x ~~QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

¨ ~~TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

~~TRANSBIOTEC, INC.~~SOBR Safe, Inc.

~~(Exact~~(Exact name of registrant as specified in its charter)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 ¨☒ No x☐

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 (§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, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨☐	Accelerated filer	¨☐
Non-accelerated filer	¨☒	Smaller reporting company	x☒
~~(Do not check if a smaller reporting company)~~		Emerging growth company	¨☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨☐ No x☒ .

Applicable only to issuers involved in bankruptcy proceedings during the preceding five years:

Indicate by check mark whether the registrant filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ¨☐ No ¨☐

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of ~~January 30,~~August 18, 2020, there were ~~238,825,917~~20,046,847 shares of common stock, $0.00001 par value, issued and outstanding.

This Quarterly Report includes forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements are based on management’s beliefs and assumptions, and on information currently available to management. Forward-looking statements include the information concerning our possible or assumed future results of operations set forth under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Forward-looking statements also include statements in which words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “consider,” or similar expressions are used.

Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties, and assumptions. Our future results and shareholder values may differ materially from those expressed in these forward-looking statements. Readers are cautioned not to put undue reliance on any forward-looking statements.

At the open of market on June 8, 2020, our 1-for-33.26 reverse split of our common stock went effective with OTC Markets. As a result, all common stock share amounts, as well as share amounts and exercise and conversion prices in derivative security instruments have been adjusted to reflect the reverse stock split.

The balance sheets as of June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, the statements of operations for the three ~~months~~ and six months ended June 30, ~~2019~~2020 and ~~2018,~~2019, the statements of changes in stockholders’ ~~deficit~~equity for the three and ~~the~~ six months ended June 30, ~~2019~~2020 and ~~2018,~~2019, and the statements of cash flows for the six months ended June 30, ~~2019~~2020 and ~~2018,~~2019, follow. The unaudited condensed consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. All such adjustments are of a normal and recurring nature.

	June 30, 2019			December 31, 2018			June 30, 2020			December 31, 2019
	(Unaudited)			(Audited)			(Unaudited)			(Audited)

ASSETS

Current assets
Cash	$	4,931		$	89		$	727,633		$	681,759
Related party receivables								6,446			-
Prepaid expenses		10,966			12,991			9,488			9,054
Total current assets		15,897			13,080			743,567			690,813

Property and equipment, net of accumulated depreciation $44,788 and $43,683 at June 30, 2020 and December 31, 2019, respectively								46,620			-

SOBR Safe Intellectual Technology, net of accumulated amortization of $32,122 at June 30, 2020								3,822,553			-

Other assets								8,680			-
Total Assets	$	15,897		$	13,080		$	4,621,420		$	690,813


LIABILITIES & STOCKHOLDERS’ DEFICIT
LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)

Current liabilities
Accounts payable	$	163,097		$	191,714		$	78,202		$	213,880
Accrued expenses		419,572			421,000			393,882			419,836
Accrued interest payable		615,885			537,118			126,417			674,041
Related party payables		1,454,375			1,423,984			31,590			905,443
Derivative liabilities		52,900			-			-			60,650
Stock subscriptions payable		2,058			1,271
Common stock subscriptions payable								100,126			79,624
Preferred stock subscriptions payable								1,770,000			1,000,000
Notes payable - current - related parties		752,583	*		697,770			1,496,999	*		760,886	*
* Includes unamortized debt discount related to detached warrants of $28,011 and $8,074 at June 30, 2019 and December 31, 2018, respectively
* Includes unamortized debt discount related to detached warrants of none and $8,656 at June 30, 2020 and December 31, 2019, respectively
Notes payable - current - non-related parties		185,317	*		163,654			145,848			169,574
* Includes unamortized discount related to convertible notes of $44,257 and $5,920 at June 30,2019 and December 31, 2018, respectively
Total current liabilities		3,645,787			3,436,511			4,143,064			4,283,934


Total Liabilities		3,645,787			3,436,511			4,143,064			4,283,934
Stockholders’ Deficit
Preferred stock, $0.00001 par value; 22,000,000 shares authorized, No shares issued or outstanding as of June 30, 2019 and December 31, 2018		-			-
Series A Convertible Preferred stock, $0.00001 par value; 3,000,000 shares authorized, 1,388,575 shares issued and outstanding as of June 30, 2019 and December 31, 2018		14			14
Common stock, $0.00001 par value; 800,000,000 shares authorized; 152,205,625 and 109,409,930 shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively		1,522			1,172
Stockholders' Equity (Deficit)
Series A-1 Convertible Preferred stock, $0.00001 par value; 2,000,000 shares authorized, no shares issued and outstanding as of June 30, 2020 and December 31, 2019								-			-
Common stock, $0.00001 par value; 100,000,000 shares authorized; 20,046,424 and 6,452,993 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively, after 1-for-33.26 reverse stock split								201			65
Additional paid-in capital		14,977,006			14,887,804			48,203,770			15,971,392
Accumulated deficit		(18,556,562	)		(18,262,136	)		(47,672,155	)		(19,511,168	)
Total Transbiotec, Inc. stockholders’ deficit		(3,578,020	)		(3,373,146	)
Total SOBR Safe, Inc. stockholders' equity (deficit)								531,816			(3,539,711	)
Noncontrolling interest		(51,870	)		(50,285	)		(53,460	)		(53,410	)

Total Stockholders’ Deficit		(3,629,890	)		(3,423,431	)
Total Stockholders' Equity (Deficit)								478,356			(3,593,121	)

Total Liabilities and Stockholders’ Deficit	$	15,897		$	13,080
Total Liabilities and Stockholders' Equity (Deficit)							$	4,621,420		$	690,813

The accompanying notes are an integral part of the condensed consolidated financial statements.

~~TransBiotec, Inc.~~

~~CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS~~

~~(UNAUDITED)~~

													For The Three Months Ended						For The Six Months Ended
	For The Three Months Ended						For The Six Months Ended						June 30,			June 30,			June 30,			June 30,
	June 30, 2019			June 30, 2018			June 30, 2019			June 30, 2018			2020			2019			2020			2019
													(Unaudited)						(Unaudited)
Revenues	$	-		$	-		$	-		$	-		$	-		$	-		$	-		$	-

Operating expenses:
General and administrative		81,483			82,925			150,497			162,768			177,915			81,483			276,107			150,497
Stock-based compensation expense														-			-			41,302			-
Management salaries and consulting fees														461,864			-			683,993			-
Research and development														89,570			-			157,280			-
Total operating expenses		81,483			82,925			150,497			162,768			729,349			81,483			1,158,682			150,497

Loss from operations		(81,483	)		(82,925	)		(150,497	)		(162,768	)		(729,349	)		(81,483	)		(1,158,682	)		(150,497	)

Other income (expense):
Loss on extinguishment of debt, net														(297,711	)		-			(269,144	)		-
Gain on fair value adjustment - derivatives		4,000			-			3,200			-			61,350			4,000			60,650			3,200
Interest expense		(67,065	)		(68,189	)		(130,951	)		(132,216	)		(17,397	)		(67,065	)		(65,631	)		(130,951	)
Amortization - debt discount		(12,407	)		(500	)		(17,763	)		(500	)
Amortization of interest - beneficial conversion feature														(1,407,501	)		(12,407	)		(1,407,675	)		(17,763	)
Asset impairment adjustment														(25,320,555	)		-			(25,320,555	)		-
Total other income (expense)		(75,472	)		(68,689	)		(145,514	)		(132,716	)		(26,981,814	)		(75,472	)		(27,002,355	)		(145,514	)

Loss before provision for income taxes		(156,955	)		(151,614	)		(296,011	)		(295,484	)		(27,711,163	)		(156,955	)		(28,161,037	)		(296,011	)

Provision for income tax		-			-			-			-
Provision for income taxes														-			-			-			-

Net loss		(156,955	)		(151,614	)		(296,011	)		(295,484	)		(27,711,163	)		(156,955	)		(28,161,037	)		(296,011	)

Net loss attributable to noncontrolling interest		818			804			1,585			1,625			199			818			50			1,585
Net loss attributable to TranBiotec, Inc.	$	(156,137	)	$	(150,810	)	$	(294,426	)	$	(293,859	)

Net loss attributable to SOBR Safe, Inc.													$	(27,710,964	)	$	(156,137	)	$	(28,160,987	)	$	(294,426	)

Net loss per share
(Basic and fully diluted)	$	(0.001	)	$	(0.001	)	$	(0.002	)	$	(0.003	)	$	(2.45	)	$	(0.034	)	$	(2.97	)	$	(0.069	)

Weighted average number of common shares outstanding		152,205,625			115,152,177			141,236,262			112,296,916			11,330,815			4,576,236			9,484,508			4,246,430

The accompanying notes are an integral part of the ~~unaudited~~ condensed consolidated financial statements.

~~TransBiotec,~~SOBR Safe, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' ~~DEFICIT~~EQUITY

(UNAUDITED)

	Common Stock				Preferred Stock									Stockholders'									Common Stock				Preferred Stock									Stockholders' Equity						Total
			Amount				Amount		Additional					Deficit -						Total					Amount				Amount		Additional					(Deficit)						Stockholders'
	Shares		($0.00001 Par)		Shares		($0.00001 Par)		Paid-in Capital		Accumulated Deficit			TransBiotec Inc.			Noncontrolling Interest			Stockholders' Deficit			Shares		($0.00001 Par)		Shares		($0.00001 Par)		Paid-in Capital		Accumulated Deficit			SOBR Safe, Inc.			Noncontrolling Interest			Equity (Deficit)

Balances at January 1, 2018		109,409,930	$	1,096		1,388,575	$	14	$	14,785,051	$	(17,703,171	)	$	(2,917,010	)	$	(47,127	)	$	(2,964,137	)
Common stock issued to settle accounts payable		91,148		1		-		-		427		-			428			-			428
Paid-in capital - relative fair value of stock warrants granted		-		-		-		-		10,958		-			10,958			-			10,958
Paid-in capital - gain on related party debt conversion		-		-		-		-		7,776		-			7,776			-			7,776
Net loss for the period		-		-		-		-		-		(143,049	)		(143,049	)		(821	)		(143,870	)
Balances at March 31, 2018		109,501,078	$	1,097		1,388,575	$	14	$	14,804,212	$	(17,846,220	)	$	(3,040,897	)	$	(47,948	)	$	(3,088,845	)
Common stock issued for services		6,000,000		61		-		-		25,739		-			25,800			-			25,800
Common stock issued for compensation		800,000		9		-		-		7,991		-			8,000			-			8,000
Common stock issued due to options exercise		450,000		5		-		-		4,495		-			4,500			-			4,500
Paid-in capital - relative fair value of stock warrants granted		-		-		-		-		18,743		-			18,743			-			18,743
Paid-in capital - gain on related party debt conversion		-		-		-		-		7,367		-			7,367			-			7,367
Paid-in capital - beneficial conversion feature		-		-		-		-		6,000		-			6,000			-			6,000
Net loss for the period		-		-		-		-		-		(150,810	)		(150,810	)		(804	)		(151,614	)
Balances at June 30, 2018		116,751,078	$	1,172		1,388,575	$	14	$	14,874,547	$	(17,997,030	)	$	(3,121,297	)	$	(48,752	)	$	(3,170,049	)

Balances at January 1, 2019		116,751,078	$	1,172		1,388,575	$	14	$	14,887,804	$	(18,262,136	)	$	(3,373,146	)	$	(50,285	)	$	(3,423,431	)		3,510,255	$	35		1,388,575	$	14	$	14,888,941	$	(18,262,136	)	$	(3,373,146	)	$	(50,285	)	$	(3,423,431	)
Common stock issued for cash		35,454,547		350		-		-		38,650		-			39,000			-			39,000			1,065,982		11		-		-		38,989		-			39,000			-			39,000
Paid-in capital - relative fair value of stock warrants granted		-		-		-		-		22,665		-			22,665			-			22,665
Paid-in capital - fair value of stock warrants granted																								-		-		-		-		22,665		-			22,665			-			22,665
Paid-in capital - gain on related party debt conversion		-		-		-		-		8,113		-			8,113			-			8,113			-		-		-		-		8,113		-			8,113			-			8,113
Net loss for the period		-		-		-		-		-		(138,289	)		(138,289	)		(767	)		(139,056	)		-		-		-		-		-		(138,289	)		(138,289	)		(767	)		(139,056	)
Balances at March 31, 2019		152,205,625	$	1,522		1,388,575	$	14	$	14,957,232	$	(18,400,425	)	$	(3,441,657	)	$	(51,052	)	$	(3,492,709	)		4,576,236	$	46		1,388,575	$	14	$	14,958,708	$	(18,400,425	)	$	(3,441,657	)	$	(51,052	)	$	(3,492,709	)
Paid-in capital - relative fair value of stock warrants granted		-		-		-		-		12,365		-			12,365			-			12,365
Paid-in capital - gain on related party debt conversion		-		-		-		-		7,409		-			7,409			-			7,409

Paid-in capital-relative fair value of stock warrants granted																								-		-		-		-		12,365		-			12,365			-			12,365
Paid-in capital-gain on related party debt conversion																								-		-		-		-		7,409		-			7,409			-			7,409
Net loss for the period		-		-		-		-		-		(156,137	)		(156,137	)		(818	)		(156,955	)		-		-		-		-		-		(156,137	)		(156,137	)		(818	)		(156,955	)
Balances at June 30, 2019		152,205,625	$	1,522		1,388,575	$	14	$	14,977,006	$	(18,556,562	)	$	(3,578,020	)	$	(51,870	)	$	(3,629,890	)		4,576,236	$	46		1,388,575	$	14	$	14,978,482	$	(18,556,562	)	$	(3,578,020	)	$	(51,870	)	$	(3,629,890	)

Balances at January 1, 2020																								6,452,993	$	65		-	$	-	$	15,971,392	$	(19,511,168	)	$	(3,539,711	)	$	(53,410	)	$	(3,593,121	)
Common stock issued for compensation																								601		-		-		-		20,800		-			20,800			-			20,800
Common stock issued due to stock warrants exercise																								454,097		4		-		-		65,724		-			65,728			-			65,728
Common stock issued to settle related party payables																								214,883		2		-		-		493,072		-			493,074			-			493,074
Common stock issued to settle accounts payable and accrued expenses																								38,323		-		-		-		92,385		-			92,385			-			92,385
Common stock issued to settle related party debt																								648,739		6		-		-		826,958		-			826,964			-			826,964
Common stock issued to settle non-related party debt																								70,448		1		-		-		166,525		-			166,526			-			166,526
Paid-in capital - fair value of stock options vested																								-		-		-		-		39,450		-			39,450			-			39,450
Paid-in capital - gain on related party debt conversion																								-		-		-		-		124,291		-			124,291			-			124,291
Paid-in capital - gain on related party payables conversion																								-		-		-		-		221,557		-			221,557			-			221,557
Paid-in capital - loss on related party debt extinguishment																								-		-		-		-		116,893		-			116,893			-			116,893
Paid-in capital - beneficial conversion feature																								-		-		-		-		174		-			174			-			174
Net loss for the period																								-		-		-		-		-		(450,023	)		(450,023	)		149			(449,874	)
Balances at March 31, 2020																								7,880,084	$	78		-	$	-	$	18,139,221	$	(19,961,191	)	$	(1,821,892	)	$	(53,261	)	$	(1,875,153	)

Common stock issued to settle accounts payable and accrued expenses																								121,072		2		-		-		173,290		-			173,292			-			173,292
Common stock issued to settle related party payables																								45,268		1		-		-		86,739		-			86,740			-			86,740
Common stock issued for asset purchase																								12,000,000		120		-		-		27,119,880		-			27,120,000			-			27,120,000
Paid-in capital - beneficial conversion feature																								-		-		-		-		1,407,501		-			1,407,501			-			1,407,501
Paid-in capital - fair value of stock warrants granted																								-		-		-		-		695,454		-			695,454			-			695,454
Paid-in capital - gain on related party payables conversion																								-		-		-		-		50,741		-			50,741			-			50,741
Paid-in capital - loss on extinguishment of convertible notes																								-		-		-		-		273,462		-			273,462			-			273,462
Paid-in capital - fair value of stock options vested																								-		-		-		-		257,482		-			257,482			-			257,482
Net loss for the period																								-		-		-		-		-		(27,710,964	)		(27,710,964	)		(199	)		(27,711,163	)
Balances at June 30, 2020																								20,046,424	$	201		-	$	-	$	48,203,770	$	(47,672,155	)	$	531,816		$	(53,460	)	$	478,356

The accompanying notes are an integral part of the ~~unaudited~~ condensed consolidated financial statements.

~~TransBiotec, Inc.~~
~~CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS~~
~~(UNAUDITED)~~

SOBR Safe, Inc.

For The Six Months Ended

June 30,

2019

2018

Operating Activities:

Net loss

$ (296,011 )

$ (293,859 )

Adjustments to reconcile net loss to net cash used in

operating activities:

Change in fair value of derivative liability

(3,200 )

-

Amortization - debt discount

17,763

500

Stock warrants expense

15,093

22,517

Stock options expense

-

4,500

Stock-based compensation expense

-

7,999

Changes in assets and liabilities:

Prepaid expenses

2,025

5,483

Accounts payable

(28,617 )

(116,142 )
Accrued expenses

(1,428 )

20,925

Accrued interest payable

78,767

81,401

Related party payables

45,913

208,555

Stock subscriptions payable

787

557

Net cash used in operating activities

(168,908 )

(57,564 )

Financing Activities:

Proceeds from notes payable - related parties

74,750

55,300

Proceeds from notes payable - non-related parties

60,000

6,000

Proceeds from issuances of common stock - non-related parties

39,000

-

Net cash provided by financing activities

173,750

61,300

Net Change In Cash

4,842

3,736

Cash At The Beginning Of The Period

89

142

Cash At The End Of The Period

$ 4,931

$ 3,878

Schedule Of Non-Cash Investing And Financing Activities:

Gain on related party payables converted to capital

$ 15,522

$ 15,571

Relative fair value of stock warrants granted

$ 35,030

$ 29,701

Fair value of embedded conversion feature

$ 56,100

$ -

Intrinsic value - beneficial conversion feature

$ -

$ 6,000

Research and development prepaid expenses with commons shares

$ -

$ 25,800

Supplemental Disclosure:

Cash paid for interest

$ 3,750

$ -

Cash paid for income taxes

$ -

$ -

(UNAUDITED)

The accompanying notes are an integral part of the ~~unaudited~~ condensed consolidated financial statements.

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

TransBiotec, Inc. (“TransBiotec – DE”), formerly Imagine Media LTD., was incorporated August, 2007 in the State of Delaware. A corporation also named TransBiotec, Inc. (“TransBiotec – CA”) was formed in the state of California July 4, 2004. Effective September 19, 2011 TransBiotec - DE was acquired by TransBiotec - CA in a transaction classified 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. The financial statements represent the activity of TransBiotec - CA from July 4, 2004 forward, and the consolidated activity of TransBiotec - DE and TransBiotec - CA from September 19, 2011 forward. TransBiotec - DE and TransBiotec - CA are hereinafter referred to collectively as the ~~"Company"~~“Company” or “We”. The Company has developed and plans to market and sell a non-invasive alcohol sensing system which includes an ignition interlock. The Company has not generated any revenues from its operations.

On March 23, 2020, the Company filed a Definitive 14C providing notice that the Board of Directors has recommended, and that holders of a majority of the voting power of the Company’s outstanding stock voted, to approve the following.

The above actions taken by the Company’s stockholders became effective on or about May 21, 2020. The effective dates of the above actions were June 5, 2020 and April 20, 2020, respectively, and the actual reverse stock split ratio was 1-for-33.26. All share and per amounts have been adjusted in the financial statements to reflect the effect of the reverse stock split.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United States of America and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes for the year ended December 31, ~~2018,~~2019, included in the Company’s Annual Report on Form 10-K filed with the SEC on ~~August 8, 2019.~~April 17, 2020.

In management’s opinion, the unaudited condensed consolidated financial statements reflect all adjustments (including reclassifications and normal recurring adjustments) necessary to present fairly the financial position as of June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, and results of operations ~~and cash flows~~ for the three month and six month ~~period~~periods ended June 30, ~~2019~~2020 and ~~for the year ended December 31, 2018.~~2019.

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its majority owned subsidiary, TransBiotec-CA. We have eliminated all intercompany transactions and balances between entities consolidated in these unaudited condensed financial statements.

The preparation of unaudited condensed consolidated 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. Specifically, such estimates were made by the Company for the valuation of the derivative ~~liability and~~liabilities, beneficial conversion feature ~~expenses.~~expenses and intellectual technology. Actual results could differ from those estimates.

The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents. The Company does not have any cash equivalents as of June 30, ~~2019~~2020 and December 31, ~~2018.~~2019.

~~The Company accounts for income taxes pursuant~~Pursuant to Accounting Standards Codification (“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. The Company has not recorded any deferred tax assets or liabilities at June 30, 2019 and December 31, 2018, respectively.

~~The basic and fully diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding.~~

~~Pursuant to ASC~~ Topic 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 and 825 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 and 825 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets: quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments consist primarily of cash, accounts payable, accrued expenses, accrued interest payable, notes payable, related party payables, convertible debentures, and other payables. Pursuant to ASC 820 and 825, the fair value of our derivative liabilities is determined based on “Level 3” inputs. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.

The following table presents assets and liabilities that are measured and recognized at fair value as of June 30, ~~2019~~2020 and December 31, ~~2018:~~2019:

June 30, 2019
June 30, 2020

	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Derivative liabilities	$	-	$	-	$	52,900	$	-	$	-	$	-
	$	-	$	-	$	52,900	$	-	$	-	$	-
December 31, 2018
December 31, 2019

	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Derivative liabilities	$	-	$	-	$	-	$	-	$	-	$	60,650
	$	-	$	-	$	-	$	-	$	-	$	60,650

From time to time, the Company may issue convertible notes that may contain ~~an embedded~~a beneficial conversion feature. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of the warrants, if related warrants have been granted. The intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid-in capital. The debt discount is amortized to interest expense over the life of the note using the effective interest method.

The fair value of derivative instruments is recorded and shown separately under current liabilities. Changes in fair value are recorded in the consolidated statement of operations under other income (expense).

The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instruments are initially recorded at their fair values and are then re-valued at each reporting date, with changes in the fair value reported in the unaudited condensed consolidated statements of operations under other income (expense). The accounting treatment of derivative financial instruments requires that the Company record the embedded conversion option at its fair value as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. As a result of entering into warrant agreements, for which such instruments contained a variable conversion feature with no floor, the Company has adopted a sequencing policy in accordance with ASC 815-40-35-12 whereby all future instruments may be classified as a derivative liability with the exception of instruments related to share-based compensation issued to employees or directors. For stock-based derivative financial instruments, the Company uses a Monte Carlo Simulation model to value the derivative instruments at inception and on subsequent valuation dates.

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date.

We apply the guidance enumerated in ASC 480 “Distinguishing Liabilities from Equity” when determining the classification and measurement of ~~its financial~~preferred stock. Preferred shares subject to mandatory redemption (if any) are classified as liability instruments ~~to determine if such instruments~~and are ~~derivatives or contain features~~measured at fair value. We classify conditionally redeemable preferred shares (if any), which includes preferred shares that ~~qualify as embedded derivatives. For derivative financial instruments~~feature redemption rights that are ~~accounted for as liabilities,~~either within the ~~derivative instruments are initially recorded at their fair values and are then re-valued at each reporting date, with changes in the fair value reported in the consolidated statements of operations.~~

~~Stock-based compensation cost to employees and non-employees is measured by the Company at the grant date based on the fair value~~control of the ~~award and over~~holder or subject to redemption upon the ~~requisite service period under ASC 718. For options issued to employees and non-employees, the Company recognizes stock compensation costs utilizing the fair value methodology over the related period~~occurrence of ~~benefit.~~uncertain events not solely within our control, as temporary equity. At all other times, we classified our preferred shares in stockholders’ equity.

A subsidiary of the Company has minority members representing ownership interests of 1.38% at June 30, ~~2019~~2020 and December 31, ~~2018.~~2019. The Company accounts for these minority, or noncontrolling interests, pursuant to ASC 810-10-65 whereby gains and 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.

The Company follows the guidance of the accounting provisions of ASC 718 Share-based Compensation, which requires the use of the fair-value based method to determine compensation for all arrangements under which employees and others receive shares of stock or equity instruments (warrants and options). The fair value of each option award is estimated on the date of grant using the Black-Scholes options-pricing model that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. The Company has not paid dividends historically and does not expect to pay them in the future. Expected volatilities are based on weighted averages of the historical volatility of the Company’s common stock estimated over the expected term of the options. The expected term of options granted is derived using the “simplified method” which computes expected term as the average of the sum of the vesting term plus the contract term as historically the Company had limited activity surrounding its options. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the period of the expected term.

In applying the Black-Scholes options-pricing model, assumptions used were as follows:

The Company accounts for its research and development costs pursuant to ASC 730, whereby it requires the Company to disclose the amounts of costs for company and customer-sponsored research and development activities, if material. Research and development costs are expensed as incurred. The Company incurred research and development costs as it acquired new knowledge to bring about significant improvements in the functionality and design of its SOBR product. Research and development costs were $157,280 and none during the six month ~~period~~periods ended June 30, ~~2019~~2020 and ~~$1,347 during the six month period ended~~ June 30, ~~2018.~~2019, respectively.

The Company accounts for income taxes pursuant to Accounting Standards Codification 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. The Company has not recorded any deferred tax assets or liabilities at June 30, 2020 and December 31, 2019, respectively.

The basic and fully diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding.

Related parties are any entities or individuals that, through employment, ownership or other means, possess the ability to direct or cause the direction of the management and policies of the Company.

In February 2016, the ~~FASB~~Financial Accounting Standards Board (“FASB”) issued ~~ASU~~Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842), which requires a lessee to recognize most leases on its balance sheet. For leases with terms of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. This lease standard was effective for public business entities for periods beginning after December 15, 2018. The standard’s modified retrospective transition approach will require entities to reflect the effect to reflect the effect in the earliest year presented in the financial statements. ~~The Company has adopted this standard; however, during the six month period ended June 30,~~In March 2019, ~~the Company had one lease identified as an operating lease with a term of less than 12 months, and therefore elected not to recognize the lease on its balance sheet.~~

~~In May 2017, the~~ FASB issued ASU ~~2017-09,~~ ~~Scope of Modification Accounting, clarifies Topic 718, Compensation – Stock Compensation~~~~, which requires a company~~No. 2019-01, Codification Improvements to apply modification accounting to changes in the terms or conditions of a share-based payment award unless all of the following criteria are met: (1) the fair value of the modified award is the same as the fair value of the original award immediately before the modification. The ASU indicates that if the modification does not affect any of the inputsLeases (Topic 842): Amendments to the ~~valuation technique used to value the award, the entity is not required to estimate the value immediately before~~FASB Accounting Standards Codification. The amendments in this ASU contain improvements and ~~after the modification; (2) the vesting conditions~~clarifications of ~~the modified award~~certain guidance in Topic 842. The new amendments are the same as the vesting conditions of the original award immediately before the modification; and (3) the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the modification. The ASU is effective ~~for all entities~~ for fiscal years beginning after December 15, ~~2017, including interim periods within those years. Early adoption is permitted, including adoption~~2019 (i.e. a January 1, 2020 effective date). Management adopted the provisions of this statement and took them into account in ~~an interim period.~~the preparation of the financial statements for the year ended December 31, 2019. The Company has ~~decided~~only short-term leases and has elected to ~~adopt this standard; however, during~~utilize the ~~six month period ended June 30, 2019 the Company currently does~~practical expedient and as a result, has not ~~have any modifications to existing stock compensation agreements but will be able to calculate the impact~~recognized a right of ~~the ASU, if and when modifications arise.~~use asset or related liability on its balance sheet.

In July 2017, the FASB issued ASU-2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Noncontrolling Interests of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The first part of this update addresses the complexity of accounting for certain financial instruments with down round features and the second part addresses the complexity of distinguishing equity from liabilities. ASU 2017-11 eliminates the requirement that a down round feature precludes equity classification when assessing whether an instrument is indexed to an entity’s own stock. A freestanding equity-linked financial instrument no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. A company will recognize the value of a down round feature only when it is triggered, and the strike price has been adjusted downward. For equity-classified freestanding financial instruments, an entity will treat the value of the effect of the down round as a dividend and a reduction of income available to common stockholders in computing basic earnings per share. For convertible instruments with embedded conversion features containing down round provisions, entities will recognize the value of the down round as a beneficial conversion discount to be amortized to earnings. Under current GAAP, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in Topic 480 is evaluated under the guidance in Topic 815, Derivatives and Hedging, to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting. Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date. The amendments in this Update revise the guidance for instruments with down round features in Subtopic 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity, which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in Subtopic 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated. The effective date for ASU 2017-11 is for annual or any interim periods beginning after December 15, 2018. The guidance is applicable to public business entities for fiscal years beginning after December 15, 2018 and interim periods within those years. Management adopted the provisions of this statement and took them into account in the preparation of the unaudited condensed consolidated financial statements. The adoption of this standard did not have a material impact on the unaudited condensed ~~combined~~consolidated financial statements.

In March 2018, the FASB issued ASU 2018-05, Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. The amendments in this update provide guidance on when to record and disclose provisional amounts for certain income tax effects of the Tax Cuts and Jobs Act ("(“Tax Reform ~~Act"~~Act”). The amendments also require any provisional amounts or subsequent adjustments to be included in net income from continuing operations. Additionally, this ASU discusses required disclosures that an entity must make with regard to the Tax Reform Act. This ASU is effective immediately as new information is available to adjust provisional amounts that were previously recorded. ~~The Company has decided to adopt~~Management adopted the provisions of this ~~new standard; however,~~statement and took them into account in the preparation of the financial statements for the year ended December 31, 2019. The Company currently has no revenue and only net operating loss carryforwards that result in a tax ~~benefit during the six month period ended June 30, 2019.~~benefit. The Company ~~also~~ has no deferred tax assets (offset in full by a valuation allowance) or tax liabilities on its balance sheet as of June 30, ~~2019~~2020 and December 31, ~~2018.~~2019.

In June 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation: Improvements to Nonemployee Share-Based Payment Accounting. This update is intended to reduce cost and complexity and to improve financial reporting for share-based payments issued to non-employees (for example, service providers, external legal counsel, suppliers, etc.). The ASU expands the scope of Topic 718, Compensation—Stock Compensation, which currently only includes share-based payments issued to employees, to also include share-based payments issued to non-employees for goods and services. Consequently, the accounting for share-based payments to non-employees and employees will be substantially aligned. The standard will be applied in a retrospective approach for each period presented. ~~The Company has~~Management adopted the provisions of this ~~standard for~~statement and took them into account in the ~~year ended December 31, 2018. The Company made no share-based payments to non-employees and did not grant stock warrants or stock options for services rendered or goods received during~~preparation of the ~~six month period ended June 30, 2019.~~unaudited condensed consolidated financial statements.

In July 2019, the FASB issued ASU 2019-07, Codification Updates to SEC Sections. The ASU clarifies or improves the disclosure and presentation requirements of a variety of codification topics by aligning them with the SEC’s regulations, thereby eliminating redundancies and making the codification easier to apply. Management adopted the provisions of this statement and took them into account in the preparation of the unaudited condensed consolidated financial statements, and it did not have a material impact on the Company’s reported consolidated financial results.

In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which simplifies the accounting for income taxes, eliminates certain exceptions within ASC 740, Income Taxes,and clarifies certain aspects of the current guidance to promote consistency among reporting entities. ASU 2019-12 is effective for fiscal years beginning after December 15, 2021. Most amendments within the standard are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. The Company is evaluating the effects, if any, of the adoption of ASU 2019-12 guidance on the Company’s financial position, results of operations and cash flows.

In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which address issues identified as a result of the complexity associated with applying generally accepted accounting principles for certain financial instruments with characteristics of liabilities and equity. This amendment is effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.

The Company has suffered recurring losses from operations and has a working capital deficit and ~~stockholders'~~stockholders’ deficit, and in all likelihood, will be required to make significant future expenditures in connection with continuing marketing efforts along with general and administrative expenses. As of June 30, ~~2019,~~2020, the Company has an accumulated deficit ~~is $18,556,562, a~~of approximately $47,700,000. During the six months ended June 30, 2020, the Company also experienced negative cash ~~balance of $4,931, carrying loans of principal and interest in default totaling $1,458,037 and cash outflows~~flows from operating activities of ~~$168,908. These~~$765,791. It appears these principal conditions or events, considered in the aggregate, indicate it is probable that the entity will be unable to meet its obligations as they become due within one year after the date the financial statements are issued. As such, there is substantial doubt about the entity’s ability to continue as a going concern.

On May 25, 2017, the Company increased their number of unauthorized shares from 100,000,000 to 800,000,000 as they hope to raise additional capital through the sale of its equity securities, through an offering of debt securities, or through borrowings from financial institutions or others, and debt restructure (conversion of debt to equity). By doing so, the Company further hopes to generate revenues from sales of its alcohol sensing and ignition lock systems. The Company is currently engaged in talks with potential sales reps, funding sources, and manufacturers.

The Company ~~is also~~has been considering opportunities to create synergy with its SOBR ~~product.~~ product to mitigate the probable conditions that have raised substantial doubt about the entity’s ability to continue as a going concern.

On ~~October 29, 2018,~~May 6, 2019, the Company entered into an Asset Purchase Agreement with IDTEC, LLC (and Amendment No. 1 dated March 9, 2020) (the “APA”), under which IDTEC, LLC (“IDTEC”), an affiliate owned by First Capital Holdings, LLC (“FCH”), agreed to provide personnel, experience, and access to funding to assist with the development of the Company’s SOBR device, as well as to sell to the Company certain robotics assets, which the Company’s management believes are synergistic with its current assets. The APA transaction closed on June 5, 2020 providing the Company with ownership in the SOBR Safe intellectual technology.

On December 12, 2019, the Company entered into a ~~non-binding Letter of Intent (“LOI”~~Series A-1 Preferred Stock Purchase Agreement (the “SPA”) with ~~First Capital Holdings,~~SOBR SAFE, LLC (“~~FCH”~~SOBR SAFE”)~~. The LOI sets forth~~, a Delaware limited liability company and an entity controlled by Gary Graham, one of the ~~terms~~Company’s Directors, under which (i) the Company ~~could potentially~~agreed to create a new series of convertible preferred stock entitled “Series A-1 Convertible Preferred Stock,” with 2,000,000 shares authorized and the following rights: (a) dividend rights of 8% per annum based on the original issuance price of $1 per share, (b) liquidation preference over our common stock, (c) conversion rights into shares of our common stock at $1 per share, (d) redemption rights such that the Company has the right, upon thirty days written notice, at any time after one year from the date of issuance, to redeem all or part of the Series A-1 Convertible Preferred Stock for 150% of the original issuance price, (e) shall not be callable by the Company, and (f) each share of Series A-1 Convertible Preferred Stock will vote on an “as converted” basis; and (ii) SOBR SAFE agreed to acquire ~~certain assets related to robotics equipment from FCH~~1,000,000 shares of the Company’s Series A-1 Convertible Preferred Stock (the “Preferred Shares”), once created, in exchange for ~~shares~~$1,000,000 (the “Purchase Price”). The Company received the Purchase Price on December 12, 2019 and has not issued these Preferred Shares as of their common stock equal to 60% of our then outstanding common stock on a fully-diluted basis. The LOI is non-binding and subject to various conditions that must be met in order for the parties to close the transaction, including, but not limited to, (i)June 30, 2020: however, the Company ~~being current~~plans to issue these Preferred Shares in ~~its reporting requirements under~~Summer 2020. As a result of the ~~Securities Exchange Act of 1934, as amended, (ii)~~offering, the Company ~~completing~~has a ~~reverse stock split~~cash balance of $727,633 and $681,759 at June 30, 2020 and December 31, 2019, respectively.

On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the “COVID-19 outbreak”) and the risks to the international community as the virus spreads globally beyond its ~~common stock such that approximately 8,000,000 shares will be outstanding immediately prior~~point of origin. In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. The full impact of the COVID-19 outbreak continues to ~~closing~~evolve as of the ~~transaction with no convertible instruments other than as set forth herein, (iii)~~date of this Annual Report. Management is actively monitoring the global situation on its financial condition, liquidity, operations, suppliers, industry, and workforce. Given the daily evolution of the COVID-19 outbreak and the global responses to curb its spread, the Company ~~having no more than $125,000 in outstanding debt, all in~~is not able to estimate the ~~form of convertible notes that mature in two years post-closing and are convertible into shares of TransBiotec common stock at $2.00 per share; (iv) FCH completing any necessary audits and reviews~~effects of the COVID-19 outbreak on its results of operations, financial ~~statements related to~~condition, or liquidity for fiscal year 2020. However, if the ~~assets by a PCAOB-approved independent registered accounting firm,~~pandemic continues, it will have an adverse effect on the Company’s results of future operations, financial position, and ~~(v) the parties executing definitive documents related to the potential transaction. On March 6, 2019, the parties entered into an amendment No. 1 to the LOI~~liquidity in order to extend certain dates in the LOI namely : (i) the date for the parties to complete initial due diligence was moved to March 29, 2019 (ii) the date for the parties to execute definitive agreements related to the transaction was moved to May 6, 2019, and (iii) the date to close the transaction was tentatively moved to August 31, 2019 (the “Amendment No.1”). On May 6, 2019, TransBiotec,year 2020.

SOBR Safe, Inc. (“The Company” or “TransBiotec” and “Buyer”) entered into an asset purchase agreement with IDTEC, LLC (“Seller”) in which TransBiotec agreed to acquire the Seller’s rights, title and interest to and in certain assets. The aggregate purchase price for the purchased assets shall be 12 million (12,000,000) restricted shares of the $0.00001 par value common stock of the Buyer; provided that the total number of shares of TransBiotec’s $0.00001 par value common stock issued and outstanding following a tentative closing date of January 31,

June 30, 2020 ~~shall not exceed 20 million (20,000,000) shares (on a fully dilated basis).~~

Management believes actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern; however, these plans are contingent upon actions to be performed by the Company and ~~this performance has~~these conditions have not ~~occurred~~been met on or before June 30, ~~2019.~~2020. Additionally, the COVID-19 outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown, which would impair the Company’s ability to raise needed funds to continue as a going concern. As such, substantial doubt about the entity’s ability to continue as a going concern ~~has~~was not ~~been~~ alleviated as of June 30, ~~2019.~~2020.

On June 5, 2020, the Company completed a transaction (the “Transaction”) with IDTEC subject to the terms and conditions of the APA and that was accounted for as an asset purchase. Pursuant to the APA, IDTEC provided personnel, experience, and access to funding to assist with the development of the SOBR device, as well as sold to us certain robotics assets, which our management believes are synergistic with our current assets, in exchange for 12,000,000 shares of our common stock after giving effect to the reverse stock split effected in connection with closing the Transaction. The closing of the Transaction was subject to several conditions precedent, primarily: (i) the Company had to be current in reporting requirements under the Securities Exchange Act of 1934, as amended, (ii) had to complete a reverse stock split of common stock such that approximately 8,000,000 shares were outstanding immediately prior to closing the transaction, (iii) could only have outstanding convertible instruments as set forth in the APA, (iv) authorized common stock had to be reduced to 100,000,000 shares, and (v) not have more than approximately $125,000 in current liabilities. Effective with the closing of the Transaction all of the closing conditions had been met, modified or waived by IDTEC, and the Company issued the 12,000,000 shares to IDTEC.

In advance of closing the Transaction, IDTEC and a few other affiliated parties voluntarily committed personnel and funds to the Company to assist with (i) general costs related to the Transaction, (ii) ongoing operating expenses and pay for further engineering and development work on the Company’s products and prototypes, (iii) protect, maintain and develop the Company’s products and intellectual property, (iv) hire, pay and retain the proposed management team, third party consultants and advisors for the Company following the consummation of the sale contemplated in the APA and, (v) take such further actions as are necessary to more quickly expand the Company’s business subsequent to the sale of the purchased assets. The parties agreed that the funds advanced directly to the Company’s vendors were voluntary and were not the obligation of the Company and the Company had no obligation to repay these funds in the event the transaction contemplated by the APA did not close. In the event the Transaction did close, then on the closing date, the Company would issue promissory notes for the aggregate amounts incurred, paid or advanced. As a result of closing the Transaction, the Company issued a convertible promissory note for all the funds spent or advanced by IDTEC prior to closing. This note totaled $1,485,189 (the “APA Note”), carries a simple interest at 10% per annum, is due upon demand, and may be convertible into shares of common stock at $0.50 per share (after giving effect to the reverse stock split and subject to anti-dilution protection against any future securities we may issue at an effective price of less than $0.50 per share) at the discretion of the holder. The repayment of APA Note is secured by a first priority security lien or security interest in the patents, trademarks, tradenames, and other intellectual property of the Company.

At closing, some of the closing conditions under the APA were either waived and/or modified by the parties. In ~~May 2011, the Company~~order to document those modifications and waivers, we entered into ~~an employment agreement~~a Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement with ~~Mr. Bennington which expired on December 31, 2017. The employment agreement provided~~IDTEC. One of the closing conditions that was the subject of the Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement was the requirement that the Company ~~would pay Mr. Bennington a salary of $120,000 during the first year~~have under $125,000 in permitted liabilities (not including aged liabilities) after closing of the ~~agreement, $156,000 during~~Transaction. At closing we had approximately $158,000 in non-permitted liabilities under the ~~second year of the agreement, $172,000 during the third year of the agreement, $190,000 during the fourth year of the agreement and $208,000 during the fifth year of the agreement. Since~~APA. As a result, the Company ~~was unable~~issued a Warrant to ~~compensate him as stipulated per the agreement, Mr. Bennington agreed~~Purchase Common Stock to drop his yearly compensation, and resulting yearly accrual, to $120,000 per year with no yearly increases as stipulated in years 2 through 5. In September 2016, before the expiration of Mr. Bennington’s contract, the Company appointed Ivan Braiker as its sole CEO, and Mr. Bennington subsequently took a role as a member of the Board of Directors at a monthly rate of $5,000. In connection with his appointment, Mr. Braiker entered into a letter agreement with the Company,IDTEC (the “Warrant”), under which ~~he accrued a monthly retainer of $7,500,~~IDTEC will purchase up to ~~be paid only if the Company successfully closed financing of at least $200,000. Mr. Braiker was also granted options to purchase 1,500,000~~320,000 shares of our common stock (post-split) at an exercise price of ~~$0.0045~~$0.50 per share, if either (i) we are forced to pay a non-permitted liability, then we may force IDTEC to exercise the Warrant and pay the exercise price to pay the non-permitted liability, but only in an amount sufficient to pay the non-permitted liability, or (ii) if IDTEC otherwise elects to exercise the Warrant and acquire some or all of the shares underlying the Warrant. The Warrant expires five years after the date of issuance.

The Transaction recorded as an asset purchase was valued at a$29,222,955, which consists of the market price as of June 5, 2020 of the Company’s 12,000,000 shares of common stock issued totaling $27,120,000, the funds spent by IDTEC and affiliates prior to closing of $1,407,051 and the fair value of ~~$6,290. In an act~~the Warrant issued of ~~good faith by~~$695,454.

Subsequent to the Transaction closing, the Company ~~Mr. Braiker was paid $15,000 in 2017 in relation~~evaluated the fair value of the assets acquired based on market estimates for property and equipment and discounted net cash flow for the SOBR Safe intellectual technology. The present value of the discounted cash flow utilized a 75% discount, which included a 25% risk return premium, over an estimated five-year net revenue stream expected to ~~his letter agreement. Effective with his resignation~~be derived from the technology acquired. Based on ~~December 31, 2017,~~the assessment of fair value, the Company ~~did not owe, accrue for or pay Mr. Braiker any further compensation~~recognized an asset impairment loss of $25,320,555 resulting from the APA during the three-month period ended June 30, 2020. The impairment was due to the increase of the Company’s stock price value. The stock price of the Company at closing of the Transaction was significantly higher than expected from the stock price of the Company when the Company signed the APA. The number of shares to be given to IDTEC as ~~he was unable to secure financing of $200,000~~consideration for the ~~Company as stipulated per the letter agreement. Mr. Braiker was~~Transaction would not ~~compensated~~get updated for ~~his services as a member of our Board of Directors.~~any stock price changes.

AsIn determining the fair value of the intangible assets, the Company considered, among other factors, the best use of acquired assets such as the analysis of historical financial performance of the products and estimates of future performance of the products and intellectual properties acquired. The preliminary establishment of the allocation to identifiable intangible assets required extensive use of financial information and management’s best estimate of fair value. The Company has preliminarily recorded the purchase price of the identified intangible assets and is, if applicable, amortizing such assets over their estimated useful lives of ten years. The assessment of fair value is preliminary and is based on information that was available to management at the time the unaudited condensed consolidated financial statements were prepared. Measurement period adjustments will be recorded in the period in which they are determined, as if they had been completed at the acquisition date. Accordingly, differences between these preliminary estimates and the final allocation to the intangible assets may occur and these differences could have a material impact on the accompanying consolidated financial statements.

Depreciation is computed on a straight-line basis over the assets estimated useful lives of three years. Depreciation for the three and six months ended June 30, ~~2019~~2020 was $1,105. There was no depreciation for the three and ~~December 31, 2018,~~six months ended June 30, 2019.

Intangible assets consist of the ~~Company had payables due to officers~~following at June 30, 2020:

Amortization expense for ~~accrued compensation~~the three and ~~services of $595,000~~six months ended June 30, 2020 was $32,122. There was no amortization expense for the three and ~~$474,156, respectively, recorded~~six months ended June 30, 2019.

Estimated future amortization expense for device intellectual technology intangible assets is as related party payables on the condensed consolidated balance sheets. Due to cash flow constraints, the Company has experienced difficulty in compensating its directors for their service in their capacity as directors; therefore, such directors may receive stock options to purchase common shares as awarded by its Board of Directors or (as to future stock options) a compensation committee which may be established. Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with business related travel and attendance at meetings of its Board of Directors. The Company’s Board of Directors may award special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director.follows:

On December 3, 2014, Lanphere Law Group, a related party and the Company’s largest shareholder, entered into an agreement with the Company to convert 50% of its outstanding accounts payable of $428,668 to a note payable. This note payable represents one half of the balance in the amount of $214,334 of ~~attorney~~legal fees and costs owed up until October 31, 2014. This agreement further provided that the remaining 50% of unpaid legal fees in accounts payable were to be paid and retained as a current payable. In addition, 50% of the ~~attorney~~legal fees and costs incurred ~~starting from~~beginning with the legal services provided to the Company on November 1, 2014 are to be converted on a monthly basis to common stock at a price of $0.09 per share until the accounts payable balance for ~~attorney~~legal fees is paid current. ~~These payables were for legal expenses recorded to general and administrative expense as incurred.~~ The Company has recorded to equity, a total related party gain connected to these conversions during the six month period ended June 30, 2020 and 2019 of none and ~~2018 of~~ $15,522, respectively. The Company converted the remaining payables to common stock through a separate agreement and ~~$15,143, respectively. Per this agreement~~there are no more payables to convert as of June 30, 2019 and December 31, 2018, on a cumulative basis, approximately $201,831 of related party payables was converted into 2,242,565 common shares and $201,831 was converted into 2,242,565 common shares, respectively. The Company has a stock subscription payable due to Lanphere Law Group as of June 30, 2019 of $2,058 convertible into 424,479 of its common shares, and $1,271 convertible into 243,273 of its common shares as of December 31, 2018.

On July 1, 2015, the Company amended the December 3, 2014 note payable agreement with Lanphere Law Group, a related party and the Company’s largest shareholder, which forgave $108,000 of the note payable’s principal balance. This debt forgiveness ~~brought down~~decreased the original principal balance on the note of $214,334 to a new principal balance of $106,335, and a related party gain of $108,000 was recorded to additional paid-in capital. This amendment also extended the note payable’s due date to December 2, ~~2015; however, this~~2015. The note ~~is currently in default.~~was converted to common stock during the three months ended March 31, 2020.

On March 8, 2017, Lanphere Law Group, a related party and the Company’s largest shareholder, irrevocably elected to exercise warrants in order to acquire ~~32,248,932~~969,601 shares of the Company’s common stock in exchange for an aggregate exercise price of $112,871, which was used for the deduction of $74,672 of principal and $38,199 of accrued interest related to the December 3, 2014 note payable agreement with Lanphere Law Group. The principal balance of the note after the debt deduction was $31,662. At June 30, 2019 and December 31, 2018, the principal balance of this note was $31,662 and $31,662, respectively. At June 30, 2019 and December 31, 2018, the accrued interest on this note was $7,910 and $5,539, respectively. The forgiveness of the note payable principal of $74,672 was recorded to equity and the $38,199 of related accrued interest was also recorded to equity. The principal balance of the note after the debt deduction was $31,662. On January 3, 2020, the note payable principal balance of $31,662 was converted to 9,520 common shares at a per share price of $3.326. As of June 30, 2020 and December 31, 2019, the principal balance of this note was none and $31,662, respectively. As of June 30, 2020 and December 31, 2019, the accrued interest on this note was none and $9,508, respectively.

On January 3, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with Michael Lanphere, one of the Company’s officers, under which he agreed to exercise and the Company agreed to issue 454,097 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Lanphere under two promissory notes. Mr. Lanphere’s option to acquire the shares was under the terms of certain Loan Agreement with Promissory Note and Stock Fees agreements entered into with the Company and Mr. Lanphere on April 17, 2019 and July 17, 2019. The amount of the debt reduction, and therefore the purchase price of the shares, was $65,875 which was used for the deduction of related party notes payable principal of $65,875. 180,397 common shares were issued on January 3, 2020 at an effective conversion price of $0.133 and 273,700 common shares were issued on January 3, 2020 at an effective conversion price of $0.153. After this exercise, Lanphere Law Group ~~still~~ owns no warrants ~~to acquire an additional 27,400,745~~for shares of our common stock.

~~The~~On January 3, 2020, the Company entered into ~~a lease agreement~~another Debt Conversion and Common Stock Purchase Plan with Michael Lanphere, ~~Law Group, a related party and~~one of the Company’s ~~largest shareholder, whereas~~officers, under which the Company ~~is the tenant and is paying monthly rent of $4,100. The term of this operating lease runs from July 1, 2015~~agreed to June 30, 2019. As of July 1, 2019, the Company leases the same office space on a month to month basis. Rent expense, including CAM charges, for the six month period ended June 30, 2019 and 2018 of $26,210 and $26,210, respectively, was recorded to general and administrative expense.

~~On April 30, 2018, Daljit Khangura, a related party, irrevocably elected to exercise options in order to acquire 450,000~~issue 63,225 shares of ~~the Company’s~~its common stock in exchange for ~~an aggregate exercise~~a reduction in the amounts owed to Mr. Lanphere under numerous other remaining promissory notes. The amount of the debt reduction, and therefore the purchase price of ~~$4,500,~~the shares, was $210,285 which was used ~~as stock compensation~~ for ~~consulting services provided as a member~~the deduction of related party notes payable principal of $169,606 and accrued interest of $40,679. Based on the fair value of the ~~Board of Directors. Mr. Khangura was~~shares issued, ~~an additional 50,000 shares of the Company’s common stock with a value of $500, which was also used as stock compensation for consulting services provided as a member of the Board of Directors.~~

~~On April 30, 2018,~~ the Company ~~converted $7,500 to Nick Noceti,~~recognized a related party gain of approximately $52,000 and accounted for ~~executive compensation into 750,000~~it as additional paid-in capital. The common shares were issued ~~shares~~on January 3, 2020 at an effective conversion price of ~~common stock at $0.01~~$3.326 per share.

On January 3, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with Vernon Justus, a related party, under which the Company agreed to issue 84,963 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Justus under a promissory note. The amount of the debt reduction, and therefore the purchase price of the shares, was $282,588 which was used for the deduction of a related party note payable principal of $180,001 and accrued interest of $102,587. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $70,000 and accounted for it as additional paid-in capital. The common shares were issued on January 3, 2020 at an effective conversion price of $3.326 per share.

On January 16, 2020, the Company entered into a Accounts Payable Conversion and Common Stock Purchase Plan with Michael Lanphere, one of the Company’s officers, under which the Company agreed to issue 214,883 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Lanphere for unpaid legal bills. The amount of the debt reduction, and therefore the purchase price of the shares, was $714,700 which was used for the deduction of related party payables of $714,700. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $222,000 and accounted for it as additional paid-in capital. The common shares were issued on January 16, 2020 at an effective conversion price of $3.326 per share.

On January 30, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with Devadatt Mishal, one of the Company’s directors, under which the Company agreed to issue 499,965 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Mishal under numerous promissory notes. The amount of the debt reduction, and therefore the purchase price of the shares, was $456,641 which was used for the deduction of related party notes payable principal of $270,300 and accrued interest of $186,500. The Company also recorded a loss on related party debt extinguishment of approximately $144,000. The common shares were issued on January 30, 2020 at an effective conversion price of $0.91465 per share.

~~NOTE 4. NOTES PAYABLE~~On March 23, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with Prakash Gadgil, one of the Company’s former directors, under which the Company agreed to issue 586 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Gadgil under a promissory note. The amount of the debt reduction, and therefore the purchase price of the shares, was $1,950 which was used for the deduction of a related party note payable principal of $1,950. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $1,000 and accounted for it as additional paid-in capital. The common shares were issued on March 23, 2020 at an effective conversion price of $3.326 per share.

~~RELATED PARTIES~~On April 6, 2020, the Company agreed with Nick Noceti, the Company’s former Chief Financial Officer, to issue 38,437 shares of its common stock in exchange for amounts due for accounting fees included in accounts payable. The amount of the debt reduction, and therefore the purchase price of the shares, was $127,840 which was used for the deduction of a related party accounts payable of $127,480. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $49,000 and accounted for it as additional paid-in capital. The common shares were issued on April 4, 2020 at an effective conversion price of $3.326 per share.

On April 7, 2020, the Company agreed with Charles Bennington, one of the Company’s former directors, to issue 6,831 shares of its common stock in exchange for amounts due for Board of Director fees included in accounts payable. The amount of the debt reduction, and therefore the purchase price of the shares, was $9,656 which was used for the deduction of a related party accounts payable of $9,656. Based on the fair value of the shares issued, the Company recognized a related party gain of approximately $2,000 and accounted for it as additional paid-in capital. The common shares were issued on April 7, 2020 at an effective conversion price of $1.41 per share.

The Company has ~~four~~ convertible notes payable to related parties that have a principal balance of ~~$91,000~~$1,485,189 and ~~$91,000~~$161,000 as of June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, respectively. These notes carry interest rates of 9%10% and ~~have~~are due ~~dates ranging from 1/23/2014 - 4/8/2015. All four notes are currently in default and carry a default interest rate of 10%. These~~on demand. The notes carry fixed and variable conversion prices ~~ranging from $0.0072 - $0.0800~~ per ~~share.~~share at June 30, 2020. The Company evaluated these convertible notes payable for derivative embedded conversion features and beneficial conversion features. The Company determined that ~~for the~~there were both derivative embedded conversion ~~option, there was a~~features and beneficial conversion ~~value~~features to record. The ~~beneficial~~ conversion ~~feature was~~features were either fully amortized upon grant or over the life of the convertible notes ~~one year, and was~~payable. The conversion features were fully amortized atas of June 30, ~~2019~~2020 and December 31, ~~2018. No~~2019. During the six months ended June 30, 2020 and 2019, beneficial conversion feature amortization expense related to these convertible notes payable of $1,485,189 and none, respectively, was accounted for as amortization of interest - beneficial conversion feature expense ~~was incurred during~~in the condensed consolidated statements of operations. During the six ~~month period~~months ended June 30, 2020 and 2019, derivative embedded conversion feature amortization expense related to these convertible notes payable of $0 and ~~2018.~~$56,100 respectively, was accounted for as interest expense in the condensed consolidated statements of operations. During the three months ended March 31, 2020, the Company entered into a Debt Conversion and Common Stock Purchase Plan with a related party, under which the Company agreed to issue 156,474 shares of its common stock in exchange for a reduction of four convertible notes payable to related parties. The amount of the debt reduction, and therefore the purchase price of the shares, was $143,119 which was used for the deduction of related party convertible notes payable principal of $91,000 and accrued interest of $52,119.

The Company has ~~ten~~a non-convertible notes payable to related parties principal balance of $11,810 and $328,423 as of June 30, 2020 and December 31, 2019, respectively. The principal balance consist of one zero interest note payable with a due date of December 31, 2012. This note is currently in default. During the three months ended March 31, 2020, the Company converted eight non-convertible notes payable to related parties that ~~have~~had a principal balance of ~~$343,700~~$316,613. During the three months ended March 31, 2020, the Company entered into Debt Conversion and ~~$343,700 as~~Common Stock Purchase Plans with four related parties, under which the Company agreed to issue 342,399 shares of ~~June 30, 2019 and December 31, 2018, respectively. These~~its common stock in exchange for a reduction of eight non-convertible notes ~~carry interest rates ranging from 0% - 10% and have due dates ranging from 8/03/2012 - 11/28/2016. Nine~~payable to related parties. The amount of the ~~ten~~debt reduction, and therefore the purchase price of the shares, was $549,311 which was used for the deduction of related party non-convertible notes ~~are currently in default~~payable principal of $316,613 and ~~carry a default~~accrued interest ~~rate~~ of ~~10%.~~$232,698.

The Company has ~~thirty~~a notes payable with detached free-standing warrants to related parties ~~that have a~~ principal balance of ~~$345,894~~none and ~~$271,144~~$280,119 as of June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, respectively. These notes ~~carry~~carried interest rates ranging from 7% - 10% and ~~have~~had due dates ranging from 8/08/05/2015 -– 03/30/2020. ~~Twenty-eight of the thirty notes, carrying a total principal balance of $336,144, are currently in default and carry a default interest rate of 10%.~~ The exercise price for each note payable with detached free-standing ~~warrant ranges~~warrants ranged from ~~$0.0018664652~~$0.03 - ~~$0.0160.~~$0.53. As of June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, these notes carried outstanding detached free-standing warrants of ~~40,535,165~~none and ~~23,953,003,~~454,097, respectively. The unamortized discount ~~related to these warrants~~ at June 30, ~~2019~~2020 and December 31, ~~2018~~2019 is ~~$28,011~~none and ~~$8,074,~~$8,656, respectively. During the ~~six month~~six-month period ended June 30, ~~2019~~2020 and ~~2018,~~2019, stock warrants amortization expense recorded toas interest expense was $8,656 and $15,093, ~~and $22,517,~~ respectively. ~~The reason for the decrease in stock warrants expense was directly related to the timing of funds borrowed and the related amortization of its stock warrants.~~ The relative fair market value of the related stock warrants granted during the ~~six month~~six-month period ended June 30, 2020 and 2019 was none and ~~2018 was~~ $35,030, respectively. During the three months ended March 31, 2020, the Company entered into Debt Conversion and ~~$29,701, respectively.~~Common Stock Purchase Plans with two related parties, under which the Company agreed to issue 601,783 shares of its common stock in exchange for a reduction of 24 notes payable with detached free-standing warrants to related parties. The ~~fair market value~~amount of the ~~outstanding stock~~debt reduction, and therefore the purchase price of the shares, was $320,858 which was used for the deduction of related party notes payable with detached free-standing warrants ~~was calculated utilizing the Black-Sholes method using the following assumptions: risk free rates ranging between 2.31% - 2.53%, dividend yield~~principal of ~~0%, expected life~~$280,119 and accrued interest of ~~5 years, volatility between 135% - 138%.~~$40,739.

Total interest expense for related party notes was ~~$43,235~~$42,161 and ~~$39,446~~$43,235 for the ~~six month~~six-month period ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively.

The Company has ~~eighteen~~ convertible notes payable to non-related parties that have a principal balance of ~~$203,136~~$56,683 and $143,136 as of June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, respectively. These notes carry interest rates ranging from 5% - 30% and have due dates ranging from ~~10/30/2012 - 5/23/2019. Sixteen~~2/20/2013 – 3/06/2022. Three of the ~~eighteen~~four notes ~~carrying a total principal balance of $143,136,~~ are currently in ~~default and carry a default interest rate of 10%.~~default. These notes carry conversion prices ranging from ~~$0.0017- $0.3235688~~$1.99 - $10.76 per share. ~~On March 1, 2019 and May 3, 2019, the Company entered into convertible note payable agreements that converts to its common stock at a variable conversion price. As further discussed in~~ ~~Note 5 – Derivative Liability~~, the Company analyzed the conversion features of the note agreement for derivative accounting consideration under ASU 2017-11 (ASC 815-15 Derivatives and Hedging), and determined the embedded conversion features should be classified as a derivative because the exercise price of the convertible note is subject to a variable conversion rate. The Company evaluated these convertible notes payable for derivative embedded conversion features and beneficial conversion features. The Company determined that ~~an embedded~~there were beneficial conversion ~~feature was recorded. Unamortized debt discount related~~features to ~~these~~record. The conversion features were either fully amortized upon grant or over the life of the convertible notes ~~was $44,257 and $5,920~~payable. The conversion features were fully amortized as of June 30, ~~2019~~2020 and December 31, ~~2018, respectively. Beneficial~~2019. During the six months ended June 30, 2020 and 2019, beneficial conversion feature amortization expense related to these convertible notes payable of none and $5,356, respectively, was accounted for as amortization of interest - beneficial conversion feature expense ~~incurred was $17,763 and none during~~in the ~~six~~condensed consolidated statements of operations. During the three month period ended March 31, 2020, the Company entered into Debt Conversion and Common Stock Purchase Plans with six non-related parties, under which the Company agreed to issue 50,135 shares of its common stock in exchange for a reduction of eleven convertible notes payable to non-related parties. The amount of the debt reduction, and therefore the purchase price of the shares, was $166,749 which was used for the deduction of non-related party convertible notes payable principal of $83,952 and accrued interest of $82,797. The Company recorded a non-related party gain on loan extinguishment of approximately $68,000. During the three months ended March 31, 2020, the Company also entered into a non-related party convertible note payable agreement to convert a high interest rate convertible non-related party note payable with a principal balance of $25,000 and accrued interest due of $22,500 to a non-related party convertible note payable of $47,500 that accrues interest at 5%. The note conversion rate is $2 per common share. The Company recorded a loss on non-related party debt extinguishment of $11,697. On June 9, 2020, the holder of a $25,000 convertible promissory note with interest at 30% and accrued interest of $61,875 replaced the carrying amount of the note and its conversion features with a new non-convertible note totaling $47,500 that bears interest at 5%. The Company recorded a gain on non-related party debt extinguishment of $61,875.

The Company has ~~three~~ non-convertible notes payable to non-related parties that have a principal balance of ~~$21,438~~$84,165 and $21,438 as of June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, respectively. These notes carry interest rates ranging from 9%1% - ~~18%~~10% and have due dates ranging from ~~1/31/~~12/27/2013 - ~~11/28/2015. All three~~6/6/2022. Two of the four notes are currently in ~~default~~default. During the three month period ended March 31, 2020, the Company entered into a Debt Conversion and ~~carry~~Common Stock Purchase Plan with a ~~default~~non-related party, under which the Company agreed to issue 20,313 shares of its common stock in exchange for a reduction of his non-convertible non-related party note payable. The amount of the debt reduction, and therefore the purchase price of the shares, was $67,561 which was used for the deduction of non-related party non-convertible notes payable principal of $3,938 and accrued interest ~~rate~~ of ~~10%.~~$63,623. The Company recorded a non-related party gain on loan extinguishment of $39,000. On May 12, 2020, the Company received proceeds of $41,665 from a commercial bank under the SBA Payroll Protection Loan Program. The loan requires interest at 1% and 18 monthly payments of principal and interest beginning December 5, 2020. Provisions of the SBA Payroll Protection Loan Program allow for portions or all the loan balance to be forgiven should certain criteria be met. The Company expects that it will meet the criteria for the full of amount of loan forgiveness.

The Company has one note payable with detached free-standing warrants to a non-related party that has a principal balance of $5,000 and $5,000 as of June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, respectively. This note carries an interest rate of 10% and had a due date of 9/11/2014. This note is currently in default. The ~~exercise price for the attached warrants is $0.019 for a total amount of 50,000 common shares. At June 30, 2019 and December 31, 2018, this note carried outstanding~~ detached free-standing warrants ~~of none~~for this note payable were not exercised by the note holder and 50,000, respectively. There was no unamortized discount related to these warrants as of June 30, 2019 and December 31, 2018, and no stock warrant amortization expense was recorded to interest expense during the six month period ended June 30, 2019 and 2018.expired on May 16, 2019.

Total interest expense for non-related party notes was ~~$28,762~~$10,885 and ~~$24,371~~$28,762 for the six month period ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively.

~~On March 1,~~In 2019, the Company borrowed ~~$29,000~~$ 70,000 under a convertible promissory ~~note~~notes agreement from an unrelated party that isare due upon ~~demand from the investor. On May 3, 2019, the Company borrowed $31,000 under a convertible promissory note agreement from an unrelated party that is due upon demand from the investor. Both~~demand. The notes bear interest at a rate of 10% per annum and are convertible into the Company’s common shares at a variable conversion price based on a 50% discount of the market price at an undetermined future date. The Company analyzed the conversion features of the note agreement for derivative accounting consideration under ASU 2017-11 (ASC 815-15 Derivatives and Hedging), and determined the embedded conversion features should be classified as a derivative because the exercise price of the convertible note is subject to a variable conversion rate and should therefore be ~~therefore~~ accounted for at fair value under ASC 820, Fair Value Measurements and Disclosures, and ASC 825, Financial ~~Instruments.~~Instruments. In accordance with ASC 815-15, the Company has bifurcated the conversion feature of the note and recorded a derivative liability.

The embedded derivative for the notes is carried on the Company’s balance sheet at fair value. The derivative liability is marked to market each measurement period and any unrealized change in fair value is recorded as a component of the statement of operations and the associated fair value carrying amount on the balance sheet is adjusted by the change. The Company fair values the embedded ~~derivative~~derivatives using a Monte Carlo simulation model based on the following assumptions: (1) expected volatility ~~from 280% to 350%~~of 180%, (2) risk-free interest rate ~~from 1.96% to 2.55%~~of 0.13%, and (3) expected life offrom 1 month to 1 year. On March 1, 2019, the date of the first note, the fair value of the embedded derivative was $28,000. On May 3, 2019, the date of the second note, the fair value of the embedded derivative was $28,100. On October 26, 2019, the date of the third note, the fair value of the embedded derivative was $8,700. The notes carried an embedded conversion feature of ~~$56,100~~$64,800 that ~~is recorded as a discount on~~was fully amortized to interest expense during the ~~balance sheet that will be amortized over~~year ended December 31, 2019. The notes were not converted and deemed paid in full at the ~~life of each respective note. Interest amortization expense~~closing of the ~~embedded conversion feature for~~Transaction on June 5, 2020. The principal amount of these notes ~~is $13,946~~were settled and transferred to the APA Note and a loss on debt extinguishment of $273,462 was recognized during the ~~six month~~six-month period ended June 30, ~~2019.~~2020. The fair value of the embedded derivative ~~is $52,900 and is~~ recorded on the balance sheet as a ~~derivative~~ liability was none and $60,650 at June 30, ~~2019. The note was not converted during the six month period June 30, 2019.~~2020 and December 31, 2019, respectively. Utilizing level 3 inputs, the Company recorded a fair market value gain of ~~$3,200 and none~~$60,650 during the six ~~month~~months ended June 30, 2020 and a gain of $3,200 during same period ended June 30, ~~2019 and 2018, respectively.~~2019.

Balance at December 31, 2018

$ -

Fair value of derivatives issued

56,100

Fair market value adjustments

(3,200 )
Balance at June 30, 2019

$ 52,900

The Company has common stock subscriptions payable due to related parties of $79,624 payable with 89,077 of its common shares at June 30, 2020. The Company has common stock subscriptions payable due to related parties of $79,624 payable with 89,077 of its common shares at December 31, 2019. The Company recorded a related party gain of none and $15,522 related to the outstanding common stock subscriptions payable during the six month period ended June 30, 2020 and 2019, respectively.

The Company has common stock subscriptions payable due to non-related parties of $20,503 payable with 15,108 of its common shares at June 30, 2020. The Company had no common stock subscriptions payable due to non-related parties at December 31, 2019.

The Company has preferred stock subscriptions payable due to related parties of $1,770,000 payable with 1,770,000 of its 8% Series A-1 Convertible Preferred shares as of June 30, 2020. The Company has preferred stock subscriptions payable due to related parties of $1,000,000 payable with 1,000,000 of its 8% Series A-1 Convertible Preferred shares as of December 31, 2019.

On February 25, 2019, the Company issued 1,065,982 shares of its common stock to non-related parties for $39,000 in cash.

On January 3, 2020, the Company converted $34,534 of non-related party debt into 10,383 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $6,907 as other income in the consolidated statements of operations.

On January 3, 2020, the Company converted $6,482 of non-related party debt into 1,949 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $1,296 as other income in the consolidated statements of operations.

On January 3, 2020, the Company converted $39,356 of non-related party debt into 11,833 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $7,871 as other income in the consolidated statements of operations.

On January 3, 2020, the Company converted $97,624 of non-related party debt into 29,352 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $19,525 as other income in the consolidated statements of operations.

On January 3, 2020, a related party exercised 273,700 stock warrants and in exchange converted $41,875 in related party debt owed to him under a promissory note. The shares were issued at a value of $0.1530 per share pursuant to the terms of the convertible note.

On January 3, 2020, a related party exercised 180,397 stock warrants and in exchange converted $24,000 in related party debt owed to him under a promissory note. The shares were issued at a value of $0.13304 per share pursuant to the terms of the convertible note.

On January 3, 2020, the Company converted $210,285 of related party debt into 63,225 issued shares of its common stock at $3.326 per share and recorded a related party gain of $42,057 to additional paid-in capital.

On January 3, 2020, the Company converted $282,588 of related party debt into 84,963 issued shares of its common stock at $3.326 per share and recorded a related party gain of $56,518 to additional paid-in capital.

On January 16, 2020, the Company converted $40,000 of non-related party accounts payable into 12,026 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $22,840 as other income in the consolidated statements of operations.

On January 16, 2020, the Company converted $87,464 of non-related party accounts payable into 26,297 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $49,942 as other income in the consolidated statements of operations.

On January 16, 2020, the Company converted $714,700 of related party payables into 214,883 issued shares of its common stock at $3.326 per share and recorded a related party gain of $408,094 to additional paid-in capital.

On January 22, 2020, the Company converted $23,814 of non-related party debt into 7,160 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $14,289 as other income in the consolidated statements of operations.

On January 30, 2020, the Company converted $456,641 of related party debt into 499,965 issued shares of its common stock at $0.9146 per share and recorded a related party gain of $456,634 to additional paid-in capital. The Company recorded a loss on debt extinguishment of $143,660 as other expense in the consolidated statements of operations.

On March 15, 2020, the Company converted $32,500 of non-related party debt into 9,771 issued shares of its common stock at $3.326 per share and recorded a non-related party gain of $19,240 as other income in the consolidated statements of operations.

On March 20, 2020, the Company issued 601 common shares at $34.59 per share to a non-related party as stock compensation for services provided.

On March 23, 2020, the Company converted $1,950 of related party debt into 586 issued shares of its common stock at $3.326 per share and recorded a related party gain of $1,073 to additional paid-in capital.

On April 1, 2020, the Company converted $43,750 of non-related party debt into 75,165 issued shares of its common stock at $.5821 per share and recorded a non-related party loss of $43,743 as other expense in the consolidated statements of operations.

On April 6, 2020, the Company issued 38,437 shares of its common stock to a related party in exchange for their agreement to settle a related party accounts payable of $127,840 owed to them. The shares were issued at a value of $79,133 and recorded a related party gain of $48,707 to additional paid-in-capital.

On April 7, 2020, the Company issued 6,831 shares of its common stock to a related party in exchange for their agreement to settle an accounts payable balance of $9,656 owed to them. The shares were issued at a value of $7,621 and recorded a related party gain of $2,035 to additional paid-in-capital.

On April 20, 2020, the Company agreed to convert 9,346 shares of its common stock at $1.039 per share to a non-related party in exchange for their agreement to settle a payable balance of $9,714 owed to them. The conversion was in full satisfaction of all outstanding amounts owed. The Company recorded a non-related party loss of $854 as other expense in the consolidated statements of operations.

On April 21, 2020, the Company agreed to convert 36,560 shares of its common stock at $1.039 per share to a non-related party in exchange for their agreement to settle a payable balance of $38,000 owed to them. The conversion was in full satisfaction of all outstanding amounts owed. The Company recorded a non-related party loss of $37,270 as other expense in the consolidated statements of operations.

On November 20, 2015, the Company’s Board of Directors authorized a class of stock designated as preferred stock with a par value of $0.00001 per share comprising 25,000,000 shares, 3,000,000 shares of which were classified as Series A Convertible Preferred Stock. In each calendar year, the holders of the Series A Convertible Preferred Stock are entitled to receive, when, as and if, declared by the Board of Directors, out of any funds and assets of the Company legally available, non-cumulative dividends, in an amount equal to any dividends or other Distribution on the common stock in such calendar year (other than a Common Stock Dividend). No dividends (other than a Common Stock Dividend) shall be paid and no distribution shall be made with respect to the common stock unless dividends shall have been paid or declared and set apart for payment to the holders of the Series A Convertible Preferred Stock simultaneously. Dividends on the Series A Convertible Preferred Stock shall not be mandatory or cumulative, and no rights or interest shall accrue to the holders of the Series A Convertible Preferred Stock by reason of the fact that the Company shall fail to declare or pay dividends on the Series A Convertible Preferred Stock, except for such rights or interest that may arise as a result of the Company paying a dividend or making a distribution on the common stock in violation of the terms. The holders of each share of Series A Convertible Preferred Stock then outstanding shall be entitled to be paid, out of the Available Funds and Assets, and prior and in preference to any payment or Distribution (or any setting part of any payment or Distribution) of any Available Funds and Assets on any shares of common stock, and equal in preference to any payment or Distribution (or any setting part of any payment or Distribution) of any Available Funds and Assets on any shares of any other series of preferred stock that have liquidation preference, an amount per share equal to the Original Issue Price of the Series A Convertible Preferred Stock plus all declared but unpaid dividends on the Series A Convertible Preferred Stock. A reorganization, or any other consolidation or merger of the Company with or into any other corporation, or any other sale of all or substantially all of the assets of the Company, shall not be deemed a liquidation, dissolution, or winding up of the Company. Shares of the Series A Convertible Preferred Stock are convertible at a 35% discount rate to the average closing price per share of the Company’s common stock (either as listed on a national exchange or as quoted over-the-market) for the last 15 trading days immediately prior to conversion. However, no conversions of the Series A Convertible Preferred Stock to shares of common stock can occur unless the average closing price per share of the Corporation’s common stock (either as listed on a national exchange or as quoted over-the-market) for the last 15 trading days immediately prior to conversion is at least $1.67. The shares of Series A Convertible Preferred Stock vote on a one for one basis. The right of conversion is limited by the fact the holder of the Series A Convertible Preferred Stock may not convert if such conversion would cause the holder to beneficially own more than 4.9% of the Company’s common stock after giving effect to such conversion.

On August 8, 2019, the Company entered into an 8% Series A-1 Convertible Preferred Stock Investment Agreement (the “Investment Agreement”) with First Capital Ventures, LLC (“FCV”), and its assignee. The Company desires to raise between $1,000,000 and $2,000,000 from the sale of its 8% Series A-1 Convertible Preferred Stock and FCV intends to raise between $1,000,000 and $2,000,000 (net after offering expenses) in a special purchase vehicle (“SPV”) created by FCV to purchase the 8% Series A-1 Convertible Preferred Stock. The Company granted FCV and its assigns, the exclusive right to purchase the 8% Series A-1 Convertible Preferred Stock. The Company also agreed to cancel all shares of its previously issued and outstanding Series A Convertible Preferred Stock immediately following the closing date. The Company further agreed to issue FCV a three-year stock warrant to purchase 144,317 shares of its common stock at an exercise price of $ 1.039375 per share immediately following the closing date, which was valued at $122,889 and expensed upon grant for services provided. The Company agreed to enter into a “business development” agreement with FCV, or its assignee, on the sale of the first $1,000,000 of 8% Series A-1 Convertible Preferred Stock and also granted FCV and its assigns, the right to use the name “SOBR SAFE” and any related intellectual property in connection with the SPV, and the offering of the Interests in the SPV.

In accordance with the August 8, 2019 Investment Agreement with FCV, on December 9, 2019, the Company’s Board of Directors created a class of preferred stock designated as 8% Series A-1 Convertible Preferred Stock comprising of 2,000,000 shares. The rights and preferences of the 8% Series A-1 Convertible Preferred Stock are as follows: (a) dividend rights of 8% per annum based on the original issuance price of $1 per share, (b) liquidation preference over the Company’s common stock, (c) conversion rights into shares of the Company’s common stock at $1 per share (not to be affected by any reverse stock split in connection with the Asset Purchase Agreement with IDTEC), (d) redemption rights such that we have the right, upon 30 days written notice, at any time after one year from the date of issuance, to redeem all or part of the Series A-1 Convertible Preferred Stock for 150% of the original issuance price, (e) no call rights by the Company, and (f) each share of Series A-1 Convertible Preferred Stock will vote on an “as converted” basis.

On December 12, 2019, the Company entered into a Series A-1 Preferred Stock Purchase Agreement (the “SPA”) with SOBR SAFE, LLC (“SOBR SAFE”), a Delaware limited liability company and an entity controlled by Gary Graham, one of our Directors, under which SOBR SAFE agreed to acquire 1,000,000 shares of our Series A-1 Convertible Preferred Stock (the “Preferred Shares”), in exchange for $1,000,000 (the “Purchase Price”). The Company received the Purchase Price on December 12, 2019. In connection with the closing of the SPA, holders of the Company’s common stock representing approximately 52% of the Company’s then-outstanding common stock and voting rights signed irrevocable proxies to Gary Graham and/or Paul Spieker for the purpose of allowing Mr. Graham and/or Mr. Spieker to vote those shares on any matters necessary to close the transaction that is the subject of the certain Asset Purchase Agreement with IDTEC dated May 6, 2019, as amended.

As of June 30, 2020 and December 31, 2019, the Company has sold 1,770,000 and 1,000,000 shares of its 8% Series A-1 Convertible Preferred Stock, respectively, but has not issued any stock certificates yet.

The Series A-1 Convertible Preferred Stock earns cumulative dividends at a rate of 8% per annum, payable in cash or common stock at the option of the Company on June 30 and December 31 of each year. If paid in common stock, the common stock will be valued at the average of the closing price for the five business days prior to the dividend payment date. The preferred shareholders will participate in any common stock dividends on an as converted basis. During the six month period ended June 30, 2020 and 2019, no dividends have been declared for holders of the 8% Series A-1 Convertible Preferred Stock.

The Company accounts for employee stock options and non-employee stock warrants under ASC 718 and ASC 505, 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, utilizing the Black Sholes pricing model. Unless otherwise provided for, the Company covers option exercises by issuing new shares.

Beginning on December 12, 2012, Michael A. Lanphere, a related party and non-employee, loaned the Company money for a variety of purposes, some for working capital and some to allow the Company to pay outstanding obligations. Each of these loans was made pursuant to the terms of a Loan Agreement with Promissory Note and Stock Fee (the “Agreements”). Under the terms of the Agreements, Mr. Lanphere was not only entitled to repayment of the principal amount loaned to us, with interest, but also what was termed in the Agreements as a “Stock Fee” that the parties are interpreting as a stock warrant, which permits Mr. Lanphere to acquire shares of our common stock in exchange for an exercise price that was estimated based on the date of the loan agreement. The number of shares to be issued to Mr. Lanphere as a Stock Fee under each Agreement was an estimate and varied based on the loan amount and the price of our common stock on the day of the loan and was calculated by this formula: ~~sixty percent (60%)~~60% or ~~eighty percent (80%)~~80% of the loan amount divided by the Company’s stock price on the day of the loan, but at a price per share no higher than ~~two and one-half cents ($0.025).~~$0.025. Each Stock Fee is fully vested immediately and expires ~~five (5)~~5 years from the date of the loan. Although the Stock Fee could be taken by Mr. Lanphere as a stock grant or a stock warrant, due to the fully vested nature of the Stock Fee, Mr. Lanphere is deemed to beneficially own those shares on the date of each Agreement. After the Company entered into a Debt Conversion and Common Stock Purchase Plan with Mr. Lanphere dated January 3, 2020, Mr. Lanphere agreed to exercise his stock warrants and the Company agreed to convert and issue 454,097 shares of its common stock to reduce a notes payable principal balance consisting of two notes in the amount of $65,875. The Company did not record a loss on debt extinguishment for this conversion pursuant to ASC 470-20-40-4 that states that upon conversion in accordance with its original terms, the carrying amount of the convertible debt without a BCF, including any unamortized premium or discount, is credited to the capital accounts and no gain or loss should be recognized. Mr. Lanphere owns no more warrants to shares of our common stock. The number of warrants outstanding to Mr. Lanphere at June 30, ~~2019~~2020 and December 31, ~~2018~~2019 were ~~27,400,745~~none and ~~10,818,583,~~454,097, respectively.

On August 8, 2019, the Company entered into an 8% Series A-1 Convertible Preferred Stock Investment agreement with First Capital Ventures, LLC (“FCV”). FCV set up a special purpose vehicle (“SPV”) that purchased 1,000,000 of the 8% Series A-1 Convertible Preferred Shares at $1.00 per share on December 12, 2019. Upon purchase, the Company issued the SPV through FCV a three-year warrant to purchase 144,317 shares of the Company’s common stock at an exercise price of $1.039375 per share. The number of warrants outstanding to the SPV through FCV at June 30, 2020 and December 31, 2019 are 144,317 and 144,317, respectively.

On June 5, 2020, at closing of the Transaction, the Company entered into a Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement under which we issued warrants to IDTEC to purchase up to 320,000 shares of our common stock (post-split) at an exercise price of $0.50 per share. The warrants expire five years after the date of issuance.

The total outstanding balance of all non-employee stock warrants in ~~TransBiotec, Inc.~~the Company is ~~40,535,165~~464,317 and ~~24,003,003~~598,414 at June 30, ~~2019~~2020 and December 31 ~~2018,~~2019, respectively. There were ~~16,582,162~~320,000 non-employee detached free-standing stock warrants granted during the six month period ended June 30, ~~2019~~2020 and ~~7,882,392~~498,562 non-employee detached free-standing stock warrants granted during the six month period ended June 30, ~~2018.~~2019. The relative fair value of these non-employee stock warrants granted during the six month period ended June 30, 2020 and 2019 totaled $695,454 and ~~2018 totaled~~ $35,030, ~~and $29,701,~~ respectively, and were determined using the Black-Sholes option pricing model based on the following assumptions:

	June 30, 2019			June 30, 2018			June 30, 2020			June 30, 2019
Exercise Price	$	0.00188664652 - $0.0062		$	0.0042 - $0.0043		$	0.50		$ 0.06 - 0.2
Dividend Yield		0	%		0	%		0	%		0	%
Volatility		135% - 138	%		141% - 144	%		153	%	135% - 138		%
Risk-free Interest Rate		2.31% – 2.53	%		2.65% – 2.68	%		0.29	%	2.31% – 2.53		%
Expected Life of Options		5 Years			5 Years
Life of Warrants							5 Years			5 Years

The following table summarizes the changes in the Company’s outstanding warrants during the six ~~months~~month period ended June 30, ~~2019~~2020 and ~~2018~~2019, and as of June 30, ~~2019~~2020 and ~~December 31, 2018:~~2019:

	Warrants Outstanding Number of Shares		Exercise Price Per Share		Weighted Average Remaining Contractual Life	Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value		Warrants Outstanding Number of Shares		Exercise Price Per Share		Weighted Average Remaining Contractual Life	Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value
Balance at December 31, 2017		16,120,611	$	0.0042 - 0.0190	4.06 Years	$	0.0066	$	-
Balance at December 31, 2018											721,678	$	0.1397 - 0.6319	3.45 Years	$	0.1929	$	-
Warrants Granted		7,882,392	$	0.0042 - 0.0043	4.75 Years	$	0.0042	$	45,644		498,562	$	0.06 - 0.2062	4.72 Years	$	0.1064	$	22,428
Warrants Exercised		-		-							-		-
Warrants Expired		-		-							1,503	$	0.6319		$	0.6319
Balance at June 30, 2018		24,003,003	$	0.0042 - 0.0190	3.95 Years	$	0.0058	$	100,246

Balance at June 30, 2019											1,218,737	$	0.06 - 0.6319	3.68 Years	$	0.1596	$	-

~~On April 30, 2018, a related party exercised 450,000 stock options at an exercise price of $0.01 per share.~~

As of June 30, 2019 and December 31, 2018, there were two outstanding stock options to officers, directors, and consultants to purchase 275,000 shares of TransBiotec, Inc. common stock. The first outstanding stock option is dated October 1, 2014 and has an option price on that day of $0.0062, with an option exercise price of $0.25. The second outstanding option is dated October 27, 2014 at an option price on that day of $0.0066 with an option exercise price of $0.007. These stock options vested upon grant. There were no stock options granted during the six months ended June 30, 2019 and 2018.

On October 24, 2019, the Company’s 2019 Equity Incentive Plan went effective. The plan was approved by the Company’s Board of Directors and the holders of a majority of the Company’s voting stock on September 9, 2019. The plan’s number of authorized shares is 3,848,467. As of June 30, 2020 and December 31, 2019, the Company granted stock options to acquire 2,521,239 and 2,381,239 shares of common stock under the plan, respectively. As of June 30, 2020, the plan has 1,040,355 vested shares and 1,480,884 non-vested shares. As of December 31, 2019, the plan had 539,847 vested shares and 1,841,392 non-vested shares. The stock options are held by our officers, directors, and certain key consultants. In total for the six months ended June 30, 2020 and 2019, the Company recorded $296,932 and none, respectively, of share-based compensation expense related to the stock options. The unrecognized compensation expense as of June 30, 2020 was approximately $348,000 for non-vested share-based awards to be recognized over periods of approximately three to seven years. The fair value of the stock options granted during the six month period ended June 30, 2020 was determined using the Black-Sholes option pricing model based on the following assumptions: exercise price $2, dividend yield 0%, volatility 153%, risk-free interest rate 0.29%, life of options 5 years.

The following table summarizes the changes in the Company’s outstanding stock options during the six month period ended June 30, ~~2019~~2020 and ~~2018,~~2019, and as of June 30, ~~2019~~2020 and ~~December 31, 2018:~~2019.

	Options Outstanding Number of Shares		Exercise Price Per Share		Weighted Average Remaining Contractual Life	Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value
Balance at December 31, 2017		2,225,000	$	0.0045 - 0.25	3.00 Years	$	0.0204	$	-
Options Granted		-		-
Options Exercised		450,000	$	0.01
Options Cancelled		-		-
Options Expired		-		-
Balance at June 30, 2018		1,775,000	$	0.0045 - 0.25	3.00 Years	$	0.0083	$	3,000



					Weighted	Weighted
	Options				Average	Average
	Outstanding		Exercise		Remaining	Exercise		Aggregate
	Number of		PricePer		Contractual	PricePer		Intrinsic
	Shares		Share		Life	Share		Value
										Options Outstanding Number of Shares		Exercise Price Per Share		Weighted Average Remaining Contractual Life	Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value
Balance at December 31, 2018		1,775,000	$	0.0045 - 0.25	2.32 Years	$	0.0083	$	-		53,367	$	0.1497 – 8.31	2.32 Years	$	0.2761	$	-
Options Granted		-		-							-		-
Options Exercised		-		-							-		-
Options Cancelled		1,500,000	$	0.0045		$	0.0045				45,100	$	0.1497		$	0.1497
Options Expired		-		-							-		-
Balance at June 30, 2019		275,000	$	0.007 - 0.25	0.32 Years	$	0.0291	$	-

Exercisable at December 31, 2018		1,775,000	$	0.0045 - 0.25	2.32 Years	$	0.0083	$	-
Exercisable at June 30, 2019		275,000	$	0.007 - 0.25	0.32 Years	$	0.0291	$	-
Balance at June 30, 2019											8,267	$	0.2328 – 8.31	0.32 Years	$	0.9678	$	-

The Company ~~had 250,000~~has 660,119 outstanding executive stock options exercisable at ~~$0.007~~$0.2634 per share as of June 30, 2020 and 299,317 outstanding executive stock options as of December 31, 2019.

On October 25, 2019, the Company granted Charles Bennington, one of the Company’s directors, options to acquire 24,053 shares of the Company’s common stock under its 2019 Equity Incentive Plan. The stock options have an exercise price of $0.2634 and vest quarterly over a one-year period commencing January 1, 2020. The stock options have a five-year term. A total of 12,027 and 0 stock options were vested as of June 30, 2020 and December 31, ~~2018.~~2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of June 30, 2020.

~~Stock Subscriptions Payable~~On October 25, 2019, the Company granted Nick Noceti, the former Company’s Chief Financial Officer, options to acquire 24,053 shares of the Company’s common stock under its 2019 Equity Incentive Plan. The stock options have an exercise price of $0.2634 and vest quarterly over a two-year period commencing January 1, 2020. The stock options have a five-year term. A total of 6,013 and 0 stock options were vested as of June 30, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of June 30, 2020.

On October 25, 2019, the Company granted Gary Graham, one of the Company’s directors, options to acquire 24,053 shares of the Company’s common stock under its 2019 Equity Incentive Plan. The stock options have an exercise price of $0.2634 and vest quarterly over a one-year period commencing January 1, 2020. The stock options have a five-year term. A total of 12,027 and 0 stock options were vested as of June 30, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of June 30, 2020.

On October 25, 2019, the Company ~~had~~entered into an Employment Agreement with Kevin Moore to serve as the Company’s Chief Executive Officer. Under the terms of the agreement, the Company granted Kevin Moore stock ~~subscriptions payable due~~options under its 2019 Equity Compensation Plan to ~~a related party of $2,058 convertible into 424,479~~acquire 1,058,328 shares of its common stock at an exercise price of $0.2634. The stock options vest in 36 equal monthly installments of 29,398 shares ~~at June 30, 2019. The Company had~~during the three-year term of his Employment Agreement. 176,388 stock subscriptions payable due to a related party of $1,271 convertible into 243,273 of its common shares at December 31, 2018. The Company recorded a related party gain of $15,522 and $15,143 related to the outstanding stock subscriptions payableoptions vested during the six month period ended June 30, 2020. A total of 235,184 and 58,796 stock options were vested as of June 30, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and ~~2018, respectively.~~no shares have been issued as of June 30, 2020 or December 31, 2019.

On October 25, 2019, the Company entered into an Employment Agreement with David Gandini to serve as the Company’s Chief Revenue Officer. Under the terms of the agreement, the Company granted David Gandini stock options under its 2019 Equity Compensation Plan to acquire 721,588 shares of its common stock at an exercise price of $0.2634. The stock options vest in 36 equal monthly installments of 20,044 shares during the three-year term of his Employment Agreement. David Gandini was also granted an aggregate of 240,529 additional option shares (the “Pre-Vesting Option Shares”) to vest as follows: (i) 200,439 Pre-Vesting Option Shares representing the monthly vesting option shares for the ten months ended October 31, 2019 to vest on November 1, 2019; and (ii) the remaining 40,090 Pre-Vesting Option Shares representing the monthly vesting option shares for the two months ended December 31, 2019 shall vest on January 1, 2020. The stock options have a ten-year term. 160,361 stock options vested during the six month period ended June 30, 2020. A total of 400,882 and 240,521 stock options were vested as of June 30, 2020 and December 31, 2019, respectively. None of the vested stock options have been exercised and no shares have been issued as of June 30, 2020 or December 31, 2019.

~~On March 31, 2018, the Company converted $8,204 of its related party payables into 91,148 issued shares of its common stock at $0.09 per share. $7,776 was recorded as a related party gain.~~

On April 18, 2018, the Company converted $25,800 of prepaid consulting, research and development costs owed to six non-related parties into 6,000,000 issued shares of our common stock at a purchase price of $0.0043 per share.

~~On April 30, 2018, the Company converted $500 of related party compensation for consulting services into 50,000 issued shares of its common stock at $0.01 per share.~~

~~On April 30, 2018, the Company converted $4,500 of stock options exercised by a related party into 450,000 issued shares of its common stock at $0.01 per share.~~

~~On April 30, 2018, the Company converted $7,500 owed to a related party for executive compensation into 750,000 shares of its common stock at $0.01 per share.~~

~~On February 25, 2019, the Company issued 35,454,547 shares of its common stock to non-related parties for $39,000 in cash.~~

On November 20, 2015, the Company’s Board of Directors authorized a class of stock designated as preferred stock with a par value of $0.00001 per share comprising 25,000,000 shares, 3,000,000 shares of which were classified as Series A Convertible Preferred stock. In each calendar year, the holders of the Series A Convertible Preferred stock are entitled to receive, when, as and if, declared by the Board of Directors, out of any funds and assets of the Company legally available, non-cumulative dividends, in an amount equal to any dividends or other Distribution on the common stock in such calendar year (other than a Common Stock Dividend). No dividends (other than a Common Stock Dividend) shall be paid and no distribution shall be made with respect to the common stock unless dividends shall have been paid or declared and set apart for payment to the holders of the Series A Convertible Preferred stock simultaneously. Dividends on the Series A Convertible Preferred stock shall not be mandatory or cumulative, and no rights or interest shall accrue to the holders of the Series A Convertible Preferred stock by reason of the fact that the Company shall fail to declare or pay dividends on the Series A Convertible Preferred stock, except for such rights or interest that may arise as a result of the Company paying a dividend or making a distribution on the common stock in violation of the terms. The holders of each share of Series A Convertible Preferred stock then outstanding shall be entitled to be paid, out of the Available Funds and Assets, and prior and in preference to any payment or Distribution (or any setting part of any payment or Distribution) of any Available Funds and Assets on any shares of common stock, and equal in preference to any payment or Distribution (or any setting part of any payment or Distribution) of any Available Funds and Assets on any shares of any other series of preferred stock that have liquidation preference, an amount per share equal to the Original Issue Price of the Series A Convertible Preferred stock plus all declared but unpaid dividends on the Series A Convertible Preferred stock. A reorganization, or any other consolidation or merger of the Company with or into any other corporation, or any other sale of all or substantially all of the assets of the Company, shall not be deemed a liquidation, dissolution, or winding up of the Company. Shares of the Series A Convertible Preferred stock are convertible at a 35% discount rate to the average closing price per share of the Company’s common stock (either as listed on a national exchange or as quoted over-the-market) for the last fifteen (15) trading days immediately prior to conversion. However, no conversions of the Series A Convertible Preferred stock to shares of common stock can occur unless the average closing price per share of the Corporation’s common stock (either as listed on a national exchange or as quoted over-the-market) for the last fifteen (15) trading days immediately prior to conversion is at least five cents ($0.05). The shares of Series A Convertible Preferred stock vote on an “as converted” basis. The right of conversion is limited by the fact the holder of the Series A Convertible Preferred stock may not convert if such conversion would cause the holder to beneficially own more than 4.9% of the Company’s common stock after giving effect to such conversion.

~~As of June 30, 2019 and December 31, 2018, the Company has 1,388,575 issued shares of its Series A Convertible Preferred stock.~~

~~During the six month ended June 30, 2019 and 2018, no dividends have been declared for holders of the Series A Convertible Preferred stock.~~

The Company leased office space under a long-term operating lease that expired in June 2019. ~~As of July 1, 2019, the~~The Company ~~leases~~leased the same office space on a month to month ~~basis.~~basis until December 31, 2019. On October 15, 2019, the Company entered into a short-term lease agreement with Highland School that is between $2,800 - $2,900 per month and ends on October 31, 2020. The Company also leases an office space for $1,300 per month on a short-term (month to month) basis through a related party that terminates at any time. Rent expense under ~~this lease,~~office leases, including CAM charges, was ~~$26,210~~$42,348 and $26,210 for the six month period ended June 30, ~~2019~~2020 and ~~June 30, 2018,~~2019, respectively.

On December 6, 2006, Orange County Valet and Security Patrol, Inc. filed a lawsuit against us in Orange County California State Superior Court for Breach of Contract in the amount of $11,164. A default judgment was taken against us in this matter. In mid-2013 we learned the Plaintiff’s perfected the judgment against us, but we have not heard from the Plaintiffs as of ~~January~~August 2020.

We currently have one outstanding judgment against us involving a past employee of the Company. The matter is under the purview of the State of California, Franchise Tax Board, Industrial Health and Safety Collections. We currently owe approximately $28,786, plus accrued interest, to our ex-employee for unpaid wages under these Orders and we are working to get this amount paid off.

OnBetween July ~~18, 2019,~~1, 2020 and August 3, 2020, the Company borrowed $41,375 from a related party. The note payable carries an interest rate of 7%, matures on July 17, 2020, and contains a conversion feature that allows the Company to convert all principal and interest due under note into 9,103,261sold 953,000 shares of the Company’s ~~common stock.~~

~~On August 8, 2019, the Company entered into an~~ 8% Series A-1 Convertible Preferred Stock to SOBR Safe, LLC, pursuant to the Investment Agreement ~~with~~by and between the Company and SOBR Safe, LLC (as designee of First Capital Ventures, ~~LLC (“FCV”),~~LLC) dated August 8, 2019, as amended, and its assignee. The Company desires to raise between $1,000,000 and $2,000,000 from the sale of its 8% Series A-1 Convertible Preferred Stock and FCV intends to raise between $1,000,000 and $2,000,000 (net after offering expenses) in a special purchase vehicle (“SPV”) created by FCV to purchase the 8% Series A-1 Convertible Preferred Stock. The Company granted FCV and its assigns, the exclusive right to purchase the 8% Series A-1 Convertible Preferred Stock. The Company agreed to pay certain legal and other expenses of the SPV subsequent to the day in which the Company receives a minimum of $1,000,000 from the sale of 1,000,000 shares of the 8% Series A-1 Convertible Preferred Stock. The Company also agreed to cancel all shares of its issued and outstanding Series A Preferred Stock, immediately following the closing date and to pay $15,000 to the SPV for its legal costs and expenses and to pay or reimburse for any other costs or expenses related to the offering and sale of the interests in the SPV, including but not limited to, any sales commissions or other offering and organization expenses. The Company further agreed to issue FCV a three-year stock warrant to purchase 150,000 (post-split) shares of its Common Stock at an exercise price of $1.00 per share immediately following the closing date. The Company agreed to enter into a “business development” agreement with FCV, or its assignee, on the sale of the first $1,000,000 of 8% Series A-1 Convertible Preferred Stock and also granted FCV and its assigns, the right to use the name “SOBR SAFE” and any related intellectual property in connection with the SPV, and the offering of the Interests in the SPV.

On August 23, 2019, the Company entered into a Common Stock Purchase Agreement (the “Bennington” SPA) with Charles Bennington, one of the Company’s officers and directors, under which the Company agreed to issue 14,000,000 shares of its common stock in exchange for Mr. Bennington forgiving $595,000 in accrued compensation due. The common shares were issued on or about August 28, 2019 at a per-share purchase price of $0.0425 per share.

On August 23, 2019, the Company entered into a Share Exchange Agreement (the “Lanphere” SEA) with Michael Lanphere, one of the Company’s officers, under which the Company agreed to issue 5,206,430 shares of its common stock in exchange for 520,643 shares of the Company’s Series A Preferred Stock owned by Mr. Lanphere. The Series A Preferred stock were exchanged for the Company’s common shares at a price of $0.10 per share and were issued on or about August 28, 2019.

On August 23, 2019, the Company entered into a Share Exchange Agreement (the “Justus” SEA) with Vernon Justus, an individual, under which the Company agreed to issue 8,679,320 shares of its common stock in exchange for 867,932 shares of the Company’s Series A Preferred Stock owned by Mr. Justus. The Series A Preferred stock were exchanged for the Company’s common shares at a price of $0.10 per share and were issued on or about August 28, 2019.

On August 23, 2019, the Company entered into a Debt Conversion and Common Stock Purchase Plan (the “Lanphere” SPA) with Michael Lanphere, one of the Company’s officers, under which the Company agreed to issue 21,400,745 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Lanphere under numerous promissory notes. Mr. Lanphere’s option to acquire the shares was under the terms of certain Loan Agreement with Promissory Note and Stock Fees agreements entered into with the Company and Mr. Lanphere. The amount of the debt reduction and, therefore the purchase price of the shares was $96,303.35. The common shares were issued on or about August 28, 2019 at an effective conversion price of $0.0045 per share.

On August 23, 2019, the Company entered into a Debt Conversion and Common Stock Purchase Plan (the “Mishal” SPA) with Devadatt Mishal, one of the Company’s directors, under which the Company agreed to issue 13,134,420 shares of its common stock in exchange for a reduction in the amounts owed to Mr. Mishal under numerous promissory notes. Mr. Mishal’s option to acquire the shares was under the terms of certain Loan Agreement with Promissory Note and Stock Fees agreements entered into with the Company and Mr. Mishal. The amount of the debt reduction and, therefore the purchase price of the shares was $58,478.01. The common shares were issued on or about August 28, 2019 at an effective conversion price of $0.0043 per share. After the acquisition of the 13,134,420 shares under the Mishal SPA, the reporting person owned 20,534,857 shares of the Company’s common stock equal to approximately 9.5% of the Company’s outstanding common stock.

On September 9, 2019, the Company’s Board of Directors approved the TransBiotec, Inc. 2019 Equity Incentive Plan, and authorized an aggregate of 128,000,000 shares of the Company’s common stock, subject to stock splits, recapitalizations, and other adjustments, for issuance to all employees of the Company, or any Subsidiary of the Company, to any non-employee director, consultants, and to independent contractors of the Company, or any Subsidiary and any joint venture partners of the Company or any Subsidiary. The Plan will be administered by the Compensation Committee of the Board of Directors (or the entire Board of Directors if the Company does not have a Compensation Committee). Under the Plan, the Committee may award Eligible Recipients with shares of its Common Stock in the form of Incentive Awards, Restricted Stock Awards, SARs, RSUs, Performance Awards, and Other Awards as defined in the Plan. The Common Stock under the Plan will come from authorized but unissued shares of the Company’s Common Stock. The Plan is intended to advance the interest of the Company and its stockholders by enabling the Company and its Subsidiaries to attract and retain persons of ability to perform services for the Company and its Subsidiaries by providing an incentive to such individuals through equity participation in the Company and by rewarding those individuals who contribute to the achievement of the Company’s operational and financial objectives. This Plan went effective on October 24, 2019 and allows our Board of Directors to issue stock grants, stock options and other equity incentive awards to our officers, directors, employees and consultants.

On October 17, 2019 and October 28, 2019, Daljit Khangura and Devadatt Mishal, respectively, submitted their resignations from the Company’s Board of Directors. According to their resignation letters, there are no disagreements with either Mr. Khangura or Dr. Mishal.

On October 25, 2019, Charles Bennington submitted his resignation as the Company’s Chief Executive Officer, effective with the appointment of his replacement. Mr. Bennington is continuing on as the Company’s President (our principal executive officer), our Secretary, and as a member of our Board of Directors. According to Mr. Bennington’s resignation letter, there are no disagreements with Mr. Bennington.

On October 25, 2019, the Company entered into an Employment Agreement with Mr. Kevin Moore to serve as the Company’s Chief Executive Officer (the “Moore Agreement”). Under the terms of the Moore Agreement, Mr. Moore will serve as our Chief Executive Officer until October 24, 2022, unless either (i) the transaction that is the subject of that certain Asset Purchase Agreement with IDTEC, LLC, a Colorado limited liability company (the “IDTEC Transaction”), has not closed by January 31, 2020, in which case Mr. Moore’s employment will terminate immediately, or (ii) he is terminated pursuant to the other termination provisions set forth in the Moore Agreement. Under the terms of the Moore Agreement, Mr. Moore will perform services for the Company that are customary and usual for a chief executive officer of a company, in exchange for: (i) 800,000 shares of our common stock per month until the IDTEC Transaction closes, (ii) thereafter, an annual base salary of $213,000, (iii) sales bonuses based on the Company’s sales, and (iv) incentive stock options under our 2019 Equity Compensation Plan to acquire 35,200,000 shares of our common stock, at an exercise price of $0.00792, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with the stock options to vest in 36 equal monthly installments of 977,777 shares during the three-year term of the Moore Agreement. The stock options have a ten year term. The Company will be issuing Mr. Moore a stock option agreement for the options he was issued under the Moore Agreement. No shares were issued to Mr. Moore.

On October 25, 2019, the Company entered into an Employment Agreement with Mr. David Gandini to serve as our Chief Revenue Officer (the “Gandini Agreement”). Under the terms of the Gandini Agreement, Mr. Gandini will serve as the Company’s Chief Revenue Officer until October 24, 2022, unless either (i) the transaction that is the subject of that certain Asset Purchase Agreement with IDTEC, LLC, a Colorado limited liability company (the “IDTEC Transaction”), has not closed by January 31, 2020, in which case Mr. Gandini’s employment will terminate immediately, or (ii) he is terminated pursuant to the other termination provisions set forth in the Gandini Agreement. Under the terms of the Gandini Agreement, Mr. Gandini will perform services for us that are customary and usual for a chief revenue officer of a company, in exchange for: (i) an annual base salary of $185,000, (ii) sales bonuses based on the Company’s sales, (iii) incentive stock options under our 2019 Equity Compensation Plan to acquire 24,000,000 shares of our common stock, at an exercise price of $0.00792, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with the stock options to vest in 36 equal monthly installments of 666,666 shares during the three-year term of the Gandini Agreement, and (iv) an aggregate of 8,000,000 additional option shares (the “Pre-Vesting Option Shares”) to vest as follows: (i) 6,666,600 Pre-Vesting Option Shares representing the monthly vesting option shares for the ten months ended October 31, 2019 to vest on November 1, 2019; and (ii) the remaining 1,333,400 Pre-Vesting Option Shares representing the monthly vesting option shares for the two months ended December 31, 2019 shall vest on January 1, 2020. The stock options have a ten year term. The Company will be issuing Mr. Gandini a stock option agreement for the options he was issued under the Gandini Agreement. No shares were issued to Mr. Gandini.

On October 25, 2019, the Company granted Charles Bennington, one of the Company’s officers and directors, an option to acquire 800,000 shares of our common stock under the Company’s 2019 Equity Incentive Plan. The stock option has an exercise price of $0.00792, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with option vesting quarterly over a one year period commencing January 1, 2020. The stock option has a five year term. The issuance of the stock option was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact Mr. Bennington is one of our officers and directors, is a sophisticated investor and familiar with our operations. No shares were issued to Mr. Bennington.

On October 25, 2019, the Company granted Nick Noceti, the Company’s Chief Financial Officer, an option to acquire 800,000 shares of our common stock under our 2019 Equity Incentive Plan. The stock option has an exercise price of $0.00792, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with option vesting quarterly over a two year period commencing January 1, 2020. The stock option has a five year term. The issuance of the stock option was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact Mr. Noceti is the Company’s Chief Financial Officer, is a sophisticated investor and familiar with our operations. No shares were issued to Mr. Noceti.

On October 25, 2019, the Company granted Gary Graham, one of the Company’s directors, an option to acquire 800,000 shares of our common stock under our 2019 Equity Incentive Plan. The stock option has an exercise price of $0.00792, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with option vesting quarterly over a one year period commencing January 1, 2020. The stock option has a five year term. The issuance of the stock option was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact Mr. Graham had been consulting with the Company for more than one year at the time of grant, is a sophisticated investor and familiar with our operations. No shares were issued to Mr. Graham.

On October 25, 2019, the Company issued stock options to acquire an aggregate of 6,400,000 shares of our common stock to four non-affiliated individuals and entities that have been working with the Company for over the last year. The stock options were issued under our 2019 Equity Incentive Plan at an exercise price of $0.00792, which is equal to 110% of the fair market value of our common stock on October 25, 2019, with the options vesting quarterly over a two year period commencing January 1, 2020. The stock options have either a two year or five year term. The issuance of the stock option was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact the individuals and entities have been consulting with the Company for months, are sophisticated investors and familiar with our operations.

On November 7, 2019, the Company’s Board of Directors appointed Gary Graham to its Board of Directors. Mr. Graham will serve in this capacity until the next meeting of stockholders or until his successor has been duly elected and qualified, or until the earlier of his death, resignation or removal.

On November 22, 2019, the Company’s Board of Directors approved the appointment of Kevin Moore and David Gandini, Chief Executive Officer and Chief Revenue Officer, respectively, to the Company’s Board of Directors, effective December 2, 2019. They will serve in this capacity until the next meeting of stockholders or until their successor has been duly elected and qualified, or until the earlier of their death, resignation or removal.

~~On December 12, 2019, the Company entered into a~~corresponding Series A-1 Preferred Stock Purchase Agreement (the “SPA”) with SOBR SAFE, LLC, a Delaware limited liability company and an entity controlled by Gary Graham, one of the Company’s Directors (“SOBR SAFE”), under which (i) the Company agreed to create a new series of convertible preferred stock entitled “Series A-1 Convertible Preferred Stock,” with Two Million (2,000,000)Agreement. The shares ~~authorized and the following rights: (a) dividend rights of 8% per annum based on the original issuance price of~~were sold for $1 per share ~~(b) liquidation preference over the Company’s common stock, (c) conversion rights into shares~~for a total purchase price of our common stock at $1 per share, (d) redemption rights such that the Company has the right, upon thirty (30) days written notice, at any time after one year from the date of issuance, to redeem the all or part of the Series A-1 Preferred Stock for 150% of the original issuance price, (e) no call rights by the Company, and (f) each share of Series A Convertible Preferred stock will vote on an “as converted” basis; and (ii) SOBR SAFE agreed to acquire One Million (1,000,000) shares of the Company’s Series A-1 Convertible Preferred Stock (the “Preferred Shares”), once created, in exchange for One Million Dollars ($1,000,000) (the “Purchase Price”). The Company received the Purchase Price on December 12, 2019 and will issue the Preferred Shares as soon as the Company receives confirmation from the State of Delaware that the Series A-1 Preferred Stock has been created. In connection with the closing of the SPA, holders of our common stock representing approximately 52% of the Company’s outstanding common stock and voting rights signed irrevocable proxies to Gary Graham and/or Paul Spieker for the purpose of allowing Mr. Graham and/or Mr. Spieker to vote those shares on any matters necessary to close the transaction that is the subject of the certain Asset Purchase Agreement May 6, 2019, as amended. The issuance of the Preferred Shares was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact the principal of the manager of SOBR SAFE is one of our directors, and SOBR SAFE is an accredited investor and familiar with our operations.$953,000.

On January 3, 2020, the Company issued 2,102,854 shares of its common stock to Michael Lanphere, a related party (“Lanphere”), in exchange for his agreement to convert $210,285.44 in debt owed to him under numerous promissory notes. The shares were issued at a value of $0.10 per share pursuant to the terms of a Common Stock Purchase Agreement. The conversion was in full satisfaction of all amounts due to Lanphere under the notes.

On January 3, 2020, the Company issued 6,000,000 shares of its common stock to Lanphere in exchange for his agreement to convert $24,000 in debt owed to him under a promissory note dated April 17, 2019. The shares were issued at a value of $0.004 per share pursuant to the terms of the convertible note, and were issued pursuant to the terms of a Common Stock Purchase Agreement. The conversion was in full satisfaction of all amounts due to Lanphere under the note.

On January 3, 2020, the Company issued 9,103,261 shares of its common stock to Lanphere in exchange for his agreement to convert $41,875 in debt owed to him under a promissory note dated July 17, 2019. The shares were issued at a value of $0.0046 per share pursuant to the terms of the convertible note, and were issued pursuant to the terms of a Common Stock Purchase Agreement. The conversion was in full satisfaction of all amounts due to Lanphere under the note.

On January 3, 2020, the Company issued an aggregate of 4,605,847 shares of its common stock to five non-affiliate investors in exchange for their agreement to convert $460,585 in debt owed to them under numerous promissory notes. The shares were issued at a value of $0.10 per share and pursuant to the terms of Common Stock Purchase Agreements. The conversion was in full satisfaction of all amounts due under the notes.

On January 16, 2020, the Company issued 1,274,636 shares of its common stock to with two non-related parties in exchange for their agreement to settle an accounts payable of $127,463.59 owed to them. The shares were issued at a value of $0.10 per share and were issued pursuant to the terms of Common Stock Purchase Agreements. The conversion was in full satisfaction of all amounts due to them.

On January 16, 2020, the Company issued 874,636 shares of its common stock to Lanphere in exchange for his agreement to convert $87,463.59 in accounts payable owed to him. The shares were issued at a value of $0.10 per share and were issued pursuant to the terms of a Common Stock Purchase Agreement. The conversion was in full satisfaction of all amounts due to Lanphere for the accounts payable.

On January 22, 2020, the Company issued 238,143 shares of its common stock to a non-related party in exchange for their agreement to settle an accounts payable of $23,814.30 owed to them. The shares were issued at a value of $0.10 per share and were issued pursuant to the terms of a Common Stock Purchase Agreement. The conversion was in full satisfaction of the all amounts owed to them.

Our Management’s Discussion and Analysis or Plan of Operations contains not only statements that are historical facts, but also statements that are forward-looking. Forward-looking statements are, by their very nature, uncertain and risky. These risks and uncertainties include international, national and local general economic and market conditions; demographic changes; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; raw material costs and availability; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other risks that might be detailed from time to time in our filings with the Securities and Exchange Commission (“SEC”).

Although the forward-looking statements in this Quarterly Report reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by them. Consequently, and because forward-looking statements are inherently subject to risks and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. You are urged to carefully review and consider the various disclosures made by us in this report and in our other reports as we attempt to advise interested parties of the risks and factors that may affect our business, financial condition, and results of operations and prospects.

We have developed anand patented a touch-based identity verification and alcohol detection ~~device~~system called ~~“SOBR”, for which we are still performing beta testing. The device~~SOBR™Check. SOBR™Check is a ~~patented system for use~~potentially disruptive technology with anticipated applications in ~~detecting alcohol~~1) commercial fleet management, 2) school buses, 3) manufacturing facilities and 4) warehousing. We have begun our initial pilot testing, which will continue through the end of 2020 with the goal to finalize the commercial product design and manufacturing strategy by that time. We anticipate beginning commercialization in ~~a person’s system by measuring~~ the ethanol content in their perspiration. Once SOBR is developed and tested, we plan to market the device to four primary business segments: (i) as an aftermarket-installed device to companies and institutions that employ or contract with vehicle drivers, such as trucking companies, limousine companies, and taxi cab companies, where the systemfirst quarter of 2021. SOBR™Check will be ~~marketed as a preventative drunk driving detection system, with a possible ignition locking device, (ii)~~manufactured in the original equipment manufacturing (OEM) market, where the device would be installed in new vehicles during the original building of a vehicle, (iii) companies and institutions that have an interest in monitoring their employees’ or contractors’ alcohol level due to their job responsibilities, such as surgeons prior to entering surgery, pilots prior to flying aircraft, mineworkers prior to entering a mine, or the military for personnel returning to a military base from off-base leave or prior to leaving for a mission, and (iv) companies that would want to provide knowledge to their customers of their current alcohol level, such as lounge and bar owners, or customers attending a golfing event. We believe SOBR offers a unique solution to the national alcohol abuse problem.United States.

We have developed a marketing plan that ~~our management believes will gain market recognition for the SOBR device, primarily through~~includes 1) multi-channel investor relations, 2) popular and trade ~~shows, industry publications, general solicitation,~~media public relations, 3) advocacy group alignment, 4) video-centric social media outreach, 5) deploying savvy business development partners specific to and ~~public relations, as well as hopefully generating~~expert in the ~~demand~~market segments/applications defined above 6) and continual research around the potential integration of detection technology for ~~the SOBR device through the use of selling groups, such as channel sales, distributors,~~THC and independent sales contractors. We believe the primary market for the in-vehicle SOBR device initially is the commercial vehicle market, such as trucking companies, taxi cab companies, limousine companies, and bus companies. Many of these companies haveopiates, to name a significant financial interest in eliminating drunk drivers from their operations. Secondarily, individuals may desire to monitor a family member’s vehicle, such as an automobile operated by a minor or a family member with a past alcohol issue.few.

In addition to focusing on the development, marketing, and commercialization of the SOBR™Check device, we are also constantly reviewing potential synergistic technologies and businesses for potential partnerships or as acquisition candidates.

We believe the primarily market for the portable SOBR device is its use by companies and institutions that have an interest in monitoring their employees’ or contractors’ alcohol level due to their job responsibilities, such as surgeons prior to entering surgery, pilots prior to flying aircraft, mineworkers prior to entering a mine, or the military for personnel returning to a military base from off-base leave.

On June 5, 2020, we closed the transaction (the “Transaction”) that was the subject of that certain Asset Purchase Agreement dated May 6, 2019 ~~we signed a definitive Asset Purchase Agreement (the~~(and Amendment No. 1 dated March 9, 2020, together the “APA”) with IDTEC, LLC (“IDTEC”), under which IDTEC agreed to ~~acquire~~provide personnel, experience, and access to funding to assist with the development of our SOBR device, as well as to sell to us certain ~~assets related to~~ robotics ~~equipment,~~assets, which our management believes isare synergistic with our current assets, ~~from IDTEC~~ in exchange for 12,000,000 shares of our common stock ~~equal~~after giving effect to ~~60%~~the reverse stock split effected in connection with closing the transaction. The closing of ~~our then outstanding common stock. The APA is~~the Transaction was subject to several conditions precedent, primarily: (i) we ~~must~~had to be current in our reporting requirements under the Securities Exchange Act of 1934, as amended, (ii) we ~~must~~had to complete a reverse stock split of our common stock such that approximately 8,000,000 shares ~~will be~~were outstanding immediately prior to closing the transaction, ~~with no~~(iii) we could only have outstanding convertible instruments ~~other than~~ as set forth in the APA, ~~and~~(iv) our authorized common stock ~~must~~had to be reduced to 100,000,000 shares, and ~~(iii)~~(v) we ~~must~~could not have more than approximately ~~$150,000~~$125,000 in current liabilities. ~~We do not believe we will close this transaction until early 2020. At the time of~~Effective with the closing of the transaction all of the closing conditions had been met, modified or waived by IDTEC, and we ~~estimate we will have approximately 257,000,000~~issued the 12,000,000 shares to IDTEC in exchange for IDTEC providing access to personnel, experience, funding to assist with the development of our ~~common stock outstanding before factoring in any reverse stock split.~~

~~In advance of closing the transaction, IDTEC and a few other affiliated parties have been advancing funds to us and/or on our behalf for the costs related to the transaction,~~SOBR device, as well as ~~for further developing and enhancing our current SOBR product. The funds advanced will be turned into promissory notes at~~ the ~~closing of the APA and are expected to be around $1 million by the time we close the transaction.~~

robotics assets. The description of the APA set forth in this ~~Quarterly Report~~report is qualified in its entirety by reference to the full text of that document and the amendment, which are attached hereto as Exhibits 10.1 and 10.12, respectively.

In advance of closing the Transaction, IDTEC and a few other affiliated parties (i) loaned funds directly to us, (ii) spent funds for the general costs related to the Transaction, and/or (iii) spent funds to further develop and enhance the current SOBR product. As a result of closing the Transaction, all the funds spent by IDTEC for any reason related to the Transaction were turned into a convertible promissory note. This note totaled approximately $1,485,000 at closing, carries a simple interest rate of 10% per annum, is due upon demand, and may be convertible into shares of our common stock at $0.50 per share (after giving effect to the reverse stock split and subject to anti-dilution protection against any future securities we may issue at an effective price of less than $0.50 per share) at the discretion of the holder. The repayment of this promissory note is secured by a first priority security lien or security interest in our patents, trademarks, tradenames and other intellectual property described in Exhibit A of the promissory note. The convertible promissory note we issued is in the form attached hereto as Exhibit ~~10.6 to this Current Report on Form 8-K and is incorporated herein by reference.~~10.13.

IfAt closing, some of the closing ~~occurs, the assets being acquired~~conditions under the APA were either waived and/or modified by the parties. In order to document those modifications and waivers, we entered into a Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement with IDTEC. One of the closing conditions that was the subject of the Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement was the requirement that the Company have under $125,000 in permitted liabilities (not including aged liabilities) after closing of the Transaction. At closing we had approximately $158,000 in non-permitted liabilities under the APA. As a result, the Company issued a Warrant to Purchase Common Stock to IDTEC (the “Warrant”), under which IDTEC will purchase up to 320,000 shares of our common stock (post-split) at an exercise price of $0.50 per share, if either (i) we are forced to pay a non-permitted liability, then we may force IDTEC to exercise the ~~same assets that were subject~~Warrant and pay the exercise price to pay the ~~Letter~~non-permitted liability, but only in an amount sufficient to pay the non-permitted liability, or (ii) if IDTEC otherwise elects to exercise the Warrant and acquire some or all of ~~Intent with First Capital Holdings, LLC we previously announced in our Current Report on Form 8-K filed on November 6, 2018.~~the shares underlying the Warrant. The Warrant expires five years after the date of issuance.

We were formed in August 2007 to publish and distribute Image Magazine, a monthly guide and entertainment source for the Denver, Colorado area. We generated only limited revenue and essentially abandoned the business plan in January 2009.

On September 19, 2011, we, Imagine Media, Ltd., a Delaware corporation, acquired approximately 52% of the outstanding shares of TransBiotec, Inc. ~~(“TBT”~~(the “Company” or “TBT”), a California corporation, from ~~TBT’s~~TBT's directors in exchange for ~~12,416,462~~373,315 shares of our common stock. The accounting for this transaction was identical to that resulting from a reverse acquisition, except that no goodwill or other intangibles were recorded, as our shareholders retained the majority of the outstanding common stock of Imagine Media, Ltd. after the share exchange. At the time, these shares represented approximately 52% of our outstanding common stock. TBT was a California corporation.

On January 17, 2012, our Board of Directors amended our Certificate of Incorporation changing our name from Imagine Media, Ltd. to TransBiotec, Inc.

On January 31, 2012, we acquired approximately 45% of the remaining outstanding shares of TBT in exchange for ~~10,973,678~~329,936 shares of our common stock. ~~Because of~~

With the acquisitions in September 2011 and January 2012 ~~acquisitions~~ of TBT common stock, we ~~currently~~ own approximately ~~98.62%~~99% of the outstanding shares of ~~TBT, and we control its board of directors and officer positions. The remaining 1.38% is owned by non-affiliated individuals that did not participate in the share exchange.~~TBT.

As a result of the ~~acquisition, TBT’s~~acquisitions, TBT's business is our business, and, unless otherwise indicated, any references to “we” or “us” include the business and operations of TBT.

WeOn March 9, 2020, our Board of Directors approved the amendment to our Certificate of Incorporation and stockholders holding 52.24% of our then outstanding voting stock approved the amendment to our Articles of Incorporation. The Certificate of Amendment to our Certificate of Incorporation was for the purpose of, among other things, (i) changing our name from “TransBiotec, Inc.” to “SOBR Safe, Inc.”, (ii) effecting a 1-for-33.26 reverse stock split of our common stock, and (iii) decreasing our authorized common stock from 800,000,000 shares to 100,000,000 shares, and became effective with the State of Delaware on April 24, 2020.

As a result of the reverse stock split effected by our Certificate of Amendment to our Certificate of Incorporation, every 33.26 shares of our outstanding common stock prior to the effect of that amendment were combined and reclassified into one share of our common stock, and the number of outstanding shares of our common stock has been reduced from 266,097,657 (pre-split) to approximately 8,000,000 (post-split), at that time. No fractional shares were issued in connection with the reverse stock split, and any of our stockholders that would have been entitled to receive a fractional share as a result of the reverse stock split will instead receive one additional share of our common stock in lieu of the fractional share. The reverse stock split will not in itself affect any stockholder’s ownership percentage of our common stock, except to the extent that any fractional share is rounded up to the nearest whole share.

At the open of trading on June 8, 2020, our new name and reverse stock split went effective with OTC Markets, and we began trading on the “OTC Pink Current Information” tier of OTC Markets on a post reverse stock split basis. Our ticker symbol for the quotation of our common stock is now “SOBR”.

As noted elsewhere herein, we have developed and patented a high technology, state-of-the-art transdermal sensing system that detects ~~blood~~ alcohol ~~levels~~ through a ~~person’s~~person's skin.

•	o	summarizes our plan of operation; and
•
	o	analyzes our financial condition and the results of our operations for the three ~~months~~ and six months ended June 30, ~~2019~~2020 and ~~2018.~~2019.

This discussion and analysis should be read in conjunction with ~~TBT’s~~our financial statements included as part of this Quarterly Report on Form 10-Q, as well as ~~TBT’s~~our financial statements included in ~~its~~our Annual Report on Form 10-K for the year ended December 31, ~~2018.~~2019.

Results of Operations for Three Months Ended June 30, ~~2019~~2020 Compared to Three Months Ended June 30, ~~2018~~2019

	Three Months Ended June 30,						Three Months Ended June 30,
	2019			2018			2020			2019
Revenue	$	-		$	-		$	-		$	-

Operating expenses:

General and administrative		81,483			82,925			177,915			81,483
Stock-based compensation expense								-			-
Management salaries and consulting fees								461,864			-
Research and development								89,570			-
Total operating expenses		81,483			82,925			729,349			81,483


Operating loss		(81,483	)		(82,925	)		(729,349	)		(81,483	)

Other income (expense):
Gain on fair value adjustment-derivatives		4,000			-
Loss on extinguishment of debt, net								(297,711	)		-
Gain on fair value adjustment – derivatives								61,350			4,000
Interest expense		(67,065	)		(68,189	)		(17,397	)		(67,065	)
Amortization – debt discount		(12,407	)		(500	)
Total other income (expense)		(75,472	)		(68,689	)
Amortization of interest – beneficial conversion feature								(1,407,501	)		(12,407	)
Asset impairment adjustment								(25,320,555	)		-
Total other (expense), net								(26,981,814	)		(75,472	)

Net loss	$	(156,955	)	$	(151,614	)	$	(27,711,163	)	$	(156,955	)

Our net loss increased by ~~$5,341~~$27,554,208 from ~~$151,614~~$156,955 to ~~$156,955,~~$27,711,163, from the ~~three month~~three-month period ended June 30, ~~2018~~2019 compared to the ~~three month~~three-month period ended June 30, ~~2019.~~2020. Our operating loss ~~decreased~~increased by ~~$1,442,~~$647,866, from ~~$82,925~~$81,483 to ~~$81,483~~$729,349 for the same periods. The change in our net loss for the three months ended June 30, ~~2019,~~2020, compared to the prior year period, is primarily a result of an asset impairment expense related to the assets we acquired from IDTEC during the quarter, as well as us having a $2,300 gain on fair value adjustment from derivatives in 2019 compared to none in 2018, partially offset by a decrease in interest expense due to the full amortization of debt issuance costs, an increase in amortization-debt discount, and a slight decreaseincreases in general and administrative expenses, management salaries and consulting fees, and research in ~~2019 compared~~development, all of which are primarily related to ~~2018.~~our increased operations and management team in connection with the closing of the transaction with IDTEC. The changes are detailed below.

We have not had any revenues since our inception. Since September 2011, we have been involved in the development, testing and marketing of ~~SOBR,~~SOBRCheck, our unique alcohol sensor technology. Although we have not had any sales to date, we ~~believe we~~ are ~~close~~planning to ~~our~~be ready to commercialize the SOBRCheck device in the first ~~sales and revenue, but that will be dependent upon our ability to raise sufficient funds to bring the SOBR device to market.~~quarter of 2021.

General and administrative expenses ~~decreased~~increased by ~~$1,442,~~$96,431, from ~~$82,925 for the three month period ended June 30, 2018 to~~ $81,483 for the three month period ended June 30, 2019 ~~primarily due~~ to ~~a decrease in insurance and consulting expenses.~~

~~Gain on fair value adjustment - derivatives was $4,000~~$177,914 for the three month period ended June 30, 2020, primarily due to increases in facilities rents, marketing and promotion, accounting and other professional fees.

Management salaries and consulting fees were $461,864 for the three months ended June 30, 2020. We did not have management salaries and consulting fees in the three months ended June 30, 2019, or such expenses were minimal and included in our general and administrative expenses. The management salaries and consulting fees in 2020 were related to salaries and fees paid to our management and consultants in the three months ended June 30, 2020.

Research and development was $89,570 for the three months ended June 30, 2020. We did not have research and development in the three months ended June 30, 2019, or such expenses were minimal and included in our general and administrative expenses. The research and development in 2020 was related to expenses to develop our SOBRCheck device.

Loss on extinguishment of debt, net was $297,711 for the three month period ended June 30, 2020, compared to $0 for the three month period ended June 30, ~~2018.~~2019. This increase was due to us ~~not~~converting several notes payable with conversion prices less than the fair market price on the conversion date during the three months ended June 30, 2020, but none during the three months ended June 30, 2019.

Gain on fair value adjustment – derivatives was $61,350 for the three months ended June 30, 2020, compared to $4,000 for the three months ended June 30, 2019. For both periods the amounts are related to us having aan outstanding financial instrument that contained an embedded derivative ~~liability at June 30, 2018, but having one at June 30, 2019.The~~liability. The gain ~~on fair value adjustment - derivative liability we recorded during~~related to the ~~three month period ended June 30, 2019 was an adjustment due~~instrument is tied to ~~us having a convertible note payable that contains an embedded derivative.~~

Interest expense decreased by ~~$1,124,~~$49,668, from ~~$68,189 for the three month period ended June 30, 2018 to~~ $67,065 for the three month period ended June 30, ~~2019.~~2019 to $17,397 for the three-month period ended June 30, 2020. For both periods these amounts are largely due to the ~~amortization of debt issuance costs and the~~ interest on outstanding debt.

During the three month period ended June 30, ~~2019,~~2020, our amortization of interest – ~~debt discount~~beneficial conversion feature was ~~$12,407~~$1,407,501, compared to ~~$500~~$12,407 during the ~~three month~~three-month period ended June 30, ~~2018.~~2019. The expense ~~is due~~in 2020 was related to the ~~unamortized~~amortized discount on a related party convertible note payable of $1,485,189. The expense in 2019 was related to the amortized discount on convertible non-related party notes payable.

We had an asset impairment adjustment of $25,320,555 in the three months ended June 30, 2020. We did not have an asset impairment adjustment in the three months ended June 30, 2019. The ~~increase is due~~asset impairment adjustment in 2020 was related to the ~~addition~~value of ~~two convertible non-related party notes payable~~the stock we issued to IDTEC that was attributed to the robotic assets we acquired from IDTEC versus the value of the assets. When we negotiated the transaction with ~~beneficial conversion features~~IDTEC in ~~2019.~~early-to-mid-2019, the agreed to issue IDTEC 12,000,000 shares of our common stock (post-split) in exchange for the consideration they were transferring to us at the close of the transaction. At the time we negotiated the transaction and signed the Asset Purchase Agreement, our common stock was trading at a lower price than what it was trading at when we closed the transaction and issued the shares. As a result, during the three months ended June 30, 2020, we impaired the value of the robotic assets we received in the transaction.

Results of Operations for Six Months Ended June 30, ~~2019~~2020 Compared to Six Months Ended June 30, ~~2018~~2019

	Six Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2020			2019
Revenue	$	-		$	-		$	-		$	-

Operating expenses:

General and administrative		150,497			162,768			276,107			150,497
Stock-based compensation expense								41,302			-
Management salaries and consulting fees								683,993			-
Research and development								157,280			-
Total operating expenses		150,497			162,768			1,158,682			150,497


Operating loss		(150,497	)		(162,768	)		(1,158,682	)		(150,497	)

Other income (expense):
Gain on fair value adjustment-derivatives		3,200			-
Loss on extinguishment of debt, net								(269,144	)		-
Gain on fair value adjustment – derivatives								60,650			3,200
Interest expense		(130,951	)		(132,216	)		(65,631	)		(130,951	)
Amortization – debt discount		(17,763	)		(500	)
Total other income (expense)		(145,514	)		(132,716	)
Amortization of interest – beneficial conversion feature								(1,407,675	)		(17,763	)
Asset impairment adjustment								(25,320,555	)		-
Total other (expense), net								(27,002,355	)		(145,514	)

Net loss	$	(296,011	)	$	(295,484	)	$	(28,161,037	)	$	(294,426	)

Our net loss increased by ~~$527~~$27,865,026 from ~~$295,484~~$296,011 to ~~$296,011,~~$28,161,037, from the six-month period ended June 30, ~~2018~~2019 compared to the six-month period ended June 30, ~~2019.~~2020. Our operating loss ~~decreased~~increased by ~~$12,271,~~$1,008,185, from ~~$162,768~~$150,497 to ~~$150,497~~$1,158,682 for the same periods. The change in our net loss for the six months ended June 30, ~~2019,~~2020, compared to the prior year period, is primarily a result of ~~us having a $3,200 gain on fair value adjustment from derivatives in 2019 compared to none in 2018, a decrease in interest~~an asset impairment expense related to ~~an increase in borrowings, an increase in amortization – debt discount, and a decrease~~the assets we acquired from IDTEC during the quarter, as well as us having increases in general and administrative expenses, management salaries and consulting fees, and research in ~~2019 compared~~development, all of which are primarily related to ~~2018.~~our increased operations and management team in connection with the closing of the transaction with IDTEC. The changes are detailed below.

General and administrative expenses ~~decreased~~increased by ~~$12,271,~~$125,610, from ~~$162,768 for the six-month period ended June 30, 2018 to~~ $150,497 for the ~~six-month~~six month period ended June 30, 2019 to $276,107 for the six month period ended June 30, 2020, primarily due to ~~a decrease~~increases in ~~insurance~~facilities rents, marketing and promotion, accounting and other professional fees.

We had stock based compensation expense of $41,302 for the six months ended June 30, 2020, compared to $0 for the six months ended June 30, 2019. The expense in 2020 was related to the issuance of our common stock as compensation to certain consultants and employees.

Management salaries and consulting fees were $683,993 for the six months ended June 30, 2020. We did not have management salaries and consulting fees in the six months ended June 30, 2019, or such expenses were minimal and included in our general and administrative expenses. The management salaries and consulting fees in 2020 were related to salaries and fees paid to our management and consultants in the six months ended June 30, 2020.

Research and development was $157,280 for the six months ended June 30, 2020. We did not have research and development in the six months ended June 30, 2019, or such expenses were minimal and included in our general and administrative expenses. The research and development in 2020 was related to expenses to develop our SOBRCheck device.

Loss on extinguishment of debt, net was $269,144 for the six month period ended June 30, 2020, compared to $0 for the six month period ended June 30, 2019. This increase was due to us converting several notes payable with conversion prices less than the fair market price on the conversion date during the six months ended June 30, 2020, but none during the six months ended June 30, 2019.

Gain on fair value adjustment -– derivatives was $60,650 for the six months ended June 30, 2020, compared to $3,200 for the ~~six-month period~~six months ended June 30, ~~2019, compared to $0 for~~2019. For both periods the ~~six-month period ended June 30, 2018. This increase was due~~amounts are related to us ~~not~~ having aan outstanding financial instrument that contained an embedded derivative ~~liability at June 30, 2018, but having one at June 30, 2019.~~liability. The gain ~~on fair value adjustment - derivative liability we recorded during~~related to the ~~six month period ended June 30, 2019 was an adjustment due~~instrument is tied to ~~us having a convertible note payable that contains an embedded derivative.~~the price of our common stock.

Interest expense decreased by ~~$1,265,~~$65,320, from ~~$132,216~~$130,951 for the six month period ended June 30, 2019 to $65,631 for the six-month period ended June 30, ~~2018 to $130,951 for the six-month period ended June 30, 2019.~~2020. For both periods these amounts are largely due to the ~~amortization of debt issuance costs and~~ interest on outstanding debt.

During the ~~six-month~~six month period ended June 30, ~~2019, our~~2020, we had amortization of interest – ~~debt discount was $17,763,~~beneficial conversion feature expense of $1,407,675 compared to ~~$500~~$17,763 during the six-month period ended June 30, ~~2018.~~2019. The expense isin 2020 was related to the ~~unamortized~~amortized discount on a related party convertible note payable of $1,485,189. The expense in 2019 was related to the amortized discount on convertible non-related party notes payable.

We had an asset impairment adjustment of $25,320,555 in the six months ended June 30, 2020. We did not have an asset impairment adjustment in the six months ended June 30, 2019. The ~~increase is due~~asset impairment adjustment in 2020 was related to the ~~addition~~value of ~~two convertible non-related party notes payable~~the stock we issued to IDTEC that was attributed to the robotic assets we acquired from IDTEC versus the value of the assets. When we negotiated the transaction with ~~beneficial conversion features~~IDTEC in ~~2019.~~early-to-mid-2019, the agreed to issue IDTEC 12,000,000 shares of our common stock (post-split) in exchange for the consideration they were transferring to us at the close of the transaction. At the time we negotiated the transaction and signed the Asset Purchase Agreement, our common stock was trading at a lower price than what it was trading at when we closed the transaction and issued the shares. As a result, during the six months ended June 30, 2020, we impaired the value of the robotic assets we received in the transaction.

Liquidity and Capital Resources for Six Months Ended June 30, ~~2019~~2020 Compared to Six Months Ended June 30, ~~2018~~2019

During the six months ended June 30, ~~2019~~2020 and ~~2018,~~2019, because of our operating losses, we did not generate positive operating cash flows. Our cash on hand as of June 30, ~~2019 was $4,931~~2020 is $727,633 and our monthly cash flow burn rate is approximately ~~$25,000.~~$125,000. As a result, we do not have ~~significant~~ short term cash ~~needs. These~~needs, but need to raise additional funds to finance our long term business plans. Our cash needs are being satisfied through proceeds from the sales of our securities and loans from both related parties and third parties. We currently do not believe we will be able to satisfy our cash needs from our revenues for some time, and there is no guarantee we will be successful in the future satisfying these needs through the proceeds generated from the sales of our securities.

Our cash, current assets, total assets, current liabilities, and total liabilities as of June 30, ~~2019~~2020 and as of December 31, ~~2018,~~2019, respectively, are as follows:

	June 30, 2019		December 31, 2018		Change		June 30, 2020		December 31, 2019		Change

Cash	$	4,931	$	89	$	4,842	$	727,633	$	681,759	$	45,874
Total Current Assets	$	15,897	$	13,080	$	2,817	$	743,567	$	690,813	$	52,754
Total Assets	$	15,897	$	13,080	$	2,817	$	4,621,420	$	690,813	$	3,930,607
Total Current Liabilities	$	3,645,787	$	3,436,511	$	209,276	$	4,143,064	$	4,283,934	$	(140,870	)
Total Liabilities	$	3,645,787	$	3,436,511	$	209,276	$	4,143,064	$	4,283,934	$	(140,870	)

Our current assets increased ~~slightly~~ as of June 30, ~~2019,~~2020, as compared to December 31, ~~2018,~~2019, due to us having slightly more cash on hand ~~offset by slightly less prepaid expenses~~and having related party receivables at June 30, ~~2019.~~2020. The increase in our total assets between the two periods ~~was also~~is primarily related to our acquisition of assets related to the ~~increased cash on hand as~~closing of ~~June 30, 2019, offset by the slightly less prepaid expenses.~~our Asset Purchase Agreement with IDTEC, LLC.

Our current liabilities ~~increased by $209,276~~decreased as of June 30, ~~2019~~2020, as compared to December 31, ~~2018.~~2019. This ~~increase~~decrease was primarily due to ~~increases in notes payable – related parties, notes payable - non-related parties, derivative liabilities, accrued interest payable, and related party payables, offset by~~significant decreases in accounts payable, accrued interest payable, related party payables and ~~accrued expenses.~~derivative liabilities, offset by increases in common stock subscription payables, preferred stock subscriptions payable, and notes payable-related parties.

In order to repay our obligations in full or in part when due, we will be required to raise significant capital from other sources. There is no assurance, however, that we will be successful in these efforts.

We had net cash used for operating activities of $765,791 for the six-month period ended June 30, 2020, as compared to net cash used for operating activities of $168,908 for the six-month period ended June 30, ~~2019, as compared to~~2019. For the period in 2020, the net cash used ~~for~~in operating activities consisted primarily of ~~$57,564 for the six-month period ended June 30, 2018.~~our net loss of $28,161,037 and change in fair value of derivative liability of $60,650, offset by a loss on debt extinguishment, net of $269,144, depreciation and amortization of $33,227, amortization of interest – beneficial conversion feature of $1,407,675, stock warrants expense of $8,856, stock options expense of $296,932, stock-based compensation expense of $41,302, and impairment loss of $25,320,555, and changes in our assets and liabilities of related party receivables of $6,446, prepaid expenses of $434, other assets of $8,680, accounts payable of $123,736, accrued expenses of $39,644, accrued interest payable of $47,675, and related party payables of $21,740. For the period in 2019, the net cash used in operating activities consisted primarily of our net loss of $296,011 and change in fair value of derivative liability of $3,200, offset by stock warrants expense of $15,093, amortization – debt discount of $17,763, and changes in our assets and liabilities of prepaid expenses of $2,025, accounts payable of $28,617, accrued expenses of $1,428, accrued interest payable of $78,767, related party payables of $45,913, and stock subscriptions payable of $787, and prepaid expenses of $2,025. For the period in 2018, the net cash used in operating activities consisted primarily of our net loss of $293,859, offset by stock warrants expense of $22,517, stock options expense of $4,500, stock-based compensation expense of $7,999, amortization – debt discount of $500, and changes in our accounts payable of $116,142, accrued expenses of $20,925, accrued interest payable of $81,401, related party payables of $208,555, stock subscriptions payable of $557, and prepaid expenses of $5,483.$787.

We had no cash provided by or used for investing activities during the six-month period ended June 30, ~~2019~~2020 or June 30, ~~2018.~~2019.

Our net cash provided by financing activities for the six-month period ended June 30, ~~2019~~2020 was ~~$173,750,~~$811,665, compared to ~~$61,300~~$173,750 for the six-month period ended June 30, ~~2018.~~2019. For the six-month period ended June 30, 2020, our net cash from financing activities consisted of proceeds from offering of preferred stock – related parties of $770,000, and proceeds from notes payable – non-related parties of $41,665. For the six-month period ended June 30, 2019, our net cash from financing activities consisted of proceeds from notes payable – related parties of $74,750, proceeds from notes payable – non-related parties of $60,000, and proceeds from issuances of common stock – non-related parties of $39,000. ~~For~~

On January 30, 2020, the ~~six month period ended June 30, 2018,~~World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the “COVID-19 outbreak”) and the risks to the international community as the virus spreads globally beyond its point of origin. In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. The full impact of the COVID-19 outbreak continues to evolve as of the date of this filing. Management is actively monitoring the global situation on our ~~net cash from financing activities consisted~~financial condition, liquidity, operations, suppliers, industry, and workforce. Given the daily evolution of ~~proceeds from notes payable – related parties~~the COVID-19 outbreak and the global responses to curb its spread, we are not able to estimate the effects of ~~$55,300~~the COVID-19 outbreak on our results of operations, financial condition, or liquidity for fiscal year 2020. However, if the pandemic continues, it could have an adverse effect on our results of future operations, financial position, and ~~proceeds from notes payable – non related parties of $6,000.~~liquidity in year 2020.

We have no off balance sheet arrangements as of June 30, ~~2019~~2020 and December 31, ~~2018.~~2019.

As a smaller reporting company, we are not required to provide the information required by this Item.

Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Disclosure and control procedures are also designed to ensure that such information is accumulated and communicated to management, including the chief executive officer and chief financial officer, to allow timely decisions regarding required disclosures.

As of June 30, ~~2019,~~2020, we carried out an evaluation, under the supervision and with the participation of management, including our chief executive officer (our Principal Executive Officer) and chief financial officer (our Principal Financial Officer), of the effectiveness of the design and operation of our disclosure controls and procedures. In designing and evaluating the disclosure controls and procedures, management recognizes that there are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their desired control objectives. Additionally, in evaluating and implementing possible controls and procedures, management is required to apply its reasonable judgment. We also do not have an audit committee. Based on the evaluation described above, and as a result, in part, of not having an audit committee and having one individual serve as our chief executive officer and another individual serve as our chief financial officer, management has concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were not effective to the same extent as reported in our Annual Report on Form 10-K for the year ended December 31, ~~2018.~~2019.

As funds become available to us, we expect to implement additional measures to improve disclosure controls and procedures.

There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

Appearing as an exhibit to this quarterly report on Form 10-Q are “Certifications” of our Chief Executive and Financial Officer. The Certifications are required pursuant to Sections 302 of the Sarbanes-Oxley Act of 2002 (the “Section 302 Certifications”). This section of the quarterly report on Form 10-Q contains information concerning the Controls Evaluation referred to in the Section 302 Certifications. This information should be read in conjunction with the Section 302 Certifications for a more complete understanding of the topics presented.

We currently have one outstanding judgment against us involving a past employee of the Company. The matter is under the purview of the State of California, Franchise Tax Board, Industrial Health and Safety Collections. We currently owe approximately $28,786 plus accrued interest, to our ex-employee for unpaid wages under these Orders and are working to get this amount paid off.

In the ordinary course of business, we are from time to time involved in various pending or threatened legal actions. The litigation process is inherently uncertain and it is possible that the resolution of such matters might have a material adverse effect upon our financial condition and/or results of operations. However, in the opinion of our management, other than as set forth herein, matters currently pending or threatened against us are not expected to have a material adverse effect on our financial position or results of operations.

As a smaller reporting company, we are not required to provide the information required by this Item.

During the three months ended June 30, ~~2019~~2020 we ~~did not issue any~~issued the following unregistered ~~securities.~~securities:

On April 1, 2020, we issued 75,165 shares of our common stock to a non-related party in exchange for their agreement to settle an accounts payable of $43,750 owed to them. The shares were issued at a value of $0.58205 per share and were issued pursuant to the terms of a Common Stock Purchase Agreement. The conversion was in partial satisfaction of the amounts owed to the non-related party. The issuance of the shares was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact the investor was known to our management team, is a sophisticated investor and familiar with our operations.

On April 6, 2020, we issued 38,437 shares of our common stock to Nick Noceti, our former Chief Financial Officer, in exchange for amounts due to him for accounting fees included in accounts payable. The amount of the debt reduction, and therefore the purchase price of the shares, was $127,840. The issuance of the shares was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact the investor was known to our management team, is a sophisticated investor and familiar with our operations.

On April 7, 2020, we issued 6,831 shares of our common stock to Charles Bennington, one of the Company’s directors and a former executive officer, in exchange for amounts due for Board of Director fees included in accounts payable. The amount of the debt reduction, and therefore the purchase price of the shares, was $9,656. The issuance of the shares was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, due to the fact the investor is on our Board of Directors, is a sophisticated investor and familiar with our operations.

On April 20, 2020, we issued 9,346 shares of our common stock at $1.04 per share to a non-related party in exchange for their agreement to settle a payable balance of $9,714 owed to them. The conversion was in full satisfaction of all outstanding amounts owed.

On April 21, 2020, we issued 36,560 shares of our common stock at $1.04 per share to a non-related party in exchange for their agreement to settle a payable balance of $38,000 owed to them. The conversion was in full satisfaction of all outstanding amounts owed.

As noted herein, on June 5, 2020, we closed the Transaction with IDTEC. As a result, we issued 12,000,000 shares of our common stock (after giving effect to the 1-for-33.26 reverse stock split described herein). These shares were issued with a standard Rule 144 restrictive legend. The issuance of the shares was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933. The investor was sophisticated, familiar with our operations, and there was no solicitation.

In connection with closing the Transaction, we also issued a convertible promissory note totaling approximately $1,500,000 to IDTEC. The promissory note is convertible any time by the holder into shares of our common stock at a conversion price of $0.50 per share, subject to anti-dilution protection against any future securities we may issue at an effective price of less than $0.50 per share. The issuance of the promissory notes was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933. The investors were sophisticated, familiar with our operations, and there was no solicitation.

As noted herein, on June 5, 2020, we closed the Transaction with IDTEC and entered into the Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement with IDTEC. As a result, we issued a Warrant to Purchase Common Stock to IDTEC, under which IDTEC will purchase up to 320,000 shares of our common stock (post-split) at an exercise price of $0.50 per share (after giving effect to the 1-for-33.26 reverse stock split described herein). The issuance of the Warrant was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933. The investor was sophisticated, familiar with our operations, and there was no solicitation.

During the three months ended June 30, 2020, we sold 747,000 shares of our 8% Series A-1 Preferred Stock to SOBR Safe, LLC, in exchange for $747,000. The issuance of the shares was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933. The investor was sophisticated, familiar with our operations, and there was no solicitation.

On ~~April 17, 2019,~~December 28, 2010, the Company borrowed ~~$30,000~~$11,810 from a related party. The note payable carries an interest rate of 7%0% and matured on ~~May~~December 31, 2012. As of June 30, ~~2019. This~~2020 this note ~~also contained a stock fee of 6,000,000 shares which will be used to pay down 80% of the note principal balance. This note is currently~~was in default.

On February 20, 2012, the Company borrowed $3,750 from a non-related party. The note payable carries an interest rate of 12% and matured on February 19, 2013. As of June 30, 2020 this note was in default.

On March 20, 2012, the Company borrowed $5,433 from a non-related party. The note payable carries an interest rate of 12% and matured on March 19, 2013. As of June 30, 2020 this note was in default.

On September 27, 2013, the Company borrowed $15,000 from a non-related party. The note payable carries an interest rate of 9% and matured on December 25, 2013. As of June 30, 2020 this note was in default.

On March 14, 2014, the Company borrowed $5,000 from a non-related party. The note payable carries an interest rate of 10% and matured on September 14, 2014. As of June 30, 2020 this note was in default.

On July 31, 2015, the Company borrowed $2,500 from a non-related party. The note payable carries an interest rate of 10% and matured on November 28, 2015. As of June 30, 2020 this note was in default.

On June 5, 2020, we closed the transaction (the “Transaction”) that was the subject of that certain Asset Purchase Agreement dated May 6, 2019 ~~we signed a definitive Asset Purchase Agreement (the~~(and Amendment No. 1 dated March 9, 2020, together the “APA”) with IDTEC, LLC (“IDTEC”), under which IDTEC agreed to ~~acquire~~provide personnel, experience, and access to funding to assist with the development of our SOBR device, as well as to sell to us certain ~~assets related to~~ robotics ~~equipment,~~assets, which our management believes isare synergistic with our current assets, ~~from IDTEC~~ in exchange for 12,000,000 shares of our common stock ~~equal~~after giving effect to ~~60%~~the reverse stock split effected in connection with closing the transaction. The closing of ~~our then outstanding common stock. The APA is~~the Transaction was subject to several conditions precedent, primarily: (i) we ~~must~~had to be current in our reporting requirements under the Securities Exchange Act of 1934, as amended, (ii) we ~~must~~had to complete a reverse stock split of our common stock such that approximately 8,000,000 shares ~~will be~~were outstanding immediately prior to closing the transaction, ~~with no~~(iii) we could only have outstanding convertible instruments ~~other than~~ as set forth in the APA, ~~and~~(iv) our authorized common stock ~~must~~had to be reduced to 100,000,000 shares, ~~(iii)~~and (v) we ~~must~~could not have more than approximately ~~$150,000~~$125,000 in current ~~liabilities, and (iv) IDTEC must complete any necessary audits and reviews~~liabilities. Effective with the closing of the ~~financial statements related~~transaction all of the closing conditions had been met, modified or waived by IDTEC, and we issued the 12,000,000 shares to IDTEC in exchange for IDTEC providing access to personnel, experience, funding to assist with the ~~assets by a PCAOB-approved independent registered accounting firm.~~

development of our SOBR device, as well as the robotics assets. The description of the APA set forth in this report is qualified in its entirety by reference to the full text of that document and the amendment, which are attached hereto as Exhibits 10.1 and 10.12, respectively.

As noted above, in connection with the closing of the Transaction, both companies had certain closing conditions under the APA that had to be met. At closing, some of the closing conditions under the APA were either waived and/or modified by the parties. In order to document those modifications and waivers, we entered into a Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement with IDTEC. The description of the Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement set forth in this report is qualified in its entirety by reference to the full text of that document, which is attached hereto as Exhibit ~~10.6 to this Quarterly Report on Form 10-Q and is incorporated herein by reference.~~10.14.

~~The assets being acquired, if~~One of the closing ~~occurs,~~conditions that was the subject of the Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement was the requirement that we have under $125,000 in permitted liabilities (not including aged liabilities) after closing of the Transaction. At closing we had approximately $158,000 in non-permitted liabilities under the ~~APA~~APA. As a result, we issued a Warrant to Purchase Common Stock to IDTEC (the “Warrant”), under which IDTEC will purchase up to 320,000 shares of our common stock (post-split) at an exercise price of $0.50 per share, if either (i) we are forced to pay a non-permitted liability, then we may force IDTEC to exercise the ~~same assets that were subject~~Warrant and pay the exercise price to pay the non-permitted liability, but only in an amount sufficient to pay the non-permitted liability (which are listed on Exhibit A of the Warrant), or (ii) if IDTEC otherwise elects to exercise the Warrant and acquire some or all of the shares underlying the Warrant. The Warrant expires five years after the date of issuance. The description of the Warrant set forth in this report is qualified in its entirety by reference to the ~~Letter~~full text of ~~Intent with First Capital Holdings, LLC we previously announced in our Current Report on Form 8-K filed on November 6, 2018.~~that document, which is attached hereto as Exhibit 10.15.

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registrati0n statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

(1)	~~(1)~~	Incorporated by reference from our Registration Statement on Form SB-2, filed with the Commission on January 31, 2008
(2)
	~~(2)~~	Incorporated by reference from our Registration Statement on Form S-1, filed with the Commission on November 6, 2012
(3)
	~~(3)~~	~~Incorporated by reference from our Quarterly Report on Form 10-Q for the period ended June 30, 2017, filed with the Commission on August 21, 2017~~

	~~(4)~~	Incorporated by reference from our Annual Report on Form 10-K for the year ended December 31, 2017, filed with the Commission on February 6, 2019
(4)
	~~(5)~~	Incorporated by ~~referenced~~reference from our Current Report on Form 8-K, filed with the Commission on May 14, 2019.

(5)	Incorporated by reference from our Current Report on Form 8-K, filed with the Commission on September 10, 2019.
37 (6)	Incorporated by reference from our Current Report on Form 8-K, filed with the Commission on November 19, 2019
(7)	Incorporated by reference from our Current Report on Form 8-K, filed with the Commission on December 23, 2019
(8)	Incorporated by reference from our Annual Report on Form 10-K, filed with the Commission on April 17, 2020
(9)	Incorporated by reference from our Quarterly Report on Form 10-Q for the period ended March 31, 2020, filed with the Commission on May 26, 2020
(10)	Incorporated by reference from our Current Report on Form 8-K filed with the Commission on June 11, 2020

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.

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

885 Arapahoe Road Boulder, CO		80302
(Address of principal executive offices)		(Zip Code)

PART I – FINANCIAL INFORMATION

ITEM 1	Condensed Consolidated Financial Statements			3

ITEM 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations		37	28

ITEM 3	Quantitative and Qualitative Disclosures About Market Risk			35 46

ITEM 4	Controls and Procedures		46
		35

PART II – OTHER INFORMATION

ITEM 1	Legal Proceedings			36 47

ITEM 1A	Risk Factors			36 47

ITEM 2	Unregistered Sales of Equity Securities and Use of Proceeds		47	36

ITEM 3	Defaults Upon Senior Securities		48
		36

ITEM 4	Mine Safety Disclosures		49
		36

ITEM 5	Other Information			36 49

ITEM 6	Exhibits		50	37

Dividend yield		0	%
Expected volatility	133% - 171		%
Risk free interest rate	0.43% - 1.70		%
Expected life	1.5 - 7.17 years

2021				2022				2023				2024				2025				Thereafter
$	385,467			$	385,467			$	385,467			$	385,467			$	385,467			$	1,895,218

Balance at December 31, 2019	$	60,650
Fair market value adjustments including settlements		(60,650	)
Balance at June 30, 2020	$	0

Title of each class		Trading Symbol(s)			Name of each exchange on which registered
None		None			None

	For The Six Months Ended
	June 30,
	2019			2018

Operating Activities:
Net loss	$	(296,011	)	$	(293,859	)

Adjustments to reconcile net loss to net cash used in
operating activities:
Change in fair value of derivative liability		(3,200	)		-
Amortization - debt discount		17,763			500
Stock warrants expense		15,093			22,517
Stock options expense		-			4,500
Stock-based compensation expense		-			7,999
Changes in assets and liabilities:
Prepaid expenses		2,025			5,483
Accounts payable		(28,617	)		(116,142	)
Accrued expenses		(1,428	)		20,925
Accrued interest payable		78,767			81,401
Related party payables		45,913			208,555
Stock subscriptions payable		787			557

Net cash used in operating activities		(168,908	)		(57,564	)

Financing Activities:
Proceeds from notes payable - related parties		74,750			55,300
Proceeds from notes payable - non-related parties		60,000			6,000
Proceeds from issuances of common stock - non-related parties		39,000			-
Net cash provided by financing activities		173,750			61,300

Net Change In Cash		4,842			3,736

Cash At The Beginning Of The Period		89			142

Cash At The End Of The Period	$	4,931		$	3,878

Schedule Of Non-Cash Investing And Financing Activities:

Gain on related party payables converted to capital	$	15,522		$	15,571

Relative fair value of stock warrants granted	$	35,030		$	29,701

Fair value of embedded conversion feature	$	56,100		$	-

Intrinsic value - beneficial conversion feature	$	-		$	6,000

Research and development prepaid expenses with commons shares	$	-		$	25,800

Supplemental Disclosure:

Cash paid for interest	$	3,750		$	-

Cash paid for income taxes	$	-		$	-

	For The Six Months Ended June 30,
	2020			2019

Operating Activities:
Net loss	$	(28,161,037	)	$	(296,011	)

Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		33,227			-
Loss on debt extinguishment, net		269,144			-
Change in fair value of derivative liability		(60,650	)		(3,200	)
Amortization of interest - beneficial conversion feature		1,407,675			17,763
Stock warrants expense		8,656			15,093
Stock options expense		296,932			-
Stock-based compensation expense		41,302			-
Impairment loss		25,320,555			-
Changes in assets and liabilities:
Related party receivables		(6,446	)		-
Prepaid expenses		(434	)		2,025
Other assets		(8,680	)		-
Accounts payable		123,736			(28,617	)
Accrued expenses		39,644			(1,428	)
Accrued interest payable		(47,675	)		78,767
Related party payables		(21,740	)		45,913
Stock subscriptions payable		-			787

Net cash used in operating activities		(765,791	)		(168,908	)

Financing Activities:
Proceeds from notes payable - related parties		-			74,750
Proceeds from notes payable - non-related parties		41,665			60,000
Proceeds from issuances of common stock - non-related parties		-			39,000
Proceeds from offering of preferred stock - related parties		770,000			-
Net cash provided by financing activities		811,665			173,750

Net Change In Cash		45,874			4,842

Cash At The Beginning Of The Period		681,759			89

Cash At The End Of The Period	$	727,633		$	4,931

Schedule Of Non-Cash Investing And Financing Activities:

Gain on related party payables converted to capital	$	272,299		$	15,522

Accounts payables and accrued expenses converted to capital	$	265,677		$	-

Related party payables converted to capital	$	579,814		$	-

Related party debt converted to capital after exercise of cashless stock warrants	$	65,728		$	-

Related party debt converted to capital	$	826,964		$	-

Non-related party debt converted to capital	$	166,526		$	-

Gain on related party debt converted to capital	$	124,291		$	-

Shares issued for cash received in prior years	$	20,800		$	-

Fair value of stock warrants granted	$	-		$	35,030

Fair value of embedded conversion feature	$	-		$	56,100

Issuance of common stock, stock warrants and convertible note for asset purchase	$	29,222,955		$	-

Intrinsic value beneficial conversion feature	$	1,407,501		$	-

Supplemental Disclosure:

Cash paid for interest	$	765		$	3,750

Cash paid for income taxes	$	-		$	-

	1.	To remove and re-elect four (4) directors to serve until the next Annual Meeting of Shareholders and thereafter until their successors are elected and qualified; and

	2.	To approve an amendment to the Company’s Certificate of Incorporation to: (a) change the Company’s name to SOBR SAFE, Inc., (b) decrease the Company’s authorized common stock from 800,000,000 shares, par value $0.00001 to 100,000,000 shares, par value $0.00001, and (c) effect a reverse stock split of the Company’s outstanding common stock at a ratio between 1-for-32 and 1-for-35 (with the exact ratio to be determined by the directors in their sole discretion without further approval by the shareholders).

Property and equipment	$	47,725
Intangible assets		29,175,230
Total assets	$	29,222,955

Net purchase (fair value of stock issued, warrants and funds spent)	$	29,222,955

	June 30,			December 31,
	2020			2019
Robotics and testing equipment	$	46,200		$	-
Office furniture and equipment		45,208			43,683
		91,408			43,683
Accumulated depreciation		(44,788	)		(43,683	)
Property and equipment, net	$	46,620		$	-

	Gross Carrying		Accumulated		Net Intangible		Amortization Period
	Amount		Amortization		Asset		(in years)
SOBR Safe
Intellectual Technology	$	3,854,675	$	32,122	$	3,822,553		10

	June 30, 2019			December 31, 2018

Convertible Notes Payable	$	91,000		$	91,000
Conventional Non-Convertible Notes Payable		343,700			343,700
Notes Payable with Detached Free-standing Warrants		345,894			271,144
Unamortized Discount		(28,011	)		(8,074	)
Net Related Party Notes Payable	$	752,583		$	697,770

Balance at December 31, 2018	$	-
Fair value of derivatives issued		56,100
Fair market value adjustments		(3,200	)
Balance at June 30, 2019	$	52,900


Exercisable at December 31, 2019	598,414	$	0.13304 – 1.039375	3.97 Years	$	0.3607	$	1,276,870
Exercisable at June 30, 2020	464,317	$	0.050 - 1.039375	4.16 Years	$	0.66765	$	1,036,521

	Options Outstanding Number of Shares		Exercise Price Per Share		Weighted Average Remaining Contractual Life	Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value
Balance at December 31, 2019		2,381,239	$	0.2634 - 1.039	8.86 Years	$	0.2946	$	5,238,080
Options Granted		140,000	$	0.2634 – 2	4.54 Years	$	1.7504	$	160,732
Options Exercised		-		-
Options Cancelled		-		-
Options Expired		-		-
Balance at June 30, 2020		2,521,239	$	0.26342 – 2	8.15 Years	$	0.3170	$	6,512,360

Exercisable at December 31, 2019			539,847		$	0.2634 – 1.03938		8.93 Years		$	0.4			$	1,129,786
Exercisable at June 30, 2020			1,040,355		$	0.26342 – 2		8.93 Years		$	0.5359			$	2,459,933

Item No.	Description

3.1 (1)	Articles of Incorporation of Imagine Media, Ltd.

3.2 (2)	Articles of Amendment to Articles of Incorporation to TransBiotec, Inc.
~~3.3 (4)~~
3.3 (3)	Certificate of Amendment to Certificate of Incorporation filed with the State of Delaware on May 25, 2017
~~3.3 (1)~~
3.4 (6)	Amended and Restated Bylaws of ~~Imagine Media, Ltd.~~SOBR Safe, Inc.

3.5 (10)	Certificate of Amendment to Certificate of Incorporation of TransBiotec, Inc. changing name to SOBR Safe, Inc., effecting 1-for-33.26 reverse stock split and decreasing authorized common stock to 100M shares

10.1 ~~(1)~~(4)	~~Spin-off Trust Agreement by and between Gregory A. Bloom and Imagine Holding Corp. dated August 10, 2007~~
~~10.2 (1)~~		~~Form of Work For Hire Agreement~~
~~10.3 (1)~~		~~Assignment and Assumption Agreement by and between Imagine Holding Corp. and Imagine Media, Ltd. dated August 23, 2007~~
~~10.4 (3)~~		~~Form of Series A Stock Purchase Agreement~~
~~10.5 (3)~~		~~Form of Amendment No. 1 to Series A Preferred Stock Purchase Agreement~~
~~10.6 (5)~~		Asset Purchase Agreement dated May 6, 2019 between IDTEC, LLC and TransBiotec, Inc.

~~31.1~~10.2 (5)	Common Stock Purchase Agreement with Charles Bennington dated August 23, 2019

10.3 (5)	Share Exchange Agreement with Michael Lanphere dated August 23, 2019

10.4 (5)	Share Exchange Agreement with Vernon Justus dated August 23, 2019

10.5 (5)	Debt Conversion and Common Stock Purchase Agreement with Michael Lanphere dated August 23, 2019

10.6 (5)	Debt Conversion and Common Stock Purchase Agreement with Devadatt Mishal dated August 23, 2019

10.7 (6)	TransBiotec, Inc. 2019 Equity Incentive Plan

10.8 (6)	Employment Agreement with Kevin Moore dated October 25, 2019

10.9 (8)	Amended Employment Agreement with Kevin Moore dated November 26, 2019

10.10 (6)	Employment Agreement with David Gandini dated October 25, 2019

10.11 (7)	Series A-1 Preferred Stock Purchase Agreement by and between TransBiotec, Inc. and SOBR SAFE, LLC dated December 12, 2019 (with Series A-1 Preferred Stock Certificate of Designation attached)

10.12 (9)		Amendment No. 1 to Asset Purchase Agreement dated March 23, 2020 by and between IDTEC, LLC and TransBiotec, Inc.

10.13 (10)		Form of Convertible Promissory Note Issued to IDTEC, LLC at Close of Asset Purchase Transaction

10.14 (10)		Waiver Under Asset Purchase Agreement and Post-Closing Covenant Agreement dated June 5, 2020 by and between IDTEC, LLC and TransBiotec, Inc.

10.15 (10)		Warrant to Purchase Common Stock dated June 5, 2020 issued to IDTEC, LLC

31.1*		Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer (filed herewith)
~~31.2~~
31.2*		Rule 13a-14(a)/15d-14(a) Certification of Chief Accounting Officer (filed herewith)
~~32.1~~
32.1*		Section 1350 Certification of Chief Executive Officer (filed herewith).
~~32.2~~
32.2*		Section 1350 Certification of Chief Accounting Officer (filed herewith).

101.INS **		XBRL Instance Document

101.SCH **		XBRL Taxonomy Extension Schema Document

101.CAL **		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF **		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB **		XBRL Taxonomy Extension Label Linkbase Document

101.PRE **		XBRL Taxonomy Extension Presentation Linkbase Document

	~~TransBiotec,~~SOBR Safe, Inc.

Dated: ~~January 31,~~August 19, 2020	By:	/s/ ~~Charles Bennington~~Kevin Moore
		~~Charles Bennington~~Kevin Moore
		Its:	Chief Executive Officer and Principal Executive Officer