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EX-32 - EXH. 32 - SOBR Safe, Inc.sept10qexh32final11-11.txt
EX-31 - EXH. 31 - SOBR Safe, Inc.sept10qexh31final11-11.txt

                                  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 September 30, 2011

|_| 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

                               IMAGINE MEDIA, LTD.
                        -------------------------------
             (Exact name of registrant as specified in its charter)

               Delaware                                 26-0731818
    -------------------------------         ------------------------------------
 (State or other jurisdiction               (I.R.S. Employer Identification No.)
  of incorporation or 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)

                           7750 N. Union Blvd., # 201
                           Colorado Springs, CO 80920
                        -------------------------------
          (Former name or former address if changed since last report)

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 [X ]

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?  [X] No [ ] State the number of shares
outstanding of each of the issuer's  classes of common equity,  as of the latest
practicable date: 12,416,462 shares of common stock as of November 15, 2011.



Imagine Media, Ltd. And Subsidiary CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) Quarter Ended September 30, 2011
Imagine Media, LTD (A Development Stage Company) CONSOLIDATED BALANCE SHEETS September 30, 2011 Dec. 31, 2010 (Unaudited) ------------- ------------------ ASSETS Current assets Cash $ 30,695 $ 8,109 Due from Triumph Capital 100 ------------- ------------- Total current assets 30,695 8,209 ------------- ------------- Fixed assets - net 2,043 5,135 ------------- ------------- Total Assets 32,738 13,344 ============= ============= LIABILITIES & STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 279,840 $ 148,401 Accrued interest payable 508,180 522,610 Notes payable - current - related parties 594,966 29,760 Notes payable - current - 22,800 Related party payables 130,565 106,450 Other payables 97,464 97,464 ------------- ------------- Total current liabilties 1,611,015 927,485 ------------- ------------- Notes payable - 8 % Debenture 30,000 Notes payable - related parties 153,879 - ------------- ------------- Total Long term liabilties 153,879 30,000 Total Liabilities 1,764,894 957,485 ------------- ------------- Stockholders' Equity Common stock, $.0001 par value; 100,000,000 shares authorized; 12,379,320 shares issued and outstanding, (9,301,369 - 2010) 930 1,380 Additional paid in capital 7,297,203 8,888,579 Treasury stock at cost (242,187) (209,062) Deficit accumulated during the development stage (9,619,537) (10,078,225) ------------- ------------- Total Imagine Stockholders' Equity (2,563,591) (1,397,328) ------------- ------------- Non Controlling interest (831,435) (453,188) ------------- ------------- Total Liabilities and Stockholders' Equity $ 32,738 $ 13,344 ============= ============= The accompanying notes are an integral part of the financial statements. 2
Imagine Media, LTD. (A Development Stage Company) CONSOLIDATED STATEMENTS OF OPERATIONS Nine Months Nine Months Ended Ended September 30, 2010 September 30, 2011 (Unaudited) (Unaudited) ------------------- --------------------- Revenues $ - $ - -------------- ------------ - - -------------- ------------ Operating expenses: Amortization & depreciation 5,534 971 Advertising - 6,500 Insurance - 3,561 Licenses,Permits and Taxes 974 Office Expense 3,460 2,256 Professional and sub contractor fees 131,047 170,663 Rent 13,900 15,300 Research and Product Development 1,350 34,618 Salary and Wages 53,262 96,778 Telephone 456 1,054 Travel and Entertainment 6,987 19,178 -------------- ------------ 215,995 351,854 -------------- ------------ Gain (loss) from operations (215,995) (351,854) -------------- ------------ Other income (expense): Interest expense (186,448) (106,838) -------------- ------------ Income (loss) before provision for income taxes (402,443) (458,692) Provision for income tax - - -------------- ------------ Net income (loss) $ (402,443) $ (458,692) ============== ============ Net income (loss) per share (Basic and fully diluted) $ (0.04) $ (0.04) ============== ============ Weighted average number of common shares outstanding 9,300,834 12,450,218 ============== ============ The accompanying notes are an integral part of the financial statements. 3
Imagine Media, LLC. (A Development Stage Company) CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Three Months Ended Ended September 30, 2010 September 30, 2011 (Unaudited) (Unaudited) ------------------ ------------------ Revenues $ - $ - -------------- ------------- - - -------------- ------------- Operating expenses: Amortization & depreciation - 198 Advertising - 4,000 Insurance 1,312 Licenses, Permits and Taxes 139 Office Expense 144 410 Professional and sub contractor fees 38,897 111,586 Rent 3,700 5,100 Research and Product Development 2,259 3,039 Salary and Wages - 69,990 Telephone - 294 Travel and Entertainment 5,737 4,747 -------------- ------------- 50,737 200,816 -------------- ------------- Gain (loss) from operations (50,737) (200,816) -------------- ------------- Other income (expense): Interest expense (62,149) (3,288) -------------- ------------- Income (loss) before provision for income taxes (112,886) (204,104) Provision for income tax - - -------------- ------------- Net income (loss) $ (112,886) $ (204,104) ============== ============= Net income (loss) per share (Basic and fully diluted) $ (0.01) $ (0.02) ============== ============= Weighted average number of common shares outstanding 8,625,709 12,288,149 ============== ============= The accompanying notes are an integral part of the financial statements. 4
Imagine Media, LTD. (A Development Stage Company) CONSOLIDATED STATEMENTS OF CASH FLOWS Nine Months Ended Nine Months Ended September 30, 2010 September 30, 2011 (Unaudited) (Unaudited) ------------------ ------------------ Cash Flows From Operating Activities: Net income (loss) $ (402,443) $ (458,692) ----------- ---------- Adjustments to reconcile net loss to net cash provided by (used for) operating activities: Amortization & depreciation 5,534 970 Compensatory equity issuances 53,262 - Asset write offs - - Other assets - - Accrued payables 311,756 48,135 Note payable, benefical conversion expense - (267,276) Original issue discount - interest expense - - ----------- ---------- Net cash provided by (used for)operating activities (31,891) (676,863) ----------- ---------- Cash Flows From Investing Activities: Fixed asset purchases - 4,059 ----------- ---------- Net cash provided by (used for) investing activities $ - $ 4,059 ----------- ---------- (Continued On Following Page) The accompanying notes are an integral part of the financial statements. 5
TransBioTec, Inc. (A Development Stage Company) CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued From Previous Page) Nine Months Ended Nine Months Ended September 30, 2010 September 30, 2011 (Unaudited) (Unaudited) ------------------ ------------------ Cash Flows From Financing Activities: Notes & loans payable - borrowings $ 5,000 $ 16,000 Notes & loans payable - payments (988) (2,500) Repurchase of treasury stock - Equity issuances 27,650 636,718 ----------- ---------- Net cash provided by (used for) financing activities 31,662 650,218 ----------- ---------- Net Increase (Decrease) In Cash (229) (22,586) Cash At The Beginning of the Period 704 30,695 ----------- ---------- Cash At The End of the Period $ 475 $ 8,109 =========== ========== Schedule Of Non-Cash Investing and Financing Activities Compensatory equity issuances $ - $ - Debt converted to capital $ - $1,072,068 Supplemental Disclosure Cash paid for interest $ 122 $ - Cash paid for income taxes $ - $ - The accompanying notes are an integral part of the financial statements. 6
Imagine Media LTD (A Development Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Imagine Media LTD (formerly TransBioTec, Inc.) was incorporated August, 2007 in the State of placeStateDelaware. TransBioTec Inc. was formed in the state of placeStateCalifornia July 4, 2004. Effective September 19, 2011 TransBioTec was acquired by Imagine Media LTD. in a transaction was accounted for similar to a reverse acquisition as the members of TransBioTec retained the majority of the outstanding common stock of Imagine Media LTD after the share exchange. The accounting for the transaction was identical to that resulting from a reverse acquisition, except that no goodwill or other intangibles were recorded. Imagine Media LTD is in the process of changing its name from Imagine Media LTD. TransBioTec, Inc. The financial statements represent the activity of TransBioTec, Inc from July 4 2004 forward, and the consolidated activity of Imagine Media LTD and TransBioTec from September 19, 2011 forward. Imagine Media LTD and TransBioTec 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. Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of operations for a full year. 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. 7
Imagine Media LTD (A Development Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd) 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 December 31, 2009 and 2010, and September 30, 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. 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 in 2009 or 2010, or for the Nine months ended September 30, 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 carryforwards 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. 8
Imagine Media LTD (A Development Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd) 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. 9
Imagine Media LTD (A Development Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd) 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. NOTE 2. RELATED PARTY TRANSACTIONS At year end 2009 and 2010, and September 30, 2011 the Company had payables due to officers for accrued compensation of $361,565, $130,565, and $10,565. In 2009 a related party shareholder converted $52,000 in note principal and interest into 20,800 common shares. In 2010 an officer converted $325,000 in compensation owed him into 130,000 common shares. During the nine months ended September 30, 2011 related party shareholders converted $829,164 in note principal and interest into 552.032 common shares, and $135,000 in compensation to 54,000 shares in TransBioTec. NOTE 3. FIXED ASSETS Fixed asset values recorded at cost are as follows: December 31, (Unaudited) 2009 2010 September 31, 2011 ---- ---- ------------------ Automobile $ 33,383 $ 33,383 $ 33,383 Office and Lab Equipment 31,896 31,896 35,956 Furniture and fixtures 11,596 11,596 11,596 ---------- ---------- ---------- 76,875 76,875 80,935 Less accumulated depreciation (67,453) (74,832) (75,604) ---------- ---------- ---------- Total $ 9,422 $ 2,043 $ 5,331 ========== ========== ========== 10
Imagine Media LTD. (A Development Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 3. FIXED ASSETS (cont'd) Depreciation expense in 2009 and 2010, and for the nine months ended September 30, 2011 was $10,140, $7,379 and $770 respectively. NOTE 4. NOTES PAYABLE December 31, (Unaudited) 2009 2010 September 31, 2011 ---- ---- ------------------ 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 $ 187,256 $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 $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 $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 $151,929 $ - 11
Imagine Media LTD. (A Development Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 4. NOTES PAYABLE (cont'd) December 31, (Unaudited) 2009 2010 September 31, 2011 ---- ---- ------------------ Notes payable to related parties, unsecured, due 01/29/2011, convertible at holder's option at $2.50 per share, interest rate 9% $ - $ 5,000 $ - Notes payable to related parties, unsecured, due 12/31/2012, interest rate 0% $ - $ 15,810 $ 11,810 Note payable to related party, unsecured, due 09/15/2012, convertible at holder's option at $2.50 per TransBioTec share interest rate 10% $ - $ - $ 16,000 Note payable to Ford Motor Credit, secured, payment $584.25 per month $ 4,657 $ - $ - ------- -------- ---------- $735,792 $ 748,845 $ 29,760 Less current portion (581,913) (594,966) (29,760) -------- --------- ---------- Long-term portion $ 153,879 $ 153,879 $ - ========= ========= ========== Required principal payments from December 31, 2010 forward are as follows: 2011 $ - 2012 29,760 ---------- $ 29,760 Interest expense under notes payable in 2009 and 2010, and for the six months ended June 30, 2011 was $206,078, $238,851, and $106,838. 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% Long-term portion $ 30,000 $ 30,000 $ 30,000 12
Imagine Media LTD. (A Development Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 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. At December 31, 2009 and 2010 the Company had net operating loss carryforwards of approximately $604,000 and $1,045,000 respectively, which begin to expire in 2027. The deferred tax asset of at each date of $120,000 and $209,000 created by the net operating losses has been offset by a 100% valuation allowance. The change in the valuation allowance in 2009 and 2010 was approximately $21,000 and $89,000. 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 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 2009 the Company had 60,000 non-employee stock options outstanding, allowing the holder to purchase one share of common stock per option, exercisable at $0.10 per share, with terms expiring from 2011 - 2013. During the year 50,000 options were exercised, and no options expired, leaving a 2009 year end outstanding balance of 10,000 non-employee stock options expiring in December 2011. 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 lives of 2 - 5 years, volatility of 100%. The Company incurred and recorded compensation expense under these stock option grants of $53,262 in 2010. 13
Imagine Media LTD. (A Development Stage Company) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 6. STOCK OPTIONS (cont'd) During the six months ended June 30, 2011 10,000 options were exercised, and no options expired, leaving a June 30, 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. Employee stock options The Company had no outstanding employee stock options in 2009 or 2010, or during the six months ended September 30, 2011. 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. 14
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. On September 19, 2011 the Company acquired approximately 52% of the outstanding shares of TransBiotec, Inc., ("TBT") from TBT's directors, in exchange for 12,416,462 shares of the Company's common stock. TBT is a California Corporation. Prior to the acquisition the Company had 1,500,000 outstanding shares of common stock. The Company is currently acquiring the remaining outstanding shares of TBT from the remaining TBT shareholders in consideration for the issuance of 11,141,348 additional shares of the Company's common stock. 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. TBT as the accounting acquirer in the transaction recorded the acquistion as the issuance of stock for the net monetary assets of the Company accompanied by a recapitalization. This accounting for the transaction was identical to that resulting from a reverse acquisition, except that no goodwill or other intangible assets were recorded. TBT, headquartered in Seal Beach, California, has developed and patented a high technology, state-of-the-art transdermal sensor, 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 TBT system is unobtrusive, accurate, reliable, durable, low cost, easier to use and faster than the current breathalyzer applications. TBT has completed its beta testing of the sensor and is currently developing its manufacturing capability. Initially, TBT intends to offer its sensor only for commercial vehicle applications. Later, TBT plans to market its sensor to the public for use in automobiles, SUV's, RV's, boats and other vehicles. Completion of the Company's acquisition of TBT is subject to the satisfaction of several conditions including without limitation, the execution of a definitive agreement, the satisfactory completion of due diligence by both parties, and the completion of an audit of TBT's financial statements. There can be no assurance that the transaction will be consummated. The following discussion: 2
o summarizes the Company's plan of operation; and o analyzes TBT's financial condition and the results of its operations for the the nine months ended September 30, 2011. This discussion and analysis should be read in conjunction with TBT's financial statements included as an exhibit to this report. 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. January 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. March 2012 $185,000 Improve manufacturing capability to 10,000 units per month October 2012 $370,000 The Company will maintain its research and development efforts with a goal of continuously improving the SOBR. TBT's sources and (uses) of funds for the nine months ended September 30, 2011 and 2010 are shown below: Nine Months ended September 30, ------------------------------- 2010 2011 ---- ---- Net cash provided by (used for) operations $ (31,890) $(676,863) Loans, net of loan repayments $ 4,012 $ 13,500 3
Sale of stock $ 27,650 $ 636,718 Cash on hand at beginning of the period $ 704 $ 30,695 The following table summarizes the Company's and TBT's combined contractual obligations as of September 30, 2011: 2011 2012 2013 Total ---- ---- ---- ----- The notes payable, together $41,500 $62,300 $48,300 $152,100 with accrued interest 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. TBT was formed in July 2004 and has never generated any revenue. Material changes in TBT's Statement of Operations for the nine months September 30, 2011 as compared to the same period in the prior year are discussed below: Increase (I) Item or Decrease (D) Reason ---- --------------- ------ Professional and Sub Contractor Fee (I) Product Development Costs Research and Product Development (I) Purchase of materials Salary and Wage (I) Hiring two sales representatives. Travel (I) Travel required in connection with the acquisition of TransBiotec. Advertising (I) Web Site design 4
On September 15, 2011 TBT entered into an agreement with Ventura LLC ("Ventura"). Pursuant to the agreement, Ventura will receive the following shares of the Company's common stock: o 842,544 shares for assisting with the Company's acquisition of its 52% interest in TBT; o 842,544 shares when $250,000 is raised from the sale of 100,000 shares of the common stock of TBT at $2.50 per share. All shares sold in this offering will be exchanged for shares of the common stock of the Company on the basis of one TBT share for 7.726 shares of the Company's common stock; o 842,544 for shares sold by the Company prior to March 31, 2012 to investors introduced to the Company by Ventura, provided at least $250,000 is raised from such investors prior to March 31, 2012; o 842,544 shares for shares sold by the Company prior to March 31, 2012 to investors introduced to the Company by Ventura, provided an additional $500,000 is raised from such investors prior to March 31, 2012; and o 842,544 shares for shares sold by the Company prior to March 31, 2012 to investors introduced to the Company by Ventura, provided an additional $500,000 is raised from such investors prior to March 31, 2012. If the Company raises at least $1,250,000 from investors introduced to the Company by Ventura, the Company will grant Ventura the exclusive rights to Denver, Douglas and Jefferson counties, Colorado for installations and recalibrations of the SOBR system. As of September 30, 2011 Ventura has raised $240,000 and has been issued 100,000 shares of the TransBioTec, Inc. common stock. 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 September 30, 2011, 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 on that evaluation, the Principal Executive and Financial Officer concluded that the Company's disclosure controls and procedures were effective. 5
(b) Changes in Internal Controls. There were no changes in the Company's internal control over financial reporting during the quarter ended September 30, 2011, 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. 6
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. IMAGINE MEDIA, LTD. November 21, 2011 By: /s/ Charles Bennington ---------------------------------------- Charles Bennington, Principal Executive, Financial and Accounting Officer