On October 13, 2020, the Company acquired from certain individuals (collectively, the “Sellers”), 51% of the issued and outstanding shares of stock of a company engaged in the sale and marketing of digital advertising that, together with its subsidiaries, does business under the name Cisneros Interactive (“Cisneros Interactive”). The acquisition, funded from cash on hand, included a purchase price of approximately $29.9 million in cash. The Company concluded that the remaining 49% of the issued and outstanding shares of Cisneros Interactive stock was considered to be a noncontrolling interest.

In connection with the acquisition, the Company also entered into a Put and Call Option Agreement (the “Put and Call Agreement”). Subject to the terms of the Put and Call Agreement, if certain minimum EBITDA targets are met, the Sellers had the right (the “Put Option”), between March 15, 2024 and June 13, 2024, to cause the Company to purchase all (but not less than all) the remaining 49% of the issued and outstanding shares of Cisneros Interactive stock at a purchase price to be based on a pre-determined multiple of six times Cisneros Interactive’s 12-month EBITDA in the preceding calendar year. The Sellers also had the right to exercise the Put Option upon the occurrence of certain events, between March 2022 and April 2024.

Additionally, subject to the terms of the Put and Call Agreement, the Company had the right (the “Call Option”), in calendar year 2024, to purchase all (but not less than all) the remaining 49% of the issued and outstanding shares of Cisneros Interactive stock at a purchase price to be based on a pre-determined multiple of six times of Cisneros Interactive’s 12-month EBITDA in calendar year 2023.

Applicable accounting guidance requires an equity instrument that is redeemable for cash or other assets to be classified outside of permanent equity if it is redeemable (a) at a fixed or determinable price on a fixed or determinable date, (b) at the option of the holder, or (c) upon the occurrence of an event that is not solely within the control of the issuer.

As a result of the Put Option and Call Option redemption features, and because the redemption was not solely within the control of the Company, the noncontrolling interest was considered redeemable, and was classified in temporary equity within the Company’s Consolidated Balance Sheets initially at its acquisition date fair value. The noncontrolling interest was adjusted each reporting period for income (or loss) attributable to the noncontrolling interest as well as any applicable distributions made. Since the noncontrolling interest was not then redeemable under the terms of the Put and Call Agreement and it was not probable that it would become redeemable, the Company was not required to adjust the amount presented in temporary equity to its redemption value in prior periods. The fair value of the redeemable noncontrolling interest which includes the Put and Call Agreement recognized on the acquisition date was $30.8 million.

The Company is in the process of completing the purchase price allocation for its acquisition of Cisneros Interactive. The measurement period remains open pending the finalization of pre-acquisition tax-related items. The following is a summary of the purchase price allocation (unaudited; in millions):

The fair value of the assets acquired includes trade receivables of $50.5 million. The gross amount due under contract is $54.0 million, of which $3.5 million is expected to be uncollectable.

The goodwill, which is not expected to be deductible for tax purposes, is assigned to the Company’s digital segment and is attributable to Cisneros Interactive’s workforce and synergies from combining Cisneros Interactive’s operations with those of the Company.

On September 1, 2021, the Company acquired the remaining 49% of the issued and outstanding shares of Cisneros Interactive stock, and as of that date owns 100% of the issued and outstanding shares of stock of Cisneros Interactive. As consideration for the acquisition, the Company agreed to pay the Sellers contingent earn-out payments, based on a predetermined multiple of six times Cisneros Interactive’s 12-month EBITDA targets in calendar years 2021, 2022 and 2023, each divided by three, and an additional payment equal to $10,000,000, less an amount (up to $10,000,000) equal to 49 percent of any amounts paid by Cisneros Interactive for future acquisitions. The fair value of the contingent consideration recognized on the acquisition date was $84.4 million, which was estimated by applying the real options approach. Key assumptions include risk-neutral expected growth rates based on management’s assessments of expected growth in EBITDA, adjusted by appropriate factors capturing their correlation with the market and volatility, discounted at a cost of debt rate ranging from 6.5% to 7.2% over the three-year period. These are significant inputs that are not observable in the market, which ASC 820-10-35 refers to as Level 3 inputs. This contingent liability has been reflected in the Consolidated Balance Sheet as of September 30, 2021 as current and noncurrent liabilities of $26.5 and $57.9 million, respectively, and has not changed materially between the acquisition date and September 30, 2021. The Company will recognize any subsequent changes in fair value of the contingent liability in earnings. The Sellers may elect to accelerate their earn-out payments upon the occurrence of certain events. As part of the Company’s acquisition of the remaining 49% of the issued and outstanding shares of Cisneros Interactive stock, the Put and Call Agreement was terminated effective September 1, 2021.

Applicable accounting guidance requires changes in the Company's ownership interest while the Company retains its controlling financial interest in its subsidiary to be accounted for as an equity transaction. Therefore, no gain or loss was recognized in relation to the acquisition of the remaining 49% of the issued and outstanding shares of stock of Cisneros Interactive. As of the acquisition date, the carrying amount of the noncontrolling interest was adjusted to reflect the change in the Company's ownership interest, and the difference between the fair value of the contingent consideration and the amount by which the noncontrolling interest was recognized as a decrease to paid-in capital in the Consolidated Balance Sheets and the Statements of Stockholders' Equity.

The table below presents the reconciliation of changes in redeemable noncontrolling interests (unaudited; in thousands):


	Three-Month Period					Nine-Month Period
	Ended September 30,					Ended September 30,
	2021			2020		2021			2020
Beginning balance	$	37,470		$	-	$	33,285		$	-
Net income attributable to redeemable noncontrolling interest		1,753			-		5,938			-
Acquisition of redeemable noncontrolling interest		(39,223	)		-		(39,223	)		-
Ending balance	$	-		$	-	$	-		$	-

During the three-month period ended September 30, 2021, Cisneros Interactive generated net revenue and net income of $116.6 million and $4.8 million, respectively. During the nine-month period ended September 30, 2021, Cisneros Interactive generated net revenue and net income of $320.0 million and $13.4 million, respectively.

The following unaudited pro forma information has been prepared to give effect to the Company’s wholly-owned acquisition of Cisneros Interactive as if the acquisition had occurred on January 1, 2020. This pro forma information was adjusted to exclude acquisition fees and costs of $0.8 million for each of the three- and nine-month periods ended September 30, 2020, which were expensed in connection with the acquisition. This pro forma information does not purport to represent what the actual results of operations of the Company would have been had this acquisition occurred on such date, nor does it purport to predict the results of operations for any future periods.


	Three-Month Period				Nine-Month Period
	Ended September 30,				Ended September 30,
	2021		2020		2021		2020
Pro Forma:
Total revenue	$	199,008	$	116,248	$	526,298	$	307,868
Net income (loss)		13,884		12,168		31,362		(18,332	)
Net (income) loss attributable to redeemable noncontrolling interest		-		-		-		-
Net income (loss) attributable to common stockholders	$	13,884	$	12,168	$	31,362	$	(18,332	)

Basic and diluted earnings per share:
Net income (loss) per share, attributable to common stockholders, basic	$	0.16	$	0.14	$	0.37	$	(0.22	)
Net income (loss) per share, attributable to common stockholders, diluted	$	0.16	$	0.14	$	0.36	$	(0.22	)

Weighted average common shares outstanding, basic		85,390,333		84,185,728		85,207,992		84,208,924
Weighted average common shares outstanding, diluted		88,315,732		84,863,020		87,694,395		84,208,924

On July 1, 2021, the Company acquired 100% of the issued and outstanding shares of stock of MediaDonuts, a company engaged in the sale and marketing of digital advertising in Southeast Asia. The acquisition, funded from the Company’s cash on hand, includes a purchase price of approximately $15.1 million in cash, which amount was adjusted at closing to approximately $17.1 million due to customary purchase price adjustments for cash, indebtedness and estimated working capital. Subsequently, the purchase price was adjusted downward by approximately $1.2 million, based on actual working capital acquired. Additionally, the transaction includes up to $7.4 million in contingent earn-out payments based upon the achievement of certain EBITDA targets in calendar years 2021 and 2022, and an additional earn-out based upon the achievement of certain year-over-year EBITDA growth targets in calendar years 2023 and 2024, calculated as a pre-determined multiple of EBITDA for each of those years.

As noted above, the acquisition of MediaDonuts includes a contingent consideration arrangement that requires additional consideration to be paid by the Company to MediaDonuts based on a pre-determined multiple of MediaDonuts' 12-month EBITDA targets in calendar years 2021 through 2024. The fair value of the contingent consideration recognized on the acquisition date of $20.3 million was estimated by applying the real options approach. Key assumptions include risk-neutral expected growth rates based on management’s assessments of expected growth in EBITDA, adjusted by appropriate factors capturing their correlation with the market and volatility, discounted at a cost of debt rate ranging from 5.8% to 6.7% over the three year period. These are significant inputs that are not observable in the market, which ASC 820-10-35 refers to as Level 3 inputs. This contingent liability has been reflected in the Consolidated Balance Sheet as of September 30, 2021 as noncurrent liabilities of $20.3, and has not changed materially between the acquisition date and September 30, 2021.

The fair value of the assets acquired includes trade receivables of $9.9 million. The gross amount due under contract is $10.2 million, of which $0.3 million is expected to be uncollectable.

During the three- and nine-month periods ended September 30, 2021, MediaDonuts generated net revenue of $12.1 million and no net income.

The goodwill, which is not expected to be deductible for tax purposes, is assigned to the Company’s digital segment and is attributable to MediaDonuts' workforce and expected synergies from combining MediaDonuts' operations with those of the Company. The changes in the carrying amount of goodwill for each of the Company’s operating segments for the nine-month period ended September 30, 2021 are as follows (in thousands):


	December 31, 2020		Purchase Price Adjustment Cisneros Interactive			Acquisition of MediaDonuts		September 30, 2021
Television	$	40,549	$	-		$	-	$	40,549
Digital		17,494		(2,439	)		13,124		28,179
Consolidated	$	58,043	$	(2,439	)	$	13,124	$	68,728

The following unaudited pro forma information has been prepared to give effect to the Company’s acquisition of MediaDonuts as if the acquisition had occurred on January 1, 2020. This pro forma information was adjusted to exclude acquisition fees and costs of $0.7 million for the nine-month period ended September 30, 2021, which were expensed in connection with the acquisition. This pro forma information does not purport to represent what the actual results of operations of the Company would have been had this acquisition occurred on such date, nor does it purport to predict the results of operations for any future periods.


	Three-Month Period				Nine-Month Period
	Ended September 30,				Ended September 30,
	2021		2020		2021		2020
Pro Forma:
Total revenue	$	199,008	$	70,859	$	547,941	$	187,518
Net income (loss) attributable to common stockholders		12,131		9,688		28,605		(22,539	)

Basic and diluted earnings per share:
Net income (loss) per share, attributable to common stockholders, basic	$	0.14	$	0.12	$	0.34	$	(0.27	)
Net income (loss) per share, attributable to common stockholders, diluted	$	0.14	$	0.11	$	0.33	$	(0.27	)

Weighted average common shares outstanding, basic		85,390,333		84,185,728		85,207,992		84,208,924
Weighted average common shares outstanding, diluted		88,315,732		84,863,020		87,694,395		84,208,924