IEG HOLDINGS CORPORATION (OTCMKTS:IEGH) Files An 8-K Regulation FD DisclosureItem 7.01. Regulation FD Information.
On June 21, 2017, IEG Holdings Corporation (the “Company”) filed with the Securities and Exchange Commission (the “Commission”) a preliminary information statement on Schedule 14C (the “Preliminary Information Statement”). The Preliminary Information Statement, though not in definitive form, related to a vote by the Company’s sole director and holder of a majority of the voting power of the issued and outstanding capital stock of the Company to effect a reverse 1-for-1,000 stock split (the “Reverse Split”), followed immediately by a forward 1,000-for-1 stock split (the “Forward Split”) of the Company’s common stock. The Company’s intention was that registered shareholders whose shares of stock were converted into less than one share in the Reverse Split would receive cash payments equal to the fair value of those fractional interests. The Reverse Split and Forward Split, together with the related cash payments to shareholders with less than 1,000 shares of common stock prior to the Reverse Split are referred to herein as the “Reverse/Forward Split.”
On July 18, 2017, the Company determined that it will not effect the Reverse/Forward Split at this time. Furthermore, the Company has no intention of effecting the Reverse/Forward Split or any other reverse and/or forward split in the near future. For avoidance of doubt, no reverse and/or forward split will occur on July 25, 2017, as originally disclosed in the Preliminary Information Statement, and no stockholders will be cashed out on July 25, 2017. Stockholders should disregard the Preliminary Information Statement that was filed with the Commission in its entirety.
The Company’s determination to abandon the Reverse/Forward Split was based on the Company’s launch, on July 12, 2017, of its tender offer (the “Lending Club Tender Offer”) to exchange four shares of the Company’s common stock for each share of common stock of LendingClub Corporation (“Lending Club”), up to an aggregate of 40,345,603 shares of Lending Club common stock, representing approximately 9.99% of Lending Club outstanding shares as of April 28, 2017, validly tendered and not properly withdrawn in the offer. The Company launched the Lending Club Tender Offer on July 12, 2017, subsequent to the filing of the Preliminary Information Statement with the Commission on June 21, 2017. The primary goal of the Reverse/Forward Split was cost savings from reducing administrative costs associated with reducing shareholder accounts. The Company expects that a significant number of new shareholders may be obtained in connection with the Lending Club Tender Offer, including those holding fewer than 1,000 shares. As a result, the Company determined that any expected cost savings may no longer be sufficient to justify proceeding with the Reverse/Forward Split. The Company notes that previously completed reverse/forward stock splits have achieved substantial administrative cost savings, and have not been designed for the purpose of “going private”.
About IEG HOLDINGS CORPORATION (OTCMKTS:IEGH)
IEG Holdings Corporation is a consumer finance company. The Company is engaged in the business of providing unsecured consumer loans ranging from $2,000 to $10,000. The Company operates in Consumer Loans segment. It offers loans online under the consumer brand Mr. Amazing Loans through its Website and online application portal at www.mramazingloans.com. It has obtained additional state lending licenses, and are licensed and originating direct consumer loans in the states of Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana, Missouri, Nevada, New Jersey, New Mexico, Oregon, Pennsylvania, Texas, Utah and Virginia. It has approximately 80 loans in default representing over 4.81% of the number of loans in its active portfolio. Its subsidiaries include Investment Evolution Corporation, which holds state licenses, leases, employee contracts, and other operating and administrative expenses, and IEC SPV, LLC, which is a bankruptcy remote special purpose vehicle.