Investments

12 Months Ended

Dec. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Investments

Investments.  The Company’s investments at December 31, 2015 and 2014 consist primarily of investments in SaleMove, AutoWeb and GoMoto and are recorded at cost.  Although there is no established market for these investments, the Company evaluated the investments for impairment by comparing them to an estimated fair value and determined that no impairment existed.  To determine the estimated fair value for the investment in SaleMove, the Company analyzed the discounted future cash flows of Autobytel’s sales of SaleMove products.  To determine the estimated fair value for the investment in AutoWeb, the Company analyzed participants in the Series B round of financing in November 2014.  These fair value measurements are based on significant inputs not observable in the market and represent a Level 3 measurement.

The following table presents the Company’s activity for 2015:

		Note	Note
		receivable-	receivable-
Description		long-term	current			Investments
	(in thousands)
Balance at December 31, 2014	$	—	$	150		$	3,880
Total gains or (losses) (realized or unrealized)		—		—			636
Purchases		375		—			—
Sales		—		—			—
Transfers		—		(150	)		(3,836	)
Balance at December 31, 2015	$	375	$	—		$	680

In September 2013 the Company entered into a Contribution Agreement with AutoWeb pursuant to which Autobytel contributed to AutoWeb $2.5 million and assigned to AutoWeb all the ownership interests in the autoweb.com domain name and two registered trademarks related to the AutoWeb name and related goodwill in exchange for 8,000 shares of AutoWeb Series A Preferred Stock, $0.01 par value per share.  The 8,000 shares of AutoWeb Series A Preferred Stock represented 16% of all issued and outstanding common stock of AutoWeb as of September 18, 2013, assuming conversion of the Series A Preferred Stock into AutoWeb common stock as of September 18, 2013. The Company also obtained an option to acquire an additional 5,000 shares of AutoWeb Series A Preferred Stock at a per share exercise price of $500.00. In connection with this investment, the Company also entered into arrangements with AutoWeb to use the AutoWeb pay-per-click, auction-driven automotive marketplace technology platform as both a publisher and as an advertiser. In November 2014 we entered into a Series B Preferred Stock Purchase Agreement with AutoWeb pursuant to which the Company paid $880,394 in exchange for 1,076 shares of AutoWeb Series B Preferred Stock, $0.01 par value per share.  The investments in AutoWeb were recorded at cost because prior to the AutoWeb Merger Date, the Company did not have significant influence over AutoWeb. On the AutoWeb Merger Date, the shares of AutoWeb Series A Preferred Stock, AutoWeb Series B Preferred Stock, and the option to acquire an additional 5,000 shares of AutoWeb Series A Preferred Stock were cancelled. See Note 3.

In September 2013 the Company entered into a Convertible Note Purchase Agreement in which Autobytel invested $150,000 in SaleMove in the form of a convertible promissory note (“SaleMove Note 1”).  The convertible promissory note accrues interest at an annual rate of 6.0% and is due and payable in full on September 1, 2015 unless converted prior to such maturity date. The convertible note will be converted into preferred stock of SaleMove in the event of a preferred stock financing by SaleMove of at least $1.0 million prior to the maturity date of the convertible note.

In November 2014 the Company invested an additional $400,000 in SaleMove in the form of a convertible promissory note (“SaleMove Note 2”).  The convertible promissory note accrues interest at an annual rate of 6.0% and is due and payable in full on November 18, 2016 unless converted prior to the maturity date. The convertible note will be converted into preferred stock of SaleMove in the event of a preferred stock financing by SaleMove of at least $1.0 million prior to the maturity date of the convertible note.  SaleMove Note 1 and SaleMove Note 2 were converted into 190,997 Series A Preferred Stock in July 2015 upon a preferred stock financing by SaleMove and is classified as a long-term investment on the consolidated balance sheet as of December 31, 2015.

In December 2014 the Company entered into a Series Seed Preferred Stock Purchase Agreement with GoMoto in which the Company paid $100,000 for 317,460 shares of Series Seed Preferred Stock, $0.001 par value per share.  The $100,000 investment in GoMoto was recorded at cost because the Company does not have significant influence over GoMoto. In October 2015 the Company invested an additional $375,000 in GoMoto in the form of a convertible promissory note (“GoMoto Note”). The convertible promissory note accrues interest at an annual rate of 4.0% and is due and payable in full on or after October 28, 2017 upon demand or at GoMoto’s option ten days’ written notice unless converted prior to the maturity date. The convertible note will be converted into preferred stock of GoMoto in the event of a preferred stock financing by GoMoto of at least $1.0 million prior to the maturity date of the convertible note. The GoMoto Note is classified as an other long-term asset on the consolidated balance sheet as of December 31, 2015.