| ☐ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(B) OR 12(G) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| ☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
2021
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| ☐ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Not applicable | Island of Guernsey | |
(Translation of Registrant’s name into English) | (Jurisdiction of incorporation or organization) |
Telephone: +44
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Ordinary shares | GENI | New York Stock Exchange | ||
Warrants | GENI WS | New York Stock Exchange |
shares, 18,500,000 outstanding B shares stapled to the NFL warrants, 11,250,000 outstanding NFL warrants exercisable within 60 days, and 7,668,381 public warrants exercisable within 60 days.
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |||||||
| Non-accelerated filer | ☒ | Emerging growth company | ☒ | |||||||
| † | The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting |
US GAAP ☒ | International Financial Reporting Standards as issued | Other ☐ | ||||||
| by the International Accounting Standards Board |
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“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Genius” means Genius Sports Limited.
“Genius Board” means the board of directors of Genius.
“Genius Governing Documents” means the Genius Amended and Restated Memorandum of Incorporation and the Genius Amended and Restated Articles of Incorporation.
“Genius ordinary shares” means the ordinary shares of Genius, par value $0.01.
“Guernsey Companies Law” means the Companies (Guernsey) Law, 2008 (as amended).
“
On October 27, 2020, dMY Technology Group, Inc. II, a Delaware corporation (“dMY”), entered into a Business Combination Agreement (the “Business Combination Agreement”) with Maven Topco Limited, a company incorporated under the laws of Guernsey (the “TopCo”), Maven Midco Limited, a private limited company incorporated under the laws of England and Wales (“MidCo”), Genius Sports Limited, a company incorporated under the laws of Guernsey (f/k/a Galileo NewCo Limited) (“Genius”), Genius Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Genius (“Merger Sub” and, together with TopCo, MidCo and Genius, the “Target Companies”), and dMY Sponsor II, LLC, a Delaware limited liability company (the “Sponsor”). The transactions contemplated by the Business Combination are referred to herein as the “Business Combination.”
Pursuant to the Business Combination Agreement, at the closing of the Business Combination (the “Closing”), Genius underwent a pre-closing reorganization (the “Reorganization”) wherein all existing classes of shares of TopCo (except for certain preference shares of TopCo which were redeemed and cancelled as part of the Reorganization (the “Redemption”)) were exchanged for newly issued ordinary shares of Genius (“Geniusordinary shares”). As described in the Business Combination Agreement, solely with respect to the shares of TopCo that were unvested prior to such reorganization and because the holders of such shares have executed and delivered support agreements agreeing to the vesting and restrictions provisions therein, such shares were exchanged for Genius ordinary shares but are still subject to the vesting and restrictions as set forth therein (“Restricted Shares”).
Pursuant to the Business Combination Agreement, subject to the satisfaction or waiver of certain conditions set forth therein, the following has occurred: (a) dMY’s issued and outstanding shares of dMY Class B common stock, subject to the terms of the Founder Holder Consent Letter (as defined and described below), have converted automatically on a one-for-one basis into shares of dMY Class A common stock; and (b) Merger Sub has merged with and into dMY, with dMY continuing as the surviving company, as a result of which (i) dMY has become a wholly-owned subsidiary of Genius; (ii) each issued and outstanding unit of dMY, consisting of one share of dMY Class A common stock and one-third of one warrant (the “dMY warrants”), were automatically detached, (iii) each issued and outstanding share of dMY Class A common stock, was converted into the right to receive one Genius ordinary share; (iv) each issued and outstanding dMY warrant to purchase a share of dMY Class A common stock have become exercisable for one Genius ordinary share (the “Genius warrants”); and (v) NewCo changed its name to Genius Sports Limited.
The Business Combination was consummated on April 20, 2021.
| Statement of Operations Data | Successor | Predecessor | ||||||||||||||||
| For the Year Ended December 31, 2020 | For the Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||||
(dollars in thousands except share and per share data) | ||||||||||||||||||
Weighted average common shares outstanding, basic and diluted | 1,873,423 | 1,829,947 | 1,812,601 | 2,983,170 | ||||||||||||||
Net loss per share, basic and diluted | $ | (16.20 | ) | $ (21.97) | $ | (5.38) | $ | (5.20) | ||||||||||
Statement of Cash Flows Data | ||||||||||||||||||
Net cash provided by (used in) operating activities | $ | 17,073 | $ | 2,492 | $ | (193 | ) | $ | 8,839 | |||||||||
Net cash provided by (used in) investing activities | (22,656 | ) | (24,623 | ) | (5,887 | ) | (12,095 | ) | ||||||||||
Net cash provided by (used in) financing activities | 10,096 | 6,931 | (211 | ) | 3,566 | |||||||||||||
| Balance Sheet Data | Successor | |||||||||||||||||
| December 31, 2020 | December 31, 2019 | |||||||||||||||||
Total assets | $ | 391,005 | $ | 375,296 | ||||||||||||||
Total liabilities | 179,757 | 137,853 | ||||||||||||||||
Total temporary equity | 350,675 | 318,805 | ||||||||||||||||
Total shareholders’ deficit | (139,427 | ) | (81,362 | ) | ||||||||||||||
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The following table sets forth our capitalization and indebtedness as of December 31, 2020 on:
a historical basis; and
a pro forma, as adjusted basis, after giving effect to the Business Combination.
| As of December 31, 2020 | ||||||||
| Maven TopCo Limited Actual | Pro Forma Combined | |||||||
| (dollars in thousands) | ||||||||
Cash and cash equivalents | $ | 11,781 | $ | 157,519 | ||||
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Debt | ||||||||
Current debt | 10,272 | 24 | ||||||
Long-term debt - less current portion | 82,723 | 90 | ||||||
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Total debt | 92,995 | 114 | ||||||
Temporary equity | ||||||||
Preference shares | 350,675 | — | ||||||
Stockholders’ equity | ||||||||
Class A common stock | — | 1,677 | ||||||
Common shares | 24 | — | ||||||
Additional paid-in capital | 2,393 | 749,844 | ||||||
Accumulated deficit | (153,237 | ) | (385,606 | ) | ||||
Accumulated other comprehensive income | 11,393 | 11,393 | ||||||
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Total stockholders’ equity | (139,427 | ) | 377,308 | |||||
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Total capitalization | $ | 304,243 | $ | 377,422 | ||||
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Not applicable.
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We and our customers and suppliers are subject to a variety of domestic and foreign laws and regulations, which are subject to change and interpretation and which could subject us to claims or otherwise harm our and our customers’ and suppliers’ respective businesses. Any change in existing regulations or their interpretation, or the regulatory climate and requirements applicable to our or our customers’ and suppliers’ products and services, or changes in tax rules and regulations or interpretation thereof related to our or our customers’ and suppliers’ products and services, could adversely impact our or our customers’ and suppliers’ ability to operate our or their respective businesses as currently conducted or as we seek to operate in the future, which could have a material adverse effect on our financial condition and results of operations.
If we are unable to increase our revenues
The international scope of our operations may expose us to increased risk, and our international operations and corporate and financing structure may expose us to potentially adverse tax consequences.
Risks related todepress the U.K.’s exit from the European Union (“Brexit”) may have a negative effect on global economic conditions, financial markets and our business.
Founders and Sellers, whose interests may differ from those of other holdersmarket price of Genius ordinary shares following the Business Combination, will have the ability to significantly influence Genius’s business and management.
Genius may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on its financial condition, results of operations and share price, which could cause you to lose some or all of your investment.
The unaudited pro forma condensed combined financial information included in the Report may not be indicative of what the combined company’s actual financial position or results of operations would have been.
prospects.
Moreover, as a result of orders issued by governmental authorities around the world, a number of our customers’ operations have been restricted and certain of their properties have been closed. While some of these operations have resumed and properties have reopened, demand for our products and services may continue to be adversely impacted by such closures and restrictions in the future.
COVID-19 could continue to have a material adverse The continued impact on economic and market conditions and trigger a period of continued global economic slowdown. Our business and the businesses of our customers and sports organizations are particularly sensitive to reductions in discretionary consumer spending. Demand for entertainment and leisure activities, including sporting events, sports betting and online gaming, can be affected by changes in the economy and consumer tastes, both of which are difficult to predict and beyond our control. Unfavorable changes in general economic conditions, including recessions, economic slowdowns, sustained high levels of unemployment, and rising prices or the perception by consumers of weak or weakening economic conditions, may reduce consumers’ disposable income or result in fewer individuals engaging in entertainment and leisure activities, such as sporting events, sports betting and online gaming. In particular, the effects of COVID-19 have reduced the coverage we are able to offer to our customers and required us to amend payment terms to reflect this.
If a large number of our employees and/or a subset of our key employees and executives are impacted by COVID-19, our ability to continue to operate effectively may be negatively impacted. We have taken precautionary measures intended to help minimize the risk of the virus to our staff which may disrupt our operations, including limiting access to our physical offices worldwide, requiring employees to work remotely (unless they perform critical functions that cannot be undertaken remotely or have otherwise opted to work from the office as a result of personal circumstances, in each case to the extent possible under relevant government guidelines), and suspending all travel worldwide for our employees pursuant to relevant government restrictions. An extended period of remote-work arrangements could strain our business continuity plans, introduce operational risk, including, but not limited to, cybersecurity risks and risks related to unauthorized access to confidential information, the reduction of our ability to effectively recruit, train and retain employees and the impairment of our ability to effectively manage our business, which may negatively impact our business, results of operations, and financial condition.
The ultimate severity of COVID-19 isremains uncertain at this time and therefore we cannot predict the full impact it may have on our end markets and our operations; however, the effect on our results has been material and adverse, and it may continue to be material and adverse in the future. Any significant or prolonged decrease in sporting events and in consumer spending on entertainment or leisure activities could adversely affect the demand for offerings of our customers and sports organizations and, in turn, our offerings, reducing our cash flows and revenues, and thereby materially harm our business, financial condition, results of operations and prospects.
Our service provisions and operations requires that we recruit, retain and develop personnel from diverse backgrounds across a wide range of expertise areas and geographies. In order to maintain and grow in a competitive market, we require significant intellectual capital in the fields of technology, gaming, customer service and key management functions across various jurisdictions. Failure to retain key positions could result in increased recruitment costs for senior management positions and across competitive markets. If we cannot retain, attract and develop our intellectual capital we may see a decrease in our service provision, data collection, technological development, corporate functionality and operations which could cause slower growth or a loss in interest to competitors which could result in lost revenues and long-term prospects.
We operate
licenses and operate under those licenses in two countries. Any of our licenses could be revoked, suspended or conditioned at any time. Our license applications may also be denied or conditioned. The loss of a license in one jurisdiction could trigger the loss of a license or affect our eligibility for such a license in another jurisdiction, and any of such losses, or potential for such loss, could cause us to cease offering some or all of our offerings in the impacted jurisdictions. As laws and regulations change, we may need to obtain and maintain licenses or registrations in additional jurisdictions. In addition, once licensed, we may be subject to various ongoing requirements, including supervision by the respective governmental agency of certain transfers of ownership and acquisitions.
result.
We are further required to implement various processes around conflicts of interest and related party transactions in order to comply with our obligations under the UK Bribery Act and regulations relating to our listing as a public company. These procedures and processes must be maintained and overseen in various jurisdictions, and even still may not be sufficient to prevent a violation. A violation in our procedures and policies could result in regulatory fines, litigation, risks to the rights of shareholders with respect to a violation of listing rules and disclosures, and public relations risks; all of which could affect our reputation and results of operations. Additionally, the costs, resourcing and impact of compliance may continue as additional requirements are imposed by various regulators. These additional measures may affect our operating costs or financial results.
value of our brand and other intangible assets may be diminished, and competitors may be able to more effectively mimic our product offerings and services. Any of these events could seriously harm our business, financial condition, results of operations and prospects.
outages, data or information loss and fraud; and to prevent or detect security breaches. Such measures include a disaster recovery strategy for server and equipment failure, back-office systems and the use of third parties for certain cybersecurity services. We have experienced, and we may in the future experience, website disruptions, outages and other performance problems due to a variety of factors, including infrastructure changes, human or software errors and capacity constraints. To date, such disruptions have not had a material impact on us, individually or in the aggregate; however, future disruptions from unauthorized access to, fraudulent manipulation of, or tampering with our computer systems and technological infrastructure, or those of third parties, could result in a wide range of negative outcomes, each of which could materially adversely affect our business, financial condition, results of operations and prospects.
systems will be sufficient to prevent data loss. In addition, while we maintain cybersecurity insurance coverage that we believe is adequate for our business, such coverage may not cover all potential costs and expenses associated with cybersecurity incidents that may occur in the future. Actual or anticipated attacks may cause us to incur increasing costs, including costs to deploy additional personnel and protection technologies, train employees and engage third-party experts and consultants.
dMY has identified a material weakness in its
could be adversely affected.
dMY identified a material weakness in its internal control over financial reporting related
To respond to this material weakness, dMY devoted significant effort and resources to the remediation and improvement of its internal control over financial reporting and, following the closing of the Business Combination, we intend to take additional steps to remediate this material weakness, including plans to enhance processes to better evaluate our research and understanding of the nuances of the complex accounting standards that apply to our consolidated financial statements, enhance access to accounting literature, research materials and documents and increase communication among our personnel and third-party professionals with whom we consult regarding complex accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects. For a discussion of dMY’s consideration of the material weakness identified related to our accounting for a significant transaction related to the warrants issued in connection with the August 2020 initial public offering, see “Note 2—Restatement of Previously Issued Financial Statements” to dMY’s consolidated financial statements, as well as Part II, Item 9A: Controls and Procedures included in dMY’s Annual Report on Form 10-K/A.
Following the closing of the Business Combination, we intend to take steps to remediate this material weakness, including increasingincreased the depth and experience within our accounting and finance organization, as well as designing and implementing improved processes and internal controls. However, our efforts to remediate this material weakness may not be effective or prevent any future material weakness or significant deficiency in our internal control over financial reporting. If our efforts are not successful or other material weaknesses or control deficiencies occur in the future, we may be unable to report its financial results accurately on a timely basis, which could cause our reported financial results to be materially misstated and result in the loss of investor confidence and cause the market price of our common stock to decline.
Efforts to remediate this material weakness may not be effective or prevent any future material weakness or significant deficiency in our internal control over financial reporting.
We may face litigation and other risks as a result of the material weakness in our internal control over financial reporting.
Following the issuance of the SEC Staff statement, after consultation with its independent registered public accounting firm, dMY’s management and audit committee concluded that it was appropriate to restate its previously issued audited financial statements as of December 31, 2020 and for the quarterly period ended September 30, 2020. dMY identified a material weakness in its internal controls over financial reporting related to the accounting for a significant transaction related to the warrants issued in connection with dMY’s initial public offering in August 2020.
As a result of such material weakness, the restatement of dMY’s financial statements for the Affected Periods, the change in accounting for the warrants, and other matters raised or that may in the future be raised by the SEC, we face potential for litigation or other disputes which may include, among others, claims invoking the federal and state securities laws, contractual claims or other claims arising from the restatement and material weaknesses in dMY’s internal control over financial reporting and the preparation of its financial statements. As of the date of this Report, we have no knowledge of any such litigation or dispute. However, we can provide no assurance that such litigation or dispute will not arise in the future. Any such litigation or dispute, whether successful or not, could have a material adverse effect on our business and results of operations and financial condition.
If the benefits of the Business Combination do not meet the expectations of investors or securities analysts, the
Ifdecline, and you may not be able to resell Genius’s securities at or above the benefits of the Business Combination do not meet the expectations of investors or securities analysts, theprice at which you purchased them.
time you purchased them.
companies affected. The trading prices and valuations of these stocks, and of Genius ordinary shares, may not be predictable. A loss of investor confidence in the market for the stocks of other companies that investors perceive to be similar to Genius could depress its share price, regardless of its business, prospects, financial conditions or results of operations. A decline in the market price of Genius ordinary shares also could adversely affect Genius’s ability to issue additional securities and its ability to obtain additional financing in the future.
A number
2022.
issuers and may still be responsible for maintaining home country governance requirements in addition to domestic governance requirements.
expenses not currently incurred. These laws and regulations could also make it more difficult or costly for us to obtain certain types of insurance, including director and officer liability insurance, and we may be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. These laws and regulations could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, on our board committees or as our executive officers. Furthermore, if we are unable to satisfy our obligations as a public company, we could be subject to the delisting of our common stock and warrants, fines, penalties sanctions and other regulatory action, public relations risks and potentially civil litigation.
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Genius’
Genius’
rights.
2021.
Genius’
2020.
The results of these surveys are shared with our Audit Committee of the Board from time-to-time. The Company refreshed its various ethical dealings policies in 2021 and continues to rollout new policies, procedures and training to underpin a culture of integrity and ethical behaviour.
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The Company’s
Genius’
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Upon consummation
31 December 2021.
Name | Country of Incorporation and Place of Business | Nature of Business | Proportion of Ordinary Shares Held by Genius | |||||
Maven Topco Limited | Guernsey | Holding company | ||||||
Genius Sports SS Holdings, Inc | United States | Holding company | 100% | |||||
Genius Sports Group Limited | United Kingdom | Holding company | ||||||
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Betgenius Limited | United Kingdom | Data services and technology | 100% | |||||
Genius Sports Media, Inc. | Data services and technology | 100% |
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subsidiaries.
Following the acquisition of Second Spectrum, Inc (“Second Spectrum”), Genius is now a leading provider of cutting-edge data tracking and visualization solutions that partners with elite football and basketball clubs, leagues, federations, and media organizations around the world.
| December 31, | ||||||||||||
| 2020 | 2019 | 2018 | ||||||||||
Events under official sports data and streaming rights | 162,078 | 142,083 | 105,790 | |||||||||
Of which, exclusive | 101,906 | 83,462 | 56,923 | |||||||||
December 31, | ||||||||
2021 | 2020 | |||||||
Events under official rights | 201,216 | 162,078 | ||||||
Of which, exclusive | 128,232 | 101,906 | ||||||
Genius’ sportsbook contracts are typically structured with guaranteed minimum payments throughout the life of the term (typicallyOverApproximately 60% of Genius’ fiscal 20202021 and 20192020 revenue was related to contractual minimum revenue guarantees. The variable revenue components and other material terms in Genius’ sportsbook contracts (for example, geographic use limitations) provide a significant opportunity for growth.
The most significant change in See Consolidated Financial Statements on Form
2021.
The Apax Funds Investment
In connection with the Apax Funds Investment, on September 7, 2018, Genius Sports and its wholly-owned subsidiaries became wholly-owned subsidiaries of Topco. TopcoCompany acquired all of the issued and outstanding equity interests of Genius Sportsin Second Spectrum, Inc (“Second Spectrum”) for a total consideration transferred of $303.2 million. Approximately $35$198.3 million including $115.0 million in cash and $83.3 million in equity, reflecting a working capital adjustment of additional capital$1.1 million in the fourth quarter of fiscal year 2021. Second Spectrum is a leading provider of cutting-edge data tracking and visualization solutions that partners with elite football and basketball clubs, leagues, federations, and media organizations around the world.
The Apax Funds Investment resulted in, among other things, the step-up in basis of Genius’ amortizable intangible assets of approximately $130 million and the establishment of approximately $185 million in goodwill. As a result, Genius recorded higher expense for amortization of intangible assets in the Successor periods than in the Predecessor period, resulting in, among other impacts, higher cost of revenue and lower gross margin. In addition, in connectioneach annual extension, with the Apax Funds Investment, Genius issued $56.2 million in Investor Loan Noteseach warrant entitling NFL to Maven, a subsidiary of a fund advised by Apax, and other shareholders (see “ — Liquidity and Capital Resources — Debt”) and repaid $33.3 million outstanding debt aspurchase one ordinary share of the acquisition date, resulting in higher interest expenseCompany for the Successor periods relativean exercise price of $0.01 per warrant share. The warrants will be subject to vesting over the Predecessor period. See Note 9 — Debt, to Genius’ audited consolidated financial statements for further details.
Genius does not hedge its foreign currency translation or transaction exposure, though it may do so in the future.
races.
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | September 8 through December 31, 2018 | January 1 through September 7, 2018 | |||||||||||||
| (dollars, in thousands) | ||||||||||||||||
Revenue by Product Group | ||||||||||||||||
Betting Technology, Content and Services | $ | 110,618 | $ | 88,370 | $ | 21,581 | $ | 47,531 | ||||||||
Sports Technology and Services | 16,066 | 14,367 | 5,187 | 3,741 | ||||||||||||
Media Technology, Content and Services | 23,055 | 11,883 | 3,810 | 5,735 | ||||||||||||
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Total Revenue | $ | 149,739 | $ | 114,620 | $ | 30,578 | $ | 57,007 | ||||||||
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Year Ended | Year Ended | Year Ended | ||||||||||
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
(dollars, in thousands) | ||||||||||||
Revenue by Product Group | ||||||||||||
Betting Technology, Content and Services | $ | 177,201 | $ | 110,618 | $ | 88,370 | ||||||
Media Technology, Content and Services | 48,312 | 23,055 | 11,883 | |||||||||
Sports Technology and Services | 37,222 | 16,066 | 14,367 | |||||||||
Total Revenue | $ | 262,735 | $ | 149,739 | $ | 114,620 | ||||||
Sports Technology and Services – revenue is primarily generated through the delivery of technology that enables sports leagues and federations to capture, manage and distribute their official sports data, along with other tools and services, including software updates and technical support. These software solutions are tailored for specific sports. Genius primarily receives noncash consideration in the form of official sports data and streaming rights, along with other rights, in exchange for these services, particularly to non-Tier 1 sports organizations. Because there is not a readily determinable fair value for these unique data rights, Genius estimates the fair value of noncash consideration based on the standalone selling price of the services promised to customers. Revenue is recognized either ratably over the contract term or as the services are provided, by event or season, depending on the nature of the underlying promised product or service.
equipment.
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | September 8 through December 31, 2018 | January 1 through September 7, 2018 | |||||||||||||
| (dollars, in thousands) | ||||||||||||||||
Consolidated net loss | $ | (30,348 | ) | $ | (40,207 | ) | $ | (9,761 | ) | $ | (15,527 | ) | ||||
Adjusted for: | ||||||||||||||||
Net, interest expense | 7,874 | 6,840 | 1,744 | 2,363 | ||||||||||||
Income tax expense (benefit) | 1,813 | (5,366 | ) | (1,258 | ) | 104 | ||||||||||
Amortization of acquired intangibles (1) | 21,571 | 21,412 | 6,820 | — | ||||||||||||
Other depreciation and amortization (2) | 14,010 | 6,793 | 451 | 10,600 | ||||||||||||
Transaction expenses | 672 | 1,005 | — | 5,694 | ||||||||||||
Litigation and related costs (3) | 2,295 | 516 | 1,203 | 23 | ||||||||||||
Other (4) | (377 | ) | 2,799 | (165 | ) | (1,959 | ) | |||||||||
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Adjusted EBITDA | $ | 17,510 | $ | (6,208 | ) | $ | (966 | ) | $ | 1,298 | ||||||
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Year Ended | Year Ended | Year Ended | ||||||||||
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
(dollars, in thousands) | ||||||||||||
Consolidated net loss | $ | (592,753 | ) | $ | (30,348 | ) | $ | (40,207 | ) | |||
Adjusted for: | ||||||||||||
Net, interest expense | 3,331 | 7,874 | 6,840 | |||||||||
Income tax expense (benefit) | (11,701 | ) | 1,813 | (5,366 | ) | |||||||
Amortization of acquired intangibles (1) | 37,617 | 21,571 | 21,412 | |||||||||
Other depreciation and amortization (2) | 22,542 | 14,010 | 6,793 | |||||||||
Stock-based compensation (3) | 489,474 | — | — | |||||||||
Transaction expenses | 12,886 | 672 | 1,005 | |||||||||
Litigation and related costs (4) | 4,395 | 2,295 | 516 | |||||||||
Change in fair value of derivative warrant liabilities | 11,412 | — | — | |||||||||
(Gain) loss on fair value remeasurement of contingent consideration | 19,405 | (271 | ) | — | ||||||||
Other (5) | 4,942 | (106 | ) | 2,799 | ||||||||
Adjusted EBITDA | $ | 1,550 | $ | 17,510 | $ | (6,208 | ) | |||||
| (1) | Includes amortization of intangible assets generated through business acquisitions, inclusive of amortization for data rights, marketing products, and acquired technology. |
| (2) | Includes depreciation of Genius’ property and equipment, amortization of contract cost, and amortization of internally developed software and other intangible assets. Excludes amortization of intangible assets generated through business acquisitions. |
| (3) | Includes restricted shares and stock options granted to employees and directors and equity-classified non-employee awards issued to suppliers. |
| (4) | Includes mainly legal and related costs in connection with non-routine litigation matters including Sportradar litigation and BetConstruct |
Includes gain/losses on disposal of assets, earn-out payments on |
Results
Year Ended | Variance | |||||||||||||||
December 31, 2021 | December 31, 2020 | In dollars | In % | |||||||||||||
(dollars, in thousands) | ||||||||||||||||
Revenue | $ | 262,735 | $ | 149,739 | $ | 112,996 | 75 | % | ||||||||
Cost of revenue (1) | 476,168 | 114,066 | 362,102 | 317 | % | |||||||||||
Gross (loss) profit | (213,433 | ) | 35,673 | (249,106 | ) | (698 | %) | |||||||||
Operating expenses: | ||||||||||||||||
Sales and marketing (1) | 27,292 | 13,176 | 14,116 | 107 | % | |||||||||||
Research and development (1) | 26,513 | 11,240 | 15,273 | 136 | % | |||||||||||
General and administrative (1) | 293,168 | 31,623 | 261,545 | 827 | % | |||||||||||
Transaction expenses | 12,886 | 672 | 12,214 | 1,818 | % | |||||||||||
Total operating expense | 359,859 | 56,711 | 303,148 | 535 | % | |||||||||||
Loss from operations | (573,292 | ) | (21,038 | ) | (552,254 | ) | 2,625 | % | ||||||||
Interest expense, net | (3,331 | ) | (7,874 | ) | 4,543 | (58 | %) | |||||||||
Loss on disposal of assets | (46 | ) | (8 | ) | (38 | ) | 475 | % | ||||||||
Gain (loss) on fair value remeasurement of contingent consideration | (19,405 | ) | 271 | (19,676 | ) | (7,261 | %) | |||||||||
Change in fair value of derivative warrant liabilities | (11,412 | ) | — | (11,412 | ) | — | ||||||||||
Gain (loss) on foreign currency | 3,032 | 114 | 2,918 | 2,560 | % | |||||||||||
Total other income (expenses) | (31,162 | ) | (7,497 | ) | (23,665 | ) | 316 | % | ||||||||
Loss before income taxes | (604,454 | ) | (28,535 | ) | (575,919 | ) | 2,018 | % | ||||||||
Income tax benefit (expense) | 11,701 | (1,813 | ) | 13,514 | (745 | %) | ||||||||||
Net loss | $ | (592,753 | ) | $ | (30,348 | ) | $ | (562,405 | ) | 1,853 | % | |||||
| (1) | Includes stock-based compensation as follows: |
Year Ended | Variance | |||||||||||||||
December 31, 2021 | December 31, 2020 | In dollars | In % | |||||||||||||
(dollars, in thousands) | ||||||||||||||||
Cost of revenue | $ | 243,512 | $ | — | $ | 243,512 | — | |||||||||
Sales and marketing | 3,546 | — | 3,546 | — | ||||||||||||
Research and development | 4,670 | — | 4,670 | — | ||||||||||||
General and administrative | 237,746 | — | 237,746 | — | ||||||||||||
Total stock-based compensation | $ | 489,474 | $ | — | $ | 489,474 | — | |||||||||
| Successor | Variance | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | In dollars | In% | |||||||||||||
| (dollars, in thousands) | ||||||||||||||||
Revenue | $ | 149,739 | $ | 114,620 | $ | 35,119 | 31 | % | ||||||||
Cost of revenue | 114,066 | 89,311 | 24,755 | 28 | % | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Gross profit | 35,673 | 25,309 | 10,364 | 41 | % | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Operating expenses: | ||||||||||||||||
Sales and marketing | $ | 13,176 | $ | 17,711 | $ | (4,535 | ) | (26 | %) | |||||||
Research and development | 11,240 | 13,290 | (2,050 | ) | (15 | %) | ||||||||||
General and administrative | 31,623 | 29,492 | 2,131 | 7 | % | |||||||||||
Transaction expenses | 672 | 1,005 | (333 | ) | (33 | %) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Total operating expense | 56,711 | 61,498 | (4,787 | ) | (8 | %) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Loss from operations | (21,038 | ) | (36,189 | ) | 15,151 | (42 | %) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Interest income (expense), net | (7,874 | ) | (6,840 | ) | (1,034 | ) | 15 | % | ||||||||
Gain (loss) on disposal of assets | (8 | ) | (7 | ) | (1 | ) | 14 | % | ||||||||
Gain on fair value remeasurement of contingent consideration | 271 | — | 271 | nm | ||||||||||||
Gain (loss) on foreign currency | 114 | (2,537 | ) | 2,651 | (104 | %) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Total other income (expenses) | (7,497 | ) | (9,384 | ) | 1,887 | (20 | %) | |||||||||
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|
|
|
|
|
|
| |||||||||
Loss before income taxes | (28,535 | ) | (45,573 | ) | 17,038 | (37 | %) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Income tax benefit (expense) | (1,813 | ) | 5,366 | (7,179 | ) | (134 | %) | |||||||||
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|
|
|
|
|
| |||||||||
Net loss | $ | (30,348 | ) | $ | (40,207 | ) | $ | 9,859 | (25 | %) | ||||||
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| |||||||||
Year Ended | Variance | |||||||||||||||
December 31, 2020 | December 31, 2019 | In dollars | In % | |||||||||||||
(dollars, in thousands) | ||||||||||||||||
Revenue | $ | 149,739 | $ | 114,620 | $ | 35,119 | 31 | % | ||||||||
Cost of revenue | 114,066 | 89,311 | 24,755 | 28 | % | |||||||||||
Gross profit | 35,673 | 25,309 | 10,364 | 41 | % | |||||||||||
Operating expenses: | ||||||||||||||||
Sales and marketing | 13,176 | 17,711 | (4,535 | ) | (26 | %) | ||||||||||
Research and development | 11,240 | 13,290 | (2,050 | ) | (15 | %) | ||||||||||
General and administrative | 31,623 | 29,492 | 2,131 | 7 | % | |||||||||||
Transaction expenses | 672 | 1,005 | (333 | ) | (33 | %) | ||||||||||
Total operating expense | 56,711 | 61,498 | (4,787 | ) | (8 | %) | ||||||||||
Loss from operations | (21,038 | ) | (36,189 | ) | 15,151 | (42 | %) | |||||||||
Interest income (expense), net | (7,874 | ) | (6,840 | ) | (1,034 | ) | 15 | % | ||||||||
Gain (loss) on disposal of assets | (8 | ) | (7 | ) | (1 | ) | 14 | % | ||||||||
Gain on fair value remeasurement of contingent consideration | 271 | — | 271 | nm | ||||||||||||
Gain (loss) on foreign currency | 114 | (2,537 | ) | 2,651 | (104 | %) | ||||||||||
Total other income (expenses) | (7,497 | ) | (9,384 | ) | 1,887 | (20 | %) | |||||||||
Loss before income taxes | (28,535 | ) | (45,573 | ) | 17,038 | (37 | %) | |||||||||
Income tax benefit (expense) | (1,813 | ) | 5,366 | (7,179 | ) | (134 | %) | |||||||||
Net loss | $ | (30,348 | ) | $ | (40,207 | ) | $ | 9,859 | (25 | %) | ||||||
Media Technology, Content and Services revenue increased $11.2 million, or 94%, from $11.9 million for the year ended December 31, 2019 (Successor) to $23.1 million for the year ended December 31, 2020 (Successor), primarily driven by the acquisition of new customers in the Americas and Europe primarily for programmatic advertising services.
2019.
Year Endedthe year ended December 31, 2019 Compared to the Successor Period from September 8 through December 31, 2018 and the Predecessor Period from January 1 through September 7, 2018
The following table summarizes Genius’ consolidated results of operations for the years indicated. The acquisition of Genius Sports by Topco, in connection with the Apax Funds Investment resulted in a change in accounting basis and the financial statement presentation distinguishes results for the “Successor” periods following the Apax Funds Investment from the “Predecessor” period, from January 1, 2018 through September 7, 2018. See “—Factors Affecting Comparability of Financial Information—The Apax Funds Investment.”
| Successor | Predecessor | |||||||||||
| Years Ended December 31, | September 8 through December 31, | January 1 through September 7, | ||||||||||
| 2019 | 2018 | 2018 | ||||||||||
| (dollars in thousands) | ||||||||||||
Revenue | $ | 114,620 | $ | 30,578 | $ | 57,007 | ||||||
Cost of Revenue | 89,311 | 20,780 | 31,026 | |||||||||
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|
|
|
| |||||||
Gross Profit | 25,309 | 9,798 | 25,981 | |||||||||
|
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| |||||||
Operating expenses: | ||||||||||||
Sales and marketing | $ | 17,711 | $ | 4,300 | $ | 9,334 | ||||||
Research and development | 13,290 | 6,862 | 9,555 | |||||||||
General and administrative | 29,492 | 8,076 | 9,195 | |||||||||
Transaction expenses | 1,005 | — | 5,694 | |||||||||
|
|
|
|
|
| |||||||
Total operating expense | 61,498 | 19,238 | 33,778 | |||||||||
|
|
|
|
|
| |||||||
Loss from operations | (36,189 | ) | (9,440 | ) | (7,797 | ) | ||||||
|
|
|
|
|
| |||||||
Loss on warrant and derivative remeasurement | — | — | (7,222 | ) | ||||||||
Interest income (expense), net | (6,840 | ) | (1,744 | ) | (2,363 | ) | ||||||
Gain (loss) on disposal of assets | (7 | ) | (5 | ) | 12 | |||||||
Gain on sale of equity method investment | — | — | 1,800 | |||||||||
Gain (loss) on foreign currency | (2,537 | ) | 170 | 147 | ||||||||
|
|
|
|
|
| |||||||
Total other income (expenses) | (9,384 | ) | (1,579 | ) | (7,626 | ) | ||||||
|
|
|
|
|
| |||||||
Loss before income taxes | (45,573 | ) | (11,019 | ) | (15,423 | ) | ||||||
Income tax benefit (expense) | 5,366 | 1,258 | (104 | ) | ||||||||
|
|
|
|
|
| |||||||
Net loss | $ | (40,207 | ) | $ | (9,761 | ) | $ | (15,527 | ) | |||
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| |||||||
Revenue
Revenue was $57.0 million for the 2018 Predecessor period and $30.6 million for the 2018 Successor period compared to $114.6 million for fiscal 2019. On a pro forma basis, assuming the Apax Funds Investment occurred on January 1, 2018, revenue increased $27.0 million, or 31%, from $87.6 million in fiscal 2018 to $114.6 million in fiscal 2019. On a pro forma constant currency basis, revenue would have increased $30.6 million, or 37%, in fiscal 2019 compared with fiscal 2018.
On a pro forma basis, Betting Technology, Content and Services revenue increased $19.3 million, or 28%, from $69.1 million in fiscal 2018 to $88.4 million in fiscal 2019. This increase was primarily due to growth of business with existing customers as a result price increases on contract renewals and renegotiations, expansion of value-add services, new service offerings, and the acquisition of new customers in fiscal 2019, as Genius gained critical mass through its data rights acquisition strategy. Events under official data rights increased from 105,790 as of December 31, 2018 to 142,083 as of December 31, 2019.
On a pro forma basis, Sports Technology and Services revenue increased $5.4 million, or 61%, from $8.9 million in fiscal 2018 to $14.4 million in fiscal 2019, primarily driven by continued relationships with sports leagues and federations across all tiers of sport. Revenue for contracts where Genius receives noncash consideration in the form of official sports data and streaming rights was $7.9 million in fiscal 2019 compared to $3.3 million in fiscal 2018.
On a pro forma basis, Media Technology, Content and Services revenue increased $2.3 million, or 24%, from $9.5 million in fiscal 2018 to $11.9 million in fiscal 2019, primarily driven by the acquisition of new customers in the Americas and Europe primarily for programmatic advertising services.
Cost of revenue
Cost of revenue was $31.0 million for the 2018 Predecessor period and $20.8 million for the 2018 Successor period, compared to $89.3 million for fiscal 2019. The trend in cost of revenue in fiscal 2019 is primarily related to increased data rights costs and amortization of acquired intangible assets.
Data rights costs were $3.7 million in the 2018 Predecessor period, $5.7 million in the 2018 Successor period, and $23.8 million for fiscal 2019, with the fiscal 2019 amount driven primarily by Genius’ entry into its exclusive U.K. soccer data rights contract in May 2019 and other lower tiered sports. Amortization of acquired intangible assets was $6.8 million for the 2018 Successor period and $21.4 million for fiscal 2019. Amortization of capitalized software development costs was $9.0 million in the 2018 Predecessor period, $0.2 million for the 2018 Successor period and $4.9 million for fiscal 2019. In addition, increases in data collection, media related, and server costs in fiscal 2019 contributed to the trend.
Sales and marketing
Sales and marketing expenses were $9.3 million for the 2018 Predecessor period and $4.3 million for the 2018 Successor period, compared to $17.7 million for fiscal 2019. The increase in fiscal 2019 reflects growing staff costs and sponsorships, roughly in line with Genius’ revenue growth as Genius ventures into new markets.
Research and development
Research and development expenses were $9.6 million for the 2018 Predecessor period and $6.9 million for the 2018 Successor period, compared to $13.3 million for fiscal 2019. The decrease in fiscal 2019 was primarily driven by Genius capitalizing a significant portion of internally developed software costs in the period as a result of new products completing the preliminary project stage and became probable of completion in the period. This decrease was partially offset by higher staff costs in the period driven by an increase in headcount in fiscal 2019.
General and administrative
General and administrative expenses were $9.2 million for the 2018 Predecessor period and $8.1 million for the 2018 Successor period, compared to $29.5 million for fiscal 2019. The increase in fiscal 2019 was due mainly to Genius’ continued geographic and market expansion, which resulted in increases to corporate costs, including staff, legal, professional, and other ancillary costs.
Transaction expenses
Transaction expenses were $5.7 million for the 2018 Predecessor period and $1.0 million for fiscal 2019. The transaction expenses for the 2018 Predecessor period related to sell-side transaction costs incurred in connection with the Apax Funds Investment.
Warrant and derivative adjustment
Warrant and derivative remeasurement expense was $7.2 million for the 2018 Predecessor period, reflecting the settlement of the warrants and certain loan instruments in connection with the Apax Funds Investment.
Interest expense, net
Interest expense, net was $2.4 million for the 2018 Predecessor period and $1.7 million for the 2018 Successor period, compared to $6.8 million for fiscal 2019. The increase in fiscal 2019 corresponds with the increase in outstanding debt on Investor Loan Notes issued in connection with the Apax Funds Investment.
Gain on sale of equity method investment
Genius sold an equity method investment, in a company named PointsBet, in the 2018 Predecessor period, resulting in a gain on sale of $1.8 million.
Foreign currency gain (loss)
Genius recorded a foreign currency gain of $0.1 million for the 2018 Predecessor period, gain of $0.2 million for the 2018 Successor period, and a $2.5 million foreign currency loss for fiscal 2019. The loss in fiscal 2019 was mainly due to GBP exchange rate volatility, reflecting the effects the U.K’s withdrawal from the European Union.
Income tax benefit (expense)
Income tax benefit (expense) was an expense of $0.1 million for the 2018 Predecessor period, a $1.3 million benefit for the 2018 Successor period and a $5.4 million benefit for fiscal 2019. The increase in benefit in fiscal 2019 was due to the corresponding increase in net loss before income taxes.
Net loss
Net loss was $15.5 million for the 2018 Predecessor period, $9.8 million for the 2018 Successor period2020 and $40.2 million for fiscalthe year ended December 31, 2019.
Genius had $11.8 million in cash and cash equivalents as of December 31, 2020. On a pro forma basis, assuming the Business Combination closed on that date, cash and cash equivalents would have been $157.5 million. Management believes Genius’ operating cash flows, together with amounts available under its Overdraft Facility (as defined below), its cash on hand and the cash it expects to obtain as a result of the Business Combination (including the proceeds of the PIPE Investment, as discussed above under “Summary of the Material Terms of the Business Combination”), will be sufficient to meet its working capital and capital expenditure requirements for a period of at least twelve months from the date of this Annual Report on Form 20-F.
expenditure requirements for the next twelve months. To the extent that its current resources are insufficient to satisfy its cash requirements, Genius may need to seek additional equity or debt financing. If the needed financing is not available, or if the terms of financing are less desirable than expected, Genius may be forced to decrease its level of investment in new product launches and related marketing initiatives or to scale back its existing operations, which could have an adverse impact on its business and financial prospects.
Merger.
20-F for disclosures regarding our commitments, including our contractual obligations.
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | September 8 through December 31, 2018 | January 1 through September 7, 2018 | |||||||||||||
| (dollars in thousands) | ||||||||||||||||
Net cash provided by (used in) operating activities | $ | 17,073 | $ | 2,492 | $ | (193 | ) | $ | 8,839 | |||||||
Net cash provided by (used in) investing activities | (22,656 | ) | (24,623 | ) | (5,887 | ) | (12,095 | ) | ||||||||
Net cash provided by (used in) financing activities | 10,096 | 6,931 | (211 | ) | 3,566 | |||||||||||
indicated:
Year Ended | Year Ended | Year Ended | ||||||||||
December 31, 2021 | December 31, 2020 | December 31, 2019 | ||||||||||
(dollars, in thousands) | ||||||||||||
Net cash provided by (used in) operating activities | $ | (63,308 | ) | $ | 17,073 | $ | 2,492 | |||||
Net cash provided by (used in) investing activities | (132,319 | ) | (22,656 | ) | (24,623 | ) | ||||||
Net cash provided by (used in) financing activities | 410,364 | 10,096 | 6,931 | |||||||||
For the year ended December 31,in 2019. In 2020, (Successor), net cash provided by operating activities primarily reflected the impact of Genius’ net income net of fiscal 2019, cash provided by operating activities reflected primarily by the change in working capital of $11.5 million, offset by net loss net of
Investing activities
property and equipment of $1.5 million.
For the year ended December 31,In 2020, (Successor), investing cash flows primarily reflect internally developed software costs and purchases of $15.9intangible assets of $17.3 million, andthe acquisition of Sportzcast, Inc. of $3.9 million and purchases of property and equipment of $1.5 million. For the year ended December 31,In 2019, investing cash flows primarily reflect internally developed software costs of $20.8 million and purchases of property and equipment of $3.2 million.
Financing activities
Related Party Loan. See “Liquidity and Capital Resources — Debt” above for applicable interest rates and other relevant terms.
Net cash provided by financing activities was $6.9 million
Contractual Obligations, Commitments and Contingencies
The following table and the information that follows summarizes Genius’ contractual commitments for the payment of cash as of December 31, 2020 (Successor).
| Payments Due by Period | ||||||||||||||||||||
| Total | Less than 1 Year | 1 - 3 Years | 3 - 5 Years | More than 5 years | ||||||||||||||||
| (dollars, in thousands) | ||||||||||||||||||||
Contractual Obligations: | ||||||||||||||||||||
Operating lease obligations (1) | $ | 20,400 | $ | 5,209 | $ | 9,922 | $ | 5,269 | $ | — | ||||||||||
Debt (2) | 92,995 | 10,272 | 49 | 48 | 82,626 | |||||||||||||||
Data license agreements (3) | 137,236 | 35,414 | 68,819 | 26,034 | 6,969 | |||||||||||||||
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| |||||||||||
Total | $ | 250,631 | $ | 50,895 | $ | 78,790 | $ | 31,351 | $ | 89,595 | ||||||||||
|
|
|
Investor Commitment
Certain investment funds affiliated with Apax Funds provided Maven Debtco Limited (“Maven Debtco”), an affiliate of Genius, with a commitment letter in support of a guarantee issued by Maven Debtco to Barclays Bank PLC in connection with a bank guarantee, drawable for an aggregate amount of up to £30 million, that Barclays provided to Football Dataco Limited to secure Genius’ obligations under its exclusive EPL data rights agreement. Genius intends to terminate this commitment at or anytime in the one year following consummation of the Business Combination.
Off-Balance Sheet Arrangements
As of December 31, 2020 (Successor), Genius did not have any off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K.
Name | Age | Position | ||||
Mark Locke | 42 | Director and Chief Executive Officer | ||||
David Levy | 59 | |||||
Albert Costa Centena | 37 | Director | ||||
Gabriele Cipparrone | 46 | Director | ||||
| 53 | Director | ||||
| 41 | Director | ||||
| 62 | Director | ||||
| 51 | Director | ||||
| Director | |||||
| Nicholas Taylor | 47 | Chief Financial Officer | ||||
Steven Burton | 50 | Chief Operating Officer | ||||
Jack Davison | 45 | Chief Commercial Officer | ||||
Campbell Stephenson | 46 | Chief Information Officer | ||||
| Tom Russell | 42 | Chief Legal Officer |
Albert Costa Centena
Genius Sports Group Limited.
Genius Sports Group Limited.
Mr. You served as executive vice president and chief financial officer of Oracle, and was also a member of the board of directors of Oracle Japan. From 2001 to 2004, Mr. You served as chief financial officer of Accenture. Mr. You also previously spent fourteen years on Wall Street, including serving as a managing director in the Investment Banking Division of Morgan Stanley, where he headed the Computer and Business Services Group. Mr. You has served as a member of the board of directors of Broadcom Inc. since January 2019. Mr. You holds an M.A. in Economics from Yale University and a B.A. in Economics from Harvard College. Mr. You’s qualifications to serve on our board of directors include his extensive and varied deal experience throughout his career, including his experience structuring Dell’s acquisition of EMC as EMC’s executive vice president, his network of contacts in the technology sector, and his prior special purpose acquisition company experience with GTY.
Daniel Burns is a member of Genius’s board of directors and has served as a member of the Board of Directors of TopCo since September 2018. Since 2011, Mr. Burns
Roxana Mirica is as a member of Genius’s board of directors. SheRussell is a Partnerqualified solicitor in England and headWales.
development industry.
Steven Burton has served as the Chief Operating Officer
|
Historical
Historical
(U.S. dollars in thousands)(1) | All executive officers | |||
Base compensation(2) | $ | 1,477.218 | ||
Bonuses(3) | $ | 1,508.348 | ||
Additional benefit payments(4) | $ | 18,358 | ||
Total cash compensation | $ | 3,003.924 | ||
(U.S. dollars in thousands)(1) | All executive officers | |||
Base compensation(2) | $ | 2,225,160 | ||
Bonuses(3) | $ | 1,616,752 | ||
Additional benefit payments(4) | $ | 24,211 | ||
Total cash compensation | $ | 3,866,123 | ||
| (1) | Amounts payable in pound sterling have been converted into U.S. dollars using the calendar year |
| (2) | Base compensation represents the actual salary amounts paid to executive officers in |
| (3) | With respect to the bonuses referenced above, Genius may, on occasion and if appropriate, make discretionary annual awards to members of its senior management team or other staff who have displayed exceptional performance or otherwise gone above and beyond in their efforts on behalf of Genius during the prior year. Bonuses are payable solely at the discretion of |
| (4) | Additional benefits include employer pension contributions and provision of private medical insurance cover. |
Historical
With the exception
Pursuant2021 was $910,000, comprised of $130,000 cash based compensation and $780,000 share based compensation.
1.3760.
Certain members of Genius’s management team held incentive shares issued by TopCo (the “Existing Incentive Shares”), subject to the terms of a management investment deed (“Management Investment Deed”) and TopCo’s Articles of Incorporation, which set out, among other things, the terms on which such Existing Incentive
Shares are issued to, and held by, the relevant members of the Genius management team, the basis on which such Existing Incentive Shares will vest and the repurchase and transfer provisions that apply to such Existing Incentive Shares (including those that apply if the relevant member of the Genius management team ceases to be employed or engaged by TopCo or any of its subsidiary undertakings, referred to as “Leavers”).
Executive | Unrestricted Ordinary Shares | Restricted Ordinary Shares | Total Ordinary Shares | % of Total Outstanding Shares | ||||||||||||
Mark Locke (CEO) | 16,368,395 | 5,192,079 | 21,560,474 | 10.6 | % | |||||||||||
Nick Taylor (CFO) | 712,856 | 888,185 | 1,601,041 | * | ||||||||||||
Steven Burton (COO) | 995,439 | 429,745 | 1,425,184 | * | ||||||||||||
Jack Davison (CCO) | 1,104,233 | 429,745 | 1,533,978 | * | ||||||||||||
Campbell Stephenson (CIO) | 1,485,412 | 429,745 | 1,915,157 | * | ||||||||||||
Tom Russell (CLO) | 536,397 | 255,146 | 791,543 | * | ||||||||||||
| * | ||||||||||||||||||||||||||||
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less than 1% | ||||||||||||||||||||
Genius has established a
Pursuant to the terms
Share pursuant to the Reorganization),varies) and certain of them are also subject to performance vesting conditions (measured after the effective time of the Business Combination based on the volume weighted average trading price performance of Genius ordinary shares, over a period of up to four years).
The Management Investment Deed provides
Director Compensation
The board
|
phase-in period expires.
Board and appointments of officers and executive officers. Mr. Cipparrone and Mr. You are independent under the applicable rules of the SEC and the NYSE.
reviewing related person transactions; and
|
Following and as a result of the Business Combination, the business of the Company is conducted through Genius Sports Group Limited, its subsidiary.
2SL, England.
|
vote.
Beneficial Owners | Number of Genius Shares | Approximate Percentage of Outstanding Shares | ||||||
Directors and Executive Management | ||||||||
Mark Locke(1) | 23,121,602 | 12.9 | % | |||||
David Levy(1) | 36,495 | * | ||||||
Albert Costa Centena(1) | — | — | ||||||
Gabriele Cipparrone(1) | — | — | ||||||
Roxana Mirica(1) | — | — | ||||||
Niccolo de Masi (2) | — | — | ||||||
Harry L. You(2) (3) (4) | 6,825,000 | 3.8 | % | |||||
Daniel Burns(1) | 81,364 | * | ||||||
Nicholas Taylor(1) | 1,669,894 | * | ||||||
Steven Burton(1) | 1,524,568 | * | ||||||
Jack Davison(1) | 1,613,978 | * | ||||||
Campbell Stephenson(1) | 1,915,157 | 1.0 | % | |||||
All directors and executive officers as a group (12 persons) | 36,788,058 | 20.6 | % | |||||
Other 5% Shareholders | ||||||||
Maven TopHoldings SARL(5) | 66,644,038 | 37.3 | % | |||||
Funds and Accounts Managed by Caledonia(6) | 14,000,000 | 7.8 | % | |||||
NFL Enterprises, LLC (7) | 11,250,000 | 5.9 | % | |||||
Beneficial Owner | Number of Genius Shares | Approximate Percentage of Outstanding Shares | ||||||
Directors and executive officers | ||||||||
Mark Locke (1) | 21,560,474 | 10.6 | % | |||||
David Levy (1) | 61,495 | * | ||||||
Albert Costa Centena (1) | — | — | ||||||
Gabriele Cipparrone (1) | — | — | ||||||
Roxana Mirica (1) | — | — | ||||||
Niccolo de Masi (2) (3) | 2,400,000 | * | ||||||
Harry L. You (2) (4) | 2,400,000 | * | ||||||
Daniel Burns (1) (5) | 88,844 | * | ||||||
Kimberly Bradley (1) | 5,747 | * | ||||||
Nicholas Taylor (1) | 1,601,041 | * | ||||||
Steven Burton (1) | 1,425,184 | * | ||||||
Jack Davison (1) | 1,533,978 | * | ||||||
Campbell Stephenson (1) | 1,915,157 | * | ||||||
Tom Russell (1) | 791,543 | * | ||||||
All directors and executive officers as a group (14 persons) | 33,783,463 | 16.6 | % | |||||
Other 5% shareholders | ||||||||
Maven TopHoldings SARL (6) | 60,212,336 | 29.7 | % | |||||
Funds and Accounts Managed by Caledonia (7) | 18,444,075 | 9.1 | % | |||||
Alger Associates Inc. (8) | 12,756,592 | 6.3 | % | |||||
NFL Enterprises, LLC (9) | 11,250,000 | 5.3 | % | |||||
| * | Less than |
| (1) | The business address of this shareholder is |
| (2) | The business address of this shareholder is |
| (3) |
|
Isalea Investments LP is the record holder of the shares reported herein. |
| (4) | Includes 2,300,000 Genius ordinary shares directly held by RHY 2021 Irrevocable Trust. Harry L. You has the |
| (5) |
Includes 7,480 Genius ordinary shares directly held by |
| (6) | Based solely on the |
| (7) | Based solely on the |
|
| (8) | Based solely on the Schedule 13G filed by Alger Associates, Inc., th Floor, New York, |
NFL Enterprises, LLC (“ |
|
Also, on April 26, 2021, pursuant to the License Agreement, NFL Enterprises was issued 18,500,000 NFL Warrants, of which 11,250,000 were vested immediately upon issuance and the balance will vest over the License Agreement’s remaining term or upon certain limited specified events and on customary terms. Each NFL Warrant entitles NFL Enterprises to purchase one Genius ordinary share (each, a “NFL Warrant Share”) for an exercise price of $0.01 per share. Each NFL Warrant was issued along with, and was stapled to, one B Share representing an economic value equal to the $0.0001 par value per share, and entitling the holder thereof to vote with the holders of the ordinary shares of Genius on the basis of 1/10 of a vote per B share. Upon each purchase of a NFL Warrant Share pursuant to the exercise of a NFL Warrant, each B share attached to such NFL Warrant shall automatically be repurchased or, in the Company’s discretion, redeemed by the Company and cancelled at par value, in each case, in accordance with the Genius governing documents.
Amended and Restated
In contemplation of the Additional Public Offering, the Company waived the applicable lock-up restrictions under the Amended and Restated Investor Rights Agreement for those selling shareholders in the Additional Public Offering who are party thereto, solely with respect to the portion of their ordinary shares offered for sale in the Additional Public Offering to the extent required to permit them to sell in the Additional Public Offering. Further, we have filed the Resale F-1 to satisfy our obligations to register the offer and sale of ordinary shares by certain of our shareholders pursuant to the Investor Rights Agreement and Subscription Agreements. The Resale F-1 was declared effective on June 1, 2021, upon which their ordinary shares have become freely tradable, subject to any applicable lock-up provisions in the Amended and Restated Investor Rights Agreement.
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Pro Forma Condensed Combined Financial Information
Defined terms included below shall have the same meaning as terms defined and included elsewhere in this Report on Form 20-F and, if not defined in the Form 20-F, the Registration Statement on Form F-4 filed with the Securities and Exchange Commission (the “SEC”) on March 26, 2021. Unless the context otherwise requires, the “Company” refers to Galileo NewCo Limited and its subsidiaries after the Closing, and dMY Technology Group, Inc. II prior to the Closing.
NewCo is providing the following unaudited pro forma condensed combined financial information to aid you in your analysis of the financial aspects of the Business Combination. The following unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X.
NewCo was formed on October 21, 2020 for the purpose of effectuating the Business Combination described herein. NewCo has no material assets and does not operate any businesses. Accordingly, no financial statements of NewCo have been included in this Form 20-F.
TopCo was formed on July 18, 2018 as a non-cellular company limited by shares under the laws of Guernsey in connection with Apax Funds Investment in Genius. On September 7, 2018, TopCo, through its wholly owned subsidiary Bidco, acquired all outstanding equity interests in Genius and its wholly-owned subsidiaries. TopCo accounted for the acquisition as a business combination using the acquisition method of accounting. Genius is a B2B provider of scalable, technology-led products and services to the sports, sports wagering and sports media industries. Genius is a fast-growing business with significant scale, distribution and an expanding addressable market and opportunity ahead. Genius’ mission is to be the official data, technology and commercial partner that powers the global ecosystem connecting sports, betting and media.
dMY is a special purpose acquisition company incorporated in Delaware on June 18, 2020. On August 18, 2020, dMY consummated its IPO. Upon the closing of its IPO, overallotment option and the private placements, $276.0 million of the net proceeds therefrom were placed in the dMY trust account. As of December 31, 2020, there was $276.1 million held in the dMY trust account. As a special purpose acquisition company, dMY’s purpose is to acquire, through a merger, capital stock exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination, one or more businesses or entities.
The unaudited pro forma condensed combined balance sheet as of December 31, 2020 combines the historical balance sheet of TopCo and the historical balance sheet of dMY on a pro forma basis as if the Business Combination and related transactions, summarized below, had been consummated on December 31, 2020. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020 combines the historical statement of operations of TopCo and dMY for such periods on a pro forma basis as if the Business Combination and related transactions, summarized below, had been consummated on January 1, 2020, the beginning of the earliest period presented.
The pro forma condensed combined financial information may not be useful in predicting the future financial condition and results of operations of the post-combination company. The actual financial position and results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors.
The historical financial information of TopCo was derived from the audited financial statements of TopCo as of and for the year ended December 31, 2020, which are included elsewhere in this Form 20-F. The historical financial information of dMY was derived from the audited financial statements of dMY for the period from June 18, 2020 (inception) to December 31, 2020, which were included with dMY’s 10-K/A filed with the SEC on April 27, 2021. This information should be read together with TopCo’s and dMY’s audited financial statements and related notes, as applicable, Item 5. Operating And Financial Review And Prospects and other financial information included elsewhere in this Form 20-F or in dMY’s 10-K/A.
Description of the Business Combination
On October 27, 2020, dMY, TopCo, Midco, NewCo, Merger Sub, and Sponsor entered into the Business Combination Agreement. Pursuant to the Business Combination Agreement, Topco undertook a series of transactions pursuant to which it sold, exchanged and contributed their shares for a mix of cash consideration and NewCo ordinary shares (the “Reorganization”). The Reorganization was immediately followed by the acquisition of dMY by Merger Sub with dMY being the surviving corporation and a wholly-owned subsidiary of NewCo. Additionally, NewCo and dMY entered into subscription agreements for the purchase an aggregate of 33,000,000 NewCo ordinary shares, for a purchase price of $10.00 per share, for an aggregate purchase price of $330.0 million (the “PIPE Investment”).
Accounting Treatment
The Business Combination was accounted for as a reverse recapitalization, with no goodwill or other intangible assets recorded, in accordance with accounting principles generally accepted in the United States of America. The Business Combination was first accounted for as a capital reorganization whereby NewCo was the successor to its predecessor TopCo. As a result of the first step described above, the existing shareholders of TopCo continued to retain control through ownership of NewCo.
The capital reorganization was immediately followed by the acquisition of dMY, which was accounted for within the scope of ASC 805. Under this method of accounting, dMY was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of NewCo issuing NewCo ordinary shares for the net assets of dMY, accompanied by a recapitalization. The NewCo ordinary shares issued were recognized at fair value and recorded as consideration for the acquisition of the public shell company, dMY. Under this method of accounting, there was no acquisition accounting and no recognition of goodwill or other intangible assets, as dMY is not recognized as a business as defined under ASC 805, given it consists predominantly of cash or other marketable securities in the dMY trust account.
TopCo was determined to be the accounting acquirer and predecessor in the Business Combination based on evaluation of the following facts and circumstances:
TopCo’s shareholders have the largest voting interest in NewCo;
NewCo’s board of directors consists of seven directors, and NewCo expects to add two additional directors to the board following the Closing: TopCo’s shareholders were initially entitled to appoint six directors, dMY was initially entitled to appoint two directors and the Chief Executive Officer of NewCo is a director of NewCo;
The business of TopCo is comprised of the ongoing operations of NewCo;
TopCo is the larger entity, in terms of both revenues and total assets.
Other factors were considered, including composition of management, purpose and intent of the Business Combination and the location of NewCo’s headquarters, noting that the preponderance of evidence as described above is indicative that TopCo was the accounting acquirer and predecessor in the Business Combination.
The following summarizes the number of NewCo ordinary shares outstanding following the Closing:
Shareholders | ||||||||
| Ownership in shares | % of ownership | |||||||
Maven TopCo Limited (sellers)(1) (3) | 100,060,948 | 59.7 | % | |||||
dMY Public Ownership (2) | 27,598,704 | 16.5 | % | |||||
dMY Technology Group, Inc. II founders | 6,900,000 | 4.1 | % | |||||
PIPE Investors | 33,000,000 | 19.7 | % | |||||
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| 167,559,652 | 100.0 | % | ||||||
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Pro Forma Condensed Combined Financial Information
Set forth below is the unaudited pro forma condensed combined balance sheet as of December 31, 2020 and the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020, based on the historical financial statements of TopCo and dMY (as adjusted below).
|
AS OF DECEMBER 31, 2020
(in thousands)
| As of December 31, 2020 | As of December 31, 2020 | |||||||||||||||||
| TopCo (Historical) | DMY (Historical) (As Restated) | Transaction Accounting Adjustments | Pro Forma Combined | |||||||||||||||
Assets | ||||||||||||||||||
Current assets: | ||||||||||||||||||
Cash and cash equivalents | $ | 11,781 | $ | 978 | $ | 276,099 | (A) | $ | 157,519 | |||||||||
| (20,130 | ) | (B) | ||||||||||||||||
| (16,503 | ) | (C) | ||||||||||||||||
| (9,660 | ) | (D) | ||||||||||||||||
| (92,881 | ) | (E) | ||||||||||||||||
| (292,579 | ) | (F) | ||||||||||||||||
| 316,800 | (G) | |||||||||||||||||
| 4,635 | (H) | |||||||||||||||||
| (576 | ) | (I) | ||||||||||||||||
| (20,432 | ) | (J) | ||||||||||||||||
| (13 | ) | (P) | ||||||||||||||||
Accounts receivable, net | 24,776 | — | — | 24,776 | ||||||||||||||
Contract assets | 10,088 | — | — | 10,088 | ||||||||||||||
Prepaid expenses | 4,107 | 373 | — | 4,480 | ||||||||||||||
Other current assets | 10,584 | — | (2,093 | ) | (B) | 8,491 | ||||||||||||
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Total current assets | 61,336 | 1,351 | 142,667 | 205,354 | ||||||||||||||
Property and equipment, net | 5,002 | — | — | 5,002 | ||||||||||||||
Intangible assets, net | 114,542 | — | — | 114,542 | ||||||||||||||
Goodwill | 200,624 | — | — | 200,624 | ||||||||||||||
Deferred tax asset | 5 | — | — | 5 | ||||||||||||||
Investments held in Trust Account | — | 276,099 | (276,099 | ) | (A) | — | ||||||||||||
Other asset | 9,496 | — | (4,635 | ) | (H) | 4,861 | ||||||||||||
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Total assets | $ | 391,005 | $ | 277,450 | $ | (138,067 | ) | $ | 530,388 | |||||||||
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Liabilities | ||||||||||||||||||
Current liabilities: | ||||||||||||||||||
Accounts payable | 10,106 | 186 | (186 | ) | (I) | 10,106 | ||||||||||||
Accrued expenses | 35,220 | 284 | (2,527 | ) | (B) | 32,693 | ||||||||||||
| (284 | ) | �� | (I) | |||||||||||||||
Deferred revenue | 26,036 | — | — | 26,036 | ||||||||||||||
Franchise tax payable | — | 106 | (106 | ) | (I) | — | ||||||||||||
Current debt | 10,272 | — | (10,248 | ) | (E) | 24 | ||||||||||||
Other current liabilities | 3,714 | — | (1,001 | ) | (K) | 2,713 | ||||||||||||
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Total current liabilities | 85,348 | 576 | (14,352 | ) | 71,572 | |||||||||||||
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Long-term debt - less current portion | 82,723 | — | (82,633 | ) | (E) | 90 | ||||||||||||
Deferred tax liability | 8,097 | — | — | 8,097 | ||||||||||||||
Other liabilities | 3,589 | — | — | 3,589 | ||||||||||||||
Deferred underwriting commissions | — | 9,660 | (9,660 | ) | (D) | — | ||||||||||||
Derivative warrant liabilities | — | 69,732 | — | | 69,732 | | ||||||||||||
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Total liabilities | 179,757 | 79,968 | (106,645 | ) | 153,080 | |||||||||||||
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Commitments | ||||||||||||||||||
Temporary equity: | ||||||||||||||||||
Preference Shares | 350,675 | — | (292,579 | ) | (F) | — | ||||||||||||
| (58,096 | ) | (M) | ||||||||||||||||
Class A common stock subject to possible redemption | — | 192,482 | (192,482 | ) | (L) | — | ||||||||||||
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Total temporary equity | 350,675 | 192,482 | (543,157 | ) | — | |||||||||||||
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Stockholders’ equity: | ||||||||||||||||||
Class A common stock | — | 1 | 330 | (G) | 1,677 | |||||||||||||
| 213 | (K) | |||||||||||||||||
| 192 | (L) | |||||||||||||||||
| 788 | (M) | |||||||||||||||||
| 153 | (N) | |||||||||||||||||
Class B common stock | 1 | (1 | ) | (N) | — | |||||||||||||
Common shares | 24 | — | (24 | ) | (M) | — | ||||||||||||
Additional paid-in capital | 2,393 | 59,531 | (19,696 | ) | (B) | 749,844 | ||||||||||||
| (16,503 | ) | (C) | ||||||||||||||||
| 316,470 | (G) | |||||||||||||||||
| 212,725 | (K) | |||||||||||||||||
| 192,290 | (L) | |||||||||||||||||
| 57,332 | (M) | |||||||||||||||||
| (152 | ) | (N) | ||||||||||||||||
| (54,533 | ) | (O) | ||||||||||||||||
| (13 | ) | (P) | ||||||||||||||||
Accumulated deficit | (153,237 | ) | (54,533 | ) | (20,432 | ) | (J) | (385,606 | ) | |||||||||
| (211,937 | ) | (K) | ||||||||||||||||
| 54,533 | (O) | |||||||||||||||||
Accumlated other comprehensive income | 11,393 | — | — | 11,393 | ||||||||||||||
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Total stockholders’ equity | (139,427 | ) | 5,000 | 511,735 | 377,308 | |||||||||||||
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Total liabilities, temporary equity and stockholders’ equity | $ | 391,005 | $ | 277,450 | $ | (138,067 | ) | $ | 530,388 | |||||||||
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FOR YEAR ENDED DECEMBER 31, 2020
(in thousands, except share and per share data)
| For the Year Ended December 31, 2020 | For the Period from June 18, 2020 through December 31, 2020 | For the Year Ended December 31, 2020 | ||||||||||||||||
| TopCo (Historical) | DMY (Historical) (As Restated) | Transaction Accounting Adjustments | Pro Forma Combined | |||||||||||||||
Revenue | ||||||||||||||||||
Revenue | 149,739 | — | — | 149,739 | ||||||||||||||
Cost of revenue | 114,066 | — | 707 | (AA) | 116,485 | |||||||||||||
| 1,712 | (FF) | |||||||||||||||||
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Gross profit | 35,673 | — | (2,419 | ) | 33,254 | |||||||||||||
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Operating expenses | ||||||||||||||||||
Sales and marketing | 13,176 | — | 3,067 | (AA) | 23,669 | |||||||||||||
| 7,426 | (FF) | |||||||||||||||||
Research and development | 11,240 | — | 3,277 | (AA) | 22,454 | |||||||||||||
| 7,937 | (FF) | |||||||||||||||||
General and administrative | 31,623 | 621 | 80,465 | (AA) | 328,002 | |||||||||||||
| 194,861 | (FF) | |||||||||||||||||
| 20,432 | (GG) | |||||||||||||||||
Transaction expenses | 672 | — | — | 672 | ||||||||||||||
| — | ||||||||||||||||||
Franchise tax expense | — | 106 | — | 106 | ||||||||||||||
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Total operating expenses | 56,711 | 727 | 317,465 | 374,903 | ||||||||||||||
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Loss from operations | (21,038 | ) | (727 | ) | (319,884 | ) | (341,649 | ) | ||||||||||
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Interest income (expense), net | (7,874 | ) | — | 7,120 | (BB) | (861 | ) | |||||||||||
| (107 | ) | (CC) | ||||||||||||||||
Loss on disposal of assets | (8 | ) | — | — | (8 | ) | ||||||||||||
Gain on fair value remeasurement of contingent consideration | 271 | — | — | 271 | ||||||||||||||
Gain (loss) on foreign currency | 114 | — | — | 114 | ||||||||||||||
Gain on marketable securities (net), dividends and interest, held in Trust Account | — | 99 | (99 | ) | (DD) | — | ||||||||||||
Change in fair value of derivative warrant liabilities | — | (53,905 | ) | — | (53,905 | ) | ||||||||||||
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Loss before income taxes | (28,535 | ) | (54,533 | ) | (312,970 | ) | (396,038 | ) | ||||||||||
Income tax benefit (expense) | (1,813 | ) | — | 59,464 | (EE) | 57,651 | ||||||||||||
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Net loss | (30,348 | ) | (54,533 | ) | (253,506 | ) | (338,387 | ) | ||||||||||
Net loss per share, basic and diluted | $ | (16.20 | ) | — | $ | (2.02 | ) | |||||||||||
Weighted average shares outstanding, basic and diluted | 1,873,423 | — | 167,559,652 | |||||||||||||||
Weighted average shares outstanding of Class A Shares | 27,600,000 | |||||||||||||||||
Basic and diluted net income per share, Class A | — | |||||||||||||||||
Weighted average shares outstanding of Class B common stock | 6,900,000 | |||||||||||||||||
Basic and diluted net loss per share, Class B | $ | (7.90 | ) | |||||||||||||||
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The Business Combination was accounted for as a reverse recapitalization, with no goodwill or other intangible assets recorded, in accordance with accounting principles generally accepted in the United States of America. The Business Combination was first accounted for as a capital reorganization whereby NewCo was the successor to its predecessor TopCo. As a result of the first step described above, the existing shareholders of TopCo continued to retain control through ownership of NewCo.
The capital reorganization was immediately followed by the acquisition of dMY, which was accounted for within the scope of ASC 805. Under this method of accounting, dMY was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of NewCo issuing NewCo ordinary shares for the net assets of dMY, accompanied by a recapitalization. The NewCo ordinary shares issued were recognized at fair value and recorded as consideration for the acquisition of the public shell company, dMY. Under this method of accounting, there was no acquisition accounting and no recognition of goodwill or other intangible assets, as dMY is not recognized as a business as defined under ASC 805, given it consists predominantly of cash or other marketable securities in the dMY trust account.
TopCo was been determined to be the accounting acquirer and predecessor in the Business Combination based on evaluation of the following facts and circumstances:
TopCo’s shareholders have the largest voting interest in NewCo;
NewCo’s board of directors consists of seven directors, and NewCo expects to add two additional directors to the board following the Closing: TopCo’s shareholders were initially entitled to appoint six directors, dMY was initially entitled to appoint two directors and the Chief Executive Officer of NewCo is a director of NewCo;
The business of TopCo is comprised of the ongoing operations of NewCo;
TopCo is the larger entity, in terms of both revenues and total assets.
Other factors were considered, including composition of management, purpose and intent of the Business Combination and the location of NewCo’s headquarters, noting that the preponderance of evidence as described above is indicative that TopCo is the accounting acquirer and predecessor in the Business Combination.
The unaudited pro forma condensed combined balance sheet as of December 31, 2020 assumes that the Business Combination occurred on December 31, 2020. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020 presents pro forma effect to the Business Combination as if it had been completed on January 1, 2020. These periods are presented on the basis that TopCo is the accounting acquirer.
The unaudited pro forma condensed combined balance sheet as of December 31, 2020 has been prepared using, and should be read in conjunction with, the following:
TopCo’s audited condensed balance sheet as of December 31, 2020 and the related notes for the period ended December 31, 2020, included elsewhere in this Form 20-F; and
dMY’s audited combined balance sheet as of December 31, 2020 and the related notes for the period ended December 31, 2020, included in dMY’s 10-K/A filed with the SEC on April 27, 2021.
The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020 has been prepared using, and should be read in conjunction with, the following:
TopCo’s audited combined statement of operations for the year ended December 31, 2020 and the related notes, included elsewhere in this Form 20-F; and
dMY’s audited condensed statement of operations for the period from June 18, 2020 (inception) to December 31, 2020 and the related notes, included in dMY’s 10-K/A filed with the SEC on April 27, 2021.
Management has made significant estimates and assumptions in its determination of the pro forma adjustments. As the unaudited pro forma condensed combined financial information has been prepared based on these preliminary estimates, the final amounts recorded may differ materially from the information presented.
The pro forma adjustments reflecting the consummation of the Business Combination are based on certain currently available information and certain assumptions and methodologies that NewCo believes are reasonable under the circumstances. The unaudited condensed pro forma adjustments, which are described in the accompanying notes, may be revised as additional information becomes available and is evaluated. Therefore, it is likely that the actual adjustments will differ from the pro forma adjustments and it is possible the difference may be material. NewCo believes that its assumptions and methodologies provide a reasonable basis for presenting all of the significant effects of the Business Combination based on information available to management at this time and that the pro forma adjustments give appropriate effect to those assumptions and are properly applied in the unaudited pro forma condensed combined financial information.
The unaudited pro forma condensed combined financial information is not necessarily indicative of what the actual results of operations and financial position would have been had the Business Combination taken place on the dates indicated, nor are they indicative of the future consolidated results of operations or financial position of the post-combination company. They should be read in conjunction with the historical financial statements and notes thereto of TopCo and dMY.
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Upon consummation of the Business Combination, management will perform a comprehensive review of the two entities’ accounting policies. As a result of the review, management may identify differences between the accounting policies of the two entities which, when conformed, could have a material impact on the financial statements of NewCo. Based on its initial analysis, management did not identify any differences that would have a material impact on the unaudited pro forma condensed combined financial information. As a result, the unaudited pro forma condensed combined financial information does not assume any differences in accounting policies.
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The unaudited pro forma condensed combined financial information has been prepared to illustrate the effect of the Business Combination and has been prepared for informational purposes only.
The following unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release No. 33-10786 “Amendments to Financial Disclosures about Acquired and Disposed Businesses”. Release No. 33-10786 replaces the existing pro forma adjustment criteria with simplified requirements to depict the accounting for the transaction (“Transaction Accounting Adjustments”) and present the reasonably estimable synergies and other transaction effects that have occurred or reasonably expected to occur (“Management’s Adjustments”). NewCo has elected not to present Management’s Adjustments and will only be presenting Transaction Accounting Adjustments in the following unaudited pro forma condensed combined financial information.
The pro forma combined provision for income taxes does not necessarily reflect the amounts that would have resulted had the post-combination company filed consolidated income tax returns during the periods presented.
The pro forma basic and diluted earnings per share amounts presented in the unaudited pro forma condensed combined statement of operations are based upon the number of NewCo’s shares outstanding, assuming the Business Combination occurred on January 1, 2020.
Transaction Accounting Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet
The Transaction Accounting Adjustments included in the unaudited pro forma condensed combined balance sheet as of December 31, 2020 are as follows:
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Transaction Accounting Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations
The transaction accounting adjustments included in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020 are as follows:
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Represents the net loss per share calculated using the historical weighted average shares outstanding, and the issuance of additional shares in connection with the Business Combination, assuming the shares were outstanding since January 1, 2020. As the Business Combination and transactions are being reflected as if they had occurred at the beginning of the periods presented, the calculation of weighted average shares outstanding for basic and diluted net income (loss) per share assumes that the shares issuable relating to the Business Combination have been outstanding for the entire periods presented.
| Period Ended December 31, 2020 | ||||
| (In thousands, except per share data) | ||||
Pro forma net income (loss) | $ | (338,387 | ) | |
Weighted average shares outstanding - basic and diluted (1) (2) | 167,559,652 | |||
Net income (loss) per share - basic and diluted | $ | (2.02 | ) | |
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Legal and Arbitration Proceedings, Investigations and Tax Audits
In the future, we may be subject to additional legal proceedings, the scope and severity of which is unknown and which could adversely affect our business. See Item 3.D “
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on-going and Genius can provide no assurances regarding the outcome of these proceedings and the impact that they may have on Genius’s business or reputation.
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ITEM 9. | THE OFFER AND LISTING |
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Not applicable.
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Genius Sharesordinary shares and Warrants are listed on the NYSE under the symbols “GENI” and “GENI WS,” respectively.
ITEM 10. |
ADDITIONAL INFORMATION |
Not applicable.
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Not applicable.
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Not applicable.
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B. Memorandum and |
Our Memorandum of Incorporation provides that the objects and powers of Genius Sports Limited are not restricted and our Articles of Incorporation (or the “Articles”), provide that our business is
The Articles grant the Board of Directors all the powers necessary for managing, directing and supervising the management of the business and affairs of Genius Sports Limited.
The Board of Directors of Genius Sports Limited is authorised to issue an unlimited number of shares of any class. The Board may create and issue additional classes of shares, including series of preferred shares, which could be utilizedthis Report for a varietysummary of corporate purposes, including future offerings to raise capital for corporate purposes or for use in employee benefit plans. Such additional classesspecified provisions of shares will have such voting powers (full or limited or without voting powers), designations, preferences and relative, participating, optional or other special rights and qualifications, limitations or restrictions thereof as may be determined by the Board.
The holders of ordinary shares are entitled to such dividends as may be declared by the Board, subject to the Guernsey Companies Law. Dividends and other distributions authorised by the Board in respect of the issued and outstanding ordinary shares shall be distributed among the holders of ordinary shares on a pro rata basis. The B shares in the capital of Genius Sports Limited do not entitle holders to dividends or distributions.
Ordinary shares entitle the holder (i) on a show of hands, to one vote and (ii) on a poll, to one vote for each ordinary share registered in the name of the holder on all matters upon which the ordinary shares are entitled to vote (whether in person or by proxy). Voting at any shareholders’ meeting is by way of poll, unless otherwise determined by the Board or the shareholders of Genius Sports Limited in accordance with the Guernsey Companies Law. The B shares entitle the holder (i) on a show of hands, to one tenth of a vote and (ii) on a poll, to one tenth of a vote for B share registered in the name of the holder on all matters upon which the B shares are entitled to vote (whether in person or by proxy).
Where ordinary shares have been admitted to settlement by means of the uncertificated system operated by DTC (or any other uncertificated system to which Genius Sports Limited’s shares are admitted to settlement) (an “uncertificated system”), any shareholder may transfer all or any of his or her ordinary shares in accordance with and subject to the rules issued by DTC (or such other operator as may operate the relevant uncertificated system) (the “Rules”) and no written instrument of transfer shall, subject to the Rules, be required.
Where any ordinary shares or B shares are not admitted to an uncertificated system, a shareholder may transfer his or her ordinary shares by an instrument of transfer in the usual form or any other form approved by the Board.
In addition, the Genius Governing Documents provide (without limitation) that the Board may, subject to the Rules, decline to recognize any transferDocuments.
The directors are divided into three classes designated as Class I, Class II and Class III, respectively. Directors shall initially be assigned to each class in accordance with the Amended and Restated Investor Rights Agreement. At the first annual general meeting of shareholders of Genius Sports Limited, the term of office of the Class I directors shall expire and Class I directors shall be elected for a full term of three years, ending at our 2024 annual general meeting. At the second annual general meeting (expected in 2022), the term of office of the Class II directors will expire and Class II directors will be elected for a full term of three years. At the third annual general meeting (expected in 2023), the term of office of the Class III directors will expire and Class III directors will be elected for a full term of three years. At each succeeding annual general meeting, directors will be elected for a full term of three years to succeed the directors of the class whose terms expire at such annual general meeting. No decrease in the number of directors constituting the directors shall shorten the term of any incumbent director.
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sanction.uponon which the Closing occurred but prior to the Closing, TopCo (1) underwent the Reorganization wherein the Pre-Closing Holders (as defined in the Business Combination Agreement) exchanged all existing classes of shares of TopCo (except for (i) certain preference shares of TopCo which were redeemed in the TopCo Redemption (such preference shares, the “Remaining Preference Shares”) and (ii) certain shares of TopCo which were contributed to Genius in exchange for an amount equal to the Catch-Up Payment) for newly issued ordinary shares of Genius. As described in the Business Combination Agreement, solely with respect to the shares of TopCo that are unvested immediately prior to the Reorganization and with respect to which the holders of such shares have executed support agreements agreeing to the vesting and restriction provisions therein, such shares were exchanged for the ordinary shares of Genius but remained subject to the vesting and restrictions as summarized in such support agreements (such shares subject to such vesting and restrictions, the “Restricted Shares”); and (2) the Remaining Preference Shares were redeemed and cancelled pursuant to the TopCo Redemption.Director AgreementsWe have also entered into director agreements with certain of our directors which agreements set forth the terms and provisions of their engagement. We have also issued ordinary shares to David Levy, an independent director, after the consummation of this offering in accordance with the terms of his director agreement, the form of which is filed as Exhibit 4.11 to this Report.See Item 7.B for descriptions of Material Contracts.D.Exchange Controlssanction.E.Taxation
Genius as part of the PIPE Investment or the Reorganization; and
case, with respect to any dividend paid for any taxable year, the U.S.-source ratio of such dividends for foreign tax credit purposes would be equal to the portion of Genius’ earnings and profits from sources within the U.S. for such taxable year, divided by the total amount of Genius’ earnings and profits for such taxable year.
Holder that fails to comply with this reporting requirement and the period of limitations on assessment and collection of U.S. federal income taxes will be extended in the event of a failure to comply. In addition, certain U.S. Holders (and to the extent provided in IRS guidance, certain individual Non-U.S. Holders) holding specified foreign financial assets with an aggregate value in excess of the applicable dollar thresholds are required to report information to the IRS relating to Genius ordinary shares, subject to certain exceptions (including an exception for Genius ordinary shares held in accounts maintained by U.S. financial institutions), by attaching a complete IRS Form 8938 (Statement of Specified Foreign Financial Assets) with their tax return for each year in which they hold Genius ordinary shares. Substantial penalties apply to any failure to file IRS Form 8938 and the period of limitations on assessment and collection of U.S. federal income taxes will be extended in the event of a failure to comply. U.S. Holders are urged to consult their tax advisors regarding the effect, if any, of these rules on the ownership and disposition of Genius ordinary shares.
(i) the gain is effectively connected with the conduct of a trade or business of the Non-U.S. Holder in the United States, and, if provided in an applicable income tax treaty, is attributable to a “permanent establishment” or a “fixed base” maintained by the Non-U.S. Holder in the United States; or
(ii) the Non-U.S. Holder is an individual who is treated as present in the U.S. for 183 days or more during the taxable year of disposition and certain other conditions are met, in which case such gain (which gain may be offset by certain U.S.-source losses) generally will be taxed at a 30% rate (or lower applicable treaty rate).
| i) | the gain is effectively connected with the conduct of a trade or business of the Non-U.S. Holder in the United States, and, if provided in an applicable income tax treaty, is attributable to a “permanent establishment” or a “fixed base” maintained by the Non-U.S. Holder in the United States; or |
| ii) | the Non-U.S. Holder is an individual who is treated as present in the U.S. for 183 days or more during the taxable year of disposition and certain other conditions are met, in which case such gain (which gain may be offset by certain U.S.-source losses) generally will be taxed at a 30% rate (or lower applicable treaty rate). |
2021-2022.
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ITEM 11. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 12. | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES |
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B. |
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Genius Warrants
Public Shareholders’ Warrants
Each whole Genius warrant entitles the registered holder to purchase one Genius ordinary share at a price of $11.50 per share, subject to adjustment as discussed below, at any time commencing upon 12 months from the closing of the IPO (i.e., August 18, 2021), provided that Genius has an effective registration statement under the Securities Act covering the Genius ordinary shares issuable upon exercise of the warrants and a current prospectus relating to them is available (or Genius permits holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement) and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of Genius ordinary shares. This means only a whole warrant may be exercised at a given time by a warrant holder. The warrants will expire five years after the completion of the Business Combination, at 5:00 PM, Eastern Time, or earlier upon redemption or liquidation.
Genius will not be obligated to deliver any Genius ordinary shares pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act with respect to the ordinary shares underlying the warrants is then effective and a prospectus relating thereto is current, subject to our satisfying our obligations described below with respect to registration. No warrant will be exercisable and Genius will not be obligated to issue a Genius ordinary share upon exercise of a warrant unless the Genius ordinary share issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants. In the event that the conditions in the two immediately preceding sentences are not satisfied with respect to a warrant, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In no event will Genius be required to net cash settle any warrant. In the event that a registration statement is not effective for the exercised warrants, the purchaser of a dMY unit containing such warrant will have paid the full purchase price for the unit solely for the Genius ordinary share underlying such unit.
Genius has agreed that as soon as practicable, but in no event later than fifteen (15) business days after the Closing, it will use its best efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the Genius ordinary shares issuable upon exercise of the warrants. Genius will use its best efforts to cause the same to become effective and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the warrants in accordance with the provisions of the warrant agreement. If a registration statement covering the Genius ordinary shares issuable upon exercise of the warrants is not effective by the sixtieth (60th) business day after Closing, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if Genius ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, Genius may, at its option, require holders of public warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event Genius so elects, it will not be required to file or maintain in effect a registration statement, and in the event Genius does not so elect, Genius will use its best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. In such event, each holder would pay the exercise price by surrendering the warrants for that number of Genius ordinary shares equal to the lesser of (A) the quotient obtained by dividing (x) the product of the number of Genius ordinary shares underlying the warrants, multiplied by the excess of the “fair market value” (defined below) less the exercise price of the warrants by (y) the fair market value and (B) 0.361. The “fair market value” as used in this paragraph shall mean the volume weighted average price of the Genius ordinary shares for the 10 trading days ending on the trading day prior to the date on which the notice of exercise is received by the warrant agent.
Redemption of warrants when the price per Genius ordinary share equals or exceeds $18.00.
Once the warrants become exercisable, Genius may redeem the outstanding warrants:
in whole and not in part;
at a price of $0.01 per warrant;
upon a minimum of 30 days’ prior written notice of redemption to each warrant holder; and
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Genius will not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the Genius ordinary shares issuable upon exercise of the warrants is then effective and a current prospectus relating to those Genius ordinary shares is available throughout the 30-day redemption period. If and when the warrants become redeemable by Genius, Genius may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws.
Genius has established the last of the redemption criterion discussed above to prevent a redemption call unless there is at the time of the call a significant premium to the warrant exercise price. If the foregoing conditions are satisfied and we issue a notice of redemption of the warrants, each warrant holder will be entitled to exercise his, her or its warrant prior to the scheduled redemption date. However, the price of the Genius ordinary shares may fall below the $18.00 redemption trigger price (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “—Warrants—Public Shareholders’ Warrants—Anti-Dilution Adjustments”) as well as the $11.50 (for whole shares) warrant exercise price after the redemption notice is issued.
Redemption of warrants when the price per Genius ordinary share equals or exceeds $10.00.
Once the warrants become exercisable, Genius may redeem the outstanding warrants:
in whole and not in part;
at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table below, based on the redemption date and the “fair market value” (as defined below) of the Genius ordinary shares except as otherwise described below; and
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Beginning on the date the notice of redemption is given until the warrants are redeemed or exercised, holders may elect to exercise their warrants on a cashless basis. The numbers in the table below represent the number of Genius ordinary shares that a warrant holder will receive upon such cashless exercise in connection with a redemption by us pursuant to this redemption feature, based on the “fair market value” of the Genius ordinary shares on the corresponding redemption date (assuming holders elect to exercise their warrants and such warrants are not redeemed for $0.10 per warrant), determined for these purposes based on volume weighted average price of the Genius ordinary shares during the 10 trading days immediately following the date on which the notice of redemption
is sent to the holders of warrants, and the number of months that the corresponding redemption date precedes the expiration date of the warrants, each as set forth in the table below. We will provide our warrant holders with the final fair market value no later than one business day after the 10-trading day period described above ends.
The share prices set forth in the column headings of the table below will be adjusted as of any date on which the number of shares issuable upon exercise of a warrant or the exercise price of a warrant is adjusted as set forth under the heading “—Anti-Dilution Adjustments” below. If the number of shares issuable upon exercise of a warrant is adjusted, the adjusted share prices in the column headings will equal the share prices immediately prior to such adjustment, multiplied by a fraction, the numerator of which is the number of shares deliverable upon exercise of a warrant immediately prior to such adjustment and the denominator of which is the number of shares deliverable upon exercise of a warrant as so adjusted. The number of shares in the table below shall be adjusted in the same manner and at the same time as the number of shares issuable upon exercise of a warrant. If the exercise price of a warrant is adjusted, (a) in the case of an adjustment pursuant to the fifth paragraph under the heading “—Anti-Dilution Adjustments” below, the adjusted share prices in the column headings will equal the unadjusted share price multiplied by a fraction, the numerator of which is the higher of the Market Value and the Newly Issued Price as set forth under the heading “—Anti-Dilution Adjustments” and the denominator of which is $10.00 and (b) in the case of an adjustment pursuant to the second paragraph under the heading “—Anti-Dilution Adjustments” below, the adjusted share prices in the column headings will equal the unadjusted share price less the decrease in the exercise price of a warrant pursuant to such exercise price adjustment.
| Fair Market Value of Ordinary Shares | ||||||||||||||||||||||||||||||||||||
Redemption Date (period to expiration of warrants) | £ 10.00 | 11.00 | 12.00 | 13.00 | 14.00 | 15.00 | 16.00 | 17.00 | ³ 18.00 | |||||||||||||||||||||||||||
60 months | 0.261 | 0.281 | 0.297 | 0.311 | 0.324 | 0.337 | 0.348 | 0.358 | 0.361 | |||||||||||||||||||||||||||
57 months | 0.257 | 0.277 | 0.294 | 0.310 | 0.324 | 0.337 | 0.348 | 0.358 | 0.361 | |||||||||||||||||||||||||||
54 months | 0.252 | 0.272 | 0.291 | 0.307 | 0.322 | 0.335 | 0.347 | 0.357 | 0.361 | |||||||||||||||||||||||||||
51 months | 0.246 | 0.268 | 0.287 | 0.304 | 0.320 | 0.333 | 0.346 | 0.357 | 0.361 | |||||||||||||||||||||||||||
48 months | 0.241 | 0.263 | 0.283 | 0.301 | 0.317 | 0.332 | 0.344 | 0.356 | 0.361 | |||||||||||||||||||||||||||
45 months | 0.235 | 0.258 | 0.279 | 0.298 | 0.315 | 0.330 | 0.343 | 0.356 | 0.361 | |||||||||||||||||||||||||||
42 months | 0.228 | 0.252 | 0.274 | 0.294 | 0.312 | 0.328 | 0.342 | 0.355 | 0.361 | |||||||||||||||||||||||||||
39 months | 0.221 | 0.246 | 0.269 | 0.290 | 0.309 | 0.325 | 0.340 | 0.354 | 0.361 | |||||||||||||||||||||||||||
36 months | 0.213 | 0.239 | 0.263 | 0.285 | 0.305 | 0.323 | 0.339 | 0.353 | 0.361 | |||||||||||||||||||||||||||
33 months | 0.205 | 0.232 | 0.257 | 0.280 | 0.301 | 0.320 | 0.337 | 0.352 | 0.361 | |||||||||||||||||||||||||||
30 months | 0.196 | 0.224 | 0.250 | 0.274 | 0.297 | 0.316 | 0.335 | 0.351 | 0.361 | |||||||||||||||||||||||||||
27 months | 0.185 | 0.214 | 0.242 | 0.268 | 0.291 | 0.313 | 0.332 | 0.350 | 0.361 | |||||||||||||||||||||||||||
24 months | 0.173 | 0.204 | 0.233 | 0.260 | 0.285 | 0.308 | 0.329 | 0.348 | 0.361 | |||||||||||||||||||||||||||
21 months | 0.161 | 0.193 | 0.223 | 0.252 | 0.279 | 0.304 | 0.326 | 0.347 | 0.361 | |||||||||||||||||||||||||||
18 months | 0.146 | 0.179 | 0.211 | 0.242 | 0.271 | 0.298 | 0.322 | 0.345 | 0.361 | |||||||||||||||||||||||||||
15 months | 0.130 | 0.164 | 0.197 | 0.230 | 0.262 | 0.291 | 0.317 | 0.342 | 0.361 | |||||||||||||||||||||||||||
12 months | 0.111 | 0.146 | 0.181 | 0.216 | 0.250 | 0.282 | 0.312 | 0.339 | 0.361 | |||||||||||||||||||||||||||
9 months | 0.090 | 0.125 | 0.162 | 0.199 | 0.237 | 0.272 | 0.305 | 0.336 | 0.361 | |||||||||||||||||||||||||||
6 months | 0.065 | 0.099 | 0.137 | 0.178 | 0.219 | 0.259 | 0.296 | 0.331 | 0.361 | |||||||||||||||||||||||||||
3 months | 0.034 | 0.065 | 0.104 | 0.150 | 0.197 | 0.243 | 0.286 | 0.326 | 0.361 | |||||||||||||||||||||||||||
0 months | — | — | 0.042 | 0.115 | 0.179 | 0.233 | 0.281 | 0.323 | 0.361 | |||||||||||||||||||||||||||
The exact fair market value and redemption date may not be set forth in the table above, in which case, if the fair market value is between two values in the table or the redemption date is between two redemption dates in the table, the number of Genius ordinary shares to be issued for each warrant exercised will be determined by a straight-line interpolation between the number of shares set forth for the higher and lower fair market values and the earlier and later redemption dates, as applicable, based on a 365 or 366-day year, as applicable. For example, if the volume weighted average price of the Genius ordinary shares during the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of the warrants is $11.00 per share, and at such time there are 57 months until the expiration of the warrants, holders may choose to, in connection with this redemption feature, exercise their warrants for 0.277 Genius ordinary shares for each whole warrant. For an example where the exact fair market value and redemption date are not as set forth in the table above, if the volume weighted average price of
the Genius ordinary shares during the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of the warrants is $13.50 per share, and at such time there are 38 months until the expiration of the warrants, holders may choose to, in connection with this redemption feature, exercise their warrants for 0.298 Genius ordinary shares for each whole warrant. In no event will the warrants be exercisable on a cashless basis in connection with this redemption feature for more than 0.361 Genius ordinary shares per warrant (subject to adjustment). Finally, as reflected in the table above, if the warrants are out of the money and about to expire, they cannot be exercised on a cashless basis in connection with a redemption by us pursuant to this redemption feature, since they will not be exercisable for any Genius ordinary shares.
This redemption feature is structured to allow for all of the outstanding warrants to be redeemed when the Genius ordinary shares are trading at or above $10.00 per share, which may be at a time when the trading price of the Genius ordinary shares is below the exercise price of the warrants. Genius has established this redemption feature to provide it with the flexibility to redeem the warrants without the warrants having to reach the $18.00 per share threshold set forth above under “—Redemption of warrants when the price per Genius ordinary share equals or exceeds $18.00.” Holders choosing to exercise their warrants in connection with a redemption pursuant to this feature will, in effect, receive a number of shares for their warrants based on an option pricing model with a fixed volatility input as of the date that dMY filed its final prospectus in connection with its initial public offering. This redemption right provides Genius with an additional mechanism by which to redeem all of the outstanding warrants, and therefore have certainty as to its capital structure as the warrants would no longer be outstanding and would have been exercised or redeemed and Genius will be required to pay the redemption price to warrant holders if it chooses to exercise this redemption right and it will allow Genius to quickly proceed with a redemption of the warrants if it determines it is in its best interest to do so. As such, Genius would redeem the warrants in this manner when it believes it is in its best interest to update its capital structure to remove the warrants and pay the redemption price to the warrant holders.
As stated above, Genius can redeem the warrants when the Genius ordinary shares are trading at a price starting at $10.00, which is below the exercise price of $11.50, because it will provide certainty with respect to our capital structure and cash position while providing warrant holders with the opportunity to exercise their warrants on a cashless basis for the applicable number of shares. If Genius chooses to redeem the warrants when the Genius ordinary shares are trading at a price below the exercise price of the warrants, this could result in the warrant holders receiving fewer Genius ordinary shares than they would have received if they had chosen to wait to exercise their warrants for Genius ordinary shares if and when such Genius ordinary shares were trading at a price higher than the exercise price of $11.50.
No fractional Genius ordinary shares will be issued upon exercise. If, upon exercise, a holder would be entitled to receive a fractional interest in a share, Genius will round down to the nearest whole number of the number of Genius ordinary shares to be issued to the holder.
Redemption procedures
A holder of a warrant may notify Genius in writing in the event it elects to be subject to a requirement that such holder will not have the right to exercise such warrant, to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the warrant agent’s actual knowledge, would beneficially own in excess of 4.9% or 9.8% (as specified by the holder) of the Genius ordinary shares outstanding immediately after giving effect to such exercise.
Anti-Dilution Adjustments
If the number of outstanding Genius ordinary shares is increased by a capitalization or share dividend payable in Genius ordinary shares, or by a split-up of Genius ordinary shares or other similar event, then, on the effective date of such capitalization or share dividend, split-up or similar event, the number of Genius ordinary shares issuable on exercise of each warrant will be increased in proportion to such increase in the outstanding Genius ordinary shares. A rights offering made to all or substantially all holders of Genius ordinary shares entitling holders to purchase Genius ordinary shares at a price less than the “historical fair market value” (as defined below) will be deemed a share dividend of a number of Genius ordinary shares equal to the product of (i) the number of Genius ordinary shares actually sold in such rights offering (or issuable under any other equity securities sold in such rights
offering that are convertible into or exercisable for Genius ordinary shares) and (ii) one minus the quotient of (x) the price per Genius ordinary share paid in such rights offering and (y) the historical fair market value. For these purposes, (i) if the rights offering is for securities convertible into or exercisable for Genius ordinary shares, in determining the price payable for Genius ordinary shares, there will be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) “historical fair market value” means the volume weighted average price of Genius ordinary shares as reported during the 10 trading day period ending on the trading day prior to the first date on which the Genius ordinary shares trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.
In addition, if Genius, at any time while the warrants are outstanding and unexpired, pays a dividend or makes a distribution in cash, securities or other assets to all of the holders of the Genius ordinary shares on account of such Genius ordinary shares (or other securities into which the warrants are convertible), other than (a) as described above or (b) any cash dividends or cash distributions which, when combined on a per share basis with all other cash dividends and cash distributions paid on the Genius ordinary shares during the 365-day period ending on the date of declaration of such dividend or distribution does not exceed $0.50 (as adjusted to appropriately reflect any other adjustments and excluding cash dividends or cash distributions that resulted in an adjustment to the exercise price or to the number of Genius ordinary shares issuable on exercise of each warrant) but only with respect to the amount of the aggregate cash dividends or cash distributions equal to or less than $0.50 per share, then the warrant exercise price will be decreased, effective immediately after the effective date of such event, by the amount of cash and/or the fair market value of any securities or other assets paid on each Genius ordinary share in respect of such event.
If the number of outstanding Genius ordinary shares is decreased by a consolidation, combination, reverse share split or reclassification of Genius ordinary shares or other similar event, then, on the effective date of such consolidation, combination, reverse share split, reclassification or similar event, the number of Genius ordinary shares issuable on exercise of each warrant will be decreased in proportion to such decrease in outstanding Genius ordinary shares.
Whenever the number of Genius ordinary shares purchasable upon the exercise of the warrants is adjusted, as described above, the warrant exercise price will be adjusted by multiplying the warrant exercise price immediately prior to such adjustment by a fraction (x) the numerator of which will be the number of Genius ordinary shares purchasable upon the exercise of the warrants immediately prior to such adjustment and (y) the denominator of which will be the number of Genius ordinary shares so purchasable immediately thereafter.
In case of any reclassification or reorganization of the outstanding Genius ordinary shares (other than those described above or that solely affects the par value of such Genius ordinary shares), or in the case of any merger or consolidation of us with or into another entity (other than a consolidation or merger in which Genius is the continuing entity and that does not result in any reclassification or reorganization of the outstanding Genius ordinary shares), or in the case of any sale or conveyance to another entity of the assets or other property of Genius as an entirety or substantially as an entirety in connection with which Genius is dissolved, the holders of the warrants will thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the warrants and in lieu of the Genius ordinary shares immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of Genius ordinary shares or other securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the warrants would have received if such holder had exercised their warrants immediately prior to such event. If less than 70% of the consideration receivable by the holders of Genius ordinary shares in such a transaction is payable in the form of Genius ordinary shares in the successor entity that is listed for trading on a national securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately following such event, and if the registered holder of the warrant properly exercises the warrant within thirty days following public disclosure of such transaction, the warrant exercise price will be reduced as specified in the warrant agreement based on the Black-Scholes Warrant Value (as defined in the warrant agreement) of the warrant. The purpose of such exercise price reduction is to provide additional value to holders of the warrants when an extraordinary transaction occurs during the exercise period of the warrants pursuant to which the holders of the warrants otherwise do not receive the full potential value of the warrants.
The warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price (or on a cashless basis, if applicable), by certified or official bank check payable to us, for the number of warrants being exercised. The warrant holders do not have the rights or privileges of holders of Genius ordinary shares and any voting rights until they exercise their warrants and receive Genius ordinary shares. After the issuance of Genius ordinary shares upon exercise of the warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by shareholders.
No fractional shares will be issued upon exercise of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, Genius will, upon exercise, round down to the nearest whole number the number of Genius ordinary shares to be issued to the warrant holder.
Private Placement Warrants
Except as described below, the private placement warrants have terms and provisions that are identical to those of the public warrants. The private placement warrants (including the Genius ordinary shares issuable upon exercise of the private placement warrants) will not be transferable, assignable or saleable until 30 days after the Closing (except pursuant to limited exceptions as described elsewhere in this Report with respect to dMY’s officers and directors and other persons or entities affiliated with the initial purchasers of the private placement warrants) and they will not be redeemable by Genius so long as they are held by the Sponsor or its permitted transferees (except as otherwise set forth herein). The Sponsor, or its permitted transferees, has the option to exercise the private placement warrants on a cashless basis. If the private placement warrants are held by holders other than the Sponsor or its permitted transferees, the private placement warrants will be redeemable by Genius in all redemption scenarios and exercisable by the holders on the same basis as the public warrants.
If holders of the private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering his, her or its warrants for that number of Genius ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Genius ordinary shares underlying the warrants, multiplied by the excess of the “Sponsor fair market value” (defined below) over the exercise price of the warrants by (y) the Sponsor fair market value. For these purposes, the “Sponsor fair market value” shall mean the average reported closing price of the Genius ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that dMY has agreed that these warrants will be exercisable on a cashless basis so long as they are held by the Sponsor and its permitted transferees is because it was not known at the time of dMY’s initial public offering whether they will be affiliated with Genius following the Business Combination. If they remain affiliated with Genius, their ability to sell Genius’s securities in the open market will be significantly limited. Genius expects to have policies in place that restrict insiders from selling Genius’s securities except during specific periods of time. Even during such periods of time when insiders will be permitted to sell Genius’s securities, an insider cannot trade in Genius’s securities if he or she is in possession of material non-public information. Accordingly, unlike public shareholders who could exercise their warrants and sell the Genius ordinary shares received upon such exercise freely in the open market in order to recoup the cost of such exercise, the insiders could be significantly restricted from selling such securities. As a result, Genius believes that allowing the holders to exercise such warrants on a cashless basis is appropriate.
dMY’s initial stockholders have agreed not to transfer, assign or sell any of the private placement warrants (including the Genius ordinary shares issuable upon exercise of any of these warrants) until the date that is 30 days after the Closing, except that, among other limited exceptions as described elsewhere in this Report, transfers can be made to our officers and directors and other persons or entities affiliated with the Sponsor. As of April 23, 2021, there were 14,213,333 Genius Warrants outstanding.
NFL Warrants
Each whole NFL Warrant entitles the registered holder to purchase one Genius ordinary share at a price of $0.01 per Share (the “NFL Exercise Price”), subject to adjustment described below. Upon each purchase of a Share pursuant to the exercise of an NFL Warrant, a B Share shall be repurchased or, in the Company’s discretion, redeemed by the Company and cancelled at par value, in each case, in accordance with the Genius governing documents. Each NFL Warrant shall be exercisable at the option of the holder from the time such NFL Warrant has vested.
Methods of Exercise
Cash Exercise
The NFL Warrants may be exercised via cash exercise, by the payment to the Company, by certified, cashier’s or other check acceptable to the Company or by wire transfer to an account designated by the Company, of an amount equal to the aggregate NFL Exercise Price of the Genius ordinary shares being purchased.
Net Issue Exercise
In lieu of exercising the NFL Warrants, the holders may elect to receive ordinary shares equal to the value of the NFL Warrants that are vested and exercisable using the following formula with respect to Genius ordinary shares that are vested and exercisable:
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Where: X = the number of the Genius ordinary share to be issued to the holder.
Y = the number of vested and exercisable NFL Warrants that are to be canceled.
A = the fair market value of one Genius ordinary share on the date of determination.
B = the per share NFL Exercise Price (as adjusted to the date of such calculation).
Anti-Dilution Adjustments
The number of and kind of securities purchasable upon exercise of any NFL Warrants and the NFL Exercise Price shall be subject to adjustment from time to time. Subject to the vesting of NFL Warrants upon a Change of Control (as defined in the Warrant Certificate) and subject to a holder’s rights pursuant to any other agreement between the holder and the Company, if at any time there shall be a merger or a consolidation of the Company with or into another entity, or a sale of all or substantially all of the assets of the Company in one or a series of related transactions, then, as part of such merger, consolidation or sale of assets, the holder will be entitled to receive upon exercise of an NFL Warrant, during the period specified in the NFL Warrant and upon payment of the aggregate NFL Exercise Price then in effect, the number of shares of stock or other securities or property (including cash) of the successor entity resulting from such merger, consolidation or sale, to which the holder as the holder of the Genius ordinary Shares deliverable upon exercise of a Warrant would have been entitled in such merger, consolidation or sale if that Warrant had been exercised immediately before such merger, consolidation or sale.
If the number of outstanding Genius ordinary shares is decreased by a consolidation, combination, reverse share split or reclassification of Genius ordinary shares or other similar event, then, on the effective date of such consolidation, combination, reverse share split, reclassification or similar event, the number of Genius ordinary shares issuable on exercise of each NFL warrant will be decreased in proportion to such decrease in outstanding Genius ordinary shares.
If the Company at any time while any NFL Warrants remain outstanding and unexpired pays a dividend with respect to Genius ordinary shares payable in Genius ordinary shares, or make any other distribution with respect to Genius ordinary shares payable in Genius ordinary shares, then the number of Genius ordinary shares underlying each NFL Warrant shall be adjusted, from and after the date of determination of the shareholders entitled to receive such dividend or distribution, to the number of Shares that the holder would have held after such dividend or distribution payable in Genius ordinary shares had such holder exercised that NFL Warrant immediately prior to the record date for the determination of shareholders entitled to receive such dividend or distribution, and the exercise price of each NFL Warrant shall be $0.01 per Genius ordinary share.
If the Company at any time pays a dividend or makes a distribution on the Genius ordinary shares (other than a dividend or distribution in Genius ordinary shares), the holder shall have the right thereafter to receive upon the exercise of any NFL Warrant, in addition to the Genius ordinary shares deliverable upon such exercise, the cash or kind and amount of other securities and property which the holder would have been entitled to receive if the holder had exercised that NFL Warrant immediately prior to the record date for the determination of shareholders entitled to receive such dividend or distribution. The amount of any such other securities and property which the holder shall thereafter be entitled to receive upon the exercise of an NFL Warrant shall be subject to adjustment from time to time, in a manner and on terms as nearly equivalent as practicable to those with respect to the Genius ordinary shares.
No fractional shares will be issued upon exercise of the NFL Warrants. If, upon exercise of the NFL Warrants, a holder would be entitled to receive a fractional interest in a share, Genius will, upon exercise, round down to the nearest whole number the number of Genius ordinary shares to be issued to the warrant holder.
Transfers
The NFL Warrants are non-transferable, except to certain Permitted Transferees (as defined in the Warrant Certificate).
Genius and the NFL have entered into the Amended and Restated Investor Rights Agreement, pursuant to which, among other things, (i) Genius will file a shelf registration statement for registration of the resale of the Warrant Shares, (ii) Genius will provide NFL customary piggyback registration rights with respect to the Warrant Shares and (iii) NFL will be subject to a customary lock-up period and certain transfer restrictions.
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Not applicable.
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Not applicable.
ITEM 13. | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES |
ITEM 14. | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS |
Not applicable.
It should be noted that while our management, including persons performing the functions of principal executive and principal financial officers for us, believeevaluating our disclosure controls and procedures, provide a reasonable level of assurancemanagement recognizes that suchany controls and procedures, are effective, they do not expect that our disclosure controls and procedures or internal controls will prevent all error and all fraud. A control system, no matter how well conceived ordesigned and operated, can provide only reasonable not absolute, assurance thatof achieving the desired control objectives, of the control system are met.
Thisand management is required to apply its judgment in evaluating and implementing possible controls and procedures.
dMY has identified a material weakness in itsestablishing and maintaining adequate internal control over financial reporting. Please see “Risk Factors—Risks Related to Genius Sports Group’s Financial Conditions—dMY has identified a material weaknessreporting (as defined in its internal control over financial reporting. This material weakness could continue to adversely affect our ability to report our resultsRule 13a-15(f) and 15d- 15(f) of operations and financial condition accurately and in a timely manner.”
Changes in Internal Control
There was no change inthe Exchange Act). Our management assessed the effectiveness of our internal control over financial reporting during the year endedas of December 31, 2020,2021. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control —Integrated Framework (2013). Based on our assessment, our management concluded that hasour internal control over financial reporting was effective as of December 31, 2021.
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public accounting firm.
| For the Year Ended December 31, 2020 | ||||
Audit Fees | $ | 255,955 | ||
Audit-Related Fees | — | |||
Tax Fees | — | |||
All Other Fees | — | |||
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Total Fees | $ | 255,955 | ||
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Year Ended | ||||||||
December 31, 2021 | December 31, 2020 | |||||||
Audit Fees | $ | 491,825 | $ | 255,955 | ||||
Audit-Related Fees | 89,610 | — | ||||||
Tax Fees | — | — | ||||||
All Other Fees | — | — | ||||||
Total Fees | $ | 581,435 | $ | 255,955 | ||||
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This exemption will expire in 2022 and the Company will no longer utilize the exception from that point onward.
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As
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| * | Filed herewith. |
| ** | Furnished herewith. |
| + | Certain schedules and similar attachments to the exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). |
GENIUS SPORTS LIMITED | ||||||
| By: | /s/ Mark Locke | |||||
| Name: | Mark Locke | |||||
| Title: | Chief Executive Officer and Director | |||||
Maven Topco
applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
April 16, 2021
Maven Topco
| Successor | ||||||||
| December 31, 2020 | December 31, 2019 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 11,781 | $ | 8,228 | ||||
Accounts receivable, net | 24,776 | 18,376 | ||||||
Contract assets | 10,088 | 5,654 | ||||||
Prepaid expenses | 4,107 | 3,207 | ||||||
Other current assets | 10,584 | 3,276 | ||||||
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Total current assets | 61,336 | 38,741 | ||||||
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Property and equipment, net | 5,002 | 4,882 | ||||||
Intangible assets, net | 114,542 | 126,440 | ||||||
Goodwill | 200,624 | 192,980 | ||||||
Deferred tax asset | 5 | 173 | ||||||
Other assets | 9,496 | 12,080 | ||||||
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Total assets | $ | 391,005 | $ | 375,296 | ||||
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LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS’ DEFICIT |
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Current liabilities: | ||||||||
Accounts payable | $ | 10,106 | $ | 13,292 | ||||
Accrued expenses | 35,220 | 21,861 | ||||||
Deferred revenue | 26,036 | 16,015 | ||||||
Current debt | 10,272 | 25 | ||||||
Other current liabilities | 3,714 | 3,461 | ||||||
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Total current liabilities | 85,348 | 54,654 | ||||||
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Long-term debt – less current portion | 82,723 | 73,166 | ||||||
Deferred tax liability | 8,097 | 6,223 | ||||||
Other liabilities | 3,589 | 3,810 | ||||||
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Total liabilities | 179,757 | 137,853 | ||||||
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Temporary equity: | ||||||||
Preference shares, $0.0001 par value, 218,561,319 shares authorized, 218,561,319 and 218,561,319 issued and outstanding at December 31, 2020 and 2019, respectively | 350,675 | 318,805 | ||||||
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Total temporary equity | 350,675 | 318,805 | ||||||
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Shareholders’ deficit | ||||||||
Common shares, $0.01 par value (A1 Ordinary Shares – 1,568,702 shares authorized, 1,568,702 and 1,568,702 issued and outstanding; A2 Ordinary Shares – 158,778 authorized, 158,778 and 158,778 issued and outstanding; A3 Ordinary Shares – 145,943 authorized, 145,943 and 145,943 issued and outstanding at December 31, 2020 and 2019, respectively) | 24 | 24 | ||||||
Additional paid-in capital | 2,393 | 2,393 | ||||||
Accumulated deficit | (153,237 | ) | (91,019 | ) | ||||
Accumulated other comprehensive income | 11,393 | 7,240 | ||||||
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Total shareholders’ deficit | (139,427 | ) | (81,362 | ) | ||||
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Total liabilities, temporary equity and shareholders’ deficit | $ | 391,005 | $ | 375,296 | ||||
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Maven Topco Limited
Consolidated Statements of Operations
(InAmounts in thousands, except share and per share data)
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||
Revenue | $ | 149,739 | $ | 114,620 | $ | 30,578 | $ | 57,007 | ||||||||
Cost of revenue | 114,066 | 89,311 | 20,780 | 31,026 | ||||||||||||
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Gross profit | 35,673 | 25,309 | 9,798 | 25,981 | ||||||||||||
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Operating expenses: | ||||||||||||||||
Sales and marketing | 13,176 | 17,711 | 4,300 | 9,334 | ||||||||||||
Research and development | 11,240 | 13,290 | 6,862 | 9,555 | ||||||||||||
General and administrative | 31,623 | 29,492 | 8,076 | 9,195 | ||||||||||||
Transaction expenses | 672 | 1,005 | — | 5,694 | ||||||||||||
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Total operating expense | 56,711 | 61,498 | 19,238 | 33,778 | ||||||||||||
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Loss from operations | (21,038 | ) | (36,189 | ) | (9,440 | ) | (7,797 | ) | ||||||||
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Loss on warrant and derivative remeasurement | — | — | — | (7,222 | ) | |||||||||||
Interest income (expense), net | (7,874 | ) | (6,840 | ) | (1,744 | ) | (2,363 | ) | ||||||||
Gain (loss) on disposal of assets | (8 | ) | (7 | ) | (5 | ) | 12 | |||||||||
Gain on fair value remeasurement of contingent consideration | 271 | — | — | — | ||||||||||||
Gain on sale of equity method investment | — | — | — | 1,800 | ||||||||||||
Gain (loss) on foreign currency | 114 | (2,537 | ) | 170 | 147 | |||||||||||
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Total other income (expenses) | (7,497 | ) | (9,384 | ) | (1,579 | ) | (7,626 | ) | ||||||||
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Loss before income taxes | (28,535 | ) | (45,573 | ) | (11,019 | ) | (15,423 | ) | ||||||||
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Income tax benefit (expense) | (1,813 | ) | 5,366 | 1,258 | (104 | ) | ||||||||||
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Net loss | $ | (30,348 | ) | $ | (40,207 | ) | $ | (9,761 | ) | $ | (15,527 | ) | ||||
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Net loss per common share: | ||||||||||||||||
Basic and diluted | $ | (16.20 | ) | $ | (21.97 | ) | $ | (5.38 | ) | $ | (5.20 | ) | ||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic and diluted | 1,873,423 | 1,829,947 | 1,812,601 | 2,983,170 | ||||||||||||
Maven Topco
December 31 | December 31 | |||||||
2021 | 2020 | |||||||
ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 222,378 | $ | 11,781 | ||||
| Accounts receivable, net | 48,819 | 24,776 | ||||||
| Contract assets | 21,753 | 10,088 | ||||||
| Prepaid expenses | 24,436 | 4,107 | ||||||
| Other current assets | 7,297 | 10,584 | ||||||
Total current assets | 324,683 | 61,336 | ||||||
| Property and equipment, net | 14,445 | 5,002 | ||||||
| Intangible assets, net | 191,219 | 114,542 | ||||||
| Goodwill | 346,418 | 200,624 | ||||||
| Deferred tax asset | 0 | 5 | ||||||
| Other assets | 10,319 | 9,496 | ||||||
Total assets | $ | 887,084 | $ | 391,005 | ||||
LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS’ EQUITY (DEFICIT) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 19,881 | $ | 10,106 | ||||
| Accrued expenses | 55,889 | 35,220 | ||||||
| Deferred revenue | 29,871 | 26,036 | ||||||
| Current debt | 23 | 10,272 | ||||||
| Derivative warrant liabilities | 16,794 | 0 | ||||||
| Other current liabilities | 30,354 | 3,714 | ||||||
Total current liabilities | 152,812 | 85,348 | ||||||
| Long-term debt – less current portion | 65 | 82,723 | ||||||
| Deferred tax liability | 16,902 | 8,097 | ||||||
| Other liabilities | 11,127 | 3,589 | ||||||
Total liabilities | 180,906 | 179,757 | ||||||
| Temporary equity: | ||||||||
| Preference shares, $0.0001 par value, NaN authorized, issued and outstanding at December 31, 2021; 218,561,319 shares authorized, issued and outstanding at December 31, 2020 | 0 | 350,675 | ||||||
Total temporary equity | 0 | 350,675 | ||||||
| Shareholders’ equity (deficit) | ||||||||
Common stock, $0.01 par value, unlimited shares authorized, 193,585,625 shares issued and outstanding at December 31, 2021; 70,040,242 shares authorized, issued and outstanding at December 31, 2020 | 1,936 | 700 | ||||||
| B Shares, $0.0001 par value, 22,500,000 shares authorized, 18,500,000 shares issued and outstanding at December 31, 2021; NaN authorized, issued and outstanding at December 31, 2020 | 2 | 0 | ||||||
Additional paid-in capital | 1,461,730 | 1,717 | ||||||
| Accumulated deficit | (757,317 | ) | (153,237 | ) | ||||
| Accumulated other comprehensive income (loss) | (173 | ) | 11,393 | |||||
| Total shareholders’ equity (deficit) | 706,178 | (139,427 | ) | |||||
Total liabilities, temporary equity and shareholders’ equity (deficit) | $ | 887,084 | $ | 391,005 | ||||
Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | ||||||||||
2021 | 2020 | 2019 | ||||||||||
| Revenue | $ | 262,735 | $ | 149,739 | $ | 114,620 | ||||||
| Cost of revenue | 476,168 | 114,066 | 89,311 | |||||||||
| Gross (loss) profit | (213,433 | ) | 35,673 | 25,309 | ||||||||
| Operating expenses: | ||||||||||||
| Sales and marketing | 27,292 | 13,176 | 17,711 | |||||||||
| Research and development | 26,513 | 11,240 | 13,290 | |||||||||
| General and administrative | 293,168 | 31,623 | 29,492 | |||||||||
| Transaction expenses | 12,886 | 672 | 1,005 | |||||||||
| Total operating expense | 359,859 | 56,711 | 61,498 | |||||||||
| Loss from operations | (573,292 | ) | (21,038 | ) | (36,189 | ) | ||||||
| Interest expense, net | (3,331 | ) | (7,874 | ) | (6,840 | ) | ||||||
| Loss on disposal of assets | (46 | ) | (8 | ) | (7 | ) | ||||||
| Gain (loss) on fair value remeasurement of contingent consideration | (19,405 | ) | 271 | 0 | ||||||||
| Change in fair value of derivative warrant liabilities | (11,412 | ) | 0 | 0 | ||||||||
| Gain (loss) on foreign currency | 3,032 | 114 | (2,537 | ) | ||||||||
| Total other income (expenses) | (31,162 | ) | (7,497 | ) | (9,384 | ) | ||||||
| Loss before income taxes | (604,454 | ) | (28,535 | ) | (45,573 | ) | ||||||
| Income tax benefit (expense) | 11,701 | (1,813 | ) | 5,366 | ||||||||
Net loss | $ | (592,753 | ) | $ | (30,348 | ) | $ | (40,207 | ) | |||
| Net loss per common share: | ||||||||||||
| Basic and diluted | $ | (3.93 | ) | $ | (0.43 | ) | $ | (0.59 | ) | |||
Weighted average common shares outstanding: | ||||||||||||
Basic and diluted | 150,912,333 | 70,040,242 | 68,414,830 | |||||||||
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||
Net loss | $ | (30,348 | ) | $ | (40,207 | ) | $ | (9,761 | ) | $ | (15,527 | ) | ||||
Other comprehensive loss: | ||||||||||||||||
Foreign currency translation adjustments | 4,153 | 10,351 | (3,111 | ) | 332 | |||||||||||
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Comprehensive loss | $ | (26,195 | ) | $ | (29,856 | ) | $ | (12,872 | ) | $ | (15,195 | ) | ||||
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Maven Topco
Year Ended | Year Ended | Year Ended | ||||||||||
December 31, | December 31, | December 31, | ||||||||||
2021 | 2020 | 2019 | ||||||||||
| Net loss | $ | (592,753) | $ | (30,348) | $ | (40,207) | ||||||
| Other comprehensive loss: | ||||||||||||
| Foreign currency translation adjustments | (11,566 | ) | 4,153 | 10,351 | ||||||||
| Comprehensive loss | $ | (604,319 | ) | $ | (26,195 | ) | $ | (29,856 | ) | |||
Equity (Deficit)
Predecessor | Successor | |||||||||||||||||||||||||||||||||||
| Temporary Equity | Permanent Equity | |||||||||||||||||||||||||||||||||||
| Common Shares | Amounts | Preference Shares | Amounts | Common Shares | Amounts | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Shareholders’ Deficit | |||||||||||||||||||||||||||
Balance at 12/31/2017, Predecessor | 2,837,383 | — | — | — | — | — | $ | 8,345 | $ | (1,958 | ) | $ | 1,014 | $ | 7,401 | |||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | (15,527 | ) | — | (15,527 | ) | ||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | — | — | 332 | 332 | ||||||||||||||||||||||||||
Exercise of stock options | 10,000 | �� | — | — | — | — | — | 41 | — | — | 41 | |||||||||||||||||||||||||
Issuance of common shares upon warrant settlement | 136,707 | — | — | — | — | — | 8,705 | — | — | 8,705 | ||||||||||||||||||||||||||
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Balance at 9/7/2018, Predecessor | 2,984,090 | — | — | — | — | — | $ | 17,091 | $ | (17,485 | ) | $ | 1,346 | $ | 952 | |||||||||||||||||||||
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Balance at 9/8/2018, Successor | — | — | 213,657,244 | $ | 275,640 | 1,812,601 | $ | 23 | $ | 2,315 | $ | (3,966 | ) | — | $ | (1,628 | ) | |||||||||||||||||||
Net loss | — | — | — | — | — | — | — | (9,761 | ) | — | (9,761 | ) | ||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | — | — | (3,111 | ) | (3,111 | ) | ||||||||||||||||||||||||
Preference share accretion | — | — | — | 8,763 | — | — | — | (8,763 | ) | — | (8,763 | ) | ||||||||||||||||||||||||
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Balance at 12/31/2018, Successor | — | — | 213,657,244 | 284,403 | 1,812,601 | 23 | 2,315 | (22,490 | ) | (3,111 | ) | (23,263 | ) | |||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | (40,207 | ) | — | (40,207 | ) | ||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | — | — | 10,351 | 10,351 | ||||||||||||||||||||||||||
Issuance of common shares | — | — | — | — | 60,822 | 1 | 78 | — | — | 79 | ||||||||||||||||||||||||||
Issuance of preference shares | — | — | 4,904,075 | 6,080 | — | — | — | — | — | — | ||||||||||||||||||||||||||
Preference share accretion | — | — | — | 28,322 | — | — | — | (28,322 | ) | — | (28,322 | ) | ||||||||||||||||||||||||
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Balance at | — | — | 218,561,319 | 318,805 | 1,873,423 | 24 | 2,393 | (91,019 | ) | 7,240 | (81,362 | ) | ||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | (30,348 | ) | — | (30,348 | ) | ||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | — | — | 4,153 | 4,153 | ||||||||||||||||||||||||||
Preference share accretion | — | — | — | 31,870 | — | — | — | (31,870 | ) | — | (31,870 | ) | ||||||||||||||||||||||||
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Balance at December 31, 2020, Successor | — | — | 218,561,319 | $ | 350,675 | 1,873,423 | $ | 24 | $ | 2,393 | $ | (153,237 | ) | $ | 11,393 | $ | (139,427 | ) | ||||||||||||||||||
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Maven Topco
| Temporary Equity | Permanent Equity | |||||||||||||||||||||||||||||||||||||||
| Preference Shares | Amounts | Common Stock | Amounts | B Shares | Amounts | Additional Paid in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Shareholders’ Equity (Deficit) | |||||||||||||||||||||||||||||||
Balance at January 1, 2019 | 213,657,244 | $ | 284,403 | 1,812,601 | $ | 23 | — | $ | — | $ | 2,315 | $ | (22,490 | ) | $ | (3,111) | $ | (23,263 | ) | |||||||||||||||||||||
| Retroactive application of reverse capitalization | — | — | 65,953,736 | 654 | — | — | (654 | ) | — | — | — | |||||||||||||||||||||||||||||
Balance at January 1, 2019, effect of reverse capitalization Reverse )Capitalization | 213,657,244 | $ | 284,403 | 67,766,337 | $ | 677 | — | $ | — | $ | 1,661 | $ | (22,490 | ) | $ | (3,111 | ) | $ | (23,263 | ) | ||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | (40,207 | ) | — | (40,207 | ) | ||||||||||||||||||||||||||||
| Foreign currency translation adjustment | — | — | — | — | — | — | — | — | 10,351 | 10,351 | ||||||||||||||||||||||||||||||
| Issuance of common shares | — | — | 2,273,905 | 23 | — | — | 56 | — | — | 79 | ||||||||||||||||||||||||||||||
| Issuance of preference shares | 4,904,075 | 6,080 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||
| Preferred share accretion | — | 28,322 | — | — | — | — | — | (28,322 | ) | — | (28,322 | ) | ||||||||||||||||||||||||||||
Balance at December 31, 2019 | 218,561,319 | $ | 318,805 | 70,040,242 | $ | 700 | — | $ | — | $ | 1,717 | $ | (91,019) | $ | 7,240 | $ | (81,362 | ) | ||||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | (30,348 | ) | — | (30,348 | ) | ||||||||||||||||||||||||||||
| Foreign currency translation adjustment | — | — | — | — | — | — | — | — | 4,153 | 4,153 | ||||||||||||||||||||||||||||||
| Preferred share accretion | — | 31,870 | — | — | — | — | — | (31,870 | ) | — | (31,870 | ) | ||||||||||||||||||||||||||||
Balance at December 31, 2020 | 218,561,319 | $ | 350,675 | 70,040,242 | $ | 700 | — | $ | — | $ | 1,717 | $ | (153,237 | ) | $ | 11,393 | $ | (139,427 | ) | |||||||||||||||||||||
| Net loss | — | — | — | — | — | — | — | (592,753 | ) | — | (592,753 | ) | ||||||||||||||||||||||||||||
| Foreign currency translation adjustment | — | — | — | — | — | — | — | — | (11,566 | ) | (11,566 | ) | ||||||||||||||||||||||||||||
| Preferred share accretion | — | 11,327 | — | — | — | — | — | (11,327 | ) | — | (11,327 | ) | ||||||||||||||||||||||||||||
| Merger recapitalization | (218,561,319 | ) | (362,002 | ) | 9,547,104 | 96 | — | — | 49,842 | — | — | 49,938 | ||||||||||||||||||||||||||||
| Merger and PIPE financing, net of equity issuance costs of $38,215 | — | — | 67,498,704 | 675 | — | — | 481,182 | — | — | 481,857 | ||||||||||||||||||||||||||||||
| Issuance of common stock in connection with additional equity offering, net of equity issuance costs of $9,293 | — | — | 13,000,000 | 130 | — | — | 237,577 | — | — | 237,707 | ||||||||||||||||||||||||||||||
| Issuance of common stock in connection with business combinations | — | — | 6,106,232 | 61 | — | — | 110,430 | — | — | 110,491 | ||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | 466,306 | — | — | 466,306 | ||||||||||||||||||||||||||||||
| Vesting of restricted shares | — | — | 22,650,546 | 227 | — | — | 1,240 | — | — | 1,467 | ||||||||||||||||||||||||||||||
| Issuance of B shares | — | — | — | — | 18,500,000 | 2 | — | — | — | 2 | ||||||||||||||||||||||||||||||
| Issuance of common stock in connection with additional equity offering, net of equity issuance costs of $583 | — | — | 928,447 | 9 | — | — | 17,058 | — | — | 17,067 | ||||||||||||||||||||||||||||||
| Issuance of common stock in connection with warrant redemptions | — | — | 3,814,350 | 38 | — | — | 96,378 | — | — | 96,416 | ||||||||||||||||||||||||||||||
Balance at December 31, 2021 | — | $ | — | 193,585,625 | $ | 1,936 | 18,500,000 | $ | 2 | $ | 1,461,730 | $ | (757,317 | ) | $ | (173) | $ | 706,178 | ||||||||||||||||||||||
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||
Cash flows from operating activities: | ||||||||||||||||
Net loss | $ | (30,348 | ) | $ | (40,207 | ) | $ | (9,761 | ) | $ | (15,527 | ) | ||||
Adjustments to reconcile net loss to net cash provided by operating activities: |
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Depreciation and amortization | 35,043 | 27,974 | 7,263 | 10,037 | ||||||||||||
Loss (gain) on disposal of assets | 8 | 7 | 5 | (12 | ) | |||||||||||
Gain on fair value remeasurement of contingent consideration | (271 | ) | — | — | — | |||||||||||
Gain on sale of equity method investment | — | — | — | (1,800 | ) | |||||||||||
Non-cash interest expense (income), net | 6,835 | 6,440 | 1,743 | 2,362 | ||||||||||||
Amortization of contract costs | 538 | 231 | 8 | 563 | ||||||||||||
Deferred income taxes | 1,304 | (5,480 | ) | (1,132 | ) | (592 | ) | |||||||||
Loss on warrant and derivatives remeasurement | — | — | — | 7,222 | ||||||||||||
Loss (gain) on foreign currency remeasurement | 464 | 2,023 | 297 | (409 | ) | |||||||||||
Changes in assets and liabilities, net of effect of Business Combinations |
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Accounts receivable, net | (5,046 | ) | (7,408 | ) | 2,249 | 370 | ||||||||||
Contract assets | (4,030 | ) | (1,872 | ) | (685 | ) | (2,204 | ) | ||||||||
Prepaid expenses | (749 | ) | (537 | ) | (660 | ) | 3 | |||||||||
Other current assets | (6,682 | ) | (1,728 | ) | (1,013 | ) | 173 | |||||||||
Other assets | 2,321 | (4,413 | ) | (1,243 | ) | (225 | ) | |||||||||
Accounts payable | (3,384 | ) | 7,136 | 1,792 | 934 | |||||||||||
Accrued expenses | 11,930 | 10,164 | 1,322 | 6,958 | ||||||||||||
Deferred revenue | 9,021 | 8,598 | (776 | ) | 1,496 | |||||||||||
Other current liabilities | 520 | 1,189 | 398 | (510 | ) | |||||||||||
Other liabilities | (401 | ) | 375 | — | — | |||||||||||
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Net cash provided by (used in) operating activities | 17,073 | 2,492 | (193 | ) | 8,839 | |||||||||||
Cash flows from investing activities: | ||||||||||||||||
Purchases of property and equipment | (1,464 | ) | (3,217 | ) | (883 | ) | (747 | ) | ||||||||
Capitalization of internally developed software costs | (15,920 | ) | (20,756 | ) | (4,804 | ) | (13,249 | ) | ||||||||
Purchases of intangible assets | (1,389 | ) | (279 | ) | (293 | ) | (161 | ) | ||||||||
Acquisition of business, net of cash acquired | (3,934 | ) | (470 | ) | — | — | ||||||||||
Proceeds from disposal of assets | 51 | 99 | 93 | 22 | ||||||||||||
Proceeds from sale of equity method investment | — | — | — | 2,040 | ||||||||||||
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Net cash used in investing activities | (22,656 | ) | (24,623 | ) | (5,887 | ) | (12,095 | ) | ||||||||
Cash flows from financing activities: | ||||||||||||||||
Proceeds from issuance of common shares | — | 79 | — | — | ||||||||||||
Proceeds from issuance of preference shares | — | 6,079 | — | — | ||||||||||||
Proceeds from deposits on incentive securities | 93 | 66 | — | — | ||||||||||||
Proceeds from borrowings | 10,024 | 1,394 | — | 4,775 | ||||||||||||
Repayment of loans and mortgage | (21 | ) | (21 | ) | (51 | ) | (15 | ) | ||||||||
Payment of contingent consideration | — | (666 | ) | (160 | ) | (1,235 | ) | |||||||||
Proceeds from exercise of stock options | — | — | — | 41 | ||||||||||||
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Net cash provided by (used in) financing activities | 10,096 | 6,931 | (211 | ) | 3,566 | |||||||||||
Effect of exchange rate changes on cash and cash equivalents | (960 | ) | (408 | ) | (524 | ) | 200 | |||||||||
Net increase (decrease) in cash and cash equivalents | 3,553 | (15,608 | ) | (6,815 | ) | 510 | ||||||||||
Cash and cash equivalents, beginning of period | 8,228 | 23,836 | 30,651 | 2,897 | ||||||||||||
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Cash and cash equivalents, end of period | $ | 11,781 | $ | 8,228 | $ | 23,836 | $ | 3,407 | ||||||||
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Supplemental disclosure of cash activities: | ||||||||||||||||
Cash paid (received) during the period for interest | $ | 1,039 | $ | 400 | $ | 1 | $ | 1 | ||||||||
Cash paid (received) during the period for income taxes | $ | 891 | $ | 876 | $ | 28 | $ | 61 | ||||||||
Supplemental disclosure of noncash investing and financing activities: |
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Preference share accretion | $ | 31,870 | $ | 28,322 | $ | 8,763 | $ | — | ||||||||
Deferred offering costs included in other current assets and accrued expenses | $ | 2,093 | $ | — | $ | — | $ | — | ||||||||
Contingent consideration for acquisition of business included in other liabilities | $ | — | $ | 2,385 | $ | — | $ | — | ||||||||
Settlement of warrant liability | $ | — | $ | — | $ | — | $ | 8,705 | ||||||||
Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | ||||||||||
2021 | 2020 | 2019 | ||||||||||
Cash Flows from operating activities: | ||||||||||||
Net loss | $(592,753) | $(30,348) | �� | $(40,207) | ||||||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||||||
Depreciation and amortization | 59,351 | 35,043 | 27,974 | |||||||||
Loss on disposal of assets | 46 | 8 | 7 | |||||||||
(Gain) loss on fair value remeasurement of contingent consideration | 19,405 | (271 | ) | — | ||||||||
Stock-based compensation | 489,474 | — | — | |||||||||
Change in fair value of derivative warrant liabilities | 11,412 | — | — | |||||||||
Non-cash interest expense (income), net | 2,444 | 6,835 | 6,440 | |||||||||
Amortization of contract cost | 808 | 538 | 231 | |||||||||
Deferred income taxes | (13,409 | ) | 1,304 | (5,480 | ) | |||||||
Loss on foreign currency remeasurement | 192 | 464 | 2,023 | |||||||||
Changes in assets and liabilities | ||||||||||||
Effect of business combinations | (22,411 | ) | — | — | ||||||||
Accounts receivable, net | (24,306 | ) | (5,046 | ) | (7,408 | ) | ||||||
Contract asset | (11,906 | ) | (4,030 | ) | (1,872 | ) | ||||||
Prepaid expenses | (20,563 | ) | (749 | ) | (537 | ) | ||||||
Other current assets | 3,350 | (6,682 | ) | (1,728 | ) | |||||||
Other assets | (1,702 | ) | 2,321 | (4,413 | ) | |||||||
Accounts payable | 9,577 | (3,384 | ) | 7,136 | ||||||||
Accrued expenses | 20,858 | 11,930 | 10,164 | |||||||||
Deferred revenue | 4,050 | 9,021 | 8,598 | |||||||||
Other current liabilities | 2,218 | 520 | 1,189 | |||||||||
Other liabilities | 557 | (401 | ) | 375 | ||||||||
Net cash provided by (used in) operating activities | (63,308 | ) | 17,073 | 2,492 | ||||||||
Cash flows from investing activities: | ||||||||||||
Purchases of property and equipment | (6,417 | ) | (1,464 | ) | (3,217 | ) | ||||||
Capitalization of internally developed software costs | (26,920 | ) | (15,920 | ) | (20,756 | ) | ||||||
Repayment of executive loan notes | 4,738 | — | — | |||||||||
Purchases of intangible assets | (25 | ) | (1,389 | ) | (279 | ) | ||||||
Acquisition of business, net of cash acquired | (103,871 | ) | (3,934 | ) | (470 | ) | ||||||
Proceeds from disposal of assets | 176 | 51 | 99 | |||||||||
Net cash used in investing activities | (132,319 | ) | (22,656 | ) | (24,623 | ) | ||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from merger with dMY Technology Group, Inc. II | 276,341 | — | — | |||||||||
Proceeds from issuance of common shares | — | — | 79 | |||||||||
Proceeds from issuance of preference shares | — | — | 6,079 | |||||||||
Payment of contingent consideration | — | — | (666 | ) | ||||||||
dMY Technology Group, Inc. II transaction costs | (24,828 | ) | — | — | ||||||||
Capitalization of Genius equity issuance costs | (20,217 | ) | — | — | ||||||||
PIPE financing, net of equity issuance costs | 316,800 | — | — | |||||||||
Issuance of common stock in connection with additional equity offering, net of equity issuance costs | 254,774 | — | — | |||||||||
Issuance of B shares | 2 | — | — | |||||||||
Preference shares payout and Incentive Securities Catch-Up Payment | (313,162 | ) | — | — | ||||||||
Repayment of loans and mortgage | (96,959 | ) | (21 | ) | (21 | ) | ||||||
Proceeds from borrowings | — | 10,024 | 1,394 | |||||||||
Proceeds from exercise of Public Warrants | 17,613 | — | — | |||||||||
Proceeds from shareholder deposits | — | 93 | 66 | |||||||||
Net cash provided by financing activities | 410,364 | 10,096 | 6,931 | |||||||||
Effect of exchange rate changes on cash | (4,140 | ) | (960 | ) | (408 | ) | ||||||
Net increase (decrease) in cash | 210,597 | 3,553 | (15,608 | ) | ||||||||
Cash, beginning of period | 11,781 | 8,228 | 23,836 | |||||||||
Cash, end of period | $ | 222,378 | $ | 11,781 | $ | 8,228 | ||||||
Supplemental disclosure of cash activities: | ||||||||||||
Cash paid during the period for interest | $ | 887 | $ | 1,039 | $ | 400 | ||||||
Cash paid during the period for income taxes | $ | 3,542 | $ | 891 | $ | 876 | ||||||
Supplemental disclosure of noncash investing and financing activities: | ||||||||||||
Preferred share accretion | $ | 11,327 | $ | 31,870 | $ | 28,322 | ||||||
Deferred offering costs included in other current assets and accrued expenses | $ | — | $ | 2,093 | $ | — | ||||||
Contingent consideration for acquisition of business included in other liabilities | $ | — | $ | — | $ | 2,385 | ||||||
Conversion of preference shares to common stock | $ | 69,272 | $ | — | $ | — | ||||||
Warrants acquired as part of merger with dMY Technology Group, Inc. II | $ | (84,664 | ) | $ | — | $ | — | |||||
Exercise of Private Placement Warrants | $ | 65,876 | $ | — | $ | — | ||||||
Note | 1. Description of Business and Summary of Significant Accounting Policies |
��GENI WS”, respectively. Merger. For periods prior to the Merger, the reported share and per share amounts have been retroactively converted by applying the Exchange Ratio.Maven Topcoin Guernsey on July 18, 2018October 21, 2020 under the laws of Guernsey. The Company was formed for the purpose of effectuating a merger pursuant to a definitive business combination agreement (“Business Combination Agreement”), dated October 27, 2020, by and among dMY Technology Group, Inc. II (“dMY”), Maven Topco Limited (“Maven Topco”) in connection with, Maven Midco Limited, Galileo NewCo Limited, Genius Merger Sub, Inc., and dMY Sponsor II, LLC (the “Merger”). Upon the investment by Apax Funds (as defined below) inclosing of the Merger on April 20, 2021 (the “Closing”), the Company changed its name from Galileo NewCo Limited to Genius Sports Group Limited (the “Apax Funds Investment’). Maven TopcoLimited. The Company’s ordinary shares and its wholly-owned subsidiariespublic warrants are collectively referred to ascurrently listed on the “Company”. Genius Sports Group Limited, is a private company incorporated on July 28, 2015,New York Stock Exchange (“NYSE”) under the symbol “GENI” and headquartered in London, England (“Genius Sports”). In connection with the Apax Funds Investment, on September 7, 2018, Genius Sports and its wholly-owned subsidiaries became wholly-owned subsidiaries of the Company. “Apax Funds” refers to certain funds the ultimate general partners of which are advised by Apax Partners LLP (“Apax”).end-user,On September 7, 2018,its wholly owned subsidiary Maven Bidco Limited (“Maven Bidco”), acquired all outstanding equity interests in Genius Sports, and its wholly-owned subsidiaries. Maven Topcoownership of the Company. The capital reorganization was immediately followed by the acquisition of dMY, which was accounted for within the acquisition as a business combination using the acquisitionscope of Accounting Standards Codification (“ASC”) 805, Business Combinations (“ASC 805”). Under this method of accounting. See Note 2 – Business Combinationsaccounting, dMY was treated as the “acquired” company for further details. The acquisition resulted in a change infinancial reporting purposes. This determination was primarily based on post-combination relative voting rights, composition of the governing board, relative size of thebasis andpurposes, the financial statement presentation distinguishesMerger was treated as the equivalent of the Company as the “Successor” for reporting periods following the acquisition, September 8, 2018 through December 31, 2018 and the years ended December 31, 2020 and 2019, and Genius Sports as the “Predecessor”issuing stock for the periodnet assets of dMY, accompanied by a recapitalization. The net assets of dMY were stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the acquisition, January 1, 2018 through September 7, 2018. Successor financial statements reflect a new basisMerger are those of accounting that islegacy Maven Topco. Upon Closing, outstanding capital stock of legacy shareholders of Maven Topco was converted to the Company’s common stock, in an amount determined by application of the exchange ratio of 37.38624 (“Exchange Ratio”), which was based on the fair value of net assets acquired by the Company. This change in accounting basis is represented in the accompanying consolidated financial statements by a black line which appears between the columns entitled Successor and Predecessor in the statements and in the relevant accompanying notes. The black line signifies that financial statements presented for Successor periods subsequentMaven Topco’s implied price per share prior to the acquisition are presented on a measurement basis different from Predecessor periods.
In March 2020,
Financial Instruments
results. The fair valuerevenue of the Company’s assetscustomers and liabilities, which qualifysports organizations and the Company’s revenue continues to depend on sports events taking place, and the Company may not generate as financial instruments under ASC 820, Fair Value Measurements and Disclosures, approximatesmuch revenue as we would have without the carrying amounts representedcancellation or postponements in the consolidated balance sheets.
2020.
2020.
Estimated Useful Lives | ||||
(years) | ||||
Buildings | 50 | |||
IT equipment | 3 | |||
Furniture and fixtures | 4 | |||
Other equipment | 10 | |||
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2019.
As of January 1, 2018, Genius Sports held an investment in Pointsbet Holding Pty Ltd. (“Pointsbet”). Genius Sports accounted for its investment in Pointsbet under the equity method of accounting. In the predecessor period, Genius Sports disposed of its investment in Pointsbet. This sale, resulted in Genius Sports recognizing a $1.8 million gain on disposal recognized in the period from January 1, 2018 through September 7, 2018 (Predecessor).
2020.
Warrants
The Company accounts for its common share warrants (“Warrants”) as
Fair Value Measurement
measurement date. The Company uses valuation approaches that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels:
During
consolidated balance sheets.
Under ASC 606,requires companies to recognize revenue in a way that depicts the Company recognizes revenue upon transfer of control of promised productsgoods or services to customers in an amount that reflects the consideration to which the Companyentity expects to receivebe entitled in exchange for those productsgoods or services. In addition, the standard requires more detailed disclosures to enable readers of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers.
Media Technology, Content
Video Augmentation
augmented video streams will be provided. The video augmentation services are generally provided over a contract term of one year or less. The arrangements contain fixed fees, which are generally prepaid by customers. Revenue is recognized over time as the services are performed using an inputoutput method based on costs to secure advertising space. The Company is the principal in these arrangements as it is primarily responsible for delivering the advertisements, and bears inventory risk; therefore, revenue is presented gross.
video augmentations delivered.
Financing Componentsfinancing components
Modifications
Estimates
equipment.
they occur.
In August 2018, the FASB issued ASU 2018-15,Intangibles Goodwill and Other Internal-Use Software (Topic 350-40). This ASU addresses users’ accounting for implementation costs incurred in a cloud computing arrangement that is a service contract and also adds certain disclosure requirements related to implementation costs incurred for internal-use software and cloud computing arrangements. The amendment aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). ASU 2018-15 is effective for fiscal years beginning January 1, 2021. The amendments in this ASU can be applied either retrospectively or prospectively to all implementation costs incurred after the date
dMY Class A common stock outstanding prior to the Merger | 27,600,000 | |||
Less: redemption of dMY shares | 1,296 | |||
Genius ordinary shares issued to dMY Class A common stockholders | 27,598,704 | |||
Genius ordinary shares issued to dMY Class B common stockholders | 6,900,000 | |||
Genius ordinary shares issued to PIPE Investors | 33,000,000 | |||
Total Genius ordinary shares issued in connection with the Merger and PIPE Investment | 67,498,704 | |||
Genius ordinary shares converted from legacy Maven Topco shares (1) | 100,137,777 | |||
Total Genius ordinary shares issued immediately after the Merger | 167,636,481 |
(1) | Includes 79,587,346 Genius ordinary shares converted from existing classes of shares of Maven Topco and 20,550,431 Genius ordinary shares related to vested rollover Incentive Securities. See Note 15 – Stock-based Compensation fo r further details. |
|
Apax Funds Investment in Genius Sports
In connection with the Apax Funds Investment on September 7, 2018,
June 15, 2021.
| Consideration Transferred | ||||
Cash for outstanding Genius Sports equity shares | $ | 264,471 | ||
Cash paid to retire Genius Sports’ debt | 33,343 | |||
Transaction costs paid on behalf of Genius Sports | 5,422 | |||
|
| |||
Total consideration transferred | $ | 303,236 | ||
|
| |||
Cash consideration for 100% of the shares of Genius Sports amounted to $264.5 million. The aggregate consideration transferred included approximately $33.3 million related to the repayment of certain outstanding loans and notes of Genius Sports, and $5.4 million of sell-side transaction costs paid for by the Company on behalf of Genius Sports. These transaction costs incurred by Genius Sports are included in the Predecessor period within transaction expenses in the consolidated statements of operations.
Consideration Transferred | ||||
Cash for outstanding Second Spectrum capital stock (1) | $ | 111,535 | ||
Fair value of Genius Sports Limited common stock issued for outstanding Second Spectrum capital stock (2) | 83,291 | |||
Cash for vested outstanding Second Spectrum equity awards (3) | 3,490 | |||
Total consideration transferred | $ | 198,316 | ||
(1) | Includes cash consideration paid to former Second Spectrum shareholders totaling $111.5 million. |
(2) | Represents the issuance of 4.7 million shares of the Company’s common stock at June 15 , 2021 closing price of $17.74 per share to the former Second Spectrum shareholders. See Note 16 – Fair Value Measurements for details of additional shares issued in early 2022. |
(3) | Includes $3.5 million cash settlement of Second Spectrum’s vested outstanding stock options as of June 15 , 2021 associated with the pre-acquisition services provided by former Second Spectrum shareholders. |
| Fair Value of Assets Acquired | As of September 7, 2018 | |||
Cash and cash equivalents | $ | 3,407 | ||
Accounts receivables, net | 12,610 | |||
Contract assets | 2,925 | |||
Prepaid expenses | 1,917 | |||
Other current assets | 427 | |||
Property and equipment, net | 3,034 | |||
Intangible assets, net | 129,772 | |||
Goodwill | 185,030 | |||
Deferred tax asset | 116 | |||
Other assets | 1,480 | |||
|
| |||
Total assets acquired | $ | 340,718 | ||
Accounts payable | 5,643 | |||
Accrued expenses | 9,672 | |||
Deferred revenue | 7,669 | |||
Other current liabilities | 1,625 | |||
Long-term debt | 202 | |||
Deferred tax liability | 12,671 | |||
|
| |||
Total liabilities assumed | $ | 37,482 | ||
|
| |||
Consideration transferred | $ | 303,236 | ||
|
| |||
Fair value of net assets acquired | ||||
Cash and cash equivalents | $ | 43,865 | ||
Accounts receivables, net | 1,126 | |||
Prepaid expenses | 252 | |||
Other current assets | 1 | |||
Property and equipment, net | 5,187 | |||
Intangible assets, net | 83,800 | |||
Other assets | 167 | |||
Goodwill (1) | 101,411 | |||
Total assets acquired | $ | 235,809 | ||
Accounts payable | 273 | |||
Accrued expenses | 13,961 | |||
Deferred revenue | 6,670 | |||
Other current liabilities | 454 | |||
Deferred tax liability | 16,135 | |||
Total liabilities assumed | $ | 37,493 | ||
Total consideration transferred | $ | 198,316 | ||
(1) | Reflects a working capital adjustment of $1.1 million in the fourth quarter of fiscal year 2021 |
| Useful Lives | As of September 7, 2018 | |||||||
Data rights | 10 years | $ | 67,959 | |||||
Technology | 3 years | 38,958 | ||||||
Marketing products | 3 – 15 years | 22,855 | ||||||
|
| |||||||
Total intangible assets subject to amortization | $ | 129,772 | ||||||
|
| |||||||
Useful Lives | As of June 15, 2021 | |||||
(years) | (in thousands) | |||||
Technology | 3 | $ | 50,000 | |||
Marketing products (1) | 3 – 15 | 33,800 | ||||
Total intangible assets acquired subject to amortization | $ | 83,800 | ||||
(1) | Includes customer relationships of $31.0 million with a useful life of 3 years and trademarks of $2.8 million with an useful life of 15 years |
The
2021 included revenue of $13.8 million and net loss of $12.0 million from Second Spectrum since the acquisition date of June 15, 2021.
Year Ended December 31, | ||||||||
2021 | 2020 | |||||||
Pro forma revenue | $ | 272,281 | $ | 167,002 | ||||
Pro forma net loss | (588,284 | ) | (88,484 | ) | ||||
| (1) | Transaction costs of approximately $10.7 million are assumed to have occurred on January 1, 2020 and are recognized as if incurred in the first quarter of 2020. Of these transaction costs, $6.6 million are incurred by Second Spectrum and $4.1 million are incurred by the Company. |
| (2) | Payment of approximately $1.6 million related to the acceleration of Second Spectrum’s historical unvested stock options as a result of the acquisition is assumed to have occurred on January 1, 2020 and is recognized as if incurred in the first quarter of 2020. |
consideration, respectively.
|
| Successor | Predecessor | |||||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||||
Revenue by Product Group | ||||||||||||||||||
Betting Technology, Content and Services | $ | 110,618 | $ | 88,370 | $ | 21,581 | $ | 47,531 | ||||||||||
Sports Technology and Services | 16,066 | 14,367 | 5,187 | 3,741 | ||||||||||||||
Media Technology, Content and Services | 23,055 | 11,883 | 3,810 | 5,735 | ||||||||||||||
|
|
|
|
|
|
|
| |||||||||||
Total | $ | 149,739 | $ | 114,620 | $ | 30,578 | $ | 57,007 | ||||||||||
|
|
|
|
|
|
|
| |||||||||||
Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | ||||||||||
2021 | 2020 | 2019 | ||||||||||
Revenue by Product Group | ||||||||||||
Betting Technology, Content and Services | $ | 177,201 | $ | 110,618 | $ | 88,370 | ||||||
Media Technology, Content and Services | 48,312 | 23,055 | 11,883 | |||||||||
Sports Technology and Services | 37,222 | 16,066 | 14,367 | |||||||||
Total | $ | 262,735 | $ | 149,739 | $ | 114,620 | ||||||
| Successor | Predecessor | |||||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||||
Revenue by Geographical Market: | ||||||||||||||||||
Europe | $ | 119,393 | $ | 90,453 | $ | 23,347 | $ | 43,524 | ||||||||||
Americas | 20,419 | 15,699 | 4,188 | 7,809 | ||||||||||||||
Rest of the World | 9,927 | 8,468 | 3,043 | 5,674 | ||||||||||||||
|
|
|
|
|
|
|
| |||||||||||
Total | $ | 149,739 | $ | 114,620 | $ | 30,578 | $ | 57,007 | ||||||||||
|
|
|
|
|
|
|
| |||||||||||
Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | ||||||||||
2021 | 2020 | 2019 | ||||||||||
Revenue by geographical market: | ||||||||||||
Europe | $ | 175,731 | $ | 119,393 | $ | 90,453 | ||||||
Americas | 69,278 | 20,419 | 15,699 | |||||||||
Rest of the world | 17,726 | 9,927 | 8,468 | |||||||||
Total | $ | 262,735 | $ | 149,739 | $ | 114,620 | ||||||
other sources in relation to equipment rental income.
2020.
|
| Successor | ||||||||
| As of December 31, 2020 | As of December 31, 2019 | |||||||
Balance, beginning of period | $ | 760 | $ | 1,926 | ||||
Increase (decrease) in provision | 582 | 1,059 | ||||||
Write-offs, net of recoveries | (122 | ) | (2,256 | ) | ||||
Foreign currency translation adjustments | 50 | 31 | ||||||
|
|
|
| |||||
Balance, end of period | $ | 1,270 | $ | 760 | ||||
|
|
|
| |||||
As of December 31, 2021 | As of December 31, 2020 | |||||||
Balance, beginning of period | $ | 1,270 | $ | 760 | ||||
Increase (decrease) in provision | 1,726 | 582 | ||||||
Write-offs, net of recoveries | (1,672 | ) | (122 | ) | ||||
Foreign currency translation adjustments | (12 | ) | 50 | |||||
Balance, end of period | $ | 1,312 | $ | 1,270 | ||||
|
| Successor | ||||||||
| As of December 31, 2020 | As of December 31, 2019 | |||||||
Buildings | $ | 2,434 | $ | 2,342 | ||||
IT equipment | 9,695 | 8,264 | ||||||
Furniture and fixtures | 1,700 | 1,397 | ||||||
Other equipment | 38 | 35 | ||||||
|
|
|
| |||||
Total property and equipment | $ | 13,867 | $ | 12,038 | ||||
|
|
|
| |||||
Less: accumulated depreciation | 8,865 | 7,156 | ||||||
|
|
|
| |||||
Property and equipment, net | $ | 5,002 | $ | 4,882 | ||||
|
|
|
| |||||
As of December 31, | As of December 31, | |||||||
2021 | 2020 | |||||||
Buildings | $ | 2,451 | $ | 2,434 | ||||
IT Equipment | 20,571 | 9,695 | ||||||
Furniture and fixtures | 1,821 | 1,700 | ||||||
Other equipment | 38 | 38 | ||||||
Total property and equipment | $ | 24,881 | $ | 13,867 | ||||
Less: accumulated depreciation | 10,436 | 8,865 | ||||||
Property and equipment, net | $ | 14,445 | $ | 5,002 | ||||
|
Balance as of December 31, 2018 (Successor) | $ | 182,994 | ||
Goodwill acquired | 2,569 | |||
Foreign currency translation adjustments | 7,417 | |||
|
| |||
Balance as of December 31, 2019 (Successor) | $ | 192,980 | ||
Goodwill acquired | 2,211 | |||
Foreign currency translation adjustments | 5,433 | |||
|
| |||
Balance as of December 31, 2020 (Successor) | $ | 200,624 | ||
|
|
Balance as of December 31, 2019 | $ | 192,980 | ||
Goodwill acquired | 2,211 | |||
Effect of currency translation remeasurement | 5,433 | |||
Balance as of December 31, 2020 | $ | 200,624 | ||
Goodwill acquired (1) | 152,421 | |||
Effect of currency translation remeasurement | (6,627 | ) | ||
Balance as of December 31, 2021 | $ | 346,418 | ||
(1) | Includes a working capital adjustment of $1.1 million in the fourth quarter of fiscal year 2021 for the Second Spectrum acquisition |
No
|
Weighted Average Remaining Useful Lives | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||
(years) | ||||||||||||||
Data rights | 7 | $ | 71,266 | $ | 23,625 | $ | 47,641 | |||||||
Marketing products | 6 | 62,803 | 12,786 | 50,017 | ||||||||||
Technology | 2 | 112,698 | 54,811 | 57,887 | ||||||||||
Capitalized software | 2 | 70,494 | 34,820 | 35,674 | ||||||||||
Total intangible assets | $ | 317,261 | $ | 126,042 | $ | 191,219 | ||||||||
| Weighted Average Remaining Useful Lives | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||
| (years) | (in thousands) | |||||||||||||
Data rights | 8 | $ | 71,797 | $ | 16,621 | $ | 55,176 | |||||||
Marketing products | 12 | 24,757 | 4,548 | 20,209 | ||||||||||
Technology | 1 | 44,720 | 32,625 | 12,095 | ||||||||||
Capitalized software | 2 | 44,374 | 17,312 | 27,062 | ||||||||||
|
|
|
|
|
| |||||||||
Total intangible assets | $ | 185,648 | $ | 71,106 | $ | 114,542 | ||||||||
|
|
|
|
|
| |||||||||
Intangible assets subject to amortization as
Weighted Average Remaining Useful Lives | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||
(years) | (in thousands) | |||||||||||||
Data rights | 8 | $ | 71,797 | $ | 16,621 | $ | 55,176 | |||||||
Marketing products | 12 | 24,757 | 4,548 | 20,209 | ||||||||||
Technology | 1 | 44,720 | 32,625 | 12,095 | ||||||||||
Capitalized software | 2 | 44,374 | 17,312 | 27,062 | ||||||||||
Total intangible assets | $ | 185,648 | $ | 71,106 | $ | 114,542 | ||||||||
| Fiscal Years | (in thousands) | |||
2021 | $ | 34,345 | ||
2022 | 19,633 | |||
2023 | 12,206 | |||
2024 | 8,703 | |||
2025 | 8,703 | |||
Thereafter | 30,952 | |||
|
| |||
Total | $ | 114,542 | ||
|
| |||
Fiscal Years | (in thousands) | |||
2022 | $ | 62,929 | ||
2023 | 55,558 | |||
2024 | 27,112 | |||
2025 | 8,859 | |||
2026 | 8,859 | |||
Thereafter | 27,902 | |||
Total | $ | 191,219 | ||
Note | 9. Other Assets |
| Successor | ||||||||
| As of December 31, 2020 | As of December 31, 2019 | |||||||
Other current assets: | ||||||||
Non-trade receivables | $ | 3,448 | $ | 2,995 | ||||
Deferred offering costs | 2,093 | — | ||||||
Executive notes receivable (1) | 4,659 | — | ||||||
Inventory | 384 | 281 | ||||||
|
|
|
| |||||
Total other current assets | $ | 10,584 | $ | 3,276 | ||||
|
|
|
| |||||
Other assets: | ||||||||
Executive notes receivable (1) | $ | — | 4,452 | |||||
Security deposit | 3,622 | 3,457 | ||||||
Corporate tax receivable | 1,256 | 1,985 | ||||||
Sales tax receivable | 3,042 | 846 | ||||||
Contract costs | 1,576 | 1,340 | ||||||
|
|
|
| |||||
Total other assets | $ | 9,496 | $ | 12,080 | ||||
|
|
|
| |||||
December 31, 2021 | December 31, 2020 | |||||||
| Other current assets: | ||||||||
Non-trade receivables | $ | 6,767 | $ | 3,448 | ||||
Deferred offering costs | — | 2,093 | ||||||
Executive note receivable | — | 4,659 | ||||||
Inventory | 530 | 384 | ||||||
Total other current assets | $ | 7,297 | $ | 10,584 | ||||
Other assets: | ||||||||
Security deposit | $ | 4,059 | $ | 3,622 | ||||
Corporate tax receivable | 3,886 | 1,256 | ||||||
Sales tax receivable | �� | 623 | 3,042 | |||||
Contract costs | 1,751 | 1,576 | ||||||
Total other assets | $ | 10,319 | $ | 9,496 | ||||
Note |
10. Debt |
|
| Successor | ||||||||||||||||||||
Instrument | Date of Issuance | Maturity Date | Effective interest rate | December 31, 2020 | December 31, 2019 | |||||||||||||||
Investor Loan Notes | | September 2018 to December 2019 | | | September 2028 to December 2029 | | 10 | % | $ | 82,631 | $ | 73,061 | ||||||||
Data Project Srl Mortgage | December 2010 | December 2025 | 8 | % | 116 | 130 | ||||||||||||||
Related Party Loan | December 2020 | May 2021 | 4 | % | 10,248 | — | ||||||||||||||
|
|
|
| |||||||||||||||||
| $ | 92,995 | $ | 73,191 | |||||||||||||||||
Less current portion of debt |
| (10,272 | ) | (25 | ) | |||||||||||||||
|
|
|
| |||||||||||||||||
Noncurrent portion of debt |
| $ | 82,723 | $ | 73,166 | |||||||||||||||
|
|
|
| |||||||||||||||||
Instrument | Date of Issuance | Maturity Date | Effective interest rate | December 31, 2021 | December 31, 2020 | |||||||||||
Investor Loan Notes | September 2018 to December 2019 | April 2021 | 10% | $ | — | $ | 82,631 | |||||||||
Genius Sports Italy Srl Mortgage | December 2010 | December 2025 | 1% | 88 | 116 | |||||||||||
Related party loan | December 2020 | April 2021 | 4% | — | 10,248 | |||||||||||
| $ | 88 | $ | 92,995 | |||||||||||||
Less current portion of debt | (23 | ) | (10,272 | ) | ||||||||||||
Non-current portion of debt | $ | 65 | $ | 82,723 | ||||||||||||
Data ProjectNotes in full upon the consummation of the Merger.
Predecessor Loan Notes
From July 2015 through August 2017, Genius Sports issued in four separate tranches an aggregate of $20.3 million in loan notes (“Loan Notes”) to certain lenders. The Series A and B Loan Notes (collectively the “2015 Loan Notes”) accrue 3% interest payable in cash and 3% interest paid in-kind and the Series D and E Loan Notes (collectively the “2017 Loan Notes”) bear interest at 5% per annum. Genius Sports paid $0.6 million in total upfront fees to the lenders for the various Loan Note issuances and $0.2 million in third party fees incurred to issue the Loan Notes, each presented as a discount on the Loan Note carrying value. Additional discount on the 2017 Loan Notes resulted from $3.5 million of allocated proceeds to the Genius Sports’ Common A Shares issued in conjunction with the 2017 Notes. The Loan Notes include standard financial and non-financial covenants and had an original maturity date of July 27, 2021.
Certain identified embedded contingent redemption features in the Loan Notes were concluded to require bifurcation and separate accounting as derivative instruments at fair value from the Loan Notes. The fair value of the bifurcated derivative, which were net derivative liabilities, totaled $4.3 million as of January 1, 2018. The net change in the fair values of the derivatives resulted in a loss of $3.1 million for the period from January 1, 2018 through September 7, 2018 (Predecessor) and was included in the consolidated statements of operations.
In connection with the Apax Funds Investment on September 7, 2018, the Loan Notes were repaid in full pursuant to the contractual terms. On this date, the Company treated the Loan Note settlement as an extinguishment by derecognizing the Loan Notes, deferred financing costs, accrued interest, and the bifurcated derivative in full. As the Loan Notes were settled in the Genius Sports acquisition, they are only reflected in the Predecessor period and are not outstanding during any presented Successor period.
Other Predecessor Loans
In addition to the above Loan Notes, Genius Sports also had outstanding loans of approximately $12.4 million to various thirdparty lenders and related parties. In connection with the Apax Funds Investment on September 7, 2018, the Company repaid the entire outstanding balance of the loans.
| Fiscal Years: | (in thousands) | |||
2021 | $ | 10,272 | ||
2022 | 24 | |||
2023 | 25 | |||
2024 | 25 | |||
2025 | 23 | |||
Thereafter | 82,626 | |||
|
| |||
Total payment outstanding | $ | 92,995 | ||
|
| |||
Fiscal Period: | (in thousands) | |||
| 2022 | $ | 23 | ||
2023 | 22 | |||
2024 | 23 | |||
2025 | 20 | |||
2026 | 0— | |||
Thereafter | 0— | |||
Total payment outstanding | $ | 88 | ||
|
| Successor | ||||||||
| As of December 31, 2020 | As of December 31, 2019 | |||||||
Other current liabilities: | ||||||||
Other payables | $ | 3,576 | $ | 3,461 | ||||
Contingent consideration | 138 | — | ||||||
|
|
|
| |||||
Total other current liabilities | $ | 3,714 | $ | 3,461 | ||||
|
|
|
| |||||
Other liabilities: | ||||||||
Contingent consideration | $ | 2,164 | $ | 2,520 | ||||
Deposits on Incentive Securities | 1,425 | 1,290 | ||||||
|
|
|
| |||||
Total other liabilities | $ | 3,589 | $ | 3,810 | ||||
|
|
|
| |||||
|
In connection with the issuance of the 2015 Loan Notes, Genius Sports issued the lenders Warrants to purchase 218,852 common shares at any time prior to the expiration of the Warrants. The Warrants have an exercise price of $0.0001 per share and provide for certain adjustments to the number of common shares exercisable dependent on realized economics of a sale of Genius Sports. The Warrants are classified as liabilities as the contractual adjustments to the number of common shares underlying the Warrants are not fully indexed to Genius Sports’ own equity. The Warrants had a fair value of $5.0 million as of January 1, 2018 and were subsequently remeasured on September 7, 2018 in connection with the Genius Sports acquisition, when the Warrants were exercised for 136,707 common shares pursuant to contractual terms. The change in fair value of $4.1 million was recorded in the consolidated statement of operations in the predecessor period. As the Warrants have an exercise price of $0.0001 per share, the fair value of the Warrants is estimated as the fair value of the underlying common shares as of the acquisition date.
|
On September 7, 2018, the Company entered into investment deeds in connection with the Apax Funds Investment (refer to
December 31, 2021 | December 31, 2020 | |||||||
Other current liabilities: | ||||||||
Other payables | $ | 2,839 | $ | 3,576 | ||||
Deferred consideration | 5,675 | — | ||||||
Contingent consideration | 21,840 | 138 | ||||||
Total other current liabilities | $ | 30,354 | $ | 3,714 | ||||
Other liabilities: | ||||||||
Deferred consideration | $ | 4,595 | $ | — | ||||
Contingent consideration | 6,532 | 2,164 | ||||||
Incentive securities | — | 1,425 | ||||||
Total other liabilities | $ | 11,127 | $ | 3,589 | ||||
As of December 31, 2020 and 2019 (Successor). the Company had 218,561,319 Preference Shares issued and outstanding. The Company has classified the Preference Shares as temporary equity in the consolidated balance sheets and remeasures each reporting period to the liquidation preference as described below.
Dividends
The Preference Shares receive a fixed cumulative dividend at a rate per annum equal to 10% of the original issue price (the “Preference Dividend”).
Redemption
The Company may, with the prior consent of the Board of Directors, redeem or repurchase some or all of the Preference Shares at any time at a price equal to the aggregate sum of: (i) the issuance price of the Preference Shares, plus (ii) all accrued but unpaid Preference Dividend, less (iii) the amount of all prior distributions made on the relevant Preference Shares.
As a result of the Apax Funds Investment, Apax holds a majority voting interest in the Company and controls the Board of Directors as of December 31, 2020 and 2019 (Successor). Therefore, the Company’s option to redeem the Preference Shares is deemed to not be solely within the control of the Company as Apax has the ability to force the Company to redeem the Preference Shares. As a result, the Preference Shares are classified in temporary equity, remeasured at each reporting date at the redemption amount, with any increase in carrying value recorded as a dividend.
Liquidation
Holders of Preference Shares are entitled to receive a liquidation preference equal to the Preference Dividends and issuance price prior to any distribution to holders of common shares in any liquidity event, inclusive of a listing, exit, refinancing, or disposal of assets. Dividends on Preference Shares were $31.9 million, $28.3 million and $8.8 million for the years ended December 31, 2020 and 2019 (Successor), and the period from September 8, 2018 through December 31, 2018 (Successor), respectively.
Voting Rights
The Preference Shares are not entitled to receive notice of, attend orand speak at a general meetingsmeeting of the Company orand to vote on resolutions.
|
Predecessorresolutions on a one vote per ordinary share basis, exercised by a show of hands, on a poll or on a written resolution. The holders of ordinary shares are entitled to such dividends as may be declared by the Genius Board, subject to all applicable laws, including but not limited to the Guernsey Companies Law and the Genius Governing Documents. Dividends and other distributions authorized by the Genius Board in respect of the issued and outstanding ordinary shares shall be paid in accordance with the Genius Governing Documents and shall be distributed among the holders of ordinary shares on a pro rata basis.
Genius Sports equity structure compromised Ordinary Shares, Ordinary A Shares, authorized and Ordinary S Shares (collectively,193,585,625 shares issued and outstanding. As of December 31, 2020, the “Predecessor Common Shares”), each with a par value of $0.0001, except for the Ordinary S Shares, whichCompany had a par value of $0.000001. At close of the acquisition of Genius Sports, described in Note 2 – Business Combinations, all Predecessor70,040,242 Common Shares authorized, issued and Warrants, described in Note 11 – Warrants, were retired.
Genius Sports equity structure also included certain Staff Loans, defined in Note 15 – Stock-based Compensation. These Staff Loans consisted of additional classes of Predecessor Commonoutstanding.
Successor Common Shares
The Company’s equity structure following the Apax Funds Investment on September 7, 2018 consisted of the following: A1 Ordinary Shares, A2 Ordinary Shares, and A3 Ordinary Shares (collectively, Common Shares), with each share having a nominal value of $0.01.
Other than the different notice, attendance, and voting rights as outlined above, the A1 Ordinary Shares, A2 Ordinary Shares and A3 Ordinary Shares have the same rights, including entitlement to receive distributions and liquidation proceeds. The holders have no preemptive orany other subscription rights and there is no redemption or sinking fund provisions with respect to such shares. In the event of liquidation, dissolution, distribution of assets, or winding up of the Company, the holders of Common Shares have equal rights to receive all the assets of the Company afterwhether on a winding up or otherwise.
authorized and 18,500,000 B Shares issued and outstanding. As of December 31, 2020, and 2019 (Successor), the Company had 1,873,423 Common0 B Shares authorized, and 1,873,423 shares issued and outstanding.
The Company’s directors may exercise the power of the Company to issue an unlimited number of shares of different types or classes.
The Company’s equity structure also included certain Incentive Securities, defined in
|
14. Loss Per Share
Additionally, the B Shares, issued in connection with the License Agreement (defined below), are not included in the loss per share calculations below as they are
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||
Net loss attributable to common shareholders - Basic and Diluted | $ | (30,348 | ) | $ | (40,207 | ) | $ | (9,761 | ) | $ | (15,527 | ) | ||||
Basic and diluted weighted average common shares outstanding | 1,873,423 | 1,829,947 | 1,812,601 | 2,983,170 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net loss per share attributable to common shareholders: Basic and diluted | $ | (16.20 | ) | $ | (21.97 | ) | $ | (5.38 | ) | $ | (5.20 | ) | ||||
|
|
|
|
|
|
|
| |||||||||
Year ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Net loss attributable to common stockholders – basic and diluted | $ | (592,753 | ) | $ | (30,348 | ) | $ | (40,207 | ) | |||
Basic and diluted weighted average common stock outstanding | 150,912,333 | 70,040,242 | 68,414,830 | |||||||||
Loss per share attributable to common stockholders – basic and diluted | $ | (3.93 | ) | �� | $ | (0.43 | ) | $ | (0.59 | ) | ||
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||
Share Options | — | — | — | 851,116 | ||||||||||||
Staff Loans | — | — | — | 602,861 | ||||||||||||
Preference Shares | 218,561,319 | 218,561,319 | 213,657,244 | — | ||||||||||||
Incentive Securities | 833,694 | 761,394 | 709,783 | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | 219,395,013 | 219,322,713 | 214,367,027 | 1,453,977 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Year ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Stock options to purchase common stock | 436,238 | — | — | |||||||||
Unvested restricted shares | 8,889,155 | — | — | |||||||||
Public Warrants to purchase common stock | 7,668,381 | — | — | |||||||||
Warrants issued to NFL to purchase common stock | 18,500,000 | — | — | |||||||||
Preference shares | — | 218,561,319 | 218,561,319 | |||||||||
Incentive Securities | — | 31,168,684 | 28,465,659 | |||||||||
Total | 35,493,774 | 249,730,003 | 247,026,978 | |||||||||
| ||||
Common share and equivalents price - marketable (1) | $ | 10.26 | ||
Discount for lack of marketability (“DLOM”) (2) | 16.0 | % | ||
*Term (3) | 4.5 | years | ||
*Volatility (4) | 83.3 | % | ||
*Risk-free rate (5) | 0.3 | % |
Share
*
Average Grant
Date Fair Value
per Share — 10,995,112 $ 8.70 (5,842 ) $ 8.62 (2,100,115 ) $ 9.76 8,889,155 $ 8.44 Duringpredecessor period, Genius Sports had two share option plans includingMerger, the Genius Sports Enterprise Management IncentiveBoard of Directors adopted the 2021 Option Plan and granted employees options to purchase the Genius Sports Unapproved Share Plan underCompany’s common stock via an employee benefit trust including 1) options which incentive stockshall immediately vest upon Closing (“Immediate-Vesting Options”), 2) options subject only to service conditions (“ShareTime-Vesting Options”) may be grantedand 3) options with service and market conditions (“Performance-Vesting Options”). Immediate-Vesting Options became fully vested and exercisable immediately following the Closing, which aligns with the Grant Date. Time-Vesting Options are subject to employees. On January 1, 2018 total outstanding Sharegraded vesting over the four years following the Grant Date. Performance-Vesting Options were 861,116 withare subject to graded vesting over the three years from the Grant Date, subject to a market condition related to volume weighted average exercisetrading price in USDperformance of $2.16. Substantially allthe Company’s common stock.Share Options werethe Company’s options under the 2021 Option Plan was calculated using a combination of the Black Scholes Option Pricing Model and Monte Carlo simulations based on the following assumptions: 5.0 years $ 16.21 90.1 % 0.8 % $ 10.00 0.0 %
Number of Options | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life | Aggregate Intrinsic Value | |||||||||||||
(in years) | (in thousands) | |||||||||||||||
Outstanding as of December 31, 2020 | — | |||||||||||||||
Granted | 445,868 | $ | 10.00 | |||||||||||||
Forfeited | (9,630 | ) | $ | 10.00 | ||||||||||||
Outstanding as of December 31, 2021 | 436,238 | $ | 10.00 | 4.30 | $ | 0— | ||||||||||
Exercisable as of December 31, 2021 | 58,053 | |||||||||||||||
Unvested as of December 31, 2021 | 378,185 | |||||||||||||||
In connectionredeemable B Share with the Apax Funds Investment, on September 7, 2018, all outstanding Share Options of 851,116 were exercised and settled. The Share Options had a weighted average exercise price of $2.04 with a total intrinsic value of $52.5 million paid to the holders.
No compensation cost for Share Options was recognized in the period from January 1, 2018 through September 7, 2018 (Predecessor) due to amounts involved being immaterial.
Staff Loans
During the predecessor period, Genius Sports issued promissory notes to employees in the aggregated amounts of $2.9 million to purchase 602,861 Predecessor Common Shares in Genius Sports, which includes Ordinary Shares, G Ordinary Shares and F Ordinary Shares (collectively, the “Staff Loans”), with each share having a par value of $0.0001. The promissory notesB Shares, which are collateralizednot separable from the warrants, are voting only byshares with no economic rights to dividends or distributions. Pursuant to the sharesLicense Agreement, when the warrants are exercised, the Company shall purchase or, at its discretion, redeem at the par value an equivalent number of B Shares, and any such purchased or redeemed B Shares shall thereafter be cancelled.
Number of Warrants | Weighted Averaged Exercise Price | |||||||
Outstanding as of December 31, 2020 | 0 — | |||||||
Issued | 18,500,000 | $ | 0.01 | |||||
Outstanding as of December 31, 2021 | 18,500,000 | |||||||
year ended December 31, 2021.
The
$0.21. In connection with the Merger, any Incentive Securities that remained unvested immediately prior to the Closing were exchanged for restricted shares issued under the 2021 Restricted Share Plan (discussed above in “2021 Restricted Shares Plan” section).
2020.
Awards Outstanding | Weighted Averaged Exercise Price | Aggregate Intrinsic Value | ||||||||||
(in thousands) | ||||||||||||
Unvested awards December 31, 2020 | 31,168,684 | $ | 1.60 | $ | 16,243 | |||||||
Converted | (31,168,684 | ) | $ | 1.39 | ||||||||
Outstanding as of December 31, 2021 | 0— | $ | — | |||||||||
Year Ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Cost of revenue | $ | 243,512 | $ | 0— | $ | 0 — | ||||||
Sales and marketing | 3,546 | 0— | 0 — | |||||||||
Research and development | 4,670 | 0— | 0 — | |||||||||
General and administrative | 237,746 | 0— | 0 — | |||||||||
Total | $ | 489,474 | $ | 0— | $ | 0 — | ||||||
| Successor | ||||||
| December 31, 2020 | December 31, 2019 | December 31, 2018 | ||||
Expected term (years) (1) | 4.5 | 4.5 | 4.5 | |||
Current stock value | $7.41 - $15.19 | $7.35 - $15.06 | $7.37 - $26.58 | |||
Expected volatility (2) | 30% | 30% | 30% | |||
Risk-free rate (3) | 0.3% - 1.63% | 1.7% - 2.48% | 2.80% | |||
Dividend yield (4) | 0% | 0% | 0% | |||
listed market price of such warrants. |
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Given the absence of a public trading market, the Board of Directors considered numerous objective and subjective factors to determine the fair value of the Private Placement Warrants using a Black Scholes Pricing Model. Inherent in a Black Scholes Pricing Model are assumptions related to expected stock-price volatility, expected life, risk-free interest rate and dividend yield. The Company estimates the volatility of its common stock warrants based on implied volatility from the Company’s traded warrants and from historical volatility of select peer company’s common stock that matches the expected remaining life of the warrants. The risk-free interest rate is based on the U.S. Treasury
Description | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Liabilities: | ||||||||||||||||
Public Warrants | $ | 16,794 | $ | — | $ | — | $ | 16,794 | ||||||||
Contingent Consideration | — | 20,532 | 7,840 | 28,372 | ||||||||||||
Total liabilities | $ | 16,794 | $ | 20,532 | $ | 7,840 | $ | 45,166 | ||||||||
As of September 15, 2021 | As of April 20, 2021 | |||||||
Exercise price | $ | 11.50 | $ | 11.50 | ||||
Stock price | $ | 20.05 | $ | 16.21 | ||||
Volatility | 65.90 | % | 26.60 | % | ||||
Term | 4.60 | years | 5.00 | years | ||||
Risk-free rate | 0.73 | % | 0.82 | % | ||||
Dividend yield | 0.00 | % | 0.00 | % | ||||
Public Warrants | Private Placement Warrants | Total | ||||||||||
Initial measurement at April 20, 2021 | $ | 52,638 | $ | 32,026 | $ | 84,664 | ||||||
Change in fair value | (22,733 | ) | 34,145 | 11,412 | ||||||||
Exercise of warrants | (12,928 | ) | (65,876 | ) | (78,804 | ) | ||||||
Foreign currency translation adjustments | (183 | ) | (295 | ) | (478 | ) | ||||||
Derivative warrant liabilities at December 31, 2021 | $ | 16,794 | $ | 0 | $ | 16,794 | ||||||
2021 | 2020 | |||||||
Beginning balance – January 1 | $ | 2,302 | $ | 2,520 | ||||
Additions (1) | 6,615 | 0 | ||||||
(Gain) loss on fair value remeasurement of contingent consideration (2) | 19,405 | (271 | ) | |||||
Foreign currency translation adjustments | 50 | 53 | ||||||
Ending balance – December 31 | $ | 28,372 | $ | 2,302 | ||||
(1) | Additions during the year ended December 31, 2021 represent contingent consideration liabilities arising from the Spirable acquisition (refer to Note 3 – Business Combinations ) in the third quarter of 2021. |
(2) | (Gain) loss on fair value remeasurement of contingent consideration mainly consist of an increase in the obligation to the former management shareholders of Second Spectrum as the lock-up period expired on December 31, 2021. Pursuant to the terms and conditions of the business combination agreement with Second Spectrum, the Company will issue an additional 2,701,576 shares of the Company’s common stock to the former Second Spectrum shareholders in early 2022. |
A summary of the Incentive Security activityMonte Carlo simulation for the years ended December 31, 2020 and 2019 (Successor), and the period from September 8, 2018 through December 31, 2018 (Successor) is as follows:
| Awards Outstanding | Weighted Averaged Exercise Price | Aggregate Intrinsic Value (in thousands) | ||||||||||
Outstanding as of September 7, 2018 (Successor) | — | $ | — | $ | — | |||||||
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Granted | 709,783 | $ | 1.66 | |||||||||
Forfeited | — | |||||||||||
Expired | — | |||||||||||
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Outstanding as of December 31, 2018 (Successor) | 709,783 | $ | 1.66 | $ | 14,857 | |||||||
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Granted | 52,581 | $ | 1.27 | |||||||||
Forfeited | (970 | ) | $ | 1.28 | ||||||||
Expired | — | |||||||||||
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Non-vested awards at December 31, 2019 (Successor) | 761,394 | $ | 1.63 | $ | 15,411 | |||||||
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Granted | 73,270 | $ | 1.28 | |||||||||
Forfeited | (970 | ) | $ | 1.28 | ||||||||
Expired | — | |||||||||||
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Non-vested awards at December 31, 2020 (Successor) | 833,694 | $ | 1.60 | $ | 16,243 | |||||||
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The awards have been treated as early exercised options from an accounting perspective.
The weighted-average grant date fair value of the Incentive Securities granted during the year ended December 31, 2020 and 2019 (Successor), and the period from September 8, 2018 through December 31, 2018 (Successor) was $13.37, $12.95 and $22.59 per share, respectively.
As of December 31, 2020 (Successor),2021, the Company had $16.2 million0 transfers between levels of unrecognized stock-based compensation expense related to the Incentive Securities. As noted previously, the Company does not expect to recognize any cost related to the Incentive Securities.
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fair value hierarchy of its assets or liabilities measured at fair value.
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||
U.K. | $ | (26,846 | ) | $ | (43,199 | ) | $ | (9,472 | ) | $ | (18,613 | ) | ||||
Foreign | (1,689 | ) | (2,374 | ) | (1,547 | ) | 3,190 | |||||||||
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Loss before income taxes | $ | (28,535 | ) | $ | (45,573 | ) | $ | (11,019 | ) | $ | (15,423 | ) | ||||
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Year Ended December 31, 2021 | Year Ended December 31, 2020 | Year Ended December 31, 2019 | ||||||||||
U.K. | $ | (326,206 | ) | $ | (26,846 | ) | $ | (43,199 | ) | |||
Foreign | (278,248 | ) | (1,689 | ) | (2,374 | ) | ||||||
Loss before income taxes | $ | (604,454 | ) | $ | (28,535 | ) | $ | (45,573 | ) | |||
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||
Current: | ||||||||||||||||
U.K. | $ | — | $ | — | $ | — | $ | — | ||||||||
Foreign | 47 | 114 | (126 | ) | 696 | |||||||||||
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Current tax expense | 47 | 114 | (126 | ) | 696 | |||||||||||
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Deferred: | ||||||||||||||||
U.K. | 1,650 | (5,374 | ) | (1,171 | ) | (649 | ) | |||||||||
Foreign | 116 | (106 | ) | 39 | 57 | |||||||||||
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Deferred tax expense (benefit) | 1,766 | (5,480 | ) | (1,132 | ) | (592 | ) | |||||||||
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Total | $ | 1,813 | $ | (5,366 | ) | $ | (1,258 | ) | $ | 104 | ||||||
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Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | ||||||||||
2021 | 2020 | 2019 | ||||||||||
Current: | ||||||||||||
U.K. | $ | 0 | $ | 0 | $ | 0 | ||||||
Foreign | 1,708 | 47 | 114 | |||||||||
Current tax expense | 1,708 | 47 | 114 | |||||||||
Deferred: | ||||||||||||
U.K. | (13,618 | ) | 1,650 | (5,374 | ) | |||||||
Foreign | 209 | 116 | (106 | ) | ||||||||
Deferred tax expense (benefit) | (13,409 | ) | 1,766 | (5,480 | ) | |||||||
Total | $ | (11,701 | ) | $ | 1,813 | $ | (5,366 | ) | ||||
| Successor | Predecessor | |||||||||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | Period from September 8, 2018 through December 31, 2018 | Period from January 1, 2018 through September 7, 2018 | |||||||||||||
U.K. provision at statutory rate | 19.0 | % | 19.0 | % | 19.0 | % | 19.0 | % | ||||||||
Expenses not deductible for tax purposes | 0.9 | (3.6 | ) | (2.2 | ) | (1.4 | ) | |||||||||
Goodwill writeback | — | — | (1.6 | ) | 1.4 | |||||||||||
Non-deductible interest expense | (3.6 | ) | — | (3.4 | ) | — | ||||||||||
Income not taxable | — | 0.8 | 1.3 | 4.3 | ||||||||||||
Stock based compensation | �� | 2.6 | 1.5 | — | 47.4 | |||||||||||
Chargeable gains/(losses) | — | — | 0.1 | (2.0 | ) | |||||||||||
Remeasurement of warrant Liability | — | — | — | (8.9 | ) | |||||||||||
Transaction cost adjustment | (1.4 | ) | — | — | (7.0 | ) | ||||||||||
Leasing | — | (0.4 | ) | — | — | |||||||||||
Foreign rate difference | — | (1.5 | ) | 0.3 | (5.6 | ) | ||||||||||
Change in valuation allowance | (21.6 | ) | (4.0 | ) | (2.2 | ) | (47.9 | ) | ||||||||
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Effective tax rate | (4.1 | )% | 11.8 | % | 11.3 | % | (0.7 | )% | ||||||||
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Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | ||||||||||
2021 | 2020 | 2019 | ||||||||||
U.K. provision at statutory rate | 19.0 | % | 19.0 | % | 19.0 | % | ||||||
Expenses not deductible for tax purposes | (1.6 | ) | 0.9 | (3.6 | ) | |||||||
Return to provision | (0.4 | ) | 0 | 0 | ||||||||
Non-deductible interest expense | 0 | (3.6 | ) | 0 | ||||||||
Income not taxable | 0 | 0 | 0.8 | |||||||||
Stock based compensation | (19.7 | ) | 2.6 | 1.5 | ||||||||
Chargeable gains/(losses) | 0 | 0 | 0 | |||||||||
Remeasurement of warrant liability | 0 | 0 | 0 | |||||||||
Transaction cost adjustment | 0 | (1.4 | ) | 0 | ||||||||
Tax rate change | 0.3 | 0 | (0.4 | ) | ||||||||
Foreign rate difference | 5.3 | 0 | (1.5 | ) | ||||||||
Change in valuation allowance | (0.9 | ) | (21.6 | ) | (4.0 | ) | ||||||
Effective tax rate | 2.0 | % | (4.1 | )% | 11.8 | % | ||||||
| Successor | ||||||||
| Year Ended December 31, 2020 | Year Ended December 31, 2019 | |||||||
Deferred tax assets: | ||||||||
Net operating loss carry forward | $ | 26,498 | $ | 20,474 | ||||
Property and equipment | 159 | 136 | ||||||
Other | 187 | 156 | ||||||
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Deferred tax assets before valuation allowance | 26,844 | 20,766 | ||||||
Valuation allowance | (11,240 | ) | (3,427 | ) | ||||
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Deferred tax assets, net of valuation allowance | 15,604 | 17,339 | ||||||
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Deferred tax liabilities: | ||||||||
Outside basis difference | 1,913 | 1,855 | ||||||
Intangible assets | 21,783 | 21,534 | ||||||
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Deferred tax liabilities | 23,696 | 23,389 | ||||||
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Net deferred tax assets (liabilities) | $ | (8,092 | ) | $ | (6,050 | ) | ||
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Year Ended December 31, | Year Ended December 31, | |||||||
2021 | 2020 | |||||||
Deferred tax assets: | ||||||||
Net operating loss carry forward | $ | 48,031 | $ | 26,498 | ||||
Property and equipment | (78 | ) | 159 | |||||
Other | 180 | 187 | ||||||
Deferred tax assets before valuation allowance | 48,133 | 26,844 | ||||||
Valuation allowance | (19,059 | ) | (11,240 | ) | ||||
Deferred tax assets, net of valuation allowance | 29,074 | 15,604 | ||||||
Deferred tax liabilities: | ||||||||
Outside basis difference | 2,034 | 1,913 | ||||||
Intangible assets | 43,942 | 21,783 | ||||||
Deferred tax liabilities | 45,976 | 23,696 | ||||||
Net deferred tax assets (liabilities) | $ | (16,902 | ) | $ | (8,092 | ) | ||
2020.
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| Years Ended December 31 | (in thousands) | |||
2021 | $ | 5,209 | ||
2022 | 5,189 | |||
2023 | 4,733 | |||
2024 | 4,106 | |||
2025 | 1,163 | |||
Thereafter | — | |||
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Total | $ | 20,400 | ||
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Years Ended December 31 | (in thousands) | |||
2022 | $ | 6,870 | ||
2023 | 5,757 | |||
2024 | 4,466 | |||
2025 | 1,366 | |||
2026 | 0 | |||
Thereafter | 0 | |||
Total | $ | 18,459 | ||
| Years Ended December 31 | (in thousands) | |||
2021 | $ | 35,414 | ||
2022 | 34,065 | |||
2023 | 34,754 | |||
2024 | 23,640 | |||
2025 | 2,394 | |||
Thereafter | 6,969 | |||
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Total | $ | 137,236 | ||
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Years Ended December 31 | (in thousands) | |||
2022 | $ | 113,218 | ||
2023 | 133,439 | |||
2024 | 124,876 | |||
2025 | 38,050 | |||
2026 | 14,464 | |||
Thereafter | 27,901 | |||
Total | $ | 451,948 | ||
within one year and the remaining due by 2025.
2021.
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receivable carried a 2.5% annual interest rate and was a full-recourse loan. As of December 31, 2020, the outstanding balance on the loan receivable, inclusive of interest, was $4.7 million. On April 20, 2021 upon the successful consummation of the Merger the Company made a
On December 8, 2020, certain investment funds affiliated with Apax entered into a Related Party Loan agreement with a subsidiary of the Company. The Company repaid the investor loan notes and the Related Party Loan in full upon the consummation of the Merger. See Note 910 –
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NFL License Agreement
dMY Technology Group, Inc. II Merger
On October 27, 2020, dMY Technology Group, Inc. II (“dMY”) (NYSE: DMYD), a special purpose acquisition company sponsored by dMY Sponsor II, LLC, entered into a definitive business combination agreement pursuant to which the Company and dMY II will merge (the “Transaction”). On April 16, 2021, at a special meeting of stockholders, dMY stockholders approved the proposed Transaction. The Transaction was consummated on April 20, 2021. As a result of the Transaction, shareholders of the Company and dMY exchanged their shares for shares in a new combined company, Genius Sports Limited, which became publicly listed on the New York Stock Exchange.
F-26