Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Apr. 13, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Excel Corp | |
Entity Central Index Key | 1,512,890 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-K | |
Document Period End Date | Dec. 31, 2016 | |
Document Fiscal Period Focus | FY | |
Document Fiscal Year Focus | 2,016 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | Yes | |
Entity Current Reporting Status | No | |
Entity Public Float | $ 10,047,198 | |
Entity Common Stock, Shares Outstanding | 97,860,366 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets | ||
Cash and cash equivalents | $ 1,586,207 | $ 362,130 |
Accounts receivable | 1,220,759 | 1,016,141 |
Note receivable | 675,000 | |
Prepaid expenses | 105,995 | 43,074 |
Other current assets | 89,050 | 83,545 |
Current assets held for sale | 167,406 | |
Total current assets | 3,677,011 | 1,672,296 |
Other Assets | ||
Fixed assets, net of depreciation | 170,442 | 184,960 |
Goodwill | 7,914,269 | 7,914,269 |
Note Receivable | 675,000 | |
Equity investment | 171,469 | 164,790 |
Residual portfolios | 2,147,488 | 2,505,164 |
Other long term assets | 631,271 | 593,893 |
Other assets held for sale | 302,898 | |
Total other assets | 11,034,939 | 12,340,974 |
Total assets | 14,711,950 | 14,013,270 |
Current Liabilities | ||
Accounts payable | 577,220 | 1,374,878 |
Accrued compensation | 1,054,532 | 1,508,531 |
Other accrued liabilities | 551,447 | 839,308 |
Notes payable - current portion | 12,809,252 | 8,984,544 |
Accrued costs of disposal of discontinued operations | 50,000 | |
Total current liabilities | 15,042,451 | 12,707,261 |
Long-term liabilities | ||
Notes payable - long term portion | 226,733 | |
Other long term liabilities | 41,705 | 41,692 |
Total long-term liabilities | 41,705 | 268,425 |
Commitments and contingencies | ||
STOCKHOLDERS' EQUITY (DEFICIT) | ||
Preferred stock, value | ||
Common stock, $.0001 par value, 200,000,000 shares authorized 97,759,070 and 98,259,070 shares issued and outstanding as of December 31, 2016 and December 31, 2015, respectively. | 9,776 | 9,826 |
Additional paid-in capital | 4,814,348 | 4,428,391 |
Accumulated deficit | (5,196,790) | (3,400,633) |
Total stockholders' equity (deficit) | (372,206) | 1,037,584 |
Total Liabilities and Stockholders' Equity (Deficit) | 14,711,950 | 14,013,270 |
Series A preferred stock | ||
STOCKHOLDERS' EQUITY (DEFICIT) | ||
Preferred stock, value | ||
Series B preferred stock | ||
STOCKHOLDERS' EQUITY (DEFICIT) | ||
Preferred stock, value | $ 460 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 97,759,070 | 98,259,070 |
Common stock, shares outstanding | 97,759,070 | 98,259,070 |
Series A preferred stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 0 | 2 |
Preferred stock, shares outstanding | 0 | 2 |
Series B preferred stock | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares issued | 4,600,000 | 0 |
Preferred stock, shares outstanding | 4,600,000 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues | ||
Transaction and processing fees | $ 16,809,208 | $ 5,549,482 |
Merchant cash advance revenue and other | 306,002 | 79,758 |
Total revenues | 17,115,210 | 5,629,240 |
Costs and expenses | ||
Processing and servicing costs | 7,045,624 | 546,803 |
Salaries and wages | 3,644,365 | 2,187,630 |
Outside commissions | 2,417,523 | 669,940 |
Other selling general and administrative expenses | 1,184,936 | 221,437 |
Total costs and expenses | 14,292,448 | 3,625,810 |
Income from operations | 2,822,762 | 2,003,430 |
Interest expense, net | 1,556,105 | 371,596 |
Other income (expense) | (33,602) | 445,742 |
Net income from continuing operations before income taxes | 1,233,055 | 2,077,576 |
Income tax expense (benefit) | ||
Current | 456,230 | 768,703 |
Deferred | (456,230) | (768,703) |
Income tax expense | ||
Net income from continuing operations | 1,233,055 | 2,077,576 |
Loss from discontinued operations, net of tax | (2,188,571) | (3,700,070) |
Loss on disposal of operations | (840,641) | |
Net loss | $ (1,796,157) | $ (1,622,494) |
Basic earnings per share | ||
Income from continuing operations | $ 0.013 | $ 0.021 |
Loss from discontinued operations, net of tax | (0.031) | (0.038) |
Net loss | (0.018) | (0.017) |
Diluted earnings per share | ||
Income from continuing operations | 0.012 | 0.021 |
Loss from discontinued operations, net of tax | (0.030) | (0.038) |
Net loss | $ (0.018) | $ (0.017) |
Weighted Average Shares Outstanding | ||
Basic | 97,215,234 | 98,261,810 |
Diluted | 100,811,296 | 98,261,810 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) | Total | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Series A preferred stock | Series B preferred stock |
Balances at Dec. 31, 2014 | $ 9,726 | $ 4,232,342 | $ (1,778,139) | ||||
Balances (in shares) at Dec. 31, 2014 | 97,259,070 | 2 | |||||
Stock Compensation Expense | $ 200 | 285,949 | |||||
Stock Compensation Expense, Shares | 2,000,000 | ||||||
Return of Common Stock | $ (100) | (89,900) | |||||
Return of Common Stock, Shares | (1,000,000) | ||||||
Net loss | $ (1,622,494) | (1,622,494) | |||||
Balances at Dec. 31, 2015 | 1,037,584 | $ 9,826 | 4,428,391 | (3,400,633) | |||
Balances (in shares) at Dec. 31, 2015 | 98,259,070 | 2 | |||||
Issuance of preferred stock at .05 per share | 229,540 | $ 460 | |||||
Issuance of preferred stock at .05 per share, Shares | 4,600,000 | ||||||
Stock Compensation Expense | $ 100 | 156,417 | |||||
Stock Compensation Expense, Shares | 1,000,000 | ||||||
Return of Common Stock | $ (150) | ||||||
Return of Common Stock, Shares | (1,500,000) | ||||||
Net loss | (1,796,157) | (1,796,157) | |||||
Balances at Dec. 31, 2016 | $ (372,206) | $ 9,776 | $ 4,814,348 | $ (5,196,790) | $ 460 | ||
Balances (in shares) at Dec. 31, 2016 | 97,759,070 | 2 | 4,600,000 |
Consolidated Statements of Sto6
Consolidated Statements of Stockholders' Equity (Deficit) (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Preferred stock at .05 per share | ||
Shares issued, price per share | $ 0.05 | |
Common Stock at .09 per share | ||
Shares issued, price per share | $ 0.09 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Operating activities: | ||
Net loss | $ (1,796,157) | $ (1,622,494) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 485,784 | 143,428 |
Loss on early extinguishment of debt | (33,602) | |
Paid in kind interest | 112,734 | |
Stock based compensation | 156,367 | 286,149 |
Income in investment accounted for under the equity method | (6,679) | |
Loss on disposal of operations | 840,641 | |
Decrease (increase) | ||
Accounts receivable | (54,618) | (328,837) |
Prepaid expenses | (62,921) | 1,011 |
Other current assets | (5,505) | 83,513 |
Inventory | (143) | |
Other long term assets | (3,776) | (13,039) |
Increase (decrease) | ||
Accounts payable | (797,658) | 542,898 |
Accrued compensation | (453,999) | 905,848 |
Other accrued liabilities | (287,861) | 269,789 |
Other long-term liabilities | 13 | 11,944 |
Net cash provided by (used in) operating activities | (1,907,237) | 280,067 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (36,663) | (170,935) |
Payments from disposal of operations | (500,000) | |
Acquisition of eVance assets | 257,886 | |
Net cash provided by (used in) investing activities | (536,663) | 86,951 |
Cash flows from financing activities: | ||
Issuance of notes | 12,649,254 | 600,000 |
Issuance of preferred stock | 230,000 | |
Note and debt payments | (9,211,277) | (931,676) |
Net cash provided by (used in) financing activities | 3,667,977 | (331,676) |
Net increase in cash | 1,224,077 | 35,342 |
Cash - Beginning | 362,130 | 326,788 |
Cash - Ending | 1,586,207 | 362,130 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | 1,500,160 | 371,596 |
State Income Taxes | $ 11,545 | $ 5,126 |
Organization and Operations
Organization and Operations | 12 Months Ended |
Dec. 31, 2016 | |
Organization and Operations [Abstract] | |
ORGANIZATION AND OPERATIONS | 1. ORGANIZATION AND OPERATIONS Excel Corporation (the “Company”) was organized on November 13, 2010 as a Delaware corporation. The Company has three wholly owned subsidiaries, Excel Business Solutions, Inc. (d/b/a eVance Capital), Payprotec Oregon, LLC (d/b/a Securus Payments), (“Securus”), and eVance Processing Inc. (“eVance”). We sell integrated financial and transaction processing services to businesses throughout the United States. We provide these services through our wholly-owned subsidiaries, eVance and Securus. Through our eVance subsidiary, we provide an integrated suite of third-party merchant payment processing services and related proprietary software enabling products that deliver credit and debit card-based internet payments processing solutions primarily to small and mid-sized merchants operating in physical “brick and mortar” business environments, on the internet and in retail settings requiring both wired and wireless mobile payment solutions. We operate as an independent sales organization (“ISO”) generating individual merchant processing contracts in exchange for future residual payments. As a wholesale ISO, eVance has a direct contractual relationship with the merchants and takes greater responsibility in the approval and monitoring of merchants than do retail ISOs and we receive additional consideration for this service and risk. Securus operates as a retail ISO and receives residual income as commission for merchants it places with third party processors. On November 30, 2015, eVance entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Calpian, Inc. (“Calpian”), Calpian Residual Acquisition, LLC (“CRA”) and Calpian Commerce, Inc., a wholly owned subsidiary of Calpian (“CCI,” and collectively with Calpian and CRA, the “Sellers”). Pursuant to the Purchase Agreement, eVance acquired substantially all of the U.S. assets and operations of the Sellers. In consideration for the acquired assets, eVance assumed certain of the Sellers’ liabilities, including an aggregate of $9,000,000 of notes payable and certain of the Sellers’ outstanding contractual obligations. On April 12, 2016, eVance entered into an agreement with the Sellers and a cancellation of securities acknowledgement with one of eVance’s note-holders whereby the noteholder cancelled its note in the amount of $720,084 and Calpian issued eVance a note in the amount of $675,000 in exchange for eVance and the Sellers mutually waiving any claims either party has or could have under the Purchase Agreement against the other. The $675,000 note bears simple interest of 12% per annum payable monthly and matures on November 30, 2017. As part of the Purchase Agreement, eVance acquired several residual portfolios including the supporting contracts (residual purchase agreements). eVance, as successor under one of these residual purchase agreements, has sued a third party for breach of contract on the residual purchase agreement between the third party and Seller and claimed damages in excess of $1,500,000. eVance has agreed to apply any recovery from such litigation (less costs) against the principal balance of the $675,000 note up to a maximum of $675,000. The Company reflected the reduction in the assumed debt by $720,084 as a reduction in goodwill and a reduction in the debt assumed. In addition, the noteholder returned a warrant to purchase 360,042 shares of the Company’s common stock. As a result of this agreement, the $9,000,000 of notes payable was reduced to $8,279,916. On April 30, 2016, Securus entered into a Purchase and Sale Agreement (the “2016 Purchase Agreement”) with Chyp LLC (“Chyp”). In connection with the 2016 Purchase Agreement, Chyp executed a three-year preferred marketing agreement with eVance. Chyp acquired substantially all of the operations of Securus including its sales and marketing operations located in Portland, Oregon and West Palm Beach, Florida. Securus retained the approximately 5,000 merchants and related merchant processing residual portfolios. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Summary of Significant Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Company’s financial statements are prepared on the accrual method of accounting. The consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for annual financial reporting. Principles of Consolidation The consolidated financial statements include the accounts of Excel Corporation and subsidiaries in which the Company has a controlling financial interest. All intercompany transactions and account balances between Excel Corporation and its subsidiaries have been eliminated in consolidation. Transactions with its consolidated subsidiaries are generally settled in cash. Investments in unconsolidated affiliated entities are accounted for under the equity method and are included in “Equity investment” in the accompanying consolidated balance sheets. Business Combinations Acquisitions are accounted for using the acquisition method of accounting. The purchase price of an acquisition is allocated to the assets acquired and liabilities assumed using the estimated fair values at the acquisition date. Transaction costs are expensed as incurred. Goodwill Goodwill represents the excess of acquisition cost over the fair value of net tangible and intangible assets acquired in connection with an acquisition. Goodwill is assessed for impairment annually or more frequently if circumstances indicate impairment may have occurred. Revenue Recognition The Company receives a percentage of recurring monthly transaction related fees comprised of credit and debit card fees charged to merchants, net of association fees, otherwise known as Interchange, as well as certain service charges and convenience fees, for payment processing services, including authorization, capture, clearing, settlement and information reporting of electronic transactions. Fees are calculated on either a percentage of the dollar volume of the transaction or a fixed fee or a hybrid of the two and are recognized at the time of the transaction. In the case of “wholesale” residual revenue in which the Company has a direct contractual relationship with the merchant, bears risk of chargebacks and performs underwriting on the merchants, the Company records the full discount charged to the merchant as revenue and the related interchange and other processing fees as expenses. In cases of residual revenue where the Company is not responsible for merchant underwriting and has no chargeback liability and has no or limited contractual relationship with the merchant, the Company records the amount it receives from the processor net of interchange and other processing fees as revenue. The Company acts as an ISO offering alternative financing and working capital solutions (merchant cash advances) to small and medium sized businesses using a variety of third party funding sources. As an ISO, we earn commissions from capital funders by placing their financial products with our merchant customers. This portion of our business does not yet represent a significant portion of our revenues, costs or assets. Cash and Cash Equivalents The Company considers all cash accounts, which are not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less as cash and cash equivalents. The carrying amount of financial instruments included in cash and cash equivalents approximates fair value because of the short maturities for the instruments held. Income Taxes Income taxes are provided for the tax effects of the transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to tax net operating loss carryforwards. The deferred tax assets and liabilities represent the future tax return consequences of these differences, which will either be taxable or deductible when assets and liabilities are recovered or settled, as well as operating loss carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established against deferred tax assets when in the judgment of management, it is more likely than not that such deferred tax assets will not become available. Because the judgment about the level of future taxable income is dependent to a great extent on matters that may, at least in part, be beyond the Company’s control, it is at least reasonably possible that management’s judgment about the need for a valuation allowance for deferred taxes could change in the near term. Reclassification Certain prior period amounts have been reclassified to conform to the current year’s presentation. Accounts Receivable Accounts receivable represent contractual residual payments due from the Company's processing partners. These residual payments are determined based on transaction fees and revenues from the credit and debit card processing activity of merchants for which the Company’s processing partners pay the Company. Based on collection experience and periodic reviews of outstanding receivables, management considers all accounts receivable to be fully collectible and accordingly, no allowance for doubtful accounts is required. Property and Equipment Property and equipment is stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment is calculated using the straight-line method over the estimated useful lives of the assets, which range from five to ten years. Leasehold improvements are amortized over the lesser of the expected term of the lease or the estimated useful life of the asset. Expenditures for repairs and maintenance are expensed as incurred. Residual Portfolios Residual portfolios are valued at fair value on the date of acquisition and are amortized over their estimated useful lives (7 years). Equity Investments Equity investments are valued at fair value on the date of acquisition using the equity method of accounting and adjusted in subsequent periods for the Company’s share of the investment’s earnings and distributions. Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the evaluation of deferred tax assets, purchase accounting, allowances, and equity investments. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Measurements [Abstract] | |
FAIR VALUE MEASUREMENTS | 3. FAIR VALUE MEASUREMENTS Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC Topic No. 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels, as described below: Level 1: Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable, either directly or indirectly. Level 2 inputs include quoted prices for similar assets, quoted prices in markets that are not considered to be active, and observable inputs other than quoted prices such as interest rates. Level 3: Level 3 inputs are unobservable inputs. The following required disclosure of the estimated fair value of financial instruments has been determined by the Company using available market information and appropriate valuation methodologies. However, considerable judgment is required to interpret market data to develop the estimates of fair value. Accordingly, the use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. The methods and assumptions used to estimate the fair values of each class of financial instruments are as follows: Cash and Cash Equivalents, Accounts Receivable, Other Current Assets, Accounts Payable, Accrued Compensation and Other Accrued Liabilities. The items are generally short-term in nature, and accordingly, the carrying amounts reported on the consolidated balance sheets are reasonable approximations of their fair values. Note Receivable, Other Long Term Assets, Notes Payable, and Other Long Term Liabilities. The carrying amounts approximate the fair value as the notes bear interest rates that are consistent with current market rates. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2016 | |
Recent Accounting Pronouncements [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | 4. RECENT ACCOUNTING PRONOUNCEMENTS In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers Topic 606 (“ASU 2014-09”) which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. Revenue recorded under ASU 2014-09 will depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance is effective for the Company’s fiscal year beginning January 1, 2018 and early adoption is not permitted. The Company is currently evaluating the potential effect of this standard on its consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes In February 2016, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) (“ASU 2016-02”), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract. The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. ASU 2016-02 supersedes the previous leases standard, Leases (Topic 840). The standard is effective on January 1, 2019, with early adoption permitted. The Company is currently evaluating the potential effect of this standard on its consolidated financial statements. On August 26, 2016, the FASB issued ASU 2016-15, “ Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments (Topic 230) ● Debt prepayment or debt extinguishment costs. ● Settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing. ● Contingent consideration payments made after a business combination. ● Proceeds from the settlement of insurance claims. ● Proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies. ● Distributions received from equity method investees. ● Beneficial interests in securitization transactions. ● Separately identifiable cash flows and application of the predominance principle. The guidance in the ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the potential effect of this standard on its consolidated financial statements. Accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Dec. 31, 2016 | |
Discontinued Operations [Abstract] | |
DISCONTINUED OPERATIONS | 5. DISCONTINUED OPERATIONS On April 30, 2016, Securus entered into the 2016 Purchase Agreement with Chyp. In connection with the 2016 Purchase Agreement, Chyp executed a three-year preferred marketing agreement with eVance. Pursuant to the 2016 Purchase Agreement, Chyp acquired substantially all of the operations of Securus including its sales and marketing operations located in Portland, Oregon and West Palm Beach, Florida. Securus retained its approximately 5,000 merchants and related merchant processing residual portfolio. Securus also retained substantially all of its liabilities, including but not limited to, its note payable with Blue Acre Ventures (BAV), trade payables as well as liabilities to merchants. Pursuant to the 2016 Purchase Agreement, Securus provided financial assistance to Chyp in the form of a forgivable loan to support the transition of Securus’ operations to Chyp. Securus advanced Chyp $500,000 during 2016 and has one remaining payment of $50,000 to be paid in 2017 for a total of $550,000. Accordingly, Chyp executed a $550,000 promissory note (the “Chyp Note”) in favor of Securus. The Chyp Note bears an interest rate of 12% per annum with both the principal and interest due on May 1, 2017. If Chyp is in material compliance with the 2016 Purchase Agreement and related agreements through May 1, 2017, Securus will forgive the Chyp Note. Securus will also reimburse Chyp for commissions payable to Chyp employees and agents on Securus’ residual portfolio as if those agents and employees were still employed by Securus. Chyp is owned by Steven Lemma and Mychol Robirds, who are former executives of Securus. We accounted for the sale of the Securus operations to Chyp in accordance with ASC 205-20-45-1 and have classified the assets and operations sold to Chyp as discontinued operations. The Company recorded a loss on disposal of $840,641 related to the transaction. The charge includes a $290,641 write-off of the net assets acquired by Chyp and $550,000 for the financial assistance to be provided to Chyp. A summary of results of discontinued operations is as follows: For the Years ended 2016 2015 Revenues $ 2,027,684 $ 11,970,092 Operating expenses (4,216,255 ) (15,670,162 ) Pre-tax loss from discontinued operations (2,188,571 ) (3,700,070 ) Loss from discontinued operations, net of tax $ (2,188,571 ) $ (3,700,070 ) |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Taxes [Abstract] | |
INCOME TAXES | 6. INCOME TAXES The Company accounts for income taxes in accordance with FASB Accounting Standards Codification Topic 740-10 which requires the Company to provide a net deferred tax asset/liability equal to the expected future tax benefit/expense of temporary reporting differences between book and tax accounting methods and any available net operating loss or tax credit carryforwards. At December 31, 2016 and December 31, 2015, the Company had available unused net operating loss carryforwards of $4,194,335 and $2,241,453, respectively, which generated a deferred tax benefits of $1,551,904 and $829,338, respectively. The Company had a 100% valuation allowance on the deferred tax assets at December 31, 2016 and December 31, 2015, respectively. The net operating loss carryforwards will begin to expire in 2035. After analyzing our forecasted tax position at December 31, 2016 we currently expect to utilize all of our net operating loss carryforwards prior to their expiration dates. The reconciliation of the statutory rate to the Company’s effective income tax rate are as follows: For the Year Ended December 31, 2016 For the Year Ended December 31, 2015 Statutory Rate (34 )% (34 )% State income tax, net of federal income tax benefit (3 )% (3 )% Valuation Allowance 37 % 37 % Effective Rate 0 % 0 % The Company’s provision for income taxes for the year ended December 31, 2016 and 2015 consists of the following: For the Year Ended December 31, 2016 For the Year Ended December 31, 2015 Income Tax Expense Continuing Operations Discontinued Operations Total Continuing Operations Discontinued Operations Total Current $ 456,230 $ (1,120,808 ) $ (664,578 ) $ 768,703 $ (1,369,026 ) $ (600,323 ) Deferred (456,230 ) 1,120,808 664,578 (768,703 ) 1,369,026 600,323 Total $ - $ - $ - $ - $ - $ - Significant components of the Company’s deferred income taxes are as follows: For the Years Ended December 31, 2016 2015 Deferred Tax Assets Net operating loss carryforwards $ 1,493,916 $ 452,452 Accrued compensation 128,253 289,523 Other accrued liabilities (74,125 ) 52,503 Depreciation and amortization 3,860 34,860 Total deferred tax assets 1,551,904 829,338 Valuation allowance (1,551,904 ) (829,338 ) Net deferred tax asset - - Deferred tax liabilities - - The Company accounts for uncertainties in income taxes in accordance with FASB ASC Topic 740 “Accounting for Uncertainty in Income Taxes”. The Company has determined that there are no significant uncertain tax positions requiring recognition in its financial statements. In the event the Company is assessed for interest and/or penalties by taxing authorities, such assessed amounts will be classified in the financial statements as income tax expense. Tax years 2013 through 2015 remain subject to examination by Federal and state taxing authorities. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity [Abstract] | |
STOCKHOLDERS' EQUITY | 7. STOCKHOLDERS’ EQUITY On March 18, 2016, the Company issued 2,300,000 Shares of Series B Convertible Preferred Stock (“Series B Shares”) to each of Thomas A. Hyde Jr. and Robert L. Winspear (each a “Holder” and collectively the “Holders”) at a price of $0.05 per share pursuant to subscription agreements between the Company and the Holders. Mr. Hyde is the President, Chief Executive Officer and a Director of the Company. Mr. Winspear is the Chief Financial Officer of the Company. The Series B Shares are convertible into shares of the Company’s common stock par value $0.0001 (“Common Stock”) on a ratio of 1-to-1, subject to adjustment for stock splits and stock dividends. The Series B Shares rank senior to the Common Stock and other preferred shares and carry a liquidation preference of $.05 per share. Holders of the Series B Shares are entitled to receive dividends declared on the Company’s Common Stock on an as converted basis. Each Series B Share entitles the Holder thereof to 20 votes per share on all matters subject to voting by holders of the Company’s Common Stock. The issuance of a total of 4,600,000 shares of Series B Shares, entitles the Holders thereof to a combined 92,000,000 votes. Under the terms of the Series B Shares, the Company has the right to require a Holder to convert the Series B Shares into Common Stock at any time after the Holder resigns, is terminated or otherwise ceases to be an officer of the Company. In addition, the Company has the right at any time after July 18, 2016 to repurchase and retire all but not less than all of the Series B Preferred Stock for $0.05 per share provided that it gives notice to the Holder of the Company’s intent to redeem the shares and the Holder does not elect to convert the Series B Shares into Common Stock in lieu of the redemption. In connection with the issuance of the Series B Shares, the Company and the Holders executed a Stockholders Agreement (the “Agreement”) whereby the Holders agreed not to initiate directly or indirectly any stockholder vote or action, by written consent or otherwise, to increase the size or structure of the Company’s board of directors or remove any existing director, nor initiate directly or indirectly any stockholder vote or action by written consent or otherwise, to affect Holders’ executive compensation, bonus criteria and amounts, or other similar action. The Holders also agreed to convert the Series B Shares immediately upon termination, whether voluntary or involuntary, or upon their resignation for any reason. On November 30, 2015, in connection with its acquisition of the U.S. assets and operations of Calpian Inc., the Company issued warrants to purchase an aggregate of 5,452,458 shares of the Company’s common stock at an exercise price of $0.05 per share, subject to adjustments. The warrants expire on November 30, 2025. We estimate the fair value of warrants and stock options when issued or vested using the Black-Scholes options pricing model and subsequent changes in fair value are not recognized. Option pricing models require the input of highly subjective assumptions. We determined, using the Black-Scholes options pricing model, that these warrants have no current value, based on a maturity date of five years, a risk-free interest rate of 2.230%, and a calculated volatility rate of 8.530%, using historical stock prices of the Company at the time of issuance. |
Stock Option and Compensation
Stock Option and Compensation | 12 Months Ended |
Dec. 31, 2016 | |
Stock Options and Compensation [Abstract] | |
STOCK OPTIONS AND COMPENSATION | 8. STOCK OPTIONS AND COMPENSATION On November 13, 2010 the Company’s Board of Directors (the “Board”) approved a stock plan pursuant to which the Company may grant incentive and non-statutory options to employees, non-employee members of the Board and consultants and other independent advisors who provide services to the Corporation. The maximum shares of common stock which may be issued over the term of the plan cannot exceed 4,000,000 shares. Awards under this plan are made by the Board or a committee of the Board. Options under the plan are to be issued at the market price of the stock on the day of the grant except to those issued to holders of 10% or more of the Company’s Common Stock which is required to be issued at a price not less than 110% of the fair market value on the day of the grant. Each option is exercisable at such time or times, during such period and for such numbers of shares shall be determined by the Plan Administrator. However, no option shall have a term in excess of 10 years from the date of the grant. On June 1, 2015, the Company issued 2,000,000 shares of its Common Stock to an executive in connection with the executive’s employment and the use of certain trade names and brands owned by the executive. 500,000 shares vested upon grant and an additional 500,000 shares were scheduled to vest on June 1, 2016, June 1, 2017, and June 1, 2018. The Company terminated the executive’s employment in January 2016, and the shares subject to vesting were forfeited. On August 12, 2016, the Company granted 1,000,000 shares of its common stock to an employee. 333,333 of these shares vested upon grant, 333,333 vested on December 1, 2016 and 333,334 vest on December 1, 2017. On August 12, 2016, the Company also issued a warrant to purchase 500,000 of its common stock to a consultant. The warrant has an exercise price of $0.06 per share and a term of 18 months. For the Years Ended December 31, Restricted Stock Grants 2016 2015 Shares outstanding on January 1 7,465,608 5,465,608 Granted 1,000,000 2,000,000 Forfeited (1,500,000 ) — Shares outstanding on December 31 6,965,608 7,465,608 Shares vested at December 31 6,632,274 4,143,739 For the Years Ended December 31, Stock Options 2016 2015 Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Options outstanding at January 1 1,000,000 $ .09 1,000,000 $ 0.09 Granted — — — — Exercised — — — — Forfeited 1,000,000 $ .09 — — Options outstanding December 31 — — 1,000,000 $ 0.09 Shares exercisable at December 31 — — 444,448 $ 0.09 |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2016 | |
Acquisitions [Abstract] | |
ACQUISITIONS | 9. ACQUISITIONS On November 30, 2015, eVance Processing Inc. (“eVance”), a wholly owned subsidiary of the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Calpian, Inc. (“Calpian”), Calpian Residual Acquisition, LLC (“CRA”) and Calpian Commerce, Inc., a wholly owned subsidiary of Calpian (“CCI,” and collectively with Calpian and CRA, the “Sellers”). Pursuant to the Purchase Agreement, eVance acquired substantially all of the U.S. assets and operations of the Sellers. In consideration for the acquired assets, eVance assumed certain of the Sellers’ liabilities, including an aggregate of $9,000,000 of notes payable and certain of the Sellers’ outstanding contractual obligations. On April 12, 2016, eVance entered into an agreement with the Sellers and a cancellation of securities acknowledgement with one of eVance’s note holders whereby the noteholder cancelled their note in the amount of $720,084 and Calpian issued eVance a note in the amount of $675,000 in exchange for eVance waiving any claims for breach of the Purchase Agreement between eVance and Sellers. The $675,000 note bears simple interest of 12% per annum payable monthly, matures on November 30, 2017 and is secured by 2,000,000 shares of Calpian common stock. As part of the Purchase Agreement, eVance acquired several residual portfolios including the supporting contracts (residual purchase agreements). eVance, as successor under one of these residual purchase agreements, has sued a third party for breach of contract on the residual purchase agreement between the third party and Seller and has claimed damages in excess of $1,500,000. eVance has agreed to apply any recovery from such litigation (less costs) against the principle balance of the $675,000 note up to a maximum of $675,000. The Company reflected the cancellation of the $720,084 note and the receipt of the $675,000 Calpian note as a $1,395,084 reduction in goodwill. In addition, the noteholder cancelled and returned a warrant to purchase 360,042 shares of the Company’s common stock. The following is a summary of the estimated fair values of the assets acquired and liabilities assumed on November 30, 2015: Cash and cash equivalents $ 257,886 Accounts receivable 461,647 Other current assets 167,058 Property and equipment, net 174,403 Residual portfolios 2,540,690 Equity investments 164,790 Deposits 532,617 Total assets 4,299,091 Accounts payable 25,000 Accrued liabilities 143,089 Total liabilities 168,089 Fair value of net assets acquired $ 4,131,002 Calpian note received $ 675,000 Fair value of debt assumed $ 8,279,916 Goodwill recognized on acquisition $ 3,473,914 The fair value of the net assets acquired less the fair value of debt assumed resulted in a difference of $3,473,914, which has been recorded as goodwill in the Company’s consolidated balance sheets. All of the recorded goodwill is tax-deductible. The consolidated statements of operations for the fiscal year ended December 31, 2015 includes the financial results of eVance since the date of acquisition, November 30, 2015, through December 31, 2015. During this period, eVance’s revenues were $1,022,073 and its net income was $64,965. Pro Forma Financial Information (Unaudited) The information that follows provides supplemental information about pro forma revenues and net income (loss) attributable to the Company as if the acquisition of Calpian’s US assets by eVance been consummated as of January 1, 2015. Such information is unaudited and is based on estimates and assumptions which the Company believes are reasonable. These results are not necessarily indicative of the consolidated statements of operations in future periods or the results that would have actually been realized had the Company and eVance been a combined entity during 2014 and 2015. Selected Pro Forma Financial Information Years Ended December 31, 2015 Excel Calpian U.S. Assets Total Revenues $ 5,628,540 $ 14,621,149 $ 20,249,689 Net income (loss) attributable to the Company $ (1,622,494 ) $ 72,942 $ (1,549,552 ) Net income (loss) attributable to the Company per common share - basic and diluted $ (0.02 ) $ 0.001 $ (0.02 ) |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | 10. PROPERTY AND EQUIPMENT Property and equipment consists of the following for the years ending: December 31, December 31, Computer software $ 38,607 35,595 Equipment 163,394 123,074 Furniture & fixtures 38,882 33,336 Leasehold improvements 16,538 3,471 Total cost 257,421 195,476 Less accumulated depreciation and amortization (86,979 ) (10,516 ) Property and equipment – net $ 170,442 184,960 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
LEASES | 11. LEASES The Company executed a lease for its corporate offices in Irving Texas. The lease began on November 1, 2014 and has a term of 63 months with monthly payments ranging from $0 to $6,428. eVance leases its Georgia office facilities under an operating lease expiring in November 2019. Monthly lease payments range from $8,278 to $9,046 throughout the term of the lease. Total rent expense for the year ended December 31, 2016 was $298,816, compared to $438,109 for the year ended December 31, 2015. The future minimum lease payments required under long-term operating leases as of December 31, 2016 are as follows: 2017 $ 175,091 2018 179,489 2019 174,946 2020 6,430 2021 and after - Total $ 535,956 |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2016 | |
Notes Payable [Abstract] | |
NOTES PAYABLE | 12. NOTES PAYABLE The following summarizes the Company’s outstanding notes payable for the years ending: December 31, 2016 December 31, 2015 Note payable to BAV, due in monthly installments of $48,333 through May 2017, including simple interest at 15%, secured by the Company’s residual portfolio $ - $ 681,361 Note payable to SME Funding LLC, due December 1,2016, bearing simple interest at 12%, secured by the Company’s residual portfolio - 500,000 Notes payable due December 1, 2016, bearing interest at 12%, secured by the assets of eVance - 8,029,916 Term Loan due November 2019, bearing interest at 18%, secured by substantially all of the assets of the Company 12,809,252 - Total 12,809,252 9,211,277 Less current portion 12,809,252 (8,984,544 ) Long-term portion of notes payable $ - $ 226,733 On November 30, 2015, in connection with the purchase of the U.S. assets and operations of Calpian, eVance assumed an aggregate of $9,000,000 of notes payable, including $6.0 million of debt issued pursuant to a note offering conducted by Calpian and in which the Company invested $250,000. Concurrently, eVance issued amended promissory notes (the “eVance Notes”) in favor of each lender (collectively, the “eVance Lenders”) evidencing eVance’s assumption of $9,000,000 of indebtedness. Pursuant to a purchase price adjustment agreement dated April 12, 2016, the principal value of the eVance Notes was reduced to $8,279,916 (see Note 13). The $250,000 of eVance Notes purchased by the Company have been eliminated in consolidation to reflect a net balance of $8,029,916 as of December 31, 2015. The eVance Notes were repaid in full in connection with the completion of the credit facility discussed below. On October 23, 2015, SME Funding LLC advanced the Company $500,000 to help finance the acquisition of the US assets of Calpian Inc by eVance. This advance was converted into a note maturing December 1, 2016 with interest only payable monthly at an annual rate of 12%. This note was repaid in full in connection with the completion of the credit facility discussed below. On November 2, 2016, the Company and certain of the Company’s subsidiaries entered into a Loan and Security Agreement (the “Loan Agreement”) with GACP Finance Co. LLC as administrative agent (“Agent”) and the other lenders as from time to time party thereto. The Loan Agreement has a three-year term and provides for term loan commitments of up to $25,000,000 consisting of an Initial Term Loan in the amount of $13,500,000 and a Delayed Draw Term Loan in the amount of $11,500,000 (each a “Loan” or together “Loans”). The Company used the proceeds from the Initial Term Loan to repay all of its existing secured debt. The Company expects to use the Delayed Draw Term Loan to fund acquisitions of portfolios of recurring residual revenues from credit and debit card transactions or companies that own these portfolios. Funding of Delayed Draw Term Loan is subject to certain conditions including but not limited to borrowing base limitations and further lender due diligence. The Loan accrues interest of 18% per annum of which 13% is payable in cash monthly and 5% is payable in kind (PIK). Pursuant to the Loan Agreement, the Loan is secured by substantially all of the assets of the Company including but not limited to the Company’s residual portfolios. In addition, certain of Excel’s subsidiaries are guarantors under the Loan Agreement. The Company incurred financing costs in the amount of $850,746 in connection with the Loan Agreement. These costs are shown as a reduction of the loan amount on the accompanying consolidated balance sheet as of December 31, 2016, and are being amortized as interest expense over the term of the Loan. In addition, the interest that is payable in kind is added to the Loan balance. The following chart summarizes the amount outstanding under the Loan. December 31, Term Loan $ 13,500,000 Net deferred financing costs (803,482 ) Accrued interest payable in kind 112,734 Note payable $ 12,809,252 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 13. RELATED PARTY TRANSACTIONS On October 15, 2015, SME Funding LLC purchased a residual portfolio of $13,000 of monthly recurring revenue from the Company in exchange for $445,742. SME is wholly owned by Steven Lemma who was the Chief Executive Officer of the Securus. The $445,742 was recorded as a gain on the sale of residual portfolio on the accompanying statements of operations. On October 23, 2015, SME Funding LLC advanced the Company $500,000 to help finance the acquisition of the US assets of Calpian by eVance. This advance was converted into a note maturing December 1, 2016 with interest only payable monthly at an annual rate of 12%. The note was repaid in November 2016. On February 15, 2016, SME Funding LLC purchased $35,000 of monthly recurring revenue for $700,000 cash pursuant to a residual purchase agreement (“RPA”). In November 2016, the Company exercised its right to repurchase the residuals for $770,000. As a result of the repurchase option, the Company accounted for the transaction not as a sale but as a liability. |
Summary of Significant Accoun21
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company’s financial statements are prepared on the accrual method of accounting. The consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for annual financial reporting. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Excel Corporation and subsidiaries in which the Company has a controlling financial interest. All intercompany transactions and account balances between Excel Corporation and its subsidiaries have been eliminated in consolidation. Transactions with its consolidated subsidiaries are generally settled in cash. Investments in unconsolidated affiliated entities are accounted for under the equity method and are included in “Equity investment” in the accompanying consolidated balance sheets. |
Business Combinations | Business Combinations Acquisitions are accounted for using the acquisition method of accounting. The purchase price of an acquisition is allocated to the assets acquired and liabilities assumed using the estimated fair values at the acquisition date. Transaction costs are expensed as incurred. |
Goodwill | Goodwill Goodwill represents the excess of acquisition cost over the fair value of net tangible and intangible assets acquired in connection with an acquisition. Goodwill is assessed for impairment annually or more frequently if circumstances indicate impairment may have occurred. |
Revenue Recognition | Revenue Recognition The Company receives a percentage of recurring monthly transaction related fees comprised of credit and debit card fees charged to merchants, net of association fees, otherwise known as Interchange, as well as certain service charges and convenience fees, for payment processing services, including authorization, capture, clearing, settlement and information reporting of electronic transactions. Fees are calculated on either a percentage of the dollar volume of the transaction or a fixed fee or a hybrid of the two and are recognized at the time of the transaction. In the case of “wholesale” residual revenue in which the Company has a direct contractual relationship with the merchant, bears risk of chargebacks and performs underwriting on the merchants, the Company records the full discount charged to the merchant as revenue and the related interchange and other processing fees as expenses. In cases of residual revenue where the Company is not responsible for merchant underwriting and has no chargeback liability and has no or limited contractual relationship with the merchant, the Company records the amount it receives from the processor net of interchange and other processing fees as revenue. The Company acts as an ISO offering alternative financing and working capital solutions (merchant cash advances) to small and medium sized businesses using a variety of third party funding sources. As an ISO, we earn commissions from capital funders by placing their financial products with our merchant customers. This portion of our business does not yet represent a significant portion of our revenues, costs or assets. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all cash accounts, which are not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less as cash and cash equivalents. The carrying amount of financial instruments included in cash and cash equivalents approximates fair value because of the short maturities for the instruments held. |
Income Taxes | Income Taxes Income taxes are provided for the tax effects of the transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to tax net operating loss carryforwards. The deferred tax assets and liabilities represent the future tax return consequences of these differences, which will either be taxable or deductible when assets and liabilities are recovered or settled, as well as operating loss carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established against deferred tax assets when in the judgment of management, it is more likely than not that such deferred tax assets will not become available. Because the judgment about the level of future taxable income is dependent to a great extent on matters that may, at least in part, be beyond the Company’s control, it is at least reasonably possible that management’s judgment about the need for a valuation allowance for deferred taxes could change in the near term. |
Reclassification | Reclassification Certain prior period amounts have been reclassified to conform to the current year’s presentation. |
Accounts Receivable | Accounts Receivable Accounts receivable represent contractual residual payments due from the Company's processing partners. These residual payments are determined based on transaction fees and revenues from the credit and debit card processing activity of merchants for which the Company’s processing partners pay the Company. Based on collection experience and periodic reviews of outstanding receivables, management considers all accounts receivable to be fully collectible and accordingly, no allowance for doubtful accounts is required. |
Property and Equipment | Property and Equipment Property and equipment is stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment is calculated using the straight-line method over the estimated useful lives of the assets, which range from five to ten years. Leasehold improvements are amortized over the lesser of the expected term of the lease or the estimated useful life of the asset. Expenditures for repairs and maintenance are expensed as incurred. |
Residual Portfolios | Residual Portfolios Residual portfolios are valued at fair value on the date of acquisition and are amortized over their estimated useful lives (7 years). |
Equity Investments | Equity Investments Equity investments are valued at fair value on the date of acquisition using the equity method of accounting and adjusted in subsequent periods for the Company’s share of the investment’s earnings and distributions. |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the evaluation of deferred tax assets, purchase accounting, allowances, and equity investments. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Discontinued Operations [Abstract] | |
Schedule of discontinued operations | For the Years ended 2016 2015 Revenues $ 2,027,684 $ 11,970,092 Operating expenses (4,216,255 ) (15,670,162 ) Pre-tax loss from discontinued operations (2,188,571 ) (3,700,070 ) Loss from discontinued operations, net of tax $ (2,188,571 ) $ (3,700,070 ) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Taxes [Abstract] | |
Schedule reconciliation of statutory rate | For the Year Ended December 31, 2016 For the Year Ended December 31, 2015 Statutory Rate (34 )% (34 )% State income tax, net of federal income tax benefit (3 )% (3 )% Valuation Allowance 37 % 37 % Effective Rate 0 % 0 % |
Schedule of provision for income taxes | For the Year Ended December 31, 2016 For the Year Ended December 31, 2015 Income Tax Expense Continuing Operations Discontinued Operations Total Continuing Operations Discontinued Operations Total Current $ 456,230 $ (1,120,808 ) $ (664,578 ) $ 768,703 $ (1,369,026 ) $ (600,323 ) Deferred (456,230 ) 1,120,808 664,578 (768,703 ) 1,369,026 600,323 Total $ - $ - $ - $ - $ - $ - |
Schedule of deferred income taxes | For the Years Ended December 31, 2016 2015 Deferred Tax Assets Net operating loss carryforwards $ 1,493,916 $ 452,452 Accrued compensation 128,253 289,523 Other accrued liabilities (74,125 ) 52,503 Depreciation and amortization 3,860 34,860 Total deferred tax assets 1,551,904 829,338 Valuation allowance (1,551,904 ) (829,338 ) Net deferred tax asset - - Deferred tax liabilities - - |
Stock Option and Compensation (
Stock Option and Compensation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Stock Options and Compensation [Abstract] | |
Schedule of restricted stock grants | For the Years Ended December 31, Restricted Stock Grants 2016 2015 Shares outstanding on January 1 7,465,608 5,465,608 Granted 1,000,000 2,000,000 Forfeited (1,500,000 ) — Shares outstanding on December 31 6,965,608 7,465,608 Shares vested at December 31 6,632,274 4,143,739 |
Schedule of stock options, activity | For the Years Ended December 31, Stock Options 2016 2015 Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Options outstanding at January 1 1,000,000 $ .09 1,000,000 $ 0.09 Granted — — — — Exercised — — — — Forfeited 1,000,000 $ .09 — — Options outstanding December 31 — — 1,000,000 $ 0.09 Shares exercisable at December 31 — — 444,448 $ 0.09 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Acquisitions [Abstract] | |
Summary of estimated fair values of assets acquired and liabilites assumed | Cash and cash equivalents $ 257,886 Accounts receivable 461,647 Other current assets 167,058 Property and equipment, net 174,403 Residual portfolios 2,540,690 Equity investments 164,790 Deposits 532,617 Total assets 4,299,091 Accounts payable 25,000 Accrued liabilities 143,089 Total liabilities 168,089 Fair value of net assets acquired $ 4,131,002 Calpian note received $ 675,000 Fair value of debt assumed $ 8,279,916 Goodwill recognized on acquisition $ 3,473,914 |
Schedule of selected pro forma financial information | Selected Pro Forma Financial Information Years Ended December 31, 2015 Excel Calpian U.S. Assets Total Revenues $ 5,628,540 $ 14,621,149 $ 20,249,689 Net income (loss) attributable to the Company $ (1,622,494 ) $ 72,942 $ (1,549,552 ) Net income (loss) attributable to the Company per common share - basic and diluted $ (0.02 ) $ 0.001 $ (0.02 ) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property and Equipment [Abstract] | |
Schedule of property and equipment | December 31, December 31, Computer software $ 38,607 35,595 Equipment 163,394 123,074 Furniture & fixtures 38,882 33,336 Leasehold improvements 16,538 3,471 Total cost 257,421 195,476 Less accumulated depreciation and amortization (86,979 ) (10,516 ) Property and equipment – net $ 170,442 184,960 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
Schedule of future minimum lease payments | 2017 $ 175,091 2018 179,489 2019 174,946 2020 6,430 2021 and after - Total $ 535,956 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Notes Payable [Abstract] | |
Schedule of notes payable | December 31, 2016 December 31, 2015 Note payable to BAV, due in monthly installments of $48,333 through May 2017, including simple interest at 15%, secured by the Company’s residual portfolio $ - $ 681,361 Note payable to SME Funding LLC, due December 1,2016, bearing simple interest at 12%, secured by the Company’s residual portfolio - 500,000 Notes payable due December 1, 2016, bearing interest at 12%, secured by the assets of eVance - 8,029,916 Term Loan due November 2019, bearing interest at 18%, secured by substantially all of the assets of the Company 12,809,252 - Total 12,809,252 9,211,277 Less current portion 12,809,252 (8,984,544 ) Long-term portion of notes payable $ - $ 226,733 |
Schedule of GACP Term Loan | December 31, Term Loan $ 13,500,000 Net deferred financing costs (803,482 ) Accrued interest payable in kind 112,734 Note payable $ 12,809,252 |
Organization and Operations (De
Organization and Operations (Details) | Apr. 30, 2016Merchants | Apr. 12, 2016USD ($)shares | Nov. 30, 2015USD ($) | Dec. 31, 2016USD ($)Subsidiary |
Organization and Operations (Textual) | ||||
Notes payable | $ 9,000,000 | |||
Number of wholly owned subsidiaries | Subsidiary | 3 | |||
Reduction goodwill | $ 720,084,000 | |||
eVance Processing Inc. [Member] | ||||
Organization and Operations (Textual) | ||||
Cancelled noteholder amount | $ 720,084 | |||
Notes payable | 675,000 | |||
Litigation cost | $ 675,000 | |||
Bears simple interest rate | 12.00% | |||
Damages claim amount | $ 1,500,000 | |||
Principal amount | $ 675,000 | |||
Reduction goodwill | $ 8,279,916 | |||
Warrant purchase to common stock | shares | 360,042 | |||
Maturity date for re-purchase | Nov. 30, 2017 | |||
Notes payable reduced | $ 8,279,916 | |||
Chyp [Member] | ||||
Organization and Operations (Textual) | ||||
Bears simple interest rate | 12.00% | |||
Number of merchants | Merchants | 5,000 | |||
Maturity date for re-purchase | May 1, 2017 | |||
Description of purchase and sale agreement | Securus entered into a Purchase and Sale Agreement (the "2016 Purchase Agreement") with Chyp LLC ("Chyp"). In connection with the 2016 Purchase Agreement, Chyp executed a three-year preferred marketing agreement with eVance. Chyp acquired substantially all of the operations of Securus including its sales and marketing operations located in Portland Oregon and West Palm Beach Florida. Securus retained the approximately 5,000 merchants and related merchant processing residual portfolios. |
Summary of Significant Accoun30
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of Significant Accounting Policies (Textual) | |
Estimated useful lives residual portfolios | 7 years |
Maximum [Member] | |
Summary of Significant Accounting Policies (Textual) | |
Estimated useful lives of assets | P10Y |
Minimum [Member] | |
Summary of Significant Accounting Policies (Textual) | |
Estimated useful lives of assets | P5Y |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Discontinued Operations [Abstract] | ||
Revenues | $ 2,027,684 | $ 11,970,092 |
Operating expenses | (4,216,255) | (15,670,162) |
Pre-tax loss from discontinued operations | (2,188,571) | (3,700,070) |
Loss from discontinued operations, net of tax | $ (2,188,571) | $ (3,700,070) |
Discontinued Operations (Deta32
Discontinued Operations (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Promissory note | $ 12,809,252 | $ 9,211,277 |
Loss on disposal of operations | $ 840,641 |
Income Taxes (Details)
Income Taxes (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes [Abstract] | ||
Statutory Rate | (34.00%) | (34.00%) |
State income tax, net of federal income tax benefit | (3.00%) | (3.00%) |
Valuation Allowance | 37.00% | 37.00% |
Effective Rate | 0.00% | 0.00% |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Expense | ||
Current | $ 456,230 | $ 768,703 |
Deferred | (456,230) | (768,703) |
Total | ||
Continuing Operations [Member] | ||
Income Tax Expense | ||
Current | 456,230 | 768,703 |
Deferred | (456,230) | (768,703) |
Total | ||
Discontinued Operations [Member] | ||
Income Tax Expense | ||
Current | (1,120,808) | (1,369,026) |
Deferred | 1,120,808 | 1,369,026 |
Total |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Tax Assets | ||
Net operating loss carryforwards | $ 1,493,916 | $ 452,452 |
Accrued compensation | 128,253 | 289,523 |
Other accrued liabilities | (74,125) | 52,503 |
Depreciation and amortization | 3,860 | 34,860 |
Total deferred tax assets | 1,551,904 | 829,338 |
Valuation allowance | (1,551,904) | (829,338) |
Net deferred tax asset | ||
Deferred tax liabilities |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes (Textual) | ||
Net operating loss carryforwards | $ 4,194,335 | $ 2,241,453 |
Percentage of valuation allowance on deferred tax benefit | 100.00% | |
Deferred tax benefits | $ 1,551,904 | $ 829,338 |
Net operating loss carryforwards, Expiration date | Dec. 31, 2035 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - $ / shares | 1 Months Ended | 12 Months Ended | ||
Nov. 30, 2015 | Dec. 31, 2016 | Mar. 18, 2016 | Dec. 31, 2015 | |
Stockholders' Equity (Textual) | ||||
Common stock, par value | $ 0.0001 | $ 0.0001 | ||
Preferred stock, shares issued | ||||
Fair value of maturity date | 5 years | |||
Fair value of risk-free interest rate | 2.23% | |||
Fair value of volatility rate | 8.53% | |||
Calpian Inc., [Member] | ||||
Stockholders' Equity (Textual) | ||||
Warrants issued purchase of common stock | 5,452,458 | |||
Exercise price | $ 0.05 | |||
Warrants expire | Nov. 30, 2025 | |||
Series B Shares [Member] | ||||
Stockholders' Equity (Textual) | ||||
Stock splits | 1-to-1 | |||
Liquidation preference per share | $ 0.05 | |||
Preferred stock, shares issued | 4,600,000 | 0 | ||
Holders preferred stock vote combined shares | 92,000,000 | |||
Preferred stock redemption rights | In addition, the Company has the right at any time after July 18, 2016 to repurchase and retire all but not less than all of the Series B Preferred Stock for $0.05 per share provided that it gives notice to the Holder of the Company's intent to redeem the shares and the Holder does not elect to convert the Series B Shares into Common Stock in lieu of the redemption. | |||
Series B Shares [Member] | Thomas A. Hyde, Jr. [Member] | ||||
Stockholders' Equity (Textual) | ||||
Convertible preferred shares issued | 2,300,000 | |||
Shares issued, price per share | $ 0.05 | |||
Preferred stock voting rights | 20 votes per share | |||
Series B Shares [Member] | Robert L. Winspear [Member] | ||||
Stockholders' Equity (Textual) | ||||
Convertible preferred shares issued | 2,300,000 | |||
Shares issued, price per share | $ 0.05 | |||
Preferred stock voting rights | 20 votes per share |
Stock Option and Compensation38
Stock Option and Compensation (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Begining balance, Shares outstanding | 1,000,000 | 1,000,000 |
Granted | ||
Forfeited | $ 1,000,000 | |
Ending balance, Shares outstanding | 1,000,000 | |
Shares vested, ending balance | $ 1,000,000 | |
Number of options, Exercisable, shares | 444,448 | |
Weighted Average Exercise Price Outstanding, Beginning Balance | $ 0.09 | $ 0.09 |
Weighted Average Exercise Price, Granted | ||
Weighted Average Exercise Price, Exercised | ||
Weighted Average Exercise Price, Forfeited, expired or canceled | 0.09 | |
Weighted Average Exercise Price Outstanding, Ending Balance | 0.09 | |
Weighted Average Exercise Price, Exercisable | $ 0.09 | |
Number of options, Exercised, shares | ||
Restricted Stock Grants [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Begining balance, Shares outstanding | 7,465,608 | 5,465,608 |
Granted | $ 1,000,000 | $ 2,000,000 |
Forfeited | $ (1,500,000) | |
Ending balance, Shares outstanding | 6,965,608 | 7,465,608 |
Shares vested, ending balance | $ 6,632,274 | $ 4,143,739 |
Stock Option and Compensation39
Stock Option and Compensation (Details Textual) - $ / shares | Aug. 12, 2016 | Jun. 01, 2015 | Nov. 13, 2010 | Dec. 31, 2016 |
Stock Option and Compensation (Textual) | ||||
Maximum shares of common stock issued | 4,000,000 | |||
Description under stock option plan | Options under the plan are to be issued at the market price of the stock on the day of the grant except to those issued to holders of 10% or more of the Company's Common Stock which is required to be issued at a price not less than 110% of the fair market value on the day of the grant. | |||
Percentage of fair market value | 110.00% | |||
Term period | 18 months | 10 years | ||
Shares issued for vested | 500,000 | |||
Vesting rights, description | Company granted 1,000,000 shares of its common stock to an employee. 333,333 of these shares vested immediately, 333,333 vest on December 1, 2016 and 333,334 vest on December 1, 2017. | |||
Issued a warrant to purchase of common stock | 500,000 | |||
Warrants exercise price | $ 0.06 | |||
Description of term in excess | No option shall have a term in excess of 10 years from the date of the grant. | |||
Executive [Member] | ||||
Stock Option and Compensation (Textual) | ||||
Stock issued during period, Shares | 2,000,000 | |||
June 1, 2016 [Member] | ||||
Stock Option and Compensation (Textual) | ||||
Stock issued during period, Shares | 500,000 | |||
June 1, 2017 [Member] | ||||
Stock Option and Compensation (Textual) | ||||
Stock issued during period, Shares | 500,000 | |||
June 1, 2018 [Member] | ||||
Stock Option and Compensation (Textual) | ||||
Stock issued during period, Shares | 500,000 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 | Nov. 30, 2015 |
Summary of estimated fair values of assets acquired and liabilites assumed | |||
Cash and cash equivalents | $ 257,886 | ||
Accounts receivable | 461,647 | ||
Other current assets | 167,058 | ||
Property and equipment, net | 174,403 | ||
Residual portfolios | 2,540,690 | ||
Equity investments | 164,790 | ||
Deposits | 532,617 | ||
Total assets | 4,299,091 | ||
Accounts payable | 25,000 | ||
Accrued liabilities | 143,089 | ||
Total liabilities | 168,089 | ||
Fair value of net assets acquired | 4,131,002 | ||
Calpian note received | $ 675,000 | $ 675,000 | 675,000 |
Fair value of debt assumed | 8,279,916 | ||
Goodwill recognized on acquisition | $ 7,914,269 | $ 7,914,269 | $ 3,473,914 |
Acquisitions (Details 1)
Acquisitions (Details 1) | 12 Months Ended |
Dec. 31, 2015USD ($)$ / shares | |
Schedule of selected pro forma financial information | |
Revenues | $ 20,249,689 |
Net income (loss) attributable to the Company | $ (1,549,552) |
Net income (loss) attributable to the Company per common share - basic and diluted | $ / shares | $ (0.02) |
Excel [Member] | |
Schedule of selected pro forma financial information | |
Revenues | $ 5,628,540 |
Net income (loss) attributable to the Company | $ (1,622,494) |
Net income (loss) attributable to the Company per common share - basic and diluted | $ / shares | $ (0.02) |
Calpian U.S. Assets [Member] | |
Schedule of selected pro forma financial information | |
Revenues | $ 14,621,149 |
Net income (loss) attributable to the Company | $ 72,942 |
Net income (loss) attributable to the Company per common share - basic and diluted | $ / shares | $ 0.001 |
Acquisitions (Details Textuals)
Acquisitions (Details Textuals) - USD ($) | Apr. 12, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Nov. 30, 2015 |
Acquisitions (Textuals) | ||||
Goodwill recognized on acquisition | $ 7,914,269 | $ 7,914,269 | $ 3,473,914 | |
Notes payable | 12,809,252 | 9,211,277 | ||
Warrant to purchase of common stock shares | 360,042 | |||
Reduction in goodwill and debt assumed | $ 720,084 | |||
Revenues | 17,115,210 | 5,629,240 | ||
Net income | $ (1,796,157) | (1,622,494) | ||
Residual Purchase Agreement [Member] | ||||
Acquisitions (Textuals) | ||||
Loss contingency,litigation description | Purchase Agreement, eVance acquired several residual portfolios including the supporting contracts (residual purchase agreements). eVance, as successor under one of these residual purchase agreements, has sued a third party for breach of contract on the residual purchase agreement between the third party and Seller and has claimed damages in excess of $1,500,000. eVance has agreed to apply any recovery from such litigation (less costs) against the principle balance of the $675,000 note up to a maximum of $675,000. | |||
eVance Processing Inc. [Member] | ||||
Acquisitions (Textuals) | ||||
Notes payable aggregate amount | 9,000,000 | |||
Principal amount | $ 675,000 | |||
Litigation amount | 675,000 | |||
Notes payable | $ 720,084 | $ 9,000,000 | ||
Interest rate | 12.00% | |||
Revenues | 1,022,073 | |||
Net income | $ 64,965 | |||
Calpian [Member] | ||||
Acquisitions (Textuals) | ||||
Notes payable | $ 675,000 | |||
Reduction in goodwill and debt assumed | $ 1,395,084 | |||
Common stock issued, shares | 2,000,000 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 257,421 | $ 195,476 |
Less accumulated depreciation and amortization | (86,979) | (10,516) |
Property and equipment - net | 170,442 | 184,960 |
Computer software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 38,607 | 35,595 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 163,394 | 123,074 |
Furniture & fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 38,882 | 33,336 |
Leasehold improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 16,538 | $ 3,471 |
Leases (Details)
Leases (Details) | Dec. 31, 2016USD ($) |
Future Minimum Lease Payments | |
2,017 | $ 175,091 |
2,018 | 179,489 |
2,019 | 174,946 |
2,020 | 6,430 |
2021 and after | |
Total | $ 535,956 |
Leases (Details Textual)
Leases (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Operating Loss Carryforwards [Line Items] | ||
Rent expense | $ 298,816 | $ 438,109 |
Operating lease term | 63 months | |
Irving Texas [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Operating lease expiration date | Nov. 1, 2014 | |
Irving Texas [Member] | Maximum [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Monthly lease payments | $ 6,428 | |
Irving Texas [Member] | Minimum [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Monthly lease payments | $ 0 | |
Georgia [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Operating lease expiration date | Nov. 30, 2019 | |
Georgia [Member] | Maximum [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Monthly lease payments | $ 9,046 | |
Georgia [Member] | Minimum [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Monthly lease payments | $ 8,278 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Notes payable | $ 12,809,252 | $ 9,211,277 |
Less current portion | 12,809,252 | 8,984,544 |
Long-term portion of notes payable | 226,733 | |
Secured Debt [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | 681,361 | |
Secured Debt One [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | 500,000 | |
Secured Debt Two [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | 8,029,916 | |
Secured Debt Four [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 12,809,252 |
Notes Payable (Details 1)
Notes Payable (Details 1) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Notes Payable [Abstract] | ||
Term Loan | $ 13,500,000 | |
Net deferred financing costs | (803,482) | |
Accrued interest payable in kind | 112,734 | |
Notes payable | $ 12,809,252 | $ 9,211,277 |
Notes Payable (Details Textual)
Notes Payable (Details Textual) - USD ($) | Nov. 02, 2016 | Apr. 12, 2016 | Oct. 23, 2015 | Nov. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 |
Notes Payable (Textual) | ||||||
Notes payable | $ 12,809,252 | $ 9,211,277 | ||||
Reduction of note principal value | $ 720,084,000 | |||||
Accrue interest, Description | The Loan accrues interest of 18% per annum of which 13% is payable in cash monthly and 5% is payable in kind (PIK). | |||||
Financing costs | $ 850,746 | |||||
Loan Agreement [Member] | ||||||
Notes Payable (Textual) | ||||||
Loan agreement term | 3 years | |||||
Term loan commitments | $ 25,000,000 | |||||
eVance [Member] | ||||||
Notes Payable (Textual) | ||||||
Maturity date for re-purchase | Nov. 30, 2017 | |||||
Notes payable | $ 720,084 | $ 9,000,000 | ||||
Amount of debt issued pursuant to note offering | 6,000,000 | |||||
Invested amount | 250,000 | |||||
Aggregate amount of indebtedness | 9,000,000 | |||||
Reduction of note principal value | $ 8,279,916 | |||||
Consolidation eliminated reflect [Member] | ||||||
Notes Payable (Textual) | ||||||
Notes payable | 8,029,916 | |||||
Notes Purchased | 250,000 | |||||
SME Funding LLC [Member] | ||||||
Notes Payable (Textual) | ||||||
Maturity date for re-purchase | Dec. 1, 2016 | |||||
Advance from related parties | $ 500,000 | |||||
Annual rate of interest | 12.00% | |||||
Secured Debt [Member] | ||||||
Notes Payable (Textual) | ||||||
Monthly installments | $ 48,333 | |||||
Interest Rate | 15.00% | |||||
Maturity date for re-purchase | May 31, 2017 | |||||
Notes payable | 681,361 | |||||
Secured Debt One [Member] | ||||||
Notes Payable (Textual) | ||||||
Interest Rate | 12.00% | |||||
Maturity date for re-purchase | Dec. 1, 2016 | |||||
Notes payable | 500,000 | |||||
Secured Debt Four [Member] | ||||||
Notes Payable (Textual) | ||||||
Interest Rate | 18.00% | |||||
Maturity date for re-purchase | Nov. 30, 2019 | |||||
Notes payable | $ 12,809,252 | |||||
Secured Debt Two [Member] | ||||||
Notes Payable (Textual) | ||||||
Interest Rate | 12.00% | |||||
Maturity date for re-purchase | Dec. 1, 2016 | |||||
Notes payable | $ 8,029,916 | |||||
Term Loan [Member] | Loan Agreement [Member] | ||||||
Notes Payable (Textual) | ||||||
Term loan commitments | 11,500,000 | |||||
Initial Term Loan [Member] | Loan Agreement [Member] | ||||||
Notes Payable (Textual) | ||||||
Term loan commitments | $ 13,500,000 |
Related Party Transactions (Det
Related Party Transactions (Details) - SME Funding LLC [Member] - USD ($) | Oct. 23, 2015 | Feb. 15, 2016 |
Related Party Transactions (Textual) | ||
Advance from related parties | $ 500,000 | |
Annual rate of interest | 12.00% | |
Residual Purchase Agreement [Member] | ||
Related Party Transactions (Textual) | ||
Monthly recurring revenue | $ 13,000 | |
Advance from related parties | 445,742 | |
Gain on sale of residual portfolio | 445,742 | |
Sale of residual portfolio to SME Funding LLC | 35,000 | |
Residual purchase agreement | $ 700,000 | |
Right to repurchase the residuals | $ 770,000 |