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☑
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO
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Delaware
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54-1955550
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(State or Other Jurisdiction of Incorporation or Organization)
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(I.R.S. Employer Identification Number)
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Title of Each Class
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Trading Symbol
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Name of Each Exchange on Which Registered
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Common Stock, par value $0.001 per share
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SCOR
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NASDAQ Global Select Market
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Large accelerated filer
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☐
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Accelerated filer
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☑
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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Item 16.
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ITEM 1.
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BUSINESS
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•
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We collect data from proprietary consumer panels that measure the use of computers, tablets and smartphones that access the internet. These panelists have agreed to install our passive metering software on their devices, home network or both.
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•
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We collect data from our near-census digital network whereby content publishers implement our software code (referred to as "tagging") on their websites, in mobile applications and video players to provide us usage information.
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•
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We license certain demographic and behavioral mobile and panel data from third-party data providers.
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•
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We obtain U.S. television viewership information from satellite, telecommunications and cable operators covering millions of television and VOD screens.
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•
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We measure gross receipts and attendance information from movie screens across the world.
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•
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We integrate our digital and television viewership information with other third-party datasets that include consumer demographic characteristics, attitudes, lifestyles and purchase behavior.
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•
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We integrate many of our services with ad serving platforms.
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•
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We utilize knowledgeable in-house industry analysts that span verticals such as pharmaceuticals, media, finance, consumer packaged goods and political information to add value to our data.
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•
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We have created an opt-in Total Home Panel, which can capture data that runs through a home's internet connection. This expands our intelligence to include such activity as game console and IOT device usage.
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•
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Our UDM methodology, which allows us to combine person-centric panel data with website server data. We believe this gives our customers greater accuracy, granularity and relevance in audience measurement.
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•
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An ability to de-duplicate audiences across platforms, which is based on direct observations within our consumer panel and census data combined with proprietary data science. This de-duplication allows us to measure the reach and frequency of advertising and content exposure across platforms and over time.
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•
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An ability to validate advertising delivery and detect fraud through our Invalid Traffic and Sophisticated Invalid Traffic filtration methods. These methods have been accredited by the Media Rating Council, which provides our customers with added assurances of validity and reliability.
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•
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An ability to capture the full content of a website or app session, which allows us to measure activity beyond page views such as purchase transactions, application submissions and product configurations.
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•
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An ability to intelligently categorize massive amounts of web content, which allows us to inform targeted and brand-safe advertising.
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•
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Local and national television broadcasters and content owners;
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•
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Network operators including cable companies, mobile operators and internet service providers;
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•
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Digital content publishers and internet technology companies;
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•
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Advertising agencies;
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•
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Movie studios and movie theater operators;
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•
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Financial service companies, including buy and sell-side investment firms, consumer banks and credit card issuers;
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•
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Manufacturers and retailers of consumer products such as consumer packaged goods, pharmaceuticals, automotive and electronics; and
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•
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Political campaigns and related organizations.
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•
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Ratings and Planning products and services that provide measurement of the behavior and characteristics of audiences of content and advertising, across television and digital platforms including computers, tablets, smartphones, and other connected devices;
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•
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Analytics and Optimization products and services including custom solutions, activation, lift and survey-based products, that provide end-to-end solutions for planning, optimization and evaluation of advertising campaigns and brand protection; and
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•
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Movies Reporting and Analytics products and services that measure movie viewership and box office results by capturing movie ticket sales in real time or near real time and include box office analytics, trend analysis and insights for movie studios and movie theater operators worldwide.
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•
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Media Metrix and Mobile Metrix, which measure websites and apps on computers, smartphones and tablets across dozens of countries, are leading currencies for online media planning and enable customers to analyze audience size, reach, engagement, demographics and other characteristics. Publishers use Media Metrix and Mobile Metrix to demonstrate the value of their audiences and understand market dynamics, and advertisers and their agencies use Media and Mobile Metrix to plan and execute effective marketing and content campaigns. These products also provide competitive intelligence such as cross-site visiting patterns, traffic source/loss reporting and local market trends.
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•
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Video Metrix, which delivers unduplicated measurement of digital video consumption across computer, smartphone, tablet and OTT devices and provides TV-comparable reach and engagement metrics, as well as audience demographics.
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•
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Plan Metrix, which provides an understanding of consumer lifestyle, buying and other consumption habits, online and offline, by integrating attitudes and interests with online behavior and provides customers with insight into patterns and trends needed to develop and execute advertising and marketing campaigns.
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•
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TV Essentials, which combines TV viewing information with marketing segmentation and consumer databases for enhanced audience intelligence. TV Essentials data is also used in analytical applications to help customers better understand the performance of network advertising campaigns.
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•
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StationView Essentials, which allows customers to better understand consumer viewing patterns and characteristics across local TV stations and cable channels in their market(s) to promote viewership of a particular station and negotiate inventory pricing based on the size, value and relevance of the audience.
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•
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Cross-Platform Suite, including XMedia and Extended TV (currently in development), which provides the integration of person-level linear TV viewership with digital audience data and enables the creation of cross-platform media plans based on an analysis of de-duplicated reach, engagement and audience overlap across TV and digital platforms using a self-service tool. Customers can simulate cross-platform media planning and share scenarios, understand incremental reach and frequency that digital provides compared to that of linear TV media buys, and simulate various media-mix scenarios to better understand the optimal mix.
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•
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OnDemand Essentials, which provides multichannel video programming distributors and content providers with transactional tracking and reporting based on millions of television screens, enabling our customers to plan advertising campaigns that more precisely target consumers watching on-demand video content.
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•
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Comscore Campaign Ratings ("CCR"), which expands upon validated Campaign Essentials ("vCE") verification of mobile and desktop video campaigns with the addition of video advertising delivered via OTT and TV and provides unduplicated reporting that enables ad buyers and sellers to negotiate and evaluate campaigns across media platforms.
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•
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vCE, which validates whether digital ad impressions are visible to humans, identifies those that are fraudulent (e.g., delivered to automated bots or requested by malware), and verifies that ads are shown in brand safe content and delivered to the right audience targets. Advertisers and their agencies use vCE as the basis for negotiating and evaluating campaign performance against their contracts with, and payments to, digital publishers for ad campaigns.
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•
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Comscore Marketing Solutions, which provide analytics that integrate online visitation and advertising data, TV viewing, purchase transactions, attitudinal research and other Comscore information assets. These custom deliverables are designed to meet client needs in specific industries such as automotive, financial services, media, retail, travel, telecommunications and technology. Applications include path-to-purchase analyses, competitive benchmarking, and market segmentation studies.
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•
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Lift Models, which measure the impact of advertising on a brand across multiple behavioral and attitudinal dimensions such as brand awareness, purchase intent, online visitation, online and offline purchase behavior and retail store visitation, enabling customers to fine tune campaign strategy and execution.
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•
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Survey Analytics, which measure various types of consumer insights including brand health metrics.
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•
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Activation Solutions, which use Comscore-collected data about media characteristics and consumption to help our clients enhance their customer interactions, enable clients to ensure that their advertisements appear only in brand-safe, relevant environments, or enrich client databases for use in advanced analytic and media planning applications.
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•
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Branded Content Analytics, which measure the impact and value of brand integrations into content such as TV programs.
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•
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Box Office Essentials, which provides detailed measurement of domestic and international theatrical gross receipts and attendance, with movie-specific information across the globe.
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•
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Box Office Analytics, which provides release-date optimization using predictive analytics to estimate the gross revenue potential for future films, long-lead measurement to help gauge the health of a movie's marketing campaign before theatrical release, and post-release reports of audience demographics and the aspects of each movie that trigger interest and attendance.
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•
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Swift, which is an electronic box office reporting system that facilitates the flow of reconciled theater-level ticket transactions.
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•
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Hollywood Software, which provides movie theater distributors and exhibitors with software and infrastructure to manage and control end-to-end processes and equipment for digital cinema exhibition and enables customers to plan releases, program theater screens, and manage payments across multiple theaters.
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•
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Enhancing our recruiting methods and software applications;
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•
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Developing new technologies to manage, stage and deliver cross-platform data and analytics through traditional web-based user interfaces and via integration with customer systems;
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•
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Creating new methodologies to measure person-level TV and digital consumption at scale and across platforms; and
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•
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Continuing to develop expertise in combining our data assets with those of partner companies, which allows us to enhance existing services and create new audience rating products and insight into audience behavior.
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•
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Data Collection - metering such as biometrics and audio fingerprinting, tagging such as video viewability, browser optimization, IP obfuscation and TV-off measurement methodology.
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•
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Data Processing - traffic and content categorization, demographic attribution, ad effectiveness measurement, data overlap and fusion, invalid traffic detection, data weighting, projection and processing of return path data.
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Full-service market research firms, including Nielsen, Ipsos and GfK;
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Companies that provide audience ratings for TV, radio and other media that have extended or may extend their current services, particularly in certain international markets, to the measurement of digital media, including Nielsen Audio (formerly Arbitron) and TiVo Corporation;
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•
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Online advertising companies that provide measurement of online ad effectiveness and ad delivery used for billing purposes, including Nielsen, Google and Facebook;
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Companies that provide digital advertising technology point solutions, including DoubleVerify, Integral Ad Science, Moat (owned by Oracle), and WhiteOps;
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•
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Companies that provide audience measurement and competitive intelligence across digital platforms, including Nielsen, SimilarWeb, and App Annie;
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•
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Analytical services companies that provide customers with detailed information about behavior on their own websites, including Adobe Analytics, IBM Digital Analytics and WebTrends Inc.;
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•
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Companies that report Smart TV data such as Vizio, Alphonso, and Samba TV; and
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•
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Companies that provide consumers with TV and digital services such as AT&T and Comcast.
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•
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The ability to provide accurate measurement of digital audiences across multiple digital platforms;
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•
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The ability to provide TV audience measurement based on near-census data that increases accuracy and reduces variability;
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•
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The ability to provide de-duplicated audience measurement across platforms;
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•
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The ability to provide actual, accurate and reliable data regarding audience behavior and activity in a timely manner, including the ability to maintain large and statistically representative panels;
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•
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The ability to provide reliable and objective third-party data that, as needed, is able to receive industry-accepted accreditation;
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•
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The ability to adapt product offerings to emerging digital media technologies and standards;
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•
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The breadth and depth of products and their flexibility and ease of use;
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•
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The availability of data across various industry verticals and geographic areas and expertise across these verticals and in these geographic areas; and
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•
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The ability to offer products that meet the changing needs of customers, particularly in the evolving privacy environment.
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ITEM 1A.
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RISK FACTORS
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the reliability of cross-platform products;
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decisions of our customers and potential customers to develop cross-platform solutions internally rather than purchasing such products from third-party suppliers like us;
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•
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decisions by industry associations in the U.S. or in other countries that result in association-directed awards of measurement contracts to one or a limited number of competitive vendors;
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the rate of growth in e-commerce and mobile commerce, cross-platform focused advertising and continued growth in television and digital media consumption; and
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public and regulatory concern regarding privacy and data security.
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•
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loss of customers;
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sales credits, refunds or liability to our customers;
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•
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the incurrence of substantial costs to correct any material defect, error or inconsistency;
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•
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increased warranty and insurance costs;
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potential litigation;
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•
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interruptions in the availability of our products;
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•
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diversion of development resources;
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•
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lost or delayed market acceptance and sales of our products; and
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•
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damage to our brand.
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•
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encounter difficulties retaining key employees of the acquired company or integrating diverse business cultures;
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incur large charges or substantial liabilities, including without limitation, liabilities associated with products or technologies accused or found to infringe on third-party intellectual property rights or violate existing or future privacy regulations;
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•
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issue shares of our capital stock as part of the consideration, which may be dilutive to existing stockholders;
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become subject to adverse tax consequences, legal disputes, substantial depreciation or deferred compensation charges;
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•
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use cash that we may otherwise need for ongoing or future operation of our business;
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•
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enter new geographic markets that subject us to different laws and regulations that may have an adverse impact on our business;
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•
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experience difficulties effectively utilizing acquired assets;
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•
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encounter difficulties integrating the information and financial reporting systems of acquired businesses, particularly those that operated under accounting principles other than those generally accepted in the U.S. prior to the acquisition by us; and
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•
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incur debt, which may be on terms unfavorable to us or that we are unable to repay.
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•
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our ability to increase sales to existing customers and attract new customers;
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•
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the potential loss or reduction in spending by significant customers;
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•
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changes in our customers' subscription renewal behaviors and spending on projects;
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•
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the impact of our contract renewal rates caused by our customers' budgetary constraints, competition, customer dissatisfaction, customer corporate restructuring or change in control, or our customers' actual or perceived lack of need for our products;
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•
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the timing of contract renewals, delivery of products and duration of contracts and the corresponding timing of revenue recognition;
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•
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variations in the demand for our products and the implementation cycles of our products by our customers;
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•
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the challenges of persuading existing and prospective customers to switch from incumbent service providers;
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•
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the timing of revenue recognition for usage-based or impression-based products;
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•
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the effect of revenues generated from significant one-time projects or the loss of such projects;
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•
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the timing and success of new product introductions by us or our competitors;
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•
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changes in our pricing and discounting policies or those of our competitors;
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•
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the impact of our decision to discontinue certain products;
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•
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our failure to accurately estimate or control costs - including those incurred as a result of investments, other business or product development initiatives, legal proceedings, and the integration of acquired businesses;
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•
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the cost and availability of data from third-party sources;
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•
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adverse judgments or settlements, or increased legal fees, in legal disputes or government proceedings;
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•
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changes in interest rates under our senior secured convertible notes or other financing vehicles;
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•
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the amount and timing of capital expenditures and operating costs related to the maintenance and expansion of our operations and infrastructure;
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•
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service outages, other technical difficulties or security breaches;
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•
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limitations relating to the capacity of our networks, systems and processes;
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•
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maintaining appropriate staffing levels and capabilities relative to projected growth, or retaining key personnel;
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•
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limitations on our ability to use equity awards to compensate current and prospective employees;
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•
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the cost and timing of organizational restructuring;
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•
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the risks associated with operating in countries in which we may have little or no previous experience and with maintaining or reorganizing corporate entity structures in international jurisdictions;
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•
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the extent to which certain expenses are deductible for tax purposes, such as share-based compensation that fluctuates based on the timing of vesting and our stock price;
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•
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the timing of any changes to our deferred tax valuation allowance;
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•
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adoption of new accounting pronouncements;
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•
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changes in the fair value of our financing derivatives and warrants related to market volatility or management assumptions; and
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•
|
general economic, political, regulatory, industry and market conditions and those conditions specific to internet usage and online businesses.
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•
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recruitment and maintenance of a sufficiently large and representative panel both globally and in certain countries;
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•
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difficulties and expenses associated with tailoring our products to local and international markets as may be required by local customers and joint industry committees or similar industry organizations;
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•
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difficulties in expanding the adoption of our server- or census-based web beacon data collection in certain countries or obtaining access to other necessary data sources;
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•
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differences in customer buying behaviors;
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•
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the complexities and expense of complying with a wide variety of foreign laws and regulations, including the GDPR, LGPD, other privacy and data protection laws and regulations, and foreign anti-corruption laws, as well as the U.S. Foreign Corrupt Practices Act;
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•
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difficulties in staffing and managing international operations, including complex and costly hiring, disciplinary, and termination requirements;
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•
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the complexities of foreign value-added taxes and the repatriation of earnings, particularly following the enactment of the TCJA;
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•
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reduced or varied protection for intellectual property rights in some countries;
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•
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political, social and economic instability abroad, terrorist attacks and security concerns;
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•
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fluctuations in currency exchange rates; and
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•
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increased accounting and reporting burdens and complexities.
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•
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provide for a classified board of directors so that not all members of our Board are elected at one time;
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•
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authorize "blank check" preferred stock that our Board could issue to increase the number of outstanding shares to discourage a takeover attempt;
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•
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prohibit stockholder action by written consent, which means that all stockholder actions must be taken at a meeting of our stockholders;
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•
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prohibit stockholders from calling a special meeting of our stockholders;
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•
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provide that the Board is expressly authorized to make, alter or repeal our bylaws; and
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•
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provide for advance notice requirements for nominations for elections to our Board or for proposing matters that can be acted upon by stockholders at stockholder meetings.
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ITEM 1B.
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UNRESOLVED STAFF COMMENTS
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ITEM 2.
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PROPERTIES
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ITEM 3.
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LEGAL PROCEEDINGS
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ITEM 4.
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MINE SAFETY DISCLOSURES
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ITEM 5.
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MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
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*
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$100 invested upon market close of The Nasdaq Global Select Market on December 31, 2014, including reinvestment of dividends.
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ITEM 6.
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SELECTED FINANCIAL DATA
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|
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As of December 31,
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||||||||||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
|
2016(1)
|
|
2015
(Unaudited)
|
||||||||||
Consolidated Balance Sheets Data:
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|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents, restricted cash and marketable securities
|
|
$
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66,773
|
|
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$
|
50,198
|
|
|
$
|
45,125
|
|
|
$
|
116,753
|
|
|
$
|
146,986
|
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Total current assets
|
|
153,983
|
|
|
145,779
|
|
|
179,554
|
|
|
232,433
|
|
|
247,263
|
|
|||||
Total assets
|
|
723,695
|
|
|
954,143
|
|
|
1,022,439
|
|
|
1,120,792
|
|
|
446,196
|
|
|||||
Capital lease obligations and software license arrangements, current and long-term (2) (3)
|
|
950
|
|
|
5,417
|
|
|
13,162
|
|
|
28,578
|
|
|
32,299
|
|
|||||
Finance lease liabilities, current and long-term (3)
|
|
4,250
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating lease liabilities, current and long-term (3)
|
|
49,261
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Senior secured convertible notes (4)
|
|
184,075
|
|
|
177,342
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Financing derivatives (4)
|
|
21,587
|
|
|
26,100
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Secured term note (5)
|
|
12,463
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Warrants liability (6)
|
|
7,725
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total liabilities
|
|
464,721
|
|
|
402,576
|
|
|
365,947
|
|
|
215,939
|
|
|
184,018
|
|
|||||
Stockholders' equity
|
|
258,974
|
|
|
551,567
|
|
|
656,492
|
|
|
904,853
|
|
|
262,178
|
|
|
|
Years Ended December 31,
|
|||||||||||||||||||
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
(In thousands)
|
|
Dollars
|
|
% of Revenue
|
|
Dollars
|
|
% of Revenue
|
|
Dollars
|
|
% of Revenue
|
|||||||||
Revenues
|
|
$
|
388,645
|
|
|
100.0
|
%
|
|
$
|
419,482
|
|
|
100.0
|
%
|
|
$
|
403,549
|
|
|
100.0
|
%
|
Cost of revenues
|
|
199,622
|
|
|
51.4
|
%
|
|
200,220
|
|
|
47.7
|
%
|
|
193,605
|
|
|
48.0
|
%
|
|||
Selling and marketing
|
|
89,145
|
|
|
22.9
|
%
|
|
108,395
|
|
|
25.8
|
%
|
|
130,509
|
|
|
32.3
|
%
|
|||
Research and development
|
|
61,802
|
|
|
15.9
|
%
|
|
76,979
|
|
|
18.4
|
%
|
|
89,023
|
|
|
22.1
|
%
|
|||
General and administrative
|
|
66,419
|
|
|
17.1
|
%
|
|
84,535
|
|
|
20.2
|
%
|
|
74,651
|
|
|
18.5
|
%
|
|||
Investigation and audit related
|
|
4,305
|
|
|
1.1
|
%
|
|
38,338
|
|
|
9.1
|
%
|
|
83,398
|
|
|
20.7
|
%
|
|||
Amortization of intangible assets
|
|
30,076
|
|
|
7.7
|
%
|
|
32,864
|
|
|
7.8
|
%
|
|
34,823
|
|
|
8.6
|
%
|
|||
Impairment of goodwill and intangible assets
|
|
241,580
|
|
|
62.2
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Settlement of litigation, net
|
|
2,900
|
|
|
0.7
|
%
|
|
5,250
|
|
|
1.3
|
%
|
|
82,533
|
|
|
20.5
|
%
|
|||
Restructuring
|
|
3,263
|
|
|
0.8
|
%
|
|
11,837
|
|
|
2.8
|
%
|
|
10,510
|
|
|
2.6
|
%
|
|||
Total expenses from operations
|
|
699,112
|
|
|
179.9
|
%
|
|
558,418
|
|
|
133.1
|
%
|
|
699,052
|
|
|
173.2
|
%
|
|||
Loss from operations
|
|
(310,467
|
)
|
|
(79.9
|
)%
|
|
(138,936
|
)
|
|
(33.1
|
)%
|
|
(295,503
|
)
|
|
(73.2
|
)%
|
|||
Interest expense, net
|
|
(31,526
|
)
|
|
(8.1
|
)%
|
|
(16,465
|
)
|
|
(3.9
|
)%
|
|
(661
|
)
|
|
(0.2
|
)%
|
|||
Other income (expense), net
|
|
1,654
|
|
|
0.4
|
%
|
|
(1,464
|
)
|
|
(0.3
|
)%
|
|
15,205
|
|
|
3.8
|
%
|
|||
Gain (loss) from foreign currency transactions
|
|
336
|
|
|
0.1
|
%
|
|
1,303
|
|
|
0.3
|
%
|
|
(3,151
|
)
|
|
(0.8
|
)%
|
|||
Loss before income taxes
|
|
(340,003
|
)
|
|
(87.5
|
)%
|
|
(155,562
|
)
|
|
(37.1
|
)%
|
|
(284,110
|
)
|
|
(70.4
|
)%
|
|||
Income tax benefit (provision)
|
|
1,007
|
|
|
0.3
|
%
|
|
(3,706
|
)
|
|
(0.9
|
)%
|
|
2,717
|
|
|
0.7
|
%
|
|||
Net loss
|
|
$
|
(338,996
|
)
|
|
(87.2
|
)%
|
|
$
|
(159,268
|
)
|
|
(38.0
|
)%
|
|
$
|
(281,393
|
)
|
|
(69.7
|
)%
|
•
|
Ratings and Planning provides measurement of the behavior and characteristics of audiences of content and advertising, across television and digital platforms including computers, tablets, smartphones, and other connected devices. These products and services are designed to help customers find the most relevant viewing audience, whether that viewing is linear, non-linear, online or on-demand.
|
•
|
Analytics and Optimization includes custom solutions, activation, lift and survey-based products that provide end-to-end solutions for planning, optimization and evaluation of advertising campaigns and brand protection.
|
•
|
Movies Reporting and Analytics measures movie viewership and box office results by capturing movie ticket sales in real time or near real time and includes box office analytics, trend analysis and insights for movie studios and movie theater operators worldwide.
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Ratings and Planning
|
$
|
271,623
|
|
|
69.9
|
%
|
|
$
|
285,355
|
|
|
68.0
|
%
|
|
$
|
(13,732
|
)
|
|
(4.8
|
)%
|
Analytics and Optimization
|
74,725
|
|
|
19.2
|
%
|
|
92,380
|
|
|
22.0
|
%
|
|
(17,655
|
)
|
|
(19.1
|
)%
|
|||
Movies Reporting and Analytics
|
42,297
|
|
|
10.9
|
%
|
|
41,747
|
|
|
10.0
|
%
|
|
550
|
|
|
1.3
|
%
|
|||
Total revenues
|
$
|
388,645
|
|
|
100.0
|
%
|
|
$
|
419,482
|
|
|
100.0
|
%
|
|
$
|
(30,837
|
)
|
|
(7.4
|
)%
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2018(1)
|
|
% of Revenue
|
|
2017
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Ratings and Planning
|
$
|
285,355
|
|
|
68.0
|
%
|
|
$
|
278,081
|
|
|
68.9
|
%
|
|
$
|
7,274
|
|
|
2.6
|
%
|
Analytics and Optimization
|
92,380
|
|
|
22.0
|
%
|
|
86,765
|
|
|
21.5
|
%
|
|
5,615
|
|
|
6.5
|
%
|
|||
Movies Reporting and Analytics
|
41,747
|
|
|
10.0
|
%
|
|
38,703
|
|
|
9.6
|
%
|
|
3,044
|
|
|
7.9
|
%
|
|||
Total revenues
|
$
|
419,482
|
|
|
100.0
|
%
|
|
$
|
403,549
|
|
|
100.0
|
%
|
|
$
|
15,933
|
|
|
3.9
|
%
|
|
Years Ended December 31,
|
|
|
|||||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Data costs
|
$
|
60,165
|
|
|
15.5
|
%
|
|
$
|
53,248
|
|
|
12.7
|
%
|
|
$
|
6,917
|
|
|
13.0
|
%
|
Employee costs
|
50,996
|
|
|
13.1
|
%
|
|
57,490
|
|
|
13.7
|
%
|
|
(6,494
|
)
|
|
(11.3
|
)%
|
|||
Systems and bandwidth costs
|
25,023
|
|
|
6.4
|
%
|
|
27,033
|
|
|
6.4
|
%
|
|
(2,010
|
)
|
|
(7.4
|
)%
|
|||
Panel costs
|
20,901
|
|
|
5.4
|
%
|
|
22,670
|
|
|
5.4
|
%
|
|
(1,769
|
)
|
|
(7.8
|
)%
|
|||
Lease expense and depreciation(1)
|
15,052
|
|
|
3.9
|
%
|
|
12,753
|
|
|
3.0
|
%
|
|
2,299
|
|
|
18.0
|
%
|
|||
Sample and survey costs
|
7,225
|
|
|
1.9
|
%
|
|
6,295
|
|
|
1.5
|
%
|
|
930
|
|
|
14.8
|
%
|
|||
Professional fees
|
6,985
|
|
|
1.8
|
%
|
|
5,470
|
|
|
1.3
|
%
|
|
1,515
|
|
|
27.7
|
%
|
|||
Technology
|
5,887
|
|
|
1.5
|
%
|
|
6,492
|
|
|
1.5
|
%
|
|
(605
|
)
|
|
(9.3
|
)%
|
|||
Royalties and resellers
|
4,027
|
|
|
1.0
|
%
|
|
3,389
|
|
|
0.8
|
%
|
|
638
|
|
|
18.8
|
%
|
|||
Other
|
3,361
|
|
|
0.9
|
%
|
|
5,380
|
|
|
1.3
|
%
|
|
(2,019
|
)
|
|
(37.5
|
)%
|
|||
Total cost of revenues
|
$
|
199,622
|
|
|
51.4
|
%
|
|
$
|
200,220
|
|
|
47.7
|
%
|
|
$
|
(598
|
)
|
|
(0.3
|
)%
|
|
Years Ended December 31,
|
|
|
|||||||||||||||||
(In thousands)
|
2018
|
|
% of Revenue
|
|
2017
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
57,490
|
|
|
13.7
|
%
|
|
$
|
63,143
|
|
|
15.6
|
%
|
|
$
|
(5,653
|
)
|
|
(9.0
|
)%
|
Data costs
|
53,248
|
|
|
12.7
|
%
|
|
40,324
|
|
|
10.0
|
%
|
|
12,924
|
|
|
32.1
|
%
|
|||
Systems and bandwidth costs
|
27,033
|
|
|
6.4
|
%
|
|
20,803
|
|
|
5.2
|
%
|
|
6,230
|
|
|
29.9
|
%
|
|||
Panel costs
|
22,670
|
|
|
5.4
|
%
|
|
23,966
|
|
|
5.9
|
%
|
|
(1,296
|
)
|
|
(5.4
|
)%
|
|||
Lease expense and depreciation
|
12,753
|
|
|
3.0
|
%
|
|
17,479
|
|
|
4.3
|
%
|
|
(4,726
|
)
|
|
(27.0
|
)%
|
|||
Technology
|
6,492
|
|
|
1.5
|
%
|
|
5,369
|
|
|
1.3
|
%
|
|
1,123
|
|
|
20.9
|
%
|
|||
Sample and survey costs
|
6,295
|
|
|
1.5
|
%
|
|
5,845
|
|
|
1.4
|
%
|
|
450
|
|
|
7.7
|
%
|
|||
Professional fees
|
5,470
|
|
|
1.3
|
%
|
|
6,053
|
|
|
1.5
|
%
|
|
(583
|
)
|
|
(9.6
|
)%
|
|||
Royalties and resellers
|
3,389
|
|
|
0.8
|
%
|
|
3,271
|
|
|
0.8
|
%
|
|
118
|
|
|
3.6
|
%
|
|||
Other
|
5,380
|
|
|
1.3
|
%
|
|
7,352
|
|
|
1.8
|
%
|
|
(1,972
|
)
|
|
(26.8
|
)%
|
|||
Total cost of revenues
|
$
|
200,220
|
|
|
47.7
|
%
|
|
$
|
193,605
|
|
|
48.0
|
%
|
|
$
|
6,615
|
|
|
3.4
|
%
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
71,979
|
|
|
18.5
|
%
|
|
$
|
87,591
|
|
|
20.9
|
%
|
|
$
|
(15,612
|
)
|
|
(17.8
|
)%
|
Lease expense and depreciation(1)
|
5,690
|
|
|
1.5
|
%
|
|
7,670
|
|
|
1.8
|
%
|
|
(1,980
|
)
|
|
(25.8
|
)%
|
|||
Travel
|
3,260
|
|
|
0.8
|
%
|
|
4,780
|
|
|
1.1
|
%
|
|
(1,520
|
)
|
|
(31.8
|
)%
|
|||
Technology
|
2,726
|
|
|
0.7
|
%
|
|
1,042
|
|
|
0.2
|
%
|
|
1,684
|
|
|
161.6
|
%
|
|||
Professional fees
|
2,521
|
|
|
0.6
|
%
|
|
3,311
|
|
|
0.8
|
%
|
|
(790
|
)
|
|
(23.9
|
)%
|
|||
Other
|
2,969
|
|
|
0.8
|
%
|
|
4,001
|
|
|
1.0
|
%
|
|
(1,032
|
)
|
|
(25.8
|
)%
|
|||
Total selling and marketing expenses
|
$
|
89,145
|
|
|
22.9
|
%
|
|
$
|
108,395
|
|
|
25.8
|
%
|
|
$
|
(19,250
|
)
|
|
(17.8
|
)%
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2018
|
|
% of Revenue
|
|
2017
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
87,591
|
|
|
20.9
|
%
|
|
$
|
100,236
|
|
|
24.8
|
%
|
|
$
|
(12,645
|
)
|
|
(12.6
|
)%
|
Lease expense and depreciation
|
7,670
|
|
|
1.8
|
%
|
|
10,304
|
|
|
2.6
|
%
|
|
(2,634
|
)
|
|
(25.6
|
)%
|
|||
Travel
|
4,780
|
|
|
1.1
|
%
|
|
6,926
|
|
|
1.7
|
%
|
|
(2,146
|
)
|
|
(31.0
|
)%
|
|||
Professional fees
|
3,311
|
|
|
0.8
|
%
|
|
6,551
|
|
|
1.6
|
%
|
|
(3,240
|
)
|
|
(49.5
|
)%
|
|||
Other
|
5,043
|
|
|
1.2
|
%
|
|
6,492
|
|
|
1.6
|
%
|
|
(1,449
|
)
|
|
(22.3
|
)%
|
|||
Total selling and marketing expenses
|
$
|
108,395
|
|
|
25.8
|
%
|
|
$
|
130,509
|
|
|
32.3
|
%
|
|
$
|
(22,114
|
)
|
|
(16.9
|
)%
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
47,626
|
|
|
12.3
|
%
|
|
$
|
60,490
|
|
|
14.4
|
%
|
|
$
|
(12,864
|
)
|
|
(21.3
|
)%
|
Lease expense and depreciation(1)
|
5,958
|
|
|
1.5
|
%
|
|
7,057
|
|
|
1.7
|
%
|
|
(1,099
|
)
|
|
(15.6
|
)%
|
|||
Technology
|
4,164
|
|
|
1.1
|
%
|
|
5,057
|
|
|
1.2
|
%
|
|
(893
|
)
|
|
(17.7
|
)%
|
|||
Professional fees
|
2,860
|
|
|
0.7
|
%
|
|
2,668
|
|
|
0.6
|
%
|
|
192
|
|
|
7.2
|
%
|
|||
Other
|
1,194
|
|
|
0.3
|
%
|
|
1,707
|
|
|
0.4
|
%
|
|
(513
|
)
|
|
(30.1
|
)%
|
|||
Total research and development expenses
|
$
|
61,802
|
|
|
15.9
|
%
|
|
$
|
76,979
|
|
|
18.4
|
%
|
|
$
|
(15,177
|
)
|
|
(19.7
|
)%
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2018
|
|
% of Revenue
|
|
2017
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
60,490
|
|
|
14.4
|
%
|
|
$
|
71,527
|
|
|
17.7
|
%
|
|
$
|
(11,037
|
)
|
|
(15.4
|
)%
|
Lease expense and depreciation
|
7,057
|
|
|
1.7
|
%
|
|
7,729
|
|
|
1.9
|
%
|
|
(672
|
)
|
|
(8.7
|
)%
|
|||
Technology
|
5,057
|
|
|
1.2
|
%
|
|
4,736
|
|
|
1.2
|
%
|
|
321
|
|
|
6.8
|
%
|
|||
Professional fees
|
2,668
|
|
|
0.6
|
%
|
|
2,351
|
|
|
0.6
|
%
|
|
317
|
|
|
13.5
|
%
|
|||
Other
|
1,707
|
|
|
0.4
|
%
|
|
2,680
|
|
|
0.7
|
%
|
|
(973
|
)
|
|
(36.3
|
)%
|
|||
Total research and development expenses
|
$
|
76,979
|
|
|
18.4
|
%
|
|
$
|
89,023
|
|
|
22.1
|
%
|
|
$
|
(12,044
|
)
|
|
(13.5
|
)%
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2019
|
|
% of Revenue
|
|
2018
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
34,435
|
|
|
8.9
|
%
|
|
$
|
38,094
|
|
|
9.1
|
%
|
|
$
|
(3,659
|
)
|
|
(9.6
|
)%
|
Professional fees
|
18,385
|
|
|
4.7
|
%
|
|
21,528
|
|
|
5.1
|
%
|
|
(3,143
|
)
|
|
(14.6
|
)%
|
|||
Lease expense and depreciation(1)
|
2,491
|
|
|
0.6
|
%
|
|
3,711
|
|
|
0.9
|
%
|
|
(1,220
|
)
|
|
(32.9
|
)%
|
|||
Bad debt expense
|
727
|
|
|
0.2
|
%
|
|
966
|
|
|
0.2
|
%
|
|
(239
|
)
|
|
(24.7
|
)%
|
|||
Transition services agreement
|
667
|
|
|
0.2
|
%
|
|
9,035
|
|
|
2.2
|
%
|
|
(8,368
|
)
|
|
(92.6
|
)%
|
|||
Other
|
9,714
|
|
|
2.5
|
%
|
|
11,201
|
|
|
2.7
|
%
|
|
(1,487
|
)
|
|
(13.3
|
)%
|
|||
Total general and administrative expenses
|
$
|
66,419
|
|
|
17.1
|
%
|
|
$
|
84,535
|
|
|
20.2
|
%
|
|
$
|
(18,116
|
)
|
|
(21.4
|
)%
|
|
Years Ended December 31,
|
|
|
|
|
|||||||||||||||
(In thousands)
|
2018
|
|
% of Revenue
|
|
2017
|
|
% of Revenue
|
|
$ Change
|
|
% Change
|
|||||||||
Employee costs
|
$
|
38,094
|
|
|
9.1
|
%
|
|
$
|
30,362
|
|
|
7.5
|
%
|
|
$
|
7,732
|
|
|
25.5
|
%
|
Professional fees
|
21,528
|
|
|
5.1
|
%
|
|
17,383
|
|
|
4.3
|
%
|
|
4,145
|
|
|
23.8
|
%
|
|||
Transition services agreement
|
9,035
|
|
|
2.2
|
%
|
|
11,004
|
|
|
2.7
|
%
|
|
(1,969
|
)
|
|
(17.9
|
)%
|
|||
Lease expense and depreciation
|
3,711
|
|
|
0.9
|
%
|
|
3,148
|
|
|
0.8
|
%
|
|
563
|
|
|
17.9
|
%
|
|||
Bad debt expense
|
966
|
|
|
0.2
|
%
|
|
983
|
|
|
0.2
|
%
|
|
(17
|
)
|
|
(1.7
|
)%
|
|||
Other
|
11,201
|
|
|
2.7
|
%
|
|
11,771
|
|
|
2.9
|
%
|
|
(570
|
)
|
|
(4.8
|
)%
|
|||
Total general and administrative expenses
|
$
|
84,535
|
|
|
20.2
|
%
|
|
$
|
74,651
|
|
|
18.5
|
%
|
|
$
|
9,884
|
|
|
13.2
|
%
|
|
Years Ended December 31,
|
||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Change in fair value of financing derivatives
|
$
|
5,100
|
|
|
$
|
(14,226
|
)
|
|
$
|
—
|
|
Change in fair value of warrants liability
|
(2,411
|
)
|
|
—
|
|
|
—
|
|
|||
Change in fair value of investment in equity securities
|
(2,324
|
)
|
|
1,443
|
|
|
—
|
|
|||
Transition services agreement income
|
534
|
|
|
9,029
|
|
|
11,080
|
|
|||
Gain on forgiveness of obligation
|
—
|
|
|
—
|
|
|
4,000
|
|
|||
Other
|
755
|
|
|
2,290
|
|
|
125
|
|
|||
Total other income (expense), net
|
$
|
1,654
|
|
|
$
|
(1,464
|
)
|
|
$
|
15,205
|
|
•
|
Adjusted EBITDA does not reflect tax or interest payments that represent a reduction in cash available to us (or, in the case of interest paid in Common Stock, that represent additional dilution to our existing stockholders);
|
•
|
Depreciation and amortization are non-cash charges and the assets being depreciated may have to be replaced in the future. Adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements;
|
•
|
Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not reflect cash payments relating to fees incurred in connection with issuance of equity securities, restructuring, litigation and the Audit Committee investigation, such as litigation and investigation-related costs, costs associated with tax projects, audits and other professional, consulting or other fees incurred in connection with our prior-year audits and certain legal proceedings, all of which represent a reduction in cash available to us;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not consider the impact of stock-based compensation and similar arrangements that represent dilution to our existing stockholders;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not consider impairment of goodwill and long-lived assets, which represents a decline in the value of our assets;
|
•
|
Adjusted EBITDA and non-GAAP net loss do not consider possible cash gains or losses related to our financing derivatives, warrants liability or investment in equity securities; and
|
•
|
Other companies, including companies in our industry, may calculate any of these non-GAAP financial measures differently, which reduces their usefulness as comparative measures.
|
|
Years Ended December 31,
|
||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Net loss (GAAP)
|
$
|
(338,996
|
)
|
|
$
|
(159,268
|
)
|
|
$
|
(281,393
|
)
|
|
|
|
|
|
|
|
|
|
|||
Income tax (benefit) provision
|
(1,007
|
)
|
|
3,706
|
|
|
(2,717
|
)
|
|||
Interest expense, net
|
31,526
|
|
|
16,465
|
|
|
661
|
|
|||
Depreciation
|
12,778
|
|
|
17,259
|
|
|
23,339
|
|
|||
Amortization expense of finance leases
|
2,413
|
|
|
—
|
|
|
—
|
|
|||
Amortization of intangible assets
|
30,076
|
|
|
32,864
|
|
|
34,823
|
|
|||
EBITDA
|
(263,210
|
)
|
|
(88,974
|
)
|
|
(225,287
|
)
|
|||
|
|
|
|
|
|
|
|
|
|||
Adjustments:
|
|
|
|
|
|
|
|
|
|||
Stock-based and expected awards compensation expense(3)
|
16,695
|
|
|
37,151
|
|
|
34,261
|
|
|||
Investigation and audit related
|
4,305
|
|
|
38,338
|
|
|
83,398
|
|
|||
Settlement of certain litigation, net(2)
|
2,900
|
|
|
5,250
|
|
|
82,533
|
|
|||
Restructuring
|
3,263
|
|
|
11,837
|
|
|
10,510
|
|
|||
Impairment of goodwill
|
224,272
|
|
|
—
|
|
|
—
|
|
|||
Impairment of intangible asset
|
17,308
|
|
|
—
|
|
|
—
|
|
|||
Other expense (income), net (1)
|
682
|
|
|
12,783
|
|
|
(4,125
|
)
|
|||
Adjusted EBITDA
|
$
|
6,215
|
|
|
$
|
16,385
|
|
|
$
|
(18,710
|
)
|
|
Years Ended December 31,
|
||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Net loss (GAAP)
|
$
|
(338,996
|
)
|
|
$
|
(159,268
|
)
|
|
$
|
(281,393
|
)
|
|
|
|
|
|
|
|
|
|
|||
Adjustments:
|
|
|
|
|
|
|
|
|
|||
Stock-based and expected awards compensation expense(4)
|
16,695
|
|
|
37,151
|
|
|
34,261
|
|
|||
Investigation and audit related
|
4,305
|
|
|
38,338
|
|
|
83,398
|
|
|||
Amortization of intangible assets(3)
|
30,076
|
|
|
32,864
|
|
|
34,823
|
|
|||
Settlement of certain litigation, net(2)
|
2,900
|
|
|
5,250
|
|
|
82,533
|
|
|||
Restructuring
|
3,263
|
|
|
11,837
|
|
|
10,510
|
|
|||
Impairment of goodwill
|
224,272
|
|
|
—
|
|
|
—
|
|
|||
Impairment of intangible asset
|
17,308
|
|
|
—
|
|
|
—
|
|
|||
Other expense (income), net (1)
|
682
|
|
|
12,783
|
|
|
(4,125
|
)
|
|||
Non-GAAP net loss
|
$
|
(39,495
|
)
|
|
$
|
(21,045
|
)
|
|
$
|
(39,993
|
)
|
|
|
Years Ended December 31,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Consolidated Statements of Cash Flow Data:
|
|
|
|
|
|
|
||||||
Net cash used in operating activities
|
|
$
|
(4,636
|
)
|
|
$
|
(72,575
|
)
|
|
$
|
(56,405
|
)
|
Net cash (used in) provided by investing activities
|
|
$
|
(10,460
|
)
|
|
$
|
(13,814
|
)
|
|
$
|
18,254
|
|
Net cash provided by (used in) financing activities
|
|
$
|
31,973
|
|
|
$
|
93,119
|
|
|
$
|
(7,518
|
)
|
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
|
$
|
(302
|
)
|
|
$
|
(1,657
|
)
|
|
$
|
2,453
|
|
Net increase (decrease) in cash, cash equivalents and restricted cash
|
|
$
|
16,575
|
|
|
$
|
5,073
|
|
|
$
|
(43,216
|
)
|
(In thousands)
|
|
Total
|
|
Less Than
1 Year |
|
1-3 Years
|
|
3-5
Years |
|
More
Than 5 Years |
||||||||||
Operating lease obligations(1)
|
|
$
|
75,059
|
|
|
$
|
12,739
|
|
|
$
|
21,107
|
|
|
$
|
18,489
|
|
|
$
|
22,724
|
|
Finance lease obligations(2)
|
|
4,966
|
|
|
2,161
|
|
|
2,783
|
|
|
22
|
|
|
—
|
|
|||||
Sale-leaseback financing transaction(3)
|
|
3,669
|
|
|
2,247
|
|
|
1,422
|
|
|
—
|
|
|
—
|
|
|||||
Long-term debt obligations(4)
|
|
217,000
|
|
|
—
|
|
|
217,000
|
|
|
—
|
|
|
—
|
|
|||||
Unconditional purchase obligations with MVPDs(5)
|
|
102,609
|
|
|
41,035
|
|
|
43,052
|
|
|
18,522
|
|
|
—
|
|
|||||
Other long-term obligations(6)
|
|
3,860
|
|
|
2,114
|
|
|
1,746
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
407,163
|
|
|
$
|
60,296
|
|
|
$
|
287,110
|
|
|
$
|
37,033
|
|
|
$
|
22,724
|
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
If the Conversion Premium
(as of the applicable
Interest Reset Date) is:
|
|
Implied VWAP
|
|
Then the Interest Rate from
the applicable Interest Reset
Date until the next
subsequent Interest Reset
Date shall be:
|
1.0 or less
|
|
$31.29 or higher
|
|
4.0%
|
1.05
|
|
$29.80
|
|
4.3%
|
1.10
|
|
$28.45
|
|
4.7%
|
1.15
|
|
$27.21
|
|
5.0%
|
1.20
|
|
$26.08
|
|
5.3%
|
1.25
|
|
$25.03
|
|
5.7%
|
1.30
|
|
$24.07
|
|
6.0%
|
1.35
|
|
$23.18
|
|
8.0%
|
1.40
|
|
$22.35
|
|
10.0%
|
1.45 or higher
|
|
$21.58 or less
|
|
12.0%
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
|
Page
|
comScore, Inc. Consolidated Financial Statements
|
|
|
As of
|
|
As of
|
||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
46,590
|
|
|
$
|
44,096
|
|
Restricted cash
|
20,183
|
|
|
6,102
|
|
||
Accounts receivable, net of allowances of $1,919 and $1,597, respectively ($2,698 and $4,024 of accounts receivable attributable to related parties, respectively)
|
71,853
|
|
|
75,609
|
|
||
Prepaid expenses and other current assets ($1,180 and $484 attributable to related parties)
|
15,357
|
|
|
19,972
|
|
||
Total current assets
|
153,983
|
|
|
145,779
|
|
||
Property and equipment, net
|
31,693
|
|
|
27,339
|
|
||
Operating right-of-use assets
|
36,689
|
|
|
—
|
|
||
Other non-current assets
|
2,979
|
|
|
8,898
|
|
||
Deferred tax assets
|
2,374
|
|
|
3,991
|
|
||
Intangible assets, net
|
79,559
|
|
|
126,945
|
|
||
Goodwill
|
416,418
|
|
|
641,191
|
|
||
Total assets
|
$
|
723,695
|
|
|
$
|
954,143
|
|
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable ($2,510 and $1,878 attributable to related parties, respectively)
|
$
|
44,804
|
|
|
$
|
29,836
|
|
Accrued expenses ($6,902 and $4,478 attributable to related parties, respectively)
|
55,507
|
|
|
58,140
|
|
||
Accrued litigation settlements
|
3,575
|
|
|
3,500
|
|
||
Contract liability ($1,519 and $2,521 attributable to related parties, respectively)
|
58,158
|
|
|
64,189
|
|
||
Customer advances
|
9,886
|
|
|
6,688
|
|
||
Warrant liability
|
7,725
|
|
|
—
|
|
||
Current operating lease liabilities
|
6,764
|
|
|
—
|
|
||
Deferred rent
|
—
|
|
|
1,884
|
|
||
Other current liabilities
|
3,818
|
|
|
4,699
|
|
||
Total current liabilities
|
190,237
|
|
|
168,936
|
|
||
Secured term note
|
12,463
|
|
|
—
|
|
||
Financing derivatives (related party)
|
21,587
|
|
|
26,100
|
|
||
Senior secured convertible notes (related party)
|
184,075
|
|
|
177,342
|
|
||
Non-current operating lease liabilities
|
42,497
|
|
|
—
|
|
||
Deferred rent
|
—
|
|
|
10,304
|
|
||
Deferred tax liabilities
|
287
|
|
|
5,527
|
|
||
Other non-current liabilities ($- and $251 attributable to related parties)
|
13,575
|
|
|
14,367
|
|
||
Total liabilities
|
464,721
|
|
|
402,576
|
|
||
Commitments and contingencies
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $0.001 par value per share; 5,000,000 shares authorized at December 31, 2019 and 2018; no shares issued or outstanding as of December 31, 2019 or 2018
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value per share; 150,000,000 shares authorized as of December 31, 2019 and 2018; 76,829,926 shares issued and 70,065,130 shares outstanding as of December 31, 2019, and 66,154,626 shares issued and 59,389,830 shares outstanding as of December 31, 2018
|
70
|
|
|
59
|
|
||
Additional paid-in capital
|
1,609,358
|
|
|
1,561,208
|
|
||
Accumulated other comprehensive loss
|
(12,333
|
)
|
|
(10,621
|
)
|
||
Accumulated deficit
|
(1,108,137
|
)
|
|
(769,095
|
)
|
||
Treasury stock, at cost, and 6,764,796 shares as of December 31, 2019 and 2018
|
(229,984
|
)
|
|
(229,984
|
)
|
||
Total stockholders’ equity
|
258,974
|
|
|
551,567
|
|
||
Total liabilities and stockholders’ equity
|
$
|
723,695
|
|
|
$
|
954,143
|
|
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Accumulated
Deficit
|
|
Treasury stock, at cost
|
|
Total
Stockholders'
Equity
|
|||||||||||||||
Shares
|
|
Amount
|
|
|||||||||||||||||||||||
Balance as of December 31, 2016
|
57,172,597
|
|
|
$
|
60
|
|
|
$
|
1,380,881
|
|
|
$
|
(12,420
|
)
|
|
$
|
(327,698
|
)
|
|
$
|
(135,970
|
)
|
|
$
|
904,853
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(281,393
|
)
|
|
—
|
|
|
(281,393
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
6,168
|
|
|
—
|
|
|
—
|
|
|
6,168
|
|
||||||
Unrealized gain on marketable securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
28
|
|
|
—
|
|
|
—
|
|
|
28
|
|
||||||
Subscription Receivable
|
—
|
|
|
—
|
|
|
11,012
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,012
|
|
||||||
Restricted stock units vested
|
185,754
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Payments for taxes related to net share settlement of equity awards
|
(69,304
|
)
|
|
—
|
|
|
(1,514
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,514
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
17,338
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,338
|
|
||||||
Balance as of December 31, 2017
|
57,289,047
|
|
|
$
|
60
|
|
|
$
|
1,407,717
|
|
|
$
|
(6,224
|
)
|
|
$
|
(609,091
|
)
|
|
$
|
(135,970
|
)
|
|
$
|
656,492
|
|
Adoption of ASC 606
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(736
|
)
|
|
—
|
|
|
(736
|
)
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(159,268
|
)
|
|
—
|
|
|
(159,268
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,397
|
)
|
|
—
|
|
|
—
|
|
|
(4,397
|
)
|
||||||
Subscription Receivable
|
—
|
|
|
—
|
|
|
10,254
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,254
|
|
||||||
Common Stock warrants issued
|
—
|
|
|
—
|
|
|
5,545
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,545
|
|
||||||
Exercise of Common Stock options, net
|
222,229
|
|
|
—
|
|
|
2,855
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,855
|
|
||||||
Shares issued in connection with settlement of litigation
|
4,024,115
|
|
|
4
|
|
|
90,764
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
90,768
|
|
||||||
Repurchase of Common Stock in exchange for senior secured convertible notes
|
(4,000,000
|
)
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(94,014
|
)
|
|
(94,021
|
)
|
||||||
Restricted stock units vested
|
2,077,253
|
|
|
2
|
|
|
15,816
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,818
|
|
||||||
Payments for taxes related to net share settlement of equity awards
|
(222,814
|
)
|
|
—
|
|
|
(5,263
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,263
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
33,520
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,520
|
|
||||||
Balance as of December 31, 2018
|
59,389,830
|
|
|
$
|
59
|
|
|
$
|
1,561,208
|
|
|
$
|
(10,621
|
)
|
|
$
|
(769,095
|
)
|
|
$
|
(229,984
|
)
|
|
$
|
551,567
|
|
Adoption of ASC 842
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(46
|
)
|
|
—
|
|
|
(46
|
)
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(338,996
|
)
|
|
—
|
|
|
(338,996
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,712
|
)
|
|
—
|
|
|
—
|
|
|
(1,712
|
)
|
||||||
Issuance of Common Stock - CVI
|
2,728,513
|
|
|
3
|
|
|
8,159
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,162
|
|
||||||
Common Stock warrants exercised - Starboard
|
323,448
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common Stock warrants exercised - CVI
|
2,728,513
|
|
|
3
|
|
|
5,482
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,485
|
|
||||||
Exercise of Common Stock options, net
|
68,259
|
|
|
—
|
|
|
1,191
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,191
|
|
||||||
Interest paid in Common Stock
|
4,057,129
|
|
|
4
|
|
|
17,370
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,374
|
|
||||||
Restricted stock units vested
|
854,998
|
|
|
1
|
|
|
4,610
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,611
|
|
||||||
Payments for taxes related to net share settlement of equity awards
|
(85,560
|
)
|
|
—
|
|
|
(1,267
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,267
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
12,605
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,605
|
|
||||||
Balance as of December 31, 2019
|
70,065,130
|
|
|
$
|
70
|
|
|
$
|
1,609,358
|
|
|
$
|
(12,333
|
)
|
|
$
|
(1,108,137
|
)
|
|
$
|
(229,984
|
)
|
|
$
|
258,974
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Operating activities:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(338,996
|
)
|
|
$
|
(159,268
|
)
|
|
$
|
(281,393
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
||||||
Depreciation
|
12,778
|
|
|
17,259
|
|
|
23,339
|
|
|||
Non-cash operating lease expense
|
5,369
|
|
|
—
|
|
|
—
|
|
|||
Amortization expense of finance leases
|
2,413
|
|
|
—
|
|
|
—
|
|
|||
Amortization of intangible assets
|
30,076
|
|
|
32,864
|
|
|
34,823
|
|
|||
Impairment of goodwill
|
224,272
|
|
|
—
|
|
|
—
|
|
|||
Impairment of intangible asset
|
17,308
|
|
|
—
|
|
|
—
|
|
|||
Provision for bad debts
|
727
|
|
|
966
|
|
|
983
|
|
|||
Stock-based compensation
|
16,558
|
|
|
37,619
|
|
|
17,314
|
|
|||
Deferred tax (benefit) provision
|
(3,727
|
)
|
|
2,019
|
|
|
(3,203
|
)
|
|||
Change in fair value of financing derivatives
|
(5,100
|
)
|
|
14,226
|
|
|
—
|
|
|||
Change in fair value of warrant liability
|
2,411
|
|
|
—
|
|
|
—
|
|
|||
Change in fair value of investment in equity securities
|
2,324
|
|
|
(1,443
|
)
|
|
—
|
|
|||
Non-cash interest expense on senior secured convertible notes (related party)
|
17,374
|
|
|
—
|
|
|
—
|
|
|||
Accretion of debt discount
|
6,242
|
|
|
4,812
|
|
|
—
|
|
|||
Amortization of deferred financing costs
|
1,078
|
|
|
955
|
|
|
—
|
|
|||
Gain on forgiveness of obligation
|
—
|
|
|
—
|
|
|
(4,000
|
)
|
|||
Accrued litigation settlements to be settled in Common Stock
|
—
|
|
|
—
|
|
|
90,800
|
|
|||
Other
|
(2
|
)
|
|
568
|
|
|
192
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
2,738
|
|
|
4,707
|
|
|
14,529
|
|
|||
Prepaid expenses and other assets
|
2,198
|
|
|
(4,456
|
)
|
|
4,067
|
|
|||
Insurance recoverable on litigation settlements
|
—
|
|
|
10,000
|
|
|
(37,232
|
)
|
|||
Accounts payable, accrued expenses, and other liabilities
|
10,438
|
|
|
(4,955
|
)
|
|
85,001
|
|
|||
Contract liability and customer advances
|
(3,477
|
)
|
|
(30,013
|
)
|
|
(2,638
|
)
|
|||
Deferred rent
|
—
|
|
|
1,565
|
|
|
1,013
|
|
|||
Current operating lease liability
|
(7,638
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash used in operating activities
|
(4,636
|
)
|
|
(72,575
|
)
|
|
(56,405
|
)
|
|||
|
|
|
|
|
|
||||||
Investing activities:
|
|
|
|
|
|
||||||
Sales of marketable securities
|
3,776
|
|
|
—
|
|
|
28,436
|
|
|||
Purchases of property and equipment
|
(2,736
|
)
|
|
(4,206
|
)
|
|
(10,182
|
)
|
|||
Capitalized internal-use software costs
|
(11,500
|
)
|
|
(9,608
|
)
|
|
—
|
|
|||
Net cash (used in) provided by investing activities
|
(10,460
|
)
|
|
(13,814
|
)
|
|
18,254
|
|
|||
|
|
|
|
|
|
||||||
Financing activities:
|
|
|
|
|
|
||||||
Proceeds from borrowings on senior secured convertible notes (related party)
|
—
|
|
|
100,000
|
|
|
—
|
|
|||
Debt issuance costs
|
—
|
|
|
(5,146
|
)
|
|
—
|
|
|||
Proceeds from secured term note
|
13,000
|
|
|
—
|
|
|
—
|
|
|||
Secured term note issuance costs
|
(350
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from private placement, net of issuance costs paid
|
19,752
|
|
|
—
|
|
|
—
|
|
|||
Financing proceeds received on subscription receivable (related party)
|
—
|
|
|
9,679
|
|
|
11,012
|
|
|||
Proceeds from sale-leaseback financing transaction
|
4,252
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from the exercise of stock options
|
1,191
|
|
|
2,855
|
|
|
—
|
|
|||
Payments for taxes related to net share settlement of equity awards
|
(1,267
|
)
|
|
(5,263
|
)
|
|
(1,514
|
)
|
1.
|
Organization
|
•
|
During 2018, the Company entered into certain agreements with funds affiliated with or managed by Starboard Value LP (collectively, "Starboard"), pursuant to which the Company issued and sold to Starboard a total of $204.0 million in senior secured convertible notes as well as warrants to purchase shares of the Company's common stock, par value $0.001 per share (the "Common Stock") in exchange for $100.0 million in cash and 4,000,000 shares of Common Stock. For additional information, refer to Footnote 4, Long-term Debt.
|
•
|
On June 26, 2019, the Company issued 2,728,513 shares of Common Stock and four series of warrants in a private placement to CVI Investments, Inc. ("CVI") in exchange for gross cash proceeds of $20.0 million. On October 14, 2019, the Company issued 2,728,513 shares of Common Stock to CVI upon exercise by CVI of the Series C warrant. For additional information, refer to Footnote 5, Stockholders' Equity.
|
•
|
On December 31, 2019, the Company's wholly owned subsidiary, Rentrak B.V., entered into an agreement with several third parties (collectively the "Noteholder") for a secured term note (the "Secured Term Note") in exchange for gross proceeds $13.0 million. The Secured Term Note matures on December 31, 2021, is cash collateralized, and has an annual interest rate of 9.75% that is payable monthly in arrears. For additional information, refer to Footnote 4, Long-term Debt.
|
2.
|
Summary of Significant Accounting Policies
|
|
|
Years Ended December 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Beginning Balance
|
|
$
|
(1,597
|
)
|
|
$
|
(1,991
|
)
|
Additions
|
|
(727
|
)
|
|
(966
|
)
|
||
Recoveries
|
|
(481
|
)
|
|
(225
|
)
|
||
Write-offs
|
|
886
|
|
|
1,585
|
|
||
Ending Balance
|
|
$
|
(1,919
|
)
|
|
$
|
(1,597
|
)
|
|
Useful Lives (Years)
|
Acquired methodologies/technology
|
2 to 7
|
Acquired software
|
3
|
Customer relationships
|
3 to 7
|
Intellectual property
|
2 to 13
|
Panel
|
1 to 7
|
Trade Names
|
2 to 6
|
Other
|
6 to 8
|
•
|
Not to reassess whether any expired or existing contracts are or contain leases.
|
•
|
Not to reassess the lease classification for any expired or existing leases.
|
•
|
Not to reassess initial direct costs for any existing leases.
|
•
|
The hindsight practical expedient in determining the lease term.
|
•
|
The practical expedient whereby the lease and non-lease components will not be separated for all classes of assets.
|
•
|
Not to record ROU assets and corresponding lease liabilities with a lease term of 12 months or less.
|
(In thousands)
|
As previously reported as of December 31, 2018
|
|
New lease standard adjustments
|
|
As adjusted as of January 1, 2019
|
||||||
Operating right-of-use assets
|
$
|
—
|
|
|
$
|
42,472
|
|
|
$
|
42,472
|
|
Property and equipment, net
|
27,339
|
|
|
(203
|
)
|
|
27,136
|
|
|||
Current capital lease obligations
|
2,421
|
|
|
(161
|
)
|
|
2,260
|
|
|||
Current restructuring accrual
|
5,479
|
|
|
(708
|
)
|
|
4,771
|
|
|||
Current deferred rent
|
1,884
|
|
|
(1,884
|
)
|
|
—
|
|
|||
Current operating lease liabilities
|
—
|
|
|
7,846
|
|
|
7,846
|
|
|||
Non-current restructuring accrual
|
1,810
|
|
|
(1,810
|
)
|
|
—
|
|
|||
Non-current deferred rent
|
10,304
|
|
|
(10,304
|
)
|
|
—
|
|
|||
Non-current capital lease obligations
|
1,182
|
|
|
3
|
|
|
1,185
|
|
|||
Non-current operating lease liabilities
|
—
|
|
|
49,333
|
|
|
49,333
|
|
|||
Stockholders' equity
|
551,567
|
|
|
(46
|
)
|
|
551,521
|
|
|
Years Ended December 31,
|
||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Change in fair value of financing derivatives
|
$
|
5,100
|
|
|
$
|
(14,226
|
)
|
|
$
|
—
|
|
Change in fair value of warrants liability
|
(2,411
|
)
|
|
—
|
|
|
—
|
|
|||
Change in fair value of investment in equity securities
|
(2,324
|
)
|
|
1,443
|
|
|
—
|
|
|||
Transition services agreement income
|
534
|
|
|
9,029
|
|
|
11,080
|
|
|||
Gain on forgiveness of obligation
|
—
|
|
|
—
|
|
|
4,000
|
|
|||
Other
|
755
|
|
|
2,290
|
|
|
125
|
|
|||
Total other income (expense), net
|
$
|
1,654
|
|
|
$
|
(1,464
|
)
|
|
$
|
15,205
|
|
|
Years Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Stock options, stock appreciation rights, restricted stock units, senior secured convertible notes and warrants
|
12,443,032
|
|
|
8,392,748
|
|
|
2,837,872
|
|
3.
|
Revenue Recognition
|
|
|
Years Ended December 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
By solution group:
|
|
|
|
|
||||
Ratings and Planning
|
|
$
|
271,623
|
|
|
$
|
285,355
|
|
Analytics and Optimization
|
|
74,725
|
|
|
92,380
|
|
||
Movies Reporting and Analytics
|
|
42,297
|
|
|
41,747
|
|
||
Total
|
|
$
|
388,645
|
|
|
$
|
419,482
|
|
By geographical market:
|
|
|
|
|
||||
United States
|
|
$
|
336,087
|
|
|
$
|
359,379
|
|
Europe
|
|
30,619
|
|
|
34,623
|
|
||
Latin America
|
|
10,326
|
|
|
13,179
|
|
||
Canada
|
|
7,046
|
|
|
7,882
|
|
||
Other
|
|
4,567
|
|
|
4,419
|
|
||
Total
|
|
$
|
388,645
|
|
|
$
|
419,482
|
|
By timing of revenue recognition:
|
|
|
|
|
||||
Products and services transferred at a point in time
|
|
$
|
93,036
|
|
|
$
|
113,583
|
|
Products and services transferred over time
|
|
295,609
|
|
|
305,899
|
|
||
Total
|
|
$
|
388,645
|
|
|
$
|
419,482
|
|
|
|
As of
|
|
As of
|
||||
(In thousands)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Accounts receivable, net
|
|
$
|
71,853
|
|
|
$
|
75,609
|
|
Current and non-current contract assets
|
|
1,035
|
|
|
2,438
|
|
||
Current and non-current contract costs
|
|
799
|
|
|
1,402
|
|
||
Current contract liability
|
|
58,158
|
|
|
64,189
|
|
||
Current customer advances
|
|
9,886
|
|
|
6,688
|
|
||
Non-current contract liability
|
|
291
|
|
|
508
|
|
|
Contract Liability (Current)
|
||||||
|
Years Ended December 31,
|
||||||
(In thousands)
|
2019
|
|
2018
|
||||
Revenue recognized that was included in the contract liability balance at the beginning of period
|
$
|
(58,918
|
)
|
|
$
|
(75,162
|
)
|
Cash received or amounts billed in advance and not recognized as revenue
|
53,881
|
|
|
60,040
|
|
4.
|
Long-term Debt
|
•
|
Credit Adjusted Discount Rate: The Company estimated a market-based discount rate of 25%.
|
•
|
Stock Price: The stock price was measured using the fair value of the Common Stock on the closing date of the Initial Notes issuance, January 16, 2018, which was $24.45 per share.
|
•
|
Volatility: Based on the historical volatility of the Company's Common Stock, determined to be 41.3% as of the valuation date.
|
•
|
Term: Based on the time period of the Notes maturity, 4 years.
|
•
|
Risk Free Rate: Assumed to be 2.2% based on the Federal Reserve bond yield.
|
•
|
Stock Price: The stock price was measured using the fair value of the Common Stock on the closing date of the Initial Notes issuance, January 16, 2018, which was $24.45 per share.
|
•
|
Volatility: Based on the historical volatility of the Company's Common Stock, determined to be 38.4% as of the valuation date.
|
•
|
Term: Based on the time period of the Notes Option, 6 months.
|
•
|
Risk Free Rate: Assumed to be 1.6% based on the Federal Reserve bond yield with a term commensurate with the remaining life of the Notes Option.
|
•
|
Probability: The Company utilized a range between 0% and 10% to estimate the likelihood of occurrence.
|
•
|
Term: Based on the time period of the feature, 4 years.
|
•
|
Risk Free Rate: Assumed to be 2.2% based on the U.S. Treasury bonds on the valuation date with a term commensurate with the remaining life of the change of control derivative.
|
•
|
Stock Price: The stock price was measured using fair value of the Common Stock on the closing date of the Initial Notes issuance, January 16, 2018, which was $24.45 per share.
|
•
|
Volatility: The Company determined volatility to be 39.6% based on the historical volatility of its Common Stock daily volume weighted average price with a look-back period commensurate with the term of the warrants.
|
•
|
Risk Free Rate: Assumed to be 2.4% based on U.S. Treasury bonds on the valuation date with a 5-year term.
|
•
|
Dividend Yield: Assumed to be zero based on the historical payout history of the Company.
|
•
|
Stock Price: The stock price was measured using the fair value of the Common Stock on the closing date of the Option Notes issuance, May 17, 2018, which was $21.75 per share.
|
•
|
Volatility: Based on the historical volatility of the Company's Common Stock, determined to be 26.3% as of the valuation date.
|
•
|
Term: Based on the time period of the expected exercise of the Notes Option, 0.16 years.
|
•
|
Risk Free Rate: Assumed to be 1.8% based on the Federal Reserve bond yield with a term commensurate with the remaining life of the Notes Option.
|
•
|
Credit Adjusted Discount Rate: The Company estimated a market-based discount rate of 24%.
|
•
|
Stock Price: The stock price was measured using the fair value of the Common Stock on the closing date of the Option Notes issuance, May 17, 2018, which was $21.75 per share.
|
•
|
Volatility: Based on the historical volatility of the Company's Common Stock, determined to be 42.6% as of the valuation date.
|
•
|
Term: Based on the time period of the Option Notes maturity, 3.7 years.
|
•
|
Risk Free Rate: Assumed to be 2.8% based on the Federal Reserve bond yield.
|
•
|
Probability: The Company utilized a range between 0% and 10% to estimate the likelihood of occurrence.
|
•
|
Term: Based on the time period of the feature, 3.7 years.
|
•
|
Risk Free Rate: Assumed to be 2.8% based on U.S. Treasury bonds on the valuation date with a term commensurate with the remaining life of the change of control derivative.
|
•
|
Probability: The Company utilized a range between 0% and 5% to estimate the likelihood of occurrence.
|
•
|
Term: Based on the time period of the feature, 0.7 years.
|
•
|
Credit Adjusted Discount Rate: The Company estimated a market-based discount rate of 25.0%.
|
|
|
|
|
|
As of
|
||||||||||||||
|
|
|
|
|
December 31, 2019
|
||||||||||||||
(In thousands, except interest rates)
|
Stated Interest Rate
|
|
Effective Interest Rate
|
|
Face Value
|
|
Issuance Discount
|
|
Deferred Financing Costs
|
|
Net Carrying Value
|
||||||||
Initial Notes, due January 16, 2022
|
12.0%
|
|
18.8%
|
|
$
|
153,500
|
|
|
$
|
(14,703
|
)
|
|
$
|
(2,706
|
)
|
|
$
|
136,091
|
|
Option Notes, due January 16, 2022
|
12.0%
|
|
14.9%
|
|
50,500
|
|
|
(2,365
|
)
|
|
(151
|
)
|
|
47,984
|
|
||||
Total
|
|
|
|
|
$
|
204,000
|
|
|
$
|
(17,068
|
)
|
|
$
|
(2,857
|
)
|
|
$
|
184,075
|
|
|
|
|
|
|
As of
|
||||||||||||||
|
|
|
|
|
December 31, 2018
|
||||||||||||||
(In thousands, except interest rates)
|
Stated Interest Rate
|
|
Effective Interest Rate
|
|
Face Value
|
|
Original Issuance Discount
|
|
Deferred Financing Costs
|
|
Net Carrying Value
|
||||||||
Initial Notes, due January 16, 2022
|
6.0%
|
|
12.0%
|
|
$
|
153,500
|
|
|
$
|
(19,627
|
)
|
|
$
|
(3,724
|
)
|
|
$
|
130,149
|
|
Option Notes, due January 16, 2022
|
6.0%
|
|
8.5%
|
|
50,500
|
|
|
(3,096
|
)
|
|
(211
|
)
|
|
47,193
|
|
||||
Total
|
|
|
|
|
$
|
204,000
|
|
|
$
|
(22,723
|
)
|
|
$
|
(3,935
|
)
|
|
$
|
177,342
|
|
|
|
|
|
|
As of
|
||||||||||
|
|
|
|
|
December 31, 2019
|
||||||||||
(In thousands, except interest rates)
|
Stated Interest Rate
|
|
Effective Interest Rate
|
|
Face Value
|
|
Deferred Financing Costs
|
|
Net Carrying Value
|
||||||
Secured Term Note
|
9.75%
|
|
12.2%
|
|
$
|
13,000
|
|
|
$
|
(537
|
)
|
|
$
|
12,463
|
|
5.
|
Stockholders' Equity
|
•
|
Stock price: The stock price was measured using the fair value of the Common Stock on the Closing Date, which was $5.57 per share.
|
•
|
Volatility: The Company determined volatility to be 50.0% based on (i) the historical volatility of the Common Stock daily volume weighted average price with a look-back period commensurate with the term of the warrants and (ii) options-based implied volatility.
|
•
|
Term: Management determined the term based on the time period of each warrant's maturity, between six months and five years from the Closing Date.
|
•
|
Change of control probability: The Company utilized a range between 0.0% and 10.0% to estimate the likelihood of occurrence.
|
•
|
Risk-free rate: Management assumed the risk-free rate to be between 1.7% and 2.1%, based on the U.S. Treasury bonds on the valuation date with terms commensurate with the terms of each warrant.
|
•
|
Cost of debt: Management assumed the cost of debt to be between 16.7% and 18.7% based on a synthetic credit rating analysis.
|
•
|
Dividend yield: Management assumed the dividend yield to be zero based on the historical payout of the Company.
|
(in thousands)
|
Warrants Liability
|
||
Series A Warrants
|
$
|
3,862
|
|
Series B-1 Warrants (1)
|
328
|
|
|
Series B-2 Warrants
|
376
|
|
|
Series C Warrants (2)
|
6,232
|
|
|
Total
|
$
|
10,798
|
|
1) Series B-1 warrants expired in January 2020.
2) Series C warrants were exercised in October 2019.
|
|
Dividend yield
|
0.0%
|
|||
Expected volatility
|
44.5
|
%
|
-
|
52.9%
|
Risk-free interest rate
|
1.3
|
%
|
-
|
2.7%
|
Expected life of options (in years)
|
5.21
|
|
-
|
10.00
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||
Range of Exercise Prices
|
|
Options Outstanding
|
|
Weighted
Average Exercise Price |
|
Weighted
Average Remaining Contractual Life (Years) |
|
Options
Exercisable
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Life (Years)
|
||||||
$1.88 - 5.38
|
|
635,000
|
|
|
$
|
3.57
|
|
|
9.84
|
|
81,250
|
|
|
$
|
2.57
|
|
|
9.70
|
$10.00 - $19.31
|
|
638,385
|
|
|
12.98
|
|
|
5.38
|
|
418,385
|
|
|
14.42
|
|
|
3.26
|
||
$20.11 - $25.86
|
|
259,525
|
|
|
25.22
|
|
|
1.15
|
|
259,525
|
|
|
25.22
|
|
|
1.15
|
||
$40.80
|
|
6,057
|
|
|
40.80
|
|
|
4.62
|
|
6,057
|
|
|
40.80
|
|
|
4.62
|
||
|
|
1,538,967
|
|
|
$
|
11.27
|
|
|
6.51
|
|
765,217
|
|
|
$
|
17.04
|
|
|
3.24
|
Unvested Stock Awards
|
|
Restricted
Stock Awards
|
|
Restricted
Stock Units
|
|
Number of
Shares
Underlying
Awards
|
|
Weighted
Average Grant-Date Fair Value |
|||||
Unvested as of December 31, 2016
|
|
3,748
|
|
|
1,042,385
|
|
|
1,046,133
|
|
|
$
|
37.16
|
|
Vested
|
|
(1,623
|
)
|
|
(185,754
|
)
|
|
(187,377
|
)
|
|
36.45
|
|
|
Forfeited
|
|
—
|
|
|
(76,719
|
)
|
|
(76,719
|
)
|
|
38.48
|
|
|
Unvested as of December 31, 2017
|
|
2,125
|
|
|
779,912
|
|
|
782,037
|
|
|
$
|
37.22
|
|
Granted
|
|
—
|
|
|
2,872,408
|
|
|
2,872,408
|
|
|
22.53
|
|
|
Vested
|
|
(2,125
|
)
|
|
(2,077,253
|
)
|
|
(2,079,378
|
)
|
|
27.55
|
|
|
Forfeited
|
|
—
|
|
|
(108,932
|
)
|
|
(108,932
|
)
|
|
29.50
|
|
|
Unvested as of December 31, 2018
|
|
—
|
|
|
1,466,135
|
|
|
1,466,135
|
|
|
$
|
22.62
|
|
Granted
|
|
—
|
|
|
2,578,866
|
|
|
2,578,866
|
|
|
7.56
|
|
|
Vested
|
|
—
|
|
|
(854,998
|
)
|
|
(854,998
|
)
|
|
23.96
|
|
|
Forfeited
|
|
—
|
|
|
(529,767
|
)
|
|
(529,767
|
)
|
|
18.47
|
|
|
Unvested as of December 31, 2019
|
|
—
|
|
|
2,660,236
|
|
|
2,660,236
|
|
|
$
|
8.42
|
|
6.
|
Fair Value Measurements
|
|
|
As of
|
|
As of
|
||||||||||||||||||||||||||||
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Money market funds (1)
|
|
$
|
24,327
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24,327
|
|
|
$
|
6,037
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,037
|
|
Certificates of deposit (2)
|
|
—
|
|
|
1,009
|
|
|
—
|
|
|
1,009
|
|
|
—
|
|
|
986
|
|
|
—
|
|
|
986
|
|
||||||||
Investment in equity securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,100
|
|
|
—
|
|
|
—
|
|
|
6,100
|
|
||||||||
Total
|
|
$
|
24,327
|
|
|
$
|
1,009
|
|
|
$
|
—
|
|
|
$
|
25,336
|
|
|
$
|
12,137
|
|
|
$
|
986
|
|
|
$
|
—
|
|
|
$
|
13,123
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Financing derivatives: no hedging designation (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest rate reset
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18,800
|
|
|
$
|
18,800
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
23,300
|
|
|
$
|
23,300
|
|
Make-whole change of control
|
|
—
|
|
|
—
|
|
|
1,600
|
|
|
1,600
|
|
|
—
|
|
|
—
|
|
|
2,800
|
|
|
2,800
|
|
||||||||
Qualifying change of control
|
|
—
|
|
|
—
|
|
|
1,187
|
|
|
1,187
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Warrants Issued: (4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Series A
|
|
—
|
|
|
—
|
|
|
7,508
|
|
|
7,508
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Series B-2
|
|
—
|
|
|
—
|
|
|
217
|
|
|
217
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
29,312
|
|
|
$
|
29,312
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
26,100
|
|
|
$
|
26,100
|
|
(In thousands)
|
|
Financing Derivative Liabilities
|
||
Balance as of December 31, 2017
|
|
$
|
—
|
|
Issuances
|
|
17,574
|
|
|
Total losses included in other income (expense), net (1)
|
|
14,226
|
|
|
Settlement (2)
|
|
(5,700
|
)
|
|
Balance as of December 31, 2018
|
|
26,100
|
|
|
Issuances
|
|
587
|
|
|
Total gain included in other income (expense), net (3)
|
|
(5,100
|
)
|
|
Balance as of December 31, 2019
|
|
$
|
21,587
|
|
(In thousands)
|
|
Warrants Liability
|
||
Balance as of December 31, 2018
|
|
$
|
—
|
|
Issuance of warrants liability
|
|
10,798
|
|
|
Settlement
|
|
(5,484
|
)
|
|
Total losses included in other income (expense), net (1)
|
|
2,411
|
|
|
Balance as of December 31, 2019
|
|
$
|
7,725
|
|
|
Fair value measurements
|
||||||||
|
Significant valuation technique
|
|
Significant valuation inputs
|
|
December 31, 2019
|
|
December 31, 2018
|
||
Interest rate reset derivative liability
|
Discounted cash flow
|
|
Discount rate
|
|
25.0%
|
|
25.0%
|
||
|
|
|
Stock price
|
|
$4.94
|
|
$14.43
|
||
|
|
|
Volatility
|
|
74.1%
|
|
43.9%
|
||
|
|
|
Term
|
|
2.04 years
|
|
3.04 years
|
||
|
|
|
Risk-free rate
|
|
1.6%
|
|
2.5%
|
||
|
|
|
|
|
|
|
|
||
Make-whole change of control redemption derivative liability
|
Option pricing model
|
|
Change of control probability
|
|
5.0 - 10.0%
|
|
0.0 - 10.0%
|
||
|
|
|
Term
|
|
2.04 years
|
|
3.04 years
|
||
|
|
|
Risk-free rate
|
|
1.6%
|
|
2.5%
|
||
|
|
|
|
|
|
|
|
||
Qualifying change of control redemption derivative liability
|
Discounted cash flow
|
|
Change of control probability
|
|
5.0%
|
|
|
||
|
|
|
Term
|
|
0.60 years
|
|
|
||
|
|
|
Discount rate
|
|
25.0%
|
|
|
||
|
|
|
|
|
|
|
|
||
Warrants liability(1)
|
Option pricing model
|
|
Stock price
|
|
$4.94
|
|
|
||
|
|
|
Volatility
|
|
65.0%
|
|
|
||
|
|
|
Term
|
|
0.59 - 4.49 years
|
|
|
||
|
|
|
Change of control probability
|
|
5.0 - 10.0%
|
|
|
||
|
|
|
Risk-free rate
|
|
1.6 - 1.7%
|
|
|
||
|
|
|
Cost of debt
|
|
14.7 - 16.0%
|
|
|
7.
|
Property and Equipment
|
|
|
As of
|
|
As of
|
||||
|
|
December 31,
|
|
December 31,
|
||||
(In thousands)
|
|
2019 (1)
|
|
2018
|
||||
Computer equipment (including capital leases of $7,859 in 2018)
|
|
$
|
103,604
|
|
|
$
|
107,405
|
|
Capitalized internal-use software
|
|
21,534
|
|
|
9,608
|
|
||
Leasehold improvements
|
|
18,453
|
|
|
16,430
|
|
||
Computer software (including software license arrangements of $936 in 2019, and capital leases of $684 in 2018)(2)
|
|
8,956
|
|
|
8,709
|
|
||
Finance leases
|
|
5,442
|
|
|
—
|
|
||
Office equipment, furniture, and other (including capital leases of $925 in 2018)
|
|
5,619
|
|
|
5,802
|
|
||
Total property and equipment
|
|
163,608
|
|
|
147,954
|
|
||
Less: accumulated depreciation and amortization (including software license arrangements of $400 in 2019, and capital leases of $5,685 in 2018)
|
|
(131,915
|
)
|
|
(120,615
|
)
|
||
Total property and equipment, net
|
|
$
|
31,693
|
|
|
$
|
27,339
|
|
8.
|
Leases
|
|
|
Year Ended
|
|||
(In thousands)
|
|
December 31, 2019
|
|||
Supplemental Cash Flows Information
|
|
|
|||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|||
Operating cash flows from finance leases
|
|
$
|
471
|
|
|
Operating cash flows from operating leases
|
|
15,546
|
|
||
Financing cash flows from finance leases
|
|
2,535
|
|
||
Right-of-use assets obtained in exchange for lease obligations:
|
|
|
|||
Right-of-use assets obtained in exchange for new finance lease liabilities
|
|
$
|
4,049
|
|
|
Right-of-use assets obtained in exchange for new operating lease liabilities
|
|
397
|
|
(In thousands)
|
Operating Leases
|
|
Finance Leases
|
||||
2020
|
$
|
12,739
|
|
|
$
|
2,161
|
|
2021
|
12,016
|
|
|
1,911
|
|
||
2022
|
9,091
|
|
|
872
|
|
||
2023
|
9,731
|
|
|
22
|
|
||
2024
|
8,758
|
|
|
—
|
|
||
Thereafter
|
22,724
|
|
|
—
|
|
||
Total lease payments
|
75,059
|
|
|
4,966
|
|
||
Less: imputed interest
|
(25,798
|
)
|
|
(716
|
)
|
||
Total lease liabilities
|
49,261
|
|
|
4,250
|
|
||
Less: current lease liabilities
|
(6,764
|
)
|
|
(1,720
|
)
|
||
Total non-current lease liabilities
|
$
|
42,497
|
|
|
$
|
2,530
|
|
(In thousands)
|
Sublease Receipts
|
||
2020
|
$
|
1,681
|
|
2021
|
1,599
|
|
|
2022
|
1,566
|
|
|
2023
|
1,145
|
|
|
2024
|
794
|
|
|
Thereafter
|
2,053
|
|
|
Total expected sublease receipts
|
$
|
8,838
|
|
|
As of
|
||
(In thousands)
|
December 31, 2018
|
||
2019
|
$
|
2,582
|
|
2020
|
744
|
|
|
2021
|
417
|
|
|
2022
|
76
|
|
|
2023
|
44
|
|
|
Total minimum lease payments
|
3,863
|
|
|
Less amount representing interest
|
260
|
|
|
Present value of net minimum lease payments
|
3,603
|
|
|
Less current portion
|
2,421
|
|
|
Capital lease obligations, long-term
|
$
|
1,182
|
|
(In thousands)
|
Operating Lease Commitment
|
|
Sublease Receipts
|
||||
2019
|
$
|
14,780
|
|
|
$
|
1,385
|
|
2020
|
13,027
|
|
|
1,693
|
|
||
2021
|
12,259
|
|
|
1,597
|
|
||
2022
|
9,322
|
|
|
1,551
|
|
||
2023
|
9,722
|
|
|
1,145
|
|
||
Thereafter
|
31,475
|
|
|
2,905
|
|
||
Total minimum lease payments
|
$
|
90,585
|
|
|
$
|
10,276
|
|
9.
|
Goodwill and Intangible Assets
|
|
|
As of
|
|
As of
|
||||||||||||||||||||||||
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||
(In thousands)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Accumulated Impairment
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||||
Acquired methodologies/technology
|
|
$
|
148,386
|
|
|
$
|
(86,771
|
)
|
|
$
|
—
|
|
|
$
|
61,615
|
|
|
$
|
148,374
|
|
|
$
|
(66,690
|
)
|
|
$
|
81,684
|
|
Customer relationships
|
|
40,143
|
|
|
(25,864
|
)
|
|
—
|
|
|
14,279
|
|
|
40,127
|
|
|
(20,338
|
)
|
|
19,789
|
|
|||||||
Intellectual property
|
|
14,372
|
|
|
(12,346
|
)
|
|
—
|
|
|
2,026
|
|
|
14,366
|
|
|
(11,905
|
)
|
|
2,461
|
|
|||||||
Acquired software
|
|
9,287
|
|
|
(7,928
|
)
|
|
—
|
|
|
1,359
|
|
|
9,287
|
|
|
(5,531
|
)
|
|
3,756
|
|
|||||||
Trade names
|
|
768
|
|
|
(691
|
)
|
|
—
|
|
|
77
|
|
|
775
|
|
|
(636
|
)
|
|
139
|
|
|||||||
Strategic alliance
|
|
30,100
|
|
|
(12,792
|
)
|
|
(17,308
|
)
|
|
—
|
|
|
30,100
|
|
|
(11,288
|
)
|
|
18,812
|
|
|||||||
Panel
|
|
3,123
|
|
|
(3,123
|
)
|
|
—
|
|
|
—
|
|
|
3,107
|
|
|
(3,107
|
)
|
|
—
|
|
|||||||
Other
|
|
600
|
|
|
(397
|
)
|
|
—
|
|
|
203
|
|
|
600
|
|
|
(296
|
)
|
|
304
|
|
|||||||
Total intangible assets
|
|
$
|
246,779
|
|
|
$
|
(149,912
|
)
|
|
$
|
(17,308
|
)
|
|
$
|
79,559
|
|
|
$
|
246,736
|
|
|
$
|
(119,791
|
)
|
|
$
|
126,945
|
|
|
(In years)
|
Intellectual property
|
4.7
|
Customer relationships
|
2.6
|
Acquired methodologies/technology
|
2.4
|
Trade names
|
1.2
|
Acquired software
|
0.9
|
Other
|
1.3
|
10.
|
Accrued Expenses
|
|
|
As of
|
|
As of
|
||||
|
|
December 31,
|
|
December 31,
|
||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Accrued data costs
|
|
19,593
|
|
|
14,617
|
|
||
Payroll and payroll-related
|
|
$
|
15,412
|
|
|
$
|
18,972
|
|
Accrued interest on senior secured convertible notes
|
|
6,120
|
|
|
3,046
|
|
||
Professional fees
|
|
4,118
|
|
|
8,477
|
|
||
Restructuring accrual
|
|
992
|
|
|
5,479
|
|
||
Other
|
|
9,272
|
|
|
7,549
|
|
||
Total accrued expenses
|
|
$
|
55,507
|
|
|
$
|
58,140
|
|
11.
|
Commitments and Contingencies
|
12.
|
Income Taxes
|
|
|
Years Ended December 31,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Domestic
|
|
$
|
(316,479
|
)
|
|
$
|
(140,298
|
)
|
|
$
|
(258,735
|
)
|
Foreign
|
|
(23,524
|
)
|
|
(15,264
|
)
|
|
(25,375
|
)
|
|||
Total
|
|
$
|
(340,003
|
)
|
|
$
|
(155,562
|
)
|
|
$
|
(284,110
|
)
|
|
|
Years Ended December 31,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(850
|
)
|
State
|
|
(42
|
)
|
|
(119
|
)
|
|
(155
|
)
|
|||
Foreign
|
|
2,762
|
|
|
1,806
|
|
|
1,491
|
|
|||
Total
|
|
$
|
2,720
|
|
|
$
|
1,687
|
|
|
$
|
486
|
|
Deferred:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
(1,189
|
)
|
|
$
|
898
|
|
|
$
|
(5,216
|
)
|
State
|
|
(3,992
|
)
|
|
1,060
|
|
|
1,120
|
|
|||
Foreign
|
|
1,454
|
|
|
61
|
|
|
893
|
|
|||
Total
|
|
$
|
(3,727
|
)
|
|
$
|
2,019
|
|
|
$
|
(3,203
|
)
|
Income tax (benefit) provision
|
|
$
|
(1,007
|
)
|
|
$
|
3,706
|
|
|
$
|
(2,717
|
)
|
|
|
Years Ended December 31,
|
|||||||
|
|
2019
|
|
2018
|
|
2017
|
|||
Statutory federal tax rate
|
|
21.0
|
%
|
|
21.0
|
%
|
|
35.0
|
%
|
State taxes
|
|
1.1
|
%
|
|
(2.8
|
)%
|
|
(0.3
|
)%
|
Nondeductible items
|
|
(0.7
|
)%
|
|
(0.5
|
)%
|
|
0.7
|
%
|
Nondeductible interest and derivatives
|
|
(1.5
|
)%
|
|
(4.0
|
)%
|
|
—
|
%
|
Foreign rate differences
|
|
(1.8
|
)%
|
|
(2.2
|
)%
|
|
(3.7
|
)%
|
Change in statutory tax rates
|
|
—
|
%
|
|
—
|
%
|
|
1.4
|
%
|
Change in valuation allowance
|
|
(5.3
|
)%
|
|
(5.4
|
)%
|
|
(30.8
|
)%
|
Stock compensation
|
|
(1.2
|
)%
|
|
(5.6
|
)%
|
|
(0.1
|
)%
|
Executive compensation
|
|
(0.1
|
)%
|
|
(0.3
|
)%
|
|
—
|
%
|
Goodwill impairment
|
|
(10.7
|
)%
|
|
—
|
%
|
|
—
|
%
|
Subscription receivable
|
|
—
|
%
|
|
(1.2
|
)%
|
|
(1.3
|
)%
|
Other adjustments
|
|
(0.5
|
)%
|
|
(1.0
|
)%
|
|
(0.1
|
)%
|
Uncertain tax positions
|
|
—
|
%
|
|
(0.4
|
)%
|
|
0.2
|
%
|
Effective tax rate
|
|
0.3
|
%
|
|
(2.4
|
)%
|
|
1.0
|
%
|
|
|
As of
|
||||||
|
|
December 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Deferred tax assets:
|
|
|
|
|
||||
Net operating loss carryforwards
|
|
$
|
212,253
|
|
|
$
|
199,959
|
|
Deferred compensation
|
|
8,146
|
|
|
13,684
|
|
||
Tax credits
|
|
2,945
|
|
|
6,171
|
|
||
Deferred rent
|
|
—
|
|
|
3,976
|
|
||
Deferred revenues
|
|
5,095
|
|
|
2,764
|
|
||
Property and equipment
|
|
—
|
|
|
1,788
|
|
||
Goodwill
|
|
2,462
|
|
|
—
|
|
||
Tax contingencies
|
|
1,127
|
|
|
1,422
|
|
||
Accrued salaries and benefits
|
|
2,406
|
|
|
2,200
|
|
||
Capital leases
|
|
16,772
|
|
|
444
|
|
||
Allowance for doubtful accounts
|
|
453
|
|
|
334
|
|
||
Capital loss carryforwards
|
|
266
|
|
|
266
|
|
||
Litigation settlement
|
|
225
|
|
|
1,197
|
|
||
Other
|
|
2,409
|
|
|
1,105
|
|
||
Gross deferred tax assets
|
|
254,559
|
|
|
235,310
|
|
||
Valuation allowance
|
|
(219,607
|
)
|
|
(200,366
|
)
|
||
Net deferred tax assets
|
|
$
|
34,952
|
|
|
$
|
34,944
|
|
Deferred tax liabilities:
|
|
|
|
|
||||
Intangible assets
|
|
$
|
(15,202
|
)
|
|
$
|
(23,886
|
)
|
Goodwill
|
|
—
|
|
|
(9,987
|
)
|
||
Lease asset
|
|
(11,219
|
)
|
|
—
|
|
||
Property and equipment
|
|
(5,134
|
)
|
|
—
|
|
||
Subpart F income recapture
|
|
(1,224
|
)
|
|
(1,404
|
)
|
||
Outside basis difference
|
|
—
|
|
|
(152
|
)
|
||
Other
|
|
(86
|
)
|
|
(1,051
|
)
|
||
Total deferred tax liabilities
|
|
(32,865
|
)
|
|
(36,480
|
)
|
||
Net deferred tax asset (liability)
|
|
$
|
2,087
|
|
|
$
|
(1,536
|
)
|
|
|
As of
|
||||||
|
|
December 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Beginning Balance
|
|
$
|
200,366
|
|
|
$
|
181,334
|
|
Additions
|
|
19,832
|
|
|
19,356
|
|
||
Reductions
|
|
(591
|
)
|
|
(324
|
)
|
||
Ending Balance
|
|
$
|
219,607
|
|
|
$
|
200,366
|
|
|
|
As of December 31,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Beginning balance
|
|
$
|
2,560
|
|
|
$
|
2,508
|
|
|
$
|
3,608
|
|
Increase related to tax positions of prior years
|
|
14
|
|
|
167
|
|
|
81
|
|
|||
Increase related to tax positions of the current year
|
|
53
|
|
|
90
|
|
|
88
|
|
|||
Decrease related to tax positions of prior years
|
|
(84
|
)
|
|
(106
|
)
|
|
(1,064
|
)
|
|||
Decrease due to lapse in statutes of limitations
|
|
(143
|
)
|
|
(99
|
)
|
|
(205
|
)
|
|||
Ending balance
|
|
$
|
2,400
|
|
|
$
|
2,560
|
|
|
$
|
2,508
|
|
13.
|
Employee Benefit Plans
|
14.
|
Geographic Information
|
|
|
As of December 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
United States
|
|
$
|
30,556
|
|
|
$
|
25,456
|
|
Europe
|
|
841
|
|
|
1,415
|
|
||
Latin America
|
|
251
|
|
|
365
|
|
||
Other
|
|
45
|
|
|
103
|
|
||
Total
|
|
$
|
31,693
|
|
|
$
|
27,339
|
|
15.
|
Related Party Transactions
|
|
Years Ended December 31,
|
||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues (1)
|
$
|
15,858
|
|
|
$
|
11,610
|
|
|
$
|
13,181
|
|
|
|
|
|
|
|
||||||
Cost of revenues
|
10,455
|
|
|
11,077
|
|
|
12,956
|
|
|||
Selling and marketing
|
20
|
|
|
158
|
|
|
157
|
|
|||
Research and development
|
—
|
|
|
111
|
|
|
119
|
|
|||
General and administrative
|
539
|
|
|
99
|
|
|
115
|
|
|||
|
|
|
|
|
|
||||||
Interest income
|
—
|
|
|
343
|
|
|
672
|
|
|
|
As of December 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
|
||||
Accounts receivable, net
|
|
$
|
2,542
|
|
|
$
|
3,353
|
|
Prepaid expenses and other current assets
|
|
1,180
|
|
|
429
|
|
||
Liabilities
|
|
|
|
|
||||
Accounts payable
|
|
$
|
2,510
|
|
|
$
|
1,833
|
|
Accrued expenses
|
|
716
|
|
|
1,384
|
|
||
Contract liability
|
|
1,361
|
|
|
1,945
|
|
||
Other non-current liabilities
|
|
—
|
|
|
251
|
|
|
|
As of December 31,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Accrued expenses
|
|
$
|
6,120
|
|
|
$
|
3,046
|
|
Financing derivatives
|
|
21,587
|
|
|
26,100
|
|
||
Senior secured convertible notes
|
|
184,075
|
|
|
177,342
|
|
16.
|
Organizational Restructuring
|
(In thousands)
|
|
Severance pay and benefits
|
|
Other direct costs
|
|
Total
|
||||||
Restructuring expense
|
|
$
|
10,298
|
|
|
$
|
212
|
|
|
$
|
10,510
|
|
Payments
|
|
(1,340
|
)
|
|
—
|
|
|
(1,340
|
)
|
|||
Foreign exchange
|
|
14
|
|
|
—
|
|
|
14
|
|
|||
Accrued Balance as of December 31, 2017
|
|
$
|
8,972
|
|
|
$
|
212
|
|
|
$
|
9,184
|
|
Restructuring expense
|
|
1,275
|
|
|
—
|
|
|
1,275
|
|
|||
Payments
|
|
(10,180
|
)
|
|
—
|
|
|
(10,180
|
)
|
|||
Foreign exchange
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||
Accrued Balance as of December 31, 2018
|
|
$
|
66
|
|
|
$
|
212
|
|
|
$
|
278
|
|
Payments
|
|
(66
|
)
|
|
(212
|
)
|
|
(278
|
)
|
|||
Accrued Balance as of December 31, 2019
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(In thousands)
|
|
Severance pay and benefits
|
|
Short-term lease exit and other direct costs
|
|
Long-term lease exit and other direct costs
|
|
Total
|
||||||||
Restructuring expense(1)
|
|
$
|
7,145
|
|
|
$
|
1,271
|
|
|
$
|
1,847
|
|
|
$
|
10,263
|
|
Payments
|
|
(2,652
|
)
|
|
(561
|
)
|
|
(37
|
)
|
|
(3,250
|
)
|
||||
Foreign exchange
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||
Accrued Balance as of December 31, 2018
|
|
$
|
4,493
|
|
|
$
|
708
|
|
|
$
|
1,810
|
|
|
$
|
7,011
|
|
Adoption of ASC 842(2)
|
|
$
|
—
|
|
|
$
|
(708
|
)
|
|
$
|
(1,810
|
)
|
|
$
|
(2,518
|
)
|
Restructuring expense(3)
|
|
(2,195
|
)
|
|
—
|
|
|
—
|
|
|
(2,195
|
)
|
||||
Payments
|
|
(2,298
|
)
|
|
—
|
|
|
—
|
|
|
(2,298
|
)
|
||||
Accrued Balance as of December 31, 2019
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(In thousands)
|
|
May 2019 Restructuring Plan
|
|
August 2019 Restructuring Plan
|
||||
Severance pay and benefits related restructuring expense
|
|
3,141
|
|
|
2,454
|
|
||
Payments
|
|
(2,847
|
)
|
|
(1,756
|
)
|
||
Accrued Balance as of December 31, 2019
|
|
$
|
294
|
|
|
$
|
698
|
|
17.
|
Quarterly Financial Information (Unaudited)
|
|
|
2019
|
||||||||||||||
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
Revenues
|
|
$
|
102,294
|
|
|
$
|
96,888
|
|
|
$
|
94,300
|
|
|
$
|
95,163
|
|
Cost of revenues (1)
|
|
53,407
|
|
|
51,994
|
|
|
47,390
|
|
|
46,831
|
|
||||
Gross profit
|
|
48,887
|
|
|
44,894
|
|
|
46,910
|
|
|
48,332
|
|
||||
Selling and marketing (1)
|
|
24,840
|
|
|
23,329
|
|
|
20,421
|
|
|
20,555
|
|
||||
Research and development (1)
|
|
18,216
|
|
|
16,883
|
|
|
14,064
|
|
|
12,639
|
|
||||
General and administrative (1)
|
|
19,545
|
|
|
16,932
|
|
|
14,064
|
|
|
15,878
|
|
||||
Investigation and audit related
|
|
842
|
|
|
2,354
|
|
|
980
|
|
|
129
|
|
||||
Amortization of intangible assets
|
|
8,105
|
|
|
8,076
|
|
|
6,970
|
|
|
6,925
|
|
||||
Impairment of goodwill
|
|
—
|
|
|
224,272
|
|
|
—
|
|
|
—
|
|
||||
Impairment of intangible asset
|
|
—
|
|
|
17,308
|
|
|
—
|
|
|
—
|
|
||||
Settlement of litigation, net
|
|
—
|
|
|
5,000
|
|
|
(2,100
|
)
|
|
—
|
|
||||
Restructuring
|
|
(70
|
)
|
|
2,949
|
|
|
2,270
|
|
|
(1,886
|
)
|
||||
Total operating expenses
|
|
71,478
|
|
|
317,103
|
|
|
56,669
|
|
|
54,240
|
|
||||
Loss from operations
|
|
(22,591
|
)
|
|
(272,209
|
)
|
|
(9,759
|
)
|
|
(5,908
|
)
|
||||
Interest expense, net
|
|
(6,759
|
)
|
|
(8,242
|
)
|
|
(8,175
|
)
|
|
(8,350
|
)
|
||||
Other income (expense), net
|
|
2,969
|
|
|
(3,081
|
)
|
|
6,733
|
|
|
(4,967
|
)
|
||||
Gain (loss) from foreign currency transactions
|
|
38
|
|
|
(464
|
)
|
|
1,194
|
|
|
(432
|
)
|
||||
Loss before income taxes
|
|
(26,343
|
)
|
|
(283,996
|
)
|
|
(10,007
|
)
|
|
(19,657
|
)
|
||||
Income tax (provision) benefit
|
|
(1,171
|
)
|
|
4,463
|
|
|
(552
|
)
|
|
(1,733
|
)
|
||||
Net loss
|
|
$
|
(27,514
|
)
|
|
$
|
(279,533
|
)
|
|
$
|
(10,559
|
)
|
|
$
|
(21,390
|
)
|
Net loss per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
|
$
|
(0.46
|
)
|
|
$
|
(4.61
|
)
|
|
$
|
(0.16
|
)
|
|
$
|
(0.31
|
)
|
Weighted-average number of shares used in per share calculation - Common Stock:
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
|
59,958,203
|
|
|
60,697,608
|
|
|
64,157,167
|
|
|
69,644,437
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
(1) Amortization of stock-based compensation expense is included in the line items above as follows:
|
||||||||||||||||
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
Cost of revenues
|
|
$
|
848
|
|
|
$
|
636
|
|
|
$
|
396
|
|
|
$
|
(28
|
)
|
Selling and marketing
|
|
1,316
|
|
|
1,087
|
|
|
756
|
|
|
456
|
|
||||
Research and development
|
|
726
|
|
|
668
|
|
|
469
|
|
|
118
|
|
||||
General and administrative
|
|
4,063
|
|
|
1,913
|
|
|
1,392
|
|
|
1,879
|
|
||||
Restructuring
|
|
—
|
|
|
(266
|
)
|
|
129
|
|
|
—
|
|
||||
Total stock-based compensation expense
|
|
$
|
6,953
|
|
|
$
|
4,038
|
|
|
$
|
3,142
|
|
|
$
|
2,425
|
|
|
|
2018
|
||||||||||||||
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
Revenues
|
|
$
|
105,919
|
|
|
$
|
101,389
|
|
|
$
|
102,864
|
|
|
$
|
109,310
|
|
Cost of revenues (1)
|
|
47,254
|
|
|
51,526
|
|
|
49,446
|
|
|
51,994
|
|
||||
Gross profit
|
|
58,665
|
|
|
49,863
|
|
|
53,418
|
|
|
57,316
|
|
||||
Selling and marketing (1)
|
|
25,905
|
|
|
29,647
|
|
|
24,866
|
|
|
27,977
|
|
||||
Research and development (1)
|
|
18,716
|
|
|
20,889
|
|
|
18,742
|
|
|
18,632
|
|
||||
General and administrative (1)
|
|
18,661
|
|
|
28,699
|
|
|
18,707
|
|
|
18,468
|
|
||||
Investigation and audit related
|
|
31,867
|
|
|
4,883
|
|
|
696
|
|
|
892
|
|
||||
Amortization of intangible assets
|
|
8,544
|
|
|
8,266
|
|
|
7,896
|
|
|
8,158
|
|
||||
Settlement of litigation, net
|
|
—
|
|
|
5,250
|
|
|
—
|
|
|
—
|
|
||||
Restructuring
|
|
1,257
|
|
|
3,833
|
|
|
51
|
|
|
6,696
|
|
||||
Total operating expenses
|
|
104,950
|
|
|
101,467
|
|
|
70,958
|
|
|
80,823
|
|
||||
Loss from operations
|
|
(46,285
|
)
|
|
(51,604
|
)
|
|
(17,540
|
)
|
|
(23,507
|
)
|
||||
Interest expense, net
|
|
(2,905
|
)
|
|
(4,124
|
)
|
|
(4,682
|
)
|
|
(4,754
|
)
|
||||
Other income (expense), net
|
|
77
|
|
|
807
|
|
|
(1,711
|
)
|
|
(637
|
)
|
||||
(Loss) gain from foreign currency transactions
|
|
(922
|
)
|
|
1,045
|
|
|
(304
|
)
|
|
1,484
|
|
||||
Loss before income taxes
|
|
(50,035
|
)
|
|
(53,876
|
)
|
|
(24,237
|
)
|
|
(27,414
|
)
|
||||
Income tax (provision) benefit
|
|
(1,415
|
)
|
|
(2,101
|
)
|
|
(400
|
)
|
|
210
|
|
||||
Net loss
|
|
$
|
(51,450
|
)
|
|
$
|
(55,977
|
)
|
|
$
|
(24,637
|
)
|
|
$
|
(27,204
|
)
|
Net loss per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
|
$
|
(0.93
|
)
|
|
$
|
(1.02
|
)
|
|
$
|
(0.42
|
)
|
|
$
|
(0.46
|
)
|
Weighted-average number of shares used in per share calculation - Common Stock:
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
|
55,227,046
|
|
|
55,192,741
|
|
|
58,212,306
|
|
|
59,116,831
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
(1) Stock-based compensation expense is included in the line items above as follows:
|
||||||||||||||||
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
Cost of revenues
|
|
$
|
213
|
|
|
$
|
3,774
|
|
|
$
|
1,248
|
|
|
$
|
1,114
|
|
Selling and marketing
|
|
575
|
|
|
5,792
|
|
|
1,860
|
|
|
1,225
|
|
||||
Research and development
|
|
344
|
|
|
3,972
|
|
|
1,137
|
|
|
1,127
|
|
||||
General and administrative
|
|
749
|
|
|
9,461
|
|
|
2,066
|
|
|
2,494
|
|
||||
Restructuring
|
|
—
|
|
|
—
|
|
|
—
|
|
|
468
|
|
||||
Total stock-based compensation expense
|
|
$
|
1,881
|
|
|
$
|
22,999
|
|
|
$
|
6,311
|
|
|
$
|
6,428
|
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
•
|
Enhanced controls related to manual journal entries to strengthen the completeness and accuracy of revenue-related entries;
|
•
|
Enhanced controls, including new automated reports, to demonstrate and verify evidence of product or service delivery;
|
•
|
Enhanced communication between financial and operating personnel to better monitor the status of product and service delivery;
|
•
|
Centralized responsibility for product and service delivery under one department and implemented a monthly attestation process for key operating personnel;
|
•
|
Implemented mandatory training for operational and revenue personnel who are responsible for product or service delivery and revenue recognition;
|
•
|
Enhanced controls over unbilled revenue and deferred revenue account reconciliations, including the review and timely analysis of reconciling items; and
|
•
|
Implemented a business process review control that compares our actual results to our forecast and historical results.
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
|
EXHIBITS
|
|
Exhibit
No.
|
|
Exhibit
Document
|
|
|
|
3.1
|
|
|
|
|
|
3.2
|
|
|
|
|
|
3.3
|
|
|
|
|
|
3.4
|
|
|
|
|
|
3.5
|
|
|
|
|
|
4.1+
|
|
|
|
|
|
4.2+
|
|
|
|
|
|
4.3
|
|
|
|
|
|
4.4
|
|
|
|
|
|
4.5
|
|
|
|
|
|
4.6
|
|
|
|
|
|
4.7
|
|
|
|
|
|
4.8
|
|
|
|
|
|
4.9+
|
|
|
|
|
|
4.10
|
|
|
|
|
|
4.11
|
|
|
|
|
|
4.12
|
|
|
|
|
|
4.13
|
|
|
|
|
|
4.14
|
|
|
|
|
|
4.15
|
|
|
|
|
|
4.16
|
|
|
|
|
|
4.17
|
|
|
|
|
|
10.1
|
|
|
|
|
|
10.2
|
|
|
|
|
|
10.3
|
|
|
|
|
|
10.4
|
|
|
|
|
|
10.5
|
|
|
|
|
|
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*
|
|
|
|
|
|
10.26*
|
|
|
|
|
|
10.27*
|
|
|
|
|
|
10.28
|
|
|
|
|
|
10.29*
|
|
|
|
|
|
10.30*
|
|
|
|
|
|
10.31+*
|
|
|
|
|
|
10.32+*
|
|
|
|
|
|
10.33+*
|
|
|
|
|
|
10.34+*
|
|
|
|
|
|
10.35+*
|
|
|
|
|
|
10.36+*
|
|
|
|
|
|
21.1+
|
|
|
|
|
|
ITEM 16.
|
FORM 10-K SUMMARY
|
|
COMSCORE, INC.
|
|||
|
|
|
||
|
By:
|
/s/ William P. Livek
|
||
|
|
William P. Livek
|
||
|
|
Chief Executive Officer and Executive Vice Chairman
|
||
|
|
(Principal Executive Officer)
|
||
|
|
|
|
|
|
By:
|
/s/ Gregory A. Fink
|
||
|
|
Gregory A. Fink
|
||
|
|
Chief Financial Officer and Treasurer
|
||
|
|
(Principal Financial Officer and
Principal Accounting Officer)
|
Signature
|
|
Title
|
Date
|
|
|
|
|
/s/ William P. Livek
|
|
Chief Executive Officer and Executive Vice Chairman
|
February 27, 2020
|
William P. Livek
|
|
(Principal Executive Officer)
|
|
|
|
|
|
/s/ Gregory A. Fink
|
|
Chief Financial Officer and Treasurer
|
February 27, 2020
|
Gregory A. Fink
|
|
(Principal Financial Officer and
Principal Accounting Officer)
|
|
|
|
|
|
/s/ Brent D. Rosenthal
|
|
Non-Executive Chairman
|
February 27, 2020
|
Brent D. Rosenthal
|
|
|
|
|
|
|
|
/s/ Joanne Bradford
|
|
Director
|
February 27, 2020
|
Joanne Bradford
|
|
|
|
|
|
|
|
/s/ Irwin Gotlieb
|
|
Director
|
February 27, 2020
|
Irwin Gotlieb
|
|
|
|
|
|
|
|
/s/ Jacques Kerrest
|
|
Director
|
February 27, 2020
|
Jacques Kerrest
|
|
|
|
|
|
|
|
/s/ Kathleen Love
|
|
Director
|
February 27, 2020
|
Kathleen Love
|
|
|
|
|
|
|
|
/s/ John K. Martin Jr.
|
|
Director
|
February 27, 2020
|
John K. Martin Jr.
|
|
|
|
Issuance Date: January 16, 2018
|
Original Principal Amount: U.S. $[●]
|
|
|
|
|
2
|
|
|
3
|
|
|
4
|
|
|
5
|
|
|
6
|
|
|
7
|
|
|
8
|
|
|
9
|
|
|
10
|
|
|
11
|
|
|
12
|
|
|
13
|
|
|
14
|
|
|
15
|
|
|
16
|
|
|
17
|
|
|
18
|
|
|
19
|
|
|
20
|
|
|
21
|
|
|
22
|
|
|
23
|
|
|
24
|
|
|
25
|
|
|
26
|
|
|
27
|
|
|
28
|
|
|
29
|
|
|
30
|
|
|
31
|
|
|
32
|
|
|
33
|
|
|
34
|
|
|
35
|
|
|
36
|
|
|
37
|
|
|
38
|
|
|
39
|
|
|
40
|
|
|
41
|
|
|
42
|
|
|
43
|
|
If the Conversion Premium (as of January 30, 2018 for the second column and as of the applicable Interest Reset Date for the third column) is:
|
Then the Interest Rate (which shall be determined on January 30, 2018) from the Initial Issuance Date through the first Interest Reset Date shall be:
|
And the Interest Rate from the applicable Interest Reset Date until the next subsequent Interest Reset Date shall be:
|
1.0 or less
|
6.0%
|
4.0%
|
1.05
|
6.0%
|
4.3%
|
1.10
|
6.0%
|
4.7%
|
1.15
|
6.0%
|
5.0%
|
1.20
|
6.0%
|
5.3%
|
1.25
|
6.0%
|
5.7%
|
1.30
|
6.0%
|
6.0%
|
1.35
|
8.0%
|
8.0%
|
1.40
|
10.0%
|
10.0%
|
1.45 or higher
|
12.0%
|
12.0%
|
|
44
|
|
|
45
|
|
Change of Control Redemption Date
|
Make-Whole Stock Price
|
|||||||||
$20.00
|
$25.00
|
$28.50
|
$30.00
|
$35.00
|
$37.05
|
$40.00
|
$45.00
|
$50.00
|
$55.00
|
|
January 5, 2018
|
|
|
|
|
|
|
|
|
|
|
January 7, 2019
|
|
|
|
|
|
|
|
|
|
|
January 7, 2020
|
|
|
|
|
|
|
|
|
|
|
January 7, 2021
|
|
|
|
|
|
|
|
|
|
|
January 5, 2022
|
|
|
|
|
|
|
|
|
|
|
|
46
|
|
|
47
|
|
|
48
|
|
|
49
|
|
|
50
|
|
|
51
|
|
|
52
|
|
|
53
|
|
comScore, Inc.
|
By:
|
Name:
|
Title:
|
|
|
|
|
|
|
|
|
|
Date of Conversion:
|
|
||||||||||
Aggregate Conversion Amount to be converted:
|
|
||||||||||
Please confirm the following information:
|
|||||||||||
Conversion Price:
|
|
||||||||||
Number of shares of Common Stock to be issued:
|
|
||||||||||
Please issue the Common Stock into which the Note is being converted in the following name and to the following address:
|
|||||||||||
Issue to:
|
|
||||||||||
|
|
||||||||||
|
|
||||||||||
Facsimile Number and Electronic Mail:
|
|
||||||||||
Authorization:
|
|
||||||||||
By:
|
|
||||||||||
Title:
|
|
||||||||||
Dated:
|
|
||||||||||
Account Number:
|
|
||||||||||
(if electronic book entry transfer)
|
|
||||||||||
Transaction Code Number:
|
|
||||||||||
(if electronic book entry transfer)
|
|
|
|
|
comScore, Inc.
|
By:
|
Name:
|
Title:
|
|
|
|
|
|
|
|
2
|
|
|
3
|
|
|
4
|
|
|
5
|
|
|
6
|
|
|
7
|
|
|
8
|
|
|
9
|
|
|
10
|
|
|
11
|
|
|
12
|
|
|
13
|
|
|
14
|
|
|
15
|
|
(u)
|
rights issued in the Rights Offering (as defined in the Securities Purchase Agreement);
|
|
16
|
|
(v)
|
dividends, distributions, rights, options or warrants for which an adjustment to the Conversion Price is required pursuant to Section 6(a) or 6(b);
|
(w)
|
dividends or distributions paid exclusively in cash for which an adjustment to the Conversion Price is required pursuant to Section 6(d);
|
(x)
|
rights issued or otherwise distributed pursuant to a stockholder rights plan, except to the extent provided in Section 6(g);
|
(y)
|
Spin-Offs for which an adjustment to the Conversion Price is required pursuant to Section 6(c)(ii); and
|
(z)
|
a distribution solely pursuant to a Corporate Event, as to which the provisions set forth in Section 5 will apply,
|
|
17
|
|
|
18
|
|
|
19
|
|
|
20
|
|
|
21
|
|
|
22
|
|
|
23
|
|
|
24
|
|
|
25
|
|
|
26
|
|
|
27
|
|
|
28
|
|
|
29
|
|
|
30
|
|
|
31
|
|
|
32
|
|
|
33
|
|
|
34
|
|
|
35
|
|
|
36
|
|
|
37
|
|
|
38
|
|
|
39
|
|
|
40
|
|
|
41
|
|
|
42
|
|
|
43
|
|
|
44
|
|
1.45 or higher
|
12.0%
|
12.0%
|
|
45
|
|
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
Make-Whole Stock Price
|
||||||||||||||||||||||||||||||||||||||||||||||
Date
|
|
||||||||||||||||||||||||||||||||||||||||||||||
$
|
20.00
|
|
|
$
|
23.62
|
|
|
$
|
25.00
|
|
|
$
|
28.50
|
|
|
$
|
30.00
|
|
|
$
|
31.29
|
|
|
$
|
35.00
|
|
|
$
|
37.05
|
|
|
$
|
40.00
|
|
|
$
|
45.00
|
|
|
$
|
50.00
|
|
|
$
|
55.00
|
|
|
January 5, 2018
|
5.32
|
|
|
6.19
|
|
|
6.20
|
|
|
7.44
|
|
|
7.67
|
|
|
8.65
|
|
|
6.79
|
|
|
6.00
|
|
|
5.08
|
|
|
3.95
|
|
|
2.89
|
|
|
2.10
|
|
||||||||||||
January 7, 2019
|
4.21
|
|
|
5.10
|
|
|
5.21
|
|
|
6.49
|
|
|
7.15
|
|
|
7.71
|
|
|
5.87
|
|
|
5.10
|
|
|
4.23
|
|
|
3.17
|
|
|
2.26
|
|
|
1.62
|
|
||||||||||||
January 7, 2020
|
3.21
|
|
|
3.96
|
|
|
4.13
|
|
|
5.34
|
|
|
5.96
|
|
|
6.50
|
|
|
4.64
|
|
|
3.89
|
|
|
3.06
|
|
|
2.11
|
|
|
1.40
|
|
|
0.94
|
|
||||||||||||
January 7, 2021
|
2.37
|
|
|
2.82
|
|
|
3.01
|
|
|
4.06
|
|
|
4.60
|
|
|
5.07
|
|
|
3.09
|
|
|
2.28
|
|
|
1.36
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
||||||||||||
January 5, 2022
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
46
|
|
|
47
|
|
|
48
|
|
|
49
|
|
|
50
|
|
|
51
|
|
|
52
|
|
|
53
|
|
|
|
|
|
COMSCORE, INC.
|
|
|
|
|
|
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMSCORE, INC.
|
|
|
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
|
Exhibit 4.9
|
|
|
Exhibit 4.9
|
•
|
acquisition of us by means of a tender offer;
|
•
|
acquisition of us by means of a proxy contest or otherwise; or
|
•
|
removal of our incumbent officers and directors
|
•
|
Undesignated Preferred Stock. The ability to authorize undesignated preferred stock makes it possible for our board of directors to issue one or more series of preferred stock with voting or other rights or preferences that could impede the success of any attempt to change control of the company. These and other provisions may have the effect of deferring hostile takeovers or delaying changes in control or management of us.
|
|
|
Exhibit 4.9
|
•
|
Stockholder Meetings. Our charter documents provide that a special meeting of stockholders may be called only by resolution adopted by the board of directors, the chairman of the board of directors or the chief executive officer.
|
•
|
Requirements for Advance Notification of Stockholder Nominations and Proposals. Our bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of the board of directors or a committee of the board of directors.
|
•
|
Board Classification. Our board of directors is divided into three classes. The directors in each class serve for a three-year term, one class being elected each year by our stockholders. This system of electing and removing directors may tend to discourage a third party from making a tender offer or otherwise attempting to obtain control of us, because it generally makes it more difficult for stockholders to replace a majority of the directors.
|
•
|
Limits on Ability of Stockholders to Act by Written Consent. We have provided in our certificate of incorporation that our stockholders may not act by written consent. This limit on the ability of our stockholders to act by written consent may lengthen the amount of time required to take stockholder actions. As a result, a holder controlling a majority of our capital stock would not be able to amend our bylaws or remove directors without holding a meeting of our stockholders called in accordance with our bylaws.
|
•
|
Amendment of Certificate of Incorporation and Bylaws. The amendment of the above provisions of our amended and restated certificate of incorporation and bylaws requires approval by holders of at least two-thirds of our outstanding capital stock entitled to vote generally in the election of directors.
|
•
|
before such date, the board of directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder;
|
•
|
upon completion of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction began, excluding for purposes of determining the voting stock outstanding (but not the outstanding voting stock owned by the interested stockholder) those shares owned (i) by persons who are directors and also officers and (ii) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
|
•
|
on or after such date, the business combination is approved by the board of directors and authorized at an annual or special meeting of the stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder.
|
•
|
any merger or consolidation involving the corporation and the interested stockholder;
|
•
|
any sale, lease, exchange, mortgage, transfer, pledge or other disposition of 10% or more of either the assets or outstanding stock of the corporation involving the interested stockholder;
|
•
|
subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;
|
|
|
Exhibit 4.9
|
•
|
any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; or
|
•
|
the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits by or through the corporation.
|
|
|
Exhibit 10.31
|
|
|
Exhibit 10.31
|
a.
|
The Company will continue to pay Executive his annual base salary of $375,000.00 less applicable taxes and withholdings as required by law (“Severance Payments”), in accordance with the Company’s current normal payroll cycle, beginning on the first pay period after the Separation Date and continuing for a period of 12 months, unless Executive has materially breached any provision of this Agreement.
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b.
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The Company will pay Executive for all accrued salary and all accrued and unused paid time off earned through the Separation Date, subject to standard payroll deductions and withholdings, on the Company’s ordinary payroll date next-following the Separation Date.
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c.
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The Company agrees that Executive will be eligible to receive an annual bonus in connection with the Short-Term Incentive Plan, if any such bonus is awarded, at the same rate and at the same time as is awarded to other similarly situated executives.
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d.
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Executive’s health insurance will terminate on the last day of the month in which the Separation Date occurs. If eligible, Executive may thereafter elect to continue Executive’s health benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) or state insurance laws, if applicable, at Executive’s own expense (or, if Executive enters into this Agreement, at the Company’s expense as provided in paragraph 2(g) below). Notice of Executive’s COBRA rights will be sent to Executive under separate cover. Executive’s rights to elect such coverage are not contingent upon his entering into this Agreement.
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e.
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Executive agrees that, within 10 days following the Separation Date, Executive will submit Executive’s final documented expense reimbursement statement reflecting all business expenses he incurred through the Separation Date, if any, for which Executive seeks reimbursement. The Company will reimburse Executive for these expenses pursuant to its regular business practice.
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f.
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If Executive elects continuation coverage pursuant to COBRA within the period prescribed pursuant to COBRA for Executive and Executive’s eligible
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Exhibit 10.31
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g.
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Executive expressly understands and acknowledges that the Company agrees to provide the above-stated payments and benefits in parts (a), (c) and (f) of this Paragraph 2 in exchange for Executive’s compliance with the terms set out in this Agreement. Executive further acknowledges and agrees that he is not entitled to receive payment of any of the benefits set forth in parts (a), (c), or (f) of this Paragraph 2 absent execution of this Agreement. Executive understands and agrees that the Company shall not provide any of the consideration set forth in this Agreement (including without limitation the payments or additional benefits listed in this Paragraph 2) until after the Separation Date. If Executive materially fails to comply with any of his obligations under this Agreement during the term for payment described above, Executive understands and acknowledges that the Company may cease making any of the above described payments and benefits. Executive also acknowledges that if any payments are made to him under the terms of this Agreement, but are suspended as a result of a material breach by Executive of any provision of this Agreement, including but not limited to his continuing obligations under Paragraphs 6, 7, 8 and 18, then the payments made to Executive are satisfactory and adequate consideration for the covenants and releases made by Executive herein.
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Exhibit 10.31
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Exhibit 10.31
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Exhibit 10.31
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Exhibit 10.31
|
a.
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Executive has been and is advised to consult an attorney regarding this Agreement prior to executing it and that he has been given sufficient time to do so;
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b.
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Executive has received full and adequate consideration for this Agreement, including the waiver and release herein; and
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c.
|
Executive fully understands and acknowledges the significance and consequences of this Agreement and represents by his signature that the terms of this Agreement are fully understood and voluntarily accepted by him. This Agreement has been individually negotiated by Executive and is not part of a group exit incentive or other group employment termination program.
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Exhibit 10.31
|
To Company:
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comScore, Inc.
Attention: General Counsel
11950 Democracy Drive, Suite 600
Reston, VA 20190
|
To Executive:
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Joseph Rostock
______________________
______________________
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|
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Exhibit 10.31
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Exhibit 10.31
|
November 5, 2019
|
COMPANY:
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COMSCORE, INC.
|
||
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|
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Carol DiBattiste
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|
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General Counsel & Chief Compliance, Privacy and People Officer
|
||
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|||
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|
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|
|
|
|
EXECUTIVE:
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|
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|
|
|
|
|
|
Joseph Rostock
|
|
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|
Exhibit 10.31
|
|
|
Exhibit 10.31
|
|
|
Exhibit 10.31
|
|
|
Exhibit 10.31
|
|
|
Exhibit 10.31
|
3.
|
Satisfaction of Severance Obligations; Receipt of Leaves, Bonuses, and Other Compensation. Executive acknowledges and agrees that, with the exception of any base salary earned by him in the pay period that immediately preceded the Separation Date (if such base salary has not been paid as of the time that Executive executes this Confirming Release), any reasonable business expenses incurred by Executive in accordance with the Company’s applicable procedures and policies regarding reimbursable business expenses for which he has not been reimbursed prior to the Separation date, and any sums to which he may be entitled following the date that he signs this Confirming Release pursuant to Section 2(a), (c), and (e) of the Separation Agreement, he has been paid in full all bonuses, been provided all benefits, and otherwise received all wages, compensation, and other sums that he has been owed by each Confirming Released Party. Executive further acknowledges and agrees that he has received or has waived all leaves (paid and unpaid) that he has been entitled to receive from each Confirming Released Party.
|
|
|
Exhibit 10.31
|
6.
|
Return of Property. Executive represents and warrants that Executive has returned to the Company all property belonging to the Company or any other Released Party, including all documents, computer files and other electronically stored information, client materials and other materials provided to Executive by the Company or any other Released Party in the course of his employment, and Executive further represents and warrants that Executive has not maintained a copy of any such materials in any form.
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|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
|
|
Exhibit 10.32
|
COMPANY
|
|
COMSCORE, INC.
|
||
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
|
|
|
Name:
|
Christiana Lin
|
|
|
|
Title:
|
EVP, General Counsel Chief Privacy Officer
|
|
|
|
Date:
|
September 28, 2015
|
|
|
|
|
|
|
EXECUTIVE
|
|
By:
|
|
|
|
|
Name:
|
William Livek
|
|
|
|
Date:
|
September 28, 2015
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.33
|
|
|
Exhibit 10.34
|
|
|
Exhibit 10.34
|
|
|
Exhibit 10.34
|
|
|
Exhibit 10.34
|
|
|
Exhibit 10.34
|
|
|
Exhibit 10.34
|
|
|
Exhibit 10.35
|
Stock-Price Hurdle
|
Percentage of PRSUs That Vest
|
[●]
|
[●]
|
|
|
Exhibit 10.36
|
/s/ William P. Livek
|
William P. Livek
|
Chief Executive Officer
|
(Principal Executive Officer)
|
/s/ Gregory A. Fink
|
Gregory A. Fink
|
Chief Financial Officer and Treasurer
|
(Principal Financial Officer)
|
/s/ William P. Livek
|
William P. Livek
|
Chief Executive Officer
|
(Principal Executive Officer)
|
/s/ Gregory A. Fink
|
Gregory A. Fink
|
Chief Financial Officer and Treasurer
|
(Principal Financial Officer)
|