sobr_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

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

For the quarterly period ended September 30, 2022

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

For the transition period from _______________ to _______________.

Commission file number: 000-53316

SOBR SAFE, INC.

(Exact name of registrant as specified in its charter)

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

6400 S. Fiddlers Green Circle, Suite 1400 Greenwood Village, Colorado		80111
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (844) 762-7723

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.00001 par value

SOBR

The Nasdaq Market

(NASDAQ)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

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

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

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

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

Applicable only to corporate issuers:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of November 10, 2022, there were 14,571,120 shares of common stock, $0.00001 par value, issued and outstanding.

SOBR SAFE, INC.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

ITEM 1	Condensed Consolidated Financial Statements	4

ITEM 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31

ITEM 3	Quantitative and Qualitative Disclosures About Market Risk	41

ITEM 4	Controls and Procedures	42

PART II – OTHER INFORMATION

ITEM 1	Legal Proceedings	43

ITEM 1A	Risk Factors	43

ITEM 2	Unregistered Sales of Equity Securities and Use of Proceeds	43

ITEM 3	Defaults Upon Senior Securities	44

ITEM 4	Mine Safety Disclosures	44

ITEM 5	Other Information	44

ITEM 6	Exhibits	45

Table of Contents

PART I – FINANCIAL INFORMATION

Forward-Looking Statement Disclaimer

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

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

Table of Contents

ITEM 1 Condensed Consolidated Financial Statements

The condensed consolidated balance sheets as of September 30, 2022, and December 31, 2021, the condensed consolidated statements of operations for the three and nine-months ended September 30, 2022, and 2021, the condensed consolidated statements of changes in stockholders’ equity (deficit) for the three and nine-months ended September 30, 2022, and 2021, and the condensed consolidated statements of cash flows for the nine-months ended September 30, and 2021, follow. The unaudited condensed consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. All such adjustments are of a normal and recurring nature.

Table of Contents

SOBR SAFE, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS

	September 30,			December 31,
	2022			2021
ASSETS	(Unaudited)			(Audited)

Current assets
Cash	$	7,248,677		$	882,268
Accounts receivable		8,484			-
Inventory		196,764			39,461
Prepaid expenses		656,140			12,553
Total current assets		8,110,065			934,282

SOBR Safe Intellectual Technology, net of accumulated amortization of $899,416 and $610,318 at September 30, 2022 and December 31, 2021, respectively		2,955,259			3,244,357

Other assets		27,427			30,576
Total Assets	$	11,092,751		$	4,209,215

LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)

Current liabilities
Accounts payable	$	166,024		$	270,150
Accrued expenses		382,345			463,900
Accrued interest payable		424,453			252,110
Related party payables		1,887			82,883
Common stock payable		70,500			-
Derivative liability		-			1,040,000
Convertible debenture payable
* Includes unamortized debt discount related to warrants, beneficial conversion feature and embedded conversion feature of none and $1,291,882 at September 30, 2022 and December 31, 2021, respectively		-	*		1,756,899	*
Current portion notes payable - related parties
* Includes unamortized debt discount related to warrants and beneficial conversion features of $271,575 and none at September 30, 2022 and December 31, 2021, respectively		740,235	*		11,810	*
Current portion notes payable - non-related parties
* Includes unamortized debt discount related to warrants and beneficial conversion features of $271,147 and none at September 30, 2022 and December 31, 2021, respectively		919,192	*		104,183	*
Total current liabilities		2,704,636			3,981,935

Notes payable -related parties-less current portion
* Includes unamortized debt discount related to warrants and beneficial conversion features of none and $645,547 at September 30, 2022 and December 31, 2021, respectively		-	*		354,453	*
Notes payable -non-related parties-less current portion
* Includes unamortized debt discount related to warrants and beneficial conversion features of none and $648,580 at September 30, 2022 and December 31, 2021, respectively		-	*		356,420	*

Total Liabilities		2,704,636			4,692,808
Stockholders' Equity (Deficit)
Preferred stock, $0.00001 par value; 16,300,000 and

SEC Form 10-Q filed by SOBR Safe Inc.