<SEC-DOCUMENT>0001004878-12-000150.txt : 20120517
<SEC-HEADER>0001004878-12-000150.hdr.sgml : 20120517
<ACCEPTANCE-DATETIME>20120517120133
ACCESSION NUMBER: 0001004878-12-000150
CONFORMED SUBMISSION TYPE: 10-Q
PUBLIC DOCUMENT COUNT: 3
CONFORMED PERIOD OF REPORT: 20120331
FILED AS OF DATE: 20120517
DATE AS OF CHANGE: 20120517
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: TransBiotec, Inc.
CENTRAL INDEX KEY: 0001425627
STANDARD INDUSTRIAL CLASSIFICATION: PERIODICALS: PUBLISHING OR PUBLISHING AND PRINTING [2721]
IRS NUMBER: 260731818
STATE OF INCORPORATION: DE
FISCAL YEAR END: 0112
FILING VALUES:
FORM TYPE: 10-Q
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-53316
FILM NUMBER: 12850914
BUSINESS ADDRESS:
STREET 1: 3030 OLD RANCH PARKWAY, SUITE 350
STREET 2: SUITE 350
CITY: SEAL BEACH
STATE: CA
ZIP: 90740
BUSINESS PHONE: (562) 280-0483
MAIL ADDRESS:
STREET 1: 3030 OLD RANCH PARKWAY, SUITE 350
STREET 2: SUITE 350
CITY: SEAL BEACH
STATE: CA
ZIP: 90740
FORMER COMPANY:
FORMER CONFORMED NAME: IMAGINE MEDIA LTD
DATE OF NAME CHANGE: 20080130
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>form10qmar5-12.txt
<DESCRIPTION>MARCH 31, 2012 10-Q
<TEXT>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[x] Quarterly Report Pursuant To Section 13 or 15(d) of The Securities
Exchange Act Of 1934
For the quarterly period ended March 31, 2012
[ ] Transition Report Under Section 13 or 15(d) of The Securities
Exchange Act Of 1934
For the transition period from __________ to __________
Commission File Number: 000-53316
TRANSBIOTEC, INC.
--------------------------------
(Exact name of registrant as specified in its charter)
Delaware 26-0731818
------------------------------- ----------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
3030 Old Ranch Parkway, Suite 350
Seal Beach, CA 90740
---------------------------
(Address of principal executive offices, including Zip Code)
(562) 280-0483
-------------------------
(Issuer's telephone number, including area code)
Check whether the issuer (1) filed all reports required to be filed by section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [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 (ss.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 [ ] No [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a small reporting company. See
the definitions of "large accelerated filer," "accelerated filer,"
"non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the
Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] 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 [ ] No [X]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 27,887,518 shares of common stock as
of April 30, 2012.
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
Mar. 31, 2012
(unaudited) Dec. 31, 2011
-------------- -------------
ASSETS
Current assets
Cash $ 126 $ 108,019
Due from Triumph Capital 100 100
Prepaid expenses 2,420 192
---------- ----------
Total current assets 2,646 108,311
---------- ----------
Fixed assets - net 1,950 1,132
---------- ----------
Total Assets $ 4,596 $ 109,443
========== ==========
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 214,420 $ 207,660
Accrued interest payable 117,341 87,411
Notes payable - current -
related parties 191,260 191,260
Notes payable - current 106,136 86,000
Notes payable - 8%
Debenture 30,000 30,000
Related party payables 274,625 288,448
Other payables 158,006 158,006
---------- ----------
Total current liabilties 1,091,788 1,048,785
---------- ----------
Notes payable - related parties 549,263 549,263
---------- ----------
Total Liabilities 1,641,051 1,598,048
---------- ----------
Stockholders' Equity
Common stock, $.00001 par value;
100,000,000 shares authorized;
27,887,518 and 25,471,672
shares issued and outstanding
at March 31, 2012 and December
31, 2011 respectively. 279 254
Additional paid in capital 11,200,941 9,266,959
Deficit accumulated during the
development stage (12,799,549) (10,720,938)
---------- ----------
Total Imagine Media, Ltd.
stockholders' equity (1,598,329) (1,453,725)
Noncontrolling interest (38,126) (34,880)
---------- ----------
Total Stockholders' Equity (1,636,455) (1,488,605)
---------- ----------
Total Liabilities and Stockholders'
Equity $ 4,596 $ 109,443
========== ==========
The accompanying notes are an integral part of the
consolidated financial statements.
2
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<S> <C> <C> <C>
Period From
For Three Months Ended July 19, 2004
March 31, (Inception) To
2012 2011 Mar. 31, 2012
--------------- ----------- ------------------
Revenues $ - $ - $ -
--------------- ----------- ------------------
- - -
--------------- ----------- ------------------
Operating expenses:
Amortization & depreciation 152 699 75,895
General and administrative 2,031,147 119,733 11,712,386
--------------- ----------- ------------------
2,031,299 120,432 11,788,281
--------------- ----------- ------------------
Gain (loss) from operations (2,031,299) (120,432) (11,788,281)
--------------- ----------- ------------------
Other income (expense):
Gain on sale of fixed asset 4,790 - 4,790
Interest expense (35,212) (86,007) (1,010,010)
Interest expense - beneficial
conversion feature (20,136) - (90,136)
--------------- ----------- ------------------
(50,558) (86,007) (1,095,356)
--------------- ----------- ------------------
Income (loss) before provision for
income taxes (2,081,857) (206,439) (12,883,637)
Provision for income tax - - -
--------------- ----------- ------------------
Net income (loss) (2,081,857) (206,439) (12,883,637)
Less: Net (income) loss attributable
to noncontrolling interest 3,246 - 84,088
--------------- ----------- ------------------
Net income (loss) attributable
to Imagine Media, Ltd. $(2,078,611) $ (206,439) $ (12,799,549)
=============== =========== ==================
Net income (loss) per share (Imagine
Media, Ltd.)(Basic and fully diluted) $ (0.08) $ (0.02)
=============== ===========
Weighted average number of
common shares outstanding 25,496,925 12,910,083
=============== ===========
</TABLE>
The accompanying notes are an integral part of the consolidated
financial statements.
3
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<S> <C> <C> <C>
Period From
July 19, 2004
For Three Months Ended (Inception)
March 31, To
2012 2011 Mar. 31, 2012
---------------- ------------ ----------------
Cash Flows From Operating Activities:
Net income (loss) $ (2,078,611) $ (206,439) $ (12,880,391)
Adjustments to reconcile net loss
to net cash provided by (used for)
operating activities:
Amortization & depreciation 152 699 75,895
Compensatory equity issuances 1,888,871 - 8,228,188
Asset write offs 850 - 38,363
Accrued payables 17,293 186,402 2,016,795
Gain on sale of fixed asset (4,790) - (4,790)
Note pay. benefical conversion
expense 20,136 - 293,700
Original issue discount -
interest expense - - 40,000
---------------- ------------ ----------------
Net cash provided by
(used for) operating
activities (156,099) (19,338) (2,192,240)
---------------- ------------ ----------------
Cash Flows From Investing Activities:
Proceeds received on sale of
fixed asset 4,790 - 4,790
Fixed asset purchases (970) - (77,845)
---------------- ------------ ----------------
Net cash provided by
(used for) investing
activities 3,820 - (73,055)
---------------- ------------ ----------------
</TABLE>
(Continued On Following Page)
The accompanying notes are an integral part of the consolidated
financial statements.
4
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(Continued From Previous Page)
<TABLE>
<S> <C> <C> <C>
Period From
July 19, 2004
For Three Months Ended (Inception)
March 31, To
2012 2011 Mar. 31, 2012
------------------ ------------ ----------------
Cash Flows From Financing Activities:
Notes & loans payable -
borrowings 19,386 2,845 875,647
Notes & loans payable -
payments - (4,000) (38,726)
Repurchase of equity - - (250,000)
Equity issuances 25,000 - 1,678,500
------------------ ------------ ----------------
Net cash provided by
(used for) financing
activities 44,386 (1,155) 2,265,421
------------------ ------------ ----------------
Net Increase (Decrease) In Cash (107,893) (20,493) 126
Cash At The Beginning Of The Period 108,019 30,695 -
------------------ ------------ ----------------
Cash At The End Of The Period $ 126 $ 10,202 $ 126
================== ============ ================
Schedule Of Non-Cash Investing And Financing Activities
Compensatory equity issuances $ 1,888,871 $ - $ 8,228,188
Debt converted to capital $ - $ - $ 1,487,875
Supplemental Disclosure
Cash paid for interest $ 4,500 $ - $ 11,735
Cash paid for income taxes $ - $ - $ -
</TABLE>
The accompanying notes are an integral part of the consolidated
financial statements.
5
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Imagine Media, LTD. was incorporated in August 2007 in the State of
Delaware. TransBioTec Inc. was formed in the state of California in July 2004.
Effective September 19, 2011 Imagine Media, LTD. was acquired by TransBioTec,
Inc. in a transaction classified as a reverse acquisition. In January 2012
Imagine Media, LTD. changed its name to TransBioTec, Inc., resulting in a parent
company and subsidiary of the same name. The financial statements represent the
activity of TransBioTec, Inc. from July 19, 2004 forward, and the consolidated
activity of Imagine Media, LTD. and TransBioTec, Inc. from September 19, 2011
forward. Imagine Media, LTD. and TransBioTec, Inc. are hereinafter referred to
collectively as the "Company". The Company has developed and plans to market and
sell a non-invasive alcohol sensing system which includes an ignition interlock.
The Company is currently considered to be in the development stage, and has not
generated revenues from its activities.
Principles of consolidation
---------------------------
The accompanying consolidated financial statements include the accounts of
the Company and its majority owned subsidiary. All intercompany accounts and
transactions have been eliminated in consolidation.
Use of Estimates
----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Cash and cash equivalents
-------------------------
The Company considers all highly liquid investments with an original
maturity of three months or less as cash equivalents.
Accounts receivable
-------------------
The Company reviews accounts receivable periodically for collectability and
establishes an allowance for doubtful accounts and records bad debt expense when
deemed necessary. At March 31, 2012 and 2011 the Company had no balance in
accounts receivable or the allowance for doubtful accounts.
Property and equipment
----------------------
Property and equipment are recorded at cost and depreciated under straight
line methods over each item's estimated useful life.
6
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Revenue recognition
-------------------
Revenue is recognized on an accrual basis as earned under contract terms.
The Company has had no revenues to date
Advertising costs
-----------------
Advertising costs are expensed as incurred. The Company recorded no
material advertising costs during the three months ended March 31, 2012 and
2011.
Income tax
----------
The Company accounts for income taxes pursuant to ASC 740. Under ASC 740
deferred taxes are provided on a liability method whereby deferred tax assets
are recognized for deductible temporary differences and operating loss carry
forwards and deferred tax liabilities are recognized for taxable temporary
differences. Temporary differences are the differences between the reported
amounts of assets and liabilities and their tax bases. Deferred tax assets are
reduced by a valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets will not be
realized. Deferred tax assets and liabilities are adjusted for the effects of
changes in tax laws and rates on the date of enactment.
Net income (loss) per share
---------------------------
The net income (loss) per share is computed by dividing the net income
(loss) by the weighted average number of shares of common outstanding. Warrants,
stock options, and common stock issuable upon the conversion of the Company's
preferred stock (if any), are not included in the computation if the effect
would be anti-dilutive and would increase the earnings or decrease loss per
share.
Financial Instruments
---------------------
The carrying value of the Company's financial instruments, as reported in
the accompanying balance sheets, approximates fair value.
Long-Lived Assets
-----------------
In accordance with ASC 350, the Company regularly reviews the carrying
value of intangible and other long-lived assets for the existence of facts or
circumstances, both internally and externally, that may suggest impairment. If
impairment testing indicates a lack of recoverability, an impairment loss is
recognized by the Company if the carrying amount of a long-lived asset exceeds
its fair value.
Products and services, geographic areas and major customers
-----------------------------------------------------------
The Company is currently in the developmental stage and has no revenue.
7
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Stock based compensation
------------------------
The Company accounts for employee and non-employee stock awards under ASC
718, whereby equity instruments issued to employees for services are recorded
based on the fair value of the instrument issued and those issued to
non-employees are recorded based on the fair value of the consideration received
or the fair value of the equity instrument, whichever is more reliably
measurable.
Minority Interest (Noncontrolling interest)
-------------------------------------------
A subsidiary of the Company has minority members, representing ownership
interests of 2.46% at March 31, 2012. The Company accounts for these minority,
or noncontolling interests pursuant to ASC 810-10-65 whereby gains or losses in
a subsidiary with a noncontrolling interest are allocated to the noncontrolling
interest based on the ownership percentage of the noncontrolling interest, even
if that allocation results in a deficit noncontrolling interest balance.
NOTE 2. RELATED PARTY TRANSACTIONS
During the three months ended March 31, 2012 and March 31, 2011, the
Company had payables due to officers for accrued compensation of $27,445 and
$140,065 respectively.
In 2010 an officer converted $325,000 in compensation owed him into 516,750
common shares. During the year ended December 31, 2011 related party
shareholders converted $829,164 in note principal and interest and $135,000 in
compensation into 2,408,977 common shares.
NOTE 3. FIXED ASSETS
December 31 December 31 (unaudited)
2010 2011 March 31, 2012
---------------- -------------- ---------------
Automobile $ 33,383 $ 33,383 $ -
Office and Lab
Equipment 31,896 31,896 31,616
Furniture & fixtures 11,596 11,596 11,556
---------------- -------------- ---------------
76,875 76,875 43,172
Less accumulated
depreciation (74,832) (75,743) (41,222)
---------------- -------------- ---------------
Total $ 2,043 $ 1,132 $ 1,950
================ ============== ===============
Depreciation expense for the three months ended March 31, 2012 and March
31, 2011 was $152 and $699 respectively.
8
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 4. NOTES PAYABLE
December 31 (unaudited)
2010 2011 March 31, 2012
---- ---- --------------
Note payable to related party, unsecured,
due 8/3/2012, interest rate 0% $ 1,950 $ 1,950 $ 1,950
Note payable to related party, unsecured,
due 9/17/2008, convertible at holder's
option at $1 per share, interest rate 10%
plus agreed upon amounts $184,156 $ - $ -
Note payable to related party, unsecured,
due 12/15/2013, monthly interest due,
convertible at holder's option at $2.50
per share, interest rate 22.1% $150,000 $ - $ -
Note payable to related party, unsecured,
due 05/28/2009, convertible at holder's
option at $2.50 per share, original issue
discount of 20%, with interest at $444 per
day after due date $240,000 $ - $ -
Note payable to related party, unsecured,
due 07/27/2012, convertible at holder's
option at $2.50 per share, interest
rate 8% $151,929 $ - $ -
Notes payable to related party, unsecured,
due 01/29/2011, convertible at holder's
option at $2.50 per share, interest
rate 9% $ 5,000 $ - $ -
Notes payable to related party, unsecured,
due 12/31/2012, interest rate 0% $ 15,810 $ 11,810 $ 11,810
Note payable, unsecured, due 09/15/2012,
convertible at holder's option at $2.50 per
TransBioTec share, and any TransBioTec
shares then converted into Imagine
Media, LTD. shares at 7.726 shares for 1
TransBiotec share, interest rate 10% $ - $ 16,000 $ 16,000
Note payable, unsecured, due 2/8/12,
quarterly interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 30% $ - $ 10,000 $ 10,000
9
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note payable, unsecured, due 2/8/12,
quarterly interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 30% $ - $ 25,000 $ 25,000
Note payable, unsecured, due 2/17/12,
quarterly Interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 30% $ - $ 25,000 $ 25,000
Note payable, unsecured, due 2/18/12,
quarterly Interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 30% $ - $ 10,000 $ 10,000
Note payable, unsecured, due 2/8/13,
annually Interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 18% $ - $ - $ 750
Note payable, unsecured, due 2/8/13,
annually Interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 18% $ - $ - $ 1,875
Note payable, unsecured, due 2/15/13,
annually Interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 12% $ - $ - $ 2,500
Note payable, unsecured, due 2/20/13,
annually Interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 12% $ - $ - $ 3,750
Note payable, unsecured, due 2/21/13,
annually Interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 12% $ - $ - $ 2,625
Note payable, unsecured, due 3/20/13,
annually Interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 12% $ - $ - $ 5,433
Note payable, unsecured, due 3/22/13,
annually Interest due, convertible at
holder's option at $0.3235688 per IMLE
share, interest rate 12% $ - $ - $ 3,203
10
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note payable to related party, unsecured,
lien against company assets, $731,763,
5-years at 0% simple interest, due
7/1/2016, payment amounts vary each
month. $ - $726,763 $ 726,763
--------- -------- -----------
$748,845 $826,523 $ 876,659
Less current portion (594,966) (277,260) (327,396)
Long-term portion $153,879 $ 49,263 $ 549,263
======== ======== ===========
Required principal payments from December 31, 2012 forward are as follows:
2012 $ 327,396
2013 $ 185,375
2014 $ 196,881
2015 $ 123,709
2016 $ 43,298
-----------
$ 876,659
===========
Interest expense under notes payable in for the three months ended March 31,
2012 and March 31, 2011 was $23,960 and $56,177 respectively.
During the three months ended March 31, 2012 and March 31, 2011 the Company
recognized a beneficial conversion feature expense on borrowing from convertible
notes of $20,136 and none, respectively.
Convertible debenture payable to
unrelated party, unsecured, due
04/1/2009, convertible at holder's
option at $.25 per share, interest
rate 8% Default interest rate 12% $ 30,000 $ 30,000 $ 30,000
NOTE 5. INCOME TAXES
Deferred income taxes arise from the temporary differences between
financial statement and income tax recognition of net operating losses. These
loss carryovers are limited under the Internal Revenue Code should a significant
change in ownership occur.
NOTE 6. STOCK OPTIONS
The Company accounts for employee and non-employee stock options under ASC
718, whereby option costs are recorded based on the fair value of the
consideration received or the fair value of the equity instruments issued,
whichever is more reliably measurable. Unless otherwise provided for, the
11
<PAGE>
Transbiotec, Inc.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Company covers option exercises by issuing new shares.
The Company's stock option activity is described below.
Non-employee stock options
--------------------------
At the beginning of 2010 the Company had 10,000 non-employee stock options
outstanding in the Company's subsidiary TransBiotec, Inc. During 2010 the
Company granted 22,500 options for services, allowing the holder to purchase one
share of common stock per option, with 22,500 options exercisable immediately at
prices from $0.10 - $0.15 per share with the option terms expiring from January
2012 through January 2015. During 2010 no options were exercised, and no options
expired, leaving a 2010 year end outstanding balance of 32,500 non-employee
stock options. The fair value of the 22,500 options granted in 2010 was
estimated on the date of grant using the Black-Scholes option pricing model with
the following assumptions: risk free interest rate of 1.08% - 2.67%, dividend
yield of 0% expected, the Company lives of 2 - 5 years, volatility of 100%
incurred and recorded compensation expense under these stock option grants of
$53,262 in 2010. During the year ended December 31, 2011 10,000 options were
exercised, and no options expired, leaving a December 31, 2011 outstanding
balance of 22,500 non-employee stock options, exercisable at prices from $0.10 -
$0.15 per share with the option terms expiring from January 2012 through January
2015. During the three months ended March 31, 2012 no options were exercised,
and no options expired, leaving a March 31, 2012 outstanding balance of 22,500
non-employee stock options. All of these options are for the stock of the
Company's subsidiary. The parent company has no stock options outstanding. NOTE
7. GOING CONCERN
The Company has suffered recurring losses from operations and has a working
capital deficit and stockholders' deficit, and in all likelihood will be
required to make significant future expenditures in connection with continuing
marketing efforts along with general administrative expenses. These conditions
raise substantial doubt about the Company's ability to continue as a going
concern.
The Company may raise additional capital through the sale of its equity
securities, through an offering of debt securities, or through borrowings from
financial institutions or others. By doing so, the Company hopes to generate
revenues from sales of its alcohol sensing and ignition lock systems. Management
believes that actions presently being taken to obtain additional funding provide
the opportunity for the Company to continue as a going concern.
12
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Plan of
Operation
The Company was formed in August 2007 to publish and distribute Image
Magazine, a monthly guide and entertainment source for the Denver, Colorado
area. The Company generated only limited revenue and essentially abandoned its
business plan in January 2009.
In January 2012 the Company completed its acquisition of TransBiotec, Inc.
("TBT") a California corporation.
As a result of the acquisition, TBT's business is that of the Company's,
and, unless otherwise indicated, any references to the Company include the
business and operations of TBT.
The Company, now headquartered in Seal Beach, California, has developed and
patented a high technology, state-of-the-art transdermal sensor system, that
detects blood alcohol levels through a person's skin. Ethanol is produced as
alcohol is ingested and metabolized in the body. The system senses ethanol
excreted through perspiration. A person places their finger on the sensor, and
within 5-8 seconds, the sensor will detect the ethanol level. A signal can then
be sent to output devices that control the ignition in a vehicle to prevent it
from starting. The system can also communicate with other devices such as a GPS
unit, or cell phone.
The Company's system is unobtrusive, accurate, reliable, durable, low cost,
easier to use and faster than the current breathalyzer applications. The Company
has completed its beta testing of the sensor and is currently developing its
manufacturing capability.
Initially, the Company intends to offer its sensor only for commercial
vehicle applications. Later, the Company plans to market its sensor to the
public for use in automobiles, SUV's, RV's, boats and other vehicles.
The following discussion:
o summarizes the Company's plan of operation; and
o analyzes the Company's financial condition and the results of its
operations for the three months ended March 31, 2012.
This discussion and analysis should be read in conjunction with the
Company's financial statements included as an exhibit to this report.
13
<PAGE>
Plan of Operation and Capital Requirements
------------------------------------------
The Company's plan of operations is as follows:
Projected Estimated
Activity Completion Date Cost
-------- --------------- ---------
Develop relationship with initial customers
willing to work with Company in refining SOBR.
Will discount price for units sold to customers
who partner with Company in this phase. Identify
add-on features that may appeal to customers.
Complete design of printed circuit boards and
injection molding tools. Sales target of 500 units. June 2012 $160,000
Outsource manufacturing, packaging and shipping.
Complete joint venture agreement with GPS partner.
Develop add-on features such as cameras, GPS and
radio interfaces, and a fingerprint reader which
would allow the SOBR to determine the driver's
identity and blood alcohol content at the same
time. Improve production capability to 1,000
units per month. August 2012 $185,000
Improve manufacturing capability to 10,000
units per month. December 2012 $370,000
The Company will maintain its research and development efforts with a goal
of continuously improving the SOBR.
The Company's sources and (uses) of funds for the three months ended March
31, 2012 and 2011 are shown below:
Three Months ended March 31,
----------------------------
2012 2011
---- ----
Net cash provided by
(used for) operations (156,099) (19,338)
Sale of equipment 4,790 --
Purchase of equipment (970) --
Loans, net of loan repayments 19,386 (1,155)
Sale of stock 25,000 --
Cash on hand at
beginning of the period 107,893 20,493
14
<PAGE>
The Company does not have any off-balance sheet arrangements that have or
are reasonable likely to have a current or future material effect on its
financial condition, changes in financial condition, results of operations,
liquidity or capital resources.
Other than as disclosed above, the Company does not know of any trends,
demands, commitments, events or uncertainties that will result in, or that
reasonably likely to result in, the Company's liquidity increasing or decreasing
in any material way.
Other than as disclosed above, the Company does not know of any significant
changes in its expected sources and uses of cash.
Results of Operations
---------------------
The Company was formed in August 2007 and generated only limited revenue
before it effectively ceased operations in January 2009.
Material changes in the Company's Statement of Operations for the three
months ended March 31, 2012 as compared to the same period in the prior year are
discussed below:
Increase (I)
Item or Decrease (D) Reason
---- --------------- ------
Professional and Subcontractor Fee (I) Product Development Costs
Research and Product Development (I) Purchase of materials
Salary and Wages (I) Hiring two sales
representatives and a
scientist.
Travel (I) Travel required in
connection with the
acquisition of TBT.
Advertising (I) Web Site design and
marketing materials
Item 4. Controls and Procedures.
(a) The Company maintains a system of controls and procedures designed to
ensure that information required to be disclosed in reports filed or submitted
under the Securities Exchange Act of 1934, as amended ("1934 Act"), is recorded,
processed, summarized and reported, within time periods specified in the SEC's
rules and forms and to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the 1934 Act, is
accumulated and communicated to the Company's management, including its
Principal Executive and Financial Officer, as appropriate to allow timely
decisions regarding required disclosure. As of March 31, 2012, the Company's
Principal Executive and Financial Officer evaluated the effectiveness of the
design and operation of the Company's disclosure controls and procedures. Based
15
<PAGE>
on that evaluation, the Principal Executive and Financial Officer concluded that
the Company's disclosure controls and procedures were effective.
(b) Changes in Internal Controls. There were no changes in the Company's
internal control over financial reporting during the quarter ended March 31,
2012, that materially affected, or are reasonably likely to materially affect,
its internal control over financial reporting.
PART II
Item 6. Exhibits
Exhibits
31.1 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32 Certification pursuant to Section 906 of the Sarbanes-Oxley Act.
16
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRANSBIOTEC, INC.
May 16, 2012 By: /s/ Charles Bennington
-----------------------------------
Charles Bennington, Principal Executive,
Financial and Accounting Officer
17
<PAGE>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>2
<FILENAME>form10qexh31may-12.txt
<DESCRIPTION>EXHIBIT 31
<TEXT>
EXHIBIT 31
<PAGE>
CERTIFICATIONS
I, Charles Bennington, certify that;
1. I have reviewed this quarterly report on Form 10-Q of TransBiotec, Inc.;
2. Based on my knowledge, this report, does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by the report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and
have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision,
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;
c) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered
by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal control
over financial reporting that occurred during the registrant's most recent
fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to materially
affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer(s) and I have disclosed, based on
our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control over
financial reporting.
May 16, 2012 By: /s/ Charles Bennington
----------------------------------
Charles Bennington,
Principal Executive Officer
<PAGE>
CERTIFICATIONS
I, Charles Bennington, certify that;
1. I have reviewed this quarterly report on Form 10-Q of TransBiotec, Inc.;
2. Based on my knowledge, this report, does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by the report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and
have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision,
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;
c) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered
by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal control
over financial reporting that occurred during the registrant's most recent
fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to materially
affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer(s) and I have disclosed, based on
our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control over
financial reporting.
May 16, 2012 By: /s/ Charles Bennington
-----------------------------
Charles Bennington,
Principal Financial Officer
<PAGE>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>3
<FILENAME>form10qexh32may-12.txt
<DESCRIPTION>EXHIBIT 32
<TEXT>
EXHIBIT 32
<PAGE>
In connection with the Quarterly Report of TransBiotec, Inc. (the
"Company") on Form 10-Q for the period ending March 31, 2012 as filed with the
Securities and Exchange Commission (the "Report"), Charles Bennington, the
Principal Executive and Financial Officer of the Company, certifies, pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that to the best of his knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects the financial condition and results of the Company.
May 16, 2012 By: /s/ Charles Bennington
------------------------------------
Charles Bennington, Principal
Executive and Financial Officer
<PAGE>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>