As
filed with the Securities and Exchange Commission on August 14, 2017
Registration
Statement No. 333-215239
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
S-1/A
(Amendment
No. 3 )
REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933
IEG
Holdings Corporation
(Exact
name of registrant as specified in its charter)
Florida
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6141
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65-0888146
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(State
or other jurisdiction of
incorporation
or organization)
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(Primary
Standard Industrial
Classification
Code Number)
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(I.R.S.
Employer
Identification
No.)
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6160
West Tropicana Ave, Suite E-13
Las
Vegas, NV 89103
(702)
227-5626
(Address,
including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Paul
Mathieson
Chief
Executive Officer
6160
West Tropicana Ave, Suite E-13
Las
Vegas, NV 89103
(702)
227-5626
(Name,
address and telephone number of agent for service)
With
copies to:
Laura
Anthony, Esq.
Legal
& Compliance, LLC
330
Clematis Street, Suite 217
West
Palm Beach, FL 33401
Phone:
(800) 341-2684
Approximate
date of proposed sale to public: As soon as practicable after this registration statement becomes effective.
If
any of the securities being registered on the Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, check the following box: [X]
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration statement number of the earlier effective registration statement
for the same offering: [ ]
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier registration statement for the same offering: [ ]
If
this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier registration statement for the same offering: [ ]
Indicate
by check mark whether 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
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[ ]
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Accelerated filer
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[X]
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Non-accelerated filer
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[ ] (Do not check if a smaller reporting
company)
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Smaller reporting company
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[X]
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Emerging growth company [X]
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If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
CALCULATION
OF REGISTRATION FEE
Title
of Each Class of
Securities to Be Registered
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Amount
to Be
Registered (1)
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Proposed
Maximum
Offering Price
per Share
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Proposed
Maximum
Aggregate
Offering Price
(2)
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Amount
of
Registration
Fee (3)
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Shares of common stock
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9,089,220
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$
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3.00
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$
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27,267,660
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$
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3,160.32
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(1)
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Represents
shares offered by the selling stockholders.
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(2)
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Estimated
solely for the purpose of calculating the registration fee pursuant to Rule 457 under the Securities Act of 1933.
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(3)
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The
registration fee has been calculated in accordance with Rule 457(a), and $3,160.32 of the registration fee was
paid previously.
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The
registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until
the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective
on such date as the Commission, acting pursuant to Section 8(a) may determine.
EXPLANATORY
NOTE
Pursuant
to Rule 429 of the Securities Act of 1933, as amended, this registration statement also serves as Post-Effective Amendment No.
4 to the registrant’s registration statement on Form S-1 (No. 333-205729, declared effective on August 27, 2015) (the “2015
Form S-1”). The registrant hereby amends the 2015 Form S-1 to deregister all of the shares of common stock covered by the
2015 Form S-1 that were originally registered.
The
information in this prospectus is not complete and may be changed. The selling stockholders may not sell these securities until
the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to
sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
PRELIMINARY
PROSPECTUS
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SUBJECT
TO COMPLETION, AUGUST 14 , 2017
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IEG
HOLDINGS CORPORATION
9,089,220
Shares
IEG
Holdings Corporation
Common
Stock
This prospectus relates
to the resale of up to 9,089,220 shares of our common stock by the selling stockholders named in this prospectus. This prospectus
may be used by the selling stockholders named herein to resell, from time to time, those shares of our common stock included herein.
For information about the selling stockholders see “Selling Stockholders” on page 44.
Our
common stock is presently quoted on the OTCQB tier of the OTC Markets Group, Inc. under the trading symbol “IEGH”.
On August 10, 2017, the last sale price of our common stock as reported by the OTC Markets was $0.6999 per share.
We
will not receive any of the proceeds from the sale of the shares of common stock by the selling stockholders. The selling stockholders
will sell their shares at a fixed price of $3.00 per share for the duration of this offering. See “Determination
of Offering Price” and “Plan of Distribution.”
The
selling stockholders, and any participating broker-dealers, are deemed to be “underwriters” within the meaning of
the Securities Act of 1933, as amended (the “Securities Act”), and any commissions or discounts given to any such
broker-dealer may be regarded as underwriting commissions or discounts under the Securities Act. The selling stockholders have
informed us that they do not have any agreement or understanding, directly or indirectly, with any person to distribute their
common stock. We will be responsible for all fees and expenses incurred in connection with the preparation and filing of the registration
statement of which this prospectus is a part;
provided, however,
that we will not be required to pay any underwriters’
discounts or commissions relating to the securities covered by the registration statement.
We
are an “emerging growth company” as defined in the Securities and Exchange Commission (“SEC”) rules and
we will be subject to reduced public reporting requirements. See “Emerging Growth Company Status.”
Persons
effecting transactions in the shares should confirm the registration of these securities under the securities laws of the states
in which transactions occur or the existence of applicable exemptions from such registration.
THE
SHARES BEING OFFERED ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK. THEY SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN AFFORD
THE LOSS OF THEIR ENTIRE INVESTMENT. SEE “RISK FACTORS” BEGINNING ON PAGE 4 OF THIS PROSPECTUS FOR A DISCUSSION OF
INFORMATION THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN OUR SECURITIES.
NEITHER
THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR
PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
You
should rely only on the information contained in this prospectus. We have not, and the selling stockholders have not, authorized
anyone to provide you with different information from that contained in this prospectus or in any free writing prospectus that
we may authorize. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless
of the time of delivery of this prospectus or of any sale of our common stock. This prospectus does not constitute an offer to
sell, or a solicitation of an offer to buy the securities in any circumstances under which the offer or solicitation is unlawful.
Neither the delivery of this prospectus nor any distribution of securities in accordance with this prospectus shall, under any
circumstances, imply that there has been no change in our affairs since the date of this prospectus.
The
date of this prospectus is ____________________, 2017.
TABLE
OF CONTENTS
No
dealer, salesperson or other individual has been authorized to give any information or to make any representation other than those
contained in this prospectus in connection with the offer made by this prospectus and, if given or made, such information or representations
must not be relied upon as having been authorized by us or the selling stockholders. This prospectus does not constitute an offer
to sell or a solicitation of an offer to buy any securities in any jurisdiction in which such an offer or solicitation is not
authorized or in which the person making such offer or solicitation is not qualified to do so, or to any person to whom it is
unlawful to make such offer or solicitation. Neither the delivery of this prospectus nor any sale made hereunder shall, under
any circumstances, create any implication that there has been no change in our affairs or that information contained herein is
correct as of any time subsequent to the date hereof.
For
investors outside the United States: We have not and the selling stockholders have not done anything that would permit this offering
or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in
the United States. Persons outside the United States who come into possession of this prospectus must inform themselves, and observe
any restrictions relating to, the offering of the shares of our common stock and the distribution of this prospectus outside the
United States.
CAUTIONARY
STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus and the documents incorporated by reference in this prospectus includes “forward-looking statements” within
the meaning of the federal securities laws that involve risks and uncertainties. Forward-looking statements include statements
we make concerning our plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures,
financing needs and other information that is not historical information. Some forward-looking statements appear under the headings
“Prospectus Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” and “Business.” When used in this prospectus, the words “estimates,”
“expects,” “anticipates,” “projects,” “forecasts,” “plans,” “intends,”
“believes,” “foresees,” “seeks,” “likely,” “may,” “might,”
“will,” “should,” “goal,” “target” or “intends” and variations of
these words or similar expressions (or the negative versions of any such words) are intended to identify forward-looking statements.
All forward-looking statements are based upon information available to us on the date of this prospectus.
We
have based these forward-looking statements on our current expectations and projections about future events. However, these forward-looking
statements are subject to risks, uncertainties and other factors, many of which are outside of our control, that could cause actual
results to differ materially from the results discussed in the forward-looking statements, including, among other things, the
matters discussed in this prospectus in the sections captioned “Prospectus Summary,” “Risk Factors,” “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” and “Business.” Some of the factors
that we believe could affect our results include:
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limitations
on our ability to continue operations and implement our business plan;
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our
history of operating losses;
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the
timing of and our ability to obtain financing on acceptable terms;
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the
effects of changing economic conditions;
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the
loss of members of the management team or other key personnel;
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competition
from larger, more established companies with greater economic resources than we have;
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costs
and other effects of legal and administrative proceedings, settlements, investigations and claims, which may not be covered
by insurance;
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costs
and damages relating to pending and future litigation;
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the
impact of additional legal and regulatory interpretations and rulemaking and our success in taking action to mitigate such
impacts;
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control
by our principal equity holders; and
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the
other factors set forth herein, including those set forth under “Risk Factors.”
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There
are likely other factors that could cause our actual results to differ materially from the results referred to in the forward-looking
statements. All forward-looking statements attributable to us in this prospectus apply only as of the date of this prospectus
and are expressly qualified in their entirety by the cautionary statements included in this prospectus. We undertake no obligation
to publicly update or revise forward-looking statements to reflect events or circumstances after the date made or to reflect the
occurrence of unanticipated events, except as required by law. All later written and oral forward-looking statements attributable
to us or a person acting on our behalf are expressly qualified in their entirety by the applicable cautionary statements. You
are advised to consult any further disclosures we make on related subjects in the reports we file with the SEC pursuant to Sections
13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
We
caution you not to place undue reliance on our forward-looking statements. You should carefully read this entire prospectus and
the documents incorporated by reference into this prospectus, particularly the section entitled “Risk Factors.”
INDUSTRY
AND MARKET DATA
We
are responsible for the disclosure in this prospectus. However, this prospectus includes industry data that we obtained from internal
surveys, market research, publicly available information and industry publications. The market research, publicly available information
and industry publications that we use generally state that the information contained therein has been obtained from sources believed
to be reliable. The information therein represents the most recently available data from the relevant sources and publications
and we believe remains reliable. We did not fund and are not otherwise affiliated with any of the sources cited in this prospectus.
Forward-looking information obtained from these sources is subject to the same qualifications and additional uncertainties regarding
the other forward-looking statements in this prospectus.
PROSPECTUS
SUMMARY
This
summary highlights material information concerning our business and this offering. This summary does not contain all of the information
that you should consider before making your investment decision. You should carefully read the entire prospectus and the information
incorporated by reference into this prospectus, including the information presented under the section entitled “Risk Factors”
and the financial data and related Notes, before making an investment decision. This summary contains forward-looking statements
that involve risks and uncertainties. Our actual results may differ significantly from future results contemplated in the forward-looking
statements as a result of factors such as those set forth in “Risk Factors” and “Cautionary Statement Regarding
Forward-Looking Statements.” All historical information in this prospectus has been adjusted to reflect (i) the 1-for-6
reverse stock split of our outstanding common stock that was effective February 22, 2013, (ii) the 1-for-100 reverse stock split
of our outstanding common stock that was effective June 17, 2015 and (iii) the net 1-for-10 reverse stock split of our outstanding
common stock that was effective October 27, 2016.
In
this prospectus, unless the context indicates otherwise, “IEG Holdings,” the “Company,” “we,”
“our,” “ours” or “us” refer to IEG Holdings Corporation, a Florida corporation, and its subsidiaries.
Our
Company
We
provide unsecured online consumer loans under the brand name “Mr. Amazing Loans” via our website and online application
portal at
www.mramazingloans.com
. We started our business and opened our first office in Las Vegas, Nevada in 2010. We
currently offer $5,000 and $10,000 unsecured consumer loans that mature in five years. We are currently licensed and originating
direct consumer loans in 20 states – Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana,
Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, Virginia and Wisconsin. We
provide loans to residents of these states through our online application portal, with all loans originated, processed and serviced
out of our centralized Las Vegas head office, which eliminates the need for physical offices in all of these states.
Our
strategy is to address the market needs of underbanked consumers that tend to be ignored by mainstream institutional credit providers
such as banks and credit unions, and charged excessive fees and interest by fringe lenders such as payday lenders. In the current
global environment, we believe there is a substantial need and opportunity for the small personal loans we offer.
All
of our personal loans are offered at prevailing statutory rates with fixed affordable repayments and no prepayment penalties.
We conduct full underwriting on all applications including credit checks and review of bank statements to ensure customers have
capacity to repay their loans, and have designed our loans to help customers reach a stronger financial position.
For
the years ended December 31, 2016 and 2015, we generated interest income of $2.09 million and $1.79 million, respectively, and
had net losses of $4.73 million and $5.70 million, respectively. For the six months ended June 30, 2017 and 2016, we generated
interest income of $0.85 million and $1.04 million, respectively, and had net losses of $1.56 million and $2.20 million, respectively.
We
were organized as a Florida corporation on January 21, 1999, originally under the name Interact Technologies, Inc. In February
2013, we changed our name to IEG Holdings Corporation. We have two wholly-owned subsidiaries, Investment Evolution Corporation
(“IEC”), our U.S. operating entity that holds all of our state licenses, leases, employee contracts and other operating
and administrative assets, and IEC SPV, LLC (“IEC SPV”), a bankruptcy remote special purpose entity that holds our
U.S. loan receivables.
Our
principal office is located at 6160 West Tropicana Avenue, Suite E-13, Las Vegas, Nevada 89103 and our phone number is (702) 227-5626.
Our corporate website address is www.investmentevolution.com. Information contained on, or accessible through, our website is
not a part of, and is not incorporated by reference into, this document.
Recent
Developments
LendingClub Corporation Tender Offer
On
July 12, 2017, the Company filed a registration statement on Form S-4 (the “S-4 Registration Statement”) and a Schedule
TO relating to the Company’s offer to exchange four shares of the Company’s common stock for each share of common
stock of LendingClub Corporation (“Lending Club”), par value $0.01 per share, up to an aggregate of 40,345,603 shares
of Lending Club common stock, representing approximately 9.99% of Lending Club’s outstanding shares as of April 28, 2017,
validly tendered and not properly withdrawn in the offer (the “Lending Club Tender Offer”). The Lending Club Tender
Offer and the withdrawal rights were set to expire at 5:00 p.m., Eastern time, on August 10, 2017, unless extended.
Following
the launch of the Lending Club Tender Offer, the Company’s per share stock price, as quoted on the OTCQB, dropped significantly.
On August 1, 2017, due to the stock price drop, the Company determined that the Lending Club Tender Offer no longer had a reasonable
chance of success and accordingly, the Company determined that it would terminate the Lending Club Tender Offer and withdraw the
S-4 Registration Statement. Furthermore, the Company has no intention of launching the Lending Club Tender Offer or another tender
offer in the near future. Any shares that have been tendered by Lending Club stockholders have not yet been accepted and will
be returned to the relevant stockholders.
Abandonment
of Reverse-Forward Stock Split and Cash-Out
On
June 21, 2017, the Company filed with the Securities and Exchange Commission (the “Commission”) a preliminary information
statement on Schedule 14C (the “Preliminary Information Statement”). The Preliminary Information Statement, though
not in definitive form, related to a vote by the Company’s sole director and holder of a majority of the voting power of
the issued and outstanding capital stock of the Company to effect a reverse 1-for-1,000 stock split (the “Reverse Split”),
followed immediately by a forward 1,000-for-1 stock split (the “Forward Split”) of the Company’s common stock.
The Company’s intention was that registered shareholders whose shares of stock were converted into less than one share in
the Reverse Split would receive cash payments equal to the fair value of those fractional interests. The Reverse Split and Forward
Split, together with the related cash payments to shareholders with less than 1,000 shares of common stock prior to the Reverse
Split are referred to herein as the “Reverse/Forward Split.”
On
July 18, 2017, the Company determined that it will not effect the Reverse/Forward Split at this time. Furthermore, the Company
has no intention of effecting the Reverse/Forward Split or any other reverse and/or forward split in the near future. For avoidance
of doubt, no reverse and/or forward split occurred on July 25, 2017, as originally disclosed in the Preliminary Information Statement,
and no stockholders were cashed out on July 25, 2017. Stockholders should disregard the Preliminary Information Statement that
was filed with the Commission in its entirety.
The
Company’s determination to abandon the Reverse/Forward Split was based on the Company’s launch, on July 12, 2017,
of the Lending Club Tender Offer. The Company launched the Lending Club Tender Offer on July 12, 2017, subsequent to the filing
of the Preliminary Information Statement with the Commission on June 21, 2017. The primary goal of the Reverse/Forward Split was
cost savings from reducing administrative costs associated with reducing shareholder accounts. The Company expected that a significant
number of new shareholders may have been obtained in connection with the Lending Club Tender Offer, including those holding fewer
than 1,000 shares. As a result, the Company determined that any expected cost savings may no longer be sufficient to justify proceeding
with the Reverse/Forward Split. Although the Company determined, on August 1, 2017, that it would abandon the Lending Club Tender
Offer, the Company does not intend to effect the Reverse/Forward Split or any other reverse and/or forward split in the near future.
The Company notes that previously completed reverse/forward stock splits have achieved substantial administrative cost savings,
and have not been designed for the purpose of “going private”.
Stock
Repurchase Program
In
January 2017, our Board of Directors approved a stock repurchase program authorizing the open market repurchase of up to $2,000,000
of our common stock for the following reasons:
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The
stock repurchase program permits the Company to purchase shares of its common stock from time to time at prices that are below
what the Board believes to be the true value of the shares.
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The
Company’s common stock is trading at close to record low prices.
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The
stock repurchase program reflects the commitment of our Board of Directors to enhance stockholder value and its confidence
in our long-term growth prospects.
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The
Board believes the stock repurchase program is a strategic investment and an appropriate use of corporate funds.
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Any
repurchases will only be effected to the extent that they do not impair the Company’s capital or the Company’s
ability to pay its debts.
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The
Company has available liquidity from existing customer loan repayments to be able to both reinvest in new customer loans and
also to strategically invest back into our company via stock repurchases.
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The
stock repurchase program will assist in improving stock liquidity and ensuring a more orderly and less volatile market for
a relatively small outlay of cash.
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No
purchases are required and the $2,000,000 cap on the stock repurchase program is relatively low.
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Purchases
under the program are authorized through December 31, 2017. Through August 10, an aggregate of 170,998 shares have been repurchased under this program for an aggregate purchase price
of $100,861.60.
Declaration
of Dividend
On
August 1, 2017, our sole director declared a cash dividend of $0.005 per common share for the second quarter of 2017. The dividend
is payable on August 21, 2017 to stockholders of record at the close of business on August 11, 2017.
Notes
Offering Terminated
In
December 2016, we launched a private offering of up to $10 million aggregate principal amount of our 12% senior unsecured notes
due December 31, 2026 (the “Notes”), on a self-underwritten basis. The Notes offering was terminated in May 2017.
No Notes were sold in the offering.
OneMain
Holdings, Inc. Tender Offer Closed
On
June 16, 2017, we closed our tender offer to purchase shares of common stock of OneMain Holdings, Inc. (“OneMain”),
with 151,994 OneMain shares of common stock acquired (valued at an aggregate of $3.55 million based on the closing price of shares
of OneMain common stock of $23.38 on June 15, 2017) in exchange for 3,039,880 shares of our common stock. The per share valuation
of IEG Holdings shares used in connection with the OneMain tender offer was $1.169 per IEG Holdings common share as at the close
date of the tender offer. On June 22, 2017, we sold 100% of the 151,994 shares of OneMain common stock which we obtained in our
tender offer for $3.4 million in cash. The current planned use of the proceeds from the sale of OneMain shares is to fund increased
new loan volumes in Q3 and a further use is to fund the payables to Mr. Mathieson pursuant to the terms of the consulting agreement
entered into on July 1, 2017.
Amendment
of Series H Preferred Stock
On
June 20, 2017, we filed articles of amendment (the “Amendment”) to our amended and restated articles of incorporation,
as amended (the “Articles”). The Amendment has the effect of revising the terms of the Series H preferred stock to:
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remove
rights to receive dividends on our Series H preferred stock;
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(2)
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increase
the conversion ratio of the Series H preferred stock from 0.2 shares of Common Stock per share of Series H preferred stock
to 1 share of Common Stock per share of Series H preferred stock;
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(3)
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remove
our right to redeem or call our Series H preferred stock;
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(4)
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provide
for automatic conversion of Series H preferred stock into shares of our Common Stock on December 31, 2017; and
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(5)
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remove
the voting rights for Series H preferred stock.
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The
Amendment was approved by our board of directors on June 19, 2017.
In
addition, on July 26, 2017, we filed articles of amendment to our Articles that had the effect of revising the terms of the Series
H preferred stock to increase the conversion ratio of the Series H preferred stock from one share of common stock per share of
Series H preferred stock to four shares of common stock per share of Series H preferred stock. The Articles amendment was approved
by our sole director on July 26, 2017.
Emerging
Growth Company Status
We
are an “emerging growth company” as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart
Our Business Startups Act of 2012 (the “JOBS Act”). As such, we are eligible to take advantage of certain exemptions
from various reporting requirements that are applicable to other public companies that are not “emerging growth companies”
including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley
Act of 2002 (the “Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in our periodic
reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation
and stockholder approval of any golden parachute payments not previously approved. We elected to take advantage of all of these
exemptions.
In
addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended
transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards,
and delay compliance with new or revised accounting standards until those standards are applicable to private companies. We have
elected to take advantage of the benefits of this extended transition period.
We
will be an emerging growth company until the last day of the first fiscal year following the fifth anniversary of our first common
equity offering, although we will lose that status earlier if our annual revenues exceed $1.0 billion, if we issue more than $1.0
billion in non-convertible debt in any three-year period or if we become a “large accelerated filer” as defined in
Rule 12b-2 under the Exchange Act.
The
Offering
Issuer
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IEG
Holdings Corporation
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Common
stock offered by the selling stockholders
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9,089,220
shares
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Common
stock outstanding
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12,754,066
shares
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Offering
price per share
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$3.00
(for the duration
of this offering). See
“Determination of Offering
Price” and “Plan of Distribution.”
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Use
of proceeds
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We
will not receive any proceeds from the sale of common stock by the selling stockholders in this offering. See “Use of
Proceeds” and “Selling Stockholders.”
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Risk
factors
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See
“Risk Factors” beginning on page 4 of this prospectus for a discussion of some of the factors you should carefully
consider before deciding to invest in our common stock.
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OTC
trading symbol
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IEGH
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Risk
Factors
Before
you invest in the offering, you should be aware that there are risks associated with your investment, including the risks described
in the section entitled “Risk Factors” beginning on page 4 of this prospectus and the risks set forth in our annual
report on Form 10-K for our fiscal year ended December 31,
2016. You should carefully read and consider
the risk factors contained in our annual report on Form 10-K and in this prospectus, together with all of the other information
included in this prospectus, before you decide to purchase our securities.
SUMMARY
HISTORICAL FINANCIAL DATA
The
following table presents our summary historical financial data for the periods indicated. The summary historical financial data
for the years ended December 31, 2016 and 2015 and the balance sheet data as of December 31, 2016 and 2015 are derived from the
audited financial statements. The summary historical financial data for the six months ended June 30, 2017 and 2016
and the balance sheet data as of June 30 , 2017 and 2016 are derived from our unaudited financial statements.
Historical
results are included for illustrative and informational purposes only and are not necessarily indicative of results we expect
in future periods, and results of interim periods are not necessarily indicative of results for the entire year. You should read
the following summary financial data in conjunction with “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” and our financial statements and related Notes appearing elsewhere in this prospectus.
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Year
Ended
December
31,
|
|
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Six
Months Ended
June
30,
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2016
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2015
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|
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2017
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2016
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|
|
|
|
|
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(Unaudited)
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Statement
of Operations Data
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|
|
|
|
|
|
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|
|
|
|
|
|
Total
revenues
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|
$
|
2,135,046
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$
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1,835,165
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|
|
$
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881,324
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|
|
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1,070,328
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Total
operating expenses
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|
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6,876,194
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|
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7,012,609
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|
|
|
2,284,021
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|
|
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3,283,289
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Loss
from operations
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|
|
(4,741,147
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)
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(5,177,444
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)
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|
|
(1,402,697
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)
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|
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(2,212,961
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)
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Total
other income (expense)
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12,278
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(520,754
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)
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(153,225
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)
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|
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11,750
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Net
loss
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$
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(4,728,869
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)
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$
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(5,698,198
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)
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$
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(1,555,922
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)
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|
|
(2,201,211
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)
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Net
loss per share, basic and diluted
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$
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(0.60
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)
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$
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(2.52
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)
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|
$
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(0.16
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)
|
|
|
(0.36
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)
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Balance
Sheet Data (at period end)
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December
31, 2016
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December
31, 2015
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June
30, 2017
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Cash
and cash equivalents
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$
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322,441
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$
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485,559
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$
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3,743,268
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Working
capital (1)
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1,709,310
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|
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|
1,581,100
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|
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4,948,849
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Total
assets
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6,821,947
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7,758,149
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8,885,016
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Total
liabilities
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1,060
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|
|
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107,963
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|
|
|
115,002
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Stockholders’
equity
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|
|
6,820,887
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|
|
|
7,650,186
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|
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8,770,014
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(1)
Working capital represents total current assets less total current liabilities.
RISK
FACTORS
Investment
in our securities involves a number of substantial risks. You should not invest in our securities unless you are able to bear
the complete loss of your investment. In addition to the risks and investment considerations discussed elsewhere in this prospectus,
the following factors should be carefully considered by anyone purchasing the securities offered through this prospectus. The
risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties not presently known
to us or that we currently deem immaterial also may impair our business operations. If any of the following risks actually occur,
our business could be harmed. In such case, the trading price of our common stock could decline and investors could lose all or
a part of their investment.
Risks
Related to Our Business and Industry
Our
limited operating history and our failure since inception to achieve an operating profit makes our future prospects and financial
performance unpredictable.
We
commenced operations in 2010 and as a result, we have a limited operating history upon which a potential investor can evaluate
our prospects and the potential value of an investment in our company. In addition, we have not made an operating profit since
our incorporation. We remain subject to the risks inherently associated with new business enterprises in general and, more specifically,
the risks of a new financial institution and, in particular, a new Internet-based financial institution. Our prospects are subject
to the risks and uncertainties frequently encountered by companies in their early stages of development, including the risk that
we will not be able to implement our business strategy. If we are unable to implement our business strategy and grow our business,
our business will be materially adversely affected.
We
may not be able to implement our plans for growth successfully, which could adversely affect our future operations.
Since
January 2015, the amount we have loaned to borrowers (our loan book) has increased by 159% from $5,549,023 to $14,699,023
as of July 31, 2017. We expect to continue to grow our loan book and number of customers at an accelerated rate in the future.
Our future success will depend in part on our continued ability to manage our growth. We may not be able to achieve our growth
plans, or sustain our historical growth rates or grow at all. Various factors, such as economic conditions, regulatory and legislative
considerations and competition, may also impede our ability to expand our market presence. If we are unable to grow as planned,
our business and prospects could be adversely affected.
Our
inability to manage our growth could harm our business.
We
anticipate that our loan book and customer base will continue to grow significantly over time. To manage the expected growth of
our operations and personnel, we will be required to, among other things:
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improve
existing and implement new transaction processing, operational and financial systems, procedures and controls;
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maintain
effective credit scoring and underwriting guidelines; and
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increase
our employee base and train and manage this growing employee base.
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If
we are unable to manage growth effectively, our business, prospects, financial condition and results of operations could be adversely
affected.
We
may need to raise additional capital that may not be available, which could harm our business.
Our
growth will require that we generate additional capital either through retained earnings or the issuance of additional debt or
equity securities. Additional capital may not be available on terms acceptable to us, if at all. Any equity financings could result
in dilution to our stockholders or reduction in the earnings available to our common stockholders. If adequate capital is not
available or the terms of such capital are not attractive, we may have to curtail our growth and our business, and our business,
prospects, financial condition and results of operations could be adversely affected.
As
an online consumer loan company whose principal means of delivering personal loans is the Internet, we are subject to risks particular
to that method of delivery.
We
are predominantly an online consumer loan company and there are a number of unique factors that Internet-based loan companies
face. These include concerns for the security of personal information, the absence of personal relationships between lenders and
customers, the absence of loyalty to a conventional hometown branch, customers’ difficulty in understanding and assessing
the substance and financial strength of an online loan company, a lack of confidence in the likelihood of success and permanence
of online loan companies and many individuals’ unwillingness to trust their personal details and financial future to a relatively
new technological medium such as the Internet. As a result, some potential customers may be unwilling to establish a relationship
with us.
Conventional
“brick and mortar” consumer loan companies, in growing numbers, are offering the option of Internet-based lending
to their existing and prospective customers. The public may perceive conventional established loan companies as being safer, more
responsive, more comfortable to deal with and more accountable as providers of their lending needs. We may not be able to offer
Internet-based lending that has sufficient advantages over the Internet-based lending services and other characteristics of conventional
“brick and mortar” consumer loan companies to enable us to compete successfully.
We
may not be able to make technological improvements as quickly as some of our competitors, which could harm our ability to compete
with our competitors and adversely affect our results of operations, financial condition and liquidity.
Both
the Internet and the financial services industry are undergoing rapid technological changes, with frequent introductions of new
technology-driven products and services. In addition to improving the ability to serve customers, the effective use of technology
increases efficiency and enables financial institutions to reduce costs. Our future success will depend in part upon our ability
to address the needs of our customers by using technology to provide products and services that will satisfy customer demands,
as well as to create additional efficiencies in our operations. We may not be able to effectively implement new technology-driven
products and services or be successful in marketing these products and services to our customers. If we are unable, for technical,
legal, financial or other reasons, to adapt in a timely manner to changing market conditions, customer requirements or emerging
industry standards, our business, prospects, financial condition and results of operations could be adversely affected.
A
significant disruption in our computer systems or a cyber security breach could adversely affect our operations.
We
rely extensively on our computer systems to manage our loan origination and other processes. Our systems are subject to damage
or interruption from power outages, computer and telecommunications failures, computer viruses, cyber security breaches, vandalism,
severe weather conditions, catastrophic events and human error, and our disaster recovery planning cannot account for all eventualities.
If our systems are damaged, fail to function properly or otherwise become unavailable, we may incur substantial costs to repair
or replace them, and may experience loss of critical data and interruptions or delays in our ability to perform critical functions,
which could adversely affect our business and results of operations. Any compromise of our security could also result in a violation
of applicable privacy and other laws, significant legal and financial exposure, damage to our reputation, loss or misuse of the
information and a loss of confidence in our security measures, which could harm our business.
Our
ability to protect the confidential information of our borrowers and investors may be adversely affected by cyber-attacks, computer
viruses, physical or electronic break-ins or similar disruptions.
We
process certain sensitive data from our borrowers and investors. While we have taken steps to protect confidential information
that we receive or have access to, our security measures could be breached. Any accidental or willful security breaches or other
unauthorized access to our systems could cause confidential borrower and investor information to be stolen and used for criminal
purposes. Security breaches or unauthorized access to confidential information could also expose us to liability related to the
loss of the information, time-consuming and expensive litigation and negative publicity. If security measures are breached because
of third-party action, employee error, malfeasance or otherwise, or if design flaws in our software are exposed and exploited,
our relationships with borrowers and investors could be severely damaged, and we could incur significant liability.
Because
techniques used to sabotage or obtain unauthorized access to systems change frequently and generally are not recognized until
they are launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures.
In addition, federal regulators and many federal and state laws and regulations require companies to notify individuals of data
security breaches involving their personal data. These mandatory disclosures regarding a security breach are costly to implement
and often lead to widespread negative publicity, which may cause borrowers and investors to lose confidence in the effectiveness
of our data security measures. Any security breach, whether actual or perceived, would harm our reputation, we could lose borrowers
and investors and our business and operations could be adversely affected.
Any
significant disruption in service on our platform or in our computer systems, including events beyond our control, could prevent
us from processing or posting payments on loans, reduce the attractiveness of our marketplace and result in a loss of borrowers
or investors.
In
the event of a system outage and physical data loss, our ability to perform our servicing obligations, process applications or
make loans available would be materially and adversely affected. The satisfactory performance, reliability and availability of
our technology are critical to our operations, customer service, reputation and our ability to attract new and retain existing
borrowers and investors.
Any
interruptions or delays in our service, whether as a result of third-party error, our error, natural disasters or security breaches,
whether accidental or willful, could harm our relationships with our borrowers and investors and our reputation. Additionally,
in the event of damage or interruption, our insurance policies may not adequately compensate us for any losses that we may incur.
Our disaster recovery plan has not been tested under actual disaster conditions, and we may not have sufficient capacity to recover
all data and services in the event of an outage. These factors could prevent us from processing or posting payments on the loans,
damage our brand and reputation, divert our employees’ attention, reduce our revenue, subject us to liability and cause
borrowers and investors to abandon our marketplace, any of which could adversely affect our business, financial condition and
results of operations.
We
contract with third parties to provide services related to our online web lending and marketing, as well as systems that automate
the servicing of our loan portfolios. See “—We depend on third-party service providers for our core operations including
online lending and loan servicing and interruptions in or terminations of their services could materially impair the quality of
our services.” While there are material cybersecurity risks associated with these services, we require that our vendors
provide industry-leading encryption, strong access control policies, Statement on Standards for Attestation Engagements (SSAE)
16 audited data centers, systematic methods for testing risks and uncovering vulnerabilities, and industry compliance audits to
ensure data and assets are protected. To date, we have not experienced any cyber incidents that were material, either individually
or in the aggregate.
Our
unsecured loans generally have delinquency and default rates higher than prime and secured loans, which could result in higher
loan losses.
We
are in the business of originating unsecured personal loans. As of June 30, 2017, approximately 2.57% of our customers
are subprime borrowers, which we define as borrowers having credit scores below 600 on the credit risk scale developed by VantageScore
Solutions, LLC. Unsecured personal loans and subprime loans generally have higher delinquency and default rates than secured loans
and prime loans. Subprime borrowers are associated with lower collection rates and are subject to higher loss rates than prime
borrowers. Subprime borrowers have historically been, and may in the future become, more likely to be affected, or more severely
affected, by adverse macroeconomic conditions, particularly unemployment. If our borrowers default under an unsecured loan, we
will bear a risk of loss of principal, which could adversely affect our cash flow from operations. Delinquency interrupts the
flow of projected interest income from a loan, and default can ultimately lead to a loss. We attempt to manage these risks with
risk-based loan pricing and appropriate management policies. However, we cannot assure you that such management policies will
prevent delinquencies or defaults and, if such policies and methods are insufficient to control our delinquency and default risks
and do not result in appropriate loan pricing, our business, financial condition, liquidity and results of operations could be
harmed. If aspects of our business, including the quality of our borrowers, are significantly affected by economic changes or
any other conditions in the future, we cannot be certain that our policies and procedures for underwriting, processing and servicing
loans will adequately adapt to such changes. If we fail to adapt to changing economic conditions or other factors, or if such
changes affect our borrowers’ capacity to repay their loans, our results of operations, financial condition and liquidity
could be materially adversely affected. At June 30, 2017, we had 151 loans considered past due at 31+ days past
due, representing 10.78% of the number of loans in our active portfolio. At June 30, 2017, we had 74 loans
delinquent or in default (defined as 91+ days past due) representing 5.58% of the number of loans in our active portfolio.
Loans become eligible for a lender to take legal action at 60 days past due.
If
our estimates of loan receivable losses are not adequate to absorb actual losses, our provision for loan receivable losses would
increase, which would adversely affect our results of operations.
We
maintain an allowance for loans receivable losses. To estimate the appropriate level of allowance for loan receivable losses,
we consider known and relevant internal and external factors that affect loan receivable collectability, including the total amount
of loan receivables outstanding, historical loan receivable charge-offs, our current collection patterns, and economic trends.
If customer behavior changes as a result of economic conditions and if we are unable to predict how the unemployment rate, housing
foreclosures, and general economic uncertainty may affect our allowance for loan receivable losses, our provision may be inadequate.
Our allowance for loan receivable losses is an estimate, and if actual loan receivable losses are materially greater than our
allowance for loan receivable losses, our financial position, liquidity, and results of operations could be adversely affected.
Our
risk management efforts may not be effective which could result in unforeseen losses.
We
could incur substantial losses and our business operations could be disrupted if we are unable to effectively identify, manage,
monitor, and mitigate financial risks, such as credit risk, interest rate risk, prepayment risk, liquidity risk, and other market-related
risks, as well as operational risks related to our business, assets and liabilities. Our risk management policies, procedures,
and techniques, including our scoring methodology, may not be sufficient to identify all of the risks we are exposed to, mitigate
the risks we have identified or identify additional risks to which we may become subject in the future.
We
face strong competition for customers and may not succeed in implementing our business strategy.
Our
business strategy depends on our ability to remain competitive. There is strong competition for customers from personal loan companies
and other types of consumer lenders, including those that use the Internet as a medium for lending or as an advertising platform.
Our competitors include:
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large,
publicly-traded, state-licensed personal loan companies such as OneMain;
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peer-to-peer
lending companies such as LendingClub and Prosper Marketplace Inc.;
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online
personal loan companies such as Avant;
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“brick
and mortar” personal loan companies, including those that have implemented websites to facilitate online lending; and
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payday
lenders, tribal lenders and other online consumer loan companies.
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Some
of these competitors have been in business for a long time and have name recognition and an established customer base. Most of
our competitors are larger and have greater financial and personnel resources. In order to compete profitably, we may need to
reduce the rates we offer on loans, which may adversely affect our business, prospects, financial condition and results of operations.
To remain competitive, we believe we must successfully implement our business strategy. Our success depends on, among other things:
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having
a large and increasing number of customers who use our loans for financing needs;
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our
ability to attract, hire and retain key personnel as our business grows;
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our
ability to secure additional capital as needed;
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our
ability to offer products and services with fewer employees than competitors;
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the
satisfaction of our customers with our customer service;
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ease
of use of our websites; and
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our
ability to provide a secure and stable technology platform for providing personal loans that provides us with reliable and
effective operational, financial and information systems.
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If
we are unable to implement our business strategy, our business, prospects, financial condition and results of operations could
be adversely affected.
We
depend on third-party service providers for our core operations including online lending and loan servicing, and interruptions
in or terminations of their services could materially impair the quality of our services.
We
rely substantially upon third-party service providers for our core operations, including online web lending and marketing and
vendors that provide systems that automate the servicing of our loan portfolios which allow us to increase the efficiency and
accuracy of our operations. These systems include tracking and accounting of our loan portfolio as well as customer relationship
management, collections, funds disbursement, security and reporting. This reliance may mean that we will not be able to resolve
operational problems internally or on a timely basis, which could lead to customer dissatisfaction or long-term disruption of
our operations. If these service arrangements are terminated for any reason without an immediately available substitute arrangement,
our operations may be severely interrupted or delayed. If such interruption or delay were to continue for a substantial period
of time, our business, prospects, financial condition and results of operations could be adversely affected.
If
we lose the services of any of our key management personnel, our business could suffer.
Our
future success significantly depends on the continued service and performance of our Chief Executive Officer, Paul Mathieson and
our Chief Operating Officer, Carla Cholewinski. Competition for these employees is intense and we may not be able to attract and
retain key personnel. We do not maintain any “key man” or other related insurance. The loss of the service of our
Chief Executive Officer or our Chief Operating Officer, or the inability to attract additional qualified personnel as needed,
could materially harm our business.
We
have incurred, and will continue to incur, increased costs as a result of being a public reporting company.
In
April 2015, we became a public reporting company. As a public reporting company, we incur significant legal, accounting and other
expenses that we did not incur as a non-reporting company, including costs associated with our SEC reporting requirements. We
expect that the additional reporting and other obligations imposed on us under the Exchange Act, will increase our legal and financial
compliance costs and the costs of our related legal, accounting and administrative activities significantly. Management estimates
that compliance with the Exchange Act reporting requirements as a reporting company will cost in excess of $200,000 annually.
Given our current financial resources, these additional compliance costs could have a material adverse impact on our financial
position and ability to achieve profitable results. These increased costs will require us to divert money that we could otherwise
use to expand our business and achieve our strategic objectives.
We
operate in a highly competitive market, and we cannot ensure that the competitive pressures we face will not have a material adverse
effect on our results of operations, financial condition and liquidity.
The
consumer finance industry is highly competitive. Our success depends, in large part, on our ability to originate consumer loan
receivables. We compete with other consumer finance companies as well as other types of financial institutions that offer similar
products and services in originating loan receivables. Some of these competitors may have greater financial, technical and marketing
resources than we possess. Some competitors may also have a lower cost of funds and access to funding sources that may not be
available to us. While banks and credit card companies have decreased their lending to non-prime customers in recent years, there
is no assurance that such lenders will not resume those lending activities. Further, because of increased regulatory pressure
on payday lenders, many of those lenders are starting to make more traditional installment consumer loans in order to reduce regulatory
scrutiny of their practices, which could increase competition in markets in which we operate.
Negative
publicity could adversely affect our business and operating results.
Negative
publicity about our industry or our company, including the quality and reliability of our marketplace, effectiveness of the credit
decisioning and scoring models used in the marketplace, changes to our marketplace, our ability to effectively manage and resolve
borrower and investor complaints, privacy and security practices, litigation, regulatory activity and the experience of borrowers
and investors with our marketplace or services, even if inaccurate, could adversely affect our reputation and the confidence in,
and the use of, our marketplace, which could harm our business and operating results. Harm to our reputation can arise from many
sources, including employee misconduct, misconduct by our partners, outsourced service providers or other counterparties, failure
by us or our partners to meet minimum standards of service and quality, inadequate protection of borrower and investor information
and compliance failures and claims.
Our
business is subject to extensive regulation in the jurisdictions in which we conduct our business.
Our
operations are subject to regulation, supervision and licensing under various federal, state and local statutes, ordinances and
regulations. In most states in which we operate, a consumer credit regulatory agency regulates and enforces laws relating to consumer
lenders such as us. These rules and regulations generally provide for licensing as a consumer lender, limitations on the amount,
duration and charges, including interest rates, for various categories of loans, requirements as to the form and content of finance
contracts and other documentation, and restrictions on collection practices and creditors’ rights. In certain states, we
are subject to periodic examination by state regulatory authorities. Some states in which we operate do not require special licensing
or provide extensive regulation of our business.
We
are also subject to extensive federal regulation, including the Truth in Lending Act, the Equal Credit Opportunity Act and the
Fair Credit Reporting Act. These laws require us to provide certain disclosures to prospective borrowers and protect against discriminatory
lending and leasing practices and unfair credit practices. The principal disclosures required under the Truth in Lending Act include
the terms of repayment, the total finance charge and the annual percentage rate charged on each contract or loan. The Equal Credit
Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national
origin, sex, age or marital status. According to Regulation B promulgated under the Equal Credit Opportunity Act, creditors are
required to make certain disclosures regarding consumer rights and advise consumers whose credit applications are not approved
of the reasons for the rejection. In addition, the credit scoring system used by us must comply with the requirements for such
a system as set forth in the Equal Credit Opportunity Act and Regulation B. The Fair Credit Reporting Act requires us to provide
certain information to consumers whose credit applications are not approved on the basis of a report obtained from a consumer
reporting agency and to respond to consumers who inquire regarding any adverse reporting submitted by us to the consumer reporting
agencies. Additionally, we are subject to the Gramm-Leach-Bliley Act, which requires us to maintain the privacy of certain consumer
data in our possession and to periodically communicate with consumers on privacy matters. We are also subject to the Servicemembers
Civil Relief Act, which requires us, in most circumstances, to reduce the interest rate charged to customers who have subsequently
joined, enlisted, been inducted or called to active military duty.
A
material failure to comply with applicable laws and regulations could result in regulatory actions, lawsuits and damage to our
reputation, which could have a material adverse effect on our results of operations, financial condition and liquidity.
The
Consumer Financial Protection Bureau (the “CFPB”) is a new federal agency formed pursuant to the Dodd-Frank Wall Street
Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), and there continues to be uncertainty as to how
the agency’s actions or the actions of any other new agency could impact our business.
The
CFPB, constituted pursuant to the Dodd-Frank Act, which commenced operations in 2011, has broad authority over the business in
which we engage. This includes authority to write regulations under federal consumer financial protection laws, such as the Truth
in Lending Act and the Equal Credit Opportunity Act, and to enforce those laws against and examine financial institutions for
compliance. The CFPB is authorized to prevent “unfair, deceptive or abusive acts or practices” through its regulatory,
supervisory and enforcement authority. To assist in its enforcement, the CFPB maintains an online complaint system that allows
consumers to log complaints with respect to various consumer finance products, including the loan products we facilitate. This
system could inform future CFPB decisions with respect to its regulatory, enforcement or examination focus.
We
are subject to the CFPB’s jurisdiction, including its enforcement authority, as a servicer and acquirer of consumer credit.
The CFPB may request reports concerning our organization, business conduct, markets and activities. The CFPB may also conduct
on-site examinations of our business on a periodic basis if the CFPB were to determine, through its complaint system, that we
were engaging in activities that pose risks to consumers.
There
continues to be uncertainty as to how the CFPB’s strategies and priorities, including in both its examination and enforcement
processes, will impact our businesses and our results of operations going forward. Actions by the CFPB could result in requirements
to alter or cease offering affected loan products and services, making them less attractive and restricting our ability to offer
them.
Actions
by the CFPB or other regulators against us or our competitors that discourage the use of the marketplace model or suggest to consumers
the desirability of other loan products or services could result in reputational harm and a loss of borrowers or investors. Our
compliance costs and litigation exposure could increase materially if the CFPB or other regulators enact new regulations, change
regulations that were previously adopted, modify, through supervision or enforcement, past regulatory guidance, or interpret existing
regulations in a manner different or stricter than have been previously interpreted.
If
our involvement in a December 11, 2014 article published in the Examiner or any other publicity regarding our company or the Offering
during the waiting period, including our December 2, 2014 press release, were held to be in violation of federal or state securities
laws, we could incur monetary damages, fines or other damages that could have a material adverse effect on our financial condition
and prospects.
On
December 11, 2014, information about our company was published in an article by the Examiner. Our Chief Executive Officer, Mr.
Mathieson, did not participate in an interview with the author of the Examiner article. Rather, the author included certain quotations
from Mr. Mathieson that were contained in prior press releases by us and summarized statements previously made by Mr. Mathieson
that were contained in a prior article published by the Opportunist Magazine. Prior to its publication, the author of the December
11
th
article provided Mr. Mathieson a copy of the article.
In
addition, we issued a press release on December 2, 2014 in which we referenced, among other things, our intention to file a registration
statement on Form S-1 and to list our securities on NASDAQ. The December 2
nd
press release presented certain statements
about our company in isolation and did not disclose many of the related risks and uncertainties described in this prospectus.
If
it were determined that the December 11
th
article, the December 2
nd
press release or any of our other publicity-related
activities constituted a violation of Section 5 of the Securities Act, the SEC and relevant state regulators could impose monetary
fines or other sanctions as provided under relevant federal and state securities laws. Such regulators could also require us to
make a rescission offer, which is an offer to repurchase securities offered in the relevant offering. This could also give rise
to a private right of action to seek a rescission remedy under Section 12(a)(2) of the Securities Act.
We
are unable to quantify the extent of any monetary damages that we might incur if monetary fines were imposed, rescission were
required or one or more other claims were successful. As of the date of this prospectus, we are not aware of any pending or threatened
claims alleging violations of any federal or state securities laws. However, there can be no assurance that any such claim will
not be asserted in the future or that the claimant in any such action will not prevail. The possibility that such claims may be
asserted in the future will continue until the expiration of the applicable federal and state statutes of limitations, which generally
vary from one to three years from the date of sale. If the payment of damages or fines is significant, it could have a material
adverse effect on our cash flows, financial condition or prospects.
We
are required to pay a prior lender interest on our net profit until 2025, which may have a material adverse effect on our results
of operations.
We
previously had a credit facility with BFG Investment Holdings, LLC (“BFG”). Effective July 15, 2015, BFG converted
the credit facility from a revolving facility to a term loan. On August 21, 2015, we, through certain of our wholly owned subsidiaries,
paid all principal and accrued interest under the Loan and Security Agreement, as amended (the “Loan Agreement”),
among BFG and certain of our wholly owned subsidiaries. As a result, there is currently no outstanding balance under the Loan
Agreement. However, the Loan Agreement continues in effect and we are subject to a net profit interest under which we are required
to pay BFG 20% of the “Net Profit” of our subsidiary, IEC SPV, until 10 years from the date the loan is repaid in
full. Net Profit is defined as the gross revenue less (i) interest paid on the loan, (ii) payments on any other debt incurred
as a result of refinancing the loan through a third party, as provided in the Loan Agreement, (iii) any costs, fees or commissions
paid on the existing credit facility, and (iv) charge-offs to bad debt resulting from consumer loans. The Net Profit arrangement
can be terminated by us upon a payment of $3,000,000 to BFG. For the years ended December 31, 2016 and 2015, we paid BFG Net Profit
interest of $57,094 and $107,340, respectively, and our net income for such years was reduced by those respective amounts. In
the future, if we fail to terminate the Net Profit arrangement and are required to pay BFG 20% of our Net Profit, it could have
a material adverse effect on our results of operations
Risks
Relating to Our Common Stock
Trading
on the OTC Markets is volatile and sporadic, which could depress the market price of our common stock and make it difficult for
our security holders to resell their common stock
.
Our
common stock is quoted on the OTCQB tier of the OTC Markets. Trading in securities quoted on the OTC Markets is often thin and
characterized by wide fluctuations in trading prices, due to many factors, some of which may have little to do with our operations
or business prospects. This volatility could depress the market price of our common stock for reasons unrelated to operating performance.
Moreover, the OTC Markets is not a stock exchange, and trading of securities on the OTC Markets is often more sporadic than the
trading of securities listed on a stock exchange like NASDAQ or the New York Stock Exchange. These factors may result in investors
having difficulty reselling any shares of our common stock.
Our
common stock price is likely to be highly volatile because of several factors, including a limited public float.
The
market price of our common stock has been volatile in the past. For example, as of August 10, 2017, our common stock has
had a 52-week high sale price of $15.80 and a low sale price of $0.14. The market price of our common stock is likely
to be highly volatile in the future, as well. You may not be able to resell shares of our common stock following periods of volatility
because of the market’s adverse reaction to volatility.
Other
factors that could cause such volatility may include, among other things:
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actual
or anticipated fluctuations in our operating results;
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the
absence of securities analysts covering us and distributing research and recommendations about us;
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we
may have a low trading volume for a number of reasons, including that a large portion of our stock is closely held;
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overall
stock market fluctuations;
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announcements
concerning our business or those of our competitors;
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actual
or perceived limitations on our ability to raise capital when we require it, and to raise such capital on favorable terms;
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conditions
or trends in the industry;
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litigation;
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changes
in market valuations of other similar companies;
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future
sales of common stock;
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departure
of key personnel or failure to hire key personnel; and
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general
market conditions.
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Any
of these factors could have a significant and adverse impact on the market price of our common stock. In addition, the stock market
in general has at times experienced extreme volatility and rapid decline that has often been unrelated or disproportionate to
the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of our
common stock, regardless of our actual operating performance.
The
offering price of the shares offered by the selling stockholders has been arbitrarily determined and such price should not be
used by an investor as an indicator of the fair market value of the shares.
The
offering price for the shares offered hereby by the selling stockholders has been arbitrarily determined and does not necessarily
bear any direct relationship to the assets, operations, book or other established criteria of value of our company. Accordingly,
the actual value of shares of our common stock may be significantly less than the offering price of $3.00 per share. The value
of shares purchased at the fixed offering price of $3.00 per share may decline in value or have significantly less value when
you attempt to sell such shares.
Because
Mr. Mathieson, our Chief Executive Officer and sole director, will make all management decisions, you should only invest in IEG
Holdings shares if you are comfortable entrusting Mr. Mathieson to make all decisions.
As
sole officer and director, Mr. Mathieson will have the right to make all decisions with respect to our management. Investors will
not have an opportunity to evaluate the specific projects that will be financed with future operating income. Our stockholders
should be willing to entrust all aspects of our management to Mr. Mathieson.
We
face corporate governance risks and negative investor perceptions because we have only one officer and director and have not adopted
a written policy for the review, approval or ratification of transactions with related parties or conflicted parties.
Mr.
Mathieson is our sole officer and director. As such, he has significant control over our business direction. Additionally, because
he is our sole director, there are no other board members available to second and/or approve related party transactions involving
Mr. Mathieson, including the compensation Mr. Mathieson may be paid and any consulting or other agreements we may enter into with
Mr. Mathieson. Additionally, there is no segregation of duties between officers because Mr. Mathieson is our sole officer, and
as such, he is solely responsible for the oversight of our accounting functions. Because no other directors are approving related
party transactions involving Mr. Mathieson and no other officers are approving our financial statements, investors may question
the fairness of related party transactions or the accuracy of financial statements. The price of our common stock may be adversely
affected and/or devalued compared to similarly sized companies with multiple officers and directors due to the investing public’s
perception of limitations facing our Company due to the fact that we only have one officer and director.
Although
Mr. Mathieson intends to enter into any related party transactions on an arms’ length basis, we do not have a written policy
for the review, approval or ratification of transactions with related parties or conflicted parties. As our sole officer and director,
Mr. Mathieson makes decisions such as the approval of related party transactions, Mr. Mathieson’s compensation, and oversight
of the accounting function. Mr. Mathieson exercises full control over all matters that typically require board approval. Accordingly,
Mr. Mathieson’s actions are not subject to the review and approval of a board of directors and, as such, the Company may
be at risk for a conflict of interest arising between Mr. Mathieson’s duties in his role as Chief Executive Officer and
his own personal financial and business interests in other business ventures distinct and separate from the interests of the Company.
His personal interests may not coincide with the interests of the stockholders and, in the absence of the effective segregation
of such duties, there is a risk of a conflict of interest.
Our
common stock is currently, has been in the past, and may be in the future, a “penny stock” under SEC rules. It may
be more difficult to resell securities classified as “penny stock.”
Our
common stock is a “penny stock” under applicable SEC rules (generally defined as non-exchange traded stock with a
per-share price below $5.00). Unless we obtain a per-share price above $5.00, these rules impose additional sales practice requirements
on broker-dealers that recommend the purchase or sale of penny stocks to persons other than those who qualify as “established
customers” or “accredited investors.” For example, broker-dealers must determine the appropriateness for non-qualifying
persons of investments in penny stocks. Broker-dealers must also provide, prior to a transaction in a penny stock not otherwise
exempt from the rules, a standardized risk disclosure document that provides information about penny stocks and the risks in the
penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock,
disclose the compensation of the broker-dealer and its salesperson in the transaction, furnish monthly account statements showing
the market value of each penny stock held in the customer’s account, provide a special written determination that the penny
stock is a suitable investment for the purchaser, and receive the purchaser’s written agreement to the transaction.
Legal
remedies available to an investor in “penny stocks” may include the following:
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If
a “penny stock” is sold to the investor in violation of the requirements listed above, or other federal or states
securities laws, the investor may be able to cancel the purchase and receive a refund of the investment.
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If
a “penny stock” is sold to the investor in a fraudulent manner, the investor may be able to sue the persons and
firms that committed the fraud for damages.
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However,
investors who have signed arbitration agreements may have to pursue their claims through arbitration.
These
requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security that
becomes subject to the penny stock rules. The additional burdens imposed upon broker-dealers by such requirements may discourage
broker-dealers from effecting transactions in our securities, which could severely limit the market price and liquidity of our
securities. These requirements may restrict the ability of broker-dealers to sell our common stock and may affect your ability
to resell our common stock.
Many
brokerage firms will discourage or refrain from recommending investments in penny stocks. Most institutional investors will not
invest in penny stocks. In addition, many individual investors will not invest in penny stocks due, among other reasons, to the
increased financial risk generally associated with these investments.
For
these reasons, penny stocks may have a limited market and, consequently, limited liquidity. We can give no assurance that our
common stock will not remain classified as a “penny stock” in the future.
If
we fail to maintain effective internal control over financial reporting, the price of our securities may be adversely affected.
Our
internal control over financial reporting may have weaknesses and conditions that could require correction or remediation, the
disclosure of which may have an adverse impact on the price of our common stock. We are required to establish and maintain appropriate
internal control over financial reporting. Failure to establish those controls, or any failure of those controls once established,
could adversely affect our public disclosures regarding our business, prospects, financial condition or results of operations.
In addition, management’s assessment of internal control over financial reporting may identify weaknesses and conditions
that need to be addressed in our internal control over financial reporting or other matters that may raise concerns for investors.
Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial reporting or
disclosure of management’s assessment of our internal control over financial reporting may have an adverse impact on the
price of our common stock.
We
are required to comply with certain provisions of Section 404 of the Sarbanes-Oxley Act and if we fail to continue to comply,
our business could be harmed and the price of our securities could decline.
Rules
adopted by the SEC pursuant to Section 404 of the Sarbanes-Oxley Act require an annual assessment of internal control over financial
reporting, and for certain issuers (but not us) an attestation of this assessment by the issuer’s independent registered
public accounting firm. The standards that must be met for management to assess the internal control over financial reporting
as effective are evolving and complex, and require significant documentation, testing, and possible remediation to meet the detailed
standards. We expect to incur significant expenses and to devote resources to Section 404 compliance on an ongoing basis. It is
difficult for us to predict how long it will take or costly it will be to complete the assessment of the effectiveness of our
internal control over financial reporting for each year and to remediate any deficiencies in our internal control over financial
reporting. As a result, we may not be able to complete the assessment and remediation process on a timely basis. In the event
that our Chief Executive Officer or Chief Financial Officer determines that our internal control over financial reporting is not
effective as defined under Section 404, we cannot predict how regulators will react or how the market prices of our securities
will be affected; however, we believe that there is a risk that investor confidence and the market value of our securities may
be negatively affected.
Our
Chief Executive Officer has voting control, which will limit your ability to influence the outcome of important transactions,
including a change in control.
As
of August 10 , 2017, Mr. Mathieson beneficially owned 6,900,000 shares of our common stock, which represents 54.1% of our
outstanding common stock. As a result, Mr. Mathieson controls a majority of our voting power and therefore is able to control
all matters submitted to our stockholders for approval. Mr. Mathieson may have interests that differ from yours and may vote in
a way with which you disagree and which may be adverse to your interests. This concentrated voting power may have the effect of
delaying, preventing or deterring a change in control of our company, could deprive our stockholders of an opportunity to receive
a premium for their capital stock as part of a sale of our company and might ultimately affect the market price of our common
stock.
As
a board member, Mr. Mathieson owes a fiduciary duty to our stockholders and must act in good faith and in a manner he reasonably
believes to be in the best interests of our stockholders. As a stockholder, Mr. Mathieson is entitled to vote his shares in his
own interest, which may not always be in the interests of our stockholders generally.
Shares
eligible for future sale may adversely affect the market.
From
time to time, certain of our stockholders may be eligible to sell all or some of their shares of common stock by means of ordinary
brokerage transactions in the open market pursuant to Rule 144 promulgated under the Securities Act, subject to certain limitations.
In general, pursuant to Rule 144, non-affiliate stockholders may sell freely after six months, subject only to the current public
information requirement. Affiliates may sell after six months, subject to the Rule 144 volume, manner of sale (for equity securities),
current public information, and notice requirements. Of the approximately 12,754,066 shares of our common stock outstanding as
of August 10, 2017, approximately 5,852,066 shares are tradable without restriction. Given the limited trading of our common
stock, resale of even a small number of shares of our common stock pursuant to Rule 144 or an effective registration statement
may adversely affect the market price of our common stock.
Provisions
of our amended and restated articles of incorporation and amended and restated bylaws may delay or prevent a takeover which may
not be in the best interests of our stockholders.
Provisions
of our amended and restated articles of incorporation, as amended, and our amended and restated bylaws may be deemed to have anti-takeover
effects, which include when and by whom special meetings of our stockholders may be called, and may delay, defer or prevent a
takeover attempt. In addition, certain provisions of the Florida Business Corporations Act also may be deemed to have certain
anti-takeover effects which include that control of shares acquired in excess of certain specified thresholds will not possess
any voting rights unless these voting rights are approved by a majority of a corporation’s disinterested stockholders. Further,
our amended and restated articles of incorporation, as amended, authorize the issuance of up to 50,000,000 shares of preferred
stock with such rights and preferences as may be determined from time to time by our board of directors in their sole discretion.
Our board of directors may, without stockholder approval, issue series of preferred stock with dividends, liquidation, conversion,
voting or other rights that could adversely affect the voting power or other rights of the holders of our common stock.
As
an “emerging growth company” under the JOBS Act, we are permitted to rely on exemptions from certain disclosure requirements.
We
qualify as an “emerging growth company” under the JOBS Act. As a result, we are permitted to, and intend to, rely
on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required
to:
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have
an auditor report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
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comply
with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation
or a supplement to the auditor’s report providing additional information about the audit and the consolidated financial
statements (i.e., an auditor discussion and analysis);
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submit
certain executive compensation matters to stockholder advisory votes, such as “say-on-pay” and “say-on-frequency”;
and
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disclose
certain executive compensation related items such as the correlation between executive compensation and performance and comparisons
of the chief executive officer’s compensation to median employee compensation.
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In
addition, Section 102 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition
period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words,
an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply
to private companies. We have elected to take advantage of the benefits of this extended transition period. Our consolidated financial
statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
We
will remain an “emerging growth company” for up to five years, or until the earliest of (i) the last day of the first
fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a “large accelerated
filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our ordinary shares that
is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter
or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
Until
such time, however, we cannot predict if investors will find our common stock less attractive because we may rely on these exemptions.
If some investors find our common stock less attractive as a result, there may be a less active trading market for our common
stock and the price of our securities may be more volatile.
USE
OF PROCEEDS
We
will not receive any proceeds from the sale of common stock by the selling stockholders in this offering. See “Selling Stockholders.”
DETERMINATION
OF OFFERING PRICE
The
shares being offered by the selling stockholders will be sold at a fixed price of $3.00 for the duration of this offering.
The offering price of the shares bears no relation to book value, assets, earnings, or any other objective criteria of value.
It has been arbitrarily determined by the selling stockholders.
PLAN
OF DISTRIBUTION
This
prospectus relates to 9,089,220 shares of our common stock offered by the selling stockholders. The selling stockholders and any
of their respective pledges, donees, assignees and other successors-in-interest may, from time to time, sell any or all of their
shares of common stock on any stock exchange, market or trading facility on which the shares are traded or in private transactions.
These
shares shall be sold at a fixed price of $3.00 for the duration of this offering. The offering price of the shares bears
no relation to book value, assets, earnings, or any other objective criteria of value. It has been arbitrarily determined by the
selling stockholders. The selling stockholders may use any one or more of the following methods when selling shares:
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ordinary
brokerage transactions and transactions in which the broker-dealer solicits purchasers;
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block
trades in which the broker-dealer will attempt to sell the shares as agent, but may position and resell a portion of the block
as principal to facilitate the transaction;
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purchases
by a broker-dealer as principal and resale by the broker-dealer for its account;
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an
exchange distribution in accordance with the rules of the applicable exchange;
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privately
negotiated transactions;
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short
sales;
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broker-dealers
may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share;
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through
the writing of options on the shares;
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a
combination of any such methods of sale; and
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any
other method permitted pursuant to applicable law.
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The
selling stockholders or any of their respective pledgees, donees, transferees or other successors-in-interest, may also sell the
shares directly to market makers acting as principals and/or broker-dealers acting as agents for themselves or their customers.
Such broker-dealers may receive compensation in the form of discounts, concessions or commissions from the selling stockholders
and/or the purchasers of shares for whom such broker-dealers may act as agents or to whom they sell as principal or both, which
compensation as to a particular broker-dealer might be in excess of customary commissions. Before any such agent, or broker-dealer
sells any of the shares that are the subject of this prospectus, a post-effective amendment to the registration statement of which
this prospectus forms a part will be filed to name anyone receiving compensation for selling the shares before any sales take
place. Market makers and block purchasers purchasing the shares will do so for their own account and at their own risk. It is
possible that a selling stockholder will attempt to sell shares of common stock in block transactions to market makers or other
purchasers at a fixed price which may be below or above the then market price. The selling stockholders and any brokers, dealers
or agents, upon effecting the sale of any of the shares offered in this prospectus, are “underwriters” as that term
is defined under the Securities Act, or the Exchange Act or the rules and regulations under such acts. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act.
Discounts,
concessions, commissions and similar selling expenses, if any, attributable to the sale of shares will be borne by the respective
selling stockholder. A selling stockholder may agree to indemnify any agent, dealer or broker-dealer that participates in transactions
involving sales of the shares if liabilities are imposed on that person under the Securities Act.
The
selling stockholders may from time to time pledge or grant a security interest in some or all of the shares of common stock owned
by them and, if a selling stockholder defaults in the performance of its secured obligations, the pledgee or secured parties may
offer and sell the shares of common stock from time to time under this prospectus after we have filed an amendment to this prospectus
under Rule 424(b)(3) or any other applicable provision of the Securities Act amending the list of selling stockholders to include
the pledgee, transferee or other successors-in-interest as selling stockholders under this prospectus.
The
selling stockholders also may transfer their shares of common stock in other circumstances, in which case the transferees, pledgees
or other successors-in-interest will be the selling beneficial owners for purposes of this prospectus and may sell the shares
of common stock from time to time under this prospectus after we have filed an amendment to this prospectus under Rule 424(b)(3)
or other applicable provision of the Securities Act amending the list of selling stockholders to include the pledgee, transferee
or other successors-in-interest as selling stockholders under this prospectus.
We
are required to pay all fees and expenses incident to the registration of the shares of common stock. We have agreed to indemnify
the selling stockholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.
The
selling stockholders acquired the securities offered hereby in the ordinary course of business and have advised us that they have
not entered into any agreements, understandings or arrangements with any underwriters or broker-dealers regarding the sale of
their shares of common stock, nor is there an underwriter or coordinating broker acting in connection with a proposed sale of
shares of common stock by any selling stockholder. If we are notified by any selling stockholder that any material arrangement
has been entered into with a broker-dealer for the sale of shares of common stock, if required, we will file a supplement to this
prospectus.
If
a selling stockholder uses this prospectus for any sale of the shares of common stock, it will be subject to the prospectus delivery
requirements of the Securities Act.
The
anti-manipulation rules of Regulation M under the Securities Exchange Act may apply to sales of our common stock and activities
of the selling stockholders.
DIVIDEND
POLICY
Historically,
we have not paid any cash dividends on our common stock. In May 2017, we announced the declaration of a cash dividend of $0.005
per common share for the first quarter of 2017. The dividend is payable on August 21, 2017 to stockholders of record at the close
of business on June 5, 2017. In addition, in August 2017, we announced the declaration of a cash dividend of $0.005 per common
share for the second quarter of 2017. The dividend is payable on August 21, 2017 to stockholders of record at the close of business
on August 11, 2017. We expect to pay ongoing quarterly dividends. Payment of future dividends on our common stock, if any, will
be at the discretion of our board of directors and will depend on, among other things, our results of operations, cash requirements
and surplus, financial condition, contractual restrictions and other factors that our board of directors may deem relevant. We
may determine to retain future earnings, if any, for reinvestment in the development and expansion of our business.
MARKET
PRICE FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Market
Information
Our
common stock is currently quoted on the OTCQB tier of the OTC Markets under the symbol “IEGH.” The OTC Market is a
network of security dealers who buy and sell stock. The dealers are connected by a computer network that provides information
on current “bids” and “asks”, as well as volume information.
The
following table sets forth the range of high and low closing bid quotations for our common stock for each of the periods indicated
as reported by the OTC Markets. These quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission
and may not necessarily represent actual transactions. As of June 17, 2015, we effected a 1-for-100 reverse stock split of our
outstanding shares. We also completed a 1-for-100 reverse stock split and a 100-for-1 forward stock split, both effective March
28, 2016, and a net 1-for-10 reverse stock split effective October 27, 2016. All prices in the following table reflect post- split
prices.
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High
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Low
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2014
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Quarter
Ended March 31, 2014
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$
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100.00
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$
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100.00
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Quarter
Ended June 30, 2014
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120.00
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100.00
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Quarter
Ended September 30, 2014
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450.00
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100.00
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Quarter
Ended December 31, 2014
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1,000.00
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100.00
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2015
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Quarter
Ended March 31, 2015
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$
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510.00
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$
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387.50
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Quarter
Ended June 30, 2015
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550.00
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250.00
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Quarter
Ended September 30, 2015
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275.00
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80.00
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Quarter
Ended December 31, 2015
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100.00
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74.90
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2016
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Quarter
Ended March 31, 2016
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$
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99.00
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$
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49.50
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Quarter
Ended June 30, 2016
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65.00
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17.50
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Quarter
Ended September 30, 2016
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24.00
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16.60
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Quarter
Ended December 31, 2016
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7.50
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2.01
|
|
|
|
|
|
|
|
|
|
|
2017
|
|
|
|
|
|
|
|
|
Quarter
Ended March 31, 2017
|
|
$
|
7.50
|
|
|
$
|
1.05
|
|
Quarter
Ended June 30, 2017
|
|
|
4.19
|
|
|
|
0.75
|
|
On
August 10, 2017, the closing price for our common stock on the OTCQB was $0.6999 per share.
Our shares are
thinly traded on the OTC Markets and therefore, we do not believe the prices represent a reliable indication of the fair market
value of these shares. We sold shares of common stock in private placements during 2014 at prices ranging from $5.00 per share
to $20.00 per share, during 2015 at prices ranging from $10.00 per share to $50.00 per share, and in 2016 at prices ranging from
$10.00 to $50.00 per share.
Holders
of Common Stock
As of August 10,
2017, there were approximately 659
record
holders of our common stock. The number of record holders does not include beneficial owners of common stock whose shares are
held in the names of banks, brokers, nominees or other fiduciaries.
We
have no securities authorized for issuance under equity compensation plans.
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND
RESULTS OF OPERATIONS
The
following discussion of our financial condition and results of operations should be read in conjunction with the consolidated
financial statements and the Notes to those financial statements that are included elsewhere in this prospectus. Our discussion
includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives,
expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking
statements as a result of a number of factors, including those set forth under the Risk Factors, Cautionary Statement Regarding
Forward-Looking Statements and Business sections in this prospectus. We use words such as “anticipate,” “estimate,”
“plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,”
“intend,” “may,” “will,” “should,” “could,” and similar expressions
to identify forward-looking statements.
Overview
We are a consumer finance
company providing responsible online personal loan products to customers in 20 states via our website and online application portal.
We provide unsecured loans to individuals. Our $5,000 and $10,000 online personal loans range from 19.9% to 29.9% APR and all
are unsecured over a five-year term. We have a 6.5-year track record of origination, underwriting and servicing of personal loans
to underbanked consumers. We leverage our experience and knowledge in the consumer finance industry to achieve a meaningful return
on our investment in the loan portfolio. We may refer to IEG Holdings Corporation (“IEG Holdings”), collectively
with its wholly-owned subsidiaries, Investment Evolution Corporation (“IEC”) and IEC SPV, LLC (“IEC SPV”)
as the “Company”.
We
have the ability to finance our businesses from a diversified source of capital and funding, including financings in the capital
markets. During 2016, we demonstrated the ability to attract capital markets funding for our core personal loans by completing
private placements of common stock and preferred stock.
We
operate in one business segment: Consumer Loans.
Recent
Developments
LendingClub Corporation Tender Offer
On
July 12, 2017, the Company filed a registration statement on Form S-4 (the “S-4 Registration Statement”) and a Schedule
TO relating to the Company’s offer to exchange four shares of the Company’s common stock for each share of common
stock of LendingClub Corporation (“Lending Club”), par value $0.01 per share, up to an aggregate of 40,345,603 shares
of Lending Club common stock, representing approximately 9.99% of Lending Club’s outstanding shares as of April 28, 2017,
validly tendered and not properly withdrawn in the offer (the “Lending Club Tender Offer”). The Lending Club Tender
Offer and the withdrawal rights were set to expire at 5:00 p.m., Eastern time, on August 10, 2017, unless extended.
Following
the launch of the Lending Club Tender Offer, the Company’s per share stock price, as quoted on the OTCQB, dropped significantly.
On August 1, 2017, due to the stock price drop, the Company determined that the Lending Club Tender Offer no longer had a reasonable
chance of success and accordingly, the Company determined that it would terminate the Lending Club Tender Offer and withdraw the
S-4 Registration Statement. Furthermore, the Company has no intention of launching the Lending Club Tender Offer or another tender
offer in the near future. Any shares that have been tendered by Lending Club stockholders have not yet been accepted and will
be returned to the relevant stockholders.
Abandonment
of Reverse-Forward Stock Split and Cash-Out
On
June 21, 2017, the Company filed with the Securities and Exchange Commission (the “Commission”) a preliminary information
statement on Schedule 14C (the “Preliminary Information Statement”). The Preliminary Information Statement, though
not in definitive form, related to a vote by the Company’s sole director and holder of a majority of the voting power of
the issued and outstanding capital stock of the Company to effect a reverse 1-for-1,000 stock split (the “Reverse Split”),
followed immediately by a forward 1,000-for-1 stock split (the “Forward Split”) of the Company’s common stock.
The Company’s intention was that registered shareholders whose shares of stock were converted into less than one share in
the Reverse Split would receive cash payments equal to the fair value of those fractional interests. The Reverse Split and Forward
Split, together with the related cash payments to shareholders with less than 1,000 shares of common stock prior to the Reverse
Split are referred to herein as the “Reverse/Forward Split.”
On
July 18, 2017, the Company determined that it will not effect the Reverse/Forward Split at this time. Furthermore, the Company
has no intention of effecting the Reverse/Forward Split or any other reverse and/or forward split in the near future. For avoidance
of doubt, no reverse and/or forward split occurred on July 25, 2017, as originally disclosed in the Preliminary Information Statement,
and no stockholders were cashed out on July 25, 2017. Stockholders should disregard the Preliminary Information Statement that
was filed with the Commission in its entirety.
The
Company’s determination to abandon the Reverse/Forward Split was based on the Company’s launch, on July 12, 2017,
of the Lending Club Tender Offer. The Company launched the Lending Club Tender Offer on July 12, 2017, subsequent to the filing
of the Preliminary Information Statement with the Commission on June 21, 2017. The primary goal of the Reverse/Forward Split was
cost savings from reducing administrative costs associated with reducing shareholder accounts. The Company expected that a significant
number of new shareholders may have been obtained in connection with the Lending Club Tender Offer, including those holding fewer
than 1,000 shares. As a result, the Company determined that any expected cost savings may no longer be sufficient to justify proceeding
with the Reverse/Forward Split. Although the Company determined, on August 1, 2017, that it would abandon the Lending Club Tender
Offer, the Company does not intend to effect the Reverse/Forward Split or any other reverse and/or forward split in the near future.
The Company notes that previously completed reverse/forward stock splits have achieved substantial administrative cost savings,
and have not been designed for the purpose of “going private”.
Stock
Repurchase Program
In
January 2017, our Board of Directors approved a stock repurchase program authorizing the open market repurchase of up to $2,000,000
of our common stock for the following reasons:
|
●
|
The
stock repurchase program permits the Company to purchase shares of its common stock from time to time at prices that are below
what the Board believes to be the true value of the shares.
|
|
|
|
|
●
|
The
Company’s common stock is trading at close to record low prices.
|
|
●
|
The
stock repurchase program reflects the commitment of our Board of Directors to enhance stockholder value and its confidence
in our long-term growth prospects.
|
|
|
|
|
●
|
The
Board believes the stock repurchase program is a strategic investment and an appropriate use of corporate funds.
|
|
|
|
|
●
|
Any
repurchases will only be effected to the extent that they do not impair the Company’s capital or the Company’s
ability to pay its debts.
|
|
|
|
|
●
|
The
Company has available liquidity from existing customer loan repayments to be able to both reinvest in new customer loans and
also to strategically invest back into our company via stock repurchases.
|
|
|
|
|
●
|
The
stock repurchase program will assist in improving stock liquidity and ensuring a more orderly and less volatile market for
a relatively small outlay of cash.
|
|
|
|
|
●
|
No
purchases are required and the $2,000,000 cap on the stock repurchase program is relatively low.
|
Purchases under the
program are authorized through December 31, 2017. Through August 10, 2017, an aggregate of 170,998 shares have been repurchased
under this program for an aggregate purchase price of $100,861.60.
Declaration
of Dividend
On
August 1, 2017, our sole director declared a cash dividend of $0.005 per common share for the second quarter of 2017. The dividend
is payable on August 21, 2017 to stockholders of record at the close of business on August 11, 2017.
Notes
Offering Terminated
In
December 2016, we launched a private offering of up to $10 million aggregate principal amount of our 12% senior unsecured notes
due December 31, 2026 (the “Notes”), on a self-underwritten basis. The Notes offering was terminated in May 2017.
No Notes were sold in the offering.
OneMain
Holdings, Inc. Tender Offer Closed
On
June 16, 2017, we closed our tender offer to purchase shares of common stock of OneMain Holdings, Inc. (“OneMain”),
with 151,994 OneMain shares of common stock acquired (valued at an aggregate of $3.55 million based on the closing price of shares
of OneMain common stock of $23.38 on June 15, 2017) in exchange for 3,039,880 shares of our common stock. The per share valuation
of IEG Holdings shares used in connection with the OneMain tender offer was $1.169 per IEG Holdings common share as at the close
date of the tender offer. On June 22, 2017, we sold 100% of the 151,994 shares of OneMain common stock which we obtained in our
tender offer for $3.4 million in cash. The current planned use of the proceeds from the sale of OneMain shares is to fund increased
new loan volumes in Q3 and a further use is to fund the payables to Mr. Mathieson pursuant to the terms of the consulting agreement
entered into on July 1, 2017.
Amendment
of Series H Preferred Stock
On
June 20, 2017, we filed articles of amendment (the “Amendment”) to our amended and restated articles of incorporation,
as amended (the “Articles”). The Amendment has the effect of revising the terms of the Series H preferred stock to:
|
(1)
|
remove
rights to receive dividends on our Series H preferred stock;
|
|
|
|
|
(2)
|
increase
the conversion ratio of the Series H preferred stock from 0.2 shares of Common Stock per share of Series H preferred stock
to 1 share of Common Stock per share of Series H preferred stock;
|
|
|
|
|
(3)
|
remove
our right to redeem or call our Series H preferred stock;
|
|
|
|
|
(4)
|
provide
for automatic conversion of Series H preferred stock into shares of our Common Stock on December 31, 2017; and
|
|
|
|
|
(5)
|
remove
the voting rights for Series H preferred stock.
|
The
Amendment was approved by our board of directors on June 19, 2017.
In
addition, on July 26, 2017, we filed articles of amendment to our Articles that had the effect of revising the terms of the Series
H preferred stock to increase the conversion ratio of the Series H preferred stock from one share of common stock per share of
Series H preferred stock to four shares of common stock per share of Series H preferred stock. The Articles amendment was approved
by our sole director on July 26, 2017.
Six
Months Ended June 30, 2017 Compared to Six Months Ended June 30, 2016
Interest
Revenue
For
the six months ended June 30, 2017, interest revenue decreased to $851,715, compared to $1,039,172 for the six months ended June
30, 2016. This decrease was due to the decreased average interest-earning loan book size of consumer receivables during the period.
Other
Revenue
For
the six months ended June 30, 2017, other revenue decreased slightly to $29,609, compared to $31,156 for the six months ended
June 30, 2016. Other revenue consisted of declined lead revenue and loss recovery. The slight decrease was attributable to a slight
decrease in declined lead revenue.
Salaries
and Compensation Expenses
For
the six months ended June 30, 2017, salaries and compensation expenses decreased to $239,203, compared to $809,329 for the six
months ended June 30, 2016. The decrease was primarily attributable to the decrease in the CEO’s annual base salary to $1
effective January 1, 2017.
Other
Operating Expenses
For
the six months ended June 30, 2017, other operating expenses decreased to $194,566, compared to $388,137 for the six months ended
June 30, 2016. The decrease was attributable to the lower underwriting costs and client service costs due to reduced new loan
volume in the current period.
Provision
for Credit Losses
For
the six months ended June 30, 2017, the provision for credit losses expense decreased to $619,324, compared to $742,437 for the
six months ended June 30, 2016. We carry a provision for credit losses which is estimated collectively based on our loan portfolio
and general economic conditions. The decrease in provision for credit losses from the prior year period was due to the decrease
in our loan portfolio as of June 30, 2017.
Advertising
For
the six months ended June 30, 2017, advertising expenses decreased to $3,460, compared to $221,309 for the six months ended June
30, 2016. The decrease was attributable to the reduction in customer acquisition costs incurred, including online advertising,
direct mail, and lead generation costs in the current period.
Rent
Expense
For
the six months ended June 30, 2017, rent expense decreased to $28,889, compared to $107,465 for the six months ended June 30,
2016. The decrease was due to termination of Florida, Illinois and Arizona leases in 2016.
Public
Company and Corporate Finance Expenses
For
the six months ended June 30, 2017, public company and corporate finance expenses increased to $1,195,535, compared to $1,010,779
for the six months ended June 30, 2016. The increase was due to the significant one-off costs incurred related to the OneMain
tender offer net of the decrease in investor/financing costs incurred resulting from no capital raises in the six months ended
June 30, 2017.
Depreciation
and Amortization
For
the six months ended June 30, 2017, depreciation and amortization marginally decreased to $3,044, compared to $3,833 for the six
months ended June 30, 2016. The minimal movement was in line with expectations.
Three
Months Ended June 30, 2017 Compared to Three Months Ended June 30, 2016
Interest
Revenue
For
the three months ended June 30, 2017, interest revenue decreased to $400,986, compared to $526,380 for the three months ended
June 30, 2016. This decrease was due to the decreased average interest-earning loan book size of consumer receivables during the
period.
Other
Revenue
For
the three months ended June 30, 2017, other revenue decreased to $12,955, compared to $18,976 for the three months ended June
30, 2016. Other revenue consisted of declined lead revenue and loss recovery. The decrease was attributable to a decrease in declined
lead revenue.
Salaries
and Compensation Expenses
For
the three months ended June 30, 2017, salaries and compensation expenses decreased to $118,925, compared to $406,323 for the three
months ended June 30, 2016. The decrease was primarily attributable to the decrease in the CEO’s annual base salary to $1
effective January 1, 2017.
Other
Operating Expenses
For
the three months ended June 30, 2017, other operating expenses decreased to $79,362, compared to $206,610 for the three months
ended June 30, 2016. The decrease was attributable to the lower underwriting costs and client service costs due to reduced new
loan volume in the current period.
Provision
for Credit Losses
For
the three months ended June 30, 2017, the provision for credit losses expense increased to $394,836, compared to $354,918 for
the three months ended June 30, 2016. We carry a provision for credit losses which is estimated collectively based on our loan
portfolio and general economic conditions. The increase in provision for credit losses from the prior year period was due to higher
loan write-offs versus the comparable period.
Advertising
For
the three months ended June 30, 2017, advertising expenses decreased to $2,580, compared to $173,485 for the three months ended
June 30, 2016. The decrease was attributable to the reduction in customer acquisition costs incurred, including online advertising,
direct mail, and lead generation costs in the current period.
Rent
Expense
For
the three months ended June 30, 2017, rent expense decreased to $18,032, compared to $52,778 for the three months ended June 30,
2016. The decrease was due to termination of Florida, Illinois and Arizona leases in 2016.
Public
Company and Corporate Finance Expenses
For
the three months ended June 30, 2017, public company and corporate finance expenses increased to $697,344, compared to $600,530
for the three months ended June 30, 2016. The increase was due to the significant one-off costs incurred related to the OneMain
tender offer net of the decrease in investor/financing costs incurred resulting from no capital raises in the three months ended
June 30, 2017.
Depreciation
and Amortization
For
the three months ended June 30, 2017, depreciation and amortization marginally decreased to $1,471, compared to $1,917 for the
three months ended June 30, 2016. The minimal movement was in line with expectations.
Financial
Position
Cash
and Cash Equivalents
We
had cash and cash equivalents of $3,743,268 as of June 30, 2017, compared to $322,441 as of December 31, 2016. The increase was
due to less net cash used in operating activities due to operational cost cuts and higher net cash provided by investing activities
due to the sale of OneMain marketable securities and less loans receivable originated.
Loans
Receivable
We
had net loan receivables of $5,055,063 as of June 30, 2017, as compared to $6,374,908 as of December 31, 2016. The decrease was
due to lower loan originations in the current period versus repayment of loan principal by customers.
Other
Receivables
We
had other receivables of $60,480 as of June 30, 2017, as compared to $84,851 as of December 31, 2016. Other receivables was comprised
of outstanding invoices for declined lead revenue due from marketing partners and accrued interest receivable on our consumer
loans at June 30, 2017. The decrease in other receivables is primarily due to the decrease in accrued interest receivable for
the current period.
Property
and Equipment
We
had net property and equipment of $16,278 as of June 30, 2017 as compared to $19,322 as of December 31, 2016. The minimal movement
was in line with expectations and a direct result of recording depreciation expense for the current period.
Accounts
Payable and Accrued Expenses
We
had accounts payable and accrued expenses of $66,431 as of June 30, 2017, compared to $1,060 as of December 31, 2016. The increase
was due to management’s decision to delay payment of a number of June expenses in full in the current period so accrual
was required for those expenses.
For
the year ended December 31, 2016 compared to December 31, 2015
|
|
Year
Ended
December 31, 2016
|
|
|
Year
Ended
December 31, 2015
|
|
REVENUES
|
|
|
|
|
|
|
|
|
Interest
revenue
|
|
$
|
2,086,976
|
|
|
$
|
1,789,701
|
|
Other
revenue
|
|
|
48,070
|
|
|
|
45,464
|
|
TOTAL
REVENUES
|
|
|
2,135,046
|
|
|
|
1,835,165
|
|
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and compensation
|
|
|
1,592,990
|
|
|
|
2,126,243
|
|
Other operating
expenses
|
|
|
1,561,045
|
|
|
|
1,399,157
|
|
Consulting
|
|
|
1,154,465
|
|
|
|
1,013,690
|
|
Provision for credit
losses
|
|
|
1,865,362
|
|
|
|
1,134,518
|
|
Advertising
|
|
|
373,350
|
|
|
|
950,905
|
|
Rent
|
|
|
178,678
|
|
|
|
244,621
|
|
Travel, meals and
entertainment
|
|
|
141,686
|
|
|
|
129,351
|
|
Depreciation
and amortization
|
|
|
8,618
|
|
|
|
14,124
|
|
TOTAL
OPERATING EXPENSES
|
|
|
6,876,194
|
|
|
|
7,012,609
|
|
LOSS
FROM OPERATIONS
|
|
|
(4,741,147
|
)
|
|
|
(5,177,444
|
)
|
OTHER INCOME (EXPENSE)
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
-
|
|
|
|
(527,921
|
)
|
Miscellaneous
income (expense)
|
|
|
12,278
|
|
|
|
7,167
|
|
TOTAL
OTHER INCOME (EXPENSE)
|
|
|
12,278
|
|
|
|
(520,754
|
)
|
NET LOSS
|
|
$
|
(4,728,869
|
)
|
|
$
|
(5,698,198
|
)
|
Interest
Revenue
For
the year ended December 31, 2016, interest revenue increased to $2,086,976, compared to $1,789,701 for the year ended December
31, 2015. This increase was due to the increased average interest-earning loan book size of consumer receivables during the period.
Other
Revenue
For
the year ended December 31, 2016, other revenue increased to $48,070, compared to $45,464 for the year ended December 31, 2015.
Other revenue consisted of decline lead revenue, late/dishonor fees, loss recovery and stock application/processing fees. The
increase was attributable to an increase in loss recovery.
Salaries
and Compensation Expenses
For
the year ended December 31, 2016, salaries and compensation expenses decreased to $1,592,990, compared to $2,126,243 for the year
ended December 31, 2015. The decrease was primarily attributable to the cessation of employment for our VP Corporate Finance and
zero bonus payments to our CEO in 2016.
Other
Operating Expenses
For
the year ended December 31, 2016, other operating expenses increased to $1,561,045, compared to $1,399,157 for the year ended
December 31, 2015. The increase was attributable to the higher legal, accounting and SEC fees associated with our multiple SEC
filings in the period.
Consulting
Fees
For
the year ended December 31, 2016, consulting fees increased to $1,154,465, compared to $1,013,690 for the year ended December
31, 2015. The increase was attributable to the increase in independent research and investor relations consulting costs in the
period.
Provision
for Credit Losses
For
the year ended December 31, 2016, the provision for credit losses expense increased to $1,865,362, compared to $1,134,518 for
the year ended December 31, 2015. We carry a provision for credit losses which is estimated collectively based on our loan portfolio
and general economic conditions. The increase in provision for credit losses from year ended December 31, 2015 was due to the
increase in loans charged off during the first and last quarters of 2016.
Advertising
For
the year ended December 31, 2016, advertising expenses decreased to $373,350, compared to $950,905 for the year ended December
31, 2015. This decrease is attributable to the reduction in customer acquisition costs incurred, including online advertising,
direct mail, and lead generation costs.
Rent
Expense
For
the year ended December 31, 2016, rent expense decreased to $178,678, compared to $244,621 for the year ended December 31, 2015.
The decrease was due to reduced relocation costs and termination of Florida, Illinois and Arizona leases.
Travel,
Meals and Entertainment
For
the year ended December 31, 2016, travel, meals and entertainment expenses increased to $141,686, compared to $129,351 for the
year ended December 31, 2015. Travel, meals and entertainment expenses include corporate travel for meetings and investor presentations,
as well as other investor related expenses. The increase was due to the significant increase in investor roadshows conducted by
the CEO in the period compared to the previous period.
Depreciation
and Amortization
For
the year ended December 31, 2016, depreciation and amortization decreased to $8,618, compared to $14,124 for the year ended December
31, 2015. The minimal movement was in line with expectations.
Interest
Expense
For
the year ended December 31, 2016, interest expense decreased to $0, compared to $527,921 for the year ended December 31, 2015.
The decrease was due to the full repayment of the BFG senior debt facility in 2015.
Financial
Position
Cash
and Cash Equivalents
We
had cash and cash equivalents of $322,441 as of December 31, 2016, compared to $485,559 as of December 31, 2015. The decrease
was due to reduced equity capital raised in the period.
Loans
Receivable
We
had net loan receivables of $6,374,908 as of December 31, 2016, as compared to $7,124,702 as of December 31, 2015. The decrease
was due to lower loan originations, higher loan receivables repaid and higher loan charge offs.
Other
Receivables
We
had other receivables of $84,851 as of December 31, 2016, as compared to $76,262 as of December 31, 2015. Other receivables comprised
outstanding invoices for decline lead revenue due from marketing partners and accrued interest receivable on our consumer loans
at December 31, 2016. The increase is primarily due to an increase in accrued interest receivable.
Property
and Equipment
We
had net property and equipment of $19,322 as of December 31, 2016, as compared to $28,511 as of December 31, 2015. The decrease
was a direct result of recording depreciation expense for the period plus a loss of $571 on disposal of assets.
Security
Deposits
We
had security deposits of $7,470 as of December 31, 2016, as compared to $35,839 as of December 31, 2015. The decrease was due
to primarily due to refund of security deposits upon termination of Florida, Illinois and Arizona leases.
Accounts
Payable and Accrued Expenses
We
had accounts payable and accrued expenses of $1,060 as of December 31, 2016, compared to $96,441 as of December 31, 2015. The
decrease was due to management’s decision to pay a number of December expenses in full in the current period so accrual
was not required for those expenses.
Deferred
Rent
We
had deferred rent of $0 as of December 31, 2016, compared to $11,522 as of December 31, 2015. The decrease was due to removal
of all deferred rent via termination of Florida, Illinois and Arizona leases and 12 month renewal of Nevada lease.
Financial
Condition, Liquidity and Capital Resources
During
the six months ended June 30 , 2017 and the twelve months ended December 31, 2016, we incurred operating expenses
in excess of net revenue. However, anticipated cash flow from our existing loan receivable repayments plus net revenue are expected
to exceed budgeted cash operating expenses for the next 12 months. To expand operations we will require capital infusions until
operating results improve. We may not be able to obtain such capital in a timely manner and as a result may incur liquidity imbalances.
Liquidity
and Capital Resources
Six
Months Ended June 30, 2017 Compared to Six Months Ended June 30, 2016
We
used cash in operations of $679,799 during the six months ended June 30, 2017, compared to $1,293,403 during the six months ended
June 30, 2016, and this decrease is due to a substantial reduction in net losses due to significant operational cost cuts. The
major operational cost cut in the six month period was the decrease in the CEO’s annual base salary to $1 effective January
1, 2017. The Company incurred $682,934 of costs during the six months ended June 30, 2017 in connection with the OneMain tender
offer and the Company incurred $12,494 of costs during the six months ended June 30, 2017 in connection with the LendingClub tender
offer .
We
were provided with net cash from investing activities of $4,100,626 during the six months ended June 30, 2017, compared to $1,319,112
used in investing activities during the six months ended June 30, 2016. The increase in cash provided by investing activities
is primarily due to a decrease in loans receivable originated and the sale of all OneMain shares acquired in the OneMain tender
offer.
We
were provided $0 of net cash from financing activities during the six months ended June 30, 2017, compared to $2,301,036 during
the same period in 2016. The decrease was attributable to the absence of any debt or equity capital raising proceeds compared
to significant proceeds from a common stock capital raising received in the corresponding period in 2016.
At
June 30, 2017, we had cash on hand of $3,743,268, which when added to budgeted cash inflows from loans receivable repaid and budgeted
cash inflows from revenues, is sufficient to meet our operating needs for the next 12 months.
The
principal conditions/events that raise substantial doubt about the company’s ability to meet its obligations are i) the
Company has reported recurring losses and ii) the Company has not yet generated positive net cash flows from operations. However,
the Company has reduced its core operating expenses. In addition, cash in bank significantly increased during the quarter, resulting
from substantial positive net cash flows from investing activities. Management has evaluated the result of their plans for the
next 12 months and as a result of the plans, the Company can meet all its obligations at least through August 2018. However, the
Company intends, over the next 12 months, to seek additional capital to expand operations.
On August 21, 2015, we,
through certain of our wholly owned subsidiaries, repaid the entire balance of principal and accrued interest under the Loan Agreement
among BFG and certain of our wholly owned subsidiaries. As a result, there is currently no outstanding balance under the
Loan Agreement. However, the Loan Agreement continues in effect and we are subject to a net profit interest under which we are
required to pay BFG 20% of the “Net Profit” of its subsidiary, IEC SPV, until 10 years from the date the loan is repaid
in full (August 2015). Net Profit is defined as the gross revenue less (i) interest paid on the loan, (ii) payments on any other
debt incurred as a result of refinancing the loan through a third party, as provided in the Loan Agreement, (iii) any costs, fees
or commissions paid on the existing credit facility, and (iv) charge-offs to bad debt resulting from consumer loans and reduced
by servicing fee. The Net Profit arrangement can be terminated by us upon a payment of $3,000,000 to BFG. Net profit interest
for the six months ended June 30, 2017 and 2016 were $0 and $58,885, respectively. All loans receivable of the Company were pledged
as collateral at June 30, 2017 for the fulfillment of the Net Profit calculation.
Year
Ended December 31, 2016 Compared to Year Ended December 31, 2015
We
used cash in operations of $2,777,621 during the year ended December 31, 2016, compared to $3,959,568 during the year ended December
31, 2015, and this decrease is in line with expectations due to the growth of our revenue. We used net cash from investing activities
of $1,115,567 during the year ended December 31, 2016, compared to $4,057,025 during the year ended December 31, 2015. The decrease
in cash used in investing activities is primarily due to an increase in loans receivable repaid and a decrease in loans receivable
originated.
We
were provided $3,730,070 of net cash from financing activities during the year ended December 31, 2016, compared to $8,068,440
during the year ended December 31, 2015. The funds were attributable to proceeds from preferred stock and common stock received
and was a decrease from the corresponding period in 2015.
At
December 31, 2016, we had cash on hand of $322,441, which when added to budgeted cash inflows from loans receivable repaid and
budgeted cash inflows from revenues, is sufficient to meet our operating needs for the next 12 months.
On
April 13, 2015, the Company secured a $200,000 working capital loan to expand from Dr. L. Prasad, an investor in the Company.
On June 24, 2015, the Company repaid $230,000 which comprised $200,000 principal and a $30,000 facility fee which was recorded
as interest expense.
On
April 13, 2015, the Company secured a $100,000 working capital loan to expand from Domenic Tacca, an investor in the Company.
On June 24, 2015, the Company repaid $115,000 which comprised $100,000 principal and a $15,000 facility fee which was recorded
as interest expense.
On
April 13, 2015, the Company secured a $100,000 working capital loan to expand from CT Super, an investor in the Company. On June
24, 2015, the Company repaid $115,000 which comprised $100,000 principal and a $15,000 facility fee which was recorded as interest
expense.
The
principal conditions/events that raise substantial doubt of the company’s ability to meet its obligations are i) the Company
has reported recurring losses and ii) the Company has not yet generated positive net cash flows from operations. However, the
Company has increased its revenue resulting from an increased average loan balance in 2016 as compared to 2015, and management
has evaluated the result of their plans for the next 12 months and as a result of the plans, the Company can meet all its obligations
through March 2018, which has alleviated the substantial doubt. Management’s plans include a continued reduction of advertising
costs to continue reducing loan originations and related loan processing costs. There is also a significant reduction in consulting
and professional fees due to minimized efforts and strategy for raising capital over the next 12 months. In addition, significant
core operating costs have been cut from the Company starting in 2016 including reducing the number of employees from 12 to 6 due
to increased automation of loan origination processes and reducing the number of office leases from 4 to 1 as old leases expired.
In addition, the CEO’s annual base consulting fee has been reduced to $1 per annum from January 1, 2017. Should the Company
need, management will continue to reduce loan originations and now plans to utilize the cash flow from loan repayments for working
capital needs. This will provide sufficient cash flow through at least March 2018. However, the Company intends, over the next
12 months, to seek additional capital via unsecured notes and/or preference shares to expand operations and the Company. Subsequent
to year-end, the Board of Directors approved a stock repurchase program. Management has no intention to repurchase shares unless
additional capital has been secured.
On
August 21, 2015, we, through certain of our wholly owned subsidiaries, paid an aggregate of $1,676,954, representing all principal
and accrued interest under the Loan and Security Agreement, as amended (the “Loan Agreement”), among BFG and certain
of our wholly owned subsidiaries. As a result, there is currently no outstanding balance under the Loan Agreement. However, the
Loan Agreement continues in effect and we are subject to a net profit interest under which we are required to pay BFG 20% of the
“Net Profit” of its subsidiary, IEC SPV, LLC, until 10 years from the date the loan is repaid in full (August 2015).
Net Profit is defined as the gross revenue less (i) interest paid on the loan, (ii) payments on any other debt incurred as a result
of refinancing the loan through a third party, as provided in the Loan Agreement, (iii) any costs, fees or commissions paid on
the existing credit facility, and (iv) charge-offs to bad debt resulting from consumer loans and reduced by servicing fee. The
Net Profit arrangement can be terminated by us upon a payment of $3,000,000 to BFG. Net profit interest for the year ended December
31, 2016 and 2015 were $57,094 and $107,340, respectively. All loans receivable of the Company were pledged as collateral at December
31, 2016 for the fulfillment of the Net Profit calculation. As of December 31, 2016, $57,094 has been paid.
Off-Balance
Sheet Arrangements
As of June 30, 2017 and December 31, 2016, we did not have any off-balance sheet arrangements that have or
are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or
expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term
“off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which
an entity unconsolidated with us is a party, under which we have any obligation arising under a guarantee contract, derivative
instrument or variable interest or a retained or contingent interest in assets transferred to such entity or similar arrangement
that serves as credit, liquidity or market risk support for such assets.
Basis
of Accounting
These
consolidated financial statements include the operations of IEG Holdings and its wholly-owned subsidiaries, IEC and IEC
SPV. All inter-company transactions and balances have been eliminated in consolidation.
The
Company’s accounting and reporting policies are in accordance with U.S. generally accepted accounting principles (“GAAP”)
and conform to general practices within the consumer finance industry.
The
consolidated financial statements have been prepared in conformity with GAAP. The accompanying consolidated financial statements
do not include any adjustments to reflect any possible future effects on the recoverability and classification of assets or the
amounts and classification of liabilities.
The
principal conditions/events that raise substantial doubt about the Company’s ability to meet its obligations are i) the
Company has reported recurring losses and ii) the Company has not yet generated positive net cash flows from operations. However,
the Company has reduced its core operating expenses. In addition, cash in bank significantly increased during the quarter, resulting
from substantial positive net cash flows from investing activities. Management has evaluated the result of their plans for the
next 12 months and as a result of the plans, the Company can meet all its obligations at least through August 2018. However, the
Company intends, over the next 12 months, to seek additional capital to expand operations.
Critical
Accounting Policies
We
have identified the following policies below as critical to our business and results of operations. Our reported results are impacted
by the application of the following accounting policies, certain of which require management to make subjective or complex judgments.
These judgments involve making estimates about the effect of matters that are inherently uncertain and may significantly impact
quarterly or annual results of operations. For all of these policies, management cautions that future events rarely develop exactly
as expected, and the best estimates routinely require adjustment. Specific risks associated with these critical accounting policies
are described in the following paragraphs.
Use
of Estimates
The
preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions
that affect the reported amounts and disclosures. Management uses its historical records and knowledge of its business in making
these estimates. Accordingly, actual results may differ from these estimates.
Loans
Receivable and Interest Income
The
Company offers its loans at or below the prevailing statutory rates. Loans are carried at the unpaid principal amount outstanding,
net of an allowance for credit losses.
The
Company calculates interest revenue using the interest yield method. Charges for late payments are credited to income when collected.
Accrual
of interest income on loans receivable is suspended when no payment has been received on account for 91 days or more on a contractual
basis, at which time a loan is considered delinquent. Payments received on nonaccrual financing loans are first applied to the
unpaid accrued interest and then principal. Loans are returned to active status and accrual of interest income is resumed when
all of the principal and interest amounts contractually due are brought current; at which time management believes future payments
are reasonably assured. At June 30, 2017, 74 loans, with a total balance of $335,563 were delinquent or in default. At December
31, 2016, 83 loans with a total balance of $367,098 were delinquent or in default.
Allowance
for Credit Losses
The
Company maintains an allowance for credit losses due to the fact that it is probable that a portion of the loans receivable will
not be collected. The allowance is estimated by management based on various factors, including specific circumstances of the individual
loans, management’s knowledge of the industry, and the experience and trends of other companies in the same industry.
Our
portfolio of loans receivable consists of a large number of relatively small, homogenous accounts. The allowance for credit losses
is determined using a systematic methodology, based on a combination of historical bad debt of comparable companies. Impaired
loans are considered separately and 100% charged off.
The
allowance for credit losses is primarily based upon models that analyze specific portfolio statistics and also reflect, management’s
judgment regarding overall accuracy. We take into account several factors, including the customer’s transaction history,
specifically the timeliness of customer payments, the remaining contractual term of the loan, and the outstanding balance of the
loan.
Impaired
Loans
The
Company assesses loans for impairment individually when a loan is 91 days past due. The Company defines impaired loans as bankrupt
accounts and accounts that are 184 days or more past due. In accordance with the Company’s charge-off policy, once a loan
is deemed uncollectible, 100% of the remaining balance is charged-off. Loans can also be charged off when deemed uncollectible
due to consumer specific circumstances.
The
Company does not accrue interest on impaired loans and any recoveries of impaired loans are recorded to the allowance for credit
losses. Changes in the allowance for credit losses are recorded as operating expenses in the accompanying statement of operations.
Income
Taxes
We
account for income taxes using the liability method in accordance with the Financial Accounting Standards Board (“FASB”)
Accounting Standards Codification (“ASC”) 740 “Income Taxes”. To date, no current income tax liability
has been recorded due to our accumulated net losses. Deferred income tax assets and liabilities are recognized for temporary differences
between the financial statement carrying amounts of assets and liabilities and the amounts that are reported in the income tax
returns. Our net deferred income tax assets have been fully reserved by a valuation allowance due to the uncertainty of our ability
to realize future taxable income and to recover our net deferred income tax assets.
Earnings
and Loss per Share
The
Company computes net earnings (loss) per share in accordance with ASC 260-10 that establishes standards for computing and presenting
net earnings (loss) per shares. Basic earnings (loss) per share are computed by dividing net income (loss) attributed to common
shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is
computed similar to basic earnings per share except that the denominator is increased to include the number of additional common
shares that would have been outstanding if the potential common shares, if any, had been issued and if the additional common shares
were dilutive. Basic and diluted loss per share has been adjusted retroactively for the net 1-for-10 reverse split that occurred
on October 27, 2016.
Fair
Value of Financial Instruments
Carrying
amounts reported in the consolidated balance sheets for other receivables, accounts payable, and accrued expenses approximate
fair value because of their immediate or short-term nature. The fair value of borrowings is not considered to be significantly
different than its carrying amount because the stated rates for such debt reflect current market rates and conditions. Loans receivable
are carried net of the allowance for credit losses and approximate their fair value.
Recently
Issued or Newly Adopted Accounting Standards
In
May 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-09,
Revenue from Contracts with Customers
.
The standard will eliminate the transaction and industry specific revenue recognition guidance under current U.S. GAAP and replace
it with a principle based approach for determining revenue recognition. ASU 2014-09 is effective for annual and interim periods
beginning after December 15, 2017. Early adoption is not permitted. The revenue recognition standard is required to be applied
retrospectively, including any combination of practical expedients as allowed in the standard. We are evaluating the impact, if
any, of the adoption of ASU 2014-09 to our financial statements and related disclosures. The Company has not yet selected a transition
method nor has it determined the effect of the standard on its ongoing financial reporting.
In
August 2014, the FASB issued ASU 2014-15,
Presentation of Financial Statements—Going Concern (Subtopic 205-40):
Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern
. ASU 2014-15 changes to the disclosure
of uncertainties about an entity’s ability to continue as a going concern. These changes require an entity’s management
to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s
ability to continue as a going concern within one year after the date that financial statements are issued. Substantial doubt
is defined as an indication that it is probable that an entity will be unable to meet its obligations as they become due within
one year after the date that financial statements are issued. If management has concluded that substantial doubt exists, then
the following disclosures should be made in the financial statements: (i) principal conditions or events that raised the substantial
doubt, (ii) management’s evaluation of the significance of those conditions or events in relation to the entity’s
ability to meet its obligations, (iii) management’s plans that alleviated the initial substantial doubt or, if substantial
doubt was not alleviated, management’s plans that are intended to at least mitigate the conditions or events that raise
substantial doubt, and (iv) if the latter in (iii) is disclosed, an explicit statement that there is substantial doubt about the
entity’s ability to continue as a going concern. These changes became effective for the Company for the 2016 annual period.
Our adoption of these changes have no material impact on the consolidated financial statements.
In
November 2015, the FASB issued ASU No. 2015-17,
Income Taxes
(Topic 740). The amendments in ASU 2015-17 change the requirements
for the classification of deferred taxes on the balance sheet. Currently, GAAP requires an entity to separate deferred income
tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position. To simplify the
presentation of deferred income taxes, the amendments in this ASU require that deferred tax liabilities and assets be classified
as noncurrent in a classified statement of financial position. The pronouncement is effective for fiscal years and interim periods
within those fiscal years beginning after December 15, 2016. Adoption of these changes have no material impact on the consolidated
financial statements.
In
January 2016, the FASB issued ASU 2016-01,
Financial Instruments – Overall
(Subtopic 825-10): Recognition and Measurement
of Financial Assets and Financial Liabilities. The update intends to enhance the reporting model for financial instruments to
provide users of financial statements with more decision-useful information and addresses certain aspects of the recognition,
measurement, presentation, and disclosure of financial instruments. The new standard affects all entities that hold financial
assets or owe financial liabilities. For public business entities, the amendments in this Update are effective for fiscal years
beginning after December 15, 2017, including interim periods within those fiscal years. Management is evaluating the impact of
the adoption of these changes will have on the consolidated financial statements.
In
February 2016, the FASB issued ASU 2016-02,
Leases (Topic 842),
which supersedes existing guidance on accounting for leases
in “Leases (Topic 840)” and generally requires all leases to be recognized in the consolidated balance sheet. ASU
2016-02 is effective for annual and interim reporting periods beginning after December 15, 2018; early adoption is permitted.
The provisions of ASU 2016-02 are to be applied using a modified retrospective approach. The Company is currently evaluating the
impact of the adoption of this standard on its consolidated financial statements.
In
April 2016, the FASB issued AS 2016-10,
Revenue from Contracts with Customers (Topic 606)
, which amends certain aspects
of the Board’s new revenue standard, ASU 2014-09, Revenue from Contracts with Customers. The standard should be adopted
concurrently with adoption of ASU 2014-09 which is effective for annual and interim periods beginning after December 15, 2017.
Early adoption is permitted. The Company has not yet selected a transition method nor has it determined the effect of the standard
on its ongoing financial reporting.
DESCRIPTION
OF BUSINESS
Business
Overview
We
provide unsecured online consumer loans under the brand name “Mr. Amazing Loans” via our website and online application
portal at
www.mramazingloans.com
. We started our business and opened our first office in Las Vegas, Nevada in 2010. We
currently offer $5,000 and $10,000 unsecured consumer loans that mature in five years. We are currently licensed and originating
direct consumer loans in 20 states – Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana,
Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, Virginia and Wisconsin. We
provide loans to residents of these states through our online application portal, with all loans originated, processed and serviced
out of our centralized Las Vegas head office, which eliminates the need for physical offices in all of these states.
Our
strategy is to address the market needs of underbanked consumers that tend to be ignored by mainstream institutional credit providers
such as banks and credit unions, and charged excessive fees and interest by fringe lenders such as payday lenders. In the current
global environment, we believe there is a substantial need and opportunity for the small personal loans we offer.
All
of our personal loans are offered at prevailing statutory rates with fixed affordable repayments and no prepayment penalties.
We conduct full underwriting on all applications including credit checks and review of bank statements to ensure customers have
capacity to repay their loans, and have designed our loans to help customers reach a stronger financial position.
We
have a history of reporting recurring losses and have not generated positive net cash flows from operations. For the years ended
December 31, 2016 and 2015, we generated revenue of $2,135,046 and $1,835,165, respectively, and had net losses of $4,728,869
and $5,698,198, respectively. For the six months ended June 30, 2017 and 2016, we generated revenue of $881,324 and $1,070,328,
respectively, and had net losses of $1,555,922 and $2,201,211, respectively.
We
were organized as a Florida corporation on January 21, 1999, originally under the name Interact Technologies, Inc. In February
2013, we changed our name to IEG Holdings Corporation. We have two wholly-owned subsidiaries, IEC, our U.S. operating entity that
holds all of our state licenses, leases, employee contracts and other operating and administrative assets, and IEC SPV, a bankruptcy
remote special purpose entity that holds our U.S. loan receivables.
Market
We
operate in the consumer finance industry serving the large and growing population of consumers who have limited access to credit
from banks, credit card companies and other lenders. According to the Federal Deposit Insurance Corporation, 7.7% (1 in 13) of
households in the United States were unbanked in 2013. This proportion represented nearly 9.6 million households. According to
the Center for Financial Services December 2015 report, the rapid rise of short term credit, which grew 37% from 2012 to 2014,
while single payment credit grew only 0.1% over the same period, is starkly apparent. With anticipated regulatory changes likely
to alter the feasibility of offering loans due in one lump sum, many companies are investing more heavily in installment-based
credit products, while new players are seeking to upend the economics of small-dollar loans through online channels and alternative
underwriting. The strong marketing and new account approval rates of subprime credit cards have also provided consumers with increased
access to funds available on a short-term basis. Together, these shifts in the consumer lending industry suggest that total revenue
for short term credit products, sized at $29 billion in 2014, will soon outpace that of single payment credit products, sized
at $38 billion for the same year. In fact, short term credit products already generate nearly twice as much annual revenue as
single payment credit products.
Installment
lending to non-prime consumers is one of the most highly fragmented sectors of the consumer finance industry. We are a state-licensed
Internet-based personal loan company serving in the consumer installment lending industry. Our online lending platform provides
the distribution network to efficiently address this growing market of consumers without the significant costs and overhead associated
with an extensive branch network. We believe we are well positioned to capitalize on the significant growth and expansion opportunity
created by the continued shift of consumers to online services, such as online banking and in our case online personal loans.
We
are currently licensed and providing loans online to residents of Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky,
Louisiana, Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, Virginia and Wisconsin,
with plans to continue to expand across the United States by acquiring additional state lending licenses. The following is a breakdown
of our cumulative loan origination amounts in each licensed state for our current active loan portfolio as at June 30, 2017:
State
|
|
Origination
Volume
($)
|
|
|
Current
Principal
($)
|
|
|
Number
of
Loans
|
|
Alabama
|
|
|
125,000
|
|
|
|
84,490
|
|
|
|
18
|
|
Arizona
|
|
|
822,000
|
|
|
|
307,787
|
|
|
|
87
|
|
California
|
|
|
1,025,000
|
|
|
|
658,980
|
|
|
|
145
|
|
Florida
|
|
|
2,290,000
|
|
|
|
812,024
|
|
|
|
232
|
|
Georgia
|
|
|
1,433,023
|
|
|
|
627,832
|
|
|
|
152
|
|
Illinois
|
|
|
1,796,000
|
|
|
|
774,418
|
|
|
|
188
|
|
Kentucky
|
|
|
15,000
|
|
|
|
13,783
|
|
|
|
3
|
|
Louisiana
|
|
|
15,000
|
|
|
|
8,409
|
|
|
|
2
|
|
Maryland
(1)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Missouri
|
|
|
413,000
|
|
|
|
187,392
|
|
|
|
48
|
|
Nevada
|
|
|
1,738,000
|
|
|
|
515,616
|
|
|
|
141
|
|
New
Jersey
|
|
|
1,682,000
|
|
|
|
692,129
|
|
|
|
167
|
|
New
Mexico
|
|
|
45,000
|
|
|
|
21,792
|
|
|
|
4
|
|
Ohio
(2)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Oregon
|
|
|
300,000
|
|
|
|
135,843
|
|
|
|
33
|
|
Pennsylvania
|
|
|
815,000
|
|
|
|
445,384
|
|
|
|
101
|
|
Texas
|
|
|
740,000
|
|
|
|
218,054
|
|
|
|
71
|
|
Utah
|
|
|
75,000
|
|
|
|
38,349
|
|
|
|
9
|
|
Virginia
|
|
|
1,055,000
|
|
|
|
475,649
|
|
|
|
114
|
|
Wisconsin
(3)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
(1)
|
Maryland was added
as a licensed state in October 2016.
|
|
(2)
|
Ohio was added as a licensed state in December
2016.
|
|
(3)
|
Wisconsin was added as a licensed
state in June 2017.
|
Business
Strategy
Our
business strategy is to lower the cost of providing consumer loans by leveraging our online lending platform and distribution
network, while continuing to obtain additional state licenses to enable further loan book growth and portfolio diversification.
Our strategy includes a number of key elements:
|
●
|
State-Licensed
Model:
Our state-licensed business model is a key element of our business strategy. We are currently licensed in Alabama,
Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana, Maryland, Missouri, Nevada, New Jersey, New Mexico,
Ohio, Oregon, Pennsylvania, Texas, Utah, Virginia and Wisconsin, and plan to continue expanding across the United States
by acquiring additional state lending licenses.
|
|
|
|
|
●
|
Online Distribution:
We launched online lending in March 2013 and commenced online advertising in July 2013. Upon fulfillment of state regulatory
requirements, we received approval from regulators in Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky,
Louisiana, Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, Virginia and Wisconsin
to operate solely online in these states. This allows us to fully service all 20 states from our centralized Las
Vegas headquarters, which we believe is a key competitive advantage over brick and mortar lenders.
|
|
|
|
|
●
|
Cost-Effective
Customer Acquisition:
Our customer acquisition costs have been reduced since we launched online lending and marketing.
|
|
|
|
|
●
|
Continue to Grow
Loan Book:
Total cumulative loan originations as of June 30 , 2017 have increased 159% to $14,699,023
since our January 1, 2015 total of $5,549,023. This growth in lending is attributable to launching online lending and
joint venturing with a number of new marketing partners, however, such past growth is not necessarily indicative or predictive
of our future results of operation.
|
|
|
|
|
●
|
Strategic Acquisitions:
We have reviewed, and continue to review, opportunities to expand our business through acquisition or merger in the consumer
finance sector. We are pursuing opportunities that provide synergies with our existing business and specifically target potential
acquisitions that are significantly accretive to net asset value and/or provide significant revenue growth opportunities via
a minority or majority shareholding.
|
Competitive
Strengths
We
believe our competitive strengths are:
|
●
|
Large Market
and Scope for Growth:
Large personal and payday loan market in the United States presents opportunity for significant
growth and expansion.
|
|
|
|
|
●
|
Regulation:
We
are materially compliant with state lending licenses in Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky,
Louisiana, Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, Virginia and Wisconsin,
and are well positioned for current and future regulatory changes due to ongoing compliance and conservative business
model.
|
|
●
|
Customer
Proposition:
Our unsecured $5,000 and $10,000 installment loans are all offered over five years and feature affordable
weekly repayments. Rates range from 19.9% - 29.9% APR which make us a low cost alternative to payday loans which have an average
APR of over 400%.
|
|
|
|
|
●
|
Online
Distribution
: Special approval has been granted by the
Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana, Maryland,
Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, Virginia
and Wisconsin regulators to operate our business without a physical office location
in each state. As a result, we have closed offices in Arizona, Illinois and Florida and
moved to full online loan distribution, enabling us to offer loans to residents in all
20 of our licensed states from our Las Vegas headquarters.
|
|
|
|
|
●
|
Customer
Acquisition
:
We launched online advertising in July
2013 with positive results from search engine cost per click advertising and online lead
generation. In addition, we engaged a number of new marketing partners in 2014, 2015
and 2016, including online lead generators and direct mail. All of these avenues provide
opportunities for strong growth at low customer acquisition costs.
|
|
|
|
|
●
|
Barriers
to Entry:
We believe that state licensure acts as a barrier to entry into our segment of the consumer loan market. We
are strongly positioned with approval to operate under 20 state licenses from one centralized head office.
|
Products
We
currently provide $5,000 and $10,000 online consumer loans unsecured over a five-year term with rates ranging from 19.9% to 29.9%
annual percentage rate. Our current loan portfolio also includes loans remaining from our previous product offerings which were
$2,000 to $10,000 loans unsecured over a three- to five-year term at 18.0% to 29.9%.
Our
personal loan products are fully amortizing, fixed rate, unsecured installment loans and all loans are offered at prevailing statutory
rates, with our standard loan product being a 29.9% interest rate and annual percentage rate, fully amortizing, five-year unsecured
personal loan. The variations from this standard loan product in certain states is due to individual state requirements and to
comply with our state lending licenses; for example, Florida requires a blended rate which caps the maximum rate on a $5,000 loan
at 24%.
The
following is a breakdown of loan terms and interest rates for each currently licensed state:
State
|
|
IEG Holdings’
APR for
$5,000
Loans
|
|
|
Maximum
Permitted
Rate for
$5,000 Loans
|
|
|
IEG Holdings’
APR for
$10,000
Loans
|
|
|
Maximum
Permitted
Rate for
$10,000 Loans
|
|
Alabama
|
|
|
29.90
|
%
|
|
|
36.00
|
%(1)
|
|
|
29.90
|
%
|
|
|
36.00
|
%(1)
|
Arizona
|
|
|
24.90
|
%
|
|
|
24.90
|
%
|
|
|
23.90
|
%
|
|
|
23.90
|
%
|
California
|
|
|
29.90
|
%
|
|
|
36.00
|
%
|
|
|
29.90
|
%
|
|
|
36.00
|
%
|
Florida
|
|
|
23.90
|
%
|
|
|
24.00
|
%
|
|
|
19.90
|
%
|
|
|
21.00
|
%
|
Georgia
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
Illinois
|
|
|
29.90
|
%
|
|
|
36.00
|
%
|
|
|
29.90
|
%
|
|
|
36.00
|
%
|
Kentucky
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
Louisiana
|
|
|
28.90
|
%
|
|
|
28.90
|
%
|
|
|
25.50
|
%
|
|
|
25.50
|
%
|
Maryland
|
|
|
24.00
|
%
|
|
|
24.00
|
%
|
|
|
24.00
|
%
|
|
|
24.00
|
%
|
Missouri
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
|
|
29.90
|
%
|
|
|
29.90
|
%
|
Nevada
|
|
|
29.90
|
%
|
|
|
36.00
|
%(1)
|
|
|
29.90
|
%
|
|
|
36.00
|
%(1)
|
New Jersey
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
New Mexico
|
|
|
29.90
|
%
|
|
|
36.00
|
%(1)
|
|
|
29.90
|
%
|
|
|
36.00
|
%(1)
|
Ohio
|
|
|
25.00
|
%
|
|
|
25.00
|
%
|
|
|
—
|
(2)
|
|
|
—
|
(2)
|
Oregon
|
|
|
29.90
|
%
|
|
|
36.00
|
%
|
|
|
29.90
|
%
|
|
|
36.00
|
%
|
Pennsylvania
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
Texas
|
|
|
28.86
|
%
|
|
|
28.86
|
%
|
|
|
25.84
|
%
|
|
|
25.84
|
%
|
Utah
|
|
|
29.90
|
%
|
|
|
36.00
|
%(1)
|
|
|
29.90
|
%
|
|
|
36.00
|
%(1)
|
Virginia
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
|
|
29.90
|
%
|
|
|
30.00
|
%
|
Wisconsin
|
|
|
29.90
|
%
|
|
|
36.00
|
%
|
|
|
29.90
|
%
|
|
|
36.00
|
%
|
|
(1)
|
There is no rate
limit in this jurisdiction. However, in order to comply with the Servicemembers Civil Relief Act, the maximum APR is 36.0%.
|
|
|
|
|
(2)
|
We do not offer
$10,000 loans in Ohio.
|
The
following is an illustrative profile of our personal loans:
|
Loan
Product
|
-
|
$5,000
and $10,000 loans
|
|
|
-
|
5
years
|
|
|
-
|
28.9%
average APR
|
|
|
-
|
Fixed
rate, fully amortizing
|
|
|
-
|
No
hidden or additional fees
|
|
|
-
|
No
prepayment penalties
|
|
Loan
Purpose
|
Loans
available for any purpose. Common uses include:
|
|
|
-
|
Debt
consolidation
|
|
|
-
|
Medical
expenses
|
|
|
-
|
Home
improvements
|
|
|
-
|
Auto
repairs
|
|
|
-
|
Major
purchase
|
|
|
-
|
Discretionary
spending
|
|
|
|
|
|
Average
Borrower Demographic
|
-
|
600
- 750 credit score
|
|
|
-
|
$
40,000
- $100,000 income
|
|
|
-
|
25
- 60 years old
|
We
commenced originating personal loans online in July 2013. Prior to that, we provided loans to customers via our office network,
which comprised one office in each state as required by state licensing regulations. Our online loan origination platform now
means that a qualifying customer can obtain a loan from us without having to come into an office location. We have maintained
our full underwriting processes, identity verifications and fraud checks to ensure that online customers are verified to the same
degree that customers were when they obtained a loan in an office. We expect our website and application portal,
www.mramazingloans.com
,
to be a key driver of customer conversions and loan book growth.
The
following graphs depict our monthly loan origination values from January 2013 through July 2017 and our yearly revenue
for 2013 through 2016:
The
following table sets forth the minimum, maximum and average credit score, income and age of our current borrowers as of June
30, 2017:
Average
Borrower Demographic of Current Loan Portfolio as at June 30 , 2017
Demographic
|
|
Minimum
|
|
|
Maximum
|
|
|
Average
|
|
Credit
Score
|
|
|
559
|
|
|
|
886
|
|
|
|
661
|
|
Income
|
|
$
|
24,372
|
|
|
|
273,396
|
|
|
|
63,562
|
|
Age
|
|
|
23
|
|
|
|
83
|
|
|
|
46
|
|
Customer
Acquisition
Since
launching online lending in July 2013, our marketing efforts have been focused on online customer acquisition. We saw significant
increases in loan applications and inquiries as a result of search engine advertising and commenced banner advertising, remarketing
and search engine optimization in 2014. We commenced online video advertising in 2015. We have also engaged numerous online lead
generators who provide personal loan leads on a daily basis with a combination of cost per funded loan and cost per application
expense. We are continuing to develop relationships with additional lead generation partners to drive further growth. We also
supplement our online marketing efforts with traditional direct mail advertising.
Additional
Information Regarding Our Loan Portfolio
This
section provides additional quantitative information and qualitative discussion related to our loan portfolio and related credit
metrics and trends including key loan and credit metrics.
Loans
Receivable Roll-Forward
The
table below documents the activity in the loan receivable accounts for the period indicated. Specifically, it shows a roll-forward
of our loans receivable balance, detail of new loan originations, principal reductions from cash collections and loan charge-offs.
The data encompasses changes during the quarter ended March 31, 2017 compared to December 31, 2016 .
|
|
New
Loans
|
|
|
Principal
Reductions
|
|
|
Loan
Charge-Offs
|
|
|
Quarter-end
Balance
|
|
Q1 2017 Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance 12-31-16 $7,587,349
|
|
$
|
140,000
|
|
|
$
|
482,391
|
|
|
$
|
330,637
|
|
|
$
|
6,914,321
|
|
New
loan volume slowed in the quarter ended March 31, 2017 due to Company capital constraints and reduced advertising. The level of
principal reductions from cash collections, combined with reduced new 2017 first quarter loan volumes (compared to 2016) and loan
charge-offs, resulted in a reduction in the loans receivable balance to $6,914,321 as at March 31, 2017 compared to $7,587,349
at December 31, 2016.
The
table below documents the activity in the loan receivable accounts for the period indicated. Specifically, it shows a roll-forward
of our loans receivable balance, detail of new loan originations, principal reductions from cash collections and loan charge-offs.
The data encompasses changes during the quarter ended June 30, 2017 compared to March 31, 2017.
|
|
New
Loans
|
|
|
Principal
Reductions
|
|
Loan
Charge-Offs
|
|
|
Quarter-end
Balance
|
Q2 2017
Activity
|
|
|
|
|
|
|
|
|
|
|
|
Balance
3-31-17 $6,914,321
|
|
$
|
145,000
|
|
|
$
|
503,130
|
|
$
|
538,259
|
|
|
$6,017,932
|
New
loan volume was steady in the quarter ended June 30, 2017 due to Company capital constraints and reduced advertising. The level
of principal reductions from cash collections, combined with steady new 2017 second quarter loan volumes and increased loan charge-offs,
resulted in a reduction in the loans receivable balance to $6,017,932 as at June 30, 2017 compared to $6,914,321 at March 31,
2017.
The
table below documents the activity in the loan receivable accounts for the periods indicated. Specifically, it shows a roll-forward
of our loans receivable balance, detail of new loan originations, principal reductions from cash collections and loan charge-offs.
The data encompasses changes during each quarter of 2016 and also changes during the full year 2016 compared to 2015.
|
|
New
Loans
|
|
|
Principal
Reductions
|
|
|
Loan
Charge-Offs
|
|
|
Quarter-end
Balance
|
|
Q1 2016 Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance 12-31-15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$8,110,077
|
|
$
|
535,000
|
|
|
$
|
541,082
|
|
|
$
|
441,956
|
|
|
$
|
7,662,039
|
|
Q2 2016 Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance 3-31-16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$7,662,039
|
|
$
|
1,785,000
|
|
|
$
|
459,806
|
|
|
$
|
220,725
|
|
|
$
|
8,766,508
|
|
Q3 2016 Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance 6-30-16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$8,766,508
|
|
$
|
375,000
|
|
|
$
|
567,779
|
|
|
$
|
320,239
|
|
|
$
|
8,253,490
|
|
Q4 2016 Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance 9-30-16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$8,253,490
|
|
$
|
425,000
|
|
|
$
|
435,766
|
|
|
$
|
655,375
|
|
|
$
|
7,587,349
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2016 Activity Summary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bal 12-31-15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$8,110,077
|
|
$
|
3,120,000
|
|
|
$
|
2,004,433
|
|
|
$
|
1,638,295
|
|
|
$
|
7,587,349
|
|
New
loan volume slowed in the second half of 2016 due to Company capital constraints and reduced advertising. The level of principal
reductions from cash collections, combined with reduced new 2016 loan volumes (compared to 2015) and an increase in loan charge-offs,
resulted in a reduction in the loans receivable balance to $7,587,349 as at December 31, 2016 compared to $8,110,077 at December
31, 2015.
The
table below documents the activity in the loan receivable accounts for the periods indicated. Specifically, it shows a roll-forward
of our loans receivable balance, detail of new loan originations, principal reductions from cash collections and loan charge-offs.
The data encompasses changes during each quarter of 2015 and also changes during the full year 2015 compared to 2014.
|
|
New
Loans
|
|
|
Principal
Reductions
|
|
|
Loan
Charge-Offs
|
|
|
Quarter-end
Balance
|
|
Q1 2015 Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance 12-31-14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$4,913,279
|
|
$
|
859,586
|
|
|
$
|
273,040
|
|
|
$
|
91,223
|
|
|
$
|
5,408,602
|
|
Q2
2015 Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance 3-31-15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$5,408,602
|
|
$
|
2,670,296
|
|
|
$
|
311,146
|
|
|
$
|
161,601
|
|
|
$
|
7,606,151
|
|
Q3
2015 Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance 6-30-15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$7,606,151
|
|
$
|
741,969
|
|
|
$
|
450,143
|
|
|
$
|
202,793
|
|
|
$
|
7,695,184
|
|
Q4
2015 Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance 9-30-15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$7,695,184
|
|
$
|
1,110,000
|
|
|
$
|
404,617
|
|
|
$
|
290,490
|
|
|
$
|
8,110,077
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 Activity Summary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bal 12-31-14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$4,913,279
|
|
$
|
5,381,851
|
|
|
$
|
1,438,946
|
|
|
$
|
746,107
|
|
|
$
|
8,110,077
|
|
New
loan volume increased during 2015 due to increased Company capital raising and increased advertising. The level of principal reductions
from cash collections, combined with increased new 2015 loan volumes (compared to 2014) and loan charge-offs, resulted in substantial
growth in loans receivable balance to $8,110,077 at December 31, 2015 compared to $4,913,279 at December 31, 2014.
Portfolio
Yield
The
following table shows, as of June 30, 2017, the aggregate loan principal outstanding and the average portfolio yield by
state. In addition, to show indicative duration of the portfolio yield, the table shows the average loan amount, average current
principal outstanding and the average years to maturity of the loans in each state.
State
|
|
Total
Current
Principal ($)
|
|
|
Average
Yield (%)
|
|
|
Average
Loan Amount
($)
|
|
|
Average
Current
Principal ($)
|
|
|
Average
Years to Maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alabama
|
|
|
84,490
|
|
|
|
29.90
|
|
|
|
5,278
|
|
|
|
4,694
|
|
|
|
3.9
|
|
Arizona
|
|
|
307,787
|
|
|
|
24.70
|
|
|
|
5,379
|
|
|
|
3,538
|
|
|
|
2.5
|
|
California
|
|
|
658,980
|
|
|
|
29.90
|
|
|
|
5,241
|
|
|
|
4,545
|
|
|
|
3.7
|
|
Florida
|
|
|
812,024
|
|
|
|
23.42
|
|
|
|
5,209
|
|
|
|
3,500
|
|
|
|
2.7
|
|
Georgia
|
|
|
627,832
|
|
|
|
29.90
|
|
|
|
5,375
|
|
|
|
4,130
|
|
|
|
3.0
|
|
Illinois
|
|
|
774,418
|
|
|
|
29.90
|
|
|
|
5,314
|
|
|
|
4,119
|
|
|
|
3.1
|
|
Kentucky
|
|
|
13,783
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,594
|
|
|
|
4.0
|
|
Louisiana
|
|
|
8,409
|
|
|
|
28.90
|
|
|
|
5,000
|
|
|
|
4,205
|
|
|
|
3.4
|
|
Missouri
|
|
|
187,392
|
|
|
|
29.90
|
|
|
|
5,021
|
|
|
|
3,904
|
|
|
|
3.1
|
|
Maryland
(1)
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nevada
|
|
|
515,616
|
|
|
|
29.86
|
|
|
|
5,007
|
|
|
|
3,631
|
|
|
|
3.9
|
|
New
Jersey
|
|
|
692,129
|
|
|
|
29.90
|
|
|
|
5,431
|
|
|
|
4,144
|
|
|
|
3.0
|
|
New
Mexico
|
|
|
21,792
|
|
|
|
29.90
|
|
|
|
6,250
|
|
|
|
5,448
|
|
|
|
3.6
|
|
Ohio (2)
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oregon
|
|
|
135,843
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,116
|
|
|
|
3.4
|
|
Pennsylvania
|
|
|
445,384
|
|
|
|
29.90
|
|
|
|
5,347
|
|
|
|
4,410
|
|
|
|
3.4
|
|
Texas
|
|
|
218,054
|
|
|
|
18.00
|
|
|
|
4,706
|
|
|
|
3,004
|
|
|
|
2.9
|
|
Utah
|
|
|
38,349
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,261
|
|
|
|
3.5
|
|
Virginia
|
|
|
475,649
|
|
|
|
29.89
|
|
|
|
5,473
|
|
|
|
4,172
|
|
|
|
3.0
|
|
Wisconsin
(3)
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Maryland
was added as a licensed state in October 2016.
|
|
(2)
|
Ohio was added as a licensed
state in December 2016.
|
|
(3)
|
Wisconsin was added as a licensed
state in June 2017.
|
We
undertook an advertising strategy during the first half of 2017 that focused on refinancing customers in the states with
an average yield of 29.9% only to maximize our portfolio yield while we were capital constrained. The advertising strategy resulted
in an increase in the average portfolio yield in 2017 compared to 2016.
The
following table shows, as of December 31, 2016, the aggregate loan principal outstanding and the average portfolio yield by state.
In addition, to show indicative duration of the portfolio yield, the table shows the average loan amount, average current principal
outstanding and the average years to maturity of the loans in each state.
State
|
|
Total
Current
Principal ($)
|
|
|
Average
Yield (%)
|
|
|
Average
Loan Amount
($)
|
|
|
Average
Current
Principal ($)
|
|
|
Average
Years to
Maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alabama
|
|
|
89,203
|
|
|
|
29.90
|
|
|
|
5,278
|
|
|
|
4,956
|
|
|
|
4.3
|
|
Arizona
|
|
|
370,766
|
|
|
|
24.90
|
|
|
|
5,152
|
|
|
|
3,745
|
|
|
|
2.8
|
|
California
|
|
|
779,210
|
|
|
|
29.90
|
|
|
|
5,215
|
|
|
|
4,780
|
|
|
|
4.2
|
|
Florida
|
|
|
1,073,758
|
|
|
|
23.93
|
|
|
|
5,162
|
|
|
|
3,863
|
|
|
|
3.1
|
|
Georgia
|
|
|
800,394
|
|
|
|
29.90
|
|
|
|
5,379
|
|
|
|
4,522
|
|
|
|
3.6
|
|
Illinois
|
|
|
936,025
|
|
|
|
29.90
|
|
|
|
5,260
|
|
|
|
4,415
|
|
|
|
3.6
|
|
Kentucky
|
|
|
14,426
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,809
|
|
|
|
4.5
|
|
Louisiana
|
|
|
12,839
|
|
|
|
28.90
|
|
|
|
5,000
|
|
|
|
4,280
|
|
|
|
4.0
|
|
Maryland (1)
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Missouri
|
|
|
254,103
|
|
|
|
29.90
|
|
|
|
5,068
|
|
|
|
4,307
|
|
|
|
3.6
|
|
Nevada
|
|
|
663,594
|
|
|
|
29.90
|
|
|
|
4,932
|
|
|
|
3,770
|
|
|
|
3.2
|
|
New Jersey
|
|
|
843,708
|
|
|
|
29.90
|
|
|
|
5,240
|
|
|
|
4,305
|
|
|
|
3.4
|
|
New Mexico
|
|
|
27,056
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,509
|
|
|
|
3.9
|
|
Ohio (2)
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oregon
|
|
|
163,429
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,417
|
|
|
|
3.9
|
|
Pennsylvania
|
|
|
562,074
|
|
|
|
29.90
|
|
|
|
5,427
|
|
|
|
4,804
|
|
|
|
3.9
|
|
Texas
|
|
|
347,538
|
|
|
|
17.80
|
|
|
|
4,820
|
|
|
|
3,764
|
|
|
|
3.4
|
|
Utah
|
|
|
49,829
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,530
|
|
|
|
4.0
|
|
Virginia
|
|
|
599,398
|
|
|
|
29.89
|
|
|
|
5,339
|
|
|
|
4,375
|
|
|
|
3.5
|
|
Wisconsin
(3)
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Maryland
was added as a licensed state in October 2016.
(2)
Ohio was added as a licensed state in December 2016.
(3)
Wisconsin was added as a licensed state in June 2017.
We
undertook an advertising strategy during 2016 that focused on seeking new customers in the states with an average yield of 29.9%
only to maximize our portfolio yield while we were capital constrained. The advertising strategy resulted in an increase in the
average portfolio yield in 2016 compared to 2015.
The
following table shows, as of December 31, 2015, the aggregate loan principal outstanding and the average portfolio yield by state.
In addition, to show indicative duration of the portfolio yield, the table shows the average loan amount, average current principal
outstanding and the average years to maturity of the loans in each state.
State
|
|
Total
Current
Principal ($)
|
|
|
Average
Yield (%)
|
|
|
Average
Loan Amount
($)
|
|
|
Average
Current
Principal ($)
|
|
|
Average
Years to
Maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alabama
|
|
|
34,664
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,952
|
|
|
|
4.9
|
|
Arizona
|
|
|
499,489
|
|
|
|
24.73
|
|
|
|
5,025
|
|
|
|
4,233
|
|
|
|
3.5
|
|
California
|
|
|
364,130
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,921
|
|
|
|
4.8
|
|
Florida
|
|
|
1,456,854
|
|
|
|
23.38
|
|
|
|
4,994
|
|
|
|
4,362
|
|
|
|
3.9
|
|
Georgia
|
|
|
821,007
|
|
|
|
29.90
|
|
|
|
5,162
|
|
|
|
4,746
|
|
|
|
4.2
|
|
Illinois
|
|
|
881,292
|
|
|
|
29.90
|
|
|
|
5,078
|
|
|
|
4,590
|
|
|
|
4.0
|
|
Louisiana
|
|
|
9,895
|
|
|
|
28.90
|
|
|
|
5,000
|
|
|
|
4,947
|
|
|
|
4.9
|
|
Missouri
|
|
|
238,474
|
|
|
|
29.90
|
|
|
|
5,200
|
|
|
|
4,769
|
|
|
|
4.2
|
|
Nevada
|
|
|
794,213
|
|
|
|
29.90
|
|
|
|
4,881
|
|
|
|
4,115
|
|
|
|
3.7
|
|
New Jersey
|
|
|
982,578
|
|
|
|
29.90
|
|
|
|
5,368
|
|
|
|
4,817
|
|
|
|
4.1
|
|
New Mexico
|
|
|
19,459
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,865
|
|
|
|
4.7
|
|
Oregon
|
|
|
176,190
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,762
|
|
|
|
4.5
|
|
Pennsylvania
|
|
|
489,623
|
|
|
|
29.90
|
|
|
|
5,365
|
|
|
|
5,100
|
|
|
|
4.5
|
|
Texas
|
|
|
669,710
|
|
|
|
17.86
|
|
|
|
5,591
|
|
|
|
5,273
|
|
|
|
4.4
|
|
Utah
|
|
|
38,624
|
|
|
|
29.90
|
|
|
|
5,000
|
|
|
|
4,828
|
|
|
|
4.6
|
|
Virginia
|
|
|
633,874
|
|
|
|
29.89
|
|
|
|
5,336
|
|
|
|
4,839
|
|
|
|
4.1
|
|
The
average portfolio yield increased in 2015 compared to 2014 due to increased lending in newly licensed, higher yielding (29.9%)
states.
Customer
Acquisition Costs
Since
launching online lending in 2013, our marketing efforts have been focused on online customer acquisition. We saw significant increases
in loan applications and inquiries as a result of search engine advertising and commenced banner advertising, remarketing and
search engine optimization in 2014. We commenced online video advertising in 2015. We have also engaged numerous online lead generators
who provide personal loan leads on a daily basis with a combination of cost per funded loan and cost per application expense.
We are continuing to develop relationships with additional lead generation partners to drive further growth. We also supplement
our online marketing efforts with traditional direct mail advertising.
The
following table shows the level of advertising cost versus the level of loan volume in 2015, 2016 and the first and second
quarters of 2017 as both a dollar amount and as a percentage of loan volume for the relevant year. The advertising cost represents
both general advertising/brand awareness costs as well as direct fees paid to lead generators and direct mail costs. Although
it potentially overstates the direct cost of customer acquisition in a particular year it provides a guide to the general cost
and trends in customer acquisition costs. In addition, the customer cost of acquisition is upfront, whereas the revenue from the
customer is typically realized 5 years later and for repeat customers, even later.
Origination
Year
|
|
Loan
Volume
|
|
|
Advertising
Cost
|
|
|
Cost
of Acquisition
|
|
2015
|
|
$
|
5,381,851
|
|
|
$
|
950,905
|
|
|
|
18.0
|
%
|
2016
|
|
$
|
3,120,000
|
|
|
$
|
373,350
|
|
|
|
12.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter of 2017
|
|
$
|
140,000
|
|
|
$
|
880
|
|
|
|
0.6
|
%
|
Second Quarter of 2017
|
|
$
|
145,000
|
|
|
$
|
3,460
|
|
|
|
2.4
|
%
|
Due
to the more efficient use of our advertising budget combined with more refined lead sources, there was a significant drop in the
cost of customer acquisition from 18.0% for 2015 to 12.0% for 2016. Advertising expenses as a percentage of new loans funded continued
to decline for the first two quarters of 2017 to 0.6% and 2.4%, compared to the 12% cost for 2016. The sharp fall in the cost
of customer acquisition for the first half of 2017 was predominantly due to a focus on refinancing existing customers rather than
seeking new customers.
Gross
Charge-off Ratio and Recovery Ratio
The
credit quality of our loans is driven by our underwriting criteria, which takes into account income, money management, credit
history, employment history and willingness and capacity to repay the proposed loan. The profitability of our loan portfolio is
directly connected to net credit losses; therefore, we closely analyze credit performance. We also monitor recovery rates because
of their contribution to the reduction in the severity of our charge-offs. Additionally, because delinquencies are an early indicator
of future net credit losses, we analyze delinquency trends, adjusting for seasonality, to determine whether or not our loans are
performing in line with our original estimates. Because loan volume and portfolio size determine the magnitude of the impact of
each of the above factors on our earnings, we also closely monitor origination volume and annual percentage rate.
The
table below sets forth information regarding the gross charge-off ratio and the recovery ratio in both dollar amounts and in terms
of a ratio versus outstanding loans receivable balance. The data is presented for each quarter in 2015 and 2016, for each of the
full years for 2015 and 2016, and for the first and second quarters of 2017.
|
|
Loans
Receivable
|
|
|
Average
Balance
($)
|
|
|
Charge-Offs
($)
|
|
|
Ratio
(%)
|
|
|
Average
Balance
($)
|
|
|
Charge-Offs
($)
|
|
|
Ratio
(%)
|
|
|
Recovery
($)
|
|
|
Recovery
(%)
|
|
Date
|
|
Balance
($)
|
|
|
Quarterly
|
|
|
Quarterly
|
|
|
Quarterly
|
|
|
Annual
|
|
|
Annual
|
|
|
Annual
|
|
|
Annual
|
|
|
Annual
|
|
12-31-14
|
|
|
4,913,279
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3-31-15
|
|
|
5,408,602
|
|
|
|
5,160,940
|
|
|
|
91,223
|
|
|
|
1.77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6-30-15
|
|
|
7,606,151
|
|
|
|
6,507,377
|
|
|
|
161,601
|
|
|
|
2.48
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9-30-15
|
|
|
7,695,184
|
|
|
|
7,650,668
|
|
|
|
202,793
|
|
|
|
2.65
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12-31-15
|
|
|
8,110,077
|
|
|
|
7,902,631
|
|
|
|
290,490
|
|
|
|
3.68
|
|
|
|
6,511,678
|
|
|
|
746,107
|
|
|
|
11.46
|
|
|
|
2,822
|
|
|
|
0.38
|
|
3-31-16
|
|
|
7,662,039
|
|
|
|
7,886,058
|
|
|
|
441,956
|
|
|
|
5.60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6-30-16
|
|
|
8,766,508
|
|
|
|
8,214,273
|
|
|
|
220,725
|
|
|
|
2.69
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9-30-16
|
|
|
8,253,490
|
|
|
|
8,509,999
|
|
|
|
320,239
|
|
|
|
3.76
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12-31-16
|
|
|
7,587,349
|
|
|
|
7,920,419
|
|
|
|
655,375
|
|
|
|
8.27
|
|
|
|
7,848,713
|
|
|
|
1,638,295
|
|
|
|
20.87
|
|
|
|
27,149
|
|
|
|
1.66
|
|
03-31-17
|
|
|
6,914,321
|
|
|
|
7,250,835
|
|
|
|
330,637
|
|
|
|
4.56
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
06-30-17
|
|
|
6,017,932
|
|
|
|
6,466,127
|
|
|
|
538,259
|
|
|
|
8.32
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
We
saw a significant increase in charge-offs in 2016 versus 2015 as we saw an increasing trend in customer hardship and more customers
utilizing external debt management services. While our charge-off policy has not changed, we did deploy more internal resources
to identify the probability of losses given the current economy, the customers’ ability to repay, responsiveness to work
out plans and collection reports. Through this more concerted internal approach, 2016’s charge-offs increased as a percentage
of the portfolio, compared to the results of 2015. We significantly increased our level of loss recoveries in both dollar amount
and percentage of loans receivable balance due to more internal resources being allocated to the task, combined with a larger
pool of losses to recover funds from. The level of charge-offs decreased in the first quarter of 2017 compared to the first quarter
of 2016, as we focused on refinancing existing customers with a solid track record of repayment rather than seeking new customers
and also increased our focus on internal collections. The level of charge-offs increased in the second quarter of 2017 compared
to the second quarter of 2016 as we saw an increasing trend in customer hardship and more customers utilizing external debt management
services
Delinquency
Ratio
The
tables below set forth, for the period indicated, information concerning the delinquency ratio measured in buckets of days delinquent
in both dollar amounts and also as a percentage of total principal.
Delinquency
Summary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Principal 2017
|
|
1-30
Days Principal
|
|
|
1-30
Days Percentage
|
|
|
31-60
Days Principal
|
|
|
31-60
Days Percentage
|
|
|
61-90
Days Principal
|
|
|
61-90
Days Percentage
|
|
|
91-120
Days Principal
|
|
|
91-120
Days Percentage
|
|
|
Over
120 Days Principal
|
|
|
Over
120 Days Percentage
|
|
|
Delinquent
Principal
|
|
|
Delinquent
Percentage
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$6,017,932
|
|
$
|
464,758
|
|
|
|
7.65
|
|
|
$
|
191,151
|
|
|
|
3.18
|
|
|
$
|
121,734
|
|
|
|
2.02
|
|
|
$
|
70,575
|
|
|
|
1.17
|
|
|
$
|
264,988
|
|
|
|
4.41
|
|
|
$
|
648,448
|
|
|
|
10.78
|
|
(1516
Loans)
|
|
|
(118
Loans)
|
|
|
|
|
|
|
|
(45
Loans)
|
|
|
|
|
|
|
|
(32
Loans)
|
|
|
|
|
|
|
|
(14
Loans)
|
|
|
|
|
|
|
|
(60
Loans)
|
|
|
|
|
|
|
|
(151
Loans)
|
|
|
|
|
|
At
June 30, 2017 , we had 74 loans delinquent or in default (defined as 91+ days past due), representing 5.58% of the
number of loans in our active portfolio. Loans become eligible for the lender to take legal action at 60 days past due. At June
30 , 2017, our delinquency percentage rate for past due loans was 10.78% (31+ days) with an allowance for loan loss
at 16.00 %. There was an increase in the delinquency ratio from December 31, 2016 to June 30, 2017 due to an increasing trend
in customer hardship, combined with a fall in loans receivables principal outstanding.
Delinquency
Summary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Principal
2016
|
|
1-30
Days Principal
|
|
|
1-30
Days Percentage
|
|
|
31-60
Days Principal
|
|
|
31-60
Days Percentage
|
|
|
61-90
Days Principal
|
|
|
61-90
Days Percentage
|
|
|
91-120
Days Principal
|
|
|
91-120
Days Percentage
|
|
|
Over
120 Days Principal
|
|
|
Over
120 Days Percentage
|
|
|
Delinquent
Principal
|
|
|
Delinquent
Percentage
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$7,587,349
|
|
$
|
669,570
|
|
|
|
8.83
|
|
|
$
|
257,299
|
|
|
|
3.39
|
|
|
$
|
163,590
|
|
|
|
2.16
|
|
|
$
|
210,790
|
|
|
|
2.78
|
|
|
$
|
156,308
|
|
|
|
2.06
|
|
|
$
|
787,987
|
|
|
|
10.39
|
|
(1782
Loans)
|
|
|
(156
Loans)
|
|
|
|
|
|
|
|
(58
Loans)
|
|
|
|
|
|
|
|
(40
Loans)
|
|
|
|
|
|
|
|
(48
Loans)
|
|
|
|
|
|
|
|
(35
Loans)
|
|
|
|
|
|
|
|
(181
Loans)
|
|
|
|
|
|
At
December 31, 2016, we had 83 loans delinquent or in default (defined as 91+ days past due), representing 4.84% of the number of
loans in our active portfolio. Loans become eligible for the lender to take legal action at 60 days past due. At December 31,
2016, our delinquency percentage rate for past due loans was 10.39% (31+ days) with an allowance for loan loss at 16.00%. There
was an increase in the delinquency ratio from December 31, 2015 to December 31, 2016 due to an increasing trend in customer hardship,
combined with a fall in loans receivables principal outstanding.
Delinquency
Summary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Principal
2015
|
|
1-30
Days Principal
|
|
|
1-30
Days Percentage
|
|
|
31-60
Days Principal
|
|
|
31-60
Days Percentage
|
|
|
61-90
Days Principal
|
|
|
61-90
Days Percentage
|
|
|
91-120
Days Principal
|
|
|
91-120
Days Percentage
|
|
|
Over
120 Days Principal
|
|
|
Over
120 Days Percentage
|
|
|
Delinquent
Principal
|
|
|
Delinquent
Percentage
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$8,110,077
|
|
$
|
427,975
|
|
|
|
5.28
|
|
|
$
|
157,316
|
|
|
|
1.94
|
|
|
$
|
153,623
|
|
|
|
1.90
|
|
|
$
|
95,288
|
|
|
|
1.18
|
|
|
$
|
294,143
|
|
|
|
3.63
|
|
|
$
|
707,370
|
|
|
|
8.72
|
|
(1748
Loans)
|
|
|
(95
Loans)
|
|
|
|
|
|
|
|
(35
Loans)
|
|
|
|
|
|
|
|
(31
Loans)
|
|
|
|
|
|
|
|
(22
Loans)
|
|
|
|
|
|
|
|
(58
Loans)
|
|
|
|
|
|
|
|
(146
Loans)
|
|
|
|
|
|
At
December 31, 2015, we had 80 loans delinquent or in default (defined as 91+ days past due), representing 4.81% of the number of
loans in our active portfolio. Loans become eligible for the lender to take legal action at 60 days past due. At December 31,
2015, our delinquency percentage rate for past due loans was 8.72% (31+ days) with an allowance for loan loss at 12.15%.
Allowance
for Credit Losses Ratio
Management
exercises its judgment, based on quantitative analyses, qualitative factors, such as recent delinquency and other credit trends,
and experience in the consumer finance industry, when determining the amount of the allowance for loan receivable losses. We adjust
the amounts for management's estimate of the effects of events and conditions such as changes to underwriting criteria, portfolio
seasoning, and current economic conditions, including levels of unemployment, and personal bankruptcies.
The
allowance for credit losses ratio (reserve level) was increased from 12.15% for 2015 to 16.00% for 2016. The allowance for credit
losses ratio remained steady at 16.00% for the first and second quarters of 2017. The net loan balance decreased from $7,124,702
at December 31, 2015 to $6,374,908 at December 31, 2016. The net loan balance decreased from $6,374,908 at December 31, 2016 to
$5,055,063 at June 30, 2017 . The net loan balance at the current reserve level of 16.00% is $5,055,063 at
June 30, 2017 .
There
was a slight improvement in lending policies and procedures, including changes in underwriting standards and collection, charge-off,
and recovery practices not considered elsewhere in estimating credit losses in 2016 compared to 2015. There were no material changes
in international, national, regional, and local economic and business conditions and developments in 2016 that affected the collectability
of the portfolio, including the condition of various market segments other than increased customer hardship. There was no significant
change in the nature of the loan portfolio and was a small increase in the average size of the loan portfolio. There were no changes
in the experience, ability, and depth of lending management and other relevant staff in 2016. There was an increase in the volume
and severity of past due loans and the volume of non-accrual loans due to customer hardship. Management pursued a more conservative
level of allowance for credit losses in 2016 to account for this customer hardship. Improvements were made to the quality of our
loan review system in 2016 with further automation of reject applications. There was no significant effect of other external factors
such as competition and legal and regulatory requirements on the level of estimated credit losses in our loan portfolio.
There
was no change in lending policies and procedures, including changes in underwriting standards and collection, charge-off, and
recovery practices not considered elsewhere in estimating credit losses in the first half of 2017 compared to the year ended December
31, 2016. There were no material changes in international, national, regional, and local economic and business conditions and
developments in the first half of 2017 compared to the year ended December 31, 2016 that affected the collectability of the portfolio,
including the condition of various market segments other than increased customer hardship. During the first half of 2017, there
was no significant change in the nature of the loan portfolio and was a small decrease in the average size of the loan portfolio.
There were no changes in the experience, ability, and depth of lending management and other relevant staff in the six months ended
June 30, 2017. There was an increase in the volume and severity of past due loans and the volume of non-accrual loans due to customer
hardship for the six months ended June 30, 2017, as compared to the year ended December 31, 2016. Management pursued the same
conservative level of allowance for credit losses in the first half of 2017 as in 2016 to account for this customer hardship.
No changes were made to the quality of our loan review system in the first half of 2017. There was no significant effect of other
external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in our loan
portfolio in the six months ended June 30, 2017.
Contractual
Loan Maturity
The
following table shows, as of June 30, 2017, the aggregate principal amount of loans by maturity date.
Principal
Maturing
|
|
Current
Principal
|
|
|
Maturing
|
|
Within
1 year
|
|
$
|
7,510
|
|
|
|
0.13
|
%
|
Within
2 years
|
|
$
|
344,990
|
|
|
|
5.73
|
%
|
Within
3 years
|
|
$
|
2,357,664
|
|
|
|
39.18
|
%
|
Within
4 years
|
|
$
|
2,407,978
|
|
|
|
40.01
|
%
|
Within
5 years
|
|
$
|
899,790
|
|
|
|
14.95
|
%
|
TOTAL
|
|
$
|
6,017,932
|
|
|
|
|
|
The
following table shows, as of December 31, 2016, the aggregate principal amount of loans by maturity date.
Principal
Maturing
|
|
Current
Principal
|
|
|
Maturing
|
|
Within
1 year
|
|
$
|
8,356
|
|
|
|
0.11
|
%
|
Within 2 years
|
|
$
|
101,140
|
|
|
|
1.33
|
%
|
Within 3 years
|
|
$
|
1,685,971
|
|
|
|
22.22
|
%
|
Within 4 years
|
|
$
|
3,131,799
|
|
|
|
41.28
|
%
|
Within 5 years
|
|
$
|
2,660,083
|
|
|
|
35.06
|
%
|
TOTAL
|
|
$
|
7,587,349
|
|
|
|
|
|
The
following table shows, as of December 31, 2015, the aggregate principal amount of loans by maturity date.
Principal
Maturing
|
|
Current
Principal
|
|
|
Maturing
|
|
Within
1 year
|
|
$
|
2,691
|
|
|
|
0.03
|
%
|
Within 2 years
|
|
$
|
29,312
|
|
|
|
0.36
|
%
|
Within 3 years
|
|
$
|
186,922
|
|
|
|
2.30
|
%
|
Within 4 years
|
|
$
|
3,020,554
|
|
|
|
37.24
|
%
|
Within 5 years
|
|
$
|
4,870,598
|
|
|
|
60.06
|
%
|
TOTAL
|
|
$
|
8,110,077
|
|
|
|
|
|
All
loans are written with a fixed 5-year term (closed end) with no exceptions, providing an affordable repayment either weekly or
monthly. However, loans can be repaid early without any penalty. As the tables above show , the Company has a substantial long
duration loan book with over 90% of current loans maturing in more than two years’ time and the majority mature in the 3
to 4 year range, which is expected to continue in the future.
Loan
Underwriting
Applicants
apply online providing income, employment and banking information in the pre-approval process. The pre-approval process utilizes
a soft credit pull, electronic review of 60-90 day banking history and if the applicant successfully meets the minimum pre-approval
criteria they are invited to proceed. Upon accepting the conditional pre-approval, the applicant authorizes a full credit report
from Experian and verification of employment. Applicants are provided disclosures and privacy statements during this process.
Once
the application has been transmitted, a full credit report is obtained and the automated preliminary underwriting is completed
based on stated income and expense data obtained from the credit report. The automated preliminary underwriting includes, but
is not limited to, credit score, number of credit inquiries, outstanding unpaid collections, length of credit history, length
of employment, debt to income ratio and internet protocol, or “IP,” address to verify location of applicant.
The
second step in the underwriting process for those applicants that are conditionally approved based on stated income, credit score,
number of credit inquires, outstanding unpaid collections, length of credit history and length of employments, debt to income
ratio, IP address, is to validate the actual income (current pay invoices and prior year W-2) and a review of the 60-90 day read-only
statements from the applicant’s primary bank for satisfactory money management. During this process the pay invoices are
reviewed for garnishments, hardship loans and other legal liens allowed on wages. Bank statements are transmitted electronically
directly to underwriting to ensure the integrity of the information. This process allows the underwriter to review the money management
of every applicant and to assess the ability to take on additional expense. It also provides the underwriter with additional debt
not found on traditional credit reports such as payday loans, title loans and IRS payments that could affect the ability of the
applicant to assume additional debt. If all conditions are met as it relates to money management, maximum debt to income, minimum
length of employment, and satisfactory credit history the underwriter recommends final approval and request to draw documents.
The
final step in the underwriting process is to present the completed file to the Chief Credit Officer for final approval and order
to draw documents. The file is then reviewed for any exceptions to policy, compliance with the underwriting policies and to ensure
the loan system is reflective of what has been presented by the underwriter. The applicant is then approved for a $5,000 or $10,000
loan based on income, ability to repay and credit strength. Rate and loan terms are fixed (fixed rate and fixed term can vary
based on regulatory state maximums) as we do not utilize risk based variable pricing models eliminating the risk of discrimination
and other compliance related issues.
The
closing process is completed by contacting the applicant, communicating the lending decision and reviewing loan terms and conditions.
Upon acceptance an identity check using Experian’s Precise Identity Screening is completed and if successful loan documents
are emailed for electronic signature, and returned to us for final verifications, document review and funding.
Servicing
All
of our loan servicing is handled in our centralized Las Vegas head office. All servicing and collection activity is conducted
and documented using an industry standard loan service software system which handles and records all records and transactions
of loan originations, loan servicing, collections and reporting.
Our
primary third-party servicing arrangement is with CyberRidge, LLC, a company that licenses its consumer loan software to us. We
use this software for our loan management system. We have a servicing agreement with CyberRidge, LLC which renews automatically
unless either party notifies the other, at least 60 days prior to the end of the renewal term. We believe the risk of termination
is low as we are a paying customer of CyberRidge, LLC and have maintained a positive working relationship since 2012. In the unlikely
event that the agreement was terminated, we believe 60 days’ notice would be sufficient to find a suitable replacement with
minimal disruption to our business.
Portfolio
Ledger Stratification as at June 30, 2017
|
|
Current
Unpaid
Principal Balance
|
|
|
%
|
|
0 - 30 days
|
|
$
|
5,369,484
|
|
|
|
89.2
|
%
|
31 - 60 days
|
|
|
191,151
|
|
|
|
3.2
|
%
|
61 - 90 days
|
|
|
121,734
|
|
|
|
2.0
|
%
|
91 - 184 days
|
|
|
335,563
|
|
|
|
5.6
|
%
|
Total
|
|
$
|
6,017,932
|
|
|
|
100
|
%
|
At
June 30, 2017, we also had 74 loans delinquent or in default (defined as 91+ days past due) representing 5.58%
of the number of loans in our active portfolio. Loans become eligible for lender to take legal action at 60 days past due.
Regulation
Consumer
loans in the United States are regulated at both the federal and state level. National oversight is provided by the Federal Trade
Commission, which enforces the following credit laws that protect consumers’ rights to get, use and maintain credit:
|
●
|
The
Truth in Lending Act promotes the informed use of consumer credit, by requiring disclosures about its terms and cost to standardize
the manner in which costs associated with borrowing are calculated and disclosed.
|
|
|
|
|
●
|
The
Fair Credit Reporting Act promotes the accuracy and privacy of information in the files of the nation’s credit reporting
companies. If a company denies an application, under the Fair Credit Reporting Act consumers have the right to the name and
address of the credit reporting company they contacted, provided the denial was based on information given by the credit reporting
company.
|
|
|
|
|
●
|
The
Equal Opportunity Credit Act prohibits credit discrimination on the basis of sex, race, marital status, religion, national
origin, age, or receipt of public assistance. Creditors may ask for this information (except religion) in certain situations,
but they may not use it to discriminate against consumers when deciding whether to grant you credit.
|
|
|
|
|
●
|
The
Fair Credit Billing Act and Electronic Fund Transfer Act establish procedures for resolving mistakes on credit billing and
electronic fund transfer account statements.
|
|
|
|
|
●
|
The
Fair Debt Collection Practices Act (the “FDCPA”) applies to personal, family, and household debts. The FDCPA prohibits
debt collectors from engaging in unfair, deceptive, or abusive practices while collecting these debts.
|
In
addition, the CFPB, a federal oversight body organized in connection with the Dodd-Frank Act has broad authority over our business.
The CFPB is a new agency which commenced operations in 2011, and there continues to be uncertainty as to how the agency’s
actions or the actions of any other new agency could impact our business or that of our issuing banks. The CFPB has the authority
to write regulations under federal consumer financial protection laws, such as the Truth in Lending Act and the Equal Credit Opportunity
Act, and to enforce those laws against and examine financial institutions for compliance. The CFPB is authorized to prevent “unfair,
deceptive or abusive acts or practices” through its regulatory, supervisory and enforcement authority. To assist in its
enforcement, the CFPB maintains an online complaint system that allows consumers to log complaints with respect to various consumer
finance products, including the loan products we facilitate. This system could inform future CFPB decisions with respect to its
regulatory, enforcement or examination focus.
We
are subject to the CFPB’s jurisdiction, including its enforcement authority, as a servicer and acquirer of consumer credit.
The CFPB may request reports concerning our organization, business conduct, markets and activities. The CFPB may also conduct
on-site examinations of our business on a periodic basis if the CFPB were to determine, through its complaint system, that we
were engaging in activities that pose risks to consumers.
There
continues to be uncertainty as to how the CFPB’s strategies and priorities, including in both its examination and enforcement
processes, will impact our businesses and our results of operations going forward. Actions by the CFPB could result in requirements
to alter or cease offering affected loan products and services, making them less attractive and restricting our ability to offer
them.
Consumer
loans are also regulated at the state level, and the regulatory requirements vary between states. We are licensed in the following
states:
|
●
|
Alabama
(Consumer Credit License, No. MC 22125, which commenced on August 13, 2015)
|
|
|
|
|
●
|
Arizona
(Consumer Lender License, No. CL0918180, which commenced on May 20, 2011)
|
|
|
|
|
●
|
California
(Finance Lender License, No. 60 DBO 35873, which commenced on July 7, 2015)
|
|
|
|
|
●
|
Florida
(Consumer Finance Company License, No. CF9900865, which commenced on August 29, 2011)
|
|
|
|
|
●
|
Georgia
(Certificate of Authority, No. 14021183, which commenced on March 4, 2014)
|
|
|
|
|
●
|
Illinois
(Consumer Installment Loan License, No. CI3095, which commenced on April 13, 2011)
|
|
|
|
|
●
|
Kentucky
(Consumer Finance License, No. CL327249, which commenced on December 17, 2015)
|
|
|
|
|
●
|
Louisiana
(License No. 1226052-980840, which was issued on October 2, 2015)
|
|
|
|
|
●
|
Maryland
(License No. 2307, which commenced on October 25, 2016)
|
|
|
|
|
●
|
Missouri
(Consumer Installment Loan License, No. 510-15-7308, which commenced on April 7, 2014)
|
|
|
|
|
●
|
Nevada
(Installment Loan License, No. II22748, which commenced on June 15, 2010)
|
|
|
|
|
●
|
New
Jersey (Consumer Lender License, No. L066960, which commenced on April 24, 2014)
|
|
|
|
|
●
|
New
Mexico (Certificate of Authority, No. 5012554, which commenced on January 29, 2015
)
|
|
|
|
|
●
|
Ohio
(License No. SL
400243, which commenced on December 21,
2016)
|
|
|
|
|
●
|
Oregon
(Consumer Finance License, No. 0407-001-C, which commenced on January 8, 2015)
|
|
|
|
|
●
|
Pennsylvania
(Consumer Lender License, No. 49269, which commenced on December 23, 2014)
|
|
|
|
|
●
|
Texas
(Regulated Lender License, No. 1400031843-150319, which commenced on November 14, 2014)
|
|
|
|
|
●
|
Utah
(Consumer Lender License which commenced on February 5, 2015)
|
|
|
|
|
●
|
Virginia
(Certificate of Authority, No. CIS0368, which commenced on March 5, 2014)
|
|
|
|
|
●
|
Wisconsin (Loan
Company License, No. 3051, which commenced on June 19, 2017)
|
State
licensing statutes impose a variety of requirements and restrictions on us, including:
|
●
|
record-keeping
requirements;
|
|
|
|
|
●
|
restrictions
on servicing practices, including limits on finance charges and fees;
|
|
|
|
|
●
|
disclosure
requirements;
|
|
|
|
|
●
|
examination
requirements;
|
|
|
|
|
●
|
surety
bond and minimum net worth requirements;
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financial
reporting requirements;
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notification
requirements for changes in principal officers, stock ownership or corporate control;
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restrictions
on advertising; and
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review
requirements for loan forms.
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The
statutes also subject us to the supervisory and examination authority of state regulators in certain cases.
We
did not incur any costs in connection with the compliance with any federal, state, or local environmental laws.
Competition
We
operate in a highly competitive environment. Several personal consumer loan companies operate in the United States. Our competitors
include:
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large,
publicly-traded, state-licensed personal loan companies,
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peer-to-peer
lending companies, such as Lending Club and Prosper,
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online
personal loan companies, such as Avant,
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“brick
and mortar” personal loan companies, including those that have implemented websites to facilitate online lending, and
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payday
lenders, tribal lenders and other online consumer loan companies.
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We
believe we compete based on affordable repayment terms, favorable interest rates and low overhead due to on-line distribution.
We believe that in the future we will face increased competition from these companies as we expand our operations. Most of the
entities against which we compete, or may compete, are larger and have greater financial resources than us. No assurance can be
given that increased competition will not have an adverse effect on our company.
Office
Location
Our
executive office, which also serves as our centralized operational headquarters and Nevada branch, is located at 6160 West Tropicana
Ave., Suite E-13, Las Vegas, Nevada 89103. This facility occupies a total of approximately 2,125 square feet under a lease that
expires in September 2017 and will not be renewed. Our annual rental cost for this facility is approximately $56,313, plus
a proportionate share of operating expenses of approximately $12,112 annually.
On
August 1, 2017, we entered into a new headquarters lease for a property at 3960 Howard Hughes Parkway, Las Vegas, NV, with a term
beginning on October 1, 2017 and expiring on September 30, 2020. Monthly rental payments under this lease are $5,794, plus a pro
rata share of operating expenses and property taxes. We believe this facility is adequate for our current and near term future
needs.
Employees
As
of August 10, 2017, we had five full-time employees and one part-time employee. None of our employees is represented by
a union. We consider our relations with our employees to be good.
Corporate
History
We
were organized as a Florida corporation on January 21, 1999, under the name Interact Technologies, Inc. (“Interact”).
Interact was formed for the purpose of acquiring certain medical technology. On February 18, 1999, we changed our name to Fairhaven
Technologies, Inc. (“Fairhaven”). Fairhaven’s business plan continued to involve the acquisition of certain
medical technology. By June 1999, Fairhaven abandoned its business plan and had no operations until December 2001. On December
14, 2001, we changed our name to Ideal Accents, Inc. Ideal Accents, Inc. was engaged primarily in the business of accessorizing
cars and trucks at the new vehicle dealer level. Ideal Accents, Inc. ceased operations in 2005. IEC, our wholly owned subsidiary,
commenced operations in 2010 and in February 2013, we changed our name to IEG Holdings Corporation.
In
2005, Mr. Mathieson, our Chief Executive Officer and sole director , founded IEG in Sydney, Australia. IEG launched the
Amazing Loans business in Australia in 2005 and the Mr. Amazing Loans business in the United States via IEGC in 2010. From 2005
until 2012, Mr. Mathieson operated the Amazing Loans business through IEG in Australia. In 2012 following an extensive cost/benefit
analysis, IEG’s management made a strategic decision to focus on its U.S. operations and cease its Australian operations.
Management concluded that it should cease Australian operations due to the following:
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a lack of funding
opportunities for non-U.S. loan receivables,
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the difficulties
of operating in the Australian time zone compared to the Las Vegas time zone of its principal executive offices,
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the Australian requirement
to maintain a specific Australian lending license for Australian operations or to utilize expensive outsourcing for licensing,
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the small size of
the Australian consumer finance market as compared to the U.S. market (approximately 1/100
th
of the size),
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the lack of automation
opportunities in Australia due to the absence of instant access to FICO credit score information and other significant data
only available for U.S. residents,
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the significant
extra cost and time requirements to provide audited accounts for any non-Australian operations,
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significantly different/expensive
website and documentation requirements for Australia, and
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the perceived reticence
of U.S. investors to invest in Australian operations (mainly due to an unwillingness to travel to Australia for due diligence
purposes).
|
Accordingly,
IEG ceased doing business in Australia in 2012.
On
January 28, 2013, IEGC entered into a stock exchange agreement (the “Stock Exchange Agreement”) among IEGC, its sole
stockholder, IEG, and our company. Under the terms of the Stock Exchange Agreement, we agreed to acquire a 100% interest in IEGC
for 272,447 shares of our common stock after giving effect to a 1-for-6 reverse stock split (also adjusted for the 1-for-100 reverse
stock split that took effect June 17, 2015 and the net 1-for-10 reverse stock split that was effective on October 27, 2016). On
February 14, 2013, we filed an amendment to our articles of incorporation, as amended, with the Secretary of State of Florida
which had the effect of:
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●
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changing
our name from Ideal Accents, Inc. to IEG Holdings Corporation,
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increasing
the number of shares of our authorized common stock to 1,000,000,000, $0.001 par value,
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creating
50,000,000 shares of “blank-check” preferred stock, and
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effecting
the Reverse Stock Split pursuant to the terms of the Stock Exchange Agreement.
|
FINRA
approved the amendment to our articles of incorporation, as amended, on March 11, 2013.
On
March 13, 2013, we completed the acquisition of IEGC under the terms of the Stock Exchange Agreement and issued to IEG 272,447
shares of our common stock after giving effect to the Reverse Stock Split whereby we acquired a 100% interest in IEGC. The stock
exchange agreement between IEGC, IEG and IEG Holdings resulted in a reverse acquisition with a public shell, with IEGC being the
accounting acquirer. IEG Holdings issued 90 shares of its common stock to the stockholders of IEG (IEG transferred its ownership
in IEGC to its stockholders, which is why the shares were issued to the ultimate stockholders of IEG rather than to IEG itself)
for each share of IEGC, in exchange for 100% ownership interest in IEGC. We determined that IEGC was the accounting acquirer because
of the following facts and circumstances:
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1.
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After
consummation of the transaction, the ultimate stockholders of IEGC own 99.1% of the outstanding shares of IEG Holdings;
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2.
|
The
board of directors of IEG Holdings immediately after the transaction is comprised exclusively of former directors of IEGC;
and
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3.
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The
operations of IEG Holdings immediately after the transaction are those of IEGC.
|
After
completing the Stock Exchange Agreement and terminating all Australian operations via the sale of the remaining loan book, IEG
entered into voluntary liquidation on June 25, 2014. In August 2015, IEGC assigned all of its tangible and intangible assets to
IEG Holdings and IEGC was dissolved.
On
May 1, 2015, we filed articles of amendment to our amended and restated articles of incorporation, as amended, with the Secretary
of State of Florida. The amendment was approved by FINRA, and became effective, on June 17, 2015. The articles of amendment effected
(i) a 1-for-100 reverse stock split, and (ii) an increase in our authorized capital stock from 2,550,000,000 shares to 3,050,000,000
shares, of which 3,000,000,000 shares are common stock and 50,000,000 are preferred stock.
On
September 10, 2015, we filed articles of amendment to our amended and restated articles of incorporation, as amended, with the
Secretary of State of Florida. The articles of amendment had the effect, among other things, of adjusting the conversion ratio
of the Series H preferred stock, from 1,333/100,000 (0.01333) to 2,666/100,000 (0.02666) shares of common stock for each Series
H preferred share, to account for the Company’s offering to existing stockholders of the Company commenced August 3, 2015.
On
December 1, 2015, we filed articles of amendment to our amended and restated articles of incorporation, as amended, with the Secretary
of State of Florida. The articles of amendment had the effect, among other things, of adjusting the conversion ratio of the Series
H preferred stock, from 2,666/100,000 (0.02666) to 5,332/100,000 (0.05332) shares of common stock for each Series H preferred
share, to account for the Company’s offering to existing stockholders of the Company commenced December 1, 2015.
On
January 8, 2016, we filed articles of amendment to our amended and restated articles of incorporation, as amended, with the Secretary
of State of Florida. The articles of amendment had the effect, among other things, of adjusting the conversion ratio of the Series
H preferred stock, from 5,332/100,000 (0.05332) to 0.1 shares of common stock for each Series H preferred share, to account for
the Company’s offering to existing stockholders of the Company commenced January 8, 2016.
On
March 22, 2016, we filed articles of amendment to our amended and restated articles of incorporation, as amended. The amendment
had the effect, among other things, of adjusting the conversion ratio of the Series H preferred stock from 0.1 shares to 0.2 shares
of common stock for each Series H preferred share, to account for our offering to existing stockholders commenced March 16, 2016.
Effective
April 1, 2016, we amended our amended and restated articles of incorporation, as amended, in order to effect a 1-for-100 reverse
stock split. No fractional shares were issued. Rather, we paid stockholders who would have received a fractional share an amount
equal to the average closing price per share of our common stock on the OTCQB, averaged over the period of 30 consecutive calendar
days ending on (and including) April 1, 2016. In addition, after the reverse stock split was effected on April 1, 2016, we amended
our amended and restated articles of incorporation, as amended, to effect (i) a 100-for-1 forward stock split, and (ii) a reduction
in the number of authorized shares of common stock from 3 billion to 200 million.
On
May 16, 2016, we filed articles of amendment to our amended and restated articles of incorporation, as amended, with the Secretary
of State of Florida. The articles of amendment had the effect, among other things, of:
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(i)
|
Reducing
the dividend rate on our Series H preferred stock from 10% per annum to 8% per annum,
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(ii)
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Extending
the date after which we may redeem the unconverted outstanding shares of Series H preferred stock from June 30, 2016 to December
31, 2016,
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(iii)
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Extending
the date on which the holders of our Series H preferred stock may convert their shares into shares of our common stock from
June 30, 2016 to December 31, 2016, and
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(iv)
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Removing
the requirement to adjust the Series H preferred stock conversion ratio when we conduct a rights offering to our existing
stockholders.
|
On
October 12, 2016, we filed articles of amendment to our amended and restated articles of incorporation, as amended, with the Secretary
of State of Florida. The articles of amendment had the effect of:
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(i)
|
Adjusting
the conversion ratio of the Series H preferred stock, from two to 0.2 shares of common stock for each Series H preferred share,
to account for Company’s reverse/forward split effective October 27, 2016, and
|
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(ii)
|
Amending
the redemption date of the Series H preferred stock from “[a]ny time after the December 31, 2016” to “[a]ny
time after 6:00 p.m. Eastern time on December 31, 2016.”
|
Effective
October 27, 2016, we effected a reverse stock split of our outstanding shares of common stock, at the ratio of 1-for-1,000. No
fractional shares were issued. Rather, we paid stockholders who would have received a fractional share an amount equal to the
average closing price per share of our common stock on the OTCQX, averaged over the period of 30 consecutive calendar days preceding
the reverse stock split. Immediately following the completion of the reverse stock split, we effected a forward stock split of
our common stock on a 100-for-1 share basis and a reduction of the number of authorized shares of common stock from 200,000,000
to 40,000,000.
Effective
December 5, 2016, we increased our number of authorized shares of common stock from 40,000,000 to 300,000,000.
Recent
Developments
LendingClub Corporation Tender Offer
On
July 12, 2017, the Company filed a registration statement on Form S-4 (the “S-4 Registration Statement”) and a Schedule
TO relating to the Company’s offer to exchange four shares of the Company’s common stock for each share of common
stock of LendingClub Corporation (“Lending Club”), par value $0.01 per share, up to an aggregate of 40,345,603 shares
of Lending Club common stock, representing approximately 9.99% of Lending Club’s outstanding shares as of April 28, 2017,
validly tendered and not properly withdrawn in the offer (the “Lending Club Tender Offer”). The Lending Club Tender
Offer and the withdrawal rights were set to expire at 5:00 p.m., Eastern time, on August 10, 2017, unless extended.
Following
the launch of the Lending Club Tender Offer, the Company’s per share stock price, as quoted on the OTCQB, dropped significantly.
On August 1, 2017, due to the stock price drop, the Company determined that the Lending Club Tender Offer no longer had a reasonable
chance of success and accordingly, the Company determined that it would terminate the Lending Club Tender Offer and withdraw the
S-4 Registration Statement. Furthermore, the Company has no intention of launching the Lending Club Tender Offer or another tender
offer in the near future. Any shares that have been tendered by Lending Club stockholders have not yet been accepted and will
be returned to the relevant stockholders.
Abandonment
of Reverse-Forward Stock Split and Cash-Out
On
June 21, 2017, the Company filed with the Securities and Exchange Commission (the “Commission”) a preliminary information
statement on Schedule 14C (the “Preliminary Information Statement”). The Preliminary Information Statement, though
not in definitive form, related to a vote by the Company’s sole director and holder of a majority of the voting power of
the issued and outstanding capital stock of the Company to effect a reverse 1-for-1,000 stock split (the “Reverse Split”),
followed immediately by a forward 1,000-for-1 stock split (the “Forward Split”) of the Company’s common stock.
The Company’s intention was that registered shareholders whose shares of stock were converted into less than one share in
the Reverse Split would receive cash payments equal to the fair value of those fractional interests. The Reverse Split and Forward
Split, together with the related cash payments to shareholders with less than 1,000 shares of common stock prior to the Reverse
Split are referred to herein as the “Reverse/Forward Split.”
On
July 18, 2017, the Company determined that it will not effect the Reverse/Forward Split at this time. Furthermore, the Company
has no intention of effecting the Reverse/Forward Split or any other reverse and/or forward split in the near future. For avoidance
of doubt, no reverse and/or forward split occurred on July 25, 2017, as originally disclosed in the Preliminary Information Statement,
and no stockholders were cashed out on July 25, 2017. Stockholders should disregard the Preliminary Information Statement that
was filed with the Commission in its entirety.
The
Company’s determination to abandon the Reverse/Forward Split was based on the Company’s launch, on July 12, 2017,
of the Lending Club Tender Offer. The Company launched the Lending Club Tender Offer on July 12, 2017, subsequent to the filing
of the Preliminary Information Statement with the Commission on June 21, 2017. The primary goal of the Reverse/Forward Split was
cost savings from reducing administrative costs associated with reducing shareholder accounts. The Company expected that a significant
number of new shareholders may have been obtained in connection with the Lending Club Tender Offer, including those holding fewer
than 1,000 shares. As a result, the Company determined that any expected cost savings may no longer be sufficient to justify proceeding
with the Reverse/Forward Split. Although the Company determined, on August 1, 2017, that it would abandon the Lending Club Tender
Offer, the Company does not intend to effect the Reverse/Forward Split or any other reverse and/or forward split in the near future.
The Company notes that previously completed reverse/forward stock splits have achieved substantial administrative cost savings,
and have not been designed for the purpose of “going private”.
Stock
Repurchase Program
In
January 2017, our Board of Directors approved a stock repurchase program authorizing the open market repurchase of up to $2,000,000
of our common stock for the following reasons:
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The
stock repurchase program permits the Company to purchase shares of its common stock from time to time at prices that are below
what the Board believes to be the true value of the shares.
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●
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The
Company’s common stock is trading at close to record low prices.
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The
stock repurchase program reflects the commitment of our Board of Directors to enhance stockholder value and its confidence
in our long-term growth prospects.
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The
Board believes the stock repurchase program is a strategic investment and an appropriate use of corporate funds.
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Any
repurchases will only be effected to the extent that they do not impair the Company’s capital or the Company’s
ability to pay its debts.
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The
Company has available liquidity from existing customer loan repayments to be able to both reinvest in new customer loans and
also to strategically invest back into our company via stock repurchases.
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●
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The
stock repurchase program will assist in improving stock liquidity and ensuring a more orderly and less volatile market for
a relatively small outlay of cash.
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●
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No
purchases are required and the $2,000,000 cap on the stock repurchase program is relatively low.
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Purchases under the
program are authorized through December 31, 2017. Through August 10, 2017, an aggregate of 170,998 shares have been repurchased
under this program for an aggregate purchase price of $100,861.60.
Declaration
of Dividend
On
August 1, 2017, our sole director declared a cash dividend of $0.005 per common share for the second quarter of 2017. The dividend
is payable on August 21, 2017 to stockholders of record at the close of business on August 11, 2017.
Notes
Offering Terminated
In
December 2016, we launched a private offering of up to $10 million aggregate principal amount of our 12% senior unsecured notes
due December 31, 2026 (the “Notes”), on a self-underwritten basis. The Notes offering was terminated in May 2017.
No Notes were sold in the offering.
OneMain
Holdings, Inc. Tender Offer Closed
On
June 16, 2017, we closed our tender offer to purchase shares of common stock of OneMain Holdings, Inc. (“OneMain”),
with 151,994 OneMain shares of common stock acquired (valued at an aggregate of $3.55 million based on the closing price of shares
of OneMain common stock of $23.38 on June 15, 2017) in exchange for 3,039,880 shares of our common stock. The per share valuation
of IEG Holdings shares used in connection with the OneMain tender offer was $1.169 per IEG Holdings common share as at the close
date of the tender offer. On June 22, 2017, we sold 100% of the 151,994 shares of OneMain common stock which we obtained in our
tender offer for $3.4 million in cash. The current planned use of the proceeds from the sale of OneMain shares is to fund increased
new loan volumes in Q3 and a further use is to fund the payables to Mr. Mathieson pursuant to the terms of the consulting agreement
entered into on July 1, 2017.
Amendment
of Series H Preferred Stock
On
June 20, 2017, we filed articles of amendment (the “Amendment”) to our amended and restated articles of incorporation,
as amended (the “Articles”). The Amendment has the effect of revising the terms of the Series H preferred stock
to:
|
(1)
|
remove rights to
receive dividends on our Series H preferred stock;
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(2)
|
increase the conversion
ratio of the Series H preferred stock from 0.2 shares of Common Stock per share of Series H preferred stock to 1 share of
Common Stock per share of Series H preferred stock;
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(3)
|
remove our right
to redeem or call our Series H preferred stock;
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(4)
|
provide for automatic
conversion of Series H preferred stock into shares of our Common Stock on December 31, 2017; and
|
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(5)
|
remove the voting
rights for Series H preferred stock.
|
The
Amendment was approved by our board of directors on June 19, 2017.
In
addition, on July 26, 2017, we filed articles of amendment to our Articles that had the effect of revising the terms of the Series
H preferred stock to increase the conversion ratio of the Series H preferred stock from one share of common stock per share of
Series H preferred stock to four shares of common stock per share of Series H preferred stock. The Articles amendment was approved
by our sole director on July 26, 2017.
Legal
Proceedings
We
are not a party to any pending or threatened litigation.
Emerging
Growth Company Status
We
are an “emerging growth company” as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart
Our Business Startups Act of 2012 (the “JOBS Act”). As such, we are eligible to take advantage of certain exemptions
from various reporting requirements that are applicable to other public companies that are not “emerging growth companies”
including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley
Act of 2002 (the “Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in our periodic
reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation
and stockholder approval of any golden parachute payments not previously approved. We intend to take advantage of all of these
exemptions.
In
addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended
transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards,
and delay compliance with new or revised accounting standards until those standards are applicable to private companies. We have
elected to take advantage of the benefits of this extended transition period.
We
could be an emerging growth company until the last day of the first fiscal year following the fifth anniversary of our first common
equity offering, although circumstances could cause us to lose that status earlier if our annual revenues exceed $1.0 billion,
if we issue more than $1.0 billion in non-convertible debt in any three-year period or if we become a “large accelerated
filer” as defined in Rule 12b-2 under the Exchange Act.
Quantitative
and qualitative disclosures about market risk
The
Company does not hold any derivative instruments and does not engage in any hedging activities. The Company is not a borrower
on any loans, and the loans that we make as a lender have fixed interest rates for the term. Our business is denominated in U.S.
dollars and fluctuations in the foreign currency markets will not have any effect on our business for the foreseeable future.
We are not exposed to market risk from changes in commodity prices. We are exposed to multiple risks, including data theft, professional
liability joinder, and general operations liabilities. We may carry insurance for these risks in the future, through general liability
insurance, which will adversely affect our operations if any of these risks result in claims not covered by insurance.
MANAGEMENT
Board
of Directors and Executive Officers
The
following table sets forth the names, positions and ages of our directors and executive officers as of the date of this document.
Our directors are elected by our stockholders at each annual meeting and serve for one year and until their successors are elected
and qualified. Officers are elected by our board of directors and their terms of office are at the discretion of our board.
Name
|
|
Age
|
|
Position(s)
|
Paul
Mathieson
|
|
42
|
|
Chief
Executive Officer
& Director
|
Carla
Cholewinski
|
|
64
|
|
Chief
Operating Officer and Chief Credit Officer
|
Biographical
information concerning our director and executive officers listed above is set forth below.
Paul
Mathieson.
Mr. Mathieson has served as the Chief Executive Officer and member of our board of directors since 2012. In
2005, Mr. Mathieson founded IEG Holdings Limited in Sydney, Australia which launched the Amazing Loans business in Australia in
2005 and the Mr. Amazing Loans business in the United States through a subsidiary in 2010. In recognition of IEG Holdings Limited’s
success, Mr. Mathieson was awarded Ernst & Young’s 2007 Australian Young Entrepreneur of the Year (Eastern Region).
Mr. Mathieson has over 22 years’ finance industry experience in lending, funds management, stock market research and investment
banking. His career has included positions as Financial Analyst/Institutional Dealer with Daiwa Securities from 1995 to 1995,
Head of Research for Hogan & Partners Stockbrokers from 1995 to 2000, and Investment Banking Associate with ING Barings from
2000 to 2001. In addition, from 2002 to 2010, Mr. Mathieson was the Founder and Managing Director of IE Portfolio Warrants, a
funds management business that offered high return and leveraged structured equities products. Mr. Mathieson received a Bachelor
of Commerce from Bond University, Queensland, Australia in 1994 and a Master’s Degree of Applied Finance from Macquarie
University, New South Wales, Australia in 2000.
Carla
Cholewinski
.
Ms. Cholewinski has served as our Chief Operating Officer since 2008 and has over 40 years’ experience
in the finance industry including banking, credit union management, regulatory oversight, debt securitization and underwriting.
Her career has included positions as Vice President and Branch Manager at Glendale Federal Bank from 1976 to 1986, Vice President
and District Sales and Lending Manager with California Federal Bank from 1986 to 1992, Mortgage Banker with First Choice Financial
Services from 1992 to 1995, Corporate Vice President of Lending and Collections with WestStar Credit Union from 1995 to 1999,
Chief Lending Officer for American Corp & Funding from 1999 to 2000, Chief Credit Officer for Security State Savings Bank
from 2000 to 2004, and Chief Credit Officer for Fifth Street Bank from 2004 to 2008. Since 2008, Ms. Cholewinski has served as
our Chief Operating Officer and Chief Credit Officer and has utilized her extensive finance, banking and regulatory experience
to grow the business from initial launch to our current level of operations.
There
are no family relationships between any of the executive officers and directors.
Director
Qualifications
Mr.
Mathieson was appointed to our board in March 2013 following the reverse merger with IEGC described in this document. Given his
role in the founding and/or operations of IEGC, we believe he remains a good fit for our current needs. Mr. Mathieson has significant
operational experience in our industry and brings both a practical understanding of the industry and as well as hands-on experience
in our business sector to our board and a greater understanding of certain of the challenges we face in executing our growth strategy.
Director
Compensation
Mr.
Mathieson does not receive any additional compensation for his services as a director.
Compensation
Committee Interlocks and Insider Participation
We
did not have a compensation committee during the year ended December 31, 2016. During the year ended December 31, 2016, Mr. Mathieson
participated in deliberations of our board of directors concerning executive officer compensation. No member of our board is,
or was during the fiscal year ended December 31, 2016, an officer, former officer or employee of the Company or any of its subsidiaries,
or a person having a relationship requiring disclosure by the Company pursuant to Item 404 of Regulation S-K. No executive officer
of the Company served as a member of (i) the compensation committee of another entity of which one of the executive officers of
such entity served on the Company’s compensation committee or (ii) the board of directors of another entity of which one
of the executive officers of such entity served on the Company’s Board, during the fiscal year ended December 31, 2016.
Code
of Ethics and Business Conduct
We
have adopted a Code of Ethics and Business Conduct that applies to our board of directors, our executive officers and our employees.
A copy of the Code of Ethics and Business Conduct is available on our corporate website at
www.investmentevolution.com
,
and any amendments to the Code of Ethics and Business Conduct or any waivers of its requirement related to certain matters, will
be disclosed on our website and reported to the SEC, as may be required.
EXECUTIVE
COMPENSATION
The
following table summarizes all compensation recorded by us in the past two fiscal years for each of our executive officers. For
definitional purposes, these individuals are sometimes referred to as the “named executive officers.”
2016
SUMMARY COMPENSATION TABLE
Name
and Principal Position
|
|
Year
|
|
|
Salary
($)
|
|
|
Bonus
($)
|
|
|
Stock
Awards
($)
|
|
|
Option
Awards
($)
|
|
|
Non-Equity
Incentive Plan
Compensation
($)
|
|
|
Non-Qualified
Deferred
Compensation
Earnings
($)
|
|
|
All
Other
Compensation
($)
|
|
|
Total
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Paul
Mathieson,
|
|
|
2016
|
|
|
|
1,000,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
1,000,000
|
|
Chief
Executive Officer (1)
|
|
|
2015
|
|
|
|
1,000,000
|
|
|
|
300,000
|
(1)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
1,300,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carla
Cholewinski,
|
|
|
2016
|
|
|
|
230,000
|
|
|
|
13,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
243,000
|
|
Chief
Operating Officer and Chief Credit Officer
|
|
|
2015
|
|
|
|
220,000
|
|
|
|
30,000
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
250,000
|
|
(1)
|
In
September 2015, Mr. Mathieson purchased 22,007 shares of common stock from us for an aggregate purchase price of $220,079.
The full amount of the purchase price was offset by $220,079 of his $225,000 September 2015 discretionary bonus declared by
the Board to him in September 2015 (for the period January 1, 2015 to September 30, 2015) with the $4,921 balance offset against
CEO advance. On December 31, 2015, Mr. Mathieson was paid $75,000 for his 2015 discretionary bonus declared by the Board to
him (for the period October 1, 2015 to December 31, 2015). The material factors considered by our board in awarding the total
bonus to Mr. Mathieson were the substantial expansion in the loan book and the significant increase in revenues of the business
in the relevant period.
|
Employment
Agreements
We
are not currently a party to any employment agreements with any of our executive officers. However, IEG Holdings entered into
a professional consulting contract with Mr. Mathieson on September 30, 2015 with an effective date as of January 1, 2015 (the
“2015 Consulting Contract”). Pursuant to the terms of the 2015 Consulting Contract, Mr. Mathieson agreed to provide
regulatory and management consulting services as requested by IEG Holdings, including services to be provided by IEG Holdings
to Investment Evolution Corporation. The 2015 Consulting Contract has a term of one year and renews automatically for one year
periods unless notice of termination is provided 30 days prior to the automatic renewal date. In exchange for Mr. Mathieson’s
services, IEG Holdings agreed to pay Mr. Mathieson $1,000,000 annually and a discretionary bonus to be determined by IEG Holdings’
board of directors. Pursuant to the terms of the 2015 Consulting Contract, the IEG Holdings’ board of directors authorized
a portion in the amount of $225,000 of the 2015 bonus to be paid to Mr. Mathieson on September 30, 2015 for services previously
rendered by Mr. Mathieson from January 1, 2015 to September 30, 2015. In addition, the IEG Holdings’ board of directors
authorized a final portion in the amount of $75,000 of the 2015 bonus to be paid to Mr. Mathieson on December 31, 2015 for services
previously rendered by Mr. Mathieson from October 1, 2015 to December 31, 2015.
On
November 2, 2016, we and Mr. Mathieson agreed to terminate, effective December 31, 2016, the 2015 Consulting Contract. Also on
November 2, 2016, Investment Evolution Corporation, a wholly owned subsidiary of the Company (“IEC”), and Mr. Mathieson
entered into a professional consulting contract, effective January 1, 2017 (the “2017 Consulting Contract”). Pursuant
to the terms of the 2017 Consulting Contract, Mr. Mathieson agreed to provide regulatory and management consulting services as
requested by the Company and/or IEC. The 2017 Consulting Contract has a term of one year and renews automatically for one year
periods unless notice of termination is provided 30 days prior to the automatic renewal date. In exchange for Mr. Mathieson’s
services, the Company agreed to pay Mr. Mathieson $1.00 annually and a discretionary bonus to be determined by the Company’s
board of directors.
On
July 1, 2017, we and Mr. Mathieson agreed to terminate, effective July 1, 2017, the 2017 Consulting Contract. Also on July 1,
2017, IEC and Mr. Mathieson entered into a professional consulting contract, effective July 1, 2017 (the “July 2017 Consulting
Contract”). Pursuant to the terms of the July 2017 Consulting Contract, Mr. Mathieson agreed to provide regulatory and management
consulting services as requested by the Company and/or IEC. The July 2017 Consulting Contract has a term of 1.5 years and renews
automatically for one year periods unless notice of termination is provided 30 days prior to the automatic renewal date. In exchange
for Mr. Mathieson’s services, the Company agreed to pay Mr. Mathieson $1,200,000 annually and a discretionary bonus to be
determined by the Company’s board of directors.
Outstanding
Equity Awards at 2016 Fiscal Year-End
The
following table provides information concerning unexercised options, stock that has not vested and equity incentive plan awards
for each named executive officer outstanding as of December 31, 2016:
OPTION
AWARDS
|
|
STOCK
AWARDS
|
|
Name
|
|
Number
of
Securities
Underlying
Unexercised
Options (#)
Exercisable
|
|
|
Number
of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
|
|
|
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)
|
|
|
Option
Exercise
Price
($)
|
|
|
Option
Expiration
Date
|
|
|
Number
of
Shares
or
Units of
Stock
That
Have
Not
Vested
(#)
|
|
|
Market
Value
of
Shares
or
Units
of
Stock
That
Have
Not
Vested
($)
|
|
|
Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units or
Other
Rights
that Have
Not
Vested
(#)
|
|
|
Equity
Incentive
Plan
Awards:
Market
or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested
(#)
|
|
Paul
Mathieson
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Carla
Cholewinski
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Limitation
on Liability
The
Florida Business Corporation Act permits the indemnification of directors, employees, officers and agents of Florida corporations.
Our amended and restated articles of incorporation, as amended, and our amended and restated bylaws provide that we will indemnify
our directors and officers to the fullest extent permitted by the Florida Business Corporation Act.
The
provisions of the Florida Business Corporation Act that authorize indemnification do not eliminate the duty of care of a director,
and in appropriate circumstances equitable remedies such as injunctive or other forms of non-monetary relief will remain available
under Florida law. In addition, each director will continue to be subject to liability for:
●
|
violations
of criminal laws, unless the director had reasonable cause to believe his conduct was lawful or had no reasonable cause to
believe his conduct was unlawful,
|
|
|
●
|
deriving
an improper personal benefit from a transaction,
|
|
|
●
|
voting
for or assenting to an unlawful distribution, and
|
|
|
●
|
willful
misconduct or conscious disregard for our best interests in a proceeding by or in the right of a stockholder.
|
The
statute does not affect a director’s responsibilities under any other law, such as the Federal securities laws. The effect
of the foregoing is to require our company to indemnify our officers and directors for any claim arising against such persons
in their official capacities if such person acted in good faith and in a manner that he reasonably believed to be in or not opposed
to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe
his conduct was unlawful.
Insofar
as the limitation of, or indemnification for, liabilities arising under the Securities Act may be permitted to directors, officers,
or persons controlling us pursuant to the foregoing, or otherwise, we have been advised that, in the opinion of the SEC, such
limitation or indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
We
do not have a written policy for the review, approval or ratification of transactions with related parties or conflicted transactions.
When such transactions arise, they are referred to our board of directors for its consideration.
IEG
Holdings entered into a professional consulting contract with Mr. Mathieson on September 30, 2015 with an effective date as of
January 1, 2015 (the “2015 Consulting Contract”). Pursuant to the terms of the 2015 Consulting Contract, Mr. Mathieson
agreed to provide regulatory and management consulting services as requested by IEG Holdings, including services to be provided
by IEG Holdings to Investment Evolution Corporation. The 2015 Consulting Contract has a term of one year and renews automatically
for one year periods unless notice of termination is provided 30 days prior to the automatic renewal date. In exchange for Mr.
Mathieson’s services, IEG Holdings agreed to pay Mr. Mathieson $1,000,000 annually and a discretionary bonus to be determined
by IEG Holdings’ board of directors. Pursuant to the terms of the 2015 Consulting Contract, the IEG Holdings’ board
of directors authorized a portion in the amount of $225,000 of the 2015 bonus to be paid to Mr. Mathieson on September 30, 2015
for services previously rendered by Mr. Mathieson from January 1, 2015 to September 30, 2015. In addition, the IEG Holdings’
board of directors authorized a final portion in the amount of $75,000 of the 2015 bonus to be paid to Mr. Mathieson on December
31, 2015 for services previously rendered by Mr. Mathieson from October 1, 2015 to December 31, 2015. Mr. Mathieson did not receive
a bonus for the year ended December 31, 2016.
On
November 2, 2016, we and Mr. Mathieson agreed to terminate, effective December 31, 2016, the 2015 Consulting Contract. Also on
November 2, 2016, IEC , and Mr. Mathieson entered into a professional consulting contract, effective January 1, 2017 (the
“2017 Consulting Contract”). Pursuant to the terms of the 2017 Consulting Contract, Mr. Mathieson agreed to provide
regulatory and management consulting services as requested by the Company and/or IEC. The 2017 Consulting Contract has a term
of one year and renews automatically for one year periods unless notice of termination is provided 30 days prior to the automatic
renewal date. In exchange for Mr. Mathieson’s services, the Company agreed to pay Mr. Mathieson $1.00 annually and a discretionary
bonus to be determined by the Company’s board of directors.
On
July 1, 2017, we and Mr. Mathieson agreed to terminate, effective July 1, 2017, the 2017 Consulting Contract. Also on July 1,
2017, IEC and Mr. Mathieson entered into a professional consulting contract, effective July 1, 2017 (the “July 2017 Consulting
Contract”). Pursuant to the terms of the July 2017 Consulting Contract, Mr. Mathieson agreed to provide regulatory and management
consulting services as requested by the Company and/or IEC. The July 2017 Consulting Contract has a term of 1.5 years and renews
automatically for one year periods unless notice of termination is provided 30 days prior to the automatic renewal date. In exchange
for Mr. Mathieson’s services, the Company agreed to pay Mr. Mathieson $1,200,000 annually and a discretionary bonus to be
determined by the Company’s board of directors.
Chief
Executive Officer
Compensation
to our Chief Executive Officer under the 2015 Consulting Contract totaled $1,000,000 for the year ended December 31, 2016.
Chief
Operating Officer
Compensation
to our Chief Operating Officer totaled $243,000 for the year ended December 31, 2016.
Consulting
Fees
During
the year ended December 31, 2016, the Company incurred director fees totaling $29,800 to Matthew Banks, who is a former director
of IEG Holdings Corporation.
During
the year ended December 31, 2016, the Company incurred director fees totaling $29,800 to R & H Nominees Pty Ltd, which is
owned by Harold Hansen, who is a former director of IEG Holdings Corporation.
During
the year ended December 31, 2016, the Company incurred consulting fees totaling $26,000 to Custom Print Consulting, who is a shareholder
of IEG Holdings Corporation, and related entities. All of the $26,000 was offset as consideration for common stock subscriptions.
During
the year ended December 31, 2016, the Company incurred consulting fees totaling $26,000 to BW Equities Pty Ltd, who is a shareholder
of IEG Holdings Corporation, and related entities. All of the $26,000 was offset as consideration for common stock subscriptions.
During
the year ended December 31, 2016, the Company incurred consulting fees totaling $162,500 to Worldwide Holdings LLC, who is a shareholder
of IEG Holdings Corporation, and related entities. $150,000 of the $162,500 consulting fees incurred was paid, with the remaining
$12,500 offset as consideration for common stock subscriptions.
During
the year ended December 31, 2016, the Company incurred consulting fees totaling $166,524 to MZHCI LLC, who is a shareholder of
IEG Holdings Corporation, and related entities. $96,524 of the $166,524 consulting fees incurred was paid, with the remaining
$70,000 offset as consideration for common stock subscriptions.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table sets forth certain information regarding beneficial ownership of our common stock as of August 10, 2017,
by:
|
●
|
Each
person known by us to be the beneficial owner of more than 5% of our outstanding common stock,
|
|
|
|
|
●
|
Each
director and each of our named executive officers, and
|
|
|
|
|
●
|
All
executive officers and directors as a group.
|
As
of August 10, 2017, there were 12,754,066 shares of our common stock outstanding.
The
number of shares of common stock beneficially owned by each person is determined under the rules of the SEC and the information
is not necessarily indicative of beneficial ownership for any other purpose. Under such rules, beneficial ownership includes any
shares as to which such person has sole or shared voting power or investment power and also any shares which the individual has
the right to acquire within 60 days after August 10, 2017, through the exercise of any stock option, warrant or other right.
Unless otherwise indicated, each person has sole investment and voting power (or shares such power with his or her spouse) with
respect to the shares set forth in the following table. The inclusion herein of any shares deemed beneficially owned does not
constitute an admission of beneficial ownership of those shares. Unless otherwise indicated, the business address of each person
listed is in care of IEG Holdings Corporation, 6160 West Tropicana Ave., Suite E-13, Las Vegas, NV 89103.
Name
|
|
Position
|
|
Amount
and
Nature of
Beneficial
Ownership
|
|
|
Percent
of
Class
|
|
Named Executive Officers and Directors:
|
|
|
|
|
|
|
|
|
|
|
Paul Mathieson
|
|
Chief Executive Officer and
Director
|
|
|
6,900,000
|
|
|
|
54.1
|
%
|
Carla Cholewinski
|
|
Chief Operating Officer and Chief Credit Officer
|
|
|
2,000
|
|
|
|
*
|
|
All executive officers and directors as a group
(2 persons)
|
|
|
|
|
6,902,000
|
|
|
|
54.1
|
%
|
*
Less than 1%.
Securities
Authorized for Issuance under Equity Compensation Plans
The
following table sets forth securities authorized for issuance under any equity compensation plans approved by our stockholders
as well as any equity compensation plans not approved by our stockholders as of December 31, 2016.
Plan
category
|
|
|
Number
of securities to be issued upon exercise of outstanding options, warrants and rights (a)
|
|
|
|
Weighted
average exercise price of outstanding options, warrants and rights
|
|
|
|
Number
of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column
(a))
|
|
Plans
approved by our stockholders
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Plans
not approved by stockholders
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
DESCRIPTION
OF CAPITAL STOCK
The
following description of our capital stock is based upon our amended and restated articles of incorporation, as amended, our amended
and restated bylaws and applicable provisions of law, in each case as currently in effect. This discussion does not purport to
be complete and is qualified in its entirety by reference to our amended and restated articles of incorporation, as amended, and
our amended and restated bylaws, copies of which are filed with the SEC as exhibits to the registration statement of which this
prospectus is a part.
Authorized
Capital Stock
As
of the date of this prospectus, our authorized capital stock consists of (i) 300,000,000 shares of common stock, par value $0.001
per share, and (ii) 50,000,000 shares of preferred stock, par value $0.001 per share. At August 10, 2017, we had 12,754,066
shares of common stock issued and outstanding. As of August 10, 2017, we had no shares of Series H preferred stock issued
and outstanding. Effective June 17, 2015, the Series B, Series C, Series D and Series E preferred stock were cancelled. Effective
January 1, 2016, the Series F and Series G preferred stock were entirely converted and/or redeemed. Effective March 31, 2016,
the Series A preferred stock was entirely converted. Effective May 16, 2016, the Series A, Series F and Series G preferred stock
were cancelled. Effective December 31, 2016, all shares of Series H preferred stock were converted or redeemed.
Common
Stock
The
holders of common stock are entitled to one vote per share on all matters submitted to a vote of stockholders, including the election
of directors. There is no right to cumulate votes in the election of directors. The holders of common stock are entitled to any
dividends that may be declared by the board of directors out of funds legally available for payment of dividends subject to the
prior rights of holders of preferred stock and any contractual restrictions we have against the payment of dividends on common
stock. In the event of our liquidation or dissolution, holders of common stock are entitled to share ratably in all assets remaining
after payment of liabilities and the liquidation preferences of any outstanding shares of preferred stock. Holders of common stock
have no preemptive rights and have no right to convert their common stock into any other securities.
Preferred
Stock
The
preferred stock is issuable in one or more series with such designations, voting powers, if any, preferences and relative, participating,
optional or other special rights, and such qualifications, limitations and restrictions, as are determined by resolution of our
board of directors. The issuance of preferred stock may have the effect of delaying, deferring or preventing a change in control
of our company without further action by stockholders and could adversely affect the rights and powers, including voting rights,
of the holders of common stock.
Description
of Series H Preferred Stock
Our
amended and restated articles of incorporation, as amended, authorize 10,000,000 shares of Series H preferred stock, of which
no shares are outstanding as of August 10, 2017. There are no sinking fund provisions applicable to our Series H preferred
stock.
Ranking.
The Series H preferred stock ranks
pari passu
with any other series of preferred stock subsequently designated by IEG
Holdings and not designated as senior securities or subordinate to the Series H preferred stock.
Liquidation
Preference.
In the event of a liquidation or winding up of IEG Holdings, a holder of Series H preferred stock will be entitled
to receive $1.00 per share of Series H preferred stock.
Dividends
.
The Series H Preferred Stock is not entitled to receive dividends.
Conversion.
Holders of Series H preferred shares have the following rights with respect to the conversion of Series H preferred shares
into shares of our common stock:
|
●
|
At 5:00 pm Eastern
time on December 31, 2017, each and every share of Series H Preferred Stock issued and outstanding at such time shall automatically
and without further action of any holder thereof, convert into shares of the Company’s common stock on the basis
of four (4) shares of common stock for each share of Series H Preferred Stock.
|
|
|
|
|
●
|
Promptly after December
31, 2017, the Company shall deliver to each prior holder of Series H Preferred Stock whose shares have been converted
into shares of common stock as set forth in Section 6(A), a certificate representing the number of the Company’s
shares of common stock into which such Series H Preferred Stock has been converted.
|
|
●
|
In
the event that, prior to 5:00 p.m. on December 31, 2017, IEG Holdings completes any consolidation, merger, combination, statutory
share exchange or other transaction in which the shares of Common Stock are exchanged for or changed into other stock or securities,
money and/or any other property, then in any such case the Series H Preferred Stock shall at the same time be similarly exchanged
or changed into preferred shares of the surviving entity providing the holders of such preferred shares with (to the extent
possible) the same relative rights and preferences as the Series H Preferred Stock. For the avoidance of doubt, in the event
that any such consolidation, merger, combination, statutory share exchange or other transaction is completed after 5:00 p.m.
on December 31, 2017, the shares of Series H Preferred Stock shall have been converted into shares of Common Stock and as
such shall be exchanged for or changed into other stock or securities, money and/or any other property, as any other shares
of Common Stock.
|
Voting.
Except as provided in the immediately following sentence, Series H Preferred Stock shall have no right to vote on any matter
to come before the shareholders of IEG Holdings. The affirmative vote at a meeting duly called for such purpose or the written
consent without a meeting, of the holders of not less than fifty percent (50%) of the then outstanding Series H Preferred Stock,
shall be required for any change to IEG Holdings’ Articles of Incorporation which would amend, alter, change or repeal any
of the powers, designations, preferences and rights of the Series H Preferred Stock
Redemption
and Call Rights
. The Series H Preferred Stock have no redemption or call rights.
Anti-Takeover
Effects of Certain Provisions of Our Amended and Restated Articles of Incorporation, as Amended, and Our Amended and Restated
Bylaws
Provisions
of our amended and restated articles of incorporation, as amended, and our amended and restated bylaws could make it more difficult
to acquire us by means of a merger, tender offer, proxy contest, open market purchases, removal of incumbent directors and otherwise.
These provisions, which are summarized below, are expected to discourage types of coercive takeover practices and inadequate takeover
bids and to encourage persons seeking to acquire control of us to first negotiate with us. We believe that the benefits of increased
protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure
us outweigh the disadvantages of discouraging takeover or acquisition proposals because negotiation of these proposals could result
in an improvement of their terms.
Calling
of Special Meetings of Stockholders.
Our amended and restated bylaws provide that special meetings of the stockholders may
be called only by the board of directors or by the president, and shall be called by the president or the secretary at the request
in writing of record stockholders owning at least 10% of shares outstanding and entitled to vote.
Removal
of Directors; Vacancies.
Our amended and restated bylaws provide that a director may be removed from office with or without
cause, at any time, by the affirmative vote of a plurality of the votes of the issued and outstanding stock entitled to vote for
the election of directors, at a special meeting of the stockholders called and held for that purpose. A vacancy on the board of
directors may be filled only by stockholders at such meeting, or if the stockholders fail to fill such vacancy, by a majority
of the directors then in office.
Amendment
of Bylaws.
Our amended and restated bylaws provide that our board of directors may amend or repeal the amended and restated
bylaws, or new bylaws may be adopted by the board of directors, at any time without stockholder approval. Allowing the board to
amend our amended and restated bylaws without stockholder approval enhances board control over our bylaws.
Preferred
Stock.
Our amended and restated articles of incorporation, as amended, authorize the issuance of up to 50,000,000 shares of
preferred stock with such rights and preferences as may be determined from time to time by our board of directors in their sole
discretion. Our board of directors may, without stockholder approval, issue series of preferred stock with dividends, liquidation,
conversion, voting or other rights that could adversely affect the voting power or other rights of the holders of our common stock.
Transfer
Agent
The
transfer agent and registrar for our common stock is VStock Transfer, LLC, 18 Lafayette Place, Woodmere, NY 11598.
SELLING
STOCKHOLDERS
The
following table sets forth:
|
●
|
the
name of each of the selling stockholders,
|
|
●
|
the
number of shares of common stock beneficially owned by each such selling stockholder that may be offered for the account of
such selling stockholder under this prospectus, and
|
|
●
|
the
number of shares of common stock beneficially owned by each such selling stockholder upon completion of this offering.
|
Information
on beneficial ownership of securities is based upon a record list of our shareholders and we have determined beneficial ownership
in accordance with the rules of the SEC. We believe, based on the information furnished to us, that the persons and entities named
in the table below have sole voting and investment power with respect to all shares of common stock that they beneficially own,
subject to applicable community property laws. Based on the information provided to us by or on behalf of the selling stockholders,
no selling stockholder, and no entity listed in the footnotes to the table below, is a broker-dealer or an affiliate of a broker-dealer.
The
selling security holders may sell some or all of the securities owned by them, and there are currently no agreements, arrangements
or understandings with respect to the sale of any of the securities. The table below assumes that the selling stockholders sell
all of the shares offered for sale. The business address of each person listed is in care of IEG Holdings Corporation, 6160 West
Tropicana Ave, Suite E-13, Las Vegas, NV 89103.
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
PAUL MATHIESON (1)
|
|
|
6,900,000
|
|
|
|
54.10
|
%
|
|
|
6,900,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CLEM TACCA (2)
|
|
|
203,389
|
|
|
|
1.59
|
%
|
|
|
203,389
|
|
|
|
0
|
|
|
|
0.00
|
%
|
AARON ANDREW BLISS
|
|
|
445
|
|
|
|
*
|
|
|
|
445
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ADAM BLUME
|
|
|
2,808
|
|
|
|
*
|
|
|
|
2,808
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALAN GEOFFREY HARTLAND & ELEANOR
JOYCE HARTLAND (3)
|
|
|
756
|
|
|
|
*
|
|
|
|
756
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALAN LAMB & SANDRA GIVENS (4)
|
|
|
6,000
|
|
|
|
*
|
|
|
|
6,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALAN MCEWAN GILLESPIE
|
|
|
609
|
|
|
|
*
|
|
|
|
609
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALDO SACCO (5)
|
|
|
4,207
|
|
|
|
*
|
|
|
|
4,207
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALEX CAPOVILLA (6)
|
|
|
5,503
|
|
|
|
*
|
|
|
|
5,503
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALEXANDER K ROLLEY & LANA T ROLLEY
|
|
|
150
|
|
|
|
*
|
|
|
|
150
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALEXANDER THOMAS COCKBURN-CAMPBELL &
KERRY ANNE COCKBURN-CAMPBELL
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALEXANDRA KATE WOOD
|
|
|
430
|
|
|
|
*
|
|
|
|
430
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALICIA BREAMER KEALL (7)
|
|
|
1,737
|
|
|
|
*
|
|
|
|
1,737
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALWYN DYER & KERRYN J DYER
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ALWYN REGINALD DYER & KERRYN JEAN
DYER (8)
|
|
|
1,417
|
|
|
|
*
|
|
|
|
1,417
|
|
|
|
0
|
|
|
|
0.00
|
%
|
AMANDA HARGREAVES
|
|
|
2,325
|
|
|
|
*
|
|
|
|
2,325
|
|
|
|
0
|
|
|
|
0.00
|
%
|
AMANDA MAREE JAMES
|
|
|
400
|
|
|
|
*
|
|
|
|
400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
AMBER JAY CALLEJA
|
|
|
4,000
|
|
|
|
*
|
|
|
|
4,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANDREW CARSON & MAXINE CARSON (9)
|
|
|
491
|
|
|
|
*
|
|
|
|
491
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANDREW FRASER HAMISH MURRAY (10)
|
|
|
6,005
|
|
|
|
*
|
|
|
|
6,005
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANDREW JOHN ZILLMAN & KIRSTIE ANNE
ZILLMAN (11)
|
|
|
4,500
|
|
|
|
*
|
|
|
|
4,500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANDREW KELLY & MAROL KELLY (12)
|
|
|
460
|
|
|
|
*
|
|
|
|
460
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANDREW LEONARD SMITHERS
|
|
|
1,401
|
|
|
|
*
|
|
|
|
1,401
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANDREW SCOTT WILLIS
|
|
|
168
|
|
|
|
*
|
|
|
|
168
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANDREW VINCENT SMART
|
|
|
1,412
|
|
|
|
*
|
|
|
|
1,412
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANDREW WATTS & LYNNE WATTS
|
|
|
4,105
|
|
|
|
*
|
|
|
|
4,105
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANDREW ZIVANOVIC
|
|
|
201
|
|
|
|
*
|
|
|
|
201
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANGELO MAGGIOTTO & MARIA MAGGIOTTO
& SILVIA MAGGIOTTO (13)
|
|
|
36,975
|
|
|
|
*
|
|
|
|
36,975
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANGUS SCOTT WILKIE (14)
|
|
|
9,543
|
|
|
|
*
|
|
|
|
9,543
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANNETTE PATRICIA RICHARDS
|
|
|
103
|
|
|
|
*
|
|
|
|
103
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
ANTHONY BADGER & LINDA
KACHEL (15)
|
|
|
1,265
|
|
|
|
*
|
|
|
|
1,265
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY BROWN
|
|
|
2,480
|
|
|
|
*
|
|
|
|
2,480
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY CICCARELLI & CARLA CICCARELLI
|
|
|
105
|
|
|
|
*
|
|
|
|
105
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY DEAN LAZENBY
|
|
|
567
|
|
|
|
*
|
|
|
|
567
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY JOHN DUNLOP
|
|
|
4,879
|
|
|
|
*
|
|
|
|
4,879
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY JOHN TRETHEWAY & THANAPA
TRETHEWAY (16)
|
|
|
555
|
|
|
|
*
|
|
|
|
555
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY KOOY (17)
|
|
|
586
|
|
|
|
*
|
|
|
|
586
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY KOOY & ABIGAIL KOOY (18)
|
|
|
522
|
|
|
|
*
|
|
|
|
522
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY LLOYD VAN COOTEN
|
|
|
4,675
|
|
|
|
*
|
|
|
|
4,675
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY PIZZOLATO
|
|
|
191
|
|
|
|
*
|
|
|
|
191
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ANTHONY YOUNG & DEBRA YOUNG (19)
|
|
|
1,644
|
|
|
|
*
|
|
|
|
1,644
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ARNOLD WILLIAM ROBERTSON
|
|
|
700
|
|
|
|
*
|
|
|
|
700
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ARTHUR KOULOURIS
|
|
|
478
|
|
|
|
*
|
|
|
|
478
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARBARA ALICE PIESSE (20)
|
|
|
557
|
|
|
|
*
|
|
|
|
557
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARBARA KENDRICK
|
|
|
1,071
|
|
|
|
*
|
|
|
|
1,071
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARRIE HUDSON & CHRISTINE ANNE HUDSON
(21)
|
|
|
3,592
|
|
|
|
*
|
|
|
|
3,592
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARRIE HUGHES & ELIZABETH HUGHES
|
|
|
475
|
|
|
|
*
|
|
|
|
475
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARRY BROWN & MARILYN BROWN (22)
|
|
|
3,800
|
|
|
|
*
|
|
|
|
3,800
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARRY JOHN GANT & BEVERLY LORRAINE
GANT (23)
|
|
|
4,641
|
|
|
|
*
|
|
|
|
4,641
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARRY OATES & ALEXANDRA WATTS (24)
|
|
|
1,500
|
|
|
|
*
|
|
|
|
1,500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARRY ROBERT BULLEN
|
|
|
4,402
|
|
|
|
*
|
|
|
|
4,402
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARRY EDWARD TANTON & ELIZABETH
MARY TANTON (25)
|
|
|
7,500
|
|
|
|
*
|
|
|
|
7,500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BARRY WATSON & JANET WATSON (26)
|
|
|
4,032
|
|
|
|
*
|
|
|
|
4,032
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BEC MARSHALL
|
|
|
230
|
|
|
|
*
|
|
|
|
230
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BELINDA JONES & CHARLES JONES (27)
|
|
|
2,861
|
|
|
|
*
|
|
|
|
2,861
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BEN KAY (28)
|
|
|
2,600
|
|
|
|
*
|
|
|
|
2,600
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BENEDICT CARL WILLIAM HOLLAND
|
|
|
667
|
|
|
|
*
|
|
|
|
667
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BENJAMIN ALAN YOUNG
|
|
|
104
|
|
|
|
*
|
|
|
|
104
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BENJAMIN DAVID WILKIE
|
|
|
11,958
|
|
|
|
*
|
|
|
|
11,958
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BENJAMIN JOHN SEWELL
|
|
|
200
|
|
|
|
*
|
|
|
|
200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
BENJAMIN JOHN THOMPSON
|
|
|
5,460
|
|
|
|
*
|
|
|
|
5,460
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BENJAMIN MELLERS (29)
|
|
|
169
|
|
|
|
*
|
|
|
|
169
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BONNIE J GOODRICH
|
|
|
800
|
|
|
|
*
|
|
|
|
800
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BONNIE JUNE GOODRICH & MARNEY RENEE
JEFFERIES (30)
|
|
|
3,209
|
|
|
|
*
|
|
|
|
3,209
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BREE CHRISTINA GRANT & DALE PHILIP
ALAN GRANT
|
|
|
167
|
|
|
|
*
|
|
|
|
167
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRENDAN PROWSE (31)
|
|
|
2,898
|
|
|
|
*
|
|
|
|
2,898
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRETT ANDREW HANSEN & JENNIFER LOUISE
HANSEN (32)
|
|
|
1,033
|
|
|
|
*
|
|
|
|
1,033
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRETT HANSEN (33)
|
|
|
683
|
|
|
|
*
|
|
|
|
683
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRETT DURDIN
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRIAN GARNETT & SUSAN GARNETT (34)
|
|
|
2,572
|
|
|
|
*
|
|
|
|
2,572
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRIAN MARTIN & CHERYL MARTIN (35)
|
|
|
147
|
|
|
|
*
|
|
|
|
147
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRIAN MATTHEWS (36)
|
|
|
5,326
|
|
|
|
*
|
|
|
|
5,326
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRIAN PRICE & CHRISTINE PRICE
|
|
|
1,438
|
|
|
|
*
|
|
|
|
1,438
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRONWYN EDWARDS
|
|
|
503
|
|
|
|
*
|
|
|
|
503
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRUCE HINCKFUSS (37)
|
|
|
28,136
|
|
|
|
*
|
|
|
|
28,136
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRUCE ROBERT WHITE
|
|
|
2,400
|
|
|
|
*
|
|
|
|
2,400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
BRUCE ROBERT WHITE & KATHLEEN MARJORIE
WHITE
|
|
|
1,874
|
|
|
|
*
|
|
|
|
1,874
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CAMILLA PRENDERGAST
|
|
|
407
|
|
|
|
*
|
|
|
|
407
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CARLA CHOLEWINSKI
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CARLA PIA MARIA CROOKS
|
|
|
555
|
|
|
|
*
|
|
|
|
555
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CARLENE SOUTHGATE
|
|
|
3,000
|
|
|
|
*
|
|
|
|
3,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CARLY MAREE JOYCE
|
|
|
318
|
|
|
|
*
|
|
|
|
318
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CAROLYN JO-ANNE PAYNE
|
|
|
234
|
|
|
|
*
|
|
|
|
234
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CASSANDRA ROBYN WALSH & MICHAEL
ROBERT BARRY LAW
|
|
|
874
|
|
|
|
*
|
|
|
|
874
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CHARLES ANTHONY JONES & BELINDA
MAREE JONES
|
|
|
422
|
|
|
|
*
|
|
|
|
422
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CHARLES JONES
|
|
|
548
|
|
|
|
*
|
|
|
|
548
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CHARLIE KEALL (38)
|
|
|
6,579
|
|
|
|
*
|
|
|
|
6,579
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CHESTER JAMES STOKES & DIANNE JOYCE
STOKES
|
|
|
1,800
|
|
|
|
*
|
|
|
|
1,800
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CHRIS PAYNE (39)
|
|
|
109
|
|
|
|
*
|
|
|
|
109
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CHRISTINE ANN GILMOUR
|
|
|
1,263
|
|
|
|
*
|
|
|
|
1,263
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
CHRISTINE FRANCES CAIN &
BARNEY JOSEPH CAIN
|
|
|
9,958
|
|
|
|
*
|
|
|
|
9,958
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CHRISTOPHER BREGENHOJ & JULIE BREGENHOJ
(40)
|
|
|
420
|
|
|
|
*
|
|
|
|
420
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CHRISTOPHER RALPH GILMOUR
|
|
|
1,345
|
|
|
|
*
|
|
|
|
1,345
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CINDY LOUISE HUPPATZ
|
|
|
106
|
|
|
|
*
|
|
|
|
106
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CLIFTON KEITH CRANE & GLENNIS ANN
CRANE
|
|
|
1,160
|
|
|
|
*
|
|
|
|
1,160
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CLIVE JONES (41)
|
|
|
4,000
|
|
|
|
*
|
|
|
|
4,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CLIVE MCCORKELL (42)
|
|
|
578
|
|
|
|
*
|
|
|
|
578
|
|
|
|
0
|
|
|
|
0.00
|
%
|
COLIN BURTON (43)
|
|
|
1,627
|
|
|
|
*
|
|
|
|
1,627
|
|
|
|
0
|
|
|
|
0.00
|
%
|
COLIN BURTON (44)
|
|
|
10,971
|
|
|
|
*
|
|
|
|
10,971
|
|
|
|
0
|
|
|
|
0.00
|
%
|
COLIN J DAMIANI & DIANE R DAMIANI
|
|
|
124
|
|
|
|
*
|
|
|
|
124
|
|
|
|
0
|
|
|
|
0.00
|
%
|
COLIN WILLIAM DILLON & LINDA ANN
DILLON
|
|
|
2,200
|
|
|
|
*
|
|
|
|
2,200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
COLLETTE ANNE WETTERLING
|
|
|
534
|
|
|
|
*
|
|
|
|
534
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CONRAD J MARTIN (45)
|
|
|
6,317
|
|
|
|
*
|
|
|
|
6,317
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CONSTANCE ELIZABETH LEE-ANDERSON
|
|
|
100
|
|
|
|
*
|
|
|
|
100
|
|
|
|
0
|
|
|
|
0.00
|
%
|
COSTANZO TACCONE & ANGELA TACCONE
|
|
|
1,231
|
|
|
|
*
|
|
|
|
1,231
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CRAIG WALPOLE & TRACY WALPOLE (46)
|
|
|
834
|
|
|
|
*
|
|
|
|
834
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CRISTINA MASLIN (47)
|
|
|
1,818
|
|
|
|
*
|
|
|
|
1,818
|
|
|
|
0
|
|
|
|
0.00
|
%
|
CZESLAW MICHAEL KOZICKI & ANGELE
DANUTE KOZICKI (48)
|
|
|
7,110
|
|
|
|
*
|
|
|
|
7,110
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAAK GIBSON (49)
|
|
|
238
|
|
|
|
*
|
|
|
|
238
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAMIAN FRASER
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAMIAN WILLIAM SCHAEFER
|
|
|
500
|
|
|
|
*
|
|
|
|
500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAMIEN CLARKE (50)
|
|
|
16,000
|
|
|
|
*
|
|
|
|
16,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAMIEN PUGH (51)
|
|
|
482
|
|
|
|
*
|
|
|
|
482
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAMIEN SCOTT MATHIESON
|
|
|
10,730
|
|
|
|
*
|
|
|
|
10,730
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DANIEL DALZOTTO
|
|
|
181
|
|
|
|
*
|
|
|
|
181
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DANIEL HANSEN
|
|
|
200
|
|
|
|
*
|
|
|
|
200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DANIEL JOHN HOARE (52)
|
|
|
13,236
|
|
|
|
*
|
|
|
|
13,236
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DANIEL LIVINGSTON & MARGARET LIVINGSTON
(53)
|
|
|
7,305
|
|
|
|
*
|
|
|
|
7,305
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DANIEL O’CONNELL
|
|
|
2,105
|
|
|
|
*
|
|
|
|
2,105
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DANIEL PETER CREAGH
|
|
|
7,000
|
|
|
|
*
|
|
|
|
7,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
DANIEL WILLIAM O’CONNELL
& FRANCES NEUMANN (54)
|
|
|
3,636
|
|
|
|
*
|
|
|
|
3,636
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DANNY PATRICK HEAL
|
|
|
500
|
|
|
|
*
|
|
|
|
500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DARREN HUTCHINSON (55)
|
|
|
13,014
|
|
|
|
*
|
|
|
|
13,014
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DARREN ROBERT PUTLAND (56)
|
|
|
129
|
|
|
|
*
|
|
|
|
129
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DARREN STEVEN HUTCHINSON (57)
|
|
|
1,423
|
|
|
|
*
|
|
|
|
1,423
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DARRYL MURRAY LOCK
|
|
|
1,402
|
|
|
|
*
|
|
|
|
1,402
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DARRYL MURRAY LOCK & BRONWYN KAY
LOCK (58)
|
|
|
7,980
|
|
|
|
*
|
|
|
|
7,980
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID CHARLES WARD & JULIE WARD
(59)
|
|
|
855
|
|
|
|
*
|
|
|
|
855
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID ANDREW NITSCHKE
|
|
|
211
|
|
|
|
*
|
|
|
|
211
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID BROWN (60)
|
|
|
42,000
|
|
|
|
*
|
|
|
|
42,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID BRUCE CROSSLEY
|
|
|
9,742
|
|
|
|
*
|
|
|
|
9,742
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID BRUCE VIDLER & LISA MAREE
VIDLER (61)
|
|
|
612
|
|
|
|
*
|
|
|
|
612
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID FORCHETTI (62)
|
|
|
279
|
|
|
|
*
|
|
|
|
279
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID JENKINSON (63)
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID JOHN GREGG (64)
|
|
|
12,093
|
|
|
|
*
|
|
|
|
12,093
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID MARCON & RACHELA MARCON
|
|
|
124
|
|
|
|
*
|
|
|
|
124
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID MICHAEL NEWMAN & DEBRA MARGARET
NEWMAN
|
|
|
2,342
|
|
|
|
*
|
|
|
|
2,342
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID NITSCHKE (65)
|
|
|
7,789
|
|
|
|
*
|
|
|
|
7,789
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID TALBOT CHINCHEN & GAY CLOVER
CHINCHEN (66)
|
|
|
2,500
|
|
|
|
*
|
|
|
|
2,500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID TAYLOR (67)
|
|
|
976
|
|
|
|
*
|
|
|
|
976
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DAVID WILLIAM VAN ROOYEN & TONI
VAN ROOYEN (68)
|
|
|
2,252
|
|
|
|
*
|
|
|
|
2,252
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DEAN MARCON
|
|
|
3,490
|
|
|
|
*
|
|
|
|
3,490
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DEBORAH JANE MOCK & FRANK JOSEPH
MOCK
|
|
|
7,566
|
|
|
|
*
|
|
|
|
7,566
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DEIRK O’CONNOR & JOANNE WILLIAMS
(69)
|
|
|
1,486
|
|
|
|
*
|
|
|
|
1,486
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DENIS DURAND (70)
|
|
|
515
|
|
|
|
*
|
|
|
|
515
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DENNIS TREGONNING HARRIS & KATHLEEN
LORRAINE HARRIS
|
|
|
1,268
|
|
|
|
*
|
|
|
|
1,268
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DEREK HUTCHINSON JOHNSON
|
|
|
5,920
|
|
|
|
*
|
|
|
|
5,920
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DEREK HUTCHINSON JOHNSON & DACE
JOHNSON (71)
|
|
|
7,074
|
|
|
|
*
|
|
|
|
7,074
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DEREK REGINALD WETTERLING
|
|
|
534
|
|
|
|
*
|
|
|
|
534
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DESMOND CHARLES BUSHELL
|
|
|
2,061
|
|
|
|
*
|
|
|
|
2,061
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
DIANNA ZIVANOVIC
|
|
|
408
|
|
|
|
*
|
|
|
|
408
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DICK JOHNSON (72)
|
|
|
1,525
|
|
|
|
*
|
|
|
|
1,525
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DIMITRA THANOPOULOS
|
|
|
118
|
|
|
|
*
|
|
|
|
118
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DOMENIC TACCA (73)
|
|
|
12,695
|
|
|
|
*
|
|
|
|
12,695
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DOMINIC CHIARAVALLE & EVA CHIARAVALLE
(74)
|
|
|
1,140
|
|
|
|
*
|
|
|
|
1,140
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DOMINIC JOHN CURCIO
|
|
|
357
|
|
|
|
*
|
|
|
|
357
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DONALD ALAN SAYERS
|
|
|
331
|
|
|
|
*
|
|
|
|
331
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DONALD ALAN SAYERS & MARILYN ANN
SAYERS (75)
|
|
|
1,775
|
|
|
|
*
|
|
|
|
1,775
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DONALD ARTHUR PETERSON & WENDY ANNE
PETERSON (76)
|
|
|
393
|
|
|
|
*
|
|
|
|
393
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DONALD HENRY SWAIN & JOCELYN JEAN
SWAIN (77)
|
|
|
763
|
|
|
|
*
|
|
|
|
763
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DOROTHY JEAN ELLIS
|
|
|
648
|
|
|
|
*
|
|
|
|
648
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DOUGLAS ALLAN KILGOUR (78)
|
|
|
135
|
|
|
|
*
|
|
|
|
135
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DOUGLAS NICHOLSON (79)
|
|
|
1,250
|
|
|
|
*
|
|
|
|
1,250
|
|
|
|
0
|
|
|
|
0.00
|
%
|
DOUGLAS R. DILLON AND STEPHEN R. WHAREKAWA
|
|
|
1,758
|
|
|
|
*
|
|
|
|
1,758
|
|
|
|
0
|
|
|
|
0.00
|
%
|
EDGAR HAWTER (80)
|
|
|
5,000
|
|
|
|
*
|
|
|
|
5,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
EDWARD HABERFIELD (81)
|
|
|
5,000
|
|
|
|
*
|
|
|
|
5,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
EDWARD MORGAN & LINDA MORGAN (82)
|
|
|
6,000
|
|
|
|
*
|
|
|
|
6,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ELIZABETH ANN HARDCASTLE
|
|
|
771
|
|
|
|
*
|
|
|
|
771
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ELMS LAZURKO (83)
|
|
|
240
|
|
|
|
*
|
|
|
|
240
|
|
|
|
0
|
|
|
|
0.00
|
%
|
EMILIOUS GEORGIOU (84)
|
|
|
1,010
|
|
|
|
*
|
|
|
|
1,010
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ERIC CHARLES DYER
|
|
|
5,024
|
|
|
|
*
|
|
|
|
5,024
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ERIC CHARLES DYER & OLENA DYER &
ALWYN REGINALD DYER & KERRYN JEAN DYER (85)
|
|
|
5,496
|
|
|
|
*
|
|
|
|
5,496
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ERIC JAMES FREW & HEATHER JOY FREW
& LISA ROBYN TURNER
|
|
|
415
|
|
|
|
*
|
|
|
|
415
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ERIC JAMES FREW & HEATHER JOY FREW
|
|
|
1,411
|
|
|
|
*
|
|
|
|
1,411
|
|
|
|
0
|
|
|
|
0.00
|
%
|
EUGENE KATSOS
|
|
|
3,089
|
|
|
|
*
|
|
|
|
3,089
|
|
|
|
0
|
|
|
|
0.00
|
%
|
EVELYN GRIEVE
|
|
|
401
|
|
|
|
*
|
|
|
|
401
|
|
|
|
0
|
|
|
|
0.00
|
%
|
EVERT POL (86)
|
|
|
5,900
|
|
|
|
*
|
|
|
|
5,900
|
|
|
|
0
|
|
|
|
0.00
|
%
|
EVETTE ANNE STEELE
|
|
|
300
|
|
|
|
*
|
|
|
|
300
|
|
|
|
0
|
|
|
|
0.00
|
%
|
FIONA DOBRZYNSKI
|
|
|
211
|
|
|
|
*
|
|
|
|
211
|
|
|
|
0
|
|
|
|
0.00
|
%
|
FIONA PROWSE
|
|
|
2,849
|
|
|
|
*
|
|
|
|
2,849
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
FRANCESCO TACCA (87)
|
|
|
5,877
|
|
|
|
*
|
|
|
|
5,877
|
|
|
|
0
|
|
|
|
0.00
|
%
|
FRANCIS WRIGHT WILKIE (88)
|
|
|
24,559
|
|
|
|
*
|
|
|
|
24,559
|
|
|
|
0
|
|
|
|
0.00
|
%
|
FRANK CHRISTOPHER LAWRENCE
|
|
|
6,666
|
|
|
|
*
|
|
|
|
6,666
|
|
|
|
0
|
|
|
|
0.00
|
%
|
FRANK JORDON
|
|
|
605
|
|
|
|
*
|
|
|
|
605
|
|
|
|
0
|
|
|
|
0.00
|
%
|
FREDERICK JAMES PARK & THELMA LORNA
PARK
|
|
|
108
|
|
|
|
*
|
|
|
|
108
|
|
|
|
0
|
|
|
|
0.00
|
%
|
FRANK MAMMERELLA (89)
|
|
|
1,498
|
|
|
|
*
|
|
|
|
1,498
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GANESH RADHAKRISHNAN (90)
|
|
|
4,139
|
|
|
|
*
|
|
|
|
4,139
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GARRY JOHN MCKENZIE & JULIE MAY
MCKENZIE (91)
|
|
|
1,053
|
|
|
|
*
|
|
|
|
1,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GARY BIRRELL
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GARY DAVID DOUGLAS
|
|
|
2,033
|
|
|
|
*
|
|
|
|
2,033
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GARY KENDRICK
|
|
|
2,190
|
|
|
|
*
|
|
|
|
2,190
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GARY MCKENZIE (92)
|
|
|
2,100
|
|
|
|
*
|
|
|
|
2,100
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GAVIN DENTON (93)
|
|
|
4,089
|
|
|
|
*
|
|
|
|
4,089
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFF WHITTOME & LEONIE WHITTOME
(94)
|
|
|
1,333
|
|
|
|
*
|
|
|
|
1,333
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY FRANCIS FONTAINE
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY FRANCIS FONTAINE (95)
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY LEWIS GODLEY & CAROLYN
JOAN GODLEY (96)
|
|
|
17,743
|
|
|
|
*
|
|
|
|
17,743
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY LEWIS GODLEY & SEAN OTTO
MANTA RASMUSSEN (97)
|
|
|
1,002
|
|
|
|
*
|
|
|
|
1,002
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY MALCOLM TAYLOR (98)
|
|
|
2,699
|
|
|
|
*
|
|
|
|
2,699
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY MALCOLM TAYLOR & SUZANNE
JENNIFER TAYLOR & MILTON DOUGLAS TAYLOR (99)
|
|
|
287
|
|
|
|
*
|
|
|
|
287
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY ROBERT MILLS
|
|
|
500
|
|
|
|
*
|
|
|
|
500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY RONALD SULLIVAN & PAMELA
MARGARET SULLIVAN (100)
|
|
|
4,125
|
|
|
|
*
|
|
|
|
4,125
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY WALLIS ARUNDELL (101)
|
|
|
1,903
|
|
|
|
*
|
|
|
|
1,903
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEOFFREY WERRETT FRENCH & JACQUELINE
GIBSON (102)
|
|
|
1,421
|
|
|
|
*
|
|
|
|
1,421
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEORGE EDGAR BLAIR-WEST & MARJORIE
RAY BLAIR-WEST (103)
|
|
|
1,433
|
|
|
|
*
|
|
|
|
1,433
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEORGE LESLIE BLISS (104)
|
|
|
12,744
|
|
|
|
*
|
|
|
|
12,744
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEORGE VLAHOS & COLLEEN VLAHOS (105)
|
|
|
273
|
|
|
|
*
|
|
|
|
273
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEORGE WILLIAM BLAIR-WEST (106)
|
|
|
4,016
|
|
|
|
*
|
|
|
|
4,016
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GEORGE WILLIAM BLAIR-WEST & PENELOPE
NERIDA BLAIR-WEST (107)
|
|
|
1,745
|
|
|
|
*
|
|
|
|
1,745
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GERHARDUS NEL & HILARY NEL (108)
|
|
|
1,138
|
|
|
|
*
|
|
|
|
1,138
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
GERRIT HORCHNER
|
|
|
327
|
|
|
|
*
|
|
|
|
327
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GIANNI MASON
|
|
|
491
|
|
|
|
*
|
|
|
|
491
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GIANNI MASON & MARISSA MASON (109)
|
|
|
12,203
|
|
|
|
*
|
|
|
|
12,203
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GIUSEPPE GIUSTI & MARIA GIUSTI (110)
|
|
|
120
|
|
|
|
*
|
|
|
|
120
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GLENN GEORGE BAILEY
|
|
|
1,998
|
|
|
|
*
|
|
|
|
1,998
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GLENN RAYMOND JOYCE & JUDITH THERESE
JOYCE (111)
|
|
|
2,060
|
|
|
|
*
|
|
|
|
2,060
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GLENN ROBERT PRENDERGAST & JOANNA
LUETCHFORD PRENDERGAST
|
|
|
400
|
|
|
|
*
|
|
|
|
400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GORDON HERIOT (112)
|
|
|
10,044
|
|
|
|
*
|
|
|
|
10,044
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GORDON JOSEPH MASLIN & CHRISTINA
MASLIN (113)
|
|
|
5,938
|
|
|
|
*
|
|
|
|
5,938
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GRAEME LEIGH SMITH (114)
|
|
|
667
|
|
|
|
*
|
|
|
|
667
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GRAHAM WARDEN & MARION WARDEN (115)
|
|
|
409
|
|
|
|
*
|
|
|
|
409
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GRAHAM WORN & GLORIA HARTNEY (116)
|
|
|
2,611
|
|
|
|
*
|
|
|
|
2,611
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GRANT DENNIS (117)
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GRANT JOSEPH TENNI (118)
|
|
|
2,501
|
|
|
|
*
|
|
|
|
2,501
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GREGORY HULBERT
|
|
|
767
|
|
|
|
*
|
|
|
|
767
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GREG WATSON (119)
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
GREGORY VINCENT HARVEY
|
|
|
435
|
|
|
|
*
|
|
|
|
435
|
|
|
|
0
|
|
|
|
0.00
|
%
|
HAROLD A. HANSEN (120)
|
|
|
12,015
|
|
|
|
*
|
|
|
|
12,015
|
|
|
|
0
|
|
|
|
0.00
|
%
|
HARRY HATCH
|
|
|
60,000
|
|
|
|
*
|
|
|
|
60,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
HAYDEN TRIM & KRISTEN TRIM (121)
|
|
|
2,248
|
|
|
|
*
|
|
|
|
2,248
|
|
|
|
0
|
|
|
|
0.00
|
%
|
HEATH JANSEN
|
|
|
45,832
|
|
|
|
*
|
|
|
|
45,832
|
|
|
|
0
|
|
|
|
0.00
|
%
|
HEATHER JOY FREW & LISA ROBYN TURNER
|
|
|
400
|
|
|
|
*
|
|
|
|
400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
HOWARD ROSS & MARTHA ROSS (122)
|
|
|
747
|
|
|
|
*
|
|
|
|
747
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN CROOKS & KARIN CROOKS (123)
|
|
|
5,839
|
|
|
|
*
|
|
|
|
5,839
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN FOSTER & DENISE FOSTER (124)
|
|
|
1,887
|
|
|
|
*
|
|
|
|
1,887
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN GRAEME PATTERSON (125)
|
|
|
4,282
|
|
|
|
*
|
|
|
|
4,282
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN HAROLD BANKS & SANDRA ELIZABETH
BANKS (126)
|
|
|
5,135
|
|
|
|
*
|
|
|
|
5,135
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN LEACH
|
|
|
1,500
|
|
|
|
*
|
|
|
|
1,500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN MATHIESON
|
|
|
18,897
|
|
|
|
*
|
|
|
|
18,897
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN MATHIESON & ANNA MATHIESON
|
|
|
1,104
|
|
|
|
*
|
|
|
|
1,104
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
IAN MCKAY GILMOUR &
CHRISTINE ANN GILMOUR (127)
|
|
|
11,000
|
|
|
|
*
|
|
|
|
11,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN MURRAY HARDCASTLE & ELIZABETH
ANN HARDCASTLE (128)
|
|
|
1,096
|
|
|
|
*
|
|
|
|
1,096
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN PATTERSON & NATALIE PATTERSON
(129)
|
|
|
1,500
|
|
|
|
*
|
|
|
|
1,500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN STEWART VAN DER WERFF
|
|
|
3,000
|
|
|
|
*
|
|
|
|
3,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN STEWART VAN DER WERFF (130)
|
|
|
3,098
|
|
|
|
*
|
|
|
|
3,098
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN STEWART VAN DER WERFF & LINDA
ELIZABETH LAYTON VAN DER WERF (131)
|
|
|
3,808
|
|
|
|
*
|
|
|
|
3,808
|
|
|
|
0
|
|
|
|
0.00
|
%
|
IAN SYNMAN (132)
|
|
|
150
|
|
|
|
*
|
|
|
|
150
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JACKSON BLAIR-WEST
|
|
|
200
|
|
|
|
*
|
|
|
|
200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JACQUELINE MARY VALLENCE
|
|
|
260
|
|
|
|
*
|
|
|
|
260
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JAKE EMMERSON
|
|
|
405
|
|
|
|
*
|
|
|
|
405
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JAMES ALEXANDER GRANT (133)
|
|
|
201
|
|
|
|
*
|
|
|
|
201
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JAMES GERALD DIGBY
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JAMES LAWRENSON & ROSEMARIE LAWRENSON
(134)
|
|
|
13,398
|
|
|
|
*
|
|
|
|
13,398
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JAMES MATTHEW CREAGH & CHRISTINE
MARY CREAGH (135)
|
|
|
6,127
|
|
|
|
*
|
|
|
|
6,127
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JAMES OAKES
|
|
|
200
|
|
|
|
*
|
|
|
|
200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JAN FREDRIKSSON
|
|
|
1,440
|
|
|
|
*
|
|
|
|
1,440
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JAN GREENE & CARDYN WADDINGTON &
MEREDITH HOGENKEMP (136)
|
|
|
124
|
|
|
|
*
|
|
|
|
124
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JAN LOUISE GREENE
|
|
|
124
|
|
|
|
*
|
|
|
|
124
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JANE MARGOT MARTIN
|
|
|
7,420
|
|
|
|
*
|
|
|
|
7,420
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JANETTE ELIZABETH MOORE
|
|
|
2,037
|
|
|
|
*
|
|
|
|
2,037
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JANICE MARY MYERSCOUGH
|
|
|
498
|
|
|
|
*
|
|
|
|
498
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JASON PFITZNER (137)
|
|
|
2,700
|
|
|
|
*
|
|
|
|
2,700
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JASON PFITZNER (138)
|
|
|
6,605
|
|
|
|
*
|
|
|
|
6,605
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JASON RYAN
|
|
|
3,500
|
|
|
|
*
|
|
|
|
3,500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JEFFREY MAXWELL STANDER
|
|
|
1,750
|
|
|
|
*
|
|
|
|
1,750
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JENNIFER MAREE BALL
|
|
|
3,300
|
|
|
|
*
|
|
|
|
3,300
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JENNY PAPADIMITROU & JAMES PAPADIMITROU
(139)
|
|
|
2,053
|
|
|
|
*
|
|
|
|
2,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JESSE HUDSON GIVENS-LAMB
|
|
|
700
|
|
|
|
*
|
|
|
|
700
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JESSICA INGRID WILKIE
|
|
|
9,000
|
|
|
|
*
|
|
|
|
9,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JESSIE ANESHKA SEWELL
|
|
|
200
|
|
|
|
*
|
|
|
|
200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
JILL DIANA LOVETT &
CRAIG DAVID LOVETT & EWAN JAMES LOVETT (140)
|
|
|
8,399
|
|
|
|
*
|
|
|
|
8,399
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JILL MURPHY
|
|
|
278
|
|
|
|
*
|
|
|
|
278
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JIM COMINO & KAY MAREE COMINO
|
|
|
2,095
|
|
|
|
*
|
|
|
|
2,095
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOANNA HOWE
|
|
|
1,037
|
|
|
|
*
|
|
|
|
1,037
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOANNA HOWE & HAILEY HOWE &
RIANNA PAGANO
|
|
|
1,030
|
|
|
|
*
|
|
|
|
1,030
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOANNE NICOLE HANSEN (141)
|
|
|
695
|
|
|
|
*
|
|
|
|
695
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOE ARDITA & TINA ARDITA
|
|
|
600
|
|
|
|
*
|
|
|
|
600
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN CAMPBELL (142)
|
|
|
1,985
|
|
|
|
*
|
|
|
|
1,985
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN EDWARD HARTNEY & ALDONA OLGA
HARTNEY
|
|
|
403
|
|
|
|
*
|
|
|
|
403
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN FEDERICO
|
|
|
404
|
|
|
|
*
|
|
|
|
404
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN FIELD & ANNE FIELD (143)
|
|
|
3,505
|
|
|
|
*
|
|
|
|
3,505
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN FLYNN & MICHELLE CURRAN
|
|
|
403
|
|
|
|
*
|
|
|
|
403
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN FRANCIS HANSEN
|
|
|
500
|
|
|
|
*
|
|
|
|
500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN GEOFFREY ADNAMS & ELIZABETH
ANN ADNAMS (144)
|
|
|
1,374
|
|
|
|
*
|
|
|
|
1,374
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN MACRI
|
|
|
266
|
|
|
|
*
|
|
|
|
266
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN MACRI & MARIA MACRI
|
|
|
1,558
|
|
|
|
*
|
|
|
|
1,558
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN MICHAEL HEARMAN
|
|
|
156
|
|
|
|
*
|
|
|
|
156
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN ROBINSON
|
|
|
1,475
|
|
|
|
*
|
|
|
|
1,475
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN ROLF ERIC HANSEN
|
|
|
300
|
|
|
|
*
|
|
|
|
300
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN ROLF HANSEN & REBECCA MARGOT
HANSEN (145)
|
|
|
5,300
|
|
|
|
*
|
|
|
|
5,300
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN ROYALL (146)
|
|
|
900
|
|
|
|
*
|
|
|
|
900
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN STEPHEN FRY & LYNETTE ROBYN
FRY (147)
|
|
|
1,079
|
|
|
|
*
|
|
|
|
1,079
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN TALONE
|
|
|
1,053
|
|
|
|
*
|
|
|
|
1,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN THWAITES (148)
|
|
|
1,474
|
|
|
|
*
|
|
|
|
1,474
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN TURNBULL & SOMPHONG TURNBULL
(149)
|
|
|
3,950
|
|
|
|
*
|
|
|
|
3,950
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOHN PANKHURST
|
|
|
245
|
|
|
|
*
|
|
|
|
245
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOSEPH O’CONNOR
|
|
|
792
|
|
|
|
*
|
|
|
|
792
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JOY HONEY CHEN
|
|
|
8,000
|
|
|
|
*
|
|
|
|
8,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JUDITH WILLOUGHBY & WAYNE WILLOUGHBY
(150)
|
|
|
24,109
|
|
|
|
*
|
|
|
|
24,109
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JUDY ELIZABETH GREEN
|
|
|
122
|
|
|
|
*
|
|
|
|
122
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
JULIA DIANA LOVETT &
CRAIG DAVID LOVETT & EWAN JAMES LOVETT & MAREE SHARON LOVETT (151)
|
|
|
5,636
|
|
|
|
*
|
|
|
|
5,636
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JULIAN KIRZNER (152)
|
|
|
2,523
|
|
|
|
*
|
|
|
|
2,523
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JULIE ANN BURNS
|
|
|
129
|
|
|
|
*
|
|
|
|
129
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JULIE DIANE THOMAS
|
|
|
402
|
|
|
|
*
|
|
|
|
402
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JULIE GOWAN (153)
|
|
|
150
|
|
|
|
*
|
|
|
|
150
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JUSTIN BLUMFIELD
|
|
|
311
|
|
|
|
*
|
|
|
|
311
|
|
|
|
0
|
|
|
|
0.00
|
%
|
JUSTIN NUICH
|
|
|
803
|
|
|
|
*
|
|
|
|
803
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KARA LIVINGSTON
|
|
|
397
|
|
|
|
*
|
|
|
|
397
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KARIN HUNTER
|
|
|
1,111
|
|
|
|
*
|
|
|
|
1,111
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KATHRYN JEAN GAMBELL
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KATHY BEATRIX PERKINS
|
|
|
750
|
|
|
|
*
|
|
|
|
750
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KEITH ARNOLD VUICHOUD
|
|
|
400
|
|
|
|
*
|
|
|
|
400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KEITH ARNOLD VUICHOUD & JOANNE VUICHOUD
(154)
|
|
|
3,368
|
|
|
|
*
|
|
|
|
3,368
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KELVIN MCBRIDE (155)
|
|
|
527
|
|
|
|
*
|
|
|
|
527
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KEN MURRAY (156)
|
|
|
7,000
|
|
|
|
*
|
|
|
|
7,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KEN RYAN & KAY RYAN
|
|
|
215
|
|
|
|
*
|
|
|
|
215
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KEN STUCKEY (157)
|
|
|
24,792
|
|
|
|
*
|
|
|
|
24,792
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KENNETH ALAN LABONE
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KENNETH JOHN ULLMAN & VICTORIA JANE
ULLMAN (158)
|
|
|
7,053
|
|
|
|
*
|
|
|
|
7,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KERRIE ANNE BALL & PETER GEOFFREY
BALL (159)
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KERRIE LOUISE GRAYSON (160)
|
|
|
3,010
|
|
|
|
*
|
|
|
|
3,010
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KERRY LYNETTE GREENOP
|
|
|
425
|
|
|
|
*
|
|
|
|
425
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KEVIN FRANCIS WOOD
|
|
|
401
|
|
|
|
*
|
|
|
|
401
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KEVIN JOHN HOWARD (161)
|
|
|
13,618
|
|
|
|
*
|
|
|
|
13,618
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KEVIN RILEY (162)
|
|
|
836
|
|
|
|
*
|
|
|
|
836
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KEVIN VARDY & ELIZABETH VARDY (163)
|
|
|
1,098
|
|
|
|
*
|
|
|
|
1,098
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KIM MARTIN
|
|
|
2,106
|
|
|
|
*
|
|
|
|
2,106
|
|
|
|
0
|
|
|
|
0.00
|
%
|
KYLIE KOUVELAS
|
|
|
866
|
|
|
|
*
|
|
|
|
866
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LACHLAN AARON BELL
|
|
|
764
|
|
|
|
*
|
|
|
|
764
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LAINIE MAREE ADDINELL
|
|
|
1,130
|
|
|
|
*
|
|
|
|
1,130
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
LAKSHMAN PRASAD (164)
|
|
|
84,645
|
|
|
|
*
|
|
|
|
84,645
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LANCE POLLARD (165)
|
|
|
2,295
|
|
|
|
*
|
|
|
|
2,295
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LARRY SWIFT
|
|
|
605
|
|
|
|
*
|
|
|
|
605
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LAURANCE ANTHONY SIDARI
|
|
|
612
|
|
|
|
*
|
|
|
|
612
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LAWRIE KIRBY & HEATHER KIRBY (166)
|
|
|
8,000
|
|
|
|
*
|
|
|
|
8,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LEEANNE KATHLEEN ALCORN
|
|
|
486
|
|
|
|
*
|
|
|
|
486
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LEIGH STAFFORD (167)
|
|
|
1,560
|
|
|
|
*
|
|
|
|
1,560
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LENNOX MACLEAN & MILTON FRITH &
RICHARD PATRICK BUNGEY
|
|
|
403
|
|
|
|
*
|
|
|
|
403
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LEONE SIGNA CATHERINE BALDOCK
|
|
|
160
|
|
|
|
*
|
|
|
|
160
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LESLEIGH DENISE WAGNER
|
|
|
2,501
|
|
|
|
*
|
|
|
|
2,501
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LESLEY MARGARET FROST & JOHN ARNOLD
FROST (168)
|
|
|
3,593
|
|
|
|
*
|
|
|
|
3,593
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LESLEY SMITHERS & CAROLYN WILLIAMS
|
|
|
3,196
|
|
|
|
*
|
|
|
|
3,196
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LINDA MAREE GANT (169)
|
|
|
1,733
|
|
|
|
*
|
|
|
|
1,733
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LISA MAREE VIDLER
|
|
|
2,963
|
|
|
|
*
|
|
|
|
2,963
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LIVIANA FORZA
|
|
|
206
|
|
|
|
*
|
|
|
|
206
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LOIS CLOSTER (170)
|
|
|
627
|
|
|
|
*
|
|
|
|
627
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LOUISE CHRISTINE GILMOUR
|
|
|
1,290
|
|
|
|
*
|
|
|
|
1,290
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LUKE SIKALIAS & CHRISTINA SIKALIAS
|
|
|
4,053
|
|
|
|
*
|
|
|
|
4,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LUKE SILK
|
|
|
4,000
|
|
|
|
*
|
|
|
|
4,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LYNDA MAREE HILLS & CHRISTOPHER
ROY COLLEY & CHRISTINE ANNE HILLS (171)
|
|
|
1,100
|
|
|
|
*
|
|
|
|
1,100
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LYNETTE BERYLE BARNES & DARCY THOMAS
BARNES & FLETCHER LLOYD BARNES & RILEY ARNOTT BARNES (172)
|
|
|
1,053
|
|
|
|
*
|
|
|
|
1,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LYNETTE MARGARET SCHAEFER
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
LYNETTE MARIA GOYEN
|
|
|
530
|
|
|
|
*
|
|
|
|
530
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MALCOLM ANDREW WARREN & NOLA JOY
WARREN (173)
|
|
|
1,325
|
|
|
|
*
|
|
|
|
1,325
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARCEL KOCH & URSULA KOCH (174)
|
|
|
10,049
|
|
|
|
*
|
|
|
|
10,049
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MAREE LOVETT
|
|
|
4,004
|
|
|
|
*
|
|
|
|
4,004
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MAREETA V ROLLEY
|
|
|
150
|
|
|
|
*
|
|
|
|
150
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARGARET LIVINGSTON (175)
|
|
|
1,378
|
|
|
|
*
|
|
|
|
1,378
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARGARET MARY CAMENS
|
|
|
541
|
|
|
|
*
|
|
|
|
541
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARGARET MARY MCINTYRE & DAVID FRANCIS
MCINTYRE (176)
|
|
|
2,014
|
|
|
|
*
|
|
|
|
2,014
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
MARIA MITROPOULOS
|
|
|
1,427
|
|
|
|
*
|
|
|
|
1,427
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARILYN EUNICE SMITH & BRONWYN KAY
LOCK (177)
|
|
|
2,419
|
|
|
|
*
|
|
|
|
2,419
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARINA OLIVIA GRANT
|
|
|
201
|
|
|
|
*
|
|
|
|
201
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARIO POLETTI & GLENYS POLETTI
|
|
|
1,110
|
|
|
|
*
|
|
|
|
1,110
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARK FULTON TROTT & ALICEA LOUISE
TROTT (178)
|
|
|
5,000
|
|
|
|
*
|
|
|
|
5,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARK JOHN WHITTAKER & PAMELA JAYNE
WHITTAKER (179)
|
|
|
477
|
|
|
|
*
|
|
|
|
477
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARY MILES (180)
|
|
|
109
|
|
|
|
*
|
|
|
|
109
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MARY-JANE MOLONEY
|
|
|
298
|
|
|
|
*
|
|
|
|
298
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MATT CORKIN (181)
|
|
|
1,525
|
|
|
|
*
|
|
|
|
1,525
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MAURICE DI MUZIO & MARIA GRACE DI
MUZIO (182)
|
|
|
2,055
|
|
|
|
*
|
|
|
|
2,055
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MAURICE DOVER (183)
|
|
|
3,406
|
|
|
|
*
|
|
|
|
3,406
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MAX TWIGG (184)
|
|
|
1,472
|
|
|
|
*
|
|
|
|
1,472
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MAXWELL ROBERT HOOPER & VICKIE JEAN
HOOPER (185)
|
|
|
7,933
|
|
|
|
*
|
|
|
|
7,933
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MAY CHEUNG CHEE
|
|
|
2,818
|
|
|
|
*
|
|
|
|
2,818
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MELINDA HARRISON
|
|
|
486
|
|
|
|
*
|
|
|
|
486
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MELISSA SCHUTTE
|
|
|
100
|
|
|
|
*
|
|
|
|
100
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MERRYL ANDREE SHAND
|
|
|
1,074
|
|
|
|
*
|
|
|
|
1,074
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL BIGG & MONICA BIGG (186)
|
|
|
18,336
|
|
|
|
*
|
|
|
|
18,336
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL DALZOTTO
|
|
|
602
|
|
|
|
*
|
|
|
|
602
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL E ALLEN & LYNETTE CAROL
ALLEN (187)
|
|
|
3,035
|
|
|
|
*
|
|
|
|
3,035
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL GEORGE ALCORN
|
|
|
1,450
|
|
|
|
*
|
|
|
|
1,450
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL GERARD KEATING & JUDITH
ANNE KEATING (188)
|
|
|
3,543
|
|
|
|
*
|
|
|
|
3,543
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL HERBERT ROGERS (189)
|
|
|
13,755
|
|
|
|
*
|
|
|
|
13,755
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL HERBERT ROGERS & PENELOPE
JANE ROGERS (190)
|
|
|
56,602
|
|
|
|
*
|
|
|
|
56,602
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL JOHN BROWNE & TRACEY LEE
BOWNE
|
|
|
132
|
|
|
|
*
|
|
|
|
132
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL JOHN BOWNE
|
|
|
596
|
|
|
|
*
|
|
|
|
596
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL JOHN DRAPAC (191)
|
|
|
3,636
|
|
|
|
*
|
|
|
|
3,636
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL JOSEPH MCCANN (192)
|
|
|
2,512
|
|
|
|
*
|
|
|
|
2,512
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL MCMAHON (193)
|
|
|
5,170
|
|
|
|
*
|
|
|
|
5,170
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL MINICHIELLO & THERESA MINICHIELLO
(194)
|
|
|
3,114
|
|
|
|
*
|
|
|
|
3,114
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
MICHAEL QUAGLIATA
|
|
|
2,619
|
|
|
|
*
|
|
|
|
2,619
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL SERGI & ANTONETTE SERGI
|
|
|
1,361
|
|
|
|
*
|
|
|
|
1,361
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHAEL TACCONE
|
|
|
1,775
|
|
|
|
*
|
|
|
|
1,775
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MICHELLE AUDREY THOMPSON
|
|
|
213
|
|
|
|
*
|
|
|
|
213
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MILTON DOUGLAS TAYLOR
|
|
|
1,400
|
|
|
|
*
|
|
|
|
1,400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MIRIAM NERVO
|
|
|
2,415
|
|
|
|
*
|
|
|
|
2,415
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MONISH MODY (195)
|
|
|
1,053
|
|
|
|
*
|
|
|
|
1,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MUJI RETNA MUNAWATI
|
|
|
1,408
|
|
|
|
*
|
|
|
|
1,408
|
|
|
|
0
|
|
|
|
0.00
|
%
|
MURRAY OAKES AND SARAH FRANCES OAKES
|
|
|
5,000
|
|
|
|
*
|
|
|
|
5,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NATALIE PATTERSON
|
|
|
1,200
|
|
|
|
*
|
|
|
|
1,200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NATASHA JAN BULLOCK
|
|
|
100
|
|
|
|
*
|
|
|
|
100
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NEIL ALLSOPP & RHONDA ALLSOPP (196)
|
|
|
1,203
|
|
|
|
*
|
|
|
|
1,203
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NEIL ANTHONY COOPER (197)
|
|
|
1,053
|
|
|
|
*
|
|
|
|
1,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NEIL IBBOTT (198)
|
|
|
6,151
|
|
|
|
*
|
|
|
|
6,151
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NEIL JOHN BALL & LYNDI ELIZABETH
BALL (199)
|
|
|
2,523
|
|
|
|
*
|
|
|
|
2,523
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NEVILLE DAVID GRANT (200)
|
|
|
3,993
|
|
|
|
*
|
|
|
|
3,993
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NICHOLA JAMES-WALLACE
|
|
|
985
|
|
|
|
*
|
|
|
|
985
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NICHOLAS FLASKAS (201)
|
|
|
3,400
|
|
|
|
*
|
|
|
|
3,400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NICHOLAS MACRI & CARMEL MACRI
|
|
|
1,690
|
|
|
|
*
|
|
|
|
1,690
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NICHOLAS MOLONEY & LISA MOLONEY
|
|
|
2,015
|
|
|
|
*
|
|
|
|
2,015
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NICK USSIA (202)
|
|
|
444
|
|
|
|
*
|
|
|
|
444
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NICK USSIA (203)
|
|
|
383
|
|
|
|
*
|
|
|
|
383
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NICO SCHUTTE
|
|
|
3,279
|
|
|
|
*
|
|
|
|
3,279
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NICO SCHUTTE (204)
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NIGEL ANTHONY COOPER
|
|
|
237
|
|
|
|
*
|
|
|
|
237
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NOEL ARTHUR YOUNG & ESTELLE MERLE
YOUNG
|
|
|
500
|
|
|
|
*
|
|
|
|
500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
NORMA FAY ROSENHAIN (205)
|
|
|
1,377
|
|
|
|
*
|
|
|
|
1,377
|
|
|
|
0
|
|
|
|
0.00
|
%
|
OWEN J STEINHARDT & LYNITA A STEINHARDT
|
|
|
3,005
|
|
|
|
*
|
|
|
|
3,005
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PATRICK ERWIN BERNAU & DONNA MARIE
DOREY (206)
|
|
|
7,039
|
|
|
|
*
|
|
|
|
7,039
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PATRICK FRANCIS MCINTOSH & JENNIFER
DOROTHY RIMMEL (207)
|
|
|
4,900
|
|
|
|
*
|
|
|
|
4,900
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
PATRICK LOQUANCIO
|
|
|
401
|
|
|
|
*
|
|
|
|
401
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL BARRY EDWARDS & BARBARA EVELYN
EDWARDS (208)
|
|
|
6,340
|
|
|
|
*
|
|
|
|
6,340
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL CONNOLLY & DEBORAH CONNOLLY
|
|
|
252
|
|
|
|
*
|
|
|
|
252
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL CROCITTI & ROSA CROCITTI
|
|
|
2,779
|
|
|
|
*
|
|
|
|
2,779
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL HENRY THOMPSON
|
|
|
156
|
|
|
|
*
|
|
|
|
156
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL JONES (209)
|
|
|
10,000
|
|
|
|
*
|
|
|
|
10,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL RICHARD HILLS & KAREN MAREE
HILLS & DAMIAN PAUL HILLS (210)
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL RUSSELL & CHRISTOPHER RUYS
& IAN PATTERSON (211)
|
|
|
2,805
|
|
|
|
*
|
|
|
|
2,805
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL TAYLOR (212)
|
|
|
1,556
|
|
|
|
*
|
|
|
|
1,556
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL TOSIN & DANIELA TOSIN (213)
|
|
|
198
|
|
|
|
*
|
|
|
|
198
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PAUL WILLIAM BARNSBY & SONIA MARIE
BARNSBY
|
|
|
2,053
|
|
|
|
*
|
|
|
|
2,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PEPITA ROBERTS
|
|
|
3,053
|
|
|
|
*
|
|
|
|
3,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER ALBERT DOUGLAS GRIEVE & EVELYN
JOY GRIEVE
|
|
|
403
|
|
|
|
*
|
|
|
|
403
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER COLIN KEITH & SALLY LOUISE
KEITH
|
|
|
5,618
|
|
|
|
*
|
|
|
|
5,618
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER HEARMAN & PENELOPE HEARMAN
(214)
|
|
|
3,326
|
|
|
|
*
|
|
|
|
3,326
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER COLIN KEITH (215)
|
|
|
2,001
|
|
|
|
*
|
|
|
|
2,001
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER GOWAN & JULIE GOWAN (216)
|
|
|
2,068
|
|
|
|
*
|
|
|
|
2,068
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER JAMES DUNN (217)
|
|
|
2,116
|
|
|
|
*
|
|
|
|
2,116
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER HOULIHAN (218)
|
|
|
4,166
|
|
|
|
*
|
|
|
|
4,166
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER NONNENMACHER & LYNETTE NONNENMACHER
& GREGORY NONNENMACHER (219)
|
|
|
2,602
|
|
|
|
*
|
|
|
|
2,602
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER LEWIS (220)
|
|
|
7,873
|
|
|
|
*
|
|
|
|
7,873
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER MACBEAN STEWART & ROBIN KATHLEEN
STEWART
|
|
|
192
|
|
|
|
*
|
|
|
|
192
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER MARK & DORA MARK (221)
|
|
|
230
|
|
|
|
*
|
|
|
|
230
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER MELVILLE KING & ELIZABETH
MARY KING
|
|
|
5,500
|
|
|
|
*
|
|
|
|
5,500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER MOORE (222)
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER ROBERT MOORE
|
|
|
4,000
|
|
|
|
*
|
|
|
|
4,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER RYAN GILMOUR
|
|
|
1,405
|
|
|
|
*
|
|
|
|
1,405
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER SLAVKO CESTNIK & TIFFANY CLAIR
CESTNIK
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PETER WILLIAM HEARMAN & PENELOPE
JANE HEARMAN & JOHN MICHAEL HEARMAN (223)
|
|
|
1,237
|
|
|
|
*
|
|
|
|
1,237
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PHILIP BLAKE & SUSAN BLAKE &
ELIZABETH BLAKE & RYAN BLAKE (224)
|
|
|
2,496
|
|
|
|
*
|
|
|
|
2,496
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
PHILIP WILLIAM GRAYSON
|
|
|
1,004
|
|
|
|
*
|
|
|
|
1,004
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PHILLIP A. COLE
|
|
|
950
|
|
|
|
*
|
|
|
|
950
|
|
|
|
0
|
|
|
|
0.00
|
%
|
PRASHANTA KUMAR CHATTERJEE & JENNIFER
CHATTERJEE & ROBINDRA NARAYAN CHATTERJEE (225)
|
|
|
128
|
|
|
|
*
|
|
|
|
128
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RUSSELL FRANCEIS WOODROW & HELEN
ELSIE WOODROW (226)
|
|
|
4,036
|
|
|
|
*
|
|
|
|
4,036
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RAMANI SAMINATHAN & JAYA RANI SUBRAMANIAN
(227)
|
|
|
419
|
|
|
|
*
|
|
|
|
419
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RACHEL NICOLE JOYCE
|
|
|
314
|
|
|
|
*
|
|
|
|
314
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RAELENE DEBRA HAMILTON
|
|
|
409
|
|
|
|
*
|
|
|
|
409
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RAJAGUNALAN RASIAH & DEVAKI JANAKI
RASIAH (228)
|
|
|
1,400
|
|
|
|
*
|
|
|
|
1,400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RANDALL JUDE BEZAIRE & ALISON MAY
BEZAIRE (229)
|
|
|
6,018
|
|
|
|
*
|
|
|
|
6,018
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RANDHIR VARMA & LEIGH VARMA (230)
|
|
|
124
|
|
|
|
*
|
|
|
|
124
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RAY NEILSEN (231)
|
|
|
439
|
|
|
|
*
|
|
|
|
439
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RAYMOND CRAWSHAW & BRENDA CRAWSHAW
|
|
|
1,023
|
|
|
|
*
|
|
|
|
1,023
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RAYMOND NEILSEN
|
|
|
645
|
|
|
|
*
|
|
|
|
645
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RAYMOND THOMAS CHENSEE
|
|
|
404
|
|
|
|
*
|
|
|
|
404
|
|
|
|
0
|
|
|
|
0.00
|
%
|
REBECCA HOUGHTON
|
|
|
380
|
|
|
|
*
|
|
|
|
380
|
|
|
|
0
|
|
|
|
0.00
|
%
|
REBECCA LOUISE STEPHAN
|
|
|
429
|
|
|
|
*
|
|
|
|
429
|
|
|
|
0
|
|
|
|
0.00
|
%
|
REBECCA MARGOT HANSEN
|
|
|
1,400
|
|
|
|
*
|
|
|
|
1,400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RETO JAMES DUNN (232)
|
|
|
1,503
|
|
|
|
*
|
|
|
|
1,503
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RICHARD HOWE & CHRIS SERTIC
|
|
|
1,020
|
|
|
|
*
|
|
|
|
1,020
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RICHARD JAMES PICKETT MARKS & CATHERINE
JANE MARKS
|
|
|
1,400
|
|
|
|
*
|
|
|
|
1,400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RICO SCHUTTE
|
|
|
100
|
|
|
|
*
|
|
|
|
100
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RITA TACCONE & DOMENICO TACCONE
|
|
|
1,056
|
|
|
|
*
|
|
|
|
1,056
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT ANDREW BLISS
|
|
|
1,554
|
|
|
|
*
|
|
|
|
1,554
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT ANDREW BLISS & WENDY ANN
BLISS (233)
|
|
|
18,358
|
|
|
|
*
|
|
|
|
18,358
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT CHARLES WALTERS & MARY ANN
WALTERS
|
|
|
880
|
|
|
|
*
|
|
|
|
880
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT G. KATZ
|
|
|
343
|
|
|
|
*
|
|
|
|
343
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT GEORGE PRENDERGAST & MAREE
ANN PRENDERGAST
|
|
|
5,000
|
|
|
|
*
|
|
|
|
5,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT GEORGE PRENDERGAST & MAREE
ANN PRENDERGAST (234)
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT MALCOLM WILKIE
|
|
|
1,402
|
|
|
|
*
|
|
|
|
1,402
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT MALCOLM WILKIE & LINDA ELIZABETH
WILKIE (235)
|
|
|
9,850
|
|
|
|
*
|
|
|
|
9,850
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
ROBERT MARK PRUYN &
MEREDITH ANNE PRUYN (236)
|
|
|
1,536
|
|
|
|
*
|
|
|
|
1,536
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT PRUYN
|
|
|
13,227
|
|
|
|
*
|
|
|
|
13,227
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBERT STANLEY HOLLE
|
|
|
300
|
|
|
|
*
|
|
|
|
300
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROBYN QUICK
|
|
|
1,872
|
|
|
|
*
|
|
|
|
1,872
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROGER YOUIL & LUCY YOUIL (237)
|
|
|
5,018
|
|
|
|
*
|
|
|
|
5,018
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RON ANTHONY (238)
|
|
|
716
|
|
|
|
*
|
|
|
|
716
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RONALD ROUWENHURST (239)
|
|
|
5,000
|
|
|
|
*
|
|
|
|
5,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RONALD PETER KUCHARSKI (240)
|
|
|
17,759
|
|
|
|
*
|
|
|
|
17,759
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RONALD VANDERWAAL & HEATHER JOY
VANDERWAAL & BENJAMIN JAY VANDERWAAL
|
|
|
5,337
|
|
|
|
*
|
|
|
|
5,337
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROSS ARDITA & MARIA ARDITA
|
|
|
104
|
|
|
|
*
|
|
|
|
104
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROSS NOEL ULLMAN & SUZANNE ULLMAN
(241)
|
|
|
15,800
|
|
|
|
*
|
|
|
|
15,800
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROWAN FOX
|
|
|
9,164
|
|
|
|
*
|
|
|
|
9,164
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROYAL CHARLES ROLLEY & MAREE ELMA
ROLLEY (242)
|
|
|
2,132
|
|
|
|
*
|
|
|
|
2,132
|
|
|
|
0
|
|
|
|
0.00
|
%
|
ROY BENSON (243)
|
|
|
7,000
|
|
|
|
*
|
|
|
|
7,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RUSSELL BROWN & STEVEN WEBB (244)
|
|
|
4,700
|
|
|
|
*
|
|
|
|
4,700
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RUSSELL JOHN WILKIE
|
|
|
401
|
|
|
|
*
|
|
|
|
401
|
|
|
|
0
|
|
|
|
0.00
|
%
|
RUSSELL JOHN WILKIE & ROBYN LOUISA
WILKIE (245)
|
|
|
2,523
|
|
|
|
*
|
|
|
|
2,523
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SAMANTHA ANN STEWART
|
|
|
100
|
|
|
|
*
|
|
|
|
100
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SAMEER PRASAD
|
|
|
2,806
|
|
|
|
*
|
|
|
|
2,806
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SANDRA FAY LOCK
|
|
|
1,260
|
|
|
|
*
|
|
|
|
1,260
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SANTINO ANTHONY MASTROENI
|
|
|
16,461
|
|
|
|
*
|
|
|
|
16,461
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SARAH FRANCES OAKES
|
|
|
437
|
|
|
|
*
|
|
|
|
437
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SASCHA RUST
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SCOTT LESLIE GANT (246)
|
|
|
60,890
|
|
|
|
*
|
|
|
|
60,890
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SCOTT PATTERSON
|
|
|
300
|
|
|
|
*
|
|
|
|
300
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SCOTT PRENDERGAST
|
|
|
435
|
|
|
|
*
|
|
|
|
435
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SCOTT RUSSELL SPLADE & CAROL GAE
SPLADE
|
|
|
6,755
|
|
|
|
*
|
|
|
|
6,755
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SEAMUS MARTIN (247)
|
|
|
6,970
|
|
|
|
*
|
|
|
|
6,970
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SEAN CHRISTOPHER DAVID NUGARA &
MICHELLE MARIA NUGARA
|
|
|
1,380
|
|
|
|
*
|
|
|
|
1,380
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SEAN NUGARA & MICHELLE NUGARA (248)
|
|
|
1,053
|
|
|
|
*
|
|
|
|
1,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
SERGIO FORZA (249)
|
|
|
8,959
|
|
|
|
*
|
|
|
|
8,959
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SHANE SIKORA (250)
|
|
|
596
|
|
|
|
*
|
|
|
|
596
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SHANNON MCMAHON
|
|
|
4,000
|
|
|
|
*
|
|
|
|
4,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SHANULISA PRASAD
|
|
|
405
|
|
|
|
*
|
|
|
|
405
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SHARAD VED PRAKASH & NEH CHIB VED
PRAKASH
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SHARNAH THOMPSON (251)
|
|
|
171
|
|
|
|
*
|
|
|
|
171
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SHEELAGM YOUNG (252)
|
|
|
1,870
|
|
|
|
*
|
|
|
|
1,870
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SHEHARA WIJETUNGA
|
|
|
170
|
|
|
|
*
|
|
|
|
170
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SHELLEY MARIE FOX
|
|
|
2,439
|
|
|
|
*
|
|
|
|
2,439
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SHERYLE SHERIDAN (253)
|
|
|
1,199
|
|
|
|
*
|
|
|
|
1,199
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SIOBHAN MARTIN
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
STEPHEN BURNS & ROSALIND BURNS (254)
|
|
|
2,839
|
|
|
|
*
|
|
|
|
2,839
|
|
|
|
0
|
|
|
|
0.00
|
%
|
STEPHEN COX & WENDY COX (255)
|
|
|
8,450
|
|
|
|
*
|
|
|
|
8,450
|
|
|
|
0
|
|
|
|
0.00
|
%
|
STEPHEN DOMINIC FRANCIS CREAGH &
JOHANNA BROOKE CREAGH
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
STEPHEN FOX
|
|
|
7,053
|
|
|
|
*
|
|
|
|
7,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
STEPHEN JOHN & LISA SIMONE GREENHAM
(256)
|
|
|
100
|
|
|
|
*
|
|
|
|
100
|
|
|
|
0
|
|
|
|
0.00
|
%
|
STEPHEN PATTERSON & CHERYL PATTERSON
(257)
|
|
|
1,715
|
|
|
|
*
|
|
|
|
1,715
|
|
|
|
0
|
|
|
|
0.00
|
%
|
STEPHEN ROBERT BIDELEUX
|
|
|
1,501
|
|
|
|
*
|
|
|
|
1,501
|
|
|
|
0
|
|
|
|
0.00
|
%
|
STEWART CRAIG DOBRZYNSKI & FIONA
JOANNE DOBRZYNSKI (258)
|
|
|
2,135
|
|
|
|
*
|
|
|
|
2,135
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SUSAN MONGELLI & PETER WATERS (259)
|
|
|
311
|
|
|
|
*
|
|
|
|
311
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SUSAN STORIE
|
|
|
200
|
|
|
|
*
|
|
|
|
200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SUZANNE KAYE JONES (260)
|
|
|
3,000
|
|
|
|
*
|
|
|
|
3,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SUZANNE KAYE JONES
|
|
|
500
|
|
|
|
*
|
|
|
|
500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
SUZANNE MARIA SEWELL
|
|
|
600
|
|
|
|
*
|
|
|
|
600
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TALBOT CHINCHEN & GAY CLOVER CHINCHEN
(261)
|
|
|
6,000
|
|
|
|
*
|
|
|
|
6,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TARA LEANNE WINCKEL & PAUL JOSEPH
VAN WINCKEL
|
|
|
1,400
|
|
|
|
*
|
|
|
|
1,400
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TERRENCE GERARD CARROLL & SHARON
THERESE CARROLL (262)
|
|
|
4,440
|
|
|
|
*
|
|
|
|
4,440
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TERRY HARRINGTON & JULIE THOMAS
HARRINGTON
|
|
|
1,510
|
|
|
|
*
|
|
|
|
1,510
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TERRY ANN ROTH
|
|
|
2,954
|
|
|
|
*
|
|
|
|
2,954
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TERRY ANN ROTH & ADAM DANIEL BOWLING
(263)
|
|
|
3,430
|
|
|
|
*
|
|
|
|
3,430
|
|
|
|
0
|
|
|
|
0.00
|
%
|
Name
of Beneficial Owner
|
|
No.
of Shares Owned Prior to Offering
|
|
|
Percent
of Shares Beneficially Owned Prior to Offering
|
|
|
No.
of Shares Being Offered
|
|
|
No.
of Shares Beneficially Owned After Offering
|
|
|
Percent
of Shares Beneficially Owned After Offering
|
|
TERRY CARROLL
|
|
|
2,027
|
|
|
|
*
|
|
|
|
2,027
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TERRY JAMES HARRINGTON
|
|
|
402
|
|
|
|
*
|
|
|
|
402
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TERRY JAMES HARRINGTON & JULIE DIANE
THOMAS
|
|
|
808
|
|
|
|
*
|
|
|
|
808
|
|
|
|
0
|
|
|
|
0.00
|
%
|
THABOJAN RASIAH (264)
|
|
|
2,800
|
|
|
|
*
|
|
|
|
2,800
|
|
|
|
0
|
|
|
|
0.00
|
%
|
THOMAS ASHCROFT & JULIA PATRICIA
ASHCROFT (265)
|
|
|
401
|
|
|
|
*
|
|
|
|
401
|
|
|
|
0
|
|
|
|
0.00
|
%
|
THOMAS ERNEST HORGAN
|
|
|
1,747
|
|
|
|
*
|
|
|
|
1,747
|
|
|
|
0
|
|
|
|
0.00
|
%
|
THOMAS ERNEST HORGAN & ANNE THERESE
HORGAN (266)
|
|
|
736
|
|
|
|
*
|
|
|
|
736
|
|
|
|
0
|
|
|
|
0.00
|
%
|
THOMAS GRAHAM SHEEHAN & JOHN DOUGLAS
SHEEHAN (267)
|
|
|
1,053
|
|
|
|
*
|
|
|
|
1,053
|
|
|
|
0
|
|
|
|
0.00
|
%
|
THOMAS OAKES
|
|
|
200
|
|
|
|
*
|
|
|
|
200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TIM HARGREAVES (268)
|
|
|
5,482
|
|
|
|
*
|
|
|
|
5,482
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TIM SMITH (269)
|
|
|
2,143
|
|
|
|
*
|
|
|
|
2,143
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TIMOTHY PETER FARLEY & MARY KATHLEEN
FARLEY (270)
|
|
|
8,666
|
|
|
|
*
|
|
|
|
8,666
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TIMOTHY JOHN OLIVER (271)
|
|
|
3,579
|
|
|
|
*
|
|
|
|
3,579
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TIMOTHY ROSS CROOKS
|
|
|
555
|
|
|
|
*
|
|
|
|
555
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TIMOTHY ROSS FLOWERS & MONIQUE LYNETTE
FLOWERS (272)
|
|
|
1,500
|
|
|
|
*
|
|
|
|
1,500
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TINA DION (273)
|
|
|
204
|
|
|
|
*
|
|
|
|
204
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TODD SESSIONS
|
|
|
569
|
|
|
|
*
|
|
|
|
569
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TONY HAVIG (274)
|
|
|
2,980
|
|
|
|
*
|
|
|
|
2,980
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TONY JORDAN & DENISE MURPHY (275)
|
|
|
125
|
|
|
|
*
|
|
|
|
125
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TRACEY ANN REILLY
|
|
|
2,010
|
|
|
|
*
|
|
|
|
2,010
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TRACY WALPOLE
|
|
|
1,000
|
|
|
|
*
|
|
|
|
1,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TREVOR SCHOENMACHER & LISA STRIBLEY
& BRETT HANSEN (276)
|
|
|
246
|
|
|
|
*
|
|
|
|
246
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TRUDY PIA MARIA CROOKS
|
|
|
555
|
|
|
|
*
|
|
|
|
555
|
|
|
|
0
|
|
|
|
0.00
|
%
|
VERA SMOLONOGOV
|
|
|
406
|
|
|
|
*
|
|
|
|
406
|
|
|
|
0
|
|
|
|
0.00
|
%
|
VICKI BELL & GRAHAM BELL (277)
|
|
|
3,941
|
|
|
|
*
|
|
|
|
3,941
|
|
|
|
0
|
|
|
|
0.00
|
%
|
VICKI JUNE BELL
|
|
|
3,770
|
|
|
|
*
|
|
|
|
3,770
|
|
|
|
0
|
|
|
|
0.00
|
%
|
VINCENT CONRAD CREAGH (278)
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
VINCENT JOHN CREAGH (279)
|
|
|
9,465
|
|
|
|
*
|
|
|
|
9,465
|
|
|
|
0
|
|
|
|
0.00
|
%
|
VITTORIO MONARCA & CATHERINE MONARCA
(280)
|
|
|
225
|
|
|
|
*
|
|
|
|
225
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WARREN CLAUDE SLATER & DIERDRE ANNE
SLATER (281)
|
|
|
3,618
|
|
|
|
*
|
|
|
|
3,618
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WAYNE CAREY
|
|
|
2,472
|
|
|
|
*
|
|
|
|
2,472
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WAYNE FRANCIS SYKES
|
|
|
1,250
|
|
|
|
*
|
|
|
|
1,250
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WAYNE FRANCIS SYKES (282)
|
|
|
4,000
|
|
|
|
*
|
|
|
|
4,000
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WILLIAM JOHN VALLENCE
|
|
|
1,185
|
|
|
|
*
|
|
|
|
1,185
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WILLIAM MAILE & KATHARINE BLACKMORE
& XI DAI DIEP & CRAIG DAVID PRINCE (283)
|
|
|
9,020
|
|
|
|
*
|
|
|
|
9,020
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WILLIAM OAKES
|
|
|
200
|
|
|
|
*
|
|
|
|
200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WILLIAM PETER MAILE
|
|
|
14,258
|
|
|
|
*
|
|
|
|
14,258
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WILLIAM ROSS TAYLOR & HELEN LARAINE
TAYLOR (284)
|
|
|
225
|
|
|
|
*
|
|
|
|
225
|
|
|
|
0
|
|
|
|
0.00
|
%
|
WILLIAM ROY JACKSON & DAWN CAROL
JACKSON
|
|
|
4,579
|
|
|
|
*
|
|
|
|
4,579
|
|
|
|
0
|
|
|
|
0.00
|
%
|
YUANYUAN CHU
|
|
|
3,200
|
|
|
|
*
|
|
|
|
3,200
|
|
|
|
0
|
|
|
|
0.00
|
%
|
TOTAL
|
|
|
9,089,220
|
|
|
|
|
|
|
|
9,089,220
|
|
|
|
|
|
|
|
|
|
*
|
Less
than 1% of the outstanding shares of common stock.
|
|
|
(1)
|
Paul
Mathieson is our Chairman, CEO and the major shareholder of IEGH.
|
|
|
(2)
|
Of
these shares, 121,120 shares are owned by Fenwick Corporation Pty Ltd (“Fenwick”). Fenwick is the trustee for
Fenwick Investment A/C. The selling stockholder is the director of Fenwick and the beneficiary of Fenwick Investment A/C.
5,891 of these shares are owned by C T Super Pty Ltd. The selling stockholder is the director of C T Super Pty Ltd. 56,378
shares are held by Clem Tacca Pty Ltd as trustee for Clem Tacca Family A/C. The selling stockholder is the director of Clem
Tacca Pty Ltd and the beneficiary of Clem Tacca Family A/C. 20,000 shares are held by Triple 8 Group Pte. Ltd. The selling
stockholder is the director of Triple 8 Group Pte. Ltd.
|
|
|
(3)
|
Of
these shares, 756 are owned by Erstein Pty Limited as trustee for Hartland Super Fund A/C. The selling stockholders are the
directors of Erstein Pty Limited.
|
|
|
(4)
|
Of
these shares, 6,000 shares are owned by Alan Lamb and Sandra Givens as trustee for the Glamourous Superannuation Fund.
|
|
|
(5)
|
Of
these shares, 4,207 shares are owned by Sacco Developments Australia Pty Limited as trustee for the Sacco Family A/C. The
selling stockholder is the director of Sacco Developments Australia Pty Limited.
|
|
|
(6)
|
Of
these shares, 5,503 shares are owned by Quantum One Pty Ltd as trustee for the Crown Domain A/C. The selling stockholder is
the director of Quantum One Pty Ltd.
|
|
|
(7)
|
Of
these shares, 1,737 shares are owned by Alicia Breamer Keall as trustee for Queenwood Superannuation Fund A/C.
|
|
|
(8)
|
Of
these shares, 1,417 shares are owned by A & K Dyer Pty Ltd. The selling stockholders are directors of A & K Dyer Pty
Ltd.
|
|
|
(9)
|
Of
these shares, 491 are owned by Pachira Aquatica Pty Ltd as trustee for Pachira Aquatica Family A/C. The selling stockholders
are the directors of Pachira Aquatica Pty Ltd.
|
|
|
(10)
|
Of
these shares, 6,005 shares are owned by A F H M Pty Ltd. The selling stockholders are the directors of A F H M Pty Ltd.
|
(11)
|
Of
these shares, 4,500 shares are held by the selling stockholders as trustee for the A.J. Zillman Family Trust.
|
|
|
(12)
|
Of
these shares, 460 shares are held by the selling stockholders as trustee for The Kelly Family Settlement Trust.
|
|
|
(13)
|
Of
these shares, 36,975 shares are held by A Maggiotto Nominees Pty Ltd, as trustee for Maggiotto Super Fund A/C. The selling
stockholders are the beneficiaries of the Maggiotto Super Fund A/C.
|
|
|
(14)
|
Of
these shares, 8,543 shares are held directly, and 1,000 shares are held by the selling stockholder as trustee for the Angus
Wilkie Super Fund.
|
|
|
(15)
|
Of
these shares, 839 shares are held directly and 426 shares are held by the selling stockholders as trustees for the Anthony
Badger & Linda Kachel Super Fund.
|
|
|
(16)
|
Of
these shares, 555 shares are held by Comserve Management Limited as trustee for Greenfield A/C. The selling stockholders are
the directors of Comserve Management Limited.
|
|
|
(17)
|
Of
these shares, 586 are held by Cornerstone Ventures Pty Ltd. The selling stockholder is the director of Cornerstone Ventures
Pty Ltd.
|
|
|
(18)
|
Of
these shares, 522 shares are held by Anthony and Abigail Kooy as trustees for the A&A Kooy Super Fund.
|
|
|
(19)
|
Of
these shares, 1,644 shares are held by Vanchem Pty Ltd, as trustee for Madeclaire Super Fund A/C. The selling stockholders
are the directors of Vanchem Pty Ltd.
|
|
|
(20)
|
Of
these shares, 228 shares are held directly and 329 are held by Piesse Investments Pty Ltd, as trustee for the Piesse Super
Fund A/C. The selling stockholder is the director of Piesse Investments Pty Ltd.
|
|
|
(21)
|
Of
these shares, 3,592 shares are held by Northam Park Pty Ltd as trustee for the B & CA Hudson Super Fund A/C. The selling
stockholders are the directors of Northam Park Pty Ltd.
|
|
|
(22)
|
Of
these shares, 3,800 shares are held by the selling stockholders as trustee for the Barry Brown Superannuation Fund.
|
|
|
(23)
|
Of
these shares, 4,641 shares are held by BJ & BL Gant Pty Ltd as trustee for Gant Super Fund A/C. The selling stockholders
are the directors of BJ & BL Gant Pty Ltd.
|
|
|
(24)
|
Of
these shares, 1,500 shares are held by Barry Oates and Alexandra Watts as trustees for the Oates Family S/F A/C.
|
|
|
(25)
|
Of
these shares, 7,500 shares are held by Ossum Holdings Pty Ltd as trustee for Tanton Super Fund A/C. The selling stockholders
are the directors of Ossum Holdings Pty Ltd.
|
(26)
|
Of
these shares, 4,032 shares are held by Mr. Barry Watson and Mrs. Janet Watson as trustees for the Watson Family S/F A/C.
|
|
|
(27)
|
Of
these shares, 2,861 shares are held by Blue Eagle Investments Pty Ltd as trustee for the Blue Eagle Super Fund A/C. The selling
stockholders are the directors of Blue Eagle Investments Pty Ltd.
|
|
|
(28)
|
Of
these shares, 2,600 shares are owned by BW Equities Pty Ltd. The selling stockholder is the director of BW Equities Pty Ltd.
|
|
|
(29)
|
Of
these shares, 169 shares are held by Aviwed Pty Ltd as trustee for the Mellers Family A/C. The selling stockholder is the
director of Aviwed Pty Ltd.
|
|
|
(30)
|
Of
these shares, 3,209 shares are held by Mrs. Bonnie June Goodrich and Mrs. Marney Renee Jefferies as trustees for the Sea Change
Super Fund A/C.
|
|
|
(31)
|
Of
these shares, 2,898 shares are held by the selling stockholder as trustee for the Prowse Family Investment A/C.
|
|
|
(32)
|
Of
these shares, 857 shares are held by Mr. Brett Andrew Hansen and Mrs. Jennifer Louise Hansen as trustees for Greenpeas Super
Fund A/C, and 176 shares are held by Greenpeas Investments Pty Ltd as trustees for The B & J Hansen Family A/C. The selling
stockholders are the directors of Greenpeas Investments Pty Ltd.
|
|
|
(33)
|
Of
these shares, 683 shares are held by Doynton Holdings Pty Ltd as trustee for The Think Big A/C. The selling stockholder is
the director of Doynton Holdings Pty Ltd.
|
|
|
(34)
|
Of
these shares, 2,572 shares held by the selling stockholders as trustees for The BF & SK Garnett Family Trust.
|
|
|
(35)
|
Of
these shares, 147 shares are held by Brian Martin & Associates Pty Ltd as trustee
for the Brian Martin S/F A/C. The selling stockholders are the directors of Brian Martin
& Associates Pty Ltd.
|
(36)
|
Of
these shares, 5,326 shares are owned by Brian Matthews as trustee for the Matthews Future Fund. The selling stockholder is
the beneficiary of the Matthews Future Fund.
|
|
|
(37)
|
Of
these shares, 20,636 shares are held by Jash Pty Ltd as trustee for the Bruce Hinckfuss Super Fund and 7,500 shares are held
by Jash Pty Ltd as trustee for the Bruce Hinckfuss Family Trust. The selling stockholder is the director of Jash Pty Ltd.
|
|
|
(38)
|
Of
these shares, 4,053 shares are held by Queenwood Orchard Trust. The selling stockholder is the trustee of Queenwood Orchard
Trust. 2,526 are held by Charlie Keall Super Pty Ltd as trustee for Charlie Keall Superannuation Fund. The selling stockholder
is the director of Charlie Keall Super Pty Ltd.
|
|
|
(39)
|
Of
these shares, 109 shares are held by Payne Corporation Pty Ltd as trustee for the Payne Super Fund A/C. The selling stockholder
is the director of Payne Corporation Pty Ltd.
|
|
|
(40)
|
Of
these shares, 420 shares are held by First Equity Capital Pty Ltd as trustee for the First Equity Finance FND A/C. The selling
stockholders are the directors of First Equity Capital Pty Ltd.
|
(41)
|
Of
these shares, 4,000 shares are held by Widerange Corporation Pty Ltd. The selling stockholder is the director of Widerange
Corporation Pty Ltd.
|
|
|
(42)
|
Of
these shares, 578 shares are held by Exford Grange Pty Ltd as trustee for the Arid Zone Super Fund. The selling stockholder
is the director of Exford Grange Pty Ltd.
|
|
|
(43)
|
Held
by the selling stockholder as trustee for Pot of Gold Super Fund.
|
|
|
(44)
|
Of
these shares, 10,971 shares are held by Colmar Enterprises (QLD) Pty Ltd as trustee for the Burton Family Discretionary Trust.
The selling stockholder is the director of Colmar Enterprises (QLD) Pty Ltd.
|
|
|
(45)
|
Of
these shares, 3,257 shares are held directly and 3,060 shares are held by the selling stockholder as trustee for the Cardub
Super Fund.
|
|
|
(46)
|
Held
by the selling stockholders as trustee for The Trinity Super Fund A/C.
|
|
|
(47)
|
Held
by Gorcris Pty Ltd as trustee for The Main Trust Trading as GJ & C Maslin. The selling stockholder is the director of
Gorcris Pty Ltd.
|
|
|
(48)
|
Of
these shares, 1,402 shares are held by X C Lent Developments Pty Ltd, and 5,708 are held by the selling stockholders as trustees
for the Kozicki Super Fund A/C. The selling stockholders are the directors of X C Lent Developments Pty Ltd.
|
|
|
(49)
|
Of
these shares, 238 shares are held by Daak Gibson Holdings Pty Ltd as trustee for the Daak Gibson Family A/C. The selling stockholder
is the director of Daak Gibson Holdings Pty Ltd.
|
|
|
(50)
|
Of
these shares, 8,000 shares are held by C F Superfund Pty Ltd as trustee for the C F Super Fund A/C, and 8,000 shares are held
by Plan B Investments Pty Ltd as trustee for PBI A/C. The selling stockholder is the director of C F Superfund Pty Ltd and
Plan B Investments Pty Ltd.
|
|
|
(51)
|
Of
these shares, 482 shares are held by the selling stockholder as trustee for Synoptic Super Fund.
|
|
|
(52)
|
Of
these shares, 10,822 shares are held by Dansan (AUST) Pty Ltd as trustee for the Dansan Family A/C, 1,793 are held by Paladin
Global Industries Pty Ltd as trustee for SGF Planet A/C, and 621 shares are held by Dansan (AUST) Pty Ltd as trustee for the
D Fam & Ellon Noms P/L A/C. The selling stockholder is the director of Dansan (AUST) Pty Ltd and Paladin Global Industries
Pty Ltd.
|
|
|
(53)
|
Of
these shares, 7,305 shares are held by Optimal Equity Pty Ltd. The selling stockholders are the directors of Optimal Equity
Pty Ltd.
|
|
|
(54)
|
Held
by the selling stockholders as trustee for The O’Connell Superannuation Fund.
|
|
|
(55)
|
Of
these shares, 11,611 shares are held by Vaingirl Nominees Pty Ltd as trustee for Hector Henry Holdings A/C, and 1,403 shares
are held by Vaingirl Nominees Pty Ltd as trustee for Sunday Trading A/C. The selling stockholder is director of Vaingirl Nominees
Pty Ltd.
|
(56)
|
Of
these shares, 129 shares are held by Jaxland Pty Ltd as trustee for the D & L Putland Family A/C. The selling stockholder
is the director of Jaxland Pty Ltd.
|
|
|
(57)
|
Of
these shares, 1,423 shares are held by the selling stockholder as trustee for DS Hutchinson Super A/C.
|
|
|
(58)
|
Of
these shares, 1,401 shares are held by Lock Enterprises Pty Ltd, and 6,579 shares are held by Lock Enterprises Pty Ltd as
trustee for Darryl Lock Super Fund A/C. The selling stockholders are directors of Lock Enterprises Pty Ltd.
|
|
|
(59)
|
Of
these shares, 855 shares are held by the selling stockholders as trustees for the Ward Family Superannuation Fund A/C.
|
|
|
(60)
|
Of
these shares, 42,000 shares are held by Firecrest Estates Ltd. The selling stockholder is the director of Firecrest Estates
Ltd.
|
|
|
(61)
|
Of
these shares, 612 shares are held by the selling stockholders as trustees for the Superfund A/C.
|
|
|
(62)
|
Of
these shares, 279 shares are held by Davco Constructions Pty Ltd. The selling stockholder is the director of the Davco Constructions
Pty Ltd.
|
|
|
(63)
|
Of
these shares, 1,000 shares are held by David Jenkinson & Assoc Pty Ltd as trustee for the Jenkinson Family S/F A/C. The
selling stockholder is the director of David Jenkinson & Assoc Pty Ltd.
|
|
|
(64)
|
Of
these shares, 5,395 shares are held by the selling stockholder as trustee for The Highvale Family A/C, and 6,698 shares are
held by Ravefield Pty as trustee for The Highvale S/F A/C. The selling stockholder is director of Ravefield Pty.
|
|
|
(65)
|
Of
these shares, 5,789 shares are held directly and 2,000 shares are held by Davken Pty Ltd. The selling stockholder is the director
of Davken Pty Ltd.
|
|
|
(66)
|
Held
by the selling stockholders as trustees for the Spearhead Superannuation Fund.
|
|
|
(67)
|
Of
these shares, 558 shares are held by Kenobi Holdings Pty Ltd as trustee for Kenobi Super A/C and 418 shares are held by Kenobi
Holdings Pty Ltd as trustee for The Caspero Unit A/C. The selling stockholder is director of Kenobi Holdings Pty Ltd.
|
|
|
(68)
|
Of
these shares, 420 shares are held directly and 1,832 shares are held by Austallus Pty Ltd as trustee for Austallus Super Fund
A/C. The selling stockholders are directors of Austallus Pty Ltd.
|
|
|
(69)
|
Of
these shares, 1,486 shares are held by the selling stockholders as trustees for O’Connor Williams S/F A/C.
|
|
|
(70)
|
Of
these shares, 515 shares are held by Durand Holdings Pty Ltd as trustee for Durand Investment A/C. The selling stockholder
is director of Durand Holdings Pty Ltd.
|
(71)
|
Of
these shares, 7,074 shares are held by Augustwave Pty Ltd as trustee for Augustwave Super A/C. The selling stockholders are
directors of Augustwave Pty Ltd.
|
|
|
(72)
|
Of
these shares, 1,525 shares are held by Venoace Pty Ltd as trustee for Johnson Family Discretionary A/C No. 2. The selling
stockholder is director of Venoace Pty Ltd.
|
|
|
(73)
|
Of
these shares, 12,695 shares are held by Domenic Tacca Pty Ltd as trustee for Domenic Tacca Family A/C. The selling stockholder
is the director of Domenic Tacca Pty Ltd.
|
|
|
(74)
|
Of
these shares, 1,140 shares are held by the selling stockholders as trustees for Tuscany Super Fund A/C.
|
|
|
(75)
|
Of
these shares, 1,775 shares are held by Torwood General Cleaning Services Pty Ltd as trustee for Executive Super Fund A/C.
The selling stockholders are directors of Torwood General Cleaning Services Pty Ltd.
|
|
|
(76)
|
Of
these shares, 393 shares are held by Wendon Holdings Pty Limited as trustee for Wendon Family Property A/C. The selling stockholders
are directors of Wendon Holdings Pty Limited.
|
|
|
(77)
|
Of
these shares, 763 shares are held by the selling stockholders as trustees for the Swain Family Pension A/C.
|
|
|
(78)
|
Of
these shares, 135 shares are held by Addvokat Pty Ltd as trustee for Addvokat A/C. The selling stockholder is director of
Addvokat Pty Ltd.
|
|
|
(79)
|
Of
these shares, 1,250 shares are held by Danmag Pty Ltd as trustee for The Douglas A. Nicholson Superannuation Fund. The selling
stockholder is director of Danmag Pty Ltd.
|
|
|
(80)
|
Of
these shares, 5,000 shares are held by Amber Valley Orchid Pty Ltd as trustee for the Amber Valley Superannuation Fund. The
selling stockholder is director of Amber Valley Orchid Pty Ltd.
|
|
|
(81)
|
Of
these shares, 5,000 shares are held by Kingdom Building, Inc. The selling stockholder is director of Kingdom Building, Inc.
|
|
|
(82)
|
Of
these shares, 6,000 shares are held by the selling stockholders as trustees for the Morgan Superannuation A/C.
|
|
|
(83)
|
Of
these shares, 240 shares are held by Elms Lazurko Superannuation Pty Ltd as trustee for the Elms Lazurko Super A/C. The selling
stockholder is director of Elms Lazurko Superannuation Pty Ltd.
|
|
|
(84)
|
Of
these shares, 550 shares are held by E & C Georgiou Num Pty Ltd as trustee for The Emilious Georgiou A/C, 460 shares are
held by the selling stockholder as trustee for Georgiou Super Fund A/C. The selling stockholder is director of E & C Georgiou
Num Pty Ltd.
|
|
|
(85)
|
Of
these shares, 5,496 shares are held by Dyer Farms Pty Ltd as trustee for Tooronga Farms Ret Fund A/C. The selling stockholders
are directors of Dyer Farms Pty Ltd.
|
(86)
|
Of
these shares, 5,900 shares are held by the selling stockholder as trustee for the Evert Pol SMSF.
|
|
|
(87)
|
Of
these shares, 5,877 shares are held by Faldison Pty Ltd. The selling stockholder is director of Faldison Pty Ltd.
|
|
|
(88)
|
Of
these shares, 24,559 shares are held by Mortgage Brokers Pty Ltd as trustee for Frank Wilkie Super Fund A/C. The selling stockholder
is beneficiary of the Frank Wilkie Super Fund A/C and Director of Mortgage Brokers Pty Ltd.
|
|
|
(89)
|
Of
these shares, 1,498 shares are held by Selected Smash Repairs Pty Ltd. The selling stockholder is the director of Selected
Smash Repairs Pty Ltd.
|
|
|
(90)
|
Held
by Radmee Pty Ltd as trustee for Ganesh Radmee Superannuation Fund. The selling stockholder is director of Radmee Pty Ltd.
|
|
|
(91)
|
Held
by the selling stockholders as trustee of the McKenzie Superfund A/C.
|
|
|
(92)
|
Of
these shares, 2,100 shares are held by Jomaro Pty Ltd. The selling stockholder is the director of Jomaro Pty Ltd.
|
|
|
(93)
|
Of
these shares, 4,089 shares are held by Galico Pty Ltd as trustee for Lacono Family A/C. The selling stockholder is director
of Galico Pty Ltd.
|
|
|
(94)
|
Of
these shares, 1,333 shares are held by the selling stockholders as trustees for The Columbus Super Fund A/C.
|
|
|
(95)
|
Of
these shares, 1,000 shares are held by GFF Holdings Pty Ltd as trustee for GFF Superannuation Fund A/C. The selling stockholder
is director of GFF Holdings Pty Ltd.
|
|
|
(96)
|
Of
these shares, 5,657 shares are held by the selling stockholders as trustees for GL & CJ Godley S/F A/C, 4,112 shares are
held by the selling stockholders directly, and 7,974 shares are held by Chellema Investment Co Pty Ltd as trustee for Trading
A/C. The selling stockholders are directors of Chellema Investment Co Pty Ltd.
|
|
|
(97)
|
Of
these shares, 1,002 shares are held by Bolzano Investments Pty Ltd. The selling stockholders are directors of Bolzano Investments
Pty Ltd.
|
|
|
(98)
|
Of
these shares, 2,699 shares are held by the selling stockholder as trustee for Paradigm Develop S/F A/C.
|
|
|
(99)
|
Of
these shares, 287 shares are held by the selling stockholders as trustees for Paradigm Developments SF.
|
|
|
(100)
|
Of
these shares, 1,057 shares are held directly, and 3,068 shares are held by the selling stockholders as trustees for The Sullivan
Super Fund A/C.
|
(101)
|
Of
these shares, 237 are held directly and 1,666 are held by Valiant Investments Pty Ltd. The selling stockholder is the director
of Valiant Investments Pty Ltd.
|
|
|
(102)
|
Of
these shares, 1,421 shares are held by the selling stockholders as trustees for Life Enrichment Ent S/F A/C.
|
|
|
(103)
|
Of
these shares, 1,433 shares are held by the selling stockholders as trustees for Blair-West Med Pens Fund A/C.
|
|
|
(104)
|
Of
these shares, 9,693 shares are held by G L B Pty Ltd as trustee for The GLB Super Fund A/C, 1,800 shares are held by G L B
Pty Ltd as trustee for The G L Bliss Family A/C, and 1,251 shares are held by G L B Pty Ltd. The selling stockholder is director
of G L B Pty Ltd.
|
|
|
(105)
|
Of
these shares, 273 shares are held by the selling stockholders as trustees for Vlahos Super Fund A/C.
|
|
|
(106)
|
Of
these shares, 4,016 shares are held by Alclare Pty Ltd as trustee for The Blair-West Family A/C. The selling stockholder is
the director of Alclare Pty Ltd.
|
|
|
(107)
|
Of
these shares, 1,745 shares are held by the selling stockholders as trustees for Blair-West Medical S/F A/C.
|
|
|
(108)
|
Of
these shares, 1,138 shares are held by the selling stockholders as trustees for George Nel Super Fund A/C.
|
|
|
(109)
|
Of
these shares, 7,466 shares are held by the selling stockholders as trustees for The Mason Super Fund A/C, and 4,737 shares
are held by the selling stockholders as trustees for The Mason Family A/C.
|
|
|
(110)
|
Of
these shares, 120 shares are held by G A Giusti Construction Pty Limited. The selling stockholders are directors of G A Giusti
Construction Pty Limited.
|
|
|
(111)
|
Of
these shares, 2,060 shares are held by the selling stockholders as trustees for The Joybell Nominees Super Fund.
|
|
|
(112)
|
Of
these shares, 427 shares are held directly, 8,769 shares are held by the selling stockholder and Dana Heriot as trustees for
Gordon Heriot Super Fund A/C, and 848 shares are held by the selling stockholder as trustee for Heriot A/C.
|
|
|
(113)
|
Of
these shares, 2,015 shares are held by the selling stockholders as trustees for Farmcostalota Super Fund A/C, and 3,923 shares
are held by Nattaltri Pty Ltd. The selling stockholders are directors of Nattaltri Pty Ltd.
|
|
|
(114)
|
Of
these shares, 667 shares are held by the selling stockholder as trustee for GL Smith Super Fund A/C.
|
|
|
(115)
|
Of
these shares, 409 shares are held by the selling stockholders as trustees for The Warden Super Fund.
|
(116)
|
Of
these shares, 2,611 shares are held by the selling stockholders as trustees for Gloria Hartney S/Fund A/C.
|
|
|
(117)
|
Of
these shares, 2,000 shares are held by G & F Dennis Superannuation Fund. The selling stockholder is the director of G
& F Dennis Superannuation Fund.
|
|
|
(118)
|
Of
these shares, 2,061 shares are held by Tenni & Associates Pty Ltd as trustee for The Tenni Family A/C, and 440 shares
are held by the selling stockholder as trustee for The Evolution Unit A/C. The selling stockholder is the director of Tenni
& Associates Pty Ltd.
|
|
|
(119)
|
Of
these shares, 1,000 shares are held by Bew’s Kennel Pty Ltd as trustee for Watson Trading A/C. The selling stockholder
is director of Bew’s Kennel Pty Ltd.
|
|
|
(120)
|
With
respect to 8,810 shares, Mr. Hansen shares voting and investment power with his spouse. With respect to 3,205 shares, Mr.
Hansen shares voting and investment power with Trevor Schoenmaker, Lisa Stribley and Brett Hansen.
|
|
|
(121)
|
Of
these shares, 2,248 shares are held by Blue Chip Turf Management Pty Ltd as trustee for Trim Family A/C. The selling stockholders
are directors of Blue Chip Turf Management Pty Ltd.
|
|
|
(122)
|
Of
these shares, 747 shares are held by the selling stockholders as trustees for H & M Ross Retire Fund A/C.
|
|
|
(123)
|
Of
these shares, 5,839 shares are held by Resort Brokers Pty Ltd as trustee for The Crooks Family Superannuation Fund. The selling
stockholders are directors of Resort Brokers Pty Ltd.
|
|
|
(124)
|
Of
these shares, 1,887 shares are held by the selling stockholders as trustees for Foster Superannuation Fund.
|
|
|
(125)
|
Of
these shares, 2,869 shares are held by the selling stockholder as trustee for Patterson Family A/C, and 1,413 shares are held
by the selling stockholder as trustee for The Blume Patterson Unit A/C.
|
|
|
(126)
|
Of
these shares, 5,135 shares are held by the selling stockholders as trustees for Ian Harold Banks S/Fund A/C.
|
|
|
(127)
|
Of
these shares, 11,000 shares are held by the selling stockholders as trustees for the Gilmour Super Fund A/C.
|
|
|
(128)
|
Of
these shares, 1,096 shares are held by Jiah Superannuation Pty Ltd as trustee for Jiah Super Fund. The selling stockholders
are directors of Jiah Super Fund.
|
|
|
(129)
|
Of
these shares, 1,500 shares are held by Kingdell Pty Ltd as trustee for I&N Patterson Superannuation Fund. The selling
stockholders are directors of Kingdell Pty Ltd.
|
|
|
(130)
|
Of
these shares, 3,098 shares are held by Linian Investments Pty Ltd as trustee for Ferntor Holdings Account. The selling stockholder
is director of Linian Investments Pty Ltd.
|
(131)
|
Of
these shares, 3,808 shares are held by the selling stockholders as trustees for Linian Super Fund A/C.
|
|
|
(132)
|
Of
these shares, 150 shares are held by Synman Nominees Pty Ltd as trustee for IMJWS Super Fund A/C. The selling stockholder
is director of Synman Nominees Pty Ltd.
|
|
|
(133)
|
Of
these shares, 201 shares are held by the selling stockholder as trustee for Award Saver A/C.
|
|
|
(134)
|
Of
these shares, 13,398 shares are held by the selling stockholders as trustees for Lawrenson J & R S/Fund A/C.
|
|
|
(135)
|
Of
these shares, 3,600 shares are held by Kovron Pty Ltd as trustee for J M Creagh Super Fund A/C, and 2,527 shares are held
by Trial Developments Pty Ltd. The selling stockholders are directors of Kovron Pty Ltd and Trial Developments Pty Ltd.
|
|
|
(136)
|
Of
these shares, 124 shares are held by Salora Station Pty Ltd as trustee for Highbray Absolute Entitl AC. The selling shareholders
are directors of Salora Station Pty Ltd.
|
|
|
(137)
|
Of
these shares, 2,700 shares are held by Wangara Proprietors Pty Ltd. The selling stockholder is director of Wangara Proprietors
Pty Ltd.
|
|
|
(138)
|
Of
these shares, 6,605 shares are held by Pfitzner Super Holdings Pty Ltd as trustee for Pfitzner Wangara Super Fund. The selling
stockholder is director of Pfitzner Super Holdings Pty Ltd.
|
|
|
(139)
|
Held
by JJAM4 Pty Ltd as trustee for Papadimitriou Family Trust. The selling stockholders are directors of JJAM4 Pty Ltd.
|
|
|
(140)
|
Of
these shares, 8,399 shares are held by Admin Nominees Pty Ltd as trustee for Lovett Family A/C. The selling stockholders are
directors of Admin Nominees Pty Ltd.
|
|
|
(141)
|
Held
by the selling stockholder as trustee for the J Hansen Family A/C.
|
|
|
(142)
|
Of
these shares, 1,985 shares are held by Campbell Marketing Pty Ltd as trustee for The John Campbell S/F A/C. The selling stockholder
is the director of Campbell Marketing Pty Ltd.
|
|
|
(143)
|
Held
by AJAF Pty Ltd as trustee for the AJAF Superfund. The selling stockholders are directors of AJAF Pty Ltd.
|
|
|
(144)
|
Of
these shares, 1,374 shares are held by the selling stockholders as trustees for Adnams Family S/Fund A/C.
|
|
|
(145)
|
Of
these shares, 5,000 shares are held directly by the selling stockholders and 300 shares are held by the selling stockholders
as trustees for Hansen Superannuation Fund.
|
(146)
|
Of
these shares, 431 shares are held directly and 469 shares are held by Royall Investments Pty Ltd as trustee for Royall Super
Fund A/C. The selling stockholder is director of Royall Investments Pty Ltd.
|
|
|
(147)
|
Of
these shares, 1,079 shares are held by the selling stockholders as trustees of Fry Super Fund A/C.
|
|
|
(148)
|
Of
these shares, 1,474 shares are held by the selling stockholder as trustee for Thwaites Family S/F A/C.
|
|
|
(149)
|
Of
these shares, 3,950 shares are held by the selling stockholders as trustees for John & Goi’s Super Fund A/C.
|
|
|
(150)
|
Of
these shares, 10,909 shares are held by POTB Pty Ltd as trustee for Muda Jake Trust and 13,200 shares are held by Super Keeper
Pty Ltd as trustee for RestNPlay SMSF. The selling stockholders are directors of POTB Pty Ltd and Super Keeper Pty Ltd, and
beneficiaries of Muda Jake Trust and RestNPlay SMSF.
|
|
|
(151)
|
Held
by the selling stockholders as trustees for The Lovett Family Super Fund.
|
|
|
(152)
|
Of
these shares, 1,470 shares are held by the selling stockholder as trustee for Kirzner Family A/C, and 1,053 shares are held
by Staple Elements Pty Ltd as trustee for Kirzner Family Trust. The selling stockholder is the beneficiary of Kirzner Family
Trust.
|
|
|
(153)
|
Of
these shares, 150 shares are held by the selling stockholder as trustee for Kristian Gowan A/C.
|
|
|
(154)
|
Of
these shares, 3,368 shares are held by the selling stockholders as trustees for Keith Vuichoud Pens Fund A/C.
|
|
|
(155)
|
Held
by McBride SMSF Company Pty Ltd. The selling stockholder is director of McBride SMSF Company Pty Ltd.
|
|
|
(156)
|
Held
by KAC Investment Pty Ltd as trustee for KAC Superannuation Fund. The selling stockholder is director of KAC Investment Pty
Ltd.
|
|
|
(157)
|
Of
these shares, 13,526 shares are held by Nexcar Pty Ltd as trustee for Nexcar Investment AC, and 11,266 shares are held by
Timmatt Pty Ltd as trustee for Stuckey Superannuation Fund AC. The selling stockholder is director of Nexcar Pty Ltd and Timmatt
Pty Ltd.
|
|
|
(158)
|
Held
by Kaizen Superannuation Fund Pty Ltd as trustee for Kaizen Superannuation Fund. The selling stockholders are directors of
Kaizen Superannuation Fund Pty Ltd.
|
|
|
(159)
|
Of
these shares, 2,000 shares are held by the selling stockholders as trustee for Hightide Trust.
|
|
|
(160)
|
Of
these shares, 2,009 shares are held directly, and 1,001 shares are held by the selling stockholder as trustee for Kerrie Louise
Grayson A/C.
|
(161)
|
Of
these shares, 1,358 shares are held directly, 8,046 shares are held by Kevin Howard Crane Hire Pty Ltd as trustee for K &
M Howard S/Fund A/C, 2,027 shares are held by Kevin Howard Investments Pty Ltd, and 2,187 shares are held by Howard K&M
Crane Hire Pty Ltd as trustee for K&M Howard Super. The selling stockholder is director of Kevin Howard Crane Hire Pty
Ltd, Kevin Howard Investments Pty Ltd and Howard K&M Crane Hire Pty Ltd.
|
|
|
(162)
|
Of
these shares, 411 shares are held directly, and 425 shares are held by the selling stockholder as trustee for Riley Super
Fund A/C.
|
|
|
(163)
|
Of
these shares, 1,098 shares are held by Vardy Superannuation Pty Ltd as trustee for Vardy Super Fund A/C. The selling stockholders
are directors of Vardy Superannuation Pty Ltd.
|
|
|
(164)
|
Of
these shares, 84,645 shares are held by the selling stockholder as trustee for Dr L Prasad Super Fund A/C.
|
|
|
(165)
|
Of
these shares, 2,295 shares are held by Pollard Superannuation Pty Ltd as trustee for Pollard Super Fund A/C. The selling stockholder
is director of Pollard Superannuation Pty Ltd.
|
|
|
(166)
|
Of
these shares, 8,000 shares are held by the selling stockholders as trustee for the Kirby Family Superannuation Fund.
|
|
|
(167)
|
Of
these shares, 727 shares are held by the selling stockholder as trustee for Precision Greenfields S/F AC, 430 shares are held
by Precision Greenfields Pty Ltd, and 403 shares are held by the selling stockholder as trustee for Stafford Investment A/C.
The selling stockholder is the director of Precision Greenfields Pty Ltd.
|
|
|
(168)
|
Of
these shares, 3,593 shares are held by Frosti Super Pty Ltd as trustee for MaggieArnold Superannuation Fund. The selling shareholders
are directors of Frosti Super Pty Ltd.
|
|
|
(169)
|
Of
these shares, 1,733 shares are held by Triple 8 Ventures Pty Ltd as trustee for L Porteous Family A/C. The selling stockholder
is director of Triple 8 Ventures Pty Ltd.
|
|
|
(170)
|
Of
these shares, 385 shares are held by LMC Superannuation Pty Ltd as trustee for LM Closter Super Fund A/C and 242 shares are
held by the selling stockholder as trustee for R Closter Fam Disc No 2 A/C. The selling stockholder is director of LMC Superannuation
Pty Ltd.
|
|
|
(171)
|
Held
by the selling stockholders as trustees for the Superannuation Fund.
|
|
|
(172)
|
Held
by Eliza Super (VIC) Pty Ltd as trustee for Wanattha Superfund. The selling stockholders are directors of Eliza Super (VIC)
Pty Ltd.
|
|
|
(173)
|
Of
these shares, 306 shares are held directly, and 1,019 shares are held by the selling stockholders as trustees for Warren Family
Super Fund A/C.
|
|
|
(174)
|
Of
these shares, 10,049 shares are held by the selling stockholders as trustees for Koch Super Fund A/C.
|
(175)
|
Of
these shares, 1,378 shares are held by Sherrin Pty Ltd as trustee for J & M Livingston Super A/C. The selling stockholder
is director of Sherrin Pty Ltd.
|
|
|
(176)
|
Of
these shares, 2,014 shares are held by McIntyre Executive Pty Limited as trustee for McIntyre Executive S/F A/C. The selling
stockholders are directors of McIntyre Executive Pty Limited.
|
|
|
(177)
|
Of
these shares, 2,419 shares are held by Phillips Nominees Pty Ltd as trustee for Phillips Family A/C. The selling stockholders
are directors of Phillips Nominees Pty Ltd.
|
|
|
(178)
|
Of
these shares, 5,000 shares are held by the selling stockholders as trustees for The Mark Trott Family Trust.
|
|
|
(179)
|
Of
these shares, 477 shares are held by the selling stockholders as trustees for The Freedom Super Fund A/C.
|
|
|
(180)
|
Of
these shares, 109 shares are held by the selling stockholder as trustee for the Miles Family Super Fund Pty Ltd.
|
|
|
(181)
|
Of
these shares, 1,525 shares are held by MSC Enterprises (AUST) Pty Ltd. The selling stockholder is director of MSC Enterprises
(AUST) Pty Ltd.
|
|
|
(182)
|
Held
by the selling stockholders as trustees for Di Muzio Superfund.
|
|
|
(183)
|
Of
these shares, 1,990 shares are held by Investment Vision Pty Ltd as trustee for Vision One A/C, and 1,416 shares are held
by Investment Vision Pty Ltd as trustee for Maurice Dover Super A/C. The selling stockholder is director of Investment Vision
Pty Ltd.
|
|
|
(184)
|
Of
these shares, 1,472 shares are held by Twigg Investments Pty Ltd as trustee for Twigg Investment A/C. The selling stockholder
is director of Twigg Investments Pty Ltd.
|
|
|
(185)
|
Of
these shares, 5,001 shares are held by Tasman (VIC) Pty Ltd as trustee for Hooper Super Fund A/C, 2,932 shares are held by
Fifth Glenmar Pty Ltd as trustee for Fifth Glenmar Property A/C. The selling stockholders are directors of Tasman (VIC) Pty
Ltd and Fifth Glenmar Pty Ltd.
|
|
|
(186)
|
Of
these shares, 9,175 shares are held by Nickbah Pty Ltd as trustee for Hamilah Super Fund, 4,676 shares are held by Nickbah
Pty Ltd as trustee for M S Bigg Business A/C, and 4,485 shares are held by Hamilah Pty Ltd as trustee for The Hamilah Super
Fund A/C. The selling stockholders are directors of Nickbah Pty Ltd and Hamilah Pty Ltd.
|
|
|
(187)
|
Of
these shares, 3,035 shares are held by Heartbeat Communications Pty Ltd as trustee for Heartbeat Comm S/Fund A/C. The selling
stockholders are directors of Heartbeat Communications Pty Ltd.
|
|
|
(188)
|
Of
these shares, 3,081 shares are held by Newquay Investments Pty Ltd as trustee for Newquay Super Fund A/C, and 462 shares are
held by Newquay Investments Pty Ltd as trustee for Michael Keating Family A/C. The selling stockholders are directors of Newquay
Investments Pty Ltd.
|
|
|
(189)
|
Of
these shares, 3,364 are held by the selling stockholder as trustee for The M H R A/C and 10,391 are held by the selling stockholder
as trustee for The M H R Account.
|
|
|
(190)
|
Held
by Rogers Superannuation Pty Ltd as trustee for Rogers Superannuation Account. The selling stockholders are directors of Rogers
Superannuation Pty Ltd.
|
(191)
|
Held
by Michael John Drapac Super Pty Ltd as trustee for MJD Superannuation Fund. The selling stockholder is director of Michael
John Drapac Super Pty Ltd.
|
|
|
(192)
|
Of
these shares, 2,010 shares are held directly by the selling stockholder, and 502 shares are held by the selling stockholder
as trustee for McCann SMSF Pty Ltd.
|
|
|
(193)
|
Held
by Lyons McMahon Super Pty Ltd as trustee for M McMahon Superannuation Fund. The selling stockholder is a director of Lyons
McMahon Super Pty Ltd.
|
|
|
(194)
|
Of
these shares, 3,114 shares are held by the selling stockholders as trustees for Minichiello Super Fund A/C.
|
|
|
(195)
|
Held
by Shivohm Pty Ltd as trustee for Mody Unit Trust. The selling stockholder is director of Shivohm Pty Ltd.
|
|
|
(196)
|
Of
these shares, 295 shares are held by N & R Allsopp Pty Ltd as trustee for Allsopp Family A/C, 908 shares are held by the
selling stockholders as trustees for Neil & Rhonda Allsopp SF A/C. The selling stockholders are directors of N & R
Allsopp Pty Ltd.
|
|
|
(197)
|
Of
these shares, 1,053 shares are held by the selling stockholder as trustee for The N & K Cooper Future Fund.
|
|
|
(198)
|
Of
these shares, 3,523 shares are held by NV Estates Pty Ltd as trustee for Ibbott Family Superannuation Fund and 2,628 shares
are held the selling stockholder as trustee for the Neil Gerald Ibbott Testamentary Trust. The selling stockholder is director
of NV Estates Pty Ltd.
|
|
|
(199)
|
Of
these shares, 1,500 shares are held by Ball Superannuation Fund Pty Ltd as trustee for Ball Superannuation Fund, and 1,023
shares are held by the selling stockholders as trustee for Ball Family Trust. The selling stockholders are directors of Ball
Superannuation Fund Pty Ltd.
|
|
|
(200)
|
Of
these shares, 3,113 shares are held by Kambell Pty Ltd as trustee for Grant Family Super Fund A/C, 459 shares are held by
Kambell Pty Ltd as trustee for Grant Family A/C, and 421 shares are held by Kambell Pty Ltd. The selling stockholder is director
of Kambell Pty Ltd.
|
|
|
(201)
|
Held
by Labona Pty Ltd as trustee for The Nicholas Family Trust. The selling stockholder is director of Labona Pty Ltd.
|
|
|
(202)
|
Of
these shares, 242 shares are held by R M Investments Pty Ltd as trustee for NRM Unit Account, and 202 shares are held by Mabeti
Pty Limited as trustee for Superannuation Fund A/C. The selling stockholder is director of R M Investments Pty Ltd and Mabeti
Pty Limited.
|
|
|
(203)
|
Held
by Cape Beach Pty Limited. The selling stockholder is a director of Cape Beach Pty Limited.
|
|
|
(204)
|
Held
by JRG Property Trust & Schutte Family Trust as trustee for the Shelmic Property Unit Trust. The selling stockholder is
director of JRG Property Trust & Schutte Family Trust.
|
|
|
(205)
|
Of
these shares, 1,377 shares are held by King Cosmos Investments Limited. The selling stockholder is director of King Cosmos
Investments Limited.
|
(206)
|
Held
by the selling stockholders as trustees for Bernau Superannuation Fund.
|
|
|
(207)
|
Held
by the selling stockholders as trustees for McIntosh Superannuation Fund.
|
|
|
(208)
|
Of
these shares, 6,340 shares are held by Kew Directors Pty Ltd as trustee for Kew Dirs S/F-Portfolio A/C. The selling stockholders
are directors of Kew Directors Pty Ltd.
|
|
|
(209)
|
Of
these shares, 10,000 shares are held by Horizon NT Pty Ltd as trustee for The Horizon Family Trust. The selling stockholder
is director of Horizon NT Pty Ltd.
|
|
|
(210)
|
Held
by the selling stockholders as trustees for the Hills Superannuation Fund.
|
|
|
(211)
|
Of
these shares, 2,805 shares are held by Optionall Pty Ltd as trustee for Christopher Ruys A/C. The selling stockholders are
directors of Optionall Pty Ltd.
|
|
|
(212)
|
Of
these shares, 997 shares are held by GOF Nominees Pty Limited, and 559 shares are held by P & K Taylor Superannuation
Fund Pty Ltd. The selling stockholder is director of GOF Nominees Pty Limited and P & K Taylor Superannuation Fund Pty
Ltd.
|
|
|
(213)
|
Of
these shares, 198 shares are held by the selling stockholders as trustees for Tosin S/F A/C.
|
|
|
(214)
|
Held
by the selling stockholders as trustees for Hearman Superfund A/C.
|
|
|
(215)
|
Held
by Candid Action Pty Ltd, of which the selling stockholder is a director.
|
|
|
(216)
|
Of
these shares, 2,068 shares are held by Jupek Pty Ltd as trustee for The Gowan Super Fund A/C. The selling stockholders are
directors of Jupek Pty Ltd.
|
|
|
(217)
|
Of
these shares, 2,116 shares are held by SMSF 4U Pty Ltd as trustee for P J Dunn Superfund No2 A/C. The selling stockholder
is director of SMSF 4U Pty Ltd.
|
|
|
(218)
|
Of
these shares, 4,166 shares are held by Salziela Future Fund Pty Ltd as trustee for Salziela Future Fund. The selling stockholder
is director of Salziela Future Fund Pty Ltd.
|
|
|
(219)
|
Of
these shares, 2,602 shares are held by Nonnemacher Enterprises Pty Ltd as trustee for Nonnemacher S/F A/C. The selling stockholders
are directors of Nonnemacher Enterprises Pty Ltd.
|
|
|
(220)
|
Of
these shares, 7,873 are held by Shetech Enterprises. The selling stockholder is a director of Shetech Enterprises.
|
(221)
|
Of
these shares, 230 shares are held by the selling stockholders as trustees for Mark Family Super Fund A/C.
|
|
|
(222)
|
Of
these shares, 2,000 shares are held by Peter Moore Pty Ltd as trustee for Peter Moore Super Fund A/C. The selling stockholder
is director of Peter Moore Pty Ltd.
|
|
|
(223)
|
Of
these shares, 1,237 shares are held by the selling stockholders as trustees for Hearman Family Trust.
|
|
|
(224)
|
Held
by Eliryem Pty Ltd, of which the selling stockholders are directors.
|
|
|
(225)
|
Of
these shares, 128 shares are held by the selling stockholders as trustees for the Chatterjee Super Fund A/C.
|
|
|
(226)
|
Of
these shares, 4,036 shares are held by R & H Woodrow Pty Ltd as trustee for the Woodrow Super Fund A/C. The selling stockholders
are directors of R & H Woodrow Pty Ltd.
|
|
|
(227)
|
Of
these shares, 419 shares are held by R & J Pty Ltd as trustee for Ramani Family A/C. The selling stockholders are directors
of R & J Pty Ltd.
|
|
|
(228)
|
Of
these shares, 1,400 shares are held by the selling stockholders as trustees for the Rasiah Superannuation Fund No 2.
|
|
|
(229)
|
Held
by the selling stockholders as trustees for Westlake Superannuation Fund.
|
|
|
(230)
|
Of
these shares, 124 shares are held by the selling stockholders as trustees for Varma Super Fund A/C.
|
|
|
(231)
|
Of
these shares, 439 shares are held by Ray Neilsen Super Pty Ltd as trustee for the Neilsen Gravel Group S/F A/C. The selling
stockholder is director of Ray Neilson Super Pty Ltd.
|
|
|
(232)
|
Of
these shares, 1,503 shares are held by Praklark Pty Ltd. The selling stockholder is director of Praklark Pty Ltd.
|
|
|
(233)
|
Of
these shares, 449 shares are held by R A B Investments Pty Ltd and 17,909 shares are held by the selling stockholders as trustees
for RAB Investments Pty Ltd A/C. The selling stockholders are directors of R A B Investments Pty Ltd.
|
|
|
(234)
|
Of
these shares, 2,000 shares are held by Handibeau Pty Limited as trustee for the Prendergast Super Fund A/C. The selling stockholders
are directors of Handibeau Pty Limited.
|
|
|
(235)
|
Of
these shares, 4,043 shares are held by the selling stockholders as trustees for Big Boss Investments A/C, 3,014 shares are
held by the selling stockholders as trustees for Broadbill Super Fund A/C, and 2,793 shares are held by Big Boss Investments
Pty Ltd. The selling stockholders are directors of Big Boss Investments Pty Ltd.
|
(236)
|
Of
these shares, 1,536 shares are held by the selling stockholders as trustees for Pruyn Family A/C.
|
|
|
(237)
|
Held
by the selling stockholders as trustees for Youil Superannuation Fund.
|
|
|
(238)
|
Held
by the selling stockholder as trustee for Anthony Family Super Fund.
|
|
|
(239)
|
Of
these shares, 5,000 shares are held by Lasame Pty Ltd as trustee for the R & F Super Fund. The selling stockholder is
director of Lasame Pty Ltd.
|
|
|
(240)
|
Of
these shares, 15,628 shares are held by Ascendant SC Pty Ltd as trustee for Ascendant SC A/C and 2,131 shares are held by
Bageton Nominees Pty Ltd as trustee for Kucharski Family A/C. The selling stockholder is director of Ascendant SC Pty Ltd
and Bageton Nominees Pty Ltd.
|
|
|
(241)
|
Held
by the selling stockholders as trustees for The Namllu Super Fund A/C.
|
|
|
(242)
|
Of
these shares, 2,132 shares are owned by selling stockholders as trustees for the Romaral Super Fund A/C.
|
|
|
(243)
|
Of
these shares, 7,000 shares are held by Vicroy Pty Ltd as trustee for the Benson Family A/C. The selling stockholder is director
of Vicroy Pty Ltd.
|
|
|
(244)
|
Of
these shares, 4,700 shares are held by RustySteve Super Fund Pty Ltd. The selling stockholders are directors of RustySteve
Super Fund Pty Ltd.
|
|
|
(245)
|
Of
these shares, 2,523 shares are held by Bigmor Pty Ltd as trustee for the Bigmor Super Fund A/C. The selling stockholders are
directors of Bigmor Pty Ltd.
|
|
|
(246)
|
Of
these shares, 13,778 shares are held by Gant Investments Pty Ltd, 37,112 shares are held by Gant Investments Pty Ltd as trustee
for Gant Investments A/C, and 10,000 shares are held by Gant Investments Pty Ltd as trustee for S L Gant Superannuation Fund.
The selling stockholder is director of Gant Investments Pty Ltd.
|
|
|
(247)
|
Of
these shares, 6,970 shares are held by Shayjo Superannuation Pty Ltd as trustee for The Shayjo Superannuation Fund. The selling
stockholder is director of Shayjo Superannuation Pty Ltd.
|
|
|
(248)
|
Held
by the selling stockholders as trustees for Nugara Family Superannuation Fund.
|
|
|
(249)
|
Of
these shares, 3,223 shares are held by the selling stockholder as trustee for Forzas1 Superannuation A/C, 1,536 are held directly
by the selling stockholder and 4,200 are held by Slforza Pty Ltd as trustee for Forza1 Family Trust. The selling stockholder
is a director of Slforza Pty Ltd.
|
|
|
(250)
|
Of
these shares, 596 shares are held by Sapphire Beginnings Pty Ltd. The selling stockholder is a director of Sapphire Beginnings
Pty Ltd.
|
(251)
|
Of
these shares, 171 shares are held by Ellon Nominees Pty Ltd as trustee for Ellon Family A/C. The selling stockholder is director
of Ellon Nominees Pty Ltd.
|
|
|
(252)
|
Of
these shares, 1,870 shares are held by Coorparoo Health and Beauty Pty Limited as trustee for I & S Young Family A/C.
The selling stockholder is director of Coorparoo Health and Beauty Pty Limited.
|
|
|
(253)
|
Of
these shares, 1,199 shares are held by the selling stockholder as trustee for Sheridan Family A/C.
|
|
|
(254)
|
Of
these shares, 477 shares are held directly, 2,362 shares are held by the selling stockholders as trustees for Burns Family
Super Fund A/C.
|
|
|
(255)
|
Held
by the selling stockholders as trustees for the Cox Super Fund A/C.
|
|
|
(256)
|
Held
by the selling stockholders as trustees for the Greenham Family Superannuation Fund.
|
|
|
(257)
|
Of
these shares, 1,715 shares are held by Avon Rise Pty Ltd as trustee for Sixth Gypsy P/L S/Fund A/C. The selling stockholders
are directors of Avon Rise Pty Ltd.
|
|
|
(258)
|
Of
these shares, 2,135 shares are held by the selling stockholders as trustees for Dobrzynski Family S/F A/C.
|
|
|
(259)
|
Of
these shares, 311 shares are held by the selling stockholders as trustees for Sirius Super Fund A/C.
|
|
|
(260)
|
Of
these shares, 3,000 shares are held by the selling stockholder as trustee for Suzanne Jones Super Fund.
|
|
|
(261)
|
Of
these shares, 6,000 shares are held by the selling stockholders as trustees for Spearhead Super Fund.
|
|
|
(262)
|
Held
by the selling stockholders as trustees for T & S Carroll Super Fund A/C.
|
|
|
(263)
|
Of
these shares, 3,430 shares are held by Roth Consulting Group Pty Ltd as trustees for Roth Consulting S/F A/C. The selling
stockholders are directors of Roth Consulting Group Pty Ltd.
|
|
|
(264)
|
Held
by the selling stockholder as trustee for T Rasiah Investment Trust.
|
|
|
(265)
|
Of
these shares, 401 shares are held by the selling stockholders as trustees for Ashcroft Super Fund A/C.
|
(266)
|
Of
these shares, 736 shares are held by the selling stockholders as trustees for Horgan Family S/F A/C.
|
|
|
(267)
|
Held
by Donnybrook Traders Pty Ltd, of which the selling stockholders are directors.
|
|
|
(268)
|
Held
by Custom Print Consulting, of which the selling stockholder is a director.
|
|
|
(269)
|
Of
these shares, 2,143 shares are held by the selling stockholders as trustees for Timbel Family A/C.
|
|
|
(270)
|
Of
these shares, 8,666 shares are held by First Farley Pty Ltd as trustee for The Timar Superannuation Fund. The selling stockholders
are directors of First Farley Pty Ltd.
|
|
|
(271)
|
Of
these shares, 1,015 shares are held directly, and 2,564 shares are held by Desgo Pty Ltd as trustee for Oliver Super Fund
A/C. The selling stockholder is director of Desgo Pty Ltd.
|
|
|
(272)
|
Held
by Onsight Ascent Pty Ltd as trustee for The Onsight Trust. The selling stockholders are directors of Onsight Ascent Pty Ltd.
|
|
|
(273)
|
Of
these shares, 204 shares are held by the selling stockholder as trustee for Tina Dion Super Fund A/C.
|
|
|
(274)
|
Of
these shares, 1,577 shares are held by Adelaide East Pty Limited as trustee for Tony Havig Family A/C, and 1,403 shares are
held by Liverpool Road Investments Pty Ltd as trustee for Tony Havig Super Fund A/C. The selling stockholder is director of
Adelaide East Pty Limited and Liverpool Road Investments Pty Ltd.
|
|
|
(275)
|
Of
these shares, 125 shares are held by the selling stockholders jointly with Jordan Murphy Pty Ltd. The selling stockholders
are directors of Jordan Murphy Pty Ltd.
|
|
|
(276)
|
Of
these shares, 246 shares are held by Tourquet Pty Ltd as trustee for Hansens AZDF Synd Unit A/C. The selling stockholders
are directors of Tourquet Pty Ltd.
|
|
|
(277)
|
Of
these shares, 3,941 shares are held by the selling stockholders as trustees for Bell Family Super Fund A/C.
|
|
|
(278)
|
Of
these shares, 2,000 shares are held by Dunlop Miller Investments Pty Ltd as trustee for The Creagh Investment Trust. The selling
stockholder is director of Dunlop Miller Investments Pty Ltd.
|
|
|
(279)
|
Held
by the selling stockholder as trustee for Creagh V3 Super Fund.
|
|
|
(280)
|
Of
these shares, 225 shares are held by the selling stockholders as trustees for MPC Superannuation Fund A/C.
|
|
|
(281)
|
Held
by Wazzandee Pty Ltd as trustee for Warren Slater & Dee Slater Superannuation Fund. The selling stockholders are directors
of Wazzandee Pty Ltd.
|
|
|
(282)
|
Of
these shares, 4,000 shares are held by WFS Super Pty Ltd as trustee for the WFS Future Super Fund. The selling stockholder
is director of WFS Super Pty Ltd.
|
|
|
(283)
|
Held
by Roger Youil and William Maile as trustees for the TRRW Trust Fund, of which the selling stockholders are beneficiaries.
|
|
|
(284)
|
Of
these shares, 225 shares are held by the selling stockholders as trustees for Taylor Super Fund A/C.
|
LEGAL
MATTERS
The
validity of the securities offered by this prospectus was passed upon for us by Legal & Compliance, LLC, 330 Clematis Street,
Suite 217, West Palm Beach, Florida 33401.
EXPERTS
Our
consolidated balance sheets as of December 31, 2016 and 2015 and the related consolidated statement of operations, changes in
stockholders’ equity and cash flows for the years ended December 31, 2016 and 2015 included in this prospectus have been
audited by Rose, Snyder & Jacobs LLP, independent registered public accounting firm, as indicated in their report with respect
thereto, and have been so included in reliance upon the report of such firm given on their authority as experts in accounting
and auditing.
DISCLOSURE
OF COMMISSION’S POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Our
directors and officers are indemnified as provided by Florida law, our amended and restated articles of incorporation, as amended,
and our amended and restated bylaws. We have agreed to indemnify each of our directors and certain officers against certain liabilities,
including liabilities under the Securities Act. Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to our directors, officers and controlling persons pursuant to the provisions described above, or otherwise, we have
been advised that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than our payment
of expenses incurred or paid by our director, officer or controlling person in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless
in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.
WHERE
YOU CAN FIND ADDITIONAL INFORMATION
We
have filed with the SEC the registration statement on Form S-1 under the Securities Act for the securities offered by this prospectus.
This prospectus, which is a part of the registration statement, does not contain all of the information in the registration statement
and the exhibits filed with it, portions of which have been omitted as permitted by SEC rules and regulations. For further information
concerning us and the securities offered by this prospectus, we refer to the registration statement and to the exhibits filed
with it. Statements contained in this prospectus as to the content of any contract or other document referred to are not necessarily
complete. In each instance, we refer you to the copy of the contracts and/or other documents filed as exhibits to the registration
statement.
The
registration statement on Form S-1, of which this prospectus forms a part, including exhibits, is available at the SEC’s
website at
http://www.sec.gov
. You may also read and copy any document we file with, or furnish to, the SEC at its public
reference facilities:
|
Public
Reference Room Office
|
|
100
F Street, N.E.
|
|
Room
1580
|
|
Washington,
D.C. 20549
|
You
may also obtain copies of the documents at prescribed rates by writing to the Public Reference Section of the SEC at 100 F Street,
N.E., Room 1580, Washington, D.C. 20549. Callers in the United States can also call (202) 551-8090 for further information on
the operations of the public reference facilities.
INDEX
TO FINANCIAL STATEMENTS
IEG
HOLDINGS CORPORATION
|
Page
|
|
|
Report
of Independent Registered Public Accounting Firm
|
F-2
|
|
|
Consolidated
Balance Sheets as of December 31, 2016 and 2015
|
F-3
|
|
|
Consolidated
Statements of Operations for the Years Ended December 31, 2016 and 2015
|
F-4
|
|
|
Consolidated
Statements of Stockholders’ Equity for the Years Ended December 31, 2016 and 2015
|
F-5
|
|
|
Consolidated
Statements of Cash Flows for the Years Ended December 31, 2016 and 2015
|
F-6
|
|
|
Notes
to Consolidated Financial Statements
|
F-7
|
|
|
Condensed
Consolidated Balance Sheets as of June 30, 2017 (unaudited) and December 31, 2016
|
F-21
|
|
|
Condensed
Consolidated Unaudited Statements of Operations for the Three and Six Months Ended June 30 , 2017 and 2016
|
F-22
|
|
|
Condensed
Consolidated Unaudited Statements of Stockholders’ Equity for the Period from January 1, 2016 through June 30,
2017
|
F-23
|
|
|
Condensed
Consolidated Unaudited Statements of Cash Flows for the Six Months Ended June 30 , 2017 and 2016
|
F-24
|
|
|
Notes
to Condensed Consolidated Unaudited Financial Statements
|
F-25
|
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To
the Board of Directors and
Shareholders
of IEG Holdings Corporation:
We
have audited the accompanying consolidated balance sheets of IEG Holdings Corporation and Subsidiaries as of December 31, 2016
and 2015, and the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years
in the two-year period ended December 31, 2016. IEG Holdings Corporation’s management is responsible for these consolidated
financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
We
conducted our audits in accordance with the standards established by 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 consolidated financial statements referred to above present fairly, in all material respects, the consolidated
financial position of IEG Holdings Corporation and Subsidiaries as of December 31, 2016 and 2015, and the consolidated results
of their operations and their cash flows for each of the years in the two-year period ended December 31, 2016, in conformity with
accounting principles generally accepted in the United States of America.
/s/
Rose, Snyder & Jacobs LLP
Rose,
Snyder & Jacobs LLP
Encino,
California
March
6, 2017
15821
VENTURA BOULEVARD, SUITE 490, ENCINO, CALIFORNIA 91436 PHONE: (818) 461 - 0600 ● FAX: (818) 461 – 0610
IEG
HOLDINGS CORPORATION
CONSOLIDATED
BALANCE SHEETS
FOR
THE YEARS ENDED
DECEMBER 31, 2016 AND 2015
|
|
December
31, 2016
|
|
|
December
31, 2015
|
|
ASSETS
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$
|
322,441
|
|
|
$
|
485,559
|
|
Loans receivable,
net, note 2
|
|
|
6,374,908
|
|
|
|
7,124,702
|
|
Other receivables
|
|
|
84,851
|
|
|
|
76,262
|
|
Prepaid expenses
|
|
|
12,955
|
|
|
|
7,276
|
|
Property and equipment,
net, note 3
|
|
|
19,322
|
|
|
|
28,511
|
|
Security
deposits
|
|
|
7,470
|
|
|
|
35,839
|
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$
|
6,821,947
|
|
|
$
|
7,758,149
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
Accounts payable
and accrued expenses
|
|
$
|
1,060
|
|
|
$
|
96,441
|
|
Deferred
rent
|
|
|
-
|
|
|
|
11,522
|
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES
|
|
|
1,060
|
|
|
|
107,963
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES, note 9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock,
$0.001 par value; 50,000,000 shares authorized, 0 and 1,160,000 shares issued and outstanding at December 31, 2016 and December
31, 2015 respectively, note 6
|
|
|
-
|
|
|
|
1,160
|
|
Common stock, $0.001
par value; 300,000,000 shares authorized, 9,714,186 and 2,887,428 shares issued and outstanding at December 31, 2016 and December
31, 2015 respectively, note 6
|
|
|
2,233,182
|
|
|
|
2,165,405
|
|
Additional paid-in
capital
|
|
|
29,698,025
|
|
|
|
26,025,071
|
|
Prepaid preferred
share redemption
|
|
|
-
|
|
|
|
(160,000
|
)
|
Accumulated
deficit
|
|
|
(25,110,319
|
)
|
|
|
(20,381,450
|
)
|
|
|
|
|
|
|
|
|
|
TOTAL
STOCKHOLDERS’ EQUITY
|
|
|
6,820,887
|
|
|
|
7,650,186
|
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
$
|
6,821,947
|
|
|
$
|
7,758,149
|
|
See
report of independent registered public accounting firm and notes to consolidated financial statements.
IEG
HOLDINGS CORPORATION
CONSOLIDATED
STATEMENTS OF OPERATIONS
FOR
THE YEARS ENDED
DECEMBER 31, 2016 AND 2015
|
|
2016
|
|
|
2015
|
|
REVENUES
|
|
|
|
|
|
|
Interest
revenue
|
|
$
|
2,086,976
|
|
|
$
|
1,789,701
|
|
Other
revenue
|
|
|
48,070
|
|
|
|
45,464
|
|
|
|
|
|
|
|
|
|
|
TOTAL
REVENUES
|
|
|
2,135,046
|
|
|
|
1,835,165
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
Salaries and compensation
|
|
|
1,592,990
|
|
|
|
2,126,243
|
|
Other operating expenses
|
|
|
1,561,045
|
|
|
|
1,399,157
|
|
Consulting
|
|
|
1,154,465
|
|
|
|
1,013,690
|
|
Provision for credit
losses
|
|
|
1,865,362
|
|
|
|
1,134,518
|
|
Advertising
|
|
|
373,350
|
|
|
|
950,905
|
|
Rent
|
|
|
178,678
|
|
|
|
244,621
|
|
Travel, meals and
entertainment
|
|
|
141,686
|
|
|
|
129,351
|
|
Depreciation
and amortization
|
|
|
8,618
|
|
|
|
14,124
|
|
|
|
|
|
|
|
|
|
|
TOTAL
OPERATING EXPENSES
|
|
|
6,876,194
|
|
|
|
7,012,609
|
|
|
|
|
|
|
|
|
|
|
LOSS
FROM OPERATIONS
|
|
|
(4,741,147
|
)
|
|
|
(5,177,444
|
)
|
|
|
|
|
|
|
|
|
|
OTHER INCOME (EXPENSE)
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
-
|
|
|
|
(527,921
|
)
|
Miscellaneous
income (expense)
|
|
|
12,278
|
|
|
|
7,167
|
|
|
|
|
|
|
|
|
|
|
TOTAL
OTHER INCOME (EXPENSE)
|
|
|
12,278
|
|
|
|
(520,754
|
)
|
|
|
|
|
|
|
|
|
|
NET
LOSS
|
|
$
|
(4,728,869
|
)
|
|
$
|
(5,698,198
|
)
|
|
|
|
|
|
|
|
|
|
Dividends on preferred shares
|
|
|
(35,517
|
)
|
|
|
(311,056
|
)
|
|
|
|
|
|
|
|
|
|
Net loss attributable to common stockholders
|
|
|
(4,764,386
|
)
|
|
|
(6,009,254
|
)
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to common stock per share, basic and diluted
|
|
$
|
(0.60
|
)
|
|
$
|
(2.52
|
)
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding, basic and diluted
|
|
|
7,918,922
|
|
|
|
2,381,257
|
|
See
report of independent registered public accounting firm and notes to consolidated financial statements.
IEG
HOLDINGS CORPORATION
CONSOLIDATED
STATEMENTS OF STOCKHOLDERS’ EQUITY
FOR
THE YEARS ENDED
DECEMBER 31, 2016 AND 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepaid
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
|
Preferred
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
Stock *
|
|
|
|
Series
A
|
|
|
|
Series
F
|
|
|
|
Series
G
|
|
|
|
Series
H
|
|
|
|
Paid-in
|
|
|
|
Share
|
|
|
|
Subscription
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
Shares
|
|
|
|
Amount
|
|
|
|
Shares
|
|
|
|
Amount
|
|
|
|
Shares
|
|
|
|
Amount
|
|
|
|
Shares
|
|
|
|
Amount
|
|
|
|
Shares
|
|
|
|
Amount
|
|
|
|
Capital
|
|
|
|
Redemption
|
|
|
|
Receivable
|
|
|
|
Deficit
|
|
|
|
Total
|
|
Balance, January
1, 2015
|
|
|
2,158,110
|
|
|
$
|
2,158,111
|
|
|
|
1,000,000
|
|
|
$
|
1,000
|
|
|
|
1,400,000
|
|
|
$
|
1,400
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
-
|
|
|
$
|
-
|
|
|
$
|
14,914,705
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
(14,683,252
|
)
|
|
$
|
2,391,964
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares at $10.00
|
|
|
432,608
|
|
|
|
4,326
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,321,760
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,326,086
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Preferred Shares
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
600,000
|
|
|
|
600
|
|
|
|
5,669,500
|
|
|
|
5,670
|
|
|
|
160,000
|
|
|
|
160
|
|
|
|
6,423,071
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
6,429,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares at $50.00
|
|
|
13,437
|
|
|
|
134
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
671,756
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
671,890
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of Preferred Shares to Common Shares
|
|
|
283,273
|
|
|
|
2,833
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(2,000,000
|
)
|
|
|
(2,000
|
)
|
|
|
(5,509,500
|
)
|
|
|
(5,510
|
)
|
|
|
(160,000
|
)
|
|
|
(160
|
)
|
|
|
4,836
|
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepaid Preferred Share Redemption
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(160,000
|
)
|
|
|
|
|
|
|
|
|
|
|
(160,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred Dividends
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(311,056
|
)
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
(311,056
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(5,698,198
|
)
|
|
|
(5,698,198
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December
31, 2015
|
|
|
2,887,428
|
|
|
$
|
2,165,405
|
|
|
|
1,000,000
|
|
|
$
|
1,000
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
160,000
|
|
|
$
|
160
|
|
|
|
-
|
|
|
$
|
-
|
|
|
$
|
26,025,071
|
|
|
$
|
(160,000
|
)
|
|
$
|
-
|
|
|
$
|
(20,381,450
|
)
|
|
$
|
7,650,186
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepaid Preferred Share Redemption
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(160,000
|
)
|
|
|
(160
|
)
|
|
|
|
|
|
|
|
|
|
|
(159,840
|
)
|
|
|
160,000
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares at $50.00
|
|
|
370
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,496
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Preferred Shares
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,071,000
|
|
|
|
3,071
|
|
|
|
3,067,929
|
|
|
|
|
|
|
|
(2,825,000
|
)
|
|
|
-
|
|
|
|
246,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of Preferred Shares to Common Shares
|
|
|
6,400,000
|
|
|
|
64,000
|
|
|
|
(1,000,000
|
)
|
|
|
(1,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(63,000
|
)
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares at $10.00
|
|
|
386,718
|
|
|
|
3,867
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,863,321
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,867,188
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Buyback of shares
|
|
|
(14,750
|
)
|
|
|
(148
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(208,952
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(209,099
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares for reverse split rounding
|
|
|
218
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares for consulting fee offset
|
|
|
5,000
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,495
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of Preferred Shares to Common Shares
|
|
|
49,200
|
|
|
|
49
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(246,000
|
)
|
|
|
(246
|
)
|
|
|
197
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred Share Cancellation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,825,000
|
)
|
|
|
(2,825
|
)
|
|
|
(2,822,175
|
)
|
|
|
|
|
|
|
2,825,000
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred Dividends
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(35,517
|
)
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
(35,517
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(4,728,869
|
)
|
|
|
(4,728,869
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December
31, 2016
|
|
|
9,714,186
|
|
|
$
|
2,233,182
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
29,698,025
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
(25,110,319
|
)
|
|
$
|
6,820,887
|
|
See
report of independent registered public accounting firm and notes to consolidated financial statements.
IEG
HOLDINGS CORPORATION
CONSOLIDATED
STATEMENTS OF CASH FLOWS
FOR
THE YEARS ENDED
DECEMBER 31, 2016 AND 2015
|
|
December
31, 2016
|
|
|
December
31, 2015
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(4,728,869
|
)
|
|
$
|
(5,698,198
|
)
|
Adjustments to reconcile
net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
Provision for credit
losses
|
|
|
1,865,362
|
|
|
|
1,134,518
|
|
Depreciation and
amortization
|
|
|
8,618
|
|
|
|
14,124
|
|
Amortization of loan
costs
|
|
|
-
|
|
|
|
77,781
|
|
Loss on disposal
of assets
|
|
|
571
|
|
|
|
12,582
|
|
Changes in assets
- (increase) decrease:
|
|
|
|
|
|
|
|
|
Other receivables
|
|
|
(8,589
|
)
|
|
|
(50,380
|
)
|
Prepaid expenses
|
|
|
(5,679
|
)
|
|
|
(7,276
|
)
|
Deposits
|
|
|
28,369
|
|
|
|
3,490
|
|
Changes in liabilities
- increase (decrease):
|
|
|
|
|
|
|
|
|
Accounts payable
and accrued expenses
|
|
|
74,118
|
|
|
|
452,285
|
|
Deferred rent
|
|
|
(11,522
|
)
|
|
|
(16,906
|
)
|
Deferred
salary
|
|
|
-
|
|
|
|
118,412
|
|
|
|
|
|
|
|
|
|
|
NET
CASH USED IN OPERATING ACTIVITIES
|
|
|
(2,777,621
|
)
|
|
|
(3,959,568
|
)
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Loans receivable
originated
|
|
|
(3,120,000
|
)
|
|
|
(5,381,851
|
)
|
Loans receivable
repaid
|
|
|
2,004,433
|
|
|
|
1,438,946
|
|
Advances to CEO
|
|
|
-
|
|
|
|
(95,003
|
)
|
Purchase
of property & equipment
|
|
|
-
|
|
|
|
(19,117
|
)
|
|
|
|
|
|
|
|
|
|
NET
CASH USED IN INVESTING ACTIVITIES
|
|
|
(1,115,567
|
)
|
|
|
(4,057,025
|
)
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Preferred dividends
paid
|
|
|
(35,517
|
)
|
|
|
(220,974
|
)
|
Proceeds from short-term
loans
|
|
|
-
|
|
|
|
400,000
|
|
Payments on short-term
loans
|
|
|
-
|
|
|
|
(400,000
|
)
|
Repayment of senior
debt
|
|
|
-
|
|
|
|
(2,230,000
|
)
|
Prepaid preferred
share redemption
|
|
|
|
|
|
|
(160,000
|
)
|
Payments for buyback
of common stock
|
|
|
(209,099
|
)
|
|
|
-
|
|
Proceeds from issuance
of preferred stock
|
|
|
246,000
|
|
|
|
6,100,000
|
|
Proceeds
from issuance of common stock
|
|
|
3,728,686
|
|
|
|
4,579,414
|
|
|
|
|
|
|
|
|
|
|
NET
CASH PROVIDED BY FINANCING ACTIVITIES
|
|
|
3,730,070
|
|
|
|
8,068,440
|
|
|
|
|
|
|
|
|
|
|
NET INCREASE (DECREASE)
IN CASH AND CASH EQUIVALENTS
|
|
|
(163,118
|
)
|
|
|
51,847
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH
EQUIVALENTS, BEGINNING OF YEAR
|
|
|
485,559
|
|
|
|
433,712
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, END OF YEAR
|
|
$
|
322,441
|
|
|
$
|
485,559
|
|
|
|
|
|
|
|
|
|
|
Supplemental disclosures:
|
|
|
|
|
|
|
|
|
Interest paid in
cash
|
|
$
|
-
|
|
|
$
|
508,800
|
|
Income taxes paid
in cash
|
|
$
|
2,134
|
|
|
$
|
-
|
|
Issuance of common
stock in lieu of repayment of accrued compensation
|
|
$
|
-
|
|
|
$
|
261,608
|
|
Issuance
of preferred stock in lieu of consulting fees
|
|
$
|
-
|
|
|
$
|
279,500
|
|
Advance
officer offset against preferred dividends & accrued compensation
|
|
$
|
-
|
|
|
$
|
95,003
|
|
Issuance
of common stock in lieu of consulting fees
|
|
$
|
169,500
|
|
|
$
|
156,954
|
|
See
report of independent registered public accounting firm and notes to consolidated financial statements.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature
of Business
The
principal business activity of the Company is providing unsecured $5,000 and $10,000 consumer loans over a five-year term through
its subsidiaries Investment Evolution Corporation and IEC SPV, LLC. The loans are offered under the consumer brand “Mr.
Amazing Loans”. The Company is headquartered in Las Vegas, Nevada and originates consumer loans in the states of Alabama,
Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana, Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio,
Oregon, Pennsylvania, Texas, Utah, and Virginia via its online platform and distribution network. The Company is a licensed direct
lender with state licenses and/or certificates of authority to lend in these 19 states and offers all loans within the prevailing
statutory rates.
Basis
of Accounting
These
consolidated financial statements include the operations of IEG Holdings Corporation and its wholly-owned subsidiaries, Investment
Evolution Corporation and IEC SPV, LLC (collectively, the “Company”). All inter-company transactions and balances
have been eliminated in consolidation.
The
Company’s accounting and reporting policies are in accordance with U.S. generally accepted accounting principles and conform
to general practices within the consumer finance industry.
The
consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United
States of America. The accompanying consolidated financial statements do not include any adjustments to reflect any possible future
effects on the recoverability and classification of assets or the amounts and classification of liabilities.
Liquidity
The
principal conditions/events that raise substantial doubt of the company’s ability to meet its obligations are i) the Company
has reported recurring losses and ii) the Company has not yet generated positive net cash flows from operations. However, the
Company has increased its revenue resulting from an increased average loan balance in 2016 as compared to 2015, and management
has evaluated the result of their plans for the next 12 months and as a result of the plans, the Company can meet all its obligations
through March 2018, which has alleviated the substantial doubt. Management’s plans include a continued reduction of advertising
costs to continue reducing loan originations and related loan processing costs. There is also a significant reduction in consulting
and professional fees due to minimized efforts and strategy for raising capital over the next 12 months. In addition, significant
core operating costs have been cut from the Company starting in 2016 including reducing the number of employees from 12 to 6 due
to increased automation of loan origination processes and reducing the number of office leases from 4 to 1 as old leases expired.
In addition, the CEO’s annual base consulting fee has been reduced to $1 per annum from January 1, 2017. Should the Company
need, management will continue to reduce loan originations and now plans to utilize the cash flow from loan repayments for working
capital needs. This will provide sufficient cash flow through at least March 2018. However, the Company intends, over the next
12 months, to seek additional capital via unsecured notes and/or preference shares to expand operations and the Company. Subsequent
to year-end, the Board of Directors approved a stock repurchase program. Management has no intention to repurchase shares unless
additional capital has been secured.
Use
of Estimates
The
preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States
of America requires management to make estimates and assumptions that affect the reported amounts and disclosures. Management
uses its historical records and knowledge of its business in making these estimates. Accordingly, actual results may differ from
these estimates.
Cash
and Cash Equivalents
For
the purpose of the statement of cash flows, the Company considers cash equivalents to include short-term, highly liquid investments
with an original maturity of three months or less.
Loans
Receivable and Interest Income
The Company
offers its loans at or below the prevailing statutory rates. Loans are carried at the unpaid principal amount outstanding, net
of an allowance for credit losses.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
The
Company calculates interest revenue using the interest yield method. Charges for late payments are credited to income when collected.
Accrual
of interest income on loans receivable is suspended when no payment has been received on account for 91 days or more on a contractual
basis, at which time a loan is considered delinquent. Payments received on nonaccrual financing loans are first applied to the
unpaid accrued interest and then principal. Loans are returned to active status and accrual of interest income is resumed when
all of the principal and interest amounts contractually due are brought current; at which time management believes future payments
are reasonably assured. At December 31, 2016, 83 loans with a total balance of $367,098 were delinquent or in default. At December
31, 2015, 80 loans with a total balance of $389,431 were delinquent or in default.
Allowance
for Credit Losses
The
Company maintains an allowance for credit losses due to the fact that it is probable that a portion of the loans receivable will
not be collected. The allowance is estimated by management based on various factors, including specific circumstances of the individual
loans, management’s knowledge of the industry, and the experience and trends of other companies in the same industry.
Our
portfolio of loans receivable consists of a large number of relatively small, homogenous accounts. The allowance for credit losses
is determined using a systematic methodology, based on a combination of historical bad debt of comparable companies. Impaired
loans are considered separately and 100% charged off.
The
allowance for credit losses is primarily based upon models that analyze specific portfolio statistics and also reflect, management’s
judgment regarding overall accuracy. We take into account several factors, including the customer’s transaction history,
specifically the timeliness of customer payments, the remaining contractual term of the loan, and the outstanding balance of the
loan.
Impaired
Loans
The
Company assesses loans for impairment individually when a loan is 91 days past due. The Company defines impaired loans as bankrupt
accounts and accounts that are 184 days or more past due. In accordance with the Company’s charge-off policy, once a loan
is deemed uncollectible, 100% of the remaining balance is charged-off. Loans can also be charged off when deemed uncollectable
due to consumer specific circumstances.
The Company does not accrue interest on impaired loans and any recoveries of impaired loans are
recorded to the allowance for credit losses. Changes in the allowance for credit losses are recorded as operating expenses in
the accompanying statement of operations.
Property
and Equipment
Property
and equipment are stated at cost. Depreciation and amortization are being provided using the straight-line method over the estimated
useful lives of the assets as follows:
Classification
|
|
Life
|
Computer equipment
|
|
5 years
|
Furniture
and fixtures
|
|
5-8 years
|
The
Company amortizes its leasehold improvements over the shorter of their economic lives, which are generally five years, or the
lease term that considers renewal periods that are reasonably assured. Expenses for repairs and maintenance are charged to expense
as incurred, while renewals and betterments are capitalized. When assets are retired or otherwise disposed of, the cost and accumulated
depreciation are removed from the accounts and any gain or loss is reflected in the consolidated statement of operations.
Operating
Lease
The
Company’s office lease in Las Vegas expires (unless renewed) on September 30, 2017.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
Income
Taxes
We
account for income taxes using the liability method in accordance with the Financial Accounting Standards Board (“FASB“)
Accounting Standards Codification (“ASC”) 740 “Income Taxes”. To date, no current income tax liability
has been recorded due to our accumulated net losses. Deferred income tax assets and liabilities are recognized for temporary differences
between the financial statement carrying amounts of assets and liabilities and the amounts that are reported in the income tax
returns. Our net deferred income tax assets have been fully reserved by a valuation allowance due to the uncertainty of our ability
to realize future taxable income and to recover our net deferred income tax assets.
Advertising
Costs
Advertising
costs are expensed as incurred. Advertising costs amounted to $373,350 and $950,905 at December 31, 2016 and 2015, respectively.
Earnings
and Loss per Share
The
Company computes net earnings (loss) per share in accordance with ASC 260-10 that establishes standards for computing and presenting
net earnings (loss) per shares. Basic earnings (loss) per share are computed by dividing net income (loss) attributed to common
shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed
similar to basic earnings per share except that the denominator is increased to include the number of additional common shares
that would have been outstanding if the potential common shares, if any, had been issued and if the additional common shares were
dilutive. Basic and diluted loss per share has been adjusted retroactively for the 1-for-100 reverse split that occurred on June
17, 2015 and for the net 1-for-10 reverse split that occurred on October 27, 2016.
Reclassifications
Certain
numbers from the prior period have been reclassified to conform to the current year presentation.
Fair
Value of Financial Instruments
The
Company has adopted guidance issued by the FASB that defines fair value, establishes a framework for measuring fair value in accordance
with existing generally accepted accounting principles, and expands disclosures about fair value measurements. Assets and liabilities
recorded at fair value in the consolidated balance sheets are categorized based upon the level of judgment associated with the
inputs used to measure their fair value. The categories are as follows:
|
Level
I
|
Inputs are unadjusted,
quoted prices for identical assets or liabilities in active markets at the measurement date.
|
|
|
|
|
Level
II
|
Inputs, other than
quoted prices included in Level I, that are observable for the asset or liability through corroboration with market data at
the measurement date.
|
|
|
|
|
Level
III
|
Unobservable inputs
that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the
measurement date.
|
At
December 31, 2016 and 2015, the only financial instruments that are subject to these classifications are cash and cash equivalents,
which are considered Level I assets.
Carrying amounts
reported in the consolidated balance sheets for other receivables, accounts payable, and accrued expenses approximate fair value
because of their immediate or short-term nature. The fair value of borrowings is not considered to be significantly different
than its carrying amount because the stated rates for such debt reflect current market rates and conditions.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
Recent
Accounting Pronouncements
Recently
Issued or Newly Adopted Accounting Standards
In
August 2014, the FASB issued FASB ASU 2014 -15,
Presentation of Financial Statements—Going Concern (Subtopic 205-40):
Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern
. FASB ASU 2014-15 changes to the
disclosure of uncertainties about an entity’s ability to continue as a going concern. These changes require an entity’s
management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about
the entity’s ability to continue as a going concern within one year after the date that financial statements are issued.
Substantial doubt is defined as an indication that it is probable that an entity will be unable to meet its obligations as they
become due within one year after the date that financial statements are issued. If management has concluded that substantial doubt
exists, then the following disclosures should be made in the financial statements: (i) principal conditions or events that
raised the substantial doubt, (ii) management’s evaluation of the significance of those conditions or events in relation
to the entity’s ability to meet its obligations, (iii) management’s plans that alleviated the initial substantial
doubt or, if substantial doubt was not alleviated, management’s plans that are intended to at least mitigate the conditions
or events that raise substantial doubt, and (iv) if the latter in (iii) is disclosed, an explicit statement that there
is substantial doubt about the entity’s ability to continue as a going concern. These changes became effective for the Company
for the 2016 annual period. Our adoption of these changes have no material impact on the consolidated financial statements.
In
November 2015, the FASB issued ASU No 2015-17,
Income Taxes
(Topic 740). The amendments in ASU 2015-17 change the requirements
for the classification of deferred taxes on the balance sheet. Currently, GAAP requires an entity to separate deferred income
tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position. To simplify the
presentation of deferred income taxes, the amendments in this ASU require that deferred tax liabilities and assets be classified
as noncurrent in a classified statement of financial position. The pronouncement is effective for fiscal years and interim periods
within those fiscal years beginning after December 15, 2016. Adoption of these changes have no material impact on the consolidated
financial statements.
In
January 2016, the FASB issued ASU 2016-01,
Financial Instruments – Overall
(Subtopic 825-10): Recognition and Measurement
of Financial Assets and Financial Liabilities. The update intends to enhance the reporting model for financial instruments to
provide users of financial statements with more decision-useful information and addresses certain aspects of the recognition,
measurement, presentation, and disclosure of financial instruments. The new standard affects all entities that hold financial
assets or owe financial liabilities. For public business entities, the amendments in this Update are effective for fiscal years
beginning after December 15, 2017, including interim periods within those fiscal years. Management is evaluating the impact of
the adoption of these changes will have on the consolidated financial statements.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
2.
LOANS RECEIVABLE
Loans
receivable consisted of the following at December 31:
|
|
2016
|
|
|
2015
|
|
Loans receivable
|
|
$
|
7,587,349
|
|
|
$
|
8,110,077
|
|
Allowance for
credit losses
|
|
|
(1,212,441
|
)
|
|
|
(985,375
|
)
|
Loans receivable,
net
|
|
$
|
6,374,908
|
|
|
$
|
7,124,702
|
|
A
reconciliation of the allowance for credit losses consist of the following at December 31:
|
|
2016
|
|
|
2015
|
|
Beginning balance
|
|
$
|
985,375
|
|
|
$
|
596,963
|
|
Provision for credit losses
|
|
|
1,865,362
|
|
|
|
1,134,518
|
|
Loans charged
off
|
|
|
(1,638,296
|
)
|
|
|
(746,106
|
)
|
Ending balance
|
|
$
|
1,212,441
|
|
|
$
|
985,375
|
|
Basis of Assessment:
|
|
|
|
|
|
|
|
|
Individually
|
|
$
|
-
|
|
|
$
|
-
|
|
Collectively
|
|
$
|
1,212,441
|
|
|
$
|
985,375
|
|
The
following is an age analysis of past due receivables as of December 31, 2016 and 2015:
|
|
|
30-60
Days
Past Due
|
|
|
61-90
Days
Past Due
|
|
|
Greater
Than
90 Days
|
|
|
Total
Past Due
|
|
|
Current
|
|
|
Total
Financing Receivables
|
|
|
Recorded
Investment >
90 Days and Not
Accruing
|
|
2016
|
|
|
$
|
257,299
|
|
|
$
|
163,590
|
|
|
$
|
367,098
|
|
|
$
|
787,987
|
|
|
$
|
6,799,362
|
|
|
$
|
7,587,349
|
|
|
$
|
367,098
|
|
2015
|
|
|
$
|
157,316
|
|
|
$
|
153,623
|
|
|
$
|
389,431
|
|
|
$
|
700,370
|
|
|
$
|
7,409,707
|
|
|
$
|
8,110,077
|
|
|
$
|
389,431
|
|
The
Company’s primary credit quality indicator is the customer’s Vantage credit score as determined by Experian on the
date of loan origination. The Company does not update the customer’s credit profile during the contractual term of the loan.
The following
is a summary of the loan receivable balance as of December 31, 2016 and 2015 by credit quality indicator:
Credit
Score
|
|
2016
|
|
|
2015
|
|
550-575
|
|
$
|
16,264
|
|
|
$
|
-
|
|
576-600
|
|
|
183,701
|
|
|
|
149,056
|
|
601-650
|
|
|
3,332,371
|
|
|
|
3,397,512
|
|
651-700
|
|
|
2,946,944
|
|
|
|
3,230,308
|
|
701-750
|
|
|
874,408
|
|
|
|
1,097,225
|
|
751-800
|
|
|
166,811
|
|
|
|
185,840
|
|
801-850
|
|
|
46,368
|
|
|
|
50,136
|
|
851-900
|
|
|
20,482
|
|
|
|
-
|
|
|
|
$
|
7,587,349
|
|
|
$
|
8,110,077
|
|
3.
PROPERTY AND EQUIPMENT
At
December 31, 2016 and 2015, property and equipment consists of the following:
|
|
2016
|
|
|
2015
|
|
Computer equipment
|
|
$
|
99,556
|
|
|
$
|
111,196
|
|
Furniture and fixtures
|
|
|
21,303
|
|
|
|
21,303
|
|
Leasehold improvements
|
|
|
7,112
|
|
|
|
35,897
|
|
|
|
|
127,971
|
|
|
|
168,396
|
|
Less accumulated
depreciation and amortization
|
|
|
108,649
|
|
|
|
139,885
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
19,322
|
|
|
$
|
28,511
|
|
Depreciation
of property and equipment amounted to $8,618 and $14,124 during the years ended December 31, 2016 and 2015, respectively. Depreciation
costs are included in the accompanying statements of operations in operating expenses.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
4.
SENIOR DEBT
On
August 21, 2015, we, through certain of our wholly owned subsidiaries, paid an aggregate of $1,676,954, representing all principal
and accrued interest under the Loan and Security Agreement, as amended (the “Loan Agreement”), among BFG and certain
of our wholly owned subsidiaries. As a result, there is currently no outstanding balance under the Loan Agreement. However, the
Loan Agreement continues in effect and we are subject to a net profit interest under which we are required to pay BFG 20% of the
“Net Profit” of its subsidiary, IEC SPV, LLC, until 10 years from the date the loan is repaid in full (August 2015).
Net Profit is defined as the gross revenue less (i) interest paid on the loan, (ii) payments on any other debt incurred as a result
of refinancing the loan through a third party, as provided in the Loan Agreement, (iii) any costs, fees or commissions paid on
the existing credit facility, and (iv) charge-offs to bad debt resulting from consumer loans and reduced by servicing fee. The
Net Profit arrangement can be terminated by us upon a payment of $3,000,000 to BFG. Net profit interest for the year ended December
31, 2016 and 2015 were $57,094 and $107,340, respectively. All loans receivable of the Company were pledged as collateral at December
31, 2016 for the fulfillment of the Net Profit calculation. As of December 31, 2016, $57,094 has been paid.
5.
WORKING CAPITAL LOANS
On
April 13, 2015, the Company secured a $200,000 working capital loan to expand from Dr. L. Prasad, an investor in the Company.
On June 24, 2015, the Company repaid $230,000 which comprised $200,000 principal and a $30,000 facility fee which was recorded
as interest expense.
On
April 13, 2015, the Company secured a $100,000 working capital loan to expand from Domenic Tacca, an investor in the Company.
On June 24, 2015, the Company repaid $115,000 which comprised $100,000 principal and a $15,000 facility fee which was recorded
as interest expense.
On
April 13, 2015, the Company secured a $100,000 working capital loan to expand from CT Super, an investor in the Company. On June
24, 2015, the Company repaid $115,000 which comprised $100,000 principal and a $15,000 facility fee which was recorded as interest
expense.
The effective
interest rate on these loans was 81.1% for the year ended December 31, 2015.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
6.
STOCKHOLDERS’ EQUITY
On
January 1, 2016, pursuant to the terms of the Company’s Series G preferred stock, the Company exercised its right to redeem
all of the unconverted outstanding shares of Series G preferred stock. On December 24, 2015, the Company early paid the holders
of the 160,000 unconverted shares of Series G preferred stock an aggregate of $160,000. Following the redemption of the unconverted
shares of Series G preferred stock, no shares of Series G preferred stock were outstanding.
On
January 22, 2016, the Company issued an aggregate of 370 shares of the Company’s common stock at a price of $50.00 per share
to a total of two existing stockholders, each of whom resided in Australia, for receipt of an aggregate of $18,500. These securities
were issued in reliance upon the exemptions provided by Regulation S promulgated pursuant to the Securities Act. The issuances
involved offers and sales of securities outside the United States. The offers and sales were made in offshore transactions and
no directed selling efforts were made by the issuer, a distributor, their affiliates or any persons acting on their behalf. An
offering circular was used in connection with this offering.
On
March 22, 2016, the Company issued an aggregate of 3,071,000 shares of the Company’s Series H preferred stock to a total
of 12 existing stockholders, nine of whom resided in Australia and three of whom resided in the United Kingdom, in exchange for
the receipt of $1.00 per share, representing an aggregate purchase price of $3,071,000. These securities were issued in reliance
upon the exemptions provided by Regulation S promulgated pursuant to the Securities Act. The issuances involved offers and sales
of securities outside the United States. The offers and sales were made in offshore transactions and no directed selling efforts
were made by the issuer, a distributor, their affiliates or any persons acting on their behalf. No offering circular was used
in connection with this issuance. In connection with this, the Company had a subscription receivable for $2,825,000.
On March 31,
2016, Paul Mathieson, the Company’s Chief Executive Officer and the sole holder of the Company’s Series A preferred
stock notified the Company of his intention to convert all of his Series A preferred stock into Company common stock pursuant
to the terms of the Series A preferred stock. The Company issued an aggregate of 6,400,000 shares of Company common stock pursuant
to the conversion notice. These securities were issued in reliance upon the exemptions provided by Regulation S promulgated pursuant
to the Securities Act. The issuance involved offers and sales of securities outside the United
States.
The offers and sales were made in offshore transactions and no directed selling efforts were made by the issuer, a distributor,
their affiliates or any persons acting on their behalf. No offering circular was used in connection with this issuance. Following
the conversion, no shares of Series A preferred stock were outstanding.
On
April 1, 2016, the Company effected a 1-for-100 reverse stock split of its outstanding shares of the common stock. Stockholders
whose shares were converted into less than one share in the reverse stock split received cash payments equal to the fair value
of those fractional interests. As a result, the Company repurchased a total of 1,793 shares of common stock from those stockholders
whose shares of stock were converted into less than one share, for an aggregate purchase price of $130,769. Immediately after
the reverse stock split, on April 1, 2016, the Company effected a 100-for-1 forward stock split and reduced the number of authorized
shares of common stock from 3,000,000,000 to 200,000,000. The Company effected the reverse stock split followed immediately by
the forward stock split in order to eliminate the administrative burden and costs associated with small stockholder accounts,
and to provide stockholders with fewer than 100 shares of common stock with a cost-effective way to cash out their investments.
On
April 12, 2016, the Company issued an aggregate of 2,000 shares of the Company’s common stock to MZ Group for investor relations
consulting services. The securities issuance was exempt from registration under the Securities Act, in reliance on the exemptions
provided by Section 4(a)(2) and Section 2(a)(3), as applicable under the Securities Act.
On
May 2, 2016, Company issued an aggregate of 243,967 shares of the Company’s common stock at a price of $10.00 per share
to a total of 98 existing stockholders, all of whom resided in Australia, for an aggregate of $2,439,673 of which $87,000 was
paid for in consulting services provided to the company. The securities issuances were exempt from registration under the Securities
Act, in reliance on an exemption provided by Regulation S promulgated pursuant to the Securities Act. The issuances involved offers
and sales of securities outside the United States. The offers and sales were made in offshore transactions and no directed selling
efforts were made by the issuer, a distributor, their affiliates or any persons acting on their behalf. An offering circular was
used in connection with this offering.
On May 16, 2016, the Company filed
articles of amendment (the “May 2016 Amendment”) to its amended and restated articles of incorporation, as amended.
The May 2016 Amendment has the effect of:
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
|
(i)
|
Eliminating the
Company’s Series A preferred stock, Series F preferred stock and Series G preferred stock, and
|
|
|
|
|
(ii)
|
Revising the terms
of the Series H preferred stock to:
|
|
(a)
|
reduce the dividend
rate on the Company’s Series H preferred stock from 10% per annum to 8% per annum,
|
|
|
|
|
(b)
|
extend the date
after which the Company may redeem the unconverted outstanding shares of Series H preferred stock from June 30, 2016 to December
31, 2016,
|
|
|
|
|
(c)
|
extend the date
on which the holders of Series H preferred stock may convert their shares into shares of the Company’s common stock
from June 30, 2016 to December 31, 2016, and
|
|
|
|
|
(d)
|
remove the requirement
to adjust the Series H preferred stock conversion ratio when the Company conducts a rights offering to its existing stockholders.
|
As
of September 30, 2016, the aggregate number of shares which the Company had the authority to issue is 250,000,000 shares, of which
200,000,000 shares are common stock, par value $0.001 per share, and 50,000,000 shares are preferred stock, par value $0.001 per
shares. At September 30, 2016, the Company had 9,672,723 shares of common stock issued and outstanding. At September 30, 2016,
the Company also had 3,071,000 shares of Series H preferred stock issued and outstanding. The Board of Directors is authorized
at any time, and from time to time, to provide for the issuance of preferred stock in one or more series, and to determine the
designations, preferences, limitations and relative or other rights of the preferred stock or any series thereof.
The
Series H preferred stock accrues dividends at the rate of 8% per annum. Each series of preferred stock ranks pari passu with each
other series of preferred stock, and senior to the common stock of the Company, as to dividends, and upon liquidation, dissolution
or a winding up of the Company. In the event of a liquidation or winding up of the Company, holders of the preferred stock shall
be entitled to receive the stated value of $1 per share.
On
September 6, 2016, the Company issued an aggregate of 5,000 shares of the Company’s common stock to MZ Group for investor
relations consulting services. The securities issuance was exempt from registration under the Securities Act, in reliance on the
exemptions provided by Section 4(a)(2) and Section 2(a)(3), as applicable under the Securities Act.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
On
September 6, 2016, Company issued an aggregate of 135,751 shares of the Company’s common stock at a price of $10.00 per
share to a total of 84 existing stockholders, 48 of whom resided in Australia and 36 of whom resided in United States, for an
aggregate of $1,357,515. The securities issuances were registered pursuant to a registration statement on Form S-1 that was declared
effective by the Securities and Exchange Commission on August 8, 2016.
On
August 26, 2016, the Company’s board of directors and a stockholder holding a majority of the voting power of the Company’s
issued and outstanding shares of common stock approved the following corporate actions:
1.
Effect a reverse stock split of the outstanding shares of the Company’s common stock, at the ratio of 1-for-1,000 (the “Reverse
Split”).
2.
Immediately following the completion of the Reverse Split, effect a forward stock split on a 100-for-1 share basis (the “Forward
Split”) and reduce the number of authorized shares of common stock from 200,000,000 to 40,000,000 (the “Authorized
Share Reduction”).
The
Reverse Split and Forward Split were effective on October 27, 2016 when they were approved by FINRA, as required. As a result,
the Company repurchased a total of 129,571 shares of common stock from those stockholders whose shares of stock were converted
into less than one share, for an aggregate purchase price of $78,330. Any fractional shares held after the Forward Split were
rounded up to the next whole share. As a result of the rounding up of fractional shares, the Company issued an additional 218
shares on October 27, 2016. The Company’s 2015 Financial Statements have been retroactively restated to reflect this net
1-for-10 reverse split. The Company effected the reverse stock split followed immediately by the forward stock split in order
to eliminate the administrative burden and costs associated with small stockholder accounts, and to provide stockholders with
fewer than 1,000 shares of common stock with a cost-effective way to cash out their investments.
On
December 5, 2016, the Company increased its authorized shares of common stock from 40,000,000 to 300,000,000.
On
December 31, 2016, the Company issued an aggregate of 5,000 shares of the Company’s common stock to Worldwide Holdings,
LLC for investor relations consulting services. The securities issuance was exempt from registration under the Securities Act,
in reliance on the exemptions provided by Section 4(a)(2) and Section 2(a)(3), as applicable under the Securities Act.
On
December 31, 2016, pursuant to the terms of the Company’s Series H preferred stock, holders of an aggregate of 246,000 Series
H preferred shares exercised their rights to convert their Series H preferred shares into 49,200 shares of the Company’s
common stock. Also on December 31, 2016, following such conversions, the Company exercised its right to redeem all of the unconverted
outstanding shares of Series H preferred stock and cancelled the 2,825,000 shares of Series H preferred stock for an aggregate
amount of $2,825,000 which were subscribed to during 2016, but remained unpaid for. These securities were issued in reliance upon
the exemptions provided by Regulation S promulgated pursuant to the Securities Act. The issuance involved offers and sales of
securities outside the United States. The offers and sales were made in offshore transactions and no directed selling efforts
were made by the issuer, a distributor, their affiliates or any persons acting on their behalf. No offering circular was used
in connection with this issuance. Following the conversion, no shares of Series H preferred stock were outstanding. Following
the redemption of the unconverted shares of Series H preferred stock, no shares of Series H preferred stock were outstanding.
Series
H Preferred Stock
During
the year ended December 31, 2016 and year ended December 31, 2015, the Company issued 3,071,000 and 160,000 of Series H convertible
preferred stock, respectively, with a par value of $0.001 per share. As at December 31, 2016 there is no outstanding Series H
preferred stock on issue.
7. INCOME
TAXES
The
difference between income tax expense attributable to continuing operations and the amount of income tax expense that would result
from applying domestic federal statutory rates to pre-tax income (loss) is mainly related to an increase in the valuation allowance.
Valuation allowances are established, when necessary, to reduce deferred income tax assets to the amount expected to be realized.
Deferred income tax assets are mainly related to net operating loss carryforwards.
Management has chosen to take
a 100% valuation allowance against the deferred income tax asset until such time as management believes that its projections of
future profits make the realization of the deferred income tax assets more likely than not. Significant judgment is required in
the evaluation of deferred income tax benefits and differences in future results from management’s estimates could result
in material differences.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
As
of December 31, 2016, the Company has a net loss carryforward of approximately $21 million that may potentially be used to offset
future Federal taxable income. This net loss carryforward will expire through 2036. In the event of statutory ownership changes,
the amount of net operating loss carryforward that may be utilized in future years is subject to significant limitations.
The
Company has adopted guidance issued by the FASB that clarifies the accounting for uncertainty in income taxes recognized in an
enterprise’s financial statements and prescribes a recognition threshold of more likely than not and a measurement process
for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. In making
this assessment, a company must determine whether it is more likely than not that a tax position will be sustained upon examination,
based solely on the technical merits of the position and must assume that the tax position will be examined by taxing authorities.
The Company’s policy is to include interest and penalties related to unrecognized tax benefits in income tax expense. Interest
and penalties totaled $0 for the years ended December 31, 2016 and 2015. The Company files income tax returns with the Internal
Revenue Service (“IRS”) and the states of Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana,
Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, and Virginia. All of the Company’s
tax filings are still subject to examination. The Company’s net operating loss carryforwards are subject to IRS examination
until they are fully utilized and such tax years are closed.
We
utilize FASB ASC 740-10, “Income Taxes” which requires the recognition of deferred tax assets and liabilities for
the expected future tax consequences of events that have been included in the financial statements or tax returns.
Under
this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases
of assets and liabilities and their financial reporting amounts at each year end based on enacted tax laws and statutory tax rates
applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established,
when necessary, to reduce deferred tax assets to the amount expected to be realized. The provision for income taxes represents
the tax payable for the period and the change during the period in deferred tax assets and liabilities.
The
components of the income tax provision for fiscal year 2016 and 2015 were as follows:
|
|
|
2016
|
|
|
2015
|
|
Current
|
|
|
|
|
|
|
|
|
|
Federal
|
|
|
$
|
0
|
|
|
$
|
0
|
|
State
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
0
|
|
|
|
0
|
|
Deferred
|
|
|
|
|
|
|
|
|
|
Federal
|
|
|
|
0
|
|
|
|
0
|
|
State
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
0
|
|
|
$
|
0
|
|
A
reconciliation of the expected income tax (benefit) computed using the federal statutory income tax rate to the Company’s
effective income tax rate is as follows for fiscal year 2016 and 2015:
|
|
2016
|
|
|
2015
|
|
Income tax computed at federal
statutory tax rate
|
|
|
-34.0
|
%
|
|
|
-34.0
|
%
|
Non-deductible expenses
|
|
|
5.7
|
|
|
|
2.2
|
|
Change in Valuation
allowance
|
|
|
28.3
|
|
|
|
31.8
|
|
Total
|
|
|
0
|
%
|
|
|
0
|
%
|
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
Significant
components of the Company’s deferred tax assets and liabilities for income taxes for the fiscal years ended December 31,
2016 and 2015 are as follows:
|
|
2016
|
|
|
2015
|
|
Deferred tax assets
|
|
|
|
|
|
|
|
|
Provision for credit losses
|
|
$
|
412,000
|
|
|
$
|
335,000
|
|
Deferred rent
|
|
|
|
|
|
|
4,000
|
|
Intangible assets
|
|
|
391,000
|
|
|
|
425,000
|
|
Net Operating
loss carryforwards
|
|
|
7,400,000
|
|
|
|
5,650,000
|
|
Total deferred tax assets
|
|
|
8,203,000
|
|
|
|
6,414,000
|
|
Less: Valuation
allowance
|
|
|
(8,203,000
|
)
|
|
|
(6,414,000
|
)
|
Net
deferred tax assets
|
|
$
|
0
|
|
|
$
|
0
|
|
8.
|
CONCENTRATION
OF CREDIT RISK
|
The
Company’s portfolio of finance receivables is with consumers living throughout Alabama, Arizona, California, Florida, Georgia,
Illinois, Kentucky, Louisiana, Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, and
Virginia and consequently such consumers’ ability to honor their installment contracts may be affected by economic conditions
in these areas.
The
Company maintains cash at financial institutions which may, at times, exceed federally insured limits.
At December
31, 2016 the company had cash and cash equivalents exceeding insured limits by $85,596.
9.
|
COMMITMENTS
AND CONTINGENCIES
|
Operating
Leases
The
Company renewed its operating facility lease effective October 1, 2016 under a non-cancelable operating lease that expires on
30 September 2017. Monthly rental payments under this lease are $4,693 plus a proportionate share of operating expenses. The Company
previously had leases for operating facilities in Florida, Illinois and Arizona all of which terminated during 2016. Total rent
expense for the year ended December 31, 2016 and 2015 was $178,678 and $244,621, respectively. The Company is responsible for
certain operating expenses in connection with these leases.
Legal
Matters
From
time to time, the Company may be involved in legal proceedings in the normal course of its business. The Company is not involved
in any legal proceedings at the present time.
Professional
Consulting Contract
The
Company had a professional consulting contract with its Chief Executive Officer (“CEO”), according to which, the Company
paid $1,000,000 and health insurance for the year ended December 31, 2016. The Company was obligated to pay its CEO $1,000,000
annually plus health insurance, with a discretionary bonus to be determined by the Company’s Board on December 31, 2016.
There was no bonus approved or paid for the year ended December 31, 2016.
Regulatory
Requirements
State
statutes authorizing the Company’s products and services typically provide state agencies that regulate banks and financial
institutions with significant regulatory powers to administer and enforce the law. Under statutory authority, state regulators
have broad discretionary power and may impose new licensing requirements, interpret or enforce existing regulatory requirements
in different ways, or issue new administrative rules. In addition, when the staff of state regulatory bodies change, it is possible
that the interpretations of applicable laws and regulations may also change.
Net
Profit Interest
The Company
has a net profit interest agreement with its lender, under which the Company pays 20% of its subsidiary IEC SPV LLC’s net
profit to the lender (see note 4).
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
10.
|
RELATED
PARTY TRANSACTIONS
|
Chief
Executive Officer
Compensation
to our Chief Executive Officer under the 2015 Consulting Contract totaled $1,000,000 for the year ended December 31, 2016. Compensation
to our Chief Executive Officer under the 2015 Consulting Contract totaled $1,300,000 for the year ended December 31, 2015, of
which, $220,079 was offset against common stock subscription.
Chief
Operating Officer
Compensation
to our Chief Operating Officer totaled $243,000 for the year ended December 31, 2016. Compensation to our Chief Operating Officer
totaled $250,000 for the year ended December 31, 2015, of which, $20,000 was offset against common stock subscription.
VP
Corporate Finance
Compensation
to our VP Corporate Finance totaled $121,721 for the year ended December 31, 2015, of which $14,029 was offset against common
stock subscription.
Consulting
Fees
During
the years ended December 31, 2016 and December 31, 2015, the Company incurred director fees totaling $0 and $27,500, respectively,
to Gilmour & Company Pty Ltd., which is owned by Ian Gilmour, a former director of IEG Holdings Corporation.
During
the years ended December 31, 2016 and December 31, 2015, the Company incurred director fees totaling $29,800 and $27,500, respectively,
to Matthew Banks, who is a former director of IEG Holdings Corporation. $20,000 of the $27,500 consulting fees incurred in year
ended December 31, 2015 was paid, with the remaining $7,500 offset as consideration for common stock subscriptions by Ian Banks
(Matthew Banks’ father).
During
the years ended December 31, 2016 and December 31, 2015, the Company incurred director fees totaling $29,800 and $27,500, respectively
to R & H Nominees Pty Ltd which is owned by Harold Hansen, who is a former director of IEG Holdings Corporation.
During
the years ended December 31, 2016 and December 31, 2015, the Company incurred director fees totaling $0 and $4,500 to Comms Watch
Pty Ltd, which is owned by Damien Mathieson, a former director and the brother of our Chief Executive Officer.
During
the years ended December 31, 2016 and December 31, 2015, the Company incurred consulting fees totaling $40,000 and $318,857, respectively,
to Clem Tacca, who is a shareholder of IEG Holdings Corporation, and related entities.
During
the years ended December 31, 2016 and December 31, 2015, the Company incurred consulting fees totaling $82,886 and $66,098, respectively,
to Ascendant SC Pty Ltd, which is a shareholder of IEG Holdings Corporation. $35,000 of the consulting fees incurred in 2016 were
offset as consideration for Common Stock on May 2, 2016. $25,000 of the consulting fees incurred were offset as consideration
for Series G Preferred Stock on June 19, 2015 and $10,000 of the consulting fees incurred were offset as consideration for common
stock subscriptions at December 31, 2015.
During
the years ended December 31, 2016 and December 31, 2015, the Company incurred consulting fees totaling $120,404 and $419,204,
respectively, to Frank Wilkie, who is a shareholder of IEG Holdings Corporation, and related entities. $70,250 of the $419,204
consulting fees incurred in the year ended December 31, 2015 was paid, with $224,500 offset as consideration for Series G Preferred
Stock on June 19, 2015 and $124,454 offset as consideration for common stock subscriptions.
During
the years ended December 31, 2016 and December 31, 2015, the Company incurred consulting fees totaling $50,700 and $75,000, respectively,
to Judith Willoughby, who is a shareholder of IEG Holdings Corporation, and related entities. $55,000 of the $75,000 consulting
fees incurred in the year ended December 31, 2015 was paid, with the remaining $20,000 offset as consideration for common stock
subscriptions.
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
During
the year ended December 31, 2016, the Company incurred consulting fees totaling $26,000 to Custom Print Consulting, who is a shareholder
of IEG Holdings Corporation, and related entities. All of the $26,000 was offset as consideration for common stock subscriptions.
During
the year ended December 31, 2016, the Company incurred consulting fees totaling $26,000 to BW Equities Pty Ltd, who is a shareholder
of IEG Holdings Corporation, and related entities. All of the $26,000 was offset as consideration for common stock subscriptions.
During
the year ended December 31, 2016, the Company incurred consulting fees totaling $162,500 to Worldwide Holdings LLC, who is a shareholder
of IEG Holdings Corporation, and related entities. $150,000 of the $162,500 consulting fees incurred was paid, with the remaining
$12,500 offset as consideration for common stock subscriptions.
During the
year
ended December 31, 2016, the Company incurred consulting fees totaling $166,524 to MZHCI LLC, who is a shareholder of IEG Holdings
Corporation, and related entities. $96,524 of the $166,524 consulting fees incurred was paid, with the remaining $70,000 offset
as consideration for common stock subscriptions.
11.
|
RIGHTS
OFFERING AND CHANGE IN CONVERSION RATIO OF PREFERRED SHARES
|
Effective
August 3, 2015 and December 1, 2015, the Company commenced rights offerings to certain of its existing stockholders. Pursuant
to the terms of the Series A preferred stock, the Series F preferred stock, the Series G preferred stock and the Series H preferred
stock, as a result of the Company’s commencement of the rights offerings, the Company adjusted the conversion ratio applicable
to each series of preferred stock.
On September 10, 2015, the
Company filed articles of amendment to its amended and restated articles of incorporation, as amended, with the Secretary of State
of Florida. The articles of amendment had the effect of adjusting the conversion ratios of the Series A, Series F, Series G and
Series H preferred stock to account for the Company’s offering to existing stockholders of the
Corporation
commenced August 3, 2015 and removing references to conversion on June 30, 2015 for Series F and Series G preferred stock:
|
(i)
|
Adjusting the conversion
ratio of the Series A preferred stock from 0.4 to 0.8 shares of common stock for each Series A preferred stock;
|
|
|
|
|
(ii)
|
Adjusting the conversion
ratio of the Series F preferred stock from 3,333/100,000 (0.03333) to 6,666/100,000 (0.06666) shares of common stock for each
Series F preferred stock;
|
|
|
|
|
(iii)
|
Adjusting the conversion
ratio of the Series G preferred stock from 2,000/100,000 (0.02000) to 4,000/100,000 (0.04000) shares of common stock for each
Series G preferred stock; and
|
|
|
|
|
(iv)
|
Adjusting the conversion
ratio of the Series H preferred stock from 1,333/100,000 (0.01333) to 2,666/100,000 (0.02666) shares of common stock for each
Series H preferred stock.
|
IEG
HOLDINGS CORPORATION
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER
31, 2016 AND 2015
On
December 1, 2015, the Company filed articles of amendment to its amended and restated articles of incorporation, as amended, with
the Secretary of State of Florida. The articles of amendment had the effect of adjusting the conversion ratios of the Series A,
Series F, Series G and Series H preferred stock to account for the Company’s offering to existing stockholders of the Corporation
commenced December 1, 2015:
|
(i)
|
Adjusting the conversion
ratio of the Series A preferred stock from 0.8 to 1.6 shares of common stock for each Series A preferred stock;
|
|
|
|
|
(ii)
|
Adjusting the conversion
ratio of the Series F preferred stock from 6,666/100,000 (0.06666) to 13,332/100,000 (0.13332) shares of common stock for
each Series F preferred stock;
|
|
|
|
|
(iii)
|
Adjusting the conversion
ratio of the Series G preferred stock from 4,000/100,000 (0.04000) to 8,000/100,000 (0.08000) shares of common stock for each
Series G preferred stock; and
|
|
|
|
|
(iv)
|
Adjusting the conversion
ratio of the Series H preferred stock from 2,666/100,000 (0.02666) to 5,332/100,000 (0.05332) shares of common stock for each
Series H preferred stock.
|
O
n
January 5, 2017, we commenced a tender offer to purchase up to all outstanding shares of common stock of OneMain Holdings Inc.,
a NYSE-listed company;
provided, however,
that we are willing to accept any number of shares of OneMain common stock, even
if such shares, in the aggregate, constitute less than a majority of OneMain’s outstanding common stock (the “OneMain
Tender Offer”). The OneMain Tender Offer was scheduled to expire at 12:00 a.m., Eastern time, on February 6, 2017, unless
extended. On February 7, 2017, we extended the OneMain Tender Offer such that it will expire at 5:00 p.m., Eastern time, on Monday,
March 27, 2017, unless it is extended or earlier terminated. Complete terms and conditions of the OneMain Tender Offer are set
forth in the Tender Offer Statement on Schedule TO and in the registration statement on Form S-4, each of which we originally
filed with the SEC on January 5, 2017, and each of which as may be amended. This description and other information in this annual
report on Form 10-K regarding the OneMain Tender Offer is included in this annual report on Form 10-K solely for informational
purposes. Nothing in this annual report on Form 10-K should be construed as an offer to sell, nor the solicitation of an offer
to buy, any shares in connection with the OneMain Tender Offer.
IEG
HOLDINGS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
JUNE
30,
2017 AND DECEMBER 31, 2016
|
|
June
30, 2017
|
|
|
December
31, 2016
|
|
|
|
(Unaudited)
|
|
|
(Audited)
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$
|
3,743,268
|
|
|
$
|
322,441
|
|
Loans receivable,
net, note 2
|
|
|
5,055,063
|
|
|
|
6,374,908
|
|
Other receivables
|
|
|
60,480
|
|
|
|
84,851
|
|
Prepaid expenses
|
|
|
2,457
|
|
|
|
12,955
|
|
Property and equipment,
net, note 3
|
|
|
16,278
|
|
|
|
19,322
|
|
Security
deposits
|
|
|
7,470
|
|
|
|
7,470
|
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$
|
8,885,016
|
|
|
$
|
6,821,947
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
Common
stock dividends payable
|
|
$
|
48,571
|
|
|
$
|
-
|
|
Accounts
payable and accrued expenses
|
|
|
66,431
|
|
|
|
1,060
|
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES
|
|
$
|
115,002
|
|
|
$
|
1,060
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES, note 7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
Preferred stock,
$0.001 par value; 50,000,000 shares authorized, 0 and 0 shares issued and outstanding at June 30, 2017 and December
31, 2016 respectively, note 5
|
|
|
-
|
|
|
|
-
|
|
Common stock, $0.001
par value; 300,000,000 shares authorized, 12,754,066 and 9,714,186 shares issued and outstanding at June 30,
2017 and December 31, 2016 respectively, note 5
|
|
|
2,236,222
|
|
|
|
2,233,182
|
|
Additional paid-in
capital
|
|
|
33,200,034
|
|
|
|
29,698,025
|
|
Accumulated
deficit
|
|
|
(26,666,241
|
)
|
|
|
(25,110,319
|
)
|
|
|
|
|
|
|
|
|
|
TOTAL
STOCKHOLDERS’ EQUITY
|
|
|
8,770,014
|
|
|
|
6,820,887
|
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
$
|
8,885,016
|
|
|
$
|
6,821,947
|
|
See
notes to condensed consolidated unaudited Financial Statements
IEG
HOLDINGS CORPORATION
CONDENSED
CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
FOR
THE THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 2017 AND 2016
|
|
Three
Months Ended
|
|
|
Six
Months Ended
|
|
|
|
June
30, 2017
|
|
|
June
30, 2016
|
|
|
June
30, 2017
|
|
|
June
30, 2016
|
|
REVENUES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
revenue
|
|
$
|
400,986
|
|
|
$
|
526,380
|
|
|
$
|
851,715
|
|
|
$
|
1,039,172
|
|
Other
revenue
|
|
|
12,955
|
|
|
|
18,976
|
|
|
|
29,609
|
|
|
|
31,156
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
REVENUES
|
|
|
413,941
|
|
|
|
545,356
|
|
|
|
881,324
|
|
|
|
1,070,328
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries
and compensation
|
|
|
118,925
|
|
|
|
406,323
|
|
|
|
239,203
|
|
|
|
809,329
|
|
Other
operating expenses
|
|
|
79,362
|
|
|
|
206,610
|
|
|
|
194,566
|
|
|
|
388,137
|
|
Provision
for credit losses
|
|
|
394,836
|
|
|
|
354,918
|
|
|
|
619,324
|
|
|
|
742,437
|
|
Advertising
|
|
|
2,580
|
|
|
|
173,485
|
|
|
|
3,460
|
|
|
|
221,309
|
|
Rent
|
|
|
18,032
|
|
|
|
52,778
|
|
|
|
28,889
|
|
|
|
107,465
|
|
Public
company and corporate finance expenses
|
|
|
697,344
|
|
|
|
600,530
|
|
|
|
1,195,535
|
|
|
|
1,010,779
|
|
Depreciation
and amortization
|
|
|
1,471
|
|
|
|
1,917
|
|
|
|
3,044
|
|
|
|
3,833
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
OPERATING EXPENSES
|
|
|
1,312,550
|
|
|
|
1,796,561
|
|
|
|
2,284,021
|
|
|
|
3,283,289
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LOSS
FROM OPERATIONS
|
|
|
(898,609
|
)
|
|
|
(1,251,205
|
)
|
|
|
(1,402,697
|
)
|
|
|
(2,212,961
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
INCOME (EXPENSE)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
on sale of marketable securities
|
|
|
(153,514
|
)
|
|
|
-
|
|
|
|
(153,514
|
)
|
|
|
-
|
|
Miscellaneous
income (expense)
|
|
|
140
|
|
|
|
6,673
|
|
|
|
289
|
|
|
|
11,750
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
OTHER INCOME (EXPENSE)
|
|
|
(153,374
|
)
|
|
|
6,673
|
|
|
|
(153,225
|
)
|
|
|
11,750
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
LOSS
|
|
$
|
(1,051,983
|
)
|
|
$
|
(1,244,532
|
)
|
|
$
|
(1,555,922
|
)
|
|
$
|
(2,201,211
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
on preferred shares
|
|
|
-
|
|
|
|
(1,421
|
)
|
|
|
-
|
|
|
|
(31,360
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss attributable to common stockholders
|
|
|
(1,051,983
|
)
|
|
|
(1,245,953
|
)
|
|
|
(1,555,922
|
)
|
|
|
(2,232,571
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED
STATEMENT OF COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized
loss on marketable securities
|
|
|
(153,514
|
)
|
|
|
-
|
|
|
|
(153,514
|
)
|
|
|
-
|
|
Less:
Reclassified adjustment for losses included in net loss
|
|
|
153,514
|
|
|
|
-
|
|
|
|
153,514
|
|
|
|
-
|
|
Comprehensive
loss attributable to common stockholders
|
|
|
(1,051,983
|
)
|
|
|
(1,245,953
|
)
|
|
|
(1,555,922
|
)
|
|
|
(2,232,571
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss attributable to common stock per share, basic and diluted
|
|
$
|
(0.10
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.16
|
)
|
|
$
|
(0.36
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares outstanding, basic and diluted
|
|
|
10,248,670
|
|
|
|
9,443,236
|
|
|
|
9,982,905
|
|
|
|
6,201,981
|
|
See
notes to condensed consolidated unaudited Financial Statements
IEG
HOLDINGS CORPORATION
CONDENSED
CONSOLIDATED UNAUDITED STATEMENTS OF STOCKHOLDERS’ EQUITY
FOR
THE PERIOD FROM JANUARY 1, 2016 THROUGH JUNE 30, 2017
|
|
|
|
|
|
|
|
Preferred
Stock
|
|
|
Preferred
Stock
|
|
|
Preferred
Stock
|
|
|
Additional
|
|
|
Prepaid
Preferred
|
|
|
|
|
|
|
|
|
Accumulated
Other
|
|
|
|
|
|
|
Common
Stock
|
|
|
Series
A
|
|
|
Series
G
|
|
|
Series
H
|
|
|
Paid-in
|
|
|
Share
|
|
|
Subscription
|
|
|
Accumulated
|
|
|
Comprehensive
|
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Redemption
|
|
|
Receivable
|
|
|
Deficit
|
|
|
Income
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, January
1, 2016
|
|
|
2,887,428
|
|
|
$
|
2,165,405
|
|
|
|
1,000,000
|
|
|
$
|
1,000
|
|
|
|
160,000
|
|
|
$
|
160
|
|
|
|
-
|
|
|
$
|
-
|
|
|
$
|
26,025,071
|
|
|
$
|
(160,000
|
)
|
|
$
|
-
|
|
|
$
|
(20,381,450
|
)
|
|
$
|
-
|
|
|
$
|
7,650,186
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepaid
Preferred Share Redemption
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(160,000
|
)
|
|
|
(160
|
)
|
|
|
|
|
|
|
|
|
|
|
(159,840
|
)
|
|
|
160,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares at $50.00
|
|
|
370
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,496
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Preferred Shares
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
3,071,000
|
|
|
|
3,071
|
|
|
|
3,067,929
|
|
|
|
|
|
|
|
(2,825,000
|
)
|
|
|
-
|
|
|
|
|
|
|
|
246,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of Preferred Shares
to Common Shares
|
|
|
6,400,000
|
|
|
|
64,000
|
|
|
|
(1,000,000
|
)
|
|
|
(1,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(63,000
|
)
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares at $10.00
|
|
|
386,718
|
|
|
|
3,867
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,863,321
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,867,188
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Buyback of shares
|
|
|
(14,750
|
)
|
|
|
(148
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(208,952
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(209,099
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of shares for reverse split rounding
|
|
|
218
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of shares for consulting fee offset
|
|
|
5,000
|
|
|
|
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,495
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of Preferred Shares
to Common Shares
|
|
|
49,200
|
|
|
|
49
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(246,000
|
)
|
|
|
(246
|
)
|
|
|
197
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred Share Cancellation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,825,000
|
)
|
|
|
(2,825
|
)
|
|
|
(2,822,175
|
)
|
|
|
|
|
|
|
2,825,000
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
Dividends
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(35,517
|
)
|
|
|
-
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
(35,517
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(4,728,869
|
)
|
|
|
|
|
|
|
(4,728,869
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2016
|
|
|
9,714,186
|
|
|
$
|
2,233,182
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
-
|
|
|
$
|
-
|
|
|
$
|
29,698,025
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
(25,110,319
|
)
|
|
$
|
-
|
|
|
$
|
6,820,887
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of shares for OneMain tender offer
|
|
|
3,039,880
|
|
|
|
3,040
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,550,580
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,553,620
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized
loss on marketable securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(153,514
|
)
|
|
|
(153,514
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reclassified
adjustment for loss on marketable securities to net loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
153,514
|
|
|
|
153,514
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
Stock Dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(48,571
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(48,571
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(1,555,922
|
)
|
|
|
|
|
|
|
(1,555,922
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, June 30, 2017
|
|
|
12,754,066
|
|
|
$
|
2,236,222
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
-
|
|
|
$
|
-
|
|
|
|
-
|
|
|
$
|
-
|
|
|
$
|
33,200,034
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
(26,666,241
|
)
|
|
$
|
-
|
|
|
$
|
8,770,01
4
|
|
See
notes to condensed consolidated unaudited Financial Statements
IEG
HOLDINGS CORPORATION
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS
FOR
THE SIX MONTHS ENDED JUNE 30, 2017 AND 2016
|
|
June
30, 2017
|
|
|
June
30, 2016
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Net
loss
|
|
$
|
(1,555,922
|
)
|
|
$
|
(2,201,211
|
)
|
Adjustments
to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
Provision
for credit losses
|
|
|
619,324
|
|
|
|
742,437
|
|
Depreciation
and amortization
|
|
|
3,044
|
|
|
|
3,833
|
|
Loss
on marketable securities sold
|
|
|
153,514
|
|
|
|
-
|
|
Changes
in assets - (increase) decrease:
|
|
|
|
|
|
|
|
|
Other
receivables
|
|
|
24,371
|
|
|
|
(8,355
|
)
|
Prepaid
expenses
|
|
|
10,498
|
|
|
|
5,341
|
|
Deposits
|
|
|
-
|
|
|
|
4,875
|
|
Changes
in liabilities - increase (decrease):
|
|
|
|
|
|
|
|
|
Accounts
payable and accrued expenses
|
|
|
65,372
|
|
|
|
167,916
|
|
Deferred
rent
|
|
|
-
|
|
|
|
(8,239
|
)
|
|
|
|
|
|
|
|
|
|
NET
CASH USED IN OPERATING ACTIVITIES
|
|
|
(679,799
|
)
|
|
|
(1,293,403
|
)
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Sale
of marketable securities
|
|
|
3,400,106
|
|
|
|
-
|
|
Loans
receivable originated
|
|
|
(285,000
|
)
|
|
|
(2,320,000
|
)
|
Loans
receivable repaid
|
|
|
985,520
|
|
|
|
1,000,888
|
|
|
|
|
|
|
|
|
|
|
NET
CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
|
|
|
4,100,626
|
|
|
|
(1,319,112
|
)
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Preferred
dividends paid
|
|
|
-
|
|
|
|
(29,917
|
)
|
Payments
for buyback of common stock
|
|
|
-
|
|
|
|
(130,769
|
)
|
Proceeds
from issuance of preferred stock
|
|
|
-
|
|
|
|
90,550
|
|
Proceeds
from issuance of common stock
|
|
|
-
|
|
|
|
2,371,172
|
|
|
|
|
|
|
|
|
|
|
NET
CASH PROVIDED BY FINANCING ACTIVITIES
|
|
|
-
|
|
|
|
2,301,036
|
|
|
|
|
|
|
|
|
|
|
NET
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
|
|
3,420,827
|
|
|
|
(311,479
|
)
|
|
|
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS, BEGINNING OF YEAR
|
|
|
322,441
|
|
|
|
485,559
|
|
|
|
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS, END OF YEAR
|
|
$
|
3,743,268
|
|
|
$
|
174,080
|
|
|
|
|
|
|
|
|
|
|
Supplemental disclosures:
|
|
|
|
|
|
|
|
|
Interest
paid in cash
|
|
$
|
-
|
|
|
$
|
-
|
|
Income
taxes paid in cash
|
|
$
|
-
|
|
|
$
|
-
|
|
Issuance
of common stock for tender offer
|
|
$
|
3,553,620
|
|
|
$
|
-
|
|
Issuance
of common stock in lieu of consulting fees
|
|
$
|
-
|
|
|
$
|
107,000
|
|
See
notes to condensed consolidated unaudited Financial Statements
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General
The
quarterly report on Form 10-Q for the quarter ended June 30, 2017 should be read in conjunction with the Company’s
financial statements for the year ended December 31, 2016, contained in the Company’s annual report on Form 10-K for the
fiscal year ended December 31, 2016 as filed with the Securities and Exchange Commission (the “SEC”) on March 8, 2017.
As contemplated by the SEC under Article 8 of Regulation S-X, the accompanying financial statements and footnotes have been condensed
and therefore do not contain all disclosures required by generally accepted accounting principles (“GAAP”).
The interim financial data are unaudited, however in the opinion of IEG Holdings Corporation (“we, “our”, “us”)
the interim data includes all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of
results for the interim periods. Results of interim periods are not necessarily indicative of those to be expected for the full
year.
Nature
of Business
The
principal business activity of the Company is providing unsecured online consumer loans under the brand name “Mr. Amazing
Loans” via the Company’s website and online application portal at www.mramazingloans.com. The Company started its
business and opened its first office in Las Vegas, Nevada in 2010. The Company currently offers $5,000 and $10,000 unsecured consumer
loans that mature in five years. The Company is a direct lender with state licenses and/or certificates of authority in, and originating
direct consumer loans in, 20 states – Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana, Maryland,
Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, Virginia and Wisconsin. The Company provides
loans to residents of these states through its online application portal, with all loans originated, processed and serviced out
of its centralized Las Vegas head office, which eliminates the need for physical offices in all of these states.
Basis
of Accounting
These
consolidated financial statements include the operations of IEG Holdings Corporation and its wholly-owned subsidiaries, Investment
Evolution Corporation (“IEC”) and IEC SPV, LLC (“IEC SPV” and collectively with IEG Holdings
Corporation and IEC, the “Company”). All inter-company transactions and balances have been eliminated in consolidation.
The
Company’s accounting and reporting policies are in accordance with U.S. GAAP and conform to general practices within
the consumer finance industry.
The
consolidated financial statements have been prepared in conformity with GAAP . The accompanying consolidated financial statements
do not include any adjustments to reflect any possible future effects on the recoverability and classification of assets or the
amounts and classification of liabilities.
Liquidity
The
principal conditions/events that raise substantial doubt about the company’s ability to meet its obligations are i) the
Company has reported recurring losses and ii) the Company has not yet generated positive net cash flows from operations. However,
the Company has reduced its core operating expenses. In addition, cash in bank significantly increased during the quarter,
resulting from substantial positive net cash flows from investing activities. Management has evaluated the result of their plans
for the next 12 months and as a result of the plans, the Company can meet all its obligations at least through August 2018.
However, the Company intends, over the next 12 months, to seek additional capital to expand operations.
Use
of Estimates
The
preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions
that affect the reported amounts and disclosures. Management uses its historical records and knowledge of its business in making
these estimates. Accordingly, actual results may differ from these estimates.
Cash
and Cash Equivalents
For
the purpose of the statement of cash flows, the Company considers cash equivalents to include short-term, highly liquid investments
with an original maturity of three months or less.
Loans
Receivable and Interest Income
The
Company offers its loans at or below the prevailing statutory rates. Loans are carried at the unpaid principal amount outstanding,
net of an allowance for credit losses.
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
The
Company calculates interest revenue using the interest yield method. Charges for late payments are credited to income when collected.
Accrual
of interest income on loans receivable is suspended when no payment has been received on account for 91 days or more on a contractual
basis, at which time a loan is considered delinquent. Payments received on nonaccrual financing loans are first applied to the
unpaid accrued interest and then principal. Loans are returned to active status and accrual of interest income is resumed when
all of the principal and interest amounts contractually due are brought current; at which time management believes future payments
are reasonably assured. At June 30, 2017, 74 loans, with a total balance of $335,563 were delinquent or in
default.
Allowance
for Credit Losses
The
Company maintains an allowance for credit losses due to the fact that it is probable that a portion of the loans receivable will
not be collected. The allowance is estimated by management based on various factors, including specific circumstances of the individual
loans, management’s knowledge of the industry, and the experience and trends of other companies in the same industry.
Our
portfolio of loans receivable consists of a large number of relatively small, homogenous accounts. The allowance for credit losses
is determined using a systematic methodology, based on a combination of historical bad debt of comparable companies. Impaired
loans are considered separately and 100% charged off.
The
allowance for credit losses is primarily based upon models that analyze specific portfolio statistics and also reflect, management’s
judgment regarding overall accuracy. We take into account several factors, including the customer’s transaction history,
specifically the timeliness of customer payments, the remaining contractual term of the loan, and the outstanding balance of the
loan.
Impaired
Loans
The Company
assesses loans for impairment individually when a loan is 91 days past due. The Company defines impaired loans as bankrupt accounts
and accounts that are 184 days or more past due. In accordance with the Company’s charge-off policy, once a loan is deemed
uncollectible, 100% of the remaining balance is charged-off. Loans can also be charged off when deemed uncollectible due to consumer
specific circumstances.
The Company does not accrue
interest on impaired loans and any recoveries of impaired loans are recorded to the allowance for credit losses. Changes in the
allowance for credit losses are recorded as operating expenses in the accompanying statement of operations.
Property
and Equipment
Property
and equipment are stated at cost. Depreciation and amortization are being provided using the straight-line method over the estimated
useful lives of the assets as follows:
Classification
|
|
|
Life
|
|
Computer equipment
|
|
|
5
years
|
|
Furniture and fixtures
|
|
|
5-8
years
|
|
The
Company amortizes its leasehold improvements over the shorter of their economic lives, which are generally five years, or the
lease term that considers renewal periods that are reasonably assured. Expenses for repairs and maintenance are charged to expense
as incurred, while renewals and betterments are capitalized. When assets are retired or otherwise disposed of, the cost and accumulated
depreciation are removed from the accounts and any gain or loss is reflected in the consolidated statement of operations.
Operating
Lease
The Company’s
office lease for 6160 West Tropicana Avenue, Las Vegas , NV expires (and will not be renewed) on September
30, 2017.
Income
Taxes
We
account for income taxes using the liability method in accordance with the Financial Accounting Standards Board (“FASB”)
Accounting Standards Codification (“ASC”) 740 “Income Taxes”. To date, no current income tax liability
has been recorded due to our accumulated net losses. Deferred income tax assets and liabilities are recognized for temporary differences
between the financial statement carrying amounts of assets and liabilities and the amounts that are reported in the income tax
returns. Our net deferred income tax assets have been fully reserved by a valuation allowance due to the uncertainty of our ability
to realize future taxable income and to recover our net deferred income tax assets.
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
Advertising
Costs
Advertising
costs are expensed as incurred. Advertising costs amounted to $3,460 and $221,309 for the six months ended
June 30, 2017 and 2016, respectively. Advertising costs amounted to $2,580 and $173,485 for the three months ended June
30, 2017 and 2016, respectively.
Earnings
and Loss per Share
The
Company computes net earnings (loss) per share in accordance with ASC 260-10 that establishes standards for computing and presenting
net earnings (loss) per shares. Basic earnings (loss) per share are computed by dividing net income (loss) attributed to common
shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed
similar to basic earnings per share except that the denominator is increased to include the number of additional common shares
that would have been outstanding if the potential common shares, if any, had been issued and if the additional common shares were
dilutive. Basic and diluted loss per share has been adjusted retroactively for the net 1-for-10 reverse split that occurred on
October 27, 2016.
Reclassifications
Certain
numbers from the prior period have been reclassified to conform to the current year presentation.
Fair
Value of Financial Instruments
The
Company has adopted guidance issued by the FASB that defines fair value, establishes a framework for measuring fair value in accordance
with existing GAAP , and expands disclosures about fair value measurements. Assets and liabilities recorded at fair value
in the consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure
their fair value. The categories are as follows:
●
|
|
Level
I – Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date.
|
|
|
|
●
|
|
Level
II – Inputs, other than quoted prices included in Level I that are observable for the asset or liability through corroboration
with market data at the measurement date.
|
|
|
|
●
|
|
Level
III – Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing
the asset or liability at the measurement date.
|
The
following table summarizes fair value measurements by level at June 30, 2017 for assets and liabilities measured at fair
value on a recurring basis:
|
|
Level
I
|
|
|
Level
II
|
|
|
Level
III
|
|
|
Total
|
|
Cash
|
|
$
|
3,743,268
|
|
|
|
|
|
|
|
|
|
|
$
|
3,743,268
|
|
Loans receivable, net
|
|
$
|
|
|
|
|
|
|
|
|
5,055,063
|
|
|
$
|
5,055,063
|
|
The
following table summarizes fair value measurements by level at December 31, 2016 for assets and liabilities measured at fair value
on a recurring basis:
|
|
Level
I
|
|
|
Level
II
|
|
|
Level
III
|
|
|
Total
|
|
Cash
|
|
$
|
322,441
|
|
|
|
|
|
|
|
|
|
|
$
|
322,441
|
|
Loans receivable, net
|
|
$
|
|
|
|
|
|
|
|
|
6,374,908
|
|
|
$
|
6,374,908
|
|
Loans
receivable are carried net of the allowance for credit losses, which is estimated by applying historical loss rates of our portfolio
and of other companies’ portfolios in the same industry with recent default trends to the gross loans receivable balance.
The unobservable inputs used to calculate the fair value of these loans include historical loss rates, recent default trends and
estimated remaining loan terms. Therefore, the carrying value of the loans receivable approximates the fair value.
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
Carrying
amounts reported in the consolidated balance sheets for other receivables, accounts payable, and accrued expenses approximate
fair value because of their immediate or short-term nature. The fair value of borrowings is not considered to be significantly
different than its carrying amount because the stated rates for such debt reflect current market rates and conditions.
Marketable
Securities
On
June 16, 2017, we closed our tender offer to purchase shares of common stock of OneMain Holdings, Inc. (“OneMain”),
with 151,994 OneMain shares of common stock acquired (the cost of which was valued at an aggregate of $3.55 million based on the
closing price of shares of OneMain common stock of $23.38 on June 15, 2017) in exchange for 3,039,880 shares of our common stock.
The security was classified as available-for-sale and had an unrealized loss of $153,514 prior to the sale. On June 22, 2017,
we sold 100% of the 151,994 shares of OneMain common stock for $3.4 million in cash. At June 30, 2017 the marketable securities
balance was $0.
Loss
on Sale of Marketable Securities
The
Company sold securities classified as available for sale for net proceeds of $3,400,106 resulting in a loss on sale totaling $153,514
during the quarter ended June 30, 2017.
Other
Comprehensive Income
The
Company’s other comprehensive income consists of unrealized gains (losses) on securities classified as available for sale
that are recorded as an element of shareholder’s equity but are excluded from net income.
Recent
Accounting Pronouncements
Recently
Issued or Newly Adopted Accounting Standards
In
May 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-09,
Revenue from Contracts with Customers
.
The standard will eliminate the transaction and industry specific revenue recognition guidance under current U.S. GAAP and replace
it with a principle based approach for determining revenue recognition. ASU 2014-09 is effective for annual and interim periods
beginning after December 15, 2017. Early adoption is not permitted. The revenue recognition standard is required to be applied
retrospectively, including any combination of practical expedients as allowed in the standard. We are evaluating the impact, if
any, of the adoption of ASU 2014-09 to our financial statements and related disclosures. The Company has not yet selected a transition
method nor has it determined the effect of the standard on its ongoing financial reporting.
In
August 2014, the FASB issued ASU 2014 -15,
Presentation of Financial Statements—Going Concern (Subtopic 205-40):
Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern
. ASU 2014-15 changes to the disclosure
of uncertainties about an entity’s ability to continue as a going concern. These changes require an entity’s management
to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s
ability to continue as a going concern within one year after the date that financial statements are issued. Substantial doubt
is defined as an indication that it is probable that an entity will be unable to meet its obligations as they become due within
one year after the date that financial statements are issued. If management has concluded that substantial doubt exists, then
the following disclosures should be made in the financial statements: (i) principal conditions or events that raised the substantial
doubt, (ii) management’s evaluation of the significance of those conditions or events in relation to the entity’s
ability to meet its obligations, (iii) management’s plans that alleviated the initial substantial doubt or, if substantial
doubt was not alleviated, management’s plans that are intended to at least mitigate the conditions or events that raise
substantial doubt, and (iv) if the latter in (iii) is disclosed, an explicit statement that there is substantial doubt about the
entity’s ability to continue as a going concern. These changes became effective for the Company for the 2016 annual period.
Our adoption of these changes have no material impact on the consolidated financial statements.
In
November 2015, the FASB issued ASU No. 2015-17,
Income Taxes
(Topic 740). The amendments in ASU 2015-17 change the requirements
for the classification of deferred taxes on the balance sheet. Currently, GAAP requires an entity to separate deferred income
tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position. To simplify the
presentation of deferred income taxes, the amendments in this ASU require that deferred tax liabilities and assets be classified
as noncurrent in a classified statement of financial position. The pronouncement is effective for fiscal years and interim periods
within those fiscal years beginning after December 15, 2016. Adoption of these changes have no material impact on the consolidated
financial statements.
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
In
January 2016, the FASB issued ASU 2016-01,
Financial Instruments – Overall
(Subtopic 825-10): Recognition and Measurement
of Financial Assets and Financial Liabilities. The update intends to enhance the reporting model for financial instruments to
provide users of financial statements with more decision-useful information and addresses certain aspects of the recognition,
measurement, presentation, and disclosure of financial instruments. The new standard affects all entities that hold financial
assets or owe financial liabilities. For public business entities, the amendments in this Update are effective for fiscal years
beginning after December 15, 2017, including interim periods within those fiscal years. Management is evaluating the impact of
the adoption of these changes will have on the consolidated financial statements.
In
February 2016, the FASB issued ASU 2016-02,
Leases (Topic 842),
which supersedes existing guidance on accounting for leases
in “Leases (Topic 840)” and generally requires all leases to be recognized in the consolidated balance sheet. ASU
2016-02 is effective for annual and interim reporting periods beginning after December 15, 2018; early adoption is permitted.
The provisions of ASU 2016-02 are to be applied using a modified retrospective approach. The Company is currently evaluating the
impact of the adoption of this standard on its consolidated financial statements.
In
April 2016, the FASB issued AS 2016-10,
Revenue from Contracts with Customers (Topic 606)
, which amends certain aspects
of the Board’s new revenue standard, ASU 2014-09, Revenue from Contracts with Customers. The standard should be adopted
concurrently with adoption of ASU 2014-09 which is effective for annual and interim periods beginning after December 15, 2017.
Early adoption is permitted. The Company has not yet selected a transition method nor has it determined the effect of the standard
on its ongoing financial reporting.
2.
LOANS RECEIVABLE
Loans
receivable consisted of the following at June 30, 2017 and December 31, 2016:
|
|
June
30, 2017
|
|
|
December
31, 2016
|
|
Loans receivable
|
|
$
|
6,017,932
|
|
|
$
|
7,587,349
|
|
Allowance for
credit losses
|
|
$
|
(962,869
|
)
|
|
$
|
(1,212,441
|
)
|
Loans receivable, net
|
|
$
|
5,055,063
|
|
|
$
|
6,374,908
|
|
A reconciliation
of the allowance for credit losses consist of the following at June 30, 2017 and December 31, 2016:
|
|
June
30, 2017
|
|
|
December
31, 2016
|
|
Beginning balance, January
1
|
|
$
|
1,212,441
|
|
|
$
|
985,375
|
|
Provision for credit losses
|
|
$
|
619,324
|
|
|
$
|
1,865,362
|
|
Loans charged
off
|
|
$
|
(868,896
|
)
|
|
$
|
(1,638,296
|
)
|
Ending balance
|
|
$
|
962,869
|
|
|
$
|
1,212,441
|
|
Basis of assessment:
|
|
|
|
|
|
|
|
|
Individually
|
|
$
|
-
|
|
|
$
|
-
|
|
Collectively
|
|
$
|
962,869
|
|
|
$
|
1,212,441
|
|
The following
is an age analysis of past due receivables as of June 30, 2017 and December 31, 2016:
|
|
31-60
Days Past Due
|
|
|
61-90
Days Past Due
|
|
|
Greater
than 90 Days
|
|
|
Total
Past Due
|
|
|
Current
|
|
|
Total
Financing Receivables
|
|
|
Recorded
Investment > 90 Days and not Accruing
|
|
June 30,
2017
|
|
$
|
191,151
|
|
|
$
|
121,734
|
|
|
$
|
335,563
|
|
|
$
|
648,448
|
|
|
$
|
5,369,484
|
|
|
$
|
6,017,932
|
|
|
$
|
335,563
|
|
December 31, 2016
|
|
$
|
257,299
|
|
|
$
|
163,590
|
|
|
$
|
367,098
|
|
|
$
|
787,987
|
|
|
$
|
6,799,362
|
|
|
$
|
7,587,349
|
|
|
$
|
367,098
|
|
The
Company’s primary credit quality indicator is the customer’s Vantage credit score as determined by Experian on the
date of loan origination. The Company does not update the customer’s credit profile during the contractual term of the loan.
The
following is a summary of the loan receivable balance as of June 30, 2017 and December 31, 2016 by credit quality indicator:
Credit
Score
|
|
June
30, 2017
|
|
|
December
31, 2016
|
|
550-575
|
|
$
|
15,142
|
|
|
$
|
16,264
|
|
576-600
|
|
$
|
128,985
|
|
|
$
|
183,701
|
|
601-650
|
|
$
|
2,641,735
|
|
|
$
|
3,332,371
|
|
651-700
|
|
$
|
2,284,804
|
|
|
$
|
2,946,944
|
|
701-750
|
|
$
|
738,730
|
|
|
$
|
874,408
|
|
751-800
|
|
$
|
151,864
|
|
|
$
|
166,811
|
|
801-850
|
|
$
|
42,081
|
|
|
$
|
46,368
|
|
851-900
|
|
$
|
14,591
|
|
|
$
|
20,482
|
|
|
|
$
|
6,017,932
|
|
|
$
|
7,587,349
|
|
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
3.
PROPERTY AND EQUIPMENT
At June
30, 2017 and December 31, 2016, property and equipment consists of the following:
|
|
June
30, 2017
|
|
|
December
31, 2016
|
|
Computer equipment
|
|
$
|
99,556
|
|
|
$
|
99,556
|
|
Furniture and fixtures
|
|
|
21,303
|
|
|
|
21,303
|
|
Leasehold improvements
|
|
|
7,112
|
|
|
|
7,112
|
|
|
|
$
|
127,971
|
|
|
$
|
127,971
|
|
Less accumulated depreciation and amortization
|
|
|
111,693
|
|
|
|
108,649
|
|
Total
|
|
$
|
16,278
|
|
|
$
|
19,322
|
|
Depreciation
of property and equipment amounted to $3,044 and $3,833 during the six months ended June 30, 2017 and 2016, respectively. Depreciation
of property and equipment amounted to $1,471 and $1,917 during the three months ended June 30, 2017 and 2016, respectively.
Depreciation costs are included in the accompanying statements of operations in operating expenses.
4.
SENIOR DEBT
On
August 21, 2015, we, through certain of our wholly owned subsidiaries, repaid the entire balance of principal and accrued interest
under the Loan and Security Agreement, as amended (the “Loan Agreement”), among BFG Investment Holdings, LLC (“BFG”),
and certain of our wholly owned subsidiaries. As a result, there is currently no outstanding balance under the Loan Agreement.
However, the Loan Agreement continues in effect and we are subject to a net profit interest under which we are required to pay
BFG 20% of the “Net Profit” of its subsidiary, IEC SPV, until 10 years from the date the loan is repaid in full (August
2015). Net Profit is defined as the gross revenue less (i) interest paid on the loan, (ii) payments on any other debt incurred
as a result of refinancing the loan through a third party, as provided in the Loan Agreement, (iii) any costs, fees or commissions
paid on the existing credit facility, and (iv) charge-offs to bad debt resulting from consumer loans and reduced by servicing
fee. The Net Profit arrangement can be terminated by us upon a payment of $3,000,000 to BFG. Net profit interest for the six months
ended June 30, 2017 and 2016 were $0 and $58,885, respectively. All loans receivable of the Company were
pledged as collateral at June 30, 2017 for the fulfillment of the Net Profit calculation.
5. STOCKHOLDERS’
EQUITY
On
June 16, 2017, we closed our tender offer to purchase shares of common stock of OneMain Holdings, Inc. (“OneMain”),
with 151,994 OneMain shares of common stock acquired (valued at an aggregate of $3.55 million based on the closing price of shares
of OneMain common stock of $23.38 on June 15, 2017) in exchange for 3,039,880 shares of our common stock.
As
of June 30, 2017, the aggregate number of shares which the Company had the authority to issue is 350,000,000 shares, of
which 300,000,000 shares are common stock, par value $0.001 per share, and 50,000,000 shares are preferred stock, par value $0.001
per shares. At June 30, 2017, the Company had 12,754,066 shares of common stock issued and outstanding. The Board
of Directors is authorized at any time, and from time to time, to provide for the issuance of preferred stock in one or more series,
and to determine the designations, preferences, limitations and relative or other rights of the preferred stock or any series
thereof.
Common
Stock Dividends
Historically,
we have not paid any cash dividends on our common stock. In May 2017, we announced the declaration of a cash dividend of $0.005
per common share for the first quarter of 2017. The dividend is payable on August 21, 2017 to stockholders of record at the close
of business on June 5, 2017. We expect to pay ongoing dividends. Payment of future dividends on our common stock, if any, will
be at the discretion of our board of directors and will depend on, among other things, our results of operations, cash requirements
and surplus, financial condition, contractual restrictions and other factors that our board of directors may deem relevant. We
may determine to retain future earnings, if any, for reinvestment in the development and expansion of our business.
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
Series
H Preferred Stock
During
the six months ended June 30, 2017 and year ended December 31, 2016, the Company issued 0 and 3,071,000 of Series
H convertible preferred stock, respectively, with a par value of $0.001 per share. At June 30, 2017, no shares of Series
H convertible preferred stock were outstanding.
Description
of Series H Preferred Stock
Our
amended and restated articles of incorporation, as amended, authorize 10,000,000 shares of Series H preferred stock, of which
no shares are outstanding as of June 30, 2017. There are no sinking fund provisions applicable to our Series H preferred stock.
Ranking.
The Series H preferred stock ranks
pari passu
with any other series of preferred stock subsequently designated by IEG
Holdings and not designated as senior securities or subordinate to the Series H preferred stock.
Liquidation
Preference.
In the event of a liquidation or winding up of IEG Holdings, a holder of Series H preferred stock will be entitled
to receive $1.00 per share of Series H preferred stock.
Dividends.
The Series H Preferred Stock is not entitled to receive dividends.
Conversion.
Holders of Series H preferred shares have the following rights with respect to the conversion of Series H preferred shares
into shares of our common stock:
|
●
|
At
5:00 pm Eastern time on December 31, 2017, each and every share of Series H Preferred Stock issued and outstanding at such
time shall automatically and without further action of any holder thereof, convert into shares of the Corporation’s
Common Stock on the bases of one (1) share of Common Stock for each share of Series H Preferred Stock.
|
|
|
|
|
●
|
Promptly
after December 31, 2017, the Corporation shall deliver to each prior holder of Series H Preferred Stock whose shares have
been converted into shares of Common Stock as set forth in Section 6(A), a certificate representing the number of the Corporation’s
shares of Common Stock into which such Series H Preferred Stock has been converted.
|
|
|
|
|
●
|
In
the event that, prior to 5:00 p.m. on December 31, 2017, IEG Holdings completes any consolidation, merger, combination, statutory
share exchange or other transaction in which the shares of Common Stock are exchanged for or changed into other stock or securities,
money and/or any other property, then in any such case the Series H Preferred Stock shall at the same time be similarly exchanged
or changed into preferred shares of the surviving entity providing the holders of such preferred shares with (to the extent
possible) the same relative rights and preferences as the Series H Preferred Stock. For the avoidance of doubt, in the event
that any such consolidation, merger, combination, statutory share exchange or other transaction is completed after 5:00 p.m.
on December 31, 2017, the shares of Series H Preferred Stock shall have been converted into shares of Common Stock and as
such shall be exchanged for or changed into other stock or securities, money and/or any other property, as any other shares
of Common Stock.
|
Voting.
Except as provided in the immediately following sentence, Series H Preferred Stock shall have no right to vote on any matter
to come before the shareholders of IEG Holdings. The affirmative vote at a meeting duly called for such purpose or the written
consent without a meeting, of the holders of not less than fifty percent (50%) of the then outstanding Series H Preferred Stock,
shall be required for any change to IEG Holdings’ Articles of Incorporation which would amend, alter, change or repeal any
of the powers, designations, preferences and rights of the Series H Preferred Stock.
Redemption
and Call Rights.
The Series H Preferred Stock have no redemption or call rights.
6. CONCENTRATION
OF CREDIT RISK
The
Company’s portfolio of finance receivables is with consumers living throughout Alabama, Arizona, California, Florida, Georgia,
Illinois, Kentucky, Louisiana, Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah, Virginia
and Wisconsin and consequently, such consumers’ ability to honor their installment contracts may be affected by economic
conditions in these areas.
The
Company maintains cash at financial institutions which may, at times, exceed federally insured limits.
At
June 30, 2017, the Company had cash and cash equivalents exceeding insured limits by $3,241,560.
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
7. COMMITMENTS
AND CONTINGENCIES
Operating
Leases
The
Company renewed its operating facility lease effective October 1, 2016 under a non-cancelable operating lease that expires on
30 September 2017. Monthly rental payments under this lease are $4,693 plus a proportionate share of operating expenses. The Company
previously had leases for operating facilities in Florida, Illinois and Arizona all of which terminated during 2016. Total
rent expense for the six months ended June 30, 2017 and 2016 was $28,889 and $107,465 respectively. Total rent expense for
the three months ended June 30, 2017 and 2016 was $18,032 and $52,778 respectively. The Company is responsible
for certain operating expenses in connection with these leases.
Legal
Matters
From
time to time, the Company may be involved in legal proceedings in the normal course of its business. The Company is not involved
in any material legal proceedings at the present time.
Professional
Consulting Contract
The
Company has a professional consulting contract with its Chief Executive Officer (“CEO”), according to which, the Company
paid $0 and health insurance for the six months ended June 30, 2017. The Company is obligated to pay its CEO $1
annually plus health insurance, with a discretionary bonus to be determined by the Company’s Board on December 31, 2017.
There was no bonus approved or paid for the year ended December 31, 2016.
Regulatory
Requirements
State
statutes authorizing the Company’s products and services typically provide state agencies that regulate banks and financial
institutions with significant regulatory powers to administer and enforce the law. Under statutory authority, state regulators
have broad discretionary power and may impose new licensing requirements, interpret or enforce existing regulatory requirements
in different ways, or issue new administrative rules. In addition, when the staff of state regulatory bodies change, it is possible
that the interpretations of applicable laws and regulations may also change.
Net
Profit Interest
The
Company has a net profit interest agreement with its lender, under which the Company pays 20% of its subsidiary IEC SPV LLC’s
net profit to the lender (see note 4).
8.
RELATED PARTY TRANSACTIONS
Chief
Executive Officer
During
the six months ended June 30, 2017 and six months ended June 30, 2016 the Company incurred compensation expense to our Chief Executive
Officer under the Professional Consulting Contract of $0 and $500,000 respectively. During the six months ended June 30, 2017
the company accrued dividends payable in the amount of $34,500 for our Chief Executive Officer. Preferred dividends in the amount
of $29,917 were paid in cash to our Chief Executive Officer during the six months ended June 30, 2016. During the three months
ended June 30, 2017 and three months ended June 30, 2016 the Company incurred compensation expense to our Chief Executive Officer
under the Professional Consulting Contract of $0 and $250,000 respectively.
Chief
Operating Officer
During
the six months ended June 30, 2017 and six months ended June 30, 2016 the Company incurred compensation expense to our Chief Operating
Officer of $115,000. During the six months ended June 30, 2017 the company accrued dividends payable in the amount of $10 for
our Chief Operating Officer. During the three months ended June 30, 2017 and three months ended June 30, 2016 the Company incurred
compensation expense to our Chief Operating Officer of $61,923.
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
Consulting
Fees
During
the six months ended June 30, 2017 and six months ended June 30, 2016, the Company incurred director fees totaling $0 and $17,500,
respectively, to Matthew Banks, a former director of the Company.
During
the three months ended June 30, 2017 and three months ended June 30, 2016, the Company incurred director fees totaling $0 and
$9,000, respectively, to Matthew Banks, a former director of the Company.
During
the six months ended June 30, 2017 and six months ended June 30, 2016, the Company incurred director fees totaling $0 and $17,500,
respectively to R & H Nominees Pty Ltd, which is owned by Harold Hansen, a former director of the Company. During the three
months ended June 30, 2017 and three months ended June 30, 2016, the Company incurred director fees totaling $0 and $9,000, respectively
to R & H Nominees Pty Ltd, which is owned by Harold Hansen, a former director of the Company.
During
the six months ended June 30, 2017 and six months ended June 30, 2016, the Company incurred consulting fees totaling $0 and $87,204,
respectively, to Frank Wilkie and related parties. Frank Wilkie is a shareholder of IEG Holdings Corporation. During the three
months ended June 30, 2017 and three months ended June 30, 2016, the Company incurred consulting fees totaling $0 and $86,954,
respectively, to Frank Wilkie and related parties. Frank Wilkie is a shareholder of IEG Holdings Corporation.
During
the six months ended June 30, 2017 and six months ended June 30, 2016, the Company incurred consulting fees totaling $20,000 and
$0, respectively, to Clem Tacca and related parties. Clem Tacca is a shareholder of IEG Holdings Corporation. During the three
months ended June 30, 2017 and three months ended June 30, 2016, the Company incurred consulting fees totaling $20,000 and $0,
respectively, to Clem Tacca and related parties. Clem Tacca is a shareholder of IEG Holdings Corporation.
During
the six months ended June 30, 2017 and six months ended June 30, 2016, the Company incurred consulting fees totaling $30,000 and
$13,200, respectively, to Judith Willoughby and related parties. Judith Willoughby is a shareholder of IEG Holdings Corporation.
During the three months ended June 30, 2017 and three months ended June 30, 2016, the Company incurred consulting fees totaling
$30,000 and $13,200, respectively, to Judith Willoughby and related parties. Judith Willoughby is a shareholder of IEG Holdings
Corporation.
During
the six months ended June 30, 2017 and six months ended June 30, 2016, the Company incurred consulting fees totaling $0 and $68,886,
respectively, to Ascendant SC Pty Ltd. Ascendant SC Pty Ltd is a shareholder of IEG Holdings Corporation. During the three months
ended June 30, 2017 and three months ended June 30, 2016, the Company incurred consulting fees totaling $0 and $68,886, respectively,
to Ascendant SC Pty Ltd. $35,000 of the consulting fee incurred in 2016 were offset as consideration for Common Stock on May 2,
2016. Ascendant SC Pty Ltd is a shareholder of IEG Holdings Corporation.
During
the six months ended June 30, 2017 and six months ended June 30, 2016, the Company incurred consulting fees totaling $50,000 and
$0, respectively, to Worldwide Holdings LLC. Worldwide Holdings LLC is a shareholder of IEG Holdings Corporation. During the three
months ended June 30, 2017 and three months ended June 30, 2016, the Company incurred consulting fees totaling $50,000 and $0,
respectively, to Worldwide Holdings LLC. Worldwide Holdings LLC is a shareholder of IEG Holdings Corporation.
9.
SUBSEQUENT EVENTS
Declaration
of Dividend
On
August 1, 2017, our sole director declared a cash dividend of $0.005 per common share for the second quarter of 2017. The dividend
is payable on August 21, 2017 to stockholders of record at the close of business on August 11, 2017.
Mathieson
Consulting Contract
On
July 1, 2017, we and Mr. Mathieson agreed to terminate, effective July 1, 2017, the January 1, 2017 Consulting Contract. Also
on July 1, 2017, Investment Evolution Corporation, a wholly owned subsidiary of the Company (“IEC”), and Mr. Mathieson
entered into a professional consulting contract, effective July 1, 2017 (the “July 1, 2017 Consulting Contract”).
Pursuant to the terms of the July 1, 2017 Consulting Contract, Mr. Mathieson agreed to provide regulatory and management consulting
services as requested by the Company and/or IEC. The 2017 Consulting Contract has a term of 1.5 years and renews automatically
for one year periods unless notice of termination is provided 30 days prior to the automatic renewal date. In exchange for Mr.
Mathieson’s services, the Company agreed to pay Mr. Mathieson $1,200,000 annually and a discretionary bonus to be determined
by the Company’s board of directors.
LendingClub
Tender Offer
On
July 12, 2017, the Company filed a registration statement on Form S-4 (the “S-4 Registration Statement”) and a Schedule
TO relating to the Company’s offer to exchange four shares of the Company’s common stock for each share of common
stock of LendingClub Corporation (“Lending Club”), par value $0.01 per share, up to an aggregate of 40,345,603 shares
of Lending Club common stock, representing approximately 9.99% of Lending Club’s outstanding shares as of April 28, 2017,
validly tendered and not properly withdrawn in the offer (the “Lending Club Tender Offer”). The Lending Club Tender
Offer and the withdrawal rights were set to expire at 5:00 p.m., Eastern time, on August 10, 2017, unless extended.
Following
the launch of the Lending Club Tender Offer, the Company’s per share stock price, as quoted on the OTCQB, dropped significantly.
On August 1, 2017, due to the stock price drop, the Company determined that the Lending Club Tender Offer no longer had a reasonable
chance of success and accordingly, the Company determined that it would terminate the Lending Club Tender Offer and withdraw the
S-4 Registration Statement. Furthermore, the Company has no intention of launching the Lending Club Tender Offer or another tender
offer in the near future. Any shares that have been tendered by Lending Club stockholders have not yet been accepted and will
be returned to the relevant stockholders.
IEG
HOLDINGS CORPORATION
NOTES
TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
JUNE
30, 2017
Replacement
Las Vegas Office Lease
The
Company entered into a new lease on August 1, 2017 under a non-cancelable operating lease that begins October 1, 2017 and expires
September 30, 2020 for 3960 Howard Hughes Parkway, Las Vegas and will relocate from the current Las Vegas office in September
2017. Monthly rental payments under this lease are $5,794, and the Company will be responsible for its pro rata shares of operating
expenses and property taxes.
Abandonment
of Reverse-Forward Stock Split and Cash-Out
On
June 21, 2017, the Company filed with the Securities and Exchange Commission (the “Commission”) a preliminary information
statement on Schedule 14C (the “Preliminary Information Statement”). The Preliminary Information Statement, though
not in definitive form, related to a vote by the Company’s sole director and holder of a majority of the voting power of
the issued and outstanding capital stock of the Company to effect a reverse 1-for-1,000 stock split (the “Reverse Split”),
followed immediately by a forward 1,000-for-1 stock split (the “Forward Split”) of the Company’s common stock.
The Company’s intention was that registered shareholders whose shares of stock were converted into less than one share in
the Reverse Split would receive cash payments equal to the fair value of those fractional interests. The Reverse Split and Forward
Split, together with the related cash payments to shareholders with less than 1,000 shares of common stock prior to the Reverse
Split are referred to herein as the “Reverse/Forward Split.”
On
July 18, 2017, the Company determined that it will not effect the Reverse/Forward Split at this time. Furthermore, the Company
has no intention of effecting the Reverse/Forward Split or any other reverse and/or forward split in the near future. For avoidance
of doubt, no reverse and/or forward split occurred on July 25, 2017, as originally disclosed in the Preliminary Information Statement,
and no stockholders were cashed out on July 25, 2017. Stockholders should disregard the Preliminary Information Statement that
was filed with the Commission in its entirety.
The
Company’s determination to abandon the Reverse/Forward Split was based on the Company’s launch, on July 12, 2017,
of the Lending Club Tender Offer. The Company launched the Lending Club Tender Offer on July 12, 2017, subsequent to the filing
of the Preliminary Information Statement with the Commission on June 21, 2017. The primary goal of the Reverse/Forward Split was
cost savings from reducing administrative costs associated with reducing shareholder accounts. The Company expected that a significant
number of new shareholders may have been obtained in connection with the Lending Club Tender Offer, including those holding fewer
than 1,000 shares. As a result, the Company determined that any expected cost savings may no longer be sufficient to justify proceeding
with the Reverse/Forward Split. Although the Company determined, on August 1, 2017, that it would abandon the Lending Club Tender
Offer, the Company does not intend to effect the Reverse/Forward Split or any other reverse and/or forward split in the near future.
The Company notes that previously completed reverse/forward stock splits have achieved substantial administrative cost savings,
and have not been designed for the purpose of “going private”.
Amendment
of Series H Preferred Stock
On
July 26, 2017, we filed articles of amendment (the “Amendment”) to our amended and restated articles of incorporation,
as amended. The Amendment has the effect of revising the terms of the Series H preferred stock to increase the conversion ratio
of the Series H preferred stock from one share of Common Stock per share of Series H preferred stock to four shares of Common
Stock per share of Series H preferred stock. The Amendment was approved by our sole director on July 26, 2017.
IEG
HOLDINGS CORPORATION
9,089,220
Shares of
Common
Stock
PROSPECTUS
____________,
2017
Until
____________, 2017, all dealers that effect transactions in these securities, whether or not participating in this offering, may
be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting
as underwriters and with respect to their unsold allotments or subscriptions.
PART
II
INFORMATION
NOT REQUIRED IN THE PROSPECTUS
Item
13. Other Expenses of Issuance and Distribution
The
table below lists various expenses payable in connection with the sale and distribution of the securities being registered hereby.
All the expenses are estimates, except the Securities and Exchange Commission (“SEC”) registration fee. All such expenses
will be borne by the Company; none of the expenses will be borne by the selling stockholders.
Type
|
|
Amount
|
|
SEC Registration Fee
|
|
$
|
3,160
|
|
Printing Expenses
|
|
|
1,000
|
|
Legal Fees and Expenses
|
|
|
5,000
|
|
Accounting Fees
and Expenses
|
|
|
19,976
|
|
Total Expenses
|
|
$
|
29,136
|
|
Item
14. Indemnification of Directors and Officers
The
Florida Business Corporation Act allows us to indemnify any person made a party to any lawsuit by reason of being a director or
officer of the Company, or serving at the request of the corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.
Our
amended and restated articles of incorporation, as amended, provide that our directors and officers shall be indemnified and the
Company shall advance expenses on behalf of its officers and directors to the fullest extent not prohibited by law either now
or hereafter.
Our
amended and restated bylaws require us to indemnify directors and officers against, to the fullest extent permitted by law, liabilities
which they may incur under the circumstances described above.
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC, such indemnification
is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
Item
15. Recent Sales of Unregistered Securities
The
following is a summary of transactions by us within the past three years involving sales or our securities that were not registered
under the Securities Act. Numbers of shares and exercise prices have been adjusted to reflect the 1-for-100 reverse split of the
Company’s common stock effected on June 17, 2015 and the net 1-for-10 reverse split effected on October 27, 2016.
On
March 31, 2014, the Company issued 1,000,000 shares of Series A convertible preferred stock to the Company’s President and
Chief Executive Officer, Mr. Mathieson, in consideration for $1,000,000. Also on March 31, 2014, the Company issued an aggregate
of 410,000 shares of Series B convertible preferred stock to four accredited investors, for an aggregate purchase price of $410,000.
In addition, on March 31, 2014, the Company issued an aggregate of 400,025 shares of Series C convertible preferred stock to five
accredited investors, for an aggregate purchase price of $400,025. The Company also issued an aggregate of 173,000 shares of Series
D convertible preferred stock to 14 accredited investors on March 31, 2014, for an aggregate purchase price of $173,000. All of
these securities were issued in reliance upon the exemptions provided by Section 4(a)(2) and Section 2(a)(3), as applicable, and
Regulation S under the Securities Act.
During
the quarter ended June 30, 2014, the Company issued 611,991 shares of its common stock at a price of $5.00 per share in a private
placement to existing stockholders of the Company who were accredited investors or who were not “U.S. Persons” as
defined in the Securities Act. The securities were issued in reliance upon the exemptions provided by Section 4(a)(2) and Section
2(a)(3) or Regulation S, as applicable under the Securities Act.
On
November 19, 2014, the Company issued an aggregate of 461,000 shares of Series E preferred stock to nine accredited investors.
Also on November 19, 2014, the Company issued an aggregate of 1,400,000 shares of Series F preferred stock 24 accredited investors.
All of these securities were issued in reliance upon the exemptions provided by Section 4(a)(2) and Section 2(a)(3), as applicable
under the Securities Act.
During
the six months ended December 31, 2014, the Company issued 303,884 shares of common stock at a price of $10.00, $15.00 and $20.00
per share in private placements to existing stockholders of the Company who were accredited investors or who were not “U.S.
Persons” as defined in the Securities Act. The securities were issued in reliance upon the exemptions from registration
provided by Regulation D, Rule 506 and Rule 506(b) and Regulation S as promulgated by the SEC under the Securities Act.
Effective
December 31, 2014, all holders of the then-outstanding Series B preferred stock provided notice to us of their intent to convert,
pursuant to the terms of the Series B preferred stock, all of their Series B preferred shares into shares of our common stock
on the basis of 0.4 shares of common stock for each share of Series B preferred stock so converted. Accordingly, on December 31,
2014, we issued an aggregate of 164,000 shares of common stock to the holders of our Series B preferred stock in exchange for
all shares of their Series B preferred stock. The shares of common stock were issued in reliance upon the exemptions provided
by Section 3(a)(9) of the Securities Act.
Effective
December 31, 2014, all holders of the then-outstanding Series C preferred stock provided notice to us of their intent to convert,
pursuant to the terms of the Series C preferred stock, all of their Series C preferred shares into shares of our common stock
on the basis of 0.2 shares of common stock for each share of Series C preferred stock so converted. Accordingly, on December 31,
2014, we issued an aggregate of 80,005 shares of common stock to the holders of our Series C preferred stock in exchange for all
shares of their Series C preferred stock. The shares of common stock were issued in reliance upon the exemptions provided by Section
3(a)(9) of the Securities Act.
Effective
December 31, 2014, all holders of the then-outstanding Series D preferred stock provided notice to us of their intent to convert,
pursuant to the terms of the Series D preferred stock, all of their Series D preferred shares into shares of our common stock
on the basis of 0.1333333 shares of common stock for each share of Series D preferred stock so converted. Accordingly, on December
31, 2014, we issued an aggregate of 23,067 shares of common stock to the holders of our Series D preferred stock in exchange for
all shares of their Series D preferred stock. The shares of common stock were issued in reliance upon the exemptions provided
by Section 3(a)(9) of the Securities Act.
Effective December 31, 2014,
all holders of the then-outstanding Series E preferred stock provided notice to us of their intent to convert, pursuant to the
terms of the Series E preferred stock, all of their Series E preferred shares into shares of our common stock on the basis of
0.040 shares of common stock for each share of Series E preferred stock so converted. Accordingly, on December 31, 2014, we issued
an aggregate of 18,440 shares of common stock to the holders of our Series E preferred stock in exchange for all shares of their
Series E preferred stock. The shares of common stock were issued in reliance upon the exemptions provided by Section 3(a)(9) of
the Securities Act.
On
June 17, 2015, the Company issued an aggregate of 600,000 shares of Series F convertible preferred stock to a total of 25 investors,
24 of whom resided in Australia and one of whom resided in the United Kingdom, in consideration for receipt of $1.00 per share,
representing an aggregate purchase price of $600,000. These securities were issued in reliance upon the exemptions provided by
Regulation S promulgated pursuant to the Securities Act. No offering circular was used in connection with this issuance.
On
June 22, 2015, the Company issued an aggregate of 5,419,500 shares of Series G convertible preferred stock to a total of 92 investors,
90 of whom resided in Australia and two of whom resided in the United Kingdom, in consideration for receipt of $1.00 per share,
representing an aggregate purchase price of $5,419,500. These securities were issued in reliance upon the exemptions provided
by Regulation S promulgated pursuant to the Securities Act. No offering circular was used in connection with this issuance.
Effective
June 30, 2015, 20 holders of an aggregate of 1,750,000 shares of Series F preferred stock provided notice to us of their intent
to convert, pursuant to the terms of the Series F preferred stock, their Series F preferred shares into shares of our common stock
on the basis of 0.03636 shares of our common stock for each share of Series F preferred stock so converted. Accordingly, on June
30, 2015, we issued an aggregate of 63,540 shares of common stock to the 20 Series F holders, 19 of whom resided in Australia
and one of whom resided in the United Kingdom, in exchange for an aggregate of 1,750,000 shares of Series F preferred stock held
by such Series F holders. The shares of common stock were issued in reliance upon the exemptions provided by Regulation S promulgated
pursuant to the Securities Act. The issuances involved offers and sales of securities outside the United States. The offers and
sales were made in offshore transactions and no directed selling efforts were made by the issuer, a distributor, their affiliates
or any persons acting on their behalf. No offering circular was used in connection with this issuance.
Effective
June 30, 2015, 72 holders of an aggregate of 4,459,500 shares of Series G preferred stock provided notice to us of their intent
to convert, pursuant to the terms of the Series G preferred stock, their Series G preferred shares into shares of our common stock
on the basis of 0.02105 shares of our common stock for each share of Series G preferred stock so converted. Accordingly, on June
30, 2015, we issued an aggregate of 93,873 shares of common stock to the 72 Series G holders, 70 of whom resided in Australia,
one of whom resided in the United Kingdom and one of whom resided in Singapore, in exchange for an aggregate of 4,459,500 shares
of Series G preferred stock held by such Series G holders. The shares of common stock were issued in reliance upon the exemptions
provided by Regulation S promulgated pursuant to the Securities Act. The issuances involved offers and sales of securities outside
the United States. The offers and sales were made in offshore transactions and no directed selling efforts were made by the issuer,
a distributor, their affiliates or any persons acting on their behalf. No offering circular was used in connection with this issuance.
Also
on June 30, 2015, the Company issued 250,000 shares of the Company’s Series G preferred stock to Bruce Merivale-Austin,
a resident of Singapore, for a purchase price of $1.00 per share, representing an aggregate purchase price of $250,000. These
securities were issued in reliance upon the exemption from registration provided by Regulation S promulgated pursuant to the Securities
Act. No offering circular was used in connection with this issuance.
On
September 2, 2015, the Company issued an aggregate of 432,609 shares of the Company’s common stock to a total of 199 existing
stockholders, 197 of whom resided in Australia and two of whom resided in the United Kingdom, in consideration for receipt of
$10.00 per share, representing an aggregate purchase price of $4,326,086. The shares of common stock were issued in reliance upon
the exemptions provided by Regulation S promulgated pursuant to the Securities Act. The issuances involved offers and sales of
securities outside the United States. The offers and sales were made in offshore transactions and no directed selling efforts
were made by the issuer, a distributor, their affiliates or any persons acting on their behalf. An offering circular was used
in connection with this issuance.
On
October 22, 2015, the Company issued 160,000 shares of Series H convertible preferred stock to a total of three investors, each
of whom resided in Australia, in consideration for receipt of $1.00 per share, representing an aggregate purchase price of $160,000.
These securities were issued in reliance upon the exemptions provided by Regulation S promulgated pursuant to the Securities Act.
The issuances involved offers and sales of securities outside the United States. The offers and sales were made in offshore transactions
and no directed selling efforts were made by the issuer, a distributor, their affiliates or any persons acting on their behalf.
No offering circular was used in connection with this issuance.
On
December 31, 2015, the Company issued an aggregate of 13,438 shares of the Company’s common stock at a price of $50.00 per
share to a total of 29 existing stockholders, each of whom resided in Australia, for receipt of an aggregate of $671,890. These
securities were issued in reliance upon the exemptions provided by Regulation S promulgated pursuant to the Securities Act. The
issuances involved offers and sales of securities outside the United States. The offers and sales were made in offshore transactions
and no directed selling efforts were made by the issuer, a distributor, their affiliates or any persons acting on their behalf.
An offering circular was used in connection with this issuance.
Also on December 31, 2015,
all of the holders of shares of the Company’s Series F preferred stock notified the Company of their intention to convert
their Series F preferred stock into Company common stock pursuant to the terms of the Series F preferred stock. The Company issued
an aggregate of 33,330 shares of Company common stock to a total of five stockholders, each of whom resided in Australia, pursuant
to the conversion notices. These securities were issued in reliance upon the exemptions provided by Regulation S promulgated pursuant
to the Securities Act. The issuances involved offers and sales of securities outside the United States. The offers and sales were
made in offshore transactions and no directed selling efforts were made by the issuer, a distributor, their affiliates or any
persons acting on their behalf. No offering circular was used in connection with this issuance.
Following
the conversions, no shares of Series F preferred stock were outstanding.
Also
on December 31, 2015, the holders of an aggregate of 1,050,000 shares of the Company’s Series G preferred stock notified
the Company of their intention to convert their Series G preferred stock into Company common stock pursuant to the terms of the
Series G preferred stock. The Company issued an aggregate of 84,000 shares of Company common stock to a total of 21 stockholders,
20 of whom resided in Australia and one of whom resided in the United Kingdom, pursuant to the conversion notices. These securities
were issued in reliance upon the exemptions provided by Regulation S promulgated pursuant to the Securities Act. The issuances
involved offers and sales of securities outside the United States. The offers and sales were made in offshore transactions and
no directed selling efforts were made by the issuer, a distributor, their affiliates or any persons acting on their behalf. No
offering circular was used in connection with this issuance.
Following
the conversions, 160,000 shares of Series G preferred stock were outstanding.
Also
on December 31, 2015, all of the holders of the Company’s Series H preferred stock notified the Company of their intention
to convert their Series H preferred stock into Company common stock pursuant to the terms of the Series H preferred stock. The
Company issued an aggregate of 8,531 shares of Company common stock to a total of three stockholders, each of whom resided in
Australia, pursuant to the conversion notices. These securities were issued in reliance upon the exemptions provided by Regulation
S promulgated pursuant to the Securities Act. The issuances involved offers and sales of securities outside the United States.
The offers and sales were made in offshore transactions and no directed selling efforts were made by the issuer, a distributor,
their affiliates or any persons acting on their behalf. No offering circular was used in connection with this issuance. Following
the conversions, no shares of Series H preferred stock were outstanding.
On
January 1, 2016, pursuant to the terms of the Company’s Series G preferred stock, the Company exercised its right to redeem
all of the unconverted outstanding shares of Series G preferred stock. On December 24, 2015, the Company early paid the holders
of the 160,000 unconverted shares of Series G preferred stock an aggregate of $160,000. Following the redemption of the unconverted
shares of Series G preferred stock, no shares of Series G preferred stock were outstanding.
On
January 22, 2016, the Company issued an aggregate of 370 shares of the Company’s common stock at a price of $50.00 per share
to a total of two existing stockholders, each of whom resided in Australia, for receipt of an aggregate of $18,500. These securities
were issued in reliance upon the exemptions provided by Regulation S promulgated pursuant to the Securities Act. The issuances
involved offers and sales of securities outside the United States. The offers and sales were made in offshore transactions and
no directed selling efforts were made by the issuer, a distributor, their affiliates or any persons acting on their behalf. An
offering circular was used in connection with this offering.
On
March 22, 2016, the Company issued an aggregate of 3,071,000 shares of the Company’s Series H preferred stock to a total
of 12 existing stockholders, nine of whom resided in Australia and three of whom resided in the United Kingdom, in exchange for
the receipt of $1.00 per share, representing an aggregate purchase price of $3,071,000. These securities were issued in reliance
upon the exemptions provided by Regulation S promulgated pursuant to the Securities Act. The issuances involved offers and sales
of securities outside the United States. The offers and sales were made in offshore transactions and no directed selling efforts
were made by the issuer, a distributor, their affiliates or any persons acting on their behalf. No offering circular was used
in connection with this issuance.
On
March 31, 2016, Paul Mathieson, the Company’s Chief Executive Officer and the sole holder of the Company’s Series
A preferred stock notified the Company of his intention to convert all of his Series A preferred stock into Company common stock
pursuant to the terms of the Series A preferred stock. The Company issued an aggregate of 6,400,000 shares of Company common stock
pursuant to the conversion notice. These securities were issued in reliance upon the exemptions provided by Regulation S promulgated
pursuant to the Securities Act. The issuance involved offers and sales of securities outside the United States. The offers and
sales were made in offshore transactions and no directed selling efforts were made by the issuer, a distributor, their affiliates
or any persons acting on their behalf. No offering circular was used in connection with this issuance. Following the conversion,
no shares of Series A preferred stock were outstanding.
On
April 12, 2016, the Company issued an aggregate of 2,000 shares of the Company’s common stock to MZ Group, its investor
relations advisor. The securities issuance was exempt from registration under the Securities Act in reliance on the exemptions
provided by Section 4(a)(2) and Section 2(a)(3), as applicable under the Securities Act.
On May 2, 2016, Company issued
an aggregate of 243,967 shares of the Company’s common stock at a price of $10.00 per share to a total of 98 existing stockholders,
all of whom resided in Australia, for receipt of an aggregate of $2,439,673. The securities issuances were exempt from registration
under the Securities Act, in reliance on an exemption provided by Regulation S promulgated pursuant to the Securities Act. The
issuances involved offers and sales of securities outside the United States. The offers and sales were made in offshore transactions
and no directed selling efforts were made by the issuer, a distributor, their affiliates or any persons acting on their behalf.
An offering circular was used in connection with this offering.
On
September 6, 2016, the Company issued an aggregate of 5,000 shares of the Company’s common stock to MZ Group for investor
relations consulting services. The securities issuance was exempt from registration under the Securities Act, in reliance on the
exemptions provided by Section 4(a)(2) and Section 2(a)(3), as applicable under the Securities Act.
On
September 6, 2016, Company issued an aggregate of 135,751 shares of the Company’s common stock at a price of $10.00 per
share to a total of 84 existing stockholders, 48 of whom resided in Australia and 36 of whom resided in United States, for an
aggregate of $1,357,515. The securities issuances were registered pursuant to a registration statement on Form S-1 that was declared
effective by the Securities and Exchange Commission on August 8, 2016.
On December 31, 2016, pursuant
to the terms of the Company’s Series H preferred stock, holders of an aggregate of 246,000 Series H preferred shares exercised
their rights to convert their Series H preferred shares into 49,200 shares of the Company’s common stock. Also on December
31, 2016, following such conversions, the Company exercised its right to redeem all of the unconverted outstanding shares of Series
H preferred stock. As a result, the Company redeemed an aggregate of 2,825,000 shares of Series H preferred stock for an aggregate
amount of $2,825,000. These securities were issued in reliance upon the exemptions provided by Regulation S promulgated pursuant
to the Securities Act.
The issuance involved offers and
sales of securities outside the United States. The offers and sales were made in offshore transactions and no directed selling
efforts were made by the issuer, a distributor, their affiliates or any persons acting on their behalf. No offering circular was
used in connection with this issuance. Following the conversion, no shares of Series H preferred stock were outstanding. Following
the redemption of the unconverted shares of Series H preferred stock, no shares of Series H preferred stock were outstanding.
Item
16. Exhibits and Financial Statement Schedules
(a)
Exhibits.
See
the Exhibit Index on the page immediately preceding the exhibits for a list of exhibits filed as part of this post-effective amendment
to registration statement on Form S-1, which Exhibit Index is incorporated herein by reference.
(b)
Financial Statement Schedules.
None.
Item
17. Undertakings
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the
SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will
be governed by the final adjudication of such issue.
(a)
|
Rule
415 Offering. The undersigned registrant hereby undertakes:
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|
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(1)
|
To
file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
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(i)
|
To
include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
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(ii)
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To
reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information
set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low
or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate
offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement.
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(iii)
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To
include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement;
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(2)
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That,
for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
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(3)
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To
remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold
at the termination of the offering.
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SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of Las Vegas, State of Nevada, on August 14, 2017.
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IEG
Holdings Corporation
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By:
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/s/
Paul Mathieson
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Paul
Mathieson,
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President
and Chief Executive Officer
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Pursuant
to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the
capacities indicated on August 14, 2017
.
Name
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Title
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/s/
Paul Mathieson
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President,
Chief Executive Officer, Chief Financial Officer
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Paul
Mathieson
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(Principal
Executive Officer and Principal Financial and Accounting Officer) and Director
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EXHIBIT
INDEX
2.1
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Stock Exchange Agreement
among Investment Evolution Global Corporation, IEG Holdings Limited and Ideal Accents, Inc. dated as of January 28, 2013 (incorporated
by reference to Exhibit 2.1 to the registrant’s registration statement on Form S-1 filed with the Commission on December
12, 2014).
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3.1
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Amended and Restated
Articles of Incorporation of IEG Holdings Corporation dated February 22, 2013 (incorporated by reference to Exhibit 3.1 to
the registrant’s registration statement on Form S-1 filed with the Commission on December 12, 2014).
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3.2
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Articles of Amendment
to Amended and Restated Articles of Incorporation of IEG Holdings Corporation dated March 20, 2014 (incorporated by reference
to Exhibit 3.2 to the registrant’s registration statement on Form S-1 filed with the Commission on December 12, 2014).
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3.3
|
Articles of Amendment
to Amended and Restated Articles of Incorporation of IEG Holdings Corporation dated October 27, 2014 (incorporated by reference
to Exhibit 3.3 to the registrant’s registration statement on Form S-1 filed with the Commission on December 12, 2014).
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3.4
|
Articles of Amendment
to Amended and Restated Articles of Incorporation of IEG Holdings Corporation dated April 30, 2015 (incorporated by reference
to Exhibit 3.1 to the registrant’s current report on Form 8-K filed with the Commission on May 8, 2015).
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3.5
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Articles of Amendment
to Amended and Restated Articles of Incorporation of IEG Holdings Corporation dated June 17, 2015 (incorporated by reference
to Exhibit 3.1 to the registrant’s current report on Form 8-K filed with the Commission on June 18, 2015).
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3.6
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Articles of Amendment
effective September 10, 2015 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K
filed with the Commission on September 15, 2015).
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|
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3.7
|
Articles of Amendment
effective December 1, 2015 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K
filed with the Commission on December 4, 2015).
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|
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3.8
|
Articles of Amendment
effective January 8, 2016 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed
with the Commission on January 14, 2016).
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|
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3.9
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Articles of Amendment
effective March 22, 2016 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed
with the Commission on March 28, 2016).
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3.10
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Articles of Amendment
effective April 1, 2016 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed
with the Commission on February 23, 2016).
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|
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3.11
|
Articles of Amendment
effective April 1, 2016 (incorporated by reference to Exhibit 3.2 to the registrant’s current report on Form 8-K filed
with the Commission on February 23, 2016).
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|
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3.12
|
Articles of Amendment
effective May 16, 2016 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed
with the Commission on May 20, 2016).
|
|
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3.13
|
Articles of Amendment
effective October 27, 2016 (incorporated by reference to Exhibit 3.1 to the registrant’s quarterly report on Form 10-Q
filed with the Commission on October 27, 2016).
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|
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3.14
|
Articles of Amendment
effective October 27, 2016 (incorporated by reference to Exhibit 3.2 to the registrant’s quarterly report on Form 10-Q
filed with the Commission on October 27, 2016).
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|
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3.15
|
Articles of Amendment
effective December 5, 2016 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K
filed with the Commission on December 5, 2016).
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|
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3.16
|
Articles of Amendment
effective June 20, 2017 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed
with the Commission on June 21, 2017).
|
|
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3.17
|
Articles of Amendment
effective July 25, 2017 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed
with the Commission on June 22, 2017).
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|
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3.18
|
Articles of Amendment
effective July 25, 2017 (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed
with the Commission on June 22, 2017).
|
|
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3.19
|
Articles
of Amendment to Amended and Restated Articles of Incorporation, as amended (incorporated by reference to Exhibit 3.1 to the
registrant’s quarterly report on Form 10-Q for the quarter ended June 30, 2017).
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|
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3.19
|
Amended and Restated
Bylaws (incorporated by reference to Exhibit 3.4 to Amendment No. 2 to the registrant’s registration statement on Form
S-1 filed with the Commission on April 9, 2015).
|
|
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4.1
|
Form of Stock Certificate
(incorporated by reference to Exhibit 2.1 to the registrant’s registration statement on Form S-1 filed with the Commission
on December 12, 2014).
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5.1*
|
Opinion of the Law
Office of Legal & Compliance, LLC.
|
|
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10.1
|
Loan and Security
Agreement between IEC SPV, LLC and BFG Loan Holdings, LLC dated June 11, 2012 (incorporated by reference to Exhibit 10.1 to
the registrant’s registration statement on Form S-1 filed with the Commission on December 12, 2014).
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|
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10.2
|
Promissory Note
by IEC SPV, LLC in favor of BFG Loan Holdings, LLC dated June 11, 2012 (incorporated by reference to Exhibit 10.2 to the registrant’s
registration statement on Form S-1 filed with the Commission on December 12, 2014).
|
|
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10.3
|
Amended and Restated
Promissory Note by IEC SPV, LLC in favor of BFG Loan Holdings, LLC dated as of November 12, 2013 (incorporated by reference
to Exhibit 10.3 to the registrant’s registration statement on Form S-1 filed with the Commission on December 12, 2014).
|
|
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10.4
|
First Amendment
to Loan and Security Agreement between IEC SPV, LLC and BFG Loan Holdings, LLC dated November 12, 2013 (incorporated by reference
to Exhibit 10.4 to the registrant’s registration statement on Form S-1 filed with the Commission on December 12, 2014).
|
|
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10.5
|
Second Amendment
to Loan and Security Agreement by and between BFG Investment Holdings, LLC, IEC SPV, LLC, Investment Evolution Global Corporation,
Investment Evolution Corporation and Paul J. Mathieson dated as of June 30, 2014 (incorporated by reference to Exhibit 10.5
to the registrant’s registration statement on Form S-1 filed with the Commission on December 12, 2014).
|
|
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10.6
|
Services Agreement
between CyberRidge, LLC and Investment Evolution Corporation dated as of March 28, 2012 (incorporated by reference to Exhibit
10.7 to Amendment No. 2 to the registrant’s registration statement on Form S-1 filed with the Commission on April 9,
2015).
|
|
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10.7+
|
Professional Consulting
Contract, dated September 30, 2015 but effective as of January 1, 2015, by and between IEG Holdings Corporation and Paul Mathieson
(incorporated by reference to Exhibit 10.8 to the registrant’s quarterly report on Form 10-Q filed with the Commission
on October 30, 2015).
|
|
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10.8+
|
Professional Consulting
Contract, dated September 30, 2014 but effective as of January 1, 2014, by and between Investment Evolution Global Corporation
and Paul Mathieson (incorporated by reference to Exhibit 10.9 to the registrant’s quarterly report on Form 10-Q filed
with the Commission on October 30, 2015).
|
|
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10.9+
|
Professional Consulting
Contract effective January 1, 2017 between Investment Evolution Corporation and Paul Mathieson (incorporated by reference
to Exhibit 10.1 to the registrant’s current report on Form 8-K filed with the Commission on November 3, 2016).
|
|
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10.10+
|
Professional
Consulting Contract dated July 1, 2017 by and between Investment Evolution Corporation and Paul Mathieson (filed as Exhibit
10.1 to the registrant’s Current Report on Form 8-K filed with the Commission on July 3, 2017).
|
|
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21.1
|
List of Subsidiaries
(incorporated by reference to Exhibit 21.1 to Amendment No. 1 to the registrant’s registration statement on Form S-1/A
(File No. 333- 209116) filed with the Commission on February 22, 2016).
|
|
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23.1*
|
Consent of Independent
Registered Public Accounting Firm.
|
|
|
23.2
|
Consent of the Law
Office of Legal & Compliance, LLC (included in Exhibit 5.1).
|
|
|
101.INS*
|
XBRL Instance
|
|
|
101.SCH*
|
XBRL Taxonomy Extension
Schema
|
|
|
101.CAL*
|
XBRL Taxonomy Extension
Calculation
|
|
|
101.DEF*
|
XBRL Taxonomy Extension
Definition
|
|
|
101.LAB*
|
XBRL Taxonomy Extension
Labels
|
|
|
101.PRE*
|
XBRL Taxonomy Extension
Presentation
|