12. Discontinued Operations | 12. DISCONTINUED OPERATIONS Sale of Instilend Technologies, Inc. On May 2, 2013, the Company, its wholly-owned subsidiary, Instilend Technologies Inc. ("Instilend") and Fortified Management Group, LLC ("Fortified") entered into an Asset Purchase Agreement (the "APA"), pursuant to which Instilend sold all of its assets, including its proprietary Matador, Locate Stock and LendEQS platforms, to Fortified in consideration of $3,000,000 (the "Purchase Price") consisting of 250,000 shares of common stock of the Company which were returned to the Company for cancellation in March of 2013, $2,500 per month commencing on the 90th day after the Closing Date which will be increased to $5,000 per month as of the 270th day following the Closing Date, a Secured Promissory Note in the principal amount of $1,250,000 (the "APA Note"), the assumption by Fortified from the Company of 5% Convertible Promissory Notes (the "Seller Notes") originally issued by the Company to Todd Tabacco, Derek Tabacco and Richard L'Insalata in the aggregate amount of $500,000 and additional monthly royalties of 5% after the payment of the $1,250,000 Secured Promissory Note up to $4,000,000 as set forth in Schedule 3 of the APA. In addition, $150,000 of the Purchase Price (the "Escrow Funds") were used towards the payment by the Company of certain tax liabilities owed by Instilend. The Escrow Funds will be held in escrow until the Company has entered into settlement agreements with the relevant tax authorities, at which time the Company may authorize the Escrow Funds to be released for payment to the relevant tax authorities. In the event of a failure by the Company to make any payments in accordance with the terms of any such settlement agreements, the Company will issue shares of its common stock to Fortified equal to three times the unpaid amount of the remaining unpaid tax liabilities. As a result of the sale of the operating assets relating to the stock loan business, management of the Company, as of the Closing Date, elected to impair the remaining assets in the business including the goodwill, customer list and covenants to not compete. The impaired assets were initially recorded as a result of the acquisition of Instilend. The assets and liabilities of the discontinued operations as of December 31, 2015 and March 31, 2015 relating to Instilend were as follows: December 31, 2015 March 31, 2015 Cash $ - $ - Accounts receivable - - Total current assets of discontinued operations $ - $ - Liabilities: Accounts payable $ 120,266 $ 120,266 Total current liabilities of discontinued operations $ 120,266 $ 120,266 Vickrey Brown Investments LLC and SAFE Management LLC On December 27, 2015, the Company entered into a Second Amended and Restated Operating Agreement whereby the Company surrendered its equity ownership in Vickrey Brown Investments LLC and transferred ownership of SAFE Management LLC (“Safe”) in exchange for 25% of all revenue generated by Vickrey Brown Investments, LLC until an aggregate of $120,000 has been paid and 30.6% of remaining and future revenue. As such, the Company reclassified operating activities of Vickrey Brown Investments, LLC and Safe to discontinued operations. December 31, 2015 March 31, 2015 Cash $ - $ 9,570 Accounts receivable - 57,076 Total current assets of discontinued operations $ - $ 66,646 Liabilities: Accounts payable $ - $ 54,311 Total current liabilities of discontinued operations $ - $ 54,311 GGI, Inc. On December 4, 2014, the Company formed GGI Inc., a corporation organized under the laws of Delaware for the purchase certain assets including the source code and platform use for the development of an electronic marketplace to facilitate impact investing. On December 27, 2014, the Company exchanged 21% ownership of GGI Inc. for two employment agreements. In connection with the aforementioned exchange, the Company charged 21% of the fair value of the net assets distributed of $338,050 as employee compensation expense. On March 13, 2015, the Company sold GGI, Inc. in exchange for $1,147,500 cash, assumption of $579,452 of debt and return of an aggregate of 1,350,000 shares of the Company’s common stock previously issued to acquire CertusHoldings, Inc. The Results of Operations classified as discontinued operations for the three months ended December 31, 2015: Vickrey Brown Investments SAFE Management Instilend Technologies Total Sales $ - $ - $ - $ - Operating costs: Selling, general and administrative (798) 595 - (203) Net loss before income tax benefit 798 (595) - 203 Income tax benefit - - - - Net loss before non-controlling interest 798 (595) - 203 Non-controlling interest (391) - - (391) Net loss $ (407) $ (595) $ - $ (188) The Results of Operations classified as discontinued operations for the nine months ended December 31, 2015: Vickrey Brown Investments SAFE Management Instilend Technologies Total Sales $ 2,960 $ 4,657 $ - $ 7,617 Operating costs: Selling, general and administrative 38,986 33,681 - 72,667 Net loss before income tax benefit (36,026) (29,024) - (65,050) Income tax benefit - - - - Net loss before non-controlling interest (36,026) (29,024) - (65,050) Non-controlling interest 17,653 - - 17,653 Net loss $ (18,373) $ (29,024) $ - $ (47,397) The Results of Operations classified as discontinued operations for the three months ended December 31, 2014: Vickrey Brown Investments SAFE Management Instilend Technologies GGI, Inc. Total Sales $ - $ 2,179 $ - $ - $ 2,179 Operating costs: Selling, general and administrative 70,677 7,500 (232,668) 351,465 196,974 Net loss before income tax benefit (70,677) (5,321) 232,668 (351,465) (194,795) Income tax benefit - - - - - Net loss before non-controlling interest (70,677) (5,321) 232,668 (351,465) (194,795) Non-controlling interest 29,222 - - 73,808 103,030 Net loss $ (41,455) $ (5,321) $ 232,668 $ (277,657) $ (91,765) The Results of Operations classified as discontinued operations for the nine months ended December 31, 2014: Vickrey Brown Investments SAFE Management Instilend Technologies GGI, Inc. Total Sales $ 10,000 $ 5,244 $ - $ - $ 15,244 Operating costs: Selling, general and administrative 93,649 25,687 (232,668) 351,465 238,133 Net loss before income tax benefit (83,649) (20,443) 232,668 (351,465) (222,889) Income tax benefit - - - - - Net loss before non-controlling interest (83,649) (20,443) 232,668 (351,465) (222,889) Non-controlling interest 40,988 - - 73,808 114,796 Net loss $ (42,661) $ (20,443) $ 232,668 $ (277,657) $(108,093) |