Face Up Entertainment Group, Inc. - FORM 10-K

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EX-31 - CERTIFICATION - Face Up Entertainment Group, Inc.	fueg_ex31.htm
EX-32 - CERTIFICATION - Face Up Entertainment Group, Inc.	fueg_ex32.htm
EXCEL - IDEA: XBRL DOCUMENT - Face Up Entertainment Group, Inc.	Financial_Report.xls

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2012

Commission file number: 000-54415

FACE UP ENTERTAINMENT GROUP, INC.

(Exact name of registrant as specified in its charter)

Florida		27-1551007
(State of incorporation)		(I.R.S. Employer Identification No.)

20 East Sunrise Highway Suite 202, Valley Stream, New York 11581

(Address of principal executive offices)

(516) 303- 8100

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Exchange Act:

None

Securities registered pursuant to Section 12(g) of the Exchange Act:

Common Stock, $0.0001 par value

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

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 No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x

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

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	x
(Do not check if a smaller reporting company)

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

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of June 30, 2012. $3,551,250 based upon $0.15 per share.

As of April 12, 2013, 62,642,666 shares of the issuer’s common stock were issued and outstanding.

Documents Incorporated By Reference: None

TABLE OF CONTENTS

		Page
PART I

Item 1	Business		3
Item 1A	Risk Factors		9
Item IB	Unresolved Staff Comments		9
Item 2	Properties		9
Item 3	Legal Proceedings		9
Item 4	Mine Safety Disclosures		9

PART II

Item 5	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		10
Item 6	Selected Financial Data		12
Item 7	Management’s Discussion and Analysis of Financial Condition and Results of Operations		12
Item 7A	Quantitative and Qualitative Disclosures About Market Risk		14
Item 8	Financial Statements		14
Item 9	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure		14
Item 9A	Controls and Procedures		14
Item 9B	Other Information		16

PART III

Item 10	Directors, Executive Officers and Corporate Governance		17
Item 11	Executive Compensation		18
Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		20
Item 13	Certain Relationships and Related Transactions, and Director Independence		21
Item 14	Principal Accountant Fees and Services		22

PART IV

Item 15	Exhibits and Financial Statement Schedules		23

SIGNATURES			26

PART I

Item 1. Business.

As used in this Annual Report on Form 10-K (this “Report”), references to the “Company,” the “Registrant,” “we,” “our” or “us” refer to Face Up Entertainment Group, Inc., unless the context otherwise indicates.

Forward-Looking Statements

This Report contains forward-looking statements. For this purpose, any statements contained in this Report that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking information includes statements relating to future actions, prospective products, future performance or results of current or anticipated products, sales and marketing efforts, costs and expenses, interest rates, outcome of contingencies, financial condition, results of operations, liquidity, business strategies, cost savings, objectives of management, and other matters. You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as “may,” “will,” “should,” “expects,” “anticipates,” “contemplates,” “estimates,” “believes,” “plans,” “projected,” “predicts,” “potential,” or “continue” or the negative of these similar terms. The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking information to encourage companies to provide prospective information about themselves without fear of litigation so long as that information is identified as forward-looking and is accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those projected in the information.

These forward-looking statements are not guarantees of future performance and involve risks, uncertainties and assumptions that we cannot predict. In evaluating these forward-looking statements, you should consider various factors, including the following: (a) those risks and uncertainties related to general economic conditions, (b) whether we are able to manage our planned growth efficiently and operate profitable operations, (c) whether we are able to generate sufficient revenues or obtain financing to sustain and grow our operations, (d) whether we are able to successfully fulfill our primary requirements for cash, which are explained below under “Liquidity and Capital Resources”. We assume no obligation to update forward-looking statements, except as otherwise required under the applicable federal securities laws.

Corporate Background

Game Face Gaming, Inc., a Florida corporation (the “Company”) was incorporated on December 24, 2009 under the name Intake Communications, Inc. From inception up until February 10, 2011, the Company intended to provide software to companies to help them market and sell their music and entertainment content to consumers. While the Company had identified product requirements, product development had not started and the Company had not commenced business operations other than organizational, start-up, capital formation activities, filing its registration statement and meeting its obligations as an SEC reporting company.

On January 6, 2011, the Board of Directors and majority shareholder of the Company approved an amendment to the Company’s Articles of Incorporation (the “Amendment”) to (i) affect a 13 for 1 forward stock split of the Company’s issued and outstanding common stock in the form of a dividend, and (i) change the Company’s name from Intake Communications, Inc. to Game Face Gaming, Inc. The Amendment was filed on January 7, 2011 with the Secretary of State of the State of Florida and became effective as at the close of business on January 25, 2011. The forward stock split was distributed to all shareholders of record on January 24, 2011. No cash was paid or distributed as a result of the forward stock split and no fractional shares were issued. All fractional shares which would have otherwise been required to be issued as a result of the stock split were rounded up to the nearest whole share.

On February 10, 2011, Ron Warren, the principal shareholder and sole officer and director of the Company, entered into a Stock Purchase Agreement which provided for the sale of his 11,333,333 shares of common stock of the Company (the “Control Shares”) to Punim Chadoshos, LLC, a New York limited liability corporation (the “Buyer”). The consideration paid for the Control Shares, which at the time of such sale represented 40.57% of the issued and outstanding share capital of the Company on a fully-diluted basis, was $50,000. The Buyer, which is owned by a trust, used funds which it borrowed to purchase the Shares.

Simultaneously with such purchase and sale by the Buyer, Mr. Warren resigned from all his positions with the Company and Felix Elinson and Irving Bader were appointed to the Board of Directors of the Company, and Mr. Elinson was appointed President and Mr. Bader the Secretary. In addition, Mr. Warren canceled 104,666,667 shares of the Company previously owned by him and no longer owns any shares in the Company.

On February 22, 2011, the Company entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Lemberg Consulting, Inc., a New York corporation (the "Seller”) pursuant to which the Company acquired certain assets of the Seller in consideration for the issuance of 22,666,667 shares of its common stock. The assets purchased consist of a provisional patent and other intellectual property related to operating multi-platform, multiplayer non-wagering, non-games of chance, such as chess, poker, and backgammon. As a result of the transaction, the Company now owns the domain name www.FaceUpGaming.com.

The Asset Purchase Agreement contained customary representations and warranties from each of the Company and the Seller. The Company did not assume any liabilities in connection with the acquisition, other than the contractual payments due to Icreon Communications Ltd., a company located in India which provides development outsourcing as well as other platform related enhancement and support work. Icreon is to be paid as follows - (i) $25,000 when the platform completes Alpha testing; (ii) $27,500 after beta; and (iii) the remaining $27,500 after user acceptance testing. Icreon pursuant to the terms of this agreement has been paid in full. During the year ended December 31, 2011, the Company paid Icreon an additional $3,892 for other work performed.

In connection with the asset acquisition on February 22, 2011, Mr. Elinson became our Chief Executive Officer.

On March 1, 2011, the Company entered into a Poker License Agreement with Atlas Software USA Inc., a New Jersey corporation (“Atlas”) pursuant to which the Company granted Atlas the right to install and use Game Face Gaming software program for its own website and business. The Company retained all right, title and interest to its software. In consideration for the license, Atlas paid the Company $55,000, and will pay the Company (i) $27,500 upon acceptance of all design work, customization and the initiation of alpha testing that will support a minimum of 1,000 users; and (ii) $27,500 upon resolution of issues derived during the alpha testing and the completion of a beta test. It was anticipated that the alpha testing will be completed by April 15th and the completion of the beta by June 15th If payment is not made in accordance with the terms of the Agreement, the Company has the right to impose a 1% penalty per month on any overdue amount, and if not paid following 30 days notice, the Company may cancel the Agreement.

This Agreement was modified as of April 15, 2011 to extend the payments due by Atlas so that $27,500 is due 60 days after the completion of beta testing and the code moved to production servers of an online poker room membership model and the final payment in the amount of $27,500 will be due 60 days later. The Company anticipates to provide Atlas with a redesigned membership model platform as compared to a rake model by June 2013.

On March 3, 2011, the Company entered into a similar license agreement with Prodigious Capital Group LLC on the same terms and conditions as the agreement with Atlas, other than the payment of $50,000 to the Company upon execution and delivery of the agreement and $25,000 due and payable upon acceptance of all design work, customization and the initiation of alpha testing that will support a minimum of 1,000 users which is expected July 1st; and (ii) $25,000 upon resolution of issues derived during the alpha testing and the completion of a beta test, which is expected September 1st. This license is limited to the "Texas Hold-em" version of the software of the Company and no other games or poker variations.

This Agreement was modified as of April 15, 2011 to extend the payments due by Prodigious so that $27,500 will become immediately due 60 days after the completion of beta testing and the code moved to production server/s. A final payment in the amount of $27,500 will be due 60 days later. The Company anticipates to provide Atlas with a redesigned membership model platform as compared to a rake model by June 2013.

Business Overview

Since the change of control and the consummation of the transactions contemplated by the Asset Purchase Agreement, we are now in the business of operating a reality gaming social network. We offer a non-wagering internet poker website and by incorporating proprietary technologies that provides players with streaming video, audio and messaging capabilities. We believe that these enhancements will dramatically enhance the players’ online social gaming experiences. Management is not aware of any online games sites which offer players the ability to see one another and speak live during game play.

We are committed to responsible game-play and are not a gambling site - we want to encourage people to play competitively to win prizes without requiring them to risk losing money. The only cost to players is a monthly membership fee. Because we do not offer gambling, players cannot lose money, but still provide an exciting and entertaining experience. Our members pay us a monthly fee, which gives them a certain amount of points. These points are then used to enter tournaments and/or play games on the site. Each game has its own entry fee in terms of points. Additional points are not purchased; instead they are won based on a member's standing in various tournaments played on our site.

We will require additional capital to develop and expand our gaming platform to a full launch. We estimate that within the next 12 months we will need approximately $3,600,000 in net operating funds to operate our subscription based site and market the site to obtain members and generate revenues from members. We anticipate that such funds, were they to be available to the Company, would be utilized as follows: 1-Accounts Payable $ 400,000; 2- Notes Payable $1,000,000; 3- Operations $800,000; 4- Marketing $1,100,000; 5- Development- $300,000.

There can be no assurance that additional capital will be available to us. We currently have no agreements, arrangements or understandings with any person to obtain such amount of funds through bank loans, lines of credit or any other sources. Since we have no other such arrangements or plans currently in effect, our inability to raise funds for the above purposes will have a severe negative impact on our ability to remain a viable company.

Our Technology

We currently own provisional patent application number 61/423,751, titled "reality gaming social network".

Our software is designed in ASP.Net 2 and Flash, and the database is built in MS SQL and Flash Media Server. Utilizing this approach, we hope to provide video streaming and voice quality capabilities to more than 1 million players at one time. Because our infrastructure exists on cloud based technology, our platform enables rapid and immediate response to higher demand.

Cloud computing is by far the most economical way to scale up capacity, because as the need presents itself all we need to do is open up a new server and access the required server. This method not only enables us to determine the exact configuration and bandwidth which we need to use, but then we only have to pay for what we need and use.

We are currently using cloud computing provided by Rackspace.com on a monthly basis Rackspace offers data centers which simultaneously handle the resource requests from multiple clients. With everything in the data centers, we do not need to have our own information technology setup related directly to the constant upkeep of servers. We currently pay $3200-$3600 per month depending on bandwidth usage for this service. Our gaming systems have been designed to meet the most demanding security standards. We use the same technology currently employed by Amazon and Dell to secure their e-commerce sites' client information. All sensitive data will be securely transmitted and stored in encrypted databases with Rackspace.com.

We also believe that the use of ASP.Net in the front-end makes our system fully secure and encrypted from hackers because the software is running from the server instead of being downloaded to a player’s computer. This design makes the system more secure and provides less chances of the system slowing down and/or crashing.

Products

Our first game offering is poker. Poker was selected as the Company’s inaugural game product because our platform and technology (live, interactive video and chat) will enable players to see and speak to each other in real-time. Our technology will allow play not merely based on the cards being held in hand but also using the skill required to see and read the opponent’s face; the proverbial ‘poker face’.

We offer people the opportunity to participate in tournaments, which are the ultimate poker players' thrill. A tournament is a poker game in which each player starts with an equal amount of chips. All of the players in the tournament continue to play until one player has amassed all of the chips. Each tournament has a chip-buy-in. The buy-in is put into the prize pool; the fee is kept by the Company. The size of the prize pool depends on the tournament structure and is paid out in its entirety to the winner.

To start the tournament, each player is dealt a card. The player with the highest card starts the game as the dealer. Each player's goal is to amass as many chips as possible. Players who lose all of their chips are out of the tournament. As the tournament continues, more and more players are eliminated until only the tournament winner remains.

Members will be given a tournament rating that is a measure of how successful they are in our tournaments. The tournament rating is a score that is based on a player’s multi-table tournament performance and is constantly changing as the player plays more multi-table tournaments. Tournament ratings allow a player to see how he is doing and track his progress as he becomes a better player. We also hope to run special tournaments in which a player can play against players with similar tournament ratings. This will allow players the opportunity to play against other players of similar skill level.

The numerical value of a player’s tournament rating is determined by a complex formula that takes into account primarily where the player is placed in a given multi table tournament and how many total people were in the tournament. The player’s tournament rating then determines his color level, which starts at the Red level and progress to Green and finally to Black -- the highest color level. The more multi table tournaments he plays, the size of the tournaments and how he places in these tournaments will determine whether the player’s score and color level move up or down. In general, the better the player’s performance, the higher his numerical tournament rating score.

If we are successful and can raise sufficient funds, we hope to offer other types of tournaments, including:

Shootouts: A shootout is a special kind of multi-table tournament. Traditionally, when a player plays in a multi-table tournament, players are moved from table to table to balance the number of players at each table. Eventually, the fortunate last nine players end up at the "final table". In a shootout, no such table balancing is done. A player remains at his original table until only one player is left standing. If he wins at that table, he advances to another table and repeats the process against other players who have each won at previous respective tables.

Double Shootout: In a Double Shootout, a player needs to win two tables to win the event, although often there is some money for everybody who makes the second table. Each starting table is played to its conclusion; the final table is formed of the winners of the first round matches.

Triple Shootout: In a Triple Shootout, a player must win three tables to win the entire event (again, there may well be some prize money distributed along the way). For example, assuming a standard (9 players per table) triple shootout is full, 729 players will be placed, 9 per table, at 81 tables within the tournament. Each table will play until there is one player remaining with all of the chips from that table. The 81 players remaining will then be moved to 9 tables for Round 2. As in Round 1, each table will play until one player has all of the chips from that table. Finally, the 9 remaining players will advance to the final table, where the champion of the tournament will be determined.

This process could be extended to quadruple shootouts and on up. Also, the tables don't necessarily have to start at nine players each. For instance, it is possible to run a triple shootout with four-player tables (a total of 64 players in each event).

Satellite: A satellite is a tournament in which the prize is an entry into a larger tournament. It can be less expensive to enter a satellite than it would be to enter the main tournament directly. Multi-table satellites are scheduled as regular tournaments, and the sign-up details and play are identical.

Freerolls: A "freeroll" is another type of tournament in which entry is completely free. There is no buy-in and no entry fee, but there are cash prizes available to win. We hope to hold many of these events on a daily basis.

Sit & Go: A "Sit & Go" is a tournament that is not regularly scheduled; it simply begins when all the seats are filled. We hope to offer several kinds of Sit & Go tournaments, including single table, multi table, and heads up events.

We hope to quickly expand the network beyond poker to include global staples in gaming such as backgammon, chess and checkers.

Market

Management has studied the state of multi-platform, multiplayer non-wagering, non-games. We feel that the gaming industry presents an ever increasing market and excellent opportunities for growth. The Company hopes to market the first online gaming product which will deliver video, audio and texting functionality along with the ability to allow users to create their own private tables and host their own private tournaments.

It is hoped that our proprietary technology will allow for interactive, face-to-face competition, which we believe is the only medium which allows for the true test of a poker player's skill. Without the possibility of being able to see and affect your opponent psychologically, the game might as well not be played.

Our Strategy

Management hopes that the Company will be able to generate revenues from the following sources: (1) monthly membership fees; (2) advertisements; (3) tournament plays; (4) social network community; and (5) e-Commerce.

Monthly Membership Fees

Players on our game site will be grouped into two communities, paying members and free-members. Membership packages will consist of monthly payments, the price being dependent on the package the person selects. Our free--member community will accumulate “Fun Points”, while players in our paying member community will accumulate play chips leading to prizes and other giveaways.

A player in our free member community will need to accumulate points in order to have chance to play for smaller prizes. The player would be able to do this by winning these points playing in tournaments with other players or private tables. The tournaments will have various jackpots depending on qualifiers and points needed to enter any particular tournament.

Our paying member community will be able to win play chips enabling them entry into tournaments with bigger prizes and giveaways. For a monthly fee, players will receive the Company’s monthly newsletter written by gaming professionals and will be given the opportunity to access:

·	Entry into tournaments with monthly prizes;
·	A proprietary tournament rating leader board based on actual play;
·	Live chats customer service;

·	Ability to create private tables:

·	No ads, no interruptions game play: and

·	Access into our structured proprietary league structured tournaments.

We plan to attract members to sign up utilizing different incentive and marketing programs.

Advertisement – We anticipate developing a strong following in the “Play for Fun” portion of the website in the early days following our beta testing. We hope this provides us with an opportunity to generate advertisement dollars.

Tournament Plays – This component of the online gaming industry is by far one of the most popular and lucrative venues. We believe that the launch of “Tournament Play” will drastically increase the number of user’s who register on a monthly basis. We also hope that this will lead to even greater advertisement revenues.

Social Network Community – Up until now the social aspect of online poker has been relatively small when compared to other niche based communities. The existing format of online poker forces players to play as many hands as possible without any interaction among the players since players are unable to speak or directly view their opponents, there is no reasonable opportunity for them to interact with each other than on the hands played.

With the advent of our technology players will be able to see, communicate, and otherwise interact with other players in our online community. Our technology provides a new dimension of interaction which we hope will lead towards the development of social groups. We believe that this concept will help make us the most diverse and popular online poker social networks which we hope will lead to a larger player base, as compared to a standalone poker room, ultimately leading to greater revenues.

e-Commerce – In the natural course of development, we hope that merchants will find the online social community fertile ground to offer gambling related products and services. We will provide our e-commerce partners with the ability to market and sell their products directly through payment processing software. We will take a small percentage from each transaction we process adding to our list of revenue streams.

Employees

The Company has only one full-time employee as well as its officers and directors and a consultant, who will devote as much time as the Board of Directors determines is necessary to carry out the affairs of the Company.

Item 1A. Risk Factors

Smaller reporting companies are not required to provide the information required by this Item 1A.

Item 1B. Unresolved Staff Comments

None

Item 2. Properties

The Company does not own any real estate or other properties. The Company's office is located at 20 East Sunrise Highway, Suite 202, Valley Stream, New York 11581, in office space provided by Yitz Grossman, who was formerly a consultant of the Company, at no charge. It is currently sufficient for our operations.- Company will find and will look but has not found or even looked yet- will do so in the coming weeks

Item 3. Legal Proceedings.

There are no pending legal proceedings to which the Company is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company. The Company’s property is not the subject of any pending legal proceedings.

Notwithstanding the foregoing, on April 4, 2013 the United States Attorney and the Federal Bureau of Investigation announced charges against seven individuals for their roles in a conspiracy to commit securities fraud and the extortion of a con-conspirator. The complaint alleges that the defendants worked to fraudulently inflate the prices and trading volumes of publicly traded stock of small companies, including our company. One of the defendants was a consultant to the Company since February 2011 and has resigned effective April 10, 2013.

Item 4. Mine Safety Disclosures.

Not applicable

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Market Information

Our common stock is quoted on the OTC Bulletin Board (“OTCBB”) under the symbol “IKCC”. Trading of our common stock commenced on August 2,2011. Prior to that date, there was no market for our common stock. The following table sets forth the high and low sales prices as reported on the OTCBB. The quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission, and may not represent actual transactions.

FISCAL YEAR 2011	HIGH		LOW

Third Quarter	$	0.50	$	0.10
Fourth Quarter	$	0.43	$	0.06

FISCAL YEAR 2012	HIGH		LOW

First Quarter	$	0.20	$	.05
Second Quarter	$	.27	$	.13
Third Quarter	$	.3850	$	.17
Fourth Quarter	$	.42	$	.2175

The last reported sales price of our common stock on the OTCBB on April 3, 2013, was $.14.

Holders

As of April 3, 2013, there were 45 holders of record of our common stock.

Dividends

We have never declared or paid any cash dividends on our common stock nor do we anticipate paying any in the foreseeable future. Furthermore, we expect to retain any future earnings to finance our operations and expansion. The payment of cash dividends in the future will be at the discretion of our Board of Directors and will depend upon our earnings levels, capital requirements, any restrictive loan covenants and other factors the Board considers relevant.

Equity Compensation Plans

We do not have any equity compensation plans.

Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities

As of February 20, 2013, the Company issued 150,000 shares of its common stock to DCO Capital Group LLC. The issuance was in consideration for the extension of $75,000 loans made by DCO Capital to the Company until May 1, 2013.

As of February 9, 2013, the Company issued 100,000 shares of its common stock to Corporate Debt Consultants LLC. The issuance was in consideration for the extension of a $50,000 loan made by Corporate Debt to the Company until May 1, 2013.

As of January 10, 2013, the Company issued 346,000 shares of its common stock to DCO Capital Group. The issuance was in consideration for the extension of a $173,000 loan made by DCO Capital to the Company until May 1, 2013.

As of December 6, 2012, the Company issued 200,000 shares of its common stock to Yitz Grossman. The issuance was in consideration for the extension of a $100,000 loan made by Mr. Grossman to the Company originally due November 6, 2012 until May 1, 2013.

As of December 1, 2012, the Company issued the following shares of common stock to the following persons – 25,000 shares to Beth Englard; 100,000 shares to L. Frankel Irrv Childrens Trust; 500,000 shares to Small Cap Consultants, Inc.; 382,000 shares to BSF II, LLC; 150,000 shares to BFSF, LLC; 50,000 shares to Corporate Debt Consultants LLC; 54,000 shares to DCO Capital Group LLC.

On August 22, 2012, the Company issued 350,000 shares of its common stock to DCO Capital Group, LLC a Delaware limited liability company.

On June 15, 2012, in connection with the execution of certain modification agreements with each of Beth Englard and the L Frankel Irrv Childrens Trust, the Company issued 100,000 shares of its common stock to each such lender as consideration for agreeing to extend the maturity dates of outstanding promissory notes in the principal amount of $25,000 with Englard and $50,000 with the Trust, from June 15, 2012 to September 15, 2012.

On June 15, 2012, in connection with the execution of a certain modification agreement with Small Cap Consultants, Inc., the Company issued an aggregate of 500,000 shares of its common stock to Small Cap as consideration for extending the maturity dates of outstanding principal notes to Small Cap to the earlier of September 15, 2012 or the Company receiving $500,000 in financing.

On February 27, 2012, the Company issued 1,000,000 shares of its common stock to Corporate Debt Consultants, LLC, a New York limited liability company concurrent with a loan made by Corporate Debt Consultants to the Company. Corporate Debt was granted piggyback registration rights and demand registration rights upon a financing of at least $2,000,000 by the Company with respect to said shares.

On November 1, 2011, the Company issued 250,000 shares of its common stock to Small Cap Consultants, concurrent with a loan made by Small Cap Consultants to the Company.

On August 18, 2011, the Company issued 250,000 shares of its common stock to Small Cap Consultants concurrent with a loan made by Small Cap Consultants to the Company.

On June 23, 2011, the Company issued shares of common stock to the following persons in consideration for consulting services provided or to be provided by such persons to the Company: BSF II, 500,000 shares; Bonnie Leinhos 50,000 shares; Xstream Assets, LLC 2,000,000 shares; Nalesta Consulting Inc. 2,500,000 shares; and Steve Morgan 25,000 shares. These securities were issued in reliance on the exemption under Section 4(2) of the Act; the recipients are accredited investors; are not affiliates of the Company and had access to all of the information which would be required to be included in a registration statement and the transaction did not involve a public offering.

All of the foregoing issuances were made in reliance upon an exemption from registration provided under Section 4(2) of the Securities Act of 1933, as amended.

Purchases of Equity Securities by the Small Business Issuer and Affiliated Purchasers

For the period ended December 31, 2012, we have not repurchased any shares of our common stock.

Item 6. Selected Financial Data.

Smaller reporting companies are not required to provide the information required by this Item 6.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Certain statements contained in this prospectus, including statements regarding the anticipated development and expansion of our business, our intent, belief or current expectations, primarily with respect to the future operating performance of Game Face Gaming, Inc. All forward-looking statements speak only as of the date on which they are made. We undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they are made.

Plan of Operation

We are in the business of operating a reality gaming social network. We plan to offer a non wagering internet gaming website by incorporating proprietary technologies that will provide players with streaming video, audio and messaging capabilities. We believe that these enhancements will dramatically enhance the players’ online gaming experiences. These games include poker, chess, backgammon and others. We believe that these enhancements will dramatically enhance players’ online gaming experiences. Management is not aware of any online games sites which offer players the ability to see one another and speak live during game play.

We will require additional capital to develop and expand our gaming platform from beta testing to a full launch. We estimate that within the next 12 months we will need approximately $3,600,000 to fund its expenses over the next twelve months. On a monthly basis, if the Company had these funds it would utilize, among other uses, approximately $125,000 for advertising and marketing, $100,000 for salaries and office expenses and $60,000 for software development. There can be no assurance that additional capital will be available to the Company. The Company currently has no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

Current cash on hand is insufficient for all of the Company’s commitments for the next 12 months. We anticipate that the additional funding that we require will be in the form of equity financing from the sale of our common stock. However, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund additional development and expansion of our gaming platform from beta testing to a full launch. We cannot be certain that the required additional financing will be available or available on terms favorable to us. If additional funds are raised by the issuance of our equity securities, such as through the issuance and exercise of warrants, then existing stockholders will experience dilution of their ownership interest. We do not currently have any arrangements in place for any future equity financing.

If additional funds are raised by the issuance of debt or other equity instruments, we may be subject to certain limitations in our operations, and issuance of such securities may have rights senior to those of the then existing holders of common stock. If adequate funds are not available or not available on acceptable terms, we may be unable to fund expansion, develop or enhance services or respond to competitive pressures or continue to operate.

We do not anticipate any equipment purchases in the twelve months ending December 31, 2013.

Results of Operations

Years Ended December 31, 2012 and 2011

We had $3,348 in cash and cash equivalent as of December 31, 2012, and have experienced losses since inception. We recognized $113,301in income in 2012 from Site membership sales . Expenses during the year ended December 31, 2012 were $1,301,894 for a net loss of $3,440,537 compared to expenses of $743,844 for a net loss of $971,772 for the year ended December 31, 2011. Expenses for the year ended December 31, 2012 were primarily the result of from Operations, development and Marketing and general and administrative expenses, while expenses for the year ended December 31, 2011 consisted primarily of general and administrative expenses ($609,607), professional fees ($79,512) and advertising expenses ($52,368) due to expenditures necessary as the Company prepares to launch its first product offering. We have incurred a cumulative net loss of $4,438,725 for the period December 24, 2009 (inception) to December 31, 2012.

Liquidity and Capital Resources

Our balance sheet as of December 31, 2012 reflects that the Company has $3,384 in cash and cash equivalents. In addition, the Company had a working capital deficiency of $ 3,317,925 at December 31, 2012.

As of December 31, 2012 we had a total of $1,666,000 owed to nine entities and individuals, of which $416,000 are due upon demand and $1,250,000 are due on May 1, 2013 with the exception of one Note in the amount of $25,000 which was due on March 15, 2013 and is currently in default. Of the $1,666,000 outstanding as of December 31, 2012, $466,000 is owed to affiliates of the company.

During the first quarter of 2013, the Company borrowed $97,000 of additional funds nonaffiliated lenders. On January 24, 2013 the Company canceled three of the notes totaling $125,000 and issued a note in the amount of $134,414 to an unrelated party. The Note issued included $9,414 of accrued interest due to holders of the cancelled Notes. The note payable has a conversion factor whereby the note holder may convert the principal amount and accrued unpaid interest into common stock equal to a price which is a 32.5% discount from the lowest “VWAP in the 3 days prior to the day that the holder requests conversion.

In addition to the outstanding Notes, as of April 14, 2013, we also currently owe $311,000 in cash and non cash prizes to our site members. the break down of that amount is as follows, As of Dec 31, 2012 the amount of the cash prizes owed was $151,000 and a $80,000 in non cash prizes, equaling a total of $231,000 owed on 12-31-12. For the period of 1-1-2013 to April 14, 2013 we owe an additional $45,000 in cash prizes and $35,000 in no cash prizes.

Going Concern Consideration

The Company is a development stage company. For the period December 24, 2009 (date of inception) through December 31, 2011, the Company has had a net loss of $$4,438,725. Our independent auditor has expressed substantial doubt about our ability to continue as a going concern and believes that our ability is dependent on our ability to begin operations and to achieve profitability. See Note 6 of our financial statements.

The Company believes that it will need approximately $3,600,000 to fund its expenses over the next twelve months. On a monthly basis, if the Company had these funds it would utilize, among other uses, approximately $125,000 for advertising and marketing, $100,000 for salaries and office expenses and $60,000 for software development. There can be no assurance that additional capital will be available to the Company. The Company currently has no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, results of operations or liquidity.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

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

Item 8. Financial Statements.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of Face Up Entertainment Group, Inc. (fka Game Face Gaming, Inc.)

We have audited the accompanying balance sheet of Face Up Entertainment Group, Inc. (fka Game Face Gaming, Inc.) (a development stage company) (the “Company”) as of December 31, 2012 and 2011 and the related statements of operations, stockholders’ equity/(deficit), and cash flows for each of the years in the two-year period ended December 31, 2012, and for the period since December 24, 2009 (inception) through December 31, 2012. These financial statements are the responsibility of the company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Face Up Entertainment Group, Inc. (fka Game Face Gaming, Inc.) (a development stage company) as of December 31, 2012 and 2011 and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2012, and for the period since December 24, 2009 (inception) through December 31, 2012, in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed further in Note 6, the Company has been in the development stage since its inception (December 24, 2009) and continues to incur significant losses. The Company's viability is dependent upon its ability to obtain future financing and the success of its future operations. These factors raise substantial doubt as to the Company's ability to continue as a going concern. Management's plan in regard to these matters is also described in Note 6. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Lake & Associates CPA’s LLC

Lake & Associates CPA’s LLC

Schaumburg, Illinois

April 15, 2013

F-1

Face Up Entertainment Group, Inc.

(f/k/a Game Face Gaming, Inc.)

(A Development Stage Company)

Consolidated Balance Sheets

ASSETS
	December 31,			December 31,
	2012			2011
	(Unaudited)			(Audited)

CURRENT ASSETS:
Cash and cash equivalents	$	3,348		$	18,325
Prepaid expenses and other current assets		1,438			1,621
TOTAL CURRENT ASSETS		4,786			19,946

PROPERTY AND EQUIPMENT (Net)		204,670			35,070

OTHER ASSETS
Intangible asset		100,000			100,000
TOTAL OTHER ASSETS		100,000			100,000

TOTAL ASSETS	$	309,456		$	155,016

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:
Accounts payable		344,217			10,450
Accrued expenses and other current liabilities		14,724			15,458
Derivative liabilities		1,213,280			178,070
Notes payable-convertible		1,666,000			656,000
Accrued interest on notes payable--convertible		84,490			12,396

TOTAL CURRENT LIABILITIES		3,322,711			872,374

STOCKHOLDERS' EQUITY (DEFICIT):
Capital stock - authorized:
250,000,000 common shares, $0.0001 par value
61,582,000 and 56,175,000 shares issued and outstanding at
December 31, 2012 and December 31, 2011, respectively		6,159			5,618
Additional paid in capital		1,419,311			275,212
Deficit accumulated during the development stage		(4,438,725	)		(998,188	)
TOTAL STOCKHOLDERS' EQUITY (DEFICIT)		(3,013,255	)		(717,358	)

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	$	309,456		$	155,016

F-2

Face Up Entertainment Group, Inc. and Subsidiary

(f/k/a Game Face Gaming, Inc.)

(A Development Stage Company)

Consolidated Statements of Operations

	For the Year Ended			For the Year Ended			For the Period December 24, 2009 (Inception) to
	December 31,			December 31,			December 31,
	2012			2011			2012

REVENUES:
Net revenue	$	113,301		$	105,000		$	218,301

EXPENSES:
Depreciation expense		3,143			2,357			5,500
General & administrative expenses		1,298,751			741,487			2,066,654

Total expenses		1,301,894			743,844			2,072,154

Operating Loss		(1,188,593	)		(638,844	)		(1,853,853	)

OTHER INCOME (EXPENSE):
Interest expense		(1,216,734	)		(157,274	)		(1,374,008	)
Derivate liability		(1,035,210	)		(178,070	)		(1,213,280	)
Interest income
Other income - cancellation of debt		-			2,416			2,416

Total other income (expense)		(2,251,944	)		(332,928	)		(2,584,872	)

Income (Loss) before Provision for Income Taxes		(3,440,537	)		(971,772	)		(4,438,725	)

Provision for Income Taxes		-			-			-

Net Loss	$	(3,440,537	)	$	(971,772	)	$	(4,438,725	)

PER SHARE DATA:
Basic and diluted loss per common share	$	(0.06	)	$	(0.02	)
Weighted Average Common shares outstanding		58,145,150			61,856,370

F-3

Face Up Entertainment Group, Inc. and Subsidiary

(f/k/a Game Face Gaming, Inc.)

(A Development Stage Company)

Consolidated Statements of Stockholders' Equity (Deficit)

													Deficit
													Accumulated
							Additional			Stock			During the
	Common Stock						Paid-in			Subscriptions			Development
	Shares			Amount			Capital			Receivable			Stage			Total

Inception - December 24, 2009		-		$	-		$	-		$	-		$	-		$	-

Common shares issued to Founder
for cash at $0.001 per share
(par value $0.00001) on December 24, 2009		117,000,000			11,700			(2,700	)		(3,000	)		-			6,000

Loss for the period from inception on
December 24, 2009 to December 31, 2009		-			-			-			-			(3,579	)		(3,579	)

Balance - December 31, 2009		117,000,000			11,700			(2,700	)		(3,000	)		(3,579	)		2,421

Payment of Subscription Receivable											3,000						3,000

Common shares issued to Investors
for cash at $0.01 per share
(par value $0.00001) on May 26, 2010		15,600,000			1,560			10,440									12,000

Loss for the year ended December 31, 2010														(22,837	)		(22,837	)

Balance - December 31, 2010		132,600,000			13,260			7,740			-			(26,416	)		(5,416	)

Common shares cancelled by
the Corporation on February 10, 2011		(104,666,667	)		(10,467	)		10,467									-

Common shares issued at $0.0044 per share
(par value $0.0001) for the contribution of
intangible assets on February 22, 2011		22,666,667			2,267			97,733									100,000

Common shares issued to Consultants for services at
$0.0044 per share (par value $0.0001) on June 23, 2011		5,075,000			508			21,822									22,330

Common shares issued for finance costs at
$0.25 per share (par value $0.0001) on August 17, 2011		250,000			25			62,475									62,500

Common shares issued for finance costs
$0.30 per share (par value $0.0001) on October 31, 2011		250,000			25			74,975									75,000

Loss for the year ended December 31, 2011														(971,772	)		(971,772	)

Balance - December 31, 2011		56,175,000			5,618			275,212			-			(998,188	)		(717,358	)

Common shares issued for finance costs
$0.16 per share (par value $0.0001) on February 27, 2012		1,000,000			100			159,900									160,000

Common shares issued for finance costs
$0.17 per share (par value $0.0001) on May 29, 2012		500,000			50			84,950									85,000

Common shares issued for finance costs
$0.27 per share (par value $0.0001) on June 15, 2012		700,000			70			97,930									98,000

Common shares issued for finance costs
$0.18 per share (par value $0.0001) on August 9, 2012		250,000			25			44,975									45,000

Common shares issued for finance costs
$0.18 per share (par value $0.0001) on August 22, 2012		350,000			35			62,965									63,000

Common shares issued for finance costs
$0.20 per share (par value $0.0001) on November 29, 2012		454,000			46			90,755									90,800

Common shares issued for finance costs
$0.28 per share (par value $0.0001) on December 1, 2012		2,153,000			215			602,625									602,840

Loss for the twelve months ended December 31, 2012														(3,440,537	)		(3,440,537	)

Balance - December 31, 2012		61,582,000		$	6,159		$	1,419,311		$	-		$	(4,438,725	)	$	(3,013,255	)

F-4

Face Up Entertainment Group, Inc. and Subsidiary

(f/k/a Game Face Gaming, Inc.)

(A Development Stage Company)

Consolidated Statements of Cash Flows

	For the Year Ended			For the Year Ended			For the Period December 24, 2009 (Inception) to
	Dcember 31,			December 31,			December 31,
	2012			2011			2012
OPERATING ACTIVITIES:
Net loss	$	(3,440,537	)	$	(971,772	)	$	(4,438,725	)

Depreciation		3,143			2,357			5,500
Common stock issued for services		-			22,330			22,330
Common stock issued for financing costs		1,144,640			137,500			1,282,140

Changes in Assets and Liabilities:
(Increase) decrease in current assets:
Prepaid Expenses and other current assets		183			(1,621	)		(1,438	)
Increase (decrease) in current liabilities:
Accounts payable		333,767			7,450			344,217
Derivative liabilities		1,035,210			178,070			1,213,280
Accrued interest on convertible debt		72,094			12,396			84,490
Accrued expenses and other current liabilities		(734	)		15,458			14,724

Net cash used in operating activities		(852,234	)		(597,832	)		(1,473,482	)

INVESTMENT ACTIVITIES:
Computer hardware purchased		-			(9,427	)		(9,427	)
Source code purchased		(172,743	)		(28,000	)		(200,743	)
Net cash provided by investment activities		(172,743	)		(37,427	)		(210,170	)

FINANCING ACTIVITIES:
Common stock issued					-			21,000
Issuance of notes payable		1,010,000			851,000			1,861,000
Repayments of notes payable		-			(195,000	)		(195,000	)
Loan from officer		-			(3,000	)		-
Net cash provided by financing activities		1,010,000			653,000			1,687,000

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(14,977	)		17,741			3,348

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		18,325			584			-

CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	3,348		$	18,325		$	3,348

Supplemental Cash Flow Disclosures:
Cash paid for:
Interest expense	$	-		$	7,380		$	7,380
Income taxes	$	-		$	-		$	-
Non-cash transactions:
Stock Issued for intangible asset	$	-		$	100,000		$	100,000

F-5

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

NOTE 1 - GENERAL ORGANIZATION AND BUSINESS

Face Up Entertainment Group, Inc. (f/k/a Game Face Gaming, Inc.) the Company is a development stage company, incorporated in the State of Florida on December 24, 2009 to provide software to companies to help them market and sell their music and entertainment content to consumers. On April 24, 2012 the Company changed its name from Game Face Gaming, Inc. (F/K/A Intake Communications, Inc.) to Face Up Entertainment Group, Inc.

Since February 2011, the Company has been engaged in developing the internet’s first Reality Gaming Social Network. The Company seeks to penetrate the market in the business of operating a non-wagering Internet social media and gaming company. The Internet Gaming platform incorporates proprietary technologies that will provide users with streaming video, audio and messaging capabilities enhancing both the users experience and the gaming experience.

Face Up Entertainment Group’s proprietary platform will be used in creating a vast global gaming network consisting of games from every region of the globe, supporting native languages as well as cross language functionality. Once these games make their way onto our platform they will be accessible on almost all devices currently used to access the internet. In addition to popular and well known games that are already being played on line by tens of millions of people around the world, Game Face will be launching its own in- house developed games.

NOTE 2 - SUMMARIES OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company is currently a development stage enterprise reporting under the provisions of FASB ASC 915, Development Stage Entity. The financial statements have been prepared on the accrual basis of accounting in conformity accounting principles generally accepted in the United States of America.

Principles of Consolidation

The consolidated financial statements include the accounts of Face Up Entertainment Group, Inc. (F/K/A Game Face Gaming, Inc.) and its wholly owned subsidiary Socii Management, LLC. All material intercompany balances and transactions have been eliminated from in consolidation.

Cash and Cash Equivalents

For purposes of the cash flow statements, the company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. At December 31, 2012 the company did not have any balances that exceeded FDIC insurance limits.

F-6

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

Property and Equipment

Property and equipment is stated at cost. Depreciation and amortization expense is computed using principally accelerated methods over the estimated useful life of the related assets ranging from 3 to 7 years. When assets are sold or retired, their costs and accumulated depreciation are eliminated from the accounts and any gain or loss resulting from their disposal is included in the statement of operations.

The Company recognizes an impairment loss on property and equipment when evidence, such as the sum of expected future cash flows (undiscounted and without interest charges), indicates that future operations will not produce sufficient revenue to cover the related future costs, including depreciation, and when the carrying amount of the asset cannot be realized through sale. Measurement of the impairment loss is based on the fair value of the assets.

Long-Lived Assets

Long-lived assets such as intangible assets other than goodwill, furniture, equipment and leasehold improvements are evaluated for impairment when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Recoverability of asset groups to be held and used is measured by a comparison of the carrying amount of an asset group to estimated undiscounted future cash flows expected to be generated by the asset group. If the carrying amount exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of an asset group exceeds the fair value of the asset group. The Company evaluated its long-lived assets and no impairment charges were recorded for any of the periods presented.

Earnings (Loss) per Share

The Company adopted FASB ASC 260, Earnings per Share. Basic earnings (loss) per share is calculated by dividing the Company's net income available to common shareholders by the weighted average number of common shares outstanding during the year. Diluted earnings (loss) per share is calculated by dividing the Company's net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted as of the first of the year for any potentially dilutive debt or equity. There were no diluted or potentially diluted shares outstanding for all periods presented.

Software Development Costs

The Company accounts for costs incurred to develop computer software for internal use in accordance with FASB ASC 350-40 “Internal-Use Software”. As required by ASC 350-40, the Company capitalizes the costs incurred during the application development stage, which include costs to design the software configuration and interfaces, coding, installation, and testing. Costs incurred during the preliminary project along with post-implementation stages of internal use computer software are expensed as incurred. Capitalized development costs are amortized over a period of one to three years. Costs incurred to maintain existing product offerings are expensed as incurred. The capitalization and ongoing assessment of recoverability of development costs requires considerable judgment by management with respect to certain external factors, including, but not limited to, technological and economic feasibility, and estimated economic life.

Dividends

The Company has not adopted a policy regarding payments of dividends. No dividends have been paid during the period presented and no payments are foreseen in the near future.

F-7

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

Income Taxes

The Company adopted FASB ASC 740, Income Taxes, at its inception. 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 bases. Deferred tax assets, including tax loss and credit carry forwards, and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred income tax expense represents the change during the period in the deferred tax assets and deferred tax liabilities. The components of the deferred tax assets and liabilities are individually classified as current and non-current based on their characteristics. 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. No deferred tax assets or liabilities were recognized as of December 31, 2012.

Uncertain Tax Positions

The Company adopted the provisions of Accounting for Uncertainty in Income Taxes (“Uncertain Tax Positions”) of the ASC. Uncertain Tax Positions prescribes recognition thresholds that must be met before a tax position is recognized in the financial statements and provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Under “Uncertain Tax Positions”, an entity may only recognize or continue to recognize tax positions that meet a ““more-than-likely-than-not” threshold. All related interest and penalties would be expensed as incurred. The Company has evaluated its tax position for the period ended December 31, 2012and such evaluation did not require a material adjustment to the financial statements.

Advertising and Marketing

The Company expenses advertising and marketing as incurred. For the year ended December 31, 2012 and 2011, advertising expense totaled $331,159 and $52,368 respectively.

Stock Based Compensation

The Company accounts for all stock based payments in accordance with ASC Topic 718, which requires the Company to measure all employee stock-based compensation awards using a fair value method and record the related expense in the financial statements. The Company utilizes the Black-Scholes model to estimate the value of options granted.

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, requires management to make estimates and assumptions that could affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Fair Value of Financial Instruments

The carrying amounts of the Company’s accounts payable, accrued expenses and notes payable approximate fair value due to the relatively short period to maturity for these instruments.

Concentration of Credit Risk

The Company’s financial instruments that are exposed to the concentrations of credit risk consist primarily of cash and cash equivalents. The Company’s places its cash with high quality institutions. At times, such investments may be in excess of the FDIC insurance limit. Cash and cash equivalents held in a bank may exceed federally insured limits at year end and at various points during the year.

F-8

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

The Company routinely assesses the financial strength of its customers and, as a consequence, believes that its trade accounts receivable credit risk exposure is limited.

Revenue Recognition

The company has adopted the following revenue recognition guidelines.

Sale of subscriptions

Revenue from sale of subscriptions is recognized when the following conditions are satisfied:

* The user properly registered with the website of the Company, and provided the Company with a valid proof of identity and address. Furthermore the Company had set up a valid user account for the user;

* The amount of revenue can be measured reliably;

* The costs incurred or to be incurred in respect of the transaction can be measured reliably.

Whitepaper Solution income

Revenue from sale of Whitepaper Solutions is recognized when the following conditions are met:

* The contract for the solutions clearly specifies the price and payment options with the transfer of ownership;

* The Company is reasonably expected to complete the project in the time frame that the contract sets forth;

* As the milestones set forth in the contract are met, the Company will recognize revenue as set forth in the contract;

* As set forth in the contract the amount of revenue can be measured reliably;

* There is a reasonable belief that buyer is expected to pay the whole amount as the milestones are met.

Effect of recently issued accounting standards

The company has adopted all recently issued accounting pronouncements. The Adoption of the accounting pronouncements, including those not yet effective, is not anticipated to have a material effect on the financial position or results of operations of the Company.

F-9

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

NOTE 3 - INCOME TAXES

Deferred tax attributes resulting from differences between financial accounting methods and tax basis of assets and liabilities at December 31, 2012 are as follows (rounded to the nearest hundred):

	December 31, 2012
Noncurrent Assets:
Net operating loss carry-forwards	$	583,000
Valuation Allowance	$	(583,000	)
Net Deferred Tax Asset	$	$0

At December 31, 2012, the Company had estimated net loss carry forwards of approximately $1,943,000 which expire between 2029 through 2031. Utilization of these net operating loss card forwards may be limited in accordance with IRC Section 382 in the event of certain shifts in ownership.

The reconciliation of federal statutory income tax rate to our effective income tax rate is as follows:

December 31, 2012	Amount			Percent
Book income at Federal Statutory Rate	$	(315,000	)		25	%
State Taxes, net of Federal Benefit	$	(63,000	)		5	%
Change in Valuation Allowances	$	378,000			(30	%)
	$	0			0	%

NOTE 4 - STOCKHOLDERS' EQUITY

Common Stock

On December 24, 2009, the Company issued 117,000,000 of its $0.0001 par value common stock at $0.001 per share for $6,000 cash and $3,000 in a subscription receivable to the founder of the Company. The issuance of the shares was made to the sole officer and director of the Company and an individual who is a sophisticated and accredited investor, therefore, the issuance was exempt from registration of the Securities Act of 1933 by reason of Section 4 (2) of that Act.

F-10

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

On May 26, 2010 the Company issued 15,600,000 common shares to investors in accordance with Form S-1 for cash in the amount of $12,000.

On January 6, 2011, the Board of Directors and majority shareholder of the Company approved an amendment to the Company’s Articles of Incorporation (the “Amendment”) to (i) affect a 13 for 1 forward stock split of the Company’s issued and outstanding common stock in the form of a dividend. Accordingly there were 10,200,000 pre-split common shares and following the forward split there were 132,600,000 common shares issued and outstanding. All share amounts, including those stated above, have been adjusted to reflect the forward split. On February 10, 2011, Ron Warren, the principal shareholder and sole officer and director of the Company cancelled 104,666,667 of his own shares and on February 22, 2011 the Company issued an additional 22,666,667 shares in an intangible asset purchase.

On February 22, 2011 the Company issued 22,666,667 common shares at $0.0001 par value and $0.0044 face value to Lemberg Consulting for their intellectual property and pending patents in the amount of $100,000.

On June 23, 2011 the Company issued 5,075,000 common shares at $0.0001 par value and $0.0044 face value to various “founding fathers” of the company for services rendered to the company in lieu of cash.

On August 17, 2011 the Company issued 250,000 common shares at $0.0001 par value and $0.25 face value as an inducement for the $100,000 note payable issued on that date. The value of the 250,000 common shares issued totaled $62,500.

On October 31, 2011 the Company issued 250,000 common shares at $0.0001 par value and $0.30 face value as an inducement for the $100,000 note payable issued on that date. The value of the 250,000 common shares issued totaled $75,000.

On February 29, 2012 the Company issued 1,000,000 common shares at $0.0001 par value and $0.16 face value as an inducement for the $500,000 line of credit entered by the Company on that date. The value of the 1,000,000 common shares issued totaled $160,000.

On May 29, 2012 the Company issued 500,000 common shares at $0.0001 par value and $0.17 face value as an inducement for the $200,000 line of credit entered by the Company on that date. The value of the 500,000 common shares issued totaled $85,000.

On June 15, 2012 the Company issued 700,000 common shares at $0.0001 par value and $0.14 face value as an inducement for an extension of time of the due date on the convertible debt outstanding by the Company on that date. The value of the 700,000 common shares issued totaled $98,000.

On August 9, 2012 the Company issued 250,000 common shares at $0.0001 par value and $0.18 face value as an inducement for the $100,000 line of credit entered by the Company on that date. The value of the 250,000 common shares issued totaled $45,000.

On August 22, 2012 the Company issued 350,000 common shares at $0.0001 par value and $0.18 face value as an inducement for the $100,000 line of credit entered by the Company on that date. The value of the 350,000 common shares issued totaled $63,000.

F-11

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

On November 29, 2012 the Company issued 454,000 common shares at $0.0001 par value and $0.20 face value as an inducement for the extension of time of the due date on both the convertible and non-convertible debt outstanding by the Company on that date. The value of the 454,000 common shares issued totaled $90,800.

On December 1, 2012 the Company issued 2,153,000 common shares at $0.0001 par value and $0.28 face value as an inducement for the extension of time of the due date on both the convertible and non-convertible debt outstanding by the Company on that date. The value of the 2,153,000 common shares issued totaled $602,840

As of December 31, 2012 there are 250,000,000 Common Shares at $0.0001 par value authorized with 61,582,000 shares issued and outstanding.

NOTE 5 - RELATED PARTY TRANSACTIONS

The officers and directors of the Company are involved in business activities outside of the company and may, in the future, become involved in other business opportunities that become available. They may face a conflict in selecting between the Company and other business interests. The Company has not formulated a policy for the resolution of such conflicts.

The Company has demand notes payable outstanding totaling $516,000 to related parties; these outstanding notes bear interest between 3% to 6% per annum (See Note 9).

NOTE 6 - GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. For the period December 24, 2009 (date of inception) through December 31, 2012 the Company has had a net loss of $4,438,725. As of December 31, 2012, the Company has not emerged from the development stage. In view of these matters, recoverability of any asset amounts shown in the accompanying financial statements is dependent upon the Company's ability to begin operations and to achieve a level of profitability. Since inception, the Company has financed its activities from the sale of equity securities, and obtaining loans. The Company intends on financing its future development activities and its working capital needs largely from notes, loans and the sale of public equity securities, until such time that funds provided by operations, if ever, are sufficient to fund working capital requirements.

NOTE 7 - PROPERTY AND EQUIPMENT

	December 31, 2012

Computer hardware	$	9,427
Source code		200,742
		210,169
Less accumulated depreciation and amortization		(5,499	)
Property and Equipment (net)	$	204,670

Depreciation and amortization expense	$	3,143

During the year ended December 31, 2012 the company acquired $172,743 of source code for cash.

F-12

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

NOTE 8 - INTANGIBLE ASSETS

On February 22, 2011, the Company acquired from Lemberg Consulting an intangible asset worth $100,000 in a non-cash transaction for 22,666,667 shares of the Company. The company purchased future contracts and pending patents for a gaming system that incorporates voice and video into the gaming experience.

NOTE 9 - CONVERTIBLE DEBT

As of December 31, 2012 the bridge notes payable totaled $1,666,000. The bridge notes payable were offered by the company during 2011 and 2012. The bridge notes payable consist of $325,000 of convertible debt and $1,341,000 of demand notes bearing interest at rates varying from 3.00% to 6.50% per annum. A total of $516,000 of the demand notes were issued to related parties (See Note 5)

The convertible debt payable was issued by the Company as follows:

On February 22, 2011 the Company issued convertible debt totaling $175,000, bearing a rate of 8% simple interest per annum. On December 14, 2011, $100,000 was repaid plus accrued interest of $6,466.The remaining Convertible debt of $75,000 in addition to accrued unpaid interest shall be due and payable on December 1, 2012. The principal amount and all unpaid interest accrued on this debt maybe converted by the greater of $0.25 per share or 50% of the average closing bid price of the Common stock on the OTC Bulletin Board, for the 10 trading days ending 5 days before the conversion date. On April 14, 2012, the maturity date was extended to June 15, 2012 and the conversion factor was adjusted to $0.05 per share. On June 15, 2012, the maturity date was extended to September 15, 2012. As an inducement for the extension the Company issued the convertible note holders 200,000 share of common stock. On September 14, 2012 the maturity date was extended to December 1, 2012..

On June 22, 2011 the Company issued a convertible debt totaling $20,000, bearing a rate of 8.0% simple interest per annum. During December 2011, the principle was repaid in the amount of $20,000 plus $758 of accrued interest.

On August 17, 2011, the Company issued a convertible debt in amount of $100,000. The convertible debt bears a rate of 6.5% simple interest per annum. The principal and accrued unpaid interest shall be due and payable on December 1, 2012. As further inducement for the lender to advance the loan, the company granted the convertible debt holder the amount of 250,000 shares Common Stock. The principal amount and all unpaid interest accrued on this debt maybe converted by the greater of $0.05 per share or 50% of the average closing bid price of the Common stock on the OTC Bulletin Board, for the 10 trading days ending 5 days before the conversion date. On April 14, 2012, the maturity date was extended to June 15, 2012 and the conversion factor was adjusted to $0.05 per share. On June 15, 2012, the maturity date was extended to September 15, 2012. As an inducement for the extension the Company issued the convertible note holder 200,000 share of common stock. On September 14, 2012 the maturity date was extended to December 1, 2012.

On September 22, 2011, the Company issued demand debt in amount of $50,000. The debt bears a rate of 6.5% simple interest per annum. The principal and accrued unpaid interest shall be due and payable on December 1, 2012. On April 15, 2012, the maturity rate was extended to June 15, 2012. As inducement for the lender to extend the note, the demand debt was converted to convertible debt whereby the principal amount and all unpaid interest accrued on this debt maybe converted to common shares at a price of $0.05 per share. On June 15, 2012, the maturity date was extended to September 15, 2012. As an inducement for the extension the Company issued the convertible note holder 100,000 share of common stock. On September 14, 2012 the maturity date was extended to December 1, 2012.

F-13

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

On October 31, 2011, the Company issued a convertible debt in amount of $100,000. The convertible debt bears a rate of 6.5% simple interest per annum. The principal and accrued unpaid interest shall be due and payable on December 1, 2012. As further inducement for the lender to advance the loan, the company granted the convertible debt holder the amount of 250,000 shares Common Stock. The principal amount and all unpaid interest accrued on this debt maybe converted by the greater of $0.05 per share or 50% of the average closing bid price of the Common stock on the OTC Bulletin Board, for the 10 trading days ending 5 days before the conversion date. On April 14, 2012, the maturity date was extended to June 15, 2012 and the conversion factor was adjusted to $0.05 per share. On June 15, 2012, the maturity date was extended to September 15, 2012. As an inducement for the extension the Company issued the convertible note holder 200,000 share of common stock. On September 14, 2012 the maturity date was extended to December 1, 2012.

On August 9, 2012 the Company secured additional financing through the issuance of a Note Purchase Agreement, the total not to exceed $100,000. Each note will bear interest at 5% per annum and is payable within six months from the date of issuance or earlier from proceeds of a private offering or through a registration statement. As part of the agreement the Company granted the lender 250,000 shares of the Company’s common stock. On August 9, 2012, the Company borrowed $50,000. The Company has $50,000 available on this financing agreement.

On August 22, 2012 the Company secured additional financing through the issuance of a Note Purchase Agreement, the total not to exceed $100,000. Each note will bear interest at 5% per annum and is payable within six months from the date of issuance or earlier from proceeds of a private offering or through a registration statement. As part of the agreement the Company granted the lender 350,000 shares of the Company’s common stock. On August 22, 2012, the Company borrowed $50,000. On September 12, 2012, the Company borrowed $25,000.The Company has $25,000 available on this financing agreement.

The following table illustrates the carrying value of the demand notes payable and convertible debt:

	December 31, 2012
Convertible Notes	$	325,000
Notes with a six month maturity		825,000
Demand Notes to Related Parties		516,000
Discount on Convertible Note		(0	)
Convertible Note, Net		1,666,000
Less: Current portion of convertible debt		(1,666,000	)
Long term portion of convertible debt	$	-

F-14

FACE UP ENTERTAINMENT GROUP, INC. AND SUBSIDIARY

(F/K/A GAME FACE GAMING, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2012

The following tables illustrate the fair value adjustments that were recorded related to the derivative financial instruments associated with the convertible debenture financings:

	For the year ended December 31, 2012
Derivative income (expense):	Fair Value January 1, 2011			Fair Value Adjustments			Redemptions		Total
Convertible debt	$	(178,070	)	$	(1,035,210	)	$	-	$	(1,213,280	)
	$	(178,070	)	$	(1,035,210	)	$	-	$	(1,213,280	)

The following table illustrates the components of derivative liabilities:

Balance at December 31, 2011	$	178,070
Change in fair value of derivative liability due to beneficial conversion feature		1,035,210
Debt redemption		-
Balance at December 31, 2012	$	1,213,280

NOTE 10 - SUBSEQUENT EVENTS

The Company has evaluated subsequent events and transactions for potential recognition or disclosure in the financial statements through the date which the financial statements were issued.

On January 24, 2013 the Company canceled three of the notes totaling $125,000 to related parties and issued a note for $134,414 to an unrelated party. The note issued included $9,414 of accrued interest due to the related parties. The note payable has a conversion factor whereby the note holder may convert the principal amount and accrued unpaid interest into common stock equal to a price which is a 32.5% discount from the lowest “VWAP in the 3 days prior to the day that the holder requests conversion.

Subsequent to the balance sheet date the company issued 450,000 common shares as an inducement for the extension of time of the due date on the non-convertible debt outstanding by the company.

On January 11, 2013 the Company borrowed $50,000 through the issuance of a Note Purchase Agreement. The note bears interest at 3% per annum and is payable on May 11, 2013.

On February 22, 2013, the Company issued 162,500 of its $0.0001 par value common stock at $0.001 per share for $13,000 cash.

On March 15, 2013, the Company issued 257,143 of its $0.0001 par value common stock at $0.001 per share for $18,000 cash.

On March 19, 2013, the Company issued 200,000 of its $0.0001 par value common stock at $0.001 per share for $16,000 cash.

F-15

Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

There were no disagreements with accountants on accounting and financial disclosure of a type described in Item 304 (a)(1)(iv) or any reportable event as described in Item 304 (a)(1)(v) of Regulation S-K.

Item 9A. Controls and Procedures

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the company’s principal executive and principal financial officers and effected by the company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that:

●	Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;

●

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

●	Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations.

Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended, as of December 31, 2012. Based on this evaluation, our principal executive officer and principal financial officer concluded that, based on the material weaknesses discussed below, our disclosure controls and procedures were not effective to ensure that information required to be disclosed by us in reports filed or submitted under the Securities Exchange Act were recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Act Commission’s rules and forms and that our disclosure controls are not effectively designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act is accumulated and communicated to management, including our principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

As of December 31, 2012 management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control--Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") and SEC guidance on conducting such assessments. Based on that evaluation, they concluded that, during the period covered by this report, such internal controls and procedures were not effective to detect inappropriate application of US GAAP rules as more fully described below. This was due to deficiencies that existed in the design or operation of our internal controls over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses.

The matters involving internal controls and procedures that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; and (3) ineffective controls over period end financial disclosure and reporting processes. The aforementioned material weaknesses were identified by our Officers in connection with the review of our financial statements as of December 31, 2012.

Management believes any of the matters noted above could result in a material misstatement in our financial statements in future periods.

MANAGEMENT'S REMEDIATION INITIATIVES

In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:

We will create a position to segregate duties consistent with control objectives and will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us. And. we plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a full functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management post funding.

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.

We anticipate that these initiatives will be at least partially, if not fully, implemented with the next 12 months. Although we had planned to test our updated controls and remediate our deficiencies by November 30, 2012, we did not achieve this goal as a result of, among other reasons, a lack of funding and the absence of a new board member.

CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING

There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

Item 9B. Other Information.

None.

PART III

Item 10. Directors, Executive Officers and Corporate Governance.

Directors and Executive Officers

Set forth below are the names, ages and present principal occupations or employment, and material occupations, positions, offices or employments for the past five years of our current directors and executive officers.

Name	Age	Position

Felix Elinson	44	President, Chief Executive Officer, CFO and Director

Irving Bader	73	Secretary and Director

Felix Elinson has been our President and Chief Executive Officer and a director since February 11, 2011. Mr. Elinson brings to the Company a wide array of experience with marketing, on-line expertise, a proficiency in on-line games and had vast experiences that are helpful to the Company. Since February 2008, Mr. Elinson has served as a Strategic Partner in Mega M LLC, a registered merchant services, credit card processing company in New York. From August 2003 to January 2008, Mr. Elinson served as the Chief Executive Officer of Fresh Start Management Consulting Corp. where he was involved in various types of international commodity trading transactions. From August 2000 to July 2003, Mr. Elinson worked as an independent consultant. From May 1993 to July 2000, Mr. Elinson worked for futures and commodity firms as a Senior Sales Manager and trader such as Tran World Metals (cotton division, 1993-1997) and ICG (International Commodity Trading Group, Futures Division, 1998-2000).

Irving Bader has been Secretary and a director of the Company since February 11, 2011. Mr. Bader brings many years of management, organizational and marketing skills to the Company. From 1973 to present, Mr. Bader has been the owner and a director of the Seneca Lake Camp, an organization engaged in providing summer outdoor sporting activities for children ages 7 to 18. From 2002 to present, Mr. Bader has been the director and anchor for the Jewish Sport Network and from 2005 to present he has been the director of Athletics and an Associate Professor of Physical Education at Touro College. Mr. Bader is also the author of “A Pre-School P.E. Curriculum-An Adaptive Approach and “Motor Education for Retarded and Other Handicapped Children".

There are no familial relationships among any of our officers or directors, although Mr. Bader is the father in law of Yitz Grossman. None of our directors or officers has been affiliated with any company that has filed for bankruptcy within the last ten years. We are not aware of any proceedings to which any of our officers or directors, or any associate of any such officer or director, is a party adverse to us or any of our or has a material interest adverse to us or any of our subsidiaries.

Each director of the Company serves for a term of one year or until such director’s successor is duly elected and is qualified. Each officer serves, at the pleasure of the board of directors, for a term of one year and until such officer’s successor is duly elected and is qualified.

Code of Ethics; Financial Expert

We currently have a Code of Ethics applicable to our principal executive, financial and accounting officers. We currently do not have a “financial expert” on the board or an audit committee or nominating committee.

Potential Conflicts of Interest

Since we do not have an audit or compensation committee comprised of independent directors, the functions that would have been performed by such committees are performed by our directors. Thus, there is a potential conflict of interest in that our directors and officers have the authority to determine issues concerning management compensation and audit issues that may affect management decisions. We are not aware of any other conflicts of interest with any of our executives or directors.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires executive officers and directors of the Company and persons who own more than 10% of a registered class of the Company's equity securities to file reports of ownership and changes in their ownership with the Securities and Exchange Commission, and forward copies of such filings to the Company. Based solely on our review of copies of such reports and representations from our executive officers and directors, we believe that our executive officers and directors complied with all Section 16(a) filing requirements during the fiscal year ended December 31, 2012.

Involvement in Certain Legal Proceedings

There are no legal proceedings that have occurred within the past ten years concerning our directors, or control persons which involved a criminal conviction, a criminal proceeding, an administrative or civil proceeding limiting one's participation in the securities or banking industries, or a finding of securities or commodities law violations.

Notwithstanding the foregoing, on April 4, 2013 the United States Attorney and the Federal Bureau of Investigation announced charges against seven individuals for their roles in a conspiracy to commit securities fraud and the extortion of a con-conspirator. The complaint alleges that the defendants worked to fraudulently inflate the prices and trading volumes of publicly traded stock of small companies, including our company. One of the defendants was an unpaid consultant to the Company since February 2011 and resigned effective April 10, 2013.

Item 11. Executive Compensation.

Summary Compensation

The table below sets forth information concerning compensation paid, earned or accrued by our chief executive officer and each of our executive officers (each a “Named Executive Officer”) for the last two fiscal years. No other executive officer earned compensation in excess of $100,000 during our 2012 fiscal year.

SUMMARY COMPENSATION TABLE

Name and Principal Position	Fiscal Year	Salary ($)		Bonus ($)		Stock Awards($)		Option Awards ($) (10) (11)		Non-Equity Incentive Plan Compensation ($)		Nonqualified Deferred Compensation Earnings ($)		All Other Compensation ($)		Total ($)

Felix Elinson	2012		54,000		0		0		0		0		0		0		54,000
President and Chief	2011		54,000		0		0		0		0		0		0		54,000
Executive Officer

Irving Bader	2012		0		0		0		0		0		0		0		0
Secretary	2011		0		0		0		0		0		0		0		0

In connection with our asset acquisition on February 22, 2011, we entered into an employment agreement with Felix Elinson, pursuant to which Mr. Elinson became employed as our Chief Executive Officer. As Chief Executive Officer, Mr. Elinson is responsible for developing our business strategies, policies and operations, as well as such duties consistent with his position as the principal executive offer of the Company. In consideration for his services, Mr. Elinson is in agreement to be compensated with a monthly salary of $7,200, payable paid bi-monthly on the first and fifteenth business day of each month (No pay has been made since August 2012). Commencing upon the earlier to occur of the consummation of an equity financing of $1,000,000 or the first full month in which we have 15,000 paying subscribers, his compensation will increase to $12,000 per month. Mr. Elinson has agreed not to compete with the Company during the term of his employment and for a period of one and a half years thereafter. Mr. Elinson also agreed not to disclose confidential information. Although the agreement is on a month to month basis, we may terminate Mr. Elinson for cause at any time immediately upon written notice and should he be terminated, he is entitled to compensation accrued through the date of termination.

Since our incorporation on December 24, 2009, no stock options or stock appreciation rights were granted to our directors or executive officers and our directors or executive officers have not exercised any stock options or stock appreciation rights, and do not hold any unexercised stock options. We have no long-term incentive plans.

Outstanding Equity Awards

Our directors or executive officers do not hold any unexercised options, stock that had not vested, or equity incentive plan awards.

Compensation of Directors

Since our incorporation on December 24, 2009, no compensation has been paid to our directors in consideration for their services rendered in their capacities as directors.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The following table lists, as of April 14, 2013, the number of shares of our common stock that are beneficially owned by (i) each person or entity known to us to be the beneficial owner of more than 5% of our common stock; (ii) each executive officer and director of our company; and (iii) all executive officers and directors as a group. Information relating to beneficial ownership of Common Stock by our principal shareholders and management is based upon information furnished by each person using “beneficial ownership” concepts under the rules of the Securities and Exchange Commission. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or direct the voting of the security, or investment power, which includes the power to vote or direct the voting of the security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Under the Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary beneficial interest. Except as noted below, each person has sole voting and investment power.

The percentages below are calculated based on 62,642,666 shares of our common stock issued and outstanding as of April 9, 2013. Unless otherwise indicated, the address of each person listed is c/o Game Face Gaming, Inc., 20 East Sunrise Highway, Valley Stream, NY 11581.

Name of Beneficial Owner	Amount and Nature of Beneficial Ownership		Percent of Class

Felix Elinson (1) 2928 West 5th Street Brooklyn, NY 11224		11,333,333		18.09	%

Irving Bader (2)		11,333,333		18.09	%

Punim Chadoshos, LLC		11,333,334		18.09	%

Elina Leonova (3) 333 East 23rd Street New York, NY 10010		11,333,333		18.09	%

Directors and officers as a group (2 persons)		22,666,666	36.18		%

(1)	Mr. Elinson is President and Chief Executive Officer and a director of the Company.

(2)	Mr. Bader is Secretary and a director of the Company, and is the trustee of the CPT 2011 Trust which owns all of the membership interests of Punim Chadoshos, LLC, a New York limited liability company.

(3)	Mrs. Leonova is the wife of Alex Lemberg, a consultant to the Company.

Punim Chadoshos, LLC has granted a proxy to Alex Lemberg to vote its shares effective upon the Company paying in full and satisfying all its obligations pursuant to the $300,000 private placement offering.

Item 13. Certain Relationships and Related Transactions, and Director Independence.

On February 22, 2011 we issued 22,666,667 to Lemberg Consulting Inc. in consideration of the intellectual rights relating to operating multi-platform, multiplayer non-wagering, non-games of chance. On February 28, 2011, Lemberg Consulting transferred 11,333,334 of said shares to Elina Leonova, the wife of Alex Lemberg, a consultant to the Company, and 11,333,333 shares to Felix Elinson, our President and Chief Executive Officer and a director.

On February 22, 2011, Punim Chadoshos, LLC a shareholder holding 19.82% of our issued and outstanding stock, executed a non-competition/confidentiality agreement with the Company. Punim Chadoshos has granted a proxy to Alex Lemberg to vote its shares effective upon the Company paying in full and satisfying all its obligations pursuant to the $300,000 private placement offering.

Alex Lemberg, a consultant to the Company, is married to Elina Leonova, who holds 19.82% of our issued and outstanding stock. Punim Chadoshos has granted Mr. Lemberg a proxy to vote its shares effective upon the Company paying and satisfying in full all its obligations pursuant to its $300,000 convertible notes private placement offering.

On October 25, 2011, we issued a Demand Note in the principal amount of $25,000 to BSF, LLC. Lisa Grossman, wife of our consultant, Yitz Grossman, is a managing member of BSF, LLC.

On each of November 30, 2011, December 12, 2011 and December 14, 2011, the Company issued a Demand Note in the principal amount of $25,000, $75,000 and $106,000, respectively, to each of Arevim, Inc., BFSF, LLC and BSF II, LLC respectively. The Demand Notes bear interest at 6% per annum and can be prepaid by the Company without penalty. If the Demand Notes and accrued interest thereon are not paid within 10 days of demand, the interest rate will increase to 12% retroactive to the date of issuance of the Demand Note. All principal and accrued interest on the Demand Notes are convertible into shares of the Company’s common stock at the election of the holder at a conversion price per share equal to the lower of (i) $0.10 and (ii) the closing bid price on the date of conversion. If the Company fails to timely pay the Demand Note and accrued interest, it will be required to issue to the holder 20,000 shares, (for the first 30 days), 50,000 shares (for day 31 through 60) and 1,000,000 shares thereafter of its common stock per day. Lisa Grossman, is a managing member of BFSF, LLC and BSF II, LLC. She is the wife of Yitz Grossman, a consultant to the Company, and president of Arevim and a managing member of BFSF, LLC.

On January 18, 2012, the Company issued the BSF II Note in the principal amount of $85,000 to BSF II LLC. The BSF II Note is payable upon demand at any time after February 15, 2012. The BSF II Note bears interest at 6% per annum and can be prepaid by the Company without premium or penalty. Lisa Grossman, is a managing member of BSF II, LLC. She is the wife of Yitz Grossman, a consultant to the Company.

On February 22, 2011, we entered into a Consulting Agreement with Yitz Grossman pursuant to which he was retained as a consultant to advise us on corporate development and introduce the Company to some of his contacts which may have an interest in investing in the Company. The term of the Agreement is for a period of three years and will automatically be extended for an additional three years should we raise at least $3,000,000 gross capital. We agreed to compensate Mr. Grossman with the monthly sum of $10,000 to be paid bi-monthly on the first and fifteenth business day of each month, said payments to commence upon the earlier of the consummation of an equity financing of $2,000,000 or the first full month in which we have 15,000 paying subscribers. Mr. Grossman has also agreed not to compete with the Company during the term of his consultancy and for a period of one and a half years thereafter. Mr. Grossman has also agreed to not to disclosed confidential information. We have the right to terminate him for cause at any time immediately upon written notice and should he be terminated, he is entitled to compensation accrued through the date of termination. In connection with charges brought on April 4, 2013 by the United States Attorney and the Federal Bureau of Investigation against seven individuals for their roles in a conspiracy to commit securities fraud and the extortion, Mr. Grossman resigned, effective April 10, 2013.

Between December 2012 and March 2013, the company, in connection with Loan Extensions to its Note holders, issued a total of 3,057,000 shares. In connection therewith, all but one of the Note holders, agreed to extend their loans until May 1, 2013. One Note in the amount of $25,000 was extended until March 15, 2013. That loan has not been paid.

Director Independence

We are not subject to listing requirements of any national securities exchange or national securities association and, as a result, we are not at this time required to have our board comprised of a majority of “independent directors.” We do not believe that any of our directors currently meet the definition of “independent” as promulgated by the rules and regulations of the American Stock Exchange.

Item 14. Principal Accounting Fees and Services.

Our principal independent accountant is Lake and Associates CPAs. Their pre-approved fees billed to the Company are set forth below:

	Fiscal Year Ended December 31, 2012		Fiscal Year Ended December 31, 2011
Audit Fees	$	18,450	$	16,250
Audit Related Fees	$	0	$	0
Tax Fees	$	0	$	0
All Other Fees	$	0	$	0

As of December 31, 2012, the Company did not have a formal documented pre-approval policy for the fees of the principal accountant. The Company does not have an audit committee. The percentage of hours expended on the principal accountant's engagement to audit our financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant's full-time, permanent employees was 0%.

PART IV

Item 15. Exhibits. Financial Statement Schedules.

Exhibit		Document

3.1		Certificate of Incorporation of Registrant (filed as Exhibit 3.3 to the Registration Statement on Form S-1 filed with the Securities and Exchange Commission on February 2, 2010 and incorporated herein by reference)

3.2		By-Laws of Registrant (filed as Exhibit 3.2 the Registration Statement on Form S-1 filed with the Securities and Exchange Commission on February 2, 2010 and incorporated herein by reference)

3.3		Form of Articles of Amendment to the Articles of Incorporation as filed with the Secretary of State of Florida on January 7, 2011 (filed as Exhibit 3.3 to Current Report on Form 8-K filed with the Securities and Exchange Commission on January 25, 2011 and incorporated herein by reference)

4.1		Form of Convertible Promissory Note (filed as Exhibit 4.2 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 4, 2011 and incorporated herein by reference)

4.2		Form of Form of Modification and Extension Agreement, dated October 22, 2011 (filed as Exhibit 4.3 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

4.3		Form of Form of Modification and Extension Agreement, dated January 14, 2011(filed as Exhibit 4.4 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

4.4		Amendment to Note dated October 31, 2011, dated December 14, 2011(filed as Exhibit 4.5 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

4..5		Second Amendment to Note dated August 17, 2011, dated December 14, 2011(filed as Exhibit 4.6 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

4.6		Second Amendment to Note dated October 31, 2011, dated January 14, 2012(filed as Exhibit 4.7 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

4.7		Third Amendment to Note dated August 17, 2011, dated January 14, 2012(filed as Exhibit 4.8 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

4.8		Form of Demand Promissory Note (filed as Exhibit 4.9 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

4.9		Demand Promissory Note, dated January 18, 2012 issued to BSF II LLC (filed as Exhibit 4.10 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

4.10		Promissory Note, dated February 27, 2012, issued to Corporate Debt Consultants LLC (filed as Exhibit 4.11to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

10.1		Asset Purchase Agreement dated February 22, 2011 between Game Face Gaming, Inc. and Lemberg Consulting Inc. (filed a Exhibit 10.1 to Current Report filed with the Securities and Exchange Commission on February 28, 2011 and incorporated herein by reference)

10.2		Employment Agreement dated February 22, 2011 between Game Face Gaming, Inc. and Felix Elinson (filed a Exhibit 10.2 to Current Report filed with the Securities and Exchange Commission on February 28, 2011 and incorporated herein by reference)

10.3		Consulting Agreement dated February 22, 2011 between Game Face Gaming, Inc. and Yitz Grossman (filed a Exhibit 10.3 to Current Report filed with the Securities and Exchange Commission on February 28, 2011 and incorporated herein by reference)

10.4		Consulting Agreement dated February 22, 2011 between Game Face Gaming, Inc., Lemberg Consulting, Inc. and Alex Lemberg (filed a Exhibit 10.4 to Current Report filed with the Securities and Exchange Commission on February 28, 2011 and incorporated herein by reference)

10.5		Non-Competition Agreement dated February 22, 2011 between Game Face Gaming, Inc. and Punim Chadoshos, LLC. (filed a Exhibit 10.5 to Current Report filed with the Securities and Exchange Commission on February 28, 2011 and incorporated herein by reference)

10.6		Proxy executed by Punim Chadoshos, LLC. (filed a Exhibit 10.6 to Current Report filed with the Securities and Exchange Commission on February 28, 2011 and incorporated herein by reference)

10.7		Contract Agreement dated November 19, 2009 between Icreon Communications (P) Ltd. and Lemberg Consulting Inc. (filed a Exhibit 10.8 to Current Report filed with the Securities and Exchange Commission on February 28, 2011 and incorporated herein by reference)

10.8		Form of Convertible Note Purchase Agreement (filed a Exhibit 10.8 to Current Report filed with the Securities and Exchange Commission on March 4, 2011 and incorporated herein by reference)

10.9		Poker License Agreement dated March 1, 2011 between Game Face Gaming, Inc. and Atlas Software USA Inc. (filed a Exhibit 10.9 to Current Report filed with the Securities and Exchange Commission on March 4, 2011 and incorporated herein by reference)

10.9.1		Modification and Extension Agreement dates ad of April 15, 2011 between Game Face Gaming, Inc. and Atlas Software USA Inc.

10.10		Poker License Agreement dated March 3, 2011 between Game Face Gaming, Inc. and Prodigious Capital Group LLC. (filed a Exhibit 10.10 to Current Report filed with the Securities and Exchange Commission on March 4, 2011 and incorporated herein by reference)

10.10.1		Modification and Extension Agreement dates ad of April 15, 2011 between Game Face Gaming, Inc. and Prodigious Capital Group LLC

10.11		Subscription Documents and Procedures (filed as Exhibit 99.1 to the Registration Statement on Form S-1 filed with the Securities and Exchange Commission on February 2, 2010 and incorporated herein by reference)

10.12		Note Purchase Agreement, dated February 27, 2012 between the Company and Corporate Debt Consultants LLC (filed as Exhibit 10.12to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

10.13		Amendment to Note Purchase Agreement, dated February 27, 2012 between the Company and Corporate Debt Consultants LLC (filed as Exhibit 10.13 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

10.14		Letter Agreement, dated February 27, 2012, between the Company and Corporate Debt Consultants LLC (filed as Exhibit 10.14 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

10.15		Addendum to Note Purchase Agreement, dated February 27, 2012, between the Company and Corporate Debt Consultants LLC (filed as Exhibit 10.15 to Current Report on Form 8-K filed with the Securities and Exchange Commission on March 9, 2012 and incorporated herein by reference)

14.1		Code of Ethics ((filed as Exhibit 14.1 to the Registration Statement on Form S-1 filed with the Securities and Exchange Commission on February 2, 2010 and incorporated herein by reference)

31		Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002 (filed herewith)

32		Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)

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

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934 , the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	FACE UP ENTERTAINMENT GROUP, INC.

Dated: April 16, 2013	By:	/s/ Felix Elinson
		Felix Elinson
		President, Chief Executive Officer, and Director (Principal Executive, Financial and Accounting Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Dated: April 16, 2013	By:	/s/ Felix Elinson
		Felix Elinson
		President, Chief Executive Officer, and Director (Principal Executive, Financial and Accounting Officer)

Dated: April 16, 2013	By:	/s/ Irving Bader
		Irving Bader
		Secretary and Director

Attached files

Face Up Entertainment Group, Inc. Reports

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