Subsequent Events	12 Months Ended
Dec. 31, 2012
Subsequent Events
Subsequent Events	16. Subsequent Events On February 12, 2013, the Company entered into a number of agreements as outlined below: The PESI Settlement On February 12, 2013, the Company entered into the PESI Settlement Agreement, which memorializes the parties’ settlement of certain disputes that had arisen under that certain Stock Purchase Agreement dated as of July 15, 2011 (the “SEC Purchase Agreement”), pursuant to which the Company sold to PESI the capital stock of SEC. As reported in the Company’s Current Reports on Form 8-K filed with the Securities and Exchange Commission on July 19, 2011 and November 3, 2011, as part of the purchase price for the capital stock of SEC (the “SEC Purchase Price”), PESI issued to the Company that certain Non-Negotiable Promissory Note dated October 31, 2011 in the original principal amount of $2,500,000 (the “Original PESI Note”) and deposited into escrow an amount equal to $2,000,000 pursuant to that certain Escrow Agreement, dated as of October 31, 2011 (the “PESI Escrow Agreement”), by and among the Company, PESI and SunTrust Bank, as escrow agent. Pursuant to the PESI Settlement Agreement, among other things, as full and final settlement of all disputes between the parties relating to the Purchase Agreement, (i) the Company and PESI directed SunTrust Bank, as escrow agent under the PESI Escrow Agreement, to release to TNC the balance of the funds being held in escrow in the approximate amount of $500,000 (the “PESI Escrow Funds”) and (ii) the Company forgave $1,229,773.75 of the debt outstanding under the Original PESI Note and replaced the Original PESI Note with the New PESI Note. The parties also released each other from any and all other claims, whether known or unknown, with respect to the Purchase Agreement. The New PESI Note has the same terms as the Original PESI Note, except that the principal amount of $1,459,547.50, including interest, outstanding under the Original PESI Note has been reduced to $229,773.75, and it is no longer secured by the PESI Escrow Funds. The Leichtweis Settlement On February 12, 2013, the Company entered into the Leichtweis Settlement Agreement, with Leichtweis and certain former investors in the Company signatory thereto (the “Management Investors”). Under the terms of that agreement, the Company, Leichtweis and the Management Investors, among other things, terminated all of their respective rights and obligations under that certain Exchange Agreement, dated as of October 31, 2011 (the “Leichtweis Agreement”), by and among, the Company (f/k/a Homeland Security Capital Corporation), Leichtweis, as representative of the Management Investors and the Management Investors signatory thereto, and released each other from certain obligations set forth therein. Under the terms of the Leichtweis Agreement, Leichtweis and the Management Investors canceled their shares of the Company’s Series I Preferred Stock and certain warrants to purchase shares of the Company’s common stock in exchange for a portion of the SEC Purchase Price. The Debt Restructuring On February 12, 2013, the Company entered into the Restructuring Agreement, pursuant to which the Company and YA restructured the Company’s indebtedness pursuant to the August Note in the original principal amount of $2,311,050 dated August 28, 2012. The August Note prohibits the Company from, among other things, amending, modifying or otherwise altering the PESI Note, the PESI Escrow Agreement and/or the Leichtweis Agreement. Under the terms of the Restructuring Agreement, YA (i) consented to the Company entering into the PESI Settlement Agreement and Leichtweis Settlement Agreement, (ii) consented to replacing the Existing PESI Note with the New PESI Note, including, without limitation, the proposed debt forgiveness, and (iii) forgave approximately $975,000 of the debt outstanding under the August Note. In addition, YA agreed to amend and restate the August Note into the (i) Second Amended and Restated Promissory Note in the original principal amount of $250,000, which is recourse but unsecured, and (ii) the Second Amended and Restated Non-Recourse Promissory Note in the original principal amount of $550,000, which is in substantially the same form as the August Note, except that the principal amount has been reduced and it is no longer secured by the PESI Escrow Funds. As a result of the restructuring of the Company’s indebtedness, the Company and YA also entered into the Amendment to the Security Agreements, pursuant to which the Collateral (as defined, and more fully described, in the Amended and Restated Security Agreements dated August 28, 2012) that secures the Company’s obligations under the Second Amended and Restated Non-Recourse Note is limited generally to all right, title and interest of the Company under the New PESI Note and of CSS under that certain Escrow Agreement, dated August 19, 2011, by and among CSS (f/k/a Corporate Security Solutions, Inc.), Halifax Security, Inc. and CSC Trust Company of Delaware, and all supporting obligations, proceeds and products of any of the foregoing, including any insurance, wherever located, whether now owned, or now due, in which the Company and/or CSS has/have an interest or the power to transfer rights, or hereafter acquired, arising, or to become due, or in which the Company and/or CSS obtains/obtain an interest, or the power to transfer rights. The practical effect of the PESI Settlement is to reduce the balance owed to the Company under the Original PESI Note from $1,459,548 to $229,774 or a reduction of $1,229,774, release of $500,000 of the escrow funds to the Company and to eliminate all future claims concerning the July 15, 2011 sale of SEC to PESI. The practical effect of the Leichtweis Settlement is to reduce the amount the Company owed to the Management Investors, as described above, from $61,484 to $6,758 or a reduction of $54,726. The practical effect of the Debt Restructuring is to reduce the amount the Company owed to YA under the August Note from $2,311,050 to $800,000 or $1,511,050, by payment of $500,000 and debt forgiveness by YA as discussed above. The Company followed the guidelines established by the Financial Accounting Standards Board (FASB) Codification 855-10-25-1 and AU-C 560.07 and recognized, in its December 31, 2012 financial statements and footnotes included in this Annual Report on Form 10K, the effects of the above subsequent events because these events represent the culmination of conditions that existed as of the balance sheet date. On January 31, 2013, the Company’s Timios, Inc. subsidiary entered into a three year capital lease for computer equipment and supplies in the approximate amount of $329,208, including interest. The lease provides a bargain buyout at the end of the term. The lease payments will be $101,280 in 2013, $115,749 in 2014 and $112,179 in 2015. On January 31, 2013, the Company’s Timios, Inc. subsidiary paid $224,215 in full satisfaction of the contingent consideration agreed to in the purchase agreement of Timios. On March 5, 2013, YA converted 24,656 shares of Series J Preferred into 81,073 shares of our Common Stock. On March 12, 2013, the Company received $300,000 from its escrow receivable originally established in support of representations and warranties for the sale of CSS. On March 14, 2013, the Company remitted the $300,000 to YA as per the agreement in the Second Amended and Restated Non-Recourse Promissory Note.

16. Subsequent Events

On February 12, 2013, the Company entered into a number of agreements as outlined below:

The PESI Settlement

On February 12, 2013, the Company entered into the PESI Settlement Agreement, which memorializes the parties’ settlement of certain disputes that had arisen under that certain Stock Purchase Agreement dated as of July 15, 2011 (the “SEC Purchase Agreement”), pursuant to which the Company sold to PESI the capital stock of SEC. As reported in the Company’s Current Reports on Form 8-K filed with the Securities and Exchange Commission on July 19, 2011 and November 3, 2011, as part of the purchase price for the capital stock of SEC (the “SEC Purchase Price”), PESI issued to the Company that certain Non-Negotiable Promissory Note dated October 31, 2011 in the original principal amount of $2,500,000 (the “Original PESI Note”) and deposited into escrow an amount equal to $2,000,000 pursuant to that certain Escrow Agreement, dated as of October 31, 2011 (the “PESI Escrow Agreement”), by and among the Company, PESI and SunTrust Bank, as escrow agent.

Pursuant to the PESI Settlement Agreement, among other things, as full and final settlement of all disputes between the parties relating to the Purchase Agreement, (i) the Company and PESI directed SunTrust Bank, as escrow agent under the PESI Escrow Agreement, to release to TNC the balance of the funds being held in escrow in the approximate amount of $500,000 (the “PESI Escrow Funds”) and (ii) the Company forgave $1,229,773.75 of the debt outstanding under the Original PESI Note and replaced the Original PESI Note with the New PESI Note. The parties also released each other from any and all other claims, whether known or unknown, with respect to the Purchase Agreement.

The New PESI Note has the same terms as the Original PESI Note, except that the principal amount of $1,459,547.50, including interest, outstanding under the Original PESI Note has been reduced to $229,773.75, and it is no longer secured by the PESI Escrow Funds.

The Leichtweis Settlement

On February 12, 2013, the Company entered into the Leichtweis Settlement Agreement, with Leichtweis and certain former investors in the Company signatory thereto (the “Management Investors”). Under the terms of that agreement, the Company, Leichtweis and the Management Investors, among other things, terminated all of their respective rights and obligations under that certain Exchange Agreement, dated as of October 31, 2011 (the “Leichtweis Agreement”), by and among, the Company (f/k/a Homeland Security Capital Corporation), Leichtweis, as representative of the Management Investors and the Management Investors signatory thereto, and released each other from certain obligations set forth therein. Under the terms of the Leichtweis Agreement, Leichtweis and the Management Investors canceled their shares of the Company’s Series I Preferred Stock and certain warrants to purchase shares of the Company’s common stock in exchange for a portion of the SEC Purchase Price.

The Debt Restructuring

On February 12, 2013, the Company entered into the Restructuring Agreement, pursuant to which the Company and YA restructured the Company’s indebtedness pursuant to the August Note in the original principal amount of $2,311,050 dated August 28, 2012. The August Note prohibits the Company from, among other things, amending, modifying or otherwise altering the PESI Note, the PESI Escrow Agreement and/or the Leichtweis Agreement.

Under the terms of the Restructuring Agreement, YA (i) consented to the Company entering into the PESI Settlement Agreement and Leichtweis Settlement Agreement, (ii) consented to replacing the Existing PESI Note with the New PESI Note, including, without limitation, the proposed debt forgiveness, and (iii) forgave approximately $975,000 of the debt outstanding under the August Note. In addition, YA agreed to amend and restate the August Note into the (i) Second Amended and Restated Promissory Note in the original principal amount of $250,000, which is recourse but unsecured, and (ii) the Second Amended and Restated Non-Recourse Promissory Note in the original principal amount of $550,000, which is in substantially the same form as the August Note, except that the principal amount has been reduced and it is no longer secured by the PESI Escrow Funds. As a result of the restructuring of the Company’s indebtedness, the Company and YA also entered into the Amendment to the Security Agreements, pursuant to which the Collateral (as defined, and more fully described, in the Amended and Restated Security Agreements dated August 28, 2012) that secures the Company’s obligations under the Second Amended and Restated Non-Recourse Note is limited generally to all right, title and interest of the Company under the New PESI Note and of CSS under that certain Escrow Agreement, dated August 19, 2011, by and among CSS (f/k/a Corporate Security Solutions, Inc.), Halifax Security, Inc. and CSC Trust Company of Delaware, and all supporting obligations, proceeds and products of any of the foregoing, including any insurance, wherever located, whether now owned, or now due, in which the Company and/or CSS has/have an interest or the power to transfer rights, or hereafter acquired, arising, or to become due, or in which the Company and/or CSS obtains/obtain an interest, or the power to transfer rights.

The practical effect of the PESI Settlement is to reduce the balance owed to the Company under the Original PESI Note from $1,459,548 to $229,774 or a reduction of $1,229,774, release of $500,000 of the escrow funds to the Company and to eliminate all future claims concerning the July 15, 2011 sale of SEC to PESI. The practical effect of the Leichtweis Settlement is to reduce the amount the Company owed to the Management Investors, as described above, from $61,484 to $6,758 or a reduction of $54,726. The practical effect of the Debt Restructuring is to reduce the amount the Company owed to YA under the August Note from $2,311,050 to $800,000 or $1,511,050, by payment of $500,000 and debt forgiveness by YA as discussed above.

The Company followed the guidelines established by the Financial Accounting Standards Board (FASB) Codification 855-10-25-1 and AU-C 560.07 and recognized, in its December 31, 2012 financial statements and footnotes included in this Annual Report on Form 10K, the effects of the above subsequent events because these events represent the culmination of conditions that existed as of the balance sheet date.

On January 31, 2013, the Company’s Timios, Inc. subsidiary entered into a three year capital lease for computer equipment and supplies in the approximate amount of $329,208, including interest. The lease provides a bargain buyout at the end of the term. The lease payments will be $101,280 in 2013, $115,749 in 2014 and $112,179 in 2015.

On January 31, 2013, the Company’s Timios, Inc. subsidiary paid $224,215 in full satisfaction of the contingent consideration agreed to in the purchase agreement of Timios.

On March 5, 2013, YA converted 24,656 shares of Series J Preferred into 81,073 shares of our Common Stock.

On March 12, 2013, the Company received $300,000 from its escrow receivable originally established in support of representations and warranties for the sale of CSS. On March 14, 2013, the Company remitted the $300,000 to YA as per the agreement in the Second Amended and Restated Non-Recourse Promissory Note.