Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Aug. 09, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | Remark Holdings, Inc. | |
Entity Central Index Key | 1,368,365 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Outstanding (shares) | 22,653,322 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Assets | ||
Cash and cash equivalents | $ 7,209 | $ 6,893 |
Restricted cash | 9,406 | 9,405 |
Trade accounts receivable | 672 | 1,372 |
Prepaid expense and other current assets | 3,672 | 3,323 |
Notes receivable, current | 190 | 181 |
Total current assets | 21,149 | 21,174 |
Restricted cash | 2,250 | 2,250 |
Notes receivable | 0 | 190 |
Property and equipment, net | 14,646 | 15,531 |
Investment in unconsolidated affiliate | 1,030 | 1,030 |
Intangibles, net | 34,303 | 37,406 |
Goodwill | 26,775 | 26,763 |
Other long-term assets | 1,168 | 1,355 |
Total assets | 101,321 | 105,699 |
Liabilities and Stockholders’ Equity | ||
Accounts payable | 13,559 | 16,546 |
Accrued expense and other current liabilities | 12,801 | 13,965 |
Deferred merchant booking | 12,198 | 6,991 |
Deferred revenue | 6,436 | 4,072 |
Note payable | 3,000 | 0 |
Current maturities of long-term debt | 37,871 | 100 |
Capital lease obligations | 0 | 179 |
Total current liabilities | 85,865 | 41,853 |
Long-term debt, less current portion and net of debt issuance cost | 0 | 37,825 |
Warrant liability | 16,701 | 25,030 |
Other liabilities | 3,631 | 3,591 |
Total liabilities | 106,197 | 108,299 |
Commitments and contingencies (Note 13) | ||
Preferred stock, $0.001 par value; 1,000,000 shares authorized; none issued | 0 | 0 |
Common stock, $0.001 par value; 100,000,000 shares authorized; 22,653,222 and 22,232,004 shares issued and outstanding; each at June 30, 2017 and December 31, 2016, respectively | 23 | 22 |
Additional paid-in-capital | 192,591 | 190,507 |
Accumulated other comprehensive loss | (44) | (16) |
Accumulated deficit | (197,446) | (193,113) |
Total stockholders’ equity (deficit) | (4,876) | (2,600) |
Total liabilities and stockholders’ equity | $ 101,321 | $ 105,699 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (shares) | 100,000,000 | 50,000,000 |
Common stock, shares issued (shares) | 22,653,322 | 22,232,004 |
Common stock, shares outstanding (shares) | 22,653,322 | 22,232,004 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Statement [Abstract] | ||||
Revenue, net | $ 17,256 | $ 14,975 | $ 32,555 | $ 29,229 |
Cost and expense | ||||
Cost of revenue (excluding depreciation and amortization) | 3,965 | 2,624 | 6,629 | 4,973 |
Sales and marketing | 5,774 | 4,934 | 11,649 | 10,462 |
Technology and development | 884 | 434 | 1,792 | 838 |
General and administrative | 8,359 | 7,910 | 16,685 | 16,330 |
Depreciation and amortization | 2,894 | 2,479 | 5,755 | 4,876 |
Other operating expense | 57 | 97 | 102 | 429 |
Total cost and expense | 21,933 | 18,478 | 42,612 | 37,908 |
Operating loss | (4,677) | (3,503) | (10,057) | (8,679) |
Other income (expense) | ||||
Interest expense | (1,181) | (1,215) | (2,199) | (2,425) |
Other income, net | 1 | 1 | 20 | 30 |
Change in fair value of warrant liability | 1,760 | (647) | 8,329 | 3,338 |
Other loss | (21) | (68) | (52) | (71) |
Total other income (expense), net | 559 | (1,929) | 6,098 | 872 |
Loss before income taxes | (4,118) | (5,432) | (3,959) | (7,807) |
Provision for income taxes | (190) | 0 | (374) | 0 |
Net loss | $ (4,308) | $ (5,432) | $ (4,333) | $ (7,807) |
Weighted-average shares outstanding, basic and diluted (in shares) | 22,637 | 20,069 | 22,553 | 19,903 |
Net loss per share, basic and diluted (usd per share) | $ (0.19) | $ (0.27) | $ (0.19) | $ (0.39) |
Unaudited Condensed Consolidat5
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Cash Flows [Abstract] | ||
Net cash provided by (used in) operating activities | $ (2,034) | $ 1,957 |
Cash flows from investing activities: | ||
Purchases of property, equipment and software | (1,785) | (1,469) |
Net cash used in investing activities | (1,785) | (1,469) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock, net | 1,315 | 2,300 |
Proceeds from debt issuance | 3,000 | 0 |
Payments of capital lease obligations | (179) | (182) |
Net cash provided by financing activities | 4,136 | 2,118 |
Net increase in cash, cash equivalents and restricted cash | 317 | 2,606 |
Cash, cash equivalents and restricted cash: | ||
Beginning of period | 18,548 | 17,088 |
End of period | 18,865 | 19,694 |
Supplemental cash flow information: | ||
Cash paid for interest | 1,997 | 1,827 |
Supplemental schedule of non-cash investing and financing activities: | ||
Issuance of common stock upon conversion of debt instruments | $ 121 | $ 0 |
ORGANIZATION AND BUSINESS
ORGANIZATION AND BUSINESS | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND BUSINESS | NOTE 1. ORGANIZATION AND BUSINESS Organization and Business Remark Holdings, Inc. and subsidiaries (“Remark”, “we”, “us”, or “our”) own, operate and acquire innovative digital media properties across multiple verticals, such as travel and entertainment, technology and data intelligence, young adult lifestyle and personal finance, that deliver culturally relevant, dynamic content that attracts and engages users around the world. We leverage our unique digital media assets to target the Millennial demographic, which provides us with access to fast-growing, lucrative markets. Our common stock is listed on the Nasdaq Capital Market under the ticker symbol MARK. Liquidity Considerations During the six months ended June 30, 2017 , and in each fiscal year since our inception, we have incurred net losses and generated negative cash flow from operations, resulting in an accumulated deficit of $197.4 million and a cash and cash equivalents balance of $7.2 million , both amounts as of June 30, 2017 . Also as of June 30, 2017 , we had a negative working capital balance of $64.7 million . Our net revenue during the six months ended June 30, 2017 was $32.6 million . During the six months ended June 30, 2017 , we issued a total of 382,308 shares of our common stock to accredited investors in certain private placements in exchange for approximately $1.3 million in cash. We are a party to a financing agreement dated as of September 24, 2015 (as amended, the “Financing Agreement”) with certain of our subsidiaries as borrowers (together with Remark, the “Borrowers”), certain of our subsidiaries as guarantors (the “Guarantors”), the lenders from time to time party thereto (the “Lenders”) and MGG Investment Group LP, in its capacity as collateral agent and administrative agent for the Lenders (“MGG”), pursuant to which the Lenders initially extended credit to the Borrowers consisting of a term loan in the aggregate principal amount of $27.5 million (the “Loan”). On September 20, 2016, we entered into Amendment No. 1 to Financing Agreement (the “Financing Amendment”) which, among other changes, increased the Loan by $8.0 million to a total aggregate principal amount of $35.5 million . The terms of the Financing Agreement and related documents are described in Note 10 . As of June 30, 2017 , we were not in compliance with the covenant under the Financing Agreement requiring minimum consolidated EBITDA of Remark and its subsidiaries for the trailing twelve-month period ended June 30, 2017 of $(2.7) million , as our actual consolidated EBITDA for such period was $(3.5) million . Also, as of July 13, 2017, we were not in compliance with the covenant under the Financing Agreement requiring a minimum restricted cash balance of $2.25 million , and as of the date of this report, the actual restricted cash balance was $1.56 million . The foregoing instances of non-compliance constitute events of default under the Financing Agreement for which we have not received a waiver as of the date of this report. As a result, the Lenders may declare our obligations under the Financing Agreement, including all unpaid principal and interest, due and payable immediately and exercise such other rights available to them under the Financing Agreement. Our available cash and other liquid assets are not sufficient to pay such obligations in full. We are pursuing discussions with the Lenders with respect to obtaining a waiver under or modifications to the Loan Agreement, but we cannot provide assurance that we will obtain such waiver or modifications. We cannot provide assurance that revenue generated from our businesses will be sufficient to sustain our operations in the long term; therefore, we have implemented measures to reduce operating costs, and we continuously evaluate other opportunities to reduce costs. Additionally, we are actively assessing the sale of certain non-core assets, considering sales of minority interests in certain of our operating businesses, and evaluating potential acquisitions that would provide additional revenue. However, we may need to obtain additional capital through equity financing, debt financing, or by divesting of certain assets or businesses. Conditions in the debt and equity markets, as well as the volatility of investor sentiment regarding macroeconomic and microeconomic conditions, will play primary roles in determining whether we can successfully obtain additional capital. Additionally, pursuant to the Financing Agreement, we are subject to certain limitations on our ability and the ability of our subsidiaries to, among other things, incur additional debt and transfer, sell or otherwise dispose of assets, without the consent of the Lenders. We cannot be certain that we will be successful at raising additional capital. A variety of factors, many of which are outside of our control, affect our cash flow; those factors include regulatory issues, competition, financial markets and other general business conditions. Based on our historical track record and projections, we believe that we will be able to meet our ongoing requirements through June 30, 2018 (including repayment of our existing debt as it matures) with existing cash, cash equivalents and cash resources, and based on the probable success of one or more of the following plans: • monetize existing assets • work with our creditors to modify existing arrangements or refinance our debt • obtain additional capital through equity issuances, including but not limited to equity issuances to Aspire Capital Fund, LLC under its existing purchase commitment (which equity issuances may dilute existing stockholders) However, projections are inherently uncertain and we cannot assure you that we will generate sufficient income and cash flow to meet all of our liquidity requirements. Comparability We reclassified an amount in the December 31, 2016 Consolidated Balance Sheet to conform to the current presentation as of June 30, 2017 . |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES We prepared the accompanying unaudited Condensed Consolidated Balance Sheet as of June 30, 2017 , with the audited Consolidated Balance Sheet amounts as of December 31, 2016 presented for comparative purposes, and the related unaudited Condensed Consolidated Statements of Operations and Statements of Cash Flows in accordance with the instructions for Form 10-Q. In compliance with those instructions, we have omitted certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), though management believes the disclosures made herein are sufficient to ensure that the information presented is not misleading. Our results of operations and our cash flows as of the end of the interim periods reported herein do not necessarily indicate the results we may experience for the remainder of the year or for any other future period. Management believes that we have included all adjustments (including those of a normal, recurring nature) considered necessary to fairly present our unaudited Condensed Consolidated Balance Sheet as of June 30, 2017 , our unaudited Condensed Consolidated Statements of Operations and our unaudited Condensed Consolidated Statements of Cash Flows for all periods presented. You should read our unaudited condensed consolidated interim financial statements and footnotes in conjunction with our consolidated financial statements and footnotes included within our Annual Report on Form 10-K for the year ended December 31, 2016 (the “ 2016 Form 10-K”). Consolidation We include all of our subsidiaries in our consolidated financial statements, eliminating all significant intercompany balances and transactions during consolidation. The equity of certain of our subsidiaries is either partially or fully held by citizens of the country of incorporation to comply with local laws and regulations. Use of Estimates We prepare our consolidated financial statements in conformity with GAAP. While preparing our financial statements, we make estimates and assumptions that affect amounts reported and disclosed in the consolidated financial statements and accompanying notes. Accordingly, actual results could differ from those estimates. On an ongoing basis, we evaluate our estimates, including those related to accounts receivable, intangible assets, the useful lives of property and equipment, stock-based compensation, the fair value of the warrant liability, income taxes, inventory reserve and purchase price allocation, among other items. Changes to Significant Accounting Policies We have made no material changes to our significant accounting policies as reported in our 2016 Form 10-K. Recently Issued Accounting Pronouncements In July 2017, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2017-11, Accounting for Certain Financial Instruments with Down Round Features , which changes how an entity determines whether certain financial instruments should be classified as liabilities or equity instruments. Under ASU 2017-11, a down round feature no longer precludes equity classification when an entity assesses whether the instrument is indexed to the entity's own stock. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. The amendments also require entities to recognize the effect of the down round feature as a dividend when the feature is triggered (which would affect the presentation of earnings per share) and they clarify existing disclosure requirements for equity-classified instruments. We are currently evaluating the impact that application of ASU 2017-11 will have on our consolidated financial statements, results of operations and cash flows. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , which changes GAAP primarily by requiring lessees to recognize, at lease commencement, a lease liability representing the present value of the lessee’s obligation to make lease payments, and a right-of-use asset representing the lessee’s right to use (or control the use of) a specified asset during the lease term, for leases classified as operating leases. For us the amendments in ASU 2016-02 will become effective on January 1, 2019, and early adoption is permitted. We are currently evaluating the impact that application of ASU 2016-02 will have on our consolidated financial statements, results of operations and cash flows. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which outlines a single, comprehensive model for an entity to use to ensure that it recognizes revenue in a manner that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. For us, the amendments in ASU 2014-09 are effective for fiscal years beginning after December 15, 2017, including interim periods therein. Though we do not believe that this guidance will have a material effect upon the financial condition, results of operations, cash flows or reporting thereof for most of our existing subsidiaries, we are evaluating the impact the guidance will have on the business we acquired when we, together with our wholly-owned subsidiary KanKan Limited, completed the acquisition (the “CBG Acquisition”) of assets of China Branding Group Limited (“CBG”) on September 20, 2016, pursuant to the terms of the Second Amended and Restated Asset and Securities Purchase Agreement, dated as of the same date. We have reviewed all recently issued accounting pronouncements. The pronouncements that we have already adopted did not have a material effect on our financial condition, results of operations, cash flows or reporting thereof, and except as otherwise noted above, we do not believe that any of the pronouncements that we have not yet adopted will have a material effect upon our financial condition, results of operations, cash flows or reporting thereof. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 6 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
BUSINESS ACQUISITIONS | NOTE 3. BUSINESS ACQUISITIONS China Branding Group Limited We completed the CBG Acquisition on September 20, 2016. The aggregate consideration of $15.4 million included $7.4 million of cash and the future issuance of seven -year warrants (the “CBG Acquisition Warrants”) to purchase 5,750,000 shares of our common stock at $10.00 per share, subject to certain anti-dilution adjustments. For more information regarding the CBG Acquisition, see Note 3 to the Consolidated Financial Statements in our 2016 Form 10-K. We based our allocation of the purchase consideration we paid to the net tangible and intangible assets we acquired based on their estimated fair values on the closing date of the CBG Acquisition. Such fair values represented our best estimates based on information available to us at the time we calculated the estimates. Final purchase accounting is not yet complete, and additional adjustments are likely during the measurement period. For example, we have identified a tax-related liability that we believe existed prior to the CBG Acquisition, but for which we are still evaluating available information. As a result, we expect to record an adjustment in the third fiscal quarter of 2017, possibly approximating $0.4 million . We did not record any material adjustments to acquisition-date values during the six months ended June 30, 2017 . The following table presents the current status of our preliminary allocation of the purchase consideration we paid to the net tangible and intangible assets we acquired based on their estimated fair values on the closing date of the CBG Acquisition (in thousands): Purchase Price Allocation Cash and cash equivalents $ 60 Accounts receivable 368 Other current assets 17 Total current assets $ 445 Intangibles 9,206 Total identifiable assets acquired $ 9,651 Accounts payable 528 Deferred revenue 145 Other current liabilities 11 Net identifiable assets acquired $ 8,967 Goodwill 6,426 Total purchase consideration $ 15,393 The recorded goodwill primarily results from the synergies we expect to realize from the combination of the entities and the assembled workforce we acquired in connection with the CBG Acquisition. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 4. FAIR VALUE MEASUREMENTS Liabilities Related to Warrants to Purchase Common Stock At the end of each reporting period, we use the Monte Carlo Simulation model to estimate and report the fair value of liabilities related to certain outstanding warrants to purchase our common stock that are subject to potential anti-dilution adjustments or that contain put options or call options. Our outstanding warrants include warrants we issued in connection with our acquisition of all of the outstanding equity interests in Vegas.com, LLC (“Vegas.com”) in September 2015 (the “VDC Acquisition”) and the financing related thereto (referred to herein as the VDC Acquisition Warrants and the VDC Financing Warrants, respectively), the CBG Acquisition Warrants and warrants we issued in connection with the Financing Amendment (the “CBG Financing Warrants”). The following table presents the quantitative inputs, which we classify in Level 3 of the fair value hierarchy, used in estimating the fair value of the warrants: June 30, 2017 December 31, 2016 Warrants issued in February 2012 Expected volatility 45.00 % 45.00 % Risk-free interest rate 0.93 % 0.69 % Expected remaining term (years) 0.16 0.66 June 30, 2017 December 31, 2016 VDC CBG VDC CBG Financing Warrants Expected volatility 50.00 % 50.00 % 50.00 % 50.00 % Risk-free interest rate 1.59 % 1.59 % 1.64 % 1.64 % Expected remaining term (years) 3.23 3.23 3.73 3.73 Acquisition Warrants Expected volatility 50.00 % 50.00 % 50.00 % 50.00 % Risk-free interest rate 1.59 % 2.04 % 1.64 % 2.21 % Expected remaining term (years) 3.23 6.22 3.73 6.72 In addition to the quantitative assumptions above, we also consider whether we would issue additional equity and, if so, the price per share of such equity. At June 30, 2017 , we estimated that three future equity financing events would potentially occur within the subsequent twelve months. Our estimate of expected volatility and our stock price tend to have the most significant impact on the estimated fair value of the VDC and CBG Financing Warrants and the VDC and CBG Acquisition Warrants. If we added or subtracted five percentage points with regard to our estimate of expected volatility, or if our stock price increased or decreased by five percent, our estimates of fair value would change approximately as follows (in thousands): Change in volatility Increase Decrease CBG Financing Warrants $ 245 $ 245 VDC Financing Warrants 225 195 CBG Acquisition Warrants 575 630 VDC Acquisition Warrants 430 345 Change in stock price CBG Financing Warrants $ 135 $ 165 VDC Financing Warrants 85 85 CBG Acquisition Warrants 345 170 VDC Acquisition Warrants 170 85 The following table presents the reconciliation of the beginning and ending balances of the liabilities associated with the VDC and CBG Acquisition Warrants, the VDC and CBG Financing Warrants and the warrants issued in February 2012 that remain outstanding (in thousands): Six Months Ended June 30, Year Ended December 31, 2017 2016 Balance at beginning of period $ 25,030 $ 19,195 New warrant issuances — 11,625 Increase (decrease) in fair value (8,329 ) (5,790 ) Balance at end of period $ 16,701 $ 25,030 At June 30, 2017 , the price of our common stock was less than the exercise price of the VDC Acquisition Warrants, effectively precluding exercise of the warrants. However, each holder has the right to sell its VDC Acquisition Warrant back to us on its expiration date in exchange for shares of our common stock having a value equivalent to the value of the VDC Acquisition Warrant at closing of the VDC Acquisition (reduced pro rata based on the percentage of the VDC Acquisition Warrant exercised), provided that this put option terminates if the closing price of our common stock equals or exceeds $10.16 for any 20 trading days during a period of 30 consecutive trading days at any time on or prior to the expiration date. If the holders had exercised the put option as if June 30, 2017 was the expiration date of the VDC Acquisition Warrants, we would have issued to the holders 3,891,051 shares with a fair value of $2.77 per share. The number of shares issuable upon exercise of the put option is calculated based on the volume weighted average price of our common stock during the 30 trading days ending on the warrants’ expiration date (“30-day VWAP”); the more that the 30-day VWAP decreases, the number of shares we would issue to the holders increases significantly. Contingent Consideration Issued in Business Acquisition We used the discounted cash flow valuation technique to estimate the fair value of the liability related to certain cash payments stipulated in the VDC Acquisition that are contingent upon the performance of Vegas.com in the year ended December 31, 2016, and in the years ending December 31, 2017 and 2018 (the “Earnout Payments”). The significant unobservable inputs that we used, which we classify in Level 3 of the fair value hierarchy, were projected earnings before interest, taxes, depreciation and amortization (“EBITDA”), the probability of achieving certain amounts of EBITDA, and the rate used to discount the liability. The following table presents the change during the six months ended June 30, 2017 in the balance of the liability associated with the Earnout Payments (in thousands): Balance at beginning of period $ 2,860 Change in fair value of contingent consideration 20 Balance at end of period $ 2,880 On the Condensed Consolidated Balance Sheet, we included the current portion of the liability for contingent consideration as a component of Accrued expense and other liabilities, and the long-term portion as a component of Other liabilities (see Note 12 ). We have not yet paid the portion of the Earnout Payments which was due on April 30, 2017. |
RESTRICTED CASH
RESTRICTED CASH | 6 Months Ended |
Jun. 30, 2017 | |
Cash and Cash Equivalents [Abstract] | |
RESTRICTED CASH | NOTE 5. RESTRICTED CASH Regarding our restricted cash, $2.25 million relates to the Financing Agreement and secures our obligations under that agreement. The restriction on the cash related to the Financing Agreement will not be released until we have repaid all of our obligations under the Financing Agreement, unless we obtain the written authorization of the Lenders. The remaining amount of our restricted cash relates to the Letter of Credit Facility Agreement we have in place to satisfy the requirements of several of the vendors for whom we sell products (hotel rooms, air travel, show tickets, et cetera) through our online outlets. By contract, certain vendors require letters of credit as a means of securing our payment to them of amounts related to the sales we make on their behalf. We renew the letter of credit facility annually, and the restrictions on the cash related to the letters of credit will remain to the extent we continue to enter into contracts requiring the security of letters of credit. The following table provides a reconciliation of the amounts separately reported as Cash and cash equivalents and Restricted cash on our consolidated balance sheets with the single line item reported on our consolidated statements of cash flows as Cash, cash equivalents and restricted cash (in thousands): June 30, December 31, 2016 Cash and cash equivalents $ 7,209 $ 6,893 Restricted cash reported in current assets 9,406 9,405 Restricted cash reported in long-term assets 2,250 2,250 Total cash, cash equivalents and restricted cash $ 18,865 $ 18,548 |
INVESTMENT IN UNCONSOLIDATED AF
INVESTMENT IN UNCONSOLIDATED AFFILIATE | 6 Months Ended |
Jun. 30, 2017 | |
Noncontrolling Interest [Abstract] | |
INVESTMENT IN UNCONSOLIDATED AFFILIATE | NOTE 6. INVESTMENT IN UNCONSOLIDATED AFFILIATE In 2009, we co-founded a U.S.-based venture, Sharecare, to build a web-based platform that simplifies the search for health and wellness information. The other co-founders of Sharecare were Dr. Mehmet Oz, HARPO Productions, Discovery Communications, Jeff Arnold and Sony Pictures Television. As of June 30, 2017 , we owned approximately five percent of Sharecare’s issued stock and maintained representation on its Board of Directors. |
PREPAID EXPENSE AND OTHER CURRE
PREPAID EXPENSE AND OTHER CURRENT ASSETS | 6 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSE AND OTHER CURRENT ASSETS | NOTE 7. PREPAID EXPENSE AND OTHER CURRENT ASSETS The following table presents the components of prepaid expense and other current assets (in thousands): June 30, 2017 December 31, 2016 Prepaid expense $ 2,745 $ 2,160 Deposits 164 137 Inventory, net 351 314 Other current assets 412 712 Total $ 3,672 $ 3,323 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 8. PROPERTY AND EQUIPMENT Property and equipment consist of the following (in thousands, except estimated lives): Estimated Life (Years) June 30, December 31, 2016 Vehicles 2 $ 150 $ 150 Computers and equipment 2 - 12 1,469 1,192 Furniture and fixtures 2 - 9 248 244 Software 3 - 5 19,658 19,538 Software development in progress 2,207 839 Leasehold improvements 1 166 166 Total property, equipment and software $ 23,898 $ 22,129 Less accumulated depreciation (9,252 ) (6,598 ) Total property, equipment and software, net $ 14,646 $ 15,531 For the six months ended June 30, 2017 and 2016 , depreciation (and amortization of software) expense was $2.7 million and $2.3 million , respectively. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 9. GOODWILL AND OTHER INTANGIBLE ASSETS The following table summarizes intangible assets by category (in thousands): June 30, 2017 December 31, 2016 Gross Amount Accumulated Net Amount Gross Amount Accumulated Net Amount Finite-lived intangible assets Domain names $ 3,041 $ (1,684 ) $ 1,357 $ 3,041 $ (1,554 ) $ 1,487 Customer relationships 27,064 (8,914 ) 18,150 27,064 (6,513 ) 20,551 Media content and broadcast rights 3,491 (992 ) 2,499 3,491 (541 ) 2,950 Acquired technology 578 (382 ) 196 578 (268 ) 310 Other intangible assets 68 (68 ) — 68 (61 ) 7 $ 34,242 $ (12,040 ) $ 22,202 $ 34,242 $ (8,937 ) $ 25,305 Indefinite-lived intangible assets Trademarks and trade names $ 12,001 $ 12,001 $ 12,001 $ 12,001 License to operate in China 100 100 100 100 Total intangible assets $ 46,343 $ 34,303 $ 46,343 $ 37,406 Total amortization expense was $3.1 million and $2.6 million for the six months ended June 30, 2017 and 2016 , respectively. The following table summarizes the changes in goodwill during the six months ended June 30, 2017 and the year ended December 31, 2016 (in thousands): Six Months Ended June 30, 2017 Year Ended December 31, 2016 Travel and Entertainment Segment Corporate Entity and Other Business Units Total Travel and Entertainment Segment Corporate Entity and Other Business Units Total Balance at beginning of period $ 18,514 $ 8,249 $ 26,763 $ 18,514 $ 1,823 $ 20,337 Business acquisitions — 7 7 — 6,426 6,426 Other — 5 5 — — — Balance at end of period $ 18,514 $ 8,261 $ 26,775 $ 18,514 $ 8,249 $ 26,763 |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 10. DEBT Note Payable On April 12, 2017, we issued a short-term note payable in the principal amount of $3.0 million to a private lender in exchange for cash in the same amount. The agreement, which does not have a stated interest rate, required us to repay the note plus a fee of $115,000 on the maturity date of June 30, 2017. The note is accruing interest at $500 per day on the unpaid principal until we repay the note in full. Long-Term Debt The following table presents long-term debt as of June 30, 2017 (in thousands): June 30, 2017 December 31, 2016 Loan due September 2018 $ 35,500 35,500 Unamortized debt issuance cost (129 ) (175 ) Carrying value of Loan 35,371 35,325 Exit fee payable in relation to Loan 2,500 2,500 Convertible promissory note payable to an accredited investor — 100 Total long-term debt $ 37,871 $ 37,925 Less: current portion (37,871 ) (100 ) Long-term debt, less current portion and net of debt issuance cost — 37,825 On September 24, 2015, we entered into the Financing Agreement, pursuant to which the Lenders provided us with the $27.5 million Loan. As mentioned in Note 1 , we entered into the Financing Amendment on September 20, 2016 which, among other changes, increased the Loan by $8.0 million to a total aggregate principal amount of $35.5 million . The Loan bears interest at three-month LIBOR (with a floor of 1% ) plus 10% per annum, payable monthly, and has a maturity date of September 24, 2018. As of June 30, 2017 , the applicable interest rate on the Loan was approximately 11% per annum. In connection with the Financing Agreement, we also entered into a security agreement dated as of September 24, 2015 (the “Security Agreement”) with the other Borrowers and the Guarantors for the benefit of MGG, as collateral agent for the Secured Parties referred to therein, to secure the obligations of the Borrowers and the Guarantors under the Financing Agreement. The Security Agreement provides for a first-priority lien on, and security interest in, all assets of Remark and our subsidiaries, subject to certain exceptions. The Financing Agreement and the Security Agreement contain representations, warranties, affirmative and negative covenants (including financial covenants with respect to quarterly EBITDA levels and the value of our assets), events of default, indemnifications and other provisions customary for financings of this type. The occurrence of any event of default under the Financing Agreement may result in the Loan amount outstanding and unpaid interest thereon, becoming immediately due and payable. As of June 30, 2017 , we were not in compliance with the covenant under the Financing Agreement requiring minimum consolidated EBITDA of Remark and its subsidiaries for the trailing twelve-month period ended June 30, 2017 of $(2.7) million , as our actual consolidated EBITDA for such period was $(3.5) million . Also, as of July 13, 2017, we were not in compliance with the covenant under the Financing Agreement requiring a minimum restricted cash balance of $2.25 million , as the actual cash balance was $1.56 million . The foregoing instances of non-compliance constitute events of default under the Financing Agreement for which we have not received a waiver as of the date of this report. As a result, the Lenders may declare our obligations under the Financing Agreement, including all unpaid principal and interest, due and payable immediately and exercise such other rights available to them under the Financing Agreement. We have classified the debt as current in the accompanying balance sheet. |
OTHER LIABILITIES
OTHER LIABILITIES | 6 Months Ended |
Jun. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
OTHER LIABILITIES | NOTE 11. OTHER LIABILITIES The following table presents the components of other liabilities (in thousands): June 30, 2017 December 31, 2016 Contingent consideration liability, net of current portion $ 920 $ 1,840 Deferred rent 1,588 1,002 Deferred tax liability, net 1,123 749 Total $ 3,631 $ 3,591 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 12. COMMITMENTS AND CONTINGENCIES We are neither a defendant in any material pending legal proceeding nor are we aware of any material threatened claims against us; therefore, we have not accrued any contingent liabilities, exclusive of the liability for the Earnout Payments related to the VDC Acquisition. |
STOCKHOLDERS' EQUITY AND NET LO
STOCKHOLDERS' EQUITY AND NET LOSS PER SHARE | 6 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY AND NET LOSS PER SHARE | NOTE 13. STOCKHOLDERS' EQUITY AND NET LOSS PER SHARE Equity Issuances During the six months ended June 30, 2017 , we issued a total of 382,308 shares of our common stock to investors in certain private placements in exchange for approximately $1.3 million in cash. Stock-Based Compensation We are authorized to issue equity-based awards under our 2010 Equity Incentive Plan and our 2014 Incentive Plan, each of which our stockholders have approved. We grant such awards to attract, retain and motivate eligible officers, directors, employees and consultants. Under each of the plans, we have granted shares of restricted stock and options to purchase common stock to our officers and employees with exercise prices equal to or greater than the fair value of the underlying shares on the grant date. Stock options awarded generally expire 10 years from the grant date. All forms of equity awards vest upon the passage of time, the attainment of performance criteria, or both. The following table summarizes the stock option activity under our equity incentive plans as of June 30, 2017 , and changes during the six months then ended: Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Outstanding at January 1, 2017 7,344,140 $ 5.01 Granted 2,904,000 2.06 Forfeited, cancelled or expired (152,101 ) 4.42 Outstanding at June 30, 2017 10,096,039 $ 4.16 8.4 $ 2,149 Options exercisable at June 30, 2017 7,541,780 $ 4.77 8.0 $ 540 We incurred share-based compensation expense of $0.3 million and $1.0 million , respectively, during the three months ended June 30, 2017 and 2016 , and of $0.6 million and $2.4 million , respectively, during the six months ended June 30, 2017 and 2016 . Net Income (Loss) per Share For the three and six months ended June 30, 2017 and 2016 , there were no reconciling items related to either the numerator or denominator of the loss per share calculation. Securities which would have been anti-dilutive to a calculation of diluted earnings per share include: • the outstanding stock options described above; • the outstanding CBG Acquisition Warrant, which may be exercised to purchase 40,000 shares of our common stock at a per-share exercise price of $10.00 (we are also committed to the future issuance of additional CBG Acquisition Warrants at the same per-share exercise price as the CBG Acquisition Warrant that has already been issued), and the outstanding CBG Financing Warrants, which may be exercised to purchase 2,741,229 shares of our common stock at an exercise price of $5.36 per share; • the outstanding VDC Acquisition Warrants, which may be exercised to purchase 8,601,410 shares of our common stock at an exercise price of $9.00 per share, and the outstanding VDC Financing Warrants, which may be exercised to purchase 2,786,535 shares of our common stock at an exercise price of $8.33 per share; • the warrants issued in conjunction with our acquisition of Hotelmobi, Inc., which may be exercised to purchase 1,000,000 shares of our common stock, half at an exercise price of $8.00 per share and half at an exercise price of $12.00 per share; and • the warrants issued in conjunction with a private placement in 2012, which may be exercised to purchase 215,278 shares of our common stock at an exercise price of $4.85 per share. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 14. SEGMENT INFORMATION In the presentation of our segment information, we include Adjusted EBITDA, which is a “non-GAAP financial measure” as defined in Item 10(e) of Regulation S-K promulgated by the Securities and Exchange Commission (“SEC”). We use Adjusted EBITDA as a supplement to operating income (loss), the most comparable GAAP financial measure, to evaluate the operational performance of our reportable segment. Adjusted EBITDA represents operating income (loss) plus depreciation and amortization expense, share-based compensation expense, impairments and net other income, less other loss. You should not consider our presentation of Adjusted EBITDA in isolation, or consider it superior to, or as a substitute for, financial information prepared and presented in accordance with GAAP. You should also note that our calculation of Adjusted EBITDA may be different from the calculation of Adjusted EBITDA or similarly-titled non-GAAP financial measures used by other companies; therefore, our Adjusted EBITDA may not be comparable to such other measures. The following table presents certain financial information regarding our travel and entertainment segment for the three and six months ended June 30, 2017 and 2016 (in thousands): Segment Corporate Entity and Other Consolidated Three Months Ended June 30, 2017 GAAP financial measures: Net revenue $ 15,288 $ 1,968 $ 17,256 Operating loss $ (322 ) $ (4,355 ) $ (4,677 ) Non-GAAP financial measure: Adjusted EBITDA $ 1,763 $ (3,245 ) $ (1,482 ) Six Months Ended June 30, 2017 GAAP financial measures: Net revenue $ 29,481 $ 3,074 $ 32,555 Operating loss $ (1,777 ) $ (8,280 ) $ (10,057 ) Non-GAAP financial measure: Adjusted EBITDA $ 2,367 $ (6,105 ) $ (3,738 ) Three Months Ended June 30, 2016 GAAP financial measures: Net revenue $ 14,234 $ 741 $ 14,975 Operating loss $ 405 $ (3,908 ) $ (3,503 ) Non-GAAP financial measure: Adjusted EBITDA $ 2,418 $ (2,521 ) $ (103 ) Six Months Ended June 30, 2016 GAAP financial measures: Net revenue $ 27,777 $ 1,452 $ 29,229 Operating loss $ (978 ) $ (7,701 ) $ (8,679 ) Non-GAAP financial measure: Adjusted EBITDA $ 3,063 $ (4,509 ) $ (1,446 ) The following table reconciles Adjusted EBITDA for the segment and for the corporate entity and other business units to Operating loss (in thousands): Segment Corporate Entity and Other Consolidated Three Months Ended June 30, 2017 Adjusted EBITDA $ 1,763 $ (3,245 ) (1,482 ) Less: Depreciation, amortization and impairments (2,085 ) (809 ) (2,894 ) Share-based compensation expense — (321 ) (321 ) Other income, net — (1 ) (1 ) Plus: Other loss — 21 21 Operating loss $ (322 ) $ (4,355 ) $ (4,677 ) Six Months Ended June 30, 2017 Adjusted EBITDA $ 2,367 $ (6,105 ) (3,738 ) Less: Depreciation, amortization and impairments (4,125 ) (1,630 ) (5,755 ) Share-based compensation expense — (596 ) (596 ) Other income, net (19 ) (1 ) (20 ) Plus: Other loss — 52 52 Operating loss $ (1,777 ) $ (8,280 ) $ (10,057 ) Three Months Ended June 30, 2016 Adjusted EBITDA $ 2,418 $ (2,521 ) (103 ) Less: Depreciation, amortization and impairments (2,013 ) (466 ) (2,479 ) Share-based compensation expense — (988 ) (988 ) Other income, net — (1 ) (1 ) Plus: Other loss — 68 68 Operating loss $ 405 $ (3,908 ) $ (3,503 ) Six Months Ended June 30, 2016 Adjusted EBITDA $ 3,063 $ (4,509 ) (1,446 ) Less: Depreciation, amortization and impairments (4,012 ) (864 ) (4,876 ) Share-based compensation expense — (2,398 ) (2,398 ) Other income, net (29 ) (1 ) (30 ) Plus: Other loss — 71 71 Operating loss $ (978 ) $ (7,701 ) $ (8,679 ) The following table presents total assets for our travel and entertainment segment (in thousands): June 30, December 31, 2016 Travel and entertainment segment $ 73,214 $ 76,074 Corporate entity and other business units 28,107 29,625 Consolidated $ 101,321 $ 105,699 Capital expenditures for the travel and entertainment segment totaled $0.5 million and $0.4 million during the three months ended June 30, 2017 and 2016 , respectively, and $0.9 million and $0.7 million during the six months ended June 30, 2017 and 2016 , respectively. |
SUMMARY OF SIGNIFICANT ACCOUN20
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Accounting | We prepared the accompanying unaudited Condensed Consolidated Balance Sheet as of June 30, 2017 , with the audited Consolidated Balance Sheet amounts as of December 31, 2016 presented for comparative purposes, and the related unaudited Condensed Consolidated Statements of Operations and Statements of Cash Flows in accordance with the instructions for Form 10-Q. In compliance with those instructions, we have omitted certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), though management believes the disclosures made herein are sufficient to ensure that the information presented is not misleading. Our results of operations and our cash flows as of the end of the interim periods reported herein do not necessarily indicate the results we may experience for the remainder of the year or for any other future period. Management believes that we have included all adjustments (including those of a normal, recurring nature) considered necessary to fairly present our unaudited Condensed Consolidated Balance Sheet as of June 30, 2017 , our unaudited Condensed Consolidated Statements of Operations and our unaudited Condensed Consolidated Statements of Cash Flows for all periods presented. You should read our unaudited condensed consolidated interim financial statements and footnotes in conjunction with our consolidated financial statements and footnotes included within our Annual Report on Form 10-K for the year ended December 31, 2016 (the “ 2016 Form 10-K”). |
Consolidation | Consolidation We include all of our subsidiaries in our consolidated financial statements, eliminating all significant intercompany balances and transactions during consolidation. The equity of certain of our subsidiaries is either partially or fully held by citizens of the country of incorporation to comply with local laws and regulations. |
Use of Estimates | Use of Estimates We prepare our consolidated financial statements in conformity with GAAP. While preparing our financial statements, we make estimates and assumptions that affect amounts reported and disclosed in the consolidated financial statements and accompanying notes. Accordingly, actual results could differ from those estimates. On an ongoing basis, we evaluate our estimates, including those related to accounts receivable, intangible assets, the useful lives of property and equipment, stock-based compensation, the fair value of the warrant liability, income taxes, inventory reserve and purchase price allocation, among other items. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In July 2017, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2017-11, Accounting for Certain Financial Instruments with Down Round Features , which changes how an entity determines whether certain financial instruments should be classified as liabilities or equity instruments. Under ASU 2017-11, a down round feature no longer precludes equity classification when an entity assesses whether the instrument is indexed to the entity's own stock. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. The amendments also require entities to recognize the effect of the down round feature as a dividend when the feature is triggered (which would affect the presentation of earnings per share) and they clarify existing disclosure requirements for equity-classified instruments. We are currently evaluating the impact that application of ASU 2017-11 will have on our consolidated financial statements, results of operations and cash flows. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , which changes GAAP primarily by requiring lessees to recognize, at lease commencement, a lease liability representing the present value of the lessee’s obligation to make lease payments, and a right-of-use asset representing the lessee’s right to use (or control the use of) a specified asset during the lease term, for leases classified as operating leases. For us the amendments in ASU 2016-02 will become effective on January 1, 2019, and early adoption is permitted. We are currently evaluating the impact that application of ASU 2016-02 will have on our consolidated financial statements, results of operations and cash flows. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which outlines a single, comprehensive model for an entity to use to ensure that it recognizes revenue in a manner that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. For us, the amendments in ASU 2014-09 are effective for fiscal years beginning after December 15, 2017, including interim periods therein. Though we do not believe that this guidance will have a material effect upon the financial condition, results of operations, cash flows or reporting thereof for most of our existing subsidiaries, we are evaluating the impact the guidance will have on the business we acquired when we, together with our wholly-owned subsidiary KanKan Limited, completed the acquisition (the “CBG Acquisition”) of assets of China Branding Group Limited (“CBG”) on September 20, 2016, pursuant to the terms of the Second Amended and Restated Asset and Securities Purchase Agreement, dated as of the same date. We have reviewed all recently issued accounting pronouncements. The pronouncements that we have already adopted did not have a material effect on our financial condition, results of operations, cash flows or reporting thereof, and except as otherwise noted above, we do not believe that any of the pronouncements that we have not yet adopted will have a material effect upon our financial condition, results of operations, cash flows or reporting thereof. |
BUSINESS ACQUISITIONS (Tables)
BUSINESS ACQUISITIONS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
Schedule of recognized identified assets acquired and liabilities assumed | The following table presents the current status of our preliminary allocation of the purchase consideration we paid to the net tangible and intangible assets we acquired based on their estimated fair values on the closing date of the CBG Acquisition (in thousands): Purchase Price Allocation Cash and cash equivalents $ 60 Accounts receivable 368 Other current assets 17 Total current assets $ 445 Intangibles 9,206 Total identifiable assets acquired $ 9,651 Accounts payable 528 Deferred revenue 145 Other current liabilities 11 Net identifiable assets acquired $ 8,967 Goodwill 6,426 Total purchase consideration $ 15,393 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Quantitative inputs | If we added or subtracted five percentage points with regard to our estimate of expected volatility, or if our stock price increased or decreased by five percent, our estimates of fair value would change approximately as follows (in thousands): Change in volatility Increase Decrease CBG Financing Warrants $ 245 $ 245 VDC Financing Warrants 225 195 CBG Acquisition Warrants 575 630 VDC Acquisition Warrants 430 345 Change in stock price CBG Financing Warrants $ 135 $ 165 VDC Financing Warrants 85 85 CBG Acquisition Warrants 345 170 VDC Acquisition Warrants 170 85 The following table presents the quantitative inputs, which we classify in Level 3 of the fair value hierarchy, used in estimating the fair value of the warrants: June 30, 2017 December 31, 2016 Warrants issued in February 2012 Expected volatility 45.00 % 45.00 % Risk-free interest rate 0.93 % 0.69 % Expected remaining term (years) 0.16 0.66 June 30, 2017 December 31, 2016 VDC CBG VDC CBG Financing Warrants Expected volatility 50.00 % 50.00 % 50.00 % 50.00 % Risk-free interest rate 1.59 % 1.59 % 1.64 % 1.64 % Expected remaining term (years) 3.23 3.23 3.73 3.73 Acquisition Warrants Expected volatility 50.00 % 50.00 % 50.00 % 50.00 % Risk-free interest rate 1.59 % 2.04 % 1.64 % 2.21 % Expected remaining term (years) 3.23 6.22 3.73 6.72 |
Reconciliation of liabilities of warrants | The following table presents the reconciliation of the beginning and ending balances of the liabilities associated with the VDC and CBG Acquisition Warrants, the VDC and CBG Financing Warrants and the warrants issued in February 2012 that remain outstanding (in thousands): Six Months Ended June 30, Year Ended December 31, 2017 2016 Balance at beginning of period $ 25,030 $ 19,195 New warrant issuances — 11,625 Increase (decrease) in fair value (8,329 ) (5,790 ) Balance at end of period $ 16,701 $ 25,030 |
Reconciliation of earnout payments | The following table presents the change during the six months ended June 30, 2017 in the balance of the liability associated with the Earnout Payments (in thousands): Balance at beginning of period $ 2,860 Change in fair value of contingent consideration 20 Balance at end of period $ 2,880 |
RESTRICTED CASH (Tables)
RESTRICTED CASH (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of cash, cash equivalents and restricted cash | The following table provides a reconciliation of the amounts separately reported as Cash and cash equivalents and Restricted cash on our consolidated balance sheets with the single line item reported on our consolidated statements of cash flows as Cash, cash equivalents and restricted cash (in thousands): June 30, December 31, 2016 Cash and cash equivalents $ 7,209 $ 6,893 Restricted cash reported in current assets 9,406 9,405 Restricted cash reported in long-term assets 2,250 2,250 Total cash, cash equivalents and restricted cash $ 18,865 $ 18,548 |
PREPAID EXPENSE AND OTHER CUR24
PREPAID EXPENSE AND OTHER CURRENT ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid expense and other current assets | The following table presents the components of prepaid expense and other current assets (in thousands): June 30, 2017 December 31, 2016 Prepaid expense $ 2,745 $ 2,160 Deposits 164 137 Inventory, net 351 314 Other current assets 412 712 Total $ 3,672 $ 3,323 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment | Property and equipment consist of the following (in thousands, except estimated lives): Estimated Life (Years) June 30, December 31, 2016 Vehicles 2 $ 150 $ 150 Computers and equipment 2 - 12 1,469 1,192 Furniture and fixtures 2 - 9 248 244 Software 3 - 5 19,658 19,538 Software development in progress 2,207 839 Leasehold improvements 1 166 166 Total property, equipment and software $ 23,898 $ 22,129 Less accumulated depreciation (9,252 ) (6,598 ) Total property, equipment and software, net $ 14,646 $ 15,531 |
GOODWILL AND OTHER INTANGIBLE26
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Finite-lived intangible assets | The following table summarizes intangible assets by category (in thousands): June 30, 2017 December 31, 2016 Gross Amount Accumulated Net Amount Gross Amount Accumulated Net Amount Finite-lived intangible assets Domain names $ 3,041 $ (1,684 ) $ 1,357 $ 3,041 $ (1,554 ) $ 1,487 Customer relationships 27,064 (8,914 ) 18,150 27,064 (6,513 ) 20,551 Media content and broadcast rights 3,491 (992 ) 2,499 3,491 (541 ) 2,950 Acquired technology 578 (382 ) 196 578 (268 ) 310 Other intangible assets 68 (68 ) — 68 (61 ) 7 $ 34,242 $ (12,040 ) $ 22,202 $ 34,242 $ (8,937 ) $ 25,305 Indefinite-lived intangible assets Trademarks and trade names $ 12,001 $ 12,001 $ 12,001 $ 12,001 License to operate in China 100 100 100 100 Total intangible assets $ 46,343 $ 34,303 $ 46,343 $ 37,406 |
Indefinite-lived intangible assets | The following table summarizes intangible assets by category (in thousands): June 30, 2017 December 31, 2016 Gross Amount Accumulated Net Amount Gross Amount Accumulated Net Amount Finite-lived intangible assets Domain names $ 3,041 $ (1,684 ) $ 1,357 $ 3,041 $ (1,554 ) $ 1,487 Customer relationships 27,064 (8,914 ) 18,150 27,064 (6,513 ) 20,551 Media content and broadcast rights 3,491 (992 ) 2,499 3,491 (541 ) 2,950 Acquired technology 578 (382 ) 196 578 (268 ) 310 Other intangible assets 68 (68 ) — 68 (61 ) 7 $ 34,242 $ (12,040 ) $ 22,202 $ 34,242 $ (8,937 ) $ 25,305 Indefinite-lived intangible assets Trademarks and trade names $ 12,001 $ 12,001 $ 12,001 $ 12,001 License to operate in China 100 100 100 100 Total intangible assets $ 46,343 $ 34,303 $ 46,343 $ 37,406 |
Goodwill | The following table summarizes the changes in goodwill during the six months ended June 30, 2017 and the year ended December 31, 2016 (in thousands): Six Months Ended June 30, 2017 Year Ended December 31, 2016 Travel and Entertainment Segment Corporate Entity and Other Business Units Total Travel and Entertainment Segment Corporate Entity and Other Business Units Total Balance at beginning of period $ 18,514 $ 8,249 $ 26,763 $ 18,514 $ 1,823 $ 20,337 Business acquisitions — 7 7 — 6,426 6,426 Other — 5 5 — — — Balance at end of period $ 18,514 $ 8,261 $ 26,775 $ 18,514 $ 8,249 $ 26,763 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt instruments | The following table presents long-term debt as of June 30, 2017 (in thousands): June 30, 2017 December 31, 2016 Loan due September 2018 $ 35,500 35,500 Unamortized debt issuance cost (129 ) (175 ) Carrying value of Loan 35,371 35,325 Exit fee payable in relation to Loan 2,500 2,500 Convertible promissory note payable to an accredited investor — 100 Total long-term debt $ 37,871 $ 37,925 Less: current portion (37,871 ) (100 ) Long-term debt, less current portion and net of debt issuance cost — 37,825 |
OTHER LIABILITIES (Tables)
OTHER LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities | The following table presents the components of other liabilities (in thousands): June 30, 2017 December 31, 2016 Contingent consideration liability, net of current portion $ 920 $ 1,840 Deferred rent 1,588 1,002 Deferred tax liability, net 1,123 749 Total $ 3,631 $ 3,591 |
STOCKHOLDERS' EQUITY AND NET 29
STOCKHOLDERS' EQUITY AND NET LOSS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
Stock option activity under equity incentive plans | The following table summarizes the stock option activity under our equity incentive plans as of June 30, 2017 , and changes during the six months then ended: Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) Outstanding at January 1, 2017 7,344,140 $ 5.01 Granted 2,904,000 2.06 Forfeited, cancelled or expired (152,101 ) 4.42 Outstanding at June 30, 2017 10,096,039 $ 4.16 8.4 $ 2,149 Options exercisable at June 30, 2017 7,541,780 $ 4.77 8.0 $ 540 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following table presents certain financial information regarding our travel and entertainment segment for the three and six months ended June 30, 2017 and 2016 (in thousands): Segment Corporate Entity and Other Consolidated Three Months Ended June 30, 2017 GAAP financial measures: Net revenue $ 15,288 $ 1,968 $ 17,256 Operating loss $ (322 ) $ (4,355 ) $ (4,677 ) Non-GAAP financial measure: Adjusted EBITDA $ 1,763 $ (3,245 ) $ (1,482 ) Six Months Ended June 30, 2017 GAAP financial measures: Net revenue $ 29,481 $ 3,074 $ 32,555 Operating loss $ (1,777 ) $ (8,280 ) $ (10,057 ) Non-GAAP financial measure: Adjusted EBITDA $ 2,367 $ (6,105 ) $ (3,738 ) Three Months Ended June 30, 2016 GAAP financial measures: Net revenue $ 14,234 $ 741 $ 14,975 Operating loss $ 405 $ (3,908 ) $ (3,503 ) Non-GAAP financial measure: Adjusted EBITDA $ 2,418 $ (2,521 ) $ (103 ) Six Months Ended June 30, 2016 GAAP financial measures: Net revenue $ 27,777 $ 1,452 $ 29,229 Operating loss $ (978 ) $ (7,701 ) $ (8,679 ) Non-GAAP financial measure: Adjusted EBITDA $ 3,063 $ (4,509 ) $ (1,446 ) The following table reconciles Adjusted EBITDA for the segment and for the corporate entity and other business units to Operating loss (in thousands): Segment Corporate Entity and Other Consolidated Three Months Ended June 30, 2017 Adjusted EBITDA $ 1,763 $ (3,245 ) (1,482 ) Less: Depreciation, amortization and impairments (2,085 ) (809 ) (2,894 ) Share-based compensation expense — (321 ) (321 ) Other income, net — (1 ) (1 ) Plus: Other loss — 21 21 Operating loss $ (322 ) $ (4,355 ) $ (4,677 ) Six Months Ended June 30, 2017 Adjusted EBITDA $ 2,367 $ (6,105 ) (3,738 ) Less: Depreciation, amortization and impairments (4,125 ) (1,630 ) (5,755 ) Share-based compensation expense — (596 ) (596 ) Other income, net (19 ) (1 ) (20 ) Plus: Other loss — 52 52 Operating loss $ (1,777 ) $ (8,280 ) $ (10,057 ) Three Months Ended June 30, 2016 Adjusted EBITDA $ 2,418 $ (2,521 ) (103 ) Less: Depreciation, amortization and impairments (2,013 ) (466 ) (2,479 ) Share-based compensation expense — (988 ) (988 ) Other income, net — (1 ) (1 ) Plus: Other loss — 68 68 Operating loss $ 405 $ (3,908 ) $ (3,503 ) Six Months Ended June 30, 2016 Adjusted EBITDA $ 3,063 $ (4,509 ) (1,446 ) Less: Depreciation, amortization and impairments (4,012 ) (864 ) (4,876 ) Share-based compensation expense — (2,398 ) (2,398 ) Other income, net (29 ) (1 ) (30 ) Plus: Other loss — 71 71 Operating loss $ (978 ) $ (7,701 ) $ (8,679 ) The following table presents total assets for our travel and entertainment segment (in thousands): June 30, December 31, 2016 Travel and entertainment segment $ 73,214 $ 76,074 Corporate entity and other business units 28,107 29,625 Consolidated $ 101,321 $ 105,699 |
ORGANIZATION AND BUSINESS (Det
ORGANIZATION AND BUSINESS (Details) - USD ($) | Sep. 20, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Dec. 31, 2016 | Sep. 24, 2015 |
Description of Business [Line Items] | ||||||||
Accumulated deficit | $ 197,446,000 | $ 197,446,000 | $ 197,446,000 | $ 193,113,000 | ||||
Cash and cash equivalents | 7,209,000 | 7,209,000 | 7,209,000 | 6,893,000 | ||||
Working capital | (64,700,000) | (64,700,000) | (64,700,000) | |||||
Revenue, net | 17,256,000 | $ 14,975,000 | 32,555,000 | $ 29,229,000 | ||||
Property and equipment, net | 14,646,000 | $ 14,646,000 | 14,646,000 | 15,531,000 | ||||
Common Stock | ||||||||
Description of Business [Line Items] | ||||||||
Common stock issuances (in shares) | 382,308 | |||||||
Common stock issuances | $ 1,300,000 | |||||||
Loans Payable | ||||||||
Description of Business [Line Items] | ||||||||
Original principal amount | $ 35,500,000 | 35,500,000 | 35,500,000 | 35,500,000 | $ 35,500,000 | $ 27,500,000 | ||
Additional principal amount | $ 8,000,000 | |||||||
Financing And Security Agreements | ||||||||
Description of Business [Line Items] | ||||||||
EBITDA minimum requirement | (2,700,000) | |||||||
Actual EBITDA | (3,500,000) | |||||||
Minimum restricted cash balance requirement | 2,250,000 | 2,250,000 | 2,250,000 | |||||
Restricted cash | $ 1,560,000 | $ 1,560,000 | $ 1,560,000 |
BUSINESS ACQUISITIONS - Schedu
BUSINESS ACQUISITIONS - Schedule of Assets and Liabilities (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 20, 2016 | Jun. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Liabilities [Abstract] | ||||
Goodwill | $ 26,775 | $ 26,763 | $ 20,337 | |
China Branding Group Limited | ||||
Business Acquisition [Line Items] | ||||
Total purchase consideration | $ 15,400 | |||
Cash paid to acquire business | $ 7,400 | |||
Warrants that would have been issued to holders on as-exercised basis (shares) | 5,750,000 | |||
Exercise price (usd per share) | $ 10 | |||
Adjustments expected | $ 400 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets [Abstract] | ||||
Cash and cash equivalents | $ 60 | |||
Accounts receivable | 368 | |||
Other current assets | 17 | |||
Total current assets | 445 | |||
Intangibles | 9,206 | |||
Total identifiable assets acquired | 9,651 | |||
Liabilities [Abstract] | ||||
Accounts payable | 528 | |||
Deferred revenue | 145 | |||
Other current liabilities | 11 | |||
Net identifiable assets acquired | 8,967 | |||
Goodwill | 6,426 | |||
Total purchase consideration | $ 15,393 | |||
Financing Warrants | China Branding Group Limited | ||||
Business Acquisition [Line Items] | ||||
Term of warrants | 7 years | |||
Exercise price (usd per share) | $ 5.36 |
FAIR VALUE MEASUREMENTS - Sche
FAIR VALUE MEASUREMENTS - Schedule of Assumptions Used in Calculating the Fair Value of Warrants (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Expected volatility | 45.00% | 45.00% |
Risk-free interest rate | 0.93% | 0.69% |
Expected remaining term (years) | 1 month 27 days | 7 months 28 days |
Financing Warrants | Vegas.com LLC | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Expected volatility | 50.00% | 50.00% |
Risk-free interest rate | 1.59% | 1.64% |
Expected remaining term (years) | 3 years 2 months 22 days | 3 years 8 months 22 days |
Financing Warrants | China Branding Group Limited | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Expected volatility | 50.00% | 50.00% |
Risk-free interest rate | 1.59% | 1.64% |
Expected remaining term (years) | 3 years 2 months 22 days | 3 years 8 months 22 days |
Acquisition Warrants | Warrant | Vegas.com LLC | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Expected volatility | 50.00% | 50.00% |
Risk-free interest rate | 1.59% | 1.64% |
Expected remaining term (years) | 3 years 2 months 22 days | 3 years 8 months 22 days |
Acquisition Warrants | Warrant | China Branding Group Limited | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Expected volatility | 50.00% | 50.00% |
Risk-free interest rate | 2.04% | 2.21% |
Expected remaining term (years) | 6 years 2 months 20 days | 6 years 8 months 20 days |
FAIR VALUE MEASUREMENTS - Esti
FAIR VALUE MEASUREMENTS - Estimate of Expected Volatility and Stock Price (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2017USD ($) | |
Financing Warrants | China Branding Group Limited | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Changes in fair value resulting from 5% increase in expected volatility | $ 245 |
Changes in fair value resulting from 5% decrease in expected volatility | 245 |
Changes in fair value resulting from 5% increase of stock price | 135 |
Changes in fair value resulting from 5% decrease of stock price | 165 |
Financing Warrants | Vegas.com LLC | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Changes in fair value resulting from 5% increase in expected volatility | 225 |
Changes in fair value resulting from 5% decrease in expected volatility | 195 |
Changes in fair value resulting from 5% increase of stock price | 85 |
Changes in fair value resulting from 5% decrease of stock price | 85 |
Acquisition Warrants | China Branding Group Limited | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Changes in fair value resulting from 5% increase in expected volatility | 575 |
Changes in fair value resulting from 5% decrease in expected volatility | 630 |
Changes in fair value resulting from 5% increase of stock price | 345 |
Changes in fair value resulting from 5% decrease of stock price | 170 |
Acquisition Warrants | Vegas.com LLC | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Changes in fair value resulting from 5% increase in expected volatility | 430 |
Changes in fair value resulting from 5% decrease in expected volatility | 345 |
Changes in fair value resulting from 5% increase of stock price | 170 |
Changes in fair value resulting from 5% decrease of stock price | $ 85 |
FAIR VALUE MEASUREMENTS - Narr
FAIR VALUE MEASUREMENTS - Narrative (Details) | 6 Months Ended |
Jun. 30, 2017dayfuture_event$ / sharesshares | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated future equity financing events | future_event | 3 |
Warrant | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Stock price trigger (usd per share) | $ / shares | $ 10.16 |
Threshold trading days | day | 20 |
Threshold consecutive trading days | day | 30 |
Exercise price (usd per share) | $ / shares | $ 2.77 |
Common Stock | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Warrants that would have been issued to holders on as-exercised basis (shares) | shares | 3,891,051 |
FAIR VALUE MEASUREMENTS - Chan
FAIR VALUE MEASUREMENTS - Change in Fair Value of Warrants Accounted for as Derivative Liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Change in the Fair Value of Warrants | ||
Balance at beginning of period | $ 25,030 | $ 19,195 |
New warrant issuances | 0 | 11,625 |
Increase (decrease) in fair value | (8,329) | (5,790) |
Balance at end of period | 16,701 | 25,030 |
Vegas.com LLC | ||
Contingent Consideration | ||
Balance at beginning of period | 2,860 | |
Change in fair value of contingent consideration | 20 | |
Balance at end of period | $ 2,880 | $ 2,860 |
RESTRICTED CASH (Details)
RESTRICTED CASH (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 7,209 | $ 6,893 | ||
Restricted cash reported in current assets | 9,406 | 9,405 | ||
Restricted cash reported in long-term assets | 2,250 | 2,250 | ||
Total cash, cash equivalents and restricted cash | $ 18,865 | $ 18,548 | $ 19,694 | $ 17,088 |
INVESTMENT IN UNCONSOLIDATED 38
INVESTMENT IN UNCONSOLIDATED AFFILIATE (Details) | Jun. 30, 2017 |
Sharecare | |
Noncontrolling Interest [Line Items] | |
Ownership percentage in unconsolidated affiliate | 5.00% |
PREPAID EXPENSE AND OTHER CUR39
PREPAID EXPENSE AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Prepaid Expense and Other Current Assets | ||
Prepaid expense | $ 2,745 | $ 2,160 |
Deposits | 164 | 137 |
Inventory, net | 351 | 314 |
Other current assets | 412 | 712 |
Total | $ 3,672 | $ 3,323 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | |||
Total property, equipment and software | $ 23,898 | $ 22,129 | |
Less accumulated depreciation | (9,252) | (6,598) | |
Total property, equipment and software, net | 14,646 | 15,531 | |
Depreciation and amortization | $ 2,700 | $ 2,300 | |
Vehicles | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life (Years) | 2 years | ||
Total property, equipment and software | $ 150 | 150 | |
Computers and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property, equipment and software | 1,469 | 1,192 | |
Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Total property, equipment and software | 248 | 244 | |
Software | |||
Property, Plant and Equipment [Line Items] | |||
Total property, equipment and software | 19,658 | 19,538 | |
Software development in progress | |||
Property, Plant and Equipment [Line Items] | |||
Total property, equipment and software | $ 2,207 | 839 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life (Years) | 1 year | ||
Total property, equipment and software | $ 166 | $ 166 | |
Minimum | Computers and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life (Years) | 2 years | ||
Minimum | Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life (Years) | 2 years | ||
Minimum | Software | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life (Years) | 3 years | ||
Maximum | Computers and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life (Years) | 12 years | ||
Maximum | Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life (Years) | 9 years | ||
Maximum | Software | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life (Years) | 5 years |
GOODWILL AND OTHER INTANGIBLE41
GOODWILL AND OTHER INTANGIBLE ASSETS - Intangible Assets Rollforward (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Finite-lived intangible assets | |||
Gross Amount | $ 34,242 | $ 34,242 | |
Accumulated Amortization | (12,040) | (8,937) | |
Net Amount | 22,202 | 25,305 | |
Indefinite-lived intangible assets | |||
Total intangible assets, Gross Amount | 46,343 | 46,343 | |
Total intangible assets, Net Amount | 34,303 | 37,406 | |
Amortization expense | 3,100 | $ 2,600 | |
Trademarks and trade names | |||
Indefinite-lived intangible assets | |||
Indefinite lived intangible assets | 12,001 | 12,001 | |
License to operate in China | |||
Indefinite-lived intangible assets | |||
Indefinite lived intangible assets | 100 | 100 | |
Domain names | |||
Finite-lived intangible assets | |||
Gross Amount | 3,041 | 3,041 | |
Accumulated Amortization | (1,684) | (1,554) | |
Net Amount | 1,357 | 1,487 | |
Customer relationships | |||
Finite-lived intangible assets | |||
Gross Amount | 27,064 | 27,064 | |
Accumulated Amortization | (8,914) | (6,513) | |
Net Amount | 18,150 | 20,551 | |
Media content and broadcast rights | |||
Finite-lived intangible assets | |||
Gross Amount | 3,491 | 3,491 | |
Accumulated Amortization | (992) | (541) | |
Net Amount | 2,499 | 2,950 | |
Acquired technology | |||
Finite-lived intangible assets | |||
Gross Amount | 578 | 578 | |
Accumulated Amortization | (382) | (268) | |
Net Amount | 196 | 310 | |
Other intangible assets | |||
Finite-lived intangible assets | |||
Gross Amount | 68 | 68 | |
Accumulated Amortization | (68) | (61) | |
Net Amount | $ 0 | $ 7 |
GOODWILL AND OTHER INTANGIBLE42
GOODWILL AND OTHER INTANGIBLE ASSETS - Goodwill Rollforward (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Goodwill [Roll Forward] | ||
Balance at beginning of period | $ 26,763 | $ 20,337 |
Business acquisitions | 7 | 6,426 |
Other | 5 | 0 |
Balance at end of period | 26,775 | 26,763 |
Operating Segments | Travel and entertainment segment | ||
Goodwill [Roll Forward] | ||
Balance at beginning of period | 18,514 | 18,514 |
Business acquisitions | 0 | 0 |
Other | 0 | 0 |
Balance at end of period | 18,514 | 18,514 |
Operating Segments | Corporate entity and other business units | ||
Goodwill [Roll Forward] | ||
Balance at beginning of period | 8,249 | 1,823 |
Business acquisitions | 7 | 6,426 |
Other | 5 | 0 |
Balance at end of period | $ 8,261 | $ 8,249 |
DEBT - Note Payable (Details)
DEBT - Note Payable (Details) - Short-term note payable to private lender | Apr. 12, 2017USD ($) |
Short-term Debt [Line Items] | |
Short-term note payable | $ 3,000,000 |
Fee payable in relation to short-term note payable | 115,000 |
Daily interest accrued on unpaid balance after maturity | $ 500 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) - USD ($) | Sep. 20, 2016 | Jun. 30, 2017 | Dec. 31, 2016 | Sep. 24, 2015 |
Loans Payable | ||||
Debt Instrument [Line Items] | ||||
Original principal amount | $ 35,500,000 | $ 35,500,000 | $ 35,500,000 | $ 27,500,000 |
Additional principal amount | $ 8,000,000 | |||
Interest rate floor of variable rate | 1.00% | |||
Effective interest rate | 11.00% | |||
Financing And Security Agreements | ||||
Debt Instrument [Line Items] | ||||
EBITDA minimum requirement | $ (2,700,000) | |||
Actual EBITDA | (3,500,000) | |||
Minimum restricted cash balance requirement | 2,250,000 | |||
Restricted cash | $ 1,560,000 | |||
LIBOR | Loans Payable | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 10.00% |
DEBT - Schedule of Debt Instru
DEBT - Schedule of Debt Instruments (Details) - USD ($) | Jun. 30, 2017 | Dec. 31, 2016 | Sep. 20, 2016 | Sep. 24, 2015 |
Debt Instrument [Line Items] | ||||
Total long-term debt | $ 37,871,000 | $ 37,925,000 | ||
Less: current portion | (37,871,000) | (100,000) | ||
Long-term debt, less current portion and net of debt issuance cost | 0 | 37,825,000 | ||
Loans Payable | ||||
Debt Instrument [Line Items] | ||||
Original principal amount | 35,500,000 | 35,500,000 | $ 35,500,000 | $ 27,500,000 |
Unamortized debt issuance cost | (129,000) | (175,000) | ||
Exit fee payable in relation to Loan | 2,500,000 | 2,500,000 | ||
Total long-term debt | 35,371,000 | 35,325,000 | ||
Accredited Investor | Convertible Promissory Notes | ||||
Debt Instrument [Line Items] | ||||
Convertible promissory note payable to an accredited investor | $ 0 | $ 100,000 |
OTHER LIABILITIES (Details)
OTHER LIABILITIES (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Other Liabilities Disclosure [Abstract] | ||
Contingent consideration liability, net of current portion | $ 920 | $ 1,840 |
Deferred rent | 1,588 | 1,002 |
Deferred tax liability, net | 1,123 | 749 |
Total | $ 3,631 | $ 3,591 |
STOCKHOLDERS' EQUITY AND NET 47
STOCKHOLDERS' EQUITY AND NET LOSS PER SHARE - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Stockholders' Equity and Net Loss Per Share [Line Items] | ||||
Share-based compensation expense | $ 321 | $ 988 | $ 596 | $ 2,398 |
Stock Options | ||||
Stockholders' Equity and Net Loss Per Share [Line Items] | ||||
Option award expiration period | 10 years | |||
Common Stock | ||||
Stockholders' Equity and Net Loss Per Share [Line Items] | ||||
Common stock issuances (in shares) | 382,308 | |||
Common stock issuances | $ 1,300 |
STOCKHOLDERS' EQUITY AND NET 48
STOCKHOLDERS' EQUITY AND NET LOSS PER SHARE - Stock Options Activity (Details) - Stock Options $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2017USD ($)$ / sharesshares | |
Shares | |
Outstanding at beginning of period (in shares) | shares | 7,344,140 |
Granted (in shares) | shares | 2,904,000 |
Forfeited, cancelled or expired (in shares) | shares | (152,101) |
Outstanding at end of period (in shares) | shares | 10,096,039 |
Options exercisable at end of period (in shares) | shares | 7,541,780 |
Weighted-Average Exercise Price (in dollars per share) | |
Outstanding at beginning of period (in dollars per share) | $ / shares | $ 5.01 |
Granted (in dollars per share) | $ / shares | 2.06 |
Forfeited, cancelled or expired (in dollars per share) | $ / shares | 4.42 |
Outstanding at end of period (in dollars per share) | $ / shares | 4.16 |
Options exercisable at end of period (in dollars per share) | $ / shares | $ 4.77 |
Weighted-Average Remaining Contractual Term (in years) | |
Outstanding at end of period | 8 years 5 months 12 days |
Options exercisable at end of period | 8 years |
Aggregate Intrinsic Value (in thousands) | |
Outstanding at end of period | $ | $ 2,149 |
Options exercisable at end of period | $ | $ 540 |
STOCKHOLDERS' EQUITY AND NET 49
STOCKHOLDERS' EQUITY AND NET LOSS PER SHARE - Net Loss Per Share (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2017 | Sep. 20, 2016 | |
Private Placement | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Exercise price (usd per share) | $ 4.85 | |
Antidilutive securities (in shares) | 215,278 | |
China Branding Group Limited | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Exercise price (usd per share) | $ 10 | |
Hotelmobi, Inc. | Warrant | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 1,000,000 | |
Acquisition Warrants | China Branding Group Limited | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Equity interests issued (in shares) | 40,000 | |
Exercise price (usd per share) | $ 10 | |
Acquisition Warrants | Vegas.com LLC | Warrant | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Exercise price (usd per share) | $ 9 | |
Antidilutive securities (in shares) | 8,601,410 | |
Financing Warrants | China Branding Group Limited | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Equity interests issued (in shares) | 2,741,229 | |
Exercise price (usd per share) | $ 5.36 | |
Financing Warrants | Vegas.com LLC | Warrant | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Exercise price (usd per share) | $ 8.33 | |
Antidilutive securities (in shares) | 2,786,535 | |
Warrant One | Hotelmobi, Inc. | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Exercise price (usd per share) | $ 8 | |
Warrant Two | Hotelmobi, Inc. | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Exercise price (usd per share) | $ 12 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Segment Reporting Information [Line Items] | |||||
Net revenue | $ 17,256 | $ 14,975 | $ 32,555 | $ 29,229 | |
Operating loss | (4,677) | (3,503) | (10,057) | (8,679) | |
Adjusted EBITDA | (1,482) | (103) | (3,738) | (1,446) | |
Depreciation, amortization and impairments | (2,894) | (2,479) | (5,755) | (4,876) | |
Share-based compensation expense | (321) | (988) | (596) | (2,398) | |
Other income, net | (1) | (1) | (20) | (30) | |
Other loss | 21 | 68 | 52 | 71 | |
Assets | 101,321 | 101,321 | $ 105,699 | ||
Capital expenditures | 1,785 | 1,469 | |||
Operating Segments | Travel and entertainment segment | |||||
Segment Reporting Information [Line Items] | |||||
Net revenue | 15,288 | 14,234 | 29,481 | 27,777 | |
Operating loss | (322) | 405 | (1,777) | (978) | |
Adjusted EBITDA | 1,763 | 2,418 | 2,367 | 3,063 | |
Depreciation, amortization and impairments | (2,085) | (2,013) | (4,125) | (4,012) | |
Share-based compensation expense | 0 | 0 | 0 | 0 | |
Other income, net | 0 | 0 | (19) | (29) | |
Other loss | 0 | 0 | 0 | 0 | |
Assets | 73,214 | 73,214 | 76,074 | ||
Capital expenditures | 500 | 400 | 900 | 700 | |
Corporate Entity and Other | |||||
Segment Reporting Information [Line Items] | |||||
Net revenue | 1,968 | 741 | 3,074 | 1,452 | |
Operating loss | (4,355) | (3,908) | (8,280) | (7,701) | |
Adjusted EBITDA | (3,245) | (2,521) | (6,105) | (4,509) | |
Depreciation, amortization and impairments | (809) | (466) | (1,630) | (864) | |
Share-based compensation expense | (321) | (988) | (596) | (2,398) | |
Other income, net | (1) | (1) | (1) | (1) | |
Other loss | 21 | $ 68 | 52 | $ 71 | |
Assets | $ 28,107 | $ 28,107 | $ 29,625 |