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

3 Months Ended

Mar. 31, 2013

	December 31, 2011		December 31, 2012		(Unaudited) March 31, 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, unsecured, due 2/18/13, annually Interest due, convertible at holder's option at $0.3235688 per IMLE share, interest rate 18%	$	-	$	750	$	750

Note payable, unsecured, due 2/18/13, annually Interest due, convertible at holder's option at $0.3235688 per IMLE share, interest rate 18%	$	-	$	6,875	$	6,875

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	$	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	$	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	$	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	$	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	$	3,203

Note payable, unsecured, due 1/05/13, annually Interest due, convertible at holder's option at 51% of market as defined, interest rate 8% Conversion limited to total beneficial ownership of 4.99%	$	-	$	10,500	$	-

Note payable, unsecured, due 2/25/13, annually Interest due, convertible at holder's option at 51% of market as defined, interest rate 8% Conversion limited to total beneficial ownership of 4.99%	$	-	$	37,500	$	37,500

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	$	726,763

Note payable to related party, lien against company assets, unsecured, due 4/19/2013, 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	$	35,000

Note payable to non-related party, unsecured, due 8/29/2013, simple interest 8% convertible at holders' option at $.249 per TransBiotec share	$	-	$	15,000	$	15,000

Note payable to non-related party, unsecured, due 03/01/2013, simple interest 9%	$	-	$	5,000	$	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, interest rate 7%	$	-	$	5,342	$	5,342

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

Note payable to non-related party, unsecured, interest rate 7%, due on demand, convertible at anytime into common stock at 65% of market closing price on previous day	$	-	$	-	$	75,000

Note payable to non-related party, unsecured, due 01/07/2014, interest rate 7%, default interest 10%, stock option	$	-		$	-		$	15,000

Note payable to non-related party, unsecured, due 01/15/2014, interest rate 7%, default interest 10%, stock option	$	-		$	-		$	5,000

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

Note payable to non-related party, unsecured, due 03/28/2013, $13,000 in interest (1 month)	$	-		$	-		$	45,000

Note payable to non-related party, unsecured, due 01/23/2014, interest rate 9%,	$	-		$	-		$	50,000
	$	826,523		$	979,939		$	1,192,711
Less current portion		(277,260	)		(616,051	)		(1,025,704	)

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

Required principal payments from December 31, 2012 forward are as follows:

2013	$	828,823
2014	$	196,881
2015	$	123,709
2016	$	43,298
2017	$	-

	$	1,192,711

Interest expense under notes payable for the three months ended March 31, 2013 and March 31, 2012 was $38,095 and $23,960, respectively.

During the three months ended March 31, 2013 and March 31, 2012 the Company recognized a beneficial conversion feature expense on borrowing from convertible notes of $77,103 and $20,136, respectively. At March 31, 2013 the unamortized note discount from the beneficial conversion feature was $51,804.

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 three months ended March 31, 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 March 31, 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 $95,613 during the three months ended March 31, 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 March 31, 2013 was $555,796.

	December 31,				(Unaudited)
	2011		2012		March 31, 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.

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