net loss, prepaid expenses, and accounts payable, with an increase in accrued expenses.

Cash used in investing activities for the six months ended June 30, 2012 was $(3,664), as compared to $(16,754) for the prior period ended June 30, 2011. The decrease of $(13,090) in investing activities was due primarily to a decrease in patent expenditures in the current period compared to the prior period.

Cash provided from financing activities was $230,615 for the six months ended June 30, 2012, as compared to $441,000 for the prior period ended June 30, 2011. Our capital needs have primarily been met from the proceeds of private placements, as we are currently in the development stage and have no revenues.

Our financial statements as of June 30, 2012 have been prepared under the assumption that we will continue as a going concern from inception (April 24, 2006) through June 30, 2012. Our independent registered public accounting firm has issued their report dated March 29, 2012 that included an explanatory paragraph expressing substantial doubt in our ability to continue as a going concern without additional capital becoming available. Our ability to continue as a going concern ultimately is dependent on our ability to generate a profit which is dependent upon our ability to obtain additional equity or debt financing, attain further operating efficiencies and, ultimately, to achieve profitable operations. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

PLAN OF OPERATION AND FINANCING NEEDS

We are engaged in the development of an innovative technology to produce bio-based materials from renewable plant sources that will reduce the cost per watt of Photovoltaic solar modules.

Our plan of operation within the next twelve months is to commercialize our bio-based backsheet component (BioBacksheet TM ) to replace the petroleum based backsheet in crystalline photovoltaic modules. This includes high volume production in response to purchase orders from major PV panel manufacturers. In addition, we intend to further enhance test programs to determine the physical properties and characteristics that will be most suitable for the further development of biobased solar module components, and build solar modules, as we attempt to validate the commercial viability of our future products. We believe that our current cash and investment balances will be sufficient to support development activity and general and administrative expenses for the next three months. Management estimates that we will require additional cash resources during 2012, based upon our current operating plan and condition. We will be exploring additional financing alternatives, including equity and/or debt financing. There is no assurance that capital in any form would be available to us, and if available, on terms and conditions that are acceptable. If we are unable to obtain sufficient funds during the next six months, we may be forced to reduce the size of our organization, which could have a material adverse impact on, or cause us to curtail and/or cease the development of our products.

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Off-Balance Sheet Arrangements

We do not have any off balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, results of operations, liquidity or capital expenditures.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

n/a

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, we conducted an evaluation, under the supervision and with the participation of our chief executive officer and chief financial officer of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act). Based upon this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is: (i) recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms, and (ii) accumulated and communicated to our management, including our chief executive officer and chief financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There was no change to our internal control over financial reporting that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not a party to any pending legal proceeding, nor is our property the subject of a pending legal proceeding, that is not in the ordinary course of business or otherwise material to the financial condition of our business. None of our directors, officers or affiliates is involved in a proceeding adverse to our business or has a material interest adverse to our business.

ITEM 1A. RISK FACTORS

There are no material changes from the risk factors previously disclosed in the Registrant’s Form 10-K filed on March 29, 2012

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

During the three months ended June 30, 2012, the Company issued 181,818 shares of common stock at a price of $0.55 per share for cash of $100,000. The Company issued 18,812 shares of common stock for a subscription receivable in the amount of $12,416 during the period ended March 31, 2012, of which $11,601 was refunded to the investor, and 17,577 shares of common stock were cancelled during the period ended June 30, 2012. The remaining 1,235 shares of common stock were purchased at a price of $0.66 per share for cash of $815.

Also, through a cashless exercise, 164,634 purchase warrants were exercised for 82,401 shares of common stock during the three months ended June 30, 2012.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None

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ITEM 6. EXHIBITS

Exhibit No.		Description
31.1		Certification by Chief Executive Officer and Acting Chief Financial Officer pursuant to Sarbanes-Oxley Section 302 (filed herewith).

32.2		Certification by Chief Executive Officer and Acting Chief Financial Officer pursuant to 18 U.S.C. Section 1350 (filed herewith).

EX-101.INS		XBRL Instance Document

EX-101.SCH		XBRL Taxonomy Extension Schema Document

EX-101.CAL		XBRL Taxonomy Extension Calculation Linkbase

EX-101.DEF		XBRL Taxonomy Extension Definition Linkbase

EX-101.LAB		XBRL Taxonomy Extension Labels Linkbase

EX-101.PRE		XBRL Taxonomy Extension Presentation Linkbase

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SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Los Angeles, State of California, on August 3, 2012.

	BIOSOLAR

	By:	/s/ David Lee
		Chief Executive Officer (Principal Executive
		Officer ) and Acting Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

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Part I Item 1. Financial Statements Item 3. Quantitative and Qualitative Disclosures About Market Risk Item 4. Controls and Procedures Part II - Other Information Item 1. Legal Proceedings Item 1A. Risk Factors Item 2. Unregistered Sales Of Equity Securities and Use Of Proceeds Item 3. Defaults Upon Senior Securities Item 4. Mine Safety Disclosures Item 5. Other Information Item 6. Exhibits

Exhibits

31.1 Certification by Chief Executive Officer and Acting Chief Financial Officer pursuant to Sarbanes-Oxley Section 302 (filed herewith). 32.2 Certification by Chief Executive Officer and Acting Chief Financial Officer pursuant to 18 U.S.C. Section 1350 (filed herewith).

NEWH 10-Q Quarter ended June 30, 2012

Exhibits