Nevada
|
|
98-0546715
|
(State
or other jurisdiction of incorporation)
|
|
(I.R.S.
Employer Identification No.)
|
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
and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405
of Regulation S-T (§232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the
registrant was required to submit and post such
files).
|
|
☒ Yes ☐ No
|
Large
accelerated filer
|
☐
|
|
Accelerated
filer
|
☐
|
Non-accelerated
filer
|
☐
|
(Do not
check if a smaller reporting company)
|
Smaller
reporting company
|
☒
|
|
|
|
|
|
|
|
|
Emerging growth company
|
☐
|
Indicate
by check mark whether the registrant is a shell company (as defined
in Rule 12b-2 of the Exchange Act).
|
|
☐ Yes ☒ No
|
PART I
- FINANCIAL INFORMATION
|
1
|
|
|
ITEM
1. FINANCIAL STATEMENTS
|
1
|
|
|
ITEM 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
16
|
|
|
ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
|
18
|
|
|
ITEM
4. CONTROLS AND PROCEDURES
|
18
|
|
|
PART II
- OTHER INFORMATION
|
19
|
|
|
ITEM
1. LEGAL PROCEEDINGS
|
19
|
|
|
ITEM
1A. RISK FACTORS
|
20
|
|
|
ITEM
2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS
|
20
|
|
|
ITEM
3. DEFAULTS UPON SENIOR SECURITIES
|
20
|
|
|
ITEM
4. MINE SAFETY DISCLOSURES
|
20
|
|
|
ITEM
5. OTHER INFORMATION
|
20
|
|
|
ITEM
6. EXHIBITS
|
20
|
|
|
SIGNATURES
|
22
|
|
|
|
|
|
Consolidated Balance Sheets as of March 31, 2017 and December 31,
2016
|
|
2
|
|
|
|
Consolidated Statements of Comprehensive Loss for the three months
ended March 31, 2017 and 2016
|
|
3
|
|
|
|
Consolidated Statements of Stockholders’ Deficiency for the
period from December 31, 2015 to March 31, 2017
|
|
4
|
|
|
|
Consolidated Statements of Cash Flows for the three months ended
March 31, 2017 and March 31, 2016
|
|
5
|
|
|
|
Notes to the Consolidated Financial Statements
|
|
6-15
|
ASSETS
|
March 31,
2017
(Unaudited)
|
December 31,
2016
|
|
|
|
Current
assets
|
|
|
Cash
|
$4,535
|
$119,804
|
Accounts
receivable
|
1,302
|
1,009
|
Prepaid
expenses
|
7,466
|
6,963
|
Total
current assets
|
13,303
|
127,776
|
|
|
|
Intangible
assets (Note 3)
|
35,000
|
35,000
|
|
|
|
TOTAL
ASSETS
|
$48,303
|
$162,776
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
|
|
|
|
|
LIABILITIES
|
|
|
Current
liabilities
|
|
|
Accounts
payable and accrued liabilities
|
1,565,962
|
1,554,350
|
Convertible
debentures (Note 10)
|
2,449,448
|
2,171,923
|
Deferred
revenue
|
6,323
|
6,323
|
|
|
|
Total
current liabilities
|
4,021,733
|
3,732,596
|
|
|
|
Convertible
debentures (Note 10)
|
402,767
|
218,964
|
|
|
|
Total
liabilities
|
4,424,500
|
3,951,560
|
|
|
|
Going
concern (Note 1)
|
|
|
Commitments
(Note 7)
|
|
|
Subsequent
events (Note 13)
|
|
|
|
|
|
STOCKHOLDERS'
DEFICIT
|
|
|
Preferred
stock, 50,000,000 shares authorized at par value of $0.0001,
21,557 (December 31, 2016 – 21,655) shares issued and
outstanding (Note 4)
|
2
|
2
|
Common
stock, 10,000,000,000 shares authorized at par value of $0.0001,
1,557,092,583 (December 31, 2016 – 1,068,031,823) shares
issued and outstanding (Note 4)
|
155,710
|
106,803
|
Additional
paid-in capital
|
10,308,707
|
9,609,198
|
Common
stock subscriptions receivable (Note 8)
|
(4,500)
|
(4,500)
|
Deficit
|
(14,836,116)
|
(13,500,287)
|
Total
Stockholders' Deficit
|
(4,376,197)
|
(3,788,784)
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
$48,303
|
$162,776
|
|
Three Months Ended March 31, 2017
$
|
Three Months Ended March 31, 2016
$
|
REVENUES
|
3,043
|
11,391
|
|
|
|
OPERATING EXPENSES
|
|
|
Accretion
and interest expense (Note 10)
|
646,264
|
608,007
|
App
hosting (Note 8)
|
135,000
|
109,292
|
Commissions
|
913
|
3,387
|
Financing
costs
|
-
|
4,863
|
General
and administrative (Note 8)
|
231,801
|
190,333
|
Product
development (Note 8)
|
50,400
|
95,121
|
Sales
and marketing
|
99,494
|
215,503
|
|
|
|
|
|
|
TOTAL OPERATING
EXPENSES
|
1,163,872
|
1,226,506
|
|
|
|
LOSS FROM
OPERATIONS
|
(1,160,829)
|
(1,215,115)
|
|
|
|
OTHER EXPENSES
|
|
|
Loss
on investment (Note 11)
|
(175,000)
|
-
|
|
|
|
NET LOSS AND COMPREHENSIVE LOSS
|
(1,335,829)
|
(1,215,115)
|
|
|
|
BASIC LOSS PER SHARE
|
(0.00)
|
(0.00)
|
|
|
|
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
|
1,298,101,187
|
256,355,680
|
|
Common # Stock
|
Common Stock Amount
|
Preferred #
|
Preferred Stock Amount
|
Additional Paid-in Capital
|
Common Stock Subscriptions
|
Deficit
|
Total
|
|
|
|
|
|
|
|
|
|
Balance
December 31, 2015
|
218,977,542
|
$21,898
|
22,165
|
$2
|
$5,697,308
|
$(4,500)
|
$(7,387,048)
|
$(1,672,340)
|
|
|
|
|
|
|
|
|
|
Shares
issued for services
|
65,465,714
|
6,547
|
—
|
—
|
231,545
|
—
|
—
|
238,092
|
|
|
|
|
|
|
|
|
|
Conversion
of convertible notes (Note 10)
|
652,069,721
|
65,207
|
—
|
—
|
311,248
|
—
|
—
|
376,455
|
|
|
|
|
|
|
|
|
|
Conversion
of preferred shares (Note 4)
|
104,524,944
|
10,452
|
(510)
|
—
|
(10,452)
|
—
|
—
|
—
|
|
|
|
|
|
|
|
|
|
Issuance
of convertible notes (net) (Note 10)
|
—
|
—
|
—
|
—
|
2,882,248
|
—
|
—
|
2,882,248
|
|
|
|
|
|
|
|
|
|
Exercise
of warrants
|
26,993,902
|
2,699
|
—
|
—
|
(2,699)
|
—
|
—
|
—
|
|
|
|
|
|
|
|
|
|
Debt
forgiveness (Note 8)
|
—
|
—
|
—
|
—
|
500,000
|
—
|
—
|
500,000
|
|
|
|
|
|
|
|
|
|
Net
loss for the year
|
—
|
—
|
—
|
—
|
—
|
—
|
(6,113,239)
|
(6,113,239)
|
|
|
|
|
|
|
|
|
|
Balance
December 31, 2016
|
1,068,031,823
|
$106,803
|
21,655
|
$2
|
$9,609,198
|
$(4,500)
|
$(13,500,287)
|
$(3,788,784)
|
Shares
issued for services
|
4,720,000
|
472
|
—
|
—
|
8,968
|
—
|
—
|
9,440
|
|
|
|
|
|
|
|
|
|
Conversion
of convertible notes (Note 10)
|
435,823,830
|
43,583
|
—
|
—
|
196,901
|
—
|
—
|
240,484
|
|
|
|
|
|
|
|
|
|
Conversion
of preferred shares (Note 4)
|
48,516,930
|
4,852
|
(98)
|
—
|
(4,852)
|
—
|
—
|
—
|
|
|
|
|
|
|
|
|
|
Issuance
of convertible notes (net) (Note 10)
|
—
|
—
|
—
|
—
|
498,492
|
—
|
—
|
498,492
|
|
|
|
|
|
|
|
|
|
Net
loss for the period
|
—
|
—
|
—
|
—
|
—
|
—
|
(1,335,829)
|
(1,335,829)
|
|
|
|
|
|
|
|
|
|
Balance
March 31, 2017
|
1,557,092,583
|
$155,710
|
21,557
|
$2
|
$10,308,707
|
$(4,500)
|
$(14,836,116)
|
$(4,376,197)
|
|
Three months ended
March 31, 2017
|
Three months ended
March 31, 2016
|
Cash Flows from Operating Activities:
|
|
|
Net
loss
|
$(1,335,829)
|
$(1,215,115)
|
|
|
|
Adjustments to Reconcile Net Loss to Net Cash Used in Operating
Activities:
|
|
|
Interest
on convertible deventures
|
110,158
|
4,382
|
Accretion
expense
|
536,106
|
564,204
|
Shares
issued for services
|
9,440
|
21,534
|
Loss
on investment
|
175,000
|
-
|
Changes in Operating Assets and Liabilities
|
|
|
Increase
in accounts receivable
|
(796)
|
1,734
|
Increase
(decrease) in accounts payable
|
(62,408)
|
193,395
|
Net Cash Used in Operating Activities
|
(568,329)
|
(429,866)
|
|
|
|
Cash Flows Used in Investing Activities:
|
|
|
Investment
in Hang With
|
(175,000)
|
-
|
Net Cash Used in Investing Activities
|
(175,000)
|
-
|
|
|
|
Cash Flows from Financing Activities:
|
|
|
Proceeds
from convertible debentures (net)
|
628,060
|
433,250
|
|
|
|
Net Cash Provided by Financing Activities
|
628,060
|
433,250
|
|
|
|
Net Increase(Decrease) in Cash
|
(115,269)
|
3,384
|
|
|
|
Cash on Hand – Beginning
|
119,804
|
15,880
|
|
|
|
Cash on Hand – Ending
|
$4,535
|
$19,264
|
|
|
|
Supplemental Cash Flow Information:
|
|
|
Cash
paid for interest
|
$—
|
$—
|
Cash
paid for income taxes
|
$—
|
$—
|
|
|
|
Non-cash Investing and Financing Items:
|
|
|
Shares
issued for conversion of debt (net)
|
$-
|
$-
|
Convertible
debentures issued to extinguish promissory notes
|
$-
|
$-
|
|
|
|
|
Number of Warrants
|
Weighted Average
Exercise Price
$
|
Balance,
December 31, 2016
|
978,335,757
|
0.005
|
Warrants
issued
|
118,000,000
|
0.003
|
Balance,
March 31, 2017
|
1,096,335,757
|
0.004
|
|
Option
Price
|
|
Expiry
Date
|
Per
Share($)
|
Number
|
December
21, 2021
|
1,680
|
1,725
|
June
21, 2022
|
400
|
500
|
June
25, 2023
|
134
|
850
|
|
$1,044
|
3,075
|
|
Number of Options
|
Weighted Average Exercise Price
|
Weighted- Average Remaining Contractual Term (years)
$
|
Aggregate Intrinsic Value
$
|
Outstanding
and exercisable, December 31, 2016
|
3,075
|
1,044
|
6.57
|
-
|
Outstanding
and exercisable, March 31, 2017
|
3,075
|
1,044
|
6.32
|
-
|
|
$
|
|
|
Employment
Agreements (1)
|
225,000
|
Conversion Feature
|
Issuance
|
Net Principal ($)
|
Discount ($)
|
Carrying Value ($)
|
Interest Rate
|
Maturity Date
|
||
a
|
)
|
02-Apr-13
|
5,054
|
-
|
5,054
|
0
|
%
|
02-Jan-14
|
b
|
)
|
05-Aug-15
|
750,000
|
-
|
750,000
|
7
|
%
|
05-Feb-17
|
b
|
)
|
05-Aug-15
|
18,750
|
-
|
18,750
|
7
|
%
|
05-Feb-17
|
d
|
)
|
17-Feb-15
|
102,135
|
-
|
102,135
|
8
|
%
|
17-Feb-16
|
d
|
)
|
17-Feb-15
|
5,000
|
-
|
5,000
|
8
|
%
|
17-Feb-16
|
c
|
)
|
27-Feb-15
|
37,500
|
-
|
37,500
|
8
|
%
|
27-Feb-16
|
d
|
)
|
19-Mar-15
|
53,551
|
-
|
53,551
|
8
|
%
|
19-Mar-16
|
d
|
)
|
19-Mar-15
|
8,000
|
-
|
8,000
|
8
|
%
|
19-Mar-16
|
c
|
)
|
11-May-15
|
50,000
|
-
|
50,000
|
8
|
%
|
10-May-16
|
d
|
)
|
02-Jun-15
|
29,500
|
-
|
29,500
|
8
|
%
|
01-Jun-16
|
d
|
)
|
02-Jun-15
|
45,966
|
-
|
45,966
|
8
|
%
|
01-Jun-16
|
d
|
)
|
02-Jun-15
|
10,000
|
-
|
10,000
|
8
|
%
|
01-Jun-16
|
d
|
)
|
02-Jun-15
|
58,540
|
-
|
58,540
|
8
|
%
|
01-Jun-16
|
d
|
)
|
02-Jun-15
|
35,408
|
-
|
35,408
|
8
|
%
|
01-Jun-16
|
d
|
)
|
02-Jun-15
|
20,758
|
-
|
20,758
|
8
|
%
|
01-Jun-16
|
c
|
)
|
11-Jun-15
|
50,000
|
-
|
50,000
|
8
|
%
|
10-Jun-16
|
d
|
)
|
16-Jun-15
|
30,464
|
-
|
30,464
|
8
|
%
|
15-Jun-16
|
d
|
)
|
19-Jun-15
|
30,000
|
-
|
30,000
|
8
|
%
|
18-Jun-16
|
d
|
)
|
19-Jun-15
|
35,408
|
-
|
35,408
|
8
|
%
|
18-Jun-16
|
c
|
)
|
24-Jun-15
|
37,500
|
-
|
37,500
|
8
|
%
|
23-Jun-16
|
d
|
)
|
24-Jun-15
|
35,000
|
-
|
35,000
|
8
|
%
|
23-Jun-16
|
c
|
)
|
24-Jun-15
|
37,500
|
-
|
37,500
|
8
|
%
|
23-Jun-16
|
d
|
)
|
07-Jul-15
|
75,000
|
-
|
75,000
|
8
|
%
|
07-Oct-15
|
d
|
)
|
01-Aug-15
|
17,408
|
-
|
17,408
|
8
|
%
|
04-Aug-16
|
d
|
)
|
01-Aug-15
|
30,000
|
-
|
30,000
|
8
|
%
|
01-Aug-16
|
d
|
)
|
01-Aug-15
|
35,408
|
-
|
35,408
|
8
|
%
|
01-Aug-16
|
d
|
)
|
21-Sep-15
|
64,744
|
-
|
64,744
|
8
|
%
|
21-Sep-16
|
b
|
)
|
03-May-16
|
50,000
|
20,752
|
29,248
|
8
|
%
|
03-May-17
|
c
|
)
|
03-May-16
|
50,000
|
-
|
50,000
|
8
|
%
|
03-May-17
|
d
|
)
|
03-May-16
|
29,500
|
-
|
29,500
|
8
|
%
|
03-May-17
|
d
|
)
|
03-May-15
|
45,965
|
-
|
45,965
|
8
|
%
|
03-May-17
|
b
|
)
|
24-May-16
|
61,571
|
34,086
|
27,485
|
8
|
%
|
24-May-17
|
d
|
)
|
24-May-16
|
30,464
|
-
|
30,464
|
8
|
%
|
24-May-17
|
b
|
)
|
26-May-16
|
157,500
|
99,735
|
57,765
|
8
|
%
|
26-May-17
|
d
|
)
|
15-Jun-16
|
50,000
|
40,528
|
9,472
|
8
|
%
|
15-Jun-17
|
b
|
)
|
02-Jun-16
|
160,000
|
138,763
|
21,237
|
7
|
%
|
02-Jun-17
|
b
|
)
|
02-Jun-16
|
4,000
|
3,138
|
862
|
7
|
%
|
02-Jun-17
|
b
|
)
|
15-Jun-16
|
50,000
|
31,417
|
18,583
|
7
|
%
|
15-Jun-17
|
b
|
)
|
15-Jun-16
|
1,250
|
858
|
392
|
7
|
%
|
15-Jun-17
|
b
|
)
|
17-May-16
|
100,000
|
83,299
|
16,701
|
7
|
%
|
08-Sep-17
|
b
|
)
|
17-May-16
|
2,500
|
1,833
|
667
|
7
|
%
|
08-Sep-17
|
b
|
)
|
19-May-16
|
110,000
|
87,775
|
22,225
|
7
|
%
|
08-Sep-17
|
b
|
)
|
19-May-16
|
2,750
|
2,045
|
705
|
7
|
%
|
08-Sep-17
|
b
|
)
|
27-Jan-16
|
248,994
|
21,354
|
227,640
|
7
|
%
|
27-Jul-17
|
b
|
)
|
08-Mar-16
|
110,000
|
92,399
|
17,601
|
7
|
%
|
08-Sep-17
|
b
|
)
|
27-Jan-16
|
13,536
|
-
|
13,536
|
7
|
%
|
27-Jul-17
|
b
|
)
|
08-Mar-16
|
5,000
|
2,466
|
2,534
|
7
|
%
|
08-Sep-17
|
b
|
)
|
08-Mar-16
|
90,000
|
70,697
|
19,303
|
7
|
%
|
08-Sep-17
|
b
|
)
|
07-Jul-16
|
50,000
|
41,477
|
8,523
|
7
|
%
|
08-Sep-17
|
b
|
)
|
04-Aug-16
|
110,000
|
97,474
|
12,526
|
7
|
%
|
08-Sep-17
|
b
|
)
|
15-Aug-16
|
157,000
|
142,277
|
14,723
|
7
|
%
|
08-Sep-17
|
b
|
)
|
12-Sep-16
|
83,000
|
74,446
|
8,554
|
7
|
%
|
08-Sep-17
|
b
|
)
|
07-Jul-16
|
1,250
|
885
|
365
|
7
|
%
|
08-Sep-17
|
b
|
)
|
04-Aug-16
|
2,750
|
2,203
|
547
|
7
|
%
|
08-Sep-17
|
b
|
)
|
15-Aug-16
|
3,925
|
3,276
|
649
|
7
|
%
|
08-Sep-17
|
b
|
)
|
12-Sep-16
|
2,075
|
1,680
|
395
|
7
|
%
|
08-Sep-17
|
b
|
)
|
04-Aug-16
|
110,000
|
94,092
|
15,908
|
7
|
%
|
04-Aug-17
|
b
|
)
|
15-Aug-16
|
157,500
|
140,232
|
17,268
|
7
|
%
|
15-Aug-17
|
b
|
)
|
08-Sep-16
|
80,000
|
71,369
|
8,631
|
7
|
%
|
08-Sep-17
|
b
|
)
|
11-Nov-16
|
80,000
|
76,361
|
3,639
|
7
|
%
|
11-Nov-17
|
b
|
)
|
06-Dec-16
|
88,000
|
85,188
|
2,812
|
7
|
%
|
06-Dec-17
|
b
|
)
|
09-Jan-17
|
84,000
|
82,346
|
1,654
|
7
|
%
|
09-Jan-18
|
b
|
)
|
03-Mar-17
|
32,000
|
31,330
|
670
|
7
|
%
|
03-Mar-18
|
c
|
)
|
02-Feb-17
|
159,750
|
158,365
|
1,385
|
8
|
%
|
02-Feb-17
|
c
|
)
|
15-Mar-17
|
96,000
|
95,280
|
720
|
8
|
%
|
15-Mar-18
|
|
|
|
|
|
|
|
|
|
|
|
|
4,378,874
|
1,929,426
|
2,449,448
|
|
|
|
|
|
Issuance
|
Net Principal ($)
|
Discount ($)
|
Carrying Value ($)
|
Interest Rate
|
Maturity Date
|
|
b
|
)
|
07-Oct-16
|
465,000
|
460,527
|
4,473
|
7
|
%
|
07-Apr-18
|
)
|
7-Nov-16
|
284,100
|
235,310
|
48,790
|
7
|
%
|
07-May-18
|
|
b
|
)
|
12-Dec-16
|
285,859
|
83,244
|
202,615
|
7
|
%
|
12-Jun-18
|
b
|
)
|
18-Jan-17
|
282,206
|
135,317
|
146,889
|
7
|
%
|
07-Apr-18
|
|
|
|
|
|
|
|
|
|
|
|
|
1,317,165
|
914,398
|
402,767
|
|
|
|
a)
|
Subsequent
to March 31, 2017, the Company issued 126,582,431 shares of common
stock in connection with conversion of shares of Series A preferred
stock.
|
b)
|
Subsequent
to March 31, 2017, the Company obtained proceeds of $82,000 for
various convertible notes agreements (“Debentures”)
entered into with face value totaling $82,000, with interest rates
at between 7% and 8% per annum and maturing twelve months from the
dates of issuance. The principal and interest of the Debentures are
convertible into common shares of the Company at various conversion
rates as outlined in each agreement. In connection with the
convertible notes, the Company also issued warrants to allow a note
holder to purchase 118,000,000 shares of Common Stock with an
exercise price of $0.003. The Company paid $9,000 in legal fees and
other expenses in connection with these debentures.
|
|
March
31, 2017
|
December
31, 2016
|
|
(unaudited)
|
(audited)
|
Current
Assets
|
$13,303
|
$127,776
|
Current
Liabilities
|
4,021,733
|
3,732,596
|
Working Capital
(Deficiency)
|
$(4,008,430)
|
$(3,604,820)
|
|
Three
months
|
Three
months
|
|
Ended
|
Ended
|
|
March 31, 2017
|
March 31, 2016
|
Net Cash Used in
Operating Activities
|
$(568,329)
|
$(429,866)
|
Net Cash Used in
Investing Activities
|
(175,000)
|
-
|
Net Cash Provided
by Financing Activities
|
628,060
|
433,250
|
Net Increase
(Decrease) in Cash
|
$(115,269)
|
$3,384
|
Exhibit Number
|
Description
|
(4)
|
Instruments defining the rights of security holders, including
indentures
|
4.1
|
8%
Convertible Note dated February 2, 2017 issued by the Company to
EMA Financial, LLC (Incorporated by reference to the Current Report
on Form 8-K, previously filed with the SEC on March 6,
2017)
|
4.2
|
8%
Convertible Note dated March 15, 2017 issued by the Company to EMA
Financial, LLC (Incorporated by reference to the Current Report on
Form 8-K, previously filed with the SEC on March 23,
2017)
|
4.3
|
8%
Convertible Redeemable Note dated March 13, 2017 issued by the
Company to Coventry Enterprises, LLC (Incorporated by reference to
the Current Report on Form 8-K, previously filed with the SEC on
March 23, 2017)
|
|
|
(10)
|
Material Contracts
|
10.1
|
Securities
Purchase Agreement dated February 2, 2017 by and between the
Company and EMA Financial, LLC (Incorporated by reference to the
Current Report on Form 8-K, previously filed with the SEC on March
6, 2017)
|
10.2
|
Securities
Purchase Agreement dated March 15, 2017 by and between the Company
and EMA Financial, LLC (Incorporated by reference to the Current
Report on Form 8-K, previously filed with the SEC on March 23,
2017)
|
10.3
|
Securities
Purchase Agreement dated March 13, 2017 by and between the Company
and Coventry Enterprises, LLC (Incorporated by reference to the
Current Report on Form 8-K, previously filed with the SEC on March
23, 2017)
|
|
|
(31)
|
Rule 13a-14(a)/15d-14(a) Certification
|
32.1+
|
Certification of the
Principal Executive Officer and Principal Financial Officer of the
Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.
|
(101)
|
XBRL
|
101.INS*
|
XBRL
INSTANCE DOCUMENT
|
101.SCH*
|
XBRL
TAXONOMY EXTENSION SCHEMA
|
101.CAL*
|
XBRL
TAXONOMY EXTENSION CALCULATION LINKBASE
|
101.DEF*
|
XBRL
TAXONOMY EXTENSION DEFINITION LINKBASE
|
101.LAB*
|
XBRL
TAXONOMY EXTENSION LABEL LINKBASE
|
101.PRE*
|
XBRL
TAXONOMY EXTENSION PRESENTATION LINKBASE
|
|
FRIENDABLE, INC.
|
|
|
|
|
|
|
Date:
May 22, 2017
|
By:
|
/s/ Robert
Rositano, Jr.
|
|
|
|
Name: Robert
Rositano, Jr.
|
|
|
|
Title:
CEO, Secretary, and Director (Principal Executive
Officer)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date:
May 22, 2017
|
By:
|
/s/ Frank
Garcia
|
|
|
|
Name:
Frank Garcia
|
|
|
|
Title:
Chief Financial Officer
(Principal
Financial Officer and Principal Accounting Officer)
|
|
|
|
|
|
1.
|
I have
reviewed this quarterly report on Form 10-Q of Friendable,
Inc.;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the
period covered by this report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in
this report;
|
4.
|
The
registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
A.
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this report is being prepared;
|
|
B.
|
Designed
such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally
accepted accounting principles;
|
|
C.
|
Evaluated
the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the
end of the period covered by this report based on such evaluation;
and
|
|
D.
|
Disclosed
in this report any change in the registrant's internal control over
financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in
the case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant's internal
control over financial reporting; and
|
5.
|
The
registrant's other certifying officer(s) and I have disclosed,
based on our most recent evaluation of internal control over
financial reporting, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons
performing the equivalent functions):
|
|
A.
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to
record, process, summarize and report financial information;
and
|
|
B.
|
Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
control over financial reporting.
|
1.
|
I have
reviewed this quarterly report on Form 10-Q of Friendable,
Inc.;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the
period covered by this report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in
this report;
|
4.
|
The
registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
A.
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this report is being prepared;
|
|
B.
|
Designed
such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally
accepted accounting principles;
|
|
C.
|
Evaluated
the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the
end of the period covered by this report based on such evaluation;
and
|
|
D.
|
Disclosed
in this report any change in the registrant's internal control over
financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in
the case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant's internal
control over financial reporting; and
|
5.
|
The
registrant's other certifying officer(s) and I have disclosed,
based on our most recent evaluation of internal control over
financial reporting, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons
performing the equivalent functions):
|
|
A.
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to
record, process, summarize and report financial information;
and
|
|
B.
|
Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
control over financial reporting.
|
|
(1)
|
the
quarterly report on Form 10-Q of the Issuer for the period ended
March 31, 2017 fully complies with the requirements of Section
13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as
amended; and
|
|
(2)
|
the
information contained in the Form 10-Q fairly presents, in all
material respects, the financial condition and results of
operations of the Issuer.
|
Document and Entity Information - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
May 17, 2017 |
|
Document And Entity Information | ||
Entity Registrant Name | Friendable, Inc. | |
Entity Central Index Key | 0001414043 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 1,683,675,014 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2017 |
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares |
Mar. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
STOCKHOLDERS' EQUITY (DEFICIT) | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, authorized shares | 50,000,000 | 50,000,000 |
Preferred stock, issued shares | 21,557 | 21,655 |
Preferred stock, outstanding shares | 21,557 | 21,655 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, Authorized | 10,000,000,000 | 10,000,000,000 |
Common stock, Issued | 1,557,092,583 | 1,068,031,823 |
Common stock, outstanding | 1,557,092,583 | 1,068,031,823 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Income Statement [Abstract] | ||
REVENUES | $ 3,043 | $ 11,391 |
OPERATING EXPENSES | ||
Accretion and interest expense (Note 10) | 646,264 | 608,007 |
App hosting (Note 8) | 135,000 | 109,292 |
Commissions | 913 | 3,387 |
Financing costs | 0 | 4,863 |
General and administrative (Note 8) | 231,801 | 190,333 |
Product development (Note 8) | 50,400 | 95,121 |
Sales and marketing | 99,494 | 215,503 |
TOTAL OPERATING EXPENSES | 1,163,872 | 1,226,506 |
LOSS FROM OPERATIONS | (1,160,829) | (1,215,115) |
OTHER EXPENSES | ||
Loss on investment (Note 11) | (175,000) | 0 |
NET LOSS AND COMPREHENSIVE LOSS | $ (1,335,829) | $ (1,215,115) |
BASIC LOSS PER SHARE | $ (0.00) | $ (0.00) |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | 1,298,101,187 | 256,355,680 |
1. NATURE OF BUSINESS AND GOING CONCERN |
3 Months Ended |
---|---|
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS AND GOING CONCERN | Friendable, Inc., a Nevada corporation (the “Company”), was incorporated in the State of Nevada as Digital Yearbook Inc.
Effective June 15, 2011, the Company completed a merger with its subsidiary, Titan Iron Ore Corp., a Nevada corporation, which was incorporated solely to effect a change in the Company’s name from “Digital Yearbook Inc.” to “Titan Iron Ore Corp.” The Company then began to pursue business in the area of mining exploration.
On February 3, 2014, the Company entered into an Agreement and Plan of Merger and Reorganization (the “Merger”) with iHookup Operations Corp., a wholly-owned Delaware subsidiary of the Company (“Acquisition Sub”) and iHookup-DE, whereby iHookup-DE was the surviving entity and became the wholly-owned subsidiary of the Company. iHookup-DE’s former stockholders exchanged all of their 6,000 shares of outstanding common stock for 25,000 shares of the Company’s designated Series A Preferred Stock.
The Merger was regarded as a reverse recapitalization whereby iHookup-DE was considered to be the accounting acquirer as its stockholders retained control of the Company after the Merger. On February 3, 2014, the Merger was completed and as a result, iHookup-DE acquired the net liabilities of the Company.
As a result of the Merger, the Company ceased its prior operations and its business became the development and dissemination of a “proximity based” mobile-social media application that facilitates connections between people, utilizing the intelligence of global positioning system and localized recommendations.
On September 28, 2015, the Company filed a Certificate of Amendment to its Articles of Incorporation changing the name of the Company from “iHookup Social, Inc.” to “Friendable, Inc.”. On October 27, 2015, the Company’s trading symbol on the OTC Pink marketplace was changed from “HKUP” to “FDBL”. This change was made in conjunction with the re-branding of the Company’s app from "iHookup Social" to "Friendable".
The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern, which implies that the Company would continue to realize its assets and discharge its liabilities in the normal course of business. The Company has never paid any dividends and is unlikely to pay dividends or generate earnings in the immediate or foreseeable future. As of March 31, 2017, the Company has a working capital deficiency of $4,008,430 and has an accumulated deficit of $14,836,116 since inception and its operations continue to be funded primarily from sales of its stock and issuance of convertible debentures. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to obtain the necessary financing through the issuance of convertible notes and equity instruments. The consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Management plans to raise financing through the issuance of convertible notes. No assurance can be given that any such additional financing will be available, or that it can be obtained on terms acceptable to the Company and its stockholders. |
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
3 Months Ended |
---|---|
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Basis of Presentation
These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. The Company’s fiscal year end is December 31.
Interim financial statements
The unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim consolidated financial information and with the instructions for Securities and Exchange Commission (“SEC”) Form 10-Q and they do not include all of the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. Therefore, these consolidated financial statements should be read in conjunction with the Company’s audited annual consolidated financial statements and notes thereto for the year ended December 31, 2016, included in the Company’s Annual Report on Form 10-K filed on April 17, 2017, with the SEC.
In the opinion of management, all adjustments (consisting of normal and recurring accruals) considered necessary for fair presentation of the Company’s financial position, results of operations and cash flows have been included. Operating results for the three months ended March 31, 2017, are not necessarily indicative of the results that may be expected for future quarters or the year ending December 31, 2017.
Use of Estimates
The preparation of these statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions related to the useful life and recoverability of long-lived assets, valuation of convertible debenture conversion options, deferred income tax asset valuations, financial instrument valuations, share-based payments, other equity-based payments, and loss contingencies. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.
Revenue Recognition
Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. The Company derives revenues from the sale of application software, unlimited messaging subscriptions for periods varying from one to twelve months, and arrangements for virtual gifts and access to special features referred to as coin packs. Revenue from the sale of application software is recognized upon download. Revenue from messaging subscriptions is recognized as revenue ratably over the subscription period beginning on the date the service is made available to customers. Revenue from coin packs is recognized on a consumption basis commensurate with the customer utilization of such resources.
Advertising Costs
The Company’s policy regarding advertising is to expense advertising when incurred. During the three months ended March 31, 2017, the Company incurred $1,397 (March 31, 2016: $158,473) in advertising costs.
Cash and Cash Equivalents
The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents.
Intangible Assets
The Company accounts for intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other. The Company assesses potential impairments to intangible assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered.
Intangible assets with finite lives are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of intangible assets with finite lives is measured by comparing the carrying amount of the asset to its fair value. If the future value of the asset is lower than its carrying value, the Company recognizes an impairment loss for the amount by which the carrying value of the asset exceeds the related estimated fair value.
Intangible assets with indefinite lives are tested for impairment annually or more frequently are tested for impairment annually or more frequently if events or changes in circumstances indicate that it is more likely than not that the intangible asset is impaired.
Impairment of Long-Lived Assets
The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows.
If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell.
Stock-based Compensation
The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Based Compensation and ASC 505, Equity Based Payments to Non-Employees, which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based awards made to employees and directors, including stock options.
ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option pricing model as its method in determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Company’s expected stock price volatility over the terms of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of comprehensive loss over the requisite service period.
All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.
Allowance for Doubtful Accounts
The Company monitors its outstanding receivables for timely payments and potential collection issues. During the three months ended March 31, 2017 and 2016, the Company did not have any allowance for doubtful accounts.
Financial Instruments
Financial assets and financial liabilities are recognized in the balance sheet when the Company has become party to the contractual provisions of the instruments.
The Company’s financial instruments consist of cash, accounts receivable, accounts payable, and convertible debentures. The fair values of these financial instruments approximate their carrying value, due to their short term nature, and current market rates for similar financial instruments. Fair value of a financial instrument is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company’s financial instruments recorded at fair value in the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value.
Basic and Diluted Loss Per Share
The Company computes net loss per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of comprehensive loss. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.
As of March 31, 2017, there were approximately 20,131,923,405 potentially dilutive shares outstanding.
Income Taxes
The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Income Taxes. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.
Recent Accounting Pronouncements
In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, “Revenue Recognition” and some cost guidance included in ASC Subtopic 605-35, Revenue Recognition -Construction-Type and Production-Type Contracts”. ASU 2014-09 requires the disclosure of sufficient information to enable users of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. The Company will also be required to disclose information regarding significant judgments and changes in judgments, and assets recognized from costs incurred to obtain or fulfill a contract. Early adoption is not allowed. ASU 2014-09 provides two methods of retrospective application. The first method would require the Company to apply ASU 2014-09 to each prior reporting period presented. The second method would require the Company to retrospectively apply with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application. The Company is currently evaluating the impact that the adoption of ASU 2014-09 may have on its consolidated financial statements.
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3. INTANGIBLE ASSETS |
3 Months Ended |
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Mar. 31, 2017 | |
Intangible Assets | |
INTANGIBLE ASSETS | As at March 31, 2017, the Company owns the Friendable Properties which includes domain names, logos, icons, and registered trademarks for which it paid cash consideration of $35,000. |
4. COMMON AND PREFERRED STOCK |
3 Months Ended |
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Mar. 31, 2017 | |
Equity [Abstract] | |
COMMON AND PREFERRED STOCK | Common Stock:
Issued during 2017
During the three months ended March 31, 2017, the Company issued 435,823,830 shares of common stock to various convertible note holders for full and partial conversion of the notes (Note 10).
During the three months ended March 31, 2017, the Company issued 4,720,000 shares of common stock to consultants as payment for finder’s fees.
During the three months ended March 31, 2017, the Company issued 48,516,930 shares of common stock to various Series A preferred stockholders on conversion of 98 preferred shares.
Preferred Stock:
The Series A Preferred Stock is convertible into nine (9) times the number of common stock outstanding until the closing of a Qualified Financing (i.e. the sale and issuance of the Company’s equity securities that results in gross proceeds in excess of $2,500,000). The number of shares of common stock issued on conversion of preferred stock is based on the ratio of the number of shares of preferred stock converted to the total number of shares of preferred stock outstanding at the date of conversion multiplied by nine (9) times the number of common stock outstanding at the date of conversion. |
5. SHARE PURCHASE WARRANTS |
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||
Notes to Financial Statements | |||||||||||||||||||||||||||||||||||||
SHARE PURCHASE WARRANTS | Details of share purchase warrants during the three months ended March 31, 2017 are:
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6. STOCK-BASED COMPENSATION |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCK-BASED COMPENSATION | On November 22, 2011, the Board of Directors of the Company. (see Note 1) approved a stock option plan (“2011 Stock Option Plan”), the purpose of which is to enhance the Company’s stockholder value and financial performance by attracting, retaining and motivating the Company’s officers, directors, key employees, consultants and its affiliates and to encourage stock ownership by such individuals by providing them with a means to acquire a proprietary interest in the Company’s success through stock ownership. Under the 2011 Stock Option Plan, officers, directors, employees and consultants who provide services to the Company may be granted options to acquire common shares of the Company. The aggregate number of options authorized by the plan shall not exceed 4,974 shares of common stock of the Company.
The following table summarizes the options outstanding and exercisable under the 2011 Stock Option Plan as of March 31, 2017:
The Board of Directors and the stockholders holding a majority of the voting power approved a 2014 Equity Incentive Plan (the “2014 Plan”) on February 28, 2014, with a to be determined effective date. The purpose of the 2014 Plan is to assist the Company and its affiliates in attracting, retaining and providing incentives to employees, directors, consultants and independent contractors who serve the Company and its affiliates by offering them the opportunity to acquire or increase their proprietary interest in the Company and to promote the identification of their interests with those of the stockholders of the Company. The 2014 Plan will also be used to make grants to further reward and incentivize current employees and others.
There are 120,679 shares of common stock reserved for issuance under the 2014 Plan. The Board shall have the power and authority to make grants of stock options to employees, directors, consultants and independent contractors who serve the Company and its affiliates. Any stock options granted under the 2014 Plan shall have an exercise price equal to or greater than the fair market value of the Company’s shares of common stock. Unless otherwise determined by the Board of Directors, stock options shall vest over a four-year period with 25% being vested after the end of one (1) year of service and the remainder vesting equally over a 36-month period. The Board may award options that may vest based upon the achievement of certain performance milestones. As of March 31, 2017, no options have been awarded under the 2014 Plan.
The following table summarizes the Company’s stock options outstanding and exercisable:
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7. COMMITMENTS |
3 Months Ended | ||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||
COMMITMENTS | The following table summarizes the Company’s significant contractual obligations as of March 31, 2017:
(1) Employment agreements with related parties.
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8. RELATED PARTY TRANSACTIONS AND BALANCES |
3 Months Ended |
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Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS AND BALANCES | During the three months ended March 31, 2017, the Company incurred $132,300 (2016: 110,862) in salaries to officers and directors with such costs being recorded as general and administrative expenses.
During the three months ended March 31, 2017, the Company incurred $200,000 (2016: $199,292) in app hosting, app development and rent to a company with two officers and directors in common with such costs being recorded as app hosting, app development and general and administrative expenses, respectively.
As of March 31, 2017, the Company had a stock subscription receivable totaling $4,500 (December 31, 2016: $4,500) from an officer and director and from a company with an officer and director in common.
As of March 31, 2017, accounts payable include $160,558 (December 31, 2016: $234,058) payable to a company with two officers and directors in common, and $222,083 (December 31, 2015: $215,000) payable in salaries to directors and officers of the Company. The amounts are unsecured, non-interest bearing and are due on demand.
During the year ended December 31, 2016, two officers forgave debt totaling $200,000 and a company controlled by two officers of the Company forgave debt totaling $300,000. The debt forgiveness was considered a capital transaction and therefore $500,000 was recorded as an increase in additional paid-in capital as of December 31, 2016.
The above transactions were recorded at their exchange amounts, being the amounts agreed by the related parties.
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9. FAIR VALUE MEASUREMENTS |
3 Months Ended |
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Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | ASC 820, Fair Value Measurements and Disclosures, require an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:
Level 1 Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Valuations are based on quoted prices that are readily and regularly available in an active market and do not entail a significant degree of judgment.
Level 2 Level 2 applies to assets or liabilities for which there are other than Level 1 observable inputs such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
Level 2 instruments require more management judgment and subjectivity as compared to Level 1 instruments. For instance: determining which instruments are most similar to the instrument being priced requires management to identify a sample of similar securities based on the coupon rates, maturity, issuer, credit rating and instrument type, and subjectively select an individual security or multiple securities that are deemed most similar to the security being priced; and determining whether a market is considered active requires management judgment.
Level 3 Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The determination of fair value for Level 3 instruments requires the most management judgment and subjectivity.
Pursuant to ASC 825, cash is based on Level 1 inputs. The Company believes that the recorded values of accounts receivable and accounts payable approximate their current fair values because of their nature or respective relatively short durations. The fair value of the Company’s convertible debentures approximates their carrying values as the underlying imputed interest rates approximates the estimated current market rate for similar instruments.
As of March 31, 2017, there were no assets or liabilities measured at fair value on a recurring basis presented on the Company’s balance sheet, other than cash. |
10. CONVERTIBLE DEBENTURES |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
CONVERTIBLE DEBENTURES | Current Convertible Debentures:
Long-term Convertible Debentures:
During the three months ended March 31, 2017, the Company received net proceeds from convertible debentures of $628,060.
During the three months ended March 31, 2017, $240,484 of convertible debentures were settled by issuing 435,823,830 shares of common stock of the Company.
During the three months ended March 31, 2017, the Company incurred $29,250 in transaction costs in connection with the issuance of the convertible debentures that have been offset against the carrying values of the related debentures on the issuance date.
During the three months ended March 31, 2017, the Company incurred $658,391 in accretion and interest expense in connection with the convertible debentures.
At March 31, 2017, convertible debentures with the principal amount of $5,583,015 are subject to a General Security Agreement covering substantially all of the Company’s assets.
The Company has evaluated whether separate financial instruments with the same terms as the conversion features above would meet the characteristics of a derivative instrument as described in paragraphs ASC 815-15-25. The terms of the contracts do not permit net settlement, as the shares delivered upon conversion are not readily convertible to cash. The Company’s trading history indicated that the shares are thinly traded and the market would not absorb the sale of the shares issued upon conversion without significantly affecting the price. As the conversion features would not meet the characteristics of a derivative instrument as described in ASC 815-15-25, the conversion features are not required to be separated from the host instrument and accounted for separately. As a result, at March 31, 2017 the conversion features and non-standard anti-dilutions provisions would not meet derivative classification.
Convertible debentures with maturity dates prior to March 31, 2017 are now due on demand. |
11. LOSS ON INVESTMENT AND INTANGIBLE ASSET |
3 Months Ended |
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Mar. 31, 2017 | |
Loss On Investment And Intangible Asset | |
LOSS ON INVESTMENT AND INTANGIBLE ASSET | On October 7, 2016, the Company entered into a Securities Purchase Agreement (the “Alpha SPA”) with Alpha Capital Anstalt (“Alpha Capital”), to issue and sell up to, in principal amount, $1,615,000 of convertible notes, payable in four tranches (the “Alpha Notes”). The first tranche of $465,000 was funded on October 7, 2016 (the “Initial Closing Date”) and the second, third, and fourth tranches of $375,000 were funded, respectively, during the first week of each of November 2016, December 2016, and January 2017 (the subsequent closing dates and, with the Initial Closing Date, each a “Closing”).
The Company used a portion of the proceeds of each Closing to purchase Series A Convertible Participating Preferred Stock of a private entity named Hang With, Inc. (“Hang With”). Alpha Capital is currently Hang With’s majority shareholder. On October 7, 2016, the Company entered into a Securities Purchase Agreement with Hang With (the “Hang With SPA”) to buy up to 330,397 shares of Hang With’s Series A Convertible Participating Preferred Stock (the “Preferred Stock”) for $750,000. On the Initial Closing Date, the Company paid $225,000 and was to receive 99,118 shares of Preferred Stock. The Company paid Hang With $175,000 on each of the subsequent three Closings. In connection with entering into the Hang With SPA, the Company and Hang With entered into a Software License Agreement (the “License Agreement”) in which Hang With is licensing the intellectual property of the Hang With apps to the Company. As part of the Hang With SPA and as compensation for the Company entering into the License Agreement and the future development agreement, Hang With was to issue 154,185 shares of Preferred Stock on the Initial Closing Date, and was to issue 100,000 shares of its common stock to the Company.
The Company attributed much of the value of Hang With to Hang With management’s representation that, in the history of its own apps, it had a certain amount of total users and a range of monthly active users. Hang With believed, prior to the Hang With SPA being signed, that, with the Company’s investment, the monthly active users would be at the higher end of the range within a short period of time. Based on these representations by management the Company believed that it could specifically market its own apps to the minimum monthly active users of the Hang With app that Hang With management’s represented existed.
The Company believes that, after the November 2016 Closing, the Hang With app was removed for a period of time from the app stores on which it appeared and that the app was shut down for a period of time. At this point, Hang With effectively had zero monthly active users. In addition, the Company was not able to utilize Hang With’s technology in the Friendable app as was contemplated by the License Agreement due to Hang With’s technology being, in the Company’s view, out of date. The Company is currently seeking to negotiate a settlement with Hang With regarding the Company’s claims against Hang With.
As of December 31, 2016 Hang With had not delivered any of the preferred or common shares to the Company. During the year ended December 31, 2016, the Company had paid Hang With $575,000 which has been written off as a loss on investment. During the three months ended March 31, 2017, the Company had paid Hang With $175,000 in connection to the fourth Closing which has been written off as a loss on investment.
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12. LOSS ON SETTLEMENT AGREEMENT |
3 Months Ended |
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Mar. 31, 2017 | |
Loss On Settlement Agreement | |
LOSS ON SETTLEMENT AGREEMENT | The Company and Joseph Canouse had been in a dispute regarding what amount, if any, was owed pursuant to a consulting agreement between the parties signed on April 1, 2014. On December 7, 2016, Mr. Canouse obtained a judgment in state court in Georgia in the amount of $82,931 and the right to garnish the Company’s bank accounts. On April 7, 2017, the Company entered into a Settlement Agreement with Mr. Canouse (the “Agreement”). Pursuant to the Agreement, the Company agreed to issue an 8% Convertible Note in the principal amount of $82,931 which was issued to an entity controlled by Mr. Canouse. Under the terms of the Agreement, in return for the issuance of the Note, Mr. Canouse will file a Consent Motion to Withdraw Judgment, dismiss all garnishments, and cease all collection activities. As of December 31, 2016, the Company recorded a loss on settlement agreement of $82,931 and accrued a corresponding liability. |
13. SUBSEQUENT EVENTS |
3 Months Ended | ||||
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Mar. 31, 2017 | |||||
Subsequent Events [Abstract] | |||||
SUBSEQUENT EVENTS |
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
3 Months Ended |
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Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. The Company’s fiscal year end is December 31. |
Interim financial statements | The unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim consolidated financial information and with the instructions for Securities and Exchange Commission (“SEC”) Form 10-Q and they do not include all of the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. Therefore, these consolidated financial statements should be read in conjunction with the Company’s audited annual consolidated financial statements and notes thereto for the year ended December 31, 2016, included in the Company’s Annual Report on Form 10-K filed on April 17, 2017, with the SEC.
In the opinion of management, all adjustments (consisting of normal and recurring accruals) considered necessary for fair presentation of the Company’s financial position, results of operations and cash flows have been included. Operating results for the three months ended March 31, 2017, are not necessarily indicative of the results that may be expected for future quarters or the year ending December 31, 2017. |
Use of Estimates | The preparation of these statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions related to the useful life and recoverability of long-lived assets, valuation of convertible debenture conversion options, deferred income tax asset valuations, financial instrument valuations, share-based payments, other equity-based payments, and loss contingencies. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. |
Revenue Recognition | Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. The Company derives revenues from the sale of application software, unlimited messaging subscriptions for periods varying from one to twelve months, and arrangements for virtual gifts and access to special features referred to as coin packs. Revenue from the sale of application software is recognized upon download. Revenue from messaging subscriptions is recognized as revenue ratably over the subscription period beginning on the date the service is made available to customers. Revenue from coin packs is recognized on a consumption basis commensurate with the customer utilization of such resources.
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Advertising Costs | The Company’s policy regarding advertising is to expense advertising when incurred. During the three months ended March 31, 2017, the Company incurred $1,397 (March 31, 2016: $158,473) in advertising costs.
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Cash and Cash Equivalents | The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents. |
Intangible Assets | The Company accounts for intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other. The Company assesses potential impairments to intangible assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered.
Intangible assets with finite lives are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of intangible assets with finite lives is measured by comparing the carrying amount of the asset to its fair value. If the future value of the asset is lower than its carrying value, the Company recognizes an impairment loss for the amount by which the carrying value of the asset exceeds the related estimated fair value.
Intangible assets with indefinite lives are tested for impairment annually or more frequently are tested for impairment annually or more frequently if events or changes in circumstances indicate that it is more likely than not that the intangible asset is impaired. |
Impairment of Long-Lived Assets | The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows.
If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell.
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Stock-based Compensation | The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Based Compensation and ASC 505, Equity Based Payments to Non-Employees, which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based awards made to employees and directors, including stock options.
ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option pricing model as its method in determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Company’s expected stock price volatility over the terms of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of comprehensive loss over the requisite service period.
All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. |
Allowance for Doubtful Accounts | The Company monitors its outstanding receivables for timely payments and potential collection issues. During the three months ended March 31, 2017 and 2016, the Company did not have any allowance for doubtful accounts. |
Financial Instruments | Financial assets and financial liabilities are recognized in the balance sheet when the Company has become party to the contractual provisions of the instruments.
The Company’s financial instruments consist of cash, accounts receivable, accounts payable, and convertible debentures. The fair values of these financial instruments approximate their carrying value, due to their short term nature, and current market rates for similar financial instruments. Fair value of a financial instrument is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company’s financial instruments recorded at fair value in the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value. |
Basic and Diluted Loss Per Share | The Company computes net loss per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of comprehensive loss. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.
As of March 31, 2017, there were approximately 20,131,923,405 potentially dilutive shares outstanding. |
Income Taxes | The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Income Taxes. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized. |
Recent Accounting Pronouncements | In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, “Revenue Recognition” and some cost guidance included in ASC Subtopic 605-35, Revenue Recognition -Construction-Type and Production-Type Contracts”. ASU 2014-09 requires the disclosure of sufficient information to enable users of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. The Company will also be required to disclose information regarding significant judgments and changes in judgments, and assets recognized from costs incurred to obtain or fulfill a contract. Early adoption is not allowed. ASU 2014-09 provides two methods of retrospective application. The first method would require the Company to apply ASU 2014-09 to each prior reporting period presented. The second method would require the Company to retrospectively apply with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application. The Company is currently evaluating the impact that the adoption of ASU 2014-09 may have on its consolidated financial statements. |
5. SHARE PURCHASE WARRANTS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||
Notes to Financial Statements | |||||||||||||||||||||||||||||||||||||
Share Purchase Warrants |
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6. STOCK-BASED COMPENSATION (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options outstanding |
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Stock option activity |
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7. COMMITMENTS (Tables) |
3 Months Ended | ||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||
Commitments Tables | |||||||||||||||||||||
Commitments |
(1) Employment agreements with related parties. |
10. CONVERTIBLE DEBENTURES (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Short Term Convertible Debt |
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Long-term Convertible Debt |
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1. NATURE OF BUSINESS AND GOING CONCERN (Details Narrative) - USD ($) |
Mar. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Working Capital Deficiency | $ (4,008,430) | |
Accumulated deficit | $ (14,836,116) | $ (13,500,287) |
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Accounting Policies [Abstract] | ||
Advertising costs | $ 1,397 | $ 158,473 |
Allowance for doubtful accounts | $ 0 | |
Potentially dilutive shares outstanding | 20,131,923,405 |
5. SHARE PURCHASE WARRANTS - Share Purchase Warrants (Details) - Warrants |
3 Months Ended |
---|---|
Mar. 31, 2017
$ / shares
shares
| |
Beginning Balance | shares | 978,335,757 |
Warrants issued during the period | shares | 118,000,000 |
Number of Warrants Outstanding | shares | 1,096,335,757 |
Weighted Average beginning balance | $ / shares | $ .005 |
Weighted Average Warrants issued during the period | $ / shares | .003 |
Weighted Average Exercise Price Outstanding, Ending | $ / shares | $ .004 |
6. STOCK-BASED COMPENSATION - Stock option activity (Details) |
3 Months Ended |
---|---|
Mar. 31, 2017
USD ($)
shares
| |
Number | shares | 3,075 |
Option price per share | $ | $ 1,044 |
Stock Option 1 | |
Number | shares | 1,725 |
Option price per share | $ | $ 1,680 |
Expiration date | Dec. 21, 2021 |
Stock Option 2 | |
Number | shares | 500 |
Option price per share | $ | $ 400 |
Expiration date | Jun. 21, 2022 |
Stock Option 3 | |
Number | shares | 850 |
Option price per share | $ | $ 134 |
Expiration date | Jun. 25, 2023 |
6. STOCK-BASED COMPENSATION (Details) - USD ($) |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2017 |
Dec. 31, 2016 |
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Stock-based Compensation Details | ||
Stock options of the Company outstanding and exercisable | 3,075 | 3,075 |
Weighted average exercise price stock options of the Company outstanding and exercisable | $ 1,044 | $ 1,044 |
Weighted-average remaining contractual term (years) | 6 years 3 months 25 days | 5 years 6 months 25 days |
Aggregate intrinsic value of share outstanding and exercisable | $ 0 | $ 0 |
7. COMMITMENTS (Details) |
Mar. 31, 2017
USD ($)
|
|||
---|---|---|---|---|
Commitments and Contingencies Disclosure [Abstract] | ||||
Contractual obligations | $ 225,000 | [1] | ||
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8. RELATED PARTY TRANSACTIONS AND BALANCES (Details Narrative) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Stock subscription receivable | $ 4,500 | $ 4,500 |
Officers and Directors | ||
Salaries payable | 132,300 | 110,862 |
Related party accounts payable | 222,083 | 215,000 |
Company with two officers and directors in common | ||
App hosting | 200,000 | 199,292 |
Related party accounts payable | $ 160,558 | $ 234,058 |
10. CONVERTIBLE DEBENTURES (Details 1) |
3 Months Ended |
---|---|
Mar. 31, 2017
USD ($)
| |
Convertible Debt 1 | |
Issuance | Oct. 07, 2016 |
Maturity Date | Apr. 07, 2018 |
Convertible Debt 2 | |
Issuance | Nov. 07, 2016 |
Net Principal | $ 284,100 |
Discount | 235,310 |
Carrying Value | $ 48,790 |
Interest Rate | 7.00% |
Maturity Date | May 07, 2018 |
Convertible Debt 3 | |
Issuance | Dec. 12, 2016 |
Net Principal | $ 285,859 |
Discount | 83,244 |
Carrying Value | $ 202,615 |
Interest Rate | 7.00% |
Maturity Date | Jun. 12, 2018 |
Convertible Debt 4 | |
Issuance | Jan. 18, 2017 |
Net Principal | $ 282,206 |
Discount | 135,317 |
Carrying Value | $ 146,889 |
Interest Rate | 7.00% |
Maturity Date | Apr. 07, 2018 |
Convertible Debt 1 | |
Net Principal | $ 465,000 |
Discount | 460,527 |
Carrying Value | $ 4,473 |
Interest Rate | 7.00% |
Total Convertible Debt | |
Net Principal | $ 1,317,165 |
Discount | 914,398 |
Carrying Value | $ 402,767 |
10. CONVERTIBLE DEBENTURES (Details Narrative) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Debt Disclosure [Abstract] | ||
Proceeds from convertible debentures | $ 628,060 | $ 433,250 |
Convertible debentures settle | 435,823,830 | |
Transaction costs | $ 29,250 | |
Accretion and interest expense | 658,391 | |
Principal amount | $ 5,583,015 |
11. LOSS ON INVESTMENT AND INTANGIBLE ASSET (Details Narrative) - USD ($) |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
Dec. 31, 2016 |
|
Loss On Investment And Intangible Asset Details Narrative | |||
Loss on investment | $ 175,000 | $ 0 | $ 575,000 |
12. LOSS ON SETTLEMENT AGREEMENT (Details Narrative) |
12 Months Ended |
---|---|
Dec. 31, 2016
USD ($)
| |
Loss On Settlement Agreement Details Narrative | |
Loss on settlement agreement | $ 82,931 |
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