UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

Amendment No. 1

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

For the fiscal year ended December 31, 2023

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

For the transition period from ________ to ________

Commission File Number: 001-37945

FLEXSHOPPER, INC.

(Exact name of Registrant as specified in its charter)

Delaware		20-5456087
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

901 Yamato Road, Ste. 260
Boca Raton, FL		33431
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (855) 353-9289

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.0001 per share		FPAY		The NASDAQ Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: None

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

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

Indicate by check mark whether the registrant (1) has 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. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an 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:

Large accelerated filer:	☐	Accelerated filer:	☐
Non-accelerated filer:	☒	Smaller reporting company:	☒
		Emerging growth company:	☐

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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant, as of the last business day of the Registrant’s most recently completed second fiscal quarter, was approximately $16,272,000 (based on the price at which the Registrant’s common stock was last sold on June 30, 2023 of $1.28 per share).

The number of shares outstanding of the Registrant’s common stock, as of April 3, 2024, was 21,752,304.

Documents incorporated by reference: None

Auditor Name: Grant Thornton LLP

Auditor Location: Fort Lauderdale, Florida

Auditor Firm ID: 248

Explanatory Note

This Amendment No. 1 on Form 10-K/A amends the FlexShopper, Inc. (“FlexShopper” or the “Company”) Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as filed with the Securities and Exchange Commission (“SEC”) on April 1, 2024 (the “Original Filing”). We are filing this Amendment No. 1 to correct the basic and diluted weighted average common shares and the basic and diluted loss per common shares as of December 31, 2023 in the Consolidated Statements of Operations and in Note 2 to the Consolidated Financial Statement, as those numbers were reported inaccurately in the Original Filing. As required by Rule 12b-15 under the Securities Exchange Act of 1934, new certifications of our principal executive officer and principal financial officer are being filed as exhibits to this Amendment No. 1 on Form 10-K/A.

Except as described above, no other changes have been made to the Original Filing. The Original Filing continues to speak as of the date of the Original Filing, and we have not updated the disclosures contained therein to reflect any events which occurred at a date subsequent to the filing of the Original Filing. Accordingly, this Amendment No. 1 should be read in conjunction with our filings with the SEC subsequent to the date of the Original Filing.

Table of Contents

		Page

PART II

Item 8.	Financial Statements and Supplementary Data	F-1

PART IV

Item 15.	Exhibits and Financial Statement Schedules	1

SIGNATURES		2

PART II

Item 8. Financial Statements and Supplementary Data

FLEXSHOPPER, INC.

CONTENTS

YEARS ENDED DECEMBER 31, 2023 AND 2022		PAGE
FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm (PCAOB ID 248)		F-2
Consolidated Balance Sheets		F-4
Consolidated Statements of Operations		F-5
Consolidated Statements of Stockholders’ Equity		F-6
Consolidated Statements of Cash Flows		F-7
Notes to Consolidated Financial Statements		F-8

F-1

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders of

FlexShopper, Inc.

Opinion on the financial statements

We have audited the accompanying consolidated balance sheets of FlexShopper, Inc. and subsidiaries (the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years then ended and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical audit matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Allowance for Doubtful Accounts on Lease Receivables

As described further in Note 2 to the consolidated financial statements, the Company records an allowance on lease receivables with a corresponding reduction to lease revenue and fees. The Company determines the amount of allowance to recognize based upon historical and current customer collections as a portion of its gross customer billings.

The principal consideration for our determination that the allowance on lease receivables is a critical audit matter is the high degree of subjectivity that is involved in evaluating the reasonableness of management’s estimate, including collection rate assumptions used in the allowance model that derive the expected future customer payments.

Our audit procedures related to the allowance for doubtful accounts on lease receivables included the following, among others:

●	We obtained an understanding of management’s process and evaluated the design of controls related to the allowance model, including controls over the completeness and accuracy of information used in the model and management review controls over the model.

●	We assessed the reasonableness of the methodology used by management to determine the allowance.

●	We sampled leases and tested the underlying data including the lease amount, lease aging, and completeness and accuracy of the application of lease payments during 2023.

●	We recomputed historical collection rates and the allowance for the year ended December 31, 2023.

F-2

Loan Receivables at Fair Value

As described further in Note 2 to the consolidated financial statements, the Company records its loan receivables at fair value on a recurring basis with changes in fair value recognized as a component of loan revenues and fees. The Company determines the fair value of loan receivables using a discounted cash flow model based on the estimated amount and timing of expected future cash flows.

The principal consideration for our determination that the fair value measurement of loan receivables is a critical audit matter is the high degree of subjectivity that is involved in evaluating the reasonableness of management’s estimate, including the discount rate, prepayment rate, default rate and loss severity assumptions.

Our audit procedures related to the fair value measurement of loan receivables included the following, among others:

●	We obtained an understanding of management’s process and evaluated the design of controls related to the loan receivables valuation model, including controls over the completeness and accuracy of information used in the model and management review controls over the model.

●	We confirmed loan balances with the third-party loan servicer.

●	We sampled loans and tested the underlying data.

●	With the assistance of an internal specialist, we independently determined the fair value measurement of loan receivables as of December 31, 2023 and compared it to management’s fair value measurement for reasonableness.

Income Taxes

As discussed in Note 2 and Note 10 to the consolidated financial statements, the Company records a valuation allowance to reduce the deferred tax asset when a judgment is made, that is considered more likely than not, that a tax benefit will not be realized. The ultimate realization of the deferred tax asset is dependent upon the generation of future taxable income during the periods in which those temporary differences will become deductible. The Company assesses the need for a valuation allowance by evaluating both positive and negative evidence that exists. We identified the realizability of the federal deferred tax asset to be a critical audit matter.

The principal consideration for our determination that the realizability of the deferred tax asset is a critical audit matter is that the forecast of future taxable income is an accounting estimate subject to a high level of estimation. There is inherent uncertainty and subjectivity related to management’s judgments and assumptions regarding the Company’s future financial performance which is complex in nature and requires significant auditor judgment.

Our audit procedures related to the realizability of the federal deferred tax asset included the following, among others:

●	We obtained an understanding of management’s process and evaluated the design of controls related to the realizability of the federal deferred tax asset.

●

With the assistance of an internal specialist, we reviewed the valuation models for reasonableness and tested the assessment of the realizability of the federal deferred tax asset, including testing the calculations related to the potential limitation of tax attributes, and testing the schedule of reversing temporary differences.

/s/ GRANT THORNTON LLP

We have served as the Company’s auditor since 2022.

Fort Lauderdale, FL

April 1, 2024

F-3

FLEXSHOPPER, INC.

CONSOLIDATED BALANCE SHEETS

	December 31,			December 31,
	2023			2022

ASSETS
CURRENT ASSETS:
Cash	$	4,413,130		$	6,051,713
Restricted cash		-			121,636
Lease receivables, net		44,795,090			35,540,043
Loan receivables at fair value		35,794,290			32,932,504
Prepaid expenses and other assets		3,300,677			3,489,136
Lease merchandise, net		29,131,440			31,550,441
Total current assets		117,434,627			109,685,473

Property and equipment, net		9,308,859			8,086,862
Right of use asset, net		1,237,010			1,406,270
Intangible assets, net		13,391,305			15,162,349
Other assets, net		2,175,215			1,934,728
Deferred tax asset, net		12,943,361			12,013,828
Total assets	$	156,490,377		$	148,289,510

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	7,139,848		$	6,511,943
Accrued payroll and related taxes		578,197			310,820
Promissory notes to related parties, including accrued interest		198,624			1,209,455
Accrued expenses		3,972,397			3,988,093
Lease liability - current portion		245,052			208,001
Total current liabilities		12,134,118			12,228,312
Loan payable under credit agreement to beneficial shareholder, net of unamortized issuance costs of $70,780 at December 31,2023 and $352,252 at December 31,2022		96,384,220			80,847,748
Promissory notes to related parties, net of unamortized issuance costs of $649,953 at December 31, 2023 and $0 at December 31, 2022, and net of current portion		10,100,047			10,750,000
Promissory note related to acquisition, net of discount of $1,165,027 at December 31, 2022		-			3,158,471
Loan payable under Basepoint credit agreement, net of unamortized issuance costs of $92,963 at December 31, 2023		7,319,641			-
Purchase consideration payable related to acquisition		-			8,703,684
Lease liabilities, net of current portion		1,321,578			1,566,622
Total liabilities		127,259,604			117,254,837

STOCKHOLDERS’ EQUITY
Series 1 Convertible Preferred Stock, $0.001 par value - authorized 250,000 shares, issued and outstanding 170,332 shares at $5.00 stated value		851,660			851,660
Series 2 Convertible Preferred Stock, $0.001 par value - authorized 25,000 shares, issued and outstanding 21,952 shares at $1,000 stated value		21,952,000			21,952,000
Common stock, $0.0001 par value- authorized 40,000,000 shares, issued and outstanding 21,752,304 shares at December 31, 2023 and 21,750,804 shares at December 31, 2022		2,176			2,176
Treasury shares, at cost- 164,029 shares at 2023		(166,757	)		-
Additional paid in capital		42,415,894			39,819,420
Accumulated deficit		(35,824,200	)		(31,590,583	)
Total stockholders’ equity		29,230,773			31,034,673
	$	156,490,377		$	148,289,510

The accompanying notes to consolidated financial statements are an integral part of these statements.

F-4

FLEXSHOPPER, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

	For the years ended December 31,
	2023			2022

Revenues:
Lease revenues and fees, net	$	91,943,729		$	105,936,072
Loan revenues and fees, net of changes in fair value		25,031,278			7,120,101
Total revenues		116,975,007			113,056,173

Costs and expenses:
Depreciation and impairment of lease merchandise		56,288,128			72,556,431
Loan origination costs and fees		6,007,598			3,384,013
Marketing		7,620,795			11,031,695
Salaries and benefits		12,499,099			10,991,477
Operating expenses		24,547,729			21,395,767
Net change in fair value of promissory note related to acquisition		(3,678,689	)		-
Total costs and expenses		103,284,660			119,359,383

Operating income/ (loss)		13,690,347			(6,303,210	)

Gain on bargain purchase		-			14,461,274
Interest expense including amortization of debt issuance costs		(18,913,773	)		(11,161,396	)
Loss before income taxes		(5,223,426	)		(3,003,332	)
Benefit from income taxes		989,809			16,635,051
Net (loss)/ income		(4,233,617	)		13,631,719

Dividends on Series 2 Convertible Preferred Shares		4,103,638			3,730,580
Net (loss)/ income attributable to common and Series 1 Convertible Preferred shareholders	$	(8,337,255	)	$	9,901,139

Basic and diluted (loss)/ income per common share:
Basic	$	(0.38	)	$	0.45
Diluted	$	(0.38	)	$	0.44

WEIGHTED AVERAGE COMMON SHARES:
Basic		21,705,406			21,646,896
Diluted		21,705,406			22,425,354

The accompanying notes to consolidated financial statements are an integral part of these statements.

F-5

FLEXSHOPPER, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For the years ended December 31, 2023 and 2022

	Series 1 Convertible Preferred Stock				Series 2 Convertible Preferred Stock				Common Stock				Treasury Stock					Additional Paid in		Accumulated
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount			Capital		Deficit			Total
Balance, January 1, 2022		170,332	$	851,660		21,952	$	21,952,000		21,442,278	$	2,144		-	$	-		$	38,560,117	$	(45,222,302	)	$	16,143,619
Provision for compensation expense related to stock-based compensation		-		-		-		-		-		-		-		-			997,830		-			997,830
Exercise of stock options into common stock		-		-		-		-		308,526		32		-		-			261,473		-			261,505
Net income		-		-		-		-		-		-		-		-			-		13,631,719			13,631,719
Balance, December 31, 2022		170,332	$	851,660		21,952	$	21,952,000		21,750,804	$	2,176		-	$	-		$	39,819,420	$	(31,590,583	)	$	31,034,673
Provision for compensation expense related to stock-based compensation		-		-		-		-		-		-		-		-			1,677,708		-			1,677,708
Exercise of stock options into common stock		-		-		-		-		1,500		-		-		-			1,185		-			1,185
Extension of warrants		-		-		-		-		-		-		-		-			917,581		-			917,581
Purchases of treasury stock		-		-		-		-		-		-		164,029		(166,757	)		-		-			(166,757	)
Net loss		-		-		-		-		-		-		-		-			-		(4,233,617	)		(4,233,617	)
Balance, December 31, 2023		170,332	$	851,660		21,952	$	21,952,000		21,752,304	$	2,176		164,029	$	(166,757	)	$	42,415,894	$	(35,824,200	)	$	29,230,773

The accompanying notes are an integral part of these condensed consolidated statements.

F-6

FLEXSHOPPER, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the years ended December 31, 2023 and 2022

	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss)/ income	$	(4,233,617	)	$	13,631,719
Adjustments to reconcile net (loss)/ income to net cash used in operating activities:
Depreciation and impairment of lease merchandise		56,288,128			72,556,431
Other depreciation and amortization		7,881,110			4,769,614
Amortization of debt issuance costs		571,538			228,843
Amortization of discount on the promissory note related to acquisition		236,952			19,747
Compensation expense related to stock-based compensation		1,677,708			997,830
Provision for doubtful accounts		42,505,647			57,420,480
Interest in kind added to promissory notes balance		-			155,093
Deferred income tax		(929,533	)		(17,282,364	)
Net change in fair value of promissory note related to acquisiton		(3,678,689	)		-
Gain on bargain purchase		-			(14,461,274	)
Net changes in the fair value of loan receivables at fair value		(10,217,854	)		9,559,979
Changes in operating assets and liabilities, net of effects of acquisition:
Lease receivables		(51,760,694	)		(67,487,369	)
Loan receivables at fair value		7,356,068			(25,612,049	)
Prepaid expenses and other assets		177,169			(1,670,836	)
Lease merchandise		(53,869,127	)		(63,164,760	)
Purchase consideration payable related to acquisition		208,921			164,102
Promissory note related to acquisition		283,266			-
Lease liabilities		(30,268	)		(14,488	)
Accounts payable		627,905			(1,976,844	)
Accrued payroll and related taxes		267,377			(80,258	)
Accrued expenses		(26,527	)		1,009,468
Net cash used in operating activities		(6,664,520	)		(31,236,936	)

CASH FLOWS FROM INVESTING ACTIVITIES
Cash acquired in business combination		-			2,938,355
Purchases of property and equipment, including capitalized software costs		(6,335,276	)		(6,498,115	)
Purchases of data costs		(1,225,983	)		(1,640,885	)
Net cash used in investing activities		(7,561,259	)		(5,200,645	)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from loan payable under credit agreement		18,050,000			36,455,000
Repayment of loan payable under credit agreement		(2,795,000	)		(5,730,000	)
Repayment of loan payable under Basepoint credit agreement		(1,500,000	)		-
Repayment of promissory notes to related parties		(1,000,000	)		-
Debt issuance related costs		(115,403	)		(166,745	)
Proceeds from exercise of stock options		1,185			261,505
Proceeds from promissory notes to related parties		-			7,000,000
Principal payment under finance lease obligation		(8,465	)		(11,184	)
Repayment of purchase consideration payable related to acquisition		-			(283,266	)
Repayment of installment loan		-			(9,022	)
Purchases of Treasury Stock		(166,757	)		-
Net cash provided by financing activities		12,465,560			37,516,288

(DECREASE)/ INCREASE IN CASH and RESTRICTED CASH		(1,760,219	)		1,078,707

CASH and RESTRICTED CASH, beginning of period		6,173,349			5,094,642

CASH and RESTRICTED CASH, end of period	$	4,413,130		$	6,173,349

Supplemental cash flow information:
Interest paid	$	17,337,292		$

SEC Form 10-K/A filed by FlexShopper Inc. (Amendment)