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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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42-1709682
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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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 $0.005 per share
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ONDK
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New York Stock Exchange
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Large accelerated filer
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Accelerated filer
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x
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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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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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¨
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Page
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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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Tailored Solutions. We offer small businesses a suite of financing choices with our term loans and lines of credit that we believe can be tailored to effectively address small businesses' particular funding needs. We believe that small businesses prefer to work with providers with whom they can build long-term relationships and that the range of our offerings makes us an ideal lending partner. Our term loans are available from $5,000 up to $500,000 with maturities of three to 36 months and our lines of credit range from $6,000 to $100,000 and substantially all are repayable within twelve months of the date of most recent draw. We believe this provides a wider range of term lengths, pricing alternatives and repayment options than any other online small business lender. We also report customer performance to several business credit bureaus, which can help small businesses build their business credit.
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Simple. Small businesses can submit an application on our website in as little as minutes. We are able to provide many loan applicants with an immediate decision and, if approved, fund as fast as 24 hours. Because we require no in-person meetings, collect comprehensive information electronically and have an intuitive online application form, we have been able to significantly increase the convenience and efficiency of the application process without burdensome documentation requirements.
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Human. Being “human” is about understanding our customers and treating them with respect. We employ a hybrid approach to deliver a "human" experience, where people and technology complement one another. Our internal sales force and customer service representatives provide assistance throughout the application process and the life of the loan. Our U.S-based representatives support customers in the U.S., and currently also Canada, and our separate Sydney-based representatives support customers in Australia. Our representatives are available Monday through Saturday before, during and after regular business hours to accommodate the busy schedules of small business owners. Our website enables our customers to complete the loan application process online, but they may also elect to mail, fax or securely email us their application and related documentation. We believe that our inclusion of the human element differentiates us from many digital lenders that attempt to complete transactions with no human interaction as well as from banks that, we believe, have a poor history of customer service and satisfaction.
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Through our direct marketing channel, we make contact with prospective customers utilizing direct mail, outbound calling, social media and other online marketing.
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In our strategic partner channel, we enter into agreements with third parties that serve or otherwise have access to the small business community, who then introduce us to prospective customers. Strategic partners include, among others, small business-focused service providers, other financial institutions, financial and accounting solution providers, payment processors, independent sales organizations and other websites. Strategic partners conduct their own marketing activities which may include email marketing, leveraging existing business relationships and direct mail. Our business development team is dedicated to expanding our network of strategic partners and leveraging their relationships with small businesses to acquire new customers. In general, if a strategic partner refers a customer that takes a loan from us, we pay that strategic partner a referral fee based on the amount of the originated loan. Strategic partners differ from
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•
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Through our funding advisor program, we make contact with prospective customers by entering into relationships with third party independent advisors, known as funding advisor program partners, or FAPs, that typically offer a variety of financial services to small businesses. FAPs conduct their own marketing activities, which may include direct mail, online marketing, paid leads, television and radio advertising or leveraging existing business relationships. FAPs include independent sales organizations, commercial loan brokers and equipment leasing firms. FAPs act as intermediaries between potential customers and lenders by brokering business loans on behalf of potential customers. As part of our FAP strategy, we require a detailed certification process, including background checks, to approve a FAP, and annual recertifications in order to remain a FAP. We also employ a senior compliance officer whose responsibilities include overseeing compliance matters involving our funding advisor program channel. Our relationships with FAPs provide for the payment of a commission at the time the term loan is originated or for line of credit accounts when it is opened or on draw amounts. We generally do not recover these commissions upon default of a loan. As of December 31, 2019, we had active relationships with approximately 400 FAPs, and in 2019, 2018 and 2017, no single FAP was associated with more than 2.8%, 2.0%, and 1.7% of our total originations, respectively.
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Singular Focus and Visibility. We are passionate about small businesses. Since we began lending in 2007, we have focused exclusively on assessing and delivering credit to small businesses. We believe this passion, focus and small business credit expertise provides us with significant competitive advantages, including deep insight into small businesses and their financing needs. Our partnerships with well-known companies such as PNC Bank, National Association, or PNC, Intuit Inc., Investors Bank and others also help increase our visibility and validate our brand.
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Scale. We have originated over $13 billion in loans across more than 700 industries since we made our first loan in 2007. We believe our extensive experience and significant scale allow us to obtain and analyze large and growing amounts of data, which provides us with greater insight to identify, understand and meet the needs of our customers and prospective customers as well as better manage our business. We listed on the NYSE in December 2014 and have consistently met their high standards of transparency, governance, financial reporting and other requirements. We believe this differentiates us from non-listed small business lenders.
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Diversified Distribution Channels. We have established distribution capabilities through diversified channels, including direct marketing, strategic partnerships and funding advisors. Having multiple distribution channels enables us to optimize our targeting efforts and resource allocation in response to fluctuations in customer demand and marketing costs and the overall competitive landscape by channel. Moreover, each channel provides its own set of complimentary benefits. Our direct marketing includes direct mail, outbound calling, social media and other online marketing, enhances brand awareness and fosters customer retention and loyalty. Our strategic partners, including small business-focused service providers, payment processors, and other financial institutions, offer us access to their base of small business customers and data that can be used to enhance our targeting capabilities. Our relationships with a large network of funding advisors, including businesses that provide loan brokerage services, expand our reach in identifying and serving more customers and aid brand awareness.
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Proprietary Small Business Credit Evaluation. We use data, analytics and technology to optimize our business operations and the customer experience. Our loan decision process, including our proprietary OnDeck Score, provide us with significant visibility and predictability to assess the creditworthiness of small businesses and allow us to better serve more customers across more industries. With each loan application, each originated loan and each payment received, our dataset expands and our loan decision process improves. We are able to lend to more small businesses than if we relied on personal credit scores alone. We are also able to use our proprietary data and analytics engine to pre-qualify customers and market to those customers we believe are predisposed to take a loan and have a higher likelihood of approval. When we believe it is warranted, we may also utilize our hybrid approach which utilizes our online platform together with our judgmental underwriting to help tailor the right financial solution for our customers. We believe that our technology and decisioning process allow us to more quickly and dynamically make credit adjustments in changing environments compared to certain smaller or less experienced lenders.
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End-to-End Integrated Technology Platform. We built our integrated platform specifically to meet the financing needs of small businesses. Our platform touches every aspect of the customer life cycle, including customer acquisition, sales, scoring and underwriting, funding, and servicing and collections. This purpose-built infrastructure is enhanced by robust fraud protection, multiple layers of security and proprietary application programming interfaces. It enables us to deliver a superior customer experience and facilitates agile decision making.
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High Customer Satisfaction and Repeat Customer Base. Our strong value proposition has been validated by our customers. We achieved an overall Net Promoter Score of 80 for the year ended December 31, 2019 based on our internal survey of U.S. customers in all three of our distribution channels. The Net Promoter Score is a widely used index ranging from negative 100 to positive 100 that measures customer loyalty. Our score places us at the upper end of customer satisfaction ratings and compares favorably to the average Net Promoter Score of 34 for the financial services industry. We have also consistently achieved an A+ rating from the Better Business Bureau. We believe that high customer satisfaction has played an important role in repeat borrowing by our customers. In 2019, 2018, and 2017, 53%, 52% and 52%, respectively, of loan originations were by repeat term loan customers, who either replaced their existing term loan with a new, usually larger, term loan or took out a new term loan after paying off their existing OnDeck term loan in full. Repeat customers generally demonstrate improvements in key metrics such as revenue and bank balance when they return for an additional loan. Approximately 30% of renewals in 2019 represented the rollover of remaining balances and the remainder was incremental borrowings.
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Durable Business Model. Since we began lending in 2007, we have successfully operated our business through both strong and weak economic environments. The diversity of our portfolio including loans to over 114,000 small businesses in over 700 industries reduces sensitivity to industry or geographically specific downturns or events. Our real-time data, short duration loans, automated daily and weekly collections, risk management capabilities and unit economics enable us to react rapidly to changing market conditions.
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Expand in Each of our Distribution Channels and Optimize our Funnel. We plan to continue efficient investment in direct marketing to increase our brand awareness and add new customers. As our dataset expands, we will continue to pre-qualify and market to those customers we believe are predisposed to take a loan and have a higher likelihood of approval. We have seen success from this strategy as the direct marketing channel continued to originate more dollar volume than any other channel in 2019. We also intend to grow originations by broadening our indirect distribution capabilities through expanding our strategic partner and funding advisor networks. Our strategic partner channel offers our lowest customer acquisition cost while enhancements to our funding advisor network has led to increased application volume and conversion rates. We regularly seek to improve our efficiency in attracting new and repeat customers to apply for loans from us, to increase the number of completed loan applications and improve the conversion rate of completed applications into funded loans for qualified small businesses. This includes many aspects of our business from marketing, sales and customer support, underwriting, funding and servicing. By optimizing our sales funnel, we seek to reduce customer acquisition costs, responsibly increase loan originations and improve profitability.
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Continue to Optimize Decisioning Models. We continually update our decisioning models based on additional data and use that information to refine and optimize our marketing and lending decisions. For example, during 2019 as in prior years, in the ordinary course of business, we conducted numerous underwriting tests of discreet pools of loans with defined characteristics to assess the profitability of the sample. Testing included specific sectors, credit profiles and loan terms. We incorporate the learnings from these tests, both positive and negative, into our underwriting which we believe will lead to increased originations and profitability.
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Expand Loan Offerings and Features. We will continue to develop financing solutions and enhancements for underserved small businesses throughout their life cycle. We offer lines of credit with limits up to $100,000 and term loans up to $500,000 with terms up to 36-months. In 2019, we began to offer equipment finance loans and, in Canada only, a variable pay product. We regularly evaluate and explore new ideas including variations of existing loans through test pilot programs before new loans or loan enhancements are fully introduced. We believe expanded offerings and features will help retain existing customers, attract new customers and ultimately increase customer lifetime value.
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Scale International Businesses to Profitability. We continue to grow our business in both Canada and Australia where we believe the markets for online small business loans are still relatively new and underserved. On April 1, 2019, we combined our Canadian business with Evolocity Financial Group, or Evolocity, which helped us accelerate the growth of our Canadian operations. We will continue to grow efficiencies in Canada and Australia to help scale our international
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Grow ODX. We believe the opportunity exists to further expand ODX, which offers bank clients a comprehensive technology and services platform to facilitate online lending to their small business customers. Our customers use ODX services to support the origination and underwriting processes for a portion of their small business customers. We intend to work with our existing bank clients to increase the volume and scope of our business together and are actively seeking to expand the ODX customer base to include other banks and small business lenders.
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Extend Customer Lifetime Value. We believe we have an opportunity to increase revenue and loyalty from new and existing customers, thereby extending customer lifetime value. We continue to add benefits to our customer offerings to increase engagement and usage of our platform. In 2019, we began to offer equipment finance loans which we offer to both new and existing customers to help then with a lending solution to match their needs.
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Competitive Risks including threat of new and existing market entrants.
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Regulatory Risks. Regulatory risk involves regularly reviewing the legal and regulatory environment to ensure compliance with existing laws and anticipate future legal or regulatory changes that may impact us.
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Operational Risks including: (1) ensuring our IT systems, security protocols and business continuity plans are maintained, reviewed and tested; (2) establishing and testing internal controls with respect to financial reporting; (3) recruiting and retaining talent and (4) other risks associated with developing and executing business strategies.
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Liquidity and Market Risks. Liquidity risk is the risk that we will not maintain adequate financial resources to meet our financial obligations. We mitigate liquidity risk by using a funding strategy that allows us to access debt facilities and the securitization markets through a diverse set of banks, insurance companies and other institutional lenders, which reduces our dependence on any one source of capital. Market risks relate to potential implications of fluctuating interest rate or currency exchange rates on our operations or financial results. Liquidity and market risks are monitored by an asset liability committee.
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One Team
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We know that the best outcomes happen when we work together.
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Switched On
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We are passionate about small businesses, our company, and each other.
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Driven to Win
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Every decision counts in our journey to lend responsibly and win with integrity.
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Focused Innovation
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We invent where it differentiates us and leverage existing solutions where it doesn't.
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Strike the Right Balance
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Our entrepreneurial culture keeps us nimble and standards and processes keep us well-managed.
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•
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customer experience, including:
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◦
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customer service;
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transparent description of key terms;
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ease of process to apply for a loan;
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effectiveness of operational processes;
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speed of funding.
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brand recognition and trust;
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loan features, including amount, rate, term and repayment method; and
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effectiveness of customer acquisition.
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Item 1A.
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Risk Factors
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marketing, including expenses relating to increased direct marketing efforts;
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expanding product offerings;
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product development, including the continued development of our platform and OnDeck Score;
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technology and analytics, including through ODX;
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diversification of funding sources;
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broadening distribution capabilities through strategic partnerships and funding advisors;
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general administration, including legal, accounting and other compliance expenses related to being a public company and no longer being an emerging growth company after 2019; and
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expansion in Canada and Australia, and possibly into new international geographies.
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increase the number and total volume of loans we extend to our customers;
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improve the terms on which we lend to our customers as our business becomes more efficient;
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increase the effectiveness of our direct marketing, as well as our strategic partner and funding advisor program customer acquisition channels;
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maintain or increase repeat borrowing by existing customers;
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successfully develop and deploy new types of loans and new loan features including equipment finance loans;
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successfully expand ODX, our comprehensive technology and services platform that facilitates online lending to small business customers, to additional banks and other small business lenders;
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successfully maintain our diversified funding strategy, including through debt warehouse facilities and possible future securitization transactions;
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favorably compete with other companies, including traditional lenders and so-called “closed-loop" lenders, that are currently in, or may in the future enter, the business of lending to small businesses;
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successfully navigate economic conditions and fluctuations in the credit market;
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effectively manage the growth of our business;
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obtain debt or equity capital on attractive terms;
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successfully expand internationally; and
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anticipate and react to changes in an evolving regulatory environment.
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lack of acceptance of our platform through ODX by other lenders;
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reluctance of other lenders to share their customer data with us, or impacts of data and security breaches if they do;
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unwillingness of other lenders to use our platform through ODX because we are doing business with their competitors, or for other reasons;
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the possible preference of other lenders to build and use their own platforms, or platforms offered by existing or new competitors of ours, for online small business lending;
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our ability to charge fees for services commensurate with the total cost of providing those services;
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the amount of time it may take us to integrate new lenders;
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our ability to fund investment to expand and customize our platform in advance of earning fee revenue related to that investment;
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our ability to provide customized solutions that meet the needs of lenders;
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our ability to meet the performance criteria that customers or prospective customers require;
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the inability to retain one or more customers and the impact of that customer loss on other existing or prospective customers;
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our ability to scale our platform through ODX to make it economically viable; and
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our ability to compete effectively with third parties seeking to provide similar services.
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adjusting our proprietary loan platform, and our loan decisioning process, to account for the country-specific differences in information available on potential small business borrowers;
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conformity with applicable business customs, including translation into foreign languages and associated expenses;
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changes to the way we do business as compared with our current operations;
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the need to support and integrate with local third-party service providers;
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competition with service providers that have greater experience in the local markets than we do or that have pre-existing relationships with potential borrowers and investors in those markets;
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difficulties in staffing and managing foreign operations in an environment of diverse culture, laws and customs, and the increased travel, infrastructure and legal and compliance costs associated with international operations;
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difficulties in securing financing in international markets in local currencies;
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compliance with multiple, potentially conflicting and changing governmental laws and regulations, including banking, securities, employment, tax, privacy and data protection laws and regulations;
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compliance with U.S. and foreign anti-bribery laws, such as the Foreign Corrupt Practices Act and comparable laws in Canada, Australia and other non-U.S. markets into which we might expand in the future;
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difficulties in collecting payments in foreign currencies and associated foreign currency exposure;
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restrictions on repatriation of earnings;
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compliance with potentially conflicting and changing laws of taxing jurisdictions where we conduct business and applicable U.S. tax laws as they relate to international operations, the complexity and adverse consequences of such tax laws and potentially adverse tax consequences due to changes in such tax laws; and
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regional economic and political conditions.
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diversion of management time and focus from operating our business to addressing acquisition integration challenges;
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coordination of technology, product development and sales and marketing functions;
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transition of the acquired company’s customers to our platform;
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retention of employees from the acquired company, and retention of employees from OnDeck who were attracted to OnDeck because of its smaller size or for other reasons;
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cultural challenges associated with integrating employees from the acquired company into our organization;
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integration of the acquired company’s accounting, management information, human resources and other administrative systems;
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the need to implement or improve controls, procedures and policies at a business that prior to the acquisition may have lacked effective controls, procedures and policies;
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potential write-offs of loans or intangibles or other assets acquired in such transactions that may have an adverse effect our operating results in a given period;
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liability for activities of the acquired company before the acquisition, including patent and trademark infringement claims, violations of laws, commercial disputes, tax liabilities and other known and unknown liabilities; and
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litigation or other claims in connection with the acquired company, including claims from terminated employees, customers, former stockholders or other third parties.
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our inability to scale our equipment finance offering;
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our inability to effectively underwrite and price equipment finance transactions, and evaluate the initial and residual value of the loan collateral;
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our failure to develop or acquire the technology needed to support the offering of equipment finance loans;
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inadequately training sales and customer service personnel to handle the offering of equipment finance loans;
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customer acceptance;
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intense competition from other equipment finance providers, many of whom have much more experience and greater financial resources than we do, and risks of innovation by our competitors;
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actual losses exceeding expected losses for the offering of equipment finance loans;
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worsening economic conditions that may result in decreased demand and increase our customers' default rates;
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the effectiveness of our risk management efforts; and
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repossessing equipment collateral and liquidating it, including possible reputational and publicity risks associated with our collection efforts.
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convert potential clients in its pipeline into actual clients (and even if they become actual clients, it could be more time consuming and expensive to do so);
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retain an existing client;
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attract potential clients willing to consider ODX’s solutions;
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attract and/or to retain qualified employees necessary to support ODX’s business and growth plans and/ or remain competitive.
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announcements of new types of loans, services or technologies, relationships with strategic partners, acquisitions or other events by us or our competitors;
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changes in economic conditions;
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changes in prevailing interest rates;
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price and volume fluctuations in the overall stock market from time to time;
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significant volatility in the market price and trading volume of technology companies in general and of companies in our industry;
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fluctuations in the trading volume of our shares or the size of our public float;
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the impact of securities analysts’ reports or other publicity regarding our business or industry;
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actual or anticipated changes in our operating results or fluctuations in our operating results;
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quarterly fluctuations in demand for our loans;
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whether our operating results meet the expectations of securities analysts or investors;
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actual or anticipated changes in the expectations of investors or securities analysts;
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regulatory developments in the United States, foreign countries or both;
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major catastrophic events;
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sales of large blocks of our stock; or
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departures of key personnel.
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a classified board of directors with three-year staggered terms, which could delay the ability of stockholders to change the membership of a majority of our board of directors;
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the ability of our board of directors to issue shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquiror;
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the exclusive right of our board of directors to elect a director to fill a vacancy created by the expansion of our board of directors or the resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors;
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a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of our stockholders;
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the requirement that a special meeting of stockholders may be called only by the chairman of our board of directors, our president, our secretary or a majority vote of our board of directors, which could delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors;
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the requirement for the affirmative vote of holders of at least 66 2/3% of the voting power of all of the then outstanding shares of the voting stock, voting together as a single class, to amend the provisions of our amended and restated certificate of incorporation relating to the issuance of preferred stock and management of our business or our amended and restated bylaws, which may inhibit the ability of an acquiror to effect such amendments to facilitate an unsolicited takeover attempt;
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the ability of our board of directors, by majority vote, to amend the bylaws, which may allow our board of directors to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquiror to amend the bylaws to facilitate an unsolicited takeover attempt; and
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advance notice procedures with which stockholders must comply to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or otherwise attempting to obtain control of us.
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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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Location
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Purpose
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Approximate
Square Feet
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New York, NY
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Corporate Headquarters, technology and direct sales
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80,700
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Denver, CO
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Direct sales and operations
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44,400
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Arlington, VA
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Underwriting, loan origination and technology
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19,100
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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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Period
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Total Number of Shares Purchased
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Average Price Paid Per Share
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Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
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Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
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||||
October 1 - October 31, 2019
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1,737,602
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$4.11
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1,737,602
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$
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31,839,324
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November 1 - November 30, 2019
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4,786,158
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$4.57
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4,786,158
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$
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9,976,745
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December 1 - December 31, 2019
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966,334
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$4.10
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966,334
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$
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6,014,910
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Total
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7,490,094
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$4.40
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7,490,094
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(1)
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On July 29, 2019 we announced that our Board of Directors had authorized the repurchase of up to $50 million of our common stock with the repurchased shares to be retained as treasury stock and available for possible reissuance. This initial repurchase authorization expires August 31, 2020. Shares may be repurchased in open market transactions, in privately negotiated transactions or otherwise. Subsequent to December 31, 2019, our Board of Directors authorized additional repurchases under our repurchase program. See Note 16 of Notes to Consolidated Financial Statements.
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Item 6.
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Selected Consolidated Financial Data
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2019
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2018
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2017
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2016
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2015
|
||||||||||
Consolidated Statements of Operations Data
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest and finance income
|
$
|
428,423
|
|
|
$
|
382,944
|
|
|
$
|
334,040
|
|
|
$
|
264,411
|
|
|
$
|
194,890
|
|
Net interest income
|
383,753
|
|
|
335,869
|
|
|
287,841
|
|
|
231,549
|
|
|
174,340
|
|
|||||
Total operating expense
|
206,325
|
|
|
177,490
|
|
|
166,170
|
|
|
193,974
|
|
|
161,585
|
|
|||||
Income (loss) from operations, before provision for income taxes
|
20,122
|
|
|
24,635
|
|
|
(14,880
|
)
|
|
(85,915
|
)
|
|
(2,389
|
)
|
|||||
Net income (loss) attributable to On Deck Capital, Inc. common stockholders
|
$
|
27,955
|
|
|
$
|
27,046
|
|
|
$
|
(12,069
|
)
|
|
$
|
(83,391
|
)
|
|
$
|
(1,431
|
)
|
Net income (loss) per share attributable to On Deck Capital, Inc. common stockholders:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
0.38
|
|
|
$
|
0.36
|
|
|
$
|
(0.17
|
)
|
|
$
|
(1.18
|
)
|
|
$
|
(0.02
|
)
|
Diluted
|
$
|
0.36
|
|
|
$
|
0.34
|
|
|
$
|
(0.17
|
)
|
|
$
|
(1.18
|
)
|
|
$
|
(0.02
|
)
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
74,148,387
|
|
|
74,561,019
|
|
|
72,890,313
|
|
|
70,934,937
|
|
|
69,545,238
|
|
|||||
Diluted
|
76,963,749
|
|
|
78,549,940
|
|
|
72,890,313
|
|
|
70,934,937
|
|
|
69,545,238
|
|
|||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
56,344
|
|
|
$
|
59,859
|
|
|
$
|
71,362
|
|
|
$
|
79,554
|
|
|
$
|
159,822
|
|
Loans and finance receivables
|
1,265,312
|
|
|
1,169,407
|
|
|
952,982
|
|
|
1,000,628
|
|
|
552,791
|
|
|||||
Total assets
|
1,304,583
|
|
|
1,161,820
|
|
|
996,230
|
|
|
1,064,275
|
|
|
745,074
|
|
|||||
Debt
|
914,995
|
|
|
816,231
|
|
|
692,254
|
|
|
754,605
|
|
|
378,585
|
|
|||||
Total liabilities
|
993,909
|
|
|
859,335
|
|
|
731,342
|
|
|
801,311
|
|
|
415,852
|
|
|||||
Total On Deck Capital, Inc. stockholders' equity
|
$
|
294,000
|
|
|
$
|
297,952
|
|
|
$
|
260,877
|
|
|
$
|
258,892
|
|
|
$
|
322,615
|
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
|
As of or for the Year Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Gross Revenue
|
|
$
|
444,486
|
|
|
$
|
397,741
|
|
|
$
|
350,415
|
|
Originations
|
|
$
|
2,474,237
|
|
|
$
|
2,483,596
|
|
|
$
|
2,114,663
|
|
Portfolio Yield (a)
|
|
35.1
|
%
|
|
36.2
|
%
|
|
33.7
|
%
|
|||
Cost of Funds Rate
|
|
5.2
|
%
|
|
6.3
|
%
|
|
6.2
|
%
|
|||
Net Interest Margin (a)
|
|
29.2
|
%
|
|
28.9
|
%
|
|
26.1
|
%
|
|||
Provision Rate
|
|
7.0
|
%
|
|
6.0
|
%
|
|
7.5
|
%
|
|||
Reserve Ratio
|
|
12.2
|
%
|
|
12.2
|
%
|
|
11.6
|
%
|
|||
15+ Day Delinquency Ratio
|
|
9.0
|
%
|
|
7.5
|
%
|
|
6.7
|
%
|
|||
Net Charge-off Rate
|
|
13.6
|
%
|
|
11.3
|
%
|
|
15.8
|
%
|
|||
Efficiency Ratio (a)
|
|
46.4
|
%
|
|
44.6
|
%
|
|
47.4
|
%
|
|||
Adjusted Efficiency Ratio* (a)
|
|
44.0
|
%
|
|
40.2
|
%
|
|
42.9
|
%
|
|||
Return on Assets (a)
|
|
2.3
|
%
|
|
2.5
|
%
|
|
(1.2
|
)%
|
|||
Adjusted Return On Assets* (a)
|
|
2.1
|
%
|
|
4.2
|
%
|
|
0.3
|
%
|
|||
Return on Equity (a)
|
|
9.1
|
%
|
|
9.9
|
%
|
|
(4.8
|
)%
|
|||
Adjusted Return On Equity* (a)
|
|
8.5
|
%
|
|
16.3
|
%
|
|
1.4
|
%
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
48,961
|
|
|
$
|
48,833
|
|
Restricted cash
|
47,415
|
|
|
54,944
|
|
||
Loans and finance receivables
|
1,217,451
|
|
|
1,058,034
|
|
||
Less: Allowance for credit losses
|
(147,465
|
)
|
|
(126,260
|
)
|
||
Loans and finance receivables, net
|
1,069,986
|
|
|
931,774
|
|
||
Property, equipment and software, net
|
17,978
|
|
|
17,949
|
|
||
Other assets
|
57,880
|
|
|
15,651
|
|
||
Total assets
|
$
|
1,242,220
|
|
|
$
|
1,069,151
|
|
Liabilities, mezzanine equity and stockholders' equity
|
|
|
|
||||
Liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
4,793
|
|
|
$
|
3,717
|
|
Interest payable
|
2,667
|
|
|
2,392
|
|
||
Debt
|
852,322
|
|
|
751,040
|
|
||
Accrued expenses and other liabilities
|
62,246
|
|
|
32,984
|
|
||
Total liabilities
|
922,028
|
|
|
790,133
|
|
||
Mezzanine equity:
|
|
|
|
||||
Redeemable noncontrolling interest (1)
|
10,329
|
|
|
—
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Total On Deck Capital, Inc. stockholders' equity
|
306,437
|
|
|
274,099
|
|
||
Noncontrolling interest
|
3,426
|
|
|
4,919
|
|
||
Total stockholders' equity
|
309,863
|
|
|
279,018
|
|
||
Total liabilities, mezzanine equity and stockholders' equity
|
$
|
1,242,220
|
|
|
$
|
1,069,151
|
|
|
|
|
|
||||
Memo:
|
|
|
|
||||
Unpaid Principal Balance
|
$
|
1,192,756
|
|
|
$
|
1,037,563
|
|
Interest Earning Assets
|
$
|
1,313,827
|
|
|
$
|
1,161,811
|
|
Loans and Finance Receivables
|
$
|
1,217,451
|
|
|
$
|
1,058,034
|
|
•
|
Adjusted Net Income (Loss) does not reflect the potentially dilutive impact of stock-based compensation; and
|
•
|
Adjusted Net Income (Loss) excludes charges we are required to incur in connection with real estate dispositions, severance obligations, debt extinguishment costs and sales tax refunds.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands, except shares and per share data)
|
||||||||||
Reconciliation of Net Income (Loss) Attributable to OnDeck to Adjusted Net Income (Loss)
|
|
|
|
|
|
||||||
Net income (loss) attributable to On Deck Capital, Inc. common stockholders
|
$
|
27,955
|
|
|
$
|
27,046
|
|
|
$
|
(12,069
|
)
|
Adjustments (after tax):
|
|
|
|
|
|
||||||
Stock-based compensation expense
|
8,389
|
|
|
11,819
|
|
|
12,515
|
|
|||
Real estate disposition charges
|
—
|
|
|
4,187
|
|
|
—
|
|
|||
Severance and executive transition expenses
|
—
|
|
|
911
|
|
|
3,183
|
|
|||
Debt extinguishment costs
|
—
|
|
|
1,934
|
|
|
—
|
|
|||
Sales tax refund
|
—
|
|
|
(1,097
|
)
|
|
—
|
|
|||
Discrete tax benefit
|
(10,300
|
)
|
|
—
|
|
|
—
|
|
|||
Adjusted Net Income (Loss)
|
$
|
26,044
|
|
|
$
|
44,800
|
|
|
$
|
3,629
|
|
|
|
|
|
|
|
||||||
Adjusted Net Income (Loss) per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
0.35
|
|
|
$
|
0.60
|
|
|
$
|
0.05
|
|
Diluted
|
$
|
0.34
|
|
|
$
|
0.57
|
|
|
$
|
0.05
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
74,148,387
|
|
|
74,561,019
|
|
|
72,890,313
|
|
|||
Diluted
|
76,963,749
|
|
|
78,549,940
|
|
|
72,890,313
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(per share)
|
||||||||||
Reconciliation of Net Income (Loss) per Basic Share to Adjusted Net Income (Loss) per Basic Share
|
|
|
|
|
|
||||||
Net income (loss) per basic share attributable to On Deck Capital, Inc. common stockholders
|
$
|
0.38
|
|
|
$
|
0.36
|
|
|
$
|
(0.17
|
)
|
Add / (Subtract):
|
|
|
|
|
|
||||||
Stock-based compensation expense
|
0.11
|
|
|
0.15
|
|
|
0.17
|
|
|||
Real estate disposition charges
|
—
|
|
|
0.06
|
|
|
—
|
|
|||
Severance and executive transition expenses
|
—
|
|
|
0.01
|
|
|
0.05
|
|
|||
Debt extinguishment costs
|
—
|
|
|
0.03
|
|
|
—
|
|
|||
Sales tax refund
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|||
Discrete tax benefit
|
(0.14
|
)
|
|
—
|
|
|
—
|
|
|||
Adjusted Net Income (Loss) per Basic Share
|
$
|
0.35
|
|
|
$
|
0.60
|
|
|
$
|
0.05
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(per share)
|
||||||||||
Reconciliation of Net Income (Loss) per Diluted Share to Adjusted Net Income (Loss) per Diluted Share
|
|
|
|
|
|
||||||
Net income (loss) per diluted share attributable to On Deck Capital, Inc. common stockholders
|
$
|
0.36
|
|
|
$
|
0.34
|
|
|
$
|
(0.17
|
)
|
Add / (Subtract):
|
|
|
|
|
|
||||||
Stock-based compensation expense
|
0.11
|
|
|
0.15
|
|
|
0.17
|
|
|||
Real estate disposition charges
|
—
|
|
|
0.05
|
|
|
—
|
|
|||
Severance and executive transition expenses
|
—
|
|
|
0.01
|
|
|
0.05
|
|
|||
Debt extinguishment costs
|
—
|
|
|
0.03
|
|
|
—
|
|
|||
Sales tax refund
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|||
Discrete tax benefit
|
(0.13
|
)
|
|
—
|
|
|
—
|
|
|||
Adjusted Net Income (Loss) per Diluted Share
|
$
|
0.34
|
|
|
$
|
0.57
|
|
|
$
|
0.05
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands)
|
||||||||||
Reconciliation of Efficiency Ratio to Adjusted Efficiency Ratio
|
|
|
|
|
|
||||||
Total operating expense
|
$
|
206,325
|
|
|
$
|
177,490
|
|
|
$
|
166,170
|
|
Gross revenue
|
$
|
444,486
|
|
|
$
|
397,741
|
|
|
$
|
350,415
|
|
Efficiency Ratio
|
46.4
|
%
|
|
44.6
|
%
|
|
47.4
|
%
|
|||
Adjustments (pre-tax):
|
|
|
|
|
|
||||||
Stock-based compensation expense
|
$
|
10,966
|
|
|
$
|
11,819
|
|
|
$
|
12,515
|
|
Real estate disposition charges
|
—
|
|
|
4,187
|
|
|
—
|
|
|||
Severance and executive transition expenses
|
—
|
|
|
911
|
|
|
3,183
|
|
|||
Debt extinguishment costs
|
—
|
|
|
1,934
|
|
|
—
|
|
|||
Sales tax refund
|
—
|
|
|
(1,097
|
)
|
|
—
|
|
|||
Operating expenses less noteworthy items
|
$
|
195,359
|
|
|
$
|
159,736
|
|
|
$
|
150,472
|
|
Gross revenue
|
$
|
444,486
|
|
|
$
|
397,741
|
|
|
$
|
350,415
|
|
Adjusted Efficiency Ratio
|
44.0
|
%
|
|
40.2
|
%
|
|
42.9
|
%
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands)
|
||||||||||
Reconciliation of Return on Assets to Adjusted Return on Assets
|
|
|
|
|
|
||||||
Net income (loss) attributable to On Deck Capital, Inc. common stockholders
|
$
|
27,955
|
|
|
$
|
27,046
|
|
|
$
|
(12,069
|
)
|
Average total assets
|
$
|
1,242,220
|
|
|
$
|
1,069,151
|
|
|
$
|
1,039,164
|
|
Return on Assets
|
2.3
|
%
|
|
2.5
|
%
|
|
(1.2
|
)%
|
|||
Adjustments (after tax):
|
|
|
|
|
|
||||||
Stock-based compensation expense
|
$
|
8,389
|
|
|
$
|
11,819
|
|
|
$
|
12,515
|
|
Real estate disposition charges
|
—
|
|
|
4,187
|
|
|
—
|
|
|||
Severance and executive transition expenses
|
—
|
|
|
911
|
|
|
3,183
|
|
|||
Debt extinguishment costs
|
—
|
|
|
1,934
|
|
|
—
|
|
|||
Sales tax refund
|
—
|
|
|
(1,097
|
)
|
|
—
|
|
|||
Discrete tax benefit
|
(10,300
|
)
|
|
—
|
|
|
—
|
|
|||
Adjusted Net Income (Loss)
|
$
|
26,044
|
|
|
$
|
44,800
|
|
|
$
|
3,629
|
|
Average total assets
|
$
|
1,242,220
|
|
|
$
|
1,069,151
|
|
|
$
|
1,039,164
|
|
Adjusted Return on Assets
|
2.1
|
%
|
|
4.2
|
%
|
|
0.3
|
%
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands)
|
||||||||||
Reconciliation of Return on Equity to Adjusted Return on Equity
|
|
|
|
|
|
||||||
Net income (loss) attributable to On Deck Capital, Inc. common stockholders
|
$
|
27,955
|
|
|
$
|
27,046
|
|
|
$
|
(12,069
|
)
|
Average OnDeck stockholders' equity
|
$
|
306,437
|
|
|
$
|
274,099
|
|
|
$
|
253,777
|
|
Return on Equity
|
9.1
|
%
|
|
9.9
|
%
|
|
(4.8
|
)%
|
|||
Adjustments (after tax):
|
|
|
|
|
|
||||||
Stock-based compensation expense
|
$
|
8,389
|
|
|
$
|
11,819
|
|
|
$
|
12,515
|
|
Real estate disposition charges
|
—
|
|
|
4,187
|
|
|
—
|
|
|||
Severance and executive transition expenses
|
—
|
|
|
911
|
|
|
3,183
|
|
|||
Debt extinguishment costs
|
—
|
|
|
1,934
|
|
|
—
|
|
|||
Sales tax refund
|
—
|
|
|
(1,097
|
)
|
|
—
|
|
|||
Discrete tax benefit
|
(10,300
|
)
|
|
—
|
|
|
—
|
|
|||
Adjusted Net Income (Loss)
|
$
|
26,044
|
|
|
$
|
44,800
|
|
|
$
|
3,629
|
|
Average total On Deck Capital, Inc. stockholders' equity
|
$
|
306,437
|
|
|
$
|
274,099
|
|
|
$
|
253,777
|
|
Adjusted Return on Equity
|
8.5
|
%
|
|
16.3
|
%
|
|
1.4
|
%
|
|
Year Ended December 31,
|
|||||||
Percentage of Originations (Dollars)
|
2019
|
|
2018
|
|
2017
|
|||
Direct
|
40.2
|
%
|
|
44.1
|
%
|
|
52.1
|
%
|
Strategic Partner
|
31.8
|
%
|
|
26.5
|
%
|
|
21.0
|
%
|
Funding Advisor
|
28.0
|
%
|
|
29.4
|
%
|
|
26.9
|
%
|
•
|
the business must be approximately 50% paid down on its existing loan;
|
•
|
the business must be current on its outstanding OnDeck loan with no material delinquency history; and
|
•
|
the business must be fully re-underwritten and determined to be of adequate credit quality.
|
|
Year Ended December 31,
|
|||||||
Percentage of Originations (Dollars)
|
2019
|
|
2018
|
|
2017
|
|||
New
|
47.2
|
%
|
|
48.5
|
%
|
|
47.6
|
%
|
Repeat
|
52.8
|
%
|
|
51.5
|
%
|
|
52.4
|
%
|
Portfolio Yield
|
||||||||||||||
For the Year
|
|
For the Quarter
|
||||||||||||
2016
|
|
2017
|
|
2018
|
|
2019
|
|
Q1 2019
|
|
Q2 2019
|
|
Q3 2019
|
|
Q4 2019
|
33.1%
|
|
33.7%
|
|
36.2%
|
|
35.1%
|
|
35.6%
|
|
35.0%
|
|
35.1%
|
|
34.8%
|
•
|
Channel Mix - In general, loans originated from the strategic partner channel have lower Portfolio Yields than loans from the direct and funding advisor channel. This is primarily due to the strategic partner channel's higher commissions as compared to the direct channel, and lower pricing as compared to the funding advisor channel.
|
•
|
Term Mix - In general, term loans with longer durations have lower annualized interest rates. Despite lower yields, total revenues from customers with longer loan durations are typically higher than the revenue of customers with shorter-term, higher Loan Yield loans because total payback is typically higher compared to a shorter length term for the same principal loan amount. For the year ended December 31, 2019, the average length of new term loan originations had increased to 12.8 months from 11.3 months for the year ended December 31, 2018. The increase in average term length reflects the increased booking rate of longer-term loans with larger balances of higher credit quality loans as our credit policy has recently been further optimized for loans with those specific characteristics.
|
•
|
Customer Type Mix - In general, loans originated from repeat customers historically have had lower Portfolio Yields than loans from new customers. This is primarily because repeat customers typically have a higher OnDeck Score and are therefore deemed to be lower risk. In addition, repeat customers are more likely to be approved for longer terms than new customers given their established payment history and lower risk profiles. Finally, origination fees can be reduced or waived for repeat customers, contributing to lower Portfolio Yields.
|
•
|
Loan Mix - In general, lines of credit have lower Portfolio Yields than term loans. For the year ended December 31, 2019, the weighted average line of credit APR was 34.5%, compared to 48.3% for term loans. Draws by line of credit customers increased to 22.5% of total originations for the year end December 31, 2019 from 20.6% in the year ended December 31, 2018.
|
|
For the Year
|
|
For the Quarter
|
||||||
|
2015
|
2016
|
2017
|
2018
|
|
Q1 2019
|
Q2 2019
|
Q3 2019
|
Q4 2019
|
Principal Outstanding as of December 31, 2019 by Period of Origination
|
—%
|
—%
|
0.1%
|
1.4%
|
|
9.0%
|
29.3%
|
64.0%
|
91.6%
|
|
For the Year
|
|
For the Quarter
|
||||||||||||||||||||||
Originations
|
2015
|
2016
|
2017
|
2018
|
|
Q1 2019
|
Q2 2019
|
Q3 2019
|
Q4 2019
|
||||||||||||||||
All term loans
(in millions)
|
$
|
1,704
|
|
$
|
2,052
|
|
$
|
1,697
|
|
$
|
1,972
|
|
|
$
|
486
|
|
$
|
452
|
|
$
|
492
|
|
$
|
467
|
|
Weighted average term (months) at origination
|
12.4
|
|
13.2
|
|
12.1
|
|
11.8
|
|
|
11.7
|
|
12.2
|
|
13.5
|
|
13.2
|
|
|
For the Year
|
|
For the Quarter
|
||||||||||||||||||||||
Originations
|
2015
|
2016
|
2017
|
2018
|
|
Q1 2019
|
Q2 2019
|
Q3 2019
|
Q4 2019
|
||||||||||||||||
New term loans
(in thousands)
|
$
|
627,494
|
|
$
|
777,129
|
|
$
|
589,487
|
|
$
|
692,188
|
|
|
$
|
166,206
|
|
$
|
136,007
|
|
$
|
148,024
|
|
$
|
140,635
|
|
Weighted average term (months)
|
11.8
|
|
13.3
|
|
11.9
|
|
11.3
|
|
|
11.4
|
|
12.3
|
|
13.9
|
|
13.7
|
|
|
For the Year
|
|
For the Quarter
|
||||||||||||||||||||||
Originations
|
2015
|
2016
|
2017
|
2018
|
|
Q1 2019
|
Q2 2019
|
Q3 2019
|
Q4 2019
|
||||||||||||||||
Repeat term loans
(in thousands)
|
$
|
1,076,122
|
|
$
|
1,274,721
|
|
$
|
1,107,027
|
|
$
|
1,279,444
|
|
|
$
|
320,131
|
|
$
|
315,895
|
|
$
|
343,687
|
|
$
|
326,505
|
|
Weighted average term (months)
|
12.7
|
|
13.1
|
|
12.2
|
|
12.1
|
|
|
11.9
|
|
12.1
|
|
13.3
|
|
13.0
|
|
|
Year Ended December 31,
|
|
Year-over-Year Change
|
|||||||
|
2019
|
|
2018
|
|
2019 vs 2018
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Interest and finance income
|
$
|
428,423
|
|
|
$
|
382,944
|
|
|
11.9
|
%
|
Interest expense
|
44,670
|
|
|
47,075
|
|
|
(5.1
|
)%
|
||
Net interest income
|
383,753
|
|
|
335,869
|
|
|
14.3
|
%
|
||
Provision for credit losses
|
173,369
|
|
|
148,541
|
|
|
16.7
|
%
|
||
Net interest revenue, after credit provision
|
210,384
|
|
|
187,328
|
|
|
12.3
|
%
|
||
Other revenue
|
16,063
|
|
|
14,797
|
|
|
8.6
|
%
|
||
Total non-interest income
|
16,063
|
|
|
14,797
|
|
|
8.6
|
%
|
||
Operating expense:
|
|
|
|
|
|
|||||
Sales and marketing
|
50,518
|
|
|
44,082
|
|
|
14.6
|
%
|
||
Technology and analytics
|
67,380
|
|
|
50,866
|
|
|
32.5
|
%
|
||
Processing and servicing
|
24,664
|
|
|
21,209
|
|
|
16.3
|
%
|
||
General and administrative
|
63,763
|
|
|
61,333
|
|
|
4.0
|
%
|
||
Total operating expense
|
206,325
|
|
|
177,490
|
|
|
16.2
|
%
|
||
Income (loss) from operations, before provision for income taxes
|
20,122
|
|
|
24,635
|
|
|
(18.3
|
)%
|
||
Provision for (Benefit from) income taxes
|
(3,513
|
)
|
|
—
|
|
|
100.0
|
%
|
||
Net income (loss)
|
$
|
23,635
|
|
|
$
|
24,635
|
|
|
(4.1
|
)%
|
|
Year Ended December 31,
|
|
Year-over-Year Change
|
|||||||
|
2019
|
|
2018
|
|
2019 vs 2018
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Interest and finance income
|
$
|
428,423
|
|
|
$
|
382,944
|
|
|
11.9
|
%
|
Interest expense
|
44,670
|
|
|
47,075
|
|
|
(5.1
|
)%
|
||
Net interest income
|
$
|
383,753
|
|
|
$
|
335,869
|
|
|
14.3
|
%
|
|
Year Ended December 31,
|
|
Year-over-Year Change
|
|||||||
|
2019
|
|
2018
|
|
2019 vs 2018
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Provision for credit losses
|
$
|
173,369
|
|
|
$
|
148,541
|
|
|
16.7
|
%
|
|
Year Ended December 31,
|
|
Year-over-Year Change
|
|||||||
|
2019
|
|
2018
|
|
2019 vs 2018
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Other revenue
|
$
|
16,063
|
|
|
$
|
14,797
|
|
|
8.6
|
%
|
|
Year Ended December 31,
|
|
Year-over-Year Change
|
|||||||
|
2019
|
|
2018
|
|
2019 vs 2018
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Sales and marketing
|
$
|
50,518
|
|
|
$
|
44,082
|
|
|
14.6
|
%
|
|
Year Ended December 31,
|
|
Year-over-Year Change
|
|||||||
|
2019
|
|
2018
|
|
2019 vs 2018
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Technology and analytics
|
$
|
67,380
|
|
|
$
|
50,866
|
|
|
32.5
|
%
|
|
Year Ended December 31,
|
|
Year-over-Year Change
|
|||||||
|
2019
|
|
2018
|
|
2019 vs 2018
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Processing and servicing
|
$
|
24,664
|
|
|
$
|
21,209
|
|
|
16.3
|
%
|
|
Year Ended December 31,
|
|
Year-over-Year Change
|
|||||||
|
2019
|
|
2018
|
|
2019 vs 2018
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
General and administrative
|
$
|
63,763
|
|
|
$
|
61,333
|
|
|
4.0
|
%
|
|
Year Ended December 31,
|
|
Year-over-Year Change
|
|||||||
|
2019
|
|
2018
|
|
2019 vs 2018
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Provision for (Benefit from) income taxes
|
$
|
(3,513
|
)
|
|
$
|
—
|
|
|
100.0
|
%
|
|
Maturity
Date |
|
Weighted
Average Interest Rate |
|
Borrowing
Capacity |
|
Principal
Outstanding |
||||
|
|
|
|
|
(in millions)
|
||||||
Debt:
|
|
|
|
|
|
||||||
OnDeck Asset Securitization Trust II LLC 2019-1
|
November 2024
|
(1)
|
3.0%
|
|
$
|
125.0
|
|
|
$
|
125.0
|
|
OnDeck Asset Securitization Trust II LLC 2018-1
|
April 2022
|
(2)
|
3.8%
|
|
225.0
|
|
|
225.0
|
|
||
OnDeck Account Receivables Trust 2013-1 LLC
|
March 2022
|
(3)
|
3.4%
|
|
180.0
|
|
|
129.5
|
|
||
Receivable Assets of OnDeck, LLC
|
September 2021
|
(4)
|
3.3%
|
|
100.0
|
|
|
94.1
|
|
||
OnDeck Asset Funding II LLC
|
August 2022
|
(5)
|
4.7%
|
|
175.0
|
|
|
123.8
|
|
||
Prime OnDeck Receivable Trust II, LLC
|
March 2022
|
(6)
|
3.8%
|
|
75.0
|
|
|
—
|
|
||
Loan Assets of OnDeck, LLC
|
October 2022
|
(7)
|
3.4%
|
|
150.0
|
|
|
120.7
|
|
||
Corporate line of credit
|
January 2021
|
|
4.7%
|
|
105.0
|
|
(8)
|
40.0
|
|
||
International and other agreements
|
Various
|
(9)
|
4.9%
|
|
143.5
|
|
|
64.6
|
|
||
Total Debt
|
|
|
3.8%
|
|
$
|
1,278.5
|
|
|
$
|
922.7
|
|
(1)
|
The period during which new loans may be purchased under this securitization transaction expires in October 2021.
|
(2)
|
The period during which new loans may be purchased under this securitization transaction expires in March 2020.
|
(3)
|
The period during which new borrowings may be made under this facility expires in March 2021.
|
(4)
|
The period during which new borrowings of Class A revolving loans may be made under this debt facility expires in December 2020.
|
(5)
|
The period during which new borrowings may be made under this facility expires in August 2021.
|
(6)
|
The period during which new borrowings may be made under this facility expires in March 2021.
|
(7)
|
The period during which new borrowings may be made under this debt facility expires in April 2022.
|
(8)
|
On July 19, 2019, the Company entered into an agreement which increased the commitment under its corporate revolving debt facility by $20 million. See Note 8 of Notes to Consolidated Financial Statements.
|
(9)
|
Other Agreements include our local currency debt facilities in Australia and Canada. The periods during which new borrowings may be made under the various agreements expire between January 2020 and June 2021. Maturity dates range from January 2020 through December 2022.
|
|
As of and for the Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Cash provided by (used in):
|
|
|
|
||||
Operating activities
|
$
|
282,396
|
|
|
$
|
265,835
|
|
Investing activities
|
$
|
(303,614
|
)
|
|
$
|
(401,695
|
)
|
Financing activities
|
$
|
20,913
|
|
|
$
|
121,724
|
|
|
Payment Due by Period
|
||||||||||||||||||
|
Total
|
|
2020
|
|
2021-2022
|
|
2023-2024
|
|
Thereafter
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Contractual Obligations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt Principal
|
$
|
922,701
|
|
|
$
|
12,630
|
|
|
$
|
785,071
|
|
|
$
|
125,000
|
|
|
$
|
—
|
|
Interest payments(1)
|
85,944
|
|
|
34,140
|
|
|
44,782
|
|
|
7,022
|
|
|
—
|
|
|||||
Operating leases
|
48,393
|
|
|
7,183
|
|
|
13,168
|
|
|
13,284
|
|
|
14,758
|
|
|||||
Purchase obligations (2)
|
16,875
|
|
|
6,908
|
|
|
7,117
|
|
|
2,850
|
|
|
—
|
|
|||||
Total contractual obligations
|
$
|
1,073,913
|
|
|
$
|
60,861
|
|
|
$
|
850,138
|
|
|
$
|
148,156
|
|
|
$
|
14,758
|
|
(1)
|
Interest payments on our debt facilities with variable interest rates are calculated using the interest rate as of December 31, 2019.
|
(2)
|
Primarily consists of commitments to purchase credit data and software subscriptions.
|
•
|
Slight compression in Net Interest Margin reflecting a lower Portfolio Yield and increased leverage partially offset by a lower cost of funds,
|
•
|
Higher Provision for credit losses driven by portfolio growth,
|
•
|
Improved operating leverage, and
|
•
|
An Effective Tax Rate of approximately 30%, excluding an estimated $10 million valuation allowance release in the fourth quarter of 2020.
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 8.
|
Consolidated Financial Statements and Supplementary Data
|
|
Page
|
Index to Consolidated Financial Statements:
|
|
|
December 31,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
56,344
|
|
|
$
|
59,859
|
|
Restricted cash
|
40,524
|
|
|
37,779
|
|
||
Loans and finance receivables
|
1,265,312
|
|
|
1,169,407
|
|
||
Less: Allowance for credit losses
|
(151,133
|
)
|
|
(140,040
|
)
|
||
Loans and finance receivables, net
|
1,114,179
|
|
|
1,029,367
|
|
||
Property, equipment and software, net
|
20,332
|
|
|
16,700
|
|
||
Other assets
|
73,204
|
|
|
18,115
|
|
||
Total assets
|
$
|
1,304,583
|
|
|
$
|
1,161,820
|
|
Liabilities, mezzanine equity and stockholders' equity
|
|
|
|
||||
Liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
6,470
|
|
|
$
|
4,011
|
|
Interest payable
|
2,334
|
|
|
2,385
|
|
||
Debt
|
914,995
|
|
|
816,231
|
|
||
Accrued expenses and other liabilities
|
70,110
|
|
|
36,708
|
|
||
Total liabilities
|
993,909
|
|
|
859,335
|
|
||
Commitments and contingencies (Note 13)
|
|
|
|
||||
Mezzanine equity:
|
|
|
|
||||
Redeemable noncontrolling interest
|
14,428
|
|
|
—
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock—$0.005 par value, 1,000,000,000 shares authorized and 80,095,061 and 78,412,291 shares issued and 66,363,555 and 75,375,341 outstanding at December 31, 2019 and December 31, 2018, respectively.
|
405
|
|
|
396
|
|
||
Treasury stock—at cost
|
(49,641
|
)
|
|
(5,656
|
)
|
||
Additional paid-in capital
|
513,571
|
|
|
502,003
|
|
||
Accumulated deficit
|
(169,002
|
)
|
|
(196,959
|
)
|
||
Accumulated other comprehensive loss
|
(1,333
|
)
|
|
(1,832
|
)
|
||
Total On Deck Capital, Inc. stockholders' equity
|
294,000
|
|
|
297,952
|
|
||
Noncontrolling interest
|
2,246
|
|
|
4,533
|
|
||
Total stockholders' equity
|
296,246
|
|
|
302,485
|
|
||
Total liabilities, mezzanine equity and stockholders' equity
|
$
|
1,304,583
|
|
|
$
|
1,161,820
|
|
|
|
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Interest and finance income
|
$
|
428,423
|
|
|
$
|
382,944
|
|
|
$
|
334,040
|
|
Interest expense
|
44,670
|
|
|
47,075
|
|
|
46,199
|
|
|||
Net interest income
|
383,753
|
|
|
335,869
|
|
|
287,841
|
|
|||
Provision for credit losses
|
173,369
|
|
|
148,541
|
|
|
152,926
|
|
|||
Net interest income, after credit provision
|
210,384
|
|
|
187,328
|
|
|
134,915
|
|
|||
Gain on sales of loans
|
—
|
|
|
—
|
|
|
2,485
|
|
|||
Other revenue
|
16,063
|
|
|
14,797
|
|
|
13,890
|
|
|||
Total non-interest income
|
16,063
|
|
|
14,797
|
|
|
16,375
|
|
|||
Operating expense:
|
|
|
|
|
|
||||||
Sales and marketing
|
50,518
|
|
|
44,082
|
|
|
52,786
|
|
|||
Technology and analytics
|
67,380
|
|
|
50,866
|
|
|
53,392
|
|
|||
Processing and servicing
|
24,664
|
|
|
21,209
|
|
|
18,076
|
|
|||
General and administrative
|
63,763
|
|
|
61,333
|
|
|
41,916
|
|
|||
Total operating expense
|
206,325
|
|
|
177,490
|
|
|
166,170
|
|
|||
Income (loss) from operations, before provision for income taxes
|
20,122
|
|
|
24,635
|
|
|
(14,880
|
)
|
|||
Provision for (Benefit from) income taxes
|
(3,513
|
)
|
|
—
|
|
|
—
|
|
|||
Net income (loss)
|
23,635
|
|
|
24,635
|
|
|
(14,880
|
)
|
|||
Less: Net income (loss) attributable to noncontrolling interest
|
(4,320
|
)
|
|
(2,411
|
)
|
|
(2,811
|
)
|
|||
Net income (loss) attributable to On Deck Capital, Inc. common stockholders
|
$
|
27,955
|
|
|
$
|
27,046
|
|
|
$
|
(12,069
|
)
|
Net income (loss) per share attributable to On Deck Capital, Inc. common stockholders:
|
|
|
|
|
|
||||||
Basic
|
$
|
0.38
|
|
|
$
|
0.36
|
|
|
$
|
(0.17
|
)
|
Diluted
|
$
|
0.36
|
|
|
$
|
0.34
|
|
|
$
|
(0.17
|
)
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
74,148,387
|
|
|
74,561,019
|
|
|
72,890,313
|
|
|||
Diluted
|
76,963,749
|
|
|
78,549,940
|
|
|
72,890,313
|
|
|||
Comprehensive income (loss):
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
23,635
|
|
|
$
|
24,635
|
|
|
$
|
(14,880
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Unrealized gain (loss) on derivative instrument
|
(391
|
)
|
|
(456
|
)
|
|
—
|
|
|||
Foreign currency translation adjustment
|
907
|
|
|
(1,791
|
)
|
|
594
|
|
|||
Comprehensive income (loss)
|
24,151
|
|
|
22,388
|
|
|
(14,286
|
)
|
|||
Less: Comprehensive income (loss) attributable to noncontrolling interests
|
18
|
|
|
(467
|
)
|
|
267
|
|
|||
Less: Net income (loss) attributable to noncontrolling interest
|
(4,320
|
)
|
|
(2,411
|
)
|
|
(2,811
|
)
|
|||
Comprehensive income (loss) attributable to On Deck Capital, Inc. common stockholders
|
$
|
28,453
|
|
|
$
|
25,266
|
|
|
$
|
(11,742
|
)
|
|
On Deck Capital, Inc.'s stockholders' equity
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Deficit
|
|
Treasury
Stock
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total On Deck Capital, Inc. Stockholders' Equity
|
|
Noncontrolling Interest
|
|
Total Stockholders' Equity
|
|
|
Redeemable Noncontrolling Interest
|
|||||||||||||||||||||
|
Shares
|
|
Amount
|
|
|||||||||||||||||||||||||||||||||||
Balance—December 31, 2016
|
71,605,708
|
|
|
$
|
374
|
|
|
$
|
476,485
|
|
|
$
|
(211,932
|
)
|
|
$
|
(5,656
|
)
|
|
$
|
(379
|
)
|
|
$
|
258,892
|
|
|
$
|
4,072
|
|
|
$
|
262,964
|
|
|
|
$
|
—
|
|
Stock-based compensation
|
—
|
|
|
—
|
|
|
12,690
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,690
|
|
|
—
|
|
|
12,690
|
|
|
|
—
|
|
|||||||||
Investments by noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,440
|
|
|
3,440
|
|
|
|
—
|
|
|||||||||
Return of equity to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(957
|
)
|
|
(957
|
)
|
|
|
—
|
|
|||||||||
Issuance of common stock through vesting of restricted stock units and option exercises
|
1,748,349
|
|
|
10
|
|
|
454
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
464
|
|
|
—
|
|
|
464
|
|
|
|
—
|
|
|||||||||
Employee stock purchase plan
|
467,944
|
|
|
2
|
|
|
1,839
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,841
|
|
|
—
|
|
|
1,841
|
|
|
|
—
|
|
|||||||||
Tax withholding related to vesting of restricted stock units
|
—
|
|
|
—
|
|
|
(1,268
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,268
|
)
|
|
—
|
|
|
(1,268
|
)
|
|
|
—
|
|
|||||||||
Currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
327
|
|
|
327
|
|
|
267
|
|
|
594
|
|
|
|
—
|
|
|||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,069
|
)
|
|
—
|
|
|
—
|
|
|
(12,069
|
)
|
|
(2,811
|
)
|
|
(14,880
|
)
|
|
|
—
|
|
|||||||||
Balance—December 31, 2017
|
73,822,001
|
|
|
$
|
386
|
|
|
$
|
490,200
|
|
|
$
|
(224,001
|
)
|
|
$
|
(5,656
|
)
|
|
$
|
(52
|
)
|
|
$
|
260,877
|
|
|
$
|
4,011
|
|
|
$
|
264,888
|
|
|
|
$
|
—
|
|
Stock-based compensation
|
—
|
|
|
—
|
|
|
11,301
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,301
|
|
|
—
|
|
|
11,301
|
|
|
|
—
|
|
|||||||||
Investments by noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,400
|
|
|
3,400
|
|
|
|
—
|
|
|||||||||
Issuance of common stock through vesting of restricted stock units and option exercises
|
1,184,642
|
|
|
8
|
|
|
72
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
|
—
|
|
|
80
|
|
|
|
—
|
|
|||||||||
Employee stock purchase plan
|
368,698
|
|
|
2
|
|
|
2,287
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,289
|
|
|
—
|
|
|
2,289
|
|
|
|
—
|
|
|||||||||
Tax withholding related to vesting of restricted stock units
|
—
|
|
|
—
|
|
|
(1,857
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,857
|
)
|
|
—
|
|
|
(1,857
|
)
|
|
|
—
|
|
|||||||||
Currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,324
|
)
|
|
(1,324
|
)
|
|
(467
|
)
|
|
(1,791
|
)
|
|
|
—
|
|
|||||||||
Cash Flow Hedge and other
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(456
|
)
|
|
(460
|
)
|
|
—
|
|
|
(460
|
)
|
|
|
—
|
|
|||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
27,046
|
|
|
—
|
|
|
—
|
|
|
27,046
|
|
|
(2,411
|
)
|
|
24,635
|
|
|
|
—
|
|
|||||||||
Balance—December 31, 2018
|
75,375,341
|
|
|
$
|
396
|
|
|
$
|
502,003
|
|
|
$
|
(196,959
|
)
|
|
$
|
(5,656
|
)
|
|
$
|
(1,832
|
)
|
|
$
|
297,952
|
|
|
$
|
4,533
|
|
|
$
|
302,485
|
|
|
|
$
|
—
|
|
|
On Deck Capital, Inc.'s stockholders' equity
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
|
Common Stock
|
|
Additional
Paid-in Capital |
|
Accumulated
Deficit |
|
Treasury
Stock |
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total On Deck Capital, Inc. Stockholders' Equity
|
|
Noncontrolling Interest
|
|
Total Stockholders' Equity
|
|
|
Redeemable Noncontrolling Interest
|
|||||||||||||||||||||
|
Shares
|
|
Amount
|
|
|||||||||||||||||||||||||||||||||||
Balance—December 31, 2018
|
75,375,341
|
|
|
$
|
396
|
|
|
$
|
502,003
|
|
|
$
|
(196,959
|
)
|
|
$
|
(5,656
|
)
|
|
$
|
(1,832
|
)
|
|
$
|
297,952
|
|
|
$
|
4,533
|
|
|
$
|
302,485
|
|
|
|
$
|
—
|
|
Stock-based compensation
|
—
|
|
|
—
|
|
|
10,001
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,001
|
|
|
—
|
|
|
10,001
|
|
|
|
—
|
|
|||||||||
Issuance of common stock through vesting of restricted stock units and option exercises
|
1,111,800
|
|
|
6
|
|
|
98
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
104
|
|
|
—
|
|
|
104
|
|
|
|
—
|
|
|||||||||
Employee stock purchase plan
|
570,970
|
|
|
3
|
|
|
3,440
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,443
|
|
|
—
|
|
|
3,443
|
|
|
|
—
|
|
|||||||||
Repurchases of common stock
|
(10,694,556
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(43,985
|
)
|
|
—
|
|
|
(43,985
|
)
|
|
—
|
|
|
(43,985
|
)
|
|
|
—
|
|
|||||||||
Tax withholding related to vesting of restricted stock units
|
—
|
|
|
—
|
|
|
(1,959
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,959
|
)
|
|
—
|
|
|
(1,959
|
)
|
|
|
—
|
|
|||||||||
Fair value of redeemable noncontrolling interest resulting from business combination
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
16,444
|
|
|||||||||
Currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
889
|
|
|
889
|
|
|
(56
|
)
|
|
833
|
|
|
|
74
|
|
|||||||||
Cash flow hedge and other
|
—
|
|
|
—
|
|
|
(12
|
)
|
|
2
|
|
|
—
|
|
|
(390
|
)
|
|
(400
|
)
|
|
—
|
|
|
(400
|
)
|
|
|
(1
|
)
|
|||||||||
Net Income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
27,955
|
|
|
—
|
|
|
—
|
|
|
27,955
|
|
|
(2,231
|
)
|
|
25,724
|
|
|
|
(2,089
|
)
|
|||||||||
Balance—December 31, 2019
|
66,363,555
|
|
|
$
|
405
|
|
|
$
|
513,571
|
|
|
$
|
(169,002
|
)
|
|
$
|
(49,641
|
)
|
|
$
|
(1,333
|
)
|
|
$
|
294,000
|
|
|
$
|
2,246
|
|
|
$
|
296,246
|
|
|
|
$
|
14,428
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
23,635
|
|
|
$
|
24,635
|
|
|
$
|
(14,880
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Provision for credit losses
|
173,369
|
|
|
148,541
|
|
|
152,926
|
|
|||
Depreciation and amortization
|
6,433
|
|
|
7,802
|
|
|
9,951
|
|
|||
Amortization of debt issuance costs
|
3,605
|
|
|
6,656
|
|
|
3,806
|
|
|||
Stock-based compensation
|
10,964
|
|
|
11,819
|
|
|
12,515
|
|
|||
Amortization of net deferred origination costs
|
66,955
|
|
|
58,121
|
|
|
48,755
|
|
|||
Changes in servicing rights, at fair value
|
69
|
|
|
290
|
|
|
2,097
|
|
|||
Gain on sales of loans
|
—
|
|
|
—
|
|
|
(2,485
|
)
|
|||
Unfunded loan commitment reserve
|
1,308
|
|
|
1,438
|
|
|
535
|
|
|||
Gain on extinguishment of debt
|
—
|
|
|
—
|
|
|
(312
|
)
|
|||
Gain on lease termination
|
—
|
|
|
(1,481
|
)
|
|
—
|
|
|||
Loss on disposal of fixed assets
|
3,199
|
|
|
5,737
|
|
|
—
|
|
|||
Amortization of intangibles
|
501
|
|
|
—
|
|
|
—
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Other assets
|
(15,059
|
)
|
|
(4,972
|
)
|
|
4,768
|
|
|||
Accounts payable
|
2,476
|
|
|
1,535
|
|
|
(2,597
|
)
|
|||
Interest payable
|
(51
|
)
|
|
119
|
|
|
208
|
|
|||
Accrued expenses and other liabilities
|
4,992
|
|
|
5,595
|
|
|
(4,852
|
)
|
|||
Originations of loans held for sale
|
—
|
|
|
—
|
|
|
(49,813
|
)
|
|||
Capitalized net deferred origination costs of loans held for sale
|
—
|
|
|
—
|
|
|
(1,667
|
)
|
|||
Proceeds from sale of loans held for sale
|
—
|
|
|
—
|
|
|
51,463
|
|
|||
Principal repayments of loans held for sale
|
—
|
|
|
—
|
|
|
1,135
|
|
|||
Net cash provided by operating activities
|
282,396
|
|
|
265,835
|
|
|
211,553
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
||||||
Purchases of property, equipment and software
|
(3,189
|
)
|
|
(1,058
|
)
|
|
(1,340
|
)
|
|||
Capitalized internal-use software
|
(9,265
|
)
|
|
(5,385
|
)
|
|
(2,919
|
)
|
|||
Originations of loans and finance receivables, excluding rollovers into new originations
|
(2,079,442
|
)
|
|
(2,115,800
|
)
|
|
(1,758,600
|
)
|
|||
Proceeds from sale of loans held for investment
|
—
|
|
|
—
|
|
|
24,826
|
|
|||
Payments of net deferred origination costs
|
(69,426
|
)
|
|
(66,682
|
)
|
|
(46,133
|
)
|
|||
Principal repayments of loans and finance receivables
|
1,860,723
|
|
|
1,788,031
|
|
|
1,639,117
|
|
|||
Purchase of loans
|
—
|
|
|
(801
|
)
|
|
(13,840
|
)
|
|||
Acquisition of shares in business combination
|
(3,015
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash used in investing activities
|
(303,614
|
)
|
|
(401,695
|
)
|
|
(158,889
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
||||||
Investments by noncontrolling interests
|
—
|
|
|
3,400
|
|
|
3,443
|
|
|||
Tax withholding related to vesting of restricted stock units
|
(1,959
|
)
|
|
(1,857
|
)
|
|
(1,268
|
)
|
|||
Repurchases of common stock
|
(43,985
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from exercise of stock options
|
98
|
|
|
78
|
|
|
454
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Purchase of interest rate cap
|
—
|
|
|
(1,725
|
)
|
|
—
|
|
|||
Issuance of common stock under employee stock purchase plan
|
2,228
|
|
|
1,435
|
|
|
1,838
|
|
|||
Proceeds from the issuance of debt
|
761,424
|
|
|
759,171
|
|
|
211,781
|
|
|||
Payments of debt issuance costs
|
(5,338
|
)
|
|
(6,034
|
)
|
|
(4,108
|
)
|
|||
Repayments of debt principal
|
(691,555
|
)
|
|
(632,744
|
)
|
|
(273,679
|
)
|
|||
Distribution to noncontrolling interest
|
—
|
|
|
—
|
|
|
(957
|
)
|
|||
Net cash (used in) provided by financing activities
|
20,913
|
|
|
121,724
|
|
|
(62,496
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(465
|
)
|
|
(3,050
|
)
|
|
670
|
|
|||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(770
|
)
|
|
(17,186
|
)
|
|
(9,162
|
)
|
|||
Cash and cash equivalents at beginning of period
|
97,638
|
|
|
114,824
|
|
|
123,986
|
|
|||
Cash, cash equivalents, and restricted cash at end of period
|
$
|
96,868
|
|
|
$
|
97,638
|
|
|
$
|
114,824
|
|
Reconciliation to amounts on consolidated balance sheets
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
56,344
|
|
|
$
|
59,859
|
|
|
$
|
71,362
|
|
Restricted cash
|
40,524
|
|
|
37,779
|
|
|
43,462
|
|
|||
Total cash, cash equivalents and restricted cash
|
$
|
96,868
|
|
|
$
|
97,638
|
|
|
$
|
114,824
|
|
|
|
|
|
|
|
||||||
Supplemental disclosure of other cash flow information
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
40,004
|
|
|
$
|
42,208
|
|
|
$
|
41,918
|
|
Cash paid for taxes
|
$
|
9,315
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Supplemental disclosures of non-cash investing and financing activities
|
|
|
|
|
|
||||||
Stock-based compensation included in capitalized internal-use software
|
$
|
270
|
|
|
$
|
243
|
|
|
$
|
175
|
|
Unpaid principal balance of term loans rolled into new originations
|
$
|
395,192
|
|
|
$
|
368,385
|
|
|
$
|
306,250
|
|
Establishment of lease liabilities from the adoption of ASU 2016-02
|
$
|
37,630
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Additional lease liabilities incurred during the respective year
|
$
|
4,576
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Establishment of right-of-use assets from the adoption of ASU 2016-02
|
$
|
27,553
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Additional right-of-use assets incurred during the respective year
|
$
|
4,136
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Fair Value
|
||
Loans and finance receivables
|
$
|
36,763
|
|
Intangibles and other assets (1)
|
2,810
|
|
|
Debt and other liabilities
|
(34,437
|
)
|
|
Goodwill (1)
|
11,585
|
|
|
Net assets acquired
|
$
|
16,721
|
|
|
2019
|
||
Balance at beginning of the year
|
$
|
—
|
|
Business combination with Evolocity
|
10,844
|
|
|
Measurement period adjustment
|
741
|
|
|
Foreign currency translation adjustment
|
(53
|
)
|
|
Balance at end of year
|
$
|
11,532
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
23,635
|
|
|
$
|
24,635
|
|
|
$
|
(14,880
|
)
|
Less: Net income (loss) attributable to noncontrolling interest
|
(4,320
|
)
|
|
(2,411
|
)
|
|
(2,811
|
)
|
|||
Net income (loss) attributable to On Deck Capital, Inc. common stockholders
|
$
|
27,955
|
|
|
$
|
27,046
|
|
|
$
|
(12,069
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average common shares outstanding, basic
|
74,148,387
|
|
|
74,561,019
|
|
|
72,890,313
|
|
|||
Net income (loss) per common share, basic
|
$
|
0.38
|
|
|
$
|
0.36
|
|
|
$
|
(0.17
|
)
|
Effect of dilutive securities
|
2,815,362
|
|
|
3,988,921
|
|
|
—
|
|
|||
Weighted-average common shares outstanding, diluted
|
76,963,749
|
|
|
78,549,940
|
|
|
72,890,313
|
|
|||
Net income (loss) per common share, diluted
|
$
|
0.36
|
|
|
$
|
0.34
|
|
|
$
|
(0.17
|
)
|
Anti-dilutive securities excluded
|
6,491,071
|
|
|
5,423,547
|
|
|
11,410,980
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Interest and finance income
|
$
|
494,349
|
|
|
$
|
440,751
|
|
|
$
|
382,983
|
|
Amortization of net deferred origination costs
|
(67,061
|
)
|
|
(58,047
|
)
|
|
(49,075
|
)
|
|||
Interest and finance income, net
|
427,288
|
|
|
382,704
|
|
|
333,908
|
|
|||
Interest income on deposits and investments
|
1,135
|
|
|
240
|
|
|
132
|
|
|||
Total interest and finance income
|
$
|
428,423
|
|
|
$
|
382,944
|
|
|
$
|
334,040
|
|
|
2019
|
|
2018
|
||||
Term loans
|
$
|
946,322
|
|
|
$
|
956,755
|
|
Lines of credit
|
277,843
|
|
|
188,199
|
|
||
Other loans and finance receivables (1)
|
14,244
|
|
|
—
|
|
||
Total Unpaid Principal Balance
|
1,238,409
|
|
|
1,144,954
|
|
||
Net deferred origination costs
|
26,903
|
|
|
24,453
|
|
||
Total loans and finance receivables
|
$
|
1,265,312
|
|
|
$
|
1,169,407
|
|
(1)
|
Includes loans secured by equipment and our variable pay product.
|
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at beginning of period
|
$
|
140,040
|
|
|
$
|
109,015
|
|
|
$
|
110,162
|
|
Recoveries of previously charged off amounts
|
18,920
|
|
|
13,179
|
|
|
17,199
|
|
|||
Loans and finance receivables charged off
|
(181,196
|
)
|
|
(130,695
|
)
|
|
(171,272
|
)
|
|||
Provision for credit losses
|
173,369
|
|
|
148,541
|
|
|
152,926
|
|
|||
Allowance for credit losses at end of period
|
$
|
151,133
|
|
|
$
|
140,040
|
|
|
$
|
109,015
|
|
|
2019
|
|
2018
|
||||
Current loans and finance receivables
|
$
|
1,098,064
|
|
|
$
|
1,031,449
|
|
Delinquent: paying (accrual status)
|
38,514
|
|
|
54,427
|
|
||
Delinquent: non-paying (non-accrual status)
|
101,831
|
|
|
59,078
|
|
||
Total
|
$
|
1,238,409
|
|
|
$
|
1,144,954
|
|
|
2019
|
|
2018
|
||||
By delinquency status:
|
|
|
|
||||
Current loans and finance receivables
|
$
|
1,098,064
|
|
|
$
|
1,031,449
|
|
1-14 calendar days past due
|
28,375
|
|
|
27,655
|
|
||
15-29 calendar days past due
|
17,383
|
|
|
14,665
|
|
||
30-59 calendar days past due
|
25,067
|
|
|
21,470
|
|
||
60-89 calendar days past due
|
22,004
|
|
|
19,031
|
|
||
90 + calendar days past due
|
47,516
|
|
|
30,684
|
|
||
Total unpaid principal balance
|
$
|
1,238,409
|
|
|
$
|
1,144,954
|
|
|
Estimated
Useful Life
|
|
2019
|
|
2018
|
||||
Computer/office equipment
|
36 months
|
|
$
|
17,292
|
|
|
$
|
15,107
|
|
Capitalized internal-use software
|
36 months
|
|
36,733
|
|
|
30,412
|
|
||
Leasehold improvements
|
Life of lease
|
|
12,770
|
|
|
11,761
|
|
||
Total property, equipment and software, at cost
|
|
|
66,795
|
|
|
57,280
|
|
||
Less accumulated depreciation and amortization
|
|
|
(46,463
|
)
|
|
(40,580
|
)
|
||
Property, equipment and software, net
|
|
|
$
|
20,332
|
|
|
$
|
16,700
|
|
|
|
|
|
|
Outstanding
|
||||||||
|
Type
|
|
Maturity Date
|
|
Weighted Average Interest
Rate at December 31, 2019 |
|
December 31, 2019
|
|
December 31, 2018
|
||||
Debt:
|
|
|
|
|
|
|
|
|
|
||||
OnDeck Asset Securitization Trust II LLC 2018-1
|
Securitization
|
|
April 2022
|
(1)
|
3.8%
|
|
$
|
225,000
|
|
|
$
|
225,000
|
|
OnDeck Asset Securitization Trust II LLC 2019-1
|
Securitization
|
|
November 2024
|
(2)
|
3.0%
|
|
125,000
|
|
|
—
|
|
||
OnDeck Account Receivables Trust 2013-1
|
Revolving
|
|
March 2022
|
(3)
|
3.4%
|
|
129,512
|
|
|
117,664
|
|
||
Receivable Assets of OnDeck, LLC
|
Revolving
|
|
September 2021
|
(4)
|
3.3%
|
|
94,099
|
|
|
113,631
|
|
||
OnDeck Asset Funding II LLC
|
Revolving
|
|
August 2022
|
(5)
|
4.7%
|
|
123,840
|
|
|
109,568
|
|
||
Prime OnDeck Receivable Trust II
|
Revolving
|
|
March 2022
|
(6)
|
3.8%
|
|
—
|
|
|
108,816
|
|
||
Loan Assets of OnDeck, LLC
|
Revolving
|
|
October 2022
|
(7)
|
3.4%
|
|
120,665
|
|
|
100,000
|
|
||
Corporate line of credit
|
Revolving
|
|
January 2021
|
(8)
|
4.7%
|
|
40,000
|
|
|
—
|
|
||
International and other agreements
|
Various
|
|
Various
|
(9)
|
4.9%
|
|
64,585
|
|
|
47,318
|
|
||
|
|
|
|
|
3.8%
|
|
922,701
|
|
|
821,997
|
|
||
Deferred debt issuance cost
|
|
|
|
|
|
|
(7,706
|
)
|
|
(5,766
|
)
|
||
Total Debt
|
|
|
|
|
|
|
$
|
914,995
|
|
|
$
|
816,231
|
|
(1)
|
The period during which new loans may be purchased under this securitization transaction expires in March 2020.
|
(2)
|
The period during which new loans may be purchased under this securitization transaction expires in October 2021.
|
(3)
|
The period during which new borrowings may be made under this facility expires in March 2021.
|
(4)
|
The period during which new borrowings of Class A revolving loans may be made under this debt facility expires in December 2020.
|
(5)
|
The period during which new borrowings may be made under this facility expires in August 2021.
|
(6)
|
The period during which new borrowings may be made under this facility expires in March 2021.
|
(7)
|
The period during which new borrowings may be made under this debt facility expires in April 2022.
|
(8)
|
On July 19, 2019, the Company entered into an agreement which increased the commitment under its corporate revolving debt facility by $20 million. See Note 8 of Notes to Consolidated Financial Statements.
|
(9)
|
Other Agreements include, among others, our local currency debt facilities in Australia and Canada. The periods during which new borrowings may be made under the various agreements expire between January 2020 and June 2021. Maturity dates range from January 2020 through December 2022.
|
2020
|
$
|
12,630
|
|
2021
|
186,054
|
|
|
2022
|
599,017
|
|
|
2023
|
—
|
|
|
Thereafter
|
125,000
|
|
|
Total
|
$
|
922,701
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Current tax expense (benefit)
|
$
|
6,726
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Deferred tax expense (benefit)
|
(10,239
|
)
|
|
—
|
|
|
—
|
|
|||
Total income tax provision (benefit)
|
$
|
(3,513
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
2019
|
|
2018
|
||||
Deferred tax assets relating to:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
7,439
|
|
|
$
|
4,104
|
|
Loan loss reserve
|
35,452
|
|
|
33,691
|
|
||
Deferred compensation
|
6,967
|
|
|
5,839
|
|
||
Imputed interest income
|
532
|
|
|
415
|
|
||
Leases
|
1,389
|
|
|
1,207
|
|
||
Unrealized loss
|
345
|
|
|
545
|
|
||
Miscellaneous items
|
1,345
|
|
|
613
|
|
||
Total gross deferred tax assets
|
53,469
|
|
|
46,414
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Property, equipment and software
|
3,011
|
|
|
3,151
|
|
||
Origination costs
|
5,848
|
|
|
5,685
|
|
||
Total gross deferred tax liabilities
|
8,859
|
|
|
8,836
|
|
||
Net deferred tax asset
|
44,610
|
|
|
37,578
|
|
||
Less: valuation allowance
|
(34,373
|
)
|
|
(37,578
|
)
|
||
Net deferred tax asset less valuation allowance
|
$
|
10,237
|
|
|
$
|
—
|
|
|
December 31, 2019
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Interest rate cap
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total assets
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
December 31, 2018
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Interest rate cap
|
$
|
—
|
|
|
$
|
1,253
|
|
|
$
|
—
|
|
|
$
|
1,253
|
|
Total assets
|
$
|
—
|
|
|
$
|
1,253
|
|
|
$
|
—
|
|
|
$
|
1,253
|
|
|
December 31, 2019
|
||||||||||||||||||
|
Carrying Value
|
|
Fair Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans and finance receivables, net
|
$
|
1,114,179
|
|
|
$
|
1,241,893
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,241,893
|
|
Total assets
|
$
|
1,114,179
|
|
|
$
|
1,241,893
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,241,893
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed-rate debt
|
$
|
350,000
|
|
|
$
|
337,510
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
337,510
|
|
Total fixed-rate debt
|
$
|
350,000
|
|
|
$
|
337,510
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
337,510
|
|
|
December 31, 2018
|
||||||||||||||||||
|
Carrying Value
|
|
Fair Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans and finance receivables, net
|
$
|
1,029,367
|
|
|
$
|
1,155,464
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,155,464
|
|
Total assets
|
$
|
1,029,367
|
|
|
$
|
1,155,464
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,155,464
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed-rate debt
|
$
|
232,972
|
|
|
$
|
226,965
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
226,965
|
|
Total fixed-rate debt
|
$
|
232,972
|
|
|
$
|
226,965
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
226,965
|
|
|
2018
|
|
2017
|
Risk-free interest rate
|
2.82% - 3.13 %
|
|
2.32% - 2.42 %
|
Expected term (years)
|
5.3
|
|
5.0
|
Expected volatility
|
35% - 37%
|
|
42% - 44%
|
Dividend yield
|
—%
|
|
—%
|
Weighted-average grant date fair value per share
|
$2.12
|
|
$1.66
|
|
Number of
Options |
|
Weighted-
Average Exercise Price |
|
Weighted-
Average Remaining Contractual Term (in years) |
|
Aggregate
Intrinsic Value (in thousands) |
||||||
Outstanding at January 1, 2019
|
7,932,782
|
|
|
$
|
5.86
|
|
|
—
|
|
|
—
|
|
|
Exercised
|
(528,006
|
)
|
|
$
|
2.33
|
|
|
—
|
|
|
—
|
|
|
Expired
|
(582,557
|
)
|
|
$
|
11.16
|
|
|
—
|
|
|
—
|
|
|
Outstanding at December 31, 2019
|
6,822,219
|
|
|
$
|
5.68
|
|
|
5.1
|
|
|
$
|
8,648
|
|
Exercisable at December 31, 2019
|
6,133,031
|
|
|
$
|
5.68
|
|
|
4.8
|
|
|
$
|
8,648
|
|
Vested or expected to vest as of December 31, 2019
|
6,789,430
|
|
|
$
|
5.68
|
|
|
5.1
|
|
|
$
|
8,648
|
|
|
Number of RSUs and PRSUs
|
|
Weighted-Average Grant Date Fair Value Per Share
|
|||
Unvested at January 1, 2019
|
3,307,561
|
|
|
$
|
6.00
|
|
RSUs and PRSUs Granted
|
2,733,080
|
|
|
$
|
5.13
|
|
RSUs and PRSUs Vested
|
(1,142,074
|
)
|
|
$
|
6.55
|
|
RSUs and PRSUs Forfeited/Expired
|
(713,007
|
)
|
|
$
|
5.79
|
|
Unvested at December 31, 2019
|
4,185,560
|
|
|
$
|
5.32
|
|
Expected to vest after December 31, 2019
|
3,420,164
|
|
|
$
|
5.36
|
|
|
2019
|
|
2018
|
|
2017
|
|||
Risk-free interest rate
|
1.84
|
%
|
|
2.10
|
%
|
|
1.17
|
%
|
Expected term (years)
|
0.67
|
|
|
0.50
|
|
|
0.50
|
|
Expected volatility
|
42
|
%
|
|
47
|
%
|
|
37
|
%
|
|
2019
|
|
2018
|
|
2017
|
||||||
Sales and marketing
|
$
|
1,709
|
|
|
$
|
2,012
|
|
|
$
|
2,429
|
|
Technology and analytics
|
3,050
|
|
|
2,647
|
|
|
2,300
|
|
|||
Processing and servicing
|
426
|
|
|
385
|
|
|
483
|
|
|||
General and administrative
|
5,781
|
|
|
6,775
|
|
|
7,303
|
|
|||
Total
|
$
|
10,966
|
|
|
$
|
11,819
|
|
|
$
|
12,515
|
|
Derivative Type
|
|
Classification
|
|
2019
|
2018
|
||||
Assets:
|
|
|
|
|
|
||||
Interest rate cap agreement
|
|
Other Assets
|
|
$
|
—
|
|
$
|
1,253
|
|
|
2019
|
2018
|
||||
Amount Recognized in OCI on Derivative:
|
|
|
||||
Interest rate cap agreement
|
$
|
391
|
|
$
|
456
|
|
|
Location and Amount of Gain or (Loss) Recognized in Income on Cash Flow Hedging Relationships
|
||||||||||
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Interest expense
|
$
|
(855
|
)
|
|
$
|
(16
|
)
|
|
$
|
—
|
|
For the years ending December 31,
|
Operating Leases
|
||
2020
|
$
|
6,843
|
|
2021
|
6,665
|
|
|
2022
|
6,655
|
|
|
2023
|
6,249
|
|
|
2024
|
7,035
|
|
|
Thereafter
|
14,758
|
|
|
Total lease payments
|
$
|
48,205
|
|
Less: Imputed Interest
|
10,224
|
|
|
Total Lease Liability
|
$
|
37,981
|
|
|
December 31, 2019
|
|
September 30, 2019
|
|
June 30, 2019
|
|
March 31, 2019
|
|
December 31, 2018
|
|
September 30, 2018
|
|
June 30, 2018
|
|
March 31, 2018
|
||||||||||||||||
Net interest income
|
$
|
98,079
|
|
|
$
|
96,947
|
|
|
$
|
94,260
|
|
|
$
|
94,467
|
|
|
$
|
93,958
|
|
|
$
|
87,589
|
|
|
$
|
79,964
|
|
|
$
|
74,357
|
|
Net interest income, after credit provision
|
$
|
54,048
|
|
|
$
|
53,851
|
|
|
$
|
51,309
|
|
|
$
|
51,176
|
|
|
$
|
54,105
|
|
|
$
|
48,487
|
|
|
$
|
46,671
|
|
|
$
|
38,064
|
|
Net income (loss)
|
$
|
7,997
|
|
|
$
|
8,142
|
|
|
$
|
2,168
|
|
|
$
|
5,328
|
|
|
$
|
13,260
|
|
|
$
|
9,338
|
|
|
$
|
4,612
|
|
|
$
|
(2,576
|
)
|
Net income (loss) attributable to On Deck Capital, Inc. common stockholders
|
$
|
9,310
|
|
|
$
|
8,684
|
|
|
$
|
4,295
|
|
|
$
|
5,666
|
|
|
$
|
13,864
|
|
|
$
|
9,610
|
|
|
$
|
5,628
|
|
|
$
|
(2,058
|
)
|
Net income (loss) per share attributable to On Deck Capital, Inc. common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic
|
$
|
0.13
|
|
|
$
|
0.12
|
|
|
$
|
0.06
|
|
|
$
|
0.08
|
|
|
$
|
0.18
|
|
|
$
|
0.13
|
|
|
$
|
0.08
|
|
|
$
|
(0.03
|
)
|
Diluted
|
$
|
0.13
|
|
|
$
|
0.11
|
|
|
$
|
0.05
|
|
|
$
|
0.07
|
|
|
$
|
0.17
|
|
|
$
|
0.12
|
|
|
$
|
0.07
|
|
|
$
|
(0.03
|
)
|
|
As Reported
|
|
Adjustment
|
|
As Revised
|
||||||
Loans and finance receivables
|
$
|
1,169,157
|
|
|
$
|
250
|
|
|
$
|
1,169,407
|
|
Total assets
|
$
|
1,161,570
|
|
|
$
|
250
|
|
|
$
|
1,161,820
|
|
Accrued expenses and other liabilities
|
$
|
34,654
|
|
|
$
|
2,054
|
|
|
$
|
36,708
|
|
Total liabilities
|
$
|
857,281
|
|
|
$
|
2,054
|
|
|
$
|
859,335
|
|
Accumulated deficit
|
$
|
(195,155
|
)
|
|
$
|
(1,804
|
)
|
|
$
|
(196,959
|
)
|
Total On Deck Capital, Inc. stockholders' equity
|
$
|
299,756
|
|
|
$
|
(1,804
|
)
|
|
$
|
297,952
|
|
Total stockholders' equity
|
$
|
304,289
|
|
|
$
|
(1,804
|
)
|
|
$
|
302,485
|
|
|
Year Ended December 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||
|
As Reported
|
|
Adjustment
|
|
As Revised
|
|
As Reported
|
|
Adjustment
|
|
As Revised
|
Interest and finance income
|
$383,579
|
|
$(635)
|
|
$382,944
|
|
$334,575
|
|
$(535)
|
|
$334,040
|
Gross Revenue
|
$398,376
|
|
$(635)
|
|
$397,741
|
|
$350,950
|
|
$(535)
|
|
$350,415
|
Net Revenue
|
$202,760
|
(1)
|
$(635)
|
|
$202,125
|
|
$151,825
|
(1)
|
$(535)
|
|
$151,290
|
Income (loss) from operations, before provision for income taxes
|
$25,270
|
(1)
|
$(635)
|
|
$24,635
|
|
$(14,345)
|
(1)
|
$(535)
|
|
$(14,880)
|
Net income (loss)
|
$25,270
|
|
$(635)
|
|
$24,635
|
|
$(14,345)
|
|
$(535)
|
|
$(14,880)
|
|
Year Ended December 31, 2018
|
|
Year Ended December 31, 2017
|
||||||||||||
|
As Reported
|
|
As Revised
|
|
As Reported
|
|
As Revised
|
||||||||
Net income (loss) per common share, basic
|
$
|
0.37
|
|
|
$
|
0.36
|
|
|
$
|
(0.16
|
)
|
|
$
|
(0.17
|
)
|
Net income (loss) per common share, diluted
|
$
|
0.35
|
|
|
$
|
0.34
|
|
|
$
|
(0.16
|
)
|
|
$
|
(0.17
|
)
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
Item 9A.
|
Controls and Procedures
|
•
|
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.
|
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 and Financial Statement Schedules.
|
Item 16.
|
Form 10-K Summary.
|
|
On Deck Capital, Inc.
|
|
|
|
/s/ Kenneth A. Brause
|
|
Kenneth A. Brause
Chief Financial Officer
(Principal Financial Officer)
|
Date: February 28, 2020
|
|
|
|
|
/s/ Nicholas Sinigaglia
|
|
Nicholas Sinigaglia
Chief Accounting Officer (Principal Accounting Officer) |
Date: February 28, 2020
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Noah Breslow
|
|
Chief Executive Officer and
Director (Principal Executive
Officer)
|
|
February 28, 2020
|
Noah Breslow
|
|
|
|
|
|
|
|
|
|
/s/ Kenneth A. Brause
|
|
Chief Financial Officer
(Principal Financial Officer)
|
|
February 28, 2020
|
Kenneth A. Brause
|
|
|
|
|
|
|
|
|
|
/s/ Nicholas Sinigaglia
|
|
Chief Accounting Officer
(Principal Accounting Officer)
|
|
February 28, 2020
|
Nicholas Sinigaglia
|
|
|
|
|
|
|
|
|
|
/s/ Chandra Dhandapani
|
|
Director
|
|
February 28, 2020
|
Chandra Dhandapani
|
|
|
|
|
|
|
|
|
|
/s/ Daniel Henson
|
|
Director
|
|
February 28, 2020
|
Daniel Henson
|
|
|
|
|
|
|
|
|
|
/s/ Bruce P. Nolop
|
|
Director
|
|
February 28, 2020
|
Bruce P. Nolop
|
|
|
|
|
|
|
|
|
|
/s/ Manolo Sánchez
|
|
Director
|
|
February 28, 2020
|
Manolo Sánchez
|
|
|
|
|
|
|
|
|
|
/s/ Jane J. Thompson
|
|
Director
|
|
February 28, 2020
|
Jane J. Thompson
|
|
|
|
|
|
|
|
|
|
/s/ Ronald F. Verni
|
|
Director
|
|
February 28, 2020
|
Ronald F. Verni
|
|
|
|
|
|
|
|
|
|
/s/ Neil E. Wolfson
|
|
Director
|
|
February 28, 2020
|
Neil E. Wolfson
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Filed /
Incorporated by
Reference from
Form *
|
|
Incorporated
by Reference
from Exhibit
Number
|
|
Date Filed
|
|
|
8-K
|
|
3.1
|
|
12/22/2014
|
||
|
|
10-Q
|
|
3.2
|
|
11/6/2018
|
||
|
|
S-1
|
|
4.1
|
|
11/10/2014
|
||
|
|
Filed herewith.
|
|
|
|
|
||
|
|
S-1
|
|
10.1
|
|
11/10/2014
|
||
|
|
S-1
|
|
10.2
|
|
11/10/2014
|
||
|
|
S-1/A
|
|
10.3
|
|
12/4/2014
|
||
|
|
10-Q
|
|
10.1
|
|
8/7/2019
|
||
|
|
S-1
|
|
10.5
|
|
11/10/2014
|
||
|
|
10-K
|
|
10.6
|
|
3/1/2019
|
||
|
|
S-1
|
|
10.7
|
|
11/10/2014
|
||
|
|
10-Q
|
|
10.1
|
|
11/7/2017
|
||
|
|
10-Q
|
|
10.2
|
|
11/7/2017
|
||
|
|
8-K
|
|
10.1
|
|
9/21/2016
|
||
|
|
S-1
|
|
10.12
|
|
11/10/2014
|
||
|
|
10-K
|
|
10.21
|
|
3/10/2015
|
||
|
|
10-Q
|
|
10.3
|
|
5/9/2019
|
||
|
|
S-1
|
|
10.15
|
|
11/10/2014
|
||
|
|
10-Q
|
|
10.2
|
|
8/9/2016
|
||
|
|
10-Q
|
|
10.2
|
|
8/7/2018
|
||
|
|
Filed herewith.
|
|
|
|
|
||
|
|
10-Q
|
|
10.3
|
|
8/7/2018
|
|
|
Filed herewith.
|
|
|
|
|
||
|
|
S-1
|
|
10.20
|
|
11/10/2014
|
||
|
|
10-K
|
|
10.17
|
|
3/1/2019
|
||
|
|
10-K
|
|
10.23
|
|
3/2/2017
|
||
|
|
10-Q
|
|
10.4
|
|
5/9/2019
|
||
|
|
10-Q
|
|
10.2
|
|
5/8/2018
|
||
|
|
Filed herewith.
|
|
|
|
|
||
|
|
10-Q
|
|
10.3
|
|
5/8/2018
|
||
|
|
10-Q
|
|
10.4
|
|
5/8/2018
|
||
|
|
10-Q
|
|
10.1
|
|
8/7/2018
|
||
|
|
10-Q
|
|
10.1
|
|
5/9/2019
|
||
|
|
10-Q
|
|
10.2
|
|
5/9/2019
|
||
|
|
10-Q
|
|
10.1
|
|
11/6/2018
|
||
|
|
10-Q
|
|
10.1
|
|
11/7/2019
|
||
|
|
Filed herewith.
|
|
|
|
|
||
|
|
Filed herewith.
|
|
|
|
|
||
|
|
Filed herewith.
|
|
|
|
|
||
|
|
Filed herewith.
|
|
|
|
|
|
|
Filed herewith.
|
|
|
|
|
||
|
|
Filed herewith.
|
|
|
|
|
||
101.INS
|
|
XBRL Instance Document
|
|
Filed herewith.
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
Filed herewith.
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
Filed herewith.
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
Filed herewith.
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Labels Linkbase Document
|
|
Filed herewith.
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
Filed herewith.
|
|
|
|
|
*
|
Exhibit incorporated by reference to the Registrant's Form S-1 Registration Statement, Registration No. 333-200043
|
+
|
Indicates a management contract or compensatory plan.
|
|
|
By: /s/
|
Kenneth A. Brause
|
ARTICLE 1
|
DEFINITIONS AND INCORPORATION BY REFERENCE
|
1
|
Section 1.1.
|
Definitions.
|
1
|
Section 1.2
|
Cross-References.
|
1
|
Section 1.3.
|
Accounting and Financial Determinations; No Duplication.
|
1
|
Section 1.4.
|
Rules of Construction.
|
2
|
|
|
|
ARTICLE 2
|
THE NOTES
|
2
|
Section 2.1.
|
Designation and Terms of Notes.
|
2
|
Section 2.2.
|
Notes Issuable in Series.
|
3
|
Section 2.3.
|
Execution and Authentication.
|
5
|
Section 2.4.
|
Registration of Transfer and Exchange of Notes.
|
6
|
Section 2.5.
|
Mutilated, Destroyed, Lost or Stolen Notes.
|
9
|
Section 2.6.
|
Appointment of Paying Agent.
|
10
|
Section 2.7.
|
Persons Deemed Owners.
|
11
|
Section 2.8.
|
Noteholder List.
|
11
|
Section 2.9.
|
Treasury Notes.
|
12
|
Section 2.10.
|
Book-Entry Notes.
|
12
|
Section 2.11.
|
Definitive Notes.
|
13
|
Section 2.12.
|
Global Note.
|
14
|
Section 2.13.
|
Principal and Interest.
|
14
|
Section 2.14.
|
Cancellation.
|
15
|
|
|
|
ARTICLE 3
|
SECURITY
|
15
|
Section 3.1.
|
Grant of Security Interest.
|
15
|
Section 3.2.
|
Transaction Documents.
|
17
|
Section 3.3.
|
Release of Issuer Assets.
|
17
|
Section 3.4.
|
Officer’s Certificate.
|
18
|
Section 3.5.
|
Stamp, Other Similar Taxes and Filing Fees.
|
18
|
ARTICLE 4
|
REPORTS
|
18
|
Section 4.1.
|
Servicer Reports.
|
18
|
Section 4.2.
|
Communication to Noteholders.
|
19
|
Section 4.3.
|
Rule 144A Information.
|
19
|
Section 4.4.
|
Reports by the Issuer.
|
19
|
Section 4.5.
|
Reports by the Indenture Trustee.
|
20
|
|
|
|
ARTICLE 5.
|
ALLOCATION AND APPLICATION OF COLLECTIONS
|
20
|
Section 5.1.
|
Issuer Accounts.
|
20
|
Section 5.2.
|
Collections of Money.
|
21
|
Section 5.3.
|
Collections and Allocations.
|
21
|
|
|
|
ARTICLE 6.
|
DISTRIBUTIONS
|
23
|
Section 6.1.
|
Distributions in General.
|
23
|
Section 6.2.
|
Optional Prepayment Notes.
|
23
|
|
|
|
ARTICLE 7.
|
REPRESENTATIONS AND WARRANTIES
|
23
|
Section 7.1.
|
Existence and Power.
|
23
|
Section 7.2.
|
Authorization.
|
24
|
Section 7.3.
|
Binding Effect.
|
24
|
Section 7.4.
|
Litigation.
|
24
|
Section 7.5.
|
No ERISA Plan.
|
24
|
Section 7.6.
|
Tax Filings and Expenses.
|
25
|
Section 7.7.
|
Disclosure.
|
25
|
Section 7.8.
|
Investment Company Act.
|
25
|
Section 7.9.
|
Regulations T, U and X.
|
25
|
Section 7.10.
|
No Consent.
|
26
|
Section 7.11.
|
Solvency.
|
26
|
Section 7.12.
|
Security Interests.
|
26
|
Section 7.13.
|
Binding Effect of Certain Agreements.
|
27
|
Section 7.14.
|
Non Existence of Other Agreements.
|
27
|
Section 7.15.
|
Compliance with Contractual Obligations and Laws.
|
27
|
Section 7.16.
|
Other Representations.
|
27
|
Section 7.17.
|
Ownership of the Issuer.
|
28
|
|
|
|
ARTICLE 8.
|
COVENANTS
|
28
|
Section 8.1.
|
Payment of Notes.
|
28
|
Section 8.2.
|
Maintenance of Office or Agency.
|
28
|
Section 8.3.
|
Payment of Obligations.
|
29
|
Section 8.4.
|
Conduct of Business and Maintenance of Existence.
|
29
|
Section 8.5.
|
Compliance with Laws.
|
29
|
Section 8.6.
|
Inspection of Property, Books and Records.
|
29
|
Section 8.7.
|
Compliance with Transaction Documents; Issuer Assets.
|
29
|
Section 8.8.
|
Notice of Defaults.
|
31
|
Section 8.9.
|
Notice of Material Proceedings.
|
31
|
Section 8.10.
|
Further Requests.
|
31
|
Section 8.11.
|
Protection of Issuer Assets.
|
31
|
Section 8.12.
|
Annual Opinion of Counsel.
|
32
|
Section 8.13.
|
Liens.
|
32
|
Section 8.14.
|
Other Indebtedness.
|
32
|
Section 8.15.
|
Mergers.
|
33
|
Section 8.16.
|
Sales of Issuer Assets.
|
33
|
Section 8.17.
|
Acquisition of Assets.
|
33
|
Section 8.18.
|
Legal Name; Location Under Section 9-301.
|
33
|
Section 8.19.
|
Organizational Documents.
|
33
|
Section 8.20.
|
Investments.
|
33
|
Section 8.21.
|
Non-Petition; No Other Agreements.
|
33
|
Section 8.22.
|
Other Business.
|
34
|
Section 8.23.
|
Maintenance of Separate Existence.
|
34
|
Section 8.24.
|
Use of Proceeds of Notes.
|
34
|
Section 8.25.
|
No ERISA Plan.
|
34
|
Section 8.26.
|
Dividends.
|
34
|
Section 8.27.
|
Tax Matters.
|
34
|
Section 8.28.
|
Purchase and Sale of Assets.
|
34
|
|
|
|
ARTICLE 9.
|
REMEDIES
|
35
|
Section 9.1.
|
Events of Default.
|
35
|
Section 9.2.
|
Acceleration of Maturity; Rescission and Annulment.
|
36
|
Section 9.3.
|
Collection of Indebtedness and Suits for Enforcement by the Indenture Trustee.
|
36
|
Section 9.4.
|
Remedies; Priorities.
|
38
|
Section 9.5.
|
Optional Preservation of the Issuer Assets.
|
40
|
Section 9.6.
|
Limitation on Suits.
|
40
|
Section 9.7.
|
Unconditional Rights of Noteholders to Receive Principal and Interest.
|
41
|
Section 9.8.
|
Restoration of Rights and Remedies.
|
41
|
Section 9.9.
|
Rights and Remedies Cumulative.
|
41
|
Section 9.10.
|
Delay or Omission Not a Waiver.
|
41
|
Section 9.11.
|
Control by Noteholders.
|
42
|
Section 9.12.
|
Waiver of Past Defaults.
|
42
|
Section 9.13.
|
Undertaking for Costs.
|
43
|
Section 9.14.
|
Waiver of Stay or Extension Laws.
|
43
|
Section 9.15.
|
Action on Notes.
|
43
|
|
|
|
ARTICLE10
|
THE INDENTURE TRUSTEE
|
44
|
Section 10.1.
|
Duties of the Indenture Trustee.
|
44
|
Section 10.2.
|
Rights of the Indenture Trustee.
|
45
|
Section 10.3.
|
Indenture Trustee’s Disclaimer.
|
48
|
Section 10.4.
|
Indenture Trustee May Own Notes.
|
48
|
Section 10.5.
|
Notice of Defaults.
|
48
|
Section 10.6.
|
Compensation; Indemnity.
|
49
|
Section 10.7.
|
Eligibility Requirements for Indenture Trustee.
|
49
|
Section 10.8.
|
Resignation or Removal of Indenture Trustee.
|
50
|
Section 10.9.
|
Successor Indenture Trustee by Merger.
|
51
|
Section 10.10.
|
Appointment of Co-Trustee or Separate Trustee.
|
52
|
Section 10.11.
|
Representations and Warranties of Indenture Trustee.
|
53
|
Section 10.12.
|
Preferential Collection of Claims Against the Issuer.
|
54
|
|
|
|
ARTICLE 11.
|
DISCHARGE OF INDENTURE
|
54
|
Section 11.1.
|
Termination of the Issuer’s Obligations.
|
54
|
Section 11.2.
|
Application of Trust Money.
|
55
|
Section 11.3.
|
Repayment to the Issuer.
|
55
|
|
|
|
ARTICLE 12.
|
AMENDMENTS
|
55
|
Section 12.1.
|
Without Consent of the Noteholders.
|
55
|
Section 12.2.
|
With Consent of the Noteholders.
|
56
|
Section 12.3.
|
Supplements.
|
58
|
Section 12.4.
|
Revocation and Effect of Consents.
|
58
|
Section 12.5.
|
Notation on or Exchange of Notes.
|
58
|
Section 12.6.
|
The Indenture Trustee to Sign Amendments, etc.
|
58
|
Section 12.7.
|
Conformity with Trust Indenture Act.
|
58
|
|
|
|
ARTICLE 13.
|
MISCELLANEOUS
|
59
|
Section 13.1.
|
Compliance Certificates.
|
59
|
Section 13.2.
|
Forms of Documents Delivered to Indenture Trustee.
|
60
|
Section 13.3.
|
Actions of Noteholders.
|
61
|
Section 13.4.
|
Notices.
|
62
|
Section 13.5.
|
Conflict with TIA.
|
64
|
Section 13.6.
|
Rules by the Indenture Trustee.
|
64
|
Section 13.7.
|
Duplicate Originals.
|
64
|
Section 13.8.
|
Benefits of Indenture.
|
64
|
Section 13.9.
|
Payment on Business Day.
|
64
|
Section 13.10.
|
Governing Law.
|
65
|
Section 13.11.
|
Severability of Provisions.
|
65
|
Section 13.12.
|
Counterparts.
|
65
|
Section 13.13.
|
Successors.
|
65
|
Section 13.14.
|
Table of Contents, Headings, etc.
|
65
|
Section 13.15.
|
Recording of Indenture.
|
65
|
Section 13.16.
|
No Petition.
|
66
|
Section 13.17.
|
Non-Recourse.
|
66
|
Section 13.18.
|
Waiver of Jury Trial.
|
66
|
Section 13.19.
|
Submission to Jurisdiction.
|
66
|
|
|
|
EXHIBIT A
|
Form of Deposit Report
|
|
EXHIBIT B
|
Form of Settlement Statement
|
|
|
Page
|
PRELIMINARY STATEMENT
|
1
|
DESIGNATION
|
1
|
ARTICLE I DEFINITIONS
|
2
|
ARTICLE II ARTICLE 5 OF THE BASE INDENTURE
|
28
|
Section 2.1 Establishment of Series 2019-1 Accounts.
|
28
|
Section 2.2 Series 2019-1 Reserve Account
|
29
|
Section 2.3 Indenture Trustee As Securities Intermediary.
|
31
|
Section 2.4 Allocations with Respect to the Series 2019-1 Notes.
|
32
|
Section 2.5 Monthly Application of Total Available Amount.
|
34
|
Section 2.6 Distribution of Interest Payments and Principal Payments.
|
36
|
ARTICLE III AMORTIZATION EVENTS; SERVICER DEFAULTS
|
37
|
Section 3.1 Amortization Events
|
37
|
Section 3.2 Servicer Defaults
|
39
|
ARTICLE IV OPTIONAL PREPAYMENT
|
39
|
ARTICLE V SERVICING FEE
|
40
|
Section 5.1 Servicing Fee
|
40
|
Section 5.2 Successor Servicing Fee
|
40
|
ARTICLE VI FORM OF SERIES 2019-1 NOTES
|
41
|
Section 6.1 Issuance of Series 2019-1 Notes.
|
41
|
Section 6.2 Restricted Global Notes.
|
42
|
Section 6.3 Temporary Global Notes and Permanent Global Notes.
|
42
|
Section 6.4 Definitive Notes.
|
43
|
Section 6.5 Transfer Restrictions.
|
43
|
ARTICLE VII INFORMATION
|
50
|
ARTICLE VIII MISCELLANEOUS
|
50
|
Section 8.1 Ratification of Indenture.
|
50
|
Section 8.2 Governing Law.
|
50
|
Section 8.3 Further Assurances.
|
50
|
Section 8.4 Exhibits.
|
51
|
Section 8.5 No Waiver; Cumulative Remedies.
|
51
|
Section 8.6 Amendments.
|
52
|
Section 8.7 Consent to Amendments.
|
52
|
Section 8.8 Severability.
|
52
|
Section 8.9 Counterparts.
|
52
|
Section 8.10 No Bankruptcy Petition.
|
52
|
Section 8.11 Notice to Rating Agency.
|
52
|
Section 8.12 Annual Opinion of Counsel.
|
53
|
Section 8.13 Tax Treatment.
|
53
|
Section 8.14 Confidentiality.
|
53
|
|
|
EXHIBITS
|
|
Exhibit A-1:
|
Form of Restricted Global Class A Note
|
Exhibit A-2:
|
Form of Temporary Global Class A Note
|
Exhibit A-3:
|
Form of Permanent Global Class A Note
|
Exhibit B-1:
|
Form of Restricted Global Class B Note
|
Exhibit B-2:
|
Form of Temporary Global Class B Note
|
Exhibit B-3:
|
Form of Permanent Global Class B Note
|
Exhibit C-1:
|
Form of Restricted Global Class C Note
|
Exhibit C-2:
|
Form of Temporary Global Class C Note
|
Exhibit C-3:
|
Form of Permanent Global Class C Note
|
Exhibit D-1:
|
Form of Restricted Global Class D Note
|
Exhibit D-2:
|
Form of Temporary Global Class D Note
|
Exhibit D-3:
|
Form of Permanent Global Class D Note
|
Exhibit E:
|
Form of Restricted Global Class E Note
|
Exhibit F-1:
|
Form of Transfer Certificate
|
Exhibit F-2:
|
Form of Transfer Certificate
|
Exhibit F 3:
|
Form of Transfer Certificate
|
Exhibit F-4:
|
Form of Clearing System Certificate
|
Exhibit F-5:
|
Form of Certificate of Beneficial Ownership
|
Exhibit G:
|
Form of Letter of Representations For Class E Noteholders
|
Exhibit H:
|
Form of Monthly Settlement Statement
|
Exhibit I:
|
Form of Withdrawal Request
|
Exhibit J:
|
Industry Codes
|
Exhibit K-1:
|
Form of Amendment No. 1 to the Custodial Agreement
|
Exhibit K-2:
|
Form of Amendment No. 2 to the Base Indenture
|
Exhibit K-3:
|
Form of Amendment No. 2 to the Loan Purchase Agreement
|
Exhibit A-1:
|
Form of Restricted Global Class A Note
|
Exhibit A-2:
|
Form of Temporary Global Class A Note
|
Exhibit A-3:
|
Form of Permanent Global Class A Note
|
Exhibit B-1:
|
Form of Restricted Global Class B Note
|
Exhibit B-2:
|
Form of Temporary Global Class B Note
|
Exhibit B-3:
|
Form of Permanent Global Class B Note
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Exhibit C-1:
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Form of Restricted Global Class C Note
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Exhibit C-2:
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Form of Temporary Global Class C Note
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Exhibit C-3:
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Form of Permanent Global Class C Note
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Exhibit D-1:
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Form of Restricted Global Class D Note
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Exhibit D-2:
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Form of Temporary Global Class D Note
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Exhibit D-3:
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Form of Permanent Global Class D Note
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Exhibit E:
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Form of Restricted Global Class E Note
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Exhibit F-1:
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Form of Transfer Certificate
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Exhibit F-2:
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Form of Transfer Certificate
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Exhibit F 3:
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Form of Transfer Certificate
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Exhibit F-4:
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Form of Clearing System Certificate
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Exhibit F-5:
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Form of Certificate of Beneficial Ownership
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Exhibit G:
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Form of Letter of Representations For Class E Noteholders
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Exhibit H:
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Form of Monthly Settlement Statement
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Exhibit I:
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Form of Withdrawal Request
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Exhibit J:
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Industry Codes
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Exhibit K-1:
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Form of Amendment No. 1 to the Custodial Agreement
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Exhibit K-2:
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Form of Amendment No. 2 to the Base Indenture
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Exhibit K-3:
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Form of Amendment No. 2 to the Loan Purchase Agreement
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Name
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Jurisdiction
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OnDeck Account Receivables Trust 2013-1 LLC
|
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Delaware
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OnDeck Asset Funding II LLC
|
|
Delaware
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OnDeck Asset Securitization Trust II LLC
|
|
Delaware
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OnDeck Funding Trust No. 2
|
|
Australia
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On Deck Capital Australia PTY LTD (1)
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|
Australia
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On Deck Capital Canada, Inc.(2)
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|
Canada
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ODX, LLC
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Delaware
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Canada On Deck Asset Funding, LP(2)
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|
Canada
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Loan Assets of OnDeck, LLC
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|
Delaware
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Prime OnDeck Receivable Trust II, LLC
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|
Delaware
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Receivable Assets of OnDeck, LLC
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|
Delaware
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1.
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Registration Statement (Form S-8 No. 333-200998) of On Deck Capital, Inc.
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2.
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Registration Statement (Form S-8 No. 333-209938) of On Deck Capital, Inc.
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3.
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Registration Statement (Form S-8 No. 333-216801) of On Deck Capital, Inc.
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4.
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Registration Statement (Form S-8 No. 333-231325) of On Deck Capital, Inc.
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1.
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I have reviewed this Annual Report on Form 10-K of On Deck Capital, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
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The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Noah Breslow
|
|
Noah Breslow
Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K of On Deck Capital, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Kenneth A. Brause
|
|
Kenneth A. Brause
Chief Financial Officer
|
|
/s/ Noah Breslow
|
|
Noah Breslow
Chief Executive Officer
|
|
/s/ Kenneth A. Brause
|
|
Kenneth A. Brause
Chief Financial Officer
|