Attached files
| file | filename |
|---|---|
| 8-K/A - 8-K/A - LOCAL Corp | d573767d8ka.htm |
| EX-99.2 - EX-99.2 - LOCAL Corp | d573767dex992.htm |
Exhibit 99.1
LOCAL CORPORATION
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On July 26, 2013, Local Corporation (the “Company”) completed the sale of substantially all of the assets of the Company’s Spreebird business including: the spreebird.com domain and website; all Spreebird subscribers; the Spreebird trademark; and all Spreebird deal of the day software, including an administration user interface, a reporting function, an email create application, and a customer service user interface; to nCrowd, Inc pursuant to an Asset Purchase Agreement dated July 22, 2013 (the “Asset Sale”). The minimum consideration for the assets sold is $209,950, subject to offsets for assumed liabilities.
The following unaudited pro forma condensed consolidated financial statements of the Company have been derived from the historical financial statement of the Company, as adjusted, to give effect to the Asset Sales. The historical financial information of the Company set forth below has been derived from the historical consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2012 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2013. The unaudited pro forma consolidated balance sheet as of March 31, 2013 includes pro forma adjustments giving effect to the Asset Sale as if it had occurred on that date. The unaudited pro forma consolidated statements of operations for the three months ended March 31, 2013, and for the year ended December 31, 2012 include pro forma adjustments giving effect to the Asset Sale as if it had occurred on January 1, 2013, and January 1, 2012, respectively.
The unaudited pro forma condensed consolidated financial information is presented to comply with the rules and regulations of the Securities and Exchange Commission governing the disclosure of pro forma information. The unaudited pro forma condensed consolidated financial information has been provided for informational purposes only and should not be considered indicative of the financial condition or results of operations that would have been achieved had the Asset Sale occurred as of the dates presented, nor the Company’s financial condition or results of operations that might be achieved as of any future date or any future period. Furthermore, the unaudited pro forma condensed consolidated financial information does not give effect to any restructuring costs, operational savings or financial conditions that may have impacted the retained business since March 31, 2013. The unaudited pro forma condensed consolidated financial information, including the notes thereto, should be read in conjunction with the historical financial statements of the Company included in its Annual Report on Form 10-K for the year ended December 31, 2012 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2013.
LOCAL CORPORATION
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except par value)
(Unaudited)
| As of March 31, 2013 | ||||||||||||||
| As Reported | Adjustments | Pro Forma | ||||||||||||
| ASSETS | ||||||||||||||
| Current assets: |
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| Cash |
$ | 3,067 | $ | - | $ | 3,067 | ||||||||
| Restricted cash |
42 | - | 42 | |||||||||||
| Accounts receivable, net of allowances of $64 and $250, respectively |
10,716 | 210 | (A) | 10,926 | ||||||||||
| Notes receivable - current portion |
269 | - | 269 | |||||||||||
| Prepaid expenses and other current assets |
1,007 | - | 1,007 | |||||||||||
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| Total current assets |
15,101 | 210 | 15,311 | |||||||||||
| Property and equipment, net |
6,462 | (342) | (B) | 6,120 | ||||||||||
| Goodwill |
21,850 | (2,569) | (B) | 19,281 | ||||||||||
| Intangible assets, net |
3,607 | (487) | (B) | 3,120 | ||||||||||
| Long-term receivable, net of allowances of $1,710 and $1,710, respectively |
1,579 | - | 1,579 | |||||||||||
| Escrow receivable |
390 | - | 390 | |||||||||||
| Deposits |
68 | - | 68 | |||||||||||
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| Total assets |
$ | 49,057 | $ | (3,187) | $ | 45,870 | ||||||||
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| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||
| Current liabilities: |
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| Accounts payable |
$ | 9,684 | $ | - | $ | 9,684 | ||||||||
| Accrued compensation |
1,332 | - | 1,332 | |||||||||||
| Deferred rent |
642 | - | 642 | |||||||||||
| Other accrued liabilities |
1,558 | - | 1,558 | |||||||||||
| Revolving line of credit |
9,042 | - | 9,042 | |||||||||||
| Deferred revenue |
243 | - | 243 | |||||||||||
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| Total current liabilities |
22,501 | - | 22,501 | |||||||||||
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| Deferred income taxes |
302 | - | 302 | |||||||||||
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| Total liabilities |
22,803 | - | 22,803 | |||||||||||
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| Commitments, contingencies and subsequent events |
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| Stockholders’ equity: |
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| Convertible preferred stock, $0.00001 par value; 10,000 shares authorized; none issued and outstanding for all periods presented |
- | - | - | |||||||||||
| Common stock, $0.00001 par value; 65,000 shares authorized; issued and outstanding 22,844 and 22,172, respectively |
- | - | - | |||||||||||
| Additional paid-in capital |
123,209 | - | 123,209 | |||||||||||
| Accumulated deficit |
(96,955) | (3,187) | (C) | (100,142) | ||||||||||
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| Stockholders’ equity |
26,254 | (3,187) | 23,067 | |||||||||||
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| Total liabilities and stockholders’ equity |
$ | 49,057 | $ | (3,187) | $ | 45,870 | ||||||||
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LOCAL CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per shares amounts)
(Unaudited)
| Three Months Ended March 31, 2013 | ||||||||||||||
| As Reported | Adjustments | (D) | Pro Forma | |||||||||||
| Revenue |
$ | 21,755 | $ | (291) | $ | 21,464 | ||||||||
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| Operating Expenses: |
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| Cost of revenues |
15,631 | (37) | 15,594 | |||||||||||
| Sales and marketing |
3,577 | (381) | 3,196 | |||||||||||
| General and administrative |
2,947 | - | 2,947 | |||||||||||
| Research and development |
1,719 | - | 1,719 | |||||||||||
| Amortization of intangibles |
325 | (94) | 231 | |||||||||||
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| Total operating expenses |
24,199 | (512) | 23,687 | |||||||||||
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| Operating income (loss) |
(2,444) | 221 | (2,223) | |||||||||||
| Interest and other income (expense), net |
(842) | - | (842) | |||||||||||
| Change in fair value of warrant liability |
5 | - | 5 | |||||||||||
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| Income (loss) from continuting operations before income taxes |
(3,281) | 221 | (3,060) | |||||||||||
| Provision for income taxes |
72 | - | 72 | |||||||||||
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| Net income (loss) |
$ | (3,353) | $ | 221 | $ | (3,132) | ||||||||
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| Per share data: |
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| Basic net income (loss) per share |
$ | (0.15) | $ | (0.14) | ||||||||||
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| Diluted net income (loss) per share |
$ | (0.15) | $ | (0.14) | ||||||||||
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| Basic weighted average shares outstanding |
22,564 | 22,564 | ||||||||||||
| Diluted weighted average shares outstanding |
22,564 | 22,564 | ||||||||||||
LOCAL CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per shares amounts)
(Unaudited)
| Year ended December 31, 2012 | ||||||||||||||
| As Reported | Adjustments | (D) | Pro-Forma | |||||||||||
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Revenue |
$ | 97,773 | $ | (1,799) | $ | 95,974 | ||||||||
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| Operating Expenses: |
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| Cost of revenues |
71,657 | (223) | 71,434 | |||||||||||
| Sales and marketing |
18,905 | (3,706) | 15,199 | |||||||||||
| General and administrative |
11,765 | - | 11,765 | |||||||||||
| Research and development |
5,082 | - | 5,082 | |||||||||||
| Amortization of intangibles |
4,102 | (491) | 3,611 | |||||||||||
| Impairment of goodwill and intangible assets |
10,551 | (10,551) | - | |||||||||||
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| Total operating expenses |
122,062 | (14,971) | 107,091 | |||||||||||
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| Operating income (loss) |
(24,289) | 13,173 | (11,116) | |||||||||||
| Interest and other income (expense), net |
(425) | - | (425) | |||||||||||
| Change in fair value of warrant liability |
202 | - | 202 | |||||||||||
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| Income (loss) from continuing operations before income taxes |
(24,512) | 13,173 | (11,339) | |||||||||||
| Provision for income taxes |
111 | - | 111 | |||||||||||
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| Net income (loss) from continuing operations |
(24,623) | 13,173 | (11,450) | |||||||||||
| Income (loss) from discontinued operations (net of taxes) |
381 | - | 381 | |||||||||||
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| Net income (loss) |
$ | (24,242) | $ | 13,173 | $ | (11,069) | ||||||||
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| Per share data: |
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| Basic net income (loss) per share from continuing operations |
$ | (1.11) | $ | (0.52) | ||||||||||
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| Basic net income (loss) per share from discontinued operations |
$ | 0.02 | $ | 0.02 | ||||||||||
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| Basic net income (loss) per share |
$ | (1.10) | $ | (0.50) | ||||||||||
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| Diluted net income (loss) per share from continuing operations |
$ | (1.11) | $ | (0.52) | ||||||||||
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| Diluted net income (loss) per share from discontinued operations |
$ | 0.02 | $ | 0.02 | ||||||||||
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| Diluted net income (loss) per share |
$ | (1.10) | $ | (0.50) | ||||||||||
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| Basic weighted average shares outstanding |
22,098 | 22,098 | ||||||||||||
| Diluted weighted average shares outstanding |
22,098 | 22,098 | ||||||||||||
LOCAL CORPORATION
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(A) – Reflects proceeds of $210,000 from the Asset Sale.
(B) – Reflects adjustments to eliminate assets sold and liabilities assumed in the Asset Sale.
(C) – Reflects adjustment for loss on the Asset Sale.
(D) – To eliminate the results of operations for the Spreebird business.