Effective September 19, 2011 TransBiotec - DE entered into a share exchange agreement (the “Agreement) with TransBiotec - CA and certain shareholders of TransBiotec - CA, acquiring 51.44% of the outstanding common stock of TransBiotec - CA through the issuance of 12,416,462 shares of its common stock with no readily available market price. The transaction was accounted for as a reverse acquisition as the shareholders of TransBiotec - CA retained the majority of the outstanding common stock of TransBiotec - DE after the share exchange. Effective with the Agreement, the Company’s stockholders’ equity was retroactively recapitalized as that of TransBiotec - CA, while the net deficit of TransBiotec - DE valued at ($191,081), consisting of cash $6, accounts payable $96,952, related party payables $54,835, notes payable $30,000, and interest payable $9,300, was recorded as being acquired in the reverse acquisition for its 1,410,650 outstanding common shares on the acquisition date. Subsequent to the September 19, 2011 recapitalization, TransBiotec - DE and TransBiotec - CA remain separate legal entities (with TransBiotec - DE as parent of TransBiotec - CA). The accompanying consolidated financial statements exclude the financial position, results of operations and cash flows of TransBiotec - DE prior to the September 19, 2011 acquisition. In December 2011 TransBiotec - DE acquired a further 46.1% interest in TransBiotec - CA through an exchange of 11,128,205 TransBiotec - DE common shares for 1,440,300 TransBiotec - CA common shares. In 2012 TransBiotec - DE acquired an additional 1.08% interest in TransBiotec - CA through an exchange of 251,105 TransBiotec - DE common shares for 32,500 TransBiotec - CA common shares. At December 31, 2011 and 2012 TransBiotec - DE owned 97.54% and 98.62% of TransBiotec – CA.

If TransBiotec - DE’s operating activity for the year ended December 31, 2011 is combined with TransBiotec - CA’s activity for the same period, the pro forma results are as follows: