MeetMe, Inc. (Form: 10-Q, Received: 11/08/2013 16:56:12)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934

	For the quarterly period ended September 30, 2013

	OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934

	For the transition period from to

Commission file number: 001-33105

MeetMe, Inc.

(Exact name of registrant as specified in its charter)

Delaware	86-0879433
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

100 Union Square Drive
New Hope, Pennsylvania	18938
(Address of principal executive offices)	(Zip Code)

Registrants telephone number: (215) 862-1162

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☒

Non-accelerated filer ☐ (Do not check if a smaller reporting company) Smaller reporting company ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

Class		Outstanding as of November 8, 2013
Common Stock, $0.001 par value per share		38,477,359 shares

MEETME, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2013

TABLE OF CONTENTS

	Page

PART I. FINANCIAL INFORMATION
Item 1 Financial Statements (Unaudited):	3
Consolidated Balance Sheets	3
Consolidated Statements of Operations and Comprehensive Income (Loss)	4
Consolidated Statement of Changes in Stockholders’ Equity	5
Consolidated Statements of Cash Flows	6
Notes to Consolidated Financial Statements	7
Item 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3 Quantitative and Qualitative Disclosures about Market Risk	38
Item 4 Controls and Procedures	38
PART II. OTHER INFORMATION
Item 1 Legal Proceedings	39
Item 1A Risk Factors	39
Item 2 Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 3 Defaults Upon Senior Securities	39
Item 4 Mine Safety Disclosures	39
Item 5 Other Information	39
Item 6 Exhibits	40
SIGNATURES
INDEX TO EXHIBITS

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

MEETME, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30, 2013			December 31, 2012
Assets
Current Assets
Cash and cash equivalents	$	8,682,241		$	5,022,007
Accounts receivable, net of allowance of $457,000 and $547,000, at September 30, 2013 and December 31, 2012, respectively		7,374,957			15,744,789
Notes receivable		-			111,569
Prepaid expenses and other current assets		581,471			870,881
Total current assets		16,638,669			21,749,246

Goodwill		70,646,036			70,646,036
Intangible assets, net		5,277,524			6,746,273
Property and equipment, net		3,468,585			4,772,632
Other assets		309,196			520,480
Total assets	$	96,340,010		$	104,434,667

Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable	$	2,432,890		$	3,528,607
Accrued expenses and other liabilities		4,428,269			3,211,681
Current liabilities from discontinued operations		-			1,434
Deferred revenue		884,374			392,612
Accrued dividends		69,455			69,455
Current portion of long-term debt		3,429,458			2,551,941
Total current liabilities		11,244,446			9,755,730

Long term debt, net of discount		3,983,067			9,156,788
Total liabilities		15,227,513			18,912,518

Commitments and Contingencies (see Note 9)

Stockholders' Equity:
Preferred stock, $.001 par value, authorized 5,000,000 shares: Convertible preferred stock Series A-1, $.001 par value; authorized – 1,000,000 shares; 1,000,000 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively		1,000			1,000
Common stock, $.001 par value; authorized - 100,000,000 shares; 38,477,359 and 37,046,405 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively		38,481			37,050
Additional paid-in capital		281,791,267			275,261,794
Accumulated deficit		(200,125,365	)		(189,211,750	)
Accumulated other comprehensive loss		(592,886	)		(565,945	)
Total stockholders’ equity		81,112,497			85,522,149
Total liabilities and stockholders’ equity	$	96,340,010		$	104,434,667

The accompanying notes are an integral part of these consolidated financial statements.

MEETME, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012

Revenues	$	10,073,309		$	11,598,432		$	27,361,901		$	35,049,022
Operating Costs and Expenses:
Sales and marketing		1,876,240			2,656,955			5,405,910			6,099,594
Product development and content		6,817,591			7,883,987			19,543,611			22,605,195
General and administrative		1,536,939			2,001,950			5,759,498			6,325,796
Depreciation and amortization		1,108,856			1,025,421			3,280,843			2,888,960
Restructuring costs		-			353,555			2,540,896			891,499
Loss on debt restructure		-			-			1,174,269			-
Total Operating Costs and Expenses		11,339,626			13,921,868			37,705,027			38,811,044
Loss from Operations		(1,266,317	)		(2,323,436	)		(10,343,126	)		(3,762,022	)
Other Income (Expense), net:
Interest income		2,503			3,866			7,856			13,758
Interest expense		(222,777	)		(280,852	)		(578,345	)		(867,136	)
Other income net		-			8,581			-			9,611
Total other expense		(220,274	)		(268,405	)		(570,489	)		(843,767	)
Loss before income taxes		(1,486,591	)		(2,591,841	)		(10,913,615	)		(4,605,789	)
Income taxes		-			-			-			-
Net loss from continuing operations	$	(1,486,591	)	$	(2,591,841	)	$	(10,913,615	)	$	(4,605,789	)
Loss from discontinued operations, net of taxes	$	-		$	-		$	-		$	(3,680,627	)
Net Loss Allocable To Common Shareholders	$	(1,486,591	)	$	(2,591,841	)	$	(10,913,615	)	$	(8,286,416	)

Basic and diluted net loss per common shareholders:
Continuing operations	$	(0.04	)	$	(0.07	)	$	(0.29	)	$	(0.13	)
Discontinued operations	$	-		$	-		$	-		$	(0.10	)
Basic and diluted net loss per common shareholders	$	(0.04	)	$	(0.07	)	$	(0.29	)	$	(0.23	)
Weighted Average Number of Shares Outstanding, Basic and Diluted:		38,207,141			36,436,353			37,903,904			36,306,242

Net Loss	$	(1,486,591	)	$	(2,591,841	)	$	(10,913,615	)	$	(8,286,416	)
Foreign currency translation, net		1,473			(9,493	)		(26,941	)		(101,918	)
Comprehensive Loss	$	(1,485,118	)	$	(2,601,334	)	$	(10,940,556	)	$	(8,388,334	)

The accompanying notes are an integral part of these consolidated financial statements.

MEETME, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2013

(Unaudited)

	Preferred Stock				Common Stock				Additional Paid-in		Accumulated			Accumulated Other Comprehensive			Total Stockholders'
	Shares		Amount		Shares		Amount		Capital		Deficit			Loss			Equity
Balance—December 31, 2012		1,000,000	$	1,000		37,046,405	$	37,050	$	275,261,794	$	(189,211,750	)	$	(565,945	)	$	85,522,149
Vesting of stock options for compensation		-		-		-		-		2,761,566		-			-			2,761,566
Issuance of warrants with debt		-		-		-		-		290,748		-			-			290,748
Issuance of stock in connection with convertible debt		-		-		306,122		306		599,694		-			-			600,000
Exercise of stock options		-		-		122,685		123		122,563		-			-			122,686
Exercise of warrants		-		-		1,002,147		1,002		2,754,902		-			-			2,755,904
Foreign currency translation, net		-		-		-		-		-		-			(26,941	)		(26,941	)
Net loss		-		-		-		-		-		(10,913,615	)		-			(10,913,615	)

Balance—September 30, 2013		1,000,000	$	1,000		38,477,359	$	38,481	$	281,791,267	$	(200,125,365	)	$	(592,886	)	$	81,112,497

The accompanying notes are an integral part of these consolidated financial statements.

MEETME, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine Months Ended September 30,
	2013			2012
Cash flows from operating activities:
Net loss from continuing operations	$	(10,913,615	)	$	(4,605,789	)
Adjustments to reconcile net loss to net cash provided (used) by operating activities:
Depreciation and amortization		3,280,843			2,888,960
Loss on debt restructure, net		1,066,765			-
Stock based compensation		2,761,566			2,905,155
Loss on disposal of property and equipment		-			11,038
Grant income		-			(9,556	)
Bad debt expense (recovery)		(90,000	)		251,300
Amortization of discounts on notes payable and debt issuance costs		80,332			218,757
Changes in operating assets and liabilities:
Accounts receivable		2,426,771			(4,873,176	)
Prepaid expenses, other current assets, and other assets		650,190			(135,339	)
Restricted cash		-			275,000
Accounts payable and accrued expenses		958,364			3,382,625
Deferred revenue		491,762			237,994
Net cash provided by continuing operating activities		712,978			546,969
Net cash used by discontinued operations:		-			(1,203,178	)
Net cash provided (used) by operating activities		712,978			(656,209	)
Cash flows from investing activities:
Purchase of property and equipment		(128,515	)		(492,041	)
Purchase of trademarks		-			(125,000	)
Loan payments from BRC		111,569			44,031
Net cash used by investing activities		(16,946	)		(573,010	)
Cash flows from financing activities:
Proceeds from exercise of stock options		122,686			630,228
Proceeds from the issuance of debt		5,000,000			-
Payments of capital leases		(566,103	)		(237,569	)
Payments of dividends		-			(100,000	)
Payments on debt		(1,573,906	)		(1,854,651	)
Net cash provided (used) by financing activities		2,982,677			(1,561,992	)
Change in cash and cash equivalents prior to effect of exchange rate changes		3,678,709			(2,791,211	)
Effect of exchange rate changes		(18,475	)		(4,534	)
Net increase (decrease) in cash and cash equivalents		3,660,234			(2,795,745	)
Cash and cash equivalents at beginning of the period		5,022,007			8,271,787
Cash and cash equivalents at end of period	$	8,682,241		$	5,476,042

Supplemental Disclosure of Cash Flow Information:
Cash paid for interest	$	127,486		$	563,826
Cash paid for income taxes	$	-		$	-

Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Purchase of property and equipment through capital leases	$	498,659		$	1,758,816
Subordinated note payable and accounts receivable offset	$	6,025,898		$	-
Warrant exercises and subordinated notes payable cancellations	$	2,756,210		$	-
Issuance of convertible note payable for settlement loss contingency for trademark dispute	$	600,000		$	-
Issuance of warrants and valuation discount on debt	$	290,748		$	-

The accompanying notes are an integral part of these consolidated financial statements.

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013

(Unaudited)

Note 1—Description of Business and Basis of Presentation

Description of Business

MeetMe, Inc. (the “Company”, “MeetMe”, “we”, “us”, or “our”), was incorporated in Nevada in June 1997. On December 6, 2011, the Company changed its legal domicile to Delaware. Effective June 1, 2012, the Company changed its name from Quepasa Corporation. The Company is a social media technology company which owns and operates MeetMe.com, previously known as myYearbook.com and Quepasa.com that completed its transition to MeetMe.com in the fourth quarter of 2012.

MeetMe is a social network for meeting new people both on the web and using its mobile applications on iPhone, Android, iPad and other tablets that facilitate interactions among users and encourage users to connect with each other. MeetMe monetizes through advertising, virtual currency, and paid subscriptions. MeetMe provides users with access to an expansive, multilingual menu of resources that promote social interaction, information sharing and other topics of interest to users. The Company offers online marketing capabilities, which enable marketers to display their advertisements in different formats and in different locations. The Company works with its advertisers to maximize the effectiveness of their campaigns by optimizing advertisement formats and placement.

The Company acquired XtFt Games S/S Ltda (“XtFt”), on March 2, 2011. On July 14, 2011, XtFt’s name was changed to Quepasa Games S/S Ltda (“Quepasa Games”). The Company’s wholly owned Brazilian based subsidiary, Quepasa Games, managed games development and the creation of intellectual properties business. On June 30, 2012, the Company discontinued the games development business and creation of intellectual properties business of Quepasa Games. On July 14, 2012 the corporate shell of Quepasa Games S/S Ltda was renamed MeetMe Online Brasil S/S Ltda and is focused on advertising sales in the Sao Paolo, Brazil office.

On November 10, 2011, the Company, IG Acquisition Company (“Merger Sub”), a wholly-owned subsidiary of the Company, and Insider Guides, Inc. (“Insider Guides”), doing business as myYearbook.com (“myYearbook”), closed a merger pursuant to which myYearbook merged with and into Merger Sub (the “Merger”). Insider Guides operated a social networking website, www.myyearbook.com. As Merger consideration, the security holders of myYearbook securities received approximately $18 million in cash and approximately 17 million shares of the Company common stock (not including cash for fractional shares), Merger Sub changed its name to Insider Guides, following the Merger, and legally merged into MeetMe, Inc. effective as of January 1, 2012.

Basis of Presentation

The consolidated financial statements have been prepared by the Company, without audit, pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). The Company prepares its unaudited consolidated financial statements in conformity with generally accepted accounting principles in the United States (“GAAP”). These principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position of the Company as of September 30, 2013 and its statements of operations, comprehensive loss and cash flows for the three and nine months ended September 30, 2013. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes thereto contained in the Company’s 2012 Annual Report filed on Form 10-K with the SEC on March 14, 2013.

Principles of Consolidation

The unaudited consolidated financial statements include the accounts of MeetMe and its wholly-owned subsidiaries, Quepasa.com de Mexico, Quepasa Serviços em Solucoes de Publicidade E Tecnologia Ltda (inactive), MeetMe Online S/S Ltda (formerly Quepasa Games S/S Ltda from March 2, 2011), and Insider Guides (from November 10, 2011 until its merger into MeetMe, Inc. effective as of January 1, 2012). All intercompany accounts and transactions have been eliminated in consolidation. On June 30, 2012, the Company discontinued its game development and creation of intellectual properties business. Accordingly, games operations have been classified as discontinued operations for all periods presented.

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 1—Description of Business and Basis of Presentation - continued

Reclassifications

Certain prior period amounts in the consolidated financial statements have been reclassified to conform to the current period’s presentation. Reclassification adjustments for discontinued operations were made to the consolidated balance sheets and statements of operations for the periods presented.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Most significant estimates in the accompanying unaudited consolidated financial statements include revenue recognition, the allowance on accounts receivable, valuation of notes receivable, valuation of deferred tax assets, valuation of stock-based employee and non-employee awards, valuation of warrants issued with debt, valuation of assets acquired and liabilities assumed in business combinations, evaluating goodwill, intangible and long-lived assets for impairment, useful lives of intangibles assets and property and equipment, and the measurement and accrual of restructuring costs and contingent liabilities. The Company bases its estimates on historical experience and on various other assumptions that the Company believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Note 2 —Summary of Significant Accounting Policies

The Company’s significant accounting policies are described in Note 1 of the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.

Recently Issued Accounting Standards

During the quarter ended September 30, 2013, there were no new accounting pronouncements or updates to recently issued accounting pronouncements disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 that affect the Company’s present or future results of operations, overall financial condition, liquidity or disclosures.

Note 3 —Discontinued Operations – Quepasa Games

The games development business of our Brazilian subsidiary, Quepasa Games, were discontinued on June 30, 2012 in order to streamline efforts to improve efficiencies, reduce costs and focus on the Company’s core social network business. In connection with this closure, the Company transferred the hosting responsibilities of its games Wonderful City Rio and Amazon Alive to third parties, Quepasa Games office in Curitiba, Brazil was closed and all Quepasa Games employees were terminated. The games business closure qualifies as a discontinued operation and accordingly the Company has excluded results for Quepasa Games operations from its continuing operations in the Consolidated Statement of Operations for all periods presented.

The following table shows the results of Quepasa Games included in the loss from discontinued operations:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Games Revenues	$	-	$	-	$	-	$	840,190
Games Expenses		-		-		-		1,032,366
Product development and content		-		-		-		552,563
Depreciation and amortization		-		-		-		16,102
Exit costs		-		-		-		431,418
Loss on disposable of assets		-		-		-		48,084
Stock-based compensation		-		-		-		151,508
Loss on impairment of goodwill		-		-		-		2,288,776
Total		-		-		-		4,520,817
Loss from discontinued operations attributable to Quepasa Games	$	-	$	-	$	-	$	(3,680,627	)

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 4—Notes Receivable

In February 2010, the Company entered into a settlement agreement (the “Settlement”) with BRC Group LLC (“BRC”) effective as of September 22, 2009. Under the Settlement, BRC’s indebtedness to the Company was reduced from $350,000 to $250,000, evidenced by a new promissory note (the “BRC Note”) dated September 22, 2009. The BRC Note contains a repayment term of 18 months commencing June 1, 2011, bearing interest at the rate of 4% per annum, such interest to begin accruing February 1, 2011. As collateral for the BRC Note, BRC issued us a warrant (the “Warrant”) permitting us to receive up to a 30% membership interest in BRC upon default. If BRC defaults under the BRC Note and the Warrant is exercised, BRC shall have 90 days to repurchase the membership interest for the balance of the remaining principal and interest to date. As a result of the Settlement and the BRC Note, both parties agreed to a mutual release of the current litigation between the parties by filing a dismissal of the litigation with prejudice. Furthermore, both parties agreed to terminate all prior agreements between each other entered into before September 22, 2009, along with all duties rights and obligations thereunder. During the third quarter of 2013 BRC’s obligation to the Company pursuant to the BRC Note receivable has been met. Therefore, BRC will not be required to make any future payments under the agreement.

Note 5—Goodwill

The Company’s goodwill represents the fair value of the intangible assets, not subject to amortization, from the acquisitions of Quepasa Games and Insider Guides. At December 31, 2011, management assessed relevant events and circumstances in evaluating whether it was more likely than not that its fair values were less than respective carrying amounts of the acquired subsidiaries pursuant to ASC 350 Intangibles, Goodwill and Other . After evaluation of Quepasa Games’ performance for the period ended December 31, 2011 and projected 2012 performance, management determined that Quepasa Games could not achieve the performance necessary for the earn-out provision of the stock-purchase agreement and would require an impairment adjustment. A valuation of Quepasa Games was performed and a $2.5 million fair value was determined. A comparison of the Company’s approximately $3.8 million carrying value of the Quepasa Games and the $2.4 million implied value of goodwill resulted in a loss on impairment of approximately $1.4 million in 2011. Quepasa Games operations were discontinued on June 30, 2012 and accordingly a loss on impairment of goodwill of approximately $2.2 million was recorded as loss from discontinued operations for the year ended December 31, 2012. The translated value of goodwill for Quepasa Games varied at each interim reporting period due to changes in the foreign exchange rates.

Management’s assessment of the events and circumstance since the acquisition of Insider Guides shows positive operating performance, key metrics, customer retention, and no indicators that its fair value was less than its carrying amount at December 31, 2012. No impairment to goodwill occurred during the nine months ended September 30, 2013 and year ended December 31, 2012 for Insider Guides.

Goodwill consists of the following:

	Continuing operations		Discontinued operations
Goodwill, opening balance January 1, 2011	$	-	$	-
Additions:
Goodwill, Quepasa Games		-		4,280,618
Goodwill, translation adjustments		-		(469,045	)
Goodwill, Insider Guides		70,646,036		-
Less impairment losses for Quepasa Games		-		(1,409,127	)

Total Goodwill—net at December 31, 2011	$	70,646,036	$	2,402,446

Additions:
Goodwill, translation adjustments		-		(113,670	)
Less impairment losses for Quepasa Games		-		(2,288,776	)
Total Goodwill—net at December 31, 2012	$	70,646,036	$	-

Less impairment losses		-		-
Total Goodwill—net at September 30, 2013	$	70,646,036	$	-

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 6—Intangible Assets

Intangible assets consist of the following:

	September 30, 2013			December 31, 2012

Trademarks and domains names	$	6,124,994		$	6,124,994
Advertising customer relationships		1,165,000			1,165,000
Mobile applications		1,725,000			1,725,000
		9,014,994			9,014,994
Less accumulated amortization		(3,737,470	)		(2,268,721	)
Intangible assets—net	$	5,277,524		$	6,746,273

Note 7—Property and Equipment

Property and equipment consist of the following:

	September 30, 2013			December 31, 2012

Servers and computer equipment and software	$	7,285,907		$	6,805,099
Office furniture and equipment		152,064			143,037
Leasehold Improvements		373,399			367,437
Property and equipment		7,811,370			7,315,573
Less accumulated depreciation		(4,342,785	)		(2,542,941	)
Property and equipment—net	$	3,468,585		$	4,772,632

Note 8— Long Term Obligations

Senior Loans Payable

On November 10, 2011, in conjunction with the acquisition of Insider Guides, the Company assumed loans payable consisting of a growth capital term loan and three equipment term loans. The loans payable are collateralized by substantially all the assets of the Company. Under the Loan and Security Agreement Number 2 (“LSA2”) growth term and equipment term loans, dated December 13, 2010, principal and interest are payable monthly at a fixed interest rate of 12.50% per annum, and the loans are due September 2014. Under the Supplemental Loan and Security Agreement (“SLSA”), dated November 21, 2008, principal and interest are payable monthly at a fixed interest rate of 12.60% per annum, and the loan was repaid by April 2012. Under the Supplement Number 2 Loan and Security Agreement (“S2LSA”) dated January 22, 2010, principal and interest are payable monthly at a fixed interest rate of 12.50% per annum, and the loan is due June 2013. On February 13, 2012, the loans payable and security agreements were amended and restated to include additional debt covenants. The amendment includes limitations of additional $6 million of bank borrowing and indebtedness for leased office equipment. The amendment requires that the Company’s unrestricted cash and accounts receivable be greater than or equal to 200% of the borrowers indebtedness and the Company’s unrestricted cash be greater than or equal to the aggregate amount of interest that will accrue and be payable through the maturity date of loans payable and security agreement. At September 30, 2013, the Company was in compliance with the amended loans payable and security agreements debt covenants.

On April 29, 2013 , the Company entered into an $8.0 million loan and security agreement with Value Lending & Leasing VI, Inc. and Value Lending and Leasing VII, Inc., at 11% fixed interest rate, maturing in 36 months, and which may be drawn in three tranches (the “Loan”). On April 29, 2013, the Company drew $5.0 million on the facility. Interest is payable monthly for the first six months of the loan term, and monthly principal and interest payments are due thereafter through the maturity date. The Company issued warrants to each of the lenders in conjunction with the loan facility with an initial aggregate exercise price of $400,000 , which increased by $100,000 with the first tranche and increases by $150,000 with the second and third tranche draw down of the Loan. The Loan payable is net of the discount of valuation on the related warrants (See Note 14). The discount is amortized on the straight-line basis over the 36 month debt term. The lenders will have a priority first security lien on substantially all assets of the Company. At September 30, 2013, the Company was in compliance with the debt covenants related to the Loan .

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 8— Long Term Obligations - continued

	September 30, 2013
Growth capital loan payable, face amount	$	5,000,000
Discount:
Valuation of warrants		(290,748	)
Accumulated amortization		33,228
Total discounts		(257,520	)
Growth capital loan payable, net	$	4,742,480

Subordinated Notes Payable

On January 25, 2008, the Company entered into a Note Purchase Agreement (the “MATT Agreement”) with Mexicans & American Trading Together, Inc. (“MATT”). Pursuant to the terms of the MATT Agreement: (i) MATT invested $5,000,000 in the Company and the Company issued MATT a subordinated promissory note due October 16, 2016 with 4.46% interest per annum (the “MATT Note”); (ii) the exercise price of MATT’s outstanding Series 1 Warrant to purchase 1,000,000 shares of our common stock was reduced from $12.50 per share to $2.75 per share; (iii) the exercise price of MATT’s outstanding Series 2 Warrant to purchase 1,000,000 shares of our common stock was reduced from $15.00 per share to $2.75 per share (see Note 14); and (iv) the Amended and Restated Support Agreement between the Company and MATT was terminated, which terminated MATT’s obligation to provide us with the use of a corporate jet for up to 25 hours per year through October 2016. Debt issuance costs of $24,580 related to this transaction have been capitalized within the other assets section of the balance sheet were amortized to interest expense over the life of the note. The balance of deferred debt issuance costs was approximately $11,000 at December 31, 2012 and was included in other assets.

On March 5, 2013, the Company, Altos Hornos de Mexico, S.A.B. de C.V. (“AHMSA”) and MATT entered into an agreement to offset the MATT Note with approximately $6 .0 million of accounts receivable that MATT and AHMSA owed to the Company (the “Receivable”). As of March 5, 2013, $6,254,178 in principal and accrued interest was outstanding under the MATT Note, and the Receivable had a balance of $6,025,828 plus interest of $222,446 from the agreement. MATT exercised warrants dated October 17, 2006 at an exercise price of $2.75 per share (the “MATT Warrants”) to purchase 2,147 shares of common stock using the amount by which the outstanding principal and accrued interest under the Note exceeded the amount of the Receivable. As a result of these transactions, both the MATT Note and the Receivable have been deemed fully satisfied. In connection therewith, MATT has agreed to exercise or forfeit the MATT Warrants with an aggregate exercise price of $2,000,000 over an eleven-month period beginning in March 2013. The Company recorded a net loss on debt restructure of approximately $712,000 in connection with the debt offset and warrant, attributable to the write-off of unamortized discounts and debt issue costs at the date of the agreement.

MATT Note payable consisted of the following:

	September 30, 2013		December 31, 2012
Notes payable, face amount	$	-	$	5,000,000
Discounts on notes:
Revaluation of warrants		-		(1,341,692	)
Termination of jet rights		-		(878,942	)
Accumulated amortization		-		1,255,596
Total discounts		-		(965,038	)
Accrued interest		-		1,204,980
MATT Note payable, net	$	-	$	5,239,942

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 8— Long Term Obligations - continued

On January 25, 2008, the Company entered into a Note Purchase Agreement (the “RSI Agreement”) with Richard L. Scott Investments, LLC (“RSI”). Pursuant to the terms of the RSI Agreement: (i) RSI invested $2,000,000 in the Company and the Company issued RSI a subordinated promissory note due March 21, 2016 with 4.46% interest per annum (the “RSI Note”); (ii) the exercise price of RSI’s outstanding Series 2 Warrant to purchase 500,000 shares of our common stock was reduced from $4.00 per share to $2.75 per share, (See Note 14); and (iii) the exercise price of RSI’s outstanding Series 3 Warrant to purchase 500,000 shares of our common stock was reduced from $7.00 per share to $2.75 per share. Debt issuance costs of $15,901 related to this transaction have been capitalized within the Other Assets section of the balance sheet and were amortized to interest expense over the life of the RSI Note. The balance of deferred debt issuance costs was approximately $6,300 at December 31, 2012 and was included in other assets.

On March 5, 2013, the Company and RSI entered into an agreement pursuant to which RSI exercised warrants dated as of March 21, 2006 to purchase one million shares of common stock at an exercise price of $2.75 per share (the “RSI Warrants”). RSI paid the exercise price of the RSI Warrants by offsetting that same amount under the RSI Note. The Company paid RSI $107,504 in cash, which represented the difference between the aggregate exercise price of the RSI Warrants of $2,750,000, and the total amount of principal and interest under the RSI Note that would have accrued through the 2016 due date of $2,857,504. As a result of these transactions, the RSI Warrants have been fully exercised and are of no further force or effect and the RSI Note has been deemed fully satisfied. The Company recorded a net loss on debt restructure of approximately $463,000 in connection with the warrant exercise and debt cancellation, attributable to the write-off of unamortized discounts and debt issue costs, and accelerated interest at the date of the agreement.

RSI note payable consisted of the following:

	September 30, 2013		December 31, 2012
Notes payable, face amount	$	-	$	2,000,000
Discounts on notes:
Revaluation of warrants		-		(263,690	)
Accumulated amortization		-		159,560
Total discounts		-		(104,130	)
Accrued interest		-		481,993
RSI Notes payable, net	$	-	$	2,377,863

Convertible Note Payable

On March 21, 2013, the Company issued a non-interest bearing $600,000 note payable to a third party, maturing six months from the origination date, in settlement of a trademark dispute. The note payable is convertible solely at the option of the Company into shares of its common stock. The Company had the option to convert as a whole or in part up to the entire amount outstanding under the note payable into Company’s common stock at a conversion price equal to the volume weighted average trading price of the Company’s stock for the five trading days immediately prior to the date of conversion notice. During the third quarter of 2013, the Company executed its option to convert in whole the entire amount outstanding under the note payable into the Company’s common stock at $1.96 per share resulting in the issuance of 306,122 shares of common stock of the Company. Therefore the Company is no longer under any obligation pursuant to the convertible note agreement.

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 8— Long Term Obligations - continued

Capital Leases

During the first quarter 2012, the Company executed two non-cancelable master lease agreements one for $1.5 million with Dell Financial Services, and one for $500,000 with HP Financial Services. Both are for the purchase or lease of equipment for our data centers. The HP Financial Services master lease agreement increased to approximately $1.7 million in the second quarter 2013 with approximately $330,000 new leases offset by payments. The Company and HP Financial Services periodically evaluate the master lease borrowing limits and increase amount as necessary. Principal and interest are payable monthly at interest rates of ranging from 4.5% to 7.99% per annum, rates varying based on the type of equipment purchased. The capital leases are secured by the leased equipment, and outstanding principal and interest are due through September 2016.

The following is a schedule of debt:

Borrowings

Interest

Rates

September 30,

2013

December 31,

2012

Growth term loans:

LSA2

$

97,500

12.50%

$

-

$

125,679

Equipment term loans:

SLSA

2,500,000

12.60%

-

-

S2LSA

2,500,000

12.50%

26,259

496,381

LSA2

8,607

12.50%

831,060

1,762,061

Growth capital loan

5,000,000

11.00%

4,952,896

-

Less: unamortized discount

-

(257,520)

-

10,106,107

5,552,695

2,384,121

Capital leases

6.46%

-

7.99%

1,662,436

1,397,970

4.50%

-

7.40%

197,396

308,833

1,859,832

1,706,803

Loans payable - current portion

2,517,856

1,903,368

Capital lease - current portion

911,602

648,573

Long term debt - current portion

$

3,429,458

$

2,551,941

Loans payable - long term portion

$

3,034,837

$

480,753

MATT note payable

$5,000,000

4.46%

-

5,000,000

RSI note payable

2,000,000

4.46%

-

2,000,000

3,034,837

7,480,753

Add: accrued interest

-

1,686,973

Less: unamortized discounts

-

(1,069,168

)

Total notes payable - long term portion

3,034,837

8,098,558

Capital lease - long term portion

948,230

1,058,230

Long term debt, net of discounts

$

3,983,067

$

9,156,788

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 9—Commitments and Contingencies

Commitments

Operating Leases

The Company leases its operating facilities in the United States of America, and Sao Paulo, Brazil, under operating leases and accordingly rent is expensed as incurred. Rent expense from operations was $537,452 and $521,127 for the three-month periods ended September 30, 2013 and 2012, respectively. Rent expense from operations was $1,610,488 and $1,514,837, respectively, for the nine-month periods ended September 30, 2013 and 2012.

The Company’s future annual minimum lease payments for each of the following calendar years are as follows:

September 30, 2013

Payments

Remainder of 2013
$ 510,250

2014
998,294

2015
459,387

2016
467,182

2017
114,981

Thereafter
-

Total minimum payments
$ 2,550,094

Restructuring Costs

On November 16, 2011, management announced a restructure plan consolidating operations. Restructuring costs include the employee relocation expenses, severance costs of terminated employees, the costs of contractual termination benefits and future service required payments, and exit costs of office, data and service center closures. Employee relocation expenses and severance costs are expensed as incurred and classified as acquisition and restructuring costs. During the second quarter of 2013, the Company announced a cost reduction initiative, including a workforce reduction of 15%. In addition, the Company implemented the workforce reduction and initiated further cost reductions by closing certain satellite offices and consolidating real estate facilities. The Company recorded restructuring costs of $2.5 million within operating expense related to the exit costs of non-cancellable leases and workforce reduction costs excluding the impact of stock based compensation expense reversals associated with employee terminations resulting from the restructure. Accrued restructuring expenses were approximately $2.0 million and $224,000 at September 30, 2013 and December 31, 2012, respectively. The Company expects to pay approximately $1.8 million of the accrued restructuring expenses in severance and related employee exit costs to its former Chief Executive Officer and Chief Financial Officer during the remainder 2013.

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 9—Commitments and Contingencies - continued

Contingencies

Litigation

From time to time, we are party to certain legal proceedings that arise in the ordinary course and are incidental to our business. We operate our business online, which is subject to extensive regulation by federal and state governments. In July 2011, the Company received a subpoena from the New York Attorney General (“NYAG”) seeking records relating to our operations including specifically our e-mail marketing practices. Our attorneys advised us that federal law preempted the NYAG’s inquiry in the absence of any deceptive acts, and that they did not believe our e-mail marketing involved any deceptive practices. Nevertheless, we chose to cooperate fully with the NYAG and made certain changes to our email practices on Quepasa.com to address the concerns. On August 15, 2012, we entered into an Assurance of Discontinuance with NYAG, agreed to pay $20,000 to NYAG, and agreed to comply with the State of New York laws and industry practices regarding certain e-mail marketing campaigns. The Company charged this expense to general and administrative expenses for year ended December 31, 2012. The NYAG agreed to discontinue its investigation.

On November 18, 2011, Jeffrey Valdez, a former member of the Company’s Board of Directors who was also a paid consultant to the Company sued the Company in the Superior Court of California for breach of contract relating to the ownership and use of certain intellectual property that he allegedly created. The plaintiff also claimed that the Company and John Abbott, its Chief Executive Officer, never intended to honor the contract. The Company denied these allegations and maintained that the plaintiff did not create any original intellectual property and that the Company was not otherwise using any intellectual property created by the plaintiff. The Court granted the Company’s motion to dismiss Valdez’s claim that the Company fraudulently induced him to enter into the Consulting Agreement. The Court also dismissed the claim against Mr. Abbott. On June 25, 2012, the Company entered into a settlement agreement and made a $150,000 payment to the plaintiff for release of all claims and charged this expense to general and administrative expenses for the year ended December 31, 2012. Accordingly, the United States District Court in the Central District of California issued an Order to Dismiss with Prejudice on July 2, 2012.

On September 8, 2011, Stacey Caplan, a former employee of the Company, filed a complaint with the Equal Employment Opportunity Commission (“EEOC”) alleging sexual discrimination by the Company in the period following her voluntary resignation from the Company. The Company denied the allegations. On July 6, 2012, the EEOC found the complaint unfounded and closed its file. On January 28, 2013, Stacey Caplan sued the Company and its Chief Financial Officer, Michael Matte, in the Florida Circuit Court for Palm Beach County for alleged unlawful discrimination on the basis of sex and tortious interference with contractual relations. On April 17, 2013 the Court dismissed the plaintiff’s tortious interference claims against the Company, and April 19, 2013 the plaintiff withdrew its claims against Mr. Matte. The Company believes the plaintiff’s claims are without merit and intends to defend against them vigorously.

By letter dated October 23, 2012, a third party accused the Company of breach of contract and infringement of trademark. The Company recorded a contingent liability of $1 million for the probable settlement of this matter to accrued expense and other liabilities and charged this expense to general and administrative expenses for the year ended December 31, 2012. In settlement of the matter, on March 21, 2013 the Company paid $400,000 to the third party and issued a non- interest bearing $600,000 note payable that was convertible solely at the option of the Company into shares of its common stock (see Note 8).

Future events or circumstances, currently unknown to management, will determine whether the resolution of pending or threatened litigation or claims will ultimately have a material effect on our consolidated financial position, liquidity or results of operations in any future reporting periods.

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 10—Convertible Preferred Stock

On June 30, 2008, the Company entered into a transaction with Mexicans & Americans Thinking Together Foundation, Inc. (the “Organization”) terminating the Corporate Sponsorship and Management Services Agreement (the “CSMSA”). In consideration for the Transaction, the Company issued the Organization 25,000 shares of Series A Preferred Stock, par value $0.001, (the “Original Series A”). Dividends on the Original Series A accrued from the date of issuance at the rate per annum of 4.46% on the Stated Value ($100 per share) and were cumulative. On May 12, 2011 the preferred stock was converted to 336,927 of common shares at the election of the Organization and dividend accrual terminated at the date of the conversion. On August 22, 2011, November 28, 2011, and January 18, 2012, $100,000, $50,000, and $100,000 respectively, partial dividend payments were made to the Organization. Accrued dividends were $69,455 at September 30, 2013 and December 31, 2012, respectively.

On September 20, 2011, the Company amended the rights and preferences of the Original Series A (“Series A”). The Company sold 1,000,000 shares of new Series A convertible preferred for $5,000,000 to Harvest Small Cap Partners Master, LTD and Harvest Small Cap Partners, LP (collectively “Harvest’). The new Series A shares were convertible at a conversion price per share based on the following: the lower of (i) $3.5785 or (ii), if the Merger of the Company and myYearbook closed, the lower of (A) 85% of the closing price of the Company’s common stock on the closing date of the Merger or (B) 85% of the volume weighted average price during the 20 trading days ending with the date of the closing of the Merger. On November 10, 2011, Harvest converted the Series A into 1,479,949 shares of the Company’s common stock, at a purchase price per share of approximately $3.38.

In connection with the closing of the Merger, the Company sold 1,000,000 shares of Series A-1 Preferred Stock (“Series A-1”) to MATT for $5,000,000. MATT was an existing stockholder of the Company. The Series A-1 shares are convertible, at MATT’s option, into 1,479,949 shares of the Company’s common stock, at a purchase price per share of approximately $3.38, and have voting rights on as converted basis.

Note 11—Common Stock

The Company issued 122,685 shares of common stock in connection with the exercises of stock options during the nine months ended September 30, 2013 (see Note 13). During the nine months ended September 30, 2013, the Company issued 1,002,147 common shares in connection with the exercises of warrants (see Note 14) and 306,122 common shares to MEETMOI as a result of the conversion of the note payable to shares of the Company’s common stock (see Note 8).

Note 12—Earnings (Loss) per Common Share

The Company computes and presents net earnings (loss) per share using the treasury stock method. Net earnings (loss) per common share, or basic loss per share, is computed by dividing net earnings (loss) by the weighted average number of the Company’s common shares outstanding. Net earnings (loss) per common share assuming dilutions, or diluted earnings (loss) per share is computed by reflecting the potential dilution from the exercise of in-the-money stock options, unvested restricted stock, warrants and convertible preferred stock.

At September 30, 2013 and 2012 all potentially dilutive securities, in-the-money stock options unvested restricted stock, warrants and convertible preferred stock, were excluded from the computation of diluted earnings (loss) per share as their effect would have been anti-dilutive, since the Company reported a net loss for these periods.

The following table summarizes the number of dilutive securities, which may dilute future earnings per share, outstanding as of the dates presented, but not included in the calculation of diluted loss per share:

	September 30,		September 30,
	2013		2012
Stock options		8,997,696		9,651,657
Unvested Restricted Stock Awards		1,365,500		-
Warrants		3,052,953		4,200,000
Convertible preferred stock		1,479,949		1,479,949
Totals		14,896,098		15,331,606

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 13—Stock-Based Compensation

The fair values of share-based payments related to stock options are estimated on the date of grant using the Black-Scholes option pricing model, based on weighted average assumptions. Expected volatility is based on historical volatility of our common stock. The risk-free rate is based on the U.S. Treasury yield curve in effect over the expected term at the time of grant. Stock based compensation expense for stock options is recognized on a straight-line basis over the requisite service period of the award. During 2013 and 2012, the Company continued to use the simplified method to determine the expected option term since our stock option exercise experience does not provide a reasonable basis upon which to estimate the expected option term.

The Company began granting restricted stock awards (“RSAs”) to its employees in April 2013. The cost of the RSAs is determined using the fair value of the Company’s common stock on the date of grant. Stock-based compensation expense for RSAs is amortized on a straight-line basis over the requisite service period. RSAs generally vest over a three-year period with 33% vesting at the end of one year and the remaining vesting quarterly or annually thereafter.

The assumptions used in calculating the fair value of stock-based awards represent our best estimates, but these estimates involve inherent uncertainties and the application of management judgment. As a result, if factors change and the Company uses different assumptions, our stock-based compensation expense could be materially different in the future.

Stock based compensation expense includes incremental stock-based compensation expense as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Sales and marketing	$	103,521	$	95,399	$	266,663	$	256,662
Product development and content		583,523		475,616		1,175,680		1,426,332
General and administrative		163,598		455,555		1,319,223		1,222,161
Total stock-based compensation for continuing operations		850,642		1,026,570		2,761,566		2,905,155
Total stock-based compensation for discontinued operations		-		-		-		151,506
Total stock-based compensation for vesting of options and awards	$	850,642	$	1,026,570	$	2,761,566	$	3,056,661

As of September 30, 2013, there was approximately $3.7 million of total unrecognized compensation expense related to stock options which will be recognized over a period of less than two years. As of September 30, 2013, the Company had approximately $2.1 million of unrecognized stock-based compensation expense related to RSAs, which will be recognized over the remaining weighted-average vesting period of approximately 3 years.

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 13—Stock-Based Compensation - continued

Stock-Based Plans

2012 Omnibus Incentive Plan

Stock Options

On June 1, 2012, the stockholders approved the 2012 Omnibus Incentive Plan (the “2012 Plan”), providing for the issuance of up to 5,700,000 shares of common stock, including approximately 2,100,000 shares previously approved by the Company’s stockholders under our Amended and Restated 2006 Stock Incentive Plan (the “2006 Stock Plan”), less one share of common stock for every one share of common stock that was subject to an option or other award granted after December 31, 2011 under the 2006 Stock Plan, plus an additional number of shares of common stock equal to the number of shares previously granted under the 2006 Stock Plan that either terminate, expire, or are forfeited after December 31, 2011. As of September 30, 2013, there were approximately 6.1 million shares of common stock available for grant. A summary of stock option activity under the 2012 Plan during the nine months ended September 30, 2013 is as follows:

Options	Number of Stock Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life		Aggregate Intrinsic Value
Outstanding at December 31, 2012		187,375		$	2.86
Granted		914,000		$	1.89
Exercised		-		$	-
Forfeited or expired		(43,500	)	$	3.21
Outstanding at September 30, 2013		1,057,875		$	2.01		9.6	$	93,785
Exercisable at September 30, 2013		106,375		$	2.86		8.7	$	-

The fair value of each stock option is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

Three Months Ended

September 30,

Nine Months Ended

September 30,

2013

2012

2013

2012

Weighted-average volatility 86 % 83 % 86 % 84 %

Weighted-average risk-free interest rate 1.55 % 0.68 % 1.21 % 0.64 %

Weighted-average expected life in years 5.8 5.8 5.8 5.6

Dividend yield - % - % - % - %

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 13—Stock-Based Compensation - continued

Restricted Stock Awards

The Company granted 150,000 and zero RSAs during the three months ended September 30, 2013 and 2012, respectively. The Company granted 1,458,000 and zero RSAs during the nine months ended September 30, 2013 and 2012, respectively. The Company recorded stock-based compensation expense related to RSAs of approximately $198,000 and zero for the three months ended September 30, 2013 and 2012, respectively. A summary of RSA activity under the 2012 Plan during the nine months ended September 30, 2013 is as follows:

RSA's	Number of Stock Options			Weighted- Average Stock Price
Outstanding at December 31, 2012		-		$	-
Granted		1,458,000		$	1.79
Exercised		-		$	-
Forfeited or expired		(92,500	)	$	-
Outstanding at September 30, 2013		1,365,500		$	1.79
Unvested at September 30, 2013		1,365,500		$	1.79

2006 Stock Incentive Plan

On June 27, 2007, the stockholders approved the 2006 Stock Plan, providing for the issuance of up to 3,700,000 shares of common stock plus an additional number of shares of common stock equal to the number of shares previously granted under the 1998 Stock Option Plan that either terminate, expire, or lapse after the date of the Board of Directors’ approval of the 2006 Plan.

In 2008, our Board of Directors and stockholders approved an amendment to the 2006 Plan to authorize the issuance of an additional 2,000,000 shares of common stock. In November 2009, our Board of Directors approved an amendment to the 2006 Plan to authorize the issuance of an additional 2,000,000 shares of common stock. On June 4, 2010, our stockholders ratified this amendment to the 2006 Plan. In June 2011 and November 2011, our Board of Directors and stockholders approved amendments to the 2006 Plan to authorize the issuances of 4,000,000 additional shares of common stock. Pursuant to the terms of the 2006 Plan, eligible individuals could be granted incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, or stock grant awards.

A summary of stock option activity under the 2006 Stock Plans during the nine months ended September 30, 2013 is as follows:

Options	Number of Stock Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life		Aggregate Intrinsic Value
Outstanding at December 31, 2012 (1)		8,452,340		$	2.56
Granted		-		$	-
Exercised (2)		(122,685	)	$	1.00
Forfeited or expired		(849,872	)	$	4.56
Outstanding at September 30, 2013 (3)		7,479,783		$	2.38		5.9	$	3,362,457
Exercisable at September 30, 2013 (4)		5,968,883		$	1.95		5.3	$	3,362,457

(1)	Includes 135,531 outstanding options to purchase common stock at a weighted average exercise price of $3.62 per share being held by consultants.

(2)	Includes 20,000 outstanding options to purchase common stock at a weighted average exercise price of $1.00 per share being held by consultants.

(3)	Includes 115,531 options granted to purchase common stock at a weighted average exercise price of $4.08 per share being held by consultants.

(4)	Includes 71,352 exercisable options to purchase common stock at a weighted average exercise price of $3.64 per share being held by consultants.

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 13—Stock-Based Compensation - continued

The total intrinsic value of options exercised during the nine months ended September 30, 2013 and 2012 were approximately $116,000 and $412,000, respectively.

Non-Plan Options

The Board of Directors has approved and our stockholders have ratified the issuance of stock options outside of our stock incentive plans. A summary of Non-Plan option activity during the nine months ended September 30, 2013 is as follows:

Options	Number of Stock Options		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life		Aggregate Intrinsic Value
Outstanding at December 31, 2012		443,038	$	1.34
Granted		-	$	-
Exercised		-	$	-
Forfeited or expired		-	$	-
Outstanding at September 30, 2013		443,038	$	1.34		6.4	$	208,228
Exercisable at September 30, 2013		443,038	$	1.34		6.4	$	208,228

Note 14—Warrants

In March 2006, the Company issued warrants to purchase 200,000 shares of common stock at an exercise price of $3.55 per share as compensation to our then Chief Executive Officer. These warrants were still outstanding on September 30, 2013 and expire in March 2016. During March 2006, the Company issued three series (Series 1, 2 and 3) of warrants to purchase 1,000,000 shares of common stock each at exercise prices of $2.87, $4.00, and $7.00 as compensation for certain strategic initiatives, including acquiring the services of our then Chief Executive Officer. The Series 1 warrant was exercised in 2006. Of the remaining warrants 50% (1,000,000) were owned by RSI. Pursuant to the terms of the RSI Agreement the exercise price of RSI’s outstanding warrants was reduced to $2.75 per share. The warrant re-pricing resulted in a discount on the RSI Note of $263,690, to be amortized over the life of the RSI Note, (see Note 8). The Series 2 and Series 3 warrants were outstanding at December 31, 2012 and expire in March 2016. The fair value of the warrant re-pricing was determined by comparing the fair value of the modified warrant with the fair value of the unmodified warrant on the modification date and recording any excess as a discount on the note. On March 5, 2013, the Company and RSI entered into an agreement pursuant to which RSI exercised its warrants. At September 30, 2013, the RSI Warrants have been fully exercised and are of no further force or effect.

The fair value of the modified warrants was calculated using the Black-Scholes option-pricing model with the following assumptions:

Risk-free interest rate:		3.24	%
Expected term: (years)		6.0
Expected dividend yield:	—
Expected volatility:		105.7	%

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 14—Warrants - continued

In October 2006, the Company issued two series of warrants to purchase 1,000,000 shares of common stock each at exercise prices of $12.50 and $15.00 per share to MATT in connection with the issuance of common stock. On January 25, 2008, the Company entered into a Note Purchase Agreement (the “MATT Agreement”) with MATT. Pursuant to the terms of the MATT Agreement the exercise price of MATT’s outstanding warrants was reduced to $2.75 per share. The warrant re-pricing resulted in a discount on the MATT Note of $1,341,692, to be amortized over the life of the MATT Note. These warrants expire in October 2016 and were outstanding as of December 31, 2012. The fair value of the warrant re-pricing was determined by comparing the fair value of the modified warrant with the fair value of the unmodified warrant on the modification date and recording any excess as a discount on the note. No such discount was recorded as the repriced warrants value decreased. On March 5, 2013, MATT exercised warrants to purchase 2,147 shares of common stock using the amount by which the outstanding principal and accrued interest under the MATT Note exceeded the amount of the Receivable (see Note 8). MATT agreed to exercise or forfeit the MATT warrants with an aggregate exercise price of $2,000,000 over an eleven-month period beginning in March 2013. For the nine months ended September 30, 3013 400,002 warrants were forfeited. At September 30, 2013, MATT Warrants totaling 1,597,851 were outstanding.

On April 29, 2013 the Company issued warrants to the lender in conjunction with a loan and security agreement with an initial aggregate exercise value of $400,000, which increases by $100,000 with the first tranche and by $150,000 with the second and third tranche draw down of the loan (see Note 8). The warrant exercise price will be the lesser of $1.96, and the price per share of the Company common stock issued in the next equity placement of the Company’s stock to occur after April 29, 2013, excluding any conversion of the March 21, 2013 Convertible Note Payable (see Note 8). The warrants expire on February 28, 2024 and include a cashless exercise provision. The aggregate exercise value of warrant is fixed at $500,000 with the initial drawn down of the Company’s loan, the exercise price of $1.96 is considered variable, and the number of warrants is a factor of the exercise value divided by the exercise price per warrant. The Company recorded the warrant as paid in capital after evaluation of the equity classification.

The fair value of the warrants was calculated using the Black-Scholes option-pricing model with the following assumptions:

Risk-free interest rate:		1.96	%
Expected term: (years)		10.0
Expected dividend yield:	—
Expected volatility:		90.4	%

A summary of warrant activity for the nine months ended September 30, 2013 is as follows:

Warrants	Number of Warrants			Weighted- Average Exercise Price
Outstanding at December 31, 2012		4,200,000		$	2.98
Granted		255,102		$	1.96
Exercised		(1,002,147	)	$	2.75
Forfeited or expired		(400,002	)	$	2.75
Outstanding at September 30, 2013		3,052,953		$	3.00
Exercisable at September 30, 2013		3,052,953		$	3.00

MEETME, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2013 - continued

(Unaudited)

Note 15—Transactions with Affiliates

Alonso Ancira serves on our Board of Directors as a non-employee director. Mr. Ancira also serves on the Board of Directors of the Organization, is the Chairman of the Board of Directors of MATT, a principal stockholder of the Company and is the Chairman of the Board of Directors of AHMSA, which owns MATT. The Company has participated in several significant transactions with MATT, the Organization and AHMSA. See Note 8 – Long term Obligations, Note 10 – Convertible Preferred Stock, and Note 14 – Warrants. These relationships do not qualify as related parties for accounting purposes under GAAP.

The Company earned $6.0 million of Social Theater revenue for the nine months ended September 30, 2012 from MATT. The Company did not have Social Theater revenue for the nine months ended September 30, 2013 from MATT or its parent company, AHMSA. At December 31, 2012, approximately $6.0 million of our combined accounts receivable were from AHMSA and MATT.

Note 16- Significant Customers and Concentration of Credit Risk

During the nine months ended September 30, 2013 and 2012, one non-affiliate customer, an advertising aggregator, comprised approximately 30% and 24% of total revenues, respectively. For the nine months ended September 30, 2013 and 2012 an affiliate customer, a principal shareholder of the Company, MATT and its parent company, comprised zero and approximately 17%, respectively, of total revenues. The non-affiliate and affiliate customers comprised approximately 13% and 47% of total accounts receivable as of September 30, 2013 and September 30, 2012, respectively.

Note 17—Subsequent Events

On October 31, 2013, the Company entered into an Advertising Agreement with Pinsight Media+, Inc. (“Pinsight”) (the “Agreement”). The Agreement is effective from October 31, 2013 through December 31, 2014, unless earlier terminated.

Pursuant to the Agreement, Pinsight has the right and obligation to fill all of the Company’s advertising inventory on its MeetMe mobile app for iOS and Android (the “App”). The Agreement does not apply to other mobile apps or virtual currency features on the App, including without limitation, offer wall features and the Company’s Social Theater business. The Agreement contemplates the Company’s existing ad logic on the App. If the Company wishes to increase the number, type, frequency or scope of impressions on the App (“Additional Inventory”), it must first notify Pinsight and upon Pinsight’s written consent, said Additional Inventory will become subject to the Agreement.

Pinsight will pay for all ad requests that the Company delivers, whether or not Pinsight fills them. Pinsight will pay specified CPM rates depending on the type of ad; provided, however, that if more than a stated percentage of all page views on the App originate outside of the United States, then Pinsight will remit to the Company a percentage of gross revenue relating to international ad impressions in excess of such amount. The stated CPM rates for certain ads are subject to renegotiation under certain conditions; in such case, if the parties do not agree on a modified rate, then such ads will be excluded from the Agreement.

Prior to April 1, 2014, Pinsight will pay the Company’s invoices within ninety days; after such date, Pinsight will pay Company’s invoices within sixty days. Pinsight assumes all risk in regards to collection of all applicable advertiser fees with respect to all advertising inventory and may not delay payment to the Company as a result of non-collection or delay of payment by the advertisers. Pinsight will comply with the Company’s advertising editorial guidelines as in effect from time to time.

The Company may terminate the Agreement upon written notice if (i) Pinsight fails to pay any undisputed amount in a timely fashion, or (ii) in the Company’s sole discretion, Pinsight’s software development kit and those of its performance partners and the placement and running of ads on the App causes a diminution in the App user experience. Either party may terminate the Agreement (a) if the other party undergoes a change of control, (b) upon certain breaches by the other party, subject to cure periods, or (c) the other party files a petition for bankruptcy, becomes insolvent, makes an assignment for the benefit of its creditors, or a receiver is appointed for such party or its business.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Note Regarding Forward-Looking Statements

Management’s Discussion and Analysis of Financial Condition and Results of Operation is set forth below. Certain statements in this report may be considered to be “forward-looking statements” as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995. In particular, these forward-looking statements include, among others, statements about:

●

our expectations regarding user engagement patterns;

●

our expectations regarding mobile usage by our users;

●

the impact of increased mobile usage and Social Theater competition on revenues and financial results;

●

our expectations relating to advertising and the effects of advertising and mobile monetization on our revenues;

●

our plans regarding product development, international growth and personnel;

●

our liquidity and expectations regarding uses of cash;

●

our expectations regarding payments relating to cost reduction initiatives;

●

the impact of new accounting policies; and

●

our plans for capital expenditures for the remainder of the year ending December 31, 2013.

All statements other than statements of historical facts contained in this report, including statements regarding our future financial position, liquidity, business strategy, plans and objectives of management for future operations, are forward-looking statements. The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “will,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs.

Important factors that could cause actual results to differ from those in the forward-looking statements include users’ willingness to try new product offerings, the risk that unanticipated events affect the functionality of our mobile application with popular mobile operating systems, any changes in such operating systems that degrade our mobile application’s functionality and other unexpected issues which could adversely affect usage on mobile devices, the risk that the mobile advertising market will not grow, the ongoing existence of such demand and the willingness of our users to complete mobile offers or pay for virtual currency. Any forward-looking statement made by us in this report speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

You should read the following discussion in conjunction with our audited historical consolidated financial statements. Management’s Discussion and Analysis of Financial Condition and Results of Operations contain forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed elsewhere in “Risk Factors,” located at Part II, Item 1A of this report and in our Form 10-K for the year ended December 31, 2012 and in our Current Reports on Form 8-K filed with the SEC on May 1, 2013, October 1, 2013 and November 6, 2013. Additional risks that we do not presently know or that we currently believe are immaterial could materially and adversely affect any of our business, financial position, future results or prospects.

Company Overview

MeetMe is a social network for meeting new people both on the web and using its mobile applications on iPhone, Android, iPad and other tablets, including a combination of traditional social networking features (e.g. profiles, messaging, friend lists) and unique social discovery applications that facilitate interactions among users and encourage users to connect with each other. An example of such an application is the Live Feed, a location-based news feed that displays text, photo, and video posts of users geographically proximate to the viewing user. The MeetMe operating and user metrics include operating activity from the MeetMe.com and the former myYearbook.com website and mobile apps and excludes operating activity from the former Quepasa.com website and Quepasa Games.

Through the Live Feed and other features such as Locals and Match, users are able to discover relevant people around them. Once users connect through a feature, some portion of those users will take other actions with respect to particular users such as viewing their profiles and sending them messages. The platform’s health is a function of its number of active users, the number of new users joining per day, and the average revenue per user.

Trends in Our Operating Metrics

We measure site and application in terms of monthly active users (MAUs), visits and page views. We define “MAU” as a registered user of one of our platforms who has logged in and visited our websites or mobile applications within the last month of measurement. A “visit” represents a distinct user session, and a “page view” is a page that a user views during a visit. For the quarters ended September 30, 2013 and September 30, 2012, the total MeetMe MAUs were approximately 5.34 million and 3.94 million, respectively. MeetMe visits were approximately 968 million and 370 million, respectively for the quarters ended September 30, 2013 and September 30, 2012. MeetMe registered users numbered approximately 117 million and 89 million, respectively, for the quarters ended September 30, 2013 and September 30, 2012. MeetMe visits and page views exclude user visits and page views from iPhone users for the quarter ended September 30, 2012 because reliable data could not be tracked for that period.

Trends in Our User Metrics

We measure activity on our sites in terms of MAUs, daily active users (DAUs), average revenue per user (ARPU), average revenue per daily active user (ARPDAU), visits and page views. We define a mobile MAU as a user who accessed one of our sites by a mobile application or by the mobile-optimized version of our website, whether on a mobile phone or tablet such as the iPad during the month of measurement. We define a DAU as a registered user of one of our platforms who logged in and visited our websites or mobile applications within the day of measurement. We define a mobile DAU as a user who accessed our sites by one of our mobile applications or by the mobile-optimized version of our website, whether on a mobile phone or tablet such as the iPad during the day of measurement. We define ARPU as the average revenue per average monthly active user for web and mobile. We define ARPDAU as the average revenue per average daily active web or mobile user. Visits represent the number of times during the measurement period that users came to the site or mobile applications for distinct sessions. A page view is a page that a user views during a visit.

For the quarter ended September 30, 2013, MeetMe averaged 2.66 million mobile MAUs and 5.34 million total MAUs, as compared to 1.95 million mobile MAUs and 3.94 million total MAUs on average for the quarter ended September 30, 2012 and net increases of over 0.71 million and 1.40 million in mobile and total MAUs, respectively. Increases of approximately 37% for mobile and 36% for total MAUs, and international expansion and marketing. Mobile DAUs increased 112,000 to 790,000 for the quarter ended September 30, 2013, a 16% improvement, from 678,000 in the third quarter of 2012. For the quarter ended September 30, 2013, MeetMe averaged 1.14 million total DAUs, as compared to 1.11 million total DAUs on average for the quarter ended September 30, 2012, a net increase of approximately 30,000 total DAUs, or 3%.

We believe the shift of our audience from web to mobile is an important driver of our business. Our growth is largely driven by our mobile audience, which we currently monetize at lower rates than our web audience. We averaged 5.34 million MAUs on MeetMe in the third quarter 2013, flat to the second quarter of 2013. Our user base generated over 10.8 billion total page views in the third quarter of 2013, an upturn from the 10.4 billion page views in the same period of 2012. The decline in web revenue is gradually being offset by growing mobile revenues. We have successfully increased our mobile ARPDAU by 42% to $0.040 for the quarter ended September 30, 2013 from $0.028 for the quarter ended September 30, 2012. Our ability to grow our mobile audience and our mobile monetization at a faster pace than the decline in our web revenue will impact the performance of our business.

For the quarter ended September 30, 2013, MeetMe earned an average of $1.44 in ARPU on the web and $1.10 in ARPU in our mobile applications, as compared to $2.34 in web ARPU and $0.91 in mobile ARPU for the quarter ended September 30, 2012. We believe the decline in ARPU between the quarters ended September 30, 2013 from 2012 is primarily due to lower web and mobile advertising revenue brought about from the transition to mobile access and increased international users with lower initial monetization rates. For the quarter ended September 30, 2013, the Company earned an average of $0.130 in web ARPDAU and $0.040 in mobile ARPDAU, as compared to $0.142 in web ARPDAU and $0.028 in mobile ARPDAU for the quarter ended September 30, 2012.

Third Quarter 2013 Highlights :

●

Revenue for the quarter was $10.1 million, advancing 6% sequentially from the second quarter of this year.

●

Mobile revenue reached another quarterly record of $2.9 million, up 65% year-over-year and 12% sequentially from the second quarter of 2013. Mobile ad impressions served in the third quarter were 6.4 billion, up by approximately 1.5 billion sequentially from 4.9 billion in the second quarter of 2013, with third quarter growth driven largely by expansion of Native Advertising.

	●	Net loss in the quarter improved to $1.5 million or $0.04 per share, compared with a net loss of $2.6 million or $0.07 per share in the third quarter of 2012.

	●	Adjusted EBITDA was a positive $696,000, increasing sequentially for the second consecutive quarter, and up from $95,000 in the third quarter a year ago. (See the important discussion about the presentation of non-GAAP financial measures, and reconciliation to the most directly comparable GAAP financial measures, below)

	●	Cash and Cash Equivalents totaled $8.7 million at September 30, 2013, up from $8.3 million at June 30, 2013.

Factors Affecting Our Performance

●

Number of MAUs and DAUs: We believe our ability to grow web and mobile MAUs and DAUs affects our revenue and financial results by influencing the number of advertisements we are able to show, the value of those ads, and the volume of virtual currency and subscription purchases, as well as our expenses and capital expenditures.

●

User Engagement: We believe changes in user engagement patterns affect our revenue and financial performance. Specifically, the number of visits and page views each MAU or DAU generates affects the number of advertisements we are able to display and therefore the rate at which we are able to monetize our active user base. We continue to create new features and enhance existing features to drive additional engagement.

●

Platform Trends: We believe increasing use of MeetMe on mobile devices affects our revenue and financial results, as we currently display fewer ads on average to mobile users compared to users on personal computers, and we earn less revenue per ad impression as a result of the mobile advertising market being less established than the web advertising market. Increasing smart mobile device users provides opportunity for increased revenue. Mobile device users have a higher propensity to browse and engage in social media resulting in a greater share of time spent online happening on mobile devices. The majority of smart phone and tablet owners access social media from their devices through apps which are optimized for small-screen environment rather than the traditional fixed web access. The ratio of smart phone users is overtaking that of traditional phone users and a similar growth trend can be seen for the use of tablets compared to personal computers. Improving the rate at which we monetize our growing mobile traffic is a key priority, as we expect our users to continue to shift their usage from web to mobile for the foreseeable future. The acceleration in our user access to mobile impacted revenues negatively in the first nine months of 2013 and we expect the impact to gradually abate as mobile monetization continues to mature and as the mobile advertising market grows.

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Advertising Rates: Similar to many other publishers, the revenue we earn per thousand ad impressions (CPM) on the web is on a downward trend, while CPM in our mobile applications has been rising, but remains significantly lower as compared to the web. Our revenue and financial results are materially dependent on these broader industry trends, and to the extent CPM continues declining on the web and is not offset by the rising CPM on mobile, our operating results may be impacted. We expect to continue investing in new types of advertising and new placements, especially in our mobile applications. Additionally, we are prioritizing initiatives that generate revenue directly from users, including new virtual currency products and a premium subscription product, in part to reduce our dependency on advertising revenue. The Company’s mobile applications have increased our mobile native advertising unit inventory available for advertisers.

●

User Geography: The geography of our users influences our revenue and financial results because we currently monetize users in distinct geographies at varying average rates. For example, ARPU in the United States and Canada is significantly higher than in Latin America. In 2012 and 2013, we laid the foundation for future international growth by localizing the MeetMe service into a total of thirteen languages with a focus on Western Europe and Asia. We plan to continue to invest in user growth across the world, including in geographies where current per user monetization rates are relatively lower than in the United States and Canada.

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New User Sources: We believe the percentage of our new users that are acquired through inorganic paid sources has a material impact on our financial performance, specifically with regard to ARPU for web and mobile. Inorganically acquired users tend to have lower engagement rates, generate fewer visits and ad impressions and are less likely to buy virtual currency products. When paid marketing campaigns are ongoing, our overall usage and traffic increases due to the influx of inorganically acquired users, but the rate at which we monetize the average active user overall declines as a result.

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Ad Inventory Management: Our revenue trends are affected by advertisement inventory management changes affecting the number, size, or prominence of advertisements we display. In general, more prominently displayed advertising units will generate more revenue per impression. Our Social Theater campaign expenses are materially dependent on the percentage of Social Theater campaigns that run on MeetMe.com and the percentage that run on our partners’ cross-platform networks. We work to maximize the share of Social Theater campaigns that run on MeetMe.com and run campaigns on our partners’ networks only when necessary to increase their reach.

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Increased Social Theater Competition: A significant portion of the revenue generated by Social Theater is derived from advertising campaigns that run on our partners’ cross-platform networks and not on MeetMe.com. A recent increase in competitors offering similar technology solutions, and in some cases their own cross-platform distribution networks, may make it difficult to compete on price and win business. We expect this downward pressure on price to continue and impact our operating results in the future.

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Seasonality: Advertising spending is traditionally seasonal with a peak in the fourth quarter of each year. We believe that this seasonality in advertising spending affects our quarterly results, which generally reflect a growth in advertising revenue between the third and fourth quarters and a decline in advertising spending between the fourth and subsequent first and second quarters of each year.

●

Headcount: We expect to leverage and supplement our current talent pool through managed growth. We plan to hire additional software engineers, other personnel with technology expertise, and sales personnel to support mobile and international expansion.

Growth trends in web and mobile MAUs and DAUs are critical variables that affect our revenue and financial results by influencing the number of advertisements we are able to show, the value of those ads, the volume of payments transactions, as well as our expenses and capital expenditures.

Changes in user engagement patterns from web to mobile and international diversification also affect our revenue and financial performance. We believe that overall engagement as measured by the percentage of users who create content (such as status posts, messages, or photos) or generate feedback increases as our user base grows. We continue to create new apps and enhance existing apps to lift social sharing and increase monetization.

We believe our revenue trends are also affected by advertisement inventory management changes affecting the number, size, or prominence of advertisements we display and traditional seasonality. Social Theater is a revenue product for MeetMe and on third-party sites. Social Theater growth may be affected by large brand penetration, the ability to grow the advertiser base and advertiser spending budgets.

Recent Changes in our Senior Management

On September 3, 2013, Gavin Roy resigned as Chief Technology Officer of the Company. Mr. Roy has agreed to continue to assist the Company over the coming months in a non-executive capacity and will work with the Company’s Chief Executive Officer, Geoff Cook, on certain transition projects.

Also on September 3, 2013, Richard Friedman joined the Company as Chief Technology Officer. Mr. Friedman was formerly Chief Technology Officer of Stuzo, Inc., from March 4, 2013 to August 23, 2013. Mr. Friedman had served as MeetMe’s Vice President, Software Engineering, from November 10, 2011 to March 1, 2013. Mr. Friedman was appointed to that position in connection with the myYearbook merger. From December 2008 until the merger, Mr. Friedman served as the Vice President and Director of Software Engineering of myYearbook. From February 2008 to December 2008, Mr. Friedman was a founder of Ringside Networks, a social networking open source startup. From December 2004 to February 2008, Mr. Friedman held product manager roles at JBoss and its acquirer Red Hat for their respective systems management technology. From March 2003 to December 2004, Mr. Friedman served as First Vice President at Bank One and its acquirer JP Morgan Chase. From 1997 to 2004, Mr. Friedman held multiple roles, including Chief Technologist Bluestone Division, Director of Rich Media Technology and Senior Integration Architect, at Bluestone Software and its acquirer Hewlett-Packard.

Discontinued Operations from Quepasa Games

On June 30, 2012, the Company discontinued its games development and associated intellectual properties creation operations. Accordingly, games operations have been classified as discontinued operations for all periods presented. Game revenue was recognized when persuasive evidence of an arrangement existed, the sales price was fixed or determinable, collectability was reasonable assured, and the service was rendered. For the purpose of determining when the service had been provided to the player, we determined an implied obligation existed to the paying player to continue displaying the purchased virtual items within the online game of a paying player over their estimated life.

Games expenses represented the direct expenses for hosting, marketing, site fees, reporting and foreign taxes. Games product development and content expenses included salaries, benefits, and share-based compensation for our employees, utility charges, and production office costs, were charged to discontinuing operations as incurred. Game exit costs included severance costs of terminated employees and exit costs of office closure expenses and were charged to discontinuing operations as incurred.

The following table sets forth a modified version of our unaudited Consolidated Statements of Operations and Comprehensive Loss that is used in the following discussions of our results of operations:

	Three Months Ended September 30,
	2013			2012			2013 to 2012 Change ($)

Revenues	$	10,073,309		$	11,598,432		$	(1,525,123	)

Operating Costs and Expenses
Sales and marketing		1,876,240			2,656,955			(780,715	)
Product development and content		6,817,591			7,883,987			(1,066,396	)
General and administrative		1,536,939			2,001,950			(465,011	)
Depreciation and amortization		1,108,856			1,025,421			83,435
Restructuring costs		-			353,555			(353,555	)
Operating Expenses		11,339,626			13,921,868			(2,582,242	)
Loss from Operations		(1,266,317	)		(2,323,436	)		(1,057,119	)

Other Income (Expense):
Interest income		2,503			3,866			(1,363	)
Interest expense		(222,777	)		(280,852	)		(58,075	)
Other income		-			8,581			(8,581	)
Total Other Income (Expense)		(220,274	)		(268,405	)		(48,131	)

Net loss	$	(1,486,591	)	$	(2,591,841	)	$	(1,105,250	)

Results of Operations for the Three-Month Periods Ended September 30, 2013 and September 30, 2012

Revenues

Our revenues were approximately $10.1 million, for the three months ended September 30, 2013, a decrease of $1.5 million or 13% compared to $11.6 million for the same period in 2012. The net decrease in non-affiliated revenue is attributable to decreases of approximately $2.4 million in web advertising and virtual currency products, and offset by a net increase of $0.7 million mobile advertising and virtual currency product revenues.

Operating Costs and Expenses

Sales and Marketing: Sales and marketing expenses decreased approximately $781,000, or 27%, to approximately $1.9 million for the three months ended September 30, 2013 from $2.7 million for the same period in 2012. Decreased sales and marketing expenses are primarily attributable to cost reductions of $328,000 attributable to decreased sales and marketing salaries, sales commissions, related expenses and stock compensation costs for decreased sales staff, and due to decreased advertising and marketing expenses of $470,000.

Product Development and Content: Product development and content expenses decreased approximately $1.1 million, or 14%, to $6.8 million, for the three months ended September 30, 2013 from $7.9 million for the three months ended September 30, 2012. The net decrease in product development and content expense is attributable to a net reduction of $600,000 of third party content costs for cross platform Social Theater affiliate campaigns The drop for the quarter ended September 30, 2013 expenses also reflects cost reductions of approximately $359,000 associated with decreases in salary, bonuses, related expenses, and stock compensation costs for decreased workforce.

General and Administrative: General and administrative expenses decreased $465,000, or 23%, to $1.54 million for the three months ended September 30, 2013 from $2.00 million for the same period in 2012. The aggregate decrease in general and administrative costs is due to reductions of approximately $300,000 from stock-based compensation expense, and $150,000 to lower salary and bonus expense.

Stock Based Compensation

Stock based compensation expense included in the operating expense by category, decreased approximately $176,000 to $851,000 for the three months ended September 30, 2013 from $1,027,000, for the three months ended September 30, 2012. The decrease is primarily the result of reversals of unvested stock compensation for terminated employees related to the reduction in workforce that took place May 1, 2013.

	Three Months Ended September 30,				2013 to 2012 Changes ($)
	2013		2012
Sales and marketing	$	103,521	$	95,399	$	8,122
Product and content development		583,523		475,616		107,907
General and administrative		163,598		455,555		(291,957	)
Total stock based compensation	$	850,642	$	1,026,570	$	(175,928	)

Depreciation and amortization expense

Depreciation and amortization expense increased approximately $83,000 to $1.1 million for the three months ended September 30, 2013 from $1.0 million for the three months ended September 30, 2012. The increase is primarily due to the depreciation and amortization of tangible and intangible assets associated with the server and computer equipment acquisitions made in 2012 and 2013.

The following table sets forth a modified version of our unaudited Consolidated Statements of Operations and Comprehensive Loss that is used in the following discussions of our results of operations:

	Nine Months Ended September 30,
	2013			2012			2013 to 2012 Change ($)

Revenues	$	27,361,901		$	35,049,022		$	(7,687,121	)

Operating Costs and Expenses
Sales and marketing		5,405,910			6,099,594			(693,684	)
Product development and content		19,543,611			22,605,195			(3,061,584	)
General and administrative		5,759,498			6,325,796			(566,298	)
Depreciation and amortization		3,280,843			2,888,960			391,883
Restructuring costs		2,540,896			891,499			1,649,397
Loss on debt restructure		1,174,269			-			1,174,269
Operating Expenses		37,705,027			38,811,044			(1,106,017	)
Loss from Operations		(10,343,126	)		(3,762,022	)		(6,581,104	)

Other Income (Expense):
Interest income		7,856			13,758			(5,902	)
Interest expense		(578,345	)		(867,136	)		288,791
Other income		-			9,611			(9,611	)
Total Other Income (Expense)		(570,489	)		(843,767	)		273,278

Net loss from continuing operations	$	(10,913,615	)	$	(4,605,789	)	$	(6,307,826	)
Net loss from discontinued operations	$	-		$	(3,680,627	)	$	(3,680,627	)
Net loss	$	(10,913,615	)	$	(8,286,416	)	$	(2,627,199	)

Results of Operations for the Nine-Month Periods Ended September 30, 2013 and September 30, 2012

Revenues

Our revenues were approximately $27.4 million, for the nine months ended September 30, 2013, a decrease of $7.7 million or 26% compared to $35.1 million for the same period in 2012. Revenues for the nine months ended September 30, 2012 included $6 million of Social Theater revenue from MATT. The Company did not have Social Theater revenue from affiliates for the nine months ended September 30, 2013. Our revenue from non-affiliates of $27.4 million, for the nine months ended September 30, 2013, decreased approximately $1.7 million , or 6%, from the same period in 2012. The decline in revenue is also attributable to a deceleration in web advertising and web virtual currency product revenues of $4.4 million and reductions in Social Theater revenue due to timing of campaign substantially offset by an increase of $3.6 million in mobile virtual currency product and advertising revenue.

Operating Costs and Expenses

Sales and Marketing: Sales and marketing expenses decreased approximately $694,000, or 11%, to approximately $5.4 million for the nine months ended September 30, 2013 from $6.1 million in 2012. Decreased sales and marketing expenses are primarily attributable to a decrease of approximately $200,000 in salaries and a decrease in advertising and marketing expenses of $400,000.

Product Development and Content: Product development and content expenses decreased approximately $3.1 million, or 14%, to $19.5 million, for the nine months ended September 30, 2013 from $22.6 million in 2012. The net decrease in product development and content expense is attributable to a net reduction of $2.0 million of third party content costs for cross platform Social Theater affiliate campaigns . The decrease in the nine months ended September 30, 2013 expenses also reflects cost reductions of approximately $781,000 associated with (i) decreases in salary, bonuses, related expenses, and stock compensation costs for decreased domestic workforce, (ii) cost savings achieved with the closure of our former Mexico service center and related workforce reduction, (iii) migration and merger of Quepasa.com, and (iv) $300,000 in the cost of the Company’s platform language internationalization projects which were ongoing during 2012 and completed in the first quarter of 2013.

General and Administrative: General and administrative expenses decreased $566,000, or 9%, to $5.8 million for the nine months ended September 30, 2013 from $6.3 million for the same period in 2012. The aggregate decrease in general and administrative costs is due to reductions of approximately $201,000 in trade receivable write-offs attributable to improved monitoring and collection processes; $187,000 in legal settlement costs; and a net decrease of $196,000 in travel costs, professional service fees, office expenses, and administrative costs.

Stock Based Compensation

Stock based compensation expense for continuing operations, included in the operating expense by category, decreased approximately $144,000 to $2.8 million for the nine months ended September 30, 2013 from $2.9 million for the nine months ended September 30, 2012. The net decreased is primarily the result of approximately $564,000 of accelerated stock compensation attributable to the immediate vesting of stock options for the Company’s former Chief Executive Officer and Chief Financial Officer at March 31, 2013 offset substantially by the reversals of unvested stock compensation for terminated employees related to the reduction in workforce that took place on May 1, 2013. Stock based compensation expense for discontinued operations, included in the loss from discontinued operations category, was approximately $152,000 for the nine months ended September 30, 2012 and zero for the same period in 2013 and the decreased expense is attributable to employees terminated in 2012. Stock based compensation expense for continuing operations represented 7% of operating expenses for the nine months ended September 30, 2013, and 2012, respectively. As of September 30, 2013, there was approximately $3.7 million and $2.1 million of unrecognized compensation cost related to stock options and unvested restricted stock awards, respectively, which is expected to be recognized over a period of approximately two to three years.

	Nine Months Ended September 30,				2013 to 2012 Changes ($)
	2013		2012
Sales and marketing	$	266,663	$	256,662	$	10,001
Product and content development		1,175,680		1,426,332		(250,652	)
General and administrative		1,319,223		1,222,161		97,062
Total stock based compensation for continuing operations		2,761,566		2,905,155		(143,589	)
Total stock based compensation for discontinued operations		-		151,506		(151,506	)
Total stock based compensation	$	2,761,566	$	3,056,661	$	(295,095	)

Depreciation and amortization expense

Depreciation and amortization expense increased approximately $392,000 to $3.3 million for the nine months ended September 30, 2013 from $2.9 in the nine months ended September 30, 2012. The increase is due to the depreciation and amortization of tangible and intangible assets associated with the server and computer equipment acquisitions made in 2012 and 2013.

Restructuring Costs

For the three and nine months ended September 30, 2013 and 2012, restructuring costs were approximately $0 and $2.5 million and $354,000 and $891,000, respectively, including the accrual of the exit cost of non-cancellable leases, employee exit and relocation costs, excluding the impact of stock based compensation expense reversals associated with employee terminations resulting from the restructure. The Company expects to pay approximately $1.8 million of the accrued restructuring expenses in severance and related employee exit costs to its former Chief Executive Officer and Chief Financial Officer during 2013.

Discontinued Operations- Quepasa Games

	Three Months Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012
Games Revenues	$	-	$	-	$	-	$	840,190
Games expenses		-		-		-		1,032,366
Product development and content		-		-		-		552,563
Depreciation and amortization		-		-		-		16,102
Exit costs		-		-		-		431,418
Loss on disposable of assets		-		-		-		48,084
Stock-based compensation		-		-		-		151,508
Loss on impairment of goodwill		-		-		-		2,288,776
Total		-		-		-		4,520,817
Loss from discontinued operations attributable to Quepasa Games	$	-	$	-	$	-	$	(3,680,627	)

There were no revenues or related expenses from discontinued games operations for the three and nine months ended September 30, 2013. The games revenues and related games expenses for 2012 represented operations for less than six full months. The Wonderful City Rio and Amazon Alive games were launched in April of 2011 and May 2012, respectively. Games operations were discontinued on June 30, 2012.

Liquidity and Capital Resources

	Nine Months Ended September 30,
	2013			2012
Net cash provided by (used in) operating activities	$	712,978		$	(656,209	)
Net cash used in investing activities		(16,946	)		(573,010	)
Net cash provided by (used in) financing activities		2,982,982			(1,561,992	)
	$	3,679,014		$	(2,791,211	)

Net cash provided by operations was approximately $713,000 for the nine months ended September 30, 2013 compared to cash used by operations of $656,000 for the same period in 2012. For the nine months ended September 30, 2013, net cash provided by continuing operations consisted primarily of a net loss from continuing operations of approximately $10.9 million offset by non-cash expenses of approximately $3.3 million from depreciation and amortization expense, $2.8 million related to stock based compensation, $1.1 million of loss on debt restructure, and $80,000 in amortization of discounts on notes payable and debt issuance costs offset by a $90,000 recovery on bad debt allowances. Additionally, changes in working capital increased the net cash provided by continuing operations. These changes included decreases in accounts receivable of approximately $2.4 million resulting from collections, $650,000 in prepaid expenses and other current assets, and increase in accounts payable and accrued expenses of $958,000, and $492,000 in deferred revenues.

For the nine months ended September 30, 2012, net cash provided by continuing operations consisted primarily of a net loss of approximately $4.6 million, offset by non-cash expenses of $2.9 million of depreciation and amortization expenses and $2.9 million related to stock based compensation, $145,000 in amortization of discounts on notes payable and debt issuance costs, and $216,000 net write off of accounts receivable and allowance adjustments. Additionally, changes in working capital increased the net cash provided by continuing operations. These changes included decreases of approximately $275,000 in restricted cash and $182,000 in prepaid expenses, and other current assets and other assets, increases of $2.0 million in accounts payable and accrued expenses and deferred revenues of $156,000 offset by an increase of $4.4 million in accounts receivable. Net cash used in discontinued operations of Quepasa Games of approximately $1.1 million consisted of a net loss from discontinued operations of $3.7 million offset by noncash expenses of $2.3 million loss on impairment of goodwill impairment, of $152,000 related to stock based compensation for the vesting of stock options, of $48,000 loss on disposal of property and equipment, and of $16,000 of depreciation and amortization. Additionally, changes in working capital from discontinued operations of $34,000 decreased the net cash used for discontinued operations.

Net cash used in investing activities for the nine months ended September 30, 2013 of approximately $17,000, was due to capital expenditures of $129,000 for computer equipment to increase capacity and improve performance offset by $112,000 of loan receivable payments received from BRC. Net cash used in investing activities in the nine months ended September 30, 2012 of approximately $573,000 was attributable to payments of $492,000 primarily for computer servers to provide redundant backup for content and increase capacity and of $125,000 for the purchase of a trademark, offset by $44,000 of loan receivable payments received from BRC. Net cash used in investing activities in the nine months ended September 30, 2013 and 2012 exclude approximately $499,000 and $1.8 million, respectively, of computer equipment purchased using capital leases.

Net cash provided by financing activities in the nine months ended September 30, 2013 of approximately $3.0 million was due to $5.0 million drawn on the growth capital loan, offset by $1.6 million of debt payments, and $566,000 of capital lease payments offset by $123,000 of proceeds from the exercise of stock options. Net cash provided by financing activities in the nine months ended September 30, 2013 excludes the $6 million subordinate note payable with accrued interest and accounts receivable offset and $2.8 million of warrant exercises and cancellation of subordinated note payable with accrued interest that were non-cash transactions. Net cash used in financing activities in the nine months ended September 30, 2012 of approximately $1.6 million was due to $1.9 million of debt payments, and a $100,000 preferred stock dividend payment offset by $630,000 proceeds from the exercise of stock options.

	September 30,			December 31,
	2013			2012
Cash and cash equivalents	$	8,682,241		$	5,022,007
Total assets	$	96,340,010		$	104,434,667
Percentage of total assets		9	%		5	%

Our cash balances are kept liquid to support our growing infrastructure needs for operational expansion. The majority of our cash is concentrated in two large financial institutions, Comerica and JP Morgan Chase.

As of September 30, 2013, the Company had positive working capital of approximately $5.0 million. The reduction in the Company’s working capital is primarily attributable to the offset of $6 million in accounts receivable and the cancellation of subordinate note payable with accrued interest from MATT. As of the date of November 6, 2013, the Company had a cash balance of approximately $7.7 million.

The Company may borrow up to $6 million of debt from financial institutions and under capital leases through its Loan and Security Agreement, provided that the Company has unrestricted cash and accounts receivable greater than 200% of its outstanding debt under the Debt Agreement . As of the date of November 6, 2013, the Company owed approximately $7.2 million on its loans payable of which $613,000 is due through September 2014, and $4.8 million through April 2016.

During the nine months ended September 30, 2013, the Company entered into capital leases with an approximate aggregate original principal amount of $449,000. Together with capital leases that were previously entered into by the Company, as of November 6, 2013, the Company had a $1.8 million in principal amount of capital lease indebtedness, of which approximately $613,000 is due through September 30, 2014.

On May 1, 2012, the Company announced a cost reduction initiative including a workforce reduction of approximately 15%, in conjunction with our focus on mobile programming. Further cost reductions were achieved by closing satellite offices and consolidating real estate facilities. The Company incurred approximately $531,000 of cash expenditures related to employee severances and employee related costs during the second quarter of 2013. The Company expects to incur approximately $72,000 of cash expenditures related to employee severances, employee related costs, and exit costs for non-cancellable leases during the third quarter of 2013. The Company also expects to pay approximately $1.8 million in severances and related employee costs to its former Chief Executive Officer and Chief Financial Officer during 2013.

The Company believes that, with its current available cash, anticipated revenues and collections on its accounts receivables, and its access to capital through various financing options, it will have sufficient funds to meet its anticipated cash needs for the next 12 months.

We have budgeted capital expenditures of $750,000 for the remainder of 2013, funded primarily through capital leases, which will support our growth of domestic and international business through increased capacity, performance improvement, and expanded content.

Contractual Obligations

Our principal commitments consist of obligations for debt, capital and operating leases for equipment and office and data center facilities. There were no material changes in our commitments under contractual obligations for the quarter ending September 30, 2013 to those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

Non-GAAP – Financial Measures

The following discussion and analysis includes both financial measures in accordance with GAAP, as well as a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP financial measures should be viewed as supplemental to, and should not be considered as alternatives to net income, operating income, and cash flow from operating activities, liquidity or any other financial measures. They may not be indicative of the historical operating results of the Company nor is it intended to be predictive of potential future results. Investors should not consider non-GAAP financial measures in isolation or as substitutes for performance measures calculated in accordance with GAAP.

We believe that both management and shareholders benefit from referring to the following non-GAAP financial measure in planning, forecasting and analyzing future periods. Our management uses this non-GAAP financial measure in evaluating its financial and operational decision making and as a means to evaluate period-to-period comparison.

The Company defines Adjusted EBITDA as earnings (or loss) from continuing operations before interest expense, income taxes, depreciation and amortization, amortization of stock-based compensation, nonrecurring acquisition, restructuring or other expenses and goodwill impairment charges. The Company excludes stock based compensation because it is non-cash in nature. Our management believes Adjusted EBITDA is an important measure of our operating performance because it allows management, investors and analysts to evaluate and assess our operating results from period to period after removing the impact of acquisition related costs, and other items of a non-operational nature that affect comparability. Our management recognizes that Adjusted EBITDA has inherent limitations because of the excluded items.

We have included a reconciliation of our non-GAAP financial measure to the most comparable financial measure calculated in accordance with GAAP. We believe that providing the non-GAAP financial measure, together with the reconciliation to GAAP, helps investors make comparisons between the Company and other companies. In making any comparisons to other companies, investors need to be aware that companies use different non-GAAP measure to evaluate their financial performance. Investors should pay close attention to the specific definition being used and to the reconciliation between such measure and the corresponding GAAP measure provided by each company under applicable SEC rules. The following table presents a reconciliation of Adjusted EBITDA to Net Income (loss) from continuing operations allocable to common shareholders, a GAAP financial measure:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012

Net Loss from Continuing Operations Allocable to Common Shareholders	$	(1,486,591	)	$	(2,591,841	)	$	(10,913,615	)	$	(4,605,789	)
Interest expense		222,777			280,852			578,345			867,136
Depreciation and amortization		1,108,856			1,025,421			3,280,843			2,888,960
Stock based compensation expense		850,642			1,026,570			2,761,566			2,905,155
Restructuring costs		-			353,555			2,540,896			891,499
Loss on debt restructure		-			-			1,174,269			-
Adjusted EBITDA (loss)	$	695,684		$	94,557		$	(577,696	)	$	2,946,961

Management uses mobile bookings to evaluate the results of our operations, generate future operating plans and assess the performances of our mobile virtual currency products and subscriptions. The Company defines mobile bookings as the total amount of revenue from the sale of our mobile virtual currency products that would have been recognized in a period if we recognized all revenue immediately at the time of sale. We record the sale of Credits and mobile subscriptions as deferred revenue. Credits are recognized when spent by the user. For the MeetMe+ subscription product, revenue is allocated between the elements of the subscriptions, Credits and services, using the relative sales value method. The service revenue element of the subscription is recognized over the respective life of the subscription and the credit revenue is recognized as revenue when used. The following table presents a reconciliation of mobile bookings, a non-GAAP financial measure to Revenue, a GAAP financial measure:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2013		2012		2013		2012

Revenue from purchased mobile virtual currency products	$	975,295	$	605,566	$	2,734,480	$	1,288,249
Change in deferred revenue		148,528		66,916		463,041		158,621
Mobile bookings	$	1,123,823	$	672,482	$	3,197,521	$	1,446,870

Critical Accounting Policies, Judgments and Estimates

Our discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States. Applying these principles requires our judgment in determining the appropriateness of acceptable accounting principles and methods of application in diverse and complex economic activities. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of revenues, expenses, assets and liabilities, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and other assumptions that we believe are reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

An accounting policy is considered to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimate that are reasonably likely to occur, could materially impact the consolidated financial statements. We believe that the following critical accounting policies reflect the more significant estimates and assumptions used in the preparation of the unaudited consolidated financial statements.

Management has discussed the development and selection of these critical accounting estimates with the Audit Committee of our Board. In addition, there are other items within our unaudited consolidated financial statements that require estimation, but are not deemed critical as defined above. Changes in estimates used in these and other items could have a material impact on our unaudited consolidated financial statements.

Accounts Receivable Allowances

We maintain an allowance for potential credit losses and for potential discounts based on historical experience and other information available to management. Discounts historically represent less than 1% of the related revenues. The fees associated with display advertising are often based on “impressions,” which are created when the ad is viewed. The amount of impressions often differs between tracking systems, resulting in discounts on some payments. We have hundreds of customers that advertise on thousands of publishers, and it is not possible for all of the parties to agree to designate a single standardized system for measuring impressions. Differences between ad serving platforms with respect to impressions is primarily due to lag time between serving of ads and other technical differences. For example: In the publisher’s platform an impression might be counted as soon as the web page opens; however, if the user were to close his or her web browser window as soon as the page is rendered, that impression data might not be counted by the advertisers tracking system, nor would the advertiser consider it a valid impression. The discounts would be determined by taking the difference in impressions between the two tracking systems and applying the appropriate CPM (cost per thousand) that the impressions were being served, so if we agreed to a CPM of $1.00 with an advertiser, and we reported 100,000 impressions, and the advertiser had 95,000 impressions, the discount would be calculated as follows – 5,000 impressions divided by 1,000 multiplied by $1.00 to come up with a discount of $5.00.

Concentration of Credit Risk

Our advertising revenue is a combination of two components: remnant advertising sales and Social Theater campaigns. Social Theater campaigns may produce individually significant revenue based upon the timing of the delivery of the campaign. The Company integrates sales with aggregators for remnant Internet advertising that represent thousands of different clients. There are many of these aggregators that could provide similar sources of advertising revenue. Our business is not dependent on any one or a few major customers; however our advertising revenue composition may result in significant customer concentrations due to the timing of large Social Theater campaigns and advertising aggregators.

Contingencies

We accrue for contingent obligations, including legal costs and restructuring costs, when the obligation is probable and the amount can be reasonably estimated. As facts concerning contingencies become known we reassess our position and make appropriate adjustments to the consolidated financial statements. Estimates that are particularly sensitive to future changes include those related to tax, legal, and other regulatory matters that are subject to change as events evolve and additional information becomes available.

Income Taxes

We use the asset and liability method to account for income taxes. Under this method, deferred income taxes are determined based on the differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements which will result in taxable or deductible amounts in future years and are measured using the currently enacted tax rates and laws. A valuation allowance is provided to reduce net deferred tax assets to the amount that, based on available evidence, is more likely than not to be realized.

Dividends

We have never declared or paid cash dividends on our common stock. We currently intend to retain any future earnings to finance the operation and expansion of our business, and we do not expect to declare or pay any dividends in the foreseeable future on our common stock.

Stock-Based Compensation

We follow the fair value recognition provisions of ASC 718, “ Compensation – Stock Compensation. ” The fair values of share-based payments are estimated on the date of grant using the Black-Scholes option pricing model, based on weighted average assumptions. Expected volatility is based on historical volatility of our common stock. We have elected to use the simplified method described in the Securities and Exchange Commission Staff Accounting Bulletin Topic 14C to estimate the expected term of employee stock options. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant. Compensation expense is recognized on a straight-line basis over the requisite service period of the award.

The assumptions used in calculating the fair value of stock-based awards represent our best estimates, but these estimates involve inherent uncertainties and the application of management judgment. As a result, if factors change and we use different assumptions, our stock-based compensation expense could be materially different in the future.

For a complete discussion of our critical accounting policies, judgments and estimates, see the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2012 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 14, 2013. There have not been any material changes in our critical accounting estimates or accounting policies since December 31, 2012.

Accounting Pronouncements

During the quarter ended September 30, 2013, there were no new accounting pronouncements or updates to recently issued accounting pronouncements disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012, that materially affect the Company’s present or future results of operations, overall financial condition, liquidity or disclosures.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

There were no material changes in market risk during the three months ended September 30, 2013.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures.

With the participation of our Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this report. Based upon such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are effective as of the end of the period covered by this report.

Changes in Internal Controls Over Financial Reporting

There was no change in our internal control over financial reporting that occurred during the fiscal quarter ended September 30, 2013, noted during the evaluation of controls as of the end of the period covered by this report, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The Company’s management, including its Principal Executive Officer and its Principal Financial Officer, do not expect that the Company’s disclosure controls will prevent or detect all errors and all fraud. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with associated policies or procedures. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we are party to certain legal proceedings that arise in the ordinary course and are incidental to our business. There are currently no such pending proceedings to which we are a party that our management believes will have a material adverse effect on the Company’s consolidated financial position or results of operations. There were no material changes in litigation during the nine months ended September 30, 2013.

Item 1A. Risk Factors

There have been no material changes to the risk factors disclosed in the Part I, Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2012, as updated by the risks and information set forth on our Current Reports on Form 8-K filed with the Securities and Exchange Commission on May 1, 2013, October 1, 2013 and November 6, 2013, in evaluating our business, financial position, future results and prospects. The risks described in these filings are not the only risks we face.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On September 17, 2013, the Company exercised its right to convert a $600,000 note it had issued to MeetMoi LLC on March 21, 2013 (the “MeetMoi Note”) in settlement of a contract and trademark dispute. The Company subsequently issued MeetMoi LLC 306,122 shares of its common stock at $1.96 per share (the “Securities”). The Securities were offered and sold in a private placement transaction made in reliance upon exemptions from registration pursuant to Section 4(2) under the Securities Act of 1933, as amended (the "Securities Act") and/or Rule 506 promulgated under the Securities Act. MeetMoi LLC is an accredited investor as defined in Rule 501 of Regulation D promulgated under the Securities Act.

Item 3. Defaults upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits – TO BE UPDATED FOR NEW AGREEMENTS

(a) Exhibit Index.

Exhibit Index

		Incorporated by Reference			Filed or Furnished
Exhibit No.	Exhibit Description	Form	Date	Number	Herewith
10.1	Roy Employment Agreement Amendment No. 1*				Filed
10.2	Friedman Employment Agreement *				Filed
10.3#	Media Publisher Agreement with Beanstock Media Inc.				Filed
31.1	Certification of Principal Executive Officer (Section 302)				Furnished**
31.2	Certification of Principal Financial Officer (Section 302)				Furnished**
32.1	Certification of Principal Executive Officer (Section 906)				Furnished**
32.2	Certification of Principal Financial Officer (Section 906)				Furnished**
101.INS	XBRL Instance Document				***
101.SCH	XBRL Taxonomy Extension Schema Document				***
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document				***
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document				***
101.LAB	XBRL Taxonomy Extension Label Linkbase Document				***
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document				***

* Management contract or compensatory plan or arrangement.

** This exhibit is being furnished rather than filed and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.

*** Attached as Exhibit 101 to this report are the Company’s financial statements for the quarter ended September 30, 2013 formatted in XBRL (eXtensible Business Reporting Language). The XBRL-related information in Exhibit 101 in this report shall not be deemed “filed” or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, and is not filed for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of those sections.

# Confidential treatment requested under 17 C.P.R. §§200.80(b)(4) and 240.24b-2. The confidential portions of this exhibit have been omitted and are marked accordingly. The confidential portions have been filed separately with the Securities and Exchange Commission.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		MeetMe, Inc.


November 8, 2013		/s/ Geoffrey Cook
		Geoffrey Cook
		Chief Executive Officer (Principal Executive Officer)


November 8, 2013		/s/ David Clark
		David Clark Chief Financial Officer (Principal Financial Officer)

Exhibit 10.1

August 30, 2013

Gavin Roy

4465 Blue Ridge Drive

Doylestown, PA 18902

Re: Revised Terms of Employment

Dear Gavin:

This letter reflects certain changes to your terms of employment and therefore constitutes an amendment to your Employment Agreement dated as of July 14, 2011 and it supersedes our letter agreement of August 20, 2013.

You have agreed to remain an employee of the company and assist us to transition the role of Chief Technology Officer. Accordingly, staring on September 3, 2013 (or whichever date our new Chief Technology Officer begins his employment), you will no longer be Chief Technology Officer and instead will report directly to me (without a title) and work primarily on the Transition Projects identified on Exhibit A hereto. S ubsequent to September 3, 2013 (or whichever other date you are no longer Chief Technology Officer) and while you remain an employee of the Company, you will retain ownership of Inventions (as defined in your Confidential Information and Invention Assignment Agreement) that you conceive independently and that are not used in or compete with the business of MeetMe; said Inventions shall constitute Prior Inventions (as defined in said agreement). You will continue to receive your current base salary and benefits but will not accrue or otherwise be eligible for bonus awards.

We anticipate the Transition Projects will take approximately six months to complete; provided, however, that subject to the terms of this letter, you will remain an employee for a minimum of three months while we complete the Transition Projects. Upon the earlier of (i) successful completion of the Transition Projects (which will remain subject to my sole discretion) and (ii) the six month anniversary of the date hereof (provided you remain an employee of the company on either such date), we will offer you a Separation and Release Agreement and if you sign it we will pay you severance equal to six months of your base salary (paid over six months through payroll). During the six months following your separation while we continue to pay you severance, (a) you will continue to receive (or we will otherwise reimburse you for) healthcare benefits for so long as you do not obtain other employment, and (b) your stock options and RSAs will continue to vest as if you were an employee; provided, however, that as a condition of both such benefits, you will (x) remain available and consult as requested for up to ten hours per week without additional compensation, and (y) continue to comply with your Confidential Information and Invention Assignment Agreement. This arrangement is in lieu of any other payment under your Employment Agreement.

You will work remotely during this transition time and come to the New Hope office only as necessary. We may ask you to work on matters other than the Transition Projects and the company may update Exhibit A (to add, subtract, or modify) from time to time as needed during the 45-day period following the date hereof. If at any time I am not satisfied with your performance, we retain the right to terminate your employment upon notice. In other words, this is not a guarantee of employment through the completion of the Transition Projects.

If this is acceptable to you, please sign below where indicated a return the signed copy to me either electronically or in the original prior to the close of business on August 30, 2013.

Sincerely yours,

/s/ Geoff Cook

Geoff Cook

Chief Executive Officer

Intending to be legally bound:

/s/ Gavin Roy

Gavin Roy

Exhibit 10.2

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (the “ Agreement ”) is entered into, by and between MeetMe, Inc., a Delaware corporation (the “ Company ”), and Richard Friedman (“ Executive ”) as of August 19, 2013.

WHEREAS, the parties desire to enter into this Agreement to reflect Executive’s position and role in the Company’s business and to provide for Executive’s employment by the Company, upon the terms and conditions set forth herein.

WHEREAS, this Agreement shall become effective on Executive’s first day of employment with the Company (the “ Effective Date ”) on September 3, 2013 (as the parties may mutually agree).

WHEREAS, Executive has agreed to certain confidentiality, non-competition and non-solicitation covenants contained hereunder, in consideration of the benefits provided to Executive under this Agreement.

WHEREAS, certain capitalized terms shall have the meanings given those terms in Section 3 of this Agreement.

NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows:

1. Employment . The Company hereby agrees to employ Executive, and Executive hereby accepts such employment and agrees to perform Executive’s duties and responsibilities, in accordance with the terms, conditions and provisions hereinafter set forth.

1.1 Employment Term . This Agreement shall be effective as of the Effective Date, and shall continue until first anniversary of the Effective Date, unless the Agreement is terminated sooner in accordance with Section 2 below. In addition, the term of the Agreement shall automatically renew for periods of one year unless the Company gives written notice to Executive, at least 60 days prior to the end of the initial term or at least 60 days prior to the end of any one-year renewal period, that the Agreement shall be terminated. The period commencing on the Effective Date and ending on the date on which the term of Executive’s employment under the Agreement shall terminate is hereinafter referred to as the “Employment Term.” The Company’s termination of this Agreement upon the first anniversary of the Effective Date or at the end of any one-year renewal period shall be considered an involuntary termination of Executive’s employment under this Agreement if (i) Executive is willing and able to continue performing services under terms similar to those in this Agreement, (ii) the Company does not offer Executive continued employment on terms substantially similar to those in this Agreement, and (iii) Executive’s employment terminates other than for Cause (as defined in Section 3), death, Disability (as defined in Section 3) or resignation by Executive without Good Reason (as defined in Section 3) at the date of such termination of the Agreement.

1.2 Duties and Responsibilities; Principal Place of Employment . During the Employment Term, Executive shall report to the Chief Executive Officer of the Company (the “ CEO ”) and shall serve as the Chief Technology Officer of the Company, or in such other positions as the CEO or the Board of Directors of the Company (the “ Board ”) determines. Executive’s principal place of employment under this Agreement will be the Company’s headquarters in New Hope, PA; provided that Executive may be required to travel for business in accordance with his duties and responsibilities under this Agreement.

1.3 Extent of Service . During the Employment Term, Executive agrees to use Executive’s full and best efforts to carry out Executive’s duties and responsibilities as set forth in Section 1.2 hereof with the highest degree of loyalty and the highest standards of care under applicable law and, consistent with the other provisions of this Agreement, Executive agrees to devote substantially all of Executive’s business time, attention and energy thereto. The foregoing shall not be construed as preventing Executive from making investments in other businesses or enterprises, provided that Executive agrees not to become engaged in any other business activity which, in the reasonable judgment of the CEO, is likely to interfere with Executive’s ability to discharge Executive’s duties and responsibilities to the Company or which conflict with Executive’s obligations pursuant to the Section 5 hereof. Executive will not serve on the board of directors of an entity unrelated to the Company (other than non-profit charitable organizations) without the consent of the CEO and consistent with the Company’s written code of business conduct and ethics, including the MeetMe, Inc. Code of Conduct and Ethics.

1.4 Base Salary . During the Employment Term, for all the services rendered by Executive hereunder, the Company shall pay Executive a base salary (“ Base Salary ”), at the annual rate of $300,000, payable in installments at such times as the Company customarily pays its other employees. Executive’s Base Salary shall be reviewed periodically for appropriate adjustments, if any, by the CEO or the Compensation Committee of the Board (the “ Compensation Committee ”) pursuant to the Company’s normal performance review policies for senior level executives. Executive’s Base Salary also may be decreased as a proportionate part of an overall Company reduction of compensation.

1.5 Retirement, Welfare and Other Benefit Plans and Programs . During the Employment Term, Executive shall be entitled to participate in the employee retirement and welfare benefit plans and programs made available to the Company’s senior level executives as a group, as such retirement and welfare plans may be in effect from time to time and subject to the eligibility requirements of such plans. Currently, the Company sponsors a 401(k) retirement plan and provides medical, dental, vision and life insurance to its senior level executives. During the Employment Term, Executive shall be entitled to no less than 15 days of vacation and sick leave in accordance with the Company’s vacation, holiday and other pay for time not worked policies. Nothing in this Agreement or otherwise shall prevent the Company from amending or terminating any retirement, welfare or other employee benefit plans, programs, policies or perquisites from time to time as the Company deems appropriate.

1.6 Reimbursement of Expenses . During the Employment Term, Executive shall be provided with reimbursement of reasonable expenses related to Executive’s employment by the Company on a basis no less favorable than that which may be authorized from time to time for the Company’s senior level executives as a group.

1.7 Incentive Compensation . During the Employment Term, Executive shall be entitled to participate in all short-term and long-term incentive programs established by the Company, at such levels as the CEO or Compensation Committee determines. Executive shall be eligible for annual incentive compensation with a target amount equal to 50% of his Base Salary. The actual amount of such annual incentive compensation shall be determined in accordance with the applicable plans based on achievement of individual and Company performance objectives established in advance by the CEO or Compensation Committee. No minimum incentive is guaranteed.

1.8 Equity Compensation; Listing of Common Stock . As additional consideration for the terms and conditions of this Agreement, effective on the Effective Date, Executive will receive a stock option to purchase 250,000 shares of Company common stock, subject to the terms and conditions of the Company’s equity compensation plan and Executive’s execution of a stock option grant agreement (the “ Option ”). The exercise price of the Option will be the closing price of the Company’s common stock on the Effective Date. The Option will vest as to one-third of the shares subject to the Option on the first anniversary of the grant date and the remaining two-thirds of the shares subject to the Option will vest in substantially equal installments on a monthly basis over the following two years, subject to Executive’s continued employment on the applicable vesting date. Additionally, effective on the Effective Date, Executive will receive a restricted stock award of 150,000 shares of Company common stock, subject to the terms and conditions of the Company’s equity compensation plan and Employee’s execution of a restricted stock award grant agreement (the “ Restricted Stock Award ”). The Restricted Stock Award will vest in full on the first anniversary of the grant date, subject to Executive’s continued employment on the applicable vesting date. The Company shall cause its common stock to continue to be listed for trading on a national securities exchange during the Employment Term.

2. Termination . Executive’s employment shall terminate upon the occurrence of any of the following events:

2.1 Termination without Cause or Resignation for Good Reason . The Company may terminate Executive’s employment with the Company at any time without Cause, in which case the Employment Term shall be deemed to have ended, effective upon not less than 30 days’ prior written notice to Executive pursuant to Section 4 (or upon another mutually agreed upon date). Additionally, Executive may resign from his employment with the Company for Good Reason, in which case the Employment Term shall be deemed to have ended, with such resignation to become effective no later than the day immediately following the 90th day following the initial occurrence of the event constituting Good Reason. For the avoidance of doubt, a failure by the Company to renew this Agreement (for a reason other than Cause, death or Disability or Executive’s resignation without Good Reason) shall be treated as termination of Executive’s employment under this Section 2.1.

2.2 Benefits Payable upon Termination without Cause or Resignation for Good Reason .

(a) In the event of a termination of Executive’s employment as described in Section 2.1 during the Employment Term (including, termination as a result of the Company’s decision not to renew this Agreement for a reason other than Cause, death or Disability or Executive’s resignation without Good Reason), if Executive executes and does not revoke a Release (as defined in Section 3), then for the 12 month period following the Termination Date (as defined in Section 3), Executive shall receive an amount equal to Executive’s periodic Base Salary payments (at the rate in effect immediately before the Termination Date), which shall be paid in periodic installments in accordance with the Company’s payroll practices. Subject to Executive’s delivery and non-revocation of an effective Release, payments will begin on the first regularly scheduled payroll date that occurs after the 60th day after the Termination Date, and the first payment will include amounts not yet paid during the 60 day period.

(b) In addition to the foregoing, Executive shall receive any other amounts earned, accrued or owing but not yet paid under Section 1 above and any other benefits in accordance with the terms of any applicable plans and programs of the Company; provided that Executive shall not be entitled to receive severance benefits under any Company severance plan.

(c) Notwithstanding the foregoing, if Executive is a “specified employee” of a publicly held corporation on the Termination Date, the postponement provisions of Section 409A of the Code, as described in Section 20 below, shall apply, if applicable.

2.3 Retirement or Other Voluntary Termination . Executive may voluntarily terminate employment for any reason, including voluntary retirement, effective upon 30 days’ prior written notice of termination in accordance with Section 4. In such event, after the effective date of such termination, no further payments shall be due under this Agreement. However, Executive shall receive any amounts earned, accrued or owing but not yet paid under Section 1 above through the Termination Date and shall be entitled to any benefits due in accordance with the terms of any applicable benefit plans and programs of the Company. Notwithstanding the foregoing, this Section 2.3 shall not apply if Executive terminates his employment for Good Reason (in which case Section 2.2 shall apply).

2.4 Disability . The Company may terminate Executive’s employment if Executive incurs a Disability upon written notice of termination in accordance with Section 4. Executive agrees, in the event of a dispute relating to Executive’s Disability, to submit to a physical examination by a licensed physician selected by the Company. If Executive’s employment terminates on account of Disability, no further payments shall be due under this Agreement. However, Executive shall be entitled to (i) any benefits accrued or earned under the terms of any applicable benefit plans and programs of the Company, (ii) any amounts earned, accrued or owing but not yet paid under Section 1 above through the Termination Date and (iii) a pro rated bonus for the year in which Executive’s Disability occurs, which bonus shall be calculated and paid in the same manner as set forth in Section 2.2(a)(ii) above.

2.5 Death . If Executive dies while employed by the Company, the Company shall pay to Executive’s executor, legal representative, administrator or designated beneficiary, as applicable, (i) any amounts earned, accrued or owing but not yet paid under Section 1 above through the Termination Date, (ii) any benefits accrued or earned under the Company’s benefit plans and programs according to the terms of such plans, and (iii) a pro rated bonus for the year in which Executive’s death occurs, which bonus shall be calculated and paid in the same manner as set forth in Section 2.2(a)(ii) above. Otherwise, the Company shall have no further liability or obligation under this Agreement to Executive’s executors, legal representatives, administrators, heirs or assigns.

2.6 Cause . The Company or the CEO may terminate Executive’s employment at any time for Cause upon written notice or termination to Executive in accordance with Section 4, in which event all payments under this Agreement shall cease, except for Base Salary to the extent already accrued. Executive shall be entitled to any benefits accrued or earned before Executive’s termination in accordance with the terms of any applicable benefit plans and programs of the Company; provided that Executive shall not be entitled to receive any unpaid short-term or long-term cash incentive payments and Executive shall forfeit any outstanding unvested equity grants in accordance with the terms of the applicable grant agreements.

3. Definitions . For purposes of this Agreement, the following terms shall have the meanings specified in this Section 3:

(a) “ Cause ” shall mean any of the following grounds for termination of

Executive’s employment:

(i) Executive’s commission of a felony (excluding all vehicular and traffic offenses);

(ii) Executive neglects, refuses, or fails to perform Executive’s material duties to the Company (other than a failure resulting from Executive’s incapacity due to physical or mental illness);

(iii) Executive commits an act of dishonesty or breach of trust or otherwise engages in misconduct in the performance of Executive’s duties;

(iv) Executive engages in public conduct that is harmful to the reputation of the Company;

(v) Executive breaches any written non-solicitation, non-competition, nondisclosure or invention assignment agreement, or any other material agreement in effect with the Company, including without limitation this Agreement and the Restrictive Covenants Agreement (as defined in Section 5 of this Agreement); or

(vi) Executive breaches the Company’s written code of business conduct and ethics, including the MeetMe, Inc. Code of Conduct and Ethics.

Prior to any termination for Cause pursuant to each such event listed in (ii), (iii), (iv), (v) or (vi) above, to the extent such event(s) is capable of being cured by Executive, the Company shall give Executive written notice thereof describing in reasonable detail the circumstances constituting Cause and Executive shall have the opportunity to remedy same within 30 days after receiving written notice.

(b) “ Code ” shall mean the Internal Revenue Code of 1986, as amended.

(c) “ Disability ” shall mean Executive has been unable to perform the essential functions of Executive’s position with the Company by reason of physical or mental incapacity for a period of six consecutive months, subject to any obligations or limitations imposed by federal, state or local laws, including any duty to accommodate Executive under the federal Americans with Disabilities Act.

(d) “ Good Reason ” shall mean the occurrence of one or more of the following, without Executive’s consent: (i) a material diminution by the Company of Executive’s authority, duties or responsibilities; (ii) a material change in the geographic location at which Executive must perform services under this Agreement (which, for purposes of this Agreement, means relocation of the offices of the Company at which Executive is principally employed to a location more than 25 miles from the location of such offices immediately prior to the relocation); (iii) a diminution in Executive’s Base Salary (other than an overall Company reduction of compensation affecting all other senior level executives of the Company, pari passu); (iv) a material diminution in the authority, duties, or responsibilities of the supervisor to whom Executive is required to report; or (v) any action or inaction that constitutes a material breach by the Company of this Agreement; provided that within 60 days following the first occurrence of any such event or condition, Executive shall have given written notice of termination to the Company in accordance with Section 4 and the Company shall not have fully corrected the event or condition within 30 days after such notice of termination is given. Termination of Executive’s employment by the Company for Cause, by Executive other than for Resignation for Good Reason or as a result of Executive’s death or Disability shall not be deemed to constitute or result in Resignation for Good Reason.

(e) “ Release ” shall mean a release of claims (other than claims for post-termination payment and benefits) approved by the Company.

(f) “ Termination Date ” shall mean the effective date of the termination of Executive’s employment relationship with the Company pursuant to this Agreement.

4. Notice of Termination . Any termination of Executive’s employment shall be communicated by a written notice of termination to the other party hereto given in accordance with Section 9. The notice of termination shall (i) indicate the specific termination provision in this Agreement relied upon, (ii) briefly summarize the facts and circumstances deemed to provide a basis for a termination of employment if for Cause or resignation for Good Reason, and (iii) specify the Termination Date in accordance with the requirements of this Agreement.

5. Restrictive Covenants .

5.1 Restrictive Covenants Agreement . As a condition of Executive’s employment and consideration for the terms of this Agreement, on or prior to the Effective Date, Executive has entered into the Company’s standard Confidential Information and Invention Assignment Agreement (the “ Restrictive Covenants Agreement ”) and agrees to be bound by the terms and conditions set forth therein. The terms of the Restrictive Covenants Agreement are hereby incorporated by reference.

5.2 Non-Competition . As additional consideration for the terms of this Agreement, during Executive’s employment with the Company and for the period of 12 months after Executive’s termination of employment with the Company for any reason, whether or not payments are being made under this Agreement, Executive shall not, directly or indirectly, in any territory or market in which the Company does business, or to Executive’s knowledge has plans to do business, render any material services for any organization, or engage in any business, that competes in any material respect with the business of the Company.

5.3 Equitable Relief; Survival .

(a) Executive acknowledges and agrees that the restrictions contained in this Section 5 are reasonable and necessary to protect and preserve the legitimate interests, properties, goodwill and business of the Company, that the Company would not have entered into this Agreement in the absence of such restrictions and that irreparable injury will be suffered by the Company should Executive breach any of the provisions of this Section. Executive represents and acknowledges that (i) Executive has been advised by the Company to consult Executive’s own legal counsel in respect of this Agreement, and (ii) Executive has had full opportunity, prior to execution of this Agreement, to review thoroughly this Agreement with Executive’s counsel.

(b) Executive further acknowledges and agrees that a breach of any of the restrictions in this Section 5 cannot be adequately compensated by monetary damages. Executive agrees that the Company shall be entitled to preliminary and permanent injunctive relief, without the necessity of proving actual damages or posting of any bond, as well as an equitable accounting of all earnings, profits and other benefits arising from any violation of this Section 5, which rights shall be cumulative and in addition to any other rights or remedies to which the Company may be entitled. In the event that any of the provisions of this Section 5 should ever be adjudicated to exceed the time, geographic, service, or other limitations permitted by applicable law in any jurisdiction, it is the intention of the parties that the provision shall be amended to the extent of the maximum time, geographic, service, or other limitations permitted by applicable law, that such amendment shall apply only within the jurisdiction of the court that made such adjudication and that the provision otherwise be enforced to the maximum extent permitted by law.

(c) Notwithstanding anything in this Agreement to the contrary, if Executive breaches any of Executive’s obligations under this Section 5, the Company shall thereafter be obligated only for the compensation and other benefits provided in any Company benefit plans, policies or practices then applicable to Executive in accordance with the terms thereof, and all payments under Section 2 of this Agreement shall cease and the Company may require that Executive repay all amounts theretofore paid to him pursuant to Section 2 and in such case Executive shall promptly repay such amounts.

(d) Executive irrevocably and unconditionally (i) agrees that any suit, action or other legal proceeding arising out of Section 5, including without limitation, any action commenced by the Company for preliminary and permanent injunctive relief and other equitable relief, shall be brought solely in a United States District Court for Pennsylvania, or if such court does not have jurisdiction or will not accept jurisdiction, in any court of general jurisdiction in Bucks County, Pennsylvania, (ii) consents to the exclusive jurisdiction of any such court in any such suit, action or proceeding, and (iii) waives any objection which Executive may have to the laying of venue of any such suit, action or proceeding in any such court. Executive also irrevocably and unconditionally consents to the service of any process, pleadings, notices or other papers in a manner permitted by the notice provisions of Section 9 hereof.

(e) The provisions of this Sections 5 shall survive any termination or expiration of this Agreement.

6. Non-Exclusivity of Rights; Resignation from Boards; Clawback .

(a) Nothing in this Agreement shall prevent or limit Executive’s continuing or future participation in or rights under any benefit, bonus, incentive or other plan or program provided by the Company and for which Executive may qualify; provided, however, that if Executive becomes entitled to and receives the payments described in Section 2.2(a) of this Agreement, Executive hereby waives Executive’s right to receive payments under any severance plan or similar program applicable to employees of the Company.

(b) If Executive’s employment with the Company terminates for any reason, Executive shall immediately resign from all boards of directors of the Company, any affiliates and any other entities for which Executive serves as a representative of the Company.

(c) Executive agrees that Executive will be subject to any compensation clawback, recoupment and anti-hedging policies that may be applicable to Executive as an executive of the Company and to all other executives of the Company, as in effect from time to time and as approved by the Board or a duly authorized committee thereof.

7. Survivorship . The respective rights and obligations of the parties under this Agreement (including without limitation Section 5) shall survive any termination of Executive’s employment or termination of this Agreement to the extent necessary to the intended preservation of such rights and obligations.

8. Mitigation . Executive shall not be required to mitigate the amount of any payment or benefit provided for in this Agreement by seeking other employment or otherwise, and there shall be no offset against amounts due Executive under this Agreement on account of any remuneration attributable to any subsequent employment that Executive may obtain.

9. Notices . All notices and other communications required or permitted under this Agreement or necessary or convenient in connection herewith shall be in writing and shall be deemed to have been given when hand delivered or mailed by registered or certified mail, or by a nationally recognized overnight delivery service, as follows (provided that notice of change of address shall be deemed given only when received):

If to the Company, to:

MeetMe, Inc.

100 Union Square Drive

New Hope, PA 18938

Attention: General Counsel

If to Executive, to:

Richard Friedman at the address in the Company’s payroll records,

or to such other names or addresses as the Company or Executive, as the case may be, shall designate by notice to each other person entitled to receive notices in the manner specified in this Section.

10. Executive’s Representations . Executive hereby represents and warrants to the Company that (a) the execution, delivery and performance of this Agreement by Executive do not and shall not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which Executive is a party or by which he is bound, (b) upon execution and delivery of this Agreement by the Company, this Agreement shall be the valid and binding obligation of Executive, enforceable in accordance with its terms, and (c) Executive is not subject to any pending, or to his knowledge, any threatened, lawsuit, action, investigation or proceeding involving Executive’s prior employment or consulting work or the use of any information or techniques of any former employer or contracting party. Executive hereby acknowledges and represents that he has consulted with independent legal counsel regarding his rights and obligations under this Agreement (including, the Restrictive Covenants Agreement) and that he fully understands the terms and conditions herein.

11. Non-Disparagement . Executive agrees that during the Employment Term and thereafter, he will not, directly or indirectly, publicly or privately, make, publish or solicit, or encourage others to make, publish or solicit, any disparaging statements, comments, announcements, or remarks concerning the Company or its affiliates, or any of their respective past and present directors, officers or employees, other than, during the Employment Term, in the good faith performance of Executive’s duties to the Company.

12. Indemnification . The Company hereby agrees, to the maximum extent permitted by law, to indemnify and hold Executive harmless against any costs and expenses, including reasonable attorneys’ fees, judgments, fines, settlements and other amounts incurred in connection with any proceeding arising out of, by reason of or relating to Executive’s good faith performance of Executive’s duties and obligations with the Company. The Company shall also provide Executive with coverage as a named insured under a directors and officers liability insurance policy maintained for the Company’s directors and officers. This obligation to provide insurance and indemnify Executive shall survive expiration or termination of this Agreement with respect to proceedings or threatened proceedings based on acts or omissions of Executive occurring during Executive’s employment with the Company or with any of its affiliates. Such obligations shall be binding upon the Company’s successors and assigns and shall inure to the benefit of Executive’s heirs and personal representatives.

13. Contents of Agreement; Amendment and Assignment .

(a) This Agreement sets forth the entire understanding between the parties hereto with respect to the subject matter hereof, including employment, termination and severance. This Agreement supersedes any and all and documents otherwise relating to the subject matter hereof. This Agreement cannot be changed, modified, extended or terminated except upon written amendment approved by the CEO and executed on behalf of the Company by a duly authorized officer of the Company and by Executive.

(b) All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective heirs, executors, administrators, legal representatives, successors and assigns of the parties hereto, except that the duties and responsibilities of Executive under this Agreement are of a personal nature and shall not be assignable or delegatable in whole or in part by Executive.

14. Severability . If any provision of this Agreement or application thereof to anyone or under any circumstances is adjudicated to be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect any other provision or application of this Agreement which can be given effect without the invalid or unenforceable provision or application and shall not invalidate or render unenforceable such provision or application in any other jurisdiction. If any provision is held void, invalid or unenforceable with respect to particular circumstances, it shall nevertheless remain in full force and effect in all other circumstances.

15. Remedies Cumulative; No Waiver . No remedy conferred upon a party by this Agreement is intended to be exclusive of any other remedy, and each and every such remedy shall be cumulative and shall be in addition to any other remedy given under this Agreement or now or hereafter existing at law or in equity. No delay or omission by a party in exercising any right, remedy or power under this Agreement or existing at law or in equity shall be construed as a waiver thereof, and any such right, remedy or power may be exercised by such party from time to time and as often as may be deemed expedient or necessary by such party in its sole discretion.

16. Cooperation . At the Company’s request, Executive agrees, to the extent permitted by law, to assist, consult with, and cooperate with the Company in any governmental filing, litigation, investigation, administrative procedures, or legal proceedings or inquiries that involve the Company, either now existing or which may hereafter be instituted by or against the Company, including but not limited to, appearing upon the Company’s reasonable request as a witness and/or consultant in connection with any litigation, investigation, administrative procedures, or legal proceedings or inquiries.

17. Beneficiaries/References . Executive shall be entitled, to the extent permitted under any applicable law, to select and change a beneficiary or beneficiaries to receive any compensation or benefit payable under this Agreement following Executive’s death by giving the Company written notice thereof. In the event of Executive’s death or a judicial determination of Executive’s incompetence, reference in this Agreement to Executive shall be deemed, where appropriate, to refer to Executive’s beneficiary, estate or other legal representative.

18. Miscellaneous . All section headings used in this Agreement are for convenience only. This Agreement may be executed in counterparts, each of which is an original. It shall not be necessary in making proof of this Agreement or any counterpart hereof to produce or account for any of the other counterparts.

19. Withholding Taxes . All payments under this Agreement shall be made subject to applicable tax withholding, and the Company shall withhold from any payments under this Agreement all federal, state and local taxes as the Company is required to withhold pursuant to any law or governmental rule or regulation. Executive shall be responsible for all taxes applicable to amounts payable under this Agreement.

20. Section 409A of the Code .

(a) This Agreement is intended to comply with Section 409A of the Code and its corresponding regulations, to the extent applicable. Severance benefits under the Agreement are intended to be exempt from Section 409A of the Code under the “short term deferral” exemption, to the maximum extent applicable, and then under the “separation pay” exemption, to the maximum extent applicable. Notwithstanding anything in this Agreement to the contrary, payments may only be made under this Agreement upon an event and in a manner permitted by Section 409A of the Code, to the extent applicable. As used in the Agreement, the term “termination of employment” shall mean Executive’s separation from service with the Company within the meaning of Section 409A of the Code and the regulations promulgated thereunder. In no event may Executive, directly or indirectly, designate the calendar year of a payment. For purposes of Section 409A of the Code, each payment hereunder shall be treated as a separate payment and the right to a series of payments shall be treated as the right to a series of separate payments. All reimbursements and in-kind benefits provided under the Agreement shall be made or provided in accordance with the requirements of Section 409A of the Code.

(b) Notwithstanding anything in this Agreement to the contrary, if required by Section 409A of the Code, if Executive is considered a “specified employee” for purposes of Section 409A of the Code and if payment of any amounts under this Agreement is required to be delayed for a period of six months after separation from service pursuant to Section 409A of the Code, payment of such amounts shall be delayed as required by Section 409A of the Code, and the accumulated amounts shall be paid in a lump sum payment within ten days after the end of the six month period. If Executive dies during the postponement period prior to the payment of benefits, the amounts withheld on account of Section 409A of the Code shall be paid to the personal representative of Executive’s estate within 60 days after the date of Executive’s death.

21. Governing Law; Jurisdiction . This Agreement shall be governed by and interpreted under the laws of the Commonwealth of Pennsylvania without giving effect to any conflict of laws provisions. Any disputes or proceedings related to this Agreement in any way, regardless of theory of claim, shall be brought solely in a United States District Court for Pennsylvania, or if such court does not have jurisdiction or will not accept jurisdiction, in any court of general jurisdiction in Bucks County, Pennsylvania.

22. Waiver of Jury Trial . AS SPECIFICALLY BARGAINED FOR INDUCEMENT FOR EACH OF THE PARTIES HERETO TO ENTER INTO THIS AGREEMENT (AFTER HAVING THE OPPORTUNITY TO CONSULT WITH COUNSEL), EACH PARTY HERETO EXPRESSLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LAWSUIT OR PROCEEDING RELATING TO OR ARISING IN ANY WAY FROM THIS AGREEMENT OR THE MATTERS CONTEMPLATED HEREBY.

[ Signature Page Follows ]

IN WITNESS WHEREOF, the undersigned, intending to be legally bound, have executed this Agreement as of te date first above, to be effective on the Effective Date.

MEEETME, INC.

By: /s/ Geoff Cook

Name: Geoff Cook

Title: Chief Executive Officer

/s/ Richard Friedman

Richard Friedman

Exhibit 10.3

The company has applied for confidential treatment of certain provisions of this exhibit with the securities and exchange commission. The confidential portions of this exhibit are bracketed and marked with asterisks ([***]) and have been omitted. The omitted portions of this exhibit will be filed separately with the securities and exchange commission pursuant to a request for confidential treatment.

Beanstock Publisher Agreement

CONTACT INFORMATION

Beanstock Media		PUBLISHER INFORMATION:
Company Name	Beanstock Media, Inc	Company Name	MeetMe, Inc.
Contact	Jim Waltz	Contact	Bill Alena
Company URL	www.beanstockmedia.com	Company URL	www.meetme.com and other properties as defined below
Address	530 Howard Street, 2 ^nd Floor	Address	100 Union Square Drive
City/State/ZIP	San Francisco, CA 94105	City/State/ZIP	New Hope, PA 18938
Email	jim@beanstockmedia.com	Email	bill@meetme.com
Phone	[]*	Phone	[]*

This Media Publisher Agreement constitute the entire agreement between Beanstock Media, Inc, a Delaware Corporation (“Beanstock”) and MeetMe, Inc., a Delaware corporation (“Publisher”) (the “Agreement”).

Whereas Beanstock agrees to purchase certain online display advertising inventory for Publisher and Publisher agrees, among other things, to grant Beanstock exclusive access to certain inventory, as further defined herein.

Beanstock and Publisher agree as follows:

1. Right and Obligation to Fill Inventory.

A. Exclusive Right and Obligation To Fill Sites. Subject to the limitations described in Section 1B below, Beanstock shall have the exclusive right and obligation to fill 100% of Publisher’s remnant desktop in-page display advertising inventory (“Remnant Display Inventory”) on the sites listed in Exhibit A (“Sites”).

B. Limitations. The Remnant Display Inventory described in Section 2 shall exclude (i) any inventory sold to any third party under an insertion order that is campaign specific or advertiser specific, whether or not such inventory is sold directly by Publisher or indirectly through an agent or reseller, (ii) any inventory reserved by Publisher, in its sole discretion, in existing and future agreements with third parties for barter transactions and as additional consideration as part of larger business development transactions wherein the commercial value of a third party’s services outweighs the benefits of Beanstock’s display monetization; provided, however, that Beanstock shall have the right to inquire about the business terms of those scenarios (subject to any confidentiality obligations by Publisher) and (iii) any inventory reserved for Premium Advertising for the Sites described in Section 1D below. In addition, notwithstanding anything to the contrary set forth herein, Publisher may continue to place inventory outside of this contract in direct sales (whether through advertising agencies or otherwise).

*** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST.

C. Ad-Server. Beanstock shall use its own or a third-party ad server, either AppNexus or that of another vendor reasonably acceptable to Publisher. Publisher shall not provide Beanstock with access to Publisher’s Dart For Publishers (“DFP”) account.

D. Premium Advertising. Beanstock will use its commercially reasonable efforts to create private or semi-private marketplaces (“PMP”) that may contain one or more buyers (e.g. advertiser, agency, trade desk, demand-side partner or other inventory supplier) who have been directly contacted by Beanstock and made aware of specific targeting or rich media opportunities agreed to by Publisher (“Premium Advertising”). Beanstock shall make available to Publisher a list of all buyers, a list of programmatic “deal IDs” and the composition of Publisher End Users’ data within those deal IDs.

E. Transfer of Accounts. Within ten (10) days following the Effective Date, Beanstock will replace Publisher’s Google AdX/Admeld exchange campaigns with Beanstock’s own Google AdX/Admeld exchange campaigns; provided, however, that all existing direct insertion orders for the Sites within Publisher’s existing Google AdX account must run through their contracted impressions and/or timeframe unless explicitly stated otherwise by Publisher.

2. Revenue/Payment:

a. Sites. During the Term, Beanstock shall guarantee to Publisher:

(i) for Remnant Display Inventory on Sites, a Net Revenue based on Schedule in Exhibit C; provided, however, that if Publisher creates additional ad positions on the site (e.g. pop unders, overlays, and various other ad formats not directly embedded on display pages), the guaranteed CPMs for Remnant Display Inventory may be subject to change and both parties will resolve such issues within 30 days. Beanstock shall pay for all ad requests that Publisher delivers hereunder (whether or not Beanstock fills them) (i) for the United States, at or above the CPM Guarantee rates set forth in Exhibit C plus the percentage indicated of Net Revenue that Beanstock invoices to third parties in excess of the minimum, and (ii) for the rest of the world, at 90% of Net Revenue. For example, if the CPM for March 2014 were $ [***] in the United States and internationally, then Beanstock would pay Publisher (i) for the United States, a CPM of $ [***] (the $ [***] minimum plus [***] % of Net Revenue in excess of the minimum), and (ii) for the rest of the world, a CPM of $ [***] (90% of Net Revenue).

“Net Revenue" shall mean revenue billed to advertisers by Beanstock, net of third party ad serving discrepancies; provided, however, that only up to [***] % of total monthly inventory may be adjusted downward due to actual and timely third party ad serving discrepancies.

b. Discrepancy. If Publisher’s reporting systems show a discrepancy of less than [***] % in any month in the number of impressions measured and reported by Beanstock, then Publisher shall issue an invoice based on numbers included in Beanstock’s reporting. In the event that Publisher’s reporting systems show a discrepancy of more than [***] percent ( [***] %) in any month in the number of impressions measured and reported by Beanstock, then Publisher shall issue an invoice based on numbers included in Publisher’s reporting, minus [***] %.

c. Payment. Beanstock will remit payments due to Publisher within sixty (60) days following the last day of each calendar month for that month regardless of advertiser campaign duration; provided, however, that in the event that the balance owing hereunder (whether or not yet due) exceeds $4 million, then Publisher may request Beanstock to accelerate payments hereunder such that said balance does not at any point exceed $4 million, and Beanstock shall do so within ten business days and for so long as necessary to keep said balance under $4 million. Beanstock assumes all risk in regards to collection of all applicable advertiser fees with respect to all of the advertising inventory provided in this Agreement and will not delay payment to Publisher as a result of non-collection or delay of payment of fees by the advertisers.

*** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST.

d. Audit. During the Term of the Agreement and for a period of five years thereafter, Beanstock shall maintain complete, clear and accurate records relating to its payment obligations to Publisher under this Agreement. Subject to the confidentiality obligations set forth herein, Publisher (or its representative) shall have the right to conduct a reasonable and necessary inspection of the books and records of Beanstock (including without limitation financial books and records) that are relevant to Beanstock’s performance (including payment) pursuant to this Agreement twice a year during any certain calendar year; provided that any such audit shall be conducted after five (5) business days’ prior written notice, the audit expenses shall be covered by Publisher, and the audit shall be conducted during normal business hours, at Beanstock’s offices.

3. License; Representations. Beanstock grants Publisher a non-exclusive, worldwide, non-transferable, royalty-free right and license, without right of sublicense, to transmit, publicly display, publicly perform, store, copy and distribute the ads on the Sites solely as specified under this Agreement. Beanstock hereby warrants that the terms of its advertiser agreements will not conflict with or breach this Agreement and will comply with the terms of this Agreement. Beanstock represents and warrants that: (i) Beanstock has the right to grant the license granted to Publisher herein; (ii) the ads do not, and Beanstock’s placement of them in accordance with this Agreement will not, (a) violate any international, federal, state or local law or regulation, (b) infringe upon or misappropriate any third party right, including any copyright, trademark, patent, trade secret, or any other intellectual property or proprietary right, or (c) misappropriate any third party’s name or likeness or violate any third party’s right of privacy, publicity, or any other right of any third party, (iii) Beanstock will not repackage, resell or remonetize data collected by Beanstock on the Sites through the use of any cookie provided by or used by Beanstock, unless Beanstock has obtained written consent from an authorized officer of Publisher to such use, (iv) Beanstock’s use of such data shall be in accordance with applicable laws and regulations, (v) Beanstock has the right and authority to use the sell-side platform technology under this Agreement, and (vi) Beanstock shall comply at all times with Publisher’s Terms of Service and Privacy Policy as in effect from time to time.

4. Ad Guidelines. All ads delivered by Beanstock shall comply with Publisher’s standard advertising editorial guidelines, attached to this Agreement as Exhibit B, which Publisher may revise from time to time in its sole discretion. Publisher reserves the right to review and pre-approve all ads prior to their display on the Publisher’s Sites in such a way that could otherwise cause Publisher’s liability to a third party or damage to its reputation and goodwill. Publisher may reject any ad. In the event Publisher requests the removal of any specific ad or ads of any specific advertiser or group of advertisers, Beanstock shall remove such ads within two hours. Without limiting Publisher’s other remedies under this Agreement, in the event Beanstock continues to traffic ads that have been rejected by Publisher or that do not comply with Publisher’s standard advertising editorial guidelines after receiving notice of such rejection or noncompliance, Beanstock’s exclusivity rights as set forth in Section 1 above shall no longer apply for a period of 90 days starting on the date when Beanstock’s breach was discovered by Publisher; provided, however, that Beanstock’s obligation to pay for all ad requests during such 90 day period shall remain unaffected thereby.

5. Transparency. Beanstock will provide 100% gross and net revenue transparency to Publisher via Beanstock dashboard which shall be accessible to Publisher by log-in on a 24/7 basis. One seat (license) shall also be granted to Publisher directly on Beanstock’s sell-side platform in order for Publisher to gain direct insight and reporting of Publisher revenue and inventory utilization.

6. Reporting. Tracking of measurements applicable on which impression request is calculated will be determined by Beanstock or by a third party designated by Beanstock in accordance with Beanstock’s reporting and/or tracking procedures available via Beanstock’s ad server. Beanstock will provide reported impression delivery that will include but not be limited to the following details (advertiser, platform used, bids and ads bought per advertiser (by CPM, impressions and targeting (deal IDs)) by the 10th day of every month for the prior month. For the purpose of clarity, Beanstock’s reporting will consist of a combination of AppNexus, Right Media, Google AdX, and any other 3rd party system Beanstock chooses (and which is reasonably acceptable to Publisher) to utilize in providing this service.

7. Term. This Agreement shall become effective on September 23, 2013 (“Effective Date”) and shall remain effective through December 31, 2015 (the “Term”), unless terminated in accordance with the terms of this Agreement.

8. Termination.

a. By Publisher. Publisher may terminate this Agreement at any time without charge or penalty for any reason or no reason by providing written notice thereof to Beanstock.

b. Material Breach. Either party may terminate this Agreement at any time if the other party is in material breach of its obligations hereunder, which breach is not cured within 10 days after receipt of written notice thereof from the non-breaching party.

c. Insolvency. Either party may immediately terminate this Agreement at any time upon written notice to the other party if the other party files a petition for bankruptcy, becomes insolvent, makes an assignment for the benefit of its creditors, or a receiver is appointed for such other party or its business.

d. Effect of Termination. As promptly as possible but in any event within 30 days of any termination of this Agreement, Beanstock shall pay to Publisher all amounts owing hereunder as of the date of such termination. At the request of Publisher in its sole discretion, there will be a winding down period of ninety (90) days from the date of termination (the “Winding Down Period”). During the Winding Down Period, (i) the exclusivity provisions for the Sites under Section 1 of this Agreement shall no longer apply and Publisher shall have the sole discretion to provide Beanstock with advertising inventory; and (ii) Beanstock shall be entitled to collect from advertisers all revenue paid during and after the Winding Down Period and shall pay Publisher its guaranteed revenue or revenue share as provided for in Section 2.

9. Data Collection, Cookies and Privacy.

a. Beanstock shall use commercially reasonable efforts to maintain technical and organizational security measures, backup systems and procedures to protect against loss of data.

b. Beanstock has the right to use “cookies” or other means of capturing data in compliance with Publisher’s Terms of Service and Privacy Policy rules relating to the Sites solely and exclusively to ensure performance of its obligations and compliance with this Agreement. Data collected from end users of Publisher (“Publisher End Users”) shall not be used for any other purpose, including without limitation for tracking and retargeting users for the purpose of gaining profit or performing IOs signed between Beanstock and other publishers. In addition, no data management platform may be used that is not approved by Publisher, such approval not to be unreasonably withheld. Beanstock shall maintain membership with the Network Advertising Initiative (the "NAI") and comply in all respects with the NAI Principles, as published. All tracking devices used by Beanstock shall enable end users to opt out of behavioral targeting by Beanstock through the single opt out link located at http://www.networkadvertising.org/managing/opt_out.asp. Beanstock shall also maintain membership and participation in the Digital Advertising Alliance's (DAA) Self-Regulatory Program for Online Behavioral Advertising and all ads served by Beanstock pursuant to this Agreement shall include an “ad Choices” link within the ad unit that links to http://www.aboutads.info/choices/ or any successor page thereto.

c. In addition to Publisher’s Terms of Service and Privacy Policy, to the extent that Beanstock collects Personal Data from Publisher End Users, the following sections shall be applicable:

“Personal Data” shall mean “personal data” as defined in the European Union Data Protection Directive (Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995) (the “Directive”) and applicable national laws implementing the Directive that is collected by Beanstock through means of a cookie dropped on the personal computers of Publisher End Users located in countries within the European Economic Area, and shall include, but not be limited to, IP addresses of Publisher End Users and all data associated with such IP address such as Web pages viewed, the date and time at which those pages were viewed and interaction with content and advertisements on those Web pages.

Beanstock shall process the Personal Data solely to perform the advertising campaigns of Publisher in compliance with this Agreement between Beanstock and Publisher, and as instructed by Publisher from time to time, and Beanstock further agrees that if it cannot provide such compliance for whatever reason, it shall promptly inform Publisher of its inability to comply, in which case Publisher may suspend the transfer of Personal Data and/or terminate any existing Insertion Order immediately upon written notice.

In using Personal Data for any of Beanstock’s activities, Beanstock acknowledges that Beanstock shall be regarded as the Data Controller, as defined in the Directive, and shall indemnify Publisher, its subsidiaries and shareholder against any third party claim or European Union Member State data protection agency action relating to Beanstock’s use of the Personal Data outside the scope of performance of this Agreement executed with Publisher, provided that Publisher (i) provides prompt written notice of the claim to Beanstock, provided that any delay in providing notice shall not relieve Beanstock of its indemnity obligations under this Agreement unless, and only to the extent, Beanstock was prejudiced by the delay; (ii) affords Beanstock the right to control the defense and all negotiations relative to the settlement of any such claim, provided that no settlement admitting liability on the part of Publisher, imposing restrictions on Publisher, or requiring any action or inaction by Publisher, including without limitation, the payment of any amounts, may be made without the express written consent of Publisher, such consent not to be unreasonably conditioned, delayed or withheld; and (iii) reasonably cooperates with and provides reasonable assistance and information to Beanstock and its counsel at Beanstock’s reasonable cost and expense.

Beanstock agrees, warrants and/or undertakes to maintain the Personal Data in confidence and not to disclose it to any third party without the written agreement of Publisher;

Beanstock represents and warrants that it has implemented and will maintain technical and organizational security measures with regard to the Personal Data including (i) limiting access to those employees or contractors with a need to access that Personal Data to perform the functions for which the data is provided to Beanstock; (ii) protection of Personal Data being transmitted and stored; (iii) monitoring for unauthorized access to Personal Data; (iv) physical access controls; (v) incident management techniques and procedures; (vi) employee training; and (vii) backup systems and procedures to protect against loss of data.

Beanstock shall promptly notify Publisher of:

(i) any legally-binding request for disclosure of Personal Data by a law enforcement authority;

(ii) any accidental or unauthorized access of which Beanstock becomes aware through use of the technical and organizational security measures set forth above; and

(iii) any requests received directly from the Publisher End User to which the Personal Data relates, provided that Beanstock shall not respond to any such request unless authorized to do so by Publisher (for the sake of clarity, this excludes opt out requests through the single opt’out link located at http://www.networkadvertising.org/managing/opt_out.asp).

Beanstock shall deal promptly and properly with all inquiries from Publisher relating to the processing of Personal Data and to comply with the advice of any regulatory or supervisory authority with regard to the processing of such Personal Data.

At the reasonable request of Publisher and subject to the confidentiality obligations set forth herein, Beanstock shall submit its data processing facilities for audit of the processing activities covered by this section, which audit shall be carried out by an inspection body composed of independent members, mutually agreed upon and selected by Beanstock and Publisher in agreement with the relevant regulatory or supervisory authority where applicable, and possessing the required professional qualifications.

10. [Reserved].

11. Indemnity.

a. Beanstock Indemnity. Beanstock agrees to indemnify, defend and hold harmless the Publisher and its respective officers, directors, employees, representatives and agents from and against all claims, actions, liabilities, losses, expenses, suits, actions and proceedings incurred in connection with any breach of such breaching party’s representations, warranties, covenants, obligations and agreements under this Agreement and as a result of an alleged or actual infringement by any advertisement of a third party intellectual property, publicity or privacy right. Any claim for indemnification hereunder shall be subject to the following provisions: (i) the indemnifying party shall be given prompt written notice of the claim by the indemnified party, provided that any delay in providing notice shall not relieve the indemnifying party of its indemnity obligations under this Agreement unless, and only to the extent, the indemnifying party was prejudiced by the delay; (ii) the indemnifying party shall have the right to control the defense and all negotiations relative to the settlement of any such claim, provided that no settlement admitting liability on the part of the indemnified party, imposing restrictions on the indemnified party, or requiring any action by the indemnified party, including without limitation, the payment of any amounts, may be made without the express written consent of the indemnified party, such consent not to be unreasonably conditioned, delayed or withheld; and (iii) the indemnified party shall reasonably cooperate with and provide reasonable assistance and information to the indemnifying party and its counsel at the indemnifying party’s reasonable cost and expense. In the event that Publisher brings any action for collection or otherwise relating to nonpayment (including without limitation of indemnification obligations) hereunder, Beanstock shall pay Publisher’s reasonable legal and other fees related to such action regardless of settlement, satisfaction or outcome.

b. Publisher Indemnity. Publisher agrees to indemnify, defend and hold harmless Beanstock and its respective officers, directors, employees, representatives and agents from and against all claims, actions, liabilities, losses, expenses, suits, actions and proceedings incurred in connection with any breach of such breaching party’s representations, warranties, covenants, obligations and agreements under this Agreement and as a result of an alleged or actual infringement by Publisher’s website (excluding any advertisements thereon) of a third party intellectual property, publicity or privacy right. Any claim for indemnification hereunder shall be subject to the following provisions: (i) the indemnifying party shall be given prompt written notice of the claim by the indemnified party, provided that any delay in providing notice shall not relieve the indemnifying party of its indemnity obligations under this Agreement unless, and only to the extent, the indemnifying party was prejudiced by the delay; (ii) the indemnifying party shall have the right to control the defense and all negotiations relative to the settlement of any such claim, provided that no settlement admitting liability on the part of the indemnified party, imposing restrictions on the indemnified party, or requiring any action by the indemnified party, including without limitation, the payment of any amounts, may be made without the express written consent of the indemnified party, such consent not to be unreasonably conditioned, delayed or withheld; and (iii) the indemnified party shall reasonably cooperate with and provide reasonable assistance and information to the indemnifying party and its counsel at the indemnifying party’s reasonable cost and expense.

12. Confidentiality. In the performance of its obligations under this Agreement, each party acknowledges that it may have access or be exposed to Confidential Information of the other party. “Confidential Information” means any and all non-public information, documents, data and know-how that is proprietary or not generally known in nature, or designated as Confidential Information by a party, or which a party should reasonably know to be confidential in nature, which either party may disclose to the other party pursuant to or in connection with this Agreement or any IO relating to its products, services, business, prices, and requirements, as well as the terms and conditions of this Agreement or any IO, whether in written, oral, graphic or electronic form. The party in receipt of the Confidential Information (the “Receiving Party”) of the other party (the “Disclosing Party”) understands and agrees that it will not disclose such Confidential Information directly or indirectly to any third party (other than Receiving Party’s employees, and/or outside advisors with a need to know such information) or use such Confidential Information for any other purpose other than in performance of this Agreement or any IO without the Disclosing Party’s prior written consent. The Receiving Party agrees that it will employ all reasonable steps to protect the Confidential Information from unauthorized or inadvertent disclosure or use, including without limitation, all steps it takes to protect its own information that it considers proprietary or trade secrets, but in no event less than a commercially reasonable standard of care. Confidential Information does not include that which: (a) was already known to the Receiving Party prior to disclosure by the Disclosing Party as established by documentary evidence, and is legally in the Receiving Party’s possession at the time of disclosure without the obligation to the Disclosing Party of confidentiality; (b) is or has become part of the public knowledge or literature, not as a result of any action or omission of the Receiving Party; (c) has been rightfully received by the Receiving Party from a third party and to the Receiving Party’s knowledge, without breach of any obligation of confidentiality of such third party to the Disclosing Party or (d) is independently developed by the Receiving Party without access or reference to the Confidential Information. The Receiving Party may disclose Confidential Information as required (i) pursuant to a judicial or governmental order, or valid subpoena, provided that such party will, unless prohibited by such order or subpoena, promptly notify the Disclosing Party orally and in writing, to allow the Disclosing Party the opportunity to intervene in response to such order, and (ii) by securities laws or the rules or regulations of the Securities and Exchange Commission or any stock exchange. The parties acknowledge that unauthorized disclosures of Confidential Information in violation of this Section 11 could cause irreparable harm and significant injury to the Disclosing Party which may be difficult to limit or quantify; accordingly, the Disclosing Party shall have the right to seek an immediate injunction against the Receiving Party due to any breach of confidentiality, in addition to any other remedies that may be available to such party at law or in equity. Upon termination of this Agreement for any reason, or upon request of the Disclosing Party, each party will promptly certify destruction of, all Confidential Information, and any copies thereof, in its possession.

13. Limitation of Liability. NEITHER PARTY WILL BE LIABLE TO THE OTHER FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, SPECIAL OR OTHER SIMILAR DAMAGES. NOTWITHSTANDING THE FOREGOING, (A) THE LIMITATIONS SET FORTH IN THIS SECTION 13 SHALL NOT APPLY TO LIABILITIES ARISING OUT OF A BREACH OF A PARTY’S CONFIDENTIALITY OBLIGATIONS SET FORTH HEREIN OR A PARTY’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT AND (B) EACH PARTY SHALL REMAIN LIABLE TO THE OTHER PARTY TO THE EXTENT DAMAGES, INCLUDING WITHOUT LIMITATION, ANY DAMAGES DISCLAIMED IN THIS SECTION 13, ARE CLAIMED BY A THIRD PARTY AND ARE SUBJECT TO INDEMNIFICATION AS SET FORTH ABOVE. EXCEPT FOR BREACHES OF THE CONFIDENTIALITY OBLIGATIONS SET FORTH IN SECTION 12, INDEMNITY OBLIGATIONS SET FORTH IN SECTIONS 9 AND 11, WILLFUL BREACH AND GROSS NEGLIGENCE, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, IN NO EVENT SHALL EITHER PARTY’S TOTAL AGGREGATE LIABILITY UNDER THIS AGREEMENT EXCEED THE AMOUNTS PAID TO PUBLISHER UNDER THIS AGREEMENT; PROVIDED THAT SUCH LIABILITY AMOUNT SHALL NOT INCLUDE OR APPLY TO, IN THE CASE OF PUBLISHER, AMOUNTS OWING UNDER THIS AGREEMENT.

14. Publicity. Except as required by securities laws or the rules or regulations of the Securities and Exchange Commission or any stock exchange, in no event shall either party publicly disclose, reference or refer to the negotiation or the existence of this Agreement or its work for, and relationship with, the other party for any purpose (including but not limited to marketing and promotional services), without the express prior written consent of the other party.

15. Miscellaneous.

a. Notices. All notices, reports, and receipts shall be in writing and shall be deemed duly given on (a) the date of personal or courier delivery; (b) the date of transmission by telecopy or other electronic transmission service; or (c) three (3) business days after the date of deposit in the United States mails, by postage-paid, return-receipt requested, first-class mail, addressed as follows:

If to Beanstock:

If to Publisher:

Beanstock, Inc.

MeetMe, Inc.

530 Howard St., 2 ^nd Floor

100 Union Square Drive

San Francisco, CA 94105

New Hope, PA 18938

Attention: Jim Waltz

Attention: Fred Beckley

email: jimwaltz@beanstockmedia.com

email: fred@meetme.com

Either party may change its mailing address by written notice to the other party in accordance with this paragraph.

b. Assignment. The parties may not assign this Agreement without the prior written consent of the other party. Consent to any assignment shall not be deemed to be consent to any subsequent assignment, and each assignment must be with the prior written consent of the other party. Notwithstanding the foregoing, either party may assign any of its right or interest to an affiliated party or to an unrelated party pursuant to a sale, merger, reorganization or other consolidation of any of its operating divisions or product lines without prior notice to or the prior written consent of the other party. Any purported assignment in contravention of this section shall be null and void from the beginning.

c. Governing Law/Personal Jurisdiction. The parties mutually acknowledge and agree that this Agreement shall be construed and enforced in accordance with the internal laws of the State of Delaware, without regard to principles of conflicts of laws. All actions hereunder or related hereto, regardless of theory or claim, shall be brought and tried solely and exclusively in the state and federal courts located in Wilmington, Delaware and the parties hereby expressly consent to the exclusive personal jurisdiction thereof; provided, however, that all actions hereunder for the collection of unpaid amounts shall be brought and tried solely and exclusively in the state and federal courts located in Philadelphia, Pennsylvania and the parties hereby expressly consent to the exclusive personal jurisdiction of said courts for such actions.

d. This Agreement shall in no way constitute or give rise to a partnership between the parties. All operations by each party under the terms of this Agreement shall be carried on by it as independent contractor and not as an agent for the other.

e. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Agreement.

f. This Agreement and any documents incorporated by reference constitute the entire agreement and understanding between the parties regarding the subject matter of this Agreement and supersedes and merges all prior discussions and agreements between them relating to this Agreement. No modification or amendment to this Agreement, either oral or written, shall be valid unless placed in writing and signed by an authorized officer of each of the parties. No waiver under this Agreement shall be effective unless in writing by a person authorized to grant such a waiver, and no waiver shall be deemed to be ongoing or for any other instance of the same activity unless the express terms of said waiver so specify, and then only to such extent. No usage of trade or course of dealing between or among any persons having any interest in this Agreement will be deemed effective to modify, amend, or discharge any part of this Agreement or any rights or obligations of any party.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized corporate officers as of the day and year first above written.

Beanstock Media, Inc. By: /s/ Jim Waltz	MeetMe, Inc. By: /s/ Geoff Cook

Name: Jim Waltz	Name: Geoff Cook

Title: CEO	Title: CEO

EXHIBIT A:

LIST OF PUBLISHER WEB SITES GOVERNED BY THIS AGREEMENT:

“Sites” shall include the following urls:

Meetme.com

EXHIBIT B

Advertising Content Guidelines

The following advertisers will be excluded from being delivered on MeetMe.com

Banned advertisers:

• [ *** ]

• [ ***

• [ *** ]

• [ *** ]

The following creative types will be excluded from being delivered on MeetMe.com

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[ *** ] :

[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]:

[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

■

[*** ]

*** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST.

■

[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

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[ *** ]

*** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST.

EXHIBIT C

Payment Schedule

Beanstock will manage all display ad impressions delivered on MeetMe.com under the following payment schedule.

Timing	CPM Guarantee	Additional Rev Share
Q3 2013	$ [ ******* ]	n/a
Q4 2013	$ [ ******* ]	[ ******* ] above minimum
Jan-14	$ [ ******* ]	[ ******* ] above minimum
Feb-14	$ [ ******* ]	[ ******* ] above minimum
Mar-14	$ [ ******* ]	[ ******* ] above minimum
Q2 2014	$ [ ******* ]	[ ******* ] above minimum
Q3 2014	$ [ ******* ]	[ ******* ] above minimum
Q4 2014	$ [ ******* ]	[ ******* ] above minimum
Jan-15	$ [ ******* ]	[ ******* ] above minimum
Feb-15	$ [ ******* ]	[ ******* ] above minimum
Mar-15	$ [ ******* ]	[ ******* ] above minimum
Q2 2015	$ [ ******* ]	[ ******* ] above minimum

● Beanstock will pay net 60 on all revenue ● Payable on Beanstock Impression Counts up to [ ******* ] discrepancy
● Revenue shares based on Net Revenue
● Rate schedule is for all US web display ad inventory including ATF and BTF and mobile web ● 90% revenue share to MeetMe for non-US display inventory

All direct sold advertising from MeetMe’s brand and Inside sales team will be managed and trafficked by MeetMe directly.

MeetMe.com has three non-standard media placements that Beanstock will be managing. The placements and details are as follows …

●

[ *** ] ( [ *** ] monthly impressions max. – no auto expansion or auto-audio)

[ *** ] pushdowns

site skins

●

large ads below messages section ( [ *** ] max size)

The Standard ad units are as follows…

●

[ *** ]

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[ ***]

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[ *** ]

●

[ *** ]

*** CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND WILL BE FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST.

Exhibit 31.1

CERTIFICATION REQUIRED BY RULE 13a-14(a) OF

THE SECURITIES EXCHANGE ACT OF 1934

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Geoffrey Cook, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of MeetMe, 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;

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:

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;

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;

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 based on our evaluation as of the end of the period covered by this report based on such evaluation; and

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):

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

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.

Date: November 8, 2013

By:

/s/ Geoffrey Cook

Geoffrey Cook

Chief Executive Officer

(Principal Executive Officer)

Exhibit 31.2

CERTIFICATION REQUIRED BY RULE 13a-14(a) OF

THE SECURITIES EXCHANGE ACT OF 1934

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, David Clark, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of MeetMe, 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;

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):

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.

Date: November 8, 2013

By:

/s/ David Clark

David Clark

Chief Financial Officer

(Principal Financial Officer)

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of MeetMe, Inc. (the “Company”) on Form 10-Q for the quarter ending September 30, 2013, as filed with the Securities and Exchange Commission on the date hereof, I, Geoffrey Cook, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to my knowledge::

1.	The quarterly report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; and

2.	The information contained for the quarterly report fairly presents, in all material respects, the financial condition and results of operations of the Company for the period covered by the quarterly report.

/s/ Geoffrey Cook

Geoffrey Cook

Chief Executive Officer

(Principal Executive Officer)

Dated: November 8, 2013

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of MeetMe, Inc. (the “Company”) on Form 10-Q for the quarter ending September 30, 2013, as filed with the Securities and Exchange Commission on the date hereof, I, David Clark, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to my knowledge::

1.	The quarterly report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; and

2.	The information contained for the quarterly report fairly presents, in all material respects, the financial condition and results of operations of the Company for the period covered by the quarterly report.

/s/ David Clark

David Clark

Chief Financial Officer

(Principal Financial Officer)

Dated: November 8, 2013

	Borrowings		Interest Rates			September 30, 2013		December 31, 2012
Growth term loans:
LSA2	$	97,500		12.50%		$	-	$	125,679
Equipment term loans:
SLSA		2,500,000		12.60%			-		-
S2LSA		2,500,000		12.50%			26,259		496,381
LSA2		8,607		12.50%			831,060		1,762,061
Growth capital loan		5,000,000		11.00%			4,952,896		-
Less: unamortized discount		-					(257,520)		-
		10,106,107					5,552,695		2,384,121

Capital leases			6.46%	-	7.99%		1,662,436		1,397,970
			4.50%	-	7.40%		197,396		308,833
							1,859,832		1,706,803

Loans payable - current portion							2,517,856		1,903,368
Capital lease - current portion							911,602		648,573
Long term debt - current portion						$	3,429,458	$	2,551,941

Loans payable - long term portion						$	3,034,837	$	480,753
MATT note payable		$5,000,000		4.46%			-		5,000,000
RSI note payable		2,000,000		4.46%			-		2,000,000
							3,034,837		7,480,753
Add: accrued interest							-		1,686,973
Less: unamortized discounts							-		(1,069,168	)
Total notes payable - long term portion							3,034,837		8,098,558
Capital lease - long term portion							948,230		1,058,230
Long term debt, net of discounts						$	3,983,067	$	9,156,788

September 30, 2013	Payments
Remainder of 2013	$	510,250
2014		998,294
2015		459,387
2016		467,182
2017		114,981
Thereafter		-
Total minimum payments	$	2,550,094

	●	User Engagement: We believe changes in user engagement patterns affect our revenue and financial performance. Specifically, the number of visits and page views each MAU or DAU generates affects the number of advertisements we are able to display and therefore the rate at which we are able to monetize our active user base. We continue to create new features and enhance existing features to drive additional engagement.

If to Beanstock:	If to Publisher:
Beanstock, Inc.	MeetMe, Inc.
530 Howard St., 2 ^nd Floor	100 Union Square Drive
San Francisco, CA 94105	New Hope, PA 18938
Attention: Jim Waltz	Attention: Fred Beckley
email: jimwaltz@beanstockmedia.com	email: fred@meetme.com