10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended: March 31, 2018

OR

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

For the transition period from to

Commission File Number: 000-52917

FRIENDABLE, INC.

(Exact name of registrant as specified in its charter)

Nevada	98-0546715
(State or other jurisdiction of incorporation)	(I.R.S. Employer Identification No.)

1821 S Bascom Ave., Suite 353, Campbell, California 95008

(Address of principal executive offices) (zip code)

(855) 473-8473

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.	☒ Yes ☐ No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).	☒ Yes ☐ No

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

Large accelerated filer	☐		Accelerated filer	☐
Non-accelerated filer	☐	(Do not check if a smaller reporting company)	Smaller reporting company	☒
			Emerging growth company	☐

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

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

5,553,310,369 shares of common stock outstanding as of May 21, 2018

i

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION	1
ITEM 1. FINANCIAL STATEMENTS	1
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	15
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	22
ITEM 4. CONTROLS AND PROCEDURES	22
PART II - OTHER INFORMATION	23
ITEM 1. LEGAL PROCEEDINGS	23
ITEM 1A. RISK FACTORS	23
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	23
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	23
ITEM 4. MINE SAFETY DISCLOSURES	23
ITEM 5. OTHER INFORMATION	23
ITEM 6. EXHIBITS	24
SIGNATURES	25

ii

As used in this report, the term “the Company” means Friendable, Inc., formerly known as iHookup Social, Inc., and its subsidiary, unless the context clearly indicates otherwise.

Special Note Regarding Forward-Looking Information

This quarterly report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The use of words such as “anticipates,” “estimates,” “expects,” “intends,” “plans” and “believes,” among others, generally identify forward-looking statements. These forward-looking statements include, among others, statements relating to: the Company’s future financial performance, the Company’s business prospects and strategy, anticipated trends and prospects in the industries in which the Company’s businesses operate and other similar matters. These forward-looking statements are based on the Company’s management's expectations and assumptions about future events as of the date of this quarterly report, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict.

Actual results could differ materially from those contained in these forward-looking statements for a variety of reasons, including, among others, the risk factors set forth below. Other unknown or unpredictable factors that could also adversely affect the Company’s business, financial condition and results of operations may arise from time to time. In light of these risks and uncertainties, the forward-looking statements discussed in this quarterly report may not prove to be accurate. Accordingly, you should not place undue reliance on these forward-looking statements, which only reflect the views of the Company’s management as of the date of this quarterly report. The Company does not undertake to update these forward-looking statements

In this quarterly report on Form 10-Q, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the common shares in the Company’s capital stock.

An investment in the Company’s common stock involves a number of very significant risks. You should carefully consider the following risks and uncertainties in addition to other information in this quarterly report on Form 10-Q in evaluating the Company and its business before purchasing shares of the Company’s common stock. The Company’s business, operating results and financial condition could be seriously harmed as a result of the occurrence of any of the following risks. You could lose all or part of your investment due to any of these risks. You should invest in the Company’s common stock only if you can afford to lose your entire investment.

iii

ITEM 1.  FINANCIAL STATEMENTS.

FRIENDABLE, INC.

CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

Consolidated Balance Sheets as of March 31, 2018 and December 31, 2017	2
Consolidated Statements of Comprehensive Loss for the three months ended March 31, 2018 and 2017	3
Consolidated Statements of Stockholders’ Deficiency for the period from December 31, 2016 to March 31, 2018	4
Consolidated Statements of Cash Flows for the three months ended March 31, 2018 and 2017	5
Notes to the Consolidated Financial Statements	6-14

1

FRIENDABLE, INC.

CONSOLIDATED BALANCE SHEETS

(Expressed in US dollars)

ASSETS	March 31, 2018 (Unaudited)	December 31,  2017
Current assets
Cash	$114,714	$-
Accounts receivable	735	-
Prepaid expenses	6,863	6,863
Total current assets	122,312	6,863
Intangible assets (Note 3)	35,000	35,000
TOTAL ASSETS	$157,312	$41,863
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
LIABILITIES
Current liabilities
Accounts payable	$3,094,196	$2,718,832
Convertible debentures short-term (Note 10)	5,504,221	4,807,189
Deferred revenue	-	-
Total current liabilities	8,598,417	7,526,021
Total liabilities	8,598,417	7,526,021
Going concern (Note 1)
Commitments (Note 7)
STOCKHOLDERS' DEFICIT
Preferred stock, 50,000,000 shares authorized at par value of $0.0001, 21,267 (December 31, 2017 – 21,267 ) shares issued and outstanding (Note 4)	2	2
Common stock, 10,000,000,000 shares authorized at par value of $0.0001, 5,553,310,369 (December 31, 2017 –5,010,310,369) shares issued and outstanding (Note 4)	555,331	501,031
Additional paid-in capital	11,369,778	11,157,778
Common stock subscriptions receivable (Note 8)	(4,500)	(4,500)
Deficit	(20,361,716)	(19,138,469)
Total Stockholders' Deficit	(8,441,105)	(7,484,158)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$157,312	$41,863

The accompanying notes are an integral part of these consolidated financial statements.

2

 FRIENDABLE, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Expressed in US dollars)

(Unaudited)

	Three Months Ended March 31, 2018 $	Three Months Ended March 31, 2017 $
REVENUES	3,081	3,043
OPERATING EXPENSES
Accretion and interest expense (Note 10)	867,561	646,264
App hosting (Note 8)	139,455	135,000
Commissions	884	913
General and administrative (Note 8)	217,938	231,801
Product development (Note 8)	-	50,400
Sales and marketing	490	99,494
TOTAL OPERATING EXPENSES	1,226,328	1,163,872
LOSS FROM OPERATIONS	(1,223,247)	(1,160,829)
OTHER EXPENSES
Loss on investment (Note 11)	-	(175,000)
NET LOSS AND COMPREHENSIVE LOSS	(1,223,247)	(1,335,829)
BASIC LOSS PER SHARE	(0.00)	(0.00)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING	5,317,254,813	1,298,101,187

The accompanying notes are an integral part of these consolidated financial statements.

3

FRIENDABLE, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT

FOR THE PERIOD FROM DECEMBER 31, 2016 TO MARCH 31, 2018

(Expressed in US dollars)

Common # Stock Common Stock Amount Preferred # Preferred Stock Amount Additional Paid-in Capital Common Stock Subscriptions Deficit Total

Balance December 31, 2016   1,068,031,823 $106,803 21,655 $2 $9,609,198 $(4,500) $(13,500,287) $(3,788,784)

Shares issued for services	123,220,000	12,322	—	—	56,368	—	—	68,690
Conversion of convertible notes (Note 10)	3,521,332,373	352,133	—	—	410,819	—	—	762,952
Conversion of preferred shares (Note 4)	297,726,173	29,773	(388)	—	(29,773)	—	—	—
Issuance of convertible notes (net) (Note 10)	—	—	—	—	1,111,166	—	—	1,111,166
Net loss for the year	—	—	—	—	—	—	(5,638,182)	(5,638,182)
Balance December 31, 2017	5,010,310,369	$501,031	21,267	$2	$11,157,778	$(4,500)	$(19,138,469)	$(7,484,158,)

Conversion of convertible notes (Note 10)	543,000,000	54,300	—	—	6,000	—	—	60,300
Issuance of convertible notes (net) (Note 10)	—	—	—	—	206,000	—	—	206,000
Net loss for the period	—	—	—	—	—	—	(1,223,247)	(1,223,247)
Balance March 31, 2018	5,553,310,369	$555,331	21,267	$2	$11,369,778	$(4,500)	$(20,361,716)	$(8,441,105)

The accompanying notes are an integral part of these consolidated financial statements.

4

FRIENDABLE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS 

(Expressed in US dollars)

	Three months ended  March 31, 2018	Three months ended  March 31, 2017
Cash Flows from Operating Activities:
Net loss	$(1,223,247)	$(1,335,829)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Interest on convertible debentures	158,898	110,158
Accretion expense	708,663	536,106
Shares issued for services	-	9,440
Loss on investment	-	175,000
Changes in Operating Assets and Liabilities
Increase in accounts receivable	(735)	(796)
Increase (decrease) in accounts payable	264,135	(62,408)
Net Cash Used in Operating Activities	(92,286)	(568,329)
Cash Flows Used in Investing Activities:
Purchase of Investment in Hang With	-	(175,000)
Net Cash Used in Investing Activities	-	(175,000)
Cash Flows Provided by Financing Activities:
Proceeds from convertible debentures (net)	207,000	628,060
Net Cash Provided by Financing Activities	207,000	628,060
Net Increase (Decrease) in Cash	114,714	(115,269)
Cash – Beginning	-	119,804
Cash – Ending	$114,714	$4,535
Supplemental Cash Flow Information:
Cash paid for interest	$—	$—
Cash paid for income taxes	$—	$—
Non-cash Investing and Financing Items:
Shares issued for conversion of debt (net)	$-	$-
Convertible debentures issued to extinguish promissory notes	$-	$-
Cash consists of:
Cash	$114,714	$4,535

The accompanying notes are an integral part of these consolidated financial statements.

5

FRIENDABLE, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE PERIOD ENDED MARCH 31, 2018

(Expressed in US dollars)

1.  NATURE OF BUSINESS AND GOING CONCERN

Friendable, Inc., a Nevada corporation (the “Company”), was incorporated in the State of Nevada as Digital Yearbook Inc.

Effective June 15, 2011, the Company completed a merger with its subsidiary, Titan Iron Ore Corp., a Nevada corporation, which was incorporated solely to effect a change in the Company’s name from “Digital Yearbook Inc.” to “Titan Iron Ore Corp.” The Company then began to pursue business in the area of mining exploration.

On February 3, 2014, the Company entered into an Agreement and Plan of Merger and Reorganization (the “Merger”)with iHookup Operations Corp., a wholly-owned Delaware subsidiary of the Company (“Acquisition Sub”) and iHookup-DE, whereby iHookup-DE was the surviving entity and became the wholly-owned subsidiary of the Company. iHookup-DE’s former stockholders exchanged all of their 6,000 shares of outstanding common stock for 25,000 shares of the Company’s designated Series A Preferred Stock.

The Merger was regarded as a reverse recapitalization whereby iHookup-DE was considered to be the accounting acquirer as its stockholders retained control of the Company after the Merger. On February 3, 2014, the Merger was completed and as a result, iHookup-DE acquired the net liabilities of the Company.

As a result of the Merger, the Company ceased its prior operations and its business became the development and dissemination of a “proximity based” mobile-social media application that facilitates connections between people, utilizing the intelligence of global positioning system and localized recommendations.

On September 28, 2015, the Company filed a Certificate of Amendment to its Articles of Incorporation changing the name of the Company from “iHookup Social, Inc.” to “Friendable, Inc.”. On October 27, 2015, the Company’s trading symbol on the OTC Pink marketplace was changed from “HKUP” to “FDBL”. This change was made in conjunction with the re-branding of the Company’s app from "iHookup Social" to "Friendable".

On June 28, 2017, the Company formed a wholly owned Nevada subsidiary called Fan Pass Inc.

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern, which implies that the Company would continue to realize its assets and discharge its liabilities in the normal course of business. The Company has never paid any dividends and is unlikely to pay dividends or generate earnings in the immediate or foreseeable future. As of March 31, 2018, the Company has a working capital deficiency of $8,476,105 and has an accumulated deficit of $20,361,716 since inception and its operations continue to be funded primarily from sales of its stock and issuance of convertible debentures. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to obtain the necessary financing through the issuance of convertible notes and equity instruments. The consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Management plans to raise financing through the issuance of convertible notes. No assurance can be given that any such additional financing will be available, or that it can be obtained on terms acceptable to the Company and its stockholders.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. The Company’s fiscal year end is December 31.

Use of Estimates

The preparation of these statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions related to the useful life and recoverability of long-lived assets, valuation of convertible debenture conversion options, deferred income tax asset valuations, financial instrument valuations, share-based payments, other equity-based payments, and loss contingencies. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. 

6

FRIENDABLE, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE PERIOD ENDED MARCH 31, 2018

(Expressed in US dollars)

 

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Revenue Recognition

Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. The Company derives revenues from the sale of application software, unlimited messaging subscriptions for periods varying from one to twelve months, and arrangements for virtual gifts and access to special features referred to as coin packs. Revenue from the sale of application software is recognized upon download. Revenue from messaging subscriptions is recognized as revenue ratably over the subscription period beginning on the date the service is made available to customers. Revenue from coin packs is recognized on a consumption basis commensurate with the customer utilization of such resources.

Advertising Costs

The Company’s policy regarding advertising is to expense advertising when incurred. During the quarter ended March 31, 2018, the Company incurred $299 (March 31, 2017: $1,397) in advertising costs.

Cash and Cash Equivalents

The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents.

Intangible Assets

The Company accounts for intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other. The Company assesses potential impairments to intangible assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered.

Intangible assets with finite lives are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of intangible assets with finite lives is measured by comparing the carrying amount of the asset to its fair value. If the future value of the asset is lower than its carrying value, the Company recognizes an impairment loss for the amount by which the carrying value of the asset exceeds the related estimated fair value.

Intangible assets with indefinite lives are tested for impairment annually or more frequently are tested for impairment annually or more frequently if events or changes in circumstances indicate that it is more likely than not that the intangible asset is impaired.

Impairment of Long-Lived Assets

The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows.

If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell.

Stock-based Compensation

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Based Compensation and ASC 505, Equity Based Payments to Non-Employees, which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based awards made to employees and directors, including stock options.

ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option pricing model as its method in determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Company’s expected stock price volatility over the terms of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of comprehensive loss over the requisite service period.

All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

Allowance for Doubtful Accounts

The Company monitors its outstanding receivables for timely payments and potential collection issues. During the quarter ended March 31, 2018 and 2017, the Company did not have any allowance for doubtful accounts.

7

FRIENDABLE, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE PERIOD ENDED MARCH 31, 2018

(Expressed in US dollars)

 

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Financial Instruments

Financial assets and financial liabilities are recognized in the balance sheet when the Company has become party to the contractual provisions of the instruments.

The Company’s financial instruments consist of accounts payable and convertible debentures. The fair values of these financial instruments approximate their carrying value, due to their short term nature, and current market rates for similar financial instruments. Fair value of a financial instrument is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company’s financial instruments recorded at fair value in the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value.

Basic and Diluted Loss Per Share

The Company computes net loss per share in accordance with ASC 260, Earnings per Share.  ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of comprehensive loss. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

As of March 31, 2018, there were approximately 60,719,913,802 potentially dilutive shares outstanding.

Income Taxes

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Income Taxes. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

8

FRIENDABLE, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE PERIOD ENDED MARCH 31, 2018

(Expressed in US dollars)

 

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, “Revenue Recognition” and some cost guidance included in ASC Subtopic 605-35, Revenue Recognition -Construction-Type and Production-Type Contracts”.  ASU 2014-09 requires the disclosure of sufficient information to enable users of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. The Company will also be required to disclose information regarding significant judgments and changes in judgments, and assets recognized from costs incurred to obtain or fulfill a contract. Early adoption is not allowed. ASU 2014-09 provides two methods of retrospective application. The first method would require the Company to apply ASU 2014-09 to each prior reporting period presented. The second method would require the Company to retrospectively apply with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application. The Company is currently evaluating the impact that the adoption of ASU 2014-09 may have on its consolidated financial statements.

3.  INTANGIBLE ASSETS

As at March 31, 2018, the Company owns the Friendable Properties which includes domain names, logos, icons, and registered trademarks for which it paid cash consideration of $35,000.

4.  COMMON AND PREFERRED STOCK

Common Stock:

Issued during 2018

During the quarter ended March 31, 2018, the Company issued 543,000,000 shares of common stock to various convertible note holders for full and partial conversion of the notes (Note 10).

Preferred Stock:

The Series A Preferred Stock is convertible into nine (9) times the number of common stock outstanding until the closing of a Qualified Financing (i.e. the sale and issuance of the Company’s equity securities that results in gross proceeds in excess of $2,500,000).  The number of shares of common stock issued on conversion of preferred stock is based on the ratio of the number of shares of preferred stock converted to the total number of shares of preferred stock outstanding at the date of conversion multiplied by nine (9) times the number of common stock outstanding at the date of conversion.

5.  SHARE PURCHASE WARRANTS

Balance of share purchase warrants as of March 31, 2018 and year ended December 31, 2017 are:

		Weighted Average
		Exercise
	Number of Warrants	Price $
Balance, December 31, 2017	1,096,335,757	0.004
Balance, March 31, 2018	1,096,335,757	0.004

9

FRIENDABLE, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE PERIOD ENDED MARCH 31, 2018

(Expressed in US dollars)

 

6.  STOCK-BASED COMPENSATION

On November 22, 2011, the Board of Directors of the Company (see Note 1) approved a stock option plan (“2011 Stock Option Plan”), the purpose of which is to enhance the Company’s stockholder value and financial performance by attracting, retaining and motivating the Company’s officers, directors, key employees, consultants and its affiliates and to encourage stock ownership by such individuals by providing them with a means to acquire a proprietary interest in the Company’s success through stock ownership. Under the 2011 Stock Option Plan, officers, directors, employees and consultants who provide services to the Company may be granted options to acquire common shares of the Company.   The aggregate number of options authorized by the plan shall not exceed 4,974 shares of common stock of the Company. 

The following table summarizes the options outstanding and exercisable under the 2011 Stock Option Plan as of March 31, 2018:

	Option Price
Expiry Date	Per Share($)	Number
December 21, 2021	1,680	1,725
June 21, 2022	400	500
June 25, 2023	134	850
	$1,044	3,075

The Board of Directors and the stockholders holding a majority of the voting power approved a 2014 Equity Incentive Plan (the “2014 Plan”) on February 28, 2014, with a to be determined effective date. The purpose of the 2014 Plan is to assist the Company and its affiliates in attracting, retaining and providing incentives to employees, directors, consultants and independent contractors who serve the Company and its affiliates by offering them the opportunity to acquire or increase their proprietary interest in the Company and to promote the identification of their interests with those of the stockholders of the Company. The 2014 Plan will also be used to make grants to further reward and incentivize current employees and others.

There are 120,679 shares of common stock reserved for issuance under the 2014 Plan. The Board shall have the power and authority to make grants of stock options to employees, directors, consultants and independent contractors who serve the Company and its affiliates. Any stock options granted under the 2014 Plan shall have an exercise price equal to or greater than the fair market value of the Company’s shares of common stock. Unless otherwise determined by the Board of Directors, stock options shall vest over a four-year period with 25% being vested after the end of one (1) year of service and the remainder vesting equally over a 36-month period.  The Board may award options that may vest based upon the achievement of certain performance milestones. As of March 31, 2018, no options have been awarded under the 2014 Plan.

The following table summarizes the Company’s stock options outstanding and exercisable:

	Number of Options	Weighted Average Exercise Price	Weighted- Average Remaining Contractual Term (years) $	Aggregate Intrinsic Value $
Outstanding and exercisable, December 31, 2016	3,075	1,044	6.57	-
Outstanding and exercisable, December 31, 2017	3,075	1,044	5.57	-
Outstanding and exercisable, March 31, 2018	3,075	1,044	5.32	-

7.  COMMITMENTS

The following table summarizes the Company’s significant contractual obligations as of March 31, 2018:

	$
Employment Agreements (1)		225,000

 (1) Employment agreements with related parties.

10

FRIENDABLE, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE PERIOD ENDED MARCH 31, 2018

(Expressed in US dollars)

 

8.  RELATED PARTY TRANSACTIONS AND BALANCES

During the quarter ended March 31, 2018, the Company incurred $114,800 (2017: 132,300) in salaries to officers and directors with such costs being recorded as general and administrative expenses.

During the quarter ended March 31, 2018, the Company incurred $154,455 (2017: $200,000) in app hosting, app development and rent to a company with two officers and directors in common with such costs being recorded as app hosting, product development and general and administrative expenses.

As of March 31, 2018, the Company had a stock subscription receivable totaling $4,500 (December 31, 2017: $4,500) from an officer and director and from a company with an officer and director in common.

As of March 31, 2018, accounts payable includes $598,833 (December 31, 2017: $481,078) payable to a company with two officers and directors in common, and $566,211 (December 31, 2017: $474,583) payable in salaries to directors and officers of the Company. The amounts are unsecured, non-interest bearing and are due on demand.

The above transactions were recorded at their exchange amounts, being the amounts agreed by the related parties.

9.  FAIR VALUE MEASUREMENTS

ASC 820, Fair Value Measurements and Disclosures, require an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Valuations are based on quoted prices that are readily and regularly available in an active market and do not entail a significant degree of judgment.

Level 2

Level 2 applies to assets or liabilities for which there are other than Level 1 observable inputs such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 2 instruments require more management judgment and subjectivity as compared to Level 1 instruments. For instance: determining which instruments are most similar to the instrument being priced requires management to identify a sample of similar securities based on the coupon rates, maturity, issuer, credit rating and instrument type, and subjectively select an individual security or multiple securities that are deemed most similar to the security being priced; and determining whether a market is considered active requires management judgment.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The determination of fair value for Level 3 instruments requires the most management judgment and subjectivity.

Pursuant to ASC 825, cash is based on Level 1 inputs. The Company believes that the recorded values of accounts receivable and accounts payable approximate their current fair values because of their nature or respective relatively short durations. The fair value of the Company’s convertible debentures approximates their carrying values as the underlying imputed interest rates approximates the estimated current market rate for similar instruments.

As of March 31, 2018, there were no assets or liabilities measured at fair value on a recurring basis presented on the Company’s balance sheet, other than cash. 

11

FRIENDABLE, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE PERIOD ENDED MARCH 31, 2018

(Expressed in US dollars)

 

10.  CONVERTIBLE DEBENTURES

Current Convertible Debentures:

Conversion Feature		Issuance	Net Principal ($)	Discount ($)	Carrying Value ($)	Interest Rate		Maturity Date
a	)	2-Apr-13	5,054	-	5,054	0	%	2-Jan-14
d	)	5-Aug-15	474,900	-	474,900	7	%	5-Feb-17
d	)	5-Aug-15	18,750	-	18,750	7	%	5-Feb-17
c	)	17-Feb-15	102,135	-	102,135	8	%	17-Feb-16
b	)	17-Feb-15	5,000	-	5,000	8	%	17-Feb-16
b	)	27-Feb-15	37,500	-	37,500	8	%	27-Feb-16
b	)	19-Mar-15	53,551	-	53,551	8	%	19-Mar-16
b	)	19-Mar-15	8,000	-	8,000	8	%	19-Mar-16
b	)	11-May-15	50,000	-	50,000	8	%	11-May-16
b	)	2-Jun-15	29,500	-	29,500	8	%	2-Jun-16
b	)	2-Jun-15	45,966	-	45,966	8	%	2-Jun-16
b	)	2-Jun-15	10,000	-	10,000	8	%	2-Jun-16
b	)	2-Jun-15	58,540	-	58,540	8	%	2-Jun-16
b	)	2-Jun-15	35,408	-	35,408	8	%	2-Jun-16
b	)	2-Jun-15	20,758	-	20,758	8	%	2-Jun-16
c	)	11-Jun-15	50,000	-	50,000	8	%	27-Mar-16
b	)	19-Jun-15	30,464	-	30,464	8	%	19-Jun-16
b	)	19-Jun-15	30,000	-	30,000	8	%	19-Jun-16
b	)	19-Jun-15	35,408	-	35,408	8	%	19-Jun-16
b	)	24-Jun-15	37,500	-	37,500	8	%	27-Feb-16
b	)	24-Jun-15	35,000	-	35,000	8	%	12-Feb-16
b	)	24-Jun-15	37,500	-	37,500	8	%	12-Mar-16
b	)	7-Jul-15	75,000	-	75,000	8	%	7-Oct-15
b	)	1-Aug-15	17,408	-	17,408	8	%	4-Aug-16
b	)	1-Aug-15	30,000	-	30,000	8	%	1-Aug-16
b	)	1-Aug-15	35,408	-	35,408	8	%	1-Aug-16
b	)	21-Sep-15	64,744	-	64,744	8	%	21-Sep-16
b	)	3-May-16	50,000	-	50,000	8	%	3-May-17
b	)	3-May-16	50,000	-	50,000	8	%	11-May-16
b	)	3-May-16	29,500	-	29,500	8	%	2-Jun-16
b	)	3-May-16	45,965	-	45,965	8	%	2-Jun-16
b	)	24-May-16	61,571	-	61,571	8	%	24-May-17
b	)	24-May-16	30,464	-	30,464	8	%	19-Jun-16
b	)	26-May-16	157,500	-	157,500	8	%	26-May-17
b	)	15-Jun-16	5,000	-	5,000	8	%	15-Jun-17
d	)	3-Jun-16	160,000	-	160,000	7	%	8-Sep-17
d	)	3-Jun-16	4,000	-	4,000	7	%	8-Sep-17
d	)	15-Jun-16	50,000	-	50,000	7	%	8-Sep-17
d	)	15-Jun-16	1,250	-	1,250	7	%	8-Sep-17
d	)	17-May-16	100,000	-	100,000	7	%	8-Sep-17
d	)	17-May-16	2,500	-	2,500	7	%	8-Sep-17
d	)	20-May-16	110,000	-	110,000	7	%	8-Sep-17
d	)	20-May-16	2,750	-	2,750	7	%	8-Sep-17
d	)	27-Jan-16	250,000	-	250,000	7	%	27-Jul-17
d	)	8-Mar-16	110,000	-	110,000	7	%	8-Sep-17
d	)	27-Jan-16	18,750	-	18,750	7	%	27-Jul-17
d	)	8-Mar-16	5,000	-	5,000	7	%	8-Sep-17
d	)	8-Mar-16	90,000	-	90,000	8	%	8-Sep-17

12

FRIENDABLE, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE PERIOD ENDED MARCH 31, 2018

(Expressed in US dollars)

 

10.  CONVERTIBLE DEBENTURES (CONTINUED)

 

b	)	8-Jul-16	50,000	-	50,000	7	%	8-Sep-17
b	)	4-Aug-16	110,000	-	110,000	7	%	8-Sep-17
d	)	15-Aug-16	157,000	-	157,000	7	%	8-Sep-17
d	)	12-Sep-16	83,000	-	83,000	7	%	8-Sep-17
d	)	8-Jul-16	1,250	-	1,250	7	%	8-Sep-17
d	)	4-Aug-16	2,750	-	2,750	7	%	8-Sep-17
d	)	15-Aug-16	3,925	-	3,925	7	%	8-Sep-17
d	)	12-Sep-16	2,075	-	2,075	7	%	8-Sep-17
d	)	4-Aug-16	110,000	-	110,000	8	%	4-Aug-17
b	)	15-Aug-16	157,500	-	157,500	8	%	15-Aug-17
b	)	8-Sep-16	80,000	-	80,000	8	%	8-Sep-17
b	)	11-Nov-16	80,000	-	80,000	8	%	11-Nov-17
b	)	5-Dec-16	88,000	-	88,000	8	%	5-Dec-17
b	)	9-Jan-17	84,000	-	84,000	8	%	6-Jan-18
b	)	13-Mar-17	32,000	-	32,000	8	%	13-Mar-18
c	)	2-Feb-17	90,198	-	90,198	8	%	2-Feb-18
c	)	15-Mar-17	96,000	-	96,000	8	%	15-Mar-18
d	)	7-Oct-16	465,000	63,912	401,088	7	%	7-Apr-18
d	)	7-Nov-16	295,000	47,914	247,086	7	%	7-May-18
d	)	12-Dec-16	295,000	18,033	276,967	7	%	12-Jun-18
d	)	18-Jan-17	295,000	11,543	283,457	7	%	7-Apr-18
b	)	7-Apr-17	25,000	2,754	22,246	8	%	7-Apr-18
b	)	3-May-17	27,000	9,809	17,191	8	%	3-May-18
c	)	5-May-17	30,000	11,574	18,426	8	%	5-May-18
b	)	2-Jun-17	27,000	14,115	12,885	8	%	2-Jun-18
s) d	)	21-Jul-17	698,258	485,908	212,350	10	%	21-Jul-18
s) d	)	21-Jul-17	24,000	6,917	17,083	10	%	21-Jul-18
			6,176,700	672,479	5,504,221

a)

The conversion price per share equal to the lower of:

i.

100% of the average price of the Company’s common stock for the 5 trading days preceding the conversion date;

ii.

70% of the daily average price of the Company’s common stock for the 10 trading days preceding the conversion date.

b)

The conversion price is equal to 50% of the lowest closing bid price of the Company’s common stock for the 15-20 trading days preceding the conversion date subject to a maximum conversion price ranging from $0.0005-$0.05.

c)

The conversion price equal to 50% of the lowest closing bid price of the Company’s common stock in the 20-25 trading days prior to the conversion.

d)

The conversion price is fixed ranging from $0.0003 - $0.0078.

s)

Convertible debenture is secured

During the quarter ended March 31, 2018, the Company received net proceeds from convertible debentures of $207,000 (2017: $628,060).

During the quarter ended March 31, 2018, $60,300 (2017: $240,484) of convertible debentures were settled by issuing 543,000,000 (2017: 435,823,830) shares of common stock of the Company.

During the quarter ended March 31, 2018, the Company incurred $255 (2017: $29,250) in transaction costs in connection with the issuance of the convertible debentures that have been offset against the carrying values of the related debentures on the issuance date.

During the quarter ended March 31, 2018, the Company incurred $867,561 (2017: $646,264) in accretion and interest expense in connection with the convertible debentures.

13

FRIENDABLE, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE PERIOD ENDED MARCH 31, 2018

(Expressed in US dollars)

 

10.  CONVERTIBLE DEBENTURES (CONTINUED)

At March 31, 2018, convertible debentures with the principal amount of $6,176,700 are subject to a General Security Agreement covering substantially all of the Company’s assets.

The Company has evaluated whether separate financial instruments with the same terms as the conversion features above would meet the characteristics of a derivative instrument as described in paragraphs ASC 815-15-25. The terms of the contracts do not permit net settlement, as the shares delivered upon conversion are not readily convertible to cash. The Company’s trading history indicated that the shares are thinly traded and the market would not absorb the sale of the shares issued upon conversion without significantly affecting the price. As the conversion features would not meet the characteristics of a derivative instrument as described in ASC 815-15-25, the conversion features are not required to be separated from the host instrument and accounted for separately. As a result, at March 31, 2018 the conversion features and non-standard anti-dilution provisions would not meet derivative classification.

Convertible debentures with maturity dates prior to March 31, 2018 are now due on demand.

11.  LOSS ON INVESTMENT AND INTANGIBLE ASSET

On October 7, 2016, the Company entered into a Securities Purchase Agreement (the “Alpha SPA”) with Alpha Capital Anstalt (“Alpha Capital”), to issue and sell up to, in principal amount, $1,615,000 of convertible notes, payable in four tranches (the “Alpha Notes”). The first tranche of $465,000 was funded on October 7, 2016 (the “Initial Closing Date”) and the second, third, and fourth tranches of $375,000 were funded, respectively, during the first week of each of November 2016, December 2016, and January 2017 (the subsequent closing dates and, with the Initial Closing Date, each a “Closing”).

The Company used a portion of the proceeds of each Closing to purchase Series A Convertible Participating Preferred Stock of a private entity named Hang With, Inc. (“Hang With”). Alpha Capital is currently Hang With’s majority shareholder. On October 7, 2016, the Company entered into a Securities Purchase Agreement with Hang With (the “Hang With SPA”) to buy up to 330,397 shares of Hang With’s Series A Convertible Participating Preferred Stock (the “Preferred Stock”) for $750,000. On the Initial Closing Date, the Company paid $225,000 and was to receive 99,118 shares of Preferred Stock. The Company paid Hang With $175,000 on each of the subsequent three Closings. In connection with entering into the Hang With SPA, the Company and Hang With entered into a Software License Agreement (the “License Agreement”) in which Hang With is licensing the intellectual property of the Hang With apps to the Company. As part of the Hang With SPA and as compensation for the Company entering into the License Agreement and the future development agreement, Hang With was to issue 154,185 shares of Preferred Stock on the Initial Closing Date, and was to issue 100,000 shares of its common stock to the Company.

The Company attributed much of the value of Hang With to Hang With management’s representation that, in the history of its own apps, it had a certain amount of total users and a range of monthly active users. Hang With believed, prior to the Hang With SPA being signed, that, with the Company’s investment, the monthly active users would be at the higher end of the range within a short period of time. Based on these representations by management the Company believed that it could specifically market its own apps to the minimum monthly active users of the Hang With app that Hang With management’s represented existed.

The Company believes that, after the November 2016 Closing, the Hang With app was removed for a period of time from the app stores on which it appeared and that the app was shut down for a period of time. At this point, Hang With effectively had zero monthly active users. In addition, the Company was not able to utilize Hang With’s technology in the Friendable app as was contemplated by the License Agreement due to Hang With’s technology being, in the Company’s view, out of date. The Company is currently seeking to negotiate a settlement with Hang With regarding the Company’s claims against Hang With.

As of December 31, 2016 Hang With had not delivered any of the preferred or common shares to the Company. During the year ended December 31, 2016, the Company had paid Hang With $575,000 which has been written off as a loss on investment. During the year ended December 31, 2017, the Company had paid Hang With $175,000 in connection to the fourth Closing which has been written off as a loss on investment.

14

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

The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the consolidated financial statements and related notes thereto included in Item 1 “Financial Statements” in this Quarterly Report on Form 10-Q. This discussion contains forward-looking statements that involve risks and uncertainties. The Company’s actual results could differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in the section titled “Risk Factors” included elsewhere in this Quarterly Report on Form 10-Q.

Overview

We were incorporated in the State of Nevada on June 5, 2007. Effective June 15, 2011, we completed a merger with our subsidiary, Titan Iron Ore Corp., a Nevada corporation, which was incorporated solely to effect a change in our name to “Titan Iron Ore Corp.”

As of December 31, 2013, Titan Iron Ore Corp. was a mineral exploration company. Due to our inability to raise capital to further develop mining claims and pursue mineral exploration, we decided to exit the mining business and look for other opportunities.

On February 3, 2014, we completed a merger with iHookup Social, Inc., a Delaware corporation (“iHookup”) pursuant to an Agreement and Plan of Merger and Reorganization (the “Merger Agreement”) dated January 31, 2014. Pursuant to the Merger Agreement, we incorporated a new subsidiary called iHookup Operations Corp, a Delaware corporation, which merged with and into iHookup, causing the subsidiary’s separate existence to cease and iHookup to become a wholly-owned subsidiary of the Company. iHookup’s stockholders exchanged all of their twelve million (12,000,000) shares of outstanding common stock for fifty million (50,000,000) shares of the Company’s newly designated Series A Preferred Stock. Each share of common stock entitles its holder to one vote on each matter submitted to the stockholders. The holders of preferred stock are entitled to cast votes equal to the number of votes equal to the number of whole shares of common stock into which the shares of Series A Preferred Stock held by such holder are convertible. The total aggregate issued shares of Series A Preferred Stock at any given time regardless of their number shall be convertible into the number of shares of common stock which equals nine (9) times the total number of shares of common stock which are issued and outstanding at the time of any conversion, at the option of the preferred holders or until the closing of a Qualified Financing (i.e. the sale and issuance of our equity securities that results in gross proceeds in excess of $2,500,000) at one time or in the same round. As a result of the transaction, the former Friendable stockholders received a controlling interest in the Company due to the voting rights of the Series A Preferred Stock being connected to their super-majority conversion rights.

On May 31, 2017, the Company filed an Amendment to its Articles of Incorporation increasing the authorized common stock from 10,000,000,000 to 15,000,000,000 shares. On June 28, 2017, the Company incorporated a subsidiary, Fan Pass Inc., a Nevada corporation, which was incorporated to hold all of the assets of the mobile application or The “Fan Pass” App.

Who We Are

The Company is a mobile-social technology company focused on connecting and engaging users through its existing social networking app “Friendable” and a new application scheduled to roll out in 2018, Fan Pass.

The Company’s first product was launched under the same name as the Company, the Friendable app. The app provides a mobile social network for both iOS and Android mobile devices/operating systems and allows users to create one-on-one or group-style meet-ups for food, drinks, live music venues, or any other occasion, based on location. Since its inception in 2013, Friendable has generated more than 1 million downloads, 800,000 registered users, and approximately 600,000 user profiles, and has been featured in popular music videos such as the 2016 hit “Ain’t Your Mama” by singer Jennifer Lopez. The Company seeks to explore new opportunities for growth, partnerships, mergers or acquisitions in 2018.

In 2018, the Company intends to release a beta version of its Fan Pass mobile application for user testing as well as complete a version of Fan Pass ready for commercial release. Additionally, Fan Pass is its own Corporation that is currently wholly owned by Friendable, Inc., and on a path to be spun off as a separate entity. The spin-off of Fan Pass, Inc. is intended to result in a share issuance to all Friendable shareholders as the Company files an S1 registration statement to become a stand-alone public company.

The Fan Pass app has been designed to capture and monetize content via live streaming video. Video content will be the focus in which the Company will build content related assets and allow brands/social media influencers to unite. The app has the opportunity to provide fans to capture and/or view exclusive back-stage and uncensored video content from their favorite performing artists and celebrities (social media influencers). Fan Pass is currently working on its application, as well as establishing partnerships with some of the very same and prominent artists utilized by Friendable in the past. These artists include Jennifer Lopez, Austin Mahone, Meghan Trainor, Fetty Wap, and more. Through these previous celebrity partnerships, Fan Pass believes it can drive downloads and convert downloads to users, this approach allows Fan Pass to leverage built-in fan bases into the application’s initial viewership base, making quick and large scalability a real possibility.

15

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

Mobile Applications Introduction The Friendable Mobile Application:   Friendable is a "friends-first" approach to making new connections. Unlike platforms like Facebook and Instagram where users post what they did in the past, Friendable’s features are designed and focused on living in the present and looking forward to the future:

■

Friendable is a mobile application where users can create meet-up events that can be shared to one person or multiple individuals.

■

Users can select which type of event they would like to create or attend, separated by categories like “Food,” “Movies,” and more.

■

Users with similar interests and locations will be matched together, and will then be able to chat with one another to coordinate a meet-up time and place.

■

Users can look up current events and send gifts to other users.

■

Users can friend other users to meet-up again, creating a social network of goers and adventurers.

As of April 2018, Friendable has been downloaded over 1 million times across iOS and Android.

“EverythingStarts with Friendship.”

Management believes that its Friendable app and brand, along with its existing feature set is in need of upgrades, expansion and more intelligent technology integration to stay competitive in the Social Networking category. With such upgrades being extremely costly and the existing user base growing only through search and organic word of mouth, Friendable intends to seek strategic partners that may provide new opportunities to create value for the Company’s shareholders by pivoting the app or its business focus in a new direction.

16

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

The Fan Pass Live Application(Development Project Fan Pass will be an online, mobile-based, video application that the Company believes will empower the end user by attracting brands, social influencers, artists, musicians and celebrities to build a significant content base and then deliver live, exclusive video content to their fan bases/app users. The app is to be available on both iOS and Android operating systems. Examples of content may include:

17

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

■ Branded Backstage access before, during or after an event ■ Recording studio sessions ■ Behind-the-scenes looks on music video, film, or photoshoot sets ■ On-set makeup or wardrobe trailers ■ Special interviews or one-on-one video sessions with celebrities ■ Daily looks into the lives of celebrities, artists, and stars ■ …and more VIP exclusive content In addition, fans will be able to chat with other fans before, during, and after the live stream; view older, archived live videos; and subscribe to an individual broadcast instead of a channel. We believe that, especially for a large event like a music festival or concert, the option for fans to briefly purchase a broadcast or view an older broadcast increases the likelihood of added subscriptions. For artists, Fan Pass will offer several levels of revenue-sharing with them and their agencies. Each artist will be asked to market their Fan Pass channel to their social followers and fans, ultimately generating subscription revenue for the Company. The revenue-sharing ecosystem is designed to help celebrities monetize their fans and followers at fairer rates compared to other video streaming applications; Fan Pass will be able to be used in conjunction with other video applications to bolster their income. Lastly, Fan Pass will offer video production and recording services for artists if they do not want to record their own streams.

“Empowering users, influencers and artists everywhere to deliver live, exclusive video content.”

Marketing

We intend to market our applications utilizing a variety of online and offline marketing activities, brand partnerships and social influencers that can spread the word far and wide.

The Company believes various marketing initiatives will combine celebrity driven outreach to social media followers and fans, specialized content, digital marketing, and live event marketing to optimize market reach.

Celebrity Marketing: Celebrity partners intend to utilize social media, music videos, live events and existing fan marketing to market Fan Pass Live and Friendable app.

Event Marketing: Marketing / business development teams will market the application at live events around music video releases, concerts, private events, promotional events, and other festivities. In addition, video and photography crews will take pictures and videos at events for public relations and social media.

Digital Marketing: The Company intends to utilize digital marketing avenues such as: celebrity direct-to-fan; digital ad campaigns on social media and search engines; search engine optimization; and other digital marketing initiatives that will utilize celebrity and user generated content for maximum market reach.

The Company also intends to utilize online marketing channels such as Google and social media marketing, display advertising, and online publications. The Company will continually track cost of user acquisition, the lifetime value of each customer, and ROI of all marketing expenditures to reduce expenses and increase overall profit margins.

The creation of a business development team that will curate the Company’s internal and external growth goals, and traditional forms of advertising such as television and radio are also key avenues. The goal of using these channels is to create a platform for the long-term success and brand awareness, a matrix of the Company’s planned marketing channels is listed below:

18

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

Marketing Initiatives

Revenue

The Friendable application is still pre-revenue based on its model to generates revenue through advertisements on the application, including sponsorships. Revenue in these areas can only be achieved through reaching a critical mass of users with daily, weekly and monthly active users that may be positioned for monetization.

The Company believes the Fan Pass application will generate revenue utilizing various avenues of pursuit:

■

brand sponsorship and/or monthly branded campaigns

■

social media influencers and promotion

■

content creation and development

■

advertising revenue from both live and archived videos

■

a monthly fee for special event channels

■

annual subscription fee for exclusive entitlements

■

a one-time fee for an individual broadcast

■

branded sales of merchandise, including t-shirts, hats, and more

Market Opportunity

Market Overview: Fan Pass

As the need for video streaming grows, so too, the Company believes, does the market opportunity for platforms like Fan Pass. Fan Pass will be a video streaming application that offers exclusive behind-the-scenes video access to celebrities. Consumers will pay a subscription fee to see videos of their favorite musicians at concerts, get a glimpse of their daily lives, or even interact with them. Viewings will include a look inside celebrity tour busses, rooms, private jets, and recording studio sessions, as well exclusive first interviews and back stage entry. Fan Pass aims to increase its market share and build viewership by allowing celebrities to monetize their respective fan-bases through exclusive video features

In 2018, the Company intends to identify a merger candidate for Friendable, Inc., the ideal candidate would be in the technology sector, having a solid management team, business model and ultimately an “X” Factor opportunity for explosive growth in an underserved or emerging market. Additionally, the Company intends to complete the spin off “Fan Pass, Inc.”, file an S1 registration statement and become a stand-alone public company under the Fan Pass brand. Friendable, Inc. management also intends to resume their respective positions (those currently held at Friendable) as well as taking on these very same responsibilities for Fan Pass, Inc. Part of completing the Fan Pass, Inc. spin out and S1 registration statement will be a distribution of Fan Pass, Inc. shares to all Friendable, Inc. (FDBL) shareholders of record (record date TBD).

19

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

Having a strategy that provides a new and exciting business opportunity for Friendable, Inc. will provide the opportunity for a WIN WIN on both sides for our shareholders and will allow Fan Pass, Inc. to pursue the release of the Fan Pass mobile app. The app is designed as a live streaming video application whereby fans can view exclusive back-stage and uncensored video content from their favorite performing artists and/or celebrity, live or on an archived basis. The Company is developing the mobile application and seeking to leverage partnerships with prominent artists, which Friendable has established previous relationships with in 2017. Through these celebrity partnerships, the Company believes Fan Pass will convert the built-in fan bases of these artists into the application’s initial viewership base, making quick and large scalability a real option.

Results of Operations

	Three Months Ended March 31, 2018 $	Three Months Ended March 31, 2017 $
REVENUES	3,081	3,043
OPERATING EXPENSES
Accretion and interest expense	867,561	646,264
App hosting	139,455	135,000
Commissions	884	913
General and administrative	217,938	231,801
Product development	-	50,400
Sales and marketing	490	99,494
TOTAL OPERATING EXPENSES	1,226,328	1,163,872
LOSS FROM OPERATIONS	(1,223,247)	(1,160,829)
OTHER EXPENSES
Loss on investment (Note 11)	-	(175,000)
NET LOSS AND COMPREHENSIVE LOSS	(1,223,247)	(1,335,829)

For the three months ended March 31, 2018 compared to March 31, 2017

Operating Expenses

The Company had operating expenses of $1,226,328 and $1,163,872 during the three months ended March 31, 2018 and 2017, respectively, an increase of 5%. The increase in operating expenses was due primarily to increased accretion and interest expense on convertible notes, offset by lower general and administrative, product development, and sales and marketing expenses.

Net Loss

The Company had a net loss for the three months ended March 31, 2018 of $1,223,247 as compared to a net loss of $1,335,829 for the three months ended March 31, 2017, a decrease of 8%. The decrease in net loss was due primarily to a loss on investment of $187,000 in 2017.

Liquidity and Capital Resources

Working Capital

	March 31, 2018	December 31, 2017
	(unaudited)	(audited)
Current Assets	$122,312	$6,863
Current Liabilities	8,598,417	7,526,021
Working Capital (Deficiency)	$(8,476,105)	$(7,519,158)

20

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

Current assets for the quarter ended March 31, 2018 increased compared to December 31, 2017 primarily due to more cash on hand.

Current liabilities for the quarter ended March 31, 2018 increased compared to December 31, 2016 primarily due to additional convertible debentures and increased accounts payable.

Cash Flows

	Three months	Three months
	Ended	Ended
	March 31, 2018	March 31, 2017
Net Cash Used in Operating Activities	$(92,286)	$(568,329)
Net Cash Used in Investing Activities	-	(175,000)
Net Cash Provided by Financing Activities	207,000	628,060
Net Increase (Decrease) in Cash	$114,714	(115,269)

Net Cash Used in Operating Activities

Our cash used in operating activities was $92,286 for the three month period ended March 31, 2018 compared to $568,329 for the three month period ended March 31, 2017. The cash used in operating activities was higher in 2017 due to higher general and administrative, product development, and sales and marketing expenses.

Net Cash Used in Investing Activities

Net cash used cash in investing activities for the three month period ended March 31, 2017 consisted of an investment in Hang With of $175,000.

Net Cash Provided by Financing Activities

Our cash provided by financing activities of $207,000 for the three month period ended March 31, 2018 and $628,060 for the three month period ended March 31, 2017 consisted of the issuance of convertible debentures.

The Company derives the majority of its financing by issuing convertible notes to investors. The investors have the right to convert the notes into common shares of the Company after the requisite Rule 144 waiting period. The notes generally call for the shares to be issued at a deep discount to the market price at the time of conversion.

Securities Purchase Agreement, Convertible Note, and Pledge Agreement with Alpha Capital Anstalt

On July 21, 2017, the Company entered into a Securities Purchase Agreement (the “Alpha SPA”) with Alpha Capital Anstalt (“Alpha Capital”), to issue and sell up to, in principal amount, $500,000 of convertible notes, payable in two tranches (the “Alpha Notes”). The first tranche of $300,000 was funded on July 21, 2017 (the “Initial Closing Date”). The second tranche of $200,000 will be upon effectiveness of the registration statement of Fan Pass Inc. and trading of common stock which is not later than 9 months after first closing. The Alpha Notes are senior to all current and future indebtedness of the Company except as agreed to by the parties. The conversion price of the notes will be the lowest conversion price of any instrument issued by the Company. The Alpha Notes are long-term debt obligations that are material to the Company. The Alpha Notes also contain certain representations, warranties, covenants and events of default. In the event of default, at the option of Alpha Capital and in their sole discretion, Alpha Capital may consider the Alpha Note’s immediately due and payable. Through various amendments to the Alpha SPA, Alpha Capital has funded the Company a total of $717,000 as of May 15, 2018.

In connection with the Alpha Notes and Alpha SPA, the Company also entered into a Pledge Agreement whereby as collateral security, the Company pledged shares of common stock of its subsidiary, Fan Pass, Inc. The number of shares pledged will be determined at a later date. The Company also has pledged collateral to Alpha Capital in the form of the Fan Pass Security Agreement which grants a security interest in and to, a lien upon and a right of set-off against all of their respective right, title and interest to the assets of Fan Pass Inc, including all intellectual property. The Alpha Notes have a beneficial ownership limitation such that Alpha Capital can never own more than 4.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon conversion of the Alpha Notes.

21

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

For its services as a placement agent for this transaction, Palladium Capital Advisors, LLC (“Palladium”) shall receive compensation of 8% of the aggregate purchase price paid in each Closing, the amount being $24,000 for the first closing. The Company has agreed to pay legal costs of $50,000 payable upon the First Closing, and an additional $50,000 upon the funding of the second tranche of $200,000, and $40,000 within thirty (30) days that Fan Pass, Inc. has a class of common stock registered pursuant to Section 12(g) of the Exchange Act.

Going Concern

As of March 31, 2018, the Company has a working capital deficiency of $8,476,105 and has an accumulated deficit of $20,361,716 since inception and its operations continue to be funded primarily from sales of its stock and issuance of convertible debentures. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to obtain the necessary financing through the issuance of convertible notes and equity financings. The consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

We have generated minimal revenues and have incurred losses since inception. Accordingly, we will be dependent on future additional financing in order to finance operations and growth. There is no assurance that we will generate sufficient revenue to sustain our operations.

Off-Balance Sheet Arrangements

As of March 31, 2018, the Company had no off-balance sheet arrangements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

This Item 3 is not applicable to us as a smaller reporting company and has been omitted.

ITEM 4. CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

We maintain “disclosure controls and procedures”, as that term is defined in Rule 13a-15(e), promulgated by the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our company’s reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

As required by paragraph (b) of Rules 13a-15 under the Securities Exchange Act of 1934, our management, with the participation of our principal executive officer and our principal financial officer, evaluated our company’s disclosure controls and procedures as of the end of the period covered by this quarterly report on Form 10-Q. Based on this evaluation, our management concluded that as of the end of the period covered by this quarterly report on Form 10-Q, our disclosure controls and procedures were not effective.

Management’s Report on Internal Control over Financial Reporting

Our management, including our principal executive officer, principal financial officer and our Board of Directors, is responsible for establishing and maintaining a process 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.

Our management, with the participation of our principal executive officer and our principal financial officer, evaluated the effectiveness of our internal control over financial reporting as of March 31, 2018. Our management’s evaluation of our internal control over financial reporting was based on the framework in Internal Control—Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our management concluded that our internal control over financial reporting was not effective as of March 31, 2018 due to the following material weaknesses which are indicative of many small companies with small staff: (i) inadequate segregation of duties and ineffective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines. To remediate such weaknesses, we believe we would need to implement the following changes: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out in (i) and (ii) are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may not be undertaken. Until we have the required funds, we do not anticipate implementing these remediation steps.

22

ITEM 4. CONTROLS AND PROCEDURES. - continued

 

A material weakness is a deficiency or a combination of control deficiencies in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

Our principal executive officer and our principal financial officer do not expect that our disclosure controls or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additional controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the fiscal quarter ended March 31, 2018 that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our Company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

ITEM 1A. RISK FACTORS. – GENERALLY THE COMPANY IS AT RISK IF THE PROPER FUNDING IS NOT COMMITED AND/OR SECURED TO FUND THE CONTINUED NEEDS OF THE COMPANY FOR OPERATIONS, DEVELOPMENT, PARTNER RELATIONSHIPS, SERVICE PROVIDERS and PUBLIC COMPANY RELATED EXPENSES.

We believe there are no changes that constitute material changes from the risk factors previously disclosed in our Annual Report on Form 10-K, filed with the SEC on April 17, 2018.

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

During the three months ended March 31, 2018, the Company issued 543,000,000 shares of common stock to various convertible note holders for full and partial conversion of convertible notes.

The issuance of the above securities was exempt from registration pursuant to Section 4(a)(2) of the Securities Act and Regulation D promulgated thereunder.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

There has been no default in the payment of principal, interest, sinking or purchase fund installment, or any other material default, with respect to any indebtedness of the Company.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

There is no other information required to be disclosed under this item which was not previously disclosed.

23

ITEM 6. EXHIBITS

The exhibits listed on the Exhibit Index immediately preceding such exhibits, which is incorporated herein by reference, are filed or furnished as part of this Quarterly Report on Form 10-Q.

Exhibit Number Description

(4)	Instruments defining the rights of security holders, including indentures
4.1	Convertible Note by and between the Company and Alpha Capital Anstalt dated July 21, 2017 (Incorporated by reference to the Current Report on form 8K, previously filed with the SEC on August 2, 2017)
(10)	Material Contracts
10.1	Securities Purchase Agreement by and between the Company and Alpha Capital Anstalt dated July 21, 2017 (Incorporated by reference to the Current Report on form 8K, previously filed with the SEC on August 2, 2017)
10.2	Fan Pass Security Agreement by and between the Company and Alpha Capital Anstalt dated July 21, 2017 (Incorporated by reference to the Current Report on form 8K, previously filed with the SEC on August 2, 2017)
10.3	Pledge Agreement by and between the Company and Alpha Capital Anstalt dated July 21, 2017 (Incorporated by reference to the Current Report on form 8K, previously filed with the SEC on August 2, 2017)
(31)	Rule 13a-14(a)/15d-14(a) Certification
31.1*	Certification of the Principal Executive Officer of the Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of the Principal Financial Officer of the Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
(32)	Section 1350 Certification
32.1+	Certification of the Principal Executive Officer and Principal Financial Officer of the Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(101)	XBRL
101.INS*	XBRL INSTANCE DOCUMENT
101.SCH*	XBRL TAXONOMY EXTENSION SCHEMA
101.CAL*	XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
101.DEF*	XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
101.LAB*	XBRL TAXONOMY EXTENSION LABEL LINKBASE
101.PRE*	XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE

* Filed herewith.

+ In accordance with SEC Release 33-8238, Exhibits 32.1 is being furnished and not filed.

24

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	FRIENDABLE, INC.
Date: May 21, 2018	By:	/s/ Robert Rositano, Jr.
		Name: Robert Rositano, Jr.
		Title: CEO, Secretary, and Director (Principal Executive Officer)
Date: May 21, 2018	By:	/s/ Frank Garcia
		Name: Frank Garcia
		Title: Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

25

EX-31.1

EXHIBIT 31.1

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Robert Rositano, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Friendable, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

A. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

B. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

C. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

D. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

A. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

B. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 21, 2018

/s/Robert Rositano                                                          

Robert Rositano

CEO, Secretary, and Director

(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Frank Garcia, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Friendable, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

A. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

B. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

C. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

D. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

A. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

B. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 21, 2018

/s/Frank Garcia                                                  

Frank Garcia

Chief Financial Officer

(Principal Accounting Officer and Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to 18 U.S.C. Section 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officers of Friendable, Inc. (the “Issuer”) hereby certify that:

(1) the quarterly report on Form 10-Q of the Issuer for the period ended March 31, 2018 fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(2) the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Issuer.

Date: May 21, 2018

/s/Robert Rositano                                                  

Robert Rositano

CEO, Secretary, and Director

 (Principal Executive Officer)

/s/Frank Garcia                                                       

Frank Garcia

Chief Financial Officer

(Principal Financial Officer and Principal Accounting Officer)

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2018	May 15, 2018
Document And Entity Information
Entity Registrant Name	Friendable, Inc.
Entity Central Index Key	0001414043
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		5,553,310,369
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2018

XML

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Current Assets
Cash	$ 114,714	$ 0
Accounts receivable	735	0
Prepaid expenses	6,863	6,863
Total current assets	122,312	6,863
Intangible assets (Note 3)	35,000	35,000
TOTAL ASSETS	157,312	41,863
Current Liabilities
Accounts payable	3,094,196	2,718,832
Convertible debentures (Note 10)	5,504,221	4,807,189
Deferred revenue	0	0
Total current liabilities	8,598,417	7,526,021
Total liabilities	8,598,417	7,526,021
STOCKHOLDERS' DEFICIT
Preferred stock, 50,000,000 shares authorized at par value of $0.0001, 21,267 (December 31, 2017 – 21,267 ) shares issued and outstanding (Note 4)	2	2
Common stock, 10,000,000,000 shares authorized at par value of $0.0001, 5,553,310,369 (December 31, 2017 – 5,010,310,369) shares issued and outstanding (Note 4)	555,331	501,031
Additional paid-in capital	11,369,778	11,157,778
Common stock subscriptions receivable (Note 8)	(4,500)	(4,500)
Deficit	(20,361,716)	(19,138,469)
Total Stockholders' Deficit	(8,441,105)	(7,484,158)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 157,312	$ 41,863

XML

CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2018	Dec. 31, 2017
STOCKHOLDERS' DEFICIT
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, authorized	50,000,000	50,000,000
Preferred stock, issued	21,267	21,267
Preferred stock, outstanding	21,267	21,267
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, authorized	15,000,000,000	15,000,000,000
Common stock, issued	5,553,310,369	5,010,310,369
Common stock, outstanding	5,553,310,369	5,010,310,369

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Income Statement [Abstract]
REVENUES	$ 3,081	$ 3,043
OPERATING EXPENSES
Accretion and interest expense (Note 10)	867,561	646,264
App hosting (Note 8)	139,455	135,000
Commissions	884	913
General and administrative (Note 8)	217,938	231,801
Product development (Note 8)	0	50,400
Sales and marketing	490	99,494
TOTAL OPERATING EXPENSES	1,226,328	1,163,872
LOSS FROM OPERATIONS	(1,223,247)	(1,160,829)
OTHER EXPENSES
Loss on investment (Note 11)	0	(175,000)
NET LOSS AND COMPREHENSIVE LOSS	$ (1,223,247)	$ (1,335,829)
BASIC LOSS PER SHARE	$ (0.00)	$ (0.00)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING	5,317,254,813	1,298,101,187

XML

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT - USD ($)	Common Stock	Preferred Stock	Additional Paid-in Capital	Common Stock Subcription	Deficit	Total
Begining balance, shares at Dec. 31, 2016	1,068,031,823	21,655
Begining balance, amount at Dec. 31, 2016	$ 106,803	$ 2	$ 9,609,198	$ (4,500)	$ (13,500,287)	$ (3,788,784)
Shares issued for services shares	123,220,000
Shares issued for services amount	$ 12,322		56,368			68,690
Conversion of convertible notes (Note 10), shares	3,521,332,373
Conversion of convertible notes (Note 10), amount	$ 352,133		410,819			762,952
Conversion of preferred shares (Note 4), shares	297,726,173	(388)
Conversion of preferred shares (Note 4), amount	$ 29,773		(29,773)
Issuance of convertible notes (net (Note 10)			1,111,166			1,111,166
Net loss for the period					(5,638,182)	(5,638,182)
Ending balance, shares at Dec. 31, 2017	5,010,310,369	21,267
Ending balance, amount at Dec. 31, 2017	$ 501,031	$ 2	11,157,778	(4,500)	(19,138,469)	(7,484,158)
Conversion of convertible notes (Note 10), shares	543,000,000
Conversion of convertible notes (Note 10), amount	$ 54,300		6,000			60,300
Issuance of convertible notes (net (Note 10)			206,000			206,000
Net loss for the period					(1,223,247)	(1,223,247)
Ending balance, shares at Mar. 31, 2018	5,553,310,369	21,267
Ending balance, amount at Mar. 31, 2018	$ 555,331	$ 2	$ 11,369,778	$ (4,500)	$ (20,361,716)	$ (8,441,105)

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash Flows from Operating Activities:
Net loss	$ (1,223,247)	$ (1,335,829)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Interest on convertible debentures	158,898	110,158
Accretion expense	708,663	536,106
Shares issued for services	0	9,440
Loss on investment	0	175,000
Changes in Operating Assets and Liabilities
Increase in accounts receivable	(735)	(796)
Increase (decrease) in accounts payable	264,135	(62,408)
Net Cash Used in Operating Activities	(92,286)	(568,329)
Cash Flows from Investing Activities:
Purchase of investment in Hang With	0	(175,000)
Net Cash Used in Investing Activities	0	(175,000)
Cash Flows Probided by Financing Activities:
Proceeds from convertible debentures (net)	207,000	628,060
Net Cash Provided by Financing Activities	207,000	628,060
Net Increase (Decrease) in Cash	114,714	(115,269)
Cash on Hand - Beginning	0	119,804
Cash on Hand - Ending	114,714	4,535
Supplemental Cash Flow Information:
Cash paid for interest	0	0
Cash paid for income taxes	0	0
Non-cash Investing and Financing Items:
Shares issued for conversion of debt (net)	0	0
Convertible debentures issued to extinguish promissory notes	0	0
Cash consists of:
Cash	$ 114,714	$ 119,804

XML

1. NATURE OF BUSINESS AND GOING CONCERN

3 Months Ended

Mar. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NATURE OF BUSINESS AND GOING CONCERN

Friendable, Inc., a Nevada corporation (the “Company”), was incorporated in the State of Nevada as Digital Yearbook Inc.

Effective June 15, 2011, the Company completed a merger with its subsidiary, Titan Iron Ore Corp., a Nevada corporation, which was incorporated solely to effect a change in the Company’s name from “Digital Yearbook Inc.” to “Titan Iron Ore Corp.” The Company then began to pursue business in the area of mining exploration.

On February 3, 2014, the Company entered into an Agreement and Plan of Merger and Reorganization (the “Merger”) with iHookup Operations Corp., a wholly-owned Delaware subsidiary of the Company (“Acquisition Sub”) and iHookup-DE, whereby iHookup-DE was the surviving entity and became the wholly-owned subsidiary of the Company. iHookup-DE’s former stockholders exchanged all of their 6,000 shares of outstanding common stock for 25,000 shares of the Company’s designated Series A Preferred Stock.

The Merger was regarded as a reverse recapitalization whereby iHookup-DE was considered to be the accounting acquirer as its stockholders retained control of the Company after the Merger. On February 3, 2014, the Merger was completed and as a result, iHookup-DE acquired the net liabilities of the Company.

As a result of the Merger, the Company ceased its prior operations and its business became the development and dissemination of a “proximity based” mobile-social media application that facilitates connections between people, utilizing the intelligence of global positioning system and localized recommendations.

On September 28, 2015, the Company filed a Certificate of Amendment to its Articles of Incorporation changing the name of the Company from “iHookup Social, Inc.” to “Friendable, Inc.”. On October 27, 2015, the Company’s trading symbol on the OTC Pink marketplace was changed from “HKUP” to “FDBL”. This change was made in conjunction with the re-branding of the Company’s app from "iHookup Social" to "Friendable".

On June 28, 2017, the Company formed a wholly owned Nevada subsidiary called Fan Pass Inc.

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern, which implies that the Company would continue to realize its assets and discharge its liabilities in the normal course of business. The Company has never paid any dividends and is unlikely to pay dividends or generate earnings in the immediate or foreseeable future. As of March 31, 2018, the Company has a working capital deficiency of $8,476,105 and has an accumulated deficit of $20,361,716 since inception and its operations continue to be funded primarily from sales of its stock and issuance of convertible debentures. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to obtain the necessary financing through the issuance of convertible notes and equity instruments. The consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Management plans to raise financing through the issuance of convertible notes. No assurance can be given that any such additional financing will be available, or that it can be obtained on terms acceptable to the Company and its stockholders.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Mar. 31, 2018

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. The Company’s fiscal year end is December 31.

Use of Estimates

The preparation of these statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions related to the useful life and recoverability of long-lived assets, valuation of convertible debenture conversion options, deferred income tax asset valuations, financial instrument valuations, share-based payments, other equity-based payments, and loss contingencies. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. 

Revenue Recognition

Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. The Company derives revenues from the sale of application software, unlimited messaging subscriptions for periods varying from one to twelve months, and arrangements for virtual gifts and access to special features referred to as coin packs. Revenue from the sale of application software is recognized upon download. Revenue from messaging subscriptions is recognized as revenue ratably over the subscription period beginning on the date the service is made available to customers. Revenue from coin packs is recognized on a consumption basis commensurate with the customer utilization of such resources.

Advertising Costs

The Company’s policy regarding advertising is to expense advertising when incurred. During the quarter ended March 31, 2018, the Company incurred $299 (March 31, 2017: $1,397) in advertising costs.

Cash and Cash Equivalents

The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents.

Intangible Assets

The Company accounts for intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other. The Company assesses potential impairments to intangible assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered.

Intangible assets with finite lives are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of intangible assets with finite lives is measured by comparing the carrying amount of the asset to its fair value. If the future value of the asset is lower than its carrying value, the Company recognizes an impairment loss for the amount by which the carrying value of the asset exceeds the related estimated fair value.

Intangible assets with indefinite lives are tested for impairment annually or more frequently are tested for impairment annually or more frequently if events or changes in circumstances indicate that it is more likely than not that the intangible asset is impaired.

Impairment of Long-Lived Assets

The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows.

If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell.

Stock-based Compensation

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Based Compensation and ASC 505, Equity Based Payments to Non-Employees, which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based awards made to employees and directors, including stock options.

ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option pricing model as its method in determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Company’s expected stock price volatility over the terms of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of comprehensive loss over the requisite service period.

All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

Allowance for Doubtful Accounts

The Company monitors its outstanding receivables for timely payments and potential collection issues. During the quarter ended March 31, 2018 and 2017, the Company did not have any allowance for doubtful accounts.

Financial Instruments

Financial assets and financial liabilities are recognized in the balance sheet when the Company has become party to the contractual provisions of the instruments.

The Company’s financial instruments consist of accounts payable and convertible debentures. The fair values of these financial instruments approximate their carrying value, due to their short term nature, and current market rates for similar financial instruments. Fair value of a financial instrument is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company’s financial instruments recorded at fair value in the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value.

Basic and Diluted Loss Per Share

The Company computes net loss per share in accordance with ASC 260, Earnings per Share.  ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of comprehensive loss. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

As of March 31, 2018, there were approximately 60,719,913,802 potentially dilutive shares outstanding.

Income Taxes

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Income Taxes. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, “Revenue Recognition” and some cost guidance included in ASC Subtopic 605-35, Revenue Recognition -Construction-Type and Production-Type Contracts”.  ASU 2014-09 requires the disclosure of sufficient information to enable users of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. The Company will also be required to disclose information regarding significant judgments and changes in judgments, and assets recognized from costs incurred to obtain or fulfill a contract. Early adoption is not allowed. ASU 2014-09 provides two methods of retrospective application. The first method would require the Company to apply ASU 2014-09 to each prior reporting period presented. The second method would require the Company to retrospectively apply with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application. The Company is currently evaluating the impact that the adoption of ASU 2014-09 may have on its consolidated financial statements.

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3. INTANGIBLE ASSETS

3 Months Ended

Mar. 31, 2018

Intangible Assets

INTANGIBLE ASSETS

As at March 31, 2018, the Company owns the Friendable Properties which includes domain names, logos, icons, and registered trademarks for which it paid cash consideration of $35,000.

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4. COMMON AND PREFERRED STOCK

3 Months Ended

Mar. 31, 2018

Equity [Abstract]

COMMON AND PREFERRED STOCK

Common Stock:

Issued during 2018

During the quarter ended March 31, 2018, the Company issued 543,000,000 shares of common stock to various convertible note holders for full and partial conversion of the notes (Note 10).

Preferred Stock:

The Series A Preferred Stock is convertible into nine (9) times the number of common stock outstanding until the closing of a Qualified Financing (i.e. the sale and issuance of the Company’s equity securities that results in gross proceeds in excess of $2,500,000).  The number of shares of common stock issued on conversion of preferred stock is based on the ratio of the number of shares of preferred stock converted to the total number of shares of preferred stock outstanding at the date of conversion multiplied by nine (9) times the number of common stock outstanding at the date of conversion.

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5. SHARE PURCHASE WARRANTS

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

SHARE PURCHASE WARRANTS

Balance of share purchase warrants as of March 31, 2018 and year ended December 31, 2017 are:

			Weighted Average
			Exercise
	Number of Warrants		Price $
Balance, December 31, 2017		1,096,335,757		0.004
Balance, March 31, 2018		1,096,335,757		0.004

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6. STOCK-BASED COMPENSATION

3 Months Ended

Mar. 31, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

STOCK BASED COMPENSATION

On November 22, 2011, the Board of Directors of the Company (see Note 1) approved a stock option plan (“2011 Stock Option Plan”), the purpose of which is to enhance the Company’s stockholder value and financial performance by attracting, retaining and motivating the Company’s officers, directors, key employees, consultants and its affiliates and to encourage stock ownership by such individuals by providing them with a means to acquire a proprietary interest in the Company’s success through stock ownership. Under the 2011 Stock Option Plan, officers, directors, employees and consultants who provide services to the Company may be granted options to acquire common shares of the Company.   The aggregate number of options authorized by the plan shall not exceed 4,974 shares of common stock of the Company. 

The following table summarizes the options outstanding and exercisable under the 2011 Stock Option Plan as of March 31, 2018:

	Option Price
Expiry Date	Per Share($)		Number
December 21, 2021		1,680		1,725
June 21, 2022		400		500
June 25, 2023		134		850
	$	1,044		3,075

The Board of Directors and the stockholders holding a majority of the voting power approved a 2014 Equity Incentive Plan (the “2014 Plan”) on February 28, 2014, with a to be determined effective date. The purpose of the 2014 Plan is to assist the Company and its affiliates in attracting, retaining and providing incentives to employees, directors, consultants and independent contractors who serve the Company and its affiliates by offering them the opportunity to acquire or increase their proprietary interest in the Company and to promote the identification of their interests with those of the stockholders of the Company. The 2014 Plan will also be used to make grants to further reward and incentivize current employees and others.

There are 120,679 shares of common stock reserved for issuance under the 2014 Plan. The Board shall have the power and authority to make grants of stock options to employees, directors, consultants and independent contractors who serve the Company and its affiliates. Any stock options granted under the 2014 Plan shall have an exercise price equal to or greater than the fair market value of the Company’s shares of common stock. Unless otherwise determined by the Board of Directors, stock options shall vest over a four-year period with 25% being vested after the end of one (1) year of service and the remainder vesting equally over a 36-month period.  The Board may award options that may vest based upon the achievement of certain performance milestones. As of March 31, 2018, no options have been awarded under the 2014 Plan.

The following table summarizes the Company’s stock options outstanding and exercisable:

	Number of Options		Weighted Average Exercise Price		Weighted- Average Remaining Contractual Term (years) $		Aggregate Intrinsic Value $
Outstanding and exercisable, December 31, 2016		3,075		1,044		6.57		-
Outstanding and exercisable, December 31, 2017		3,075		1,044		5.57		-
Outstanding and exercisable, March 31, 2018		3,075		1,044		5.32		-

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7. COMMITMENTS

3 Months Ended

Mar. 31, 2018

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS

The following table summarizes the Company’s significant contractual obligations as of March 31, 2018:

	$
Employment Agreements (1)		225,000

 (1) Employment agreements with related parties.

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8. RELATED PARTY TRANSACTIONS AND BALANCES

3 Months Ended

Mar. 31, 2018

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS AND BALANCES

During the quarter ended March 31, 2018, the Company incurred $114,800 (2017: 132,300) in salaries to officers and directors with such costs being recorded as general and administrative expenses.

During the quarter ended March 31, 2018, the Company incurred $154,455 (2017: $200,000) in app hosting, app development and rent to a company with two officers and directors in common with such costs being recorded as app hosting, product development and general and administrative expenses.

As of March 31, 2018, the Company had a stock subscription receivable totaling $4,500 (December 31, 2017: $4,500) from an officer and director and from a company with an officer and director in common.

As of March 31, 2018, accounts payable includes $598,833 (December 31, 2017: $481,078) payable to a company with two officers and directors in common, and $566,211 (December 31, 2017: $474,583) payable in salaries to directors and officers of the Company. The amounts are unsecured, non-interest bearing and are due on demand.

The above transactions were recorded at their exchange amounts, being the amounts agreed by the related parties.

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9. FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2018

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

ASC 820, Fair Value Measurements and Disclosures, require an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Valuations are based on quoted prices that are readily and regularly available in an active market and do not entail a significant degree of judgment.

Level 2

Level 2 applies to assets or liabilities for which there are other than Level 1 observable inputs such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 2 instruments require more management judgment and subjectivity as compared to Level 1 instruments. For instance: determining which instruments are most similar to the instrument being priced requires management to identify a sample of similar securities based on the coupon rates, maturity, issuer, credit rating and instrument type, and subjectively select an individual security or multiple securities that are deemed most similar to the security being priced; and determining whether a market is considered active requires management judgment.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The determination of fair value for Level 3 instruments requires the most management judgment and subjectivity.

Pursuant to ASC 825, cash is based on Level 1 inputs. The Company believes that the recorded values of accounts receivable and accounts payable approximate their current fair values because of their nature or respective relatively short durations. The fair value of the Company’s convertible debentures approximates their carrying values as the underlying imputed interest rates approximates the estimated current market rate for similar instruments.

As of March 31, 2018, there were no assets or liabilities measured at fair value on a recurring basis presented on the Company’s balance sheet, other than cash. 

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10. CONVERTIBLE DEBENTURES

3 Months Ended

Mar. 31, 2018

Debt Disclosure [Abstract]

CONVERTIBLE DEBENTURES

Current Convertible Debentures:

Conversion Feature		Issuance	Net Principal ($)	Discount ($)	Carrying Value ($)	Interest Rate		Maturity Date
a	)	2-Apr-13	5,054	-	5,054	0	%	2-Jan-14
d	)	5-Aug-15	474,900	-	474,900	7	%	5-Feb-17
d	)	5-Aug-15	18,750	-	18,750	7	%	5-Feb-17
c	)	17-Feb-15	102,135	-	102,135	8	%	17-Feb-16
b	)	17-Feb-15	5,000	-	5,000	8	%	17-Feb-16
b	)	27-Feb-15	37,500	-	37,500	8	%	27-Feb-16
b	)	19-Mar-15	53,551	-	53,551	8	%	19-Mar-16
b	)	19-Mar-15	8,000	-	8,000	8	%	19-Mar-16
b	)	11-May-15	50,000	-	50,000	8	%	11-May-16
b	)	2-Jun-15	29,500	-	29,500	8	%	2-Jun-16
b	)	2-Jun-15	45,966	-	45,966	8	%	2-Jun-16
b	)	2-Jun-15	10,000	-	10,000	8	%	2-Jun-16
b	)	2-Jun-15	58,540	-	58,540	8	%	2-Jun-16
b	)	2-Jun-15	35,408	-	35,408	8	%	2-Jun-16
b	)	2-Jun-15	20,758	-	20,758	8	%	2-Jun-16
c	)	11-Jun-15	50,000	-	50,000	8	%	27-Mar-16
b	)	19-Jun-15	30,464	-	30,464	8	%	19-Jun-16
b	)	19-Jun-15	30,000	-	30,000	8	%	19-Jun-16
b	)	19-Jun-15	35,408	-	35,408	8	%	19-Jun-16
b	)	24-Jun-15	37,500	-	37,500	8	%	27-Feb-16
b	)	24-Jun-15	35,000	-	35,000	8	%	12-Feb-16
b	)	24-Jun-15	37,500	-	37,500	8	%	12-Mar-16
b	)	7-Jul-15	75,000	-	75,000	8	%	7-Oct-15
b	)	1-Aug-15	17,408	-	17,408	8	%	4-Aug-16
b	)	1-Aug-15	30,000	-	30,000	8	%	1-Aug-16
b	)	1-Aug-15	35,408	-	35,408	8	%	1-Aug-16
b	)	21-Sep-15	64,744	-	64,744	8	%	21-Sep-16
b	)	3-May-16	50,000	-	50,000	8	%	3-May-17
b	)	3-May-16	50,000	-	50,000	8	%	11-May-16
b	)	3-May-16	29,500	-	29,500	8	%	2-Jun-16
b	)	3-May-16	45,965	-	45,965	8	%	2-Jun-16
b	)	24-May-16	61,571	-	61,571	8	%	24-May-17
b	)	24-May-16	30,464	-	30,464	8	%	19-Jun-16
b	)	26-May-16	157,500	-	157,500	8	%	26-May-17
b	)	15-Jun-16	5,000	-	5,000	8	%	15-Jun-17
d	)	3-Jun-16	160,000	-	160,000	7	%	8-Sep-17
d	)	3-Jun-16	4,000	-	4,000	7	%	8-Sep-17
d	)	15-Jun-16	50,000	-	50,000	7	%	8-Sep-17
d	)	15-Jun-16	1,250	-	1,250	7	%	8-Sep-17
d	)	17-May-16	100,000	-	100,000	7	%	8-Sep-17
d	)	17-May-16	2,500	-	2,500	7	%	8-Sep-17
d	)	20-May-16	110,000	-	110,000	7	%	8-Sep-17
d	)	20-May-16	2,750	-	2,750	7	%	8-Sep-17
d	)	27-Jan-16	250,000	-	250,000	7	%	27-Jul-17
d	)	8-Mar-16	110,000	-	110,000	7	%	8-Sep-17
d	)	27-Jan-16	18,750	-	18,750	7	%	27-Jul-17
d	)	8-Mar-16	5,000	-	5,000	7	%	8-Sep-17
d	)	8-Mar-16	90,000	-	90,000	8	%	8-Sep-17

b	)	8-Jul-16	50,000	-	50,000	7	%	8-Sep-17
b	)	4-Aug-16	110,000	-	110,000	7	%	8-Sep-17
d	)	15-Aug-16	157,000	-	157,000	7	%	8-Sep-17
d	)	12-Sep-16	83,000	-	83,000	7	%	8-Sep-17
d	)	8-Jul-16	1,250	-	1,250	7	%	8-Sep-17
d	)	4-Aug-16	2,750	-	2,750	7	%	8-Sep-17
d	)	15-Aug-16	3,925	-	3,925	7	%	8-Sep-17
d	)	12-Sep-16	2,075	-	2,075	7	%	8-Sep-17
d	)	4-Aug-16	110,000	-	110,000	8	%	4-Aug-17
b	)	15-Aug-16	157,500	-	157,500	8	%	15-Aug-17
b	)	8-Sep-16	80,000	-	80,000	8	%	8-Sep-17
b	)	11-Nov-16	80,000	-	80,000	8	%	11-Nov-17
b	)	5-Dec-16	88,000	-	88,000	8	%	5-Dec-17
b	)	9-Jan-17	84,000	-	84,000	8	%	6-Jan-18
b	)	13-Mar-17	32,000	-	32,000	8	%	13-Mar-18
c	)	2-Feb-17	90,198	-	90,198	8	%	2-Feb-18
c	)	15-Mar-17	96,000	-	96,000	8	%	15-Mar-18
d	)	7-Oct-16	465,000	63,912	401,088	7	%	7-Apr-18
d	)	7-Nov-16	295,000	47,914	247,086	7	%	7-May-18
d	)	12-Dec-16	295,000	18,033	276,967	7	%	12-Jun-18
d	)	18-Jan-17	295,000	11,543	283,457	7	%	7-Apr-18
b	)	7-Apr-17	25,000	2,754	22,246	8	%	7-Apr-18
b	)	3-May-17	27,000	9,809	17,191	8	%	3-May-18
c	)	5-May-17	30,000	11,574	18,426	8	%	5-May-18
b	)	2-Jun-17	27,000	14,115	12,885	8	%	2-Jun-18
s) d	)	21-Jul-17	698,258	485,908	212,350	10	%	21-Jul-18
s) d	)	21-Jul-17	24,000	6,917	17,083	10	%	21-Jul-18
			6,176,700	672,479	5,504,221

a) The conversion price per share equal to the lower of:

i. 100% of the average price of the Company’s common stock for the 5 trading days preceding the conversion date;

ii. 70% of the daily average price of the Company’s common stock for the 10 trading days preceding the conversion date.

b) The conversion price is equal to 50% of the lowest closing bid price of the Company’s common stock for the 15-20 trading days preceding the conversion date subject to a maximum conversion price ranging from $0.0005-$0.05.

c) The conversion price equal to 50% of the lowest closing bid price of the Company’s common stock in the 20-25 trading days prior to the conversion.

d) The conversion price is fixed ranging from $0.0003 - $0.0078.

s) Convertible debenture is secured

During the quarter ended March 31, 2018, the Company received net proceeds from convertible debentures of $207,000 (2017: $628,060).

During the quarter ended March 31, 2018, $60,300 (2017: $240,484) of convertible debentures were settled by issuing 543,000,000 (2017: 435,823,830) shares of common stock of the Company.

During the quarter ended March 31, 2018, the Company incurred $255 (2017: $29,250) in transaction costs in connection with the issuance of the convertible debentures that have been offset against the carrying values of the related debentures on the issuance date.

During the quarter ended March 31, 2018, the Company incurred $867,561 (2017: $646,264) in accretion and interest expense in connection with the convertible debentures.

At March 31, 2018, convertible debentures with the principal amount of $6,176,700 are subject to a General Security Agreement covering substantially all of the Company’s assets.

The Company has evaluated whether separate financial instruments with the same terms as the conversion features above would meet the characteristics of a derivative instrument as described in paragraphs ASC 815-15-25. The terms of the contracts do not permit net settlement, as the shares delivered upon conversion are not readily convertible to cash. The Company’s trading history indicated that the shares are thinly traded and the market would not absorb the sale of the shares issued upon conversion without significantly affecting the price. As the conversion features would not meet the characteristics of a derivative instrument as described in ASC 815-15-25, the conversion features are not required to be separated from the host instrument and accounted for separately. As a result, at March 31, 2018 the conversion features and non-standard anti-dilution provisions would not meet derivative classification.

Convertible debentures with maturity dates prior to March 31, 2018 are now due on demand.

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11. LOSS ON INVESTMENT AND INTANGIBLE ASSET

3 Months Ended

Mar. 31, 2018

Loss On Investment And Intangible Asset

LOSS ON INVESTMENT AND INTANGIBLE ASSET

On October 7, 2016, the Company entered into a Securities Purchase Agreement (the “Alpha SPA”) with Alpha Capital Anstalt (“Alpha Capital”), to issue and sell up to, in principal amount, $1,615,000 of convertible notes, payable in four tranches (the “Alpha Notes”). The first tranche of $465,000 was funded on October 7, 2016 (the “Initial Closing Date”) and the second, third, and fourth tranches of $375,000 were funded, respectively, during the first week of each of November 2016, December 2016, and January 2017 (the subsequent closing dates and, with the Initial Closing Date, each a “Closing”).

The Company used a portion of the proceeds of each Closing to purchase Series A Convertible Participating Preferred Stock of a private entity named Hang With, Inc. (“Hang With”). Alpha Capital is currently Hang With’s majority shareholder. On October 7, 2016, the Company entered into a Securities Purchase Agreement with Hang With (the “Hang With SPA”) to buy up to 330,397 shares of Hang With’s Series A Convertible Participating Preferred Stock (the “Preferred Stock”) for $750,000. On the Initial Closing Date, the Company paid $225,000 and was to receive 99,118 shares of Preferred Stock. The Company paid Hang With $175,000 on each of the subsequent three Closings. In connection with entering into the Hang With SPA, the Company and Hang With entered into a Software License Agreement (the “License Agreement”) in which Hang With is licensing the intellectual property of the Hang With apps to the Company. As part of the Hang With SPA and as compensation for the Company entering into the License Agreement and the future development agreement, Hang With was to issue 154,185 shares of Preferred Stock on the Initial Closing Date, and was to issue 100,000 shares of its common stock to the Company.

The Company attributed much of the value of Hang With to Hang With management’s representation that, in the history of its own apps, it had a certain amount of total users and a range of monthly active users. Hang With believed, prior to the Hang With SPA being signed, that, with the Company’s investment, the monthly active users would be at the higher end of the range within a short period of time. Based on these representations by management the Company believed that it could specifically market its own apps to the minimum monthly active users of the Hang With app that Hang With management’s represented existed.

The Company believes that, after the November 2016 Closing, the Hang With app was removed for a period of time from the app stores on which it appeared and that the app was shut down for a period of time. At this point, Hang With effectively had zero monthly active users. In addition, the Company was not able to utilize Hang With’s technology in the Friendable app as was contemplated by the License Agreement due to Hang With’s technology being, in the Company’s view, out of date. The Company is currently seeking to negotiate a settlement with Hang With regarding the Company’s claims against Hang With.

As of December 31, 2016 Hang With had not delivered any of the preferred or common shares to the Company. During the year ended December 31, 2016, the Company had paid Hang With $575,000 which has been written off as a loss on investment. During the year ended December 31, 2017, the Company had paid Hang With $175,000 in connection to the fourth Closing which has been written off as a loss on investment.

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

3 Months Ended

Mar. 31, 2018

Accounting Policies [Abstract]

Basis of Presentation

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. The Company’s fiscal year end is December 31.

Use of Estimates

The preparation of these statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions related to the useful life and recoverability of long-lived assets, valuation of convertible debenture conversion options, deferred income tax asset valuations, financial instrument valuations, share-based payments, other equity-based payments, and loss contingencies. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. 

Revenue Recognition

Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities. The Company derives revenues from the sale of application software, unlimited messaging subscriptions for periods varying from one to twelve months, and arrangements for virtual gifts and access to special features referred to as coin packs. Revenue from the sale of application software is recognized upon download. Revenue from messaging subscriptions is recognized as revenue ratably over the subscription period beginning on the date the service is made available to customers. Revenue from coin packs is recognized on a consumption basis commensurate with the customer utilization of such resources.

Advertising Costs

The Company’s policy regarding advertising is to expense advertising when incurred. During the quarter ended March 31, 2018, the Company incurred $299 (March 31, 2017: $1,397) in advertising costs.

Cash and Cash Equivalents

The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents.

Intangible Assets

The Company accounts for intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other. The Company assesses potential impairments to intangible assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered.

Intangible assets with finite lives are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of intangible assets with finite lives is measured by comparing the carrying amount of the asset to its fair value. If the future value of the asset is lower than its carrying value, the Company recognizes an impairment loss for the amount by which the carrying value of the asset exceeds the related estimated fair value.

Intangible assets with indefinite lives are tested for impairment annually or more frequently are tested for impairment annually or more frequently if events or changes in circumstances indicate that it is more likely than not that the intangible asset is impaired.

Impairment of Long-Lived Assets

The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows.

If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell.

Stock-based Compensation

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Based Compensation and ASC 505, Equity Based Payments to Non-Employees, which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based awards made to employees and directors, including stock options.

ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option pricing model as its method in determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Company’s expected stock price volatility over the terms of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of comprehensive loss over the requisite service period.

All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

Allowance for Doubtful Accounts

The Company monitors its outstanding receivables for timely payments and potential collection issues. During the quarter ended March 31, 2018 and 2017, the Company did not have any allowance for doubtful accounts.

Financial Instruments

Financial assets and financial liabilities are recognized in the balance sheet when the Company has become party to the contractual provisions of the instruments.

The Company’s financial instruments consist of accounts payable and convertible debentures. The fair values of these financial instruments approximate their carrying value, due to their short term nature, and current market rates for similar financial instruments. Fair value of a financial instrument is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company’s financial instruments recorded at fair value in the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value.

Basic and Diluted Loss Per Share

The Company computes net loss per share in accordance with ASC 260, Earnings per Share.  ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of comprehensive loss. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

As of March 31, 2018, there were approximately 60,719,913,802 potentially dilutive shares outstanding.

Income Taxes

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Income Taxes. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, “Revenue Recognition” and some cost guidance included in ASC Subtopic 605-35, Revenue Recognition -Construction-Type and Production-Type Contracts”.  ASU 2014-09 requires the disclosure of sufficient information to enable users of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. The Company will also be required to disclose information regarding significant judgments and changes in judgments, and assets recognized from costs incurred to obtain or fulfill a contract. Early adoption is not allowed. ASU 2014-09 provides two methods of retrospective application. The first method would require the Company to apply ASU 2014-09 to each prior reporting period presented. The second method would require the Company to retrospectively apply with the cumulative effect of initially applying ASU 2014-09 recognized at the date of initial application. The Company is currently evaluating the impact that the adoption of ASU 2014-09 may have on its consolidated financial statements.

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5. SHARE PURCHASE WARRANTS (Tables)

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Share Purchase Warrants

			Weighted Average
			Exercise
	Number of Warrants		Price $
Balance, December 31, 2017		1,096,335,757		0.004
Balance, March 31, 2018		1,096,335,757		0.004

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6. STOCK-BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Options outstanding

	Option Price
Expiry Date	Per Share($)		Number
December 21, 2021		1,680		1,725
June 21, 2022		400		500
June 25, 2023		134		850
	$	1,044		3,075

Stock option activity

	Number of Options		Weighted Average Exercise Price		Weighted- Average Remaining Contractual Term (years) $		Aggregate Intrinsic Value $
Outstanding and exercisable, December 31, 2016		3,075		1,044		6.57		-
Outstanding and exercisable, December 31, 2017		3,075		1,044		5.57		-
Outstanding and exercisable, March 31, 2018		3,075		1,044		5.32		-

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7. COMMITMENTS (Tables)

3 Months Ended

Mar. 31, 2018

Commitments Tables

Commitments

	$
Employment Agreements (1)		225,000

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10. CONVERTIBLE DEBENTURES (Tables)

3 Months Ended

Mar. 31, 2018

Debt Disclosure [Abstract]

Convertible Debt

Current Convertible Debentures:

Conversion Feature		Issuance	Net Principal ($)	Discount ($)	Carrying Value ($)	Interest Rate		Maturity Date
a	)	2-Apr-13	5,054	-	5,054	0	%	2-Jan-14
d	)	5-Aug-15	474,900	-	474,900	7	%	5-Feb-17
d	)	5-Aug-15	18,750	-	18,750	7	%	5-Feb-17
c	)	17-Feb-15	102,135	-	102,135	8	%	17-Feb-16
b	)	17-Feb-15	5,000	-	5,000	8	%	17-Feb-16
b	)	27-Feb-15	37,500	-	37,500	8	%	27-Feb-16
b	)	19-Mar-15	53,551	-	53,551	8	%	19-Mar-16
b	)	19-Mar-15	8,000	-	8,000	8	%	19-Mar-16
b	)	11-May-15	50,000	-	50,000	8	%	11-May-16
b	)	2-Jun-15	29,500	-	29,500	8	%	2-Jun-16
b	)	2-Jun-15	45,966	-	45,966	8	%	2-Jun-16
b	)	2-Jun-15	10,000	-	10,000	8	%	2-Jun-16
b	)	2-Jun-15	58,540	-	58,540	8	%	2-Jun-16
b	)	2-Jun-15	35,408	-	35,408	8	%	2-Jun-16
b	)	2-Jun-15	20,758	-	20,758	8	%	2-Jun-16
c	)	11-Jun-15	50,000	-	50,000	8	%	27-Mar-16
b	)	19-Jun-15	30,464	-	30,464	8	%	19-Jun-16
b	)	19-Jun-15	30,000	-	30,000	8	%	19-Jun-16
b	)	19-Jun-15	35,408	-	35,408	8	%	19-Jun-16
b	)	24-Jun-15	37,500	-	37,500	8	%	27-Feb-16
b	)	24-Jun-15	35,000	-	35,000	8	%	12-Feb-16
b	)	24-Jun-15	37,500	-	37,500	8	%	12-Mar-16
b	)	7-Jul-15	75,000	-	75,000	8	%	7-Oct-15
b	)	1-Aug-15	17,408	-	17,408	8	%	4-Aug-16
b	)	1-Aug-15	30,000	-	30,000	8	%	1-Aug-16
b	)	1-Aug-15	35,408	-	35,408	8	%	1-Aug-16
b	)	21-Sep-15	64,744	-	64,744	8	%	21-Sep-16
b	)	3-May-16	50,000	-	50,000	8	%	3-May-17
b	)	3-May-16	50,000	-	50,000	8	%	11-May-16
b	)	3-May-16	29,500	-	29,500	8	%	2-Jun-16
b	)	3-May-16	45,965	-	45,965	8	%	2-Jun-16
b	)	24-May-16	61,571	-	61,571	8	%	24-May-17
b	)	24-May-16	30,464	-	30,464	8	%	19-Jun-16
b	)	26-May-16	157,500	-	157,500	8	%	26-May-17
b	)	15-Jun-16	5,000	-	5,000	8	%	15-Jun-17
d	)	3-Jun-16	160,000	-	160,000	7	%	8-Sep-17
d	)	3-Jun-16	4,000	-	4,000	7	%	8-Sep-17
d	)	15-Jun-16	50,000	-	50,000	7	%	8-Sep-17
d	)	15-Jun-16	1,250	-	1,250	7	%	8-Sep-17
d	)	17-May-16	100,000	-	100,000	7	%	8-Sep-17
d	)	17-May-16	2,500	-	2,500	7	%	8-Sep-17
d	)	20-May-16	110,000	-	110,000	7	%	8-Sep-17
d	)	20-May-16	2,750	-	2,750	7	%	8-Sep-17
d	)	27-Jan-16	250,000	-	250,000	7	%	27-Jul-17
d	)	8-Mar-16	110,000	-	110,000	7	%	8-Sep-17
d	)	27-Jan-16	18,750	-	18,750	7	%	27-Jul-17
d	)	8-Mar-16	5,000	-	5,000	7	%	8-Sep-17
d	)	8-Mar-16	90,000	-	90,000	8	%	8-Sep-17

b	)	8-Jul-16	50,000	-	50,000	7	%	8-Sep-17
b	)	4-Aug-16	110,000	-	110,000	7	%	8-Sep-17
d	)	15-Aug-16	157,000	-	157,000	7	%	8-Sep-17
d	)	12-Sep-16	83,000	-	83,000	7	%	8-Sep-17
d	)	8-Jul-16	1,250	-	1,250	7	%	8-Sep-17
d	)	4-Aug-16	2,750	-	2,750	7	%	8-Sep-17
d	)	15-Aug-16	3,925	-	3,925	7	%	8-Sep-17
d	)	12-Sep-16	2,075	-	2,075	7	%	8-Sep-17
d	)	4-Aug-16	110,000	-	110,000	8	%	4-Aug-17
b	)	15-Aug-16	157,500	-	157,500	8	%	15-Aug-17
b	)	8-Sep-16	80,000	-	80,000	8	%	8-Sep-17
b	)	11-Nov-16	80,000	-	80,000	8	%	11-Nov-17
b	)	5-Dec-16	88,000	-	88,000	8	%	5-Dec-17
b	)	9-Jan-17	84,000	-	84,000	8	%	6-Jan-18
b	)	13-Mar-17	32,000	-	32,000	8	%	13-Mar-18
c	)	2-Feb-17	90,198	-	90,198	8	%	2-Feb-18
c	)	15-Mar-17	96,000	-	96,000	8	%	15-Mar-18
d	)	7-Oct-16	465,000	63,912	401,088	7	%	7-Apr-18
d	)	7-Nov-16	295,000	47,914	247,086	7	%	7-May-18
d	)	12-Dec-16	295,000	18,033	276,967	7	%	12-Jun-18
d	)	18-Jan-17	295,000	11,543	283,457	7	%	7-Apr-18
b	)	7-Apr-17	25,000	2,754	22,246	8	%	7-Apr-18
b	)	3-May-17	27,000	9,809	17,191	8	%	3-May-18
c	)	5-May-17	30,000	11,574	18,426	8	%	5-May-18
b	)	2-Jun-17	27,000	14,115	12,885	8	%	2-Jun-18
s) d	)	21-Jul-17	698,258	485,908	212,350	10	%	21-Jul-18
s) d	)	21-Jul-17	24,000	6,917	17,083	10	%	21-Jul-18
			6,176,700	672,479	5,504,221

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1. NATURE OF BUSINESS AND GOING CONCERN (Details Narrative) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Working capital deficiency	$ 8,476,105
Accumulated deficit	$ (20,361,716)	$ (19,138,469)

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Accounting Policies [Abstract]
Advertising costs	$ 299	$ 1,397
Allowance for doubtful accounts	$ 0		$ 0
Potentially dilutive shares outstanding	60,719,913,802

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3. INTANGIBLE ASSETS (Details Narrative)	Mar. 31, 2018 USD ($)
Intangible Assets Details Narrative
Trademark	$ 35,000

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4. COMMON AND PREFERRED STOCK (Details Narrative)	3 Months Ended
	Mar. 31, 2018 USD ($)
Common And Preferred Stock Details Narrative
Stock issued	$ 543,000,000

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5. SHARE PURCHASE WARRANTS - Share Purchase Warrants (Details)	3 Months Ended
	Mar. 31, 2018 $ / shares shares
Notes to Financial Statements
Number of warrants outstanding, beginning | shares	1,096,335,757
Warrants issued | shares
Number of warrants outstanding, ending | shares	1,096,335,757
Weighted average exercise price outstanding, beginning | $ / shares	$ 0.004
Warrants issued exercise price | $ / shares
Weighted average exercise price outstanding ending | $ / shares	$ 0.004

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6. STOCK-BASED COMPENSATION - Stock option activity (Details)	3 Months Ended
	Mar. 31, 2018 USD ($) shares
Option price per share | $	$ 1,044
Number | shares	3,075
Stock Option 1
Option price per share | $	$ 1,680
Number | shares	1,725
Stock Option 2
Option price per share | $	$ 400
Number | shares	500
Stock Option 3
Option price per share | $	$ 134
Number | shares	850

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6. STOCK-BASED COMPENSATION (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Stock-based Compensation Details
Number of options, outstanding and exercisable	3,075	3,075	3,075
Weighted average exercise price, outstanding and exercisable	$ 1,044	$ 1,044	$ 1,044
Weighted- Average Remaining Contractual Term, outstanding and exercisable	6 years 6 months 25 days	5 years 6 months 25 days	5 years 3 months 25 days
Aggregate intrinsic value, outstanding and exercisable	$ 0	$ 0	$ 0

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7. COMMITMENTS (Details)	Mar. 31, 2018 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Employment Agreements	$ 225,000

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8. RELATED PARTY TRANSACTIONS AND BALANCES (Details Narrative) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
App hosting	$ 154,455	$ 200,000
Related party accounts payable	598,833		$ 481,078
Officer [Member]
Salaries payable	114,800		132,300
Stock subscription receivable	4,500		4,500
Related party accounts payable	$ 566,211		$ 474,583

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10. CONVERTIBLE DEBENTURES (Details)	3 Months Ended
	Mar. 31, 2018 USD ($)
Net principal	$ 6,176,700
Discount	672,479
Carrying value	$ 5,504,221
Convertible Debt 1
Issuance	Apr. 02, 2013
Net principal	$ 5,054
Discount	0
Carrying value	$ 5,054
Interest rate	0.00%
Maturity date	Jan. 02, 2014
Convertible Debt 2
Issuance	Aug. 05, 2015
Net principal	$ 474,900
Discount	0
Carrying value	$ 474,900
Interest rate	7.00%
Maturity date	Feb. 05, 2017
Convertible Debt 3
Issuance	Aug. 05, 2015
Net principal	$ 18,750
Discount	0
Carrying value	$ 18,750
Interest rate	7.00%
Maturity date	Feb. 05, 2017
Convertible Debt 4
Issuance	Feb. 17, 2015
Net principal	$ 102,135
Discount	0
Carrying value	$ 102,135
Interest rate	8.00%
Maturity date	Feb. 17, 2016
Convertible Debt 5
Issuance	Feb. 17, 2015
Net principal	$ 5,000
Discount	0
Carrying value	$ 5,000
Interest rate	8.00%
Maturity date	Feb. 17, 2016
Convertible Debt 6
Issuance	Feb. 27, 2015
Net principal	$ 37,500
Discount	0
Carrying value	$ 37,500
Interest rate	8.00%
Maturity date	Feb. 27, 2016
Convertible Debt 7
Issuance	Mar. 19, 2015
Net principal	$ 53,551
Discount	0
Carrying value	$ 53,551
Interest rate	8.00%
Maturity date	Mar. 19, 2016
Convertible Debt 8
Issuance	Mar. 19, 2015
Net principal	$ 8,000
Discount	0
Carrying value	$ 8,000
Interest rate	8.00%
Maturity date	Mar. 19, 2016
Convertible Debt 9
Issuance	May 11, 2015
Net principal	$ 50,000
Discount	0
Carrying value	$ 50,000
Interest rate	8.00%
Maturity date	May 11, 2016
Convertible Debt 10
Issuance	Jun. 02, 2015
Net principal	$ 29,500
Discount	0
Carrying value	$ 29,500
Interest rate	8.00%
Maturity date	Jun. 02, 2016
Convertible Debt 11
Issuance	Jun. 02, 2015
Net principal	$ 45,966
Discount	0
Carrying value	$ 45,966
Interest rate	8.00%
Maturity date	Jun. 02, 2016
Convertible Debt 12
Issuance	Jun. 02, 2015
Net principal	$ 10,000
Discount	0
Carrying value	$ 10,000
Interest rate	8.00%
Maturity date	Jun. 02, 2016
Convertible Debt 13
Issuance	Jun. 02, 2015
Net principal	$ 58,540
Discount	0
Carrying value	$ 58,540
Interest rate	8.00%
Maturity date	Jun. 02, 2016
Convertible Debt 14
Issuance	Jun. 02, 2015
Net principal	$ 35,408
Discount	0
Carrying value	$ 35,408
Interest rate	8.00%
Maturity date	Jun. 02, 2016
Convertible Debt 15
Issuance	Jun. 02, 2015
Net principal	$ 20,758
Discount	0
Carrying value	$ 20,758
Interest rate	8.00%
Maturity date	Jun. 02, 2016
Convertible Debt 16
Issuance	Jun. 11, 2015
Net principal	$ 50,000
Discount	0
Carrying value	$ 50,000
Interest rate	8.00%
Maturity date	Mar. 27, 2016
Convertible Debt 17
Issuance	Jun. 19, 2015
Net principal	$ 30,464
Discount	0
Carrying value	$ 30,464
Interest rate	8.00%
Maturity date	Jun. 19, 2016
Convertible Debt 18
Issuance	Jun. 19, 2015
Net principal	$ 30,000
Discount	0
Carrying value	$ 30,000
Interest rate	8.00%
Maturity date	Jun. 19, 2016
Convertible Debt 19
Issuance	Jun. 19, 2015
Net principal	$ 35,408
Discount	0
Carrying value	$ 35,408
Interest rate	8.00%
Maturity date	Jun. 19, 2016
Convertible Debt 20
Issuance	Jun. 24, 2015
Net principal	$ 37,500
Discount	0
Carrying value	$ 37,500
Interest rate	8.00%
Maturity date	Feb. 27, 2016
Convertible Debt 21
Issuance	Jun. 24, 2015
Net principal	$ 35,000
Discount	0
Carrying value	$ 35,000
Interest rate	8.00%
Maturity date	Feb. 12, 2016
Convertible Debt 22
Issuance	Jun. 24, 2015
Net principal	$ 37,500
Discount	0
Carrying value	$ 37,500
Interest rate	8.00%
Maturity date	Mar. 12, 2016
Convertible Debt 23
Issuance	Jul. 07, 2015
Net principal	$ 75,000
Discount	0
Carrying value	$ 75,000
Interest rate	8.00%
Maturity date	Oct. 07, 2015
Convertible Debt 24
Issuance	Aug. 01, 2015
Net principal	$ 17,408
Discount	0
Carrying value	$ 17,408
Interest rate	8.00%
Maturity date	Aug. 04, 2016
Convertible Debt 25
Issuance	Aug. 01, 2015
Net principal	$ 30,000
Discount	0
Carrying value	$ 30,000
Interest rate	8.00%
Maturity date	Aug. 01, 2016
Convertible Debt 26
Issuance	Aug. 01, 2015
Net principal	$ 35,408
Discount	0
Carrying value	$ 35,408
Interest rate	8.00%
Maturity date	Aug. 01, 2016
Convertible Debt 27
Issuance	Sep. 21, 2015
Net principal	$ 64,744
Discount	0
Carrying value	$ 64,744
Interest rate	8.00%
Maturity date	Sep. 21, 2016
Convertible Debt 28
Issuance	May 03, 2016
Net principal	$ 50,000
Discount	0
Carrying value	$ 50,000
Interest rate	8.00%
Maturity date	May 03, 2017
Convertible Debt 29
Issuance	May 03, 2016
Net principal	$ 50,000
Discount	0
Carrying value	$ 50,000
Interest rate	8.00%
Maturity date	May 11, 2016
Convertible Debt 30
Issuance	May 03, 2016
Net principal	$ 29,500
Discount	0
Carrying value	$ 29,500
Interest rate	8.00%
Maturity date	Jun. 02, 2016
Convertible Debt 31
Issuance	May 03, 2016
Net principal	$ 45,965
Discount	0
Carrying value	$ 45,965
Interest rate	8.00%
Maturity date	Jun. 02, 2016
Convertible Debt 32
Issuance	May 24, 2016
Net principal	$ 61,571
Discount	0
Carrying value	$ 61,571
Interest rate	8.00%
Maturity date	May 24, 2017
Convertible Debt 33
Issuance	May 24, 2016
Net principal	$ 30,464
Discount	0
Carrying value	$ 30,464
Interest rate	8.00%
Maturity date	Jun. 19, 2016
Convertible Debt 34
Issuance	May 26, 2016
Net principal	$ 157,500
Discount	0
Carrying value	$ 157,500
Interest rate	8.00%
Maturity date	May 26, 2017
Convertible Debt 35
Issuance	Jun. 15, 2016
Net principal	$ 5,000
Discount	0
Carrying value	$ 5,000
Interest rate	8.00%
Maturity date	Jun. 15, 2017
Convertible Debt 36
Issuance	Jun. 03, 2016
Net principal	$ 160,000
Discount	0
Carrying value	$ 160,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 37
Issuance	Jun. 03, 2016
Net principal	$ 4,000
Discount	0
Carrying value	$ 4,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 38
Issuance	Jun. 15, 2016
Net principal	$ 50,000
Discount	0
Carrying value	$ 50,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 39
Issuance	Jun. 15, 2016
Net principal	$ 1,250
Discount	0
Carrying value	$ 1,250
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 40
Issuance	May 17, 2016
Net principal	$ 100,000
Discount	0
Carrying value	$ 100,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 41
Issuance	May 17, 2016
Net principal	$ 2,500
Discount	0
Carrying value	$ 2,500
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 42
Issuance	May 20, 2016
Net principal	$ 110,000
Discount	0
Carrying value	$ 110,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 43
Issuance	May 20, 2016
Net principal	$ 2,750
Discount	0
Carrying value	$ 2,750
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 44
Issuance	Jan. 27, 2016
Net principal	$ 250,000
Discount	0
Carrying value	$ 250,000
Interest rate	7.00%
Maturity date	Jul. 27, 2017
Convertible Debt 45
Issuance	Mar. 08, 2016
Net principal	$ 110,000
Discount	0
Carrying value	$ 110,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 46
Issuance	Jan. 27, 2016
Net principal	$ 18,750
Discount	0
Carrying value	$ 18,750
Interest rate	7.00%
Maturity date	Jul. 27, 2017
Convertible Debt 47
Issuance	Mar. 08, 2016
Net principal	$ 5,000
Discount	0
Carrying value	$ 5,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 48
Issuance	Mar. 08, 2016
Net principal	$ 90,000
Discount	0
Carrying value	$ 90,000
Interest rate	8.00%
Maturity date	Sep. 08, 2017
Convertible Debt 49
Issuance	Jul. 08, 2016
Net principal	$ 50,000
Discount	0
Carrying value	$ 50,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 50
Issuance	Aug. 04, 2016
Net principal	$ 110,000
Discount	0
Carrying value	$ 110,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 51
Issuance	Aug. 15, 2016
Net principal	$ 157,000
Discount	0
Carrying value	$ 157,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 52
Issuance	Sep. 12, 2016
Net principal	$ 83,000
Discount	0
Carrying value	$ 83,000
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 53
Issuance	Jul. 08, 2016
Net principal	$ 1,250
Discount	0
Carrying value	$ 1,250
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 54
Issuance	Aug. 04, 2016
Net principal	$ 2,750
Discount	0
Carrying value	$ 2,750
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 55
Issuance	Aug. 15, 2016
Net principal	$ 3,925
Discount	0
Carrying value	$ 3,925
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 56
Issuance	Sep. 12, 2016
Net principal	$ 2,075
Discount	0
Carrying value	$ 2,075
Interest rate	7.00%
Maturity date	Sep. 08, 2017
Convertible Debt 57
Issuance	Aug. 04, 2016
Net principal	$ 110,000
Discount	0
Carrying value	$ 110,000
Interest rate	8.00%
Maturity date	Aug. 04, 2017
Convertible Debt 58
Issuance	Aug. 15, 2016
Net principal	$ 157,500
Discount	0
Carrying value	$ 157,500
Interest rate	8.00%
Maturity date	Aug. 15, 2017
Convertible Debt 59
Issuance	Sep. 08, 2016
Net principal	$ 80,000
Discount	0
Carrying value	$ 80,000
Interest rate	8.00%
Maturity date	Sep. 08, 2017
Convertible Debt 60
Issuance	Nov. 11, 2016
Net principal	$ 80,000
Discount	0
Carrying value	$ 80,000
Interest rate	8.00%
Maturity date	Nov. 11, 2017
Convertible Debt 61
Issuance	Dec. 05, 2016
Net principal	$ 88,000
Discount	0
Carrying value	$ 88,000
Interest rate	8.00%
Maturity date	Dec. 05, 2017
Convertible Debt 62
Issuance	Jan. 09, 2017
Net principal	$ 84,000
Discount	0
Carrying value	$ 84,000
Interest rate	8.00%
Maturity date	Jan. 06, 2018
Convertible Debt 63
Issuance	Mar. 13, 2017
Net principal	$ 32,000
Discount	0
Carrying value	$ 32,000
Interest rate	8.00%
Maturity date	Mar. 13, 2018
Convertible Debt 64
Issuance	Feb. 02, 2017
Net principal	$ 90,198
Discount	0
Carrying value	$ 90,198
Interest rate	8.00%
Maturity date	Feb. 02, 2018
Convertible Debt 65
Issuance	Mar. 15, 2017
Net principal	$ 96,000
Discount	0
Carrying value	$ 96,000
Interest rate	8.00%
Maturity date	Mar. 15, 2018
Convertible Debt 66
Issuance	Oct. 07, 2016
Net principal	$ 465,000
Discount	63,912
Carrying value	$ 401,088
Interest rate	7.00%
Maturity date	Apr. 07, 2018
Convertible Debt 67
Issuance	Nov. 07, 2016
Net principal	$ 295,000
Discount	47,914
Carrying value	$ 247,086
Interest rate	7.00%
Maturity date	May 07, 2018
Convertible Debt 68
Issuance	Dec. 12, 2016
Net principal	$ 295,000
Discount	18,033
Carrying value	$ 276,967
Interest rate	7.00%
Maturity date	Jun. 12, 2018
Convertible Debt 69
Issuance	Jan. 18, 2017
Net principal	$ 295,000
Discount	11,543
Carrying value	$ 283,457
Interest rate	7.00%
Maturity date	Apr. 07, 2018
Convertible Debt 70
Issuance	Apr. 07, 2017
Net principal	$ 25,000
Discount	2,754
Carrying value	$ 22,246
Interest rate	8.00%
Maturity date	Apr. 07, 2018
Convertible Debt 71
Issuance	May 03, 2017
Net principal	$ 27,000
Discount	9,809
Carrying value	$ 17,191
Interest rate	8.00%
Maturity date	May 03, 2018
Convertible Debt 72
Issuance	May 05, 2017
Net principal	$ 30,000
Discount	11,574
Carrying value	$ 18,426
Interest rate	8.00%
Maturity date	May 05, 2018
Convertible Debt 73
Issuance	Jun. 02, 2017
Net principal	$ 698,258
Discount	485,908
Carrying value	$ 212,350
Interest rate	8.00%
Maturity date	Jun. 02, 2018
Convertible Debt 74
Issuance	Jul. 21, 2017
Net principal	$ 27,000
Discount	14,115
Carrying value	$ 12,885
Interest rate	8.00%
Maturity date	Jul. 21, 2018
Convertible Debt 75
Issuance	Jul. 21, 2017
Net principal	$ 24,000
Discount	6,917
Carrying value	$ 17,083
Interest rate	10.00%
Maturity date	Jul. 21, 2018

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10. CONVERTIBLE DEBENTURES (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Debt Disclosure [Abstract]
Proceeds from convertible debentures	$ 207,000	$ 628,060
Transaction costs	255	29,250
Accretion and interest expense	867,561	$ 646,264
Principal amount	$ 6,176,700

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11. LOSS ON INVESTMENT AND INTANGIBLE ASSET (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Loss On Investment And Intangible Asset Details Narrative
Loss on investment	$ 0	$ 175,000