UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 20172018

OR

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 000-55463

IEG Holdings CorporationMR. AMAZING LOANS CORPORATION

(Exact name of registrant as specified in its charter)

(702) 227-5626

(Registrant’s telephone number, including area code)

Securities registered under Section 12(b) of the Act:None

Securities registered under Section 12(g) of the Act:Common Stock, par value $0.001 per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [  ] No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [  ] No [X]

[X] Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [X]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [  ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] No [X]

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter.

As of June 30, 2017,29, 2018, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was $6,437,272.60$2,534,747.76 based on the last reported sale price of our common stock on the OTCQB, which was $1.10$0.24 per share on June 30, 2017.29, 2018.

As of March 28, 2018,2019, there were 17,463,44917,226,283 shares of the registrant’s common stock issued and outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None.

Table of Contents

FORWARD-LOOKING STATEMENTS

This annual report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Securities and Exchange Commission (the “SEC”) encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects and make informed investment decisions. This annual report on Form 10-K and other written and oral statements that we make from time to time contain such forward-looking statements that set out anticipated results based on management’s plans and assumptions regarding future events or performance. We have tried, wherever possible, to identify such statements by using words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial performance. In particular, these include statements relating to future actions, future performance or results of current and anticipated sales efforts, expenses, the outcome of contingencies, such as legal proceedings, and financial results. Factors that could cause our actual results of operations and financial condition to differ materially are discussed in greater detail under Item 1A - “Risk Factors” of this annual report on Form 10-K.

We caution that the factors described herein and other factors could cause our actual results of operations and financial condition to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

PART I

ITEM 1. BUSINESS

Business Overview

IEG HoldingsMr. Amazing Loans Corporation (“IEG Holdings,Mr. Amazing Loans,” the “Company,” “we,” “us,” or “our”) is a fintech company that provides unsecured online consumer loans under the brand name “Mr. Amazing Loans” via our website and online application portal at www.mramazingloans.com. Fintech companies, such as IEG Holdings,Mr. Amazing Loans, apply technology to improve financial services. We started our business and opened our first office in Las Vegas, Nevada in 2010. We currently offer $5,000 and $10,000 unsecured consumer loans that mature in five years. We are currently licensed and/or hold certificates of authority and are originating direct consumer loans in 2019 states – Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana, Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah Virginia and Wisconsin.Virginia. We provide loans to residents of these states through our online application portal, with all loans originated, processed and serviced out of our centralized Las Vegas head office, which eliminates the need for physical offices in all of these states.

Our strategy is to address the market needs of underbanked consumers that tend to be ignored by mainstream institutional credit providers such as banks and credit unions, and are charged excessive fees and interest by fringe lenders such as payday lenders. In the current global environment, we believe there is a substantial need and opportunity for the small personal loans we offer.

All of our personal loans are offered at prevailing statutory rates with fixed affordable repayments and no prepayment penalties. We conduct full underwriting on all applications including credit checks and review of bank statements to ensure customers have capacity to repay their loans, and have designed our loans to help customers reach a stronger financial position.loans.

OneMain Tender Offer

On January 5, 2017, we launched a tender offer for shares of OneMain Holdings, Inc. (“OneMain”) common stock (the “OneMain Tender Offer”). In our tender offer materials relating to the OneMain Tender Offer, we indicated that we intended to use our OneMain stockholdings to become an activist investor, to pressure OneMain to transform its “brick and mortar” business model to our online-only distribution business model. The OneMain Tender Offer was undersubscribed, with stockholders representing approximately 0.1% of OneMain’s outstanding shares tendering their shares. On June 16, 2017, IEG Holdingswe closed the OneMain Tender Offer, with 151,994 OneMain shares of common stock acquired (valued at an aggregate of $3.6 million based on the closing price of shares of OneMain common stock of $23.38 on June 15, 2017) in exchange for 3,039,880 shares of IEG Holdings’our common stock.

On June 16, 2017, we sent a letter to OneMain’s Chief Executive Officer and board of directors with the following activist stockholder demands:

We indicated in our letter that we intended, in our role as an activist investor, to:

This was the only contact that IEG Holdingswe had with OneMain following expiration of the OneMain Tender Offer. On June 22, 2017, the fifth business day following termination of the OneMain Tender Offer, IEG Holdingswe sold 100% of itsour OneMain shares (an aggregate of 151,994 shares, which represented approximately 0.1% of OneMain’s outstanding shares) in exchange for approximately $3.4 million in cash due to lack of response from OneMain’s management, an undersubscribed tender offer and what management believed, based on the low level of tendering stockholders, to be a lack of OneMain stockholder support for the proposed business changes. Had management perceived greater OneMain stockholder support for the proposed business changes or OneMain management demonstrated a willingness to enter into discussions, IEG Holdingswe likely would have considered retaining its stake in OneMain for a longer period of time or indefinitely. TheOur sale of the tendered OneMain shares by IEG Holdings significantly increased IEG Holdings’our capital and net asset value and resulted in a substantial increase in lending in the third and fourth quarters ending December 31, 2017. Despite IEG Holdings’our desire to effect changes in OneMain’s management, IEG Holdingswe did not include a minimum tender condition in itsour offer because IEG Holdingswe determined that the acquisition of any OneMain shares under the OneMain Tender Offer could add stockholder value by increasing IEG Holdings’our capital and net asset value.

On July 1, 2017, we and our Chief Executive Officer, Mr. Paul Mathieson who is also the sole member of our Board of Directors, agreed to terminate, effective July 1, 2017, the consulting contract dated January 1, 2017 between our Chief Executive Officer and the Company pursuant to which the Company was required to pay Mr. Mathieson $1 annually in exchange for certain consulting services. Concurrently with the termination of that consulting contract, IEC, and Mr. Mathieson entered into a new professional consulting contract, effective as of July 1, 2017 (the “Professional Consulting Contract”). Pursuant to the terms of the Professional Consulting Contract, Mr. Mathieson agreed to provide regulatory and management consulting services as requested by the Company and/or IEC. The Professional Consulting Contract has a term of 1.5 years and renews automatically for successive one-year periods unless notice of termination is provided 30 days prior to the automatic renewal date. In exchange for the services provided to the Company and/or IEC by our Chief Executive Officer, IEC agreed to pay him $1,200,000 annually in quarterly payments of $300,000 due in advance each quarter and to provide health insurance benefits as well as a discretionary bonus to be determined by the Company’s Board of Directors, which consists solely of Mr. Mathieson.

Following the sale of the OneMain shares acquired in the OneMain Tender Offer, we have started to use, and expect to continue to use,used the proceeds from the sale to fund increased new loan volumes and to pay Mr. Mathieson, our Chief Executive Officer and the sole member of our board of directors, amounts owed pursuant to the terms of his Professional Consulting Contract.Contract (as defined below). The current Professional Consulting Contract obligates us to pay Mr. Mathieson $1.2 million annually, plus health insurance and a discretionary bonus to be determined by our sole director. Beginning on July 1, 2018, the July 2017 Consulting Contract will be replaced with a new consulting contract. See “—Recent Developments—Professional Consulting Contract.”annually.

Recent Developments

July 2017 Lending Club Tender Offer

On July 12, 2017, the Companywe filed with the SECSecurities and Exchange Commission (“SEC”) a registration statement on Form S-4 (the “S-4 Registration Statement”) and a Schedule TO relating to the Company’sour offer to exchange four shares of the Company’sour common stock for each share of the common stock of LendingClub Corporation (“Lending Club”), par value $0.01 per share, up to an aggregate of 40,345,603 shares of Lending Club’s common stock, representing approximately 9.99% of the outstanding shares of Lending Club’s common stock as of April 28, 2017, validly tendered and not properly withdrawn in the offer (the “2017 Lending Club Tender Offer”). The 2017 Lending Club Tender Offer and the withdrawal rights were set to expire at 5:00 p.m., Eastern time, on August 10, 2017, unless extended.

Following the launch of the 2017 Lending Club Tender Offer, the price per share of the Company’sour common stock, as quoted on the OTCQB, dropped significantly. On August 1, 2017, due to the drop in the Company’sour stock price, the Companywe determined that the 2017 Lending Club Tender Offer no longer had a reasonable chance of success and accordingly, the Companywe determined that itwe would terminate the 2017 Lending Club Tender Offer and withdraw the S-4 Registration Statement. Any shares that were tendered by Lending Club stockholders were not accepted and were returned to the relevant stockholders. From time to time, the Companywe may consider a future tender offer where it identifieswe identify either business or investment opportunities.

2016 Reverse and Forward Stock Splits

IEG Holdings hasWe have executed and initiated reverse stock splits that have resulted in a reduction in the number of Mr. Amazing Loans stockholders of IEG Holdings and certain stockholders were involuntarily cashed out. In April 2016 and October 2016, we effected reverse and forward stock splits. In each case, stockholders who would otherwise have received fractional shares received cash in exchange for shares of IEG Holdings.our shares. These stockholders were involuntarily cashed out, and the splits were approved by Mr. Mathieson in his capacity as our sole director. The stockholders that were involuntarily cashed out were cashed out at a higher per share price than the then current per share price. Accordingly, the effects of changes in our stock price were positive for such stockholders, as they could choose to repurchase shares at a lower cost per share. As our largest stockholder, sole officer and director, Mr. Mathieson can exercise sole authority over any future reverse stock splits, including the existence of and terms of any reverse stock splits, that could result in stockholders being involuntarily cashed out. Our stockholders should be willing to entrust all aspects of our management to Mr. Mathieson.

Abandonment of Reverse-Forward2017 Proposed Reverse/Forward Stock Split and Cash-Out

On June 21, 2017, the Companywe filed with the SEC 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’sMr. Mathieson, our sole director and holder of a majority of theour voting power of the issued and outstanding capital stock of the Company to effect a reverse 1-for-1,000 stock split (the “Reverse“Proposed Reverse Split”), followed immediately by a forward 1,000-for-1 stock split (the “Forward“Proposed Forward Split”) of the Company’sour common stock. The Company’sOur intention was that registered stockholders whose shares of the Company’sour common stock were converted into less than one share in the Proposed Reverse Split would receive cash payments equal to the fair value of those fractional interests. The Proposed Reverse Split and Proposed Forward Split, together with the related cash payments to stockholders with less than 1,000 shares of the Company’sour common stock prior to the Proposed Reverse Split are referred to herein as the “Reverse/“Proposed Reverse/Forward Split.”

The primary goal of the Proposed Reverse/Forward Split was cost savings from reducing administrative costs associated with stockholder accounts, and the Company believeswe believed that previously completed reverse/forward stock splits havehad achieved substantial administrative cost savings. Neither the Proposed Reverse/Forward Split nor any reverse/forward stock split previously completed by the Companyus were designed for the purposes of or in connection with a “going private” transaction. The board of directorsMr. Mathieson, our sole director and controlling stockholder, approved the Proposed Reverse/Forward Split on June 14, 2017, which was the day before the expiration of the tender offer for shares of OneMain common stock. The boardsole director did not believe the decision to take corporate action to effect the split was a material change to the OneMain Tender Offer as it would have only potentially impacted up to eight of the OneMain stockholders who had accepted the offer who held less than 1,000 IEG HoldingsMr. Amazing Loans shares if they still owned their shares on July 25, 2017. Even if they did still own their shares on July 25, 2017, they would have been provided notice from the Information Statement and could have purchased a small number of extra shares to avoid being repurchased if they did not want to sell or they could have sold on the market at a higher price in the days after the OneMain Tender Offer closed and the Information Statement was filed. The total amount of the repurchase would have been approximately $100,000, would have impacted almost exclusively non-OneMain tendering stockholders and representsrepresented a non-material amount of IEG Holdings’our total assets. The total amount of less than $8,000 for the eight affected OneMain tendering stockholders compared to the approximately $3.55 million worth of OneMain shares acquired in the OneMain Tender Offer iswas not material. The board believessole director believed that the cost savings from the proposedProposed Reverse/Forward Split, though not material, would have been a positive for the OneMain tendering stockholders if it had been effected.

On July 21, 2017, the Companywe announced that itwe would not effect the Proposed Reverse/Forward Split and instructed holders of the Company’sour common stock to disregard the Preliminary Information Statement that was filed with the SEC in its entirety. The Company’sOur determination to abandon the Proposed Reverse/Forward Split was based on the Company’sour launch, on July 12, 2017, of the 2017 Lending Club Tender Offer subsequent to the filing of the Preliminary Information Statement with the SEC on June 21, 2017. The CompanyWe expected that a significant number of individual new stockholders could acquire less than 1,000 shares of the Company’sour common stock in connection with the 2017 Lending Club Tender Offer which could have significantly increased the cost of completing the Proposed Reverse/Forward Split. For the avoidance of doubt, no reverse and/or forward split occurred on July 25, 2017 and no stockholders were cashed out on July 25, 2017. The

Withdrawal of Going Private Transaction

On November 16, 2018, we filed a Schedule 13E-3 and a preliminary information statement on Schedule 14C in connection with our intention to go private. In particular, we intended to reduce the number of record holders of our common stock to fewer than 300, allowing us to terminate the registration of our common stock under Section 12(g) of the Exchange Act and to suspend our reporting obligations under Section 15(d) of the Exchange Act. After the suspension of our duty to file periodic reports and other information with the Securities and Exchange Commission (the “SEC”), the Company has no intention of effectingintended to cease filing reports and information with the Reverse/Forward Split or any other reverse and/or forward splitSEC.

To accomplish the reduction in the near future.number of record holders of our common stock, we intended to effect a 5,001-for-1 reverse stock split followed by a 1-for-5,001 forward stock split of our common stock. Upon completion of the reverse split, stockholders holding only fractional shares were expected to receive a payment equal to the fair value of each share of common stock and would have no further interest in our company.

However, Mr. Mathieson, our sole director, determined that the Company would no longer seek to engage in the going private transaction. Accordingly, on March 20, 2019, we filed an amendment to the Schedule 13E-3 in order to withdraw the Schedule 13E-3, and announced our intention to not proceed with the going private transaction.

Stock Repurchase Program

In January 2017, our Board of Directorssole director approved a stock repurchase program authorizing the open market repurchase of up to $2,000,000 of our common stock for the following reasons:

Purchases under the program arewere authorized through December 31, 2018. As at the close of business on March 28,December 31, 2018, 458,973696,139 shares have beenwere repurchased to date under this program.

On April 1, 2019, the Company announced that its Board of Directors approved a stock repurchase program authorizing the open market repurchase of up to $2,000,000 of its common stock. This share repurchase program expires on December 31, 2019. Management does not intend to repurchase a significant number of shares pursuant to the stock repurchase program.

Declaration of Dividends

Historically, prior to 2017, we did not pay any cash dividends on our common stock. In May 2017, our sole director declaredwe announced the declaration of a cash dividend of $0.005 per common share for the first quarter of 2017. The dividend was paid on August 21, 2017 to stockholders of record at the close of business on June 5, 2017. OnIn August 1, 2017, our sole director declaredwe announced the declaration of a cash dividend of $0.005 per common share for the second quarter of 2017. The dividend was paid on August 21, 2017 to stockholders of record at the close of business on August 11, 2017. OnIn October 30, 2017, weour sole director declared a cash dividend of $0.005 per common share for the third quarter of 2017. The dividend was paid2017 payable on November 20, 2017 to stockholders of record at the close of business on November 11, 2017.

Notes Offering Terminated

In December 2016, we launched a private offering Future dividends, if any, will be determined and paid annually instead of up to $10 million aggregate principal amountquarterly going forward in November each year as the administrative and transfer agent costs and banking currency conversion fees for our predominately international shareholders results in quarterly dividend costs being prohibitive. Payment of our 12% senior unsecured notes due December 31, 2026 (the “Notes”),future dividends on a self-underwritten basis. The Notes offering was terminated in May 2017. No Notes were sold in the offering.

OneMain Holdings, Inc. Tender Offer Closed

On June 16, 2017, we closed the OneMain Tender Offer, pursuant to which we acquired 151,994 shares of theour common stock, of OneMain (valued at an aggregate of approximately $3.55 million based on the closing price of the shares of OneMain’s common stock of $23.38 on June 15, 2017) in exchange for 3,039,880 shares of the Company’s common stock. The per share valuation of the Company’s common stock used as consideration in the OneMain Tender Offer was $1.169 per shareif any, will be at the closing datediscretion of the OneMain Tender Offer. On June 22, 2017, we sold 100% of the 151,994 shares of the common stock of OneMain, which we obtained in the OneMain Tender Offer, on the open market in exchange for $3.4 million in cash. We have begun to use and expect to continue to use the proceeds from the sale of those shares of the common stock of OneMain to fund increased new loan volumes in the second half of 2017 and to pay our Chief Executive Officer and the sole member of our Board of Directors amounts owed pursuant to the terms of the professional consulting contract, effective as of July 1, 2017, between IEC and our Chief Executive Officer.

Amendment of Series H Preferred Stock

On June 20, 2017, we filed articles of amendment (the “June 20 Amendment”) to our amended and restated articles of incorporation, as amended (the “Articles”) with the Florida Secretary of State. The June 20 Amendment has the effect of revising the terms of our Series H preferred stock, par value $0.001 per share (the “Series H Preferred Stock”) to:

The Amendment was approved by our board of directors and will depend on, June 19, 2017.

In addition, on July 26, 2017, we filed additional articlesamong other things, our results of amendment (the “July 26 Amendment”)operations, cash requirements and surplus, financial condition, contractual restrictions and other factors that our board of directors may deem relevant. We may determine to our Articles that hadretain future earnings, if any, for reinvestment in the effect of further revising the terms of the Series H Preferred Stock to increase the conversion ratio of the Series H Preferred Stock from one sharedevelopment and expansion of our common stock per share of the Series H Preferred Stock to four shares of our common stock per share of the Series H Preferred Stock, which may dilute the value of our common stock.

The June 20 Amendment and the July 26 Amendment were approved by our Board of Directors on June 19, 2017 and July 26, 2017, respectively.

Resale Registration Statement Filing

On August 31, 2017, the SEC declared effective the resale registration statement (the “Resale Registration Statement”) filed by the Company on Form S-1 relating to the sale by certain selling stockholders of an aggregate of 9,089,220 shares of the Company’s common stock at a fixed price set by the Company of $3.00 per share. The shares of our common stock registered pursuant to the Resale Registration Statement represent approximately 52% of our outstanding shares of common stock as of March 28, 2018. All 6,900,000 shares of our common stock held by our Chief Executive Officer who is also the sole member of our Board of Directors and holds 39.5% of the issued and outstanding shares of our common stock, were registered for resale under the Resale Registration Statement. The actual value of shares of our common stock may be significantly less than the offering price of $3.00 per share. If the selling stockholders, including our Chief Executive Officer and sole director, sell the shares of our common stock registered under the Resale Registration Statement on the open market, the market price of the Company’s common stock may decline significantly.

Professional Consulting Contract

On July 1, 2017, we and our Chief Executive Officer, Mr. Paul Mathieson who is also the sole member of our Board of Directors, agreed to terminate, effective July 1, 2017, the consulting contract dated January 1, 2017 between our Chief Executive Officer and the Company pursuant to which the Company was required to pay Mr. Mathieson $1 annually in exchange for certain consulting services. Concurrently with the termination of that consulting contract, IEC and Mr. Mathieson entered into a new Professional Consulting Contract, effective as of July 1, 2017. Pursuant to the terms of the Professional Consulting Contract, our Chief Executive Officer agreed to provide regulatory and management consulting services as requested by the Company and/or IEC. The Professional Consulting Contract has a term of 1.5 years and renews automatically for successive one-year periods unless notice of termination is provided 30 days prior to the automatic renewal date. In exchange for the services provided to the Company and/or IEC by our Chief Executive Officer, IEC agreed to pay him $1,200,000 annually in quarterly payments of $300,000 due in advance each quarter and to provide health insurance benefits as well as a discretionary bonus to be determined by the Company’s Board of Directors, which consists solely of Mr. Mathieson.

On March 22, 2018, we entered into a new professional consulting contract with Mr. Mathieson (the “2018 Consulting Contract”) and terminated the July 2017 Consulting Contract, effective July 1, 2018. Pursuant to the terms of the 2018 Consulting Contract, Mr. Mathieson agreed to provide regulatory and management consulting services as requested by IEG Holdings and/or IEC, including the hiring and compensation of IEC personnel, interaction with third party service providers and vendors and, as requested by IEG Holdings, other activities that are designed to assist IEC in conducting business. The term of the 2018 Consulting Contract begins as of July 1, 2018 continues indefinitely unless three months’ written notice of termination is provided by either party.

In exchange for Mr. Mathieson’s services, IEG Holdings agreed to pay Mr. Mathieson an annual base salary of $600,000, which represents a 50% reduction in Mr. Mathieson’s annual salary, as compared to his current annual salary of $1,200,000 payable under Mr. Mathieson’s consulting contract currently in effect (the “2017 Consulting Contract”). Pursuant to the terms of the 2018 Consulting Contract, no bonus is to be paid to Mr. Mathieson by IEG Holdings. Pursuant to the terms of the 2018 Consulting Contract, fees are to be paid quarterly in advance on July 1st, October 1st, January 1st and April 1st beginning on July 1, 2018. Unlike in prior years, IEG Holdings will not pay Mr. Mathieson’s health insurance premiums or any bonuses. Mr. Mathieson will also receive reimbursement for all reasonable expenses incurred for the benefit of IEC, including but not limited to travel expenses for him and his entourage, hotel expenses, communication, security and entertainment expenses.

IEG Holdings expects that, beginning in the third quarter of 2018, its salary and compensation operating expense will be substantially reduced as a result of entry into the 2018 Consulting Contract.

Series H Preferred Stock Issuances & Conversions

On October 30, 2017, the Company completed a private placement of 934,589 shares of the Series H Preferred Stock to four non-U.S. persons. The Company received an aggregate purchase price of $934,589 for the sale of the shares of Series H Preferred Stock and intends to use the proceeds from that sale to expand its operations, including through increased advertising designed to increase the amount and number of loans entered into with customers and to fund operations of the Company. The issuance of shares of Series H Preferred Stock was exempt from the registration requirements of the Securities Act in reliance upon Regulation S promulgated pursuant to the Securities Act.

On December 15, 2017, the Company completed a private placement of 305,000 shares of Series H Preferred Stock to three non-U.S. persons. The Company received an aggregate purchase price of $305,000 for the sale of the shares of Series H Preferred Stock and intends to use the proceeds from that sale to expand its operations, including through increased advertising designed to increase the amount and number of loans entered into with customers and to fund operations of the Company. The issuance of shares of Series H Preferred Stock was exempt from the registration requirements of the Securities Act in reliance upon Regulation S promulgated pursuant to the Securities Act.

On December 28, 2017, the Company completed a private placement of 52,500 shares of Series H Preferred Stock to two non-U.S. persons. The Company received an aggregate purchase price of $52,500 for the sale of the shares of Series H Preferred Stock and intends to use the proceeds from that sale to expand its operations, including through increased advertising designed to increase the amount and number of loans entered into with customers and to fund operations of the Company. The issuance of shares of Series H Preferred Stock was exempt from the registration requirements of the Securities Act in reliance upon Regulation S promulgated pursuant to the Securities Act.

On December 31, 2017, the holders of an aggregate of 1,292,089 shares of Series H preferred stock, representing all of the outstanding Series H Preferred Shares, pursuant to the terms of the Series H Preferred Shares, converted their shares of Series H Preferred Shares, effective December 31, 2017. In accordance with the terms of the Series H Preferred Shares, upon the conversion of such Series H Preferred Shares, the Company issued to the converting holders of Series H Preferred Shares an aggregate of 5,168,356 shares of the Company’s common stock. As a result of the conversion, no Series H Preferred Shares are outstanding. In addition, as a result of the conversion and subsequent issuance of common stock, 17,463,449 shares of the Company’s common stock are issued and outstanding. Due solely to the issuance of common stock, and not as the result of any stock disposition, Paul Mathieson, the Company’s Chairman and Chief Executive Officer, is no longer a majority stockholder. Following the issuance of common stock, Mr. Mathieson owns approximately 39.5% of the Company’s outstanding common stock.

2018 Lending Club Tender Offer

On January 5, 2018, we launched an offer to exchange 13 shares of IEG Holdings’our common stock for each share of common stock of Lending Club, up to an aggregate of 20,701,999 shares of Lending Club common stock, representing approximately 4.99% of Lending Club’s outstanding shares as of October 31, 2017, validly tendered and not properly withdrawn in the offer (the “2018 Lending Club Tender Offer”). On February 20, 2018, we terminated and withdrew the 2018 Lending Club Tender Offer due to a comment that we received from the SEC raising a concern that the 2018 Lending Club Tender Offer was improperly commenced. Any shares that were tendered by Lending Club stockholders were not accepted by us and were promptly returned to the relevant stockholders.

Corporate Name Change toControl of Mr. Amazing Loans Corporation

On March 26, 2018, we filed articles of amendment (the “Amendment”) to our amended and restated articles of incorporation, as amended (the “Articles”) with the Florida Secretary of State. The Amendment has the effect of changing our corporate name from IEG Holdings Corporation to Mr. Amazing Loans Corporation, in order to align our consumer brand (Mr. Amazing Loans) with our corporate name. The Amendment was approved by Mr. Mathieson, our Chief Executive Officer and sole director, and by holders of a majority of the voting power of our voting stock. In connection with the approval of the Amendment by holders of a majority of the voting power of our voting stock, we filed a preliminary information statement on Schedule 14C with the SEC on March 21, 2018. The Amendment and the corporate name change will become effective on the later of (a) the date on which the Financial Industry Regulatory Authority approves the corporate name change, and (b) April 30, 2018; provided, however, that prior to effectiveness of the corporate name change, we must first (i) file a definitive information statement on Schedule 14C with the SEC, which we expect will occur on or about April 2, 2018, (ii) mail copies of the information statement to our stockholders, and (iii) wait at least 20 days from the mailing of the information statement to our stockholders.

Control of IEG Holdings Rests with Mr. Mathieson

As our largest stockholder, sole officer and director, Mr. Mathieson will have the right to make all decisions with respect to our management. Mr. Mathieson can exercise sole authority over the direction of IEG Holdings,Mr. Amazing Loans, and any future reverse stock splits that could result in stockholders being involuntarily cashed out.

Investment Company Act of 1940

If we were deemed to be an investment company under the Investment Company Act of 1940, Act,as amended (the “1940 Act”), applicable restrictions could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business. Under Sections 3(a)(1)(A) and (C) of the 1940 Act, an issuer of securities will generally fit the definition of an “investment company” for purposes of the 1940 Act if (i) it is, or holds itself out as being, engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities or (ii) is engaged or proposes to engage in the business of issuing face-amount installment certificates or has any of this type of certificate outstanding. In addition, issuers who do not otherwise fit the definition of an investment company are sometimes deemed to be investment companies, under Section 3(a)(1)(C) of the 1940 Act, if the value of their investment securities exceeds 40% of their total assets.

Although an issuer may fall within the definition of an “investment company” under Section 3(a)(1)(C) of the 1940 Act, the issuer may qualify for an exemption from the definition. Rule 3a-1 under the 1940 Act provides an exemption from the definition of investment company if, on a consolidated basis with its wholly owned subsidiaries, nor more than 45% of its net income after taxes for the last four quarters is derived from securities other than government securities and securities of majority owned subsidiaries and companies primarily controlled by it. As of December 31, 2018 and 2017, we calculated both our percentage of investment security assets (securities other than government securities, employee companies and certain subsidiaries and affiliates) to total assets and our total percentage of investment income (income from investment securities) as compared to total income to be below the Rule 3a-1 45% thresholds.

We were able to maintain our compliance with the 1940 Act because we regularly monitor our status under the 1940 Act and conduct prudential analyses in accordance with the 1940 Act and the SEC’s interpretations thereof. We conduct such analyses on a consolidated basis with our wholly owned subsidiaries to determine whether the thresholds set out in Rule 3a-1 are exceeded. As a result, we do not believe that we should be regulated as an “investment company,” as such term is defined in the 1940 Act, and we intend to conduct our operations to maintain this status. However, if we were to be deemed an investment company, restrictions imposed by the 1940 Act, including limitations on our capital structure and our ability to transact with affiliates, could have a material adverse effect on our business.

Market

We operate in the consumer finance industry serving the growing population of consumers who have limited access to credit from banks, credit card companies and other lenders. According to the Federal Deposit Insurance Corporation, 7.7% (1 in 13) of households in the United States were unbanked in 2013. This proportion represented nearly 9.6 million households. According to the Center for Financial Services December 2015 report, the rapid rise of short-term credit, which grew 37% from 2012 to 2014, while single payment credit grew only 0.1% over the same period, is starkly apparent. With anticipated regulatory changes likely to alter the feasibility of offering loans due in one lump sum, many companies are investing more heavily in installment-based credit products, while new players are seeking to upend the economics of small-dollar loans through online channels and alternative underwriting. The strong marketing and new account approval rates of subprime credit cards have also provided consumers with increased access to funds available on a short-term basis. Together, these shifts in the consumer lending industry suggest that total revenue for short-term credit products, estimated at $29 billion in 2014, may outpace that of single payment credit products, estimated at $38 billion for the same year. Short-term credit products generate nearly twice as much annual revenue as single payment credit products.

Installment lending to non-prime consumers is one of the most highly fragmented sectors of the consumer finance industry. We are a state-licensed Internet-based personal loan company serving in the consumer installment lending industry. Our online lending platform provides the distribution network to efficiently address this growing market of consumers without the significant costs and overhead associated with an extensive branch network. We believe we are well positioned to capitalize on the significant growth and expansion opportunity created by the continued shift of consumers to online services, such as online banking and in our case online personal loans.

We are currently licensed and/or hold certificates of authority to provide loans online to residents of Alabama, Arizona, California, Florida, Georgia, Illinois, Kentucky, Louisiana, Maryland, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon, Pennsylvania, Texas, Utah Virginia and Wisconsin, with plans to continue to expand across the United States by acquiring additional state lending licenses.Virginia. The following is a breakdown of our cumulative loan origination amounts in each licensed state for our current active loan portfolio as at December 31, 2017:2018:

Business Strategy

Our business strategy is to lower the cost of providing consumer loans by leveraging our online lending platform and distribution network to enable further loan book growth and portfolio diversification. Our strategy includes a number of key elements:

On December 22, 2017, we announced that we had formed a wholly owned subsidiary to explore the legalities and economic risks and benefits of entering into a joint venture with IEC to accept repayment of customer loans in the form of existing crypto/blockchain currencies, provide the crypto equivalent of $5,000 and $10,000 loans to customers, and also potentially create and issue an IEC cryptocurrency. The company did not begin operations and was in the development planning stages. On March 14, 2018, we announced that, after considering the potential risks and benefits, we will not pursue a cryptocurrency offering or any other cryptocurrency-related ventures at this time. We will continue to monitor the developing regulatory landscape surrounding this new technology and may consider cryptocurrency opportunities in the future. In addition, we will continue to explore the potential application of blockchain technology to our core consumer lending business.

Competitive Strengths

We believe our competitive strengths are:

Products

We currently provide $5,000 and $10,000 online consumer loans unsecured over a five-year term with rates ranging from 12.0% to 29.9% annual percentage rate. Our current loan portfolio also includes loans remaining from our previous product offerings which were $2,000 to $10,000 loans unsecured over a three-three to five-year term at 12.0% to 29.9%.

Our personal loan products are fully amortizing, fixed rate, unsecured installment loans and all loans are offered at prevailing statutory rates, with our standard loan product being a 29.9% interest rate and annual percentage rate, fully amortizing, five-year unsecured personal loan. The variations from this standard loan product in certain states is due to individual state requirements and to comply with our state lending licenses; for example, Florida requires a blended rate which caps the maximum rate on a $5,000 loan at 24%.licenses.

The following is a breakdown of loan terms and interest rates for each currently licensed state:

The following is an illustrative profile of our personal loans:

We commenced originating personal loans online in July 2013. Prior to that, we provided loans to customers via our office network, which comprised one office in each state as required by state licensing regulations. Our online loan origination platform now means that a qualifying customer can obtain a loan from us without having to come into an office location. We have maintained our full underwriting processes, identity verifications and fraud checks to ensure that online customers are verified to the same degree that customers were when they obtained a loan in an office. We expect our website and application portal,www.mramazingloans.com, to be a key driver of customer conversions and loan book growth.

The following graphs depict our monthly loan origination values from January 2013 through December 20172018 and our yearly revenue for 2013 through 2017:2018:

The following table sets forth the minimum, maximum and average credit score, income and age of our current borrowers as of December 31, 2017:2018:

Average Borrower Demographic of Current Loan Portfolio as at December 31, 20172018

Customer Acquisition

Since launching online lending in July 2013, our marketing efforts have been focused on online customer acquisition. We saw increases in loan applications and inquiries as a result of search engine advertising and commenced banner advertising, remarketing and search engine optimization in 2014. We commenced online video advertising in 2015. We have also engaged numerous online lead generators who provide personal loan leads on a daily basis with a combination of cost per funded loan and cost per application expense. We are continuing to develop relationships with additional lead generation partners to drive further growth. We also supplement our online marketing efforts with traditional direct mail advertising.

Additional Information Regarding Our Loan Portfolio

This section provides additional quantitative information and qualitative discussion related to our loan portfolio and related credit metrics and trends including key loan and credit metrics.

Loans Receivable Roll-Forward

The table below documents the activity in the loan receivable accounts for the period indicated. Specifically, it shows a roll-forward of our loans receivable balance, detail of new loan originations, principal reductions from cash collections and loan charge-offs. The data encompasses changes during each quarter of 2018 and also changes during the full year 2018 compared to 2017.

New loan volume slowed in 2018 compared to 2017 due to Company capital constraints and reduced advertising. However, the increased level of principal reductions from cash collections and loan charge-offs resulted in a reduction in the loans receivable balance to $4,663,363 as at December 31, 2018 compared to $6,160,881 at December 31, 2017.

The table below documents the activity in the loan receivable accounts for the period indicated. Specifically, it shows a roll-forward of our loans receivable balance, detail of new loan originations, principal reductions from cash collections and loan charge-offs. The data encompasses changes during each quarter of 2017 and also changes during the full year 2017 compared to 2016.

New loan volume slowed in the first half of 2017 due to Company capital constraints and reduced advertising. New loan volume increased in the second half of 2017 due to increased available Company capital and increased advertising. However, the increased level of principal reductions from cash collections and once-off Virginia loan principal reductions due to legal settlements resulted in a reduction in the loans receivable balance to $6,160,881 as at December 31, 2017 compared to $7,587,349 at December 31, 2016.

Portfolio Yield

The following table below documentsshows, as of December 31, 2018, the activityaggregate loan principal outstanding and the average portfolio yield by state. In addition, to show indicative duration of the portfolio yield, the table shows the average loan amount, average current principal outstanding and the average years to maturity of the loans in each state.

(1) Maryland was added as a licensed state in October 2016.

(2) Ohio was added as a licensed state in December 2016.

We undertook an advertising strategy during 2018 that focused on refinancing customers in the loan receivable accounts for the periods indicated. Specifically, it shows a roll-forwardstates with an average yield of 29.9% only to maximize our loans receivable balance, detail of new loan originations, principal reductions from cash collections and loan charge-offs.portfolio yield while we were capital constrained. The data encompasses changes during each quarter of 2016 and also changes during the full year 2016 compared to 2015.

New loan volume slowedadvertising strategy resulted in the second half of 2016 due to Company capital constraints and reduced advertising. The level of principal reductions from cash collections, combined with reduced new 2016 loan volumes (compared to 2015) and an increase in loan charge-offs, resultedthe average portfolio yield in a reduction in the loans receivable balance to $7,587,349 as at December 31, 20162018 compared to $8,110,077 at December 31, 2015.

Portfolio Yield2017.

The following table shows, as of December 31, 2017, the aggregate loan principal outstanding and the average portfolio yield by state. In addition, to show indicative duration of the portfolio yield, the table shows the average loan amount, average current principal outstanding and the average years to maturity of the loans in each state.

(1) Maryland was added as a licensed state in October 2016.

(2) Ohio was added as a licensed state in December 2016.

(3) Wisconsin was added as a licensed state in June 2017.

We undertook an advertising strategy during the first half of 2017 that focused on refinancing customers in the states with an average yield of 29.9% only to maximize our portfolio yield while we were capital constrained. In the third and fourth quarters of 2017 we focused on providing new loans to customers in the states with an average yield of 29.9% to maximize our portfolio yield. The advertising strategy resulted in an increase in the average portfolio yield in 2017 compared to 2016.

The following table shows, as of December 31, 2016, the aggregate loan principal outstanding and the average portfolio yield by state. In addition, to show indicative duration of the portfolio yield, the table shows the average loan amount, average current principal outstanding and the average years to maturity of the loans in each state.

(1) Maryland was added as a licensed state in October 2016.

(2) Ohio was added as a licensed state in December 2016.

(3) Wisconsin was added as a licensed state in June 2017.

We undertook an advertising strategy during 2016 that focused on seeking new customers in the states with an average yield of 29.9% only to maximize our portfolio yield while we were capital constrained. The advertising strategy resulted in an increase in the average portfolio yield in 2016 compared to 2015.

Customer Acquisition Costs

Since launching online lending in 2013, our marketing efforts have been focused on online customer acquisition. We experienced increases in loan applications and inquiries as a result of search engine advertising and commenced banner advertising, remarketing and search engine optimization in 2014. We commenced online video advertising in 2015. We have also engaged numerous online lead generators who provide personal loan leads on a daily basis with a combination of cost per funded loan and cost per application expense. We are continuing to develop relationships with additional lead generation partners to drive further growth. We also supplement our online marketing efforts with traditional direct mail advertising.

The following table shows the level of advertising cost versus the level of loan volume in 20162017 and 20172018 as both a dollar amount and as a percentage of loan volume for the relevant year. The advertising cost represents both general advertising/brand awareness costs as well as direct fees paid to lead generators and direct mail costs. Although it potentially overstates the direct cost of customer acquisition in a particular year it provides a guide to the general cost and trends in customer acquisition costs. In addition, the customer cost of acquisition is upfront, whereas the revenue from the customer is typically realized 5 years later and for repeat customers, even later.

In 20172018 there was a substantial increasereduction in advertising expenses as a percentage of new loans funded in the year asdue to a significant direct mail campaignfocus on refinancing existing customers rather than targeting new customers was conducted with more competition from competitors for new loans. However, enhancements have been made to the Company’s internal underwriting procedures and process in early 2018 that management believe should result in a reduction in the cost of customer acquisition in 2018 to substantially less than 2017 levels.customers.

Gross Charge-off Ratio and Recovery Ratio

The credit quality of our loans is driven by our underwriting criteria, which takes into account income, money management, credit history, employment history and willingness and capacity to repay the proposed loan. The profitability of our loan portfolio is directly connected to net credit losses; therefore, we closely analyze credit performance. We also monitor recovery rates because of their contribution to the reduction in the severity of our charge-offs. Additionally, because delinquencies are an early indicator of future net credit losses, we analyze delinquency trends, adjusting for seasonality, to determine whether or not our loans are performing in line with our original estimates. Because loan volume and portfolio size determine the magnitude of the impact of each of the above factors on our earnings, we also closely monitor origination volume and annual percentage rate.

The table below sets forth information regarding the gross charge-off ratio and the recovery ratio in both dollar amounts and in terms of a ratio versus outstanding loans receivable balance. The data is presented for each quarter in 20162017 and 2017,2018, for each of the full years for 20162017 and 2017.2018.

We saw a slight increasedecrease in charge-off ratio in 20172018 versus 20162017 as we saw an increasinga decreasing trend in customer hardship and moreless customers utilizing external debt management services. We significantly increased our level of loss recoveries in both dollar amount and percentage of loans receivable balance due to more internal resources being allocated to the task,appointment of an external debt collection agency in July 2018, combined with a larger pool of losses to recover funds from.

Delinquency Ratio

The tables below set forth, for the period indicated, information concerning the delinquency ratio measured in buckets of days delinquent in both dollar amounts and also as a percentage of total principal.

At December 31, 2018, we had 41 loans delinquent or in default (defined as 91+ days past due), representing 4.65% of the number of loans in our active portfolio. Loans become eligible for the lender to take legal action at 60 days past due. At December 31, 2018, our delinquency percentage rate for past due loans was 8.98% (31+ days) with an allowance for loan loss at 20.00%.

At December 31, 2017, we had 86 loans delinquent or in default (defined as 91+ days past due), representing 5.32% of the number of loans in our active portfolio. Loans become eligible for the lender to take legal action at 60 days past due. At December 31, 2017, our delinquency percentage rate for past due loans was 9.26% (31+ days) with an allowance for loan loss at 20.00%.

At December 31, 2016, we had 83 loans delinquent or in default (defined as 91+ days past due), representing 4.84% of the number of loans in our active portfolio. Loans become eligible for the lender to take legal action at 60 days past due. At December 31, 2016, our delinquency percentage rate for past due loans was 10.39% (31+ days) with an allowance for loan loss at 16.00%. There was an increase in the delinquency ratio from December 31, 2015 to December 31, 2016 due to an increasing trend in customer hardship, combined with a fall in loans receivables principal outstanding.

Allowance for Credit Losses Ratio

Management exercises its judgment, based on quantitative analyses, qualitative factors, such as recent delinquency and other credit trends, and experience in the consumer finance industry, when determining the amount of the allowance for loan receivable losses. We adjust the amounts for management’s estimate of the effects of events and conditions such as changes to underwriting criteria, portfolio seasoning, and current economic conditions, including levels of unemployment, and personal bankruptcies.

The allowance for credit losses ratio (reserve level) was increased from 16% for 2016 tosteady at 20% for 2017.2017 and 20% for 2018. The net loan balance decreased from $6,374,908 at December 31, 2016 to $4,928,704 at December 31, 2017.2017 to $3,174,574 at December 31, 2018. The net loan balance at the current reserve level of 20% is $4,928,704$3,174,574 at December 31, 2017.2018.

There was no change in lending policies and procedures, including changes in underwriting standards and collection, charge-off, and recovery practices not considered elsewhere in estimating credit losses in the twelve months of 20172018 compared to the year ended December 31, 2016.2017 other than the appointment of an external debt collection agency in July 2018. There were no material changes in international, national, regional, and local economic and business conditions and developments in the twelve months of 20172018 compared to the year ended December 31, 20162017 that affected the collectability of the portfolio, including the condition of various market segments other than increased customer hardship. During 20172018 there was no significant change in the nature of the loan portfolio and was a decrease in the average size of the loan portfolio. There were no changes in the experience, ability, and depth of lending management and other relevant staff in the twelve months ended December 31, 2017.2018 other than the termination of the Chief Operating Officer in September 2018. There was a decrease in the volume and severity of past due loans and the volume of non-accrual loans due to a smaller loan portfolio for the twelve months ended December 31, 2017,2018, as compared to the year ended December 31, 2016.2017. No changes were made to the quality of our loan review system in the twelve months ended December 2017.2018. There was no significant effect of other external factors such as competition and legal and regulatory requirements on the level of estimated credit losses in our loan portfolio in the twelve months ended December 31, 2017.2018.

Contractual Loan Maturity

The following table shows, as of December 31, 2018, the aggregate principal amount of loans by maturity date.

The following table shows, as of December 31, 2017, the aggregate principal amount of loans by maturity date.

The following table shows, as of December 31, 2016, the aggregate principal amount of loans by maturity date.