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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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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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87-0634302
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification Number)
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799 West Coliseum Way, Midvale, Utah
|
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84047
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(Address of principal executive offices)
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(Zip Code)
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(801) 947-3100
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||
(Registrant's telephone number, including area code)
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Large accelerated filer
o
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Accelerated filer
x
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Non-accelerated filer
o
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Smaller reporting company
o
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Emerging growth company
o
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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June 30,
2018 |
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December 31,
2017 |
||||
Assets
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
152,228
|
|
|
$
|
203,215
|
|
Restricted cash
|
468
|
|
|
455
|
|
||
Accounts receivable, net
|
28,597
|
|
|
30,080
|
|
||
Inventories, net
|
15,355
|
|
|
13,703
|
|
||
Prepaid inventories, net
|
1,071
|
|
|
1,625
|
|
||
Prepaids and other current assets
|
25,419
|
|
|
16,119
|
|
||
Total current assets
|
223,138
|
|
|
265,197
|
|
||
Fixed assets, net
|
131,923
|
|
|
129,343
|
|
||
Intangible assets, net
|
26,343
|
|
|
7,337
|
|
||
Goodwill
|
22,058
|
|
|
14,698
|
|
||
Equity Investments
|
43,543
|
|
|
13,024
|
|
||
Other long-term assets, net
|
5,888
|
|
|
4,216
|
|
||
Total assets
|
$
|
452,893
|
|
|
$
|
433,815
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
92,712
|
|
|
$
|
85,406
|
|
Accrued liabilities
|
109,732
|
|
|
82,611
|
|
||
Deferred revenue
|
42,644
|
|
|
46,468
|
|
||
Other current liabilities, net
|
468
|
|
|
178
|
|
||
Total current liabilities
|
245,556
|
|
|
214,663
|
|
||
Long-term debt, net
|
3,069
|
|
|
—
|
|
||
Long-term debt, net - related party
|
—
|
|
|
39,909
|
|
||
Other long-term liabilities
|
6,160
|
|
|
7,120
|
|
||
Total liabilities
|
254,785
|
|
|
261,692
|
|
||
Commitments and contingencies (Note 6)
|
|
|
|
|
|
||
Stockholders’ equity:
|
|
|
|
|
|
||
Preferred stock, $0.0001 par value, authorized shares - 5,000
|
|
|
|
|
|
||
Series A, issued and outstanding - 127 and 127
|
—
|
|
|
—
|
|
||
Series B, issued and outstanding - 555 and 555
|
—
|
|
|
—
|
|
||
Common stock, $0.0001 par value
|
|
|
|
|
|
||
Authorized shares - 100,000
|
|
|
|
|
|
||
Issued shares - 32,203 and 30,632
|
|
|
|
|
|
||
Outstanding shares - 29,007 and 27,497
|
3
|
|
|
3
|
|
||
Additional paid-in capital
|
553,112
|
|
|
494,732
|
|
||
Accumulated deficit
|
(365,472
|
)
|
|
(254,692
|
)
|
||
Accumulated other comprehensive loss
|
(591
|
)
|
|
(599
|
)
|
||
Treasury stock:
|
|
|
|
|
|
||
Shares at cost - 3,196 and 3,135
|
(66,662
|
)
|
|
(63,816
|
)
|
||
Equity attributable to stockholders of Overstock.com, Inc.
|
120,390
|
|
|
175,628
|
|
||
Equity attributable to noncontrolling interests
|
77,718
|
|
|
(3,505
|
)
|
||
Total equity
|
198,108
|
|
|
172,123
|
|
||
Total liabilities and stockholders’ equity
|
$
|
452,893
|
|
|
$
|
433,815
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue, net
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct
|
$
|
14,715
|
|
|
$
|
22,099
|
|
|
$
|
30,985
|
|
|
$
|
44,927
|
|
Partner and other
|
468,418
|
|
|
409,925
|
|
|
897,479
|
|
|
819,532
|
|
||||
Total net revenue
|
483,133
|
|
|
432,024
|
|
|
928,464
|
|
|
864,459
|
|
||||
Cost of goods sold
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct
(1)
|
14,672
|
|
|
21,147
|
|
|
29,444
|
|
|
42,110
|
|
||||
Partner and other
|
376,718
|
|
|
326,706
|
|
|
713,408
|
|
|
651,271
|
|
||||
Total cost of goods sold
|
391,390
|
|
|
347,853
|
|
|
742,852
|
|
|
693,381
|
|
||||
Gross profit
|
91,743
|
|
|
84,171
|
|
|
185,612
|
|
|
171,078
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Sales and marketing
(1)
|
94,416
|
|
|
43,297
|
|
|
171,630
|
|
|
80,915
|
|
||||
Technology
(1)
|
32,423
|
|
|
28,244
|
|
|
63,717
|
|
|
57,236
|
|
||||
General and administrative
(1)
|
31,440
|
|
|
22,361
|
|
|
71,195
|
|
|
44,971
|
|
||||
Total operating expenses
|
158,279
|
|
|
93,902
|
|
|
306,542
|
|
|
183,122
|
|
||||
Operating loss
|
(66,536
|
)
|
|
(9,731
|
)
|
|
(120,930
|
)
|
|
(12,044
|
)
|
||||
Interest income
|
620
|
|
|
136
|
|
|
1,164
|
|
|
261
|
|
||||
Interest expense
|
(395
|
)
|
|
(716
|
)
|
|
(1,269
|
)
|
|
(1,426
|
)
|
||||
Other income (expense), net
|
368
|
|
|
593
|
|
|
359
|
|
|
(3,131
|
)
|
||||
Loss before income taxes
|
(65,943
|
)
|
|
(9,718
|
)
|
|
(120,676
|
)
|
|
(16,340
|
)
|
||||
Benefit from income taxes
|
(27
|
)
|
|
(1,975
|
)
|
|
(304
|
)
|
|
(2,315
|
)
|
||||
Consolidated net loss
|
$
|
(65,916
|
)
|
|
$
|
(7,743
|
)
|
|
$
|
(120,372
|
)
|
|
$
|
(14,025
|
)
|
Less: Net loss attributable to noncontrolling interests
|
(1,005
|
)
|
|
(244
|
)
|
|
(4,552
|
)
|
|
(623
|
)
|
||||
Net loss attributable to stockholders of Overstock.com, Inc.
|
$
|
(64,911
|
)
|
|
$
|
(7,499
|
)
|
|
$
|
(115,820
|
)
|
|
$
|
(13,402
|
)
|
Net loss per common share—basic:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss attributable to common shares—basic
|
$
|
(2.20
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(3.94
|
)
|
|
$
|
(0.52
|
)
|
Weighted average common shares outstanding—basic
|
28,903
|
|
|
24,996
|
|
|
28,736
|
|
|
25,035
|
|
||||
Net loss per common share—diluted:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss attributable to common shares—diluted
|
$
|
(2.20
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(3.94
|
)
|
|
$
|
(0.52
|
)
|
Weighted average common shares outstanding—diluted
|
28,903
|
|
|
24,996
|
|
|
28,736
|
|
|
25,035
|
|
(1) Includes stock-based compensation as follows (Note 8):
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cost of goods sold — direct
|
$
|
41
|
|
|
$
|
39
|
|
|
$
|
111
|
|
|
$
|
88
|
|
Sales and marketing
|
315
|
|
|
113
|
|
|
1,188
|
|
|
209
|
|
||||
Technology
|
621
|
|
|
150
|
|
|
1,142
|
|
|
310
|
|
||||
General and administrative
|
1,996
|
|
|
743
|
|
|
6,967
|
|
|
1,378
|
|
||||
Total
|
$
|
2,973
|
|
|
$
|
1,045
|
|
|
$
|
9,408
|
|
|
$
|
1,985
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Consolidated net loss
|
$
|
(65,916
|
)
|
|
$
|
(7,743
|
)
|
|
$
|
(120,372
|
)
|
|
$
|
(14,025
|
)
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
||||||||
Unrealized gain on cash flow hedges, net of expense for taxes of $0, $55, $0, and $(40)
|
4
|
|
|
(81
|
)
|
|
8
|
|
|
68
|
|
||||
Other comprehensive income
|
4
|
|
|
(81
|
)
|
|
8
|
|
|
68
|
|
||||
Comprehensive loss
|
$
|
(65,912
|
)
|
|
$
|
(7,824
|
)
|
|
$
|
(120,364
|
)
|
|
$
|
(13,957
|
)
|
Less: Comprehensive loss attributable to noncontrolling interests
|
(1,005
|
)
|
|
(244
|
)
|
|
(4,552
|
)
|
|
(623
|
)
|
||||
Comprehensive loss attributable to stockholders of Overstock.com, Inc.
|
$
|
(64,907
|
)
|
|
$
|
(7,580
|
)
|
|
$
|
(115,812
|
)
|
|
$
|
(13,334
|
)
|
|
Six months ended
June 30, 2018 |
||
Equity attributable to stockholders of Overstock.com, Inc.
|
|
|
|
Number of common shares issued
|
|
||
Balance at beginning of period
|
30,632
|
|
|
Common stock issued upon vesting of restricted stock
|
221
|
|
|
Common stock issued for asset purchase
|
100
|
|
|
Exercise of stock warrants
|
1,250
|
|
|
Balance at end of period
|
32,203
|
|
|
|
|
||
Number of treasury stock shares
|
|
||
Balance at beginning of period
|
3,135
|
|
|
Tax withholding upon vesting of restricted stock
|
61
|
|
|
Balance at end of period
|
3,196
|
|
|
Total number of outstanding shares
|
29,007
|
|
|
|
|
||
Common stock
|
$
|
3
|
|
|
|
||
Number of Series A preferred shares issued and outstanding
|
127
|
|
|
|
|
||
Number of Series B preferred shares issued and outstanding
|
555
|
|
|
|
|
||
Preferred stock
|
$
|
—
|
|
|
|
||
Additional paid-in capital
|
|
||
Balance at beginning of period
|
$
|
494,732
|
|
Stock-based compensation to employees and directors
|
5,368
|
|
|
Common stock issued for asset purchase
|
2,930
|
|
|
Exercise of stock warrants
|
50,562
|
|
|
Sale of stock warrants
|
25
|
|
|
Other
|
(505
|
)
|
|
Balance at end of period
|
$
|
553,112
|
|
|
|
||
Accumulated deficit
|
|
||
Balance at beginning of period
|
$
|
(254,692
|
)
|
Cumulative effect of change in accounting principle
|
5,040
|
|
|
Net loss attributable to stockholders of Overstock.com, Inc.
|
(115,820
|
)
|
|
Balance at end of period
|
$
|
(365,472
|
)
|
|
|
||
Accumulated other comprehensive loss
|
|
||
Balance at beginning of period
|
$
|
(599
|
)
|
Net other comprehensive income
|
8
|
|
|
Balance at end of period
|
$
|
(591
|
)
|
|
|
||
Treasury stock
|
|
||
Balance at beginning of period
|
$
|
(63,816
|
)
|
Tax withholding upon vesting of restricted stock
|
(2,846
|
)
|
|
Balance at end of period
|
(66,662
|
)
|
|
Total equity attributable to stockholders of Overstock.com, Inc.
|
$
|
120,390
|
|
|
|
||
Equity attributable to noncontrolling interests
|
|
||
Balance at beginning of period
|
$
|
(3,505
|
)
|
Proceeds from security token offering, net of offering costs (Note 2 -
Noncontrolling Interest
)
|
78,442
|
|
|
Stock-based compensation to employees and directors
|
4,040
|
|
|
Tax withholding upon vesting of restricted stock
|
(1,680
|
)
|
|
Net loss attributable to noncontrolling interests
|
(4,552
|
)
|
|
Fair value of noncontrolling interests at acquisition
|
4,468
|
|
|
Other
|
505
|
|
|
Total equity attributable to noncontrolling interests
|
$
|
77,718
|
|
|
|
||
Total equity
|
$
|
198,108
|
|
|
Six months ended
June 30, |
|
Twelve months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Consolidated net loss
|
$
|
(120,372
|
)
|
|
$
|
(14,025
|
)
|
|
$
|
(218,269
|
)
|
|
$
|
(14,656
|
)
|
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation of fixed assets
|
12,983
|
|
|
14,909
|
|
|
26,922
|
|
|
29,896
|
|
||||
Amortization of intangible assets
|
2,051
|
|
|
1,891
|
|
|
4,159
|
|
|
3,637
|
|
||||
Stock-based compensation to employees and directors
|
9,408
|
|
|
1,985
|
|
|
11,500
|
|
|
4,161
|
|
||||
Deferred income taxes, net
|
(298
|
)
|
|
(2,796
|
)
|
|
67,697
|
|
|
(2,445
|
)
|
||||
Gain on investment in precious metals
|
—
|
|
|
—
|
|
|
(1,971
|
)
|
|
(201
|
)
|
||||
Impairment of cryptocurrencies
|
9,491
|
|
|
—
|
|
|
9,491
|
|
|
—
|
|
||||
Gain on sale of cryptocurrencies
|
(8,348
|
)
|
|
—
|
|
|
(10,343
|
)
|
|
—
|
|
||||
Impairment of equity securities
|
—
|
|
|
4,500
|
|
|
987
|
|
|
7,350
|
|
||||
Early extinguishment costs of long term debts
|
283
|
|
|
—
|
|
|
2,747
|
|
|
—
|
|
||||
Other
|
(609
|
)
|
|
65
|
|
|
202
|
|
|
423
|
|
||||
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Accounts receivable, net
|
1,882
|
|
|
7,391
|
|
|
(7,447
|
)
|
|
(1,446
|
)
|
||||
Inventories, net
|
120
|
|
|
3,785
|
|
|
1,569
|
|
|
2,366
|
|
||||
Prepaid inventories, net
|
554
|
|
|
897
|
|
|
144
|
|
|
3
|
|
||||
Prepaids and other current assets
|
(8,234
|
)
|
|
(9,213
|
)
|
|
(2,307
|
)
|
|
(3,809
|
)
|
||||
Other long-term assets, net
|
(3,827
|
)
|
|
(147
|
)
|
|
(5,987
|
)
|
|
(729
|
)
|
||||
Accounts payable
|
6,686
|
|
|
(30,601
|
)
|
|
16,292
|
|
|
(3,127
|
)
|
||||
Accrued liabilities
|
26,911
|
|
|
(22,391
|
)
|
|
36,991
|
|
|
3,578
|
|
||||
Deferred revenue
|
1,216
|
|
|
(2,643
|
)
|
|
8,547
|
|
|
(4,933
|
)
|
||||
Other long-term liabilities
|
(476
|
)
|
|
136
|
|
|
(467
|
)
|
|
194
|
|
||||
Net cash (used in) provided by operating activities
|
(70,579
|
)
|
|
(46,257
|
)
|
|
(59,543
|
)
|
|
20,262
|
|
||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Purchases of intangible assets
|
(9,241
|
)
|
|
—
|
|
|
(9,664
|
)
|
|
—
|
|
||||
Proceeds from sale of precious metals
|
—
|
|
|
—
|
|
|
11,917
|
|
|
1,610
|
|
||||
Investment in precious metals
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,633
|
)
|
||||
Disbursement of note receivable
|
(200
|
)
|
|
(250
|
)
|
|
(700
|
)
|
|
(868
|
)
|
||||
Investment in equity securities
|
(29,570
|
)
|
|
(3,188
|
)
|
|
(31,570
|
)
|
|
(3,938
|
)
|
||||
Acquisitions of businesses, net of cash acquired
|
(12,912
|
)
|
|
—
|
|
|
(12,912
|
)
|
|
28
|
|
||||
Expenditures for fixed assets, including internal-use software and website development
|
(12,749
|
)
|
|
(16,450
|
)
|
|
(19,885
|
)
|
|
(45,883
|
)
|
||||
Other
|
22
|
|
|
(115
|
)
|
|
207
|
|
|
(118
|
)
|
||||
Net cash used in investing activities
|
(64,650
|
)
|
|
(20,003
|
)
|
|
(62,607
|
)
|
|
(50,802
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Payments on capital lease obligations
|
(248
|
)
|
|
—
|
|
|
(331
|
)
|
|
—
|
|
||||
Payments on interest swap
|
—
|
|
|
—
|
|
|
(1,535
|
)
|
|
(224
|
)
|
||||
Proceeds from finance obligations
|
—
|
|
|
—
|
|
|
—
|
|
|
5,325
|
|
||||
Payments on finance obligations
|
—
|
|
|
(1,622
|
)
|
|
(13,694
|
)
|
|
(2,731
|
)
|
||||
Proceeds from long-term debt
|
—
|
|
|
—
|
|
|
40,000
|
|
|
12,621
|
|
||||
Payments on long-term debt
|
(40,000
|
)
|
|
(469
|
)
|
|
(85,297
|
)
|
|
(469
|
)
|
||||
Payments of preferred dividends
|
—
|
|
|
—
|
|
|
(109
|
)
|
|
—
|
|
||||
Proceeds from exercise of stock options
|
—
|
|
|
654
|
|
|
10
|
|
|
1,473
|
|
||||
Proceeds from rights offering, net of offering costs
|
—
|
|
|
—
|
|
|
—
|
|
|
7,591
|
|
||||
Proceeds from issuance and exercise of stock warrants
|
50,587
|
|
|
—
|
|
|
157,049
|
|
|
—
|
|
||||
Proceeds from security token offering, net of offering costs
|
78,442
|
|
|
—
|
|
|
79,347
|
|
|
—
|
|
||||
Purchase of treasury stock
|
—
|
|
|
(10,000
|
)
|
|
—
|
|
|
(10,000
|
)
|
||||
Payments of taxes withheld upon vesting of restricted stock
|
(4,526
|
)
|
|
(1,085
|
)
|
|
(4,670
|
)
|
|
(1,323
|
)
|
||||
Payment of debt issuance costs
|
—
|
|
|
(251
|
)
|
|
(419
|
)
|
|
(251
|
)
|
||||
Net cash provided by (used in) financing activities
|
84,255
|
|
|
(12,773
|
)
|
|
170,351
|
|
|
12,012
|
|
||||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(50,974
|
)
|
|
(79,033
|
)
|
|
48,201
|
|
|
(18,528
|
)
|
||||
Cash, cash equivalents and restricted cash, beginning of period
|
203,670
|
|
|
183,528
|
|
|
104,495
|
|
|
123,023
|
|
||||
Cash, cash equivalents and restricted cash, end of period
|
$
|
152,696
|
|
|
$
|
104,495
|
|
|
$
|
152,696
|
|
|
$
|
104,495
|
|
|
Six months ended
June 30, |
|
Twelve months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash paid during the period:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest paid, net of amounts capitalized
|
$
|
1,113
|
|
|
$
|
1,308
|
|
|
$
|
2,745
|
|
|
$
|
2,238
|
|
Income taxes paid, net of refunds
|
7
|
|
|
183
|
|
|
311
|
|
|
977
|
|
||||
Non-cash investing and financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed assets, including internal-use software and website development, costs financed through accounts payable and accrued liabilities
|
$
|
735
|
|
|
$
|
690
|
|
|
$
|
735
|
|
|
$
|
690
|
|
Equipment acquired under capital lease obligations
|
—
|
|
|
—
|
|
|
1,421
|
|
|
—
|
|
||||
Capitalized interest cost
|
—
|
|
|
—
|
|
|
—
|
|
|
27
|
|
||||
Change in fair value of cash flow hedge
|
—
|
|
|
(100
|
)
|
|
(1,638
|
)
|
|
(3,044
|
)
|
||||
Note receivable converted to equity investment
|
200
|
|
|
869
|
|
|
699
|
|
|
3,719
|
|
||||
Acquisition of assets through stock issuance
|
2,930
|
|
|
—
|
|
|
2,930
|
|
|
—
|
|
•
|
Level 1
—Quoted prices for identical instruments in active markets;
|
•
|
Level 2
—Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
|
•
|
Level 3
—Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
p
|
Fair Value Measurements at June 30, 2018:
|
||||||||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash equivalents - Money market mutual funds
|
$
|
31,188
|
|
|
$
|
31,188
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Investments in equity securities, at fair value
|
4,336
|
|
|
4,336
|
|
|
—
|
|
|
—
|
|
||||
Trading securities held in a "rabbi trust" (1)
|
83
|
|
|
83
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
35,607
|
|
|
$
|
35,607
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Deferred compensation accrual "rabbi trust" (2)
|
$
|
90
|
|
|
$
|
90
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total liabilities
|
$
|
90
|
|
|
$
|
90
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
— Trading securities held in a rabbi trust are included in Prepaids and other current assets and Other long-term assets, net in our consolidated balance sheets.
|
(2)
|
— Non-qualified deferred compensation in a rabbi trust is included in Accrued liabilities and Other long-term liabilities in our consolidated balance sheets.
|
|
Life
(years)
|
Building
|
40
|
Land improvements
|
20
|
Building machinery and equipment
|
15-20
|
Furniture and equipment
|
5-7
|
Computer hardware
|
3-4
|
Computer software, including internal-use software and website development
|
2-4
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Cost of goods sold - direct
|
$
|
83
|
|
|
$
|
75
|
|
|
$
|
167
|
|
|
$
|
158
|
|
Technology
|
5,296
|
|
|
6,177
|
|
|
10,772
|
|
|
12,862
|
|
||||
General and administrative
|
1,023
|
|
|
959
|
|
|
2,044
|
|
|
1,889
|
|
||||
Total depreciation, including internal-use software and website development
|
$
|
6,402
|
|
|
$
|
7,211
|
|
|
$
|
12,983
|
|
|
$
|
14,909
|
|
|
June 30,
2018 |
|
December 31,
2017 |
||||
Intangible assets subject to amortization, gross (1)
|
$
|
28,004
|
|
|
$
|
17,779
|
|
Less: accumulated amortization of intangible assets subject to amortization
|
(12,494
|
)
|
|
(10,442
|
)
|
||
Intangible assets subject to amortization, net
|
15,510
|
|
|
7,337
|
|
||
Intangible assets not subject to amortization
|
10,833
|
|
|
—
|
|
||
Total intangible assets, net
|
$
|
26,343
|
|
|
$
|
7,337
|
|
(1)
|
— At
June 30, 2018
, the weighted average remaining useful life for intangible assets subject to amortization, excluding fully amortized intangible assets, was
5.70
years.
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Technology
|
$
|
895
|
|
|
$
|
905
|
|
|
$
|
1,650
|
|
|
$
|
1,810
|
|
Sales and marketing
|
204
|
|
|
20
|
|
|
323
|
|
|
40
|
|
||||
General and administrative
|
34
|
|
|
21
|
|
|
78
|
|
|
41
|
|
||||
Total amortization
|
$
|
1,133
|
|
|
$
|
946
|
|
|
$
|
2,051
|
|
|
$
|
1,891
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||||||
Total revenue, net
|
$
|
483,133
|
|
|
100
|
%
|
|
$
|
432,024
|
|
|
100
|
%
|
|
$
|
928,464
|
|
|
100
|
%
|
|
$
|
864,459
|
|
|
100
|
%
|
Cost of goods sold
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Product costs and other cost of goods sold
|
371,841
|
|
|
77
|
%
|
|
329,346
|
|
|
76
|
%
|
|
705,361
|
|
|
76
|
%
|
|
656,150
|
|
|
76
|
%
|
||||
Fulfillment and related costs
|
19,549
|
|
|
4
|
%
|
|
18,507
|
|
|
4
|
%
|
|
37,491
|
|
|
4
|
%
|
|
37,231
|
|
|
4
|
%
|
||||
Total cost of goods sold
|
391,390
|
|
|
81
|
%
|
|
347,853
|
|
|
81
|
%
|
|
742,852
|
|
|
80
|
%
|
|
693,381
|
|
|
80
|
%
|
||||
Gross profit
|
$
|
91,743
|
|
|
19
|
%
|
|
$
|
84,171
|
|
|
19
|
%
|
|
$
|
185,612
|
|
|
20
|
%
|
|
$
|
171,078
|
|
|
20
|
%
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net loss attributable to stockholders of Overstock.com, Inc.
|
$
|
(64,911
|
)
|
|
$
|
(7,499
|
)
|
|
$
|
(115,820
|
)
|
|
$
|
(13,402
|
)
|
Less: Preferred stock dividends - declared and accumulated
|
27
|
|
|
27
|
|
|
53
|
|
|
55
|
|
||||
Undistributed loss
|
(64,938
|
)
|
|
(7,526
|
)
|
|
(115,873
|
)
|
|
(13,457
|
)
|
||||
Less: Undistributed loss allocated to participating securities
|
(1,495
|
)
|
|
(204
|
)
|
|
(2,683
|
)
|
|
(364
|
)
|
||||
Net loss attributable to common shares
|
$
|
(63,443
|
)
|
|
$
|
(7,322
|
)
|
|
$
|
(113,190
|
)
|
|
$
|
(13,093
|
)
|
Net loss per common share—basic:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss attributable to common shares—basic
|
$
|
(2.20
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(3.94
|
)
|
|
$
|
(0.52
|
)
|
Weighted average common shares outstanding—basic
|
28,903
|
|
|
24,996
|
|
|
28,736
|
|
|
25,035
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Stock options and restricted stock awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Weighted average common shares outstanding—diluted
|
28,903
|
|
|
24,996
|
|
|
28,736
|
|
|
25,035
|
|
||||
Net loss attributable to common shares—diluted
|
$
|
(2.20
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(3.94
|
)
|
|
$
|
(0.52
|
)
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Stock options and restricted stock units
|
550
|
|
|
103
|
|
|
617
|
|
|
151
|
|
Common shares issuable under stock warrant
|
—
|
|
|
—
|
|
|
42
|
|
|
—
|
|
Purchase Price
|
Fair Value
|
||
Cash paid, net of cash acquired
|
$
|
11,769
|
|
Allocation
|
|
||
Intangibles
|
$
|
7,400
|
|
Goodwill
|
7,360
|
|
|
Other assets acquired
|
3
|
|
|
Other liabilities assumed
|
(179
|
)
|
|
Total net assets, net of cash acquired
|
14,584
|
|
|
Less: noncontrolling interest
|
(2,815
|
)
|
|
Total net assets attributable to tZERO, net of cash acquired
|
$
|
11,769
|
|
Intangible Assets
|
Fair Value
|
|
Estimated Useful Life (in years)
|
||
Technology and developed software
|
$
|
6,300
|
|
|
10
|
Trade name
|
700
|
|
|
10
|
|
Customer relationships
|
400
|
|
|
0.5
|
|
Total acquired intangible assets at the acquisition date
|
7,400
|
|
|
|
|
Less: accumulated amortization of acquired intangible assets
|
(313
|
)
|
|
|
|
Total acquired intangible assets, net
|
$
|
7,087
|
|
|
|
Purchase Price
|
Fair Value
|
||
Cash paid, net of cash acquired
|
$
|
1,143
|
|
Allocation
|
|
||
Accounts receivable, net
|
$
|
399
|
|
Inventories, net
|
1,772
|
|
|
Prepaids and other current assets
|
29
|
|
|
Fixed assets
|
154
|
|
|
Intangibles
|
2,763
|
|
|
Accounts payable
|
(682
|
)
|
|
Accrued liabilities
|
(223
|
)
|
|
Long-term debt, net
|
(3,069
|
)
|
|
Total net assets, net of cash acquired
|
$
|
1,143
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Total revenue
|
$
|
485,152
|
|
|
$
|
435,987
|
|
|
$
|
932,537
|
|
|
$
|
872,056
|
|
Consolidated net loss
|
$
|
(67,218
|
)
|
|
$
|
(7,514
|
)
|
|
$
|
(122,336
|
)
|
|
$
|
(13,694
|
)
|
|
June 30,
2018 |
|
December 31,
2017 |
||||
Accrued marketing expenses
|
$
|
42,311
|
|
|
$
|
25,959
|
|
Accounts payable accruals
|
19,847
|
|
|
16,614
|
|
||
Allowance for returns
|
15,539
|
|
|
17,391
|
|
||
Other accrued expenses
|
14,110
|
|
|
6,283
|
|
||
Accrued compensation and other related costs
|
12,814
|
|
|
10,716
|
|
||
Accrued freight
|
4,470
|
|
|
5,040
|
|
||
Accrued loss contingencies
|
641
|
|
|
608
|
|
||
Total accrued liabilities
|
$
|
109,732
|
|
|
$
|
82,611
|
|
Payments due by period
|
|
|
||
2018 (Remainder)
|
|
$
|
3,525
|
|
2019
|
|
6,819
|
|
|
2020
|
|
4,379
|
|
|
2021
|
|
4,355
|
|
|
2022
|
|
4,439
|
|
|
Thereafter
|
|
16,356
|
|
|
|
|
$
|
39,873
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Overstock restricted stock awards
|
$
|
2,700
|
|
|
$
|
1,045
|
|
|
$
|
5,084
|
|
|
$
|
1,985
|
|
Medici Ventures stock options
|
123
|
|
|
—
|
|
|
134
|
|
|
—
|
|
||||
tZERO equity awards
|
150
|
|
|
—
|
|
|
4,190
|
|
|
—
|
|
||||
Total stock-based compensation expense
|
$
|
2,973
|
|
|
$
|
1,045
|
|
|
$
|
9,408
|
|
|
$
|
1,985
|
|
|
Six months ended
June 30, 2018 |
|||||
|
Units
|
|
Weighted
Average Grant Date Fair Value |
|||
Outstanding—beginning of year
|
540
|
|
|
$
|
17.05
|
|
Granted at fair value
|
346
|
|
|
70.06
|
|
|
Vested
|
(222
|
)
|
|
17.30
|
|
|
Forfeited
|
(12
|
)
|
|
47.76
|
|
|
Outstanding—end of period
|
652
|
|
|
$
|
44.53
|
|
|
Three months ended
June 30, |
||||||||||||||||||
|
Direct
|
|
Partner
|
|
Retail Total
|
|
Other
|
|
Total
|
||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Revenue, net
|
$
|
14,715
|
|
|
$
|
462,968
|
|
|
$
|
477,683
|
|
|
$
|
5,450
|
|
|
$
|
483,133
|
|
Cost of goods sold
|
14,672
|
|
|
372,580
|
|
|
387,252
|
|
|
4,138
|
|
|
391,390
|
|
|||||
Gross profit
|
$
|
43
|
|
|
$
|
90,388
|
|
|
$
|
90,431
|
|
|
$
|
1,312
|
|
|
$
|
91,743
|
|
Operating expenses
|
|
|
|
|
|
|
149,437
|
|
|
8,842
|
|
|
158,279
|
|
|||||
Interest and other income (expense), net (1)
|
|
|
|
|
|
|
1,624
|
|
|
(1,031
|
)
|
|
593
|
|
|||||
Pre-tax loss
|
|
|
|
|
(57,382
|
)
|
|
(8,561
|
)
|
|
(65,943
|
)
|
|||||||
Provision for (benefit from) income taxes
|
|
|
|
|
|
|
(40
|
)
|
|
13
|
|
|
(27
|
)
|
|||||
Net loss (2)
|
|
|
|
|
|
|
$
|
(57,342
|
)
|
|
$
|
(8,574
|
)
|
|
$
|
(65,916
|
)
|
||
|
|
|
|
|
|
|
|
|
|
||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Revenue, net
|
$
|
22,099
|
|
|
$
|
405,856
|
|
|
$
|
427,955
|
|
|
$
|
4,069
|
|
|
$
|
432,024
|
|
Cost of goods sold
|
21,147
|
|
|
323,892
|
|
|
345,039
|
|
|
2,814
|
|
|
347,853
|
|
|||||
Gross profit
|
$
|
952
|
|
|
$
|
81,964
|
|
|
$
|
82,916
|
|
|
$
|
1,255
|
|
|
$
|
84,171
|
|
Operating expenses
|
|
|
|
|
|
|
89,325
|
|
|
4,577
|
|
|
93,902
|
|
|||||
Interest and other income, net (1)
|
|
|
|
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|||||
Pre-tax loss
|
|
|
|
|
(6,396
|
)
|
|
(3,322
|
)
|
|
(9,718
|
)
|
|||||||
Benefit from income taxes
|
|
|
|
|
|
|
(176
|
)
|
|
(1,799
|
)
|
|
(1,975
|
)
|
|||||
Net loss (2)
|
|
|
|
|
|
|
$
|
(6,220
|
)
|
|
$
|
(1,523
|
)
|
|
$
|
(7,743
|
)
|
|
Six months ended
June 30, |
||||||||||||||||||
|
Direct
|
|
Partner
|
|
Retail Total
|
|
Other
|
|
Total
|
||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Revenue, net
|
$
|
30,985
|
|
|
$
|
886,694
|
|
|
$
|
917,679
|
|
|
$
|
10,785
|
|
|
$
|
928,464
|
|
Cost of goods sold
|
29,444
|
|
|
705,388
|
|
|
734,832
|
|
|
8,020
|
|
|
742,852
|
|
|||||
Gross profit
|
$
|
1,541
|
|
|
$
|
181,306
|
|
|
$
|
182,847
|
|
|
$
|
2,765
|
|
|
$
|
185,612
|
|
Operating expenses
|
|
|
|
|
|
|
274,969
|
|
|
31,573
|
|
|
306,542
|
|
|||||
Interest and other income (expense), net (1)
|
|
|
|
|
|
|
1,169
|
|
|
(915
|
)
|
|
254
|
|
|||||
Pre-tax loss
|
|
|
|
|
(90,953
|
)
|
|
(29,723
|
)
|
|
(120,676
|
)
|
|||||||
Benefit from income taxes
|
|
|
|
|
|
|
(128
|
)
|
|
(176
|
)
|
|
(304
|
)
|
|||||
Net loss (2)
|
|
|
|
|
|
|
$
|
(90,825
|
)
|
|
$
|
(29,547
|
)
|
|
$
|
(120,372
|
)
|
||
|
|
|
|
|
|
|
|
|
|
||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Revenue, net
|
$
|
44,927
|
|
|
$
|
811,117
|
|
|
$
|
856,044
|
|
|
$
|
8,415
|
|
|
$
|
864,459
|
|
Cost of goods sold
|
42,110
|
|
|
645,189
|
|
|
687,299
|
|
|
6,082
|
|
|
693,381
|
|
|||||
Gross profit
|
$
|
2,817
|
|
|
$
|
165,928
|
|
|
$
|
168,745
|
|
|
$
|
2,333
|
|
|
$
|
171,078
|
|
Operating expenses
|
|
|
|
|
|
|
173,863
|
|
|
9,259
|
|
|
183,122
|
|
|||||
Interest and other income (expense), net (1)
|
|
|
|
|
|
|
115
|
|
|
(4,411
|
)
|
|
(4,296
|
)
|
|||||
Pre-tax loss
|
|
|
|
|
(5,003
|
)
|
|
(11,337
|
)
|
|
(16,340
|
)
|
|||||||
Provision for (benefit from) income taxes
|
|
|
|
|
|
|
713
|
|
|
(3,028
|
)
|
|
(2,315
|
)
|
|||||
Net loss (2)
|
|
|
|
|
|
|
$
|
(5,716
|
)
|
|
$
|
(8,309
|
)
|
|
$
|
(14,025
|
)
|
(1)
|
— Excludes intercompany transactions eliminated in consolidation, which consist primarily of service fees and interest. The net amounts of these intercompany transactions were
$504,000
and
$359,000
for the
three months
|
(2)
|
— Net income (loss) presented for segment reporting purposes is before any adjustments attributable to noncontrolling interests.
|
•
|
our strategies and plans for our e-commerce business and our Medici businesses, including our tZERO initiatives;
|
•
|
the possibility that we will pursue or attempt to pursue a strategic alternative that could change our business dramatically, including the possibility and potential effects of a sale of our e-commerce business, as well as the possibility that we will determine not to pursue any strategic alternative at all in the foreseeable future;
|
•
|
our expectation that if we sell our e-commerce business for cash and retain the after-tax proceeds of the sale, we would return a significant portion of the after-tax proceeds to our stockholders within 12 months after any such sale, by means of a stock repurchase program, dividend, one or more issuer tender offers or other means;
|
•
|
all statements of our expectations regarding the "Capital on Demand" Sales Agreement or the Standby Equity Underwriting Agreement we have entered into with JonesTrading Institutional Services LLC, including any statement about our ability to raise capital pursuant to either such agreement;
|
•
|
our expectations regarding the effects on us of the recent Tax Cuts and Jobs Act;
|
•
|
our expectations regarding the costs, benefits and risks of Medici Ventures’ efforts to develop blockchain applications and tZERO’s efforts to develop financial technology (“fintech”) applications, including applications using blockchain technology and how effectively that technology will be adopted, and including our expectations regarding the costs, benefits and risks of the operations of tZERO;
|
•
|
all statements regarding the plans of tZERO or Medici Ventures;
|
•
|
our expectations regarding the costs, benefits and risks of tZERO’s ownership of SpeedRoute and PRO Securities, each of which is a registered broker dealer;
|
•
|
our expectations regarding the costs, benefits and risks of having less than wholly-owned subsidiaries, including our indirect approximately 80% owned subsidiary tZERO and our currently wholly-owned subsidiary Medici Ventures, which has issued stock options to employees and consequently may not be wholly-owned in the future;
|
•
|
all statements regarding the tZERO security token offering, including the possibility that the proceeds of the security token offering might be treated as income to us for federal income tax purposes, and might be treated as a liability rather than equity for accounting purposes;
|
•
|
our expectations regarding the costs, benefits and risks of our efforts and plans to advertise or offer financial product and services offerings on our website, including discount stock brokerage trading services, automated investment advisory services, accredited investor verification services, and other financial service offerings and other businesses, innovations and projects that we or our subsidiaries may engage in, offer or advertise in the future;
|
•
|
our expectations regarding Medici Ventures’ efforts to create a system to help areas of the world that lack reliable widely-recognized land-titling and record-keeping processes implement blockchain-based systems for doing so;
|
•
|
our plans to modify our branding and marketing strategy;
|
•
|
our beliefs regarding our ability to attract and retain customers in a cost-efficient manner;
|
•
|
the anticipated effectiveness of or potential improvements in our marketing;
|
•
|
our future operating and financial results, including any projections of revenue, profits or losses, contribution, technology expense, general and administrative expense, cash flow, capital expenditures or other financial measures or amounts or non-GAAP financial measures or amounts or anticipated changes in any of them;
|
•
|
our beliefs and expectations regarding the adequacy of our facilities, including leased and any third-party operated warehouse facilities, as well as the possibility that we may add distribution centers or other distribution facilities to our distribution system and our expectations regarding the results of any such additions;
|
•
|
our future capital requirements and our ability to satisfy our capital needs;
|
•
|
the adequacy of our liquidity and our ability, if any, to increase our liquidity or capital resources through traditional capital raising or otherwise;
|
•
|
any possibility that tZERO may repay a portion of the amounts we have advanced to tZERO, or that we may accept tZERO Security Tokens to be issued by tZERO in satisfaction of a portion of such amounts;
|
•
|
tZERO’s plans, including without limitation its plans to develop its Token Trading System and all statements about tZERO's plans and expectations regarding tZERO's joint venture with Box Digital;
|
•
|
whether the Token Trading System will be able to comply with SEC rules and regulations;
|
•
|
our plans and expectations regarding the costs, benefits, and risks of attempting to develop technology applications including applications using or relating to blockchain technology and our plans to commercialize any of these potential applications;
|
•
|
the competition we currently face and anticipate;
|
•
|
the effects of current and future government regulation;
|
•
|
our expectations for our international sales efforts;
|
•
|
our efforts to provide multi-channel fulfillment services;
|
•
|
our plans for further changes to our business;
|
•
|
our expectations and beliefs regarding our ability to effectively change business strategies, including by increasing or decreasing our e-commerce branding and marketing expenditures;
|
•
|
our beliefs regarding current or future litigation or regulatory actions or fines, including our expectations regarding the investigation the Division of Enforcement of the Securities and Exchange Commission is conducting and its request that we voluntarily provide certain information and documents related to tZERO and the tZERO security token offering;
|
•
|
our beliefs and expectations regarding existing and future tax laws and related laws and the application of those laws to our business including the results of tax assessments we receive periodically;
|
•
|
our beliefs regarding the adequacy of our insurance coverage;
|
•
|
our beliefs regarding the adequacy and anticipated functionality of our infrastructure, including our backup facilities and beliefs regarding the adequacy of our disaster planning and our ability to recover from a disaster or other interruption of our ability to operate our Website;
|
•
|
our beliefs regarding our cybersecurity efforts and measures and our efforts to prevent data breaches and the costs we will incur in our ongoing efforts to avoid interruptions to our product offerings and other business processes from cyber-attacks and from data breaches;
|
•
|
our ability to maintain or improve upon customer service levels that we and our customers consider acceptable;
|
•
|
our beliefs regarding the adequacy of our order processing systems and our fulfillment and distribution capabilities;
|
•
|
our belief that we and our partners will be able to maintain inventory levels at appropriate levels despite the seasonal nature of our business and the rapid changes we encounter in customer demand for various products;
|
•
|
our expectations regarding our emphasis on home and garden product offerings;
|
•
|
our belief that we can successfully offer and sell a constantly changing mix of products and services; and
|
•
|
our other statements about the anticipated benefits and risks of our business and plans.
|
•
|
any changes we may make to our business as a result of our current ongoing review of potential strategic alternatives, which could involve a sale of our e-commerce business, additional equity or debt financings, or other significant changes to our business;
|
•
|
the possibility that we may sell our e-commerce business for cash and retain some or all of the after-tax proceeds of the sale for use in our blockchain initiatives, which would result in our stockholders owning equity interests in a publicly-held corporation seeking to develop entirely new businesses and revenue streams, without the benefits of our current e-commerce business and the approximately $1.7 billion it generates in annual net revenues but with most if not all of the expenses of operating a publicly-held corporation;
|
•
|
the potentially substantial corporate level income tax expense we could incur if we were to sell our e-commerce business in a taxable transaction;
|
•
|
the possibility that our publicly-disclosed review of potential strategic alternatives may distract our management and other employees, may cause members of our management and/or other employees to seek employment elsewhere, and may have adverse effects on our business and financial results;
|
•
|
the technical, operational, financial, regulatory, legal, reputational, marketing and other obstacles we face in trying to create a profitable business with significant revenues from our blockchain initiatives;
|
•
|
the possibility that we will be unable to raise the capital we anticipate raising pursuant to the "Capital on Demand" Sales Agreement or the Standby Equity Underwriting Agreement we have entered into with JonesTrading Institutional Services LLC;
|
•
|
the possibility that the recent Tax Cuts and Jobs Act will have adverse effects on us in addition to those we have already identified;
|
•
|
the possibility that the proceeds of the tZERO security token offering might be treated as income to us for federal income tax purposes;
|
•
|
the possibility that the tZERO security token offering could result in claims against tZERO and/or us;
|
•
|
the effects of changes we have recently made and expect to make in the near future to the amount of our sales and marketing expenditures, which could continue to have an adverse effect on our near-term financial results as they did in the first half of 2018;
|
•
|
the costs of, and difficulties we have encountered and may continue to encounter with, the implementation of our strategies for our e-commerce business;
|
•
|
the possibility that we may be unable to fund our plans for our planned sales and marketing activities, new distribution facilities, our technology platforms, our Club O rewards program, our private label strategy, and other initiatives;
|
•
|
the efficiency of our e-commerce marketing and its effect on our business strategy;
|
•
|
the cost and availability of online and traditional advertising, and the results of our various brand building and marketing campaigns;
|
•
|
difficulties we have encountered and continue to encounter with our natural search results;
|
•
|
increasing competition, including competition from well-established competitors including Amazon.com, competition from competitors based in China or in other relatively low-cost jurisdictions, competition from well-funded companies, including Wayfair, and from others including Amazon and other competitors with business
|
•
|
difficulties we may encounter in connection with our efforts to offer services to our customers outside of our e-commerce business, including the credit, insurance, discount brokerage trading services, automated investment advisory services, and accredited investor verification services we advertise or offer;
|
•
|
difficulties, including expense and any operational or regulatory issues we may encounter in connection with tZERO or its subsidiaries, including its two registered broker-dealers, SpeedRoute and PRO Securities;
|
•
|
technical, operational, regulatory or other difficulties we may encounter with our Medici or tZERO blockchain or financial technology initiatives, including difficulties we or tZERO may have marketing any products or services tZERO may offer, whether due to lack of market size or acceptance or as a result of competition from any of the numerous competitors seeking to develop competing technologies or systems or as a result of patents that may be granted to other companies or persons; and losses we may continue to incur in connection with our Medici and tZERO blockchain and financial technology initiatives;
|
•
|
the possibility that blockchain technology may be adopted more slowly than we anticipate;
|
•
|
the fact that tZERO necessarily allocates its limited resources among the projects it is pursuing, and at present has re-allocated developers from working on its DLR Software to working on other projects;
|
•
|
the difficulties tZERO will face in attempting to market its DLR Software, and the possibility that we and/or tZERO have overestimated the demand for, and/or the size of the intended market for the DLR Software or may face regulatory issues related to the DLR Software;
|
•
|
the substantial technical, operational, financial, regulatory, legal, marketing and other obstacles to tZERO’s plans to create and launch a U.S. national exchange with regulatory approval to trade security tokens, including any difficulties tZERO may have with its joint venture with Box Digital;
|
•
|
the difficulties tZERO will face in attempting to generate revenues from blockchain-based applications of any nature;
|
•
|
Medici Ventures’ current business model of providing the services of its developers at Medici Ventures’ cost to companies in which Medici Ventures owns an interest;
|
•
|
any difficulties we may have with the interests in other companies that we or Medici Ventures or tZERO may own or acquire in the future, including any impairment we may recognize with respect to any of them;
|
•
|
the substantial obstacles Medici Ventures faces in connection with its efforts to create a system to help areas of the world that lack reliable widely-recognized land-titling and record-keeping processes implement blockchain-based systems for doing so, including the substantial difficulties it may encounter with persons who benefit from existing locally-recognized systems currently in use in many places;
|
•
|
any liability or expense we may incur as a result of our interests in other companies, whether as a result of regulatory issues or otherwise;
|
•
|
the current downturn in portions of the U.S. housing market, which at least one article published in late July 2018 by a nationally-recognized online news service said “appears to be headed for the broadest slowdown in years,” and any broader or deeper downturn in the U.S. housing market or other changes in U.S. and global economic conditions or U.S. consumer spending;
|
•
|
the effects of recent tariffs or the imposition of additional tariffs or occurrence of other events or circumstances that increase the price of importing into the U.S. the types of merchandise we sell in our e-commerce business or make it more difficult to import or obtain such merchandise;
|
•
|
our failure to maintain our existing relationships with our fulfillment partners or build new relationships with fulfillment partners on acceptable terms;
|
•
|
our failure to maintain optimal levels of product quality, quantity and assortment or to attract sufficient consumer interest in our product offerings;
|
•
|
any claims we may face regarding the quality, safety or labelling of the products we offer;
|
•
|
modifications we may make to our business model from time to time, including aspects relating to our product mix and the mix of direct/partner sourcing of the products we offer, and difficulties we may encounter as a result of our efforts to change various aspects of our business model frequently and rapidly;
|
•
|
the mix of products purchased by our customers and changes to that mix;
|
•
|
any claims we may face regarding cyber security issues or data breaches or difficulties we encounter regarding Internet or other infrastructure or communications impairment problems or the costs of preventing or responding to any such problems;
|
•
|
any problems with or affecting our payment card processors, including cyber-attacks, Internet or other infrastructure or communications impairment or other events that could interrupt the normal operation of the payment card processors or any difficulties we may have maintaining compliance with the rules of the payment card processors;
|
•
|
the recent substantial decrease in our liquidity, and any additional substantial decrease in our liquidity, whether as a result of our business operations or as a result of the expenses or results of governmental inquiries or investigations or litigation or other claims against us, and the possibility that we will be unable to obtain financing or any other source of liquidity adequate to enable us to continue our operations;
|
•
|
problems with or affecting the facility where substantially all of our computer and communications hardware is located or other problems that result in the unavailability of our Website or reduced performance of our transaction systems;
|
•
|
any liabilities that may be asserted against us for not having collected sales tax in jurisdictions in which we did not do so;
|
•
|
any losses or issues we may encounter as a consequence of accepting or holding bitcoin or other cryptocurrencies, whether as a result of regulatory, tax or other legal issues, technological issues, value fluctuations, lack of widespread adoption of bitcoin or other cryptocurrencies as an acceptable medium of exchange or otherwise;
|
•
|
difficulties we may have in responding to technological changes;
|
•
|
losses we may incur due to fraud or our inability to prevent or limit fraud;
|
•
|
claims or other problems we may encounter as a result of the listing or sale on our Website of pirated, counterfeit or illegal items;
|
•
|
any environmental liabilities we may incur relating to the real estate owned by one of our wholly-owned subsidiaries and on which our corporate headquarters is located;
|
•
|
any failure of any of our product or service offerings outside of our main shopping Website offerings to provide the benefits we expect from them;
|
•
|
any difficulties we may encounter as a result of our reliance on numerous third parties that we do not control for the performance of critical functions material to our business;
|
•
|
any difficulties we may encounter in connection with the rapid shift of e-commerce and online payments to mobile and multi-channel commerce and payments;
|
•
|
our inability to increase market share or revenue in accordance with our plans;
|
•
|
additional difficulties we may have with our efforts to increase our revenues at an acceptable cost in accordance with our plans and to return to profitability;
|
•
|
difficulties we may encounter in connection with our efforts to emphasize our home and garden product offerings and to brand ourselves as a home and garden shopping destination, including the risk that our sales of home and garden product offerings could decrease substantially as a result of a significant downturn in some or all of the U.S. housing market;
|
•
|
fluctuations in our operating results;
|
•
|
difficulties we may encounter in connection with our efforts to expand internationally, including claims we may face and liabilities we may incur in connection with those efforts;
|
•
|
adverse results in legal proceedings, investigations or other claims, and costs we may incur in connection with any of them, including the costs of responding to the investigation the Division of Enforcement of the Securities and Exchange Commission is conducting;
|
•
|
any difficulties we may have optimizing our warehouse operations;
|
•
|
the risks of inventory management and seasonality, particularly with inventory subject to rapid price declines;
|
•
|
any decrease in the rate of growth of e-commerce, particularly in home goods, and the occurrence of any event that would adversely affect e-commerce or discourage or prevent consumers from shopping online or via mobile apps;
|
•
|
the possibility that we will suffer adverse consequences as a result of one or more of the related party transactions we have entered into or other related party transactions that we may enter into in the future; and
|
•
|
the other risks described in this report or in our other public filings.
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
|
|
(as a percentage of total net
revenue)
|
|
(as a percentage of total net
revenue)
|
||||||||
Revenue, net
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct
|
|
3.0
|
%
|
|
5.1
|
%
|
|
3.3
|
%
|
|
5.2
|
%
|
Partner and other
|
|
97.0
|
|
|
94.9
|
|
|
96.7
|
|
|
94.8
|
|
Total net revenue
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
Cost of goods sold
|
|
|
|
|
|
|
|
|
||||
Direct
|
|
3.0
|
|
|
4.9
|
|
|
3.2
|
|
|
4.9
|
|
Partner and other
|
|
78.0
|
|
|
75.6
|
|
|
76.8
|
|
|
75.3
|
|
Total cost of goods sold
|
|
81.0
|
|
|
80.5
|
|
|
80.0
|
|
|
80.2
|
|
Gross profit
|
|
19.0
|
|
|
19.5
|
|
|
20.0
|
|
|
19.8
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
||||
Sales and marketing
|
|
19.5
|
|
|
10.0
|
|
|
18.5
|
|
|
9.4
|
|
Technology
|
|
6.7
|
|
|
6.5
|
|
|
6.9
|
|
|
6.6
|
|
General and administrative
|
|
6.5
|
|
|
5.2
|
|
|
7.7
|
|
|
5.2
|
|
Total operating expenses
|
|
32.8
|
|
|
21.7
|
|
|
33.0
|
|
|
21.2
|
|
Operating loss
|
|
(13.8
|
)
|
|
(2.3
|
)
|
|
(13.0
|
)
|
|
(1.4
|
)
|
Other income (expense), net
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
(0.5
|
)
|
Loss before income taxes
|
|
(13.6
|
)
|
|
(2.2
|
)
|
|
(13.0
|
)
|
|
(1.9
|
)
|
Benefit from income taxes
|
|
—
|
|
|
(0.5
|
)
|
|
—
|
|
|
(0.3
|
)
|
Consolidated net loss
|
|
(13.6
|
)%
|
|
(1.8
|
)%
|
|
(13.0
|
)%
|
|
(1.6
|
)%
|
|
|
Three months ended
June 30, |
|
|
|
|
|
Six months ended
June 30, |
|
|
|
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Revenue, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Direct
|
|
$
|
14,715
|
|
|
$
|
22,099
|
|
|
$
|
(7,384
|
)
|
|
(33.4
|
)%
|
|
$
|
30,985
|
|
|
$
|
44,927
|
|
|
$
|
(13,942
|
)
|
|
(31.0
|
)%
|
Partner and other
|
|
468,418
|
|
|
409,925
|
|
|
58,493
|
|
|
14.3
|
|
|
897,479
|
|
|
819,532
|
|
|
77,947
|
|
|
9.5
|
|
||||||
Total revenue, net
|
|
$
|
483,133
|
|
|
$
|
432,024
|
|
|
$
|
51,109
|
|
|
11.8
|
%
|
|
$
|
928,464
|
|
|
$
|
864,459
|
|
|
$
|
64,005
|
|
|
7.4
|
%
|
|
|
Three Months Ended
June 30, 2018 |
||||||
Change in the Estimate of Average Transit Times (Days)
|
|
Increase (Decrease)
Revenue
|
|
Increase (Decrease)
Pre-Tax Income
|
||||
2
|
|
$
|
(18,689
|
)
|
|
$
|
(2,017
|
)
|
1
|
|
$
|
(7,553
|
)
|
|
$
|
(818
|
)
|
As reported
|
|
As reported
|
|
|
As reported
|
|
||
-1
|
|
$
|
6,193
|
|
|
$
|
676
|
|
-2
|
|
$
|
11,749
|
|
|
$
|
1,278
|
|
|
|
Three months ended
June 30, |
|
|
|
|
|
Six months ended
June 30, |
|
|
|
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Revenue, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Direct
|
|
$
|
14,715
|
|
|
$
|
22,099
|
|
|
$
|
(7,384
|
)
|
|
(33.4
|
)%
|
|
$
|
30,985
|
|
|
$
|
44,927
|
|
|
$
|
(13,942
|
)
|
|
(31.0
|
)%
|
Partner and other
|
|
468,418
|
|
|
409,925
|
|
|
58,493
|
|
|
14.3
|
|
|
897,479
|
|
|
819,532
|
|
|
77,947
|
|
|
9.5
|
|
||||||
Total net revenue
|
|
$
|
483,133
|
|
|
$
|
432,024
|
|
|
$
|
51,109
|
|
|
11.8
|
%
|
|
$
|
928,464
|
|
|
$
|
864,459
|
|
|
$
|
64,005
|
|
|
7.4
|
%
|
Cost of goods sold
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Direct
|
|
$
|
14,672
|
|
|
$
|
21,147
|
|
|
$
|
(6,475
|
)
|
|
(30.6
|
)%
|
|
$
|
29,444
|
|
|
$
|
42,110
|
|
|
$
|
(12,666
|
)
|
|
(30.1
|
)%
|
Partner and other
|
|
376,718
|
|
|
326,706
|
|
|
50,012
|
|
|
15.3
|
|
|
713,408
|
|
|
651,271
|
|
|
62,137
|
|
|
9.5
|
|
||||||
Total cost of goods sold
|
|
$
|
391,390
|
|
|
$
|
347,853
|
|
|
$
|
43,537
|
|
|
12.5
|
%
|
|
$
|
742,852
|
|
|
$
|
693,381
|
|
|
$
|
49,471
|
|
|
7.1
|
%
|
Gross Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Direct
|
|
$
|
43
|
|
|
$
|
952
|
|
|
$
|
(909
|
)
|
|
(95.5
|
)%
|
|
$
|
1,541
|
|
|
$
|
2,817
|
|
|
$
|
(1,276
|
)
|
|
(45.3
|
)%
|
Partner and other
|
|
91,700
|
|
|
83,219
|
|
|
8,481
|
|
|
10.2
|
|
|
184,071
|
|
|
168,261
|
|
|
15,810
|
|
|
9.4
|
|
||||||
Total gross profit
|
|
$
|
91,743
|
|
|
$
|
84,171
|
|
|
$
|
7,572
|
|
|
9.0
|
%
|
|
$
|
185,612
|
|
|
$
|
171,078
|
|
|
$
|
14,534
|
|
|
8.5
|
%
|
|
|
Q1 2017
|
|
Q2 2017
|
|
Q3 2017
|
|
Q4 2017
|
|
FY 2017
|
|
Q1 2018
|
|
Q2 2018
|
|||||||
Direct
|
|
8.2
|
%
|
|
4.3
|
%
|
|
0.3
|
%
|
|
(2.3
|
)%
|
|
3.0
|
%
|
|
9.2
|
%
|
|
0.3
|
%
|
Partner and other
|
|
20.8
|
%
|
|
20.3
|
%
|
|
20.7
|
%
|
|
19.7
|
%
|
|
20.3
|
%
|
|
21.5
|
%
|
|
19.6
|
%
|
Combined
|
|
20.1
|
%
|
|
19.5
|
%
|
|
19.7
|
%
|
|
18.8
|
%
|
|
19.5
|
%
|
|
21.1
|
%
|
|
19.0
|
%
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||
Total revenue, net
|
$
|
483,133
|
|
|
100%
|
|
$
|
432,024
|
|
|
100%
|
|
$
|
928,464
|
|
|
100%
|
|
$
|
864,459
|
|
|
100%
|
Cost of goods sold
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Product costs and other cost of goods sold
|
371,841
|
|
|
77%
|
|
329,346
|
|
|
76%
|
|
705,361
|
|
|
76%
|
|
656,150
|
|
|
76%
|
||||
Fulfillment and related costs
|
19,549
|
|
|
4%
|
|
18,507
|
|
|
4%
|
|
37,491
|
|
|
4%
|
|
37,231
|
|
|
4%
|
||||
Total cost of goods sold
|
391,390
|
|
|
81%
|
|
347,853
|
|
|
81%
|
|
742,852
|
|
|
80%
|
|
693,381
|
|
|
80%
|
||||
Gross profit
|
$
|
91,743
|
|
|
19%
|
|
$
|
84,171
|
|
|
19%
|
|
$
|
185,612
|
|
|
20%
|
|
$
|
171,078
|
|
|
20%
|
|
|
Three months ended
June 30, |
|
|
|
|
|
Six months ended
June 30, |
|
|
|
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Sales and marketing expenses
|
|
$
|
94,416
|
|
|
$
|
43,297
|
|
|
$
|
51,119
|
|
|
118.1
|
%
|
|
$
|
171,630
|
|
|
$
|
80,915
|
|
|
$
|
90,715
|
|
|
112.1
|
%
|
Sales and marketing expenses as a percent of net revenues
|
|
19.5
|
%
|
|
10.0
|
%
|
|
|
|
|
|
|
|
18.5
|
%
|
|
9.4
|
%
|
|
|
|
|
|
|
Three months ended
June 30, |
|
|
|
|
|
Six months ended
June 30, |
|
|
|
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
Technology expenses
|
|
$
|
32,423
|
|
|
$
|
28,244
|
|
|
$
|
4,179
|
|
|
14.8
|
%
|
|
$
|
63,717
|
|
|
$
|
57,236
|
|
|
$
|
6,481
|
|
|
11.3
|
%
|
Technology expenses as a percent of net revenues
|
|
6.7
|
%
|
|
6.5
|
%
|
|
|
|
|
|
|
|
6.9
|
%
|
|
6.6
|
%
|
|
|
|
|
|
|
|
|
Three months ended
June 30, |
|
|
|
|
|
Six months ended
June 30, |
|
|
|
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||||||||||
General and administrative expenses
|
|
$
|
31,440
|
|
|
$
|
22,361
|
|
|
$
|
9,079
|
|
|
40.6
|
%
|
|
$
|
71,195
|
|
|
$
|
44,971
|
|
|
$
|
26,224
|
|
|
58.3
|
%
|
General and administrative expenses as a percent of net revenues
|
|
6.5
|
%
|
|
5.2
|
%
|
|
|
|
|
|
|
|
7.7
|
%
|
|
5.2
|
%
|
|
|
|
|
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Cost of goods sold - direct
|
$
|
83
|
|
|
$
|
75
|
|
|
$
|
167
|
|
|
$
|
158
|
|
Technology
|
5,296
|
|
|
6,177
|
|
|
10,772
|
|
|
12,862
|
|
||||
General and administrative
|
1,023
|
|
|
959
|
|
|
2,044
|
|
|
1,889
|
|
||||
Total depreciation, including internal-use software and website development
|
$
|
6,402
|
|
|
$
|
7,211
|
|
|
$
|
12,983
|
|
|
$
|
14,909
|
|
|
Three months ended
June 30, |
|
Six months ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2017
|
|
2016
|
||||||||
Technology
|
$
|
895
|
|
|
$
|
905
|
|
|
$
|
1,650
|
|
|
$
|
1,810
|
|
Sales and marketing
|
204
|
|
|
20
|
|
|
323
|
|
|
40
|
|
||||
General and administrative
|
34
|
|
|
21
|
|
|
78
|
|
|
41
|
|
||||
Total amortization of intangible assets other than goodwill
|
$
|
1,133
|
|
|
$
|
946
|
|
|
$
|
2,051
|
|
|
$
|
1,891
|
|
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
2018
|
|
$
|
445,331
|
|
|
$
|
483,134
|
|
|
$
|
N/A
|
|
|
$
|
N/A
|
|
2017
|
|
|
432,435
|
|
|
|
432,024
|
|
|
|
424,007
|
|
|
|
456,290
|
|
2016
|
|
|
413,677
|
|
|
|
418,540
|
|
|
|
441,564
|
|
|
|
526,182
|
|
|
|
Six months ended
June 30, |
|
Twelve months ended
June 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Cash provided by (used in):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating activities
|
|
$
|
(70,579
|
)
|
|
$
|
(46,257
|
)
|
|
$
|
(59,543
|
)
|
|
$
|
20,262
|
|
Investing activities
|
|
(64,650
|
)
|
|
(20,003
|
)
|
|
(62,607
|
)
|
|
(50,802
|
)
|
||||
Financing activities
|
|
84,255
|
|
|
(12,773
|
)
|
|
170,351
|
|
|
12,012
|
|
|
|
Payments Due by Period
|
||||||||||||||||||||||||||
Contractual Obligations
|
|
Remainder of 2018
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
Thereafter
|
|
Total
|
||||||||||||||
Operating leases
|
|
3,525
|
|
|
6,819
|
|
|
4,379
|
|
|
4,355
|
|
|
4,439
|
|
|
16,356
|
|
|
39,873
|
|
|||||||
Purchase obligations
|
|
4,772
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,772
|
|
|||||||
Technology services
|
|
1,016
|
|
|
2,031
|
|
|
1,693
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,740
|
|
|||||||
High Bench Senior Credit Agreement
|
|
—
|
|
|
—
|
|
|
3,069
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,069
|
|
|||||||
Total contractual cash obligations
|
|
$
|
9,313
|
|
|
$
|
8,850
|
|
|
$
|
9,141
|
|
|
$
|
4,355
|
|
|
$
|
4,439
|
|
|
$
|
16,356
|
|
|
$
|
52,454
|
|
|
|
Six months ended
June 30, |
|
Twelve months ended
June 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net cash (used in) provided by operating activities
|
|
$
|
(70,579
|
)
|
|
$
|
(46,257
|
)
|
|
$
|
(59,543
|
)
|
|
$
|
20,262
|
|
Expenditures for fixed assets, including internal-use software and website development
|
|
(12,749
|
)
|
|
(16,450
|
)
|
|
(19,885
|
)
|
|
(45,883
|
)
|
||||
Free cash flow
|
|
$
|
(83,328
|
)
|
|
$
|
(62,707
|
)
|
|
$
|
(79,428
|
)
|
|
$
|
(25,621
|
)
|
•
|
online retailers with or without discount departments, including Amazon.com, AliExpress (part of the Alibaba Group), eBay, and Rakuten.com (formerly Buy.com);
|
•
|
online shopping services, including Google Express;
|
•
|
online specialty retailers such as Blue Nile, Bluefly, Houzz, Jet.com, Wayfair, Zappos.com, and Zulily;
|
•
|
furniture specialists including Ashley Furniture, Bob's Discount Furniture, Havertys, Raymour & Flanigan and Rooms To Go;
|
•
|
traditional general merchandise and specialty retailers and liquidators including Barnes and Noble, Bed, Bath & Beyond, Best Buy, Costco, Crate and Barrel, Ethan Allen, Gilt, Home Depot, HomeGoods, Hudson's Bay Company, IKEA, J.C. Penney Company, Kirkland's, Kohl's, Lands' End, Lowe's, Macy's, Nordstrom, Pier 1 Imports, Pottery Barn, Restoration Hardware, Ross Stores, Saks Fifth Avenue, Sears, T.J. Maxx, Target, Wal-Mart, and Williams-Sonoma, all of which also have an online presence; and
|
•
|
liquidation e-tailers such as SmartBargains.
|
(a)
|
|
Exhibits
|
|
|
|
|
10.1
(a)
|
|
|
|
|
*10.2
(a)
|
|
|
|
|
10.3
(a)(b)(c)
|
|
|
|
|
*10.4
(a)
|
|
|
|
|
*10.5
(a)
|
|
|
|
|
*31.1
|
|
|
|
|
*31.2
|
|
|
|
|
*32.1
|
|
|
|
|
*32.2
|
|
|
|
|
101
|
|
Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income (Loss), (iv) Consolidated Statements of Cash Flows, (v) Consolidated Statements of Stockholders' Equity, and (vi) Notes to Consolidated Financial Statements.
|
Date:
|
August 9, 2018
|
OVERSTOCK.COM, INC.
|
|
|
|
|
|
/s/ GREGORY J. IVERSON
|
|
|
Gregory J. Iverson
|
|
|
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
|
Optionee:
|
Saum Noursalehi
|
Type of Grant:
|
Nonstatutory Stock Option
|
Date of Grant:
|
May 21, 2018
|
Vesting Commencement Date:
|
May 21, 2018
|
Number of Shares Subject to Option:
|
200
|
Option Exercise Price (Per Share):
|
$27,502
|
Total Exercise Price:
|
$5,500,400
|
Expiration Date:
|
May 20, 2028
|
t0.com, Inc.
|
|
Optionee:
|
||
By:
|
/s/ PATRICK M. BYRNE
|
|
By:
|
/s/ SAUM NOURSALEHI
|
|
Signature
|
|
|
Signature
|
Name:
|
Patrick M. Byrne
|
|
Name:
|
Saum Noursalehi
|
Title:
|
Executive Chairman
|
|
Date:
|
6/5/2018
|
Date:
|
6/5/2018
|
|
|
|
(i)
|
For Officers, Directors and Consultants: six (6) months;
|
(ii)
|
For other Employees: four (4) months;
|
Medical
|
Prepaid Legal Services
|
Dental
|
Basic Life and AD&D- Company Paid
|
Vision
|
Short/Long Term Disability- Company Paid
|
Supplemental Life and AD&D
|
Employee Assistance Program (EAP)- Company Paid
|
Voluntary Accident, Critical illness, Hospital Indemnity
|
Employee Wellness
|
Flexible Spending Accounts (FSA)
|
Club O Gold
|
Health Savings Account (HSA)
|
|
Contribution Type
|
Age requirement
|
Service Requirement
|
Entry Date
|
Traditional 401(k) and Roth 401(k)
|
21
|
1 month(s)
|
First day of each month
|
/s/ GREGORY J. IVERSON
|
4/1/2018
|
Gregory Iverson
|
Date
|
Date:
|
August 9, 2018
|
/s/ PATRICK M. BYRNE
|
|
|
Patrick M. Byrne
|
|
|
Chief Executive Officer
|
|
|
(principal executive officer)
|
Date:
|
August 9, 2018
|
/s/ GREGORY J. IVERSON
|
|
|
Gregory J. Iverson
|
|
|
Chief Financial Officer
|
|
|
(principal financial officer)
|
Date:
|
August 9, 2018
|
/s/ PATRICK M. BYRNE
|
|
|
Patrick M. Byrne
|
|
|
Chief Executive Officer
|
|
|
(principal executive officer)
|
Date:
|
August 9, 2018
|
/s/ GREGORY J. IVERSON
|
|
|
Gregory J. Iverson
|
|
|
Chief Financial Officer
|
|
|
(principal financial officer)
|