10-Q

U. S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2018

¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission File No. 000-53462

VNUE, INC.

(Name of Registrant in its Charter)

Nevada	98-0543851
(State of Other Jurisdiction of incorporation or organization)	(I.R.S. Employer I.D. No.)

104 West 29th Street, 11th Floor, New York, NY 10001

(Address of Principal Executive Offices)

(833) 937-5493

(Registrant’s telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Sections 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 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 (§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, smaller reporting company, or an emerging growth company. See 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	x
		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 x

The number of shares of registrant’s common stock outstanding as of November 16, 2018 was 100,485,816.

FORM 10-Q

VNUE, INC.

SEPTEMBER 30, 2018

TABLE OF CONTENTS

		PAGE
PART I - FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (Unaudited)	3
Item 2.	Management Discussion & Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	26
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 3.	Defaults Upon Senior Securities	28
Item 4.	Mining Safety Disclosures	28
Item 5	Other information	28
Item 6.	Exhibits	29
SIGNATURES		30

2

PART I - FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements.

VNUE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	September 30, 2018			December 31, 2017
	(Unaudited)
Assets
Current Assets
Cash	$	39,389		$	10,278
Prepaid expenses		2,667			667
Total current assets		42,056			10,945
Intangible assets, net		491,989			320,833
Total assets	$	534,045		$	331,778
Liabilities and Stockholders’ Deficit
Current Liabilities
Accounts payable and accrued expenses	$	652,082		$	660,506
Accrued payroll		138,825			508,460
Purchased liabilities		234,487			-
Advances from stockholders		14,720			14,720
Note payable to officer		-			74,131
Notes payable		9,000			9,000
Convertible notes payable, net		994,331			617,725
Convertible notes payable, related parties, net		30,000			30,000
Derivative liabilities		865,841			866,873
Total current liabilities		2,939,286			2,781,415
Purchase liability		300,000			300,000
Total liabilities		3,239,286			3,081,415
Commitment and Contingencies
Stockholders’ Deficit
Preferred stock, par value $0.0001: 20,000,000 shares authorized; none issued		-			-
Common stock, par value $0.0001: 750,000,000 shares authorized; 95,485,816 and 74,335,070 shares issued and outstanding, respectively		9,549			7,433
Additional paid-in capital		6,407,535			4,755,719
Common stock to be issued, 3,404,352 shares and 6,537,352 shares, respectively		238,491			932,734
Accumulated deficit		(9,360,816	)		(8,445,523	)
Total Stockholders’ Deficit		(2,705,241	)		(2,749,637	)
Total Liabilities and Stockholders’ Deficit	$	534,045		$	331,778

See accompanying notes to the condensed consolidated financial statements.

3

VNUE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

	For the Three Months Ended September 30, 2018			For the Three Months Ended September 30, 2017			For the Nine Months Ended September 30, 2018			For the Nine Months Ended September 30, 2017
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Revenues	$	14,370		$	-		$	35,194		$	37,825
Operating Expenses
Direct costs of revenues		30,660			-			68,062			35,151
Research and development		2,538			24,778			17,711			92,905
General and administrative		317,875			172,319			731,323			631,057
Total operating expenses		351,073			197,097			817,096			759,113
Loss from Operations		(336,703	)		(197,097	)		(781,902	)		(721,288	)
Other income/(expenses)
Change in fair value of derivative liability		(17,120	)		57,467			390,129			38,068
Gain on extinguishment of derivative liability		76,326			174,529			110,855			292,838
Loss on settlement of convertible note payable		(70,000	)		-			(114,248	)		-
Gain on settlement of obligations		-			-			41,112			-
Financing costs		(207,599	)		(342,708	)		(561,239	)		(691,144	)
Other expenses, net		(218,393	)		(110,712	)		(133,391	)		(360,238	)
Net loss	$	(555,096	)	$	(307,809	)	$	(915,293	)	$	(1,081,526	)
Net loss per share - Basic and diluted	$	(0.01	)	$	(0.00	)	$	(0.01	)	$	(0.01	)
Weighted average common shares outstanding - Basic and diluted		92,763,805			73,919,059			85,058,114			72,205,256

See accompanying notes to the condensed consolidated financial statements.

4

VNUE, INC.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT (UNAUDITED)

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2018

	Common Stock				Additional Paid-In		Shares to be			Accumulated			Total Stockholders’
	Shares		Amount		Capital		Issued			Deficit			Deficit
Balance, December 31, 2017		74,335,070	$	7,433	$	4,755,719	$	932,734		$	(8,445,523	)	$	(2,749,637	)
Fair value of warrants and beneficial conversion feature related to convertible notes payable recorded as debt discount in settlement of accrued payroll		-		-		40,367		-			-			40,367
Gain on extinguishment of accrued payroll to officers/shareholders recorded as contributed capital		-		-		419,003		-			-			419,003
Shares issued for shares to be issued		3,813,000		381		707,514		(707,895	)		-			-
Shares issued in settlement of a note payable and accrued payroll to officers		3,746,660		375		74,558		-			-			74,933
Shares issued in settlement of accounts payable		5,616,086		562		160,421		-			-			160,983
Shares issued for services		1,300,000		130		32,370		13,652			-			46,152
Shares issued on conversion of notes payable		4,400,000		440		149,560		-			-			150,000
Shares issued for acquisition		2,275,000		228		68,022		-			-			68,250
Net loss		-		-		-		-			(915,293	)		(915,293	)
Balance, September 30, 2018 (Unaudited)		95,485,816	$	9,549	$	6,407,535	$	238,491		$	(9,360,816	)	$	(2,705,241	)

See accompanying notes to the condensed consolidated financial statements.

5

VNUE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Nine Months Ended September 30,
	2018			2017
	(Unaudited)			(Unaudited)
Cash Flows From Operating Activities
Net loss	$	(915,293	)	$	(1,081,526	)
Adjustments to reconcile net loss to net cash used in operating activities:
Change in fair value of derivative liabilities		(390,129	)		(38,068	)
Derivative value in excess of convertible notes considered a financing cost		173,302			291,702
Gain on extinguishment of derivative liability		(110,855	)		(292,838	)
Gain on settlement of vendor obligations		(41,111	)		-
Loss on extinguishment of debt		114,248			-
Amortization of debt discount		309,513			265,828
Amortization of intangible asset		131,581			-
Beneficial conversion feature on conversion of note		-			65,855
Original issue discount on convertible note payable		-			9,000
Shares issued for services		46,152			95,125
Changes in operating assets and liabilities:
Prepaid expense		(2,000	)		(2,667	)
Accounts payable and accrued expenses		217,283			163,707
Accrued payroll		50,170			205,125
Net Cash Used in Operating Activities		(417,139	)		(318,757	)
Cash Flows From Financing Activities
Proceeds from issuance of convertible notes payable		446,250			407,000
Repayment of convertible notes payable		-			(33,000	)
Net Cash Provided by Financing Activities		446,250			374,000
Net Change in Cash		29,111			55,243
Cash – Beginning of the Reporting Period		10,278			17,952
Cash – End of the Reporting Period	$	39,389		$	73,195
Supplemental Disclosure of Cash Flow Information:
Interest Paid	$	-		$	-
Income Tax Paid	$	-		$	-
Non-Cash Financing Activities
Common shares issued upon conversion of notes payable and accrued interest	$	35,752		$	63,521
Common shares issued upon conversion of accounts payable and accrued expenses	$	160,983		$	-
Common shares issued upon conversion of accrued payroll	$	74,933		$	-
Convertible note issued in settlement of accounts payable	$	15,000		$	-
Return of common shares by officer	$	-		$	(500	)
Fair value of derivative created upon issuance of convertible notes payable recorded as debt discount	$	326,650		$	311,000
Fair value of warrants and beneficial conversion feature related to convertible notes payable recorded as debt discount	$	40,367		$	-
Fair value of common shares issued and liabilities assumed upon the acquisition of Soundstr	$	302,737		$	-
Capital contribution upon conversion of accrued payroll for officers/shareholders	$	419,003		$	-

See accompanying notes to the condensed consolidated financial statements.

6

VNUE, INC.

 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017 (UNAUDITED)

NOTE 1 – BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of VNUE, Inc. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all normal recurring adjustments considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018.

History and Organization

VNUE, Inc. (formerly Tierra Grande Resources, Inc.) (“VNUE”, “TGRI”, or the “Company”) was incorporated under the laws of the State of Nevada on April 4, 2006.

On May 29, 2015, VNUE, Inc. entered into a merger agreement with VNUE Washington, Inc. Pursuant to the terms of the Merger Agreement, all of the outstanding shares of any class or series of VNUE Washington were exchanged for an aggregate of 50,762,987 shares of TGRI common stock. As a result of the Merger, VNUE Washington became a wholly-owned subsidiary of the Company, and the transaction was accounted for as a reverse merger with VNUE Washington deemed the acquiring company for accounting purposes, and the Company deemed the legal acquirer.

Overview of Business

The Company is developing a technology driven solution for Artists, Venues and Festivals to automate the capturing, publishing and monetization of their content.

Going Concern

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying condensed consolidated financial statements, during the nine months ended September 30, 2018, the Company incurred a net loss of $915,293, used cash in operations of $417,139, and had a stockholders’ deficit of $2,705,241 as of September 30, 2018. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date of the financial statements being issued. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to raise additional funds and implement its business plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s December 31, 2017 consolidated financial statements, has raised substantial doubt about the Company’s ability to continue as a going concern.

At September 30, 2018, the Company had cash on hand in the amount of $39,389. Subsequent to September 30, 2018, the Company received additional borrowings of $134,500 (see Note 10). Management estimates that the current funds on hand will be sufficient to continue operations through December 2018. The continuation of the Company as a going concern is dependent upon its ability to obtain necessary debt or equity financing to continue operations until it begins generating positive cash flow. No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing or cause substantial dilution for our stock holders, in case or equity financing.

7

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Consolidation

The Company consolidates all wholly owned and majority-owned subsidiaries in which the Company’s power to control exists. The Company consolidates the following subsidiaries and/or entities:

Name of consolidated subsidiary or Entity	State or other jurisdiction of incorporation or organization	Date of incorporation or formation (date of acquisition/disposition, if applicable)	Attributable interest
VNUE Inc. (formerly TGRI)	The State of Nevada	April 4, 2006 (May 29, 2015)		100	%
VNUE Inc. (VNUE Washington)	The State of Washington	October 16, 2014		100	%
VNUE LLC	The State of Washington	August 1, 2013 (December 3, 2014)		100	%
VNUE Technology Inc.	The State of Washington	October 16, 2014		90	%
VNUE Media Inc.	The State of Washington	October 16, 2014		89	%

VNUE Technology, Inc. and VNUE Media, Inc. were inactive corporations at September 30, 2018 and 2017, respectively. Inter-company balances and transactions have been eliminated.

Revenue Recognition

Effective January 1, 2018, the Company adopted the guidance of Accounting Standards Codification (“ASC”) 606, Revenue from Contracts. The implementation of ASC 606 did not have a material impact on the Company’s condensed consolidated financial statements. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients.

The Company recognizes revenue on the sale of digital video disks (DVD) that contain the recording of live concerts and made available to concert viewers immediately after the show and on-line. Revenue is recognized on the sale of a product when the risk of loss transfers to our customers, and collection of the receivable is reasonably assured, which generally occurs when the product is purchased.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the U.S requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the financial statement date, and reported amounts of revenue and expenses during the reporting period. Significant estimates include the assumptions used to value the derivative liabilities, the valuation allowance for the deferred tax asset and the accruals for potential liabilities. Actual results could differ from these estimates.

Fair Value of Financial Instruments

The Company determines the fair value of its assets and liabilities based on the exchange price in U.S. dollars that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company uses a fair value hierarchy with three levels of inputs, of which the first two are considered observable and the last unobservable, to measure fair value:

8

· Level 1 — Quoted prices in active markets for identical assets or liabilities.

· Level 2 — Inputs, other than Level 1, that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

· Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The carrying amounts of financial instruments such as cash, and accounts payable and accrued liabilities, approximate the related fair values due to the short-term maturities of these instruments.

The fair value of the derivative liabilities of $865,841 and $866,873 at September 30, 2018 and December 31, 2017, respectively, were valued using Level 2 inputs.

Derivative Financial Instruments

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the condensed consolidated statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date.

Loss per Common Share

Basic earnings (loss) per share are computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of shares of Common Stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation if their effect is antidilutive.

For the nine months ended September 30, 2018 and 2017, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an anti-dilutive effect. As of September 30, 2018 and 2017, we excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from our calculation of earnings per share, as their effect would have been anti-dilutive.

	September 30,
	2018		2017
Convertible Notes Payable		83,918,108		110,015,835
Warrants		8,004,708		1,000,000
Total		91,922,816		111,015,835

Intangible Assets

The Company accounts for intangible assets in accordance with the authoritative guidance issued by the FASB. Intangibles are valued at their fair market value and are amortized taking into account the character of the acquired intangible asset and the expected period of benefit. The Company evaluates intangible assets for impairment, at a minimum, on an annual basis and whenever events or changes in circumstances indicate that the carrying value may not be recoverable from its estimated undiscounted future cash flows. Recoverability of intangible assets is measured by comparing their net book value to the related projected undiscounted cash flows from these assets, considering a number of factors, including past operating results, budgets, economic projections, market trends and product development cycles. If the net book value of the asset exceeds the related undiscounted cash flows, the asset is considered impaired, and a second test is performed to measure the amount of impairment loss.

9

The Company had intangible assets with a carrying value of $491,989 and $320,833 as of September 30, 2018 and December 31, 2017, respectively. In accordance with ASC Topic 350 – Goodwill and Other Intangible Assets, the Company assesses the carrying value of its intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable and records an impairment charge if the carrying value of such intangible assets is not recoverable and if it exceeds its fair value. While our fiscal year-to-date financial performance has not met our expectations, and the enterprise value of the Company based on the current price of our common stock may fluctuate at or near the recorded level of finite-lived intangible assets, management does not consider these to be events requiring the performance of an impairment test. The Company will continue to monitor its operating results for indicators of impairment and perform additional tests as necessary, which could result in an impairment charge to intangible assets.

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-02, Leases. ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months. ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is in the process of evaluating the impact of ASU 2016-02 on the Company’s financial statements and disclosures.

In July 2017, the FASB issued ASU No. 2017-11, “Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features; (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception” (“ASU 2017-11”). ASU 2017-11 allows companies to exclude a down round feature when determining whether a financial instrument (or embedded conversion feature) is considered indexed to the entity’s own stock. As a result, financial instruments (or embedded conversion features) with down round features may no longer be required to be accounted for as derivative liabilities. A company will recognize the value of a down round feature only when it is triggered, and the strike price has been adjusted downward. For equity-classified freestanding financial instruments, an entity will treat the value of the effect of the down round as a dividend and a reduction of income available to common shareholders in computing basic earnings per share. For convertible instruments with embedded conversion features containing down round provisions, entities will recognize the value of the down round as a beneficial conversion discount to be amortized to earnings. ASU 2017-11 is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The guidance in ASU 2017-11 can be applied using a full or modified retrospective approach. The Company is currently evaluating the impact of the adoption of ASU 2017-11 on the Company’s financial statement presentation or disclosures.

In September 2018, the FASB issued ASU 2018-07, “Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting.” The ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The ASU also clarifies that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Revenue from Contracts with Customers (Topic 606). The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted. The Company is currently assessing the effect that the ASU will have on our financial position, results of operations, and disclosures.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements.

NOTE 3 – INTANGIBLE ASSETS AND PURCHASE LIABILITY

Intangible assets as of September 30, 2018 and December 31, 2017, consist of the following:

	As of
	September 30,			December 31,
	2018			2017
Intangible assets	$	652,737		$	350,000
Accumulated amortization		(160,748	)		(29,167	)
Intangible assets, net	$	491,989		$	320,833

10

Asset Acquisition – Set.fm

On October 16, 2017, the Company entered into an agreement with PledgeMusic, Inc. (the “Seller”), whereby the Company acquired the digital live music distribution platform “Set.fm” from PledgeMusic. Additionally, the Company will offer PledgeMusic North America’s full suite of music business tools allowing artists to sell music, merchandise and live experiences directly to fans, enhancing the Company’s clients’ revenue opportunities on a shared revenue basis. Set.fm is a do-it-yourself (DIY) platform that makes it easy for artists to record and sell their live shows directly to fans’ mobile devices, uploading simultaneously with their performance. The platform, which also features an innovative and easy-to-use studio app, already boasts thousands of artists and tens of thousands of fans using it. VNUE plans to update and improve the existing platform for indie artists and their fans, and to implement pro features for artists that VNUE and its affiliate DiscLive produce. The Company determined that the acquisition of Set.fm constituted the acquisition of an asset for accounting purposes.

The purchase price for the acquisition was comprised of $50,000 paid in cash, and a purchase liability of $300,000, for an aggregate purchase price of $350,000. The purchase liability is payable on the net revenues derived from VNUE’s live recording and content business and must be paid in full to the Seller no later than the three (3) year anniversary of the date of the agreement, or October 16, 2020. If the Company fails to pay the Seller the purchase liability on time, the Seller may request at any time within one hundred eighty days (180) days following the (3) year anniversary of the asset purchase agreement, that the Company immediately forfeit, convey, assign and transfer to the Seller all or any of the Purchased Assets so requested by the Seller for no additional consideration. As of September 30, 2018, there was no net revenue derived from the acquired assets and accordingly, no payments were made on the earnout.

The Company assigned the purchase price of $350,000 to intellectual property which will be amortized over a three (3) year period. Total amortization expense during the three and nine months ended September 30, 2018, was $29,167 and $87,501, respectively, which is included in general and administrative expense in the Condensed Consolidated Statements of Operations.

Asset Acquisition - Soundstr

On April 23, 2018, the Company entered into an agreement with MusicPlay Analytics, LLC (d/b/a Soundstr) (“Soundstr”) whereby the Company acquired the assets of Soundstr, a technology that aims to help businesses pay fairer music license fees based on actual music usage. The Company purchased the assets of Soundstr by agreeing to issue 2,275,000 shares of the Company’s common stock, valued at $68,250, based on the closing market price of the Company’s stock on the date of the agreement, and the Company agreed to assume and pay $234,487 of identified Soundstr obligations within 60 days of April 23, 2018. The assumed Soundstr obligations of $234,487 were outstanding as of September 30, 2018.

The Company assigned the aggregate purchase price of $302,737 to intellectual property which will be amortized over a three (3) year period. Total amortization expense during both the three and nine months ended September 30, 2018, was $25,228 and $44,080, respectively, which is included in general and administrative expense in the Condensed Consolidated Statements of Operations.

NOTE 4 – RELATED PARTY TRANSACTIONS

DiscLive Network

On July 10, 2017, the Company entered into a Licensing Agreement with RockHouse Live Media Productions, Inc., DBA “DiscLive” or “DiscLive Network” (“DiscLive”) to formalize the terms of the Strategic Alliance entered into by the Company with DiscLive on July 21, 2016. VNUE has acquired an exclusive license from DiscLive, for a period of three years unless earlier terminated under the Agreement, for the use of all its assets, including but not limited to the DiscLive brand, website (including eCommerce platform), intellectual property, inventory, equipment, trade secrets and anything related to its business of “instant live” recording. Under the terms of the Agreement, DiscLive granted the Company a worldwide exclusive license. In exchange for the license, DiscLive will receive a license fee equal to five percent (5%) of any sales derived from the sale and use of the products and services. DiscLive is controlled by our Chief Executive Officer. Revenues of $35,194 and $37,825 and direct cost of revenues of $68,062 and $35,151 during the nine months ended September 30, 2018 and 2017, respectively, were recorded using the assets licensed under this agreement.

11

Advances from Stockholders / Employees

From time to time, employees of the Company advance funds to the Company for working capital purposes. The advances are unsecured, non-interest bearing and due on demand. As of September 30, 2018 and December 31, 2017, the advances from the employees were $14,720 and $14,720, respectively.

Note payable to President and Significant Stockholder

On December 31, 2014 the Company entered into a note payable agreement with its President, and significant stockholder of the Company. The note is unsecured, non-interest bearing and due on December 31, 2024. As of December 31, 2017, the note payable balance to the officer was $74,131. On April 9, 2018, the Company and its President entered into a conversion and cancellation of debt agreement in which the Company issued common shares for payment in full and the note was retired (see Note 8).

Transactions with Louis Mann

On August 26, 2015, the Company entered into an Advisory Agreement with Louis Mann (“MANN”), a former officer and director with the Company who resigned as an officer and director on August 26, 2015. The Advisory Agreement provided for MANN’s continued and ongoing advisory services to the Company until December 31, 2015 and MANN was to be paid $25,000 for providing such advisory services, which was due and payable on or before December 31, 2015.

On September 15, 2017, the Company entered into a new Advisory Agreement with MANN. The Advisory Agreement provides for MANN’s continued and ongoing advisory services to the Company for a period of nine (6) months and with automatic nine (6) months renewals, unless terminated in accordance with the agreement. MANN is to receive $5,000 per month and 20,000 shares of common stock per month.

As of December 31, 2017, $32,500 of cash compensation was owed to MANN under the Advisory Agreements and included in accounts payable and accrued expenses. On April 5, 2018, the Company and MANN entered into a conversion and cancellation of debt agreement relating to the $32,500 cash compensation balance outstanding at December 31, 2017. The Company issued 650,000 shares of common stock, at $0.02 per share, as payment in full for the $32,500 balance outstanding at December 31, 2017 (see Note 8).

During the nine months ended September 30, 2018 and 2017, the Company incurred costs of $45,000 and $0, respectively, relating to these agreements. As of September 30, 2018, $27,500 of compensation is owed to MANN and included in accounts payable and accrued expenses.

NOTE 5 – NOTE PAYABLE (IN DEFAULT)

On December 17, 2015, the Company issued a Promissory Note in the principal amount of $9,000. The note is due within 10 business days of the Company receiving a notice of effectiveness of its Form S-1 filed on February 22, 2016. Failure to make payment during that 10 business day period shall constitute an Event of Default, as a result of which the note will become immediately due and payable and the balance will bear interest at 7%. The Company’s Form S-1 was declared effective on March 8, 2016 and payment was due before March 22, 2016. The Company did not repay the note before March 22, 2016; therefore, the note is in default with an interest rate of 7%. The balance of the note payable outstanding was $9,000 as of September 30, 2018 and December 31, 2017, respectively.

12

NOTE 6 – CONVERTIBLE NOTES PAYABLE

Convertible notes payable consist of the following:

		As of
		September 30,			December 31,
		2018			2017
Various Convertible Notes	(a)	$	45,000		$	55,000
Ylimit, LLC Convertible Notes	(b)		707,500			517,000
Crossover Capital Fund II, LLC Convertible Notes	(c)		82,360			61,000
Golock Capital, LLC Convertible Notes	(d)		231,750			191,750
DBW Investments	(e)		56,000			21,000
Black Ice Advisors	(f)		57,750			-
Power Up Lending Group	(g)		98,000			-
2 Doors	(h)		15,000			-
Total Convertible Notes			1,293,360			845,750
Discount			(269,029	)		(198,025	)
Convertible notes, net		$	1,024,331		$	647,725

_____________

(a)

In August 2014 the Company issued a series of convertible notes with various interest rates ranging up to 10% per annum. The Note Conversion Price is determined as follows: (a) if the Note is converted upon the Next Equity Financing, an amount equal to 80% of the price paid per share paid by the investors in the Next Equity Financing; (b) if the Note is converted in the event of a Corporate Transaction, a price per share derived by dividing a “pre-money” valuation of $8,000,000 by the number of shares outstanding immediately prior to the time of such conversion, on a fully diluted basis; or (c) if the Note is converted as part of a Maturity Conversion, a price per unit derived by dividing a “pre-money” valuation of $8,000,000 by the total number of units (restricted and non-restricted) outstanding immediately prior to the time of such conversion, on a fully diluted basis. The notes are due and payable on demand at any time after the earlier of (i) 36 months following the note issuance or (ii) the consummation of a corporate transaction if not previously converted. The balance of the notes outstanding was $55,000 as of December 31, 2017. On April 8, 2018, a note holder elected to convert a $10,000 convertible note plus outstanding accrued interest of $3,652 into 200,000 shares of the Company’s common at $0.02 per share (see Note 8). The balance of the notes outstanding was $45,000 as of September 30, 2018, of which $30,000 was due to related parties.

(b)

On May 9, 2016 the Company issued a convertible note to YLimit, LLC in the principal amount of $100,000 with interest at 10% per annum and due on May 9, 2018. The note is secured by the Company’s rights, titles and interests in all the Company’s tangible and intangible assets, including intellectual property and proprietary software whether existing now or created in the future. On August 25, 2017, the Note was amended to authorize total borrowings on this Note to $517,000, and as such an additional $217,000 was advanced to the Company with the terms remaining the same except that the conversion feature was modified to state that all borrowings under the note will be converted at 85% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share.  The balance of the notes outstanding was $517,000 as of December 31, 2017 and the balance of the debt discount was $137,358. On April 12, 2018 and again on August 15, 2018, the Company and Ylimit, LLC entered into an amendment to the original secured convertible promissory note. The amendments increased the borrowing limits by $190,500 to a total of $707,500, and extended the maturity date to May 9, 2019. In addition, the amendment on April 12, 2018 modified the conversion feature to state that all borrowings under the note will be converted at 75% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. This feature gave rise to a derivative liability of $135,900 during the period ended September 30, 2018 that is discussed below. During the nine months ended September 30, 2018, the Company borrowed an additional $190,500. The balance of notes outstanding was $707,500 as of September 30, 2018 and the balance of the debt discount was $120,054.

13

(c)

On August 21, 2017, the Company issued a convertible note to Crossover Capital Fund II, LLC (the “Buyer”) in the principal amount of $61,000 with an interest rate of 8% per annum and a maturity date of August 21, 2018. The note included an original issue discount of $6,000. The note is convertible into shares of common stock of the Company at 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. The balance of the note outstanding was $61,000 as of December 31, 2017. During the nine months ended September 30, 2018, the Buyer elected to convert $17,140 of outstanding principal and $4,960 of outstanding accrued interest into 4,200,000 shares of the Company’s common at $0.005 per share.

On March 2, 2018, the Company issued a second convertible note to Crossover Capital Fund II, LLC (the “Buyer”) in the principal amount of $38,500 with an interest rate of 10% per annum and a maturity date of December 2, 2018. The note included an original issue discount of $3,500. The note is convertible into shares of common stock of the Company at the lower of (i) $0.019 per share or, (ii) 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. This feature gave rise to a derivative liability of $116,098 that is discussed below. In the event of default, as defined in the note agreement, interest shall accrue at a default interest rate of 19% per annum or at the highest rate of interest permitted by law, whichever is less. If the Company loses the bid price for its stock in the market (including the OTC marketplace or other exchange) or the Company’s common stock is delisted from an exchange or if trading has been suspended for more than 10 consecutive days, the outstanding principal amounts would increase 20% or 50%, respectively. The aggregate balance of the notes outstanding, and the related debt discounts was $82,360 and $8,820 as of September 30, 2018, respectively.

  

(d)

From September 1, 2017 to December 31, 2017, the Company issued convertible notes to Golock Capital, LLC (“Lender”) in the aggregate principal amount of $191,750 with an interest rate at 10% per annum and maturity dates between June 1, 2018 and August 31, 2018. The notes are convertible into shares of the Company’s common stock at prices between $0.015 and $0.02 per share. As additional consideration for the Lender to enter into these agreements with the Company, the Company issued warrants to the Lender to acquire in the aggregate 4,804,708 shares of the Company’s common stock at a weighted average exercise price of $0.014 per share. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The balance of the notes outstanding and the related debt discount was $191,750 and $19,652, respectively, as of December 31, 2017.

On February 2, 2018, the Company issued a convertible note to Golock Capital, LLC (“Lender”) in the principal amount of $40,000 with an interest rate at 10% per annum and a maturity date of November 2, 2018. The note included an original issue discount of $5,000. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 2,500,000 shares of the Company’s common stock at an exercise price of $0.015 per share that expire three years from the date of grant. The relative fair value of the warrants, the original issue discount and the beneficial conversion feature totaling $40,000 was recorded as a debt discount and will be amortized to interest expense over the term of the note. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The aggregate balance of the notes outstanding, and the related debt discount was $231,750 and $4,835, respectively, as of September 30, 2018.

14

(e)

On December 20, 2017, the Company issued a convertible note to DBW Investments, LLC (“Lender”) in the principal amount of $21,000 with an interest rate of 10% per annum and a maturity date of September 20, 2018. The note included an original issue discount of $1,000. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued a warrant to the Lender for 200,000 shares of the Company’s common stock at an exercise price of $0.01 per share. The balance of the note outstanding and the debt discount was $21,000 and $2,073, respectively, as of December 31, 2017.

On January 18, 2018, the Company issued a second convertible note to DBW Investments, LLC (“Lender”) in the principal amount of $35,000, which included an original issue discount of $5,000, with an interest rate at 10% per annum and a maturity date of October 18, 2018. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 500,000 shares of the Company’s common stock at an exercise price of $0.015 per share that expire three years from the date of grant. The relative fair value of the warrants, the original issue discount and the beneficial conversion feature totaling $10,367 was recorded as a debt discount and will be amortized to interest expense over the term of the note. The aggregate balance of the notes outstanding, and the related debt discount was $56,000 and $684, respectively, as of September 30, 2018.

  

(f)	On September 6, 2018, the Company issued a convertible note to Black Ice Advisors, LLC (the “Buyer”) in the principal amount of $57,750 with an interest rate of 12% per annum (22% on default) and a maturity date of September 4, 2019. The note is convertible into shares of common stock of the Company at a 38% discount of the lowest trading price for the Company’s common stock during the prior twenty (20) trading day period. This feature gave rise to a derivative liability of $81,092 that is discussed below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 31,818,000 shares of its common stock. The balance of the note outstanding, and the related debt discount was $57,750 and $53,932, respectively, as of September 30, 2018.
(g)	On July 9, 2018 and August 30, 2019, the Company issued two convertible notes to Power Up Lending Group Ltd. (the “Buyer”) in the principal amounts of $63,000 and $35,000, respectively. The notes carry an interest rate is 12% per annum (22% on default) and a maturity date of July 9, 2019 and August 30, 2019. The notes are convertible into shares of common stock of the Company at a 38% discount of the average of the two (2) lowest closing bid prices for the Company’s common stock during the prior fifteen (15) trading day period. This feature gave rise to a derivative liability of $166,862 that is disused below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible notes are subject to prepayment penalties. The Company instructed its transfer agent to reserve 51,138,520 shares of its common stock. The aggregate balance of the notes outstanding, and the related debt discount was $98,000 and $80,701, respectively, as of September 30, 2018.
(h)	On April 12, 2018, the Company issued a convertible note to 2 Doors Management, LLC (“Lender”) in the principal amount of $15,000 with an interest rate of 10% per annum, and a maturity date of January 12, 2019. The convertible note was issued in conjunction with a prior year legal settlement with a vendor for which $15,000 was previously included in the Company’s accounts payable and accrued expenses balance on the Company’s consolidated balance sheet. No cash was received for the convertible note. The convertible note can be prepaid without penalty. In the event of default, the interest rate increases to the highest rate legally allowed. The note is convertible into shares of the Company’s common stock at $0.08 per share. In the event the Company successfully closes on a private offering of $1,000,000 or more, the Lender at closing of the offering may choose to either convert the convertible note into shares of the Company’s common stock at $0.08 per share or request repayment of up to 100 percent of the remaining principal and interest of the convertible note. The balance of the note outstanding was $15,000 as of September 30, 2018.

For YLimit, LLC (b), Crossover Capital Fund II, LLC (c), Black Ice Advisors (f), and Power Up Lending Group (g) above, the Company considered the current FASB guidance of “Contracts in Entity’s Own Stock” which indicates that any adjustment to the fixed amount (either conversion price or number of shares) of the instrument regardless of the probability of whether or not within the issuers’ control means the instrument is not indexed to the issuer’s own stock. Accordingly, the Company determined that the conversion prices of the Notes were not a fixed amount because they were either subject to an adjustment based on the occurrence of future offerings or events or the conversion price was variable. As a result, the Company determined that the conversion features of the Notes were not considered indexed to the Company’s own stock and characterized the fair value of the conversion features as derivative liabilities upon issuance. The Company determined that upon issuance of the Notes, the initial fair value of the embedded conversion feature was recorded as debt discount offsetting the fair value of the Notes and the remainder recorded as financing costs in the Consolidated Statement of Operations. The discount is being amortized using the effective interest rate method over the life of the debt instruments.

15

The balance of the unamortized discount at December 31, 2017, was $198,025. During the nine months ended September 30, 2018, the Company issued $474,750 of convertible notes whose conversion features created a derivative liability upon issuance with a fair value of $499,952, of which $326,650 was recorded as a valuation discount, and the remaining $173,302 was recorded as a financing cost. In addition, the Company recorded debt discount of $40,367 related to warrants issued in conjunction with the issuance of convertible notes totaling $75,000 during the period and debt discount of $13,500 relating to issuance costs. During the nine months ended September 30, 2018, amortization of debt discount was $309,513. The unamortized balance of the debt discount was $269,029 as of September 30, 2018.

For the purposes of Balance Sheet presentation, convertible notes payable have been presented as follows:

	September 30, 2018		December 31, 2017
Convertible notes payable, net	$	994,331	$	617,725
Convertible notes payable, related party, net		30,000		30,000
Total	$	1,024,331	$	647,725

NOTE 7 – DERIVATIVE LIABILITY

The FASB has issued authoritative guidance whereby instruments which do not have fixed settlement provisions are deemed to be derivative instruments. The conversion prices of the Notes described in Note 6 were not a fixed amount because they were either subject to an adjustment based on the occurrence of future offerings or events or they were variable. Since the number of shares is not explicitly limited, the Company is unable to conclude that enough authorized and unissued shares are available to settle the conversion option. In accordance with the FASB authoritative guidance, the conversion features have been characterized as derivative liabilities to be re-measured at the end of every reporting period with the change in value reported in the statement of operations.

As of September 30, 2018 and December 31, 2017, the derivative liabilities were valued using a probability weighted average Black-Scholes-Merton pricing model with the following assumptions:

	September 30, 2018			Issued During 2018			December 31, 2017
Exercise Price	$ 0.005 – 0.035			$ 0.005 – 0.035			$ 0.002 – 0.108
Stock Price	$	0.016		$ 0.010 - 0.037			$	0.109
Risk-free interest rate		2.59	%	1.79 – 2.61%			0.84 – 1.24%
Expected volatility		293	%	261% - 388%				358	%
Expected life (in years)		1.000		1.000 – 1.304				1.000
Expected dividend yield		0	%		0	%		0	%
Fair Value:	$	865,841		$	499,925		$	866,873

The risk-free interest rate was based on rates established by the Federal Reserve Bank. The Company uses the historical volatility of its common stock to estimate the future volatility for its common stock. The expected life of the conversion feature of the notes was based on the remaining term of the notes. The expected dividend yield was based on the fact that the Company has not customarily paid dividends in the past and does not expect to pay dividends in the future.

During the nine months ended September 30, 2018, the Company recognized $390,129 as other income, which represented the change in the value of the derivative from the respective prior period. In addition, the Company recognized derivative liabilities of $499,952 upon issuance of convertible notes and recognized a gain on extinguishment of derivative liabilities of $110,855 upon the conversion of convertible notes during the period.

16

NOTE 8 – STOCKHOLDERS’ DEFICIT

Shares issued to settle outstanding obligations

Executive Officers

During the nine months ended September 30, 2018, the Company entered into conversion and cancellation of debt agreements with two executive officers. The Company agreed to convert a note payable for $74,131 and aggregate accrued payroll of $419,805 into 3,746,660 shares of the Company’ stock, valued at $74,933 using the closing market price of the Company’s stock on the date of the conversion and cancellation of debt agreements. The difference between the total executive obligations converted of $493,936, and the market value of the shares issued of $74,933, was recorded as contributed capital of $419,003 in the condensed consolidated statements of stockholders’ deficit for the nine months ended September 30, 2018.

Vendors

During the nine months ended September 30, 2018, the Company entered into conversion and cancellation of debt agreements with several of its vendors. The Company agreed to convert $202,094 of outstanding vendor obligations into 5,616,086 shares of the Company’ stock, valued at $160,983 using the closing market price of the Company’s stock on the date of the conversion and cancellation of debt agreements. The difference between the total vendor obligations converted of $202,094, and the market value of the shares issued of $160,983, was recorded as a gain on settlement of obligations of $41,111 in other income in the condensed consolidated statements of operations for the nine months ended September 30, 2018.

Conversion of Debt

On April 8, 2018 and April 12, 2018, the Company entered into conversion and cancellation of debt agreements relating to two outstanding convertible notes. The Company agreed to convert the outstanding aggregate principal and interest balances of $35,752 into 4,400,000 shares of common stock with a fair value of $150,000, and recorded a loss on cancellation of debt of $114,248.

Shares issued for services

In May and July of 2018, the Company issued an aggregate of 1,300,000 shares valued at $32,500, for services received relating to consulting agreements.

Shares issued for acquisition

On July 27, 2018, the Company issued 2,275,000 shares valued at $68,250, or $0.03 per share, related to an acquisition (see Note 3).

Shares to be issued

As of December 31, 2017, the Company had not yet issued 6,537,352 shares of common stock with a value of $932,734 due for past services provided. During the nine months ended September 30, 2018, the Company issued 3,813,000 shares of common stock with a value of $707,895 related to the prior year unissued shares. In addition, the Company agreed to issue a total of 620,000 shares valued at $13,652, or $0.02 per share, for services rendered. As of September 30, 2018, the Company had not yet issued 3,404,352 shares of common stock with a value of $238,491 for past services provided and an acquisition.

17

Warrants

A summary of warrant activity for the nine months ended September 30, 2018, is as follows:

	Number of		Weighted - Average
	Warrants		Exercise Price
Outstanding at December 31, 2017		5,004,708	$	0.014
Granted		3,000,000		0.015
Forfeited		-		-
Outstanding at September 30, 2018		8,004,708	$	0.014
Exercisable at September 30, 2018		8,004,708	$	0.014

Information relating to outstanding warrants at September 30, 2018, summarized by exercise price, is as follows:

Outstanding							Exercisable
					Weighted				Weighted
					Average				Average
Range of					Exercise				Exercise
Exercise	Shares		Life in Years		Price		Shares		Price
$0.01 - $0.15		8,004,708		2.14	$	0.014		8,004,708	$	0.014
		8,004,708						8,004,708

During the nine months ended September 30, 2018, the Company issued 3,000,000 warrants with a three (3) year expiration date and an exercise price of $0.015 per share to purchase the Company’s common stock as an inducement to enter into certain convertible note agreements. The aggregate relative fair value of the warrants granted was determined to be $24,085 which was recorded as a debt discount and is being amortized to financing costs over the term of the related convertible notes.

The weighted-average remaining contractual life of warrants outstanding and exercisable at September 30, 2018 was 2.14 years. The intrinsic value of both outstanding and exercisable warrants at September 30, 2018 was $13,353.

NOTE 9 – COMMITMENT AND CONTINGENCIES

Joint Venture Agreement – Music Reports, Inc.

On September 1, 2018, the Company entered into an initial joint venture (“JV”) agreement with Music Reports, Inc., (“MRI”). Music Reports (musicreports.com), , will initially partner with VNUE to provide Performing Rights Organization (PRO) data to VNUE’s Soundstr MRT (music recognition technology) platform through its extensive Songdex database, and will eventually work with VNUE to integrate automated direct licensing capability and royalty payment and distribution into the Soundstr platform. The initial term of the JV is for six (6) months and requires the Company to Pay MRI fifty percent (50%) of net revenue of a quarterly basis. As of September 30, 2018, no net revenue was generated from the JV.

18

Litigation – Hughes Media Law Group, Inc.

On December 11, 2015, Hughes Media Law Group, Inc. (“HLMG”) filed a lawsuit against VNUE, Inc. in the Superior Court of King County, Washington, under case number 15-2-30108-0. HMLG claims damages of $130,553 for unpaid legal fees HMLG alleges are owed pursuant to an April 4, 2014 agreement with VNUE Washington, for legal work performed by HMLG for VNUE Washington prior to the Merger. The Complaint sets forth no legal basis for a lawsuit against VNUE, Inc. (Nevada) and does not, in fact, sue VNUE Washington, HMLG’s former client. The Company believes that VNUE, Inc. (Nevada) is not the proper party for this lawsuit, and reserves all available defenses and counterclaims. Under Washington Superior Court rules, VNUE, Inc. (Nevada) if service of process takes place outside of Washington, a defendant has Sixty (60) days from the date on which it was served the Complaint, to file a response setting forth its defenses. On July 25, 2016, the court issued judgment awarding HLMG $133,482 with interest at a rate of 12% per annum. The judgment stipulated that $12,000 be paid within five days of the judgment and payments of $4,000 per month to start in October, 2016. The amount of the settlement has been recorded in accounts payable in the accompanying condensed consolidated balance sheets at December 31, 2017. On April 12, 2018, the Company and Hughes Media Law Group, Inc. (“HLMG”) entered into a conversion and cancellation of debt agreement relating to the outstanding obligation. The Company agreed to convert the total remaining outstanding obligation of $118,065 into 3,935,512 shares of common stock, or $0.03 per share (see Note 8).

NOTE 10 – SUBSEQUENT EVENTS

On October 19, 2018, the Company issued a convertible note to Power Up Lending Group Ltd. (the “Buyer”) in the principal amount of $35,000 with an interest rate of 12% per annum (22% on default) and a maturity date of October 18, 2019. The note is convertible into shares of common stock of the Company at a 38% discount of the two (2) lowest closing bid prices for the Company’s common stock during the prior fifteen (15) trading day period. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 38,602,941 shares of its common stock.

On October 18, 2018, the Company issued a convertible note to a private investor (the “Buyer”) in the principal amount of $50,000 with an interest rate of 10% per annum and a maturity date of March 19, 2020. The note is convertible into shares of common stock of the Company at 75% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. The convertible note is not subject to prepayment penalties.

On October 23, 2018, the Company issued a convertible note to LG Capital Funding, LLC (the “Buyer”) in the principal amount of $52,500 with an interest rate of 8% per annum (24% on default) and a maturity date of October 23, 2019. The note is convertible into shares of common stock of the Company at a 42% discount of the lowest trading price of the Company’s common stock for the twenty (20) prior trading days including the day upon which the notice of conversion is received by the Company. The Buyer is limited to convert no more than 4.90%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 40,640,000 shares of its common stock.

Subsequent to September 30, 2018, the Company issued 2,000,000 shares of common stock, for consulting services, valued at $19,950, or $0.01 per share.

On October 23, 2018, Crossover Capital Fund II, LLC (see Note 6) elected to convert $10,130 of outstanding principal and $370 of outstanding accrued interest into 3,000,000 shares of the Company’s common at $0.0035 per share. 

19

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

The statements in this quarterly report that are not reported financial results or other historical information are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. These statements appear in a number of different places in this report and can be identified by words such as “estimates”, “projects”, “expects”, “intends”, “believes”, “plans”, or their negatives or other comparable words. Also look for discussions of strategy that involve risks and uncertainties. Forward-looking statements include, among others, statements regarding our business plans and availability of financing for our business.

You are cautioned that any such forward-looking statements are not guarantees and may involve risks and uncertainties. Our actual results may differ materially from those in the forward-looking statements due to risks facing us or due to actual facts differing from the assumptions underlying our estimates. Some of these risks and assumptions include those set forth in reports and other documents we have filed with or furnished to the United States Securities and Exchange Commission (“SEC”). We advise you that these cautionary remarks expressly qualify in their entirety all forward-looking statements attributable to us or persons acting on our behalf. Unless required by law, we do not assume any obligation to update forward-looking statements based on unanticipated events or changed expectations. However, you should carefully review the reports and other documents we file from time to time with the SEC.

Presentation of Information

As used in this annual report, the terms “we”, “us”, “our” and the “Company” mean VNUE, Inc. and its subsidiaries, unless the context requires otherwise.

All dollar amounts in this annual report refer to US dollars unless otherwise indicated.

Overview

We were incorporated as a Nevada corporation on April 4, 2006.

Overview of our Current Business

Following the Merger on May 29, 2015, we now carry on business as a live entertainment music service company which brings bands and fans together by capturing professional quality audio and video recordings of live performances and delivers the experience of a venue to your home and hand.

By streamlining the processes of curation, clearing, capturing, distribution & monetization, VNUE manages and simplifies the complexities of the music ecosystem.

VNUE captures content through its Front of House mobile application and provides world-wide distribution and monetization through a suite of mobile, web administration applications, allowing an artist to seamlessly deliver and sell their live performances directly to the fans who attend their shows.

On July 10, 2017, the Company entered into a Licensing Agreement with RockHouse Live Media Productions, Inc., DBA “DiscLive” or “DiscLive Network” (“DiscLive”) to formalize the terms of the Strategic Alliance entered into by the Company with DiscLive on July 21, 2016. VNUE has acquired an exclusive license from DiscLive, for a period of three years unless earlier terminated under the Agreement, for the use of all its assets, including but not limited to the DiscLive brand, website (including eCommerce platform), intellectual property, inventory, equipment, trade secrets and anything related to its business of “instant live” recording. Under the terms of the Agreement, DiscLive granted the Company a worldwide exclusive license. In exchange for the license, DiscLive will receive a license fee equal to five percent (5%) of any sales derived from the sale and use of the products and services. DiscLive is controlled by our Chief Executive Officer.

20

On October 16, 2017, the Company entered into an agreement with PledgeMusic, Inc., whereby the Company acquired the assets of the digital live music distribution platform Set.fm from PledgeMusic (See Note 3 of the condensed consolidated financial statements herein). Additionally, the Company will offer PledgeMusic North America’s full suite of music business tools allowing artists to sell music, merchandise and live experiences directly to fans, enhancing the Company’s clients’ revenue opportunities on a shared revenue basis. Set.fm is a do-it-yourself (DIY) platform that makes it easy for artists to record and sell their live shows directly to fans’ mobile devices, uploading simultaneously with their performance. The platform, which also features an innovative and easy-to-use studio app, already boasts thousands of artists and tens of thousands of fans using it. VNUE plans to update and improve the existing platform for indie artists and their fans, and to implement pro features for artists that VNUE and its affiliate DiscLive produce.

On April 23, 2018, the Company entered into an agreement with MusicPlay Analytics, LLC (d/b/a Soundstr) (“Soundstr”) whereby the Company acquired the assets of Soundstr, a technology that aims to help businesses pay fairer music license fees based on actual music usage.

The following discussion and analysis of our results of operations and financial condition for the three and nine months ended September 30, 2018 and 2017, should be read in conjunction with our condensed consolidated financial statements and related notes included in this report. We are in the process of completing development of our products and services and therefore had minimal revenues during this quarter.

Three Months Ended September 30, 2018 Compared to Three Months Ended September 30, 2017

Revenues

Our revenues for the three months ended September 30, 2018 and 2017, was $14,370 and $0, respectively. The revenues resulted from the use of the assets licensed from DiscLive discussed above.

Direct Costs of Revenues

Our direct costs of revenues for the three months ended September 30, 2018 and 2017, was $30,660 and $0, respectively. The direct costs of revenues resulted from the use of the assets licensed from DiscLive.

Research and Development

Our research and development expenses for the three months ended September 30, 2018 and 2017, was $2,538 and $24,778, respectively. The decrease in research and development expenses relative to last year reflected the decrease in full time personnel and contract labor caused by our lack of sufficient working capital.

General and Administrative Expenses

Our general and administrative expenses for the three months ended September 30, 2018 and 2017, was $317,875 and $172,319, respectively. The increase in general and administrative expenses relative to last year was due to increased amortization expense related to our recent acquisitions and increased professional fees.

Other Income (Expenses), Net

We recorded other expense, net of $218,393 for the three months ended September 30, 2018, compared to other expense of $110,712 for the three months ended September 30, 2017. The change in other income (expenses), net, was primarily due to the change in the fair value of derivative liabilities of $74,587, a change in the gain on the extinguishment of derivative liability of $98,203, and decreased financing costs of $135,109, as compared to the prior year period. In addition, we recorded a loss on settlement of convertible note payable of $70,000, which did not occur during the prior year period.

Net Loss

As a result of the foregoing revenues, direct costs of revenues, research and development expenses, general and administrative expenses, and other income (expenses), net, our net loss for the three months ended September 30, 2018 was $555,096 compared to our net loss for the three months ended September 30, 2017 of $307,809.

21

Nine Months Ended September 30, 2018 Compared to Nine Months Ended September 30, 2017

Revenues

Our revenues for the nine months ended September 30, 2018 and 2017, was $35,194 and $37,825, respectively. The revenues resulted from the use of the assets licensed from DiscLive discussed above.

Direct Costs of Revenues

Our direct costs of revenues for the nine months ended September 30, 2018 and 2017, was $68,062 and $35,151, respectively. The direct costs of revenues resulted from the use of the assets licensed from DiscLive.

Research and Development

Our research and development expenses for the nine months ended September 30, 2018 and 2017, was $17,711 and $92,905, respectively. The decrease in research and development expenses relative to last year reflected the decrease in full time personnel and contract labor caused by our lack of sufficient working capital.

General and Administrative Expenses

Our general and administrative expenses for the nine months ended September 30, 2018 and 2017, was $731,323 and $631,057, respectively. The increase in general and administrative expenses relative to last year was due to increased amortization expense related to our recent acquisitions and increased professional fees.

Other Income (Expenses), Net

We recorded other expense, net of $133,391 for the nine months ended September 30, 2018, compared to other expense of $360,238 for the nine months ended September 30, 2017. The change in other income (expenses), net, was primarily due to the change in the fair value of derivative liabilities of $352,060, the change in gain on the extinguishment of derivative liability of $181,982, and the change in financing costs of $129,905 as compared to the prior year period. In addition, we recorded a loss on settlement of debt of $114,248, and a gain on settlement of employee and vendor obligation of $41,112, all of which did not occur during the prior year period.

Net Loss

As a result of the foregoing revenues, direct costs of revenues, research and development expenses, general and administrative expenses, and other income (expenses), net, our net loss for the nine months ended September 30, 2018 was $1,099,183, compared to our net loss for the nine months ended September 30, 2017 of $1,081,526.

Liquidity and Capital Resources

Since our inception, we have funded our operations primarily through private offerings of our equity securities and loans.

As of September 30, 2018, we had cash and cash equivalents of $39,389.

We had negative cash flows from operating activities of $417,139 for the nine months ended September 30, 2018, compared with negative cash flows from operating activities of $318,757 for the nine months ended September 30, 2017. Our negative cash flows was to fund our operating losses.

We generated cash flows from financing activities of $446,250 for the nine months ended September 30, 2018, as compared to $374,000 for the nine months ended September 30, 2017. The cash flows from financing activities for the nine months ended September 30, 2018 was from proceeds received from the issuance of convertible notes.

The cash flows from financing activities for the nine months ended September 30, 2017 was due to $407,000 in proceeds from convertible notes less repayments of $33,000.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

22

Going Concern

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying condensed consolidated financial statements, during the nine months ended September 30, 2018, the Company incurred a net loss of $915,293, used cash in operations of $417,139 and had a stockholders’ deficit of $2,705,241 as of September 30, 2018. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date of the financial statements being issued. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to raise additional funds and implement its business plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s December 31, 2017 consolidated financial statements, has raised substantial doubt about the Company’s ability to continue as a going concern.

At September 30, 2018, the Company had cash on hand in the amount of $39,389. Subsequent to September 30, 2018, the Company received additional borrowings of $134,500. Management estimates that the current funds on hand will be sufficient to continue operations through December 2018. The continuation of the Company as a going concern is dependent upon its ability to obtain necessary debt or equity financing to continue operations until it begins generating positive cash flow. No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing or cause substantial dilution for our stock holders, in case or equity financing.

We have not generated meaningful revenues, have incurred losses since our inception, and rely upon the sale of our common stock and loans from related and other parties to fund our operations. While we do plan to generate increasing revenues in the foreseeable future, if we are unable to raise equity or secure alternative financing, we may not be able to pursue our plans and our business may fail.

Convertible Notes Payable

Ylimit, LLC

On May 9, 2016 the Company issued a convertible note to YLimit, LLC in the principal amount of $100,000 with interest at 10% per annum and due on May 9, 2018. The note is secured by the Company’s rights, titles and interests in all the Company’s tangible and intangible assets, including intellectual property and proprietary software whether existing now or created in the future. On August 25, 2017, the Note was amended to authorize total borrowings on this Note to $517,000, and as such an additional $217,000 was advanced to the Company with the terms remaining the same except that the conversion feature was modified to state that all borrowings under the note will be converted at 85% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. The balance of the notes outstanding was $517,000 as of December 31, 2017 and the balance of the debt discount was $137,358. On April 12, 2018 and again on August 15, 2018, the Company and Ylimit, LLC entered into an amendment to the original secured convertible promissory note. The amendments increased the borrowing limits by $190,500 to a total of $707,500, and extended the maturity date to May 9, 2019. In addition, the amendment on April 12, 2018 modified the conversion feature to state that all borrowings under the note will be converted at 75% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. During the nine months ended September 30, 2018, the Company borrowed an additional $190,500. The balance of notes outstanding was $707,500 as of September 30, 2018 and the balance of the debt discount was $120,054.

Crossover Capital Fund II, LLC

On August 21, 2017, the Company issued a convertible note to Crossover Capital Fund II, LLC (the “Buyer”) in the principal amount of $61,000 with an interest rate of 8% per annum and a maturity date of August 21, 2018. The note included an original issue discount of $6,000. The note is convertible into shares of common stock of the Company at 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. The balance of the note outstanding was $61,000 as of December 31, 2017. During the nine months ended September 30, 2018, the Buyer elected to convert $17,140 of outstanding principal and $4,960 of outstanding accrued interest into 4,200,000 shares of the Company’s common at $0.005 per share.

On March 2, 2018, the Company issued a second convertible note to Crossover Capital Fund II, LLC (the “Buyer”) in the principal amount of $38,500 with an interest rate of 10% per annum and a maturity date of December 2, 2018. The note included an original issue discount of $3,500. The note is convertible into shares of common stock of the Company at the lower of (i) $0.019 per share or, (ii) 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. In the event of default, as defined in the note agreement, interest shall accrue at a default interest rate of 19% per annum or at the highest rate of interest permitted by law, whichever is less. If the Company loses the bid price for its stock in the market (including the OTC marketplace or other exchange) or the Company’s common stock is delisted from an exchange or if trading has been suspended for more than 10 consecutive days, the outstanding principal amounts would increase 20% or 50%, respectively. The Company is required to instruct its transfer agent to reserve 25,000,000 share of its common stock. The aggregate balance of the notes outstanding, and the related debt discounts was $82,360 and $8,820 as of September 30, 2018, respectively.

23

Golock Capital, LLC

From September 1, 2017 to December 31, 2017, the Company issued convertible notes to Golock Capital, LLC (“Lender”) in the aggregate principal amount of $191,750 with an interest rate at 10% per annum and maturity dates between June 1, 2018 and August 31, 2018. The notes are convertible into shares of the Company’s common stock at prices between $0.015 and $0.02 per share. As additional consideration for the Lender to enter into these agreements with the Company, the Company issued warrants to the Lender to acquire in the aggregate 4,804,708 shares of the Company’s common stock at a weighted average exercise price of $0.014 per share. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The balance of the notes outstanding and the related debt discount was $191,750 and $19,652, respectively, as of December 31, 2017.

On February 2, 2018, the Company issued a convertible note to Golock Capital, LLC (“Lender”) in the principal amount of $40,000 with an interest rate at 10% per annum and a maturity date of November 2, 2018. The note included an original issue discount of $5,000. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 2,500,000 shares of the Company’s common stock at an exercise price of $0.015 per share. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The aggregate balance of the notes outstanding, and the related debt discount was $231,750 and $4,835, respectively, as of September 30, 2018.

DBW Investments, LLC

On December 20, 2017, the Company issued a convertible note to DBW Investments, LLC (“Lender”) in the principal amount of $21,000 with an interest rate of 10% per annum and a maturity date of September 20, 2018. The note included an original issue discount of $1,000. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued a warrant to the Lender for 200,000 shares of the Company’s common stock at an exercise price of $0.01 per share. The balance of the note outstanding and the debt discount was $21,000 and $2,073, respectively, as of December 31, 2017.

On January 18, 2018, the Company issued a second convertible note to DBW Investments, LLC (“Lender”) in the principal amount of $35,000, which included an original issue discount of $5,000, with an interest rate at 10% per annum and a maturity date of October 18, 2018. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 2,500,000 shares of the Company’s common stock at an exercise price of $0.015 per share. The aggregate balance of the notes outstanding, and the related debt discount was $56,000 and $684, respectively, as of September 30, 2018.

Black Ice Advisors, LLC

On September 6, 2018, the Company issued a convertible note to Black Ice Advisors, LLC (the “Buyer”) in the principal amount of $57,750 with an interest rate of 12% per annum (22% on default) and a maturity date of September 4, 2019. The note is convertible into shares of common stock of the Company at a 38% discount of the lowest trading price for the Company’s common stock during the prior twenty (20) trading day period. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 31,818,000 shares of its common stock. The balance of the note outstanding, and the related debt discount was $57,750 and $53,932, respectively, as of September 30, 2018.

24

Power Up Lending Group Ltd.

On July 9, 2018 and August 30, 2019, the Company issued two convertible notes to Power Up Lending Group Ltd. (the “Buyer”) in the principal amounts of $63,000 and $35,000, respectively. The notes carry an interest rate is 12% per annum (22% on default) and a maturity date of July 9, 2019 and August 30, 2019. The notes are convertible into shares of common stock of the Company at a 38% discount of the average of the two (2) lowest closing bid prices for the Company’s common stock during the prior fifteen (15) trading day period. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible notes are subject to prepayment penalties. The Company instructed its transfer agent to reserve 51,138,520 shares of its common stock. The aggregate balance of the notes outstanding, and the related debt discount was $98,000 and $80,701, respectively, as of September 30, 2018.

2 Doors Management, LLC

On April 12, 2018, the Company issued a convertible note to 2 Doors Management, LLC (“Lender”) in the principal amount of $15,000 with an interest rate of 10% per annum, and a maturity date of January 12, 2019. The convertible note was issued in conjunction with a prior year legal settlement with a vendor for which $15,000 was previously included in the Company’s accounts payable and accrued expenses balance on the Company’s consolidated balance sheet. No cash was received for the convertible note. The convertible note can be prepaid without penalty. In the event of default, the interest rate increases to the highest rate legally allowed. The note is convertible into shares of the Company’s common stock at $0.08 per share. In the event the Company successfully closes on a private offering of $1,000,000 or more, the Lender at closing of the offering may choose to either convert the convertible note into shares of the Company’s common stock at $0.08 per share or request repayment of up to 100 percent of the remaining principal and interest of the convertible note. The balance of the note outstanding was $15,000 as of September 30, 2018.

Critical Accounting Policies and Estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which were prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported expenses during the reporting periods. Actual results may differ from these estimates under different assumptions or conditions.

While our significant accounting policies are more fully described in the notes to our financial statements appearing elsewhere in this prospectus, we believe that the accounting policies discussed below are critical to our financial results and to the understanding of our past and future performance, as these policies relate to the more significant areas involving management’s estimates and assumptions. We consider an accounting estimate to be critical if: (1) it requires us to make assumptions because information was not available at the time or it included matters that were highly uncertain at the time we were making our estimate; and (2) changes in the estimate could have a material impact on our financial condition or results of operations. (See Note 2 - Significant and Critical Accounting Policies and Practices herein).

Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the 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. Critical accounting estimates are estimates for which (a) the nature of the estimate is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change and (b) the impact of the estimate on financial condition or operating performance is material. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. Significant estimates include the assumptions used to determine the value of the derivative liabilities, the valuation allowance for the deferred tax asset and the accruals for potential liabilities.

25

Derivative Financial Instruments

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the condensed consolidated statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date.

Stock-Based Compensation

The Company periodically issues stock options and warrants to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for stock option and warrant grants issued and vesting to employees based on the authoritative guidance provided by FASB where the value of the award is measured on the date of grant and recognized as compensation expense on the straight-line basis over the vesting period. The Company accounts for stock option and warrant grants issued and vesting to non-employees in accordance with the authoritative guidance of the FASB where the value of the stock compensation is based upon the measurement date as determined at either a) the date at which a performance commitment is reached, or b) at the date at which the necessary performance to earn the equity instruments is complete. Options granted to non-employees are revalued each reporting period to determine the amount to be recorded as an expense in the respective period. As the options vest, they are valued on each vesting date and an adjustment is recorded for the difference between the value already recorded and the then current value on the date of vesting. In certain circumstances where there are no future performance requirements by the non-employee, option grants are immediately vested and the total stock-based compensation charge is recorded in the period of the measurement date.

The fair value of the Company’s stock option and warrant grants are estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or warrants, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model, and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods.

Recent Accounting Pronouncements

See Note 2 of the Condensed Consolidated Financial Statement herein for management’s discussion of recent accounting pronouncements.

Selected Financial Data

Not applicable.

Item 3. Quantitative and Qualitative Disclosures of Market Risk

Not applicable.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

In connection with the preparation of this quarterly report, an evaluation was carried out by our management, with the participation of our principal executive officer and principal accounting officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) as of September 30, 2018. Disclosure controls and procedures are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management to allow timely decisions regarding required disclosures.

26

Based on that evaluation, and the material weaknesses outlined below under Internal Control Over Financial Reporting, our principal executive officer and principal accounting officer concluded, as of the end of the period covered by this annual report, that, due to weaknesses in our internal controls described below, our disclosure controls and procedures were not effective in recording, processing, summarizing and reporting information required to be disclosed, within the time periods specified in the SEC’s rules and forms, and that such information may not be accumulated and communicated to our principal executive officer and principal accounting officer to allow timely decisions regarding required disclosures.

Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining effective internal control over financial reporting. Under the supervision of our principal executive officer and principal accounting officer, the Company conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2017 using the criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of December 31, 2017, the Company determined that there were deficiencies that constituted material weaknesses, as described below.

1.	Lack of proper segregation of duties due to limited personnel.
2.	Lack of a formal review process that includes multiple levels of review.

3.	Lack of adequate policies and procedures for accounting for financial transactions.
4.	Lack of independent board member(s)
5.	Lack of independent audit committee

Management is currently evaluating remediation plans for the above control deficiencies.

In light of the existence of these material weaknesses, management concluded that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis by the company’s internal controls. As a result, management has concluded that the Company did not maintain effective internal control over financial reporting as of December 31, 2017 based on criteria established in Internal Control—Integrated Framework issued by COSO.

Changes in Internal Control

During the nine months ended September 30, 2018, there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

27

PART II

OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. Other than described herein, neither the Company, nor its officers or directors are involved in, or the subject of, any pending legal proceedings or governmental actions the outcome of which, in management’s opinion, would be material to our financial condition or results of operations.

On December 11, 2015, Hughes Media Law Group, Inc. filed a lawsuit against VNUE, Inc. in the Superior Court of King County, Washington, under case number 15-2-30108-0. HMLG claims damages of $130,553 for unpaid legal fees HMLG alleges are owed pursuant to an April 4, 2014 agreement with VNUE Washington, for legal work performed by HMLG for VNUE Washington prior to the Merger. The Complaint sets forth no legal basis for a lawsuit against VNUE, Inc. (Nevada) and does not, in fact, sue VNUE Washington, HMLG’s former client. The Company believes that VNUE, Inc. (Nevada) is not the proper party for this lawsuit, and reserves all available defenses and counterclaims. Under Washington Superior Court rules, VNUE, Inc. (Nevada) if service of process takes place outside of Washington, a defendant has Sixty (60) days from the date on which it was served the Complaint, to file a response setting forth its defenses. The lawsuit was amended by HMLG, and now includes VNUE Media, Inc. and VNUE Technology, Inc. as additional parties. On July 25, 2016, the court issued judgment awarding HLMG $133,482 with interest at a rate of 12% per annum. The judgment stipulated that $12,000 be paid within five days of the judgment and payments of $4,000 per month to start in October, 2016. The amount of the settlement has been recorded in accounts payable in the accompanying condensed consolidated balance sheets at December 31, 2017. On April 12, 2018, the Company and Hughes Media Law Group, Inc. (“HLMG”) entered into a conversion and cancellation of debt agreement relating to the outstanding obligation. The Company agreed to convert the outstanding obligation of $118,065 into 3,935,512 shares of common stock, or $0.03 per share.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS SECURITIES

On July 20, 2018 we initiated a private placement of our preferred stock under Regulation D Rule 506(b). We are selling up to 5,000,000 shares of the Company’s Series A 2018 7% Convertible Preferred Stock, $0.0001 par value per share (the “Preferred Stock”). Each share of Preferred Stock bears a seven percent (7%) cumulative dividend (the “Dividend”), due and payable annually at December 31. For every one share of the Company’s Series A 2018 7% Convertible Preferred Stock purchased the holder will receive a warrant to purchase one share of the Company’s common stock at a fixed exercise price of $2.50 per share at any time during the two years from the date of issue. Each Preferred Stock share may be converted by the holder thereof, at any time beginning one year from the date of issuance and from time to time thereafter into that number of fully paid and nonassessable shares of common stock derived from dividing the average closing bid price of Vnue common stock for the five business days prior to the date of conversion into the face amount of each Preferred Share. [Example: If the average five day bid price = $0.25 and the face value is $1.00 then each Preferred Share is convertible into four (4) common stock shares of the Corporation. The Company has the ability to require the holder of the Preferred Stock to convert his shares to common stock upon the occurrence of certain events including the initiation of a public offering by the Company or any time after one year from its date of issuance. We will use the net proceeds of the offering as working capital for the operation of the Company including the payment of salaries, related employment expenses and for the repayment of debt. There can be no assurance that we will successfully complete the offering. 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

There were no defaults upon senior securities during the period ended September 30, 2018.

ITEM 4. MINING SAFETY DISCLOSURES

N/A

ITEM 5. OTHER INFORMATION

None.

28

ITEM 6. EXHIBITS

Exhibits

Exhibit Number	Description of Exhibits
3.1	Articles of Incorporation (1)
3.2	Bylaws (2)
31.1*	Certification of the Chief Executive Officer and Principal Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act
32.1*	Certification of the Chief Executive Officer and Principal Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act

101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Schema
101.CAL	XBRL Taxonomy Calculation Linkbase
101.DEF	XBRL Taxonomy Definition Linkbase
101.LAB	XBRL Taxonomy Label Linkbase
101.PRE	XBRL Taxonomy Presentation Linkbase

___________

* Filed herein

(1)	Included as an exhibit with our Form SB-2 filed October 13, 2006.
(2)	Included as an exhibit with our Form 8-K filed February 1, 2011.

29

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

Registrant	VNUE, Inc.
Date: November 19, 2018	By:	/s/ Zach Bair
		Zach Bair
		Chief Executive Officer and Principal Accounting Officer

30

EX-31.1

EXHIBIT 31.1

Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302

of the Sarbanes-Oxley Act of 2002 and pursuant to Rule 13a-14(a) and Rule 15d-14 under the Securities Exchange Act of 1934

I, Zach Bair certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of VNUE, 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 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 evaluations: 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 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.

Registrant	VNUE, Inc.
Date: November 19, 2018	By:	/s/ Zach Bair
		Zach Bair
		Chief Executive Officer and Principal Accounting Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATIONS PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(18 U.S.C. SECTION 1350)

In connection with the Quarterly Report of VNUE, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Zach Bair, Chief Executive Officer and Principal Accounting Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Registrant	VNUE, Inc.
Date: November 19, 2018	By:	/s/ Zach Bair
		Zach Bair
		Chief Executive Officer and Principal Accounting Officer

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Nov. 16, 2018
Document And Entity Information
Entity Registrant Name	VNUE, Inc.
Entity Central Index Key	0001376804
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		100,485,816
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2018
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Ex Transition Period	false

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Current Assets
Cash	$ 39,389	$ 10,278
Prepaid expenses	2,667	667
Total current assets	42,056	10,945
Intangible assets, net	491,989	320,833
Total assets	534,045	331,778
Current Liabilities
Accounts payable and accrued expenses	652,082	660,506
Accrued payroll	138,825	508,460
Purchased liabilities	234,487
Advances from stockholders	14,720	14,720
Note payable to officer		74,131
Notes payable	9,000	9,000
Convertible notes payable, net	994,331	617,725
Convertible notes payable, related parties, net	30,000	30,000
Derivative liabilities	865,841	866,873
Total current liabilities	2,939,286	2,781,415
Purchase liability	300,000	300,000
Total liabilities	3,239,286	3,081,415
Stockholders' Deficit
Preferred stock, par value $0.0001: 20,000,000 shares authorized; none issued
Common stock, par value $0.0001: 750,000,000 shares authorized; 95,485,816 and 74,335,070 shares issued and outstanding, respectively	9,549	7,433
Additional Paid-in Capital	6,407,535	4,755,719
Common stock to be issued, 3,404,352 shares and 6,537,352 shares, respectively	238,491	932,734
Accumulated deficit	(9,360,816)	(8,445,523)
Total Stockholders' Deficit	(2,705,241)	(2,749,637)
Total Liabilities and Stockholders' Deficit	$ 534,045	$ 331,778

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Stockholders' Deficit
Preferred Stock, par value	$ 0.0001	$ 0.0001
Preferred Stock, shares authorized	20,000,000	20,000,000
Preferred Stock, shares issued	0	0
Common Stock, par value	$ 0.0001	$ 0.0001
Common Stock, shares authorized	750,000,000	750,000,000
Common Stock, shares issued	95,485,816	74,335,070
Common Stock, shares outstanding	95,485,816	74,335,070
Common stock to be issued	3,404,352	6,537,352

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Condensed Consolidated Statements Of Operations
Revenues	$ 14,370		$ 35,194	$ 37,825
Operating Expenses
Direct costs of revenues	30,660		68,062	35,151
Research and development	2,538	24,778	17,711	92,905
General and administrative	317,875	172,319	731,323	631,057
Total operating expenses	351,073	197,097	817,096	759,113
Loss from Operations	(336,703)	(197,097)	(781,902)	(721,288)
Other income/(expenses)
Change in fair value of derivative liability	(17,120)	57,467	390,129	38,068
Gain on extinguishment of derivative liability	76,326	174,529	110,855	292,838
Loss on settlement of convertible note payable	(70,000)		(114,248)
Gain on settlement of obligations			41,111
Financing costs	(207,599)	(342,708)	(561,239)	(691,144)
Other expense, net	(218,393)	(110,712)	(133,391)	(360,238)
Net loss	$ (555,096)	$ (307,809)	$ (915,293)	$ (1,081,526)
Loss per share - Basic and diluted	$ (0.01)	$ (0.00)	$ (0.01)	$ (0.01)
Weighted average common shares outstanding - Basic and diluted	92,763,805	73,919,059	85,058,114	72,205,256

XML

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS DEFICIT (UNAUDITED) - 9 months ended Sep. 30, 2018 - USD ($)	Common Stock	Additional Paid-In Capital	Shares To Be Issued	Total
Beginning balance, Shares at Dec. 31, 2017	74,335,070
Beginning balance, Amount at Dec. 31, 2017	$ 7,433	$ 4,755,719	$ 932,734	$ (2,749,637)
Fair value of warrants and beneficial conversion feature related to convertible notes payable recorded as debt discount in settlement of accrued payroll		40,367		40,367
Gain on extinguishment of accrued payroll to officers/shareholders recorded as contributed capital		419,003		419,003
Shares issued for shares to be issued, Shares	3,813,000
Shares issued for shares to be issued, Amount	$ 381	707,514	(707,895)
Shares issued in settlement of a note payable and accrued payroll to officers, Shares	3,746,660
Shares issued in settlement of a note payable and accrued payroll to officers, Amount	$ 375	74,558		74,933
Shares issued in settlement of accounts payable, Shares	5,616,086
Shares issued in settlement of accounts payable, Amount	$ 562	160,421		160,983
Shares issued for services, Shares	1,300,000
Shares issued for services, Amount	$ 130	32,370	13,652	46,152
Shares issued on conversion of notes payable, Shares	4,400,000
Shares issued on conversion of notes payable, Amount	$ 440	149,560		150,000
Shares issued for acquisition, Shares	2,275,000
Shares issued for acquisition, Amount	$ 228	68,022		68,250
Net loss				(915,293)
Ending balance, Shares at Sep. 30, 2018	95,485,816
Ending balance, Amount at Sep. 30, 2018	$ 9,549	$ 6,407,535	$ 238,491	$ (2,705,241)

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash Flows From Operating Activities
Net loss	$ (915,293)	$ (1,081,526)
Adjustments to reconcile net loss to net cash used in operating activities:
Change in fair value of derivative liabilities	(390,129)	(38,068)
Derivative value in excess of convertible notes considered a financing cost	173,302	291,702
Gain on extinguishment of derivative liability	(110,855)	(292,838)
Gain on settlement of vendor obligations	(41,111)
Loss on extinguishment of debt	114,248
Amortization of debt discount	309,513	265,828
Amortization of intangible asset	131,581
Beneficial conversion feature on conversion of note		65,855
Original issue discount on convertible note payable		9,000
Shares issued for services	46,152	95,125
Changes in operating assets and liabilities:
Prepaid expense	(2,000)	(2,667)
Accounts payable and accrued expenses	217,283	163,707
Accrued payroll	50,170	205,125
Net Cash Used in Operating Activities	(417,139)	(318,757)
Cash Flows From Financing Activities
Proceeds from issuance of convertible notes payable	446,250	407,000
Repayment of convertible notes payable		(33,000)
Net Cash Provided by Financing Activities	446,250	374,000
Net Change in Cash	29,111	55,243
Cash - Beginning of the Reporting Period	10,278	17,952
Cash - End of the Reporting Period	39,389	73,195
Supplemental Disclosure of Cash Flow Information:
Interest Paid
Income Tax Paid
Non-Cash Financing Activities
Common shares issued upon conversion of notes payable and accrued interest	35,752	63,521
Common shares issued upon conversion of accounts payable and accrued expenses	160,983
Common shares issued upon conversion of accured payroll	74,933
Convertible note issued in settlement of accounts payable	15,000
Return of common shares by officer		(500)
Fair value of derivative created upon issuance of convertible notes payable recorded as debt discount	326,650	311,000
Fair value of warrants and beneficial conversion feature related to convertible notes payable recorded as debt discount	40,367
Fair value of common shares issued and liabilities assumed upon the acquisition of Soundstr	302,737
Capital contribution upon conversion of accrued payroll for officers/shareholders	$ 419,003

XML

BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 1 - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of VNUE, Inc. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all normal recurring adjustments considered necessary for a fair presentation have been included. Operating results for the nine months ended September 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018.

History and Organization

VNUE, Inc. (formerly Tierra Grande Resources, Inc.) (“VNUE”, “TGRI”, or the “Company”) was incorporated under the laws of the State of Nevada on April 4, 2006.

On May 29, 2015, VNUE, Inc. entered into a merger agreement with VNUE Washington, Inc. Pursuant to the terms of the Merger Agreement, all of the outstanding shares of any class or series of VNUE Washington were exchanged for an aggregate of 50,762,987 shares of TGRI common stock. As a result of the Merger, VNUE Washington became a wholly-owned subsidiary of the Company, and the transaction was accounted for as a reverse merger with VNUE Washington deemed the acquiring company for accounting purposes, and the Company deemed the legal acquirer.

Overview of Business

The Company is developing a technology driven solution for Artists, Venues and Festivals to automate the capturing, publishing and monetization of their content.

Going Concern

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying condensed consolidated financial statements, during the nine months ended September 30, 2018, the Company incurred a net loss of $915,293, used cash in operations of $417,139, and had a stockholders’ deficit of $2,705,241 as of September 30, 2018. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date of the financial statements being issued. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to raise additional funds and implement its business plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s December 31, 2017 consolidated financial statements, has raised substantial doubt about the Company’s ability to continue as a going concern.

At September 30, 2018, the Company had cash on hand in the amount of $39,389. Subsequent to September 30, 2018, the Company received additional borrowings of $134,500 (see Note 10). Management estimates that the current funds on hand will be sufficient to continue operations through December 2018. The continuation of the Company as a going concern is dependent upon its ability to obtain necessary debt or equity financing to continue operations until it begins generating positive cash flow. No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing or cause substantial dilution for our stock holders, in case or equity financing.

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Consolidation

The Company consolidates all wholly owned and majority-owned subsidiaries in which the Company’s power to control exists. The Company consolidates the following subsidiaries and/or entities:

Name of consolidated subsidiary or Entity	State or other jurisdiction of incorporation or organization	Date of incorporation or formation (date of acquisition/disposition, if applicable)	Attributable interest
VNUE Inc. (formerly TGRI)	The State of Nevada	April 4, 2006 (May 29, 2015)		100	%
VNUE Inc. (VNUE Washington)	The State of Washington	October 16, 2014		100	%
VNUE LLC	The State of Washington	August 1, 2013 (December 3, 2014)		100	%
VNUE Technology Inc.	The State of Washington	October 16, 2014		90	%
VNUE Media Inc.	The State of Washington	October 16, 2014		89	%

VNUE Technology, Inc. and VNUE Media, Inc. were inactive corporations at September 30, 2018 and 2017, respectively. Inter-company balances and transactions have been eliminated.

Revenue Recognition

Effective January 1, 2018, the Company adopted the guidance of Accounting Standards Codification (“ASC”) 606, Revenue from Contracts. The implementation of ASC 606 did not have a material impact on the Company’s condensed consolidated financial statements. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients.

The Company recognizes revenue on the sale of digital video disks (DVD) that contain the recording of live concerts and made available to concert viewers immediately after the show and on-line. Revenue is recognized on the sale of a product when the risk of loss transfers to our customers, and collection of the receivable is reasonably assured, which generally occurs when the product is purchased.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the U.S requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the financial statement date, and reported amounts of revenue and expenses during the reporting period. Significant estimates include the assumptions used to value the derivative liabilities, the valuation allowance for the deferred tax asset and the accruals for potential liabilities. Actual results could differ from these estimates.

Fair Value of Financial Instruments

The Company determines the fair value of its assets and liabilities based on the exchange price in U.S. dollars that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company uses a fair value hierarchy with three levels of inputs, of which the first two are considered observable and the last unobservable, to measure fair value:

· Level 1 — Quoted prices in active markets for identical assets or liabilities.

· Level 2 — Inputs, other than Level 1, that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

· Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The carrying amounts of financial instruments such as cash, and accounts payable and accrued liabilities, approximate the related fair values due to the short-term maturities of these instruments.

The fair value of the derivative liabilities of $865,841 and $866,873 at September 30, 2018 and December 31, 2017, respectively, were valued using Level 2 inputs.

Derivative Financial Instruments

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the condensed consolidated statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date.

Loss per Common Share

Basic earnings (loss) per share are computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of shares of Common Stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation if their effect is antidilutive.

For the nine months ended September 30, 2018 and 2017, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an anti-dilutive effect. As of September 30, 2018 and 2017, we excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from our calculation of earnings per share, as their effect would have been anti-dilutive.

	September 30,
	2018		2017
Convertible Notes Payable		83,918,108		110,015,835
Warrants		8,004,708		1,000,000
Total		91,922,816		111,015,835

Intangible Assets

The Company accounts for intangible assets in accordance with the authoritative guidance issued by the FASB. Intangibles are valued at their fair market value and are amortized taking into account the character of the acquired intangible asset and the expected period of benefit. The Company evaluates intangible assets for impairment, at a minimum, on an annual basis and whenever events or changes in circumstances indicate that the carrying value may not be recoverable from its estimated undiscounted future cash flows. Recoverability of intangible assets is measured by comparing their net book value to the related projected undiscounted cash flows from these assets, considering a number of factors, including past operating results, budgets, economic projections, market trends and product development cycles. If the net book value of the asset exceeds the related undiscounted cash flows, the asset is considered impaired, and a second test is performed to measure the amount of impairment loss.

The Company had intangible assets with a carrying value of $491,989 and $320,833 as of September 30, 2018 and December 31, 2017, respectively. In accordance with ASC Topic 350 – Goodwill and Other Intangible Assets, the Company assesses the carrying value of its intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable and records an impairment charge if the carrying value of such intangible assets is not recoverable and if it exceeds its fair value. While our fiscal year-to-date financial performance has not met our expectations, and the enterprise value of the Company based on the current price of our common stock may fluctuate at or near the recorded level of finite-lived intangible assets, management does not consider these to be events requiring the performance of an impairment test. The Company will continue to monitor its operating results for indicators of impairment and perform additional tests as necessary, which could result in an impairment charge to intangible assets.

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-02, Leases. ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months. ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is in the process of evaluating the impact of ASU 2016-02 on the Company’s financial statements and disclosures.

In July 2017, the FASB issued ASU No. 2017-11, “Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features; (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception” (“ASU 2017-11”). ASU 2017-11 allows companies to exclude a down round feature when determining whether a financial instrument (or embedded conversion feature) is considered indexed to the entity’s own stock. As a result, financial instruments (or embedded conversion features) with down round features may no longer be required to be accounted for as derivative liabilities. A company will recognize the value of a down round feature only when it is triggered, and the strike price has been adjusted downward. For equity-classified freestanding financial instruments, an entity will treat the value of the effect of the down round as a dividend and a reduction of income available to common shareholders in computing basic earnings per share. For convertible instruments with embedded conversion features containing down round provisions, entities will recognize the value of the down round as a beneficial conversion discount to be amortized to earnings. ASU 2017-11 is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The guidance in ASU 2017-11 can be applied using a full or modified retrospective approach. The Company is currently evaluating the impact of the adoption of ASU 2017-11 on the Company’s financial statement presentation or disclosures.

In September 2018, the FASB issued ASU 2018-07, “Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting.” The ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The ASU also clarifies that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Revenue from Contracts with Customers (Topic 606). The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted. The Company is currently assessing the effect that the ASU will have on our financial position, results of operations, and disclosures.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements.

XML

INTANGIBLE ASSETS AND PURCHASE LIABILITY

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 3 - INTANGIBLE ASSETS AND PURCHASE LIABILITY

Intangible assets as of September 30, 2018 and December 31, 2017, consist of the following:

	As of
	September 30,			December 31,
	2018			2017
Intangible assets	$	652,737		$	350,000
Accumulated amortization		(160,748	)		(29,167	)
Intangible assets, net	$	491,989		$	320,833

Asset Acquisition – Set.fm

On October 16, 2017, the Company entered into an agreement with PledgeMusic, Inc. (the “Seller”), whereby the Company acquired the digital live music distribution platform “Set.fm” from PledgeMusic. Additionally, the Company will offer PledgeMusic North America’s full suite of music business tools allowing artists to sell music, merchandise and live experiences directly to fans, enhancing the Company’s clients’ revenue opportunities on a shared revenue basis. Set.fm is a do-it-yourself (DIY) platform that makes it easy for artists to record and sell their live shows directly to fans’ mobile devices, uploading simultaneously with their performance. The platform, which also features an innovative and easy-to-use studio app, already boasts thousands of artists and tens of thousands of fans using it. VNUE plans to update and improve the existing platform for indie artists and their fans, and to implement pro features for artists that VNUE and its affiliate DiscLive produce. The Company determined that the acquisition of Set.fm constituted the acquisition of an asset for accounting purposes.

The purchase price for the acquisition was comprised of $50,000 paid in cash, and a purchase liability of $300,000, for an aggregate purchase price of $350,000. The purchase liability is payable on the net revenues derived from VNUE’s live recording and content business and must be paid in full to the Seller no later than the three (3) year anniversary of the date of the agreement, or October 16, 2020. If the Company fails to pay the Seller the purchase liability on time, the Seller may request at any time within one hundred eighty days (180) days following the (3) year anniversary of the asset purchase agreement, that the Company immediately forfeit, convey, assign and transfer to the Seller all or any of the Purchased Assets so requested by the Seller for no additional consideration. As of September 30, 2018, there was no net revenue derived from the acquired assets and accordingly, no payments were made on the earnout.

The Company assigned the purchase price of $350,000 to intellectual property which will be amortized over a three (3) year period. Total amortization expense during the three and nine months ended September 30, 2018, was $29,167 and $87,501, respectively, which is included in general and administrative expense in the Condensed Consolidated Statements of Operations.

Asset Acquisition - Soundstr

On April 23, 2018, the Company entered into an agreement with MusicPlay Analytics, LLC (d/b/a Soundstr) (“Soundstr”) whereby the Company acquired the assets of Soundstr, a technology that aims to help businesses pay fairer music license fees based on actual music usage. The Company purchased the assets of Soundstr by agreeing to issue 2,275,000 shares of the Company’s common stock, valued at $68,250, based on the closing market price of the Company’s stock on the date of the agreement, and the Company agreed to assume and pay $234,487 of identified Soundstr obligations within 60 days of April 23, 2018. The assumed Soundstr obligations of $234,487 were outstanding as of September 30, 2018.

The Company assigned the aggregate purchase price of $302,737 to intellectual property which will be amortized over a three (3) year period. Total amortization expense during both the three and nine months ended September 30, 2018, was $25,228 and $44,080, respectively, which is included in general and administrative expense in the Condensed Consolidated Statements of Operations.

XML

RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 4 - RELATED PARTY TRANSACTIONS

DiscLive Network

On July 10, 2017, the Company entered into a Licensing Agreement with RockHouse Live Media Productions, Inc., DBA “DiscLive” or “DiscLive Network” (“DiscLive”) to formalize the terms of the Strategic Alliance entered into by the Company with DiscLive on July 21, 2016. VNUE has acquired an exclusive license from DiscLive, for a period of three years unless earlier terminated under the Agreement, for the use of all its assets, including but not limited to the DiscLive brand, website (including eCommerce platform), intellectual property, inventory, equipment, trade secrets and anything related to its business of “instant live” recording. Under the terms of the Agreement, DiscLive granted the Company a worldwide exclusive license. In exchange for the license, DiscLive will receive a license fee equal to five percent (5%) of any sales derived from the sale and use of the products and services. DiscLive is controlled by our Chief Executive Officer. Revenues of $35,194 and $37,825 and direct cost of revenues of $68,062 and $35,151 during the nine months ended September 30, 2018 and 2017, respectively, were recorded using the assets licensed under this agreement.

Advances from Stockholders / Employees

From time to time, employees of the Company advance funds to the Company for working capital purposes. The advances are unsecured, non-interest bearing and due on demand. As of September 30, 2018 and December 31, 2017, the advances from the employees were $14,720 and $14,720, respectively.

Note payable to President and Significant Stockholder

On December 31, 2014 the Company entered into a note payable agreement with its President, and significant stockholder of the Company. The note is unsecured, non-interest bearing and due on December 31, 2024. As of December 31, 2017, the note payable balance to the officer was $74,131. On April 9, 2018, the Company and its President entered into a conversion and cancellation of debt agreement in which the Company issued common shares for payment in full and the note was retired (see Note 8).

Transactions with Louis Mann

On August 26, 2015, the Company entered into an Advisory Agreement with Louis Mann (“MANN”), a former officer and director with the Company who resigned as an officer and director on August 26, 2015. The Advisory Agreement provided for MANN’s continued and ongoing advisory services to the Company until December 31, 2015 and MANN was to be paid $25,000 for providing such advisory services, which was due and payable on or before December 31, 2015.

On September 15, 2017, the Company entered into a new Advisory Agreement with MANN. The Advisory Agreement provides for MANN’s continued and ongoing advisory services to the Company for a period of nine (6) months and with automatic nine (6) months renewals, unless terminated in accordance with the agreement. MANN is to receive $5,000 per month and 20,000 shares of common stock per month.

As of December 31, 2017, $32,500 of cash compensation was owed to MANN under the Advisory Agreements and included in accounts payable and accrued expenses. On April 5, 2018, the Company and MANN entered into a conversion and cancellation of debt agreement relating to the $32,500 cash compensation balance outstanding at December 31, 2017. The Company issued 650,000 shares of common stock, at $0.02 per share, as payment in full for the $32,500 balance outstanding at December 31, 2017 (see Note 8).

During the nine months ended September 30, 2018 and 2017, the Company incurred costs of $45,000 and $0, respectively, relating to these agreements. As of September 30, 2018, $27,500 of compensation is owed to MANN and included in accounts payable and accrued expenses. 

XML

NOTE PAYABLE (IN DEFAULT)

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 5 - NOTE PAYABLE (IN DEFAULT)

On December 17, 2015, the Company issued a Promissory Note in the principal amount of $9,000. The note is due within 10 business days of the Company receiving a notice of effectiveness of its Form S-1 filed on February 22, 2016. Failure to make payment during that 10 business day period shall constitute an Event of Default, as a result of which the note will become immediately due and payable and the balance will bear interest at 7%. The Company’s Form S-1 was declared effective on March 8, 2016 and payment was due before March 22, 2016. The Company did not repay the note before March 22, 2016; therefore, the note is in default with an interest rate of 7%. The balance of the note payable outstanding was $9,000 as of September 30, 2018 and December 31, 2017, respectively.

XML

CONVERTIBLE NOTES PAYABLE

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 6 - CONVERTIBLE NOTES PAYABLE

Convertible notes payable consist of the following:

		As of
		September 30,			December 31,
		2018			2017
Various Convertible Notes	(a)	$	45,000		$	55,000
Ylimit, LLC Convertible Notes	(b)		707,500			517,000
Crossover Capital Fund II,LLC Convertible Notes	(c)		82,360			61,000
Golock Capital, LLC Convertible Notes	(d)		231,750			191,750
DBW Investments	(e)		56,000			21,000
Black Ice Advisors	(f)		57,750			-
Power Up Lending Group	(g)		98,000			-
2 Doors	(h)		15,000			-
Total Convertible Notes			1,293,360			845,750
Discount			(269,029	)		(198,025	)
Convertible notes, net		$	1,024,331		$	647,725

_____________

(a)

In August 2014 the Company issued a series of convertible notes with various interest rates ranging up to 10% per annum. The Note Conversion Price is determined as follows: (a) if the Note is converted upon the Next Equity Financing, an amount equal to 80% of the price paid per share paid by the investors in the Next Equity Financing; (b) if the Note is converted in the event of a Corporate Transaction, a price per share derived by dividing a “pre-money” valuation of $8,000,000 by the number of shares outstanding immediately prior to the time of such conversion, on a fully diluted basis; or (c) if the Note is converted as part of a Maturity Conversion, a price per unit derived by dividing a “pre-money” valuation of $8,000,000 by the total number of units (restricted and non-restricted) outstanding immediately prior to the time of such conversion, on a fully diluted basis. The notes are due and payable on demand at any time after the earlier of (i) 36 months following the note issuance or (ii) the consummation of a corporate transaction if not previously converted. The balance of the notes outstanding was $55,000 as of December 31, 2017. On April 8, 2018, a note holder elected to convert a $10,000 convertible note plus outstanding accrued interest of $3,652 into 200,000 shares of the Company’s common at $0.02 per share (see Note 8). The balance of the notes outstanding was $45,000 as of September 30, 2018, of which $30,000 was due to related parties.

(b)

On May 9, 2016 the Company issued a convertible note to YLimit, LLC in the principal amount of $100,000 with interest at 10% per annum and due on May 9, 2018. The note is secured by the Company’s rights, titles and interests in all the Company’s tangible and intangible assets, including intellectual property and proprietary software whether existing now or created in the future. On August 25, 2017, the Note was amended to authorize total borrowings on this Note to $517,000, and as such an additional $217,000 was advanced to the Company with the terms remaining the same except that the conversion feature was modified to state that all borrowings under the note will be converted at 85% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share.  The balance of the notes outstanding was $517,000 as of December 31, 2017 and the balance of the debt discount was $137,358. On April 12, 2018 and again on August 15, 2018, the Company and Ylimit, LLC entered into an amendment to the original secured convertible promissory note. The amendments increased the borrowing limits by $190,500 to a total of $707,500, and extended the maturity date to May 9, 2019. In addition, the amendment on April 12, 2018 modified the conversion feature to state that all borrowings under the note will be converted at 75% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. This feature gave rise to a derivative liability of $135,900 during the period ended September 30, 2018 that is discussed below. During the nine months ended September 30, 2018, the Company borrowed an additional $190,500. The balance of notes outstanding was $707,500 as of September 30, 2018 and the balance of the debt discount was $120,054.

(c)

On August 21, 2017, the Company issued a convertible note to Crossover Capital Fund II, LLC (the “Buyer”) in the principal amount of $61,000 with an interest rate of 8% per annum and a maturity date of August 21, 2018. The note included an original issue discount of $6,000. The note is convertible into shares of common stock of the Company at 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. The balance of the note outstanding was $61,000 as of December 31, 2017. During the nine months ended September 30, 2018, the Buyer elected to convert $17,140 of outstanding principal and $4,960 of outstanding accrued interest into 4,200,000 shares of the Company’s common at $0.005 per share.

On March 2, 2018, the Company issued a second convertible note to Crossover Capital Fund II, LLC (the “Buyer”) in the principal amount of $38,500 with an interest rate of 10% per annum and a maturity date of December 2, 2018. The note included an original issue discount of $3,500. The note is convertible into shares of common stock of the Company at the lower of (i) $0.019 per share or, (ii) 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. This feature gave rise to a derivative liability of $116,098 that is discussed below. In the event of default, as defined in the note agreement, interest shall accrue at a default interest rate of 19% per annum or at the highest rate of interest permitted by law, whichever is less. If the Company loses the bid price for its stock in the market (including the OTC marketplace or other exchange) or the Company’s common stock is delisted from an exchange or if trading has been suspended for more than 10 consecutive days, the outstanding principal amounts would increase 20% or 50%, respectively. The aggregate balance of the notes outstanding, and the related debt discounts was $82,360 and $8,820 as of September 30, 2018, respectively.

(d)

From September 1, 2017 to December 31, 2017, the Company issued convertible notes to Golock Capital, LLC (“Lender”) in the aggregate principal amount of $191,750 with an interest rate at 10% per annum and maturity dates between June 1, 2018 and August 31, 2018. The notes are convertible into shares of the Company’s common stock at prices between $0.015 and $0.02 per share. As additional consideration for the Lender to enter into these agreements with the Company, the Company issued warrants to the Lender to acquire in the aggregate 4,804,708 shares of the Company’s common stock at a weighted average exercise price of $0.014 per share. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The balance of the notes outstanding and the related debt discount was $191,750 and $19,652, respectively, as of December 31, 2017.

On February 2, 2018, the Company issued a convertible note to Golock Capital, LLC (“Lender”) in the principal amount of $40,000 with an interest rate at 10% per annum and a maturity date of November 2, 2018. The note included an original issue discount of $5,000. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 2,500,000 shares of the Company’s common stock at an exercise price of $0.015 per share that expire three years from the date of grant. The relative fair value of the warrants, the original issue discount and the beneficial conversion feature totaling $40,000 was recorded as a debt discount and will be amortized to interest expense over the term of the note. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The aggregate balance of the notes outstanding, and the related debt discount was $231,750 and $4,835, respectively, as of September 30, 2018.

(e)

On December 20, 2017, the Company issued a convertible note to DBW Investments, LLC (“Lender”) in the principal amount of $21,000 with an interest rate of 10% per annum and a maturity date of September 20, 2018. The note included an original issue discount of $1,000. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued a warrant to the Lender for 200,000 shares of the Company’s common stock at an exercise price of $0.01 per share. The balance of the note outstanding and the debt discount was $21,000 and $2,073, respectively, as of December 31, 2017.

On January 18, 2018, the Company issued a second convertible note to DBW Investments, LLC (“Lender”) in the principal amount of $35,000, which included an original issue discount of $5,000, with an interest rate at 10% per annum and a maturity date of October 18, 2018. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 500,000 shares of the Company’s common stock at an exercise price of $0.015 per share that expire three years from the date of grant. The relative fair value of the warrants, the original issue discount and the beneficial conversion feature totaling $10,367 was recorded as a debt discount and will be amortized to interest expense over the term of the note. The aggregate balance of the notes outstanding, and the related debt discount was $56,000 and $684, respectively, as of September 30, 2018.

(f)	On September 6, 2018, the Company issued a convertible note to Black Ice Advisors, LLC (the “Buyer”) in the principal amount of $57,750 with an interest rate of 12% per annum (22% on default) and a maturity date of September 4, 2019. The note is convertible into shares of common stock of the Company at a 38% discount of the lowest trading price for the Company’s common stock during the prior twenty (20) trading day period. This feature gave rise to a derivative liability of $81,092 that is discussed below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 31,818,000 shares of its common stock. The balance of the note outstanding, and the related debt discount was $57,750 and $53,932, respectively, as of September 30, 2018.
(g)	On July 9, 2018 and August 30, 2019, the Company issued two convertible notes to Power Up Lending Group Ltd. (the “Buyer”) in the principal amounts of $63,000 and $35,000, respectively. The notes carry an interest rate is 12% per annum (22% on default) and a maturity date of July 9, 2019 and August 30, 2019. The notes are convertible into shares of common stock of the Company at a 38% discount of the average of the two (2) lowest closing bid prices for the Company’s common stock during the prior fifteen (15) trading day period. This feature gave rise to a derivative liability of $166,862 that is disused below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible notes are subject to prepayment penalties. The Company instructed its transfer agent to reserve 51,138,520 shares of its common stock. The aggregate balance of the notes outstanding, and the related debt discount was $98,000 and $80,701, respectively, as of September 30, 2018.
(h)	On April 12, 2018, the Company issued a convertible note to 2 Doors Management, LLC (“Lender”) in the principal amount of $15,000 with an interest rate of 10% per annum, and a maturity date of January 12, 2019. The convertible note was issued in conjunction with a prior year legal settlement with a vendor for which $15,000 was previously included in the Company’s accounts payable and accrued expenses balance on the Company’s consolidated balance sheet. No cash was received for the convertible note. The convertible note can be prepaid without penalty. In the event of default, the interest rate increases to the highest rate legally allowed. The note is convertible into shares of the Company’s common stock at $0.08 per share. In the event the Company successfully closes on a private offering of $1,000,000 or more, the Lender at closing of the offering may choose to either convert the convertible note into shares of the Company’s common stock at $0.08 per share or request repayment of up to 100 percent of the remaining principal and interest of the convertible note. The balance of the note outstanding was $15,000 as of September 30, 2018.

For YLimit, LLC (b), Crossover Capital Fund II, LLC (c), Black Ice Advisors (f), and Power Up Lending Group (g) above, the Company considered the current FASB guidance of “Contracts in Entity’s Own Stock” which indicates that any adjustment to the fixed amount (either conversion price or number of shares) of the instrument regardless of the probability of whether or not within the issuers’ control means the instrument is not indexed to the issuer’s own stock. Accordingly, the Company determined that the conversion prices of the Notes were not a fixed amount because they were either subject to an adjustment based on the occurrence of future offerings or events or the conversion price was variable. As a result, the Company determined that the conversion features of the Notes were not considered indexed to the Company’s own stock and characterized the fair value of the conversion features as derivative liabilities upon issuance. The Company determined that upon issuance of the Notes, the initial fair value of the embedded conversion feature was recorded as debt discount offsetting the fair value of the Notes and the remainder recorded as financing costs in the Consolidated Statement of Operations. The discount is being amortized using the effective interest rate method over the life of the debt instruments.

The balance of the unamortized discount at December 31, 2017, was $198,025. During the nine months ended September 30, 2018, the Company issued $474,750 of convertible notes whose conversion features created a derivative liability upon issuance with a fair value of $499,952, of which $326,650 was recorded as a valuation discount, and the remaining $173,302 was recorded as a financing cost. In addition, the Company recorded debt discount of $40,367 related to warrants issued in conjunction with the issuance of convertible notes totaling $75,000 during the period and debt discount of $13,500 relating to issuance costs. During the nine months ended September 30, 2018, amortization of debt discount was $309,513. The unamortized balance of the debt discount was $269,029 as of September 30, 2018.

For the purposes of Balance Sheet presentation, convertible notes payable have been presented as follows:

	September 30, 2018		December 31, 2017
Convertible notes payable, net	$	994,331	$	617,725
Convertible notes payable, related party, net		30,000		30,000
Total	$	1,024,331	$	647,725

XML

DERIVATIVE LIABILITY

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 7 - DERIVATIVE LIABILITY

The FASB has issued authoritative guidance whereby instruments which do not have fixed settlement provisions are deemed to be derivative instruments. The conversion prices of the Notes described in Note 6 were not a fixed amount because they were either subject to an adjustment based on the occurrence of future offerings or events or they were variable. Since the number of shares is not explicitly limited, the Company is unable to conclude that enough authorized and unissued shares are available to settle the conversion option. In accordance with the FASB authoritative guidance, the conversion features have been characterized as derivative liabilities to be re-measured at the end of every reporting period with the change in value reported in the statement of operations.

65279;As of September 30, 2018 and December 31, 2017, the derivative liabilities were valued using a probability weighted average Black-Scholes-Merton pricing model with the following assumptions:

	September 30, 2018			Issued During 2018			December 31, 2017
Exercise Price	$ 0.005 – 0.035			$ 0.005 – 0.035			$ 0.002 – 0.108
Stock Price	$	0.016		$ 0.010 - 0.037			$	0.109
Risk-free interest rate		2.59	%	1.79 – 2.61%			0.84 – 1.24%
Expected volatility		293	%	261% - 388%				358	%
Expected life (in years)		1.000		1.000 – 1.304				1.000
Expected dividend yield		0	%		0	%		0	%
Fair Value:	$	865,841		$	499,925		$	866,873

The risk-free interest rate was based on rates established by the Federal Reserve Bank. The Company uses the historical volatility of its common stock to estimate the future volatility for its common stock. The expected life of the conversion feature of the notes was based on the remaining term of the notes. The expected dividend yield was based on the fact that the Company has not customarily paid dividends in the past and does not expect to pay dividends in the future.

During the nine months ended September 30, 2018, the Company recognized $390,129 as other income, which represented the change in the value of the derivative from the respective prior period. In addition, the Company recognized derivative liabilities of $499,952 upon issuance of convertible notes and recognized a gain on extinguishment of derivative liabilities of $110,855 upon the conversion of convertible notes during the period.

XML

STOCKHOLDERS DEFICIT

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 8 - STOCKHOLDERS DEFICIT

Shares issued to settle outstanding obligations

Executive Officers

During the nine months ended September 30, 2018, the Company entered into conversion and cancellation of debt agreements with two executive officers. The Company agreed to convert a note payable for $74,131 and aggregate accrued payroll of $419,805 into 3,746,660 shares of the Company’ stock, valued at $74,933 using the closing market price of the Company’s stock on the date of the conversion and cancellation of debt agreements. The difference between the total executive obligations converted of $493,936, and the market value of the shares issued of $74,933, was recorded as contributed capital of $419,003 in the condensed consolidated statements of stockholders’ deficit for the nine months ended September 30, 2018.

Vendors

During the nine months ended September 30, 2018, the Company entered into conversion and cancellation of debt agreements with several of its vendors. The Company agreed to convert $202,094 of outstanding vendor obligations into 5,616,086 shares of the Company’ stock, valued at $160,983 using the closing market price of the Company’s stock on the date of the conversion and cancellation of debt agreements. The difference between the total vendor obligations converted of $202,094, and the market value of the shares issued of $160,983, was recorded as a gain on settlement of obligations of $41,111 in other income in the condensed consolidated statements of operations for the nine months ended September 30, 2018.

Conversion of Debt

On April 8, 2018 and April 12, 2018, the Company entered into conversion and cancellation of debt agreements relating to two outstanding convertible notes. The Company agreed to convert the outstanding aggregate principal and interest balances of $35,752 into 4,400,000 shares of common stock with a fair value of $150,000, and recorded a loss on cancellation of debt of $114,248.

Shares issued for services

In May and July of 2018, the Company issued an aggregate of 1,300,000 shares valued at $32,500, for services received relating to consulting agreements.

Shares issued for acquisition

On July 27, 2018, the Company issued 2,275,000 shares valued at $68,250, or $0.03 per share, related to an acquisition (see Note 3).

Shares to be issued

As of December 31, 2017, the Company had not yet issued 6,537,352 shares of common stock with a value of $932,734 due for past services provided. During the nine months ended September 30, 2018, the Company issued 3,813,000 shares of common stock with a value of $707,895 related to the prior year unissued shares. In addition, the Company agreed to issue a total of 620,000 shares valued at $13,652, or $0.02 per share, for services rendered. As of September 30, 2018, the Company had not yet issued 3,404,352 shares of common stock with a value of $238,491 for past services provided and an acquisition.

Warrants

A summary of warrant activity for the nine months ended September 30, 2018, is as follows:

	Number of		Weighted - Average
	Warrants		Exercise Price
Outstanding at December 31, 2017		5,004,708	$	0.014
Granted		3,000,000		0.015
Forfeited		-		-
Outstanding at September 30, 2018		8,004,708	$	0.014
Exercisable at September 30, 2018		8,004,708	$	0.014

Information relating to outstanding warrants at September 30, 2018, summarized by exercise price, is as follows:

Outstanding							Exercisable
					Weighted				Weighted
					Average				Average
Range of					Exercise				Exercise
Exercise	Shares		Life in Years		Price		Shares		Price
$0.01 - $0.15		8,004,708		2.14	$	0.014		8,004,708	$	0.014
		8,004,708						8,004,708

During the nine months ended September 30, 2018, the Company issued 3,000,000 warrants with a three (3) year expiration date and an exercise price of $0.015 per share to purchase the Company’s common stock as an inducement to enter into certain convertible note agreements. The aggregate relative fair value of the warrants granted was determined to be $24,085 which was recorded as a debt discount and is being amortized to financing costs over the term of the related convertible notes.

The weighted-average remaining contractual life of warrants outstanding and exercisable at September 30, 2018 was 2.14 years. The intrinsic value of both outstanding and exercisable warrants at September 30, 2018 was $13,353.

XML

COMMITMENT AND CONTINGENCIES

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 9 - COMMITMENT AND CONTINGENCIES

Joint Venture Agreement – Music Reports, Inc.

On September 1, 2018, the Company entered into an initial joint venture (“JV”) agreement with Music Reports, Inc., (“MRI”). Music Reports (musicreports.com), , will initially partner with VNUE to provide Performing Rights Organization (PRO) data to VNUE’s Soundstr MRT (music recognition technology) platform through its extensive Songdex database, and will eventually work with VNUE to integrate automated direct licensing capability and royalty payment and distribution into the Soundstr platform. The initial term of the JV is for six (6) months and requires the Company to Pay MRI fifty percent (50%) of net revenue of a quarterly basis. As of September 30, 2018, no net revenue was generated from the JV.

Litigation – Hughes Media Law Group, Inc.

On December 11, 2015, Hughes Media Law Group, Inc. (“HLMG”) filed a lawsuit against VNUE, Inc. in the Superior Court of King County, Washington, under case number 15-2-30108-0. HMLG claims damages of $130,553 for unpaid legal fees HMLG alleges are owed pursuant to an April 4, 2014 agreement with VNUE Washington, for legal work performed by HMLG for VNUE Washington prior to the Merger. The Complaint sets forth no legal basis for a lawsuit against VNUE, Inc. (Nevada) and does not, in fact, sue VNUE Washington, HMLG’s former client. The Company believes that VNUE, Inc. (Nevada) is not the proper party for this lawsuit, and reserves all available defenses and counterclaims. Under Washington Superior Court rules, VNUE, Inc. (Nevada) if service of process takes place outside of Washington, a defendant has Sixty (60) days from the date on which it was served the Complaint, to file a response setting forth its defenses. On July 25, 2016, the court issued judgment awarding HLMG $133,482 with interest at a rate of 12% per annum. The judgment stipulated that $12,000 be paid within five days of the judgment and payments of $4,000 per month to start in October, 2016. The amount of the settlement has been recorded in accounts payable in the accompanying condensed consolidated balance sheets at December 31, 2017. On April 12, 2018, the Company and Hughes Media Law Group, Inc. (“HLMG”) entered into a conversion and cancellation of debt agreement relating to the outstanding obligation. The Company agreed to convert the total remaining outstanding obligation of $118,065 into 3,935,512 shares of common stock, or $0.03 per share (see Note 8).

XML

SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Note 10 - SUBSEQUENT EVENTS

On October 19, 2018, the Company issued a convertible note to Power Up Lending Group Ltd. (the “Buyer”) in the principal amount of $35,000 with an interest rate of 12% per annum (22% on default) and a maturity date of October 18, 2019. The note is convertible into shares of common stock of the Company at a 38% discount of the two (2) lowest closing bid prices for the Company’s common stock during the prior fifteen (15) trading day period. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 38,602,941 shares of its common stock.

On October 18, 2018, the Company issued a convertible note to a private investor (the “Buyer”) in the principal amount of $50,000 with an interest rate of 10% per annum and a maturity date of March 19, 2020. The note is convertible into shares of common stock of the Company at 75% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. The convertible note is not subject to prepayment penalties.

On October 23, 2018, the Company issued a convertible note to LG Capital Funding, LLC (the “Buyer”) in the principal amount of $52,500 with an interest rate of 8% per annum (24% on default) and a maturity date of October 23, 2019. The note is convertible into shares of common stock of the Company at a 42% discount of the lowest trading price of the Company’s common stock for the twenty (20) prior trading days including the day upon which the notice of conversion is received by the Company. The Buyer is limited to convert no more than 4.90%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 40,640,000 shares of its common stock.

Subsequent to September 30, 2018, the Company issued 2,000,000 shares of common stock, for consulting services, valued at $19,950, or $0.01 per share.

On October 23, 2018, Crossover Capital Fund II, LLC (see Note 6) elected to convert $10,130 of outstanding principal and $370 of outstanding accrued interest into 3,000,000 shares of the Company’s common at $0.0035 per share. 

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2018

Summary Of Significant Accounting Policies

Basis of Consolidation

The Company consolidates all wholly owned and majority-owned subsidiaries in which the Company’s power to control exists. The Company consolidates the following subsidiaries and/or entities:

Name of consolidated subsidiary or Entity	State or other jurisdiction of incorporation or organization	Date of incorporation or formation (date of acquisition/disposition, if applicable)	Attributable interest
VNUE Inc. (formerly TGRI)	The State of Nevada	April 4, 2006 (May 29, 2015)		100	%
VNUE Inc. (VNUE Washington)	The State of Washington	October 16, 2014		100	%
VNUE LLC	The State of Washington	August 1, 2013 (December 3, 2014)		100	%
VNUE Technology Inc.	The State of Washington	October 16, 2014		90	%
VNUE Media Inc.	The State of Washington	October 16, 2014		89	%

VNUE Technology, Inc. and VNUE Media, Inc. were inactive corporations at September 30, 2018 and 2017, respectively. Inter-company balances and transactions have been eliminated.

Revenue Recognition

Effective January 1, 2018, the Company adopted the guidance of Accounting Standards Codification (“ASC”) 606, Revenue from Contracts. The implementation of ASC 606 did not have a material impact on the Company’s condensed consolidated financial statements. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients.

The Company recognizes revenue on the sale of digital video disks (DVD) that contain the recording of live concerts and made available to concert viewers immediately after the show and on-line. Revenue is recognized on the sale of a product when the risk of loss transfers to our customers, and collection of the receivable is reasonably assured, which generally occurs when the product is purchased.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the U.S requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the financial statement date, and reported amounts of revenue and expenses during the reporting period. Significant estimates include the assumptions used to value the derivative liabilities, the valuation allowance for the deferred tax asset and the accruals for potential liabilities. Actual results could differ from these estimates.

Fair Value of Financial Instruments

The Company determines the fair value of its assets and liabilities based on the exchange price in U.S. dollars that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company uses a fair value hierarchy with three levels of inputs, of which the first two are considered observable and the last unobservable, to measure fair value:

· Level 1 — Quoted prices in active markets for identical assets or liabilities.

· Level 2 — Inputs, other than Level 1, that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

· Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The carrying amounts of financial instruments such as cash, and accounts payable and accrued liabilities, approximate the related fair values due to the short-term maturities of these instruments.

The fair value of the derivative liabilities of $865,841 and $866,873 at September 30, 2018 and December 31, 2017, respectively, were valued using Level 2 inputs.

Derivative Financial Instruments

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the condensed consolidated statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date.

Loss per Common Share

Basic earnings (loss) per share are computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of shares of Common Stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation if their effect is antidilutive.

For the nine months ended September 30, 2018 and 2017, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an anti-dilutive effect. As of September 30, 2018 and 2017, we excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from our calculation of earnings per share, as their effect would have been anti-dilutive.

	September 30,
	2018		2017
Convertible Notes Payable		83,918,108		110,015,835
Warrants		8,004,708		1,000,000
Total		91,922,816		111,015,835

Intangible Assets

The Company accounts for intangible assets in accordance with the authoritative guidance issued by the FASB. Intangibles are valued at their fair market value and are amortized taking into account the character of the acquired intangible asset and the expected period of benefit. The Company evaluates intangible assets for impairment, at a minimum, on an annual basis and whenever events or changes in circumstances indicate that the carrying value may not be recoverable from its estimated undiscounted future cash flows. Recoverability of intangible assets is measured by comparing their net book value to the related projected undiscounted cash flows from these assets, considering a number of factors, including past operating results, budgets, economic projections, market trends and product development cycles. If the net book value of the asset exceeds the related undiscounted cash flows, the asset is considered impaired, and a second test is performed to measure the amount of impairment loss.

The Company had intangible assets with a carrying value of $491,989 and $320,833 as of September 30, 2018 and December 31, 2017, respectively. In accordance with ASC Topic 350 – Goodwill and Other Intangible Assets, the Company assesses the carrying value of its intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable and records an impairment charge if the carrying value of such intangible assets is not recoverable and if it exceeds its fair value. While our fiscal year-to-date financial performance has not met our expectations, and the enterprise value of the Company based on the current price of our common stock may fluctuate at or near the recorded level of finite-lived intangible assets, management does not consider these to be events requiring the performance of an impairment test. The Company will continue to monitor its operating results for indicators of impairment and perform additional tests as necessary, which could result in an impairment charge to intangible assets.

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-02, Leases. ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months. ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is in the process of evaluating the impact of ASU 2016-02 on the Company’s financial statements and disclosures.

In July 2017, the FASB issued ASU No. 2017-11, “Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features; (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception” (“ASU 2017-11”). ASU 2017-11 allows companies to exclude a down round feature when determining whether a financial instrument (or embedded conversion feature) is considered indexed to the entity’s own stock. As a result, financial instruments (or embedded conversion features) with down round features may no longer be required to be accounted for as derivative liabilities. A company will recognize the value of a down round feature only when it is triggered, and the strike price has been adjusted downward. For equity-classified freestanding financial instruments, an entity will treat the value of the effect of the down round as a dividend and a reduction of income available to common shareholders in computing basic earnings per share. For convertible instruments with embedded conversion features containing down round provisions, entities will recognize the value of the down round as a beneficial conversion discount to be amortized to earnings. ASU 2017-11 is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The guidance in ASU 2017-11 can be applied using a full or modified retrospective approach. The Company is currently evaluating the impact of the adoption of ASU 2017-11 on the Company’s financial statement presentation or disclosures.

In September 2018, the FASB issued ASU 2018-07, “Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting.” The ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The ASU also clarifies that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Revenue from Contracts with Customers (Topic 606). The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted. The Company is currently assessing the effect that the ASU will have on our financial position, results of operations, and disclosures.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements.

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

9 Months Ended

Sep. 30, 2018

Significant And Critical Accounting Policies And Practices Tables Abstract

Schedule of Principles of Consolidation

Name of consolidated subsidiary or Entity	State or other jurisdiction of incorporation or organization	Date of incorporation or formation (date of acquisition/disposition, if applicable)	Attributable interest
VNUE Inc. (formerly TGRI)	The State of Nevada	April 4, 2006 (May 29, 2015)		100	%
VNUE Inc. (VNUE Washington)	The State of Washington	October 16, 2014		100	%
VNUE LLC	The State of Washington	August 1, 2013 (December 3, 2014)		100	%
VNUE Technology Inc.	The State of Washington	October 16, 2014		90	%
VNUE Media Inc.	The State of Washington	October 16, 2014		89	%

Schedule of Loss per Common Share

	September 30,
	2018		2017
Convertible Notes Payable		83,918,108		110,015,835
Warrants		8,004,708		1,000,000
Total		91,922,816		111,015,835

XML

INTANGIBLE ASSETS AND PURCHASE LIABILITY (Tables)

9 Months Ended

Sep. 30, 2018

Intangible Assets And Purchase Liability

Schedule of Intangible assets

	As of
	September 30,			December 31,
	2018			2017
Intangible assets	$	652,737		$	350,000
Accumulated amortization		(160,748	)		(29,167	)
Intangible assets, net	$	491,989		$	320,833

XML

CONVERTIBLE NOTES PAYABLE (Tables)

9 Months Ended

Sep. 30, 2018

Convertible Notes Payable

Schedule of Convertible notes payable

		As of
		September 30,			December 31,
		2018			2017
Various Convertible Notes	(a)	$	45,000		$	55,000
Ylimit, LLC Convertible Notes	(b)		707,500			517,000
Crossover Capital Fund II,LLC Convertible Notes	(c)		82,360			61,000
Golock Capital, LLC Convertible Notes	(d)		231,750			191,750
DBW Investments	(e)		56,000			21,000
Black Ice Advisors	(f)		57,750			-
Power Up Lending Group	(g)		98,000			-
2 Doors	(h)		15,000			-
Total Convertible Notes			1,293,360			845,750
Discount			(269,029	)		(198,025	)
Convertible notes, net		$	1,024,331		$	647,725

_____________

(a)

In August 2014 the Company issued a series of convertible notes with various interest rates ranging up to 10% per annum. The Note Conversion Price is determined as follows: (a) if the Note is converted upon the Next Equity Financing, an amount equal to 80% of the price paid per share paid by the invtors in the Next Equity Financing; (b) if the Note is converted in the event of a Corporate Transaction, a price per share derived by dividing a “pre-money” valuation of $8,000,000 by the number of shares outstanding immediately prior to the time of such conversion, on a fully diluted basis; or (c) if the Note is converted as part of a Maturity Conversion, a price per unit derived by dividing a “pre-money” valuation of $8,000,000 by the total number of units (restricted and non-restricted) outstanding immediately prior to the time of such conversion, on a fully diluted basis. The notes are due and payable on demand at any time after the earlier of (i) 36 months following the note issuance or (ii) the consummation of a corporate transaction if not previously converted. The balance of the notes outstanding was $55,000 as of December 31, 2017. On April 8, 2018, a note holder elected to convert a $10,000 convertible note plus outstanding accrued interest of $3,652 into 200,000 shares of the Company’s common at $0.02 per share (see Note 8). The balance of the notes outstanding was $45,000 as of September 30, 2018, of which $30,000 was due to related parties.

(b)

On May 9, 2016 the Company issued a convertible note to YLimit, LLC in the principal amount of $100,000 with interest at 10% per annum and due on May 9, 2018. The note is secured by the Company’s rights, titles and interests in all the Company’s tangible and intangible assets, including intellectual property and proprietary software whether existing now or created in the future. On August 25, 2017, the Note was amended to authorize total borrowings on this Note to $517,000, and as such an additional $217,000 was advanced to the Company with the terms remaining the same except that the conversion feature was modified to state that all borrowings under the note will be converted at 85% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share.  The balance of the notes outstanding was $517,000 as of December 31, 2017 and the balance of the debt discount was $137,358. On April 12, 2018 and again on August 15, 2018, the Company and Ylimit, LLC entered into an amendment to the original secured convertible promissory note. The amendments increased the borrowing limits by $190,500 to a total of $707,500, and extended the maturity date to May 9, 2019. In addition, the amendment on April 12, 2018 modified the conversion feature to state that all borrowings under the note will be converted at 75% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. This feature gave rise to a derivative liability of $135,900 during the period ended September 30, 2018 that is discussed below. During the nine months ended September 30, 2018, the Company borrowed an additional $190,500. The balance of notes outstanding was $707,500 as of September 30, 2018 and the balance of the debt discount was $120,054.

(c)

On August 21, 2017, the Company issued a convertible note to Crossover Capital Fund II, LLC (the “Buyer”) in the principal amount of $61,000 with an interest rate of 8% per annum and a maturity date of August 21, 2018. The note included an original issue discount of $6,000. The note is convertible into shares of common stock of the Company at 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. The balance of the note outstanding was $61,000 as of December 31, 2017. During the nine months ended September 30, 2018, the Buyer elected to convert $17,140 of outstanding principal and $4,960 of outstanding accrued interest into 4,200,000 shares of the Company’s common at $0.005 per share.

On March 2, 2018, the Company issued a second convertible note to Crossover Capital Fund II, LLC (the “Buyer”) in the principal amount of $38,500 with an interest rate of 10% per annum and a maturity date of December 2, 2018. The note included an original issue discount of $3,500. The note is convertible into shares of common stock of the Company at the lower of (i) $0.019 per share or, (ii) 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. This feature gave rise to a derivative liability of $116,098 that is discussed below. In the event of default, as defined in the note agreement, interest shall accrue at a default interest rate of 19% per annum or at the highest rate of interest permitted by law, whichever is less. If the Company loses the bid price for its stock in the market (including the OTC marketplace or other exchange) or the Company’s common stock is delisted from an exchange or if trading has been suspended for more than 10 consecutive days, the outstanding principal amounts would increase 20% or 50%, respectively. The aggregate balance of the notes outstanding, and the related debt discounts was $82,360 and $8,820 as of September 30, 2018, respectively.

(d)

From September 1, 2017 to December 31, 2017, the Company issued convertible notes to Golock Capital, LLC (“Lender”) in the aggregate principal amount of $191,750 with an interest rate at 10% per annum and maturity dates between June 1, 2018 and August 31, 2018. The notes are convertible into shares of the Company’s common stock at prices between $0.015 and $0.02 per share. As additional consideration for the Lender to enter into these agreements with the Company, the Company issued warrants to the Lender to acquire in the aggregate 4,804,708 shares of the Company’s common stock at a weighted average exercise price of $0.014 per share. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The balance of the notes outstanding and the related debt discount was $191,750 and $19,652, respectively, as of December 31, 2017.

On February 2, 2018, the Company issued a convertible note to Golock Capital, LLC (“Lender”) in the principal amount of $40,000 with an interest rate at 10% per annum and a maturity date of November 2, 2018. The note included an original issue discount of $5,000. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 2,500,000 shares of the Company’s common stock at an exercise price of $0.015 per share that expire three years from the date of grant. The relative fair value of the warrants, the original issue discount and the beneficial conversion feature totaling $40,000 was recorded as a debt discount and will be amortized to interest expense over the term of the note. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The aggregate balance of the notes outstanding, and the related debt discount was $231,750 and $4,835, respectively, as of September 30, 2018.

(e)

On December 20, 2017, the Company issued a convertible note to DBW Investments, LLC (“Lender”) in the principal amount of $21,000 with an interest rate of 10% per annum and a maturity date of September 20, 2018. The note included an original issue discount of $1,000. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued a warrant to the Lender for 200,000 shares of the Company’s common stock at an exercise price of $0.01 per share. The balance of the note outstanding and the debt discount was $21,000 and $2,073, respectively, as of December 31, 2017.

On January 18, 2018, the Company issued a second convertible note to DBW Investments, LLC (“Lender”) in the principal amount of $35,000, which included an original issue discount of $5,000, with an interest rate at 10% per annum and a maturity date of October 18, 2018. The note is convertible into shares of the Company’s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 500,000 shares of the Company’s common stock at an exercise price of $0.015 per share that expire three years from the date of grant. The relative fair value of the warrants, the original issue discount and the beneficial conversion feature totaling $10,367 was recorded as a debt discount and will be amortized to interest expense over the term of the note. The aggregate balance of the notes outstanding, and the related debt discount was $56,000 and $684, respectively, as of September 30, 2018.

(f)	On September 6, 2018, the Company issued a convertible note to Black Ice Advisors, LLC (the “Buyer”) in the principal amount of $57,750 with an interest rate of 12% per annum (22% on default) and a maturity date of September 4, 2019. The note is convertible into shares of common stock of the Company at a 38% discount of the lowest trading price for the Company’s common stock during the prior twenty (20) trading day period. This feature gave rise to a derivative liability of $81,092 that is discussed below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 31,818,000 shares of its common stock. The balance of the note outstanding, and the related debt discount was $57,750 and $53,932, respectively, as of September 30, 2018.
(g)	On July 9, 2018 and August 30, 2019, the Company issued two convertible notes to Power Up Lending Group Ltd. (the “Buyer”) in the principal amounts of $63,000 and $35,000, respectively. The notes carry an interest rate is 12% per annum (22% on default) and a maturity date of July 9, 2019 and August 30, 2019. The notes are convertible into shares of common stock of the Company at a 38% discount of the average of the two (2) lowest closing bid prices for the Company’s common stock during the prior fifteen (15) trading day period. This feature gave rise to a derivative liability of $166,862 that is disused below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible notes are subject to prepayment penalties. The Company instructed its transfer agent to reserve 51,138,520 shares of its common stock. The aggregate balance of the notes outstanding, and the related debt discount was $98,000 and $80,701, respectively, as of September 30, 2018.
(h)	On April 12, 2018, the Company issued a convertible note to 2 Doors Management, LLC (“Lender”) in the principal amount of $15,000 with an interest rate of 10% per annum, and a maturity date of January 12, 2019. The convertible note was issued in conjunction with a prior year legal settlement with a vendor for which $15,000 was previously included in the Company’s accounts payable and accrued expenses balance on the Company’s consolidated balance sheet. No cash was received for the convertible note. The convertible note can be prepaid without penalty. In the event of default, the interest rate increases to the highest rate legally allowed. The note is convertible into shares of the Company’s common stock at $0.08 per share. In the event the Company successfully closes on a private offering of $1,000,000 or more, the Lender at closing of the offering may choose to either convert the convertible note into shares of the Company’s common stock at $0.08 per share or request repayment of up to 100 percent of the remaining principal and interest of the convertible note. The balance of the note outstanding was $15,000 as of September 30, 2018.

Schedule of convertible notes payable for balance sheet

	September 30, 2018		December 31, 2017
Convertible notes payable, net	$	994,331	$	617,725
Convertible notes payable, related party, net		30,000		30,000
Total	$	1,024,331	$	647,725

XML

DERIVATIVE LIABILITY (Tables)

9 Months Ended

Sep. 30, 2018

Derivative Liability

Schedule of derivative liabilities fair value

	September 30, 2018			Issued During 2018			December 31, 2017
Exercise Price	$ 0.005 – 0.035			$ 0.005 – 0.035			$ 0.002 – 0.108
Stock Price	$	0.016		$ 0.010 - 0.037			$	0.109
Risk-free interest rate		2.59	%	1.79 – 2.61%			0.84 – 1.24%
Expected volatility		293	%	261% - 388%				358	%
Expected life (in years)		1.000		1.000 – 1.304				1.000
Expected dividend yield		0	%		0	%		0	%
Fair Value:	$	865,841		$	499,925		$	866,873

XML

STOCKHOLDERS DEFICIT (Tables)

9 Months Ended

Sep. 30, 2018

Stockholders Deficit

Schedule of warrants

	Number of		Weighted - Average
	Warrants		Exercise Price
Outstanding at December 31, 2017		5,004,708	$	0.014
Granted		3,000,000		0.015
Forfeited		-		-
Outstanding at September 30, 2018		8,004,708	$	0.014
Exercisable at September 30, 2018		8,004,708	$	0.014

Schedule of warrants outstanding and related prices

Outstanding							Exercisable
					Weighted				Weighted
					Average				Average
Range of					Exercise				Exercise
Exercise	Shares		Life in Years		Price		Shares		Price
$0.01 - $0.15		8,004,708		2.14	$	0.014		8,004,708	$	0.014
		8,004,708						8,004,708

XML

BASIS OF PRESENTATION (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017	Dec. 31, 2016
Stockholders' Deficit	$ (2,705,241)		$ (2,705,241)		$ (2,749,637)
Net Cash Used in Operating Activities			(417,139)	$ (318,757)
Cash	39,389	$ 73,195	39,389	73,195	$ 10,278	$ 17,952
Additional borrowing	134,500		134,500
Net loss	$ (555,096)	$ (307,809)	$ (915,293)	$ (1,081,526)
Vnue Inc. formerly TGRI [Member]
State of Incorporation			Nevada
Entity Incorporation, Date of Incorporation			Apr. 04, 2006
TGRI [Member]
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares			50,762,987

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	9 Months Ended
	Sep. 30, 2018
Vnue Inc. formerly TGRI [Member]
State of Incorporation	Nevada
Entity Incorporation, Date of Incorporation	Apr. 04, 2006
Non-controlling Interest, Ownership Percentage by Parent	100.00%
Vnue Inc. Vnue Washington [Member]
State of Incorporation	Washington
Entity Incorporation, Date of Incorporation	Oct. 16, 2014
Non-controlling Interest, Ownership Percentage by Parent	100.00%
Vnue LLC [Member]
State of Incorporation	Washington
Entity Incorporation, Date of Incorporation	Aug. 01, 2013
Non-controlling Interest, Ownership Percentage by Parent	100.00%
Vnue Technology Inc [Member]
State of Incorporation	Washington
Entity Incorporation, Date of Incorporation	Oct. 16, 2014
Non-controlling Interest, Ownership Percentage by Parent	90.00%
Vnue Media Inc [Member]
State of Incorporation	Washington
Entity Incorporation, Date of Incorporation	Oct. 16, 2014
Non-controlling Interest, Ownership Percentage by Parent	89.00%

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - shares	3 Months Ended	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Potentially dilutive securities, outstanding		91,922,816	111,015,835
Warrant [Member]
Potentially dilutive securities, outstanding	1,000,000	8,004,708
Convertible Notes Payable [Member]
Potentially dilutive securities, outstanding	110,015,835	83,918,108

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Significant And Critical Accounting Policies And Practices Details Narrative Abstract
Fair value of derivative liabilities	$ 865,841	$ 866,873
Intangible assets, net	$ 491,989	$ 320,833

XML

INTANGIBLE ASSETS AND PURCHASE LIABILITY (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Intangible Assets And Earnout Liability Details Abstract
Intangible assets	$ 652,737	$ 350,000
Accumulated amortization	(160,748)	(29,167)
Intangible assets, net	$ 491,989	$ 320,833

XML

INTANGIBLE ASSETS AND PURCHASE LIABILITY (Details Narrative) - USD ($)	1 Months Ended	3 Months Ended	9 Months Ended
	Apr. 23, 2018	Sep. 30, 2018	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Purchase price acquisition paid in cash		$ 50,000	$ 50,000
Contingent earn out liability		300,000	300,000		$ 300,000
Aggregate purchase price		350,000	350,000
Amortization of intangible assets			$ 131,581
Amortization term			three (3) year period
Stock issued for purchase assets, shares	2,275,000
Stock issued for purchase assets, amount	$ 68,250
Payment of obligation	234,487
Purchase liability		234,487	$ 234,487
Amortization expense		25,228	44,080
General and Administrative Expense [Member]
Amortization of intangible assets		$ 29,167	$ 87,501
Intellectual Property [Member]
Aggregate purchase price	$ 302,737
Amortization term	three (3) year period

XML

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)		1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 15, 2017	Aug. 26, 2015	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Note payable to officer							$ 74,131
Advances from stockholders			14,720		14,720		14,720
Revenues			14,370		35,194	$ 37,825
Cost of revenues			30,660		68,062	35,151
Incurred costs					45,000	$ 0
Stock issued of common stock, amount
DiscLive Network [Member]
License term					3 years
Licensing fees as a percentage of sales					5.00%
Mann [Member]
Advisory agreement, description	<p style="margin: 0pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The Advisory Agreement provides for MANN’s continued and ongoing advisory services to the Company for a period of nine (9) months and with automatic nine (9) months renewals, unless terminated in accordance with the agreement. MANN is to receive $5,000 per month and 20,000 shares of common stock per month.</font></p>	<p style="margin: 0pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The Advisory Agreement provided for MANN’s continued and ongoing advisory services to the Company until December 31, 2015 and MANN was to be paid $25,000 for providing such advisory services, which was due and payable on or before December 31, 2015.</font></p>
Cash compensation			$ 27,500		$ 27,500		$ 32,500
Stock issued of common stock, shares							650,000
Stock issued of common stock, amount							$ 32,500
Common stock price per share							$ 0.02

XML

NOTE PAYABLE (IN DEFAULT) (Details Narrative) - USD ($)	1 Months Ended
	Dec. 17, 2015	Sep. 30, 2018	Dec. 31, 2017
Note Payable In Default
Debt Instrument, Maturity Date	Mar. 22, 2016
Principal amount	$ 9,000
Interest rate	7.00%
Note payable		$ 9,000	$ 9,000
Note payable description	<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The note is due within 10 business days of the Company receiving a notice of effectiveness of its Form S-1 filed on February 22, 2016. Failure to make payment during that 10 business day period shall constitute an Event of Default, as a result of which the note will become immediately due and payable and the balance will bear interest at 7%.</font></p>

XML

CONVERTIBLE NOTES PAYABLE (Details) - USD ($)	Sep. 30, 2018		Dec. 31, 2017
Debt Instrument [Line Items]
Total Convertible Notes	$ 1,293,360		$ 845,750
Discount	(269,029)		(198,025)
Convertible notes, net	1,024,331		647,725
Various Convertible Notes [Member]
Debt Instrument [Line Items]
Total Convertible Notes	45,000	[1]	55,000
Ylimit, LLC Convertible Notes [Member]
Debt Instrument [Line Items]
Total Convertible Notes	707,500	[2]	517,000
Crossover Capital Fund II, LLC Convertible Notes [Member]
Debt Instrument [Line Items]
Total Convertible Notes	82,360	[3]	61,000
Golock Capital, LLC Convertible Notes [Member]
Debt Instrument [Line Items]
Total Convertible Notes	231,750	[4]	191,750
DBW Investments [Member]
Debt Instrument [Line Items]
Total Convertible Notes	56,000	[5]	21,000
Black Ice Advisors [Member]
Debt Instrument [Line Items]
Total Convertible Notes	57,750	[6]
Power Up Lending Group [Member]
Debt Instrument [Line Items]
Total Convertible Notes	98,000	[7]
2 Doors [Member]
Debt Instrument [Line Items]
Total Convertible Notes	$ 15,000	[8]

[1] (a) In August 2014 the Company issued a series of convertible notes with various interest rates ranging up to 10% per annum. The Note Conversion Price is determined as follows: (a) if the Note is converted upon the Next Equity Financing, an amount equal to 80% of the price paid per share paid by the investors in the Next Equity Financing; (b) if the Note is converted in the event of a Corporate Transaction, a price per share derived by dividing a ?pre-money? valuation of $8,000,000 by the number of shares outstanding immediately prior to the time of such conversion, on a fully diluted basis; or (c) if the Note is converted as part of a Maturity Conversion, a price per unit derived by dividing a ?pre-money? valuation of $8,000,000 by the total number of units (restricted and non-restricted) outstanding immediately prior to the time of such conversion, on a fully diluted basis. The notes are due and payable on demand at any time after the earlier of (i) 36 months following the note issuance or (ii) the consummation of a corporate transaction if not previously converted. The balance of the notes outstanding was $55,000 as of December 31, 2017. On April 8, 2018, a note holder elected to convert a $10,000 convertible note plus outstanding accrued interest of $3,652 into 200,000 shares of the Company?s common at $0.02 per share (see Note 8). The balance of the notes outstanding was $45,000 as of September 30, 2018, of which $30,000 was due to related parties.

[2] (b) On May 9, 2016 the Company issued a convertible note to YLimit, LLC in the principal amount of $100,000 with interest at 10% per annum and due on May 9, 2018. The note is secured by the Company?s rights, titles and interests in all the Company?s tangible and intangible assets, including intellectual property and proprietary software whether existing now or created in the future. On August 25, 2017, the Note was amended to authorize total borrowings on this Note to $517,000, and as such an additional $217,000 was advanced to the Company with the terms remaining the same except that the conversion feature was modified to state that all borrowings under the note will be converted at 85% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. The balance of the notes outstanding was $517,000 as of December 31, 2017 and the balance of the debt discount was $137,358. On April 12, 2018 and again on August 15, 2018, the Company and Ylimit, LLC entered into an amendment to the original secured convertible promissory note. The amendments increased the borrowing limits by $190,500 to a total of $707,500, and extended the maturity date to May 9, 2019. In addition, the amendment on April 12, 2018 modified the conversion feature to state that all borrowings under the note will be converted at 75% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. This feature gave rise to a derivative liability of $135,900 during the period ended September 30, 2018 that is discussed below. During the nine months ended September 30, 2018, the Company borrowed an additional $190,500. The balance of notes outstanding was $707,500 as of September 30, 2018 and the balance of the debt discount was $120,054.

[3] (c) On August 21, 2017, the Company issued a convertible note to Crossover Capital Fund II, LLC (the "Buyer") in the principal amount of $61,000 with an interest rate of 8% per annum and a maturity date of August 21, 2018. The note included an original issue discount of $6,000. The note is convertible into shares of common stock of the Company at 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. The balance of the note outstanding was $61,000 as of December 31, 2017. During the nine months ended September 30, 2018, the Buyer elected to convert $17,140 of outstanding principal and $4,960 of outstanding accrued interest into 4,200,000 shares of the Company's common at $0.005 per share. On March 2, 2018, the Company issued a second convertible note to Crossover Capital Fund II, LLC (the "Buyer") in the principal amount of $38,500 with an interest rate of 10% per annum and a maturity date of December 2, 2018. The note included an original issue discount of $3,500. The note is convertible into shares of common stock of the Company at the lower of (i) $0.019 per share or, (ii) 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. This feature gave rise to a derivative liability of $116,098 that is discussed below. In the event of default, as defined in the note agreement, interest shall accrue at a default interest rate of 19% per annum or at the highest rate of interest permitted by law, whichever is less. If the Company loses the bid price for its stock in the market (including the OTC marketplace or other exchange) or the Company's common stock is delisted from an exchange or if trading has been suspended for more than 10 consecutive days, the outstanding principal amounts would increase 20% or 50%, respectively. The aggregate balance of the notes outstanding, and the related debt discounts was $82,360 and $8,820 as of September 30, 2018, respectively.

[4] (d) From September 1, 2017 to December 31, 2017, the Company issued convertible notes to Golock Capital, LLC ("Lender") in the aggregate principal amount of $191,750 with an interest rate at 10% per annum and maturity dates between June 1, 2018 and August 31, 2018. The notes are convertible into shares of the Company's common stock at prices between $0.015 and $0.02 per share. As additional consideration for the Lender to enter into these agreements with the Company, the Company issued warrants to the Lender to acquire in the aggregate 4,804,708 shares of the Company's common stock at a weighted average exercise price of $0.014 per share. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The balance of the notes outstanding and the related debt discount was $191,750 and $19,652, respectively, as of December 31, 2017. On February 2, 2018, the Company issued a convertible note to Golock Capital, LLC ("Lender") in the principal amount of $40,000 with an interest rate at 10% per annum and a maturity date of November 2, 2018. The note included an original issue discount of $5,000. The note is convertible into shares of the Company's common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 2,500,000 shares of the Company?s common stock at an exercise price of $0.015 per share that expire three years from the date of grant. The relative fair value of the warrants, the original issue discount and the beneficial conversion feature totaling $40,000 was recorded as a debt discount and will be amortized to interest expense over the term of the note. In addition, the Lender shall have the first right of refusal as to any future funding of Borrower in that Lender shall have the right to provide all or a portion of the funding upon the same terms as those offered in writing by any third party or contained in any private placement of borrower. The Lender, upon conversion, shall have piggy back registration rights for all of its common stock shares in any registration or post-effective amendment to any registration initiated by Borrower with the Securities and Exchange Commission. The aggregate balance of the notes outstanding, and the related debt discount was $231,750 and $4,835, respectively, as of September 30, 2018.

[5] (e) On December 20, 2017, the Company issued a convertible note to DBW Investments, LLC (?Lender?) in the principal amount of $21,000 with an interest rate of 10% per annum and a maturity date of September 20, 2018. The note included an original issue discount of $1,000. The note is convertible into shares of the Company?s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued a warrant to the Lender for 200,000 shares of the Company?s common stock at an exercise price of $0.01 per share. The balance of the note outstanding and the debt discount was $21,000 and $2,073, respectively, as of December 31, 2017. On January 18, 2018, the Company issued a second convertible note to DBW Investments, LLC (?Lender?) in the principal amount of $35,000, which included an original issue discount of $5,000, with an interest rate at 10% per annum and a maturity date of October 18, 2018. The note is convertible into shares of the Company?s common stock at $0.015 per share. As additional consideration for the Lender to enter into this agreement with the Company, the Company issued warrants to the Lender to acquire in the aggregate 500,000 shares of the Company?s common stock at an exercise price of $0.015 per share that expire three years from the date of grant. The relative fair value of the warrants, the original issue discount and the beneficial conversion feature totaling $10,367 was recorded as a debt discount and will be amortized to interest expense over the term of the note. The aggregate balance of the notes outstanding, and the related debt discount was $56,000 and $684, respectively, as of September 30, 2018.

[6] (f) On September 6, 2018, the Company issued a convertible note to Black Ice Advisors, LLC (the ?Buyer?) in the principal amount of $57,750 with an interest rate of 12% per annum (22% on default) and a maturity date of September 4, 2019. The note is convertible into shares of common stock of the Company at a 38% discount of the lowest trading price for the Company?s common stock during the prior twenty (20) trading day period. This feature gave rise to a derivative liability of $81,092 that is discussed below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 31,818,000 shares of its common stock. The balance of the note outstanding, and the related debt discount was $57,750 and $53,932, respectively, as of September 30, 2018.

[7] (g) On July 9, 2018 and August 30, 2019, the Company issued two convertible notes to Power Up Lending Group Ltd. (the "Buyer") in the principal amounts of $63,000 and $35,000, respectively. The notes carry an interest rate is 12% per annum (22% on default) and a maturity date of July 9, 2019 and August 30, 2019. The notes are convertible into shares of common stock of the Company at a 38% discount of the average of the two (2) lowest closing bid prices for the Company's common stock during the prior fifteen (15) trading day period. This feature gave rise to a derivative liability of $166,862 that is disused below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible notes are subject to prepayment penalties. The Company instructed its transfer agent to reserve 51,138,520 shares of its common stock. The aggregate balance of the notes outstanding, and the related debt discount was $98,000 and $80,701, respectively, as of September 30, 2018.

[8] (h) On April 12, 2018, the Company issued a convertible note to 2 Doors Management, LLC (?Lender?) in the principal amount of $15,000 with an interest rate of 10% per annum, and a maturity date of January 12, 2019. The convertible note was issued in conjunction with a prior year legal settlement with a vendor for which $15,000 was previously included in the Company?s accounts payable and accrued expenses balance on the Company?s consolidated balance sheet. No cash was received for the convertible note. The convertible note can be prepaid without penalty. In the event of default, the interest rate increases to the highest rate legally allowed. The note is convertible into shares of the Company?s common stock at $0.08 per share. In the event the Company successfully closes on a private offering of $1,000,000 or more, the Lender at closing of the offering may choose to either convert the convertible note into shares of the Company?s common stock at $0.08 per share or request repayment of up to 100 percent of the remaining principal and interest of the convertible note. The balance of the note outstanding was $15,000 as of September 30, 2018.

XML

CONVERTIBLE NOTES PAYABLE (Details) (Parenthetical) - USD ($)								1 Months Ended							9 Months Ended
	Sep. 06, 2018	Jul. 09, 2018	Apr. 12, 2018	Apr. 08, 2018	Mar. 02, 2018	Feb. 02, 2018	May 09, 2016	Aug. 30, 2019	Jan. 18, 2018	Dec. 20, 2017	Aug. 25, 2017	Aug. 21, 2017	Dec. 17, 2015	Aug. 31, 2014	Sep. 30, 2018		Dec. 31, 2017	Apr. 12, 2017
Debt Instrument [Line Items]
Debt instrument, face amount															$ 1,293,360		$ 845,750
Accounts payable and accrued expenses															652,082		660,506
Debt Instrument, maturity date													Mar. 22, 2016
Debt discount															269,029		198,025
Accrued interest															138,825		508,460
Power Up Lending Group [Member]
Debt Instrument [Line Items]
Debt instrument, face amount															98,000	[1]
Black Ice Advisors [Member]
Debt Instrument [Line Items]
Debt instrument, face amount															57,750	[2]
Convertible Notes Payable Five [Member] | 2 Doors [Member]
Debt Instrument [Line Items]
Debt instrument, face amount																		$ 15,000
Interest rate																		10.00%
Debt outstanding, balance																		$ 15,000
Accounts payable and accrued expenses																		$ 15,000
Debt Instrument, maturity date			Jan. 12, 2019
Private offering description			<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">In the event the Company successfully closes on a private offering of $1,000,000 or more, the Lender at closing of the offering may choose to either convert the convertible note into shares of the Company’s common stock at $0.08 per share or request repayment of up to 100 percent of the remaining principal and interest of the convertible note.</font></p>
Conversion price per share																		$ 0.08
Convertible Notes Payable Four [Member] | Power Up Lending Group [Member]
Debt Instrument [Line Items]
Debt instrument, face amount		$ 63,000
Interest rate		12.00%
Debt instrument, convertible, terms of conversion feature		<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The notes are convertible into shares of common stock of the Company at a 38% discount of the average of the two (2) lowest closing bid prices for the Company’s common stock during the prior fifteen (15) trading day period. This feature gave rise to a derivative liability of $166,862 that is disused below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company.</font></p>
Debt outstanding, balance															98,000
Debt Instrument, maturity date		Jul. 09, 2019
Debt discount															80,701
Common stock share reserve for future issuance		51,138,520
Convertible Notes Payable Four [Member] | Power Up Lending Group [Member] | Subsequent Event [Member]
Debt Instrument [Line Items]
Debt instrument, face amount								$ 35,000
Debt Instrument, maturity date								Aug. 30, 2019
Convertible Notes Payable Four [Member] | Black Ice Advisors [Member]
Debt Instrument [Line Items]
Debt instrument, face amount	$ 57,750
Interest rate	12.00%
Debt instrument, convertible, terms of conversion feature	<p style="margin: 0pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The note is convertible into shares of common stock of the Company at a 38% discount of the lowest trading price for the Company’s common stock during the prior twenty (20) trading day period. This feature gave rise to a derivative liability of $81,092 that is discussed below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. </font></p>
Debt outstanding, balance															57,750
Debt Instrument, maturity date	Sep. 04, 2019
Debt discount															53,932
Derivative liability	$ 81,092
Common stock share reserve for future issuance	31,818,000
Convertible Notes Payable Four [Member] | DBW Investments, LLC [Member]
Debt Instrument [Line Items]
Debt instrument, face amount									$ 35,000	$ 21,000
Interest rate									10.00%	10.00%
Debt outstanding, balance															56,000		21,000
Debt Instrument, maturity date									Oct. 18, 2018	Sep. 20, 2018
Debt issue discount, amount									$ 5,000	$ 1,000
Debt discount									$ 10,367						684		2,073
Conversion price per share									$ 0.015	$ 0.015
Warrant issued									$ 500,000	$ 200,000
Exercise price									$ 0.015	$ 0.01
Convertible Notes Payable Three [Member] | Golock Capital, LLC [Member]
Debt Instrument [Line Items]
Debt instrument, face amount						$ 40,000
Interest rate						10.00%
Debt outstanding, balance															231,750		191,750
Debt Instrument, maturity date						Nov. 02, 2018
Debt issue discount, amount						$ 5,000
Debt discount						$ 40,000									18,859		19,652
Conversion price per share						$ 0.015
Warrant issued						$ 2,500,000
Exercise price						$ 0.015
Convertible Notes Payable Three [Member] | Golock Capital, LLC [Member] | September 1, 2017 to December 31, 2017 [Member]
Debt Instrument [Line Items]
Debt instrument, face amount															$ 191,750
Interest rate															10.00%
Debt instrument, maturity date, description															June 1, 2018 and August 31, 2018
Warrant issued															$ 4,804,708
Exercise price															$ 0.014
Convertible Notes Payable Three [Member] | Golock Capital, LLC [Member] | September 1, 2017 to December 31, 2017 [Member] | Maximum [Member]
Debt Instrument [Line Items]
Conversion price per share															0.02
Convertible Notes Payable Three [Member] | Golock Capital, LLC [Member] | September 1, 2017 to December 31, 2017 [Member] | Minimum [Member]
Debt Instrument [Line Items]
Conversion price per share															$ 0.015
Convertible Notes Payable Two [Member]
Debt Instrument [Line Items]
Converted shares of common stock															4,200,000
Accrued interest															$ 4,960
Amount of converted shares															$ 17,140
Common stock price per share															$ 0.005
Convertible Notes Payable Two [Member] | Crossover Capital Fund II, LLC [Member]
Debt Instrument [Line Items]
Debt instrument, face amount					$ 38,500							$ 61,000
Interest rate					10.00%							8.00%
Debt instrument, convertible, terms of conversion feature					<p style="margin: 0pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The note is convertible into shares of common stock of the Company at the lower of (i) $0.019 per share or, (ii) 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer requests conversion. This feature gave rise to a derivative liability of $116,098 that is discussed below. In the event of default, as defined in the note agreement, interest shall accrue at a default interest rate of 19% per annum or at the highest rate of interest permitted by law, whichever is less. If the Company loses the bid price for its stock in the market (including the OTC marketplace or other exchange) or the Company’s common stock is delisted from an exchange or if trading has been suspended for more than 10 consecutive days, the outstanding principal amounts would increase 20% or 50%, respectively.</font></p>							<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The note is convertible into shares of common stock of the Company at 50% of the lowest closing bid price in the 20 trading days prior to the day that the Buyer request conversion.</font></p>
Debt outstanding, balance															$ 82,360
Debt Instrument, maturity date					Dec. 02, 2018							Aug. 21, 2018
Debt issue discount, amount					$ 3,500							$ 6,000
Debt discount															8,820
Convertible Notes Payable Two [Member] | August 21, 2017 [Member] | Crossover Capital Fund II, LLC [Member]
Debt Instrument [Line Items]
Debt outstanding, balance																	61,000
Convertible Notes Payable One [Member] | Ylimit, LLC [Member]
Debt Instrument [Line Items]
Debt instrument, face amount							$ 100,000
Interest rate							10.00%
Debt instrument, convertible, terms of conversion feature							<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">the terms remaining the same except that the conversion feature was modified to state that all borrowings under the note will be converted at 85% of the per share stock price in the equity funding</font></p>
Debt outstanding, balance															707,500		517,000
Debt Instrument, maturity date							May 09, 2018
Amendment description of promissory note											<p style="margin: 0pt; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">On April 12, 2018 and again on August 15, 2018, the Company and Ylimit, LLC entered into an amendment to the original secured convertible promissory note. The amendments increased the borrowing limits by $190,500 to a total of $707,500, and extended the maturity date to May 9, 2019. In addition, the amendment on April 12, 2018 modified the conversion feature to state that all borrowings under the note will be converted at 75% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share.</font></p>
Additional amounts borrowed											$ 217,000				190,500
Change in maximum borrowing capacity under the note											$ 517,000
Debt discount															120,054		137,358
Conversion price per share							$ 0.035
Derivative liability															135,900
Convertible Notes Payable [Member]
Debt Instrument [Line Items]
Interest rate														10.00%
Debt instrument, convertible, terms of conversion feature														<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">(a) if the Note is converted upon the Next Equity Financing, an amount equal to 80% of the price paid per share paid by the investors in the Next Equity Financing; (b) if the Note is converted in the event of a Corporate Transaction, a price per share derived by dividing a “pre-money” valuation of $8,000,000 by the number of shares outstanding immediately prior to the time of such conversion, on a fully diluted basis; or (c) if the Note is converted as part of a Maturity Conversion, a price per unit derived by dividing a “pre-money” valuation of $8,000,000 by the total number of units (restricted and non-restricted) outstanding immediately prior to the time of such conversion, on a fully diluted basis.</font></p>
Debt outstanding, balance															45,000		$ 55,000
Debt Instrument, Term														36 months
Due to related parties															$ 30,000
Converted shares of common stock				200,000
Accrued interest				$ 3,652
Amount of converted shares				$ 10,000
Common stock price per share				$ 0.02

[1] (g) On July 9, 2018 and August 30, 2019, the Company issued two convertible notes to Power Up Lending Group Ltd. (the "Buyer") in the principal amounts of $63,000 and $35,000, respectively. The notes carry an interest rate is 12% per annum (22% on default) and a maturity date of July 9, 2019 and August 30, 2019. The notes are convertible into shares of common stock of the Company at a 38% discount of the average of the two (2) lowest closing bid prices for the Company's common stock during the prior fifteen (15) trading day period. This feature gave rise to a derivative liability of $166,862 that is disused below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible notes are subject to prepayment penalties. The Company instructed its transfer agent to reserve 51,138,520 shares of its common stock. The aggregate balance of the notes outstanding, and the related debt discount was $98,000 and $80,701, respectively, as of September 30, 2018.

[2] (f) On September 6, 2018, the Company issued a convertible note to Black Ice Advisors, LLC (the ?Buyer?) in the principal amount of $57,750 with an interest rate of 12% per annum (22% on default) and a maturity date of September 4, 2019. The note is convertible into shares of common stock of the Company at a 38% discount of the lowest trading price for the Company?s common stock during the prior twenty (20) trading day period. This feature gave rise to a derivative liability of $81,092 that is discussed below. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company. The convertible note is subject to prepayment penalties. The Company instructed its transfer agent to reserve 31,818,000 shares of its common stock. The balance of the note outstanding, and the related debt discount was $57,750 and $53,932, respectively, as of September 30, 2018.

XML

CONVERTIBLE NOTES PAYABLE (Details 1) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Convertible Notes Payable Details 1Abstract
Convertible notes payable, net	$ 994,331	$ 617,725
Convertible notes payable, related party, net	30,000	30,000
Total	$ 1,024,331	$ 647,725

XML

CONVERTIBLE NOTES PAYABLE (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Convertible Notes Payable Details Narrative Abstract
Amortization of debt discount	$ 309,513	$ 265,828
Debt Instrument, Unamortized Discount	269,029		$ 198,025
Convertible notes, issued	474,750
Derivative liability	499,952
Proceeds from issuance of convertible notes	75,000
Valuation discount	326,650
Financing cost	173,302
Debt discount related to warrants	40,367
Issuance costs	$ 13,500

XML

DERIVATIVE LIABILITY (Details) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Derivatives, Fair Value [Line Items]
Stock Price	$ 0.016	$ 0.109
Risk-free interest rate	2.59%
Expected volatility	293.00%	358.00%
Expected life (in years)	1 year	1 year
Expected dividend yield	0.00%	0.00%
Fair Value	$ 865,841	$ 866,873
Issued during 2018 [Member]
Derivatives, Fair Value [Line Items]
Expected dividend yield	0.00%
Fair Value	$ 499,925
Minimum [Member]
Derivatives, Fair Value [Line Items]
Exercise Price	$ 0.005	$ 0.002
Risk-free interest rate		0.84%
Minimum [Member] | Issued during 2018 [Member]
Derivatives, Fair Value [Line Items]
Exercise Price	0.005
Stock Price	$ 0.010
Risk-free interest rate	1.79%
Expected volatility	261.00%
Expected life (in years)	1 year
Maximum [Member]
Derivatives, Fair Value [Line Items]
Exercise Price	$ 0.035	$ 0.108
Risk-free interest rate		1.24%
Maximum [Member] | Issued during 2018 [Member]
Derivatives, Fair Value [Line Items]
Exercise Price	0.0035
Stock Price	$ 0.037
Risk-free interest rate	2.61%
Expected volatility	388.00%
Expected life (in years)	1 year 36 months 15 days

XML

DERIVATIVE LIABILITY (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Derivative Liability Details Narrative Abstract
Change in the fair value of derivative liability	$ (17,120)	$ 57,467	$ 390,129	$ 38,068
Derivative liabilities	499,952		499,952
Gain on extinguishment of derivative liability	$ 76,326	$ 174,529	$ 110,855	$ 292,838

XML

STOCKHOLDERS DEFICIT (Details) - Warrant [Member]	9 Months Ended
	Sep. 30, 2018 $ / shares shares
Number of Outstanding | shares	5,004,708
Granted | shares	3,000,000
Forfeited | shares
Number of Outstanding | shares	8,004,708
Number of Outstanding, Exercisable | shares	8,004,708
Weighted average exercise price outstanding | $ / shares	$ 0.014
Granted | $ / shares	0.015
Forfeited | $ / shares
Weighted average exercise price outstanding | $ / shares	0.014
Weighted Average Exercise Price, Exercisable | $ / shares	$ 0.014

XML

STOCKHOLDERS DEFICIT (Details 1) - Warrant [Member]	9 Months Ended
	Sep. 30, 2018 $ / shares shares
Number of Outstanding | shares	8,004,708
Weighted Average Remaining Contractual Life (Years)	2 years 1 month 20 days
Weighted average exercise price outstanding	$ 0.014
Number of Outstanding, Exercisable | shares	8,004,708
Weighted Average Exercise Price, Exercisable	$ 0.014
Minimum [Member]
Range of Exercise price	0.01
Maximum [Member]
Range of Exercise price	$ 0.015

XML

STOCKHOLDERS DEFICIT (Details Narrative) - USD ($)		1 Months Ended			3 Months Ended		9 Months Ended		12 Months Ended
	May 11, 2018	Jul. 31, 2018	Jul. 27, 2018	Apr. 23, 2018	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Class of Stock [Line Items]
Capital contribution upon conversion of accrued payroll for officers							$ 419,003
Gain on settlement of obligations							41,111
Loss on extinguishment of debt					70,000		114,248
Shares issued for services received, Amount							46,152
Stock issued for purchase assets, Shares				2,275,000
Stock issued for purchase assets, Amount				$ 68,250
Fair value of warrants and beneficial conversion feature related to convertible notes payable recorded as debt discount							40,367
Accrued payroll					138,825		138,825		$ 508,460
Note payable to officer									$ 74,131
Consulting Agreement [Member]
Class of Stock [Line Items]
Shares issued for services received, Shares	1,300,000	1,300,000
Shares issued for services received, Amount	$ 32,500	$ 32,500
Debt Agreement [Member] | Vendors [Member]
Class of Stock [Line Items]
Debt conversion amount to be converted							$ 202,094
Debt conversion converted instrument shares issued, Shares							5,616,086
Debt conversion converted instrument shares issued, Value							$ 160,983
Gain on settlement of obligations							41,111
Debt Agreement [Member] | Two Executive Officers [Member]
Class of Stock [Line Items]
Debt conversion amount to be converted							$ 493,936
Debt conversion converted instrument shares issued, Shares							3,746,660
Debt conversion converted instrument shares issued, Value							$ 74,933
Capital contribution upon conversion of accrued payroll for officers							419,003
Accrued payroll					419,805		419,805
Note payable to officer					$ 74,131		$ 74,131
Debt Agreement [Member] | On April 8, 2018 and April 12, 2018 [Member]
Class of Stock [Line Items]
Debt conversion converted instrument shares issued, Shares							400,000
Loss on extinguishment of debt							$ 114,248
Debt convertible converted aggregate principal amount							$ 35,752
Fair value of common stock							150,000
Acquisition [Member]
Class of Stock [Line Items]
Stock issued for purchase assets, Shares			2,275,000
Stock issued for purchase assets, Amount			$ 68,250
Exercise price per share			$ 0.03
Warrant [Member]
Class of Stock [Line Items]
Warrants granted							3,000,000
Fair value of warrants granted							$ 24,085
Exercise price per share							$ 0.015
Expected life							3 years
Weighted-average remaining contractual life of warrants							2 years 1 month 20 days
Intrinsic value							$ 13,353
Common Stock
Class of Stock [Line Items]
Shares issued for services received, Shares							1,300,000
Shares issued for services received, Amount							$ 130
Common stock issued during period, Shares							3,813,000
Common stock issued during period, Amount							$ 707,895
Stock issued for purchase assets, Shares							620,000
Stock issued for purchase assets, Amount							$ 13,652
Share issued price per share					$ 0.02		$ 0.02
Fair value of warrants and beneficial conversion feature related to convertible notes payable recorded as debt discount
Stock not yet shares issued during the period, Shares							3,404,352		6,537,352
Stock not yet shares issued during the period, Amount							$ 238,491		$ 932,734

XML

COMMITMENT AND CONTINGENCIES (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Other Commitments [Line Items]
Common stock, shares issued	95,485,816	74,335,070
Hughes Media Law Group Inc [Member]
Other Commitments [Line Items]
Defendant period	90 days
Common stock, shares issued	3,935,512
Common stock shares outstanding obligations	$ 118,065
Common stock value per share	$ 0.03
Hughes Media Law Group Inc [Member] | July 25, 2016 [Member]
Other Commitments [Line Items]
Judgment awarded	$ 133,482
Interest rate	12.00%
Initial judgment payment	$ 12,000
Initial judgment payment, description	Paid within five days of the judgment.
Monthly payment	$ 4,000
Hughes Media Law Group Inc [Member] | April 4, 2014 [Member]
Other Commitments [Line Items]
Unpaid legal fees	$ 130,553

XML

SUBSEQUENT EVENTS (Details Narrative) - USD ($)	1 Months Ended				9 Months Ended
	Oct. 23, 2018	Oct. 19, 2018	Oct. 18, 2018	Dec. 17, 2015	Sep. 30, 2018
Maturity date				Mar. 22, 2016
Common stock shares issued for consulting services, value
Subsequent Event [Member]
Common stock shares issued for consulting services, shares					2,000,000
Common stock shares issued for consulting services, value					$ 19,950
Common stock shares issued for consulting services, per share					$ 0.01
Subsequent Event [Member] | Crossover Capital Fund II, LLC Convertible Notes [Member]
Convertible note payable principal amount	$ 10,130
Accrued interest	$ 370
Common stock shares issued during period, shares	3,000,000
Common stock shares issued during period, per share	$ 0.0035
Subsequent Event [Member] | Convertible promissory note [Member] | LG Capital Funding, LLC [Member]
Convertible note payable principal amount	$ 52,500
Interest rate	8.00%
Maturity date	Oct. 23, 2019
Convertible conversion description	<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The note is convertible into shares of common stock of the Company at a 42% discount of the lowest trading price of the Company’s common stock for the twenty (20) prior trading days including the day upon which the notice of conversion is received by the Company. The Buyer is limited to convert no more than 4.90%, at any one time, of the issued and outstanding common stock of the Company.</font></p>
Common stock share reserve for future issuance	40,640,000
Subsequent Event [Member] | Convertible promissory note [Member] | Power Up Lending Group Ltd [Member]
Convertible note payable principal amount		$ 35,000
Interest rate		12.00%
Maturity date		Oct. 18, 2019
Convertible conversion description		<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">. The note is convertible into shares of common stock of the Company at a 38% discount of the two (2) lowest closing bid prices for the Company’s common stock during the prior fifteen (15) trading day period. The Buyer is limited to convert no more than 4.99%, at any one time, of the issued and outstanding common stock of the Company.</font></p>
Common stock share reserve for future issuance		38,602,941
Subsequent Event [Member] | Convertible promissory note [Member] | Investor [Member]
Convertible note payable principal amount			$ 50,000
Interest rate			10.00%
Maturity date			Mar. 19, 2020
Convertible conversion description			<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The note is convertible into shares of common stock of the Company at 75% of the per share stock price in the equity funding, but in no event shall the conversion price be less than $0.035 per share. The convertible note is not subject to prepayment penalties.</font></p>