UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

Amendment No. 1 to

FORM 10-Q

 

x[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31,September 30, 2014

 

or

 

o[_] 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 000-54009

 

FREEBUTTON, INC.

(Exact name of registrant as specified in its charter)

 

Nevada20-5982715
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)

 

7040 Avenida Encinas
Suite 104-159

Carlsbad, CA 92011
(Address of principal executive offices) (Zip Code)

 

(760) 487-7772
(Registrant’s telephone number, including area code)

 

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. Yesx [X] No¨ [_]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x[X] 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.

 

Large accelerated filero [_]Accelerated filero [_]
  
Non-accelerated fileroSmaller reporting companyx
(Do [_] (Do not check if a smaller reporting company)Smaller reporting company [X]

 

Indicate by check mark whether the registrant is a shell company (as defined in Rulerule 12b-2 of the Exchange Act)Act). Yes o[_] Nox [X]

 

As of May 13,December 15, 2014, the registrant had 33,844,260 shares of common stock, $0.001 par value, outstanding.

 

 
 

 

EXPLANATORY NOTE

This Amendment No. 1 to Form 10-Q (“Amendment No.”) amends the Quarterly Report of FreeButton, Inc. on Form 10-Q for the quarter ended March 31, 2014, as filed with the Securities and Exchange Commission on May 15, 2014.  This Amendment No. 1 is being filed for the purpose of correcting certain errors in our Financial Statements and amending related disclosure in the section titled Management’s Discussion and Analysis of Financial Condition.  Additionally, thisAmendment No. 1 is being filed to furnish the Interactive Data files as Exhibit 101, in accordance with Rule 405 of Regulation S-T.

FREEBUTTON, INC.

 

QUARTERLY REPORT ON FORM 10-Q
March 31,September 30, 2014

 

TABLE OF CONTENTS

 

PART I. FINANCIAL INFORMATION4
  
Item 1. Financial Statements4
  
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operation15
ITEM 3. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK1614
  
ITEM 4. CONTROLS AND PROCEDURES1614
  
PART II. OTHER INFORMATION1716
  
ITEM 1. LEGAL PROCEEDINGS1716
  
ITEM 1A. RISK FACTORS1716
  
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS1716
  
ITEM 3. DEFAULTS UPON SENIOR SECURITIES1816
  
ITEM 4. MINE SAFETY DISCLOSURES.DISCLOSURES1816
  
ITEM 5. OTHER INFORMATION1817
  
ITEM 6. EXHIBITS1917

 

Use of Certain Defined Terms

 

Except as otherwise indicated by the context, references in this report to “we,” “us,” “our,” “our Company,” or “the Company” are to the combined business of FreeButton, Inc.

 

Forward-Looking Statements

 

This report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements discuss matters that are not historical facts. Because they discuss future events or conditions, forward-looking statements may include words such as “anticipate,” “believe,” “estimate,” “intend,” “could,” “should,” “would,” “may,” “seek,” “plan,” “might,” “will,” “expect,” “anticipate,” “predict,” “project,” “forecast,” “potential,” “continue” negatives thereof or similar expressions. Forward-looking statements speak only as of the date they are made, are based on various underlying assumptions and current expectations about the future and are not guarantees. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, level of activity, performance or achievement to be materially different from the results of operations or plans expressed or implied by such forward-looking statements.

 

We cannot predict all of the risks and uncertainties that may effect the Company. Accordingly, such information should not be regarded as representations that the results or conditions described in such statements or that our objectives and plans will be achieved and we do not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. These forward-looking statements are found at various places throughout this report and include information concerning possible or assumed future results of our operations, including statements about potential acquisition or merger targets; business strategies; future cash flows; financing plans; plans and objectives of management; any other statements regarding future acquisitions, future cash needs, future operations, business plans and future financial results, and any other statements that are not historical facts.

 

These forward-looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events and are subject to risks, uncertainties and other factors. Many of those factors are outside of our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of the report. All subsequent written and oral forward-looking statements concerning other matters addressed in this report and attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this report.

 

Except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise.

 

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

 

FREEBUTTON, INC.

(Formerly Secured Window Blinds, Inc.)

(A Development Stage Company)

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

March 31,September 30, 2014

 

 

CONDENSED CONSOLIDATED BALANCE SHEETSPg. 5
 
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONSPg. 6
  
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSPg. 7
  
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTSPg. 8

4

 

FREEBUTTON, INC.

(A Development Stage Company)

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 March 31,
2014
 December 31,
2013
  September 30,
2014
 December 31,
2013
 
 (Unaudited) (Audited)  (Unaudited) (Audited) 
ASSETS                
                
CURRENT ASSETS                
Cash $2,077  $85,906  $60,908  $3,856 
Accounts receivable     2,067 
Inventory  15,395   24,757 
                
TOTAL CURRENT ASSETS  2,077   85,906   76,303   30.680 
                
FIXED ASSETS        
Office Equipment, Net  2,227   3,101 
        
OTHER ASSETS          4,193   4,193 
Web Development Costs  18,845   18,845 
        
TOTAL OTHER ASSETS  18,845   18,845 
                
TOTAL ASSETS $23,149  $107,852  $80,496  $34,873 
                
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)                
                
CURRENT LIABILITIES                
Accounts payable and accrued liabilities $38,981  $39,241  $49,606  $1,560 
Convertible Promissory Notes (Note 5)  337,266   315,240 
Other liability     71,750 
Convertible Promissory Notes (Note 6)  354,095    
Related Party Loans  42,894   31,186 
                
TOTAL CURRENT LIABILITIES  376,247   426,231   446,595   32,746 
                
TOTAL LIABILITIES  376,247   426,231   446,595   32,746 
                
STOCKHOLDERS’ EQUITY (DEFICIT)                
Capital stock (Note 3)                
Authorized
75,000,000 shares of common stock, $0.001 par value,
        
Issued and outstanding
33,807,000 shares of common stock (December 31, 2013 –33,807,000 )
  33,807   33,807 
Authorized        
75,000,000 shares of common stock, $0.001 par value,        
Issued and outstanding        
33,844,260 shares of common stock (December 31, 2013 –500)  33,844   500 
Additional paid-in capital  175,865   175,865      (500)
Subscription receivable  83,650    
Deficit accumulated during the development stage  (562,770)  (528,051)  (483,594)  2,127 
                
TOTAL STOCKHOLDERS’ EQUITY (DEFICIT)  (353,098)  (318,379)  (366,099)  2,127 
                
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) $23,149  $107,852  $80,496  $34,873 

 

Going Concern (Note 1)

 

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

FREEBUTTON, INC.

(A Development Stage Company)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

  Three months ended
March 31,
2014
  Three months ended
March 31,
2013
  November 27, 2006 (inception) to March 31, 2014 
          
          
REVENUE $  $  $5,000 
             
EXPENSES            
Office and general $8,172  $22,836  $140,082 
Management fee  2,300   33,000   179,800 
Marketing expenses  396   10,567   40,399 
Professional fees  17,479   21,824   187,533 
             
TOTAL EXPENSES  (28,347)  (88,227)  (547,814)
             
NET OPERATING LOSS  (28,347)  (88,227)  (542,814)
             
OTHER INCOME (EXPENSES)            
Exchange loss        (620)
Loan interest  (6,372)  (3,206)  (33,154)
Gain (loss) on debt settlement        10,000 
             
TOTAL OTHER INCOME (EXPENSES)  (6,372)  (3,206)  (23,774)
INCOME (LOSS) FROM CONTINUING OPERATIONS  (34,719)  (91,433)  (566,588)
             
DISCONTINUED OPERATIONS            
Gain from operations of Media Rhythm        3,818 
             
NET LOSS $(34,719) $(91,433) $(562,770)
             
             
BASIC LOSS PER COMMON SHARE FROM CONTINUING OPERATIONS $(0.00) $(0.00)   
BASIC LOSS PER COMMON SHARE FROM DISCONTINUED OPERATIONS $(0.00) $(0.00)   
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING-BASIC  33,807,000   33,340,422    

  Three Months Ended
September 30
  Nine Months Ended
September 30
 
  2014  2013  2014  2013 
REVENUE                
Net sales $71,765  $71,538  $191,534  $155,284 
Cost of goods sold  (18,552)  (28,483)  (62,460)  (78,842)
                 
GROSS PROFITS  53,213   43,055   129,074   76,442 
                 
EXPENSES                
Selling, general & administrative $75,714  $25,419  $170,631  $50,386 
                 
TOTAL EXPENSES  (75,714)  (25,419)  (170,631)  (50,386)
                 
NET OPERATING PROFIT (LOSS):  (22,501)  17,636   (41,557)  26,056 
                 
OTHER INCOME (EXPENSES)                
Other income        3,400    
Loan interest  (10,639)     (10,639)   
Gain (loss) on debt settlement  5,700      5,700    
                 
TOTAL OTHER INCOME (EXPENSES)  (4,939)     (1,539)   
                 
NET INCOME (LOSS) $(27,440) $17,636  $(43,096) $26,056 
                 
BASIC PROFIT (LOSS) PER COMMON SHARE $(0.00) $35.27  $(0.00) $52.11 
                 
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - BASIC  33,844,260   500   33,844,260   500 

 

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

6

FREEBUTTON, INC.

(A Development Stage Company)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 Three months
ended
March 31,
2014
 Three months
ended
March 31,
2013
 November 27, 2006 (date of inception) to March 31,
2014
 
        Nine months
ended
September 30,
2014
 Nine months
ended
September 30,
2013
 
OPERATING ACTIVITIES                    
Net loss for the period $(34,719) $(91,433) $(562,770)
Gain(loss) from discontinued operations        3,818 
Loss from continuing operating  (34,719)  (91,433)  (558,952)
Net income (loss) for the period $(43,096) $26,056
Adjustments to reconcile net loss to net cash used in operating activities:                    
Gain on debt settlement         (10,000)
Depreciation expenses  203   203   1,324 
Common stock issued for service     4,430   4,430 
Accounts receivable  2,067   
Inventory  9,362   (48,490)
Changes in operating assets and liabilities:                    
Increase (decrease) in accounts payables and accrued liabilities  (259)  7,952   45,417   8,005    
Increase (decrease) in other liability  (71,750)        9,593   (4,194)
                    
NET CASH USED IN CONTINUED OPERATING ACTIVITIES  (106,525)  (78,848)  (517,781)
NET CASH PROVIDED BY DISCONTINUED OPERATING ACTIVITIES        3,719 
NET CASH USED IN OPERATING ACTIVITIES  (106,525)  (132,833)  (514,602)  (14,069)  (26,628)
                    
INVESTING ACTIVITIES            
Furniture and Equipment  670      (3,452)
Web development costs and acquisitions        (18,845)
NET CASH USED IN INVESTING ACTIVITIES        
Cash assumed from share exchange agreement  36,613    
        
NET CASH USED IN INVESTING ACTIVITIES  670      (22,297)  36,613    
                    
CASH FLOW FROM FINANCING ACTIVITIES                    
Proceeds on sale of common stock     25,000   150,500 
Proceed from issuance of convertible promissory note  22,026   38,500   337,266 
Proceeds from subscription receivable  22,800    
Proceeds from related parties        50,670   11,708   28,681 
                    
NET CASH PROVIDED BY FINANCING ACTIVITIES  22,026   63,500   538,436   34,508   28,681 
                    
NET INCREASE (DECREASE) IN CASH  (83,829)  (15,348)  2,077   57,052   (2,053)
                    
CASH, BEGINNING  85,906   21,674      3,856   254 
                    
CASH, ENDING $2,077  $6,326  $2,077  $60,908  $2,307 
                    
SUPPLEMENTAL CASH FLOW INFORMATION                    
            
Cash paid during the period for:                    
Interest $  $  $  $  $ 
Income taxes $  $  $  $  $ 
                    
Non-cash investing and financing activities                    
Promissory note issued for assets and business acquisition $       371,895  $  $ 
Common stock issued for service $  $4,430   4,430  $  $ 
Debt forgiveness of related party $  $  $54,742  $  $ 

 

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

NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION

 

The company (the “Company”, “we”, “us”, “our”, “FreeButton”)Company was incorporated on November 27, 2006 under the name “Secured Window Blinds, Inc.”, under the laws of the State of Nevada and extra-provincially registered under the laws of the Province of Ontario on February 2, 2007. On September 28, 2012, the Company with the approval of a majority of the shareholders and directors changed its name from Secured Window Blinds, Inc. to FreeButton,Freebutton, Inc.

 

FreeButtonFreebutton, Inc. is now a product development and marketing company catering to the electronic vapour cigarette and accessories industry.

On August 14, 2014, the Company entered into a Share Exchange Agreement (the ‘Share Exchange Agreement”) which resulted in a Reverse Takeover with selling stockholders named in the prospectus, pursuant to which the Company offered and sold an aggregate of 21,000,000 shares of common stock to all the stockholders of A-1 Vapors,, Inc., a Florida corporation (“A-1 Vapors”), incorporated in the State of Florida, on April 26, 2012. The acquisition has ceasedbeen treated as a recapitalization of Freebutton, Inc. with A-1 Vapors, Inc. as the accounting acquirer in accordance with the Reverse Merger rules. As a result of the consummation of the Share Exchange Agreement A-1 Vapors became a wholly-owned subsidiary of the Company and the electronic cigarette business of offering window blind system products andA-1 Vapors is now operates sweepstakes websites featuring free giveawaysthe primary business of premier consumer products to users who participate in online games. The Company’s partner companies provide premier consumer products in various categories for free giveaway, such as sports, electronics, travel, gaming, style, bags, and in return, receive a series of benefits including product exposure, advertising space and sales leads. The Company also operates an ecommerce website where the users can purchase products of its partner companies.Company.

 

Going concern

To date the Company has generated no revenues from its business operations and has incurred operating losses since inception of $562,770.$483,594. As of March 31,at September 30, 2014, the Company hadhas a working capital deficit of $374,170.$385,687. The Company requires additional funding to meet its ongoing obligations and to fund anticipated operating losses. The ability of the Company to continue as a going concern is dependent on increasing sales and raising capital to fund its initial business plan and ultimately to attain profitable operations. Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern. The Company intends to continue to fund its business by way of private placements and advances from related parties as may be required. As of March 31, 2014 the Company had issued (i) 150,000,000 shares of its common stock to the Company’s founders at $0.0000667 per share for net proceeds of $10,000 to the Company, (ii) 9,300,000 shares of its common stock in private placement offerings at $0.001666 per share for net proceeds of $15,500, (iii) 100,000 shares of its common stock in private placement offerings at $0.25 per share for net proceeds of $25,000 to the Company and (iv) 500,000 shares of its common stock in private placement offerings at $0.25 per share for net proceeds of $125,000 to the Company. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

Unaudited Financial Statements

The accompanying unaudited financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for financial information and with the U.S. Securities and Exchange Commission (“SEC”) instructions to Form 10-Q. They do not include all information and footnotes required by GAAPUnited States generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended December 31, 2013 included in the Company’s Annual Report on Form 10-K filed with the SEC on April 15, 2014.Securities and Exchange Commission. The accompanying unaudited financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of the Company’s management,Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the threenine months ended March 31,September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014.

 

Segmented Reporting

Financial Accounting Standards Board (“FASB”FSAB”) Accounting StandardsStandard Codification (“ASC”) 280, Disclosure“Disclosure about Segments of an Enterprise and Related InformationInformation”, changed the way public companies report information about segments of their business in their quarterly reports issued to shareholders. It also requires entity-wide disclosures about the products and services the entity provides, the material countries in which it holds assets and reports revenues and its major customers.

 

Comprehensive Loss

FASB Statement Number 130, “Reporting Comprehensive Income,” establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As of March 31,at September 30, 2014, the Company hadhas no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.

 

Use of Estimates and Assumptions

Preparation of the financial statements in conformity with GAAPgenerally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Accordingly, actual results could differ from those estimates.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

 

Financial Instruments

All significant financial assets, financial liabilities and equity instruments of the Company are either recognized or disclosed in the financial statements together with other information relevant for making a reasonable assessment of future cash flows, interest rate risk and credit risk. Where practical the fair values of financial assets and financial liabilities have been determined and disclosed; otherwise only available information pertinent to fair value has been disclosed.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)Revenue Recognition

Fixed Assets

Fixed assetsIt is our policy that revenues are carried at cost less accumulated depreciation.  Depreciation is provided over their estimated useful lives, using the straight-line method. Estimated useful lives of the plant and equipment are as follows:

Office equipment5 years

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the statement of income. Accumulated depreciation to date on office equipment is $1,324.

Website Development Costs/Domain Names

The Company accounts for its development costsrecognized in accordance with FASB ASC-350-50, “Accounting for Website Development Costs.” The Company’s website comprises multiple features and offerings thatASC 605-10.  Under ASC 605-10, product revenues are currently developed with on-going refinements. In connection with the development of its products, the Company has incurred external costs for hardware, software, and consulting services, and internal costs for payroll and related expenses of its technology directly involved in the development. All hardware costs are capitalized as fixed assets. Purchased software will be capitalized in accordance with FASB ASC 350-50-25 related to accounting for the costs of computer software developed or obtained for internal use. All other costs are reviewed to determine whether they should be capitalized or expensed.

Pursuant to FASB ASC 360, “Property, Plant and Equipment”,the Company periodically evaluates, at least annually, whether facts or circumstances indicate that the carrying value of its depreciable assets to be held and used may not be recoverable. Domain names are generally not amortized. If such circumstances are determined to exist, an estimate of undiscounted future cash flows produced by the long-lived asset, or the appropriate grouping of assets, is compared to the carrying value to determine whether impairment exists. In the event that the carrying amount of long-lived assets exceeds the undiscounted future cash flows, then the carrying amount of such assets is adjusted to their fair value. The Company reports an impairment cost as a charge to operations at the time it is recognized.

Impairment of Long-Lived Assets

Long-lived assets, such as property and domain names and website development costs are reviewed for impairment when recoverability of assets to be held and used is measured by comparison of the carrying amountpersuasive evidence of an asset to estimated undiscounted future cash flows expecting an impairment chargearrangement exists, delivery has occurred, the sales price is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset.

Revenue Recognition

Revenue consists of commissions earned for the sale of magazine advertisement, on-line advertisementfixed and event sponsorship.determinable and collectability is reasonably assured. Revenue is recognized at the time the advertising becomes publicly available orpoint of sale for in person purchases and upon occurrence of the sponsored event.shipping for Internet sales.

 

Loss per Common Share

Basic earnings (loss) per share includes no dilution and is computed by dividing income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period. Dilutive earnings (loss) per share reflect the potential dilution of securities that could share in the earnings of the Company. Because the Company does not have any potential dilutive securities, the accompanying presentation is only on the basic loss per share.

 

Income Taxes

The Company follows the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances and tax loss carry-forwards. Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment.

 

Principles of consolidation

The Company consolidates its 100% owned subsidiary pursuant to Accounting Standards Codification (“ASC”) No. 810, “Consolidation”.  All intercompany transactions and balances have been eliminated.

Inventory

We value our inventories at the lower of cost, determined on a first-in, first-out method, or market value. Our inventory consists solely of finished goods. We review inventories on hand at least quarterly and record provisions for estimated excess, slow moving and obsolete inventory, as well as inventory with a carrying value in excess of net realizable value. The regular and systematic inventory valuation reviews include a current assessment of future product demand, historical experience and obsolete finished product.

Stock-based Compensation

The Company follows FASB ASC 718-10, Stock Compensation” (“ASC 718-10”)"Stock Compensation", which addresses the accounting for transactions in which an entity exchanges its equity instruments for goods or services, with a primary focus on transactions in which an entity obtains employee services in share-based payment transactions. ASC 718-10 is a revision to Statement of Financial Accounting Standards “SFAS”)SFAS No. 123, “Accounting"Accounting for Stock-Based Compensation," and supersedes Accounting Principles Board (“APB”("APB") Opinion No. 25, Accounting"Accounting for Stock Issued to Employees,,”" and its related implementation guidance. ASC 718-10 requires measurement of the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). Incremental compensation costs arising from subsequent modifications of awards after the grant date must be recognized. On February 25, 2013, the BoardNo stock-based compensation have been issued as of Directors of theSeptember 30, 2014.

Advertising Costs

The Company adopted a new equity incentive award plan, named the FreeButton, Inc. 2013 Equity Incentive Award Plan (the “2013 Plan”),accounts for advertising costs in accordance with provisions in ASC 720-35-25 which was approved by the holders of a majority, or approximately 65%, of the outstanding shares of the Company’s common stock on February 25, 2013. The 2013 Plan is an “omnibus plan” under which stock options, stock appreciation rights, performance share awards, restricted stock and restricted stock unitsstates that advertising costs can be awarded. 3,500,000 shares ofexpensed as incurred or the Company’s common stock are reserved for issuance underfirst time the 2013 Plan. The term of the 2013 Plan is 10 years from the date of its adoption. As of March 31, 2014, the Company has issued 7,000 shares of its common stock under the 2013 Plan.advertising takes place.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Recent Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

 

NOTE 3 – STOCKHOLDERS’ EQUITY/DEFICIT

 

The Company had sharesStockholders’ Equity/Deficit section of the Company contains the following classclasses of capital stock issued and outstandingCapital Stock as of March 31, 2014:

September 30, 2014.

-Common stock $0.001 par value: 75,000,000 shares authorized: 33,844,260 shares issued and outstanding.

 

On December 15, 2006, the Company issued 105,000,000August 14, 2014, 21,000,000 shares of its common stock at $0.0000666 per share to the sole member of the Company’s Board of Directors and President of the Company for cash proceeds of approximately $7,000.

On May 12, 2008, the Company issued 45,000,000 shares of its common stock at $0.0000666 per share to the sole member of the Company’s Board of Directors and President of the Company for cash proceeds of approximately $3,000.

From August to September, 2008, the Company issued 9,300,000 shares of its common stock through private placement offerings at $0.001666 per share for net proceedswere returned to the Company of approximately $15,500.

On June 26, 2012, the Presidentin anticipation of the Company forgave all debts owing to him by the Company for all advances/shareholders loans totalling $54,742. All these sums are reflected as a credit to additional-paid-in-capital.acquisition of A1 Vapors, Inc.

 

On August 15, 2012, two shareholders of14, 2014, the Company returned 126,000,000 (pre-split 8,400,000) restrictedentered into a Share Exchange Agreement (the “Share Exchange Agreement”) with selling stockholders named in the prospectus, pursuant to which the Company offered and sold an aggregate of 21,000,000 shares of common stock to all the Company’s treasurystockholders of A-1 Vapors, Inc., a Florida corporation (“A-1 Vapors”).

As a result of the Reverse Merger with A-1 Vapors, Inc. and theFreebutton, Inc. carried forward 12,844,260 commons shares, were cancelled by the Company.and subscription receivable representing 272,336 common shares valued at $342,231 in net liabilities assumed of Freebutton, Inc. prior to August 14, 2014. The shares were returned to the Company’s treasury for no consideration to the shareholders. Following the cancellation the Company now had 33,300,000 (pre-split 2,220,000 sharesnet liabilities consisted of common stock outstanding.$36,613 in cash, $24,749 in accrued liabilities and $354,095 in promissory notes and $24,749 in accrued liabilities.

 

On August 22, 2012 a majority of shareholders and the Company’s Board of Directors approved a special resolution to undertake a forward split of the common stock of14, 2014, the Company exchanging 15 newconverted $10,851 of debt in Subscription receivables to issue 72,336 common shares for 1 old share, which was effected on October 1, 2012, increasing the outstanding shares from 2,220,000 to 33,300,000.

On February 25, 2013, the Company issued 100,000 shares of its common stock through a private placement offeringdebt conversion agreement at $0.25$0.15 per share for net proceeds to the Company of $25,000.

On February 25, 2013 the Company issued a total of 7,000 shares of its common stock under the 2013 Plan to one individual and two companies in exchange for services provided by each recipient as an independent consultant to the Company. Total value received for services rendered was $4,430 (refer Equity Incentive Award Plan).

On July 11, 2013, the Company issued 100,000 shares of its common stock through a private placement offering at $0.25 per share for net proceeds to the Company of $25,000.share.

 

On September 16, 2013,25, 2014, the Company issued 300,000 shares of its common stock through a private placement offering at $0.25 per share for net proceedsreceived $22,800 in Subscription receivables to the Company of $75,000.

Private Placement Memorandum

On October 23, 2013, pursuant to a Private Placement Memorandum, the Company offered to raise a minimum of $550,000 to a maximum of $2,000,000 at $0.35 per share. The offering extended from October 23, 2013 to the close of business on December 31, 2013 unless the offering was extended at the Company’s sole discretion. Subsequently the offering was extended to February 28, 2014. There is no escrow of any of the proceeds of the offering, however the Company will not make use of the funds until a minimum of $550,000 (prior to commissions) or net $500,000 to the Company has been received. If the minimum is not met the Company will return funds to the investors.

NOTE 3 – STOCKHOLDERS’ EQUITY/DEFICIT (continued)

On November 14, 2013, the Company issued 100,000issue 152,000 common shares through a private placement offering at $0.35$0.15 per share for net proceedsshare.

Subsequent to the Company of $35,000.

On November 20, 2013,period on October 6, 2014, the Company received $36,750$$27,200 in subscriptionSubscription receivables to issue 105,000181,333 common shares of its common stock through a private placement offering at $0.35$0.15 per share.

On March 4, 2014, the Company not having met the minimum $500,000 net proceeds under the terms of the Private Placement Memorandum the Company returned the total funds of $71,750 to the investors. The 100,000 shares that had been issued were returned to the Company. The reversal of the transaction is reflected in the financial statements dated December 31, 2013.

All references in these financial statements to number of common shares, price per share and weighted average number of common shares outstanding prior to the 15:1 forward split have been adjusted to reflect the stock split on a retroactive basis, unless otherwise noted.

Equity Incentive Award Plan

On February 25, 2013, the Board of Directors of the Company adopted the 2013 Plan, which was approved by the holders of a majority, or approximately 65%, of the outstanding shares of the Company’s common stock on February 25, 2013.

The 2013 Plan is an “omnibus plan” under which stock options, stock appreciation rights, performance share awards, restricted stock and restricted stock units can be awarded. 3,500,000 shares of the Company’s common stock are reserved for issuance under the 2013 Plan. The term of the 2013 Plan is 10 years from the date of its adoption.

On February 25, 2013 the Company issued a total of 7,000 shares of its common stock under the 2013 Plan to one individual and two companies in exchange for services provided by each recipient as an independent consultant to the Company. Total value received for services rendered was $4,430.

 

NOTE 4 – RELATED PARTY TRANSACTIONS

 

On December 15, 2006The Company entered into the Company issued 105,000,000 shares of its common stock at $0.0000666 per share to the sole memberfollowing transactions with a related party:

As of the Company’s Board of Directors and President of the Company for cash proceeds of $7,000. On May 12, 2008 the Company issued 45,000,000 shares of its common stock at $0.0000666 per share to the sole member of the Company’s Board of Directors and President of the Company for cash proceeds of $3,000. During the nine monthsperiod ending September 30, 20122014, the PresidentCEO has advanced $38,358 and the COO has advanced $4,536 to the Company. The advances are unsecured, non-interest bearing and are payable on demand.

Management Contracts

On August 15, 2014 A-1 Group, Inc., (the “Company”) signed an initial two (2) year Employment Agreement with it Chief Executive Officer. The Company has agreed to a salary of the Company paid outstanding payables owed by the Company$3,500 per month starting September 1, 2014 and a lump sum signing bonus of $28,400. On June 26, 2012, the President of the Company forgave all debts owing to him by the Company for all advances/shareholders loans totalling $54,742. All these sums are reflected as a credit to additional-paid-in-capital.$10,000 due on August 29, 2014.

 

On August 15, 2012,2014 A-1 Group, Inc., (the “Company”) signed an initial two shareholders(2) year Employment Agreement with it Chief Operating Officer. The Company has agreed to a salary of the Company returned 126,000,000 (pre-split 8,400,000) restricted shares of common stock to the Company’s treasury and the shares were cancelled by the Company. The shares were returned to the Company’s treasury for no consideration to the shareholders. Following the cancellation the Company now had 33,300,000 (pre-split 2,220,000 shares of common stock outstanding.

On December 31, 2013 the Company repaid a shareholders loan in the amount of $4,072 owed to the President of the Company. The amounts due to the related party were unsecured and non- interest-bearing with no set terms of repayment.$3,500 per month starting September 1, 2014.

 

During the three-monthnine month period ended March 31,ending September 30, 2014, the Company paid $2,300accrued $17,000 in management fees.fees of which $3,500 had been paid as of September 30, 2014. The remaining outstanding balance of $13,500 was paid subsequent to the period in October 2014.

 

See Note 6 for further discussion of related party transactions.NOTE 5 – COMMITMENTS

The Company began leasing kiosk space in greater Miami in 2013 and run through 2015. At September 30, 2014, contractual obligations were as follows:

·Period beginning October 1, 2014 to December 31, 2014 - Rent Obligations - $27,327
·Period ending December 31, 2015 – Rent Obligations - $39,125

 

NOTE 56 – CONVERTIBLE PROMISSORY NOTE

On August 9, 2012 the Company signed a Convertible Promissory Note for $110,000, with an interest rate of 8% and a maturity date of August 9, 2013. The issuer of this Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory note into shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note). The conversion price per share is $0.10, unless the Company has, between the issuance date of this promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $1,000,000 at a price per share other than $0.10. This promissory note was included in the consolidation and extension of the Company’s promissory notes dated November 4, 2013, as further described below.

NOTE 5 – CONVERTIBLE PROMISSORY NOTE (continued)

On November 20, 2012, the Company signed a Convertible Promissory Note for $25,000, with an interest rate of 8% and a maturity date of May 20, 2013. The maturity date has been extended to November 20, 2013. The issuer of this Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory note into shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note). The conversion price per share is $0.10, unless the Company has, between the issuance date of this promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $225,000 at a price per share other than $0.10. This promissory note was included in the consolidation and extension of the Company’s promissory notes dated November 4, 2013, as further described below.

On December 13, 2012, the Company signed a Convertible Promissory Note for $10,000, with an interest rate of 8% and a maturity date of June 13, 2013. The maturity date has been extended to December 12, 2013. The issuer of this Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory note into shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note). The conversion price per share is $0.10, unless the Company has, between the issuance date of this promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $90,000 at a price per share other than $0.10. This promissory note was included in the consolidation and extension of the Company’s promissory notes dated November 4, 2013, as further described below.

On January 7, 2013, the Company signed a Convertible Promissory Note for $13,500, with an interest rate of 8% and a maturity date of October 3, 2013. The issuer of this Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory note into shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note). The conversion price per share is $0.10, unless the Company has, between the issuance date of this promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $121,500 at a price per share other than $0.10. This promissory note was included in the consolidation and extension of the Company’s promissory notes dated November 4, 2013, as further described below.

On March 18, 2013, the Company signed a Convertible Promissory Note for $25,000, with an interest rate of 8% and a maturity date of September 18, 2013. The issuer of this Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory note into shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note). The conversion price per share is $0.10, unless the Company has, between the issuance date of this promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $225,000 at a price per share other than $0.10. This promissory note was included in the consolidation and extension of the Company’s promissory notes dated November 4, 2013, as further described below.

On April 3, 2013, the Company signed a Convertible Promissory Note for $13,500, with an interest rate of 8% and a maturity date of October 2, 2013. The issuer of this Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory note into shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note). The conversion price per share is $0.10, unless the Company has, between the issuance date of this promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $121,500 at a price per share other than $0.10. This promissory note was included in the consolidation and extension of the Company’s promissory notes dated November 4, 2013, as further described below.

On April 25, 2013, the Company signed a Convertible Promissory Note for $25,000, with an interest rate of 8% and a maturity date of October 25, 2013. The issuer of this Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory note into shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note). The conversion price per share is $0.10, unless the Company has, between the issuance date of this promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $225,000 at a price per share other than $0.10. This promissory note was included in the consolidation and extension of the Company’s promissory notes dated November 4, 2013, as further described below.

On May 24, 2013, the Company signed a Convertible Promissory Note for $30,000, with an interest rate of 8% and a maturity date of November 24, 2013. The issuer of this Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory note into shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note). The conversion price per share is $0.10, unless the Company has, between the issuance date of this promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $270,000 at a price per share other than $0.10. This promissory note was included in the consolidation and extension of the Company’s promissory notes dated November 4, 2013, as further described below.

NOTE 5 – CONVERTIBLE PROMISSORY NOTE (continued)

On August 8, 2013, the Company signed a Convertible Promissory Note for $13,996.50, with an interest rate of 8% and a maturity date of February 14, 2014. The issuer of this Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory note into shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note). The conversion price per share is $0.10, unless the Company has, between the issuance date of this promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $125,964 at a price per share other than $0.10. This promissory note was included in the consolidation and extension of the Company’s promissory notes dated November 4, 2013, as further described below.

 

On October 23, 2013 the Company signed a Convertible Promissory Note for $10,000, with an interest rate of 8% andwith a maturity date of October 23, 2014. The issuer of thisthe Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory notePromissory Note into common shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note).Company. The conversionConversion price per share iswould be $0.10, unless the Company has, between the issuanceissue date of this promissory notethe Promissory Note and its maturityMaturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds inof an excess of $90,000 at a price per share other than $0.10.differing price.

 

On November 4,December 23, 2013 the Company signed a consolidation and extension of all the Company’s existing promissory notes and accrued interest as of October 31, 2013. The new total amount of the combined Promissory Note is $285,240.26 ($265,996.50 principal and $19,243.76 accrued interest) with an interest rate of 8% and a maturity date of February 9, 2014. The conversion price per share is $0.10, unless the Company has, between the issuance date of the combined promissory note and its maturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds in excess of $1,000,000 at a price per share other than $0.10. In the event the Company does not pay the outstanding balance by February 9, 2014, the interest rate of the combined promissory note will increase to 12% per annum.

On February 28, 2014, the Company signed a Convertible Promissory Note for $22,026,$20,000, with an interest rate of 8% andwith a maturity date of August 28,December 23, 2014. The issuer of thisthe Convertible Promissory Note has the option to convert all or portion of the amount due under the promissory notePromissory Note into common shares of the common stock of the Company, contingent upon the occurrence of an “Event of Default” (as defined in the promissory note).Company. The conversionConversion price per share iswould be $0.10, unless the Company has, between the issuanceissue date of this promissory notethe Promissory Note and its maturityMaturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds inof an excess of $198,234$180,000 at a price per share other than $0.10.differing price.

NOTE 6 – CONVERTIBLE PROMISSORY NOTE (continued)

 

On March 11, 2014 the Company signed a consolidated and extension of the Company’s existing promissory notes.Promissory Notes. The newNew total amount of the combined Promissory Note is $307,266.26 (promissory note in the principal amount of $285,240.26 dated November 4, 2013 and promissory note in the principal amount of $22,026 dated February 28, 2014)$307,266 with an interest rate of 8% and maturity date of August 28, 2014. The conversionConversion price per share iswould be $0.10, unless the Company has, between the issuanceissue date of the combined promissory notePromissory Note and its maturityMaturity date, sold shares of its capital stock in any financing in which the Company received gross proceeds inof an excess of $1,000,000 at a price per share other than $0.10.differing price. In the event the Company does not pay the outstanding balance by August 28, 2014, the interest rate of the Promissory Note will increaseincreases to 12% per annum. The promissory note is in default and the 12% interest rate is in effect.

On June 20, 2014 the Company signed a Convertible Promissory Note for $16,828, with an interest rate of 8% with a maturity date of December 20, 2014. The issuer of the Convertible Promissory Note has the option to convert all or portion of the Promissory Note into common shares of the Company. The Conversion price share would be $0.10, unless the Company has, between the issue date of the Promissory Note and its Maturity date, sold its capital stock in financing in which the Company received gross proceeds of an excess of $152,000 at a differing price.

 

The conversion of the promissory notesPromissory Note(s) is contingent upon an “Event Default” and the promissory notes arePromissory Note is not currently convertible as none of the promissory notes are currently in default.convertible. If the promissory notes doPromissory Note does become convertible the non-cash expense to the Company is dependent on the trading value of the Company’s stock on the day of conversion and the $0.10 conversion price. The estimated non-cash expense if the promissory notePromissory notes had bebeen converted as of March 31,September 30, 2014 would have been $1,782,144.$678,735.

 

NOTE 67 – ASSET AND BUSINESS ACQUISITION

 

A1 Vapors, Inc. – Share Exchange Agreement

On July 11, 2013, the CompanyAugust 14, 2014 FreeButton entered into an Assets and Business Acquisition Agreementexchange agreement (the “Acquisition“Exchange Agreement”) with Media Rhythm Group,A1 Vapors, Inc. (“Media Rhythm”) to acquireUnder the terms of the Exchange Agreement, the shareholders of A1 Vapors, Inc. received 21,000,000 newly-issued shares of FreeButton’s Common Stock in exchange for all of the assets used in connection with the businessA1 Vapor’s outstanding Common Stock. A1 Vapors, Inc. has become a wholly-owned subsidiary of Media Rhythm (the “Assets”). Media Rhythm operatesFreeButton. The acquisition has been treated as a marketing and advertising business that primarily caters to sports media such as magazines and websites. James Lynch, President, Chief Executive Officer, Secretary, and sole Directorrecapitalization of the Company is President andwith Al Vapors as the sole shareholder of Media Rhythm.

Pursuant to the Acquisition Agreement, the Company purchased the Assets for $420,000 (the “Purchase Price”), andaccounting acquirer in return, issued a promissory note dated July 11, 2013 to Media Rhythmaccordance with the principal amount equal to the Purchase Price (the “Note”). Under the Note, the Purchase Price shall be paid by the Company to Media Rhythm in twenty-four (24) equal monthly instalments commencing on August 1, 2013 (on August 2, 2013 the commencement date was changed to September 1, 2013). The present value of the $420,000 principal balance of the Note is $371,895. The Note shall not bear interest. The Company may at any time prepay all or part of the unpaid principal balance of the Note. The Company’s payment obligation may become accelerated upon certain events of default, including failure to make past due payment within ten (10) days of a written notice from the holder, failure to cure any involuntary insolvency or bankruptcy proceeding within ninety (90) days of the commencement of such proceeding, and filing of any voluntary bankruptcy or insolvency proceeding. Media Rhythm is entitled to a right of setoff against all or part of the unpaid and past due payments under the Note or the Acquisition Agreement.

On March 5, 2014, the Company and Media Rhythm entered into an Asset Purchase Agreement (the “Agreement”), whereby the Company sold, transferred and assigned to Media Rhythm all of the assets, rights and interests owned by the Company related to its marketing and advertising business that primarily caters to sports media such as magazines and websites, including all business names, trade names, logos, copyrights, trademarks and other intellectual property related thereto (the “Assets”). In consideration of the Company’s sale of the Assets, Media Rhythm executed and delivered to the Company a Cancellation and Termination of Promissory Note (the “Note Cancellation”), thereby relieving the Company of all obligations pursuant to the Promissory Note issued by the Company on July 11, 2013 in the principal amount of $420,000, as described above. The reversal of the transaction is reflected in the financial statements dated December 31, 2013.

NOTE 7 – DISCONTINUED OPERATIONS

On March 5, 2014, the Company and Media Rhythm entered into the Agreement, whereby the Company sold, transferred and assigned to Media Rhythm all of the Assets. In consideration of the Company’s sale of the Assets, Media Rhythm executed and delivered to the Company the Note Cancellation, thereby relieving the Company of all obligations pursuant to the Promissory Note issued by the Company on July 11, 2013 in the principal amount of $420,000, as described above. The reversal of the transaction is reflected in the financial statements dated December 31, 2013. (Refer Note 6).

Reverse Merger rules. As a result of the reversalproposed consummation of the Asset and Business AcquisitionShare Exchange Agreement there wasA1 Vapors, Inc. will become a net gain to FreeButtonwholly-owned subsidiary of $3,818.

NOTE 8 – DISTRIBUTION AGREEMENT

On October 22, 2013, FreeButton, Inc. (the “Company”) entered into an Exclusive Distribution Agreement (the “Distribution Agreement”) with Rivalfly National Network, LLC (“Rivalfly”), whereby the Company granted exclusive distribution rights to Rivalfly for its game platform for an initial term of five (5) years. The Company expectations are that the agreement will be concluded by end of first quarter of 2014.

Under the terms of the Distribution Agreement, Rivalfly was to be issued up to 25,512,500 shares (the “Maximum Issuance”) of the Company’s Common Stock (the “Shares”), issuable in increments upon the Company achieving certain milestones as more fully set forth in the Distribution Agreement. More specifically, Rivalfly was to be issued: (i) 4,000,000 Shares upon securing a sub-distribution agreement with Game Exchange of Colorado, Inc.; (ii) 4,000,000 Shares upon the Company’s completion of a successful test phase for its game platform; and (iii) 1,000,000 Shares for every 1,000 paying customers sourced by Rivalfly. The Share issuances were dependent in large part on the Company’s success in raising capital from investors to develop and commercialize its game platform. The Share issuances were not dependent or conditioned on Rivalfly’s efforts to raise capital on behalf of the Company.

Under the terms of the Distribution Agreement, upon the issuance of 4,000,000 Shares to Rivalfly, Rivalfly was going to be entitled to appoint one (1) representative to the Company’s Board of Directors and maintain that representative until the time Rivalfly no longer owned at least 2,000,000 Shares or upon termination of the Distribution Agreement.

Under the terms of the Distribution Agreement, in the event of a change in control transaction resulting in net proceeds to the Company of at least $50,000,000, the Maximum Issuance would have been deemed fully-earned and issuable.

On February 7, 2014, the Distribution Agreement between Rivalfly and the Company and the related Stock Purchase Agreement, was terminated pursuant to that certain Cancellation and Termination of Stock Purchase Agreement and Exclusive Distribution Agreement entered into betweenelectronic vapour cigarette industry will become the Company and Rivalfly. Following the terminationprimary business of the Distribution Agreement, neither party has any obligations under the Distribution Agreement. company.

 

NOTE 98 – SUBSEQUENT EVENTS

 

On April 11,Subsequent to the period on October 6, 2014, the Company entered intoreceived $$27,200 in Subscription receivables to issue 181,333 common shares through a Binding Letter of Intent (“LOI”) to acquire A1 Vapors, Inc. a product development and marketing firm catering to the electronic vapour cigarette industry. Under the terms of the LOI the Company will purchase all of the issued and outstanding capital stock of A1 pursuant to a definitive agreement to be entered into between the parties. Consideration for the purchase will be approximately 21 million restricted shares of the Company’s common stock. The closing date is expected to be on or before May 31, 2014.private placement at $0.15 per share.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operation

 

This Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to provide a reader of FreeButton, Inc.’s (the “Company”, “FreeButton, “we”, “us” and “our”) financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity, and certain other factors that may affect our future results. The following discussion and analysis should be read in conjunction with our consolidated financial statements and the accompanying notes thereto included in “Item 1. Financial Statements.” In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. See “Forward-Looking Statements.” Our results and the timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of many factors.

 

Business Overview

We operateare an electronic cigarette company with Internet sales and kiosk locations in the greater Miami area through our fully owned subsidiary A1 Vapors, Inc. A1 Vapors is a product development and marketing company catering to the electronic vapor cigarette and accessories industry. A1 Vapors offers a variety of options to choose from to appeal to all smokers including a diverse selection of devices and flavors.

“Electronic cigarettes” or “e-cigarettes” and “vaporizers” are battery-powered products that enable users to inhale nicotine vapor without smoke, tar, ash, or carbon monoxide. Electronic cigarettes look like traditional cigarettes and, regardless of their construction are comprised of three functional components:

·A mouthpiece, which is a small plastic cartridge that contains a liquid nicotine solution;
·The heating element that vaporizes the liquid nicotine so that it can be inhaled; and
·The electronics, which include: a lithium-ion battery, an airflow sensor, a microchip controller and an LED which illuminates to indicate use.

When a user draws air through the electronic cigarette and or vaporizer, the air flow is detected by a sensor, which activates a heating element that vaporizes the solution stored in the mouthpiece/cartridge, the solution is then vaporized and it is this vapor that is inhaled by the user. The cartridge contains either a nicotine solution or a nicotine free solution, either which may be flavored.

The Company was engaged in the business of operating sweepstakes websites featuring free giveaways of premier consumer products to users who participateparticipated in online games. Our partner companies provide premier consumer products in various categories for free giveaway, such as sports, electronics, travel, gaming, style, bags, and in return, receive a series of benefits including product exposure, advertising space and sales leads. We also operate an ecommerce website wherePrior to this the users can purchase products of our partner companies.

The Company was engaged in the business of offering window blind system products and ceased such operation upon the consummation of a change of control of the Company in August 2012. Since August 2012, and until mid-August 2014, management had been building the Company to be a platform for marketing and advertising initiatives and a marketplace for consumer products. On August 14, 2014 the Company entered into a Share Exchange Agreement with A-1 Vapors, Inc. as reported in our Current Report on Form 8-K filed with the Securities and Exchange Commission (“SEC”) on August 3, 201222, 2014 (the “August 20122014 Form 8-K”). Since August 2012, current management has been buildingThe Company is now involve in the electronic cigarette retail market.

As soon as practicable the Company will file an Amendment to be a platform for marketingthe Articles of Incorporation requesting the state of Nevada and advertising initiativesFINRA change its name from “FreeButton, Inc.” to the new name “A1 Group, Inc.” All of the Company’s filings will reflect the new name when the process is completed with the state and a marketplace for consumer products.federal agencies.

 

Recent Development

On July 11, 2013, weMay 23, 2014, FreeButton, Inc. entered into an Assets and Business AcquisitionExchange Agreement (the “Acquisition Agreement”) with Media Rhythm Group,A-1 Vapors, Inc. (“Media Rhythm”), to acquire all of the assets used in connection with the business of Media Rhythm (the “Assets”).

Media Rhythm operates a marketing and advertising business that primarily caters to sports media such as magazines and websites. James Lynch, President, Chief Executive Officer, Secretary, and Director of the Company, is President and the sole shareholder of Media Rhythm.

Pursuant to the Acquisition Agreement, the Company purchased the Assets for $420,000 (the “Purchase Price”), and in return, issued a promissory note dated July 11, 2013 to Media Rhythm with the principal amount equal to the Purchase Price (the “Note”). Under the Note, the Purchase Price shall be paidA-1 Vapors. The transaction contemplated by the Company to Media Rhythm in twenty-four (24) equal monthly installments commencingExchange Agreement was consummated on August 1, 2013(on August 2, 2013 the commencement date was changed to September 1, 2013). The Note shall not bear interest. The Company may at any time prepay all or part of the unpaid principal balance of the Note.

On August 1, 2013, the company filed a Current Report on Form 8-K with the SEC announcing the completion of the acquisition of the Assets of Media Rhythm.

14, 2014. As previously reported in our Current Report on FormFrom 8-K filed with the SEC on March 28, 2014, on March 5,August 22, 2014, the Company and Media Rhythm entered into an Asset Purchase Agreement (the “Agreement”), whereby the Company sold, transferred and assigned to Media Rhythm all of the assets, rights and interests owned by the Company related to its marketing and advertising business that primarily caters to sports media such as magazines and websites, including all business names, trade names, logos, copyrights, trademarks and other intellectual property related thereto (the “Assets”). In consideration of the Company’s sale of the Assets, Media Rhythm executed and delivered to the Company a Cancellation and Termination of Promissory Note (the “Note Cancellation”), thereby relieving the Company of all obligations pursuant to the Promissory Note issued by the Company on July 11, 2013 in the principal amount of $420,000, as described above.

The foregoing description of the disposition of the Assets does not purport to be complete and is qualified in its entirety by reference to the full text of the Note Cancellation, a copy of which is filed as Exhibit 10.1 to this Quarterly Report on Form 10-Q and incorporated herein by reference.

On August 29, 2013, we entered into a LetterShare Exchange Agreement (the ‘Share Exchange Agreement”) which resulted in a Reverse Takeover with selling stockholders named in the prospectus, pursuant to which the Company offered and sold an aggregate of Intent21,000,000 shares of common stock to acquire Rivalfly National Network, an Illinois limited liability companyall the stockholders of A-1 Vapors,, Inc., a Florida corporation (“Rivalfly”A-1 Vapors”)., incorporated in the State of Florida, on April 26, 2012. The acquisition has been treated as a recapitalization of Freebutton, Inc. with A-1 Vapors, Inc. as the accounting acquirer in accordance with the Reverse Merger rules. As a result of the consummation of the Share Exchange Agreement A-1 Vapors became a wholly-owned subsidiary of the Company and the electronic cigarette business of A-1 Vapors is now the primary business of the Company.

 

Rivalfly has more than 30 combined years’ experienceA-1 Vapors, Inc., a product development and marketing company catering to the electronic cigarette and accessory industry, with internet sales and multiple kiosk retail locations in the distributionMiami area. Bruce Storrs, Chairman, Chief Executive Officer, Director and Andy Diaz Chief Operating Officer, Director of goods and services to over 50,000 retail locations nationwide. Rivalfly’s distribution contacts provide the Company, with national reach for its B2C & B2B gamification platforms toand are the sole shareholders’ of A1 Vapors, Inc.

As a local level to businessesresult of the Share Exchange Agreement, Bruce Storrs and consumers.Andy Diaz became the majority shareholders and became the principal officers and directors of the Company.

 

As reported in our Current Report on Form 8-K filed with the SEC on October 25, 2013 (the “October Form 8-K”), on October 22, 2013, the Company entered into an Exclusive Distribution Agreement (the “Distribution Agreement”) with Rivalfly National Network, LLC (“Rivalfly”), whereby the Company granted exclusive distribution rights to Rivalfly for its game platform for an initial term of five (5) years. Additionally, as reported in the October Form 8-K, under the terms of the Distribution Agreement, Rivalfly was to be issued up to 25,512,500 shares (the “Maximum Issuance”) of the Company’s common stock (the “Shares”), issuable in increments upon the Company achieving certain milestones as more fully set forth in the Distribution Agreement. More specifically, Rivalfly was to be issued: (i) 4,000,000 Shares upon securing a subdistribution agreement with Game Exchange of Colorado, Inc.; (ii) 4,000,000 Shares upon the Company’s completion of a successful test phase for its game platform; and (iii) 1,000,000 Shares for every 1,000 paying customers sourced by Rivalfly.

On February 7, 2014, the Distribution Agreement between Rivalfly and FreeButton, and the related Stock Purchase Agreement, was terminated pursuant to that certain Cancellation and Termination of Stock Purchase Agreement and Exclusive Distribution Agreement entered into between the Company and Rivalfly (the “Termination Agreement”). Following the termination of the Distribution Agreement, neither party has any obligations under the Distribution Agreement.

The foregoing description of the termination of the Distribution Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Termination Agreement, a copy of which is filed as Exhibit 10.2 to this Quarterly Report on Form 10-Q and incorporated herein by reference

As reported in our Current Report on Form 8-K filedfile with the SEC on May 14, 2014, on April 11, 2014 the Company entered into a Binding Letter of Intent (“LOI”) to acquire A1 Vapors, Inc. a product development and marketing firm catering to the electronic vapour cigarette industry. Under the terms of the LOI the Company will purchase all of the issued and outstanding capital stock of A1 pursuant to a definitive agreement to be entered into between the parties. Consideration for the purchase will be approximately 21 million restricted shares of the Company’s common stock. As reported in our Current Report on Form 8-k filed on May 27, 2014, on May 23, 2014 FreeButton entered into an exchange agreement (the “Exchange Agreement”) with A1 Vapors. Under the terms of the Exchange Agreement, the shareholders of A1 Vapors will receive 21,000,000 newly-issued shares of FreeButton’s Common Stock in exchange for all of A1 Vapor’s outstanding Common Stock. Upon completion of the proposed transaction, A1 will become a wholly-owned subsidiary of FreeButton. The closing date is expected to be on or before May 31,the end of the third quarter in 2014. The foregoing description of the LOI does not purport to be complete and is qualified in its entirety by reference to the full text of the LOI, a copy of which is filed as Exhibit 10.3 to this Quarterly Report on Form 10-Q and incorporated herein by reference. The foregoing description of the Exchange Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the LOI, a copy of which is filed as Exhibit 10.4 to this Quarterly Report on Form 10-Q and incorporated herein by reference.

 

Plan of Operations

 

PriorOur Plan is to become a leading retailer of electronic cigarette and vapor related products in the North American market. We intend to accomplish that objective through competing on price and quality, expanding our presence at physical locations, expanding distribution points and expanding our online presence.

The brands that we select to sell in addition to the period covered byA-1 Vapors, white-label brand, are selected on their general popularity with our target consumer base. We believe that this Quarterly Report on Form 10-Q, we launched onestrategy will enable us to continue to offer “best-in-class” products which have the potential to increase our sales the most, while avoiding risk of product VideoStakes.development and manufacturing. Our ability to negotiate reasonable pricing with these manufactures is also a contributing factor to selection.

 

VideoStakesWe will continue to seek out and identify new products to introduce to our consumer base which we believe will increase our revenue per person and generate greater repeat business such as starter kits, a variety of batteries and new flavors to our line of e-liquid.

 

VideoStakes, launched October 23,Comparison of the Three Month and Nine Month Periods Ended September 30, 2014 and 2013 is the Company’s B2B Video Engagement and Social Sharing platform. The platform incentivizes Internet users to engage in brand video content pieces and share them through social networks. It enables brands to leverage existing advertising campaigns and drive traffic to target online destinations where users engage in entertain media and content earning a chance to win a prize or giveaway. Additionally, the user is incentivized to share the giveaway and media content via their personal social media networks for numerous additional entries into the same giveaway.

VideoStakes will be used by brands on a monthly basis via a fee service.

 

Our President, Chief Executive Officer and Secretary, James Lynch, builds partnerships with consumer products manufacturers, drives sales, perform other functionsnet loss for the three months ended September 30, 2014 was $27,440 compared to net income of an executive, managerial or administrative nature.

Our Vice President and Treasury, Dallas Steinberger, is responsible for our website construction and assist with marketing and generating traffic to our websites.

Results of Operation

Three Months Ended March 31, 2014 Compared to Three Months Ended March 31, 2013

We did not generate any revenue$17,636 during the quartersame period from the prior fiscal year. During the three month period ended March 31,September 30, 2014 we generated $71,765 in revenue and have not generated any revenue since inceptionincurred, Cost of goods sold of $18,552, Selling, general and administrative expenses of $75,714, Loan interest of $10,639 and Gain on November 27, 2006. Total expenses for the quarter ended March 31, 2014 were $28,347 resulting in an operating lossdebt settlement of $28,347$5,700; as compared to total$71,538 in revenue, Cost of goods of $28,483 and Selling, general and administrative expenses of $88,227 resulting$25,419 and nil in an operating loss of $88,227Loan interest for the quarter ended March 31,same period in 2013. The decreaseincrease in total expenses relatesour Selling, general and administrative costs for the three months ended September 30, 2014 , compared to the executivesame period from the prior fiscal year was due to increase in audit, accounting , rent and management team electing to not take management fees as well as more efficiently managing professional fees and marketing expenses. The operating loss for the quarter ended March 31, 2014, is a result of office and general expenses in the amount of $8,172, management fees of $2,300, marketing expenses of $396 and professional fees in the amount of $17,479 compared to office and general expenses in the amount of $22,836, management fees of $33,000, marketing expenses of $10,567 and professional fees in the amount of $21,824 for the quarter ended March 31, 2013. The decrease in each of office and general expenses, management fees, marketing expenses and professional fees relates to the executive management team electing to not take management fees as well as more efficiently managing professional fees and marketing expenses. For the quarter ended March 31, 2014, we incurred a loan interest of $6,372 as compared to loan interest of $3,206 for the quarter ended March 31, 2013. The increase in loan interest relates to the commencement of our new business operations upon the consummation of a change of control of the Company which occurred in August 201214, 2014 as discussed above and as reported in the Form 8-K filed on August 201222, 2014.

Our net loss for the nine months ended September 30, 2014 was $43,096 compared to net income of $26,056 during the same period from the prior fiscal year. During the nine month period ended September 30, 2014 we generated $191,534 in revenue and incurred, Cost of goods sold of $62,460, Selling, general and administrative expenses of $170,631, Loan interest of $10,639, Other income of $3,400 and Gain on debt settlement of $5,700; as compared to $155,284 in revenue, Cost of goods of $78,842 and Selling, general and administrative expenses of $50,386 and nil in Loan interest for the same period in 2013. The increase in our Selling, general and administrative costs for the nine months ended September 30, 2014 , compared to the same period from the prior fiscal year was due to increase in audit, accounting , rent and management expenses. The increase in loan interest relates to the commencement of our new business operations upon the consummation of a change of control of the Company which occurred in August 14, 2014 as discussed above and as reported in the Form 8-K.8-K filed on August 22, 2014.

 

Capital Resources and Liquidity

 

As of March 31,September 30, 2014, we had $2,077$80,496 in assets comprised of $60,908 in cash, $4,193 in Deposits and $15,395 in Inventory as compared to $85,906$34,873 in assets comprised of $3,856 in cash, for the year ended$2,067 in accounts receivable, $ $4,193 in Deposits and $24,757 in Inventory as of December 31, 2013. We anticipate that201 As of September 30, 2014, our current cashtotal liabilities were $446,595 comprised of Accounts payable and cash equivalentsaccrued expenses of $49,606, Promissory Notes of $354,095 and cash generated from financing activities will be insufficientRelated party advances of $42,894 compared to satisfytotal liabilities of $32,746 as of December 31, 2013 comprised of Accounts payable and accrued expenses of $1,560, Promissory Note of $nil and Related part advances of $31,186. The increases assets and liabilities are to the commencement of our liquidity requirements fornew business operations upon the next 12 months. To dateconsummation of a change of control of the Company has generated no revenues from its business operationswhich occurred in August 14, 2014 as discussed above and has incurred operating losses since inception of $562,770. As of March 31, 2014,as reported in the Company has a working capital deficit of $374,170.Form 8-K filed on August 22, 2014.

 

The Company requires additional funding to meet its ongoing obligations and to fund anticipated operating losses. Our auditor has expressed substantial doubt about our ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on raising capital to fund its initial business plan and ultimately to attain profitable operations. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

 

We expect to incur product development, marketing and professional and administrative expenses as well expenses associated with maintaining our SEC filings, however, the we do not have any material capital expenditures planned at this time. We will require additional funds during this time and will seek to raise the necessary additional capital. If we are unable to obtain additional financing, we may be required to reduce the scope of our business development activities, which could harm our business plans, financial condition and operating results. Additional funding may not be available on favorable terms, if at all. The Company intends to continue to fund its business by way of equity or debt financing and advances from related parties.

 

If we raise additional capital through the issuance of equity or convertible debt securities, the percentage ownership of our Company held by existing shareholders will be reduced and those shareholders may experience significant dilution. In addition, new securities may contain certain rights, preferences or privileges that are senior to those of our common stock. In the event we are unsuccessful in raising additional capital through the issuance of equity or convertible debt securities, we will seek to raise additional capital through the issuance of debt or its equivalents. Issuance of debt or its equivalents will result in increased interest expense.

 

We are a development stage company with no revenues to date, and therefore we may have to pay high cost in securing a financing. We cannot assure you that we will be able to raise the working capital as needed in the future on terms acceptable to us, if at all. Any delay to raise capital as needed would have a material adverse effect on our business, financial condition and results of operations.

 

If we cannot raise additional fund, we will have to cease business operations. As a result, investors in the Company’s common stock would lose all of their investment.

 

Off Balance Sheet Arrangements

 

There are no off-balance sheet arrangements currently contemplated by management or in place that are reasonably likely to have future effect on the business, financial condition, revenue or expenses and/or result of operations.

 

Recent Accounting Pronouncements

 

We have implemented all new accounting pronouncements that are in effect and that may impact its financial statements. We do not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

 

ITEM 3. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK

 

Smaller reporting companies are not required to provide the information required by this item.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

We are responsible for maintaining disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Disclosure controls and procedures are controls and other procedures designed to ensure that the information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

 

Our management, including our principal executive officer and principal accounting officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act as of March 31,June 30, 2014, and concluded that the disclosure controls and procedures were not effective, because certain deficiencies involving internal controls constituted material weaknesses as discussed below. The material weaknesses identified did not result in the restatement of any previously reported financial statements or any other related financial disclosure, nor does management believe that it had any effect on the accuracy of our financial statements for the current reporting period.

 

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. As of March 31,September 30, 2014, the following material weaknesses existed:

 

·The Company does not have an independent audit committee in place, which would provide oversight of the Company’s officers, operations and financial reporting function;function.
·The Company’s disclosure controls and procedures do not provide adequate segregation of duties; and
·The Company does not have effective controls over period-end financial disclosure and reporting processes.

 

Management believes that the above material weaknesses could result in a material misstatement in our financial statements in future periods.

 

Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board of Directors.

 

We will continue to monitor and evaluate the effectiveness of our internal controls and procedures and our internal controls over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements when our financial position permits.

 

Changes in Internal Control Over Financial Reporting

 

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) or 15d-15(f)) during the quarternine month period ended March 31,September 30, 2014, that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

 

PART II. OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

To the best of our knowledge, there are no material pending legal proceedings to which we are a party or of which any of our property is the subject.

 

ITEM 1A. RISK FACTORS

 

Smaller reporting companies are not required to provide the information required by this item.

 

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

 

None.

Issuer Purchases of Equity Securities

 

Period(a)
Total number of shares (or units) purchased
(b)
Average price paid per share (or unit)
(c)
Total number of shares (or units) purchased as part of publicly announced plans or programs
(d)
Maximum number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programs
(a)
Total number
of shares (or units)
purchased
(b)
Average price
paid per share
(or unit)
(c)
Total number
of shares (or units)
purchased as part
of publicly announced
plans or programs
(d)
Maximum number
(or approximate dollar
value) of shares
(or units) that may
yet be purchased under
the plans or programs
January 1-31, 20140N/A0N/A
February 1-28, 2014100,000 (1)$0.25N/A100,000 (1)$0.25N/A
March 1-31, 20140N/A0N/A

April 1-30, 2014

0N/A

May 1 – 31, 2014

100,000 (1)$0.50N/A

June 1 – 30, 2014

0N/A
September 1-30, 2014224,336$0.15N/A
Total100,000$0.25N/A424,336$0.256N/A

 

(1) These shares were not repurchased in connection with a publicly-announced plan or program and were repurchased by the Company from various investors who previously purchased the shares from the Company in connection with a private purchase memorandum and debt conversion agreement as discussed in Note 3 to the accompanying financial statements.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES.

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

On April 11, 2014 the Company entered into the LOI to acquire A1 Vapors, Inc. a product development and marketing firm catering to the electronic vapour cigarette industry. Under the terms of the LOI the Company will purchase all of the issued and outstanding capital stock of A1 pursuant to a definitive agreement to be entered into between the parties. Consideration for the purchase will be approximately 21 million restricted shares of the Company’s common stock. As reported in our Current Report on Form 8-k filed on May 27, 2014, on May 23, 2014 FreeButton entered into an exchange agreement (the “Exchange Agreement”) with A1 Vapors. Under the terms of the Exchange Agreement, the shareholders of A1 Vapors will receive 21,000,000 newly-issued shares of FreeButton’s Common Stock in exchange for all of A1 Vapor’s outstanding Common Stock. Upon completion of the proposed transaction, A1 will become a wholly-owned subsidiary of FreeButton. The closing date is expected to be on or before May 31,September 30, 2014. The foregoing description of the LOI does not purport to be complete and is qualified in its entirety by reference to the full text of the LOI, a copy of which is filed as Exhibit 10.3 to this Quarterly Report on Form 10-Q and incorporated herein by reference. The foregoing description of the Exchange Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the LOI, a copy of which is filed as Exhibit 10.4 to this Quarterly Report on Form 10-Q and incorporated herein by reference.

The Exchange Agreement was consummated on August 14, 2014.

 

ITEM 6. EXHIBITS

 

3.1Articles of Incorporation of FreeButton, Inc. as filed with the Secretary of State of Nevada, incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1 filed on May 5, 2008.

3.2By-Laws of FreeButton, Inc., incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form S-1 filed on May 5, 2008.

3.3Corrected Amendment to Articles of Incorporation, incorporated by reference to Exhibit 3.1 to Current Report on Form 8-K filed on October 5, 2012.

4.13.4Form of Promissory Note, issued by the Company in favor of the holders thereof, , incorporated by reference to Exhibit 4.1 to AnnualCurrent Report on Form 10-K8-K filed on April 16, 2013.August 22, 2014, Material Definitive Agreement.

10.1(1)Asset Purchase Agreement between the Company and Media Rhythm Group, Inc. dated March 5, 2014.

10.2*Cancellation and Termination of Stock Purchase Agreement and Exclusive Distribution Agreement, dated February 7, 2014, by and between the Company andRivalfly National Network.

10.3*Binding Letter of Intent between the Company and A1 Vapors Inc. effective April 11, 2014.

10.4*Exchange Agreement between the Company and A1 Vapors Inc. effective May 23, 2014.
31.1*Certification of Principal Executive Officer and Principal Accounting Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1*+Certification of Principal Executive Officer and Principal Accounting Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.1*Temporary Hardship Exemption
101.INS**XBRL Instance Document
101.SCH**XBRL Taxonomy Extension Schema Document
101.CAL**XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF**XBRL Taxonomy Extension Definition Linkbase Document
101.LAB**XBRL Taxonomy Extension Label Linkbase Document
101.PRE**XBRL Taxonomy Extension Presentation Linkbase Document

 

+In accordance with the SEC Release 33-8238, deemed being furnished and not filed.

*Filed herewith

** Pursuant to Rule 406T of Regulation S-T, the interactive data files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

(1) Incorporated by reference to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on March 28, 2014.

 

SIGNATURES

 

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

 

 

 FreeButton, Inc.
  
Dated: May 19,December 16, 2014By:/s/ James Edward Lynch, Jr.Bruce Storrs
  

James Edward Lynch, Jr.

Bruce Storrs
President, Chief Executive Officer and Secretary

(Duly Authorized Officer, Principal Executive Officer and Principal Accounting Officer)

 

1918