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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Delaware
(State of incorporation)
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06‑1594540
(IRS Employer Identification No.)
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Title of each class
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Name of each exchange on which registered
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Common Stock, par value $.0001 par value
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The Nasdaq Stock Market, LLC
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Large accelerated filer
¨
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Accelerated filer
x
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Non‑accelerated filer
¨
(Do not check if a
smaller reporting company)
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Smaller reporting company
¨
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Emerging growth company
¨
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Item
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Page No.
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•
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In certain cases, the Company entered into a license agreement as part of settling prior intellectual property infringement claims against an acquired entity and/or its selling parent company and affiliates. Historically, the Company had recognized these license fees separately as revenue. However, the Company has determined to net these license fees against the consideration paid as part of the acquisitions, resulting in a reduction of the goodwill and/or intangible assets recorded in purchase accounting.
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•
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The Company’s consolidated joint venture Zentry LLC (“Zentry”) and the Company’s partner in that joint venture entered into a license agreement in December 2015 at the same time as the formation of the joint venture. Historically, the Company
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•
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The Company entered into a licensing agreement in December 2016 with Sequential Technology International, LLC (“STIN”) shortly after closing the divestiture of its activation business to Sequential Technology International Holdings, LLC (“STIH”). Historically, the Company recorded the license fees as revenue separately from the accounting for the divestiture. The Company has determined to classify these license fees as additional gain on sale of the activation exception handling business.
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•
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The Company made adjustments to reduce the contingent consideration payable to shareholders of Razorsight Corporation (“Razorsight”), which was acquired by the Company in August 2015, and the related losses previously recorded to adjust that liability to fair value, as a result of the determination that many of the sales of Razorsight software that had originally been included in the earn-out calculation have now been adjusted as part of the restatement.
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•
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The Company made adjustments to record the fair value of the Company’s guarantee of certain of STIN’s debt as part of the divestiture of its activation exception handling business to STIH in December 2016, to record the sellers note extended in the transaction at fair value, and to adjust certain receivables and other assets sold in the transaction.
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•
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The Company made certain adjustments to the opening balances of Openwave Messaging, Inc. (“Openwave”) and SNCR, LLC (“SNCR, LLC”); impacting deferred revenue, goodwill and intangibles. Adjustments in deferred revenue and intangibles were reported post-acquisition as revenues and costs were realized.
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Core Offers:
Six modules allowing for service and product order capture and transaction processing may include: Order Manager, Orchestration Gateway, Work Flow Manager, Front End Portals, Visibility Manager, Product Catalogue
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Add-on Offers:
Ten modules that are available to extend new functionality around value-added services as needed may include: Fraud Verification, Inbound Call Tracking Manager, Notification Manager, Visibility Manager, Interactive Voice Response (“IVR”) and Information and Communication Technology (“ICT”) Managers, Dynamic Work Queue Manager, Catalogue Manager, Bulk Order Process Manager, Identity Manager, Call to order capture manager
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Service-Based Offers:
Operations work and program management services may include: Operation and Call Center Management, Sales Delivery and Program Management
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Custom Development:
Value added applications for Enterprise and Consumers such as sales portals can be added to the Activation Platform to facilitate catalogue management, point of sale, customer self-care, and inventory management
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Create new revenue streams and enable monetization of data assets
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Optimize network investments while maximizing margin and customer value
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Accurately measure campaign and program effectiveness across channels such as mobile, digital, care and retail
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Target prospects for acquisition more effectively and efficiently - improving customer retention and satisfaction
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Sales & Marketing:
helps companies better target and refine promotional campaigns, improving key performance indicators (“KPI’s”) in customer acquisition and retention.
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Customer Experience:
helps companies refine the effectiveness of digital customer experiences analyzing user responses, patterns and fail points to create better execution of products and services.
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Financial Assurance:
is a comprehensive procurement-to-payment application suite that helps companies manage network expense and automate workflow, inventory management and governance.
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IoT:
connects previously disparate data from M2M devices to create actionable insights and productized services for companies operating IoT solutions.
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P2P Advanced Messaging Client:
Advanced Messaging supports an advanced P2P client based on RCS and RTC technologies with compelling data (chat), voice, group and video communication features. Our RCS/RTC client opens up new means of conversation providing richer communications, viral distribution via subscribers and provides new gateways for commerce that Short Message Service (“SMS”) cannot provide.
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A2P Messaging Commerce:
Our A2P solutions are an end-to-end set of capabilities to help Operators, TMT companies and third party brands establish an AI-driven dialogue with subscribers and consumers. The Advanced Messaging platform aggregates chat bot engines, software development kits (“SDK’s”) and API’s exposing these tools to third party brands. This functions as an onboarding environment for chat bots, merchandising and advertising to function within a messaging environment. The platform collects user engagement data and through analytics powered dashboards, optimizing bot performance via campaign monitoring that ties into downstream third party customer relationship management (“CRM”) operations.
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Bulk activation by OEMs for manufacturer funded introductory Wireless service.
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Registration of device/vehicle owners and contact information by the dealer when a car is sold.
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Reminders (email) are sent to device/vehicle owners as introductory period ends.
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Support for a catalog of carrier (AT&T Wireless) plans and services.
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Activation of new/changed plans and services.
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Transfer of integrated circuit card identifier (“ICCID”) from one device owner to another.
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Status queries (
e.g.
, is ICCID active, on what Vehicle Identification Number, introductory or upgraded)
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A variety of tools and services to support Customer Care use cases.
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Financial Services: Capital markets, banking and insurance.
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Healthcare: Providers and payers
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Life Sciences: Pharmaceuticals, device manufacturers and clinical research organizations
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Secure Mobility Management: a BYOD implementation that provides the rich integration and orchestration of secure mobile productivity software featuring fine grain activity capture and dynamic policy execution through best in class mobility management, security and policy management tools and intelligent productivity through behavioral analytics
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Data & Analytics: solution which support fraud and cyber security detection/prevention, dynamic policy administration/execution and predictive productivity
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Identity and Access Management: solution that allows customers to self-register and verify their identity while providing non-intrusive multi factor authentication and enables businesses to allow them to be sure the consumer is the correct person doing authorized to conduct the transaction.
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Breadth and depth of our transaction and content management solutions, including our exception handling technology
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Carrier grade nature and scalability of our solutions
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Quality and performance of our products
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High-quality customer service
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Ability to implement and integrate solutions
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Overall value of our platforms
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References of our customers
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OTT Providers: Cloud - iCloud, Google Photos, Dropbox, Funambol; Messaging - Line, WeChat, Facebook Messenger, iMessage, Jibe, Mavenir
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Consulting/Service Integrators: Accenture, Ernst & Young, Deloitte, Amdocs, Ericsson
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Internal resources - IT resources for CSP and MSO customers who have internal projects that replicate Synchronoss product scope
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impairing our ability to invest in and successfully grow our business and make acquisitions;
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making it more difficult for us to satisfy our obligations with respect to our indebtedness, which could result in an event of default under the agreement governing the 2019 Notes;
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limiting our ability to obtain additional financing on satisfactory terms to fund our working capital requirements, capital expenditures, acquisitions, debt obligations and other general corporate requirements;
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hindering our ability to raise equity capital, because, in the event of a liquidation of our business, debt holders have priority over equity holders;
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increasing our vulnerability to general economic downturns, competition and industry conditions, which could place us at a competitive disadvantage compared to competitors that are less leveraged and are therefore we may be unable to take advantage of opportunities that our leverage prevents us from exploiting;
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imposing additional restrictions on the manner in which we conduct our business, including restrictions on our ability to pay dividends, incur additional debt and sell assets; and
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placing us at a possible disadvantage relative to less leveraged competitors and competitors that have better access to capital resources.
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recruiting, training and retaining technical, finance, marketing and management personnel with the knowledge, skills and experience that our business model requires;
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maintaining high levels of customer satisfaction;
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developing and improving our internal administrative infrastructure, particularly our financial, operational, communications and other internal systems;
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preserving our culture, values and entrepreneurial environment; and
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effectively managing our personnel and operations and effectively communicating to our personnel worldwide our core values, strategies and goals.
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damage to, or failure of, our computer software or hardware or our connections and outsourced service arrangements with third parties;
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errors in the processing of data by our systems;
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computer viruses or software defects;
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physical or electronic break-ins, sabotage, intentional acts of vandalism and similar events;
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fire, cybersecurity attack, terrorist attack or other catastrophic event;
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increased capacity demands or changes in systems requirements of our customers; or
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errors by our employees or third-party service providers.
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loss of customers and market share;
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difficulty attracting or the inability to attract new customers, including in new geographic regions; and
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increased service and support costs and a diversion of resources.
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damage to our reputation;
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loss of or delayed revenue;
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loss of customers;
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warranty claims or litigation;
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loss of or delayed market acceptance of our services; or
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unexpected expenses and diversion of resources to remedy errors.
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diversion of management’s attention from other operational matters;
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inability to identify acquisition candidates on terms acceptable to us or at all, or inability to complete acquisitions as anticipated or at all;
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inability to realize anticipated benefits or commercialize purchased technologies;
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exposure to operational risks, rules and regulations to the extent such activities are located in countries where we have not historically done business;
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unknown, underestimated and/or undisclosed commitments or liabilities;
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incurrence of debt, contingent liabilities or future write-offs of intangible assets or goodwill;
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dilution of ownership of our current stockholders if we issue shares of our common stock;
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higher than expected transaction costs; and
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ineffective integration of operations, technologies, products or employees of the acquired companies.
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Foreign currency exchange rates;
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Political or social unrest;
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Economic instability or weakness or natural disasters in a specific country or region, including the current economic challenges in China and global economic ramifications of Chinese economic difficulties; instability as a result of Brexit; environmental and trade protection measures and other legal and regulatory requirements, some of which may affect our ability to import our products, to export our products from, or sell our products in various countries;
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Political considerations that affect service provider and government spending patterns;
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Health or similar issues, such as a pandemic or epidemic;
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Difficulties in staffing and managing international operations; or
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Adverse tax consequences, including imposition of withholding or other taxes on our global operation.
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develop or enhance our products and platforms;
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acquire complementary technologies, products or businesses;
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expand operations, in the United States or internationally; or
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respond to competitive pressures or unanticipated working capital requirements.
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(i)
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certain dividends, repayments and redemptions;
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(ii)
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any amendment to our certificate of incorporation that adversely effects the rights, preferences, privileges or voting powers of the Series A Preferred Stock;
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(iii)
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issuances of stock ranking senior or equivalent to shares of Series A Preferred Stock (including additional shares of Series A Preferred Stock) in the priority of payment of dividends or in the distribution of assets upon any liquidation, dissolution or winding up of us;
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(iv)
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changes in the size of our Board of Directors;
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(v)
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any amendment, alteration, modification or repeal of the charter of our Nominating and Corporate Governance Committee of the Board of Directors and related documents; and
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(vi)
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any change in our principal business or the entry into any line of business outside of our existing lines of businesses.
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authorize the issuance of “blank check” preferred stock that could be issued by our board of directors to thwart a takeover attempt;
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prohibit cumulative voting in the election of directors, which would otherwise allow holders of less than a majority of the stock to elect some directors;
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establish a classified board of directors, as a result of which the successors to the directors whose terms have expired will be elected to serve from the time of election and qualification until the third annual meeting following election;
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require that directors only be removed from office for cause;
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provide that vacancies on the board of directors, including newly-created directorships, may be filled only by a majority vote of directors then in office;
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limit who may call special meetings of stockholders;
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prohibit stockholder action by written consent, requiring all actions to be taken at a meeting of the stockholders; and
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establish advance notice requirements for nominating candidates for election to the board of directors or for proposing matters that can be acted upon by stockholders at stockholder meetings.
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Common Stock
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||||||||||||||
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2017
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2016
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||||||||||||
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High
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Low
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High
|
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Low
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||||||||
First Quarter
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$
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40.28
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$
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23.59
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$
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35.42
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$
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20.33
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Second Quarter
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$
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24.92
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$
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10.11
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$
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37.98
|
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$
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28.73
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Third Quarter
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$
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17.09
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$
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8.71
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$
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43.65
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$
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31.45
|
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Fourth Quarter
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$
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15.69
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$
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8.48
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$
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49.94
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|
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$
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36.00
|
|
|
12/31/12
|
|
12/31/13
|
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12/31/14
|
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12/31/15
|
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12/31/16
|
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12/31/17
|
||||||
Synchronoss Technologies, Inc.
|
100
|
|
|
147
|
|
|
198
|
|
|
167
|
|
|
182
|
|
|
42
|
|
Nasdaq Composite Index
|
100
|
|
|
138
|
|
|
157
|
|
|
166
|
|
|
178
|
|
|
229
|
|
Nasdaq Computer Index
|
100
|
|
|
132
|
|
|
158
|
|
|
168
|
|
|
189
|
|
|
262
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
†
|
|
2014
†
|
|
2013
†
|
||||||||||
|
|
|
|
|
|
|
(Unaudited)
|
||||||||||||
|
|
|
(As Restated)
|
|
(As Restated)
|
|
(As Restated)
|
|
(As Restated)
|
||||||||||
|
(In thousands, except per share data)
|
||||||||||||||||||
Statements of Operations Data:
|
|
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|
||||||||||
Net revenues
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$
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402,361
|
|
|
$
|
426,294
|
|
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$
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372,561
|
|
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$
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233,416
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$
|
215,316
|
|
Loss from continuing operations
|
(129,602
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)
|
|
(122,604
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)
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(37,113
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)
|
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(81,450
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)
|
|
(29,280
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)
|
|||||
Net loss from continuing operations
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(194,224
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)
|
|
(93,869
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)
|
|
(37,782
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)
|
|
(80,557
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)
|
|
(19,686
|
)
|
|||||
Net (loss) income attributable to noncontrolling interests
|
(9,291
|
)
|
|
(15,203
|
)
|
|
(628
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)
|
|
—
|
|
|
—
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|
|||||
Net loss from continuing operations attributable to Synchronoss
|
(184,933
|
)
|
|
(78,666
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)
|
|
(37,154
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)
|
|
(80,557
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)
|
|
(19,686
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)
|
|||||
Net loss applicable to shares of common stock for diluted earnings per share
|
$
|
(184,933
|
)
|
|
$
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(78,666
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)
|
|
$
|
(37,154
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)
|
|
$
|
(80,557
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)
|
|
$
|
(19,686
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)
|
Basic per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
$
|
(4.14
|
)
|
|
$
|
(1.81
|
)
|
|
$
|
(0.88
|
)
|
|
$
|
(1.99
|
)
|
|
$
|
(0.51
|
)
|
Diluted:
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
$
|
(4.14
|
)
|
|
$
|
(1.81
|
)
|
|
$
|
(0.88
|
)
|
|
$
|
(1.99
|
)
|
|
$
|
(0.51
|
)
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
44,669
|
|
|
43,551
|
|
|
42,284
|
|
|
40,418
|
|
|
38,891
|
|
|||||
Diluted
|
44,669
|
|
|
43,551
|
|
|
42,284
|
|
|
40,418
|
|
|
38,891
|
|
†
|
These amounts have been adjusted to exclude discontinued operations for the divestiture of the Company's BPO business in the fourth quarter of 2016. (See
Note 4 - Acquisitions and Divestitures
of the Notes to Consolidated Financial Statements in Part II, Item 8 of this Form 10-K for additional information.)
|
|
As of December 31,
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
|
|
|
|
|
|
|
(Unaudited)
|
||||||||||||
|
|
|
(As Restated)
|
|
(As Restated)
|
|
(As Restated)
|
|
(As Restated)
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents, restricted cash and marketable securities
|
$
|
249,236
|
|
|
$
|
226,913
|
|
|
$
|
233,864
|
|
|
$
|
290,377
|
|
|
$
|
77,605
|
|
Working capital
|
178,493
|
|
|
186,488
|
|
|
265,975
|
|
|
287,938
|
|
|
91,695
|
|
|||||
Total assets
|
965,411
|
|
|
1,054,351
|
|
|
931,562
|
|
|
836,865
|
|
|
520,642
|
|
|||||
Contingent consideration obligation - long term
|
—
|
|
|
—
|
|
|
930
|
|
|
—
|
|
|
4,468
|
|
|||||
Lease financing obligation - long term
|
11,183
|
|
|
12,450
|
|
|
13,391
|
|
|
9,579
|
|
|
10,403
|
|
|||||
Convertible debt, net of debt issuance costs
|
227,704
|
|
|
226,291
|
|
|
224,878
|
|
|
223,465
|
|
|
—
|
|
|||||
Redeemable noncontrolling interest
|
25,280
|
|
|
25,280
|
|
|
25,280
|
|
|
—
|
|
|
—
|
|
|||||
Total stockholders’ equity
|
463,587
|
|
|
529,797
|
|
|
505,323
|
|
|
463,464
|
|
|
436,276
|
|
•
|
In certain cases, the Company entered into a license agreement as part of settling prior intellectual property infringement claims against an acquired entity and/or its selling parent company and affiliates. Historically, the Company had recognized these license fees separately as revenue. However, the Company has determined to net these license fees against the consideration paid as part of the acquisitions, resulting in a reduction of the goodwill and/or intangible assets recorded in purchase accounting.
|
•
|
The Company’s consolidated joint venture Zentry and the Company’s partner in that joint venture entered into a license agreement in December 2015 at the same time as the formation of the joint venture. Historically, the Company recorded the license fees as revenue separately from the Zentry formation. The Company has determined to net these license fees against the cash contributions paid as part of the joint venture formation, resulting in a reduction of the goodwill and intangible assets recorded in purchase accounting.
|
•
|
The Company entered into a licensing agreement in December 2016 with STIN shortly after closing the divestiture of its activation business to STIH. Historically, the Company recorded the license fees as revenue separately from the accounting for the divestiture. The Company has determined to classify these license fees as additional gain on sale of the activation exception handling business.
|
•
|
The Company made adjustments to reduce the contingent consideration payable to shareholders of Razorsight, which was acquired by the Company in August 2015, and the related losses previously recorded to adjust that liability to fair value, as a result of the determination that many of the sales of Razorsight software that had originally been included in the earn-out calculation have now been adjusted as part of the restatement.
|
•
|
The Company made adjustments to record the fair value of the Company’s guarantee of certain of STIN’s debt as part of the divestiture of its activation exception handling business to STIH in December 2016, to record the sellers note extended in the transaction at fair value, and to adjust certain receivables and other assets sold in the transaction.
|
•
|
The Company made certain adjustments to the opening balances of Openwave and SNCR, LLC; impacting deferred revenue, goodwill and intangibles. Adjustments in deferred revenue and intangibles were reported post-acquisition as revenues and costs were realized.
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported **
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Restated
|
||||||||||||||
Net revenues
|
$
|
476,750
|
|
|
$
|
(39,492
|
)
|
|
$
|
9,435
|
|
|
$
|
(20,399
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
426,294
|
|
Loss from continuing operations
|
(71,809
|
)
|
|
(39,647
|
)
|
|
13,905
|
|
|
(6,629
|
)
|
|
(18,424
|
)
|
|
—
|
|
|
(122,604
|
)
|
|||||||
Net (loss) income from continuing operations
|
(66,541
|
)
|
|
(39,647
|
)
|
|
14,158
|
|
|
(7,425
|
)
|
|
(18,669
|
)
|
|
24,255
|
|
|
(93,869
|
)
|
|||||||
Net loss attributable to noncontrolling interests
|
(11,596
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,607
|
)
|
|
—
|
|
|
(15,203
|
)
|
|||||||
Net income (loss) from continuing operations attributable to Synchronoss
|
(54,945
|
)
|
|
(39,647
|
)
|
|
14,158
|
|
|
(7,425
|
)
|
|
(15,062
|
)
|
|
24,255
|
|
|
(78,666
|
)
|
|||||||
Net (loss) income applicable to shares of common stock for diluted earnings per share
|
(54,945
|
)
|
|
(39,647
|
)
|
|
14,158
|
|
|
(7,425
|
)
|
|
(15,062
|
)
|
|
24,255
|
|
|
(78,666
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(1.26
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(1.81
|
)
|
||||||||||
Diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(1.26
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(1.81
|
)
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
43,571
|
|
|
|
|
|
|
|
|
|
|
|
|
43,551
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported **
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Restated
|
||||||||||||||
Net revenues
|
$
|
428,117
|
|
|
$
|
(26,908
|
)
|
|
$
|
1,442
|
|
|
$
|
(30,090
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
372,561
|
|
(Loss) income from continuing operations
|
15,131
|
|
|
(26,908
|
)
|
|
4,484
|
|
|
(30,692
|
)
|
|
872
|
|
|
—
|
|
|
(37,113
|
)
|
|||||||
Net (loss) income from continuing operations
|
6,415
|
|
|
(26,908
|
)
|
|
3,898
|
|
|
(30,708
|
)
|
|
1,175
|
|
|
8,346
|
|
|
(37,782
|
)
|
|||||||
Net income attributable to noncontrolling interests
|
6,052
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,680
|
)
|
|
—
|
|
|
(628
|
)
|
|||||||
Net income (loss) from continuing operations attributable to Synchronoss
|
363
|
|
|
(26,908
|
)
|
|
3,898
|
|
|
(30,708
|
)
|
|
7,855
|
|
|
8,346
|
|
|
(37,154
|
)
|
|||||||
Net (loss) income applicable to shares of common stock for diluted
earnings per share
|
363
|
|
|
(26,908
|
)
|
|
3,898
|
|
|
(30,708
|
)
|
|
7,855
|
|
|
8,346
|
|
|
(37,154
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.88
|
)
|
||||||||||
Diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.88
|
)
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
42,284
|
|
|
|
|
|
|
|
|
|
|
|
|
42,284
|
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported **
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
307,301
|
|
|
$
|
(14,563
|
)
|
|
$
|
(53,322
|
)
|
|
$
|
(6,000
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
233,416
|
|
Loss from continuing operations
|
(3,541
|
)
|
|
(14,563
|
)
|
|
(53,322
|
)
|
|
(5,960
|
)
|
|
(4,064
|
)
|
|
—
|
|
|
(81,450
|
)
|
|||||||
Net (loss) income from continuing operations
|
(2,023
|
)
|
|
(14,563
|
)
|
|
(53,337
|
)
|
|
(5,960
|
)
|
|
(4,674
|
)
|
|
—
|
|
|
(80,557
|
)
|
|||||||
Net income (loss) from continuing operations attributable to Synchronoss
|
(2,023
|
)
|
|
(14,563
|
)
|
|
(53,337
|
)
|
|
(5,960
|
)
|
|
(4,674
|
)
|
|
—
|
|
|
(80,557
|
)
|
|||||||
Net (loss) income applicable to shares of common stock for diluted
earnings per share
|
(2,023
|
)
|
|
(14,563
|
)
|
|
(53,337
|
)
|
|
(5,960
|
)
|
|
(4,674
|
)
|
|
—
|
|
|
(80,557
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.05
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(1.99
|
)
|
||||||||||
Diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.05
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(1.99
|
)
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
40,418
|
|
|
|
|
|
|
|
|
|
|
|
|
40,418
|
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported **
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
225,368
|
|
|
$
|
(5,544
|
)
|
|
$
|
(4,508
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
215,316
|
|
(Loss) income from continuing operations
|
(19,305
|
)
|
|
(5,544
|
)
|
|
(4,508
|
)
|
|
—
|
|
|
77
|
|
|
—
|
|
|
(29,280
|
)
|
|||||||
Net (loss) income from continuing operations
|
(9,711
|
)
|
|
(5,544
|
)
|
|
(4,508
|
)
|
|
—
|
|
|
77
|
|
|
—
|
|
|
(19,686
|
)
|
|||||||
Net income (loss) from continuing operations attributable to Synchronoss
|
(9,711
|
)
|
|
(5,544
|
)
|
|
(4,508
|
)
|
|
—
|
|
|
77
|
|
|
—
|
|
|
(19,686
|
)
|
|||||||
Net (loss) income applicable to shares of common stock for diluted earnings per share
|
(9,711
|
)
|
|
(5,544
|
)
|
|
(4,508
|
)
|
|
—
|
|
|
77
|
|
|
—
|
|
|
(19,686
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.25
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.51
|
)
|
||||||||||
Diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.25
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.51
|
)
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
38,891
|
|
|
|
|
|
|
|
|
|
|
|
|
38,891
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Restated
|
||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash, cash equivalents, restricted cash and marketable securities
|
$
|
226,498
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
415
|
|
|
$
|
—
|
|
|
$
|
226,913
|
|
Working capital
|
210,846
|
|
|
(33,742
|
)
|
|
(41,632
|
)
|
|
20,720
|
|
|
26,913
|
|
|
3,383
|
|
|
186,488
|
|
|||||||
Total assets
|
1,164,729
|
|
|
(344
|
)
|
|
(36,509
|
)
|
|
(67,748
|
)
|
|
(18,003
|
)
|
|
12,226
|
|
|
1,054,351
|
|
|||||||
Lease financing obligation - long term
|
12,121
|
|
|
—
|
|
|
—
|
|
|
41
|
|
|
288
|
|
|
—
|
|
|
12,450
|
|
|||||||
Convertible debt, net of debt issuance costs
|
226,291
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
226,291
|
|
|||||||
Redeemable noncontrolling interest
|
49,856
|
|
|
—
|
|
|
—
|
|
|
(28,813
|
)
|
|
4,237
|
|
|
—
|
|
|
25,280
|
|
|||||||
Total stockholders' equity
|
657,115
|
|
|
(86,707
|
)
|
|
(42,163
|
)
|
|
(27,560
|
)
|
|
(25,741
|
)
|
|
54,853
|
|
|
529,797
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported (Adjusted)
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash, cash equivalents, restricted cash and marketable securities
|
$
|
233,626
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
238
|
|
|
$
|
—
|
|
|
$
|
233,864
|
|
Working capital
|
326,765
|
|
|
(9,293
|
)
|
|
(52,214
|
)
|
|
2,033
|
|
|
(3,470
|
)
|
|
2,154
|
|
|
265,975
|
|
|||||||
Total assets
|
1,010,228
|
|
|
(64
|
)
|
|
(29,251
|
)
|
|
(66,028
|
)
|
|
(188
|
)
|
|
16,865
|
|
|
931,562
|
|
|||||||
Contingent consideration obligation - long term
|
930
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
930
|
|
|||||||
Lease financing obligation - long term
|
13,343
|
|
|
—
|
|
|
—
|
|
|
48
|
|
|
—
|
|
|
—
|
|
|
13,391
|
|
|||||||
Convertible debt, net of debt issuance costs
|
224,878
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
224,878
|
|
|||||||
Redeemable noncontrolling interest
|
61,452
|
|
|
—
|
|
|
—
|
|
|
(29,150
|
)
|
|
(7,022
|
)
|
|
—
|
|
|
25,280
|
|
|||||||
Total stockholders' equity
|
609,814
|
|
|
(47,062
|
)
|
|
(55,793
|
)
|
|
(37,640
|
)
|
|
3,985
|
|
|
32,019
|
|
|
505,323
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
(Unaudited)
|
As Previously Reported (Adjusted)
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash, cash equivalents, restricted cash and marketable securities
|
$
|
290,377
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
290,377
|
|
Working capital
|
354,298
|
|
|
(5,326
|
)
|
|
(58,941
|
)
|
|
—
|
|
|
(4,677
|
)
|
|
2,584
|
|
|
287,938
|
|
|||||||
Total assets
|
862,822
|
|
|
—
|
|
|
(22,041
|
)
|
|
(5,960
|
)
|
|
(7,123
|
)
|
|
9,167
|
|
|
836,865
|
|
|||||||
Lease financing obligation - long term
|
9,204
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
375
|
|
|
—
|
|
|
9,579
|
|
|||||||
Convertible debt, net of debt issuance costs
|
230,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,535
|
)
|
|
—
|
|
|
223,465
|
|
|||||||
Total stockholders' equity
|
529,107
|
|
|
(20,152
|
)
|
|
(60,238
|
)
|
|
(5,960
|
)
|
|
(3,901
|
)
|
|
24,608
|
|
|
463,464
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
(Unaudited)
|
As Previously Reported (Adjusted)
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash, cash equivalents, restricted cash and marketable securities
|
$
|
77,605
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
77,605
|
|
Working capital
|
98,786
|
|
|
(133
|
)
|
|
(7,146
|
)
|
|
—
|
|
|
(1
|
)
|
|
189
|
|
|
91,695
|
|
|||||||
Total assets
|
527,019
|
|
|
—
|
|
|
(4,677
|
)
|
|
—
|
|
|
77
|
|
|
(1,777
|
)
|
|
520,642
|
|
|||||||
Contingent consideration obligation - long term
|
4,468
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,468
|
|
|||||||
Lease financing obligation - long term
|
9,252
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,151
|
|
|
—
|
|
|
10,403
|
|
|||||||
Total stockholders' equity
|
447,639
|
|
|
(5,589
|
)
|
|
(7,146
|
)
|
|
—
|
|
|
76
|
|
|
1,296
|
|
|
436,276
|
|
•
|
In certain cases, the Company entered into a license agreement as part of settling prior intellectual property infringement claims against an acquired entity and/or its selling parent company and affiliates. Historically, the Company had recognized these license fees separately as revenue. However, the Company has determined to net these license fees against the consideration paid as part of the acquisitions, resulting in a reduction of the goodwill and/or intangible assets recorded in purchase accounting.
|
•
|
The Company’s consolidated joint venture Zentry and the Company’s partner in that joint venture entered into a license agreement in December 2015 at the same time as the formation of the joint venture. Historically, the Company recorded the license fees as revenue separately from the Zentry formation. The Company has determined to net these license fees against the cash contributions paid as part of the joint venture formation, resulting in a reduction of the goodwill and intangible assets recorded in purchase accounting.
|
•
|
The Company entered into a licensing agreement in December 2016 with STIN shortly after closing the divestiture of its activation business to STIH. Historically, the Company recorded the license fees as revenue separately from the accounting for the divestiture. The Company has determined to classify these license fees as additional gain on sale of the activation exception handling business.
|
•
|
The Company made adjustments to reduce the contingent consideration payable to shareholders of Razorsight, which was acquired by the Company in August 2015, and the related losses previously recorded to adjust that liability to fair value, as a result of the determination that many of the sales of Razorsight software that had originally been included in the earn-out calculation have now been adjusted as part of the restatement.
|
•
|
The Company made adjustments to record the fair value of the Company’s guarantee of certain of STIN’s debt as part of the divestiture of its activation exception handling business to STIH in December 2016, to record the sellers note extended in the transaction at fair value, and to adjust certain receivables and other assets sold in the transaction.
|
•
|
The Company made certain adjustments to the opening balances of Openwave and SNCR, LLC; impacting deferred revenue, goodwill and intangibles. Adjustments in deferred revenue and intangibles were reported post-acquisition as revenues and costs were realized.
|
|
Year Ended December 31,
|
|
2017 vs 2016
|
|
2016 vs 2015
|
||||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
(in thousands)
|
|
|
(Restated)
|
|
(Restated)
|
|
|
|
|
|
|
|
|
||||||||||||
Net revenues
|
$
|
402,361
|
|
|
$
|
426,294
|
|
|
$
|
372,561
|
|
|
$
|
(23,933
|
)
|
|
(6
|
)%
|
|
$
|
53,733
|
|
|
14
|
%
|
Cost of revenues*
|
181,453
|
|
|
194,684
|
|
|
154,810
|
|
|
(13,231
|
)
|
|
(7
|
)%
|
|
39,874
|
|
|
26
|
%
|
|||||
Research and development
|
90,850
|
|
|
114,493
|
|
|
92,763
|
|
|
(23,643
|
)
|
|
(21
|
)%
|
|
21,730
|
|
|
23
|
%
|
|||||
Selling, general and administrative
|
154,037
|
|
|
126,228
|
|
|
84,591
|
|
|
27,809
|
|
|
22
|
%
|
|
41,637
|
|
|
49
|
%
|
|||||
Net change in contingent consideration obligation
|
—
|
|
|
1,194
|
|
|
1,515
|
|
|
(1,194
|
)
|
|
(100
|
)%
|
|
(321
|
)
|
|
(21
|
)%
|
|||||
Restructuring charges
|
10,739
|
|
|
6,333
|
|
|
4,946
|
|
|
4,406
|
|
|
70
|
%
|
|
1,387
|
|
|
28
|
%
|
|||||
Depreciation and amortization
|
94,884
|
|
|
105,966
|
|
|
71,049
|
|
|
(11,082
|
)
|
|
(10
|
)%
|
|
34,917
|
|
|
49
|
%
|
|||||
Total costs and expenses
|
531,963
|
|
|
548,898
|
|
|
409,674
|
|
|
(16,935
|
)
|
|
(3
|
)%
|
|
139,224
|
|
|
34
|
%
|
|||||
Loss from continuing operations
|
$
|
(129,602
|
)
|
|
$
|
(122,604
|
)
|
|
$
|
(37,113
|
)
|
|
$
|
(6,998
|
)
|
|
6
|
%
|
|
$
|
(85,491
|
)
|
|
230
|
%
|
*
|
Cost of revenues excludes restructuring charges and depreciation and amortization, which are shown separately.
|
|
Three Months Ended March 31,
|
||||||||||
|
2017
|
|
2016
|
|
$ Change
|
||||||
(in thousands)
|
|
|
(Restated)
|
|
|
||||||
Net revenues
|
$
|
86,097
|
|
|
$
|
78,246
|
|
|
$
|
7,851
|
|
Cost of revenues*
|
46,055
|
|
|
46,151
|
|
|
(96
|
)
|
|||
Research and development
|
25,489
|
|
|
25,827
|
|
|
(338
|
)
|
|||
Selling, general and administrative
|
38,815
|
|
|
25,914
|
|
|
12,901
|
|
|||
Net change in contingent consideration obligation
|
—
|
|
|
5
|
|
|
(5
|
)
|
|||
Restructuring charges
|
2,998
|
|
|
2,910
|
|
|
88
|
|
|||
Depreciation and amortization
|
24,087
|
|
|
22,782
|
|
|
1,305
|
|
|||
Total costs and expenses
|
137,444
|
|
|
123,589
|
|
|
13,855
|
|
|||
Loss from continuing operations
|
$
|
(51,347
|
)
|
|
$
|
(45,343
|
)
|
|
$
|
(6,004
|
)
|
*
|
Cost of revenues excludes depreciation and amortization which is shown separately.
|
|
Three Months Ended March 31,
|
||||||||||
|
2016
|
|
2015
|
|
$ Change
|
||||||
(in thousands)
|
(Restated)
|
|
(Restated)
|
|
|
||||||
Net revenues
|
$
|
78,246
|
|
|
$
|
109,641
|
|
|
$
|
(31,395
|
)
|
Cost of revenues*
|
46,151
|
|
|
32,902
|
|
|
13,249
|
|
|||
Research and development
|
25,827
|
|
|
21,953
|
|
|
3,874
|
|
|||
Selling, general and administrative
|
25,914
|
|
|
19,132
|
|
|
6,782
|
|
|||
Net change in contingent consideration obligation
|
5
|
|
|
—
|
|
|
5
|
|
|||
Restructuring charges
|
2,910
|
|
|
3,205
|
|
|
(295
|
)
|
|||
Depreciation and amortization
|
22,782
|
|
|
14,182
|
|
|
8,600
|
|
|||
Total costs and expenses
|
123,589
|
|
|
91,374
|
|
|
32,215
|
|
|||
Loss from continuing operations
|
$
|
(45,343
|
)
|
|
$
|
18,267
|
|
|
$
|
(63,610
|
)
|
*
|
Cost of revenues excludes depreciation and amortization which is shown separately.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||
|
2017
|
|
2016
|
|
$ Change
|
|
2017
|
|
2016
|
|
$ Change
|
||||||||||||
(in thousands)
|
|
|
(Restated)
|
|
|
|
|
|
(Restated)
|
|
|
||||||||||||
Net revenues
|
$
|
118,990
|
|
|
$
|
121,101
|
|
|
$
|
(2,111
|
)
|
|
$
|
205,087
|
|
|
$
|
199,347
|
|
|
$
|
5,740
|
|
Cost of revenues*
|
47,755
|
|
|
48,180
|
|
|
(425
|
)
|
|
93,810
|
|
|
94,331
|
|
|
(521
|
)
|
||||||
Research and development
|
20,819
|
|
|
28,047
|
|
|
(7,228
|
)
|
|
46,308
|
|
|
53,874
|
|
|
(7,566
|
)
|
||||||
Selling, general and administrative
|
29,353
|
|
|
29,880
|
|
|
(527
|
)
|
|
68,168
|
|
|
55,794
|
|
|
12,374
|
|
||||||
Net change in contingent consideration obligation
|
—
|
|
|
3,110
|
|
|
(3,110
|
)
|
|
—
|
|
|
3,115
|
|
|
(3,115
|
)
|
||||||
Restructuring charges
|
6,405
|
|
|
1,139
|
|
|
5,266
|
|
|
9,403
|
|
|
4,049
|
|
|
5,354
|
|
||||||
Depreciation and amortization
|
23,552
|
|
|
24,093
|
|
|
(541
|
)
|
|
47,639
|
|
|
46,875
|
|
|
764
|
|
||||||
Total costs and expenses
|
127,884
|
|
|
134,449
|
|
|
(6,565
|
)
|
|
265,328
|
|
|
258,038
|
|
|
7,290
|
|
||||||
Loss from continuing operations
|
$
|
(8,894
|
)
|
|
$
|
(13,348
|
)
|
|
$
|
4,454
|
|
|
$
|
(60,241
|
)
|
|
$
|
(58,691
|
)
|
|
$
|
(1,550
|
)
|
*
|
Cost of revenues excludes depreciation and amortization which is shown separately.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
$ Change
|
|
2016
|
|
2015
|
|
$ Change
|
||||||||||||
(in thousands)
|
(Restated)
|
|
(Restated)
|
|
|
|
(Restated)
|
|
(Restated)
|
|
|
||||||||||||
Net revenues
|
$
|
121,101
|
|
|
$
|
87,710
|
|
|
$
|
33,391
|
|
|
$
|
199,347
|
|
|
$
|
197,351
|
|
|
$
|
1,996
|
|
Cost of revenues*
|
48,180
|
|
|
35,945
|
|
|
12,235
|
|
|
94,331
|
|
|
68,847
|
|
|
25,484
|
|
||||||
Research and development
|
28,047
|
|
|
22,466
|
|
|
5,581
|
|
|
53,874
|
|
|
44,419
|
|
|
9,455
|
|
||||||
Selling, general and administrative
|
29,880
|
|
|
18,615
|
|
|
11,265
|
|
|
55,794
|
|
|
37,747
|
|
|
18,047
|
|
||||||
Net change in contingent consideration obligation
|
3,110
|
|
|
—
|
|
|
3,110
|
|
|
3,115
|
|
|
—
|
|
|
3,115
|
|
||||||
Restructuring charges
|
1,139
|
|
|
1,416
|
|
|
(277
|
)
|
|
4,049
|
|
|
4,621
|
|
|
(572
|
)
|
||||||
Depreciation and amortization
|
24,093
|
|
|
16,596
|
|
|
7,497
|
|
|
46,875
|
|
|
30,778
|
|
|
16,097
|
|
||||||
Total costs and expenses
|
134,449
|
|
|
95,038
|
|
|
39,411
|
|
|
258,038
|
|
|
186,412
|
|
|
71,626
|
|
||||||
Loss from continuing operations
|
$
|
(13,348
|
)
|
|
$
|
(7,328
|
)
|
|
$
|
(6,020
|
)
|
|
$
|
(58,691
|
)
|
|
$
|
10,939
|
|
|
$
|
(69,630
|
)
|
*
|
Cost of revenues excludes depreciation and amortization which is shown separately.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
|
2017
|
|
2016
|
|
$ Change
|
|
2017
|
|
2016
|
|
$ Change
|
||||||||||||
(in thousands)
|
|
|
(Restated)
|
|
|
|
|
|
(Restated)
|
|
|
||||||||||||
Net revenues
|
$
|
91,015
|
|
|
$
|
119,936
|
|
|
$
|
(28,921
|
)
|
|
$
|
296,102
|
|
|
$
|
319,283
|
|
|
$
|
(23,181
|
)
|
Cost of revenues*
|
45,576
|
|
|
49,139
|
|
|
(3,563
|
)
|
|
139,386
|
|
|
143,470
|
|
|
(4,084
|
)
|
||||||
Research and development
|
20,926
|
|
|
31,030
|
|
|
(10,104
|
)
|
|
67,234
|
|
|
84,904
|
|
|
(17,670
|
)
|
||||||
Selling, general and administrative
|
34,881
|
|
|
28,827
|
|
|
6,054
|
|
|
103,049
|
|
|
84,621
|
|
|
18,428
|
|
||||||
Net change in contingent consideration obligation
|
—
|
|
|
(1,349
|
)
|
|
1,349
|
|
|
—
|
|
|
1,766
|
|
|
(1,766
|
)
|
||||||
Restructuring charges
|
2,312
|
|
|
924
|
|
|
1,388
|
|
|
11,715
|
|
|
4,973
|
|
|
6,742
|
|
||||||
Depreciation and amortization
|
23,459
|
|
|
23,592
|
|
|
(133
|
)
|
|
71,098
|
|
|
70,467
|
|
|
631
|
|
||||||
Total costs and expenses
|
127,154
|
|
|
132,163
|
|
|
(5,009
|
)
|
|
392,482
|
|
|
390,201
|
|
|
2,281
|
|
||||||
Loss from continuing operations
|
$
|
(36,139
|
)
|
|
$
|
(12,227
|
)
|
|
$
|
(23,912
|
)
|
|
$
|
(96,380
|
)
|
|
$
|
(70,918
|
)
|
|
$
|
(25,462
|
)
|
*
|
Cost of revenues excludes depreciation and amortization which is shown separately.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
$ Change
|
|
2016
|
|
2015
|
|
$ Change
|
||||||||||||
(in thousands)
|
(Restated)
|
|
(Restated)
|
|
|
|
(Restated)
|
|
(Restated)
|
|
|
||||||||||||
Net revenues
|
$
|
119,936
|
|
|
$
|
88,747
|
|
|
$
|
31,189
|
|
|
$
|
319,283
|
|
|
$
|
286,098
|
|
|
$
|
33,185
|
|
Cost of revenues*
|
49,139
|
|
|
40,265
|
|
|
8,874
|
|
|
143,470
|
|
|
109,112
|
|
|
34,358
|
|
||||||
Research and development
|
31,030
|
|
|
24,151
|
|
|
6,879
|
|
|
84,904
|
|
|
68,570
|
|
|
16,334
|
|
||||||
Selling, general and administrative
|
28,827
|
|
|
20,339
|
|
|
8,488
|
|
|
84,621
|
|
|
58,086
|
|
|
26,535
|
|
||||||
Net change in contingent consideration obligation
|
(1,349
|
)
|
|
—
|
|
|
(1,349
|
)
|
|
1,766
|
|
|
—
|
|
|
1,766
|
|
||||||
Restructuring charges
|
924
|
|
|
359
|
|
|
565
|
|
|
4,973
|
|
|
4,980
|
|
|
(7
|
)
|
||||||
Depreciation and amortization
|
23,592
|
|
|
19,588
|
|
|
4,004
|
|
|
70,467
|
|
|
50,366
|
|
|
20,101
|
|
||||||
Total costs and expenses
|
132,163
|
|
|
104,702
|
|
|
27,461
|
|
|
390,201
|
|
|
291,114
|
|
|
99,087
|
|
||||||
Loss from continuing operations
|
$
|
(12,227
|
)
|
|
$
|
(15,955
|
)
|
|
$
|
3,728
|
|
|
$
|
(70,918
|
)
|
|
$
|
(5,016
|
)
|
|
$
|
(65,902
|
)
|
*
|
Cost of revenues excludes depreciation and amortization which is shown separately.
|
|
Year ended December 31,
|
|
2017 vs 2016
|
|
2016 vs 2015
|
||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
Change
|
|
Change
|
||||||||||
Net cash provided by (used in):
|
|
|
(Restated)
|
|
(Restated)
|
|
|
|
|
||||||||||
Operating activities
|
$
|
(18,248
|
)
|
|
$
|
104,559
|
|
|
$
|
91,986
|
|
|
$
|
(122,807
|
)
|
|
$
|
12,573
|
|
Investing activities
|
98,245
|
|
|
(39,775
|
)
|
|
(195,080
|
)
|
|
138,020
|
|
|
155,305
|
|
|||||
Financing activities
|
(35,664
|
)
|
|
(370
|
)
|
|
15,349
|
|
|
(35,294
|
)
|
|
(15,719
|
)
|
|
Payments Due by Period
|
||||||||||||||||||
|
|
|
Less Than
|
|
|
|
|
|
More Than
|
||||||||||
|
Total
|
|
1 Year
|
|
1—3 Years
|
|
4—5 Years
|
|
5 Years
|
||||||||||
Capital lease obligations
(1)
|
$
|
15,249
|
|
|
$
|
2,465
|
|
|
$
|
4,347
|
|
|
$
|
2,563
|
|
|
$
|
5,874
|
|
Convertible Senior Notes
(2)
|
230,000
|
|
|
—
|
|
|
230,000
|
|
|
—
|
|
|
—
|
|
|||||
Interest
(3)
|
2,803
|
|
|
1,725
|
|
|
1,078
|
|
|
—
|
|
|
—
|
|
|||||
Operating lease obligations
|
85,339
|
|
|
9,743
|
|
|
19,996
|
|
|
17,908
|
|
|
37,692
|
|
|||||
Purchase obligations
(4)
|
16,875
|
|
|
7,888
|
|
|
8,987
|
|
|
—
|
|
|
—
|
|
|||||
Mandatorily redeemable financial instrument
(5)
|
37,959
|
|
|
37,959
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other long-term liabilities
(6)
|
4,542
|
|
|
3,466
|
|
|
1,076
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
392,767
|
|
|
$
|
63,246
|
|
|
$
|
265,484
|
|
|
$
|
20,471
|
|
|
$
|
43,566
|
|
(1)
|
Amount includes the Pennsylvania facility lease and the VCHS data center.
|
(2)
|
In the event the Company were to become delisted, amounts herein would become due immediately.
|
(3)
|
Represents the interest on the Convertible Senior Notes. If the Company is delisted from Nasdaq, this becomes current.
|
(4)
|
Amount represents obligations associated with colocation agreements and other customer delivery related purchase obligations .
|
(5)
|
Amount represents the Siris Put Right provided to a third-party in relation to the sale of Intralinks in November 2017. See
Note 4 - Acquisitions & Divestitures
for further details.
|
(6)
|
Amount represents unrecognized tax positions recorded in our balance sheet. Although the timing of the settlement is uncertain, we believe this amount will be settled within 3 years.
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
|
|
(Restated)
|
||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
156,299
|
|
|
$
|
169,801
|
|
Restricted cash**
|
89,826
|
|
|
41,632
|
|
||
Marketable securities
|
3,111
|
|
|
12,506
|
|
||
Accounts receivable, net of allowance for doubtful receivables of $3,107 and $1,459 at December 31, 2017 and December 31, 2016, respectively**
|
78,186
|
|
|
107,474
|
|
||
Prepaid and other current assets
|
43,557
|
|
|
38,277
|
|
||
Total current assets
|
370,979
|
|
|
369,690
|
|
||
Marketable securities
|
—
|
|
|
2,974
|
|
||
Property and equipment, net
|
111,825
|
|
|
158,205
|
|
||
Goodwill
|
237,303
|
|
|
224,651
|
|
||
Intangible assets, net
|
132,167
|
|
|
162,968
|
|
||
Deferred tax assets
|
—
|
|
|
13,286
|
|
||
Other assets
|
5,236
|
|
|
8,658
|
|
||
Note receivable from related party, net of allowance for loan losses of $14,562 at December 31, 2017**
|
73,984
|
|
|
70,269
|
|
||
Equity method investment
|
33,917
|
|
|
43,650
|
|
||
Total assets
|
$
|
965,411
|
|
|
$
|
1,054,351
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
5,959
|
|
|
$
|
17,057
|
|
Accrued expenses
|
72,739
|
|
|
76,882
|
|
||
Deferred revenues
|
75,829
|
|
|
57,430
|
|
||
Contingent consideration obligation
|
—
|
|
|
2,833
|
|
||
Short-term debt
|
—
|
|
|
29,000
|
|
||
Mandatorily redeemable financial instrument
|
37,959
|
|
|
—
|
|
||
Total current liabilities
|
192,486
|
|
|
183,202
|
|
||
Lease financing obligation
|
11,183
|
|
|
12,450
|
|
||
Convertible debt, net of debt issuance costs
|
227,704
|
|
|
226,291
|
|
||
Deferred tax liabilities
|
13,735
|
|
|
3,508
|
|
||
Deferred revenues
|
25,241
|
|
|
65,630
|
|
||
Other liabilities
|
6,195
|
|
|
8,193
|
|
||
Commitments and contingencies (Note 10)
|
|
|
|
||||
Redeemable noncontrolling interest
|
25,280
|
|
|
25,280
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock, $0.0001 par value; 100,000 shares authorized, 52,024 and 50,388 shares issued; 46,965 and 45,292 outstanding at December 31, 2017 and December 31, 2016, respectively
|
5
|
|
|
5
|
|
||
Treasury stock, at cost (5,059 and 5,096 shares at December 31, 2017 and December 31, 2016, respectively)
|
(105,584
|
)
|
|
(106,631
|
)
|
||
Additional paid-in capital
|
597,553
|
|
|
571,153
|
|
||
Accumulated other comprehensive loss
|
(23,373
|
)
|
|
(42,350
|
)
|
||
Retained earnings
|
(5,014
|
)
|
|
107,620
|
|
||
Total stockholders’ equity
|
463,587
|
|
|
529,797
|
|
||
Total liabilities and stockholders’ equity
|
$
|
965,411
|
|
|
$
|
1,054,351
|
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
(Restated)
|
|
(Restated)
|
||||||
|
|
|
|
|
|
||||||
Net revenues**
|
$
|
402,361
|
|
|
$
|
426,294
|
|
|
$
|
372,561
|
|
Costs and expenses:
|
|
|
|
|
|
||||||
Cost of revenues*
|
181,453
|
|
|
194,684
|
|
|
154,810
|
|
|||
Research and development
|
90,850
|
|
|
114,493
|
|
|
92,763
|
|
|||
Selling, general and administrative
|
154,037
|
|
|
126,228
|
|
|
84,591
|
|
|||
Net change in contingent consideration obligation
|
—
|
|
|
1,194
|
|
|
1,515
|
|
|||
Restructuring charges
|
10,739
|
|
|
6,333
|
|
|
4,946
|
|
|||
Depreciation and amortization
|
94,884
|
|
|
105,966
|
|
|
71,049
|
|
|||
Total costs and expenses
|
531,963
|
|
|
548,898
|
|
|
409,674
|
|
|||
Loss from continuing operations
|
(129,602
|
)
|
|
(122,604
|
)
|
|
(37,113
|
)
|
|||
Interest income**
|
12,502
|
|
|
1,907
|
|
|
2,047
|
|
|||
Interest expense
|
(55,771
|
)
|
|
(7,414
|
)
|
|
(5,711
|
)
|
|||
Loss on extinguishment of debt
|
(29,413
|
)
|
|
—
|
|
|
—
|
|
|||
Other (expense) income, net
|
(17,678
|
)
|
|
1,022
|
|
|
607
|
|
|||
Equity method investment loss
|
(9,125
|
)
|
|
—
|
|
|
—
|
|
|||
Loss from continuing operations, before taxes
|
(229,087
|
)
|
|
(127,089
|
)
|
|
(40,170
|
)
|
|||
Benefit for income taxes
|
34,863
|
|
|
33,220
|
|
|
2,388
|
|
|||
Net loss from continuing operations
|
(194,224
|
)
|
|
(93,869
|
)
|
|
(37,782
|
)
|
|||
Net income from discontinued operations, net of taxes
|
75,495
|
|
|
90,560
|
|
|
40,267
|
|
|||
Net (loss) income
|
(118,729
|
)
|
|
(3,309
|
)
|
|
2,485
|
|
|||
Net (loss) income attributable to noncontrolling interests
|
(9,291
|
)
|
|
(15,203
|
)
|
|
(628
|
)
|
|||
Net (loss) income attributable to Synchronoss
|
$
|
(109,438
|
)
|
|
$
|
11,894
|
|
|
$
|
3,113
|
|
|
|
|
|
|
|
||||||
Basic †
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
(4.14
|
)
|
|
$
|
(1.81
|
)
|
|
$
|
(0.88
|
)
|
Discontinued operations
|
1.69
|
|
|
2.08
|
|
|
0.95
|
|
|||
|
$
|
(2.45
|
)
|
|
$
|
0.27
|
|
|
$
|
0.07
|
|
Diluted †
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
(4.14
|
)
|
|
$
|
(1.81
|
)
|
|
$
|
(0.88
|
)
|
Discontinued operations
|
1.69
|
|
|
2.08
|
|
|
0.95
|
|
|||
|
$
|
(2.45
|
)
|
|
$
|
0.27
|
|
|
$
|
0.07
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
||||||
Basic †
|
44,669
|
|
|
43,551
|
|
|
42,284
|
|
|||
Diluted †
|
44,669
|
|
|
43,551
|
|
|
42,284
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
**
|
See
Note 6 -Investments in Affiliates and Related Transactions
for related party transactions reflected in this account
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
of the Notes to Consolidated Financial Statements.
|
|
Year Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
(Restated)
|
|
(Restated)
|
||||||
|
|
|
|
|
|
||||||
Net (loss) income
|
$
|
(118,729
|
)
|
|
$
|
(3,309
|
)
|
|
$
|
2,485
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
17,027
|
|
|
(4,114
|
)
|
|
(17,705
|
)
|
|||
Unrealized gain (loss) on securities
|
18
|
|
|
3
|
|
|
(20
|
)
|
|||
Net gain (loss) on intra-entity foreign currency transactions
|
1,932
|
|
|
(725
|
)
|
|
(1,335
|
)
|
|||
Total other comprehensive income (loss), net of tax
|
18,977
|
|
|
(4,836
|
)
|
|
(19,060
|
)
|
|||
Comprehensive loss
|
(99,752
|
)
|
|
(8,145
|
)
|
|
(16,575
|
)
|
|||
Comprehensive (loss) income attributable to redeemable noncontrolling interests
|
(9,291
|
)
|
|
(15,203
|
)
|
|
(628
|
)
|
|||
Total comprehensive (loss) income attributable to Synchronoss
|
(90,461
|
)
|
|
7,058
|
|
|
(15,947
|
)
|
|
|
|
|
|
|
|
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Retained
Earnings
|
|
Total
Stockholders’
Equity
|
||||||||||||||
|
Common Stock
|
|
Treasury Stock
|
|
|
|
|
||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
||||||||||||||||||
Balance at Balance at December 31, 2014, as previously reported
|
46,444
|
|
|
$
|
4
|
|
|
(3,733
|
)
|
|
$
|
(66,336
|
)
|
|
$
|
454,740
|
|
|
$
|
(20,014
|
)
|
|
$
|
160,713
|
|
|
$
|
529,107
|
|
Cumulative restatement adjustments
|
176
|
|
|
—
|
|
|
(159
|
)
|
|
(1,991
|
)
|
|
2,408
|
|
|
1,560
|
|
|
(67,620
|
)
|
|
(65,643
|
)
|
||||||
Balance at January 1, 2015 (As Restated)
|
46,620
|
|
|
$
|
4
|
|
|
(3,892
|
)
|
|
$
|
(68,327
|
)
|
|
$
|
457,148
|
|
|
$
|
(18,454
|
)
|
|
$
|
93,093
|
|
|
$
|
463,464
|
|
Stock based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30,780
|
|
|
—
|
|
|
—
|
|
|
30,780
|
|
||||||
Issuance of restricted stock
|
734
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Issuance of common stock on exercise of options
|
879
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,936
|
|
|
—
|
|
|
—
|
|
|
19,936
|
|
||||||
ESPP compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
624
|
|
|
—
|
|
|
—
|
|
|
624
|
|
||||||
Sale of treasury stock in connection with an employee stock purchase plan
|
54
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,902
|
|
|
—
|
|
|
—
|
|
|
1,902
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
||||||
Adjustments to redemption value of noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(628
|
)
|
|
—
|
|
|
—
|
|
|
(628
|
)
|
||||||
Net income attributable to Synchronoss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,113
|
|
|
3,113
|
|
||||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,060
|
)
|
|
—
|
|
|
(19,060
|
)
|
||||||
Tax benefit from stock option exercise
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,198
|
|
|
—
|
|
|
—
|
|
|
5,198
|
|
||||||
Balance at December 31, 2015 (As Restated)
|
48,287
|
|
|
$
|
4
|
|
|
(3,892
|
)
|
|
$
|
(68,327
|
)
|
|
$
|
514,964
|
|
|
$
|
(37,514
|
)
|
|
$
|
96,202
|
|
|
$
|
505,329
|
|
Cumulative effect of adjustment to retained earnings (ASU Adoption)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
710
|
|
|
—
|
|
|
(476
|
)
|
|
234
|
|
||||||
Stock based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,361
|
|
|
—
|
|
|
—
|
|
|
33,361
|
|
||||||
Issuance of restricted stock
|
585
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Issuance of common stock on exercise of options
|
608
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
13,912
|
|
|
—
|
|
|
—
|
|
|
13,913
|
|
||||||
ESPP compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
817
|
|
|
—
|
|
|
—
|
|
|
817
|
|
||||||
Issuance of common stock related to acquisition
|
840
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,000
|
|
|
—
|
|
|
—
|
|
|
22,000
|
|
||||||
Issuance of common stock to a subsidiary
|
20
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Issuance of common stock to employee stock purchase plan
|
48
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
955
|
|
|
—
|
|
|
—
|
|
|
955
|
|
||||||
Repurchase of treasury shares
|
—
|
|
|
—
|
|
|
(1,262
|
)
|
|
(40,025
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(40,025
|
)
|
||||||
Sale of treasury stock in connection with an employee stock purchase plan
|
—
|
|
|
—
|
|
|
58
|
|
|
1,721
|
|
|
(493
|
)
|
|
—
|
|
|
—
|
|
|
1,228
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
130
|
|
|
—
|
|
|
—
|
|
|
130
|
|
||||||
Adjustments to redemption value of noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,203
|
)
|
|
—
|
|
|
—
|
|
|
(15,203
|
)
|
||||||
Net income attributable to Synchronoss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,894
|
|
|
11,894
|
|
||||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,836
|
)
|
|
—
|
|
|
(4,836
|
)
|
||||||
Balance at December 31, 2016 (As Restated)
|
50,388
|
|
|
$
|
5
|
|
|
(5,096
|
)
|
|
$
|
(106,631
|
)
|
|
$
|
571,153
|
|
|
$
|
(42,350
|
)
|
|
$
|
107,620
|
|
|
$
|
529,797
|
|
|
|
|
|
|
|
|
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Retained
Earnings
|
|
Total
Stockholders’
Equity
|
||||||||||||||
|
Common Stock
|
|
Treasury Stock
|
|
|
|
|
||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
||||||||||||||||||
Balance at December 31, 2016 (As Restated)
|
50,388
|
|
|
$
|
5
|
|
|
(5,096
|
)
|
|
$
|
(106,631
|
)
|
|
$
|
571,153
|
|
|
$
|
(42,350
|
)
|
|
$
|
107,620
|
|
|
$
|
529,797
|
|
Cumulative effect of adjustment to retained earnings (ASU Adoption)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,196
|
)
|
|
(3,196
|
)
|
||||||
Stock based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28,446
|
|
|
—
|
|
|
—
|
|
|
28,446
|
|
||||||
Issuance of restricted stock
|
1,565
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Issuance of common stock on exercise of options
|
104
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,460
|
|
|
—
|
|
|
—
|
|
|
2,460
|
|
||||||
ESPP compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
495
|
|
|
—
|
|
|
—
|
|
|
495
|
|
||||||
Sale of treasury stock in connection with an employee stock purchase plan
|
—
|
|
|
—
|
|
|
36
|
|
|
1,047
|
|
|
|
|
—
|
|
|
—
|
|
|
1,047
|
|
|||||||
Shares withheld for taxes in connection with issuance of restricted stock
|
(29
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(442
|
)
|
|
—
|
|
|
—
|
|
|
(442
|
)
|
||||||
Fair value of awards assumed on acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,701
|
|
|
—
|
|
|
—
|
|
|
4,701
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
31
|
|
|
—
|
|
|
|
|
|
31
|
|
||||||
Adjustments to redemption value of noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,291
|
)
|
|
—
|
|
|
—
|
|
|
(9,291
|
)
|
||||||
Net loss attributable to Synchronoss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(109,438
|
)
|
|
(109,438
|
)
|
||||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
18,977
|
|
|
—
|
|
|
18,977
|
|
||||||
Balance at December 31, 2017
|
52,028
|
|
|
$
|
5
|
|
|
(5,060
|
)
|
|
$
|
(105,584
|
)
|
|
$
|
597,553
|
|
|
$
|
(23,373
|
)
|
|
$
|
(5,014
|
)
|
|
$
|
463,587
|
|
|
Year Ended Year ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Operating activities:
|
|
|
(Restated)
|
|
(Restated)
|
||||||
Net loss from continuing operations
|
$
|
(194,224
|
)
|
|
$
|
(93,869
|
)
|
|
$
|
(37,782
|
)
|
Net loss from discontinued operations
|
75,495
|
|
|
90,560
|
|
|
40,267
|
|
|||
Gain (loss) on sale of discontinued operations, net of tax
|
(122,842
|
)
|
|
(113,129
|
)
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization expense
|
93,924
|
|
|
94,911
|
|
|
71,049
|
|
|||
Impairment of long-lived assets and capitalized software
|
960
|
|
|
11,055
|
|
|
—
|
|
|||
Change in fair value of financial instruments
|
4,367
|
|
|
—
|
|
|
—
|
|
|||
Amortization of debt issuance costs
|
12,771
|
|
|
1,607
|
|
|
1,501
|
|
|||
Extinguishment of debt
|
29,413
|
|
|
—
|
|
|
—
|
|
|||
Accrued PIK interest
|
(12,090
|
)
|
|
(34
|
)
|
|
—
|
|
|||
Allowance for loan losses
|
14,562
|
|
|
—
|
|
|
—
|
|
|||
Earnings (loss) from equity method investments
|
9,125
|
|
|
—
|
|
|
—
|
|
|||
Gain (loss) on disposals
|
(4,947
|
)
|
|
(122
|
)
|
|
16
|
|
|||
Discontinued operations non-cash and working capital adjustments
|
48,647
|
|
|
371
|
|
|
—
|
|
|||
Amortization of bond premium
|
244
|
|
|
1,416
|
|
|
1,705
|
|
|||
Deferred income taxes
|
19,243
|
|
|
17,148
|
|
|
(453
|
)
|
|||
Non-cash interest on leased facility
|
1,203
|
|
|
1,392
|
|
|
924
|
|
|||
Stock-based compensation
|
22,495
|
|
|
34,178
|
|
|
31,404
|
|
|||
Contingent consideration obligation
|
(2,711
|
)
|
|
1,194
|
|
|
(15
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|||||
Accounts receivable, net of allowance for doubtful accounts
|
29,283
|
|
|
(13,650
|
)
|
|
(19,774
|
)
|
|||
Prepaid expenses and other current assets
|
(5,513
|
)
|
|
31,648
|
|
|
(9,057
|
)
|
|||
Other assets
|
3,237
|
|
|
8,880
|
|
|
(3,751
|
)
|
|||
Accounts payable
|
(9,098
|
)
|
|
(10,089
|
)
|
|
(7,763
|
)
|
|||
Accrued expenses
|
(4,949
|
)
|
|
(7,523
|
)
|
|
(710
|
)
|
|||
Other liabilities
|
(3,337
|
)
|
|
(6,558
|
)
|
|
2,128
|
|
|||
Deferred revenues
|
(23,506
|
)
|
|
55,173
|
|
|
22,297
|
|
|||
Net cash (used in) provided by operating activities
|
(18,248
|
)
|
|
104,559
|
|
|
91,986
|
|
|||
|
|
|
|
|
|
||||||
Investing activities:
|
|
|
|
|
|
||||||
Purchases of fixed assets
|
(12,151
|
)
|
|
(42,570
|
)
|
|
(57,666
|
)
|
|||
Purchases of intangible assets and capitalized software
|
(9,119
|
)
|
|
(7,677
|
)
|
|
(2,553
|
)
|
|||
Proceeds from the sale of Speechcycle
|
13,500
|
|
|
—
|
|
|
—
|
|
|||
Purchases of marketable securities available-for-sale
|
(219
|
)
|
|
(13,445
|
)
|
|
(139,569
|
)
|
|||
Maturities of marketable securities available-for-sale
|
12,371
|
|
|
82,904
|
|
|
106,210
|
|
|||
Equity investment
|
608
|
|
|
—
|
|
|
—
|
|
|||
Investing in discontinued operations
|
(13,721
|
)
|
|
—
|
|
|
—
|
|
|||
Investment In Note Receivable
|
(6,187
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from the sale of discontinued operations
|
928,171
|
|
|
27,335
|
|
|
—
|
|
|||
Businesses acquired, net of cash
|
(815,008
|
)
|
|
(86,322
|
)
|
|
(101,502
|
)
|
|||
Net cash provided by (used in) investing activities
|
98,245
|
|
|
(39,775
|
)
|
|
(195,080
|
)
|
|
Year Ended Year ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Financing activities:
|
|
|
(Restated)
|
|
(Restated)
|
||||||
Proceeds from the exercise of stock options
|
2,584
|
|
|
13,633
|
|
|
19,936
|
|
|||
Taxes paid on withholding shares
|
(442
|
)
|
|
—
|
|
|
—
|
|
|||
Payments on contingent consideration obligation
|
(122
|
)
|
|
—
|
|
|
(4,468
|
)
|
|||
Debt issuance costs related to the Credit Facility and Revolving Facility
|
(3,692
|
)
|
|
(1,346
|
)
|
|
—
|
|
|||
Debt issuance costs related to the 2017 Term Facility
|
(19,887
|
)
|
|
—
|
|
|
—
|
|
|||
Debt amendment costs related to the 2017 Credit Agreement
|
(16,776
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from issuance of long term debt
|
900,000
|
|
|
—
|
|
|
—
|
|
|||
Repayment of long term debt
|
(900,000
|
)
|
|
—
|
|
|
—
|
|
|||
Borrowings on revolving line of credit
|
—
|
|
|
144,000
|
|
|
—
|
|
|||
Repayment of revolving line of credit
|
(29,000
|
)
|
|
(115,000
|
)
|
|
—
|
|
|||
Excess tax benefits from stock option exercises
|
17
|
|
|
—
|
|
|
—
|
|
|||
Repurchases of common stock
|
—
|
|
|
(40,025
|
)
|
|
—
|
|
|||
Proceeds from the sale of treasury stock in connection with an employee stock purchase plan
|
1,047
|
|
|
2,183
|
|
|
1,902
|
|
|||
Proceeds from mandatorily redeemable financial instruments
|
33,592
|
|
|
—
|
|
|
—
|
|
|||
Repayments of capital lease obligations
|
(2,985
|
)
|
|
(3,815
|
)
|
|
(2,021
|
)
|
|||
Net cash (used in) provided by financing activities
|
(35,664
|
)
|
|
(370
|
)
|
|
15,349
|
|
|||
Effect of exchange rate changes on cash
|
(9,641
|
)
|
|
(853
|
)
|
|
(350
|
)
|
|||
Net increase in cash, restricted cash and cash equivalents
|
34,692
|
|
|
63,561
|
|
|
(88,095
|
)
|
|||
Cash, restricted cash and cash equivalents at beginning of period
|
211,433
|
|
|
147,872
|
|
|
235,967
|
|
|||
Cash, restricted cash and cash equivalents at end of period
|
$
|
246,125
|
|
|
$
|
211,433
|
|
|
$
|
147,872
|
|
|
|
|
|
|
|
||||||
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
||||||
Cash paid for income taxes
|
$
|
7,612
|
|
|
$
|
4,661
|
|
|
$
|
29,868
|
|
Cash paid for interest
|
$
|
55,957
|
|
|
$
|
6,981
|
|
|
$
|
5,791
|
|
|
|
|
|
|
|
||||||
Supplemental disclosures of non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Issuance of common stock in connection with Openwave acquisition
|
$
|
—
|
|
|
$
|
22,000
|
|
|
$
|
—
|
|
Issuance of common stock in connection with Intralinks acquisition
|
$
|
4,700
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||
Cash and cash equivalents per Consolidated Balance Sheets
|
$
|
156,299
|
|
|
$
|
169,801
|
|
|
$
|
147,872
|
|
Restricted cash
|
$
|
89,826
|
|
|
$
|
41,632
|
|
|
$
|
—
|
|
Total cash, cash equivalents and restricted cash
|
$
|
246,125
|
|
|
$
|
211,433
|
|
|
$
|
147,872
|
|
1.
|
Description of Business
|
•
|
In certain cases, the Company entered into a license agreement as part of settling prior intellectual property infringement claims against an acquired entity and/or its selling parent company and affiliates. Historically, the Company had recognized these license fees separately as revenue. However, the Company has determined to net these license fees against the consideration paid as part of the acquisitions, resulting in a reduction of the goodwill and/or intangible assets recorded in purchase accounting.
|
•
|
The Company’s consolidated joint venture Zentry LLC (“Zentry”) and the Company’s partner in that joint venture entered into a license agreement in December 2015 at the same time as the formation of the joint venture. Historically, the Company recorded the license fees as revenue separately from the Zentry formation. The Company has determined to net these license fees against the cash contributions paid as part of the joint venture formation, resulting in a reduction of the goodwill and intangible assets recorded in purchase accounting.
|
•
|
The Company entered into a licensing agreement in December 2016 with Sequential Technology International, LLC (“STIN”) shortly after closing the divestiture of its activation business to Sequential Technology International Holdings, LLC (“STIH”). Historically, the Company recorded the license fees as revenue separately from the accounting for the divestiture. The Company has determined to classify these license fees as additional gain on sale of the activation exception handling business.
|
•
|
The Company made adjustments to reduce the contingent consideration payable to shareholders of Razorsight Corporation (“Razorsight”), which was acquired by the Company in August 2015, and the related losses previously recorded to adjust that liability to fair value, as a result of the determination that many of the sales of Razorsight software that had originally been included in the earn-out calculation have now been adjusted as part of the restatement.
|
•
|
The Company made adjustments to record the fair value of the Company’s guarantee of certain of STIN’s debt as part of the divestiture of its activation exception handling business to STIH in December 2016, to record the sellers note extended in the transaction at fair value, and to adjust certain receivables and other assets sold in the transaction.
|
•
|
The Company made certain adjustments to the opening balances of Openwave Messaging, Inc. (“Openwave”) and SNCR, LLC (“SNCR, LLC”); impacting deferred revenue, goodwill and intangibles. Adjustments in deferred revenue and intangibles resulted were reported post-acquisition as revenues and costs were realized.
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Restated
|
||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash and cash equivalents
|
$
|
181,018
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(11,217
|
)
|
|
$
|
—
|
|
|
$
|
169,801
|
|
Restricted cash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41,632
|
|
|
—
|
|
|
41,632
|
|
|||||||
Marketable securities
|
12,506
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,506
|
|
|||||||
Accounts receivable, net
|
137,233
|
|
|
(344
|
)
|
|
(36,509
|
)
|
|
7,896
|
|
|
(802
|
)
|
|
—
|
|
|
107,474
|
|
|||||||
Prepaid expenses and other current assets
|
33,696
|
|
|
—
|
|
|
—
|
|
|
1,408
|
|
|
(1,166
|
)
|
|
4,339
|
|
|
38,277
|
|
|||||||
Total current assets
|
364,453
|
|
|
(344
|
)
|
|
(36,509
|
)
|
|
9,304
|
|
|
28,447
|
|
|
4,339
|
|
|
369,690
|
|
|||||||
Restricted cash
|
30,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(30,000
|
)
|
|
—
|
|
|
—
|
|
|||||||
Marketable securities
|
2,974
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,974
|
|
|||||||
Property and equipment, net
|
155,599
|
|
|
—
|
|
|
—
|
|
|
(823
|
)
|
|
3,429
|
|
|
—
|
|
|
158,205
|
|
|||||||
Goodwill
|
269,905
|
|
|
—
|
|
|
—
|
|
|
(41,358
|
)
|
|
—
|
|
|
(3,896
|
)
|
|
224,651
|
|
|||||||
Intangible assets, net
|
203,864
|
|
|
—
|
|
|
—
|
|
|
(19,830
|
)
|
|
(21,066
|
)
|
|
—
|
|
|
162,968
|
|
|||||||
Deferred tax assets
|
1,503
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,783
|
|
|
13,286
|
|
|||||||
Other assets
|
7,541
|
|
|
—
|
|
|
—
|
|
|
(70
|
)
|
|
1,187
|
|
|
—
|
|
|
8,658
|
|
|||||||
Note receivable from related party
|
83,000
|
|
|
—
|
|
|
—
|
|
|
(12,731
|
)
|
|
—
|
|
|
—
|
|
|
70,269
|
|
|||||||
Equity method investment
|
45,890
|
|
|
—
|
|
|
—
|
|
|
(2,240
|
)
|
|
—
|
|
|
—
|
|
|
43,650
|
|
|||||||
Total Assets
|
$
|
1,164,729
|
|
|
$
|
(344
|
)
|
|
$
|
(36,509
|
)
|
|
$
|
(67,748
|
)
|
|
$
|
(18,003
|
)
|
|
$
|
12,226
|
|
|
$
|
1,054,351
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Restated
|
||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Accounts payable
|
$
|
15,770
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,287
|
|
|
$
|
—
|
|
|
$
|
17,057
|
|
Accrued expenses
|
69,435
|
|
|
—
|
|
|
5,274
|
|
|
971
|
|
|
246
|
|
|
956
|
|
|
76,882
|
|
|||||||
Deferred revenues
|
27,542
|
|
|
33,398
|
|
|
(151
|
)
|
|
(3,360
|
)
|
|
1
|
|
|
—
|
|
|
57,430
|
|
|||||||
Contingent consideration obligation
|
11,860
|
|
|
—
|
|
|
—
|
|
|
(9,027
|
)
|
|
—
|
|
|
—
|
|
|
2,833
|
|
|||||||
Short-term debt
|
29,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
29,000
|
|
|||||||
Total current liabilities
|
153,607
|
|
|
33,398
|
|
|
5,123
|
|
|
(11,416
|
)
|
|
1,534
|
|
|
956
|
|
|
183,202
|
|
|||||||
Lease financing obligation - long term
|
12,121
|
|
|
—
|
|
|
—
|
|
|
41
|
|
|
288
|
|
|
—
|
|
|
12,450
|
|
|||||||
Long-term debt
|
226,291
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
226,291
|
|
|||||||
Deferred tax liability
|
49,822
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(46,314
|
)
|
|
3,508
|
|
|||||||
Deferred revenues
|
12,134
|
|
|
52,965
|
|
|
531
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
65,630
|
|
|||||||
Other liabilities
|
3,783
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,679
|
|
|
2,731
|
|
|
8,193
|
|
|||||||
Redeemable noncontrolling interests
|
49,856
|
|
|
—
|
|
|
—
|
|
|
(28,813
|
)
|
|
4,237
|
|
|
—
|
|
|
25,280
|
|
|||||||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Stockholder's equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Common stock
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||||
Treasury stock
|
(95,183
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,448
|
)
|
|
—
|
|
|
(106,631
|
)
|
|||||||
Additional paid-in capital
|
575,093
|
|
|
—
|
|
|
—
|
|
|
(7,667
|
)
|
|
3,727
|
|
|
—
|
|
|
571,153
|
|
|||||||
Accumulated other comprehensive loss
|
(43,253
|
)
|
|
—
|
|
|
658
|
|
|
—
|
|
|
138
|
|
|
107
|
|
|
(42,350
|
)
|
|||||||
Retained earnings
|
220,453
|
|
|
(86,707
|
)
|
|
(42,821
|
)
|
|
(19,893
|
)
|
|
(18,158
|
)
|
|
54,746
|
|
|
107,620
|
|
|||||||
Total stockholders' equity
|
657,115
|
|
|
(86,707
|
)
|
|
(42,163
|
)
|
|
(27,560
|
)
|
|
(25,741
|
)
|
|
54,853
|
|
|
529,797
|
|
|||||||
Total liabilities & stockholders' equity
|
$
|
1,164,729
|
|
|
$
|
(344
|
)
|
|
$
|
(36,509
|
)
|
|
$
|
(67,748
|
)
|
|
$
|
(18,003
|
)
|
|
$
|
12,226
|
|
|
$
|
1,054,351
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Restated
|
||||||||||||||
Net revenues
|
$
|
476,750
|
|
|
$
|
(39,492
|
)
|
|
$
|
9,435
|
|
|
$
|
(20,399
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
426,294
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
194,198
|
|
|
—
|
|
|
—
|
|
|
(43
|
)
|
|
529
|
|
|
—
|
|
|
194,684
|
|
|||||||
Research and development
|
106,681
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,812
|
|
|
—
|
|
|
114,493
|
|
|||||||
Selling, general and administrative
|
131,106
|
|
|
155
|
|
|
(4,470
|
)
|
|
461
|
|
|
(1,024
|
)
|
|
—
|
|
|
126,228
|
|
|||||||
Net change in contingent consideration obligation
|
10,930
|
|
|
—
|
|
|
—
|
|
|
(9,736
|
)
|
|
—
|
|
|
—
|
|
|
1,194
|
|
|||||||
Restructuring charges
|
6,333
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,333
|
|
|||||||
Depreciation and amortization
|
99,311
|
|
|
—
|
|
|
—
|
|
|
(4,452
|
)
|
|
11,107
|
|
|
—
|
|
|
105,966
|
|
|||||||
Total costs and expenses
|
548,559
|
|
|
155
|
|
|
(4,470
|
)
|
|
(13,770
|
)
|
|
18,424
|
|
|
—
|
|
|
548,898
|
|
|||||||
Loss from continuing operations
|
(71,809
|
)
|
|
(39,647
|
)
|
|
13,905
|
|
|
(6,629
|
)
|
|
(18,424
|
)
|
|
—
|
|
|
(122,604
|
)
|
|||||||
Interest income
|
2,428
|
|
|
—
|
|
|
—
|
|
|
(340
|
)
|
|
(181
|
)
|
|
—
|
|
|
1,907
|
|
|||||||
Interest expense
|
(7,013
|
)
|
|
—
|
|
|
—
|
|
|
374
|
|
|
200
|
|
|
(975
|
)
|
|
(7,414
|
)
|
|||||||
Other expense, net
|
1,863
|
|
|
—
|
|
|
253
|
|
|
(830
|
)
|
|
(264
|
)
|
|
—
|
|
|
1,022
|
|
|||||||
Loss from continuing operations, before taxes
|
(74,531
|
)
|
|
(39,647
|
)
|
|
14,158
|
|
|
(7,425
|
)
|
|
(18,669
|
)
|
|
(975
|
)
|
|
(127,089
|
)
|
|||||||
Benefit for income taxes
|
7,990
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,230
|
|
|
33,220
|
|
|||||||
Net loss from continuing operations
|
(66,541
|
)
|
|
(39,647
|
)
|
|
14,158
|
|
|
(7,425
|
)
|
|
(18,669
|
)
|
|
24,255
|
|
|
(93,869
|
)
|
|||||||
Net income from discontinued operations, net of tax
|
74,533
|
|
|
—
|
|
|
(397
|
)
|
|
17,844
|
|
|
—
|
|
|
(1,420
|
)
|
|
90,560
|
|
|||||||
Net loss
|
7,992
|
|
|
(39,647
|
)
|
|
13,761
|
|
|
10,419
|
|
|
(18,669
|
)
|
|
22,835
|
|
|
(3,309
|
)
|
|||||||
Net loss attributable to redeemable noncontrolling interests
|
(11,596
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,607
|
)
|
|
—
|
|
|
(15,203
|
)
|
|||||||
Net loss attributable to Synchronoss
|
$
|
19,588
|
|
|
$
|
(39,647
|
)
|
|
$
|
13,761
|
|
|
$
|
10,419
|
|
|
$
|
(15,062
|
)
|
|
$
|
22,835
|
|
|
$
|
11,894
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(1.26
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(1.81
|
)
|
||||||||||
Discontinued operations
|
1.71
|
|
|
|
|
|
|
|
|
|
|
|
|
2.08
|
|
||||||||||||
|
$
|
0.45
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.27
|
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(1.26
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(1.81
|
)
|
||||||||||
Discontinued operations
|
1.71
|
|
|
|
|
|
|
|
|
|
|
|
|
2.08
|
|
||||||||||||
|
$
|
0.45
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.27
|
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
43,571
|
|
|
|
|
|
|
|
|
|
|
|
|
43,551
|
|
||||||||||||
Diluted
|
43,571
|
|
|
|
|
|
|
|
|
|
|
|
|
43,551
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Restated
|
||||||||||||||
Net revenues
|
$
|
428,117
|
|
|
$
|
(26,908
|
)
|
|
$
|
1,442
|
|
|
$
|
(30,090
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
372,561
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
155,287
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|
(460
|
)
|
|
—
|
|
|
154,810
|
|
|||||||
Research and development
|
91,430
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,333
|
|
|
—
|
|
|
92,763
|
|
|||||||
Selling, general and administrative
|
88,411
|
|
|
—
|
|
|
(3,042
|
)
|
|
—
|
|
|
(778
|
)
|
|
—
|
|
|
84,591
|
|
|||||||
Net change in contingent consideration obligation
|
760
|
|
|
—
|
|
|
—
|
|
|
755
|
|
|
—
|
|
|
—
|
|
|
1,515
|
|
|||||||
Restructuring charges
|
4,946
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,946
|
|
|||||||
Depreciation and amortization
|
72,152
|
|
|
—
|
|
|
—
|
|
|
(136
|
)
|
|
(967
|
)
|
|
—
|
|
|
71,049
|
|
|||||||
Total costs and expenses
|
412,986
|
|
|
—
|
|
|
(3,042
|
)
|
|
602
|
|
|
(872
|
)
|
|
—
|
|
|
409,674
|
|
|||||||
Loss from continuing operations
|
15,131
|
|
|
(26,908
|
)
|
|
4,484
|
|
|
(30,692
|
)
|
|
872
|
|
|
—
|
|
|
(37,113
|
)
|
|||||||
Interest income
|
2,047
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,047
|
|
|||||||
Interest expense
|
(5,711
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,711
|
)
|
|||||||
Other expense, net
|
372
|
|
|
—
|
|
|
(52
|
)
|
|
(16
|
)
|
|
303
|
|
|
—
|
|
|
607
|
|
|||||||
Loss from continuing operations, before taxes
|
11,839
|
|
|
(26,908
|
)
|
|
4,432
|
|
|
(30,708
|
)
|
|
1,175
|
|
|
—
|
|
|
(40,170
|
)
|
|||||||
Benefit for income taxes
|
(5,424
|
)
|
|
—
|
|
|
(534
|
)
|
|
—
|
|
|
—
|
|
|
8,346
|
|
|
2,388
|
|
|||||||
Net loss from continuing operations
|
6,415
|
|
|
(26,908
|
)
|
|
3,898
|
|
|
(30,708
|
)
|
|
1,175
|
|
|
8,346
|
|
|
(37,782
|
)
|
|||||||
Net income from discontinued operations, net of tax
|
40,267
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40,267
|
|
|||||||
Net loss
|
46,682
|
|
|
(26,908
|
)
|
|
3,898
|
|
|
(30,708
|
)
|
|
1,175
|
|
|
8,346
|
|
|
2,485
|
|
|||||||
Net loss attributable to redeemable noncontrolling interests
|
6,052
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,680
|
)
|
|
—
|
|
|
(628
|
)
|
|||||||
Net loss attributable to Synchronoss
|
$
|
40,630
|
|
|
$
|
(26,908
|
)
|
|
$
|
3,898
|
|
|
$
|
(30,708
|
)
|
|
$
|
7,855
|
|
|
$
|
8,346
|
|
|
$
|
3,113
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.88
|
)
|
||||||||||
Discontinued operations
|
0.95
|
|
|
|
|
|
|
|
|
|
|
|
|
0.95
|
|
||||||||||||
|
$
|
0.96
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.07
|
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.88
|
)
|
||||||||||
Discontinued operations
|
0.95
|
|
|
|
|
|
|
|
|
|
|
|
|
0.95
|
|
||||||||||||
|
$
|
0.96
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.07
|
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
42,284
|
|
|
|
|
|
|
|
|
|
|
|
|
42,284
|
|
||||||||||||
Diluted
|
42,284
|
|
|
|
|
|
|
|
|
|
|
|
|
42,284
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Restated
|
||||||||||||||
Net (loss) income
|
$
|
7,992
|
|
|
$
|
(39,647
|
)
|
|
$
|
13,761
|
|
|
$
|
10,419
|
|
|
$
|
(18,669
|
)
|
|
$
|
22,835
|
|
|
$
|
(3,309
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Foreign currency translation adjustments
|
(4,042
|
)
|
|
—
|
|
|
12
|
|
|
—
|
|
|
23
|
|
|
(107
|
)
|
|
(4,114
|
)
|
|||||||
Unrealized gain (loss) on securities
|
198
|
|
|
—
|
|
|
(141
|
)
|
|
—
|
|
|
(161
|
)
|
|
107
|
|
|
3
|
|
|||||||
Net loss on intra-entity foreign currency transactions
|
(725
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(725
|
)
|
|||||||
Total other comprehensive loss
|
(4,569
|
)
|
|
—
|
|
|
(129
|
)
|
|
—
|
|
|
(138
|
)
|
|
—
|
|
|
(4,836
|
)
|
|||||||
Comprehensive (loss) income
|
$
|
3,423
|
|
|
$
|
(39,647
|
)
|
|
$
|
13,632
|
|
|
$
|
10,419
|
|
|
$
|
(18,807
|
)
|
|
$
|
22,835
|
|
|
$
|
(8,145
|
)
|
Comprehensive (loss) attributable to redeemable noncontrolling interests
|
$
|
(11,596
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3,607
|
)
|
|
$
|
—
|
|
|
$
|
(15,203
|
)
|
Total comprehensive (loss) income attributable to Synchronoss
|
$
|
15,019
|
|
|
$
|
(39,647
|
)
|
|
$
|
13,632
|
|
|
$
|
10,419
|
|
|
$
|
(15,200
|
)
|
|
$
|
22,835
|
|
|
$
|
7,058
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Restated
|
||||||||||||||
Net (loss) income
|
$
|
46,682
|
|
|
$
|
(26,908
|
)
|
|
$
|
3,898
|
|
|
$
|
(30,708
|
)
|
|
$
|
1,175
|
|
|
$
|
8,346
|
|
|
$
|
2,485
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Foreign currency translation adjustments
|
(17,281
|
)
|
|
—
|
|
|
547
|
|
|
—
|
|
|
(58
|
)
|
|
(913
|
)
|
|
(17,705
|
)
|
|||||||
Unrealized gain (loss) on securities
|
(54
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
(19
|
)
|
|
(20
|
)
|
|||||||
Net loss on intra-entity foreign currency transactions
|
(1,335
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,335
|
)
|
|||||||
Total other comprehensive loss
|
(18,670
|
)
|
|
—
|
|
|
547
|
|
|
—
|
|
|
(5
|
)
|
|
(932
|
)
|
|
(19,060
|
)
|
|||||||
Comprehensive (loss) income
|
$
|
28,012
|
|
|
$
|
(26,908
|
)
|
|
$
|
4,445
|
|
|
$
|
(30,708
|
)
|
|
$
|
1,170
|
|
|
$
|
7,414
|
|
|
$
|
(16,575
|
)
|
Comprehensive (loss) attributable to redeemable noncontrolling interests
|
$
|
6,052
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(6,680
|
)
|
|
$
|
—
|
|
|
$
|
(628
|
)
|
Total comprehensive (loss) income attributable to Synchronoss
|
$
|
21,960
|
|
|
$
|
(26,908
|
)
|
|
$
|
4,445
|
|
|
$
|
(30,708
|
)
|
|
$
|
7,850
|
|
|
$
|
7,414
|
|
|
$
|
(15,947
|
)
|
|
|
|
|
|
|
|
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Retained
Earnings
|
|
Total
Stockholders’
Equity
|
||||||||||||||
|
Common Stock
|
|
Treasury Stock
|
|
|
|
|
||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
||||||||||||||||||
Balance at December 31, 2014 (As Previously Reported)
|
46,444
|
|
|
$
|
4
|
|
|
(3,733
|
)
|
|
$
|
(66,336
|
)
|
|
$
|
454,740
|
|
|
$
|
(20,014
|
)
|
|
$
|
160,713
|
|
|
529,107
|
|
|
Adjustments from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Revenue - Hosting, before income tax effect
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,152
|
)
|
|
(20,152
|
)
|
||||||
Revenue - Evidence of Arrangement and Other Revenue, before income tax effect
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
240
|
|
|
(60,478
|
)
|
|
(60,238
|
)
|
||||||
Acquisitions & Divestiture, before income tax effect
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,960
|
)
|
|
(5,960
|
)
|
||||||
Capitalized Software and Other, before income tax effect
|
176
|
|
|
—
|
|
|
(159
|
)
|
|
(1,991
|
)
|
|
2,408
|
|
|
281
|
|
|
(4,599
|
)
|
|
(3,901
|
)
|
||||||
Income tax adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,039
|
|
|
23,569
|
|
|
24,608
|
|
||||||
Total adjustments
|
176
|
|
|
—
|
|
|
(159
|
)
|
|
(1,991
|
)
|
|
2,408
|
|
|
1,560
|
|
|
(67,620
|
)
|
|
(65,643
|
)
|
||||||
Balance at December 31, 2014 (As Restated)
|
46,620
|
|
|
$
|
4
|
|
|
(3,892
|
)
|
|
$
|
(68,327
|
)
|
|
$
|
457,148
|
|
|
$
|
(18,454
|
)
|
|
$
|
93,093
|
|
|
$
|
463,464
|
|
|
As Previously Reported
|
|
Adjustments
|
|
Effect of Early Adoption of ASU 2016-18
|
|
As Restated
|
||||||||
Operating activities:
|
|
|
|
|
|
|
|
||||||||
Net loss continuing operations
|
$
|
(66,541
|
)
|
|
$
|
(27,328
|
)
|
|
$
|
—
|
|
|
$
|
(93,869
|
)
|
Net loss from discontinued operations
|
74,533
|
|
|
16,027
|
|
|
—
|
|
|
90,560
|
|
||||
Gain (loss) on sale of discontinued operations, net of tax
|
(95,311
|
)
|
|
(17,818
|
)
|
|
—
|
|
|
(113,129
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization expense
|
99,311
|
|
|
(4,400
|
)
|
|
—
|
|
|
94,911
|
|
||||
Impairment of long-lived assets and capitalized software
|
—
|
|
|
11,055
|
|
|
—
|
|
|
11,055
|
|
||||
Amortization of debt issuance costs
|
1,607
|
|
|
—
|
|
|
—
|
|
|
1,607
|
|
||||
Accrued PIK interest
|
—
|
|
|
(34
|
)
|
|
—
|
|
|
(34
|
)
|
||||
Gain (loss) on disposals
|
(952
|
)
|
|
830
|
|
|
—
|
|
|
(122
|
)
|
||||
Discontinued operations non-cash and working capital adjustments
|
—
|
|
|
371
|
|
|
—
|
|
|
371
|
|
||||
Amortization of bond premium
|
1,416
|
|
|
—
|
|
|
—
|
|
|
1,416
|
|
||||
Deferred income taxes
|
32,826
|
|
|
(15,678
|
)
|
|
—
|
|
|
17,148
|
|
||||
Non-cash interest on leased facility
|
1,111
|
|
|
281
|
|
|
—
|
|
|
1,392
|
|
||||
Stock-based compensation
|
33,979
|
|
|
199
|
|
|
—
|
|
|
34,178
|
|
||||
Contingent consideration obligation
|
10,930
|
|
|
(9,736
|
)
|
|
—
|
|
|
1,194
|
|
||||
Changes in operating assets and liabilities:
|
—
|
|
|
—
|
|
|
|
|
|
||||||
Accounts receivable, net of allowance for doubtful accounts
|
(1,662
|
)
|
|
(11,988
|
)
|
|
—
|
|
|
(13,650
|
)
|
||||
Prepaid expenses and other current assets
|
12,644
|
|
|
19,004
|
|
|
—
|
|
|
31,648
|
|
||||
Other assets
|
10,054
|
|
|
(1,174
|
)
|
|
—
|
|
|
8,880
|
|
||||
Accounts payable
|
(11,139
|
)
|
|
1,050
|
|
|
—
|
|
|
(10,089
|
)
|
||||
Accrued expenses
|
22,024
|
|
|
(29,547
|
)
|
|
—
|
|
|
(7,523
|
)
|
||||
Other liabilities
|
(6,558
|
)
|
|
—
|
|
|
—
|
|
|
(6,558
|
)
|
||||
Deferred revenues
|
24,317
|
|
|
30,856
|
|
|
—
|
|
|
55,173
|
|
||||
Net cash provided by operating activities
|
142,589
|
|
|
(38,030
|
)
|
|
—
|
|
|
104,559
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Investing activities:
|
|
|
|
|
|
|
|
||||||||
Purchases of fixed assets
|
(58,542
|
)
|
|
15,972
|
|
|
—
|
|
|
(42,570
|
)
|
||||
Purchases of intangible assets and capitalized software
|
—
|
|
|
(7,677
|
)
|
|
—
|
|
|
(7,677
|
)
|
||||
Purchases of marketable securities available-for-sale
|
(13,445
|
)
|
|
—
|
|
|
—
|
|
|
(13,445
|
)
|
||||
Maturities of marketable securities available-for-sale
|
82,904
|
|
|
—
|
|
|
—
|
|
|
82,904
|
|
||||
Change in restricted cash
|
(30,000
|
)
|
|
—
|
|
|
30,000
|
|
|
—
|
|
||||
Proceeds from the sale of discontinued operations
|
18,135
|
|
|
9,200
|
|
|
—
|
|
|
27,335
|
|
||||
Businesses acquired, net of cash
|
(98,428
|
)
|
|
12,106
|
|
|
—
|
|
|
(86,322
|
)
|
||||
Net cash provided by (used in) investing activities
|
(99,376
|
)
|
|
29,601
|
|
|
30,000
|
|
|
(39,775
|
)
|
Financing activities:
|
|
|
|
|
|
|
|
||||||||
Proceeds from the exercise of stock options
|
13,912
|
|
|
(279
|
)
|
|
—
|
|
|
13,633
|
|
||||
Taxes paid on withholding shares
|
(8,885
|
)
|
|
8,885
|
|
|
—
|
|
|
—
|
|
||||
Debt issuance costs related to the Credit Facility
|
(1,346
|
)
|
|
—
|
|
|
—
|
|
|
(1,346
|
)
|
||||
Borrowings on revolving line of credit
|
144,000
|
|
|
—
|
|
|
—
|
|
|
144,000
|
|
||||
Repayment of revolving line of credit
|
(115,000
|
)
|
|
—
|
|
|
—
|
|
|
(115,000
|
)
|
||||
Repurchases of common stock
|
(40,025
|
)
|
|
—
|
|
|
—
|
|
|
(40,025
|
)
|
||||
Proceeds from the sale of treasury stock in connection with an employee stock purchase plan
|
2,183
|
|
|
—
|
|
|
—
|
|
|
2,183
|
|
||||
Repayments of capital lease obligations
|
(3,815
|
)
|
|
—
|
|
|
—
|
|
|
(3,815
|
)
|
||||
Net cash (used in) provided by financing activities
|
(8,976
|
)
|
|
8,606
|
|
|
—
|
|
|
(370
|
)
|
||||
Effect of exchange rate changes on cash
|
(853
|
)
|
|
—
|
|
|
—
|
|
|
(853
|
)
|
||||
Net increase in cash and cash equivalents
|
33,384
|
|
|
177
|
|
|
30,000
|
|
|
63,561
|
|
||||
Cash and cash equivalents at beginning of period
|
147,634
|
|
|
238
|
|
|
—
|
|
|
147,872
|
|
||||
Cash and cash equivalents at end of period
|
181,018
|
|
|
415
|
|
|
30,000
|
|
|
211,433
|
|
||||
Cash and cash equivalents
|
181,018
|
|
|
(11,217
|
)
|
|
—
|
|
|
169,801
|
|
||||
Restricted cash
|
—
|
|
|
11,632
|
|
|
30,000
|
|
|
41,632
|
|
||||
Total cash and cash equivalents at end of period
|
181,018
|
|
|
415
|
|
|
30,000
|
|
|
211,433
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
|
||||||||
Cash paid for income taxes
|
4,661
|
|
|
|
|
|
|
4,661
|
|
||||||
Cash paid for interest
|
6,981
|
|
|
|
|
|
|
6,981
|
|
||||||
|
|
|
|
|
|
|
|
||||||||
Supplemental disclosures of non-cash investing and financing activities:
|
|
|
|
|
|
|
|
||||||||
Issuance of common stock in connection with Openwave acquisition
|
$
|
22,000
|
|
|
|
|
|
|
$
|
22,000
|
|
|
As Previously Reported
|
|
Adjustments
|
|
As Restated
|
||||||
Operating activities:
|
|
|
|
|
|
||||||
Net loss continuing operations
|
$
|
6,415
|
|
|
$
|
(44,197
|
)
|
|
$
|
(37,782
|
)
|
Net loss from discontinued operations
|
40,267
|
|
|
—
|
|
|
40,267
|
|
|||
|
|
|
|
|
|
||||||
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization expense
|
72,152
|
|
|
(1,103
|
)
|
|
71,049
|
|
|||
Amortization of debt issuance costs
|
1,501
|
|
|
—
|
|
|
1,501
|
|
|||
Gain (loss) on disposals
|
16
|
|
|
—
|
|
|
16
|
|
|||
Amortization of bond premium
|
1,705
|
|
|
—
|
|
|
1,705
|
|
|||
Deferred income taxes
|
8,319
|
|
|
(8,772
|
)
|
|
(453
|
)
|
|||
Non-cash interest on leased facility
|
924
|
|
|
—
|
|
|
924
|
|
|||
Stock-based compensation
|
31,711
|
|
|
(307
|
)
|
|
31,404
|
|
|||
Contingent consideration obligation
|
(772
|
)
|
|
757
|
|
|
(15
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable, net of allowance for doubtful accounts
|
(27,577
|
)
|
|
7,803
|
|
|
(19,774
|
)
|
|||
Prepaid expenses and other current assets
|
(8,543
|
)
|
|
(514
|
)
|
|
(9,057
|
)
|
|||
Other assets
|
(4,282
|
)
|
|
531
|
|
|
(3,751
|
)
|
|||
Accounts payable
|
6,185
|
|
|
(13,948
|
)
|
|
(7,763
|
)
|
|||
Accrued expenses
|
16,333
|
|
|
(17,043
|
)
|
|
(710
|
)
|
|||
Other liabilities
|
(402
|
)
|
|
2,530
|
|
|
2,128
|
|
|||
Deferred revenues
|
(4,130
|
)
|
|
26,427
|
|
|
22,297
|
|
|||
Net cash provided by operating activities
|
139,822
|
|
|
(47,836
|
)
|
|
91,986
|
|
|||
|
|
|
|
|
|
||||||
Investing activities:
|
|
|
|
|
|
||||||
Purchases of fixed assets
|
(59,960
|
)
|
|
2,294
|
|
|
(57,666
|
)
|
|||
Purchases of intangible assets and capitalized software
|
(1,200
|
)
|
|
(1,353
|
)
|
|
(2,553
|
)
|
|||
Purchases of marketable securities available-for-sale
|
(139,569
|
)
|
|
—
|
|
|
(139,569
|
)
|
|||
Maturities of marketable securities available-for-sale
|
106,210
|
|
|
—
|
|
|
106,210
|
|
|||
Change in restricted cash
|
—
|
|
|
—
|
|
|
—
|
|
|||
Businesses acquired, net of cash
|
(131,592
|
)
|
|
30,090
|
|
|
(101,502
|
)
|
|||
Net cash provided by (used in) investing activities
|
(226,111
|
)
|
|
31,031
|
|
|
(195,080
|
)
|
|||
|
|
|
|
|
|
||||||
Financing activities:
|
|
|
|
|
|
||||||
Proceeds from the exercise of stock options
|
19,936
|
|
|
—
|
|
|
19,936
|
|
|||
Taxes paid on withholding shares
|
(17,043
|
)
|
|
17,043
|
|
|
—
|
|
|||
Payments on contingent consideration obligation
|
(4,468
|
)
|
|
—
|
|
|
(4,468
|
)
|
|||
Proceeds from the sale of treasury stock in connection with an employee stock purchase plan
|
1,902
|
|
|
—
|
|
|
1,902
|
|
|||
Repayments of capital lease obligations
|
(2,021
|
)
|
|
—
|
|
|
(2,021
|
)
|
|||
Net cash (used in) provided by financing activities
|
(1,694
|
)
|
|
17,043
|
|
|
15,349
|
|
|||
Effect of exchange rate changes on cash
|
(350
|
)
|
|
—
|
|
|
(350
|
)
|
|||
Net increase in cash and cash equivalents
|
(88,333
|
)
|
|
238
|
|
|
(88,095
|
)
|
|||
Cash and cash equivalents at beginning of period
|
235,967
|
|
|
—
|
|
|
235,967
|
|
|||
Cash and cash equivalents at end of period
|
$
|
147,634
|
|
|
$
|
238
|
|
|
$
|
147,872
|
|
|
|
|
|
|
|
||||||
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
||||||
Cash paid for income taxes
|
$
|
29,868
|
|
|
|
|
$
|
29,868
|
|
||
Cash paid for interest
|
$
|
5,791
|
|
|
|
|
$
|
5,791
|
|
|
Year ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
(Restated)
|
|
(Restated)
|
||||||
Unamortized software development costs
|
$
|
11,695
|
|
|
$
|
5,754
|
|
|
$
|
4,390
|
|
Software development amortization expense
|
3,178
|
|
|
3,507
|
|
|
55
|
|
|
Year ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
(Restated)
|
|
(Restated)
|
||||||
Net loss on foreign currency translations
|
$
|
(4,952
|
)
|
|
$
|
(270
|
)
|
|
$
|
(512
|
)
|
Standard
|
|
Description
|
|
Effect on the financial statements
|
Accounting Standards Update (“ASU”) 2017-04 Simplifying the Test for Goodwill Impairment
|
|
In January 2017, the Financial Accounting Standards Board (“FASB”) issued guidance which eliminates Step 2 from the goodwill impairment test. Under the amendments in this Update, an entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. ASU 2017-04 also eliminates the requirement for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. ASU 2017-04 is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017.
|
|
The Company elected to early adopt this ASU for annual and interim goodwill impairment testing dates after January 1, 2017. The adoption of this ASU had no impact on the Company’s consolidated financial statements.
|
Date of adoption: January 1, 2020.
|
|
|
|
|
Standard
|
|
Description
|
|
Effect on the financial statements
|
ASU 2017-01 Business Combinations (Topic 805), Clarifying the Definition of a Business
|
|
In January 2017, FASB changed its definition of a business in an effort to help entities determine whether a set of transferred assets and activities is a business. The guidance requires an entity to first evaluate whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the set of transferred assets and activities is not a business. If the threshold is not met, the entity evaluates whether the set meets the requirement that a business include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. The guidance narrows the definition of outputs by more closely aligning it with how outputs are described in the new revenue guidance. The guidance is effective for public business entities for annual periods beginning after 15 December 2017, and interim periods within those periods. For all other entities, it is effective for annual periods beginning after 15 December 2018, and interim periods within annual periods beginning after 15 December 2019. Early adoption is permitted.
|
|
The Company elected to early adopt this ASU on January 1, 2017 on a prospective basis. The adoption of this ASU had no impact on the Company’s consolidated financial statements.
|
Date of adoption: January 1, 2017.
|
|
|
|
|
ASU 2016-18 Statement of Cash Flows (Topic 230)
|
|
In November 2016, the FASB issued ASU 2016-18, which amends the guidance in ASC 230, including providing additional guidance related to transfers between cash and restricted cash and how entities present, in their statement of cash flows, the cash receipts and cash payments that directly affect the restricted cash accounts. ASU 2016-18 is effective for annual reporting periods beginning after December 15, 2017, and interim periods within those years, with early adoption permitted.
|
|
The Company adopted this ASU on January 1, 2017 to each period presented and applied the changes to the Consolidated Statements of Cash Flows.
|
Date of adoption: January 1, 2017.
|
|
|
|
|
ASU 2016-17 Consolidation: Interest Held through Related Parties That Are under Common Control
|
|
In October 2016, the FASB issued ASU 2016-17, to amend the consolidation guidance on how a reporting entity that is the single decision maker of a variable interest entity should treat indirect interests in the entity held through related parties that are under common control within the reporting entity when determining whether it is the primary beneficiary of that variable interest entity. The standard is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption is permitted.
|
|
The Company elected to early adopt this ASU on January 1, 2017 on a prospective basis. The adoption of this ASU had no significant impact on the Company’s consolidated financial statements.
|
Date of adoption: January 1, 2017.
|
|
|
|
|
ASU 2016-16 Intra-Entity Transfers of Assets Other Than Inventory
|
|
In October 2016, the FASB issued ASU 2016-16, which requires entities to recognize at the transaction date the income tax effects for intra-entity transfers of assets other than inventory. The standard is effective for interim and annual reporting periods beginning after December 15, 2017, with early adoption permitted.
|
|
The Company elected to early adopt this ASU on January 1, 2017 on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings of $3.2 million as of January 1, 2017.
|
Date of adoption: January 1, 2017.
|
|
|
|
|
ASU 2016-15 Statement of Cash Flows
|
|
In August 2016, the FASB issued ASU 2016-15 which will make eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. ASU 2016-15 is effective for fiscal years beginning after December 15, 2017. ASU 2016-15 will require adoption on a retrospective basis unless it is impracticable to apply, in which case the Company would be required to apply the amendments prospectively as of the earliest date practicable.
|
|
The Company elected to early adopt this ASU on January 1, 2017 using a retrospective transition method. The adoption of this ASU had no impact on the Company’s consolidated financial statements.
|
Date of adoption: January 1, 2017.
|
|
|
|
|
Standard
|
|
Description
|
|
Effect on the financial statements
|
ASU 2017-09 Stock Compensation (Topic 718), Scope of Modification Accounting
|
|
In May 2017, FASB issued guidance which clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. Entities will apply the modification accounting guidance if the value, vesting conditions or classification of the award changes. The guidance also clarifies that a modification to an award could be significant and therefore require disclosure, even if modification accounting is not required. ASU 2017-09 is effective for fiscal years, and interim periods within those years, beginning after December 31, 2017. Early adoption is permitted as of the beginning of an annual period for which financial statements have not been issued. ASU 2017-09 should be applied prospectively to an award modified on or after the adoption date.
|
|
The Company is currently evaluating the impact of the adoption of this ASU on its consolidated financial statements.
|
Date of adoption: January 1, 2018.
|
|
|
|
|
ASU 2016-13 Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments
|
|
In June 2016, the FASB issued ASU 2016-13 which replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The ASU is effective for public companies in annual periods beginning after December 15, 2019, and interim periods within those years. Early adoption is permitted beginning after December 15, 2018 and interim periods within those years.
|
|
The Company is currently evaluating the impact of the adoption of this ASU on its consolidated financial statements.
|
Date of adoption: January 1, 2020.
|
|
|
|
|
ASU 2016-02 Leases (Topic 842)
|
|
In February 2016, the FASB issued ASU 2016-02 which requires lessees to recognize, for all leases of 12 months or more, a liability to make lease payments and a right-of-use asset representing the right to use the underlying asset for the lease term. Additionally, the guidance requires improved disclosures to help users of financial statements better understand the nature of an entity’s leasing activities. This ASU is effective for public reporting companies for interim and annual periods beginning after December 15, 2018, with early adoption permitted, and must be adopted using a modified retrospective approach.
|
|
The Company is in the process of evaluating the effect of the new guidance on its consolidated financial statements and disclosures.
|
Date of adoption: January 1, 2019.
|
|
|
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Property and equipment, net:
|
|
|
(Restated)
|
||||
Domestic
|
$
|
106,727
|
|
|
$
|
149,378
|
|
Foreign
|
5,098
|
|
|
8,827
|
|
||
Total
|
$
|
111,825
|
|
|
$
|
158,205
|
|
Cash consideration for outstanding Intralinks’ common shares
|
$
|
746,071
|
|
Cash consideration for accelerated equity awards to Intralinks’ employees upon change in control
|
7,873
|
|
|
Cash consideration for vested unexercised Intralinks’ stock options
|
19,838
|
|
|
Cash consideration for existing Intralinks’ debt
|
77,800
|
|
|
Cash consideration for shareholders purchase price settlement
|
2,794
|
|
|
Total cash consideration transferred
|
854,376
|
|
|
Fair value of replacement awards
|
4,702
|
|
|
Total consideration transferred
|
$
|
859,078
|
|
|
Weighted Average Life in Years
|
|
Purchase Price Allocation
|
||
Cash
|
|
|
$
|
39,370
|
|
Accounts receivable
|
|
|
46,182
|
|
|
Prepaid expenses and other assets
|
|
|
9,775
|
|
|
Property and equipment, net
|
4
|
|
14,075
|
|
|
Goodwill
|
|
|
482,822
|
|
|
Intangible Assets:
|
|
|
|
||
Developed technology
|
6
|
|
79,400
|
|
|
Capitalized software costs
|
1
|
|
277
|
|
|
Trade name
|
18
|
|
47,800
|
|
|
Customer relationships
|
10
|
|
284,100
|
|
|
|
|
|
411,577
|
|
|
Other assets, long-term
|
|
|
3,865
|
|
|
Investment in unconsolidated affiliate
|
|
|
5,800
|
|
|
Total assets acquired
|
|
|
1,013,466
|
|
|
|
|
|
|
||
Accounts payable
|
|
|
4,853
|
|
|
Accrued expenses
|
|
|
21,421
|
|
|
Deferred revenues, short-term
|
|
|
12,449
|
|
|
Deferred tax liability
|
|
|
110,044
|
|
|
Deferred revenues, long-term
|
|
|
1,051
|
|
|
Other liabilities, long-term
|
|
|
4,570
|
|
|
Total liabilities
|
|
|
154,388
|
|
|
Net assets acquired
|
|
|
$
|
859,078
|
|
|
2017
|
||
Net revenues
|
$
|
213,178
|
|
Costs and expenses:
|
|
||
Cost of services
|
35,393
|
|
|
Research and development
|
19,148
|
|
|
Selling, general and administrative
|
114,737
|
|
|
Restructuring
|
15,995
|
|
|
Depreciation and amortization
|
41,780
|
|
|
Total costs and expenses
|
227,053
|
|
|
Other income, net
|
1,448
|
|
|
Loss from discontinued operations
|
(12,427
|
)
|
|
Gain on sale of discontinued operations
|
122,842
|
|
|
Income from discontinued operations before taxes
|
110,415
|
|
|
Provision for income taxes
|
(34,920
|
)
|
|
Discontinued operations, net of taxes
|
$
|
75,495
|
|
|
Purchase Price Allocation (Restated)
|
|
|
||
Cash
|
$
|
4,110
|
|
|
|
Prepaid expenses and other assets
|
3,005
|
|
|
|
|
Property, Plant & Equipment
|
2,882
|
|
|
||
Long term assets
|
1,870
|
|
|
|
|
Intangible assets:
|
|
|
Wtd. Avg.
|
||
Trade name
|
1,000
|
|
|
1 year
|
|
Technology
|
32,100
|
|
|
7 years
|
|
Customer relationships
|
29,000
|
|
|
10 years
|
|
Goodwill
|
81,015
|
|
|
|
|
Total assets acquired
|
154,982
|
|
|
|
|
Accounts payable and accrued liabilities
|
17,622
|
|
|
|
|
Deferred revenues
|
7,331
|
|
|
|
|
Long term liabilities
|
15,491
|
|
|
|
|
Net assets acquired
|
$
|
114,538
|
|
|
|
|
Year ended December 31,
|
||||||
|
2016
|
|
2015
|
||||
|
(Restated)
|
||||||
Net revenues
|
$
|
145,241
|
|
|
$
|
150,714
|
|
Costs and expenses:
|
|
|
|
||||
Cost of services
|
96,737
|
|
|
83,931
|
|
||
Selling, general and administrative
|
2,615
|
|
|
2,324
|
|
||
Total costs and expenses
|
99,352
|
|
|
86,255
|
|
||
Income from discontinued operations
|
45,889
|
|
|
64,459
|
|
||
Gain on sale of discontinued operations
|
113,130
|
|
|
—
|
|
||
Income from discontinued operations before taxes
|
159,019
|
|
|
64,459
|
|
||
Provision for income taxes
|
(68,459
|
)
|
|
(24,191
|
)
|
||
Discontinued operations, net of taxes
|
$
|
90,560
|
|
|
$
|
40,268
|
|
•
|
Level 1 - Observable inputs - quoted prices in active markets for identical assets and liabilities;
|
•
|
Level 2 - Observable inputs other than the quoted prices in active markets for identical assets and liabilities includes quoted prices for similar instruments, quoted prices for identical or similar instruments in inactive markets, and amounts derived from valuation models where all significant inputs are observable in active markets; and
|
•
|
Level 3 - Unobservable inputs - includes amounts derived from valuation models where one or more significant inputs are unobservable and require the Company to develop relevant assumptions.
|
|
December 31, 2017
|
||||||||||||||
|
Total
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Cash, cash equivalents and restricted cash
(1)
|
$
|
246,125
|
|
|
$
|
246,125
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Marketable securities-short term
(2)
|
3,111
|
|
|
—
|
|
|
3,111
|
|
|
—
|
|
||||
Total assets
|
$
|
249,236
|
|
|
$
|
246,125
|
|
|
$
|
3,111
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||
Contingent interest derivative
(3)
|
193
|
|
|
|
|
|
|
193
|
|
||||||
Mandatorily redeemable financial instrument
(4)
|
37,959
|
|
|
|
|
|
|
37,959
|
|
||||||
Total liabilities
|
$
|
38,152
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
38,152
|
|
Temporary Equity
|
|
|
|
|
|
|
|
||||||||
Redeemable noncontrolling interests
(4)
|
$
|
25,280
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
25,280
|
|
Total temporary equity
|
$
|
25,280
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
25,280
|
|
|
December 31, 2016
|
||||||||||||||
(Restated)
|
Total
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Cash, cash equivalents and restricted cash
(1)
|
$
|
211,433
|
|
|
$
|
211,433
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Marketable securities-short term
(2)
|
12,506
|
|
|
—
|
|
|
12,506
|
|
|
—
|
|
||||
Marketable securities-long term
(2)
|
2,974
|
|
|
—
|
|
|
2,974
|
|
|
—
|
|
||||
Total assets
|
$
|
226,913
|
|
|
$
|
211,433
|
|
|
$
|
15,480
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Contingent consideration obligation
|
$
|
2,833
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,833
|
|
Total liabilities
|
$
|
2,833
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,833
|
|
Temporary Equity
|
|
|
|
|
|
|
|
||||||||
Redeemable noncontrolling interests
(5)
|
$
|
25,280
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
25,280
|
|
Total temporary equity
|
$
|
25,280
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
25,280
|
|
(1)
|
Cash equivalents primarily include money market funds
|
(2)
|
Comprised of municipal bonds and certificates of deposit
|
(3)
|
Contingent interest derivative related to convertible debt is included in accrued expenses, for further details see
Note 11 - Debt
.
|
(4)
|
Mandatorily redeemable financial instruments comprise of the Company’s contractual obligation to deliver a set number of preferred shares at a time in less than twelve months and the option for the Company to receive a set number of common shares
|
(5)
|
Put arrangements held by the noncontrolling interests in certain of the Company’s joint ventures
|
|
December 31, 2017
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
||||||||
Marketable securities:
|
|
|
|
|
|
|
|
||||||||
Certificates of deposit
|
$
|
250
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
250
|
|
Municipal bonds
|
2,867
|
|
|
—
|
|
|
(6
|
)
|
|
2,861
|
|
||||
Total marketable securities
|
$
|
3,117
|
|
|
$
|
—
|
|
|
$
|
(6
|
)
|
|
$
|
3,111
|
|
|
December 31, 2016
|
||||||||||||||
|
(Restated)
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
||||||||
Marketable securities:
|
|
|
|
|
|
|
|
||||||||
Certificates of deposit
|
$
|
450
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
450
|
|
Municipal bonds
|
15,063
|
|
|
1
|
|
|
(34
|
)
|
|
15,030
|
|
||||
Total marketable securities
|
$
|
15,513
|
|
|
$
|
1
|
|
|
$
|
(34
|
)
|
|
$
|
15,480
|
|
|
December 31, 2017
|
||||||
|
Amortized
Cost
|
|
Fair
Value
|
||||
Due within one year
|
$
|
3,117
|
|
|
$
|
3,111
|
|
Due after 1 year through 5 years
|
—
|
|
|
—
|
|
||
Total available-for-sale securities
|
$
|
3,117
|
|
|
$
|
3,111
|
|
Balance at December 31, 2016, as restated
|
$
|
2,833
|
|
Payment of contingent consideration
|
(2,831
|
)
|
|
Other adjustments to contingent consideration obligation included in net income
|
(2
|
)
|
|
Balance at December 31, 2017
|
$
|
—
|
|
Balance at December 31, 2016
|
$
|
25,280
|
|
Fair value and other adjustments
|
9,291
|
|
|
Net loss attributable to interests in subsidiaries
|
(9,291
|
)
|
|
Balance at December 31, 2017
|
$
|
25,280
|
|
•
|
Access to use its PBX system, which acts as a digital call exchange used to process both in-bound and out-bound calls as well as any corresponding interactive voice response (“IVR”).
|
•
|
Solution access and hosting, including Synchronoss Activation Gateway (“SAG”) and iNow virtual front office platforms (the “Solution” service) includes access to a number of order managers, call tracker and reporting (visibility) modules used to initiate and perform necessary tasks as part of the exception handling process. Access to the Solution provides a mechanism for the exception handling business, whether STIN or any other BPO customer, to process orders manually. The Company is obligated to host and maintain the related technology throughout the term. In the event additional programs arise, requiring the use of Synchronoss products, such incremental programs will be priced in negotiations at such time.
|
•
|
Technical support service, including network infrastructure support and maintenance. The Company will provide access to use and support to ensure fully operational workstations (including personal computers), including desktop, workstation and network support to the PBX systems, including firewall and anti-virus protection.
|
|
Seller Note
|
|
Allowance
|
|
Unamortized discount
|
|
Loan accrued interest
|
|
Distribution Note
|
|
Distribution interest
|
|
Total
|
||||||||||||||
Balance at December 31, 2016 (Restated)
|
$
|
83,000
|
|
|
$
|
—
|
|
|
$
|
(13,146
|
)
|
|
$
|
415
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
70,269
|
|
Activity
|
|
|
(14,562
|
)
|
|
984
|
|
|
10,681
|
|
|
6,187
|
|
|
425
|
|
|
3,715
|
|
||||||||
Balance at December 31, 2017
|
$
|
83,000
|
|
|
$
|
(14,562
|
)
|
|
$
|
(12,162
|
)
|
|
$
|
11,096
|
|
|
$
|
6,187
|
|
|
$
|
425
|
|
|
$
|
73,984
|
|
|
Year Ended December 31,
|
||||||
|
2017
|
|
2016
|
||||
Restricted cash
(A)
|
$
|
118
|
|
|
$
|
—
|
|
Accounts receivable
(B)
|
18,033
|
|
|
1,164
|
|
||
Total assets
|
$
|
18,151
|
|
|
$
|
1,164
|
|
(A)
|
Represents cash balances
outstanding as of year end in which the Company collected accounts receivable from STIN customers on behalf of STIN. This amount has been classified in short term restricted cash on the Consolidated Balance Sheets.
|
(B)
|
These amounts principally included revenues generated from the Cloud and Telephony Support Services agreement and pass-through of vendor expenses incurred during the transition and assignment of vendor contracts.
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
|
|
(Restated)
|
|
|||
Computer hardware
|
$
|
250,453
|
|
|
$
|
242,739
|
|
Computer software
|
62,335
|
|
|
47,828
|
|
||
Construction in-progress
|
471
|
|
|
14,854
|
|
||
Furniture and fixtures
|
7,736
|
|
|
5,981
|
|
||
Building
|
8,808
|
|
|
8,808
|
|
||
Leasehold improvements
|
19,591
|
|
|
16,980
|
|
||
|
349,394
|
|
|
337,190
|
|
||
Less: Accumulated depreciation
|
(237,569
|
)
|
|
(178,985
|
)
|
||
|
$
|
111,825
|
|
|
$
|
158,205
|
|
Balance at December 31, 2015, as restated
|
$
|
149,928
|
|
Acquisitions
|
81,016
|
|
|
Divestitures
|
—
|
|
|
Reclassifications, adjustments and other
|
(3,033
|
)
|
|
Translation adjustments
|
(3,260
|
)
|
|
Balance at December 31, 2016, as restated
|
$
|
224,651
|
|
Acquisitions
|
—
|
|
|
Divestitures
|
(1,854
|
)
|
|
Reclassifications, adjustments and other
|
181
|
|
|
Translation adjustments
|
14,325
|
|
|
Balance at December 31, 2017
|
$
|
237,303
|
|
|
December 31, 2017
|
||||||||||
|
Cost
|
|
Accumulated
Amortization
|
|
Net
|
||||||
Technology
|
$
|
124,799
|
|
|
$
|
(70,608
|
)
|
|
$
|
54,191
|
|
Customer lists and relationships
|
128,170
|
|
|
(62,905
|
)
|
|
65,265
|
|
|||
Capitalized software and patents
|
19,792
|
|
|
(7,115
|
)
|
|
12,677
|
|
|||
Trade name
|
2,559
|
|
|
(2,525
|
)
|
|
34
|
|
|||
|
$
|
275,320
|
|
|
$
|
(143,153
|
)
|
|
$
|
132,167
|
|
|
December 31, 2016
|
||||||||||
|
(Restated)
|
||||||||||
|
Cost
|
|
Accumulated
Amortization
|
|
Net
|
||||||
Technology
|
$
|
129,382
|
|
|
$
|
(53,142
|
)
|
|
$
|
76,240
|
|
Customer lists and relationships
|
129,650
|
|
|
(49,852
|
)
|
|
79,798
|
|
|||
Capitalized software and patents
|
10,589
|
|
|
(3,923
|
)
|
|
6,666
|
|
|||
Trade name
|
2,523
|
|
|
(2,259
|
)
|
|
264
|
|
|||
|
$
|
272,144
|
|
|
$
|
(109,176
|
)
|
|
$
|
162,968
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
|
|
(Restated)
|
||||
Accrued compensation and benefits
|
$
|
22,679
|
|
|
$
|
33,771
|
|
Accrued accounting fees
|
19,822
|
|
|
3,154
|
|
||
Accrued consulting fees
|
6,200
|
|
|
13,951
|
|
||
Accrued legal fees
|
5,513
|
|
|
3,172
|
|
||
Accrued telecommunications
|
3,028
|
|
|
2,628
|
|
||
Accrued income taxes payable
|
2,810
|
|
|
4,643
|
|
||
Accrued other
|
12,687
|
|
|
15,563
|
|
||
|
$
|
72,739
|
|
|
$
|
76,882
|
|
Year ending December 31,
|
Colocation
|
|
Operating Leases
|
|
Capital Leases
|
||||||
2018
|
$
|
7,888
|
|
|
$
|
9,743
|
|
|
$
|
2,465
|
|
2019
|
5,373
|
|
|
10,103
|
|
|
2,383
|
|
|||
2020
|
3,614
|
|
|
9,893
|
|
|
1,964
|
|
|||
2021
|
—
|
|
|
9,149
|
|
|
1,282
|
|
|||
2022 and thereafter
|
—
|
|
|
46,451
|
|
|
7,155
|
|
|||
|
$
|
16,875
|
|
|
$
|
85,339
|
|
|
$
|
15,249
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Convertible Senior Notes
|
$
|
230,000
|
|
|
$
|
230,000
|
|
Amended Credit Agreement
|
—
|
|
|
29,000
|
|
||
Total debt, principal amount
|
230,000
|
|
|
259,000
|
|
||
Debt issuance costs
|
(2,296
|
)
|
|
(3,709
|
)
|
||
Total debt, carrying value
|
$
|
227,704
|
|
|
$
|
255,291
|
|
Total short term debt, carrying value
|
$
|
—
|
|
|
$
|
29,000
|
|
Total long-term debt, carrying value
|
$
|
227,704
|
|
|
$
|
226,291
|
|
|
Year ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Contractual interest expense
|
$
|
1,725
|
|
|
$
|
1,725
|
|
|
$
|
1,725
|
|
Contingent interest expense
|
193
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
1,918
|
|
|
$
|
1,725
|
|
|
$
|
1,725
|
|
|
Foreign
Currency
|
|
Unrealized
(Loss)
Income on
Intra-Entity
Foreign
Currency
Transactions
|
|
Unrealized Holding
Gains
(Losses) on
Available-for-Sale
Securities
|
|
Total
|
||||||||
Balance at December 31, 2016
|
$
|
(37,311
|
)
|
|
$
|
(5,017
|
)
|
|
$
|
(22
|
)
|
|
$
|
(42,350
|
)
|
Other comprehensive income (loss)
|
17,027
|
|
|
3,322
|
|
|
28
|
|
|
20,377
|
|
||||
Tax effect
|
—
|
|
|
(1,390
|
)
|
|
(10
|
)
|
|
(1,400
|
)
|
||||
Comprehensive income (loss)
|
17,027
|
|
|
1,932
|
|
|
18
|
|
|
18,977
|
|
||||
Balance at December 31, 2017
|
$
|
(20,284
|
)
|
|
$
|
(3,085
|
)
|
|
$
|
(4
|
)
|
|
$
|
(23,373
|
)
|
(Restated)
|
Foreign
Currency
|
|
Unrealized
(Loss)
Income on
Intra-Entity
Foreign
Currency
Transactions
|
|
Unrealized Holding
Gains
(Losses) on
Available-for-Sale
Securities
|
|
Total
|
||||||||
Balance at December 31, 2015
|
$
|
(33,197
|
)
|
|
$
|
(4,292
|
)
|
|
$
|
(25
|
)
|
|
$
|
(37,514
|
)
|
Other comprehensive income (loss)
|
(4,114
|
)
|
|
(789
|
)
|
|
5
|
|
|
(4,898
|
)
|
||||
Tax effect
|
—
|
|
|
64
|
|
|
(2
|
)
|
|
62
|
|
||||
Total comprehensive income (loss)
|
(4,114
|
)
|
|
(725
|
)
|
|
3
|
|
|
(4,836
|
)
|
||||
Balance at December 31, 2016
|
$
|
(37,311
|
)
|
|
$
|
(5,017
|
)
|
|
$
|
(22
|
)
|
|
$
|
(42,350
|
)
|
(Restated)
|
Foreign
Currency
|
|
Unrealized
(Loss)
Income on
Intra-Entity
Foreign
Currency
Transactions
|
|
Unrealized Holding
Gains
(Losses) on
Available-for-Sale
Securities
|
|
Total
|
||||||||
Balance at December 31, 2014
|
$
|
(15,492
|
)
|
|
$
|
(2,957
|
)
|
|
$
|
(5
|
)
|
|
$
|
(18,454
|
)
|
Other comprehensive income (loss)
|
(17,705
|
)
|
|
(2,722
|
)
|
|
(30
|
)
|
|
(20,457
|
)
|
||||
Tax effect
|
—
|
|
|
1,387
|
|
|
10
|
|
|
1,397
|
|
||||
Total comprehensive income (loss)
|
(17,705
|
)
|
|
(1,335
|
)
|
|
(20
|
)
|
|
(19,060
|
)
|
||||
Balance at December 31, 2015
|
$
|
(33,197
|
)
|
|
$
|
(4,292
|
)
|
|
$
|
(25
|
)
|
|
$
|
(37,514
|
)
|
|
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
(Restated)
|
|
(Restated)
|
||||||
Cost of revenues
|
$
|
4,602
|
|
|
$
|
7,310
|
|
|
$
|
6,922
|
|
Research and development
|
6,030
|
|
|
8,891
|
|
|
7,461
|
|
|||
Selling, general and administrative
|
11,863
|
|
|
17,977
|
|
|
17,021
|
|
|||
Total stock-based compensation
|
$
|
22,495
|
|
|
$
|
34,178
|
|
|
$
|
31,404
|
|
|
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
(Restated)
|
|
(Restated)
|
||||||
Stock options
|
$
|
6,311
|
|
|
$
|
7,778
|
|
|
$
|
8,495
|
|
Restricted stock awards
|
15,802
|
|
|
25,583
|
|
|
22,285
|
|
|||
ESPP Plan
|
382
|
|
|
817
|
|
|
624
|
|
|||
Total stock-based compensation before taxes
|
$
|
22,495
|
|
|
$
|
34,178
|
|
|
$
|
31,404
|
|
Tax benefit
|
$
|
3,921
|
|
|
$
|
11,108
|
|
|
$
|
10,130
|
|
|
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Expected stock price volatility
|
57.0
|
%
|
|
45.0
|
%
|
|
47.0
|
%
|
|||
Risk-free interest rate
|
1.8
|
%
|
|
1.2
|
%
|
|
1.3
|
%
|
|||
Expected life of options (in years)
|
4.08
|
|
|
4.00
|
|
|
4.00
|
|
|||
Expected dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|||
Weighted-average fair value (grant date) of the options
|
$
|
6.30
|
|
|
$
|
11.13
|
|
|
$
|
15.88
|
|
Options
|
|
Number of
Options
|
|
Weighted-
Average
Exercise Price
|
|
Weighted-
Average
Remaining
Contractual
Term (Years)
|
|
Aggregate
Intrinsic
Value
|
|||||
Outstanding at December 31, 2016 (restated)
|
|
2,306
|
|
|
$
|
32.43
|
|
|
|
|
|
||
Options Granted
|
|
2,891
|
|
|
$
|
15.09
|
|
|
|
|
|
||
Options Exercised
|
|
(104
|
)
|
|
$
|
11.34
|
|
|
|
|
|
||
Options Cancelled
|
|
(1,143
|
)
|
|
$
|
12.93
|
|
|
|
|
|
||
Outstanding at December 31, 2017
|
|
3,950
|
|
|
$
|
21.54
|
|
|
5.34
|
|
$
|
—
|
|
Vested and exercisable at December 31, 2017
|
|
1,185
|
|
|
$
|
32.35
|
|
|
3.26
|
|
$
|
—
|
|
|
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Total intrinsic value for stock options exercised
|
$
|
1,007
|
|
|
$
|
8,953
|
|
|
$
|
18,369
|
|
Non-Vested Restricted Stock
|
|
Number of
Awards
|
|
Weighted- Average
Grant Date
Fair Value
|
|||
Non-vested at December 31, 2016 (restated)
|
|
1,645
|
|
|
$
|
36.27
|
|
Granted
|
|
3,426
|
|
|
22.75
|
|
|
Vested
|
|
(946
|
)
|
|
32.16
|
|
|
Forfeited
|
|
(2,061
|
)
|
|
22.21
|
|
|
Non-vested at December 31, 2017
|
|
2,064
|
|
|
$
|
22.75
|
|
|
Balance at December 31, 2016
|
|
Charges
|
|
Payments
|
|
Other Adjustments
1
|
|
Balance at December 31, 2017
|
||||||||||
Employment termination costs
|
$
|
1,181
|
|
|
$
|
10,739
|
|
|
$
|
(11,404
|
)
|
|
$
|
(42
|
)
|
|
$
|
474
|
|
Facilities consolidation
|
40
|
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
24
|
|
|||||
Total
|
$
|
1,221
|
|
|
$
|
10,739
|
|
|
$
|
(11,420
|
)
|
|
$
|
(42
|
)
|
|
$
|
498
|
|
|
Balance at December 31, 2015
|
|
Charges
|
|
Payments
|
|
Other Adjustments
|
|
Balance at December 31, 2016
|
||||||||||
Employment termination costs
|
$
|
—
|
|
|
$
|
6,333
|
|
|
$
|
(5,152
|
)
|
|
—
|
|
|
$
|
1,181
|
|
|
Facilities consolidation
|
54
|
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
40
|
|
|||||
Total
|
$
|
54
|
|
|
$
|
6,333
|
|
|
$
|
(5,166
|
)
|
|
$
|
—
|
|
|
$
|
1,221
|
|
|
Balance at December 31, 2014
|
|
Charges
|
|
Payments
|
|
Other Adjustments
|
|
Balance at December 31, 2015
|
||||||||||
Employment termination costs
|
$
|
—
|
|
|
$
|
4,883
|
|
|
$
|
(4,883
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Facilities consolidation
|
—
|
|
|
63
|
|
|
(9
|
)
|
|
—
|
|
|
54
|
|
|||||
Total
|
$
|
—
|
|
|
$
|
4,946
|
|
|
$
|
(4,892
|
)
|
|
$
|
—
|
|
|
$
|
54
|
|
1
|
Includes non-cash adjustments.
|
|
Year ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
(Restated)
|
|
(Restated)
|
||||||
Domestic
|
$
|
(210,214
|
)
|
|
$
|
(116,730
|
)
|
|
$
|
(22,237
|
)
|
Foreign
|
(18,873
|
)
|
|
(10,359
|
)
|
|
(17,933
|
)
|
|||
Total
|
$
|
(229,087
|
)
|
|
$
|
(127,089
|
)
|
|
$
|
(40,170
|
)
|
|
Year ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
(Restated)
|
|
(Restated)
|
||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
600
|
|
|
$
|
4,695
|
|
|
$
|
1,866
|
|
State
|
—
|
|
|
2,098
|
|
|
299
|
|
|||
Foreign
|
(4,817
|
)
|
|
(2,743
|
)
|
|
(1,847
|
)
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
40,634
|
|
|
26,074
|
|
|
2,473
|
|
|||
State
|
1,340
|
|
|
1,301
|
|
|
103
|
|
|||
Foreign
|
(2,894
|
)
|
|
1,795
|
|
|
(506
|
)
|
|||
Income tax benefit
|
$
|
34,863
|
|
|
$
|
33,220
|
|
|
$
|
2,388
|
|
|
Year ended December 31,
|
|||||||
|
2017
|
|
2016
|
|
2015
|
|||
|
|
|
(Restated)
|
|
(Restated)
|
|||
Statutory rate
|
35
|
%
|
|
35
|
%
|
|
35
|
%
|
State taxes, net of federal benefit
|
1
|
%
|
|
3
|
%
|
|
1
|
%
|
Effect of rates different than statutory
|
(2
|
)%
|
|
(2
|
)%
|
|
(10
|
)%
|
Minority interest
|
(1
|
)%
|
|
(4
|
)%
|
|
(1
|
)%
|
Non-deductible stock based compensation
|
(2
|
)%
|
|
—
|
%
|
|
—
|
%
|
Other permanent adjustments
|
(2
|
)%
|
|
(1
|
)%
|
|
(6
|
)%
|
Research and development credit
|
—
|
%
|
|
2
|
%
|
|
5
|
%
|
Change in valuation allowance
|
(7
|
)%
|
|
(3
|
)%
|
|
(10
|
)%
|
Other
|
(2
|
)%
|
|
(1
|
)%
|
|
(3
|
)%
|
Tax Reform Rate Reduction
|
(3
|
)%
|
|
—
|
%
|
|
—
|
%
|
Acquisitions and restructuring related taxes
|
(2
|
)%
|
|
(3
|
)%
|
|
(5
|
)%
|
Net
|
15
|
%
|
|
26
|
%
|
|
6
|
%
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
|
|
(Restated)
|
||||
Deferred tax assets:
|
|
|
|
||||
Accrued liabilities
|
$
|
259
|
|
|
$
|
22
|
|
Deferred revenue
|
18,721
|
|
|
52,102
|
|
||
Bad debts reserve
|
1,103
|
|
|
556
|
|
||
Deferred compensation
|
5,635
|
|
|
12,431
|
|
||
Federal net operating loss carry forwards
|
15,324
|
|
|
18,993
|
|
||
State net operating loss carry forwards
|
4,940
|
|
|
1,737
|
|
||
Foreign net operating loss carry forwards
|
10,212
|
|
|
13,243
|
|
||
Deferred rent
|
474
|
|
|
636
|
|
||
Capital loss carry forward
|
1,541
|
|
|
229
|
|
||
Transaction costs
|
—
|
|
|
2,038
|
|
||
Other
|
2,947
|
|
|
2,155
|
|
||
Total deferred tax assets
|
$
|
61,156
|
|
|
$
|
104,142
|
|
Deferred tax liabilities:
|
|
|
|
||||
Intangible assets
|
$
|
(12,491
|
)
|
|
$
|
(16,014
|
)
|
Basis difference
|
(6,612
|
)
|
|
(12,859
|
)
|
||
Installment sale
|
(8,909
|
)
|
|
(23,177
|
)
|
||
Depreciation and amortization
|
(14,356
|
)
|
|
(28,134
|
)
|
||
Total deferred tax liabilities
|
(42,368
|
)
|
|
(80,184
|
)
|
||
Less: valuation allowance
|
(32,523
|
)
|
|
(14,180
|
)
|
||
Net deferred income tax (liabilities) assets
|
$
|
(13,735
|
)
|
|
$
|
9,778
|
|
2018-2022
|
$
|
13,700
|
|
2023-2027
|
12,669
|
|
|
2028-2037
|
127,163
|
|
|
Indefinite
|
82,612
|
|
|
|
$
|
236,144
|
|
Unrecognized tax benefit at December 31, 2014
|
$
|
3,916
|
|
Increase for tax positions taken during prior year
|
54
|
|
|
Reduction due to lapse of applicable statute of limitations
|
(68
|
)
|
|
Increases for tax positions of current period
|
376
|
|
|
Unrecognized tax benefit at December 31, 2015
|
4,278
|
|
|
Decreases for tax positions taken during prior year
|
(35
|
)
|
|
Reduction due to lapse of applicable statute of limitations
|
(57
|
)
|
|
Increases for tax positions of current period
|
399
|
|
|
Unrecognized tax benefit at December 31, 2016
|
4,585
|
|
|
Increase for tax positions taken during prior year
|
1,823
|
|
|
Increases related to acquired entities
|
13,278
|
|
|
Reduction due to lapse of applicable statute of limitations
|
(1,512
|
)
|
|
Decreases related to divested entities
|
(13,645
|
)
|
|
Increases for tax positions of current period
|
1,946
|
|
|
Unrecognized tax benefit at December 31, 2017
|
$
|
6,475
|
|
|
Year ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
Restated
|
|
Restated
|
||||||
Numerator - Basic:
|
|
|
|
|
|
||||||
Net loss from continuing operations
|
$
|
(194,224
|
)
|
|
$
|
(93,869
|
)
|
|
$
|
(37,782
|
)
|
Net (loss) income attributable to noncontrolling interests
|
(9,291
|
)
|
|
(15,203
|
)
|
|
(628
|
)
|
|||
Net (loss) income from continuing operations attributable to Synchronoss
|
(184,933
|
)
|
|
(78,666
|
)
|
|
(37,154
|
)
|
|||
|
|
|
|
|
|
||||||
Net income from discontinued operations, net of taxes
|
75,495
|
|
|
90,560
|
|
|
40,267
|
|
|||
Net (loss) income attributable to Synchronoss
|
$
|
(109,438
|
)
|
|
$
|
11,894
|
|
|
$
|
3,113
|
|
|
|
|
|
|
|
||||||
Numerator - Diluted:
|
|
|
|
|
|
||||||
Net (loss) income from continuing operations attributable to Synchronoss
|
$
|
(184,933
|
)
|
|
$
|
(78,666
|
)
|
|
$
|
(37,154
|
)
|
Income effect for interest on convertible debt, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net (loss) income from continuing operations adjusted for the convertible debt
|
(184,933
|
)
|
|
(78,666
|
)
|
|
(37,154
|
)
|
|||
|
|
|
|
|
|
||||||
Net income from discontinued operations, net of taxes
|
75,495
|
|
|
90,560
|
|
|
40,267
|
|
|||
Net income attributable to Synchronoss, adjusted for the convertible debt
|
$
|
(109,438
|
)
|
|
$
|
11,894
|
|
|
$
|
3,113
|
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
||||||
Weighted average common shares outstanding — basic
|
44,669
|
|
|
43,551
|
|
|
42,284
|
|
|||
Dilutive effect of:
|
|
|
|
|
|
||||||
Shares from assumed conversion of convertible debt
(1)
|
—
|
|
|
—
|
|
|
—
|
|
|||
Options and unvested restricted shares
|
—
|
|
|
—
|
|
|
—
|
|
|||
Weighted average common shares outstanding — diluted
|
44,669
|
|
|
43,551
|
|
|
42,284
|
|
|||
|
|
|
|
|
|
||||||
Basic EPS
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
(4.14
|
)
|
|
$
|
(1.81
|
)
|
|
$
|
(0.88
|
)
|
Discontinued operations
|
1.69
|
|
|
2.08
|
|
|
0.95
|
|
|||
|
$
|
(2.45
|
)
|
|
$
|
0.27
|
|
|
$
|
0.07
|
|
Diluted EPS
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
(4.14
|
)
|
|
$
|
(1.81
|
)
|
|
$
|
(0.88
|
)
|
Discontinued operations
|
1.69
|
|
|
2.08
|
|
|
0.95
|
|
|||
|
$
|
(2.45
|
)
|
|
$
|
0.27
|
|
|
$
|
0.07
|
|
|
|
|
|
|
|
||||||
Anti-dilutive stock options excluded:
|
$
|
2,648
|
|
|
$
|
1,310
|
|
|
$
|
556
|
|
|
Quarter Ended
|
||||||||||||||
|
March 31,
|
|
June 30,
|
|
September 30,
|
|
December 31,
|
||||||||
2017
|
(In thousands, except per share data)
|
||||||||||||||
Net revenues
|
$
|
86,097
|
|
|
$
|
118,990
|
|
|
$
|
91,015
|
|
|
$
|
106,259
|
|
Gross profit
(1)
|
40,042
|
|
|
71,235
|
|
|
45,439
|
|
|
64,192
|
|
||||
Loss from continuing operations
|
(51,347
|
)
|
|
(8,894
|
)
|
|
(36,139
|
)
|
|
(33,222
|
)
|
||||
Net (loss) income
|
(61,586
|
)
|
|
(29,383
|
)
|
|
(36,364
|
)
|
|
8,604
|
|
||||
Net (loss) income attributable to Synchronoss
(2)
|
(58,697
|
)
|
|
(26,568
|
)
|
|
(35,088
|
)
|
|
10,915
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
(3)
|
$
|
(0.96
|
)
|
|
$
|
(0.44
|
)
|
|
$
|
(0.98
|
)
|
|
$
|
(1.75
|
)
|
Discontinued operations
(3)
|
(0.37
|
)
|
|
(0.16
|
)
|
|
0.20
|
|
|
1.99
|
|
||||
|
$
|
(1.33
|
)
|
|
$
|
(0.60
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
0.24
|
|
Diluted:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
(3)
|
$
|
(0.96
|
)
|
|
$
|
(0.44
|
)
|
|
$
|
(0.98
|
)
|
|
$
|
(1.75
|
)
|
Discontinued operations
(3)
|
(0.37
|
)
|
|
(0.16
|
)
|
|
0.20
|
|
|
1.99
|
|
||||
|
$
|
(1.33
|
)
|
|
$
|
(0.60
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
0.24
|
|
|
Quarter Ended
|
||||||||||||||
(Restated)
|
March 31,
|
|
June 30,
|
|
September 30,
|
|
December 31,
|
||||||||
2016
|
(In thousands, except per share data)
|
||||||||||||||
Net revenues
|
$
|
78,246
|
|
|
$
|
121,101
|
|
|
$
|
119,936
|
|
|
$
|
107,011
|
|
Gross profit
(1)
|
32,095
|
|
|
72,921
|
|
|
70,798
|
|
|
55,796
|
|
||||
Loss from continuing operations
|
(45,343
|
)
|
|
(13,348
|
)
|
|
(12,226
|
)
|
|
(51,687
|
)
|
||||
Net (loss) income
|
(32,336
|
)
|
|
4,692
|
|
|
(785
|
)
|
|
25,120
|
|
||||
Net (loss) income attributable to Synchronoss
(2)
|
(29,329
|
)
|
|
7,832
|
|
|
2,562
|
|
|
30,829
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
(3)
|
$
|
(0.65
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
(0.74
|
)
|
Discontinued operations
(3)
|
(0.03
|
)
|
|
0.44
|
|
|
0.21
|
|
|
1.45
|
|
||||
|
$
|
(0.68
|
)
|
|
$
|
0.18
|
|
|
$
|
0.06
|
|
|
$
|
0.71
|
|
Diluted:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
(3)
|
$
|
(0.65
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
(0.74
|
)
|
Discontinued operations
(3)
|
(0.03
|
)
|
|
0.44
|
|
|
0.21
|
|
|
1.45
|
|
||||
|
$
|
(0.68
|
)
|
|
$
|
0.18
|
|
|
$
|
0.06
|
|
|
$
|
0.71
|
|
|
Quarter Ended
|
||||||||||||||
(Restated)
|
March 31,
|
|
June 30,
|
|
September 30,
|
|
December 31,
|
||||||||
2015
|
(In thousands, except per share data)
|
||||||||||||||
Net revenues
|
$
|
109,641
|
|
|
$
|
87,710
|
|
|
$
|
88,747
|
|
|
$
|
86,463
|
|
Gross profit
(1)
|
76,739
|
|
|
51,765
|
|
|
48,482
|
|
|
40,765
|
|
||||
Net income (loss) from continuing operations
|
18,267
|
|
|
(7,328
|
)
|
|
(15,955
|
)
|
|
(32,097
|
)
|
||||
Net income (loss)
|
19,738
|
|
|
7,409
|
|
|
(8,858
|
)
|
|
(15,804
|
)
|
||||
Net income (loss) attributable to Synchronoss
(2)
|
19,738
|
|
|
7,409
|
|
|
(8,858
|
)
|
|
(15,176
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
(3)
|
$
|
0.33
|
|
|
$
|
(0.39
|
)
|
|
$
|
(0.24
|
)
|
|
$
|
(0.57
|
)
|
Discontinued operations
(3)
|
0.15
|
|
|
0.56
|
|
|
0.03
|
|
|
0.22
|
|
||||
|
$
|
0.48
|
|
|
$
|
0.17
|
|
|
$
|
(0.21
|
)
|
|
$
|
(0.35
|
)
|
Diluted:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
(3)
|
$
|
0.30
|
|
|
$
|
(0.39
|
)
|
|
$
|
(0.24
|
)
|
|
$
|
(0.57
|
)
|
Discontinued operations
(3)
|
0.13
|
|
|
0.56
|
|
|
0.03
|
|
|
0.22
|
|
||||
|
$
|
0.43
|
|
|
$
|
0.17
|
|
|
$
|
(0.21
|
)
|
|
$
|
(0.35
|
)
|
(1)
|
Gross profit is defined as net revenues less cost of services and excludes depreciation and amortization expense.
|
(2)
|
Net loss for the quarter ended March 31, 2016 included a
$0.7 million
income tax expense adjustment related to the elimination of the additional paid-in-capital (“APIC”) Pool as a result of the adoption of ASU 2016-09.
|
(3)
|
Per common share amounts for the quarters and full year have been calculated separately. Accordingly, quarterly amounts do not add to the annual amount because of differences in the number of weighted-average common shares outstanding during each period which results principally from the effect of issuing shares of the Company’s common stock and options throughout the year.
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash and cash equivalents
|
$
|
123,319
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(12,975
|
)
|
|
$
|
—
|
|
|
$
|
110,344
|
|
Restricted cash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,975
|
|
|
—
|
|
|
12,975
|
|
|||||||
Marketable securities
|
16,973
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,973
|
|
|||||||
Accounts receivable, net
|
208,607
|
|
|
(155
|
)
|
|
(60,711
|
)
|
|
—
|
|
|
8,486
|
|
|
—
|
|
|
156,227
|
|
|||||||
Prepaid expenses and other current assets
|
45,972
|
|
|
—
|
|
|
—
|
|
|
862
|
|
|
(143
|
)
|
|
649
|
|
|
47,340
|
|
|||||||
Assets of discontinued operations, current
|
10,970
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,338
|
)
|
|
—
|
|
|
1,632
|
|
|||||||
Total current assets
|
405,841
|
|
|
(155
|
)
|
|
(60,711
|
)
|
|
862
|
|
|
(995
|
)
|
|
649
|
|
|
345,491
|
|
|||||||
Marketable securities
|
3,968
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,968
|
|
|||||||
Property and equipment, net
|
168,083
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,465
|
|
|
—
|
|
|
171,548
|
|
|||||||
Goodwill
|
275,914
|
|
|
—
|
|
|
—
|
|
|
(54,903
|
)
|
|
16,490
|
|
|
(3,896
|
)
|
|
233,605
|
|
|||||||
Intangible assets, net
|
215,666
|
|
|
—
|
|
|
—
|
|
|
(20,941
|
)
|
|
(8,560
|
)
|
|
—
|
|
|
186,165
|
|
|||||||
Deferred tax assets
|
1,904
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40,296
|
|
|
42,200
|
|
|||||||
Other assets
|
9,920
|
|
|
—
|
|
|
—
|
|
|
(1,315
|
)
|
|
1,451
|
|
|
—
|
|
|
10,056
|
|
|||||||
Assets of discontinued operations, non-current
|
43,433
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,655
|
)
|
|
—
|
|
|
25,778
|
|
|||||||
Total Assets
|
$
|
1,124,729
|
|
|
$
|
(155
|
)
|
|
$
|
(60,711
|
)
|
|
$
|
(76,297
|
)
|
|
$
|
(5,804
|
)
|
|
$
|
37,049
|
|
|
$
|
1,018,811
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported (Adjusted)
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Accounts payable
|
$
|
28,724
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
28,724
|
|
Accrued expenses
|
54,066
|
|
|
—
|
|
|
5,229
|
|
|
441
|
|
|
300
|
|
|
(1,505
|
)
|
|
58,531
|
|
|||||||
Deferred revenues
|
26,106
|
|
|
22,288
|
|
|
1,628
|
|
|
(4,345
|
)
|
|
2
|
|
|
—
|
|
|
45,679
|
|
|||||||
Contingent consideration obligation
|
8,229
|
|
|
—
|
|
|
—
|
|
|
(4,824
|
)
|
|
—
|
|
|
—
|
|
|
3,405
|
|
|||||||
Short-term debt
|
38,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38,000
|
|
|||||||
Total current liabilities
|
155,125
|
|
|
22,288
|
|
|
6,857
|
|
|
(8,728
|
)
|
|
302
|
|
|
(1,505
|
)
|
|
174,339
|
|
|||||||
Lease financing obligation - long term
|
13,082
|
|
|
—
|
|
|
—
|
|
|
43
|
|
|
—
|
|
|
—
|
|
|
13,125
|
|
|||||||
Convertible debt
|
225,938
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
225,938
|
|
|||||||
Deferred tax liability
|
26,397
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,380
|
)
|
|
10,017
|
|
|||||||
Deferred revenues
|
—
|
|
|
41,934
|
|
|
17,274
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59,208
|
|
|||||||
Other liabilities
|
20,399
|
|
|
—
|
|
|
(16,691
|
)
|
|
—
|
|
|
1,569
|
|
|
2,731
|
|
|
8,008
|
|
|||||||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Redeemable noncontrolling interests
|
52,616
|
|
|
—
|
|
|
—
|
|
|
(28,898
|
)
|
|
1,562
|
|
|
—
|
|
|
25,280
|
|
|||||||
Stockholder's equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Common stock
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||||
Treasury stock
|
(95,183
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,584
|
)
|
|
—
|
|
|
(96,767
|
)
|
|||||||
Additional paid-in capital
|
561,992
|
|
|
—
|
|
|
—
|
|
|
(7,667
|
)
|
|
(6,702
|
)
|
|
—
|
|
|
547,623
|
|
|||||||
Accumulated other comprehensive loss
|
(31,788
|
)
|
|
—
|
|
|
639
|
|
|
—
|
|
|
295
|
|
|
107
|
|
|
(30,747
|
)
|
|||||||
Retained earnings
|
196,148
|
|
|
(64,377
|
)
|
|
(68,790
|
)
|
|
(31,047
|
)
|
|
(1,246
|
)
|
|
52,096
|
|
|
82,784
|
|
|||||||
Total stockholders' equity
|
631,172
|
|
|
(64,377
|
)
|
|
(68,151
|
)
|
|
(38,714
|
)
|
|
(9,237
|
)
|
|
52,203
|
|
|
502,896
|
|
|||||||
Total liabilities & stockholders' equity
|
$
|
1,124,729
|
|
|
$
|
(155
|
)
|
|
$
|
(60,711
|
)
|
|
$
|
(76,297
|
)
|
|
$
|
(5,804
|
)
|
|
$
|
37,049
|
|
|
$
|
1,018,811
|
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash and cash equivalents
|
$
|
111,028
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(21,042
|
)
|
|
$
|
—
|
|
|
$
|
89,986
|
|
Restricted cash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,042
|
|
|
—
|
|
|
21,042
|
|
|||||||
Marketable securities
|
62,274
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
62,274
|
|
|||||||
Accounts receivable, net
|
154,061
|
|
|
(174
|
)
|
|
(41,754
|
)
|
|
—
|
|
|
8,110
|
|
|
—
|
|
|
120,243
|
|
|||||||
Prepaid expenses and other current assets
|
47,677
|
|
|
—
|
|
|
—
|
|
|
724
|
|
|
(142
|
)
|
|
649
|
|
|
48,908
|
|
|||||||
Assets of discontinued operations, current
|
10,595
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,963
|
)
|
|
—
|
|
|
1,632
|
|
|||||||
Total current assets
|
385,635
|
|
|
(174
|
)
|
|
(41,754
|
)
|
|
724
|
|
|
(995
|
)
|
|
649
|
|
|
344,085
|
|
|||||||
Marketable securities
|
13,949
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,949
|
|
|||||||
Property and equipment, net
|
167,135
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,372
|
|
|
—
|
|
|
170,507
|
|
|||||||
Goodwill
|
278,315
|
|
|
—
|
|
|
—
|
|
|
(54,901
|
)
|
|
16,488
|
|
|
(3,896
|
)
|
|
236,006
|
|
|||||||
Intangible assets, net
|
222,045
|
|
|
—
|
|
|
—
|
|
|
(22,052
|
)
|
|
(5,602
|
)
|
|
—
|
|
|
194,391
|
|
|||||||
Deferred tax assets
|
1,902
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32,862
|
|
|
34,764
|
|
|||||||
Other assets
|
10,050
|
|
|
—
|
|
|
—
|
|
|
(1,289
|
)
|
|
1,610
|
|
|
—
|
|
|
10,371
|
|
|||||||
Assets of discontinued operations, non-current
|
44,001
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,815
|
)
|
|
—
|
|
|
26,186
|
|
|||||||
Total Assets
|
$
|
1,123,032
|
|
|
$
|
(174
|
)
|
|
$
|
(41,754
|
)
|
|
$
|
(77,518
|
)
|
|
$
|
(2,942
|
)
|
|
$
|
29,615
|
|
|
$
|
1,030,259
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported (Adjusted)
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Accounts payable
|
$
|
35,150
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
35,150
|
|
Accrued expenses
|
52,534
|
|
|
—
|
|
|
16,005
|
|
|
285
|
|
|
300
|
|
|
(1,505
|
)
|
|
67,619
|
|
|||||||
Deferred revenues
|
28,009
|
|
|
15,494
|
|
|
1,890
|
|
|
(3,251
|
)
|
|
2
|
|
|
—
|
|
|
42,144
|
|
|||||||
Contingent consideration obligation
|
7,657
|
|
|
—
|
|
|
—
|
|
|
(2,903
|
)
|
|
—
|
|
|
—
|
|
|
4,754
|
|
|||||||
Short-term debt
|
47,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
47,000
|
|
|||||||
Total current liabilities
|
170,350
|
|
|
15,494
|
|
|
17,895
|
|
|
(5,869
|
)
|
|
302
|
|
|
(1,505
|
)
|
|
196,667
|
|
|||||||
Lease financing obligation - long term
|
13,623
|
|
|
—
|
|
|
—
|
|
|
45
|
|
|
—
|
|
|
—
|
|
|
13,668
|
|
|||||||
Convertible debt
|
225,585
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
225,585
|
|
|||||||
Deferred tax liability
|
29,716
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,380
|
)
|
|
13,336
|
|
|||||||
Deferred revenues
|
—
|
|
|
42,266
|
|
|
19,241
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
61,507
|
|
|||||||
Other liabilities
|
22,545
|
|
|
—
|
|
|
(18,585
|
)
|
|
—
|
|
|
1,633
|
|
|
2,731
|
|
|
8,324
|
|
|||||||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Redeemable noncontrolling interests
|
55,459
|
|
|
—
|
|
|
—
|
|
|
(28,982
|
)
|
|
(1,197
|
)
|
|
—
|
|
|
25,280
|
|
|||||||
Stockholder's equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Common stock
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||||
Treasury stock
|
(95,812
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,676
|
)
|
|
—
|
|
|
(98,488
|
)
|
|||||||
Additional paid-in capital
|
547,970
|
|
|
—
|
|
|
—
|
|
|
(7,667
|
)
|
|
45
|
|
|
—
|
|
|
540,348
|
|
|||||||
Accumulated other comprehensive loss
|
(34,880
|
)
|
|
—
|
|
|
670
|
|
|
—
|
|
|
295
|
|
|
107
|
|
|
(33,808
|
)
|
|||||||
Retained earnings
|
188,472
|
|
|
(57,934
|
)
|
|
(60,975
|
)
|
|
(35,045
|
)
|
|
(1,344
|
)
|
|
44,662
|
|
|
77,836
|
|
|||||||
Total stockholders' equity
|
605,754
|
|
|
(57,934
|
)
|
|
(60,305
|
)
|
|
(42,712
|
)
|
|
(3,680
|
)
|
|
44,769
|
|
|
485,892
|
|
|||||||
Total liabilities & stockholders' equity
|
$
|
1,123,032
|
|
|
$
|
(174
|
)
|
|
$
|
(41,754
|
)
|
|
$
|
(77,518
|
)
|
|
$
|
(2,942
|
)
|
|
$
|
29,615
|
|
|
$
|
1,030,259
|
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cash and cash equivalents
|
$
|
113,084
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(26,302
|
)
|
|
$
|
—
|
|
|
$
|
86,782
|
|
Restricted cash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,302
|
|
|
—
|
|
|
26,302
|
|
|||||||
Marketable securities
|
63,713
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
63,713
|
|
|||||||
Accounts receivable, net
|
150,790
|
|
|
(42
|
)
|
|
(42,041
|
)
|
|
—
|
|
|
7,659
|
|
|
—
|
|
|
116,366
|
|
|||||||
Prepaid expenses and other current assets
|
53,236
|
|
|
—
|
|
|
—
|
|
|
420
|
|
|
(817
|
)
|
|
649
|
|
|
53,488
|
|
|||||||
Assets of discontinued operations, current
|
9,503
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,415
|
)
|
|
—
|
|
|
1,088
|
|
|||||||
Total current assets
|
390,326
|
|
|
(42
|
)
|
|
(42,041
|
)
|
|
420
|
|
|
(1,573
|
)
|
|
649
|
|
|
347,739
|
|
|||||||
Marketable securities
|
17,934
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,934
|
|
|||||||
Property and equipment, net
|
162,040
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,580
|
|
|
—
|
|
|
165,620
|
|
|||||||
Goodwill
|
271,666
|
|
|
—
|
|
|
—
|
|
|
(55,637
|
)
|
|
16,488
|
|
|
(3,896
|
)
|
|
228,621
|
|
|||||||
Intangible assets, net
|
230,986
|
|
|
—
|
|
|
—
|
|
|
(23,163
|
)
|
|
(3,462
|
)
|
|
—
|
|
|
204,361
|
|
|||||||
Deferred tax assets
|
5,176
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,257
|
|
|
30,433
|
|
|||||||
Other assets
|
10,867
|
|
|
—
|
|
|
—
|
|
|
(420
|
)
|
|
1,768
|
|
|
—
|
|
|
12,215
|
|
|||||||
Assets of discontinued operations, non-current
|
44,568
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,974
|
)
|
|
—
|
|
|
26,594
|
|
|||||||
Total Assets
|
$
|
1,133,563
|
|
|
$
|
(42
|
)
|
|
$
|
(42,041
|
)
|
|
$
|
(78,800
|
)
|
|
$
|
(1,173
|
)
|
|
$
|
22,010
|
|
|
$
|
1,033,517
|
|
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported (Adjusted)
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Accounts payable
|
$
|
33,171
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
33,171
|
|
Accrued expenses
|
48,695
|
|
|
—
|
|
|
29,763
|
|
|
(11
|
)
|
|
299
|
|
|
(1,504
|
)
|
|
77,242
|
|
|||||||
Deferred revenues
|
32,113
|
|
|
8,860
|
|
|
1,378
|
|
|
(3,777
|
)
|
|
75
|
|
|
—
|
|
|
38,649
|
|
|||||||
Contingent consideration obligation
|
1,271
|
|
|
—
|
|
|
—
|
|
|
373
|
|
|
—
|
|
|
—
|
|
|
1,644
|
|
|||||||
Short-term debt
|
50,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
50,000
|
|
|||||||
Total current liabilities
|
165,250
|
|
|
8,860
|
|
|
31,141
|
|
|
(3,415
|
)
|
|
374
|
|
|
(1,504
|
)
|
|
200,706
|
|
|||||||
Lease financing obligation - long term
|
14,047
|
|
|
—
|
|
|
—
|
|
|
47
|
|
|
—
|
|
|
—
|
|
|
14,094
|
|
|||||||
Convertible debt
|
225,231
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
225,231
|
|
|||||||
Deferred tax liability
|
23,096
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,380
|
)
|
|
6,716
|
|
|||||||
Deferred revenues
|
—
|
|
|
36,039
|
|
|
6,646
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42,685
|
|
|||||||
Other liabilities
|
19,900
|
|
|
—
|
|
|
(4,114
|
)
|
|
—
|
|
|
1,696
|
|
|
2,731
|
|
|
20,213
|
|
|||||||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Redeemable noncontrolling interests
|
58,323
|
|
|
—
|
|
|
—
|
|
|
(29,066
|
)
|
|
(3,977
|
)
|
|
—
|
|
|
25,280
|
|
|||||||
Stockholder's equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Common stock
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||||
Treasury stock
|
(72,368
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,676
|
)
|
|
—
|
|
|
(75,044
|
)
|
|||||||
Additional paid-in capital
|
535,945
|
|
|
—
|
|
|
—
|
|
|
(7,667
|
)
|
|
7,248
|
|
|
—
|
|
|
535,526
|
|
|||||||
Accumulated other comprehensive loss
|
(29,254
|
)
|
|
—
|
|
|
562
|
|
|
—
|
|
|
294
|
|
|
107
|
|
|
(28,291
|
)
|
|||||||
Retained earnings
|
193,389
|
|
|
(44,941
|
)
|
|
(76,276
|
)
|
|
(38,699
|
)
|
|
(4,132
|
)
|
|
37,056
|
|
|
66,397
|
|
|||||||
Total stockholders' equity
|
627,716
|
|
|
(44,941
|
)
|
|
(75,714
|
)
|
|
(46,366
|
)
|
|
734
|
|
|
37,163
|
|
|
498,592
|
|
|||||||
Total liabilities & stockholders' equity
|
$
|
1,133,563
|
|
|
$
|
(42
|
)
|
|
$
|
(42,041
|
)
|
|
$
|
(78,800
|
)
|
|
$
|
(1,173
|
)
|
|
$
|
22,010
|
|
|
$
|
1,033,517
|
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
121,796
|
|
|
$
|
(22,331
|
)
|
|
$
|
18,958
|
|
|
$
|
(11,412
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
107,011
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
50,210
|
|
|
—
|
|
|
—
|
|
|
64
|
|
|
941
|
|
|
—
|
|
|
51,215
|
|
|||||||
Research and development
|
28,273
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,316
|
|
|
—
|
|
|
29,589
|
|
|||||||
Selling, general and administrative
|
43,297
|
|
|
—
|
|
|
(1,752
|
)
|
|
(75
|
)
|
|
137
|
|
|
—
|
|
|
41,607
|
|
|||||||
Net change in contingent consideration obligation
|
3,631
|
|
|
—
|
|
|
—
|
|
|
(4,203
|
)
|
|
—
|
|
|
—
|
|
|
(572
|
)
|
|||||||
Restructuring charges
|
1,360
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,360
|
|
|||||||
Depreciation and amortization
|
25,302
|
|
|
—
|
|
|
—
|
|
|
(1,119
|
)
|
|
11,316
|
|
|
—
|
|
|
35,499
|
|
|||||||
Total costs and expenses
|
152,073
|
|
|
—
|
|
|
(1,752
|
)
|
|
(5,333
|
)
|
|
13,710
|
|
|
—
|
|
|
158,698
|
|
|||||||
Loss from continuing operations
|
(30,277
|
)
|
|
(22,331
|
)
|
|
20,710
|
|
|
(6,079
|
)
|
|
(13,710
|
)
|
|
—
|
|
|
(51,687
|
)
|
|||||||
Interest income
|
936
|
|
|
—
|
|
|
—
|
|
|
(340
|
)
|
|
(181
|
)
|
|
—
|
|
|
415
|
|
|||||||
Interest expense
|
(2,007
|
)
|
|
—
|
|
|
—
|
|
|
374
|
|
|
200
|
|
|
(975
|
)
|
|
(2,408
|
)
|
|||||||
Other expense, net
|
2,049
|
|
|
—
|
|
|
(69
|
)
|
|
(830
|
)
|
|
(264
|
)
|
|
—
|
|
|
886
|
|
|||||||
Loss from continuing operations, before taxes
|
(29,299
|
)
|
|
(22,331
|
)
|
|
20,641
|
|
|
(6,875
|
)
|
|
(13,955
|
)
|
|
(975
|
)
|
|
(52,794
|
)
|
|||||||
Benefit for income taxes
|
7,176
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,284
|
|
|
14,460
|
|
|||||||
Net loss from continuing operations
|
(22,123
|
)
|
|
(22,331
|
)
|
|
20,641
|
|
|
(6,875
|
)
|
|
(13,955
|
)
|
|
6,309
|
|
|
(38,334
|
)
|
|||||||
Net income from discontinued operations, net of tax
|
43,668
|
|
|
—
|
|
|
5,329
|
|
|
18,116
|
|
|
—
|
|
|
(3,659
|
)
|
|
63,454
|
|
|||||||
Net loss
|
21,545
|
|
|
(22,331
|
)
|
|
25,970
|
|
|
11,241
|
|
|
(13,955
|
)
|
|
2,650
|
|
|
25,120
|
|
|||||||
Net loss attributable to redeemable noncontrolling interests
|
(2,760
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,949
|
)
|
|
—
|
|
(5,709
|
)
|
||||||||
Net loss attributable to Synchronoss
|
$
|
24,305
|
|
|
$
|
(22,331
|
)
|
|
$
|
25,970
|
|
|
$
|
11,241
|
|
|
$
|
(11,006
|
)
|
|
$
|
2,650
|
|
|
$
|
30,829
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.44
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.74
|
)
|
||||||||||
Discontinued operations
|
0.99
|
|
|
|
|
|
|
|
|
|
|
|
|
1.45
|
|
||||||||||||
|
$
|
0.55
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.71
|
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.44
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.74
|
)
|
||||||||||
Discontinued operations
|
0.99
|
|
|
|
|
|
|
|
|
|
|
|
|
1.45
|
|
||||||||||||
|
$
|
0.55
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.71
|
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic
|
43,814
|
|
|
|
|
|
|
|
|
|
|
|
|
43,814
|
|
||||||||||||
Diluted
|
43,814
|
|
|
|
|
|
|
|
|
|
|
|
|
43,814
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
**
|
Certain amounts reflected in this column have been adjusted for retrospective application of discontinued operations.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
132,480
|
|
|
$
|
(6,440
|
)
|
|
$
|
(7,648
|
)
|
|
$
|
1,544
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
119,936
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
49,073
|
|
|
—
|
|
|
—
|
|
|
65
|
|
|
—
|
|
|
—
|
|
|
49,138
|
|
|||||||
Research and development
|
28,141
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,889
|
|
|
—
|
|
|
31,030
|
|
|||||||
Selling, general and administrative
|
30,934
|
|
|
2
|
|
|
(2,246
|
)
|
|
156
|
|
|
(19
|
)
|
|
—
|
|
|
28,827
|
|
|||||||
Net change in contingent consideration obligation
|
572
|
|
|
—
|
|
|
—
|
|
|
(1,921
|
)
|
|
—
|
|
|
—
|
|
|
(1,349
|
)
|
|||||||
Restructuring charges
|
924
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
924
|
|
|||||||
Depreciation and amortization
|
24,692
|
|
|
—
|
|
|
—
|
|
|
(1,111
|
)
|
|
11
|
|
|
—
|
|
|
23,592
|
|
|||||||
Total costs and expenses
|
134,336
|
|
|
2
|
|
|
(2,246
|
)
|
|
(2,811
|
)
|
|
2,881
|
|
|
—
|
|
|
132,162
|
|
|||||||
Loss from continuing operations
|
(1,856
|
)
|
|
(6,442
|
)
|
|
(5,402
|
)
|
|
4,355
|
|
|
(2,881
|
)
|
|
—
|
|
|
(12,226
|
)
|
|||||||
Interest income
|
271
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
271
|
|
|||||||
Interest expense
|
(1,596
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,596
|
)
|
|||||||
Other expense, net
|
(167
|
)
|
|
—
|
|
|
16
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(151
|
)
|
|||||||
Loss from continuing operations, before taxes
|
(3,348
|
)
|
|
(6,442
|
)
|
|
(5,386
|
)
|
|
4,355
|
|
|
(2,881
|
)
|
|
—
|
|
|
(13,702
|
)
|
|||||||
Benefit for income taxes
|
(1,621
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,231
|
|
|
3,610
|
|
|||||||
Net loss from continuing operations
|
(4,969
|
)
|
|
(6,442
|
)
|
|
(5,386
|
)
|
|
4,355
|
|
|
(2,881
|
)
|
|
5,231
|
|
|
(10,092
|
)
|
|||||||
Net income from discontinued operations, net of tax
|
9,802
|
|
|
—
|
|
|
(2,427
|
)
|
|
(272
|
)
|
|
(1
|
)
|
|
2,205
|
|
|
9,307
|
|
|||||||
Net loss
|
4,833
|
|
|
(6,442
|
)
|
|
(7,813
|
)
|
|
4,083
|
|
|
(2,882
|
)
|
|
7,436
|
|
|
(785
|
)
|
|||||||
Net loss attributable to redeemable noncontrolling interests
|
(2,843
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(504
|
)
|
|
—
|
|
(3,347
|
)
|
||||||||
Net loss attributable to Synchronoss
|
$
|
7,676
|
|
|
$
|
(6,442
|
)
|
|
$
|
(7,813
|
)
|
|
$
|
4,083
|
|
|
$
|
(2,378
|
)
|
|
$
|
7,436
|
|
|
$
|
2,562
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.05
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.15
|
)
|
||||||||||
Discontinued operations
|
0.23
|
|
|
|
|
|
|
|
|
|
|
|
|
0.21
|
|
||||||||||||
|
$
|
0.18
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.06
|
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.05
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.15
|
)
|
||||||||||
Discontinued operations
|
0.23
|
|
|
|
|
|
|
|
|
|
|
|
|
0.21
|
|
||||||||||||
|
$
|
0.18
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.06
|
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
43,560
|
|
|
|
|
|
|
|
|
|
|
|
|
43,560
|
|
||||||||||||
Diluted
|
43,560
|
|
|
|
|
|
|
|
|
|
|
|
|
43,560
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
**
|
Certain amounts reflected in this column have been adjusted for retrospective application of discontinued operations.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
118,255
|
|
|
$
|
(12,840
|
)
|
|
$
|
16,211
|
|
|
$
|
(525
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
121,101
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
48,467
|
|
|
—
|
|
|
—
|
|
|
(171
|
)
|
|
(116
|
)
|
|
—
|
|
|
48,180
|
|
|||||||
Research and development
|
26,170
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,877
|
|
|
—
|
|
|
28,047
|
|
|||||||
Selling, general and administrative
|
29,952
|
|
|
153
|
|
|
(472
|
)
|
|
296
|
|
|
(49
|
)
|
|
—
|
|
|
29,880
|
|
|||||||
Net change in contingent consideration obligation
|
6,386
|
|
|
—
|
|
|
—
|
|
|
(3,276
|
)
|
|
—
|
|
|
—
|
|
|
3,110
|
|
|||||||
Restructuring charges
|
1,139
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,139
|
|
|||||||
Depreciation and amortization
|
25,262
|
|
|
—
|
|
|
—
|
|
|
(1,111
|
)
|
|
(58
|
)
|
|
—
|
|
|
24,093
|
|
|||||||
Total costs and expenses
|
137,376
|
|
|
153
|
|
|
(472
|
)
|
|
(4,262
|
)
|
|
1,654
|
|
|
—
|
|
|
134,449
|
|
|||||||
Loss from continuing operations
|
(19,121
|
)
|
|
(12,993
|
)
|
|
16,683
|
|
|
3,737
|
|
|
(1,654
|
)
|
|
—
|
|
|
(13,348
|
)
|
|||||||
Interest income
|
591
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
591
|
|
|||||||
Interest expense
|
(1,834
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,834
|
)
|
|||||||
Other expense, net
|
865
|
|
|
—
|
|
|
(197
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
668
|
|
|||||||
Loss from continuing operations, before taxes
|
(19,499
|
)
|
|
(12,993
|
)
|
|
16,486
|
|
|
3,737
|
|
|
(1,654
|
)
|
|
—
|
|
|
(13,923
|
)
|
|||||||
Benefit for income taxes
|
2,074
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,444
|
)
|
|
(370
|
)
|
|||||||
Net loss from continuing operations
|
(17,425
|
)
|
|
(12,993
|
)
|
|
16,486
|
|
|
3,737
|
|
|
(1,654
|
)
|
|
(2,444
|
)
|
|
(14,293
|
)
|
|||||||
Net income from discontinued operations, net of tax
|
10,122
|
|
|
—
|
|
|
(1,188
|
)
|
|
—
|
|
|
1
|
|
|
10,050
|
|
|
18,985
|
|
|||||||
Net loss
|
(7,303
|
)
|
|
(12,993
|
)
|
|
15,298
|
|
|
3,737
|
|
|
(1,653
|
)
|
|
7,606
|
|
|
4,692
|
|
|||||||
Net loss attributable to redeemable noncontrolling interests
|
(2,864
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(276
|
)
|
|
—
|
|
(3,140
|
)
|
||||||||
Net loss attributable to Synchronoss
|
$
|
(4,439
|
)
|
|
$
|
(12,993
|
)
|
|
$
|
15,298
|
|
|
$
|
3,737
|
|
|
$
|
(1,377
|
)
|
|
$
|
7,606
|
|
|
$
|
7,832
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.34
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.26
|
)
|
||||||||||
Discontinued operations
|
0.24
|
|
|
|
|
|
|
|
|
|
|
|
|
0.44
|
|
||||||||||||
|
$
|
(0.10
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.18
|
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.34
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.26
|
)
|
||||||||||
Discontinued operations
|
0.24
|
|
|
|
|
|
|
|
|
|
|
|
|
0.44
|
|
||||||||||||
|
$
|
(0.10
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.18
|
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
43,450
|
|
|
|
|
|
|
|
|
|
|
|
|
43,450
|
|
||||||||||||
Diluted
|
43,450
|
|
|
|
|
|
|
|
|
|
|
|
|
43,450
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
**
|
Certain amounts reflected in this column have been adjusted for retrospective application of discontinued operations.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
104,219
|
|
|
$
|
2,119
|
|
|
$
|
(18,086
|
)
|
|
$
|
(10,006
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
78,246
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
46,448
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(296
|
)
|
|
—
|
|
|
46,151
|
|
|||||||
Research and development
|
24,097
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,730
|
|
|
—
|
|
|
25,827
|
|
|||||||
Selling, general and administrative
|
26,923
|
|
|
—
|
|
|
—
|
|
|
84
|
|
|
(1,093
|
)
|
|
—
|
|
|
25,914
|
|
|||||||
Net change in contingent consideration obligation
|
341
|
|
|
—
|
|
|
—
|
|
|
(336
|
)
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||||
Restructuring charges
|
2,910
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,910
|
|
|||||||
Depreciation and amortization
|
24,055
|
|
|
—
|
|
|
—
|
|
|
(1,111
|
)
|
|
(162
|
)
|
|
—
|
|
|
22,782
|
|
|||||||
Total costs and expenses
|
124,774
|
|
|
—
|
|
|
—
|
|
|
(1,364
|
)
|
|
179
|
|
|
—
|
|
|
123,589
|
|
|||||||
Loss from continuing operations
|
(20,555
|
)
|
|
2,119
|
|
|
(18,086
|
)
|
|
(8,642
|
)
|
|
(179
|
)
|
|
—
|
|
|
(45,343
|
)
|
|||||||
Interest income
|
630
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
630
|
|
|||||||
Interest expense
|
(1,576
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,576
|
)
|
|||||||
Other expense, net
|
(884
|
)
|
|
—
|
|
|
503
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(381
|
)
|
|||||||
Loss from continuing operations, before taxes
|
(22,385
|
)
|
|
2,119
|
|
|
(17,583
|
)
|
|
(8,642
|
)
|
|
(179
|
)
|
|
—
|
|
|
(46,670
|
)
|
|||||||
Benefit for income taxes
|
361
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,159
|
|
|
15,520
|
|
|||||||
Net loss from continuing operations
|
(22,024
|
)
|
|
2,119
|
|
|
(17,583
|
)
|
|
(8,642
|
)
|
|
(179
|
)
|
|
15,159
|
|
|
(31,150
|
)
|
|||||||
Net income from discontinued operations, net of tax
|
10,941
|
|
|
—
|
|
|
(2,111
|
)
|
|
—
|
|
|
—
|
|
|
(10,016
|
)
|
|
(1,186
|
)
|
|||||||
Net loss
|
(11,083
|
)
|
|
2,119
|
|
|
(19,694
|
)
|
|
(8,642
|
)
|
|
(179
|
)
|
|
5,143
|
|
|
(32,336
|
)
|
|||||||
Net loss attributable to redeemable noncontrolling interests
|
(3,129
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
122
|
|
|
—
|
|
|
(3,007
|
)
|
|||||||
Net loss attributable to Synchronoss
|
$
|
(7,954
|
)
|
|
$
|
2,119
|
|
|
$
|
(19,694
|
)
|
|
$
|
(8,642
|
)
|
|
$
|
(301
|
)
|
|
$
|
5,143
|
|
|
$
|
(29,329
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.44
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.65
|
)
|
||||||||||
Discontinued operations
|
0.26
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.03
|
)
|
||||||||||||
|
$
|
(0.18
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.68
|
)
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.44
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.65
|
)
|
||||||||||
Discontinued operations
|
0.26
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.03
|
)
|
||||||||||||
|
$
|
(0.18
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.68
|
)
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
43,423
|
|
|
|
|
|
|
|
|
|
|
|
|
43,423
|
|
||||||||||||
Diluted
|
43,423
|
|
|
|
|
|
|
|
|
|
|
|
|
43,423
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
**
|
Certain amounts reflected in this column have been adjusted for retrospective application of discontinued operations.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
121,213
|
|
|
$
|
(2,519
|
)
|
|
$
|
(12,141
|
)
|
|
$
|
(20,090
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
86,463
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
45,512
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|
203
|
|
|
—
|
|
|
45,698
|
|
|||||||
Research and development
|
22,958
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,235
|
|
|
—
|
|
|
24,193
|
|
|||||||
Selling, general and administrative
|
29,539
|
|
|
—
|
|
|
(3,042
|
)
|
|
—
|
|
|
8
|
|
|
—
|
|
|
26,505
|
|
|||||||
Net change in contingent consideration obligation
|
760
|
|
|
—
|
|
|
—
|
|
|
755
|
|
|
—
|
|
|
—
|
|
|
1,515
|
|
|||||||
Restructuring charges
|
(34
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(34
|
)
|
|||||||
Depreciation and amortization
|
20,931
|
|
|
—
|
|
|
—
|
|
|
(76
|
)
|
|
(172
|
)
|
|
—
|
|
|
20,683
|
|
|||||||
Total costs and expenses
|
119,666
|
|
|
—
|
|
|
(3,042
|
)
|
|
662
|
|
|
1,274
|
|
|
—
|
|
|
118,560
|
|
|||||||
Loss from continuing operations
|
1,547
|
|
|
(2,519
|
)
|
|
(9,099
|
)
|
|
(20,752
|
)
|
|
(1,274
|
)
|
|
—
|
|
|
(32,097
|
)
|
|||||||
Interest income
|
564
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
564
|
|
|||||||
Interest expense
|
(1,503
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,503
|
)
|
|||||||
Other expense, net
|
973
|
|
|
—
|
|
|
(149
|
)
|
|
(16
|
)
|
|
—
|
|
|
—
|
|
|
808
|
|
|||||||
Loss from continuing operations, before taxes
|
1,581
|
|
|
(2,519
|
)
|
|
(9,248
|
)
|
|
(20,768
|
)
|
|
(1,274
|
)
|
|
—
|
|
|
(32,228
|
)
|
|||||||
Benefit for income taxes
|
2,263
|
|
|
—
|
|
|
(534
|
)
|
|
—
|
|
|
—
|
|
|
5,381
|
|
|
7,110
|
|
|||||||
Net loss from continuing operations
|
3,844
|
|
|
(2,519
|
)
|
|
(9,782
|
)
|
|
(20,768
|
)
|
|
(1,274
|
)
|
|
5,381
|
|
|
(25,118
|
)
|
|||||||
Net income from discontinued operations, net of tax
|
7,478
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,836
|
|
|
9,314
|
|
|||||||
Net loss
|
11,322
|
|
|
(2,519
|
)
|
|
(9,782
|
)
|
|
(20,768
|
)
|
|
(1,274
|
)
|
|
7,217
|
|
|
(15,804
|
)
|
|||||||
Net loss attributable to redeemable noncontrolling interests
|
6,052
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,680
|
)
|
|
—
|
|
|
(628
|
)
|
|||||||
Net loss attributable to Synchronoss
|
$
|
5,270
|
|
|
$
|
(2,519
|
)
|
|
$
|
(9,782
|
)
|
|
$
|
(20,768
|
)
|
|
$
|
5,406
|
|
|
$
|
7,217
|
|
|
$
|
(15,176
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.05
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.57
|
)
|
||||||||||
Discontinued operations
|
0.17
|
|
|
|
|
|
|
|
|
|
|
|
|
0.22
|
|
||||||||||||
|
$
|
0.12
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.35
|
)
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.05
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.57
|
)
|
||||||||||
Discontinued operations
|
0.17
|
|
|
|
|
|
|
|
|
|
|
|
|
0.22
|
|
||||||||||||
|
$
|
0.12
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1.26
|
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic
|
42,817
|
|
|
|
|
|
|
|
|
|
|
|
|
42,817
|
|
||||||||||||
Diluted
|
42,817
|
|
|
|
|
|
|
|
|
|
|
|
|
42,817
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
**
|
Certain amounts reflected in this column have been adjusted for retrospective application of discontinued operations.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
109,297
|
|
|
$
|
(2,355
|
)
|
|
$
|
(18,195
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
88,747
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
40,223
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42
|
|
|
—
|
|
|
40,265
|
|
|||||||
Research and development
|
23,986
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
165
|
|
|
—
|
|
|
24,151
|
|
|||||||
Selling, general and administrative
|
20,410
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(71
|
)
|
|
—
|
|
|
20,339
|
|
|||||||
Restructuring charges
|
359
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
359
|
|
|||||||
Depreciation and amortization
|
19,754
|
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
|
(146
|
)
|
|
—
|
|
|
19,588
|
|
|||||||
Total costs and expenses
|
104,732
|
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
|
(10
|
)
|
|
—
|
|
|
104,702
|
|
|||||||
Loss from continuing operations
|
4,565
|
|
|
(2,355
|
)
|
|
(18,195
|
)
|
|
20
|
|
|
10
|
|
|
—
|
|
|
(15,955
|
)
|
|||||||
Interest income
|
546
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
546
|
|
|||||||
Interest expense
|
(1,448
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,448
|
)
|
|||||||
Other expense, net
|
(1,030
|
)
|
|
—
|
|
|
109
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(921
|
)
|
|||||||
Loss from continuing operations, before taxes
|
2,633
|
|
|
(2,355
|
)
|
|
(18,086
|
)
|
|
20
|
|
|
10
|
|
|
—
|
|
|
(17,778
|
)
|
|||||||
Benefit for income taxes
|
(4,448
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,228
|
|
|
7,780
|
|
|||||||
Net loss from continuing operations
|
(1,815
|
)
|
|
(2,355
|
)
|
|
(18,086
|
)
|
|
20
|
|
|
10
|
|
|
12,228
|
|
|
(9,998
|
)
|
|||||||
Net income from discontinued operations, net of tax
|
11,460
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,320
|
)
|
|
1,140
|
|
|||||||
Net loss
|
9,645
|
|
|
(2,355
|
)
|
|
(18,086
|
)
|
|
20
|
|
|
10
|
|
|
1,908
|
|
|
(8,858
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.04
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.24
|
)
|
||||||||||
Discontinued operations
|
0.27
|
|
|
|
|
|
|
|
|
|
|
|
|
0.03
|
|
||||||||||||
|
$
|
0.23
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.21
|
)
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.04
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.24
|
)
|
||||||||||
Discontinued operations
|
$
|
0.27
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.03
|
|
||||||||||
|
$
|
0.23
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.21
|
)
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
42,491
|
|
|
|
|
|
|
|
|
|
|
|
|
42,491
|
|
||||||||||||
Diluted
|
42,491
|
|
|
|
|
|
|
|
|
|
|
|
|
42,491
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
**
|
Certain amounts reflected in this column have been adjusted for retrospective application of discontinued operations.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
102,176
|
|
|
$
|
(5,586
|
)
|
|
$
|
(8,880
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
87,710
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
35,945
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35,945
|
|
|||||||
Research and development
|
22,462
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
22,466
|
|
|||||||
Selling, general and administrative
|
18,147
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
468
|
|
|
—
|
|
|
18,615
|
|
|||||||
Restructuring charges
|
1,416
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,416
|
|
|||||||
Depreciation and amortization
|
16,632
|
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
|
(16
|
)
|
|
—
|
|
|
16,596
|
|
|||||||
Total costs and expenses
|
94,602
|
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
|
456
|
|
|
—
|
|
|
95,038
|
|
|||||||
Loss from continuing operations
|
7,574
|
|
|
(5,586
|
)
|
|
(8,880
|
)
|
|
20
|
|
|
(456
|
)
|
|
—
|
|
|
(7,328
|
)
|
|||||||
Interest income
|
471
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
471
|
|
|||||||
Interest expense
|
(1,418
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,418
|
)
|
|||||||
Other expense, net
|
415
|
|
|
—
|
|
|
57
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
472
|
|
|||||||
Loss from continuing operations, before taxes
|
7,042
|
|
|
(5,586
|
)
|
|
(8,823
|
)
|
|
20
|
|
|
(456
|
)
|
|
—
|
|
|
(7,803
|
)
|
|||||||
Benefit for income taxes
|
(2,309
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,101
|
)
|
|
(8,410
|
)
|
|||||||
Net loss from continuing operations
|
4,733
|
|
|
(5,586
|
)
|
|
(8,823
|
)
|
|
20
|
|
|
(456
|
)
|
|
(6,101
|
)
|
|
(16,213
|
)
|
|||||||
Net income from discontinued operations, net of tax
|
10,421
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,201
|
|
|
23,622
|
|
|||||||
Net loss
|
15,154
|
|
|
(5,586
|
)
|
|
(8,823
|
)
|
|
20
|
|
|
(456
|
)
|
|
7,100
|
|
|
7,409
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
0.11
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.39
|
)
|
||||||||||
Discontinued operations
|
0.25
|
|
|
|
|
|
|
|
|
|
|
|
|
0.56
|
|
||||||||||||
|
$
|
0.36
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.17
|
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
0.11
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(0.39
|
)
|
||||||||||
Discontinued operations
|
0.25
|
|
|
|
|
|
|
|
|
|
|
|
|
0.56
|
|
||||||||||||
|
$
|
0.36
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.17
|
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
41,870
|
|
|
|
|
|
|
|
|
|
|
|
|
41,870
|
|
||||||||||||
Diluted
|
41,870
|
|
|
|
|
|
|
|
|
|
|
|
|
41,870
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
**
|
Certain amounts reflected in this column have been adjusted for retrospective application of discontinued operations.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
(Unaudited)
|
|
|
Adjustments
|
|
|
||||||||||||||||||||||
|
As Previously Reported**
|
|
Revenue - Hosting
|
|
Revenue - Evidence of Arrangement and Other Revenue
|
|
Acquisitions & Divestiture
|
|
Capitalized Software and Other
|
|
Income Taxes
|
|
As Adjusted
|
||||||||||||||
Net revenues
|
$
|
95,431
|
|
|
$
|
(16,448
|
)
|
|
$
|
40,658
|
|
|
$
|
(10,000
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
109,641
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of services
|
33,607
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(705
|
)
|
|
—
|
|
|
32,902
|
|
|||||||
Research and development
|
22,024
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(71
|
)
|
|
—
|
|
|
21,953
|
|
|||||||
Selling, general and administrative
|
20,315
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,183
|
)
|
|
—
|
|
|
19,132
|
|
|||||||
Restructuring charges
|
3,205
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,205
|
|
|||||||
Depreciation and amortization
|
14,835
|
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
|
(633
|
)
|
|
—
|
|
|
14,182
|
|
|||||||
Total costs and expenses
|
93,986
|
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
|
(2,592
|
)
|
|
—
|
|
|
91,374
|
|
|||||||
Loss from continuing operations
|
1,445
|
|
|
(16,448
|
)
|
|
40,658
|
|
|
(9,980
|
)
|
|
2,592
|
|
|
—
|
|
|
18,267
|
|
|||||||
Interest income
|
466
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
466
|
|
|||||||
Interest expense
|
(1,342
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,342
|
)
|
|||||||
Other expense, net
|
14
|
|
|
—
|
|
|
(69
|
)
|
|
—
|
|
|
303
|
|
|
—
|
|
|
248
|
|
|||||||
Loss from continuing operations, before taxes
|
583
|
|
|
(16,448
|
)
|
|
40,589
|
|
|
(9,980
|
)
|
|
2,895
|
|
|
—
|
|
|
17,639
|
|
|||||||
Benefit for income taxes
|
(930
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,162
|
)
|
|
(4,092
|
)
|
|||||||
Net loss from continuing operations
|
(347
|
)
|
|
(16,448
|
)
|
|
40,589
|
|
|
(9,980
|
)
|
|
2,895
|
|
|
(3,162
|
)
|
|
13,547
|
|
|||||||
Net income from discontinued operations, net of tax
|
10,908
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,717
|
)
|
|
6,191
|
|
|||||||
Net loss
|
10,561
|
|
|
(16,448
|
)
|
|
40,589
|
|
|
(9,980
|
)
|
|
2,895
|
|
|
(7,879
|
)
|
|
19,738
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.33
|
|
||||||||||
Discontinued operations
|
0.26
|
|
|
|
|
|
|
|
|
|
|
|
|
0.15
|
|
||||||||||||
|
$
|
0.25
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.48
|
|
||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Continuing operations
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.30
|
|
||||||||||
Discontinued operations
|
0.26
|
|
|
|
|
|
|
|
|
|
|
|
|
0.13
|
|
||||||||||||
|
$
|
0.25
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
0.43
|
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
41,626
|
|
|
|
|
|
|
|
|
|
|
|
|
41,626
|
|
||||||||||||
Diluted
|
47,080
|
|
|
|
|
|
|
|
|
|
|
|
|
47,080
|
|
*
|
Cost of services excludes depreciation and amortization which is shown separately.
|
**
|
Certain amounts reflected in this column have been adjusted for retrospective application of discontinued operations.
|
†
|
See
Note 3 - Summary of Significant Accounting Policies
.
|
•
|
Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
|
•
|
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and
|
•
|
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.
|
•
|
We did not always ensure that the four basic elements of revenue recognition were achieved prior to revenue recognition and all elements within multiple element arrangements were identified and accounted for appropriately.
|
•
|
We did not maintain adequate oversight that guided individuals in applying internal control over financial reporting in preventing or detecting material accounting errors, or omissions, due to inadequate information and, in certain instances, compliance with the Company’s revenue recognition policies.
|
•
|
We did not always ensure that relevant information was timely communicated within our organization, to our independent directors, the Audit Committee, and our independent auditors.
|
•
|
We did not generate and provide quality information and communication based on the criteria established in the COSO framework, and have identified control deficiencies in the principles associated with the information and communication component of the COSO framework that constitute material weaknesses, either individually or in the aggregate, relating to: (i) obtaining, generating, and using relevant quality information to support the function of internal control, and (ii) communicating accurate information internally and externally, including providing information pursuant to objectives, responsibilities and functions of internal control.
|
•
|
We did not design and maintain adequate review and approval controls, including the use of appropriate technical accounting expertise, when recording complex or non-routine transactions such as those involving revenue recognition, acquisitions and divestitures, and asset impairment, including ensuring transactions are appropriately accounted for from a substance over form perspective.
|
•
|
We did not maintain sufficient personnel with an appropriate level of accounting knowledge, experience, and training in the application of US GAAP commensurate with the size of the entity and nature and complexity of financial reporting requirements.
|
•
|
We did not design and maintain effective review and approval controls over the period-end reporting process, including maintaining sufficient formal, written policies and procedures governing the financial statement close process.
|
•
|
We did not maintain adequate polices procedures and documentation to support an effective IT general control environment. Our management identified control deficiencies in the operating effectiveness of information technology general controls (“ITGC”s) related to information technology (“IT”) application systems, databases and operating systems throughout the organization that are used for financial reporting purposes. Specifically, we did not establish effective program change and user access controls which restricted user access to IT applications consistent with their assigned authorities and responsibilities. Consequently, automated processes and controls over financial reporting which are dependent upon effective ITGCs, and manual controls which are dependent upon the completeness and accuracy of the information generated from the IT systems, were ineffective.
|
•
|
We did not maintain an Internal audit group to provide oversight which limited our ability to effectively monitor internal controls.
|
•
|
We did not consistently maintain a corporate culture that prevented the occurrence of certain deviations from Company policy.
|
•
|
CEO Communications to Reinforce Compliance
- The Company’s Chief Executive Officer, at the direction of the Company’s Board of Directors, has reinforced the importance of adherence to the Company’s policies and procedures regarding ethics and compliance and the importance of identifying misconduct and raising and communicating concerns. This reinforcement has occurred through email and employee newsletter communications, staff meetings, remarks given to senior management during strategic planning sessions, as well as other employee forums. The Company’s Chief Executive Officer has also expressed to the Company’s Board of Directors his commitment to an enhanced control environment.
|
•
|
Organizational Enhancements
- The Company has identified and begun to implement several organizational enhancements, as follows: (i) the creation of a new position, Director of Revenue Recognition, which has been filled and will be responsible for all aspects of the Company's revenue recognition policies, procedures and the proper application of accounting to the Company’s sales arrangements; (ii) the identification and hiring of a Director of Technical Accounting, who will have the responsibility and authority to ensure that U.S. GAAP and accounting for complex or non-routine transactions that require specialized accounting are appropriately applied corporate-wide; (iii) the establishment of an Internal Audit function that will report directly to the Audit Committee; (iv) the enhancement of the Company’s organizational structure over all finance functions and an increase in the Company’s accounting personnel with the requisite knowledge, experience, and training in U.S. GAAP to ensure that a formalized process for determining, documenting, communicating, implementing and monitoring controls over the period-end financial close and reporting processes is maintained.
|
•
|
Revenue Practices
- The Company has evaluated its revenue practices and has begun implementing improvements in those practices, including: (i) the development of more comprehensive revenue recognition policies and improved procedures to ensure that such policies are understood and consistently applied; (ii) better communication among all functions involved in the sales process (e.g., sales, business unit, legal, accounting, finance, business development); (iii) increased standardization of contract documentation and revenue analyses for individual transactions, including increased oversight of revenue opportunities and contract review by personnel with the requisite accounting knowledge to identify revenue-impacting terms and consider potential downstream effects; and (iv) the development of a more comprehensive review process and monitoring controls over contracts with customers to ensure accurate accounting for multiple-element arrangements and the preparation of accounting memoranda.
|
•
|
Significant Transactions
- The Company has evaluated its practices related to significant non-recurring transactions and has begun implementing improvements in those practices, including: (i) better communication among all functions involved in the execution of and accounting for such transactions (e.g., business development, legal, accounting, finance, sales), including regular touch points; (ii) more formalized practices for assessing the internal knowledge, experience and bandwidth to account for significant non-recurring transactions internally versus the need to engage an external third-party; and (iii) the development of a more comprehensive review process and monitoring controls over significant transactions (e.g.,
|
•
|
Control Design Remediation
- The Company has performed a review of key business process controls related to high-risk financial statement accounts, such as revenue, significant transactions, capitalized software, accounts receivable, treasury and financial close, which resulted in the redesign of existing controls and the addition of newly developed / documented control activities, in order to mitigate known risks and strengthen the overall control environment. Documentation supporting each process identifies existing control design gaps and recommendations for remediation. The Company intends to perform a similar review of additional business process and information technology controls related to processes such as entity level controls, fixed assets, procure-to-pay, payroll, equity, and cash receipts.
|
•
|
Accounting and Compliance Training
- The Company has initiated development of a comprehensive revenue recognition and contract review training program that has been focused on the impacts of adopting ASC 606, Revenue from Contracts with Customers. This training is focused on senior-level management and customer-facing employees, as well as finance, sales and marketing personnel.
|
•
|
Training Practices
- The Company has initiated enhancements to its internal controls by providing additional and ongoing training to employees with customer facing responsibilities regarding international sales and accounting practices, the Foreign Corrupt Practices Act, Code of Conduct and acceptable structures of international sales contracts.
|
•
|
Implementation and Enhancement of Business Process and IT Controls
- The Company intends to implement effective control activities that contribute to the mitigation of risks and establish procedures that put policies into action. This will include redesigned existing controls and newly developed or documented controls, resulting from the Company’s control design remediation efforts described above. Control activities will be performed and reviewed to remediate prior SOX testing deficiencies, such as failures related to IT change management procedures, user access management controls, and management review controls.
|
•
|
Implementation and Enhancement of Entity Level Controls
- The Company intends to enhance existing entity level controls as a result of the control design remediation efforts and Audit Committee recommendations, and implement the following new entity level controls around the quarterly/annual financial reporting process:
|
–
|
Sub-certification Process: Key process owners each quarter (as part of the Form 10-Q and 10-K preparation) will complete a sub-certification questionnaire and checklist to support how the process owner reached the conclusion that controls are operating effectively in their respective areas and provide an opportunity to highlight any concerns they have related to internal control over financial reporting. In addition, this will require the process owner to indicate any changes in processes, controls or key personnel during the period.
|
–
|
Disclosure Committee Certification Process: A formal certification process by the members of the disclosure committee will occur focused on full disclosure of information requiring disclosure to the CEO and CFO, disclosure of any and all control deficiencies or material weaknesses, any knowledge of or instances of fraud, and any other known violations to laws, regulations or Company policies.
|
•
|
Establishment of Disclosure Committee
- A formal disclosure committee will be established that includes key members of management that have responsibility for disclosure information necessary for periodic reports filed with the SEC. This committee will meet on an as-needed basis as well as prior to the Audit Committee meeting in which the Form 10-K, Form 10-Q or other relevant Exchange Act document will be approved and will conduct follow-up meetings as necessary. The meeting will cover all significant events from the period being reported upon and supporting information. A charter will be developed governing the conduct of this committee and a formal agenda will be distributed prior to each meeting and minutes will be maintained and published for each meeting.
|
•
|
Non-recurring transaction reviews
- A recurring “NRT” review meeting cadence will be established for key stakeholders within the Company to identify and discuss potentially significant transactions. Meetings will be attended by process owners
|
•
|
Finance Considerations
- The Company intends to implement new controls and business practices identified during the control design remediation to enhance communication between finance and other internal groups and ensure information is obtained and applied timely, including:
|
–
|
Increased communication between finance and all functions involved in sales, specific to the satisfaction of performance obligations and ultimate recognition of revenue, as well as the termination, modification, or combination of revenue arrangements.
|
–
|
Increased communication between finance and all functions involved in the identification, evaluation and execution of significant transactions, especially when such transactions include a sales element.
|
–
|
Increased communication between finance and all functions involved in the tracking of capitalized software development costs, to (i) ensure development time is tracked at the appropriate level of precision to match the asset being capitalized, and (ii) confirm the status of features being developed, which drives the recognition of amortization and/or impairment.
|
•
|
Information Technology
- Based on the results of the control design remediation, the Company intends to design, implement, and review Information Technology General Controls (“ITGCs”) to ensure effectively operating user access management and change management procedures. These controls will mitigate the risk of inappropriate or unrestricted access to Company information, applications and systems.
|
•
|
Internal Audit Function Assessment
- The Company intends to establish a formal Internal Audit function. This function will be responsible for performing the following tasks on a go-forward basis:
|
–
|
Performing a formalized risk assessment to identify relevant accounts and assertions, and design control procedures that relate to the relevant risks.
|
–
|
Revising the process and internal controls for accurate recording, presentation and disclosure of revenue, and review and approval of complex and non-routine transactions including treatment of goodwill, and capitalization of internally developed software, to require the involvement of appropriately qualified accountants from the corporate Technical Accounting group.
|
–
|
Assessing the effectiveness of entity level controls and any enhancements required to strengthen the control environment, such as changes to the whistleblower hotline.
|
–
|
Conducting ongoing evaluations of key business processes and ITGCs.
|
–
|
Evaluating and communicating deficiencies related to business processes or ITGCs and monitoring the appropriate corrective action, to maintain an effective control environment.
|
Name
|
Age
|
Current Positions
|
Stephen G. Waldis
|
51
|
Executive Chairman and Founder
|
Glenn Lurie
|
52
|
President, Chief Executive Officer and Director
|
Lawrence Irving
|
61
|
Chief Financial Officer and Treasurer
|
Robert E. Garcia
|
49
|
Chief Commercial Officer
|
Mary Clark
|
52
|
Chief Marketing Officer and Executive Vice President, Products
|
Ronald J. Prague
|
55
|
Chief Legal Officer and Secretary
|
Patrick J. Doran
|
45
|
Chief Technology Officer
|
Kevin Hunsaker
|
53
|
Chief People Officer
|
Christopher Putnam *
|
48
|
President and General Manager, Americas
|
Daniel Rizer **
|
54
|
Chief Strategy Officer
|
Name
|
Age
|
Position
|
Class
|
Term Expiration Year
|
Stephen G. Waldis
|
51
|
Executive Chairman of the Board
|
Class III
|
2018
|
Glenn Lurie
|
52
|
President, Chief Executive Officer and Director
|
Class III
|
2018
|
William J. Cadogan
|
69
|
Director
|
Class III
|
2018
|
Thomas J. Hopkins
|
61
|
Director
|
Class II
|
2020
|
James M. McCormick
|
58
|
Director
|
Class I
|
2019
|
Donnie M. Moore
|
69
|
Director
|
Class I
|
2019
|
Frank Baker
|
44
|
Director
|
(a)
|
(a)
|
Peter Berger
|
67
|
Director
|
(a)
|
(a)
|
Robert Aquilina
|
67
|
Director
|
Class II
|
2020
|
(a)
|
Messrs. Baker and Berger (together, the “Series A Directors”) were appointed to the Board on February 15, 2018 in connection with the sale of the Company’s Series A Convertible Participating Perpetual Preferred Stock (the “Series A Preferred Stock”) pursuant to the Company’s Certificate of Designations (the “Series A Certificate”). Pursuant to Section 8(b) of the Series A Certificate, the Series A Preferred Directors are not subject to the classified board of directors provisions of Article VI of the Company’s Restated Certificate of Incorporation and accordingly are not classified into Class I, Class II or Class III and their term only expires pursuant to the terms of the Series A Certificate.
|
•
|
overseeing the conduct, assessment and other operational risks to evaluate whether our business is being properly managed;
|
•
|
reviewing and approving our strategic, financial and operating plans and other significant actions;
|
•
|
evaluating the performance of and reviewing and determining the compensation of our CEO and other executive officers;
|
•
|
planning for succession for our CEO and monitoring management’s succession planning for other executive officers; and
|
•
|
overseeing the processes for maintaining the integrity of our financial statements, public disclosures, and compliance with laws and ethics.
|
Name*
|
Audit Committee
|
Compensation Committee
|
Nominating/Corporate Governance Committee
|
Business Development Committee
|
Stephen G. Waldis
|
-
|
-
|
-
|
M
|
Glenn Lurie
|
-
|
-
|
-
|
M
|
William J. Cadogan
|
M
|
C
|
M
|
M
|
Thomas J. Hopkins
|
M
|
M
|
-
|
C
|
James M. McCormick
|
-
|
M
|
C
|
-
|
Donnie M. Moore
|
C
|
-
|
M
|
-
|
Total meetings in year 2017
|
39
|
13
|
1
|
0
|
*
|
Messrs. Baker and Berger are excluded from this table as they joined the Board in February 2018. Mr. Baker is a member of our Nominating/Corporate Governance Committee and Business Development Committee. Mr. Berger is a member of our Compensation Committee and Nominating/Corporate Governance Committee. Mr. Berger also attends meetings of our Audit Committee as an observer. Mr. Aquilina is also excluded from this table as he joined the Board in April 2018.
|
•
|
reviews our annual audited and quarterly financial statements and SEC reporting;
|
•
|
reviews management’s assessment of risk pertaining to our reporting and disclosure controls and monitors our internal controls and audit functions, the results and scope of the annual audit and other services provided by our independent registered public accounting firm and our compliance with legal matters that have a significant impact on our financial statements;
|
•
|
establishes procedures for the receipt and treatment of complaints regarding internal accounting controls or auditing matters and the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters;
|
•
|
appoints, compensates, reviews procedures to ensure the independence of and oversees the work of, our independent registered public accounting firm, including approving services and fee arrangements;
|
•
|
approves all related transactions;
|
•
|
reviews with senior members of our management our policies and practices regarding risk assessment and risk management;
|
•
|
reviews periodically the adequacy and effectiveness of our internal and disclosure controls, including our policies regarding compliance with legal, regulatory, code of conduct, ethical and internal auditing standards;
|
•
|
reviews earnings press releases prior to issuance; and
|
•
|
reviews findings and recommendations of our independent registered public accounting firm and management’s response to their recommendations.
|
•
|
review and approve our compensation strategy and philosophy;
|
•
|
review and approve our annual corporate goals and objectives related to executive compensation and evaluate performance in light of these goals;
|
•
|
review and approve policies and all forms of compensation and other benefits to be provided to our employees (including our NEOs), including among other things the annual base salaries, bonus, stock options, restricted stock grants and other incentive compensation arrangements;
|
•
|
evaluate our CEO’s performance and determine his salary and incentive compensation;
|
•
|
in consultation with our CEO, determine the salaries and incentive compensation of our other executive officers;
|
•
|
make recommendations from time to time to our Board regarding non-employee director compensation matters;
|
•
|
recommend, for approval by the Board, the adoption or amendment of our equity and cash incentive plans;
|
•
|
administer our stock purchase plan and equity incentive plans;
|
•
|
oversee the administration of our other material employee benefit plans, including our 401(k) plan; and
|
•
|
review and approve other aspects of our compensation policies and matters as they arise from time to time.
|
•
|
reviews and reports to our Board on a periodic basis with regard to matters of corporate governance;
|
•
|
recommends qualified candidates to our Board for election as our directors, including the directors our Board proposes for election by the stockholders at the Annual Meeting and directors nominated by our stockholders;
|
•
|
reviews, assesses and makes recommendations on the effectiveness of our corporate governance policies and on matters relating to the practices of directors and the functions and duties of the various Board committees;
|
•
|
develops and implements our Board’s biennial self-assessment process and works with our Board to implement improvements in their effectiveness;
|
•
|
reviews succession plans periodically with our CEO relating to positions held by elected corporate officers;
|
•
|
reviews and makes recommendations to our Board regarding the size and composition of our Board and the appropriate qualities and skills required of our directors in the context of the then current make-up of our Board and our business; and
|
•
|
establishes and periodically reviews stock ownership guidelines for our executive officers and directors.
|
Compensable Position / Event
|
Compensation
|
Initial Equity Grant
|
Non-qualified stock option to purchase 30,000 shares
(1)
|
Annual Cash Retainer
|
$50,000
|
Annual Equity Grant
|
Equity awards with an aggregate grant date fair value of $200,000
60% in restricted shares
(1)
40% in the form of a non-qualified stock option
(1)
|
Committee Chairperson Retainer
|
$20,000 (Audit)
$15,000 (Compensation)
$10,000 (Nominating/Corporate Governance)
$10,000 (Business Development)
|
Committee Member Retainer
|
$10,000 (Audit)
$7,500 (Compensation)
$5,000 (Nominating/Corporate Governance)
$5,000 (Business Development)
|
Name*
|
Fees Earned or
Paid in Cash
($)
|
Stock Awards
($)
(1)
|
Option Awards
($)
(2)
|
Total
($)
|
|
William J. Cadogan
|
85,000
|
119,998
|
80,004
|
285,002
|
|
Thomas Hopkins
|
77,500
|
119,998
|
80,004
|
277,502
|
|
James McCormick
|
64,610
|
119,998
|
80,004
|
264,612
|
|
Donnie M. Moore
|
75,000
|
119,998
|
80,004
|
275,002
|
(1)
|
The amounts in this column reflect the aggregate grant date fair value of the stock awards computed in accordance with FASB ASC Topic No. 718. See Footnote 3 to the financial statements included in this Form 10-K for a discussion of our assumptions in estimating the fair value of our stock awards.
|
(2)
|
The amounts in this column reflect the aggregate grant date fair value of the stock options computed in accordance with FASB ASC Topic No. 718. See Footnote 3 to the financial statements included in this Form 10-K.
|
*
|
Messrs. Baker and Berger are excluded from this table as they joined the Board in February 2018. Mr. Aquilina is also excluded from this table as he joined the Board in April 2018.
|
•
|
for any breach of a director’s duty in respect of unlawful (i) payments of dividends or (ii) stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law and the breach of a director’s duty of loyalty to us or our stockholders;
|
•
|
for any transaction from which the director derives any improper personal benefit; and
|
•
|
for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law.
|
Financial Restatement, Recoupment and Related Policies
|
As part of our Code of Business Conduct, we will investigate all reported instances of questionable or unethical behavior of a director, NEO or other employee and, where improper behavior or failure to act is found to have occurred, will take appropriate action up to and including termination. If an investigation uncovers that an individual has committed fraud or other improper acts that causes our financial statements to be restated or otherwise affected, our Board has discretion to take immediate and appropriate disciplinary action with respect to that individual up to and including termination. Our Board also has discretion to pursue whatever legal remedies are available to prosecute that individual to the fullest extent of the law and may seek to recoup or recover any amounts he or she inappropriately received as a result of his or her improper actions, including but not limited to any annual or long term incentives that he or she received to the extent the individual would not have received that amount had the improper action not been taken.
|
Named Executive Officer
|
Title as of December 31, 2017
|
|
Glenn Lurie
(1)
|
Chief Executive Officer
|
|
Stephen Waldis
(1)
|
Executive Chairman, Former Chief Executive Officer & Founder
|
|
Ronald Hovsepian
(1)
|
Former Chief Executive Officer
|
|
Lawrence Irving
(2)
|
Chief Financial Officer
|
|
John Frederick
(2)
|
Former Chief Financial Officer
|
|
Karen Rosenberger
(2)
|
Former Chief Financial Officer
|
|
Robert E. Garcia
|
Chief Commercial Officer
|
|
Christopher S. Putnam
(3)
|
President and General Manager, Americas
|
|
Daniel Rizer
(4)
|
Chief Strategy Officer
|
(1)
|
On December 5, 2016, we entered into an Agreement and Plan of Merger that provided for our acquisition of all of the outstanding shares of common stock of Intralinks through a tender offer (the “Intralinks Transaction”). On January 19, 2017, we acquired all of the outstanding shares of common stock of Intralinks Holdings Inc. (the “Intralinks Transaction”) and Intralinks became a wholly owned subsidiary of our Company. Upon the closing of the Intralinks Transaction, we appointed Ronald W. Hovsepian as Synchronoss’ Chief Executive Officer and a member of our Board. In addition, on January 19, 2017, Stephen G. Waldis resigned from his position as Chief Executive Officer of our Company and was appointed our Executive Chairman of the Board. Mr. Hovsepian resigned as our Chief Executive Officer on April 27, 2017, Mr. Waldis was again appointed as our Chief Executive Officer until November 13, 2107 when he stepped down and Mr. Lurie was appointed as our Chief Executive Officer and Mr. Waldis was appointed our Executive Chairman as of the same date.
|
(2)
|
Ms. Rosenberger resigned as Chief Financial Officer effective February 27, 2017. Ms. Rosenberger remained employed with us through April 1, 2017. Mr. Frederick served as our Chief Financial Officer from February 27, 2017 until he resigned on April 27, 2017 at which time Mr. Irving was appointed as our Chief Financial Officer.
|
(3)
|
Mr. Putnam resigned as President and General Manager, Americas, effective June 30, 2018.
|
(4)
|
Mr. Rizer resigned as Chief Strategy Officer, effective as of March 31, 2018, and is no longer employed by our Company.
|
Pay for Performance
|
Provide a strong relationship of pay to performance through:
• Performance-based cash bonus tied primarily to achievement of corporate short-term financial goals and individual performance.
• Equity awards that derive value based on the performance of our Common Stock and, in the case of performance-based stock awards, the achievement of pre-determined, objective financial and business goals.
|
Emphasis on Variable Compensation
|
• Total compensation is heavily weighted toward incentive compensation (i.e., annual cash bonuses and long-term equity incentives).
• Annual performance-based cash bonuses focus our NEOs on key short-term financial goals.
• Stock options and time-based and performance-based restricted shares incentivize our NEOs to focus on sustainable, long-term stockholder value creation. The value realized by our NEOs depends substantially on our long-term performance, achievement of our strategic goals and the value of our Common Stock, which we believe aligns our NEOs’ interests with the long-term interests of our stockholders.
|
Fixed Compensation Component
|
• Provide base salary based on our Compensation Committee’s general understanding of current competitive compensation practices, the role in which a NEO serves and the NEO’s responsibilities, length of tenure, internal pay equity and individual performance.
|
At-Risk Compensation
|
A majority of the compensation of our Chief Executive Officer and our other NEOs is “at-risk” and tied to Company performance over the short- and/or long-term.
|
Incentive Award Metrics
|
Establish and approve challenging performance metrics for incentive plans tied to key Company performance indicators.
|
Performance Equity Plan
|
The number of performance-based restricted shares earned is based on our financial performance over a specified period, aligning our NEOs’ interests with the long-term interests of our stockholders.
|
Time-Based Equity Vesting
|
Equity awards subject to time-based vesting vest incrementally over three or four years to promote retention.
|
Stock Ownership Guidelines
|
Maintain stock ownership guidelines to support the alignment of interests between our NEOs and stockholders.
|
No Hedging
|
Prohibition of hedging exposure of, or interest in, our Common Stock.
|
*
|
These financial measures are non-GAAP measures and should not be reviewed in isolation or as substitutes for our financial results as reported in accordance with GAAP. As there was no payment, we have not included a reconciliation of these non-GAAP financial measures to the applicable GAAP financial measures.
|
•
|
60% are earned based on the non-GAAP revenue* of our Company in 2015 and 2016;
|
•
|
30% are earned based on the non-GAAP EBITDA as a percentage of non-GAAP revenue* of our Company in 2015 and 2016; and
|
•
|
10% are earned based on the revenue of our Cloud business in 2015 and 2016.
|
*
|
These financial measures are non-GAAP measures and should not be reviewed in isolation or as substitutes for our financial results as reported in accordance with GAAP. Please see Appendix A for an explanation and reconciliation of these non-GAAP financial measures to the applicable GAAP financial measures.
|
•
|
60% are earned based on the non-GAAP revenue* of our Company in 2016;
|
•
|
30% are earned based on the non-GAAP EBITDA as a percentage of non-GAAP revenue* of our Company in 2016; and
|
•
|
10% are earned based on the Enterprise Business Unit non-GAAP revenue*.
|
•
|
40% are earned based on the non-GAAP revenue* of our Company in 2017 and 2018;
|
•
|
40% are earned based on the non-GAAP EBITDA as a percentage of non-GAAP revenue* of our Company in 2017 and 2018; and
|
•
|
20% are earned based on the recurring revenue in 2017, and provided that the Committee had discretion to determine an appropriate 2018 metric.
|
*
|
These financial measures are non-GAAP measures and should not be reviewed in isolation or as substitutes for our financial results as reported in accordance with GAAP. Please see Appendix A for an explanation and reconciliation of these non-GAAP financial measures to the applicable GAAP financial measures.
|
•
|
40% are earned based on non-GAAP revenue* of our Company for the year ended December 31, 2017;
|
•
|
40% are earned based on non-GAAP EBITDA* for the year ended December 31, 2017; and
|
•
|
20% are based on recurring revenue for the year ended December 31, 2017 (provided that if the non-GAAP revenue metric was not met, executives would not be eligible for any shares solely based on the recurring revenue metric).
|
*
|
These financial measures are non-GAAP measures and should not be reviewed in isolation or as substitutes for our financial results as reported in accordance with GAAP. Please see Appendix A for an explanation and reconciliation of these non-GAAP financial measures to the applicable GAAP financial measures.
|
BroadSoft, Inc.
|
Guidewire Software Inc.
|
NeuStar, Inc.
|
Blackbaud, Inc.
|
Interactive Intelligence Group, Inc.
|
Pegasystems, Inc.
|
Bottomline Technologies Inc.
|
J2 Global, Inc.
|
Progress Software Corp.
|
CommVault Systems, Inc.
|
LogMeIn, Inc.
|
Proofpoint, Inc.
|
Cornerstone OnDemand Inc.
|
Medidata Solutions, Inc.
|
Infoblox, Inc.
|
Fleetmatics Group PLC
|
MicroStrategy, Inc.
|
The Ultimate Software Group
|
Base Salary
|
Objective:
|
|||
|
Our Compensation Committee sets base salaries with the intent to attract and retain executives, reward satisfactory performance and provide a minimum, fixed level of cash compensation to compensate NEOs for their day-to-day responsibilities.
|
|||
|
Key Features:
|
|||
|
•
|
|
Executive base salaries are initially determined as a result of negotiation between the executive and our management in consultation with, and subject to the approval of, our Compensation Committee.
|
|
|
•
|
|
Our Compensation Committee reviews base salaries annually and has discretion to provide increases based on its understanding of current competitive pay practices, promotions, our Chief Executive Officer’s recommendation (except in the case of his own salary), changes in responsibilities and performance, annual budget for increases, our overall financial and operational results, the general economy, length of tenure and internal pay equity and other factors our Compensation Committee deems appropriate.
|
|
|
Process:
|
|||
|
•
|
|
At the end of each calendar year, our Chief Executive Officer recommends base salaries for executives other than himself for the following calendar year.
|
|
|
•
|
|
Our Compensation Committee reviews proposed base salary changes and competitive market data with input from its compensation consultant.
|
|
|
•
|
|
Our Compensation Committee approves base salaries for our NEOs.
|
|
|
•
|
|
Our Compensation Committee reports base salary determinations to our full Board.
|
|
|
|
|
|
|
Annual Cash
|
Objective:
|
|||
Incentive Bonus
|
Annual cash incentive bonuses are awarded under a performance-based compensation program and are designed to align the interests of our NEOs and stockholders by providing compensation based on the achievement of pre-determined corporate and/or business goals and individual performance.
|
|||
|
Key Features:
|
|||
|
•
|
|
Each year, the target bonus for each NEO is set by our Compensation Committee based on the provisions of each NEO’s employment agreement or executive plan, our Chief Executive Officer’s recommendation (except in the case of his own target), internal pay equity, our Compensation Committee’s general understanding of current competitive pay practices and other factors it deems appropriate.
|
|
|
•
|
|
At least 90% of the incentive compensation for our NEOs other than Mr. Putnam is based on achievement of certain objective corporate financial goals established and approved by our Compensation Committee at the start of the year. Because Mr. Putnam is responsible for our worldwide sales, our Compensation Committee determined that 40% of his cash incentive bonus would be determined based on the Company metrics, with the remaining 60% of his cash incentive determined based on business unit performance.
|
|
|
•
|
|
If we achieve results that are below certain threshold levels, these NEOs receive no cash incentive bonus, while results that are above certain threshold levels result in cash incentive bonuses above target levels.
|
|
|
Process:
|
|||
|
•
|
|
Our Compensation Committee participates in our Board’s review of our annual operating plan at the beginning of the year.
|
|
|
•
|
|
Our Chief Executive Officer recommends bonus targets as a percentage of base salary for each NEO other than himself.
|
|
|
•
|
|
Our management recommends financial and other performance measures, weightings and ranges.
|
|
|
•
|
|
Our Compensation Committee reviews proposed bonus targets, performance measures and ranges provided by management and competitive market data, with input from its compensation consultant, approves bonus targets, performance measures and ranges that it believes establish appropriately challenging goals.
|
|
|
•
|
|
After the end of the fiscal year, our management presents the Company’s financial results to our Board.
|
|
•
|
|
Our Chief Executive Officer recommends the individual component award for each of our NEOs other than himself.
|
|
|
•
|
|
Our Compensation Committee reviews the results and determines whether to make any adjustments to the recommendations and then approves each NEO’s bonus award.
|
|
|
•
|
|
Our Compensation Committee reports bonus award determinations to our full Board.
|
|
|
|
|
|
|
Equity Awards
|
Objectives:
|
|||
|
Our Compensation Committee structures equity awards to align our NEOs’ interests with those of our stockholders, support retention and motivate NEOs to achieve our financial, strategic and operational goals. Equity awards include stock options and time-based and performance-based restricted shares.
|
|||
|
Key Features:
|
|||
|
•
|
|
Our Compensation Committee grants stock options and time-based and performance-based restricted shares to our NEOs with a grant date fair value determined based on our Compensation Committee’s general understanding of current competitive pay practices, our CEO’s recommendation (except in the case of his own awards), recommendations from our compensation consultant, internal pay equity, evaluation of each NEO’s performance, and other factors our Compensation Committee deems appropriate.
|
|
|
•
|
|
Long-term incentive awards are allocated, based on grant date fair value, as follows (with vesting terms that generally extend up to four years):
|
|
|
|
|
o One-third stock options
|
|
|
|
|
o One-third time-based restricted shares
|
|
|
|
|
o One-third performance-based restricted shares
|
|
|
•
|
|
Our Compensation Committee believes this mix provides NEOs with a balanced retention and performance opportunity and serves to closely align our NEOs’ long-term objectives with those of our stockholders.
|
|
|
•
|
|
Each performance-based restricted share award has a target number of shares to be earned typically following completion of a three-year performance period based on the achievement of certain pre-established Company performance criteria. The performance-based restricted shares are earned and vest based on continued service for the applicable period if the relevant performance criteria are achieved.
|
|
|
Process:
|
|||
|
•
|
|
In the first fiscal quarter, our Chief Executive Officer recommends grant date fair values of awards for executives other than himself.
|
|
|
•
|
|
Our Compensation Committee reviews proposed performance measures and ranges provided by management and competitive market data and, with input from its compensation consultant approves performance measures and ranges that it believes establish appropriately challenging goals.
|
|
|
•
|
|
Our Compensation Committee approves the number of time-based shares underlying stock options and the target number of time-based and performance-based restricted shares granted to our NEOs.
|
|
|
•
|
|
Our Compensation Committee reports equity award determinations to our full Board.
|
|
|
•
|
|
Our Compensation Committee reviews the financial performance of our Company for the relevant performance period and determines the amount of earned shares.
|
|
|
|
|
|
|
Severance and Change in Control Benefits
|
Objectives:
|
|||
|
|
Severance and change in control benefits are included in each NEO’s employment agreement in order to promote stability and continuity of our senior management team in the event of a potential change in control and/or an involuntary termination. Our Compensation Committee believes these provisions help to align our NEOs’ interests appropriately with those of our stockholders in these scenarios.
|
||
|
Key Features:
|
|||
|
•
|
|
Events triggering payment require a termination of our NEOs’ employment by our Company without cause or by the executive for good reason. Executives are entitled to enhanced benefits if the qualifying termination occurs during a specified period following a change in control (i.e., double-trigger).
|
|
|
•
|
|
Change in Control benefits do not include excise tax gross-ups.
|
|
•
|
|
Our Compensation Committee has determined these termination-related benefits are appropriate to preserve productivity and encourage retention in the face of potentially disruptive circumstances. These agreements also include restrictive covenants that help protect our Company from competition and solicitation of employees and customers.
|
|
|
•
|
|
Each NEO will only be eligible to receive severance payments if he or she signs a general release of claims following an eligible termination.
|
|
2016
|
2017
|
Name
|
Base Salary
|
Base Salary
|
Glenn Lurie
(1)
|
N/A
|
$750,000
|
Stephen G. Waldis
(2)
|
$608,900
|
$625,000
|
Lawrence Irving
(3)
|
N/A
|
$425,000
|
Robert E. Garcia
(4)
|
$450,000
|
$475,000
|
Christopher S. Putnam
|
$340,000
|
$340,000
|
Daniel Rizer
|
$420,000
|
$420,000
|
(1)
|
Mr. Lurie became our Chief Executive Officer on November 13, 2017 and was not employed with us in 2016.
|
(2)
|
Mr. Waldis resigned as our Chief Executive Officer effective as of January 19, 2017 and was appointed Executive Chairman on such date and his base salary was reduced to $500,000, effective March 1, 2017. Upon Mr. Hovsepian’s resignation as our Chief Executive Officer on April 27, 2017, Mr. Waldis was again appointed as our Chief Executive Officer and his base salary was increased to $625,000. On November 13, 2017, Mr. Waldis stepped down as Chief Executive Officer, and again was appointed Executive Chairman, and his base salary was reduced to $300,000, effective January 1, 2018, and Mr. Lurie was appointed as our Chief Executive Officer as of the same date. Messrs. Lurie and Hovsepian were not employed with us in 2016.
|
(3)
|
Ms. Rosenberger resigned as our Chief Financial Officer effective February 27, 2017. Ms. Rosenberger remained employed with us through April 1, 2017. Mr. Frederick served as our Chief Financial Officer from February 27, 2017 until he resigned on April 27, 2017, at which time Mr. Irving was appointed as our Chief Financial Officer. Mr. Irving was appointed as our Chief Financial Officer on April 27, 2017. Messrs. Frederick and Irving were not employed with us in 2016.
|
(4)
|
In 2017, Mr. Garcia received an approximate 5.5% increase in his base salary to keep him at the approximate 50
th
percentile of individuals at our peer group companies in similar positions.
|
Name
|
Number of Time-Based
Shares of Restricted Stock
|
Number of Shares
Subject to Options
|
Number of Shares Subject to
Performance Vesting Restricted Stock
|
Stephen G. Waldis
|
56,914
|
163,764
|
56,914
|
Lawrence Irving
|
47,654
|
140,161
|
47,654
|
Robert E. Garcia
|
32,125
|
91,787
|
32,125
|
Christopher S. Putnam
|
30,618
|
87,481
|
30,618
|
Daniel Rizer
|
20,412
|
58,320
|
20,412
|
Name
|
Threshold
|
Target
|
Maximum
|
Stephen G. Waldis
|
12,951
|
25,901
|
51,802
|
Robert E. Garcia
|
8,489
|
16,978
|
33,956
|
Christopher S. Putnam
|
535
|
1,069
|
2,138
|
Daniel Rizer
|
1,918
|
3,386
|
7,762
|
Corporate Component
|
Threshold
50% payout
|
Target
100% payout
|
Maximum
200% payout
|
Weighting
|
Non-GAAP Revenue*
|
$607,000,000
|
$661,000,000
|
$718,000,000
|
60%
|
Non-GAAP EBITDA as % of Revenue*
|
25%
|
35%
|
45%
|
30%
|
Non-GAAP Cloud Revenue*
|
$319,000,000
|
$359,000,000
|
$402,000,000
|
10%
|
*
|
This financial measure is a non-GAAP measures and should not be reviewed in isolation or as substitutes for our financial results as reported in accordance with GAAP. Please see Appendix A for an explanation and reconciliation of these non-GAAP financial measures to the applicable GAAP financial measures.
|
•
|
our Adjusted Non-GAAP revenue was $698.4 million, which was above the target attainment, resulting in a 108% payout with respect to this component;
|
•
|
our 2016 Adjusted Non-GAAP EBITDA was $237.2 million, or 34% of revenue, which was slightly below the target attainment, resulting in a 95% payout with respect to this component; and
|
•
|
our 2016 non-GAAP Cloud revenue was $403.4 million, which was significantly above the maximum, resulting in a 200% payout with respect to this component.
|
Corporate Component
|
Achievement
|
Plan Payout
|
Weighting
|
Adjusted Non-GAAP Revenue*
|
$698,400,000
|
165%
|
60%
|
Adjusted Non-GAAP EBITDA*
|
34%
|
95%
|
30%
|
Non-GAAP Cloud Revenue*
|
$403,381,000
|
200%
|
10%
|
Name
|
Threshold
|
Target
|
Maximum
|
Stephen G. Waldis
|
26,476
|
52,951
|
105,902
|
Robert E. Garcia
|
16,144
|
32,287
|
64,574
|
Christopher S. Putnam
|
4,972
|
9,944
|
19,888
|
Daniel Rizer
|
3,487
|
6,974
|
13,948
|
Corporate Component
|
Threshold
50% payout
|
Target
100% payout
|
Maximum
200% payout
|
Weighting
|
Non-GAAP Revenue*
|
$667,000,000
|
$696,000,000
|
$725,000,000
|
60%
|
Non-GAAP EBITDA as % of Revenue*
|
25%
|
35%
|
45%
|
30%
|
Enterprise Business Revenue* (% of total revenue)
|
N/A
|
15%
|
N/A
|
10%
|
•
|
our Adjusted Non-GAAP revenue was $698.4 million, which was above the target attainment, resulting in a 108% payout with respect to this component;
|
•
|
our 2016 Adjusted Non-GAAP EBITDA was $237.2 million, or 34% of revenue, which was slightly below the target attainment, resulting in a 95% payout with respect to this component; and
|
•
|
our 2016 non-GAAP Enterprise Business revenue was 3% of total revenue, which was significantly below the target payout, resulting in a 0% payout with respect to this component.
|
Corporate Component
|
Achievement
|
Plan Payout
|
Weighting
|
Adjusted Non-GAAP Revenue*
|
$698,400,000
|
165%
|
60%
|
Adjusted Non-GAAP EBITDA*
|
34%
|
95%
|
30%
|
Enterprise Business Revenue* (% of total revenue)
|
3%
|
—%
|
10%
|
Name
|
2016 - 2018 Target Shares
|
2016 Target Shares
|
Attainment %
|
Shares Earned
|
Stephen G. Waldis
|
52,951
|
17,650
|
93.3%
|
16,467
|
Robert E. Garcia
|
32,287
|
10,762
|
93.3%
|
10,040
|
Daniel Rizer
|
6,974
|
2,325
|
93.3%
|
2,169
|
Christopher Putnam
|
9,944
|
3,647
|
93.3%
|
3,402
|
Corporate Component
|
Threshold
50% payout
|
Target
100% payout
|
Maximum
200% payout
|
Weighting
|
Non-GAAP Revenue*
|
$781,000,000
|
$827,000,000
|
$872,000,000
|
40%
|
Non-GAAP EBITDA*
|
$247,000,000
|
$279,000,000
|
$311,000,000
|
40%
|
Recurring Revenue*
|
$559,000,000
|
$592,000,000
|
$625,000,000
|
20%
|
•
|
our Adjusted Non-GAAP revenue was $407.3 million, which was below the threshold attainment, resulting in a 0% payout with respect to this component;
|
•
|
our 2017 Adjusted Non-GAAP EBITDA was $61.5 million, which was below the threshold attainment, resulting in a 0% payout with respect to this component; and
|
•
|
because the Adjusted Non-GAAP revenue was less than the $781.0 million threshold, the NEOs were not entitled to any payout under the recurring revenue component regardless of what the 2017 Adjusted Non-GAAP recurring revenue was, resulting in a 0% payout with respect to this component.
|
Corporate Component
|
Achievement
|
Plan Payout
|
Weighting
|
Adjusted Non-GAAP Revenue*
|
$407,300,000
|
—%
|
60%
|
Adjusted Non-GAAP EBITDA*
|
61,500,000
|
—%
|
30%
|
Recurring Revenue*
|
307,300,000
|
—%
|
10%
|
*
|
This financial measure is a non-GAAP measures and should not be reviewed in isolation or as substitutes for our financial results as reported in accordance with GAAP. Please see Appendix A for an explanation and reconciliation of these non-GAAP financial measures to the applicable GAAP financial measures.
|
Name
|
2016-2018 Target Shares
|
2017 Target Shares
|
Attainment %
|
Performance Shares Earned
|
Stephen G. Waldis
|
52,951
|
17,650
|
0%
|
0
|
Robert E. Garcia
|
32,287
|
10,762
|
0%
|
0
|
Christopher S. Putnam
|
9,944
|
3,647
|
0%
|
0
|
Daniel Rizer
|
6,974
|
2,325
|
0%
|
0
|
Name
|
Threshold
|
Target
|
Maximum
|
Stephen G. Waldis
|
28,457
|
56,914
|
113,828
|
Robert E. Garcia
|
16,063
|
32,125
|
64,250
|
Lawrence Irving
|
23,827
|
47,654
|
95,308
|
Christopher S. Putnam
|
15.309
|
30.618
|
61,236
|
Daniel Rizer
|
10.206
|
20.412
|
40,824
|
Corporate Component
|
Threshold
50% payout
|
Target
100% payout
|
Maximum
200% payout
|
Weighting
|
Non-GAAP Revenue*
|
$781,000,000
|
$827,000,000
|
$872,000,000
|
40%
|
Non-GAAP EBITDA*
|
$247,000,000
|
$279,000,000
|
$311,000,000
|
40%
|
Recurring Revenue**
|
$559,000,000
|
$592,000,000
|
$625,000,000
|
20%
|
**
|
If the Company failed to reach the $781 million threshold revenue target, the NEOs would not qualify for any payout under the recurring revenue target.
|
•
|
our Adjusted Non-GAAP revenue was $407.3 million, which was above the target attainment, resulting in a 0% payout with respect to this component;
|
•
|
our 2017 Adjusted Non-GAAP EBITDA was $61.5 million, which was below the target attainment, resulting in a 0% payout with respect to this component; and
|
•
|
because the Adjusted Non-GAAP revenue was less than the $781.0 million target threshold, the NEOs were not entitled to any payout under the recurring revenue component regardless of what the 2017 Adjusted Non-GAAP recurring revenue was, resulting in a 0% payout with respect to this component.
|
Corporate Component
|
Achievement
|
Plan Payout
|
Weighting
|
Adjusted Non-GAAP Revenue*
|
$407,300,000
|
—%
|
60%
|
Adjusted Non-GAAP EBITDA*
|
61,500,000
|
—%
|
30%
|
Recurring Revenue*
|
307,300,000
|
—%
|
10%
|
|
|
|
|
|
|
$30 Stock Price (125%)
|
|
$35 Stock Price (150%)
|
|
|||||||
Participant
|
|
Target Cash
|
|
Target Shares
|
|
Cash
|
|
Shares
|
|
Cash
|
|
Shares
|
|
|||
Robert Garcia
|
|
|
$475,000
|
|
39,500
|
|
|
$593,750
|
|
49,375
|
|
|
$712,500
|
|
59,250
|
|
Lawrence Irving
|
|
|
$425,000
|
|
32,700
|
|
|
$531,250
|
|
40,875
|
|
|
$637,500
|
|
49,050
|
|
Christopher Putnam
|
|
|
$340,000
|
|
28,350
|
|
|
$425,000
|
|
35,438
|
|
|
$510,000
|
|
42,525
|
|
Daniel Rizer
|
|
|
$420,000
|
|
35,000
|
|
|
$525,000
|
|
43,750
|
|
|
$630,000
|
|
52,500
|
|
(1)
|
The material in this report is not “soliciting material,” is not deemed “filed” with the SEC and is not to be incorporated by reference in any filing of Synchronoss Technologies, Inc. under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
|
Name and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
(1)
|
Stock
Awards
($)
(2)
|
|
Option
Awards
($)
(11)
|
Non-Equity
Incentive Plan
Compensation
($)
(12)
|
All Other
Compensation
($)
|
|
Total
($)
|
|||||||
Glenn Lurie
|
2017
|
122,139
|
|
|
5,437,503
|
|
(3)
|
5,295,953
|
|
—
|
|
19,866
|
|
(13)
|
10,875,461
|
|
|
Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|||||||
Ron Hovsepian
|
2017
|
198,347
|
|
|
4,262,979
|
|
(4)
|
1,421,000
|
|
—
|
|
4,046,334
|
|
(14)
|
9,928,660
|
|
|
Former Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|||||||
Stephen G. Waldis
|
2017
|
603,220
|
|
|
4,374,900
|
|
(5)
|
1,468,232
|
|
748,155
|
|
20,888
|
|
(15)
|
7,215,395
|
|
|
Former Chief Executive Officer
|
2016
|
608,900
|
|
|
3,069,569
|
|
|
1,261,248
|
|
821,216
|
|
20,074
|
|
|
5,781,007
|
|
|
and Executive Chairman
|
2015
|
591,165
|
|
|
4,269,514
|
|
|
1,128,651
|
|
962,000
|
|
23,613
|
|
|
6,974,943
|
|
|
Lawrence Irving
|
2017
|
283,333
|
|
150,000
|
|
3,616,716
|
|
(6)
|
651,959
|
|
—
|
|
19,127
|
|
(16)
|
4,721,135
|
|
Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|||||||
John W. Frederick
|
2017
|
110,185
|
|
|
3,300,003
|
|
(7)
|
—
|
|
—
|
|
1,227,697
|
|
(17)
|
4,637,885
|
|
|
Former Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|||||||
Karen L. Rosenberger
|
2017
|
90,000
|
|
|
—
|
|
|
—
|
|
241,272
|
|
2,019,145
|
|
(18)
|
2,350,417
|
|
|
Former Chief Financial Officer
|
2016
|
360,000
|
|
|
748,682
|
|
|
307,617
|
|
242,409
|
|
63,338
|
|
|
1,722,046
|
|
|
|
2015
|
330,000
|
|
|
1,011,634
|
|
|
267,436
|
|
258,750
|
|
19,704
|
|
|
1,887,524
|
|
|
Robert E. Garcia
|
2017
|
475,000
|
|
|
4,573,719
|
|
(8)
|
833,334
|
|
402,301
|
|
17,700
|
|
(19)
|
6,302,054
|
|
|
Chief Commercial Officer
|
2016
|
450,204
|
|
|
1,871,677
|
|
|
769,056
|
|
433,770
|
|
17,150
|
|
|
3,541,857
|
|
|
|
2015
|
437,091
|
|
|
2,798,597
|
|
|
739,817
|
|
506,049
|
|
17,150
|
|
|
4,498,704
|
|
|
Christopher S. Putnam
|
2017
|
340,000
|
|
|
2,988,351
|
|
(9)
|
499,998
|
|
408,000
|
|
8,100
|
|
(20)
|
4,244,449
|
|
|
EVP, Sales
|
2016
|
340,000
|
|
|
738,124
|
|
|
225,711
|
|
375,000
|
|
7,950
|
|
|
1,686,785
|
|
|
|
2015
|
250,000
|
|
|
769,964
|
|
|
295,726
|
|
150,000
|
|
6,833
|
|
|
1,472,523
|
|
|
Daniel Rizer
|
2017
|
420,000
|
|
|
2,837,484
|
|
(10)
|
333,328
|
|
375,312
|
|
8,100
|
|
(20)
|
3,974,224
|
|
|
Chief Strategy Officer
|
2016
|
420,000
|
|
|
1,867,458
|
|
|
158,294
|
|
421,010
|
|
7,950
|
|
|
2,874,712
|
|
|
|
2015
|
385,786
|
|
|
539,996
|
|
|
159,911
|
|
279,282
|
|
7,800
|
|
|
1,372,775
|
|
(1)
|
The amounts set forth in this column represent the subjective individual component portion of our annual cash incentive bonus awards paid to the NEOs. See “Compensation Discussion and Analysis” above for further discussion of the subjective individual component.
|
(2)
|
The amounts in this column reflect the grant date fair value, computed in accordance with FASB ASC Topic No. 718, of the performance share awards (with the grant date fair value determined using the probable outcome of the performance conditions) and the time-based restricted share award granted to our NEOs. See “Compensation Discussion and Analysis” above for further discussion of these share awards. See Footnote 3 to the Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2017 for a discussion of our assumptions in estimating the fair value of our share awards. Our executive officers will not realize any value of these awards until these awards are sold.
|
||
(3)
|
Mr. Lurie was granted a performance-based restricted share award as a newly hired executive. The grant date value of the share award assuming the highest level of performance conditions is achieved was $3,625,002. Mr. Lurie’s actual performance based grant will be based on 2018 metrics. Mr. Lurie was also granted time-based restricted stock with a grant date value of $1,812,501.
|
||
(4)
|
Mr. Hovespian was granted a performance-based restricted share award as 2017-2019 Performance Shares as described in greater detail in “Compensation Discussion and Analysis.” The grant date value of the performance-based restricted share award assuming the highest level of performance conditions is achieved was $2,841,986; however, none of the financial goals were achieved in 2017, and, thus, there were no shares earned in 2017. Mr. Hovespian was also granted time-based restricted shares with a grant date value of $1,420,993.
|
||
(5)
|
Mr. Waldis was granted performance-based restricted awards under both the 2017-2019 Performance Shares plan as well as under a New Hire Executive Grant. The total grant date value of the performance-based restricted share awards assuming the highest level of performance conditions is achieved was $2,916,600. None of the financial goals were achieved in 2017, and, thus, there were no shares earned in 2017. Mr. Waldis was also granted time based restricted stock awards with a grant date value total of $1,458,300.
|
||
(6)
|
Mr. Irving was granted performance-based restricted share awards as 2017-2019 Performance Shares as described in greater detail in “Compensation Discussion and Analysis” above and performance-based restricted shares pursuant to the Retention Bonus Plan. The grant date value of the 2017-2019 Performance Shares assuming the highest level of performance conditions is achieved was $1,266,644; however, none of the financial goals were achieved in 2017, and, thus, there were no shares earned in 2017. The grant date value of the Retention Bonus Plan assuming the highest level of performance conditions is achieved was $1,716,750, which will be achieved if at any time prior to July 26, 2019, the volume-weighted average of our common stock’s closing price for 20 consecutive trading days exceeds $35. Mr. Irving was also granted time-based restricted stock grants as a new hire. The grant date value of the time-based restricted stock grants was $633,322.
|
||
(7)
|
Mr. Fredericks was granted performance-based restricted share awards as 2017-2019 Performance Shares as described in greater detail in “Compensation Discussion and Analysis.” The grant date value of the performance-based restricted share award assuming the highest level of performance conditions is achieved was $1,900,002; however, none of the financial goals were achieved in 2017, and, thus, there were no shares earned in 2017. Mr. Fredericks was also granted (i) time-based restricted shares with a grant date value of $950,001 and (ii) time-based restricted shares with a grant date value of $450,000.
|
||
(8)
|
Mr. Garcia was granted performance-based restricted share awards as 2017-2019 Performance Shares as described in greater detail in “Compensation Discussion and Analysis” above and performance-based restricted shares pursuant to the Retention Bonus Plan. The grant date value of the 2017-2019 Performance Shares assuming the highest level of performance conditions is achieved was $1,666,646; however, none of the financial goals were achieved in 2017, and, thus, there were no shares earned in 2017. The grant date value of the Retention Bonus Plan assuming the highest level of performance conditions is achieved was $2,073,750, which will be achieved if at any time prior to July 26, 2019, the volume-weighted average of our common stock’s closing price for 20 consecutive trading days exceeds $35. Mr. Garcia was also granted time-based restricted awards with a grant date value of $833,323.
|
||
(9)
|
Mr. Putnam was granted performance-based restricted share awards as 2017-2019 Performance Shares as described in greater detail in “Compensation Discussion and Analysis” above and performance-based restricted shares pursuant to the Retention Bonus Plan. The grant date value of the 2017-2019 Performance Shares assuming the highest level of performance conditions is achieved was $999,984; however, none of the financial goals were achieved in 2017, and, thus, there were no shares earned in 2017. The grant date value of the Retention Bonus Plan assuming the highest level of performance conditions is achieved was $1,488,375 which will be achieved if at any time prior to July 26, 2019, the volume-weighted average of our common stock’s closing price for 20 consecutive trading days exceeds $35. Mr. Putnam was also granted time-based awards with a grant date value of $499,992.
|
||
(10)
|
Mr. Rizer was granted performance-based restricted share awards as 2017-2019 Performance Shares as described in greater detail in “Compensation Discussion and Analysis” above and performance-based restricted shares pursuant to the Retention Bonus Plan. The grant date value of the 2017-2019 Performance Shares assuming the highest level of performance conditions is achieved was $666,656; however, none of the financial goals were achieved in 2017, and, thus, there were no shares earned in 2017. The grant date value of the Retention Bonus Plan assuming the highest level of performance conditions is achieved was $1,837,500 which will be achieved if at any time prior to July 26, 2019, the volume-weighted average of our common stock’s closing price for 20 consecutive trading days exceeds $35. Mr. Rizer was also granted time-based awards with a grant date value of $333,328.
|
||
(11)
|
The amounts in this column reflect the grant date fair value, computed in accordance with FASB ASC Topic No. 718, of option awards granted to our NEOs. See Footnote 2 to the Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2017 for a discussion of our assumptions in estimating the fair value of our stock option awards. Our NEOs will not realize any value with respect to these awards until these awards are exercised or sold.
|
||
(12)
|
The amounts under this column include amounts paid based on the objective corporate component of the Company’s annual incentive bonus compensation plan described under “Compensation Discussion and Analysis” above. The amounts shown are the 2016 bonuses paid in 2017.
|
||
(13)
|
Reflects amounts paid for (i) automobile expenses totaling $4,442 and (ii) housing expenses totaling $15,424.
|
||
(14)
|
Reflects amounts paid for (i) consulting services totaling $750,000 and (ii) severance payments totaling $3,246,792.
|
||
(15)
|
Reflects amounts paid for (i) automobile expenses and (ii) 401k company match of $8,100 totaling $20,888.
|
||
(16)
|
Reflects amounts paid for (i) automobile expenses and (ii) 401k company match of $8,100 totaling $19,127.
|
||
(17)
|
Reflects amounts paid for (i) final paid time off totaling $32,197 and (ii) severance totaling $1,195,500.
|
(18)
|
Reflects amounts paid for (i) final paid time off totaling $13,650, (ii) severance totaling $1,805,495 and (iii) a transition bonus totaling $200,000.
|
||
(19)
|
Reflects amounts paid for (i) automobile expenses totaling $9,600 and (ii) 401k company match of $8,100 totaling $17,700.
|
||
(20)
|
Reflects amounts paid for 401k company matching totaling $8,100.
|
|
|
Estimated Future Payouts
Under Non‑Equity Incentive Plan
Awards(1)
|
|
Estimated Future Payouts Under Equity Inventive Plan Awards (2)
|
|
Number
of
Shares
of Stock
|
Awards
Securities
Underlying
|
Exercise
or Base
Price of
Option
|
Value of
Stock and
Option
|
||||||||||||||
Name
(a)
|
Grant Date
|
Threshold
($)(1)(2)
|
Target
($)
|
Maximum
($)
|
|
Threshold
(#)(4)(5)
|
Target
(#)(3)
|
Maximum
(#)
|
|
or Units
(#)
|
Options
(#)
|
Awards
($/Sh)
|
Awards
($)(6)
|
||||||||||
Glenn
|
|
|
|
|
|
90,264
|
|
180,528
|
|
361,056
|
|
|
|
|
|
|
|||||||
Lurie
|
11/13/2017
|
|
|
|
|
|
|
|
|
180,528
|
|
|
|
1,812,501
|
|
||||||||
|
11/13/2017
|
|
|
|
|
|
|
|
|
|
507,101
|
|
10.04
|
|
1,781,953
|
|
|||||||
|
11/13/2017
|
|
|
|
|
|
|
|
|
|
1,000,000
|
|
10.04
|
|
3,514,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Stephen G.
|
|
343,750
|
|
687,500
|
1,203,125
|
|
|
28,457
|
|
56,914
|
|
113,828
|
|
|
|
|
|
|
|||||
Waldis
|
3/24/2017
|
|
|
|
|
|
|
|
|
43,240
|
|
|
|
1,121,646
|
|
||||||||
|
4/26/2017
|
|
|
|
|
|
|
|
|
13,674
|
|
|
|
336,654
|
|
||||||||
|
3/24/2017
|
|
|
|
|
|
|
|
|
|
123,545
|
|
25.94
|
|
121,665
|
|
|||||||
|
4/26/2017
|
|
|
|
|
|
|
|
|
|
40,219
|
|
24.62
|
|
346,567
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ron
|
|
—
|
|
—
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
|
|
|
|
|||||
Hovespian
|
3/24/2017
|
|
|
|
|
|
|
|
|
54,780
|
|
|
|
1,420,993
|
|
||||||||
|
3/24/2017
|
|
|
|
|
|
|
|
|
|
156,515
|
|
25.94
|
|
1,421,000
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Lawrence
|
|
170,000
|
|
340,000
|
595,000
|
|
|
|
|
|
|
|
|
|
|
||||||||
Irving
|
|
425,000
|
|
531,250
|
|
637,500
|
|
|
23,827
|
|
47,654
|
|
95,308
|
|
|
|
|
|
|
||||
|
7/26/2017
|
|
|
|
|
32,700
|
|
40,875
|
|
49,050
|
|
|
|
|
|
|
|||||||
|
4/27/2017
|
|
|
|
|
|
|
|
|
47,654
|
|
|
|
633,322
|
|
||||||||
|
4/27/2017
|
|
|
|
|
|
|
|
|
|
140,161
|
|
13.29
|
|
651,959
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
John W.
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
|
|
|
|
||||
Frederick
|
3/24/2017
|
|
|
|
|
|
|
|
|
36,623
|
|
|
|
950,001
|
|
||||||||
|
3/24/2017
|
|
|
|
|
|
|
|
|
17,348
|
|
|
|
450,007
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Karen
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Rosenberger
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Robert E.
|
|
190,000
|
|
380,000
|
|
665,000
|
|
|
|
|
|
|
|
|
|
|
|||||||
Garcia
|
|
475,000
|
|
593,750
|
|
712,500
|
|
|
16,063
|
|
32,125
|
|
64,250
|
|
|
|
|
|
|
||||
|
7/26/2017
|
|
|
|
|
39,500
|
|
49,375
|
|
59,250
|
|
|
|
|
|
|
|||||||
|
3/24/2017
|
|
|
|
|
|
|
|
|
32,125
|
|
|
|
833,323
|
|
||||||||
|
3/24/2017
|
|
|
|
|
|
|
|
|
|
91,787
|
|
25.94
|
|
833,334
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christopher
|
|
187,000
|
|
374,000
|
|
654,500
|
|
|
|
|
|
|
|
|
|
|
|||||||
Putnam
|
|
340,000
|
|
425,000
|
|
510,000
|
|
|
15,309
|
|
30,618
|
|
61,236
|
|
|
|
|
|
|
||||
|
7/26/2017
|
|
|
|
|
28,350
|
|
35,438
|
|
42,525
|
|
|
|
|
|
|
|||||||
|
5/8/2017
|
|
|
|
|
|
|
|
|
30,618
|
|
|
|
499,992
|
|||||||||
|
5/8/2017
|
|
|
|
|
|
|
|
|
|
87,481
|
|
16.33
|
|
499,998
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Daniel
|
|
168,000
|
|
336,000
|
|
588,000
|
|
|
|
|
|
|
|
|
|
|
|||||||
Rizer
|
|
420,000
|
|
525,000
|
|
630,000
|
|
|
10,206
|
|
20,412
|
|
40,824
|
|
|
|
|
|
|
||||
|
7/26/2017
|
|
|
|
|
35,000
|
|
43,750
|
|
52,500
|
|
|
|
|
|
333,328
|
|||||||
|
5/8/2017
|
|
|
|
|
|
|
|
|
20.412
|
|
58,320
|
|
16.33
|
|
333,328
|
(1)
|
Each of our NEOs, other than Mr. Lurie who was hired on November 13, 2017, was granted a non-equity incentive plan award pursuant to our 2017 annual incentive bonus compensation plan. The amounts shown in the “Threshold” column reflect the cash payment that would have been awarded under our 2017 annual incentive bonus plan if we had achieved the threshold payout level for a single corporate objective with the lowest weight. The amounts shown in the “Target” column reflect the target payment level under our 2017 annual incentive bonus plan if we had achieved all of the objectives previously approved by our Compensation Committee at target levels. The amounts shown in the “Maximum” column reflect the maximum payouts under our 2017 annual incentive bonus compensation plan if we had achieved all of the objectives previously approved by our Compensation Committee at or above the maximum level. The corporate and business components of our 2017 annual incentive bonus compensation plan are discussed in greater detail in “
Compensation Discussion and Analysis
” above. The actual amounts paid to each NEO are shown in the Summary Compensation Table above. The table does not include the individual discretionary component portion of the NEOs’ aggregate targeted annual cash incentive bonus amount.
|
(2)
|
Reflects non-equity award (cash) granted pursuant to the Retention Bonus Plan. The amounts shown in the “threshold” column reflects the minimum award granted under the Retention Bonus Plan. The “target” column above reflects the award granted if the volume-weighted average of our common stock’s closing price for 20 consecutive trading days exceeds $30. The “maximum” column reflects the award granted if the volume-weighted average of our common stock’s closing price for 20 consecutive trading days exceeds $35.
|
(3)
|
Represents target number of performance shares. The actual number of the shares subject to be issued, which could range from 0 to two times the initial target amount, will depend upon whether the issuer has met certain performance metrics for 2018 and 2019. One-half of the shares, if any, will be issued on or about March 2019 based on the issuer's performance for 2018 and the remaining one-half of the shares, if any, will be issued on or about March 2020 based on the issuer's performance for 2019.
|
(4)
|
Reflects 2017-2019 Performance Shares as described in greater detail in “Compensation Discussion and Analysis” above. The amounts shown in the “threshold” column reflect the 2017-2019 Performance Shares that will be earned if certain minimum financial goals are achieved. The amounts shown in the “target” column reflect the number of 2017-2019 Performance Shares that will be earned if all of the 2017-2019 financial goals are achieved at target levels. The amounts shown in the “maximum” column reflect the maximum number of 2017-2019 Performance Shares that can be earned if all of the 2017-2019 financial goals are achieved at or above maximum levels. None of the financial goals were achieved in 2017, and, thus, there were no shares earned in 2017.
|
(5)
|
Reflects restricted stock granted pursuant to the Retention Bonus Plan. The amounts shown in the “threshold” column reflects the minimum amount of shares granted under the Retention Bonus Plan. The “target” column above reflects the number of shares granted if the volume-weighted average of our common stock’s closing price for 20 consecutive trading days exceeds $30. The “maximum” column reflects the number of shares granted if the volume-weighted average of our common stock’s closing price for 20 consecutive trading days exceeds $35.
|
(6)
|
The amount in this column reflects the grant date fair value, computed in accordance with FASB ASC Topic No. 718, of stock awards and options granted to our NEOs. See Footnote 3 to the Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2017 for a discussion of our assumptions in estimating the fair value of our stock and option awards.
|
•
|
Glenn Lurie:
On November 13, 2017, we granted Mr. Lurie (i) an option to purchase 507,101 shares of our Common Stock, (ii) 180,528 time-based restricted shares of our Common Stock, (iii) a target award of 180,528 Performance Shares, which are earned based on our Company’s achievement of performance metrics to be established by the Committee in 2018 and (iv) an option to purchase 1,000,000 shares of our Common Stock that does not vest until the third anniversary of the grant date.
|
•
|
Stephen G. Waldis:
On March 24, 2017, we granted Mr. Waldis (i) an option to purchase 123,545 shares of our Common Stock, (ii) 43,240 time-based restricted shares of our Common Stock, and (iii) a target award of 43,240 Performance Shares. On April 27, 2017 in connection with Mr. Waldis being appointed as our Chief Executive Officer, we granted Mr. Waldis (i) an option to purchase 40,219 shares of our Common Stock, (ii) 13,674 time-based restricted shares of our Common Stock, and (iii) a target award of 13,674 Performance Shares. |
•
|
Ron Hovsepian:
On March 24, 2017, we granted Mr. Hovsepian (i) an option to purchase 156,515 shares of our Common Stock, (ii) 54,780 time-based restricted shares of our Common Stock, and (iii) a target award of 54,780 Performance Shares. All of these shares were forfeited in connection with Mr. Hovespian’s termination except for 18,260 shares of common stock that were vested. |
•
|
Lawrence Irving:
On April 27, 2017 we granted Mr. Irving (i) an option to purchase 140,161 shares of our Common Stock, (ii) 47,654 time-based restricted shares of our Common Stock, and (iii) a target award of 47,654 2017 Performance Shares, which are earned based on our Company’s achievement of performance metrics discussed in the Compensation Discussion and Analysis section of this Form 10-k. On July 26, 2017, we issued 32,700 Retention Restricted Shares to Mr. Irving under our Retention Plan. |
•
|
John W. Frederick:
On March 24, 2017 we granted Mr. Frederick (i) 36,623 time-based restricted shares of our Common Stock, (ii) 17,348 time-based restricted shares of our Common Stock, and (iii) a target award of 36,623 2017 Performance Shares. As the result of Mr. Frederik’s resignation on April 27, 2017, all of these restricted shares were unvested and forfeited on the same date. |
•
|
Robert E. Garcia:
On March 24, 2017, we granted Mr. Garcia (i) an option to purchase 91,787 shares of our Common Stock, (ii) 32,125 time-based restricted shares of our Common Stock, and (iii) a target award of 32,125 Performance Shares, which are earned based on the Company’s achievement of performance metrics discussed in the Compensation Discussion and Analysis section of this Form 10-k. On July 26, 2017, we issued 39,500 Retention Restricted Shares to Mr. Garcia under our Retention Plan.
|
•
|
Christopher S. Putnam:
On May 8, 2017, we granted Mr. Putnam (i) an option to purchase 87,481 shares of our Common Stock and (ii) 30,618 time-based restricted shares of our Common Stock and (iii) a target award of 30,618 Performance Shares, which are earned based on the Company’s achievement of performance metrics discussed in the Compensation Discussion and Analysis section of this Form 10-k. On July 26, 2017, we issued 28,350 Retention Restricted Shares to Mr. Putnam under our Retention Plan. |
•
|
Daniel Rizer:
On May 8, 2017, we granted Mr. Rizer (i) an option to purchase 58,320 shares of our Common Stock and (ii) 20,412 time-based restricted shares of our Common Stock and (iii) a target award of 20,412 Performance Shares, which are earned based on the Company’s achievement of performance metrics discussed in the Compensation Discussion and Analysis section of this Form 10-K. .On July 26, 2017, we issued 35,000 Retention Restricted Shares to Mr. Rizer under our Retention Plan. |
|
Option Awards
|
|
Stock Awards
|
||||||||||||||||
Name
|
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
|
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
|
Number of Shares or Units of Stock That Have Not Vested
(#)
|
Market Value of Shares or Units of Stock That Have Not
Vested
($)(1)
|
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)
|
Equity Incentive Plan Awards: Market or Payout Value
of Unearned Shares, Units or Other Rights That Have Not Vested
(#)(31)
|
||||||||||
Glenn Lurie
|
—
|
|
|
507,101
|
|
(13)
|
10.04
|
11/13/2024
|
|
|
|
|
|
|
|
||||
|
—
|
|
|
1,000,000
|
|
(14)
|
10.04
|
11/13/2024
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
180,528
|
|
(2)
|
1,613,920
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
180,528
|
|
(30)
|
1,613,920
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Stephen G. Waldis
|
160,000
|
|
(3)
|
—
|
|
|
30.50
|
12/6/2018
|
|
|
|
|
|
|
|
||||
|
76,400
|
|
(4)
|
—
|
|
|
31.02
|
2/14/2020
|
|
|
|
|
|
|
|
||||
|
83,771
|
|
(5)
|
3,642
|
|
|
32.40
|
2/13/2021
|
|
|
|
|
|
|
|
||||
|
49,970
|
|
(6)
|
20,576
|
|
|
41.37
|
2/9/2022
|
|
|
|
|
|
|
|
||||
|
60,978
|
|
(7)
|
72,065
|
|
|
25.81
|
2/19/2023
|
|
|
|
|
|
|
|
||||
|
—
|
|
|
123,545
|
|
(11)
|
25.94
|
3/24/2024
|
|
|
|
|
|
|
|
||||
|
—
|
|
|
40,219
|
|
(12)
|
24.62
|
4/26/2024
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
8,633
|
|
(19)
|
77,179
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
35300
|
|
(20)
|
315,582
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
43,240
|
|
(21)
|
386,566
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
13,674
|
|
(8)
|
122,246
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
38,204
|
|
(9)
|
341,543
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
105,902
|
|
(26)
|
946,764
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
51,802
|
|
(27)
|
463,110
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
86,480
|
|
(28)
|
773,131
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
27,348
|
|
(28)
|
244,491
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Ron Hovsepian
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Lawrence Irving
|
—
|
|
|
140,161
|
|
(15)
|
13.29
|
4/27/2024
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
47,654
|
|
(22)
|
426,026.76
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
95,308
|
|
-28
|
852,053
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
49,050
|
|
(29)
|
438,507
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
John W. Frederick
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
—
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Karen L. Rosenberger
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
—
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Robert E. Garcia
|
12,323
|
|
(4)
|
—
|
|
|
31.02
|
2/14/2020
|
|
|
|
|
|
|
|
||||
|
38,958
|
|
(5)
|
2,292
|
|
|
32.40
|
2/13/2021
|
|
|
|
|
|
|
|
||||
|
32,755
|
|
(6)
|
13,487
|
|
|
41.37
|
2/9/2022
|
|
|
|
|
|
|
|
||||
|
37,182
|
|
(7)
|
43,942
|
|
|
25.81
|
2/19/2023
|
|
|
|
|
|
|
|
||||
|
—
|
|
|
91,787
|
|
(11)
|
25.94
|
3/24/2024
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
5,659
|
|
(19)
|
50,591
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
21,524
|
(20)
|
192,425
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
32,125
|
|
(21)
|
287,198
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
25,043
|
(9)
|
223,884
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
64,574
|
|
(26)
|
577,292
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
33,956
|
|
(27)
|
303,567
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
64,250
|
|
(28)
|
574,395
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
59,250
|
|
(29)
|
529,695
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Christopher Putnam
|
1,938
|
|
(16)
|
969
|
|
|
50.31
|
4/15/2022
|
|
|
|
|
|
|
|
||||
|
9,432
|
|
(17)
|
8,677
|
|
|
36.06
|
11/13/2022
|
|
|
|
|
|
|
|
||||
|
11,452
|
|
(7)
|
13,534
|
|
|
25.81
|
2/19/2023
|
|
|
|
|
|
|
|
||||
|
—
|
|
|
87,481
|
|
(18)
|
16.33
|
5/8/2024
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
356
|
|
(23)
|
3,183
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
4,000
|
|
(10)
|
35,760
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
6,629
|
|
(20)
|
59,263
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
30,618
|
|
(24)
|
273,725
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
19,888
|
|
(26)
|
177,799
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
2,138
|
|
(27)
|
19,114
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
61,236
|
|
(28)
|
547,450
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
42,525
|
|
(29)
|
380,174
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Daniel Rizer
|
2,200
|
|
(4)
|
—
|
|
|
31.02
|
2/14/2020
|
|
|
|
|
|
|
|
||||
|
7,275
|
|
(5)
|
625
|
|
|
32.40
|
2/13/2021
|
|
|
|
|
|
|
|
||||
|
7,400
|
|
(6)
|
3,047
|
|
|
41.37
|
2/9/2022
|
|
|
|
|
|
|
|
|
8,032
|
|
(7)
|
9,491
|
|
|
25.81
|
2/19/2023
|
|
|
|
|
|
|
|
||||
|
—
|
|
|
58,320
|
|
(18)
|
16.33
|
5/8/2024
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
1,278
|
|
(19)
|
11,425
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
6,666
|
|
(25)
|
59,594
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
4,649
|
|
(20)
|
41,562
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
20,412
|
|
(24)
|
182,483
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
5,658
|
|
(32)
|
50,583
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
13,948
|
|
(26)
|
124,695
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
7,702
|
|
(27)
|
6,858
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
40,824
|
|
(28)
|
364,967
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
52,500
|
|
(29)
|
469,350
|
|
(1)
|
Computed in accordance with SEC rules as the number of unvested shares multiplied by the closing market price per share of our Common Stock on December 29, 2017, which was the last trading day of 2017, which was $8.94 per share. The actual value (if any) to be realized by the NEO depends on whether the shares vest and the future performance of our Common Stock. Each of the options and restricted shares automatically vest if we are acquired and the NEO is either involuntarily terminated or voluntarily resigns for good reason under certain circumstances following our change of control, as discussed in more detail below under “
Employment Agreements
.”
|
|||
(2)
|
Reflects restricted shares granted on November 13, 2017. One-third of the shares vested on November 13, 2018 and one-third of the shares will vest on each of November 13, 2019 and 2020, provided the NEO remains continuously employed by the Company on those dates.
|
|||
(3)
|
The option vested over four years of continuous service following December 6, 2011, with 25% vesting after the first year of service and the remaining shares vesting in equal monthly installments over an additional 36 months of continuous service. As a result, the option is fully exercisable.
|
|||
(4)
|
The option vested over four years of continuous service following February 14, 2013, with 25% vesting after the first year of service and the remaining shares vesting in equal monthly installments over an additional 36 months of continuous service. As a result, the option became fully exercisable on February 14, 2017.
|
|||
(5)
|
The option vests over four years from the vesting start date of February 13, 2014, with 25% vesting after the completion of the first year of service to the Company and the remaining shares vesting in equal monthly installments over an additional 36 months of continuous service to the Company. As a result, the option will be fully exercisable on February 13, 2018.
|
|||
(6)
|
The option vests over four years of continuous service following February 9, 2015, with 25% vesting after the first year of service and the remaining shares vesting in equal monthly installments over an additional 36 months of continuous service. As a result, the option will be fully exercisable on February 9, 2019.
|
|||
(7)
|
The option vests over four years of continuous service following February 19, 2016, with 25% vesting after the first year of service and the remaining shares vesting in equal monthly installments over an additional 36 months of continuous service. As a result, the option will be fully exercisable on February 19, 2020.
|
|||
(8)
|
Reflects restricted shares granted on April 26, 2017. One-third of the shares vested on April 26, 2018 and one-third of the shares will vest on each of April 26, 2019 and 2020 provided the NEO remains continuously employed by the Company on those dates.
|
|||
(9)
|
Reflects restricted shares granted on June 30, 2015. The shares fully vested on February 17, 2018.
|
|||
(10)
|
Reflects restricted shares vesting over four years of continuous service following November 13, 2015, with 25% of the shares vesting after the first year of service and the remaining shares vesting ratably on a quarterly basis thereafter, provided the NEO remains continuously employed by the Company through those dates.
|
|||
(11)
|
The options shall become exercisable with respect to the first 25% of the shares subject to the option when the Reporting Person completes 12 months of continuous service after March 24, 2017. The option shall become exercisable to an additional 1/48th of the shares subject to the option when the Reporting Person completes each month of continuous service thereafter.
|
|
|
Option Awards
|
|
|
Stock Awards
|
|
Name
|
|
Number of Shares Acquired on
Exercise (#)
|
Value Realized on Exercise ($)
(1)
|
|
Number of Shares Acquired on
Vesting (#)
|
Value Realized on Vesting ($)
(1)
|
Glenn Lurie
|
|
—
|
—
|
|
—
|
—
|
Ronald Hovsepian
|
|
—
|
—
|
|
18,260
|
242,675
|
Stephen G. Waldis
|
|
—
|
—
|
|
74,126
|
2,580,863
|
Lawrence Irving
|
|
—
|
—
|
|
—
|
—
|
John Frederick
|
|
—
|
—
|
|
—
|
—
|
Karen Rosenberger
|
|
777
|
3,700
|
|
14,502
|
498,928
|
Robert E. Garcia
|
|
22,320
|
167,986
|
|
48,125
|
1,676,691
|
Christopher S. Putnam
|
|
—
|
—
|
|
11,921
|
286,037
|
Daniel Rizer
|
|
—
|
—
|
|
17,358
|
479,247
|
Name
|
Benefit
|
Voluntary
Resignation/
Termination
for Cause
($)
|
Involuntary Termination Prior to, or More Than 24 Months after, a Change in Control
($)
|
|
Termination Due to Death or Disability
($)
|
|
Involuntary
Termination
Within 24 Months
After a Change
in Control
($)
|
||||||||
Glenn Lurie
|
Severance
(1)
|
$
|
—
|
|
$
|
3,300,000
|
|
(10)
|
$
|
900,000
|
|
|
$
|
4,042,500
|
|
|
Option Acceleration
(2)
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Restricted Stock Acceleration
(3)
|
—
|
|
537,973
|
|
|
1,613,920
|
|
|
1,613,920
|
|
||||
|
Accrued Vacation
(6)
|
48,077
|
|
48,077
|
|
|
48,077
|
|
|
48,077
|
|
||||
|
Benefit Continuation
(7)
|
—
|
|
30,550
|
|
|
30,550
|
|
(8)
|
30,550
|
|
||||
|
Total Value
|
$
|
48,077
|
|
$
|
3,916,600
|
|
|
$
|
2,592,547
|
|
|
$
|
5,735,047
|
|
|
|
|
|
|
|
|
|
||||||||
Stephen G. Waldis
|
Severance
(1)
|
$
|
—
|
|
$
|
1,998,155
|
|
|
$
|
687,500
|
|
|
$
|
2,616,905
|
|
|
Option Acceleration
(2)
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Restricted Stock Acceleration
(3)
|
—
|
|
—
|
|
|
1,243,116
|
|
|
1,243,116
|
|
||||
|
Accrued Vacation
(6)
|
48,077
|
|
48,077
|
|
|
48,077
|
|
|
48,077
|
|
||||
|
Benefit Continuation
(7)
|
—
|
|
30,550
|
|
|
30,550
|
|
(8)
|
30,550
|
|
||||
|
Total Value
|
$
|
48,077
|
|
$
|
2,076,782
|
|
|
$
|
2,009,243
|
|
|
$
|
3,938,648
|
|
|
|
|
|
|
|
|
|
||||||||
Lawrence Irving
|
Severance
(1)
|
$
|
—
|
|
$
|
1,147,500
|
|
|
$
|
340,000
|
|
|
$
|
1,221,159
|
|
|
Option Acceleration
(2)
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Restricted Stock Acceleration
(3)
|
—
|
|
—
|
|
|
718,365
|
|
|
718,365
|
|
||||
|
Retention Plan Equity Acceleration
|
—
|
|
292,338
|
|
(4)
|
292,338
|
|
(4)
|
292,338
|
|
||||
|
Retention Plan Non-Equity
|
—
|
|
425,000
|
|
(5)
|
425,000
|
|
(5)
|
425,000
|
|
||||
|
Accrued Vacation
(6)
|
32,692
|
|
32,692
|
|
|
32,692
|
|
|
32,692
|
|
||||
|
Benefit Continuation
(7)
|
—
|
|
19,847
|
|
|
19,847
|
|
(8)
|
19,847
|
|
||||
|
Total Value
|
$
|
32,692
|
|
$
|
1,917,377
|
|
|
$
|
1,828,242
|
|
|
$
|
2,709,401
|
|
|
|
|
|
|
|
|
|
||||||||
Robert E. Garcia
|
Severance
(1)
|
$
|
—
|
|
$
|
1,068,750
|
|
|
$
|
380,000
|
|
|
$
|
1,425,000
|
|
|
Option Acceleration
(2)
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Restricted Stock Acceleration
(3)
|
—
|
|
—
|
|
|
1,107,228
|
|
|
1,107,228
|
|
||||
|
Retention Plan Equity Acceleration
|
—
|
|
353,130
|
|
(4)
|
353,130
|
|
(4)
|
353,130
|
|
||||
|
Retention Plan Non-Equity
|
—
|
|
475,000
|
|
(5)
|
475,000
|
|
(5)
|
475,000
|
|
||||
|
Accrued Vacation
(6)
|
36,538
|
|
36,538
|
|
|
36,538
|
|
|
36,538
|
|
||||
|
Benefit Continuation
(7)
|
—
|
|
27,875
|
|
|
27,875
|
|
(8)
|
27,875
|
|
||||
|
Total Value
|
$
|
36,538
|
|
$
|
1,961,293
|
|
|
$
|
2,379,771
|
|
|
$
|
3,424,771
|
|
|
|
|
|
|
|
|
|
||||||||
Christopher S. Putnam
|
Severance
(1)
|
$
|
—
|
|
$
|
816,000
|
|
|
$
|
408,000
|
|
|
$
|
1,088,000
|
|
|
Option Acceleration
(2)
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Restricted Stock Acceleration
(3)
|
—
|
|
—
|
|
|
625,379
|
|
|
625,379
|
|
||||
|
Retention Plan Equity Acceleration
|
—
|
|
253,449
|
|
(4)
|
253,449
|
|
(4)
|
253,449
|
|
||||
|
Retention Plan Non-Equity
|
—
|
|
340,000
|
|
(5)
|
340,000
|
|
(5)
|
340,000
|
|
||||
|
Accrued Vacation
(6)
|
26,154
|
|
26,154
|
|
|
26,154
|
|
|
26,154
|
|
||||
|
Benefit Continuation
(7)
|
—
|
|
13,941
|
|
|
27,882
|
|
(8)
|
27,882
|
|
||||
|
Total Value
|
$
|
26,154
|
|
$
|
1,449,544
|
|
|
$
|
1,680,864
|
|
|
$
|
2,360,864
|
|
|
|
|
|
|
|
|
|
||||||||
Daniel Rizer
|
Severance
(1)
|
$
|
—
|
|
$
|
911,484
|
|
|
$
|
336,000
|
|
|
$
|
1,215,312
|
|
|
Option Acceleration
(2)
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Restricted Stock Acceleration
(3)
|
—
|
|
—
|
|
|
658,547
|
|
|
658,547
|
|
||||
|
Retention Plan Equity Acceleration
|
—
|
|
312,900
|
|
(4)
|
312,900
|
|
(4)
|
312,900
|
|
||||
|
Retention Plan Non-Equity
|
—
|
|
420,000
|
|
(5)
|
420,000
|
|
(5)
|
420,000
|
|
||||
|
Accrued Vacation
(6)
|
32,308
|
|
32,308
|
|
|
32,308
|
|
|
32,308
|
|
||||
|
Benefit Continuation
(7)
|
—
|
|
15,275
|
|
|
30,550
|
|
(8)
|
30,550
|
|
||||
|
Total Value
|
$
|
32,308
|
|
$
|
1,691,967
|
|
|
$
|
1,790,305
|
|
|
$
|
2,669,617
|
|
(1)
|
For purposes of valuing cash severance payments in the table above, we used each executive officer’s base salary as of December 31, 2017. For purposes of calculating cash severance payments in the table above in the event of an involuntary termination (whether prior to, within 24 months following, or more than 24 months following, a change in control), we used each NEO’s average annual bonuses for 2016 and 2017 and, for purposes of calculating cash severance payments in the table above in the event of a termination due to permanent disability, we used the NEO’s target bonus as of December 31, 2017.
|
|
(2)
|
The value of option acceleration shown in the table above was calculated based on the assumption that the triggering event occurred on December 31, 2017. The value of the vesting acceleration was calculated by multiplying the number of unvested shares subject to each option by the excess of the closing price of our Common Stock on December 29, 2017, the last trading day of the year, over the exercise price of the option.
|
|
(3)
|
The value of restricted stock acceleration shown in the table above was calculated based on the assumption that the triggering event occurred on December 31, 2017. The value of the vesting acceleration was calculated by multiplying the number of unvested shares subject to each restricted stock grant by the closing price of our Common Stock on December 29, 2017, the last trading day of the year.
|
|
(4)
|
Amount shown reflects the total price of the Target number of shares earned based on the assumption that the triggering event occurred on December 31, 2017. The value of the vesting acceleration was calculated by multiplying the Target shares by the closing price of our Common Stock on December 29, 2017, the last trading day of the year. Participants in the Retention Bonus Plan may earn higher amounts of shares if the closing price of the volume-weighted average of the Company’s Common Stock exceeds a certain price for 20 consecutive trading days at any point prior to July 26, 2019. In the event of an Involuntary Termination other than for death or disability, the performance multiplier will be the greater of the Target multiplier or the highest Common Stock closing price level attained over 20 consecutive trading days. In the event of an Involuntary Termination for death or disability, the Company may elect to waive the Company’s volume-weighted average Common Stock closing price for 20 consecutive trading days. The below table represents the price level and performance multiplier for each participant in the Retention Bonus Plan.
|
|
|
Participant | Target Shares | Shares if $30 Stock Price (125%) | Shares if $35 Stock Price (150%)
Garcia | 39,500 | 49,375 | 59,250
Irving | 32,700 | 40,875 | 49,050
Putnam | 28,350 | 35,458 | 45,525
Rizer | 35,000 | 43,750 | 52,500
|
|
(5)
|
Amount shown reflects the Target cash under the Retention Bonus Plan that would have been the amount granted had the triggering event occurred on December 31, 2017. Participants in the Retention Bonus Plan may earn higher amounts of cash if the closing price of the volume-weighted average of the Company’s Common Stock exceeds a certain price for 20 consecutive trading days at any point prior to July 26, 2019. In the event of an Involuntary Termination other than for death or disability, the performance multiplier will be the greater of the Target multiplier or the highest Common Stock closing price level attained over 20 consecutive trading days. In the event of an Involuntary Termination for death or disability, the Company may elect to waive the Company’s volume-weighted average Common Stock closing price for 20 consecutive trading days. The below table represents the price level and performance multiplier for each participant in the Retention Bonus Plan.
|
|
|
Participant | Target Cash ($) | Cash ($) if $30 Stock Price (125%) | Cash ($) if $35 Stock Price (150%)
Garcia | 475,000 | 593,750 | 712,500
Irving | 425,000 | 531,250 | 637,500
Putnam | 340,000 | 425,000 | 510,000
Rizer | 420,000 | 525,000 | 630,000
|
|
(6)
|
Based on each executive officer’s base salary in effect and twenty (20) accrued but unused vacation days.
|
|
(7)
|
Amounts reflect two times the current cost to us of the individual’s health and welfare benefits per year.
|
|
(8)
|
Only payable in the event of a termination due to permanent disability.
|
|
(9)
|
Amounts reflect 1.0 the current costs to us of the individual’s health and welfare benefits per year for Involuntary Termination without change in control; 2.0 the current costs to us of the individual’s health and welfare benefits per year for Disability or Termination due to change in control.
|
|
(10)
|
Receives 12 months of accelerated vesting for options and awards resulting from involuntary termination without change in control.
|
|
•
|
The median of the annual total compensation of all employees (other than our CEO) was $74,216; and
|
•
|
The annual total compensation of our CEO, as reported in the 2017 Summary Compensation Table included elsewhere in this Proxy Statement, was $10,875,461.
|
Plan Category
|
Number of Securities to be Issued Upon Exercise of Outstanding Options Warrants and Rights
(a)
|
|
Weighted-Average Exercise Price of Outstanding Options Warrants and Rights
(b)
|
|
Number of Securities for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column
(a)
)
(c)
|
|||||
Equity compensation plans approved by security holders
|
2,329,353
|
|
(1)
|
|
|
2,293,712
|
|
(2)
|
||
Equity compensation plans not approved by security holders
(3)
|
3,775
|
|
|
$
|
19.32
|
|
|
—
|
|
|
Total
|
2,333,128
|
|
|
$
|
32.46
|
|
|
2,293,712
|
|
|
(1)
|
In addition, as of December 31, 2016, there were 1,918,437 shares of unvested restricted common stock outstanding, which shares are subject to the risk of forfeiture if the underlying time-based or performance-based vesting conditions are not satisfied.
|
(2)
|
As of March, 27 2017, there were 3,458,574 shares available for issuance under the 2015 Equity Incentive Plan, which includes shares that were assumed from the Intralinks Holdings, Inc. 2010 Equity Incentive Plan in connection with the consummation of the Intralinks Transaction.
|
(3)
|
Consists of the 2010 New Hire Equity Incentive Plan, which we assumed in connection with the acquisition of FusionOne, Inc.
|
|
|
(1)
|
The material in this report is not “soliciting material,” is not deemed “filed” with the SEC and is not to be incorporated by reference in any filing of Synchronoss Technologies, Inc. under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
|
•
|
each person, or group of affiliated persons, who is known by us to beneficially own more than five percent (5%) of our outstanding Common Stock or Series A Preferred Stock;
|
•
|
each of our named executive officers;
|
•
|
each of our current directors and directors that served during 2017; and
|
•
|
all of our current directors and executive officers as a group.
|
|
Common Stock Beneficially Owned
|
|
Series A Preferred Stock Beneficially Owned
|
||
Name
|
Shares
|
%
|
|
Shares
|
%
|
5% Stockholders
|
|||||
Silver Private Holdings I, LLC (1)
601 Lexington Avenue, 59th Floor
New York, NY 10022 |
10,443,430
(2)
|
19.99%
|
|
188,353
|
100.0%
|
The Vanguard Group (3)
100 Vanguard Blvd. Malvern, PA 19355 |
3,687,733
|
8.8%
|
|
—
|
—
|
Elk Creek Partners, LLC (4)
44 Cook St., Suite 705
Denver, CO 80206
|
2,487,832
|
6.00%
|
|
0
|
0.0%
|
|
|
|
|
|
|
(1)
|
Silver Private Holdings I, LLC (“Silver Holdings”) is controlled by its sole member, Silver Private Investments, LLC (“Silver Parent”). Silver Parent is controlled by its members, Siris Partners III, L.P. (“Siris Fund III”) and Siris Partners III Parallel, L.P. (“Siris Fund III Parallel”). Each of Siris Fund III and Siris Fund III Parallel is controlled by its general partner, Siris Partners GP III, L.P. (“Siris Fund III GP”). Siris Fund III GP is controlled by its general partner, Siris GP HoldCo III, LLC (“Siris Fund III GP HoldCo”). Siris Capital Group III, L.P. (“Siris Fund III Advisor”) serves as investment manager to Siris Fund III and Siris Fund III Parallel pursuant to investment management agreements with each of them. Siris Capital Group, LLC (“Siris Capital Group”) shares investment management authority in respect of Siris Fund III and Siris Fund III Parallel pursuant to an agreement between Siris Fund III Advisor and Siris Capital Group. Siris Fund III Advisor is controlled by its general partner, Siris Advisor HoldCo III, LLC (“Siris Fund III Advisor HoldCo”). Siris Capital Group is controlled by its managing member, Siris Advisor HoldCo, LLC (“Siris Advisor HoldCo”). Each of Siris Fund III GP HoldCo, Siris Fund III Advisor HoldCo and Siris Advisor HoldCo is controlled by Frank Baker, Peter Berger and Jeffrey Hendren. Based on a Schedule 13D/A filed with the SEC on February 20, 2018.
|
(2)
|
Consists of shares of our Common Stock issuable upon conversion of the Series A Preferred Stock held by Silver Holdings, subject to the Conversion Cap.
|
(3)
|
Based on a Schedule 13G/A filed with the SEC on February 9, 2018.
|
(4)
|
Based on a Schedule 13G/A filed with the SEC on February 13, 2018.
|
(5)
|
Includes 327,834 shares subject to options exercisable within 60 days of May 31, 2018. Excludes [•] shares subject to options not exercisable within 60 days of May 31, 2018.
|
(6)
|
Includes 55,592 shares of restricted common stock subject to the Company’s lapsing right of repurchase. Includes 518,202 shares subject to options exercisable within 60 days of May 31, 2018. Excludes 172,954 shares subject to options not exercisable within 60 days of May 31, 2018.
|
(7)
|
Includes 120,625 shares of restricted common stock subject to the Company’s lapsing right of repurchase. Includes 43,801 shares subject to options exercisable within 60 days of May 31, 2018. Excludes 139,054 shares subject to options not exercisable within 60 days of May 31, 2018.
|
(8)
|
Includes 145,831 shares of restricted common stock subject to the Company’s lapsing right of repurchase. Includes 172,679 shares subject to options exercisable within 60 days of May 31, 2018. Excludes 156,223 shares subject to options not exercisable within 60 days of May 31, 2018.
|
(9)
|
Includes 57,627 shares of restricted common stock subject to the Company’s lapsing right of repurchase. Includes 55,047 shares subject to options exercisable within 60 days of May 31, 2018. Excludes 78,436 shares subject to options not exercisable within 60 days of May 31, 2018.
|
(10)
|
Includes 43,104 shares of restricted common stock subject to the Company’s lapsing right of repurchase. Includes 37,281 shares subject to options exercisable within 60 days of May 31, 2018. Excludes 25,186 shares subject to options not exercisable within 60 days of May 31, 2018.
|
(11)
|
Includes 43,104 shares of restricted common stock subject to the Company’s lapsing right of repurchase. Includes 37,281 shares subject to options exercisable within 60 days of May 31, 2018. Excludes 25,186 shares subject to options not exercisable within 60 days of May 31, 2018.
|
(12)
|
Includes 43,104 shares of restricted common stock subject to the Company’s lapsing right of repurchase. Includes37,281 shares subject to options exercisable within 60 days of May 31, 2018. Excludes 25,186 shares subject to options not exercisable within 60 days of May 31, 2018.
|
(13)
|
Includes 39,518 shares of restricted common stock subject to the Company’s lapsing right of repurchase. Includes 37,281 shares subject to options exercisable within 60 days of May 31, 2018. Excludes 25,186 shares subject to options not exercisable within 60 days of May 31, 2018.
|
(14)
|
Includes securities beneficially owned by Silver Holdings as set forth in footnote 1 above, for which Mr. Baker may be deemed to share voting and investment power. Mr. Baker disclaims beneficial ownership of the securities held by Silver Holdings except to the extent of his pecuniary interest therein, if any.
|
(15)
|
Includes securities beneficially owned by Silver Holdings as set forth in footnote 1 above, for which Mr. Berger may be deemed to share voting and investment power. Mr. Berger disclaims beneficial ownership of the securities held by Silver Holdings except to the extent of his pecuniary interest therein, if any.
|
(16)
|
Excludes 30,000 shares subject to options not exercisable within 60 days of May 31, 2018.
|
(17)
|
Includes 1,207,869 shares of restricted common stock subject to the Company’s lapsing right of repurchase. Includes1,082,180 shares subject to options exercisable within 60 days of May 31, 2018. Excludes 2,494,566 shares subject to options not exercisable within 60 days of May 31, 2018.
|
|
Fiscal Year Ended
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Audit Fees
(1)
|
$
|
23,220
|
|
|
$
|
3,025
|
|
Audit Related Fees
(2)
|
3
|
|
|
235
|
|
||
Total Fees
|
$
|
23,223
|
|
|
$
|
3,260
|
|
(1)
|
For professional services rendered for the audits of annual financial statements, including the audit of annual financial statements and audit of internal control over financial reporting for the years ended December 31, 2017 and 2016. The audit fees also include the review of quarterly financial statements included in the Company’s quarterly reports on Form 10-Q, statutory audits of foreign subsidiaries and other regulatory filings or similar engagements.
|
(2)
|
Includes fees that are for assurance and related services other than those included in Audit Fees and primarily relate to due diligence services relating to an acquisition.
|
Exhibit No.
|
|
Description
|
|
3.1
|
|
|
|
3.2
|
|
|
|
3.3
|
|
|
|
3.4
|
|
|
|
4.1
|
|
|
|
4.2
|
|
|
|
4.3
|
|
|
|
4.4
|
|
|
|
4.5
|
|
|
|
4.6
|
|
|
|
4.7
|
|
|
|
4.8
|
|
|
|
10.1
|
|
|
|
10.2
|
|
|
|
10.3
|
|
|
|
10.4
|
|
|
|
10.4.1
|
|
|
|
10.4.2
|
|
|
|
10.5
|
|
|
Exhibit No.
|
|
Description
|
|
10.6
|
|
|
|
10.7‡
|
|
|
|
10.8
‡
|
|
|
|
10.9
‡
|
|
|
|
10.10
‡
|
|
|
|
10.11
‡
|
|
|
|
10.12
‡
|
|
|
|
10.13
‡
|
|
|
|
10.14
‡
|
|
|
|
10.15
‡
|
|
|
|
10.16†
|
|
|
|
10.17†
|
|
|
|
10.18†
|
|
|
|
10.19†
|
|
|
|
10.20†
|
|
|
|
10.21†
|
|
|
|
10.22†
|
|
|
|
10.23
|
|
|
|
10.24*
|
|
|
|
10.25*
|
|
|
|
21.1
|
|
|
|
23.1
|
|
|
|
24
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
32.1 **
|
|
|
|
32.2 **
|
|
|
|
101.INS
|
|
|
XBRL Instance Document
|
101.SCH
|
|
|
XBRL Schema Document
|
Exhibit No.
|
|
Description
|
|
101.CAL
|
|
|
XBRL Calculation Linkbase Document
|
101.DEF
|
|
|
XBRL Taxonomy Extension Definition Linkbase
|
101.LAB
|
|
|
XBRL Labels Linkbase Document
|
101.PRE
|
|
|
XBRL Presentation Linkbase Document
|
†
|
Compensation Arrangement.
|
*
|
Confidential treatment has been requested for portions of this document. The omitted portions of this document have been filed with the Securities and Exchange Commission.
|
‡
|
Confidential treatment has been granted with respect to certain provisions of this exhibit.
|
**
|
This certification is being furnished solely to accompany this Annual Report pursuant to 18 U.S.C. Section 1350, and are not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and are not to be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
|
(b)
|
Exhibits.
|
(c)
|
Financial Statement Schedule.
|
|
|
Beginning
|
|
|
|
|
|
Ending
|
||||||||
|
|
Balance
|
|
Additions
|
|
Reductions
|
|
Balance
|
||||||||
|
|
(In thousands)
|
||||||||||||||
Allowance for doubtful receivables
|
|
|
|
|
|
|
|
|
||||||||
2017
|
|
$
|
1,459
|
|
|
$
|
7,590
|
|
|
$
|
(5,942
|
)
|
|
$
|
3,107
|
|
2016
(As Restated)
|
|
$
|
1,189
|
|
|
$
|
10,201
|
|
|
$
|
(9,931
|
)
|
|
$
|
1,459
|
|
2015
(As Restated)
|
|
$
|
88
|
|
|
$
|
2,032
|
|
|
$
|
(931
|
)
|
|
$
|
1,189
|
|
|
|
Beginning
|
|
|
|
|
|
Ending
|
||||||||
|
|
Balance
|
|
Additions
|
|
Reductions
|
|
Balance
|
||||||||
|
|
(In thousands)
|
||||||||||||||
Allowance for loan loss
|
|
|
|
|
|
|
|
|
||||||||
2017
|
|
$
|
—
|
|
|
$
|
14,562
|
|
|
$
|
—
|
|
|
$
|
14,562
|
|
|
|
Beginning
|
|
|
|
|
|
Ending
|
||||||||
|
|
Balance
|
|
Additions
|
|
Reductions
|
|
Balance
|
||||||||
|
|
(In thousands)
|
||||||||||||||
Valuation allowance for deferred tax assets
|
|
|
|
|
|
|
|
|
||||||||
2017
|
|
$
|
14,180
|
|
|
$
|
23,370
|
|
|
$
|
(5,027
|
)
|
|
$
|
32,523
|
|
2016
(As Restated)
|
|
$
|
10,804
|
|
|
$
|
3,783
|
|
|
$
|
(407
|
)
|
|
$
|
14,180
|
|
2015
(As Restated)
|
|
$
|
4,764
|
|
|
$
|
7,248
|
|
|
$
|
(1,208
|
)
|
|
$
|
10,804
|
|
|
SYNCHRONOSS TECHNOLOGIES, INC.
(Registrant)
|
|
|
|
|
|
By
|
/s/ Glenn Lurie
|
|
|
Glenn Lurie, Chief Executive Officer
|
|
|
(1)
|
Registration Statement (Form S‑8 No. 333‑136088) pertaining to the 2006 Equity Incentive Plan,
|
(2)
|
Registration Statement (Form S‑3 No. 333‑164619) of Synchronoss Technologies, Inc.,
|
(3)
|
Registration Statement (Form S‑8 No. 333‑167000) pertaining to the 2006 Equity Incentive Plan,
|
(4)
|
Registration Statement (Form S‑8 No. 333‑168745) pertaining to the 2010 New Hire Equity Incentive Plan,
|
(5)
|
Registration Statement (Form S‑8 No. 333‑179544) pertaining to the Employee Stock Purchase Plan,
|
(6)
|
Registration Statement (Form S‑8 No. 333‑188939) pertaining to the 2006 Equity Incentive Plan;
|
(7)
|
Registration Statement (Form S‑3 No. 333‑197871) of Synchronoss Technologies, Inc.; and
|
(8)
|
Registration Statement (Form S-8 No. 333-204311) pertaining to the 2015 Equity Incentive Plan
|
1.
|
I have reviewed this Quarterly Report on Form 10-K of Synchronoss Technologies, Inc. for the year ended
December 31, 2017
;
|
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 Rule 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 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/ Glenn Lurie
|
|
Glenn Lurie
|
|
Chief Executive Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-K of Synchronoss Technologies, Inc. for the year ended
December 31, 2017
;
|
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 Rule 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 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/ Lawrence R. Irving
|
|
Lawrence R. Irving
|
|
Chief Financial Officer
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
/s/ Glenn Lurie
|
|
Glenn Lurie
|
|
Principal Executive Officer & Director
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
/s/ Lawrence R. Irving
|
|
Lawrence R. Irving
|
|
Chief Financial Officer
|