Upon consummation of each acquisition the Company evaluates whether the acquisition constitutes a business. If substantially all the fair value is concentrated in a single asset (or group of similar assets) the acquired entity is not a business. An acquisition is considered a business if it is comprised of a complete self-sustaining integrated set of activities and assets consisting of inputs and substantive processes applied to those inputs that are used to generate revenues. For a transferred set of activities and assets to be a business, it must contain all of the inputs and processes necessary for it to continue to conduct normal operations after the transferred set is separated from the transferor, which includes the ability to sustain a revenue stream by providing its outputs to customers. A transferred set of activities and assets fails the definition of a business if it excludes one or more significant items such that it is not possible for the set to continue normal operations and sustain a revenue stream by providing its products and/or services to customers.

All business acquisitions have been accounted for as purchase business combinations with the operations of the businesses included subsequent to their acquisition dates. The allocation of the respective purchase prices is generally based upon independent appraisals and or management’s estimates of the discounted future cash flows to be generated from the media properties for intangible assets, and replacement cost for tangible assets. Deferred income taxes are provided for temporary differences based upon management’s best estimate of the tax basis of acquired assets and liabilities that will ultimately be accepted by the applicable taxing authority.

For business combinations where noncontrolling interests remain after the acquisition, assets (including goodwill) and liabilities of the acquired business are recorded at the full fair value and the portion of the acquisition date fair value attributable to noncontrolling interests is recorded as a separate line item within the equity section or, as applicable to redeemable noncontrolling interests, between the liabilities and equity sections of the Company’s consolidated balance sheets. Policies related to redeemable noncontrolling interest involve judgment and complexity, specifically on the classification of the noncontrolling interest in the Company’s consolidated balance sheet. Further, there is significant judgment in determining whether an equity instrument is currently redeemable or not currently redeemable but probable that the equity instrument will become redeemable. Additionally, there are also significant estimates made in the valuation of the redeemable noncontrolling interest.

On October 13, 2020, the Company acquired from certain individuals (collectively, the “Sellers”), 51% of the issued and outstanding shares 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 transaction, funded from cash on hand, includes 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 is 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 have 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) of the remaining 49% of the issued and outstanding shares of Cisneros Interactive 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 may also 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 has the right (the “Call Option”), in calendar year 2024, to purchase all (but not less than all) of the remaining 49% of the issued and outstanding shares of Cisneros Interactive 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 and call option redemption feature, and since the redemption is not solely within the control of the Company, the noncontrolling interest is considered redeemable, and is classified in temporary equity within the Company’s Consolidated Balance Sheets initially at its acquisition date fair value. The noncontrolling interest is adjusted each reporting period for income (or loss) attributable to the noncontrolling interest as well as any applicable distributions made. Since the noncontrolling interest is not currently redeemable and it is not probable that it will become redeemable, the Company is not currently required to adjust the amount presented in temporary equity to its redemption value. The table below presents the reconciliation of changes in redeemable noncontrolling interests (in thousands):

	Years Ended December 31,
	2020		2019		2018
Beginning balance	$	-	$	-	$	-
Initial fair value of redeemable noncontrolling interests		30,762		-		-
Net income (loss) attributable to redeemable noncontrolling interest		2,523		-		-
Ending balance	$	33,285	$	-	$	-

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

Cash	$	8.7
Accounts receivable		50.5
Other assets		6.2
Intangible assets subject to amortization		41.7
Goodwill		12.3
Current liabilities		(48.1	)
Deferred tax		(10.6	)
Redeemable noncontrolling interest		(30.8	)

Intangible Asset	Estimated Fair Value (in millions)		Weighted average life (in years)
Publisher relationships	$	34.4	10.0
Advertiser relationships		5.2	4.0
Trade name		1.7	2.5
Non-Compete agreements		0.4	4.0

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.

During the year ended December 31, 2020, since the acquisition date, Cisneros Interactive generated net revenue and net income of $89.2 million and $5.1 million, respectively.

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

As noted above, the acquisition of a majority interest in Cisneros Interactive included a redeemable noncontrolling interest and a Put and Call Agreement. 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 following unaudited pro forma information for the years ended December 31, 2020 and 2019 has been prepared to give effect to the acquisition of a majority interest in Cisneros Interactive as if the acquisition had occurred on January 1, 2019. This pro forma information was adjusted to exclude acquisition fees and costs of $0.9 million for the year ended December 31, 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.

	Years Ended
	Ended December 31,
	2020			2019
Pro Forma:
Total revenue	$	488,137		$	432,966
Net income (loss)		5,257			(11,403	)
Net income (loss) attributable to redeemable noncontrolling interest		(5,343	)		(4,071	)
Net income (loss) attributable to common stockholders	$	(86	)	$	(15,474	)

Basic and diluted earnings per share:
Net income (loss) per share, attributable to common stockholders, basic and diluted	$	0.00		$	(0.18	)

Weighted average common shares outstanding, basic and diluted		84,231,212			85,107,301

On November 7, 2019, the Company completed the acquisition of television station KMBH-TV, serving the McAllen, Texas area, for an aggregate cash consideration of $2.9 million. The transaction was treated as an asset acquisition with $2.3 million of the purchase price recorded in “Intangible assets not subject to amortization”, and the remainder recorded in “Property and equipment, net of accumulated depreciation” on the Company’s consolidated balance sheet.

On June 11, 2018, the Company completed the acquisition of 100% of the stock of Smadex, S.L. (“Smadex”), a mobile programmatic solutions provider that delivers performance-based solutions and data insights for marketers. The transaction was treated as a business acquisition in accordance with the guidance of ASC 805. 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 final purchase price allocation for the Company’s acquisition of Smadex (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 year ended December 31, 2018, Smadex generated net revenue and expenses of $6.4 million and $5.8 million, respectively, which are included in our 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 following unaudited pro forma information for the years ended December 31, 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.

	Years Ended December 31,
	2018
Pro Forma:
Total revenue	$	307,805
Net income (loss)	$	13,133

Basic and diluted earnings per share:
Net income per share, basic	$	0.15
Net income per share, diluted	$	0.15

Weighted average common shares outstanding, basic		89,115,997
Weighted average common shares outstanding, diluted		90,328,583

The unaudited pro forma information for the year ended December 31, 2018 was adjusted to exclude acquisition fees and costs of $0.4 million, which were expensed in connection with the acquisition.

On January 16, 2018, the Company completed the acquisition of television station KMCC-TV, which serves the Las Vegas, Nevada area, for an aggregate cash consideration of $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. On April 2, 2020, the Company sold KMCC-TV to ION Media Stations, Inc. for $4.0 million. The transaction resulted in a gain of $0.6 million, which is included in other operating gain in the consolidated statements of operations.