Exhibit 14.
UPROAR INC. REPORTS FISCAL YEAR RESULTS
Revenues Increase 224% Over Prior Year
Uproar Inc. (Nasdaq/EASDAQ: UPRO/UPROrs) today reported results for the
fourth quarter and fiscal year ended December 31, 2000. Revenues for the
quarter increased 145% to $12.5 million for the fourth quarter of 2000,
versus $5.1 million for the fourth quarter of 1999. Pro forma net loss,
excluding depreciation, amortization, acquisition-related integration
costs, inventory writedown, and amortization of deferred stock compensation
was $5.3 million or ($.13) per share versus $14.2 million or ($.60) per
share for the quarters ended December 31, 2000 and 1999 respectively.
Applying generally accepted accounting principles, the company reported a
net loss of ($20.9) million or ($.52) per basic and diluted share for the
quarter ended December 31, 2000, compared with a net loss of ($17.4)
million or ($.74) per share for the quarter ended December 31, 1999.
For the fiscal year ended December 31, 2000, Uproar reported revenues of
$33.7 million as compared to $10.4 million for the previous fiscal year, a
224% increase. Net loss was approximately ($55.3) million or ($1.81) per
share for the year as compared to a net loss of approximately ($38.7)
million or ($1.77) per share for the year ended December 31, 1999.
On February 5, 2001, the Company entered into a definitive merger agreement
with Flipside, Inc., a subsidiary of Vivendi Universal Publishing which is
itself a division of Vivendi Universal. Pursuant to the merger agreement,
Flipside commenced a cash tender offer on February 16, 2001 for all
outstanding common stock of Uproar at a price of $3 per share, or a total
consideration of approximately $140 million. The tender offer is expected
to close by March 16, 2001.
"We are proud of Uproar's financial performance in the year 2000,
especially in light of the difficult market environment that developed
during the course of the year," said Uproar Chairman and CEO Kenneth Cron.
"Maintaining our position as one of the top entertainment destinations on
the Internet was certainly a critical factor in Vivendi Universal's
decision to offer $3 per share, which reflects a substantial premium over
the price range in which our shares had been trading before we announced
the merger. The Board of Directors believes that the offer is in the best
interests of our stockholders and we encourage all stockholders to tender
their shares without delay."
FOURTH QUARTER HIGHLIGHTS
Revenues grew 48% to $12.5 million in the fourth quarter of 2000, from
$8.45 million in the third quarter of 2000.
Uproar delivered 2.5 billion ad impressions during the fourth quarter, an
increase of 43% over the third quarter.
In November, Uproar secured the exclusive worldwide online rights for the
popular television game show Name That Tune.
On December 14, Uproar acquired TrafficMarketplace.com, an online
advertising brokerage service based in Los Angeles, CA.
FOURTH QUARTER OPERATING HIGHLIGHTS
As of December 31, 2000, cash, cash equivalents and short-term investments
on Uproar's balance sheet were $82.9 million.
The Uproar Network was rated in the Media Metrix Top 20 for December 2000,
with almost 12 million unique visitors. Additionally, the Uproar Network
was ranked the 5th largest gainer among the top 50 web sites rated, with a
34% increase over November 2000.
FISCAL YEAR OPERATING HIGHLIGHTS
On March 22, 2000, Uproar completed a public offering of 2.5 million shares
of its common stock on the Nasdaq National Market, netting the company
approximately $79 million. Trading of Uproar's common stock on the Nasdaq
National Market commenced March 17, 2000.
On October 20, 2000, Uproar acquired iwin.com, a leading games-for-prizes
and Internet lottery site.
On July 19, 2000, Uproar extended and expanded its exclusive contract with
Pearson Television, a leading provider of syndicated television game shows,
through June 2005. The new contract adds almost four years to the existing
agreement, under which Uproar has an exclusive worldwide license to create
and provide online versions of Pearson television game shows, including
Family Feud, To Tell the Truth, 100% and Match Game.
ABOUT UPROAR INC.
Uproar Inc. is a leading interactive entertainment company. It operates a
family of advertising-supported interactive entertainment sites, which make
up the backbone of the Uproar Network, an extensive entertainment-based
Internet advertising platform. Uproar Inc. sites include: uproar.com, a
leading online entertainment destination offering games and game shows;
iwin.com, a leading games-for-prizes and Internet lottery site; and
amused.com, a site featuring humor and entertainment. With nearly 12
million unique users per month, the Uproar Network ranks among the Top-20
Web properties on the Internet. Headquartered in New York with offices in
Los Angeles, San Francisco, London, Tel Aviv and Budapest, Uproar Inc. is
publicly traded on the Nasdaq National Market system under the ticker
symbol UPRO and on the European Association of Securities Dealers'
Automated Quotation system (EASDAQ) under the ticker symbols UPRO and
UPROrs.
Uproar Inc. and Subsidiaries
Consolidated Balance Sheets
December 31,
-------------------------------
2000 1999
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ASSETS
Current assets:
Cash and cash equivalents $ 10,535,916 $ 15,135,742
Short term investments 72,330,107 --
Restricted cash 1,485,943 604,275
Accounts receivable - net of allowance
for doubtful accounts of $3,728,000
and $271,000, respectively 14,192,599 3,767,769
Prepaid advertising 3,347,005 3,861,996
Other current assets 2,669,531 744,612
------------- -------------
Total current assets 104,561,101 24,114,394
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Property and equipment, net 12,822,759 5,031,429
Goodwill and other intangible assets, net 94,367,745 10,649,387
Prepaid advertising, long term portion -- 2,847,005
Other long term assets 915,944 173,426
------------- -------------
Total assets $ 212,667,549 $ 42,815,641
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of capital lease
obligations $ 614,921 $ 102,777
Trade accounts payable 8,466,992 1,390,908
Accrued expenses and other current
liabilities 9,350,459 4,065,969
------------- -------------
Total current liabilities 18,432,372 5,559,654
------------- -------------
Long term portion of capital lease
obligations 937,012 51,681
Stockholders' equity:
Preferred stock, $.01 par value,
48,000,000 shares authorized, none
issued -- --
Common stock, $.01 par value,
112,000,000 shares authorized;
46,111,668 and 23,971,948 shares
issued and outstanding at
December 31, 2000 and 1999,
respectively 461,116 1,198,597
Additional paid-in capital 299,270,541 85,193,156
Accumulated deficit (104,444,450) (49,149,339)
Deferred compensation (1,824,826) --
Accumulated other comprehensive loss (164,216) (38,108)
------------- -------------
Total stockholders' equity 193,298,165 37,204,306
------------- -------------
Total liabilities and stockholders'
equity $ 212,667,549 $ 42,815,641
============= =============
Uproar Inc. and Subsidiaries
Consolidated Statements of Operations
Three Months Ended Twelve Months Ended
December 31, December 31,
----------------------------- -----------------------------
2000 1999 2000 1999
------------ ------------ ------------ ------------
(unaudited) (unaudited)
Revenues $ 12,507,316 $ 5,116,630 $ 33,727,640 $ 10,391,527
Cost of revenues (2,978,364) (870,392) (10,114,604) (2,533,294)
------------ ------------ ------------ ------------
Gross profit 9,528,952 4,246,238 23,613,036 7,858,233
------------ ------------ ------------ ------------
Sales and marketing 10,508,799 16,249,684 39,248,417 28,065,956
Product and technology development 2,668,957 1,153,055 8,972,430 3,701,393
General and administrative 5,197,887 2,875,603 16,586,568 8,919,011
Amortization of intangible assets 7,600,724 1,533,044 12,639,451 6,086,198
Integration costs 5,651,548 -- 5,651,548 --
------------ ------------ ------------ ------------
Total operating expenses 31,627,915 21,811,386 83,098,414 46,772,558
------------ ------------ ------------ ------------
Loss from operations (22,098,963) (17,565,148) (59,485,378) (38,914,325)
Other income (expenses):
Litigation settlement -- -- (350,000) --
Foreign exchange gain (loss) 8,251 16,995 (63,704) (119,996)
Interest income 1,310,008 99,690 4,778,001 535,166
Interest expense (35,654) (1,050) (99,109) (7,050)
Other income (expense) (1,569) (10,713) 2,314 (190,436)
------------ ------------ ------------ ------------
Loss before income taxes (20,817,927) (17,460,226) (55,217,876) (38,696,641)
Provision for income taxes 45,836 (22,043) 77,235 28,000
------------ ------------ ------------ ------------
Net loss $(20,863,763) $(17,438,183) $(55,295,111) $(38,724,641)
============ ============ ============ ============
Basic and diluted loss per common
share $ (0.52) $ (0.74) $ (1.81) $ (1.77)
Weighted average number of common
shares outstanding for basic
And diluted net loss per common
share 40,322,453 23,718,971 30,626,361 21,909,456
============ ============ ============ ============
SUPPLEMENTAL INFORMATION(a):
Pro forma net loss
excluding depreciation,
amortization, acquisition-related
integration costs, inventory
writedown, and amortization of
deferred stock compensation (5,268,419) (14,229,436) (29,178,927) (29,681,570)
============ ============ ============ ============
Pro forma basic and diluted net loss
per share excluding depreciation,
amortization, related-related
integration costs, inventory
writedown, and amortization of
deferred stock compensation $ (0.13) $(0.60)- $ (0.95) $ (1.35)
============ ============ ============ ============
(a) The above pro forma calculation uses methodologies and principles
different from generally accepted accounting principles.