What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2023-03-31 compared with 2022-04-01 · 512 added, 537 removed, 238 unchanged (82% of the section changed)

10 unchanged sentences

and similar expressions to identify forward-looking statements.

All dollar figures are presented in thousands unless otherwise stated.

an overview of the Company, see the information above presented under the section labeled “Item 1.

Business,” which is a

portion of this Annual Report’s “Part I.”

Business,” which is in

“Part I” of this Annual Report.

Operating Metrics

monitor and review the key operating metrics described below as we believe that these metrics are relevant for our industry and specifically

to us and to understanding our business.

Moreover, they form the basis for trends informing certain predictions related to our financial

Our key operating metrics focus primarily on our digital advertising revenue, which has experienced significant growth in

recent periods as indicated in the Results of Operations section below.

Management monitors and reviews these metrics because

such metrics are readily measurable in real time and can provide valuable insight into the performance of and trends related to our digital

advertising revenue and our overall business.

We consider only those key operating metrics described here to be material to our financial

condition, results of operations and future prospects.

key operating metrics are identified below:

per page view (“RPM”) – represents the advertising revenue earned per 1,000

It is calculated as our advertising revenue during a period divided by our total

page views during that period and multiplied by $1,000;

average pageviews – represents the total number of pageviews in a given month or the

average of each month’s pageviews in a fiscal quarter or year, which is calculated

as the total number of page views recorded in a quarter or year divided by three months or

12 months, respectively.

pricing indicators, we focus on RPM as it is the pricing metric most closely aligned with monthly average pageviews.

RPM is an indicator

of yield and pricing driven by both advertising density and demand from our advertisers.

average pageviews are measured across all properties hosted on the Platform and provide us with insight into volume, engagement and effective

page management and are therefore our primary measure of traffic.

We utilize a third-party source, Google Analytics, to confirm this

traffic data.

described above, these key operating metrics are critical for management as they provide insights into our digital advertising revenue

generation and overall business performance.

This information also provides feedback on the content on our website and its ability to

attract and engage users, which allows us to make strategic business decisions designed to drive more users to read or view more of our

content and generate higher advertising revenue across all properties hosted on the Platform.

the years ended December 31, 2022 and 2021 our RPM was $17.24 and $15.24, respectively.

For the years ended December 31, 2022 and 2021

our monthly average pageviews were 516,129,297 and 350,761,233, respectively.

of Current Global Economic Conditions

in the global economy presents significant risks to our business.

We are subject to continuing risks and uncertainties in connection

with the current macroeconomic environment, including inflation, rising interest rates and contraction in the availability of credit in the market place, geopolitical factors, including

the ongoing conflict between Russia and Ukraine and the responses thereto, and the remaining effects of the COVID-19 pandemic.

closely monitoring the impact of these factors on all aspects of our business, including the impacts on our users, customers, employees,

Publishers Partners, vendors and business partners.

particular, with the initial onset of COVID-19, we faced significant

change in our advertisers’ buying behavior.

Since May 2020, there has been a steady recovery in the advertising market in both pricing

and volume, which coupled with the return of professional and college sports yielded steady growth in revenues.

However, given that our

sports vertical business relies on sporting events to generate content and comprises a material portion of our revenues, our cash flows

and results of operations are susceptible to a widespread cancellation of sporting events or a general limitation of societal activity

akin to what occurred in the United States and elsewhere during 2020.

Future widespread shutdowns of in-person economic activity could

have a material impact on our business.

In addition, the COVID-19 pandemic has also caused supply chain inefficiencies, negatively impacting

our production and distribution costs in our print operations.

ultimate extent of the impact of global economic conditions on our business remains highly uncertain and will depend on future developments

and factors that continue to evolve.

Most of these developments and factors are outside of our control and could exist for an extended

period of time.

As a result, we are subject to continuing risks and uncertainties and continue to closely monitor the impact of the current

conditions on our business.

For more information regarding these risks and uncertainties, see the section titled “Risk Factors”

in Part 1, Item 1A of this Annual Report on Form 10-K.

and Capital Resources

and Working Capital Facility

of December 31, 2021, our principal sources of liquidity consisted of cash of approximately $9.3 million.

In addition, as of December

31, 2021, we had the use of additional proceeds from our working capital facility with FPP Finance LLC (“FastPay”) in the

amount of approximately $13.0 million, subject to eligible accounts receivable.

As of December 31, 2021, the outstanding balance

of the FastPay working capital facility was approximately $12.0 million.

We also had accounts receivable, net of our advances from FastPay

of approximately $9.7 million as of December 31, 2021.

Our cash balance as of the issuance date of our accompanying consolidated

financial statements is approximately $23.0 million.

accompanying consolidated financial statements have been presented on the basis that we are a going concern, which contemplates

the realization of assets and satisfaction of liabilities in the normal course of business.

We had revenues of approximately $189.1 million

during fiscal 2021 and have experienced recurring net losses from operations and negative operating cash flows.

Consequently, we were

dependent upon continued access to funding and capital resources from both new investors and related parties.

If continued funding and

capital resources are unavailable at reasonable terms, we may not be able to implement our growth plan and plan of operations.

financings may include terms that may be highly dilutive to existing stockholders.

of December 31, 2022, our principal sources of liquidity consisted of cash of $13,871.

In addition, as of December 31, 2022, we had $25,908

available for additional use, subject to eligible accounts receivable, under our working capital line of credit with SLR Digital Finance

LLC (formerly FPP Finance LLC) (“SLR”).

As December 31, 2022, the outstanding balance of the SLR working capital line of credit was

We also had accounts receivable, net of our advances from SLR of $19,858 as of December 31, 2022.

Our cash balance as of the

issuance date of our accompanying consolidated financial statements is $8,203.

accompanying consolidated financial statements have been presented on the basis that we are a going concern, which contemplates the realization

of assets and satisfaction of liabilities in the normal course of business.

We had revenues of $220,935 during fiscal 2022 and have experienced

recurring net losses from operations and negative operating cash flows.

Consequently, we were dependent upon continued access to funding

and capital resources from both new investors and related parties.

If continued funding and capital resources are unavailable at reasonable

terms, we may not be able to implement our growth plan and plan of operations.

These financings may include terms that may be highly

dilutive to existing stockholders.

continue to be focused on growing our existing operations and seeking accretive and complementary strategic acquisitions as part of our

9 unchanged sentences

statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

Historically,

we have recorded recurring losses from operations and have operated with a net capital deficiency.

We considered these factors to determine

if the significance of those conditions or events would limit our ability to meet our obligations when due.

Most recently, operating

losses realized in prior years had been impacted by the COVID-19 pandemic and the related shut down of most professional and collegiate

sports, which reduced user traffic and advertising revenue.

As we entered fiscal 2021, and the impact of COVID-19 on our operations began

to dissipate, we invested heavily in marketing, customer growth, and people and technology as we expanded our operations, specifically

related to TheStreet and the Sports Illustrated media business.

reflected in our accompanying consolidated financial statements, we recorded revenues of approximately $189.1 million and incurred a

net loss attributable to common stockholders of approximately $89.9 million for the year ended December 31, 2021.

We have historically financed our working capital requirements since inception through the issuance of debt

and equity securities.

has evaluated whether relevant conditions or events, considered in the aggregate, raise substantial doubt about our ability to continue

as a going concern.

The factors considered include, but are not limited to, our financial condition, liquidity sources, obligations

due within one year after the issuance date of our accompanying consolidated financial statements, and the funds necessary to maintain

operations, including negative financial trends or other indicators of possible financial difficulty.

Substantial doubt exists when

conditions and events, considered in the aggregate, indicate it is probable that a company will not be able to meet its obligations as

they become due within one year after the issuance date of its financial statements.

assessment is based on the relevant conditions that are known or reasonably knowable as of the date our accompanying consolidated

financial statements for the year ended December 31, 2021 were issued.

In particular, management evaluated our:

(1) 2022 cash flow

forecast, which considered the use of our working capital line with FastPay (as described below) to fund changes in working capital,

under which we have available credit of approximately $17.7 million, subject to eligible account receivables, as of the issuance

date of our accompanying consolidated financial statements for the year ended December 31, 2021, as well as the additional capital

we raised in a firm commitment underwritten public offering of $31.5 million after fees and expenses, which was completed subsequent

to December 31, 2021;

and (2) our 2022 operating budget, which considers that (i) more than half of our total revenue is derived

from recurring digital and print subscriptions, which are generally paid in advance , and (ii)

overall digital revenue, representing 53.4% of our total revenue, grew approximately 49.1% in fiscal 2021, which we believe demonstrates the

strength of our brands.

addition, our firm commitment underwritten public offering, as described above, demonstrates our ability to access capital markets.

Finally, management also considered our ability to implement additional measures, if required, related

to potential revenue and earnings declines from continued COVID-19-related challenges.

assessment of our ability to meet our future obligations is inherently judgmental, subjective and susceptible to change.

As a result of these considerations and as a part of the quantitative and qualitative factors that are known or reasonably knowable

as of the date our accompanying consolidated financial statements for the year ended December 31, 2021 were issued, we concluded

that conditions and events considered in the aggregate, do not raise substantial doubt about our ability to continue as a going concern

for a one-year period following the financial statement issuance date.

January 2022, we filed a registration statement on Form S-1 (File No.

333-262111), which the SEC declared effective on February 10, 2022.

In February 2022, we closed a firm commitment underwritten public offering of our common stock and received total net proceeds

of approximately $31.5 million, after deducting underwriting discounts and commissions and estimated offering expenses, which

includes the underwriter’s overallotment option that was partially exercised in March 2022.

recently, for the year ended December 31, 2022, we incurred a net loss from continuing operations of $67,388, had cash on hand

of $13,871 and a working capital deficit of $137,669.

Our net loss from continuing operations and working capital deficit have

been evaluated by management to determine if the significance of those conditions or events would limit our ability to meet our

obligations when due.

Furthermore, since our Bridge

Notes of $36,000, Senior Secured Notes of $62,691 and Delayed Draw Term Notes of $4,000, totaling $102,691 (collectively “our current debt”) are due by December 31, 2023 (see Note 19, Bridge Notes ,

and Note 20, Long-term Debt , in our accompanying consolidated financial statements), unless we are able to refinance or extend

our current debt beyond its current maturity, we may not be able to meet our obligations when due.

our evaluation, management determined there is substantial doubt about our ability to continue as a going concern for a one-year period

following the financial statement issuance date, unless we are able to refinance or extend the maturities of our current debt.

We plan to refinance or extend the maturities of our current debt to alleviate the conditions that raise substantial doubt about our ability

to continue as a going concern.

Financings and Obligations

proceeds from our debt financings (see Note 14, Line of Credit , and Note 19, Long-term Debt , in our accompanying consolidated

financial statements for additional information) consisted of the following:

proceeds from our debt financings (see Note 15, Line of Credit , Note 19, Bridge Notes and Note 20, Long-term Debt ,

in our accompanying consolidated financial statements for additional information) consisted of the following:

Credit Facility .

We are party to a financing and security agreement with FastPay, pursuant to which FastPay extended a $15.0 million

line of credit for working capital purposes secured by a first lien on all our cash and accounts receivable and a second lien on all

other assets.

The line of credit was increased to $25.0 million during fiscal 2021.

Borrowings under the facility bear interest at the

LIBOR Rate plus 6.00% and have a final maturity of February 28, 2024.

The aggregate principal amount outstanding, plus accrued and unpaid

interest, as of the issuance date of our accompanying consolidated financial statements for the year ended December 31, 2021 was approximately

$7.3 million.

Secured Note .

We are party to a second amended and restated note purchase agreement, as subsequently amended by Amendment

1, Amendment No.

2, Amendment No.

3, and Amendment No.

4 (collectively, the “Second A&R NPA”), with one accredited

investor, BRF Finance Co., LLC (“BRF Finance”), an affiliated entity of B.

We are party to a financing and security agreement with SLR, pursuant to which SLR extended a $25,000 line of credit

for working capital purposes secured by a first lien on all our cash and accounts receivable and a second lien on all other assets.

December 15, 2022, pursuant to an amendment, the line of credit was increased to $40,000.

Borrowings under the facility bear interest

at the prime rate plus 4% per annum of the amount advanced and have a maturity date of December 31, 2024;

provided that the maturity

date will be December 31, 2023 if we have not refinanced, repaid or extended all of our Senior Secured Notes (as defined below) due December

31, 2023 by August 31, 2023, and provided further, that SLR will be entitled to accelerate the obligations if we have not refinanced,

repaid or extended all of our Senior Secured Notes due December 31, 2023 by September 30, 2023.

In the event that our line of credit

is accelerated, we will be obligated to pay SLR a termination fee of $900.

The amendment also permitted us to enter into the Bridge Notes

(as defined below).

The aggregate principal amount outstanding, plus accrued and unpaid interest as of December 31, 2022 was $14,092.

On December 15, 2022, we issued $36,000 aggregate principal amount of senior secured notes (the “Bridge Notes”)

pursuant to a Third A&R NPA with BRF Finance Co., LLC (“BRF Finance”), an affiliated entity of B.

Riley Financial, Inc.

The senior secured note bears interest at a rate of 10% per annum.

Riley”), in its capacity as agent for the purchasers and as purchaser.

We received net proceeds of $34,728, after the

payment of $1,000 to B.

Riley for an advisory fee and $272 for other legal costs, from the issuance of the Bridge Notes.

the Bridge Notes is payable in cash at a rate of 12% per annum quarterly in arrears on March 31, 2023, June 30, 2023, September 30, 2023 and December

provided that, on March 1, 2023, May 1, 2023 and July 1, 2023, the interest rate on the Bridge Notes will increase by 1.5%

per annum, with maturity on December 31, 2023.

The Bridge Notes are subject to certain mandatory prepayment requirements, including,

but not limited to, a requirement that we apply the net proceeds from certain debt incurrences or equity offerings to repay the Bridge

We may elect to prepay the Bridge Notes, at any time, at our option at 100% of the principal amount.

The Bridge Notes are secured

by liens on the same collateral that secures indebtedness under our outstanding Senior Secured Notes (as defined below) and are guaranteed

by our subsidiaries that guarantee the Third A&R NPA.

The Note Purchase Agreement contains covenants and events of default substantially

similar to those contained in the note purchase agreement that governed the Third A&R NPA.

The proceeds received were used for the

acquisition of Men’s Journal and to repay $5,928 of our existing Delayed Draw Term Notes (as defined below).

The aggregate principal

amount outstanding under the Bridge Notes as of December

31, 2022 was $36,000.

Secured Notes .

We are party to a third amended and restated note purchase agreement (the “Third A&R NPA”), with one

accredited investor, BRF Finance, an affiliated entity of B.

The senior secured notes bears interest at a rate of 10% per annum.

Interest payments are payable at BRF Finance’s discretion either in cash quarterly in arrears on the last day of each quarter or

by adding the interest to the outstanding principal amount.

The senior secured notes has a final maturity date of December 31, 2023,

at which time the outstanding principal and all accrued but unpaid interest will be due.

The balance outstanding under our senior secured

notes as of December 31, 2022 was $62,691, which included

outstanding principal of $48,791 and payment of in-kind interest of $13,900 that we were permitted to add to the aggregate outstanding

principal balance.

Draw Term Notes .

Pursuant to the Third A&R NPA, we agreed to issue, at BRF Finance’s option, a delayed draw term notes

(the “Delayed Draw Term Notes”), in the aggregate principal amount of $12,000 to BRF Finance, of which $9,928 was outstanding

on December 31, 2021.

The Delayed Draw Term Notes bear interest at a rate of 10% per annum.

Interest payments are payable, at BRF Finance’s

discretion either in cash quarterly in arrears on the last day of each quarter or by adding the interest to the outstanding principal

The senior secured note has a final maturity date of December 31, 2023, at which time the outstanding principal and

all accrued but unpaid interest will be due.

The balance outstanding under our senior secured note as of the issuance date of

our consolidated financial statements for the year ended December 31, 2021 was approximately $64.3 million, which included outstanding

principal of approximately $48.8 million, payment of in-kind interest of approximately $13.9 million that we were permitted to

add to the aggregate outstanding principal balance, and unpaid accrued interest of approximately $1.6 million.

Draw Term Note .

Pursuant to the Second A&R NPA, we agreed to issue, at BRF Finance’s option, a delayed draw term note

(the “Delayed Draw Term Note”), in the aggregate principal amount of $12.0 million to BRF Finance.

2020, we drew down approximately $6.9 million under the Delayed Draw Term Note, and after payment of commitment and funding fees paid

to BRF Finance in the amount of approximately $0.7 million, and other of its legal fees and expenses that we incurred, we received net

proceeds of $6.0 million.

The Delayed Draw Term Note bears interest at a rate of 10% per annum.

Interest payments are payable,

at BRF Finance’s discretion, either in cash quarterly in arrears on the last day of each fiscal quarter or in kind

in arrears on the last day of each fiscal quarter.

The Delayed Draw Term Note has a final maturity date of December 31, 2023, at

which time the outstanding principal and accrued but unpaid interest will be due.

There is approximately $5.4 million of principal payment

due on the Delayed Draw Term Note on December 31, 2022, with the remaining principal balance due on December 31, 2023.

The aggregate

principal amount outstanding under the Delayed Draw Term Note as of the issuance date of our consolidated financial statements for the

year ended December 31, 2021 was approximately $10.2 million, which included outstanding principal

of approximately $8.7 million, and payment of in-kind interest of approximately $1.2

million that the Company was permitted to add to the aggregate outstanding principal balance, and

unpaid accrued interest of approximately $0.3 million .

entered into a non-binding letter of intent to acquire 100% of the issued and outstanding equity interests of Athlon Holdings, Inc.

for an anticipated purchase price of $16.0 million, comprised of (i) a cash portion of $13.0 million, with $10.0 million to be paid at

closing and $3.0 million to be paid post-closing and (ii) an equity portion of $3.0 million to be paid in shares of our common stock.

The acquisition is subject to the preparation and negotiation of definitive documents, completion of due diligence, and the agreement

of a certain number of key employees of Athlon to remain as employees post-closing, among other items.

discretion, either in cash quarterly in arrears on the last day of each fiscal quarter or in kind in arrears on the last day of each

fiscal quarter.

The Delayed Draw Term Notes have a final maturity date of December 31, 2023, at which time the outstanding principal

and accrued but unpaid interest will be due.

We paid $5,928 in principal that was due on December 31, 2022, with the remaining principal

balance due on December 31, 2023.

The aggregate principal amount outstanding under the Bridge Notes as of December 31, 2022 was $4,000.

January 11, 2023, we entered into an asset purchase agreement with Teneology, Inc., pursuant to which we acquired certain assets

(consisting of the RoadFood media business, including digital and television assets;

Moveable Feast media business, including digital and television assets;

Fexy-branded content studio business;

and the MonkeySee YouTube Channel media business), for a purchase price of $2,956.

purchase price consisted of the following:

(1) $500 cash paid at closing;

(2) $75 cash payments due in three equal installments of

$25 on March 1, 2023, April 1, 2023 and May 1, 2023;

(3) $200 deferred cash payment due on the first anniversary of the closing

date, subject to certain indemnity provisions;

and (4) the issuance of 274,692 shares of our common stock, subject to certain

lock-up provisions, on the closing date with a fair value of $2,181 (fair value was determined based on our common stock trading

price of $7.94 per share on the closing date).

The number of shares of our common stock issued was determined based on a $2,225

value using our common stock trading price on the day immediately preceding the January 11, 2023 closing date.

Sheet Arrangements

of December 31, 2022, pursuant to our line of credit with SLR, as disclosed above, in the event that our line of credit is

accelerated, we will be obligated to pay SLR a termination fee of $900.

Contractual Obligations

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to merchandise, equipment, and third-party services, the majority of which are due in the next 12 months.

See Notes 7, 15 and 19

in our accompanying consolidated financial statements for amounts outstanding as of December 31, 2021, related to leases, liquidated

damages and long-term debt.

respect to leases, we subleased our office space

in Santa Monica, California in November 2021 and remain responsible to the original lessor for approximately $1.3 million through

September 2024.

Pursuant to the sublease, the sublessee will pay us an aggregate of approximately $0.6 million through September

See Note 8, Leases,

Note 16, Liquidated Damages Payable, Note 19 , Bridge Notes , and Note 20, Long-term Debt , in our accompanying consolidated

financial statements for amounts outstanding as of December 31, 2022, related to leases, liquidated damages, bridge financing and long-term

2022, we assumed the lease from Men’s Journal for office space in Carlsbad, California, that expires in March 2025, and we remain

responsible for $3,189 over the lease term.

The lease provides for fixed payments of $89 for three months, $92 for twelve months and

$94 for twelve months, with an estimate of common expenses per month of $25 through the end of the lease term.

respect to leases, we subleased our office space in Santa Monica, California in November 2021 and remain responsible to the original

lessor for $948 through October 2024.

Pursuant to the sublease, the sublessee will pay us an aggregate of $477 through October 2024.

2021, we entered into a termination agreement of our sublease agreement for a property located in New York, New York and remain responsible

for approximately $9.0 million in cash payments to the sublandlord through October 2024.

we may have a contingent liability arising out of possible violations of the Securities Act in connection with the Original PowerPoint,

which we furnished as Exhibit 99.2 to our Current Report on Form 8-K and Current Report on Form 8-K/A filed on January 31, 2022 and February

1, 2022, respectively.

Specifically, the furnishing of the Original PowerPoint publicly may have constituted an “offer to sell”

as described in Section 5(b)(1) of the Securities Act and the Original PowerPoint may be deemed to be a prospectus that does not meet

the requirements of Section 10 of the Securities Act, resulting in a potential violation of Section 5(b)(1) of the Securities Act.

liability would depend upon the number of shares purchased by investors who reviewed and relied upon such Original PowerPoint that may

have constituted a potential violation of Section 5 of the Securities Act.

If a claim were brought by any such ‘recipients’

of such Original PowerPoint and a court were to conclude that the public disclosure of such PowerPoint constituted a violation of Section

5 of the Securities Act, we could be required to repurchase the shares sold to the investors who reviewed such Original PowerPoint at

the original purchase price, plus statutory interest.

We could also incur considerable expense in contesting any such claims.

date of this Annual Report, no legal proceedings or claims have been made or threatened by any investors in our offering.

Such payments

and expenses, if required, could significantly reduce the amount of working capital we have available for our operations and business

plan, delay or prevent us from completing our plan of operations, or force us to raise additional funding, which funding may not be available

on favorable terms, if at all.

See also the “Risk Factor” entitled “We may have contingent liability arising out of

a possible violation of the Securities Act, in connection with the Original PowerPoint which we furnished as Exhibit 99.2 to our Current

Report on Form 8-K, and the Current Report on Form 8-K/A, filed with the SEC on January 31, 2022, and February 1, 2022, respectively”

for $8,000 in cash payments to the sublandlord through October 2024.

Capital Deficit

1 unchanged sentence

working capital deficit as of December 31, 2022 and 2021 was as follows:

As of December 31,

of December 31,

Current assets

Current liabilities

(116,412,415 )

(107,562,825 )

Working capital deficit

(38,741,397 )

(33,716,360 )

of December 31, 2021, we had a working capital deficit of approximately $38.7 million, as compared to approximately $33.7 million

as of December 31, 2020, consisting of approximately $77.7 million in total current assets and approximately $116.4 million

in total current liabilities.

Included in current assets as of December 31, 2021, was approximately $0.5 million of restricted cash,

leaving a working capital deficit that requires cash payments of approximately $39.2 million.

As of December 31, 2020, our

working capital deficit consisted of approximately $73.8 million in total current assets and approximately $107.6 million in total current

of December 31, 2022, we had a working capital deficit of $137,669, as compared to $38,742 as of December 31, 2021, consisting of $78,695

in total current assets and $216,364 in total current liabilities.

As of December 31, 2021, our working capital deficit consisted of

$77,671 in total current assets and $116,413 in total current liabilities.

cash flows during the years ended December 31, 2022 and 2021 consisted of the following:

Years Ended December 31,

Ended December 31,

Net cash used in operating activities

$ (14,729,389 )

$ (32,294,587 )

Net cash used in investing activities

(13,145,958 )

Net cash provided by financing activities

1 unchanged sentence

Cash, cash equivalents, and restricted cash, end of year

the year ended December 31, 2021, net cash used in operating activities was approximately $14.7 million, consisting primarily of approximately

$172.6 million of cash received from customers (including payments received in advance of performance obligations) less

(a) approximately $185.9 million of cash paid (i) to employees, Publisher Partners, Expert Contributors,

suppliers, and vendors, and (ii) for revenue share arrangements and professional services;

and (b) approximately $1.4 million

of cash paid for interest.

For the year ended December 31, 2020, net cash used in operating activities was approximately $32.3

million, consisting primarily of:

approximately $116.0 million of cash received from customers (including payments received in advance

of performance obligations) less (a) approximately $148.3 million of cash paid (i) to employees, Publisher Partners,

suppliers, and vendors, and (ii) for revenue share arrangements, advance of royalty fees and professional services;

approximately $0.6 million of cash paid for interest.

the year ended December 31, 2021, net cash used in investing activities was approximately $13.1 million, consisting primarily of:

approximately $8.0 million used to acquire a business;

(ii) approximately $0.4 million for property and equipment;

and (iii) approximately

$4.8 million for capitalized costs for our Platform.

For the year ended December 31, 2020, net cash used in investing activities

was approximately $4.9 million consisting primarily of:

(i) approximately $0.3 million used for the acquisition of a business;

(ii) approximately $1.2 million for property and equipment;

(iii) approximately $0.4 million from proceeds for the sale

of intangible assets;

and (iv) approximately $3.8 million for capitalized costs for our Platform.

the year ended December 31, 2021, net cash used by financing activities was approximately $28.2 million, consisting primarily of:

approximately $19.8 million in net proceeds from the private placement issuance of common stock;

(ii) approximately $5.1 million in net

proceeds from the Delayed Draw Term Note;

(iii) approximately $4.8 million from borrowing under our FastPay line of credit;

(iv) approximately $1.5 million in payments of restricted stock liabilities;

and (v) approximately $0.1 million in payments for taxes

relating to repurchase of restricted shares.

For the year ended December 31, 2020, where net cash provided by financing activities

was approximately $37.3 million, consisting primarily of:

(i) approximately $20.8 million in net proceeds from the issuance of Series

H Preferred Stock (the “Series H Preferred Stock”) and Series J Convertible Preferred Stock (the “Series J Preferred

Stock”) and Series K Convertible Preferred Stock (“Series K Preferred Stock”);

(ii) approximately $11.1 million in

net proceeds from the Delayed Draw Term Note and the Payroll Protection Program Loan;

and (iii) approximately $7.2 million in borrowings

of our FastPay line of credit;

less (iv) approximately $0.5 million in payments for taxes relating to the withholding of shares

upon the repurchase of restricted shares of our common stock;

and (v) approximately $1.1 million in repayments under the 12% senior

secured subordinated convertible debentures (referred to herein as the “12% convertible debentures”).

the year ended December 31, 2022, net cash used in operating activities was $11,304, consisting primarily of $219,282 of cash paid to

employees, Publisher Partners, expert contributors, suppliers, and vendors, and for revenue share arrangements, advance of royalty fees

and professional services;

and $9,528 of cash paid for interest, offset by $219,407 of cash received from customers.

For the year ended

December 31, 2021, net cash used in operating activities was $14,729, consisting primarily of $184,932 of cash paid to employees, Publisher

Partners, expert contributors, suppliers, and vendors, and for revenue share arrangements, advance of royalty fees and professional services;

and $1,393 of cash paid for interest, offset by $171,596 of cash received from customers.

the year ended December 31, 2022, net cash used in investing activities was $38,590, consisting primarily of $35,331 for the acquisition

of a business;

$5,179 for capitalized costs for our Platform;

and $530 for property and equipment, offset by $2,450 from the sale of

an equity investment.

For the year ended December 31, 2021, net cash used in investing activities was $13,146, consisting primarily of

$7,950 for the acquisition of businesses;

$4,819 for capitalized costs for our Platform;

and $377 for property and equipment.

the year ended December 31, 2022, net cash provided by financing activities was $54,416, consisting primarily of $30,490 (net of issuance

costs paid of $1,568) in net proceeds from a public offering of common stock;

$28,800 (net of issuance costs paid of $1,272 and payments

of $5,928) in proceeds from long term-debt;

$2,104 from advancements of our SLR line of credit;

and $95 from exercises of common stock

options, offset by $4,468 for tax payments relating to the withholding of shares of common stock for certain employees;

$2,152 related

to payments of restricted stock liabilities;

and $453 payment for The Spun deferred cash payment.

For the year ended December 31, 2021,

net cash provided by financing activities was $28,191 consisting primarily of $19,838 (net of issuance cost paid of $167) in net proceeds

from a private placement of common stock;

$5,086 in proceeds from long term-debt;

$4,809 from advancements of our SLR line of credit,

offset by $1,472 related to payments of restricted stock liabilities;

and $70 for tax payments relating to the withholding of shares

of common stock for certain employees.

of Operations

2 unchanged sentences

2022 versus 2021

$ 189,140,334

$ 128,032,397

Cost of revenue

8 unchanged sentences

Loss from operations

(84,279,778 )

(71,187,133 )

(13,092,645 )

Total other expenses

(17,833,998 )

(10,499,689 )

Loss before income taxes

(91,614,087 )

(89,021,131 )

Income tax benefit (provision)

(89,939,653 )

(89,231,963 )

Deemed dividend on convertible preferred stock

(15,642,595 )

Net loss attributable to common stockholders

$ (89,939,653 )

$ (104,874,558 )

$ (14,934,905 )

Income tax benefit

Net loss from continuing operations

Net loss from discontinued operations, net of tax

Basic and diluted net loss per common share:

Continued operations

Discontinued operations

Basic and diluted net loss per common share

Weighted average number of shares outstanding – basic and diluted

the year ended December 31, 2021, the net loss attributable to common stockholders was approximately $89.9 million, as

compared to $104.9 million in the prior year which represents an improvement of $14.9 million.

The primary reason for the improvement

in net loss attributable to common stockholders is a result of a $61.1 million increase in revenue which was offset by a combined increase

in cost of revenue and operating expenses of $71.2 million during the year ended December 31, 2021.

Operating expenses included

a charge of $7.8 million related to a lease termination and the loss on a lease impairment and an increase in stock-based

compensation of approximately $15.9 million during the year ended December 31, 2021.

The increase in revenues was attributable

to management’s decision to make a strategic shift to focus on premium content providers and reduced reliance on Partner Publisher

guarantees in September 2020 as well as the addition of the results of The Spun, which was acquired in June 2021.

following table sets forth revenue, cost of revenue, and gross profit:

the year ended December 31, 2022, the net loss was $70,858, as compared to $89,940 in the prior year which represents an improvement

of $19,082 or 21.2%.

The primary reasons for the improvement in net loss are a $9,402 improvement in gross profit and a $18,994 reduction

in operating expenses.

The increase in gross profit reflected a $31,795 increase in total revenues, which was principally driven by the

continuing growth of our digital advertising business which grew $46,452 or 73.9% in the year ended December 31, 2022 as compared to

the prior year.

following table sets forth revenue, cost of revenue, and gross profit from continuing operations:

Years Ended December 31,

2022 versus 2021

$ 189,140,334

$ 128,032,397

Cost of revenue

the year ended December 31, 2021, we had gross profit of approximately $78.2 million, as compared to gross profit of approximately $25.0

million for year ended December 31, 2020.

following table sets forth revenue by category:

the year ended December 31, 2022, we had gross profit of $88,012, as compared to gross profit of $78,610 for year ended December 31,

following table sets forth revenue from continuing operations by category:

Years Ended December 31,

2022 versus 2021

2 unchanged sentences

Digital subscriptions

Other revenue

Licensing and syndication revenue

Other digital revenue

Total digital revenue

4 unchanged sentences

Total revenue

$ 189,140,334

$ 128,032,397

the year ended December 31, 2021, the primary sources of revenue were as follows:

(i) digital advertising of approximately $62.9 million;

(ii) digital subscriptions of approximately $29.6 million;

(iii) other digital revenue of approximately $8.5 million;

(iv) print advertising

of approximately $9.1 million and (iv) print subscriptions of approximately $79.1 million.

Our digital advertising

revenue increased by approximately $28.2 million, primarily due to additional revenue of approximately $14.1 million generated

as a result of The Spun business, which was acquired during the second quarter of 2021, $9.9 million from Sports Illustrated due to

an increase in advertising sponsorships, approximately $5.8 million generated from other business, all of which was

partially offset by a $1.5 million decrease in revenue from TheStreet.

Our digital subscriptions increased by approximately $1.1 million.

Our other digital revenue, primarily consisting of licensing and e-commerce revenue, increased by approximately $3.9 million due to additional

revenue for certain licensing agreements related to, SI Swim and other Sports Illustrated media businesses.

Our print advertising decreased

by approximately $0.7 million.

Our print subscriptions increased by approximately $28.5 million reflecting a drive to increase subscribers

in the fourth quarter of 2020 and the diminishing effect of acquisition accounting adjustments on the subscribers that existed when we

began operating the Sports Illustrated media business.

following table sets forth cost of revenue by category:

the year ended December 31, 2022 we recognized revenue from continuing operations of $220,935, as compared to $189,140 for the year ended

December 31, 2021, which represents an increase of $31,795 or 16.8%.

Our digital advertising revenue increased by $46,452 or 73.9%, primarily

due to a 47.1% increase in monthly average pageviews and a 13.1% increase in RPM for the year ended December 31, 2022, as compared to

the prior year with 76.0% of the total increase driven by organic growth.

Licensing and syndication revenue increased by $9,702 or 114.5%

as we added new relationships during the year and expanded existing ones to leverage our content with increased monetization.

Other digital

revenue, primarily consisting of e-commerce and sponsorship revenue, increased by $1,123 largely attributable to the expansion of our

e-commerce business.

Our print subscriptions decreased by $18,172 or 23.0% principally related to our Sports Illustrated media business

which reflected our planned rate base reduction of 29.0% from 1.7 million fiscal 2021 to 1.2 million in fiscal 2022 to focus on more

profitable subscriptions.

following table sets forth cost of revenue from continuing operations by category:

Years Ended December 31,

1 unchanged sentence

Publisher Partner revenue share payments

Hosting, bandwidth, and software licensing fees

Fees paid for data analytics and to other outside services providers

Technology, Platform and software licensing fees

Content and editorial expenses

4 unchanged sentences

Total cost of revenue

$ 110,977,736

$ 103,063,445

the year ended December 31, 2021, we recognized cost of revenue of approximately $111.0 million, which represented a 41.3% gross profit

percentage, compared to approximately $103.1 million in the year ended December 31, 2020, representing a 19.5% gross profit percentage.

The increase in the cost of revenue of approximately $7.9 million during the year ended December 31, 2021 is primarily from increases

(i) stock-based compensation of approximately $3.1 million;

(ii) content and editorial expense of approximately $2.9 million;

our Publisher Partner revenue share payments of approximately $2.1 million;

(iv) other costs of revenue related to SI Swim of approximately

$1.3 million;

less (v) printing, distribution, and fulfillment costs of approximately $1.5 million.

The improvement in gross profit percentage

was due to a decrease in Publisher Partner revenue shares from 56% of digital advertising revenue in fiscal 2020

to 34% in fiscal 2021 as a result of our strategic shift to eliminate most Publisher Partner guarantees near

the end of fiscal 2020 and the high contribution margin of digital advertising.

the year ended December 31, 2021, we capitalized costs related to our Platform of approximately $6.9 million, as compared to approximately

$5.4 million for the year ended December 31, 2020.

For the year ended December 31, 2020, the capitalization of our Platform consisted

(i) approximately $4.8 million in payroll and related expenses, including taxes and benefits;

and (ii) approximately $2.0 million

in stock-based compensation for related personnel.

following table sets forth operating expenses:

the year ended December 31, 2022, as referenced in the above table, we recognized cost of revenue from continuing operations of $132,923,

as compared to $110,530 for the year ended December 31, 2021, which represents an increase of $22,393 or 20.3% from the prior period.

Cost of revenue for the year ended December 31, 2022 was impacted by increases in content and editorial expenses of $11,819;

Platform and software licensing fees of $8,324, consisting of costs incurred for the Parade acquisition and other investments made to

our Platform;

and stock-based compensation of $2,757;

partially offset by a decrease in Publisher Partner revenue share payments of $1,460.

The increase in content and editorial expense was primarily due to significant investments made in the second half of fiscal 2021 to

expand our audience development and social media capabilities, in addition to the acquisition of Parade which occurred in the second

quarter of 2022.

Publisher Partner revenue share payments have decreased despite a growth in our digital advertising revenue due primarily

to a favorable change in the terms of certain of our Publisher Partner agreements.

This resulted in a more favorable revenue share structure

for us, especially as we continue to grow our premium programmatic and direct advertising revenue as a percentage of total digital revenue.

In addition, the decrease was also in part due to the expiration of our agreement with Jim Cramer in September 2021.

and Marketing

following table sets forth selling and marketing expenses from continuing operations by category:

Years Ended December 31,

2022 versus 2021

Selling and marketing

General and administrative

Depreciation and amortization

Loss on disposition of assets

Loss on impairment of lease

Loss on termination of lease

Total operating expenses

$ 162,442,376

and Marketing .

For the year ended December 31, 2021, we incurred selling and marketing costs of approximately $82.7 million, as compared

to approximately $43.6 million for the year ended December 31, 2020.

The increase in selling and marketing costs of approximately $39.1

million is primarily from an increase in circulation costs of approximately $31.6 million;

payroll of selling and marketing account

management support teams, along with the related benefits and stock-based compensation of approximately $4.8 million;

an increase in

advertising costs of approximately $2.4 million;

an increase in professional and marketing service costs of approximately $2.0 million;

less a decrease in office, travel, conferences and occupancy costs of approximately $0.5 million and other selling and marketing related

costs of approximately $1.2 million.

Payroll and employee benefits of selling and marketing account management support teams

Stock-based compensation

Professional marketing services

Circulation costs

Subscription acquisition costs

Advertising costs

Other selling and marketing expenses

Total selling and marketing

the year ended December 31, 2022, as referenced in the above table, we incurred selling and marketing expenses from continuing operations

of $72,489 as compared to $81,929 for the year ended December 31, 2021, a decrease of $9,440 or 11.5% from the prior period.

in selling and marketing expenses of $9,440 was primarily due to decreases in subscription acquisition costs of $9,074 and stock-based

compensation of $2,604.

Partially offsetting these decreases, payroll and employee benefits of selling and marketing account management support

teams increased $1,721 and circulation costs grew by $862, both of which were a result of the addition of the Parade properties, which

were acquired in the second quarter of 2022.

The decrease in subscription acquisition costs was due to the previously mentioned 29.0%

decrease in the Sports Illustrated rate base.

and Administrative

For the year ended December 31, 2021, we incurred general and administrative costs of approximately $54.4

million from payroll and related expenses, professional services, occupancy costs, stock-based compensation of related personnel,

depreciation and amortization, and other corporate expense, as compared to approximately $36.0 million for the year ended December 31,

The increase in general and administrative expenses of approximately $18.4 million is primarily from an increase in our

payroll, along with the related benefits and stock-compensation of approximately $15.8 million;

an increase in professional services,

including accounting, legal and insurance of approximately $1.7 million;

and an increase in other general corporate expenses of approximately $0.9 million.

following table sets forth general and administrative expenses from continuing operations by category:

Years Ended December 31,

2022 versus 2021

Payroll and related expenses for executive and administrative personnel

Stock-based compensation

Professional services, including accounting, legal and insurance

Other general and administrative expenses

Total general and administrative

the year ended December 31, 2022, as referenced in the above table, we incurred general and administrative expenses from continuing operations

of $53,499 as compared to $55,612 for the year ended December 31, 2021, a decrease of $2,113 or 3.8% from the prior period.

is primarily related to $1,721 of payroll and related expenses which reflected a decrease in certain personnel costs offset by the acquisition

of Parade which occurred in the second quarter of 2022.

(Expenses) Income

following table sets forth other (expenses) income:

Ended December 31,

in valuation of warrant derivative liabilities

in valuation of embedded derivative liabilities

on conversion of convertible debentures

(10,454,618 )

(16,497,217 )

upon debt extinguishment

other expenses

$ (7,334,309 )

$ (17,833,998 )

in Valuation of Warrant Derivative Liabilities .

The change in valuation of warrant derivative liabilities for the year ended December

31, 2021 was the result of the decrease in the fair value of the warrant derivative liabilities as of December 31, 2021, as compared

to the change in the valuation for the year ended December 31, 2020.

The change in the valuation is not impacted by our actual

business operations but is instead strongly tied to the change in the market value of our common stock.

in Valuation of Embedded Derivative Liabilities .

The change in valuation of embedded derivative liabilities for the year ended December

31, 2021 was the result of the decrease in the fair value of the embedded derivative liabilities as of December 31, 2021, as compared

to the change in the valuation for the year ended December 31, 2020.

on Conversion of Convertible Debentures .

We recognized a loss on conversion of approximately $3.3 million for the year ended December

31, 2020 as the result of the conversion of accrued interest due and payable under the 12% convertible debentures into

shares of our common stock.

We incurred interest expense of approximately $10.5 million for the year ended December 31, 2021, as compared to approximately

$16.5 million for the year ended December 31, 2020.

The decrease in interest expense of approximately $6.0 million is primarily due to

an increase in cash paid interest of approximately $0.7 million offset by a $4.5 million decrease in amortization of debt discount

on notes payable and a $2.3 million decrease in accrued interest.

We recorded approximately $2.6 million of liquidated damages, including the accrued interest thereon, during the

year ended December 31, 2021 primarily from the issuance of our 12% convertible debentures, Series H Preferred Stock, Series I Convertible

Preferred Stock (“Series I Preferred Stock”), Series J Convertible Preferred Stock (“Series J Preferred Stock”)

and Series K Convertible Preferred Stock (“Series K Preferred Stock”) in fiscal 2020 since we determined that:

registration statements registering for resale the shares of our common stock issuable upon conversion of the 12% convertible

debentures, Series I Preferred Stock, Series J Preferred Stock and Series K Preferred Stock would not be declared effective

within the requisite time frame;

and (ii) that we would not be able to become current in our periodic filing obligations with the SEC

in order to satisfy the public information requirements under the applicable securities purchase agreements.

We recorded liquidated damages,

including the accrued interest thereon, of approximately $1.5 million in fiscal 2020 primarily from issuance of our 12%

convertible debentures, Series H Preferred Stock, Series I Preferred Stock and Series J Preferred Stock, which liquidated damages were

based upon the reasons set forth above.

Years Ended December 31,

2022 versus 2021

Change in valuation of warrant derivative liabilities

Interest expense, net

Liquidated damages

Gain upon debt extinguishment

Total other expenses

We incurred interest expense, net of $11,428 for the year ended December 31, 2022, as compared to $10,449 for the year ended

December 31, 2021.

The increase in interest expense of $979 was primarily from additional cash paid for interest from our debt.

We recorded liquidated damages of $1,140 for the year ended December

31, 2022, as compared to $2,637 for the year ended December 31, 2021.

The liquidated damages recorded of $1,140 for the year ended December

31, 2022 primarily resulted from additional liquidated damages assessed under certain agreements as a result of filing a registration

statement outside of the agreed upon filing deadline and recording interest expense on the balance that remains outstanding.

Upon Debt Extinguishment .

We recorded a gain upon debt extinguishment (including accrued interest) of approximately $5.7 million

for the year ended December 31, 2021 pursuant to the forgiveness of the Payroll Protection Program Loan.

Tax Benefit (Provision)

Tax Benefit (Provision) .

For the year ended December 31, 2021, the Company recorded a deferred income tax benefit of approximately

$1.7 million primarily related to its acquired deferred tax liabilities from the acquisition of The Spun and change in valuation allowance

as of year- end that was, in part, offset by the book to tax basis differences related to goodwill from certain prior year acquisitions.

For the year ended December 31, 2020, the Company recorded a deferred income tax provision of approximately $0.2 million to account for

the book to tax basis differences related to goodwill from certain prior year acquisitions.

We recorded a gain upon debt extinguishment (including accrued interest) of $5,717 for the year ended December

31, 2021 pursuant to the forgiveness of the Payroll Protection Program Loan.

Tax Benefit .

For the year ended December 31, 2022, we recorded a deferred income tax benefit of $1,063 primarily related

to our acquired deferred tax liabilities from an acquisition during the year and change in valuation allowance as of year-end that was,

in part, offset by the book to tax basis differences related to goodwill from certain prior year acquisitions.

For the year ended December

31, 2021, we recorded a deferred income tax benefit of $1,674 primarily related to our acquired deferred tax liabilities from an acquisition

during the year and change in valuation allowance as of year-end that was, in part, offset by the book to tax basis differences related

to goodwill from certain prior year acquisitions.

further details refer to Note 25, Income Taxes , in our accompanying consolidated financial statements.

Dividend on Convertible Preferred Stock

H Preferred Stock .

During fiscal 2020, in connection with the issuance of 108 shares (issued on August 19, 2020) and 389 shares

(issued on October 31, 2020) of our Series H Preferred Stock, we recorded a beneficial conversion feature of approximately $0.1 million

and approximately $0.4 million, respectively (totaling approximately $0.7 million), for the underlying shares of our common stock since

the nondetachable conversion feature was in-the-money (the per-share conversion price of $7.26 was lower than our per-share

common stock trading price of $18.92 and $16.94 at the issuance dates of August 19, 2020 and October 31, 2020, respectively).

The beneficial conversion feature was recognized as a deemed dividend.

I Preferred Stock .

On December 18, 2020, all of the shares of our Series I Preferred Stock converted automatically into shares

of our common stock as a result of the increase in the number of authorized shares of our common stock.

Upon conversion, we recognized

a beneficial conversion feature for the underlying shares of our common stock since the nondetachable conversion feature was in-the-money

(the per-share conversion price of $11.00 was lower than our per-share common stock trading price of $13.42

at the conversion date).

The beneficial conversion feature was recognized as a deemed dividend.

J Preferred Stock .

On December 18, 2020, all of the shares of our Series J Preferred Stock converted automatically into shares

of our common stock as a result of the increase in the number of authorized shares of our common stock.

Upon conversion, we recognized

a beneficial conversion feature for the underlying shares of our common stock since the nondetachable conversion feature was in-the-money

(the effective per-share conversion price of $8.80 for the issuance of our Series J Preferred Stock on September 4, 2020

(these shares were issued at a discount) was lower than our per-share common stock trading price of $13.42 at the conversion

The beneficial conversion feature was recognized as a deemed dividend.

K Preferred Stock .

On December 18, 2020, all of the shares of our Series K Preferred Stock converted automatically into shares

of our common stock as a result of the increase in the number of authorized shares of our common stock.

Upon conversion, we recognized

a beneficial conversion feature for the underlying shares of our common stock since the nondetachable conversion feature was in-the-money

(the per-share conversion price of $8.80 was lower than our common stock trading price of $13.42 at the conversion

The beneficial conversion feature was recognized as a deemed dividend.

of Non-GAAP Financial Measures

report our financial results in accordance with generally accepted accounting principles in the United States of America (“GAAP”);

however, management believes that certain non-GAAP financial measures provide users of our financial information with useful supplemental

information that enables a better comparison of our performance across periods.

We believe Adjusted EBITDA provides visibility to the

underlying continuing operating performance by excluding the impact of certain items that are noncash in nature or not related

to our core business operations.

We calculate Adjusted EBITDA as net loss, adjusted for (i) interest expense (net), (ii) income taxes,

(iii) depreciation and amortization, (iv) stock-based compensation, (v) change in derivative valuations, (vi)

liquidated damages, (vii) loss on disposition of assets, (viii) loss on impairment of lease, (ix) loss on lease

termination, (x) gain upon debt extinguishment, (xi) professional and vendor fees, and (xii) employee restructuring

report our financial results in accordance with generally accepted accounting principles in the United States of America

however, management believes that certain non-GAAP financial measures provide users of our financial

information with useful supplemental information that enables a better comparison of our performance across periods.

Adjusted EBITDA provides visibility to the underlying continuing operating performance by excluding the impact of certain items that

are noncash in nature or not related to our core business operations.

We calculate Adjusted EBITDA as net loss as adjusted for loss

from discontinued operations, with additional adjustments for (i) interest expense (net), (ii) income taxes, (iii) depreciation and

amortization, (iv) stock-based compensation, (v) change in derivative valuations, (vi) liquidated damages, (vii) gain upon debt

extinguishment, (viii) loss on impairment of assets;

(x) loss on impairment of lease, (ix) loss on lease termination, (xi)

professional and vendor fees, and (xii) employee restructuring payments.

non-GAAP Adjusted EBITDA may not be comparable to a similarly titled measure used by other companies, has limitations as an analytical

4 unchanged sentences

Some of the limitations is that Adjusted EBITDA:

does not reflect stock-based compensation and, therefore,

does not include all of our compensation costs;

not reflect depreciation and amortization expense and, although this is a noncash expense, the assets being depreciated may

have to be replaced in the future, increasing our cash requirements;

not reflect interest expense and financing fees, or the cash required to service our debt, which reduces cash available to

not reflect interest expense and financing fees, or the cash required to service our debt,

which reduces cash available to us;

not reflect deferred income tax benefit or provision, which is a noncash income or expense;

not reflect the change in derivative valuations and, although this is a noncash income or expense, the change in the valuations

each reporting period are not impacted by our actual business operations but is instead strongly tied to the change in the market

value of our common stock;

not reflect liquidated damages and, therefore, does not include future cash requirements if we repay the liquidated damages in cash

instead of shares of our common stock (which the investor would need to agree to);

not reflect any losses from the disposition of assets, which is a noncash operating expense;

not reflect depreciation and amortization expense and, although this is a noncash expense,

the assets being depreciated may have to be replaced in the future, increasing our cash requirements;

● does not reflect stock-based compensation and, therefore, does not include all of our compensation costs;

not reflect the change in derivative valuations and, although this is a noncash income or

expense, the change in the valuations each reporting period are not impacted by our actual

business operations but is instead strongly tied to the change in the market value of our

common stock;

not reflect liquidated damages and, therefore, does not include future cash requirements

if we repay the liquidated damages in cash instead of shares of our common stock (which the

investor would need to agree to);

● does not reflect any gains upon debt extinguishment, which we do not consider in our evaluation of our business operations;

● does not reflect any losses from the impairment of assets, which is a noncash operating expense;

not reflect any losses on impairment of leases, which is a noncash operating expense;

not reflect any losses on termination of our leases, which is a noncash operating expense;

does not reflect any gains upon debt extinguishment,

which we do not consider in our evaluation of our business operations;

not reflect the professional and vendor fees incurred by us for services provided by consultants, accountants, lawyers,

and other vendors, which services were related to certain types of events that are not reflective of our business operations;

not reflect payments related to employee restructuring changes in fiscal 2020 and 2021 related to COVID-19 workforce reductions,

leadership changes, and settlement and severance payments, which were a significant cash expense but are not reflective of our

business operations.

not reflect the professional and vendor fees incurred by us for services provided by consultants,

accountants, lawyers, and other vendors, which services were related to certain types of

events that are not reflective of our business operations;

not reflect payments related to employee severance, which were a cash expense but are not reflective of our business operations.

following table presents a reconciliation of Adjusted EBITDA to net loss, which is the most directly comparable GAAP measure, for the

1 unchanged sentence

Years Ended December 31,

$ (89,939,653 )

$ (89,231,963 )

Loss from discontinued operations, net of tax

Loss from continuing operations

Add (deduct):

Interest expense, net (1)

Income tax (benefit) provision

Income tax benefit

Depreciation and amortization (2)

2 unchanged sentences

Liquidated damages (4)

Loss on disposition of assets (5)

Loss on impairment of lease (6)

Loss on termination of lease (7)

Loss on conversion of convertible debt

Gain upon debt extinguishment (5)

Loss on impairment of assets (6)

Loss on impairment of lease (7)

Loss on lease termination (8)

Professional and vendor fees (9)

1 unchanged sentence

Adjusted EBITDA

$ (12,060,659 )

$ (23,193,797 )

interest expense of approximately $10.5 million and approximately $16.5 million, less interest income of none

and approximately $0.3 million for the years ended December 31, 2021 and 2020, respectively.

Interest expense is related

to our capital structure.

Interest expense varies over time due to a variety of financing transactions.

should note that interest expense will recur in future periods.

depreciation and amortization related to our developed technology and Platform included within cost of revenues of approximately

$8.9 million and approximately $8.6 million and depreciation and amortization included within operating expenses

of approximately $16.3 million and approximately $16.3 million for the years ended December 31, 2021 and 2020, respectively.

believe (i) the amount of depreciation and amortization expense in any specific period may not directly correlate to the underlying

performance of our business operations and (ii) such expenses can vary significantly between periods as a result of new acquisitions

and full amortization of previously acquired tangible and intangible assets.

Interest expense is related to our capital structure and varies over time due to a variety of financing transactions.

Interest expense includes $1,581 and $2,106 for amortization of debt discounts for the year ended December 31, 2022 and 2021,

respectively, as presented in our condensed consolidated statements of cash flows, which are a noncash item.

Investors should note

that interest expense will recur in future periods.

(2) Represents

depreciation and amortization related to our developed technology and Platform included within

cost of revenues of $9,459 and $8,829, for the years ending December 31, 2022 and 2021, respectively,

and depreciation and amortization included within operating expenses of $17,650 and $16,345

for the years ending December 31, 2022 and 2021, respectively.

We believe (i) the amount

of depreciation and amortization expense in any specific period may not directly correlate

to the underlying performance of our business operations and (ii) such expenses can vary

significantly between periods as a result of new acquisitions and full amortization of previously

acquired tangible and intangible assets.

Investors should note that the use of tangible and

intangible assets contributed to revenue in the periods presented and will contribute to future revenue generation and should also

note that such expense will recur in future periods.

noncash costs arising from the grant of stock-based awards to employees, consultants and directors.

We believe that excluding

the effect of stock-based compensation from Adjusted EBITDA assists management and investors in making period-to-period comparisons

in our operating performance because (i) the amount of such expenses in any specific period may not directly correlate to the underlying

performance of our business operations, and (ii) such expenses can vary significantly between periods as a result of the timing of

grants of new stock-based awards, including grants in connection with acquisitions.

Additionally, we believe that excluding stock-based

compensation from Adjusted EBITDA assists management and investors in making meaningful comparisons between our operating performance

and the operating performance of other companies that may use different forms of employee compensation or different valuation methodologies

for their stock-based compensation.

Investors should note that stock-based compensation is a key incentive offered to employees whose

efforts contributed to the operating results in the periods presented and are expected to contribute to operating results in future

intangible assets contributed to revenue in the periods presented and will contribute to

future revenue generation and should also note that such expense will recur in future periods.

(3) Represents

noncash costs arising from the grant of stock-based awards to employees, consultants and

We believe that excluding the effect of stock-based compensation from Adjusted

EBITDA assists management and investors in making period-to-period comparisons in our operating

performance because (i) the amount of such expenses in any specific period may not directly

correlate to the underlying performance of our business operations, and (ii) such expenses

can vary significantly between periods as a result of the timing of grants of new stock-based

awards, including grants in connection with acquisitions.

Additionally, we believe that excluding

stock-based compensation from Adjusted EBITDA assists management and investors in making

meaningful comparisons between our operating performance and the operating performance of

other companies that may use different forms of employee compensation or different valuation

methodologies for their stock-based compensation.

Investors should note that stock-based

compensation is a key incentive offered to employees whose efforts contributed to the operating

results in the periods presented and are expected to contribute to operating results in future

Investors should also note that such expenses will recur in the future.

damages we owe to certain of our investors in private placements offerings conducted in fiscal years 2018 through 2020,

pursuant to which we agreed to certain covenants in the respective securities purchase agreements and registration rights agreements,

including the filing of resale registration statements and becoming current in our reporting obligations, which we were not able

to timely meet.

our disposition of certain assets related to the decision to no longer lease office space and other related disposition of

assets that no longer are useful.

the net loss for our right-of-use asset related to our lease in Santa Monica and related sublease of the office space

based on our decision to no longer lease office space.

our loss related to the surrender and termination of our lease of office space located in New York based on our decision

to no longer lease office space.

a gain upon extinguishment of the Payroll Protection Program Loan.

professional and vendor fees recorded in connection with services provided by consultants, accountants, lawyers, and other vendors

related to (i) the preparation of periodic reports in order for us to become current in our reporting obligations (“Delinquent

Reporting Obligations Services”), (ii) up-list to a national securities exchange, (iii) contemplated and completed

acquisitions, (iv) public and private offerings of our securities and other financings, and (v) stockholder disputes and the

implementation of our Rights Agreement.

With respect to the Delinquent Reporting Obligations Services, we incurred professional and

vendor fees in fiscal 2021 and 2020 related to the preparation of (x) our annual reports for fiscal years 2018, 2019 (which

contained the financial information for the quarterly periods during fiscal 2019), and 2020, (y) our quarterly reports for the

third quarter in fiscal 2018, the quarters in fiscal 2020, and the first and second quarters in fiscal 2021, and (z) our current

reports with respect to certain acquisitions, all of which reports were filed during fiscal 2020 and 2021.

The amount of fees

incurred in connection with the Delinquent Reporting Obligations Services is adjusted based on our best estimate of the amount we

expect we would ordinarily incur to meet our reporting obligations pursuant to the Exchange Act.

(i) severance payments paid in connection with COVID-19 workforce reductions in fiscal 2020 and (ii) severance and other settlement

payments paid in connection with employee and leadership changes in fiscal 2020 and 2021.

(4) Represents

damages (or interest expense related to accrued liquidated damages) we owe to certain of

our investors in private placements offerings conducted in fiscal years 2018 through 2020,

pursuant to which we agreed to certain covenants in the respective securities purchase agreements

and registration rights agreements, including the filing of resale registration statements

and becoming current in our reporting obligations, which we were not able to timely meet.

(5) Represents

a gain upon extinguishment of the Paycheck Protection Program Loan.

(6) Represents our impairment of certain assets that are no longer useful.

(7) Represents

our impairment of certain leased property that is no longer being used.

(8) Represents

our loss related to the surrender and termination of our lease of office space located in

New York based on our decision to no longer lease office space.

(9) Represents

one-time, non-recurring third party professional and vendor fees recorded in connection with

services provided by consultants, accountants, lawyers, and other vendors (these fees are

collectively referred to as “Professional Fees”) related to (i) the preparation

of periodic reports in order for us to become current on our Exchange Act reporting obligations,

(ii) up-list to a national exchange, (iii) contemplated and completed acquisitions, (iv)

public and private offerings of our securities and other financings, and (v) stockholder

disputes and the implementation of our Rights Agreement (the Rights Agreement is further

described in Note 21, Preferred Stock, in our accompanying consolidated financial

table below summarizes the costs defined above that we incurred during fiscal 2022 and 2021:

Years Ended December 31,

Catch-up periodic reports

Mergers and acquisitions

Public and private offerings and other financings

Stockholder disputes and Rights Agreement

(10) Represents

severance payments to our former Chief Executive

Officer for the years ending December 31, 2022 and 2021.

Accounting Policies and Estimates

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elsewhere in this Annual Report, which have been prepared in accordance with GAAP.

We believe the following critical accounting

policies affect our more significant judgments and estimates used in the preparation of the financial statements.

Actual results may

differ from these estimates under different assumptions or conditions.

accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, revenues are recognized

when control of the promised goods or services are transferred to our customers, in an amount that reflects the consideration that we

expect to receive in exchange for those goods or services.

We generate all of its revenue from contracts with customers.

We account for

revenue on a gross basis, as compared to a net basis, in its statement of operations.

We made this determination based on it taking the

credit risk in its revenue-generating transactions and it also being the primary obligor responsible for providing the services to the

Cost of revenues is presented as a separate line item in the statement of operations.

We believe the following critical accounting policies

affect our more significant judgments and estimates used in the preparation of the financial statements.

Actual results may differ from

these estimates under different assumptions or conditions.

accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers , revenues are

recognized when control of the promised goods or services are transferred to our customers, in an amount that reflects the consideration

that we expect to receive in exchange for those goods or services.

We generate all of our revenue from contracts with customers.

for revenue on a gross basis, as compared to a net basis, in our statement of operations.

We have made this determination based on our

control of the advertising inventory and the ability to monetize the advertising inventory or publications before transfer to the customer

and because we are also the primary obligor responsible for providing the services to the customer.

Cost of revenues is presented as

a separate line item in the statement of operations.

following is a description of the principal activities from which we generate revenue:

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for returns on historical experience and current marketplace conditions.

licensing-based revenues are accrued generally monthly or quarterly based on the specific mechanisms of each contract.

Generally, revenues

are accrued based on estimated sales and adjusted as actual sales are reported by partners.

These adjustments are typically recorded

within three months of the initial estimates and have not been material.

Any minimum guarantees are typically earned evenly over the

and Syndication Revenue

licensing-based revenues and syndication revenues are accrued generally monthly or quarterly based on the specific mechanisms of each

Generally, revenues are accrued based on estimated sales and adjusted as actual sales are reported by partners.

These adjustments

are typically recorded within three months of the initial estimates and have not been material.

Any minimum guarantees are typically

earned evenly over the fiscal year.

Modifications

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and the creation of a new contract, or a cumulative catch-up basis.

the years presented, substantially all of our technology expenses are development costs for our Platform that were capitalized

as intangible costs.

Technology costs are expensed as incurred or capitalized into property and equipment in accordance with the Financial

Accounting Standards Board (“FASB”) ASC Topic 350, Intangibles – Goodwill and Other .

ASC Topic 350 requires

that costs incurred in the preliminary project and post-implementation stages of an internal use software project be expensed as incurred

and that certain costs incurred in the application development stage of a project be capitalized.

the years presented, substantially all of our technology expenses are development costs for our Platform that were capitalized as intangible

Technology costs are expensed as incurred or capitalized into property and equipment in accordance with the Financial Accounting

Standards Board (“FASB”) ASC Topic 350, Intangibles – Goodwill and Other .

ASC Topic 350 requires that costs

incurred in the preliminary project and post-implementation stages of an internal use software project be expensed as incurred and that

certain costs incurred in the application development stage of a project be capitalized.

capitalize internal labor costs, including compensation, benefits and payroll taxes, incurred for certain capitalized platform development

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compensation of related personnel.

account for business combinations using the acquisition method of accounting.

The acquisition method of accounting requires that the

purchase price, including the fair value of contingent consideration, of the acquisition be allocated to the assets acquired and liabilities

assumed using the estimated fair values determined by management as of the acquisition date.

Goodwill is measured as the excess of consideration

transferred and the net fair values of the assets acquired, and the liabilities assumed at the date of acquisition.

While we use best

estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed

at the acquisition date, our estimates are inherently uncertain and subject to refinement.

As a result, during the measurement period,

we record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent we identified

adjustments to the preliminary purchase price allocation.

Upon the conclusion of the measurement period, which may be up to one year

from the acquisition date, or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any

subsequent adjustments are recorded to the consolidated statements of operations.

Additionally, we identify acquisition-related contingent

payments and determine their respective fair values as of the acquisition date, which are recorded as accrued liabilities on the consolidated

balance sheets.

Subsequent changes in fair value of contingent payments are recorded on the consolidated statements of operations.

expense transaction costs related to the acquisition as incurred.

represents the excess of the purchase price over the fair value of the net tangible and intangible assets of businesses acquired in a

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We have elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of

its single reporting unit is less than its carrying amount as a basis of determining whether it is necessary to perform the quantitative

our single reporting unit is less than its carrying amount as a basis of determining whether it is necessary to perform the quantitative

goodwill impairment test.

If we determine that it is more likely than not that its fair value is less than its carrying amount, then

If we determine that it is more likely than not that our fair value is less than its carrying amount, then

the quantitative goodwill impairment test will be performed.

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Compensation, in our accompanying consolidated financial statements).

account for stock awards and stock option grants to employees, directors and consultants, and non-employee awards to certain directors

and consultants by measuring the cost of services received in exchange for the stock-based payments as compensation expense in our consolidated

accounts for stock awards and stock option grants to employees, directors and consultants, and non-employee awards to certain directors

and consultants by measuring the cost of services received in exchange for the stock-based payments as compensation expense our consolidated

financial statements.

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and non-employees which are performance-vested, are measured at fair value on the grant date and charged to operations when the performance

condition is satisfied or over the service.

condition is satisfied or over the service period.

fair value measurement of equity awards and grants used for stock-based compensation is as follows:

(1) restricted stock awards and restricted

stock units which are time-vested, are determined using the quoted market price of the our common stock at the grant date;

option grants which are time-vested and performance-vested, are determined utilizing the Black-Scholes option-pricing model at the grant

stock units which are time-vested, are determined using the quoted market price of our common stock at the grant date;

(2) stock option

grants which are time-vested and performance-vested, are determined utilizing the Black-Scholes option-pricing model at the grant date;

(3) restricted stock units and stock option grants which provide for market-based vesting with a time-vesting overlay, are determined

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Estimated volatility,

is based on the historical volatility of our common stock and is evaluated based upon market comparisons.

The risk-free interest rate

is based on the U.S.

prior to the Up-List (as described below), was based on the historical volatility of our common stock and is evaluated based upon market

comparisons, thereafter, by evaluating the average historical volatility of a group of peer companies that are publicly traded.

The risk-free

interest rate is based on the U.S.

Treasury yield curve in effect at the time of grant.

The fair market value of common stock is determined by reference

to the quoted market price of our common stock.

fair value of the stock options granted are probability weighted under the Black-Scholes option-pricing model or Monte Carlo model as

determined through consultants with our independent valuation firm since the value of the stock options, among other things, depend on

the volatility of the underlying shares of our common stock, under the following two scenarios:

(1) scenario one assumes that our common

stock will be up-listed on a national stock exchange (the “Exchange”) on a certain listing date (the “Up-list”);

and (2) scenario two assumes that our common stock is not up-listed on the Exchange prior to the final vesting date of the grants (the

“No Up-list”), collectively referred to as the “Probability Weighted Scenarios”.

The fair market value of common stock is determined

by reference to the quoted market price of our common stock.

value determined under the Black-Scholes option-pricing model and Monte Carlo model is affected by several variables, the most significant

of which are the life of the stock award, the exercise price of the stock option or warrants, as compared to the fair market value of

the common stock on the grant date, and the estimated volatility of the common stock over the term of the stock award.

volatility was determined under the (1) “Probability Weighted Scenarios” where one scenario assumes that our common stock

will be up-listed on a national stock exchange (the “Exchange”) on a certain listing date (the “Up-list”) where

the estimated volatility was based on evaluating the average historical volatility of a group of peer companies that are publicly traded

and the second scenario assumes our common stock is not up-listed on the Exchange prior to the final vesting date of the grants (the

“No Up-list”) where the historical volatility of our common stock was evaluated based upon market comparisons;

“Up-list Scenario” where our estimated volatility is based on evaluating the average historical volatility of a group of

peer companies that are publicly traded after we up-listed to the NYSE American.

The risk-free interest rate is based on the U.S.

yield curve in effect at the time of grant.

The fair market value of common stock is determined by reference to the quoted market price

of our common stock.

We have elected to recognize forfeitures as they occur and to recognize stock-based compensation cost on a straight-line

basis over the total requisite service period for awards with graded vesting.

classify stock-based compensation cost on our consolidated statements of operations in the same manner in which the award recipient’s

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Quantitative and Qualitative Disclosures about Market Risk

applicable to a “smaller reporting company” as defined in Item 10(f)(1) of SEC Regulation S-K.

are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise

required under this item.

Financial Statements and Supplementary Data

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis