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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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86-0879433
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(State or Other Jurisdiction of Incorporation or Organization)
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(I.R.S. Employer Identification No.)
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock
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MEET
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NASDAQ
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Securities registered pursuant to Section 12(g) of the Act: None
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Large accelerated filer ☐
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Accelerated filer ☒
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Non-accelerated filer ☐
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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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Strengthen the Core: Having transformed our business to a primarily user pay model, a key area of our focus is to strengthen the core social entertainment business we have built. This includes developing and delivering new video products, including Viewer Levels, Streamer Levels and NextDate, enhancing user experience and improving operational execution across our business. As we look ahead, we are focused on increasing authenticity and user safety through ramped-up user verification programs, as well as product improvements to core components like “Profile” and “Chat.” We will continue to gamify live-streaming with new features, contests and fresh content, including “Date Night,” which bridges the online experience of NextDate with real-world dating. We believe strengthening our core business will improve user monetization and grow revenue.
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•
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Expand into Adjacencies: Beyond our current user base, we see opportunities to leverage our social entertainment platform to expand into new user groups, adjacencies and niches, both organically and inorganically. We acquired and integrated four businesses in the 2016 to 2019 time frame, and have successfully brought Live to each acquired app, with the exception of the Growlr app, which we expect to do in 2020. We expect to enter new markets, including, for example, additional geographies, to build scale and create value. Additional opportunities include the development and delivery of stand-alone apps with a non-dating focus as well as geographic expansion.
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•
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Grow Margins: We will continue to focus on improving operating efficiencies and margins, while investing in growth from new products.
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•
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mobile apps 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 apps 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, TikTok, Azar, Younow, Bigo, Twitch and Periscope; and
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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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attract new users and retain existing users at a consistent rate;
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•
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compete for talent and attract and retain new content creators who will engage with users;
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•
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increase engagement by existing users;
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monetize our user base;
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•
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anticipate changes in the social networking, social discovery and social entertainment industries;
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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 products;
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•
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process, store and use data in compliance with governmental regulations and other legal obligations related to privacy;
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compete with other companies that are currently in, or may in the future enter, the social networking, social entertainment or social discovery industries;
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•
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hire, integrate and retain world class talent; and
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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, including our Live features, such as Viewer Levels, Streamers and NextDate, 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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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 apps;
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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 advertisements 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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adverse legal developments relating to advertising, including legislative and regulatory developments and developments in litigation;
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adverse media reports or other negative publicity involving us or other companies in our industry;
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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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changes made by device makers, operating systems or browsers that make it difficult or impossible for our advertising partners to identify the target audience of their advertisements on our mobile apps or websites;
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decisions about the amount and type of data we share with our advertising partners;
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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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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 advertisements 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 invalid traffic, click fraud or other invalid activity on advertisements, 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 a 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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the size and composition of our user base;
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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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our ability to monetize our services;
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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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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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Facebook discontinues or limits access to its platform by us and other app developers;
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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 app developers on the Facebook platform or shared by users;
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Facebook further develops its own competitive offering, Facebook Dating, or develops new competitive offerings; or
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Facebook disallows our advertising in its platforms.
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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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changes in consumer tastes and demands; and
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frequent introductions of new services or products that embody new technologies.
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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 local laws;
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lack of familiarity with local customs;
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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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•
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reduced protection for intellectual property rights in some countries; and
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difficulties in staffing and managing global operations and the increased travel and/or infrastructure.
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increase our number of users, which include users who purchase virtual items offered on Live, as well as the level of user engagement;
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develop and deploy diversified and distinguishable features and services for our users;
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develop or implement strategic initiatives to monetize Live;
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develop a reliable, scalable, secure, high-performance technology infrastructure that can efficiently handle increased usage;
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successfully compete with other companies, some of which have substantially greater resources and market power than us, that are currently in, or may in the future enter, our industry, or duplicate the features of our services; and
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defend ourselves against litigation, regulatory, intellectual property, privacy or other claims.
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changes in the number of our daily and monthly active users;
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changes in visits by our active users;
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•
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changes in our ability to attract, retain and compensate broadcasters in a competitive market;
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independent reports relating to the metrics of our mobile apps or website;
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our failure to generate increases in revenue;
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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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commercial relationships, joint ventures or capital commitments;
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the loss of significant business relationships;
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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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future acquisitions or combinations;
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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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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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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; and
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diversion of significant resources from the ongoing development of our existing operations.
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•
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we would not realize any or all of the potential benefits of the Merger, which could have a negative effect on our stock price;
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•
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under some circumstances, we may be required to pay a termination fee to Buyer of $18.6 million;
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•
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we will remain liable for significant transaction costs, including legal, accounting, financial advisory and other costs relating to the Merger regardless of whether the Merger is consummated;
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•
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the trading price of our common stock may decline to the extent that the current market price for our stock reflects a market assumption that the Merger will be completed;
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•
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the attention of our management and employees may have been diverted to the Merger rather than to our own operations and the pursuit of other opportunities that could have been beneficial to us;
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•
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we could be subject to litigation related to the Merger;
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•
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the potential loss of key personnel during the pendency of the Merger as employees and other service providers may experience uncertainty about their future roles with us following completion of the Merger; and
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•
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under the Merger Agreement, we are subject to certain restrictions on the conduct of our business prior to completing the Merger, which restrictions could adversely affect our ability to conduct our business as we otherwise would have done if we were not subject to these restrictions.
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(in thousands, except per share data)
Period
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Total Number of Shares Repurchased
(1) |
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Average Price Paid per Share
(2) |
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Total Number of Shares Purchased as Part of Publicly Announced Program
(1) |
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Approximate Dollar Value of Shares That May Yet Be Purchased Under the Program
(2) |
||||||
October 1-31, 2019
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1,191,883
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$
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4.19
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1,191,883
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$
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12,853
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November 1-30, 2019
|
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760,424
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$
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4.60
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760,424
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$
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9,354
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December 1-31, 2019
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339,995
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$
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4.96
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339,995
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$
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7,669
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Total
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2,292,302
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$
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4.44
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2,292,302
|
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$
|
7,669
|
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(1)
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The total number of shares purchased under the Share Repurchase Program is determined using trade dates for the related transactions.
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(2)
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The average price paid per share and approximate dollar value of shares that may yet be purchased under the Share Repurchase Program exclude fees, commissions and other charges for the related transactions.
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12/14
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12/15
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12/16
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12/17
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12/18
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12/19
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The Meet Group, Inc.
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$
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100.00
|
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$
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233.99
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$
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322.22
|
|
$
|
184.31
|
|
$
|
302.61
|
|
$
|
327.45
|
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Russell 2000 Index
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$
|
100.00
|
|
$
|
95.59
|
|
$
|
115.95
|
|
$
|
132.94
|
|
$
|
118.30
|
|
$
|
148.49
|
|
RDG Internet Composite Index
|
$
|
100.00
|
|
$
|
128.89
|
|
$
|
135.45
|
|
$
|
203.48
|
|
$
|
197.34
|
|
$
|
262.03
|
|
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For the Years Ended December 31,
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(in thousands, except per share data)
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2019
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2018
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2017
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2016
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2015
|
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Balance Sheets Data:
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Working capital
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$
|
23,626
|
|
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$
|
8,920
|
|
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$
|
8,015
|
|
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$
|
32,678
|
|
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$
|
29,214
|
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Total assets
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272,721
|
|
|
271,253
|
|
|
275,342
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|
|
209,489
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|
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111,491
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|||||
Current portion of finance lease obligations
|
10
|
|
|
134
|
|
|
254
|
|
|
221
|
|
|
366
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|||||
Current portion of long-term debt, net
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3,500
|
|
|
18,567
|
|
|
15,000
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|
|
—
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—
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|||||
Long-term finance lease obligations
|
53
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|
|
59
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|
|
192
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—
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|
|
221
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|
|||||
Long-term debt, net
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30,375
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|
|
18,088
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|
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40,637
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—
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—
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|||||
Total stockholders’ equity
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197,240
|
|
|
197,221
|
|
|
185,540
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|
|
195,089
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102,670
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Statements of Operations Data:
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Revenue
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$
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211,701
|
|
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$
|
178,613
|
|
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$
|
123,754
|
|
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$
|
76,124
|
|
|
$
|
56,904
|
|
Total operating costs and expenses
|
194,233
|
|
|
174,751
|
|
|
180,764
|
|
|
56,901
|
|
|
48,909
|
|
|||||
Income (loss) from operations
|
17,468
|
|
|
3,862
|
|
|
(57,010
|
)
|
|
19,223
|
|
|
7,995
|
|
|||||
Net income (loss)
|
11,334
|
|
|
1,143
|
|
|
(64,592
|
)
|
|
46,268
|
|
|
5,970
|
|
|||||
Basic and diluted net income (loss) per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic net income (loss) per share
|
$
|
0.15
|
|
|
$
|
0.02
|
|
|
$
|
(0.94
|
)
|
|
$
|
0.89
|
|
|
$
|
0.13
|
|
Diluted net income (loss) per share
|
$
|
0.15
|
|
|
$
|
0.02
|
|
|
$
|
(0.94
|
)
|
|
$
|
0.80
|
|
|
$
|
0.12
|
|
•
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liquidity;
|
•
|
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.
|
|
Average for the Quarter Ended
|
|||||||
|
December 31,
|
|||||||
(in thousands)
|
2019
|
|
2018
|
|
2017
|
|||
MAU
|
18,380
|
|
|
17,578
|
|
|
16,695
|
|
|
Average for the Quarter Ended
|
|||||||
|
December 31,
|
|||||||
(in thousands)
|
2019
|
|
2018
|
|
2017
|
|||
DAU
|
4,771
|
|
|
4,865
|
|
|
4,953
|
|
|
Average for the Quarter Ended
|
|||||||
|
December 31,
|
|||||||
(in thousands)
|
2019
|
|
2018
|
|
2017
|
|||
vDAU
|
843
|
|
|
916
|
|
|
299
|
|
•
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Revenue: Total revenue was $211.7 million for the year ended December 31, 2019, up 18.5% from $178.6 million for the year ended December 31, 2018.
|
•
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Net Income: Net income was $11.3 million for the year ended December 31, 2019.
|
•
|
Adjusted EBITDA: Adjusted EBITDA was $42.2 million for the year ended December 31, 2019. For the definition of Adjusted EBITDA, please refer to the heading “Non-GAAP Financial Measure” included in this MD&A.
|
•
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Cash and Cash Equivalents: Cash and Cash Equivalents totaled $27.2 million as of December 31, 2019.
|
•
|
Number of MAUs, DAUs and vDAUs: We believe our ability to grow web and mobile MAUs, DAUs and vDAUs 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, DAU or vDAU 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 purchases revenue we are able to earn.
|
•
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Advertising Rates: We believe our revenue and financial results are materially dependent on industry trends, and any changes to CPM could affect our revenue and financial results. In 2017, we experienced declining advertising rates, which negatively affected our revenue. In 2018, we saw some stabilization in advertising rates and a return to normal seasonality in advertising trends. In 2019, we saw continued stabilization in advertising rates and another year of typical seasonality. 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.
|
•
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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 advertisement 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.
|
•
|
Advertisement 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.
|
•
|
Apple App Store and Google Play Store: Our mobile apps are distributed through the Apple App Store and the Google Play Store. Our business will suffer if we are unable to maintain good relationships with Apple and Google, 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.
|
•
|
Seasonality: Historically, advertising spending has 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. In 2018 and 2019, we saw some stabilization in advertising rates and a return to normal seasonality in advertising trends. We believe 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 revenue between the fourth and subsequent first and second quarters each year. Growth trends in web and mobile MAUs, DAUs and vDAUs 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 and our expenses and capital expenditures.
|
•
|
Business Combinations: Acquisitions have been an important part of our growth strategy. In 2016 and 2017, we acquired three companies (Skout, if(we) and LOVOO), representing four significant brands for our portfolio (Skout, Tagged, Hi5 and LOVOO). In 2019, we acquired Initech and the Growlr app. Our ability to integrate acquired 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
|
|||||||||||
(in thousands)
|
2019
|
|
2018
|
|
($)
|
|
%
|
|||||||
Revenue
|
$
|
211,701
|
|
|
$
|
178,613
|
|
|
$
|
33,088
|
|
|
18.5
|
%
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
|||||||
Sales and marketing
|
34,332
|
|
|
32,086
|
|
|
2,246
|
|
|
7.0
|
%
|
|||
Product development and content
|
124,425
|
|
|
102,757
|
|
|
21,668
|
|
|
21.1
|
%
|
|||
General and administrative
|
21,931
|
|
|
21,094
|
|
|
837
|
|
|
4.0
|
%
|
|||
Depreciation and amortization
|
13,131
|
|
|
13,776
|
|
|
(645
|
)
|
|
(4.7
|
)%
|
|||
Acquisition, restructuring and other
|
414
|
|
|
5,038
|
|
|
(4,624
|
)
|
|
(91.8
|
)%
|
|||
Total operating costs and expenses
|
194,233
|
|
|
174,751
|
|
|
19,482
|
|
|
11.1
|
%
|
|||
Income from operations
|
17,468
|
|
|
3,862
|
|
|
13,606
|
|
|
352.3
|
%
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|||||||
Interest income
|
107
|
|
|
24
|
|
|
83
|
|
|
345.8
|
%
|
|||
Interest expense
|
(1,301
|
)
|
|
(2,322
|
)
|
|
1,021
|
|
|
(44.0
|
)%
|
|||
Gain (loss) on disposal of assets
|
41
|
|
|
(95
|
)
|
|
136
|
|
|
(143.2
|
)%
|
|||
(Loss) gain on foreign currency transactions
|
(51
|
)
|
|
97
|
|
|
(148
|
)
|
|
(152.6
|
)%
|
|||
Other items of (expense) income, net
|
(1
|
)
|
|
44
|
|
|
(45
|
)
|
|
(102.3
|
)%
|
|||
Total other expense
|
(1,205
|
)
|
|
(2,252
|
)
|
|
1,047
|
|
|
(46.5
|
)%
|
|||
Income before income tax expense
|
16,263
|
|
|
1,610
|
|
|
14,653
|
|
|
910.1
|
%
|
|||
Income tax expense
|
(4,929
|
)
|
|
(467
|
)
|
|
(4,462
|
)
|
|
955.5
|
%
|
|||
Net income
|
$
|
11,334
|
|
|
$
|
1,143
|
|
|
$
|
10,191
|
|
|
891.6
|
%
|
|
Year Ended December 31,
|
||||||||||||
|
2019
|
|
2018
|
||||||||||
(in thousands)
|
$
|
|
%
|
|
$
|
|
%
|
||||||
User pay revenue:
|
|
|
|
|
|
|
|
||||||
Video
|
$
|
84,113
|
|
|
39.7
|
%
|
|
$
|
39,282
|
|
|
22.0
|
%
|
Subscription and other in-app products
|
61,683
|
|
|
29.2
|
%
|
|
68,048
|
|
|
38.1
|
%
|
||
Total user pay revenue
|
145,796
|
|
|
68.9
|
%
|
|
107,330
|
|
|
60.1
|
%
|
||
Advertising
|
65,905
|
|
|
31.1
|
%
|
|
71,283
|
|
|
39.9
|
%
|
||
Total revenue
|
$
|
211,701
|
|
|
100.0
|
%
|
|
$
|
178,613
|
|
|
100.0
|
%
|
•
|
Sales and Marketing: Sales and marketing expenses increased $2.2 million (or 7.0%) to $34.3 million for the year ended December 31, 2019, compared with sales and marketing expenses of $32.1 million for the year ended December 31, 2018. The increase in sales and marketing expenses for the year ended December 31, 2019 was primarily attributable to $2.1 million of increased advertising expense to attract more users to our apps.
|
•
|
Product Development and Content: Product development and content expenses increased $21.7 million (or 21.1%) to $124.4 million for the year ended December 31, 2019, compared with product development and content expenses of $102.8 million for the year ended December 31, 2018. The increase in product development and content expenses for the year ended December 31, 2019 was primarily attributable to: an increase in variable mobile content expense of $24.3 million due to increased revenue from Live, which was partially offset by a reduction for broadcaster rewards-breakage (a contra expense) of $4.4 million; $1.7 million in increased stock-based compensation expense; $0.7 million in increased technical operations expense; $1.1 million in increased consulting expense; and $1.3 million in increased safety and moderation expense. These increases were partially offset by a $3.5 million decrease in Social Theater expenses.
|
•
|
General and Administrative: General and administrative expenses increased $0.8 million (or 4.0%) to $21.9 million for the year ended December 31, 2019, compared with general and administrative expenses of $21.1 million for the year ended December 31, 2018. The increase in general and administrative expenses for the year ended December 31, 2019 was primarily attributable to increases in bad debt expense of $1.3 million and stock-based compensation expense of $0.6 million. These increases were partially offset by decreases in office-related expense of $0.3 million, employee-related expense of $0.1 million, professional fees expense of $0.2 million and other general and administrative expense of $0.5 million.
|
•
|
Depreciation and Amortization: Depreciation and amortization expense decreased $0.6 million (or 4.7%) to $13.1 million for the year ended December 31, 2019, compared with depreciation and amortization expense of $13.8 million for the year ended December 31, 2018. The decrease in depreciation and amortization expense for the year ended December 31, 2019 was primarily attributable to lower amortization of the intangible assets recognized in our acquisitions of if(we) and LOVOO, which was partially offset by the amortization of the intangible assets recognized in our acquisition of Initech.
|
•
|
Acquisition, Restructuring and Other: Acquisition, restructuring and other expenses decreased $4.6 million (or 91.8%) to $0.4 million for the year ended December 31, 2019, compared with acquisition, restructuring and other expenses of $5.0 million for the year ended December 31, 2018. Acquisition, restructuring and other expenses included transaction costs, including legal and diligence costs for acquisitions and other non-recurring transactions, the accrual of the exit costs of non-cancellable leases, employee-related restructuring costs and employee exit and relocation costs. The decrease in acquisition, restructuring and other expenses for the year ended December 31, 2019 was primarily attributable to a decrease in employee exit costs of $3.5 million, and the current period non-recurring gain for a change in the fair value of the contingent consideration liability for the Initech Acquisition of $0.9 million.
|
|
Year Ended December 31,
|
|
Change From Prior Year
|
|||||||||||
(in thousands)
|
2018
|
|
2017
|
|
($)
|
|
%
|
|||||||
Revenue
|
$
|
178,613
|
|
|
$
|
123,754
|
|
|
$
|
54,859
|
|
|
44.3
|
%
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
|||||||
Sales and marketing
|
32,086
|
|
|
20,356
|
|
|
11,730
|
|
|
57.6
|
%
|
|||
Product development and content
|
102,757
|
|
|
60,704
|
|
|
42,053
|
|
|
69.3
|
%
|
|||
General and administrative
|
21,094
|
|
|
19,550
|
|
|
1,544
|
|
|
7.9
|
%
|
|||
Depreciation and amortization
|
13,776
|
|
|
11,574
|
|
|
2,202
|
|
|
19.0
|
%
|
|||
Acquisition, restructuring and other
|
5,038
|
|
|
12,151
|
|
|
(7,113
|
)
|
|
(58.5
|
)%
|
|||
Goodwill impairment
|
—
|
|
|
56,429
|
|
|
(56,429
|
)
|
|
(100.0
|
)%
|
|||
Total operating costs and expenses
|
174,751
|
|
|
180,764
|
|
|
(6,013
|
)
|
|
(3.3
|
)%
|
|||
Income (loss) from operations
|
3,862
|
|
|
(57,010
|
)
|
|
60,872
|
|
|
(106.8
|
)%
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|||||||
Interest income
|
24
|
|
|
6
|
|
|
18
|
|
|
300.0
|
%
|
|||
Interest expense
|
(2,322
|
)
|
|
(860
|
)
|
|
(1,462
|
)
|
|
170.0
|
%
|
|||
Loss on disposal of assets
|
(95
|
)
|
|
—
|
|
|
(95
|
)
|
|
(100.0
|
)%
|
|||
Gain (loss) on foreign currency transactions
|
97
|
|
|
(33
|
)
|
|
130
|
|
|
(393.9
|
)%
|
|||
Other items of income, net
|
44
|
|
|
9
|
|
|
35
|
|
|
388.9
|
%
|
|||
Total other expense
|
(2,252
|
)
|
|
(878
|
)
|
|
(1,374
|
)
|
|
156.5
|
%
|
|||
Income (loss) before income tax expense
|
1,610
|
|
|
(57,888
|
)
|
|
59,498
|
|
|
(102.8
|
)%
|
|||
Income tax expense
|
(467
|
)
|
|
(6,704
|
)
|
|
6,237
|
|
|
(93.0
|
)%
|
|||
Net income (loss)
|
$
|
1,143
|
|
|
$
|
(64,592
|
)
|
|
$
|
65,735
|
|
|
(101.8
|
)%
|
|
Year Ended December 31,
|
||||||||||||
|
2018
|
|
2017(1)
|
||||||||||
(in thousands)
|
$
|
|
%
|
|
$
|
|
%
|
||||||
User pay revenue:
|
|
|
|
|
|
|
|
||||||
Video
|
$
|
39,282
|
|
|
22.0
|
%
|
|
$
|
1,927
|
|
|
1.6
|
%
|
Subscription and other in-app products
|
68,048
|
|
|
38.1
|
%
|
|
31,865
|
|
|
25.7
|
%
|
||
Total user pay revenue
|
107,330
|
|
|
60.1
|
%
|
|
33,792
|
|
|
27.3
|
%
|
||
Advertising
|
71,283
|
|
|
39.9
|
%
|
|
89,962
|
|
|
72.7
|
%
|
||
Total revenue
|
$
|
178,613
|
|
|
100.0
|
%
|
|
$
|
123,754
|
|
|
100.0
|
%
|
•
|
Sales and Marketing: Sales and marketing expenses increased $11.7 million (or 57.6%) to $32.1 million for the year ended December 31, 2018, compared with sales and marketing expenses of $20.4 million for the year ended December 31, 2017. The increase in sales and marketing expenses for the year ended December 31, 2018, which included a full year of sales and marketing expenses for if(we) and LOVOO, was primarily attributable to $9.7 million of increased advertising expense to attract more users to our apps, $1.1 million of increased employee-related expense and $0.5 million of increased stock-based compensation expense. The increases in employee-related expense and stock-based compensation expense were primarily attributable to the if(we) and LOVOO acquisitions.
|
•
|
Product Development and Content: Product development and content expenses increased $42.1 million (or 69.3%) to $102.8 million for the year ended December 31, 2018, compared with product development and content expenses of $60.7 million for the year ended December 31, 2017. The increase in product development and content expenses for the year ended December 31, 2018, which included a full year of product development and content expenses for if(we) and LOVOO, was primarily attributable to an increase in variable mobile content expense of $33.6 million, $3.1 million of increased professional fees expense, $2.0 million of increased employee-related expense, $1.4 million of increased data center and technical operations expense, $0.8 million of increased safety and moderation expense and $0.8 million of increased stock-based compensation expense. The increase in variable mobile content expense was primarily attributable to the if(we) and LOVOO acquisitions, as well as the increased adoption and/or launch of Live on our apps. The increases in employee-related expense, data center and technical operations expense and stock-based compensation expense were primarily attributable to the if(we) and LOVOO acquisitions.
|
•
|
General and Administrative: General and administrative expenses increased $1.6 million (or 7.9%) to $21.1 million for the year ended December 31, 2018, compared with general and administrative expenses of $19.5 million for the year ended December 31, 2017. The increase in general and administrative expenses for the year ended December 31, 2018, which included a full year of general and administrative expenses for if(we) and LOVOO, was primarily attributable to an increase in employee-related expense of $1.5 million. The increase was primarily attributable to the LOVOO acquisition.
|
•
|
Depreciation and Amortization: Depreciation and amortization expense increased $2.2 million (or 19.0%) to $13.8 million for the year ended December 31, 2018, compared with depreciation and amortization expense of $11.6 million for the year ended December 31, 2017. The increase in depreciation and amortization expense for the year ended December 31, 2018 was primarily attributable to the amortization of intangible assets recognized in the if(we) and LOVOO acquisitions.
|
•
|
Acquisition, Restructuring and Other: Acquisition, restructuring and other expenses decreased $7.2 million (or 58.5%) to $5.0 million for the year ended December 31, 2018, compared with acquisition, restructuring and other expenses of $12.2 million for the year ended December 31, 2017. Acquisition, restructuring and other expenses included employee retention bonuses in connection with our acquisitions, transaction costs, including legal and diligence costs for acquisitions, employee-related restructuring costs, the accrual of the exit costs of non-cancellable leases and employee exit and relocation costs. The decrease in acquisition, restructuring and other expenses for the year ended December 31, 2018 was primarily attributable due to our acquisitions in 2017, which were not repeated in 2018.
|
•
|
Goodwill Impairment: In the fourth quarter of 2017, we determined a $56.4 million one-time, non-cash impairment charge was required for our U.S. reporting unit, due predominantly to the market-driven impacts on advertising revenue resulting from lower CPMs, which negatively affected our results and outlook. We believe this non-cash impairment charge does not impact our ability to generate cash flow in the future, and it is not tax deductible.
|
|
For the Years Ended December 31,
|
|
2019 to 2018
|
|
2018 to 2017
|
||||||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2017
|
|
Changes ($)
|
|
Changes ($)
|
||||||||||
Sales and marketing
|
$
|
412
|
|
|
$
|
904
|
|
|
$
|
440
|
|
|
$
|
(492
|
)
|
|
$
|
464
|
|
Product development and content
|
6,495
|
|
|
4,768
|
|
|
4,008
|
|
|
1,727
|
|
|
760
|
|
|||||
General and administrative
|
4,200
|
|
|
3,614
|
|
|
4,019
|
|
|
586
|
|
|
(405
|
)
|
|||||
Total stock-based compensation expense
|
$
|
11,107
|
|
|
$
|
9,286
|
|
|
$
|
8,467
|
|
|
$
|
1,821
|
|
|
$
|
819
|
|
(in thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Stock options
|
$
|
1,389
|
|
|
$
|
2,097
|
|
|
$
|
3,377
|
|
RSAs
|
8,428
|
|
|
6,560
|
|
|
5,090
|
|
|||
PSUs
|
1,290
|
|
|
629
|
|
|
—
|
|
|||
Total stock-based compensation expense
|
$
|
11,107
|
|
|
$
|
9,286
|
|
|
$
|
8,467
|
|
(in thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Net cash provided by operating activities
|
$
|
37,616
|
|
|
$
|
28,597
|
|
|
$
|
31,273
|
|
Net cash used in investing activities
|
(13,323
|
)
|
|
(2,507
|
)
|
|
(128,004
|
)
|
|||
Net cash (used in) provided by financing activities
|
(25,314
|
)
|
|
(22,409
|
)
|
|
99,922
|
|
|||
Change in cash and cash equivalents prior to effect of foreign currency exchange rate
|
$
|
(1,021
|
)
|
|
$
|
3,681
|
|
|
$
|
3,191
|
|
(in thousands)
|
2019
|
|
2018
|
||||
Cash and cash equivalents
|
$
|
27,241
|
|
|
$
|
28,366
|
|
Total assets
|
$
|
272,721
|
|
|
$
|
271,253
|
|
Percentage of total assets
|
10.0
|
%
|
|
10.5
|
%
|
(in thousands)
|
Total
|
|
Less Than 1
Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More Than 5
Years
|
||||||||||
Operating leases(1)
|
$
|
7,930
|
|
|
$
|
2,361
|
|
|
$
|
3,436
|
|
|
$
|
1,019
|
|
|
$
|
1,114
|
|
Finance leases(2)
|
72
|
|
|
12
|
|
|
24
|
|
|
24
|
|
|
12
|
|
|||||
Cloud data storage(3)
|
14,320
|
|
|
5,248
|
|
|
7,925
|
|
|
1,147
|
|
|
—
|
|
|||||
Term loan facility
|
37,121
|
|
|
4,738
|
|
|
32,383
|
|
|
—
|
|
|
—
|
|
|||||
Interest on term loan facility(4)
|
2,996
|
|
|
1,238
|
|
|
1,758
|
|
|
—
|
|
|
—
|
|
|||||
Total contractual obligations
|
$
|
62,439
|
|
|
$
|
13,597
|
|
|
$
|
45,526
|
|
|
$
|
2,190
|
|
|
$
|
1,126
|
|
(1)
|
The operating lease obligations relate to facilities and equipment we lease in the U.S. and Germany.
|
(2)
|
The finance lease obligations relate to office equipment we lease in Germany.
|
(3)
|
The cloud data storage obligations relate to Amazon Web Services and Google Cloud costs.
|
(4)
|
Includes principal and projected interest using our weighted average interest rate of 3.76% as of December 31, 2019.
|
|
Year Ended December 31,
|
||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Net income (loss)
|
$
|
11,334
|
|
|
$
|
1,143
|
|
|
$
|
(64,592
|
)
|
Interest expense
|
1,301
|
|
|
2,322
|
|
|
860
|
|
|||
Income tax expense
|
4,929
|
|
|
467
|
|
|
6,704
|
|
|||
Depreciation and amortization expense
|
13,131
|
|
|
13,776
|
|
|
11,574
|
|
|||
Stock-based compensation expense
|
11,107
|
|
|
9,286
|
|
|
8,467
|
|
|||
Goodwill impairment
|
—
|
|
|
—
|
|
|
56,429
|
|
|||
Acquisition, restructuring and other
|
414
|
|
|
5,038
|
|
|
12,151
|
|
|||
(Gain) loss on disposal of assets
|
(41
|
)
|
|
95
|
|
|
—
|
|
|||
Loss (gain) on foreign currency transactions
|
51
|
|
|
(97
|
)
|
|
33
|
|
|||
Adjusted EBITDA
|
$
|
42,226
|
|
|
$
|
32,030
|
|
|
$
|
31,626
|
|
|
Page
|
|
|
Reports of Independent Registered Public Accounting Firm
|
|
|
|
Consolidated Balance Sheets as of December 31, 2019 and 2018
|
|
|
|
Consolidated Statements of Operations and Comprehensive Income (Loss) for the Years Ended December 31, 2019, 2018 and 2017
|
|
|
|
Consolidated Statements of Changes in Stockholders' Equity for the Years Ended December 31, 2019, 2018 and 2017
|
|
|
|
Consolidated Statements of Cash Flows for the Years Ended December 31, 2019, 2018 and 2017
|
|
|
|
Notes to Consolidated Financial Statements
|
|
2019
|
|
2018
|
||||
Assets:
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
27,241
|
|
|
$
|
28,366
|
|
Accounts receivable, net of allowance for bad debts of $269 and $384 as of December 31, 2019 and 2018, respectively
|
25,234
|
|
|
27,148
|
|
||
Prepaid expenses and other current assets
|
6,062
|
|
|
4,911
|
|
||
Total current assets
|
58,537
|
|
|
60,425
|
|
||
Deferred tax assets
|
16,233
|
|
|
19,049
|
|
||
Property and equipment, net
|
3,625
|
|
|
4,634
|
|
||
Operating lease right-of-use assets
|
7,034
|
|
|
—
|
|
||
Intangible assets, net
|
29,305
|
|
|
36,558
|
|
||
Goodwill
|
156,687
|
|
|
148,133
|
|
||
Other assets
|
1,300
|
|
|
2,454
|
|
||
Total assets
|
$
|
272,721
|
|
|
$
|
271,253
|
|
Liabilities and stockholders' equity:
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
5,346
|
|
|
$
|
9,071
|
|
Accrued liabilities
|
20,090
|
|
|
19,112
|
|
||
Current portion of long-term debt, net
|
3,500
|
|
|
18,567
|
|
||
Current portion of operating lease liabilities
|
2,081
|
|
|
—
|
|
||
Current portion of finance lease obligations
|
10
|
|
|
134
|
|
||
Deferred revenue
|
3,884
|
|
|
4,621
|
|
||
Total current liabilities
|
34,911
|
|
|
51,505
|
|
||
Long-term debt, net
|
30,375
|
|
|
18,088
|
|
||
Long-term operating lease liabilities
|
5,024
|
|
|
—
|
|
||
Long-term finance lease obligations
|
53
|
|
|
59
|
|
||
Long-term derivative liabilities
|
1,451
|
|
|
940
|
|
||
Deferred tax liabilities
|
2,773
|
|
|
3,400
|
|
||
Other liabilities
|
894
|
|
|
40
|
|
||
Total liabilities
|
75,481
|
|
|
74,032
|
|
||
Commitments and contingencies
|
|
|
|
|
|
||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $0.001 par value; authorized - 5,000,000 shares; no shares issued and outstanding as of December 31, 2019 and 2018
|
—
|
|
|
—
|
|
||
Series A junior participating preferred stock, $0.001 par value; authorized - 200,000 shares; no shares issued and outstanding as of December 31, 2019 and 2018
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value; authorized - 100,000,000 shares; 70,756,013 and 74,697,526 shares issued and outstanding as of December 31, 2019 and 2018, respectively
|
71
|
|
|
75
|
|
||
Additional paid-in capital
|
430,959
|
|
|
419,456
|
|
||
Accumulated deficit
|
(231,441
|
)
|
|
(220,276
|
)
|
||
Accumulated other comprehensive loss
|
(2,349
|
)
|
|
(2,034
|
)
|
||
Total stockholders’ equity
|
197,240
|
|
|
197,221
|
|
||
Total liabilities and stockholders’ equity
|
$
|
272,721
|
|
|
$
|
271,253
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenue
|
$
|
211,701
|
|
|
$
|
178,613
|
|
|
$
|
123,754
|
|
Operating costs and expenses:
|
|
|
|
|
|
||||||
Sales and marketing
|
34,332
|
|
|
32,086
|
|
|
20,356
|
|
|||
Product development and content
|
124,425
|
|
|
102,757
|
|
|
60,704
|
|
|||
General and administrative
|
21,931
|
|
|
21,094
|
|
|
19,550
|
|
|||
Depreciation and amortization
|
13,131
|
|
|
13,776
|
|
|
11,574
|
|
|||
Acquisition, restructuring and other
|
414
|
|
|
5,038
|
|
|
12,151
|
|
|||
Goodwill impairment
|
—
|
|
|
—
|
|
|
56,429
|
|
|||
Total operating costs and expenses
|
194,233
|
|
|
174,751
|
|
|
180,764
|
|
|||
Income (loss) from operations
|
17,468
|
|
|
3,862
|
|
|
(57,010
|
)
|
|||
Other income (expense):
|
|
|
|
|
|
||||||
Interest income
|
107
|
|
|
24
|
|
|
6
|
|
|||
Interest expense
|
(1,301
|
)
|
|
(2,322
|
)
|
|
(860
|
)
|
|||
Gain (loss) on disposal of assets
|
41
|
|
|
(95
|
)
|
|
—
|
|
|||
(Loss) gain on foreign currency transactions
|
(51
|
)
|
|
97
|
|
|
(33
|
)
|
|||
Other items of (expense) income, net
|
(1
|
)
|
|
44
|
|
|
9
|
|
|||
Total other expense
|
(1,205
|
)
|
|
(2,252
|
)
|
|
(878
|
)
|
|||
Income (loss) before income tax expense
|
16,263
|
|
|
1,610
|
|
|
(57,888
|
)
|
|||
Income tax expense
|
(4,929
|
)
|
|
(467
|
)
|
|
(6,704
|
)
|
|||
Net income (loss)
|
$
|
11,334
|
|
|
$
|
1,143
|
|
|
$
|
(64,592
|
)
|
|
|
|
|
|
|
||||||
Basic and diluted net income (loss) per share:
|
|
|
|
|
|
||||||
Basic net income (loss) per share
|
$
|
0.15
|
|
|
$
|
0.02
|
|
|
$
|
(0.94
|
)
|
Diluted net income (loss) per share
|
$
|
0.15
|
|
|
$
|
0.02
|
|
|
$
|
(0.94
|
)
|
|
|
|
|
|
|
||||||
Weighted-average shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
74,118,035
|
|
|
73,085,542
|
|
|
68,743,956
|
|
|||
Diluted
|
76,921,420
|
|
|
75,616,439
|
|
|
68,743,956
|
|
|||
|
|
|
|
|
|
||||||
Comprehensive income (loss):
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
11,334
|
|
|
$
|
1,143
|
|
|
$
|
(64,592
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||
Reclassification of (gain) loss on derivative financial instruments, net of tax of $505, $924 and $548, respectively
|
(1,125
|
)
|
|
(2,059
|
)
|
|
1,566
|
|
|||
Unrealized gain (loss) on derivative financial instruments, net of tax of $563, $999 and $851, respectively
|
1,197
|
|
|
2,088
|
|
|
(2,303
|
)
|
|||
Foreign currency translation adjustment
|
(387
|
)
|
|
(938
|
)
|
|
(388
|
)
|
|||
Other comprehensive loss
|
(315
|
)
|
|
(909
|
)
|
|
(1,125
|
)
|
|||
Comprehensive income (loss)
|
$
|
11,019
|
|
|
$
|
234
|
|
|
$
|
(65,717
|
)
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
Total Stockholders’ Equity
|
|||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balance — December 31, 2016
|
58,945,607
|
|
|
$
|
59
|
|
|
$
|
351,873
|
|
|
$
|
(156,843
|
)
|
|
$
|
—
|
|
|
$
|
195,089
|
|
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
8,467
|
|
|
—
|
|
|
—
|
|
|
8,467
|
|
|||||
Exercise of stock options
|
2,080,648
|
|
|
2
|
|
|
2,815
|
|
|
—
|
|
|
—
|
|
|
2,817
|
|
|||||
Exercise of warrants
|
675,000
|
|
|
1
|
|
|
2,396
|
|
|
—
|
|
|
—
|
|
|
2,397
|
|
|||||
Issuance of common stock
|
9,200,000
|
|
|
9
|
|
|
42,986
|
|
|
—
|
|
|
—
|
|
|
42,995
|
|
|||||
Issuance of common stock for vested restricted stock awards
|
1,013,763
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Restricted stock awards withheld to cover taxes
|
—
|
|
|
—
|
|
|
(507
|
)
|
|
—
|
|
|
—
|
|
|
(507
|
)
|
|||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,125
|
)
|
|
(1,125
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(64,592
|
)
|
|
—
|
|
|
(64,592
|
)
|
|||||
Balance — December 31, 2017
|
71,915,018
|
|
|
72
|
|
|
408,029
|
|
|
(221,435
|
)
|
|
(1,125
|
)
|
|
185,541
|
|
|||||
Adoption of Accounting Standards Codification Topic 606
|
—
|
|
|
—
|
|
|
—
|
|
|
16
|
|
|
—
|
|
|
16
|
|
|||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
9,286
|
|
|
—
|
|
|
—
|
|
|
9,286
|
|
|||||
Exercise of stock options
|
1,079,496
|
|
|
2
|
|
|
2,562
|
|
|
—
|
|
|
—
|
|
|
2,564
|
|
|||||
Issuance of common stock for vested restricted stock awards
|
1,591,662
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Issuance of common stock for vested performance share units
|
111,350
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Restricted stock awards withheld to cover taxes
|
—
|
|
|
—
|
|
|
(420
|
)
|
|
—
|
|
|
—
|
|
|
(420
|
)
|
|||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(909
|
)
|
|
(909
|
)
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,143
|
|
|
—
|
|
|
1,143
|
|
|||||
Balance — December 31, 2018
|
74,697,526
|
|
|
75
|
|
|
419,456
|
|
|
(220,276
|
)
|
|
(2,034
|
)
|
|
197,221
|
|
|||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
11,107
|
|
|
—
|
|
|
—
|
|
|
11,107
|
|
|||||
Exercise of stock options
|
179,914
|
|
|
—
|
|
|
770
|
|
|
—
|
|
|
—
|
|
|
770
|
|
|||||
Issuance of common stock for vested restricted stock awards
|
1,616,142
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Restricted stock awards withheld to cover taxes
|
—
|
|
|
—
|
|
|
(372
|
)
|
|
—
|
|
|
—
|
|
|
(372
|
)
|
|||||
Repurchase and retirement of common stock
|
(5,737,569
|
)
|
|
(6
|
)
|
|
—
|
|
|
(22,499
|
)
|
|
—
|
|
|
(22,505
|
)
|
|||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(315
|
)
|
|
(315
|
)
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
11,334
|
|
|
—
|
|
|
11,334
|
|
|||||
Balance — December 31, 2019
|
70,756,013
|
|
|
$
|
71
|
|
|
$
|
430,959
|
|
|
$
|
(231,441
|
)
|
|
$
|
(2,349
|
)
|
|
$
|
197,240
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
11,334
|
|
|
$
|
1,143
|
|
|
$
|
(64,592
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
13,131
|
|
|
13,776
|
|
|
11,574
|
|
|||
Amortization of right-of-use assets
|
2,567
|
|
|
—
|
|
|
—
|
|
|||
Goodwill impairment
|
—
|
|
|
—
|
|
|
56,429
|
|
|||
Stock-based compensation expense
|
11,107
|
|
|
9,286
|
|
|
8,467
|
|
|||
Deferred tax expense (benefit)
|
2,213
|
|
|
(130
|
)
|
|
6,928
|
|
|||
(Gain) loss on disposal of assets
|
(41
|
)
|
|
95
|
|
|
—
|
|
|||
Loss (gain) on foreign currency transactions
|
51
|
|
|
(97
|
)
|
|
2
|
|
|||
Bad debt expense
|
1,884
|
|
|
598
|
|
|
263
|
|
|||
Non-cash interest expense
|
323
|
|
|
327
|
|
|
193
|
|
|||
Changes in derivative financial instruments
|
—
|
|
|
28
|
|
|
—
|
|
|||
Changes in contingent consideration obligations
|
1,059
|
|
|
—
|
|
|
103
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
489
|
|
|
(1,519
|
)
|
|
3,738
|
|
|||
Prepaid expenses, other current assets and other assets
|
1,378
|
|
|
(2,773
|
)
|
|
4,735
|
|
|||
Accounts payable and accrued liabilities
|
(7,114
|
)
|
|
7,495
|
|
|
1,881
|
|
|||
Deferred revenue
|
(765
|
)
|
|
368
|
|
|
1,552
|
|
|||
Net cash provided by operating activities
|
37,616
|
|
|
28,597
|
|
|
31,273
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Purchases of property and equipment
|
(1,515
|
)
|
|
(2,507
|
)
|
|
(1,798
|
)
|
|||
Acquisitions of businesses, net of cash acquired
|
(11,808
|
)
|
|
—
|
|
|
(126,206
|
)
|
|||
Net cash used in investing activities
|
(13,323
|
)
|
|
(2,507
|
)
|
|
(128,004
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from exercise of stock options
|
770
|
|
|
2,562
|
|
|
2,815
|
|
|||
Proceeds from issuance of common stock
|
—
|
|
|
—
|
|
|
42,995
|
|
|||
Proceeds from exercise of warrants
|
—
|
|
|
—
|
|
|
2,396
|
|
|||
Repurchases of common stock
|
(22,505
|
)
|
|
—
|
|
|
—
|
|
|||
Payments of finance leases
|
(191
|
)
|
|
(241
|
)
|
|
(324
|
)
|
|||
Proceeds from revolving loan
|
7,000
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from term loan, net
|
34,907
|
|
|
—
|
|
|
75,000
|
|
|||
Payments for restricted stock awards withheld for taxes
|
(372
|
)
|
|
(420
|
)
|
|
(507
|
)
|
|||
Payments of loan origination costs
|
(108
|
)
|
|
—
|
|
|
(806
|
)
|
|||
Payments of revolving loan
|
(7,000
|
)
|
|
—
|
|
|
—
|
|
|||
Payments of contingent consideration
|
—
|
|
|
(5,000
|
)
|
|
(2,897
|
)
|
|||
Payments of term loan
|
(37,815
|
)
|
|
(19,310
|
)
|
|
(18,750
|
)
|
|||
Net cash (used in) provided by financing activities
|
(25,314
|
)
|
|
(22,409
|
)
|
|
99,922
|
|
|||
Change in cash and cash equivalents prior to effect of foreign currency exchange rate
|
(1,021
|
)
|
|
3,681
|
|
|
3,191
|
|
|||
Effect of foreign currency exchange rate
|
(104
|
)
|
|
(368
|
)
|
|
(384
|
)
|
|||
Net (decrease) increase in cash and cash equivalents
|
(1,125
|
)
|
|
3,313
|
|
|
2,807
|
|
|||
Cash and cash equivalents at beginning of period
|
28,366
|
|
|
25,053
|
|
|
22,246
|
|
|||
Cash and cash equivalents at end of period
|
$
|
27,241
|
|
|
$
|
28,366
|
|
|
$
|
25,053
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
1,027
|
|
|
$
|
1,971
|
|
|
$
|
645
|
|
Cash paid for income taxes
|
$
|
2,723
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(in thousands)
|
Balance at
Beginning of
Period
|
|
Additions,
Costs and
Expenses
|
|
Deductions,
Write-offs
|
|
Balance at
End of the
Period
|
||||||||
Allowance for Bad Debts:
|
|
|
|
|
|
|
|
||||||||
Year Ended December 31, 2019
|
$
|
384
|
|
|
$
|
1,800
|
|
|
$
|
(1,915
|
)
|
|
$
|
269
|
|
Year Ended December 31, 2018
|
$
|
528
|
|
|
$
|
194
|
|
|
$
|
(338
|
)
|
|
$
|
384
|
|
Year Ended December 31, 2017
|
$
|
283
|
|
|
$
|
304
|
|
|
$
|
(59
|
)
|
|
$
|
528
|
|
|
Years
|
||||
Servers, computer equipment and software
|
1
|
|
to
|
|
3
|
Office furniture and equipment
|
3
|
|
to
|
|
5
|
Leasehold improvements
|
1
|
|
to
|
|
10
|
|
Years
|
||||
Trademarks
|
5
|
|
to
|
|
10
|
Domain names
|
5
|
|
to
|
|
10
|
Software
|
1
|
|
to
|
|
5
|
Customer relationships
|
1
|
|
to
|
|
10
|
•
|
Level 1: Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.
|
•
|
Level 2: Valuations based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and models for which all significant inputs are observable, either directly or indirectly.
|
•
|
Level 3: Valuations based on inputs that are unobservable and significant to the overall fair value measurement.
|
(in thousands)
|
March 5, 2019
|
||
Cash consideration (1)
|
$
|
11,808
|
|
Contingent consideration
|
1,718
|
|
|
Total consideration
|
$
|
13,526
|
|
(1)
|
Cash consideration includes a $1.0 million escrow payment to be paid out 18 months from the acquisition date.
|
(in thousands)
|
March 5, 2019
|
||
Accounts receivable
|
$
|
545
|
|
Intangible assets
|
3,480
|
|
|
Accrued expenses and other current liabilities
|
(10
|
)
|
|
Deferred revenue
|
(102
|
)
|
|
Net assets acquired
|
3,913
|
|
|
Goodwill
|
9,613
|
|
|
Total consideration
|
$
|
13,526
|
|
(in thousands)
|
Fair Value
|
|
Weighted-average
Amortization Period (Years) |
||
Trademarks
|
$
|
1,200
|
|
|
10.0
|
Software
|
865
|
|
|
3.0
|
|
Customer relationships
|
1,415
|
|
|
3.6
|
|
Total identifiable intangible assets
|
$
|
3,480
|
|
|
5.7
|
(in thousands, except per share data)
|
2019
|
|
2018
|
||||
Revenue
|
$
|
213,175
|
|
|
$
|
183,475
|
|
Net income
|
$
|
12,057
|
|
|
$
|
2,380
|
|
Basic net income per share
|
$
|
0.16
|
|
|
$
|
0.03
|
|
Diluted net income per share
|
$
|
0.16
|
|
|
$
|
0.03
|
|
(in thousands)
|
Contingent
Consideration
|
||
Balance as of March 5, 2019
|
$
|
—
|
|
Amounts acquired
|
1,718
|
|
|
Accretion
|
159
|
|
|
Fair value adjustment
|
(983
|
)
|
|
Balance as of December 31, 2019
|
$
|
894
|
|
(in thousands)
|
2019
|
|
2018
|
||||
Value-added tax and income tax receivables
|
$
|
1,312
|
|
|
$
|
645
|
|
Fair value of derivative assets
|
583
|
|
|
919
|
|
||
Prepaid insurance
|
659
|
|
|
651
|
|
||
Prepaid support contracts
|
443
|
|
|
547
|
|
||
Prepaid service providers
|
1,765
|
|
|
1,638
|
|
||
Prepaid advertising
|
680
|
|
|
102
|
|
||
Other prepaid expenses and other current assets
|
620
|
|
|
409
|
|
||
Total prepaid expenses and other current assets
|
$
|
6,062
|
|
|
$
|
4,911
|
|
(in thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
U.S. federal:
|
|
|
|
|
|
||||||
Current
|
$
|
—
|
|
|
$
|
82
|
|
|
$
|
(21
|
)
|
Deferred
|
(1,967
|
)
|
|
(473
|
)
|
|
(6,637
|
)
|
|||
Total U.S. federal
|
(1,967
|
)
|
|
(391
|
)
|
|
(6,658
|
)
|
|||
U.S. state:
|
|
|
|
|
|
||||||
Current
|
(121
|
)
|
|
(47
|
)
|
|
32
|
|
|||
Deferred
|
(895
|
)
|
|
1,223
|
|
|
74
|
|
|||
Total U.S. state
|
(1,016
|
)
|
|
1,176
|
|
|
106
|
|
|||
Foreign:
|
|
|
|
|
|
||||||
Current
|
(2,657
|
)
|
|
(1,212
|
)
|
|
(293
|
)
|
|||
Deferred
|
711
|
|
|
(40
|
)
|
|
141
|
|
|||
Total foreign
|
(1,946
|
)
|
|
(1,252
|
)
|
|
(152
|
)
|
|||
Total income tax expense
|
$
|
(4,929
|
)
|
|
$
|
(467
|
)
|
|
$
|
(6,704
|
)
|
(in thousands)
|
2019
|
|
2018
|
||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
12,265
|
|
|
$
|
16,835
|
|
Stock options and warrants
|
3,990
|
|
|
3,125
|
|
||
U.S. federal and state income tax credits
|
5,508
|
|
|
5,473
|
|
||
Accrued liabilities and other reserves
|
2,316
|
|
|
1,189
|
|
||
Other comprehensive income
|
146
|
|
|
206
|
|
||
Total deferred tax assets
|
24,225
|
|
|
26,828
|
|
||
Valuation allowance
|
(2,890
|
)
|
|
(2,299
|
)
|
||
Deferred tax assets, net of valuation allowance
|
$
|
21,335
|
|
|
$
|
24,529
|
|
Deferred tax liabilities:
|
|
|
|
||||
Property and equipment
|
$
|
(985
|
)
|
|
$
|
(68
|
)
|
Amortization of intangible assets
|
(6,863
|
)
|
|
(8,707
|
)
|
||
Other
|
(27
|
)
|
|
(105
|
)
|
||
Total deferred tax liabilities
|
$
|
(7,875
|
)
|
|
$
|
(8,880
|
)
|
(in thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
U.S. federal income tax (expense) benefit at statutory rate
|
$
|
(3,415
|
)
|
|
$
|
(340
|
)
|
|
$
|
20,261
|
|
U.S. state income taxes, net of federal benefit (expense)
|
(209
|
)
|
|
54
|
|
|
21
|
|
|||
Effect of rates different than the U.S. federal statutory income tax rate
|
(700
|
)
|
|
(466
|
)
|
|
311
|
|
|||
Goodwill impairment
|
—
|
|
|
—
|
|
|
(19,750
|
)
|
|||
Windfall tax benefit (deficiency)
|
160
|
|
|
(263
|
)
|
|
2,155
|
|
|||
Transaction costs
|
—
|
|
|
—
|
|
|
(819
|
)
|
|||
Executive compensation limitation
|
(115
|
)
|
|
(100
|
)
|
|
(283
|
)
|
|||
Non-deductible expenses
|
(53
|
)
|
|
(62
|
)
|
|
(825
|
)
|
|||
Stock-based compensation forfeitures and other
|
—
|
|
|
—
|
|
|
(562
|
)
|
|||
Rate change
|
—
|
|
|
(103
|
)
|
|
(7,672
|
)
|
|||
Dissolution of foreign entity
|
—
|
|
|
—
|
|
|
1,125
|
|
|||
Repatriation tax
|
—
|
|
|
82
|
|
|
(82
|
)
|
|||
Change in valuation allowance
|
(591
|
)
|
|
212
|
|
|
(731
|
)
|
|||
GILTI
|
(9
|
)
|
|
(251
|
)
|
|
—
|
|
|||
Additional U.S. state NOLs
|
—
|
|
|
765
|
|
|
—
|
|
|||
Other
|
3
|
|
|
5
|
|
|
147
|
|
|||
Total income tax expense
|
$
|
(4,929
|
)
|
|
$
|
(467
|
)
|
|
$
|
(6,704
|
)
|
(in thousands)
|
2019
|
||
Unrecognized tax benefit as of January 1
|
$
|
2,030
|
|
Gross increases
|
—
|
|
|
Unrecognized tax benefit as of December 31
|
$
|
2,030
|
|
(in thousands)
|
2019
|
|
2018
|
||||
Servers, computer equipment and software
|
$
|
14,901
|
|
|
$
|
13,656
|
|
Office furniture and equipment
|
863
|
|
|
575
|
|
||
Leasehold improvements
|
671
|
|
|
646
|
|
||
Total property and equipment
|
16,435
|
|
|
14,877
|
|
||
Less: Accumulated depreciation
|
(12,810
|
)
|
|
(10,243
|
)
|
||
Total property and equipment, net
|
$
|
3,625
|
|
|
$
|
4,634
|
|
(in thousands)
|
2019
|
||
Lease costs:
|
|
||
Operating lease cost(1)
|
$
|
2,735
|
|
|
|
||
Finance lease cost:
|
|
||
Depreciation expense
|
$
|
2
|
|
Interest on lease liabilities
|
5
|
|
|
Total finance lease cost
|
$
|
7
|
|
(1)
|
Short-term lease costs were immaterial.
|
(in thousands)
|
2019
|
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
Operating cash flows from operating leases
|
$
|
2,705
|
|
Operating cash flows from finance leases
|
$
|
5
|
|
Financing cash flows from finance leases
|
$
|
191
|
|
|
|
||
ROU assets obtained in exchange for lease obligations:
|
|
||
Operating leases
|
$
|
9,864
|
|
|
2019
|
||||||||||
(in thousands)
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||
Trademarks and domain names
|
$
|
35,602
|
|
|
$
|
(17,423
|
)
|
|
$
|
18,179
|
|
Customer relationships
|
15,248
|
|
|
(10,081
|
)
|
|
5,167
|
|
|||
Software
|
19,561
|
|
|
(13,602
|
)
|
|
5,959
|
|
|||
Total intangible assets. net
|
$
|
70,411
|
|
|
$
|
(41,106
|
)
|
|
$
|
29,305
|
|
|
2018
|
||||||||||
(in thousands)
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||
Trademarks and domain names
|
$
|
34,637
|
|
|
$
|
(13,407
|
)
|
|
$
|
21,230
|
|
Customer relationships
|
13,901
|
|
|
(7,130
|
)
|
|
6,771
|
|
|||
Software
|
18,722
|
|
|
(10,165
|
)
|
|
8,557
|
|
|||
Total intangible assets. net
|
$
|
67,260
|
|
|
$
|
(30,702
|
)
|
|
$
|
36,558
|
|
(in thousands)
|
Amortization
|
||
Year ending December 31,
|
Expense
|
||
2020
|
$
|
8,557
|
|
2021
|
7,087
|
|
|
2022
|
4,146
|
|
|
2023
|
2,746
|
|
|
2024
|
2,181
|
|
|
Thereafter
|
4,588
|
|
|
Total amortization expense
|
$
|
29,305
|
|
(in thousands)
|
Goodwill
|
||
Balance as of January 1, 2018
|
$
|
150,694
|
|
Foreign currency translation adjustments
|
(2,561
|
)
|
|
Balance as of December 31, 2018
|
148,133
|
|
|
Goodwill acquired from the Initech Acquisition
|
9,613
|
|
|
Foreign currency translation adjustments
|
(1,059
|
)
|
|
Balance as of December 31, 2019
|
$
|
156,687
|
|
(in thousands)
|
2019
|
|
2018
|
||||
Accrued broadcaster fees, net of breakage
|
$
|
5,350
|
|
|
$
|
5,039
|
|
Accrued professional fees
|
1,889
|
|
|
955
|
|
||
Accrued employee-related costs
|
4,803
|
|
|
6,226
|
|
||
Accrued service providers
|
940
|
|
|
439
|
|
||
Accrued advertising
|
2,315
|
|
|
2,181
|
|
||
Accrued current tax payable
|
1,209
|
|
|
1,662
|
|
||
Accrued value-added, sales, use and other taxes
|
1,472
|
|
|
1,030
|
|
||
Other accrued expenses
|
2,112
|
|
|
1,580
|
|
||
Total accrued liabilities
|
$
|
20,090
|
|
|
$
|
19,112
|
|
(in thousands)
|
2019
|
|
2018
|
||||
Term loan facility
|
$
|
34,125
|
|
|
$
|
36,940
|
|
Less: Debt discount, net
|
(192
|
)
|
|
(152
|
)
|
||
Less: Debt issuance costs, net
|
(58
|
)
|
|
(133
|
)
|
||
Net carrying amount
|
33,875
|
|
|
36,655
|
|
||
Less: Current portion
|
3,500
|
|
|
18,567
|
|
||
Long-term debt, net
|
$
|
30,375
|
|
|
$
|
18,088
|
|
(in thousands)
|
|
New Credit
|
||
Years Ending December 31,
|
|
Facilities
|
||
2020
|
|
$
|
3,500
|
|
2021
|
|
3,500
|
|
|
2022
|
|
27,125
|
|
|
Total minimum principal payments
|
|
$
|
34,125
|
|
(in thousands)
|
Cloud
|
||
Years Ending December 31,
|
Data Storage
|
||
2020
|
$
|
5,248
|
|
2021
|
6,882
|
|
|
2022
|
1,043
|
|
|
2023
|
1,147
|
|
|
Total minimum payments
|
$
|
14,320
|
|
|
For the Years Ended December 31,
|
||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Sales and marketing
|
$
|
412
|
|
|
$
|
904
|
|
|
$
|
440
|
|
Product development and content
|
6,495
|
|
|
4,768
|
|
|
4,008
|
|
|||
General and administrative
|
4,200
|
|
|
3,614
|
|
|
4,019
|
|
|||
Total stock-based compensation expense
|
$
|
11,107
|
|
|
$
|
9,286
|
|
|
$
|
8,467
|
|
(in thousands, except share and per share data)
|
|
Number of Stock Options
|
|
Weighted-
average
Exercise Price
|
|
Weighted-
average
Remaining
Contractual Life
|
|
Aggregate Intrinsic Value
|
|||||
Options
|
|
|
|
|
|||||||||
Outstanding as of December 31, 2018
|
|
3,965,894
|
|
|
$
|
3.67
|
|
|
|
|
|
|
|
Granted
|
|
—
|
|
|
—
|
|
|
|
|
|
|
||
Exercised
|
|
(179,914
|
)
|
|
4.29
|
|
|
|
|
|
|
||
Forfeited or expired
|
|
(105,834
|
)
|
|
5.05
|
|
|
|
|
|
|
||
Outstanding as of December 31, 2019
|
|
3,680,146
|
|
|
$
|
3.60
|
|
|
5.0
|
|
$
|
5,328
|
|
Exercisable as of December 31, 2019
|
|
3,341,318
|
|
|
$
|
3.51
|
|
|
4.8
|
|
$
|
5,138
|
|
|
December 31, 2017
|
|
Risk-free interest rate
|
1.90
|
%
|
Expected term (in years)
|
6.0
|
|
Expected dividend yield
|
—
|
|
Expected volatility
|
83
|
%
|
|
|
Number of
|
|
Weighted-average
|
|||
RSAs
|
|
RSAs
|
|
Stock Price
|
|||
Outstanding as of December 31, 2018
|
|
3,318,448
|
|
|
$
|
3.98
|
|
Granted
|
|
2,649,729
|
|
|
5.20
|
|
|
Vested
|
|
(1,701,711
|
)
|
|
3.78
|
|
|
Forfeited or expired
|
|
(230,068
|
)
|
|
4.51
|
|
|
Outstanding as of December 31, 2019
|
|
4,036,398
|
|
|
$
|
4.85
|
|
|
|
Number of
|
|
Weighted-average
|
|||
PSUs
|
|
PSUs
|
|
Stock Price
|
|||
Outstanding as of December 31, 2018
|
|
610,000
|
|
|
$
|
3.11
|
|
Granted
|
|
476,100
|
|
|
5.91
|
|
|
Vested
|
|
—
|
|
|
—
|
|
|
Forfeited or expired
|
|
—
|
|
|
—
|
|
|
Outstanding as of December 31, 2019
|
|
1,086,100
|
|
|
$
|
4.34
|
|
(in thousands)
|
|
Derivative Financial Instruments
|
|
Cumulative Foreign Currency Translation Adjustment
|
|
|
||||||
Accumulated Other Comprehensive Loss
|
|
|
|
Total
|
||||||||
Balance as of January 1, 2017
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Unrealized loss on derivative financial instruments
|
|
(2,303
|
)
|
|
—
|
|
|
(2,303
|
)
|
|||
Reclassification of loss on derivative financial instruments
|
|
1,566
|
|
|
—
|
|
|
1,566
|
|
|||
Foreign currency translation adjustment
|
|
—
|
|
|
(388
|
)
|
|
(388
|
)
|
|||
Balance as of December 31, 2017
|
|
(737
|
)
|
|
(388
|
)
|
|
(1,125
|
)
|
|||
Unrealized gain on derivative financial instruments
|
|
2,088
|
|
|
—
|
|
|
2,088
|
|
|||
Reclassification of gain on derivative financial instruments
|
|
(2,059
|
)
|
|
—
|
|
|
(2,059
|
)
|
|||
Foreign currency translation adjustment
|
|
—
|
|
|
(938
|
)
|
|
(938
|
)
|
|||
Balance as of December 31, 2018
|
|
(708
|
)
|
|
(1,326
|
)
|
|
(2,034
|
)
|
|||
Unrealized gain on derivative financial instruments
|
|
1,197
|
|
|
—
|
|
|
1,197
|
|
|||
Reclassification of gain on derivative financial instruments
|
|
(1,125
|
)
|
|
—
|
|
|
(1,125
|
)
|
|||
Foreign currency translation adjustment
|
|
—
|
|
|
(387
|
)
|
|
(387
|
)
|
|||
Balance as of December 31, 2019
|
|
$
|
(636
|
)
|
|
$
|
(1,713
|
)
|
|
$
|
(2,349
|
)
|
(in thousands)
|
|
Number of Instruments
|
|
At Inception Notional
|
|
As of December 31, 2019 Notional
|
|
Weighted-average
Maturity Date (Years) |
Interest Rate Derivative
|
|
|
|
|
||||
Interest rate swaps
|
|
2
|
|
$57,185
|
|
$23,435
|
|
1.72
|
Interest rate caps
|
|
1
|
|
$15,000
|
|
$10,690
|
|
0.72
|
(in thousands)
|
|
Number of Instruments
|
|
|
|
|
|
Weighted-average
Maturity Date (Years) |
Foreign Currency Derivative
|
|
|
Pay Fixed Notional
|
|
Receive Fixed Notional
|
|
||
Cross-currency swap
|
|
1
|
|
€36,868
|
|
$40,750
|
|
2.66
|
|
|
|
|
(amortizing to €35,963 as of December 31, 2019)
|
|
(amortizing to $39,750 as of December 31, 2019)
|
|
|
(in thousands)
|
|
Amount of Gain (Loss) Recognized in Other Comprehensive Loss from Derivatives
|
||||||||||
Derivatives in Cash Flow Hedging Relationships
|
|
|||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Interest rate products
|
|
$
|
(119
|
)
|
|
$
|
290
|
|
|
$
|
(76
|
)
|
Cross-currency contract
|
|
1,879
|
|
|
2,797
|
|
|
(2,227
|
)
|
|||
Total unrealized gain (loss)
|
|
$
|
1,760
|
|
|
$
|
3,087
|
|
|
$
|
(2,303
|
)
|
|
|
Interest Expense
|
||||||||||
(in thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Total amounts of interest expense presented in the consolidated statements of operations in which the effects of cash flow hedges are recorded
|
|
$
|
(1,301
|
)
|
|
$
|
(2,322
|
)
|
|
$
|
(860
|
)
|
Gain on cash flow hedging relationships:
|
|
|
|
|
|
|
||||||
Amount of gain reclassified from other comprehensive loss into income or loss
|
|
$
|
(793
|
)
|
|
$
|
(891
|
)
|
|
$
|
(110
|
)
|
Amount of gain reclassified from other comprehensive loss into income or loss as a result of a forecasted transaction being no longer probable of occurring
|
|
$
|
—
|
|
|
$
|
(30
|
)
|
|
$
|
—
|
|
|
|
Foreign Currency Transactions
|
||||||||||
(in thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Total amounts of (loss) gain on foreign currency transactions presented in the consolidated statements of operations in which the effects of cash flow hedges are recorded
|
|
$
|
(51
|
)
|
|
$
|
97
|
|
|
$
|
(33
|
)
|
(Gain) loss on cash flow hedging relationships:
|
|
|
|
|
|
|
||||||
Amount of (gain) loss reclassified from other comprehensive loss into income or loss
|
|
$
|
(837
|
)
|
|
$
|
(2,063
|
)
|
|
$
|
1,676
|
|
|
|
|
|
Fair Value of Derivative Instruments
|
||||||||||||||
|
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||
(in thousands)
|
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Derivatives Designated as Hedging Instruments
|
|
Balance Sheet Location
|
|
Fair Value
|
|
Fair Value
|
|
Fair Value
|
|
Fair Value
|
||||||||
Interest rate products
|
|
Prepaid expenses and other current assets / Accrued expenses
|
|
$
|
15
|
|
|
$
|
166
|
|
|
$
|
(12
|
)
|
|
$
|
—
|
|
Interest rate products
|
|
Other assets / Long-term derivative liability
|
|
—
|
|
|
53
|
|
|
(9
|
)
|
|
—
|
|
||||
Cross-currency swap
|
|
Prepaid expenses and other current assets / Accrued expenses
|
|
568
|
|
|
753
|
|
|
—
|
|
|
—
|
|
||||
Cross-currency swap
|
|
Long-term derivative liabilities
|
|
—
|
|
|
—
|
|
|
(1,442
|
)
|
|
(940
|
)
|
||||
Total derivatives designated as hedging instruments
|
|
|
|
$
|
583
|
|
|
$
|
972
|
|
|
$
|
(1,463
|
)
|
|
$
|
(940
|
)
|
|
2019
|
|
2018
|
|
2017(1)
|
|||||||||||||||
(in thousands)
|
$
|
|
%
|
|
$
|
|
%
|
|
$
|
|
%
|
|||||||||
User pay revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Video
|
$
|
84,113
|
|
|
39.7
|
%
|
|
$
|
39,282
|
|
|
22.0
|
%
|
|
$
|
1,927
|
|
|
1.6
|
%
|
Subscription and other in-app products
|
61,683
|
|
|
29.2
|
%
|
|
68,048
|
|
|
38.1
|
%
|
|
31,865
|
|
|
25.7
|
%
|
|||
Total user pay revenue
|
145,796
|
|
|
68.9
|
%
|
|
107,330
|
|
|
60.1
|
%
|
|
33,792
|
|
|
27.3
|
%
|
|||
Advertising
|
65,905
|
|
|
31.1
|
%
|
|
71,283
|
|
|
39.9
|
%
|
|
89,962
|
|
|
72.7
|
%
|
|||
Total revenue
|
$
|
211,701
|
|
|
100.0
|
%
|
|
$
|
178,613
|
|
|
100.0
|
%
|
|
$
|
123,754
|
|
|
100.0
|
%
|
(1)
|
Prior period amounts have not been adjusted under the modified retrospective adoption method for the Company’s adoption of ASC Topic 606.
|
(in thousands)
|
2019
|
|
2018
|
||||
Assets:
|
|
|
|
||||
Accounts receivable
|
$
|
25,503
|
|
|
$
|
27,532
|
|
Total contract assets
|
$
|
25,503
|
|
|
$
|
27,532
|
|
Liabilities:
|
|
|
|
|
|||
Deferred revenue
|
$
|
3,884
|
|
|
$
|
4,621
|
|
Total contract liabilities
|
$
|
3,884
|
|
|
$
|
4,621
|
|
|
For the Year Ended December 31,
|
||||||||||
(in thousands, except per share data)
|
2019
|
|
2018
|
|
2017
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
11,334
|
|
|
$
|
1,143
|
|
|
$
|
(64,592
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average shares outstanding — basic
|
74,118,035
|
|
|
73,085,542
|
|
|
68,743,956
|
|
|||
Effect of dilutive securities
|
2,803,385
|
|
|
2,530,897
|
|
|
—
|
|
|||
Weighted-average shares outstanding — diluted
|
76,921,420
|
|
|
75,616,439
|
|
|
68,743,956
|
|
|||
Basic net income (loss) per share
|
$
|
0.15
|
|
|
$
|
0.02
|
|
|
$
|
(0.94
|
)
|
Diluted net income (loss) per share
|
$
|
0.15
|
|
|
$
|
0.02
|
|
|
$
|
(0.94
|
)
|
(in thousands)
|
Quoted Prices
in Active
Markets for
Identical
Items
(Level 1)
|
|
Significant Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
December 31, 2019
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
7,108
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,108
|
|
Derivative assets
|
—
|
|
|
583
|
|
|
—
|
|
|
583
|
|
||||
Total assets
|
$
|
7,108
|
|
|
$
|
583
|
|
|
$
|
—
|
|
|
$
|
7,691
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Contingent consideration
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(894
|
)
|
|
$
|
(894
|
)
|
Derivative liabilities
|
—
|
|
|
(1,463
|
)
|
|
—
|
|
|
(1,463
|
)
|
||||
Total liabilities
|
$
|
—
|
|
|
$
|
(1,463
|
)
|
|
$
|
(894
|
)
|
|
$
|
(2,357
|
)
|
December 31, 2018
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
7,640
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,640
|
|
Derivative assets
|
—
|
|
|
972
|
|
|
—
|
|
|
972
|
|
||||
Total assets
|
$
|
7,640
|
|
|
$
|
972
|
|
|
$
|
—
|
|
|
$
|
8,612
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivative liabilities
|
$
|
—
|
|
|
$
|
(940
|
)
|
|
$
|
—
|
|
|
$
|
(940
|
)
|
Total liabilities
|
$
|
—
|
|
|
$
|
(940
|
)
|
|
$
|
—
|
|
|
$
|
(940
|
)
|
(in thousands)
|
|
|
|
Management Incentive Bonus
|
|
RSAs Granted
|
|
|
||||||||
Related Party
|
|
Salary
|
|
|
|
Total
|
||||||||||
Catherine Connelly, Vice President, Brand Strategy(1)
|
|
$
|
161
|
|
|
$
|
31
|
|
|
$
|
167
|
|
|
$
|
359
|
|
Matthew Eustice, Vice President, Quality Assurance(2)
|
|
167
|
|
|
32
|
|
|
167
|
|
|
366
|
|
||||
Andrew Connelly, Design Lead(3)
|
|
121
|
|
|
—
|
|
|
38
|
|
|
159
|
|
(1)
|
Ms. Connelly is the sister of Geoffrey Cook, the Company’s CEO.
|
(2)
|
Mr. Eustice is the brother-in-law of Mr. Cook.
|
(3)
|
Mr. Connelly is the brother-in-law of Mr. Cook.
|
|
For the Quarters Ended,
|
||||||||||||||
|
2019
|
||||||||||||||
(in thousands, except per share data) (1)
|
December 31
|
|
September 30
|
|
June 30
|
|
March 31
|
||||||||
Revenue
|
$
|
57,567
|
|
|
$
|
52,621
|
|
|
$
|
52,000
|
|
|
$
|
49,513
|
|
Operating costs and expenses
|
49,770
|
|
|
48,337
|
|
|
48,557
|
|
|
47,569
|
|
||||
Income from operations
|
7,797
|
|
|
4,284
|
|
|
3,443
|
|
|
1,944
|
|
||||
Net income
|
4,878
|
|
|
2,993
|
|
|
2,205
|
|
|
1,258
|
|
||||
Basic net income per share
|
$
|
0.07
|
|
|
$
|
0.04
|
|
|
$
|
0.03
|
|
|
$
|
0.02
|
|
Diluted net income per share
|
$
|
0.07
|
|
|
$
|
0.04
|
|
|
$
|
0.03
|
|
|
$
|
0.02
|
|
|
For the Quarters Ended,
|
||||||||||||||
|
2018
|
||||||||||||||
(in thousands, except per share data) (1)
|
December 31
|
|
September 30
|
|
June 30
|
|
March 31
|
||||||||
Revenue
|
$
|
52,458
|
|
|
$
|
45,716
|
|
|
$
|
42,801
|
|
|
$
|
37,638
|
|
Operating costs and expenses
|
47,626
|
|
|
43,667
|
|
|
41,860
|
|
|
41,598
|
|
||||
Income (loss) from operations
|
4,832
|
|
|
2,049
|
|
|
941
|
|
|
(3,960
|
)
|
||||
Net income (loss)
|
4,294
|
|
|
1,298
|
|
|
(235
|
)
|
|
(4,214
|
)
|
||||
Basic net income (loss) per share
|
$
|
0.06
|
|
|
$
|
0.02
|
|
|
$
|
—
|
|
|
$
|
(0.06
|
)
|
Diluted net income (loss) per share
|
$
|
0.06
|
|
|
$
|
0.02
|
|
|
$
|
—
|
|
|
$
|
(0.06
|
)
|
(1)
|
The sum of the Company’s quarterly results may not equal its full-year results for the periods presented due to rounding.
|
|
|
|
|
|
|
|
|
|
|
Filed or
|
|
|
|
|
Incorporated by Reference
|
|
Furnished
|
||||
Exhibit No.
|
|
Exhibit Description
|
|
Form
|
|
Date
|
|
Number
|
|
Herewith
|
|
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
|
|
|
|
|
Agreement and Plan of Merger, dated as of March 5, 2020, by and among The Meet Group, Inc., a Delaware corporation, eHarmony Holding, Inc., a Delaware corporation, Holly Merger Sub, Inc., a Delaware corporation and direct, wholly owned Subsidiary of Buyer and NCG NuCom Group SE, a European stock corporation*
|
|
8-K
|
|
3/5/2020
|
|
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
|
|
|
|
|
Certificate of Amendment to the Certificate of Incorporation – Name Change
|
|
8-K
|
|
4/3/2017
|
|
3.1
|
|
|
|
|
Amended and Restated Bylaws
|
|
8-K
|
|
11/7/2018
|
|
3.1
|
|
|
|
|
Certificate of Designation of Series A Junior Participating Preferred Stock
|
|
8-K
|
|
10/4/2019
|
|
3.1
|
|
|
|
|
Description of Securities of the Registrant
|
|
|
|
|
|
|
|
Filed
|
|
|
Section 382 Tax Benefits Preservation Plan, dated as of October 4, 2019, by and between The Meet Group, Inc. and Action Stock Transfer Corporation, as Rights Agent
|
|
8-K
|
|
10/4/2019
|
|
4.1
|
|
|
|
|
|
|
|
|
|
|
|
|
Filed or
|
|
|
|
|
Incorporated by Reference
|
|
Furnished
|
||||
Exhibit No.
|
|
Exhibit Description
|
|
Form
|
|
Date
|
|
Number
|
|
Herewith
|
|
Amendment No. 1, dated as of March 5, 2020, to the Tax Benefits Preservation Plan, dated as of October 4, 2019, by and between The Meet Group, Inc. and Action Stock Transfer Corporation, as Rights Agent
|
|
8-K
|
|
3/5/2020
|
|
4.1
|
|
|
|
|
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
|
|
|
|
|
2018 Omnibus Incentive Plan**
|
|
S-8
|
|
6/7/2018
|
|
99.1
|
|
|
|
|
Form of Director Restricted Stock Award Agreement**
|
|
10-Q
|
|
11/8/2018
|
|
10.1
|
|
|
|
|
Form of Employee Restricted Stock Award Agreement**
|
|
10-Q
|
|
11/8/2018
|
|
10.2
|
|
|
|
|
Form of Employee Restricted Stock Award Agreement — LOVOO Employee
|
|
10-Q
|
|
11/8/2018
|
|
10.3
|
|
|
|
|
Employee Performance Share Award Agreement**
|
|
10-Q
|
|
8/2/2018
|
|
10.1
|
|
|
|
|
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
|
|
|
|
|
Form of Amended and Restated Employment Agreement (William Alena and Frederic Beckley)**
|
|
10-Q
|
|
11/9/2016
|
|
10.2
|
|
|
|
|
Niklas Lindstrom Offer Letter**
|
|
10-K
|
|
3/16/2018
|
|
10.19
|
|
|
|
|
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
|
|
|
|
|
Credit Agreement, dated as of August 29, 2019, with several banks and other financial institutions party thereto and Bank of America, N.A., as administrative agent.
|
|
8-K
|
|
9/4/2019
|
|
10.1
|
|
|
|
|
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
|
|
|
|
|
Third Amendment and Limited Waiver to Amended and Restated Credit Agreement, dated as of July 27, 2018 with the several banks and other financial institutions party thereto and JPMorgan Chase Bank, N.A., as administrative agent
|
|
8-K
|
|
8/1/2018
|
|
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
|
|
|
|
|
Form of Transaction Bonus Agreement
|
|
8-K
|
|
3/5/2020
|
|
10.1
|
|
|
|
|
Amendment to Employee Performance Share Award Agreements, effective as of the date immediately prior to the consummation of the Contemplated Transactions, amending the Employee Performance Share Award Agreements, dated as of April 9, 2018 and April 4, 2019, by and between The Meet Group, Inc. and Geoff Cook
|
|
8-K
|
|
3/5/2020
|
|
10.2
|
|
|
|
|
Amendment No. 4 to Employment Agreement, amending the Employment Agreement between The Meet Group, Inc. and Geoff Cook
|
|
8-K
|
|
3/5/2020
|
|
10.3
|
|
|
|
|
Amendment No. 5 to Employment Agreement amending the Employment Agreement between The Meet Group, Inc. and Geoff Cook
|
|
8-K
|
|
3/5/2020
|
|
10.4
|
|
|
|
|
Amendment No. 1 to Employment Agreement, dated as of March 2, 2018, by and between The Meet Group, Inc. and James Bugden
|
|
8-K
|
|
3/5/2020
|
|
10.5
|
|
|
|
|
Amendment No. 1 to Employment Agreement, dated as of March 2, 2018, by and between The Meet Group, Inc. and Michael Johnson
|
|
8-K
|
|
3/5/2020
|
|
10.6
|
|
|
|
|
List of Subsidiaries
|
|
|
|
|
|
|
|
Filed
|
|
|
Consent of RSM US LLP
|
|
|
|
|
|
|
|
Filed
|
|
|
Certification of Principal Executive Officer (Section 302)
|
|
|
|
|
|
|
|
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
|
|
|
|
|
|
|
|
****
|
*
|
Certain schedules and exhibits to this agreement have been omitted pursuant to Item 601 (b)(2) of Regulation S-K. The Company will furnish the omitted schedules and exhibits to the SEC upon request.
|
**
|
Management contract or compensatory plan or arrangement.
|
***
|
This exhibit is being furnished rather than filed and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.
|
|
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 11, 2020
|
Geoffrey Cook
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/James Bugden
|
|
Chief Financial Officer
|
|
March 11, 2020
|
James Bugden
|
|
(Principal Financial Officer and Principal Accounting Officer)
|
|
|
|
|
|
|
|
/s/Spencer Rhodes
|
|
Director, Chairman of the Board of Directors
|
|
March 11, 2020
|
Spencer Rhodes
|
|
|
|
|
|
|
|
|
|
/s/Jean Clifton
|
|
Director
|
|
March 11, 2020
|
Jean Clifton
|
|
|
|
|
|
|
|
|
|
/s/Christopher Fralic
|
|
Director
|
|
March 11, 2020
|
Christopher Fralic
|
|
|
|
|
|
|
|
|
|
/s/Keith Richman
|
|
Director
|
|
March 11, 2020
|
Keith Richman
|
|
|
|
|
|
|
|
|
|
/s/Bedi Singh
|
|
Director
|
|
March 11, 2020
|
Bedi Singh
|
|
|
|
|
|
|
|
|
|
/s/Jason Whitt
|
|
Director
|
|
March 11, 2020
|
Jason Whitt
|
|
|
|
|
•
|
for breach of the duty of loyalty;
|
•
|
for acts or omissions not in good faith or involving intentional misconduct or knowing violation of law;
|
•
|
under Section 174 of the DGCL (relating to unlawful dividends or stock repurchases); or
|
•
|
for transactions from which the director derived an improper personal benefit.
|
/s/ RSM US LLP
|
|
|
Blue Bell, Pennsylvania
|
March 11, 2020
|
1.
|
I have reviewed this annual 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 annual 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 and Principal Accounting 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 Bugden
|
Chief Financial Officer
|
(Principal Financial Officer and Principal Accounting Officer)
|