SOBR Safe, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

NOTE 4. NOTES PAYABLE

NOTE 4. NOTES PAYABLE

9 Months Ended

Sep. 30, 2013

	December 31, 2011		December 31, 2012		(Unaudited) Sept. 30, 2013
Note payable to related party, unsecured, due 8/3/2012, interest rate 0%	$	1,950	$	1,950	$	1,950

Notes payable to related parties, unsecured, due 12/31/2012, interest rate 0%	$	11,810	$	11,810	$	11,810

Note payable to non-related party, unsecured, due 09/15/2012, convertible at holders option at $2.50 per TBT - CA share.	$	16,000		-		-

Note payable to non-related party, unsecured, due 2/8/12, quarterly interest due, convertible at holders option at $0.3235688 per TBT - DE share, interest rate 30%	$	10,000	$	10,000	$	10,000

Note payable to non-related party, unsecured, due 2/8/12, quarterly interest due, convertible at holders option at $0.3235688 per TBT - DE share, interest rate 30%	$	25,000	$	25,000	$	25,000

Note payable to non-related party, unsecured, due 2/17/12, quarterly interest due, convertible at holders option at $0.3235688 per TBT - DE share, interest rate 30%	$	25,000	$	25,000	$	25,000

Note payable to non-related party, unsecured, due 2/18/12, quarterly interest due, convertible at holders option at $0.3235688 per TBT - DE share, interest rate 30%	$	10,000	$	10,000	$	10,000

Note payable to non-related party, unsecured, due 2/18/13, annual interest due, convertible at holders option at $0.3235688 per TBT-DE share, interest rate 18%

750

Note payable to non-related party, unsecured, due 2/18/13, annual interest due, convertible at holders option at $0.3235688 per TBT-DE share, interest rate 18%

6,875

Note payable to non-related party, unsecured, due 2/15/13, annual interest due, convertible at holders option at $0.3235688 per TBT-DE share, interest rate 12%

2,500

Note payable to non-related party, unsecured, due 2/20/13, annual interest due, convertible at holders option at $0.3235688 per TBT-DE share, interest rate 12%

3,750

Note payable to non-related party, unsecured, due 2/21/13, annual interest due, convertible at holders option at $0.3235688 per TBT-DE share, interest rate 12%

2,625

Note payable to non-related party, unsecured, due 3/20/13, annual interest due, convertible at holders option at $0.3235688 per TBT-DE share, interest rate 12%

5,433

Note payable to non-related party, unsecured, due 3/22/13, annual interest due, convertible at holders option at $0.3235688 per TBT-DE share, interest rate 12%

3,203

Note payable to non-related party, unsecured, due 1/05/13, annual interest due, convertible at holders option at 51% of market as defined, interest rate 8%, conversion limited to total beneficial ownership of 4.99%

10,500

Note payable to non-related party, unsecured, due 2/25/13, annual interest due, convertible at holders option at 51% of market as defined, interest rate 8%, conversion limited to total beneficial ownership of 4.99%

37,500

19,250

Note payable to related party, unsecured, $731,763, 5-years at 0% simple interest, due 7/1/2016, payment amounts vary each month,

various late penalties.

726,763

Note payable to non-related party, unsecured, due 4/19/13, annual interest due, convertible at holders option at 51% of market as defined, interest rate 8%, conversion limited to total beneficial ownership of 4.99%

35,000

52,500

Note payable to non-related party, unsecured, due 08/29/2013, simple interest 8% convertible at holders option at $.249 per TBT-CA share.

15,000

Note payable to non-related party, unsecured, due 03/01/2013, simple interest 9%.

5,000

Note payable to non-related party, unsecured, due 01/31/2013, $12,000 in interest (2 months)

32,000

Note payable to non-related party,unsecured, due 12/13/2013, simple interest 7%.

5,342

Note payable to non-related party,unsecured, due 01/31/2013, simple interest 18%.

3,938

Note payable to non-related party, unsecured, due on demand, simple interest 7%, convertible at anytimeinto common stock at 65% of market closing price on previous day

55,000

Note payable to non-related party, unsecured, due 01/07/2014, simpleinterest 7%, default interest 10%, stock option

15,000

Note payable to non-related party, unsecured, due 01/15/2014, simpleinterest 7%, default interest 10%, stock option

5,000


Note payable to non-related party, unsecured, due 01/20/2014, simple interest 7%, default interest 10%, stock option			-				-			$	65,272

Note payable to non-related party, unsecured, due 03/28/2013, $13,000in interest (1 month)

45,000

Note payable to non-related party, unsecured, due 01/23/2014, simple interest 9%,

50,000

Note payable to non-related party, unsecured, due 05/05/2014, simple interest 7%, default interest 10%, stock option

50,060

Note payable to non-related party,unsecured, due 10/25/2013, simple interest 18%,

2,000

Note payable to non-related party, unsecured, due 07/29/2014, simple interest 7%, default interest 10%, stock option

1,900

Note payable to non-related party, unsecured, due 09/19/2014, simple interest 7%, default interest 10%, stock option

10,000

Note payable to non-related party, unsecured, due 09/19/2014, simple interest 7%, default interest 10%, stock option

65,000

Note payable to non-related party, unsecured, due 09/29/2014, simple interest 7%, default interest 10%, stock option

20,000

Note payable to non-related party, unsecured, due 12/27/2013, simple interest 9%,

15,000

Note payable to non-related party, unsecured, due 07/02/2014, simple interest 9%,

15,000

826,523

979,939

1,350,921

Less Note Discounts		-			-			-

Less current portion		(277,260	)		(616,051	)		(1,183,914	)

Long-term portion	$	549,263		$	363,888		$	167,007

Required principal payments from December 31, 2013 forward are as follows:


2013	$	689,801
2014	$	494,113
2015	$	123,709
2016	$	43,298
2017	$	-

	$	1,350,921

Interest expense under notes payable for the nine months ended September 30, 2013 and September 30, 2012 was $86,214 and $56,938, respectively.

During the nine months ended September 30, 2013 and September 30, 2012 the Company recognized a beneficial conversion feature expense on borrowing from convertible notes of $152,993 and $102,388, respectively.

At September 30, 2013 the unamortized note discount from the beneficial conversion feature was $29,164.

In 2012 the Company borrowed $110,000 under convertible notes with a variable conversion price based on a percentage of market price. $27,000 of the notes were converted in 2012. The Company determined that these notes have an embedded derivative and are therefore accounted for at fair value. The Company recorded an expense of $448,137 in 2012 for fair value adjustments based on the Black-Scholes method using the following assumptions: risk free interest rate of 0.08%, dividend yield of 0%, expected life of 2-4 months, volatility of 172% - 197%. During the six months ended June 30, 2013 the Company borrowed $75,000 under a convertible note with a variable conversion price based on a percentage of market price. The note was not converted as of June 30, 2013. The Company determined that this note has an embedded derivative and are therefore accounted for at fair value. The Company recorded an expense of $389,297 during the six months ended June 30, 2013 for fair value adjustments based on the Black-Scholes method using the following assumptions: risk free interest rate of 0.08%, dividend yield of 0%, expected life of 2 4 months, volatility of 172% - 197%. The fair equity obligation liability under the notes at June 30, 2013 was $832,565.

	December 31,				Unaudited
	2011		2012		Sept. 30, 2013
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	$	-	$	-

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References + Details