SOBR

Business Context and Reporting Period

This Form 10-Q covers the quarterly period ended March 31, 2011, for Imagine Media, Ltd. (Note: The request metadata listed "SOBR Safe, Inc.", but the filing text identifies the registrant as Imagine Media, Ltd.). The Company is a shell company and a smaller reporting company. Originally formed to publish a regional magazine, the Company abandoned its publishing business plan in January 2009. As of the reporting date, the Company had no active revenue-generating operations and was seeking to acquire another business to continue as a going concern.

Key Financial Metrics

Debt and Liquidity: The Company holds minimal cash ($37) against total current liabilities of $210,726, resulting in a significant working capital deficit. Liabilities include $103,359 in trade accounts payable, $39,440 in indebtedness to related parties, a $30,000 convertible debenture, and $17,300 in short-term advances.

Material Changes vs. Prior Period

• Revenue: Remained at zero for both periods; the Company has no active operations.
• Expenses: Operating expenses decreased by approximately 27% from $10,974 in Q1 2010 to $7,996 in Q1 2011, primarily due to reduced selling, general, and administrative costs.
• Net Loss: The net loss narrowed from $(11,874) to $(8,896), reflecting the reduction in operating expenses.
• Liquidity: Cash balances declined from $83 at the end of 2010 to $37 at March 31, 2011. Net cash used in operating activities improved significantly (less negative) compared to the prior year quarter.
• Liabilities: Total current liabilities increased by $8,849, driven by increases in accounts payable and accrued expenses.

Outlook, Risks, and Unusual Items

Going Concern Uncertainty

Management and independent auditors have expressed substantial doubt regarding the Company's ability to continue as a going concern. The Company has incurred operating losses, has a working capital deficit, and lacks sufficient cash flow to meet obligations. Continuation depends on generating cash flow, restructuring debt, increasing equity, or acquiring another business.

Acquisition Activity

• Terminated Deal: An agreement to acquire JAKK'D Holdings, LLC, entered in October 2010, was terminated in January 2011.
• Pending Acquisition: In April 2011 (subsequent to the period end), the Company entered a tentative agreement to acquire Transbiotec, Inc. (TBT) in exchange for approximately 23.6 million shares of common stock. TBT develops a transdermal sensor to detect blood alcohol levels. Completion is subject to due diligence and definitive agreements.

Legal Contingencies

The Company faces a potential trademark infringement issue regarding the name "Image Magazine" with a California-based publisher. Management does not expect a material impact due to the discontinuation of publishing operations, but a license agreement has not been finalized.

Related Party Transactions

A significant portion of liabilities ($39,440) is owed to related parties. Additionally, the Company has a $30,000 convertible debenture owed to an attorney with accrued interest of $8,400.

Investor Verification Checklist

• Shell Status: Verify the Company's status as a shell company with no current revenue or operations.
• Going Concern: Confirm the severity of the working capital deficit ($210,689) and the lack of committed capital to fund future operations.
• Acquisition Risk: Assess the likelihood of the pending Transbiotec, Inc. acquisition closing, noting it is tentative and subject to conditions.
• Dilution Potential: Review the proposed exchange of 23.6 million shares for TBT against the current outstanding share count of 1.4 million, which would result in massive dilution to existing shareholders.
• Debt Obligations: Verify the terms of the $30,000 convertible debenture and related party debts, which are due on demand or have defaulted.