As filed with the Securities and Exchange Commission on December 15, 2010

Registration Statement No.

 

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form S-1

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

T3 MOTION, INC.

Delaware		3690		20-4987549
(State or other jurisdiction of		(Primary Standard Industrial		(I.R.S. Employer
incorporation or organization)		Classification Code Number)		Identification No.)

T3 Motion, Inc.
2990 Airway Avenue, Suite A
Costa Mesa, CA 92626
(714) 619-3600
(Address and telephone number of principal executive offices and principal place of business)

Ki Nam,
Chief Executive Officer
T3 Motion, Inc.
2990 Airway Avenue, Suite A
Costa Mesa, CA 92626
(714) 619-3600
(Name, address and telephone number of Agent for Service)

Kevin K. Leung, Esq.		Joseph Smith
Ryan S. Hong, Esq.		Robert Charron
LKP Global Law, LLP		Weiinstein Smith LLP
1901 Avenue of the Stars, Suite 480		420 Lexington Avenue, Suite 2620
Los Angeles, California 90067		New York, NY 10170
Tel (424) 239-1890		Tel: (212-616-3007
Fax (424) 239-1882		Fax: 212-401-4741

     Approximate date of proposed sale to the public: As soon as practical after the effective date of this Registration Statement.

     If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. þ

     If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

     If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

     If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

     Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o		Accelerated filer o		Non-accelerated filer o		Smaller reporting company þ
				(Do not check if a smaller reporting company)

CALCULATION OF REGISTRATION FEE

Proposed Maximum

Proposed Maximum

Amount of

Title of Each Class of

Amount to be

Offering

Aggregate

Registration

Securities to be Registered (1)

Registered

Price per Share(2)

Offering Price

Fee

Units, each consisting of one share of Common Stock, $0.001 par value, and one Class H Warrant and one Class I Warrant (3)(4)

$0.00

$6,000,000

$427.00

Shares of Common Stock included as part of the Units (4)

$0.00

Class H Warrants included as part of the Units (4)

$0.00

Class I Warrants included as part of the Units (4)

$0.00

Shares of Common Stock underlying the Class H Warrants included in the Units (5)

$0.00

Shares of Common Stock underlying the Class I Warrants included in the Units (5)

$0.00

Representatives Unit Purchase Option

$0.00

Units underlying the Representative’s Unit Purchase Option (“Underwriters’ Units”)(5)

$0.00

Shares of Common Stock included as part of the Underwriters’ Units (5)

$0.00

Class H Warrants included as part of the Underwriters’ Units (5)

$0.00

Shares of Common Stock underlying the Class H Warrants included in the Underwriters’ Units (5)

$0.00

Class I Warrants included as part of the Underwriters’ Units (5)

Shares of Common Stock underlying the Class I Warrants included in the Underwriters’ Units (5)

     The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to Section 8(a), may determine.

 

 

THIS INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

SUBJECT TO COMPLETION, DATED _____________, 2010

PRELIMINARY PROSPECTUS

T3 Motion, Inc.

_________ Units

     We are offering [          ] units of our securities, each unit consisting of one share of our common stock, one Class H warrant and one Class I warrant. Each Class H warrant entitles the holder to purchase one share of our common stock at a price of $ , and will expire on _______ [NINE MONTH ANNIVERSARY OF THE PROSPECTUS]. The Class H warrants cannot be exercised until three months after issuance. Each Class I warrant entitles the holder to purchase one share of our common stock at a price of $ , and will expire on [FIVE-YEAR ANNIVERSARY OF THE PROSPECTUS]. The Class I warrants cannot be exercised until three months after issuance.

     The initial public offering price for the units offered hereby is estimated to be between $___ and $____ per unit. Immediately prior to the effectiveness of the registration statement of which this prospectus is a part, we will effect a [_]-for-1 reverse stock split which will change the price of our common stock to approximately $ a share. The aggregate price of the units offered hereby, assuming a mid point price, excluding units that may be sold on exercise of the underwriters’ over-allotment option, is $__________.

     We have granted a 45-day option to the underwriters, to purchase up to 15.0% additional units solely to cover over-allotments, if any (over and above the __________ units referred to above). The units issuable upon exercise of the underwriters’ option are identical to those offered by this prospectus. The underwriters’ option and the units underlying the underwriter option have been registered under the registration statement of which this prospectus forms a part. We have also agreed to sell a unit purchase option to the underwriters as additional compensation to purchase up to 5% of the units offered to the public (excluding over allotment option) at 110% of the public offering price per unit.

     The shares of common stock and warrants will trade only as a part of a unit for three months following the closing of this offering unless separate trading is authorized earlier by the representative of the underwriters, whereupon we will issue a press release announcing that separate trading will begin. We may redeem the Class H warrants at our sole election, in whole and not in part, if, and only if, the reported last sale price of the common stock equals or exceeds $____ per share for any __ consecutive trading days within a ___ trading day period ending on the third business day prior to the _-day notice of redemption to warrant holders at a price of $0.01 per warrant, but only after the Class H Warrants have been separated from the units. The Class I warrants are not redeemable.

     Our common stock is quoted on the OTCBB under the symbol “TMMM.” The last sale price of our common stock on December 1, 2010 was $0.50 per share. We have applied to have the common stock, units, H warrants and I warrants listed on the [NYSE AMEX Markets] (“AMEX”) under the symbols “____”,“____”,“____”, and “______” on or promptly after the date of this prospectus.

     Our common stock and warrants are more fully described in the section of this prospectus titled “Description of Securities.”

     There is presently no public market for our units or Class H and Class I warrants, and we do not expect there to be any active market for any of such securities.

     Certain of our existing stockholders, including each of our directors and officers and each holder of more than 5% of the outstanding shares of our common stock, have entered into customary Lock-up Agreements in favor of the

representative of the underwriters pursuant to which such parties have agreed not to sell any shares of our common stock for [6][12] months after the primary offering is completed.

     We will bear the expenses of registration and all selling and other expenses, including all underwriting discounts or commissions, incurred in connection with this offering,.

     These are speculative securities. INVESTMENT IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD PURCHASE THESE SECURITIES ONLY IF YOU CAN AFFORD A COMPLETE LOSS OF YOUR INVESTMENT. SEE “RISK FACTORS” BEGINNING AT PAGE 7.

     NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

				Underwriting Discounts		Proceeds to T3 Motion,
		Price to Public		and Commissions (1)		Inc.
Per Unit
Total

     Delivery of the units will be made on or about      ,2011. We have granted the underwriters a 45-day option to purchase up to XXX additional units solely to cover over-allotments, if any.

          In connection with this offering, we have also agreed to sell to the underwriters an option to purchase up to 5.0% of the units sold for $XX. If the underwriters exercise this option, each unit may be purchased for $XX per unit (110.0% of the price of the units sold in the offering).

     The following table of contents has been designed to help you find important information contained in this prospectus. We encourage you to read the entire prospectus carefully.

CHARDAN CAPITAL MARKETS, LLC

The date of this prospectus is      , 2011

Table of Contents

Prospectus Summary			1
The Offering		9
Risk Factors			11
Special Note Regarding Forward-Looking Statements			22
Use of Proceeds			23
Determination of Offering Price			23
Capitalization			24
Dilution			25
Price Range of Common Stock			26
Description of Business			26
Legal Proceedings			37
Management			38
Director and Executive Compensation			41
Security Ownership of Certain Beneficial Owners and Management			49
Equity Compensation Plan Information			52
Certain Relationships and Related Transactions			53
Management’s Discussion and Analysis			58
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure			71
Description of Property			71
Description of Securities			72
Underwriting and Plan of Distribution			76
Interests of Named Experts and Counsel			77
Disclosure of Commission Position on Indemnification for Securities Act Liabilities			78
Where You Can Find More Information			79
Financial Information			F-1
EX-23.1

     You should rely only on the information contained in this prospectus to make your investment decision. We have not authorized anyone to provide you with different information. This prospectus may be used only where it is legal to sell these securities. You should not assume that the information in this prospectus is accurate as of any date other than the date on the front page of this prospectus. The information contained in this document may only be accurate on the date of this document.

(1)		The Company anticipates a majority of preferred share holders will convert into common stock upon the closing of this offering. As some of such holders have an anti-dilution provision which will be triggered by this offering, such share amount and price cannot be determined yet.

RISK FACTORS

     You should carefully consider the risks described below before making an investment decision. Our business could be harmed by any of these risks. The trading price of our common stock could decline due to any of these risks, and you may lose all or part of your investment. In assessing these risks, you should also refer to the other information contained in this prospectus, including our consolidated financial statements and related notes.

Risks Related to Our Company and Our Industry

Our limited operating history may not serve as an adequate basis to judge our future prospects and results of operations.

     We have a limited operating history. We developed our first personal mobility product in late 2006. Our limited operating history and the unpredictability of our industry make it difficult for investors to evaluate our business and future operating results. An investor in our securities must consider the risks, uncertainties and difficulties frequently encountered by companies in new and rapidly evolving markets. The risks and difficulties we face include challenges in accurate financial planning as a result of limited historical data and the uncertainties resulting from having had a relatively limited time period in which to implement and evaluate our business strategies as compared to older companies with longer operating histories.

     The likelihood of our success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with the formation of a new business, the commencement of operations and the competitive environment in which we intend to operate. Our ability to implement our business plan remains unproven and no assurance can be given that we will ever generate sufficient revenues to sustain our business or make a profit.

As a recently formed corporation, we have had very limited operations to date and expect to incur losses in the near future. We may require additional financing to sustain our operations and without it we may not be able to continue our operations.

     We are a newly formed corporation and, as such, we have little revenue and anticipate that we will continue to incur losses and negative cash flow for the foreseeable future. Since we recently commenced operations, we may not foresee all developments and problems that may occur and the amount of time and capital required to become profitable and cash flow positive. We may need additional funds to continue our operations, and such additional funds may not be available when required, or that such funding, if available, will be obtained on terms favorable to or affordable by us.

     To date, we have financed our operations primarily through equity and debt financing. Our ability to arrange future financing from third parties will depend upon our perceived performance and market conditions. Our inability to raise additional working capital at all or to raise it in a timely manner would negatively impact our ability to fund our operations, to generate revenues and to otherwise execute our business plan, leading to the reduction or suspension of our operations and ultimately forcing us to go out of business. Should this occur, the value of our common stock could be adversely affected.

If we are unable to continue as a going concern, our securities will have little or no value.

     Our independent registered public accounting firm has noted in its report concerning our consolidated financial statements as of December 31, 2009 and 2008 and for the years ended December 31, 2009, 2008 and 2007 that we have incurred significant operating losses and had negative cash flows from operations since inception, and at December 31, 2009 had a working capital deficit of $11.0 million an accumulated deficit of approximately $33.1 million. These factors raise substantial doubt about our ability to continue as a going concern.

     We have incurred losses from operations of $4.7 million for the nine months ended September 30, 2010 and have an accumulated deficit of $40,4 million as of September 30, 2010.

     As of September 30, 2010, we had $40,966 in cash on hand to use for working capital, regulatory filing requirements, research and development and capital requirements. As a public reporting company, we will incur legal, accounting and other costs associated with being a public company. For the nine months ended September 30, 2010, we used $3.9 million in cash for operating activities. We continue to use cash in excess of operating requirements; however, management has been and is continuing to implement its cost reduction strategy for material, production and service costs. Until management achieves its cost reduction strategy and is able to generate sales to realize the benefits of the strategy, over the next year and significantly increase cash flow from operations, the Company will require additional capital to meet its working capital requirements, debt service, research and development, capital requirements and compliance requirements. We will continue to raise additional equity and/or financing to meet our working capital requirements, including the use of the proceeds from this offering. Management believes that the achievement of our cost reduction strategy and sales strategy, will allow us to meet our working capital requirements with our cash inflows from operations. However, we cannot guarantee that we will be able to meet operating cash requirements with operating cash inflows.

     Management believes that its current sources of funds and current liquid assets will allow us to continue as a going concern through at least December 30, 2010. We will raise additional debt and/or equity capital to finance future activities through 2010 and 2011. In light of these plans, management is confident in our ability to continue as a going concern. Despite management’s confidence, our significant recurring losses to date raise substantial doubt as to our ability to continue as a going concern. We cannot assure you that we will achieve operating profits in the future. If we fail as a going concern, our shares of common stock will hold little or no value.

Adverse conditions in the global economy and disruption in financial markets could impair our revenues.

     As widely reported, financial markets in the United States, Europe, the Middle East, Latin America and Asia have been experiencing extreme disruption in recent months, including, among other things, extreme volatility in security prices, severely diminished liquidity and credit availability, rating downgrades of certain investments and declining valuations of others. These conditions have already impaired our ability to access credit markets and finance operations. There can be no assurance that there will not be a further deterioration in financial markets and confidence in major economies. We are impacted by these economic developments, both domestically and globally, in that the current tightening of credit in financial markets adversely affects the ability of our customers and suppliers to obtain financing for significant purchases and operations, and could result in a decrease in orders for our products and services. These economic conditions may negatively impact us as some of our customers defer purchasing decisions, thereby lengthening our sales cycles. In addition, certain of our customer’s budgets may be constrained and they may be unable to purchase our products at the same level. Our customer’s ability to pay for our products and services may also be impaired, which may lead to an increase in our allowance for doubtful accounts and write-offs of accounts receivable. We are unable to predict the likely duration and severity of the current disruption in financial markets and adverse economic conditions in the U.S. and other countries. Should these economic conditions result in us not meeting our revenue objectives, our operating results and financial condition could be adversely affected.

Our markets are highly competitive, and if we are unable to compete effectively, we will be adversely affected.

     The industries in which we operate include competitors who are larger, better financed and better known than we are and may compete more effectively than we can. In order to stay competitive in our industry, we must keep pace with changing technologies and customer preferences. If we are unable to differentiate our products from those of our competitors, our revenues may decline. In addition, our competitors have established relationships among themselves or with third parties to increase their ability to address customer needs. As a result, new competitors or alliances among competitors may emerge and compete more effectively than we can.

     Our failure to further refine our technology and develop and introduce new personal mobility products could render our products uncompetitive or obsolete, and reduce our sales and market share.

     The personal mobility industry is characterized by rapid increases in the diversity and complexity of technologies, products and services. We will need to invest significant financial resources in research and development to keep pace with technological advances in the personal mobility industry, evolving industry standards and changing customer requirements. However, research and development activities are inherently uncertain, and we might

encounter practical difficulties in commercializing our research results. Our significant expenditures on research and development may not reap corresponding benefits. A variety of competing personal mobility technologies that other companies may develop could prove to be more cost-effective and have better performance than our products. Therefore, our development efforts may be rendered obsolete by the technological advances of others. Our failure to further refine our technology and develop and introduce new personal mobility products could render our products uncompetitive or obsolete, and result in a decline in our market share and revenue.

We face risks associated with the marketing, distribution and sale of our personal mobility products internationally, and if we are unable to effectively manage these risks, they could impair our ability to expand our business abroad.

     We have expanded our marketing, distribution, and sales efforts to the European, Asian, and Middle Eastern markets. This exposes us to a number of risks, including:

	•		fluctuations in currency exchange rates;
	•		difficulty in engaging and retaining distributors who are knowledgeable about and, can function effectively in, overseas markets;
	•		increased costs associated with maintaining marketing efforts in various countries;
	•		difficulty and cost relating to compliance with the different commercial and legal requirements of the overseas markets in which we offer our products;
	•		inability to obtain, maintain or enforce intellectual property rights; and

Our business depends substantially on the continuing efforts of our executive officers and our ability to maintain a skilled labor force, and our business may be severely disrupted if we lose their services.

     Our future success depends substantially on the continued services of our executive officers, especially Ki Nam, our Chief Executive Officer and the Chairman of our Board of Directors. We do not maintain key man life insurance on any of our executive officers. If one or more of our executive officers are unable or unwilling to continue in their present positions, we may not be able to replace them readily, if at all. Therefore, our business may be severely disrupted, and we may incur additional expenses to recruit and retain new officers. In addition, if any of our executives joins a competitor or forms a competing company, we may lose some of our customers.

The products we sell may be used in high risk situations and could give rise to product liability, product warranty claims and other loss contingencies, which could adversely affect our business and financial results.

     The products that we manufacture are typically used in situations that may involve high levels of risk of personal injury. Failure to use our products for their intended purposes, failure to use or care for them properly, or their malfunction, or, in some limited circumstances, even correct use of our products, could result in serious bodily injury. Given this potential risk of injury, proper maintenance of our products is critical.

     While our products are rigorously tested for quality, our products nevertheless may fail to meet customer expectations from time-to-time. Also, not all defects are immediately detectible. Failures could result from faulty design or problems in manufacturing. In either case, we could incur significant costs to repair and/or replace defective products under warranty. Customers may sue us if any of our products sold to them injure the user. Liability claims could require us to spend significant time and money in litigation and pay significant damages. As a result, any of these claims, whether or not valid or successfully prosecuted, could have a substantial, adverse effect on our business and financial results. In addition, although we currently have product liability insurance, the amount of damages awarded against us in such a lawsuit may exceed the policy limits of such insurance. Further, in some cases, product redesigns and/or rework may be required to correct a defect and such occurrences could adversely impact future business with affected customers. Our business, financial condition, results of operations and liquidity could be materially and adversely affected by any unexpected significant warranty costs.

     Our prospects for sales growth and profitability will be adversely affected if we have product replacement issues, or if we otherwise fail to maintain product quality and product performance at an acceptable cost.

     We will be able to expand our net sales and to achieve, sustain and enhance profitable operations only if we succeed in maintaining the quality and performance of our products. If we should not be able to produce high-quality products at standard manufacturing rates and yields, unit costs may be higher. In recent periods, we have occasionally had to replace components of existing products. For instance we are voluntarily replacing external chargers due to the fact that the chargers could fail over time. This may adversely affect our reputation with potential customers. We have increased our warranty reserve accordingly. Because the establishment of reserves is an inherently uncertain process involving estimates of the number of future claims and the cost to settle claims, our ultimate losses may exceed our warranty reserve. Future increases to the warranty reserve would have an adverse effect on our profitability in the periods in which we make such increases. Additional product replacement issues could materially affect our business as it could increase cost of sales as a result of increased warranty service costs, reduce customer confidence on our products, reduce sales revenue, or increase product liability claims.

The failure to achieve acceptable manufacturing yields could adversely affect our business.

     We may have difficulty achieving acceptable yields in the manufacture of our products which could lead to higher costs, a loss of customers or delay in market acceptance of our products. Slight impurities or defects can cause significant difficulties, particularly in connection with the production of a new product, the adoption of a new manufacturing process or any expansion of our manufacturing capacity and related transitions. Yields below our target levels can negatively impact our gross profit.

From time to time we engage in related party transactions. There are no assurances that these transactions are fair to our company.

     From time to time we enter into transactions with related parties which include the purchase from or sale to of products and services from related parties, and advancing these related parties significant sums as prepayments for future goods or services and working capital requirements, among other transactions, including advances from related parties. We have in place policies and procedures which require the pre-approval of loans between these related parties. Notwithstanding these policies, we cannot assure you that in every instance the terms of the transactions with these various related parties are on terms as fair as we might receive from or extend to third parties. In addition, related party transactions in general have a higher potential for conflicts of interest than third-party transactions, could result in significant losses to our company and may impair investor confidence, which could adversely affect our business and our stock price.

We are dependent on a few single sourced third party manufacturers. Any interruption in our relationships with these parties may adversely affect our business.

     Most components used in our products are purchased from outside sources. Certain components are purchased from single sourced suppliers. These single source suppliers provide components used on our products and include domestic suppliers such as American Made, Performance Composites, Imperial Electric and Santa Fe Mold. These suppliers provide the frame, fiberglass body, electric motor, and various small plastic parts, respectively. The failure of any such supplier to meet its commitment on schedule could have a material adverse effect on our business, operating results and financial condition. If a sole-source supplier were to go out of business or otherwise become unable to meet its supply commitments, the process of locating and qualifying alternate sources could require up to several months, during which time our production could be delayed. Such delays could have a material adverse effect on our business, operating results and financial condition.

     Our dependence on third party suppliers for key components of our devices could delay shipment of our products and reduce our sales.

     We depend on certain domestic and foreign suppliers for the delivery of components used in the assembly of our products. Our reliance on third-party suppliers creates risks related to our potential inability to obtain an adequate

supply of components or subassemblies and reduced control over pricing and timing of delivery of components and sub-assemblies. Specifically, we depend on suppliers of batteries and battery components and other miscellaneous customer parts for our products. We also do not have long-term agreements with any of our suppliers and there is no guarantee that supply will not be interrupted. Any interruption of supply for any material components of our products could significantly delay the shipment of our products and have a material adverse effect on our revenues, profitability and financial condition.

Many of our customers have fluctuating budgets, which may cause substantial fluctuations in our results of operations.

     Customers for our products include, and may include in the future, federal, state, municipal, foreign and military, law enforcement and other governmental agencies. Government tax revenues and budgetary constraints, which fluctuate from time to time, can affect budgetary allocations for these customers. Many domestic and foreign government agencies have in the past experienced budget deficits that have led to decreased spending in defense, law enforcement and other military and security areas. Our results of operations may be subject to substantial period-to-period fluctuations because of these and other factors affecting military, law enforcement and other governmental spending. A reduction of funding for federal, state, municipal, foreign and other governmental agencies could have a material adverse effect on sales of our products and our business, financial condition, results of operations and liquidity.

Our resources may be insufficient to manage the demands imposed by our growth.

     We have rapidly expanded our operations, and this growth has placed significant demands on our management, administrative, operating and financial resources. The continued growth of our customer base and the geographic markets served can be expected to continue to place a significant strain on our resources. In addition, we cannot easily identify and hire personnel qualified both in the provision and marketing of our products. Our future performance and profitability will depend in large part on our ability to attract and retain additional management and other key personnel, and our ability to implement successful enhancements to our management, marketing and sales team and technology personnel.

Decreased demand for electric vehicles could cause our products to become obsolete or lose popularity.

     The electric vehicle industry is in its infancy and has experienced substantial change in the last few years. To date, demand for and interest in electric vehicles has grown. However, continued growth in the electric vehicle industry depends on many factors, including:

	•		continued development of product technology;
	•		the environmental consciousness of customers;
	•		the ability of electric vehicles to successfully compete with vehicles powered by internal combustion engines;
	•		widespread electricity shortages and the resultant increase in electricity prices, especially in our primary market, California, which could derail our past and present efforts to promote electric vehicles as a practical solution to vehicles which require gasoline; and
	•		whether future regulation and legislation requiring increased use of nonpolluting vehicles is enacted.

     We cannot assure you that growth in the electric vehicle industry will continue. Our business of providing personal mobility vehicles powered by electric motors may suffer if the electric vehicle industry does not grow or grows more slowly than it has in recent years or if we are unable to maintain the pace of industry demands.

The failure of certain key suppliers to provide us with components could have a severe and negative impact upon our business.

     We rely on a small group of suppliers to provide us with our custom design components for our products; some of these are located outside of the United States. If these suppliers become unwilling or unable to provide components, delays could be caused as there are a limited number of alternative suppliers who could provide them on demand. Changes in business conditions, wars, governmental changes and other factors beyond our control or which we do not presently anticipate could affect our ability to receive components from our suppliers in a timely manner. Further, it could be difficult to find replacement components if our current suppliers of custom parts fail to provide the parts needed for these products. A failure by these suppliers to provide the components could severely restrict our ability to manufacture our products and prevent us from fulfilling customer orders in a timely fashion.

Our success is dependent on protecting our intellectual property rights.

     We rely on a combination of patent, copyright, trademark and trade secret protections to protect our proprietary technology. Our success will, in part, depend on our ability to obtain trademarks and patents. We license one patent and hold three trademarks registered with the United States Patent and Trademark Office. We cannot assure you that these trademarks and patents will not be challenged, invalidated, or circumvented, or that the rights granted under those registrations will provide competitive advantages to us.

     We also rely on trade secrets and new technologies to maintain our competitive position, but we cannot be certain that others will not gain access to these trade secrets. Others may independently develop substantially equivalent proprietary information and techniques or otherwise gain access to our trade secrets.

We may be exposed to liability for infringing intellectual property rights of other companies.

     Our success will, in part, depend on our ability to operate without infringing on the proprietary rights of others. Although we have conducted searches and are not aware of any patents and trademarks which our products or their use might infringe, we cannot be certain that infringement has not or will not occur. We could incur substantial costs, in addition to the great amount of time lost, in defending any patent or trademark infringement suits or in asserting any patent or trademark rights, in a suit with another party.

Our officers and directors own a substantial portion of our outstanding common stock, which will enable them to influence many significant corporate actions and in certain circumstances may prevent a change in control that would otherwise be beneficial to our shareholders.

     Our directors and executive officers control at least 55.9% of our outstanding shares of stock that are entitled to vote on all corporate actions. In particular, our controlling stockholder, Chairman and Chief Executive Officer, Ki Nam, together with his children, owns 59.6% of the outstanding shares. Mr. Nam could have a substantial impact on matters requiring the vote of the shareholders, including the election of our directors and most of our corporate actions. This control could delay, defer, or prevent others from initiating a potential merger, takeover, or other change in our control, even if these actions would benefit our shareholders and us. This control could adversely affect the voting and other rights of our other shareholders and could depress the market price of our common stock.

     Risks Relating Ownership of Our Securities

If a public market for our common stock develops, we expect to experience volatility in the price of our common stock. This may result in substantial losses to investors if they are unable to sell their shares at or above their purchase price.

     If a significant public market for our common stock develops, we expect the market price of our common stock to fluctuate substantially for the indefinite future due to a number of factors, including:

	•		our status as a company with a limited operating history and limited revenues to date, which may make risk-averse investors more inclined to sell their shares on the market more quickly and at greater discounts than would be the case with the shares of a seasoned issuer in the event of negative news or lack of progress;
	•		announcements of technological innovations or new products by us or our competitors;

	•		the timing and development of our products;
	•		general and industry-specific economic conditions;
	•		actual or anticipated fluctuations in our operating results;
	•		our capital commitments; and
	•		the loss of any of our key management personnel.

     In addition, the financial markets have experienced extreme price and volume fluctuations. The market prices of the securities of technology companies, particularly companies like ours without consistent revenues and earnings, have been highly volatile and may continue to be highly volatile in the future, some of which may be unrelated to the operating performance of particular companies. The sale or attempted sale of a large amount of common stock into the market may also have a significant impact on the trading price of our common stock. Many of these factors are beyond our control and may decrease the market price of our common stock, regardless of our operating performance. In the past, securities class action litigation has often been brought against companies that experience volatility in the market price of their securities. Whether or not meritorious, litigation brought against us could result in substantial costs, divert management’s attention and resources and harm our financial condition and results of operations.

We do not anticipate paying any cash dividends in the foreseeable future, which may reduce your return on an investment in our common stock.

     We plan to use all of our earnings; to the extent we have earnings, to fund our operations. We do not plan to pay any cash dividends in the foreseeable future. We cannot guarantee that we will, at any time, generate sufficient surplus cash that would be available for distribution as a dividend to the holders of our common stock. Therefore, any return on your investment would derive from an increase in the price of our stock, which may or may not occur.

Substantial future sales of our common stock in the public market may depress our stock price.

     As of September 30, 2010, 48,558,462 shares of common stock, 11,502,563 shares of preferred stock (which convert into 23,005,126 shares of common stock and warrants for the purchase of 13,751,369, 120,000 and 274,774 shares of common stock at an exercise price of $0.70, $1.54 and $1.65 per share, respectively, are outstanding.

     In addition, we intend to file a registration statement on Form S-8 under the Securities Act of 1933, as amended, to register approximately 10,726,312 shares of our common stock underlying options granted or to be granted to our officers, directors, employees and consultants. These shares, if issued in accordance with these plans, will be eligible for immediate sale in the public market, subject to volume limitations. As of September 30, 2010, there were 7,086,812 options outstanding, of which 3,719,854 were vested.

     If our stockholders sell substantial amounts of common stock in the public market, or the market perceives that such sales may occur, the market price of our common stock could fall. The sale of a large number of shares could impair our ability to raise needed capital by depressing the price at which we could sell our common stock.

We may raise additional capital through a securities offering that could dilute your ownership interest and voting rights.

     Our certificate of incorporation currently authorizes our board of directors to issue up to 150,000,000 shares of common stock and 20,000,000 shares of preferred stock. As of September 30, 2010, after taking into consideration our outstanding common shares, including shares convertible from preferred stock to common stock, our board of directors will be entitled to issue up to 8,497,437 additional shares. The power of the board of directors to issue shares of common stock or warrants or options to purchase shares of our stock is generally not subject to shareholder approval.

     We require substantial working capital to fund our business. If we raise additional funds through the issuance of equity, equity-related or convertible debt securities, these securities may have rights, preferences or privileges senior to those of the holders of our common stock. The issuance of additional common stock or securities convertible into common stock by our board of directors will also have the effect of diluting the proportionate equity interest and voting power of holders of our common stock.

Our incorporation documents and Delaware law may inhibit a takeover that stockholders consider favorable and could also limit the market price of your stock, which may inhibit an attempt by our stockholders to change our direction or management.

     Our certificate of incorporation and bylaws will contain provisions that could delay or prevent a change in control of our company. Some of these provisions:

	•		authorize our board of directors to determine the rights, preferences, privileges and restrictions granted to, or imposed upon, the preferred stock and to fix the number of shares constituting any series and the designation of such series without further action by our stockholders;
	•		prohibit stockholders from calling special meetings;
	•		prohibit cumulative voting in the election of directors, which would otherwise allow less than a majority of stockholders to elect director candidates;
	•		establish advance notice requirements for submitting nominations for election to the board of directors and for proposing matters that can be acted upon by stockholders at a meeting; and
	•		prohibit stockholder action by written consent, requiring all stockholder actions to be taken at a meeting of our stockholders.

     In addition, we are governed by the provisions of Section 203 of Delaware General Corporate Law. These provisions may prohibit large stockholders, in particular those owning 15% or more of our outstanding voting stock, from merging or combining with us, which may prevent or frustrate any attempt by our stockholders to change our management or the direction in which we are heading. These and other provisions in our amended and restated certificate of incorporation and bylaws and under Delaware law could reduce the price that investors might be willing to pay for shares of our common stock in the future and result in the market price being lower than it would be without these provisions.

The Market For Our Stock Is Subject To Rules Relating To Low-Priced Stock (“Penny Stock”) Which May Limit Our Ability To Raise Capital.

     Our Common Stock is currently listed for trading in the FINRA OTC Bulletin Board Market and is subject to the “penny stock rules” adopted pursuant to Section 15(g) of the Exchange Act. In general, the penny stock rules apply to non-NASDAQ or non-national stock exchange companies whose common stock trades at less than $5.00 per share or which have tangible net worth of less than $5,000,000 ($2,000,000 if the company has been operating for three or more years). Such rules require, among other things, that brokers who trade “penny stock” on behalf of persons other than “established customers” complete certain documentation, make suitability inquiries of investors and provide investors with certain information concerning trading in the security, including a risk disclosure document, quote information, broker’s commission information and rights and remedies available to investors in penny stocks. Many brokers have decided not to trade “penny stock” because of the requirements of the penny stock rules, and as a result, the number of broker-dealers willing to act as market makers in such securities is limited.

     Despite the fact that we intend for our common stock to be listed on the AMEX prior to or simultaneous with the completion the offering, we cannot assure you that our common stock may not still be deemed as “penny stock.” The “penny stock rules,” therefore, may have an adverse impact on the market for our Common Stock and may affect our ability to raise additional capital if we decide to do so.

Management will have substantial discretion over the use of the proceeds of this Offering and may not choose to use them effectively.

     We plan to use the proceeds from this Offering as set forth in the section entitled “Use of Proceeds.” Our management will have significant flexibility in applying the net proceeds of this Offering and may apply the proceeds in ways in which you do not agree. The failure of our management to apply these funds effectively could materially harm our business.

The market price for our Common Stock may be particularly volatile given our status as a relatively unknown company with a small and thinly traded public float, limited operating history and lack of profits which could lead to wide fluctuations in our share price. The price at which you purchase the shares underlying the Units may not be indicative of the price of the Common Stock that will prevail in the trading market. You may be unable to sell your shares at or above your purchase price, which may result in substantial losses to you.

     In addition, the market price of our Common Stock could be subject to wide fluctuations in response to:

	•		quarterly variations in our revenues and operating expenses;
	•		announcements of new products or services by us;
	•		fluctuations in interest rates;
	•		significant sales of our Common Stock;
	•		the operating and stock price performance of other companies that investors may deem comparable to us; and
	•		news reports relating to trends in our markets or general economic conditions.

     The stock markets in general and the market prices for penny stock companies in particular, have experienced volatility that often has been unrelated to the operating performance of such companies. These broad market and industry fluctuations may adversely affect the price of our stock, regardless of our operating performance.

Following the effectiveness of our registration statement and listing of our securities on the NASDAQ, our shares of common stock may be thinly traded, so you may be unable to sell at or near ask prices or at all if you need to sell your shares to raise money or otherwise desire to liquidate your shares.

     We cannot predict the extent to which an active public market for its common stock will develop or be sustained. We intend to apply for listing on the NASDAQ, but cannot assure you that this listing or listing on any other exchange will ever occur. Even if our shares are listed on such exchange, we cannot assure that you will obtain sufficient liquidity in your holdings of our common stock.

     Our common shares are currently traded on the OTC Bulletin Board where they have historically been sporadically or “thinly-traded”, meaning that the number of persons interested in purchasing our common shares at or near bid prices at any given time may be relatively small or non-existent.

     This situation may be attributable to a number of factors, including the fact that we are a small company which is relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that even if we came to the attention of such persons, they tend to be risk averse and would be reluctant to follow an unproven company such as ours or purchase or recommend the purchase of our shares until such time as we became more seasoned and viable. As a consequence, there may be periods of several days, weeks or months when trading activity in our shares is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support

continuous sales without an adverse effect on share price. We cannot give you any assurance that a broader or more active public trading market for our Common Stock will develop or be sustained, or that current trading levels will be sustained or not diminish.

Our operating results may fluctuate significantly, and these fluctuations may cause our Common Stock price to fall.

     Our quarterly operating results may fluctuate significantly in the future due to a variety of factors that could affect our revenues or our expenses in any particular quarter. You should not rely on quarter-to-quarter comparisons of our results of operations as an indication of future performance. Factors that may affect our quarterly results include:

	•		market acceptance of our products and those of our competitors;
	•		our ability to attract and retain key personnel;
	•		development of new designs and technologies; and
	•		our ability to manage our anticipated growth and expansion.

Shares eligible for future sale may adversely affect the market.

     From time to time after the registration statement has been declared effective, certain of our stockholders may be eligible to sell all or some of their shares of Common Stock by means of ordinary brokerage transactions in the open market pursuant to Rule 144, promulgated under the Securities Act, subject to certain limitations. In general, pursuant to amended Rule 144, non-affiliate stockholders may sell freely after six months subject only to the current public information requirement (which disappears after one year). There are no shares of our common stock held by non-affiliates that will become 144 eligible within three months after our registration statement has been declared effective.

     Affiliates may sell after six months subject to the Rule 144 volume, manner of sale (for equity securities), current public information and notice requirements. Any substantial sale of our Common Stock pursuant to Rule 144 or pursuant to any resale prospectus (including sales by investors of securities acquired in connection with this Offering) may have a material adverse effect on the market price of our Common Stock.

Certain prior investors who purchased our securities, consisting of convertible notes, preferred stock, common stock and warrants to purchase common stock, from December 2007 through March 2010, have anti-dilution rights with respect to their shares of our common stock (including shares underlying warrants). If future issuances of our common stock trigger these anti-dilution rights, holders of our common stock would have their investments diluted.

     Certain security holders who purchased our units consisting of shares of our preferred stock, common stock and warrants to purchase shares of our common stock have anti-dilution rights, and in particular, price-based anti-dilution rights. Except for certain exceptions such as issuances relating to employee stock option exercises, in the event that we sell common stock for less than $0.50 per share or issue securities convertible into or exercisable for common stock at a conversion price or exercise price less than $0.50 per share (a “Dilutive Issuance”), then we are required to issue a number of additional shares of common stock to each unit purchaser, without additional consideration. The number of additional shares to be issued will be equal to the product of the purchaser’s subscription amount multiplied by a fraction, the numerator of which is the number of shares of common stock sold and issued at the closing of such Dilutive Issuance plus the number of shares which the aggregate offering price of the total number of shares of common stock sold and issued at the closing of such Dilutive Issuance would purchase at $0.50 per share, and the denominator of which is the number of shares of common stock issued and outstanding on the date of such Dilutive Issuance plus the number of additional shares of common stock sold and issued at the closing of such Dilutive Issuance. In this case, other holders of our common stock would be diluted to a greater

extent than they would be if the anti-dilution provision were not triggered. We anticipate that holders of the convertible note will convert such shares upon the close of this offering.

Holders of our 10% Bridge Financing have anti-dilution rights that are triggered by a disposition of our common stock at a price per share that is lower than the conversion price of such notes. These rights are not available to the holders of our common stock. If future issuances of our common stock trigger the anti-dilution rights, an investment in our common stock would be diluted to the extent such convertible notes are converted.

Holders of $3,500,000 in aggregate principal amount of our 10% Bridge Financing may convert the outstanding principal amount and accrued interest thereon into equity securities upon the closing of our next equity financing. Each “unit consists of one share of the Compny’s Series A Convertible Preferred Stock and a warrant to purchase one share of the common stock. As part of this offering, the Company anticipates that holders of the $3.5 million principal amount of convertible notes will convert such notes into an equivalent amount of shares . If all of our 10% Bridge Financing were converted into common stock at $0.50 per share, we would be required to issue an additional 7,000,000 shares. If, during the time that any of our 10% Bridge Financing are outstanding, we sell or grant any option to purchase (other than options issued to our employees, officers, directors and consultants), or sell or grant any right to reprice our securities, or otherwise dispose of or issue any common stock or common stock equivalents entitling any person to acquire shares of our common stock at a price per share that is lower than the conversion price of these notes (which, for purposes of this discussion will be designated as the “Base Conversion Price”), then the conversion price of the debentures will be reduced according to the following weighted average formula: the conversion price will be multiplied by a fraction the denominator of which will be the number of shares of common stock outstanding on the date of the issuance plus the number of additional shares of common stock offered for purchase and the numerator of which will be the number of shares of common stock outstanding on the date of such issuance plus the number of shares which the aggregate offering price of the total number of shares so offered would purchase at the conversion price. A reduction in the conversion price resulting from the foregoing would allow the holders of our 10% Bridge Financing to receive more shares of preferred stock than they would otherwise be entitled to receive. In that case, other holders of our common stock would be diluted to a greater extent than they would be if no adjustment to the conversion price were required.

We are responsible for the indemnification of our officers and directors, which could result in substantial expenditures.

     Our Bylaws provide for the indemnification of our directors, officers, employees, and agents, under certain circumstances, against attorney’s fees and other expenses incurred by them in any litigation to which they become a party arising from their association with or activities on behalf of our company. This indemnification policy could result in substantial expenditures, which we may be unable to recoup.

You will incur immediate and substantial dilution in the net tangible book value of the units you purchase, which could adversely affect the market price of our common stock.

This offering will result in a significant immediate dilution in net tangible book value to new investors purchasing Units in this offering. Accordingly, the investors will bear a great deal of the financial risk associated with our business, while effective control will remain with the principal stockholders.

Cautionary Language Regarding
Forward-Looking Statements and Industry Data

This Prospectus contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties, many of which are beyond the Company’s control. The Company’s actual results could differ materially and adversely from those anticipated in such forward-looking statements as a result of certain factors, including those set forth below and elsewhere in this Prospectus. Important factors that may cause actual results to differ from projections include:

• Adverse economic conditions;

• Inability to raise sufficient additional capital to operate T3 Motion’s business;

• Unexpected costs and operating deficits, and lower than expected sales and revenues;

• Adverse results of any legal proceedings;

• Inability to enter into acceptable relationships with one or more contract manufacturers and suppliers for the Company’s key components and the failure of such contract manufacturers to produce components of an acceptable quality on a cost-effective basis;

• The volatility of T3 Motion’s operating results and financial condition;

• Inability to attract or retain qualified senior management personnel, including sales and marketing personnel; and

• Other specific risks that may be alluded to in this Prospectus.

All statements, other than statements of historical facts, included in this Prospectus regarding the Company’s growth strategy, future operations, financial position, estimated revenue or losses, projected costs, prospects and plans and objectives of management are forward-looking statements. When used in this Prospectus, the words “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project,” “plan” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. All forward-looking statements speak only as of the date of this Prospectus. The Company undertakes no obligation to update any forward-looking statements or other information contained herein. Potential investors should not place undue reliance on these forward-looking statements. Although T3 Motion believes that its plans, intentions and expectations reflected in or suggested by the forward-looking statements in this Prospectus are reasonable, the Company cannot assure potential investors that these plans, intentions or expectations will be achieved. The Company discloses important factors that could cause the Company’s actual results to differ materially from its expectations under “Risk Factors” and elsewhere in this Prospectus. These cautionary statements qualify all forward-looking statements attributable to the Company or persons acting on its behalf.

     See “Risk Factors” for a more detailed discussion of uncertainties and risks that may have an impact on future results.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     This prospectus, including sections entitled “Prospectus Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Description of Business,” contains forward-looking statements.

     Forward-looking statements include, but are not limited to, statements about:

     These statements relate to future events or our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These risks and other factors include those listed under “Risk Factors” and elsewhere in this prospectus. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “potential,” “continue” or the negative of these terms or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We do not intend to update any of the forward-looking statements after the date of this prospectus or to conform these statements to actual results. Neither the Private Securities Litigation Reform Act of 1995 nor Section 27A of the Securities Act of 1933 provides any protection for statements made in this prospectus.

USE OF PROCEEDS

     We estimate that the net proceeds from the sale of the units by us in the offering (assuming no exercise of the Class H and Class I warrants or the underwriters’ over-allotment option), after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us, will be $XX million, assuming a public offering price of $XX per unit.

     We anticipate that we will use the net proceeds of this offering for:

	•		Tooling costs for new products;
	•		Execution of sales and marketing plan;
	•		Research and development for new products;
	•		Production of our GT3 consumer car;
	•		Working capital requirements; and
	•		Repayment of $1.0 million debt due on March 31, 2011 and repayment of a shareholder advance of $1.2 million, due on October 1, 2011

Other than the repayment of the March 31, 2011 Note, we have no definitive agreements or commitments with respect to any of the above activities. Our management may decide to change the use of the net proceeds from this offering if opportunities or needs arise. Such opportunities and needs could include payment of certain contractual obligations, the need to make increased capital or operating expenditures if we change our business plan, or payment of an unexpected liability. The actual use of the proceeds may vary significantly and will depend on a number of factors, including our future revenue and cash generated by operations and the other factors described in the section entitle “Risk Factors” appearing elsewhere in this prospectus. Accordingly, our management will have broad discretion in applying the net proceeds of this offering.

DETERMINATION OF OFFERING PRICE

The offering price of our units being offered in the offering was determined by our management after consultation with our underwriters and was based upon consideration of various factors, our history and prospects, the background of our management and current conditions in the securities markets. The price of our units in the primary offering does not bear any relationship to our assets, book value, net worth or other economic or recognized criteria of value. In no event should the offering price of our units be regarded as an indicator of any future market price of our securities.

CAPITALIZATION

     The following table sets forth our capitalization as of September 30, 2010:

	•		on an actual basis; and
	•		on a pro forma as adjusted basis to give effect to the sale of [          ] units in this offering at an assumed public offering price of $XX per unit, which is the midpoint of our expected offering range, after deducting the estimated underwriting discount and commissions and estimated offering expenses payable by us and application of net proceeds.

     You should read this table together with Management’s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and the related notes appearing elsewhere in this prospectus.

As of September 30, 2010

										Pro-Forma
		Actual				Pro Forma (2) (3)				As Adjusted (1)
Cash and Cash equivalents		$	40,966			$				$
Restricted Cash			10,000
Total			50,966
Notes Payable (2)			3,744,183
Series A Preferred stock, $0.001 par value, 20,000,000 shares authorized, 11,502,563 shares issued and outstanding. (3)		$	11,503			$				$
Common stock, $0.001 par value, 150,000,000 shares authorized 48,558,462 shares issued and outstanding.			48,559			$				$
Additional paid-incapital			27,598,677			$				$
Accumulated deficit			(40,414,711	)		$				$
Accumulated other comprehensive income			4,343			$				$
Total shareholder’s deficit			(12,751,629	)		$				$
Total capitalization		$	(9,007,446	)		$				$

DILUTION

     As of September 30, 2010, the Company had a net tangible book value of $XXXX or $(XX) per share of common stock. Net tangible book value represents the total tangible assets of the Company, less all liabilities, divided by the number of shares of common stock outstanding. Without taking into account any changes in such net tangible book value after September 30, 2010, other than to give effect to the sale by the Company of XX units of securities offered hereby, as well as the ____ shares underlying the underwriter representative’s common stock purchase option, the pro forma net tangible book value per share at September 30, 2010 would have been $__. This amount represents an immediate decrease in net tangible book value of $___ per share to the current shareholders of the Company and an immediate increase in net tangible book value of $___ per share to new investors purchasing shares in this offering as illustrated in the following table:

Public offering price per unit (1)		$
Net tangible book value per share before the offering (2)(3)		$
Decrease in net tangible book value per share to existing shareholders attributable to new investors (after deduction of the estimated underwriting discount and other offering expenses to be paid by Company)		$
Pro-forma net tangible book value per share after the offering		$
Increased value per share to new investors (determined by taking the adjusted net tangible book value after the offering and deducting the amount of cash paid by a new investor for a share of common stock)		$

     The following table sets forth, on a pro forma basis as of September 30, 2010, the number of shares of common stock purchased from the Company, the total consideration paid and the average price per share paid by the existing shareholders and by the new investors, assuming in the case of new investors a public offering price of $XX per unit, before deductions of the underwriting and other offering expenses:

Total

Consideration

Average

Shares

Amount

Price

Acquired

Percent

(in 000’s)

Percent

Per Share

Existing Shareholders

New Investors

Total

     The foregoing table does not include the impact of the exercise of the underwriter’s overallotment option.

PRICE RANGE OF COMMON STOCK

Market Information

     Our common stock has been listed on the OTCBB under the symbol “TMMM” since December 6, 2009. Prior to December 6, 2009, there was no public market for our common stock. The following table sets forth the range of high and low sales prices per share as reported on OTCBB for the periods indicated.

		High       Low
2010
Third Quarter		$	1.01 – $0.27
Second Quarter		$	1.00 – $0.25
First Quarter		$	2.00 – $0.89
2009
Fourth Quarter (from December 6, 2009)		$	2.00 – $1.25

Dividends

          We have not declared or paid any cash dividends and do not intend to pay any cash dividends in the foreseeable future. We intend to retain any future earnings for use in the operation and expansion of our business. Any future decision to pay cash dividends on our common stock will be at the discretion of our Board of Directors and will depend upon our financial condition, results of operations, capital requirements and other factors our Board of Directors may deem relevant.

DESCRIPTION OF BUSINESS

Overview

     T3 Motion, Inc. (“T3 Motion”) was incorporated in the State of Delaware on March 16, 2006. We are principally engaged in the designing, manufacturing and marketing of personal mobility vehicles powered by electric motors.

     Our initial product is the T3 Series, an electric stand-up vehicle (ESV) designed specifically for public and private security personnel that is powered by a quiet zero-gas emission electric motor. After three years of development, we delivered to market the first T3 Series vehicles in early 2007. We plan to introduce a series of product variants based on the initial T3 Series vehicle and the modularity of the sub-systems we have created.

     The T3 Series vehicle design has been highly recognized for professional-based applications. Its iconic look has garnered international acclaim such as the Innovation Award for Best Vehicle at the 2007 International Association of Chiefs of Police (IACP) Convention in New Orleans, Louisiana. Additionally, the T3 Series was honored at the International Spark Design Awards in Pasadena, California in 2007. The T3 Series has been featured on local, national and international television and print media being deployed by professionals from law enforcement and private security demonstrating the command presence coupled with the vehicle’s approachability by the public. In addition to being an effective performance-based patrol vehicle, it aids in public relations by enabling two-way conversations between the professional operator and the general public. This unique dynamic allows officers and personnel to more effectively fulfill Community-Oriented Policing (COPS) initiatives that have become prevalent since 9/11.

     The Company is headquartered in Costa Mesa, California and has a sales office in the United Kingdom. We have sales distributors in South Korea, Turkey, France, Belgium, Australia, New Zealand, Israel, Lebanon, South Africa, the Middle East and the People’s Republic of China.

Market and Industry Overview

     Personal transportation in the United States has become a necessity with law enforcement and government agencies, university campuses, airports, shopping malls, events/promotions, military/government, and industrial areas. Similar needs exist in the Middle East, Europe, Asia, and Latin America.

     Adding to the substantial market for security in the post-9/11 world, increasing awareness of global warming is creating a rapidly growing market for clean technologies. As a zero-gas emissions electric vehicle, the T3 Series is positioned to take advantage of this trend.

     In the U.S, the increase in homeland security spending since 9/11 has been substantial. The Department of Homeland Security Grant Program is scheduled to award $1.7 billion to municipalities for equipment acquisition and emergency preparedness in 2009. We have an opportunity to capture a portion of this market created by police department purchases of police cars, associated upgrades, bicycles and other security equipment purchased with funds from the U.S. Department of Homeland Security (DHS).

     Below is the list of specific markets that we believe will continue to experience growth and we intend to serve.

     Law Enforcement. As police and sheriff’s departments nationwide continue to deploy more law enforcement personnel, T3 Motion will continue to focus on serving this market. According to the U.S. Bureau of Justice, as of September 2004 there were 1,076,897 full-time state and local law enforcement personnel. This is an increase of 5.6% from 2000.

     College and University Campuses. According to the U.S. Census Bureau, Statistics Abstract of the United States: 2002 (No. 257. Higher Education-Summary: 1970 to 1999), there were more than 4,000 higher education institutions in the United States in 1999.

     High Schools. According to the National Center for Educational Statistics: 2005, there are over 18,000 public high schools in the U.S. According to the 2004 National School Resource Officers Survey, school crimes, violence and safety offenses remain significant issues affecting our education system.

     Military and Government Agencies. According to Global Research, July 2007, there are 6,000 military bases and/or military warehouses. At least 1,000 are believed to be bases and/or military installations of which 700 to 800 are located worldwide that the U.S. operates or controls. With total military personnel deployed in the U.S. and U.S. overseas territories of about 1.4 million, the need to provide security and other activities, including the need to move people within large areas is significant. The DHS devotes a significant number of personnel to border and transportation security, emergency preparedness, science and technology and information analysis and management. DHS uses T3 Series in the inspection of cargo at industrial plants and airports, including the Los Angeles International Airport and the Long Beach Port.

     Airports. According to the U.S. Department of Transportation, in 2003 there were 19,581 airports in the US. Of these, there were 5,286 public use airports, 14,295 private use airports and 628 certified airports (Certified airports serve air-carriers operations with aircraft seating more than 30 passengers). The T3 Series is used for security and by airport personnel both inside and outside the terminal buildings at airports. In addition, we anticipate the need for the T3 Series for ground crew, airline personnel and customer service staff.

     Port Security. In the post-9/11 era, according to DHS, February 2006 press release, funding for port security has increased more than 700%. DHS spent over $1.6 billion in 2005 for port security. Additionally, in 2006, the DHS allocated over $168 million for the Port Security Grant Program and, in 2007, it was over $202 million with an additional $110 million in supplemental funding.

     Private Security Companies. According to the National Association of Security Companies (NASCO) 2006 Private Security Fact Sheet, private security contracting is an approximately $13 billion industry in the U.S. with 11,000 to 15,000 companies employing 1.2 million contract security officers. Contract security officers are increasingly protecting military bases and installations across the country and around the world, and are required to be first responders to any incident. The President’s National Strategy for Homeland Security estimates that these

private security officers protect 85% of the country’s infrastructure, which, according to the NASCO, makes private security companies a top funding priority for the federal government.

     Manufacturing and Industrial Firms. According to the 2005 U.S. Census Bureau report there are 333,460 manufacturing establishments in the U.S. with 115,715 establishments that have more than 100 employees. We believe that the need for transportation of people, parts, or products within or around these establishments is an ideal application for the T3 Series. Currently we believe that maintenance and warehousing personnel use golf carts and bicycles. Most large manufacturing and industrial facilities use utility vehicles, golf carts and bicycles for transportation, maintenance and warehousing. We expect some of these vehicles could be replaced with our products.

     Shopping Malls and Parking Patrol. According to the CoStar National Research Bureau Shopping Center Database and Statistical Model 2005, there are approximately 48,000 shopping malls in the U.S. covering more than six billion square feet of space. The malls are patrolled by private security companies. In addition to malls, there are numerous parking structures throughout the U.S. that are regularly patrolled.

Our Operations

          Our principal executive offices and operations facility is located in Costa Mesa, California. Our main corporate headquarters facility located at 2990 Airway Avenue, Suite A is an approximate 34,000 square foot facility that is home to the executive staff and sales staff and is our main operational and manufacturing location. The facility is equipped with multiple production lines capable of producing up to 750 T3 vehicles per month. Located directly across the street at 2975 Airway is our 14,000 square feet warehouse and R&D center that is fully equipped with all of the necessary machines and equipment needed to design and build development products.

          We manufacture our T3 Series at our headquarters. Our raw materials are sourced from various suppliers, both national and international. Currently, our electronics and wire harness assembly manufacturing, embedded digital processing application development and electronics hardware and software development occur at our headquarters and operations center. Final assembly, testing, warehousing, quality control and shipping take place at our U.S. operations center. We are, however, developing a multi-source supply chain that we anticipate will provide a low-cost labor structure and sub-assembly infrastructure supporting final assembly in the U.S. The supply chain will include materials sourcing and subassembly operations from sources in China, South Korea and Mexico. These components will be shipped to our operations facility in Costa Mesa for final assembly, test, inspection, and shipments to our customers. We have established and will continue to expand this multiple source supplier base to will allow us to utilize both current U.S. based suppliers and newly acquired global suppliers to reduce the risks of our existing single sourced components and reduce product costs.

          Our sales and marketing is located at our headquarters and currently targets opportunities in the Western, Central and Eastern United States. The sales and marketing team is beginning to expand globally into Canada, Mexico, Australia, Europe, Asia and the Middle East. We have agreements with numerous U.S. regional distributors and manufacturing representative companies giving the distributors and manufactures representatives the exclusive rights to sell the T3 Series and CT Micro Car in specified geographic regions. Each agreement has a 30 day cancellation clause.

The T3 Motion, Inc. Product Line

T3 Series ESV

          The T3 Series is a three-wheel, front wheel drive, stand-up, electric personal mobility vehicle with a zero-gas emission electric motor. The T3 Series has hydraulic disk brakes on both rear wheels that are matched with 17-inch low profile motorcycle tires for long treadwear and demanding performance. The vehicle is equipped with an LCD control panel display and utilizes high intensity LED lighting for its vertically adjustable headlights and taillights. It also features emergency lights, as well as a siren on the law enforcement model. The T3 Series enables the operator to respond rapidly to calls with low physical exertion. The elevated riding platform allows 360 degrees visibility while the ergonomic riding position reduces fatigue. The T3 Series’ zero degree turning radius makes it highly

maneuverable. The T3 Series comes standard with a lockable storage compartment for equipment and supplies. An image of the T3 Series vehicle is shown below:

Power Modules

          The T3 Series has replaceable power modules that allow continuous vehicle operation without recharging downtime. The T3 Series offers a variety of battery technology options in its power modules. The power modules and charger can be sold separately as replacement parts.

Accessories

          Each T3 Series now features a reversible rear tires which enables customers to determine whether to set up their T3 Series in a wide stance (36” wide) or a narrow stance (32” wide), depending on their needs.

          An optional Side-mount External Storage Pack allows the operator to carry additional items on the vehicle. An optional Front-mount External Storage Case enables the T3 Series to distribute parcels, documents, and cargo in indoor and outdoor narrow space environments.

          An optional Sun Shade provides the operator protection from elements like the sun or rain.

          An optional front and rear turn indicator system is available for international deployments and domestic up-fitting opportunities.

          An optional on-board video camera system and digital video recorder is available for patrol tracking and incident response data.

          Available accessories include an external shotgun mount, a fitted vehicle cover, a parcel delivery trailer, and a multi-function trailer option.

          Additional accessories are currently being designed and field tested.

          The Company leveraged the modularity of the T3 Series system to enter the international market with the T3i Series, a scaled down version of the professional T3 Series. The T3i Series features integrated LED headlights, brakelights, running lights, and emergency lights. The speed range is 12 km/h to 25 km/h with a 175 kg cargo capacity.

Camera System

          We offer multiple CCTV and camera systems including the 360-IP DN Camera, a stand-alone 360-degree camera and DVR and the TVS-4050WK, a fully wireless IP four-camera system targeted at facilities, warehouse, business districts, and campuses. We are a certified re-seller of Immersive Media Corp.’s various security camera models. These camera systems offer the option of up to a 360 degree view of the areas patrolled. They also offer the option of GPS positioning, real-time surveillance or DVR recording options.

CT Series

          The CT Micro Car, is a low-speed four-wheel electric car. Leveraging the market penetration from the introduction of the T3 Series professional mobility vehicles, we are using existing and developed sales channels in the law enforcement, security, government, and military sectors. We are re-designing, branding, marketing and distributing the CT Micro Car to increase market share, to create additional lines of products and expand overall brand awareness through our exclusive distribution agreement with manufacturing partner CT&T. The distribution agreement, dated November 24, 2008, gives us the exclusive territories of Canada and the United States and the exclusive professional markets of all U.S. government, law enforcement and security markets. The distribution agreement has a three-year term with automatic one-year renewals unless terminated 90 days prior to the end of any term. An image of the CT Series vehicle is shown below:

GT3

The GT3 commuter vehicle is the newest product in development. The GT3 commuter vehicle is a front-wheel drive, three-wheeled electric vehicle targeted for general consumer personal transportation applications. The GT3 commuter vehicle is expected to be released for the market in 2011.

Future Products

     We plan to introduce a series of product variants based on the initial T3 Series and CT Series vehicles and the modularity of the sub-systems we have created. While both the initial T3 Series and the CT Series vehicles are targeted at law enforcement, security and enterprise markets, we intend to expand our base of T3 Series and CT Series vehicle variants by utilizing the modularity of the sub-systems to configure vehicles for specific market uses such as delivery services, personnel transport and personal mobility. As with all new development and products, we cannot guarantee that the products will make it to market and if they are released to market, whether they will be successful.

The GT3 commuter vehicle is the newest product in development. The GT3 commuter vehicle is a front-wheel drive, three-wheeled electric vehicle targeted for general consumer personal transportation applications. The GT3 commuter vehicle is expected to be released for the market in 2011.

     We also plan to leverage the modularity of the T3 Series system to enter the international market with the T3i Series, a scaled down version of the professional T3 Series.

Revenue from Products

     The following table presents the sales of our products, identified both by revenue amount and percentage of total revenues, for the nine months ended September 30, 2010 and 2009 and the years ended December 31, 2009, 2008 and 2007.

		Nine Months Ended September 30,																Year Ended December 31,
		2010								2009								2009								2008								2007
						Percentage								Percentage								Percentage								Percentage								Percentage
						of Total								of Total								of Total								of Total								of Total
Product		Revenues				Revenues				Revenues				Revenues				Revenues				Revenues				Revenues				Revenues				Revenues				Revenues
T3 Series			2,732,856				75.38	%			2,634,362				77.28	%			3,570,629				76.89	%			6,516,718				85.87	%			1,486,157				81.56	%
Accessories			455,690				12.57	%			466,904				13.70	%			620,707				13.37	%			956,809				12.61	%			317,210				17.4	%
Parts			245,549				6.77	%			129,687				3.80	%			199,704				4.30	%			22,246				0.29	%			13,512				0.74	%
Freight			182,622				5.04	%			170,144				4.99	%			241,640				5.20	%			86,617				1.14	%			4,890				0.27	%
Warranty			8,814				0.24	%			7,729				0.23	%			11,342				0.24	%			6,875				0.09	%			500				0.02	%
			3,625,531				100.00	%			3,408,826				100.00	%			4,644,022				100.00	%			7,589,265				100.00	%			1,822,269				100.00	%

Research and Development

     We place great emphasis on product research and development (“R&D”). For the nine months ended September 30, 2010 and 2009 and for the years ended December 31, 2009, 2008 and 2007, we spent $1,069,226, $963,119, $1,395,309, $1,376,226 and $1,243,430, respectively, on R&D for development of products such as the CT-Series, the GT3 and to ensure that the T3 Series personal mobility vehicle was properly designed to be an extremely effective and useful tool for the public safety and private security market. In addition, we will continue to refine and optimize all aspects of the vehicle design to maintain its high standards of vehicle performance, cost effectiveness and to continue to meet the needs of our customers.

Growth Strategies

          The core value of our brand and mission is to become the leader in enabling efficient, clean, personal, professional mobility electric stand-up vehicles and to continue providing products that are economical, functional, safe, dependable and meet the needs of the professional end user. We believe we have an experienced management team with extensive experience in product design, development, innovation, operations, sales and marketing to execute the following growth strategies:

	•		Increase our presence in law enforcement. We intend to continue to build on our reputation as the ESV of choice by aggressively marketing towards the law enforcement community through trade shows and direct and indirect sales. We have identified the key accounts within our core market segments of law enforcement, government and security/private industry that will achieve our primary sales goals and objectives, including driving key regional market penetration, product recognition and brand presence.
	•		Capitalize on broader security opportunities. Our success in the law enforcement market has had a viral effect and led to significant inbound demand for the T3 Series from other security markets, which hold equal, if not greater, potential. These markets include airports, events/promotions, government/military, private

			security, shopping malls and university campuses. Based on current market conditions, we believe we may generate greater interest in these markets with potentially new orders over the next 12 to 24 months.
	•		International. In 2009 the T3i (The International model of the T3) was introduced into key international markets. These consisted of countries in the Middle East (including the United Arab Emirates, Qatar, Kuwait and Israel), as well as Mexico, Canada, and, to a limited extent, Europe. In 2010 and 2011 we hope to significantly increase our level of activity in the GCC region, specifically Kuwait, Bahrain, The Kingdom of Saudi Arabia, Lebanon and Jordan, as well as other key international markets including South America, Australia and New Zealand. We also intend to increase our footprint in Europe and continue to deploy the CT Micro Car. In general, we intend to leverage our existing customer base to introduce and deploy the CT Micro Car.
	•		Expand the T3 Series product line to address broader enterprise markets. We intend to leverage the modularity of our sub-systems to configure additional vehicles that address the needs of the broader enterprise markets. These needs include delivery services, maintenance, personnel transportation and personal mobility.
	•		Leverage brand into the consumer market. As we extend our presence in the law enforcement and security markets and continue to develop our brand name and reputation, we intend to leverage our strong brand to enter the consumer market for personal transportation. We have a robust product roadmap of consumer-focused vehicles that will utilize the same low-cost, high-quality component sourcing and sub-assembly.
			In order to meet our growth objectives, we are taking the following measures:
	•		Building a strong brand in our strategic market. We have built brand awareness within our strategic market of law enforcement. As a result, we sold and shipped over 1,600 vehicles since 2007 and have garnered interest from numerous customers for larger orders. Our brand strength and value is evidenced by increasing numbers of repeat orders by law enforcement customers and the large volume orders from new customers. We have received interest from new emerging markets such as emergency medical services, the correctional industry, utility/maintenance applications and high-profile/high-visibility national security accounts. Through this strategy, management believes we will see continued success in both our core strategic market (nationally and internationally) and emerging markets.
	•		Grow our partnering relationships with key security companies. Currently, we have built relationships with national private security providers. In order to see continued success, we have marketed the T3 Series and CT Micro Car as an integrated security solution. This internal sales strategy has positioned our T3 Series as a attractive solution due to its economical and environmentally-friendly benefits. In particular, it has led to additional trials of our T3 Series products with our potential customers. This strategy has lead to additional market penetration within the markets for property management, entertainment/sporting venues, retail department store chains and high-profile venues.
	•		Return on Investment (ROI). We estimate our product demonstrates an approximate cost savings of $17,000 to $24,000 per year over gas powered vehicles. We intend to leverage the ROI to further our market penetration and expand into emerging markets.
	•		Expand our distributors and manufacturing representatives nationwide. We have positioned domestic sales offices and distributors in five geographic locations in the United States. Included in our nationwide expansion plans, we are developing service solutions for each geographic region to maintain our level of customer service. Our sales force has a comprehensive qualification process that identified the top performing representative firms. Subsequently, we have put under contract the leading representative companies and distribution companies nationwide.
	•		Expand our marketing and sales efforts globally. We have positioned global sales distribution offices in

eight geographic locations (US, Korea, China, Middle East, Australia, South America, South Africa and Europe). Included in and distributors our global expansion plans, we are developing service solutions for each geographic region to maintain our level of customer service.

	•		Expand our products. We intend to continue adding custom and standard accessories to our T3 Series such as firearm/rifle mounts, trailer, saddle bag mounts, maintenance racks, license plate identification system, vehicle camera, helmets, clothing, first aid kits, emergency response kits, mirrors, lighting, etc.
	•		Service. During 2009, we rolled out our third party service program, whereby our customers were able to take their vehicles to any of the authorized service locations for warranty and non-warranty service. The program provides an efficient and cost effective way for customers to keep their vehicles running in their optimum condition.

Marketing and Distribution

          We market and sell our products through our direct sales force located at our headquarters in Costa Mesa, California. In 2007, our marketing and sales targets were focused primarily on opportunities in the Western, Central and Eastern United States. In 2008, we began expanding our markets globally into Europe, Asia and the Middle East. We have agreements with numerous U.S. regional distributors and manufacturing representative companies, adding substantially to our direct sales force. We also attend and provide exhibits at two trade shows per geographic market per year and advertise quarterly in trade journals. In 2009 and 2010, we continued our global expansion into the Middle East, Europe and Australia, by developing distribution channels.

          Early high profile and priority sales are made by initiating field trials that typically utilized one or two vehicles and lasts from one to two weeks. These field trials usually lead to initial product orders within 60 to 90 days. We benefit from sales on both regional outreach and a referral basis, which has a significant multiplicative effect on sales. Additionally, private security organizations are now placing orders based on the endorsement of the law enforcement community. Typical initial orders have ranged in size from a single unit to ten units and, for larger customers, have often led to larger subsequent orders within three to six months. Our marketing efforts and the interest our products have generated have led to numerous media pieces on a regional, national and international scale, ranging from news articles to television spots on television networks such as ABC, CBS, Fox, NBC, CNN, the BBC, Sky News and other local television stations.

          We value our customer input as we are a customer-driven company. Entering into any negotiation we follow a fundamental approach using the following core customer interests:

	•		We evaluate the available budget from the customer, building the value of the product rather than price. For example, one packaged T3 Series is able to fulfill the client’s needs for a multi-shift deployment related to competing products.
	•		Return on Investment (ROI). Our products have demonstrated significant savings over gas powered vehicles and allow the end user greater mobility and work efficiencies.
	•		We maintain a manufacturing process that holds lead times to a 4-6 weeks timeframe.
	•		We have an in-field swappable power system that enables our clients to operate vehicles without downtime for charging. The sustainable engineering and design was specifically tailored for the professional end user in law enforcement and private security.
	•		Our vehicle has demonstrated that the iconic look and command presence has a crime deterrent ability.
	•		The T3 Series allows the user greater mobility to maneuver through crowds and tight areas effectively increasing the patrol area and granting the user job efficiencies.

          We have a procedure for establishing distribution channels for each geographic region. Among other things, distributors should have sales experience to law enforcement agencies and security providers. Each distributor must have service capability for the T3 Series.

Sources and Availability of Raw Materials; Principal Suppliers

          Today over 70% of our T3 Series suppliers are local suppliers who provide products and services to low volume early stage development companies. As the vehicle design has become stable and sales volumes have increased we have begun our transition to incorporate a global supply chain. We have made significant progress in establishing relationships with suppliers who service volume production stage companies. In addition, investments are being made in production tooling that will yield consistent high quality and lower cost parts designed to our specifications. We plan to implement our multi-source supply chain strategy in working directly with established factories within the automotive and motorcycle industry. The supply chain will include materials sourcing and subassembly operations from sources in China, South Korea and Mexico. These components will be shipped to our operations facility in Costa Mesa, California for final assembly, test, inspection, and shipments to our customers. We will continue to expand this multiple source supplier base to allow us to utilize both current U.S. based suppliers and newly acquired global suppliers to reduce the risks of our existing single sourced components and reduce product costs.

          We do not manufacture the CT Micro Car. Fully-built versions are delivered to us from the developer, CT&T. We outfit the CT Micro Car with our power management and battery technology.

Operating and Manufacturing Strategy

          Our management and engineering teams have extensive experience working with off-shore manufacturers. They have become acutely aware of the advantages of partnering with reputable suppliers to immediately leverage manufacturing practices at minimal cost. Our staff continuously seeks out new qualified suppliers and evaluates them for the maximum benefit that can be quickly realized. All suppliers must have a well established history of supplying quality products within their respective industries so that we can immediately benefit from multiple manufacturing locations with a trained and experienced technical work force, state of the art facilities and knowledge of all aspects of supply chain management, operational execution, global logistics and reverse logistics.

Competition

          To management’s knowledge, there are at least eight leading companies engaged in personal mobility vehicle design, manufacturing and marketing including, without limitation, Segway, California Motors-Ride Vehicles and Gorilla Vehicles.

          Some of our competitors are larger than we are and may have significantly greater name recognition and financial, sales and marketing, technical, manufacturing and other resources. These competitors may also be able to respond rapidly to new or emerging technologies and changes in customer requirements or devote greater resources to the development, promotion and sale of their products. Our competitors may enter our existing or future markets with products that may provide additional features or that may be introduced earlier than our products.

          We attempt to differentiate ourselves from our competitors by working to provide superior customer service and developing products with appealing functions targeted to our core markets of professional end users in law enforcement, private security, and government.

     We value our customer input as we are a customer-driven company. Entering into any negotiation we follow a fundamental approach using one of three core customer interests:

•

We evaluate the available budget from the customer, building the value of the product rather than price. For example, one packaged T3 Series is able to fulfill the client’s needs for a multi-shift deployment related to competing products.

•

We maintain a manufacturing process that holds lead times to a 4-6 weeks timeframe.

•

We have an in-field swappable power system that enables our clients to operate vehicles without downtime for charging. The sustainable engineering and design was specifically tailored for the professional end user in law enforcement and private security.

Intellectual Properties and Licenses

     The following table describes the intellectual property owned by the Company:

Type		Name		Issued by		Description
Trademark				United State Patent and Trademark Office		Logo, brand name used on our products
Trademark				United State Patent and Trademark Office		Logo, brand name used on our products
Trademark		“ENABLING PERSONAL MOBILITY”		United State Patent and Trademark Office		Logo, brand name used on our products

     We also have a patent license agreement from Evolutionary Electric Vehicles to us granting a perpetual, fully paid, transferable exclusive license to make, have made, use, improve and sell an over 10 Horsepower Brushless DC Motor for Traction (US Patent #4,882,524) with respect to products in the world. This patent covers a motor technology that we plan on fully developing and using in our products. Currently, we do not use the motors covered by this patent; however, this patented technology will be utilized in future motors that we intend to use on future products. It is still too early in the developmental phase to determine when the motor technology and products will be available for the market.

          On March 21, 2008, we filed a United States Patent Application for Batteries and Battery Monitoring and Charging System. The intellectual property covered in this multi-claim patent is our proprietary power management system that is currently used on all T3 Series products.

          On March 31, 2008, we purchased a license to resell data in the Immersive Media Corp. mapping database. We were granted the right to map and, in partnership with Immersive Media Corp., to produce and distribute the mapped content of South Korea with the opportunity to continue into Asia Pacific. We anticipated that Asia Pacific would be an emerging market for this technology, as the geographic area is advanced in their requirements for viewing live, interactive data. We will be paid a licensing fee for the usage of any data that it has mapped and will have the opportunity to add to the content and will be compensated for any usage of the content that has been added to the Immersive Media Corp. database. On March 16, 2009, we revised the terms of the agreement to revise the start of the two-year license to begin upon the completion and approval of the post-production data. The revision includes automatic one-year renewals unless either party cancels within 60 days of the end of the contract. During 2009, we wrote off the remaining $625,000 value of the license due to management’s decision not to incur the costs to map the data.

          On September 17, 2008, we filed a United States Patent Application for the Battery Powered Vehicle Control Systems and Methods. The intellectual property covered in this multi-claim patent is our proprietary control system that is currently used on all T3 Series products.

          On July 27, 2009, we filed a United States Patent Application for Dual Tires on a Single Wheel (Provisional). The intellectual property covered in this patent offers enhanced stability, reduces rolling and aerodynamic resistance and increases rider safety.

          On September 30, 2009, we filed a United States Patent Application for Vehicle Hood, Fenders, and Bumper (Design). Our unique design showcases custom built parts that are task specific and visually appealing.

          On December 7, 2009, we filed a United States Patent Application for Rechargeable Battery Systems and Methods (Provisional). The claim covers a battery charging management system that we will deploy in our electric CT-Series and GT3 vehicle in the future. While utilizing modular technology was already used in the T3 Series vehicle , this new battery and charger system will provide more efficiency and no downtime.

Government Approvals and Regulation

          On September 17, 2008, T3 Motion completed and passed its third party lab testing to obtain its CE certification for the T3i Series product, battery, and charging system. CE is the governing regulatory body and standard for electrical products meant to be exported to the European Union, Africa, Australia, Middle East and other foreign countries.

	•		The T3i Series product has passed EMC testing for EN6100-6-1 and EN61000-6-3
	•		Batteries and chargers were found to be technically compliant with the EN55022, EN61000-3-2, EN61000-3-3, and EN55024 requirements.
	•		In 2009, the Electric Vehicle 3-Wheel and Charger has passed EMC testing for EN60950-1:2006 (Information Technology Equipment Safety Standards) as well as EN6100-6-1 and EN61000-6-3 (European Standards).

On July 28, 2009, we received our GSA license number, GS-07F-0403V

Current Customers

     Our marketing focus includes locations that have large areas to patrol such as law enforcement, airports, hospitals, universities, security companies, property management companies and commercial retail companies.

Principal Executive Offices

     Our principal executive office is located at 2990 Airway Avenue, Suite A, Costa Mesa, California 92626 and our telephone number is (714) 619-3600. Our website is www.T3motion.com. You should not consider the information contained on our website to be part of this prospectus or in deciding whether to purchase shares of our common stock.

LEGAL PROCEEDINGS

With the exception of the following, we know of no material, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding or pending litigation. We are also unaware of any proceedings in which any of our directors, officers, or affiliates, or any registered or beneficial holder of more than 5% of our voting securities, or any associate of such persons, is an adverse party or has a material interest adverse to our Company.

     Preproduction Plastics, Inc. v. T3 Motion., Inc. Ki Nam and Jason Kim (Orange County Superior Court Case No. 30.2009-00125358): On June 30, 2009, Preproduction Plastics, Inc. (“Plaintiff”) filed suit in Orange County Superior Court, alleging causes of actions against T3 Motion, Inc., Ki Nam, the Company’s CEO, and Jason Kim, the Company’s former COO, (“Defendants”) for breach of contract, conspiracy, fraud and common counts, arising out of a purchase order allegedly executed between Plaintiff and T3 Motion, Inc. On August 24, 2009, Defendants filed a Demurrer to the Complaint. Prior to the hearing on the Demurrer, Plaintiff filed a First Amended Complaint against Defendants for breach of contract, fraud and common counts, seeking compensatory damages of $470,599, attorney’s fees, punitive damages, interest and costs. On October 27, 2009, Defendants filed a Demurrer, challenging various causes of action in the First Amended Complaint. The Court overruled the Demurrer on

December 4, 2009. On December 21, 2009, Defendants filed an answer to the First Amended Complaint, and trial was set for July 30, 2010. On or about July 29, 2010, the case was settled in its entirety. T3 agreed to pay compensatory damages, attorneys’ fees and costs totaling $493,468, through monthly payments of $50,000 each, with 6% interest accruing from the date of the settlement. Periodic payments are expected to be made through May 2011. The first payment of $50,000 was made on August 3, 2010 and payments are continuing to be made. At September 30, 2010, the Company recorded the entire settlement amount as a note payable in its condensed consolidated balance sheet.

MANAGEMENT

     The following table sets forth the names and ages of all of our directors and executive officers as of September 30, 2010. Also provided herein are a brief description of the business experience of each director, executive officer and significant employee during the past five years and an indication of directorships held by each director in other companies subject to the reporting requirements under the Federal securities laws. All of the directors will serve until the next annual meeting of stockholders and until their successors are elected and qualified, or until their earlier death, retirement, resignation or removal.

     There are no family relationships among directors or executive officers. Within the past five years, our directors and executive officers have not been (i) involved in any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time, (ii) convicted of any criminal proceeding, (iii) been permanently or temporarily enjoined, barred, suspended or otherwise limited from involvement in any type of business, securities or banking activities, or (iv) convicted of violating a federal or state securities or commodities law.

Name		Age		Positions Held:
Ki Nam		50		Chief Executive Officer and Chairman
Kelly J. Anderson		43		Executive Vice President, Chief Financial Officer, President
Noel Chewrobrier		46		Vice President International Sales
Dave Fusco		60		Vice President Domestic Sales
David Snowden		66		Director
Steven Healy		49		Director
Mary S. Schott		49		Director
Rob Thompson		34		Director

Biographical Information

     Ki Nam, Chief Executive Officer has served as Chief Executive Officer of T3 Motion since March 16, 2006. Mr. Nam founded Paradigm Wireless Company in 1999, a supplier of quality wireless equipment to the telecom industry, and Aircept founded in 2000, a leading developer, manufacturer, and service provider in the Global Positioning System (GPS) marketplace. In 2001, Mr. Nam founded Evolutionary Electric Vehicles (EEV) to provide high performance motor-controller packages to the emerging hybrid and electric vehicle market. Prior to founding his own companies, Mr. Nam worked at Powerwave Technologies, Inc. (Nasdaq: PWAV), where he helped guide the company to number five in Business Week’s list of Hot Growth Companies in 2000.

     Kelly J. Anderson, has been the President since April 2010 and Executive Vice President, Chief Financial Officer since March 2008 and was appointed director in January 2009. From 2006 until 2008, Ms. Anderson was Vice President at Experian, a leading credit report agency. From 2004 until 2006, Ms. Anderson was Chief Accounting Officer for TripleNet Properties, G REIT, Inc., T REIT, Inc., NNN 2002 Value Fund, LLC, and Chief Financial

Officer of NNN 2003 Value Fund, LLC and A REIT, Inc., all of which were real estate investment funds managed by TripleNet Properties. From 1996 to 2004, Ms. Anderson held senior financial positions with The First American Corp (NYSE: FAF) a Fortune 500 title insurance company.

     Noel Chewrobrier has been Vice President of International sales, since 2007. Over the past 15 years Noel has held various senior executive sales management positions at various technology companies located in the UK and in the US.

     David Fusco, was named Vice President, Domestic Sales, on October 1, 2010. Over the past 25 years David has held senior executive sales management positions at Texas Instruments, Compaq Computer, and Hewlett-Packard. In 2006 David founded Andal Holdings, LLC, and provided sales and management consulting services to a variety of companies. David holds a Bachelor of Science degree from Miami University in Oxford, OH.

     David Snowden, Director, has been the Chief of Police of Beverly Hills for the past seven years. He has over 40 years of professional experience including holding positions as Chief of Police for Beverly Hills (current), Costa Mesa (1986-2003), and Baldwin Park (1980-1986). Chief Snowden has held numerous Presidential positions including Police Chief’s Department of the League of Cities (1993), Orange County Chief’s and Sheriff’s Association (1990) and was Chairman of the Airbourne Law Enforcement (ABLE). Chief Snowden was inducted to the Costa Mesa Hall of Fame in 2003 and was voted top 103 most influential persons on the Orange Coast for 12 years running.

     Steven Healy, Director, has been the Director of Public Safety at Princeton University since 2003, and was the President of the International Association of Campus Law Enforcement Administrators (IACLEA) until June 2007. He has served as a member of the IACLEA Government Relations Committee for the past 10 years and is active with issues regarding the Clery Act. Chief Healy was recently appointed by the governor of New Jersey to serve on the state’s Campus Security Task Force. Prior to his position at Princeton University, Mr. Healy was the Chief of Police at Wellesley College in Wellesley, MA. He also served as Director of Operations at the Department of Public Safety at Syracuse University. During his tenure at Wellesley College, Chief Healy was the IACLEA North Atlantic Regional Director and President of the Massachusetts Association of Campus Law Enforcement Administrators.

     Mary S. Schott, Director, has over 25 years experience in the accounting finance functions with extensive experience in finance and accounting compliance and systems including Sox applications. Ms. Schott has been the Chief Financial Officer of San Manuel Band of Serrano Mission Indians since 2008. A CPA and MBA, Ms. Schott served as Chief Accounting Officer of First American Title Insurance Company, a division of First American Corporation (NYSE:FAF) for three years and held various finance and accounting functions for the previous 17 years at First American. Ms. Schott was the President and Treasurer of the First American Credit Union for eight years.

Rob Thomson, Director, has been a Director at Vision Capital Advisors, LLC since 2007, a New York based private equity manager, where he oversees the firm’s growth equity investments in consumer retail, industrials, and homeland defense and security companies. Vision Capital Advisors LLC is the manager of two funds that hold debt and equity securities of the Registrant — Vision Opportunity Master Fund, Ltd. and Vision Capital Advantage Funds LP. At Vision, Mr. Thomson manages investment opportunities for the funds and works closely with its portfolio companies in executing their growth plans. He currently sits on the Board of Directors for Juma Technology Corp., a converged network integrator and software developer based in New York that trades on the OTC Bulletin Board (OTCBB: JUMT) and Microblend Technologies, Inc., a private company that is a developer of automatic paint creation systems for retailers. From 2005 to 2007, Mr. Thomson was the Managing Director of The Arkin Group, LLC in charge of operations, financial management and growth strategies for this international business intelligence firm. Mr. Thomson has an MBA from the Harvard Business School and a BA from Haverford College. He has studied Chinese language and history at Nankai University in China and Tunghai University in Taiwan. Mr. Thomson is also a term member at the Council on Foreign Relations.

Compensation Committee Interlocks and Insider Participation

     No interlocking relationship exists between our board of directors and the board of directors or compensation committee of any other company, nor has any interlocking relationship existed in the past.

Involvement in Certain Legal Proceedings

     None of our directors or executive officers has, during the past five years:

(a)

Has had a petition under the federal bankruptcy laws or any state insolvency law filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer at or within two years before the time of such filing;

(b)

Been convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);

(c)

Been the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from, or otherwise limiting, the following activities:

i.

Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;

ii.

Engaging in any type of business practice; or

iii.

Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of federal or state securities laws or federal commodities laws;

(d)

Been the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in paragraph I(i) above, or to be associated with persons engaged in any such activity;

(e)

Been found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated; or

(f)

Been found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated.

Code of Ethics

     We have not adopted a code of ethics, but we plan on adopting a code of ethics that applies to all directors, officers, and employees, including our Chief Executive Officer and Chief Financial Officer, and members of the board of directors in the near future.

Material Changes to the Procedures by which Security Holders May Recommend Nominees to the Board of Directors

     There have been no material changes to the procedures by which security holders may recommend nominees to the Board of Directors.

Audit Committee; Audit Committee Financial Expert

     Our Board of Directors approved the charter for an audit committee of the Board on January 16, 2009, and formed such committee on February 20, 2009. The members of our audit committee are Mary S. Schott (chairperson) and David Snowden. The Board of Directors has determined that Ms. Schott is an audit committee financial expert as defined by SEC rules, and she is an independent member of the Board as defined by the SEC and the NASDAQ.

DIRECTOR AND EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

     The following Compensation Discussion and Analysis describes the material elements of compensation for our executive officers identified under the “Executive Compensation — Summary Compensation Table” (the “Named Executive Officers”). As more fully described below, the Compensation Committee of our Board (the “Compensation Committee”) reviews and makes all decisions for our executive compensation program, including: establishing salaries and reviewing benefit programs for the Chief Executive Officer (“CEO”) and each of our other Named Executive Officers; reviewing, approving, recommending and administering our annual incentive compensation and stock option plans for employees and other compensation plans; and advising our Board of Directors and making recommendations with respect to plans that require Board approval. Additionally, the Compensation Committee reviews and coordinates annually with the Nominating/Corporate Governance Committee of our Board of Directors with respect to the compensation of our directors.

Compensation Committee

Committee Members and Independence

     Our Board of Directors approved the charter for a Compensation Committee of the Board on January 16, 2009, and formed such committee on February 20, 2009. The members of our Compensation Committee are Mary S. Schott (chairperson) and Steven Healy, both of whom are independent members of the Board as defined by the SEC and the NASDAQ.

Role of the Compensation Committee in Establishing Compensation

     The Compensation Committee establishes and maintains our executive compensation program through internal evaluations of performance, consultation with various executive compensation consultants and analysis of compensation practices in industries where we compete for experienced senior management. The Compensation Committee reviews our compensation programs and philosophy regularly, particularly in connection with its evaluation and approval of changes in the compensation structure for a given year. Since the Compensation Committee was not formed until after 2008, items were approved by written consent of the entire Board during 2008 regarding Board matters.

Executive Compensation Program

     Our executive compensation program is designed to attract, retain, incentivize and reward talented senior management who can contribute to our growth and success and thereby build value for our stockholders over the long-term. We believe that an effective executive compensation program is critical to our long-term success. By having an executive compensation program that is competitive with the marketplace and focused on driving sustained superior performance, we believe we can align the interests of our executive officers with the interests of shareholders and reward our executive officers for successfully improving shareholder returns. We have developed compensation programs with the following objectives:

•

attract and retain talented senior management to ensure our future success; and

•

structure a compensation program that appropriately rewards our executive officers for their skills and contributions to our company based on competitive market practice.

     The elements of our executive compensation program are as follows:

•

Base salary;

•

Annual incentive compensation (discretionary bonuses);

	•		Equity-based awards;
	•		Perquisites; and

•

Other benefits.

     Base Salary. Base salaries provide a fixed form of compensation designed to reward our executive officer’s core competence in his or her role. The Compensation Committee determines base salaries by taking into consideration such factors as competitive industry salaries; the nature of the position; the contribution and experience of the officers; and the length of service. The CEO makes salary recommendations for executive officers other than him and reviews such recommendations with the Compensation Committee.

     Annual Incentive Compensation. Discretionary annual incentive compensation is provided to incentivize our executive officers, in any particular year, to pursue particular objectives that the Compensation Committee believes are consistent with the overall goals and long-term strategic direction that the T3 Board has set for our company.

     Equity Compensation. On May 15, 2007, the Board of Directors adopted the 2007 Stock Incentive Plan (the “2007 Plan”) effective August 15, 2007. The purpose of the 2007 Plan was to promote the interests of us and our shareholders by enabling selected key employees to participate in our long-term growth by receiving the opportunity to acquire shares of our common stock and to provide for additional compensation based on appreciation of our common stock. The 2007 Plan provides for the grant of stock options to key employees, directors and consultants, including the executive officers who provide services to the Company or any of its parents or subsidiaries. Under the 2007 Plan, stock options will vest over a specified period of time (typically four years) contingent solely upon the awardees’ continued employment with us. The 2007 Plan includes certain forfeiture provisions upon an awardees’ separation from service with us. The Compensation Committee determines whether to grant options and the exercise price of the options granted. The Committee has broad discretion in determining the terms, restrictions and conditions of each award granted under the 2007 Plan and no option may be exercisable after ten years from the date of grant. All option awards granted under the 2007 Plan will have an exercise price equal to the fair market value of our common stock on the date of grant. Fair market value is defined under the 2007 Plan to be the closing market price of a share of our common stock on the date of grant or if no market price is available, the amount as determined by the Board of Directors subject to confirmation by an outside appraiser. The Compensation Committee retains the discretion to make awards at any time in connection with the initial hiring of a new employee, for retention purposes, or otherwise. We do not have any program, plan or practice to time annual or ad hoc grants of stock options or other equity-based awards in coordination with the release of material non-public information or otherwise. Any or all administrative functions may be delegated by the Board to a committee of the Board. The 2007 Plan provides that in the event of a merger of the Company with or into another corporation or of a “change in control” of the Company, including the sale of all or substantially all of our assets, and certain other events, the Board of Directors may, in its discretion, provide for the assumption or substitution of, or adjustment to, each outstanding award and accelerate the vesting of options.

     The 2007 Plan will terminate on the earlier of (i) May 15, 2017, (ii) the date on which all 7,450,000 shares available for issuance under the 2007 Plan is issued, or (iii) the termination of all outstanding options in connection with a merger with or into another corporation or a “change in control” of the Company.

     The Board of Directors may generally amend or terminate the 2007 Plan as determined to be advisable. No such amendment or modification, however, may adversely affect the rights and obligations with respect to options or unvested stock issuances at the time outstanding under the 2007 Plan unless the optionee or the participant consents

to such amendment or modification. Also, certain amendments may require shareholder approval pursuant to applicable laws and regulations.

     The above-referenced stock option grants were issued without registration in reliance upon the exemption afforded by Section 4(2) and Rule 701 of the Act based on certain representations made to us by the recipients.

     The 2007 Plan may be amended or terminated by the Board, at any time. However, an amendment that would impair the rights of a recipient of any outstanding award will not be valid with respect to such award without the recipient’s consent. A total of 7,450,000 shares of our common stock are authorized for issuance under the 2007 Plan. As of December 31, 2009, there were 6,033,188 options granted under the 2007 Plan.

     Perquisites. We provide perquisites to our executive officers that we believe are reasonable and consistent with the perquisites that would be available to them at companies with whom we compete for experienced senior management. Perquisites include automobile allowances.

     Other Benefits. Other benefits to the executive officers include a 401(k) plan. We maintain a 401(k) plan for our employees, including our NEOs, because we wish to encourage our employees to save some percentage of their cash compensation, through voluntary deferrals, for their eventual retirement. We do not offer employer matching with our 401(k) plan.

     Executive Compensation

     The following summary compensation table indicates the cash and non-cash compensation earned during the years ended December 31, 2009, 2008 and 2007 by our Chief Executive Officer (principal executive officer), (ii) our Chief Financial Officer (principal financial officer), (iii) the three most highly compensated executive officers other than our CEO and CFO who were serving as executive officers at the end of our last completed fiscal year, whose total compensation exceeded $100,000 during such fiscal year ends, and (iv) up to two additional individuals for whom disclosure would have been provided but for the fact that the individual was not serving as an executive officer at the end of our last completed fiscal year, whose total compensation exceeded $100,000 during such fiscal year ends.

Executive Compensation — Summary Compensation Table:

														Stock				Option				All Other
						Salary				Bonus				Awards				Awards				Compensation				Total
Name and Principal Position		Year				($)(1)				($)				($)				($)(1)				($)(2)				($)
Ki Nam,			2009				150,000				—				—				—				—				150,000
Chief Executive Officer			2008				150,000				—				—				—				—				150,000
and Chairman(3)			2007				—				—				—				990,000				37,000				1,027,000
Kelly J. Anderson,			2009				175,000				—				—				—				—				175,000
Executive Vice President, President			2008				131,923				—				—				452,000				—				583,923
Chief Financial Officer(4)
Jason Kim (5)			2009				170,000				—				—				—				—				170,000
Chief Operations Officer			2008				166,076				—				—				—				—				166,076
			2007				156,025				—				—				980,000				—				1,136,025

Employment Agreements

     Ki Nam

The Company entered into a written employment agreement with Mr. Ki Nam on August 13, 2010 in which it agreed to employ Mr. Nam during the term hereof as its Chief Executive Officer. Mr. Nam’s term of employment shall continue until December 30, 2011. The agreement shall automatically renew, annually, upon the terms and conditions set forth herein unless terminated by either party by written notice 60 days prior to the expiration of the then term.

For the period of one year commencing on January 31, 2010, the Company shall pay Mr. Nam a base salary of $190,000 per annum. During his employment and any renewal or extension period thereafter, the Mr. Nam shall be entitled to receive, on March 15 of each calendar year, an annual bonus based upon an approved budget by the Company’s board of directors and/or its compensation committee.

If the Board determines that the Company does not have sufficient cash available to make the above described cash obligations, the Board shall have the right to make such payments in stock, but at no time shall the cash payment due under the cash obligation fall below one third of the payment obligation. Mr. Nam shall be eligible to participate in any compensation plan or program (401(k) plan and stock option plan) maintained by the Company in which other executives or employees of the Company participate, on similar terms. The Company shall provide to Mr. Nam and his family, during the employment with coverage under all employee medical, dental and vision benefit programs, plans or practices adopted by the Company and made available to all employees of the Company. Mr. Nam shall be entitled to four (4) weeks paid vacation in each calendar year (but no more than ten 10 consecutive business days at any given time).

The Company may terminate Mr. Nam’s employment at any time for any reason. If Mr. Nam’s employment is terminated by the Company other than for Cause (as defined in such agreement), Mr. Nam shall receive a severance payment equal to twelve (12) months’ base salary and twelve (12) months’ benefits, and any earned and/or accrued bonus, as in effect immediately prior to such termination, payable in accordance with the ordinary payroll practices of the Company, but not less frequently than semi-monthly following such termination of employment. In the event that Mr. Nam’s employment is terminated (i) by the Company for Cause; (ii) by Mr. Nam on a voluntary basis; (iii) as a result of Mr. Nam’s permanent disability; or (iv) by Mr. Nam’s death, he or his estate shall only be entitled to receive base salary and bonuses already earned and accrued through the last day of his employment.

In the event of termination by Mr. Nam’s death or permanent disability, all such benefits identified under the employment agreement shall be maintained and in effect for twelve (12) additional months by the Company. Any and all such unvested benefits (i.e. 401(k), restricted stock or stock options) shall immediately vest.

If Mr.Nam’s employment with the Company is terminated by the Company (other than upon the expiration of the Employment terms, for Cause, or by reason of disability, or upon Mr. Nam’s death) at any time within ninety (90) days before, or within twelve (12) months after, a Change in Control of the Company (as defined in such agreement), or if Mr. Nam’s employment with the Company is terminated by him for good reason (as defined in such agreement) within six (6) months after a Change in Control, or if Mr. Nam’s employment with the Company is terminated by Mr. Nam for any reason, including without Good Reason, during the period commencing six (6) months after a Change in Control and ending twelve (12) months after a Change in Control, then the Company shall pay to Mr. Nam: (i) any accrued, unpaid base salary payable as in effect on the date of termination, (ii) any unreimbursed business expenses and (iii) a severance benefit, in a lump sum cash payment, in an amount equal to: (A) twice Mr.Nam’s annual rate of base salary, as in effect as of the date of termination, plus two times Mr.Nam’s target bonus for the fiscal year of the Company in which the date of termination occurs.

In the event Mr.Nam is entitled to the severance benefits, each stock option exercisable for shares of Company common stock granted under the Company’s stock incentive plan that is held by Mr.Nam, if then outstanding, shall become immediately vested and exercisable with respect to all of the shares of Company common stock subject thereto on the date of termination and shall be exercisable in accordance with the provisions of the Company’s stock incentive plan and option agreement pursuant to which such option was granted. In addition, in the event Mr.Nam is entitled to severance benefits, a restricted stock award and restricted shares of the Company common stock granted under the Company’s stock incentive plan that is held by Mr.Nam that is subject to a forfeiture, reacquisition or repurchase option held by the Company shall become fully vested, nonforfeitable and no longer subject to reacquisition or repurchase by the Company or other restrictions on the date of termination.

Mr.Nam shall not, without the prior written consent of the Company, use or make accessible to any other person, any confidential information pertaining to the business or affairs of the Company, except (i) while employed by the Company, in the business of and for the benefit of the Company, or (ii) when required to do so by applicable law.

Mr.Nam hereby covenants that, during the period commencing on the date thereof and ending on the two (2) year anniversary of the date of Mr.Nam’s termination date, he and his affiliates shall not directly or indirectly, through any others person, (i) employ, solicit or induce any individual who is, or was at any time during the one (1) year period prior to the termination date, an employee or consultant of the Company, (ii) cause such individual to terminate or refrain from renewing or extending his or his employment by or consulting relationship with the Company, or (iii) cause such individual to become employed by or enter into a consulting relationship with the Company and its affiliates or any other individual, person or entity.

Mr.Nam and his affiliates shall not solicit, persuade or induce any customer to terminate, reduce or refrain from renewing or extending its contractual or other relationship with the Company in regard to the purchase of products or services, performed, manufactured, marketed or sold by the Company or any other person. Mr.Nam and his affiliates shall not solicit, persuade or induce any supplier to terminate, reduce or refrain from renewing or extending his, his or its contractual or other relationship with the Company. During the term of his employment, the Executive shall not engage or assist others to engage in a competing business.

Kelly Anderson

The Company entered into a written employment agreement with Ms. Kelly Anderson (“Executive”) on April 17, 2010 in which it agreed to employ Executive during the term hereof as its Chief Financial Officer. Executive’s term of employment shall continue until December 30, 2011. The Agreement shall automatically renew, annually, upon the terms and conditions set forth herein unless terminated by either party by written notice 60 days prior to the expiration of the then term.

For the period of one year commencing on April 30, 2010, the Company shall pay Executive a base salary of $190,000 per annum. During her employment and any renewal or extension period thereafter, the Executive shall be

entitled to receive, on March 15 of each calendar year, an annual bonus based upon an approved budget by the Company’s Board of Directors and/or its Compensation Committee.

If Board determines that the Company does not have sufficient cash available to make the above described cash obligations, the Board shall have the right to make such payments in stock, but at no time shall the cash payment due under the cash obligation fall below one third of the payment obligation.

Executive shall be eligible to participate in any Compensation Plan or Program (401(k) Plan and Stock Option Plan) maintained by the Company in which other Executives or employees of the Company participate, on similar terms.

The Company shall provide to the Executive and her family, during the employment with coverage under all employee medical, dental and vision benefit programs, plans or practices adopted by the Company and made available to all employees of the Company. The Executive shall be entitled to four (4) weeks paid vacation in each calendar year (but no more than ten “10” consecutive business days at any given time).

The Company may terminate Executive’s employment at any time for any reason. If Executive’s employment is terminated by the Company other than for Cause (as defined in such agreement), Executive shall receive a severance payment equal to six (6) months’ Base Salary and six (6) months’ benefits, and any earned and/or accrued Bonus, as in effect immediately prior to such termination, payable in accordance with the ordinary payroll practices of the Company, but not less frequently than semi-monthly following such termination of employment.

In the event that Executive’s employment is terminated (i) by the Company for Cause; (ii) by the Executive on a voluntary basis; (iii) as a result of the Executive’s Permanent Disability; or (iv) by the Executive’s death, then Executive or her Estate shall only be entitled to receive Base Salary and Bonuses already earned and accrued through the Termination Date.

In the event of termination by the Executive’s death or Permanent Disability, all such benefits identified herein shall be maintained and in effect for six (6) additional months by the Company. Any and all such unvested benefits (i.e. 401(k), restricted stock or stock options) shall immediately vest.

If Executive’s employment with the Company is terminated by the Company (other than upon the expiration of the Employment terms, for Cause, or by reason of Disability, or upon Executive’s death) at any time within ninety (90) days before, or within twelve (12) months after, a Change in Control, or if the Executive’s employment with the Company is terminated by the Executive for Good Reason (as defined in the Employment Agreement) within six (6) months after a change in control, or if the Executive’s employment with the Company is terminated by the Executive for any reason, including without Good Reason, during the period commencing six (6) months after a Change in Control and ending twelve (12) months after a Change in Control, then the Company shall pay to the Executive: (i) any accrued, unpaid base salary payable as in effect on the Date of Termination, (ii) any unreimbursed business expenses and (iii) a severance benefit, in a lump sum cash payment, in an amount equal to: (A) the Executive’s annual rate of base salary, as in effect as of the Date of Termination, plus the Executive’s Target Bonus for the fiscal year of the Company in which the Date of Termination occurs.

In the event the Executive is entitled to the severance benefits, each stock option exercisable for shares of Company Common Stock granted under the Company’s stock incentive plan that is held by the Executive, if then outstanding, shall become immediately vested and exercisable with respect to all of the shares of Company Common Stock subject thereto on the Date of Termination and shall be exercisable in accordance with the provisions of the Company’s stock incentive plan and option agreement pursuant to which such option was granted. In addition, in the event the Executive is entitled to severance benefits, a restricted stock award and restricted shares of the Company Common Stock granted under the Company’s stock incentive plan that is held by the Executive that is subject to a forfeiture, reacquisition or repurchase option held by the Company shall become fully vested, nonforfeitable and no longer subject to reacquisition or repurchase by the Company or other restrictions on the Date of Termination. The Executive shall not, without the prior written consent of the Company, use or make accessible to any other Person, any Confidential Information pertaining to the business or affairs of the Company, except (i) while employed by the Company, in the business of and for the benefit of the Company, or (ii) when required to do so by applicable law.

The Executive hereby covenants that, during the period commencing on the date hereof and ending on the two (2) year anniversary of the Termination Date (the “Restricted Period”), the Executive and her affiliates shall not directly or indirectly, through any other Person, (i) employ, solicit or induce any individual who is, or was at any time during the one (1) year period prior to the Termination Date, an employee or consultant of the Company, (ii) cause such individual to terminate or refrain from renewing or extending her or her employment by or consulting relationship with the Company, or (iii) cause such individual to become employed by or enter into a consulting relationship with the Company and its affiliates or any other individual, Person or entity.

The Executive and her affiliates shall not solicit, persuade or induce any customer to terminate, reduce or refrain from renewing or extending its contractual or other relationship with the Company in regard to the purchase of products or services, performed, manufactured, marketed or sold by the Company or any other Person. The Executive and her affiliates shall not solicit, persuade or induce any supplier to terminate, reduce or refrain from renewing or extending her, her or its contractual or other relationship with the Company. During the term of her employment, the Executive shall not engage or assist others to engage in a competing business.

     Other than such arrangements described above, we have no other formal employment agreements with any of our executive officers, nor any compensatory plans or arrangements resulting from the resignation, retirement or any other termination of any of our executive officers, from a change-in-control, or from a change in any executive officer’s responsibilities following a change-in-control.

     Plan-Based Awards

     The following table sets forth certain information with respect to grants of plan-based awards made to the Named Executive Officers under our equity incentive plans.

																														All Other
																														Stock				All Other
																														Awards:				Option				Exercise
						Estimated Future Payouts												Estimated Future Payouts												Number				Awards:				or Base				Grant Date
						Under Non-Equity Incentive												Under Equity Incentive												of Shares				Number of				Price of				Fair Value
						Plan Awards												Plan Awards												of Stock				Securities				Option				of Option
						Threshold				Target				Maximum				Threshold				Target				Maximum				or Units				Underlying				Awards				Awards
Name		Grant Date				($)				($)				($)				(#)				(#)				(#)				(#)				Options (#)				($/Sh)				($/Sh)(2)
Ki Nam			12/10/2007				—				—				—				—				—				—								1,000,000			$	0.77			$	990,000
Kelly J.			3/17/2008				—				—				—				—				—				—								200,000			$	0.60			$	192,000
Anderson(1)			11/13/2008																																200,000			$	1.40			$	260,000
Jason Kim(3)			12/10/2007				—				—				—				—				—				—								1,000,000			$	0.60			$	980,000

     The following table summarizes the amount of our executive officers’ equity-based compensation outstanding at the fiscal year ended December 31, 2009 :

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

Option Awards

Stock Awards

Equity

Incentive

Equity

Equity

Plan Awards:

Incentive Plan

Incentive

Market or

Awards:

Market

Plan Awards:

Payout Value

Number of

Number of

Number of

Number

Value of

Number of

of Unearned

Securities

Securities

Securities

of Shares

Shares or

Unearned

Shares, Units

Underlying

Underlying

Underlying

or Units of

Units of

Shares, Units

or Other

Unexercised

Unexercised

Unexercised

Option

Option

Stock that

Stock that

or Other

Rights that

Options (#)

Options (#)

Unearned

Exercise

Expiration

Have Not

Have Not

Rights that

Have Not

Name

Exercisable

Unexercisable

Options (#)

Price ($)

Date

Vested (#)

Vested ($)

Have Not Vested (#)

Vested ($)

Ki Nam

937,500

62,500

0.77

12/10/2017

Kelly J. Anderson(1)

87,500

112,500

0.60

3/17/2018

54,167

145,833

1.40

11/13/2018

Jason Kim

854,167

145,833

0.60

12/10/2017

Option Exercises and Stock Vested

     The following table sets forth certain information regarding exercises of stock options and stock vested held by the Named Executive Officers during the year ended December 31, 2009 [please update]:

Option Exercises and Stock Vested

Option Awards

Stock Awards

Number of Shares

Number of Shares

Acquired

Value Realized

Acquired

Value Realized

on Exercise

on Exercise

on Vesting

on Vesting

Name

(#)

($)

(#)

($)

Ki Nam

—

$

—

—

$

—

Kelly J. Anderson(1)

—

—

—

—

Director Compensation

     The following table reflects all compensation awarded to, earned by or paid to the directors below for the year ended December 31, 2009. The persons listed below received the following compensation in exchange for their services as members of the Board of Directors of the Company for the year ended December 31, 2009. Ki Nam, our Chief Executive Officer, received no additional compensation as a director of the Company.

																		Pension
														Non-				Value and
		Fees												Equity				Nonqualified
		Earned												Incentive				Deferred
		or Paid in				Stock								Plan				Compensation				All Other
		Cash				Awards				Options				Compensation				Earnings				Compensation				Total
Name		($)				($)				($)(2)				($)				($)				($)				($)
Ki Nam			—				—					(1)												(1)			—
David Snowden			20,000				—				—																20,000
Steven Healy			20,000				—				—																20,000
Mary Schott			20,000								61,000																81,000

Securities Authorized for Issuance under Equity Compensation Plans or Individual Compensation Arrangements

     Please see the section titled “Securities Authorized for Issuance under Equity Compensation Plans” under Item 5 above.

Security Ownership of Certain Beneficial Owners and Management

     The following table sets forth information as to each person who is known to us to be the beneficial owner of more than 5% of our outstanding common stock and Series A Preferred Stock and as to the security and percentage ownership of each executive officer and director of the Company and all officers and directors of the Company as a group as of December 1, 2010.

     We have determined beneficial ownership in accordance with the rules of the Securities and Exchange Commission. Except as otherwise indicated, we believe that the beneficial owners listed below, based on the information furnished by these owners, have sole investment and voting power with respect to the securities indicated as beneficially owned by them, subject to applicable community property laws.

     Unless otherwise indicated, the address of each beneficial owner listed below is 2990 Airway Ave., Building A., Costa Mesa, California 92626.

										Number of				Percentage of
		Number of				Percent of				Shares of				Shares of
		Shares of				Shares of				Series A				Series A
		Common Stock				Common Stock				Preferred Stock				Preferred Stock
		Beneficially				Beneficially				Beneficially				Beneficially
Name of Beneficial Owner and Address		Owned(1)				Owned(1)(2)				Owned				Owned(13)
Executive Officers and/or Directors:
Ki Nam			33,237,464				61.9	%(3)			976,865				8.5	%
Kelly Anderson			233,333				*	(4)			—				—
David Snowden			46,876				*	(5)			—				—
Steven Healy			42,608				*	(6)			—				—
Mary S. Schott			50,000				*	(7)			—				—
Robert Thomson			33,105,000				42.6	%(8)			9,370,698				81.5	%(14)
5% Stockholders:
Immersive Media Corp.			4,465,017				8.7	%(9)			—				—
Vision Opportunity Master Fund, Ltd.			28,381,165				38.4	%(10)			7,451,765				64.8	%
Total Force International Limited			8,000,000				14.1	%(11)			—				—
Vision Capital Advantage Fund			4,723,835				9.0	%(15)			1,918,933				16.7	%
All Executive Officers and Directors as a Group (7 persons)			66,715,380				80.0	%(12)			10,347,563				90.0	%

EQUITY COMPENSATION PLAN INFORMATION

     The following table sets forth, as of December 31, 2009, certain information related to our compensation plans under which shares of our common stock are authorized for issuance.

Number of Securities

Weighted-Average

Remaining Available

Exercise Price of

for Future Issuance

Number of Securities to be

Outstanding

Under Equity

Issued Upon Exercise of

Options,

Compensation Plans

Outstanding Options,

Warrants and

(Excluding Securities

Warrants and Rights

Rights

Reflected in Column (a))

Plan Category

(a)

(b)

(c)

Equity compensation plans approved by stockholders

6,033,188

$

0.77

1,416,812

Equity compensation plans not approved by stockholders

10,746,143

$

0.87

—

Total

16,779,331

1,416,812

2007 Stock Option/Stock Issuance Plan

The 2007 Stock Option/Stock Issuance Plan (the “Option Plan”) became effective on August, 2007, the effective date the Board of Directors of T3 Motion approved the Option Plan. The maximum number of shares of Common Stock that may be issued over the term of the Option Plan is 7,450,000 shares.

Awards under the Option Plan may be granted to any of the T3 Motion’s employees, non-employee directors of T3 Motion or any of its parents or subsidiaries, and consultants and other independent advisors who provide services to T3 Motion or any of its parents or subsidiaries. Awards may consist of stock options (both incentive stock options and non-statutory stock options) and stock awards. An incentive stock option may be granted under the Option Plan only to a person who, at the time of the grant, is an employee of T3 Motion or a parent or subsidiary of T3 Motion.

The Option Plan will be administered by T3 Motion’s Board of Directors, with full power to authorize the issuance of shares of the T3 Motion’s Common Stock and to grant options to purchase shares of T3 Motion’s Common Stock. The administrator has the power to determine the terms of the awards, including the exercise price, the number of shares subject to each award, and the exercisability of the awards. Any or all administrative functions, however, may be delegated by the Board to a committee of the Board.

The Option Plan provides that in the event of a merger of T3 Motion with or into another corporation or of a “change in control” of T3 Motion, including the sale of all or substantially all of T3 Motion’s assets, and certain other events, the Board of Directors may, in its discretion, provide for the assumption or substitution of, or adjustment to, each outstanding award and accelerate the vesting of options.

The Option Plan will terminate on the earlier of (i) May 15, 2017, (ii) the date on which all 7,450,000 shares

available for issuance under the Option Plan is issued, or (iii) the termination of all outstanding options in connection with a merger with or into another corporation or a “change in control” of T3 Motion.

The Board of Directors may generally amend or terminate the Option Plan as determined to be advisable. No such amendment or modification, however, may adversely affect the rights and obligations with respect to options or unvested stock issuances at the time outstanding under the Option Plan unless the optionee or the participant consents to such amendment or modification. Also, certain amendments may require shareholder approval pursuant to applicable laws and regulations.

Warrants

     From time to time, we issue warrants to purchase shares of the Company’s common stock to investors, note holders and to non-employees for services rendered or to be rendered in the future. Such warrants are issued outside of the Plan.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Transactions with Related Parties

     The following table reflects the activity of the related party transactions as of the respective periods.

Accounts Receivable

     As of September 30, 2010, December 31, 2009 and December 31, 2008, the Company has receivables of $35,722, $28,902 and $28,902, respectively, due from Graphion Technology USA LLC (“Graphion”) related to consulting services rendered and fixed assets sold to them. During the nine months ended September 30, 2010, the Company sold fixed assets for $6,820 to Graphion. Graphion is wholly owned by the Company’s Chief Executive Officer and is under common ownership. The amounts due are non-interest bearing and due upon demand.

     As of September 30, 2010, December 31, 2009 and December 31, 2008, there were outstanding related party receivables of $10,670, $6,756 and $4,346, respectively, which primarily relate to receivables due from Mr. Nam for rent at the Company’s operating facility.

Prepaid Expenses

     As of September 30, 2010, December 31, 2009 and December 31, 2008, there was $0, $0 and $120,000, respectively, of prepaid inventory from Graphion.

Related Party Payables

     The Company purchases batteries and research and development parts from Graphion. For the nine months ended September 30, 2010 and 2009, purchases were $100,000 and $520,278, respectively. During the years ended December 31, 2009, 2008 and 2007, the Company purchased $622,589, $635,749 and $0, respectively, of parts and had an outstanding accounts payable balance of $0, $104,931 and $120,749 at September 30, 2010, December 31, 2009 and December 31, 2008, respectively.

     As of September 30, 2010, December 31, 2009 and December 31, 2008, the Company had related party payable balances of $0, $0 and $2,034,734, respectively. The 2008 related party payable balance was comprised of $1,536,206 due Albert Lin, CEO of Sooner Capital, principal of Maddog and a Director of Immersive, in addition to $498,528 in advances from Mr. Nam for the Company’s operating requirements.

     On February 20, 2009, the Company entered into a settlement agreement with Mr. Lin whereby Mr. Lin released the Company from its obligations to issue certain securities upon the occurrence of certain events, under the agreement dated December 30, 2007, in exchange for the Company issuing 931,034 shares of common stock at $1.65 per share totaling $1,536,206 for investor relations services performed. The Company recorded the value of the shares in related party payables at December 31, 2008. The Company issued the shares on February 20, 2009.

Intangible Assets

     On March 31, 2008, the Company paid $1,000,000 to Immersive, one of the Company’s shareholders, to purchase a GeoImmersive License Agreement giving the Company the right to resell data in the Immersive mapping database. The Company recorded $375,000 of amortization expense.

On March 16, 2009, the Company revised the terms of the agreement to revise the start of the two year license to begin upon the completion and approval of the post-production data. The revision includes automatic one-year renewals unless either party cancels within 60 days of the end of the contract. Upon the execution of the revision, the Company ceased amortizing the license and will test annually for impairment until the post-production of the data is complete. At December 31, 2009, management performed its annual review to assess potential impairment and deemed the intangible asset to be fully impaired, as management has decided to allocate the resources required to map the data elsewhere. As a result, the remaining value, of $625,000, was fully amortized as of December 31, 2009.

Notes Payable

Immersive Note

     On December 31, 2007, the Company issued a 12% secured promissory note in the principal amount of $2,000,000 to Immersive due on December 31, 2008. The note is secured by all of the Company’s assets. On March 31, 2008, the Company repaid $1,000,000 of the note. In addition, the Company granted 697,639 of warrants exercisable at $1.08 per share of common stock. The warrants are immediately exercisable. The Company recorded a debt discount of $485,897 related to the fair value of the warrants, which was calculated using the Black-Scholes Merton option pricing model. The debt discount was amortized to interest expense over the original term of the promissory note. Amortization of the debt discount was $485,897 for the year ended December 31, 2008.

     On December 19, 2008, the Company amended the terms of the note with Immersive to extend the maturity date of the outstanding balance of $1,000,000 from December 31, 2008 to March 31, 2010. In addition, in the event that the Company receives (i) $10,000,000 or more in a private placement financing or (ii) $15,000,000 or more in equity financing at any time after the date of the amendment and prior to March 31, 2010, the note shall become immediately due and payable. Pursuant to the terms of the amended promissory note, during the pendency and prior to the closing of an equity offering, Immersive will have the option to convert the outstanding and unpaid principal and accrued interest into units of the Company’s equity at $1.65 per unit, subject to adjustment.

     In December 2009, the Company issued 2,000,000 shares of its Series A Convertible Preferred Stock in connection with an equity offering. As a result of the December 2009 equity offering, the Company recorded the fair value of the conversion feature of $1,802 as a debt discount and will amortize such amount to interest expense over the remaining term of the promissory note. Amortization of the debt discount was not significant for the period ended December 31, 2009. The Company recorded the corresponding amount as a derivative liability and any change in fair value of the conversion feature will be recorded through earnings at each reporting date. The change in fair value of the conversion feature was not significant for the period ended December 31, 2009.

     As of September 30, 2010, December 31, 2009 and December 31, 2008, the related party note payable balance, net of discount, due Immersive was $797,784, $958,735 and $1,000,000, respectively.

     In conjunction with the amendment, the Company also agreed to issue contingent warrants for up to 250,000 shares of common stock, $0.001 par value per share, originally at $2.00 per share, for extending the note. When the Company authorizes and issues the preferred stock, the exercise price will be adjusted pursuant to the terms of the warrant agreement. Immersive received a warrant to purchase 50,000 shares since the note was not repaid by March 31, 2009. For every month that the note remains outstanding thereafter, Immersive shall receive an additional warrant for 16,667 shares. As of December 31, 2009, the Company issued 200,000 of these warrants and recorded a debt discount of $141,663 and amortized approximately $99,126 of the discount to interest expense during the year ended December 31, 2009. As a result of the December 2009 equity offering, the exercise price of the warrants was adjusted to $0.70 per share. During the three months ended March 31, 2010, the Company issued 50,000 warrants under the agreement. The Company recorded a debt discount of $15,274 during the three months ended March 31, 2010 and a total debt discount of $155,938 based on the estimated fair value of the 250,000

warrants issued, and amortized approximately $56,539 and $56,274 of the discount to interest expense during the nine months ended September 30, 2010 and 2009, respectively. As a result of the December 2009 equity offering, the exercise price of the warrants was adjusted to $0.70 per share.

     The various amendments of the note resulted in terms that were substantially different from the terms of the original note. As a result, the modification was treated as an extinguishment of debt during the year ended December 31, 2008. There was no gain or loss recognized in connection with the extinguishment.

     As of March 31, 2010, the debt discount related to the fair value of the warrants issued and the derivative liability related to the conversion feature were fully amortized. On March 31, 2010, Immersive agreed to extend the note to April 30, 2010. As consideration for extending the note, the Company agreed to exchange Immersive’s Class A warrants to purchase up to 697,639 shares of the Company’s common stock at an exercise price of $1.08 per share and its Class D warrants to purchase up to 250,000 shares of the Company’s common stock at an exercise price of $2.00 per share, for Class G Warrants to purchase up to 697,639 and 250,000 shares of the Company’s common stock, respectively, each with an exercise price of $0.70 per share. The Company recorded a debt discount and derivative liability of $1,898 based on the incremental increase in the estimated fair value of the re-pricing of the 250,000 warrants. The Company recorded an additional debt discount and derivative liability in the amount of $216,811 based on the estimated fair value of the 697,639 warrants issued. The total debt discount was amortized in April 2010.

     The note and accrued interest were not repaid in full by April 30, 2010. As a result, per the agreement, the maturity date was extended to March 31, 2011 and the Company issued Class G Warrants to purchase up to 1,040,000 shares of the Company’s common stock at an exercise price of $0.70 per share. The interest rate compounded annually was amended to 15.0%. The Company recorded interest expense of $102,500 for the nine months ended September 30, 2010 and recorded accrued interest expense of $102,500 as of September 30, 2010. The terms of the Class G Warrants are substantially similar to prior Class G warrants issued by the Company. The Company recorded a debt discount of $329,120 related to the fair value of the warrants issued. Amortization of the debt discount was for the nine months ended September 30, 2010, respectively.

Vision Opportunity Master Fund, Ltd. Bridge Financing

     On December 30, 2009, The Company sold $3,500,000 in debentures and warrants to Vision Opportunity Master Fund, Ltd. (“Vision”) through a private placement pursuant to a Securities Purchase Agreement (the “Purchase Agreement”). The Company issued to Vision, 10% Secured Convertible Debentures (“Debentures”), with an aggregate principal value of $3,500,000.

     The Debentures accrue interest on the unpaid principal balance at a rate equal to 10% per annum. The maturity date is December 30, 2010. At any time after the 240th calendar day following the issue date, the Debentures are convertible into “units” of Company securities at a conversion price of $1.00 per unit, subject to adjustment. Each “unit” consists of one share of the Company’s Series A Convertible Preferred Stock and a warrant to purchase one share of the Company’s common stock. As a result of the 240 ^th day passing the Company recorded an additional debt discount and derivative liability in the amount of $275,676 for the nine months ended September 30, 2010. The Company may redeem the Debentures in whole or part at any time after September 30, 2010 for cash in an amount equal to 120% of the principal amount plus accrued and unpaid interest and certain other amounts due in respect of the Debenture. Interest on the Debentures is payable in cash on the maturity date or, if sooner, upon conversion or redemption of the Debentures. In the event of default under the terms of the Debentures, the interest rate increases to 15% per annum. The Company recorded interest expense of $265,000 for the nine months ended September 30, 2010 and had accrued interest of $265,000 as of September 30, 2010.

     The Purchase Agreement provides that during the 18 months following December 30, 2009, if the Company or its wholly-owned subsidiary, T3 Motion, Ltd., a company incorporated under the laws of the United Kingdom (the “Subsidiary”), issue common stock, common stock equivalents for cash consideration, indebtedness, or a combination of such securities in a subsequent financing (the “Subsequent Financing”), Vision may participate in such Subsequent Financing in up to an amount equal to Vision’s then percentage ownership of the Company’s common stock.

     The Purchase Agreement also provides that from December 30, 2009 to the date that the Debentures are no longer outstanding, if the Company effects a Subsequent Financing, Vision may elect, in its sole discretion, to exchange some or all of the Debentures then held by Vision for any securities issued in a Subsequent Financing on a “$1.00 for $1.00” basis (the “Exchange”); provided, however, that the securities issued in a Subsequent Financing will be irrevocably convertible, exercisable, exchangeable, or resettable (or any other similar feature) based on the price equal to the lesser of (i) the conversion price, exercise price, exchange price, or reset price (or such similar price) in such Subsequent Financing and (ii) $1.00 per share of common stock. Vision is obligated to elect the Exchange on a $0.90 per $1.00 basis (not a $1.00 for $1.00 basis) if certain conditions regarding the Subsequent financing and other matters are met.

     Also pursuant to the Purchase Agreement, Vision received Series G Common Stock Purchase Warrants (the “Warrants”). Pursuant to the terms of Warrants, Vision is entitled to purchase up to an aggregate of 3,500,000 shares of the Company’s common stock at an exercise price of $0.70 per share, subject to adjustment. The Warrants have a term of five years after the issue date of December 30, 2009.

     The debt discount was allocated between the warrants and the conversion feature of $1,077,652 and $1,549,481, respectively, for the year ended December 31, 2009. The discount is being amortized over the term of the Debentures. The Company amortized $1,950,506 for the nine months ended September 30, 2010. The remaining unamortized warrant and beneficial conversion feature values are recorded as a discount on the Debentures in the accompanying condensed consolidated balance sheets.

     During the nine months ended September 30, 2009, the Company amortized $1,363,848 of interest expense related to a debt discount on a different note to Vision that was ultimately exchanged for shares of the Company’s Preferred Stock.

     The Subsidiary entered into a Subsidiary Guarantee (“Subsidiary Guarantee”) for the Company’s benefit to guarantee to Vision the obligations due under the Debentures. The Company and the Subsidiary also entered into a Security Agreement (“Security Agreement”) with Vision, under which the Company and the Subsidiary granted to Vision a security interest in certain of the Company’s and the Subsidiary’s property to secure the prompt payment, performance, and discharge in full all obligations under the Debentures and the Subsidiary Guarantee.

     On December 30, 2009, the Company also entered into a Securities Exchange Agreement (the “Exchange Agreement”) with Vision and Vision Capital Advantage Fund, L.P. (“VCAF” and, together with Vision, the “Vision Parties”). Pursuant to the Exchange Agreement, the Company issued to the Vision Parties an aggregate of 9,370,698 shares of Preferred Stock. 3,055,000 shares of Preferred Stock were issued in exchange for the delivery and cancellation of 10% Secured Convertible Debentures previously issued by us to the Vision Parties in the principal amount of $2,200,000 (issued December 30, 2008) and $600,000 (issued May 28, 2009) plus accrued interest of $255,000 in conjunction with the issuance of Series A Preferred Stock, the Company issued Class F warrants to purchase 6,110,000 shares of common stock at $0.70 per share; 2,263,750 shares of Preferred Stock were issued in exchange for the delivery and cancellation of Series A, B, C, D, E and F warrants previously issued by us to the Vision Parties, the Company recorded a gain of $45,835 related to the exchange of the warrants for preferred stock; and 4,051,948 shares of Preferred Stock were issued to satisfy the Company’s obligation to issue equity to the Vision Parties pursuant to a Securities Purchase Agreement dated on March 24, 2008 and amended on May 28, 2009. Under the Exchange Agreement, Ki Nam, The Company’s Chief Executive Officer and Chairman of the Board of Directors of the Company, also agreed to convert a promissory note plus the accrued interest, previously issued to him by the Company into 976,865 shares of Preferred Stock and warrants to purchase up to 1,953,730 shares of common stock (which warrants have the same terms as the Warrants issued to Vision pursuant to the Purchase Agreement).

     The Company, Mr. Nam and Vision Parties also entered into a Stockholders Agreement, whereby Mr. Nam agreed to vote, in the election of members of the Company’s board of directors, all of his voting shares of the Company in favor of (i) two nominees of Vision Parties so long as their ownership of common stock of the Company is 22% or more or (ii) or one nominee of Vision Parties so long as their ownership of common stock of the Company is 12% or more.

     On May 28, 2009, the Company issued to Vision, 10% Debentures, with an aggregate principal value of $600,000. As noted above, these 10% Debentures were cancelled in connection with the December 30, 2009 financing with Vision. Additionally, Vision received Series E Common Stock Purchase Warrants to purchase up to an aggregate 300,000 shares of the Company’s common stock at an exercise price of $1.20 per share. Such Series E Common Stock Purchase Warrants were exchanged for shares of Preferred Stock in connection with the December 30, 2009 financing with Vision.

     On December 30, 2008, the Company sold $2.2 million in debentures and warrants through a private placement to Vision pursuant to a Securities Purchase Agreement. On December 30, 2009, pursuant to the Exchange Agreement, the Company issued to the Vision Parties, shares of Preferred Stock in exchange for the delivery and cancellation of these debentures and accrued interest.

     The reduction in exercise prices of Series B and C Warrants (which were exchanged on December 30, 2009 for Preferred Stock) was deemed to be a modification and resulted in additional recognition of approximately $79,000 as debt issuance cost at December 31, 2008. Moreover, the Company recorded a total debt discount of $1,215,638 for the effective beneficial conversion feature (“BCF”) of the debenture and debt discount related to the issuance of Series D Warrants (which were exchanged on December 30, 2009 for Preferred Stock), for the year ended December 31, 2008. The debt discount for the Series D Warrants was calculated using the Black-Scholes-Merton option pricing model. The BCF and warrants are amortized to interest expense over the one-year life of the note.

     The value of the debt discount was allocated between the debentures, the warrants, and the BCF, which amounted to $291,327, $201,222, $1,549,481 and $1,077,652, respectively, for the year ended December 31, 2009, and $607,819 and $607,819, respectively, for 2008. The discount of $3,119,682 and $1,215,638 as of December 31, 2009 and 2008, respectively, related to the warrants and the BCF, is being amortized over the term of the Debentures. The Company amortized $1,950,506 for the nine months ended September 30, 2010, and $2,317,792 and $2,236 for the years ended December 31, 2009 and 2008, respectively. The remaining unamortized warrant and beneficial conversion feature value is recorded as a discount on the Debentures on the accompanying balance sheet.

     During the nine months ended September 30, 2009, the Company amortized $1,363,848 of interest expense related to a debt discount on a different note to Vision that was ultimately exchanged for shares of the Company’s Preferred Stock.

     As of September 30, 2010, December 31, 2009 and December 31, 2008, the related party note payable balance, net of discount, due Vision was $2,552,931, $878,102 and $986,598, respectively.

Loan Agreement with Ki Nam

     On March 30, 2009, the Company entered into a loan agreement with Ki Nam, its chairman and CEO, whereby, Mr. Nam agreed to advance the Company up to $1,000,000, including $498,528 that had already been advanced by Mr. Nam for operating capital requirements through December 31, 2008. The line of credit was to remain open until the Company raised $10.0 million in equity. The note bore interest at 10% per annum. In the event the Company received (i) $10,000,000 or more in private placement financing or (ii) $15,000,000 or more in equity financing at any time after the date of the loan, the note was to become immediately due and payable.

     In connection with the loan agreement, the Company agreed to issue warrants to Mr. Nam for the purchase of up to 303,030 shares of the Company’s common stock, $0.001 par value per share, at $2.00 per share, subject to adjustment. The total number of warrants to be issued was dependent on the final amount of the loan. During the year ended December 31, 2009, the Company was advanced $414,963, including accrued interest, under the loan agreement. During the year ended December 31, 2009, 274,774 warrants were issued to Mr. Nam pursuant to the terms of the loan agreement The Company recorded a debt discount of $246,228 related to the estimated fair value of warrants, which was to be amortized as interest expense over the term of the loan agreement. The loan was convertible during the pendency of any current open equity financing round at $1.65 per share, subject to adjustment. Upon conversion, Mr. Nam was to receive additional warrants for the purchase of up to 606,060 shares of the Company’s common stock at $2.00 per share.

     For the nine months ended September 30, 2010 the Company received advances from Mr. Nam of which $390,000 was repaid in October of 2010.

     In December 2009, the Company issued 2,000,000 shares of its Series A Convertible Preferred Stock in connection with an equity offering (see Note 10). As a result of the December 2009 equity offering, the Company recorded the estimated fair value of the conversion feature of $443 as a debt discount, which was to be amortized to interest expense over the remaining term of the loan agreement. The Company recorded the corresponding amount as a derivative liability and any change in fair value of the conversion feature was to be recorded through earnings at each reporting date. The change in fair value of the conversion feature was not significant for the period ended December 31, 2009.

     On December 30, 2009, the Company entered into a Securities Exchange Agreement (the “Exchange Agreement”) with Mr. Nam. Under the Exchange Agreement, Mr. Nam agreed to convert the balance of the promissory note, including accrued interest, of $976,865 into 976,865 shares of the Company’s Series A Convertible Preferred Stock and warrants to purchase up to 1,953,730 shares of the Company’s common stock, exercisable at $0.70 per share, subject to adjustment. The ability for Mr. Nam to receive additional warrants for up to 606,060 shares of common stock was cancelled.

     In connection with the Exchange Agreement, the Company agreed to convert Mr. Nam’s outstanding debt balance of $976,865 at $0.50 per share, which was below the adjusted conversion price pursuant to the terms of the loan agreement. Pursuant to the conversion terms of the loan agreement, Mr. Nam would have received only 313,098 shares of stock. As a result, the Company issued Mr. Nam 663,767 additional shares of the Company’s Series A Convertible Preferred Stock in connection with his debt conversion.

     As a result of the Exchange Agreement, the entire debt discount amounting to $246,671 was amortized to interest expense. In addition, as the Company issued shares to Mr. Nam in excess of the number of shares pursuant to the terms of the loan agreement, the Company recorded the fair value of the 663,767 additional shares issued as a loss on debt extinguishment. The amount recorded of $663,767 was included in other expense in the accompanying consolidated statement of operations for the year ended December 31, 2009.

Lock-Up Agreement

     In connection with the Vision financing, Ki Nam, the Company’s Chief Executive Officer and Chairman of the Board of Directors of the Company agreed not to transfer, sell, assign, pledge, hypothecate, give, create a security interest in or lien on, place in trust (voting trust or otherwise), or in any other way encumber or dispose of, directly or indirectly and whether or not voluntarily, without express prior written consent of Vision, any of the Company’s common stock equivalents of the Company until August 27, 2010; provided, however, that commencing on August 27, 2010, he may sell up to 1/24ths of the shares of common stock of the Company in each calendar month through February 28, 2011.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

The following discussion and analysis of our results of operations for the three and nine months ended September 30, 2010 and 2009 (unaudited) and for the years ended December 31, 2009, 2008 and 2007 and financial condition as of September 30, 2010 and 2009 (unaudited) and December 31, 2009 and 2008, should be read in conjunction with our consolidated financial statements and the notes to those consolidated financial statements that are included elsewhere in this registration statement. All statements, other than statements of historical facts, included in this report are forward-looking statements. When used in this report, the words “may,” “will,” “should,” “would,” “anticipate,” “estimate,” “possible,” “expect,” “plan,” “project,” “continuing,” “ongoing,” “could,” “believe,” “predict,” “potential,” “intend,” and similar expressions are intended to identify forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to, availability of additional equity or debt financing, changes in sales or industry trends, competition, retention of senior management and other key personnel, availability of materials or components, ability to make continued product innovations, casualty or work

stoppages at the Company’s facilities, adverse results of lawsuits against the Company and currency exchange rates. Forward-looking statements are based on assumptions and assessments made by the Company’s management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Readers of this report are cautioned not to place undue reliance on these forward-looking statements, as there can be no assurance that these forward-looking statements will prove to be accurate and speak only as of the date hereof. Management undertakes no obligation to publically release any revisions to these forward-looking statements that may reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. This cautionary statement is applicable to all forward-looking statements contained in this report.

Overview

     T3 Motion, Inc. (the “Company”, “we” or “us”) was organized on March 16, 2006, under the laws of the state of Delaware. We develop and manufacture the T3 Series which are electric three-wheel stand-up vehicles that are directly targeted to the public safety and private security markets. T3 Series have been designed to tackle a host of daily professional functions, from community policing to patrolling of airports, military bases, campuses, malls, public event venues and other high-density areas. We continue to design and introduce products based on modularity of the sub systems we have created. In September 2009, we launched our second product, the CT Micro Car . The Micro Car is another product line to sell to our potential and existing customers. In June 2010, we introduced the GT3, a plug-in hybrid consumer vehicle.

Critical Accounting Policies and Estimates

     Our management’s discussion and analysis of our financial condition and results of operations are based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported net sales and expenses during the reporting periods. On an ongoing basis, we evaluate our estimates and assumptions. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

     A summary of these policies can be found in the Management’s Discussion and Analysis section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2009. The following is an update to the critical accounting policies and estimates.

Going Concern

     The Company’s condensed consolidated financial statements are prepared using the accrual method of accounting in accordance with GAAP and have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The Company has sustained operating losses since its inception (March 16, 2006) and has used substantial amounts of working capital in its operations. Management has been and is continuing to implement its cost reduction strategy for material, production and service costs. Until management achieves its cost reduction strategy and is able to generate sales to realize the benefits of the strategy over the next year and sufficiently increases cash flow from operations, the Company will require additional capital to meet its working capital requirements, debt service, research and development, capital requirements and compliance requirements. Further, at September 30, 2010, the Company has an accumulated deficit of $40,414,711, a working capital deficit of $14,324,467 and a cash balance of $40,966. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time.

     Management believes that its current sources of funds and current liquid assets will allow the Company to continue as a going concern through at least December 31, 2010. During 2010, the Company has obtained equity financing from third parties of approximately $1,155,000, has received advances from shareholders of $1.8 million and refinanced the outstanding balance of $1.0 million related to the note to Immersive Media Corporation

(“Immersive”). The board of directors has allowed for Ki Nam, the Company’s CEO and chairman of the board, to loan the company up to $2.0 million and an additional shareholder to loan the Company up to $1.0 million. The Company plans to raise additional debt and/or equity capital to finance future activities. In light of these plans, management is confident in the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements included elsewhere in this report do not include any adjustments that might result from the outcome of this uncertainty.

Cash and Cash Equivalents

     Cash and cash equivalents consist of all highly liquid investments with original maturities of three months or less.

Restricted Cash

     Under a credit card processing agreement with a financial institution, the Company is required to maintain a security reserve deposit as collateral. The amount of the deposit is at the discretion of the financial institution and as of September 30, 2010 was $10,000.

Concentrations of Credit Risk

     As of September 30, 2010 and December 31, 2009, one customer accounted for approximately 12% and two customers accounted for approximately 11% of total accounts receivable. Two customers accounted for approximately 26% and one customer accounted for approximately 14% of net revenues for the three months ended September 30, 2010 and 2009, respectively, and no single customer accounted for more than 10% of net revenues for the nine months ended September 30, 2010 and 2009.

     As of September 30, 2010 and December 31, 2009, two vendors accounted for approximately 11% and 12%, respectively, of total accounts payable. One vendor accounted for approximately 23% and 18% of purchases for the three months ended September 30, 2010 and 2009, respectively no single vendor accounted for more than 10% of purchases for the nine months ended September 30, 2010 and 2009, respectively.

Fair Value of Financial Instruments

     The Company’s financial instruments consist of cash and cash equivalents, restricted cash accounts receivable, related party receivables, accounts payable, accrued expenses, related party payables, notes payable and derivative liabilities, related party notes payable and derivative liabilities. The carrying value for all such instruments, except related notes payable and derivative liabilities approximates fair value due to the short-term nature of the instruments. The Company cannot determine the fair value of its related party notes payable due to the related party nature and instruments similar to the notes payable could not be found. The Company’s derivative liabilities are recorded at fair value.

Revenue Recognition

     The Company recognizes revenues when there is persuasive evidence of an arrangement, product delivery and acceptance have occurred, the sales price is fixed or determinable and collectibility of the resulting receivable is reasonably assured.

     For all sales, the Company uses a binding purchase order as evidence of an arrangement. Delivery occurs when goods are shipped to customers. The Company ships with either FOB Shipping Point or Destination terms. Shipping documents are used to verify delivery and customer acceptance. For FOB Destination, the Company records revenue when proof of delivery is confirmed by the shipping company. The Company assesses whether the sales price is fixed or determinable based on the payment terms associated with the transaction and whether the sales price is subject to refund. The Company offers a standard product warranty to its customers for defects in materials and workmanship for a period of one year or 2,500 miles, whichever comes first, and has no other post-shipment obligations. The Company assesses collectibility based on the creditworthiness of the customer as determined by evaluations and the customer’s payment history.

     All amounts billed to customers related to shipping and handling are classified as net revenues, while all costs incurred by the Company for shipping and handling are classified as cost of revenues.

     The Company does not enter into contracts that require fixed pricing beyond the term of the purchase order. All sales via distributor agreements are accompanied by a purchase order. Further, the Company does not allow returns of unsold items.

     The Company has executed various distribution agreements whereby the distributors agreed to purchase T3 Series packages (one T3 Series, two power modules, and one charger per package). The terms of the agreements require minimum re-order amounts for the vehicles to be sold through the distributors in specified geographic regions. Under the terms of the agreements, the distributor takes ownership of the vehicles and the Company deems the items sold at delivery to the distributor.

Business Segments

     The Company currently only has one reportable business segment due to the fact that the Company derives its revenue primarily from one product. The revenue from domestic sales and, international sales are shown below:

		For the Three Months Ended September 30,								For the Nine Months Ended September 30,
		2010				2009				2010				2009
		(unaudited)								(unaudited)
Net revenues:
T3 Domestic		$	677,918			$	1,122,407			$	3,078,658			$	2,715,653
T3 International			369,655				43,452				546,873				693,173
Total net revenues		$	1,047,573			$	1,165,859			$	3,625,531			$	3,408,826