Note 6 - Commitments and Contingencies

6 Months Ended

Jun. 30, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

Note 6—Commitments and Contingencies

Operating Leases

The Company leases certain fixed assets under capital leases that expire through 2017. The Company leases its operating facilities in the U.S. under certain noncancelable operating leases that expire through 2018. These leases are renewable at the Company’s option. During 2014, the Company leased its operating facility in Sao Paulo, Brazil. The facility was closed on December 31, 2014.

Rent expense under these leases was approximately $507,000 and $546,000 for each of the three months ended June 30, 2015 and 2014, respectively. Rent expense under these leases was approximately $1.1 million for each of the six months ended June 30, 2015 and 2014, respectively.

Capital Leases

In 2012, the Company executed two non-cancelable master lease agreements, one with Dell Financial Services and one with HP Financial Services.  Both are for the purchase or lease of equipment for the Company’s data centers. Principal and interest are payable monthly at interest rates ranging from 4.5% to 8.0% per annum, rates varying based on the type of equipment purchased.  The capital leases are secured by the leased equipment, and outstanding principal and interest are due respectively through August 2017. During 2015, the Company did not enter into any new capital leases.

A summary of minimum future rental payments required under capital and operating leases as of June 30, 2015 are as follows: 

	Capital Leases			Operating Leases
Remaining in 2015	$	345,240		$	823,868
2016		385,503			1,644,774
2017		225,879			1,207,702
2018		-			42,240
Total minimum lease payments	$	956,622		$	3,718,584
Less: Amount representing interest		(43,495	)
Total present value of minimum payments		913,127
Less: Current portion of such obligations		540,235
Long-term capital lease obligations	$	372,892

Litigation

From time to time, we are party to certain legal proceedings that arise in the ordinary course and are incidental to our business. We operate our business online, which is subject to extensive regulation by federal and state governments.

On April 30, 2015, plaintiff F. Stephen Allen served a complaint on the Company that he filed on April 23, 2015 in the United States District Court for the Northern District of Oklahoma accusing the Company of breach of contract for its alleged failure to maintain the effectiveness of a registration statement for warrant shares. The complaint seeks damages of not less than $4 million. The Company believes the plaintiff’s allegations are without merit and intends to defend against them vigorously.

On February 3, 2014, the San Francisco City Attorney filed a complaint against the Company in the Superior Court of the State of California, County of San Francisco, alleging that the Company engages in unfair business practices with respect to its use of information relating to minors, and particularly with respect to location information and the disclosure of such use. The Company believes the City Attorney’s allegations are without merit and intends to defend against them vigorously.

Future events or circumstances, currently unknown to management, will determine whether the resolution of pending or threatened litigation or claims will ultimately have a material effect on our consolidated financial position, liquidity or results of operations in any future reporting periods.