| Guarantor and Non-Guarantor Financial Statements |
Guarantor and Non-Guarantor Financial Statements
On September 28, 2016, the Company sold to the Initial Purchaser, $16,000 principal amount of 8.75% convertible notes maturing on September 23, 2020, unless converted, repurchased or redeemed in accordance with their terms prior to such date. The Notes were issued under the Indenture, as amended and supplemented to date, between Digital Turbine, Inc., US Bank National Association, as trustee, and certain wholly-owned subsidiaries of the Company, specifically, DT USA, DT Media, DT EMEA, and DT APAC. Given the Notes are unconditionally guaranteed as to the payment of principal, premium, if any, and interest on a senior unsecured basis by four of the wholly-owned subsidiaries of the Company, the Company is required by SEC Reg S-X 210.3-10 to include, in a footnote, consolidating financial information for the same periods with a separate column for:
|
|
• |
The subsidiary guarantors on a combined basis; |
|
|
• |
Any other subsidiaries of the parent company on a combined basis; |
|
|
• |
Consolidating adjustments; and |
|
|
• |
The total consolidated amounts. |
The following consolidated financial information includes:
(1) Consolidated balance sheets as of June 30, 2018 and March 31, 2018; consolidated statements of operations for the three months ended June 30, 2018 and 2017; and consolidated statements of cash flows for the three months ended June 30, 2018 and 2017 of (a) Digital Turbine, Inc. as the parent, (b) the guarantor subsidiaries, (c) the non-guarantor subsidiaries, and (d) Digital Turbine, Inc. on a consolidated basis; and
(2) Elimination entries necessary to consolidate Digital Turbine, Inc., as the parent, with its guarantor and non-guarantor subsidiaries.
Digital Turbine, Inc. owns 100% of all of the guarantor subsidiaries, and as a result, in accordance with Rule 3-10(d) of Regulation S-X promulgated by the SEC, no separate financial statements are required for these subsidiaries as of and for the three months ended June 30, 2018 or 2017.
Consolidated Balance Sheet
as of June 30, 2018 (Unaudited)
(in thousands, except par value and share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent |
|
Guarantor Subsidiaries |
|
Non-Guarantor Subsidiaries |
|
Consolidated Total |
ASSETS |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash |
|
$ |
946 |
|
|
$ |
7,612 |
|
|
$ |
80 |
|
|
$ |
8,638 |
|
Restricted cash |
|
156 |
|
|
175 |
|
|
— |
|
|
331 |
|
Accounts receivable, net of allowance of $790 |
|
— |
|
|
19,102 |
|
|
244 |
|
|
19,346 |
|
Deposits |
|
34 |
|
|
113 |
|
|
4 |
|
|
151 |
|
Prepaid expenses and other current assets |
|
349 |
|
|
443 |
|
|
10 |
|
|
802 |
|
Current assets held for disposal |
|
— |
|
|
4,053 |
|
|
340 |
|
|
4,393 |
|
Total current assets |
|
1,485 |
|
|
31,498 |
|
|
678 |
|
|
33,661 |
|
Property and equipment, net |
|
267 |
|
|
2,435 |
|
|
9 |
|
|
2,711 |
|
Deferred tax assets |
|
632 |
|
|
— |
|
|
— |
|
|
632 |
|
Intangible assets, net |
|
1 |
|
|
895 |
|
|
— |
|
|
896 |
|
Goodwill |
|
1,065 |
|
|
40,201 |
|
|
1,002 |
|
|
42,268 |
|
Long-term assets held for disposal |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
TOTAL ASSETS |
|
$ |
3,450 |
|
|
$ |
75,029 |
|
|
$ |
1,689 |
|
|
$ |
80,168 |
|
INTERCOMPANY |
|
|
|
|
|
|
|
|
Intercompany payable / (receivable), net |
|
114,746 |
|
|
(98,385 |
) |
|
(16,361 |
) |
|
— |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
1,015 |
|
|
$ |
17,285 |
|
|
$ |
(8 |
) |
|
$ |
18,292 |
|
Accrued license fees and revenue share |
|
— |
|
|
11,169 |
|
|
322 |
|
|
11,491 |
|
Accrued compensation |
|
489 |
|
|
688 |
|
|
— |
|
|
1,177 |
|
Short-term debt, net of debt issuance costs and discounts of $163 |
|
1,437 |
|
|
— |
|
|
— |
|
|
1,437 |
|
Other current liabilities |
|
1,138 |
|
|
(163 |
) |
|
511 |
|
|
1,486 |
|
Current liabilities held for disposal |
|
— |
|
|
7,610 |
|
|
438 |
|
|
8,048 |
|
Total current liabilities |
|
4,079 |
|
|
36,589 |
|
|
1,263 |
|
|
41,931 |
|
Convertible notes, net of debt issuance costs and discounts of $1,709 |
|
3,991 |
|
|
— |
|
|
— |
|
|
3,991 |
|
Convertible note embedded derivative liability |
|
3,056 |
|
|
— |
|
|
— |
|
|
3,056 |
|
Warrant liability |
|
2,410 |
|
|
— |
|
|
— |
|
|
2,410 |
|
Total liabilities |
|
13,536 |
|
|
36,589 |
|
|
1,263 |
|
|
51,388 |
|
Stockholders' equity |
|
|
|
|
|
|
|
|
Preferred stock |
|
|
|
|
|
|
|
|
Series A convertible preferred stock at $0.0001 par value; 2,000,000 shares authorized, 100,000 issued and outstanding (liquidation preference of $1,000) |
|
100 |
|
|
— |
|
|
— |
|
|
100 |
|
Common stock |
|
|
|
|
|
|
|
|
$0.0001 par value: 200,000,000 shares authorized; 77,145,980 issued and 76,391,381 outstanding at June 30, 2018. |
|
10 |
|
|
— |
|
|
— |
|
|
10 |
|
Additional paid-in capital |
|
318,690 |
|
|
— |
|
|
— |
|
|
318,690 |
|
Treasury stock (754,599 shares at June 30, 2018) |
|
(71 |
) |
|
— |
|
|
— |
|
|
(71 |
) |
Accumulated other comprehensive loss |
|
30 |
|
|
(1,491 |
) |
|
1,136 |
|
|
(325 |
) |
Accumulated deficit |
|
(214,099 |
) |
|
(58,454 |
) |
|
(17,071 |
) |
|
(289,624 |
) |
Total stockholders' equity |
|
104,660 |
|
|
(59,945 |
) |
|
(15,935 |
) |
|
28,780 |
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
118,196 |
|
|
$ |
(23,356 |
) |
|
$ |
(14,672 |
) |
|
$ |
80,168 |
|
Consolidated Balance Sheet
as of March 31, 2018 (Unaudited)
(in thousands, except par value and share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent |
|
Guarantor Subsidiaries |
|
Non-Guarantor Subsidiaries |
|
Consolidated Total |
ASSETS |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash |
|
$ |
501 |
|
|
$ |
11,800 |
|
|
$ |
419 |
|
|
$ |
12,720 |
|
Restricted cash |
|
156 |
|
|
175 |
|
|
— |
|
|
331 |
|
Accounts receivable, net of allowance of $512 |
|
— |
|
|
16,777 |
|
|
273 |
|
|
17,050 |
|
Deposits |
|
34 |
|
|
113 |
|
|
4 |
|
|
151 |
|
Prepaid expenses and other current assets |
|
330 |
|
|
406 |
|
|
14 |
|
|
750 |
|
Current assets held for disposal |
|
— |
|
|
8,610 |
|
|
143 |
|
|
8,753 |
|
Total current assets |
|
1,021 |
|
|
37,881 |
|
|
853 |
|
|
39,755 |
|
Property and equipment, net |
|
257 |
|
|
2,485 |
|
|
15 |
|
|
2,757 |
|
Deferred tax assets |
|
596 |
|
|
— |
|
|
— |
|
|
596 |
|
Intangible assets, net |
|
— |
|
|
1,231 |
|
|
— |
|
|
1,231 |
|
Goodwill |
|
— |
|
|
41,268 |
|
|
1,000 |
|
|
42,268 |
|
TOTAL ASSETS |
|
$ |
1,874 |
|
|
$ |
82,865 |
|
|
$ |
1,868 |
|
|
$ |
86,607 |
|
INTERCOMPANY |
|
|
|
|
|
|
|
|
Intercompany payable / (receivable), net |
|
117,873 |
|
|
(114,234 |
) |
|
(3,639 |
) |
|
— |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
1,031 |
|
|
$ |
18,841 |
|
|
$ |
23 |
|
|
$ |
19,895 |
|
Accrued license fees and revenue share |
|
— |
|
|
7,989 |
|
|
243 |
|
|
8,232 |
|
Accrued compensation |
|
2,285 |
|
|
661 |
|
|
20 |
|
|
2,966 |
|
Short-term debt, net of debt issuance costs and discounts of $205 |
|
1,445 |
|
|
— |
|
|
— |
|
|
1,445 |
|
Other current liabilities |
|
911 |
|
|
231 |
|
|
— |
|
|
1,142 |
|
Current liabilities held for disposal |
|
— |
|
|
12,246 |
|
|
480 |
|
|
12,726 |
|
Total current liabilities |
|
5,672 |
|
|
39,968 |
|
|
766 |
|
|
46,406 |
|
Convertible notes, net of debt issuance costs and discounts of $1,827 |
|
3,873 |
|
|
— |
|
|
— |
|
|
3,873 |
|
Convertible note embedded derivative liability |
|
3,218 |
|
|
— |
|
|
— |
|
|
3,218 |
|
Warrant liability |
|
1,076 |
|
|
— |
|
|
— |
|
|
1,076 |
|
Total liabilities |
|
18,201 |
|
|
39,968 |
|
|
766 |
|
|
58,935 |
|
Stockholders' equity |
|
|
|
|
|
|
|
|
Preferred stock |
|
|
|
|
|
|
|
|
Series A convertible preferred stock at $0.0001 par value; 2,000,000 shares authorized, 100,000 issued and outstanding (liquidation preference of $1,000) |
|
100 |
|
|
— |
|
|
— |
|
|
100 |
|
Common stock |
|
|
|
|
|
|
|
|
$0.0001 par value: 200,000,000 shares authorized; 76,843,278 issued and 76,108,822 outstanding at March 31, 2018 |
|
10 |
|
|
— |
|
|
— |
|
|
10 |
|
Additional paid-in capital |
|
318,066 |
|
|
— |
|
|
— |
|
|
318,066 |
|
Treasury stock (754,599 shares at March 31, 2018) |
|
(71 |
) |
|
— |
|
|
— |
|
|
(71 |
) |
Accumulated other comprehensive loss |
|
(15 |
) |
|
(621 |
) |
|
311 |
|
|
(325 |
) |
Accumulated deficit |
|
(216,544 |
) |
|
(70,716 |
) |
|
(2,848 |
) |
|
(290,108 |
) |
Total stockholders' equity |
|
101,546 |
|
|
(71,337 |
) |
|
(2,537 |
) |
|
27,672 |
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
119,747 |
|
|
$ |
(31,369 |
) |
|
$ |
(1,771 |
) |
|
$ |
86,607 |
|
Consolidated Statement of Operations and Comprehensive Loss
for the three months ended June 30, 2018 (Unaudited)
(in thousands, except par value and share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent |
|
Guarantor Subsidiaries |
|
Non-Guarantor Subsidiaries |
|
Elimination |
|
Consolidated Total |
Net revenues |
|
$ |
— |
|
|
$ |
40,927 |
|
|
$ |
204 |
|
|
$ |
(19,019 |
) |
|
$ |
22,112 |
|
Cost of revenues |
|
|
|
|
|
|
|
|
|
|
License fees and revenue share |
|
— |
|
|
34,145 |
|
|
90 |
|
|
(19,019 |
) |
|
15,216 |
|
Other direct cost of revenues |
|
— |
|
|
507 |
|
|
— |
|
|
— |
|
|
507 |
|
Total cost of revenues |
|
— |
|
|
34,652 |
|
|
90 |
|
|
(19,019 |
) |
|
15,723 |
|
Gross profit |
|
— |
|
|
6,275 |
|
|
114 |
|
|
— |
|
|
6,389 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
Product development |
|
90 |
|
|
2,904 |
|
|
115 |
|
|
— |
|
|
3,109 |
|
Sales and marketing |
|
124 |
|
|
1,508 |
|
|
204 |
|
|
— |
|
|
1,836 |
|
General and administrative |
|
1,162 |
|
|
1,490 |
|
|
52 |
|
|
— |
|
|
2,704 |
|
Total operating expenses |
|
1,376 |
|
|
5,902 |
|
|
371 |
|
|
— |
|
|
7,649 |
|
Income / (loss) from operations |
|
(1,376 |
) |
|
373 |
|
|
(257 |
) |
|
— |
|
|
(1,260 |
) |
Interest and other income / (expense), net |
|
|
|
|
|
|
|
|
|
|
Interest income / (expense) |
|
(320 |
) |
|
1 |
|
|
— |
|
|
— |
|
|
(319 |
) |
Foreign exchange transaction gain / (loss) |
|
— |
|
|
10 |
|
|
(2 |
) |
|
— |
|
|
8 |
|
Change in fair value of convertible note embedded derivative liability |
|
1,620 |
|
|
— |
|
|
— |
|
|
— |
|
|
1,620 |
|
Change in fair value of warrant liability |
|
1,570 |
|
|
— |
|
|
— |
|
|
— |
|
|
1,570 |
|
Other income / (expense) |
|
894 |
|
|
(1,016 |
) |
|
(5 |
) |
|
— |
|
|
(127 |
) |
Total interest and other income / (expense), net |
|
3,764 |
|
|
(1,005 |
) |
|
(7 |
) |
|
— |
|
|
2,752 |
|
Income / (loss) from operations before income taxes |
|
2,388 |
|
|
(632 |
) |
|
(264 |
) |
|
— |
|
|
1,492 |
|
Income tax benefit |
|
(36 |
) |
|
— |
|
|
— |
|
|
— |
|
|
(36 |
) |
Net income / (loss) from continuing operations, net of taxes |
|
2,424 |
|
|
(632 |
) |
|
(264 |
) |
|
— |
|
|
1,528 |
|
|
|
|
|
|
|
|
|
|
|
|
Income / (loss) from operations of discontinued components |
|
(37 |
) |
|
(1,016 |
) |
|
9 |
|
|
— |
|
|
(1,044 |
) |
Net loss from discontinued operations, net of taxes |
|
(37 |
) |
|
(1,016 |
) |
|
9 |
|
|
— |
|
|
(1,044 |
) |
Net income / (loss) |
|
$ |
2,387 |
|
|
$ |
(1,648 |
) |
|
$ |
(255 |
) |
|
$ |
— |
|
|
$ |
484 |
|
Comprehensive income / (loss) |
|
$ |
2,387 |
|
|
$ |
(1,648 |
) |
|
$ |
(255 |
) |
|
$ |
— |
|
|
$ |
484 |
|
Consolidated Statement of Operations and Comprehensive Loss
for the three months ended June 30, 2017 (Unaudited)
(in thousands, except par value and share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent |
|
Guarantor Subsidiaries |
|
Non-Guarantor Subsidiaries |
|
Elimination |
|
Consolidated Total |
Net revenues |
|
$ |
— |
|
|
$ |
27,067 |
|
|
$ |
250 |
|
|
$ |
(12,164 |
) |
|
$ |
15,153 |
|
Cost of revenues |
|
|
|
|
|
|
|
|
|
|
License fees and revenue share |
|
— |
|
|
21,721 |
|
|
35 |
|
|
(12,164 |
) |
|
9,592 |
|
Other direct cost of revenues |
|
— |
|
|
195 |
|
|
214 |
|
|
— |
|
|
409 |
|
Total cost of revenues |
|
— |
|
|
21,916 |
|
|
249 |
|
|
(12,164 |
) |
|
10,001 |
|
Gross profit |
|
— |
|
|
5,151 |
|
|
1 |
|
|
— |
|
|
5,152 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
Product development |
|
5 |
|
|
2,157 |
|
|
12 |
|
|
— |
|
|
2,174 |
|
Sales and marketing |
|
102 |
|
|
982 |
|
|
53 |
|
|
— |
|
|
1,137 |
|
General and administrative |
|
2,252 |
|
|
1,032 |
|
|
74 |
|
|
— |
|
|
3,358 |
|
Total operating expenses |
|
2,359 |
|
|
4,171 |
|
|
139 |
|
|
— |
|
|
6,669 |
|
Income / (loss) from operations |
|
(2,359 |
) |
|
980 |
|
|
(138 |
) |
|
— |
|
|
(1,517 |
) |
Interest and other income / (expense), net |
|
|
|
|
|
|
|
|
|
|
Interest income / (expense) |
|
(710 |
) |
|
3 |
|
|
— |
|
|
— |
|
|
(707 |
) |
Foreign exchange transaction loss |
|
— |
|
|
(63 |
) |
|
— |
|
|
— |
|
|
(63 |
) |
Change in fair value of convertible note embedded derivative liability |
|
(1,308 |
) |
|
— |
|
|
— |
|
|
— |
|
|
(1,308 |
) |
Change in fair value of warrant liability |
|
(464 |
) |
|
— |
|
|
— |
|
|
— |
|
|
(464 |
) |
Other income |
|
3 |
|
|
— |
|
|
— |
|
|
— |
|
|
3 |
|
Total interest and other income / (expense), net |
|
(2,479 |
) |
|
(60 |
) |
|
— |
|
|
— |
|
|
(2,539 |
) |
Income / (loss) from continuing operations before income taxes |
|
(4,838 |
) |
|
920 |
|
|
(138 |
) |
|
— |
|
|
(4,056 |
) |
Income tax provision |
|
31 |
|
|
— |
|
|
— |
|
|
— |
|
|
31 |
|
Net income / (loss) from continuing operations, net of taxes |
|
(4,869 |
) |
|
920 |
|
|
(138 |
) |
|
— |
|
|
(4,087 |
) |
|
|
|
|
|
|
|
|
|
|
|
Loss from operations of discontinued components |
|
— |
|
|
(44 |
) |
|
(44 |
) |
|
— |
|
|
(88 |
) |
Net loss from discontinued operations, net of taxes |
|
— |
|
|
(44 |
) |
|
(44 |
) |
|
— |
|
|
(88 |
) |
Net income / (loss) |
|
$ |
(4,869 |
) |
|
$ |
876 |
|
|
$ |
(182 |
) |
|
$ |
— |
|
|
$ |
(4,175 |
) |
Other comprehensive income / (loss) |
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustment |
|
— |
|
|
(216 |
) |
|
216 |
|
|
— |
|
|
— |
|
Comprehensive income / (loss) |
|
$ |
(4,869 |
) |
|
$ |
660 |
|
|
$ |
34 |
|
|
$ |
— |
|
|
$ |
(4,175 |
) |
Consolidated Statement of Cash Flows
for the three months ended June 30, 2018 (Unaudited)
(in thousands, except par value and share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent |
|
Guarantor Subsidiaries |
|
Non-Guarantor Subsidiaries |
|
Consolidated Total |
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Net income / (loss) |
|
$ |
2,424 |
|
|
$ |
(632 |
) |
|
$ |
(264 |
) |
|
$ |
1,528 |
|
Adjustments to reconcile net income / (loss) to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
8 |
|
|
719 |
|
|
2 |
|
|
729 |
|
Change in allowance for doubtful accounts |
|
— |
|
|
238 |
|
|
40 |
|
|
278 |
|
Amortization of debt discount and debt issuance costs |
|
161 |
|
|
— |
|
|
— |
|
|
161 |
|
Stock-based compensation |
|
463 |
|
|
— |
|
|
— |
|
|
463 |
|
Stock-based compensation for services rendered
|
|
85 |
|
|
— |
|
|
— |
|
|
85 |
|
Change in fair value of convertible note embedded derivative liability |
|
(1,620 |
) |
|
— |
|
|
— |
|
|
(1,620 |
) |
Change in fair value of warrant liability |
|
(1,570 |
) |
|
— |
|
|
— |
|
|
(1,570 |
) |
(Increase) / decrease in assets: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
— |
|
|
(2,735 |
) |
|
161 |
|
|
(2,574 |
) |
Deferred tax assets |
|
(36 |
) |
|
— |
|
|
— |
|
|
(36 |
) |
Prepaid expenses and other current assets |
|
(19 |
) |
|
43 |
|
|
(76 |
) |
|
(52 |
) |
Increase / (decrease) in liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
(15 |
) |
|
(1,557 |
) |
|
(31 |
) |
|
(1,603 |
) |
Accrued license fees and revenue share |
|
— |
|
|
3,180 |
|
|
79 |
|
|
3,259 |
|
Accrued compensation |
|
(1,784 |
) |
|
34 |
|
|
(31 |
) |
|
(1,781 |
) |
Accrued interest |
|
135 |
|
|
— |
|
|
— |
|
|
135 |
|
Other current liabilities |
|
3,237 |
|
|
(3,114 |
) |
|
86 |
|
|
209 |
|
Other non-current liabilities |
|
— |
|
|
(6 |
) |
|
— |
|
|
(6 |
) |
Cash provided by / (used in) operating activities - continuing operations |
|
1,469 |
|
|
(3,830 |
) |
|
(34 |
) |
|
(2,395 |
) |
Cash used in operating activities - discontinued operations |
|
— |
|
|
(903 |
) |
|
(321 |
) |
|
(1,224 |
) |
Net cash provided by / (used in) operating activities |
|
1,469 |
|
|
(4,733 |
) |
|
(355 |
) |
|
(3,619 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
Capital expenditures |
|
(1,013 |
) |
|
586 |
|
|
16 |
|
|
(411 |
) |
Cash provided by / (used in) investing activities - continuing operations |
|
(1,013 |
) |
|
586 |
|
|
16 |
|
|
(411 |
) |
Cash used in investing activities - discontinued operations |
|
— |
|
|
(41 |
) |
|
— |
|
|
(41 |
) |
Net cash provided by / (used in) investing activities |
|
(1,013 |
) |
|
545 |
|
|
16 |
|
|
(452 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
Options exercised |
|
39 |
|
|
— |
|
|
— |
|
|
39 |
|
Repayment of debt obligations |
|
(50 |
) |
|
— |
|
|
— |
|
|
(50 |
) |
Net cash used in financing activities |
|
(11 |
) |
|
— |
|
|
— |
|
|
(11 |
) |
|
|
|
|
|
|
|
|
|
Net change in cash |
|
445 |
|
|
(4,188 |
) |
|
(339 |
) |
|
(4,082 |
) |
|
|
|
|
|
|
|
|
|
Cash and restricted cash, beginning of period |
|
657 |
|
|
11,975 |
|
|
419 |
|
|
13,051 |
|
|
|
|
|
|
|
|
|
|
Cash and restricted cash, end of period |
|
$ |
1,102 |
|
|
$ |
7,787 |
|
|
$ |
80 |
|
|
$ |
8,969 |
|
Consolidated Statement of Cash Flows
for the three months ended June 30, 2017 (Unaudited)
(in thousands, except par value and share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent |
|
Guarantor Subsidiaries |
|
Non-Guarantor Subsidiaries |
|
Consolidated Total |
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Net income / (loss) |
|
$ |
(4,869 |
) |
|
$ |
920 |
|
|
$ |
(138 |
) |
|
$ |
(4,087 |
) |
Adjustments to reconcile net income / (loss) to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
34 |
|
|
418 |
|
|
176 |
|
|
628 |
|
Change in allowance for doubtful accounts |
|
— |
|
|
146 |
|
|
— |
|
|
146 |
|
Amortization of debt discount and debt issuance costs |
|
353 |
|
|
— |
|
|
— |
|
|
353 |
|
Stock-based compensation |
|
715 |
|
|
— |
|
|
— |
|
|
715 |
|
Stock-based compensation for services rendered
|
|
76 |
|
|
— |
|
|
— |
|
|
76 |
|
Change in fair value of convertible note embedded derivative liability |
|
1,308 |
|
|
— |
|
|
— |
|
|
1,308 |
|
Change in fair value of warrant liability |
|
464 |
|
|
— |
|
|
— |
|
|
464 |
|
(Increase) / decrease in assets: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
— |
|
|
(2,939 |
) |
|
(180 |
) |
|
(3,119 |
) |
Prepaid expenses and other current assets |
|
(52 |
) |
|
(18 |
) |
|
(2 |
) |
|
(72 |
) |
Increase / (decrease) in liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
236 |
|
|
(1,117 |
) |
|
(26 |
) |
|
(907 |
) |
Accrued license fees and revenue share |
|
— |
|
|
2,857 |
|
|
48 |
|
|
2,905 |
|
Accrued compensation |
|
— |
|
|
98 |
|
|
— |
|
|
98 |
|
Accrued interest |
|
344 |
|
|
— |
|
|
— |
|
|
344 |
|
Other current liabilities |
|
110 |
|
|
(643 |
) |
|
— |
|
|
(533 |
) |
Other non-current liabilities |
|
67 |
|
|
6 |
|
|
— |
|
|
73 |
|
Intercompany movement of cash |
|
(729 |
) |
|
1,061 |
|
|
(332 |
) |
|
— |
|
Cash provided by / (used in) operating activities - continuing operations |
|
(1,943 |
) |
|
789 |
|
|
(454 |
) |
|
(1,608 |
) |
Cash provided by / (used in) operating activities - discontinued operations |
|
— |
|
|
222 |
|
|
(18 |
) |
|
204 |
|
Net cash provided by / (used in) operating activities |
|
(1,943 |
) |
|
1,011 |
|
|
(472 |
) |
|
(1,404 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
Capital expenditures |
|
— |
|
|
(365 |
) |
|
— |
|
|
(365 |
) |
Cash provided by / (used in) investing activities - continuing operations |
|
|
|
(365 |
) |
|
— |
|
|
(365 |
) |
Cash provided by / (used in) investing activities - discontinued operations |
|
|
|
(9 |
) |
|
|
|
(9 |
) |
Net cash used in investing activities |
|
— |
|
|
(374 |
) |
|
— |
|
|
(374 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
Proceeds from short-term borrowings |
|
2,250 |
|
|
— |
|
|
— |
|
|
2,250 |
|
Payment of debt issuance costs |
|
(320 |
) |
|
— |
|
|
— |
|
|
(320 |
) |
Options exercised |
|
9 |
|
|
— |
|
|
— |
|
|
9 |
|
Net cash provided by financing activities |
|
1,939 |
|
|
— |
|
|
— |
|
|
1,939 |
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash |
|
— |
|
|
(8 |
) |
|
— |
|
|
(8 |
) |
|
|
|
|
|
|
|
|
|
Net change in cash |
|
(4 |
) |
|
629 |
|
|
(472 |
) |
|
153 |
|
|
|
|
|
|
|
|
|
|
Cash and restricted cash, beginning of period |
|
413 |
|
|
5,510 |
|
|
557 |
|
|
6,480 |
|
|
|
|
|
|
|
|
|
|
Cash and restricted cash, end of period |
|
$ |
409 |
|
|
$ |
6,139 |
|
|
$ |
85 |
|
|
$ |
6,633 |
|
|