Attached files
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q/A
|X| Quarterly Report Pursuant To Section 13 or 15(d) of The Securities Exchange
Act Of 1934
For the quarterly period ended September 30, 2011
|_| Transition Report Under Section 13 or 15(d) of The Securities Exchange Act
Of 1934
For the transition period from __________ to __________
Commission File Number: 000-53316
IMAGINE MEDIA, LTD.
-------------------------------
(Exact name of registrant as specified in its charter)
Delaware 26-0731818
------------------------------- ------------------------------------
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
3030 Old Ranch Parkway, Suite 350
Seal Beach, CA 90740
-----------------------------------
(Address of principal executive offices, including Zip Code)
(562) 280-0483
-------------------------
(Issuer's telephone number, including area code)
7750 N. Union Blvd., # 201
Colorado Springs, CO 80920
-------------------------------
(Former name or former address if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [x] No [ ]
Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). Yes [ ] No [X ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a small reporting company. See
the definitions of "large accelerated filer," "accelerated filer,"
"non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the
Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [x]
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 12,416,462 shares of common stock as
of November 15, 2011.
Imagine Media, Ltd. And Subsidiary
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
Quarter Ended September 30, 2011
Imagine Media, LTD
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
September 30, 2011
Dec. 31, 2010 (Unaudited)
------------- ------------------
ASSETS
Current assets
Cash $ 30,695 $ 8,109
Due from Triumph Capital 100
------------- -------------
Total current assets 30,695 8,209
------------- -------------
Fixed assets - net 2,043 5,135
------------- -------------
Total Assets 32,738 13,344
============= =============
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 279,840 $ 148,401
Accrued interest payable 508,180 522,610
Notes payable - current -
related parties 594,966 29,760
Notes payable - current - 22,800
Related party payables 130,565 106,450
Other payables 97,464 97,464
------------- -------------
Total current liabilties 1,611,015 927,485
------------- -------------
Notes payable - 8 % Debenture 30,000
Notes payable - related parties 153,879 -
------------- -------------
Total Long term liabilties 153,879 30,000
Total Liabilities 1,764,894 957,485
------------- -------------
Stockholders' Equity
Common stock, $.0001 par value;
100,000,000 shares authorized;
12,379,320 shares issued and
outstanding, (9,301,369 - 2010) 930 1,380
Additional paid in capital 7,297,203 8,888,579
Treasury stock at cost (242,187) (209,062)
Deficit accumulated during the
development stage (9,619,537) (10,078,225)
------------- -------------
Total Imagine Stockholders' Equity (2,563,591) (1,397,328)
------------- -------------
Non Controlling interest (831,435) (453,188)
------------- -------------
Total Liabilities and Stockholders'
Equity $ 32,738 $ 13,344
============= =============
The accompanying notes are an integral part of the financial statements.
2
Imagine Media, LTD.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
Nine Months Nine Months
Ended Ended
September 30, 2010 September 30, 2011
(Unaudited) (Unaudited)
------------------- ---------------------
Revenues $ - $ -
-------------- ------------
- -
-------------- ------------
Operating expenses:
Amortization & depreciation 5,534 971
Advertising - 6,500
Insurance - 3,561
Licenses,Permits and Taxes 974
Office Expense 3,460 2,256
Professional and sub
contractor fees 131,047 170,663
Rent 13,900 15,300
Research and Product Development 1,350 34,618
Salary and Wages 53,262 96,778
Telephone 456 1,054
Travel and Entertainment 6,987 19,178
-------------- ------------
215,995 351,854
-------------- ------------
Gain (loss) from operations (215,995) (351,854)
-------------- ------------
Other income (expense):
Interest expense (186,448) (106,838)
-------------- ------------
Income (loss) before
provision for income taxes (402,443) (458,692)
Provision for income tax - -
-------------- ------------
Net income (loss) $ (402,443) $ (458,692)
============== ============
Net income (loss) per share
(Basic and fully diluted) $ (0.04) $ (0.04)
============== ============
Weighted average number of
common shares outstanding 9,300,834 12,450,218
============== ============
The accompanying notes are an integral part of the financial statements.
3
Imagine Media, LLC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Three Months
Ended Ended
September 30, 2010 September 30, 2011
(Unaudited) (Unaudited)
------------------ ------------------
Revenues $ - $ -
-------------- -------------
- -
-------------- -------------
Operating expenses:
Amortization & depreciation - 198
Advertising - 4,000
Insurance 1,312
Licenses, Permits and Taxes 139
Office Expense 144 410
Professional and sub
contractor fees 38,897 111,586
Rent 3,700 5,100
Research and Product
Development 2,259 3,039
Salary and Wages - 69,990
Telephone - 294
Travel and Entertainment 5,737 4,747
-------------- -------------
50,737 200,816
-------------- -------------
Gain (loss) from operations (50,737) (200,816)
-------------- -------------
Other income (expense):
Interest expense (62,149) (3,288)
-------------- -------------
Income (loss) before
provision for income taxes (112,886) (204,104)
Provision for income tax - -
-------------- -------------
Net income (loss) $ (112,886) $ (204,104)
============== =============
Net income (loss) per share
(Basic and fully diluted) $ (0.01) $ (0.02)
============== =============
Weighted average number of
common shares outstanding 8,625,709 12,288,149
============== =============
The accompanying notes are an integral part of the financial statements.
4
Imagine Media, LTD.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Months Ended Nine Months Ended
September 30, 2010 September 30, 2011
(Unaudited) (Unaudited)
------------------ ------------------
Cash Flows From Operating Activities:
Net income (loss) $ (402,443) $ (458,692)
----------- ----------
Adjustments to reconcile net loss
to net cash provided by (used for)
operating activities:
Amortization & depreciation 5,534 970
Compensatory equity issuances 53,262 -
Asset write offs - -
Other assets - -
Accrued payables 311,756 48,135
Note payable, benefical conversion
expense - (267,276)
Original issue discount - interest
expense - -
----------- ----------
Net cash provided by (used
for)operating activities (31,891) (676,863)
----------- ----------
Cash Flows From Investing Activities:
Fixed asset purchases - 4,059
----------- ----------
Net cash provided by (used
for) investing activities $ - $ 4,059
----------- ----------
(Continued On Following Page)
The accompanying notes are an integral part of the financial statements.
5
TransBioTec, Inc.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Continued From Previous Page)
Nine Months Ended Nine Months Ended
September 30, 2010 September 30, 2011
(Unaudited) (Unaudited)
------------------ ------------------
Cash Flows From Financing Activities:
Notes & loans payable - borrowings $ 5,000 $ 16,000
Notes & loans payable - payments (988) (2,500)
Repurchase of treasury stock -
Equity issuances 27,650 636,718
----------- ----------
Net cash provided by (used for)
financing activities 31,662 650,218
----------- ----------
Net Increase (Decrease) In Cash (229) (22,586)
Cash At The Beginning of the Period 704 30,695
----------- ----------
Cash At The End of the Period $ 475 $ 8,109
=========== ==========
Schedule Of Non-Cash Investing and Financing Activities
Compensatory equity issuances $ - $ -
Debt converted to capital $ - $1,072,068
Supplemental Disclosure
Cash paid for interest $ 122 $ -
Cash paid for income taxes $ - $ -
The accompanying notes are an integral part of the financial statements.
6
Imagine Media LTD
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Imagine Media LTD was incorporated August, 2007 in the State of Delaware.
TransBioTec Inc. was formed in the state of California July 4, 2004. Effective
September 19, 2011 TransBioTec was acquired by Imagine Media LTD. in a
transaction was accounted for similar to a reverse acquisition as the members of
TransBioTec retained the majority of the outstanding common stock of Imagine
Media LTD after the share exchange. The accounting for the transaction was
identical to that resulting from a reverse acquisition, except that no goodwill
or other intangibles were recorded. Imagine Media LTD is in the process of
changing its name from Imagine Media LTD. TransBioTec, Inc. The financial
statements represent the activity of TransBioTec, Inc from July 4 2004 forward,
and the consolidated activity of Imagine Media LTD and TransBioTec from
September 19, 2011 forward. Imagine Media LTD and TransBioTec are hereinafter
referred to collectively as the "Company". The Company has developed and plans
to market and sell a non-invasive alcohol sensing system which includes an
ignition interlock. The Company is currently considered to be in the development
stage, and has not generated revenues from its activities.
Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance
with the instructions to Form 10-Q and do not include all of the information and
disclosures required by generally accepted accounting principles for complete
financial statements. All adjustments which are, in the opinion of management,
necessary for a fair presentation of the results of operations for the interim
periods have been made and are of a recurring nature unless otherwise disclosed
herein. The results of operations for such interim periods are not necessarily
indicative of operations for a full year.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates.
Cash and cash equivalents
The Company considers all highly liquid investments with an original maturity of
three months or less as cash equivalents.
7
Imagine Media LTD
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (cont'd)
Accounts receivable
The Company reviews accounts receivable periodically for collectability and
establishes an allowance for doubtful accounts and records bad debt expense when
deemed necessary. At December 31, 2009 and 2010, and September 30, 2011 the
Company had no balance in accounts receivable or the allowance for doubtful
accounts.
Property and equipment
Property and equipment are recorded at cost and depreciated under straight line
methods over each item's estimated useful life.
Revenue recognition
Revenue is recognized on an accrual basis as earned under contract terms. The
Company has had no revenues to date
Advertising costs
Advertising costs are expensed as incurred. The Company recorded no material
advertising costs in 2009 or 2010, or for the Nine months ended September 30,
2011.
Income tax
The Company accounts for income taxes pursuant to ASC 740. Under ASC 740
deferred taxes are provided on a liability method whereby deferred tax assets
are recognized for deductible temporary differences and operating loss
carryforwards and deferred tax liabilities are recognized for taxable temporary
differences. Temporary differences are the differences between the reported
amounts of assets and liabilities and their tax bases. Deferred tax assets are
reduced by a valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets will not be
realized. Deferred tax assets and liabilities are adjusted for the effects of
changes in tax laws and rates on the date of enactment.
8
Imagine Media LTD
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (cont'd)
Net income (loss) per share
The net income (loss) per share is computed by dividing the net income (loss) by
the weighted average number of shares of common outstanding. Warrants, stock
options, and common stock issuable upon the conversion of the Company's
preferred stock (if any), are not included in the computation if the effect
would be anti-dilutive and would increase the earnings or decrease loss per
share.
Financial Instruments
The carrying value of the Company's financial instruments, as reported in the
accompanying balance sheets, approximates fair value.
Long-Lived Assets
In accordance with ASC 350, the Company regularly reviews the carrying value of
intangible and other long-lived assets for the existence of facts or
circumstances, both internally and externally, that may suggest impairment. If
impairment testing indicates a lack of recoverability, an impairment loss is
recognized by the Company if the carrying amount of a long-lived asset exceeds
its fair value.
Products and services, geographic areas and major customers
The Company is currently in the developmental stage and has no revenue.
9
Imagine Media LTD
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (cont'd)
Stock based compensation
The Company accounts for employee and non-employee stock awards under ASC 718,
whereby equity instruments issued to employees for services are recorded based
on the fair value of the instrument issued and those issued to non-employees are
recorded based on the fair value of the consideration received or the fair value
of the equity instrument, whichever is more reliably measurable.
NOTE 2. RELATED PARTY TRANSACTIONS
At year end 2009 and 2010, and September 30, 2011 the Company had payables due
to officers for accrued compensation of $361,565, $130,565, and $10,565.
In 2009 a related party shareholder converted $52,000 in note principal and
interest into 20,800 common shares. In 2010 an officer converted $325,000 in
compensation owed him into 130,000 common shares. During the nine months ended
September 30, 2011 related party shareholders converted $829,164 in note
principal and interest into 552.032 common shares, and $135,000 in compensation
to 54,000 shares in TransBioTec.
NOTE 3. FIXED ASSETS
Fixed asset values recorded at cost are as follows:
December 31, (Unaudited)
2009 2010 September 31, 2011
---- ---- ------------------
Automobile $ 33,383 $ 33,383 $ 33,383
Office and Lab Equipment 31,896 31,896 35,956
Furniture and fixtures 11,596 11,596 11,596
---------- ---------- ----------
76,875 76,875 80,935
Less accumulated depreciation (67,453) (74,832) (75,604)
---------- ---------- ----------
Total $ 9,422 $ 2,043 $ 5,331
========== ========== ==========
10
Imagine Media LTD.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 3. FIXED ASSETS (cont'd)
Depreciation expense in 2009 and 2010, and for the nine months ended September
30, 2011 was $10,140, $7,379 and $770 respectively.
NOTE 4. NOTES PAYABLE
December 31, (Unaudited)
2009 2010 September 31, 2011
---- ---- ------------------
Note payable to related party,
unsecured, due 8/3/2012, interest
rate 0% $ 1,950 $ 1,950 $ 1,950
Note payable to related party,
unsecured, due 9/17/2008,
convertible at holder's option
at $1 per share, interest rate
10% plus agreed upon amounts $ 187,256 $184,156 $ -
Note payable to related party,
unsecured, due 12/15/2013, monthly
interest due, convertible at
holder's option at $2.50 per share,
interest rate 22.1% $ 150,000 $150,000 $ -
Note payable to related party,
unsecured, due 05/28/2009,
convertible at holder's option at
$2.50 per share, original issue
discount of 20%, with interest at
$444 per day after due date $ 240,000 $240,000 $ -
Note payable to related party,
unsecured, due 07/27/2012,
convertible at holder's option
at $2.50 per share, interest
rate 8% $ 151,929 $151,929 $ -
11
Imagine Media LTD.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 4. NOTES PAYABLE (cont'd)
December 31, (Unaudited)
2009 2010 September 31, 2011
---- ---- ------------------
Notes payable to related parties,
unsecured, due 01/29/2011, convertible
at holder's option at $2.50 per share,
interest rate 9% $ - $ 5,000 $ -
Notes payable to related parties,
unsecured, due 12/31/2012,
interest rate 0% $ - $ 15,810 $ 11,810
Note payable to related party,
unsecured, due 09/15/2012, convertible
at holder's option at $2.50 per
TransBioTec share interest rate 10% $ - $ - $ 16,000
Note payable to Ford Motor Credit,
secured, payment $584.25 per month $ 4,657 $ - $ -
------- -------- ----------
$735,792 $ 748,845 $ 29,760
Less current portion (581,913) (594,966) (29,760)
-------- --------- ----------
Long-term portion $ 153,879 $ 153,879 $ -
========= ========= ==========
Required principal payments from December 31, 2010 forward are as follows:
2011 $ -
2012 29,760
----------
$ 29,760
Interest expense under notes payable in 2009 and 2010, and for the six months
ended June 30, 2011 was $206,078, $238,851, and $106,838.
Convertible debenture payable to
unrelated party, unsecured, due
04/1/2009, convertible at holder's
option at $.25 per share, interest
rate 8% Default interest rate 12%
Long-term portion $ 30,000 $ 30,000 $ 30,000
12
Imagine Media LTD.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5. INCOME TAXES
Deferred income taxes arise from the temporary differences between financial
statement and income tax recognition of net operating losses. These loss
carryovers are limited under the Internal Revenue Code should a significant
change in ownership occur.
At December 31, 2009 and 2010 the Company had net operating loss carryforwards
of approximately $604,000 and $1,045,000 respectively, which begin to expire in
2027. The deferred tax asset of at each date of $120,000 and $209,000 created by
the net operating losses has been offset by a 100% valuation allowance. The
change in the valuation allowance in 2009 and 2010 was approximately $21,000 and
$89,000.
NOTE 6. STOCK OPTIONS
The Company accounts for employee and non-employee stock options under ASC 718,
whereby option costs are recorded based on the fair value of the consideration
received or the fair value of the equity instruments issued, whichever is more
reliably measurable. Unless otherwise provided for, the Company covers option
exercises by issuing new shares.
The Company's stock option activity is described below.
Non-employee stock options
At the beginning of 2009 the Company had 60,000 non-employee stock options
outstanding, allowing the holder to purchase one share of common stock per
option, exercisable at $0.10 per share, with terms expiring from 2011 - 2013.
During the year 50,000 options were exercised, and no options expired, leaving a
2009 year end outstanding balance of 10,000 non-employee stock options expiring
in December 2011.
During 2010 the Company granted 22,500 options for services, allowing the holder
to purchase one share of common stock per option, with 22,500 options
exercisable immediately at prices from $0.10 - $0.15 per share with the option
terms expiring from January 2012 through January 2015. During 2010 no options
were exercised, and no options expired, leaving a 2010 year end outstanding
balance of 32,500 non-employee stock options. The fair value of the 22,500
options granted in 2010 was estimated on the date of grant using the
Black-Scholes option pricing model with the following assumptions: risk free
interest rate of 1.08% - 2.67%, dividend yield of 0%, expected lives of 2 - 5
years, volatility of 100%. The Company incurred and recorded compensation
expense under these stock option grants of $53,262 in 2010.
13
Imagine Media LTD.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 6. STOCK OPTIONS (cont'd)
During the six months ended June 30, 2011 10,000 options were exercised, and no
options expired, leaving a June 30, 2011 outstanding balance of 22,500
non-employee stock options, exercisable at prices from $0.10 - $0.15 per share
with the option terms expiring from January 2012 through January 2015.
Employee stock options
The Company had no outstanding employee stock options in 2009 or 2010, or during
the six months ended September 30, 2011.
NOTE 7. GOING CONCERN
The Company has suffered recurring losses from operations and has a working
capital deficit and stockholders' deficit, and in all likelihood will be
required to make significant future expenditures in connection with continuing
marketing efforts along with general administrative expenses. These conditions
raise substantial doubt about the Company's ability to continue as a going
concern.
The Company may raise additional capital through the sale of its equity
securities, through an offering of debt securities, or through borrowings from
financial institutions or others. By doing so, the Company hopes to generate
revenues from sales of its alcohol sensing and ignition lock systems. Management
believes that actions presently being taken to obtain additional funding provide
the opportunity for the Company to continue as a going concern.
14
Item 2. Management's Discussion and Analysis of Financial Condition and Plan of
Operation
The Company was formed in August 2007 to publish and distribute Image
Magazine, a monthly guide and entertainment source for the Denver, Colorado
area. The Company generated only limited revenue and essentially abandoned its
business plan in January 2009.
On September 19, 2011 the Company acquired approximately 52% of the
outstanding shares of TransBiotec, Inc., ("TBT") from TBT's directors, in
exchange for 12,416,462 shares of the Company's common stock. TBT is a
California Corporation. Prior to the acquisition the Company had 1,500,000
outstanding shares of common stock.
The Company is currently acquiring the remaining outstanding shares of TBT
from the remaining TBT shareholders in consideration for the issuance of
11,141,348 additional shares of the Company's common stock.
As a result of the acquisition, TBT's business is that of the Company's,
and, unless otherwise indicated, any references to the Company include the
business and operations of TBT.
TBT as the accounting acquirer in the transaction recorded the acquistion
as the issuance of stock for the net monetary assets of the Company accompanied
by a recapitalization. This accounting for the transaction was identical to that
resulting from a reverse acquisition, except that no goodwill or other
intangible assets were recorded.
TBT, headquartered in Seal Beach, California, has developed and patented a
high technology, state-of-the-art transdermal sensor, that detects blood alcohol
levels through a person's skin. Ethanol is produced as alcohol is ingested and
metabolized in the body. The system senses ethanol excreted through
perspiration. A person places their finger on the sensor, and within 5-8
seconds, the sensor will detect the ethanol level. A signal can then be sent to
output devices that control the ignition in a vehicle to prevent it from
starting. The system can also communicate with other devices such as a GPS unit,
or cell phone.
The TBT system is unobtrusive, accurate, reliable, durable, low cost,
easier to use and faster than the current breathalyzer applications. TBT has
completed its beta testing of the sensor and is currently developing its
manufacturing capability.
Initially, TBT intends to offer its sensor only for commercial vehicle
applications. Later, TBT plans to market its sensor to the public for use in
automobiles, SUV's, RV's, boats and other vehicles.
Completion of the Company's acquisition of TBT is subject to the
satisfaction of several conditions including without limitation, the execution
of a definitive agreement, the satisfactory completion of due diligence by both
parties, and the completion of an audit of TBT's financial statements. There can
be no assurance that the transaction will be consummated.
The following discussion:
2
o summarizes the Company's plan of operation; and
o analyzes TBT's financial condition and the results of its operations
for the the nine months ended September 30, 2011.
This discussion and analysis should be read in conjunction with TBT's
financial statements included as an exhibit to this report.
Plan of Operation and Capital Requirements
------------------------------------------
The Company's plan of operations is as follows:
Projected Estimated
Activity Completion Date Cost
-------- --------------- ---------
Develop relationship with initial customers
willing to work with Company in refining SOBR.
Will discount price for units sold to customers
who partner with Company in this phase. Identify
add-on features that may appeal to customers.
Complete design of printed circuit boards and
injection molding tools. Sales target of 500
units. January 2012 $160,000
Outsource manufacturing, packaging and shipping.
Complete joint venture agreement with GPS partner.
Develop add-on features such as cameras, GPS and
radio interfaces, and a fingerprint reader which
would allow the SOBR to determine the driver's
identity and blood alcohol content at the same
time. Improve production capability to 1,000
units per month. March 2012 $185,000
Improve manufacturing capability to 10,000 units
per month October 2012 $370,000
The Company will maintain its research and development efforts with a goal
of continuously improving the SOBR.
TBT's sources and (uses) of funds for the nine months ended September 30,
2011 and 2010 are shown below:
Nine Months ended September 30,
-------------------------------
2010 2011
---- ----
Net cash provided by
(used for) operations $ (31,890) $(676,863)
Loans, net of loan repayments $ 4,012 $ 13,500
3
Sale of stock $ 27,650 $ 636,718
Cash on hand at
beginning of the period $ 704 $ 30,695
The following table summarizes the Company's and TBT's combined contractual
obligations as of September 30, 2011:
2011 2012 2013 Total
---- ---- ---- -----
The notes payable, together $41,500 $62,300 $48,300 $152,100
with accrued interest
The Company does not have any off-balance sheet arrangements that have or
are reasonable likely to have a current or future material effect on its
financial condition, changes in financial condition, results of operations,
liquidity or capital resources.
Other than as disclosed above, the Company does not know of any trends,
demands, commitments, events or uncertainties that will result in, or that
reasonably likely to result in, the Company's liquidity increasing or decreasing
in any material way.
Other than as disclosed above, the Company does not know of any significant
changes in its expected sources and uses of cash.
Results of Operations
The Company was formed in August 2007 and generated only limited revenue
before it effectively ceased operations in January 2009. TBT was formed in July
2004 and has never generated any revenue.
Material changes in TBT's Statement of Operations for the nine months
September 30, 2011 as compared to the same period in the prior year are
discussed below:
Increase (I)
Item or Decrease (D) Reason
---- --------------- ------
Professional and Sub Contractor Fee (I) Product Development Costs
Research and Product Development (I) Purchase of materials
Salary and Wage (I) Hiring two sales
representatives.
Travel (I) Travel required in
connection with the
acquisition of TransBiotec.
Advertising (I) Web Site design
4
On September 15, 2011 TBT entered into an agreement with Ventura LLC
("Ventura"). Pursuant to the agreement, Ventura will receive the following
shares of the Company's common stock:
o 842,544 shares for assisting with the Company's acquisition of
its 52% interest in TBT;
o 842,544 shares when $250,000 is raised from the sale of 100,000
shares of the common stock of TBT at $2.50 per share. All shares
sold in this offering will be exchanged for shares of the common
stock of the Company on the basis of one TBT share for 7.726
shares of the Company's common stock;
o 842,544 for shares sold by the Company prior to March 31, 2012 to
investors introduced to the Company by Ventura, provided at least
$250,000 is raised from such investors prior to March 31, 2012;
o 842,544 shares for shares sold by the Company prior to March 31,
2012 to investors introduced to the Company by Ventura, provided
an additional $500,000 is raised from such investors prior to
March 31, 2012; and
o 842,544 shares for shares sold by the Company prior to March 31,
2012 to investors introduced to the Company by Ventura, provided
an additional $500,000 is raised from such investors prior to
March 31, 2012.
If the Company raises at least $1,250,000 from investors introduced to the
Company by Ventura, the Company will grant Ventura the exclusive rights to
Denver, Douglas and Jefferson counties, Colorado for installations and
recalibrations of the SOBR system.
As of September 30, 2011 Ventura has raised $240,000 and has been issued
100,000 shares of the TransBioTec, Inc. common stock.
Item 4. Controls and Procedures.
(a) The Company maintains a system of controls and procedures designed to
ensure that information required to be disclosed in reports filed or submitted
under the Securities Exchange Act of 1934, as amended ("1934 Act"), is recorded,
processed, summarized and reported, within time periods specified in the SEC's
rules and forms and to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the 1934 Act, is
accumulated and communicated to the Company's management, including its
Principal Executive and Financial Officer, as appropriate to allow timely
decisions regarding required disclosure. As of September 30, 2011, the Company's
Principal Executive and Financial Officer evaluated the effectiveness of the
design and operation of the Company's disclosure controls and procedures. Based
on that evaluation, the Principal Executive and Financial Officer concluded that
the Company's disclosure controls and procedures were effective.
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(b) Changes in Internal Controls. There were no changes in the Company's
internal control over financial reporting during the quarter ended September 30,
2011, that materially affected, or are reasonably likely to materially affect,
its internal control over financial reporting.
PART II
Item 6. Exhibits
Exhibits
31.1 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32 Certification pursuant to Section 906 of the Sarbanes-Oxley Act.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
IMAGINE MEDIA, LTD.
November 21, 2011 By: /s/ Charles Bennington
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Charles Bennington, Principal Executive,
Financial and Accounting Officer