Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 26, 2018 | Jun. 30, 2017 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Chicken Soup for the Soul Entertainment, Inc. | ||
Entity Central Index Key | 1,679,063 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 0 | ||
Trading Symbol | CSSE | ||
Common Class A [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 3,746,054 | ||
Common Class B [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 7,863,938 | ||
Common Stock [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 11,609,992 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 | |
ASSETS | |||
Cash and cash equivalents | $ 2,172,046 | $ 507,247 | |
Accounts receivable, net | 8,058,352 | 151,417 | |
Prepaid expenses | 228,145 | 216,397 | |
Inventory, net | 368,964 | 0 | |
Intangible asset - video content license | 5,000,000 | 5,000,000 | |
Prepaid distribution fees | 1,892,806 | 592,786 | |
Other intangible asset | 125,000 | 0 | |
Popcornflix film rights and other assets | 7,163,943 | 0 | |
Film library, net | 22,655,645 | 0 | |
Due from affiliated companies | 6,128,629 | 1,372,517 | |
Programming costs, net | 7,651,145 | 3,977,553 | |
Other assets, net | 298,133 | 0 | |
Total assets | 61,742,808 | 11,817,917 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
Senior secured notes payable, net of unamortized debt discount of $0 and $318,992, respectively, and unamortized deferred financing costs of $0 and $40,902, respectively | 0 | 2,610,106 | |
Senior secured notes payable under revolving line of credit to related party, net of unamortized debt discount of $0 and $160,667, respectively, and unamortized deferred financing costs of $0 and $2,845, respectively | 1,500,000 | 3,316,488 | |
Accounts payable and accrued expenses | 1,002,536 | 694,368 | |
Accrued programming costs | 375,761 | 1,061,980 | |
Film library acquisition obligation | 663,400 | 0 | |
Accrued participation costs | 2,620,417 | 0 | |
Other liabilities | 144,533 | 0 | |
Deferred tax liability, net | 257,000 | [1] | 439,000 |
Deferred revenue | 515,000 | 71,429 | |
Total liabilities | 7,078,647 | 8,193,371 | |
Commitments and contingencies | |||
Stockholders' equity | |||
Preferred stock, $.0001 par value, 10,000,000 shares authorized; none issued or outstanding | 0 | 0 | |
Additional paid-in capital | 32,324,500 | 4,074,646 | |
Retained earnings (deficit) | 22,338,501 | (450,996) | |
Total stockholders' equity | 54,664,161 | 3,624,546 | |
Total liabilities and stockholders' equity | 61,742,808 | 11,817,917 | |
Common Class A [Member] | |||
Stockholders' equity | |||
Common Stock, Value, Issued | 374 | 89 | |
Common Class B [Member] | |||
Stockholders' equity | |||
Common Stock, Value, Issued | $ 786 | $ 807 | |
[1] | The Company adjusted its federal deferred income tax assets and liabilities as of December 31, 2017 to reflect the reduction in the U.S. statutory federal corporate income tax rate from 35% to 21% resulting from the provisions of the 2017 Tax Cut and Jobs Act. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Senior Notes [Member] | ||
Debt Instrument, Unamortized Discount | $ 0 | $ 318,992 |
Deferred Costs | 0 | 40,902 |
Line of Credit [Member] | ||
Debt Instrument, Unamortized Discount | 0 | 160,667 |
Deferred Costs | $ 0 | $ 2,845 |
Common Class A [Member] | ||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock, Shares Authorized | 70,000,000 | 70,000,000 |
Common Stock, Shares, Issued | 3,746,054 | 893,369 |
Common Stock, Shares, Outstanding | 3,746,054 | 893,369 |
Common Class B [Member] | ||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Common Stock, Shares, Issued | 7,863,938 | 8,071,955 |
Common Stock, Shares, Outstanding | 7,863,938 | 8,071,955 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue: | ||
Television and film distribution | $ 2,937,678 | $ 0 |
Television and short-form video production | 7,244,998 | 7,720,489 |
Total revenue | 10,979,340 | 8,118,632 |
Less: returns and allowances | (322,339) | 0 |
Net revenue | 10,657,001 | 8,118,632 |
Cost of revenue | 4,735,734 | 3,155,668 |
Gross profit | 5,921,267 | 4,962,964 |
Operating expenses: | ||
Selling, general and administrative (including $638,258 and $1,542,044 of non-cash share-based compensation expense in 2017 and 2016, respectively) | 3,197,446 | 2,370,912 |
Management and license fees | 1,065,700 | 811,863 |
Total operating expenses | 4,263,146 | 3,182,775 |
Operating income | 1,658,121 | 1,780,189 |
Interest income | 10,888 | 13 |
Interest expense (including non-cash amortization of debt discount of $865,833 and $383,712 and amortization of deferred financing costs of $48,247 and $40,859 in 2017 and 2016, respectively) | (1,190,111) | (560,069) |
Acquisition-related costs | (2,193,147) | 0 |
Gain on bargain purchase | 24,321,747 | 0 |
Income before income taxes | 22,607,498 | 1,220,133 |
(Benefit from) provision for income taxes | (182,000) | 439,000 |
Net income and comprehensive income | $ 22,789,498 | $ 781,133 |
Net income per common share: | ||
Basic net income per common share | $ 2.26 | $ 0.09 |
Diluted net income per common share | $ 2.23 | $ 0.09 |
Weighted average basic shares outstanding | 10,063,732 | 8,835,930 |
Weighted average diluted shares outstanding | 10,232,162 | 8,996,636 |
Online [Member] | ||
Revenue: | ||
Net revenue | $ 796,664 | $ 398,143 |
Consolidated Statements of Inc5
Consolidated Statements of Income and Comprehensive Income (Parenthetical) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Allocated Share-based Compensation Expense | $ 638,258 | $ 1,542,044 |
Amortization of Debt Discount (Premium) | 865,833 | 383,712 |
Amortization of Debt Issuance Costs | $ 48,247 | $ 40,859 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity/Members' Deficit - USD ($) | Total | Additional Paid-in Capital [Member] | Members' Deficit [member] | Retained (Deficit) Earnings [Member] | Preferred Stock [Member] | Common Class A [Member]Common Stock [Member] | Common Class B [Member]Common Stock [Member] |
Balance at Dec. 31, 2015 | $ (440,129) | $ 0 | $ (440,129) | $ 0 | $ 0 | $ 0 | $ 0 |
Balance (Shares) at Dec. 31, 2015 | 0 | 0 | |||||
Recapitalization as successor to the operations of Chicken Soup for the Soul Productions, LLC | 860 | 0 | 1,232,129 | (1,232,129) | 0 | $ 0 | $ 860 |
Recapitalization as successor to the operations of Chicken Soup for the Soul Productions, LLC (Shares) | 0 | 8,600,568 | |||||
Shares issued in exchange of Class B membership interest to Trema pursuant to recapitalization | 16 | 792,000 | (792,000) | 0 | 0 | $ 0 | $ 16 |
Shares issued in exchange of Class B membership interest to Trema pursuant to recapitalization (Shares) | 0 | 159,432 | |||||
Sale of Class A Common Stock | 877,251 | 877,234 | 0 | 0 | 0 | $ 17 | $ 0 |
Sale of Class A Common Stock (Shares) | 178,660 | 0 | |||||
Fair value of warrants issued with Term Notes | 553,192 | 553,192 | 0 | 0 | 0 | $ 0 | $ 0 |
Fair value of warrants issued with Credit Facility | 310,179 | 310,179 | 0 | 0 | 0 | 0 | 0 |
Former executive officer exchange of Class B shares for Class A shares pursuant to severance agreement | 0 | 0 | 0 | 0 | 0 | $ 43 | $ (43) |
Former executive officer exchange of Class B shares for Class A shares pursuant to severance agreement (Shares) | 430,028 | (430,028) | |||||
Fair value of Class A shares issued to former executive officer pursuant to severance agreement | 1,436,294 | 1,436,294 | 0 | 0 | 0 | $ 0 | $ 0 |
Shares issued to directors and others for services rendered | 105,750 | 105,747 | 0 | 0 | 0 | $ 3 | $ 0 |
Shares issued to directors and others for services rendered (shares) | 26,664 | 0 | |||||
Conversion of Class B shares to Class A shares upon sale by minority stockholder | 0 | 0 | 0 | 0 | 0 | $ 26 | $ (26) |
Conversion of Class B shares to Class A shares upon sale by minority stockholder (shares) | 258,017 | (258,017) | |||||
Net income | 781,133 | 0 | 0 | 781,133 | 0 | $ 0 | $ 0 |
Balance at Dec. 31, 2016 | 3,624,546 | 4,074,646 | (450,996) | 0 | $ 89 | $ 807 | |
Balance (Shares) at Dec. 31, 2016 | 893,369 | 8,071,955 | |||||
Sale of Class A Common Stock | 23,802,078 | 23,801,854 | 0 | 0 | 0 | $ 224 | $ 0 |
Sale of Class A Common Stock (Shares) | 2,241,983 | 0 | |||||
Sale of Class A Common Stock in private placement net of stock issuance fees of $13,008 | 2,025,654 | 2,025,629 | 0 | 0 | 0 | $ 25 | $ 0 |
Sale of Class A Common Stock in private placement net of stock issuance fees of $13,008 (Shares) | 247,412 | 0 | |||||
Fair value of warrants issued with Term Notes | 333,783 | 333,783 | 0 | 0 | 0 | $ 0 | $ 0 |
Fair value of warrants issued with Credit Facility | 77,193 | 77,193 | 0 | 0 | 0 | 0 | 0 |
Shares issued to directors and others for services rendered | 95,954 | 95,952 | 0 | 0 | 0 | $ 2 | $ 0 |
Shares issued to directors and others for services rendered (shares) | 18,213 | 0 | |||||
Shares issued as part purchase consideration paid for Screen Media acquisition | 281,050 | 281,047 | 0 | 0 | 0 | $ 3 | $ 0 |
Shares issued as part purchase consideration paid for Screen Media acquisition (Shares) | 35,000 | 0 | |||||
Warrants issued as part purchase consideration paid for Screen Media acquisition | 143,500 | 143,500 | 0 | 0 | 0 | $ 0 | $ 0 |
Conversion of Class B shares to Class A shares upon sale by minority stockholder | 0 | 0 | 0 | 0 | 0 | $ 21 | $ (21) |
Conversion of Class B shares to Class A shares upon sale by minority stockholder (shares) | 208,017 | (208,017) | |||||
Conversion of Term Notes to equity | 918,000 | 917,990 | 0 | 0 | 0 | $ 10 | $ 0 |
Conversion of Term Notes to equity (Shares) | 102,060 | 0 | |||||
Share based compensation - stock options | 572,905 | 572,905 | 0 | 0 | 0 | $ 0 | $ 0 |
Rounding difference | 0 | 1 | (1) | ||||
Net income | 22,789,498 | 0 | 0 | 22,789,498 | 0 | 0 | 0 |
Balance at Dec. 31, 2017 | $ 54,664,161 | $ 32,324,500 | $ 0 | $ 22,338,501 | $ 0 | $ 374 | $ 786 |
Balance (Shares) at Dec. 31, 2017 | 3,746,054 | 7,863,938 |
Consolidated Statements of Sto7
Consolidated Statements of Stockholders' Equity/Members' Deficit (Parenthetical) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs | $ 197,600 | |
IPO [Member] | ||
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs | $ 3,101,493 | |
Private Placement [Member] | ||
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs | $ 13,008 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from Operating Activities: | ||
Net income | $ 22,789,498 | $ 781,133 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Share-based compensation | 638,258 | 1,542,044 |
Amortization of programming costs | 2,973,399 | 3,155,668 |
Amortization of deferred financing costs | 43,747 | 40,859 |
Amortization of debt discount | 865,833 | 383,712 |
Amortization of leasehold improvements | 9,819 | 0 |
Amortization of film library | 1,378,869 | 0 |
Bad debt expense | 112,568 | 0 |
Impairment of programming costs | 21,121 | 0 |
Loss on debt extinguishment | 24,803 | 0 |
Gain on bargain purchase of Screen Media | (24,321,747) | 0 |
Deferred income taxes | (182,000) | 439,000 |
Changes in operating assets and liabilities: | ||
Trade accounts receivable | (5,613,851) | (151,417) |
Prepaid expenses and other current assets | 163,972 | (200,199) |
Inventory | (25,656) | 0 |
Programming costs | (6,732,930) | (5,120,254) |
Film library | (1,094,363) | 0 |
Prepaid distribution fees | (1,300,021) | (592,786) |
Other assets | (184,838) | 0 |
Accounts payable and accrued expenses | (596,193) | 671,338 |
Film library acquisition obligation | (60,200) | 0 |
Accrued participation costs | 482,435 | 0 |
Other liabilities | (66,313) | 0 |
Deferred revenue | 443,571 | (3,428,571) |
Net cash used in operating activities | (10,230,219) | (2,479,473) |
Cash flows from Investing Activities: | ||
Payment for acquisition of Screen Media, net of cash acquired | (4,683,814) | 0 |
Due from affiliated companies | (4,756,112) | 739,039 |
Purchase of video content license from affiliate | 0 | (5,000,000) |
Net cash used in investing activities | (9,439,926) | (4,260,961) |
Cash flows from Financing Activities: | ||
Proceeds from revolving credit facility | 4,825,000 | 4,530,000 |
Repayments of revolving credit facility | (6,805,000) | (1,050,000) |
Payment of deferred financing cost | 0 | (84,606) |
Proceeds from notes payable in private placement | 2,030,000 | 2,970,000 |
Repayments of notes payable, from proceeds of IPO | (4,082,000) | 0 |
Payment of stock issuance cost in IPO | (2,330,824) | 0 |
Payment of stock issuance cost in private placements | (618,980) | (197,600) |
Proceeds from issuance of common stock in IPO | 26,903,348 | 0 |
Proceeds from issuance of common stock in private placements | 1,413,400 | 1,075,809 |
Net cash provided by financing activities | 21,334,944 | 7,243,603 |
Net increase in cash and cash equivalents | 1,664,799 | 503,169 |
Cash, cash equivalents and restricted cash at beginning of period | 507,247 | 4,078 |
Cash, cash equivalents and restricted cash at end of the period | 2,172,046 | 507,247 |
Supplemental data: | ||
Interest paid | 298,048 | 110,092 |
Income taxes paid | 52,000 | 0 |
Non-cash operating activity | ||
Fair value of shares issued to executive producer | 625,500 | 0 |
Non-cash investing activities | ||
Fair value of warrants issued for Screen Media acquisition | 143,500 | 0 |
Fair value of Class A common stock issued for Screen Media acquisition | 281,050 | 0 |
Non-cash financing activities | ||
Fair value of warrants issued with revolving credit facility and term notes | 410,976 | 863,370 |
Fair value of shares issued for Trema rights | 0 | 792,000 |
Conversion of senior secured notes payable to Class A common stock | $ 918,000 | $ 0 |
The Company, Description of Bus
The Company, Description of Business, Initial Public Offering and Acquisition | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | Note 1 The Company, Description of Business, Initial Public Offering and Acquisition Chicken Soup for the Soul Entertainment, Inc. (the “Company”) is a Delaware corporation formed on May 4, 2016. CSS Productions, LLC (“CSS Productions”), the Company’s predecessor and immediate parent company, was formed in December 2014 by Chicken Soup for the Soul, LLC (“CSS”), a publishing and consumer products company, and initiated operations in January 2015. The Company was formed to create a discrete entity focused on video content opportunities using the Chicken Soup for the Soul The Company creates and distributes video content under the Brand. The Company has an exclusive, perpetual and worldwide license from CSS to create and distribute video content under the Brand. In May 2016, pursuant to the terms of the contribution agreement among CSS, CSS Productions and the Company (the “CSS Contribution Agreement”), all video content assets (the “Subject Assets”) owned by CSS, CSS Productions and their CSS subsidiaries were transferred to the Company in consideration for its issuance to CSS Productions of 8,600,568 159,432 Thereafter, CSS Productions’ operating activities substantially ceased, and the Company continued the business operations of producing and distributing the video content. The Company is an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has irrevocably elected to avail itself of this exemption from new or revised accounting standards, and, therefore, will not be subject to the same new or revised accounting standards as public companies that are not emerging growth companies. The Company operates in one reportable segment, the production and distribution of video content, and currently operates in the United States and internationally. The Company has entered into a distribution agreement with a company located in the United States that provides for the distribution of an episodic television series in Europe. With the acquisition of Screen Media Ventures, the Company now has a presence in over 56 Initial Public Offering Effective August 17, 2017, the Company completed its Initial Public Offering (“IPO”) of $ 30.0 2,500,000 12.00 2,241,983 258,017 In connection with the consummation of the IPO, the Class A Shares were approved for listing on the Nasdaq Global Market under the symbol “CSSE”. The IPO resulted in gross cash proceeds to the Company of approximately $ 26.9 24.0 4.1 4.5 Acquisition of Screen Media As described more fully in Note 4, on November 3, 2017, the Company acquired all of the membership interests of Screen Media Ventures, LLC (“Screen Media”) for approximately $ 4.9 35,000 50,000 12 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | Note 2 Summary of Significant Accounting Policies The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (‘‘GAAP’’). All intercompany balances and transactions have been eliminated in consolidation. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting periods. The Company’s significant estimates include those related to revenue recognition, accounts receivable allowances, intangible assets, share-based compensation expense, income taxes and amortization of programming costs. Actual results could differ from those estimates. Cash and cash equivalents include highly liquid investments with original maturities of three months or less and consist primarily of money market funds. Such investments are stated at cost, which approximates fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measurements, a three-tier fair value hierarchy, which prioritizes the inputs used in the valuation methodologies, is as follows: Level 1Valuations based on quoted prices for identical assets and liabilities in active markets. Level 2Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Level 3Valuations based on unobservable inputs reflecting our own assumptions. These valuations require significant judgment and estimates. At December 31, 2017 and 2016, the fair value of the Company’s financial instruments including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, accrued participation costs, film library acquisition costs and accrued programming costs, approximated their carrying value due primarily to the relative short-term nature of these instruments. Accounts receivable are stated at the amounts management expects to collect and are subsequently stated net of allowance for uncollectible accounts and video returns. An allowance for doubtful accounts is recorded based on a combination of historical experience, aging analysis and information on specific accounts. Account balances are written off against the allowance after all means of collections have been exhausted and the potential for recovery is considered remote. Accounts are considered past due or delinquent based on contractual terms and how recently payments have been received. Estimated losses resulting from uncollectible accounts are reported as bad debt expense in the consolidated statements of income and comprehensive income. At December 31, 2017, accounts receivable are presented net of allowance for doubtful accounts and video returns of $ 597,665 112,568 Inventory consists of DVD films held for resale to wholesale and retail customers. Inventory is stated at the lower of cost or market. Cost is determined by the first-in, first-out (FIFO) method. Market value is based on net realizable value. When the net realizable value falls below its cost, a provision for write-downs is recorded. Programming costs include the unamortized costs of completed, in-process, or in-development long-form and short-form video content. For video content, the Company’s capitalized costs include all direct production and financing costs, capitalized interest when applicable, and production overhead. The costs of producing video content are amortized using the individual-film-forecast method. These costs are amortized in the proportion that current period’s revenue bears to management’s estimate of ultimate revenue expected to be recognized from each production. For an episodic television series, the period over which ultimate revenue is estimated cannot exceed ten years following the date of delivery of the first episode, or, if still in production, five years from the date of delivery of the most recent episode, if later. Programming costs are stated at the lower of amortized cost or estimated fair value. The valuation of programming costs is reviewed on a title-by-title basis, when an event or change in circumstances indicates that the fair value may be less than its unamortized cost and the valuation is based on a discounted cash flows (“DCF”) methodology with assumptions for cash flows. Key inputs employed in the DCF methodology include estimates of a program’s ultimate revenue and costs as well as a discount rate. The discount rate utilized in the DCF is based on the weighted average cost of capital of the Company plus a risk premium representing the risk associated with producing a particular program. The Company performs an annual impairment analysis for unamortized programming costs. An impairment charge is recorded in the amount by which the unamortized costs exceed the estimated fair value. Estimates of future revenue involve measurement uncertainties and it is therefore possible that reductions in the carrying value of programming costs may be required as a consequence of changes in management’s future revenue estimates. Included in cost of revenue in the consolidated statements of income and comprehensive income for 2017 and 2016, is amortization of programming costs totaling $ 2,973,399 3,155,668 The film library represents the cost of acquiring film distribution rights and related acquisition and accrued participation costs. The film library is amortized using the individual-film-forecast-computation method. Film library is stated at the lower of unamortized cost or fair value. Amortization is based upon management’s best estimate of total future, or ultimate revenue. Amortization is adjusted when necessary to reflect increases or decreases in forecasted ultimate revenues. Ultimate revenue time frame is determined based on the term of the acquisition agreement, which in most cases is ten years or more. The company generally acquires distribution rights covering periods of ten or more years. Included in cost of revenue in the consolidated statements of income and comprehensive income for the years ended December 31, 2017 and 2016 is amortization of film library totaling $ 1,378,869 0 Popcornflix film rights and other assets represents the direct-to-consumer online video service and application platform comprised of five ad-supported networks with rights to over 3,000 films and approximately 60 television series. Popcornflix is an indefinite-lived intangible and is not subject to amortization but annual impairment analysis. For the year ended December 31, 2017, there was no material impairment charge recorded. The Company was formed on May 4, 2016 as a Sub-Chapter C corporation for federal and state tax purposes. As such, the Company filed its first tax return for the year ended December 31, 2016. Prior to May 4, 2016, CSS Productions had elected to be treated as a partnership for federal and state income tax purposes and, accordingly, no provision was made for income taxes prior to that date. CSS Productions has not been audited by the taxing authorities. If taxable income is adjusted as a result of an audit for periods prior to May 4, 2016, then CSS Productions may be required to make distributions to satisfy its members’ tax obligations. Any such distributions would not be made from, or be the responsibility of, the Company. The Company records income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred taxes are also recognized for operating losses that are available to offset future taxable income. A valuation allowance is established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be realized or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company accounts for uncertain tax positions in accordance with the authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 740: Income Taxes The Company includes interest and penalties related to its uncertain tax positions as part of income tax expense within its consolidated statements of income and comprehensive income. At December 31, 2017 and 2016, the Company did not have any unrecognized tax benefits or liabilities. See Note 13 for additional information. The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If the sum of the expected future cash flows, undiscounted and without interest, is less than the carrying amount of the asset, an impairment loss is recognized as the amount by which the carrying amount of the asset exceeds its fair value. Film library acquisition obligations represent amounts due in connection with the Company acquiring film distribution rights. Pursuant to the film distribution rights agreements, the Company’s right to distribute films may revert to the licensor in the event that the Company is unable to satisfy its financial obligations with respect to the acquisition of the related distribution rights. The Company accrues for participation costs due to production companies and producers based on the respective agreements. Amounts due to production companies and producers are calculated based on gross revenue for each film after exceeding certain minimum targets. In addition, the Company must recoup its original investment in each film before such payments are due. Accrued participation costs are capitalized and amortized as part of the film library. Revenue from online digital distribution and VOD platforms are recorded when monthly activity is reported by advertisers. For theatrical releases, revenue is recorded after the theatrical release date and when box office proceeds reports are received. Revenue generated under the distribution agreement with A Sharp, Inc., d/b/a A Plus (“A Plus”) is reported on a net basis as the Company earns a commission on the distribution of A Plus’ content (see Note 14). Revenue from all digital media distribution is included in online networks in the accompanying consolidated statements of income and comprehensive income. The Company licenses and distributes multi-film packages to its customers. Revenue from multi-film sales is allocated on a per title basis and recognized upon initial availability for exploitation by customers. In addition, the Company distributes DVDs and similar media to its customers. The Company recognizes revenue upon shipment of DVD units or similar media units to its customers. Provision for future returns and other allowances are established based upon historical experience. Revenue from the distribution of multi-film packages and DVDs and similar media is included in television and film distribution in the accompanying consolidated statements of income and comprehensive income. The Company recognizes revenue from the production and distribution of television programs and short-form video content in accordance with Accounting Standards Codification Topic 926: Entertainment Films Cash advances received by the Company are recorded as deferred revenue until all the conditions of revenue recognition have been met. The Company accounts for share-based payments in accordance with ASC 718: Share-based compensation, which establishes the accounting for transactions in which an entity exchanges its equity instruments for goods or services. Under the provisions of the authoritative guidance, share-based compensation expense is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period, net of estimated forfeitures. Shares issued for services are based upon current selling prices of the Company’s Class A common stock or independent third party valuations. The Company estimates the fair value of share-based instruments using the Black-Scholes option-pricing model. All share-based awards are fulfilled with new shares of Class A common stock. For the years ended December 31, 2017 and 2016, share-based awards were issued to non-employee directors and individuals for services rendered and were recorded at fair value. Generally, advertising costs are expensed as incurred except for the advertising costs associated with the Company’s theatrically released titles which the Company is obligated to make reimbursements for. The expense recorded in the consolidated statements of income and comprehensive income for the year ended December 31, 2017 was $ 63,875 2,000 Basic net income per common share is computed based on the weighted average number of shares of all classes of common stock outstanding. Diluted net income per common share is computed based on the weighted average number of common shares outstanding increased, when applicable, by dilutive common stock equivalents, comprised of Class W warrants, Class Z warrants and stock options outstanding. For 2016, basic and diluted net income per common share assumes that Class B common stock of the Company issued pursuant to the Contribution Agreement and the resulting recapitalization of the Company is issued and outstanding as of January 1, 2016. In computing the effect of dilutive common stock equivalents, the Company uses the treasury stock method to calculate the related incremental shares. In applying the treasury stock method, prior to its IPO the Company used a share price of $ 12 The Company maintains cash balances at its bank. Accounts for each entity are insured by the Federal Deposit Insurance Corporation subject to certain limitations. At various times during the fiscal year, the Company’s cash in bank balances exceeded the federally insured limits. The uninsured balances at December 31, 2017 and December 31, 2016 were $ 1,422,001 5,600 Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash in bank, revenue and accounts receivable. For the year ended December 31, 2017, we had 4 customers, which accounted for 77 52 73 58 94 46 Certain prior year balances have been reclassified to conform to the current year presentation. In the consolidated statements of income and comprehensive income, prior year revenue has been presented in a manner more representative of the Company’s current revenue streams. These reclassifications have no effect on previously reported net income. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | Note 3 Recent Accounting Pronouncements In May 2017, the FASB issued Accounting Standards Update (“ASU”) 2017-09, Compensation Stock Compensation Topic 718: Scope of Modification Accounting ASU 2017-09 is intended to reduce diversity in practice and result in fewer changes to the terms of an award being accounted for as a modification. Under this guidance, an entity will not apply modification accounting to a share-based payment award if the award’s fair value, vesting conditions and balance sheet classification remain the same before and after the change. ASU 2017-09 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017 for all entities. Early adoption is permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements and does not expect it to have a significant impact. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In November 2016, the FASB issued ASU 2016-18, Restricted Cash In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) |
Business Combination
Business Combination | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | Note 4 Business Combination Effective November 3, 2017, the Company completed the acquisition of all of the membership interests of Screen Media for approximately $ 4.9 35,000 50,000 12 5.3 Purchase Price Consideration Allocation: Cash consideration $ 4,905,355 Equity consideration - Class A common stock 281,050 Equity consideration - Class Z warrants 143,500 Purchase price consideration 5,329,905 Less: cash acquired (221,541) Total purchase consideration, less cash acquired $ 5,108,364 Purchase price consideration allocated to fair value of net assets acquired: Accounts receivable, net $ 2,405,654 Prepaid expenses 175,719 Video inventory 343,308 Property and equipment, net 123,115 Other intangible asset 125,000 Popcornflix film rights and other assets 7,163,943 Film library, net 22,940,151 Assets acquired 33,276,890 Accounts payable and accrued expenses (774,350) Customer deposits (210,846) Accrued participations payable (2,137,983) Film obligations (723,600) Liabilities assumed (3,846,779) Gain on bargain purchase (24,321,747) Total purchase consideration, less cash acquired $ 5,108,364 The fair value of the Screen Media film library, as well as the Popcornflix film rights and other assets, were the most significant assets recorded from the acquisition of Screen Media. In determining the fair value of these assets, the independent third-party appraiser utilized an income-based approach (“DCF”). Under the income-based approach, the third-party appraiser calculated the net present value (“NPV”) of after-tax cash flows as expected from the film library and from Popcornflix. The NPV was added to a terminal or exit value for these assets to obtain estimates of fair value. Based on the fair value of the net assets acquired, the acquisition of Screen Media resulted in a gain on bargain purchase of $ 24.3 Aggregate acquisition-related costs related to the Purchase, including legal fees, accounting fees and investment advisory fees is approximately $ 2.2 The Company’s consolidated statement of income and comprehensive income include net revenue of $ 3.0 0.6 The following combined unaudited pro forma information assumes the acquisition of Screen Media occurred on January 1, 2016 (the “Unaudited Information”). The Unaudited Information presented below is for illustrative purposes only and does not reflect future events that may occur after December 31, 2017 or any operating efficiencies or inefficiencies that may result from the acquisition of Screen Media’s operations. The Unaudited Information is not necessarily indicative of results that would have been achieved had the Company controlled Screen Media’s operations during the periods presented or the results that the Company will experience going forward. Pro forma net loss for the year ended December 31, 2016, includes $ 2.1 Year Ended December 31, (Unaudited) 2017 2016 Net revenue $ 18,836,046 $ 21,656,282 Cost of revenue 8,925,863 8,828,745 Gross profit 9,910,183 12,827,537 Operating expenses 12,312,030 13,147,035 Net loss (3,269,071) (963,554) Net loss per common share: Basic net loss per common share (0.32) (0.11) Diluted net loss per common share (0.32) (0.11) |
Episodic Television Programs
Episodic Television Programs | 12 Months Ended |
Dec. 31, 2017 | |
Contractors [Abstract] | |
Long-term Contracts or Programs Disclosure [Text Block] | Note 5 Episodic Television Programs (a) Chicken Soup for the Soul’s Hidden Heroes (“Hidden Heroes”) Hidden Heroes (b) Project Dad, a Chicken Soup for the Soul Original Project Dad Project Dad The Project Dad Project Dad In 2017, the Sponsor funded a new parenting series called Being Dad, (c) Vacation Rental Potential. This series, comprised of eight, one-hour episodes began airing on the A&E Network in November 2017. The show gives viewers the information and inspiration needed to realize their dreams of using real estate entrepreneurship to obtain financial success. HomeAway.com has agreed to fund a second season of Vacation Rental Potential. In accordance with ASC 926 as amended, the Company has recognized revenue for Hidden Heroes, Project Dad, Being Dad Vacation Rental Potential |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | Note 6 Share-Based Compensation Effective January 1, 2017, the Company adopted the 2017 Long Term Incentive Plan (the “Plan”) to attract and retain certain employees. The Plan provides for the issuance of up to one million common stock equivalents subject to the terms and conditions of the Plan. The Plan generally provides for quarterly and bi-annual vesting over terms ranging from two to three years. The Company accounts for the Plan as an equity plan. The Company recognized these stock options at fair value determined by applying the Black Scholes options pricing model to the grant date market value of the underlying common shares of the Company. The compensation expense associated with these stock options is amortized on a straight-line basis over their respective vesting periods. For the year ended December 31, 2017, the Company recognized $ 572,905 199,585 As of December 31, 2017 Number of Stock Options Weighted Average Exercise Price Weighted Average Remaining Aggregate Intrinsic Value Total outstanding at the beginning of the period - $ - - $ - Options granted 690,000 7.61 1.91 1,079,500 Options exercised - - - - Actual options forfeited - - - - Options expired - - - - Total outstanding at December 31, 2017 690,000 $ 7.61 1.91 $ 1,079,500 Total exercisable at December 31, 2017 199,585 6.73 1.29 452,462 Total unvested at December 31, 2017 490,415 7.96 2.17 627,038 Total vested or expected to vest - December 31, 2017 690,000 7.61 1.91 1,079,500 As of December 31, 2017, the Company had unrecognized pre-tax compensation expense of $ 1,723,650 901,018 494,518 328,112 Number of Stock Options Weighted Average Exercise Price Total unvested - December 31, 2016 - $ - Granted 690,000 3.33 Vested (199,585) 2.66 Cancellations - - Total unvested - December 31, 2017 490,415 3.60 Weighted Average Valuation assumptions: Expected dividend yield 0 % Expected equity volatility 57 % Expected term (years) 2.57 Risk-free interest rate 2.05 % Exercise price per stock option $ 7.61 Market price per share $ 6.92 Weighted average fair value per stock option $ 3.33 The risk-free rates are based on the implied yield available on US Treasury constant maturities with remaining terms equivalent to the respective expected terms of the options. The Company estimates expected terms for stock options awarded to employees using the simplified method in accordance with ASC 718, Stock Compensation The Company also awards common stock grants to directors and non-employee executive producers that provide services to the Company. For the years ended December 31, 2017 and 2016, the Company recognized in selling, general and administrative expense, non-cash share-based compensation expense of $ 638,258 1,542,044 Included in non-cash share-based compensation expense for the year ended December 31, 2016, is the fair value of share-based awards that were issued to a former officer of the Company. The fair value of the former officer’s shares was determined to be $ 1,436,294 Additionally, for the year ended December 31, 2017, the Company capitalized as programming costs, the fair value of Class A common stock and Class Z warrants totaling $ 625,500 In January 2018, the Company’s board of directors approved an increase, subject to stockholder approval, to the number of shares available for grant pursuant to the Plan to 1,250,000 1,000,000 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | Note 7 Earnings Per Share Year Ended December 31, 2017 2016 Basic weighted-average shares outstanding 10,063,732 8,835,930 Effect of dilutive securities: Assumed issuance of shares from exercise of stock options 50,274 - Assumed issuance of shares from exercise of warrants 118,156 160,706 Diluted weighted-average shares outstanding 10,232,162 8,996,636 |
Programming Costs
Programming Costs | 12 Months Ended |
Dec. 31, 2017 | |
Research and Development [Abstract] | |
Research, Development, and Computer Software Disclosure [Text Block] | Note 8 Programming Costs December 31, 2017 2016 Released, net of accumulated amortization of $6,725,362 and $3,801,963, respectively $ 6,218,499 $ 3,228,440 In production 12,784 100,000 In development 1,419,862 649,113 $ 7,651,145 $ 3,977,553 |
Film Library
Film Library | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Film Library [Abstract] | |
Film Library [Text Block] | Note 9 Film Library Film library costs, net of amortization, consists of the following at December 31, 2017: Acquisition costs $ 24,034,514 Accumulated amortization (1,378,869) Net film library costs $ 22,655,645 |
Intangible Asset - Video Conten
Intangible Asset - Video Content License | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets Disclosure [Text Block] | Note 10 Intangible Asset - Video Content License The Company has been granted a perpetual, exclusive license from CSS to utilize the Brand and related content, for visual exploitation on a worldwide basis (“Perpetual License”). In granting the Perpetual License, CSS required an initial purchase price of $ 5,000,000 |
Senior Secured Notes Payable an
Senior Secured Notes Payable and Senior Secured Revolving Line of Credit | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | Note 11 Senior Secured Notes Payable and Senior Secured Revolving Line of Credit Senior Secured Notes Payable From July 2016 through May 2017, the Company sold in a private placement (“Debt Private Placement”) $ 5,000,000 5 460,000 7.50 In June 2017, at the election of certain Noteholders, the Company converted $ 918,000 102,060 9 30,618 12 The Term Notes ranked pari passu The Term Notes were repaid in full on August 18, 2017 from the proceeds of the IPO. The Term Notes and the Warrants were accounted for in accordance with ASC 470: Debt The Warrants are exercisable at any time prior to June 30, 2021 and are callable under certain circumstances, but in no event prior to January 31, 2018. The fair value of the Warrants was determined to be $ 1,079,360 For the year ended December 31, 2017, amortization of the debt discount of $ 627,973 40,902 136,526 234,201 37,304 50,727 Officers of the Company and of CSS, and their family members, participated in the Debt Private Placements on the same terms and conditions as other investors (see Note 12). Senior Secured Revolving Line of Credit On May 12, 2016, the Company entered into the Credit Facility with an entity controlled by its chief executive officer (the “Lender”). Under the amended terms of the Credit Facility, the Company can borrow up to an aggregate of $ 4,500,000 Advances made under the Credit Facility are used for working capital and general corporate purposes, and were used in part, for payments in 2016 due to CSS pursuant to the license agreement with the Company. Borrowings under the Credit Facility bear interest at 5 0.75 If payment obligations under the Credit Facility are still outstanding at the Maturity Date, or, if prior to the Maturity Date there is an event of default as prescribed by the Credit Facility, then, at the option of the Company, (a) all principal and interest may be exchanged into shares of Class A common stock of the Company on the same terms as the Company’s most recently completed equity financing, provided, that under no circumstances shall the pre-money valuation used for this exchange be less than $ 52,560,000 157,500 7.50 All Warrants issued to the Lender expire on May 12, 2021 The Credit Facility and the related warrants were accounted for in accordance with ASC 470, which provides, among other things, that the fair value is allocated between the debt and the related warrants. The fair value of the warrants issued was determined to be $ 424,025 For the year ended December 31, 2017, amortization of the debt discount of $ 237,860 2,845 139,504 149,511 3,555 81,703 The balance outstanding under the Credit Facility of $ 4.5 4.5 1,500,000 1,700,000 |
Stockholders_ Equity
Stockholders’ Equity | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | Note 12 Stockholders’ Equity Equity Structure The Company is authorized to issue 70,000,000 0.0001 20,000,000 0001 10,000,000 0001 3,746,054 893,369 7,863,938 8,071,955 Each holder of Class A Stock is entitled to one vote per share while holders of Class B Stock are entitled to ten votes per share. Recapitalization As described in Note 1, in May 2016, pursuant to the terms of the CSS Contribution Agreement, the Company issued 8,600,568 Concurrently with the consummation of the CSS Contribution Agreement, certain rights to receive payments under certain agreements comprising part of the Subject Assets owned by Trema, LLC (“Trema”), a company principally owned and controlled by William J. Rouhana, Jr., the Company’s chairman and chief executive officer, were assigned to the Company under a contribution agreement (the “Trema Contribution Agreement”) in consideration for the Company’s issuance to Trema of 159,432 16 792,000 Equity Private Placements Between June 2016 and May 2017, the Company sold Class A common stock in two private placements. From June 2016 through November 2016, the Company sold in a private placement (the “2016 Equity Private Placement”) a total of 17,096 1,025,760 170,960 51,288 The purchase price of each unit was $ 60 7.50 June 30, 2021 From November 2016 and through May 2017, the Company sold in a private placement (the “2017 Equity Private Placement”) a total of 15,011 975,710 150,112 45,034 The purchase price of each unit was $ 65 7.50 June 30, 2021 Family members of officers of the Company and of CSS participated in the 2016 Equity Private Placement and the 2017 Equity Private Placement on the same terms and conditions as other investors (see Note 14). In two separate transactions, other parties purchased a total of 55,000 50,000 487,500 Executive Producer Shares As described in Note 6, in June 2017 the Company issued 50,000 50,000 12 625,500 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | Note 13 Income Taxes Year Ended December 31, 2017 2016 Current provision (benefit): Federal $ - $ - States - - Total current provision - - Deferred (benefit) provision: Federal (142,000) 355,000 States (40,000) 84,000 Total deferred (benefit) provision (182,000) 439,000 Total (benefit) provision for income taxes $ (182,000) $ 439,000 The (benefit) provision for income taxes is different from amounts computed by applying U.S. statutory rates to consolidated earnings before taxes. Year Ended December 31, 2017 2016 Expected tax provision Income taxes computed at Federal statutory rate (35% for 2017; 34% for 2016) $ 7,912,000 $ 414,000 Increase (decrease) in tax expense resulting from: - Gain on bargain purchase (8,512,000) - Amortization of debt discount 303,000 - State and local taxes (12,000) 85,000 Tax on pre-incorporation income of predecessor - (177,000) Programming costs (178,000) - Acquisition-related costs 204,000 - Film library 130,000 - Other (29,000) 117,000 Actual tax (benefit) provision $ (182,000) $ 439,000 Deferred income taxes reflect the temporary differences between the financial statement carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, adjusted by the relevant tax rate. December 31, 2017 (1) 2016 Deferred tax assets: Net operating loss carry-forwards $ 318,000 $ 481,000 Acquisition-related costs 584,000 - Film library 371,000 - Other liabilities - 36,000 Total deferred tax assets 1,273,000 517,000 Deferred tax liabilities: Programming costs 1,389,000 886,000 Other assets 141,000 70,000 Total deferred tax liabilities 1,530,000 956,000 Net deferred tax liability $ 257,000 $ 439,000 (1) The Company adjusted its federal deferred income tax assets and liabilities as of December 31, 2017 to reflect the reduction in the U.S. statutory federal corporate income tax rate from 35 21 The Company has approximately $ 1,515,000 1,389,000 126,000 Internal Revenue Code Section 382 imposes limitations on the use of net operating loss carryovers when the stock ownership of one or more 5% stockholders (stockholders owning 5% or more of the Company’s outstanding capital stock) has increased by more than 50 percentage points. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | Note 14 Related Party Transactions (a) Affiliate Resources and Obligations In May 2016, the Company entered into agreements with CSS and affiliated companies that provide the Company with access to important assets and resources as described below (the “2016 Agreements”). The 2016 Agreements include a management services agreement and a license agreement. A summary of the 2016 Agreements is as follows: Management Services Agreement The Company is a party to a Management Services Agreement with CSS (the “Management Agreement”). Under the terms of the Management Agreement, the Company is provided with the operational expertise of the CSS companies’ personnel, including its chief executive officer. Pursuant to the Management Agreement, the Company also receives other services, including accounting, legal, marketing, management, data access and back office systems, and requires CSS to provide office space and equipment usage. Under the terms of the Management Agreement, commencing with the fiscal quarter ended March 31, 2016, the Company paid a quarterly fee to CSS equal to 5 Since the completion of the IPO, the Company reports under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the quarterly fee is based on gross revenue as reported in the applicable public filing under the Exchange Act for each fiscal quarter. For the years ended December 31, 2017 and 2016, the Company recorded management fee expense of $ 532,850 405,932 Each quarterly amount due shall be paid on or prior to the later of the 45th day after the end of such quarter, or the 10th day after the filing of the applicable Exchange Act report for such quarter. On August 21, 2017, the Company paid to CSS $ 739,422 In addition, for any sponsorship that is arranged by CSS for the Company’s video content or that contains a multi-element transaction for which the Company receives a portion of such revenue and CSS receives the remaining revenue (for example, a transaction that relates to both video content and CSS’s printed products), the Company shall pay a sales commission to CSS equal to 20 The term of the Management Agreement is five years, with automatic one-year renewals thereafter unless either party elects to terminate by delivering written notice at least 90 days prior to the end of the then current term. The Management Agreement is terminable earlier by either party by reason of certain prescribed and uncured defaults by the other party. The Management Agreement will automatically terminate in the event of the Company’s bankruptcy or a bankruptcy of CSS or if the Company no longer has licensed rights from CSS under the License Agreement described below. License Agreement The Company is a party to a trademark and intellectual property license agreement with CSS (the “License Agreement”). Under the terms of the License Agreement, the Company has been granted a perpetual, exclusive license to utilize the Brand and related content, such as stories published in the Chicken Soup for the Soul books, for visual exploitation worldwide. In consideration of the License Agreement, in May 2016 the Company paid to CSS a one-time license fee of $ 5,000,000 1,500,000 3,500,000 0.5 The Note was due on the earlier of (a) five business days after the date of written demand by CSS and (b) the third business day following the closing date of an initial public offering of the common stock of the Company. The Note was repaid in full by September 16, 2016. Included in interest expense in the accompanying consolidated statement of income and comprehensive income for the year ended December 31, 2016 is $ 3,069 Under the terms of the License Agreement, commencing with the fiscal quarter ended March 31, 2016, the Company also pays an incremental recurring license fee to CSS equal to 4 Since the completion of the IPO, the Company reports under the Exchange Act and the quarterly fee is based on gross revenue as reported in the applicable public filing under the Exchange Act for each fiscal quarter. Each quarterly amount shall be paid on or prior to the later of the 45th day after the end of such quarter, or the 10 th 572,172 In addition, CSS provides marketing support for the Company’s productions through its email distribution, blogs and other marketing and public relations resources. Commencing with the fiscal quarter ended March 31, 2016, the Company shall pay a quarterly fee to CSS equal to 1 532,850 405,932 Due from Affiliated Companies As of December 31, 2017, the Company is owed $ 6,128,629 4.7 As noted above, advances and repayments occur periodically. In the first quarter of 2018, CSS repaid $1.0 million of such net advances it owed to the Company. As a result of this repayment, the amount due from affiliates is approximately the same compared to December 31, 2017. The Company and CSS expect the remaining net balance to be reduced substantially during the remainder of 2018. The Company and CSS do not charge interest on the net advances or the net repayments. (b) In September 2016, a wholly-owned subsidiary of CSS acquired a majority of the issued and outstanding common stock of A Plus. A Plus develops and distributes high quality, empathetic short-form videos and articles to millions of people worldwide. A Plus is a digital media company founded, chaired, and partially owned by actor and investor Ashton Kutcher. Mr. Kutcher owns 23 2 75 In September 2016, the Company entered into a distribution agreement with A Plus (the “A Plus Distribution Agreement”). The A Plus Distribution Agreement has an initial term ending in September 2023. Under the terms of the A Plus Distribution Agreement, the Company has the exclusive worldwide rights to distribute all video content (in any and all formats) and all editorial content (including articles, photos and still images) created, produced, edited or delivered by A Plus. Under the terms of the A Plus Distribution Agreement, the Company paid A Plus an advance of $ 3,000,000 The Company is entitled to retain a net distribution fee of 30 40 5 15 The Company will not pay A Plus its portion of gross revenue until such time as the A Plus Advance has been recouped in full. At December 31, 2017 and 2016, prepaid distribution fees were $ 1,892,806 592,786 Online revenue in the Company’s consolidated statement of income and comprehensive income for the years ended December 31, 2017 and 2016 includes $ 339,977 398,143 (c) Officers of the Company and of CSS, and their family members (“Related Parties”), made purchases under the Debt Private Placement, the 2016 Equity Private Placement, and the 2017 Equity Private Placement on the same terms and conditions as offered to other investors. Prior to the IPO, Related Parties purchased $ 1,413,140 2,030,000 1,340,000 200,040 (d) CSS Productions had a consulting agreement with Low Profile Films, Inc. (“Low Profile”). Low Profile provided executive production services for the Company that included all activities necessary to establish and maintain relationships regarding CSS Productions proposed feature length film, a possible talk show and, Low Profile was to oversee the production to facilitate the public viewing or distribution of same. The owner of Low Profile is the son of the Company’s chairman and chief executive officer. In July 2016, the Company and Low Profile mutually agreed to terminate the executive production services agreement. During 2016, the Company paid Low Profile $ 35,000 (e) During 2016, the Company entered into a Promotions License Agreement with One Last Thing (“OLT”) under which the Company paid $ 100,000 100,000 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | Note 15 Commitments and Contingencies In the normal course of business, from time-to-time, the Company may become subject to claims in legal proceedings. Legal proceedings are subject-to inherent uncertainties, and an unfavorable outcome could include monetary damages, and in such event, could result in a material adverse impact on the Company's business, financial position, results of operations, or cash flows. The Company is not currently, and has not been since inception, subject to any legal claims or actions. Further, the Company has no knowledge of any pending legal actions and does not believe it is currently a party to any pending legal claims or actions. The Company is contingently liable for a standby letter of credit in connection with its office lease agreement in the amount of $ 129,986 Year Ended December 31, Amount 2018 $ 408,025 2019 417,206 2020 71,043 $ 896,274 Rent expense recorded in the consolidated statements of income and comprehensive income for the years ended December 31, 2017 and 2016 was $ 67,951 0 |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | Note 16 Segment Reporting The Company’s reportable segments have been determined based on the distinct nature of its operations, the Company's internal management structure, and the financial information that is evaluated regularly by the Company's chief operating decision maker. The Company operates in one reportable segment, the production and distribution of video content, and currently operates in the United States and internationally. The Company has entered into a distribution agreement with a company located in the United States that provides for the distribution of an episodic television series in Europe. With the acquisition of Screen Media, the Company now has presence in over 56 countries worldwide. Year Ended December 31, 2017 2016 United States $ 10,853,428 $ 8,118,632 Canada 8,118 - Europe 31,037 - Other foreign 86,756 - $ 10,979,340 $ 8,118,632 One customer represented 28 46 3.0 3.7 24 11 2.5 1.1 10 58 100 10 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | Note 17 Subsequent Events On March 27, 2018, the board of directors of the Company gave approval for the Company to enter into a commercial loan with a bank. On March 10, 2018, the Company agreed to a proposal with a bank to provide the Company with a term loan facility and a revolving line of credit totaling $ 7.5 5.0 5.75 2.5 prime rate plus 1.5% As described in Note 6 above, in January 2018, the Company’s board of directors approved an increase, subject to stockholder approval, to the number of shares available for grant pursuant to the Company’s Plan to 1,250,000 1,000,000 On March 27, 2018, the board of directors of the Company approved a stock repurchase program (the “Repurchase Program”) that enables the Company to repurchase up to $ 5 Under the Repurchase Program, the Company may purchase its shares of Class A common stock through various means, including open market transactions, privately negotiated transactions, tender offers or any combination thereof. The number of shares repurchased and the timing of repurchases will depend on a number of factors, including, but not limited to, stock price, trading volume and general market conditions, along with our working capital requirements, general business conditions and other factors. The Repurchase Program may be modified, suspended or terminated at any time by the board of directors. Repurchases under the Repurchase Program will be funded from our existing cash and cash equivalents or future cash flow and equity or debt financings. |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (‘‘GAAP’’). All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting periods. The Company’s significant estimates include those related to revenue recognition, accounts receivable allowances, intangible assets, share-based compensation expense, income taxes and amortization of programming costs. Actual results could differ from those estimates. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents Cash and cash equivalents include highly liquid investments with original maturities of three months or less and consist primarily of money market funds. Such investments are stated at cost, which approximates fair value. |
Fair Value Measurement, Policy [Policy Text Block] | Fair Value Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measurements, a three-tier fair value hierarchy, which prioritizes the inputs used in the valuation methodologies, is as follows: Level 1Valuations based on quoted prices for identical assets and liabilities in active markets. Level 2Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Level 3Valuations based on unobservable inputs reflecting our own assumptions. These valuations require significant judgment and estimates. At December 31, 2017 and 2016, the fair value of the Company’s financial instruments including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, accrued participation costs, film library acquisition costs and accrued programming costs, approximated their carrying value due primarily to the relative short-term nature of these instruments. |
Trade and Other Accounts Receivable, Policy [Policy Text Block] | Accounts Receivable Accounts receivable are stated at the amounts management expects to collect and are subsequently stated net of allowance for uncollectible accounts and video returns. An allowance for doubtful accounts is recorded based on a combination of historical experience, aging analysis and information on specific accounts. Account balances are written off against the allowance after all means of collections have been exhausted and the potential for recovery is considered remote. Accounts are considered past due or delinquent based on contractual terms and how recently payments have been received. Estimated losses resulting from uncollectible accounts are reported as bad debt expense in the consolidated statements of income and comprehensive income. At December 31, 2017, accounts receivable are presented net of allowance for doubtful accounts and video returns of $ 597,665 112,568 |
Inventory, Policy [Policy Text Block] | Inventory Inventory consists of DVD films held for resale to wholesale and retail customers. Inventory is stated at the lower of cost or market. Cost is determined by the first-in, first-out (FIFO) method. Market value is based on net realizable value. When the net realizable value falls below its cost, a provision for write-downs is recorded. |
Research, Development, and Computer Software, Policy [Policy Text Block] | Programming Costs Programming costs include the unamortized costs of completed, in-process, or in-development long-form and short-form video content. For video content, the Company’s capitalized costs include all direct production and financing costs, capitalized interest when applicable, and production overhead. The costs of producing video content are amortized using the individual-film-forecast method. These costs are amortized in the proportion that current period’s revenue bears to management’s estimate of ultimate revenue expected to be recognized from each production. For an episodic television series, the period over which ultimate revenue is estimated cannot exceed ten years following the date of delivery of the first episode, or, if still in production, five years from the date of delivery of the most recent episode, if later. Programming costs are stated at the lower of amortized cost or estimated fair value. The valuation of programming costs is reviewed on a title-by-title basis, when an event or change in circumstances indicates that the fair value may be less than its unamortized cost and the valuation is based on a discounted cash flows (“DCF”) methodology with assumptions for cash flows. Key inputs employed in the DCF methodology include estimates of a program’s ultimate revenue and costs as well as a discount rate. The discount rate utilized in the DCF is based on the weighted average cost of capital of the Company plus a risk premium representing the risk associated with producing a particular program. The Company performs an annual impairment analysis for unamortized programming costs. An impairment charge is recorded in the amount by which the unamortized costs exceed the estimated fair value. Estimates of future revenue involve measurement uncertainties and it is therefore possible that reductions in the carrying value of programming costs may be required as a consequence of changes in management’s future revenue estimates. Included in cost of revenue in the consolidated statements of income and comprehensive income for 2017 and 2016, is amortization of programming costs totaling $ 2,973,399 3,155,668 |
Film Costs, Policy [Policy Text Block] | Film Library The film library represents the cost of acquiring film distribution rights and related acquisition and accrued participation costs. The film library is amortized using the individual-film-forecast-computation method. Film library is stated at the lower of unamortized cost or fair value. Amortization is based upon management’s best estimate of total future, or ultimate revenue. Amortization is adjusted when necessary to reflect increases or decreases in forecasted ultimate revenues. Ultimate revenue time frame is determined based on the term of the acquisition agreement, which in most cases is ten years or more. The company generally acquires distribution rights covering periods of ten or more years. Included in cost of revenue in the consolidated statements of income and comprehensive income for the years ended December 31, 2017 and 2016 is amortization of film library totaling $ 1,378,869 0 |
Popcornflix Film Rights and Other Assets,Policy [Policy Text Block] | Popcornflix Film Rights and Other Assets Popcornflix film rights and other assets represents the direct-to-consumer online video service and application platform comprised of five ad-supported networks with rights to over 3,000 films and approximately 60 television series. Popcornflix is an indefinite-lived intangible and is not subject to amortization but annual impairment analysis. For the year ended December 31, 2017, there was no material impairment charge recorded. |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company was formed on May 4, 2016 as a Sub-Chapter C corporation for federal and state tax purposes. As such, the Company filed its first tax return for the year ended December 31, 2016. Prior to May 4, 2016, CSS Productions had elected to be treated as a partnership for federal and state income tax purposes and, accordingly, no provision was made for income taxes prior to that date. CSS Productions has not been audited by the taxing authorities. If taxable income is adjusted as a result of an audit for periods prior to May 4, 2016, then CSS Productions may be required to make distributions to satisfy its members’ tax obligations. Any such distributions would not be made from, or be the responsibility of, the Company. The Company records income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred taxes are also recognized for operating losses that are available to offset future taxable income. A valuation allowance is established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be realized or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company accounts for uncertain tax positions in accordance with the authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 740: Income Taxes The Company includes interest and penalties related to its uncertain tax positions as part of income tax expense within its consolidated statements of income and comprehensive income. At December 31, 2017 and 2016, the Company did not have any unrecognized tax benefits or liabilities. See Note 13 for additional information. |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | Long-Lived Assets The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If the sum of the expected future cash flows, undiscounted and without interest, is less than the carrying amount of the asset, an impairment loss is recognized as the amount by which the carrying amount of the asset exceeds its fair value. |
Film Library Acquisition Obligations,Policy [Policy Text Block] | Film Library Acquisition Obligations Film library acquisition obligations represent amounts due in connection with the Company acquiring film distribution rights. Pursuant to the film distribution rights agreements, the Company’s right to distribute films may revert to the licensor in the event that the Company is unable to satisfy its financial obligations with respect to the acquisition of the related distribution rights. |
Participation Costs, Policy [Policy Text Block] | The Company accrues for participation costs due to production companies and producers based on the respective agreements. Amounts due to production companies and producers are calculated based on gross revenue for each film after exceeding certain minimum targets. In addition, the Company must recoup its original investment in each film before such payments are due. Accrued participation costs are capitalized and amortized as part of the film library. |
Revenue Recognition, Policy [Policy Text Block] | Revenue from online digital distribution and VOD platforms are recorded when monthly activity is reported by advertisers. For theatrical releases, revenue is recorded after the theatrical release date and when box office proceeds reports are received. Revenue generated under the distribution agreement with A Sharp, Inc., d/b/a A Plus (“A Plus”) is reported on a net basis as the Company earns a commission on the distribution of A Plus’ content (see Note 14). Revenue from all digital media distribution is included in online networks in the accompanying consolidated statements of income and comprehensive income. The Company licenses and distributes multi-film packages to its customers. Revenue from multi-film sales is allocated on a per title basis and recognized upon initial availability for exploitation by customers. In addition, the Company distributes DVDs and similar media to its customers. The Company recognizes revenue upon shipment of DVD units or similar media units to its customers. Provision for future returns and other allowances are established based upon historical experience. Revenue from the distribution of multi-film packages and DVDs and similar media is included in television and film distribution in the accompanying consolidated statements of income and comprehensive income. The Company recognizes revenue from the production and distribution of television programs and short-form video content in accordance with Accounting Standards Codification Topic 926: Entertainment Films Cash advances received by the Company are recorded as deferred revenue until all the conditions of revenue recognition have been met. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Share-Based Payments The Company accounts for share-based payments in accordance with ASC 718: Share-based compensation, which establishes the accounting for transactions in which an entity exchanges its equity instruments for goods or services. Under the provisions of the authoritative guidance, share-based compensation expense is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period, net of estimated forfeitures. Shares issued for services are based upon current selling prices of the Company’s Class A common stock or independent third party valuations. The Company estimates the fair value of share-based instruments using the Black-Scholes option-pricing model. All share-based awards are fulfilled with new shares of Class A common stock. For the years ended December 31, 2017 and 2016, share-based awards were issued to non-employee directors and individuals for services rendered and were recorded at fair value. |
Advertising Costs, Policy [Policy Text Block] | Generally, advertising costs are expensed as incurred except for the advertising costs associated with the Company’s theatrically released titles which the Company is obligated to make reimbursements for. The expense recorded in the consolidated statements of income and comprehensive income for the year ended December 31, 2017 was $ 63,875 2,000 |
Earnings Per Share, Policy [Policy Text Block] | Earnings Per Share Basic net income per common share is computed based on the weighted average number of shares of all classes of common stock outstanding. Diluted net income per common share is computed based on the weighted average number of common shares outstanding increased, when applicable, by dilutive common stock equivalents, comprised of Class W warrants, Class Z warrants and stock options outstanding. For 2016, basic and diluted net income per common share assumes that Class B common stock of the Company issued pursuant to the Contribution Agreement and the resulting recapitalization of the Company is issued and outstanding as of January 1, 2016. In computing the effect of dilutive common stock equivalents, the Company uses the treasury stock method to calculate the related incremental shares. In applying the treasury stock method, prior to its IPO the Company used a share price of $ 12 |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentration of Credit Risk The Company maintains cash balances at its bank. Accounts for each entity are insured by the Federal Deposit Insurance Corporation subject to certain limitations. At various times during the fiscal year, the Company’s cash in bank balances exceeded the federally insured limits. The uninsured balances at December 31, 2017 and December 31, 2016 were $ 1,422,001 5,600 Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash in bank, revenue and accounts receivable. For the year ended December 31, 2017, we had 4 customers, which accounted for 77 52 73 58 94 46 |
Reclassification, Policy [Policy Text Block] | Reclassification Certain prior year balances have been reclassified to conform to the current year presentation. In the consolidated statements of income and comprehensive income, prior year revenue has been presented in a manner more representative of the Company’s current revenue streams. These reclassifications have no effect on previously reported net income. |
Business Combination (Tables)
Business Combination (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | The acquisition is accounted for as a purchase of a business under ASC 805, and the aggregate purchase price consideration of $ 5.3 Purchase Price Consideration Allocation: Cash consideration $ 4,905,355 Equity consideration - Class A common stock 281,050 Equity consideration - Class Z warrants 143,500 Purchase price consideration 5,329,905 Less: cash acquired (221,541) Total purchase consideration, less cash acquired $ 5,108,364 Purchase price consideration allocated to fair value of net assets acquired: Accounts receivable, net $ 2,405,654 Prepaid expenses 175,719 Video inventory 343,308 Property and equipment, net 123,115 Other intangible asset 125,000 Popcornflix film rights and other assets 7,163,943 Film library, net 22,940,151 Assets acquired 33,276,890 Accounts payable and accrued expenses (774,350) Customer deposits (210,846) Accrued participations payable (2,137,983) Film obligations (723,600) Liabilities assumed (3,846,779) Gain on bargain purchase (24,321,747) Total purchase consideration, less cash acquired $ 5,108,364 |
Business Acquisition, Pro Forma Information [Table Text Block] | Year Ended December 31, (Unaudited) 2017 2016 Net revenue $ 18,836,046 $ 21,656,282 Cost of revenue 8,925,863 8,828,745 Gross profit 9,910,183 12,827,537 Operating expenses 12,312,030 13,147,035 Net loss (3,269,071) (963,554) Net loss per common share: Basic net loss per common share (0.32) (0.11) Diluted net loss per common share (0.32) (0.11) |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation, Stock Options, Activity [Table Text Block] | Stock options activity as of December 31, 2017 is as follows: As of December 31, 2017 Number of Stock Options Weighted Average Exercise Price Weighted Average Remaining Aggregate Intrinsic Value Total outstanding at the beginning of the period - $ - - $ - Options granted 690,000 7.61 1.91 1,079,500 Options exercised - - - - Actual options forfeited - - - - Options expired - - - - Total outstanding at December 31, 2017 690,000 $ 7.61 1.91 $ 1,079,500 Total exercisable at December 31, 2017 199,585 6.73 1.29 452,462 Total unvested at December 31, 2017 490,415 7.96 2.17 627,038 Total vested or expected to vest - December 31, 2017 690,000 7.61 1.91 1,079,500 |
Schedule of Nonvested Share Activity [Table Text Block] | The following table summarized unvested stock options as of December 31, 2017: Number of Stock Options Weighted Average Exercise Price Total unvested - December 31, 2016 - $ - Granted 690,000 3.33 Vested (199,585) 2.66 Cancellations - - Total unvested - December 31, 2017 490,415 3.60 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | Weighted Average Valuation assumptions: Expected dividend yield 0 % Expected equity volatility 57 % Expected term (years) 2.57 Risk-free interest rate 2.05 % Exercise price per stock option $ 7.61 Market price per share $ 6.92 Weighted average fair value per stock option $ 3.33 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Shares [Table Text Block] | A reconciliation of shares used in calculating basic and diluted per share data is as follows: Year Ended December 31, 2017 2016 Basic weighted-average shares outstanding 10,063,732 8,835,930 Effect of dilutive securities: Assumed issuance of shares from exercise of stock options 50,274 - Assumed issuance of shares from exercise of warrants 118,156 160,706 Diluted weighted-average shares outstanding 10,232,162 8,996,636 |
Programming Costs (Tables)
Programming Costs (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Research and Development [Abstract] | |
Programming Costs Net [Table Text Block] | Programming costs, net of amortization, consists of the following: December 31, 2017 2016 Released, net of accumulated amortization of $6,725,362 and $3,801,963, respectively $ 6,218,499 $ 3,228,440 In production 12,784 100,000 In development 1,419,862 649,113 $ 7,651,145 $ 3,977,553 |
Film Library (Tables)
Film Library (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Film Library [Abstract] | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Acquisition costs $ 24,034,514 Accumulated amortization (1,378,869) Net film library costs $ 22,655,645 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | The Company’s current and deferred income tax (benefit) provision are as follows: Year Ended December 31, 2017 2016 Current provision (benefit): Federal $ - $ - States - - Total current provision - - Deferred (benefit) provision: Federal (142,000) 355,000 States (40,000) 84,000 Total deferred (benefit) provision (182,000) 439,000 Total (benefit) provision for income taxes $ (182,000) $ 439,000 |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | The significant reason for these differences is as follows: Year Ended December 31, 2017 2016 Expected tax provision Income taxes computed at Federal statutory rate (35% for 2017; 34% for 2016) $ 7,912,000 $ 414,000 Increase (decrease) in tax expense resulting from: - Gain on bargain purchase (8,512,000) - Amortization of debt discount 303,000 - State and local taxes (12,000) 85,000 Tax on pre-incorporation income of predecessor - (177,000) Programming costs (178,000) - Acquisition-related costs 204,000 - Film library 130,000 - Other (29,000) 117,000 Actual tax (benefit) provision $ (182,000) $ 439,000 |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | The components of deferred tax assets and liabilities are as follows: December 31, 2017 (1) 2016 Deferred tax assets: Net operating loss carry-forwards $ 318,000 $ 481,000 Acquisition-related costs 584,000 - Film library 371,000 - Other liabilities - 36,000 Total deferred tax assets 1,273,000 517,000 Deferred tax liabilities: Programming costs 1,389,000 886,000 Other assets 141,000 70,000 Total deferred tax liabilities 1,530,000 956,000 Net deferred tax liability $ 257,000 $ 439,000 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | The Company leases its office facilities under the terms of a non-cancelable operating lease agreement that expires on February 28, 2020. Minimum annual rental commitments under the lease are as follows: Year Ended December 31, Amount 2018 $ 408,025 2019 417,206 2020 71,043 $ 896,274 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Major Customers by Reporting Segments [Table Text Block] | Gross revenue by geographic location, based on the location of the customers for the years ended December 31, 2017 and 2016, is as follows: Year Ended December 31, 2017 2016 United States $ 10,853,428 $ 8,118,632 Canada 8,118 - Europe 31,037 - Other foreign 86,756 - $ 10,979,340 $ 8,118,632 |
The Company, Description of B35
The Company, Description of Business, Initial Public Offering and Acquisition (Details Textual) | Nov. 03, 2017USD ($)$ / sharesshares | Aug. 17, 2017USD ($)$ / sharesshares | Jun. 30, 2017$ / sharesshares | May 31, 2016shares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($) | Jun. 30, 2016$ / shares |
Stock Issued During Period, Value, New Issues | $ | $ 23,802,078 | $ 877,251 | |||||
Stock Issued During Period, Shares, New Issues | shares | 2,241,983 | ||||||
Repayments of Notes Payable | $ | $ 4,100,000 | 4,082,000 | 0 | ||||
Repayments of Lines of Credit | $ | 4,500,000 | $ 6,805,000 | $ 1,050,000 | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 50,000 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 12 | ||||||
Number of Countries in which Entity Operates | 56 | ||||||
Common Class A [Member] | |||||||
Stock Issued During Period, Value, New Issues | $ | $ 30,000,000 | ||||||
Stock Issued During Period, Shares, New Issues | shares | 2,500,000 | 50,000 | |||||
Shares Issued, Price Per Share | $ / shares | $ 12 | $ 12 | |||||
Gross Proceeds From Issuance Of Common Stock | $ | $ 26,900,000 | ||||||
Proceeds from Issuance of Common Stock | $ | $ 24,000,000 | $ 487,500 | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 50,000 | ||||||
Common Class A [Member] | screen Media Ventures, LLC [Member] | |||||||
Payments to Acquire Businesses, Gross | $ | $ 4,900,000 | ||||||
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | $ | $ 35,000 | ||||||
Common Class B [Member] | |||||||
Shares Issued, Price Per Share | $ / shares | $ 16 | ||||||
Common Class B [Member] | Chicken Soup for the Soul, LLC [Member] | |||||||
Stock Issued During Period, Shares, Purchase of Assets | shares | 8,600,568 | ||||||
Common Class B [Member] | Trema, LLC [Member] | |||||||
Stock Issued During Period, Shares, Purchase of Assets | shares | 159,432 | ||||||
Selling Stockholder Shares [Member] | |||||||
Stock Issued During Period, Shares, New Issues | shares | 258,017 | ||||||
Class Z Warrant [Member] | screen Media Ventures, LLC [Member] | |||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 50,000 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 12 |
Summary of Significant Accoun36
Summary of Significant Accounting Policies (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Aug. 17, 2017 | |
Cost of Revenue | $ 4,735,734 | $ 3,155,668 | |
Cash, Uninsured Amount | 1,422,001 | 5,600 | |
Provision for Doubtful Accounts | 112,568 | 0 | |
Amortization of Intangible Assets | 1,378,869 | $ 0 | |
Theatrically Released Titles [Member] | |||
Advertising Expense | 63,875 | ||
DVD Releases [Member] | |||
Advertising Expense | $ 2,000 | ||
Customer Concentration Risk [Member] | |||
Concentration Risk, Percentage | 46.00% | 94.00% | |
Sales Revenue, Net [Member] | |||
Concentration Risk, Percentage | 10.00% | ||
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk, Percentage | 77.00% | ||
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | Major Customer [Member] | |||
Concentration Risk, Percentage | 52.00% | ||
Accounts Receivable [Member] | |||
Cost of Revenue | $ 2,973,399 | $ 3,155,668 | |
Concentration Risk, Percentage | 10.00% | ||
Allowance for Doubtful Accounts Receivable | $ 597,665 | ||
Provision for Doubtful Accounts | $ 112,568 | ||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk, Percentage | 73.00% | ||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Major Customer [Member] | |||
Concentration Risk, Percentage | 58.00% | ||
Common Class A [Member] | |||
Shares Issued, Price Per Share | $ 12 | $ 12 |
Business Combination (Details)
Business Combination (Details) - USD ($) | Nov. 03, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Total purchase consideration, less cash acquired | $ 4,683,814 | $ 0 | |
Gain on bargain purchase | (24,321,747) | $ 0 | |
Screen Media [Member] | |||
Cash consideration | 4,905,355 | ||
Purchase price consideration | $ 5,300,000 | 5,329,905 | |
Less: cash acquired | (221,541) | ||
Total purchase consideration, less cash acquired | 5,108,364 | ||
Accounts receivable, net | 2,405,654 | ||
Prepaid expenses | 175,719 | ||
Video inventory | 343,308 | ||
Property and equipment, net | 123,115 | ||
Other intangible asset | 125,000 | ||
Popcornflix film rights and other assets | 7,163,943 | ||
Film library, net | 22,940,151 | ||
Assets acquired | 33,276,890 | ||
Accounts payable and accrued expenses | (774,350) | ||
Customer deposits | (210,846) | ||
Accrued participations payable | (2,137,983) | ||
Film obligations | (723,600) | ||
Liabilities assumed | (3,846,779) | ||
Gain on bargain purchase | (24,321,747) | ||
Total purchase consideration, less cash acquired | 5,108,364 | ||
Screen Media [Member] | Class Z warrants [Member] | |||
Equity consideration | 143,500 | ||
Common Class A [Member] | Screen Media [Member] | |||
Cash consideration | $ 4,900,000 | ||
Equity consideration | $ 281,050 |
Business Combination (Details 1
Business Combination (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Net revenue | $ 18,836,046 | $ 21,656,282 |
Cost of revenue | 8,925,863 | 8,828,745 |
Gross profit | 9,910,183 | 12,827,537 |
Operating expenses | 12,312,030 | 13,147,035 |
Net loss | $ (3,269,071) | $ (963,554) |
Basic net loss per common share | $ (0.32) | $ (0.11) |
Diluted net loss per common share | $ (0.32) | $ (0.11) |
Business Combination (Details T
Business Combination (Details Textual) - USD ($) | Nov. 03, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2017 |
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 50,000 | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 12 | |||
Business Combination, Bargain Purchase, Gain Recognized, Amount | $ 24,321,747 | $ 0 | ||
Business Combination, Acquisition Related Costs | 2,193,147 | $ 0 | ||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 3,000,000 | |||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | 600,000 | |||
Business Combination, Integration Related Costs | 2,100,000 | |||
Class Z warrants [Member] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 30,618 | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 12 | |||
Screen Media [Member] | ||||
Payments to Acquire Businesses, Gross | 4,905,355 | |||
Business Combination, Consideration Transferred | $ 5,300,000 | 5,329,905 | ||
Business Combination, Bargain Purchase, Gain Recognized, Amount | 24,321,747 | |||
Business Combination, Acquisition Related Costs | $ 2,200,000 | |||
Screen Media [Member] | Class Z warrants [Member] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 50,000 | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 12 | |||
Common Class A [Member] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 50,000 | |||
Common Class A [Member] | Screen Media [Member] | ||||
Payments to Acquire Businesses, Gross | $ 4,900,000 | |||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 35,000 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of Stock Options, Total outstanding at the beginning of the period | 0 | |||
Number of Stock Options, Options granted | 690,000 | |||
Number of Stock Options, Options exercised | 0 | |||
Number of Stock Options, Actual options forfeited | 0 | |||
Number of Stock Options, Options expired | 0 | |||
Number of Stock Options, Total outstanding at the end of the period | 690,000 | 0 | ||
Number of Stock Options, Total exercisable at December 31, 2017 | 199,585 | |||
Number of Stock Options, Total unvested at December 31, 2017 | 490,415 | 0 | ||
Number of Stock Options, Total vested or expected to vest - December 31, 2017 | 690,000 | |||
Weighted Average Exercise Price, Balance | $ 0 | |||
Weighted Average Grant Date Fair Value, Granted | 7.61 | |||
Weighted Average Exercise Price, Balance | 7.61 | $ 0 | ||
Weighted Average Exercise Price, Total exercisable at December 31, 2017 | $ 6.73 | |||
Weighted Average Exercise Price, Total unvested at December 31, 2017 | $ 0 | $ 0 | 7.61 | $ 0 |
Weighted Average Exercise Price, Total vested or expected to vest - December 31, 2017 | $ 7.61 | |||
Weighted Average Remaining Contract Term, Total outstanding at the beginning of the period | 1 year 10 months 28 days | 0 years | ||
Weighted Average Remaining Contract Term, Options granted | 1 year 10 months 28 days | |||
Weighted Average Remaining Contract Term, Total exercisable at December 31, 2017 | 1 year 3 months 14 days | |||
Weighted Average Remaining Contract Term, Total unvested at December 31, 2017 | 2 years 2 months 1 day | |||
Weighted Average Remaining Contract Term, Total vested or expected to vest - December 31, 2017 | 1 year 10 months 28 days | |||
Aggregate Intrinsic Value, Total outstanding Balance | $ 1,079,500 | $ 0 | ||
Aggregate Intrinsic Value, Options granted | 1,079,500 | |||
Aggregate Intrinsic Value, Total exercisable at December 31, 2017 | 452,462 | |||
Aggregate Intrinsic Value, Total unvested at December 31, 2017 | 627,038 | |||
Aggregate Intrinsic Value, Total vested or expected to vest - December 31, 2017 | $ 1,079,500 |
Share-Based Compensation (Det41
Share-Based Compensation (Details 1) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Number of Stock Options, Total unvested - December 31, 2016 | shares | 0 |
Number of Stock Options, Granted | shares | 690,000 |
Number of Stock Options, Vested | shares | (199,585) |
Number of Stock Options, Cancellations | shares | 0 |
Number of Stock Options, Total unvested - December 31, 2017 | shares | 490,415 |
Weighted Average Exercise Price, Balance | $ / shares | $ 0 |
Weighted Average Exercise Price, Granted | $ / shares | 3.33 |
Weighted Average Exercise Price, Vested | $ / shares | 2.66 |
Weighted Average Exercise Price, Cancellations | $ / shares | 0 |
Weighted Average Exercise Price, Balance | $ / shares | $ 7.61 |
Share-Based Compensation (Det42
Share-Based Compensation (Details 2) | 12 Months Ended |
Dec. 31, 2017$ / shares | |
Valuation assumptions: | |
Expected dividend yield | 0.00% |
Expected equity volatility | 57.00% |
Expected term (years) | 2 years 6 months 25 days |
Risk-free interest rate | 2.05% |
Exercise price per stock option | $ 7.61 |
Market price per share | 6.92 |
Weighted average fair value per stock option | $ 7.61 |
Share-Based Compensation (Det43
Share-Based Compensation (Details Textual) - USD ($) | 12 Months Ended | |||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Allocated Share-based Compensation Expense | $ 638,258 | $ 1,542,044 | ||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options | $ 1,723,650 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 199,585 | |||||
Stock Issued | $ 0 | 792,000 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 1,000,000 | |||||
Scenario, Forecast [Member] | Equity Option [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Allocated Share-based Compensation Expense | $ 328,112 | $ 494,518 | $ 901,018 | |||
Subsequent Event [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 1,250,000 | |||||
Straight-line [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Allocated Share-based Compensation Expense | $ 572,905 | |||||
Executive Officer [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock Issued | 625,500 | |||||
Management [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Allocated Share-based Compensation Expense | $ 638,258 | 1,542,044 | ||||
Former Officer [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ 1,436,294 |
Earnings Per Share (Details)
Earnings Per Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Basic weighted-average shares outstanding | 10,063,732 | 8,835,930 |
Effect of dilutive securities: | ||
Assumed issuance of shares from exercise of stock options | 50,274 | 0 |
Assumed issuance of shares from exercise of warrants | 118,156 | 160,706 |
Diluted weighted-average shares outstanding | 10,232,162 | 8,996,636 |
Programming Costs (Details)
Programming Costs (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Programming Costs [Line Items] | ||
Released, net of accumulated amortization of $6,725,362 and $3,801,963, respectively | $ 6,218,499 | $ 3,228,440 |
In production | 12,784 | 100,000 |
In development | 1,419,862 | 649,113 |
Capitalized Computer Software, Net | $ 7,651,145 | $ 3,977,553 |
Programming Costs (Details) (Pa
Programming Costs (Details) (Parenthetical) - USD ($) | Dec. 31, 2017 | Nov. 30, 2016 |
Programming Costs [Line Items] | ||
Capitalized Computer Software, Accumulated Amortization | $ 6,725,362 | $ 3,801,963 |
Film Library (Details)
Film Library (Details) | Dec. 31, 2017USD ($) |
Acquisition costs | $ 24,034,514 |
Accumulated amortization | (1,378,869) |
Net film library costs | $ 22,655,645 |
Intangible Asset - Video Cont48
Intangible Asset - Video Content License (Details Textual) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Intangible Assets, Net (Excluding Goodwill) | $ 5,000,000 | $ 5,000,000 |
Senior Secured Notes Payable 49
Senior Secured Notes Payable and Senior Secured Revolving Line of Credit (Details Textual) - USD ($) | Mar. 10, 2018 | May 12, 2016 | Dec. 27, 2017 | Aug. 23, 2017 | Aug. 17, 2017 | Jun. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 28, 2018 | Mar. 26, 2018 | May 31, 2017 |
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 50,000 | ||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 12 | ||||||||||
Warrants Not Settleable in Cash, Fair Value Disclosure | $ 424,025 | $ 1,079,360 | |||||||||
Amortization of Debt Discount (Premium) | 865,833 | $ 383,712 | |||||||||
Amortization of Debt Issuance Costs | $ 48,247 | 40,859 | |||||||||
Warrants Expiration Date | May 12, 2021 | ||||||||||
Repayments of Lines of Credit | $ 4,500,000 | $ 6,805,000 | 1,050,000 | ||||||||
Proceeds from Lines of Credit | 4,825,000 | 4,530,000 | |||||||||
Long-term Line of Credit | 1,500,000 | 3,316,488 | |||||||||
Subsequent Event [Member] | |||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.75% | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 7,500,000 | ||||||||||
Proceeds from Lines of Credit | 5,000,000 | ||||||||||
Revolving Credit Facility [Member] | |||||||||||
Amortization of Debt Discount (Premium) | 237,860 | 149,511 | |||||||||
Amortization of Debt Issuance Costs | 2,845 | 3,555 | |||||||||
Debt Instrument, Periodic Payment, Interest | 139,504 | 81,703 | |||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 4,500,000 | 4,500,000 | |||||||||
Line of Credit Facility, Interest Rate During Period | 5.00% | ||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.75% | ||||||||||
Repayments of Lines of Credit | $ 4,500,000 | ||||||||||
Proceeds from Lines of Credit | $ 460,000 | ||||||||||
Revolving Credit Facility [Member] | Subsequent Event [Member] | |||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,500,000 | ||||||||||
Long-term Line of Credit | $ 37,304 | $ 1,700,000 | |||||||||
Revolving Credit Facility [Member] | Minimum [Member] | |||||||||||
Debt Conversion, Original Debt, Amount | $ 52,560,000 | ||||||||||
Class W warrants [Member] | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 157,500 | 460,000 | |||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 7.50 | $ 7.50 | |||||||||
Class Z warrants [Member] | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 30,618 | ||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 12 | ||||||||||
Senior Notes [Member] | |||||||||||
Debt Instrument, Face Amount | $ 5,000,000 | ||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ||||||||||
Debt Conversion, Original Debt, Amount | $ 918,000 | ||||||||||
Debt Conversion, Converted Instrument, Shares Issued | 102,060 | ||||||||||
Debt Instrument, Convertible, Conversion Price | $ 9 | ||||||||||
Amortization of Debt Discount (Premium) | 627,973 | 234,201 | |||||||||
Amortization of Debt Issuance Costs | 40,902 | 37,304 | |||||||||
Debt Instrument, Periodic Payment, Interest | $ 136,526 | $ 50,727 |
Stockholders' Equity (Details T
Stockholders' Equity (Details Textual) - USD ($) | 1 Months Ended | 6 Months Ended | 7 Months Ended | 12 Months Ended | |||||
Aug. 17, 2017 | Jun. 30, 2017 | May 31, 2016 | Nov. 30, 2016 | May 31, 2017 | Dec. 31, 2017 | May 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |||||||
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 | |||||||
Stock Issued | $ 0 | $ 792,000 | |||||||
Proceeds from Issuance of Private Placement | $ 1,413,400 | 1,075,809 | |||||||
Stock Issued During Period, Shares, New Issues | 2,241,983 | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 50,000 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 12 | ||||||||
Shareholders' Equity and Warrants, Fair Value Disclosure | $ 625,500 | ||||||||
Two Thousand Sixteen Equity Private Placement [Member] | |||||||||
Sale of Stock, Number of Shares Issued in Transaction | 17,096 | ||||||||
Proceeds from Issuance of Private Placement | $ 1,025,760 | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 51,288 | ||||||||
Sale of Stock, Description of Transaction | The purchase price of each unit was $60 and each unit consisted of 10 shares of Class A common stock and 3 Warrants exercisable at $7.50 each. | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 7.50 | $ 7.50 | |||||||
Class of Warrant or Right, Expiration Date | Jun. 30, 2021 | ||||||||
Sale of Stock, Price Per Share | $ 60 | $ 60 | |||||||
Two Thousand Seventeen Equity Private Placement [Member] | |||||||||
Sale of Stock, Number of Shares Issued in Transaction | 15,011 | ||||||||
Proceeds from Issuance of Private Placement | $ 975,710 | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 45,034 | 45,034 | |||||||
Sale of Stock, Description of Transaction | each unit consisted of 10 shares of Class A common stock and 3 Warrants exercisable at $7.50 each. | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 7.50 | $ 7.50 | |||||||
Class of Warrant or Right, Expiration Date | Jun. 30, 2021 | ||||||||
Sale of Stock, Price Per Share | $ 65 | $ 65 | |||||||
Trema, LLC [Member] | |||||||||
Stock Issued | $ 792,000 | ||||||||
Common Class A [Member] | |||||||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |||||||
Common Stock, Shares Authorized | 70,000,000 | 70,000,000 | |||||||
Common Stock, Shares, Outstanding | 3,746,054 | 893,369 | |||||||
Shares Issued, Price Per Share | $ 12 | $ 12 | |||||||
Stock Issued During Period, Shares, New Issues | 2,500,000 | 50,000 | |||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 50,000 | ||||||||
Proceeds from Issuance of Common Stock | $ 24,000,000 | $ 487,500 | |||||||
Common Class A [Member] | Two Thousand Sixteen Equity Private Placement [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 170,960 | ||||||||
Common Class A [Member] | Two Thousand Seventeen Equity Private Placement [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 150,112 | ||||||||
Common Class A [Member] | Other Party [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 55,000 | ||||||||
Common Class B [Member] | |||||||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |||||||
Common Stock, Shares Authorized | 20,000,000 | 20,000,000 | |||||||
Common Stock, Shares, Outstanding | 7,863,938 | 8,071,955 | |||||||
Shares Issued, Price Per Share | $ 16 | ||||||||
Common Class B [Member] | Chicken Soup for the Soul, LLC [Member] | |||||||||
Stock Issued During Period, Shares, Purchase of Assets | 8,600,568 | ||||||||
Common Class B [Member] | Trema, LLC [Member] | |||||||||
Stock Issued During Period, Shares, Purchase of Assets | 159,432 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Current provision (benefit): | ||
Federal | $ 0 | $ 0 |
States | 0 | 0 |
Total current provision | 0 | 0 |
Deferred (benefit) provision: | ||
Federal | (142,000) | 355,000 |
States | (40,000) | 84,000 |
Total deferred (benefit) provision | (182,000) | 439,000 |
Total (benefit) provision for income taxes | $ (182,000) | $ 439,000 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Expected tax provision Income taxes computed at Federal statutory rate (35% for 2017; 34% for 2016) | $ 7,912,000 | $ 414,000 |
Increase (decrease) in tax expense resulting from: | ||
Gain on bargain purchase | (8,512,000) | 0 |
Amortization of debt discount | 303,000 | 0 |
State and local taxes | (12,000) | 85,000 |
Tax on pre-incorporation income of predecessor | 0 | (177,000) |
Programming costs | (178,000) | 0 |
Acquisition-related costs | 204,000 | 0 |
Film library | 130,000 | 0 |
Other | (29,000) | 117,000 |
Actual tax (benefit) provision | $ (182,000) | $ 439,000 |
Income Taxes (Details 1) (Paren
Income Taxes (Details 1) (Parenthetical) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% | 34.00% |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) | Dec. 31, 2017 | [1] | Dec. 31, 2016 |
Deferred tax assets: | |||
Net operating loss carry-forwards | $ 318,000 | $ 481,000 | |
Acquisition-related costs | 584,000 | 0 | |
Film library | 371,000 | 0 | |
Other liabilities | 0 | 36,000 | |
Total deferred tax assets | 1,273,000 | 517,000 | |
Deferred tax liabilities: | |||
Programming costs | 1,389,000 | 886,000 | |
Other assets | 141,000 | 70,000 | |
Total deferred tax liabilities | 1,530,000 | 956,000 | |
Net deferred tax liability | $ 257,000 | $ 439,000 | |
[1] | The Company adjusted its federal deferred income tax assets and liabilities as of December 31, 2017 to reflect the reduction in the U.S. statutory federal corporate income tax rate from 35% to 21% resulting from the provisions of the 2017 Tax Cut and Jobs Act. |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Amortization, Percent | 35.00% | |
Operating Loss Carryforwards | $ 1,515,000 | |
Operating Loss Carryforwards, Limitations on Use | Internal Revenue Code Section 382 imposes limitations on the use of net operating loss carryovers when the stock ownership of one or more 5% stockholders (stockholders owning 5% or more of the Companys outstanding capital stock) has increased by more than 50 percentage points. | |
Scenario, Plan [Member] | ||
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Amortization, Percent | 21.00% | |
Expiring in 2036 [Member] | ||
Operating Loss Carryforwards | $ 1,389,000 | |
Expiring in 2017 [Member] | ||
Operating Loss Carryforwards | $ 126,000 |
Related Party Transactions (Det
Related Party Transactions (Details Textual) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||
Aug. 21, 2017 | May 31, 2016 | Mar. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 10, 2018 | Mar. 31, 2017 | Sep. 30, 2016 | Mar. 31, 2016 | |
Related Party Transaction [Line Items] | |||||||||
Management Fee Expense,Percenatge | 5.00% | ||||||||
Payments for Other Fees | $ 739,422 | ||||||||
License Costs | $ 1,065,700 | $ 811,863 | |||||||
Payments for Legal Settlements | $ 572,172 | ||||||||
Prepaid Distribution Costs | 1,892,806 | 592,786 | |||||||
Sales Revenue, Goods, Net | 10,657,001 | 8,118,632 | |||||||
Proceeds from Notes Payable | 2,030,000 | 2,970,000 | |||||||
Selling, General and Administrative Expense | 3,197,446 | 2,370,912 | |||||||
Proceeds from Issuance of Private Placement | 1,413,400 | 1,075,809 | |||||||
Payments to Acquire Right to Integrate Certain Products | 100,000 | ||||||||
Software Costs Payable | 375,761 | 1,061,980 | |||||||
Due from Affiliates | 6,128,629 | 1,372,517 | |||||||
Subsequent Event [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.75% | ||||||||
Repayments of Related Party Debt | $ 1,000,000 | ||||||||
Video Content [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Net Distribution Fee,Percentage | 30.00% | ||||||||
Editorial Content [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Net Distribution Fee,Percentage | 5.00% | ||||||||
Online [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Sales Revenue, Goods, Net | 796,664 | 398,143 | |||||||
A Sharp Inc [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Prepaid Distribution Costs | $ 3,000,000 | ||||||||
A Sharp Inc [Member] | Video Content [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Net Distribution Fee,Percentage | 40.00% | ||||||||
A Sharp Inc [Member] | Editorial Content [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Net Distribution Fee,Percentage | 15.00% | ||||||||
A Sharp Inc [Member] | Online [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Sales Revenue, Goods, Net | 339,977 | 398,143 | |||||||
One Last Thing [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Software Costs Payable | 100,000 | ||||||||
CSS License Note [Member] | Low Profile Films Inc [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Selling, General and Administrative Expense | 35,000 | ||||||||
Debt Private Placement [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Proceeds from Notes Payable | 2,030,000 | 1,340,000 | |||||||
Equity Private Placement [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Proceeds from Notes Payable | 200,040 | ||||||||
Proceeds from Issuance of Private Placement | 1,413,140 | ||||||||
Soul, LLC [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Management Fee Expense | 532,850 | 405,932 | |||||||
Sales Commission,Percentage | 20.00% | ||||||||
License Costs | $ 5,000,000 | 532,850 | 405,932 | ||||||
Payments for License Fees | $ 1,500,000 | ||||||||
Interest Paid | $ 3,069 | ||||||||
Incremental Recurring License Fee,Percentage | 4.00% | ||||||||
Marketing Support Fees,Percentage | 1.00% | ||||||||
Soul, LLC [Member] | CSS License Note [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Debt Instrument, Face Amount | $ 3,500,000 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 0.50% | ||||||||
Investor [Member] | A Sharp Inc [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 23.00% | ||||||||
Third Parties [Member] | A Sharp Inc [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 2.00% | ||||||||
Subsidiary of Soul LLC [Member] | A Sharp Inc [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Equity Method Investment, Ownership Percentage | 75.00% | ||||||||
Chicken Soup for the Soul, LLC [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Due from Affiliates | 6,128,629 | ||||||||
Payments for Advance to Affiliate | $ 4,700,000 |
Commitments and Contingencies57
Commitments and Contingencies (Details) | Dec. 31, 2017USD ($) |
2,018 | $ 408,025 |
2,019 | 417,206 |
2,020 | 71,043 |
Operating Leases, Future Minimum Payments Due | $ 896,274 |
Commitments and Contingencies58
Commitments and Contingencies (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Letters of Credit Outstanding, Amount | $ 129,986 | |
Operating Leases, Rent Expense | $ 67,951 | $ 0 |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues | $ 10,979,340 | $ 8,118,632 |
UNITED STATES | ||
Revenues | 10,853,428 | 8,118,632 |
CANADA | ||
Revenues | 8,118 | 0 |
Europe [Member] | ||
Revenues | 31,037 | 0 |
Other Foreign Countries [Member] | ||
Revenues | $ 86,756 | $ 0 |
Segment Reporting (Details Text
Segment Reporting (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Revenues | $ 10,979,340 | $ 8,118,632 |
Customer One [Member] | ||
Revenues | 3,000,000 | $ 3,700,000 |
Customer Two [Member] | ||
Revenues | 2,500,000 | |
Customer Three [Member] | ||
Revenues | $ 1,100,000 | |
Sales Revenue, Net [Member] | ||
Concentration Risk, Percentage | 10.00% | |
Sales Revenue, Net [Member] | Customer One [Member] | ||
Concentration Risk, Percentage | 28.00% | 46.00% |
Sales Revenue, Net [Member] | Customer Two [Member] | ||
Concentration Risk, Percentage | 24.00% | |
Sales Revenue, Net [Member] | Customer Three [Member] | ||
Concentration Risk, Percentage | 11.00% | |
Accounts Receivable [Member] | ||
Concentration Risk, Percentage | 10.00% | |
Accounts Receivable [Member] | Customer One [Member] | ||
Concentration Risk, Percentage | 58.00% | 100.00% |
Subsequent Events (Details Text
Subsequent Events (Details Textual) - USD ($) | Mar. 10, 2018 | Dec. 27, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 27, 2018 | Jan. 31, 2018 | May 12, 2016 |
Subsequent Event [Line Items] | |||||||
Proceeds from Lines of Credit | $ 4,825,000 | $ 4,530,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,000,000 | ||||||
Subsequent Event [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 7,500,000 | ||||||
Proceeds from Lines of Credit | $ 5,000,000 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.75% | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,250,000 | ||||||
Revolving Credit Facility [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 4,500,000 | $ 4,500,000 | |||||
Proceeds from Lines of Credit | $ 460,000 | ||||||
Revolving Credit Facility [Member] | Subsequent Event [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,500,000 | ||||||
Revolving Credit Facility [Member] | Subsequent Event [Member] | Prime Rate [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Debt Instrument, Description of Variable Rate Basis | prime rate plus 1.5% | ||||||
Common Class A [Member] | Subsequent Event [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Stock Repurchase Program, Authorized Amount | $ 5,000,000 |