6. ACQUISITIONS

KMCC-TV

On January 16, 2018, the Company completed the acquisition of television station KMCC-TV, which serves the Las Vegas, Nevada area, for an aggregate $3.6 million. The transaction was treated as an asset acquisition with the majority of the purchase price recorded in “Intangible assets not subject to amortization” on the Company’s consolidated balance sheet.

Smadex

On June 11, 2018, the Company completed the acquisition of 100% of the stock of Smadex, S.L. (“Smadex”), a mobile programmatic solutions provider and demand-side platform that delivers performance-based solutions and data insights for marketers. The transaction was treated as a business acquisition in accordance with the guidance of ASU 2017-01. The Company acquired Smadex to expand its technology platform, broaden its digital solutions offering and enhance its execution of performance campaigns. The transaction was funded from cash on hand for an aggregate cash consideration of $3.5 million, net of $1.2 million of cash acquired.

The following is a summary of the initial purchase price allocation for the Company’s acquisition of Smadex (unaudited; in millions):

Accounts receivable	$	0.9
Other current assets		0.4
Intangible assets subject to amortization		2.0
Goodwill		3.6
Current liabilities		(2.8	)
Long-term liabilities		(0.2	)
Deferred Tax		(0.4	)

The fair value of assets acquired includes trade receivables of $0.9 million. The gross amount due under contract is $0.9 million, all of which is expected to be collectible.

During the three-month period ended September 30, 2018, Smadex generated net revenue and expenses of $3.5 million and $3.2 million, respectively, which are included in the Company’s consolidated statements of operations. During the nine-month period ended September 30, 2018, Smadex generated net revenue and expenses of $3.9 million and $3.7 million, respectively, which are included in the Company’s consolidated statements of operations.

The goodwill, which is not expected to be deductible for tax purposes, is assigned to the digital segment and is attributable to the Smadex workforce and expected synergies from combining its 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, 2018 are as follows (in thousands):

		December 31,				September 30,
		2017		Acquisition		2018
Television	$	40,549	$	-	$	40,549
Digital		30,008		3,592		33,600
Consolidated	$	70,557	$	3,592	$	74,149

The fair value of the acquired intangible assets is provisional pending receipt of the final valuations for those assets.

The following unaudited pro-forma information for the three- and nine-month periods ended September 30, 2018 and 2017, has been prepared to give effect to the acquisition of Smadex as if the acquisition had occurred on January 1, 2017. 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 future periods.

	Three-Month Period				Nine-Month Period
	Ended September 30,				Ended September 30,
	2018		2017		2018		2017
Pro-Forma:
Total revenue	$	74,575	$	336,503	$	219,400	$	467,050
Net income (loss)	$	2,215	$	157,428	$	5,841	$	163,540

Basic and diluted earnings per share:
Net income per share, basic	$	0.02	$	1.74	$	0.07	$	1.81
Net income per share, diluted	$	0.02	$	1.71	$	0.06	$	1.78

Weighted average common shares outstanding, basic		88,852,342		90,517,492		89,371,750		90,370,679
Weighted average common shares outstanding, diluted		90,122,425		92,161,108		90,574,663		91,985,946

The unaudited pro-forma information for the nine-month periods ended September 30, 2018 was adjusted to exclude acquisition fees and costs of $0.4 million.