Delaware
|
|
33-0711569
|
(State or other jurisdiction of incorporation or
organization)
|
|
(I.R.S. Employer Identification Number)
|
|
|
|
18872 MacArthur Boulevard, Suite 200, Irvine,
California
|
|
92612
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer [ ]
|
Accelerated filer [X]
|
Emerging growth company [ ]
|
Non-accelerated filer [ ]
|
Smaller reporting company [ ]
|
|
(Do not check if a smaller
reporting company)
|
|
|
|
INDEX
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|
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Page
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1
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2
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3
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4
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16
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20
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20
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22
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23
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March 31,
2018
|
December 31,
2017
|
Assets
|
|
|
Current
assets:
|
|
|
Cash
and cash equivalents
|
$
15,159
|
$
24,993
|
Short-term
investment
|
255
|
254
|
Accounts
receivable, net of allowances for bad debts and customer credits of
$857 and $892 at March 31, 2018 and December 31, 2017,
respectively
|
25,024
|
25,911
|
Prepaid
expenses and other current assets
|
1,667
|
1,805
|
Total
current assets
|
42,105
|
52,963
|
Property
and equipment, net
|
4,070
|
4,311
|
Investments
|
100
|
100
|
Intangible
assets, net
|
27,426
|
29,113
|
Goodwill
|
—
|
5,133
|
Long-term
deferred tax asset
|
—
|
692
|
Other
assets
|
1,269
|
601
|
Total
assets
|
$
74,970
|
$
92,913
|
Liabilities and Stockholders’ Equity
|
|
|
Current
liabilities:
|
|
|
Accounts
payable
|
$
5,984
|
$
7,083
|
Accrued
employee-related benefits
|
1,925
|
2,411
|
Other
accrued expenses and other current liabilities
|
7,473
|
7,252
|
Current
convertible note payable
|
1,000
|
—
|
Total
current liabilities
|
16,382
|
16,746
|
Convertible
note payable
|
—
|
1,000
|
Borrowings
under revolving credit facility
|
—
|
8,000
|
Total
liabilities
|
16,382
|
25,746
|
Commitments
and contingencies (Note 10)
|
—
|
—
|
Stockholders’
equity:
|
|
|
Preferred
stock, $0.001 par value, 11,445,187 shares authorized
|
|
|
Series
A Preferred stock, none issued and outstanding
|
—
|
—
|
Common
stock, $0.001 par value; 55,000,000 shares authorized and
12,896,225 and 13,059,341 shares issued and outstanding at March
31, 2018 and December 31, 2017, respectively
|
13
|
13
|
Additional
paid-in capital
|
357,754
|
356,054
|
Accumulated
deficit
|
(299,179
)
|
(288,900
)
|
Total
stockholders’ equity
|
58,588
|
67,167
|
Total
liabilities and stockholders’ equity
|
$
74,970
|
$
92,913
|
|
Three Months Ended
March 31,
|
|
|
2018
|
2017
|
Revenues:
|
|
|
Lead
fees
|
$
24,080
|
$
29,092
|
Advertising
|
8,087
|
7,969
|
Other
revenues
|
182
|
280
|
Total
revenues
|
32,349
|
37,341
|
Cost
of revenues
|
24,659
|
24,430
|
Gross
profit
|
7,690
|
12,911
|
Operating
expenses:
|
|
|
Sales
and marketing
|
3,712
|
3,763
|
Technology
support
|
3,385
|
3,253
|
General
and administrative
|
4,575
|
3,457
|
Depreciation
and amortization
|
1,160
|
1,229
|
Goodwill
impairment
|
5,133
|
—
|
Total
operating expenses
|
17,965
|
11,702
|
|
|
|
Operating
income (loss)
|
(10,275
)
|
1,209
|
Interest
and other income (expense), net
|
—
|
(100
)
|
Income
(loss) before income tax provision
|
(10,275
)
|
1,109
|
Income
tax provision
|
4
|
625
|
Net
income (loss) and comprehensive income (loss)
|
$
(10,279
)
|
$
484
|
|
|
|
Basic
earnings (loss) per common share
|
$
(0.81
)
|
$
0.04
|
|
|
|
Diluted
earnings (loss) per common share
|
$
(0.81
)
|
$
0.04
|
|
Three Months Ended
March 31,
|
|
|
2018
|
2017
|
Cash
flows from operating activities:
|
|
|
Net
income (loss)
|
$
(10,279
)
|
$
484
|
Adjustments
to reconcile net income (loss) to net cash (used in) provided
by operating activities:
|
|
|
Depreciation
and amortization
|
2,179
|
1,841
|
Provision
for bad debts
|
69
|
43
|
Provision
for customer credits
|
65
|
94
|
Share-based
compensation
|
1,626
|
1,011
|
Change
in deferred tax asset
|
692
|
334
|
Goodwill
impairment
|
5,133
|
—
|
Changes
in assets and liabilities:
|
|
|
Accounts
receivable
|
753
|
4,980
|
Prepaid
expenses and other current assets
|
137
|
16
|
Other
assets
|
(668
)
|
44
|
Accounts
payable
|
(1,099
)
|
(2,527
)
|
Accrued
expenses and other current liabilities
|
(265
)
|
(2,858
)
|
Net
cash (used in) provided by operating activities
|
(1,657
)
|
3,462
|
Cash
flows from investing activities:
|
|
|
Purchases
of property and equipment
|
(250
)
|
(163
)
|
Net
cash used in investing activities
|
(250
)
|
(163
)
|
Cash
flows from financing activities:
|
|
|
Payments
on term loan borrowings
|
—
|
(2,625
)
|
Proceeds
from exercise of stock options
|
73
|
457
|
Payments
on revolving credit facility
|
(8,000
)
|
—
|
Net
cash used in financing activities
|
(7,927
)
|
(2,168
)
|
Net
(decrease) increase in cash and cash equivalents
|
(9,834
)
|
1,131
|
Cash
and cash equivalents, beginning of period
|
24,993
|
38,512
|
Cash
and cash equivalents, end of period
|
$
15,159
|
$
39,643
|
|
|
|
Supplemental
disclosure of cash flow information:
|
|
|
Cash
paid for income taxes
|
$
—
|
$
—
|
Cash
paid for interest
|
$
73
|
$
356
|
|
Three Months Ended
March 31,
|
|
|
2018
|
2017
|
|
(in thousands)
|
|
Lead
fees
|
$
24,080
|
$
29,092
|
Advertising
|
|
|
Clicks
|
6,691
|
6,514
|
Display and other
advertising
|
1,396
|
1,455
|
Other
revenues
|
182
|
280
|
Total
revenue
|
$
32,349
|
$
37,341
|
|
Three Months Ended
March 31,
|
|
|
2018
|
2017
|
Basic
Shares:
|
|
|
Weighted
average common shares outstanding
|
13,010,948
|
11,025,864
|
Weighted
average unvested restricted stock
|
(393,890
)
|
(116,667
)
|
Basic
Shares
|
12,617,058
|
10,909,197
|
|
|
|
Diluted
Shares:
|
|
|
Basic
shares
|
12,617,058
|
10,909,197
|
Weighted
average dilutive securities
|
—
|
2,399,938
|
Diluted
Shares
|
12,617,058
|
13,309,135
|
|
Three Months Ended
March 31,
|
|
|
2018
|
2017
|
|
(in thousands)
|
|
Share-based
compensation expense:
|
|
|
Cost
of revenues
|
$
15
|
$
20
|
Sales
and marketing
|
225
|
412
|
Technology
support
|
153
|
128
|
General
and administrative
(1)
|
1,234
|
452
|
Share-based
compensation costs
|
1,627
|
1,012
|
|
|
|
Amount
capitalized to internal use software
|
1
|
1
|
Total
share-based compensation costs
|
$
1,626
|
$
1,011
|
|
Three Months Ended
March 31,
|
|
|
2018
|
2017
|
|
|
|
Number
of service-based options granted
|
1,500
|
319,250
|
Weighted
average grant date fair value
|
$
4.30
|
$
6.91
|
Weighted
average exercise price
|
$
8.19
|
$
13.81
|
|
Three Months Ended
March 31,
|
|
|
2018
|
2017
|
|
|
|
Number
of stock options exercised
|
15,217
|
58,959
|
Weighted
average exercise price
|
$
4.80
|
$
7.75
|
|
Three Months Ended
March 31,
|
|
|
2018
|
2017
|
|
|
|
Dividend
yield
|
—
|
—
|
Volatility
|
64
%
|
61
%
|
Risk-free
interest rate
|
2.4
%
|
1.8
%
|
Expected
life (years)
|
4.5
|
4.4
|
|
|
March 31, 2018
|
December 31, 2017
|
||||
Definite-lived
Intangible Asset
|
Estimated
Useful Life
|
Gross
|
Accumulated Amortization
|
Net
|
Gross
|
Accumulated Amortization
|
Net
|
|
|
(in thousands)
|
|||||
Trademarks/trade
names/licenses/domains
|
3
– 7 years
|
$
16,589
|
$
(4,602
)
|
$
11,987
|
$
16,589
|
$
(4,037
)
|
$
12,552
|
Software
and publications
|
3
years
|
1,300
|
(1,300
)
|
—
|
1,300
|
(1,300
)
|
—
|
Customer
relationships
|
2 -
10 years
|
19,563
|
(11,331
)
|
8,232
|
19,563
|
(10,555
)
|
9,008
|
Employment/non-compete
agreements
|
1-5
years
|
1,510
|
(1,499
)
|
11
|
1,510
|
(1,493
)
|
17
|
Developed
technology
|
5-7
years
|
8,955
|
(3,959
)
|
4,996
|
8,955
|
(3,619
)
|
5,336
|
|
$
47,917
|
$
(22,691
)
|
$
25,226
|
$
47,917
|
$
(21,004
)
|
$
26,913
|
|
|
March 31, 2018
|
December 31, 2017
|
||||
Indefinite-lived
Intangible Asset
|
Estimated
Useful Life
|
Gross
|
Accumulated Amortization
|
Net
|
Gross
|
Accumulated Amortization
|
Net
|
Domain
|
Indefinite
|
$
2,200
|
$
—
|
$
2,200
|
$
2,200
|
$
—
|
$
2,200
|
Year
|
Amortization Expense
|
|
(in thousands)
|
2018
|
$
4,918
|
2019
|
5,236
|
2020
|
3,805
|
2021
|
3,697
|
2022
|
3,100
|
Thereafter
|
4,470
|
|
$
25,226
|
|
(in thousands)
|
Goodwill
as of December 31, 2017
|
$
5,133
|
Impairment
charge
|
(5,133
)
|
Goodwill
as of March 31, 2018
|
$
—
|
|
March 31,
2018
|
December 31,
2017
|
|
(in thousands)
|
|
Accrued
employee-related benefits
|
$
1,925
|
$
2,411
|
Other
accrued expenses and other current liabilities:
|
|
|
Other
accrued expenses
|
6,563
|
6,307
|
Amounts
due to customers
|
452
|
438
|
Other
current liabilities
|
458
|
507
|
Total
other accrued expenses and other current liabilities
|
7,473
|
7,252
|
|
|
|
Total
accrued expenses and other current liabilities
|
$
9,398
|
$
9,663
|
|
2018
|
% of total revenues
|
2017
|
% of total revenues
|
$ Change
|
% Change
|
|
(Dollar amounts in thousands)
|
|
||||
Revenues:
|
|
|
|
|
|
|
Lead
fees
|
$
24,080
|
74
%
|
$
29,092
|
78
%
|
$
(5,012
)
|
(17
%)
|
Advertising
|
8,087
|
25
|
7,969
|
21
|
118
|
1
|
Other
revenues
|
182
|
1
|
280
|
1
|
(98
)
|
(35
)
|
Total
revenues
|
32,349
|
100
|
37,341
|
100
|
(4,992
)
|
(13
)
|
Cost
of revenues
|
24,659
|
76
|
24,430
|
66
|
229
|
1
|
Gross
profit
|
7,690
|
24
|
12,911
|
34
|
(5,221
)
|
(40
)
|
Operating
expenses:
|
|
|
|
|
|
|
Sales
and marketing
|
3,712
|
12
|
3,763
|
10
|
(51
)
|
(1
)
|
Technology
support
|
3,385
|
10
|
3,253
|
9
|
132
|
4
|
General
and administrative
|
4,575
|
14
|
3,457
|
9
|
1,118
|
32
|
Depreciation
and amortization
|
1,160
|
4
|
1,229
|
3
|
(69
)
|
(6
)
|
Goodwill
impairment
|
5,133
|
16
|
—
|
—
|
5,133
|
100
|
Total
operating expenses
|
17,965
|
56
|
11,702
|
31
|
6,263
|
54
|
Operating
income (loss)
|
(10,275
)
|
(32
)
|
1,209
|
3
|
(11,484)
|
(950
)
|
Interest
and other income (expense), net
|
—
|
—
|
(100
)
|
—
|
100
|
(100
)
|
Income
(loss) before income tax provision
|
(10,275
)
|
(32
)
|
1,109
|
3
|
(11,384
)
|
(1,027
)
|
Income
tax provision
|
4
|
—
|
625
|
2
|
(621
)
|
(99
)
|
Net
income (loss)
|
$
(10,279
)
|
(32
%)
|
$
484
|
1
%
|
$
(10,763
)
|
(2,224
%)
|
|
Three Months Ended
March 31,
|
|
|
2018
|
2017
|
|
(in thousands)
|
|
Net
cash (used in) provided by operating activities
|
$
(1,657
)
|
$
3,462
|
Net
cash used in investing activities
|
(250
)
|
(163
)
|
Net
cash used in financing activities
|
(7,927
)
|
(2,168
)
|
2.1
‡
|
Asset
Purchase and Sale Agreement dated as of December 19, 2016 by and
among AutoWeb, Inc. (formerly Autobytel Inc.), Car.com, Inc., a
Delaware corporation, and Internet Brands, Inc., a Delaware
corporation, incorporated by reference to Exhibit 2.1 to the
Current Report on Form 8-K filed with the SEC on December 21, 2016
(SEC File No. 001-34761)
|
|
|
Sixth
Restated Certificate of Incorporation of AutoWeb, Inc. (filed with
the Secretary of the State of Delaware on October 9, 2017),
incorporated by reference to Exhibit 3.4 to the Current Report on
Form 8-K filed with the SEC on October 10, 2017 (SEC File No.
001-34761)
(“
October 2017 Form
8-K
”)
|
|
|
|
Seventh Amended and Restated Bylaws of AutoWeb dated October 9,
2017, incorporated by reference to Exhibit 3.5 to the October 2017
Form 8-K
|
|
|
|
4.1
|
Tax Benefit Preservation Plan dated as of May 26, 2010 between
Company and Computershare Trust Company, N.A., as rights agent,
together with the following exhibits thereto: Exhibit A –
Form of Right Certificate; and Exhibit B – Summary of Rights
to Purchase Shares of Preferred Stock of Company, incorporated by
reference to
Exhibit 4.1
to the Current Report
on Form 8-K filed with the SEC on June 2, 2010 (SEC File No.
000-22239), Amendment No. 1 to Tax Benefit Preservation Plan dated
as of April 14, 2014, between Company and Computershare Trust
Company, N.A., as rights agent, incorporated by reference to
Exhibit 4.1
to the Current Report on Form 8-K filed with the
SEC on April 16, 2014 (SEC File No. 001-34761), Amendment No. 2 to
Tax Benefit Preservation Plan dated as of April 13, 2017, between
Company and Computershare Trust Company, N.A., as rights agent,
incorporated by reference to
Exhibit 4.1
to the Current Report
on Form 8-K filed with the SEC on April 14, 2017 (SEC File No.
001-34761)
|
|
|
Certificate of Adjustment Under Section 11(m) of the Tax Benefit
Preservation Plan, incorporated by reference to Exhibit 4.3 to the
Quarterly Report on Form 10-Q for the quarterly period ended
September 30, 2012 filed with the SEC on November 8, 2012 (SEC File
No. 001-34761)
|
|
|
|
10.1
■
|
Employment Agreement dated as of April 12, 2018 between Company and
Jared R. Rowe, incorporated by reference to Exhibit 10.1 to the
Current Report on Form 8-K filed with the SEC on April 18, 2018
(SEC File No. 001-34761) (“
April 2018 Form
8-K
”)
|
|
|
10.2
■
|
Inducement Stock Option Award Agreement dated as of April 12, 2018
between Company and Jared R. Rowe, incorporated by reference to
Exhibit 10.2 to the April 2018 Form 8-K
|
|
|
10.3
■
|
Consulting Services Agreement dated as of April 12, 2018 between
Company and Jeffrey H. Coats, incorporated by reference to Exhibit
10.3 to the April 2018 Form 8-K
|
|
|
10.4
■*
|
Second Amended and Restated Severance Benefits Agreement dated as
of April 12, 2018 between Company and Glenn E. Fuller
|
|
|
31.1
*
|
Rule 13a-14(a)/15d-14(a) Certification by Principal Executive
Officer
|
|
|
31.2
*
|
Rule 13a-14(a)/15d-14(a) Certification by Principal Financial
Officer
|
|
|
32.1
*
|
Section 1350 Certification by Principal Executive Officer and
Principal Financial Officer
|
|
|
101.INS††
|
XBRL Instance Document
|
|
|
101.SCH††
|
XBRL Taxonomy Extension Schema Document
|
|
|
101.CAL††
|
XBRL Taxonomy Calculation Linkbase Document
|
|
|
101.DEF††
|
XBRL Taxonomy Extension Definition Document
|
|
|
101.LAB††
|
XBRL Taxonomy Label Linkbase Document
|
|
|
101.PRE††
|
XBRL Taxonomy Presentation Linkbase Document
|
|
|
AutoWeb,
Inc.
|
|
|
|
|
|
|
Date: May 10, 2018
|
By:
|
/s/ Wesley Ozima
|
|
|
|
Wesley Ozima
|
|
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Senior Vice President and Controller, and Interim Chief Financial
Officer
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(Principal Accounting Officer)
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Dated:_____________,
20__
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_____________________________________
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Glenn E.
Fuller
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Dated:_____________, 20__
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AutoWeb
Inc.
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By:
__________________________________
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(Officer
Name)
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(Title)
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/s/ Jared R. Rowe
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Jared R. Rowe
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President and Chief Executive Officer
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/s/ Wesley Ozima
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Wesley Ozima
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Senior Vice President and Controller, and Interim
Chief Financial Officer
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/s/ Jared R. Rowe
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Jared R. Rowe
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President and Chief Executive Officer
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May 10, 2018
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/s/ Wesley Ozima
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Wesley Ozima
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Senior Vice President and Controller, and
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Interim Chief Financial Officer
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May 10, 2018
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