What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2022-03-02 compared with 2021-03-10 · 687 added, 938 removed, 876 unchanged (65% of the section changed)

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

CONSOLIDATED STATEMENT OF CHANGES IN CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY

CONSOLIDATED STATEMENTS OF CASH FLOWS

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We have audited the accompanying consolidated balance sheets of comScore, Inc.

and subsidiaries (the "Company") as of December 31, 2020 and 2019, the related consolidated statements of operations and comprehensive loss, stockholders' equity, and cash flows, for each of the three years in the period ended December 31, 2020, and the related notes (collectively referred to as the "financial statements").

and subsidiaries (the "Company") as of December 31, 2021 and 2020, the related consolidated statements of operations and comprehensive loss, changes in convertible redeemable preferred stock and stockholders' equity, and cash flows, for each of the three years in the period ended December 31, 2021, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 2, 2022, expressed an unqualified opinion on the Company's internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 2 to the financial statements, the Company has changed its method of accounting for leases as of January 1, 2019 due to adoption of Accounting Standards Codification (ASC) 842, Leases.

The Company adopted ASC 842 using the modified retrospective transition method with optional transition relief.

Basis for Opinion

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Once the Company elects one of the methods to estimate variable consideration for a particular type of performance obligation, the Company will apply that method consistently.

The Company allocates the transaction price to each performance obligation based on

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relative standalone selling price ("SSP").

The Company allocates the transaction price to each performance obligation based on relative standalone selling price ("SSP").

Judgment is exercised to determine the SSP of each distinct performance obligation.

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Customers may obtain the control of promised goods or services over time or at a point in time.

Given the complexity of certain of the Company's contracts, we concluded that revenue recognition from these contracts represents a critical audit matter because of the judgments necessary for management to identify performance obligations, determine the transaction price, allocate transaction price to the performance obligations and recognize revenue when performance obligations are satisfied.

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transaction price to the performance obligations and recognize revenue when performance obligations are satisfied.

Performing audit procedures related to revenue recognition for these contracts required more extensive audit effort and a higher degree of auditor judgment.

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◦ Tested management's identification of distinct performance obligations by evaluating whether the underlying goods, services, or both were capable of being distinct and distinct within the context of the contract.

◦ Tested the relative stand-alone selling prices by recalculating the stand-alone selling pricing of the performance obligations and evaluating the assumptions used by the Company to determine the standalone selling price for each distinct performance obligation.

◦ Tested the relative stand-alone selling prices by recalculating the stand-alone selling prices of the performance obligations and evaluating the assumptions used by the Company to determine the standalone selling price for each distinct performance obligation.

We evaluated the methodology used to determine the standalone selling price by comparison to historical analyses prepared by the Company and practices observed in the industry.

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We identified goodwill for the Company as a critical audit matter because of the significant judgments made by management to estimate the fair value of the reporting unit, specifically related to the selection of the discount rate and forecasts of future revenue.

Performing audit procedures to evaluate the reasonableness of management's estimates and assumptions related to selection of the

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discount rate and forecasts of future revenue required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

Performing audit procedures to evaluate the reasonableness of management's estimates and assumptions related to selection of the discount rate and forecasts of future revenue required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

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• We evaluated management's ability to accurately forecast revenue by comparing the actual results to management's historical projections from 2020.

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• We sensitized management projections to determine areas of audit focus.

• We evaluated the reasonableness of management's forecasted revenue by comparing the forecasts to:

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◦ Forecasted information included in analyst and industry reports for the Company and certain of its peer group.

◦ Public information related to addressable market opportunities.

• With the assistance of our fair value specialists, we evaluated the reasonableness of the (1) valuation methodology and (2) discount rates by:

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• We evaluated the impact of changes in management's revenue forecasts from the October 1, 2021 annual measurement date to December 31, 2021.

Preferred Stock – Accounting for preferred stock agreements in connection with investment transaction – Refer to Notes 2 and 5 to the financial statements

Critical Audit Matter Description

On January 7, 2021, the Company entered into separate Securities Purchase Agreements with each of Charter Communications Holding Company, LLC ("Charter"), Qurate Retail, Inc.

("Qurate") and Pine Investor, LLC ("Pine") (the "Securities Purchase Agreements").

The issuance of securities pursuant to the Securities Purchase Agreements (the "Transactions") and related matters were approved by the Company's stockholders on March 9, 2021 and completed on March 10, 2021.

At the closing of the Transactions, the Company issued and sold (a) to Charter, 27,509,203 shares of Series B Convertible Preferred Stock ("Preferred Stock") in exchange for $68.0 million, (b) to Qurate, 27,509,203 shares of Preferred Stock in exchange for $68.0 million and (c) to Pine, 27,509,203 shares of Preferred Stock in exchange for $68.0 million.

The shares were issued at par value of $0.001.

Net proceeds from the Transactions totaled $187.9 million after deducting issuance costs.

The Preferred Stock includes a change of control put option which allows the holders of the Preferred Stock to require the Company to repurchase such holders' shares in cash in an amount equal to the initial purchase price plus accrued dividends.

The change of control put option was determined to be a derivative liability under ASC 815, Derivatives and Hedging .

Additionally, all financial instruments that are classified as mezzanine equity are evaluated for embedded derivative features by evaluating each feature against the nature of the host instrument (e.g., more equity-like or debt-like).

Features identified as embedded derivatives that are material are recognized separately as a derivative asset or liability in the consolidated financial statements.

We identified the preferred stock transaction for the Company as a critical audit matter because auditing the appropriate accounting treatment for material preferred stock contracts required a complex accounting analysis, including considerations around embedded derivative features and the classification of financial instruments.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the preferred stock transaction included the following, among others:

• We tested the effectiveness of controls over management's evaluation of the preferred stock transaction.

• We read the preferred stock agreements and, with the assistance of professionals in our firm having expertise in the accounting for complex financial instruments, we analyzed the contracts to determine if all arrangement terms that may have an impact on accounting treatment were identified and independently evaluated management's accounting for the preferred stock agreements, including an evaluation of the embedded derivative features.

• We evaluated management's assessment related to the probability of a change of control.

• We tested the cash proceeds from the transaction.

• We analyzed and performed test of details over issuance costs, including the assessment of the proper accounting for such costs.

/s/ Deloitte & Touche LLP

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CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

As of December 31,

(In thousands, except share and per share data) 2021 2020

Current assets:

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Operating right-of-use assets 29,186 28,959

Goodwill 418,327 416,418

Intangible assets, net 52,340 79,559

Deferred tax assets 2,811 2,741

Intangible assets, net 39,945 52,340

Goodwill 435,711 418,327

Other non-current assets 10,263 7,600

Total assets $ 663,474 $ 677,970

Liabilities and Stockholders' Equity

Liabilities, Convertible Redeemable Preferred Stock and Stockholders' Equity

Current liabilities:

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Customer advances 11,613 12,477

Current portion of secured term note 12,644 —

Current operating lease liabilities 7,024 6,764

Warrants liability 10,520 2,831

Other current liabilities 5,750 7,393

Current operating lease liabilities 7,538 7,024

Secured term note — 12,644

Other current liabilities ($ 7,863 and $ — attributable to related parties, respectively)

Total current liabilities 165,371 184,275

Senior secured convertible notes (related party) 192,895 184,075

Financing derivatives (related party) 11,300 21,587

Non-current operating lease liabilities 36,055 36,127

Non-current contract liabilities 4,156 291

Non-current portion of accrued data costs ($ 7,843 attributable to related party)

Revolving line of credit 16,000 —

Deferred tax liabilities 2,103 627

Non-current portion of secured term note — 12,463

Senior secured convertible notes (related party) — 192,895

Financing derivatives (related party) — 11,300

Other non-current liabilities ($ 1,582 and $ 6,120 attributable to related parties, respectively)

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Commitments and contingencies

Convertible redeemable preferred stock, $ 0.001 par value;

82,527,609 and zero shares authorized, issued and outstanding as of December 31, 2021 and 2020, respectively;

aggregate liquidation preference of $ 211,863 as of December 31, 2021 (related parties)

Stockholders' equity:

Preferred stock, $ 0.001 par value per share;

5,000,000 shares authorized at December 31, 2020 and 2019;

Preferred stock, $ 0.001 par value;

7,472,391 and 5,000,000 shares authorized as of December 31, 2021 and 2020, respectively;

no shares issued or outstanding as of December 31, 2021 or 2020

Common stock, $ 0.001 par value per share;

150,000,000 shares authorized as of December 31, 2020 and 2019;

Common stock, $ 0.001 par value;

275,000,000 and 150,000,000 shares authorized as of December 31, 2021 and 2020, respectively;

97,172,086 shares issued and 90,407,290 shares outstanding as of December 31, 2021, and 79,703,342 shares issued and 72,938,546 shares outstanding as of December 31, 2020

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Accumulated deficit ( 1,218,715 ) ( 1,156,055 )

Treasury stock, at cost, and 6,764,796 shares as of December 31, 2020 and 2019

Treasury stock, at cost, 6,764,796 shares as of December 31, 2021 and 2020

( 229,984 ) ( 229,984 )

Total stockholders' equity 223,176 228,990

Total liabilities and stockholders' equity $ 677,970 $ 723,695

Total liabilities, convertible redeemable preferred stock and stockholders' equity $ 663,474 $ 677,970

See accompanying Notes to Consolidated Financial Statements.

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands, except share and per share data)

Years Ended December 31,

2020 2019 2018

(In thousands, except share and per share data) 2021 2020 2019

$ 367,013 $ 356,036 $ 388,645

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Restructuring (3)

— 3,263 11,837

Settlement of litigation, net — — 2,900

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Loss from operations ( 28,865 ) ( 21,275 ) ( 310,467 )

Loss on extinguishment of debt (2)

( 9,629 ) — —

Interest expense, net (2)

( 7,801 ) ( 35,805 ) ( 31,526 )

Other income (expense), net 14,554 1,654 ( 1,464 )

(Loss) gain from foreign currency transactions ( 4,490 ) 336 1,303

Other (expense) income, net ( 5,778 ) 14,554 1,654

Gain (loss) from foreign currency transactions 2,895 ( 4,490 ) 336

Loss before income taxes ( 49,178 ) ( 47,016 ) ( 340,003 )

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Net loss $ ( 50,037 ) $ ( 47,918 ) $ ( 338,996 )

Net loss available to common stockholders

Net loss $ ( 50,037 ) $ ( 47,918 ) $ ( 338,996 )

Convertible redeemable preferred stock dividends (2)

( 12,623 ) — —

Total net loss available to common stockholders $ ( 62,660 ) $ ( 47,918 ) $ ( 338,996 )

Net loss per common share:

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Net loss $ ( 50,037 ) $ ( 47,918 ) $ ( 338,996 )

Other comprehensive income (loss):

Other comprehensive (loss) income:

Foreign currency cumulative translation adjustment ( 5,068 ) 5,303 ( 1,712 )

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(1) Excludes amortization of intangible assets, which is presented separately in the Consolidated Statements of Operations and Comprehensive Loss.

(2) Transactions with related parties are included in the line items above as follows (refer to Footnote 13 , Related Party Transactions, of the Notes to Consolidated Financial Statements for additional information):

(2) Transactions with related parties are included in the line items above as follows (refer to Footnote 14 , Related Party Transactions , for further information):

Years Ended December 31,

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Cost of revenues 34,534 10,094 10,490

General and administrative 316 776 650

Interest expense, net ( 4,692 ) ( 24,480 ) ( 23,494 )

Loss on extinguishment of debt ( 9,608 ) — —

Convertible redeemable preferred stock dividends ( 12,623 ) — —

(3) Stock-based compensation expense is included in the line items above as follows:

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COMSCORE, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(In thousands, except share data)

Common Stock Additional

CONSOLIDATED STATEMENT OF CHANGES IN CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY

(In thousands, except share data) Convertible Redeemable Preferred Stock Common Stock Additional

Capital Accumulated

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Stockholders'

Shares Amount

Shares Amount Shares Amount

Balance as of December 31, 2018 — $ — 59,389,830 $ 59 $ 1,561,208 $ ( 10,621 ) $ ( 769,095 ) $ ( 229,984 ) $ 551,567

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Foreign currency translation adjustment — — — — — ( 1,712 ) — — ( 1,712 )

Subscription Receivable — — 10,254 — — — 10,254

Common Stock warrants issued — — 5,545 — — — 5,545

Issuance of Common Stock - CVI — — 2,728,513 3 8,159 — — — 8,162

Common Stock warrants exercised - Starboard (1)

— — 323,448 — — — — — —

Common Stock warrants exercised - CVI — — 2,728,513 3 5,482 — — — 5,485

Exercise of Common Stock options, net — — 68,259 — 1,191 — — — 1,191

Shares issued in connection with settlement of litigation 4,024,115 4 90,764 — — — 90,768

Repurchase of Common Stock in exchange for senior secured convertible notes ( 4,000,000 ) ( 7 ) — — — ( 94,014 ) ( 94,021 )

Interest paid in Common Stock (1)

— — 4,057,129 4 17,370 — — — 17,374

Restricted stock units vested — — 854,998 1 4,610 — — — 4,611

Payments for taxes related to net share settlement of equity awards — — ( 85,560 ) — ( 1,267 ) — — — ( 1,267 )

Stock-based compensation — — 33,520 — — — 33,520

Stock-based compensation expense — — — — 12,605 — — — 12,605

Balance as of December 31, 2019 — $ — 70,065,130 $ 70 $ 1,609,358 $ ( 12,333 ) $ ( 1,108,137 ) $ ( 229,984 ) $ 258,974

Adoption of ASC 842 — — — — ( 46 ) — ( 46 )

Net loss — — — — — — ( 47,918 ) — ( 47,918 )

Foreign currency translation adjustment — — — — — 5,303 — — 5,303

Issuance of Common Stock - CVI 2,728,513 3 8,159 — — — 8,162

Common Stock warrants exercised - Starboard 323,448 — — — — — —

Common Stock warrants exercised - CVI 2,728,513 3 5,482 — — — 5,485

Exercise of Common Stock options, net — — 75,000 — 143 — — — 143

Interest paid in Common Stock (1)

— — 1,474,201 2 3,058 — — — 3,060

Restricted stock units vested — — 1,363,152 1 3,064 — — — 3,065

Payments for taxes related to net share settlement of equity awards — — ( 38,937 ) — ( 117 ) — — — ( 117 )

Stock-based compensation — — 12,605 — — — 12,605

Stock-based compensation expense — — — — 6,480 — — — 6,480

Balance as of December 31, 2020 — $ — 72,938,546 $ 73 $ 1,621,986 $ ( 7,030 ) $ ( 1,156,055 ) $ ( 229,984 ) $ 228,990

Net loss — — — — — — ( 50,037 ) — ( 50,037 )

Foreign currency translation adjustment — — — 5,303 — — 5,303

Exercise of Common Stock options, net 75,000 — 143 — — — 143

Convertible redeemable preferred stock, net of issuance costs (1)

82,527,609 187,885 — — — — — — —

Fair value of Common Stock issued in connection with acquisition — — 7,945,519 8 25,766 — — — 25,774

Conversion shares issued as extinguishment cost on senior secured convertible notes (1)

— — 3,150,000 3 9,605 — — — 9,608

Interest paid in Common Stock (1)

— — 4,165,781 4 10,808 — — — 10,812

Convertible redeemable preferred stock dividends (1)

— — — — — — ( 12,623 ) — ( 12,623 )

Restricted stock units vested — — 2,362,963 2 7,117 — — — 7,119

Stock-based compensation expense — — — — 9,123 — — — 9,123

Foreign currency translation adjustment — — — — — ( 5,068 ) — — ( 5,068 )

Payments for taxes related to net share settlement of equity awards — — ( 155,519 ) — ( 522 ) — — — ( 522 )

Stock-based compensation — — 6,480 — — — 6,480

Balance as of December 31, 2021 82,527,609 $ 187,885 90,407,290 $ 90 $ 1,683,883 $ ( 12,098 ) $ ( 1,218,715 ) $ ( 229,984 ) $ 223,176

(1) Transactions for these line items were exclusively with related parties (refer to Foo tnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity , Footnot e 6 , Debt , and Footnote 14 , Related Party Transactions , of the Notes to Consolidated Financial Statements for additional information).

Gross proceeds from related parties for the issuance of convertible redeemable preferred stock were $ 204.0 million.

See accompanying Notes to Consolidated Financial Statements.

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CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

Years Ended December 31,

2020 2019 2018

(In thousands) 2021 2020 2019

Operating activities :

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Stock-based compensation expense 13,848 10,073 16,558

Non-cash interest expense on senior secured convertible notes (related party) 9,180 17,374 —

Accretion of debt discount 7,571 6,242 4,812

Loss on extinguishment of debt 9,629 — —

Change in fair value of warrant liability 7,689 ( 4,894 ) 2,411

Non-cash operating lease expense 5,345 5,555 5,369

Impairment of right-of-use and long-lived assets 4,671 — —

Provision for bad debts 1,693 727 966

Non-cash interest expense on senior secured convertible notes (1)

4,692 9,180 17,374

Amortization expense of finance leases 2,188 1,652 2,413

Accretion of debt discount 1,620 7,571 6,242

Amortization of deferred financing costs 378 1,560 1,078

Change in fair value of interest make-whole derivative 871 — —

Deferred tax provision (benefit) 10 ( 3,727 ) 2,019

Bad debt (benefit) expense ( 80 ) 1,693 727

Deferred tax (benefit) provision ( 1,719 ) 10 ( 3,727 )

Change in fair value of financing derivatives ( 1,800 ) ( 10,287 ) ( 5,100 )

Change in fair value of warrant liability ( 4,894 ) 2,411 —

Impairment of right-of-use and long-lived assets — 4,671 —

Impairment of goodwill — — 224,272

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Other 1,082 908 ( 2 )

Changes in operating assets and liabilities:

Changes in operating assets and liabilities, net of effect of acquisition:

Accounts receivable ( 2,081 ) 2,024 2,738

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Current operating lease liability ( 5,597 ) ( 6,327 ) ( 7,638 )

Insurance recoverable on litigation settlements — — 10,000

Net cash provided by (used in) operating activities 9,856 717 ( 4,636 )

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Purchases of property and equipment ( 803 ) ( 477 ) ( 2,736 )

Cash and restricted cash acquired from acquisition 902 — —

Proceeds from sale of investment in equity securities — — 3,776

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Financing activities :

Principal payment and extinguishment costs on senior secured convertible notes (1)

( 204,014 ) — —

Principal payment and extinguishment costs on secured term note ( 14,031 ) — —

Payments for dividends on convertible redeemable preferred stock (1)

( 4,760 ) — —

Principal payments on finance leases ( 2,138 ) ( 1,754 ) ( 2,535 )

Principal payments on capital lease and software license arrangements ( 367 ) ( 2,070 ) ( 9,006 )

Payments for taxes related to net share settlement of equity awards ( 522 ) ( 117 ) ( 1,267 )

Principal payments on capital lease and software license arrangements ( 329 ) ( 367 ) ( 2,070 )

Proceeds from the exercise of stock options — 142 1,191

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Proceeds from secured term note — — 13,000

Secured term note issuance costs — ( 350 ) —

Proceeds from sale-leaseback financing transaction — — 4,252

Proceeds from borrowings on senior secured convertible notes (related party) — — 100,000

Senior secured convertible notes issuance costs — — ( 5,146 )

Financing proceeds received on subscription receivable (related party) — — 9,679

Proceeds from borrowings on revolving line of credit 16,000 — —

Proceeds from issuance of convertible redeemable preferred stock, net of issuance costs (1)

Other ( 543 ) — ( 350 )

Net cash (used in) provided by financing activities ( 22,452 ) ( 2,096 ) 31,973

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Supplemental cash flow disclosures :

Interest paid ($ 21,420 , $ 3,046 and $ 7,484 of interest paid in 2020, 2019, and 2018 attributable to related party, respectively)

Interest paid ($ — , $ 21,420 and $ 3,046 in 2021, 2020, and 2019 attributable to related party, respectively)

$ 1,009 $ 23,792 $ 4,081

Income taxes paid, net of refunds 1,831 1,182 1,191

Operating cash flows from operating leases 9,623 11,170 15,546

Operating cash flows from finance leases 440 493 471

Supplemental non-cash activities :

Fair value of Common Stock issued in connection with acquisition $ 25,774 $ — $ —

Interest paid in Common Stock (1)

Conversion shares issued as extinguishment cost on senior secured convertible notes (1)

Convertible redeemable preferred stock dividends accrued but not yet paid (1)

Settlement of restricted stock unit liability 7,117 3,065 4,611

Assets acquired through finance leases and software obligations 1,109 4,277 1,737

Change in accounts payable and accrued expenses related to capital expenditures 395 456 1,149

Fair value of contingent consideration recognized upon closing of acquisition 5,600 — —

Right-of-use assets obtained in exchange for operating lease liabilities 5,211 669 397

Right-of-use assets obtained in exchange for finance lease liabilities 3,345 754 4,049

Leasehold improvements acquired through lease incentives — 394 2,050

Fair value of warrants issued in private placement — — 10,798

Repurchase of Common Stock in exchange for senior secured convertible notes — — 94,021

Shares issued in connection with settlement of litigation — — 90,768

Insurance recovery on litigation settlement — — 27,232

Fair value of financing derivatives issued with senior secured convertible notes — — 17,574

Common Stock warrants issued with senior secured convertible notes — — 5,733

Notes Option derivative liability settlement — — 5,700

Modification of debt in consideration for the reduction of the senior secured convertible note minimum cash balance requirement — — 4,000

(1) Transactions for these line items were exclusively with related parties (refer to Footnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity , Footnot e 6 , Debt , and Footnote 14 , Related Party Transactions , of the Notes to Consolidated Financial Statements for additional information).

Gross proceeds from related parties for the issuance of convertible redeemable preferred stock were $ 204.0 million.

See accompanying Notes to Consolidated Financial Statements.

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comScore, Inc., together with its consolidated subsidiaries (collectively, "Comscore" or the "Company"), headquartered in Reston, Virginia, is a global information and analytics company that measures audiences, consumer behavior and advertising across media platforms.

On December 16, 2021, the Company and two newly formed, wholly owned subsidiaries of the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") with Shareablee, Inc.

("Shareablee"), to acquire Shareablee in exchange for shares of the Company's Common Stock and contingent consideration payable subject to the achievement of certain conditions set forth in the Merger Agreement.

Refer to Footno t e 3 , Business Combination.

Operating segments are defined as components of a business that can earn revenues and incur expenses for which discrete financial information is available that is evaluated on a regular basis by the chief operating decision maker ("CODM").

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The Company's CODM reviews consolidated results of operations to make decisions, allocate resources and assess performance and does not evaluate the profit or loss from any separate geography or product line.

Uses and Sources of Liquidity and Management's Plans

The Company's primary need for liquidity is to fund working capital requirements and capital expenditures of its business.

Since 2017, the Company has implemented certain organizational restructuring plans to reduce staffing levels, exit certain geographic regions, and rationalize its leased properties, to enable the Company to decrease its global costs, more effectively align resources to business priorities, and maintain compliance with its financial covenants, as described in Footnote 4 , Debt .

The Company has secured the following long-term financing in order to increase its available working capital and fund ongoing operations:

• During 2018, the Company entered into certain agreements with funds affiliated with or managed by Starboard Value LP (collectively, "Starboard"), pursuant to which the Company issued and sold to Starboard a total of $ 204.0 million in senior secured convertible notes (the "Notes") as well as warrants to purchase shares of the Company's common stock, par value $ 0.001 per share (the "Common Stock") in exchange for $ 100.0 million in cash and 4,000,000 shares of Common Stock.

For additional information, refer to Footnote 4 , Debt .

• On June 26, 2019, the Company issued 2,728,513 shares of Common Stock and four series of warrants in a private placement to CVI Investments, Inc.

("CVI") in exchange for gross cash proceeds of $ 20.0 million.

On October 14, 2019, the Company issued 2,728,513 shares of Common Stock to CVI upon exercise by CVI of the Series C warrant.

For additional information, refer to Footnote 5 , Stockholders' Equity.

• On December 31, 2019, the Company's wholly owned subsidiary, Rentrak B.V., entered into an agreement with several third parties (collectively the "Noteholder") for a secured promissory note (the "Secured Term Note") in exchange for gross proceeds of $ 13.0 million.

The Secured Term Note matures on December 31, 2021, is cash collateralized, and has an annual interest rate of 9.75 % that is payable monthly in arrears.

For additional information, refer to Footnote 4 , Debt .

As of December 31, 2020, the Company was in compliance with its covenants under the Notes and the Secured Term Note.

On January 7, 2021, the Company entered into separate Securities Purchase Agreements with each of Charter Communications Holding Company, LLC ("Charter"), Qurate Retail, Inc.

("Qurate") and Pine Investor, LLC ("Pine"), pursuant to which, at the closing of the transactions contemplated thereby (the "Transactions"), the Company will issue and sell (a) to Charter, 27,509,203 shares of Series B Convertible Preferred Stock in exchange for $ 68.0 million, (b) to Qurate, 27,509,203 shares of Series B Convertible Preferred Stock in exchange for $ 68.0 million and (c) to Pine, 27,509,203 shares of Series B Convertible Preferred Stock in exchange for $ 68.0 million.

The proceeds of the Transactions will be used to repay the Notes issued to Starboard.

Additionally, in connection with the closing, the Company expects to repay the Secured Term Note and certain transaction-related expenses with cash from its balance sheet.

The Transactions and related matters were approved by the Company's stockholders on March 9, 2021 and are expected to be completed on or around March 10, 2021.

Repayment of the Notes and the Secured Term Note will result in the termination of the affirmative and negative covenants set forth in these instruments, including the Notes covenant requiring maintenance of certain minimum cash balances (currently $ 40.0 million), and is expected to improve the Company's financial position and liquidity.

As a result, the Company believes the approved Transactions will provide it with adequate sources of funding to satisfy its estimated liquidity needs for at least one year after the date that these financial statements are issued.

However, the Company cannot predict with certainty the outcome of its actions to generate liquidity or whether such actions would generate the expected liquidity as currently planned.

Table of Conte nt s

Summary of Significant Accounting Policies

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Certain amounts in the prior year financial statements have been reclassified to conform to the current year presentation.

Specifically, current accrued litigation settlements have been aggregated within other current liabilities on the Consolidated Balance Sheets.

In addition, non-current contract liabilities are now separately reported from other non-current liabilities on the Consolidated Balance Sheets.

Specifically, non-current contract liabilities have been aggregated within other non-current liabilities on the Consolidated Balance Sheets.

Use of Estimates and Judgments in the Preparation of the Consolidated Financial Statements

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Significant estimates and judgments are inherent in the analysis and the measurement of:

management's standalone selling price ("SSP"), principal versus agent revenue recognition, determination of performance obligations, determination of transaction price, including the determination of variable consideration and allocation of transaction price to performance obligations, deferred tax assets and liabilities, including the identification and quantification of income tax liabilities due to uncertain tax positions, the valuation and recoverability of goodwill and intangible assets, the determination of appropriate discount rates for lease accounting, the probability of exercising either lease renewal or termination clauses, the assessment of potential loss from contingencies, the fair value determination of financing-related liabilities and warrants, the allowance for doubtful accounts, and the valuation of options, performance-based and market-based stock awards.

management's standalone selling price ("SSP"), principal versus agent revenue recognition, determination of performance obligations, determination of transaction price, including the determination of variable consideration and allocation of transaction price to performance obligations, deferred tax assets and liabilities, including the identification and quantification of income tax liabilities due to uncertain tax positions, the valuation and recoverability of goodwill and intangible assets, the determination of appropriate discount rates for lease accounting, the probability of exercising either lease renewal or termination clauses, the assessment of potential loss from contingencies, the fair value determination of contingent consideration from business combinations, financing-related liabilities and warrants, and the valuation of options, performance-based and market-based stock awards.

Management bases its estimates and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances.

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The Company's assessment of the significance of a particular input to the fair value measurements requires judgment and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy.

For assets that are measured using quoted prices in active markets, the total fair value is the published market price per unit multiplied by the number of units held, without consideration of transaction costs.

Assets and liabilities that are measured using significant other observable inputs are primarily valued by reference to quoted prices of similar assets or liabilities in active markets, adjusted for any terms specific to that asset or liability.

Assets and liabilities that are measured at fair value on a non-recurring basis include property and equipment, operating right-of-use assets, intangible assets and goodwill.

The Company recognizes these items at fair value when they are considered to be impaired or upon initial recognition.

The fair value of these assets and liabilities are determined with valuation techniques using the best information available and may include quoted market prices, market comparables and discounted cash flow models.

Fair Value of Financial Instruments

Due to their short-term nature, the carrying amounts reported in the Company's Consolidated Financial Statements approximate the fair value for cash and cash equivalents, restricted cash including certificates of deposit, accounts receivable, accounts payable and accrued expenses, the current portion of contract liability and customer advances.

The carrying values of finance lease obligations approximate their fair value as the interest rates for the lease term approximate market rates (Level 2).

Assets that are measured at fair value on a non-recurring basis include property and equipment, operating right-of-use assets, intangible assets and goodwill.

The Company measures these items at fair value when they are considered to be impaired or, in certain cases, upon initial

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The fair values of the Company's financing derivatives are estimated using forward projections and are discounted back at rates commensurate with the remaining term of the related derivatives.

The fair value of the interest reset liability is determined based on an estimate for the Company's credit rating, the premium attributable to the payment-in-kind feature of the Notes, and premium estimates for company-specific risk factors (together, the credit adjusted discount rate), the Company's Common Stock price at measurement date, the observable volatility of the Common Stock and risk-free rate.

The fair value of the change in control redemption derivative liabilities is determined based on the probability of change of control, credit adjusted discount rate, and risk-free rate.

The fair value of the Notes is determined using the credit adjusted discount rate, the Company's Common Stock price at the valuation date, risk-free rate and volatility commensurate with the remaining term of the Notes.

The fair value of the Company's Secured Term Note is determined using future cash flows that are discounted back at a risk-free rate commensurate with the expected remaining term of the debt.

The fair value of the Company's interest make-whole derivative is estimated using forward projections of estimated cash payments at the closing date discounted back to the valuation date at rates commensurate with the estimated remaining term of the related derivative.

Cash and Cash Equivalents

The Company considers highly liquid investments with an original maturity of three months or less at the time of purchase and qualifying money-market funds as cash equivalents.

The fair value of these assets are determined with valuation techniques using the best information available and may include market comparable information, discounted cash flow models, or a combination thereof.

The carrying amounts of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses, and the current portion of contract liabilities and customer advances reported in the Consolidated Balance Sheets approximate fair value due to the short-term nature of these instruments.

The carrying amount of the revolving line of credit approximates fair value due to the variable rate nature of the debt.

Preferred Stock

In 2021, the Company issued shares of Series B Convertible Preferred Stock ("Preferred Stock") as described in Footnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity .

The change of control put option was determined to be a derivative liability.

As of December 31, 2021, the probability of a change of control was determined to be remote, and the fair value of the change of control derivative was determined to be negligible.

The Preferred Stock is contingently redeemable upon certain deemed liquidation events, such as a change in control.

Because a deemed liquidation event could constitute a redemption event outside of the Company's control, all shares of Preferred Stock have been presented outside of permanent equity in mezzanine equity on the Consolidated Balance Sheets.

The instrument is initially recognized at fair value net of issuance costs.

The Company reassesses whether the Preferred Stock is currently redeemable, or probable to become redeemable in the future, as of each reporting date.

If the instrument meets either of these criteria, the Company will accrete the carrying value to the redemption value.

The Preferred Stock has not been adjusted to its redemption amount as of December 31, 2021 because a deemed liquidation event is not considered probable.

All financial instruments that are classified as mezzanine equity are evaluated for embedded derivative features by evaluating each feature against the nature of the host instrument (for example, more equity-like or debt-like).

Features identified as embedded derivatives that are material are recognized separately as a derivative asset or liability in the financial statements.

Effective January 1, 2021, the Company early adopted Accounting Standards Update ("ASU") 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815-40).

This ASU simplifies accounting for convertible instruments, enhances disclosure requirements related to the terms and features of convertible instruments, and amends the guidance for the derivatives scope exception for contracts settled in an entity's own equity.

This ASU removes from GAAP the separation models for (1) convertible debt with a Cash Conversion Feature and (2) convertible instruments with a Beneficial Conversion Feature.

Upon adoption of this new ASU, entities will account for a convertible debt instrument wholly as debt, and for convertible preferred stock wholly as preferred stock, unless (1) a convertible instrument contains features that require bifurcation as a derivative, or (2) a convertible debt instrument was issued at a substantial premium.

As a result of the adoption, no embedded features were identified requiring bifurcation under the new model, other than the change of control redemption feature.

The Company adopted the standard using the modified retrospective approach.

The standard had no impact on the senior secured convertible notes (the "Notes") issued by the Company prior to adoption and, as a result, there was no cumulative adjustment recorded upon adoption.

Loss on Extinguishment of Debt

In 2021, the Company recorded a $ 9.6 million loss on debt extinguishment related to the payoff of the Notes and a foreign secured promissory note (the "Secured Term Note").

Loss on extinguishment of debt represents the difference between the carrying value of the Company's debt instruments and any consideration paid to its creditors in the form of cash or shares of the Company's Common Stock on the extinguishment date.

These transactions are described in Footnote 6 , Debt .

Financing Derivatives

The Company's derivative financial instruments are not hedges and do not qualify for hedge accounting.

Changes in the fair value of these instruments are recorded in other (expense) income, net in the Consolidated Statements of Operations and Comprehensive Loss.

The fair values of the financing derivatives were estimated using forward projections and were discounted back at rates commensurate with the remaining term of the related derivatives.

Significant valuation inputs included the Company's credit rating, the premium attributable to the payment-in-kind feature of the Notes, and premium estimates for company-specific risk factors (together, the "credit-adjusted discount rate"), the price and expected volatility of the Company's Common Stock, probability of change of control, and forward projections of estimated cash payments.

Extinguishment of the Notes on March 10, 2021 resulted in derecognition of the remaining financing derivatives.

Refer to Footnote 6 , Debt for additional information.

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Cash, Cash Equivalents and Restricted Cash

Cash and cash equivalents are maintained with several financial institutions domestically and internationally.

The combined account balances held on deposit at each institution typically exceed Federal Deposit Insurance Corporation ("FDIC") insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage.

The Company monitors this credit risk and makes adjustments to the concentrations as necessary.

Restricted Cash

Restricted cash represents the Company's cash collateral requirements under the Secured Term Note, outstanding letters of credit, and corporate credit card obligations.

As of December 31, 2020 and 2019, the Company had $ 19.6 million and $ 20.2 million of restricted cash, respectively, of which $ 0.5 million and $ 1.0 million was held in certificates of deposit as of December 31, 2020 and 2019, respectively.

As of December 31, 2020, certificates of deposit in the amount of $ 0.1 million will mature within one year.

The Company reduces this risk by maintaining such deposits with high quality financial institutions that management believes are creditworthy, and by monitoring this credit risk and making adjustments as necessary.

The Company considers highly liquid investments with an original maturity of three months or less at the time of purchase and qualifying money-market funds as cash equivalents.

As of December 31, 2021, restricted cash represents security deposits for subleased office space.

As of December 31, 2020, restricted cash primarily represents the Company's requirement to collateralize the Secured Term Note and outstanding letters of credit.

Allowance for Doubtful Accounts

The Company generally grants uncollateralized credit terms to its customers and maintains an allowance for doubtful accounts to reserve for uncollectible receivables.

The Company generally grants uncollateralized credit terms to its customers.

Credit risk associated with accounts receivable is mitigated by the Company's ongoing credit evaluation of its customers' financial condition.

An allowance for doubtful accounts is maintained to reserve for uncollectible receivables.

Allowances are based on management's judgment, which considers historical collection experience adjusted for current conditions or expected future conditions based on reasonable and supportable forecasts, a specific review of all significant outstanding receivables, an assessment of company-specific credit conditions and general economic conditions.

For 2020, management considered the impact of the COVID-19 pandemic, including customer payment delays and requests from customers to revise contractual payment terms, in determining the Company's allowance for doubtful accounts which resulted in an increase of the allowance.

The following is a summary of the allowance for doubtful accounts:

Management considered the impact of the COVID-19 pandemic, including customer payment delays and requests from customers to revise contractual payment terms, in determining the Company's allowance for doubtful accounts.

The following is a summary of the activity within the allowance for doubtful accounts:

Years Ended December 31,

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Beginning Balance $ ( 2,757 ) $ ( 1,919 ) $ ( 1,597 )

Bad debt expense ( 1,693 ) ( 727 )

Bad debt benefit (expense) 80 ( 1,693 ) ( 727 )

Recoveries ( 161 ) ( 300 ) ( 481 )

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Property and equipment is recorded at cost, net of accumulated depreciation, and is depreciated on a straight-line basis over the estimated useful lives of the assets, ranging from 3 to 5 years.

Assets under finance leases are recorded at their net present value at the commencement of the lease.

Assets under finance leases and leasehold improvements are amortized over the shorter of the related lease terms or their useful lives.

Finance lease assets are recorded at their net present value at the commencement of the lease.

Both finance lease assets and leasehold improvements are amortized on a straight-line basis over the shorter of the related lease terms or their useful lives.

Replacements and major improvements are capitalized;

maintenance and repairs are expensed as incurred.

Capitalized Software

Capitalized software, which is included in property and equipment, net, consists of costs to purchase and develop internal-use software, which the Company uses to provide services to its clients.

Included in property and equipment, net, are capitalized software costs to purchase and develop internal-use software, which the Company uses to provide services to its clients.

The costs to purchase and develop internal-use software are capitalized from the time that the preliminary project stage is completed, and it is considered probable that the software will be used to perform the function intended, until the time the software is placed in service for its intended use.

Any costs incurred during subsequent efforts to upgrade and enhance the functionality of the software are also capitalized.

Once this software is ready for use in

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the Company's products, these costs are amortized on a straight-line basis over the estimated useful life of the software, which is typically assessed to be 3 to 5 years.

During the years ended December 31, 2020, 2019 and 2018 the Company capitalized $ 15.0 million, $ 11.9 million, and $ 9.6 million in internal-use software costs, respectively.

Once this software is ready for use in the Company's products, these costs are amortized on a straight-line basis over the estimated useful life of the software, which is typically assessed to be 3 to 5 years.

During the years ended December 31, 2021, 2020 and 2019, the Company capitalized $ 18.9 million (including $ 4.6 million recorded as part of the acquisition of Shareablee), $ 15.0 million, and $ 11.9 million in internal-use software costs, respectively.

The Company depreciated $ 12.8 million, $ 9.1 million and $ 4.8 million in capitalized internal-use software costs during the years ended December 31, 2021, 2020 and 2019, respectively.

Certain costs incurred for implementation, setup, and other upfront activities in a hosting arrangement that is a service contract are capitalized within other non-current assets in the Consolidated Balance Sheets.

Once the implementation has been completed, the capitalized amounts are amortized on a straight-line basis over the remaining noncancelable term of the hosting arrangement, including options to extend the hosting arrangement when it is reasonably certain the options will be exercised.

The Company capitalized $ 3.2 million and $ 1.0 million of implementation costs during the years ended December 31, 2020 and 2019.

Amortization of these costs has not commenced as the implementation activities are not complete.

Business Combination

In 2021, the Company acquired Shareablee as described in Footnote 3 , Business Combination .

The purchase consideration was allocated to all tangible and intangible assets acquired, and liabilities assumed, based upon their acquisition-date fair values.

Contract assets and liabilities were measured in accordance with revenue recognition principles.

Any excess purchase consideration was recorded as goodwill.

Acquisition-related costs were expensed as incurred.

Definite-lived intangible assets were recognized for acquired methodologies and technology, as well as customer relationships.

The fair value of the acquired methodologies and technology was estimated using the multi-period excess earnings method of the income approach.

This technique is based on projected financial information for the useful life of the asset, adjusted for technological obsolescence rates and a contributory asset charge, to determine the cash flows attributable to the asset.

These cash flows are then discounted back to the acquisition date using an appropriate rate of return.

The selected discount rate was 26.0 %.

The fair value of the customer relationships was estimated using a "with and without" method of the income approach.

This technique compares the cash flows from the existing customer relationship revenues

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to cash flows in a scenario where the Company would have to re-create those customer relationship revenues using cash from its business.

These cash flows are then discounted back to the acquisition date using an appropriate rate of return.

The selected discount rate was 24.0 %.

A component of the purchase consideration is payable contingent on the achievement of certain contractual milestones or future revenue performance.

This contingent consideration is classified as a liability due to the fact it will be settled in cash or a variable number of shares (or a combination thereof), and the amount of the payment is not dependent upon the fair value of the Company's Common Stock.

The fair value of the contingent consideration liability is estimated using a combination of valuation techniques.

The primary technique is an option pricing model within a Monte Carlo simulation that determines an average projected payment value across numerous iterations.

This technique determines projected payments based on simulated revenues derived from an internal forecast, adjusted for a selected revenue volatility and risk premium based on market data for comparable guideline public companies.

The secondary technique is a discounted cash flow model that assumes achievement of the contractual milestones, resulting in payment of the full deferred amount.

In both techniques, the projected payments are then discounted back to the valuation date at the Company's cost of debt using a term commensurate with the contractual payment dates.

The contingent consideration liability will be measured at fair value on a recurring basis until the contingency is resolved.

Changes in the estimated fair value of the contingent consideration liability will be reflected in operating income or expense in the Consolidated Statements of Operations and Comprehensive Loss, and could have a material impact on our operating results.

Cloud Computing Implementation Costs

Certain costs incurred for implementation, setup, and other upfront activities in a hosting arrangement that is a service contract are capitalized during the application development stage.

Upgrades and enhancements are capitalized if they will result in additional functionality.

Amortization of capitalized costs is recorded on a straight-line basis over the term of the associated hosting arrangement, inclusive of reasonably certain renewal periods.

During the third quarter of 2021, the Company completed its implementation of a new cloud-based Enterprise Resource Planning ("ERP") system.

The Company capitalized $ 6.8 million of eligible implementation costs in connection with its development and testing of the ERP system.

These capitalized implementation costs are classified within other non-current assets in the Consolidated Balance Sheets.

As of December 31, 2021, 2020 and 2019, capitalized implementation costs, net of accumulated amortization, were $ 6.4 million, $ 3.2 million, and $ 1.0 million, respectively.

The Company determined the expected period of benefit of the capitalized implementation costs was five years .

Amortization costs are classified within general and administrative expense in the Consolidated Statements of Operations and Comprehensive Loss.

The Company recorded $ 0.7 million of amortization expense for the year ended December 31, 2021.

Goodwill and Intangible Assets

Goodwill represents the excess of the purchase price over the fair value of identifiable assets acquired and liabilities assumed when a business is acquired.

Goodwill represents the excess of the purchase consideration over the fair value of identifiable assets acquired and liabilities assumed when a business is acquired.

The valuation of intangible assets and goodwill involves the use of management's estimates and assumptions and can have a significant impact on future operating results.

The Company initially records its intangible assets at fair value.

Intangible assets with finite lives are amortized over their estimated useful lives while goodwill is not amortized but is evaluated for impairment at least annually, as of October 1, by comparing the fair value of a reporting unit to its carrying value including goodwill recorded by the reporting unit.

Definite-lived intangible assets are amortized over their estimated useful lives while goodwill is not amortized but is evaluated for impairment at least annually, as of October 1, by comparing the fair value of a reporting unit to its carrying value including goodwill recorded by the reporting unit.

The Company has a single reporting unit.

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The Company monitors for events and circumstances that could negatively impact the key assumptions in determining fair value, including long-term growth projections, profitability, discount rates, volatility in the Company's market capitalization, general industry, and market and macro-economic conditions.

It is possible that future changes in such circumstances, or in the variables associated with the judgments, assumptions and estimates used in assessing the fair value of the reporting unit, would require the Company to record a non-cash impairment charge.

The Company completed its annual assessment on October 1, 2021, and there was no impairment of goodwill at the assessment date.

No goodwill impairment charges were recognized during the years ended December 31, 2021 and 2020.

The Company performed an interim analysis as of June 30, 2019, and determined that goodwill was then impaired.

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The Company completed its annual assessment on October 1, 2019, and there was no additional impairment of goodwill at the assessment date.

No goodwill impairment charges were recognized during the year ended December 31, 2018.

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Intangible assets with finite lives are generally amortized using the straight-line method over the following useful lives:

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Trade Names 2 to 6

Impairment of Right-of-use and Long-Lived Assets

The Company's long-lived assets consist of property and equipment and finite-lived intangible assets.

The Company evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate the carrying value of such assets may not be recoverable.

The Company evaluates its definite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying value of such assets may not be recoverable.

If an indication of impairment is present, the Company compares the estimated undiscounted future cash flows to be generated by the asset group to its carrying amount.

Recoverability measurement and estimation of undiscounted cash flows are

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grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities.

Recoverability measurement and estimation of undiscounted cash flows are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities.

If the undiscounted future cash flows are less than the carrying amount of the asset group, the Company records an impairment loss equal to the excess of the asset group's carrying amount over its fair value.

The fair value is determined based on valuation techniques such as a comparison to fair values of similar assets or using a discounted cash flow analysis.

Although the Company believes that the carrying values of its long-lived assets are appropriately stated, changes in strategy or market conditions, significant technological developments or significant changes in legal or regulatory factors could significantly impact these judgments and require adjustments to recorded asset balances.

The Company performed an interim analysis as of June 30, 2019, as events or changes in circumstances indicated the carrying value of certain assets may not be recoverable, and determined that the Company's strategic alliance (the "strategic alliance") with WPP plc and its affiliates ("WPP") was impaired.

The Company performed an interim analysis as of June 30, 2019, as events or changes in circumstances indicated the carrying value of certain intangible assets may not be recoverable, and determined that the Company's strategic alliance (the "strategic alliance") with WPP plc and its affiliates ("WPP") was impaired.

Refer to Footnote 10 , Goodwill and Intangible Assets for further information.

The Company applies the provisions of Accounting Standards Codification ("ASC") 360, Property, Plant and Equipment , to determine whether right-of-use ("ROU") assets and related long-lived assets may be impaired.

Although the Company believes that the carrying values of its goodwill and definite-lived intangible assets are appropriately stated as of December 31, 2021, changes in strategy or market conditions, significant technological developments or significant changes in legal or regulatory factors could significantly impact these judgments and require adjustments to recorded asset balances.

Recoverability of Other Long-Lived Assets

The Company's other long-lived assets consist primarily of property and equipment and right-of-use ("ROU") assets.

The Company evaluates its ROU and long-lived assets for impairment whenever events or changes in circumstances indicate the carrying value of such assets may not be recoverable.

For facility lease ROU and related long-lived assets, the Company compares the estimated undiscounted cash flows generated by a sublease to the current carrying value of the ROU and related long-lived assets.

If the undiscounted cash flows are less than the carrying value of the ROU and related long-lived assets, the Company records an impairment loss equal to the excess of the ROU and long-lived assets' carrying value over their fair value consistent with other long-lived assets.

The Company treats operating lease ROU assets as financing transactions, thereby excluding the operating lease liability and related lease payments from the head lease, for purposes of testing recoverability.

The Company performed an interim analysis as of March 31, 2020, as changes in market conditions indicated the carrying value of certain facility lease ROU and other long-lived assets may not be recoverable, and determined that certain ROU assets, and related leasehold improvements, were impaired.

The Company recorded a $ 4.7 million non-cash impairment charge related to its ROU assets, and related leasehold improvements, with corresponding reductions of $ 2.8 million and $ 1.9 million to the operating right-of-use assets and property and equipment, net line items, respectively, in the Consolidated Balance Sheet.

The Company recorded a $ 4.7 million non-cash impairment charge related to its ROU assets and related leasehold improvements.

The impairment charge was driven by changes in the Company's projected undiscounted cash flows for certain properties, primarily as a result of changes in the real estate market related to the COVID-19 pandemic, that led to an increase in the estimated marketing time, and a reduction of expected receipts, for properties on the market for sublease.

The fair value of these ROU assets, and related leasehold improvements, was estimated using an income approach and a discount rate of 12.0 %.

Although the Company believes that the carrying values of its long-lived assets are appropriately stated as of December 31, 2020, future changes in strategy or market conditions, significant technological developments or significant changes in legal or regulatory factors could significantly impact these judgments and require adjustments to recorded asset balances.

Accounting for Warrants

In 2019, the Company issued warrants to CVI in connection with the private placement described in Footnote 1 , Organization .

The warrants were determined to be freestanding financial instruments that qualify for liability treatment as a result of a net cash settlement feature associated with a cap on the issuance of shares under certain circumstances.

Changes in the fair value of these instruments are immediately recorded in other income (expense), net in the Consolidated Statements of Operations and Comprehensive Loss.

The fair value of the warrants is determined using a Monte Carlo simulation analysis within an option pricing model.

The fair value estimate is determined using an estimate for the Company's cost of debt, probability of change of control, dividend yield, risk-free rate, remaining term of the warrants and volatility.

The fair values of the warrants are estimated using forward projections of stock issuances with relative certainty and estimated payments at each exercise date discounted back to the valuation date with the remaining term of the related warrants.

The primary sensitivity in the valuation of each warrant liability is driven by the Common Stock price at the measurement date and the observable volatility of the Common Stock.

Equity Securities

The Company sold its remaining investment in equity securities during 2019 for gross cash proceeds of $ 3.8 million.

Changes in the investment's fair value were reported in other income (expense), net as they occurred;

therefore, the sale of this investment did not result in a gain or loss in the Consolidated Statements of Operations and Comprehensive Loss.

The Company adopted ASC 842, Leases , with an initial application date of January 1, 2019, using the modified retrospective method with optional transaction relief, under which the Company did not restate prior comparative periods and instead recorded an adjustment to stockholders' equity as of the date of initial implementation for the cumulative impact of adoption.

The adoption of ASC 842 did not have a material impact on the Consolidated Statements of Operations and Comprehensive Loss.

Although the Company believes that the carrying values of its other long-lived assets are appropriately stated as of December 31, 2021, changes in strategy or market conditions, significant technological developments or significant changes in legal or regulatory factors could significantly impact these judgments and require adjustments to recorded asset balances.

Warrants Liability

In 2019, the Company issued warrants to CVI in connection with the private placement described in Footnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity .

The warrants were determined to be freestanding financial instruments that qualify for liability treatment as a result of net cash settlement features associated with a cap on the issuance of shares, under certain circumstances, or upon a change of control.

Changes in the fair value of these instruments are recorded in other (expense) income, net in the Consolidated Statements of Operations and Comprehensive Loss.

The fair value of each warrant is estimated utilizing an option pricing model supplemented with a Monte Carlo simulation in periods with multiple warrants outstanding where certain features resulted in additional valuation complexity.

Significant valuation inputs include the price and expected volatility of the Company's Common Stock, cost of debt, risk-free rate, remaining term of the warrants, and probability of change of control.

In situations where a change of control was assumed, the fair values of the warrants are based on estimated cash payments at each payment date discounted back to the valuation date using the cost of debt.

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The Company's lease portfolio is comprised of two major classes.

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Computer equipment leases are generally accounted for as finance leases.

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The Company determines if an arrangement is a lease at inception by evaluating whether the arrangement conveys the right to use an identified asset and whether the Company obtains substantially all of the economic benefits from and has the ability to direct the use of the asset.

The Company determines if an arrangement is or contains a lease at inception and whether the lease should be classified as an operating or finance lease.

ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of the future minimum lease payments over the lease term.

Operating ROU assets also include the impact of any lease incentives.

For any leases in which an asset is not specifically identified, the Company performs a discrete analysis to identify whether there is an implicitly identified asset based on the contractual or other known requirements, such as the presence of substantive substitution rights on the part of the supplier or the right of the Company to sublease the asset.

As part of this analysis, the Company also determines whether there are any restrictions on the use of the asset placed on the Company that are not considered protective rights on the part of the supplier and thus would allow the Company to assume which specific assets have been identified.

The Company identifies separate lease and non-lease components within the contract.

Non-lease components primarily include payments for common-area maintenance and management charges.

The Company has elected to combine lease and non-lease payments and account for them together as a single lease component, which increases the amount of the Company's ROU assets and lease liabilities.

The interest rate used to determine the present value of the future lease payments is the Company's incremental borrowing rate, because the interest rate implicit in the Company's leases is not readily determinable.

An ROU asset and lease liability are not recorded for short-term leases with an initial term of 12 months of less.

The Company has elected to combine lease and non-lease payments and account for them together as a single lease component, which increases the carrying amount of the ROU assets and lease liabilities.

Non-lease components primarily include payments for common-area maintenance, utilities and other pass-through charges.

The Company uses its incremental borrowing rate to determine the present value of the future lease payments.

The incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located.

The Company's current discount rates range from 10.6 % to 15.0 % depending on the term of the lease.

The Company's lease terms include periods under options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

The Company considers contractual-based factors such as the nature and terms of the renewal or termination, asset-based factors such as physical location of the asset and entity-based factors such as the importance of the leased asset to the Company's operations to determine the lease term.

The Company generally uses the base, non-cancelable, lease term when determining the ROU assets and lease liabilities.

The Company generally uses the non-cancelable lease term when measuring its ROU assets and lease liabilities.

Payments under the Company's lease arrangements are primarily fixed;

however, certain lease agreements contain variable payments, which are expensed as incurred and not included in the measurement of ROU assets and lease liabilities.

These amounts include payments affected by changes in the Consumer Price Index and payments for common-area maintenance, real estate taxes and utilities, which are based on usage or performance.

however, certain lease agreements contain variable payments, which are expensed as incurred and excluded from the measurement of ROU assets and lease liabilities.

These payment amounts are affected by changes in market indices and costs for common-area maintenance, utilities and other pass-through charges that are based on usage or performance.

Operating leases are included in operating ROU assets, current operating lease liability, and non-current operating lease liability in the Consolidated Balance Sheets.

The Company recognizes lease expense for its operating leases on a straight-line basis over the term of the lease.

Finance lease activity is included in property and equipment, net;

The Company recognizes lease expense (excluding variable lease costs) for its operating leases on a straight-line basis over the term of the lease.

Finance lease assets are included in property and equipment, net;

current finance lease liabilities are aggregated into other current liabilities;

and non-current finance lease obligations are aggregated in other non-current liabilities in the Company's Consolidated Balance Sheets.

Finance ROU assets are amortized on a straight-line basis over their estimated useful lives.

The execution of a sublease where remaining lease payments on the head lease exceed the anticipated sublease receipts reflects an indication of impairment which suggests the carrying value of the ROU asset may not be recoverable.

The Company compares the estimated undiscounted cash flows generated by the sublease to the current carrying value of the ROU asset.

If the undiscounted cash flows are less than the carrying value of the ROU asset, the Company records an impairment loss equal to the excess of the ROU asset's carrying value over its fair value consistent with other long-lived assets.

Income from subleased properties is recognized on a straight-line basis and presented as a reduction of costs, allocated among operating expense line items, in the Company's Consolidated Statements of Operations and Comprehensive Loss.

In addition to sublease rent, variable non-lease costs such as common-area maintenance and utilities are charged to subtenants over the duration of the lease for their proportionate share of these costs.

These variable non-lease income receipts are recognized in operating expenses as a reduction to costs incurred by the Company in relation to the head lease.

The Company determines the nature of a sale-leaseback transaction based on the determination of whether the transaction qualifies as a sale and whether there is a transfer in the control of assets.

If the transaction does not qualify as a sale, the Company recognizes the transaction as a failed sale-leaseback transaction (financing arrangement).

The Company records a financing obligation, and the assets that are included in the failed sale-leaseback transaction remain on the Consolidated Balance Sheets until the end of the lease term.

and non-current finance lease obligations are aggregated in other non-current liabilities in the Consolidated Balance Sheets.

Income from subleased properties is recognized and presented as a reduction of costs, allocated among operating expense line items, in the Consolidated Statements of Operations and Comprehensive Loss.

Foreign Currency

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The gain or loss resulting from the process of translating a foreign subsidiary's functional currency financial statements into U.S.

Dollars ("USD") is reflected as foreign currency cumulative translation adjustment and reported as a component of accumulated other

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comprehensive loss.

Dollars ("USD") is reflected as foreign currency cumulative translation adjustment and reported as a component of accumulated other comprehensive loss.

The translation adjustment for intercompany foreign currency loans that are permanent in nature are also recorded as accumulated other comprehensive loss.

Translation adjustments on intercompany accounts that are short term in nature are recorded as gain (loss) from foreign currency transactions.

For foreign entities where USD is the functional currency, re-measurement of gains and losses related to deferred tax assets and liabilities are reflected in income tax provision in the Company's Statements of Operations and Comprehensive Loss.

For foreign entities where USD is the functional currency, re-measurement of gains and losses related to deferred tax assets and liabilities are reflected in income tax provision in the Consolidated Statements of Operations and Comprehensive Loss.

Revenue Recognition

The Company applies the provisions of ASC 606, Revenue from Contracts with Customers , and all related applicable guidance.

The Company recognizes revenue under the core principle to depict the transfer of control to its customers in an amount reflecting the consideration to which it expects to be entitled.

In order to achieve that core principle, the Company applies the following five-step approach:

(1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when a performance obligation is satisfied.

The Company's contracts with customers may include multiple promised goods and services.

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Once the Company identifies the performance obligations, the Company will determine the transaction price based on contractually fixed amounts and an estimate of variable consideration.

In general, the transaction price is determined by estimating the fixed amount of consideration to which the Company is entitled for transfer of goods and services and all relevant sources and components of variable consideration.

Variable consideration is estimated based on the most likely amount or expected value approach, depending on which method the Company expects to better predict the amount of consideration to which it will be entitled.

Once the Company elects one of the methods to estimate variable consideration for a particular type of performance obligation, the Company will apply that method consistently.

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variable consideration are subject to constraint based on expected recovery from the customer.

Sales taxes remitted to government authorities are excluded from the transaction price.

The Company allocates the transaction price to each performance obligation based on relative SSP.

Judgment is exercised to determine the SSP of each distinct performance obligation.

The Company will constrain estimates of variable consideration based on its expectation of recovery from the customer.

Some sources of variable consideration such as refunds, penalties, or allowances will reduce transaction price.

These sources of variable consideration are relatively infrequent and generally not significant.

In most cases, the Company bundles multiple products and very few are sold on a standalone basis.

The Company primarily applies an adjusted market assessment approach for the determination of the SSP, which is supported by rate cards and pricing calculators that are periodically reviewed and updated to reflect the latest sales data and observable inputs by industry, channel, geography, customer size, and other relevant groupings.

The Company recognizes revenue when (or as) it satisfies a performance obligation by transferring promised goods or services to a customer.

Customers may obtain the control of promised goods or services over time or at a point in time.

The Company recognizes revenue net of sales taxes remitted to government authorities.

In general, transaction price is determined by estimating the fixed amount of consideration to which the Company is entitled for transfer of goods and services and all relevant sources and components of variable consideration.

Once the Company elects one of the methods to estimate variable consideration for a particular type of performance obligation, the Company will apply that method consistently.

Subscription-based revenues are typically recognized on a straight-line basis over the access period, which ranges from three to thirty-six months .

Revenue for validated Campaign Essentials ("vCE") and Comscore Campaign Ratings ("CCR") is recognized over time, either on a time-elapsed basis, as the Company is providing services that the customer is continuously consuming and receiving benefit from, or on an output method, such as volume of impressions processed.

Activation products vary in nature, and can be recognized over time, generally on an input method time-elapsed basis, as the Company provides continuous tracking of activity.

Other activation products are delivered at a point in time, based on custom attributes agreed upon by customers and the Company.

The Company's customized data services are delivered in the form of custom recurring reports or ad hoc reports.

Custom report performance obligations, in general, are transferred at a point in time once the product has been delivered to the customer.

Survey products vary in nature and can be recognized at a point in time, generally on an output method report delivery basis, once the final report has been delivered to the customer.

Other survey products are recognized over time, generally on a time-elapsed basis, as the Company provides access to continuous reporting on survey results through a user interface.

Survey services consist of survey design with subsequent data collection, analysis and reporting.

For performance obligations satisfied at a point in time, the Company evaluates a number of factors to determine whether control of goods and services has been transferred.

The Company considers whether there is a present right to payment and whether the customer has accepted the asset.

In many instances the Company has objective evidence of the acceptance criteria, while in other cases the acceptance provisions are substantive, and the customer must affirmatively signal acceptance.

The preceding two factors are not the only factors that may be considered.

Other considerations include, but are not limited to, whether risks and rewards of ownership have been transferred for a particular product.

For the majority of its products and services, the Company applies an adjusted market assessment approach for the determination of SSP for identified performance obligations.

In general, the Company bundles multiple products and very few are sold on a standalone basis.

The Company uses rate cards and pricing calculators that are periodically reviewed and updated to reflect the latest sales data and observable inputs by industry, channel, geography, customer size, and other relevant groupings.

Certain products are sold on a standalone basis in a narrow band of prices.

If a product is sold outside of the narrow band of prices, it will be assigned the midpoint of the narrow band for purposes of allocating transaction price on a relative SSP basis.

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Subscription-based revenues, and other products delivered continuously through a user interface, are recognized on a straight-line basis over an access period that can range from three months to five years .

Revenues for impression-based products are typically recognized over time, on a time-elapsed basis, as the customer is continuously consuming and receiving the benefits of campaign measurement, or an output method, such as volume of impressions processed during a discrete period.

Report-based revenues are recognized at a point in time, which is generally once the product has been delivered to the customer.

The Company also considers whether there is a present right to payment, and whether the customer has accepted the product if such acceptance provisions are substantive.

Customers may have the right to cancel their contracts by providing a written notice of cancellation, although most subscription-based contracts are non-cancelable.

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In the event a portion of a contract is refundable, revenue recognition is delayed until the refund provision lapses.

For multi-year contracts with annual price increases and no opt out clauses, the total consideration for each of the years included in the contract term will be combined and recognized on a straight-line basis over the term of the contract.

The Company may enter into multiple contracts with a single counterparty at or near the same time.

The Company will combine contracts and account for them as a single contract when one or more of the following criteria are met:

(i) the contracts are negotiated as a package with a single commercial objective, (ii) consideration to be paid in one contract depends on the price or performance of the other contract, and (iii) goods or services promised are a single performance obligation.

For transactions that involve third parties, the Company evaluates whether the Company is the principal, in which case the Company recognizes revenue on a gross basis.

If the Company is an agent, the Company recognizes revenue on a net basis.

In certain countries, the Company may use third-party resellers to sell its products and services.

In these transactions, the Company is generally the principal as the Company controls the products and services and is primarily responsible for providing them to the end user.

The Company also has certain revenue share arrangements that involve the use of partner data in its sales to end users or the use of its data in partner sales to end users.

For multi-year contracts with annual price increases, the total consideration for each of the years included in the contract term will be combined and recognized on a straight-line basis.

For transactions that involve third parties, the Company evaluates whether it is the principal, in which case it recognizes revenue on a gross basis.

If the Company is an agent, it recognizes revenue on a net basis.

This determination can require significant judgment for certain revenue share arrangements that involve the use of partner data in the Company's sales to end users or the use of its data in partner sales to end users.

In these arrangements, the Company assesses which party controls the specified goods or services before they are transferred to the customer, as well as other indicators such as the party primarily responsible for fulfillment, inventory risk, and discretion in establishing price.

The Company enters into a limited number of monetary contracts with multichannel video programming distributors ("MVPDs") that involve both the purchase and sale of services with a single counterparty.

The Company assesses each contract to determine if the revenue and expense should be presented gross or net.

Each contract is assessed to determine if the revenue and expense should be presented gross or net.

In some instances, the Company may provide free distinct goods or services as a form of non-cash consideration to the counterparty.

The Company recognizes revenue for these contracts to the extent that SSP is established for distinct services provided.

Any excess consideration above the established SSP of services is presented as an offset to cost of revenues in the Consolidated Statements of Operations and Comprehensive Loss.

Revenue is recognized for these contracts to the extent SSP is established for distinct services provided.

Any excess consideration above the established SSP of services is presented as a reduction to cost of revenues in the Consolidated Statements of Operations and Comprehensive Loss.

The fair value of non-cash consideration included in revenues during the years ended December 31, 2021 and 2020 totaled $ 4.0 million and $ 0.9 million, respectively.

The fair value of non-cash consideration included in cost of revenues during the years ended December 31, 2021 and 2020 totaled $ 3.9 million and $ 1.6 million, respectively.

No non-cash consideration was included in revenues or cost of revenues during the year ended December 31, 2019.

Contract Balances

Accounts receivable are billed and unbilled amounts related to the Company's rights to consideration as performance obligations are satisfied when the rights to payment become unconditional but for the passage of time.

Contract assets are included in prepaid expenses and other current assets within the Consolidated Balance Sheets.

Contract assets represent the Company's right to consideration in exchange for goods or services transferred to the customer either prior to the receipt of consideration or before payment is due.

Contract payments are generally due in advance for subscription-based services or prior to delivery of custom reports.

If a contract exists under ASC 606, advance payments are recorded as a contract liability or a customer advance until the performance obligations are satisfied and revenue is earned.

Contract liabilities relate to amounts billed in advance, or advance consideration received from customers, for which transfer of control of the good or service occurs at a later point in time.

Customer advances relate to amounts billed in advance, or advance considerations received from customers, for contracts with termination rights for which transfer of control of the good or service occurs at a later point in time.

Contract liabilities and customer advances to be recognized in the succeeding twelve-month period are classified as current and the remaining amounts are classified as non-current liabilities within the Consolidated Balance Sheets.

Transaction Price Allocated to the Remaining Performance Obligations

The Company elected an optional exemption to not disclose information about remaining performance obligations that have an original expected duration of one year or less, or where the transaction price allocated to unsatisfied performance obligations for which variable consideration is allocated entirely to a wholly unsatisfied performance obligation, or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation in accordance with the series guidance.

Costs to Obtain or Fulfill a Contract

The Company elected the practical expedient to recognize the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets is one year or less.

These costs include commission programs to compensate employees for obtaining new contracts and are included in selling and marketing expense.

Certain costs to fulfill are capitalized in relation to long-term contracts wherein the transfer of goods and services will occur at a point in time.

In addition, the Company capitalizes costs to fulfill for long-term contracts that are incurred during a setup period prior to transferring control of the good or service over time.

Accounts receivable are billed and unbilled amounts where the right to payment from the customer is unconditional but for the passage of time.

Contract assets represent amounts where the right to payment in exchange for goods or services transferred is conditioned on future events, such as the entity's continued performance.

The portion of contract assets to be billed in the succeeding twelve-month period are included in prepaid expenses and other current assets, and the remaining amounts are included in other assets within the Consolidated Balance Sheets.

Contract liabilities relate to amounts billed in advance, or advance consideration received from customers, under non-cancelable contracts for which exchange of goods or services will occur in the future.

Customer advances relate to amounts billed in advance, or advance considerations received from customers, for contracts with termination rights for which exchange of goods or services will occur in the future.

The portion of contract liabilities and customer advances to be recognized in the succeeding twelve-month period are presented separately within current liabilities, and the remaining amounts are included in other non-current liabilities within the Consolidated Balance Sheets.

Remaining Performance Obligations

The Company elected an optional exemption to not disclose information about the amount of the transaction price allocated to remaining performance obligations for contracts that have an original expected duration of one year or less.

The amount disclosed for remaining performance obligations also excludes variable consideration from unsatisfied performance obligations within a series where revenue is recognized using an output method, such as volume of impressions processed.

Costs to Fulfill a Contract

Certain costs to fulfill are capitalized for contracts where the transfer of goods and services will occur in the future.

Typically, these capitalized costs are incurred during a setup period prior to transferring control of the good or service over time.

These costs include dedicated employees, subcontractors, and other third-party costs.

The Company will assess capitalized costs to fulfill at each reporting period for recoverability.

These costs are included in cost of revenue and are recognized in the same manner as the corresponding performance obligation.

Capitalized costs are assessed for recoverability at each reporting period.

These costs are included in

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cost of revenues and are recognized in the same manner as the corresponding performance obligation.

For the years ended December 31, 2021, 2020 and 2019, amortized and expensed contract costs were $ 2.7 million, $ 1.4 million and $ 1.9 million, respectively.

Cost of Revenues

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Also included are litigation related expenses, which include legal fees associated with various lawsuits or investigations that were initiated either directly or indirectly as a result of the Audit Committee's investigation.

Other Income (Expense), Net

The following is a summary of other income (expense), net:

Other (Expense) Income, Net

Other (expense) income, net represents income and expenses incurred that are generally not recurring in nature or are not part of the Company's normal operations.

The following is a summary of the significant components of other (expense) income, net:

Years Ended December 31,

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Change in fair value of warrants liability ( 7,689 ) 4,894 ( 2,411 )

Change in fair value of interest make-whole derivative ( 871 ) — —

Change in fair value of investment in equity securities — — ( 2,324 )

Transition services agreement income — 534 9,029

Other 111 ( 627 ) 1,289

Total other income (expense), net $ 14,554 $ 1,654 $ ( 1,464 )

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash, cash equivalents, restricted cash and accounts receivable.

The Company maintains cash deposits with financial institutions that, from time to time, exceed applicable insurance limits.

The Company reduces this risk by maintaining such deposits with high quality financial institutions that management believes are creditworthy.

With respect to accounts receivable, credit risk is mitigated by the Company's ongoing credit evaluation of its customers' financial condition.

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Total other (expense) income, net $ ( 5,778 ) $ 14,554 $ 1,654

Debt Issuance Costs

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Debt issuance costs are amortized to interest expense, net over the term of the underlying debt instrument, utilizing the effective interest method.

Derivative Financial Instruments

The Company has derivative financial instruments that are not hedges and do not qualify for hedge accounting.

Changes in the fair value of these instruments are recorded in other income (expense), net in the Consolidated Statements of Operations and Comprehensive Loss.

Stock-Based Compensation

The Company estimates the fair value of stock-based awards on the date of grant.

The Company estimates the fair value of stock-based awards on their grant date.

The fair value of stock options with only service conditions is determined using the Black-Scholes option pricing model.

The fair value of restricted stock units ("RSUs") and restricted stock awards is based on the closing price of the Company's Common Stock on the date of grant.

The Company amortizes the fair value of awards expected to vest on a straight-line basis over the requisite service periods of the awards, which is generally the period from the grant date to the end of the vesting period.

The determination of the fair value of the Company's stock option awards is based on a variety of factors, including, but not limited to, the Company's Common Stock price, risk-free rate, expected stock price volatility over the expected life of awards, dividend yield and actual and projected exercise behavior.

Additionally, the Company has estimated forfeitures for stock-based awards at the dates of grant based on historical experience and adjusted for future expectation.

The Company performs a review of the forfeiture rate assumption at least annually or as deemed necessary if there are changes that could potentially significantly impact the future rate of forfeiture of its stock-based awards.

The forfeiture estimate is revised as necessary if actual forfeitures differ from these estimates.

The fair value of restricted stock units ("RSUs") is based on the closing price of the Company's Common Stock on the grant date.

The Company amortizes the fair value of awards expected to vest on a straight-line basis over the

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requisite service periods of the awards, which is generally the period from the grant date to the end of the vesting period.

The Company issues stock options with a vesting period based solely upon the passage of time (service vesting).

In considering expected exercise behavior the Company applies the simplified method for plain-vanilla options due to the lack of significant historical exercise experience.

For non-employee options that do not qualify as plain-vanilla the Company generally elects to apply the contractual term of the award.

The Company issues RSU awards with restrictions that lapse upon the passage of time (service vesting), achieving performance targets, fulfillment of market conditions or a combination thereof.

To determine the expected term of the option the Company applies the simplified method for plain-vanilla options due to the lack of significant historical exercise experience.

For non-employee options that do not qualify as plain-vanilla the Company has elected to apply the contractual term of the award.

The Company issues RSU awards with a vesting period based solely upon the passage of time (service vesting), achieving performance targets, fulfillment of market conditions, or a combination thereof.

For those RSU awards with only service vesting, the Company recognizes compensation cost on a straight-line basis over the service period.

For awards with performance conditions only, or performance and service conditions, the Company starts recognizing compensation cost over the remaining service period when it is probable the performance conditions will be met.

For awards with both service and performance conditions, the Company starts recognizing compensation cost over the remaining service period when it is probable the performance conditions will be met.

Stock awards that contain performance vesting conditions are excluded from diluted earnings per share ("EPS") computations until the contingency is met as of the end of that reporting period.

For awards with market conditions, the Company recognizes compensation cost over the remaining service period, with the effect of the market condition reflected in the calculation of the award's fair value at the grant date.

The Company values awards with market conditions using certain valuation techniques, such as a Monte Carlo simulation analysis.

For awards with both service and market conditions, the Company recognizes compensation cost over the remaining service period, with the effect of the market condition reflected in the determination of the award's fair value at the grant date.

The Company values awards with market conditions using certain valuation techniques, such as a lattice model or Monte Carlo simulation analysis.

The Company determines the requisite service period based on the longer of the explicit service period and the derived service period.

Stock awards that contain market vesting conditions are included in the computations of diluted EPS reflecting the number of shares that would be issued based on the current market price at the end of the period being reported on, if their effect is dilutive.

Under the Company's annual incentive compensation plan, the Company may grant immediate or future vesting RSUs to certain employees.

For these awards, stock-based compensation expense is recognized over the requisite service period, which generally precedes the grant date.

The Company accrues stock-based compensation expense for these awards until the date of grant.

Under the Company's annual incentive compensation plan, the Company may grant immediately vested RSUs to certain employees.

For these awards, stock-based compensation expense is accrued commencing at the service inception date, which generally precedes the grant date, through the end of the requisite service period.

The Company estimates forfeitures for stock-based awards at their grant date based on historical experience.

The estimated forfeiture rate as of December 31, 2021, 2020 and 2019 was 10.0 % for non-executive awards.

Awards granted to senior executives have an estimated forfeiture rate of zero .

The Company performs a review of its forfeiture rate assumption on a quarterly basis.

Changes in the estimates and assumptions relating to forfeitures and subsequent grants may result in material changes to stock-based compensation expense in the future.

Income taxes are accounted for using the asset and liability method.

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In addition, the Company considers the time frame over which it would take to utilize the deferred tax assets prior to their expiration.

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For certain tax positions, the Company uses a more-likely-than-not threshold based on the technical merits of the tax position taken.

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net deferred tax assets, these provisions have not had a material impact on the Company's consolidated financial statements.

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Loss Per Share

Basic net loss per common share excludes dilution for potential Common Stock issuances and is computed by dividing net loss by the weighted-average number of shares of Common Stock outstanding for the period.

250,000 shares of Common Stock issuable upon the exercise of warrants ("penny warrants") were included in the number of outstanding shares used for the computation of basic net loss per share prior to the exercise of those warrants in April 2019.

In periods with a reported net loss, the effect of anti-dilutive stock options, stock appreciation rights, restricted stock units, senior secured convertible notes and warrants are excluded and diluted loss per share is equal to basic loss per share.

The Company uses the two-class method to calculate net loss per share.

The two-class method is an earnings allocation formula that treats a participating security as having rights to earnings that otherwise would have been available to common stockholders.

Under the two-class method, earnings for the period are allocated between common stockholders and participating security holders based on their respective rights to receive dividends as if all undistributed book earnings for the period were distributed.

Basic loss per share is computed by dividing net loss attributable to only the common stockholders by the weighted-average number of common shares outstanding for the period.

Diluted loss per share includes the effect of potential common shares, such as the Company's Preferred Stock, Notes, warrants, stock options, restricted stock units and deferred stock units, to the extent the effect is dilutive.

In periods with a net loss available to common stockholders, the anti-dilutive effect of these potential common shares is excluded and diluted net loss per share is equal to basic net loss per share.

The following is a summary of the Common Stock equivalents for the securities outstanding during the respective periods that have been excluded from the computation of diluted net loss per common share, as their effect would be anti-dilutive:

Years Ended December 31,

2020 2019 2018

Stock options, stock appreciation rights, restricted stock units, senior secured convertible notes and warrants 16,724,946 12,443,032 8,392,748

Comprehensive Loss

Comprehensive loss consists of net loss and foreign currency translation adjustments.

Accounting Standards Recently Adopted

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) , which removes and modifies certain disclosure requirements under Topic 820.

Preferred stock 66,926,499 — —

Warrants 5,457,026 6,306,964 3,795,761

Stock options, restricted stock units and deferred stock units 5,073,980 3,898,327 2,127,616

Senior secured convertible notes 1,232,483 6,519,655 6,519,655

Total 78,689,988 16,724,946 12,443,032

(1) A contingent consideration liability was recognized as part of the acquisition described in Footnote 3 , Business Combination.

The liability payments may be settled in any combination of cash or shares of Common Stock based on the volume-weighted average trading price of the Common Stock for the ten trading days prior to the date of each payment.

Settlement of this liability in Common Stock could potentially dilute basic earnings per share in future periods.

The Company calculated a potential anti-dilutive share count based on the maximum potential payments of $ 8.6 million and the $ 3.34 per share closing price of the Company's Common Stock on the Nasdaq Global Select Market on December 31, 2021.

The impact was determined to be negligible for 2021 based on the period the liability was outstanding.

For the year ended December 31, 2021, dividends to holders of the Preferred Stock, including those both paid and accrued, totaled $ 12.6 million.

These dividends have been included in calculating the total loss available to common stockholders used in the calculation of basic and diluted loss per share.

Other Accounting Standards Recently Adopted

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), which simplifies the accounting for income taxes primarily by eliminating certain exemptions.

The amendments are effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.

An entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and to delay adoption of the additional disclosures until their effective date.

The Company adopted the new standard effective January 1, 2020, and the standard did not have a material impact on the Consolidated Financial Statements or related disclosures.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) , which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost.

ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires consideration of forward-looking information to calculate credit loss estimates.

These changes will result in an earlier recognition of credit losses.

The amendment is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years.

The Company's financial assets held at amortized cost include certificates of deposit, accounts receivable and contract assets.

The Company adopted the new standard effective January 1, 2020, and the standard did not have a material impact on the Consolidated Financial Statements or related disclosures based on historical collection trends, the financial condition of payment partners, and external market factors.

Recently Issued Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) , which simplifies the accounting for income taxes by eliminating certain exemptions as well as a few other changes.

The Company adopted the new standard effective January 1, 2021, which had no impact on the Consolidated Financial Statements or related disclosures.

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805), which addresses the accounting for contract assets and liabilities from revenue contracts with customers in a business combination.

The amendments require acquiring entities to apply Accounting Standards Codification ("ASC") 606 to recognize and measure contract assets and contract liabilities in a business combination.

The amendments are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

An entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and to delay adoption of the additional disclosures until their effective date.

The Company is in the process of evaluating the guidance but does not believe that the adoption of this standard will have a material impact on the Consolidated Financial Statements or related disclosures.

An entity is permitted to early adopt.

The Company adopted the new standard effective January 1, 2021, which did not have a material impact on the Consolidated Financial Statements or related disclosures.

Business Combination

On December 16, 2021, the Company and two newly formed, wholly owned subsidiaries of the Company entered into the Merger Agreement (the "Merger") with Shareablee.

Total consideration payable to the former holders of Shareablee's capital stock and warrant, and certain underlying equity awards that were assumed by the Company, totaled 9,128,964 shares of Common Stock.

This included 7,945,519 shares of Common Stock that were issuable at closing, 1,062,085 shares of Common Stock issuable pursuant to replacement stock options and restricted stock unit awards, and 121,360 shares of Common Stock subject to holdback pending final working capital adjustments.

In addition, certain holders of Shareablee's capital stock, warrant and equity awards may also receive up to an aggregate of $ 8.6 million of contingent consideration over three years after the closing, subject to the satisfaction of certain conditions set forth in the Merger Agreement.

The contingent consideration is payable in any combination of cash and Common Stock, with any issuance of Common Stock to be based on the volume-weighted average trading price of the Common Stock for the ten full trading days ending on, and including the last business day prior to, the applicable date of the release of the contingent payment.

The amount of contingent consideration is based on the achievement of certain contractual milestones or a revenue target.

Lastly, the Merger Agreement required a portion of cash held in escrow at closing to be paid to the former holders of Shareablee securities.

Itzhak Fisher, a member of the Company's Board of Directors ("Board"), is a former director, stockholder and equity award holder of Shareablee.

The fair value of Mr.

Fisher's issuable Common Stock and replacement stock options totaled $ 0.7 million at closing, of which $ 0.4

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In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815-40), which simplifies accounting for convertible instruments, enhances disclosure requirements related to the terms and features of convertible instruments, and amends the guidance for the derivatives scope exception for contracts settled in an entity's own equity.

The amendments are effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years.

Early adoption is permitted, but not earlier than periods beginning after December 15, 2020.

million was recognized immediately as stock-based compensation expense and $ 0.3 million was classified as purchase consideration.

Fisher is also eligible to earn up to an additional $ 0.3 million in contingent consideration subject to the performance criteria described above.

The total consideration paid or payable by the Company related to the Merger was $ 31.4 million.

A summary of the consideration is as follows:

(In thousands) Fair Value

Common Stock (1)

Contingent consideration (2)

Replacement stock options and restricted stock unit awards 260

Escrow payable to former stockholders 184

Total purchase consideration $ 31,373

(1) Calculated based on 7,945,519 shares of Common Stock issued upon closing, an estimated 121,360 shares of Common Stock to be issued upon completion of a final working capital assessment, and the $ 3.14 per share closing price of the Company's Common Stock on the Nasdaq Global Select Market on December 16, 2021.

(2) Refer to Footnote 2 , Summary of Significant Accounting Policies for additional information on the selected valuation technique, and Footnote 7 , Fair Value Measurements for inputs in deriving the fair value as of December 16, 2021.

The Company concluded any change in fair value between December 16, 2021 and December 31, 2021 was negligible.

A summary of the total purchase consideration for Shareablee that was allocated to the acquired assets and liabilities based on their fair value as of the date of the Merger is as follows:

(In thousands) December 16, 2021

Net working capital $ ( 2,212 )

Property and equipment, net 4,578

Deferred tax liabilities ( 2,817 )

Other assets and liabilities ( 22 )

Definite-lived intangible assets 12,644

Goodwill 19,202

Total purchase consideration $ 31,373

The goodwill and intangible assets recorded as a result of the Merger are not deductible for income tax purposes.

The goodwill includes the value of the Shareablee acquired workforce, the expected cost synergies to be realized by the Company following the Merger, the opportunity to combine the Company's digital information with Shareablee's social data and insights to enhance the Company's syndicated product offerings, and the opportunity to sell Shareablee products to the Company's customer base.

The following table outlines the fair value of the definite-lived intangible assets and the useful life for each type of intangible asset acquired.

The intangible assets are amortized using a straight-line method over the respective useful life of the intangible asset.

(In thousands) Useful Lives (Years) Fair Value

Customer relationships (1)

Acquired methodologies and technology (1) (2)

Total definite-lived intangible assets $ 12,644

(1) The fair values of these assets are derived from techniques which utilize inputs, certain of which are significant and unobservable, that result in classification as Level 3 fair value measurements.

Refer to Footnote 2 , Summary of Significant Accounting Policies for additional information on the selected valuation techniques.

(2) The acquisition-date fair value of acquired methodologies and technology was $ 10.6 million.

The $ 6.0 million recognized within intangible assets, net reflects the incremental fair value adjustment to $ 4.6 million of capitalized internal-use software costs recorded at net book value within property and equipment, net as of December 16, 2021.

The primary assets acquired were the developed methodologies and technology, which include a proprietary taxonomy and analytics platform that processes and repackages information on social media data consumption across four large social media platforms.

The Company incurred professional fees directly attributable to the Merger, primarily consisting of legal fees totaling $ 0.5 million during 2021.

These fees are reflected in general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Loss.

The financial results of Shareablee were included in the Company's Consolidated Financial Statements from the date of the Merger, December 16, 2021.

For the year ended December 31, 2021, Shareablee contributed revenues of $ 0.4 million and loss before income tax provision of $ 1.4 million.

The loss includes $ 1.5 million in stock-based compensation recognized immediately following the closing date pertaining to replacement stock options and restricted stock unit awards issued to Shareablee equity award holders.

Pro forma results of operations for the Merger have not been presented because they are not material to the Company's consolidated results of operations.

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Revenue Recognition

20 unchanged sentences

By timing of revenue recognition :

Products and services transferred at a point in time $ 77,398 $ 93,036 $ 113,583

Products and services transferred over time $ 288,439 $ 278,638 $ 295,609

Products and services transferred at a point in time 78,574 77,398 93,036

Total $ 367,013 $ 356,036 $ 388,645

2 unchanged sentences

Contract Balances

The following table provides information about receivables, contract assets, contract costs, contract liabilities and customer advances from contracts with customers:

The following table provides information about receivables, contract assets, contract liabilities and customer advances from contracts with customers:

As of December 31,

2 unchanged sentences

Current and non-current contract assets 4,875 4,037

Current and non-current contract costs 430 799

Current contract liabilities 54,011 58,529

1 unchanged sentence

Non-current contract liabilities 1,262 4,156

Current and non-current contract assets as of December 31, 2020 increased from the prior year due primarily to the Company providing payment deferrals, in exchange for contract extensions, on certain of its movies contracts because of theater closures as a result of the COVID-19 pandemic.

Non-current contract liabilities as of December 31, 2020 increased from the prior year due primarily to a large upfront payment received on a new multi-year contract.

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Current and non-current contract assets as of December 31, 2021 increased from the prior year due primarily to up-front recognition of revenue pertaining to license fees in connection with a multi-year agreement that will be billed over the contract term.

Non-current contract liabilities as of December 31, 2021 decreased from the prior year as revenue was recognized on a multi-year contract that had a large upfront payment received in 2020.

Significant changes in the current contract liabilities balances are as follows:

Contract Liability (Current)

Years Ended December 31,

2 unchanged sentences

Cash received or amounts billed in advance and not recognized as revenue 48,864 50,836

Transaction Price Allocated to the Remaining Performance Obligations

As of December 31, 2020, approximately $ 210 million of revenue is expected to be recognized from remaining performance obligations that are unsatisfied (or partially unsatisfied) for non-cancelable contracts.

Current contract liabilities as of December 31, 2021 included $ 2.5 million in contract balances recognized as part of the closing of the acquisition described in Footnote 3 , Business Combination .

Remaining Performance Obligations

As of December 31, 2021, approximately $ 210 million of revenue is expected to be recognized from remaining performance obligations that are unsatisfied (or partially unsatisfied) under long-term contracts.

The Company expects to recognize revenue on approximately 50 % of these remaining performance obligations in 2022, and approximately 25 % in 2023, with the remainder recognized thereafter.

Costs to Obtain or Fulfill a Contract

For the years ended December 31, 2020, 2019 and 2018, amortized and expensed contract costs were $ 1.4 million, $ 1.9 million and $ 2.3 million, respectively.

Issuance and Sale of Initial Notes

On January 16, 2018, the Company entered into certain agreements with Starboard, pursuant to which, among other things, the Company issued and sold to Starboard $ 150.0 million of senior secured convertible notes (the "Initial Notes") in exchange for $ 85.0 million in cash and 2,600,000 shares of Common Stock valued at $ 65.0 million.

Based upon the fair value of the Common Stock on the closing date of the Initial Notes issuance, January 16, 2018, which was $ 24.45 per share, the difference of $ 1.4 million was recorded as an issuance discount to the Initial Notes.

The Company also granted to Starboard an option (the "Notes Option") to acquire up to an additional $ 50.0 million in senior secured convertible notes (the "Option Notes" and together with the Initial Notes, the "Notes") and agreed to grant Starboard warrants to purchase 250,000 shares of Common Stock at a price of $ 0.01 per share, as adjusted pursuant to the terms of the warrants.

The warrants were issued on October 12, 2018 and were exercised in full by Starboard on April 3, 2019 for 323,448 shares of Common Stock.

The conversion price for the Notes (the "Conversion Price") is equal to a 30 % premium to the volume weighted average trading prices ("VWAP") of the Common Stock on each trading day during the 10 consecutive trading days commencing on January 16, 2018, subject to a Conversion Price floor of $ 28.00 per share.

In accordance with the foregoing, the Conversion Price was set at $ 31.29 per share.

The Notes mature on January 16, 2022.

As described in Footnote 1 , Organization, and Footnote 16 , Subsequent Events, on March 9, 2021, the Company's stockholders approved Transactions for which the proceeds will be used to repay the Notes prior to maturity.

Based upon the determination of the Conversion Price, interest on the Notes accrued at 6.0 % per year through January 30, 2019.

On January 30, 2019, the interest rate reset to 12.0 % through January 30, 2020.

On January 30, 2020, the interest rate reset and remained at 12.0 % through February 1, 2021.

On February 1, 2021, the interest rate was determined to remain at 12.0 % through maturity based on the reset calculation.

The interest rate reset feature of the Initial Notes was determined by management to be a derivative instrument that qualifies for liability treatment.

The derivative instrument is initially measured at fair value and classified as a liability on the balance sheet, with subsequent changes in fair value being recorded in earnings.

To determine the fair value of the interest rate reset feature, management utilized a "with-and-without" convertible bond model, modified to incorporate the interest rate reset feature, using the following key assumptions:

• Credit Adjusted Discount Rate :

The Company estimated a market-based discount rate of 25.0 %.

• Stock Price :

The stock price was measured using the fair value of the Common Stock on the closing date of the Initial Notes issuance, January 16, 2018, which was $ 24.45 per share.

• Volatility :

Based on the historical volatility of the Company's Common Stock, determined to be 41.3 % as of the valuation date.

Based on the time period of the Notes maturity, 4 years.

• Risk Free Rate :

Assumed to be 2.2 % based on the Federal Reserve bond yield.

Based upon the modified convertible bond model utilized by management, the fair value of the interest rate reset feature was determined to be $ 6.4 million as of January 16, 2018 and was recognized as an issuance discount for the Initial Notes at inception.

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Interest on the Initial Notes is payable on a quarterly basis in arrears beginning on April 1, 2018, at the option of the Company, in cash, or, subject to certain conditions, through the issuance by the Company of additional shares of Common Stock (the "PIK Interest Shares").

Any PIK Interest Shares so issued will be valued at the arithmetic average of the VWAP of the Common Stock on each trading day during the 10 consecutive trading days ending immediately preceding the applicable interest payment date.

On each of January 2, 2020, April 1, 2020 and July 1, 2020, the Company paid quarterly accrued interest of $ 6.1 million in cash.

On October 1, 2020, the Company paid quarterly accrued interest of $ 6.1 million through the issuance of 1,474,201 PIK Interest Shares and $ 3.1 million in cash.

On January 25, 2021, the Company paid its quarterly accrued interest of $ 6.1 million through the issuance of 2,802,454 PIK Interest Shares.

The interest paid on January 25, 2021 was classified within other non-current liabilities in the Consolidated Financial Statements as of December 31, 2020.

For the remaining interest payment from January 1, 2021 through the closing of the Transactions, the Company intends to pay interest due through the issuance of PIK Interest Shares.

Management evaluated the Notes Option and determined that it met the definition of a derivative as it represented a written option.

The Notes Option qualified for liability treatment and was initially measured at fair value, with subsequent changes in fair value being recorded in earnings.

To determine the fair value of the Notes Option, management utilized an option pricing model as the option represents a put option that gains value as the underlying asset (Common Stock) decreases in value.

The following key assumptions were utilized in the Company's estimate of the fair value of the Notes Option derivative:

• Stock Price :

The stock price was measured using the fair value of the Common Stock on the closing date of the Initial Notes issuance, January 16, 2018, which was $ 24.45 per share.

• Volatility :

Based on the historical volatility of the Company's Common Stock, determined to be 38.4 % as of the valuation date.

Based on the time period of the Notes Option, 6 months.

• Risk Free Rate :

Assumed to be 1.6 % based on the Federal Reserve bond yield with a term commensurate with the remaining life of the Notes Option.

Based upon the option pricing model utilized, management estimated the fair value of the Notes Option as of January 16, 2018 to be $ 2.1 million.

The fair value was recognized as an issuance discount for the Initial Notes at inception.

The Initial Notes contain redemption provisions whereby, upon the occurrence of certain change of control transactions, a holder would have the right to require the Company to redeem all or any portion of such holder's outstanding Initial Notes for cash at a price determined in accordance with the terms of the Initial Notes (the "make-whole change of control redemption").

Management evaluated this make-whole change of control redemption feature and determined that it represented an embedded derivative that must be bifurcated and accounted for separately from the Initial Notes.

The make-whole change of control derivative is treated as a liability, initially measured at fair value with subsequent changes in fair value recorded in earnings.

Management utilized a probability-adjusted binomial lattice model to determine the fair value of the make-whole change of control derivative, with the following key assumptions:

• Probability :

The Company utilized a range between 0 % and 10 % to estimate the likelihood of occurrence.

Based on the time period of the feature, 4 years.

• Risk Free Rate :

Assumed to be 2.2 % based on the U.S.

Treasury bonds on the valuation date with a term commensurate with the remaining life of the change of control derivative.

Based on the binomial lattice model, the Company determined the fair value of the make-whole redemption provision as of January 16, 2018 to be $ 4.4 million.

The fair value was recognized as an issuance discount of the Initial Notes at inception.

See "Notes Modifications" below.

The Notes contain certain affirmative and restrictive covenants with which the Company must comply, including (i) covenants with respect to limitations on additional indebtedness, (ii) limitations on liens, (iii) limitations on certain payments, (iv) maintenance of certain minimum cash balances (currently $ 40.0 million), and (v) the timely filing of certain disclosures with the SEC.

The Company is in compliance with its debt covenants as of December 31, 2020.

In connection with the issuance of the Initial Notes, the Company also agreed to issue to Starboard warrants to purchase 250,000 shares of Common Stock at a price of $ 0.01 per share, as adjusted pursuant to the terms of the warrants.

The warrants were issued on October 12, 2018 and were exercisable for five years from the date of issuance.

The Company valued the warrants using the Black-Scholes model, with the following key assumptions:

• Stock Price :

The stock price was measured using fair value of the Common Stock on the closing date of the Initial Notes issuance, January 16, 2018, which was $ 24.45 per share.

• Volatility :

The Company determined volatility to be 39.6 % based on the historical volatility of its Common Stock daily volume weighted average price with a look-back period commensurate with the term of the warrants.

• Risk Free Rate :

Assumed to be 2.4 % based on U.S.

Treasury bonds on the valuation date with a 5 -year term.

• Dividend Yield :

Assumed to be zero based on the historical payout history of the Company.

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Based on the Black-Scholes model, the Company determined that the fair value of the warrants as of January 16, 2018 was $ 6.1 million.

The Company recorded the warrants at allocated proceeds of $ 5.7 million, less allocated issuance costs of $ 0.2 million, as additional paid-in capital.

The cash proceeds and Common Stock received by the Company in exchange for the Initial Notes were net of a $ 20.1 million issuance discount and $ 4.6 million in third party deferred financing costs.

On August 8, 2018, the Company and Starboard entered into an amendment to the outstanding Notes to reduce the requirement to maintain certain minimum cash balances.

In connection with and as consideration for this modification, the Company issued to Starboard $ 2.0 million in additional aggregate principal amount of senior secured convertible notes, $ 1.5 million of which was classified as additional Initial Notes.

The terms of the additional notes are identical to the terms of the Initial Notes, except with regard to the date from which interest began to accrue thereon, which is August 8, 2018.

The amendment is treated as a modification to the debt agreements and the costs related to the issuance of the additional notes were combined with the existing unamortized discount of the Initial Notes on the modification date and will be amortized to interest expense over the remaining term of the modified debt.

In connection with the modification of the Notes, the Company recorded $ 0.2 million in additional derivative liabilities.

On November 13, 2018, the Company and Starboard entered into an agreement whereby the applicable period for the $ 20.0 million minimum cash balance required to be maintained by the Company was extended until the earlier of August 9, 2019 or the date the Company filed its Form 10-Q for the quarterly period ended June 30, 2019, subject to certain limitations.

The agreement also modified the provisions of the Notes and the Registration Rights Agreement between the Company and Starboard by revising the grace periods during which the Company would not be obligated to keep applicable registration statements available for use by Starboard.

In connection with, and as consideration for these amendments, the Company issued to Starboard $ 2.0 million in additional aggregate principal amount of senior secured convertible notes, the terms of which are identical to the terms of the Initial Notes, except with regard to the date from which interest began to accrue thereon, which is November 13, 2018.

In connection with this modification, the Company recorded $ 0.2 million in additional derivative liabilities.

Additional modifications to the Initial Notes are described under "Notes Modifications" below.

Issuance and Sale of Option Notes

On May 17, 2018, the Notes Option was exercised by Starboard, pursuant to which the Company issued and sold to Starboard $ 50.0 million of Option Notes in exchange for $ 15.0 million in cash and 1,400,000 shares of Common Stock valued at $ 35.0 million.

Based upon the fair value of the Common Stock on the closing date of the Option Notes issuance, May 17, 2018, which was $ 21.75 per share, the difference of $ 4.6 million was recorded as an issuance discount to the Option Notes.

The Option Notes have the same terms, including maturity, interest rate, convertibility, and security, as the Initial Notes, except with regard to the date from which interest began to accrue thereon, which was May 17, 2018.

Upon the exercise of the Notes Option, the derivative liability recorded for the Notes Option at inception was settled.

Management determined the fair value of the Notes Option immediately prior to settlement utilizing an option pricing model using the following key assumptions:

• Stock Price :

The stock price was measured using the fair value of the Common Stock on the closing date of the Option Notes issuance, May 17, 2018, which was $ 21.75 per share.

• Volatility :

Based on the historical volatility of the Company's Common Stock, determined to be 26.3 % as of the valuation date.

Based on the time period of the expected exercise of the Notes Option, 0.16 years.

• Risk Free Rate :

Assumed to be 1.8 % based on the Federal Reserve bond yield with a term commensurate with the remaining life of the Notes Option.

Based upon the option pricing model utilized, management estimated the fair value of the Notes Option as of May 17, 2018 to be $ 5.7 million.

The loss related to the change in fair value of $ 1.6 million was recorded in other income (expense), net on the Consolidated Statements of Operations and Comprehensive Loss.

The fair value of the Notes Option was recognized as an issuance premium for the Option Notes at inception.

The interest rate reset feature of the Option Notes was determined by management to be a derivative instrument that qualifies for liability treatment.

The derivative instrument is initially measured at fair value and classified as a liability on the balance sheet, with subsequent changes in fair value being recorded in earnings.

• Credit Adjusted Discount Rate :

The Company estimated a market-based discount rate of 24 %.

• Stock Price :

The stock price was measured using the fair value of the Common Stock on the closing date of the Option Notes issuance, May 17, 2018, which was $ 21.75 per share.

• Volatility :

Based on the historical volatility of the Company's Common Stock, determined to be 42.6 % as of the valuation date.

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Based on the time period of the Option Notes maturity, 3.7 years.

• Risk Free Rate :

Assumed to be 2.8 % based on the Federal Reserve bond yield.

Based upon the modified convertible bond model utilized by management, the fair value of the interest rate reset feature was determined to be $ 3.0 million as of May 17, 2018 and was recognized as an issuance discount for the Option Notes at inception.

The Option Notes contain redemption provisions whereby, upon the occurrence of certain change of control transactions, a holder would have the right to require the Company to redeem all or any portion of such holder's outstanding Option Notes for cash at a price determined in accordance with the terms of the Option Notes.

Management evaluated the make-whole change of control redemption feature and determined that it represented an embedded derivative that must be bifurcated and accounted for separately from the Option Notes.

The make-whole change of control derivative is treated as a liability, initially measured at fair value with subsequent changes in fair value recorded in earnings.

Management utilized a probability-adjusted binomial lattice model to determine the fair value of the make-whole change of control derivative, with the following key assumptions:

• Probability :

The Company utilized a range between 0 % and 10 % to estimate the likelihood of occurrence.

Based on the time period of the feature, 3.7 years.

• Risk Free Rate :

Assumed to be 2.8 % based on U.S.

Treasury bonds on the valuation date with a term commensurate with the remaining life of the change of control derivative.

Based on the binomial lattice model, the Company determined the fair value of the make-whole redemption provision as of May 17, 2018 to be $ 1.2 million.

The fair value was recognized as an issuance discount of the Option Notes at inception.

See "Notes Modifications" below.

The cash proceeds and Common Stock received by the Company in exchange for the Option Notes were net of a $ 3.1 million issuance discount and $ 0.2 million in third-party deferred financing costs.

On August 8, 2018, the Company and Starboard entered into an amendment to the outstanding Notes to reduce the requirement to maintain certain minimum cash balances.

In connection with the modification, the Company issued to Starboard $ 2.0 million in additional aggregate principal amount of senior secured convertible notes, $ 0.5 million of which was classified as additional Option Notes.

The terms of the additional notes are identical to the terms of the Option Notes, except with regard to the date from which interest began to accrue thereon, which is August 8, 2018.

Additional modifications to the Option Notes are described under "Notes Modifications" below.

Notes Modifications

In accordance with the amendments described above, the minimum cash balance under the Notes covenant increased to $ 40.0 million upon filing of the Company's quarterly report on Form 10-Q on August 6, 2019.

On November 6, 2019, the Company and Starboard entered into an additional amendment to the Notes.

The terms of the Notes were amended to provide the Company with an optional redemption right, whereby, in connection with a qualifying change of control pursuant to documentation entered into no later than August 5, 2020, the Company had the right to redeem the Notes in full in cash at a price equal to the sum of (i) the aggregate outstanding principal amount of the Notes, as of the consummation of the qualifying change of control, (ii) accrued interest, (iii) any other amounts owed pursuant to the Notes, and (iv) a 20 % premium on the aggregate outstanding principal amount of the Notes (the "qualifying change of control redemption").

The amendment also provided for an adjustment to the minimum cash balance required to be maintained by the Company.

Upon execution of documentation providing for a qualifying change of control, the $ 40.0 million minimum cash balance would be reduced, on a dollar for dollar basis, for each dollar of cash interest paid to the holders of the Notes, subject to a $ 20.0 million minimum, until consummation of the qualifying change in control or, upon termination of the change in control, the shorter of 90 days after such termination or the consummation of a financing that would enable the Company to maintain a minimum cash balance of $ 40.0 million.

The amendment also modified the provisions of the Registration Rights Agreement between the Company and Starboard by revising the grace periods during which the Company would not be obligated to keep applicable registration statements available for use by Starboard.

Management evaluated the qualifying change of control redemption feature, described above, and determined that it represented an embedded derivative that must be bifurcated and accounted for separately from the Notes.

The qualifying change of control derivative is treated as a liability, initially measured at fair value with subsequent changes in fair value recorded in earnings.

Management utilized a discounted cash flow model to determine the fair value of the qualifying change of control derivative, with the following key assumptions:

• Probability :

The Company utilized a range between 0 % and 5 % to estimate the likelihood of occurrence.

Based on the time period of the feature, 0.7 years.

• Credit Adjusted Discount Rate :

The Company estimated a market-based discount rate of 25.0 %.

Based on the discounted cash flow model, the Company determined the fair value of the qualifying change of control redemption provision as of November 6, 2019 to be $ 1.2 million.

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In determining the amount to be recognized as an issuance discount of the Notes, the Company compared the fair value of the make-whole change of control redemption option of $ 2.2 million as of November 6, 2019 to the combined value of the make-whole and qualifying change of control redemption options immediately after the modification.

The combined value of both redemption options after modification was $ 2.8 million.

The difference in fair value of $ 0.6 million is combined with the existing unamortized discount of the Notes on the modification date and is amortized to interest expense over the remaining term of the modified debt.

The Company recorded an additional $ 0.6 million in derivative liabilities due to this modification.

The qualifying change of control redemption derivative liability expired on August 5, 2020.

The balance of the Notes as of December 31, 2020 and December 31, 2019 was as follows:

December 31, 2020

(In thousands, except interest rates) Stated Interest Rate Effective Interest Rate Face Value Issuance Discount Deferred Financing Costs Net Carrying Value

Initial Notes, due January 16, 2022 12.0 % 18.8 % $ 153,500 $ ( 8,200 ) $ ( 1,523 ) $ 143,777

Option Notes, due January 16, 2022 12.0 % 14.9 % 50,500 ( 1,298 ) ( 84 ) 49,118

Total $ 204,000 $ ( 9,498 ) $ ( 1,607 ) $ 192,895

December 31, 2019

(In thousands, except interest rates) Stated Interest Rate Effective Interest Rate Face Value Issuance Discount Deferred Financing Costs Net Carrying Value

Initial Notes, due January 16, 2022 12.0 % 18.8 % $ 153,500 $ ( 14,703 ) $ ( 2,706 ) $ 136,091

Option Notes, due January 16, 2022 12.0 % 14.9 % 50,500 ( 2,365 ) ( 151 ) 47,984

Total $ 204,000 $ ( 17,068 ) $ ( 2,857 ) $ 184,075

Due to the interest rate reset feature of the Notes, the potential future cash flows associated with the Notes were variable prior to the final interest rate reset on February 1, 2021.

Accordingly, the accretion schedule of debt discount and the amortization schedule of deferred financing costs were updated annually to reflect periodic changes in the future cash flows using the effective interest rate on a prospective basis.

The Company amortized $ 1.2 million in deferred financing costs and accreted $ 7.6 million in issuance discount related to the total outstanding long-term debt during the year ended December 31, 2020.

The Company amortized $ 1.1 million in deferred financing costs and accreted $ 6.2 million in issuance discount related to the total outstanding long-term debt during the year ended December 31, 2019.

The estimated fair value of the Notes, using Level 3 inputs based on interest rates available for debt with terms and maturities similar to the Company's outstanding debt, was $ 191.8 million as of December 31, 2020.

Potential Rights Offering

Under the January 16, 2018 agreements with Starboard, the Company has the right to conduct a rights offering (the "Rights Offering") for up to $ 150.0 million in senior secured convertible notes (the "Rights Offering Notes").

Subject to the terms of the Rights Offering, if undertaken, the Company would distribute to all of the Company's stockholders rights to acquire Rights Offering Notes.

Stockholders who elect to participate in the Rights Offering could elect to have up to 30 % of the Rights Offering Notes they acquire pursuant thereto delivered through the sale to or exchange with the Company of shares of Common Stock, with the per share value thereof equal to the closing price of the Common Stock on the last trading day immediately prior to the commencement of the Rights Offering.

The Rights Offering Notes would be substantially similar to the Notes, except, among other things, with respect to:

(i) the date from which interest thereon would begin to accrue and the maturity date thereof (which would be 4 years from the date of issuance of the Rights Offering Notes) and (ii) the conversion price thereof, which would be equal to 130 % of the closing price of the Common Stock on the last trading day immediately prior to the commencement of the Rights Offering (subject to a conversion price floor of $ 28.00 per share).

Starboard also agreed to enter into one or more backstop commitment agreements, pursuant to which Starboard would backstop up to $ 100.0 million in aggregate principal amount of Rights Offering Notes through the purchase of additional Notes, with such backstop obligation reduced by the amount of Option Notes purchased ($ 50.0 million).

The Company is not obligated to undertake the Rights Offering, and the Company does not intend to do so.

Guarantee and Security of Notes

The Notes are guaranteed by certain of the Company's direct and indirect wholly-owned domestic subsidiaries (the "Guarantors") and are secured by a security interest in substantially all of the assets of the Company and the Guarantors, pursuant to a Guaranty, dated as

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of January 16, 2018, entered into by the Guarantors, and a Pledge and Security Agreement, dated as of January 16, 2018, among the Company, the Guarantors and Starboard Value and Opportunity Master Fund Ltd.

as collateral agent.

Registration of Underlying Shares

Pursuant to the Registration Rights Agreement with Starboard, the Company filed a registration statement on Form S-1 with the SEC allowing for the resale of the shares of Common Stock underlying the Notes, potential PIK Interest Shares, and warrants.

In conjunction with this registration, WPP exercised its right to have its shares of Common Stock included in the registration statement.

The registration statement on Form S-1 was declared effective as of October 16, 2018.

For additional information, refer to Footnote 13 , Related Party Transactions .

On May 28, 2019, the Company filed a registration statement on Form S-3 with the SEC allowing for the resale of additional shares of Common Stock underlying the Notes and potential PIK Interest Shares.

The previously filed registration statement on Form S-1 was amended to convert into a registration statement on Form S-3, and the amendment was declared effective as of June 24, 2019.

Issuance of Secured Term Note

On December 31, 2019, the Company's wholly owned subsidiary, Rentrak B.V., entered into an agreement with the Noteholder for the Secured Term Note for aggregate gross proceeds of $ 13.0 million.

The Secured Term Note, which is cash collateralized, matures on December 31, 2021 and has an annual interest rate of 9.75 %.

Interest is payable in arrears on the last business day of each calendar month commencing on January 31, 2020.

As described in Footnote 1 , Organization, and Footnote 16 , Subsequent Events, on March 9, 2021, the Company's stockholders approved the Transactions, and upon closing of the Transactions, the Company expects to repay the Secured Term Note prior to maturity.

The Secured Term Note contains certain affirmative and restrictive covenants with which Rentrak B.V.

must comply, including (i) maintenance of a minimum cash collateral balance of $ 14.8 million, (ii) provision of certain financial statements, (iii) limitations on additional indebtedness and liens, (iv) limitations on repayment of debt, (v) limitations on repurchase of stock, and (vi) limitations on disposition of assets.

is in compliance with the Secured Term Note covenants as of December 31, 2020.

December 31, 2020

(In thousands, except interest rates) Stated Interest Rate Effective Interest Rate Face Value Deferred Financing Costs Net Carrying Value

Secured Term Note 9.75 % 12.8 % $ 13,000 $ ( 356 ) $ 12,644

December 31, 2019

(In thousands, except interest rates) Stated Interest Rate Effective Interest Rate Face Value Deferred Financing Costs Net Carrying Value

Secured Term Note 9.75 % 12.2 % $ 13,000 $ ( 537 ) $ 12,463

The Company amortized $ 0.3 million in deferred financing costs related to the Secured Term Note during the year ended December 31, 2020.

The estimated fair value of the Secured Term Note, using Level 2 inputs based on interest rates available for debt with terms and maturities similar to the Company's outstanding debt, was $ 13.4 million as of December 31, 2020.

The Secured Term Note contains a redemption provision whereby, upon the occurrence of certain fundamental transactions, a holder would have the right to require the Company to redeem the Secured Term Note for cash at a price equal to (i) the entire outstanding principal amount, (ii) any accrued and unpaid interest, and (iii) a premium equal to the remaining contractual interest cash flows (the "interest make-whole redemption").

Management evaluated this interest make-whole redemption feature and determined it represented an embedded derivative that must be bifurcated and accounted for separately from the Secured Term Note.

The interest make-whole derivative is treated as a liability, initially measured at fair value with subsequent changes in fair value recorded in earnings.

The estimated fair value of the interest make-whole derivative was determined to be negligible as of December 31, 2019.

The estimated fair value of the interest make-whole derivative as of December 31, 2020 was $ 0.9 million.

Refer to Footnote 6 , Fair Value Measurements , for further information.

Standby Letters of Credit

In 2018, the Company entered into a Security Agreement with Wells Fargo Bank, N.A.

to issue standby letters of credit.

As of December 31, 2020, $ 3.3 million in letters of credit are outstanding and are cash collateralized under the Security Agreement.

Convertible Redeemable Preferred Stock and Stockholders' Equity

2021 Issuance of Preferred Stock

On March 10, 2021 (the "Closing Date"), the Company entered into separate Securities Purchase Agreements with each of Charter Communications Holding Company, LLC ("Charter"), Qurate Retail, Inc.

("Qurate") and Pine Investor, LLC ("Pine") (the "Securities Purchase Agreements").

At the closing of the Transactions, the Company issued and sold (a) to Charter, 27,509,203 shares of Preferred Stock in exchange for $ 68.0 million, (b) to Qurate, 27,509,203 shares of Preferred Stock in exchange for $ 68.0 million and (c) to Pine, 27,509,203 shares of Preferred Stock in exchange for $ 68.0 million.

The shares were issued at a par value of $ 0.001 .

Net proceeds from the Transactions totaled $ 187.9 million after deducting issuance costs.

The Transactions and related agreements include the following rights:

Registration Rights

On the Closing Date, the Company entered into a Registration Rights Agreement (the "RRA") with the holders of the Preferred Stock (together with any other party that may become a party to the RRA), pursuant to which, among other things, and on the terms and subject to certain limitations set forth therein, the Company was obligated to file a registration statement registering the sale or distribution of shares of Preferred Stock or Common Stock held by any holder, including any shares of Common Stock acquired by any holder pursuant to the conversion of the Preferred Stock, and any other securities issued or issuable with respect to any such shares of Common Stock or Preferred Stock by way of share split, share dividend, distribution, recapitalization, merger, exchange, replacement or similar event or otherwise (the "Registrable Securities").

In addition, pursuant to the RRA, the holders have the right to require the Company, subject to certain limitations, to effect a sale of any or all of their Registrable Securities by means of an underwritten offering or an underwritten block trade or bought deal.

On August 30, 2021, the Company filed a registration statement on Form S-3 with respect to the Registrable Securities.

The registration statement on Form S-3 became effective on September 21, 2021.

Conversion Provisions

The Preferred Stock is convertible at the option of the holders at any time into a number of shares of Common Stock based on a conversion rate set in accordance with the Certificate of Designations of the Preferred Stock.

The conversion rate is calculated as the product of (i) the conversion factor and (ii) the quotient of (A) the sum of the initial purchase price and accrued dividends with respect to each share of Preferred Stock divided by (B) the initial purchase price.

The conversion right is subject to certain anti-dilution adjustments and customary provisions related to partial dividend periods.

As of December 31, 2021, each share of Preferred Stock was convertible into 1.038542 shares of Common Stock.

At any time after the fifth anniversary of the Closing Date, the Company may elect to convert all of the outstanding shares of Preferred Stock into shares of Common Stock if (i) the closing sale price of the Company's Common Stock is greater than 140 % of the conversion price as of such time, as may be adjusted pursuant to the Certificate of Designations, for certain periods, and (ii) the pro rata share of an aggregate of $ 100.0 million in dividends has been paid with respect to each share of Preferred Stock that was outstanding on the Closing Date and remains outstanding.

As of December 31, 2021, no shares of Preferred Stock have been converted into Common Stock.

Voting Rights

The holders of the Preferred Stock are entitled to vote as a single class with the holders of the Common Stock, with a vote equal to the number of shares of Common Stock into which the Preferred Stock could be converted, except that the conversion rate for this purpose will be equal to the product of the applicable conversion factor and 0.98091271 .

Each holder of Preferred Stock is subject to a voting threshold, which limits such holder's voting rights in the event that the holder's Preferred Stock represents voting rights that exceed 16.66 % of the Company's Common Stock (including the Preferred Stock on an as-converted basis).

Dividend Rights

The holders of Preferred Stock are entitled to participate in all dividends declared on the Common Stock on an as-converted basis and are also entitled to a cumulative dividend at the rate of 7.5 % per annum, payable annually in arrears (on June 30 of each year) and subject to increase under certain specified circumstances.

The annual dividend accrues on a daily basis from and including the issuance date of such shares, whether or not declared.

In the event the annual dividends are not paid in cash on the annual payment date, the dividends otherwise payable on such date shall continue to accrue and cumulate at a rate of 9.5 % per annum, until such failure is cured.

In addition, after January 1, 2022, the holders of Preferred Stock are entitled to request, and the Company will take all actions reasonably necessary to pay, a one-time dividend ("Special Dividend") equal to the highest dividend that the Company's Board determines can be paid at the applicable time (or a lesser amount agreed upon by the holders), subject to additional conditions and limitations set forth in a Stockholders Agreement entered into by the Company and the holders on the Closing Date (the "Stockholders Agreement").

As set forth in the Stockholders Agreement, the Company may be obligated to obtain debt financing in order to effectuate the Special Dividend.

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Failed Sale-Leaseback Transaction

In June 2019, the Company entered into a sale-leaseback arrangement with a vendor to provide $ 4.3 million in cash proceeds for previously acquired computer and other equipment.

The arrangement is repayable over a 24 -month term for total consideration of $ 4.8 million, with control of the equipment transferring to the vendor at the end of the leaseback term.

The Company concluded the leaseback would be classified as a financing lease.

Therefore, the transaction was deemed a failed sale-leaseback and was accounted for as a financing arrangement.

The assets continue to be depreciated over their useful lives, and payments are allocated between interest expense and repayment of the financing liability.

The remaining financing obligation of $ 1.7 million is included within current liabilities on the Consolidated Balance Sheet.

Remaining future minimum cash payments related to the financing obligations under the failed sale-leaseback transaction total $ 1.4 million as of December 31, 2020 and will be paid during the first half of 2021.

Stockholders' Equity

On June 30, 2021, in accordance with the Certificate of Designations of the Preferred Stock, the Company paid cash dividends totaling $ 4.8 million to the holders of the Preferred Stock, representing dividends accrued for the period from the Closing Date through June 29, 2021.

The next scheduled dividend payment date for the Preferred Stock is June 30, 2022.

For the year ended December 31, 2021, dividends to holders of the Preferred Stock, including those both paid and accrued, totaled $ 12.6 million.

Anti-Dilution Adjustments

The Preferred Stock is subject to anti-dilution adjustment upon the occurrence of certain events, including issuance of certain dividends or distributions to holders of Common Stock, split or combination of Common Stock, reclassification of Common Stock into a greater or lesser number of shares, or certain repurchases of Common Stock, subject to limitations set forth in the Certificate of Designations.

Liquidation Preference and Change of Control Provisions

The Preferred Stock ranks senior to the Common Stock with respect to dividend rights and rights on the distribution of assets in the event of a liquidation, dissolution or winding up of the affairs of the Company, and ranks junior to secured and unsecured indebtedness.

The Preferred Stock has a liquidation preference equal to the higher of (i) the initial purchase price, increased by accrued dividends per share, and (ii) the amount per share of Preferred Stock that a holder would have received if such holder, immediately prior to such liquidation, dissolution or winding up of the affairs of the Company, converted such share into Common Stock.

The Preferred Stock includes a change of control put option which allows the holders of the Preferred Stock to require the Company to repurchase such holders' shares at a purchase price equal to the initial purchase price, increased by accrued dividends.

The change of control put option was determined to be a derivative liability under ASC 815, Derivatives and Hedging .

As of December 31, 2021, the probability of a change of control was determined to be remote, and the fair value of the change of control derivative was determined to be negligible.

To the extent the holders of the Preferred Stock do not exercise the put option in a covered change of control, the Company has the right to redeem the remaining Preferred Stock at a redemption price equal to the initial purchase price, increased by accrued dividends.

As described above, the Preferred Stock is contingently redeemable upon certain deemed liquidation events, such as a change in control.

2019 Issuance and Sale of Common Stock and Warrants

On June 23, 2019, the Company entered into a Securities Purchase Agreement (the "Purchase Agreement") with CVI, pursuant to which CVI agreed to purchase (i) 2,728,513 shares of Common Stock (the "Initial Shares"), at a price of $ 7.33 per share and (ii) Series A Warrants, Series B-1 Warrants, Series B-2 Warrants and Series C Warrants, for aggregate gross proceeds of $ 20.0 million (the "Private Placement").

The Private Placement closed on June 26, 2019 (the "Closing Date").

The Series B-1 Warrants were exercisable by the holders at any time prior to the six-month anniversary of the Closing Date, as adjusted pursuant to the terms of the Series B-1 Warrants.

The Series B-1 Warrants provided the holders the right to purchase an aggregate of up to 2,347,418 shares of Common Stock at an exercise price equal to $ 8.52 and could have been exercised for cash only.

The Series B-1 Warrants expired on January 29, 2020.

The Series B-2 Warrants were exercisable by the holders at any time prior to the 12-month anniversary of the Closing Date, as adjusted pursuant to the terms of the Series B-2 Warrants.

The Series B-2 Warrants provided the holders the right to purchase an aggregate of up to 1,121,076 shares of Common Stock at an exercise price equal to $ 8.92 and could have been exercised for cash only.

The Series B-2 Warrants expired on August 3, 2020.

The Series C Warrants were partially prepaid warrants (with a nominal remaining exercise price) that were not exercisable before September 21, 2019 and expire 90 days after the first anniversary of the Closing Date.

CVI exercised the Series C Warrants on October 10, 2019.

Because the VWAP of the Common Stock as of the date of exercise, discounted by 7.5 %, was less than CVI's purchase price for the Initial Shares, the Company was required to issue to CVI a number of shares of Common Stock equal to (i) (x) CVI's purchase price for the Initial Shares divided by (y) 92.5 % of the VWAP of the Common Stock leading up to September 21, 2019, subject to a floor of 50.0 % of the price per Initial Share, less (ii) the number of Initial Shares issued to CVI on the Closing Date.

On June 23, 2019, the Company entered into a Securities Purchase Agreement with CVI Investments, Inc.

("CVI"), pursuant to which CVI agreed to purchase (i) 2,728,513 shares of Common Stock (the "Initial Shares"), at a price of $ 7.33 per share and (ii) Series A Warrants, Series B-1 Warrants, Series B-2 Warrants and Series C Warrants, for aggregate gross proceeds of $ 20.0 million (the "Private Placement").

The Private Placement closed on June 26, 2019 (the "CVI Closing Date").

The Series B-1 Warrants and Series B-2 Warrants expired during 2020.

The Series C Warrants were exercised on October 10, 2019.

As a result of this exercise, the Company issued 2,728,513 shares of Common Stock to CVI on October 14, 2019.

In addition, the number of shares issuable under the Company's Series A Warrants was increased by 2,728,513 .

The Series A Warrants are exercisable for a period of five years from the Closing Date and are currently exercisable into 5,457,026 shares of Common Stock, which is equal to the Initial Shares plus the number of shares issued pursuant to the exercise of the Series C Warrants (described above).

The exercise price for the Series A Warrants is $ 12.00 .

In addition, the number of shares issuable under the Series A Warrants was increased by 2,728,513 .

The Series A Warrants are exercisable by the holders for a period of five years from the CVI Closing Date and are currently exercisable into 5,457,026 shares of Common Stock, which is equal to the Initial Shares plus the number of shares issued pursuant to the exercise of the Series C Warrants (described above).

The exercise price for the Series A Warrants was $ 12.00 upon issuance but was subsequently adjusted, as described below.

The Series A Warrants may be exercised for cash or through a net settlement feature under certain circumstances.

The exercise price for the Series A Warrants is subject to anti-dilution adjustment in certain circumstances.

Refer to Footnote 16 , Subsequent Events , for further information.

In addition, if and to the extent the exercise of any warrants would, together with the issuances of the Initial Shares and the shares issued pursuant to the exercise of any other warrants, result in the issuance of 20.0 % or more of the outstanding Common Stock of the Company on the Closing Date (the "Exchange Cap"), the Company intends to, in lieu of issuing such shares, settle the obligation to issue such shares in cash.

In addition, CVI will not have the right to exercise any warrants that would result in CVI beneficially owning more than 4.99 % of the outstanding Common Stock after giving effect to such exercise.

The exercise price for the Series A Warrants is subject to anti-dilution adjustment in certain circumstances, including upon certain issuances of capital stock.

Upon the issuance of the Preferred Stock, the Company adjusted the exercise price of the Series A Warrants from $ 12.00 to $ 2.4719 per share, the closing price of the Transactions.

CVI will not have the right to exercise any warrant that would result in CVI beneficially owning more than 4.99 % of the outstanding Common Stock after giving effect to such exercise.

CVI has the right, in its discretion, to raise this threshold up to 9.99 % with 60 days' notice to the Company.

Pursuant to the transactions described above, the Company agreed to provide CVI with registration rights relating to the Initial Shares and any shares issuable upon the exercise of the warrants.

On June 26, 2019, the Company filed a prospectus supplement to its effective registration statement on Form S-3 to permit the resale of such shares.

Management determined each warrant to be a freestanding financial instrument that qualifies for liability treatment as a result of the net cash settlement feature associated with the Exchange Cap provision.

Each warrant is initially measured at fair value and classified as a current liability on the Consolidated Balance Sheets, with subsequent changes in fair value recorded in earnings.

To determine the fair value of each warrant, management utilized a Monte Carlo simulation analysis within an option pricing model using the following key assumptions as of the Closing Date:

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• Stock price :

Measured using the fair value of the Common Stock on the Closing Date, which was $ 5.57 per share.

• Volatility :

The Company determined volatility to be 50.0 % based on (i) the historical volatility of the Common Stock daily volume weighted average price with a look-back period commensurate with the term of the warrants and (ii) options-based implied volatility.

Management determined the term based on the time period of each warrant's maturity, between six months and five years from the Closing Date.

• Change of control probability :

The Company utilized a range between 0.0 % and 10.0 % to estimate the likelihood of occurrence.

• Risk-free rate :

Management assumed the risk-free rate to be between 1.7 % and 2.1 %, based on the U.S.

Treasury bonds on the valuation date with terms commensurate with the terms of each warrant.

• Cost of debt :

Management assumed the cost of debt to be between 16.7 % and 18.7 % based on a synthetic credit rating analysis.

• Dividend yield :

Management assumed the dividend yield to be zero based on the historical payout of the Company.

Certain estimates above represent Level 3 inputs within the fair value hierarchy.

Based on the option pricing valuation model, the Company determined the fair value of the warrants as of the Closing Date to be the following:

(in thousands) Warrants Liability

Series A Warrants $ 3,862

Series B-1 Warrants (1)

Series B-2 Warrants (2)

Series C Warrants (3)

Total $ 10,798

1) Series B-1 Warrants expired on January 29, 2020.

2) Series B-2 Warrants expired on August 3, 2020.

3) Series C Warrants were exercised on October 10, 2019.

The Company recorded $ 1.8 million in accrued transaction costs in 2019, of which approximately $ 0.8 million was allocated to the warrants liability and recorded in general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Loss.

The remaining transaction costs of $ 1.0 million were recorded in additional paid-in capital in the Consolidated Balance Sheets.

In addition, if and to the extent the exercise of any warrants would, together with the issuances of the Initial Shares and the shares issued pursuant to the exercise of any other warrants, result in the issuance of 20.0 % or more of the outstanding Common Stock of the Company on the CVI Closing Date (the "Exchange Cap"), the Company intends to, in lieu of issuing such shares, settle the obligation to issue such shares in cash.

The estimated fair value of the warrants as of December 31, 2021 was $ 10.5 million.

Refer to Footnote 7 , Fair Value Measurements , for further information.

2013 Stock Option/Issuance Plan

On December 16, 2021, the Company assumed certain equity awards outstanding under the Shareablee, Inc.

2013 Stock Option/Stock Issuance Plan (the "2013 Plan") in connection with the acquisition of Shareablee described in Footnote 3 , Business Combination .

Under the 2013 Plan, as amended and restated, the Company may grant to certain eligible participants option rights and restricted stock units up to 4,500,000 shares of Shareablee common stock.

These shares are converted into shares of the Company's Common Stock at a conversion rate of one Shareablee share to 0.330437 shares of the Company.

The aggregate number of shares of Common Stock available will be reduced by one share of Common Stock for every one share of Common Stock subject to an award granted under the 2013 Plan.

If any award granted under the 2013

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Plan (in whole or in part) is cancelled or forfeited, expires, is unvested and repurchased in cash, or otherwise unearned, the shares of Common Stock subject to such award will, to the extent of such cancellation, forfeiture, expiration, or repurchase in cash, again be available at a rate of one share of Common Stock for every one share of Common Stock subject to such award.

The Company registered the securities issuable under the 2013 Plan with the SEC on December 23, 2021.

The maximum number of shares of the Company's Common Stock available for future issuance under the 2013 Plan as of December 31, 2021 (excluding outstanding awards) is 167,750 .

2018 Equity and Incentive Compensation Plan

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The Company's Compensation Committee approved and awarded 50,000 and 925,000 options for the years ended December 31, 2020 and 2019, respectively, under the 2018 Plan to employees and consultants.

No options were approved and awarded for the year ended December 31, 2018.

The fair value of options at date of grant was estimated using the Black-Scholes option pricing model utilizing the following assumptions:

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No options were approved and awarded for the year ended December 31, 2021 under the 2018 Plan.

On December 16, 2021, the Company assumed all outstanding stock options to purchase shares of Shareablee common stock as part of the Merger.

Each assumed Shareablee stock option was converted into 0.330437 stock options of the Company, rounded up to the nearest whole option, resulting in 1,006,383 stock options of the Company.

The as-converted exercise price per share for assumed Shareablee stock options is equal to the original exercise price per share of the Shareablee options divided by 0.330437 , with such quotient rounded up to the nearest whole cent.

Each assumed Shareablee stock option is otherwise subject to the same terms and conditions (including vesting and exercisability) as were applicable under the respective Shareablee stock option immediately prior to the Merger.

The fair values of options at the date of grant, or when assumed by the Company, were estimated using the Black-Scholes option pricing model utilizing the following assumptions:

Years Ended December 31,

2021 2020 2019

Dividend yield (1)

0.0 % 0.0 % 0.0 %

Expected volatility (2)

33.2 % - 72.4 %

57.0 % 44.5 % - 52.9 %

Risk-free interest rate (3)

0.1 % - 1.4 %

1.0 % 1.3 % - 2.7 %

Expected life of options (in years) (4)

Dividend yield — The Company has never declared or paid a cash dividend on its Common Stock and has no plans to pay cash dividends in the foreseeable future.

Expected volatility — Volatility is a measure of the amount by which a financial variable such as a share price has fluctuated (historical volatility) or is expected to fluctuate (expected volatility) during a period.

6.00 5.21 - 10.00

(1) The Company has never declared or paid a cash dividend on its Common Stock and has no plans to pay cash dividends on Common Stock in the foreseeable future.

(2) Volatility is a measure of the amount by which a financial variable such as a share price has fluctuated (historical volatility) or is expected to fluctuate (expected volatility) during a period.

The Company considered the historical volatility of its stock price over a term similar to the expected life of the options in determining expected volatility.

Risk-free interest rate — The Company used rates on the grant date of zero-coupon government bonds with maturities over periods covering the term of the awards, converted to continuously compounded forward rates.

Expected life of the options — This is the period of time that the options granted are expected to remain outstanding.

Options under the Company's plans generally have a contractual term of 10 years and generally must be exercised within 90 days following employee termination.

A summary of the options granted, exercised, forfeited and expired during the years ended December 31, 2020, 2019 and 2018 is presented below:

(3) The Company used rates on the grant date of zero-coupon government bonds with maturities over periods covering the term of the awards, converted to continuously compounded forward rates.

(4) This is the period of time that the options granted are expected to remain outstanding.

Options under the Company's plans generally have a contractual term of 10 years and generally must be exercised within 30 to 90 days following termination of service.

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A summary of options granted, exercised, forfeited and expired during the years ended December 31, 2021, 2020 and 2019 is included below:

Shares Weighted-Average

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Options outstanding as of December 31, 2018 1,045,913 $ 17.89

Options exercised (1)

( 347,752 ) 15.45

Options expired ( 2,050,587 ) 39.74

Options outstanding as of December 31, 2018 1,045,913 $ 17.89

Options granted 925,000 5.64

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Options outstanding as of December 31, 2020 997,192 $ 9.82

Options assumed (1)

Options expired ( 203,006 ) 14.83

Options outstanding as of December 31, 2021 1,783,055 $ 4.45

Options exercisable as of December 31, 2021 778,790 $ 7.29

(1) Includes 125,523 options withheld to pay the exercise price for certain exercises during the year ended December 31, 2018.

(1) Excludes 17,514 stock options which will be settled in cash in lieu of the issuance of Common Stock of the Company.

The following table summarizes information about options outstanding, and exercisable, as of December 31, 2021:

13 unchanged sentences

6,057 40.80 2.62 6,057 40.80 2.62

1,783,055 $ 4.45 6.57 778,790 $ 7.29 5.46

The intrinsic value of exercised stock options is calculated based on the difference between the exercise price and the quoted market price of the Company's Common Stock as of the close of the exercise date.

The aggregate intrinsic value for options exercised was $ 0.1 million, $ 0.3 million and $ 1.5 million for the years ended December 31, 2020, 2019 and 2018, respectively.

There was no intrinsic value for options exercisable or outstanding as of December 31, 2020.

The aggregate intrinsic value for all options exercisable was $ 0.2 million and $ 0.7 million under the Company's stock plans as of December 31, 2019 and 2018, respectively.

The aggregate intrinsic value for all options outstanding was $ 0.9 million and $ 0.7 million under the Company's stock plans as of December 31, 2019 and 2018, respectively.

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The aggregate intrinsic value for options exercised was zero , $ 0.1 million and $ 0.3 million for the years ended December 31, 2021, 2020 and 2019, respectively.

The aggregate intrinsic value for all options exercisable was $ 0.5 million, zero and $ 0.2 million under the Company's stock plans as of December 31, 2021, 2020 and 2019, respectively.

The aggregate intrinsic value for all options outstanding was $ 2.2 million, zero and $ 0.9 million under the Company's stock plans as of December 31, 2021, 2020 and 2019, respectively.

As of December 31, 2021, the total unrecognized compensation expense related to outstanding, but not yet exercisable, options is $ 1.2 million, which the Company expects to recognize over a weighted-average vesting period of approximately 2.1 years.

The Company's outstanding stock awards are comprised of RSUs, including time-based, performance-based and market-based RSUs.

During 2021, the Company's Compensation Committee (or Board of Directors, as applicable) approved and awarded 2,464,694 time-based RSUs (of which 1,413,290 RSUs related to the settlement of an accrued 2020 annual incentive plan liability and vested immediately) and 2,127,920 performance-based RSUs under the 2018 Plan to employees and directors of the Company.

The performance-based RSUs pertained to awards approved by our Board of Directors as part of the Transactions on January 7, 2021, which awards included the closing of the Transactions as an implied performance condition.

Of these performance-based RSUs, 772,686 vested immediately upon the closing of the Transactions.

The remaining performance-based RSUs generally vest after one to three years contingent on continued service.

On December 16, 2021, the Company assumed all outstanding RSUs representing the right to receive shares of Shareablee common stock as part of the Merger.

Each assumed Shareablee RSU was converted into 0.330437 RSUs of the Company, resulting in 55,702 RSUs of the Company.

Each assumed Shareablee RSU is otherwise subject to the same terms and conditions (including as to vesting and issuance) as were applicable under the respective Shareablee RSU immediately prior to the Merger.

During 2020, the Company's Compensation Committee approved and awarded 634,570 time-based RSUs (of which 610,590 RSUs related to the settlement of an accrued 2019 annual incentive plan liability and vested immediately).

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During 2019, the Company's Compensation Committee approved and awarded 1,603,866 time-based RSUs (of which 206,108 RSUs related to the settlement of an accrued 2018 annual incentive plan liability) and 975,000 market-based RSUs, which were valued using a Monte Carlo simulation analysis, to employees, directors and consultants of the Company.

2 unchanged sentences

Market-based awards generally vest over up to ten years based on the achievement of certain stock-price hurdles.

During 2018, the Company's Compensation Committee approved and awarded 2,612,457 time-based RSUs, 191,800 performance-based RSUs and 68,151 market-based RSUs under the 2018 Plan to employees, directors and consultants of the Company.

Of the time-based RSUs, 1,493,288 vested immediately upon grant, including 165,086 shares related to the compensation of the Company's former CEO as part of his retirement and transition services agreement.

The remaining time-based RSUs generally vest after three to four years contingent on continued service, and performance-based RSUs generally vest after three years based on achievement of pre-established revenue and adjusted earnings before interest income, interest expense, income taxes, depreciation and amortization (Adjusted EBITDA) goals.

Market-based awards generally vest after three years based on the attainment of certain stock price hurdles.

The estimated forfeiture rate as of December 31, 2020, 2019 and 2018 was 10.0 % for non-executive awards.

Awards granted to senior executives have an estimated forfeiture rate of zero .

Changes in the estimates and assumptions relating to forfeitures and subsequent grants may result in material changes to stock-based compensation expense in the future.

A summary of the stock awards granted, vested and forfeited during the years ended December 31, 2021, 2020 and 2019 is presented as follows.

13 unchanged sentences

Granted 4,592,614 3.13

Assumed 55,702 3.14

Vested ( 2,362,963 ) 4.68

3 unchanged sentences

As of December 31, 2021, total unrecognized compensation expense related to unvested RSUs was $ 5.4 million, which the Company expects to recognize over a weighted-average vesting period of approximately 3.4 years.

Preferred Stock

The Company has 5,000,000 shares of $ 0.001 par value preferred stock authorized;

no shares have been issued or were outstanding as of December 31, 2020 and 2019.

Refer to Footnote 16 , Subsequent Events .

Senior Secured Convertible Notes and Financing Derivatives

During 2018, the Company entered into certain agreements with funds affiliated with or managed by Starboard Value LP (collectively, "Starboard"), pursuant to which the Company issued and sold to Starboard a total of $ 204.0 million in Notes, which initially accrued interest at 6.0 %, as well as warrants to purchase shares of the Company's Common Stock, par value $ 0.001 per share, in exchange for $ 100.0 million in cash and 4,000,000 shares of Common Stock.

The warrants were exercised in full by Starboard on April 3, 2019 for 323,448 shares of Common Stock.

The Notes contained, among other features, an interest rate reset feature which the Company determined represented an embedded derivative that must be bifurcated and accounted for separately from the Notes.

This feature reset the interest rate on the Notes based on the trading price of the Company's Common Stock.

In January 2019, the interest rate reset to 12.0 % where it was scheduled to remain through the contractual maturity of the Notes on January 16, 2022.

Interest on the Notes was payable on a quarterly basis in arrears, at the option of the Company, in cash, or, subject to certain conditions, through the issuance by the Company of additional shares of Common Stock ("PIK Interest Shares").

On January 25, 2021, the Company paid quarterly accrued interest of $ 6.1 million through the issuance of 2,802,454 PIK Interest Shares.

The interest paid was classified within other non-current liabilities in the Consolidated Balance Sheets as of December 31, 2020.

In connection with the Transactions described in Footnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity , the Company used cash proceeds of $ 204.0 million from the issuance of shares of its Preferred Stock to extinguish the Notes and related financing derivatives on March 10, 2021.

The Company also issued 3,150,000 additional shares to Starboard (the "Conversion Shares"), as additional creditor consideration, which were valued at $ 9.6 million based on the $ 3.05 closing price of the Company's Common Stock on March 9, 2021.

Lastly, the Company paid interest accrued of $ 4.7 million for the period from January 1, 2021 to March 10, 2021 through the issuance of 1,363,327 PIK Interest Shares.

The Company adjusted the interest rate reset feature to its fair value on March 10, 2021 immediately prior to extinguishment.

The fair value of the interest reset derivative was estimated to be $ 9.5 million using a discounted cash flow method based on projected incremental cash flows

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through contractual maturity of the Notes and a credit-adjusted discount rate of 20.0 %.

The fair value of other financing derivatives embedded within the Notes was determined to be negligible.

The Company recorded a loss on extinguishment of the Notes of $ 9.3 million for the three months ended March 31, 2021.

The loss was comprised of a write-off of unamortized deferred financing costs and issuance discount of $ 9.2 million and issuance of Conversion Shares of $ 9.6 million, offset by the derecognition of the interest rate reset derivative liability valued at $ 9.5 million.

Secured Term Note

On December 31, 2019, the Company's wholly owned subsidiary, Rentrak B.V., entered into an agreement with several third parties for the Secured Term Note in exchange for gross proceeds of $ 13.0 million.

The Secured Term Note was scheduled to mature on December 31, 2021, was cash collateralized, and had an annual interest rate of 9.75 % that was payable monthly in arrears.

The Secured Term Note included a redemption feature which, upon the occurrence of certain fundamental transactions, would require the Company to redeem the Secured Term Note in full, plus accrued interest, and remit a prepayment premium equal to the remaining contractual interest cash flows (the "interest make-whole redemption").

The Company determined this feature represented an embedded derivative that must be bifurcated and accounted for separately from the Secured Term Note.

In connection with the Transactions described in Footnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity , the Company used restricted cash from its balance sheet to extinguish the Secured Term Note and interest make-whole redemption on March 10, 2021, of which $ 13.0 million and $ 1.0 million were for principal repayments and settlement of the interest make-whole redemption, respectively.

The Company recorded a loss on extinguishment of the Secured Term Note of $ 0.3 million for the three months ended March 31, 2021.

The loss was due to the write-off of unamortized deferred financing costs.

Changes in the fair value of the interest make-whole redemption were recorded to other (expense) income, net and settlement did not impact loss on debt extinguishment.

Revolving Credit Agreement

On May 5, 2021, the Company entered into a senior secured revolving credit agreement (the "Revolving Credit Agreement") among the Company, as borrower, certain subsidiaries of the Company, as guarantors, Bank of America N.A., as administrative agent (in such capacity, the "Agent"), and the lenders from time-to-time party thereto.

The Revolving Credit Agreement has a maturity of three years from the closing date of the agreement.

As of December 31, 2021, the Revolving Credit Agreement provided a borrowing capacity equal to $ 25.0 million.

The Company may also request the issuance of letters of credit under the Revolving Credit Agreement in an aggregate amount up to $ 5.0 million, which reduces the amount of available borrowings by the amount of such issued and outstanding letters of credit.

The amount the Company is able to borrow is subject to compliance with the financial covenants, satisfaction of various conditions precedent to borrowing and other provisions of the Revolving Credit Agreement.

During the year ended December 31, 2021, borrowings under the Revolving Credit Agreement were made at the Eurodollar Rate and bore interest at a rate per annum equal to the Eurodollar Rate (as defined in the Revolving Credit Agreement) plus an applicable rate equal to 2.25 %.

The Revolving Credit Agreement also provides for an unused commitment fee equal to 0.25 % of the unused commitments at such time.

To the extent that a payment default exists and is continuing, at the election of the Required Lenders (as defined in the Revolving Credit Agreement), all amounts outstanding under the Revolving Credit Agreement will bear interest at 2.00 % per annum above the rate and margin otherwise applicable thereto.

The Company is able to repay any amounts borrowed prior to the maturity date without any premium or penalty other than customary breakage costs.

The Revolving Credit Agreement is guaranteed by the Company and its domestic subsidiaries (other than Excluded Subsidiaries (as defined in the Revolving Credit Agreement)) and is secured by a first lien security interest in substantially all assets of the Company and its domestic subsidiaries (other than Excluded Subsidiaries), subject to certain customary exclusions.

As of December 31, 2021, the Revolving Credit Agreement contained the following financial covenants, including the maintenance of certain financial ratios:

• a minimum Consolidated EBITDA (as defined in the Revolving Credit Agreement) of not less than $ 20.0 million for the most recently ended four fiscal quarter period, tested as of the last day of each fiscal quarter ending before June 30, 2022;

• a minimum Consolidated Fixed Charge Coverage Ratio (as defined in the Revolving Credit Agreement) of not less than 1.25 to 1.0 for the most recently ended four fiscal quarter period, tested as of the last day of each fiscal quarter ending on or after June 30, 2022.

Additionally, the Revolving Credit Agreement contains restrictive covenants that limit the Company's ability to, among other things, incur additional indebtedness, incur additional liens, make investments and loans, enter into mergers and acquisitions, make or declare dividends and other payments, enter into certain contracts, sell assets and engage in transactions with affiliates.

The Revolving Credit Agreement is also subject to customary events of default, including a change in control.

If an event of default occurs and is continuing, the Agent or the Required Lenders may accelerate any amounts outstanding and terminate lender commitments.

The Company is in compliance with the covenants under the Revolving Credit Agreement as of December 31, 2021.

Table of Conte nt s

As of December 31, 2021, the Company had outstanding borrowings of $ 16.0 million, and issued and outstanding letters of credit of $ 3.3 million, under the Revolving Credit Agreement, with remaining borrowing capacity of $ 5.7 million as of December 31, 2021.

On February 25, 2022, the Company amended the Revolving Credit Agreement to expand its aggregate borrowing capacity to $ 40.0 million, which increased the Company's remaining borrowing capacity to $ 20.7 million, and to revise the financial covenants described above.

See Footnote 15 , Subsequent Events for further discussion of this amendment.

Failed Sale-Leaseback Transaction

In June 2019, the Company entered into a sale-leaseback arrangement with a vendor to provide $ 4.3 million in cash proceeds for previously acquired computer and other equipment.

The arrangement is repayable over a 24-month term for total consideration of $ 4.8 million, with control of the equipment transferring to the vendor at the end of the leaseback term.

The leaseback would have been classified as a financing lease.

The transaction was deemed a failed sale-leaseback and was accounted for as a financing arrangement.

Repayments were allocated between interest expense and a reduction of the financing liability, and the assets continued to depreciate over their useful lives.

In June 2021, the Company extended the sale-leaseback arrangement for an additional 24-month term.

The leaseback extension continued to meet the criteria to be accounted for as a financing arrangement.

The present value of cash flows after the extension differed by more than 10% from the present value of the remaining cash flows immediately prior to the extension.

Therefore, the Company concluded the extension should be accounted for as an extinguishment of the existing financing liability.

The fair value of the new financing liability as of June 30, 2021 was $ 0.9 million, which was estimated using an income approach and a discount rate of 7.5 %.

The financing liability is included within other current and other non-current liabilities on the Consolidated Balance Sheet as of December 31, 2021, with $ 0.4 million classified as current and $ 0.3 million classified as non-current.

Remaining future cash payments related to the financing liability under the failed sale-leaseback transaction total $ 0.7 million as of December 31, 2021, and are scheduled to be paid in monthly installments through June 2023.

Fair Value Measurements

The Company's financial instruments measured at fair value in the accompanying Consolidated Balance Sheets on a recurring basis consist of the following:

The Company's financial instruments measured at fair value in its Consolidated Balance Sheets on a recurring basis consist of the following:

December 31, 2021 December 31, 2020

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$ 2,429 $ — $ — $ 2,429 $ 11,928 $ — $ — $ 11,928

Certificates of deposit (2)

Liabilities (2)

Warrants liability (3)

$ — $ — $ 10,520 $ 10,520 $ — $ — $ 2,831 $ 2,831

Total $ 11,928 $ — $ — $ 11,928 $ 24,327 $ 1,009 $ — $ 25,336

Contingent consideration liability (4)

— — 5,600 5,600 — — — —

Financing derivatives (5)

no hedging designation (3)

Interest rate reset $ — $ — $ 11,300 $ 11,300 $ — $ — $ 18,800 $ 18,800

Make-whole change of control — — — — — — 1,600 1,600

Qualifying change of control — — — — — — 1,187 1,187

Warrants issued:

Series A — — 2,831 2,831 — — 7,508 7,508

Series B-2 — — — — — — 217 217

Secured term note:

— — — — — — 11,300 11,300

Interest make-whole derivative (6)

— — — — — — 871 871

Total $ — $ — $ 16,120 $ 16,120 $ — $ — $ 15,002 $ 15,002

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Dollar-denominated money market instruments with maturities less than three months.

(2) The Company's certificates of deposit are recorded at their face value which approximates their fair value.

(3) The fair values of the financing derivatives are derived from techniques which utilize inputs, certain of which are significant and unobservable, that result in classification as Level 3 fair value measurements.

The fair value of the make-whole change of control derivative was estimated as negligible as of December 31, 2020.

The qualifying change of control derivative expired on August 5, 2020.

(4) The fair values of the warrant liabilities are derived from techniques which utilize inputs, certain of which are significant and unobservable, that result in classification as Level 3 fair value measurements.

The fair value of the Series B-1 warrants was estimated as negligible as of December 31, 2019.

The Series B-1 warrants expired without exercise on January 29, 2020.

The Series B-2 Warrants expired without exercise on August 3, 2020.

(5) The fair values of embedded derivatives within the secured term note are derived from techniques which utilize inputs, certain of which are significant and unobservable, that result in classification as Level 3 fair value measurements.

The interest make-whole derivative is classified within other current liabilities in the Consolidated Financial Statements as of December 31, 2020.

(2) The fair values of these liabilities are derived from techniques which utilize inputs, certain of which are significant and unobservable, that result in classification as Level 3 fair value measurements.

(3) Warrants liability includes only the Series A warrants as of December 31, 2021 and 2020.

(4) The contingent consideration was recognized as part of the acquisition described in Footnote 3 , Business Combination .

The current and non-current portions of the contingent consideration are $ 1.0 million and $ 4.6 million, respectively, and are classified within other current and non-current liabilities in the Consolidated Balance Sheets.

(5) Financing derivatives include only the interest rate reset derivative as of December 31, 2020.

The fair value of the make-whole change of control derivative was estimated to be negligible as of December 31, 2020.

Extinguishment of the Notes on March 10, 2021 resulted in derecognition of the interest rate reset and make-whole change of control derivatives.

(6) The interest make-whole derivative is classified within other current liabilities in the Consolidated Balance Sheets.

Extinguishment of the Secured Term Note on March 10, 2021 resulted in settlement of the interest make-whole derivative liability.

The Company did not have any transfers between fair value measurement levels during the periods presented.

There were no changes to the Company's valuation methodologies during the years ended December 31, 2020 or 2019, respectively.

The following tables present the changes in the Company's recurring Level 3 fair value measurements for the financing derivatives, warrants liability and interest make-whole derivative for the years ended December 31, 2020 and 2019:

(In thousands) Financing Derivative Liabilities Warrants Liability Interest Make-whole Derivative Liability

There were no changes to the Company's valuation techniques during the years ended December 31, 2021 or 2020, respectively.

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The following tables present the changes in the Company's recurring Level 3 fair value measurements for the warrants liability, contingent consideration, financing derivatives and interest make-whole derivative for the years ended December 31, 2021 and 2020:

(In thousands) Warrants Liability Contingent Consideration Liability Financing Derivatives Interest Make-whole Derivative

Balance as of December 31, 2019 $ 7,725 $ — $ 21,587 $ —

Issuances 587 10,798 —

Settlement — ( 5,484 ) —

Total (gain) loss included in other income (expense), net (1)

Total (gain) loss included in other (expense) income, net (1) (2)

( 4,894 ) — ( 10,287 ) 871

Balance as of December 31, 2020 2,831 — 11,300 871

Total (gain) loss included in other income (expense), net (2)

Total loss (gain) included in other (expense) income, net (2)

7,689 — ( 1,800 ) 150

Settlement or derecognition upon extinguishment of host debt — — ( 9,500 ) ( 1,021 )

Initial recognition and measurement — 5,600 — —

Balance as of December 31, 2021 $ 10,520 $ 5,600 $ — $ —

(1) Represents $ 4.5 million gain due to change in fair value of interest rate reset derivative liability and $ 0.6 million gain due to change in fair value of the make-whole change of control redemption derivative liability.

Represents $ 3.6 million loss due to change in fair value of the Series A Warrants, and gains of $ 0.3 million, $ 0.2 million and $ 0.7 million due to change in fair value of the Series B-1 Warrants, Series B-2 Warrants and Series C Warrants, respectively.

All gains and losses were recorded in other income (expense), net in the Consolidated Statements of Operations and Comprehensive Loss.

(1) Represents $ 7.5 million gain due to change in fair value of interest rate reset derivative liability, $ 1.6 million gain due to change in fair value of the make-whole change of control redemption derivative liability and $ 1.2 million gain due to change in fair value of the qualifying change of control redemption derivative liability.

Represents $ 4.7 million gain due to change in fair value of the Series A Warrants and $ 0.2 million gain due to change in fair value of the Series B-2 Warrants.

All gains were recorded in other income (expense), net in the Consolidated Statements of Operations and Comprehensive Loss.

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The following table displays valuation techniques and the significant inputs, certain of which are unobservable, for the Company's Level 3 liabilities measured at fair value as of December 31, 2020 and 2019:

(2) All losses and gains were recorded in other (expense) income, net in the Consolidated Statements of Operations and Comprehensive Loss.

The following table displays the valuation technique and the significant inputs, certain of which are unobservable, for the Company's Level 3 liabilities that existed as of December 31, 2021 and 2020 that are measured at fair value on a recurring basis.

Fair value measurements

Significant Valuation Technique Significant Valuation Inputs December 31, 2020 December 31, 2019

Interest rate reset derivative liability Discounted cash flow Discount rate 20.0 % 25.0 %

Stock price $ 2.49 $ 4.94

Valuation Technique Significant Inputs December 31, 2021 December 31, 2020

Warrants liability Option pricing Stock price $ 3.34 $ 2.49

Exercise price $ 2.47 $ 12.00

Volatility 85.0 % 80.0 %

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Risk-free rate 0.9 % 0.2 %

Make-whole change of control redemption derivative liability (1)

Option pricing model Change of control probability — % 5.0 % - 10.0 %

Term — 2.04 years

Risk-free rate — % 1.6 %

Qualifying change of control redemption derivative liability (2)

Discounted cash flow Change of control probability — % 5.0 %

Term — 0.60 years

Discount rate — % 25.0 %

Warrants liability (3)

Option pricing model Stock price $ 2.49 $ 4.94

Volatility 80.0 % 65.0 %

Contingent consideration liability Combination (1)

Product credit $ 10.7 million

Revenue volatility 21.0 % —

Risk premium 8.4 % —

Term 1.04 years

0.59 - 4.49 years

Change of control probability — % 5.0 % - 10.0 %

Risk-free rate 0.2 % 1.6 % - 1.7 %

Cost of debt 4.4 % —

Interest make-whole derivative liability Discounted cash flow Recapitalization probability 90.0 % — %

Term 0.25 years

Risk-free rate 0.10 % — %

(1) The probability of a make-whole change of control, and the resulting fair value determination, was estimated to be negligible as of December 31, 2020.

(2) The qualifying change of control redemption derivative liability expired on August 5, 2020.

(3) Warrants liability includes only Series A as of December 31, 2020.

Warrants liability includes Series A and Series B-2 as of December 31, 2019.

The fair values of the Company's financing derivatives are estimated using forward projections and are discounted back at rates commensurate with the remaining term of the related derivative.

The primary sensitivity in the interest rate reset derivative liability is driven by the discount rate used to determine the present value of the instrument, the Common Stock price at the measurement date and the observable volatility of the Common Stock.

The primary sensitivity for the make-whole and qualifying change of control redemption derivative liabilities is driven by the probability of the change of control.

The fair values of the Company's warrants liability are estimated using forward projections of stock issuances with relative certainty and estimated cash payments at each exercise date discounted back to the valuation date at rates commensurate with the remaining term of the related warrants.

The primary sensitivity in the valuation of each warrant liability is driven by the Common Stock price at the measurement date and the observable volatility of the Common Stock.

The primary sensitivity in the interest make-whole derivative liability is driven by the probability, and closing date, of a fundamental transaction which includes, but is not limited to, a recapitalization of the Company.

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(1) The selected weightings for the option pricing model and discounted cash flow model outcomes were 70.0 % and 30.0 %, respectively, as of December 31, 2021.

Refer to Footnote 2 , Summary of Significant Accounting Policies for further information on the valuation technique.

The primary sensitivities in the valuation of the warrants liability are driven by the price and expected volatility of the Company's Common Stock at the valuation date.

The primary sensitivities in the option pricing model are driven by forecasted performance and the selected weighting of the model.

The primary sensitivities in the discounted cash flow model are the cost of debt and the selected weighting of the model.

Property and Equipment

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Total property and equipment, net $ 36,451 $ 30,973

During 2020, the Company recorded an impairment charge related to certain facility leases and associated leasehold improvements.

$ 1.9 million of this charge was recorded against the property and equipment, net line item in the Consolidated Balance Sheet.

For the years ended December 31, 2021, 2020, and 2019, depreciation expense was $ 15.8 million, $ 14.1 million and $ 12.8 million, respectively.

In addition, amortization expense from finance leases was $ 1.7 million and $ 2.4 million for the years ended December 31, 2020 and 2019, respectively.

The composition of the Company's property and equipment, net between those in the United States and those in other locations as of the end of each year is as follows:

As of December 31,

(In thousands) 2020 2019

United States $ 30,041 $ 30,556

Latin America 341 251

Europe 333 841

Total $ 30,973 $ 31,693

In addition, amortization expense from finance leases was $ 2.2 million, $ 1.7 million and $ 2.4 million for the years ended December 31, 2021, 2020, and 2019, respectively.

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Of the Company's property and equipment, net, 98 % and 97 % was located in the United States as of December 31, 2021 and 2020, respectively.

The Company has operating leases for real estate and finance leases for computer equipment and automobiles.

These leases have remaining lease terms of one year to seven years , some of which include options to extend the leases for up to five years , and some of which include options to terminate the leases within one year .

These leases have remaining lease terms of one year to six years , some of which include options to extend the leases for up to five years , and some of which include options to terminate the leases within one year .

As of December 31, 2021, the weighted average remaining lease term for the Company's finance leases and operating leases was 2.1 years and 5.1 years, respectively.

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Total operating lease cost $ 10,640 $ 12,228 $ 13,515

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Lease costs, net of sublease income, are reflected in the Consolidated Statements of Operations and Comprehensive Loss as follows:

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Total operating lease cost $ 10,640 $ 12,228 $ 13,515

During 2020, the Company recorded an impairment charge related to certain facility leases and associated leasehold improvements.

$ 2.8 million of this charge was recorded against the operating right-of-use assets line item in the Consolidated Balance Sheet.

Supplemental cash flow information related to leases was as follows:

Years Ended December 31,

(In thousands) 2020 2019

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from finance leases $ 493 $ 471

Operating cash flows from operating leases 11,170 15,546

Right-of-use assets obtained in exchange for lease obligations:

Right-of-use assets obtained in exchange for new finance lease liabilities $ 754 $ 4,049

Right-of-use assets obtained in exchange for new operating lease liabilities 669 397

Maturities of operating and finance lease liabilities as of December 31, 2021 were as follows:

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Total non-current lease liabilities $ 36,055 $ 2,032

As of December 31, 2020, the Company subleases seven real estate properties.

One sublease has a noncancelable term of less than one year.

The remaining six subleases are noncancelable and have remaining lease terms of two years to seven years .

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As of December 31, 2021, the Company subleases six real estate properties.

Two subleases have a non-cancelable term of less than one year.

The remaining four subleases are non-cancelable and have remaining lease terms of two years to six years .

None of these subleases contain any options to renew or terminate the sublease agreement.

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Total expected sublease receipts $ 7,189

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Goodwill and Intangible Assets

9 unchanged sentences

Translation adjustments 1,909

Impairment charge ( 224,272 )

Balance as of December 31, 2020 $ 418,327

Goodwill recognized from acquisition 19,202

Translation adjustments ( 1,818 )

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The fair value of the strategic alliance intangible asset was estimated using an income approach resulting in an impairment charge for the full carrying value of the long-lived asset of $ 17.3 million.

The carrying values of the Company's amortizable acquired intangible assets are as follows:

The carrying values of the Company's definite-lived intangible assets are as follows:

December 31, 2021 December 31, 2020

3 unchanged sentences

Amount Accumulated

Amortization Accumulated Impairment Net

Amortization Net

Acquired methodologies and technology $ 154,436 $ ( 126,743 ) $ 27,693 $ 148,403 $ ( 106,771 ) $ 41,632

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Trade names 753 ( 753 ) — 773 ( 757 ) 16

Strategic alliance — — — 30,100 ( 12,792 ) ( 17,308 ) —

Other 600 ( 600 ) — 600 ( 499 ) 101

Total intangible assets $ 229,267 $ ( 189,322 ) $ 39,945 $ 216,749 $ ( 164,409 ) $ 52,340

Table of Conte nt s

Amortization expense related to intangible assets was $ 25.0 million, $ 27.2 million, and $ 30.1 million for the years ended December 31, 2021, 2020, and 2019, respectively.

Of the Company's long-lived intangible assets, net, $ 52.3 million and $ 79.5 million were generated by or located in the United States as of December 31, 2020 and 2019, respectively.

Of the Company's definite-lived intangible assets, net, substantially all were generated by or located in the United States as of December 31, 2021 and 2020, respectively.

The weighted-average remaining amortization period by major asset class as of December 31, 2021 is as follows:

Intellectual property 3.7

Customer relationships 1.5

Acquired methodologies and technology 1.9

Trade names 0.2

Acquired software 0.1

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Customer relationships 3.4

Intellectual property 2.7

The estimated future amortization of intangible assets is as follows:

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Payroll and payroll-related 16,272 14,653

Accrued interest on senior secured convertible notes — 6,120

Professional fees 2,978 4,848

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The settlement received preliminary court approval on September 24, 2020.

it remains subject to final court approval.

Securities Class Action Litigation

On April 10, 2019, Sergii Bratusov, a purported shareholder of the Company, filed a putative class action complaint against the Company.

The case, captioned Bratusov v.

comScore, Inc., et al.

03210, was filed in the U.S.

District Court for the Southern District of New York and also named the Company's Chief Financial Officer, Gregory Fink, and the Company's former Chief Executive Officer, Bryan Wiener, as defendants.

The complaint, which was amended on September 30, 2019, purported to bring claims on behalf of all persons and entities that acquired securities of the Company between February 28, 2019 and August 7, 2019 and alleged that the Company, Mr.

Wiener, and Mr.

Fink violated Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, by allegedly failing to disclose in public statements in February and March 2019 material information concerning a disagreement relating to the Company's business strategy.

The complaint also alleged that Mr.

Wiener and Mr.

Fink, acting as control persons of the Company, violated Section 20(a) of the Exchange Act in connection with the Company's alleged failure to disclose material information.

The complaint sought a determination of the propriety of the class, compensatory damages and the award of

The settlement received final court approval on April 12, 2021.

Table of Conte nt s

reasonable costs and expenses incurred in the action.

On June 24, 2020, the Court granted the defendants' motion to dismiss the complaint for failure to state a claim.

On July 24, 2020, the complaint was dismissed with prejudice.

Other Matters

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Similarly, certain of the Company's commercial contracts require it to indemnify contract counterparties under specified circumstances, and the Company may incur legal counsel fees and other costs in connection with these obligations.

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The components of loss before income tax provision (benefit) are as follows:

16 unchanged sentences

Income tax provision (benefit) $ 859 $ 902 $ ( 1,007 )

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A reconciliation of the statutory U.S.

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Goodwill impairment — % — % ( 10.7 ) %

Subscription receivable — % — % ( 1.2 ) %

US tax impact of restructuring 10.3 % ( 14.4 ) % — %

3 unchanged sentences

Income Tax (Provision) Benefit

The Company recognized income tax expense of $ 0.9 million during the year ended December 31, 2021, which is primarily comprised of current tax expense of $ 2.2 million related to foreign taxes and a federal deferred tax benefit of $ 1.5 million related to temporary differences between the tax treatment and GAAP accounting treatment for certain items.

Included in total tax expense are income tax adjustments of $ 9.2 million for permanent differences in the book and tax treatment of certain stock-based compensation, limitations on the deductibility of certain executive compensation, and nondeductible interest expense on debt instruments and associated derivatives.

Also included is a favorable return to provision true-up adjustment of $ 8.3 million for a prior year permanent difference related to foreign earnings taxable in the U.S.

as a result of a tax restructuring that occurred during 2020.

Income tax expense of $ 16.3 million has also been included for an increase in the valuation allowance recorded against the Company's deferred tax assets to offset the tax benefit of the Company's operating losses in the U.S.

and certain foreign jurisdictions.

This increase was offset by an income tax benefit of $ 2.8 million related to the release of the portion of the Company's valuation allowance as a result of the Shareablee acquisition.

These tax adjustments, along with state and local taxes and book losses in foreign jurisdictions where the income tax rate is substantially lower than the U.S.

federal statutory rate, are the primary drivers of the annual effective income tax rate.

The Company recognized income tax expense of $ 0.9 million during the year ended December 31, 2020, which is primarily comprised of current tax expense of $ 0.8 million related to foreign taxes.

7 unchanged sentences

and certain foreign jurisdictions.

Also included in the total tax benefit are income tax adjustments of $ 58.6 million related to the impairment of goodwill and $ 15.2 million for permanent differences in the book

Table of Conte nt s

and tax treatment of certain stock-based compensation, limitations on the deductibility of certain executive compensation, nondeductible interest expense on debt instruments and associated derivatives, and other nondeductible expenses.

These tax adjustments, along with state and local taxes and book losses in foreign jurisdictions where the income tax rate is substantially lower than the U.S.

federal statutory rate, are the primary drivers of the annual effective income tax rate.

The Company recognized an income tax expense of $ 3.7 million during the year ended December 31, 2018, which is comprised of current tax expense of $ 1.7 million primarily related to foreign taxes and a deferred tax expense of $ 2.0 million related to temporary differences between the tax treatment and GAAP accounting treatment for certain items.

Included within the total tax expense is an income tax expense of $ 19.0 million related to the increase in valuation allowance recorded against the Company's deferred tax assets to offset the tax benefit of the Company's operating losses in the U.S.

and certain foreign jurisdictions.

An income tax adjustment of $ 19.7 million has also been included for permanent differences in the book and tax treatment of certain stock-based compensation, limitations on the deductibility of certain executive compensation, nondeductible interest expense on debt instruments and associated derivatives, and other nondeductible expenses.

Also included in the total tax benefit are income tax adjustments of $ 58.6 million related to the impairment of goodwill and $ 15.2 million for permanent differences in the book and tax treatment of certain stock-based compensation, limitations on the deductibility of certain executive compensation, nondeductible interest expense on debt instruments and associated derivatives, and other nondeductible expenses.

These tax adjustments, along with state and local taxes and book losses in foreign jurisdictions where the income tax rate is substantially lower than the U.S.

federal statutory rate, are the primary drivers of the annual effective income tax rate.

The COVID-19 pandemic has a global reach, and many countries have introduced measures that provide relief to taxpayers in a variety of ways.

The Company has evaluated these measures, including the CARES Act in the United States, and has concluded that these did not have a significant impact on its income tax (provision) benefit for the year ended December 31, 2020.

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Deferred Income Taxes

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Capital loss carryforwards 269 263

Goodwill — 2,462

Litigation settlement — 225

Other 2,307 2,550

15 unchanged sentences

entities, including federal and state tax attributes and timing differences, as well as the deferred tax assets of certain foreign subsidiaries.

The increase in the valuation allowance during 2020 is primarily related to the pre-tax losses generated in the U.S.

To the extent the Company determines that, based on the weight of available evidence, all or a portion of its valuation allowance is no longer necessary, the

Table of Conte nt s

Company will recognize an income tax benefit in the period such determination is made for the reversal of the valuation allowance.

The increase in the valuation allowance during 2021 is primarily related to the pre-tax losses generated in the U.S., offset by the valuation allowance release as a result of the Shareablee acquisition mentioned above.

To the extent the Company determines that, based on the weight of available evidence, all or a portion of its valuation allowance is no longer necessary, the Company will recognize an income tax benefit in the period such determination is made for the reversal of the valuation allowance.

If management determines that, based on the weight of available evidence, it is more-likely-than-not that all or a portion of the net deferred tax assets will not be realized, the Company may recognize income tax expense in the period such determination is made to increase the valuation allowance.

5 unchanged sentences

$ 220,115 $ 219,607

Additions 737 19,832

Additions from continuing operations 13,462 737

Additions from acquisition accounting 275 —

Reductions ( 9 ) ( 229 )

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These net operating loss carryforwards will begin to expire in 2023 for federal income tax purposes and 2022 for state income tax purposes.

The federal and certain state net operating losses generated after December 31, 2017 have an indefinite carryforward period.

The federal and certain state net operating losses generated after December 31, 2017 have an indefinite carryforward

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As of December 31, 2021, the Company had an aggregate net operating loss carryforward for tax purposes related to its foreign subsidiaries of $ 5.4 million, which will begin to expire in 2024.

2 unchanged sentences

net operating loss carryforwards that can be utilized annually to offset future taxable income and taxes payable.

A significant portion of the Company's net operating loss carryforwards are subject to an annual limitation under Section 382 of the Internal Revenue Code, and the Company anticipates that the Transactions will trigger further limitations.

A significant portion of the Company's net operating loss carryforwards are subject to an annual limitation under Section 382 of the Internal Revenue Code.

The Company anticipates the Transactions may have triggered further limitations but has not yet reached a final conclusion as to whether an ownership change occurred and to what extent its net operating loss carryforwards are further limited.

Additionally, despite the net operating loss carryforwards, the Company may have a future tax liability due to foreign tax or state tax requirements.

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The Company anticipates a negligible amount of unrecognized tax benefits will reverse during the next year due to the expiration of statutes of limitation.

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Changes in the Company's unrecognized income tax benefits are as follows:

9 unchanged sentences

The Company recognizes interest and penalties related to income tax matters in income tax expense.

As of December 31, 2020 and 2019, accrued interest and penalties on unrecognized tax benefits were $ 0.1 million and $ 0.7 million, respectively.

As of December 31, 2021 and 2020, accrued interest and penalties on unrecognized tax benefits were $ 0.1 million.

The Company or one of its subsidiaries files income tax returns in the U.S.

6 unchanged sentences

Transactions with WPP

As of December 31, 2020 (based on public filings), WPP owned 11,319,363 shares of the Company's outstanding Common Stock, representing 15.5 % ownership in the Company.

On July 19, 2018, the Company filed a registration statement on Form S-1 with the SEC for the purpose of registering the shares of Common Stock owned by WPP in order to fulfill the Company's contractual obligations under a stockholders' rights agreement entered into by the Company and WPP in 2015.

Refer to Footnote 4 , Debt for more information.

As of December 31, 2021 (based on public filings), WPP owned 11,319,363 shares of the Company's outstanding Common Stock, representing 12.5 % of the outstanding Common Stock.

The Company provides WPP, in the normal course of business, services amongst its different products and receives various services from WPP supporting the Company's data collection efforts.

In 2015, there were a series of business and asset acquisitions and sales and issuances of Common Stock between the Company and WPP (giving rise to the stockholders' rights agreement described above) as well as a Subscription Receivable agreement that the Company entered into with GroupM, a WPP subsidiary.

In 2016, as part of the Company's merger with Rentrak Corporation, the Company acquired contracts with WPP wholly-owned subsidiaries which were also included as a Subscription Receivable.

The Subscription Receivable was recorded as contra equity within additional paid-in capital on the Consolidated Statements of Stockholders' Equity.

As cash was received on the Subscription Receivable, additional paid-in capital was increased by the amount of cash received and the Company recognized imputed interest income.

Upon fully utilizing the Subscription Receivable in September 2018, the Company began recognizing revenue as products and services were delivered under the respective agreements.

Total revenue recognized under these agreements was $ 6.6 million, $ 8.3 million and $ 2.8 million for the years ended December 31, 2020, 2019 and 2018, respectively.

The Company has a cancelable five-year agreement with Lightspeed, a WPP subsidiary, to collect browsing and demographic data for individual participating households.

The agreement provides that the Company makes payments to Lightspeed of approximately $ 5.4 million per year through December 2025.

The agreement is designed to be a comprehensive data collection effort across multiple in-home devices (e.g., television, streaming devices, computers, mobile phones, tablets, gaming devices and wearables) for which data is collected and sent to the Company for use in its products.

Lightspeed is paid to manage the operational aspects of panel recruitment, compliance, inventory management, support and collection of panel demographic data.

The Company's results from transactions with WPP and its affiliates, as reflected in the Consolidated Statements of Operations and Comprehensive Loss, are detailed below:

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The Company's results from transactions with WPP, as reflected in the Consolidated Statements of Operations and Comprehensive Loss, are detailed below:

Years Ended December 31,

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General and administrative 155 316 539

Interest income — — 343

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The Company has the following balances related to transactions with WPP and its affiliates, as reflected in the Consolidated Balance Sheets:

The Company has the following balances related to transactions with WPP, as reflected in the Consolidated Balance Sheets:

As of December 31,

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Contract liabilities 3,403 3,538

Transactions with Starboard

On January 16, 2018, the Company entered into certain agreements with Starboard, then a beneficial owner of more than five percent of the Company's outstanding Common Stock.

Refer to Footnote 4 , Debt , for further information regarding these agreements and the Company's issuance of senior secured convertible notes to Starboard in 2018.

As a result of these agreements and the transactions contemplated thereby, Starboard ceased to be a beneficial owner of more than five percent of the Company's outstanding Common Stock on January 16, 2018.

On April 18, 2018, the Company amended a prior agreement with Starboard, dated as of September 28, 2017 (the "September Agreement"), pertaining to the membership and composition of the Company's Board of Directors (the "Board").

Pursuant to the amendment, the Company and Starboard agreed that, effective as of the Company's annual meeting of stockholders on May 30, 2018, the size of the Board would be fixed at eight members.

The amendment further designated Starboard's "appointees" under the September Agreement.

As of December 31, 2018, Starboard had no remaining right to designate any directors to the Board.

Included in the Consolidated Statements of Operations and Comprehensive Loss, the Company recorded interest expense, inclusive of non-cash accretion of issuance discount and deferred financing costs, related to the senior secured convertible notes of $ 33.3 million, $ 30.8 million, and $ 16.4 million during the years ended December 31, 2020, 2019 and 2018, respectively.

The Company has the following balances related to transactions with Starboard, as reflected in the Consolidated Balance Sheets:

As of December 31,

(In thousands) 2020 2019

Accrued expenses $ — $ 6,120

Senior secured convertible notes 192,895 184,075

Financing derivatives 11,300 21,587

Other non-current liabilities 1,582 —

Organizational Restructuring

In June and December 2018, the Company's Board of Directors authorized management to implement reductions in its workforce (less than 10 %) and rationalize its portfolio of leased properties due to the reductions in headcount ("2018 Restructuring Plans").

This restructuring effort resulted in the termination of one operating lease, the extension of the lease related to the Company's headquarters, and the sublease of three offices.

In connection with the 2018 Restructuring Plans, the Company incurred total exit-related costs of $ 8.1 million.

$ 10.3 million was recorded in 2018, and $ 2.2 million was reversed in 2019 related to an employee who ultimately did not exit the Company.

These plans were complete as of December 31, 2019.

In May 2019, the Company implemented an additional reduction in force plan ("May 2019 Restructuring Plan") in order to reduce costs and more effectively align resources with business priorities.

Together with attrition, the May 2019 Restructuring Plan resulted in the termination of approximately 10 % of the Company's workforce.

In connection with the May 2019 Restructuring Plan, the Company incurred total exit-related costs of $ 3.1 million during the year ended December 31, 2019.

The Company does not expect to incur any future expenses related to this plan.

In August 2019, the Company implemented a further reduction in force plan ("August 2019 Restructuring Plan") in order to reduce costs and more effectively align resources with business priorities.

The August 2019 Restructuring Plan resulted in the termination of approximately 8 % of the Company's workforce.

In connection with the August 2019 Restructuring Plan, the Company incurred total exit-related costs of $ 2.5 million.

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The tables below summarize the balance of accrued restructuring expenses and the changes in the accrued amounts for each period presented.

2018 Restructuring Plans

(In thousands) Severance pay and benefits Short-term lease exit and other direct costs Long-term lease exit and other direct costs Total

Restructuring expense (1)

$ 7,145 $ 1,271 $ 1,847 $ 10,263

Payments ( 2,652 ) ( 561 ) ( 37 ) ( 3,250 )

Foreign exchange — ( 2 ) — ( 2 )

Accrued Balance as of December 31, 2018 $ 4,493 $ 708 $ 1,810 $ 7,011

Adoption of ASC 842 (2)

— ( 708 ) ( 1,810 ) ( 2,518 )

Restructuring expense (3)

( 2,195 ) — — ( 2,195 )

Payments ( 2,298 ) — — ( 2,298 )

Accrued Balance as of December 31, 2019 $ — $ — $ — $ —

(1) During the year ended December 31, 2018, the Company recognized a reduction of $ 0.7 million of liability related to the write-off of certain lease-related liabilities, offset by $ 0.5 million in stock-based compensation related to the termination of certain employees, $ 0.5 million in accelerated depreciation on assets located within subleased properties, and $ 0.1 million in other expenses.

(2) The Company adopted ASC 842, Leases, as of January 1, 2019.

For additional details regarding the adoption, please refer to Footnote 2 , Summary of Significant Accounting Policies.

(3) Restructuring expense decreased due to a reversal of planned executive compensation.

2019 Restructuring Plans

(In thousands) May 2019 Restructuring Plan August 2019 Restructuring Plan

Severance pay and benefits related restructuring expense $ 3,141 $ 2,454

Payments ( 2,847 ) ( 1,756 )

Accrued Balance as of December 31, 2019 294 698

Payments ( 294 ) ( 698 )

Accrued Balance as of December 31, 2020 $ — $ —

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Quarterly Financial Information (Unaudited)

The following tables summarize quarterly financial data for 2020 and 2019.

The Company's results of operations vary and may continue to fluctuate significantly from quarter to quarter.

The results of operations in any period should not necessarily be considered indicative of the results to be expected from any future period.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

First Second Third Fourth

Transactions with Charter, Qurate and Pine

Charter, Qurate and Pine each hold 33.3 % of the outstanding shares of Preferred Stock, which are entitled to convert into shares of Common Stock and to vote as a single class with the holders of the Common Stock as described in Footnote 5 , Convertible Redeemable Preferred Stock and Stockholders' Equity .

In addition, Charter, Qurate and Pine each designated two directors to the Company's Board in accordance with the Stockholders Agreement.

As of December 31, 2021, Charter, Qurate and Pine each owned 27,509,203 shares of the Company's outstanding Preferred Stock.

On June 30, 2021, in accordance with the Certificate of Designations of the Preferred Stock, the Company made cash dividend payments totaling $ 4.8 million to the holders of the Preferred Stock, representing dividends accrued for the period from the Closing Date through June 29, 2021.

As of December 31, 2021, accrued dividends to the holders of Preferred Stock totaled $ 7.9 million.

Concurrent with the closing of the Transactions on March 10, 2021, the Company entered into a ten-year Data License Agreement ("DLA") with Charter Communications Operating, LLC ("Charter Operating"), an affiliate of Charter.

Under the DLA, Charter Operating will bill the Company for license fees according to a payment schedule that gradually increases from $ 10.0 million in the first year of the term to $ 32.3 million in the tenth year of the term.

The Company recognizes expense for the license fees ratably over the term.

A portion of the annual license fees is allocated to a base license comparable to the Company's prior license with Charter Operating.

The remaining fees are allocated to the additional data sets contemplated by the DLA and the designation and related endorsement of the Company as Charter Operating's preferred data measurement partner for the term.

The Company's results from transactions with Charter and its affiliates, as reflected in the Consolidated Statements of Operations and Comprehensive Loss, are detailed below:

(In thousands) Year Ended December 31, 2021

Revenues $ 1,849

Cost of revenues 21,998

45,798 44,949 46,466 43,499

Gross profit 43,730 43,617 41,486 46,491

Selling and marketing (1)

19,213 16,007 17,131 17,869

Research and development (1)

10,136 9,765 9,501 9,304

General and administrative (1)

15,543 13,741 12,136 14,363

Amortization of intangible assets 6,918 6,846 6,750 6,705

Impairment of right-of-use and long-lived assets 4,671 — — —

Total expenses from operations 56,481 46,359 45,518 48,241

Loss from operations ( 12,751 ) ( 2,742 ) ( 4,032 ) ( 1,750 )

Interest expense, net ( 8,846 ) ( 8,856 ) ( 9,027 ) ( 9,076 )

Other income, net 7,194 1,477 4,191 1,692

Gain (loss) from foreign currency transactions 804 ( 944 ) ( 2,012 ) ( 2,338 )

Loss before income taxes ( 13,599 ) ( 11,065 ) ( 10,880 ) ( 11,472 )

Income tax benefit (provision) 415 664 ( 241 ) ( 1,740 )

Net loss $ ( 13,184 ) $ ( 10,401 ) $ ( 11,121 ) ( 13,212 )

Net loss per common share:

Basic and diluted $ ( 0.19 ) $ ( 0.15 ) $ ( 0.16 ) $ ( 0.18 )

Weighted-average number of shares used in per share calculation - Common Stock:

Basic and diluted 70,127,939 70,554,326 71,222,122 72,814,261

(1) Amortization of stock-based compensation expense is included in the line items above as follows:

First Second Third Fourth

Cost of revenues $ 209 $ 487 $ 503 $ 89

Selling and marketing 609 720 625 272

Research and development 56 375 386 69

General and administrative 1,784 764 1,010 2,115

Total stock-based compensation expense $ 2,658 $ 2,346 $ 2,524 $ 2,545

The Company has the following liability balances related to transactions with Charter and its affiliates, as reflected in the Consolidated Balance Sheet:

(In thousands) December 31, 2021

Accounts payable $ 5,180

Accrued expenses 3,377

Non-current portion of accrued data costs 7,843

The Company recognized revenues of $ 0.8 million from transactions with Qurate and its affiliates in the normal course of business during the year ended December 31, 2021 as reflected in the Consolidated Statements of Operations and Comprehensive Loss.

The Company had no transactions, other than the issuance of shares of Preferred Stock and related matters, with Pine for the year ended December 31, 2021.

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First Second Third Fourth

Revenues $ 102,294 $ 96,888 $ 94,300 $ 95,163

Cost of revenues (1)

53,407 51,994 47,390 46,831

Gross profit 48,887 44,894 46,910 48,332

Selling and marketing (1)

24,840 23,329 20,421 20,555

Research and development (1)

18,216 16,883 14,064 12,639

General and administrative (1)

19,545 16,932 14,064 15,878

Amortization of intangible assets 8,105 8,076 6,970 6,925

Investigation and audit related 842 2,354 980 129

Impairment of goodwill — 224,272 — —

Impairment of intangible assets — 17,308 — —

Settlement of litigation, net — 5,000 ( 2,100 ) —

Restructuring ( 70 ) 2,949 2,270 ( 1,886 )

Total expenses from operations 71,478 317,103 56,669 54,240

Loss from operations ( 22,591 ) ( 272,209 ) ( 9,759 ) ( 5,908 )

Interest expense, net ( 6,759 ) ( 8,242 ) ( 8,175 ) ( 8,350 )

Other income (expense), net 2,969 ( 3,081 ) 6,733 ( 4,967 )

Gain (loss) from foreign currency transactions 38 ( 464 ) 1,194 ( 432 )

Loss before income taxes ( 26,343 ) ( 283,996 ) ( 10,007 ) ( 19,657 )

Income tax (provision) benefit ( 1,171 ) 4,463 ( 552 ) ( 1,733 )

Net loss $ ( 27,514 ) $ ( 279,533 ) $ ( 10,559 ) $ ( 21,390 )

Net loss per common share:

Basic and diluted $ ( 0.46 ) $ ( 4.61 ) $ ( 0.16 ) $ ( 0.31 )

Weighted-average number of shares used in per share calculation - Common Stock:

Basic and diluted 59,958,203 60,697,608 64,157,167 69,644,437

(1) Stock-based compensation expense is included in the line items above as follows:

First Second Third Fourth

Cost of revenues $ 848 $ 636 $ 396 $ ( 28 )

Selling and marketing 1,316 1,087 756 456

Research and development 726 668 469 118

General and administrative 4,063 1,913 1,392 1,879

Restructuring — ( 266 ) 129 —

Total stock-based compensation expense $ 6,953 $ 4,038 $ 3,142 $ 2,425

Transactions with Starboard

In 2018, the Company entered into certain agreements with Starboard, then a beneficial owner of more than 5.0 % of the Company's outstanding Common Stock.

Refer to Footnote 6 , Debt , for further information regarding these agreements and the Company's issuance of Notes to Starboard in 2018.

As a result of these agreements and the transactions contemplated thereby, Starboard ceased to be a beneficial owner of more than 5.0 % of the Company's outstanding Common Stock in January 2018.

In addition, pursuant to a prior agreement with Starboard, the Company provided Starboard the right to designate certain members to the Company's Board.

As of December 31, 2018, Starboard had no remaining right to designate any directors to the Board.

As of December 31, 2021, there were no directors remaining on the Board who were designated by Starboard.

In the Consolidated Statements of Operations and Comprehensive Loss, the Company recorded interest expense, inclusive of non-cash accretion of issuance discount and deferred financing costs, related to the Notes of $ 6.6 million, $ 33.3 million and $ 30.8 million during the years ended December 31, 2021, 2020 and 2019, respectively.

In connection with the extinguishment of the Notes on March 10, 2021, the Company issued 3,150,000 Conversion Shares to Starboard valued at $ 9.6 million as discussed in Footnote 6 , Debt , which amount was included as a component of loss on extinguishment of debt in the Consolidated Statements of Operations and Comprehensive Loss.

The Company had no outstanding balances related to Starboard as of December 31, 2021.

The outstanding balances for the Notes, related financing derivatives, and other non-current liabilities as of December 31, 2020 are reflected in the Consolidated Balance Sheet.

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Subsequent Events

On January 7, 2021, the Company entered into separate Securities Purchase Agreements with each of Charter, Qurate and Pine, pursuant to which, at the closing of the Transactions contemplated thereby, the Company will issue and sell (a) to Charter, 27,509,203 shares of Series B Convertible Preferred Stock in exchange for $ 68.0 million, (b) to Qurate, 27,509,203 shares of Series B Convertible Preferred Stock in exchange for $ 68.0 million and (c) to Pine, 27,509,203 shares of Series B Convertible Preferred Stock in exchange for $ 68.0 million.

The proceeds of the Transactions will be used to repay the Notes.

Additionally, in connection with the closing, the Company expects to repay the Secured Term Note and certain transaction-related expenses with cash from its balance sheet.

Refer to Footnote 4 , Debt for additional information on the Notes and the Secured Term Note.

The Transactions and related matters were approved by the Company's stockholders on March 9, 2021 and are expected to be completed on or around March 10, 2021.

The exercise price of the Company's Series A Warrants described in Footnote 5 , Stockholders' Equity , is subject to anti-dilution adjustment in certain circumstances, including upon certain issuances of capital stock.

As a result of the Transactions described above, the Company expects to adjust the exercise price of the Series A Warrants to the closing price of the Transactions.

Upon closing of the Transactions, the Company expects to record a non-cash charge that will include extinguishment of debt and associated derivatives, issuance of 3.15 million conversion shares to affiliates of Starboard Value LP, and the anti-dilution adjustment to the Series A Warrants described above.

The non-cash charge at closing is estimated to range between $ 15 million and $ 25 million based on recent trading prices of the Company's Common Stock, but could vary depending on the market price of the Common Stock on the closing date and other variables.

Amendment to Revolving Credit Agreement

On February 25, 2022, the Company entered into an amendment (the "Amendment") to the Revolving Credit Agreement.

In addition to expanding the Company's aggregate borrowing capacity under the Revolving Credit Agreement from $ 25.0 million to $ 40.0 million, the Amendment modified certain financial covenants and interest rates under the Revolving Credit Agreement.

The amended Revolving Credit Agreement requires the Company to maintain:

• minimum Consolidated EBITDA (as defined in the Revolving Credit Agreement) of not less than $ 20.0 million for the most recently ended four fiscal quarter period, tested as of the last day of each fiscal quarter ending on or before December 31, 2022;

• a minimum Consolidated Asset Coverage Ratio (as defined in the Revolving Credit Agreement) of not less than 1.5 to 1.0 for the most recently ended four fiscal quarter period, tested as of the last day of each fiscal quarter ending on or before December 31, 2022;

The Amendment also replaced the Eurodollar Rate (as defined in the Revolving Credit Agreement) with a SOFR-based interest rate and modified the Applicable Rate definition in the Revolving Credit Agreement to increase the Applicable Rate payable on SOFR-based loans to 2.50 % until the date a compliance certificate is received for the quarter ending March 31, 2023, with such Applicable Rate thereafter reducing to 2.25 %.

CEO Transition

On February 28, 2022, the Company's Chief Executive Officer ("CEO") and Executive Vice Chairman, William Livek, announced his intention to retire as the Company's CEO and transition to a non-executive Vice Chairman role after his successor as CEO is named.

Livek plans to serve as non-executive Vice Chairman of the Company's Board of Directors through the completion of his Board term in 2024.

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What changed 10-K

Item 8. Financial Statements and Supplementary Data