Annual report pursuant to Section 13 and 15(d)

Assets and Liabilities Transferred to Trust Mortgage - 350 Green

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Assets and Liabilities Transferred to Trust Mortgage - 350 Green
 12 Months Ended
Dec. 31, 2016
Business Combinations [Abstract]  
Assets and Liabilities Transferred to Trust Mortgage - 350 Green

5. ASSETS AND LIABILITIES TRANSFERRED TO TRUST MORTGAGE – 350 GREEN

 

SUMMARY

 

On April 17, 2014, the Company’s Board of Directors executed a resolution to form a trust mortgage relating to 350 Green. On May 29, 2014, the Company and EVSE Management LLC (“EVSE”) entered into a Management Services Agreement and on June 27, 2014, EVSE purchased certain assets from 350 Green for total consideration of $860,836 which included a note receivable from Car Charging in the amount of $314,598. On September 8, 2014, the Company entered into an agreement among the trustee of 350 Green, an attorney, 350 Green and the Company whereby the Company would pay the legal fees incurred in connection with an action brought by 350 Green against JNS Power and Control Systems, Inc. (“JNS”). On September 30, 2014, the Company (“Assignor”) entered into an Assignment Agreement with Green 350 Trust Mortgage LLC (“Assignee”), an entity formed by the trustee for the sole purpose to entering into this transaction, under which Assignor, the sole member of 350 Green, irrevocably assigned, sold and transferred 100% of the limited liability company membership interests in 350 Green to Assignee and Assignee accepted such transfer for nominal consideration of $100.

 

Through April 16, 2014, 350 Green was a wholly-owned subsidiary of the Company in which the Company had full control and was consolidated. Beginning on April 17, 2014, 350 Green was deemed to be a VIE and, therefore, we continued to consolidate 350 Green. On July 8, 2015, the Company and the trustee of 350 Green agreed to settle the note receivable in the amount of $314,598 for $25,000 in full satisfaction of the note. On September 9, 2015, the United States Court of Appeals for the Seventh Circuit of Chicago, Illinois affirmed the ruling of the United States District Court for the Northern District of Illinois in the matter of JNS Power & Control Systems, Inc. v. 350 Green, LLC in favor of JNS. See Note 17 – Commitments and Contingencies – Litigation and Disputes for additional details.

 

The following amounts pertaining to 350 Green are included in the consolidated statements of operations for the year ended December 31, 2015:

 

    For the Years Ended
December 31, 2015 		 
       
Revenues   $ -  
         
Cost of Revenues     (209,086 )
         
Gross Profit     209,086  
         
Operating Expenses:        
Other operating expenses     -  
General and administrative expenses     25,114  
Loss on sale/replacement of EV charging stations     -  
Total Operating Expenses     25,114  
         
Income From Operations     183,972  
         
Other Income (Expense):        
Interest income     6,352  
Gain on settlement of accounts payable     155,770  
Gain on settlement of debt     314,598  
Loss on settlement of note receivable     (271,092 )
         
Total Other Income, net     205,628  
         
Net Income   $ 389,600  

 

The following current liabilities pertaining to 350 Green are included in the consolidated balance sheets:

 

    December 31,  
    2016     2015  
             
Accounts payable   $ 3,728,193     $ 3,908,009  
Accrued expenses     5,969       5,969  
Total   $ 3,734,162     $ 3,913,978  

 

The following represents the change in the balance of the non-controlling interest:

 

    For the Years Ended December 31,  
    2016     2015  
Beginning balance   $ (4,011,130 )   $ (4,400,730 )
Net income of 350 Green     -       389,600  
Assumption of liability of 350 Green by Car Charging Group, Inc.     179,816       -  
Ending balance   $ (3,831,314 )   $ (4,011,130 )

 

On June 29, 2015, 350 Green recorded a $155,770 gain on the settlement of fees payable to a network operator that originated prior to 2015.