UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 12b-25
NOTIFICATION OF LATE FILING
| SEC FILE NUMBER: 000-51569 | |
| CUSIP NUMBER: 28201T203 | |
☐ Form 10-K ☐ Form 20-F ☐ Form 11-K
☒ Form 10-Q ☐ Form 10-D ☐ Form N-SAR ☐ Form N-CSR
For Period Ended: September 30, 2015
| ☐ | Transition Report on Form 10-K |
| ☐ | Transition Report on Form 20-F |
| ☐ | Transition Report on Form 11-K |
| ☐ | Transition Report on Form 10-Q |
| ☐ | Transition Report on Form N-SAR |
For the Transition Period Ended:
Nothing in this form shall be construed to imply that the Commission has verified any information contained herein. |
If the notification relates to a portion of the filing checked above, identify the Item(s) to which the notification relates:
PART I — REGISTRANT INFORMATION
EFACTOR GROUP CORP.
Full Name of Registrant
Former Name if Applicable
1177 Avenue of the Americas, Suite 5060
Address of Principal Executive Office (Street and Number)
New York, New York 10036
City, State and Zip Code
PART II — RULES 12b-25(b) AND (c)
If the subject report could not be filed without unreasonable effort or expense and the registrant seeks relief pursuant to Rule 12b-25(b), the following should be completed. (Check box if appropriate)
| (a) | The reason described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense | |
| ☒ | (b) | The subject annual report, semi-annual report, transition report on Form 10-K, Form 20-F, Form 11-K, Form N-SAR or Form N-CSR, or portion thereof, will be filed on or before the fifteenth calendar day following the prescribed due date; or the subject quarterly report or transition report on Form 10-Q or subject distribution report on Form 10-D, or portion thereof, will be filed on or before the fifth calendar day following the prescribed due date; and |
| (c) | The accountant's statement or other exhibit required by Rule 12b-25(c) has been attached if applicable. |
PART III — NARRATIVE
State below in reasonable detail why Forms 10-K, 20-F, 11-K, 10-Q,10-D, N-SAR, N-CSR, or the transition report or portion thereof, could not be filed within the prescribed time period.
The Company was unable, without unreasonable effort or expense, to file its Quarterly Report on Form 10-Q for the period ended September 30, 2015 (“Form 10-Q”) by the applicable due date. The Company requires additional time to gather information and finalize its financial statements. The Company expects to file the Form 10-Q within the additional time allowed by this report.
PART IV — OTHER INFORMATION
| (1) | Name and telephone number of person to contact in regard to this notification |
| Mark V. Noffke | 650 | 380-8280 | |
| (Name) | (Area Code) | (Telephone Number) |
| (2) | Have all other periodic reports required under Section 13 or 15(d) of the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940 during the preceding 12 months or for such shorter period that the registrant was required to file such report(s) been filed ? If answer is no, identify report(s). ☒ Yes ☐ No |
| (3) | Is it anticipated that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earnings statements to be included in the subject report or portion thereof? ☒ Yes ☐No |
The table below summarizes the estimated results of operations for the three and nine months ended September 30, 2015 and 2014:
| Three Months Ended | Nine Months Ended | |||||||
| September 30, | September 30, | |||||||
| 2015 | 2014 | 2015 | 2014 | |||||
| Revenue | $ 1,389,075 | $ 353,903 | $ 3,458,473 | $ 619,034 | ||||
| Operating expenses | 3,655,293 | 3,786,762 | 9,516,805 | 7,301,088 | ||||
| Loss from operations | (2,266,218) | (3,432,859) | (6,058,332) | (6,682,054) | ||||
| Other income (expense) | (564,375) | (289,134) | (4,603,287) | (2,378,352) | ||||
| Net loss | $ (2,830,593) | $ (3,721,993) | $ (10,661,619) | $ (9,060,406) | ||||
Revenue
Our revenue for the nine months ended September 30, 2015 was $3,458,473 compared to $619,034 for the nine months ended September 30, 2014. The revenue for the nine months ended September 30, 2015 consisted of $1,756,011 from our social networks division, $1,583,946 from our business services division, and $118,516 from our funding division. All of our revenue was derived from member payments, event fees, annual event packages, mentoring fees, public relations revenue along with advisory fees, sponsorships and revenue shares with strategic partners. The increase in revenue was primarily due to having a full year of revenue from MCC and the acquisitions of HT Skills, Member Digital, GroupCard, ELEQT and Robson Dowry.
Operating Expenses
Our operating expenses increased by $2,215,717 to $9,516,805 for the nine month period ended September 30, 2015, from $7,301,088 for the nine month period ended September 30, 2014. This increase was primarily due to the increase in the cost of revenue of $314,159, an increase in sales and marketing of $608,163, an increase in general and administrative costs of $781,038, an increase in depreciation and amortization of $122,766, and an increase in impairment of goodwill of $422,369. These increases were partially offset by a decrease in loss on forgiveness of liabilities of $32,778.
Net Loss
Our net loss increased by $1,601,213 to $10,661,619 for the nine month period ended September 30, 2015 from $9,060,406 for the nine months ended September 30, 2014. The increase in net loss compared to the prior year period is primarily a result of an increase in revenue of $2,839,439 offset by the increase in operating expenses of $2,215,717, an increase in the loss on change in fair value of derivative liability of $1,488,531, and an increase in amortization of warrants of $1,062,107. These increases are partially offset by a decrease in interest expense of $122,922, in loss on conversion of debt of $49,926, a decrease in derivative loss of $130,328, and an increase in other income of $22,527
The financial results presented above for the quarter ended September 30, 2015 reflect preliminary estimates of the Company’s results of operations and anticipated changes for the corresponding prior period as of the date of the filing of the Form 12b-25. These estimates are subject to change upon the completion of the reporting process and review of the Company’s financial statements, and actual results may vary significantly from these estimates.
Cautionary Note on Forward-Looking Statements
This notification contains or may contain, among other things, certain forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve significant risks and uncertainties. Such statements may include, without limitation, statements with respect to the Company’s plans, objectives, projections, expectations and intentions and other statements identified by words such as “projects”, “may”, “could”, “would”, “should”, “believes”, “expects”, “anticipates”, “estimates”, “intends”, “plans” or similar expressions. These statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties, including those detailed in the Company’s filings with the Securities and Exchange Commission. Actual results may differ significantly from those set forth in the forward-looking statements. These forward-looking statements involve certain risks and uncertainties that are subject to change based on various factors (many of which are beyond the Company’s control). The Company does not intend to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.
EFACTOR GROUP CORP.
(Name of Registrant as Specified in Charter)
has caused this notification to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: November 17, 2015 | By: | /s/ Mark V. Noffke |
| Name: | Mark V. Noffke | |
| Title: | Chief Financial Officer |
| ATTENTION |
| Intentional misstatements or omissions of fact constitute Federal Criminal Violations (See 18 U.S.C. 1001). |