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.
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 JuneSeptember 30, 2019, the Company has a working capital deficiency of $9,736,527$10,830,845 and has an accumulated deficit of $23,009,471$24,178,789 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.
FRIENDABLE, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)6
FOR THE PERIOD ENDED JUNE 30, 2019
(Expressed in US dollars)
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 consolidated 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 sixnine months ended JuneSeptember 30, 2019, the Company incurred $16,970 (June$48,409 (September 30, 2018: $1,396)$1,474) 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.
FRIENDABLE, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE PERIOD ENDED JUNE 30, 2019
(Expressed in US dollars)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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 sixnine months ended JuneSeptember 30, 2019 and 2018, the Company did not have any allowance for doubtful accounts.
Financial Instruments
Financial assets and financial liabilities are recognized in the consolidated balance sheet when the Company has become party to the contractual provisions of the instruments.
The Company’s financial instruments consist of accounts payable, convertible debentures and promissory note. 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 consolidated 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 JuneSeptember 30, 2019, there were approximately 61,125,546,5283,383,314 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.
FRIENDABLE, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE PERIOD ENDED JUNE 30, 2019
(Expressed in US dollars)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Recent Accounting Pronouncements
In February 2016, the FASB issued ASU No. 2016-02, Leases (ASC Topic 842) (“ASU 2016-02”), which requires lessees to recognize at the commencement date for all leases, with the exception of short-term leases, (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. ASU 2016-02 will take effect for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The ASU requires adoption using a modified retrospective transition approach with either (a) periods prior to the adoption date being recast or (b) a cumulative-effect adjustment recognized to the opening balance of retained earnings on the adoption date with prior periods not recast. The the adoption of ASU No. 2016-02 did not have an effect on its consolidated financial statements.
3. COMMON AND PREFERRED STOCK
Common Stock:
Issued during 2019
None.
Issued during 2018
During the 12 months ended December 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.
Reverse Split
On August 27, 2019, the Company completed a common stock reverse stock split at a ratio of 18,000 to 1. The reverse stock split has been retrospectively applied to all common stock, weighted average common stock, and loss per common stock disclosures.
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.
Stock Subscriptions Received:
During the sixnine months ended JuneSeptember 30, 2019, the Company sold a number of its common shares to be issued upon the completion of the reverse split of the Company’s stock as set forth in the Company’s filing on Form 14C as filed with the Commission on May 7, 2018. The total number of post-split shares to be issued is 994,000. As the split is not yet effective,of September 30, 2019, the Company has not issued these shares. The share numbers set forth below represent the post-split number of shares to be issued by the Company.
During the sixnine months ended JuneSeptember 30, 2019, the Company received $250,368$325,368 in proceeds related to Security Purchase Agreements (SPA’s) for the purchase of common stock in the Company. The SPA’s are of two separate types. In the first type of SPA, the holders are entitled to shares of the Company’s stock and Company founders pledge to match the shares on a 1:1 basis from their personal shares. In the second type of SPA, investors will be issued common stock and revenue sharing rights, plus, depending on investments levels holders will be awarded app subscriptions, merchandise, backstage passes to celebrity events, and travel expenses. As of JuneSeptember 30, 2019, no shares or awards have been issued in relation to these SPA’s.
4. SHARE PURCHASE WARRANTS
Balance of share purchase warrants as of JuneSeptember 30, 2019 and year ended June 30,December 31, 2018 are:
| | |
| | |
| | |
Balance, June 30, 2018 | 1,096,335,757 | 0.004 |
| | |
Balance, June 30, 2019 | 1,096,335,757 | 0.004 |
| | |
| | |
| | |
| | |
Balance, December 31, 2018 | 60,908 | 79.16 |
| | |
Balance, September 30, 2019 | 60,908 | 79.16 |
| | |
FRIENDABLE, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE PERIOD ENDED JUNE 30, 2019
(Expressed in US dollars)
5. STOCK-BASED COMPENSATION
On November 22, 2011, the Board of Directors of the Company 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 June 30, 2019:
| | |
Expiry Date | | |
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 JuneSeptember 30, 2019, no options have been awarded under the 2014 Plan.
The following table summarizes Effective August 27, 2019, the Company’s stockCompany effected a reverse split of 18,000 to 1 (Note 3) which eliminated all the options outstanding and exercisable:
| | Weighted Average Exercise Price $ | Weighted- Average Remaining Contractual Term (years) | Aggregate Intrinsic Value $ |
Outstanding and exercisable, December 31, 2017 | 3,075 | 1,044 | 6.57 | - |
Outstanding and exercisable, June 30, 2018 | 3,075 | 1,044 | 5.57 | - |
Outstanding and exercisable, June 30, 2019 | 3,075 | 1,044 | 4. 57 | - |
which were previously outstanding.
6. COMMITMENTS
The following table summarizes the Company’s significant contractual obligations as of JuneSeptember 30, 2019:
| | $ |
| | |
Employment Agreements (1) | | 150,000100,000 |
(1) Employment agreements with related parties.
FRIENDABLE, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE PERIOD ENDED JUNE 30, 2019
(Expressed in US dollars)
7. RELATED PARTY TRANSACTIONS AND BALANCES
During the sixnine months ended JuneSeptember 30, 2019, the Company incurred $229,600$344,400 (2018: $229,600)$344,400) in salaries to officers and directors with such costs being recorded as general and administrative expenses.
During the sixnine months ended JuneSeptember 30, 2019, the Company incurred $15,767, $55,000,$18,068, $155,500, and $30,000$45,000 (2018: $279,305,$420,425, $0, and $30,000)$45,000) 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 JuneSeptember 30, 2019, the Company had a stock subscription receivable totaling $4,500 (December 31, 2018: $4,500) from an officer and director and from a company with an officer and director in common.
As of JuneSeptember 30, 2019, accounts payable includes $82,566$65,717 (December 31, 2018: $721,099) payable to a company with two officers and directors in common, and $581,331$683,831 (December 31, 2018: $798,580) payable in salaries to directors and officers of the Company. The amounts are unsecured, non-interest bearing and are due on demand.
During the sixnine months ended JuneSeptember 30, 2019, three officers forgave debt totaling $400,000 and a company controlled by two officers of the Company forgave debt totaling $600,000. The debt forgiveness was considered a capital transaction and therefore $1,000,000 was recorded as an increase in additional paid-in capital as of JuneSeptember 30, 2019.
The above transactions were recorded at their exchange amounts, being the amounts agreed by the related parties.
8. 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 and promissory note approximates their carrying values as the underlying imputed interest rates approximates the estimated current market rate for similar instruments.
As of JuneSeptember 30, 2019, there were no assets or liabilities measured at fair value on a recurring basis presented on the Company’s consolidated balance sheet, other than cash.
FRIENDABLE, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE PERIOD ENDED JUNE 30, 2019
(Expressed in US dollars)
9. 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 |
FRIENDABLE, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE PERIOD ENDED JUNE 30, 2019
(Expressed in US dollars)
9. CONVERTIBLE DEBENTURES (CONTINUED)
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 | - | 465,000 | 7 | % | 7-Apr-18 |
d | ) | 7-Nov-16 | 295,000 | - | 295,000 | 7 | % | 7-May-18 |
d | ) | 12-Dec-16 | 295,000 | - | 295,000 | 7 | % | 12-Jun-18 |
d | ) | 18-Jan-17 | 295,000 | - | 295,000 | 7 | % | 7-Apr-18 |
b | ) | 7-Apr-17 | 25,000 | - | 25,000 | 8 | % | 7-Apr-18 |
b | ) | 3-May-17 | 27,000 | - | 27,000 | 8 | % | 3-May-18 |
c | ) | 5-May-17 | 30,000 | - | 30,000 | 8 | % | 5-May-18 |
b | ) | 2-Jun-17 | 27,000 | - | 27,000 | 8 | % | 2-Jun-18 |
s) d | ) | 21-Jul-17 | 790,965 | - | 790,965 | 10 | % | 21-Jul-18 |
s) d | ) | 14-Aug-18 | 30,000 | - | 30,000 | 10 | % | 31-Dec-18 |
s) d | ) | 21-Jul-17 | 24,000 | - | 24,000 | 10 | % | 21-Jul-18 |
| | | | | | | | |
| | | 6,299,407 | - | 6,299,407 | | | |
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.
FRIENDABLE, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE PERIOD ENDED JUNE 30, 2019
(Expressed in US dollars)
9. CONVERTIBLE DEBENTURES (CONTINUED)
At JuneSeptember 30, 2019, convertible debentures with the principal amount of $6,299,407 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 JuneSeptember 30, 2019 the conversion features and non-standard anti-dilution provisions would not meet derivative classification.
Convertible debentures with maturity dates prior to JuneSeptember 30, 2019 are now due on demand.
10. PROMISSORY NOTE
On December 14, 2018, the Company issued a promissory note for proceeds of $100,000 at 12% interest per annum. The maturity date of the note is December 14, 2019. The note includes a conversion feature that entitles the holder to receive 1.63% equity ownership of Friendable, Inc. and 18.2% equity ownership of Fan Pass, Inc. upon conversion. During the sixnine months ended JuneSeptember 30, 2019, the Company incurred $5,951$9,535 in interest expense in connection with the promissory note.
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 JuneSeptember 30, 2019 the conversion features and non-standard anti-dilution provisions would not meet derivative classification.
11. DEBT RESTRUCTURE AGREEMENT
On March 26, 2019, the Company entered into a Debt Restructuring Agreement with related parties Robert A. Rositano Jr., Dean Rositano, Frank Garcia, and Checkmate Mobile, Inc. and Alpha Capital Anstalt, Coventry Enterprises, LLC, Palladium Capital Advisors, LLC, EMA Financial, LLC, Michael Finkelstein, and Barbara R. Mittman, each being a debt holder of the Company.
The debt holders have agreed to convert their debt into certain amounts of common stock as set forth in the Agreement upon the Company meeting certain milestones including but not limited to: the Company effecting a reverse stock split and maintaining a stock price of $1.00 per share; being current with its periodic report filings pursuant to the Securities Exchange Act; Checkmate Mobile, Inc. and Company officers forgiving an aggregate of $1,000,000 in amounts owed to them; the Company raising not less than $400,000 in common stock at a post-split price of not less than $0.20 per share; and certain other things as further set forth in the Agreement. The debt holders will be subject to certain lock up and leak out provisions as contained in the Agreement.
Integrity Media, Inc. (“Integrity”) had previously filed a lawsuit against the Company and the CEO of the Company for $500,000 alleging breach of contract alleging the Company failed to deliver marketable securities in exchange for services. The Company answered the allegations in court and Integrity filed a motion attacking the Company’s answers. The court did not strike the answers but the clerk of the court entered a default judgment against the Company in the amount of $1,192,875 plus 10% interest. On May 8, 2019, the Company received a tentative ruling on the Company’s motion to vacate the default judgement whereby the previously entered default judgement has now been voided and a trial date of August 26, 2019 has beenwas set. The Company fully intends to defend itself against these allegations and believes that the claim is without merit.
13. SUBSEQUENT EVENTS
Subsequent to June 30, 2019, the Company received $75,000 in proceeds related to Security Purchase Agreements (SPA’s) for the purchase of Series B preferred stock in the Company. As of August 20, 2019, no shares have been issued in relation to these SPA’s.
Subsequent to June 30, 2019, the Company entered in an agreement with a third party to develop a web and mobile application for use on IOS, Android, and the web. As of August 20, 2019, the Company has received a startup payment of $38,000.
On July 3, 2019, Alpha Capital Anstalt sold and assigned all of its Notes, with the Company to Ellis International LP. Simultaneously therewith, Ellis joined the Debt Restructure Agreement taking the place of Alpha Capital. Alpha Capital is no longer a debt holder of the Company. There were no changes in terms of any of the Notes acquired by Ellis from Alpha Capital and no changes to the Debt Restructure Agreement as a result of the Assignment by By Alpha Capital to Ellis or as a result of Ellis's joinder in the Debt Restructure Agreement.
12. CONTINGENCY (CONTINUED)
On September 19, 2019, the Company entered into a Settlement Agreement with Integrity Media settling the civil action known as Integrity Media, Inc. vs. Friendable, Inc. et al., Orange County Case No. 30-2016-00867956-CU-CO-CJC. Pursuant to the Settlement Agreement, the Company agreed to issue to Integrity 750,000 shares of its common stock in exchange for 275 of the Company’s preferred shares held by Integrity and the cash payment of $30,000 for costs. The cash payment is to be made within 6 months of the date of the Settlement Agreement. Additionally, Integrity will be entitled to additional shares if (i) the price of the Company’s common stock is below $1.34 at either the 120 day or 240 day reset dates set forth in the Company’s Debt Restructure Agreement entered into with various debt holders on March 26, 2019 and filed on Form 8-K on April 15, 2019. Integrity will also be entitled to a “true-up” by issuance of additional common shares on the issuance date should the share price of the Company’s common stock on the issuance date be below $1. The true-up shares will adjust the value of the aggregate shares issued to be $750,000 on the date of issuance. As at November 19, 2019, no shares have been issued nor cash paid.
Robert Rositano, the Company’s CEO, has also personally guaranteed the Company’s compliance with the terms of the Settlement Agreement.
13. SUBSEQUENT EVENTS
Subsequent to September 30, 2019, the Company issued 2,000,000 shares of common stock to a consultant in exchange for investor relations services.
Subsequent to September 30, 2019, the Company issued 33,418 shares of common stock in connection with conversion of convertible notes in the amount of $8,355.
Subsequent to September 30, 2019, the Company issued 120,000 shares of common stock in connection with conversion of convertible notes in the amount of $1,920.
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 April 29, 2014, FINRA approved a 20 for 1 reverse stock split whereby 937,459,274 shares of the Company’s common stock then issued and outstanding, were exchanged for 46,872,964 shares of the Company’s common stock.
On March 19, 2015, FINRA approved a 100 for 1 reverse stock split whereby 2,355,489,991, shares of the Company’s common stock then issued and outstanding, were exchanged for 23,554,923 shares of the Company’s common stock.
On October 26, 2015, the Company issued a press release announcing that FINRA had approved a change to our trading symbol for our common stock which is quoted on the OTC Pink marketplace. Effective October 27, 2015 our trading symbol was changed from “HKUP” to “FDBL”. This change was made in conjunction with the Company’s filing of a Certificate of Amendment on September 28, 2015 to its Articles of Incorporation changing the name of the Company from “iHookup Social, Inc.” to “Friendable, Inc.” The company had previously announced a re-branding our app from "iHookup Social" to "Friendable". As a result, the Company desired to change its name to match the rebranding so as to be more specific to the Company’s core values and its products/services, creating a more recognizable brand that creates less confusion.
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 undertake the development of the mobile application “The Fan Pass App”.
On August 27, 2019, FINRA approved a 18,000 for 1 reverse stock split whereby 5,553,310,369, shares of the Company’s common stock then issued and outstanding, were exchanged for 314,726 shares of the Company’s common stock.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS- continuedWho We Are
About Friendable, Inc.
Friendable, Inc. is a mobile focused technology and marketing company, connecting and engaging users through two distinctly branded applications:
The Friendable and Fan Pass Mobile Applications.
The Company initially released its flagship product Friendable, as a social application where users can create one-on-one or group-style meetups. In 2019 the Company released its new version of Friendable with a focus on dating and building subscription based revenue, starting with its existing and historical database of approximately 900,000 registered users.
Fan Pass is the Company’s newest app/brand and wholly owned subsidiary, scheduled for release in 2019. Fan Pass believes in connecting Fans of their favorite celebrity or artist, to an exclusive VIP or Backstage experience, right from their smart phone or other connected devices. Fan Pass allows an artist fan base to experience something they would otherwise never have the opportunity to afford or geographically attend. The Company aims to establish both Friendable and Fan Pass as premier brands and mobile platforms that are dedicated to connecting and engaging users from anywhere around the World.
Mobile Applications
Introduction
The Friendable Mobile Application:
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS- continued
Friendable’s platform is a location-based social platform which creates a “Subscription” based opportunity and location-based advertising for Brands and Businesses. Friendable is marketed as a friendly non-threatening environment for everyone with a "friends-first" approach to making new connections and where everything starts with friendship. The company plans to continue upgrading its application & acquire new registered users and subscribers to increase revenue, engagement and overall # of monthly active users (MAU).
In January 2019, the Company released a brand new ground up version of the friendable application which is to focus on generating subscription based revenue. Based on several factors which included the reliance on outdated software and ongoing neggiations to reduce the company’s debt, the Company purged all legacy users. In doing so, the Company will rely upon aqcuiring new users and marketing to the prior legacy database in an attempt to convert them into active, paying subscribers.
The Friendable application has undergone several versions over the past 5 years and has historically accomplished the following:
-
Exceeded 1,500,000 total downloads
-
Exceeded 900,000 historical registered users
-
Worldwide App store rankings & Celebrity Marketing Integration
-
Ranked in the top 400 social networking apps in over 80 countries around the world
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Ranked in the top 1000 social networking apps in 147 countries around the world.
-
Reached #4 Social Networking apps in France
-
Reached 34 in top grossing apps in US
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Achieved #1 position for all Social Networking apps in Australia, Aug 2016
-
Partnered with “TKA” The KlugerAgency (responsible for “Plenty of Fish” roll out with “LADY GA GA” & “Tinder” user acquisition with “HILLARY DUFF”
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Integrated in notable artists videos like Jennifer Lopez, Fifth Harmony, Fetty Wap, Meghan Trainor, Red Foo and Austin Mahone
-
January 2019 – Release of our completely re-done new version of the Friendable mobile application aimed at subscription based revenue.
Historically, Friendable’s apps have been downloaded total over 1.5 million times across iOS and Android.
Management believes that its Friendable application is in need of additional feature set upgrades, expansion and intelligent technology integration to stay competitive in the Social Networking / Dating category and will continue on this path while developing and launching Fan Pass. Management believes that the cross promotion of Fan Pass users to the Friendable application will allow us to acquire Friendable subscribers at much lower cost than if acquiring users through its own marketing directives.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS- continued
The Fan Pass Live Application (Development Stage)
In 2019, the Company partnered with Vimeo, Inc to develop and release its Fan Pass mobile application for commercial release on its Vimeo OTT / Livestream platform for iPhone, Android, Apple TV, Android TV, and Roku.
●
Backstage access before, during or after an event
●
Sound Check – Recording studio sessions
●
Behind-the-scenes looks on music video, film, or photo-shoot sets – Green Room
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FREE Content – Social Influencer video (shot front facing)
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On-set makeup or wardrobe trailers
●
Special interviews & one-on-one videos
●
Looks into the behind-the-scenes lives of the celebrity’s
And more exclusive VIP content!
In addition, fans will be able to subscribe and view all livestream and on-demand archived videos; or subscribe to an individual broadcast instead. 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.
Fan Pass believe's in connecting fans globally..to an exclusive backstage experience, right from their smartphone!
Marketing
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:
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS- continued
Celebrity Marketing
Celebrity partners will utilize the following channels to market Fan Pass:
●
Label and/or Management Social Media
Event Marketing
The Fan Pass marketing / business development team will market the application at:
●
Live events – Concerts, Festivals, Private Events, Promotional Events
In addition, Fan Pass video and photography crews will take pictures and videos at events for public relations and social media.
Digital Marketing
Fan Pass will utilize digital marketing avenues such as:
●
Digital ad campaigns on social media, search, and email
Digital marketing initiatives will utilize celebrity content and user generated content for maximum market reach.
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:
Revenue
The Friendable application revenue is derived from premium subscriptions within the application. Additional revenue may come from advertising and virtual currency.
The Company believes the Fan Pass application will generate revenue utilizing various avenues of pursuit:
■
Fan Pass Subscriptions - Initial pricing model example:
o
$2.99 per month – all access VIP
o
$12.99 single PPV event.
■
Brand sponsorship and/or monthly branded campaigns
■
Social media influencers and promotion
■
Content creation and development
■
Pre-Roll Video Advertising revenue from both live and archived videos
■
E-Commerce Merchandise Sales - including t-shirts, hats, and more
Market Opportunity
Market Overview: Fan Pass
As our digital age continues to evolve, today we see the creation of a new type of end-user: the ever-present “Omni-user” with an overwhelming appetite for content. These people are an emerging class of knowledgeable users that demand constant access to content, people and celebrities they follow, from work to play or from home, anywhere in the world. Fan Pass was created to satisfy the needs of these omni-users. It is only in the last five years that technology and social media have evolved to a point that allows Fan Pass to become a disruptive opportunity.
Consider these facts; Less than a dozen years ago the first mobile phone was invented. Only five years ago, mobile devices started to become less annoying and more useful. It has taken these last five years for processors to become fast, displays to become large and clear, storage to become easily available, and cellular and Wi-Fi networks to be “Omni-present” making mobile devices a useful and always present, necessity in life. At the same time, social media networks have had time to grow strong, reliable and also “Omni-present” thus allowing celebrities and influencers to build vast armies of Fans or “Social Followers”.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS- continuedResults of Operations
| Three Months Ended June 30, 2019 $ | Three Months Ended June 30, 2018 $ | Six Months Ended June 30, 2019 $ | Six Months Ended June 30, 2018 $ | Three Months Ended September 30, 2019 $
| Three Months Ended September 30, 2018 $
| Nine months Ended September 30, 2019 $
| Nine months Ended September 30, 2018 $
|
REVENUES | 856 | 1,401 | 1,861 | 4,482 | 118,801 | 1,227 | 120,662 | 5,709 |
| | |
OPERATING EXPENSES | | |
Accretion and interest expense | 131,905 | 529,268 | 264,557 | 1,396,829 | |
App hosting | 767 | 139,970 | 15,767 | 279,425 | |
Accretion and interest expense (Note 9, 10) | | 189,117 | 478,102 | 453,674 | 1,874,931 |
App hosting (Note 7) | | 2,301 | 141,000 | 18,068 | 420,425 |
Commissions | 257 | 421 | 558 | 1,305 | 61 | 368 | 619 | 1,673 |
General and administrative | 193,711 | 193,247 | 390,253 | 411,185 | |
Product development | 25,000 | - | 55,588 | - | |
General and administrative (Note 7) | | 187,352 | 186,090 | 577,605 | 597,275 |
Product development (Note 7) | | 100,500 | 549 | 156,088 | 549 |
Sales and marketing | 17,925 | 1,097 | 24,136 | 1,587 | 28,788 | 598 | 52,924 | 2,185 |
| | |
| | |
TOTAL OPERATING EXPENSES | 369,565 | 864,003 | 750,859 | 2,090,331 | 508,119 | 806,707 | 1,258,978 | 2,897,038 |
| | |
LOSS FROM OPERATIONS | (368,769) | (862,602) | (748,998) | (2,085,849) | (389,318) | (805,480) | (1,138,316) | (2,891,329) |