As filed with the Securities and Exchange Commission on August 14, 2015December 16, 2016

Registration No. 333-

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM S-3

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

IDI,COGINT, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware7310 77-0688094

(State or other jurisdiction of

incorporation or organization)

 

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification No.)

2650 North Military Trail, Suite 300

Boca Raton, Florida 33431

(561) 757-4000

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

 

 

Joshua B. Weingard, Esq.

2650 North Military Trail, Suite 300

Boca Raton, Florida 33431

(561) 757-4000

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

 

Copies to:

Michael D. Harris,Francis, Esq.

Leah E. Hutton, Esq.Akerman LLP

Nason, Yeager, Gerson, White & Lioce, P.A.Las Olas Centre II, Suite 1600

1645 Palm Beach Lakes Blvd., Suite 1200350 East Las Olas Boulevard

West Palm Beach,Fort Lauderdale, Florida 3340133301

(561) 686-3307(954) 463-2700

 

 

Approximate date of commencement of proposed sale to the public:public: From time to time after the effective date of this registration statement.

If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, please check the following box.  ¨

If any of the Securitiessecurities being registered on this Formform are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offering only in connection with dividend or interest reinvestment plans, check the following box.  x

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box.  ¨

If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box.  ¨

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 definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

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

 

 

CALCULATION OF REGISTRATION FEE

 

 

Title of securities
to be registered
 

Amount

to be

registered

 

Proposed

maximum

offering price

per share

 Proposed
maximum
aggregate
offering price
 Amount of
registration fee

Common Stock, $0.0005 par value per share

 640,205 $7.62(1) $4,878,362(1) $567

Total

 640,205 $7.62 $4,878,362 $567

 

 

 

Title of securities

to be registered

 

Amount

to be

registered

 

Proposed

maximum

offering price

per share

 

Proposed

maximum

aggregate

offering price

 

Amount of

registration fee

Common Stock, $0.0005 par value per share, underlying outstanding warrants

 $1,000,000 $3.75(1) $3,750,000(1) $435

Common Stock, $0.0005 par value per share, underlying outstanding warrants

 $100,000 $5.00(1) $500,000(1) $58

Common Stock, $0.0005

 $200,000 $3.40(2) $680,000(2) $79

TOTAL

 $1,300,000   $4,930,000 $572

 

 

(1)Calculated solely for the purpose of determining the registration fee pursuant to Rule 457(i) of the Securities Act of 1933, based on the exercise price of the warrants.
(2)Calculated solely for the purpose of determining the registration fee pursuant to Rule 457(c) of the Securities Act of 1933, based on the average of the high and low prices of the registrant’s common stock quoted on the NYSE MKTThe NASDAQ Global Market on August 11, 2015.December 13, 2016.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

 

 


The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission of which this prospectus is a part becomes effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

 

Subject to Completion, Dated August 14, 2015December 16, 2016

PROSPECTUS

IDI, Inc.

640,205LOGO

1,300,000 Shares of Common Stock

 

 

This prospectus relates to (i) the saleissuance of up to 640,2051,100,000 shares of our common stock issuable upon the exercise of warrants which may be offered(the “Warrant Shares”) and the resale of the Warrant Shares by the selling shareholderstockholders identified in this prospectus.prospectus and (ii) the resale of up to 200,000 shares of our common stock issued in a private placement by the Company on December 15, 2016 with the selling stockholder identified in this prospectus (the “Purchased Shares”). We will not receive any proceeds from the sales of shares of our common stock by the selling shareholder named on page 12.stockholders. We will, however, receive $3.75 per share of proceeds in connection withfrom the exercise of warrants to purchase 1,000,000 shares of our common stock and $5.00 per share of proceeds from the exercise of warrants referred to above.purchase 100,000 shares of our common stock.

 

 

The common stock offered in this prospectus involves a high degree of risk. See “Risk Factors” beginning on page 39 of this prospectus to read about factors you should consider before buying shares of our common stock.

No underwriter or other person has been engaged to facilitate the sale of shares of our common stock in this offering. TheEach selling shareholder may be deemed an underwriter of the shares of our common stock that thesuch selling shareholder is offering within the meaning of the Securities Act of 1933. We will bear all costs, expenses and fees in connection with the registration of these shares.

The selling shareholder is offering these shares of common stock. The selling shareholderstockholders may sell all or a portion of these shares from time to time in market transactions through any market on which our common stock is then traded, in negotiated transactions or otherwise, and at prices and on terms that will be determined by the then prevailing market price or at negotiated prices directly or through a broker or brokers, who may act as agent or as principal or by a combination of such methods of sale. The selling shareholderstockholders will receive all proceeds from the sale of the common stock.shares. We will receive proceeds from the exercise of the warrants, if the warrants are exercised, which proceeds will be used for working capital and other general corporate purposes. For additional information on the methods of sale, you should refer to the section entitled “Plan of Distribution.”

Our common stock is traded on the NYSE MKTThe NASDAQ Global Market (“NASDAQ”) under the symbol “IDI.“COGT.” On August 13, 2015,December 15, 2016, the last reported sales price of our common stock on the NYSE MKTNASDAQ was $8.07$3.40 per share.

 

 

Investing in our securities involves risks. You should read carefully and consider “Risk Factors” included in our most recent Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission and on page 35 of this prospectus and in the applicable prospectus supplement before investing in our securities.

 

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined whether this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

 

 

The date of this prospectus is                     , 20152016


TABLE OF CONTENTS

 

   Page 

PROSPECTUS SUMMARY

   1  

THE OFFERING

   27  

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

   38  

RISK FACTORS

   39  

USE OF PROCEEDS

   1210  

SELLING SHAREHOLDERSTOCKHOLDERS

   1210  

DESCRIPTION OF CAPITAL STOCK

   13  

CERTAIN PROVISIONS OF DELAWARE LAW AND OF OUR CHARTER AND BYLAWS

13

PLAN OF DISTRIBUTION

   14  

PLAN OF DISTRIBUTIONLEGAL MATTERS

   16  

LEGAL MATTERSEXPERTS

   1817  
EXPERTS18

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

   1817  


You should rely only on information contained in this prospectus. We have not authorized anyone to provide you with information that is different from that contained in this prospectus. We are not offering to sell or seeking offers to buy shares of common stock in jurisdictions where offers and sales are not permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common stock. We are responsible for updating this prospectus to ensure that all material information is included and will update this prospectus to the extent required by law.


PROSPECTUS SUMMARY

This summary only highlights the more detailed information appearing elsewhere in this prospectus or incorporated by reference in this prospectus. It may not contain all of the information that is important to you. You should carefully read the entire prospectus and the documents incorporated by reference in this prospectus before deciding whether to invest in our securities.Unless otherwise indicated or the context requires otherwise, in this prospectus supplement and anythe accompanying prospectus supplement, hereto references to “IDI,“cogint,“the Company,the “Company,” “we,” “us,” and “our” refer to IDI,Cogint, Inc. and its consolidated subsidiaries.

We are not, and the selling shareholder isstockholders are not, making an offer of these securities in any jurisdiction where the offer is not permitted. You should not assume that the information in this prospectus or a prospectus supplement is accurate as of any date other than the date on the front of the document.

Our Company Overview

IDI,Cogint, Inc., formerly known as Tiger Media, Inc. or Tiger Media,a Delaware corporation, is a holdingdata and analytics company incorporatedproviding cloud-based mission-critical information and performance marketing solutions to enterprises in a variety of industries. Our mission is to transform data into intelligence utilizing our proprietary technology platforms to solve complex problems for our clients. Harnessing the Statepower of Delaware.data fusion and powerful analytics, we transform data into intelligence, in a fast and efficient manner, so that our clients can spend their time on what matters most, running their organizations with confidence. Through its consolidated subsidiaries, IDI’s principal focus isour intelligent platforms, CORE™ and Agile Acquisition Engine™, we uncover the relevance of disparate data points to deliver end-to-end, ROI-driven results for our customers. Our analytical capabilities enable us to build comprehensive datasets in data analytics, serving as an informationreal-time and provide insightful views of people, businesses, assets and their interrelationships. We empower clients across markets and industries to better execute all aspects of their business, from managing risk, identifying fraud and abuse, ensuring legislative compliance, and debt recovery, to identifying and acquiring new customers. With the goal of reducing the cost of doing business and enhancing the consumer experience, our solutions providerenable our clients to optimize overall decision-making and to have a holistic view of their customers.

We provide unique and compelling solutions essential to the risk management industry for purposes including due diligence, risk assessment, fraud detection and prevention, and authentication and verification. Further, IDI’s cross-functional core systems and processes are designed to deliver products and solutions to the marketing industry and to enabledaily workflow of organizations within both the public and private sectors. Our cloud-based data fusion and customer acquisition technology platforms, combined with our massive database consisting of public-record, proprietary and publicly-available data, as well as a unique repository of self-reported information on millions of consumers, enables the delivery of differentiated products and solutions used for a variety of essential functions throughout the customer life cycle. These essential functions include customer identification and authentication, investigation and validation, and customer acquisition and retention.

The Company operates through two reportable segments: (i) Information Services and (ii) Performance Marketing.

Information Services—Leveraging leading-edge technology, proprietary algorithms, and massive datasets, and through intuitive and powerful analytical applications, we provide solutions to organizations within the risk management and consumer marketing industries. CORE is our next generation data fusion platform, providing mission-critical information about individuals, businesses and assets to a variety of markets and industries. Information Services uses the power of data fusion to ingest and analyze data at massive scale, machine learning and advanced analytics, and the information derived therefrom to provide solutions for banking and financial services companies, insurance companies, healthcare companies, law enforcement and government, the collection industry, law firms, retail, telecommunications companies, corporate security and investigative firms. In addition, our data acquisition solutions enable clients to rapidly grow their customer databases by using self-declared consumer insights to identify, connect with, and acquire first-party consumer data and multi-channel marketing consent at massive scale.

Built in a secure Payment Card Industry (“PCI”) compliant environment, our cloud-based next generation technology delivers greater than four 9s of service uptime. By leveraging our proprietary infrastructure design


within the cloud, we currently operate in six datacenters spread geographically across the U.S. and are able to dynamically and seamlessly scale as needed. Using our intelligent framework, and leveraging a micro services architecture where appropriate, we reduce operational cost and complexity, thus delivering superior performance at greatly reduced costs compared to traditional datacenter architectures. Since the release of our CORE platform in May 2016, we have added billions of data records and continue to add approximately over a billion records per month. Our average query response time for a comprehensive profile is less than 250 milliseconds versus competitive platforms that measure comprehensive profile response times in seconds.

Performance Marketing—Our Agile Acquisition Engine drives our Performance Marketing segment, which provides solutions to help brands, advertisers and marketers find the right customers in every “B2C” vertical including, but not limited to: internet and telecommunications, financial services, health and wellness, consumer packaged goods, careers and education, and retail and entertainment. We deterministically target consumers across various marketing channels and devices, through the user-supplied acquisition of personally identifiable information on behalf of our clients, such as email addresses, other identifying information and responses to dynamically populated survey questions. 80% of our consumer interaction comes from mobile, which differentiates us from competitors whose platforms are not mobile-first.

We own hundreds of media properties, through which we engage millions of consumers everyday with interactive content, such as job postings, cost savings, surveys, promotions and contests that generate over 700,000 survey respondents and over 5 million compiled responses every single day. Our owned media properties alone have created a database of approximately 120 million U.S. adults with detailed profiles, including 150 million unique email addresses, across 60 million households. With meaningful, people-based interaction that focuses on consumer behavior and declared first-party data, leveraged on a mobile-centric platform that provides seamless omni-channel capabilities, we have the ability to target and develop comprehensive consumer profiles that redefine the way advertisers view their most valuable customers.

For the year ended December 31, 2015, we had revenue of $14.1 million and gross profit of $3.8 million. For the nine months ended September 30, 2016, we had revenue of $132.6 million, compared to $3.3 million for the same period in 2015, gross profit of $34.9 million, compared to $1.5 million for the same period in 2015, net loss attributable to cogint of $23.7 million, compared to a $51.9 million for the same period in 2015.

On a pro forma basis including Fluent, for the year ended December 31, 2015, we had revenue of $148.9 million. On a pro forma basis including Fluent and Q Interactive for the nine months ended September 30, 2016, we had revenue of $145.4 million, compared to $126.1 million for the same period in 2015, and net loss attributable to cogint of $23.1 million, compared to $55.7 million for the same period in 2015.

Our Markets

The target markets for our data and analytical solutions today consist primarily of businesses within the risk management and consumer marketing industries.

International Data Corporation, a global provider of market intelligence and advisory services, estimates, in a September 2015 study, that worldwide business analytics services and software spending was $91.6 billion in 2014 and is expected to be $113.2 billion in 2016. By 2019, this figure is expected to grow to $160.9 billion, representing a CAGR of 11.9% from 2014—2019. The big data and analytics sector continues to grow at an accelerated pace due to the proliferation of data generated by technological advancements and evolving consumer behavior. Continued, rapid adoption and use of smartphones and other mobile devices, social media and online purchasing channels, and the necessity of organizations to sort through this sea of data to glean actionable intelligence to support their daily operations, serve as key drivers of the sector’s growth.

Risk management and fraud analytics has become increasingly important not only in the banking and financial services sectors but across multiple other industries and uses cases. According to layerthe market research company

MarketsAndMarkets, the North American risk analytics software market is projected to be $8.6 billion in 2016. Data fusion analytics and the information derived therefrom is now the primary service product for risk management associated with key purchasers such as banking and financial services companies, insurance companies, healthcare companies, law enforcement and government, collection agencies, law firms, retail, telecommunications companies and private investigative firms. Primary use cases include, but are not limited to, obtaining information on consumers, businesses and assets (and their interrelationships) to facilitate the location of individuals and assets, identity verification, and to support criminal, legal, financial, insurance, and corporate investigations, due diligence and the assessment of counterparty risk.

According to the Interactive Advertising Bureau’s “Internet Advertising Revenue Report, 2015 first full year results,” total digital ad spend in the U.S. was $59.6 billion in 2015, a 20.4% increase over 2014. Mobile was the leading ad format accounting for 35% of revenues, and performance-based advertising was the leading pricing model accounting for 65% of total U.S. digital advertising spending.

Consumer marketing, which consists of paid advertising, public relations, sales strategy, customer communications and market research, is a multi-trillion-dollar global industry. Digital marketing is the fastest growing subset of this marketplace, with performance marketing being the most dominant format utilized across the industry. Advertisers prefer Performance Marketing because they only pay when specific actions are completed by consumers in response to their ads, such as making purchases, filling out information request forms, or clicking through to websites. In addition, performance marketing campaigns that target registered and validated consumers are referred to as “people-based” marketing campaigns, and are gaining favor over cookie-based campaigns which target anonymous site visitors. People-based performance marketing campaigns improve the effectiveness of advertising, increase return on ad spend, and facilitate the deterministic targeting of consumers across digital channels such as display, social, search, video and addressable television.

According to eMarketer’s, a leading market research company, worldwide spend on paid media was $513.1 billion in 2015 and is expected to grow to $674.2 billion by 2020, representing a CAGR of 5.6%. Ad spend sector growth is attributable to the growing diversity in media content and sources, and although growth will vary by region, North America is projected to remain the number one advertising region in the world.

Companies in all industries are inundated with data sourced from a growing number of digital mediums including e-commerce, mobile and social media, which provide new information on a daily basis. Companies struggle to parse through the data available to them to make decisions in real-time that improve scale and efficiency while helping them achieve and exceed their strategic goals. Our platform and analytical capabilities directly address these issues in an industry agnostic manner to solve complex problems in a robust and growing marketplace.

Key Challenges Facing our Customers

We believe our solutions overaddress the challenges that the industry faces today, which include:

Actionable Big Data Insights Through A Single Platform—As the velocity and volume of data continues to grow exponentially, enterprises have become overwhelmed with data and their uniqueinability to glean intelligence from such data sets, providing otherwise unattainable insight. In addition, as discussed below, IDI previously provided advertising servicesto derive successful business decisions in real-time. Customers demand full-suite, turn-key solutions that are agile, flexible, and available on-demand in order to gain the out-of-home advertising industryspeed, scale and insight necessary to drive their business models. As the breadth and depth of data increases, providers will need to deploy new technologies that enable both the ingestion of data at massive scale in China, but has recently discontinued its Chinese operations.

On March 21, 2015, Tiger Mediareal-time, irrespective of structure or form, and a wholly-owned subsidiary completed a merger, or the Merger, withanalytics components necessary to function across multiple channels. The Best One, Inc. or TBO, a holding company incorporated incontinued digitization of human interactions, and the Statecorresponding availability of Florida, pursuant to the termsdata resulting therefrom, is driving demand for data capture, management and conditions of a Merger Agreement and Plan of Reorganization, as amended, dated as of December 14, 2014.analysis software. As a result, customers are looking for flexible and efficient solutions to fuse disparate sets of not only transactional data but also demographic, ethnographic and behavioral data as well, in order to provide insights that are truly actionable.

Engaging Customers Across All Devices—According to the IAB, mobile advertising in the U.S. totaled $20.7 billion in 2015, a 66% increase from 2014. This impressive growth demonstrates to advertisers the importance of

mobile interaction as they search for ways to engage consumers and effectively gather critical data. Developing capabilities to acquire data from all devices and creating omni-channel advertising campaigns are both costly and complex. Traditional cookie-based targeting has proven less effective as support for cookies on mobile devices is infrequent or non-existent, ushering in the need for newer approaches for reaching consumers across devices. Developing a full solution is complex and many offerings in the marketplace struggle to adequately address this growing need.

Pricing Methodology—Historically, internet advertising has been sold on a cost-per-impression (CPM) model where an advertiser is charged each time an advertisement is displayed, regardless of user engagement with the advertisement. This dated methodology has made it difficult to truly gauge the effectiveness of advertising campaigns, and determine the actual costs associated with successful user engagement. Today’s advertising landscape now has several options for pricing advertisements, including the historical CPM method, as well as cost-per-click (CPC) which is most common in search advertising, cost-per-action (CPA), and hybrid models that may combine aspects of the Merger, IDI acquiredvarious models. With chief marketing officers increasingly accountable for demonstrating concrete return on their marketing investments, CPA and CPC models are more favorable alternatives to CPM-based offerings.

Cost and Performance Pressures—As our customers face constant cost pressures, they need to continually improve the value they receive from their information solutions. Whether it is marketing campaign spend or managing risk, consumers and customers are increasingly more sophisticated, requiring enhanced performance in order to satisfy their business of Interactive Data, LLC, or Interactive Data, which priorobjectives. Improving performance can mean delivering the right advertisement to the Merger wasright consumer at the right time, or providing the most intuitive information as rapidly as possible to capitalize on opportunities or reduce risk. Superior data fusion with unique data sources delivers customers an advantage as they cope with these pressures.

Difficult Delivery of Solutions for Complex Problems and Data Analytics at Scale—The larger and more complex a wholly-owned subsidiarycampaign or dataset, the more difficult it is to sustain the same level of TBO. TBO changed its nameperformance and insight. The highly fragmented nature of the internet display landscape, proliferation of data and lack of robust technology limits the ability to IDI Holdings, LLC target the correct users on the correct device at the correct time and on the correct portal. There is an inherent need for solutions that allow advertisers to deliver high performing campaigns regardless of size and duration.

Our Competitive Strengths

We believe our leading-edge technology platforms, massive database of holistic views of consumers, and dynamic and intuitive solutions deliver differentiated capabilities to our customers. Our solutions enable our customers to make more informed inquiries regarding their problems and better decisions to solve their most complex problems. We believe the following competitive strengths will continue to deliver an unrivaled value proposition that further drives our differentiation:

Transformative and Innovative Technology Platforms—Through the convergence of our platforms, CORE and Agile Acquisition Engine, we offer a comprehensive suite of information solutions. Our cloud-based, data and industry agnostic platform, CORE, allows us to assimilate, structure, and fuse billions of disparate records to create comprehensive views of individuals and to present these views in real-time via analytical applications. We believe our platform’s speed, power, and scalability are key differentiators in the marketplace. Our Agile Acquisition Engine enables brands to target, engage, qualify, and communicate with relevant consumers across mobile, web and in-app content environments. Furthermore, we utilize proprietary targeting algorithms and a dynamic survey module to match consumers with the most relevant advertisers, content, and media across all devices. We optimize campaigns by leveraging each advertiser’s performance data. Most valuable customer (MVC) profiles, as determined by factors such as individual-level engagement with ads and/or IDI Holdings.conversion or purchasing histories, are used to fuel lookalike modeling enabling the targeting of individuals who share similar attributes to those MVCs. This results in broadening the scale of acquisition campaigns and enhancing campaign performance.

Historically, Interactive Data provided data solutions and services to the Accounts Receivable Management industry for location and identity verification, legislative compliance and debt recovery. Interactive

Massive Database of Holistic Views of ConsumersData is now targeting the entiretylifeblood of our technology platforms. We leverage our CORE and Agile Acquisition Engine platforms to build massive proprietary datasets and apply analytics in real-time to provide actionable insights. Our Information Services data is compiled from a myriad of online and offline sources, both structured and unstructured, including public record data, publicly-available data, and proprietary data. Public record data includes personally identifiable information, as well as property, identity, bankruptcy, lien, judgment, automotive, phone and other information aggregated from companies specializing in data aggregation, public record repositories, and publicly-available sources. Proprietary data, which is compiled through our owned media properties, gathers valuable self-reported consumer information through voluntary opt-in surveys, promotions and contests. Through next-generation machine learning technology and proprietary algorithms, we efficiently ingest these datasets, structure them into common form, and utilize the process of data fusion to connect or fuse the data so as to create an actionable, real-time view of the risk management industry, including expansiondata for various use cases, delivering greater intelligence to our customers and enhancing their decision-making capabilities across all markets and industries.

In addition, our technology platforms and systems enable us to collect four distinct types of user data:

Meta-data—information gleaned by the system such as the user’s IP address, browser type, operating system, and, for mobile connected devices, the device model, device ID, browser, and mobile carrier;

Demographic data—self-reported user information such as name, address, gender, email address and telephone number;

Ethnographic data—user responses to dynamically curated and served survey questions; and

Behavioral data—purchase history, interests, likes and dislikes, preferences and frequencies. We also use our public record database and third-party services in order to verify and supplement collected data. This data is stored and analyzed, and can be further enhanced in real-time when consumers respond to dynamically populated survey questions, enabling precise targeting and profiling for ad serving and customer acquisition purposes. By using the system and the insights gained, we can develop deep and relevant insights into Fair Credit Reporting Act regulatedeach individual consumer.

Our platforms and user volume has enabled us to accumulate a massive, owned data warehouse, which contains:

First party data on over 120 million consumers;

150 million unique email addresses;

1.2 billion survey responses and non-regulatedgrowing by 5.5 million responses a day; and

More than 700,000 unique user registrations per day.

People-based Platform Enabling Deterministic, Omni-channel Marketing—Our collection of holistic information serves as the genesis for our operations and the key foundation to providing actionable consumer data. Through proprietary linking technology, advanced systems architecture,our data-centric approach to analyzing consumer characteristics and intent, we are capable of producing highly deterministic advertisements across multiple devices, including desktops, laptops, smartphones and tablets. By analyzing a massiveconsumer’s characteristics and integrating that data repository, Interactive Data will addressinto our Agile Acquisition Engine, we are able to create comprehensive profiles that deliver highly relevant and targeted advertisements on the rapidly growing needmost effective medium based on the consumer’s habits.

Performance Driven Pricing Model that Drives Heightened Return—On—InvestmentWe recognize performance marketing revenue when the conversions are generated based on predefined user actions such as a click, a registration, an app install or a coupon print. As a result, our revenue is synonymous with customer success, and we only get paid when a user engages with our advertisements. By using a performance-driven pricing model, we enjoy a number of advantages, including increased efficiencies, the ability to exceed ROI projections for actionable intelligence.customers, and optimized marketing budget allocations limited only on our ability to deliver results. Our performance-driven pricing model presents unique opportunities to work within uncapped marketing

In order for the Company

budgets which in turn creates recurring revenue streams from clients who depend on our solutions. Many of our partners view our Performance Marketing solutions as cost of sales and are incentivized to continue utilizing our solutions that directly drive consumer engagement and revenues.

Predictive Solutions For Complex Advertising Needs—Our proprietary, predictive software algorithm identifies, in real-time, consumers likely to develop new products, grow its existing businessbe receptive to our customers’ advertisements, thereby focusing marketing spend on the most efficient and expand intoeffective channel. Additionally, through targeting and optimization, we provide distinctive solutions that aim to serve the needs of our clients and provide them with the deepest insights possible, in order to make more informed decisions. Through our opt-in surveys, we are able to collect self-reported data from 700,000 consumers every day and learn valuable information that would otherwise be unavailable. This symbiotic relationship allows us to capture extremely timely and meaningful information that ultimately shapes the insights we create. Using this information, we are able to curate custom databases and audience clusters in real-time, layered with additional markets, it must generatedata from our Information Services segment to create a truly customized and sustain sufficient operating profitsunique dataset for our customers. We aim to fuse transactional public data with self-reported data, in order to create the most comprehensive view of an individual or business. Our ability to capture as well as integrate data from these two sources allows us to establish a lasting competitive advantage. The marriage of these two complementary data sources in addition to our analytic capabilities is highly unique and cash flow in future periods. This will require the Company to generate additional sales from current products and new products currently under development. Interactive Data has begun building out its sales organization to drive current products and to introduce new products into the market place. The Company will incur increased compensation expenses for its sales and marketing, executive and administrative, and infrastructure-related persons as it increases headcountdifferentiated in the next 12 months.market.

Although it was initiallyCorporate Information

Our principal executive offices are located at 2650 North Military Trail, Suite 300, Boca Raton, Florida 33431 and our intentiontelephone number is (561) 757-4000. Our Internet website address iswww.cogint.com. The website address provided in this prospectus supplement is not intended to continue, post-Merger, to operatefunction as a hyperlink and further develop its advertising business bothinformation obtained on the website is not and should not be considered part of this prospectus supplement and is not incorporated by reference in China and the United States, IDI has shifted its focus going forward towards the data fusion industry via its consolidated subsidiaries, where IDI believes the opportunities for future growth are substantially



greater. On June 30, 2015, in connectionthis prospectus supplement or any filing with the continuing shift in IDI’s focus towards the data fusion industry, IDI’s Board of Directors approved a plan under which IDI will discontinue the operations of its ChineseSecurities and BVI-based subsidiaries. The purpose of the plan is to focus IDI’s resources on the data fusion industry, where we believe the opportunities for future growth are substantially greater. Additionally, due to the continuing negative cash flow from our Chinese operations, IDI elected not to invest further in this business. See “Risk Factors.”Exchange Commission (the “SEC”).

Recent Developments

On July 23, 2015,November 28, 2016 we raised approximately $10.0$6.0 million in gross proceeds from the sale of 1,280,4102,000,000 shares of our common stock in a registered direct offering to one institutional investor.certain accredited investors (the “Investors”). The purchase price paid by the investorInvestors was $7.81$3.00 per share. Simultaneously, we conducted a private placement offering with the same accredited investorInvestors through which we issued the investor,Investors, for no additional consideration, warrants to purchase 640,2051,000,000 shares of common stock. The warrants have an exercise price of $10.00$3.75 per share and are exercisable beginning six months and one day from the date of issuance expiring 36 months(the “Exercise Date”). The warrants expire five years from the date of issuance. We are filing this registration statement as a result of our agreement with this investorExercise Date.

Pursuant to registeran engagement letter dated November 22, 2016 (the “Placement Agent Agreement”) by and between the shares underlying the investor’s warrants.

Company and Chardan Capital Markets, LLC acted(“Chardan Capital”), Chardan Capital agreed to act as our placement agent in connection with both the registered direct offering and the concurrent private placement. Pursuant to the Placement Agent Agreement, we agreed to pay Chardan Capital a cash fee equal to $250,000, as well as reimburse Chardan Capital for its expenses in connection with the offering. offering in the amount of $15,000. In addition, we granted Chardan Capital a warrant to purchase 100,000 shares of common stock. The warrants will have an exercise price of $5.00 per share and are exercisable on the Exercise Date. The warrants expire 24 months from the Exercise Date.

The net proceeds to IDIus from the offering, after deducting placement agent fees and estimated offering expenses, were approximately $9.365 million.$5.705 million, not including any proceeds received from the exercise of warrants. The registered direct offering and the concurrent private placement closed on JulyNovember 28, 2015.2016.

Corporate InformationOn December 15, 2016, we issued 200,000 shares previously held in treasury. These treasury shares represented shares issuable upon the vesting of restricted stock units previously granted to certain executive officers of the Company, which shares were withheld upon vesting for the payment of taxes.

Our principal executive offices

We are located at 2650 North Military Trail, Suite 300, Boca Raton, Florida 33431filing this registration statement as a result of our agreements with the selling stockholders to register the issuance and our telephone number is (561) 757-4000. Our Internet website address is www.ididata.com. The information on our website is not incorporated into this prospectus.resale of the Warrant Shares and the resale of the Purchased Shares.

THE OFFERING

 

Common stock outstanding prior to the offering:  15,467,28653,230,621 shares
Common stock to be issued upon exercise of the warrants:1,100,000 shares
Common stock to be offered by the selling shareholders:stockholders:  640,2051,300,000 shares(1)
Common stock outstanding immediately following the offering:  16,107,49154,530,621 shares(2)
Use of proceeds:  We will not receive any proceeds from the sale of the shares of common stock by the selling shareholderstockholders but will receive proceeds from the exercise of the warrants if the warrants are exercised, which proceeds will be used for working capital and other general corporate purposes. See “Use of Proceeds.”
Risk Factors:  See “Risk Factors” beginning on page 39 of this prospectus for a discussion of factors you should carefully consider before deciding to invest in shares of our common stock.
Stock Symbol:  NYSE MKT: IDINASDAQ: COGT

 



(1)TheIncludes 1,100,000 shares offered under this prospectus are issuable upon the exercise of warrants. Suchwarrants, which shares are not presently issued or outstanding.outstanding and 200,000 shares issued by the Company in a private placement.

(2)The number of shares of common stock to be outstanding after this offering is based on 53,230,621 shares of our common stock outstanding as of November 30, 2016, and assumes exercise of the warrants relating to their registration statement but excludes:

 

900,10812,467,419 shares of common stock underlying awards of restricted stock units (“RSUs”);

4,203,917 shares of common stock underlying vested RSUs for which shares of common stock have not been delivered;

362,000 shares of common stock issuable upon the achievementexercise of performance milestones;outstanding stock options;

 

4,634,500A possible earnout payment in connection with the acquisition of Q Interactive LLC. If the earnout is earned then, at the seller’s option, seller will be paid in shares either (i) 1,200,000 shares of common stock underlying restricted stock units;

422,000(subject to adjustment for certain capital events) or (ii) that number of shares of common stock underlyingequal to $10,000,000 in the aggregate, as determined by the volume weighted average price of the common stock options;for the ten trading days immediately before determination that the earnout target was achieved (the “Q Interactive Earn-out Shares”). As of September 30, 2016, the number of shares of common stock to be issued pursuant to the earnout would be 1,879,700 shares;

 

4,965,3021,120,102 shares of common stock issuable upon conversionthe exercise of other outstanding shares of our Series A Convertible Preferred Stock (“Series A”);warrants; and

 

1,800,2205,093 shares of common stock issuable upon conversion of shares of Series A issuable uponpursuant to the achievement of performance milestones.working capital adjustment in connection with the Fluent, LLC acquisition on December 8, 2015.

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

This prospectus, including the documents that are incorporated documentsby reference, contains “forward-looking statements” within the meaning of the safe harbor from civil liability provided for such statements by the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements. All statements other than statementsby the use of historical facts, including statements regarding our future financial position, liquidity, business strategy and plans and objectives of management for future operations, are forward-looking statements. The words “believe,such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “estimate,“plans,“continue,“projects,“anticipate,” “intend,“seeks,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “will,” “expect” and variations of such words or similar expressions, as they relate to us,expressions. Forward-looking statements in this prospectus, including the documents that are intended to identify forward-looking statements. We have based these forward-lookingincorporated by reference, include, among others, statements largely onabout our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, our business strategy and financial needs.

The results anticipatedobjectives, and expected liquidity needs and sources. Our forward-looking statements reflect our current views about our plans, intentions, expectations, strategies and prospects, which are based on the information currently available to us and on assumptions we have made. Although we believe that our plans, intentions, expectations, strategies and prospects as reflected in or suggested by anyour forward-looking statements are reasonable, we can give no assurance that our plans, intentions, expectations, strategies or all ofprospects will be attained or achieved and you should not place undue reliance on these forward-looking statements might not occur. Important factors, uncertainties and risks that may causestatements. Furthermore, actual results tomay differ materially from thesethose described in the forward-looking statements and may be affected by a variety of risks and factors including the factors included in our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, including those set forth under the headings “Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations;”

Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for us to predict those events or how they may affect us. Except as required by law, we are contained in the risk factors that follownot obligated to, and elsewhere in this prospectus and the incorporated documents. We undertake no obligationdo not intend to, publicly update or revise any forward-looking statements, whether as thea result of new information, future events or otherwise. Accordingly, investors should use caution in relying on past forward-looking statements, which were based on results and trends at the time they were made, to anticipate future results or trends. For more information regarding somea further discussion of the ongoing risksthese and uncertainties ofother factors that could impact our business,future results, performance or transactions, see the risk factors that follow“Risk Factors” below and or that are disclosed inthose incorporated by reference from our incorporated documents.most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q.

RISK FACTORS

BecauseAn investment in our common stock involves a high degree of risk. Before deciding whether to invest in our common stock, you should consider carefully the Risk Factorsrisks described below and discussed under the section captioned “Risk Factors” in theour Annual Report on Form 10-K for the year ended December 31, 2014 were in material part based on the legacy Chinese business, we have revised the Risk Factors and investors should focus on the risks2015, which follow.

Investing in our securities involves a high degree of risk. Before purchasing the securities offered by this prospectus, you should consider carefully the risk factors contained in this prospectus, as well as the risks, uncertainties and additional information (i) set forth in our SEC reports on Forms 10-K, 10-Q and 8-K, and in the other documents that we file with the SEC after the date of this prospectus, all of which are deemedis incorporated by reference in this prospectus althoughin its entirety, as noted above, thewell as any amendment or update to our risk factors containedreflected in subsequent filings with the Form 10-K for the year ended December 31, 2014 have been in part superseded by the risk factors containedSEC, together with other information in this prospectus and (ii) the information contained in any applicable prospectus supplement. For a description of these reports and documents, and information about where you can find them, see “Incorporation of Certain Documents By Reference.” The risks and uncertainties we discuss in this prospectus and in the documents incorporated by reference in this prospectus are those that we currently believe may materially affecthave authorized for use in connection with this offering. If any of these risks actually occur, our company. Additional risks not presently known, or currently deemed immaterial, also could materially and adversely affect ourbusiness, financial condition, results of operations business and prospects.

or cash flows could be seriously harmed. This could cause the trading price of our common stock to decline, resulting in a loss of all or part of your investment.

Risks RelatingRelated to Our Businesscommon stock and This Offering

Although IDI Holdings was not incorporated until September 22, 2014, itOur stock price has incurred operating losses and negative cash flow from operations which makes our future results uncertain.

IDI Holdings was incorporated on September 22, 2014, after which it promptly acquired Interactive Data, an operating business in the data fusion industry. Since inception, IDI Holdings has incurred operating losses and negative cash flow from operations. We are investing significant capital in order to enhance our technology platform. Additionally, we have ramped up our marketing efforts, which may further increase short-term operating losses and cash flow deficits. We cannot assure you we will be profitable in the future.

To achieve sustainable profitability, we must continue to generate increased revenue.

We need to generate greater revenue from the sales of our products if we are to sustain profitability. If we are unable to generate greater revenue, we may not be able to sustain profitability or generate positive cash flow from operations in the future.

Our revenues are concentrated in the U.S. market across a broad range of industries. When these industries or the broader financial markets experience a downturn, demand for our services and revenues may be adversely affected.

Our customers, and therefore our business and revenues, sometimes depend on favorable macroeconomic conditions and are impacted by the availability of credit, the level and volatility of interest rates, inflation, employment levels, consumer confidence and housing demand. In addition, a significant amount of our revenues are concentrated among certain industries. Our customer base suffers when financial markets experience volatility, illiquidity and disruption, which has occurred in the past and which could reoccur. Such market developments, and the potential for increased and continuing disruptions going forward, present considerable risks to our business and operations. Changes in the economy have resulted,been and may continue to result,be volatile, and the value of an investment in fluctuations in volumes, pricing and operating margins for our services. For example, the banking and financial market downturn that began to affect U.S. businesses in 2008 caused a greater focus on expense reduction by customers of businesses similar to ours. If businesses in these industries experience economic hardship, we cannot assure you that we will be able to generate future revenue growth. These types of disruptions could lead to a decline in the volumes of services we provide our customers and could negatively impact our revenue and results of operations.common stock may decline.

Our relationships with key customers may be materially diminished or terminated.

We have established relationships with a number of customers, many of whom could unilaterally terminate their relationship with us or materially reduce the amount of business they conduct with us at any time. Market competition, customer requirements, customer financial condition and customer consolidation through mergers or acquisitions also could adversely affect our ability to continue or expand these relationships. There is no guarantee that we will be able to retain or renew existing agreements, maintain relationships with anyThe trading price of our customers on acceptable terms or at all or collect amounts owed to us from insolvent customers. The loss of one or more of our major customers could adversely affect our business, financial condition and results of operations.

We could lose our access to data sources which could prevent us from providing our services.

Our services and products depend extensively upon continued access to and receipt of data from external sources, including data received from customers, strategic partners and various government and public records repositories. In some cases, we compete with our data providers. Our data providers could stop providing data, provide untimely data or increase the costs for their data for a variety of reasons, including a perception that our systems are insecure as a result of a data security breach, budgetary constraints, a desire to generate additional revenue or for regulatory or competitive reasons. We could also become subject to increased legislative, regulatory or judicial restrictions or mandates on the collection, disclosure or use of such data, in particular if such data is not collected by our providers in a way that allows us to legally use the data. If we were to lose access to this external data or if our access or use were restricted or were to become less economical or desirable, our ability to provide services could be negatively impacted, which would adversely affect our reputation, business, financial condition and results of operations. We

cannot provide assurance that we will be successful in maintaining our relationships with these external data source providers or that we will be able to continue to obtain data from them on acceptable terms or at all. Furthermore, we cannot provide assurance that we will be able to obtain data from alternative sources if our current sources become unavailable.

We face intense competition from both start-up and established companies that may have significant advantages over us and our products.

The market for our products and services is intensely competitive. There are numerous companies competing with us in various segments of the data fusion industry, and their products and services may have advantages over our products and services in areas such as conformity to existing and emerging industry standards, performance, price, ease of use, scalability, reliability, flexibility, product features and technical support.

IDI’s principal competitors in the data fusion industry include Palantir, LexisNexis, TransUnion, and Thomson Reuters. Current and potential competitors may have one or more of the following significant advantages:

greater financial, technical and marketing resources;

better name recognition;

more comprehensive solutions;

better or more extensive cooperative relationships; and

larger customer base.

We cannot assure you that IDI will be able to compete successfully with its existing or new competitors. Some of our competitors may have, in relation to us, one or more of the following: longer operating histories, longer-standing relationships with end-user customers and greater customer service, public relations and other resources. As a result, these competitors may be able to more quickly develop or adapt to new or emerging technologies and changes in customer requirements, or devote greater resources to the development, promotion and sale of their products and services. Additionally, it is likely that new competitors or alliances among existing competitors could emerge and rapidly acquire significant market share.

There may be further consolidation in our end-customer markets, which may adversely affect our revenues.

Therecommon stock has been and we expect there will likely continue to be merger, acquisitionhighly volatile and consolidation activitycould be subject to wide fluctuations in our customer markets. If our customers merge with, or are acquired by, other entities that are not our customers, or that use fewer of our services, our revenue may be adversely impacted. In addition, industry consolidation could affect the base of recurring transaction-based revenue if consolidated customers combine their operations under one contract, since many of our contracts provide for volume discounts. In addition, our existing customers might leave certain geographic markets, which would no longer require themresponse to purchase certain products from us and, consequently, we would generate less revenue than we currently expect.

To the extent the availability of free or relatively inexpensive consumer and/or business information increases, the demand forvarious factors, some of which are beyond our services may decrease.

Public and commercial sources of free or relatively inexpensive consumer and business information have become increasingly available and this trend is expected to continue. Public and commercial sources of free or relatively inexpensive consumer and/or business information may reduce demand for our services. To the extent that our customers choose not to obtain services from us and instead rely on information obtained at little or no cost from these public and commercial sources, our business, financial condition and results of operations may be adversely affected.

If IDI’s newer products do not achieve market acceptance, revenue growth may suffer.

IDI’s location and identity verification products have been in the market place for a limited period of time and may have longer sales cycles than its previous products. Accordingly, we may not achieve the meaningful revenue growth needed to sustain operations. We cannot provide any assurances that sales of its newer products will continue to grow or generate sufficient revenues to sustain its business. If IDI is unable to recognize revenues due to longer sales cycles or other problems, its results of operationscontrol. These factors could be adversely affected.

IDI has not yet received broad market acceptance for its newer products. IDI cannot assure you that its present or future products will achieve market acceptance on a sustained basis. In order to achieve market acceptance and achieve future revenue growth, we must introduce complementary products, incorporate new technologies into existing product lines and design, and develop and successfully commercialize higher performance products in a timely manner. IDI cannot assure you that it will be able to offer new or complementary products that gain market acceptance quickly enough to avoid decreased revenues during current or future product introductions or transitions.

IDI’s products and services can have long sales and implementation cycles, which may result in substantial expenses before realizing any associated revenues.

The sale and implementation of our data products and services to large companies and government entities typically involves a lengthy education process and a significant technical evaluation and commitment of capital and other resources. This process is also subject to the risk of delays associated with customers’ internal budgeting and other procedures for approving capital expenditures, and testing and accepting new technologies that affect key operations. As a result, sales and implementation cycles for IDI’s data products and services can be lengthy, and IDI may expend significant time and resources before it receives any revenues from a customer or potential customer. IDI’s quarterly and annual operating results could be adversely affected if orders forecast for a specific customer and for a particular period are not realized.

IDI resembles a developmental stage company and its business strategy may not be successful.

Historically, Interactive Data provided data solutions and services to the Accounts Receivable Management industry for location and identity verification, legislative compliance and debt recovery. Interactive Data is now targeting the entirety of the risk management industry, including expansion into Fair Credit Reporting Act regulated data and non-regulated data, with new products and services. IDI can provide no assurances that these newly introduced products and services will ever achieve widespread market acceptance or that an adequate market for these products and services will ever emerge. Consequently, IDI resembles a developmental stage company and will face the following inherent risks and uncertainties:include:

 

the need for our products and services to achieve market acceptance and produce a sustainable revenue stream;

our ability to manage costs and expenses;

our ability to secure, and dependence on,additions or departures of key personnel;

 

changes in governmental regulations or in the status of our ability to obtain financing on acceptable terms;regulatory approvals;

changes in earnings estimates or recommendations by securities analysts;

any major change in our board or management;

general economic conditions and slow or negative growth of our markets; and

 

political instability, natural disasters, war and/or events of terrorism.

From time to time, we estimate the timing of the accomplishment of various commercial and other product development goals or milestones. Also, from time to time, we expect that we will publicly announce the anticipated timing of some of these milestones. All of these milestones are based on a variety of assumptions. The actual timing of these milestones can vary dramatically compared to our abilityestimates, in some cases for reasons beyond our control. If we do not meet these milestones as publicly announced, our stock price may decline.

In addition, the stock market has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to offer greater value than our competitors.

IDI’s business strategythe operating performance of publicly traded companies. Broad market and industry factors may not successfully address these risks. If it fails to recognize significant revenues fromseriously affect the salesmarket price of new products and services, business, financial condition andcompanies’ stock, including ours, regardless of actual operating results wouldperformance. These fluctuations may be materially adversely affected.

If IDI fails to respond to rapid technological changeseven more pronounced in the data fusion industry, it may lose customers and/or its products and/or services may become obsolete.

The data fusion industry is characterized by rapidly changing technology, frequent product introductions,trading market for our stock. In addition, in the past, following periods of volatility in the overall market and continued evolutionthe market price of new industry standards. IDI must also introduce upgrades to its products and services rapidly in response to customer needs. As a result, IDI’s success depends upon its ability to develop and introduce in a timely manner new products and services and enhancements to its existing products and services that meet changing

customer requirements and evolving industry standards. The development of technologically advanced product solutions is a complex and uncertain process requiring high levels of innovation, rapid response and accurate anticipation of technological and market trends. IDI cannot assure you that it will be able to identify, develop, manufacture, market or support new or enhanced products and services successfully in a timely manner. Further, IDI or its competitors may introduce new products or services or product enhancements that shorten the life cycle of existing products or services or cause existing products or services to become obsolete.

IDI’s products and services are highly technical andparticular company’s securities, securities class action litigation has often been instituted against these companies. This litigation, if they contain undetected errors, its business could be adversely affected and it may have to defend lawsuits or pay damages in connection with any alleged or actual failure of its products and services.

IDI’s products and services are highly technical and complex. Our products and services have contained and may contain one or more undetected errors, defects or security vulnerabilities. Some errors in our products and services may only be discovered after a product or service has been used by end customers. Any errors or security vulnerabilities discovered in IDI’s products after commercial releaseinstituted against us, could result in loss of revenues or delay in revenue recognition, or loss of customers, any of which could adversely affect its businesssubstantial costs and results of operations. In addition, IDI could face claims for product liability or breach of personally identifiable information. Defending a lawsuit, regardless of its merit, is costly and may divert management’s attention. In addition, if IDI’s business liability insurance coverage is inadequate or future coverage is unavailable on acceptable terms or at all, its financial condition could be harmed.

A breach of network security could harm public perception of IDI’s products and services, which could cause it to lose revenues.

If an actual or perceived breach of network security occurs, regardless of whether the breach is attributable to IDI’s network security controls, the market perception of the effectiveness of IDI’s network security could be harmed resulting in loss of current and potential end user customers, data suppliers, or cause IDI to lose potential value-added resellers. Because the techniques used by computer hackers to access or sabotage networks change frequently and generally are not recognized until launched against a target, IDI may be unable to anticipate these techniques. If an actual or perceived breach were to occur, we cannot assure you that IDI would not lose revenue or not sustain operating losses as a result.

Because our networks and information technology systems are critical to our success, we may be vulnerable to unauthorized persons hacking our systems or our systems may otherwise cease to function properly, which could result in the theftdiversion of our proprietary information, disrupt our operationsmanagement’s attention and materially adversely affect our business.resources.

The data fusion industry relies heavily on large information technology databases andOur management will have broad discretion as to the ability to provide services using that information. A party who is able to breach the security measures on our networks could misappropriate either our proprietary information or the personal information of consumers that we collect, or otherwise cause interruptions or malfunctions to our operations. Hacking of computer data systems is a growing problem throughout the United States. If we grow and obtain more visibility, we may be more vulnerable to hacking. We may be required to expend significant capital and other resources to protect against such threats or to alleviate problems caused by breaches in security. Additionally, any server interruptions, break-downs or system failures, including failures which may be attributable to events within our control, could increase our future operating costs and cause us to lose business. We maintain insurance policies covering losses relating to our network systems or other assets. However, these policies may not cover the entire cost of a claim. Any future disruptions in our information technology systems, whether caused by hacking or otherwise, may have a material adverse effect on our future revenues and results of operations.

Consolidation in the data fusion industry may limit market acceptance of IDI’s products and services.

Several of our competitors have acquired companies with complementary technologies in the past. IDI expects consolidation in the data fusion industry to continue in the future. These acquisitions may permit IDI’s competitors to accelerate the development and commercialization of broader product lines and more comprehensive solutions

than IDI currently offers. Acquisitions of vendors or other companies with which IDI has a strategic relationship by its competitors may limit its access to commercially significant technologies. Further, business combinations in the data fusion industry are creating companies with larger market shares, customer bases, sales forces, product offerings and technology and marketing expertise, which may make it more difficult for IDI to compete.

IDI must adequately protect its intellectual property in order to prevent loss of valuable proprietary information.

IDI relies primarily upon a combination of patent, copyright, trademark and trade secret laws, confidentiality procedures and non-disclosure agreements to protect its proprietary technology. However, unauthorized parties may attempt to copy or reverse-engineer aspects of IDI’s products or services or to obtain and use information that it regards as proprietary. Policing unauthorized use of IDI’s products or services is difficult,proceeds from the exercise of your warrants, and IDI cannot be certain that the steps it has taken will prevent misappropriation of its intellectual property. If the protection of IDI’s intellectual property proves to be inadequate or unenforceable, others may be able to use its proprietary developments without compensation to IDI, resulting in potential cost advantages to its competitors.

IDI may incur substantial expenses defending itself against claims of infringement.

There are numerous patents held by many companies relating to the design and manufacture of data solutions. Third parties may claim that our products and/or services infringe on their intellectual property rights. Any claim, with or without merit, could consume management’s time, result in costly litigation, cause delays in sales or implementation of products or services or require entry into royalty or licensing agreements. In this respect, patent and other intellectual property litigation is becoming increasingly more expensive in terms of legal fees, expert fees and other expenses. Royalty and licensing agreements, if required and available, may be on terms unacceptable to IDI or detrimental to its business. Moreover, a successful claim of product infringement against IDI or its failure or inability to license the infringed or similar technology on commercially reasonable terms could seriously harm its business.

We depend, in part, on strategic alliances, joint ventures and acquisitions to grow our business. If we are unable to make strategic acquisitions and develop and maintain these strategic alliances and joint ventures, our growth may be adversely affected.

An important focus of our business is to identify business partners who can enhance our services and enable us to develop solutions that differentiate us from our competitors. We have entered into several alliance agreements or license agreements with respect to certain of our datasets and services and may enter into similar agreements in the future. These arrangements may require us to restrict our use of certain of our technologies or datasets among certain customer industries, or to grant licenses on terms that ultimately may prove to be unfavorable to us, either of which could adversely affect our business, financial condition or results of operations. Relationships with our alliance agreement partners may include risks due to incomplete information regarding the marketplace and commercial strategies of our partners, and our alliance agreements or other licensing agreements may be the subject of contractual disputes. If we or our alliance agreements’ partners are not successful in maintaining or commercializing the alliance agreements’ services, such commercial failure could adversely affect our business.

If we consummate any future acquisitions, we will be subject to all the risks inherent in identifying, acquiring and operating new acquired business.

On March 21, 2015, we merged with IDI Holdings and transformed the nature of our business. IDI Holdings, in turn, had acquired Interactive Data in October 2014 shortly following IDI Holdings’ incorporation. We may, in the future, acquire businesses which we believe could compliment or expand our current business or offer growth opportunities. We may experience difficulties in identifying potential acquisition candidates that complement our current business at appropriate prices, or at all. We cannot assure you that our acquisition strategy will be successful. We may spend significant management time and resources in analyzing and negotiating acquisitions or investments that are not consummated. Furthermore, the ongoing process of integrating an acquired business is distracting, time consuming, expensive, and requires continuous optimization and allocation of resources. Additionally, if we use stock as consideration, this would dilute our existing shareholders. Contrarily, if we use cash, this would reduce our liquidity and impact our financial flexibility. We may seek debt financing for particular acquisitions, which may not

be available on commercially reasonable terms, or at all. We face all the risks associated with the business acquisition strategy, including:

the potential disruption of our existing businesses, including the diversion of management attention and the redeployment of resources;

entering new markets or industries in which we have limited prior experience;

our failure in due diligence to identify key issues specific to the businesses we seek to acquire or the industries or other environments in which they operate, or, failure to protect against contingent liabilities arising from those issues;

unforeseen, hidden or fraudulent liabilities;

our difficulties in integrating, aligning and coordinating organizations which will likely be geographically separated and may involve diverse business operations and corporate cultures;

our difficulties in integrating and retaining key management, sales, research and development, production and other personnel;

the potential loss of key employees, customers or distribution partners of the acquired businesses;

our difficulties in incorporating the acquired business into our organization;

the potential loss of customers, distributors or suppliers;

our difficulties in integrating or expanding information technology systems and other business processes to accommodate the acquired business;

the risks associated with integrating financial reporting and internal control systems;

the potential for future impairments of goodwill if the acquired business does not perform as expected;

the inability to obtain necessary government approvals for the acquisition, if any; and

our successfully operating the acquired business.

If we cannot overcome these challenges, we may not realize actual benefits from past and future acquisitions, whichuse the proceeds effectively.

Our management will impair our overall business results. If we complete an investment or acquisition, we may not realizehave broad discretion in the anticipated benefitsapplication of the net proceeds from the transaction.

Our business is subject to various governmental regulations, lawsexercise of your warrants and orders, compliance with which may cause us to incur significant expensescould spend the proceeds in ways that do not improve our results of operations or reduceenhance the availability or effectivenessvalue of our solutions, andcommon stock. You will not have the opportunity, as part of your investment decision, to assess whether these proceeds are being used appropriately. Our failure to comply with which could subject us to civil or criminal penalties or other liabilities.

Our businesses are subject to regulation under the Gramm-Leach-Bliley Act (the “GLBA”), the Driver’s Privacy Protection Act (the “DPPA”), the Health Insurance Portability and Accountability Act, the Federal Trade Commission Act (the “FTC Act”) and various other federal, state and local laws and regulations. These laws and regulations, which generally are designed to protect the privacy of the public and to prevent the misuse of personal information available in the marketplace, are complex, change frequently and have tended to become more stringent over time. We already incur significant expenses in our attempt to ensure compliance withapply these laws. Currently, public concern is high with regard to the collection, use, accuracy, and sharing of personal information, including Social Security numbers, dates of birth, financial information, department of motor vehicle data and other behavioral data. In addition, many consumer advocates, privacy advocates, legislatures and government regulators believe that existing laws and regulations do not adequately protect privacy and have become increasingly concerned with the use of this type of personal information. As a result, they are lobbying for further restrictions on the dissemination or commercial use of personal information to the public and private sectors. Additional legislative or regulatory efforts in the United States, or an action by Executive Order of the President of the United States, could further regulate the collection, use, communication, access, accuracy, obsolescence, sharing, correction and security of this personal information. In addition, any perception that our practices or products are an invasion of privacy, whether or not consistent with current or future regulations and industry practices, may subject us to public criticism, private class actions, reputational harm, or claims by regulators, which could disrupt our business and expose us to increased liability.

The following legal and regulatory developments alsofunds effectively could have a material adverse effect on our business financial condition or results of operations:

amendment, enactment or interpretation of laws and regulations that restrictcause the access and use of personal information and reduce the availability or effectivenessprice of our solutions or the supply of data available;
common stock to decline.

changes in cultural and consumer attitudes in favor of further restrictions on information collection and sharing, which

We expect that we may lead to regulations that prevent full utilization of our solutions;

failure of data suppliers or customers to comply with laws or regulations, where mutual compliance is required;

failure of our solutions to comply with current laws and regulations; and

failure of our solutions to adapt to changesneed additional capital in the regulatory environment in an efficient, cost-effective manner.

Changes in applicable legislation or regulations that restrict or dictate how we collect, maintain, combine and disseminate information could adversely affect our business, financial condition or results of operations. In the future, we may be subject to significant additional expense to ensure continued compliance with applicable laws and regulations and to investigate, defend or remedy actual or alleged violations. Any failure by us to comply with applicable laws or regulations could also result in significant liability to us, including liability to private plaintiffs as a result of individual or class action litigation, or may result in the cessation of our operations or portions of our operations or impositions of fines and restrictions on our ability to carry on or expand our operations. Moreover, our compliance with privacy laws and regulations and our reputation depend in part on our customers’ adherence to privacy laws and regulations and their use of our services in ways consistent with consumer expectations and regulatory requirements. Certain of the laws and regulations governing our business are subject to interpretation by judges, juries and administrative entities, creating substantial uncertainty for our business. We cannot predict what effect the interpretation of existing or new laws or regulations may have on our business.

The outcome of litigation, inquiries, investigations, examinations or other legal proceedings in which we are involved, in which we may become involved, or in which our customers or competitors are involved could subject us to significant monetary damages or restrictions on our ability to do business.

Legal proceedings arise frequently as part of the normal course of our business. These may include individual consumer cases, class action lawsuits and inquiries, investigations, examinations, regulatory proceedings or other actions brought by federal (e.g., the United States Federal Trade Commission (“FTC”)) or state (e.g., state attorneys general) authorities or by consumers. The scope and outcome of these proceedings is often difficult to assess or quantify. Plaintiffs in lawsuits may seek recovery of large amounts and the cost to defendfuture; however, such litigation may be significant. There may also be adverse publicity and uncertainty associated with investigations, litigation and orders (whether pertaining to us, our customers or our competitors) that could decrease customer acceptance of our services or result in material discovery expenses. In addition, a court-ordered injunction or an administrative cease-and-desist order or settlement may require us to modify our business practices or may prohibit conduct that would otherwise be legal and in which our competitors may engage. Many of the technical and complex statutes to which we are subject, including state and federal financial privacy requirements, may provide for civil and criminal penalties and may permit consumers to maintain individual or class action lawsuits against us and obtain statutorily prescribed damages. Additionally, our customers might face similar proceedings, actions or inquiries, which could affect their business and, in turn, our ability to do business with those customers. While we do not believe that the outcome of any pending or threatened legal proceeding, investigation, examination or supervisory activity will have a material adverse effect on our financial position, such events are inherently uncertain and adverse outcomes could result in significant monetary damages, penalties or injunctive relief against us.

Because we are winding down our legacy Chinese business, we expect to incur a one-time non-cash charge of approximately $42 million.

In order to conserve cash and focus on IDI’s business, we are terminating our operations in China. As a result, we will be required to write off the goodwill, intangible assets, property, equipment and long-term deferred assets on

our balance sheet of approximately $41 million. We will incur costs related to the termination of these employees of approximately $0.3 million. This will cause us to report substantial operating losses for the three months ended June 30, 2015 and year ending December 31, 2015.

Risks Relating to Our Common Stock

Voting control by executive officers, directors and other affiliates of IDI may limit your ability to influence the outcome of director elections and other matters requiring shareholder approval.

The executive officers, directors and other affiliates of IDI beneficially own approximately 37% of our voting shares as of August 11, 2015. These shareholders can control substantially all matters requiring approval by our shareholders, including the election of directors and the approval of other business transactions. This concentration of ownership could have the effect of delaying or preventing a change in control of IDI or discouraging a potential acquirer from attempting to obtain control of IDI, which in turn could have a material adverse effect on the market price of shares of common stock or prevent our shareholders from realizing a premium over the market price for their shares of common stock.

Because we may be required to raise capital additional equity or debt financing may not be available and, if available, may significantly dilute the value of currently outstanding common stock.

We expect to fund operations through current cash and future profits. Subject to revenue growth, we may have to raise private equity and or debt, which, if we are able to obtain, will have the effect of diluting existing common and preferred shareholders. Any equity or debt financings, if available at all, may beus on reasonable terms, which are not favorable to us. If our operations do not generate positive cash flow in the upcoming year, or if IDI is not able to obtain additional debt or equity financing on terms and conditions acceptable to it, if at all, when or as we may be unable to implement our business plan.

Future sales of our common stock may depress our stock price.

As of August 11,require additional funding. If we had 15,467,286issue additional shares of our common stock outstanding, 10,662,007 shares ofor other securities that may be convertible into, or exercisable or exchangeable for, our common stock, underlying restricted stock units, stock options, warrants, and convertible preferred stock, and anour existing stockholders may experience further dilution.

Although we expect that we may need additional 2,700,328 shares issuable upon the achievement of certain performance milestones under outstanding agreements. Approximately 8.2 million shares of our outstanding shares are eligible for resale either without restrictions or under Rule 144 of the Securities Act of 1933, or Rule 144, provided,capital in the latter case,future, we cannot be certain that certain volume restrictionsit will be available to us on acceptable terms when required, or at all. Disruptions in the global equity and other conditions are met. If anycredit markets may limit our ability to access capital. To the extent that we raise additional funds by issuing equity securities, our stockholders may experience dilution, which may be significant number of these shares are sold, such salesand could have a depressive effect oncause the market price of our stock. In addition, upon issuance, some of the shares underlying the restrictedcommon stock units, stock options, warrants and convertible preferred stock will be eligible to be offered from time to time in the public market pursuant to registration statementsdecline significantly. Any debt financing, if available, may restrict our operations. If we may file and Rule 144, and any such sale of these shares may have a depressive effect as well. We are unable to predict the effect, if any, that the saleraise additional capital when required or on acceptable terms, we may have to significantly delay, scale back or discontinue certain operations. Any of shares, or the availability of shares for future sale, will have on the market price of the shares prevailing from time to time. Sales of substantial amounts of shares in the public market, or the perception that such salesthese events could occur, could depress prevailing market prices for the shares. Such sales may also make it more difficult for us to sell equity securities or equity-related securities in the future at a time and price, which we deem appropriate.

If we lose the services of key personnel, it could adversely affect our business.

Our future success depends, in part, on our ability to attract and retain key personnel. Our future also depends on the continued services of Michael Brauser, our Executive Chairman, Derek Dubner, our Co-Chief Executive Officer, James P. Reilly, our President, and Ole Poulsen, Chief Science Officer of IDI, each of whom is important to the management of certain aspects ofsignificantly harm our business and operations and the development of our strategic direction, and each of whom may be difficult to replace. We do not carry “key man” life insurance policies on any of these individuals. The loss of the services of these key individuals and the process to replace these individuals would involve significant time and expenseprospects and could significantly delay or prevent the achievement ofcause our business objectives.stock price to decline.

USE OF PROCEEDS

We will not receive any proceeds from the sale of the shares of common stock by the selling shareholderstockholders but will receive proceeds from the exercise of the warrants if the warrants are exercised, which proceeds will be used for working capital and for other general corporate purposes.purposes, including funding potential future acquisitions.

From time to time, we engage in preliminary discussions and negotiations with various businesses in order to explore the possibility of an acquisition or investment. However, as of the date of this prospectus supplement, we have not entered into any agreements or arrangements which would make an acquisition or investment probable under Rule 3-05(a) of Regulation S-X.

SELLING SHAREHOLDERSTOCKHOLDERS

The following table provides information about the selling shareholder, Intracoastal Capital LLC (“Intracoastal”),stockholders, listing how many shares of our common stock the selling shareholder ownsstockholders own on the date of this prospectus, how many shares are offered for saleand how many may be issued upon the exercise of warrants covered by this prospectus, and the number and percentage of outstanding shares the selling shareholderstockholders will own after the offering, assuming all shares covered by this prospectus are sold. Intracoastal is presently the beneficial owner of over 5% of our outstanding common stock. Neither Intracoastal nor its Manager, Mitchell P. Kopin, has held any position, office, or material relationship with us or our affiliates within the past three years. The information concerning beneficial ownership has been taken from our stock transfer records and a questionnaire provided to us by the selling shareholder on August 11, 2015, which we have not independently verified.stockholders. Information concerning the selling shareholderstockholders may change from time to time, and any changed information will be set forth if and when required in prospectus supplements or other appropriate forms permitted to be used by the SEC.

We do not know when or in what amounts the selling shareholderstockholders may offer shares for sale, although the selling shareholderstockholders cannot exercise the warrants underlying the sharesWarrant Shares registered herein before January 23, 2016.May 29, 2017. The selling shareholderstockholders may choose not to sell any or all of the shares offered by this prospectus. Because the selling shareholderstockholders may offer all or some of the shares, and because there are currently no agreements, arrangements or understandings with respect to the sale of any of the shares, we cannot accurately report the number of the shares that will be held by the selling shareholderstockholders after completion of the offering. However, for purposes of this table, we have assumed that, after completion of the offering, all of the shares covered by this prospectus will be sold by the selling shareholder.stockholders.

Except to the extent that the sharesWarrant Shares registered herein cannot be acquired or sold by the selling shareholderstockholders prior to January 23, 2016,May 29, 2017, as disclosed above, the selling shareholderstockholders may have sold, transferred or otherwise disposed of, or may sell, transfer or otherwise dispose of, at any time or from time to time since the date on which it provided the information regarding the shares beneficially owned,hereof, a portion of the shares beneficially owned in transactions exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”).Act.

The number of shares outstanding, and the percentage of beneficial ownership, post-offering are based on 16,107,49154,530,621 shares of our common stock issued and outstanding as of the conclusion of the offering, calculated on the basis of (i) 15,467,28653,230,621 shares issued and outstanding as of August 11, 2015November 30, 2016 and (ii) assumed exercise and sale by the selling shareholderstockholders of all warrants underlying the sharesWarrant Shares registered herein. For the purposes of the following table, the number of shares of common stock beneficially owned has been determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934 (the “Exchange Act”), and such information is not necessarily indicative of beneficial ownership for any other purpose. Under Rule 13d-3, beneficial ownership includes any

shares as to which the selling shareholder hasstockholders have sole or shared voting power or investment power and also any shares which thateach selling shareholder, respectively, has the right to acquire within 60 days of the date of this prospectus through the exercise of any stock option, warrant or other rights. No selling shareholder has had any position, office or any other material relationship with the Company or any of its predecessors or affiliates within the past three years other than in connection with the transactions disclosed in the Recent Development section of this prospectus.

 

Name  Number of
securities
beneficially
owned before
offering
   Number of
securities
to be
offered
   Number of
securities
owned after
offering
   Percentage of
securities
beneficially
owned after
offering
   Number of
securities
beneficially
owned before
offering(1)
   Number of
securities
to be
offered(2)
   Number of
securities
owned after
offering(3)
   Percentage of
securities
beneficially
owned after
offering
 

Intracoastal Capital LLC(4)

   1,090,418     640,205     1,090,418     6.8   1,070,102     166,667     1,070,102     2.0

Empery Asset Master, LTD(5)

   699,195     349,598     699,145     1.3  

Empery Tax Efficient, LP(6)

   394,529     197,264     394,529     *  

Empery Tax Efficient II, LP(7)

   572,942     286,471     572,942     1.1  

Chardan Capital Markets, LLC(8)

   —       19,000     —       *  

Jonathan Schechter(9)

   —       31,000     —       *  

Joseph Reda(9)

   —       50,000     —       *  

Monroe Capital, LLC(10)

   344,235     200,000     144,235     *  

The number of securities to be offered represents 640,205 shares of common stock issuable upon the exercise of warrants (the “Warrant Shares”). Pre-offering beneficial ownership does not include the Warrant Shares because the Warrant Shares cannot, under the terms of the warrants, be acquired by the selling shareholder within 60 days. The number of securities beneficially owned post-offering assumes the exercise of the warrants and acquisition and sale of the Warrant Shares in compliance with the terms of the warrants, including a 4.99% beneficial ownership blocker provision. Messrs. Mitchell P. Kopin and Daniel B. Asher, managers of Intracoastal, share voting control and investment discretion with respect to the Warrant Shares and each is deemed to have beneficial ownership over the securities held by Intracoastal. Intracoastal’s address is 245 Palm Trail, Delray Beach, Florida 33483.

*Less than one percent.
(1)In addition to shares of common stock as described in footnote (2), also includes shares of common stock identified to us by the selling stockholders as owned. Pre-offering beneficial ownership does not include the Warrant Shares because the Warrant Shares cannot, under the terms of the warrants, be acquired by the selling stockholders within 60 days.
(2)The number of securities to be offered represents 1,100,000 shares of common stock issuable upon the exercise of warrants (the “Warrant Shares”).
(3)For purposes of this table, we have assumed that, after completion of the offering, all of the shares covered by this prospectus will be sold by the selling stockholders. The number of securities beneficially owned post-offering assumes the exercise of the warrants and acquisition and sale of the Warrant Shares in compliance with the terms of the warrants.
(4)Mitchell P. Kopin (“Mr. Kopin”) and Daniel B. Asher (“Mr.Asher”), each of whom are managers of Intracoastal Capital LLC (“Intracoastal”), have shared voting control and investment discretion over the securities reported herein that are held by Intracoastal. As a result, each of Mr. Kopin and Mr. Asher may be deemed to have beneficial ownership (as determined under Section 13(d) of the Exchange Act) of the securities reported herein that are held by Intracoastal. In the aggregate, Intracoastal may be deemed to have beneficial ownership (as determined under Section 13(d) of the Exchange Act) of 1,070,102 of our ordinary shares, which consists of (i) 333,333 of our ordinary shares and (ii) 736,769 of our ordinary shares issuable upon exercise of warrants (166,667 offered in this prospectus).
Mr. Asher, who is a manager of Intracoastal, is also a control person of a broker-dealer. As a result of such common control, Intracoastal may be deemed to be an affiliate of a broker-dealer. Intracoastal acquired the ordinary shares being registered hereunder in the ordinary course of business, and at the time of the acquisition of the ordinary shares and warrants described herein, Intracoastal did not have any arrangements or understandings with any person to distribute such securities.
(5)

Empery Asset Management LP, the authorized agent of Empery Asset Master Ltd (“EAM”), has discretionary authority to vote and dispose of the shares held by EAM and may be deemed to be the beneficial owner of

these shares. Martin Hoe and Ryan Lane, in their capacity as investment managers of Empery Asset Management LP, may also be deemed to have investment discretion and voting power over the shares held by EAM. EAM, Mr. Hoe and Mr. Lane each disclaim any beneficial ownership of EAM’s address is c/o Empery Asset Management, LP, 1 Rockefeller Plaza, Suite 1205, New York, New York 10020.
(6)Empery Asset Management LP, the authorized agent of Empery Tax Efficient, LP (“ETE”), has discretionary authority to vote and dispose of the shares held by ETE and may be deemed to be the beneficial owner of these shares. Martin Hoe and Ryan Lane, in their capacity as investment managers of Empery Asset Management LP, may also be deemed to have investment discretion and voting power over the shares held by ETE. ETE, Mr. Hoe and Mr. Lane each disclaim any beneficial ownership of ETE’s address is c/o Empery Asset Management, LP, 1 Rockefeller Plaza, Suite 1205, New York, New York 10020.
(7)Empery Asset Management LP, the authorized agent of Empery Tax Efficient II, LP (“ETE II”), has discretionary authority to vote and dispose of the shares held by ETE II and may be deemed to be the beneficial owner of these shares. Martin Hoe and Ryan Lane, in their capacity as investment managers of Empery Asset Management LP, may also be deemed to have investment discretion and voting power over the shares held by ETE II. ETE II, Mr. Hoe and Mr. Lane each disclaim any beneficial ownership of these shares ETE II’s address is c/o Empery Asset Management, LP, 1 Rockefeller Plaza, Suite 1205, New York, New York 10020.
(8)The selling stockholder is a broker-dealer. The selling stockholder acquired the securities as compensation for investment banking services. Steven Urbach has voting and dispositive power over the securities held by the selling stockholder.
(9)The selling stockholder is an affiliate of a broker-dealer. The selling stockholder purchased the securities in the ordinary course of business, and at the time of the purchase of the securities, did not have any agreements or understandings, directly or indirectly, with any purchaser to distribute the securities.
(10)Monroe Capital, LLC (“Monroe”) has discretionary authority to vote and dispose of the shares held by Monroe and may be deemed to be the beneficial owner of these shares. Mark B. Fisher, in his capacity as Managing Member of Monroe, may also be deemed to have investment discretion and voting power over the shares held by Monroe. Monroe’s address is 300 West 41st Street, Suite 301, Miami Beach, FL 33140.

DESCRIPTION OF CAPITAL STOCK

We are authorized to issue 200,000,000 shares of common stock, par value $0.0005 per share, and 10,000,000 shares of preferred stock, par value $0.0001 per share.

Common Stock

We are authorized to issue 200,000,000 shares of common stock, par value $0.0005 per share. The holders of common stock are entitled to one vote per share on all matters submitted to a vote of shareholders,stockholders, including the election of directors. There is no cumulative voting in the election of directors. In the event of our liquidation or dissolution, holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities and the liquidation preferences of any outstanding shares of preferred stock. Holders of common stock have no preemptive rights and have no right to convert their common stock into any other securities and there are no redemption provisions applicable to our common stock.

The holders of common stock are entitled to any dividends that may be declared by the Board of Directors out of funds legally available for payment of dividends subject to the prior rights of holders of preferred stock and any contractual restrictions we have against the payment of dividends on common stock. We have not paid dividends on our common stock since inception and do not plan to pay dividends on our common stock in the foreseeable future.

As of August 11, 2015, IDINovember 30, 2016, we had 15,467,28653,230,621 shares of common stock outstanding. In addition, IDI haswe have entered agreements pursuant to which, subject to certain vesting and delivery conditions, IDIwe may issue an additional 900,108 shares of common stock subject to the achievement of performance milestones and 5,056,50017,033,336 shares of common stock underlying restricted stock units and stock options.

Preferred Stock

We are authorized to issue 10,000,000 shares of “blank check” preferred stock with designations, rights and preferences as may be determined from time to time by our Board of Directors. As of August 11, 2015,December 15, 2016, we had 4,965,302no shares of our Series A Convertible Preferred Stock (“Series A”) issued and outstanding which, when convertible, converts into our commonany class of preferred stock on a one-for-one basis. In addition, IDI may issue an additional 1,800,220 shares of Series A subject to the achievement of performance milestones.outstanding.

For a description of how future issuances of our preferred stock could affect the rights of our shareholders,stockholders, see “Certain Provisions of Delaware Law and of Our Charter and Bylaws - Bylaws—Issuance of “blank check”blank check Preferred Stock,” below.

Transfer Agent

We have appointed Continental Stock Transfer & Trust as our transfer agent. Their contact information is: 17 Battery Place, New York, NY 10004, phone number (212) 845-3249, www.continentalstock.com.

CERTAIN PROVISIONS OF DELAWARE LAW AND OF OUR CHARTER AND BYLAWS

Anti-takeover Provisions

In general, Section 203 of the Delaware General Corporations Law or the DGCL prohibits a Delaware corporation with a class of voting stock listed on a national securities exchange or held of record by 2000 or more shareholdersstockholders from engaging in a “business combination” with an “interested shareholder” for a three-year period following the time that this shareholder becomes an interested shareholder, unless the business combination is approved in a prescribed manner. A “business combination” includes, among other things, a merger, asset or stock sale or other transaction resulting in a financial benefit to the interested shareholder. An “interested shareholder” is a person who, together with affiliates and associates, owns, or did own within three years prior to

the determination of interested shareholder status, 15% or more of the corporation’s voting stock. Under Section 203, a business combination between a corporation and an interested shareholder is prohibited unless it satisfies one of the following conditions:

 

before the shareholder became interested, the board of directors approved either the business combination or the transaction which resulted in the shareholder becoming an interested shareholder;

 

upon consummation of the transaction which resulted in the shareholder becoming an interested shareholder, the interested shareholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, shares owned by persons who are directors and also officers, and employee stock plans, in some instances; or

 

at or after the time the shareholder became interested, the business combination was approved by the board of directors of the corporation and authorized at an annual or special meeting of the shareholdersstockholders by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested shareholder.

The DGCL permits a corporation to opt out of, or choose not to be governed by, its anti-takeover statute by expressly stating so in its original certificate of incorporation (or subsequent amendment to its certificate of incorporation or bylaws approved by its shareholders)stockholders). IDI’sCogint’s Certificate of Incorporation contains a provision expressly opting out of the application of Section 203 of the DGCL; therefore the anti-takeover statute does not apply to us.

Issuance of “blank check” preferred stock

Our Certificate of Incorporation authorizes the issuance of up to 10,000,000 shares of “blank check” preferred stock with designations, rights and preferences as may be determined from time to time by our Board of Directors. Our Board is empowered, without shareholder approval, to issue a series of preferred stock with dividend, liquidation, conversion, voting or other rights which could dilute the interest of, or impair the voting power of, our common shareholders.stockholders. The issuance of a series of preferred stock could be used as a method of discouraging, delaying or preventing a change in control. For example, it would be possible for our Board of Directors to issue preferred stock with voting or other rights or preferences that could impede the success of any attempt to effect a change in control of our company.

Our Bylaws also allow our Board of Directors to fix the number of directors. Our shareholdersstockholders do not have cumulative voting in the election of directors.

Special Shareholder Meetings and Action by Written Consent

Under our Bylaws, the Chairperson of our Board of Directors, our President and a majority of the members of the Board of Directors may each call a special meeting of shareholders.stockholders. Our Bylaws do not permit meetings of shareholdersstockholders to be called by any other person. Our Certificate of Incorporation specifically prohibits action by our shareholdersstockholders by written consent without a meeting of shareholders.stockholders.

Any aspect of the foregoing, alone or together, could delay or prevent unsolicited takeovers and changes in control or changes in our management.

Indemnification of Directors and Officers.

Section 145(a) of the DGCL, which IDI is subject to, provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful. Section 145(b) of the DGCL provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper. To the extent that a present or former director or officer of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections (a) and (b) of Section 145 of the DGCL, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith.

Any indemnification under subsections (a) and (b) of Section 145 of the DGCL (unless ordered by a court) shall be made by IDI only as authorized in the specific case upon a determination that indemnification of the present or former director, officer, employee or agent is proper in the circumstances because the person has met the applicable standard of conduct set forth in subsections (a) and (b) of Section 145. Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (1) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, or (3) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion, or (4) by the shareholders. Expenses (including attorneys’ fees) incurred by an officer or director in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or

officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation as authorized in this section. Such expenses (including attorneys’ fees) incurred by former directors and officers or other employees and agents may be so paid upon such terms and conditions, if any, as the corporation deems appropriate. The indemnification and advancement of expenses provided by, or granted pursuant to, Section 145 shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of shareholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office.

Section 145 of the DGCL also empowers a corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the corporation would have the power to indemnify such person against such liability under Section 145.

Article 6 of IDI’s Bylaws provide that directors, officers, employees and agents shall be indemnified to the fullest extent permitted by the DGCL. Article 10 of IDI’s Certificate of Incorporation also provides that directors shall be indemnified to the fullest extent permitted by the DGCL.

IDI carries directors and officers liability coverages designed to insure its officers and directors and those of its subsidiaries against certain liabilities incurred by them in the performance of their duties, and also providing for reimbursement in certain cases to IDI and its subsidiaries for sums paid to directors and officers as indemnification for similar liability. IDI has entered into Indemnification Agreements with its executive officers and directors providing for advancement of expenses and indemnification to the fullest extent permissible under DGCL.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, IDI has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.

PLAN OF DISTRIBUTION

The selling shareholderstockholders and any of the selling shareholder’sstockholders’ pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their securities covered hereby on the principal Trading Market or any other

stock exchange, market or trading facility on which the securities are traded or in private transactions. These sales may be at fixed or negotiated prices. The selling shareholderstockholders may use any one or more of the following methods when selling securities:

 

ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;

block trades in which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction;

 

block trades in which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction;

 

purchases by a broker-dealer as principal and resale by the broker-dealer for its account;

 

an exchange distribution in accordance with the rules of the applicable exchange;

 

privately negotiated transactions;

 

settlement of short sales;

in transactions through broker-dealers that agree with the selling shareholderstockholders to sell a specified number of such securities at a stipulated price per security;

through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;

 

a combination of any such methods of sale; or

 

any other method permitted pursuant to applicable law.

The selling shareholderstockholders may also sell securities under Rule 144 under the Securities Act, if available, rather than under this prospectus.

Broker-dealers engaged by the selling shareholderstockholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the selling shareholderstockholders (or, if any broker-dealer acts as agent for thea purchaser of securities, from the purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a customary brokerage commission in compliance with FINRA Rule 2440; and in the case of a principal transaction a markup or markdown in compliance with FINRA IM-2440.

In connection with the sale of the securities or interests therein, the selling shareholderstockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the securities in the course of hedging the positions they assume. The selling shareholderstockholders may also sell securities short and deliver these securities to close out their short positions, or loan or pledge the securities to broker-dealers that in turn may sell these securities. The selling shareholderstockholders may also enter into option or other transactions with broker-dealers or other financial institutions or create one or more derivative securities which require the delivery to such broker-dealer or other financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).

The selling shareholderstockholders and any broker-dealers or agents that are involved in selling the securities may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act. TheEach selling shareholder has informed the Company that it does not have any written or oral agreement or understanding, directly or indirectly, with any person to distribute the securities.

The Company is required to pay certain fees and expenses incurred by the Company incident to the registration of the securities. The Company has agreed to indemnify the selling shareholderstockholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.

We agreed to keep this prospectus effective until the earlier of (i) the date on which the securities may be resold by the selling shareholderstockholders without registration and without regard to any volume or manner-of-sale limitations by reason of Rule 144, without the requirement for the Company to be in compliance with the current public information under Rule 144 under the Securities Act or any other rule of similar effect or (ii) all of the securities have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule of similar effect. The resale securities will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale securities covered hereby may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.

Under applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not simultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of the distribution. In addition, the selling shareholderstockholders will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of the common stock by the selling shareholderstockholders or any other person. We will make copies of this prospectus available to the selling shareholderstockholders and have informed the selling shareholderstockholders of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with Rule 172 under the Securities Act).

LEGAL MATTERS

The validity of the securities offered hereby will be passed upon for us by Nason, Yeager, Gerson, White & Lioce, P.A., West Palm Beach,Akerman LLP, Fort Lauderdale, Florida. One of the firm’s employees who is not providing services relating to this offering owns 20,000 shares of our common stock.

EXPERTS

The audited financial statements and management’s assessment of the effectiveness of internal control over financial reporting incorporated by reference in this prospectus and elsewhere in the registration statement have been so incorporated by reference in reliance upon the reports of Grant Thornton LLP, independent registered public accountants, upon the authority of said firm as experts in accounting and auditing.

The consolidated financial statements of IDI Inc.Holdings, LLC incorporated by reference in thisthe accompanying prospectus and registration statement for the years endedperiod from September 22, 2014 (inception) through December 31, 2014 and 2013 have been audited by Marcum Bernstein & PinchukRBSM LLP, an independent registered public accounting firm, as set forth in their reportsreport incorporated by reference, and are included in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

The audited historical consolidated financial statements of IDI Holdings incorporated by referenceFluent, Inc., which include: (1) the consolidated balance sheet as of December 8, 2015 and the related consolidated statements of net loss and comprehensive loss, changes in this prospectusstockholders’ equity and registration statementcash flows for the period from September 22, 2014 (inception)January 1, 2015 through December 8, 2015 included as an exhibit to our Annual Report on Form 10-K dated March 18, 2016 and (2) the consolidated balance sheet as of December 31, 2014 and the related consolidated statements of income and comprehensive income, changes in stockholders’ equity and cash flows for the year then ended included as an exhibit to our Current Report on Form 8-K dated December 2, 2015, have been so incorporated in reliance on the reports of EisnerAmper LLP, independent registered public accountants, given on the authority of said firm as experts in auditing and accounting.

The consolidated financial statements of Fluent, Inc. and subsidiaries as of December 31, 2013 and for the year ended December 31, 2013 included as an exhibit to our Current Report on Form 8-K dated December 2, 2015 have been audited by L.L. BradfordErnst & Company, LLC, anYoung LLP, independent registered public accounting firm, as set forth in their reportsreport thereon included therein, and incorporated herein by reference. Such financial statements have been incorporated herein by reference and are included in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

The documents listed below areSEC allows us to “incorporate by reference” the information we file with it, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference intois an important part of this registration statement:prospectus, and information that we file later with the SEC will automatically update and supersede this information. We incorporate by reference the following documents filed with the SEC:

 

Our annual report on Form 10-K for the year ended December 31, 2014 filed on April 15, 2015;

The information specifically incorporated by reference into our Annual Report on Form 10-K for the year ended December 31, 2014 from2015, filed with the SEC on March 18, 2016, and the portions of our Definitive Proxy Statementproxy statement on Schedule 14A for our 2016 Annual Meeting of Stockholders filed with the SEC on April 30, 2015;29, 2016 that are incorporated by reference therein;

 

Our quarterly reportour Quarterly Report on Form 10-Q for the quarterquarterly period ended March 31, 2015, as amended,2016, filed with the SEC on May 27, 2015 and 5, 2016

our quarterly reportQuarterly Report on Form 10-Q for the quarterquarterly period ended June 30, 2015, filed on August 14, 2015;

Our current reports on Form 8-K filed on March 26, 2015 (as amended by the Form 8-K/A filed July 10, 2015), May 1, 2015, May 20, 2015, May 27, 2015, June 1, 2015, June 4, 2015, June 22, 2015, July 2, 2015, July 15, 2015 and July 28, 2015, and our reports on Form 6-K filed February 13, 2015 and March 17, 2015 (other than information furnished pursuant to Items 2.02 and 7.01 of Form 8-K and any related exhibits);

The description of our common stock in our registration statement on Form F-32016, filed with the SEC on August 8, 2016;

our Quarterly Report on Form 10-Q for the quarterly period ended September 1, 2011, as updated by30, 2016, filed with the current reportSEC on November 3, 2016;

our Current Reports on Form 8-K filed with the SEC on March 26,December 2, 2015 (only as to the consolidated financial statements of Fluent, Inc. as of and any amendments and reports filed for the purpose of updating such description;years ended December 31, 2013 and December 31,

2014), January 15, 2016, January 19, 2016, February 29, 2016, March 15, 2016, March 17, 2016, April 4, 2016, May 18, 2016, May 23, 2016, June 6, 2016, June 8, 2016, July 1, 2016, July 8, 2016, August 10, 2016, September 14, 2016, September 26, 2016, October 6, 2016, and November 23, 2016; and

 

description of our capital stock contained in our registration statement on Form 8-A filed on September 26, 2016 and our registration statement on Form S-3 filed on June 17, 2016.

All reports and other documents that we subsequently filedfile pursuant to SectionsSection 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) prior to the termination of thethis offering, other thanbut excluding any information furnished pursuant to, Items 2.02 and 7.01 of Form 8-K and any related exhibits, shall be deemed torather than filed with, the SEC, will also be incorporated by reference into the prospectus.

Any statement contained in a document incorporated orthis prospectus and deemed to be part of this prospectus from the time of the filing of such reports and documents.

This prospectus as further supplemented may contain information that updates, modifies or is contrary to information in one or more of the documents incorporated by reference in this prospectus. You should rely only on the information incorporated by reference or provided in this prospectus. We have not authorized anyone else to provide you with different information. You should not assume that the information in this prospectus is accurate as of any date other than the date of this prospectus or the date of the documents incorporated by reference in this prospectus, is modified or superseded for purposes of the prospectus to the extent that a statement contained in this prospectus or in any other subsequently filed document that also is or is deemed to be incorporated by reference herein modifies or supersedes such statement.respectively.

We will provide without charge to each person, including any beneficial owner, to whom athis prospectus is delivered, upon written or oral request, a copy of any or all of the informationdocuments that has beenare incorporated by reference ininto this prospectus, but not delivered with the prospectus.

Weprospectus, other than exhibits to such documents unless such exhibits are an Exchange Act reporting company and are required to file periodic reports on Form 10-K and 10-Q and current reports on Form 8-K.specifically incorporated by reference into the documents that this prospectus incorporates. You may read and copy all or any portion of the registration statement or any other information, which we file at the SEC’s public reference room at 100 F Street, N.E.should direct written requests to: Cogint, Inc., Washington, DC 20549, Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference room. Also, the SEC maintains an internet site that contains reports, proxy and information statements, and other information that we file electronically with the SEC, including the registration statement. The website address iswww.sec.gov.

You may obtain a copy of any of our filings, at no cost, by writing or telephoning us at:

Attn: Legal Department, 2650 North Military Trail, Suite 300,

Boca Raton, Florida 33431, or you may call us at (561) 757-4000.

Attention: Corporate Secretary

(561) 757-4000

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Other Expenses of Issuance and Distribution.

The following table sets forth the costs and expenses payable by us in connection with the issuance and distribution of the securities being registered hereunder. No expenses shall be borne by the selling shareholder.stockholders. All of the amounts shown are estimates, except for the SEC Registration Fees.

 

SEC registration fees

  $567    $572  

Printing expenses

  $1,000   $5,000  

Accounting fees and expenses

  $10,000    $45,000  

Legal fees and expenses

  $5,000   $25,000  
  

 

   

 

 

Total

  $16,567    $75,572  
  

 

   

 

 

Indemnification of Directors and Officers.

Section 145(a) of the DGCL, which IDICogint is subject to, provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful. Section 145(b) of the DGCL provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper. To the extent that a present or former director or officer of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections (a) and (b) of Section 145 of the DGCL, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith.

Any indemnification under subsections (a) and (b) of Section 145 of the DGCL (unless ordered by a court) shall be made by IDICogint only as authorized in the specific case upon a determination that indemnification of the present or former director, officer, employee or agent is proper in the circumstances because the person has met the applicable standard of conduct set forth in subsections (a) and (b) of Section 145. Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (1) by a majority

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vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (2) by a

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committee of such directors designated by majority vote of such directors, even though less than a quorum, or (3) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion, or (4) by the shareholders.stockholders. Expenses (including attorneys’ fees) incurred by an officer or director in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation as authorized in this section. Such expenses (including attorneys’ fees) incurred by former directors and officers or other employees and agents may be so paid upon such terms and conditions, if any, as the corporation deems appropriate. The indemnification and advancement of expenses provided by, or granted pursuant to, Section 145 shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of shareholdersstockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office.

Section 145 of the DGCL also empowers a corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the corporation would have the power to indemnify such person against such liability under Section 145.

Article 6 of IDI’sCogint’s Bylaws provide that directors, officers, employees and agents shall be indemnified to the fullest extent permitted by the DGCL. Article 10 of IDI’sCogint’s Certificate of Incorporation also provides that directors shall be indemnified to the fullest extent permitted by the DGCL.

IDICogint carries directors and officers liability coverages designed to insure its officers and directors and those of its subsidiaries against certain liabilities incurred by them in the performance of their duties, and also providing for reimbursement in certain cases to IDICogint and its subsidiaries for sums paid to directors and officers as indemnification for similar liability. IDICogint has entered into Indemnification Agreements with its executive officers and directors providing for advancement of expenses and indemnification to the fullest extent permissible under DGCL.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, IDICogint has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.

Exhibits and Financial Statement Schedules.

 

Exhibit
No.

  

Description

     2.1  Merger Agreement and Plan of Reorganization by and among The Best One, Inc., Tiger Media, Inc., TBO Acquisition, LLC, and Derek Dubner, solely in his capacity as representative, dated December 14, 2014 (incorporated by reference to Exhibit 4.1 to IDI’sCogint, Inc.’s current report on Form 6-K filed December 18, 2014)
     2.2  First Amendment to Merger Agreement and Plan of Reorganization by and among The Best One, Inc., Tiger Media, Inc., TBO Acquisition, LLC, and Derek Dubner, solely in his capacity as representative, dated December 18, 2014 (incorporated by reference to Exhibit 4.2 to IDI’sCogint, Inc.’s current report on Form 6-K filed December 18, 2014)

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Exhibit No.

Description

     2.3  Second Amendment to Merger Agreement and Plan of Reorganization by and among The Best One, Inc., Tiger Media, Inc., TBO Acquisition, LLC, and Derek Dubner, solely in his capacity as representative, dated February 13, 2015 (incorporated by reference to Exhibit 4.1 to IDI’sCogint, Inc.’s current report on Form 6-K filed on February 13, 2015)

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     2.4  Asset Purchase Agreement by and between Tiger Media, Inc. and Symbol Media (incorporated by reference to Exhibit 99.2 of the Schedule 13D filed by Tan Wei Han on June 26, 2013)
     2.5  CertificateAgreement and Plan of OwnershipMerger dated as of November 16, 2015, by and Merger Merging IDI,among Cogint, Inc., a Delaware corporation, withFluent, Inc., the existing stockholders of Fluent, Inc., Fluent Acquisition I, Inc., Fluent Acquisition II, LLC and into Tiger Media, Inc., a Delaware CorporationRyan Schulke, solely in his capacity as representative of Sellers. (incorporated by reference to Exhibit 3.12.1 to IDI’s current reportCogint, Inc.’s Current Report on Form 8-K filed MayNovember 19, 2015).
     2.6Amendment No. 1 to Agreement and Plan of Merger dated December 8, 2015, by and among Cogint, Inc., Fluent, Inc., the existing stockholders of Fluent, Inc., Fluent Acquisition I, Inc., Fluent Acquisition II, LLC and Ryan Schulke, solely in his capacity as representative of Sellers (incorporated by reference to Exhibit 2.2 to Cogint, Inc.’s Current Report on Form 8-K filed December 10, 2015).
     2.7Membership Interest Purchase Agreement dated June 8, 2016, by and among Selling Source, LLC and Cogint, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed June 8, 2016).
     4.1  Form of Common Stock Certificate (incorporated by reference to Exhibit 4.1 of the Registrant’s Registration StatementCompany’s Current Report on Form S-3 (File No. 333-205614))8-K filed September 26, 2016).
     4.2  Warrant issued to Intracoastal Capital, LLC, as amended, dated July 23, 2015 (incorporated by reference to Exhibit 4.2 to the Company’s Quarterly Report on Form 10-Q filed November 16, 2015).
     4.3Securities Purchase Agreement dated as of November 16, 2015, by and between Cogint, Inc. and Frost Gamma Investments Trust (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed November 19, 2015).
     4.4Warrant issued to Frost Gamma Investments Trust, dated as of Tiger Media,November 16, 2015 (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed November 19, 2015).
     4.5Stock Purchase Agreement dated as of November 16, 2015, by and between Cogint, Inc. and Frost Gamma Investments Trust (incorporated by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K filed November 19, 2015).
     4.6Warrant issued to Whitehorse Finance, Inc., dated as of December 8, 2015 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed December 10, 2015), as amended in September 30, 2016 (incorporated by reference to Exhibit 4.1 to the Company’s Form 8-K filed October 6, 2016).
     4.7Warrant issued to H.I.G. Whitehorse SMA ABF, Inc., dated as of December 8, 2015 (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed December 10, 2015), as amended in September 30, 2016 (incorporated by reference to Exhibit 4.1 to the Company’s Form 8-K filed October 6, 2016).
     4.8Warrant issued to Whitehorse Holdings II, LLC, dated as of December 8, 2015 (incorporated by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K filed December 10, 2015), as amended in September 30, 2016 (incorporated by reference to Exhibit 4.1 to the Company’s Form 8-K filed October 6, 2016).

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Exhibit No.

Description

     4.9Promissory Note made by Cogint, Inc. in favor of Frost Gamma Investments Trust, dated as of December 8, 2015, with accompanying Fee Letter (incorporated by reference to Exhibit 4.4 of the Company’s Current Report on Form 8-K filed December 10, 2015).
     4.10Promissory Note made by Cogint, Inc. in favor of Michael Brauser, dated as of December 8, 2015, with accompanying Fee Letter (incorporated by reference to Exhibit 4.5 of the Registrant’s Registration StatementCompany’s Current Report on Form S-4 (File No. 333-158336))8-K filed December 10, 2015).
     4.34.11Promissory Note made by Cogint, Inc. in favor of Barry Honig, dated as of December 8, 2015, with accompanying Fee Letter (incorporated by reference to Exhibit 4.6 of the Company’s Current Report on Form 8-K filed December 10, 2015).
     4.12Subordination Agreement, dated December 8, 2015, by and among Cogint, Inc., Fluent, LLC, substantially all of the direct and indirect subsidiaries of Cogint, Inc., Frost Gamma Investments Trust, Michael Brauser, Barry Honig, and Whitehorse Finance, Inc. (incorporated by reference to Exhibit 4.7 of the Company’s Current Report on Form 8-K filed December 10, 2015).
     4.13Stockholders’ Agreement, dated as of December 8, 2015, by and among Cogint, Inc., the selling stockholders of Fluent, Inc., Frost Gamma Investments Trust, James Reilly, Derek Dubner, Marlin Capital Investments, LLC, and Michael Brauser. (incorporated by reference to Exhibit 4.8 to the Company’s Current Report on Form 8-K filed December 10, 2015).
     4.14Registration Rights Agreement, dated as of December 8, 2015, by and among Cogint, Inc. and the selling stockholders of Fluent, Inc. (incorporated by reference to Exhibit 4.9 to the Company’s Current Report on Form 8-K filed December 10, 2015).
     4.15  Form of New Warrant dated as(incorporated by reference to Exhibit 4.2 to the Company’s Current Report or Form 8-K filed October 6, 2016).
     4.16Form of July 23, 2015Purchaser’s Warrant (incorporated by reference to Exhibit 4.1 ofto the Registrant’s current reportCompany’s Current Report on Form 8-K filed July 28, 2015)November 23, 2016).
     4.17Form of Chardan Capital Warrant (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed May 18, 2016).
     5.1  Legal Opinion of Nason, Yeager, Gerson, WhiteAkerman LLP*
   23.1Consent of Grant Thornton LLP*
   23.2Consent of RBSM LLP*
   23.3Consent of EisnerAmper LLP*
   23.4Consent of Ernst & Lioce, P.A.Young LLP*
   23.5Consent of Akerman LLP (included in Exhibit 5.1)*
23.1   24.1  ConsentPower of Marcum Bernstein & Pinchuk LLP*Attorney (included on signature pages herein)*
23.2 101.INS  Consent of L.L. Bradford & Company, LLC*XBRL Instance Document.**
23.3 101.SCH  Consent of Nason, Yeager, Gerson, White & Lioce, P.A. (included in Exhibit 5.1)XBRL Taxonomy Extension Schema Document.**
 101.CALXBRL Taxonomy Extension Calculation Linkbase Document.**
 101.DEFXBRL Taxonomy Extension Definition Linkbase Document.**
 101.LABXBRL Taxonomy Extension Label Linkbase Document.**
 101.PREXBRL Taxonomy Extension Presentation Linkbase Document.**

 

*Filed herewith
**Filed as exhibits to the Company’s Form 10-K for the year ended December 31, 2015 and Form 10-Q for the quarter ended September 30, 2016, filed on March 18, 2016 and November 3, 2016, respectively, with corresponding exhibit numbers, and incorporated herein by reference.

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Undertakings

The undersigned registrant hereby undertakes:

To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement;

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

(i)To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change in such information in the registration statement;

provided, however, that paragraphs (i), (ii) and (iii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.

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That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initialbona fide offering thereof.

To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

(A) Each prospectus filed by a registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

(B) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5) or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which the prospectus relates, and the offering of such securities at that time shall be deemed to be the initialbona fide offering thereof.Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.

That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of

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securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

That, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initialbona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

 

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SIGNATURES

In accordance withPursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Boca Raton, State of Florida, on August 14, 2015.December 16, 2016.

 

IDI,COGINT, Inc.
By: 

/s/ Michael Brauser

 Michael Brauser
 Executive Chairman

In accordanceKNOW ALL MEN BY THESE PRESENT, that each person whose signature appears below constitutes and appoints each of Michael Brauser and Derek Dubner his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments to this Form S-3, and to file the same, with all exhibits thereto and other documents in connection therewith with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each and every act or things requisite and necessary to be done in and about the premises, as fully and to all intents and purposes as he might or could do in person hereby ratifying and confirming all that said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities and on the dates indicated.indicated:

 

Signature

  

Title

 

Date

/s/ Michael Brauser

Michael Brauser

  

Executive Chairman and Director

(Principal Executive Officer)

 August 14 2015December 16, 2016

/s/ Peter BenzDr. Phillip Frost

Dr. Phillip Frost

  Director

Vice Chairman

 August 14, 2015
Peter BenzDecember 16, 2016

/s/ Daniel BrauserMacLachlan

DirectorAugust 14, 2015

Daniel Brauser

/s/ Derek Dubner

DirectorAugust 14, 2015
Derek Dubner

/s/ Robert Fried

DirectorAugust 14, 2015
Robert Fried

/s/ Steven Rubin

DirectorAugust 14, 2015
Steven Rubin

/s/ Robert Swayman

DirectorAugust 14, 2015
Robert Swayman

/s/ Aaron Solomon

Aaron SolomonMacLachlan

  

Interim Chief Financial Officer

(Principal Financial Officer)

 August 14, 2015December 16, 2016

/s/ Jacky Wang

Jacky Wang

  

Chief Accounting Officer

(Principal Accounting Officer)

 August 14, 2015December 16, 2016

/s/ Derek Dubner

Derek Dubner

Chief Executive Officer and Director

December 16, 2016

/s/ Ryan Schulke

Ryan Schulke

Director

December 16, 2016

/s/ Robert N. Fried

Robert N. Fried

Director

December 16, 2016

/s/ Steven D. Rubin

Steven D. Rubin

Director

December 16, 2016

 

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/s/ Robert Swayman

Robert Swayman

Director

December 16, 2016

/s/ Peter Benz

Peter Benz

Director

December 16, 2016

/s/ Donald Mathis

Donald Mathis

Director

December 16, 2016

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EXHIBIT INDEX

 

Exhibit
No.

  

Exhibit Description

  5.1  Legal Opinion of Nason, Yeager, Gerson, White & Lioce, P.A.Akerman LLP
23.1  Consent of Marcum Bernstein & PinchukGrant Thornton LLP
23.2  Consent of L.L. Bradford & Company, LLCRBSM LLP
23.3  Consent of Nason, Yeager, Gerson, WhiteEisnerAmper LLP
23.4Consent of Ernst & Lioce, P.A.Young LLP
23.5Consent of Akerman LLP (included in Exhibit 5.1)
24.1Power of Attorney (included on signature pages herein)

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