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☑
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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001-33105
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86-0879433
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(State or Other Jurisdiction
of Incorporation or Organization
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(Commission
File Number)
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(I.R.S. Employer
Identification No.)
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Large accelerated filer ☐
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Accelerated filer ☒
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Non-accelerated filer ☐ (Do not check if a smaller reporting company)
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Smaller reporting company ☐
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Emerging growth company ☐
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for comply with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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☐
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•
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Build Great Products to Acquire, Engage, and Thrill Users:
Our core focus is to create innovative social experiences using sophisticated data science that help our users meet new people in their local communities and throughout the world. We plan on continuing to invest in improving our core platform as technology advances and in devising new ways of engineering serendipity online. A key area of product focus in 2018 is the delivery, engagement and monetization of our live streaming video.
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•
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Offer Innovative and Engaging Ad Products for Marketers:
We consider it critical to continue improving our advertising products to create more value for our marketers, attract new customers, and display targeted advertisements that are more relevant for our users. We pursue these goals through a combination of internal innovation and rapid integration of advertising solutions that have been successful in the marketplace.
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•
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Integrating our Recent Acquisitions to Drive Growth:
Following our acquisitions of if(we) and Lovoo in 2017, we are focused on effectively integrating both companies, realizing synergies, and driving growth across our platform.
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Monthly Average for the Quarter Ended
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|||||||
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December 31,
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|||||||
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2017
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2016
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2015
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|||
MAU
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16,695,097
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8,915,575
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4,971,638
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For the Quarter Ended
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|||||||
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December 31,
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|||||||
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2017
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2016
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2015
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DAU
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4,953,317
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2,084,987
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1,189,290
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(1)
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Tables above include active users from Skout, if(we) and Lovoo as of the acquisition dates of October 3, 2016, April 3, 2017 and October 19, 2017.
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(1)
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Tables above include active users from Skout, if(we) and Lovoo as of the acquisition dates of October 3, 2016, April 3, 2017 and October 19, 2017.
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•
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Mobile applications and websites whose primary focus is to help users meet new people in their geographical area, including Badoo, Twoo and Meetup.
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•
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Social networking mobile applications and websites with a focus on dating, which is a subset of the opportunity around meeting new people, such as Zoosk, Match, Happn, PlentyOfFish, OkCupid and Tinder.
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•
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Other video platforms that provide one-to-many and one-to-one video services such as live.me, live.ly, musical.ly, Azar, Younow and Periscope.
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•
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Broader social networks that currently offer or may evolve to offer services aimed at helping users meet new people in their area, such as Facebook, Twitter and LinkedIn.
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•
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Significant competition for Social Theater comes from publishers including TrueX, Unruly Media, SuperSonic Advertising, Jun Group and Genesis Media.
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•
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attract new users and retain existing users at a consistent rate;
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•
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increase engagement by existing users;
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•
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monetize our user base;
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•
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anticipate changes in the social networking and social discovery industry;
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•
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launch new products and release enhancements that become popular;
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•
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develop and maintain a scalable, high-performance technology infrastructure that can efficiently and reliably handle increased member usage, fast load times and the deployment of new features and applications;
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•
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process, store and use data in compliance with governmental regulation and other legal obligations related to privacy;
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•
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compete with other companies that are currently in, or may in the future enter, the social networking or social discovery industry;
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•
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hire, integrate and retain world class talent; and
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•
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expand our business internationally and with respect to mobile devices.
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•
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introduce new and improved products that are favorably received;
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•
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identify and respond to emerging technological trends in the market;
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•
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provide a compelling user experience with the decisions we make with respect to the frequency, prominence, and size of advertising and other commercial content we display;
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•
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continue to develop features, such as our Live feature, for mobile devices that users find engaging, that work with a variety of mobile operating systems and networks, and that achieve a high level of market acceptance;
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•
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acquire or license leading technologies;
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•
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avoid technical or other problems that prevent us from delivering our services in a rapid and reliable manner or otherwise affect the user experience; or
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•
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provide adequate customer service to users or advertisers.
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•
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decreases in user engagement, including time spent on our mobile applications;
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•
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product changes or inventory management decisions we may make that reduce the size, frequency, or relative prominence of advertising and other commercial content that we display;
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•
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our inability to increase the rate at which our users “click through” on the ads we display;
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•
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our inability to improve our analytics and measurement solutions that demonstrate the value of our advertising and other commercial content;
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•
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loss of advertising market share to our competitors;
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•
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adverse legal developments relating to advertising, including legislative and regulatory developments and developments in litigation;
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•
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adverse media reports or other negative publicity involving us or other companies in our industry;
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•
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objections to the content of our apps and websites;
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•
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changes in the way online advertising is priced;
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•
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changes in the digital advertising market, including the introduction of standard metrics;
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•
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the impact of new technologies that could block or obscure the display of our advertising and other commercial content; and
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•
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the impact of macroeconomic conditions and conditions in the advertising industry, and, in particular, the digital advertising industry, in general.
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•
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Competitiveness of Our Products. We must deliver ads in an effective manner and provide accurate analytics and measurement solutions that demonstrate the value of our advertising products compared to those of our competitors. Similarly, if the pricing of our advertising products does not compare favorably to those of our competitors, advertisers may reduce their advertising with us or choose not to advertise with us at all.
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•
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Traffic Quality. The success of our advertising program depends on delivering positive results to our advertising customers. Low-quality or invalid traffic, such as robots, spiders and the mechanical automation of clicking, may be detrimental to our relationships with advertisers and could adversely affect our advertising pricing and revenue. If we fail to detect and prevent click fraud or other invalid clicks on ads, the affected advertisers may experience or perceive a reduced return on their investments, which could lead to dissatisfaction with our products, refusals to pay, refund demands or withdrawal of future business.
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•
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Perception of Our Platform. Our ability to compete effectively for advertiser budgets depends on our reputation and perceptions regarding our platform.
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Macroeconomic Conditions. Adverse macroeconomic conditions can have a negative impact on the demand for advertising, particularly with respect to online advertising products. Advertisers may have limited advertising budgets and may view online advertising as lower priority than offline advertising.
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•
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the usefulness, ease of use, performance, and reliability of our services compared to our competitors;
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•
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the size and composition of our user base;
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•
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the engagement of our users with our services;
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the timing and market acceptance of services, including developments and enhancements to our or our competitors’ services;
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•
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our ability to monetize our services;
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•
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the frequency, size, and relative prominence of the advertising and other commercial content displayed by us or our competitors;
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customer service and support efforts;
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marketing and selling efforts;
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changes mandated by legislation, regulatory authorities, or litigation, including settlements and consent decrees, some of which may have a disproportionate effect on us;
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•
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acquisitions or consolidation within our industry, which may result in more formidable competitors;
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our ability to attract, retain, and motivate talented employees, particularly software engineers;
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our ability to cost-effectively manage and grow our operations; and
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our reputation and brand strength relative to our competitors.
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rapidly changing technology;
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evolving industry standards and practices that could render our platform and proprietary technology obsolete;
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•
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changes in consumer tastes and demands; and
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•
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frequent introductions of new services or products that embody new technologies.
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•
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political, social, or economic instability;
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risks related to the legal and regulatory environment in foreign jurisdictions, including with respect to privacy, and changes in laws, regulatory requirements, and enforcement;
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burdens of complying with a variety of foreign laws;
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potential damage to our brands and reputation due to our compliance with local laws, including potential censorship or requirements to provide user information to local authorities, and/or potential penalties for failing to comply with such local laws;
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•
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lack of familiarity with local customs;
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•
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fluctuations in currency exchange rates;
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higher levels of credit risk and payment fraud;
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reduced protection for intellectual property rights in some countries; and
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•
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difficulties in staffing and managing global operations and the increased travel, infrastructure.
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•
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Facebook discontinues or limits access to its platform by us and other application developers;
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•
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Facebook modifies its terms of service or other policies, including changing how the personal information of its users is made available to application developers on the Facebook platform or shared by users;
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•
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Facebook develops its own competitive offerings; or
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•
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Facebook disallows our advertising in its platforms.
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•
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changes in the number of our daily and monthly active users;
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•
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changes in visits by our active users;
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•
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independent reports relating to the metrics of our mobile applications or website;
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•
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our failure to generate increases in revenue;
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•
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our failure to meet the challenges of monetizing our users;
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•
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our failure to achieve or maintain profitability;
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•
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actual or anticipated variations in our quarterly results of operations;
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•
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announcements by us or our competitors of significant contracts, new services, or acquisitions;
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•
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commercial relationships, joint ventures, or capital commitments;
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•
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the loss of significant business relationships;
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•
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changes in market valuations of social media companies;
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the loss of major advertisers;
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•
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future acquisitions or combinations;
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•
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the departure of key personnel;
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short selling activities; or
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regulatory developments.
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•
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require repayment of any outstanding lease obligations;
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terminate our leasing arrangements;
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stop delivery of ordered equipment;
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•
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sell or require us to return our leased equipment; or
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•
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require us to pay significant damages.
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•
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our inability to successfully evaluate and utilize the Acquired Companies’ products, technology or personnel;
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•
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disruption to the Acquired Companies’ businesses and operations and relationships with service providers, advertisers, employees and other partners;
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•
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negative effects on our products and product pipeline from the changes and potential disruption that may follow the Acquisitions;
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•
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diversion of our management’s attention from other strategic activities;
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•
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our inability to successfully combine the businesses in a manner that permits the combined company to achieve the cost savings anticipated to result from the Acquisitions;
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•
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diversion of significant resources from the ongoing development of our existing operations; and
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•
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greater than anticipated costs related to the integration of the Acquired Companies’ businesses and operations into ours.
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•
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if we are unable to successfully integrate the benefit plans, duties and responsibilities, and other factors of interest to the management and employees of the Acquired Companies, we could lose employees to our competitors, which could significantly affect our ability to operate the business and complete the integration;
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•
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if we are unable to implement and retain uniform standards, controls, policies, procedures and information system; and
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•
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if the integration process causes any delays with the delivery of our services, or the quality of those services, we could lose users and ultimately advertisers, which would reduce our revenues and earnings.
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•
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expenses related to the acquisition process and impairment charges to goodwill and other intangible assets related to the Acquisitions;
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•
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the dilutive effect on earnings per share as a result of issuances of stock and incurring operating losses;
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•
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stock volatility due to investors' uncertainty regarding the values of the Acquired Companies;
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•
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diversion of capital from other uses;
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•
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failure to achieve the anticipated benefits of the Acquisitions in a timely manner, or at all; and
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•
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adverse outcome of litigation matters or other contingent liabilities assumed in or arising out of the Acquisitions.
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For the Year Ended December 31, 2017
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High
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|
Low
|
||||
First quarter
|
$
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6.20
|
|
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$
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4.51
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Second quarter
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$
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6.45
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$
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4.50
|
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Third quarter
|
$
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5.45
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$
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3.41
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Fourth quarter
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$
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3.82
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$
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2.19
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For the Year Ended December 31, 2016
|
|
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|
||||
First quarter
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$
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4.54
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$
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2.57
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Second quarter
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$
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5.57
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|
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$
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2.71
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Third quarter
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$
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8.11
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$
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4.68
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Fourth quarter
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$
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6.19
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$
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4.51
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For the Years Ended December 31,
|
||||||||||||||||||
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2017
(1)
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2016
(1)
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2015
|
|
2014
|
|
2013
|
||||||||||
Statements of Operations Data:
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|
||||||||||
Revenues
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$
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123,753,813
|
|
|
$
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76,124,109
|
|
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$
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56,903,773
|
|
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$
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44,817,436
|
|
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$
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40,378,007
|
|
Operating costs and expenses
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180,764,422
|
|
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56,901,470
|
|
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48,909,207
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47,963,841
|
|
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50,437,810
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|
|||||
Income (loss) from operations
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(57,010,609
|
)
|
|
19,222,639
|
|
|
7,994,566
|
|
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(3,146,405
|
)
|
|
(10,059,803
|
)
|
|||||
Net (loss) income
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(64,591,727
|
)
|
|
46,268,618
|
|
|
5,969,628
|
|
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(3,962,165
|
)
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(10,898,325
|
)
|
|||||
Basic and diluted net (loss) income per
common stockholders:
|
|
|
|
|
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|
||||||||||
Basic net (loss) income per common
stockholders
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$
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(0.94
|
)
|
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$
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0.89
|
|
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$
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0.13
|
|
|
$
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(0.10
|
)
|
|
$
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(0.29
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)
|
Diluted net (loss) income per common
stockholders
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$
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(0.94
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)
|
|
$
|
0.80
|
|
|
$
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0.12
|
|
|
$
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(0.10
|
)
|
|
$
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(0.29
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)
|
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||||||||||
Balance Sheet Data:
|
|
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|
||||||||||
Working capital
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$
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8,015,160
|
|
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$
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32,678,157
|
|
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$
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29,213,696
|
|
|
$
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17,482,116
|
|
|
$
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6,932,875
|
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Total assets
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275,344,771
|
|
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209,489,484
|
|
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111,490,673
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|
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103,213,759
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|
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95,576,240
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|||||
Current portion of capital lease obligations
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254,399
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|
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221,302
|
|
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366,114
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|
|
872,761
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|
|
928,181
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|
|||||
Current portion of long-term debt
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15,000,000
|
|
|
—
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|
|
—
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|
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2,068,326
|
|
|
2,333,966
|
|
|||||
Long-term capital lease obligations
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192,137
|
|
|
—
|
|
|
221,302
|
|
|
587,416
|
|
|
713,699
|
|
|||||
Long term debt
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40,637,106
|
|
|
—
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|
|
—
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|
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556,612
|
|
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2,102,842
|
|
|||||
Total stockholders' equity
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185,540,560
|
|
|
195,088,589
|
|
|
102,670,362
|
|
|
92,256,967
|
|
|
81,808,050
|
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(1)
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See
Note 2—
Acquisitions
for further details on our Skout, if(we) and Lovoo Acquisitions.
|
•
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Liquidity;
|
•
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Capital expenditures;
|
•
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Opportunities for our business;
|
•
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Growth of our business; and
|
•
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Anticipations and expectations regarding mobile usage and monetization
|
•
|
Total revenue was
$123.8 million
for
2017
, up
62.6%
from
$76.1 million
in
2016
.
|
•
|
Net loss was
$64.6 million
for
2017
. Adjusted EBITDA was
$31.6 million
for
2017
. For definition of Adjusted EBITDA, please refer to the Non-GAAP – Financial Measures included below in this filing.
|
•
|
Cash and Cash Equivalents totaled
$24.2 million
at
December 31, 2017
, an increase of
$2.3 million
from
$21.9 million
at
December 31, 2016
.
|
•
|
Number of MAUs and DAUs:
We believe our ability to grow web and mobile MAUs and DAUs affects our revenue and financial results by influencing the number of advertisements we are able to show, the value of those advertisements, and the volume of subscriptions and in-app purchases, as well as our expenses and capital expenditures.
|
•
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User Engagement:
We believe changes in user engagement patterns affect our revenue and financial performance. Specifically, the number of visits and the amount of time spent by each MAU or DAU generates affects the number of advertisements we are able to display and therefore the rate at which we are able to monetize our active user base. In addition, the number of users that make in-app purchases and the amounts that they purchase directly impact our revenue. We continue to create new features and enhance existing features to drive additional engagement. The percent of MAU and DAU that engage with our video products and their conversion to paying users also affects the amount of in-app purchase revenue we are able to earn.
|
•
|
Advertising Rates:
We believe our revenue and financial results are materially dependent on industry trends, and any changes to the revenue we earn per thousand advertising impressions (CPM) could affect our revenue and financial results. In 2017 we experienced declining advertising rates, which negatively affected out revenue. We expect to continue investing in new types of advertising and new placements. Additionally, we are prioritizing initiatives that generate revenue directly from users, including new in-app purchases products and a premium subscription product, in part to reduce our dependency on advertising revenue.
|
•
|
User Geography:
The geography of our users influences our revenue and financial results because we currently monetize users in distinct geographies at varying average rates. For example, ARPU in the U.S. and Canada is significantly higher than in Latin America.
|
•
|
New User Sources:
The percentage of our new users that are acquired through inorganic, paid sources impacts our financial performance, specifically with regard to ARPU for web and mobile. Inorganically acquired users tend to have lower engagement rates, tend to generate fewer visits and ad impressions and to be less likely to make in-app purchases. When paid marketing campaigns are ongoing, our overall usage and traffic increases due to the influx of inorganically acquired users, but the rate at which we monetize the average active user overall declines as a result.
|
•
|
Ad Inventory Management:
Our revenue trends are affected by advertisement inventory management changes affecting the number, size, or prominence of advertisements we display. In general, more prominently displayed advertising units generate more revenue per impression. Our Social Theater campaign expenses are materially dependent on the percentage of Social Theater campaigns that run on MeetMe versus the percentage that run on other networks. We work to maximize the share of Social Theater campaigns that run on MeetMe and run campaigns on other networks only when necessary.
|
•
|
Google and iTunes App Store:
Our mobile applications are distributed through the Google Play Store and Apple App Our business will suffer if we are unable to maintain a good relationship with Google and Apple, if their terms and conditions or pricing change to our detriment, if we violate, or either company believes that we have violated, its terms and conditions, or if either of these platforms are unavailable for a prolonged period of time.
|
•
|
Increased Social Theater Competition:
A significant portion of the revenue generated by the Social Theater is derived from advertising campaigns, powered by Social Theater technology, that run on networks other than The Meet Group networks. A recent increase in competitors offering similar technology solutions, and in some cases their own cross-platform distribution networks, has made it more difficult to compete on price and win business. We expect this downward pressure on price to continue and impact our operating results in the future.
|
•
|
Seasonality:
Historically, advertising spending has traditionally been seasonal with a peak in the fourth quarter of each year. With the decline in advertising rates in 2017, we did not experience this seasonality consistent with prior years. We believe that this seasonality in advertising spending affects our quarterly results, which historically have reflected a growth in advertising revenue between the third and fourth quarters and a decline in advertising spending between the fourth and subsequent first and second quarters each year. Growth trends in web and mobile MAUs and DAUs affect our revenue and financial results by influencing the number of advertisements we are able to show, the value of those advertisements, the volume of payments transactions, as well as our expenses and capital expenditures.
|
•
|
Business Combinations:
Acquisitions have been an important part of our growth strategy. During the two years in the period ended December 31, 2017, we acquired three companies (Skout, if(we) and Lovoo) and four significant brands for our portfolio (Skout, Tagged, Hi5 and Lovoo). The ability to integrate these apps into our portfolio will impact our financial performance. As a consequence of the contributions of these businesses and acquisition-related expenses, our consolidated results of operations may not be comparable between periods.
|
|
Year Ended December 31,
|
|
Change From Prior Year
|
|||||||||||
|
2017
|
|
2016
|
|
($)
|
|
%
|
|||||||
Revenues
|
$
|
123,753,813
|
|
|
$
|
76,124,109
|
|
|
$
|
47,629,704
|
|
|
62.6
|
%
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
|||||||
Sales and marketing
|
20,355,964
|
|
|
15,089,987
|
|
|
5,265,977
|
|
|
34.9
|
%
|
|||
Product development and content
|
60,704,473
|
|
|
25,790,173
|
|
|
34,914,300
|
|
|
135.4
|
%
|
|||
General and administrative
|
19,549,805
|
|
|
9,494,804
|
|
|
10,055,001
|
|
|
105.9
|
%
|
|||
Depreciation and amortization
|
11,573,827
|
|
|
4,069,211
|
|
|
7,504,616
|
|
|
184.4
|
%
|
|||
Acquisition and restructuring
|
12,151,492
|
|
|
2,457,295
|
|
|
9,694,197
|
|
|
394.5
|
%
|
|||
Goodwill impairment
|
56,428,861
|
|
|
—
|
|
|
56,428,861
|
|
|
100.0
|
%
|
|||
Total operating costs and expenses
|
180,764,422
|
|
|
56,901,470
|
|
|
123,862,952
|
|
|
217.7
|
%
|
|||
(Loss) income from operations
|
(57,010,609
|
)
|
|
19,222,639
|
|
|
(76,233,248
|
)
|
|
(396.6
|
)%
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|||||||
Interest income
|
5,731
|
|
|
21,185
|
|
|
(15,454
|
)
|
|
(72.9
|
)%
|
|||
Interest expense
|
(860,392
|
)
|
|
(19,388
|
)
|
|
(841,004
|
)
|
|
(4,337.8
|
)%
|
|||
Change in warrant liability
|
—
|
|
|
(864,596
|
)
|
|
864,596
|
|
|
100.0
|
%
|
|||
(Loss) gain on foreign currency adjustment
|
(32,488
|
)
|
|
33,416
|
|
|
(65,904
|
)
|
|
(197.2
|
)%
|
|||
Other
|
9,631
|
|
|
—
|
|
|
9,631
|
|
|
100.0
|
%
|
|||
Total other expense
|
(877,518
|
)
|
|
(829,383
|
)
|
|
(48,135
|
)
|
|
(5.8
|
)%
|
|||
(Loss) income before income tax (expense) benefit
|
(57,888,127
|
)
|
|
18,393,256
|
|
|
(76,281,383
|
)
|
|
(414.7
|
)%
|
|||
Income tax (expense) benefit
|
(6,703,600
|
)
|
|
27,875,362
|
|
|
(34,578,962
|
)
|
|
(124.0
|
)%
|
|||
Net (loss) income
|
$
|
(64,591,727
|
)
|
|
$
|
46,268,618
|
|
|
$
|
(110,860,345
|
)
|
|
(239.6
|
)%
|
|
Year Ended December 31,
|
|
Change From Prior Year
|
|||||||||||
|
2016
|
|
2015
|
|
($)
|
|
%
|
|||||||
Revenues
|
$
|
76,124,109
|
|
|
$
|
56,903,773
|
|
|
$
|
19,220,336
|
|
|
33.8
|
%
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
|||||||
Sales and marketing
|
15,089,987
|
|
|
6,618,837
|
|
|
8,471,150
|
|
|
128.0
|
%
|
|||
Product development and content
|
25,790,173
|
|
|
24,615,304
|
|
|
1,174,869
|
|
|
4.8
|
%
|
|||
General and administrative
|
9,494,804
|
|
|
14,534,861
|
|
|
(5,040,057
|
)
|
|
(34.7
|
)%
|
|||
Depreciation and amortization
|
4,069,211
|
|
|
3,140,205
|
|
|
929,006
|
|
|
29.6
|
%
|
|||
Acquisition and restructuring
|
2,457,295
|
|
|
—
|
|
|
2,457,295
|
|
|
100.0
|
%
|
|||
Total operating costs and expenses
|
56,901,470
|
|
|
48,909,207
|
|
|
7,992,263
|
|
|
16.3
|
%
|
|||
Income from operations
|
19,222,639
|
|
|
7,994,566
|
|
|
11,228,073
|
|
|
140.4
|
%
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|||||||
Interest income
|
21,185
|
|
|
21,037
|
|
|
148
|
|
|
0.7
|
%
|
|||
Interest expense
|
(19,388
|
)
|
|
(459,962
|
)
|
|
440,574
|
|
|
95.8
|
%
|
|||
Change in warrant liability
|
(864,596
|
)
|
|
(616,607
|
)
|
|
(247,989
|
)
|
|
(40.2
|
)%
|
|||
(Loss) gain on foreign currency adjustment
|
33,416
|
|
|
—
|
|
|
33,416
|
|
|
100.0
|
%
|
|||
Loss on cumulative foreign currency translation adjustment
|
—
|
|
|
(856,438
|
)
|
|
856,438
|
|
|
100.0
|
%
|
|||
Gain on sale of asset
|
—
|
|
|
163,333
|
|
|
(163,333
|
)
|
|
(100.0
|
)%
|
|||
Total other expense
|
(829,383
|
)
|
|
(1,748,637
|
)
|
|
919,254
|
|
|
52.6
|
%
|
|||
Income before income tax benefit (expense)
|
18,393,256
|
|
|
6,245,929
|
|
|
12,147,327
|
|
|
194.5
|
%
|
|||
Income tax benefit (expense)
|
27,875,362
|
|
|
(276,301
|
)
|
|
28,151,663
|
|
|
(10,188.8
|
)%
|
|||
Net income
|
$
|
46,268,618
|
|
|
$
|
5,969,628
|
|
|
$
|
40,298,990
|
|
|
675.1
|
%
|
|
For the Years Ended December 31,
|
|
2017 to 2016
|
|
2016 to 2015
|
||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
Changes ($)
|
|
Changes ($)
|
||||||||||
Sales and marketing
|
$
|
439,797
|
|
|
$
|
354,088
|
|
|
$
|
309,708
|
|
|
$
|
85,709
|
|
|
$
|
44,380
|
|
Product development and content
|
4,008,545
|
|
|
1,528,547
|
|
|
1,197,696
|
|
|
2,479,998
|
|
|
330,851
|
|
|||||
General and administrative
|
4,018,936
|
|
|
1,685,352
|
|
|
1,409,023
|
|
|
2,333,584
|
|
|
276,329
|
|
|||||
Total stock-based compensation for vesting of options and RSA's
|
8,467,278
|
|
|
3,567,987
|
|
|
2,916,427
|
|
|
4,899,291
|
|
|
651,560
|
|
|||||
Warrant modification
|
—
|
|
|
—
|
|
|
425,538
|
|
|
—
|
|
|
(425,538
|
)
|
|||||
Total stock-based compensation expense
|
$
|
8,467,278
|
|
|
$
|
3,567,987
|
|
|
$
|
3,341,965
|
|
|
$
|
4,899,291
|
|
|
$
|
226,022
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Vesting of stock options
|
$
|
3,377,286
|
|
|
$
|
1,475,106
|
|
|
$
|
1,389,554
|
|
Vesting of restricted stock awards
|
5,089,992
|
|
|
2,092,881
|
|
|
1,526,873
|
|
|||
Warrant modification
|
—
|
|
|
—
|
|
|
425,538
|
|
|||
Total stock-based compensation expense
|
$
|
8,467,278
|
|
|
$
|
3,567,987
|
|
|
$
|
3,341,965
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Net cash provided by operating activities
|
$
|
31,270,666
|
|
|
$
|
25,922,895
|
|
|
$
|
7,209,245
|
|
Net cash used in investing activities
|
(128,003,910
|
)
|
|
(30,941,011
|
)
|
|
(1,514,964
|
)
|
|||
Net cash provided by (used in) financing activities
|
99,924,461
|
|
|
7,939,271
|
|
|
(3,298,640
|
)
|
|||
|
$
|
3,191,217
|
|
|
$
|
2,921,155
|
|
|
$
|
2,395,641
|
|
|
December 31, 2017
|
|
December 31, 2016
|
||||
Cash and cash equivalents
|
$
|
24,158,444
|
|
|
$
|
21,852,531
|
|
Total assets
|
$
|
275,344,771
|
|
|
$
|
209,489,484
|
|
Percentage of total assets
|
8.8
|
%
|
|
10.4
|
%
|
|
Balance at
Beginning of
Period
|
|
Additions,
Costs and
Expenses
|
|
Deductions,
Write-Offs
|
|
Balance at
End of the
Period
|
||||||||
Allowance for Doubtful Accounts:
|
|
|
|
|
|
|
|
||||||||
Year Ended December 31, 2017
|
$
|
283,000
|
|
|
$
|
304,306
|
|
|
$
|
59,348
|
|
|
$
|
527,958
|
|
Year Ended December 31, 2016
|
$
|
133,000
|
|
|
$
|
152,587
|
|
|
$
|
2,587
|
|
|
$
|
283,000
|
|
Year Ended December 31, 2015
|
$
|
586,000
|
|
|
$
|
181,398
|
|
|
$
|
634,398
|
|
|
$
|
133,000
|
|
•
|
Sales and Marketing:
Our sales and marketing expenses consist primarily of salaries, benefits, and non-cash share-based compensation for our employees engaged in sales, sales support, and marketing.
|
•
|
Product Development and Content:
Our product development and content expenses including costs incurred in the classification and organization of listings within our websites, including salaries, benefits, and non-cash share-based compensation for our employees, utility charges, occupancy and support for our offsite technology infrastructure, bandwidth and content delivery fees, and development and maintenance costs, are charged to expense as incurred.
|
•
|
General and Administrative:
Our general and administrative expenses consist primarily of salaries, benefits, and non-cash share-based compensation for our executives as well as our finance, legal, human resources, and other administrative employees. In addition, our general and administrative expenses include outside consulting, legal and accounting services, and facilities and other supporting overhead costs.
|
•
|
Depreciation and Amortization:
Our depreciation and amortization are non-cash expenses which have consisted primarily of depreciation and amortization related to our property and equipment, and intangible assets. Currently, the amortization expense is attributable to intangible assets associated with the acquisition of Skout, if(we) and Lovoo.
|
•
|
Acquisition and Restructuring Costs:
Acquisition costs include transactions costs including legal and diligence costs, accounting fees, employee retention bonuses in connection with the acquisitions and travel costs incurred by us during the acquisition process. Restructuring costs include costs incurred related to our business acquisitions, costs incurred in conjunction with the restructuring of our business processes, exit costs of non-cancellable leases, employee exit and relocation costs recorded as incurred.
|
•
|
Other Income (Expense):
Other income (expense) consists primarily of interest earned and interest expense. We have invested our cash in AAA rated, fully liquid money market accounts. Interest expense relates to our credit facilities as discussed in
Note 7—
Long-Term Debt
of the accompanying notes to the consolidated financial statements.
|
|
Total
|
|
Less Than 1
Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More than 5
Years
|
||||||||||
Capital leases
(1)
|
$
|
469,808
|
|
|
$
|
271,829
|
|
|
$
|
192,941
|
|
|
$
|
5,038
|
|
|
$
|
—
|
|
Operating leases
(2)
|
8,888,225
|
|
|
4,573,691
|
|
|
3,418,613
|
|
|
895,921
|
|
|
—
|
|
|||||
Cloud data storage
(3)
|
4,645,218
|
|
|
126,331
|
|
|
1,160,835
|
|
|
2,130,486
|
|
|
1,227,566
|
|
|||||
New Term Loan Facility
(4)
|
56,250,000
|
|
|
15,000,000
|
|
|
41,250,000
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
70,253,251
|
|
|
$
|
19,971,851
|
|
|
$
|
46,022,389
|
|
|
$
|
3,031,445
|
|
|
$
|
1,227,566
|
|
(1)
|
The capital lease obligations relate to equipment lease agreements for equipment primarily used in our data centers.
|
(2)
|
The operating lease obligations relate to equipment and facilities we lease in the U.S.
|
(3)
|
The cloud data storage costs relate to Google Cloud costs from our Lovoo application.
|
(4)
|
Interest rates on the New Term Loan Facility are variable in nature, however, we are party to a fixed-pay amortizing interest rate swap having a remaining notional amount of
$41.3 million
and a non-amortizing interest rate cap with a notional amount of
$15.0 million
. If interest rates were to remain at the
December 31, 2017
level, we would make interest payments of
$0.2 million
in less than 1 year and 1 - 3 years, respectively, of net settlements on the fixed-pay amortizing interest rate swap.
|
|
For the Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Net (loss) income
|
$
|
(64,591,727
|
)
|
|
$
|
46,268,618
|
|
|
$
|
5,969,628
|
|
Interest expense
|
860,392
|
|
|
19,388
|
|
|
459,962
|
|
|||
Change in warrant liability
|
—
|
|
|
864,596
|
|
|
616,607
|
|
|||
Income tax expense (benefit)
|
6,703,600
|
|
|
(27,875,362
|
)
|
|
276,301
|
|
|||
Depreciation and amortization
|
11,573,827
|
|
|
4,069,211
|
|
|
3,140,205
|
|
|||
Stock-based compensation expense
|
8,467,278
|
|
|
3,567,987
|
|
|
3,341,965
|
|
|||
Goodwill impairment
|
56,428,861
|
|
|
—
|
|
|
—
|
|
|||
Acquisition and restructuring
|
12,151,492
|
|
|
2,457,295
|
|
|
—
|
|
|||
Bad debt expense outside normal range
|
—
|
|
|
—
|
|
|
5,735,204
|
|
|||
Loss (gain) on foreign currency adjustment
|
32,488
|
|
|
(33,416
|
)
|
|
—
|
|
|||
Loss on cumulative foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
856,438
|
|
|||
Gain on sale of asset
|
—
|
|
|
—
|
|
|
(163,333
|
)
|
|||
Adjusted EBITDA
|
$
|
31,626,211
|
|
|
$
|
29,338,317
|
|
|
$
|
20,232,977
|
|
|
Page
|
|
|
Reports of Independent Registered Public Accounting Firm
|
|
|
|
Consolidated Balance Sheets as of December 31, 2017 and 2016
|
|
|
|
Consolidated Statements of Operations and Comprehensive (Loss) Income for the Years Ended December 31, 2017, 2016 and 2015
|
|
|
|
Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2017, 2016 and 2015
|
|
|
|
Consolidated Statements of Cash Flows for the Years Ended December 31, 2017, 2016 and 2015
|
|
|
|
Notes to Consolidated Financial Statements
|
|
2017
|
|
2016
|
||||
ASSETS
|
|
|
|
||||
CURRENT ASSETS:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
24,158,444
|
|
|
$
|
21,852,531
|
|
Accounts receivable, net of allowance of $527,958 and $283,000 at December 31, 2017 and 2016, respectively
|
26,443,675
|
|
|
23,737,254
|
|
||
Prepaid expenses and other current assets
|
3,245,174
|
|
|
1,489,267
|
|
||
Total current assets
|
53,847,293
|
|
|
47,079,052
|
|
||
Restricted cash
|
894,551
|
|
|
393,484
|
|
||
Goodwill
|
150,694,135
|
|
|
114,175,554
|
|
||
Property and equipment, net
|
4,524,118
|
|
|
2,466,110
|
|
||
Intangible assets, net
|
48,719,428
|
|
|
17,010,565
|
|
||
Deferred taxes
|
15,521,214
|
|
|
28,253,827
|
|
||
Other assets
|
1,144,032
|
|
|
110,892
|
|
||
Total assets
|
$
|
275,344,771
|
|
|
$
|
209,489,484
|
|
LIABILITIES AND STOCKHOLDERS
’
EQUITY
|
|
|
|
||||
CURRENT LIABILITIES:
|
|
|
|
||||
Accounts payable
|
$
|
6,277,846
|
|
|
$
|
5,350,336
|
|
Accrued liabilities
|
19,866,438
|
|
|
8,395,060
|
|
||
Current portion of long-term debt
|
15,000,000
|
|
|
—
|
|
||
Current portion of capital lease obligations
|
254,399
|
|
|
221,302
|
|
||
Deferred revenue
|
4,433,450
|
|
|
434,197
|
|
||
Total current liabilities
|
45,832,133
|
|
|
14,400,895
|
|
||
Long-term capital lease obligations, less current portion, net
|
192,137
|
|
|
—
|
|
||
Long-term debt
|
40,637,106
|
|
|
—
|
|
||
Long-term derivative liability
|
2,995,657
|
|
|
—
|
|
||
Other liabilities
|
147,178
|
|
|
—
|
|
||
Total liabilities
|
$
|
89,804,211
|
|
|
$
|
14,400,895
|
|
Commitments and Contingencies (see Note 8)
|
—
|
|
|
—
|
|
||
STOCKHOLDERS
’
EQUITY:
|
|
|
|
||||
Preferred stock, $.001 par value; authorized - 5,000,000 shares; 0 shares issued and outstanding at December 31, 2017 and 2016
|
$
|
—
|
|
|
$
|
—
|
|
Common stock, $.001 par value; authorized - 100,000,000 shares; 71,915,018 and 58,945,607 shares issued and outstanding at December 31, 2017 and 2016, respectively
|
71,918
|
|
|
58,949
|
|
||
Additional paid-in capital
|
408,029,068
|
|
|
351,873,801
|
|
||
Accumulated deficit
|
(221,435,888
|
)
|
|
(156,844,161
|
)
|
||
Accumulated other comprehensive loss
|
(1,124,538
|
)
|
|
—
|
|
||
Total stockholders
’
equity
|
185,540,560
|
|
|
195,088,589
|
|
||
Total liabilities and stockholders
’
equity
|
$
|
275,344,771
|
|
|
$
|
209,489,484
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Revenues
|
$
|
123,753,813
|
|
|
$
|
76,124,109
|
|
|
$
|
56,903,773
|
|
Operating costs and expenses:
|
|
|
|
|
|
||||||
Sales and marketing
|
20,355,964
|
|
|
15,089,987
|
|
|
6,618,837
|
|
|||
Product development and content
|
60,704,473
|
|
|
25,790,173
|
|
|
24,615,304
|
|
|||
General and administrative
|
19,549,805
|
|
|
9,494,804
|
|
|
14,534,861
|
|
|||
Depreciation and amortization
|
11,573,827
|
|
|
4,069,211
|
|
|
3,140,205
|
|
|||
Acquisition and restructuring
|
12,151,492
|
|
|
2,457,295
|
|
|
—
|
|
|||
Goodwill impairment
|
56,428,861
|
|
|
—
|
|
|
—
|
|
|||
Total operating costs and expenses
|
180,764,422
|
|
|
56,901,470
|
|
|
48,909,207
|
|
|||
(Loss) income from operations
|
(57,010,609
|
)
|
|
19,222,639
|
|
|
7,994,566
|
|
|||
Other income (expense):
|
|
|
|
|
|
||||||
Interest income
|
5,731
|
|
|
21,185
|
|
|
21,037
|
|
|||
Interest expense
|
(860,392
|
)
|
|
(19,388
|
)
|
|
(459,962
|
)
|
|||
Change in warrant liability
|
—
|
|
|
(864,596
|
)
|
|
(616,607
|
)
|
|||
(Loss) gain on foreign currency adjustment
|
(32,488
|
)
|
|
33,416
|
|
|
—
|
|
|||
Loss on cumulative foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
(856,438
|
)
|
|||
Gain on sale of asset
|
—
|
|
|
—
|
|
|
163,333
|
|
|||
Other
|
9,631
|
|
|
—
|
|
|
—
|
|
|||
Total other expense
|
(877,518
|
)
|
|
(829,383
|
)
|
|
(1,748,637
|
)
|
|||
(Loss) income before income tax (expense) benefit
|
(57,888,127
|
)
|
|
18,393,256
|
|
|
6,245,929
|
|
|||
Income tax (expense) benefit
|
(6,703,600
|
)
|
|
27,875,362
|
|
|
(276,301
|
)
|
|||
Net (loss) income
|
$
|
(64,591,727
|
)
|
|
$
|
46,268,618
|
|
|
$
|
5,969,628
|
|
|
|
|
|
|
|
||||||
Basic and diluted net (loss) income per common stockholders:
|
|
|
|
|
|
||||||
Basic net (loss) income per common stockholders
|
$
|
(0.94
|
)
|
|
$
|
0.89
|
|
|
$
|
0.13
|
|
Diluted net (loss) income per common stockholders
|
$
|
(0.94
|
)
|
|
$
|
0.80
|
|
|
$
|
0.12
|
|
|
|
|
|
|
|
||||||
Weighted average shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
68,743,956
|
|
|
51,963,702
|
|
|
45,419,175
|
|
|||
Diluted
|
68,743,956
|
|
|
57,745,652
|
|
|
49,535,826
|
|
|||
|
|
|
|
|
|
||||||
Other comprehensive (loss) income:
|
|
|
|
|
|
||||||
Net (loss) income
|
$
|
(64,591,727
|
)
|
|
$
|
46,268,618
|
|
|
$
|
5,969,628
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Reclassification of losses on derivative financial instruments, net of tax expense of $548,063
|
1,565,896
|
|
|
—
|
|
|
—
|
|
|||
Unrealized losses on derivative financial instruments, net of tax of benefit of $850,845
|
(2,302,415
|
)
|
|
—
|
|
|
—
|
|
|||
Foreign currency translation adjustment
|
(388,019
|
)
|
|
—
|
|
|
—
|
|
|||
Comprehensive (loss) income
|
$
|
(65,716,265
|
)
|
|
$
|
46,268,618
|
|
|
$
|
5,969,628
|
|
|
Preferred Stock
|
|
Common Stock
|
|
Additional
Paid-in
|
|
Accumulated
|
|
Accumulated
Other
Comprehensive
|
|
Total
Stockholders'
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Capital
|
|
Deficit
|
|
(Loss) Income
|
|
Equity
|
||||||||||||||
Balance— December 31, 2014
|
1,000,000
|
|
|
$
|
1,000
|
|
|
44,910,034
|
|
|
$
|
44,914
|
|
|
$
|
297,001,168
|
|
|
$
|
(204,072,240
|
)
|
|
$
|
(717,875
|
)
|
|
$
|
92,256,967
|
|
Vesting of stock options for compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,916,427
|
|
|
|
|
—
|
|
|
2,916,427
|
|
|||||||
Stock compensation expense for warrant modification
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
425,538
|
|
|
|
|
—
|
|
|
425,538
|
|
|||||||
Issuance of common stock for vested RSAs
|
—
|
|
|
—
|
|
|
557,603
|
|
|
557
|
|
|
(557
|
)
|
|
|
|
—
|
|
|
—
|
|
|||||||
Exercise of stock options
|
—
|
|
|
—
|
|
|
231,900
|
|
|
232
|
|
|
383,695
|
|
|
|
|
—
|
|
|
383,927
|
|
|||||||
Conversion of preferred stock to common stock
|
(1,000,000
|
)
|
|
(1,000
|
)
|
|
1,479,949
|
|
|
1,480
|
|
|
(480
|
)
|
|
|
|
—
|
|
|
—
|
|
|||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
(138,563
|
)
|
|
(138,563
|
)
|
|||||||
Loss on cumulative currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
856,438
|
|
|
856,438
|
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,969,628
|
|
|
—
|
|
|
5,969,628
|
|
||||||
Balance— December 31, 2015
|
—
|
|
|
—
|
|
|
47,179,486
|
|
|
47,183
|
|
|
300,725,791
|
|
|
(198,102,612
|
)
|
|
—
|
|
|
102,670,362
|
|
||||||
Vesting of stock options for compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,567,987
|
|
|
—
|
|
|
—
|
|
|
3,567,987
|
|
||||||
Exercise of stock options
|
—
|
|
|
—
|
|
|
4,693,918
|
|
|
4,694
|
|
|
8,841,370
|
|
|
—
|
|
|
—
|
|
|
8,846,064
|
|
||||||
Exercise of warrants
|
—
|
|
|
—
|
|
|
1,763,340
|
|
|
1,763
|
|
|
6,368,305
|
|
|
—
|
|
|
—
|
|
|
6,370,068
|
|
||||||
Issuance of common stock for Skout
acquisition |
—
|
|
|
—
|
|
|
5,222,017
|
|
|
5,222
|
|
|
32,371,283
|
|
|
—
|
|
|
—
|
|
|
32,376,505
|
|
||||||
Issuance of common stock for vested RSAs
|
—
|
|
|
—
|
|
|
934,991
|
|
|
935
|
|
|
(935
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchase and retirement of common stock
|
—
|
|
|
—
|
|
|
(848,145
|
)
|
|
(848
|
)
|
|
—
|
|
|
(5,010,167
|
)
|
|
—
|
|
|
(5,011,015
|
)
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,268,618
|
|
|
—
|
|
|
46,268,618
|
|
||||||
Balance— December 31, 2016
|
—
|
|
|
—
|
|
|
58,945,607
|
|
|
58,949
|
|
|
351,873,801
|
|
|
(156,844,161
|
)
|
|
—
|
|
|
195,088,589
|
|
||||||
Vesting of stock options for compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,467,278
|
|
|
—
|
|
|
—
|
|
|
8,467,278
|
|
||||||
Exercise of stock options
|
—
|
|
|
—
|
|
|
2,080,648
|
|
|
2,081
|
|
|
2,814,654
|
|
|
—
|
|
|
—
|
|
|
2,816,735
|
|
||||||
Exercise of warrants
|
—
|
|
|
—
|
|
|
675,000
|
|
|
675
|
|
|
2,395,575
|
|
|
—
|
|
|
—
|
|
|
2,396,250
|
|
||||||
Issuance of common stock
|
—
|
|
|
—
|
|
|
9,200,000
|
|
|
9,200
|
|
|
42,986,171
|
|
|
—
|
|
|
—
|
|
|
42,995,371
|
|
||||||
Issuance of common stock for vested RSAs
|
|
|
|
|
1,013,763
|
|
|
1,013
|
|
|
(1,013
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
RSAs withheld to cover taxes
|
|
|
|
|
—
|
|
|
—
|
|
|
(507,398
|
)
|
|
—
|
|
|
—
|
|
|
(507,398
|
)
|
||||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,124,538
|
)
|
|
(1,124,538
|
)
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(64,591,727
|
)
|
|
—
|
|
|
(64,591,727
|
)
|
||||||
Balance— December 31, 2017
|
—
|
|
|
$
|
—
|
|
|
71,915,018
|
|
|
$
|
71,918
|
|
|
$
|
408,029,068
|
|
|
$
|
(221,435,888
|
)
|
|
$
|
(1,124,538
|
)
|
|
$
|
185,540,560
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net (loss) income
|
$
|
(64,591,727
|
)
|
|
$
|
46,268,618
|
|
|
$
|
5,969,628
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
11,573,827
|
|
|
4,069,211
|
|
|
3,140,205
|
|
|||
Gain on sale of asset
|
—
|
|
|
—
|
|
|
(163,333
|
)
|
|||
Goodwill impairment
|
56,428,861
|
|
|
—
|
|
|
—
|
|
|||
Vesting of stock options for compensation
|
8,467,278
|
|
|
3,567,987
|
|
|
2,916,427
|
|
|||
Stock compensation expense for warrant modification
|
—
|
|
|
—
|
|
|
425,538
|
|
|||
Deferred taxes
|
6,927,513
|
|
|
(28,096,716
|
)
|
|
—
|
|
|||
Loss on cumulative foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
856,438
|
|
|||
Loss (gain) on cumulative foreign currency (translation)
|
2,413
|
|
|
(33,416
|
)
|
|
—
|
|
|||
Bad debt expense
|
262,848
|
|
|
150,000
|
|
|
(453,000
|
)
|
|||
Amortization of loan origination costs
|
192,825
|
|
|
—
|
|
|
184,868
|
|
|||
Revaluation of warrant liability
|
—
|
|
|
864,596
|
|
|
616,607
|
|
|||
Change in contingent consideration obligations
|
102,734
|
|
|
—
|
|
|
—
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
3,737,383
|
|
|
(3,231,037
|
)
|
|
(7,023,840
|
)
|
|||
Prepaid expenses, other current assets and other assets
|
4,734,521
|
|
|
(171,277
|
)
|
|
(19,967
|
)
|
|||
Accounts payable and accrued liabilities
|
1,880,304
|
|
|
2,583,211
|
|
|
684,745
|
|
|||
Deferred revenue
|
1,551,886
|
|
|
(48,282
|
)
|
|
74,929
|
|
|||
Net cash provided by operating activities
|
31,270,666
|
|
|
25,922,895
|
|
|
7,209,245
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Purchase of property and equipment
|
(1,798,051
|
)
|
|
(1,020,582
|
)
|
|
(1,769,964
|
)
|
|||
Acquisition of business, net of cash and restricted cash acquired
|
(126,205,859
|
)
|
|
(29,910,929
|
)
|
|
—
|
|
|||
Purchase of trademarks and domain names
|
—
|
|
|
(9,500
|
)
|
|
—
|
|
|||
Proceeds from sale of asset
|
—
|
|
|
—
|
|
|
255,000
|
|
|||
Net cash used in investing activities
|
(128,003,910
|
)
|
|
(30,941,011
|
)
|
|
(1,514,964
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from exercise of stock options
|
2,816,735
|
|
|
8,846,065
|
|
|
383,927
|
|
|||
Proceeds from issuance of common stock
|
42,995,371
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from exercise of warrants
|
2,396,250
|
|
|
4,470,335
|
|
|
—
|
|
|||
Purchases of treasury stock
|
—
|
|
|
(5,011,015
|
)
|
|
—
|
|
|||
Payments of capital leases
|
(323,512
|
)
|
|
(366,114
|
)
|
|
(872,761
|
)
|
|||
Proceeds from long-term debt
|
75,000,000
|
|
|
—
|
|
|
—
|
|
|||
Payments for restricted stock awards withheld for taxes
|
(507,398
|
)
|
|
—
|
|
|
—
|
|
|||
Loan origination costs
|
(805,719
|
)
|
|
—
|
|
|
—
|
|
|||
Payments of contingent consideration
|
(2,897,266
|
)
|
|
—
|
|
|
—
|
|
|||
Payments on long-term debt
|
(18,750,000
|
)
|
|
—
|
|
|
(2,809,806
|
)
|
|||
Net cash provided by (used in) financing activities
|
99,924,461
|
|
|
7,939,271
|
|
|
(3,298,640
|
)
|
|||
Change in cash, cash equivalents, and restricted cash prior to effects of foreign currency exchange rate
|
3,191,217
|
|
|
2,921,155
|
|
|
2,395,641
|
|
|||
Effect of foreign currency exchange rate (translation)
|
(384,237
|
)
|
|
26,822
|
|
|
(138,653
|
)
|
|||
Net increase in cash, cash equivalents, and restricted cash
|
2,806,980
|
|
|
2,947,977
|
|
|
2,256,988
|
|
|||
Cash, cash equivalents, and restricted cash at beginning of period
|
22,246,015
|
|
|
19,298,038
|
|
|
17,041,050
|
|
|||
Cash, cash equivalents, and restricted cash at end of period
|
$
|
25,052,995
|
|
|
$
|
22,246,015
|
|
|
$
|
19,298,038
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
645,372
|
|
|
$
|
16,228
|
|
|
$
|
275,094
|
|
Supplemental disclosure of non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Equity consideration attributable to the acquisition of Skout, Inc.
|
$
|
—
|
|
|
$
|
32,376,505
|
|
|
$
|
—
|
|
Warrant exercise settlement
|
$
|
—
|
|
|
$
|
1,899,733
|
|
|
$
|
—
|
|
|
Balance at
Beginning of
Period
|
|
Additions,
Costs and
Expenses
|
|
Deductions,
Write-Offs
|
|
Balance at
End of the
Period
|
||||||||
Allowance for Doubtful Accounts:
|
|
|
|
|
|
|
|
||||||||
Year Ended December 31, 2017
|
$
|
283,000
|
|
|
$
|
304,306
|
|
|
$
|
59,348
|
|
|
$
|
527,958
|
|
Year Ended December 31, 2016
|
$
|
133,000
|
|
|
$
|
152,587
|
|
|
$
|
2,587
|
|
|
$
|
283,000
|
|
Year Ended December 31, 2015
|
$
|
586,000
|
|
|
$
|
181,398
|
|
|
$
|
634,398
|
|
|
$
|
133,000
|
|
|
Years
|
||||
Trademarks
|
5
|
|
to
|
|
10
|
Domain names
|
5
|
|
to
|
|
10
|
Mobile applications, purchased and internally developed
|
1
|
|
to
|
|
5
|
Customer relationships
|
1
|
|
to
|
|
10
|
|
Years
|
||||
Servers, computer equipment and software
|
1
|
|
to
|
|
3
|
Office furniture and equipment
|
3
|
|
to
|
|
5
|
Leasehold improvements
|
1
|
|
to
|
|
10
|
|
For the Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net (loss) income
|
$
|
(64,591,727
|
)
|
|
$
|
46,268,618
|
|
|
$
|
5,969,628
|
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
||||||
Weighted-average shares outstanding— basic
|
68,743,956
|
|
|
51,963,702
|
|
|
45,419,175
|
|
|||
Effect of dilutive securities
|
—
|
|
|
5,781,950
|
|
|
4,116,651
|
|
|||
Weighted-average shares outstanding— diluted
|
68,743,956
|
|
|
57,745,652
|
|
|
49,535,826
|
|
|||
|
|
|
|
|
|
||||||
Basic income per share
|
$
|
(0.94
|
)
|
|
$
|
0.89
|
|
|
$
|
0.13
|
|
Diluted income per share
|
$
|
(0.94
|
)
|
|
$
|
0.80
|
|
|
$
|
0.12
|
|
|
For the Year Ended December 31,
|
|||||||
|
2017
|
|
2016
|
|
2015
|
|||
Stock options
|
5,653,141
|
|
|
2,832,961
|
|
|
8,052,962
|
|
Unvested restricted stock awards
|
3,534,558
|
|
|
—
|
|
|
184,954
|
|
Warrants
|
—
|
|
|
345,202
|
|
|
2,740,521
|
|
Totals
|
9,187,699
|
|
|
3,178,163
|
|
|
10,978,437
|
|
•
|
Arrangements with Multiple Performance Obligations
- ASU 2014-09 states that the transaction price for contracts with more than one performance obligation should be allocated to each performance obligation. The Company provides the service of publishing advertisements for its customers and evaluated these arrangements for multiple performance obligations. The advertisement publishing services are the same and transferred in the same pattern over a period of time. Therefore, the Company determined that these are a series of distinct performance obligations, which will be treated as one
|
•
|
Principal vs Agent Relationships
- ASU 2014-09 modified some of the existing principal and agent considerations. The Company’s Social Theater contracts utilize third parties to publish customized advertisements for customers. The Company’s third-party arrangements are expected to remain unchanged where the Company will act as principal in these arrangements and gross revenue recognition will remain consistent with current policies.
|
•
|
Contract Costs
-
The Company assessed the impact of ASU 2014-09 on the costs to acquire and fulfill its customer contracts, including whether the Company can apply the practical expedient of expensing contract costs to acquire when incurred if the amortization period of the asset that would have been recognized is
one
year or less. The Company’s existing accounting policy is to expense as incurred any costs to acquire contracts. Due to the amortization period of less than
one
year for the Company’s contracts, under ASU 2014-09, the Company has elected to continue to expense as incurred any costs to acquire contracts.
|
•
|
Breakage
- ASU 2014-09 guidance on breakage requires that an entity establish a liability for the full amount of the prepayment and recognize breakage on that liability into revenue proportionate to the pattern of rights exercised by the customer. The Company currently recognizes breakage in revenue as Credits, Points and Icebreakers are redeemed on a pro rata basis over a three or six month period (life of the user) beginning at the date of the sale. The Company has concluded that this treatment is consistent with the new guidance.
|
|
At October 19, 2017
|
||
Cash consideration
(1)
|
$
|
65,000,000
|
|
Contingent consideration
|
5,000,000
|
|
|
Net working capital adjustment
|
16,148,750
|
|
|
Total consideration
|
$
|
86,148,750
|
|
|
At October 19, 2017
|
||
Cash and cash equivalents
|
$
|
20,717,202
|
|
Accounts receivable
|
3,677,708
|
|
|
Prepaid expenses and other current assets
|
843,930
|
|
|
Property and equipment
|
1,014,716
|
|
|
Intangible assets
|
16,970,000
|
|
|
Accounts payable
|
(1,100,837
|
)
|
|
Accrued expenses and other current liabilities
|
(4,652,757
|
)
|
|
Deferred revenue
|
(1,594,641
|
)
|
|
Deferred tax liability
|
(3,862,337
|
)
|
|
Capital leases
|
(542,112
|
)
|
|
Net assets acquired
|
$
|
31,470,872
|
|
Goodwill
|
54,677,878
|
|
|
Total consideration
|
$
|
86,148,750
|
|
|
Fair Value
|
|
Weighted Average
Amortization Period (Years) |
||
Trademark
|
$
|
12,090,000
|
|
|
10.0
|
Software
|
1,335,000
|
|
|
2.0
|
|
Customer relationships
|
3,545,000
|
|
|
8.7
|
|
Total identifiable intangible assets
|
$
|
16,970,000
|
|
|
9.1
|
|
At April 3, 2017
|
||
|
|
||
Cash consideration
(1)
|
$
|
60,000,000
|
|
Net working capital adjustment
|
14,467,379
|
|
|
Total consideration
|
$
|
74,467,379
|
|
|
At April 3, 2017
|
||
Cash and cash equivalents
|
$
|
8,164,587
|
|
Accounts receivable
|
2,961,593
|
|
|
Prepaid expenses and other current assets
|
5,588,308
|
|
|
Restricted cash
|
500,000
|
|
|
Property and equipment
|
1,476,010
|
|
|
Other assets
|
394,037
|
|
|
Intangible assets
|
23,830,000
|
|
|
Accounts payable
|
(1,632,306
|
)
|
|
Accrued expenses and other current liabilities
|
(783,096
|
)
|
|
Deferred revenue
|
(809,244
|
)
|
|
Deferred tax liability
|
(2,711,883
|
)
|
|
Net assets acquired
|
$
|
36,978,006
|
|
Goodwill
|
37,489,373
|
|
|
Total consideration
|
$
|
74,467,379
|
|
|
Fair Value
|
|
Weighted Average
Amortization Period (Years) |
||
Trademark
|
$
|
9,895,000
|
|
|
10.0
|
Software
|
13,205,000
|
|
|
5.0
|
|
Customer relationships
|
730,000
|
|
|
9.8
|
|
Total identifiable intangible assets
|
$
|
23,830,000
|
|
|
7.2
|
|
At October 3, 2016
|
||
Cash consideration
(1)
|
$
|
33,155,532
|
|
Equity consideration
|
32,376,505
|
|
|
Contingent consideration
|
3,000,000
|
|
|
Total consideration
|
$
|
68,532,037
|
|
|
At October 3, 2016
|
||
Cash and cash equivalents
|
$
|
2,851,338
|
|
Accounts receivable
|
4,146,927
|
|
|
Prepaid expenses and other current assets
|
280,379
|
|
|
Restricted cash
|
393,261
|
|
|
Property and equipment
|
396,998
|
|
|
Deferred tax asset
|
157,111
|
|
|
Intangible assets
|
18,230,000
|
|
|
Accounts payable
|
(1,055,802
|
)
|
|
Accrued expenses and other current liabilities
|
(208,628
|
)
|
|
Deferred revenue
|
(189,066
|
)
|
|
Net assets acquired
|
$
|
25,002,518
|
|
Goodwill
|
43,529,519
|
|
|
Total consideration
|
$
|
68,532,037
|
|
|
Fair Value
|
|
Weighted Average
Amortization Period (Years) |
||
Skout trademark
|
$
|
7,155,000
|
|
|
10.0
|
Software
|
2,500,000
|
|
|
1.0
|
|
Customer relationships
|
8,575,000
|
|
|
10.0
|
|
Total identifiable intangible assets
|
$
|
18,230,000
|
|
|
8.8
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Revenues
|
$
|
162,803,658
|
|
|
$
|
173,497,011
|
|
|
$
|
165,244,333
|
|
Net (loss) income
|
$
|
(62,391,775
|
)
|
|
$
|
48,153,650
|
|
|
$
|
(3,296,998
|
)
|
Basic (loss) earnings per share
|
$
|
(0.91
|
)
|
|
$
|
0.93
|
|
|
$
|
(0.07
|
)
|
Diluted (loss) earnings per share
|
$
|
(0.91
|
)
|
|
$
|
0.83
|
|
|
$
|
(0.07
|
)
|
|
Quoted Prices
in Active
Markets for
Identical
Items
(Level 1)
|
|
Significant Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
December 31, 2017
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Money market
|
$
|
1,390,714
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,390,714
|
|
Restricted cash
|
894,551
|
|
|
—
|
|
|
—
|
|
|
894,551
|
|
||||
Derivative asset
|
—
|
|
|
739,606
|
|
|
—
|
|
|
739,606
|
|
||||
Total assets
|
$
|
2,285,265
|
|
|
$
|
739,606
|
|
|
$
|
—
|
|
|
$
|
3,024,871
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||
Contingent consideration
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,000,000
|
|
|
$
|
5,000,000
|
|
Derivative liability
|
—
|
|
|
3,067,572
|
|
|
—
|
|
|
3,067,572
|
|
||||
Total liabilities
|
$
|
—
|
|
|
$
|
3,067,572
|
|
|
$
|
5,000,000
|
|
|
$
|
8,067,572
|
|
December 31, 2016
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Money market
|
$
|
7,586,810
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,586,810
|
|
Restricted cash
|
393,484
|
|
|
—
|
|
|
—
|
|
|
393,484
|
|
||||
Total assets
|
$
|
7,980,294
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,980,294
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Contingent consideration
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,000,000
|
|
|
$
|
3,000,000
|
|
Total liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,000,000
|
|
|
$
|
3,000,000
|
|
|
Contingent
Consideration
|
|
Convertible
Common Stock
Warrant
Liability
|
||||
Balance as of December 31, 2015
|
$
|
—
|
|
|
$
|
1,035,137
|
|
Amounts acquired
|
3,000,000
|
|
|
—
|
|
||
Changes in estimated fair value
|
—
|
|
|
864,596
|
|
||
Warrant exercise
|
—
|
|
|
(1,899,733
|
)
|
||
Balance as of December 31, 2016
|
$
|
3,000,000
|
|
|
$
|
—
|
|
Amounts acquired
|
5,000,000
|
|
|
—
|
|
||
Changes in estimated fair value
|
(102,734
|
)
|
|
—
|
|
||
Payments
|
(2,897,266
|
)
|
|
—
|
|
||
Balance as of December 31, 2017
|
$
|
5,000,000
|
|
|
$
|
—
|
|
|
Goodwill
|
||
Balance at December 31, 2015
|
$
|
70,646,035
|
|
Goodwill acquired from Skout Acquisition
|
43,529,519
|
|
|
Balance at December 31, 2016
|
114,175,554
|
|
|
Goodwill acquired from if(we) Acquisition
|
37,489,373
|
|
|
Goodwill acquired from Lovoo Acquisition
|
54,677,878
|
|
|
Goodwill impairment
|
(56,428,861
|
)
|
|
Foreign currency translation adjustments
|
780,191
|
|
|
Balance at December 31, 2017
|
$
|
150,694,135
|
|
|
December 31, 2017
|
||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||
Trademarks and domain names
|
$
|
35,204,638
|
|
|
$
|
(8,952,725
|
)
|
|
$
|
26,251,913
|
|
Customer relationships
|
14,067,457
|
|
|
(3,677,895
|
)
|
|
10,389,562
|
|
|||
Software
|
18,784,755
|
|
|
(6,706,802
|
)
|
|
12,077,953
|
|
|||
Total
|
$
|
68,056,850
|
|
|
$
|
(19,337,422
|
)
|
|
$
|
48,719,428
|
|
|
December 31, 2016
|
||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||
Trademarks and domain names
|
$
|
13,014,494
|
|
|
$
|
(6,157,445
|
)
|
|
$
|
6,857,049
|
|
Customer relationships
|
9,740,000
|
|
|
(1,461,484
|
)
|
|
8,278,516
|
|
|||
Software
|
4,225,000
|
|
|
(2,350,000
|
)
|
|
1,875,000
|
|
|||
Total
|
$
|
26,979,494
|
|
|
$
|
(9,968,929
|
)
|
|
$
|
17,010,565
|
|
Year ending December 31,
|
Amortization Expense
|
||
2018
|
$
|
11,556,173
|
|
2019
|
9,586,767
|
|
|
2020
|
7,629,207
|
|
|
2021
|
6,608,856
|
|
|
2022
|
4,013,978
|
|
|
Thereafter
|
9,324,447
|
|
|
Total
|
$
|
48,719,428
|
|
|
December 31, 2017
|
|
December 31, 2016
|
||||
Servers, computer equipment and software
|
$
|
14,044,505
|
|
|
$
|
10,273,823
|
|
Office furniture and equipment
|
521,233
|
|
|
232,217
|
|
||
Leasehold improvements
|
663,356
|
|
|
443,123
|
|
||
|
15,229,094
|
|
|
10,949,163
|
|
||
Less accumulated depreciation
|
(10,704,976
|
)
|
|
(8,483,053
|
)
|
||
Property and equipment - net
|
$
|
4,524,118
|
|
|
$
|
2,466,110
|
|
|
December 31, 2017
|
|
December 31, 2016
|
||||
Principal
|
$
|
56,250,000
|
|
|
$
|
—
|
|
Less: Debt discount, net
|
(612,894
|
)
|
|
—
|
|
||
Net carrying amount
|
$
|
55,637,106
|
|
|
$
|
—
|
|
Less: current portion
|
15,000,000
|
|
|
—
|
|
||
Long-term debt, net
|
$
|
40,637,106
|
|
|
$
|
—
|
|
|
Capital
Leases |
|
Operating
Leases |
|
Cloud Data Storage
|
||||||
2018
|
$
|
271,829
|
|
|
$
|
4,573,691
|
|
|
$
|
126,331
|
|
2019
|
152,209
|
|
|
2,451,287
|
|
|
478,506
|
|
|||
2020
|
40,732
|
|
|
967,326
|
|
|
682,329
|
|
|||
2021
|
5,038
|
|
|
612,619
|
|
|
1,014,517
|
|
|||
2022
|
—
|
|
|
283,302
|
|
|
1,115,969
|
|
|||
2023
|
—
|
|
|
—
|
|
|
1,227,566
|
|
|||
Total minimum payments
|
$
|
469,808
|
|
|
$
|
8,888,225
|
|
|
$
|
4,645,218
|
|
Less: Amount representing interest
|
23,272
|
|
|
|
|
|
|
||||
Total present value of minimum payments
|
446,536
|
|
|
|
|
|
|
||||
Less: Current portion of such obligations
|
254,399
|
|
|
|
|
|
|
||||
Long-term capital lease obligations
|
$
|
192,137
|
|
|
|
|
|
|
|
|
New Term Loan Facility
(1)
|
||
2018
|
|
$
|
15,000,000
|
|
2019
|
|
15,000,000
|
|
|
2020
|
|
26,250,000
|
|
|
Total minimum loan payments
|
|
$
|
56,250,000
|
|
(1)
|
Interest rates on the New Term Loan Facility are variable in nature, however, the Company is party to a fixed-pay amortizing interest rate swap having a remaining notional amount of
$41.3 million
and a non-amortizing interest rate cap with a notional amount of
$15.0 million
. If interest rates were to remain at the
December 31, 2017
level, we would make interest payments of
$0.2 million
in
2018
and
2019
, respectively, of net settlements on the fixed-pay amortizing interest rate swap.
|
|
For the Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Sales and marketing
|
$
|
439,797
|
|
|
$
|
354,088
|
|
|
$
|
309,708
|
|
Product development and content
|
4,008,545
|
|
|
1,528,547
|
|
|
1,197,696
|
|
|||
General and administrative
|
4,018,936
|
|
|
1,685,352
|
|
|
1,409,023
|
|
|||
Total stock-based compensation for vesting of options and RSA's
|
8,467,278
|
|
|
3,567,987
|
|
|
2,916,427
|
|
|||
Warrant modification
|
—
|
|
|
—
|
|
|
425,538
|
|
|||
Total stock-based compensation expense
|
$
|
8,467,278
|
|
|
$
|
3,567,987
|
|
|
$
|
3,341,965
|
|
Options
|
|
Number of
Stock Options
|
|
Weighted-
Average
Exercise Price
|
|
Weighted-
Average
Remaining
Contractual Life
|
|
Aggregate
Intrinsic Value
|
|||||
Outstanding at December 31, 2016
|
|
2,822,855
|
|
|
$
|
2.42
|
|
|
|
|
|
|
|
Granted
|
|
1,227,851
|
|
|
4.74
|
|
|
|
|
|
|
||
Exercised
|
|
(100,015
|
)
|
|
2.10
|
|
|
|
|
|
|
||
Forfeited or expired
|
|
(225,799
|
)
|
|
4.37
|
|
|
|
|
|
|
||
Outstanding at December 31, 2017
|
|
3,724,892
|
|
|
$
|
3.07
|
|
|
7.8
|
|
$
|
1,582,812
|
|
Exercisable at December 31, 2017
|
|
2,384,981
|
|
|
$
|
2.48
|
|
|
7.1
|
|
$
|
1,385,939
|
|
|
For the Years Ended December 31,
|
|||||||
|
2017
|
|
2016
|
|
2015
|
|||
Risk-free interest rate
|
1.90
|
%
|
|
1.39
|
%
|
|
1.37
|
%
|
Expected term (in years)
|
6.0
|
|
|
6.0
|
|
|
5.9
|
|
Expected dividend yield
|
—
|
|
|
—
|
|
|
—
|
|
Expected volatility
|
83
|
%
|
|
84
|
%
|
|
87
|
%
|
RSA's
|
Number of
RSAs
|
|
Weighted-Average
Stock Price
|
|||
Outstanding at December 31, 2016
|
1,794,115
|
|
|
$
|
2.46
|
|
Granted
|
1,873,294
|
|
|
4.34
|
|
|
Exercised
|
(1,100,401
|
)
|
|
2.47
|
|
|
Forfeited or expired
|
(274,700
|
)
|
|
4.27
|
|
|
Outstanding and unvested at December 31, 2017
|
2,292,308
|
|
|
$
|
3.77
|
|
Options
|
|
Number of
Stock Options
|
|
Weighted-Average
Exercise Price
|
|
Weighted-Average
Remaining
Contractual Life
|
|
Aggregate Intrinsic
Value
|
|||||
Outstanding at December 31, 2016
|
|
3,041,686
|
|
|
$
|
2.62
|
|
|
|
|
|
|
|
Granted
|
|
—
|
|
|
—
|
|
|
|
|
|
|
||
Exercised
|
|
(1,664,177
|
)
|
|
1.31
|
|
|
|
|
|
|
||
Forfeited or expired
|
|
(183,428
|
)
|
|
4.94
|
|
|
|
|
|
|
||
Outstanding at December 31, 2017
|
|
1,194,081
|
|
|
$
|
4.08
|
|
|
3.8
|
|
$
|
3,768
|
|
Exercisable at December 31, 2017
|
|
1,149,902
|
|
|
$
|
4.09
|
|
|
3.9
|
|
$
|
3,768
|
|
Options
|
|
Number of
Stock Options
|
|
Weighted-
Average
Exercise Price
|
|
Weighted-
Average
Remaining
Contractual Life
|
|
Aggregate
Intrinsic Value
|
|||||
Outstanding at December 31, 2016
|
|
310,000
|
|
|
$
|
6.02
|
|
|
|
|
|
||
Granted
|
|
575,000
|
|
|
4.95
|
|
|
|
|
|
|||
Exercised
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
Forfeited or expired
|
|
(150,832
|
)
|
|
6.03
|
|
|
|
|
|
|||
Outstanding at December 31, 2017
|
|
734,168
|
|
|
$
|
5.18
|
|
|
9.1
|
|
$
|
—
|
|
Exercisable at December 31, 2017
|
|
80,834
|
|
|
$
|
6.04
|
|
|
8.8
|
|
$
|
—
|
|
|
Year Ended December 31,
|
||||
|
2017
|
|
2016
|
||
Risk-free interest rate
|
1.89
|
%
|
|
1.21
|
%
|
Expected term (in years)
|
6.0
|
|
|
6.0
|
|
Expected dividend yield
|
—
|
|
|
—
|
|
Expected volatility
|
84
|
%
|
|
85
|
%
|
RSAs
|
|
Number of
RSAs
|
|
Weighted-Average
Stock Price
|
|||
Outstanding at December 31, 2016
|
|
—
|
|
|
$
|
—
|
|
Granted
|
|
1,539,250
|
|
|
4.80
|
|
|
Vested
|
|
—
|
|
|
—
|
|
|
Forfeited or expired
|
|
(297,000
|
)
|
|
5.55
|
|
|
Outstanding and unvested at December 31, 2017
|
|
1,242,250
|
|
|
$
|
4.62
|
|
Options
|
|
Number of
Stock Options
|
|
Weighted-
Average
Exercise Price
|
|
Weighted-
Average
Remaining
Contractual Life
|
|
Aggregate
Intrinsic Value
|
||||||
Outstanding at December 31, 2016
|
|
316,456
|
|
|
$
|
1.34
|
|
|
|
|
|
|||
Granted
|
|
—
|
|
|
—
|
|
|
|
|
|
||||
Exercised
|
|
(316,456
|
)
|
|
1.34
|
|
|
|
|
|
||||
Forfeited or expired
|
|
—
|
|
|
—
|
|
|
|
|
|
||||
Outstanding at December 31, 2017
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
Warrants as of December 31,
|
|
Weighted-Average Exercise Price
|
|
|
|
Balance Sheet Classification as of
|
||||||
|
2017
|
|
2016
|
|
|
Expiration
|
|
2016
|
|||||
Allen, F. Stephen Series 3
|
—
|
|
|
425,000
|
|
|
$
|
3.55
|
|
|
6/21/2017
|
|
Equity
|
OTA LLC Series 2
|
—
|
|
|
250,000
|
|
|
$
|
3.55
|
|
|
6/21/2017
|
|
Equity
|
All warrants
|
—
|
|
|
675,000
|
|
|
|
|
|
|
|
Warrants
|
|
Number of
warrants
|
|
Weighted-average
exercise price
|
|||
Outstanding at December 31, 2016
|
|
675,000
|
|
|
$
|
3.55
|
|
Granted
|
|
—
|
|
|
—
|
|
|
Exercised
|
|
(675,000
|
)
|
|
3.55
|
|
|
Forfeited or expired
|
|
—
|
|
|
—
|
|
|
Outstanding at December 31, 2017
|
|
—
|
|
|
$
|
—
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Federal:
|
|
|
|
|
|
||||||
Current
|
$
|
20,870
|
|
|
$
|
150,233
|
|
|
$
|
224,980
|
|
Deferred
|
6,637,417
|
|
|
(26,783,983
|
)
|
|
—
|
|
|||
Total federal
|
6,658,287
|
|
|
(26,633,750
|
)
|
|
224,980
|
|
|||
State:
|
|
|
|
|
|
||||||
Current
|
(32,456
|
)
|
|
71,120
|
|
|
51,321
|
|
|||
Deferred
|
(74,368
|
)
|
|
(1,312,732
|
)
|
|
—
|
|
|||
Total state
|
(106,824
|
)
|
|
(1,241,612
|
)
|
|
51,321
|
|
|||
Foreign:
|
|
|
|
|
|
||||||
Current
|
293,331
|
|
|
—
|
|
|
—
|
|
|||
Deferred
|
(141,194
|
)
|
|
—
|
|
|
—
|
|
|||
Total foreign
|
152,137
|
|
|
—
|
|
|
—
|
|
|||
Provision (benefit) for income taxes
|
$
|
6,703,600
|
|
|
$
|
(27,875,362
|
)
|
|
$
|
276,301
|
|
|
December 31, 2017
|
|
December 31, 2016
|
||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforward
|
$
|
18,092,988
|
|
|
$
|
27,342,311
|
|
Property and equipment
|
326,229
|
|
|
—
|
|
||
Stock options and warrants
|
2,796,366
|
|
|
4,999,444
|
|
||
Federal and state tax credits
|
6,208,362
|
|
|
823,914
|
|
||
Accrued liabilities and other reserves
|
1,514,995
|
|
|
1,231,073
|
|
||
Other comprehensive income
|
309,436
|
|
|
—
|
|
||
Other
|
476,910
|
|
|
—
|
|
||
Total deferred tax assets
|
29,725,286
|
|
|
34,396,742
|
|
||
Valuation allowance
|
(2,512,045
|
)
|
|
—
|
|
||
Net deferred tax assets
|
27,213,241
|
|
|
34,396,742
|
|
||
Deferred tax liabilities
|
|
|
|
||||
Property and equipment
|
—
|
|
|
(212,327
|
)
|
||
Amortization of intangible assets
|
(11,692,027
|
)
|
|
(5,930,588
|
)
|
||
Total deferred tax liabilities
|
(11,692,027
|
)
|
|
(6,142,915
|
)
|
||
Net deferred tax assets
|
$
|
15,521,214
|
|
|
$
|
28,253,827
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
U.S. federal income tax at statutory rate
|
$
|
(20,260,844
|
)
|
|
$
|
6,437,639
|
|
|
$
|
2,123,616
|
|
State tax benefit, net of federal provision (benefit)
|
(21,096
|
)
|
|
(1,266,504
|
)
|
|
20,672
|
|
|||
Effect of rates different than statutory
|
(311,304
|
)
|
|
—
|
|
|
—
|
|
|||
Goodwill impairment
|
19,750,101
|
|
|
—
|
|
|
—
|
|
|||
Windfall tax benefit
|
(2,155,157
|
)
|
|
(2,957,837
|
)
|
|
—
|
|
|||
Fair market value adjustment for warrants
|
—
|
|
|
302,609
|
|
|
—
|
|
|||
Transaction costs
|
819,251
|
|
|
607,528
|
|
|
209,646
|
|
|||
Sec. 162(m) Excess Officer's Compensation
|
283,351
|
|
|
476,339
|
|
|
—
|
|
|||
Nondeductible expenses
|
825,169
|
|
|
56,018
|
|
|
—
|
|
|||
Stock compensation forfeitures and other
|
562,155
|
|
|
1,195,454
|
|
|
34,334
|
|
|||
Loss on foreign investments
|
—
|
|
|
(649,998
|
)
|
|
|
|
|||
Rate change
|
7,670,606
|
|
|
(909,045
|
)
|
|
—
|
|
|||
Other
|
(146,909
|
)
|
|
72,184
|
|
|
20,347
|
|
|||
Dissolution of foreign entity
|
(1,124,781
|
)
|
|
—
|
|
|
—
|
|
|||
Repatriation tax
|
81,808
|
|
|
—
|
|
|
—
|
|
|||
Change in valuation allowance
|
731,250
|
|
|
(31,247,234
|
)
|
|
(2,168,528
|
)
|
|||
Foreign subsidiary loss with no tax benefit
|
—
|
|
|
7,485
|
|
|
36,214
|
|
|||
(Benefit) provision for income taxes
|
$
|
6,703,600
|
|
|
$
|
(27,875,362
|
)
|
|
$
|
276,301
|
|
|
2017
|
||
Unrecognized tax liabilities— January 1
|
$
|
—
|
|
Gross increases— tax positions in prior year
|
2,029,653
|
|
|
Unrecognized tax liabilities— December 31
|
$
|
2,029,653
|
|
|
|
Number of
|
|
At Inception
|
|
At December 31, 2017
|
Interest Rate Derivative
|
|
Instruments
|
|
Notional
|
|
Notional
|
Interest rate swaps
|
|
1
|
|
$45,000,000
|
|
$41,250,000
|
Interest rate caps
|
|
1
|
|
$15,000,000
|
|
$15,000,000
|
Foreign Currency Derivative
|
|
Number of Instruments
|
|
Pay Fixed Notional
|
|
Receive Fixed Notional
|
Cross-currency interest rate swap
|
|
1
|
|
€42,000,517
|
|
$48,750,000
|
|
|
|
|
(amortizing to €41,138,968 as of December 31, 2017)
|
|
(amortizing to $47,750,000 as of December 31, 2017)
|
|
|
|
|
Fair Value of Derivative Instruments
|
||||||||||||||
|
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||
|
|
|
|
As of December 31,
|
|
As of December 31,
|
||||||||||||
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Derivatives Designated as Hedging Instruments
|
|
Balance Sheet Location
|
|
Fair Value
|
|
Fair Value
|
|
Fair Value
|
|
Fair Value
|
||||||||
Interest rate products
|
|
Other assets/liabilities - current
|
|
$
|
243
|
|
|
$
|
—
|
|
|
$
|
(71,915
|
)
|
|
$
|
—
|
|
Interest rate products
|
|
Other assets - non-current
|
|
84,058
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Cross currency contract
|
|
Other assets - current
|
|
655,305
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Cross currency contract
|
|
Long-term derivative liability
|
|
—
|
|
|
—
|
|
|
(2,995,657
|
)
|
|
—
|
|
||||
Total derivatives designated as hedging instruments
|
|
|
|
$
|
739,606
|
|
|
$
|
—
|
|
|
$
|
(3,067,572
|
)
|
|
$
|
—
|
|
Derivatives in Subtopic 815-20 Hedging Relationships
|
|
Amount of Gain or (Loss) Recognized in OCI on Derivatives
|
|
Location of Gain or (Loss) Reclassified from Accumulated OCI into Income
|
|
Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income
|
||||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
|
|
2017
|
|
2016
|
|
2015
|
||||||||||||
Derivatives in Cash Flow Hedging Relationships
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate products
|
|
$
|
(75,604
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Interest expense
|
|
$
|
(37,427
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Cross currency contract
|
|
(2,226,811
|
)
|
|
—
|
|
|
—
|
|
|
Interest expense
|
|
147,223
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
(Loss) gain on foreign currency adjustment
|
|
(1,675,692
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Total
|
|
$
|
(2,302,415
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
$
|
(1,565,896
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
2017
|
|
2016
|
||||||||||
|
|
Interest Expense
|
|
Loss on Foreign Currency Adjustment
|
|
Interest Expense
|
|
Gain on Foreign Currency Adjustment
|
||||||
Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded
|
|
(860,392
|
)
|
|
(32,488
|
)
|
|
(19,388
|
)
|
|
33,416
|
|
||
Gain or (loss) on cash flow hedging relationships in Subtopic 815-20
|
|
|
|
|
|
|
|
|
||||||
Interest contracts
|
|
|
|
|
|
|
|
|
||||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income
|
|
$
|
109,796
|
|
|
$
|
(1,675,692
|
)
|
|
—
|
|
|
—
|
|
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income as a result that a forecasted transaction is no longer probable of occurring
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
|
For the Quarters Ended,
|
||||||||||||||
|
2017
|
||||||||||||||
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
||||||||
Revenues
|
$
|
40,119,076
|
|
|
$
|
32,246,472
|
|
|
$
|
31,329,468
|
|
|
$
|
20,058,797
|
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Sales and marketing
|
6,050,466
|
|
|
4,600,148
|
|
|
4,599,842
|
|
|
5,105,508
|
|
||||
Product development and content
|
19,698,097
|
|
|
16,021,977
|
|
|
16,526,905
|
|
|
8,457,494
|
|
||||
General and administrative
|
6,504,840
|
|
|
5,021,739
|
|
|
5,160,799
|
|
|
2,862,427
|
|
||||
Depreciation and amortization
|
3,954,243
|
|
|
2,969,570
|
|
|
2,965,175
|
|
|
1,684,839
|
|
||||
Acquisition and restructuring
|
3,502,800
|
|
|
3,378,838
|
|
|
3,769,425
|
|
|
1,500,429
|
|
||||
Goodwill impairment
|
56,428,861
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total operating costs and expenses
|
96,139,307
|
|
|
31,992,272
|
|
|
33,022,146
|
|
|
19,610,697
|
|
||||
(Loss) income from operations
|
(56,020,231
|
)
|
|
254,200
|
|
|
(1,692,678
|
)
|
|
448,100
|
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Interest income
|
387
|
|
|
1,374
|
|
|
1,400
|
|
|
2,570
|
|
||||
Interest expense
|
(438,445
|
)
|
|
(244,361
|
)
|
|
(175,254
|
)
|
|
(2,332
|
)
|
||||
(Loss) gain on foreign currency adjustment
|
(30,416
|
)
|
|
9,357
|
|
|
(9,229
|
)
|
|
(2,200
|
)
|
||||
Other
|
9,631
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total other expense
|
(458,843
|
)
|
|
(233,630
|
)
|
|
(183,083
|
)
|
|
(1,962
|
)
|
||||
(Loss) income before income tax (expense) benefit
|
(56,479,074
|
)
|
|
20,570
|
|
|
(1,875,761
|
)
|
|
446,138
|
|
||||
Income tax (expense) benefit
|
(11,637,816
|
)
|
|
2,202,152
|
|
|
2,732,356
|
|
|
(292
|
)
|
||||
Net (loss) income
|
$
|
(68,116,890
|
)
|
|
$
|
2,222,722
|
|
|
$
|
856,595
|
|
|
$
|
445,846
|
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted net (loss) income per common stockholders:
|
|
|
|
|
|
|
|
||||||||
Basic net (loss) income per common stockholders
|
$
|
(0.95
|
)
|
|
$
|
0.03
|
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
Diluted net (loss) income per common stockholders
|
$
|
(0.95
|
)
|
|
$
|
0.03
|
|
|
$
|
0.01
|
|
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
71,808,179
|
|
|
71,800,274
|
|
|
70,122,234
|
|
|
61,093,810
|
|
||||
Diluted
|
71,808,179
|
|
|
76,078,563
|
|
|
74,885,903
|
|
|
66,204,620
|
|
|
For the Quarters Ended,
|
||||||||||||||
|
2016
|
||||||||||||||
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
||||||||
Revenues
|
$
|
29,222,186
|
|
|
$
|
17,191,261
|
|
|
$
|
16,388,991
|
|
|
$
|
13,321,671
|
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Sales and marketing
|
6,313,958
|
|
|
3,228,262
|
|
|
3,226,344
|
|
|
2,321,423
|
|
||||
Product development and content
|
8,059,563
|
|
|
5,808,449
|
|
|
6,214,062
|
|
|
5,708,100
|
|
||||
General and administrative
|
3,063,319
|
|
|
2,215,727
|
|
|
1,867,590
|
|
|
2,348,168
|
|
||||
Depreciation and amortization
|
1,802,568
|
|
|
761,460
|
|
|
753,918
|
|
|
751,264
|
|
||||
Acquisition and restructuring
|
829,169
|
|
|
467,777
|
|
|
1,160,349
|
|
|
—
|
|
||||
Total operating costs and expenses
|
20,068,577
|
|
|
12,481,675
|
|
|
13,222,263
|
|
|
11,128,955
|
|
||||
Income from operations
|
9,153,609
|
|
|
4,709,586
|
|
|
3,166,728
|
|
|
2,192,716
|
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Interest income
|
2,488
|
|
|
7,135
|
|
|
6,447
|
|
|
5,115
|
|
||||
Interest expense
|
(3,160
|
)
|
|
(4,123
|
)
|
|
(5,360
|
)
|
|
(6,745
|
)
|
||||
Change in warrant liability
|
—
|
|
|
(318,983
|
)
|
|
(787,391
|
)
|
|
241,777
|
|
||||
(Loss) gain on foreign currency adjustment
|
69
|
|
|
(1,206
|
)
|
|
18,201
|
|
|
16,352
|
|
||||
Total other (expense) income
|
(603
|
)
|
|
(317,177
|
)
|
|
(768,103
|
)
|
|
256,499
|
|
||||
Income before income taxes
|
9,153,006
|
|
|
4,392,409
|
|
|
2,398,625
|
|
|
2,449,215
|
|
||||
Income tax benefit (expense)
|
749,916
|
|
|
—
|
|
|
27,219,764
|
|
|
(94,317
|
)
|
||||
Net income
|
$
|
9,902,922
|
|
|
$
|
4,392,409
|
|
|
$
|
29,618,389
|
|
|
$
|
2,354,898
|
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted net income per common stockholders:
|
|
|
|
|
|
|
|
||||||||
Basic net income per common stockholders
|
$
|
0.17
|
|
|
$
|
0.08
|
|
|
$
|
0.61
|
|
|
$
|
0.05
|
|
Diluted net income per common stockholders
|
$
|
0.15
|
|
|
$
|
0.07
|
|
|
$
|
0.55
|
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
58,856,831
|
|
|
53,231,369
|
|
|
48,218,184
|
|
|
47,458,748
|
|
||||
Diluted
|
64,121,470
|
|
|
59,048,821
|
|
|
54,061,306
|
|
|
53,666,626
|
|
|
|
|
|
|
|
|
|
|
|
Filed or
|
|
|
|
|
Incorporated by Reference
|
|
Furnished
|
||||
Exhibit No.
|
|
Exhibit Description
|
|
Form
|
|
Date
|
|
Number
|
|
Herewith
|
|
Agreement of Merger and Plan of Merger and Reorganization – Delaware Reincorporation
|
|
8-K
|
|
12/8/2011
|
|
2.1
|
|
|
|
|
Agreement and Plan of Merger among Quepasa, IG Acquisition Company and Insider Guides, Inc. dated July 19, 2011*
|
|
8-K
|
|
7/20/2011
|
|
2.1
|
|
|
|
|
Amendment to the Agreement and Plan of Merger among Quepasa Corporation, IG Acquisition Company and Insider Guides, Inc. dated July 19, 2011
|
|
8-K
|
|
9/21/2011
|
|
2.1
|
|
|
|
|
Agreement and Plan of Merger among MeetMe, Inc., MeetMe Sub I, Inc., MeetMe Sub II, LLC, Skout, Inc. and Shareholder Representative Services LLC dated June 27, 2016.
|
|
8-K
|
|
6/28/2016
|
|
2.1
|
|
|
|
|
Agreement and Plan of Merger, dated as of March 3, 2017, by and among MeetMe, Inc. Two Sub One, Inc., Ifwe Inc. and Shareholder Representative Services LLC
|
|
8-K
|
|
3/6/2017
|
|
2.1
|
|
|
|
|
Share Purchase Agreement, dated as of September 18, 2017, by and among The Meet Group, Inc., TMG Holding Germany Gmbh, Bawogo Ventures Gmbh & Co. KG and the Shareholder guarantors set forth therein
|
|
8-K
|
|
9/20/2017
|
|
2.1
|
|
|
|
|
Certificate of Incorporation
|
|
8-K
|
|
12/8/2011
|
|
3.1
|
|
|
|
|
Certificate of Amendment to the Certificate of Incorporation – Name Change
|
|
10-Q
|
|
8/9/2012
|
|
3.2
|
|
|
|
|
Amended and Restated Bylaws
|
|
8-K
|
|
12/23/2016
|
|
3.1
|
|
|
|
|
Amended and Restated 2006 Stock Incentive Plan**
|
|
10-Q
|
|
8/9/2010
|
|
10.1
|
|
|
|
|
Amendment to the Amended and Restated 2006 Stock Incentive Plan**
|
|
S-8
|
|
7/1/2011
|
|
4.1
|
|
|
|
|
Amended and Restated 2012 Omnibus Incentive Plan**
|
|
10-K
|
|
3/9/2017
|
|
10.3
|
|
|
|
|
2012 Management Bonus Plan**
|
|
8-K
|
|
8/21/2012
|
|
10.1
|
|
|
|
|
John Abbott Employment Agreement**
|
|
8-K
|
|
10/30/2007
|
|
10.2
|
|
|
|
|
Abbott Employment Agreement Amendment No. 1**
|
|
10-KSB
|
|
3/31/2008
|
|
10.18
|
|
|
|
|
Abbott Employment Agreement Amendment No. 2**
|
|
S-1
|
|
12/29/2010
|
|
10.6
|
|
|
|
|
Abbott Employment Agreement Amendment No. 3**
|
|
10-K
|
|
3/13/2015
|
|
10.8
|
|
|
|
|
|
|
|
|
|
|
|
|
Filed or
|
|
|
|
|
Incorporated by Reference
|
|
Furnished
|
||||
Exhibit No.
|
|
Exhibit Description
|
|
Form
|
|
Date
|
|
Number
|
|
Herewith
|
|
Michael Matte Employment Agreement**
|
|
8-K
|
|
10/30/2007
|
|
10.3
|
|
|
|
|
Matte Employment Agreement Amendment No. 1**
|
|
10-KSB
|
|
3/31/2008
|
|
10.21
|
|
|
|
|
Matte Employment Agreement Amendment No. 2**
|
|
S-1
|
|
12/29/2010
|
|
10.9
|
|
|
|
|
Matte Employment Agreement Amendment No. 3**
|
|
10-K
|
|
3/14/2013
|
|
10.11
|
|
|
|
|
Geoffrey Cook Employment Agreement**
|
|
8-K
|
|
7/20/2011
|
|
10.5
|
|
|
|
|
Cook Employment Agreement Amendment No. 1**
|
|
10-Q
|
|
5/10/2013
|
|
10.2
|
|
|
|
|
Cook Employment Agreement Amendment No. 2**
|
|
10-Q
|
|
8/9/2013
|
|
10.1
|
|
|
|
|
David Clark Employment Agreement **
|
|
10-Q
|
|
5/10/2013
|
|
10.3
|
|
|
|
|
David Clark Transition Services and Separation Agreement
|
|
8-K
|
|
11/9/2017
|
|
10.1
|
|
|
|
|
Form of Amended and Restated Employment Agreement (William Alena, Frederic Beckley, and Jonah Harris)**
|
|
10-Q
|
|
11/9/2016
|
|
10.2
|
|
|
|
|
Niklas Lindstrom Offer Letter
|
|
|
|
|
|
|
|
Filed
|
|
|
Form of Media Publisher Agreement with Beanstock Media Inc.#
|
|
10-Q
|
|
11/8/2013
|
|
10.3
|
|
|
|
|
Advertising Agreement with Beanstock Media, Inc.#
|
|
10-K
|
|
3/13/2015
|
|
10.23
|
|
|
|
|
Amendment No. 1 to Advertising Agreement with Beanstock Media, Inc.#
|
|
10-Q
|
|
5/8/2015
|
|
10.1
|
|
|
|
|
Amendment of and Joinder to Advertising Agreement with Beanstock Media, Inc.
|
|
10-Q
|
|
5/8/2015
|
|
10.2
|
|
|
|
|
Notice of Termination, dated June 2, 2015
|
|
8-K
|
|
6/3/2015
|
|
10.1
|
|
|
|
|
Amendment No. 2 to Advertising Agreement with Beanstock Media, Inc.
|
|
10-Q
|
|
8/4/2015
|
|
10.1
|
|
|
|
|
RSI LLC Promissory Note
|
|
8-K
|
|
1/30/2008
|
|
10.12
|
|
|
|
|
MeetMoi LLC Promissory Note
|
|
10-Q
|
|
5/10/2013
|
|
10.4
|
|
|
|
|
Form of Employee Option Agreement
|
|
10-K
|
|
3/14/2012
|
|
10.22
|
|
|
|
|
Form of Director Option Agreement**
|
|
10-K
|
|
3/14/2013
|
|
10.27
|
|
|
|
|
Form of Indemnification Agreement
|
|
S-4
|
|
8/11/2011
|
|
10.29
|
|
|
|
|
Form of Indemnification Agreement – Lewis
|
|
S-4
|
|
8/11/2011
|
|
10.30
|
|
|
|
|
Form of Indemnification Agreement
|
|
8-K
|
|
12/6/2013
|
|
10.1
|
|
|
|
|
Amended and Restated Common Stock Purchase Warrant – Series 2 with F. Stephan Allen dated December 22, 2015
|
|
8-K
|
|
12/24/2015
|
|
10.1
|
|
|
|
|
Amended and Restated Common Stock Purchase Warrant – Series 3 with F. Stephan Allen dated December 22, 2015
|
|
8-K
|
|
12/24/2015
|
|
10.2
|
|
|
|
|
Credit Agreement, dated as of March 3, 2017, with the several banks and other financial institutions party thereto and JPMorgan Chase Bank, N.A., as administrative agent
|
|
8-K
|
|
3/6/2017
|
|
10.1
|
|
|
|
|
Amended and Restated Credit Agreement, dated as of September 18, 2017, with the several banks and other financial institutions party thereto and JPMorgan Chase Bank, N.A., as administrative agent
|
|
8-K
|
|
9/20/2017
|
|
10.1
|
|
|
|
|
First Amendment to Amended and Restated Credit Agreement, dated as of October 18, 2017, with the several banks and other financial institutions party thereto and JPMorgan Chase Bank, N.A., as administrative agent
|
|
8-K
|
|
10/20/2017
|
|
10.1
|
|
|
|
|
Second Amendment to Amended and Restated Credit Agreement, dated as of March 7, 2018, with the several banks and other financial institutions party thereto and JPMorgan Chase Bank, N.A., as administrative agent
|
|
8-K
|
|
3/8/2018
|
|
10.1
|
|
|
|
|
|
|
|
|
|
|
|
|
Filed or
|
|
|
|
|
Incorporated by Reference
|
|
Furnished
|
||||
Exhibit No.
|
|
Exhibit Description
|
|
Form
|
|
Date
|
|
Number
|
|
Herewith
|
|
Cooperation Agreement dated June 27, 2017 by and among The Meet Group, Inc. and Harvest Small Cap Partners Master Ltd., Harvest Small Cap Partners, LP, Harvest Small Cap Partners GP, LLC, Harvest Capital Strategies LLC, and Jeffrey B. Osher.
|
|
8-K
|
|
6/29/2017
|
|
10.1
|
|
|
|
|
Cooperation Agreement dated January 5, 2018 by and among The Meet Group, Inc. and Kanen Wealth Management LLC and David L. Kanen
|
|
8-K
|
|
1/9/2018
|
|
10.1
|
|
|
|
|
List of Subsidiaries
|
|
|
|
|
|
|
|
Filed
|
|
|
Consent of RSM US LLP
|
|
|
|
|
|
|
|
Filed
|
|
|
Certification of Principal Executive Officer (Section 302)
|
|
|
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|
|
|
|
Filed
|
|
|
Certification of Principal Financial Officer (Section 302)
|
|
|
|
|
|
|
|
Filed
|
|
|
Certification of Principal Executive Officer (Section 906)
|
|
|
|
|
|
|
|
Furnished
|
|
|
Certification of Principal Financial Officer (Section 906)
|
|
|
|
|
|
|
|
Furnished
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
|
|
|
|
****
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
****
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
****
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
****
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
****
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
****
|
(i)
|
the representations and warranties contained in the agreement were made for the purposes of allocating contractual risk between the parties and not as a means of establishing facts;
|
(ii)
|
the agreement may have different standards of materiality than standards of materiality under applicable securities laws;
|
(iii)
|
the representations are qualified by a confidential disclosure schedule that contains nonpublic information that is not material under applicable securities laws;
|
(iv)
|
facts may have changed since the date of the agreement; and
|
(v)
|
only parties to the agreement and specified third-party beneficiaries have a right to enforce the agreement.
|
|
THE MEET GROUP, INC.
|
|
|
|
|
|
By:
|
/s/Geoffrey Cook
|
|
|
Geoffrey Cook
|
|
|
Chief Executive Officer
|
Signatures
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/Geoffrey Cook
|
|
Director and Chief Executive Officer
|
|
March 16, 2018
|
Geoffrey Cook
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/James Bugden
|
|
Chief Financial Officer
|
|
March 16, 2018
|
James Bugden
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
/s/Michael Johnson
|
|
Chief Accounting Officer
|
|
March 16, 2018
|
Michael Johnson
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
|
|
/s/Spencer Rhodes
|
|
Director, Chairman of the Board of Directors
|
|
March 16, 2018
|
Spencer Rhodes
|
|
|
|
|
|
|
|
|
|
/s/Jean Clifton
|
|
Director
|
|
March 16, 2018
|
Jean Clifton
|
|
|
|
|
|
|
|
|
|
/s/Christopher Fralic
|
|
Director
|
|
March 16, 2018
|
Christopher Fralic
|
|
|
|
|
|
|
|
|
|
|
|
Director
|
|
March 16, 2018
|
Spencer Grimes
|
|
|
|
|
|
|
|
|
|
/s/Jim Parmalee
|
|
Director
|
|
March 16, 2018
|
Jim Parmalee
|
|
|
|
|
|
|
|
|
|
/s/Bedi Singh
|
|
Director
|
|
March 16, 2018
|
Bedi Singh
|
|
|
|
|
|
|
|
|
|
/s/Jason Whitt
|
|
Director
|
|
March 16, 2018
|
Jason Whitt
|
|
|
|
|
a.
|
BASE SALARY.
You will be paid a base salary of $337,000 per year, to be reviewed at least annually.
|
b.
|
BONUS.
You will be eligible for an annual bonus with a target of 50% of your base salary, payable upon achievement of goals to be set by the Compensation Committee; your bonus for 2017 will be pro-rated to your start date.
|
c.
|
EQUITY.
|
•
|
250,000 stock options (1/3 to vest on the first anniversary of your employment, and then monthly after that for the next two years).
|
•
|
150,000 RSAs (1/3 to vest on each anniversary of your employment).
|
•
|
Your stock options and RSAs will vest fully if you are terminated as a result of a change of control.
|
d.
|
SEVERANCE.
If you are terminated for a reason other than cause, or if you resign for good reason (both to be defined in your employment agreement), you will be paid one year of base salary.
|
e.
|
FRINGE BENEFITS.
You will be entitled to receive the fringe benefits generally available to our employees, including medical, dental, vision, disability insurance, life insurance, and a 401(k) match. You will be eligible for all benefits on the first of the month following your date of hire. We may amend, terminate, or enhance the benefits provided to you and our other employees from time to time as we deem appropriate.
|
f.
|
PAID TIME OFF.
You are entitled to 160 hours of vacation time and 80 hours of personal/sick days per year. Vacation is accrued monthly. All time off is prorated in your first year of employment. In addition, you will receive 10 paid holidays each calendar year or such other number as we may adopt, as well as a paid day off on your birthday.
|
g.
|
PARTICIPATION IN NEW DEAL TEAM POOL –
The total pool size is anticipated to be 10% of the target’s Stay Pool, minimum of 0.3% of the valuation of the Target with a cap of $500K; paid in one-year vest RSAs on same payout date as stay awards. You will participate in the Deal Team Pool along with other executives and at the discretion of the CEO.
|
/s/ Niklas Lindstrom
|
|
Niklas Lindstrom
|
|
Date: 2/13/17
|
|
Entity
|
Country
|
Quepasa.com de Mexico
|
Mexico
|
MeetMe Online Brasil S/S Ltda
|
Brazil
|
Skout, LLC
|
United States
|
If(we), Inc.
|
United States
|
Lovoo GmbH
|
Germany
|
TMG Holding Germany GmbH
|
Germany
|
/s/ RSM US LLP
|
|
Blue Bell, Pennsylvania
|
March 16, 2018
|
1.
|
I have reviewed this quarterly report on Form
10-K
of The Meet Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15I and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Geoffrey Cook
|
Geoffrey Cook
Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this quarterly report on Form
10-K
of The Meet Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ James Bugden
|
James Bugden
Chief Financial Officer
(Principal Financial Officer)
|
1.
|
The
annual
report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and
|
2.
|
The information contained in the
annual
report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Geoffrey Cook
|
Geoffrey Cook
|
Chief Executive Officer
|
(Principal Executive Officer)
|
1.
|
The
annual
report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and
|
2.
|
The information contained in the
annual
report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ James Bugden
|
James Bugen
|
Chief Financial Officer
|
(Principal Financial Officer)
|